Greenwood Hall (ELRN) 10-Q 14 Apr 16 2016 Q2 Quarterly report Financial data

Document and Entity Information

Document and Entity Information	6 Months Ended
	Feb. 29, 2016shares
Document And Entity Information
Entity Registrant Name	GREENWOOD HALL, INC.
Entity Central Index Key	1,557,644
Document Type	10-Q
Document Period End Date	Feb. 29, 2016
Trading Symbol	ELRN
Amendment Flag	false
Current Fiscal Year End Date	--08-31
Entity a Well-known Seasoned Issuer	No
Entity a Voluntary Filer	No
Entity's Reporting Status Current	Yes
Entity Filer Category	Smaller Reporting Company
Entity Common Stock, Shares Outstanding	48,824,629
Document Fiscal Year Focus	2,016
Document Fiscal Period Focus	Q2

CONDENSED CONSOLIDATED BALANCE

CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) - USD ($)	Feb. 29, 2016	Aug. 31, 2015
CURRENT ASSETS
Cash and cash equivalents		$ 211,725
Accounts receivable, net	$ 345,216	594,035
Prepaid expenses and other current assets	61,332	125,891
Current assets to be disposed of	36,860	36,860
TOTAL CURRENT ASSETS	443,408	968,511
PROPERTY AND EQUIPMENT, net	110,281	142,872
OTHER ASSETS
Deposits and other assets	74,783	75,034
TOTAL OTHER ASSETS	74,783	75,034
TOTAL ASSETS	628,472	$ 1,186,417
CURRENT LIABILITIES
Bank Overdraft	424,139
Accounts payable	1,823,619	$ 1,332,057
Accrued expenses	684,709	634,780
Accrued payroll and related expenses	479,512	441,279
Deferred revenue	90,126	11,100
Accrued interest	455,543	251,751
Due to shareholders / officer	283,275	169,970
Notes payable, net of discount of $731,113 and $1,364,771, respectively	4,682,302	2,955,240
Line of Credit	2,000,000	2,000,000
Derivative liability	78,172	1,664,993
Current liabilities to be disposed of	335,857	335,857
TOTAL CURRENT LIABILITIES	11,337,254	9,797,027
Notes payable, non-current	37,329	552,329
TOTAL LIABILITIES	$ 11,374,583	$ 10,349,356
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY (DEFICIT)
Common stock, $0.001 par value; 937,500,000 shares authorized, 48,824,629 and 45,114,297 shares issued and outstanding, respectively	$ 48,825	$ 45,115
Subscription Receivable	(190,000)
Additional paid-in capital	14,018,304	$ 9,934,174
Accumulated deficit	(24,623,240)	(19,142,228)
TOTAL STOCKHOLDERS' EQUITY (DEFICIT)	$ (10,746,111)	$ (9,162,939)
Non-controlling interest
TOTAL GREENWOOD HALL, INC. STOCKHOLDERS' EQUITY (DEFICIT)	$ (10,746,111)	$ (9,162,939)
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)	$ 628,472	$ 1,186,417

CONDENSED CONSOLIDATED BALANCE3

CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) (Parenthetical) - USD ($)	Feb. 29, 2016	Aug. 31, 2015
Statement of Financial Position [Abstract]
Notes payable, net of discount	$ 731,113	$ 1,364,771
Common stock, par value per share (dollars per share)	$ 0.001	$ 0.001
Common stock, authorized	937,500,000	937,500,000
Common stock, issued	48,824,629	45,114,297
Common stock, outstanding	48,824,629	45,114,297

CONDENSED CONSOLIDATED STATEMEN

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) - USD ($)	3 Months Ended		6 Months Ended
	Feb. 29, 2016	Feb. 28, 2015	Feb. 29, 2016	Feb. 28, 2015
Income Statement [Abstract]
REVENUES	$ 1,378,168	$ 1,480,420	$ 2,668,169	$ 4,145,388
OPERATING EXPENSES
Direct cost of services	1,127,327	1,162,038	2,184,697	3,009,974
Personnel	761,953	718,225	1,311,972	1,399,766
Selling, general and administrative	640,181	$ 1,371,974	1,626,036	2,048,977
Equity-based expense	438,242		526,426
TOTAL OPERATING EXPENSES	2,967,702	$ 3,252,237	5,649,130	6,458,717
INCOME (LOSS) FROM OPERATIONS	(1,589,534)	(1,771,817)	(2,980,961)	(2,313,329)
OTHER INCOME (EXPENSE)
Interest expense	(636,724)	(202,270)	(2,689,516)	(311,798)
Change in value of derivatives	20,486	(136,870)	222,735	(135,901)
Miscellaneous income (expense), net	(16,482)	(114,088)	(33,270)	(31,861)
TOTAL OTHER INCOME (EXPENSE)	(632,720)	(453,228)	(2,500,051)	(480,529)
INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE PROVISION FOR (BENEFIT FROM) INCOME TAXES	$ (2,222,254)	$ (2,225,045)	$ (5,481,012)	$ (2,793,858)
Provision for (benefit from) income taxes
INCOME (LOSS) FROM CONTINUING OPERATIONS	$ (2,222,254)	$ (2,225,045)	$ (5,481,012)	$ (2,793,858)
INCOME (LOSS) FROM DISCONTINUED OPERATIONS, net of tax
NET INCOME (LOSS)	$ (2,222,254)	$ (2,225,045)	$ (5,481,012)	$ (2,793,858)
Net income (loss) attributable to noncontrolling interests
Earnings per share - basic and diluted
Income (loss) from continuing operations attributable to Greenwood Hall, Inc. common stockholders (in dollars per share)	$ (0.05)	$ (0.06)	$ (0.11)	$ (0.07)
Net income (loss) attributable to Greenwood Hall, Inc. common stockholders (in dollars per share)	$ (0.05)	$ (0.06)	$ (0.11)	$ (0.07)
Weighted average common shares - basic and diluted (in shares)	48,245,471	39,539,228	47,950,973	39,452,196

CONSOLIDATED STATEMENTS OF CASH

CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) - USD ($)	6 Months Ended
	Feb. 29, 2016	Feb. 28, 2015
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)	$ (5,481,012)	$ (2,793,858)
Net income (loss) from discontinued operations
Net income (loss) from continuing operations	$ (5,481,012)	$ (2,793,858)
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities of continuing operations:
Non-cash interest on convertible promissory notes	746,273	40,909
Warrants issued for services	90,017	$ 534,498
Stock-based compensation	98,750
Shares issued for services	427,676
Shares issued for settlement	1,500,000
Depreciation Expense	32,591	$ 31,861
Change in value of derivatives	(222,735)	135,901
Changes in operating assets and liabilities:
Accounts receivable	248,819	546,405
Prepaid expenses and other current assets	64,559	$ 231,461
Deposits and other assets	251
Bank Overdraft	424,139
Accounts payable	491,562	$ 78,605
Accrued expenses	48,390	(4,372)
Accrued payroll and related	38,233	181,294
Deferred revenue	79,026	(778,690)
Accrued interest	203,792	(3,265)
Advances from officers, net	113,305	26,747
Net cash provided by (used in) operating activities of continuing operations	$ (1,096,364)	$ (1,772,504)
Net cash provided by (used in) operating activities of discontinued operations
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES	$ (1,096,364)	$ (1,772,504)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of notes payable	595,000	600,000
Payments on notes payable	(20,361)	$ (384,748)
Proceeds from the sale of stock	$ 310,000
Proceeds from the sale of units		$ 1,238,445
Net cash provided by (used in) financing activities of continuing operations	$ 884,639	$ 1,453,697
Net cash provided by (used in) financing activities of discontinued operations
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES	$ 884,639	$ 1,453,697
NET INCREASE (DECREASE) IN CASH FROM CONTINUING OPERATIONS	$ (211,725)	(318,807)
NET INCREASE (DECREASE) IN CASH FROM DISCONTINUED OPERATIONS
NET INCREASE (DECREASE) IN CASH	$ (211,725)	(318,807)
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD	211,725	367,286
CASH AND CASH EQUIVALENTS, END OF PERIOD		48,479
Supplemental disclosures:
Interest paid in cash	$ 181,340	$ 117,853
Income taxes paid in cash
Supplemental disclosure of non-cash investing and financing activities:
Conversion of convertible note and accrued interest into common stock	$ 80,000

