Pazoo (PZOO) 10-K/A 27 Apr 17 2016 FY Annual report (amended) Financial data

Document and Entity Information

Document and Entity Information - USD ($)	12 Months Ended
	Dec. 31, 2016	Jun. 30, 2016
Document and Entity Information:
Entity Registrant Name	Pazoo, Inc.
Document Type	10-K
Document Period End Date	Dec. 31, 2016
Trading Symbol	pzoo
Amendment Flag	true
Amendment Description	1
Entity Central Index Key	1,533,427
Current Fiscal Year End Date	--12-31
Entity Common Stock, Shares Outstanding		229,624,894
Entity Public Float		$ 1,077,657
Entity Filer Category	Smaller Reporting Company
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Entity Well-known Seasoned Issuer	No
Document Fiscal Year Focus	2,016
Document Fiscal Period Focus	FY

CONSOLIDATED BALANCE SHEETS

CONSOLIDATED BALANCE SHEETS - USD ($)	Dec. 31, 2016		Dec. 31, 2015
Current assets:
Cash	$ 88,909		$ 16,819
Prepaid expenses	5,536		5,448
Total current assets	94,445		22,267
Other assets
Fixed assets, net	613,332		749,841
Intangible assets, net			1,590,935
Total other assets	613,332		2,340,776
Total assets	707,777		2,363,043
Current liabilities:
Lines of credit	21,039		19,500
Accounts payable and accrued liabilities	608,332		406,176
Loans payable	615,801		203,000
Interest payable	1,452,102		172,709
Convertible debt	983,621	[1]	809,644	[2]
Contingent consideration liabilities	713,581		718,581
Derivative liabilities	2,925,627		1,756,435
Capital lease liability current	373,930		304,516
Total current liabilities	7,694,033		4,390,561
Long-term liabilities:
Long-term portion of convertible debt	1,401,828	[3]	198,464	[4]
Capital lease liability - noncurrent	136,672		242,771
Total long-term liabilities	1,538,500		441,235
Total liabilities	9,232,533		4,831,796
Commitments
Stockholders' deficit:
Common stock	2,284,408		14,865
Additional paid-in capital	9,880,371		9,410,382
Accumulated deficit	(20,694,148)		(11,898,674)
Total stockholders' deficit	(8,524,756)		(2,468,753)
Total liabilities and stockholders' deficit	707,777		2,363,043
Series A Preferred Stock
Stockholders' deficit:
Preferred Stock, Value	230		861
Series B Preferred Stock
Stockholders' deficit:
Preferred Stock, Value	1,762		1,762
Series C Preferred Stock
Stockholders' deficit:
Preferred Stock, Value	$ 2,621		$ 2,051
[1]	Net of unamortized discounts of $195,827.
[2]	Net of unamortized discounts of $533,391.
[3]	Net of unamortized discounts of $110,672.
[4]	Net of unamortized discounts of $794,036.

Statement of Financial Position

Statement of Financial Position - Parenthetical - $ / shares	Dec. 31, 2016	Dec. 31, 2015
Common Stock, Par Value	$ 0.001	$ 0.001
Common Stock, Shares Authorized	2,950,000,000	2,950,000,000
Common Stock, Shares Issued	2,284,407,419	14,865,053
Common Stock, Shares Outstanding	2,284,407,419	14,865,053
Warrants Issued	7,000,000	2,400,000
Warrants Outstanding	7,000,000	2,400,000
Preferred Stock Series A
Preferred Stock, Par Value	$ 0.001	$ 0.001
Preferred Stock, Shares Authorized	10,000,000	10,000,000
Preferred Stock, Shares Issued	230,401	860,669
Preferred Stock, Shares Outstanding	230,401	860,669
Preferred Stock Series B
Preferred Stock, Par Value	$ 0.001	$ 0.001
Preferred Stock, Shares Authorized	5,000,000	5,000,000
Preferred Stock, Shares Issued	1,762,500	1,762,500
Preferred Stock, Shares Outstanding	1,762,500	1,762,500
Preferred Stock Series C
Preferred Stock, Par Value	$ 0.001	$ 0.001
Preferred Stock, Shares Authorized	10,000,000	10,000,000
Preferred Stock, Shares Issued	2,621,375	2,051,000
Preferred Stock, Shares Outstanding	2,621,375	2,051,000
Preferred Stock Series D
Preferred Stock, Par Value	$ 0.001	$ 0.001
Preferred Stock, Shares Authorized	12,500,000	12,500,000
Preferred Stock, Shares Issued	0	0
Preferred Stock, Shares Outstanding	0	0
Preferred Stock Series E
Preferred Stock, Par Value	$ 0.001	$ 0.001
Preferred Stock, Shares Authorized	12,500,000	12,500,000
Preferred Stock, Shares Issued	0	0
Preferred Stock, Shares Outstanding	0	0

CONSOLIDATED STATEMENTS OF OPER

CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($)	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015
Revenues:
Management fees - related party	$ 30,515
Advertising Sales		$ 26,662
Total revenues	30,515	26,662
Operating expenses:
Selling, general and administrative expenses	2,269,494	3,143,262
Professional fees	664,022	823,488
Loss on impairment of license	1,540,207
Website setup	9,274	135,154
Total operating expenses	4,482,997	4,101,904
Loss from operations	(4,452,482)	(4,075,242)
Other income/(expenses):
Gain/(loss) on derivative liabilities	(3,827,703)	(898,759)
Gain on debt extinguishment	2,430,259	3,412,265
Gain on change in fair value of contingent consideration	5,000	10,000
Loss on impairment of equity method investment		(839,919)
Interest expense	(2,950,548)	(2,087,070)
Total other income/(expenses)	(4,342,992)	(403,483)
Net loss	(8,795,474)	(4,478,725)
Series A preferred stock dividends	(76)	(39,743)
Net loss attributable to common stockholders	$ (8,795,550)	$ (4,518,468)
Net loss per common share - basic and diluted	$ (0.01)	$ (0.69)
Weighted average common shares outstanding - basic and diluted	669,625,441	6,553,747

CONSOLIDATED STATEMENTS OF CASH

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($)		12 Months Ended
		Dec. 31, 2016	Dec. 31, 2015
Cash flows from operating activities:
Net loss		$ (8,795,474)	$ (4,478,725)
Adjustments to reconcile net loss to net cash used in operating activities:
Amortization of debt discounts		1,420,061	1,971,984
Depreciation		136,509	140,047
Amortization		50,728	62,337
Gain on change in fair value of contingent consideration		(5,000)	(10,000)
Stock-based compensation		79,900	1,297,481
Gain/(loss) on derivative liabilities		3,827,703	898,759
Gain on debt extinguishment		(2,430,259)	(3,412,265)
(Gain)/loss on impairment of intangibles		1,540,207
Loss on settlement		1,146,231
Loss on impairment of equity method investment			839,919
Changes in operating assets and liabilities:
Accounts receivable (increase/decrease)			87,949
Inventory (increase/decrease)			2,668
Prepaid expenses and other current assets (increase/decrease)		(1)	733
Accounts payable, accrued liabilities and interest payable (increase/decrease)		2,101,310	670,803
Net cash used in operating activities		(928,085)	(1,928,310)
Cash flows from investing activities:
Cash paid for purchase of licenses			(307,500)
Acquisition of fixed assets			(4,052)
Equity investment in equity method investee			(778,639)
Net cash used in investing activities			(1,090,191)
Cash flows from financing activities:
Proceeds from convertible note		673,460	1,443,287
Stock subscription receivable			18,253
Repayments on capital leases		(36,685)	(67,737)
Repayments on convertible notes and loans		(175,239)	(413,000)
Proceeds from loans payable		447,100	200,000
Proceeds from issuing common stock			48,380
Proceeds from sale of preferred stock and warrants	[1]	0	580,000
Proceeds from exercise of preferred warrants	[1]	0	25,000
Proceeds from sale of preferred stock	[2]	90,000	448,000
Lines of credit (increase/decrease)		1,539	19,500
Net cash provided by financing activities		1,000,175	2,301,683
Net (decrease) in cash and cash equivalents		72,090	(716,818)
Cash and cash equivalents beginning of period		16,819	733,637
Cash and cash equivalents end of period		88,909	16,819
Noncash Investing and Financing Activities
Fixed assets acquired through capital lease			615,024
Preferred shares issued for acquisition	[3]	0	1,000,000
Contingent consideration for acquisition	[3]	0	1,228,581
Debt discount due to derivative liabilities		1,233,098	2,296,385
Preferred shares issued for conversion of debt and interest		30,652
Common shares issued for conversion of debt and interest		1,042,688	1,303,908
Common shares issued with debt			$ 93,087
Common shares issued for accrued liability		$ 350,000
[1]	Series A.
[2]	Series C.
[3]	Of MA & Associates.

STATEMENTS OF STOCKHOLDERS' DEF

STATEMENTS OF STOCKHOLDERS' DEFICIT - USD ($)	Total	Common Stock	Series A Preferred Stock	Series B Preferred Stock	Series C Preferred Stock	Additional Paid-In Capital	Accumulated Deficit
Balance, Value at Dec. 31, 2014	$ (2,785,884)	$ 1,930	$ 1,036	$ 1,187		$ 4,629,912	$ (7,419,949)
Balance, Shares at Dec. 31, 2014		1,930,304	1,036,394	1,187,500
Common shares issued for services, Value	135,981	$ 522				135,459
Common shares issued for services, Shares		522,208
Conversion of preferred stock to common stock, Value		$ 3,315	$ (3,115)		$ (200)
Conversion of preferred stock to common stock, Shares		3,315,000	(3,115,000)		(200,000)
Preferred Series A stock and warrants issued for cash, Value	580,000		$ 2,542			577,458
Preferred Series A stock and warrants issued for cash, Shares			2,542,132
Preferred shares issued for services, Value	1,161,500		$ 50	$ 575	$ 803	1,160,072
Preferred shares issued for services, Shares			50,000	575,000	803,000
Preferred shares issued for acquisitions, Value	1,000,000				$ 1,000	999,000
Preferred shares issued for acquisitions, Shares					1,000,000
Preferred shares issued for cash, Value	448,000				$ 448	447,552
Preferred shares issued for cash, Shares					448,000
Common shares issued for cash, Value	48,380	$ 55				48,325
Common shares issued for cash, Shares		54,601
Issuance of preferred stock for warrant exercises, Value	$ 25,000		$ 348			$ 24,652
Issuance of preferred stock for warrant exercises, Shares			347,143
Common shares issued for conversion of debt, Value	1,303,908	8,921				1,294,987
Common shares issued for conversion of debt, Shares		8,921,288
Common shares issued with debt, Value	$ 93,087	$ 122				$ 92,965
Common shares issued with debt, Shares		121,652
Profit (loss)	(4,478,725)						(4,478,725)
Balance, Value at Dec. 31, 2015	$ (2,468,753)	$ 14,865	$ 861	$ 1,762	$ 2,051	9,410,382	(11,898,674)
Balance, Shares at Dec. 31, 2015	14,865,053	14,865,053	860,669	1,762,500	2,051,000
Common shares issued for services, Value	$ 2,400	$ 60				2,340
Common shares issued for services, Shares		60,000
Conversion of preferred stock to common stock, Value		$ 218,229	$ (692)		$ (1,836)	$ (215,701)
Conversion of preferred stock to common stock, Shares		218,228,526	(691,629)		(1,835,697)
Common shares issued for conversion of debt, Value	1,042,688	2,051,254				(1,008,566)
Common shares issued for conversion of debt, Shares		2,051,253,840
Preferred Series A stock issued for debt conversion, Value	$ 30,652		$ 61			$ 30,591
Preferred Series A stock issued for debt conversion, Shares			61,306
Preferred Series A stock issued for dividends, Shares			55
Preferred Series C issued for services - non cash, Value	77,500				$ 77	77,423
Preferred Series C issued for services - non cash, Shares					77,500
Preferred Series C stock issued for cash, Value	90,000				$ 129	89,871
Preferred Series C stock issued for cash, Shares					128,572
Preferred Series C stock issued to ICPI for settlement, Value	1,496,231				$ 2,200	1,494,031
Preferred Series C stock issued to ICPI for settlement, Shares					2,200,000
Profit (loss)	(8,795,474)						(8,795,474)
Balance, Value at Dec. 31, 2016	$ (8,524,756)	$ 2,284,408	$ 230	$ 1,762	$ 2,621	$ 9,880,371	$ (20,694,148)
Balance, Shares at Dec. 31, 2016	2,284,407,419	2,284,407,419	230,401	1,762,500	2,621,375

