Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Mar. 31, 2021 | May 14, 2021 | |
Cover [Abstract] | ||
Entity Registrant Name | Digipath, Inc. | |
Entity Central Index Key | 0001502966 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2021 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --09-30 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business Flag | true | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 68,181,820 | |
Document Fiscal Period Focus | Q2 | |
Document Fiscal Year Focus | 2021 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) | Mar. 31, 2021 | Sep. 30, 2020 |
Current assets: | ||
Cash | $ 113,706 | $ 82,749 |
Accounts receivable, net | 210,730 | 242,145 |
Other current assets | 40,996 | 53,673 |
Deposits | 18,675 | 18,675 |
Total current assets | 384,107 | 397,242 |
Right-of-use asset | 460,398 | 505,706 |
Fixed assets, net | 725,175 | 885,405 |
Total Assets | 1,569,680 | 1,788,353 |
Current liabilities: | ||
Accounts payable | 329,307 | 387,946 |
Accrued expenses | 190,742 | 163,152 |
Short term advances | 90,112 | 50,112 |
Current portion of operating lease liabilities | 89,078 | 84,731 |
Current portion of finance lease liabilities | 33,146 | 32,532 |
Current maturities of notes payable | 55,898 | 54,317 |
Total current liabilities | 788,283 | 772,790 |
Non-current liabilities: | ||
Operating lease liabilities | 378,262 | 423,752 |
Finance lease liabilities | 3,050 | 20,379 |
Notes payable | 350,443 | 418,907 |
Convertible notes payable, net of discounts of $-0- and $8,322 at March 31, 2021 and September 30, 2020, respectively | 1,160,000 | 1,241,678 |
Total non-current liabilities | 1,891,755 | 2,104,716 |
Total Liabilities | 2,680,038 | 2,877,506 |
Stockholders' Equity (Deficit): | ||
Series A convertible preferred stock, $0.001 par value, 10,000,000 shares authorized; 1,325,942 shares issued and outstanding | 1,326 | 1,326 |
Common stock, $0.001 par value, 250,000,000 shares authorized; 68,181,820 and 58,270,567 shares issued and outstanding at March 31, 2021 and September 30, 2020, respectively | 68,182 | 58,271 |
Additional paid-in capital | 16,457,720 | 16,116,400 |
Accumulated (deficit) | (17,637,586) | (17,265,150) |
Total Stockholders' Equity (Deficit) | (1,110,358) | (1,089,153) |
Total Liabilities and Stockholders' Equity (Deficit) | $ 1,569,680 | $ 1,788,353 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) | Mar. 31, 2021 | Sep. 30, 2020 |
Statement of Financial Position [Abstract] | ||
Convertible notes payable discounts non-current | $ 0 | $ 8,322 |
Series A convertible preferred stock, par value | $ 0.001 | $ 0.001 |
Series A convertible preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Series A convertible preferred stock, shares issued | 1,325,942 | 1,325,942 |
Series A convertible preferred stock, shares outstanding | 1,325,942 | 1,325,942 |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 250,000,000 | 250,000,000 |
Common stock, shares issued | 68,181,820 | 58,270,567 |
Common stock, shares outstanding | 68,181,820 | 58,270,567 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2021 | Mar. 31, 2020 | Mar. 31, 2021 | Mar. 31, 2020 | |
Income Statement [Abstract] | ||||
Revenues | $ 633,160 | $ 754,982 | $ 1,133,545 | $ 1,563,912 |
Cost of sales | 416,915 | 497,029 | 837,800 | 902,510 |
Gross profit | 216,245 | 257,953 | 295,745 | 661,402 |
Operating expenses: | ||||
General and administrative | 211,961 | 406,919 | 437,011 | 795,351 |
Professional fees | 107,819 | 327,434 | 222,363 | 511,067 |
Change in allowance for doubtful accounts | (106,155) | 117,870 | (17,985) | 161,120 |
Total operating expenses | 213,625 | 852,223 | 641,389 | 1,467,538 |
Operating income (loss) | 2,620 | (594,270) | (345,644) | (806,136) |
Other income (expense): | ||||
Other income | 47,918 | 21,000 | 47,918 | 42,000 |
Interest expense | (32,337) | (35,873) | (74,710) | (65,434) |
Total other income (expense) | 15,581 | (14,873) | (26,792) | (23,434) |
Net income (loss) | $ 18,201 | $ (609,143) | $ (372,436) | $ (829,570) |
Weighted average number of common shares outstanding - basic | 65,418,890 | 50,586,842 | 61,882,937 | 49,473,671 |
Weighted average number of common shares outstanding - fully diluted | 114,702,490 | 50,586,842 | 111,166,537 | 49,473,671 |
Net income (loss) per share - basic | $ 0 | $ (0.01) | $ (0.01) | $ (0.02) |
Net income (loss) per share - fully diluted | $ 0 | $ (0.01) | $ 0 | $ (0.02) |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity (Deficit) (Unaudited) - USD ($) | Series A Convertible Preferred Stock [Member] | Common Stock [Member] | Additional Paid-in Capital [Member] | Subscriptions Payable [Member] | Accumulated (Deficit) [Member] | Total |
Balance at Sep. 30, 2019 | $ 1,326 | $ 48,361 | $ 15,331,839 | $ (14,955,660) | $ 425,866 | |
Balance, shares at Sep. 30, 2019 | 1,325,942 | 48,361,433 | ||||
Common stock sold for cash | $ 706 | 55,794 | 56,500 | |||
Common stock sold for cash, shares | 706,250 | |||||
Common stock issued for acquisition of VSSL Enterprises, Ltd. | $ 6,500 | 367,250 | 373,750 | |||
Common stock issued for acquisition of VSSL Enterprises, Ltd., shares | 6,500,000 | |||||
Common stock issued for services | $ 1,171 | 16,042 | 37,500 | 54,713 | ||
Common stock issued for services, shares | 1,169,989 | |||||
Common stock options issued for services | 38,288 | 38,288 | ||||
Common stock warrants issued for services | 70,012 | 70,012 | ||||
Net loss | (829,570) | (829,570) | ||||
Balance at Mar. 31, 2020 | $ 1,326 | $ 56,738 | 15,879,225 | 37,500 | (15,785,230) | 189,559 |
Balance, shares at Mar. 31, 2020 | 1,325,942 | 56,737,672 | ||||
Balance at Dec. 31, 2019 | $ 1,326 | $ 48,533 | 15,374,094 | (15,176,087) | 47,866 | |
Balance, shares at Dec. 31, 2019 | 1,325,942 | 48,532,666 | ||||
Common stock sold for cash | $ 706 | 55,794 | 56,500 | |||
Common stock sold for cash, shares | 706,250 | |||||
Common stock issued for acquisition of VSSL Enterprises, Ltd. | $ 6,500 | 367,250 | 373,750 | |||
Common stock issued for acquisition of VSSL Enterprises, Ltd., shares | 6,500,000 | |||||
Common stock issued for services | $ 999 | (8,536) | 37,500 | 29,963 | ||
Common stock issued for services, shares | 998,756 | |||||
Common stock options issued for services | 20,611 | 20,611 | ||||
Common stock warrants issued for services | 70,012 | 70,012 | ||||
Net loss | (609,143) | (609,143) | ||||
Balance at Mar. 31, 2020 | $ 1,326 | $ 56,738 | 15,879,225 | 37,500 | (15,785,230) | 189,559 |
Balance, shares at Mar. 31, 2020 | 1,325,942 | 56,737,672 | ||||
Balance at Sep. 30, 2020 | $ 1,326 | $ 58,271 | 16,116,400 | (17,265,150) | (1,089,153) | |
Balance, shares at Sep. 30, 2020 | 1,325,942 | 58,270,567 | ||||
Common stock sold for cash, related party | $ 900 | 19,350 | 20,250 | |||
Common stock sold for cash, related party, shares | 900,000 | |||||
Common stock issued for debt conversions | $ 6,666 | 193,334 | 200,000 | |||
Common stock issued for debt conversions, shares | 6,666,668 | |||||
Common stock issued for services, related parties | $ 1,595 | 62,185 | 63,780 | |||
Common stock issued for services, related parties, Shares | 1,594,585 | |||||
Common stock issued for services | $ 750 | 23,325 | 26,075 | |||
Common stock issued for services, shares | 750,000 | |||||
Common stock options issued for services, related parties | 22,186 | 22,186 | ||||
Common stock options issued for services | 18,940 | 18,940 | ||||
Net loss | (372,436) | (372,436) | ||||
Balance at Mar. 31, 2021 | $ 1,326 | $ 68,182 | 16,457,720 | (17,637,586) | (1,110,358) | |
Balance, shares at Mar. 31, 2021 | 1,325,942 | 68,181,820 | ||||
Balance at Dec. 31, 2020 | $ 1,326 | $ 64,065 | 16,284,916 | (17,655,787) | (1,305,480) | |
Balance, shares at Dec. 31, 2020 | 1,325,942 | 64,065,390 | ||||
Common stock issued for debt conversions | $ 3,000 | 87,000 | 90,000 | |||
Common stock issued for debt conversions, shares | 3,000,000 | |||||
Common stock issued for services, related parties | $ 867 | 47,913 | 48,780 | |||
Common stock issued for services, related parties, Shares | 866,430 | |||||
Common stock issued for services | $ 250 | 13,825 | 14,075 | |||
Common stock issued for services, shares | 250,000 | |||||
Common stock options issued for services, related parties | 8,244 | 8,244 | ||||
Common stock options issued for services | 15,822 | 15,822 | ||||
Net loss | 18,201 | 18,201 | ||||
Balance at Mar. 31, 2021 | $ 1,326 | $ 68,182 | $ 16,457,720 | $ (17,637,586) | $ (1,110,358) | |
Balance, shares at Mar. 31, 2021 | 1,325,942 | 68,181,820 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 6 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Cash flows from operating activities | ||
Net loss | $ (372,436) | $ (829,570) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Change in allowance for doubtful accounts | (17,985) | 161,120 |
Depreciation and amortization expense | 159,209 | 156,171 |
Loss on disposal of fixed assets | 2,227 | |
Gain on early extinguishment of debt | (40,338) | |
Stock issued for services | 89,855 | 54,713 |
Options and warrants granted for services | 41,126 | 108,300 |
Amortization of debt discounts | 8,322 | 16,552 |
Decrease (increase) in assets: | ||
Accounts receivable | 49,400 | (138,000) |
Other current assets | 12,677 | 31,258 |
Inventory | (37,900) | |
Deposits | 26,057 | |
Right-of-use assets | 45,308 | 95,423 |
Increase (decrease) in liabilities: | ||
Accounts payable | (58,639) | 103,736 |
Accrued expenses | 27,814 | 6,971 |
Lease liabilities | (41,143) | (93,465) |
Net cash used in operating activities | (94,603) | (456,504) |
Cash flows from investing activities | ||
Cash acquired from affiliate in acquisition of VSSL | 143 | |
Cash paid for purchase of VSSL Enterprises, Ltd. | (200,000) | |
Purchase of fixed assets | (1,206) | (135,791) |
Net cash used in investing activities | (1,206) | (335,648) |
Cash flows from financing activities | ||
Proceeds from short term advances | 40,000 | 25,000 |
Repayments of short term advances | (25,000) | |
Principal payments on finance lease | (16,715) | (35,387) |
Principal payments on note payable, equipment financing | (26,769) | (12,729) |
Proceeds from convertible notes | 110,000 | 550,000 |
Proceeds from sale of common stock | 20,250 | 56,500 |
Net cash provided by financing activities | 126,766 | 558,384 |
Net increase (decrease) in cash | 30,957 | (233,768) |
Cash - beginning | 82,749 | 323,739 |
Cash - ending | 113,706 | 89,971 |
Supplemental disclosures: | ||
Interest paid | 32,294 | 16,601 |
Income taxes paid | ||
Non-cash investing and financing activities: | ||
Fair value of net assets acquired from affiliate in business combination | 18,871 | |
Fair value of common stock paid to affiliate in business combination | 373,750 | |
Fixed assets acquired with capitalized finance lease | 99,193 | |
Fixed assets acquired with note payable, equipment financing | $ 200,000 | $ 291,931 |
Organization, Basis of Presenta
Organization, Basis of Presentation and Significant Accounting Policies | 6 Months Ended |
Mar. 31, 2021 | |
Accounting Policies [Abstract] | |