ORGANIZATION AND SUMMARY OF SIG

ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	6 Months Ended
	Feb. 29, 2016
Organization, Consolidation and Presentation of Financial Statements [Abstract]
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	1. ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Organization Greenwood Hall is an education technology company. We provide technology-enabled solutions that enable public and private, not-for-profit colleges and universities to support student learning anywhere. Greenwood Hall does this by providing the services and technology that enable schools to revolutionize how they are able to manage the student lifecycle. Each one of our solutions are designed to help our education partners increase revenue, improve efficiencies, enhance student experience, and improve student outcomes. Since 2006, we have developed and customized turnkey solutions that combine strategy, personnel, proven processes and robust technology to help schools effectively and efficiently improve student outcomes, expand into new markets such as online learning, increase revenues, and deliver enhanced student experiences. Our Company currently has 102 employees and has served more than 50 education clients and over 75 degree programs. Basis of Presentation This report on Form 10-Q for the quarter ended February 29, 2016 should be read in conjunction with the Company's annual report on Form 10-K for the year ended August 31, 2015, filed with the Securities and Exchange Commission (“SEC”) on December 12, 2015. As contemplated by the SEC under Article 8 of Regulation S-X, the accompanying consolidated financial statements and footnotes have been condensed and therefore do not contain all disclosures required by generally accepted accounting principles. The interim financial data are unaudited; however, in the opinion of management, the interim data includes all adjustments, consisting only of normal recurring adjustments, necessary for a fair statement of the results for the interim periods. Results for interim periods are not necessarily indicative of those to be expected for the full year. Reclassifications Certain amounts from prior years have been reclassified to conform to current year presentation. Principles of Consolidation The consolidated financial statements include the accounts of Greenwood Hall, PCS Link, and University Financial Aid Solutions, LLC (“UFAS”), collectively referred to herein as the Company, we, us, our, and Greenwood Hall. All significant intercompany accounts and transactions have been eliminated in consolidation. Through our affiliate UFAS we provided complete financial aid solutions. During 2013, UFAS ceased operations and is presently winding down its affairs. As a result, it is presented in the accompanying consolidated financial statements as discontinued operations. Going Concern The consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“ US GAAP The Company has historically funded its activities through cash generated from operations, debt financing, the issuance of equity for cash, and advances from shareholders. During the six months ended February 29, 2016, the Company received approximately $885,000 in net proceeds from financing activities. Management is in the process of evaluating various financing alternatives in order to finance our growth and general and administrative expenses as well as materially reducing the Company’s debt load. These alternatives include raising funds through public or private equity markets and either through institutional or retail investors. Although there is no assurance that the Company will be successful with our fund raising initiatives, Management believes that the Company will be able to secure the necessary financing as a result of ongoing financing discussions with third party investors and existing shareholders. There can be no assurance that potential financing will be obtained on terms acceptable to management and future financing may substantially dilute the ownership of existing stockholders. Management intends to restore profitability by continuing to grow our operations and customer base while maintaining the overhead savings we achieved during our recent restructuring. Management intends to also restructure the Company’s debt in order to reduce the Company’s debt load. Management believes that the actions presently being taken to further implement its business plan, generate additional revenues, and restructure certain liabilities provide the opportunity for the Company to continue as a going concern. If the Company is not successful in becoming profitable, it may have to further delay or reduce expenses, or curtail operations. The accompanying consolidated financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classification of liabilities that could result should the Company not continue as a going concern. Use of Estimates The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts and disclosures. Management uses its historical records and knowledge of its business in making these estimates. Accordingly, actual results may differ from these estimates. Cash and Cash Equivalents For the purpose of the statement of cash flows, the Company considers cash equivalents to include short-term, highly liquid investments with an original maturity of three months or less. Research and Development Costs relating to designing and developing new products are expensed in the period incurred. Revenue Recognition The Company’s contracts are typically structured into two categories, (i) fixed-fee service contracts that span a period of time, often in excess of one year, and (ii) service contracts at agreed-upon rates based on the volume of service provided or a flat monthly subscription fee. Some of the Company’s service contracts are subject to guaranteed minimum amounts of service volume. The Company recognizes revenue when all of the following have occurred: persuasive evidence of an agreement with the customer exists, services have been rendered, the selling price is fixed or determinable, and collectability of the selling price is reasonably assured. For fixed-fee service contracts, the Company recognizes revenue on a straight-line basis over the period of contract performance. Costs incurred under these service contracts are expensed as incurred. Deferred Revenue Deferred revenue primarily consists of prepayments received from customers for which the Company’s revenue recognition criteria have not been met. The deferred revenue will be recognized as revenue once the criteria for revenue recognition have been met. Accounts Receivable The Company extends credit to its customers. An allowance for doubtful accounts is maintained for estimated losses resulting from the inability of the Company’s customers to make required payments. Management specifically analyzes the age of customer balances, historical bad debt experience, customer credit-worthiness, and changes in customer payment terms when making estimates of the collectability of the Company’s trade accounts receivable balances. If the Company determines that the financial condition of any of its customers has deteriorated, whether due to customer specific or general economic issues, an increase in the allowance may be made. After all attempts to collect a receivable have failed, the receivable is written off. Based on the information available, management believes the Company’s accounts receivable, net of the allowance for doubtful accounts, are collectable. Property and Equipment Property and equipment are stated at cost. Depreciation and amortization are being provided using the straight-line method over the estimated useful lives of the assets. The estimated useful lives used are as follows: Classification Life Equipment 5-7 Years Computer equipment 7 Years Expenses for repairs and maintenance are charged to expense as incurred, while renewals and betterments are capitalized. Income Taxes The Company accounts for income taxes in accordance with ASC 740-10, “Income Taxes” which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements or tax returns. Under this method, deferred income taxes are recognized for the tax consequences in future years of differences between the tax bases of assets and liabilities and their financial reporting amounts at each year-end based on enacted tax laws and statutory tax rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized. Earnings (Loss) per Share Basic earnings (loss) per share is computed using the weighted-average number of common shares outstanding during the period. Diluted earnings (loss) per share are computed using the weighted-average number of common shares and dilutive potential common shares outstanding during the period. Potential dilutive instruments including warrants, stock options, and shares issuable upon conversion of promissory notes, have been excluded from the computation of diluted shares as their effect is anti-dilutive during fiscal 2016 and 2015. Marketing and Advertising Marketing and advertising costs are expensed as incurred. Marketing and advertising amounted to $37,278 and $22,813 for the six months ended February 29, 2016, and the six months ended February 28, 2015, respectively, and are included in selling, general and administrative expenses. Stock-Based Compensation Compensation costs related to stock options and other equity awards are determined in accordance with FASB ASC 718-10, “Compensation-Stock Compensation.” Under this method, compensation cost is calculated based on the grant-date fair value estimated in accordance FASB ASC 718-10, amortized on a straight-line basis over the awards’ vesting period. Stock-based compensation was $98,750 and $0 for the six months ended February 29, 2016 and the six months ended February 28, 2015, respectively. This expense is included in the condensed consolidated statements of operations as Equity-based expense. Derivative Liabilities We account for warrants as either equity or liabilities based upon the characteristics and provisions of each instrument. Warrants classified as equity are recorded as additional paid-in capital on our Consolidated Balance Sheet and no further adjustments to their valuation are made. Some of our warrants were determined to be ineligible for equity classification because of provisions that may result in an adjustment to their exercise price. Warrants classified as derivative liabilities and other derivative financial instruments that require separate accounting as assets or liabilities are recorded on our Consolidated Balance Sheet at their fair value on the date of issuance and are revalued on each subsequent balance sheet date until such instruments are exercised or expire, with any changes in the fair value between reporting periods recorded as other income or expense. We estimate the fair value of these liabilities using option pricing models that are based on the individual characteristics of the warrants or instruments on the valuation date, as well as assumptions for expected volatility, expected life and risk-free interest rate. As part of a debt financing during May 2014, the Company issued warrants to acquire 248,011 shares of Common Stock. These warrants contain a mechanism to increase the number of warrants upon the issuance of certain dilutive equity securities. If during the terms of the warrants, the Company issues additional shares of Common Stock or equivalents, the warrant holders are entitled to additional warrants with the same terms as the original warrants. As a result of these features, the warrants are subject to derivative accounting as prescribed under ASC 815. Accordingly, the fair value of the warrants on the date of issuance was estimated using an option pricing model and recorded on the Company’s Consolidated Balance Sheet as a derivative liability. The fair value of the warrants is estimated at the end of each reporting period and the change in the fair value of the warrants is recorded as a non-operating gain or loss as change in value of derivatives in the Company’s Consolidated Statement of Operations. During 2013, the Company entered into a Loan and Security Agreement with Colgan Financial Group, Inc. (“ CFG CUB Second Amendment Credit Agreement Lenders In December 2014, the Company entered into a Secured Convertible Note with CFG and Robert Logan pursuant to which the Company issued a convertible promissory note of $500,000 and the right to purchase shares upon the payment or conversion of the note principal. The conversion feature and warrants both include provisions that call for the instrument to be converted to equity at a price equal to the lesser of (i) $1.50 per share or (ii) 85% of the weighted average price per share of the Company’s trading price for the 10 trading days prior to conversion / exercise. As a result of this feature, the warrants and conversion feature are subject to derivative accounting pursuant to ASC 815. Accordingly, the fair value of the warrants and conversion feature on the date of issuance was estimated using an option pricing model and recorded on the Company’s Consolidated Balance Sheet as a derivative liability and a note discount. The fair value of the warrants and conversion feature is estimated at the end of each reporting period and the change in the fair value is recorded as a non-operating gain or loss as change in value of derivatives in the Company’s Consolidated Statement of Operations. In March 2015, the Company entered into a Convertible Note with Redwood Fund, LP (“ Redwood In April 2015, the Company entered into a Convertible Note with Lincoln Park Capital Fund, LLP (“ Lincoln Park In August 2015, the Company entered into a Convertible Note with Lincoln Park pursuant to which the Company issued a convertible promissory note of $295,000 accruing interest at 10% and the right to purchase warrants upon the payment or conversion of the note principal. The conversion feature includes provisions that call for the instrument to be converted to equity at a price equal to (i) $1.00 if the Company’s common stock price closes above $1.00; (ii) the average of the publicly reported closing bid and ask price if the Company’s publicly reported common stock price closes between $0.50 and $0.99; or (iii) $0.50 if the Company’s publicly reported common stock price closes below $0.50. As a result of this feature, the conversion feature is subject to derivative accounting pursuant to ASC 815. Accordingly, the fair value of the conversion feature on the date of issuance was estimated using an option pricing model and recorded on the Company’s Consolidated Balance Sheet as a derivative liability and a note discount. The fair value of the conversion feature is estimated at the end of each reporting period and the change in the fair value is recorded as a non-operating gain or loss as change in value of derivatives in the Company’s Consolidated Statement of Operations. In August 2015, the Company entered into a Convertible Note with Redwood pursuant to which the Company issued a convertible promissory note of $588,236 and the right to purchase shares upon the payment or conversion of the note principal. The conversion price (the “ Conversion Price In December 2015, the company entered into a Convertible Note with First Fire Global Opportunities Fund, LLC. pursuant to which the Company issued a promissory note of $275,000 and the right to purchase warrants upon the payment or conversion of the note principal. The conversion feature includes provisions that call for the instrument to be converted to equity at a price equal to $ 0.40 cents per share, subject to adjustment. As a result of this feature, the conversion feature is subject to derivative accounting pursuant to ASC 815. Accordingly, the fair value of the conversion feature on the date of issuance was estimated using an option pricing model and recorded on the Company’s Consolidated Balance Sheet as a derivative liability and a note discount. The fair value of the conversion feature is estimated at the end of each reporting period and the change in the fair value is recorded as a non-operating gain or loss as change in value of derivatives in the Company’s Consolidated Statement of Operations. During the six months ended February 29, 2016 and the six months ended February 28, 2015, the Company recognized a change in value of the derivative liability of $222,735 and $(136,870), respectively. Fair Value of Financial Instruments The Company groups financial assets and financial liabilities measured at fair value into three levels of hierarchy in accordance with ASC 820-10, “Fair Value Measurements and Disclosure.” Assets and liabilities recorded at fair value in the accompanying balance sheet are categorized based upon the level of judgment associated with the inputs used to measure their fair value. Level Input: Input Definition: Level I Observable quoted prices in active markets for identical assets and liabilities. Level II Observable quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-based valuation techniques for which all significant assumptions are observable in the market. Level III Model-based techniques that use at least one significant assumption not observable in the market. These unobservable assumptions reflect estimates of assumptions that market participants would use in pricing the asset or liability. Valuation techniques include use of option pricing models, discounted cash flow models, and similar techniques. For certain of our financial instruments, including working capital instruments, the carrying amounts are approximate fair value due to their short-term nature. Our notes payable approximate fair value based on prevailing interest rates. The following table summarizes fair value measurements at February 29, 2016 and August 31, 2015 for assets and liabilities measured at fair value on a recurring basis. February 29, 2016 Level 1 Level 2 Level 3 Total Derivative Liabilities $ — $ — $ 78,172 $ 78,172 August 31, 2015 Level 1 Level 2 Level 3 Total Derivative Liabilities $ — $ — $ 1,664,993 $1,664,993. The assumptions used in valuing derivative instruments issued during the six months ended February 29, 2016 were as follows: Risk free interest rate 0.51% - 1.22% Expected life .13 Years-5.25 years Dividend yield None Volatility 39% - 113% The following is a reconciliation of the derivative liability related to these instruments for the six months ended February 29, 2016: Value at August 31, 2015 $ 1,664,993 Issuance of instruments 1,313 Change in value (222,735 ) Net settlements (1,365,399 ) Value as of February 29, 2016 $ 78,172 The derivative liabilities are estimated using option pricing models that are based on the individual characteristics of the warrants or instruments on the valuation date, as well as assumptions for expected volatility, expected life and risk-free interest rate. Changes in the assumptions used could have a material impact on the resulting fair value. The primary input affecting the value of our derivatives liabilities is the Company’s stock price, term and volatility. Other inputs have a comparatively insignificant effect. Effect of Recently Issued Accounting Standards In May 2014, FASB issued Accounting Standards Update (ASU) No. 2014-09, Revenue from Contracts with Customers In August 2014, the FASB issued ASU 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 In April 2015, the FASB issued ASU No 2015-3, Simplifying the Presentation of Debt Issuance Costs. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) In March 2016, the FASB issued ASU 2016-09, Improvements to Employee Share-Based Payment Accounting

