Document and Entity Information
Document and Entity Information | 12 Months Ended |
Sep. 30, 2022 shares | |
Entity Addresses [Line Items] | |
Entity Registrant Name | KWESST Micro Systems Inc. |
Entity Central Index Key | 0001889823 |
Entity Current Reporting Status | Yes |
Current Fiscal Year End Date | --09-30 |
Entity Common Stock, Shares Outstanding | 4,072,738 |
Document Type | 20-F |
Document Period End Date | Sep. 30, 2022 |
Entity Interactive Data Current | Yes |
Amendment Flag | false |
Document Fiscal Year Focus | 2022 |
Document Fiscal Period Focus | FY |
Entity Emerging Growth Company | true |
Entity Ex Transition Period | false |
Trading Symbol | KWE |
Security Exchange Name | NASDAQ |
Entity File Number | 001-39389 |
Entity Well-known Seasoned Issuer | No |
Entity Voluntary Filers | No |
Entity Incorporation, State or Country Code | A1 |
Entity Address, Address Line One | 155 Terence Matthews Crescent |
Entity Address, Address Line Two | Unit #1, Ottawa |
Entity Address, City or Town | Ontario |
Entity Address, Country | CA |
Entity Address, Postal Zip Code | K2M 2A8 |
Entity Filer Category | Non-accelerated Filer |
Document Annual Report | true |
Document Registration Statement | false |
Auditor Name | KPMG LLP |
Auditor Location | Ottawa, ON |
Auditor Firm ID | 85 |
Document Transition Report | false |
Document Shell Company Report | false |
Title of 12(b) Security | Common Shares, no par value |
ICFR Auditor Attestation Flag | false |
Document Accounting Standard | International Financial Reporting Standards |
Entity Shell Company | false |
Business Contact | |
Entity Addresses [Line Items] | |
Contact Personnel Name | Steven Archambault |
Entity Address, Address Line One | 155 Terence Matthews Crescent |
Entity Address, Address Line Two | Unit #1, Ottawa |
Entity Address, City or Town | Ontario |
Entity Address, Country | CA |
Entity Address, Postal Zip Code | K2M 2A8 |
City Area Code | 613 |
Local Phone Number | 319-0537 |
Consolidated Statements of Fina
Consolidated Statements of Financial Position - CAD ($) | Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2019 |
ASSETS | ||||
Cash | $ 170,545 | $ 2,688,105 | $ 3,073,760 | $ 21,615 |
Restricted cash and cash equivalents | 30,000 | 30,000 | ||
Trade and other receivables | 171,882 | 699,251 | 480,917 | 219,803 |
Current inventories | 393,538 | 90,299 | ||
Prepaid expenses and other | 122,166 | 548,042 | 441,837 | 54,075 |
Deferred share offering costs | 628,262 | 0 | ||
Current assets | 1,516,393 | 4,055,697 | 3,996,514 | 295,493 |
Property and equipment | 832,481 | 903,649 | 174,644 | 70,122 |
Right-of-use assets | 208,131 | 266,214 | 327,576 | 184,472 |
Deposits | 23,604 | 21,367 | 19,341 | 0 |
Intangible assets | 4,742,854 | 3,470,919 | 644,702 | 0 |
Other assets | 150,000 | 150,000 | ||
Non-current assets | 5,807,070 | 4,662,149 | 1,316,263 | 404,594 |
Total assets | 7,323,463 | 8,717,846 | 5,312,777 | 700,087 |
Liabilities | ||||
Accounts payable and accrued liabilities | 4,459,481 | 1,127,202 | 818,274 | 198,687 |
Lease obligations | 69,150 | 32,288 | 44,128 | 85,468 |
Accrued royalties liability | 150,000 | 0 | ||
Related party loans | 0 | 218,276 | 289,828 | |
Borrowings | 2,199,978 | 0 | 32,273 | 0 |
Deferred revenue | 7,053 | 0 | ||
Contract liabilities | 47,271 | 0 | ||
Current liabilities | 6,925,880 | 1,159,490 | 1,120,004 | 603,446 |
Accrued royalties liability | 1,115,207 | 1,105,756 | ||
Lease obligations | 206,471 | 275,621 | 307,909 | 117,218 |
Borrowings | 78,796 | 53,251 | 0 | 210,819 |
Financial derivative liabilities | 0 | 29,463 | ||
Non-current liabilities | 1,400,474 | 1,434,628 | 307,909 | 328,037 |
Total liabilities | 8,326,354 | 2,594,118 | 1,427,913 | 931,483 |
Shareholders' Equity (Deficit) | ||||
Share capital | 19,496,640 | 17,215,068 | 9,374,563 | 2,284,353 |
Warrants | 1,959,796 | 1,848,389 | ||
Contributed surplus | 3,551,330 | 2,458,211 | 583,878 | 21,050 |
Accumulated other comprehensive loss | (101,418) | (8,991) | ||
Accumulated deficit | (25,909,239) | (15,388,949) | (6,073,577) | (2,536,799) |
Total Shareholders' equity (deficit) | (1,002,891) | 6,123,728 | 3,884,864 | (231,396) |
Total Liabilities and Shareholders' Equity (Deficit) | $ 7,323,463 | $ 8,717,846 | $ 5,312,777 | $ 700,087 |
Consolidated Statements of Net
Consolidated Statements of Net Loss and Comprehensive Loss - CAD ($) | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2019 | |
Profit or loss [abstract] | ||||
Revenue | $ 861,917 | $ 721,519 | $ 1,275,804 | $ 509,148 |
Cost of sales | (247,113) | (536,735) | (798,888) | (85,101) |
Gross profit | 614,804 | 184,784 | 476,916 | 424,047 |
Operating expenses | ||||
General and administrative | 2,723,861 | 4,915,263 | 4,057,167 | 397,990 |
Selling and marketing | 564,266 | 3,296,373 | 3,484,159 | 36,681 |
Research and development, net | 817,584 | 2,064,493 | 2,138,138 | 1,003,705 |
Total operating expenses | 4,105,711 | 10,276,129 | 9,679,464 | 1,438,376 |
Operating loss | (3,490,907) | (10,091,345) | (9,202,548) | (1,014,329) |
Other income (expenses) | ||||
Fair value adjustments on derivatives | 29,463 | 0 | 0 | 113,178 |
Net finance costs | (61,397) | (506,002) | (107,751) | (245,147) |
Foreign exchange gain (loss) | (13,937) | 28,780 | (3,742) | (982) |
Loss on disposals | 0 | (1,165) | (1,331) | |
Total other expenses, net | (45,871) | (478,387) | (112,824) | (132,951) |
Loss before income taxes | (3,536,778) | (10,569,732) | (9,315,372) | (1,147,280) |
Income tax recovery: | ||||
Current tax recovery | 0 | 0 | 0 | 0 |
Deferred tax recovery | 0 | (49,442) | 0 | 0 |
Net loss | (3,536,778) | (10,520,290) | (9,315,372) | (1,147,280) |
Other comprehensive income [abstract] | ||||
Foreign currency translation differences | 0 | (92,427) | (8,991) | |
Total comprehensive loss | $ (3,536,778) | $ (10,612,717) | $ (9,324,363) | $ (1,147,280) |
Net Loss per share | ||||
Net Loss per share, Basic | $ (8.03) | $ (14.41) | $ (14.72) | $ (4.61) |
Net Loss per share, Diluted | $ (8.03) | $ (14.41) | $ (14.72) | $ (4.61) |
Weighted average number of shares outstanding | ||||
Weighted average number of shares outstanding, Basic | 440,631 | 730,302 | 632,721 | 249,001 |
Weighted average number of shares outstanding, Diluted | 440,631 | 730,302 | 632,721 | 249,001 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Shareholders' Equity - CAD ($) | Share capital [Member] | Contingent Shares [Member] | Warrants [Member] | Options [Member] | Translation reserve [Member] | Deficit [Member] | Total |
Beginning Balance at Dec. 31, 2018 | $ 200 | $ (1,389,519) | $ (1,389,319) | ||||
Beginning Balance (in shares) at Dec. 31, 2018 | 3 | 3 | |||||
Shares issued for cash (in Shares) | 72,500 | ||||||
Shares issued for cash | $ 1,014,948 | $ 1,014,948 | |||||
Shares issued for debt (in Shares) | 311,493 | ||||||
Shares issued for debt | $ 1,269,205 | $ 1,192 | 1,270,397 | ||||
Warrants issued for debt | 19,858 | 19,858 | |||||
Net loss | (1,147,280) | $ (1,147,280) | |||||
Ending Balance (in shares) at Dec. 31, 2019 | 383,996 | 383,996 | |||||
Ending Balance at Dec. 31, 2019 | $ 2,284,353 | 21,050 | (2,536,799) | $ (231,396) | |||
Shares and warrants issued on assets acquisition (in Shares) | 9,957 | ||||||
Shares and warrants issued on assets acquisition | $ 167,280 | 180,000 | 347,280 | ||||
Shares and warrants issued for cash | $ 4,568,013 | 76,120 | 4,644,133 | ||||
Shares and warrants issued in a brokered private placement (in Shares) | 62,994 | ||||||
Shares and warrants issued in a brokered private placement | $ 3,087,138 | 60,340 | 3,147,478 | ||||
Shares for converted debt and interest (in Shares) | 52,381 | ||||||
Shares for converted debt and interest | $ 1,583,881 | 1,583,881 | |||||
Shares and warrants issued in non-brokered private placements (in Shares) | 49,811 | ||||||
Shares and warrants issued in non-brokered private placements | $ 1,480,875 | 15,780 | 1,496,655 | ||||
Shares issued for performance incentive (in Shares) | 14,929 | ||||||
Shares issued for performance incentive | $ 731,500 | 731,500 | |||||
Shares from Foremost's qualifying transaction (in Shares) | 12,836 | ||||||
Shares from Foremost's qualifying transaction | $ 628,949 | $ 41,155 | 670,104 | ||||
Stock options exercised (in Shares) | 1,743 | ||||||
Stock options exercised | $ 78,080 | (17,531) | 60,549 | ||||
Shares for consulting services (in Shares) | 871 | ||||||
Shares for consulting services | $ 32,393 | 32,393 | |||||
Share-based payments | 283,084 | 283,084 | |||||
Share offering costs | $ (699,886) | (699,886) | |||||
Net loss | (3,536,778) | $ (3,536,778) | |||||
Ending Balance (in shares) at Sep. 30, 2020 | 589,518 | 589,518 | |||||
Ending Balance at Sep. 30, 2020 | $ 9,374,563 | 277,170 | 306,708 | (6,073,577) | $ 3,884,864 | ||
Shares and warrants issued on assets acquisition | 1,290,000 | 425,000 | 1,715,000 | ||||
Shares and warrants issued for cash | 4,721,818 | 1,280,654 | 6,002,472 | ||||
Shares for debt settlements | 63,866 | 63,866 | |||||
Warrants exercised | 815,307 | (175,741) | 639,566 | ||||
Shares for amended license | 137,000 | 137,000 | |||||
Stock options and warrants exercised | 1,639,695 | 41,306 | (531,263) | 1,149,738 | |||
Restricted share units vested | 12,498 | (12,498) | |||||
Share-based payments | 2,462,207 | 2,462,207 | |||||
Share offering costs | (839,679) | 233,057 | (606,622) | ||||
Other comprehensive income | $ (8,991) | (8,991) | |||||
Net loss | (9,315,372) | $ (9,315,372) | |||||
Ending Balance (in shares) at Sep. 30, 2021 | 699,511 | ||||||
Ending Balance at Sep. 30, 2021 | 17,215,068 | 1,848,389 | 2,458,211 | (8,991) | (15,388,949) | $ 6,123,728 | |
Shares issued to settle debt | 19,000 | 19,000 | |||||
Shares and warrants issued on assets acquisition | 377,503 | $ 83,319 | 132,000 | 592,822 | |||
Shares and warrants issued for cash | 272,000 | 72,000 | 344,000 | ||||
Contingent shares converted to common shares | 83,319 | $ (83,319) | |||||
Warrants exercised | 277,098 | (61,173) | 215,925 | ||||
Shares for vested RSUs and PSUs | 874,840 | (874,840) | |||||
Vested RSUs and PSUs repurchased for withholding taxes | (23,533) | (23,533) | |||||
Share-based payments | 1,960,072 | ||||||
Warrants expired | (31,420) | 31,420 | |||||
Shares issued for unsecured loans | 411,692 | 411,692 | |||||
Share offering costs | (33,880) | (33,880) | |||||
Other comprehensive income | (92,427) | (92,427) | |||||
Net loss | (10,520,290) | $ (10,520,290) | |||||
Ending Balance (in shares) at Sep. 30, 2022 | 773,225 | ||||||
Ending Balance at Sep. 30, 2022 | $ 19,496,640 | $ 1,959,796 | $ 3,551,330 | $ (101,418) | $ (25,909,239) | $ (1,002,891) |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - CAD ($) | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2019 | |
OPERATING ACTIVITIES | ||||
Net loss | $ (3,536,778) | $ (10,520,290) | $ (9,315,372) | $ (1,147,280) |
Items not affecting cash: | ||||
Share-based compensation | 283,084 | 1,960,072 | 2,462,207 | 0 |
Net finance costs | 61,217 | 506,002 | 107,751 | 230,858 |
Depreciation and amortization | 103,397 | 326,491 | 140,990 | 102,142 |
Deferred tax recovery | 0 | (49,442) | 0 | |
Loss on disposals | 0 | 1,165 | 1,331 | |
Impairment of intangible assets | 0 | 0 | 55,376 | |
Shares for amended license | 0 | 0 | 137,000 | |
Shares issued for M&A advisory and consulting services | 763,893 | 0 | 0 | 0 |
Fair value adjustments on derivative liabilities | (29,463) | 0 | 0 | (113,178) |
Non-cash listing expense | 814,703 | 0 | 0 | 0 |
Changes in non-cash working capital items | (245,095) | 3,639,822 | 198,484 | (141,575) |
Interest paid | (6,612) | (120,416) | (42,980) | (24,523) |
Cash used in operating activities | (1,791,654) | (4,256,596) | (6,255,213) | (1,093,556) |
INVESTING ACTIVITIES | ||||
Investments in intangible assets | (163,230) | (1,176,664) | (83,228) | |
Acquisition of property and equipment | (133,927) | (187,478) | (809,964) | (20,190) |
Acquisition of technology asset | (134,192) | 0 | 0 | 0 |
Cash acquired on acquisition | 0 | 162,547 | 0 | |
Recognition of open orders from acquisition | 0 | 87,802 | 0 | |
Deposit for advanced royalties | 0 | 0 | (150,000) | |
Deposit for long-term office lease | (38,212) | 0 | 0 | 0 |
Purchase of restricted short-term investment | 0 | 0 | (30,000) | |
Investments in development projects | (163,230) | 0 | ||
Cash acquired on closing of Foremost | 78,589 | 0 | 0 | 0 |