Note 1-Description of Business,

Note 1-Description of Business, Basis of Presentation and Summary of Significant Accounting Policies	12 Months Ended
	Dec. 31, 2016
Notes
Note 1-Description of Business, Basis of Presentation and Summary of Significant Accounting Policies	Note 1—DESCRIPTION OF BUSINESS, BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Description of Business The Company entered the pharmaceutical testing laboratory market with their acquisitions of MA & Associates, LLC which will operate pharmaceutical testing laboratories in Nevada, and Harris Lee Holdings, LLC which will operate pharmaceutical testing laboratories within other states, or license testing protocols as independently owned laboratories. These pharmaceutical testing laboratories focus on providing quality control services to the medical cannabis industry. The mission is to protect the public health by providing infrastructure and analytical services to legally-authorized cannabis producers and distributors as well as to regulators. States that have legalized cannabis are developing cannabis health and safety criteria that we will fulfill through their testing laboratories. Harris Lee Holdings, LLC, due to Colorado residency requirements, entered into an advisory agreement with Harris Lee Colorado, LLC, a related party. Harris Lee Holdings, LLC has sub-licensed the testing protocols to Harris Lee Colorado, LLC in exchange for management fees for each test conducted. The Colorado MED approved the transfer of management of an existing laboratory, operating as Steep Hill Colorado, to Harris Lee Colorado, LLC (a related party) and Harris Lee Holdings, LLC has derived management fees from Harris Lee Colorado, LLC in the year ending December 31, 2016. However, because of the failure to transfer the MED license to Harris Lee Colorado, LLC, the Denver laboratory was closed by the end 2016. The Company does not expect to re-commence operations in the near future. Lastly, the Company's wholly owned subsidiary, CK Distribution LLC, provides the marketing and sales agent for the distribution of non-controlled hemp products throughout the USA. Non-controlled hemp products are the items utilized by the industry that support grow facilities, infusion companies and dispensaries. Further, the business consists of pazoo.com, an online, content driven, ad supported health and wellness web site for people and their pets. Additionally, this site has e-commerce functionality which allows pazoo.com to be an online retailer of nutritional foods/supplements, wellness goods, and fitness apparel. Pazoo, Inc. does not have any brick and mortar establishments. Basis of Presentation The accompanying consolidated financial statements include the accounts of the Pazoo, Inc. ("Pazoo" or the "Company") and its wholly-owned subsidiaries MA & Associates, LLC, Harris Lee Holdings LLC, and CK Distribution. These consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States ("GAAP"). All significant inter-company transactions and accounts have been eliminated in consolidation. In March 2016, the Company effected a 1-for-100 reverse stock split of the outstanding common stock (the "Reverse Stock Split") whereby every one hundred (100) shares of outstanding common stock decreased to one (1) share of common stock. Similarly, the number of shares of common stock, par value $0.001 ("Common Stock") into which each outstanding Preferred stock, convertible debt and warrant to purchase common stock is to be exercisable decreased on a 1-for-100 basis and the exercise price of each outstanding preferred stock and warrant to purchase common stock increased proportionately. The impact of this reverse stock split has been retroactively applied to the financial statements and the related notes and all debt terms were also adjusted/effected. In January 2017, the Company filed a Form 14-C in order to effectuate a 1-for-250 reverse stock split of the outstanding common stock (the "Reverse Stock Split") whereby every two hundred and fifty (250 shares of outstanding common stock decreases to one (1) share of common stock. The current Reverse Stock Split is still pending and has not yet gone effective, and is pending FINRA approval. All Preferred shares of stock are not effected by reverse splits or re-capitalizations. Use of Estimates In accordance with GAAP the preparation of these consolidated financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the consolidated financial statements and the reported amount of revenues and expenses during the reporting period. On an ongoing basis, management evaluates its estimates and judgments, including those related to revenue recognition, accrued expenses, financing operations, and contingencies and litigation. Management bases its estimates and judgments on historical experience and on various other factors that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions and conditions. The most significant accounting estimates inherent in the preparation of the Company's financial statements include estimates as to the appropriate carrying value of certain assets and liabilities which are not readily apparent from other sources. These accounting policies are described at relevant sections in the notes to the financial statements. Principles of Consolidation The consolidated financial statements include the accounts of Pazoo and its subsidiaries, which are wholly owned. All significant intercompany transactions and balances have been eliminated in consolidation. Fixed Asset Fixed assets are presented at cost at the date of acquisition. Depreciation and amortization is calculated based on the straight-line method over the estimated useful lives of the depreciable assets, or in the case of leasehold improvements, the shorter of the lease term or the estimated useful life of the asset, a portion of which is allocated to cost of sales. Improvements are capitalized while repairs and maintenance are charged to operations as incurred. Impairment of Long-Lived Assets The Company's intangible assets and fixed assets are reviewed for impairment whenever events or changes in circumstances indicate that the historical-cost carrying value of an asset may no longer be appropriate. The Company assesses recoverability of the asset by comparing the undiscounted future net cash flows expected to result from the asset to its carrying value. If the carrying value exceeds the undiscounted future net cash flows of the asset, an impairment loss is measured and recognized. An impairment loss is measured as the difference between the net book value and the fair value of the long-lived asset. The Company, due to the uncertainties surrounding the license agreement, impaired 100% of the value of the Steep Hill Labs licenses due to the purported unsubstantiated termination of the license agreements in June 2016 between Steep Hill Labs and MA & Associates, LLC and Harris Lee, LLC respectively. The Company strongly believes that any attempted termination of the licenses on the part of Steep Hill Labs was ineffective for many reasons, including, without limitation, Steep Hill's failure to provide key deliverables including technology, scientific know-how and lab guidance. On July 6, 2016, the Company contested the improper attempted termination of the licenses which was based on no identifiable contractual justification, and to which Steep Hill has not formally responded. To the contrary, as of the date of this Report, Steep Hill Labs continues to list the Company as one of its "partners" and continues to display the Company's Las Vegas facility as a Steep Hill location. If Steep Hill Labs takes any further action to effectuate the ineffective termination of the licenses, this matter will be litigated under the terms and conditions of the respective license agreements, which management will vigorously defend. Fair Value of Financial Instruments The Company's financial instruments consist principally of cash and cash equivalents and accounts payable. The Company believes that the recorded values of all of its other financial instruments approximate their fair values because of their nature and respective maturity dates or durations. Assets and liabilities measured at fair value are categorized based on whether or not the inputs are observable in the market and the degree that the inputs are observable. The categorization of financial instruments within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The hierarchy is prioritized into three levels (with Level 3 being the lowest) defined as follows: Level 1: Level 2: Level 3: The following table sets forth by level within the fair value hierarchy the Company's financial assets and liabilities that were accounted for at fair value as December 31, 2016 and 2015. Recurring Fair Value Measurements Level 1 Level 2 Level 3 Total LIABILITIES: Derivative liability – December 31, 2016 $ - $ - $ 2,925,627 $ 2,925,627 Derivative liability – December 31, 2015 $ - $ - $ 1,756,435 $ 1,756,435 The Company has certain convertible notes outstanding at December 31, 2016 and 2015 with variable conversion rates that qualify as derivatives that need to be separately accounted for in accordance with FASB ASC 815, "Derivatives and Hedging" Cash and Cash Equivalents We classify all highly liquid instruments with an original maturity of three months or less at the time of purchase as cash equivalents. Stock Based Compensation ASC 718 "Compensation - Stock Compensation" prescribes accounting and reporting standards for all stock-based payments awarded to employees, including employee stock options, restricted stock, employee stock purchase plans and stock appreciation rights, which may be classified as either equity or liabilities. The Company determines if a present obligation to settle the share-based payment transaction in cash or other assets exists. A present obligation to settle in cash or other assets exists if: (a) the option to settle by issuing equity instruments lacks commercial substance or (b) the present obligation is implied because of an entity's past practices or stated policies. If a present obligation exists, the transaction is recognized as a liability; otherwise, the transaction is recognized as equity. The Company accounts for stock-based compensation issued to non-employees and consultants in accordance with the provisions of ASC 505-50 "Equity-Based Payments to Non-Employees." Measurement of share-based payment transactions with non-employees is based on the fair value of whichever is more reliably measurable: (a) the goods or services received; or (b) the equity instruments issued. The fair value of the share-based payment transaction is determined at the earlier of performance commitment date, the performance completion date, or the contract date. Revenue Recognition Revenues are recognized when evidence of an agreement exists, the price is fixed or determinable, collectability is reasonably assured and goods have been delivered or services performed. The Company is paid revenue from various advertising, cannabis testing, management fees, and sales and distribution of non-controlled hemp products. During the year ended 2016, the Company's only recognized revenues were derived from management fees. Income Taxes Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. These assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which the temporary differences are expected to reverse. We have net operating loss carryforwards available to reduce future taxable income. Future tax benefits for these net operating loss carryforwards are recognized to the extent that realization of these benefits is considered more likely than not. To the extent that we will not realize a future tax benefit, a valuation allowance is established. Basic and Diluted Net Loss Per Common Share Basic net loss per common share is computed by dividing net loss applicable to common stockholders by the weighted average number of common shares outstanding during the period. Diluted net loss per common share reflects, in addition to the weighted average number of common shares, the potential dilution if shares of convertible preferred stock and debt were converted into shares of common stock and a corresponding accrued 5% dividend, unless the effects of such exercises and conversions would have been anti-dilutive. Potentially Dilutive Securities December 31, 2016 December 31, 2015 Common stock warrants - 3,355 Convertible notes 32,355,840,300 92,239,381 Preferred series A shares & warrants 23,040,100 86,066,900 Preferred series B 352,000,000 352,000,000 Preferred series C 262,137,500 205,100,000 32,993,017,900 735,409,636 Advertising Expenses Costs associated with advertising are charged to expense as incurred. Recent Accounting Pronouncements February 2016, the Financial Accounting Standards Board ("FASB") issued new guidance related to how an entity should recognize lease assets and lease liabilities. The guidance specifies that an entity who is a lessee under lease agreements should recognize lease assets and lease liabilities for those leases classified as operating leases under previous FASB guidance. Accounting for leases by lessors is largely unchanged under the new guidance. The guidance is effective for us beginning in the first quarter of 2019. Early adoption is permitted. In transition, lessees and lessors are required to recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach. The Company is evaluating the impact of adopting this guidance on our consolidated financial condition, results of operations and cash flows. In March 2016, the FASB issued new guidance which involves several aspects of the accounting for share-based payment transactions including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. Under the new standard, income tax benefits and deficiencies are to be recognized as income tax expense or benefit in the income statement and the tax effects of exercised or vested awards should be treated as discrete items in the reporting period in which they occur. An entity should also recognize excess tax benefits regardless of whether the benefit reduces taxes payable in the current period. Excess tax benefits should be classified along with other income tax cash flows as an operating activity. In regards to forfeitures, the entity may make an entity-wide accounting policy election to either estimate the number of awards that are expected to vest or account for forfeitures when they occur. This ASU is effective for fiscal years beginning after December 15, 2016 including interim periods within that reporting period, however early adoption is permitted. The Company is currently evaluating the guidance to determine the Company's adoption method and the effect it will have on the Company's Consolidated Financial Statements. In January 2016, the FASB issued ASU 2016-01, Financial Instruments-Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities. The amendments in ASU 2016-01, among other things, requires equity investments (except those accounted for under the equity method of accounting, or those that result in consolidation of the investee) to be measured at fair value with changes in fair value recognized in net income; Requires separate presentation of financial assets and financial liabilities by measurement category and form of financial asset (i.e., securities or loans and receivables); Eliminate the requirement to disclose the fair value of financial instruments measured at amortized cost for entities that are not public business entities. The amendments in this ASU are effective for non-public companies for fiscal years beginning after December 15, 2018, and interim periods within fiscal years beginning December 15, 2019. Early adoption of the amendments in the ASU is permitted as early as the fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. The adoption of this standard is not expected to have a material effect on the consolidated financial position and results of operations and statements of cash flows. In August 2014, the FASB issued ASU No. 2014-15 —Presentation of Financial Statements—Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity's Ability to Continue as a Going Concern. The ASU requires management to evaluate whether there are conditions and events that raise substantial doubt about the entity's ability to continue as a going concern within one year after the financial statements are issued and if management's plans will alleviate that doubt. Management will be required to make this evaluation for both annual and interim reporting periods. The Company adopted this guidance for the fiscal year ended December 31, 2016. This adoption did not have a material impact on the Company's consolidated financial statements. In September 2015, the FASB issued Accounting Standards Update (ASU) 2015-16—Business Combinations, as part of its initiative to reduce complexity in accounting standards (the Simplification Initiative). The amendment eliminates the requirement to retrospectively apply adjustments made to provisional amounts recognized in a business combination. The amendment is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2016. Early adoption is permitted. The Company expects to adopt this guidance for the year ended December 31, 2016. The Company does not expect this guidance to have a material effect on its consolidated financial statements. On May 28, 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers, which requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. The ASU will replace most existing revenue recognition guidance in U.S. GAAP when it becomes effective. In August 2015, the FASB issued ASU No. 2015-14, Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date, which delayed the effective date of the new standard from January 1, 2017 to January 1, 2018. The FASB also agreed to allow entities to choose to adopt the standard as of the original effective date. This ASU permits the use of either the retrospective or cumulative effect transition method. The Company is evaluating the effect that ASU 2014-09 will have on our consolidated financial statements and related disclosures. The Company has not yet selected a transition method nor have they determined the effect of the standard on our ongoing financial reporting. Other recent accounting pronouncements issued by the FASB did not or are not believed to have a material impact on our present or future consolidated financial statements.

