nDivision (NDVNQ) 10-Q 12 Nov 19 2019 Q3 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	9 Months Ended
	Sep. 30, 2019	Nov. 11, 2019
Document And Entity Information
Entity Registrant Name	nDivision Inc.
Entity Central Index Key	0001659183
Document Type	10-Q
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Small Business	true
Entity Shell Company	false
Entity Emerging Growth Company	true
Entity Current Reporting Status	Yes
Document Period End Date	Sep. 30, 2019
Entity Filer Category	Non-accelerated Filer
Document Fiscal Period Focus	Q3
Document Fiscal Year Focus	2019
Entity Ex Transition Period	false
Entity Common Stock Shares Outstanding		41,249,783

CONDENSED CONSOLDIATED BALANCE

CONDENSED CONSOLDIATED BALANCE SHEETS - USD ($)	Sep. 30, 2019	Dec. 31, 2018
Current assets
Cash	$ 177,146	$ 154,941
Accounts receivable, net (allowance for doubtful accounts was $17,026 at September 30, 2019 and $0 at December 31, 2018)	601,663	478,174
Prepaid expenses	186,608	72,974
Total current assets	965,417	706,089
Equipment and software licenses - at cost, less accumulated depreciation and amortization	284,755	497,833
Intangible asset, less accumulated amortization	708,508	860,422
Total assets	1,958,680	2,064,344
Current liabilities
Accounts payable	131,021	131,850
Accrued liabilities	557,214	538,783
Deferred revenue	406,295
Factoring credit facility	174,479	169,257
Note payable		13,358
Current portion of long-term debt	56,627	113,598
Current portion of finance lease obligations	187,915	392,200
Total current liabilities	1,513,551	1,359,046
Acquisition note payable	29,904	77,579
Finance lease obligations	29,115	36,654
Total long-term liabilities	59,019	114,233
Commitments and Contingencies
Stockholder's equity
Preferred stock, $0.001 par value, 20,000,000 shares authorized, no shares issued and outstanding
Common stock, $0.001 par value, 180,000,000 shares authorized, and 41,138,672 and 40,504,005 shares issued and outstanding, respectively	41,139	40,504
Additional paid in capital	5,842,081	5,184,493
Accumulated deficit	(5,497,110)	(4,633,932)
Total stockholder's equity	386,110	591,065
Total liabilities and stockholder's equity	$ 1,958,680	$ 2,064,344

CONDENSED CONSOLDIATED BALANC_2

CONDENSED CONSOLDIATED BALANCE SHEETS (Parenthetical) - USD ($)	Sep. 30, 2019	Dec. 31, 2018
Current assets
Allowance for doubtful debts	$ 17,026	$ 0
Stockholder's equity
Preferred stock, shares par value	$ 0.001	$ 0.001
Preferred stock, shares authorized	20,000,000	20,000,000
Preferred stock, shares issued
Preferred stock, shares outstanding
Common stock, shares par value	$ 0.001	$ 0.001
Common stock, shares authorized	180,000,000	180,000,000
Common stock, shares issued	41,138,672	40,504,005
Common stock, shares outstanding	41,138,672	40,504,005

CONDENSED CONSOLIDATED STATEMEN

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Revenue
Product sales				$ 67,624
Service revenue	1,416,432	1,142,226	4,257,662	2,961,787
Net revenues	1,416,432	1,142,226	4,257,662	3,029,411
Product costs				32,315
Service costs	302,350	269,870	840,496	806,618
Cost of revenues	302,350	269,870	840,496	838,933
Gross profit	1,114,082	872,356	3,417,166	2,190,478
Operating expenses
Selling, general and administrative expenses	1,451,767	1,365,158	4,259,770	4,081,882
Change in contingent consideration			(30,757)
Total operating expenses	1,451,767	1,365,158	4,229,013	4,081,882
Loss from operations	(337,685)	(492,802)	(811,847)	(1,891,404)
Other expense
Interest expense	(18,891)	(24,383)	(51,331)	(64,600)
Other expense	(18,891)	(24,383)	(51,331)	(64,600)
Net loss before income tax	(356,576)	(517,185)	(863,178)	(1,956,004)
Income tax expense
Net loss	$ (356,576)	$ (517,185)	$ (863,178)	$ (1,956,004)
Basic and diluted loss per share	$ (0.01)	$ (0.01)	$ (0.02)	$ (0.05)
Weighted average shares outstanding	41,138,672	39,731,671	40,944,171	37,689,173

CONDENSED CONSOLIDATED STATEM_2

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (Unaudited) - USD ($)	Total	Common Stock [Member]	Additional Paid-in Capital [Member]	Accumulated Deficit [Member]
Balance, shares at Dec. 31, 2017		27,500,000
Balance, Amount at Dec. 31, 2017	$ (646,650)	$ 27,500	$ 1,566,161	$ (2,240,311)
Adjustment for reverse acquisition, Shares		4,400,000
Adjustment for reverse acquisition, Amount	$ (13,885)	$ 4,400	(18,285)
Net Income (Loss)	(744,409)			(744,409)
Amortization of stock option and warrant expense	$ 121,923		121,923
Common stock issued for services, Shares		13,158
Common stock issued for services, Amount	$ 5,000	$ 13	4,987
Warrant issued for acquisition of contracts	$ 21,158		21,158
Common stock issued for cash, net, Shares		7,676,846
Common stock issued for cash, net, Amount	$ 2,873,888	$ 7,677	$ 2,866,211
Balance, shares at Mar. 31, 2018		39,590,004
Balance, amount at Mar. 31, 2018	$ 1,617,025	$ 39,590	$ 4,562,155	$ (2,984,720)
Net Income (Loss)	(694,411)			$ (694,411)
Amortization of stock option and warrant expense	$ 101,574		$ 101,574
Balance, shares at Jun. 30, 2018		39,590,004
Balance, amount at Jun. 30, 2018	$ 1,024,188	$ 39,590	$ 4,663,729	$ (3,679,131)
Net Income (Loss)	(517,185)			$ (517,185)
Amortization of stock option and warrant expense	$ 89,260		89,260
Common stock issued for cash, net, Shares		380,001
Common stock issued for cash, net, Amount	$ 142,120	$ 380	$ 141,740
Balance, shares at Sep. 30, 2018		39,970,005
Balance, amount at Sep. 30, 2018	$ 738,383	$ 39,970	$ 4,894,729	$ (4,196,316)
Balance, shares at Dec. 31, 2018		40,504,005
Balance, Amount at Dec. 31, 2018	$ 591,065	$ 40,504	$ 5,184,493	$ (4,633,932)
Net Income (Loss)	(165,072)			$ (165,072)
Amortization of stock option	$ 114,321		114,321
Common stock issued for cash, net, Shares		101,334
Common stock issued for cash, net, Amount	$ 38,000	$ 101	$ 37,899
Balance, shares at Mar. 31, 2019		40,605,339
Balance, amount at Mar. 31, 2019	$ 578,314	$ 40,605	$ 5,336,713	$ (4,799,004)
Net Income (Loss)	(341,530)			$ (341,530)
Amortization of stock option	$ 156,466		156,466
Common stock issued for cash, net, Shares		533,333
Common stock issued for cash, net, Amount	$ 200,000	$ 534	$ 199,466
Balance, shares at Jun. 30, 2019		41,138,672
Balance, amount at Jun. 30, 2019	$ 593,250	$ 41,139	$ 5,692,645	$ (5,140,534)
Net Income (Loss)	(356,576)			$ (356,576)
Amortization of stock option	$ 149,436		$ 149,436
Balance, shares at Sep. 30, 2019		41,138,672
Balance, amount at Sep. 30, 2019	$ 386,110	$ 41,139		$ (5,497,110)

