| Note 2: Summary of significant accounting policies | Basis
of Presentation The
consolidated financial statements of the Company are prepared in conformity with accounting principles generally accepted in the
United States of America (GAAP) and the rules of the Securities and Exchange Commission (SEC). Principles
of Consolidation The
Company and its subsidiary have been consolidated in the accompanying consolidated financial statements. All intercompany balances
have been eliminated. Use
of Estimates The
preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates
and assumptions that affect reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at
the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results
could differ from those estimates. Revenue
Recognition The
Companys revenues are primarily attributable to fees for providing staffing solutions and other employment-related services.
The Company recognizes revenue when all of the following criteria are met: (i) persuasive evidence of an arrangement exists; (ii)
the product has been shipped or the services have been rendered to the customer; (iii) the sales price is fixed or determinable,
and (iv) collectability is reasonably assured. The
Companys gross billings are primarily based on (i) the payroll cost of our worksite employees; (ii) the employer portion
of payroll-related taxes; (iii) employee benefit programs; (iv) workers compensation insurance coverage, and (v) administrative
fees and delivery fees, which are the fees charged to clients for providing payroll processing and temporary and other staffing
services. Net revenues exclude the payroll cost of our worksite employees component of gross billings. With respect to
employer payroll taxes, employee benefit programs, workers compensation insurance, the Company believes that it is the
primary obligor, have latitude in establishing price, selecting suppliers, and determining the service specifications and, as
such, the gross billings for those components are included as net revenues. Net revenues are recognized ratably over the payroll
period as worksite employees perform their service at the client worksite. Consistent
with the Companys revenue recognition policy, direct costs do not include the payroll cost of our worksite employees. Cost
of revenue is primarily comprised of all other costs related to worksite employees, such as the employer portion of payroll-related
taxes, employee benefit plan premiums and workers compensation insurance costs. Cash
and Cash Equivalents The Company considers all highly liquid investments
with an original maturity of three months or less as cash equivalents. The Company maintains cash with a commercial bank and from
time to time exceed the federally insured limits. The deposits are made with a reputable financial institution, and the Company
does not anticipate realizing any losses from these deposits. The Company did not have any cash equivalents at August 31, 2017,
and 2016. None of the Companys clients represents more than 10% of our annualized revenues for fiscal years 2017 or 2016.
However, four clients represent 58% of total accounts receivable at August 31, 2017, compared to four clients representing approximately
100% of our total accounts receivable at August 31, 2016. Fixed
Assets Fixed
assets are recorded at cost, less accumulated depreciation. Expenditures for major additions and improvements are capitalized
and minor replacements, maintenance, and repairs are charged to expense as incurred. When property and equipment are retired or
otherwise disposed of, the cost and accumulated depreciation are removed from the accounts and any resulting gain or loss is included
in the results of operations for the respective period. All
fixed assets are depreciated on a straight-line basis based on their estimated useful lives. Furniture and fixtures are depreciated
over 7 years whereas computers and equipment is depreciated over 5 years. Leasehold improvements are depreciated over the lessor
of the estimated useful life of the asset or the lease term, which is 5 years. The amortization of these assets is included in
depreciation expense on the consolidated statements of operations. Fair
Value Measurements The
fair value accounting guidance defines fair value as the price that would be received to sell an asset or paid to transfer
a liability in an orderly transaction between market participants at the measurement date. The definition is based on an
exit price rather than an entry price, regardless of whether the entity plans to hold or sell the asset. This guidance also establishes
a fair value hierarchy to prioritize inputs used in measuring fair value as follows: Level
1: Observable inputs such as quoted prices in active markets; Level
2: Inputs, other than quoted prices in active markets, that are observable either directly or indirectly; and Level
3: Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions. The
Company did not fair value any of its operating assets or liabilities as of August 31, 2017, or 2016. The carrying value of accounts
receivable, prepaid expenses, accounts payables, and other current liabilities approximates the fair value due to their short-term
maturities. Income
Taxes The
Company accounts for income taxes pursuant to Financial Accounting Standards Board (FASB) Accounting Standards Codification
(ASC) 740, Income Taxes. Under FASB ASC 740 deferred income taxes are provided on a liability method
whereby deferred tax assets are recognized for deductible temporary differences and operating loss carryforwards and deferred
tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported
amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance when, in the opinion
of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. The provision
for income taxes represents the tax expense for the period, if any, and the change during the period in deferred tax assets and
liabilities. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of
enactment. FASB
ASC 740 also provides criteria for the recognition, measurement, presentation and disclosure of uncertain tax positions. Under
FASB ASC 740, the impact of an uncertain tax position on the income tax return may only be recognized at the largest amount that
is more-likely-than-not to be sustained upon audit by the relevant taxing authority. Advertising
Costs The
Company expenses advertising costs when incurred. Advertising costs incurred amounted to $273,800 and $35,000 for the years ended
August 31, 2017, and 2016, respectively. Leases For
lease agreements that provide for escalating rent payments or free-rent occupancy periods, the Company recognizes rent expense
on a straight-line basis over the non-cancelable lease term and option renewal periods where failure to exercise such options
would result in an economic penalty in such amount that renewal appears, at the inception of the lease, to be reasonably assured.
The lease term commences on the date that the Company takes possession of or controls the physical use of the property. Loss
Per Share The
Company utilizes FASB ASC 260, Earnings per Share. Basic loss per share is computed by dividing loss attributable
to common stockholders by the weighted-average number of common shares outstanding during the reporting period. Diluted loss per
share is computed similar to basic loss per share except that the denominator is increased to include additional common share
equivalents available upon exercise of stock options and warrants using the treasury stock method. Dilutive common share equivalents
include the dilutive effect of in-the-money share equivalents, which are calculated based on the average share price for each
period using the treasury stock method, excluding any common share equivalents if their effect would be anti-dilutive. Significant
Recent Accounting Pronouncements In
May 2014, the FASB issued Accounting Standards Update (ASU) 2014-09, Revenue from Contracts with Customers, issued
as a new Topic, ASC Topic 606 (ASU 2014-09). The new revenue recognition standard provides a five-step analysis of transactions
to determine when and how revenue is recognized. The premise of the guidance is that a Company should recognize revenue to depict
the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects
to be entitled in exchange for those goods or services. ASU 2014-09 can be adopted by the Company either retrospectively or as
a cumulative-effect adjustment as of the date of adoption. On April 1, 2015, the FASB decided to defer the effective date of the
new revenue standard by one year. For public entities, the update is effective for financial statements issued for fiscal years
beginning after December 15, 2018, and for private entities, the update is effective for financial statements issued after December
15, 2019. The Company is currently evaluating the new guidance and has not determined the impact this standard may have on its
financial statements or decided upon the method of adoption. In
February 2016, the FASB issued ASU 2016-02, Leases. The standard requires a lessee to recognize a liability to make lease payments
and a right-of-use asset representing a right to use the underlying asset for the lease term on the balance sheet. The ASU is
effective for fiscal years, and interim periods within those years, beginning after December 15, 2018, with early adoption permitted.
The Company is currently evaluating the impact that this standard will have on its financial statements. |
