| Summary of Significant Accounting Policies | NOTE 1 - Summary of Significant Accounting Policies Description of Business The Vemanti Group Inc. is focused on revolutionizing the hospitality industry through digital innovation, seamlessly integrating new revenue streams without disrupting existing operations. We are a holding company that operates principally through our wholly owned subsidiary, VinHMS Pte. Ltd. (“VinHMS”). VinHMS was incorporated in Singapore on November 1, 2023. VinHMS is a technology solutions provider specializing in digital transformation for the hospitality industry across Southeast Asia. VinHMS’s native cloud-based platforms focus on reducing overall costs, streamlining processes, enhancing operational efficiency, accelerating new innovations, improving guest experiences, and increasing financial performance for hotel operators utilizing artificial intelligence (AI), machine learning (ML), and proprietary advanced algorithms. In addition to its flagship hospitality management solution, CiHMS, VinHMS offers a suite of products, including asset management (“CiAMS”), theme park management (“CiTMS”), and a digital transformation solution for small hotels (“CiTravel”). Business Combination and Organization On April 1, 2024, Vemanti entered into a share exchange agreement (the “Share Exchange Agreement”) with VinHMS Pte. Ltd., a Singapore private company limited by shares (“VinHMS”), and Mr. Hoang Van Nguyen and Asian Star Trading & Investment Pte. Ltd. (“Asian Star”), the sole shareholders of VinHMS (the “Shareholders”), whereby Vemanti will acquire VinHMS for $20,000,000 through the issuance of 10,000,000 Preferred B Shares and the transfer of 40,000,000 Preferred A Shares from Mr. Tan Tran to Mr. Hoang Van Nguyen and Asian Star Trading & Investment Pte. Ltd.. Each Preferred B share can be converted into 26 Common shares after a 12-month lock-up agreement which was executed on April 1, 2024. As of today, no Preferred B shares have been converted. Any conversion can only be executed on or after April 1, 2025. As part of the transaction, Vemanti disposed of VoiceStep LLC thereby transferring it to Mr. Tan Tran. VinHMS Pte. Ltd. is now the only wholly owned subsidiary of Vemanti. The Business Combination is being accounted for as a reverse recapitalization in accordance with U.S. GAAP. Under this method of accounting, Vemanti, who is the legal acquirer, is being treated as the “acquired” company for financial reporting purposes and VinHMS is being treated as the accounting acquirer. This determination was primarily based on the following facts and circumstances: o VinHMS stockholders have 100% of the voting interests of the Preferred A shares; o VinHMS’ CEO has been named as the CEO of the Company; o the directors nominated by VinHMS represent the majority of the board of directors of the Company; o VinHMS is the larger entity, in terms of substantive operations and employee base; o VinHMS’ operations comprise the ongoing operations of the Company. Accordingly, for accounting purposes, the Business Combination is being treated as the equivalent of a reverse recapitalization transaction in which VinHMS issued stock for the net assets of Vemanti. The net assets of Vemanti are being stated at historical cost, with no goodwill or other intangible assets recorded. Operations prior to the Business Combination are those of VinHMS. Certain prior period amounts in the consolidated and combined financial statements have been reclassified to conform to the current period presentation. Basis of Presentation These unaudited condensed consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). These unaudited consolidated financial statements should be read in conjunction with the audited consolidated financial statements in our Annual Report on Form 10-K, which we filed with the Securities and Exchange Commission (“SEC”) on March 28, 2024, and notes thereto. In preparing these unaudited condensed consolidated financial statements, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of the unaudited condensed consolidated financial statements and the reported amount of revenues and expenses during the reporting periods. Actual results could differ from those estimates. The most significant estimates and assumptions included in the Company’s unaudited condensed consolidated financial statements relate to allowances for doubtful accounts, valuation allowance for deferred income taxes and recoverability of other assets and intangible assets. The Company’s consolidated financial statements are prepared on a going concern basis in accordance with generally accepted accounting principles in the United States (“US GAAP”) which contemplates the realization of assets and discharge of liabilities and commitments in the normal course of business. The Company has not generated significant operating revenues to cover costs and has funded its operations through the issuance of capital stock and financing. There is no certainty that further funding will be available as needed. These factors raise substantial doubt about the ability of the Company to continue operating as a going concern. The Company’s ability to continue its operations as a going concern, realize the carrying value of its assets, and discharge its liabilities in the normal course of business is dependent upon the continued support of its controlling shareholders, its ability to raise capital sufficient to fund its commitments and ongoing losses, and ultimately generating profitable