| SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE
2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis
of presentation The
Company follows the accrual basis of accounting in accordance with generally accepted accounting principles in the United States of America
and has a year-end of December 31. Principles
of Consolidation The
consolidated financial statements include the accounts of the Company and its wholly owned subsidiary, Altitude. All significant intercompany
balances and transactions have been eliminated in the consolidation. The consolidated financial statements included herein, presented
in accordance with United States generally accepted accounting principles (“GAAP”) and stated in United States dollars, have
been prepared by the Company, pursuant to the rules and regulations of the Securities and Exchange Commission. ITA-USA
Enterprise LLC, CMA
Soccer LLC NVL
Academy LLC Trident
Water LLC North
Miami Beach Academy LLC Six
Log Cleaning & Sanitizing, LLC Altitude
International, Inc. Altitude Wellness LLC Altitude
Online Learning LLC Altitude
Sports Management Corp. All
intercompany accounts and transactions are eliminated in consolidation. Going
Concern and Liquidity We
have incurred recurring losses since inception and expect to continue to incur losses as a result of legal and professional fees and
our corporate general and administrative expenses. On December 31, 2021, we had $ 423,165
in cash. Our net losses incurred for the year
ended December 31, 2021 were $ 1,841,617 and working capital deficit was $ 1,117,979
at December 31, 2021. As a result, there is substantial
doubt about our ability to continue as a going concern. In the event that we are unable to generate sufficient cash from our operating
activities or raise additional funds, we may be required to delay, reduce or severely curtail our operations or otherwise impede our
on-going business efforts, which could have a material adverse effect on our business, operating results, financial condition and long-term
prospects. The Company expects to seek to obtain additional funding through increased revenues and future financings. There can be no
assurance as to the availability or terms upon which such financing and capital might be available. The accompanying financial
statements have been prepared assuming that the Company will continue as a going concern. Use
of Estimates The
preparation of financial statements in conformity with generally accepted accounting principles in the United States of America requires
management to make estimates and assumptions that affect the reported amounts of assets and liabilities, and disclosure of contingent
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 those estimates. Cash
and Cash Equivalents Cash
is comprised of cash balances. Cash is held at major financial institutions and is subject to credit risk to the extent that those balances
exceed applicable Federal Deposit Insurance Corporation (“FDIC”) of $ 250,000 .
The Company had material balances in excess of the insured limits as of December 31, 2021, and 2020 of approximately $ 173,000
and $ 0 ,
respectively. Accounts
Receivable Accounts
receivable for tuition is recorded by the Company. As of December 31, 2021, and 2020, the balances were $ 91,520
and $ 269,962 ,
net of allowances. There were allowances for doubtful accounts of $ 205,455
and $ 0
at December 31, 2021 and 2020, respectively.
The credit terms provided are as follows:
1. Altitude
Academies – The tuition is paid typically in two installments but, on a case-by-case
basis, modifications do occur.
2. Altitude
Water – The normal credit terms is 50% down with final payment upon delivery.
3. Altitude
Chambers – The normal credit terms is 50% down with progress payments until final payment
upon delivery. Bad debt expense is determined based on the
aging of accounts receivable and subsequent collections. Typically, receivables aged 60 days, or more is reviewed for determination.
Receivables over 90 days, unless payment terms with some payments made to date, are reserved as additional allowance for doubtful accounts. Fixed
Assets Fixed
assets are stated at cost, net of accumulated depreciation. Expenditures that extend the life, increase the capacity, or improve the
efficiency of property and equipment are capitalized, while expenditures for repairs and maintenance are expensed as incurred. Depreciation
is recognized using the straight-line method over the following approximate useful lives: SCHEDULE OF ESTIMATED USEFUL LIVES
Computers,
software, and office equipment 1 6
Machinery
and equipment 3 5
Leasehold
improvements Lesser
of lease term or estimated useful life
Operating / shop equipment 4 7
Transportation equipment 5 6 Leases In
February 2016, the FASB issued Accounting Standards Update (“ASU”) No. 2016-02, “Leases (Topic 842)” (“ASU
2016-02”) as codified in Accounting Standards Codification (“ASC”) No. 842 (“ASC 842”). ASU 2016-02, ASC
842, and additional issued guidance are intended to improve financial reporting of leasing transactions by requiring organizations that
lease assets to recognize assets and liabilities for the rights and obligations created by leases that extend more than twelve months.
As a result of the adoption of the new lease accounting guidance using the effective date transition method, on January 1, 2019, the
Company did not have any lease obligations that extended more than twelve months except for two warehouse leases for Trident Water,
which were thirteen months. We include options to extend or terminate the
lease in the lease term for accounting considerations, when it is reasonably certain that we will exercise that option. Our leases have
remaining lease terms of less than 1 year. Lease expense for lease payments is recognized on a straight-line basis over the lease term.