CONDENSED CONSOLIDATED STATEM_3

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOW (Unaudited) - USD ($)	9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018
Cash flows from operating activities
Net loss	$ (863,178)	$ (1,956,004)
Adjustments to reconcile net loss to net cash provided (used) in operating activities
Depreciation and amortization	397,512	417,269
Provision for doubtful accounts	22,413
Stock based compensation	420,223	312,757
Gain on sale of assets	(12,213)
Stock issued for services		5,000
Change in contingent consideration	(30,757)
Changes in assets and liabilities
Accounts receivable	(145,902)	(26,087)
Prepaid expenses	11,303	(54,426)
Deferred revenue	406,295
Accounts payable and accrued liabilities	17,602	(580,701)
Net cash provided by (used in) operating activities	223,298	(1,882,192)
Cash flows from investing activities
Acquisition of contracts		(813,855)
Repayment of debt related to acquisition	(73,889)
Proceeds from sale of equipment and software license	31,699
Acquisition of equipment and software licenses	(2,382)	(26,365)
Net cash used in investing activities	(44,572)	(840,220)
Cash flows from financing activities
Lines of credit, net		(92,075)
Proceeds from issuance of common stock, net	238,000	3,016,008
Proceeds of factor credit facility	5,222	144,439
Repayments of loans from officers		(137,000)
Repayments of note payable	(13,358)	(24,367)
Repayment of finance lease obligations	(386,385)	(260,432)
Net cash (used in) provided by financing activities	(156,521)	2,646,573
Net increase (decrease) in cash	22,205	(75,839)
Cash, beginning of period	154,941	127,933
Cash, end of period	177,146	52,094
Supplemental cash flow disclosures
Interest paid	51,333	52,437
Non-cash financing activities
Consideration for the purchase of contracts		212,335
Purchase of capital lease	$ 49,624

DESCRIPTION OF BUSINESS

DESCRIPTION OF BUSINESS	9 Months Ended
	Sep. 30, 2019
DESCRIPTION OF BUSINESS
1. DESCRIPTION OF BUSINESS	nDivision Inc ("nDivision" or the "Company") was incorporated under the laws of the state of Texas. nDivision's registered office is located at 4925 Greenville Avenue, Dallas, Texas 75206. The Company provides managed IT services and project-based professional services in the information technology industry, selling its services directly to customers and through global service providers (GSP). The Company operates in most states of the United States of America. On February 13, 2018, Go2Green Landscaping, Inc., a Nevada corporation (the "Registrant") executed an Agreement and Plan of Merger (the "Merger Agreement") with nDivision Inc, and NDI Acquisition Corp., a Delaware corporation and wholly-owned subsidiary of the Registrant ("Acquisition") whereby Acquisition was merged with and into nDivision (the "Merger") in consideration for Twenty Seven Million Five Hundred Thousand (27,500,000) newly-issued shares of Common Stock of the Company (the "Merger Shares"). As a result of the Merger, nDivision became a wholly-owned subsidiary of the Registrant and following the consummation of the Merger and giving effect to the issuance of the Merger Shares and the retirement of 10,000,000 shares of the then 14,400,000 shares issued and outstanding of the Registrant by its principal stockholders, the stockholders of nDivision beneficially owned approximately seventy percent (70%) of the issued and outstanding Common Stock of the Registrant. For accounting purposes, nDivision was deemed to be the accounting acquirer in the transaction and, consequently, the transaction was treated as a recapitalization of the Company. Accordingly, nDivision's assets, liabilities and results of operations are the historical consolidated financial statements of the Company and the Company's assets, liabilities and results of operations are consolidated with nDivision effective as of the date of the Merger. No step-up in basis or intangible assets or goodwill was recorded in this transaction. On February 26, 2018, the Company executed an Asset Purchase Agreement (the "Agreement") with Gamwell Technologies Inc., a Texas corporation ("Gamwell"). Gamwell is engaged in the business of providing managed services, VIOP telephone, security consulting and professional services to its customers. As a result of the Agreement, nDivision acquired various managed services contracts (the "Purchased Contracts") from Gamwell. As consideration for the Purchased Contracts, nDivision paid $800,000 (the "Cash Consideration") to Gamwell. In addition, Gamwell received a promissory note (the "Promissory Note") in an amount that equals fourteen (14) multiplied by the closing monthly recurring revenue from managed services. The Promissory Note is currently estimated at approximately $191,177 based on the closing monthly recurring revenue. Gamwell also received warrants (the "Warrants") to purchase common stock of the Company equal to one fourth percent (0.25%) of the outstanding stock of the Company as of the agreement date. The Warrants were valued at approximately $21,158. The consideration for the contracts purchased was approximately $1,012,335. The Cash Consideration, Promissory Note and Warrants shall be defined as the "Purchase Price" and can be adjusted after one year, based on the newly calculated monthly recurring revenue. The Company calculated an approximate 3% decline in the purchased contracts monthly recurring revenue and recognized a gain in contingent consideration of $30,757 and reduced the loan $30,757. Since February 13, 2018, the Company has sold 9,336,625 shares of the Registrant's common shares at approximately $0.375 - $0.45 per share for $3,503,738. There were no material fees paid in association with these shares being sold. On April 9, 2018, the parent company Go2Green Landscaping, Inc. changed its name to nDivision Inc. and changed the ticker symbol to NDVN.

LIQUIDITY AND GOING CONCERN

LIQUIDITY AND GOING CONCERN	9 Months Ended
	Sep. 30, 2019
LIQUIDITY AND GOING CONCERN
2. LIQUIDITY AND GOING CONCERN	The Company has experienced significant losses and negative cash flows from operations in the past. Management has secured new managed services contracts, implemented a strategy which includes cost reduction efforts, as well as identifying strategic acquisitions to improve the overall profitability and cash flows of the Company. During the nine months ended September 30, 2019, the Company sold 634,667 shares of common stock at a price of approximately $0.375 per share for $238,000. The Company has entered into a factoring agreement to provide short term working capital. The Company receives 90% of the factored receivables for a fee of 1.9% of the factored invoice. As of November 11, 2019, the Company approximately $163,000 of factored invoices. The ability to continue as a going concern is dependent upon the Company generating profitable operations in the future and/or obtaining the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they come due. Management intends to finance operating costs over the next twelve months from the date of the issuance of these condensed consolidated financial statements with existing cash on hand and/or the private placement of common stock. There is, however, no assurance that the Company will be able to raise any additional capital through any type of offering on terms acceptable to the Company, as existing cash on hand will be insufficient to finance operations over the next twelve months.