operations. Restatement of Previously Issued Consolidated Financial Statements The Company has restated its Consolidated Balance Sheets as of June 30, 2024, Statement of Stockholder’s Equity (Deficit), and its Notes to the Consolidated Financial Statements of the six months ended June 30, 2024, which was originally filed with the U.S. Securities and Exchange Commission (the “SEC”) on August 21, 2024 (the “Original Form 10-Q”). These consolidated financial statements have been restated to reflect a change in treatment of the Preferred Series B shares. Management reassessed the accounting treatment of the Preferred Series B shares. Management determined that the Company should account for the Preferred Series B shares as permanent equity and not mezzanine equity as the conversion is for a set number of shares determined upon the issuance of the shares. In light of the above, the Company is restating its financial statements as of and for the six months ended June 30, 2024 and December 31, 2023. Restatement as of June 30, 2024, Reconciliation: Balance Sheet Re-Statement As Filed Adjustments As Re-Stated ASSETS Current Assets: Cash $ 7,674 $ - $ 7,674 Prepaid Expenses 13,768 - 13,768 Accounts Receivable, net - related party 373,733 - 373,733 Other Current Assets 307 - 307 Total Current Assets 395,482 - 395,482 TOTAL ASSETS $ 395,482 $ - $ 395,482 LIABILITIES AND STOCKHOLDERS' EQUITY Current Liabilities: Accounts Payable $ 90,770 $ - $ 90,770 Accounts Payable - related party 108,054 - 108,054 Accrued Interest Payable 19,367 - 19,367 Accrued Expenses 30,000 - 30,000 Note Payable 57,544 - 57,544 Note Payable, net - related party 4,031,543 - 4,031,543 Loan from Stockholder - related party 25,000 - 25,000 Total Current Liabilities 4,362,278 - 4,362,278 Non-Current Liabilities: Note Payable, net - related party 4,823,464 - 4,823,464 Total Non-Current Liabilities 4,823,464 - 4,823,464 TOTAL LIABILITIES 9,185,742 - 9,185,742 Preferred B Stock, $0.0001 par value, 10,000,000 shares authorized; 10,000,000 shares issued and outstanding. 20,000,000 (20,000,000 ) - STOCKHOLDERS' EQUITY Preferred A Stock, $0.0001 par value, 50,000,000 shares authorized; 40,000,000 shares issued and outstanding. 4,000 - 4,000 Preferred B Stock, $0.0001 par value, 10,000,000 shares authorized; 10,000,000 shares issued and outstanding. - 20,000,000 20,000,000 Common Stock, $0.0001 par value, 500,000,000 shares authorized; 73,435,503 shares issued and outstanding as of June 30, 2024 and Ordinary Shares, no par value 1,000,000 shares issued and outstanding as of December 31, 2023. 7,341 - 7,341 Stock Payable 64,540 - 64,540 Additional Paid-in-Capital (28,620,047 ) - (28,620,047 ) Accumulated Deficit (246,094 ) - (246,094 ) Total Stockholders' Equity (28,790,260 ) 20,000,000 (8,790,260 ) TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 395,482 $ - $ 395,482 Accounts Receivables The Company regularly reviews its accounts receivables for collectability and establishes an allowance for doubtful accounts as necessary using the allowance method. The receivables are not collateralized. There was no allowance for doubtful accounts at both June 30, 2024 and December 31, 2023. The Company estimates the ability to collect receivables by performing ongoing credit evaluations of its customers’ financial condition. Estimates are based on assumptions and other considerations, including payment history, credit ratings, customer financial performance, industry financial performance and aging analysis. The Company reviews its accounts receivable by aging category and to identify customers with known disputes or collection issues. In determining the allowance, the Company makes judgments about the creditworthiness of a majority of its customers based on ongoing credit evaluations. The Company also considers its historical level of credit losses and current economic trends that might impact the level of future credit losses. Accounts receivables are written-off when they are deemed uncollectible. Equipment Equipment is stated at cost. Expenditures for maintenance and repairs are charged to operations as incurred; additions, renewals and betterments are capitalized. When equipment is retired or otherwise disposed of, the related cost and accumulated depreciation are removed from the respective accounts, and any gain or loss is included in operations. Depreciation of equipment was provided using the straight-line method for substantially all assets with estimated lives as follows: Software licenses 5 years Computer equipment 5 years As of June 30, 2024 and December 31, 2023, the Company had no equipment to depreciate. Intangible Assets The Company holds intangible assets with finite lives. Intangible assets with finite useful lives are amortized over their respective estimated useful lives, ranging from three to ten years, based on a pattern in which the economic benefit of the respective intangible asset is realized. Identifiable intangible assets recognized in conjunction with acquisitions are recorded at fair value. Significant unobservable inputs are used to determine the fair value of the identifiable intangible assets based on the income approach valuation model whereby the present worth and anticipated future benefits of the identifiable intangible assets were discounted back to their net present value. The Company evaluates the recoverability of intangible assets whenever events or changes in circumstances indicate that an intangible asset carrying amount may not be recoverable. The