| Nature of Business and Significant Accounting Policies | Note
1 – Nature of Business and Significant Accounting Policies Nature
of Business One
World Pharma, Inc. (formerly Punto Group, Corp.) was incorporated in Nevada on September 2, 2014. On February 21, 2019, subsequent
to period covered by these financial statements, One World Pharma, Inc. (“One World Pharma,” the “Company,”
“we,” “our” or “us”) entered into an Agreement and Plan of Merger with OWP Merger Subsidiary,
Inc., our wholly-owned subsidiary, and OWP Ventures, Inc. (“OWP Ventures”), which is the parent company of One World
Pharma SAS, a Colombian company (“OWP Colombia”). Pursuant to the Merger Agreement, we acquired OWP Ventures (and
indirectly, OWP Colombia) by the merger of OWP Merger Subsidiary with and into OWP Ventures, with OWP Ventures being the surviving
entity as our wholly-owned subsidiary (the “Merger”). As a result of the Merger (a) holders of the outstanding capital
stock of OWP Ventures received an aggregate of 39,475,398 shares of our common stock; (b) options to purchase 825,000 shares of
common stock of OWP Ventures at an exercise price of $0.50 automatically converted into options to purchase 825,000 shares of
our common stock at an exercise price of $0.50; (c) the outstanding principal and interest under a $300,000 convertible note issued
by OWP Ventures became convertible, at the option of the holder, into shares of our common stock at a conversion price equal to
the lesser of $0.424 per share or 80% of the price we sell our common stock in a future “Qualified Offering”; (d)
875,000 shares of our common stock owned by OWP Ventures prior to the Merger were cancelled; and (e) OWP Ventures’s chief
operating officer became our chief operating officer and two of OWP Ventures’s directors became members of our board of
directors. OWP Colombia is currently in the process of cultivating medicinal cannabis at a facility in Popayán, Colombia
for a variety of medical conditions. OWP Colombia has registered 15 varieties or strains of cannabis with the Colombian Ministry
of Health and intends to register an additional 65 varieties by the end of 2019. The Company’s headquarters are located in Las
Vegas, Nevada and substantially all of its customers are expected to be outside of the United States. Basis
of Accounting The
accompanying financial statements have been prepared in conformity with accounting principles generally accepted in the United
States of America and the rules of the Securities and Exchange Commission (SEC). All references to Generally Accepted Accounting
Principles (“GAAP”) are in accordance with The FASB Accounting Standards Codification (“ASC”) and the
Hierarchy of Generally Accepted Accounting Principles. These
statements reflect all adjustments, consisting of normal recurring adjustments, which in the opinion of management are necessary
for fair presentation of the information contained therein. Reclassifications Prior
period accrued expenses of $8,000 have been reclassified from accounts payable and accrued liabilities, and $38,733 of professional
fees have been reclassified from general and administrative expenses, to conform to the current period presentation. These reclassifications
had no impact on net earnings, financial position or cash flows. Use
of Estimates The
preparation of financial statements in conformity with accounting principles generally accepted in the United States of America
requires management to make estimates and assumptions that may affect the reported amounts of assets and liabilities and disclosure
of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from these estimates. Segment
Reporting ASC
Topic 280, “Segment Reporting,” requires use of the “management approach” model for segment reporting.