Note 2-Going Concern

Note 2-Going Concern	12 Months Ended
	Dec. 31, 2016
Notes
Note 2-Going Concern	Note 2—GOING CONCERN During 2016 and 2015, the Company incurred net losses of $8,795,474 and $4,478,725, respectively and had negative cash flows from operations of $928,085 and $1,928,310, respectively. In addition, as of December 31, 2016, the Company had a working capital deficit of $7,599,588. These factors, among others, raise substantial doubt about the Company's ability to continue as a going concern. These consolidated financial statements do not include any adjustments relating to the recoverability and classification of assets or the amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern. The Company's continuation as a going concern is dependent upon our ability to generate sufficient cash flow and raise additional capital to meet our obligations on a timely basis and ultimately attain profitability. If the Company is unable to generate sufficient cash flow or raise additional capital in the new term, it could be forced to cease operations. The Company does not have sufficient capital for the next 12 months from the issuance of these financial statements. The Company's liquidity is highly dependent on its ability to obtain additional capital in the near future. The Company's failure to raise new capital would impair its ability to both continue its current operations and could result in its failure to continue to operate as a going concern. Substantial doubt about its ability to continue as a going concern may also create negative reactions to the price of the Company's common stock, and the Company may not be able to obtain additional financing in the future. The Company is currently exploring potential transactions, specifically through the filing of its Form 14C in January 2017 which will set up the characteristics of the Series D Preferred stock in anticipation of a large financial investment. If the Company is unable to raise additional capital on terms acceptable to the Company and on a timely basis, the Company will be required to downsize or wind down its operations through liquidation, bankruptcy, or a sale of its assets. In addition, to the extent additional capital is raised through the sale of equity or convertible debt securities, such securities may be sold at a discount from the market price of the Company's common stock. The issuance of these securities could also result in significant dilution to some or all of the Company's stockholders, depending on the terms of the transaction.

Note 3-Acquisitions

Note 3-Acquisitions	12 Months Ended
	Dec. 31, 2016
Notes
Note 3-Acquisitions	Note 3—ACQUISITIONS MA & Associates, LLC On April 8, 2014 the Company entered into a Limited Liability Company Membership Interest Purchase Agreement with MA & Associates, LLC ("MA") under which the Company agreed to acquire a 40% equity interest in MA for two testing locations in exchange for a purchase price of $2,000,000 and 150,000 shares of the Company's Series C Preferred Stock. MA was formed to become a cannabis testing laboratory within the State of Nevada. In 2014 and 2015, prior to the purchase of the remaining 60% and obtaining control as discussed below, the Company paid an aggregate of $1,321,419 of the cash portion and issued 100,000 shares of the Series C Preferred Stock. During 2015, prior to taking control through the acquisition of the remaining 60% interest, the consideration paid was originally recorded as an equity method investment, and was subsequently impaired prior to entering into the second investment agreement noted below. On June 3, 2015, the Company entered into a 2nd agreement to acquire the remaining 60% interest in MA for 1,000,000 shares of Series C preferred stock, valued at $1,000,000. In accordance with generally accepted accounting principles ("GAAP") in accounting for a step-acquisition, the Company estimated the fair value of the previously held equity method investment at $667,666, resulting in a total purchase price of approximately $1.7 million. As of December 31, 2015 the Company was still obligated to pay the remaining portion under the original 40% investment agreement, consisting of $678,000 of cash and 50,000 shares of Series C Preferred Stock (valued at $35,000 as of December 31, 2016), totaling $713,581 and included in contingent consideration liability on the accompanying consolidated balance sheet. The remaining contingent consideration will be issued in the future after the testing laboratory is operational. ICPI, who is a related party, was entitled to 500,000 Series C shares as a commission for services related to the MA & Associates LLC., acquisition, of which 300,000 were issued during the year ended December 31, 2015 valued and expensed at $300,000. The remaining 200,000 shares will be issued upon achieving certain milestones in 2016 and this amount has been properly accrued for as of December 31, 2015. As of December 31, 2016, all remaining shares upon achieving certain milestones in 2016 were issued due to settlement to ICPI. The acquisition was accounted for using the purchase method and accordingly, the purchase price was allocated based on the estimated fair market values of the assets acquired and liabilities assumed on the date of each acquisition. ACQUIRED ASSETS : Current assets $ 4,866 Fixed assets 270,811 Other assets 56,985 Total assets acquired $ 332,662 LIABILITIES ASSUMED : Current liabilities $ (11,756 ) Other liabilities (9 ) Total liabilities assumed $ (11,766 ) Net assets acquired $ 320,896 Acquisition Price $ 1,666,667 Intangible Assets from Acquisition $ 1,345,771 The Company obtained a 3rd party valuation for the value of the intangible assets with an estimated life of twenty years. Intangibles related to the acquisition of MA will not be deductible for tax purposes. Management deemed the unaudited pro forma results of operations data for the year ended December 31, 2016 and 2015 immaterial and are thus not shown. The Company, due to the uncertainties surrounding the license agreement, impaired 100% of the value of the Steep Hill Labs licenses due to the purported unsubstantiated termination of the license agreements in June 2016 between Steep Hill Labs and MA & Associates, LLC and Harris Lee, LLC respectively. The Company strongly believes that any attempted termination of the licenses on the part of Steep Hill Labs was ineffective for many reasons, including, without limitation, Steep Hill's failure to provide key deliverables including technology, scientific know-how and lab guidance. Harris Lee Holdings, LLC On July 23, 2014, the Company and the MA founders formed Harris Lee Holdings, LLC ("Harris Lee") of which the Company obtained a 45% equity interest for an initial cash contribution of $45. On October 24, 2014, the Company agreed to acquire an additional 10% interest in Harris Lee in exchange for 300,000 shares of the Company's Series C Preferred stock based on a series of milestone events. As of December 31, 2014, the acquisition of this additional 10% interest had not closed. Then on January 13, 2015, the Company agreed to acquire the remaining 45% of Harris Lee in exchange for 450,000 shares of the Company's Series B Preferred Stock, again issued upon completion of certain milestones. No construction has commenced on any Harris Lee facility and accordingly no cash has been paid to date. No shares were issued in 2014. In 2015, based on the milestones, 150,000 shares of Series C Preferred Stock were issued, and all of the 450,000 shares of Series B Preferred Stock were issued. At December 31, 2014, the Company owned 45% of Harris Lee Holdings, LLC ("Harris Lee"). During 2015, the company acquired the remaining 55% interest in Harris Lee in exchange for 150,000 shares of the Company's Series C Preferred stock to be issued based on a series of milestone events and 450,000 shares of the Company's Series B Preferred Stock. Management deemed it had control of Harris Lee prior to the 2015 preferred issuance. As such, value was considered compensation and not a business combination. The aggregate fair value of the 450,000 Series B and the 150,000 Series C shares was determined to be $219,450 and it was recognized as compensation expense to the sellers of Harris Lee. Harris Lee is now consolidated in the Company's financial results. During the year ended December 31, 2015, Harris Lee was not operating and its impact on the Company's Statement of Operations was zero as it was determined to be nominal. Harris Lee Holdings, LLC has sub-licensed the testing protocols to Harris Lee Colorado, LLC in exchange for a management fee for each test conducted. During 2016, the Colorado MED approved the transfer of management of an existing laboratory, operating as Steep Hill Colorado, to Harris Lee Colorado, LLC (a related party) and Harris Lee Holdings, LLC has derived management fees from Harris Lee Colorado, LLC in the year ending December 31, 2016. However, because of the failure to transfer the MED license to Harris Lee Colorado, LLC, the Denver laboratory was closed by the end 2016. There are currently no plans to re-open the facility in the near future.

Note 4-Fixed Assets

Note 4-Fixed Assets	12 Months Ended
	Dec. 31, 2016
Notes
Note 4-Fixed Assets	Note 4—FIXED ASSETS Fixed assets consists of the following: Fixed Assets Estimated Useful Life (in years) December 31, 2016 December 31, 2015 Cost: Equipment 3-5 $ 643,195 $ 643,195 Furniture and fixture 7 6,687 6,687 Leasehold improvements 3-5 238,620 238,620 Website 3 1,385 1,385 $ 889,887 $ 889,887 Accumulated depreciation and amortization (276,555 ) (140,046 ) Fixed Assets, Net $ 613,332 $ 749,841 Costs of assets acquired under capital leases were approximately $615,000 for the year ended December 31, 2015 and 2016. The capital lease represents a total of three leases for testing equipment. The leases hold an interest rate of 0% and monthly payments are approximately $17,000 per month. The depreciation for the years ended December 31, 2016 and December 31, 2015 was $136,510 and $140,046, respectively. The accumulated depreciation of the assets under the capital lease for the years ended December 31, 2016 and December 31, 2015 was $159,401 and $36,059, respectively. All leased equipment is collateral under the respective lease agreements. As of December 31, 2016 the Company was currently in default of these lease agreements, as scheduled payments were not made. Commencing in 2017 the Company began making payments toward the capital leases again.