Organization, Basis of Presentation and Significant Accounting Policies | Note 1 – Organization, Basis of Presentation and Significant Accounting Policies Organization Digipath, Inc. was incorporated in Nevada on October 5, 2010. Digipath, Inc. and its subsidiaries (“Digipath,” the “Company,” “we,” “our” or “us”) is a service-oriented independent testing laboratory, data analytics and media firm focused on the developing cannabis and hemp markets, and supports the cannabis industry’s best practices for reliable testing, cannabis education and training. Our mission is to provide pharmaceutical-grade analysis and testing to the cannabis industry, under ISO-17025:2017 guidelines, to ensure consumers and patients know exactly what is in the cannabis they ingest and to help maximize the quality of our clients’ products through research, development, and standardization. Digipath has been operating a cannabis-testing lab in Nevada since 2015 and hopes to open labs in other states that have legalized the sale of cannabis, beginning with California or Arizona. Basis of Presentation The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”). Intercompany accounts and transactions have been eliminated. The unaudited condensed consolidated financial statements of the Company and the accompanying notes included in this Quarterly Report on Form 10-Q are unaudited. In the opinion of management, all adjustments necessary for a fair presentation of the Condensed Consolidated Financial Statements have been included. Such adjustments are of a normal, recurring nature. The Condensed Consolidated Financial Statements, and the accompanying notes, are prepared in accordance with GAAP and do not contain certain information included in the Company’s Annual Report on Form 10-K for the fiscal year ended September 30, 2020. The interim Condensed Consolidated Financial Statements should be read in conjunction with that Annual Report on Form 10-K. Results for the interim periods presented are not necessarily indicative of the results that might be expected for the entire fiscal year. Principles of Consolidation The accompanying consolidated financial statements include the accounts of the following entities, all of which were under common control and ownership at March 31, 2021: Jurisdiction of Name of Entity (1) Incorporation Relationship Digipath, Inc. (2) Nevada Parent Digipath Labs, Inc. Nevada Subsidiary TNM News, Inc. Nevada Subsidiary Digipath Labs S.A.S. (3) Colombia Subsidiary VSSL Enterprises, Ltd. (4) Canada Subsidiary (1) (2) Holding company, which owns each of the wholly-owned subsidiaries. All subsidiaries shown above are wholly-owned by Digipath, Inc., the parent company. (3) Formed during the first fiscal quarter of 2019, but has not yet commenced significant operations. (4) Acquired on March 11, 2020. The consolidated financial statements herein contain the operations of the wholly-owned subsidiaries listed above. All significant inter-company transactions have been eliminated in the preparation of these financial statements. The parent company and subsidiaries will be collectively referred to herein as the “Company”, “Digipath” or “DIGP”. The Company’s headquarters are located in Las Vegas, Nevada and substantially all of its customers are within the United States. These statements reflect all adjustments, consisting of normal recurring adjustments, which in the opinion of management are necessary for fair presentation of the information contained therein. Segment Reporting ASC Topic 280, “Segment Reporting,” requires use of the “management approach” model for segment reporting. The management approach model is based on the way a company’s management organizes segments within the company for making operating decisions and assessing performance. The Company operates as a single segment and will evaluate additional segment disclosure requirements as it expands its operations. Fair Value of Financial Instruments Under FASB ASC 820-10-05, the Financial Accounting Standards Board establishes a framework for measuring fair value in generally accepted accounting principles and expands disclosures about fair value measurements. This Statement reaffirms that fair value is the relevant measurement attribute. The adoption of this standard did not have a material effect on the Company’s financial statements as reflected herein. The carrying amounts of cash, accounts receivable, accounts payable and accrued expenses reported on the balance sheets are estimated by management to approximate fair value primarily due to the short-term nature of the instruments. Revenue Recognition The Company recognizes revenue in accordance with ASC 606 — Revenue from Contracts with Customers. Under ASC 606, the Company recognizes revenue from the sale of lab testing services through our subsidiary Digipath Labs, Inc. Revenue is primarily generated through our subsidiary, Digipath Labs, Inc., which recognizes revenue from the analytical testing of cannabis products for licensed producers and cultivators within the state of Nevada on a determinable fixed fee per test, or panel of tests basis. Revenue from the performance of those services is recognized upon completion of the tests, at which time test results are delivered to the customer, provided collectability of the fee is reasonably assured. We typically require payment within thirty days of the delivery of results. Management estimates an allowance for doubtful accounts based on the aging of its receivables. Stock-Based Compensation The Company accounts for equity instruments issued to employees in accordance with the provisions of ASC 718 Stock Compensation (ASC 718) and Equity-Based Payments to Non-employees pursuant to ASC 2018-07 (ASC 2018-07). All transactions in which goods or services are the consideration received for the issuance of equity instruments are accounted for based on the fair value of the consideration received or the fair value of the equity instrument issued, whichever is more reliably measurable. The measurement date of the fair value of the equity instrument issued is the earlier of the date on which the counterparty’s performance is complete or the date at which a commitment for performance by the counterparty to earn the equity instruments is reached because of sufficiently large disincentives for nonperformance. Adoption of New Accounting Standards and Recently Issued Accounting Pronouncements From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board (“FASB”) that are adopted by the Company as of the specified effective date. If not discussed, management believes that the impact of recently issued standards, which are not yet effective, will not have a material impact on the Company’s financial statements upon adoption. In August 2020, the FASB issued Accounting Standard Update (“ASU”) No. 2020-06, Debt–Debt with Conversion and Other Options and Derivatives and Hedging–Contracts in Entity’s Own Equity : Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity In November 2019, the FASB issued ASU 2019 - Income Taxes ): Simplifying the Accounting for Income Taxes - - . No other new accounting pronouncements, issued or effective during the period ended March 31, 2021, have had or are expected to have a significant impact on the Company’s financial statements. |
Going Concern
Going Concern | 6 Months Ended |
Mar. 31, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Going Concern | Note 2 – Going Concern As shown in the accompanying condensed consolidated financial statements, the Company has incurred recurring losses from operations resulting in an accumulated deficit of $17,637,586, negative working capital of $404,176, and as of March 31, 2021, the Company’s cash on hand may not be sufficient to sustain operations. These factors raise substantial doubt about the Company’s ability to continue as a going concern. Management is actively pursuing new customers to increase revenues. In addition, the Company is currently seeking additional sources of capital to fund short term operations. Management believes these factors will contribute toward achieving profitability. The consolidated financial statements do not include any adjustments that might result from the outcome of any uncertainty as to the Company’s ability to continue as a going concern. These financial statements also do not include any adjustments relating to the recoverability and classification of recorded asset amounts, or amounts and classifications of liabilities that might be necessary should the Company be unable to continue as a going concern. |
Related Party Transactions
Related Party Transactions | 6 Months Ended |
Mar. 31, 2021 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Note 3 – Related Party Transactions Board of Directors Compensation On March 25, 2021, the Board of Directors approved changes to the compensation arrangements for each of Edmond A. DeFrank and Dennis Hartmann for serving as directors of the Company, as follows: ● Effective April 1, 2021, annual compensation is increased from $18,000 to $30,000, payable in quarterly installments of $7,500 each; and ● Such compensation may now be paid in shares of common stock of the Company instead of cash, at the discretion of the Company. In connection with the foregoing, the Board of Directors of the Company also approved changes to the compensation arrangements for Bruce Raben for serving as the Company’s Chairman of the Board, as follows: ● Effective April 1, 2021, annual compensation has been increased from $30,000 to $60,000, payable in quarterly installments of $15,000 each; and ● Such compensation may now be paid in shares of common stock of the Company instead of cash, at the discretion of the Company. Common Stock Sold for Cash On December 30, 2020, the Company sold 900,000 shares of its common stock to its Chairman of the Board in exchange for proceeds of $20,250. Common Stock Issued for Services On March 25, 2021, the Company issued 266,430 shares of common stock to its CFO for services rendered pursuant to his employment agreement. The aggregate fair value of the common stock was $15,000 based on the closing price of the Company’s common stock on the date of grant, and was expensed over the requisite service period. On March 25, 2021, the Board also approved the issuance of 200,000 shares of Common Stock as a bonus to each of Edmond A. DeFrank, Dennis Hartmann and Bruce Raben, or 600,000 shares in the aggregate. The aggregate fair value of the common stock was $33,780 based on the closing price of the Company’s common stock on the date of grant, and was expensed over the requisite service period. On December 25, 2020, the Company issued 728,155 shares of common stock to its CFO for services rendered pursuant to his employment agreement. The aggregate fair value of the common stock was $15,000 based on the closing price of the Company’s common stock on the date of grant, and was expensed over the requisite service period. |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 6 Months Ended |
Mar. 31, 2021 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | Note 4 – Fair Value of Financial Instruments The Company discloses the fair value of certain assets and liabilities in accordance with ASC 820 – Fair Value Measurement The Company has certain financial instruments that must be measured under the new fair value standard. The Company’s financial assets and liabilities are measured using inputs from the three levels of the fair value hierarchy. The three levels are as follows: Level 1 - Inputs are unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date. Level 2 - Inputs include quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability (e.g., interest rates, yield curves, etc.), and inputs that are derived principally from or corroborated by observable market data by correlation or other means (market corroborated inputs). Level 3 - Unobservable inputs that reflect our assumptions about the assumptions that market participants would use in pricing the asset or liability. The following schedule summarizes the valuation of financial instruments at fair value on a recurring basis in the balance sheets as of March 31, 2021 and September 30, 2020, respectively: Fair Value Measurements at March 31, 2021 Level 1 Level 2 Level 3 Assets Cash $ 113,706 $ - $ - Total assets 113,706 - - Liabilities Short term advances - 90,112 - Lease liabilities - - 503,536 Notes payable - 406,341 - Convertible notes payable - - 1,160,000 Total liabilities - 496,453 1,663,536 $ 113,706 $ (496,453 ) $ (1,663,536 ) Fair Value Measurements at September 30, 2020 Level 1 Level 2 Level 3 Assets Cash $ 82,749 $ - $ - Total assets 82,749 - - Liabilities Short term advances - 50,112 - Lease liabilities - - 561,394 Notes payable - 473,224 - Convertible notes payable, net of discounts of $8,322 - - 1,241,678 Total liabilities - 523,336 1,803,072 $ 82,749 $ (523,336 ) $ (1,803,072 ) The fair value of our intellectual properties are deemed to approximate book value, and are considered Level 3 inputs as defined by ASC Topic 820-10-35. Level 3 liabilities consist of lease liabilities and a total of $1,160,000 of convertible debentures and $1,250,000 of convertible debentures, net of discounts of $-0- and $8,322, as of March 31, 2021 and September 30, 2020, respectively. There were no transfers of financial assets or liabilities between Level 1, Level 2 and Level 3 inputs for the six months ended March 31, 2021 or the year ended September 30, 2020. |
