Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2014 |
Accounting Policies [Abstract] | ' |
Principles of Consolidation | ' |
Principles of Consolidation |
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Global Equity International Inc. is the parent company of its 100% subsidiary Global Equity Partners Plc. All significant inter-company accounts and transactions have been eliminated in consolidation. |
Use of Estimates | ' |
Use of Estimates |
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The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. |
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Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the financial statements, which management considered in formulating its estimate could change in the near term due to one or more future non confirming events. Accordingly, the actual results could differ from those estimates. |
Risks and Uncertainties | ' |
Risks and Uncertainties |
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The Company's operations are subject to significant risk and uncertainties including financial, operational, competition and potential risk of business failure. The risk of social and governmental factors is also a concern since the Company is headquartered in Dubai. |
Cash | ' |
Cash |
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The Company considers all highly liquid investments with an original maturity of three months or less to be cash equivalents. At March 31, 2014 and at December 31, 2013 respectively, the Company had no cash equivalents. |
Accounts Receivable and Allowance for Doubtful Accounts | ' |
Accounts Receivable and Allowance for Doubtful Accounts |
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The Company recognizes accounts receivable in connection with the services provided. The Company recognizes an allowance for doubtful accounts based on an analysis of current receivables aging and expected future write-offs, as well as an assessment of specific identifiable customer accounts considered at risk or uncollectible. At the quarter ended March 31, 2014, the Company had no bad debt. |
Marketable Securities | ' |
Marketable Securities |
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(A) Classification of Securities |
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At the time of the acquisition, a security is designated as held-to-maturity, available-for-sale or trading, which depends on the ability and intent to hold such security to maturity. Securities classified as trading and available-for-sale are reported at fair value, while securities classified as held-to-maturity are reported at amortized cost. The Company recorded unrealized loss on marketable securities of $0 and $0 as at March 31, 2014 and December 31, 2013. |
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Cost Method Investment |
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At March 31, 2013, the Company had investment in securities of two different Companies, having a cost of $163,000 that is treated as a cost method investment. The value of the cost method investment pertains to the receipt of 9.2% of the common stock in a private company in which the best evidence of value was the services rendered and a further 9.86% of the common stock in another private company in which the best evidence of value was the services rendered. |
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At June 30, 2013, there were identifiable events or changes in circumstances that had a significant adverse effect on the value of one of the investments hence the Company impaired $160,000 of the investments. |
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Also at June 30, 2013, the Company received 2,000,000 shares from a private company and client having a cost of $2,000 that is treated as a cost method investment. The value of the cost method investment pertains to the receipt of 8.55% of the common stock in a private company in which the best evidence of value was the services rendered. |
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Equity investment in companies is accounted for under the cost method as the equity investments do not have readily determinable fair values. As per ASC codification 320 “Certain Investments in Debt and Equity Securities”, non-marketable equity securities that do not have a readily determinable fair value are not required to be accounted for under the equity method and are typically carried at cost. |
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(B) Other than Temporary Impairment |
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The Company reviews its equity investment portfolio for any unrealized losses that would be deemed other-than-temporary and require the recognition of an impairment loss in income. If the cost of an investment exceeds its fair value, the Company evaluates, among other factors, general market conditions, the duration and extent to which the fair value is less than cost, and the Company’s intent and ability to hold the investments. Management also considers the type of security, related-industry and sector performance, as well as published investment ratings and analyst reports, to evaluate its portfolio. Once a decline in fair value is determined to be other than temporary, an impairment charge is recorded and a new cost basis in the investment is established. If market, industry, and/or investee conditions deteriorate, the Company may incur future impairments. The Company did not carry out any impairments during the quarter ended March 31, 2014. |
Beneficial Conversion Feature | ' |
Beneficial Conversion Feature |
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For conventional convertible debt where the rate of conversion is below market value, the Company records a "beneficial conversion feature" ("BCF") and related debt discount. |
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When the Company records a BCF, the relative fair value of the BCF would be recorded as a debt discount against the face amount of the respective debt instrument. The discount would be amortized to interest expense over the life of the debt. |
Debt Issue Costs and Debt Discount | ' |
Debt issue costs and debt discount |
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The Company may pay debt issue costs, and record debt discounts in connection with raising funds through the issuance of convertible debt. These costs are amortized over the life of the debt to interest expense. If a conversion of the underlying debt occurs, a proportionate share of the unamortized amounts is immediately expensed. |
Original Issue Discount | ' |
Original issue discount |
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For certain convertible debt issued, the Company provides the debt holder with an original issue discount. The original issue discount is recorded to debt discount, reducing the face amount of the note and is amortized to interest expense over the life of the debt. |
Fixed Assets | ' |
Fixed Assets |
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Fixed Assets are to be stated at cost of acquisition less accumulated depreciation. Depreciation is provided based on estimated useful lives of the assets. Cost of improvements that substantially extend the useful lives of assets can be capitalized. Repairs and maintenance expenses are to be charged to expense when incurred. In case of sale or disposal of an asset, the cost and related accumulated depreciation are removed from the consolidated financial statement. |
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| | 31-Mar-14 | | | 31-Mar-13 | |
Office equipment | | $ | 9,316 | | | $ | 6,579 | |
Accumulated depreciation | | $ | (1,970 | ) | | $ | (446 | ) |
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Net fixed assets | | $ | 7,346 | | | $ | 6,133 | |
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During the three months ended March 31, 2014 and March 31, 2013, the Company expensed $471 and $329 respectively for depreciation. |
Revenue Recognition | ' |
Revenue Recognition |
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We recognize revenue when all of the following conditions are satisfied: (1) there is persuasive evidence of an arrangement; (2) the product or service has been provided to the customer; (3) the amount of fees to be paid by the customer is fixed or determinable; and (4) the collection of our fees is probable. |