Cash flows used in investing activities | (390,972) | (1,113,793) | (1,073,192) | (20,190) |
FINANCING ACTIVITIES | ||||
Proceeds from borrowings | 40,000 | 2,543,230 | 326,000 | 0 |
Payments of deferred financing fees | 0 | (150,409) | 0 | |
Proceeds from the issuance of common shares and warrants | 4,355,171 | 344,000 | 6,002,472 | 1,014,948 |
Payments of share offering costs | (164,716) | (33,880) | (606,622) | 0 |
Proceeds from related party advances | 0 | 60,000 | 0 | 310,684 |
Repayments to related party loans | (80,000) | (60,000) | (218,276) | (70,513) |
Proceeds from exercise of warrants | 0 | 215,925 | 680,872 | |
Proceeds from convertible notes and converted to equity | 1,081,504 | 0 | 0 | 0 |
Repayments of convertible notes | 0 | (31,644) | ||
Repayments of lease obligations | (58,188) | (42,504) | (44,128) | (77,367) |
Repurchase of vested RSUs and PSUs for withholding taxes | 0 | (23,533) | 0 | |
Repayment of borrowings | 0 | 0 | (306,000) | (10,747) |
Proceeds from exercise of stock options | 61,000 | 0 | 1,108,432 | 0 |
Cash flows provided by financing activities | 5,234,771 | 2,852,829 | 6,942,750 | 1,135,361 |
Net change in cash during the period | 3,052,145 | (2,517,560) | (385,655) | 21,615 |
Cash, beginning of period | 21,615 | 2,688,105 | 3,073,760 | 0 |
Cash, end of period | $ 3,073,760 | $ 170,545 | $ 2,688,105 | $ 21,615 |
Corporate information
Corporate information | 9 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Sep. 30, 2022 | |
Corporate Information [Abstract] | ||
Corporate information [Text Block] | 1. Corporate information KWESST Micro Systems Inc. (the "Company" or "KWESST"), formerly Foremost Ventures Corp. (''Foremost''), was incorporated on November 28, 2017, under the laws of the Province of British Columbia. The Company's registered office is located at 550 Burrard Street, Suite 2900, Vancouver, British Columbia, Canada. Its corporate office is located at Unit 1, 155 Terrence Matthews Crescent, Ottawa, Ontario, Canada. On September 17, 2020, Foremost completed a Qualifying Transaction ("the QT") with KWESST Inc., a private company, was incorporated under the laws of the Province of Ontario on April 24, 2017. The QT constituted a reverse acquisition in accordance with IFRS as the shareholders of KWESST Inc. took control of Foremost (Note 4(a)). At the time of the QT, Foremost did not constitute a business as defined under IFRS 3 - Business Combinations, and therefore the QT was accounted for as an asset acquisition. As KWESST Inc. was deemed to be the acquirer for accounting purposes, the resulting consolidated statements of financial position was presented as a continuance of KWESST Inc.'s operations at their historical carrying values, and the comparative figures presented are those of KWESST Inc. The results of operations, the cash flows, and the assets and liabilities of Foremost have been included in these consolidated financial statements since September 17, 2020. Following the QT, KWESST, pursuant to Section 4.8(2) of National Instrument 51-102, provided notice that KWESST has changed its fiscal year end to September 30th from December 31st. Accordingly, these consolidated financial statements presented herein are as at and for the nine months ended September 30, 2020 with comparatives as at and for the twelve months ended December 31, 2019. KWESST develops and markets innovative products to create ''intelligent tactical systems'' and proprietary technology for game-changing applications in the military and homeland security market. KWESST's core technology has multiple applications based on its micro integrated sensor software technology, or MISST, a proprietary integration of miniaturized sensors, optics, ballistics and software that provides an advancement in affordable smart systems and mission capability. KWESST's common stock is listed on the TSX-Venture Exchange (''TSX-V'') under the stock symbol of KWE. KWESST effected a one for seventy (1-for-70) reverse stock split of its common stock on October 28, 2022 (the "Reverse Split"). The Reverse Split has been retroactively applied to these consolidated financial statements. To retroactively apply this Reverse Split, the exercise price and number of common shares issuable upon the exercise of outstanding stock options were adjusted accordingly. The restricted share units ("RSUs") and performance stock units ("PSUs") have also been adjusted. While the number of warrants has not changed as a result of the Reverse Split; the conversion rate for each warrant was adjusted from one common share to 0.01428571 of a common share. All information respecting outstanding common shares and other securities of KWESST, including net loss per share, in the current and comparative periods presented are on a Reverse Split basis. | 1. Corporate information a) Corporate information KWESST Micro Systems Inc. (the "Company", "KWESST", "we", "our", and "us") was incorporated on November 28, 2017, under the laws of the Province of British Columbia. Our registered office is located at 550 Burrard Street, Suite 2900, Vancouver, British Columbia, Canada and our corporate office is located at Unit 1, 155 Terrence Matthews Crescent, Ottawa, Ontario, Canada. We have representative offices in the following foreign locations: Washington DC (United States), London (United Kingdom), and Abu Dhabi (United Arab Emirates). We develop and commercialize next-generation technology solutions that deliver a tactical advantage for military, public safety agencies and personal defense markets. Our core mission is to protect and save lives. KWESST's common stock is listed on the TSX-Venture Exchange ("TSX-V'') under the stock symbol of KWE and on the Frankfurt Stock Exchange under the stock symbol of 62U. As a result of the U.S. IPO (see Note 28 (a), Subsequent Events - U.S. IPO and Canadian Offering b) Reverse Stock Split In August 2022, we submitted a Form F-1 Registration Statement to the U.S. Securities and Exchange Commission and applied to have its common shares listed on the Nasdaq Capital Market ("Nasdaq"). In connection with KWESST's listing application on Nasdaq, KWESST effected a one for seventy (1-for-70) reverse stock split of its common stock on October 28, 2022 (the "Reverse Split"). Accordingly, all shareholders of record at the opening of business on October 28, 2022, received one issued and outstanding common share of KWESST in exchange for seventy outstanding common shares of KWESST. No fractional shares were issued in connection with the Reverse Split. All fractional shares created by the Reverse Split were rounded to the nearest whole number of common shares, with any fractional interest representing 0.5 or more common shares entitling holders thereof to receive one whole common share. Effective on the date of the Reverse Split, the exercise price and number of common shares issuable upon the exercise of outstanding stock options were proportionately adjusted to reflect the Reverse Split. The restricted share units ("RSUs") and performance stock units ("PSUs") have also been adjusted for the Reverse Split. While the number of warrants has not changed as a result of the Reverse Split; the conversion rate for each warrant was adjusted from one common share to 0.01428571 common share. All information respecting outstanding common shares and other securities of KWESST, including net loss per share, in the current and comparative periods presented herein give effect to the Reverse Split. |
Basis of preparation
Basis of preparation | 9 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Sep. 30, 2022 | |
Disclosure Of Basis Of Preparation [Abstract] | ||
Basis of preparation [Text Block] | 2. Basis of preparation (a) Going concern These consolidated financial statements have been prepared assuming KWESST will continue as a going concern. As an early-stage company, KWESST has incurred significant losses and negative operating cash flows from inception that have primarily been funded from financing activities. The Company incurred approximately $3.5 million net loss and negative operating cash flows of approximately $1.8 million for the nine months period ended September 30, 2020 (2019 - $1.1 million net loss and negative operating cash flows of $1.1 million for 12 months). At September 30, 2020, KWESST had a working capital of $2.9 million (December 31, 2019 - working capital deficiency of $0.3 million). The Company's ability to continue as a going concern and realize its assets and discharge its liabilities in the normal course of business is dependent upon closing timely additional sales orders, achieving sustained profitability and the ability to raise additional debt or equity financing, if required, to fund its working capital requirements. There are various risk and uncertainties affecting KWESST's operating including, but not limited to: The market acceptance and rate of commercialization of the KWESST's offerings; Ability to successfully execute its business plan; Ability to raise additional capital at acceptable terms; General local and global economic conditions, including the ongoing COVID-19 pandemic, certain of which are beyond the Company's control. KWESST's strategy to mitigate these risks and uncertainties is to execute timely a business plan aimed at continued focus on revenue growth, product development and innovation, improving overall gross profit, managing operating expenses and working capital requirements, and securing additional capital, as needed. There are no guarantees that the funds raised will be sufficient to sustain KWESST's ongoing operations beyond twelve months or that additional debt or equity financing will be available to the Company or available at acceptable terms. Failure to implement the Company's business plan could have a material adverse effect on the Company's financial condition and/or financial performance. Accordingly, there are material risks and uncertainties that cast significant doubt about KWESST's ability to continue as a going concern. These consolidated financial statements do not include any adjustments or disclosures that would be required if assets are not realized and liabilities and commitments are not settled in the normal course of operations. If KWESST is unable to continue as a going concern, then the carrying value of certain assets and liabilities would require revaluation to a liquidation basis, which could differ materially on the values presented in the financial statements. (b) Statement of compliance These consolidated financial statements have been prepared in accordance with International Financial Reporting Standards (''IFRS'') as issued by the International Accounting Standards Board ("IASB") and interpretations of the IFRS Interpretations Committee ("IFRIC''). The consolidated financial statements were authorized for issue by the Board of Directors on November 22, 2021 except for Note 1 and the related changes, as to which the date is November 14, 2022. (b) Principles of consolidation These consolidated financial statements incorporate the financial statements of KWESST and the entity it controls. Control is achieved where KWESST has the power to govern the financial and operating policies of an entity so as to obtain benefits from its activities, are exposed to, or have rights to, variable returns from the Company's involvement with the entity and have the ability to affect those returns through its power over the entity. Subsidiaries are fully consolidated from the date on which control is transferred to the Company until the date on which control ceases. Profit or loss of subsidiaries acquired during the year are recognized from the date of acquisition or effective date of disposal as applicable. All intercompany transactions and balances have been eliminated. At September 30, 2020, the Company has one wholly-owned subsidiary: KWESST Inc. (c) Functional and presentation currency The consolidated financial statements are presented in Canadian dollars ("CAD"), which is the functional currency of KWESST and its subsidiary. (d) Measurement basis The consolidated financial statements have been prepared on the historical cost basis except for certain financial instruments measured at fair value. Historical cost is generally based on the fair value of the consideration given in exchange for assets. (e) Comparative figures Certain comparative figures in the consolidated statements