| SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 2.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis
of Presentation These
unaudited condensed consolidated financial statements of the Company and its subsidiaries are unaudited. In the opinion of management,
all adjustments (which are of a normal recurring nature) and disclosures necessary for a fair presentation of these unaudited condensed
consolidated financial statements have been included. The results reported in the unaudited condensed consolidated financial statements
for any interim periods are not necessarily indicative of the results that may be reported for the entire year. The accompanying unaudited
condensed consolidated financial statements have been prepared in accordance with the rules and regulations of the Securities and Exchange
Commission (“SEC”) and United States (“U.S.”) generally accepted accounting principles (“U.S. GAAP”),
and include the accounts of the Company and its subsidiaries. However, they do not include all information and footnotes necessary for
a complete presentation of financial statements in conformity with U.S. GAAP. Certain information and footnote disclosures normally present
in annual financial statements prepared in accordance with U.S. GAAP have been condensed or omitted. Intercompany accounts and transactions
have been eliminated in consolidation. The
Company has adopted August 31 as its fiscal year end. These unaudited financial statements should be read in conjunction with the Company’s
audited consolidated financial statements and the notes thereto included in the Company’s annual report on amended Form 10-K for
the year ended August 31, 2022. Going
Concern The
accompanying unaudited condensed consolidated financial statements have been prepared on a going concern basis, which contemplates the
realization of assets and the settlement of liabilities and commitments in the normal course of business. As
of May 31, 2023, the Company has suffered recurring losses from operations, and records an accumulated deficit, a working capital deficit
and a shareholders’ deficit of $ 37,101,862 2,525,159 2,671,199 The
Company expects to finance its operations primarily through cash flows from operations, loans from existing directors and shareholders
and placements of capital stock for additional funding. In the event that the Company requires additional funding to finance the growth
of the Company’s current and expected future operations as well as to achieve our strategic objectives, a shareholder has indicated
the intent and ability to provide additional financing. No assurance can be given that any future financing, if needed, will be available
or, if available, that it will be on terms that are satisfactory to the Company. Even if the Company is able to obtain additional financing,
if needed, it may contain undue restrictions on its operations, in the case of debt financing, or cause substantial dilution for its
stock holders, in the case of equity financing. In
March 2020 the World Health Organization declared coronavirus COVID-19 a global pandemic. The COVID-19 pandemic has negatively impacted
the global economy, workforces, customers, and created significant volatility and disruption of financial markets. It has also disrupted
the normal operations of many businesses, including the Company’s businesses. This outbreak could decrease spending, adversely
affect demand for the Company’s services and harm its business and results of operations. It is not possible for the Company to
predict the duration or magnitude of the adverse results of the outbreak and its effects on its business or results of operations at
this time. Affected
by the COVID-19, the Company had to re-organize to improve its market competitiveness and to warrant the survival and future development.
The Company also had downsized the operations to safeguard the financial position by reduction of labor costs, reduction of office space,
and simplified operational procedures. The
Company’s reduction of labor costs were done through resignation and layoffs, whereas all layoffs were processed according to local
governing labor laws. These
unaudited condensed consolidated financial statements do not include any adjustments to the recoverability and classification of recorded
asset amounts and the classification of liabilities that might be necessary should the Company be unable to continue as going concern. Use
of Estimates The
preparation of these unaudited condensed consolidated financial statements in conformity with U.S. GAAP requires the Company’s
management to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues, costs and expenses, and
related disclosures. On an on-going basis, the Company evaluates its estimates based on historical experience and on various other assumptions
that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying
values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under
different assumptions or conditions. The
COVID-19 pandemic has created and may continue to create significant uncertainty in macroeconomic conditions, which may cause further
business slowdowns or shutdowns, depress demand for the Company’s business, and adversely impact its results of operations. The
severity of the impact of the COVID-19 pandemic on the Company’s business will continue to depend on a number of factors, including,
but not limited to, the duration and severity of the pandemic, the new variants of COVID-19, the efficacy and distribution of COVID-19
vaccines and the extent and severity of the impact on the global supply chain and the Company’s customers, service providers and
suppliers, all of which are uncertain and cannot be reasonably predicted at this time. As of the date of issuance of the Company’s
financial statements, the extent to which the COVID-19 pandemic may in the future materially impact the Company’s financial condition,
liquidity or results of operations is uncertain. The Company is monitoring and assessing the evolving situation closely and evaluating
its potential exposure. Its estimates may change as new events occur and additional information emerges, and such changes are recognized
or disclosed in its consolidated financial statements. Identified
below are the accounting policies that reflect the Company’s most significant estimates and judgments, and those that the Company
believes are the most critical to fully understanding and evaluating its unaudited condensed consolidated financial statements. Business
combination The
Company accounts for its business combinations using the acquisition method of accounting in accordance with Accounting Standards Codification
(“ASC”) 805 “Business Combinations.” The cost of an acquisition is measured as the aggregate of the acquisition
date fair values of the assets transferred and liabilities incurred by the Company to the sellers and equity instruments issued. Transaction
costs directly attributable to the acquisition are expensed as incurred. Identifiable assets and liabilities acquired or assumed are
measured separately at their fair values as of the acquisition date, irrespective of the extent of any non-controlling interests. The
excess of (i) the total costs of acquisition, fair value of the non-controlling interests and acquisition date fair value of any previously
held equity interest in the acquiree over (ii) the fair value of the identifiable net assets of the acquiree is recorded as goodwill.
