CIMG (IMG) 10-Q 23 Feb 15 2015 Q1 Quarterly report Financial data

Document_And_Entity_Informatio

Document And Entity Information	3 Months Ended
	Dec. 31, 2014	Feb. 05, 2015
Document and Entity Information [Abstract]
Entity Registrant Name	NuZee, Inc.
Document Type	10-Q
Current Fiscal Year End Date	-21
Entity Common Stock, Shares Outstanding		27,443,718
Amendment Flag	FALSE
Entity Central Index Key	1527613
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Entity Filer Category	Smaller Reporting Company
Entity Well-known Seasoned Issuer	No
Document Period End Date	31-Dec-14
Document Fiscal Year Focus	2015
Document Fiscal Period Focus	Q1

NuZee_Inc_Consolidated_Balance

NuZee, Inc. - Consolidated Balance Sheets (USD $)	Dec. 31, 2014	Sep. 30, 2014
Current assets:
Cash	$139,203	$238,160
Accounts receivable	4,884	5,205
Inventories	83,963	50,881
Prepaid expenses and deposits	44,626	69,099
Total current assets	272,676	363,345
Equipment, net	31,750	33,368
Total assets	304,426	396,713
Current liabilities:
Accounts payable	38,381	43,384
Other current liabilities	8,852	8,180
Total current liabilities	47,233	51,564
Stockholders' equity:
Common stock; 100,000,000 shares authorized, $0.00001 par value; 30,619,719 and 30,599,719 shares issued;	306	306
Additional paid in capital	5,160,674	4,968,609
Accumulated deficit	-4,821,047	-4,518,766
Less: treasury stock, at cost (2,156,000 and 2,736,000 shares repurchased, $0.03838 per share)	-82,740	-105,000
Total stockholders' equity	257,193	345,149
Total liabilities and stockholders' equity	$304,426	$396,713

NuZee_Inc_Consolidated_Balance1

NuZee, Inc. - Consolidated Balance Sheets (Parentheticals) (USD $)	3 Months Ended	12 Months Ended
	Dec. 31, 2014	Sep. 30, 2014
Preferred stock; shares authorized	100,000,000	100,000,000
Preferred stock; par value (in Dollars per share)	$0.00	$0.00
Preferred stock; shares issued	0	0
Preferred stock; shares outstanding	0	0
Common stock; shares authorized	100,000,000	100,000,000
Common stock; par value (in Dollars per share)	$0.00	$0.00
Common stock; shares issued	30,619,719	30,599,719
Less: treasury stock, at cost (2,736,000 shares repurchased, 0.03838 per share)	2,736,000	2,736,000
Less: treasury stock, at cost (2,736,000 shares repurchased, 0.03838 per share) (in Dollars per share)	$0.04	$0.04

NeZee_Inc_Consolidated_Stateme

NeZee, Inc. - Consolidated Statements of Operations (USD $)	3 Months Ended
	Dec. 31, 2014	Dec. 31, 2013
Revenues	$41,016
Cost of sales	35,517
Gross Profit (loss)	5,499
Operating expenses	306,980	1,402,880
Loss from operations	-301,481	-1,402,880
Other income		143
Other expense	800
Net loss	($302,281)	($1,402,737)
Basic and diluted loss per common share (in Dollars per share)	($0.01)	$0.05
Basic and diluted weighted average number of common stock outstanding (in Shares)	28,099,371	31,135,757

NuZee_Inc_Consolidated_Stateme

NuZee, Inc. - Consolidated Statements of Cash Flows (USD $)	3 Months Ended
	Dec. 31, 2014	Dec. 31, 2013
Operating activities:
Net loss	($302,281)	($1,402,737)
Adjustments to reconcile net loss to net cash used by operating activities:
Depreciation	1,618	468
Option expense	17,992	1,053,755
Warrant expense	9,134
Change in operating assets and liabilities:
Accounts receivable	321	13,195
Inventories	-33,082	-35,421
Prepaid expenses and deposits	24,473	-46,023
Accounts payable	-5,004	4,538
Other current liabilities	672	-9,563
Net cash used by operating activities	-286,157	-421,788
Investing activities:
Purchase of equipment		-1,927
Net cash used by investing activities		-1,927
Financing activities:
Proceeds from insuance of common stock	13,200
Proceeds from insuance of treasury stock	174,000
Net cash provided by financing activities	187,200
Net change in cash	-98,957	-423,715
Cash, beginning of period	238,160	1,110,661
Cash, end of period	139,203	686,946
Non-cash investing and financing activities:
Forgiveness of related party receivable		139,661
Forgiveness of debt		-50,000
Cancellation of common stocks		($89,661)