PROPERTY AND EQUIPMENT

PROPERTY AND EQUIPMENT	6 Months Ended
	Feb. 29, 2016
Property, Plant and Equipment [Abstract]
PROPERTY AND EQUIPMENT	2. PROPERTY AND EQUIPMENT Depreciation and amortization of property and equipment amounted to $32,591 and $31,861 for the six months ended February 29, 2016 and the six months ended February 28, 2015, respectively, and is included in the accompanying consolidated statements of operations in selling, general and administrative expenses. At February 29, 2016 and August 31 2015, property and equipment consists of the following: February August Computer equipment $ 553,255 553,255 Software and Equipment 39,400 39,400 Furniture & Fixtures 9,177 9,177 601,832 601,832 Accumulated depreciation (491,551 ) (458,960 ) Net property and equipment $ 110,281 142,872

NOTES PAYABLE

NOTES PAYABLE	6 Months Ended
	Feb. 29, 2016
Debt Disclosure [Abstract]
NOTES PAYABLE	3. NOTES PAYABLE Opus Bank: On May 28, 2014, the Company entered into a Credit Agreement and related term loan and line of credit with Opus Bank (“ Opus CFG CUB On April 13, 2015, the Company and its lenders executed a second amendment (“ Second Amendment Credit Agreement Lenders As of February 29, 2016, the balance outstanding on the term loan and line of credit amounted to $1,562,280 and $2,058,115, respectively. At February 29, 2016, amounts owed pursuant to the Credit Agreement bear interest at a rate of 8.00% per annum. In connection with the Credit Agreement, the Company issued 248,011 warrants to purchase common stock at an exercise price of $1.00 per share, which increased to 375,000 warrants due to dilutive issuances of equity by the Company during the eight months ended August 31, 2014. The warrants are exercisable immediately. In the event of future dilutive issuances, the number of warrants issuable shall be increased based on a specified formula. The warrants were valued at $78,281 on the date of issuance, which was recorded as a note discount. During the six months ended February 29, 2016, the Company recognized $13,000 of amortization related to this discount, leaving a balance of $32,617 at February 29, 2016. On September 24, 2015, PCS Link, Inc. dba Greenwood & Hall (“ PCS Link Opus Opus Amendment Opus Credit Agreement · Opus waived all prior covenant defaults. · Opus shall have no obligation to advance any further credit to PCS Link, either by way of overdraft coverage or advances on any loans currently outstanding. · The maturity date (“ Maturity Date · By October 2, 2015, PCS Link will issue equity and/or unsecured debt resulting in aggregate gross proceeds not less than $1,250,000. · PCS Link shall have no further obligation to comply with the financial covenants. · PCS Link shall not be required to make any principal payments until the Maturity Date. All accrued principal, along with all accrued and unpaid interest, shall be due and payable in full on the Maturity Date. · The outstanding balance of PCS Link shall accrue interest at the rate of 8% per annum beginning on August 1, 2015. PCS Link shall make such interest payments on a monthly basis commencing as of September 1, 2015. · Opus will receive 1,200,000 warrants for shares of common stock at an exercise price of $1.00 per share, not to include anti-dilution or cashless exercise provision. Opus’s existing warrant with an issue date of July 18, 2014 shall be surrendered upon issuance of the 1,200,000 warrants. As of February 29, 2016, the balance outstanding on the term loan and line of credit amounted to $1,561,944 and $2,057,670, respectively. On April 13, 2016, Opus and the Company agreed to extend the Maturity Date to May 6, 2016. California United Bank: In October 2010, the Company issued a promissory note to California United Bank (“ CUB On May 22, 2014, the Company and CUB amended the promissory note of $1,250,000 to extend the maturity date to the earlier of i) October 31, 2014 or ii) the completion of specified debt / equity funding. CUB also agreed to subordinate its security interest to another lender if certain criteria were met. In December 2014, the Company entered into a Change in Terms Agreement with CUB which included an extension of the maturity date of the facility to April 30, 2015 and an adjustment of the interest rate to five percent (5%) in excess of the Prime Rate. On April 13, 2015, the Company and its lenders executed a second amendment (“ Second Amendment Credit Agreement Lenders In conjunction with the Opus Amendment dated September 24, 2015, the following terms were agreed to with California United Bank: · CUB will provide the Company a forbearance period beginning September 1, 2015 and continuing through April 15,2016 (the “ Forbearance Period · CUB will receive during the Forbearance Period monthly interest payments of interest in full for the period starting September 1, 2015. · CUB shall be paid deferred interest due upon the Company raising $2,000,000 in working capital, but only if the Company has satisfied its obligations in accordance with Company’s prepared cash projections. · CUB will receive a full payoff of all its outstanding principal, interest (including accrued and unpaid interest as of the date of this letter), fees, and expenses (including, but not limited to, CUB’s outside counsel legal fees and costs) by April 15, 2016 or at the successful consummation of any public offering, strategic private investments, or take private scenario, whichever occurs first. · CUB will receive 523,587 warrants for shares of common stock at an exercise price of $1.00 per share, not to include anti-dilution or cash-less exercise provision. As of February 29, 2016, the CUB balance remaining is $912,706. On April 14, 2016, CUB and the Company agreed to extend the Maturity Date to May 6, 2016. Colgan Financial Group, Inc.: In December 2014, in consideration for funds in the amount of $500,000 received by Greenwood Hall, Inc. from Colgan Financial Group, Inc. (“ CFG Logan Holder On April 13, 2015, the Company and its lenders executed a second amendment (“ Second Amendment Credit Agreement Lenders In connection with this debt, the Company issued the right to purchase warrants upon the payment or conversion of the note principal. The conversion feature and warrants both include provisions that call for the instrument to be converted to equity at a price equal to the lesser of i) $1.50 per share or ii) 85% of the weighted average price per share of the Company’s trading price for the ten (10) trading days prior to conversion / exercise. As a result of this feature, the warrants and conversion feature are subject to derivative accounting pursuant to ASC 815. Accordingly, the fair value of the warrants and conversion feature on the date of issuance was estimated using an option pricing model and recorded on the Company’s Consolidated Balance Sheet as a derivative liability and a note discount. The fair value of the discount on the issuance date was estimated at approximately $323,000 and is being amortized over the term of the note using the effective interest method. Amortization of the note discount during the six months ended February 29, 2016 amounted to approximately $137,000. During 2013, the Company entered into a Loan and Security Agreement with CFG pursuant to which the Company issued a promissory note of $600,000. The note bears interest at 2.5% per month, is payable in monthly installments of principal and interest through June 2014, is guaranteed by one shareholder of the Company and an advisor to the Company and is secured by substantially all assets of the Company. This note is subordinate to the notes held by CUB. In July 2014, a payment of $144,000 was made in connection with an equity funding. In April 2015, the Company received an additional $200,000 in funding under this agreement. On April 13, 2015, the Company and its lenders executed a second amendment (“ Second Amendment Credit Agreement Lenders th On April 14, 2016, CFG and the Company agreed to extend the Maturity Date to May 6, 2016. Redwood Fund, LP: On or about March 31, 2015, the Company entered into a Convertible Note with Redwood Fund, LP (“ Redwood On August 14, 2015, the Company entered into a one-year $588,236 Convertible Note with Redwood. In conjunction with this note, the Company issued Redwood warrants that are exercisable for 295,000 shares of the Company’s common stock over the next five (5) years at an exercise price of $1.00 per share. Redwood has an option to provide additional convertible debt to the Company in the amount of $250,000 at the same terms. Interest will accrue monthly at 10% annually and the note is unsecured. In connection with this debt, the Company recorded a note discount equal to $588,236 associated with the measurement of the warrants and conversion issued therewith. In addition to this note and the Warrant, at the Closing, the Company issued 200,000 shares of common stock to Redwood, which were measured at the closing price on the date of issuance. The aggregate value of the shares, warrants and conversion feature exceeded the face value of the note. As a result, the Company recognized a charge to interest expense in the amount of $1,165,202 on the date of issuance related to such excess value. During the six months ended February 29, 2016, the Company recognized approximately $294,000 of amortization of note discount. On November 6, 2015, the Company entered into a six month $125,000 Promissory note with Redwood with an original issue discount of 20% or $25,000. Interest will accrue monthly at 10% annually and the note is unsecured. During the six months ended February 29, 2016, the Company recognized approximately $15,833 of amortization of note discount and $3938 accrued interest. On December 14, 2015, the Company entered into a short-term $30,000 Promissory note with Redwood with an additional $15,000 added January 18, 2016. Interest will accrue monthly at 18% annually and the note is unsecured. During the six months ended February 29, 2016, the Company recognized approximately $1,000 of accrued interest On February 4, 2016, the Company entered into a one year $235,294 Promissory note with Redwood with an original issue discount of 15% or $35,294. Interest will accrue monthly at 10% annually and the note is unsecured. During the six months ended February 29, 2016, the Company recognized approximately $2,000 of amortization of note discount and $2,000 of accrued interest. The Company’s Chairman and CEO guaranteed the February 4, 2016 note. Lincoln Park Capital Fund, LLP: In April 2015, the Company entered into a Convertible Note with Lincoln Park Capital Fund, LLP (“ Lincoln Park On August 21, 2015, the Company entered into a one-year $295,000 Convertible Note with Lincoln Park. In conjunction with this note, the Company issued Lincoln Park warrants that are exercisable for 400,000 shares of the Company’s common stock over the next five (5) years at an exercise price of $1.00 per share. Interest will accrue monthly at 10% annually and the note is unsecured. In connection with this debt, the Company recorded a note discount equal to approximately $247,000 associated with the measurement of the warrants and conversion issued therewith. During the six months ended February 29, 2016, the Company recognized approximately $123,000 of amortization of note discount. FirstFire Global Opportunities Fund, LLC: In December 2015, the Company entered into a Convertible Note with FirstFire Global Opportunities Fund, LLC (“ FirstFire Promissory Note The Company also finances the purchases of small equipment. The amount of such notes is not significant at February 29, 2016. The following is a schedule, by year, of future minimum principal payments required under notes payable as of February 29, 2016: Years Ending 2016 $ 7,413,415 2017 $ 37,329 2018 2019 — Total 7,450,744 Note discount (731,113 ) $ 6,719,631

RELATED PARTY TRANSACTIONS

RELATED PARTY TRANSACTIONS	6 Months Ended
	Feb. 29, 2016
Related Party Transactions [Abstract]
RELATED PARTY TRANSACTIONS	4. RELATED PARTY TRANSACTIONS One of the Company’s customers, MarkeTouch Media, Inc. (“ MarkeTouch