Note 5-Intangible Assets and Go

Note 5-Intangible Assets and Goodwill	12 Months Ended
	Dec. 31, 2016
Notes
Note 5-Intangible Assets and Goodwill	Note 5—INTANGIBLE ASSETS AND GOODWILL Intangible assets as of December 31, 2015 consisted of a license agreement acquired for $307,500 from Steep Hill Labs for the right to take the Steep Hill software and methodology to states above and beyond Nevada, and the MA license derived from the acquisition of $1,345,771. During 2016, the Company impaired 100% of the Steep Hill license agreement acquired for $307,500 as well as the MA license derived from acquisition of $1,345,771. The impairment was due to the uncertainties surrounding the license agreement, as well as the purported unsubstantiated termination of the license agreements in June 2016 between Steep Hill Labs and MA & Associates, LLC and Harris Lee, LLC respectively.

Note 6-Lines of Credit

Note 6-Lines of Credit	12 Months Ended
	Dec. 31, 2016
Notes
Note 6-Lines of Credit	Note 6—LINES OF CREDIT The Company entered into a line of credit with Wells Fargo in December 2015 in the amount of $25,000. The credit line bears an interest rate of 9.75% annually, compounded daily, and there is no term on the account. There are no financial covenants and the guarantor on the account is Steve Basloe, the Company's President. The line of credit has been used for general operating expenses. The Company entered into a line of credit with Wells Fargo in May 2016 in the amount of $5,000. The credit line bears an interest rate of 24.24% for the first year and then 9.75% annually, compounded daily, and there is no term on the account. There are no financial covenants and the guarantor on the account is David Cunic, the Company's CEO. The credit has been used for general operating expenses. The combined lines of credit at December 31, 2015 totaled $19,500 compared to $21,039 at December 31, 2016.

Note 7-Related Party Transactio

Note 7-Related Party Transactions	12 Months Ended
	Dec. 31, 2016
Notes
Note 7-Related Party Transactions	Note 7—RELATED PARTY TRANSACTIONS In July 2013, the Company entered into a consulting agreement with an affiliate of Mr. Basloe, a board member and President of the Company. The agreement provides for consulting on marketing-related services for the Company. The amounts paid under this agreement for the years ended December 31, 2016 and December 31, 2015 were $20,500 and $46,617, respectively. In January 2015, the Company entered into a services agreement with a family member of board member Mr. Basloe. The agreement provided for consultation services related to the Colorado recreational and medical marijuana marketplace and onsite retail operations studies in Boulder, CO and Denver, CO. The consultant was granted 250,000 common shares under the agreement which vest after six months. The fair value of the award was determined to be $1,750, of which $1,750 was recognized during the year ended December 31, 2015 as stock-based compensation. In connection with the investments in Harris Lee Holdings, LLC and MA & Associates, LLC the Company issued Series B and Series C Preferred shares to two current board members, Mr. Del Hierro and Mr. Lieberthal. Mr. Del Hierro was issued 150,000 shares of Series B Preferred and 380,000 shares of Series C Preferred. Mr. Lieberthal was issued 150,000 shares of Series B Preferred shares and 332,000 shares of Series C Preferred shares for total compensation of $891,000, which was recorded as stock compensation in 2015. In July 2015 Harris Lee Holdings, LLC entered into a series of agreements related to the operations of the Colorado testing facility being managed by Harris Lee Colorado, LLC. The Managing Member of Harris Lee Colorado, LLC is an immediate family member of Steve Basloe, President and Director of the Company. Among the agreements signed is a sub-license Agreement whereby Harris Lee Holdings, LLC sub-licenses the Steep Hill Labs testing protocol to Harris Lee Colorado, LLC in exchange for licensing fees based on the number of tests conducted by Harris Lee Colorado, LLC. In 2016, the Company managed Harris Lee Colorado, LLC, an existing lab in Denver, Colorado, after receiving approval from the Colorado Marijuana Enforcement Division in February of 2016. Harris Lee Holdings, LLC has sub-licensed the testing protocols to Harris Lee Colorado, LLC in exchange for a management fee for each test conducted. The Colorado MED has recently approved the transfer of management of an existing laboratory, to Harris Lee Colorado, LLC (a related party) and Harris Lee Holdings, LLC has begun to derive management fees from Harris Lee Colorado, LLC. The revenue derived from these management fees for the year ended December 31, 2016 was $30,515. The laboratory is currently closed and the Company does not have plans to re-open in the near future. In August 2016, Pazoo, Inc. entered into a loan agreement with David Cunic, Company CEO, and totaling $5,000. The note has an interest rate of 0.70% and the maturity date is August 2018. As of December 2016, $3,300 remains outstanding. In September 2016, Pazoo, Inc. entered into a loan agreement with Steve Basloe, Company President, and totaling $2,500. The note has an interest rate of 0.70% and the maturity date is September 2018. As of December 2016, $2,500 remains outstanding.

Note 8-Convertible Debt

Note 8-Convertible Debt	12 Months Ended
	Dec. 31, 2016
Notes
Note 8-Convertible Debt	Note 8—CONVERTIBLE DEBT The following table summarizes the changes in the convertible notes during 2015 and 2016: Short Term Long Term Total Balance as of January 1, 2015 - Gross $ 1,309,562 $ 812,500 $ 2,122,062 Cash additions 1,263,287 180,000 1,443,287 Interest added to notes payable 331,193 - 331,193 Cash payments (413,000 ) - (413,000 ) Conversions (1,224,163 ) - (1,224,163 ) Original issue discount 76,156 - 76,156 Total $ 1,343,035 $ 992,500 $ 2,335,535 Less: unamortized discount (533,391 ) (794,036 ) (1,327,427 ) Balance as of December 31, 2015 - Net $ 809,644 $ 198,464 $ 1,008,108 Add back: unamortized discount 533,391 794,036 1,327,427 Balance as of December 31, 2015 - Gross $ 1,343,035 $ 992,500 $ 2,335,535 Cash additions 373,460 300,000 673,460 Interest added to notes payable 111,778 116,600 228,378 Cash payments (118,223 ) - (118,223 ) Conversions (474,777 ) - (474,777 ) Reassignments (103,400 ) 103,400 - Original issue discount 47,575 - 47,575 Total $ 1,179,448 $ 1,512,500 $ 2,691,948 Less: unamortized discount (195,827 ) (110,672 ) (306,499 ) Balance as of December 31, 2016 - Net $ 983,621 $ 1,401,828 $ 2,385,449 The Company received $673,460 of new cash additions in the year ended December 31, 2016. In addition to the funds received, noteholders converted $474,777 during the year ended December 31, 2016 into common stock exclusive of accrued interest. Cash payments consisted of $118,223. Non-cash additions, which are due to the increase in principle for compounding interest, including accrued interest totaled $103,400 in 2016. As of December 31, 2016, the unamortized debt discounts totaled $306,499. The interest rates on the notes ranged from 8% to 12%. The Company received $1,443,287 of new cash additions in the year ended December 31, 2015. In addition to the funds received, noteholders converted $1,224,163 during the year ended December 31, 2015 into common stock exclusive of accrued interest. Non-cash additions, which are due to the increase in principle for compounding interest, including accrued interest, totaled $331,193 in 2015. As of December 31, 2015, the unamortized debt discounts totaled $1,327,427. The Company evaluated all convertible notes describe above under ASC 815 and determined that certain conversion features qualify as derivative liabilities (see Note 10). During the year ended December 31, 2016 the Company incurred approximately $2.4 million of a gain in debt extinguishment primarily as a result of various notes converting to equity, with the corresponding derivative liability value at the date of conversion being written off to debt extinguishment as a gain, offset by the unamortized discount on the convertible debt at the time of conversion. In 2016, the Company modified certain convertible notes aggregating a total of $992,500 to increase the interest rate from 10% to 12% retroactively. The maturity dates of these notes were also extended by 2 years. The modification of notes was accounted for as a gain on debt extinguishment, included in the note above. Additionally, at December 31, 2016, a total of 9 notes with a principle balance of $1,014,103 were past due. The Company has adequately accrued all default interest and associated penalties related to these instruments. Additionally, cross default clauses exist within certain other instruments containing terms which would make the notes immediately due and payable, however no cross default clauses have been triggered as of yet. Future minimum payments owed on the outstanding debt of the Company as of December 31, 2016 are as follows: Year Ended December 31, 2016 2017 2018 2019 2020 2021 Thereafter Total Convertible notes 1,179,448 220,000 - - 1,062,500 230,000 2,691,948 Loans payable 615,801 - - - - - 615,801 Total 1,795,249 220,000 - - 1,062,500 230,000 3,307,749

Note 9-Loans Payable

Note 9-Loans Payable	12 Months Ended
	Dec. 31, 2016
Notes
Note 9-Loans Payable	Note 9—LOANS PAYABLE In September 2015, Pazoo, Inc. entered into a loan note totaling $200,000 with Mark Sarna and Sarna Family Limited Partnership. The note has an interest rate of 15.0% and matured September 22, 2016. As of December 31, 2016, $222,217 still remains outstanding due to accrued interest and an increase in interest to 22.5% payable in monthly payments from the revenue from the Las Vegas laboratory and have not yet commenced. In January 2016, Pazoo, Inc. entered into a note totaling $5,000 with RBF Unlimited, LLC. The note has an interest rate of 0.70% and matures January 27, 2017. As of December 31, 2016, loan was paid back in full. In January 2016, Pazoo, Inc. entered into a loan agreement with Kabbage Loans totaling $9,100. The loan has a monthly payment consisting of $500 to the principal and $210 to fees, totaling a monthly cost of $710. The loan will be paid off in a maximum of 12 months. As of December 31, 2016, this loan was paid off. In February 2016, Pazoo, Inc. entered into a loan totaling $25,000 with LG Capital, LLC. The note has an interest of 8.0% and it matures on October 4, 2017. As of December 31, 2016, $25,000 still remains outstanding. In June 2016, Pazoo, Inc. entered into a loan agreement with Kabbage Loans totaling $35,000. The loan will be paid off in a maximum of 12 months and has a monthly payment consisting of $3,792 to the principal and $875 to fees, totaling a monthly cost of $4,667. As of December 31, 2016, $18,387 remains outstanding. In July 2016, Pazoo, Inc. entered into a loan agreement with Kabbage Loans totaling $7,500. The loan will be paid off in a maximum of 6 months and has a monthly payment consisting of $1,250 to the principal and $188 to fees, totaling a monthly cost of $1,438. As of December 31, 2016, $1,092 remains outstanding. In August 2016, Pazoo, Inc, entered into loan agreements totaling an aggregate of $96,000 with a private investor. The notes have an interest rate of 8.0% and maturity dates range from October 2016 to August 2017. As of December 31, 2016, $84,000 still remains outstanding. In August 2016, Pazoo, Inc. entered into a loan agreement with David Cunic, Company CEO, and totaling $5,000. The note has an interest rate of 0.70% and the maturity date is August 2018. As of December 2016, $3,300 remains outstanding. In September 2016, Pazoo, Inc. entered into a loan agreement with Kabbage Loans totaling $7,700. The loan will be paid off in a maximum of 6 months and has a monthly payment consisting of $1,284 to the principal and $193 to fees, totaling a monthly cost of $1,477. As of December 31, 2016, $5,472 remains outstanding. In September 2016, Pazoo, Inc. entered into a loan agreement with Steve Basloe, Company President, and totaling $2,500. The note has an interest rate of 0.70% and the maturity date is September 2018. As of December 2016, $2,500 remains outstanding. In October 2016, Pazoo, Inc, entered into loan agreements totaling an aggregate of $112,000 with a private investor. The notes have an interest rate of 8.0% and maturity dates of October 2017. As of December 31, 2016, $112,000 still remains outstanding. In November 2016, Pazoo, Inc, entered into loan agreements totaling an aggregate of $33,000 with a private investor. The notes have an interest rate of 8.0% and maturity dates of November 2017. As of December 31, 2016, $33,000 still remains outstanding. In December 2016, Pazoo, Inc, entered into loan agreements totaling an aggregate of $95,000 with a private investor. The notes have an interest rate of 8.0% and maturity dates of December 2017. As of December 31, 2016, $95,000 still remains outstanding. In December 2016, Pazoo, Inc. entered into a loan agreement with Kabbage Loans totaling $16,000. The loan will be paid off in a maximum of 12 months and has a monthly payment consisting of $1,334 to the principal and $400 to fees, totaling a monthly cost of $1,734. As of December 31, 2016, $13,333 remains outstanding.