If the cost of acquisition is less than the fair value of the net assets of the subsidiary acquired, the difference is recognized directly
in the consolidated statements of comprehensive income. During the measurement period, which can be up to one year from the acquisition
date, the Company may record adjustments to the assets acquired and liabilities assumed with the corresponding offset to goodwill. Upon
the conclusion of the measurement period or final determination of the values of assets acquired or liabilities assumed, whichever comes
first, any subsequent adjustments are recorded to the condensed consolidated statements of comprehensive income. When
there is a change in ownership interests that result in a loss of control of a subsidiary, the Company deconsolidates the subsidiary
from the date control is lost. Any retained non-controlling investment in the former subsidiary is measured at fair value and is included
in the calculation of the gain or loss upon deconsolidation of the subsidiary. Goodwill
and impairment of Goodwill Goodwill
represents the excess of the purchase price and related costs over the fair value of the net identified tangible and intangible assets
and liabilities assumed and is not amortized (“Goodwill”). The total amount of Goodwill is deductible for tax purposes. In
accordance with ASC Topic 350, “Intangibles-Goodwill and Other,” Goodwill is not amortized but is tested for impairment,
annually or more frequently when circumstances indicate a possible impairment may exist. Impairment testing is performed at a reporting
unit level. An impairment loss generally would be recognized when the carrying amount of the reporting unit exceeds its fair value. The
Company estimates fair value of the applicable reporting unit or units using a discounted cash flow methodology. This methodology represents
a level 3 fair value measurement as defined under ASC 820, Fair Value Measurements and Disclosures, since the inputs are not readily
observable in the marketplace. The goodwill impairment testing process involves the use of significant assumptions, estimates and judgments,
including projected sales, gross margins, selling, general and administrative expenses, and capital expenditures, and the selection of
an appropriate discount rate, all of which are subject to inherent uncertainties and subjectivity. When the Company performs goodwill
impairment testing, its assumptions are based on annual business plans and other forecasted results, which it believes represent those
of a market participant. The Company selects a discount rate, which is used to reflect market-based estimates of the risks associated
with the projected cash flows based on the best information available as of the date of the impairment assessment. Based on the annual
impairment analysis, there is impairment of $ 1,747,945 1,226,419 Given
the current macro-economic environment and the uncertainties regarding its potential impact on the Company’s business, there can
be no assurance that its estimates and assumptions used in its impairment tests will prove to be accurate predictions of the future.