Company annually evaluates the remaining useful lives of all intangible assets to determine whether events and circumstances warrant a revision to the remaining period of amortization. The Company has intangible assets related to its hospitality suite of products including: · CiHMS, hospitality management solution; · CiAMS, hospitality asset management; · CiTMS, theme park management; and, · CiTravel, a digital transformation solution for small hotels. The software was acquired from VINHMS Software Production and Trading Joint Stock Company and as such no step-up in basis was recorded on the transaction. As of June 30, 2024, all of the products have been fully amortized. At December 31, 2023, the Company had no intangible assets to amortize. Long-Lived Assets The Company applies the provisions of Accounting Standards Codification (“ASC”) Topic 360, Property, Plant, and Equipment Revenue Recognition The Company recognizes revenue in accordance with ASC Topic 606, Revenue from Contracts with Customers The Company recognizes revenues derived from the subscriptions of its hotel management software. These revenues are accounted for as a single performance obligation satisfied over time because the customer simultaneously receives and consumes the benefits of the Company’s performance on a monthly basis. These arrangements stipulate monthly billing, and the Company has elected the “as invoiced” practical expedient to recognize revenue as the services are consumed as the Company has the right to payment in an amount that corresponds directly with the value of performance completed to date. Taxes collected from customers and remitted to a governmental authority are reported on a net basis and are excluded from revenue. Revenue is billed in advance on a fixed-rate basis. The remainder of revenue is billed in arrears on a transactional basis determined by customer usage. The Company often bills customers for upfront charges. These charges relate to down payments, implementation fees or prepayments for future services or equipment and are influenced by various business factors including how the Company and customer agree to structure the payment terms. These payments are recognized as deferred revenue until the service is provided or equipment is delivered and installed. All ongoing fees are billed and recognized as revenue on a monthly basis as service is provided. The Company uses a related party, VINHMS Software Production and Trading Joint Stock Company (“VinHMS VN”), to collect revenue from its Vietnam customers through a sales and distribution agreement until December 31, 2024, at which time the contracts will be renewed with VinHMS Pte. Ltd. VinHMS pte. Ltd. pays a commission of 15% of sales to VinHMS VN to perform this service. These revenues are recognized net of the 15% commission fees as Vemanti is acting as an agent. Stock-Based Compensation The Company records stock-based compensation in accordance with Financial Accounting Standards Board (“FASB”) ASC Topic 718, Compensation – Stock Compensation Income Taxes The Company accounts for income taxes in accordance with ASC Topic 740, Income Taxes Under ASC 740, a tax position is recognized as a benefit only if it is “more likely than not” that the tax position would be sustained in a tax examination, with a tax examination being presumed to occur. The amount recognized is the largest amount of tax benefit that is greater than 50% likely of being realized on examination. For tax positions not meeting the “more likely than not” test, no tax benefit is recorded. Basic and Diluted Earnings (Loss) Per Share Earnings (loss) per share is calculated in accordance with ASC Topic 260, Earnings Per Share Fair Value Measurements The Company applies the provisions of ASC 820-10, “Fair Value Measurements and Disclosures”. • Level 1 inputs to the valuation methodology are quoted prices for identical assets or liabilities in active markets. • Level 2 inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument. • Level 3 inputs to the valuation methodology are unobservable and significant to the fair value measurement. For certain financial instruments, the carrying amounts reported in the balance sheets for cash, investments, and current liabilities, each qualify as financial instruments and are a reasonable estimate of their fair values because of the short period of time between the origination of such instruments and their expected realization and their current market rate of interest. It is not practicable to estimate the fair value of the loan from stockholder due to its related party nature. At June 30, 2024, the Company identified a note payable that is required to be presented on the balance sheet at fair value (see NOTE 7 – Note Payable). At December 31, 2023, the Company did not identify any assets or liabilities that are required to be presented on the balance sheet at fair value. Recent Authoritative Guidance In August 2020, the FASB issued ASU No. 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for convertible Instruments and Contracts in an Entity’s Own Equity In May 2021, the FASB issued ASU No. 2021-04, Issuer’s Accounting for Certain Modifications or Exchanges of Freestanding Equity-Classified Written Call Options – a Consensus of the FASB Emerging Issues Task Force Management does not believe any other recently issued but not yet effective accounting pronouncement, if adopted, would have a material impact effect on the Company’s present or future financial statements. |