The management approach model is based on the way a company’s management organizes segments within the company for making
operating decisions and assessing performance. The Company operates as a single segment and will evaluate additional segment disclosure
requirements as it expands its operations. Fair
Value of Financial Instruments The
Company adopted ASC 820, Fair Value Measurements and Disclosures (ASC 820). ASC 820 defines fair value, establishes a three-level
valuation hierarchy for disclosures of fair value measurement and enhances disclosure requirements for fair value measures. The
three levels are defined as follows:
- Level
1 inputs to the valuation methodology are quoted prices (unadjusted) 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 valuation methodology are unobservable and significant to the fair measurement. The carrying value of cash, accounts receivable,
accounts payables and accrued expenses are estimated by management to approximate fair value primarily due to the short-term nature
of the instruments. Revenue Recognition Effective January 1, 2018, the Company adopted
ASC 606 — Revenue from Contracts with Customers. Under ASC 606, the Company recognizes revenue from the commercial sales
of products, licensing agreements and contracts to perform pilot studies by applying the following steps: (1) identify the contract
with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the
transaction price to each performance obligation in the contract; and (5) recognize revenue when each performance obligation is
satisfied. For the comparative periods, revenue has not been adjusted and continues to be reported under ASC 605 — Revenue
Recognition. Under ASC 605, revenue is recognized when the following criteria are met: (1) persuasive evidence of an arrangement
exists; (2) the performance of service has been rendered to a customer or delivery has occurred; (3) the amount of fee to be paid
by a customer is fixed and determinable; and (4) the collectability of the fee is reasonably assured. There
was no impact on the Company’s financial statements from ASC 606 for the years ended December 31, 2018 or 2017. Advertising
Costs The
Company expenses the cost of advertising and promotions as incurred. No advertising and promotions expense was incurred for the
years ended December 31, 2018 and 2017. Basic
and Diluted Loss Per Share The
basic net loss per common share is computed by dividing the net loss by the weighted average number of common shares outstanding.
Diluted net loss per common share is computed by dividing the net loss adjusted on an “as if converted” basis, by
the weighted average number of common shares outstanding plus potential dilutive securities. For the years ended December 31, 2018
and 2017, potential dilutive securities had an anti-dilutive effect and were not included in the calculation of diluted net
loss per common share. Stock-Based
Compensation The
Company accounts for equity instruments issued to employees in accordance with the provisions of ASC 718 Stock Compensation (ASC
718) and Equity-Based Payments to Non-employees pursuant to ASC 505-50 (ASC 505-50). All transactions in which goods or services
are the consideration received for the issuance of equity instruments are accounted for based on the fair value of the consideration
received or the fair value of the equity instrument issued, whichever is more reliably measurable. The measurement date of the
fair value of the equity instrument issued is the earlier of the date on which the counterparty’s performance is complete or the
date at which a commitment for performance by the counterparty to earn the equity instruments is reached because of sufficiently
large disincentives for nonperformance. Income
Taxes The
Company recognizes deferred tax assets and liabilities based on differences between the financial reporting and tax basis of assets
and liabilities using the enacted tax rates and laws that are expected to be in effect when the differences are expected to be
recovered. The Company provides a valuation allowance for deferred tax assets for which it does not consider realization of such
assets to be more likely than not. Uncertain
Tax Positions In
accordance with ASC 740, “Income Taxes” (“ASC 740”), the Company recognizes the tax benefit from an uncertain
tax position only if it is more likely than not that the tax position will be capable of withstanding examination by the taxing
authorities based on the technical merits of the position. These standards prescribe a recognition threshold and measurement attribute
for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. These
standards also provide guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosure,
and transition. Various
taxing authorities periodically audit the Company’s income tax returns. These audits include questions regarding the Company’s
tax filing positions, including the timing and amount of deductions and the allocation of income to various tax jurisdictions.
In evaluating the exposures connected with these various tax filing positions, including state and local taxes, the Company records
allowances for probable exposures. A number of years may elapse before a particular matter, for which an allowance has been established,
is audited and fully resolved. The Company has not yet undergone an examination by any taxing authorities. The
assessment of the Company’s tax position relies on the judgment of management to estimate the exposures associated with
the Company’s various filing positions. Various
taxing authorities periodically audit the Company’s income tax returns. These audits include questions regarding the Company’s
tax filing positions, including the timing and amount of deductions and the allocation of income to various tax jurisdictions.
In evaluating the exposures connected with these various tax filing positions, including state and local taxes, the Company records
allowances for probable exposures. A number of years may elapse before a particular matter, for which an allowance has been established,
is audited and fully resolved. The Company has not yet undergone an examination by any taxing authorities. Recent
Accounting Pronouncements In
June 2018, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”)
2018-07, Compensation-Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting In
February 2018, the FASB issued ASU No. 2018-02, Reclassification of Certain Tax Effects from Accumulated Other Comprehensive
Income In
May 2017, the FASB issued ASU 2017-09, Compensation-Stock Compensation (Topic 718): Scope of Modification Accounting In
May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers There
are no other recently issued accounting pronouncements that the Company has yet to adopt that are expected to have a material
effect on its financial position, results of operations, or cash flows. |