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The Company’s services do not include a provision for cancellation, termination, or refunds. |
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For the quarters ended March 31, 2014 and March 31, 2013 the Company received cash only as consideration for services rendered. |
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At March 31, 2014 and March 31, 2013, the Company had the following concentrations of accounts receivables with customers: |
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Customer | | 31-Mar-14 | | | 31-Mar-13 | |
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ACI | | | 100 | % | | | 3 | % |
| | | 100 | % | | | 3 | % |
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For the three months ended March 31, 2014 and March 31, 2013, the Company had the following concentrations of revenues with customers: |
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Customer | | 31-Mar-14 | | | 31-Mar-13 | |
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YMD | | | 16 | % | | | 0 | % |
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MHB | | | 16 | % | | | 0 | % |
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IOA | | | 16 | % | | | 0 | % |
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SAC | | | 30 | % | | | 0 | % |
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DSI | | | 20 | % | | | 0 | % |
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ACI | | | 0 | % | | | 100 | % |
| | | 100 | % | | | 100 | % |
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The company currently holds the following equity securities in private and also reporting companies: |
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Company | | No. Shares | | | Status | | |
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M1 Lux AG | | | 2,000,000 | | | Private Company | | |
Monkey Rock Group Inc. | | | 1,500,000 | | | Reporting Company – OTC | | |
Voz Mobile Cloud Limited | | | 3,200,000 | | | Private Company | | |
Arrow Cars International Inc. | | | 3,000,000 | | | Reporting Company – OTC | | |
Direct Security Integration Inc. | | | 2,000,000 | | | Private Company | | |
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| | | 11,700,000 | | | | | |
Deferred Revenue | ' |
Deferred Revenue |
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Deferred revenue represents fees that have been received by the Company for requested services that have not been substantially completed. During the year ended December 31, 2013 the Company received $307,000 from two clients for service to be rendered during the year 2013 and 2014. At March 31, 2014, the Company recognized $137,250 of this deferred revenue as revenue; leaving a deferred revenue balance of $169,750. |
Share-based Payments | ' |
Share-based payments |
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The Company recognizes all forms of share-based payments, including stock option grants, warrants and restricted stock grants at their fair value on the grant date, which is based on the estimated number of awards that are ultimately expected to vest. |
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Share based payments, excluding restricted stock, are valued using a Black-Scholes pricing model. Share based payment awards issued to non-employees for services rendered are recorded at either the fair value of the services rendered or the fair value of the share-based payment, whichever is more readily determinable. The grants are amortized on a straight-line basis over the requisite service periods, which is generally the vesting period. |
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When computing fair value, the Company considered the following variables: |
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| ● | The risk-free interest rate assumption is based on the U.S. Treasury yield for a period consistent with the expected term of the share based payment in effect at the time of the grant. | | | | | | |
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| ● | The expected term was developed by management estimate. | | | | | | |
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| ● | The Company has not paid any dividends on common stock since inception and does not anticipate paying dividends on its common stock in the near future. | | | | | | |
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| ● | The expected volatility is based on management estimates regarding private company stock, where future trading of stock in a public market is expected to be highly volatile. | | | | | | |
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| ● | The forfeiture rate is based on historical experience. | | | | | | |
Income Taxes | ' |
Income Taxes |
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Income taxes are accounted for under the asset and liability method. Deferred income tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases, and operating loss carry-forwards. Deferred income tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred income tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance is provided to reduce the carrying amount of deferred income tax assets if it is considered more likely than not that some portion, or all, of the deferred income tax assets will not be realized. |
Earnings Per Share | ' |
Earnings per Share |
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Basic earnings (loss) per share are computed by dividing net income (loss) by weighted average number of shares of common stock outstanding during each period. Diluted earnings (loss) per share is computed by dividing net income (loss) by the weighted average number of shares of common stock, common stock equivalents and potentially dilutive securities outstanding during the period. |
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The Company has no common stock equivalents, which, if exercisable, would be dilutive. A separate computation of diluted earnings (loss) per share is not presented. |
Fair Value of Financial Assets and Liabilities | ' |
Fair Value of Financial Assets and Liabilities |
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The carrying amounts reflected in the balance sheets for cash, accounts payable and accrued expenses approximate the respective fair values due to the short maturities of these items. The Company does not hold any investments that are available-for-sale. |
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As required by the Fair Value Measurements and Disclosures Topic of the FASB ASC, fair value is measured based on a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value as follows: (Level 1) observable inputs such as quoted prices in active markets; (Level 2) inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and (Level 3) unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions. |
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The three levels of the fair value hierarchy are described below: |
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Level 1: Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities; |
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Level 2: Quoted prices in markets that are not active, or inputs that are observable, either directly or indirectly, for substantially the full term of the asset or liability; |
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Level 3: Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (supported by little or no market activity). |
Loans to Third Parties | ' |
Loans to Third Parties |
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On March 22, 2013 the Company granted a loan to Dreamscapes Properties International Inc. The principal amount lent was $6,000, the agreed interest rate was 5% per annum and finally, the loan would have to be repaid no later than one year from the date that the loan was granted. This loan is currently in default, the Company plans to speak to Dreamscapes Properties International Inc. with a review to discuss a payment plan over the next 6 months. |
Recent Accounting Pronouncements | ' |
Recent Accounting Pronouncements |
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There are no new accounting pronouncements that have any impact on the Company’s financial statements. |