SUMMMARY OF SIGNIFICANT ACCOUNT

SUMMMARY OF SIGNIFICANT ACCOUNTING POLICIES	9 Months Ended
	Sep. 30, 2019
SUMMMARY OF SIGNIFICANT ACCOUNTING POLICIES
3. SUMMMARY OF SIGNIFICANT ACCOUNTING POLICIES	Basis of Presentation The accompanying unaudited condensed consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and with the instructions to Article 8 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America for complete consolidated financial statements. In the opinion of management, all adjustments considered necessary for a fair presentation have been included. Operating results for the three and nine month periods ended September 30, 2019 are not necessarily indicative of the results that may be expected for the year ending December 31, 2019. The unaudited condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and footnotes thereto included in the Company's Form 10-K filed on March 29, 2019 from which the accompanying December 31, 2018 numbers are derived. Principles of Consolidation The unaudited condensed consolidated financial statements include the accounts and transactions of the Company and its wholly owned subsidiary, Vi3 Technologies, Inc. All significant inter-company accounts and transactions are eliminated in consolidation. Use of Estimates Management uses estimates and assumptions in preparing these unaudited condensed consolidated financial statements. Those estimates and assumptions affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities, and the reported revenues and expenses. Actual results could differ from those estimates. Revenue Recognition Topic ASC 606 is effective as of the annual reporting period beginning after December 15, 2017 using either of two methods: (1) retrospective application of Topic ASC 606 to each prior reporting period presented with the option to elect certain practical expedients as defined within Topic ASC 606 or (2) retrospective application of Topic ASC 606 with the cumulative effect of initially applying Topic ASC 606 recognized at the date of initial application and providing certain additional disclosures as defined per Topic ASC 606. We adopted Topic ASC 606 pursuant to the method (2) and we determined that any cumulative effect for the initial application did not require an adjustment to retained earnings at January 1, 2018. For revenue recognition arrangements that we determine are within the scope of Topic ASC 606, we perform the following five steps: (i) identify the contract(s) with a customer, (ii) identify the performance obligations in the contract, (iii) determine the transaction price, (iv) allocate the transaction price to the performance obligations in the contract, and (v) recognize revenue when (or as) the entity satisfies a performance obligation. We only apply the five-step model to arrangements that meet the definition of a contract under Topic 606, including when it is probable that the entity will collect the consideration it is entitled to in exchange for the goods or services it transfers to the customer. At contract inception, once the contract is determined to be within the scope of Topic 606, we evaluate the goods or services promised within each contract related performance obligation and assess whether each promised good or service is distinct. We then recognize as revenue the amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied. We recognize revenue upon completion of our performance obligations or expiration of the contractual time to use services. Cash and Cash Equivalents For purposes of the condensed consolidated statements of cash flows, the Company considers all highly liquid investments with a maturity of three months or less when purchased to be cash equivalents. The Company’s cash balances are primarily maintained at two separate banks. Balances are insured by the Federal Deposit Insurance Corporation subject to certain limitations. Accounts Receivable Accounts receivable are stated at the amount management expects to collect. An allowance for doubtful accounts is recorded, as a charge to bad debt expense, where collection is considered to be doubtful due to credit issues. These allowances together reflect the Company’s estimate of potential losses inherent in accounts receivable balances, based on historical loss and known factors impacting its customers. The Company recorded an allowance for doubtful accounts of $17,026 and $0 as of September 30, 2019 and December 31, 2018, respectively. The Company does not accrue interest on past due receivables. Intangible Assets Customer contracts acquired were recorded at their estimated fair value at the date of acquisition and are being amortized over their estimated useful life of five years using the straight-line method. Impairment of Long-lived Assets The Company records an impairment of long-lived assets used in operations, other than goodwill, when events or circumstances indicate that the asset might be impaired and the estimated undiscounted cash flows to be generated by those assets over their remaining lives are less than the carrying amount of those items. The net carrying value of assets not recoverable is reduced to fair value, which is typically calculated using the discounted cash flow method. The Company did not record any impairment during the nine months ended September 30, 2019 and September 30, 2018. Concentration of Risk Financial instruments, which potentially subject the Company to concentrations of credit risk, are cash and accounts receivable. See Note 15 for significant customer concentration disclosure. Cash is maintained with two separate major financial institutions in the United States and may exceed the amount of insurance provided on such deposits. Generally, these deposits may be redeemed upon demand, and, therefore, bear minimal risk. Equipment and Software Licenses Equipment and software licenses are stated at cost. Depreciation is calculated using the straight-line method over an estimated useful life of one to ten years. Earnings and Loss per Share Basic loss per share is computed by dividing net loss attributable to common stockholders by the weighted average common shares outstanding for the period. Diluted loss per share is computed giving effect to all potentially dilutive common shares. Potentially dilutive common shares may consist of incremental shares issuable upon the exercise of stock options and warrants and the conversion of notes payable to common stock. In periods in which a net loss has been incurred, all potentially dilutive common shares are considered anti-dilutive and thus are excluded from the calculation. There were approximately 9,139,000 and 8,142,000 of common stock equivalents excluded for the three and nine months ended September 30, 2019 and 2018, respectively because their effect is anti-dilutive. Marketing Costs Marketing costs, which are expensed as incurred, totaled approximately $29,192 and $84,214 and $687 and $11,341 for the three and nine months ended September 30, 2019 and 2018, respectively and is included in selling, general and administrative expenses. Stock-Based Compensation Compensation expense related to share-based transactions, including employee stock options, is measured in the financial statements based on a determination of the fair value. The grant date fair value is determined using the Black-Scholes-Merton (“Black-Scholes”) pricing model. For all stock options, the Company recognizes expense over the requisite service period on a straight-line basis (generally the vesting period of the equity grant). The Company’s option pricing model requires the input of highly subjective assumptions, including the expected stock price volatility and expected term. Any changes in these highly subjective assumptions significantly impact stock-based compensation expense. See Note 11 for the assumptions used to calculate the fair value of stock-based employee and non-employee compensation. Leases Leases of assets where the Company has assumed substantially all the risks and rewards of ownership are classified as finance leases. Finance leases are recognized at the lower of the fair value of the leased assets and the present value of the minimum lease payments. The interest element of the finance leases are accounted for as finance costs and expensed over the lease term using the effective interest rate method. Income Taxes The Company accounts for income taxes under the asset and liability method, 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. Under this method, the Company has determined the deferred tax assets and liabilities on the basis of the differences between the financial statement and tax basis of assets and liabilities by using enacted tax rates in effect for the year in which the differences are expected to reverse. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period that includes the enactment date. The Company recognizes deferred tax assets to the extent that it believes that these assets are more likely than not to be realized. In making such a determination, the Company considers all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax-planning strategies, and results of recent operations. If the Company determines that it would be able to realize our deferred tax assets in the future in excess of their net recorded amount, it would make an adjustment to the deferred tax asset valuation allowance, which would reduce the provision for income taxes. The Company records uncertain tax positions in accordance with ASC 740 on the basis of a two-step process in which (1) it determines whether it is more likely than not that the tax positions will be sustained on the basis of the technical merits of the position and (2) for those tax positions that meet the more-likely-than-not recognition threshold, it recognizes the largest amount of tax benefit that is more than 50 percent likely to be realized upon ultimate settlement with the related tax authority. The Company recognizes interest and penalties related to unrecognized tax benefits on the income tax expense line in the accompanying consolidated statement of operations. As of September 30, 2019, no accrued interest or penalties are included on the related tax liability line in the balance sheet.

RECENT ACCOUNTING PRONOUNCEMENT

RECENT ACCOUNTING PRONOUNCEMENTS	9 Months Ended
	Sep. 30, 2019
RECENT ACCOUNTING PRONOUNCEMENTS
4. RECENT ACCOUNTING PRONOUNCEMENTS	New Accounting Pronouncements Recently Adopted In February 2016, FASB issued ASU No. 2016-02, Leases (Topic 842), which supersedes the existing guidance for lease accounting, Leases (Topic 840). ASU 2016-02 requires lessees to recognize leases on their balance sheets, and leaves lessor accounting largely unchanged. The amendments in this ASU are effective for fiscal years beginning after December 15, 2018 and interim periods within those fiscal years. Early application is permitted for all entities. ASU 2016-02 requires a modified retrospective approach for all leases existing at, or entered into after, the date of initial application, with an option to elect to use certain transition relief. In July 2018, the FASB issued ASU No. 2018-10, “Codification Improvements to Topic 842, Leases.” The amendments in ASU 2018-10 clarify, correct or remove inconsistencies in the guidance provided under ASU 2016-02 related to sixteen specific issues identified. Also in July 2018, the FASB issued ASU No. 2018-11 “Leases (Topic 842): Targeted Improvement” which now allows entities the option of recognizing the cumulative effect of applying the new standard as an adjustment to the opening balance of retained earnings in the year of adoption while continuing to present all prior periods under previous lease accounting guidance. The effective date and transition requirements for these two ASUs are the same as the effective date and transition requirements as ASU 2016-02. The Company recognized no right-of-use assets or corresponding liabilities as a result of this guidance, since the Company was not party to any leases with a term of more than 12 months at January 1, 2019. In January 2017, the FASB issued ASU 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business, which clarifies the definition of a business to assist entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. The standard became effective for the Company in the first quarter of 2019. The adoption of this standard does not have a material impact on the condensed consolidated financial statements. In June 2018, the FASB issued ASU 2018-07, which simplifies the accounting for non-employee share-based payment transactions. The amendments specify that Topic 718 applies to all share-based payment transactions in which a grantor acquires goods or services to be used or consumed in a grantor's own operations by issuing share-based payment awards. The standard became effective in the first quarter of fiscal year 2019. The adoption of this standard does not have a material impact on the condensed consolidated financial statements. New Accounting Pronouncements Not Yet Adopted In January 2017, the FASB issued ASU 2017-04, "Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment". The update simplifies how an entity is required to test goodwill for impairment by eliminating Step 2 from the goodwill impairment test. Step 2 measures a goodwill impairment loss by comparing the implied fair value of a reporting unit's goodwill with the carrying amount. The new rules will be effective for the Company in the first quarter of 2021. Early adoption is permitted. The Company is currently evaluating the impact of adopting this ASU on its consolidated financial statements. No other recent accounting pronouncements were issued by FASB and the SEC that are believed by management to have a material impact on the Company's present or future condensed consolidated financial statements.