Note 10-Derivative Liabilities

Note 10-Derivative Liabilities	12 Months Ended
	Dec. 31, 2016
Notes
Note 10-Derivative Liabilities	Note 10—DERIVATIVE LIABILITIES The Company evaluates all of its financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives. For derivative financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value and is then re-valued at each reporting date, with changes in the fair value reported as charges or credits to income. For option-based derivative financial instruments, the Company uses the Black-Scholes option-pricing model to value the derivative instruments at inception and subsequent valuation dates. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is re-assessed at the end of each reporting period. Under ASC-815 the conversion options embedded in the notes payable described in Note 9 require liability classification because they do not contain an explicit limit to the number of shares that could be issued upon settlement. In addition, all of the Company's outstanding common stock warrants include price protection clauses and are accounted for as derivative liabilities. The following table summarizes the changes in the derivative liabilities during 2015 and 2016: Balance as of January 1, 2015 $ 2,576,025 Initial value derivatives 5,962,270 Extinguished (4,014,734 ) Change in fair value (2,767,126 ) Balance as of December 31, 2015 $ 1,756,435 Initial value derivatives 4,070,636 Extinguished (3,891,703 ) Change in fair value 990,165 Balance as of December 31, 2016 $ 2,925,627 During 2016 and 2015, the aggregate loss on derivative liabilities was $3,827,703 and $898,759, respectively, consisting of initial derivative expense, which was in excess of debt at inception, and the change in the fair value of the derivative liabilities. The Company uses the Black Scholes Option Pricing Model to value its convertible debt and warrant derivative liabilities based upon the following assumptions: 2015 2016 Dividend yield: 0 % 0 % Expected volatility 145.0% to 228.0 % 163.0% to 489.2 % Risk free interest rate .03% to 1.63 % .51% to 1.93 % Expected life (years) 0.13 to 4.89 0.09 to 5.05

Note 11-Stockholders' Equity

Note 11-Stockholders' Equity	12 Months Ended
	Dec. 31, 2016
Notes
Note 11-Stockholders' Equity	Note 11—STOCKHOLDERS' EQUITY Preferred Stock On August 14, 2015 the Company filed a Definitive Information Statement with the SEC on Form 14C with regard to changes in its capital structure. On October 1, 2015 the Company filed an Amendment to its Articles of Incorporation authorizing 50 million shares of $0.001 par value Preferred Stock. The preferred shares available for issuance are 10,000,000 Series A Convertible Preferred Stock, 5,000,000 Series B Convertible Preferred Stock, 10,000,000 Series C Convertible Preferred Stock, 12,500,000 Series D Preferred Stock, and 12,500,000 Series E Preferred Stock. The Series A Preferred Stock does not have voting rights and earns a Series A Preferred Stock dividend of 5% annually and has an expiration date of February 1, 2022. The Company shall pay the amount due on the Maturity Date in kind with shares of Common Stock. The number of shares of Common Stock to be issuable to a Holder on the Maturity Date (the "Maturity Shares") shall be equal to the quotient of (x) the aggregate Liquidation Preference for such Holder's Shares on the Maturity Date divided by (y) the Conversion Price in effect as of the Maturity Date. On or before the third (3rd) Business Day following the Maturity Date (the "Maturity Share Delivery Date"), the Company must deliver to each Holder the Maturity Shares issuable to such Holder. In the event of any liquidation, dissolution or winding up of the Company, either voluntarily or involuntarily, each Holder shall be entitled to receive prior and in preference to any distribution of any of the assets or surplus funds of the Company to the holders of any Junior Stock, an amount (the "Liquidation Preference") equal to (A) $1,000 per Share held by such Holder, plus (B) a further amount equal to any Dividends accrued but unpaid on such Shares. If, upon such liquidation, dissolution or winding up of the Company, the assets of the Company available for distribution to the stockholders of the Company are insufficient to provide for the payment of the full aforesaid preferential amount, such assets as are so available shall be distributed among the Holders in proportion to the relative aggregate Liquidation Preferences of the Shares held by such Holders. The Liquidation Preference shall be appropriately adjusted for any stock splits, stock combinations, stock dividends or similar recapitalizations. The Series B Preferred Stock is convertible in accordance with the terms of the Certificate of Designations, does not pay a dividend, and contains preferential voting rights. On August 14, 2015 the Company filed a Definitive Information Statement with the SEC on Form 14C increased the voting rights from a ratio of 200 votes for each share of Series B Preferred Stock to 1,000 votes for each share of Series B Preferred Stock. In the event of any liquidation, dissolution or winding up of the Company, either voluntarily or involuntarily, each Holder shall be entitled to receive prior and in preference to any distribution of any of the assets or surplus funds of the Company to the holders of any Junior Stock, an amount (the "Liquidation Preference") equal to $0.001 per Share held by such Holder, or such other amount as any Securities Purchase Agreement under which the Shares are issued may provide. If, upon such liquidation, dissolution or winding up of the Company, the assets of the Company available for distribution to the stockholders of the Company are insufficient to provide for the payment of the full aforesaid preferential amount, such assets as are so available shall be distributed among the Holders in proportion to the relative aggregate Liquidation Preferences of the Shares held by such Holders. The Liquidation Preference shall be unaffected for any stock splits, stock combinations, stock dividends or similar recapitalizations. The Series C Preferred Stock is convertible and has no voting rights and has an expiration date for redemption to February 1, 2022. The Company shall pay the amount due on the Maturity Date in kind with shares of Common Stock. The number of shares of Common Stock to be issuable to a Holder on the Maturity Date (the "Maturity Shares") shall be equal to the quotient of (x) the aggregate Liquidation Preference for such Holder's Shares on the Maturity Date divided by (y) the Conversion Price in effect as of the Maturity Date. On or before the third (3rd) Business Day following the Maturity Date (the "Maturity Share Delivery Date"), the Company must deliver to each Holder the Maturity Shares issuable to such Holder. In the event of any liquidation, dissolution or winding up of the Company, either voluntarily or involuntarily, each Holder shall be entitled to receive prior and in preference to any distribution of any of the assets or surplus funds of the Company to the holders of any Junior Stock, an amount (the "Liquidation Preference") equal to (A) $0.001 per Share held by such Holder. If, upon such liquidation, dissolution or winding up of the Company, the assets of the Company available for distribution to the stockholders of the Company are insufficient to provide for the payment of the full aforesaid preferential amount, such assets as are so available shall be distributed among the Holders in proportion to the relative aggregate Liquidation Preferences of the Shares held by such Holders. The Liquidation Preference shall be appropriately adjusted for any stock splits, stock combinations, stock dividends or similar recapitalizations. The conversion rates for Series A and C Preferred Stock are 1:100 to common stock. The conversion rate for Series B convertible stock is 1:200. Series B was convertible contingent on certain liquidation events such as mergers and sales, which occurred. No Series of Preferred Stock is effected by reverse splits or recapitalizations. The Company's Series D and Series E Preferred shares terms and conditions are not yet determined and neither certificates of designation have been filed with the State of Nevada. The Company and ICPI have engaged in a total of six investment agreements between the time of January 2011 and April 2016, with the last amendment to Investment Agreement No. 6 in November 2016. All of the investment agreements between ICPI and the Company provide for Series A Preferred Stock to be issued by the Company upon a cash investment provided to the Company by ICPI. ICPI makes up the majority of the Series A Preferred Stock outstanding at December 31, 2015 and 2016. In April 2016, pursuant to a Settlement Agreement with ICPI, all remaining Series A Warrants have been retired in exchange for the issuance of Series C Preferred Stock. A total of 2,200,000 Series C Preferred Shares were issued to ICPI in exchange for the retirement of all remaining Series A Warrants and the waiver of unpaid dividends on Series A Preferred stock held by ICPI for the years 2014, 2015 and 2016. Total stock-based compensation recognized during 2016 totaled $79,900 consisting of 60,000 common stock and 77,500 Series C Preferred stock issued for services. Total stock-based compensation recognized during 2015 totaled $1,221,981, consisting of 522,208 common shares and 50,000 Series A preferred shares, 575,000 Series B preferred shares and 803,000 Series C preferred shares, issued for services. Series A In 2015, the Company sold an aggregate of 2,542,132 Series A Preferred Stock for cash proceeds of $580,000. In 2015, the Company issued an aggregate of 50,000 Series A Preferred Stock for services, valued at a total of $20,300. During 2015, 3,115,000 shares of Series A Preferred stock were converted into 3,115,000 common shares. In 2015, ICPI exercised warrants in the amount of 347,143 Series A Preferred Stock warrants for cash proceeds of $25,000. Total Series A Preferred shares outstanding as of December 31, 2015 were 860,669. In 2016, the Company issued an aggregate of 61,306 Series A Preferred Stock for settlement, valued at a total of $30,652. During 2016, 691,629 shares of Series A Preferred stock were converted into 34,658,826 common shares. Total Series A Preferred shares outstanding as of December 31, 2016 were 230,401. Series B In 2015, the Company issued an aggregate of 450,000 Series B Preferred Stock in connection with the MA and Associates, LLC, which was recorded as stock compensation and issued 125,000 Series B Preferred Stock as compensation. Total Series B Preferred shares outstanding as of December 31, 2015 and 2016 were 1,762,500. Series C In 2015, the Company issued an aggregate of 1,803,000 Series C Preferred Stock for services. In 2015, the Company sold an aggregate of 448,000 Series C Preferred Stock for cash proceeds of $448,000. During 2015, 200,000 Series C Preferred Stock were converted into 200,000 common shares. Total Series C Preferred shares outstanding as of December 31, 2015 were 2,051,000. In 2016, the Company issued an aggregate of 2,277,500 Series C Preferred Stock for services consisting of 2,200,000 shares to ICPI per the previously disclosed settlement agreement and the remaining 77,500 shares to marketing consultants. In 2016, the Company sold an aggregate of 128,572 Series C Preferred Stock for cash proceeds of $90,000. During 2016, 1,835,697 Series C Preferred Stock were converted into 183,569,700 common shares. Total Series C Preferred shares outstanding as of December 31, 2016 were 2,621,375. Series D&E In 2015, there have been no issuances or sales of Series D Preferred Stock or Series E Preferred Stock. Common Stock Issuances In 2015, the Company issued a total of 54,601 common shares for aggregate cash proceeds of $48,380, in accordance with an agreement with Premier Venture Capital. In 2015, the Company issued a total of 522,208 common shares to consultants and experts who have agreed to be included in the "Our Experts" section of our Company website ( www.pazoo.com In 2015, the Company issued 9,042,939 common shares with debt or for the conversion of debt valued at $1,396,995. In 2016, the Company issued a total of 60,000 common shares for services. In 2016, the Company issued an aggregate of 2,051,253,840 common shares for the conversion of debt and accrued interest totaling $1,042,688. Preferred Stock Warrants In 2015, the Company issued 2,325,000 Series A Preferred Stock warrants with an exercise price of $0.50. In 2015, ICPI exercised 347,143 Series A Preferred Stock warrants for cash proceeds of $25,000. In 2016, pursuant to a Settlement Agreement with ICPI, all remaining Series A Warrants have been retired in exchange for the issuance of Series C Preferred Stock. A total of 1,700,000 Series C Preferred Shares were issued to ICPI in exchange for the retirement of all remaining Series A Warrants and the waiver of unpaid dividends on Series A Preferred stock held by ICPI for the years 2014, 2015 and 2016. Additionally, 500,000 Series C preferred shares were issued to ICPI for settlement of liability to issue shares for services. The following table presents the Series A preferred stock warrant activity during 2016 and 2015: Weighted Average Warrants Exercise Price Outstanding – December 31, 2014 1,030,226 $ 2.23 Granted 2,325,000 0.50 Forfeited/canceled (50,000 ) 0.05 Exercised (347,143 ) 0.01 Outstanding – December 31, 2015 2,958,083 $ 1.17 Granted - - Forfeited/canceled (2,958,083 ) 1.17 Exercised - - Outstanding – December 31, 2016 - $ - Exercisable – December 31, 2016 - $ - The weighted average remaining life of the outstanding Series A preferred stock warrants as of December 31, 2016 and December 31, 2015 was 0.00 and 4.22 years, respectively. Common Stock Warrants The following table presents the common stock warrant activity during 2016 and 2015: Warrants Weighted Average Exercise Price Outstanding - December 31, 2014 3,930,470 $ 0.05 Granted - - Forfeited/canceled (2,600,000 ) 0.05 Exercised (1,330,740 ) 0.05 Outstanding - December 31, 2015 - $ - Granted - - Forfeited/canceled - - Exercised - - Outstanding – December 31, 2016 - $ - Exercisable – December 31, 2016 - $ - As of December 31, 2015 and December 31, 2016, no warrants for common stock were outstanding. On June 22, 2015 Typenex Co-Investments, LLC submitted a cashless warrant Notice of Exercise seeking 529,682 shares pursuant to a Warrant dated on or about May 14, 2014. The Company disputed the Notice of Exercise due to what the company believes was bad faith upon the holder acting in such a fashion to deflate the Company's stock price in order to obtain more share under the Warrant. On or about July 29, 2015 the Company permitted Typenex to submit a new Notice of Exercise for 45,000 shares. It is the Company's position that Typenex is not entitled to any additional shares under the Warrant. The Company and Typenex have reached an agreement in principal to resolve this dispute. Under the terms of the proposed settlement, Typenex will be issued common stock of the Company in the total aggregate value of $50,000. Typenex is prohibiting from holding more than 4.99% of the outstanding common stock of the Company and will be subject to leak out provisions restricting the amount of stock of the Company that sold. The stock was issued in 2016 and is included in the common shares issued for conversion of debt.