of net loss and comprehensive loss have been reclassified to conform with the current period's presentation. (f) Use of estimates and judgments The preparation of the consolidated financial statements in accordance with IFRS requires management to make judgments, estimates, and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities, income, expenses, and disclosure of contingent liabilities. Actual results may differ from these estimates. The continuing uncertainty around the outbreak of the novel coronavirus ("COVID-19"') pandemic required the use of judgements and estimates in the preparation of the consolidated financial statements for the nine months ended September 30, 2020. The future impact of COVID-19 uncertainties could generate, in future reporting periods, a significant impact to the reported amounts of assets, liabilities, revenue and expenses in these and any future financial statements. Critical judgments that management has made in applying KWESST's accounting policies that the most significant effect on the amounts recognized in the consolidated financial statements include: assessment of KWESST's ability to continue as a going concern (Note 2(a)); and determination of the functional currency of the principal operations of KWESST(Note 2(c)). Significant areas having estimation uncertainty in applying accounting policies that have the most significant effect on the amounts recognized in the financial statements: Revenue recognition To date, substantially all of the Company's revenue arise from providing customized tactical system solutions to customers at an amount that reflects the consideration KWESST expects to receive in exchange for the system offering. The timing of revenue recognition often differs from contract payment milestones, resulting in revenue that has been earned but not billed. These amounts are included in unbilled receivables. Amounts billed in accordance with customer contracts, but not yet earned, are recorded and presented as part of deferred revenue. At September 30, 2020, management determined there was no unbilled receivables. Fair value of acquired intangible assets As disclosed in Note 1, the 1-for-70 Reverse Split effected on October 28, 2022 has been applied retrospectively herein. KWESST estimates the fair value of technology acquired based on observable market inputs. Because KWESST Inc. was a private company at the time of closing the GhostStep® Technology acquisition (see Note 4(b)), the common shares issued under this transaction were not actively trading on a stock exchange. Accordingly, management measured the fair value of the common shares based on the cash versus shares election available under the purchase agreement. Specifically, KWESST Inc. had the sole discretion to pay USD $100,000 (CAD $134,192) or issue 7,957 common shares to SageGuild. This implies a fair value of $16.80 per common share of KWESST Inc. at the time of closing the transaction. Accordingly, for the purpose of estimating the fair value of the warrants issued under this transaction (see contingent consideration below), management used $0.24 as 1/70 of the underlying stock price for one of the key inputs in the Black-Scholes pricing model. Contingent consideration As disclosed in Note 1, the 1-for-70 Reverse Split effected on October 28, 2022 has been applied retrospectively herein. The GhostStep® Technology acquisition included contingent consideration in which KWESST Inc. issued 750,000 warrants (exercisable to acquire 10,714 common shares) to SageGuild which are cancellable if service condition is not met (see Note 4(b)). The rights granted under warrants shall vest and be exercisable as to 250,000 warrants on each of December 31, 2020, 2021, and 2022 if service condition is met. Subject to the service condition being met, on each of these three vesting dates, SageGuild shall be deemed to have exercised 250,000 warrants for an aggregate purchase price of $125,000. Under IFRS, the contingent consideration is classified as either a financial liability or equity based on the feature of the contingent consideration and how the number of shares to be issued is determined. Where a fixed number of shares either will or will not be issued depending on future events, the contingent consideration meets the definition of equity. The SageGuild warrants were classified as equity and the subsequent settlement will also be accounted for within equity. The contingent consideration is required to be recognized at the acquisition date fair value even if it is not deemed to be probable of payment at the date of the acquisition. Treatment of development costs Costs to develop products are capitalized to the extent that the criteria for recognition as intangible assets in IAS 38, Intangible Assets Impairment of intangible assets At September 30, 2020, the intangible assets relates primarily the GhostStep® Technology recorded at its fair value at the acquisition date (see Note 8). Because the GhostStep® Technology is pre-commercial stage with no similar technology in the current marketplace, there is significant management judgement in projecting anticipated global market demand, pricing, and gross profit for this electronic decoy technology; all key inputs in management's discounted cash flow model to determine the recoverable amount. An impairment loss is recognized if the recoverable amount of the asset is less than the carrying amount. Useful lives of property and equipment As KWESST is an early-stage company, it has limited operating history to estimate the useful lives of property and equipment. Management made estimates based on anticipated use. Further, management has determined the residual value of these assets to be nil. At September 30, 2020, management concluded there was no evidence of a change in the useful lives of property and equipment. Fair value of share-based payments and warrants Because KWESST Inc. has limited operating history and was a private company at the time of granting stock options and issuing warrants during the nine months ended September 30, 2020, management exercised significant judgement in estimating the fair value of stock options and warrants. Fair value is estimated using the Black-Scholes pricing model, which requires management to make significant judgment principally on the following key inputs: expected life of the stock option and volatility of the underlying share price. For share-based payment, management must also apply an estimated forfeiture rate to the calculated fair value, which is subject to significant judgement due to the Company's limited history. | 2. Basis of preparation (a) Going concern These consolidated financial statements have been prepared assuming we will continue as a going concern. The going concern basis of presentation assumes we will continue in operation for the foreseeable future and can realize our assets and discharge our liabilities and commitments in the normal course of business. As an early-stage company, we not yet reached commercial production for most of our products and have incurred significant losses and negative operating cash flows from inception that have primarily been funded from financing activities. We have incurred a $10.5 million net loss and negative operating cash flows of approximately $4.3 million for the year ended September 30, 2022 (2021 - $9.3 million net loss and negative operating cash flows of $6.3 million). At September 30, 2022, we had $5.4 million in negative working capital (2021 - positive working capital of $2.9 million). Our ability to continue as a going concern and realize our assets and discharge our liabilities in the normal course of business is dependent upon closing timely additional sales orders, timely commercial launch of new products, and the ability to raise additional debt or equity financing, when required. There are various risks and uncertainties affecting our future financial position and our performance including, but not limited to: • The market acceptance and rate of commercialization of our product offerings; • Ability to successfully execute our business plan; • Ability to raise additional capital at acceptable terms; • General local and global economic conditions, including the ongoing COVID-19 pandemic and the global disruption from Russia's invasion of Ukraine. Our strategy to mitigate these material risks and uncertainties is to execute timely a business plan aimed at continued focus on revenue growth, product development and innovation, improving overall gross profit, managing operating expenses and working capital requirements, and securing additional capital, as needed. Failure to implement our business plan could have a material adverse effect on our financial condition and/or financial performance. There is no assurance that we will be able to raise additional capital as they are required in the future. Accordingly, there are material risks and uncertainties that may cast significant doubt about KWESST’s ability to continue as a going concern. Subsequent to September 30, 2022, we closed our U.S. IPO and Canadian public offering on December 9, 2022, resulting in total gross proceeds of US$14.1 million or CAD$19.2 million (see Note 27(a)). These consolidated financial statements do not include any adjustments to the carrying amounts and classification of assets, liabilities and reported expenses that may otherwise be required if the going concern basis was not appropriate. (b) Statement of compliance These consolidated financial statements have been prepared in accordance with International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board ("IASB") and interpretations of the IFRS Interpretations Committee ("IFRIC"). The consolidated financial statements were authorized for issue by the Board of Directors effective on January 27, 2023. (c) Principles of consolidation These consolidated financial statements incorporate the financial statements of KWESST and the entities it controls. Control is achieved where we have the power to govern the financial and operating policies of an entity so as to obtain benefits from its activities, are exposed to, or have rights to, variable returns from our involvement with the entity and have the ability to affect those returns through its power over the entity. Subsidiaries are fully consolidated from the date on which control is transferred to us until the date on which control ceases. Profit or loss of subsidiaries acquired during the year are recognized from the date of acquisition or effective date of disposal as applicable. All intercompany transactions and balances have been eliminated. At September 30, 2022, we have the following wholly-owned subsidiaries: Location Equity % KWESST Inc. Ottawa, Canada 100% 2720178 Ontario Inc. Bowmanville, Canada 100% Police Ordnance Company Inc. Bowmanville, Canada 100% KWESST U.S. Holdings Inc. Delaware, Canada 100% KWESST Defense Systems U.S. Inc. Virginia, United States 100% KWESST Public Safety Systems U.S. Inc. Virginia, United States 100% KWESST Public Safety Systems Canada Inc. Ottawa, Canada 100% (d) Functional and presentation currency The consolidated financial statements are presented in Canadian dollars ("CAD"), which is the functional currency of KWESST and its subsidiaries unless otherwise stated. (e) Measurement basis The consolidated financial statements have been prepared on the historical cost basis. Historical cost is generally based on the fair value of the consideration given in exchange for assets. (f) Use of judgments and estimates The preparation of the consolidated financial statements in accordance with IFRS requires management to make judgments, estimates, and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities, income, expenses, and disclosure of contingent liabilities. Actual results may differ from these estimates. Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to estimates are recognized prospectively. Judgments Information about judgments made in applying accounting policies that have the most significant effects on the amounts recognized in these consolidated financial statements is included in the following notes: • Note 4(a) - acquisition of Police Ordnance: • Note 4(b) - acquisition of PARA OPS TM System • Note 10 - unsecured loans: • Note 15(c) - share-based compensation • Note 15(c) - broker compensation options Estimates Information about assumptions and estimation uncertainties at September 30, 2022, that have a significant risk of resulting in a material adjustment to the carrying amounts of assets and liabilities in the next financial year is included in the following notes: • Note 9 - impairment test of intangible assets COVID-19 and Economic Uncertainties While COVID-19 has not had a material impact to our business to date, the following is a summary of what we believe may impact our future business given the persistency of COVID-19: disruptions to business operations resulting from quarantines of employees, customers, manufacturers and other third-party service providers in areas affected by the outbreak; disruptions to business operations resulting from travel restrictions, including travel to industry tradeshows; and uncertainty around the duration of the virus' impact. Despite the global vaccination efforts underway, the extent to which COVID-19 could impact our operations, financial condition, results of operations, and cash flows is highly uncertain and cannot be predicted. Negative financial results, uncertainties in the market, and a tightening of credit markets, caused by COVID-19, or a recession, could have a material adverse effect on our liquidity and ability to obtain financing in the future. |