STOCKHOLDERS' EQUITY

STOCKHOLDERS' EQUITY	6 Months Ended
	Feb. 29, 2016
Stockholders' Equity Note [Abstract]
STOCKHOLDERS' EQUITY	5. STOCKHOLDERS’ EQUITY The Company is authorized to issue one class of stock, which represents 937,500,000 shares of common stock, par value $0.001. Common Stock Pursuant to an agreement between the Company and MarkeTouch, the Company is repurchasing the shares held by MarkeTouch. This agreement was settled per an agreement dated June 9, 2015. MarkeTouch relinquished all equity and ownership rights in exchange for service credits up to $174,000 to be used over a designated period with certain monthly limits. On September 16, 2015, pursuant to the termination of a registration rights agreement between the Company, Rogers, and Byrne United S.A. ("Byrne"), the Company agreed to issue 625,000 shares of Common Stock to Rogers and 625,000 shares of Common Stock o Byrne. The Company recognized an interest expense of $ 1,500,000 associated with this issuance. On September 24, 2015, CFG converted $ 80,000 in debt at a price of $ 0.10 per share of Common Stock, pursuant to the Opus Third Amendment. This resulted in a interest expense of $1,365,391 for the derivative. Stock Issued for Services During the six months ended February 29, 2016, the Company entered into consulting agreements with multiple vendors for advisory and consulting services. The company issued and granted to Ignite Capital 250,000 shares valued at $290,000. The company issued to Uptick Capital 410,332 shares valued at $97,676 and also issued to EMC, LLC 500,000 shares valued at $40,000. Stock Option Plan In July 2014, the Board of Directors adopted, and the shareholders approved, the 2014 Stock Option Plan under which a total of 5,000,000 shares of common stock had been reserved for issuance. The 2014 Stock Option Plan will terminate in September 2024. Stock Options Transactions in 1H 2016 Quantity Weighted- Weighted- Outstanding, August 31, 2015 1,750,000 $ 0.37 9.29 Granted 2,585,000 $ 0.18 10.00 Exercised 0 0 Cancelled/Forfeited 0 0 Outstanding, February 29, 2016 4,335,000 $ 0.25 9.45 Exercisable, February 29, 2016 1,750,000 $ 0.37 8.79 The fair value of these options was estimated at the date of grant using the Black Scholes option pricing model with the following assumptions: no dividends, expected volatility of 30% to 100 %, risk free interest rate between 1.21% and 2.72%, and expected life of 5.5 years. The weighted average remaining contractual life of options outstanding issued under the Plan was 9.45 years at February 29, 2016. The exercise prices for the options outstanding at February 29, 2016 ranged from $0.01 to $0.75, and the information relating to these options is as follows: OPTIONS OUTSTANDING OPTIONS EXERCISABLE Quantity Weighted- Weighted- Quantity Weighted- Weighted- 700,000 $ 0.01 8.40 700,000 0.01 8.40 600,000 $ 0.50 9.03 600,000 0.50 9.03 450,000 $ 0.75 9.09 450,000 0.75 9.09 910,000 $ 0.35 9.69 1,675,000 $ 0.08 9.99 4,335,000 $ 0.25 9.45 1,750,000 $ 0.37 8.79 Warrants Outstanding The following is a summary of warrants outstanding at February 29, 2016: Exercise Price Number of Expiration Date $ 1.00 1,264,023 Nov 2024 $ 0.01 100,000 Jul 2016 $ 1.00 295,000 Apr 2020 $ 1.00 400,000 Aug 2020 $ 0.50 1,176,473 Aug 2020 $ 0.01 250,000 Dec 2020 $ 1.00 1,200,000 Aug 2021 $ 1.00 523,587 Aug 2021 $ 1.00 20,000 Aug 2021 $ 1.00 10,000 Aug 2021 $ 0.01 150,000 Feb 2018 Warrants were issued for consulting agreements or amendments to financing terms. They are booked to additional paid in capital and to interest expense based on stock price at date of grant, exercise price, warrant life, risk free rate and annual volatility. During the six months ended February 29, 2016, the Company granted 2,153,587 warrants valued at $116,002.

CONCENTRATIONS

CONCENTRATIONS	6 Months Ended
	Feb. 29, 2016
Risks and Uncertainties [Abstract]
CONCENTRATIONS	6. CONCENTRATIONS Concentration of Credit Risk The Company maintains its cash and cash equivalents at a financial institution which may, at times, exceed federally insured limits. Historically, the Company has not experienced any losses in such accounts. Major Customers For the six months ended February 29, 2016, four (4) customers represented 52% of net revenues and for the six months ended February 28, 2015 one (1) customer and two (2) of their projects represented 44% of net revenues, respectively. A decision by this customer to cease business relations with the Company may have a material adverse effect on the Company’s financial condition and results of operations.

INCOME TAXES

INCOME TAXES	6 Months Ended
	Feb. 29, 2016
Income Tax Disclosure [Abstract]
INCOME TAXES	7. INCOME TAXES The difference between income tax expense attributable to continuing operations and the amount of income tax expense that would result from applying domestic federal statutory rates to pre-tax income (loss) is mainly related to an increase in the valuation allowance, partially offset by state income taxes. Valuation allowances are established, when necessary, to reduce deferred income tax assets to the amount expected to be realized. Deferred income tax assets are mainly related to net operating loss carryforwards. Management has chosen to take a 100% valuation allowance against the deferred income tax asset until such time as management believes that its projections of future profits make the realization of the deferred income tax assets more likely than not. Significant judgment is required in the evaluation of deferred income tax benefits and differences in future results from management’s estimates could result in material differences. A majority of the Company’s deferred tax asset is comprised of net operating loss carryforwards, offset by a 100% valuation allowance at February 29, 2016. As of February 29, 2016, the Company is in process of determining the amount of Federal and State net operating loss carry forwards (“ NOL Due to the existence of the valuation allowance, future changes in the Company’s unrecognized tax benefits will not impact its effective tax rate. Any carryforwards that expire prior to utilization as a result of such limitations will be removed, if applicable, from deferred tax assets with a corresponding reduction of the valuation allowance.

COMMITMENTS AND CONTINGENCIES

COMMITMENTS AND CONTINGENCIES	6 Months Ended
	Feb. 29, 2016
Commitments and Contingencies Disclosure [Abstract]
COMMITMENTS AND CONTINGENCIES	8. COMMITMENTS AND CONTINGENCIES Lease Commitments The Company leases its operating facilities under non-cancelable operating leases that expire through 2024. Total rent expense for the six months ended February 29, 2016, the six months ended February 28, 2015, amounted to $363,164 and $225,121, respectively. The Company is responsible for certain operating expenses in connection with these leases. The following is a schedule, by year, of future minimum lease payments required under non-cancelable operating leases as of February 29, 2016: Years Ending 2016 (remaining) $ 313,659 2017 676,425 2018 694,857 2019 713,753 2020 716,767 Thereafter 1,642,397 $ 4,757,858 Employment Agreements At February 29, 2016, the Company maintained an employment agreement with an officer, the terms of which may require the payment of severance benefits upon termination. Legal Matters The Company is involved from time to time in various legal proceedings in the normal conduct of its business. The Company is the subject of pending litigation, which could cause it to incur significant costs in defending such litigation or in resulting actions or judgments. The Robin Hood Foundation (“ Robin Hood Patriot Hall The Company is the subject of pending litigation, which could cause it to incur significant costs in defending such litigation or in resulting actions or judgments. Finance 500, Inc. filed suit against the Company, in the Superior Court of the State of California for the County of Orange (Central Justice) for breach of contract and unjust enrichment, among other things, in the amount of not less than $ 250,000. We believe that we have strong defenses and we are vigorously defending against this lawsuit, but the potential range of loss related to this matter cannot be determined, as the pleadings are still not resolved, and will not resolved anytime in the near future. If we fail in defending any such claims or settling those claims, in addition to paying monetary damages or a settlement payment, the outcome of this matter could have a materially adverse effect on our business, financial condition and results of operations. The Company is the subject of pending litigation, which could cause it to incur significant costs in defending such litigation or in resulting actions or judgments. StoryCorp Consulting, Inc. and David R. Wells filed suit against the Company and the Company’s CEO, John R. Hall, in his individual capacity, on March 11, 2016, in the Superior Court of the State of California for the County of Los Angeles (Central District) for breach of contract and promissory fraud/false promise, among other things, in the amount of not less than $ 100,000. We believe that we have strong defenses and we are vigorously defending against this lawsuit, but the potential range of loss related to this matter cannot be determined, as the pleadings are still not resolved, and will not resolved until 2017 at the earliest. No trial date has been set. If we fail in defending any such claims or settling those claims, in addition to paying monetary damages or a settlement payment, the outcome of this matter could have a materially adverse effect on our business, financial condition and results of operations.

DISCONTINUED OPERATIONS

DISCONTINUED OPERATIONS	6 Months Ended
	Feb. 29, 2016
Discontinued Operations and Disposal Groups [Abstract]
DISCONTINUED OPERATIONS	9. DISCONTINUED OPERATIONS During 2013, we ceased operations in our affiliated company, UFAS. The operations of UFAS are now presented as discontinued operations in the accompanying consolidated financial statements. UFAS has been since inactive since 2013. During the six months ending February 29, 2016 and six months ending February 28, 2015 there was no activity. There are current assets to be disposed of approximately $37,000 and current liabilities to be disposed of approximately $336,000 as of February 29, 2016 and August 31, 2015.

SUBSEQUENT EVENTS

SUBSEQUENT EVENTS	6 Months Ended
	Feb. 29, 2016
Subsequent Events [Abstract]
SUBSEQUENT EVENTS	10. SUBSEQUENT EVENTS On April 13, 2016, Opus Bank and the Company agreed to extend the Maturity Date of their Promissory Note to May 6, 2016. On April 14, 2016, California United Bank and Colgan Financial Group agreed to extend the Maturity Date of their respective Promissory Notes to May 6, 2016.