Note 12-Income Taxes

Note 12-Income Taxes	12 Months Ended
	Dec. 31, 2016
Notes
Note 12-Income Taxes	Note 12—INCOME TAXES The Company uses the liability method, where deferred tax assets and liabilities are determined based on the expected future tax consequences of temporary differences between the carrying amounts of assets and liabilities for financial and income tax reporting purposes. During 2015 and 2016, the company incurred net losses and, therefore, has no tax liability. The net deferred tax asset generated by the loss carry-forward has been fully reserved. The cumulative net operating loss carry-forward is approximately $11,255,000 at December 31, 2016, and will expire in the years 2032 – 2034. Internal Revenue Section 382 restricts the ability to use these carryforwards whenever an ownership change as defined occurs. A change in ownership may be deemed to have occurred, which may limit the net operating loss carry forward value pursuant to Section 382 of the Tax Code. At December 31, 2016, deferred tax assets consisted of the following: Deferred tax assets Net operating losses $ 4,389,477 Less: valuation allowance (4,389,477) Net deferred tax asset $ - At December 31, 2015, deferred tax assets consisted of the following: Deferred tax assets Net operating losses $ 3,171,007 Less: valuation allowance (3,171,007) Net deferred tax asset $ - A reconciliation of the U.S. Federal statutory tax rate to our annual tax rate is as follows: 2016 2015 U.S. Federal statutory tax rate 35.0 % 35.0 % State income tax, net of U.S. Federal tax benefit 6.5 % 6.5 % Change in valuation allowance (41.5 %) (41.5 %) Annual tax rate 0.0 % 0.0 %

Note 13-Commitments

Note 13-Commitments	12 Months Ended
	Dec. 31, 2016
Notes
Note 13-Commitments	Note 13—COMMITMENTS On March 10, 2015, Harris Lee signed a 9-year licensing agreement with Steep Hill Labs, LLC, with options to renew for an additional 9 years. The purpose of the agreement is to take the Steep Hill licensing to additional states to test medical marijuana above and beyond the State of Nevada, namely Oregon and Colorado. Under the license agreement for the first two states (Oregon and Colorado), if certain gross revenue thresholds are met, the Company is obligated to pay an additional $250,000. In addition, the Company is obligated to pay certain royalties over the life of the license agreement to Steep Hill Labs, Inc, based on the greater of the number of tests ($5 dollars a test) or an escalating royalty rate (7% to 15%) of the initial purchase price. The Company has the option to enter into additional states with similar commitments and royalties. In June 2016, the Company, due to the uncertainties surrounding the license agreement with Steep Hill, impaired 100% of the value of the Steep Hill Labs licenses due to the purported unsubstantiated termination of the license agreements in June 2016 between Steep Hill Labs and MA & Associates, LLC and Harris Lee, LLC respectively. In 2015, MA and Associates, LLC entered into various capital lease agreements to finance fixed asset purchases for approximately $615,000. Total monthly payments over the 36 month terms are approximately $17,000. The Company's subsidiary MA and Associates, LLC rents space in Nevada with a 60 month term ending in May of 2019, with monthly rent expense of $1,632. As of December 31, 2016 the Company was still obligated to pay the remaining portion under the original 2014 40% investment agreement with MA and Associates, LLC, consisting of $678,000 of cash and 50,000 shares of Series C Preferred Stock (valued at $35,000 as of December 31, 2016), totaling $713,581 and included in contingent consideration liability on the accompanying consolidated balance sheet and will be issued in the future after the testing laboratory is operational.

Note 14-Subsequent Events

Note 14-Subsequent Events	12 Months Ended
	Dec. 31, 2016
Notes
Note 14-Subsequent Events	Note 14—SUBSEQUENT EVENTS On January 4, 2017 the Company's 100% wholly owned subsidiary MA & Associates received its final approval and Marijuana Testing License from the City of Las Vegas, NV and can now commence operations. The company issued an aggregate of 343,182,474 common shares to debt holders valued at a total of $27,758 for conversions pursuant to convertible notes. In 2017, the Company entered into loan advances with a private investor for $354,000. The advances are in conjunction with the investment for Preferred D shares disclosed in the Form 14C filed in January of 2017. In 2017, the Company entered into convertible note agreements for an aggregate total of $303,178. The interest rates range from 10% to 12% and the conversion terms range between a 35% to 50% discount to the prior range of 15 to 30 days. The Company has paid back a total of $160,720 on the aforementioned convertible note agreements. In 2017, the Company issued 387,500 Series B preferred stock in exchange for services. In 2017, the Company issued a total of 75 Series A Preferred stock in dividends for Series A Preferred shareholders. In 2017, the Company entered into a loan agreement with Kabbage, Inc for $10,500. The note will be paid off in 12 months and carries a monthly fee of $262.50. In 2017, the Company filed a Form 14-C in order to effectuate a 1-for-250 reverse stock split of the outstanding common stock (the "Reverse Stock Split") whereby every two hundred and fifty (250 shares of outstanding common stock decreases to one (1) share of common stock. The current Reverse Stock Split is still pending and has not yet gone effective, pending FINRA approval. In January 2017, the Company filed a Form 14-C Information Statement advising all shareholders of the Company that the Board of Directors, as ratified by the majority of the votes of equity holders, approved of a reverse stock split (at a ratio of 250:1) and setting forth the proposed terms and characteristics of the Series D Preferred Stock. The Series D Preferred Stock will carry a 5% annual dividend, will have no voting rights prior to conversion, and will convert into common stock at a ratio which will be determined by the amount of debt to be retired, and new money to be invested, and the then outstanding common stock of the Company on a fully diluted basis (See, the filed Form 14C for more details). The purpose of reconstituting the characteristics of the Series D Preferred Stock is to have the ability to consummate the contemplated sale of the Company's Series D Preferred Stock as set forth in the Form 14C. If, and when, the agreement has been finalized for the sale of the Series D Preferred Stock, the characteristics of the Series D Preferred Stock will be set forth in a Certificate of Designations to be filed with the Secretary of State of the State of Nevada. If the characteristics are substantively different than as previously approved by the Board of Directors, and ratified by the majority of the votes of equity holders, new approval will be sought.

Note 1-Description of Busines21

Note 1-Description of Business, Basis of Presentation and Summary of Significant Accounting Policies: Description of Business (Policies)	12 Months Ended
	Dec. 31, 2016
Policies
Description of Business	Description of Business The Company entered the pharmaceutical testing laboratory market with their acquisitions of MA & Associates, LLC which will operate pharmaceutical testing laboratories in Nevada, and Harris Lee Holdings, LLC which will operate pharmaceutical testing laboratories within other states, or license testing protocols as independently owned laboratories. These pharmaceutical testing laboratories focus on providing quality control services to the medical cannabis industry. The mission is to protect the public health by providing infrastructure and analytical services to legally-authorized cannabis producers and distributors as well as to regulators. States that have legalized cannabis are developing cannabis health and safety criteria that we will fulfill through their testing laboratories. Harris Lee Holdings, LLC, due to Colorado residency requirements, entered into an advisory agreement with Harris Lee Colorado, LLC, a related party. Harris Lee Holdings, LLC has sub-licensed the testing protocols to Harris Lee Colorado, LLC in exchange for management fees for each test conducted. The Colorado MED approved the transfer of management of an existing laboratory, operating as Steep Hill Colorado, to Harris Lee Colorado, LLC (a related party) and Harris Lee Holdings, LLC has derived management fees from Harris Lee Colorado, LLC in the year ending December 31, 2016. However, because of the failure to transfer the MED license to Harris Lee Colorado, LLC, the Denver laboratory was closed by the end 2016. The Company does not expect to re-commence operations in the near future. Lastly, the Company's wholly owned subsidiary, CK Distribution LLC, provides the marketing and sales agent for the distribution of non-controlled hemp products throughout the USA. Non-controlled hemp products are the items utilized by the industry that support grow facilities, infusion companies and dispensaries. Further, the business consists of pazoo.com, an online, content driven, ad supported health and wellness web site for people and their pets. Additionally, this site has e-commerce functionality which allows pazoo.com to be an online retailer of nutritional foods/supplements, wellness goods, and fitness apparel. Pazoo, Inc. does not have any brick and mortar establishments.

Note 1-Description of Busines22

Note 1-Description of Business, Basis of Presentation and Summary of Significant Accounting Policies: Basis of Presentation (Policies)	12 Months Ended
	Dec. 31, 2016
Policies
Basis of Presentation	Basis of Presentation The accompanying consolidated financial statements include the accounts of the Pazoo, Inc. ("Pazoo" or the "Company") and its wholly-owned subsidiaries MA & Associates, LLC, Harris Lee Holdings LLC, and CK Distribution. These consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States ("GAAP"). All significant inter-company transactions and accounts have been eliminated in consolidation. In March 2016, the Company effected a 1-for-100 reverse stock split of the outstanding common stock (the "Reverse Stock Split") whereby every one hundred (100) shares of outstanding common stock decreased to one (1) share of common stock. Similarly, the number of shares of common stock, par value $0.001 ("Common Stock") into which each outstanding Preferred stock, convertible debt and warrant to purchase common stock is to be exercisable decreased on a 1-for-100 basis and the exercise price of each outstanding preferred stock and warrant to purchase common stock increased proportionately. The impact of this reverse stock split has been retroactively applied to the financial statements and the related notes and all debt terms were also adjusted/effected. In January 2017, the Company filed a Form 14-C in order to effectuate a 1-for-250 reverse stock split of the outstanding common stock (the "Reverse Stock Split") whereby every two hundred and fifty (250 shares of outstanding common stock decreases to one (1) share of common stock. The current Reverse Stock Split is still pending and has not yet gone effective, and is pending FINRA approval. All Preferred shares of stock are not effected by reverse splits or re-capitalizations.