If the Company’s assumptions regarding forecasted cash flows are not achieved, it is possible that an impairment review may be
triggered and goodwill may be impaired. During the year ended August 31, 2022, the Company expects the reporting unit of FinTech App
development not to generate profits in the near future. As a result, the goodwill was fully impaired as of August 31, 2022. Cash
and Cash Equivalents Cash
and cash equivalents are carried at cost and represent cash on hand, demand deposits placed with banks or other financial institutions
and all highly liquid investments with an original maturity of three months or less as of the purchase date of such investments. Software
Development Costs The
Company expenses software development costs, including costs to develop software products or the software component of products to be
marketed to external users, before technological feasibility is reached. Technological feasibility is typically reached shortly before
the release of such products and, as a result, development costs that meet the criteria for capitalization were not material for the
periods presented. The
Company capitalizes development costs related to these software applications once the preliminary project stage is complete and it is
probable that the project will be completed and the software will be used to perform the function intended. No Revenue
Recognition The
Company adopted Accounting Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers (Topic 606) (“ASU
2014-09”), which establishes principles for reporting information about the nature, amount, timing and uncertainty of revenue and
cash flows arising from the entity’s contracts to provide goods or services to customers. The core principle requires an entity
to recognize revenue to depict the transfer of goods or services to customers in an amount that reflects the consideration that it expects
to be entitled to receive in exchange for those goods or services recognized as performance obligations are satisfied. The
Company recognizes revenue following the five-step model prescribed under ASU 2014-09: Step
1: Identify the contract Step
2: Identify the performance obligations Step
3: Determine the transaction price Step
4: Allocate the transaction price Step
5: Recognize revenue Revenues
are recognized when control of the promised goods or services is transferred to the Company’s customers, which may occur at a point
in time or over time depending on the terms and conditions of the agreement, in an amount that reflects the consideration we expect to
be entitled to in exchange for those goods or services. Provision
of investment platform services The
Company signed an agreement with a third party whereby the Company authorized the third party to use the Company’s JFB platform
and related applications for a period until December 31, 2020. Income from provision of investment platform services with the use of
the Company’s mobile applications is recognized when the service is performed. From
September, 2020, the Company generated additional revenue from a new, more comprehensive mobile application, which refer to as the FinMaster
mobile application (the “FinMaster App” and together with the JFB platform, the “Apps”), with similar functions
as the JFB platform. Income from providing investment platform services with the use of a mobile application is recognized when the service
is performed. The
Company offers a self-managed points program, which can be used in the FinMaster App to redeem merchandise or services. The Company determines
the value of each point based on estimated incremental cost. Customers and advocates have a variety of ways to obtain the points. The
loyalty program was subsequently ended on April 30, 2023 after the Company withdrew from the investment platform service. The major accounting
policy for its points program is described as follows: The
Company concludes the bonus points offered linked to the purchase transaction of the points is a material right and accordingly a separate
performance obligation according to ASC 606, and should be taken into consideration when allocating the transaction price of the point
sales. The Company also estimates the probability of points redemption when performing the allocation. The amount allocated to the bonus
points as separate performance obligation is recorded as contract liability (deferred revenue) and revenue should be recognized when
future goods or services are transferred. The Company will continue to monitor when and if forfeiture rate data becomes available and
will apply and update the estimated forfeiture rate at each reporting period. Since
historical information is limited for the Company to determine any potential points forfeitures and most merchandise can be redeemed
without requiring a significant amount of points compared with the amount of points provided to users, the Company has used an estimated
forfeiture rate of zero. Provision
of software development service and maintenance service The
Company entered into several agreements with third party customers to assist the customers in the development of their mobile communications
software and mobile e-commerce software. Income from provision of software development service and maintenance service are recognized
when the service is performed. Revenue
by major product line SCHEDULE
OF REVENUE BY MAJOR PRODUCT LINE
For
the nine months ended For
the three months ended
May