Accounts Receivable
Accounts Receivable | 6 Months Ended |
Mar. 31, 2021 | |
Receivables [Abstract] | |
Accounts Receivable | Note 5 – Accounts Receivable Accounts receivable was $210,730 and $242,145 at March 31, 2021 and September 30, 2020, respectively, net of allowance for uncollectible accounts of $110,243 and $128,944 at March 31, 2021 and September 30, 2020, respectively. |
Other Current Assets
Other Current Assets | 6 Months Ended |
Mar. 31, 2021 | |
Other Current Assets | |
Other Current Assets | Note 6 – Other Current Assets Other current assets consist of the following: March 31, September 30, 2021 2020 Prepaid expenses $ 35,612 $ 48,151 Other receivable 5,384 5,522 Total other current assets $ 40,996 $ 53,673 |
Fixed Assets
Fixed Assets | 6 Months Ended |
Mar. 31, 2021 | |
Property, Plant and Equipment [Abstract] | |
Fixed Assets | Note 7 – Fixed Assets Fixed assets consist of the following at March 31, 2021 and September 30, 2020: March 31, September 30, 2021 2020 Software $ 125,903 $ 124,697 Office equipment 71,601 74,777 Furniture and fixtures 29,879 29,879 Lab equipment 1,398,716 1,398,716 Leasehold improvements 494,117 494,117 Lab equipment held under capital leases 99,193 99,193 2,219,409 2,221,379 Less: accumulated depreciation (1,494,234 ) (1,335,974 ) Total $ 725,175 $ 885,405 On March 31, 2021, we distributed fixed assets with an aggregate net book value of $2,227 to our former CEO in satisfaction of accrued payroll that was owed. The fixed assets consisted of office equipment with a historical cost basis of $3,176 and accumulated depreciation of $949, resulting in a loss of $2,227 that was settled against the amount of unpaid compensation that was owed. Depreciation and amortization expense totaled $159,209 and $156,171 for the six months ended March 31, 2021 and 2020, respectively. |
Leases
Leases | 6 Months Ended |
Mar. 31, 2021 | |
Leases [Abstract] | |
Leases | Note 8 – Leases The Company leases its operating and office facility under a non-cancelable real property lease agreement that expires on August 31, 2025. The Company also has a financing lease for lab equipment subject to the recently adopted ASU 2016-02. In the locations in which it is economically feasible to continue to operate, management expects to enter into a new lease upon expiration. The real property lease contains provisions requiring payment of property taxes, utilities, insurance, maintenance and other occupancy costs applicable to the leased premise. As the Company’s leases do not provide implicit discount rates, the Company uses an incremental borrowing rate based on the information available at the commencement date in determining the present value of lease payments. The components of lease expense were as follows: For the Six Months Ended March 31, 2021 Finance lease cost $ 21,644 Operating lease cost: Amortization of assets 45,308 Interest on lease liabilities 14,129 Total lease cost $ 59,437 Supplemental balance sheet information related to leases was as follows: March 31, 2021 Operating leases: Operating lease assets $ 460,398 Current portion of operating lease liabilities $ 89,078 Noncurrent operating lease liabilities 378,262 Total operating lease liabilities $ 467,340 Finance lease: Equipment, at cost $ 99,193 Accumulated amortization (29,758 ) Equipment, net $ 69,435 Current portion of finance lease liability $ 33,146 Noncurrent finance lease liability 3,050 Total finance lease liability $ 36,196 Weighted average remaining lease term: Operating leases 4.42 years Finance leases 1.05 years Weighted average discount rate: Operating leases 5.75 % Finance lease 18.41 % Supplemental cash flow and other information related to leases was as follows: For the Six Months Ended March 31, 2021 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows used for operating leases $ 41,143 Financing cash flows used for finance leases $ 16,715 The following is a maturity analysis of the annual undiscounted cash flows of the operating lease liabilities on a fiscal year basis, including common area maintenance fees, under non-cancelable operating leases as of March 31, 2021: Fiscal Year Ending Minimum Lease September 30, Commitments 2021 (for the six months remaining) $ 56,511 2022 115,550 2023 119,468 2024 123,543 2025 116,891 $ 531,963 Future minimum annual lease payments required under the finance lease and the present value of the net minimum lease payments are as follows at March 31, 2021: Finance Leases 2021 (for the six months remaining) $ 18,553 2022 21,644 Total minimum lease payments 40,197 Less interest 4,001 Present value of lease liabilities 36,196 Less current portion 33,146 Long-term lease liabilities $ 3,050 |
Short Term Advances
Short Term Advances | 6 Months Ended |
Mar. 31, 2021 | |
Debt Disclosure [Abstract] | |
Short Term Advances | Note 9 – Short Term Advances Short term advances consist of the following at March 31, 2021 and September 30, 2020, respectively: March 31, September 30, 2021 2020 On March 23, 2021, we received $40,000 as a short-term loan from one of our convertible noteholders. The loan bears interest at the rate of 8% per annum. $ 40,000 $ - On July 20, 2020, we received $30,112 as a short-term loan from one of our convertible noteholders. The loan bears interest at the rate of 8% per annum. 30,112 30,112 On January 21, 2020, we received $20,000 as a short-term loan from one of our convertible noteholders. No interest expense was recognized. 20,000 20,000 Total short term advances $ 90,112 $ 50,112 The Company recorded interest expense pursuant to the stated interest rates on the short term loans in the amount of $1,687 for the six months ended March 31, 2021. |
Notes Payable
Notes Payable | 6 Months Ended |
Mar. 31, 2021 | |
Debt Disclosure [Abstract] | |
Notes Payable | Note 10 –Notes Payable Notes payable consists of the following at March 31, 2021 and September 30, 2020, respectively: March 31, September 30, 2021 2020 On June 22, 2020, the Company, borrowed $40,114 from Cross River Bank, pursuant to a Promissory Note issued by the Company to Cross River Bank (the “Company PPP Note”). The loan was made pursuant to the Payroll Protection Program established as part of the Coronavirus Aid, Relief, and Economic Security Act (the “Payroll Protection Program”). The Company PPP Note carried interest at 1.00% per annum, payable monthly beginning December 22, 2020, and was due on June 22, 2025. On January 12, 2021, the PPP Note and interest was forgiven, resulting in a gain on early extinguishment of debt in the amount of $40,338. $ - $ 40,114 On May 13, 2020, the Company, through its wholly-owned subsidiary Digipath Labs, Inc. (“Labs”), borrowed $179,920 from WebBank Corp, pursuant to a Promissory Note issued by Labs to WebBank Corp (the “Labs PPP Note”). The loan was made pursuant to the Payroll Protection Program. The Labs PPP Note bears interest at 1.00% per annum, payable monthly beginning December 13, 2020, and is due on May 13, 2022. The Labs PPP Note may be repaid at any time without penalty. 179,920 179,920 On December 26, 2019, the Company financed the purchase of $377,124 of lab equipment, in part, with the proceeds of a bank loan in the amount of $291,931. The loan bears interest at the rate of 5.75% per annum and requires monthly payments of $5,622 over the five-year term of the loan ending on December 26, 2024. The Company’s obligations under this loan are secured by a lien on the purchased equipment. 226,421 253,190 Total notes payable 406,341 473,224 Less: current maturities (55,898 ) (54,317 ) Notes payable $ 350,443 $ 418,907 The Company recorded interest expense pursuant to the stated interest rate and closing costs on the notes payable in the amount of $7,970 and $7,955 during the six months ended March 31, 2021 and 2020, respectively. |
Convertible Notes Payable
Convertible Notes Payable | 6 Months Ended |
Mar. 31, 2021 | |
Debt Disclosure [Abstract] | |
Convertible Notes Payable | Note 11 – Convertible Notes Payable Convertible notes payable consists of the following at March 31, 2021 and September 30, 2020, respectively: March 31, September 30, 2021 2020 On February 11, 2020, the Company completed the sale to an accredited investor of a 9% Secured Convertible Promissory Note in the principal amount of $50,000. The Note matures on August 11, 2022, bears interest at a rate of 9% per annum, and was convertible into shares of the Company’s common stock at a conversion price of $0.15 per share. On December 28, 2020, the conversion price was amended to $0.03 per share in exchange for an additional $10,000 of proceeds and the promissory note was increased to $60,000. The Company’s obligations under the Note are secured by a lien on the assets of the Company and its wholly-owned subsidiary Digipath Labs, Inc., pursuant to a Security Agreement between the Company, Digipath Labs, Inc. and the investor. On December 29, 2020, the note holder converted $10,000 of principal into 333,334 shares of common stock at a conversion price of $0.03 per share. $ 50,000 $ 50,000 On February 11, 2020, the Company completed the sale to an accredited investor of a 9% Secured Subordinated Convertible Promissory Note in the principal amount of $150,000. The Note matures on August 11, 2022, bears interest at a rate of 9% per annum, and was convertible into shares of the Company’s common stock at a conversion price of $0.15 per share. On December 28, 2020, the conversion price was amended to $0.03 per share in exchange for an additional $50,000 of proceeds and the promissory note was increased to $200,000. The Company’s obligations under the Note are secured by subordinated lien on the assets of the Company and its wholly-owned subsidiary Digipath Labs, Inc., pursuant to a Security Agreement between the Company, Digipath Labs, Inc. and the investor. On December 29, 2020, the note holder converted $50,000 of principal into 1,666,667 shares of common stock at a conversion price of $0.03 per share. 150,000 150,000 On February 10, 2020, the Company completed the sale to an accredited investor of a 9% Secured Convertible Promissory Note in the principal amount of $350,000. The Note matures on August 10, 2022, bears interest at a rate of 9% per annum, and was convertible into shares of the Company’s common stock at a conversion price of $0.15 per share. On December 28, 2020, the conversion price was amended to $0.03 per share in exchange for an additional $50,000 of proceeds that were received on January 4, 2021, and the promissory note was increased to $400,000. The Company’s obligations under the Note are secured by a lien on the assets of the Company and its wholly-owned subsidiary Digipath Labs, Inc., pursuant to a Security Agreement between the Company, Digipath Labs, Inc. and the investor. On December 29, 2020, the note holder converted $50,000 of principal into 1,666,667 shares of common stock at a conversion price of $0.03 per share. 