1_BASIS_OF_PRESENTATION_AND_SU

1. BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	3 Months Ended
	Dec. 31, 2014
Accounting Policies [Abstract]
Significant Accounting Policies [Text Block]	1.      BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
	The accompanying  unaudited  interim  financial  statements  of  Nuzee,  Inc.  have  been  prepared  in  accordance  with  accounting  principles  generally  accepted  in  the  United  States  of  America  and  rules  of  the  Securities  and  Exchange  Commission,  and  should  be  read  in  conjunction  with  the  audited  financial  statements  and  notes  thereto  contained  in  the  Company’s  annual  report  on  Form  10-K  for  the  initial  period  ended  September  30,  2014  as  filed  with  the  SEC.  In  the  opinion  of  management,  all  adjustments,  consisting  of  normal  recurring  adjustments,  necessary  for  a  fair  presentation  of  financial  position  and  the  results  of  operations  for  the  interim  periods  presented  have  been  reflected  herein.  The  results  of  operations  for  interim  periods  are  not  necessarily  indicative  of  the  results  to  be  expected  for  the  full  year.  Notes  to  the  consolidated  financial  statements  which  would  substantially  duplicate  the  disclosure  contained  in  the  audited  financial  statements  as  reported  in  the  annual  report  on  Form  10-K  have  been  omitted.
	GoingConcern
	The accompanying  financial  statements  have  been  prepared  in  accordance  with  accounting  principles  generally  accepted  in  the  United  States  of  America,  which  contemplates  continuation  of  the  Company  as  a going  concern.  The  Company has  had  recurring  losses,  large  accumulated deficits,  is  dependent  on  the  shareholder  to  provide  additional  funding  for  operating  expenses  and  has  no  recurring  revenues.  These  items  raise  substantial  doubt  about  the  Company’s  ability  to  continue  as  a  going  concern.

2_RELATED_PARTY_TRANSACTIONS

2. RELATED PARTY TRANSACTIONS	3 Months Ended
	Dec. 31, 2014
Related Party Transactions [Abstract]
Related Party Transactions Disclosure [Text Block]	2.          RELATED PARTY TRANSACTIONS
	During November 2014, the Company paid $9,000 for consultation charge of Lotus Cup to an entity, From East Holdings Co., Ltd., controlled by the Company’s major shareholder

3_INTELLECTUAL_PROPERTY

3. INTELLECTUAL PROPERTY	3 Months Ended
	Dec. 31, 2014
Disclosure Text Block [Abstract]
Intangible Assets Disclosure [Text Block]	3.      INTELLECTUAL PROPERTY
	The Company has been granted licenses to use the trademarks CEREBOOST and SVETOL in Company materials and on product packaging. Pursuant to the Trademark License Agreements dated October 11, 2013, the agreement may be terminated by either party, without cause, upon 30 days written notice. Additionally, if the Company fails to purchase the annual minimum amount (500 kg) of product from the licensor for any 12 month period, the licensor may terminate the Company’s license upon 15 days written notice.

4_COMMON_STOCK

4. COMMON STOCK	3 Months Ended
	Dec. 31, 2014
Stockholders' Equity Note [Abstract]
Stockholders' Equity Note Disclosure [Text Block]	4.         COMMON STOCK
	During November 2014, the Company resold 130,000 shares of treasury stock at $0.30 per share, for an aggregate purchase price of $39,000.
	During December 2014, the Company resold 450,000 shares of treasury stock at $0.30 per share, for an aggregate purchase price of $135,000.
	During December 2014, the Company sold 20,000 shares of common stock at $0.66 per share, for an aggregate purchase price of $13,200.