31, 2023 May
31, 2022 May
31, 2023 May
31, 2022
Provision of investment platform
services $ 17,476 $ 8,927 $ 79 $ 4,128
Provision of software
development service and maintenance service 346,706 147,600 15,642 129,963
Revenue $ 364,182 $ 156,527 $ 15,721 $ 134,091 Revenue
by Recognition Over Time vs Point in Time SCHEDULE
OF REVENUE BY RECOGNITION OVER TIME VS POINT IN TIME
For
the nine months ended For
the three months ended
May
31, 2023 May
31, 2022 May
31, 2023 May
31, 2022
Revenue by recognition over time $ 364,182 $ 156,527 $ 15,721 $ 134,091
Revenue by recognition
at a point in time - - - -
Revenue $ 364,182 $ 156,527 $ 15,721 $ 134,091 Remaining
performance obligations represent contracted revenues that had not yet been recognized, and include deferred revenues; invoices that
have been issued to customers but were uncollected and have not been recognized as revenues; and amounts that will be invoiced and recognized
as revenues in future periods. As of May 31, 2023, the Company’s remaining performance obligations were $ 50,000 The
Company had not occurred any costs to obtain contracts. The
Company does not have amounts of contract assets since revenue is recognized as control of goods or services is transferred. The contract
liabilities consist of advance payments from customers. The contract liabilities are reported in a net position on a customer-by-customer
basis at the end of each reporting period. All contract liabilities are expected to be recognized as revenue within one year and are
included in other payables and accrued liabilities in the consolidated balance sheet. Contract
balances The
Company’s contract liabilities consist of receipts in advance for software development and FinMaster App. The Company withdrew
from the investment platform service in February 2023 and the advance payment from FinMaster App would be refunded to customers upon
requests received. The Company updated its assessment of amount of refunds and recognized the amounts received for which it did not expect
to be entitled as a refund liability. Below is the summary presenting the movement of the Company’s contract liabilities for the
nine months ended May 31, 2023 and 2022: SCHEDULE
OF CONTRACT LIABILITIES
Receipt
in advance 2023 2022
Balance as of September 1 $ 169,951 $ 16,225
Advances received from customers 211,787 184,967
Revenue recognized (318,350 ) (11,851 )
Refund liability recognized (13,078 ) -
Exchange difference (310 ) (833 )
Balance as of May 31 $ 50,000 $ 188,508 Practical
Expedients and Exemption The
Company has not incurred any costs to obtain contracts, and does not disclose the value of unsatisfied performance obligations for contracts
with an original expected length of one year or less. Research
and development expenses Research
and development (“R&D”) expenses are primary comprised of charges for R&D and consulting work performed by third
parties; salaries and benefits for those employees engaged in research, design and development activities; costs related to design tools;
and allocated costs. For
the nine months ended May 31, 2023 and 2022, the total R&D expenses were $ 243,469 366,040 For
the three months ended May 31, 2023 and 2022, the total R&D expenses were $ 26,781 104,861 Sales
and marketing expenses Sales
and marketing expenses consist primarily of marketing and promotional expenses, salaries and other compensation-related expenses to sales
and marketing personnel. Advertising expenses consist primarily of costs for the promotion of corporate image and product marketing.
The Company expenses all advertising costs as incurred and classifies these costs under sales and marketing expenses. For the nine months
ended May 31, 2023 and 2022, advertising costs totaled $ 19,589 252,951 1,166 12,902 From
September 2019, customers or users of the FinMaster App can obtain points through any other ways such as account registration referral
to the FinMaster App, frequent sign-ins to the application and sharing articles from the application to users’ own social media,
etc. The Company believes these points are to encourage user engagement and generate market awareness. As a result, the Company accounts
for such points as sales and marketing expenses with a corresponding liability recorded under other current liabilities of its unaudited
condensed consolidated balance sheets upon the points offering. The Company estimates liabilities under the customer loyalty program
based on cost of the merchandise that can be redeemed, and its estimate of probability of redemption. At the time of redemption, the
Company records a reduction of inventory and other current liabilities. The loyalty program was ended on April 30, 2023 after the Company
withdrew from the investment platform service. Since
historical information is limited for the Company to determine any potential points forfeiture and most merchandise can be redeemed without
requiring a significant amount of points compared with the amount of points provided to users, the Company has used an estimated forfeiture
rate of zero. For
the nine months ended May 31, 2023 and 2022, redeemable point liability (credited) charged as sales and marketing expenses were $( 70,495 19,850 For
the three months ended May 31, 2023 and 2022, redeemable point liability (credited) charged as sales and marketing expenses were $( 69,018 12,363 As
of May 31, 2023 and August 31, 2022, liabilities recorded related to unredeemed points were $ nil 82,638 General