Note 1-Description of Busines23

Note 1-Description of Business, Basis of Presentation and Summary of Significant Accounting Policies: Use of Estimates (Policies)	12 Months Ended
	Dec. 31, 2016
Policies
Use of Estimates	Use of Estimates In accordance with GAAP the preparation of these consolidated financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the consolidated financial statements and the reported amount of revenues and expenses during the reporting period. On an ongoing basis, management evaluates its estimates and judgments, including those related to revenue recognition, accrued expenses, financing operations, and contingencies and litigation. Management bases its estimates and judgments on historical experience and on various other factors that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions and conditions. The most significant accounting estimates inherent in the preparation of the Company's financial statements include estimates as to the appropriate carrying value of certain assets and liabilities which are not readily apparent from other sources. These accounting policies are described at relevant sections in the notes to the financial statements.

Note 1-Description of Busines24

Note 1-Description of Business, Basis of Presentation and Summary of Significant Accounting Policies: Principles of Consolidation (Policies)	12 Months Ended
	Dec. 31, 2016
Policies
Principles of Consolidation	Principles of Consolidation The consolidated financial statements include the accounts of Pazoo and its subsidiaries, which are wholly owned. All significant intercompany transactions and balances have been eliminated in consolidation.

Note 1-Description of Busines25

Note 1-Description of Business, Basis of Presentation and Summary of Significant Accounting Policies: Fixed Asset (Policies)	12 Months Ended
	Dec. 31, 2016
Policies
Fixed Asset	Fixed Asset Fixed assets are presented at cost at the date of acquisition. Depreciation and amortization is calculated based on the straight-line method over the estimated useful lives of the depreciable assets, or in the case of leasehold improvements, the shorter of the lease term or the estimated useful life of the asset, a portion of which is allocated to cost of sales. Improvements are capitalized while repairs and maintenance are charged to operations as incurred.

Note 1-Description of Busines26

Note 1-Description of Business, Basis of Presentation and Summary of Significant Accounting Policies: Impairment of Long-lived Assets (Policies)	12 Months Ended
	Dec. 31, 2016
Policies
Impairment of Long-lived Assets	Impairment of Long-Lived Assets The Company's intangible assets and fixed assets are reviewed for impairment whenever events or changes in circumstances indicate that the historical-cost carrying value of an asset may no longer be appropriate. The Company assesses recoverability of the asset by comparing the undiscounted future net cash flows expected to result from the asset to its carrying value. If the carrying value exceeds the undiscounted future net cash flows of the asset, an impairment loss is measured and recognized. An impairment loss is measured as the difference between the net book value and the fair value of the long-lived asset. The Company, due to the uncertainties surrounding the license agreement, impaired 100% of the value of the Steep Hill Labs licenses due to the purported unsubstantiated termination of the license agreements in June 2016 between Steep Hill Labs and MA & Associates, LLC and Harris Lee, LLC respectively. The Company strongly believes that any attempted termination of the licenses on the part of Steep Hill Labs was ineffective for many reasons, including, without limitation, Steep Hill's failure to provide key deliverables including technology, scientific know-how and lab guidance. On July 6, 2016, the Company contested the improper attempted termination of the licenses which was based on no identifiable contractual justification, and to which Steep Hill has not formally responded. To the contrary, as of the date of this Report, Steep Hill Labs continues to list the Company as one of its "partners" and continues to display the Company's Las Vegas facility as a Steep Hill location. If Steep Hill Labs takes any further action to effectuate the ineffective termination of the licenses, this matter will be litigated under the terms and conditions of the respective license agreements, which management will vigorously defend.

Note 1-Description of Busines27

Note 1-Description of Business, Basis of Presentation and Summary of Significant Accounting Policies: Fair Value of Financial Instruments (Policies)	12 Months Ended
	Dec. 31, 2016
Policies
Fair Value of Financial Instruments	Fair Value of Financial Instruments The Company's financial instruments consist principally of cash and cash equivalents and accounts payable. The Company believes that the recorded values of all of its other financial instruments approximate their fair values because of their nature and respective maturity dates or durations. Assets and liabilities measured at fair value are categorized based on whether or not the inputs are observable in the market and the degree that the inputs are observable. The categorization of financial instruments within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The hierarchy is prioritized into three levels (with Level 3 being the lowest) defined as follows: Level 1: Level 2: Level 3: The following table sets forth by level within the fair value hierarchy the Company's financial assets and liabilities that were accounted for at fair value as December 31, 2016 and 2015. Recurring Fair Value Measurements Level 1 Level 2 Level 3 Total LIABILITIES: Derivative liability – December 31, 2016 $ - $ - $ 2,925,627 $ 2,925,627 Derivative liability – December 31, 2015 $ - $ - $ 1,756,435 $ 1,756,435 The Company has certain convertible notes outstanding at December 31, 2016 and 2015 with variable conversion rates that qualify as derivatives that need to be separately accounted for in accordance with FASB ASC 815, "Derivatives and Hedging"

Note 1-Description of Busines28

Note 1-Description of Business, Basis of Presentation and Summary of Significant Accounting Policies: Cash and Cash Equivalents (Policies)	12 Months Ended
	Dec. 31, 2016
Policies
Cash and Cash Equivalents	Cash and Cash Equivalents We classify all highly liquid instruments with an original maturity of three months or less at the time of purchase as cash equivalents.

Note 1-Description of Busines29

Note 1-Description of Business, Basis of Presentation and Summary of Significant Accounting Policies: Stock Based Compensation (Policies)	12 Months Ended
	Dec. 31, 2016
Policies
Stock Based Compensation	Stock Based Compensation ASC 718 "Compensation - Stock Compensation" prescribes accounting and reporting standards for all stock-based payments awarded to employees, including employee stock options, restricted stock, employee stock purchase plans and stock appreciation rights, which may be classified as either equity or liabilities. The Company determines if a present obligation to settle the share-based payment transaction in cash or other assets exists. A present obligation to settle in cash or other assets exists if: (a) the option to settle by issuing equity instruments lacks commercial substance or (b) the present obligation is implied because of an entity's past practices or stated policies. If a present obligation exists, the transaction is recognized as a liability; otherwise, the transaction is recognized as equity. The Company accounts for stock-based compensation issued to non-employees and consultants in accordance with the provisions of ASC 505-50 "Equity-Based Payments to Non-Employees." Measurement of share-based payment transactions with non-employees is based on the fair value of whichever is more reliably measurable: (a) the goods or services received; or (b) the equity instruments issued. The fair value of the share-based payment transaction is determined at the earlier of performance commitment date, the performance completion date, or the contract date.

Note 1-Description of Busines30

Note 1-Description of Business, Basis of Presentation and Summary of Significant Accounting Policies: Revenue Recognition (Policies)	12 Months Ended
	Dec. 31, 2016
Policies
Revenue Recognition	Revenue Recognition Revenues are recognized when evidence of an agreement exists, the price is fixed or determinable, collectability is reasonably assured and goods have been delivered or services performed. The Company is paid revenue from various advertising, cannabis testing, management fees, and sales and distribution of non-controlled hemp products. During the year ended 2016, the Company's only recognized revenues were derived from management fees.

Note 1-Description of Busines31

Note 1-Description of Business, Basis of Presentation and Summary of Significant Accounting Policies: Income Taxes (Policies)	12 Months Ended
	Dec. 31, 2016
Policies
Income Taxes	Income Taxes Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. These assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which the temporary differences are expected to reverse. We have net operating loss carryforwards available to reduce future taxable income. Future tax benefits for these net operating loss carryforwards are recognized to the extent that realization of these benefits is considered more likely than not. To the extent that we will not realize a future tax benefit, a valuation allowance is established.

Note 1-Description of Busines32

Note 1-Description of Business, Basis of Presentation and Summary of Significant Accounting Policies: Basic and Diluted Net Loss Per Common Share (Policies)	12 Months Ended
	Dec. 31, 2016
Policies
Basic and Diluted Net Loss Per Common Share	Basic and Diluted Net Loss Per Common Share Basic net loss per common share is computed by dividing net loss applicable to common stockholders by the weighted average number of common shares outstanding during the period. Diluted net loss per common share reflects, in addition to the weighted average number of common shares, the potential dilution if shares of convertible preferred stock and debt were converted into shares of common stock and a corresponding accrued 5% dividend, unless the effects of such exercises and conversions would have been anti-dilutive. Potentially Dilutive Securities December 31, 2016 December 31, 2015 Common stock warrants - 3,355 Convertible notes 32,355,840,300 92,239,381 Preferred series A shares & warrants 23,040,100 86,066,900 Preferred series B 352,000,000 352,000,000 Preferred series C 262,137,500 205,100,000 32,993,017,900 735,409,636

Note 1-Description of Busines33

Note 1-Description of Business, Basis of Presentation and Summary of Significant Accounting Policies: Advertising Expenses (Policies)	12 Months Ended
	Dec. 31, 2016
Policies
Advertising Expenses	Advertising Expenses Costs associated with advertising are charged to expense as incurred.

Note 1-Description of Busines34

Note 1-Description of Business, Basis of Presentation and Summary of Significant Accounting Policies: Recent Accounting Pronouncements (Policies)	12 Months Ended
	Dec. 31, 2016
Policies
Recent Accounting Pronouncements	Recent Accounting Pronouncements February 2016, the Financial Accounting Standards Board ("FASB") issued new guidance related to how an entity should recognize lease assets and lease liabilities. The guidance specifies that an entity who is a lessee under lease agreements should recognize lease assets and lease liabilities for those leases classified as operating leases under previous FASB guidance. Accounting for leases by lessors is largely unchanged under the new guidance. The guidance is effective for us beginning in the first quarter of 2019. Early adoption is permitted. In transition, lessees and lessors are required to recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach. The Company is evaluating the impact of adopting this guidance on our consolidated financial condition, results of operations and cash flows. In March 2016, the FASB issued new guidance which involves several aspects of the accounting for share-based payment transactions including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. Under the new standard, income tax benefits and deficiencies are to be recognized as income tax expense or benefit in the income statement and the tax effects of exercised or vested awards should be treated as discrete items in the reporting period in which they occur. An entity should also recognize excess tax benefits regardless of whether the benefit reduces taxes payable in the current period. Excess tax benefits should be classified along with other income tax cash flows as an operating activity. In regards to forfeitures, the entity may make an entity-wide accounting policy election to either estimate the number of awards that are expected to vest or account for forfeitures when they occur. This ASU is effective for fiscal years beginning after December 15, 2016 including interim periods within that reporting period, however early adoption is permitted. The Company is currently evaluating the guidance to determine the Company's adoption method and the effect it will have on the Company's Consolidated Financial Statements. In January 2016, the FASB issued ASU 2016-01, Financial Instruments-Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities. The amendments in ASU 2016-01, among other things, requires equity investments (except those accounted for under the equity method of accounting, or those that result in consolidation of the investee) to be measured at fair value with changes in fair value recognized in net income; Requires separate presentation of financial assets and financial liabilities by measurement category and form of financial asset (i.e., securities or loans and receivables); Eliminate the requirement to disclose the fair value of financial instruments measured at amortized cost for entities that are not public business entities. The amendments in this ASU are effective for non-public companies for fiscal years beginning after December 15, 2018, and interim periods within fiscal years beginning December 15, 2019. Early adoption of the amendments in the ASU is permitted as early as the fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. The adoption of this standard is not expected to have a material effect on the consolidated financial position and results of operations and statements of cash flows. In August 2014, the FASB issued ASU No. 2014-15 —Presentation of Financial Statements—Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity's Ability to Continue as a Going Concern. The ASU requires management to evaluate whether there are conditions and events that raise substantial doubt about the entity's ability to continue as a going concern within one year after the financial statements are issued and if management's plans will alleviate that doubt. Management will be required to make this evaluation for both annual and interim reporting periods. The Company adopted this guidance for the fiscal year ended December 31, 2016. This adoption did not have a material impact on the Company's consolidated financial statements. In September 2015, the FASB issued Accounting Standards Update (ASU) 2015-16—Business Combinations, as part of its initiative to reduce complexity in accounting standards (the Simplification Initiative). The amendment eliminates the requirement to retrospectively apply adjustments made to provisional amounts recognized in a business combination. The amendment is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2016. Early adoption is permitted. The Company expects to adopt this guidance for the year ended December 31, 2016. The Company does not expect this guidance to have a material effect on its consolidated financial statements. On May 28, 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers, which requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. The ASU will replace most existing revenue recognition guidance in U.S. GAAP when it becomes effective. In August 2015, the FASB issued ASU No. 2015-14, Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date, which delayed the effective date of the new standard from January 1, 2017 to January 1, 2018. The FASB also agreed to allow entities to choose to adopt the standard as of the original effective date. This ASU permits the use of either the retrospective or cumulative effect transition method. The Company is evaluating the effect that ASU 2014-09 will have on our consolidated financial statements and related disclosures. The Company has not yet selected a transition method nor have they determined the effect of the standard on our ongoing financial reporting. Other recent accounting pronouncements issued by the FASB did not or are not believed to have a material impact on our present or future consolidated financial statements.