Significant accounting policies
Significant accounting policies | 9 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Sep. 30, 2022 | |
Disclosure Of Significant Accounting Policies [Abstract] | ||
Significant accounting policies [Text Block] | 3. Significant accounting policies KWESST used the following significant accounting policies for the preparation of the consolidated financial statements. These policies have been applied to the comparative period. (a) Revenue recognition KWESST determines the amount of revenue to be recognized through application of the following five-step process: (i) (ii) (iii) (iv) (v) For contracts with payment milestones, Management estimates the percentage of completion and records unbilled revenue. KWESST also recognizes an asset for the incremental costs of obtaining a contract with a customer if it expects the costs to be recoverable. Management has determined that sales commissions meet the requirements to be capitalized. Capitalized contract acquisition costs are amortized consistent with the pattern of transfer to the customer for the goods and services to which the asset relates. KWESST applies the practical expedient available under IFRS 15 and does not capitalize incremental costs of obtaining contracts if the amortization period is one year or less. (b) Financial instruments KWESST recognizes a financial asset or a financial liability when it becomes a party to the contractual provisions of the instrument. Trade and other receivables without a significant financing component are initially measured at the transaction price. All other financial assets and financial liabilities are initially recognized at fair value. Transaction costs that are directly attributable to the acquisition or issue of financial assets and financial liabilities (other than financial assets and financial liabilities at fair value through profit or loss (''FVTPL'')) are added to or deducted from the fair value of the financial assets or financial liabilities, as appropriate, on initial recognition. Transaction costs directly attributable to the acquisition of financial assets or financial liabilities at fair value through profit or loss are recognized immediately in profit or loss. Financial assets All financial assets are recognized and de-recognized on trade date. Financial assts are recognized at fair value and subsequently classified and measured at: a) b) c) KWESST determines the classification of its financial assets on the basis of both the business model for managing the financial assets and the contractual cash flows characteristics of the financial asset. Financial assets are not reclassified subsequent to their initial recognition unless the Company changes its business model for managing financial assets. A financial asset is measured at amortized cost if it is held within a business model whose objective is to hold assets to collect contractual cash flows, and its contractual terms give rise on specified dates to cash flows that are solely payments of principal and interest of the principal amount outstanding. At September 30, 2020, KWESST classified the following as amortized cost: Cash Trade and other receivables Lease deposit (non-current other asset) All financial assets not classified and measured at amortized cost or FVOCI are measured at FVTPL. At September 30, 2020, KWESST did not have financial assets classified as FVOCI or FVTPL. Expected credit losses KWESST measures a loss allowance based on the lifetime expected credit losses. Lifetime expected credit losses are estimated based on factors such as KWESST's past experience of collecting payments, the number of delayed payments in the portfolio past the average credit period, observable changes in national or local economic conditions that correlate with default on receivables, financial difficulty of the borrower, and it becoming probable that the borrower will enter bankruptcy or financial re-organization. Financial assets are written off when there is no reasonable expectation of recovery. Financial liabilities Financial liabilities are recognized at fair value and subsequently classified and measured at amortized cost or fair value though profit or loss (''FVTPL''). KWESST determines the classification of its financial liabilities at initial recognition. The Company has classified the following as amortized costs: Accounts payable and accrued liabilities Related party loans Borrowings Lease obligations Convertible notes Financial liabilities at amortized cost are measured using the effective interest rate method. At September 30, 2020 and December 31, 2019, KWESST classified financial derivative liabilities as FVTPL. Accordingly, fair value is remeasured at each reporting period with the fair value adjustment recognized in profit or loss. There was no outstanding financial derivative liability at September 30, 2020. De-recognition of financial liabilities KWESST de-recognizes financial liabilities when its obligations are discharged, cancelled or they expire. (c) Property and equipment Property and equipment are measured at cost less accumulated depreciation and accumulated impairment losses. Cost comprises the fair value of consideration given to acquire or construct an asset and includes the direct charges associated with bringing the asset to the location and condition necessary for putting it into use along with the future cost of dismantling and removing the asset. These assets are depreciated over their estimated useful lives using the straight-line method as this most closely reflects the expected pattern of consumption o the future economic benefits. Depreciation methods, useful lives and residual values are reviewed at each financial year end and adjusted prospectively, if appropriate. The following table provides a summary of estimated useful lives for KWESST's property and equipment: Property and equipment Rate Computer equipment 5 years Computer software 3 years Office furniture and equipment 5 years R&D equipment 5 years Leasehold improvements Shorter of useful life or remaining term of lease At the end of each reporting period, KWESST reviews the carrying amounts of its property and equipment to determine whether there is any indication of impairment. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). The recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. For the purpose of impairment testing, assets that cannot be tested individually are grouped together into the smallest group of assets that generates cash inflows from continuing use that are largely independent of the cash flows of other assets or groups of assets (the ''cash-generating unit, or CGU''). If the recoverable amount of an asset is estimated to be less than its carrying amount, the carrying amount of the asset is reduced to its recoverable amount. An impairment loss is recognized immediately in profit or loss. Assets to be disposed of are reported at the lower of the carrying amount or fair value less costs to sell. (d) Leases At inception of a contract, KWESST assesses whether a contract is, or contains, a lease based on whether the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. KWESST recognizes a right-of-use asset and a lease liability at the lease commencement date. The lease obligation is measured at the present value of the remaining lease payments as of January 1, 2018, discounted using its incremental borrowing rate of 10%. The right-of-use asset is initially measured based on the initial amount of the lease liability adjusted for any lease payments made at or before the commencement date, plus any initial direct costs incurred and an estimate of costs to dismantle and remove the underlying asset or to restore the underlying asset or the site on which it is located, less any lease incentives received. The assets are depreciated to the earlier of the end of the useful life of the right-of-use asset or the lease term using the straight-line method as this most closely reflects the expected pattern of consumption of the future economic benefits. The lease term includes periods covered by an option to extend if KWESST is reasonably certain to exercise that option. Lease terms range from 3 to 6 years for offices and printer. In addition, the right-of-use asset is periodically reduced by impairment losses, if any, and adjusted for certain remeasurements of the lease liability. The lease liability is initially measured at the present value of the lease payments that are not paid at the commencement date, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, KWESST's incremental borrowing rate. Variable lease payments that do not depend on an index or rate are not included in the measurement of the lease liability. The lease liability is measured at amortized cost using the effective interest method. It is remeasured when there is a change in future lease payments arising from a change in an index or rate, if there is a change in KWESST's estimate of the amount expected to be payable under a residual value guarantee, or if KWESST changes its assessment of whether it will exercise a purchase, extension, or termination option. When the lease liability is remeasured in this way, a corresponding adjustment is made to the carrying value of the right-of-use asset or, is recorded in profit or loss if the carrying amount of the right-of-use asset has been reduced to zero. KWESST has elected to apply the practical expedient not to recognize right-of-use assets and lease liabilities for short-term leases that have a lease term of 12 months or less and leases of low-value assets. The lease payments associated with these leases are recognized as an expense on a straight-line basis over the lease term. (e) Intangible assets (i) Expenditure on research activities, undertaken with the prospect of gaining new scientific or technical knowledge and understanding, is recognized in profit or loss when incurred. Development activities involve a plan or design for the production of new or substantially improved products and processes. Development expenditure is capitalized only if development costs can be measured reliably, the product or process is technically and commercially feasible, future economic benefits are probable, and KWESST has the intention and sufficient resources to complete the development and to use or sell the asset. The expenditure capitalized in respect of development activities includes the cost of materials, direct labor and overhead costs that are directly attributable to preparing the asset for its intended use, and capitalized borrowing costs. Other development expenditures are recognized in profit or loss when incurred. (ii) Subsequent expenditure is capitalized only when it increases the future economic benefits embodied in the specific asset to which it relates. All other expenditures, including expenditure on internally generated goodwill and brands, is recognized in profit or loss as incurred. (iii) Amortization is a systematic allocation of the amortizable amount of an intangible asset of its useful life. The amortizable amount is