EQUIPMENT AND SOFTWARE LICENSES

EQUIPMENT AND SOFTWARE LICENSES	9 Months Ended
	Sep. 30, 2019
EQUIPMENT AND SOFTWARE LICENSES
5. EQUIPMENT AND SOFTWARE LICENSES	Equipment and software licenses consist of the following: September 30, December 31, 2019 2018 Equipment and software $ 717,063 $ 1,124,245 Software licenses 912,164 966,754 1,629,227 2,090,999 Less - Accumulated depreciation and amortization (1,344,472 ) (1,593,166 ) $ 284,755 $ 497,833 During the nine-month period ended September 30, 2019, the Company disposed of $513,778 of equipment and software and related accumulated depreciation of $494,292, for proceeds of $31,699 which resulted in a gain $12,213. Depreciation and amortization expense for the three and nine months ended September 30, 2019 and 2018 was approximately $76,832 and $245,599 and $101,318 and $315,994, respectively.

INTANGIBLE ASSETS

INTANGIBLE ASSETS	9 Months Ended
	Sep. 30, 2019
INTANGIBLE ASSETS
6. INTANGIBLE ASSETS	Intangible Assets As of September 30, 2019 (In Thousands) Cost Accumulated Amortization Net Book Value Customer Relationships / Service Contracts $ 1,012,335 $ (303,827 ) $ 708,508 There was approximately $50,638 and $151,913 amortized for the three and nine month periods ended September 30, 2019, respectively. There was approximately $50,638 and $101,276 for the three and nine month periods ended September 30, 2018, respectively. Customer relationships are amortized based on the future undiscounted cash flows or straight – line basis over estimated remaining useful lives of five years. Over the next five years, annual amortization expense for these finite life intangible assets will total approximately $708,508 as follows: remainder of 2019 - $50,637, fiscal 2020 - $202,551, fiscal 2021 - $202,551, fiscal 2022 - $202,551, fiscal 2023 - $50,218. Long-lived assets, including purchased intangibles subject to amortization, are reviewed for impairment when events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The Company regularly evaluates whether events and circumstances have occurred that indicate possible impairment and relies on a number of factors, including operating results, business plans, economic projections, and anticipated future cash flows. The Company uses an estimate of the future undiscounted net cash flows of the related asset or asset group over the remaining life in measuring whether the assets are recoverable, as of September 30, 2019, the Company has not recorded any impairments.

ACCRUED LIABILITIES

ACCRUED LIABILITIES	9 Months Ended
	Sep. 30, 2019
ACCRUED LIABILITIES
7. ACCRUED LIABILITIES	September 30, December 31, 2019 2018 Accrued compensation $ 194,087 $ 156,139 Accrued sales tax 144,289 149,821 Accrued franchise tax 4,745 35,000 Accrued professional fees and other payables 214,093 197,823 Total accrued liabilities $ 557,214 $ 538,783

FACTORING CREDIT FACILITY

FACTORING CREDIT FACILITY	9 Months Ended
	Sep. 30, 2019
FACTORING CREDIT FACILITY
8. FACTORING CREDIT FACILITY	The Company has agreements with an unrelated third party for factoring of specific accounts receivable. Under this arrangement, the Company has transferred the relevant receivables to the factor in exchange for cash and is prevented from selling or pledging the receivables. The agreement provides for an advanced rate of 90% with a fee of 1.9% to be charged on the gross face amount of the invoices purchased for 30 days, and an additional. 0.06% charge for each additional day until the invoice(s) are paid. The Company has retained late payment and credit risk related to the factored receivables and therefore continues to recognize the factored receivables in their entirety on its balance sheet. The receivables under factoring arrangements are recorded within accounts receivable and factoring credit facility. The balance of the accounts receivable amount factored, and the related factor payable are $174,479 and $169,257 as of September 30, 2019 and December 31, 2018, respectively. The Company has recognized $9,245 and $16,728 and $6,897 and $6,897 in interest expense related to these arrangements for the three and nine months ended September 30, 2019 and 2018, respectively.

NOTES PAYABLE

NOTES PAYABLE	9 Months Ended
	Sep. 30, 2019
NOTES PAYABLE
9. NOTES PAYABLE	September 30, December 31, 2019 2018 The Company obtained an $85,670 promissory note with a maturity date of June 30, 2019, an interest rate of 6%, which is repayable in monthly installments of principal and interest of $2,270. The note is unsecured. The note has been fully repaid as of September 30, 2019. $ - $ 13,358

FINANCE LEASE OBLIGATIONS

FINANCE LEASE OBLIGATIONS	9 Months Ended
	Sep. 30, 2019
FINANCE LEASE OBLIGATIONS
10. FINANCE LEASE OBLIGATIONS	The Company finances certain property and equipment using finance leases. These leases range from one to five years. The finance lease obligations represent the present value of the minimum lease payments, net of imputed interest. The finance lease obligations are secured by the underlying leased assets. Leases are payable in monthly installments ranging from $90 to $16,824 including interest, ranging from 3.6% to 55.9% per annum. Future minimum lease payments, including principal and interest, under the finance leases for subsequent years are as follows: Year ended Remainder of 2019 $ 66,306 2020 137,682 2021 20,716 2022 4,682 Total 229,386 Less: interest and sales tax (12,356 ) Present value of net minimum lease payments 217,030 Short term 187,915 Long term total $ 29,115 Lease payments for the three and nine months ended September 30, 2019 and 2018 aggregated approximately $123,111 and $386,385 and $169,538 and $260,432, respectively. The finance lease obligations are secured by underlying leased assets with a net book value of approximately $270,264 and $540,695 as of September 30, 2019 and 2018, respectively. The Company adopted ASU 2016-02 using a retrospective adoption method at January 1, 2019 as noted in Note 4. “New Accounting Pronouncements”. As required, the following disclosure is provided for periods prior to adoption. Minimum lease commitments as of December 31, 2018 that have an initial or remaining lease term in excess of one year are as follows: Finance Leases 2019 $ 380,249 2020 46,589 2021 2,021 Total $ 428,859