and administrative expenses General
and administrative expenses consist primarily of salaries, bonuses and benefits for employees involved in general corporate functions,
depreciation and amortization of fixed assets, legal and other professional services fees, rental and other general corporate related
expenses. Inventory Inventories
are stated at the lower of cost or net realizable value. Cost is calculated on an average basis and includes all costs to acquire and
other costs to bring the inventories to their present location and condition. The Company records inventory write-downs for excess or
obsolete inventories based upon assumptions on current and future demand forecasts. If the inventory on hand is in excess of future demand
forecast, the excess amounts are written off. The Company also reviews inventory to determine whether its carrying value exceeds the
net amount realizable upon the ultimate sale of the inventory. This requires the determination of the estimated selling price of the
vehicles less the estimated cost to convert inventory on hand into a finished product. Once inventory is written-down, a new, lower-cost
basis for that inventory is established and subsequent changes in facts and circumstances do not result in the restoration or increase
in that newly established cost basis. Inventory
as of May 31, 2023 and August 31, 2022 represents merchandise inventory which can be redeemed by deducting membership rewards points
of customer loyalty program. Leases The
Company determines if an arrangement is a lease or contains a lease at inception. Operating lease liabilities are recognized based on
the present value of the remaining lease payments, discounted using the discount rate for the lease at the commencement date. As the
rate implicit in the lease is not readily determinable for the operating lease, the Company generally uses an incremental borrowing rate
based on information available at the commencement date to determine the present value of future lease payments. Operating lease right-of-use
(“ROU assets”) assets represent the Company’s right to control the use of an identified asset for the lease term and
lease liabilities represent the Company’s obligation to make lease payments arising from the lease. ROU assets are generally recognized
based on the amount of the initial measurement of the lease liability. Lease expense is recognized on a straight-line basis over the
lease term. The Company elected the package of practical expedients permitted under the transition guidance to combine the lease and
non-lease components as a single lease component for operating leases associated with the Company’s office space lease, and to
keep leases with an initial term of 12 months or less off the balance sheet and recognize the associated lease payments in the consolidated
statements of income on a straight-line basis over the lease term. The
operating lease is included in operating lease right-of-use assets, operating lease liabilities-current and operating lease liabilities-non-current
on the Company’s consolidated balance sheets. Plant
and Equipment Plant
and equipment are stated at cost less accumulated depreciation and accumulated impairment losses, if any. Depreciation is calculated
on the straight-line basis over the following expected useful lives from the date on which they become fully operational: SCHEDULE
OF PLANT AND EQUIPMENT USEFUL LIVES
Expected
useful life
Furniture and fixture 3
Office equipment 3
Leasehold improvement 3 Intangible
assets The
Company recorded intangible assets with definite lives, including investment platform and technical know-hows. Intangible assets are
recorded at cost less accumulated amortization with no residual value. Amortization of intangible assets is computed using the straight-line
method over their estimated useful lives. The
estimated useful lives of the Company’s intangible assets are listed below: SCHEDULE
OF USEFUL LIVES OF COMPANY’S INTANGIBLE ASSETS
Investment platform 5
Technical know-hows 8
Trademarks 10 Impairment
of Long-Lived Assets (including amortizable intangible assets) The
Company reviews the carrying values of long-lived assets for impairment whenever events or changes in circumstances indicate that the
carrying value 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 future undiscounted net cash flows expected to be generated by the asset. If the assets are considered to be
impaired, the impairment recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the
assets. No Employee
benefits The
Taiwan subsidiary also operates a Defined Contribution Pension Plan under the Labor Pension Act (the Act) for employees in Taiwan. The
Act stipulated that the contribution rate by the employer per month shall not be less than 6 4,861 150,000 13,448 32,862 3,579 9,475 Full
time employees of the Company in the PRC participate in a government mandated defined contribution plan, pursuant to which certain pension
benefits, medical care, employee housing fund and other welfare benefits are provided to the employees. Chinese labor regulations require
that the PRC subsidiary of the Company make contributions to the government for these benefits based on certain percentages of the employees’
salaries, up to a maximum amount specified by the local government. The Company has no legal obligation for the benefits beyond the contributions