350,000 350,000 On September 23, 2019, the Company received proceeds of $200,000 on a senior secured convertible note that carries an 8% interest rate, which matures on August 10, 2022, as amended. The principal and interest were convertible into shares of common stock at the discretion of the note holder at a fixed conversion price of $0.11 per share. On September 30, 2020, the maturity date was extended to August 10, 2022 and the conversion price was amended to $0.03 per share. The Company’s obligations under this Note are secured by a lien on the assets of the Company and its wholly-owned subsidiary Digipath Labs, Inc. On February 22, 2021, the noteholder converted $90,000 of principal into 3,000,000 shares of common stock at a conversion price of $0.03 per share. 110,000 200,000 On November 8, 2018, the Company received proceeds of $350,000 on a senior secured convertible note that carries an 8% interest rate, which matures on August 10, 2022, as amended. The principal and interest were convertible into shares of common stock at the discretion of the note holder at a fixed conversion price of $0.14 per share. On September 30, 2020, the maturity date was extended to August 10, 2022 and the conversion price was amended to $0.03 per share. The Company’s obligations under this Note are secured by a lien on the assets of the Company and its wholly-owned subsidiary Digipath Labs, Inc. A total of $4,066 of interest was repaid during the year ended September 30, 2019. 350,000 350,000 On November 5, 2018, the Company received proceeds of $150,000 on a senior secured convertible note that carries an 8% interest rate, which matures on August 10, 2022, as amended. The principal and interest were convertible into shares of common stock at the discretion of the note holder at a fixed conversion price of $0.14 per share. On September 30, 2020, the maturity date was extended to August 10, 2022 and the conversion price was amended to $0.03 per share. The Company’s obligations under this Note are secured by a lien on the assets of the Company and its wholly-owned subsidiary Digipath Labs, Inc. 150,000 150,000 Total convertible notes payable 1,160,000 1,250,000 Less: unamortized debt discounts - (8,322 ) 1,160,000 1,241,678 Less: current maturities - - Convertible notes payable $ 1,160,000 $ 1,241,678 In addition, the Company recognized and measured the embedded beneficial conversion feature present in the convertible notes by allocating a portion of the proceeds equal to the intrinsic value of the feature to additional paid-in-capital. The intrinsic value of the feature was calculated on the commitment date using the effective conversion price of the convertible notes. This intrinsic value is limited to the portion of the proceeds allocated to the convertible debt. The aforementioned accounting treatment resulted in a total debt discount equal to $70,964. The discount is amortized on a straight-line basis from the dates of issuance until the earlier of the stated redemption date of the debts, as noted above or the actual settlement date. The Company recorded debt amortization expense on the aforementioned debt discount in the amount of $-0- and $8,322 during the six months ended March 31, 2021 and 2020, respectively. All of the convertible notes limit the maximum number of shares that can be owned by each note holder as a result of the conversions to common stock to 4.99% of the Company’s issued and outstanding shares. The Company recorded interest expense pursuant to the stated interest rates on the convertible notes in the amount of $51,802 and $34,796 for the six months ended March 31, 2021 and 2020, respectively. The Company recognized interest expense for the six months ended March 31, 2021 and 2020, respectively, as follows: March 31, March 31, 2021 2020 Interest on short term loans $ 1,687 $ - Interest on capital leases 4,929 6,131 Interest on notes payable 7,970 7,955 Amortization of beneficial conversion features 8,322 16,552 Interest on convertible notes 51,802 34,796 Total interest expense $ 74,710 $ 65,434 |
Changes in Stockholders' Equity
Changes in Stockholders' Equity | 6 Months Ended |
Mar. 31, 2021 | |
Equity [Abstract] | |
Changes in Stockholders' Equity | Note 12 - Changes in Stockholders’ Equity Convertible Preferred Stock The Company is authorized to issue 10,000,000 shares of preferred stock with a par value of $0.001 per share, of which 6,000,000 have been designated as Series A Convertible Preferred Stock (“Series A Preferred”), with the remaining 4,000,000 shares available for designation from time to time by the Board as set forth below. As of March 31, 2021, there were 1,325,942 shares of Series A Preferred issued and outstanding. The Board of Directors is authorized to determine any number of series into which the undesignated shares of preferred stock may be divided and to determine the rights, preferences, privileges and restrictions granted to any series of the preferred stock. Each share of Series A Preferred is currently convertible into five shares of common stock. The conversion price is adjustable in the event of stock splits and other adjustments in the Company’s capitalization, and in the event of certain negative actions undertaken by the Company. At the current conversion price, the 1,325,942 shares of Series A Preferred outstanding at March 31, 2021 are convertible into 6,629,710 shares of the common stock of the Company. No holder is permitted to convert its shares of Series A Preferred if such conversion would cause the holder to beneficially own more than 4.99% of the issued and outstanding common stock of the Company immediately after such conversion, unless waived by such holder by providing at least sixty-five days’ notice. Common Stock Common stock consists of $0.001 par value, 250,000,000 shares authorized, of which 68,181,820 shares were issued and outstanding as of March 31, 2021. Common Stock Sales On December 30, 2020, the Company sold 900,000 shares of its common stock to its Chairman of the Board in exchange for proceeds of $20,250. Debt Conversions On February 22, 2021, a convertible noteholder converted $90,000 of principal into 3,000,000 shares at a conversion price of $0.03 per share. The note was converted in accordance with the conversion terms; therefore, no gain or loss has been recognized. On December 29, 2020, the three holders of the Company’s 9% Secured Convertible Notes converted debt in the aggregate original principal amount of $110,000 into an aggregate of 3,666,668 shares at a conversion price of $0.03 per share. The note was converted in accordance with the conversion terms; therefore, no gain or loss has been recognized. Common Stock Issued for Services, Related Parties On March 25, 2021, the Company issued 266,430 shares of common stock to its CFO for services rendered pursuant to his employment agreement. The aggregate fair value of the common stock was $15,000 based on the closing price of the Company’s common stock on the date of grant, and was expensed over the requisite service period. On March 25, 2021, the Board approved the issuance of 200,000 shares of Common Stock as a bonus to each of Edmond A. DeFrank, Dennis Hartmann and Bruce Raben, or 600,000 shares in the aggregate. The aggregate fair value of the common stock was $33,780 based on the closing price of the Company’s common stock on the date of grant, and was expensed over the requisite service period. On December 25, 2020, the Company issued 728,155 shares of common stock to its CFO for services rendered pursuant to his employment agreement. The aggregate fair value of the common stock was $15,000 based on the closing price of the Company’s common stock on the date of grant, and was expensed over the requisite service period. Common Stock Issued for Services On March 25, 2021, the Company issued 250,000 shares of common stock to a consultant as a bonus for services rendered. The aggregate fair value of the common stock was $14,075 based on the closing price of the Company’s common stock on the date of grant, and was expensed over the requisite service period. On December 28, 2020, the Company issued 500,000 shares of common stock to a consultant for services rendered pursuant to his consulting agreement. The aggregate fair value of the common stock was $12,000 based on the closing price of the Company’s common stock on the date of grant, and was expensed over the requisite service period. Amortization of Stock-Based Compensation A total of $41,126 of stock-based compensation expense was recognized from the amortization of options and warrants over their vesting period during the six months ended March 31, 2021. |
Common Stock Options
Common Stock Options | 6 Months Ended |
Mar. 31, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Common Stock Options | Note 13 – Common Stock Options Stock Incentive Plan On June 21, 2016, we amended and restated our 2012 Stock Incentive Plan (the “2012 Plan”), which was originally adopted on March 5, 2012 and previously amended on May 20, 2014. As amended, the 2012 Plan provides for the issuance of up to 11,500,000 shares of common stock pursuant to the grant of options or other awards, including stock grants, to employees, officers or directors of, and consultants to, the Company and its subsidiaries. Options granted under the 2012 Plan may either be intended to qualify as incentive stock options under the Internal Revenue Code of 1986, or may be non-qualified options, and are exercisable over periods not exceeding ten years from date of grant. A total of 3,120,000 options were outstanding as of March 31, 2021. During the six months ended March 31, 2021, options to purchase an aggregate total of 750,000 shares of common stock at a weighted average exercise price of $0.10 per share expired. Options Granted On March 25, 2021, we granted options to an individual to purchase 300,000 shares of the Company’s common stock, having an exercise price of $0.06 per share, exercisable over a ten-year term. The options are fully vested. The estimated value using the Black-Scholes Pricing Model, based on a volatility rate of 167% and a call option value of $0.0527, was $15,822, resulting in $15,822 of stock-based compensation expense during the three months ended March 31, 2021. Options Forfeited On December 30, 2020, a total of 750,000 options with a weighted average exercise price of $0.10 were forfeited. |
Common Stock Warrants
Common Stock Warrants | 6 Months Ended |
Mar. 31, 2021 | |
Equity [Abstract] | |
Common Stock Warrants | Note 14 – Common Stock Warrants Warrants to purchase a total of 3,877,024 shares of common stock were outstanding as of March 31, 2021. During the six months ended March 31, 2021, warrants to purchase an aggregate total of 397,245 shares of common stock at a weighted average exercise price of $0.26 per share expired. |
Other Income (Expense)
Other Income (Expense) | 6 Months Ended |
Mar. 31, 2021 | |
Other Income and Expenses [Abstract] | |
Other Income (Expense) | Note 15 – Other Income (Expense) Other income (expense) for the six months ended March 31, 2021 and 2020 consisted of the following: March 31, 2021 2020 Gain on early extinguishment of debt $ 40,338 $ - Settlement of accrued wages owed to former CEO with distribution of assets 7,580 - Rental income on subleases - 42,000 Interest expense (74,710 ) (65,434 ) $ (26,792 ) $ (23,434 ) |
Income Tax
Income Tax | 6 Months Ended |
Mar. 31, 2021 | |
Income Tax Disclosure [Abstract] | |
