| Note 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | Principles of Consolidation and Basis
of Presentation The condensed consolidated
financial statements include the accounts of Cure Pharmaceutical Holding Corp (CPHC) and its wholly-owned subsidiary,
Cure Pharmaceutical Corporation (Cure), collectively referred to as (Cure, we, us,
our or the Company All significant inter-company balances and transactions have been eliminated in
consolidation. The Companys film strip product represents the principal operations of the Company. The accompanying unaudited
condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the
United States of America for interim financial statements and with the instructions to Form 10-Q and Article 8 of Regulation S-X
of the United States Securities and Exchange Commission (SEC). Accordingly, they do not contain all information and
footnotes required by accounting principles generally accepted in the United States of America for annual financial statements.
In the opinion of the Companys management, the accompanying unaudited condensed consolidated financial statements contain
all the adjustments necessary (consisting only of normal recurring accruals) to present the financial position of the Company as
of June 30, 2017, and the results of operations and cash flows for the periods presented. The results of operations for the three
and six months ended June 30, 2017 and 2016, are not necessarily indicative of the operating results for the full fiscal year or
any future period. These unaudited condensed consolidated financial statements should be read in conjunction with the financial
statements and related notes thereto included in Form 10-K for the fiscal period ended December 31, 2016 filed with the Securities
and Exchange Commission (the SEC) on April 17, 2017. Use of Estimates The preparation of financial
statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets
and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements. These estimates and
assumptions also affect the reported amounts of revenues, costs and expenses during the reporting period. Management evaluates
these estimates and assumptions on a regular basis. Actual results could differ from those estimates. Cash and Cash Equivalents The Company considers
all cash on hand and in banks, including accounts in book overdraft positions, certificates of deposit and other highly-liquid
investments with maturities of three months or less, when purchased, to be cash and cash equivalents. As of June 30, 2017 and December
31, 2016, the Company had no cash equivalents. At June 30, 2017 and December 31, 2016, the Company maintains its cash and cash
equivalents in banks insured by the Federal Deposit Insurance Corporation (FDIC) in accounts that at times may be
in excess of the federally insured limit of $250,000 per bank. The Company minimizes this risk by placing its cash deposits with
major financial institutions. Investment in Associates An associate is an entity
over which the Company has significant influence through a joint venture. Significant influence is the power to participate in
the financial and operating policy decisions of the investee but not control or joint control over those policies. The results of assets
and liabilities of associates are incorporated in the condensed consolidated financial statements using the equity method of accounting.
Under the equity method, investments in associates are carried in the consolidated balance sheet at cost as adjusted for post-acquisition
changes in the Companys share of the net assets of the associate, less any impairment in the value of the investment. Losses
of an associate in excess of the Companys interest in that associate are not recognized. Additional losses are provided
for, and a liability is recognized, only to the extent that the Company has incurred legal or constructive obligations or made
payments on behalf of the associate. Any excess of the cost
of acquisition over the Companys share of the net fair value of the identifiable assets, liabilities and contingent liabilities
of the associate recognized at the date of acquisition is recognized as goodwill. The goodwill is included within the carrying
amount of the investment. On January 8, 2016, the
Company received 50% ownership in Cure Innovations, Inc (CI). CI was created in 2015 by IncuBrands Studio, Inc (IncuBrands).
The Company and IncuBrands each own 50% of the common stock of CI. The Company and IncuBrands entered into a Joint Venture agreement
in 2013 to distribute several OTF products utilizing IncuBrands marketing and contacts in various industries as well as utilize
the Companys technology and capabilities of manufacturing OTFs. On December 6, 2016,
the Company entered into a Joint Venture Agreement (Joint Venture) with Pace Wellness, Inc. (Pace)
to jointly develop three Active Pharmaceutical Ingredients (API) within the nonprescription and/or Over-the-Counter
(OTC) medicines specifically utilizing the Companys patented and proprietary CureFilm Technology. The three APIs
to be jointly developed are Diphenhydramine HCL, Omeprazole and a third API to be determined at a later date (Products).