5_STOCK_OPTIONS

5. STOCK OPTIONS	3 Months Ended
	Dec. 31, 2014
Table Text Block Supplement [Abstract]
Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions [Table Text Block]	5.    STOCK OPTIONS
	During October  2013  the  Company  granted  3,471,665  options  to  employee.  The  right  to  exercise  these  options  shall  vest  and  become  25%  exercisable  on  the  first  anniversary  of  when  granted,  with  the  exception  that  100%  of  options  issued  to  one  employee  vested  immediately.  The  remaining  options  shall  vest  and  become  exercisable  ratably  over  the  next  36  months,  with  the  exception  that  options  issued  to  2  employees  shall  vest  and  become  exercisable  over  18  months  and  option  issued  to  one  employee  shall vest  and  become  exercisable  as  of  the  effective  date  of  the  Option  Agreement.  The  exercise  price  is  $0.48  per  share  and  will  expire  ten  years  from  the  grant  date,  unless  terminated  earlier  as  provided  by  the  Option  Agreements.
	The fair  value  of  each  option  award  was  estimated  on  the  date  of  grant  using  the  Black-Scholes  option  valuation  model  using  the  assumptions  noted  as  follows: expected  volatility  was  based  on  historical  trading  in  the  company's  stock.  The  expected  term  of  options  granted  was  determined  using  the  simplified  method  under  SAB  107  and  represents  one-half  the  exercise  period.  The  risk-free  rate  is  calculated  using  the  U.S.  Treasury  yield  curve,  and  is  based on  the  expected  term  of  the  option.  The  Company  has  estimated  there  will  be  no  forfeitures.
	The Black-Scholes  option  pricing  model  was  used  with  the  following  weighted  average  assumptions  for  options  granted  during  the  three  months  ended December 31,  2014:
	Risk-free interest  rate  1%  -  2%  Expected  option  life  5-6 years Expected  volatility  300%
	Expected dividend  yield  0.0%
	During the three months ended December 31, 2014, 2,978,124 options are exercisable and the Company recognized $17,992 of stock options expenses. Unamortized option expense as of December 31, 2014 for all options outstanding amounted to approximately $23,343.

6_STOCK_WARRANTS

6. STOCK WARRANTS	3 Months Ended
	Dec. 31, 2014
Derivative Instruments and Hedging Activities Disclosure [Abstract]
Derivative Instruments and Hedging Activities Disclosure [Text Block]	6.    STOCK WARRANTS
	During April, 2014, the Company granted 100,000 warrants to advisors.  The right to exercise these warrants shall vest in equal eight quarterly installments over the twenty-four (24) months following the date their vesting begins, subject to their continued engagement as a service provider though each such date. The  exercise  price  equal to the current fair market value per  share on the date of grant and  will  expire  ten  years  from  the  grant  date,  unless  terminated  earlier  as  provided  by  the  Warrant Agreements.
	The Black-Scholes  warrant  pricing  model  was  used  with  the  following  weighted  average  assumptions  for  options  granted  during  the  three  months  ended  December 31,  2014:
	Risk-free interest  rate  2.53%  Expected  life  10 years
	Expected volatility  300%
	Expected dividend  yield  0.0%
	During the three months ended December 31, 2014, 37,500 warrants are exercisable and the Company recognized $9,134 of  warrant expenses.

7_SUBSEQUENT_EVENTS

7. SUBSEQUENT EVENTS	3 Months Ended
	Dec. 31, 2014
Subsequent Events [Abstract]
Subsequent Events [Text Block]	7.    SUBSEQUENT EVENTS
	During January 2015, the Company resold 140,000 shares of treasury stock at $0.30 per share, for an aggregate purchase price of $42,000.
	During January 2015, the Company cancelled 1,160,000 shares of common stock.