made. Total amounts of such employee benefit expenses, which were expensed as incurred, were approximately $ 67,862 96,022 9,812 33,251 The
Hong Kong subsidiary operates a Mandatory Provident Fund (“MPF”) scheme for all qualifying employees in Hong Kong. The MPF
is a defined contribution scheme and the assets of the scheme are managed by a trustee independent of the Company. The MPF is available
to all employees aged 10 to 64 with a least 60 days of service under the employment of the Company in Hong Kong. Contributions are made
by the Company to a cap of HK$ 1,500 192 5,115 5,124 3,524 4,083 Income
taxes Income
taxes are determined in accordance with the provisions of Accounting Standards Codification (“ASC”) Topic 740, “ Income
Taxes ASC
740 prescribes a comprehensive model for how companies should recognize, measure, present, and disclose in their financial statements
uncertain tax positions taken or expected to be taken on a tax return. Under ASC 740, tax positions must initially be recognized in the
financial statements when it is more likely than not the position will be sustained upon examination by the tax authorities. Such tax
positions must initially and subsequently be measured as the largest amount of tax benefit that has a greater than 50% likelihood of
being realized upon ultimate settlement with the tax authority assuming full knowledge of the position and relevant facts no The
Company conducts business in the PRC, Taiwan and Hong Kong and is subject to tax in these jurisdictions. As a result of its business
activities, the Company will file tax returns that are subject to examination by the respective tax authorities. Net
Loss Per Share The
Company calculates net loss per share in accordance with ASC Topic 260, “Earnings per Share.” SCHEDULE
OF RECONCILIATION OF BASIC AND DILUTED NET LOSS PER SHARE
For
the nine months ended For
the three months ended
May
31, 2023 May
31, 2022 May
31, 2023 May
31, 2022
Net loss $ (2,180,698 ) $ (9,270,401 ) $ (734,695 ) $ (4,774,115 )
Weighted
average number of shares of common stock outstanding - Basic and diluted ** 203,769,902 171,713,173 209,052,870 184,072,180
Net loss per share -
Basic and diluted $ (0.01 ) $ (0.05 ) $ (0.00 )* $ (0.02 )
* Less
than $0.01
** Including
6,484,762 6,442,936 Stock-based
compensation The Company accounts for share-based compensation awards to officers, directors,
employees, and for acquiring goods and services from nonemployees in accordance with FASB ASC Topic 718, “Compensation – Stock
Compensation”, which requires that share-based payment transactions be measured based on the grant-date fair value of the equity
instrument issued and recognized as compensation expense over the vesting period. The Company accounts for forfeitures when they occur. Cancellation
of a share-based payment by the entity results in accelerated recognition of any unrecognised cost. Cancellation by the counterparty
does not change recognition of the compensation cost. The termination of an employee that resulted in the forfeiture of share-based awards
is not considered to be a cancellation of the awards. Foreign
Currencies Translation Transactions
denominated in currencies other than the functional currency are translated into the functional currency at the exchange rates prevailing
at the dates of the transactions. Monetary assets and liabilities denominated in currencies other than the functional currency are translated
into the functional currency using the applicable exchange rates at the balance sheet dates. The resulting exchange differences are recorded
in the statements of operations. The
reporting currency of the Company is United States Dollars (“US$”). The Company’s subsidiary in Seychelles, the PRC,
Taiwan and Hong Kong maintains its books and record in United States Dollars (“US$”), Renminbi (“RMB”), New Taiwanese
Dollars (“NT$”) and United States Dollars (“US$”) respectively, which are the primary currencies of the economic
environment in which the entities operate (the functional currencies). In
general, for consolidation purposes, the assets and liabilities of the Company’s subsidiaries whose functional currency is not
US$ are translated into US$, in accordance with ASC Topic 830-30, “ Translation of Financial Statement Translation
of amounts from foreign currencies into US$ has been made at the following exchange rates for the respective periods: SCHEDULE OF FOREIGN CURRENCY TRANSLATION
As
of May
31, 2023 As
of August
31, 2022
Period-end NT$ : US$ 1 exchange
rate 30.74 30.38
Period-end RMB : US$ 1 exchange rate 7.11 6.89
For
the nine months ended,
May
31, 2023 May
31, 2022
Period average NT$ : US$ 1 exchange
rate 30.86 28.22
Period average RMB : US$ 1 exchange rate 6.97 6.42 Related
Parties Parties,
which can be a corporation or an individual, are considered to be related if the Company has the ability to, directly or indirectly,
control the other party or exercise significant influence over the other party in making financial and operating decisions. Companies
are also considered to be related if they are subject to common control or common significant influence. Convertible
instruments The
Company accounts for hybrid contracts that feature conversion options in accordance with U.S. GAAP. ASC 815 “Derivatives and Hedging
Activities,” (“ASC 815”) requires companies to bifurcate conversion options from their host instruments and account
for them as free standing derivative financial instruments according to certain criteria. The criteria |