Pace shall be the exclusive global distributor of the Products under the Solves Strips® branding or other private or branded
labels. All benefits, advantages, and liabilities derived from, or incurred in respect of the Joint Venture shall be borne by the
parties in proportion of their respective participating interests of 50/50 equal interest. Property and Equipment The Company capitalizes
expenditures related to property and equipment, subject to a minimum rule, that have a useful life greater than one year for: (1)
assets purchased; (2) existing assets that are replaced, improved or the useful lives have been extended; or (3) all land, regardless
of cost. Acquisitions of new assets, additions, replacements and improvements (other than land) costing less than the minimum rule
in addition to maintenance and repair costs, including any planned major maintenance activities, are expensed as incurred. Depreciation
has been provided using the straight-line method on the following estimated useful lives:
Manufacturing equipment 5-7 Years
Computer and other equipment 3-7 Years
Leasehold Improvements Lesser of useful life or the term of the lease Accounts Receivable Accounts receivable are
generally unsecured. The Company establishes an allowance for doubtful accounts receivable based on the age of outstanding invoices
and managements evaluation of collectability. Accounts are written off after all reasonable collection efforts have been
exhausted and management concludes that likelihood of collection is remote. Any future recoveries are applied against the allowance
for doubtful accounts. Impairment of Long-Lived Assets Long-lived assets include
equipment and intangible assets other than those with indefinite lives. We assess the carrying value of our long-lived asset groups
when indicators of impairment exist and recognize an impairment loss when the carrying amount of a long-lived asset is not recoverable
when compared to undiscounted cash flows expected to result from the use and eventual disposition of the asset. Indicators of impairment
include significant underperformance relative to historical or projected future operating results, significant changes in our use
of the assets or in our business strategy, loss of or changes in customer relationships and significant negative industry or economic
trends. When indications of impairment arise for a particular asset or group of assets, we assess the future recoverability of
the carrying value of the asset (or asset group) based on an undiscounted cash flow analysis. If carrying value exceeds projected,
net, undiscounted cash flows, an additional analysis is performed to determine the fair value of the asset (or asset group), typically
a discounted cash flow analysis, and an impairment charge is recorded for the excess of carrying value over fair value. There were
no impairments on our long-lived assets during the three and six month periods ended June 30, 2017 and 2016. Revenue Recognition The Company recognizes
revenue in accordance with the FASB ASC 605, Revenue Recognition. ASC 605 requires that four basic criteria must be met before
revenue can be recognized: (1) persuasive evidence of an arrangement exists; (2) delivery has occurred and/or service has been
performed; (3) the selling price is fixed and determinable; and (4) collectability is reasonably assured. The Company believes
that these criteria are satisfied upon shipment from our facility. Freight billed to customers is presented as revenues, and the
related freight costs are presented as cost of goods sold. Deferred revenue is recognized when earned and all significant obligations
have been satisfied. Advertising Expense The Company expenses
marketing, promotions and advertising costs as incurred. Such costs are included in general and administrative expense in the accompanying
statements of operations. The Company recorded advertising costs of $68,893 and $95,226, for the three and six month periods ended
June 30, 2017, respectively, and none for the three and six month periods ended June 30, 2016. Research and Development Costs incurred in connection
with the development of new products and processes are charged to research and development expenses as incurred. Income Taxes The Company utilizes
FASB ASC 740, 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
tax assets and liabilities are determined based on the difference between the tax basis of assets and liabilities and their financial
reporting amounts based on enacted tax laws and statutory tax rates applicable to the periods in which the differences are expected
to affect taxable income. A valuation allowance is recorded when it is more likely-than-not that a deferred tax asset
will not be realized. The Company generated
a deferred tax asset through net operating loss carry-forward. However, a valuation allowance of 100% has been established due
to the uncertainty of the Companys realization of the net operating loss carry forward prior to its expiration. Stock-Based Compensation Stock-based compensation
is accounted for based on the requirements of the Share-Based Payment Topic of ASC 718 which requires recognition in the consolidated
financial statements of the cost of employee and director services received in exchange for an award of equity instruments over
the period the employee or director is required to perform the services in exchange for the award (presumptively, the vesting period).