the cost of the asset less its estimated residual value. KWESST recognizes in profit or loss on a sales-based rate over the estimated useful lives of the intangible assets from the date they are available for use, since this method most closely reflect the expected pattern of consumption of the future economic benefits embodied in each asset. Where a sales-based rate could not be determined, the straight-line approach is used. Internally generated intangible assets are not systematically amortized as long as they are not available for use i.e. they are not yet on site or in working condition for their intended use. Accordingly, intangible assets such as development costs are tested for impairment at least once a year, until such date as they are available for use. (iv) All intangible assets are periodically reviewed for impairment. The estimated present value of future cash flows associated with the intangible asset is determined and an impairment loss is recognized for the difference between this amount and the carrying amount as follows: the carrying amount of the asset is reduced to estimated present value of the future cash flows associated with the asset, discounted at the financial asset's original effective interest rate, and the resulting loss is directly recognized in profit or loss for the period. (f) Provisions A provision is recognized if, as a result of a past event, KWESST has a present legal or constructive obligation that can be estimated reliably, and it is probable that an outflow of economic benefits will be required to settle the obligation. Provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects current market assessments of the time value of money and the risk specific to the liability. The unwinding of the discount is recognized as a finance cost. (g) Convertible notes KWESST's convertible notes are segregated into their debt and equity components or derivative liability components at the date of issue, in accordance with the substance of the contractual agreements. The conversion feature of the convertible notes is presumed to be classified as a derivative financial liability unless it meets all the criteria to recognize as equity instrument under IAS 32, Financial Instruments: Presentation. One of the criteria is that the conversion option exchanges a fixed amount of shares for a fixed amount of cash ("fixed for fixed"). If the conversion feature meets the fixed for fixed criteria, the conversion option will be classified as equity components. Equity instruments are instruments that evidence a residual interest in the assets of an entity after deducting all of its liabilities. Therefore, when the initial carrying amount of the convertible notes is allocated to its equity and liability components, the equity component is assigned the residual amount after deducting from the fair value of the instrument as a whole the amount separately determined for the liability component. The sum of the carrying amounts assigned to the liability and equity components on initial recognition is always equal to the fair value that would be ascribed to the instrument as a whole. No gain or loss arises from initially recognizing the components of the instrument separately. If the conversion feature does not meet the fixed for fixed criteria, the conversion option will be recorded as derivative financial liability, which must be separately accounted for at fair value on initial recognition. The carrying amount of the debt component, on initial recognition, is recalculated as the difference between the proceeds of the convertible notes as a whole and the fair value of the derivative financial liabilities. Subsequent to initial recognition, the derivative financial liability is re-measured at fair value at the end of each reporting period with changes in fair value recognized in the consolidated statements of comprehensive loss for each reporting period, while the debt component is accreted to the face value of the debt using the effective interest method. Incremental costs incurred in respect of raising capital or debt are charged against the equity or debt proceeds raised, unless the instrument to which the transaction costs relate is classified as held for trading, in which case the incremental costs are expensed to profit or loss immediately. (h) Income taxes Income tax expense comprises current income tax expense and deferred income tax expense. Current and deferred income taxes are recognized as an expense and included in profit or loss for the period, except to the extent that the tax arises from a transaction which is recognized in other comprehensive income or directly in shareholder's deficiency. Current income tax Current tax expense is the amount of income taxes payable (recoverable) in respect of the taxable income (tax loss) for a period. Current liabilities (assets) for the current and prior periods are measured at the amount expected to be paid to (recovered from) the taxation authorities, using the tax rates that have been enacted or substantively enacted by the end of the reporting period. Deferred income tax Deferred tax assets and liabilities are recognized for the temporary differences between transactions that have been included in the consolidated financial statements or income tax returns. Deferred income taxes are provided for using the liability method. Under the liability method, deferred income taxes are recognized for all significant temporary differences between that the tax and financial statement bases of assets and liabilities and for certain carry-forward items. Deferred income tax assets are recognized only to the extent that, in the opinion of management, it is probable that the deferred income tax assets will be realized. Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the year when the asset is realized or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted at the reporting period. Deferred income tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of the enactment or substantive enactment. Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against current tax liabilities and when they relate to income taxes levied by the same taxation authority and KWESST intends to settle its current tax assets and liabilities on a net basis. Investment tax credits Investment tax credits relating to scientific research and experimental development expenditures are recorded in the fiscal period the qualifying expenditures are incurred based on management's interpretation of applicable legislation in the Income Tax Act of Canada. Credits are recorded provided there is reasonable assurance that the tax credit will be realized. Credits claimed are subject to review by the Canada Revenue Agency. Credits claimed in connection with R&D activities are accounted for using the cost reduction method. Under this method, assistance and credits relating to the acquisition of equipment is deducted from the cost of the related assets, and those relating to current expenditures, which are primarily salaries and related benefits, are included in the determination of profit or loss as a reduction of the R&D expenses. (i) Related party transactions Parties are considered to be related if one party has the ability, directly or indirectly, to control the other party or exercise significant influence over the other party in making financial and operating decisions. Parties are also considered to be related if they are subject to common control or common significant influence. Related parties may be individuals or corporate entities. A transaction is considered to be a related party transaction when there is a transfer of resources or obligations between related parties. Related party transactions are in the normal course of business and have commercial substance. (j) Share-based payments KWESST records share-based compensation related to its stock options and certain warrants granted from the Company. Stock-based compensation for stock options and warrants are measured at fair value using a Black Scholes option-pricing model. The market value of KWESST's shares on the date of the grant is used to determine the fair value of options and warrants. Each tranche of an award is considered a separate award with its own vesting period and grand date fair value. Compensation cost is recognized as employee benefits expense over the vesting period in which employees unconditionally become entitled to the award. The amount recognized as an expense is adjusted to reflect only the number of awards for which related service conditions are expected to be met, such that the amount ultimately recognized as an expense is based on the number of awards that meet the related service conditions at the vesting date. Where the terms of an equity-settled transaction award are modified, the minimum expense recognized is the expense as if the terms had not been modified and if the original terms of the award are met. An additional expense is recognized for any modification that increases the total fair value of the share-based payment transaction or is otherwise beneficial to the employees as measured at the date of acquisition. (k) Foreign currency Transactions in foreign currencies are translated to the respective functional currencies of KWESST at the exchange rate in effect at the transaction date. Monetary assets and liabilities denominated in other than the functional currency are translated at the exchange rates in effect at the reporting date. Non-monetary items that are measured in terms of historical cost in other than the functional currency are translated using the exchange rate at the date of the transaction. The resulting exchange gains and losses are recognized in profit or loss. (l) Earnings (loss) per share Basic earnings (loss) per share is computed using the weighted average number of common shares outstanding during the period. KWESST uses the treasury stock method to compute the dilutive effect of options, warrants, and similar instruments. Under this method, the dilutive effect on earnings per share is calculated presuming the exercise of outstanding options, warrants, and similar instruments. It assumes that the proceeds of such exercise would be used to repurchase common shares at the average market price during the period. However, the calculation of diluted loss per share excludes the effects of various conversions and exercises of convertible debt, options and warrants that would be anti-dilutive. (m) Reverse acquisition KWESST was a capital pool company, which did not constitute a business as defined under IFRS 3 - Business Combination Application of the reverse acquisitions guidance by analogy results in the private operating entity KWESST Inc. being identified as the accounting acquirer, and the listed non-operating entity KWESST being identified as the accounting acquiree. The accounting acquirer is deemed to have issued shares to obtain control of the accounting acquiree KWESST. Because the QT is not within the scope of IFRS 3, KWESST accounted for it as an asset acquisition and the consideration as a share-based payment transaction which was accounted for in accordance with IFRS 2 - Share-based Payment According to IFRS 2, any difference in the fair value of the shares deemed to have been issued by the accounting acquirer and the fair value of the accounting acquiree's identifiable net assets represents a service received by the accounting acquirer. Regardless of the level of monetary or non-monetary assets owned by the non-listed operating entity, the entire difference was considered to be payment for a service of a stock exchange listing for its shares, and that no amount should be considered a cost of raising capital. The service received in the form of a stock exchange listing does not meet the definition of an intangible asset because it is not identifiable in accordance with IAS 38 Intangible Assets (it is not separable) and does not meet the definition of an asset that should be recognized in accordance with other Standards and the Conceptual Framework, therefore the services received was recognized as listing expense (included in merger & acquisition costs in the consolidated statements of net loss and comprehensive loss). New accounting standards issued but not yet in effect Classification of liabilities as current or non-current (Amendments to IAS 1) The IASB has published