ORGANIZATION AND SUMMARY OF S16

ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)	6 Months Ended
	Feb. 29, 2016
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Organization	Organization Greenwood Hall is an education technology company. We provide technology-enabled solutions that enable public and private, not-for-profit colleges and universities to support student learning anywhere. Greenwood Hall does this by providing the services and technology that enable schools to revolutionize how they are able to manage the student lifecycle. Each one of our solutions are designed to help our education partners increase revenue, improve efficiencies, enhance student experience, and improve student outcomes. Since 2006, we have developed and customized turnkey solutions that combine strategy, personnel, proven processes and robust technology to help schools effectively and efficiently improve student outcomes, expand into new markets such as online learning, increase revenues, and deliver enhanced student experiences. Our Company currently has 102 employees and has served more than 50 education clients and over 75 degree programs.
Basis of Presentation	Basis of Presentation This report on Form 10-Q for the quarter ended February 29, 2016 should be read in conjunction with the Company's annual report on Form 10-K for the year ended August 31, 2015, filed with the Securities and Exchange Commission (“SEC”) on December 12, 2015. As contemplated by the SEC under Article 8 of Regulation S-X, the accompanying consolidated financial statements and footnotes have been condensed and therefore do not contain all disclosures required by generally accepted accounting principles. The interim financial data are unaudited; however, in the opinion of management, the interim data includes all adjustments, consisting only of normal recurring adjustments, necessary for a fair statement of the results for the interim periods. Results for interim periods are not necessarily indicative of those to be expected for the full year.
Reclassifications	Reclassifications Certain amounts from prior years have been reclassified to conform to current year presentation.
Principles of Consolidation	Principles of Consolidation The consolidated financial statements include the accounts of Greenwood Hall, PCS Link, and University Financial Aid Solutions, LLC (“UFAS”), collectively referred to herein as the Company, we, us, our, and Greenwood Hall. All significant intercompany accounts and transactions have been eliminated in consolidation. Through our affiliate UFAS we provided complete financial aid solutions. During 2013, UFAS ceased operations and is presently winding down its affairs. As a result, it is presented in the accompanying consolidated financial statements as discontinued operations.
Going Concern	Going Concern The consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“ US GAAP The Company has historically funded its activities through cash generated from operations, debt financing, the issuance of equity for cash, and advances from shareholders. During the six months ended February 29, 2016, the Company received approximately $885,000 in net proceeds from financing activities. Management is in the process of evaluating various financing alternatives in order to finance our growth and general and administrative expenses as well as materially reducing the Company’s debt load. These alternatives include raising funds through public or private equity markets and either through institutional or retail investors. Although there is no assurance that the Company will be successful with our fund raising initiatives, Management believes that the Company will be able to secure the necessary financing as a result of ongoing financing discussions with third party investors and existing shareholders. There can be no assurance that potential financing will be obtained on terms acceptable to management and future financing may substantially dilute the ownership of existing stockholders. Management intends to restore profitability by continuing to grow our operations and customer base while maintaining the overhead savings we achieved during our recent restructuring. Management intends to also restructure the Company’s debt in order to reduce the Company’s debt load. Management believes that the actions presently being taken to further implement its business plan, generate additional revenues, and restructure certain liabilities provide the opportunity for the Company to continue as a going concern. If the Company is not successful in becoming profitable, it may have to further delay or reduce expenses, or curtail operations. The accompanying consolidated financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classification of liabilities that could result should the Company not continue as a going concern.
Use of Estimates	Use of Estimates The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts and disclosures. Management uses its historical records and knowledge of its business in making these estimates. Accordingly, actual results may differ from these estimates.
Cash and Cash Equivalents	Cash and Cash Equivalents For the purpose of the statement of cash flows, the Company considers cash equivalents to include short-term, highly liquid investments with an original maturity of three months or less.
Research and Development	Research and Development Costs relating to designing and developing new products are expensed in the period incurred.
Revenue Recognition	Revenue Recognition The Company’s contracts are typically structured into two categories, (i) fixed-fee service contracts that span a period of time, often in excess of one year, and (ii) service contracts at agreed-upon rates based on the volume of service provided or a flat monthly subscription fee. Some of the Company’s service contracts are subject to guaranteed minimum amounts of service volume. The Company recognizes revenue when all of the following have occurred: persuasive evidence of an agreement with the customer exists, services have been rendered, the selling price is fixed or determinable, and collectability of the selling price is reasonably assured. For fixed-fee service contracts, the Company recognizes revenue on a straight-line basis over the period of contract performance. Costs incurred under these service contracts are expensed as incurred.
Deferred Revenue	Deferred Revenue Deferred revenue primarily consists of prepayments received from customers for which the Company’s revenue recognition criteria have not been met. The deferred revenue will be recognized as revenue once the criteria for revenue recognition have been met.
Accounts Receivable	Accounts Receivable The Company extends credit to its customers. An allowance for doubtful accounts is maintained for estimated losses resulting from the inability of the Company’s customers to make required payments. Management specifically analyzes the age of customer balances, historical bad debt experience, customer credit-worthiness, and changes in customer payment terms when making estimates of the collectability of the Company’s trade accounts receivable balances. If the Company determines that the financial condition of any of its customers has deteriorated, whether due to customer specific or general economic issues, an increase in the allowance may be made. After all attempts to collect a receivable have failed, the receivable is written off. Based on the information available, management believes the Company’s accounts receivable, net of the allowance for doubtful accounts, are collectable.
Property and Equipment	Property and Equipment Property and equipment are stated at cost. Depreciation and amortization are being provided using the straight-line method over the estimated useful lives of the assets. The estimated useful lives used are as follows: Classification Life Equipment 5-7 Years Computer equipment 7 Years Expenses for repairs and maintenance are charged to expense as incurred, while renewals and betterments are capitalized.
Income Taxes	Income Taxes The Company accounts for income taxes in accordance with ASC 740-10, “Income Taxes” which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements or tax returns. Under this method, deferred income taxes are recognized for the tax consequences in future years of differences between the tax bases of assets and liabilities and their financial reporting amounts at each year-end based on enacted tax laws and statutory tax rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized.
Earnings (Loss) per Share	Earnings (Loss) per Share Basic earnings (loss) per share is computed using the weighted-average number of common shares outstanding during the period. Diluted earnings (loss) per share are computed using the weighted-average number of common shares and dilutive potential common shares outstanding during the period. Potential dilutive instruments including warrants, stock options, and shares issuable upon conversion of promissory notes, have been excluded from the computation of diluted shares as their effect is anti-dilutive during fiscal 2016 and 2015.
Marketing and Advertising	Marketing and Advertising Marketing and advertising costs are expensed as incurred. Marketing and advertising amounted to $37,278 and $22,813 for the six months ended February 29, 2016, and the six months ended February 28, 2015, respectively, and are included in selling, general and administrative expenses.
Stock-Based Compensation	Stock-Based Compensation Compensation costs related to stock options and other equity awards are determined in accordance with FASB ASC 718-10, “Compensation-Stock Compensation.” Under this method, compensation cost is calculated based on the grant-date fair value estimated in accordance FASB ASC 718-10, amortized on a straight-line basis over the awards’ vesting period. Stock-based compensation was $98,750 and $0 for the six months ended February 29, 2016 and the six months ended February 28, 2015, respectively. This expense is included in the condensed consolidated statements of operations as Equity-based expense.
Derivative Liabilities	Derivative Liabilities We account for warrants as either equity or liabilities based upon the characteristics and provisions of each instrument. Warrants classified as equity are recorded as additional paid-in capital on our Consolidated Balance Sheet and no further adjustments to their valuation are made. Some of our warrants were determined to be ineligible for equity classification because of provisions that may result in an adjustment to their exercise price. Warrants classified as derivative liabilities and other derivative financial instruments that require separate accounting as assets or liabilities are recorded on our Consolidated Balance Sheet at their fair value on the date of issuance and are revalued on each subsequent balance sheet date until such instruments are exercised or expire, with any changes in the fair value between reporting periods recorded as other income or expense. We estimate the fair value of these liabilities using option pricing models that are based on the individual characteristics of the warrants or instruments on the valuation date, as well as assumptions for expected volatility, expected life and risk-free interest rate. As part of a debt financing during May 2014, the Company issued warrants to acquire 248,011 shares of Common Stock. These warrants contain a mechanism to increase the number of warrants upon the issuance of certain dilutive equity securities. If during the terms of the warrants, the Company issues additional shares of Common Stock or equivalents, the warrant holders are entitled to additional warrants with the same terms as the original warrants. As a result of these features, the warrants are subject to derivative accounting as prescribed under ASC 815. Accordingly, the fair value of the warrants on the date of issuance was estimated using an option pricing model and recorded on the Company’s Consolidated Balance Sheet as a derivative liability. The fair value of the warrants is estimated at the end of each reporting period and the change in the fair value of the warrants is recorded as a non-operating gain or loss as change in value of derivatives in the Company’s Consolidated Statement of Operations. During 2013, the Company entered into a Loan and Security Agreement with Colgan Financial Group, Inc. (“ CFG CUB Second Amendment Credit Agreement Lenders In December 2014, the Company entered into a Secured Convertible Note with CFG and Robert Logan pursuant to which the Company issued a convertible promissory note of $500,000 and the right to purchase shares upon the payment or conversion of the note principal. The conversion feature and warrants both include provisions that call for the instrument to be converted to equity at a price equal to the lesser of (i) $1.50 per share or (ii) 85% of the weighted average price per share of the Company’s trading price for the 10 trading days prior to conversion / exercise. As a result of this feature, the warrants and conversion feature are subject to derivative accounting pursuant to ASC 815. Accordingly, the fair value of the warrants and conversion feature on the date of issuance was estimated using an option pricing model and recorded on the Company’s Consolidated Balance Sheet as a derivative liability and a note discount. The fair value of the warrants and conversion feature is estimated at the end of each reporting period and the change in the fair value is recorded as a non-operating gain or loss as change in value of derivatives in the Company’s Consolidated Statement of Operations. In March 2015, the Company entered into a Convertible Note with Redwood Fund, LP (“ Redwood In April 2015, the Company entered into a Convertible Note with Lincoln Park Capital Fund, LLP (“ Lincoln Park In August 2015, the Company entered into a Convertible Note with Lincoln Park pursuant to which the Company issued a convertible promissory note of $295,000 and the right to purchase warrants upon the payment or conversion of the note principal. The conversion feature includes provisions that call for the instrument to be converted to equity at a price equal to (i) $1.00 if the Company’s common stock price closes above $1.00; (ii) the average of the publicly reported closing bid and ask price if the Company’s publicly reported common stock price closes between $0.50 and $0.99; or (iii) $0.50 if the Company’s publicly reported common stock price closes below $0.50. As a result of this feature, the conversion feature is subject to derivative accounting pursuant to ASC 815. Accordingly, the fair value of the conversion feature on the date of issuance was estimated using an option pricing model and recorded on the Company’s Consolidated Balance Sheet as a derivative liability and a note discount. The fair value of the conversion feature is estimated at the end of each reporting period and the change in the fair value is recorded as a non-operating gain or loss as change in value of derivatives in the Company’s Consolidated Statement of Operations. In August 2015, the Company entered into a Convertible Note with Redwood pursuant to which the Company issued a convertible promissory note of $588,236 and the right to purchase shares upon the payment or conversion of the note principal. The conversion price (the “ Conversion Price In December 2015, the company entered into a Convertible Note with First Fire Global Opportunities Fund, LLC. pursuant to which the Company issued a promissory note of $275,000 and the right to purchase warrants upon the payment or conversion of the note principal. The conversion feature includes provisions that call for the instrument to be converted to equity at a price equal to $ 0.40 cents per share, subject to adjustment. As a result of this feature, the conversion feature is subject to derivative accounting pursuant to ASC 815. Accordingly, the fair value of the conversion feature on the date of issuance was estimated using an option pricing model and recorded on the Company’s Consolidated Balance Sheet as a derivative liability and a note discount. The fair value of the conversion feature is estimated at the end of each reporting period and the change in the fair value is recorded as a non-operating gain or loss as change in value of derivatives in the Company’s Consolidated Statement of Operations. During the six months ended February 29, 2016 and the six months ended February 28, 2015, the Company recognized a change in value of the derivative liability of $222,735 and $(136,870), respectively.
Fair Value of Financial Instruments	Fair Value of Financial Instruments The Company groups financial assets and financial liabilities measured at fair value into three levels of hierarchy in accordance with ASC 820-10, “Fair Value Measurements and Disclosure.” Assets and liabilities recorded at fair value in the accompanying balance sheet are categorized based upon the level of judgment associated with the inputs used to measure their fair value. Level Input: Input Definition: Level I Observable quoted prices in active markets for identical assets and liabilities. Level II Observable quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-based valuation techniques for which all significant assumptions are observable in the market. Level III Model-based techniques that use at least one significant assumption not observable in the market. These unobservable assumptions reflect estimates of assumptions that market participants would use in pricing the asset or liability. Valuation techniques include use of option pricing models, discounted cash flow models, and similar techniques. For certain of our financial instruments, including working capital instruments, the carrying amounts are approximate fair value due to their short-term nature. Our notes payable approximate fair value based on prevailing interest rates. The following table summarizes fair value measurements at February 29, 2016 and 2014 for assets and liabilities measured at fair value on a recurring basis. February 29, 2016 Level 1 Level 2 Level 3 Total Derivative Liabilities $ — $ — $ 78,172 $ 78,172 August 31, 2015 Level 1 Level 2 Level 3 Total Derivative Liabilities $ — $ — $ 1,664,993 $1,664,993. The assumptions used in valuing derivative instruments issued during the six months ended February 29, 2016 were as follows: Risk free interest rate 0.51% - 1.22% Expected life .13 Years-5.25 years Dividend yield None Volatility 39% - 113% The following is a reconciliation of the derivative liability related to these instruments for the six months ended February 29, 2016: Value at August 31, 2015 $ 1,664,993 Issuance of instruments 1,313 Change in value (222,735 ) Net settlements (1,365,399 ) Value as of February 29, 2016 $ 78,172 The derivative liabilities are estimated using option pricing models that are based on the individual characteristics of the warrants or instruments on the valuation date, as well as assumptions for expected volatility, expected life and risk-free interest rate. Changes in the assumptions used could have a material impact on the resulting fair value. The primary input affecting the value of our derivatives liabilities is the Company’s stock price, term and volatility. Other inputs have a comparatively insignificant effect.
Effect of Recently Issued Accounting Standards	Effect of Recently Issued Accounting Standards In May 2014, FASB issued Accounting Standards Update (ASU) No. 2014-09, Revenue from Contracts with Customers In August 2014, the FASB issued ASU 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 In April 2015, the FASB issued ASU No 2015-3, Simplifying the Presentation of Debt Issuance Costs. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) In March 2016, the FASB issued ASU 2016-09, Improvements to Employee Share-Based Payment Accounting