We do not recognize leases with an initial term of twelve months or less on the balance sheet and instead recognize the related lease
payments as expense in the consolidated statements of income on a straight-line basis over the lease term. We account for lease and non-lease
components as a single lease component for all asset classes. Our lease agreements do not contain any material residual value guarantees
or material restrictive covenants. Inventory
and Direct Costs of Revenue The
inventory is comprised of Atmospheric Water Generators (“AWG’s”) at Trident and chamber related parts at Altitude International
and are valued at the lower of cost or market. As of December 31, 2021, and 2020, the inventory was valued at $ 161,235 50,536 Inventory
is comprised of: SCHEDULE
OF INVENTORY
Finished Goods $ 33,000
Parts $ 128,235
Total $ 161,235 Impairment
of Long-Lived Assets The
Company’s long-lived assets and other assets (consisting of property and equipment) are reviewed for impairment in accordance with
the guidance of the FASB ASC Topic 360-10, Property, Plant, and Equipment. Long lived assets are reviewed for impairment whenever events
or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held
and used is measured by a comparison of the carrying amount of an asset to the undiscounted future net cash flows expected to be generated
by that asset. If the carrying amount of an asset exceeds its estimated future undiscounted cash flows, an impairment charge is recognized
by the amount by which the carrying amount of the asset exceeds the fair value of the asset. Revenue
Recognition Our
sales are generated from three revenue streams: 1) contracts with customers for the design, development, manufacture, and installation
of simulated altitude athletic equipment, 2) sports training and academic tuition, and 3) water filtration systems. For the simulated
athletic equipment and the water filtration systems, we provide our products under fixed-price contracts. Under fixed-price contracts,
we agree to perform the specified work for a pre-determined price. To the extent our actual costs vary from the estimates upon which
the price was negotiated, we will generate more or less profit or could incur a loss. We
account for a contract after it has been approved by all parties to the arrangement, the rights of the parties are identified, payment
terms are identified, the contract has commercial substance and collectability of consideration is probable. We
evaluate the products or services promised in each contract at inception to determine whether the contract should be accounted for as
having one or more performance obligations. The products and services in our contracts are typically not distinct from one another due
to their complex relationships, customization, and the significant contract management functions required to perform under the contract.
Accordingly, our contracts are typically accounted for as one performance obligation, except for the simulated altitude athletic equipment
whereas there is a service obligation over a period of time. We
determine the transaction price for each contract based on the consideration we expect to receive for the products or services being
provided under the contract. In
regard to the simulated altitude athletic equipment and the water filtration systems, we recognize revenue as performance obligations
are satisfied and the customer obtains control of the products and services. In determining when performance obligations are satisfied,
we consider factors such as contract terms, payment terms and whether there is an alternative future use of the product or service. Substantially
all of our revenue is recognized over time as we perform under the contract because if our customer were to terminate the contract for
reasons other than our non-performance, we would have the right to recover damages which would include, among other potential damages,
the right to payment for our work performed to date plus a reasonable profit to deliver products or services that do not have an alternative
use to us. In
regard to the sports training and academics tuition revenue recognition policy, the tuition is recognized over the course of the training
period which is typically a semester. In determining when performance obligations are satisfied, we consider factors as to actual
attendance at the academy. Deferred
Revenue Our
payment terms generally require a substantial initial deposit to confirm a reservation and tuition for the school year or training period.
Historically, our deferred revenue balances are comprised solely of customer deposit balances and changes from period to period due to
the seasonal nature of billings and cash collections, the amount of students in each program and the recognition of revenue. A deposit
made to the Company for tuition is contractually non-refundable. As of December 31, 2021, and 2020, deferred revenue amounted
to $ 1,388,126 and
$ 1,378,502 ,
respectively. Stock-Based
Compensation The
Company accounts for stock-based instruments issued to employees in accordance with ASC Topic 718. ASC Topic 718 requires companies to
recognize in the statement of operations the grant-date fair value of stock options and other equity-based compensation issued to employees.