STOCK BASED COMPENSATION

STOCK BASED COMPENSATION	9 Months Ended
	Sep. 30, 2019
STOCK BASED COMPENSATION
11. STOCK BASED COMPENSATION	The Board of Directors approved the Company’s 2018 Equity Incentive Plan (the “2018 Plan”). The purpose of the 2018 Plan is to provide additional incentives to select persons who can make, are making, and continue to make substantial contributions to the growth and success of the Company, to attract and retain the employment and services of such persons, and to encourage and reward such contributions, by providing these individuals with an opportunity to acquire or increase stock ownership in the Company through either the grant of options or restricted stock. The 2018 Plan is administered by the Compensation Committee or such other committee as is appointed by the Board of Directors pursuant to the 2018 Plan (the “Committee”). The Committee has full authority to administer and interpret the provisions of the 2018 Plan including, but not limited to, the authority to make all determinations with regard to the terms and conditions of an award made under the 2018 Plan. The maximum number of shares that may be granted under the 2018 Plan is 8,000,000. This number is subject to adjustment to reflect changes in the capital structure or organization of the Company. The following table reflects the stock options for the nine months ended September 30, 2019: A summary of stock option activity is as follows: Number of options outstanding: Beginning of year 5,901,678 Granted 1,325,000 Exercised, converted - Forfeited / exchanged / modification (287,500 ) September 30, 2019 6,939,178 Number of options exercisable at end of period 3,158,078 Number of options available for grant at end of period 1,060,823 Weighted average option prices per share: Granted during the period $ 0.61 Exercised during the period - Terminated during the period $ 0.38 Outstanding at end of the period $ 0.45 Exercisable at end of year $ 0.39 Stock-based compensation expense attributable to stock options was $149,436 and $420,223 for the three and nine month periods ended September 30, 2019. As of September 30, 2019, there was approximately $1,101,368 of unrecognized compensation expense related to unvested stock options outstanding, and the weighted average vesting period for those options was 3 years. The Company granted options to purchase 1,325,000 shares of common stock with an average vesting period of 3 years, an average expected life of 6.5 years and an average exercise price of $0.61 per common share. Total value was approximately $755,000. 2019 2018 Expected option life (years) 6.5 6.5 Expected stock price volatility 137-145 % 51-135 % Expected dividend yield — % — % Risk-free interest rate 2.40-2.90 % 2.00 % The Company issued approximately 2,200,000 warrants related to three consulting agreements during the period ended September 30, 2018 and did not issue any warrants during the period ended September 30, 2019. The fair value of the warrants granted was approximately $61,780 for the period ended September 30, 2018. The compensation was recognized as stock compensation expense in the nine months ended September 30, 2018 as the warrants are immediately exercisable, regardless of the service period of the consulting agreements. This estimate was made using the Black-Scholes option pricing model using the weighted average assumptions detailed below.

COMMON STOCK

COMMON STOCK	9 Months Ended
	Sep. 30, 2019
COMMON STOCK
12. COMMON STOCK	During the nine months ended September 30, 2018 and September 30, 2019, the Company issued the following stock: 2018 Issued approximately 4,400,000 common shares and the assumed liabilities of approximately $13,885 in connection with the reverse acquisition. Issued approximately 13,158 common shares for services provided to the Company during the period ended September 30, 2018. The services provided was valued at approximately $5,000. Issued 8,056,847 shares of common stock and received approximately $3,016,008 with no material fees. In connection with the issuance of the common shares during the three months ended, September 30, 2018 the Company issued a warrant to purchase up to 750,000 shares of the Company’s common stock at a price of $0.625 for one year. 2019 Issued 101,334 shares of common stock and received approximately $38,000 with no material fees. Issued 533,333 shares of common stock and received approximately $200,000 with no material fees. Subsequent to September 30, 2019, the Company issued 111,111 shares of common stock and received $50,000 with no material fees.

RELATED PARTY TRANSACTIONS

RELATED PARTY TRANSACTIONS	9 Months Ended
	Sep. 30, 2019
RELATED PARTY TRANSACTIONS
13. RELATED PARTY TRANSACTIONS	The Company contracted with Norco Professional Services, LLC. (“Norco”) to provide CFO consulting services. The Company spent approximately $67,500 for the nine-month period ended September 30, 2019. Norco is owned by Andrew J. Norstrud, who joined the Company in January of 2019, as the Company’s Chief Financial Officer. The Company continues to contract Andrew Norstrud’s services through Norco. The above related party transactions are not necessarily indicative of the amounts and terms that would have been incurred had comparable transactions been entered into with independent parties.

COMMITMENTS

COMMITMENTS	9 Months Ended
	Sep. 30, 2019
COMMITMENTS
14. COMMITMENTS	Contract Purchase Price Adjustment On the one-year anniversary of the Closing Date for the Gamwell contract purchase, nDivision will calculate (using the same methods and procedures used to calculate the aggregate monthly recurring revenue from the Purchased Contracts calculated on the Closing Date (the "Closing MRR") the monthly recurring revenue for the Purchased Contracts that are still active or that have renewed their contract term (the "Anniversary MRR"), plus any monthly recurring revenue from new managed service contracts that are being invoiced at the one year anniversary of the Closing Date (the "New MRR") (Anniversary MRR plus New MRR is referred to herein as the "Total MRR"). The Cash Consideration, the amount due under the Promissory Note and the number of shares issuable pursuant to the Warrants shall be adjusted as follows: (x) the Cash Consideration shall be decreased on the Closing Date, by the amount of Customer Prepayments, as defined in the agreement, if any; (y) the principal balance of the Promissory Note shall be decreased by an amount equal to the product of the MRR Percentage Decrease, as defined in the Agreement, multiplied by the Multiple Price, as defined in the Agreement, and (z) the Warrant Percentage shall be decreased by the MRR Percentage Decrease, if any. For clarity, the Purchase Price shall not be adjusted upward for any increase in monthly recurring revenue after Closing. The Cash Consideration, Promissory Note and Warrants shall be defined as the "Purchase Price" and can be adjusted after one year, based on the newly calculated monthly recurring revenue. The Company calculated an approximate 3% decline in the purchased contracts monthly recurring revenue and recognized a gain in contingent consideration of $30,757 and reduced the loan $30,757. Operating Lease The Company adopted ASU 2016-02 using a retrospective adoption method at January 1, 2019 as noted in Note 4. “New Accounting Pronouncements”. In September 2019, the Company entered into a lease agreement that will commence on October 1, 2019 through December 31, 2024. Monthly rent payments range from $10,315.50 through $10,988.25. In accordance with ASU 2016-02, the Company will record an increase in a Right of Use Asset and a Lease Obligation of $483,200 each in October 2019. These amounts will be accreted over the remainder of the lease agreement.

SIGNIFICANT CUSTOMER

SIGNIFICANT CUSTOMER	9 Months Ended
	Sep. 30, 2019
SIGNIFICANT CUSTOMER
15. SIGNIFICANT CUSTOMERS	The Company had significant customers in each of the quarters presented. A significant customer is defined as one that makes up ten percent or more of total revenues in a particular quarter or ten percent of outstanding accounts receivable balance as of the year end. Net revenues for the three and nine months ended September 30, 2019 and 2018 include revenues from significant customers as follows: Three Months Ended September 30, Nine Months Ended September 30, 2019 2018 2019 2018 Customer A 45 % 43 % 48 % 41 % Customer B 7 % 9 % 9 % 10 % Accounts receivable balances as of September 30, 2019 and December 31, 2018 from significant customers are as follows: September 30, December 31, 2019 2018 Customer A 74 % 74 % Customer B 0 % 8 % Customer C 17 % 0 %

SUBSEQUENT EVENTS

SUBSEQUENT EVENTS	9 Months Ended
	Sep. 30, 2019
SUBSEQUENT EVENTS
16. SUBSEQUENT EVENTS	On October 10, 2019 the Company filed a Form D, notice of exempt offering of securities, with the Securities and Exchange Commission related to sales of the Company's common stock in an aggregate amount of up to $500,000.