The ASC also requires measurement of the cost of employee and director services received in exchange for an award based on the
grant-date fair value of the award. Pursuant to ASC Topic
505-50, for share-based payments to consultants and other third-parties, compensation expense is determined at the measurement
date. The expense is recognized over the vesting period of the award. Until the measurement date is reached, the total amount
of compensation expense remains uncertain. The Company initially records compensation expense based on the fair value of the award
at the reporting date. Fair Value Measurements The Company adopted the
provisions of ASC Topic 820, Fair Value Measurements and Disclosures, which defines fair value as used in numerous
accounting pronouncements, establishes a framework for measuring fair value and expands disclosure of fair value measurements. The estimated fair value
of certain financial instruments, including cash and cash equivalents are carried at historical cost basis, which approximates
their fair values because of the short-term nature of these instruments. ASC 820 defines fair
value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal
or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement
date. ASC 820 also establishes a fair value hierarchy, which requires an entity to maximize the use of observable inputs and minimize
the use of unobservable inputs when measuring fair value. ASC 820 describes three levels of inputs that may be used to measure
fair value: Level 1 quoted prices in
active markets for identical assets or liabilities Level 2 quoted prices for
similar assets and liabilities in active markets or inputs that are observable Level 3 inputs that are
unobservable (for example cash flow modeling inputs based on assumptions) The Company has assets
or liabilities valued at fair value on a recurring basis for the six months ended June 30, 2017. The Company did not have assets
or liabilities valued at fair value on a recurring basis for the year ended December 31, 2016. Basic and diluted loss per share Basic loss per share
is computed by dividing the net loss to common stockholders for the period by the weighted average number of common shares outstanding
during the period. Diluted loss per share is computed by dividing the net loss for the period by the weighted average number of
common and dilutive common equivalent shares outstanding during the period. Common equivalent shares, which consist of stock options,
warrants, and convertible notes payable, have been excluded from the diluted loss per share calculation because their effect is
anti-dilutive. Going Concern The Companys financial
statements are prepared using U.S. GAAP applicable to a going concern, which contemplates the realization of assets and liquidation
of liabilities in the normal course of business. The Company had an accumulated deficit at June 30, 2017 of $15,880,139. The Company
had a working capital of $221,888 as of June 30, 2017. These factors raise substantial doubt about the Companys ability
to continue as a going concern for one year from the issuance of the financial statements. The ability of the Company to continue
as a going concern is dependent on the Company obtaining adequate capital to fund operating losses until it establishes a revenue
stream and becomes profitable. The Company is continually analyzing its current costs and is attempting to make additional cost
reductions where possible. We expect that we will continue to generate losses from operations throughout 2017. In order to continue
as a going concern and to develop a reliable source of revenues, and achieve a profitable level of operations the Company will
need, among other things, additional capital resources. Managements plans to continue as a going concern include raising
additional capital through borrowing and/or sales of equity and debt securities. However, management cannot provide any assurances
that the Company will be successful in accomplishing any of its plans. The ability of the Company
to continue as a going concern is dependent upon its ability to successfully accomplish the plans described in the preceding paragraph
and eventually secure other sources of financing and attain profitable operations. The accompanying consolidated financial statements
do not include any adjustments relating to the recoverability and classification of assets and liabilities that might be necessary
if the Company is unable to continue as a going concern. Recently Issued Standards In January 2016, the
FASB issued ASU 2016-01, Recognition and Measurement of Financial Assets and Financial Liabilities. The purpose is to enhance the
reporting model for financial instruments to provide users of financial statements with more decision-useful information. This
ASU is effective for the Company in the first quarter of 2018. Early adoption is not permitted except for limited provisions. The
Company does not expect the adoption of this amendment to have a material effect on its financial condition and results of operations. In March 2016, the FASB
issued ASU No. 2016-09, Compensation-Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting. The
new standard requires recognition of the income tax effects of vested or settled awards in the income statement and involves several
other aspects of the accounting for share-based payment transactions, including the income tax consequences, classification of
awards as either equity or liabilities and classification on the statement of cash flows. This new standard became effective for
the Company on January 1, 2017. The adoption of this standard did not have a material impact on its financial position, results
of operations or statements of cash flows upon adoption. In August, 2016, the
FASB issued Accounting Standards Update No. 2016-15, Classification of Certain Cash Receipts and Cash Payments (a consensus of
the Emerging Issues Task Force) (ASU 2016-15). The amendments in ASU 2016-15 address eight specific cash flow issues
and apply to all entities that are required to present a statement of cash flows under ASC Topic 230, Statement of Cash Flows.
The amendments in ASU 2016-15 are effective for public business entities for fiscal years beginning after December 15, 2017, and
interim periods within those fiscal years. Early adoption is permitted, including adoption during an interim period. The Company
has not yet completed the analysis of how adopting this guidance will affect its consolidated financial statements. In January 2017, the
FASB issued ASU No. 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business. This new standard clarifies
the definition of a business and provides a screen to determine when an integrated set of assets and activities is not a business.
The screen requires that when substantially all of the fair value of the gross assets acquired (or disposed of) is concentrated
in a single identifiable asset or a group of similar identifiable assets, the set is not a business. This new standard will be
effective for the Company on January 1, 2018; however, early adoption is permitted with prospective application to any business
development transaction. In May 2017, the FASB
issued ASU No. 2017-09, Compensation-Stock Compensation: Scope of Modification Accounting, There are various other
updates recently issued, most of which represented technical corrections to the accounting literature or application to specific
industries and are not expected to a have a material impact on the Companys financial position, results of operations or
cash flows. |