The value of the portion of an award that is ultimately expected to vest is recognized as an expense over the requisite service periods
using the straight-line attribution method. Non-controlling
interest Non-controlling
interest represents third-party ownership in the net assets and partnership interests in all of our consolidated subsidiaries. For financial
reporting purposes, the assets and liabilities of our majority-owned subsidiary consolidated with those of the Company’s wholly
owned subsidiaries, with any third-party investor’s interest shown as non-controlling interest. For the year ended December 31, 2020, the
Company had $ 20,011 Fair
Value of Financial Instruments The
book values of cash, accounts receivable, and accounts payable approximate their respective fair values due to the short-term nature
of these instruments. The fair value hierarchy under GAAP distinguishes between assumptions based on market data (observable inputs)
and an entity’s own assumptions (unobservable inputs). The
hierarchy consists of three levels
● Level
one — Quoted market prices in active markets for identical assets or liabilities;
● Level
two — Inputs other than level one inputs that are either directly or indirectly observable; and
● Level
three — Unobservable inputs developed using estimates and assumptions, which are developed by the reporting entity and reflect
those assumptions that a market participant would use. Determining
which category an asset or liability falls within the hierarchy requires significant judgment. We evaluate our hierarchy disclosures
each quarter. Net
Loss Per Share Net
loss per common share is computed by dividing net loss by the weighted average common shares outstanding during the period as defined
by Financial Accounting Standards, ASC Topic 260, “Earnings per Share.” Basic earnings per common share (“EPS”)
calculations are determined by dividing net income by the weighted average number of shares of common stock outstanding during the year.
Diluted earnings per common share calculations are determined by dividing net income by the weighted average number of common shares
and dilutive common share equivalents outstanding. The Company does not have any dilutive shares of common stock as of December 31, 2021,
or 2020. Income
Taxes The
Company accounts for income taxes in accordance with FASB ASC 740, “Income Taxes.” Deferred tax assets and liabilities are
recognized for the future tax consequences attributable to temporary differences between the financial statements carrying amounts of
existing assets and liabilities and loss carryforwards and their respective tax bases. Deferred
tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income (loss) in the years in which those
temporary differences are expected to be recovered or settled. The
effect of a change in tax rules on deferred tax assets and liabilities is recognized in operations in the year of change. A valuation
allowance is recorded when it is “more likely-than-not” that a deferred tax asset will not be realized. Tax
benefits of uncertain tax positions are recognized only if it is more likely than not that the Company will be able to sustain a position
taken on an income tax return. The Company has no liability for uncertain tax positions as of December 31, 2021. Interest and penalties
in any, related to unrecognized tax benefits would be recognized as interest expense. The Company does not have any accrued interest
or penalties associated with unrecognized tax benefits, nor was any significant interest expense recognized during the year ended December
31, 2021. Contingencies Certain
conditions may exist as of the date the financial statements are issued, which may result in a loss to the Company, but which will only
be resolved when one or more future events occur or fail to occur. The Company’s management and its legal counsel assess such contingent
liabilities, and such assessment inherently involves an exercise of judgment. In assessing loss contingencies related to legal proceedings
that are pending against the Company or unasserted claims that may result in such proceedings, the Company’s legal counsel evaluates
the perceived merits of any legal proceedings or unasserted claims as well as the perceived merits of the amount of relief sought or
expected to be sought therein. If
the assessment of a contingency indicates that it is probable that a material loss has been incurred and the amount of the liability
can be estimated, then the estimated liability would be accrued in the Company’s financial statements. If the assessment indicates
that a potentially material loss contingency is not probable, but is reasonably possible, or is probable but cannot be estimated, then
the nature of the contingent liability, together with an estimate of the range of possible loss if determinable and material, would be
disclosed. Loss
contingencies considered remote are generally not disclosed unless they involve guarantees, in which case the nature of the guarantee
would be disclosed. Goodwill
and Intangible Assets The
Company accounts for intangible assets in accordance with the authoritative guidance issued by the FASB. Intangibles are valued at their
fair market value and are amortized taking into account the character of the acquired intangible asset and the expected period of benefit.
The Company evaluates intangible assets for impairment, at a minimum, on an annual basis and whenever events or changes in circumstances
indicate that the carrying value may not be recoverable from its estimated undiscounted future cash flows. Recoverability of intangible
assets is measured by comparing their net book value to the related projected undiscounted cash flows from these assets, considering
a number of factors, including past operating results, budgets, economic projections, market trends, and product development cycles.
If the net book value of the asset exceeds the related undiscounted cash flows, the asset is considered impaired, and a second test is
performed to measure the amount of impairment loss. The Company tests its goodwill using a market-based approach to determine the
estimated fair value of the reporting unit as to which the goodwill has been allocated. As of December 31, 2021, based on the assessment
of Management, the Company determined that goodwill associated with the share exchange in which the Company acquired BHI amounting to
$ 29,493,398 .
The Company will evaluate goodwill annually for any impairment. Recent
Accounting Pronouncements In
August 2020, the FASB issued ASU 2020-06, Debt with Conversion and Other Options Recently
Issued Accounting Standards: Management does not believe that any recently issued, but not yet effective, accounting standards if currently
adopted would have a material effect on the accompanying financial statements. |