Income Tax | Note 16 - Income Tax The Company accounts for income taxes under FASB ASC 740-10, which requires use of the liability method. FASB ASC 740-10-25 provides that deferred tax assets and liabilities are recorded based on the differences between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes, referred to as temporary differences. For the six months ended March 31, 2021 and the year ended September 30, 2020, the Company incurred a net operating loss and, accordingly, no provision for income taxes has been recorded. In addition, no benefit for income taxes has been recorded due to the uncertainty of the realization of any tax assets. At March 31, 2021, the Company had approximately $13,030,000 of federal net operating losses. The net operating loss carry forwards, if not utilized, will begin to expire in 2031. Based on the available objective evidence, including the Company’s history of its loss, management believes it is more likely than not that the net deferred tax assets will not be fully realizable. Accordingly, the Company provided for a full valuation allowance against its net deferred tax assets at March 31, 2021 and September 30, 2020, respectively. In accordance with FASB ASC 740, the Company has evaluated its tax positions and determined there are no uncertain tax positions. |
Subsequent Events
Subsequent Events | 6 Months Ended |
Mar. 31, 2021 | |
Subsequent Events [Abstract] | |
Subsequent Events | Note 17 – Subsequent Events Short Term Advance On April 29, 2021, the Company received $25,000 as a short-term loan from one of our convertible noteholders. The loan bears interest at the rate of 8% per annum. |
Organization, Basis of Presen_2
Organization, Basis of Presentation and Significant Accounting Policies (Policies) | 6 Months Ended |
Mar. 31, 2021 | |
Accounting Policies [Abstract] | |
Organization | Organization Digipath, Inc. was incorporated in Nevada on October 5, 2010. Digipath, Inc. and its subsidiaries (“Digipath,” the “Company,” “we,” “our” or “us”) is a service-oriented independent testing laboratory, data analytics and media firm focused on the developing cannabis and hemp markets, and supports the cannabis industry’s best practices for reliable testing, cannabis education and training. Our mission is to provide pharmaceutical-grade analysis and testing to the cannabis industry, under ISO-17025:2017 guidelines, to ensure consumers and patients know exactly what is in the cannabis they ingest and to help maximize the quality of our clients’ products through research, development, and standardization. Digipath has been operating a cannabis-testing lab in Nevada since 2015 and hopes to open labs in other states that have legalized the sale of cannabis, beginning with California or Arizona. |
Basis of Presentation | Basis of Presentation The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”). Intercompany accounts and transactions have been eliminated. The unaudited condensed consolidated financial statements of the Company and the accompanying notes included in this Quarterly Report on Form 10-Q are unaudited. In the opinion of management, all adjustments necessary for a fair presentation of the Condensed Consolidated Financial Statements have been included. Such adjustments are of a normal, recurring nature. The Condensed Consolidated Financial Statements, and the accompanying notes, are prepared in accordance with GAAP and do not contain certain information included in the Company’s Annual Report on Form 10-K for the fiscal year ended September 30, 2020. The interim Condensed Consolidated Financial Statements should be read in conjunction with that Annual Report on Form 10-K. Results for the interim periods presented are not necessarily indicative of the results that might be expected for the entire fiscal year. |
Principles of Consolidation | Principles of Consolidation The accompanying consolidated financial statements include the accounts of the following entities, all of which were under common control and ownership at March 31, 2021: Jurisdiction of Name of Entity (1) Incorporation Relationship Digipath, Inc. (2) Nevada Parent Digipath Labs, Inc. Nevada Subsidiary TNM News, Inc. Nevada Subsidiary Digipath Labs S.A.S. (3) Colombia Subsidiary VSSL Enterprises, Ltd. (4) Canada Subsidiary (1) (2) Holding company, which owns each of the wholly-owned subsidiaries. All subsidiaries shown above are wholly-owned by Digipath, Inc., the parent company. (3) Formed during the first fiscal quarter of 2019, but has not yet commenced significant operations. (4) Acquired on March 11, 2020. The consolidated financial statements herein contain the operations of the wholly-owned subsidiaries listed above. All significant inter-company transactions have been eliminated in the preparation of these financial statements. The parent company and subsidiaries will be collectively referred to herein as the “Company”, “Digipath” or “DIGP”. The Company’s headquarters are located in Las Vegas, Nevada and substantially all of its customers are within the United States. These statements reflect all adjustments, consisting of normal recurring adjustments, which in the opinion of management are necessary for fair presentation of the information contained therein. |
Segment Reporting | Segment Reporting ASC Topic 280, “Segment Reporting,” requires use of the “management approach” model for segment reporting. The management approach model is based on the way a company’s management organizes segments within the company for making operating decisions and assessing performance. The Company operates as a single segment and will evaluate additional segment disclosure requirements as it expands its operations. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments Under FASB ASC 820-10-05, the Financial Accounting Standards Board establishes a framework for measuring fair value in generally accepted accounting principles and expands disclosures about fair value measurements. This Statement reaffirms that fair value is the relevant measurement attribute. The adoption of this standard did not have a material effect on the Company’s financial statements as reflected herein. The carrying amounts of cash, accounts receivable, accounts payable and accrued expenses reported on the balance sheets are estimated by management to approximate fair value primarily due to the short-term nature of the instruments. |
Revenue Recognition | Revenue Recognition The Company recognizes revenue in accordance with ASC 606 — Revenue from Contracts with Customers. Under ASC 606, the Company recognizes revenue from the sale of lab testing services through our subsidiary Digipath Labs, Inc. Revenue is primarily generated through our subsidiary, Digipath Labs, Inc., which recognizes revenue from the analytical testing of cannabis products for licensed producers and cultivators within the state of Nevada on a determinable fixed fee per test, or panel of tests basis. Revenue from the performance of those services is recognized upon completion of the tests, at which time test results are delivered to the customer, provided collectability of the fee is reasonably assured. We typically require payment within thirty days of the delivery of results. Management estimates an allowance for doubtful accounts based on the aging of its receivables. |
Stock-Based Compensation | Stock-Based Compensation The Company accounts for equity instruments issued to employees in accordance with the provisions of ASC 718 Stock Compensation (ASC 718) and Equity-Based Payments to Non-employees pursuant to ASC 2018-07 (ASC 2018-07). All transactions in which goods or services are the consideration received for the issuance of equity instruments are accounted for based on the fair value of the consideration received or the fair value of the equity instrument issued, whichever is more reliably measurable. The measurement date of the fair value of the equity instrument issued is the earlier of the date on which the counterparty’s performance is complete or the date at which a commitment for performance by the counterparty to earn the equity instruments is reached because of sufficiently large disincentives for nonperformance. |
Adoption of New Accounting Standards and Recently Issued Accounting Pronouncements | Adoption of New Accounting Standards and Recently Issued Accounting Pronouncements From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board (“FASB”) that are adopted by the Company as of the specified effective date. If not discussed, management believes that the impact of recently issued standards, which are not yet effective, will not have a material impact on the Company’s financial statements upon adoption. In August 2020, the FASB issued Accounting Standard Update (“ASU”) No. 2020-06, Debt–Debt with Conversion and Other Options and Derivatives and Hedging–Contracts in Entity’s Own Equity : Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity In November 2019, the FASB issued ASU 2019 - Income Taxes ): Simplifying the Accounting for Income Taxes - - . No other new accounting pronouncements, issued or effective during the period ended March 31, 2021, have had or are expected to have a significant impact on the Company’s financial statements. |
Organization, Basis of Presen_3
Organization, Basis of Presentation and Significant Accounting Policies (Tables) | 6 Months Ended |
Mar. 31, 2021 | |
Accounting Policies [Abstract] | |
Schedule of Entities Under Common Control and Ownership | The accompanying consolidated financial statements include the accounts of the following entities, all of which were under common control and ownership at March 31, 2021: Jurisdiction of Name of Entity (1) Incorporation Relationship Digipath, Inc. (2) Nevada Parent Digipath Labs, Inc. Nevada Subsidiary TNM News, Inc. Nevada Subsidiary Digipath Labs S.A.S. (3) Colombia Subsidiary VSSL Enterprises, Ltd. (4) Canada Subsidiary (1) (2) Holding company, which owns each of the wholly-owned subsidiaries. All subsidiaries shown above are wholly-owned by Digipath, Inc., the parent company. (3) Formed during the first fiscal quarter of 2019, but has not yet commenced significant operations. (4) Acquired on March 11, 2020. |
Fair Value of Financial Instr_2
Fair Value of Financial Instruments (Tables) | 6 Months Ended |
Mar. 31, 2021 | |
Fair Value Disclosures [Abstract] | |
Summary of Financial Instruments at Fair Value on Recurring Basis | The following schedule summarizes the valuation of financial instruments at fair value on a recurring basis in the balance sheets as of March 31, 2021 and September 30, 2020, respectively: Fair Value Measurements at March 31, 2021 Level 1 Level 2 Level 3 Assets Cash $ 113,706 $ - $ - Total assets 113,706 - - Liabilities Short term advances - 90,112 - Lease liabilities - - 503,536 Notes payable - 406,341 - Convertible notes payable - - 1,160,000 Total liabilities - 496,453 1,663,536 $ 113,706 $ (496,453 ) $ (1,663,536 ) Fair Value Measurements at September 30, 2020 Level 1 Level 2 Level 3 Assets Cash $ 82,749 $ - $ - Total assets 82,749 - - Liabilities Short term advances - 50,112 - Lease liabilities - - 561,394 Notes payable - 473,224 - Convertible notes payable, net of discounts of $8,322 - - 1,241,678 Total liabilities - 523,336 1,803,072 $ 82,749 $ (523,336 ) $ (1,803,072 ) |
Other Current Assets (Tables)
Other Current Assets (Tables) | 6 Months Ended |
Mar. 31, 2021 | |
Other Current Assets | |
Schedule of Other Current Assets | Other current assets consist of the following: March 31, September 30, 2021 2020 Prepaid expenses $ 35,612 $ 48,151 Other receivable 5,384 5,522 Total other current assets $ 40,996 $ 53,673 |
Fixed Assets (Tables)
Fixed Assets (Tables) | 6 Months Ended |
Mar. 31, 2021 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Fixed Assets | Fixed assets consist of the following at March 31, 2021 and September 30, 2020: March 31, September 30, 2021 2020 Software $ 125,903 $ 124,697 Office equipment 71,601 74,777 Furniture and fixtures 29,879 29,879 Lab equipment 1,398,716 1,398,716 Leasehold improvements 494,117 494,117 Lab equipment held under capital leases 99,193 99,193 2,219,409 2,221,379 Less: accumulated depreciation (1,494,234 ) (1,335,974 ) Total $ 725,175 $ 885,405 |
Leases (Tables)
Leases (Tables) | 6 Months Ended |
Mar. 31, 2021 | |
Leases [Abstract] | |
Schedule of Components of Lease Expense | The components of lease expense were as follows: For the Six Months Ended March 31, 2021 Finance lease cost $ 21,644 Operating lease cost: Amortization of assets 45,308 Interest on lease liabilities 14,129 Total lease cost $ 59,437 |