SUMMMARY OF SIGNIFICANT ACCOU_2

SUMMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)	9 Months Ended
	Sep. 30, 2019
SUMMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation	The accompanying unaudited condensed consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and with the instructions to Article 8 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America for complete consolidated financial statements. In the opinion of management, all adjustments considered necessary for a fair presentation have been included. Operating results for the three and nine month periods ended September 30, 2019 are not necessarily indicative of the results that may be expected for the year ending December 31, 2019. The unaudited condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and footnotes thereto included in the Company's Form 10-K filed on March 29, 2019 from which the accompanying December 31, 2018 numbers are derived.
Principles of Consolidation	The unaudited condensed consolidated financial statements include the accounts and transactions of the Company and its wholly owned subsidiary, Vi3 Technologies, Inc. All significant inter-company accounts and transactions are eliminated in consolidation.
Use of Estimates	Management uses estimates and assumptions in preparing these unaudited condensed consolidated financial statements. Those estimates and assumptions affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities, and the reported revenues and expenses. Actual results could differ from those estimates.
Revenue Recognition	Topic ASC 606 is effective as of the annual reporting period beginning after December 15, 2017 using either of two methods: (1) retrospective application of Topic ASC 606 to each prior reporting period presented with the option to elect certain practical expedients as defined within Topic ASC 606 or (2) retrospective application of Topic ASC 606 with the cumulative effect of initially applying Topic ASC 606 recognized at the date of initial application and providing certain additional disclosures as defined per Topic ASC 606. We adopted Topic ASC 606 pursuant to the method (2) and we determined that any cumulative effect for the initial application did not require an adjustment to retained earnings at January 1, 2018. For revenue recognition arrangements that we determine are within the scope of Topic ASC 606, we perform the following five steps: (i) identify the contract(s) with a customer, (ii) identify the performance obligations in the contract, (iii) determine the transaction price, (iv) allocate the transaction price to the performance obligations in the contract, and (v) recognize revenue when (or as) the entity satisfies a performance obligation. We only apply the five-step model to arrangements that meet the definition of a contract under Topic 606, including when it is probable that the entity will collect the consideration it is entitled to in exchange for the goods or services it transfers to the customer. At contract inception, once the contract is determined to be within the scope of Topic 606, we evaluate the goods or services promised within each contract related performance obligation and assess whether each promised good or service is distinct. We then recognize as revenue the amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied. We recognize revenue upon completion of our performance obligations or expiration of the contractual time to use services.
Cash and Cash Equivalents	For purposes of the condensed consolidated statements of cash flows, the Company considers all highly liquid investments with a maturity of three months or less when purchased to be cash equivalents. The Company’s cash balances are primarily maintained at two separate banks. Balances are insured by the Federal Deposit Insurance Corporation subject to certain limitations.
Accounts Receivable	Accounts receivable are stated at the amount management expects to collect. An allowance for doubtful accounts is recorded, as a charge to bad debt expense, where collection is considered to be doubtful due to credit issues. These allowances together reflect the Company’s estimate of potential losses inherent in accounts receivable balances, based on historical loss and known factors impacting its customers. The Company recorded an allowance for doubtful accounts of $17,026 and $0 as of September 30, 2019 and December 31, 2018, respectively. The Company does not accrue interest on past due receivables.
Intangible Assets	Customer contracts acquired were recorded at their estimated fair value at the date of acquisition and are being amortized over their estimated useful life of five years using the straight-line method.
Impairment of Long-lived Assets	The Company records an impairment of long-lived assets used in operations, other than goodwill, when events or circumstances indicate that the asset might be impaired and the estimated undiscounted cash flows to be generated by those assets over their remaining lives are less than the carrying amount of those items. The net carrying value of assets not recoverable is reduced to fair value, which is typically calculated using the discounted cash flow method. The Company did not record any impairment during the nine months ended September 30, 2019 and September 30, 2018.
Concentration of Risk	Financial instruments, which potentially subject the Company to concentrations of credit risk, are cash and accounts receivable. See Note 15 for significant customer concentration disclosure. Cash is maintained with two separate major financial institutions in the United States and may exceed the amount of insurance provided on such deposits. Generally, these deposits may be redeemed upon demand, and, therefore, bear minimal risk.
Equipment and Software Licenses	Equipment and software licenses are stated at cost. Depreciation is calculated using the straight-line method over an estimated useful life of one to ten years.
Earnings and Loss per Share	Basic loss per share is computed by dividing net loss attributable to common stockholders by the weighted average common shares outstanding for the period. Diluted loss per share is computed giving effect to all potentially dilutive common shares. Potentially dilutive common shares may consist of incremental shares issuable upon the exercise of stock options and warrants and the conversion of notes payable to common stock. In periods in which a net loss has been incurred, all potentially dilutive common shares are considered anti-dilutive and thus are excluded from the calculation. There were approximately 9,139,000 and 8,142,000 of common stock equivalents excluded for the three and nine months ended September 30, 2019 and 2018, respectively because their effect is anti-dilutive.
Marketing Costs	Marketing costs, which are expensed as incurred, totaled approximately $29,192 and $84,214 and $687 and $11,341 for the three and nine months ended September 30, 2019 and 2018, respectively and is included in selling, general and administrative expenses.
Stock-Based Compensation	Compensation expense related to share-based transactions, including employee stock options, is measured in the financial statements based on a determination of the fair value. The grant date fair value is determined using the Black-Scholes-Merton (“Black-Scholes”) pricing model. For all stock options, the Company recognizes expense over the requisite service period on a straight-line basis (generally the vesting period of the equity grant). The Company’s option pricing model requires the input of highly subjective assumptions, including the expected stock price volatility and expected term. Any changes in these highly subjective assumptions significantly impact stock-based compensation expense. See Note 11 for the assumptions used to calculate the fair value of stock-based employee and non-employee compensation.
Leases	Leases of assets where the Company has assumed substantially all the risks and rewards of ownership are classified as finance leases. Finance leases are recognized at the lower of the fair value of the leased assets and the present value of the minimum lease payments. The interest element of the finance leases are accounted for as finance costs and expensed over the lease term using the effective interest rate method.
Income Taxes	The Company accounts for income taxes under the asset and liability method, 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. Under this method, the Company has determined the deferred tax assets and liabilities on the basis of the differences between the financial statement and tax basis of assets and liabilities by using enacted tax rates in effect for the year in which the differences are expected to reverse. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period that includes the enactment date. The Company recognizes deferred tax assets to the extent that it believes that these assets are more likely than not to be realized. In making such a determination, the Company considers all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax-planning strategies, and results of recent operations. If the Company determines that it would be able to realize our deferred tax assets in the future in excess of their net recorded amount, it would make an adjustment to the deferred tax asset valuation allowance, which would reduce the provision for income taxes. The Company records uncertain tax positions in accordance with ASC 740 on the basis of a two-step process in which (1) it determines whether it is more likely than not that the tax positions will be sustained on the basis of the technical merits of the position and (2) for those tax positions that meet the more-likely-than-not recognition threshold, it recognizes the largest amount of tax benefit that is more than 50 percent likely to be realized upon ultimate settlement with the related tax authority. The Company recognizes interest and penalties related to unrecognized tax benefits on the income tax expense line in the accompanying consolidated statement of operations. As of September 30, 2019, no accrued interest or penalties are included on the related tax liability line in the balance sheet.