ORGANIZATION AND SUMMARY OF S17

ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)	6 Months Ended
	Feb. 29, 2016
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Schedule of estimated useful lives of property and equipment	The estimated useful lives used are as follows: Classification Life Equipment 5-7 Years Computer equipment 7 Years
Schedule of fair value measurements	The following table summarizes fair value measurements at February 29, 2016 and August 31, 2015 for assets and liabilities measured at fair value on a recurring basis. February 29, 2016 Level 1 Level 2 Level 3 Total Derivative Liabilities $ — $ — $ 78,172 $ 78,172 August 31, 2015 Level 1 Level 2 Level 3 Total Derivative Liabilities $ — $ — $ 1,664,993 $1,664,993.
Schedule of derivative instruments	The assumptions used in valuing derivative instruments issued during the six months ended February 29, 2016 were as follows: Risk free interest rate 0.51% - 1.22% Expected life .13 Years-5.25 years Dividend yield None Volatility 39% - 113%
Schedule of reconciliation of the derivative liability	The following is a reconciliation of the derivative liability related to these instruments for the six months ended February 29, 2016: Value at August 31, 2015 $ 1,664,993 Issuance of instruments 1,313 Change in value (222,735 ) Net settlements (1,365,399 ) Value as of February 29, 2016 $ 78,172

PROPERTY AND EQUIPMENT (Tables)

PROPERTY AND EQUIPMENT (Tables)	6 Months Ended
	Feb. 29, 2016
Property, Plant and Equipment [Abstract]
Schedule of property and equipment	At February 29, 2016 and August 31 2015, property and equipment consists of the following: February August Computer equipment $ 553,255 553,255 Software and Equipment 39,400 39,400 Furniture & Fixtures 9,177 9,177 601,832 601,832 Accumulated depreciation (491,551 ) (458,960 ) Net property and equipment $ 110,281 142,872

NOTES PAYABLE (Tables)

NOTES PAYABLE (Tables)	6 Months Ended
	Feb. 29, 2016
Debt Disclosure [Abstract]
Schedule of future minimum principal payments	The following is a schedule, by year, of future minimum principal payments required under notes payable as of February 29, 2016: Years Ending 2016 $ 7,413,415 2017 $ 37,329 2018 2019 — Total 7,450,744 Note discount (731,113 ) $ 6,719,631

STOCKHOLDERS' EQUITY (Tables)

STOCKHOLDERS' EQUITY (Tables)	6 Months Ended
	Feb. 29, 2016
Stockholders' Equity Note [Abstract]
Schedule of stock options activity	Employee Stock Options were granted on February 24, 2016 to purchase 1,675,000 shares at a price of $0.08. Transactions in 1H 2016 Quantity Weighted- Weighted- Outstanding, August 31, 2015 1,750,000 $ 0.37 9.29 Granted 2,585,000 $ 0.18 10.00 Exercised 0 0 Cancelled/Forfeited 0 0 Outstanding, February 29, 2016 4,335,000 $ 0.25 9.45 Exercisable, February 29, 2016 1,750,000 $ 0.37 8.79
Schedule of stock options, exercise price	The weighted average remaining contractual life of options outstanding issued under the Plan was 9.45 years at February 29, 2016. The exercise prices for the options outstanding at February 29, 2016 ranged from $0.01 to $0.75, and the information relating to these options is as follows: OPTIONS OUTSTANDING OPTIONS EXERCISABLE Quantity Weighted- Weighted- Quantity Weighted- Weighted- 700,000 $ 0.01 8.40 700,000 0.01 8.40 600,000 $ 0.50 9.03 600,000 0.50 9.03 450,000 $ 0.75 9.09 450,000 0.75 9.09 910,000 $ 0.35 9.69 1,675,000 $ 0.08 9.99 4,335,000 $ 0.25 9.45 1,750,000 $ 0.37 8.79
Schedule of warrants outstanding	The following is a summary of warrants outstanding at February 29, 2016: Exercise Price Number of Expiration Date $ 1.00 1,264,023 Nov 2024 $ 0.01 100,000 Jul 2016 $ 1.00 295,000 Apr 2020 $ 1.00 400,000 Aug 2020 $ 0.50 1,176,473 Aug 2020 $ 0.01 250,000 Dec 2020 $ 1.00 1,200,000 Aug 2021 $ 1.00 523,587 Aug 2021 $ 1.00 20,000 Aug 2021 $ 1.00 10,000 Aug 2021 $ 0.01 150,000 Feb 2018

COMMITMENTS AND CONTINGENCIES (

COMMITMENTS AND CONTINGENCIES (Tables)	6 Months Ended
	Feb. 29, 2016
Commitments and Contingencies Disclosure [Abstract]
Schedule of future minimum rental payments for operating leases	The following is a schedule, by year, of future minimum lease payments required under non-cancelable operating leases as of February 29, 2016: Years Ending 2016 (remaining) $ 313,659 2017 676,425 2018 694,857 2019 713,753 2020 716,767 Thereafter 1,642,397 $ 4,757,858

ORGANIZATION AND SUMMARY OF S22

ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES(Details Narrative) - USD ($)

Apr. 13, 2015

Dec. 31, 2015

Aug. 31, 2015

Apr. 30, 2015

Mar. 31, 2015

Feb. 29, 2016

Feb. 28, 2015

Feb. 29, 2016

Feb. 28, 2015

Dec. 31, 2014

Aug. 30, 2015

Jul. 31, 2014

May. 31, 2014

Dec. 31, 2013

Marketing and advertising expense

$ 37,278

$ 22,813

Change in fair value of derivative liability

498,750

$ 0

Net amount from financing activities

$ 885,000

Description of organization

Our Company currently has 102 employees and has served more than 50 education clients and over 75 degree programs.

Weighted average price per share

$ 0.18

Stock-based compensation

$ 98,750

Liability with conversion feature

$ 1,664,993

$ 78,172

78,172

Change in derivative liability

$ 20,486

$ (136,870)

$ 222,735

$ (135,901)

Exercisable warrant issued

248,011

Colgan Financial Group, Inc [Member]

Convertible promissory note

$ 500,000

$ 600,000

Interest rate

2.50%

Paydown equity funding

$ 144,000

Recevied additional funding

$ 200,000

Description of conversion price

On April 13, 2015, the Company and its lenders executed a second amendment (“ Second Amendment Credit Agreement Lenders

The conversion feature and warrants both include provisions that call for the instrument to be converted to equity at a price equal to the lesser of (i) $1.50 per share or (ii) 85% of the weighted average price per share of the Company’s trading price for the 10 trading days prior to conversion / exercise.

The conversion feature and warrants both include provisions that call for the instrument to be converted to equity at a price equal to the lesser of (i) $1.50 per share or (ii) 85% of the weighted average price per share of the Company’s trading price for the 10 trading days prior to conversion / exercise.

Redwood Fund, LP [Member]

Convertible promissory note

$ 588,236

$ 295,000

Description of conversion price

The conversion feature includes provisions that call for the instrument to be converted to equity at a price equal to (i) $1.00 if the Company’s common stock price closes above $1.00; (ii) the average of the publicly reported closing bid and ask price if the Company’s publicly reported common stock price closes between $0.50 and $0.99; or (iii) $0.50 if the Company’s publicly reported common stock price closes below $0.50.

The conversion feature includes provisions that call for the instrument to be converted to equity at a price equal to (i) $1.00 if the Company’s common stock price closes above $1.00; (ii) the average of the publicly reported closing bid and ask price if the Company’s publicly reported common stock price closes between $0.50 and $0.99; or (iii) $0.50 if the Company’s publicly reported common stock price closes below $0.50.

Liability with conversion feature

$ 27,925

Lincoln Park Capital Fund, LLP [Member]

Convertible promissory note

$ 295,000

$ 295,000

Interest rate

10.00%

10.00%

Description of conversion price

The conversion feature includes provisions that call for the instrument to be converted to equity at a price equal to (i) $1.00 if the Company’s common stock price closes above $1.00; (ii) the average of the publicly reported closing bid and ask price if the Company’s publicly reported common stock price closes between $0.50 and $0.99; or (iii) $0.50 if the Company’s publicly reported common stock price closes below $0.50.

First Fire Global Opportunities Fund, LLC [Member]

Convertible promissory note

$ 275,000

Description of conversion price

The conversion feature includes provisions that call for the instrument to be converted to equity at a price equal to $ 0.40 cents per share, subject to adjustment.