Schedule of Supplemental Balance Sheet Information | Supplemental balance sheet information related to leases was as follows: March 31, 2021 Operating leases: Operating lease assets $ 460,398 Current portion of operating lease liabilities $ 89,078 Noncurrent operating lease liabilities 378,262 Total operating lease liabilities $ 467,340 Finance lease: Equipment, at cost $ 99,193 Accumulated amortization (29,758 ) Equipment, net $ 69,435 Current portion of finance lease liability $ 33,146 Noncurrent finance lease liability 3,050 Total finance lease liability $ 36,196 Weighted average remaining lease term: Operating leases 4.42 years Finance leases 1.05 years Weighted average discount rate: Operating leases 5.75 % Finance lease 18.41 % |
Schedule of Supplemental Cash Flow and Other Information | Supplemental cash flow and other information related to leases was as follows: For the Six Months Ended March 31, 2021 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows used for operating leases $ 41,143 Financing cash flows used for finance leases $ 16,715 |
Schedule of Future Minimum Annual Lease Commitments Under Operating Leases | The following is a maturity analysis of the annual undiscounted cash flows of the operating lease liabilities on a fiscal year basis, including common area maintenance fees, under non-cancelable operating leases as of March 31, 2021: Fiscal Year Ending Minimum Lease September 30, Commitments 2021 (for the six months remaining) $ 56,511 2022 115,550 2023 119,468 2024 123,543 2025 116,891 $ 531,963 |
Schedule of Future Minimum Annual Lease Payments Under Finance Lease | Future minimum annual lease payments required under the finance lease and the present value of the net minimum lease payments are as follows at March 31, 2021: Finance Leases 2021 (for the six months remaining) $ 18,553 2022 21,644 Total minimum lease payments 40,197 Less interest 4,001 Present value of lease liabilities 36,196 Less current portion 33,146 Long-term lease liabilities $ 3,050 |
Short Term Advances (Tables)
Short Term Advances (Tables) | 6 Months Ended |
Mar. 31, 2021 | |
Debt Disclosure [Abstract] | |
Schedule of Short Term Advances | Short term advances consist of the following at March 31, 2021 and September 30, 2020, respectively: March 31, September 30, 2021 2020 On March 23, 2021, we received $40,000 as a short-term loan from one of our convertible noteholders. The loan bears interest at the rate of 8% per annum. $ 40,000 $ - On July 20, 2020, we received $30,112 as a short-term loan from one of our convertible noteholders. The loan bears interest at the rate of 8% per annum. 30,112 30,112 On January 21, 2020, we received $20,000 as a short-term loan from one of our convertible noteholders. No interest expense was recognized. 20,000 20,000 Total short term advances $ 90,112 $ 50,112 |
Notes Payable (Tables)
Notes Payable (Tables) | 6 Months Ended |
Mar. 31, 2021 | |
Debt Disclosure [Abstract] | |
Schedule of Notes Payable | Notes payable consists of the following at March 31, 2021 and September 30, 2020, respectively: March 31, September 30, 2021 2020 On June 22, 2020, the Company, borrowed $40,114 from Cross River Bank, pursuant to a Promissory Note issued by the Company to Cross River Bank (the “Company PPP Note”). The loan was made pursuant to the Payroll Protection Program established as part of the Coronavirus Aid, Relief, and Economic Security Act (the “Payroll Protection Program”). The Company PPP Note carried interest at 1.00% per annum, payable monthly beginning December 22, 2020, and was due on June 22, 2025. On January 12, 2021, the PPP Note and interest was forgiven, resulting in a gain on early extinguishment of debt in the amount of $40,338. $ - $ 40,114 On May 13, 2020, the Company, through its wholly-owned subsidiary Digipath Labs, Inc. (“Labs”), borrowed $179,920 from WebBank Corp, pursuant to a Promissory Note issued by Labs to WebBank Corp (the “Labs PPP Note”). The loan was made pursuant to the Payroll Protection Program. The Labs PPP Note bears interest at 1.00% per annum, payable monthly beginning December 13, 2020, and is due on May 13, 2022. The Labs PPP Note may be repaid at any time without penalty. 179,920 179,920 On December 26, 2019, the Company financed the purchase of $377,124 of lab equipment, in part, with the proceeds of a bank loan in the amount of $291,931. The loan bears interest at the rate of 5.75% per annum and requires monthly payments of $5,622 over the five-year term of the loan ending on December 26, 2024. The Company’s obligations under this loan are secured by a lien on the purchased equipment. 226,421 253,190 Total notes payable 406,341 473,224 Less: current maturities (55,898 ) (54,317 ) Notes payable $ 350,443 $ 418,907 |
Convertible Notes Payable (Tabl
Convertible Notes Payable (Tables) | 6 Months Ended |
Mar. 31, 2021 | |
Debt Disclosure [Abstract] | |
Schedule of Convertible Notes Payable | Convertible notes payable consists of the following at March 31, 2021 and September 30, 2020, respectively: March 31, September 30, 2021 2020 On February 11, 2020, the Company completed the sale to an accredited investor of a 9% Secured Convertible Promissory Note in the principal amount of $50,000. The Note matures on August 11, 2022, bears interest at a rate of 9% per annum, and was convertible into shares of the Company’s common stock at a conversion price of $0.15 per share. On December 28, 2020, the conversion price was amended to $0.03 per share in exchange for an additional $10,000 of proceeds and the promissory note was increased to $60,000. The Company’s obligations under the Note are secured by a lien on the assets of the Company and its wholly-owned subsidiary Digipath Labs, Inc., pursuant to a Security Agreement between the Company, Digipath Labs, Inc. and the investor. On December 29, 2020, the note holder converted $10,000 of principal into 333,334 shares of common stock at a conversion price of $0.03 per share. $ 50,000 $ 50,000 On February 11, 2020, the Company completed the sale to an accredited investor of a 9% Secured Subordinated Convertible Promissory Note in the principal amount of $150,000. The Note matures on August 11, 2022, bears interest at a rate of 9% per annum, and was convertible into shares of the Company’s common stock at a conversion price of $0.15 per share. On December 28, 2020, the conversion price was amended to $0.03 per share in exchange for an additional $50,000 of proceeds and the promissory note was increased to $200,000. The Company’s obligations under the Note are secured by subordinated lien on the assets of the Company and its wholly-owned subsidiary Digipath Labs, Inc., pursuant to a Security Agreement between the Company, Digipath Labs, Inc. and the investor. On December 29, 2020, the note holder converted $50,000 of principal into 1,666,667 shares of common stock at a conversion price of $0.03 per share. 150,000 150,000 On February 10, 2020, the Company completed the sale to an accredited investor of a 9% Secured Convertible Promissory Note in the principal amount of $350,000. The Note matures on August 10, 2022, bears interest at a rate of 9% per annum, and was convertible into shares of the Company’s common stock at a conversion price of $0.15 per share. On December 28, 2020, the conversion price was amended to $0.03 per share in exchange for an additional $50,000 of proceeds that were received on January 4, 2021, and the promissory note was increased to $400,000. The Company’s obligations under the Note are secured by a lien on the assets of the Company and its wholly-owned subsidiary Digipath Labs, Inc., pursuant to a Security Agreement between the Company, Digipath Labs, Inc. and the investor. On December 29, 2020, the note holder converted $50,000 of principal into 1,666,667 shares of common stock at a conversion price of $0.03 per share. 350,000 350,000 On September 23, 2019, the Company received proceeds of $200,000 on a senior secured convertible note that carries an 8% interest rate, which matures on August 10, 2022, as amended. The principal and interest were convertible into shares of common stock at the discretion of the note holder at a fixed conversion price of $0.11 per share. On September 30, 2020, the maturity date was extended to August 10, 2022 and the conversion price was amended to $0.03 per share. The Company’s obligations under this Note are secured by a lien on the assets of the Company and its wholly-owned subsidiary Digipath Labs, Inc. On February 22, 2021, the noteholder converted $90,000 of principal into 3,000,000 shares of common stock at a conversion price of $0.03 per share. 110,000 200,000 On November 8, 2018, the Company received proceeds of $350,000 on a senior secured convertible note that carries an 8% interest rate, which matures on August 10, 2022, as amended. The principal and interest were convertible into shares of common stock at the discretion of the note holder at a fixed conversion price of $0.14 per share. On September 30, 2020, the maturity date was extended to August 10, 2022 and the conversion price was amended to $0.03 per share. The Company’s obligations under this Note are secured by a lien on the assets of the Company and its wholly-owned subsidiary Digipath Labs, Inc. A total of $4,066 of interest was repaid during the year ended September 30, 2019. 350,000 350,000 On November 5, 2018, the Company received proceeds of $150,000 on a senior secured convertible note that carries an 8% interest rate, which matures on August 10, 2022, as amended. The principal and interest were convertible into shares of common stock at the discretion of the note holder at a fixed conversion price of $0.14 per share. On September 30, 2020, the maturity date was extended to August 10, 2022 and the conversion price was amended to $0.03 per share. The Company’s obligations under this Note are secured by a lien on the assets of the Company and its wholly-owned subsidiary Digipath Labs, Inc. 150,000 150,000 Total convertible notes payable 1,160,000 1,250,000 Less: unamortized debt discounts - (8,322 ) 1,160,000 1,241,678 Less: current maturities - - Convertible notes payable $ 1,160,000 $ 1,241,678 |
Schedule of Interest Expense | The Company recognized interest expense for the six months ended March 31, 2021 and 2020, respectively, as follows: March 31, March 31, 2021 2020 Interest on short term loans $ 1,687 $ - Interest on capital leases 4,929 6,131 Interest on notes payable 7,970 7,955 Amortization of beneficial conversion features 8,322 16,552 Interest on convertible notes 51,802 34,796 Total interest expense $ 74,710 $ 65,434 |
Other Income (Expense) (Tables)
Other Income (Expense) (Tables) | 6 Months Ended |
Mar. 31, 2021 | |
Other Income and Expenses [Abstract] | |
Schedule of Other Income (Expense) | Other income (expense) for the six months ended March 31, 2021 and 2020 consisted of the following: March 31, 2021 2020 Gain on early extinguishment of debt $ 40,338 $ - Settlement of accrued wages owed to former CEO with distribution of assets 7,580 - Rental income on subleases - 42,000 Interest expense (74,710 ) (65,434 ) $ (26,792 ) $ (23,434 ) |
Organization, Basis of Presen_4
Organization, Basis of Presentation and Significant Accounting Policies (Details Narrative) | 6 Months Ended |
Mar. 31, 2021Segment | |
Accounting Policies [Abstract] | |
Entity incorporation, date of incorporation | Oct. 5, 2010 |
Entity incorporation, state or country code | NV |
Number of reportable segment | 1 |
Organization, Basis of Presen_5
Organization, Basis of Presentation and Significant Accounting Policies - Schedule of Entities Under Common Control and Ownership (Details) | 6 Months Ended | |
Mar. 31, 2021 | ||
Entities Under Common Control and Ownership One [Member] | ||
Name of Entity | Digipath, Inc. | [1],[2] |
Jurisdiction of Incorporation | Nevada | |