EQUIPMENT AND SOFTWARE LICENS_2

EQUIPMENT AND SOFTWARE LICENSES (Tables)	9 Months Ended
	Sep. 30, 2019
EQUIPMENT AND SOFTWARE LICENSES (Tables)
Equipment and software licenses	September 30, December 31, 2019 2018 Equipment and software $ 717,063 $ 1,124,245 Software licenses 912,164 966,754 1,629,227 2,090,999 Less - Accumulated depreciation and amortization (1,344,472 ) (1,593,166 ) $ 284,755 $ 497,833

INTANGIBLE ASSETS (Tables)

INTANGIBLE ASSETS (Tables)	9 Months Ended
	Sep. 30, 2019
INTANGIBLE ASSETS (Tables)
Intangible Assets	(In Thousands) Cost Accumulated Amortization Net Book Value Customer Relationships / Service Contracts $ 1,012,335 $ (303,827 ) $ 708,508

ACCRUED LIABILITIES (Tables)

ACCRUED LIABILITIES (Tables)	9 Months Ended
	Sep. 30, 2019
ACCRUED LIABILITIES (Tables)
ACCOUNTS PAYABLE AND ACCRUED LIABILITIES	September 30, December 31, 2019 2018 Accrued compensation $ 194,087 $ 156,139 Accrued sales tax 144,289 149,821 Accrued franchise tax 4,745 35,000 Accrued professional fees and other payables 214,093 197,823 Total accrued liabilities $ 557,214 $ 538,783

NOTES PAYABLE (Tables)

NOTES PAYABLE (Tables)	9 Months Ended
	Sep. 30, 2019
NOTES PAYABLE (Tables)
Notes Payable	September 30, December 31, 2019 2018 The Company obtained an $85,670 promissory note with a maturity date of June 30, 2019, an interest rate of 6%, which is repayable in monthly installments of principal and interest of $2,270. The note is unsecured. The note has been fully repaid as of September 30, 2019. $ - $ 13,358

FINANCIAL LEASE OBLIGATIONS (Ta

FINANCIAL LEASE OBLIGATIONS (Tables)	9 Months Ended
	Sep. 30, 2019
FINANCIAL LEASE OBLIGATIONS (Tables)
Future minimum lease payments	Year ended Remainder of 2019 $ 66,306 2020 137,682 2021 20,716 2022 4,682 Total 229,386 Less: interest and sales tax (12,356 ) Present value of net minimum lease payments 217,030 Short term 187,915 Long term total $ 29,115
Minimum lease commitments	Finance Leases 2019 $ 380,249 2020 46,589 2021 2,021 Total $ 428,859

STOCK BASED COMPENSATION (Table

STOCK BASED COMPENSATION (Tables)	9 Months Ended
	Sep. 30, 2019
STOCK BASED COMPENSATION (Tables)
Summary of Stock option activity	Number of options outstanding: Beginning of year 5,901,678 Granted 1,325,000 Exercised, converted - Forfeited / exchanged / modification (287,500 ) September 30, 2019 6,939,178 Number of options exercisable at end of period 3,158,078 Number of options available for grant at end of period 1,060,823 Weighted average option prices per share: Granted during the period $ 0.61 Exercised during the period - Terminated during the period $ 0.38 Outstanding at end of the period $ 0.45 Exercisable at end of year $ 0.39
Schedule of Stock Options, Valuation Assumptions	2019 2018 Expected option life (years) 6.5 6.5 Expected stock price volatility 137-145 % 51-135 % Expected dividend yield — % — % Risk-free interest rate 2.40-2.90 % 2.00 %

SIGNIFICANT CUSTOMERS (Tables)

SIGNIFICANT CUSTOMERS (Tables)	9 Months Ended
	Sep. 30, 2019
SIGNIFICANT CUSTOMERS (Tables)
Schedules of Concentration	Net revenues for the three and nine months ended September 30, 2019 and 2018 include revenues from significant customers as follows: Three Months Ended September 30, Nine Months Ended September 30, 2019 2018 2019 2018 Customer A 45 % 43 % 48 % 41 % Customer B 7 % 9 % 9 % 10 % Accounts receivable balances as of September 30, 2019 and December 31, 2018 from significant customers are as follows: September 30, December 31, 2019 2018 Customer A 74 % 74 % Customer B 0 % 8 % Customer C 17 % 0 %

DESCRIPTION OF BUSINESS (Detail

DESCRIPTION OF BUSINESS (Details Narrative) - USD ($)	1 Months Ended		9 Months Ended
	Feb. 26, 2018	Feb. 13, 2018	Sep. 30, 2019	Dec. 31, 2018	Sep. 30, 2018
State of incorporation			Texas
Common stock issued			41,138,672	40,504,005
Common stock Outstanding			41,138,672	40,504,005
Number of common stock sold			634,668
Gain on contingent consideration			$ (30,757)
Stock price			$ 0.375		$ 0.625
Merger Agreement
Common Stock issued		27,500,000
Retirement of common stock		10,000,000
Go2Green Landscaping
Number of common stock sold		9,336,625
Value of common stock sold		$ 3,503,738
Go2Green Landscaping | Maximum [Member]
Stock price		$ 0.45
Go2Green Landscaping | Minimum [Member]
Stock price		$ 0.375
Stockholders
Common stock issued			14,400,000
Common stock Outstanding			14,400,000
Ownership Percentage			70.00%
Gamwell | Purchased Contracts
Gain on contingent consideration	$ 30,757
Value of warrants	21,158
Cash Consideration paid	800,000
Estimated cost of note	$ 191,177
Warrants percentage received	0.25%
Consideration for contracts purchased	$ 1,012,335
Decrease in loan	$ 30,757

LIQUIDITY AND GOING CONCERN (De

LIQUIDITY AND GOING CONCERN (Details Narrative) - USD ($)	9 Months Ended
	Sep. 30, 2019	Nov. 11, 2019	Sep. 30, 2018
Number of common stock sold	634,667
Stock price	$ 0.375		$ 0.625
Proceeds from sale of stock	$ 238,000
Factoring Agreements [Member]
Terms of agreement	The Company receives 90% of the factored receivables for a fee of 1.9% of the factored invoice
factored invoices		$ 163,000
Factoring Agreements [Member] | Subsequent Event [Member]
Amount of factored invoices	$ 0

SUMMMARY OF SIGNIFICANT ACCOU_3

SUMMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($)	3 Months Ended		9 Months Ended		12 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018	Dec. 31, 2018
Allowance for doubtful accounts			$ 17,026		$ 0
Impairment charge			0
Marketing costs	$ 29,192	$ 687	$ 84,214	$ 11,341
Useful life of intangible assets			5 years
Common Stock [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share	9,139,000		8,142,000	8,142,000	9,139,000
Equipment and software [Member] | Minimum [Member]
Property and equipment, useful life			1 year
Equipment and software [Member] | Maximum [Member]
Property and equipment, useful life			10 years

EQUIPMENT AND SOFTWARE LICENS_3

EQUIPMENT AND SOFTWARE LICENSES (Details) - USD ($)	Sep. 30, 2019	Dec. 31, 2018
Property, Plant and Equipment, Gross	$ 1,629,227	$ 2,090,999
Less - Accumulated depreciation and amortization	(1,344,472)	(1,593,166)
Property, Plant and Equipment, Net	284,755	497,833
Equipment and software [Member]
Property, Plant and Equipment, Gross	717,063	1,124,245
Software License [Member]
Property, Plant and Equipment, Gross	$ 912,164	$ 966,754

EQUIPMENT AND SOFTWARE LICENS_4

EQUIPMENT AND SOFTWARE LICENSES (Details Narrative) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
EQUIPMENT AND SOFTWARE LICENSES
Depreciation and amortization	$ 76,832	$ 245,599	$ 101,318	$ 315,994
Proceed from equipment and software			513,778
Equipment and software related accumulated depreciation	(494,292)		(494,292)
Gain on equipment and software	$ 12,213		12,213
Proceeds from sale of equipment and software license			$ 31,699

INTANGIBLE ASSETS (Details)

INTANGIBLE ASSETS (Details)	Sep. 30, 2019USD ($)
Intangible assets net	$ 708,508
Accumulated amortization	(494,292)
Customer Relationships [Member]
Intangible assets net	708,508
Intangible assets gross	1,012,335
Accumulated amortization	$ (303,827)