ORGANIZATION AND SUMMARY OF S23

ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details)	6 Months Ended
	Feb. 29, 2016
Equipment [Member] | Minimum [Member]
Property, Plant and Equipment [Line Items]
Useful life	5 years
Equipment [Member] | Maximum [Member]
Property, Plant and Equipment [Line Items]
Useful life	7 years
Computer Equipment [Member]
Property, Plant and Equipment [Line Items]
Useful life	7 years

ORGANIZATION AND SUMMARY OF S24

ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 1) - USD ($)	Feb. 29, 2016	Aug. 31, 2015
Derivative Liabilities	$ 78,172	$ 1,664,993
Level 1 [Member]
Derivative Liabilities
Level 2 [Member]
Derivative Liabilities
Level 3 [Member]
Derivative Liabilities	$ 78,172	$ 1,664,993

ORGANIZATION AND SUMMARY OF S25

ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 2)	6 Months Ended
	Feb. 29, 2016
Dividend yield
Maximum [Member]
Risk free interest rate	1.22%
Expected life	5 years 3 months
Volatility	113.00%
Minimum [Member]
Risk free interest rate	0.51%
Expected life	1 month 17 days
Volatility	39.00%

ORGANIZATION AND SUMMARY OF S26

ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 3)	6 Months Ended
	Feb. 29, 2016USD ($)
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Value at beginning	$ 1,664,993
Issuance of instruments	1,313
Change in value	(222,735)
Net settlements	(1,365,399)
Value at ending	$ 78,172

PROPERTY AND EQUIPMENT (Details

PROPERTY AND EQUIPMENT (Details) - USD ($)	Feb. 29, 2016	Aug. 31, 2015
Gross property and equipment	$ 601,832	$ 601,832
Accumulated depreciation	(491,551)	(458,960)
Net property and equipment	110,281	142,872
Furniture & Fixtures [Member]
Gross property and equipment	9,177	9,177
Computer Equipment [Member]
Gross property and equipment	553,255	553,255
Software and Equipment [Member]
Gross property and equipment	$ 39,400	$ 39,400

PROPERTY AND EQUIPMENT (Detai28

PROPERTY AND EQUIPMENT (Details Narrative) - USD ($)	6 Months Ended
	Feb. 29, 2016	Feb. 28, 2015
Property, Plant and Equipment [Abstract]
Depreciation and amortization expense	$ 32,591	$ 31,861

NOTES PAYABLE (Details Narrativ

NOTES PAYABLE (Details Narrative) - USD ($)

Apr. 14, 2016

Apr. 13, 2016

Feb. 04, 2016

Nov. 06, 2015

Aug. 14, 2015

Apr. 13, 2015

May. 22, 2014

Dec. 31, 2015

Aug. 21, 2015

Apr. 30, 2015

Mar. 31, 2015

Feb. 29, 2016

Aug. 31, 2014

Aug. 31, 2015

Dec. 31, 2014

Jan. 18, 2016

Dec. 14, 2015

Sep. 24, 2015

Feb. 28, 2015

Jul. 31, 2014

May. 31, 2014

May. 28, 2014

Dec. 31, 2013

Oct. 31, 2010

Exercisable warrant issued

248,011

Debt Instrument unamortized discount

$ 731,113

$ 1,364,771

Interest expense

$ 1,500,000

Weighted average price per share

$ 0.18

Common stock issued

48,824,629

45,114,297

Opus Bank [Member]

Outstanding amount

$ 1,561,944

Line of credit amount

2,057,670

Opus Bank [Member] | Credit Agreement (Second Amendment) [Member]

Outstanding amount

1,562,280

Amortization of debt discount

$ 13,000

Warrants value

$ 78,281

Exercisable warrant issued

248,011

Exercise price of warrant

$ 1

Warrants due to dilutive issuances

375,000

Debt Instrument unamortized discount

$ 32,617

Line of credit amount

$ 2,058,115

Line of credit interest rate

8.00%

Opus Bank [Member] | Credit Agreement (Second Amendment) [Member] | Lenders [Member]

Lone of credit maximum borrowing amount

$ 3,000,000

Opus Bank [Member] | Opus Credit Agreement (Third Amendment) [Member] | PCS Link [Member]

Interest rate

8.00%

Exercise price of warrant

$ 1

Warrants received for shares of common stock

1,200,000

Unsecured debt aggregate gross proceeds

$ 1,250,000

Opus Bank [Member] | Opus Credit Agreement (Third Amendment) [Member] | PCS Link [Member] | Subsequent Event [Member]

Maturity date

May 6, 2016

Opus Bank [Member] | Promissory Note [Member] | Credit Agreement [Member]

Outstanding amount

$ 2,000,000

California United Bank [Member]

Debt instrument fee amount

$ 912,706

California United Bank [Member] | Credit Agreement [Member] | Subsequent Event [Member]

Maturity date

May 6, 2016

May 6, 2016

California United Bank [Member] | Opus Credit Agreement (Third Amendment) [Member]

Exercise price

$ 1

Exercisable warrant issued

523,587

Deferred interest due upon raising working capital

$ 2,000,000

California United Bank [Member] | Promissory Note [Member]

Face Amount

$ 1,250,000

$ 1,250,000

Interest rate

7.25%

7.25%

Description of debt interest rate

Five percent (5%) in excess of the Prime Rate

Colgan Financial Group, Inc [Member]

Interest rate

2.50%

Amortization of the note discount

$ 137,000

Description of conversion price

On April 13, 2015, the Company and its lenders executed a second amendment (“ Second Amendment Credit Agreement Lenders

The conversion feature and warrants both include provisions that call for the instrument to be converted to equity at a price equal to the lesser of (i) $1.50 per share or (ii) 85% of the weighted average price per share of the Company’s trading price for the 10 trading days prior to conversion / exercise.

The conversion feature and warrants both include provisions that call for the instrument to be converted to equity at a price equal to the lesser of (i) $1.50 per share or (ii) 85% of the weighted average price per share of the Company’s trading price for the 10 trading days prior to conversion / exercise.

Colgan Financial Group, Inc [Member] | Promissory Note One [Member]

Face Amount

$ 500,000

Interest rate

12.00%

Colgan Financial Group, Inc [Member] | Promissory Note [Member] | Loan and Security Agreement [Member]

Face Amount

$ 688,120

$ 600,000

Interest rate

85.00%

85.00%

2.50%

Maturity date

May 6, 2016

Debt instrument increase additional borrowings

$ 200,000

Interest expense

$ 766,680

Weighted average price per share

$ 1.50

$ 1.50

Amortization of the note discount

$ 70,000

Fair value issunace of note

$ 323,000

Paydown amount in connection with an equity funding

$ 144,000

Conversion feature derivative liability value

$ 188,000

Convertible promissory notes

$ 200,000

RedwoodFundLpMember

Debt accrued interest

2,000

Amortization of debt discount

2,000

RedwoodFundLpMember | Promissory Note [Member]

Face Amount

$ 235,294

$ 30,000

Interest rate

10.00%

18.00%

Debt instrument increase additional borrowings

$ 15,000

Debt terms

1 year

Debt accrued interest

1,000

Description of original issue discount

15% or $35,294.

RedwoodFundLpMember | Convertible Note [Member]

Face Amount

$ 125,000

$ 295,000

Interest rate

10.00%

10.00%

Debt instrument increase additional borrowings

$ 250,000

Debt terms

6 months

5 years

Exercise price

$ 1

Debt accrued interest

$ 3,938

Interest expense

$ 1,165,202

2,346,461

Amortization of the note discount

$ 15,833

294,000

$ 177,647

Common stock issued

200,000

Convertible promissory notes

$ 250,000

Issued shares of common stock

588,236

3,359,775

Description of conversion price

The conversion feature includes provisions that call for the instrument to be converted to equity at a price equal to (i) $1.00 if the Company’s common stock price closes above $1.00; (ii) the average of the publicly reported closing bid and ask price if the Company’s publicly reported common stock price closes between $0.50 and $0.99; or (iii) $0.50 if the Company’s publicly reported common stock price closes below $0.50.

Description of original issue discount

20% or $25,000 .

Lincoln Park Capital Fund Llc [Member]

Recognized amortization of the note discount

123,000

Lincoln Park Capital Fund Llc [Member] | Convertible Note [Member]

Face Amount

$ 295,000

250,000

Interest rate

10.00%

Debt instrument increase additional borrowings

$ 247,000

Debt terms

1 year

Exercisable warrant issued

400,000

Exercise price of warrant

$ 1

Exercisable period of warrant

5 years

Amortization of the note discount

$ 215,000

Description of conversion price

The conversion feature includes provisions that call for the instrument to be converted to equity at a price equal to (i) $1.00 if the Company’s common stock price closes above $1.00; (ii) the average of the publicly reported closing bid and ask price if the Company’s publicly reported common stock price closes between $0.50 and $0.99; or (iii) $0.50 if the Company’s publicly reported common stock price closes below $0.50.

Recognized amortization of the note discount

108,000

First Fire Global Opportunities Fund, LLC [Member]

Description of conversion price

The conversion feature includes provisions that call for the instrument to be converted to equity at a price equal to $ 0.40 cents per share, subject to adjustment.

First Fire Global Opportunities Fund, LLC [Member] | Convertible Note [Member]

Face Amount

$ 275,000

Amortization of debt discount

$ 52,320

Exercisable warrant issued

250,000

Exercise price of warrant

$ 0.01

Amortization of the note discount

$ 17,000

Description of conversion price

The conversion feature includes provisions that call for the instrument to be converted to equity at a price equal to (i) shall be equal to $0.40 (the “Fixed Conversion Price”);provided, however that from and after the occurrence of any Event of Default hereunder, the Conversion Price shall be the lower of: (i) the Fixed Conversion Price or (ii) 75% multiplied by the lowest sales price of the Common Stock in a public market during the twenty-one (21) consecutive Trading Day period immediately preceding the Trading Day that the Company receives a Notice of Conversion; and provided, further, however, and notwithstanding the above calculation of the Conversion Price, if, prior to the repayment or conversion of this Note, in the event the Borrower consummates a registered or unregistered primary offering of its securities for capital raising purposes (a “Primary Offering”), the Holder shall have the right, in its discretion, to (x) demand repayment in full of an amount equal to any outstanding Principal Amount and interest (including Default Interest) under this Note as of the closing date of the Primary Offering or (y) convert any outstanding Principal Amount and interest (including any Default Interest) under this Note into Common Stock at the closing of such Primary Offering at a Conversion Price equal to the lower of (A) the Fixed Conversion Price and (B) a ten percent (10%) discount to the offering price to investors in the Primary Offering; provided, however, that from and after the occurrence of any Event of Default hereunder, the Conversion Price shall equal the lower of (Y) the Fixed Conversion Price and (Z) a twenty percent (20%) discount to the offering price to investors in the Primary Offering.