Relationship | Parent | |
Entities Under Common Control and Ownership Two [Member] | ||
Name of Entity | Digipath Labs, Inc. | [1] |
Jurisdiction of Incorporation | Nevada | |
Relationship | Subsidiary | |
Entities Under Common Control and Ownership Three [Member] | ||
Name of Entity | TNM News, Inc. | [1] |
Jurisdiction of Incorporation | Nevada | |
Relationship | Subsidiary | |
Entities Under Common Control and Ownership Four [Member] | ||
Name of Entity | Digipath Labs S.A.S. | [1],[3] |
Jurisdiction of Incorporation | Colombia | |
Relationship | Subsidiary | |
Entities Under Common Control and Ownership Five [Member] | ||
Name of Entity | VSSL Enterprises, Ltd | [1],[4] |
Jurisdiction of Incorporation | Canada | |
Relationship | Subsidiary | |
[1] | All entities are in the form of a corporation. | |
[2] | Holding company, which owns each of the wholly-owned subsidiaries. All subsidiaries shown above are wholly-owned by Digipath, Inc., the parent company. | |
[3] | Formed during the first fiscal quarter of 2019, but has not yet commenced significant operations. | |
[4] | Acquired on March 11, 2020. |
Going Concern (Details Narrativ
Going Concern (Details Narrative) - USD ($) | Mar. 31, 2021 | Sep. 30, 2020 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Accumulated deficit | $ (17,637,586) | $ (17,265,150) |
Working capital | $ (404,176) |
Related Party Transactions (Det
Related Party Transactions (Details Narrative) - USD ($) | Mar. 25, 2021 | Dec. 30, 2020 | Dec. 25, 2020 | Dec. 25, 2020 | Mar. 31, 2021 | Mar. 31, 2020 | Mar. 31, 2021 | Mar. 31, 2020 |
Common stock shares issued for services, value | $ 33,780 | $ 14,075 | $ 29,963 | $ 26,075 | $ 54,713 | |||
Common Stock [Member] | ||||||||
Common stock issued for services, shares | 250,000 | 998,756 | 750,000 | 1,169,989 | ||||
Common stock shares issued for services, value | $ 250 | $ 999 | $ 750 | $ 1,171 | ||||
Directors [Member] | ||||||||
Quarterly installments | $ 7,500 | |||||||
Number of shares of common stock | 200,000 | |||||||
Fair value of common stock | $ 33,780 | |||||||
Directors [Member] | Minimum [Member] | ||||||||
Annual compensation | 18,000 | |||||||
Directors [Member] | Maximum [Member] | ||||||||
Annual compensation | 30,000 | |||||||
Chairman [Member] | ||||||||
Quarterly installments | 15,000 | |||||||
Chairman [Member] | Common Stock [Member] | ||||||||
Common stock sold for cash, shares | 900,000 | |||||||
Proceeds from sale of common stock | $ 20,250 | |||||||
Chairman [Member] | Minimum [Member] | ||||||||
Annual compensation | 30,000 | |||||||
Chairman [Member] | Maximum [Member] | ||||||||
Annual compensation | $ 60,000 | |||||||
Chief Financial Officer [Member] | ||||||||
Common stock issued for services, shares | 728,155 | |||||||
Common stock shares issued for services, value | $ 15,000 | |||||||
Chief Financial Officer [Member] | Employment Agreement [Member] | ||||||||
Common stock issued for services, shares | 266,430 | 728,155 | ||||||
Common stock shares issued for services, value | $ 15,000 | $ 15,000 |
Fair Value of Financial Instr_3
Fair Value of Financial Instruments (Details Narrative) - USD ($) | Mar. 31, 2021 | Sep. 30, 2020 |
Fair Value Disclosures [Abstract] | ||
Convertible debentures | $ 1,160,000 | $ 1,250,000 |
Convertible notes discounts | $ 8,322 |
Fair Value of Financial Instr_4
Fair Value of Financial Instruments - Summary of Financial Instruments at Fair Value on Recurring Basis (Details) - USD ($) | Mar. 31, 2021 | Sep. 30, 2020 |
Level 1 [Member] | ||
Cash | $ 113,706 | $ 82,749 |
Total assets | 113,706 | 82,749 |
Short term advances | ||
Lease liabilities | ||
Note payable | ||
Convertible notes payable, net of discounts | ||
Total liabilities | ||
Total | 113,706 | 82,749 |
Level 2 [Member] | ||
Cash | ||
Total assets | ||
Short term advances | 90,112 | 50,112 |
Lease liabilities | ||
Note payable | 406,341 | 473,224 |
Convertible notes payable, net of discounts | ||
Total liabilities | 496,453 | 523,336 |
Total | (496,453) | (523,336) |
Level 3 [Member] | ||
Cash | ||
Total assets | ||
Short term advances | ||
Lease liabilities | 503,536 | 561,394 |
Note payable | ||
Convertible notes payable, net of discounts | 1,160,000 | 1,241,678 |
Total liabilities | 1,663,536 | 1,803,072 |
Total | $ (1,663,536) | $ (1,803,072) |
Fair Value of Financial Instr_5
Fair Value of Financial Instruments - Summary of Financial Instruments at Fair Value on Recurring Basis (Details) (Parenthetical) - USD ($) | Mar. 31, 2021 | Sep. 30, 2020 |
Fair Value Disclosures [Abstract] | ||
Convertible notes discounts | $ 8,322 |
Accounts Receivable (Details Na
Accounts Receivable (Details Narrative) - USD ($) | Mar. 31, 2021 | Sep. 30, 2020 |
Receivables [Abstract] | ||
Accounts receivable | $ 210,730 | $ 242,145 |
Allowance for uncollectible accounts | $ 110,243 | $ 128,944 |
Other Current Assets - Schedule
Other Current Assets - Schedule of Other Current Assets (Details) - USD ($) | Mar. 31, 2021 | Sep. 30, 2020 |
Other Current Assets | ||
Prepaid expenses | $ 35,612 | $ 48,151 |
Other receivable | 5,384 | 5,522 |
Total other current assets | $ 40,996 | $ 53,673 |
Fixed Assets (Details Narrative
Fixed Assets (Details Narrative) - USD ($) | 6 Months Ended | ||
Mar. 31, 2021 | Mar. 31, 2020 | Sep. 30, 2020 | |
Fixed assets | $ 725,175 | $ 885,405 | |
Accumulated depreciation | 1,494,234 | $ 1,335,974 | |
Depreciation and amortization expense | 159,209 | $ 156,171 | |
Former CEO [Member] | |||
Fixed assets | 2,227 | ||
Former CEO [Member] | Office Equipment [Member] | |||
Fixed assets | 3,176 | ||
Accumulated depreciation | 949 | ||
Loss of assets | $ 2,227 |
Fixed Assets - Schedule of Fixe
Fixed Assets - Schedule of Fixed Assets (Details) - USD ($) | Mar. 31, 2021 | Sep. 30, 2020 |
Property, Plant and Equipment [Abstract] | ||
Software | $ 125,903 | $ 124,697 |
Office equipment | 71,601 | 74,777 |
Furniture and fixtures | 29,879 | 29,879 |
Lab equipment | 1,398,716 | 1,398,716 |
Leasehold improvements | 494,117 | 494,117 |
Lab equipment held under capital leases | 99,193 | 99,193 |
Fixed assets, gross | 2,219,409 | 2,221,379 |
Less: accumulated depreciation | (1,494,234) | (1,335,974) |
Total | $ 725,175 | $ 885,405 |
Leases - Schedule of Components
Leases - Schedule of Components of Lease Expense (Details) | 6 Months Ended |
Mar. 31, 2021USD ($) | |
Leases [Abstract] | |
Finance lease cost | $ 21,644 |
Amortization of assets | 45,308 |
Interest on lease liabilities | 14,129 |
Total lease cost | $ 59,437 |
Leases - Schedule of Supplement
Leases - Schedule of Supplemental Balance Sheet Information (Details) - USD ($) | Mar. 31, 2021 | Sep. 30, 2020 |
Leases [Abstract] | ||
Operating lease assets | $ 460,398 | $ 505,706 |
Current portion of operating lease liabilities | 89,078 | 84,731 |
Noncurrent operating lease liabilities | 378,262 | 423,752 |
Total operating lease liabilities | 467,340 | |
Equipment, at cost | 99,193 | |
Accumulated amortization | (29,758) | |
Equipment, net | 69,435 | |
Current portion of finance lease liability | 33,146 | 32,532 |
Noncurrent finance lease liability | 3,050 | $ 20,379 |
Total finance lease liability | $ 36,196 | |
Operating leases | 4 years 5 months 1 day | |
Finance leases | 1 year 18 days | |
Operating leases | 5.75% | |
Finance lease | 18.41% |
Leases - Schedule of Suppleme_2
Leases - Schedule of Supplemental Cash Flow and Other Information (Details) - USD ($) | 6 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Leases [Abstract] | ||
Operating cash flows used for operating leases | $ 41,143 | |
Financing cash flows used for finance leases | $ 16,715 | $ 35,387 |
Leases - Schedule of Future Min
Leases - Schedule of Future Minimum Annual Lease Commitments Under Operating Leases (Details) | Mar. 31, 2021USD ($) |
Leases [Abstract] | |
2021 | $ 56,511 |
2022 | 115,550 |
2023 | 119,468 |
2024 | 123,543 |
2025 | 116,891 |
Operating leases | $ 531,963 |
Leases - Schedule of Future M_2
Leases - Schedule of Future Minimum Annual Lease Payments Under Finance Lease (Details) - USD ($) | Mar. 31, 2021 | Sep. 30, 2020 |
Leases [Abstract] | ||
2021 | $ 18,553 | |
2022 | 21,644 | |
Total minimum lease payments | 40,197 | |
Less interest | 4,001 | |
Present value of lease liabilities | 36,196 | |
Less current portion | 33,146 | $ 32,532 |
Long-term lease liabilities | $ 3,050 | $ 20,379 |
Short Term Advances (Details Na
Short Term Advances (Details Narrative) - USD ($) | 6 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Debt Disclosure [Abstract] | ||
Interest rates on short term loans | $ 1,687 |
Short Term Advances - Schedule
Short Term Advances - Schedule of Short Term Advances (Details) - USD ($) | Mar. 31, 2021 | Sep. 30, 2020 |
Total short term advances | $ 90,112 | $ 50,112 |
Convertible Noteholders [Member] | ||
Total short term advances | 40,000 | |
Convertible Noteholders One [Member] | ||
Total short term advances | 30,112 | 30,112 |
Convertible Noteholders Two [Member] | ||
Total short term advances | $ 20,000 | $ 20,000 |
Short Term Advances - Schedul_2
Short Term Advances - Schedule of Short Term Advances (Details) (Parenthetical) - USD ($) | Mar. 23, 2021 | Jul. 20, 2020 | Jan. 21, 2020 | Mar. 31, 2021 | Mar. 31, 2020 |
Proceeds from short-term loan | $ 40,000 | $ 25,000 | |||
Convertible Notes holder [Member] | |||||
Proceeds from short-term loan | $ 40,000 | $ 30,112 | $ 20,000 | ||
Short term loan rate of interest | 8.00% | 8.00% | |||
Interest expense |
Notes Payable (Details Narrativ
Notes Payable (Details Narrative) - USD ($) | 6 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Note Payable [Member] | ||
Interest expense | $ 7,970 | $ 7,955 |
Notes Payable - Schedule of Not
Notes Payable - Schedule of Notes Payable (Details) - USD ($) | Mar. 31, 2021 | Sep. 30, 2020 |
Total notes payable | $ 406,341 | $ 473,224 |
Less: current maturities | (55,898) | (54,317) |
Note payable | 350,443 | 418,907 |
Company PPP Note [Member] | ||
Total notes payable | 40,114 | |
Labs PPP Note [Member] | ||
Total notes payable | 179,920 | 179,920 |
Bank Loan [Member] | ||
Total notes payable | $ 226,421 | $ 253,190 |
Notes Payable - Schedule of N_2
Notes Payable - Schedule of Notes Payable (Details) (Parenthetical) - USD ($) | Jun. 22, 2020 | Jun. 12, 2020 | May 13, 2020 | Dec. 26, 2019 | Mar. 31, 2021 | Mar. 31, 2020 |
Extinguishment of debt | $ 40,338 | |||||
Note Payable [Member] | ||||||
Debt instrument interest percentage | 5.75% | |||||
Debt instrument maturity date | Dec. 26, 2024 | |||||
Payments for lab equipment | $ 377,124 | |||||
Proceeds from bank loan | 291,931 | |||||
Debt instrument periodic payment | $ 5,622 | |||||
Debt instrument term | 5 years | |||||
Cross River Bank [Member] | Company PPP Note [Member] | ||||||
Proceeds from notes payable | $ 40,114 | |||||
Debt instrument interest percentage | 1.00% | |||||
Debt instrument maturity date | Jun. 22, 2025 | |||||
Extinguishment of debt | $ 40,338 | |||||
WebBank Corp [Member] | Labs PPP Note [Member] | Digipath Labs, Inc [Member] | ||||||
Proceeds from notes payable | $ 179,920 | |||||
Debt instrument interest percentage | 1.00% | |||||
Debt instrument maturity date | May 13, 2022 | |||||
Debt instrument description | Under the Payroll Protection Program, Labs will be eligible for loan forgiveness up to the full amount of the Labs PPP Note and any accrued interest. The forgiveness amount will be equal to the amount that Labs spends during the 8-week period beginning May 13, 2020 on payroll costs, payment of rent on any leases in force prior to February 15, 2020 and payment on any utility for which service began before February 15, 2020. The maximum amount of loan forgiveness for non-payroll expenses is 25% of the amount of the Labs PPP Note. No assurance is provided that Labs will obtain forgiveness under the Labs PPP Note in whole or in part. | |||||
Percentage of loan forgiveness for non-payroll expenses | 25.00% |