INTANGIBLE ASSETS (Details Narr

INTANGIBLE ASSETS (Details Narrative) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
INTANGIBLE ASSETS
Amortization expense	$ 50,638	$ 50,638	$ 151,913	$ 101,276
2019	50,637		50,637
2020	202,551		202,551
2021	202,551		202,551
2022	202,551		202,551
2023	50,218		50,218
Total	$ 708,508		$ 708,508

ACCRUED LIABILITIES (Details)

ACCRUED LIABILITIES (Details) - USD ($)	Sep. 30, 2019	Dec. 31, 2018
ACCRUED LIABILITIES (Details)
Accrued compensation	$ 194,087	$ 156,139
Accrued sales tax	144,289	149,821
Accrued franchise tax	4,745	35,000
Accrued professional fees and other payables	214,093	197,823
Total accrued liabilities	$ 557,214	$ 538,783

FACTORING CREDIT FACILITY (Deta

FACTORING CREDIT FACILITY (Details Narrative) - Factoring Credit Facility [Member] - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018	Dec. 31, 2018
Factoring credit facility	$ 174,479		$ 174,479		$ 169,257
Interest expense	$ 9,245	$ 16,728	$ 6,897	$ 6,897
Agreement description			The agreement provides for an advanced rate of 90% with a fee of 1.9% to be charged on the gross face amount of the invoices purchased for 30 days, and an additional. 0.06% charge for each additional day until the invoice(s) are paid

NOTE PAYABLE (Details)

NOTE PAYABLE (Details) - Long term debt - USD ($)	9 Months Ended
	Sep. 30, 2019	Dec. 31, 2018
The Company obtained an $85,670 promissory note with a maturity date of June 30, 2019, an interest rate of 6%, which is repayable in monthly installments of principal and interest of $2,270. The note is unsecured. The note has been fully repaid as of September 30, 2019.		$ 13,358
Promissory note	$ 85,670
Maturity date	Sep. 30, 2019
Interest rate	6.00%
Periodic payments	$ 2,270

FINANCE LEASE OBLIGATIONS (Deta

FINANCE LEASE OBLIGATIONS (Details)	Sep. 30, 2019USD ($)
NOTE PAYABLE (Details)
Remainder of 2019	$ 66,306
2020	137,682
2021	20,716
2022	4,682
Total	229,386
Less: interest and sales tax	(12,356)
Present value of net minimum lease payments	217,030
Short term	187,915
Long term total	$ 29,115

FINANCE LEASE OBLIGATIONS (De_2

FINANCE LEASE OBLIGATIONS (Details 1)	Sep. 30, 2019USD ($)
NOTE PAYABLE (Details)
2019	$ 380,249
2020	46,589
2021	2,021
Total	$ 428,859

FINANCE LEASE OBLIGATIONS (De_3

FINANCE LEASE OBLIGATIONS (Details Narrative) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Lease payments	$ 123,111	$ 169,538	$ 386,385	$ 260,432
Leased assets, net book value	270,264	$ 540,695	270,264	$ 540,695
Minimum [Member]
Leases Periodic payments			$ 90
Interest rate			3.60%
Lease range			1 year
Maximum [Member]
Leases Periodic payments			$ 16,824
Interest rate			55.90%
Lease range			5 years

STOCK BASED COMPENSATION (Detai

STOCK BASED COMPENSATION (Details) - $ / shares	3 Months Ended	9 Months Ended
	Sep. 30, 2019	Sep. 30, 2019
Number of options outstanding
Beginning of year		5,901,678
Granted		1,325,000
Exercised, converted
Forfeited / exchanged / modification		(287,500)
Endn of Period	6,939,178	6,939,178
Number of options exercisable at end of period		3,158,078
Number of options available for grant at end of period		1,060,823
Weighted average option prices per share
Granted during the period		$ 0.61
Exercised during the period		0.61
Forfeited/exchanged/modified during the period		0.38
Outstanding at end of the period	$ 0.45	0.45
Exercisable at end of period		$ 0.39

STOCK BASED COMPENSATION (Det_2

STOCK BASED COMPENSATION (Details 1)	3 Months Ended	9 Months Ended
	Sep. 30, 2019	Sep. 30, 2019	Sep. 30, 2018
Expected option life (years)	6 years 6 months	6 years 6 months	6 years 6 months
Expected dividend yield		0.00%	0.00%
Risk-free interest rate			2.00%
Minimum [Member]
Risk-free interest rate		2.40%
Expected stock price volatility		137.00%	51.00%
Maximum [Member]
Risk-free interest rate		2.90%
Expected stock price volatility		145.00%	135.00%

STOCK BASED COMPENSATION (Det_3

STOCK BASED COMPENSATION (Details Narrative) - USD ($)	3 Months Ended	9 Months Ended
	Sep. 30, 2019	Sep. 30, 2019	Sep. 30, 2018
Stock-based compensation expense	$ 149,436	$ 420,223
Unrecognized compensation expense	$ 1,101,368	$ 1,101,368
Weighted average vesting period of options		3 years
Expected option life (years)	6 years 6 months	6 years 6 months	6 years 6 months
Exercise price		$ 0.61
Shares issuable upon exercise of stock options	1,325,000	1,325,000
Common stock value issuable upon exercise of stock options	$ 755,000	$ 755,000
Consulting agreements
Warrants issued			2,200,000
Fair value of warrants granted			$ 61,780
2018 Equity Incentive Plan
Maximum number of shares granted under plan		8,000,000

COMMON STOCK (Details Narrative

COMMON STOCK (Details Narrative) - USD ($)	9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018
Adjustement for reverse acquisition		$ (13,885)
Adjustement for reverse acquisition (in shares)		4,400,000
Warrant issued		750,000
Common stock issued for services		$ 5,000
Material fees	$ 50,000
Common stock price	$ 0.375	$ 0.625
Common stock issued for services (in shares)		13,158
Issuance 3 [Member] | Subsequent Event [Member]
Common stock issued (in shares)	111,111
Common stock issued	$ 50,000
Issuance 1 [Member]
Common stock issued (in shares)	101,334	8,056,847
Common stock issued	$ 38,000	$ 3,016,008
Issuance 2 [Member]
Common stock issued	$ 200,000
Common stock issued (in shares)	533,333

RELATED PARTY TRANSACTIONS (Det

RELATED PARTY TRANSACTIONS (Details Narrative)	9 Months Ended
	Sep. 30, 2019USD ($)
RELATED PARTY TRANSACTIONS
Related party expenses	$ 67,500

COMMITMENTS (Details Narrative)

COMMITMENTS (Details Narrative)	9 Months Ended
	Sep. 30, 2019USD ($)
Percentage of decline in the purchased contracts monthly recurring revenue	3.00%
Gain in contingent consideration	$ 30,757
Right of use asset	483,200
Extinguishment of debt	30,757
Maximum [Member]
Rent	10,988
Minimum [Member]
Rent	$ 10,316

SIGNIFICANT CUSTOMERS (Details)

SIGNIFICANT CUSTOMERS (Details)	3 Months Ended		9 Months Ended		12 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018	Dec. 31, 2018
Net Revenue [Member] | Customer A
Concentration percentage	45.00%	43.00%	48.00%	41.00%
Net Revenue [Member] | Customer B
Concentration percentage	7.00%	9.00%	9.00%	10.00%
Accounts receivable [Member] | Customer A
Concentration percentage	74.00%				74.00%
Accounts receivable [Member] | Customer B
Concentration percentage	0.00%				8.00%
Accounts receivable [Member] | Customer C
Concentration percentage	17.00%				0.00%

SUBSEQUENT EVENTS (Details Narr

SUBSEQUENT EVENTS (Details Narrative) - USD ($)	Oct. 10, 2019	Sep. 30, 2019	Sep. 30, 2018
Proceed from sale of common stock		$ 238,000	$ 3,016,008
Subsequent Event [Member]
Proceed from sale of common stock	$ 500,000