Classification of Liabilities as Current or Non-Current (Amendments to IAS 1), which clarified the guidance on whether a liability should be classified as either current or non-current. The amendments were as follows: (i) end of the reporting period (ii) (iii) This new guidance is effective for annual periods beginning on or after January 1, 2022. Earlier application is permitted. KWESST has not yet assessed the impact of adoption of this guidance. Further, there is currently a proposal outstanding that would defer the effective date until January 1, 2023. | 3. Significant accounting policies (a) Revenue recognition Revenue is recognized upon transfer of control of products or services to customers at an amount that reflects the transaction price we expect to receive in exchange for the products or services. Our contracts with customers may include the delivery of multiple products and services, which are generally capable of being distinct and accounted for as separate performance obligations. The accounting for a contract or contracts with a customer that contain multiple performance obligations requires us to allocate the contract or contracts transaction price to the identified distinct performance obligations based on the stand-alone selling price of each performance obligation. Revenue from contracts with customers is recognized, for each performance obligation, either over a period of time or at a point in time, depending on which method reflects the transfer of control of the goods or services underlying the particular obligation to the customer. For performance obligations satisfied over time, we recognize revenue over time using an input method, based on costs incurred to date relative to total estimated costs at completion, to measure progress toward satisfying such performance obligation (for non-recurring engineering services, the input method is based on hours). Under this method, costs that do not contribute to the performance of KWESST in transferring control of goods or services to the customer are excluded from the measurement of progress toward satisfying the performance obligation. In certain other situations, we might recognize revenue at a point in time, when the criteria to recognize revenue over time are not met. In any event, when the total anticipated costs exceed the total anticipated revenues on a contract, such loss is recognized in its entirety in the period it becomes known. We may enter into contractual arrangements with a customer to deliver services on one project with respect to more than one performance obligation, such as non-recurring engineering, procurement, and training. When entering into such arrangements, we allocate the transaction price by reference to the stand-alone selling price of each performance obligation. Accordingly, when such arrangements exist on the same project, the value of each performance obligation is based on its stand-alone price and recognized according to the respective revenue recognition methods described above. For example, for non-recurring engineering services rendered over a contract period the revenue is recognized using the percentage of completion method; whereas for training services the revenue is recognized after the training is delivered (i.e. point in time). We account for a contract modification, which consists of a change in the scope or price (or both) of a contract, as a separate contract when the remaining goods or services to be delivered after the modification are distinct from those delivered prior to the modification and the price of the contract increases by an amount of consideration to a price which reflects KWESST's stand-alone selling price of the additional promised goods or services. When the contract modification is not accounted for as a separate contract, we recognize an adjustment to revenue on a cumulative catch-up basis at the date of contract modification. The timing of revenue recognition often differs from performance payment schedules, resulting in revenue that has been earned but not billed. These amounts are included in unbilled receivables. Amounts billed in accordance with customer contracts, but not yet earned, are recorded and presented as part of contract liabilities. When a contract includes a significant financing component, the value of such component is excluded from the transaction price and is recognized separately as finance income or expense, as applicable. (b) Business combinations We account for business combinations using the acquisition method. Goodwill arising on acquisitions is measured as the fair value of the consideration transferred less the net recognized amount of the estimated fair value of identifiable assets acquired and liabilities assumed, all measured as of the acquisition date. Transaction costs that we incur in connection with a business combination are expensed as incurred. We use our best estimates and assumptions to reasonably value assets acquired and liabilities assumed at the acquisition date as well as contingent consideration, where applicable, and these estimates are inherently uncertain and subject to refinement. As a result, during the measurement period, which may be up to one year from the acquisition date, we may record adjustments to the assets acquired and liabilities assumed with a corresponding offset to goodwill. Upon 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 in profit or loss. Where the total purchase consideration is less than the fair value of identifiable net assets, we recognize a gain on acquisition. Acquisitions that do not meet the definition of a business are accounted for as asset acquisitions in accordance with the relevant IFRS standards and applicable to the type of asset acquired. (c) Financial instruments We recognize a financial asset or a financial liability when it becomes a party to the contractual provisions of the instrument. Trade and other receivables without a significant financing component are initially measured at the transaction price. All other financial assets and financial liabilities are initially recognized at fair value. Transaction costs that are directly attributable to the acquisition or issue of financial assets and financial liabilities (other than financial assets and financial liabilities at fair value through profit or loss ("FVTPL")) are added to or deducted from the fair value of the financial assets or financial liabilities, as appropriate, on initial recognition. Transaction costs directly attributable to the acquisition of financial assets or financial liabilities at fair value through profit or loss are recognized immediately in profit or loss. Financial assets All financial assets are recognized and de-recognized on trade date. Financial assets are recognized at fair value and subsequently classified and measured at: a) b) c) We determine the classification of our financial assets on the basis of both the business model for managing the financial assets and the contractual cash flows characteristics of the financial asset. Financial assets are not reclassified subsequent to their initial recognition unless we change our business model for managing financial assets. A financial asset is measured at amortized cost if it is held within a business model whose objective is to hold assets to collect contractual cash flows, and its contractual terms give rise on specified dates to cash flows that are solely payments of principal and interest of the principal amount outstanding. Financial assets classified at amortized cost are measured using the effective interest method. At September 30, 2022, we classified the following as amortized cost: • Cash • Restricted short-term investment • Trade and other receivables • Lease deposit (non-current other asset) All financial assets not classified and measured at amortized cost or FVOCI are measured at FVTPL. At September 30, 2022, we did not have financial assets classified as FVOCI or FVTPL. Expected credit losses We measure a loss allowance based on the lifetime expected credit losses. Lifetime expected credit losses are estimated based on factors such as our past experience of collecting payments, the number of delayed payments in the portfolio past the average credit period, observable changes in national or local economic conditions that correlate with default on receivables, financial difficulty of the borrower, and it becoming probable that the borrower will enter bankruptcy or financial re-organization. Financial assets are written off when there is no reasonable expectation of recovery. Financial liabilities Financial liabilities are recognized at fair value and subsequently classified and measured at amortized cost or fair value though profit or loss ("FVTPL"). We determine the classification of our financial liabilities at initial recognition. We have classified the following as amortized costs: • Accounts payable and accrued liabilities • Corporate tax payable • Borrowings • Lease obligations • Accrued royalties liability Financial liabilities at amortized cost are measured using the effective interest rate method. De-recognition of financial liabilities KWESST de-recognizes financial liabilities when its obligations are discharged, cancelled or they expire. (d) Cash and cash equivalents Cash and cash equivalents include cash investments in interest-bearing accounts and term deposits which can readily be redeemed for cash without penalty or are issued for terms of three months or less from dated of acquisition. (e) Inventories KWESST's inventories may consist of raw materials, work-in-progress ("WIP"), and finished goods. Inventories are measured at the lower of cost and net realizable value, with cost being determined using the weighted average cost method. The cost of WIP and finished goods includes the cost of raw materials, direct labour, and overhead. Net realizable value is the estimated selling price in the ordinary course of business, less the estimated costs of completion and selling expenses. At each reporting period, management estimates the provision for obsolete and slow-moving inventory which may be reversed in subsequent periods, should the value subsequently be recovered. (f) Property and equipment Property and equipment are measured at cost less accumulated depreciation and accumulated impairment losses. Cost comprises the fair value of consideration given to acquire or construct an asset and includes the direct charges associated with bringing the asset to the location and condition necessary for putting it into use along with the future cost of dismantling and removing the asset. These assets are depreciated over their estimated useful lives using the straight-line method as this most closely reflects the expected pattern of consumption of the future economic benefits. Depreciation methods, useful lives and residual values are reviewed at each financial year end and adjusted prospectively, if appropriate. The following table provides a summary of estimated useful lives for our property and equipment: Rate Computer equipment 3 years Computer software 3 years Office furniture and equipment 5 years Low-rate initial production equipment 5 years R&D equipment 5 years Sales demo equipment 2 years Leasehold improvements Shorter of useful life or remaining term of lease At the end of each reporting period, we review the carrying amounts of its property and equipment to determine whether there is any indication of impairment. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). The recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. For the purpose of impairment testing, assets that cannot be tested individually are grouped together into the smallest group of assets that generates cash inflows from continuing use that are largely independent of the cash flows of other assets or groups of assets (the "cash-generating unit, or CGU"). If the recoverable amount of an asset is estimated to be less than its carrying amount, the carrying amount of the asset is reduced to its recoverable amount. An impairment loss is recognized immediately in profit or loss. Assets to be disposed of are reported at the lower of the carrying amount or fair value less costs to sell. (g) Leases At inception of a contract, we assess whether a contract is, or contains, a lease based on whether the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. We recognize a right-of-use asset and a lease liability at the lease commencement date. The lease obligation is measured at the present value of the lease payments that are not paid at the commencement date of the lease, discounted using its incremental borrowing rate at the inception of the lease (it was 10% for the current outstanding lease agreement). The right-of-use asset is initially measured based on the initial amount of the lease liability adjusted for any lease payments made at or before the commencement date, plus any initial direct costs incurred and an estimate of costs to dismantle and remove the underlying asset or to restore the underlying asset or the site on which it is located, less any lease incentives received. The assets are depreciated to the earlier of the end of the useful life of the right-of-use asset or the lease term using the straight-line method as this most closely reflects the expected pattern of consumption of the future economic benefits. The lease term includes periods covered by an option to extend if we are reasonably certain to exercise that option. In addition, the right-of-use asset is periodically reduced by impairment losses, if any, and adjusted for certain remeasurements of the lease liability. The lease liability is initially measured at the present value of the lease payments that are not paid at the commencement date, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, our incremental borrowing rate. Variable lease payments that do not depend on an index or rate are not included in the measurement of the lease liability. The lease liability is measured at amortized cost using the effective interest method. It is remeasured when there is a change in future lease payments arising from a change in an index or rate, if there is a change in our estimate of the amount expected to be payable under a residual value guarantee, or if we change our assessment of whether it will exercise a purchase, extension, or termination option. When the lease liability is remeasured in this way, a corresponding adjustment is made to the carrying value of the right-of-use asset or, is recorded in profit or loss if the carrying amount of the right-of-use asset has been reduced to zero. We have elected to apply the practical expedient not to recognize right-of-use assets and lease liabilities for short-term leases that have a lease term of 12 months or less and leases of low-value assets. The lease payments associated with these leases are recognized as an expense on a straight-line basis over the lease term. (h) Intangible assets (i) Expenditure on research activities, undertaken with the prospect of gaining new scientific or technical knowledge and understanding, is recognized in profit or loss when incurred. Development expenditure is capitalized only if development costs can be measured reliably, the product or process is technically and commercially feasible, future economic benefits are probable, and we have the intention and sufficient resources to complete the development and to use or sell the asset. The expenditure capitalized in respect of development activities includes the cost of materials, direct labor and overhead costs that are directly attributable to preparing the asset for its intended use, and capitalized borrowing costs. Other development expenditures are recognized in profit or loss when incurred. (ii) Subsequent expenditure is capitalized only when it increases the future economic benefits embodied in the specific asset to which it relates. All other expenditures, including expenditure on internally generated goodwill and brands, is recognized in profit or loss as incurred. (iii) Acquired intangible assets consist of open customer orders, tradenames, customer relationships, patents, and technology assets acquired either through an asset purchase or a business combination transaction. These intangible assets are recorded at their fair value at the acquisition date. After initial recognition, except for open customer orders, intangible assets are measured at cost less any accumulated amortization and impairment losses. For open customer orders, we reduce the amount when we have delivered under the customer contract, with an offset to accounts receivable (i.e. there is no revenue recognized for acquired open customer orders). Intangible assets with finite useful lives are amortized on a straight-line basis over their estimated useful lives. Amortization begins when the related acquired technology is commercialized. We anticipate the estimated useful life for the current technology assets to be five years once commercialized. (iv) Amortization is a systematic allocation of the amortizable amount of an intangible asset of its useful life. The amortizable amount is the cost of the asset less its estimated residual value. We recognize in profit or loss on a sales-based rate over the estimated useful lives of the intangible assets from the date they are available for use, since this method most closely reflects the expected pattern of consumption of the future economic benefits embodied in each asset. Where a sales-based rate could not be determined, the straight-line approach is used. Internally generated intangible assets are not systematically amortized as long as they are not available for use i.e. they are not yet in working condition for their intended use. Accordingly, intangible assets such as development costs are tested for impairment at least once a year, until such date as they are available for use. (v) All intangible assets are periodically reviewed for impairment. The estimated present value of future cash flows associated with the intangible asset is determined and an impairment loss is recognized for the difference between this amount and the carrying amount as follows: the carrying amount of the asset is reduced to estimated present value of the future cash flows associated with the asset, discounted at the financial asset's original effective interest rate, and the resulting loss is directly recognized in profit or loss for the period. (i) Provisions A provision is recognized if, as a result of a past event, we have a present legal or constructive obligation that can be estimated reliably, and it is probable that an outflow of economic benefits will be required to settle the obligation. Provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects current market assessments of the time value of money and the risk specific to the liability. The accretion of the discount is recognized as a finance cost. (j) Income taxes Income tax expense comprises current income tax expense and deferred income tax expense. Current and deferred income taxes are recognized as an expense and included in profit or loss for the period, except to the extent that the tax arises from a transaction which is recognized in other comprehensive income or directly in shareholder's deficiency. Current income tax Current tax expense is the amount of income taxes payable (recoverable) in respect of the taxable income (tax loss) for a period. Current liabilities (assets) for the current and prior periods are measured at the amount expected to be paid to (recovered from) the taxation authorities, using the tax rates that have been enacted or substantively enacted by the end of the reporting period. Deferred income tax Deferred tax assets and liabilities are recognized for the temporary differences between transactions and carrying amounts of assets and liabilities that have been included in the consolidated financial statements and the amounts used for taxation purposes. Deferred income taxes are provided for using the liability method. Under the liability method, deferred income taxes are recognized for all significant temporary differences between the tax and financial statement bases of assets and liabilities and for certain carry-forward items. Deferred income tax assets are recognized only to the extent that it is probable that the deferred income tax assets will be realized. Deferred tax assets are reviewed at each reporting date and are reduced to the extent it is no longer probable that the related tax benefit will be realized. Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the year when the asset is realized or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted at the reporting period. Deferred income tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of the enactment or substantive enactment. Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against current tax liabilities and when they relate to income taxes levied by the same taxation authority and we intend to settle our current tax assets and liabilities on a net basis. Investment tax credits Investment tax credits relating to scientific research and experimental development expenditures are recorded in the fiscal period the qualifying expenditures are incurred based on management's interpretation of applicable legislation in the Income Tax Act of Canada. Credits are recorded provided there is reasonable assurance that the tax credit will be realized. Credits claimed are subject to review by the Canada Revenue Agency. Credits claimed in connection with R&D activities are accounted for using the cost reduction method. Under this method, assistance and credits relating to the acquisition of equipment is deducted from the cost of the related assets, and those relating to current expenditures, which are primarily salaries and related benefits, are included in the determination of profit or loss as a reduction of the R&D expenses. (k) Related party transactions Parties are considered to be related if one party has the ability, directly or indirectly, to control the other party or exercise significant influence over the other party in making financial and operating decisions. Parties are also considered to be related if they are subject to common control or common significant influence. Related parties may be individuals or corporate entities. A transaction is considered to be a related party transaction when there is a transfer of resources or obligations between related parties. Related party transactions are in the normal course of business and have commercial substance. (l) Share-based compensation We have a Long-Term Incentive Plan ("LTIP") in which we may grant stock options, restricted share units ("RSUs"), performance stock units ("PSUs"), deferred stock units ("DSUs"), and stock appreciation rights ("SARs") to directors, employees and consultants. We measure share-based compensation at fair value for all share-based awards granted under the LTIP. Equity-settled service award The grant date fair value of equity-settled share-based awards is recognized as an expense on a straight-line basis over the requisite service period, with a corresponding increase in equity, over the vesting period of the awards. For stock options, the grant date fair value is determined using the Black-Scholes option model. For share units, the grant date fair value is based on KWESST's closing stock price. Each tranche of an award is considered a separate award with its own vesting period and grand date fair value. The amount recognized as an expense is adjusted for estimated forfeitures. Equity-settled performance award The accounting for equity-settled performance award is the same as above, except compensation expense is subject to periodic adjustment based on the achievement of establishment performance criteria. Modified award Where the terms of an equity-settled transaction award are modified, the minimum expense recognized is the expense as if the terms had not been modified and if the original terms of the award are met. An additional expense is recognized for any modification that increases the total fair value of the share-based payment transaction or is otherwise beneficial to the employees as measured at the date of acquisition. (m) Foreign currency Foreign currency transactions The financial statements of KWESST and its Canadian wholly-owned subsidiaries are measured using CAD as the functional currency. Transactions in currencies other than in CAD are translated at the exchange rates prevailing at the dates of the transactions. At the end of each reporting period, monetary items denominated in foreign currencies are translated to the functional currency at the rates prevailing at that date. Exchange differences on monetary items are recognized in profit or loss in the period in which they arise. Non-monetary items carried at fair value that are denominated in foreign currencies are translated to the functional currency at the rates prevailing at the date when the fair value was determined. Non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the rates at the date of the transaction and are not subsequently retranslated. Foreign operations The financial statements of KWESST's U.S. owned subsidiaries are measured using the United States dollar ("USD") as its functional currency. Assets and liabilities have been translated into USD using exchange rates prevailing at the end of each reporting period. Income and expense items are translated at the average exchange rates for the period, unless exchange rates fluctuate significantly during that period, in which cases the exchange rates at the dates of the transactions are used. Exchange differences arising, if any, are recognized in other comprehensive income and accumulated in shareholders' equity. (n) Earnings (loss) per share Basic earnings (loss) per share is computed using net earnings (loss) over the weighted average number of common shares outstanding during the period. We use the treasury stock method to compute the dilutive effect of options, warrants, and similar instruments. Under this method, the dilutive effect on earnings per share is calculated presuming the exercise of outstanding options, warrants, and similar instruments. It assumes that the proceeds of such exercise would be used to repurchase common shares at the average market price during the period. However, the calculation of diluted loss per share excludes the effects of various conversions and exercises of convertible debt, options and warrants that would be anti-dilutive. |