Convertible Notes Payable (Deta
Convertible Notes Payable (Details Narrative) - USD ($) | 6 Months Ended | ||
Mar. 31, 2021 | Mar. 31, 2020 | Sep. 30, 2020 | |
Convertible notes discounts | $ 8,322 | ||
Amortization of debt discount | $ 8,322 | $ 16,552 | |
Maximum Share Amount [Member] | |||
Maximum amount owned percentage of issued and outstanding common shares | 4.99% | ||
Convertible Notes Payable [Member] | |||
Convertible notes discounts | $ 70,964 | ||
Amortization of debt discount | 0 | 8,322 | |
Convertible notes interest expense | $ 51,802 | $ 34,796 |
Convertible Notes Payable - Sch
Convertible Notes Payable - Schedule of Convertible Notes Payable (Details) - USD ($) | Mar. 31, 2021 | Sep. 30, 2020 |
Total convertible notes payable | $ 1,160,000 | $ 1,250,000 |
Less: unamortized debt discounts | (8,322) | |
Total convertible debt | 1,160,000 | 1,241,678 |
Less: current maturities | ||
Convertible notes payable | 1,160,000 | 1,241,678 |
Convertible Notes Payable One [Member] | ||
Total convertible notes payable | 50,000 | 50,000 |
Convertible Notes Payable Two [Member] | ||
Total convertible notes payable | 150,000 | 150,000 |
Convertible Notes Payable Three [Member] | ||
Total convertible notes payable | 350,000 | 350,000 |
Convertible Notes Payable Four [Member] | ||
Total convertible notes payable | 110,000 | 200,000 |
Convertible Notes Payable Five [Member] | ||
Total convertible notes payable | 350,000 | 350,000 |
Convertible Notes Payable Six [Member] | ||
Total convertible notes payable | $ 150,000 | $ 150,000 |
Convertible Notes Payable - S_2
Convertible Notes Payable - Schedule of Convertible Notes Payable (Details) (Parenthetical) - USD ($) | Feb. 22, 2021 | Dec. 29, 2020 | Dec. 28, 2020 | Sep. 30, 2020 | Feb. 11, 2020 | Feb. 10, 2020 | Sep. 23, 2019 | Nov. 08, 2018 | Nov. 05, 2018 | Mar. 31, 2021 | Mar. 31, 2020 | Sep. 30, 2019 |
Proceeds from convertible note | $ 110,000 | $ 550,000 | ||||||||||
Secured Convertible Promissory Note [Member] | Accredited Investors [Member] | ||||||||||||
Debt principal amount | $ 10,000 | $ 60,000 | $ 50,000 | |||||||||
Debt instrument interest percentage | 9.00% | |||||||||||
Debt maturity date | Aug. 11, 2022 | |||||||||||
Conversion price per share | $ 0.03 | $ 0.03 | $ 0.15 | |||||||||
Proceeds from convertible note | $ 10,000 | |||||||||||
Shares of common stock converted | 333,334 | |||||||||||
Secured Subordinated Convertible Promissory Note [Member] | Accredited Investors [Member] | ||||||||||||
Debt principal amount | $ 50,000 | $ 200,000 | $ 150,000 | |||||||||
Debt instrument interest percentage | 9.00% | |||||||||||
Debt maturity date | Aug. 11, 2022 | |||||||||||
Conversion price per share | $ 0.03 | $ 0.03 | $ 0.15 | |||||||||
Proceeds from convertible note | $ 50,000 | |||||||||||
Shares of common stock converted | 1,666,667 | |||||||||||
9% Secured Convertible Promissory Note [Member] | Accredited Investors [Member] | ||||||||||||
Debt principal amount | $ 50,000 | $ 400,000 | $ 350,000 | |||||||||
Debt instrument interest percentage | 9.00% | |||||||||||
Debt maturity date | Aug. 10, 2022 | |||||||||||
Conversion price per share | $ 0.03 | $ 0.03 | $ 0.15 | |||||||||
Proceeds from convertible note | $ 50,000 | |||||||||||
Shares of common stock converted | 1,666,667 | |||||||||||
Senior Secured Convertible Note [Member] | ||||||||||||
Debt principal amount | $ 90,000 | $ 200,000 | ||||||||||
Debt instrument interest percentage | 8.00% | |||||||||||
Debt maturity date | Aug. 10, 2022 | Aug. 10, 2022 | ||||||||||
Conversion price per share | $ 0.03 | $ 0.03 | $ 0.11 | |||||||||
Shares of common stock converted | 3,000,000 | |||||||||||
Extended debt instrument maturity date | On September 30, 2020, the maturity date was extended to August 10, 2022 and the conversion price was amended to $0.03 per share. | |||||||||||
Senior Secured Convertible Note One [Member] | ||||||||||||
Debt principal amount | $ 350,000 | |||||||||||
Debt instrument interest percentage | 8.00% | |||||||||||
Debt maturity date | Aug. 10, 2022 | Aug. 10, 2022 | ||||||||||
Conversion price per share | $ 0.03 | $ 0.14 | ||||||||||
Extended debt instrument maturity date | The maturity date was extended to August 10, 2022 and the conversion price was amended to $0.03 per share. | |||||||||||
Interest paid | $ 4,066 | |||||||||||
Senior Secured Convertible Note Two [Member] | ||||||||||||
Debt principal amount | $ 150,000 | |||||||||||
Debt instrument interest percentage | 8.00% | |||||||||||
Debt maturity date | Aug. 10, 2022 | Aug. 10, 2022 | ||||||||||
Conversion price per share | $ 0.03 | $ 0.14 | ||||||||||
Extended debt instrument maturity date | The maturity date was extended to August 10, 2022 and the conversion price was amended to $0.03 per share. |
Convertible Notes Payable - S_3
Convertible Notes Payable - Schedule of Interest Expense (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2021 | Mar. 31, 2020 | Mar. 31, 2021 | Mar. 31, 2020 | |
Debt Disclosure [Abstract] | ||||
Interest on short term loans | $ 1,687 | |||
Interest on capital leases | 4,929 | 6,131 | ||
Interest on notes payable | 7,970 | 7,955 | ||
Amortization of beneficial conversion features | 8,322 | 16,552 | ||
Interest on convertible notes | 51,802 | 34,796 | ||
Total interest expense | $ 32,337 | $ 35,873 | $ 74,710 | $ 65,434 |
Changes in Stockholders' Equi_2
Changes in Stockholders' Equity (Details Narrative) - USD ($) | Mar. 25, 2021 | Feb. 22, 2021 | Dec. 30, 2020 | Dec. 30, 2020 | Dec. 29, 2020 | Dec. 28, 2020 | Dec. 25, 2020 | Dec. 25, 2020 | Mar. 31, 2021 | Mar. 31, 2020 | Mar. 31, 2021 | Mar. 31, 2020 | Sep. 30, 2020 |
Class of Stock [Line Items] | |||||||||||||
Preferred stock, shares authorized | 10,000,000 | 10,000,000 | 10,000,000 | ||||||||||
Preferred stock, par value | $ 0.001 | $ 0.001 | $ 0.001 | ||||||||||
Preferred stock, shares designated remaining | 4,000,000 | 4,000,000 | |||||||||||
Preferred stock, shares issued | 1,325,942 | 1,325,942 | 1,325,942 | ||||||||||
Preferred stock, shares outstanding | 1,325,942 | 1,325,942 | 1,325,942 | ||||||||||
Common stock par value | $ 0.001 | $ 0.001 | $ 0.001 | ||||||||||
Common stock authorized | 250,000,000 | 250,000,000 | 250,000,000 | ||||||||||
Common stock, shares issued | 68,181,820 | 68,181,820 | 58,270,567 | ||||||||||
Common stock, shares outstanding | 68,181,820 | 68,181,820 | 58,270,567 | ||||||||||
Number of shares authorized to issue | 600,000 | ||||||||||||
Common stock issued for services, value | $ 33,780 | $ 14,075 | $ 29,963 | $ 26,075 | $ 54,713 | ||||||||
Stock-based compensation expense | $ 41,126 | ||||||||||||
Options forfeited | 750,000 | ||||||||||||
Weighted average exercise price | $ 0.10 | ||||||||||||
9% Secured Convertible Notes [Member] | |||||||||||||
Class of Stock [Line Items] | |||||||||||||
Debt instrument face amount | $ 110,000 | ||||||||||||
Number of converted shares | 3,666,668 | ||||||||||||
Conversion price per share | $ 0.03 | ||||||||||||
Debt instrument interest percentage | 9.00% | ||||||||||||
Convertible Noteholder [Member] | |||||||||||||
Class of Stock [Line Items] | |||||||||||||
Debt instrument face amount | $ 90,000 | ||||||||||||
Number of converted shares | 3,000,000 | ||||||||||||
Conversion price per share | $ 0.03 | ||||||||||||
Edmond A. DeFrank [Member] | |||||||||||||
Class of Stock [Line Items] | |||||||||||||
Number of shares authorized to issue | 200,000 | ||||||||||||
Dennis Hartmann [Member] | |||||||||||||
Class of Stock [Line Items] | |||||||||||||
Number of shares authorized to issue | 200,000 | ||||||||||||
Bruce Raben [Member] | |||||||||||||
Class of Stock [Line Items] | |||||||||||||
Number of shares authorized to issue | 200,000 | ||||||||||||
Chief Financial Officer [Member] | |||||||||||||
Class of Stock [Line Items] | |||||||||||||
Common stock issued for services | 728,155 | ||||||||||||
Common stock issued for services, value | $ 15,000 | ||||||||||||
Chief Financial Officer [Member] | Employment Agreement [Member] | |||||||||||||
Class of Stock [Line Items] | |||||||||||||
Common stock issued for services | 266,430 | 728,155 | |||||||||||
Common stock issued for services, value | $ 15,000 | $ 15,000 | |||||||||||
Consultant [Member] | |||||||||||||
Class of Stock [Line Items] | |||||||||||||
Common stock issued for services | 250,000 | ||||||||||||
Common stock issued for services, value | $ 14,075 | ||||||||||||
Consultant [Member] | Consulting Agreement [Member] | |||||||||||||
Class of Stock [Line Items] | |||||||||||||
Common stock issued for services | 500,000 | ||||||||||||
Common stock issued for services, value | $ 12,000 | ||||||||||||
Common Stock [Member] | |||||||||||||
Class of Stock [Line Items] | |||||||||||||
Number of converted shares | 3,000,000 | 6,666,668 | |||||||||||
Common stock issued for services | 250,000 | 998,756 | 750,000 | 1,169,989 | |||||||||
Common stock issued for services, value | $ 250 | $ 999 | $ 750 | $ 1,171 | |||||||||
Common Stock [Member] | Chairman [Member] | |||||||||||||
Class of Stock [Line Items] | |||||||||||||
Number of shares sold, during period | 900,000 | ||||||||||||
Proceeds from sale of stock | $ 20,250 | ||||||||||||
Series A Convertible Preferred Stock [Member] | |||||||||||||
Class of Stock [Line Items] | |||||||||||||
Preferred stock, shares authorized | 6,000,000 | 6,000,000 | |||||||||||
Series A Preferred Stock [Member] | |||||||||||||
Class of Stock [Line Items] | |||||||||||||
Preferred stock, shares issued | 1,325,942 | 1,325,942 | |||||||||||
Preferred stock, shares outstanding | 1,325,942 | 1,325,942 | |||||||||||
Preferred stock convertible into common stock shares | 6,629,710 | 6,629,710 | |||||||||||
Percentage of equity beneficial ownership | 4.99% | 4.99% |
Common Stock Options (Details N
Common Stock Options (Details Narrative) - USD ($) | Mar. 25, 2021 | Jun. 21, 2016 | Mar. 31, 2021 |
Number of options outstanding | 3,120,000 | ||
Number of options granted to purchase shares of common stock | 750,000 | ||
Options exercise price per share | $ 0.10 | ||
Stock-based compensation expense | $ 41,126 | ||
Individual [Member] | |||
Number of options granted to purchase shares of common stock | 300,000 | ||
Options exercise price per share | $ 0.06 | ||
Volatility rate | 167.00% | ||
Call option value | $ 0.0527 | ||
Stock-based compensation expense | $ 15,822 | ||
2012 Stock Incentive Plan [Member] | Maximum [Member] | |||
Number of shares issued under stock plan | 11,500,000 | ||
Options exercisable period | 10 years |
Common Stock Warrants (Details
Common Stock Warrants (Details Narrative) | Mar. 31, 2021$ / sharesshares |
Number of warrant to purchase of common stock shares | 3,877,024 |
Warrants [Member] | |
Number of warrant to purchase of common stock shares | 397,245 |
Warrants exercise price per share | $ / shares | $ 0.26 |
Other Income (Expense) - Schedu
Other Income (Expense) - Schedule of Other Income (Expense) (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2021 | Mar. 31, 2020 | Mar. 31, 2021 | Mar. 31, 2020 | |
Other Income and Expenses [Abstract] | ||||
Gain on early extinguishment of debt | $ 40,338 | |||
Settlement of accrued wages owed to former CEO with distribution of assets | 7,580 | |||
Rental income on subleases | 42,000 | |||
Interest expense | $ (32,337) | $ (35,873) | (74,710) | (65,434) |
Total other income (expense) | $ (26,792) | $ (23,434) |
Income Tax (Details Narrative)
Income Tax (Details Narrative) | 6 Months Ended |
Mar. 31, 2021USD ($) | |
Income Tax Disclosure [Abstract] | |
Net operating loss carry forwards | $ 13,030,000 |
Operating loss expiration year | 2031 |
Subsequent Events (Details Narr
Subsequent Events (Details Narrative) - USD ($) | Apr. 29, 2021 | Mar. 31, 2021 | Sep. 30, 2020 |
Short-term loan | $ 90,112 | $ 50,112 | |
Subsequent Event [Member] | Convertible Noteholders [Member] | |||
Short-term loan | $ 25,000 | ||
Interest rate | 8.00% |