Accounting_Policies_by_Policy_

Accounting Policies, by Policy (Policies)	3 Months Ended
	Dec. 31, 2014
Accounting Policies [Abstract]
Fair Value of Financial Instruments, Policy [Policy Text Block]	The accompanying  unaudited  interim  financial  statements  of  Nuzee,  Inc.  have  been  prepared  in  accordance  with  accounting  principles  generally  accepted  in  the  United  States  of  America  and  rules  of  the  Securities  and  Exchange  Commission,  and  should  be  read  in  conjunction  with  the  audited  financial  statements  and  notes  thereto  contained  in  the  Company’s  annual  report  on  Form  10-K  for  the  initial  period  ended  September  30,  2014  as  filed  with  the  SEC.  In  the  opinion  of  management,  all  adjustments,  consisting  of  normal  recurring  adjustments,  necessary  for  a  fair  presentation  of  financial  position  and  the  results  of  operations  for  the  interim  periods  presented  have  been  reflected  herein.  The  results  of  operations  for  interim  periods  are  not  necessarily  indicative  of  the  results  to  be  expected  for  the  full  year.  Notes  to  the  consolidated  financial  statements  which  would  substantially  duplicate  the  disclosure  contained  in  the  audited  financial  statements  as  reported  in  the  annual  report  on  Form  10-K  have  been  omitted
Going Concern Note	The accompanying financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America, which contemplates continuation of the Company as a going concern. The Company has had recurring losses, large accumulated deficits, is dependent on the shareholder to provide additional funding for operating expenses and has no recurring revenues. These items raise substantial doubt about the Company’s ability to continue as a going concern

2_RELATED_PARTY_TRANSACTIONS_D

2. RELATED PARTY TRANSACTIONS (Details) (USD $)	Nov. 30, 2014
Related Party Transactions [Abstract]
Due to Related Parties	$9,000

4_COMMON_STOCK_Details

4. COMMON STOCK (Details) (USD $)	0 Months Ended		1 Months Ended
	Dec. 31, 2014	Dec. 15, 2014	Nov. 30, 2014	Jan. 31, 2015
4. COMMON STOCK (Details) [Line Items]
Stock Issued During Period, Shares, New Issues	20,000
Shares Issued, Price Per Share	$0.66			$0.30
Proceeds from Issuance or Sale of Equity	$13,200	$135,000	$39,000
Development Stage Entities, Stock Issued, Shares, Issued for Cash		450,000
IssuedAt0.22PerShare
4. COMMON STOCK (Details) [Line Items]
Stock Issued During Period, Shares, New Issues			130,000
IssuedAt0.48PerShare
4. COMMON STOCK (Details) [Line Items]
Shares Issued, Price Per Share			$0.30
IssuedAt0.12PerShare
4. COMMON STOCK (Details) [Line Items]
Shares Issued, Price Per Share		$0.30

5_STOCK_OPTIONS_Details

5. STOCK OPTIONS (Details) (USD $)	1 Months Ended	3 Months Ended
	Oct. 31, 2013	Dec. 31, 2014
Table Text Block Supplement [Abstract]
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Net of Forfeitures	3,471,665
PercentageOfExercisableOptions	25.00%
Investment Options, Exercise Price (in Dollars per share)	$0.48
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period		2,978,124
Stock Issued During Period, Value, Stock Options Exercised (in Dollars)		$17,992

6_STOCK_WARRANTS_Details

6. STOCK WARRANTS (Details)	3 Months Ended	120 Months Ended	127 Months Ended	135 Months Ended
	Dec. 31, 2014	Apr. 30, 2024	Apr. 30, 2024	Dec. 31, 2024	Apr. 29, 2014
Derivative Instruments and Hedging Activities Disclosure [Abstract]
Class of Warrant or Right, Outstanding (in Shares)		3	3		100,000
Fair Value Assumptions, Risk Free Interest Rate	2.53%
Fair Value Assumptions, Expected Term		10 years
Fair Value Assumptions, Expected Volatility Rate			300.00%
Fair Value Assumptions, Expected Dividend Rate			0.00%
Class of Warrant or Right, Expense or Revenue Recognized				37,500

7_SUBSEQUENT_EVENTS_Details

7. SUBSEQUENT EVENTS (Details) (USD $)	Jan. 31, 2015	Dec. 31, 2014	Sep. 30, 2014
Subsequent Events [Abstract]
Common Stock, Shares, Issued	140,000	30,619,719	30,599,719
Shares Issued, Price Per Share (in Dollars per share)	$0.30	$0.66
Common Stock, Value, Issued (in Dollars)	$42,000	$306	$306
CancellationOfCommonStock	1,160,000