Note 1-Description of Busines35

Note 1-Description of Business, Basis of Presentation and Summary of Significant Accounting Policies: Fair Value of Financial Instruments: Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis (Tables)	12 Months Ended
	Dec. 31, 2016
Tables/Schedules
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis	Recurring Fair Value Measurements Level 1 Level 2 Level 3 Total LIABILITIES: Derivative liability – December 31, 2016 $ - $ - $ 2,925,627 $ 2,925,627 Derivative liability – December 31, 2015 $ - $ - $ 1,756,435 $ 1,756,435

Note 1-Description of Busines36

Note 1-Description of Business, Basis of Presentation and Summary of Significant Accounting Policies: Basic and Diluted Net Loss Per Common Share: Schedule of Earnings Per Share, Basic and Diluted (Tables)	12 Months Ended
	Dec. 31, 2016
Tables/Schedules
Schedule of Earnings Per Share, Basic and Diluted	Potentially Dilutive Securities December 31, 2016 December 31, 2015 Common stock warrants - 3,355 Convertible notes 32,355,840,300 92,239,381 Preferred series A shares & warrants 23,040,100 86,066,900 Preferred series B 352,000,000 352,000,000 Preferred series C 262,137,500 205,100,000 32,993,017,900 735,409,636

Note 3-Acquisitions_ Schedule o

Note 3-Acquisitions: Schedule of Recognized Identified Assets Acquired and Liabilities Assumed (Tables)	12 Months Ended
	Dec. 31, 2016
Tables/Schedules
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed	ACQUIRED ASSETS : Current assets $ 4,866 Fixed assets 270,811 Other assets 56,985 Total assets acquired $ 332,662 LIABILITIES ASSUMED : Current liabilities $ (11,756 ) Other liabilities (9 ) Total liabilities assumed $ (11,766 ) Net assets acquired $ 320,896 Acquisition Price $ 1,666,667 Intangible Assets from Acquisition $ 1,345,771

Note 4-Fixed Assets_ Property,

Note 4-Fixed Assets: Property, Plant and Equipment (Tables)	12 Months Ended
	Dec. 31, 2016
Tables/Schedules
Property, Plant and Equipment	Fixed Assets Estimated Useful Life (in years) December 31, 2016 December 31, 2015 Cost: Equipment 3-5 $ 643,195 $ 643,195 Furniture and fixture 7 6,687 6,687 Leasehold improvements 3-5 238,620 238,620 Website 3 1,385 1,385 $ 889,887 $ 889,887 Accumulated depreciation and amortization (276,555 ) (140,046 ) Fixed Assets, Net $ 613,332 $ 749,841

Note 8-Convertible Debt_ Conver

Note 8-Convertible Debt: Convertible Debt (Tables)	12 Months Ended
	Dec. 31, 2016
Tables/Schedules
Convertible Debt	Short Term Long Term Total Balance as of January 1, 2015 - Gross $ 1,309,562 $ 812,500 $ 2,122,062 Cash additions 1,263,287 180,000 1,443,287 Interest added to notes payable 331,193 - 331,193 Cash payments (413,000 ) - (413,000 ) Conversions (1,224,163 ) - (1,224,163 ) Original issue discount 76,156 - 76,156 Total $ 1,343,035 $ 992,500 $ 2,335,535 Less: unamortized discount (533,391 ) (794,036 ) (1,327,427 ) Balance as of December 31, 2015 - Net $ 809,644 $ 198,464 $ 1,008,108 Add back: unamortized discount 533,391 794,036 1,327,427 Balance as of December 31, 2015 - Gross $ 1,343,035 $ 992,500 $ 2,335,535 Cash additions 373,460 300,000 673,460 Interest added to notes payable 111,778 116,600 228,378 Cash payments (118,223 ) - (118,223 ) Conversions (474,777 ) - (474,777 ) Reassignments (103,400 ) 103,400 - Original issue discount 47,575 - 47,575 Total $ 1,179,448 $ 1,512,500 $ 2,691,948 Less: unamortized discount (195,827 ) (110,672 ) (306,499 ) Balance as of December 31, 2016 - Net $ 983,621 $ 1,401,828 $ 2,385,449

Note 8-Convertible Debt_ Schedu

Note 8-Convertible Debt: Schedule of Maturities of Long-term Debt (Tables)	12 Months Ended
	Dec. 31, 2016
Tables/Schedules
Schedule of Maturities of Long-term Debt	Year Ended December 31, 2016 2017 2018 2019 2020 2021 Thereafter Total Convertible notes 1,179,448 220,000 - - 1,062,500 230,000 2,691,948 Loans payable 615,801 - - - - - 615,801 Total 1,795,249 220,000 - - 1,062,500 230,000 3,307,749

Note 10-Derivative Liabilities_

Note 10-Derivative Liabilities: Schedule of Derivative Liabilities at Fair Value (Tables)	12 Months Ended
	Dec. 31, 2016
Tables/Schedules
Schedule of Derivative Liabilities at Fair Value	Balance as of January 1, 2015 $ 2,576,025 Initial value derivatives 5,962,270 Extinguished (4,014,734 ) Change in fair value (2,767,126 ) Balance as of December 31, 2015 $ 1,756,435 Initial value derivatives 4,070,636 Extinguished (3,891,703 ) Change in fair value 990,165 Balance as of December 31, 2016 $ 2,925,627

Note 10-Derivative Liabilitie42

Note 10-Derivative Liabilities: Schedule of Assumptions Used (Tables)	12 Months Ended
	Dec. 31, 2016
Tables/Schedules
Schedule of Assumptions Used	2015 2016 Dividend yield: 0 % 0 % Expected volatility 145.0% to 228.0 % 163.0% to 489.2 % Risk free interest rate .03% to 1.63 % .51% to 1.93 % Expected life (years) 0.13 to 4.89 0.09 to 5.05

Note 11-Stockholders' Equity_ S

Note 11-Stockholders' Equity: Schedule of Preferred Units (Tables)	12 Months Ended
	Dec. 31, 2016
Tables/Schedules
Schedule of Preferred Units	Weighted Average Warrants Exercise Price Outstanding – December 31, 2014 1,030,226 $ 2.23 Granted 2,325,000 0.50 Forfeited/canceled (50,000 ) 0.05 Exercised (347,143 ) 0.01 Outstanding – December 31, 2015 2,958,083 $ 1.17 Granted - - Forfeited/canceled (2,958,083 ) 1.17 Exercised - - Outstanding – December 31, 2016 - $ - Exercisable – December 31, 2016 - $ -

Note 11-Stockholders' Equity_44

Note 11-Stockholders' Equity: Schedule of Stockholders' Equity Note, Warrants or Rights (Tables)	12 Months Ended
	Dec. 31, 2016
Tables/Schedules
Schedule of Stockholders' Equity Note, Warrants or Rights	Warrants Weighted Average Exercise Price Outstanding - December 31, 2014 3,930,470 $ 0.05 Granted - - Forfeited/canceled (2,600,000 ) 0.05 Exercised (1,330,740 ) 0.05 Outstanding - December 31, 2015 - $ - Granted - - Forfeited/canceled - - Exercised - - Outstanding – December 31, 2016 - $ - Exercisable – December 31, 2016 - $ -

Note 12-Income Taxes_ Schedule

Note 12-Income Taxes: Schedule of Deferred Tax Assets and Liabilities (Tables)	12 Months Ended
	Dec. 31, 2016
Tables/Schedules
Schedule of Deferred Tax Assets and Liabilities	At December 31, 2016, deferred tax assets consisted of the following: Deferred tax assets Net operating losses $ 4,389,477 Less: valuation allowance (4,389,477) Net deferred tax asset $ - At December 31, 2015, deferred tax assets consisted of the following: Deferred tax assets Net operating losses $ 3,171,007 Less: valuation allowance (3,171,007) Net deferred tax asset $ -

Note 12-Income Taxes_ Schedul46

Note 12-Income Taxes: Schedule of Effective Income Tax Rate Reconciliation (Tables)	12 Months Ended
	Dec. 31, 2016
Tables/Schedules
Schedule of Effective Income Tax Rate Reconciliation	2016 2015 U.S. Federal statutory tax rate 35.0 % 35.0 % State income tax, net of U.S. Federal tax benefit 6.5 % 6.5 % Change in valuation allowance (41.5 %) (41.5 %) Annual tax rate 0.0 % 0.0 %

Note 2-Going Concern (Details)

Note 2-Going Concern (Details) - USD ($)	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015
Details
Net loss	$ 8,795,474	$ 4,478,725
Net cash used in operating activities	928,085	$ 1,928,310
Capital	$ 7,599,588

Note 4-Fixed Assets_ Property48

Note 4-Fixed Assets: Property, Plant and Equipment (Details) - USD ($)	Dec. 31, 2016	Dec. 31, 2015
Details
Accumulated Depreciation, Depletion and Amortization, Property, Plant, and Equipment	$ (276,555)	$ (140,046)
Fixed assets, net	$ 613,332	$ 749,841

Note 5-Intangible Assets and 49

Note 5-Intangible Assets and Goodwill (Details)	Dec. 31, 2015USD ($)
Details
Intangible Assets, Current	$ 307,500
Other Intangible Assets, Net	$ 1,345,771

Note 6-Lines of Credit (Details

Note 6-Lines of Credit (Details) - USD ($)	Dec. 31, 2016	Dec. 31, 2015
Details
Long-term Line of Credit	$ 21,039	$ 19,500

Note 7-Related Party Transact51

Note 7-Related Party Transactions (Details) - USD ($)	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015
Details
Marketing Expense	$ 20,500	$ 46,617
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Vested in Period, Fair Value	1,750	$ 1,750
Management fees - related party	$ 30,515

Note 10-Derivative Liabilities

Note 10-Derivative Liabilities (Details) - USD ($)	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015
Details
Gain/(loss) on derivative liabilities	$ 3,827,703	$ 898,759

Note 11-Stockholders' Equity (D

Note 11-Stockholders' Equity (Details) - USD ($)	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015
Details
Stock-based compensation	$ 79,900	$ 1,297,481

Note 12-Income Taxes (Details)

Note 12-Income Taxes (Details)	Dec. 31, 2016USD ($)
Details
Operating Loss Carryforwards	$ 11,255,000