NOTES PAYABLE (Details)

NOTES PAYABLE (Details) - USD ($)	Feb. 29, 2016	Aug. 31, 2015
Years Ending August 31,
2,016	$ 7,413,415
2,017	$ 37,329
2,018
2,019
Total	$ 7,450,744
Note discount	(731,113)	$ (1,364,771)
Long-term Debt	$ 6,719,631

RELATED PARTY TRANSACTIONS (Det

RELATED PARTY TRANSACTIONS (Details Narrative) - USD ($)	Feb. 29, 2016	Jun. 09, 2015	Dec. 31, 2013
Related Party Transaction [Line Items]
Service credits		$ 174,000
Other payment owed for services	$ 10,000
MarkeTouch Media, Inc. [Member]
Related Party Transaction [Line Items]
Percentage of ownership			7.50%
Service credits		$ 174,000

STOCKHOLDERS' EQUITY (Details N

STOCKHOLDERS' EQUITY (Details Narrative) - USD ($)	Sep. 24, 2015	Sep. 16, 2015	Feb. 29, 2016	Feb. 28, 2015	Feb. 29, 2016	Feb. 28, 2015	Feb. 24, 2016	Aug. 31, 2015	Jun. 09, 2015	Jul. 31, 2014
Common Stock, authorized			937,500,000		937,500,000			937,500,000
Common stock, par value (in dollars per share)			$ 0.001		$ 0.001			$ 0.001
Service credits									$ 174,000
Number of shares outstanding			4,335,000		4,335,000			1,750,000
Granted shares					2,585,000
Excercise price of options outstanding			$ 0.25		$ 0.25			$ 0.37
Interest expense			$ 636,724	$ 202,270	$ 2,689,516	$ 311,798
Value of shares issued for services					$ (427,676)
Weighted average remaining contractual life					9 years 5 months 12 days
Interest expense					$ 1,500,000
Consulting Agreements [Member] | Warrant [Member]
Number of warrants granted					2,153,587
Value of warrants granted					$ 116,002
2014 Stock Option Plan [Member]
Number of shares authorized										5,000,000
Maximum [Member]
Number of shares outstanding			0.35		0.35
Excercise price of options outstanding			$ 0.01		$ 0.01
Maximum [Member] | Employee Stock Options [Member]
Risk free interest rate					2.72%
Volatility					100.00%
Minimum [Member]
Number of shares outstanding			0.75		0.75
Excercise price of options outstanding			$ 0.75		$ 0.75
Minimum [Member] | Employee Stock Options [Member]
Risk free interest rate					1.21%
Volatility					30.00%
MarkeTouch Media, Inc. [Member]
Service credits									$ 174,000
Ignite Capital [Member] | Consulting Agreements [Member]
Number of shares issued for services (in shares)					250,000
Value of shares issued for services					$ 290,000
Uptick Capital [Member] | Consulting Agreements [Member]
Number of shares issued for services (in shares)					410,332
Value of shares issued for services					$ 97,676
EMC, LLC [Member] | Consulting Agreements [Member]
Number of shares issued for services (in shares)					500,000
Value of shares issued for services					$ 40,000
Common Stock [Member] | Rogers [Member]
Shares issued for common stock		625,000
Common Stock [Member] | Byrne [Member]
Shares issued for common stock		625,000
Common Stock [Member] | Colgan Financial Group, Inc [Member]
Exercise price	$ 0.10
Debt face amount	$ 80,000
Interest expense	$ 1,365,391
Employee Stock Options [Member]
Number of shares outstanding			4,335,000		4,335,000		1,675,000
Exercise price (in dollars per share)							$ 0.08
Expected life					5 years 6 months
Excercise price of options outstanding			$ 0.25		$ 0.25
Weighted average remaining contractual life					9 years 5 months 12 days
Employee Stock Options [Member] | Board Of Directors [Member]
Number of shares outstanding			910,000		910,000
Additional number of shares outstanding			1,750,000		1,750,000
Exercise price (in dollars per share)			$ 0.35		$ 0.35

STOCKHOLDERS' EQUITY (Details)

STOCKHOLDERS' EQUITY (Details)	6 Months Ended
	Feb. 29, 2016$ / sharesshares
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward]
Outstanding, beggining balance | shares	1,750,000
Granted | shares	2,585,000
Exercised | shares	0
Cancelled/Forfeited | shares	0
Outstanding, ending balance | shares	4,335,000
Exercisable, ending balance | shares	1,750,000
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Roll forward]
Outstanding, beggining balance | $ / shares	$ 0.37
Granted | $ / shares	0.18
Exercised | $ / shares	0
Cancelled/Forfeited | $ / shares	0
Outstanding, ending balance | $ / shares	0.25
Exercisable, ending balance | $ / shares	$ 0.37
Weighted-Average Remaining Contractual Life [Roll-Forward]
Outstanding, Beggining Balance	9 years 3 months 14 days
Granted	10 years
Outstanding, Ending Balance	9 years 5 months 12 days
Exercisable, Ending Balance	8 years 9 months 15 days

STOCKHOLDERS' EQUITY (Details 1

STOCKHOLDERS' EQUITY (Details 1) - $ / shares	6 Months Ended
	Feb. 29, 2016	Feb. 24, 2016	Aug. 31, 2015
Option Outstanding	4,335,000		1,750,000
Option Exercise Price	$ 0.25		$ 0.37
Option Remaining Contractual Life	9 years 5 months 12 days
Option Exercisable	1,750,000
Option Exercisable, Price	$ 0.37
Option Exercisable, Remaining Contractual Life	8 years 9 months 15 days
Employee Stock Options [Member]
Option Outstanding	4,335,000	1,675,000
Option Exercise Price	$ 0.25
Option Remaining Contractual Life	9 years 5 months 12 days
Option Exercisable	1,750,000
Option Exercisable, Price	$ 0.37
Option Exercisable, Remaining Contractual Life	9 years 9 months 15 days
$ 0.01 [Member] | Employee Stock Options [Member]
Option Outstanding	700,000
Option Exercise Price	$ 0.01
Option Remaining Contractual Life	8 years 4 months 25 days
Option Exercisable	700,000
Option Exercisable, Price	$ 0.01
Option Exercisable, Remaining Contractual Life	8 years 4 months 25 days
$ 0.50 [Member] | Employee Stock Options [Member]
Option Outstanding	600,000
Option Exercise Price	$ 0.50
Option Remaining Contractual Life	9 years 11 days
Option Exercisable	600,000
Option Exercisable, Price	$ 0.50
Option Exercisable, Remaining Contractual Life	9 years 11 days
$ 0.75 [Member] | Employee Stock Options [Member]
Option Outstanding	450,000
Option Exercise Price	$ 0.75
Option Remaining Contractual Life	9 years 1 month 2 days
Option Exercisable	450,000
Option Exercisable, Price	$ 0.75
Option Exercisable, Remaining Contractual Life	9 years 1 month 2 days
$ 0.35 [Member] | Employee Stock Options [Member]
Option Outstanding	910,000
Option Exercise Price	$ 0.35
Option Remaining Contractual Life	9 years 8 months 9 days
$ 0.08 [Member] | Employee Stock Options [Member]
Option Outstanding	1,675,000
Option Exercise Price	$ 0.08
Option Remaining Contractual Life	9 years 8 months 9 days

STOCKHOLDERS' EQUITY (Details 2

STOCKHOLDERS' EQUITY (Details 2) - Warrant [Member]	6 Months Ended
	Feb. 29, 2016$ / sharesshares
Exercise Price $ 1.00 [Member]
Warrants Outstanding Exercise Price | $ / shares	$ 1
Number of Warrants Outstanding | shares	1,264,023
Warrants Outstanding Expiration Date	Nov. 30, 2024
Exercise Price $ 0.01 [Member]
Warrants Outstanding Exercise Price | $ / shares	$ 0.01
Number of Warrants Outstanding | shares	100,000
Warrants Outstanding Expiration Date	Jul. 31, 2016
Exercise Price $ 1.00 [Member]
Warrants Outstanding Exercise Price | $ / shares	$ 1
Number of Warrants Outstanding | shares	295,000
Warrants Outstanding Expiration Date	Apr. 30, 2020
Exercise Price $ 1.00 [Member]
Warrants Outstanding Exercise Price | $ / shares	$ 1
Number of Warrants Outstanding | shares	400,000
Warrants Outstanding Expiration Date	Aug. 31, 2020
Exercise Price $ 0.50 [Member]
Warrants Outstanding Exercise Price | $ / shares	$ 0.50
Number of Warrants Outstanding | shares	1,176,473
Warrants Outstanding Expiration Date	Aug. 31, 2020
Exercise Price $ 0.01 [Member]
Warrants Outstanding Exercise Price | $ / shares	$ 0.01
Number of Warrants Outstanding | shares	250,000
Warrants Outstanding Expiration Date	Dec. 31, 2020
Exercise Price $ 1.00 [Member]
Warrants Outstanding Exercise Price | $ / shares	$ 1
Number of Warrants Outstanding | shares	1,200,000
Warrants Outstanding Expiration Date	Aug. 31, 2021
Exercise Price $ 1.00 [Member]
Warrants Outstanding Exercise Price | $ / shares	$ 1
Number of Warrants Outstanding | shares	523,587
Warrants Outstanding Expiration Date	Aug. 31, 2021
Exercise Price $ 1.00 [Member]
Warrants Outstanding Exercise Price | $ / shares	$ 1
Number of Warrants Outstanding | shares	20,000
Warrants Outstanding Expiration Date	Aug. 31, 2021
Exercise Price $ 1.00 [Member]
Warrants Outstanding Exercise Price | $ / shares	$ 1
Number of Warrants Outstanding | shares	10,000
Warrants Outstanding Expiration Date	Aug. 31, 2021
Exercise Price $ 0.01 [Member]
Warrants Outstanding Exercise Price | $ / shares	$ 0.01
Number of Warrants Outstanding | shares	150,000
Warrants Outstanding Expiration Date	Feb. 28, 2018

CONCENTRATIONS (Details Narrati

CONCENTRATIONS (Details Narratives) - Customer Concentration Risk [Member] - Sales Revenue, Services, Net [Member] - Number	6 Months Ended
	Feb. 29, 2016	Feb. 28, 2015
Concentration Risk [Line Items]
Percentage of concentration risk	52.00%	44.00%
Number of customer	4	1
Number of projects		2

INCOME TAXES (Details Narrative

INCOME TAXES (Details Narratives)	6 Months Ended
	Feb. 29, 2016
Income Tax Disclosure [Abstract]
Percentage of valuation allowance	100.00%

COMMITMENTS AND CONTINGENCIES38

COMMITMENTS AND CONTINGENCIES (Details)	Aug. 31, 2015USD ($)
Commitments and Contingencies Disclosure [Abstract]
2016 (remaining)	$ 313,659
2,017	676,425
2,018	694,857
2,019	713,753
2,020	716,767
Thereafter	1,642,397
Total	$ 4,757,858

COMMITMENTS AND CONTINGENCIES39

COMMITMENTS AND CONTINGENCIES (Details Narratives) - USD ($)	Mar. 11, 2016	Feb. 29, 2016	Feb. 28, 2015
Commitments and Contingencies Disclosure [Abstract]
Loss Contingency, Loss in Period		$ 5,000,000
Lease Expiration Period		2,024
Operating Leases, Rent Expense, Net		$ 363,164	$ 5,121
Gain (Loss) on Contract Termination	$ 100,000	$ 250,000

DISCONTINUED OPERATIONS (Detail

DISCONTINUED OPERATIONS (Details Narrative) - USD ($)	Feb. 29, 2016	Aug. 31, 2015
Discontinued Operations and Disposal Groups [Abstract]
Current assets to be disposed	$ 37,000	$ 37,000
Current liabilities to be disposed	$ 336,000	$ 336,000

SUBSEQUENT EVENTS (Details Narr

SUBSEQUENT EVENTS (Details Narrative) - Subsequent Event [Member]	Apr. 14, 2016	Apr. 13, 2016
Opus Bank [Member] | PCS Link [Member] | Opus Credit Agreement (Third Amendment) [Member]
Maturity date		May 6, 2016
California United Bank [Member] | Credit Agreement [Member]
Maturity date	May 6, 2016	May 6, 2016