Acquisitions
Acquisitions | 9 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Sep. 30, 2022 | |
Disclosure of detailed information about business combination [abstract] | ||
Acquisitions [Text Block] | 4. Acquisitions As disclosed in Note 1, the 1-for-70 Reverse Split effected on October 28, 2022 has been applied retrospectively herein. a) On September 17, 2020, Foremost completed the QT with KWESST Inc. pursuant to the policies of the TSX Venture Exchange (''TSX-V''). Prior to the completion of the QT, Foremost effected a consolidation of its outstanding common shares on the basis of one post-consolidation common share for every 326.9 pre-consolidation common shares. The QT was done by way of a three-cornered amalgamation (the "Amalgamation") pursuant to which, among other things: (i) (ii) (iii) Immediately following the QT, there were 589,517 shares of KWESST outstanding, of which 576,681 were held by the former shareholders of KWESST Inc. (representing approximately 97.8% of the outstanding shares of the Company) and 12,836 were held by the shareholders of Foremost prior to the QT. Accordingly, this transaction was accounted for as a reverse acquisition where KWESST Inc. is deemed to be the acquirer for accounting purposes. The reverse acquisition of Foremost was accounted for under IFRS 2, Share-based Payment The following represents management's estimate of the fair value of the net assets acquired and total consideration transferred at September 17, 2020, the closing date of the QT. Number of common shares issued to Foremost shareholders 12,836 KWESST's stock price at closing of reverse acquisition (1) $ 49.00 Common shares $ 628,949 Options 41,155 Total consideration transferred $ 670,104 (1) The total fair value consideration was allocated to Foremost's net assets as follows: Total fair value consideration $ 670,104 Foremost's net assets (liabilities): Cash $ 78,589 Other receivables 1,900 Accounts payable and accrued liabilities (225,088 ) Net assets (liabilities) at fair value (144,599 ) Residual balance allocated to listing expense (included in M&A costs) 814,703 Total $ 670,104 The results of operations of Foremost are included in these consolidated statements of comprehensive loss from September 17, 2020. The listing expense of $814,703 is a non-cash item - see consolidated statements of cash flows. In addition, 14,286 common shares with fair value of $700,000 were issued to two M&A / capital market advisors for successfully assisting KWESST to complete the QT. One of the two advisors is a related party (Note 16). b) On June 12, 2020, KWESST Inc. entered into the GhostStep Technology Purchase Agreement (the "Purchase Agreement") with SageGuild LLC ("SageGuild") pursuant to which KWESST Inc. acquired the GhostStep® Technology. Management determined that this transaction did not meet the definition of a business under IFRS 3 and therefore this transaction was accounted for as an asset acquisition. The total purchase consideration ("Purchase Price") comprised of: (i) (ii) (iii) As a result of completing the QT, KWESST Inc. has elected to issue 7,957 common shares to SageGuild. In addition to the Purchase Price, pursuant to the Purchase Agreement KWESST Inc. has: (i) (ii) The Warrants will vest in equal tranches of 250,000 warrants on each of December 31, 2020, 2021 and 2022. KWESST has the right to apply the Yearly Payments against the exercise price of the Warrants. Accordingly, the total purchase consideration amounted to: Cash consideration $ 134,192 Share issuance with no condition 33,600 Elected share issuances 133,680 Contingent consideration 180,000 Total purchase consideration $ 481,472 The above total purchase consideration was recognized as intangible assets (see Note 8). In addition to the above total purchase consideration, KWESST Inc. has agreed to pay SageGuild royalties at a rate of 20% on amounts received in consideration of the grant of licenses and on sales of the GhostStep® Technology until KWESST has paid SageGuild a total of USD $3 million in royalties. Once KWESST has paid SageGuild a total of USD $3 million in royalties, the royalty rate will decrease to 5%. The obligation to pay royalties will terminate automatically once KWESST has paid SageGuild a total of USD $20 million in royalties. The Purchase Agreement became effective on June 12, 2020 and will continue in full force and effect until the earliest of (i) June 12, 2040 or (ii) the date of the expiration of the last of the patents or any of the patents (which are expected to be valid for a period of seventeen years from the date of issuance) related to improvements of the GhostStep® Technology to which SageGuild, or its principal Mr. Jeffrey M. Dunn, materially contributes, unless the terminated earlier in accordance with the terms and conditions of the agreement. In the event KWESST is in default of payment of any royalty payment as outlined above for a period of 30 days, SageGuild may terminate the agreement and KWESST will be required to, among other things, transfer the GhostStep® Technology back to SageGuild. KWESST Inc. did not have any sales during the nine months ended September 30, 2020 that would have triggered royalty payments payable to SageGuild. | 4. Acquisitions a) Police Ordnance On December 15, 2021, we acquired 2720178 Ontario Inc., an Ontario (Canada) corporation, which owns all of the issued and outstanding shares of Police Ordnance Company Inc., an Ontario (Canada) corporation (together, "Police Ordnance"), herein referred as the "Police Ordnance Acquisition". Located in Bowmanville, Ontario, with ancillary operations in Florida, Police Ordnance owns all intellectual properties to the ARWEN TM We accounted for the acquisition of Police Ordinance pursuant to IFRS 3, Business Combinations Consideration Transferred The purchase consideration comprised of the following: Number Fair Value Common shares 3,965 $ 377,503 Warrants 200,000 $ 132,000 Contingent shares 875 $ 83,319 Total fair value purchase consideration $ 592,822 The warrants are exercisable at $1.72 each and will expire on December 15, 2024. As a result of the Reverse Split (see Note 1(b)), each warrant converts into 0.01428571 common share or 70 warrants to receive one common share of KWESST. We issued the 875 contingent common shares to the sellers in April 2022 following the fulfillment of the financial milestone as defined in the share purchase agreement. We have estimated the fair value as follows: • Common shares • Warrants • Contingent shares The net cash inflow as at the closing of the acquisition was as follows: Cash assumed on acquisition $ 162,547 less: consideration paid in cash - Net cash inflow on acquisition $ 162,547 Net Assets Acquired The purchase consideration was allocated to Police Ordnance's net assets as follows: Total purchase consideration at fair value $ 592,822 Police Ordnance's net assets: Cash 162,547 Trade and other receivables 104,432 Inventories 352,685 Intangible assets: Purchase orders 100,000 Customer relationships 50,000 ARWEN TM 44,000 Accounts payable and accrued liabilities 82,963 Corporate tax liability 32,338 Contract liabilities 29,861 Borrowings 26,238 Deferred tax liabilities 49,442 Net assets at fair value $ 592,822 As a result of the above purchase price allocation, we have recorded no goodwill for the Police Ordnance Acquisition. Impact on KWESST's Results of Operations The results of operations of Police Ordnance are included in these consolidate statements of net loss and comprehensive loss from December 16, 2021. For the year ended September 30, 2022, Police Ordnance contributed revenue of $355,296 and net loss of $198,353 to our consolidated results. If the acquisition had occurred on October 1, 2021, management estimates that Police Ordnance would have contributed approximately $846,600 of revenue and approximately $31,000 of net profit to our operating results for the year ended September 30, 2022, respectively. In determining these amounts, we have assumed that the fair value adjustments that arose on the date of the acquisition would have been the same if the acquisition had occurred on October 1, 2021. We incurred immaterial acquisition-related costs. b) LEC System On April 29, 2021, we acquired the Low Energy Cartridge technology from DEFSEC, a proprietary non-lethal cartridge-based firing system (subsequently branded as PARA OPS TM TM (i) (ii) (iii) (iv) As DEFSEC is a private company owned by our Executive Chairman, this asset acquisition is a related party transaction. We relied on exemptions from the formal valuation and minority shareholder approval requirements available under Multilateral Instrument 61-101, Protection of Minority Security Holders in Special Transactions. We accounted for the acquisition of the PARA OPS TM Share-Based Payment. The purchase consideration consisted of: • 14,286 common shares of KWESST; and • 500,000 warrants to purchase our common shares at $0.70 each per 1/70 of a common share (70 warrants for one common share); 25% vesting on the first anniversary of the closing of the acquisition and 25% per annum thereafter. These warrants will expire on April 29, 2026. Additionally, we will pay 7% royalty on annual sales of the PARA OPS TM The minimum annual royalty payments are as follows: Date Amount April 29 2023 $ 150,000 April 29 2024 $ 150,000 April 29 2025 $ 200,000 April 29 2026 $ 200,000 April 29 2027 $ 250,000 April 29 2028 $ 250,000 April 29 2029 $ 300,000 April 29 2030 $ 300,000 April 29 2031 $ 350,000 April 29 2032 $ 350,000 Total $ 2,500,000 The royalty payment obligation of the Purchase Agreement ("Agreement") will expire in 20 years unless terminated earlier under the terms set out in the Agreement. At our sole discretion, we may terminate this Agreement for convenience, including if market conditions for sales of the PARA OPS TM TM The purchase price was determined as follows: Number Fair Value Common shares 14,286 $ 1,290,000 Warrants 500,000 $ 425,000 Minimum royalty payments $ 1,191,219 Total $ 2,906,219 Identifiable intangible assets Technology asset $ 2,906,219 We estimated the fair value as follows: • Common shares • Warrants • Minimum royalty payments During the year ended September 30, 2022, we recorded $159,451 of accretion cost relating to the discounted minimum royalty payments, which is included in net finance costs in the consolidated statements of net loss and comprehensive loss (2021 - $64,537). As at September 30, 2022, $1,265,207 of accrued royalties liability was outstanding (2021 - $1,105,756). c) Reverse acquisition On September 17, 2020, Foremost Ventures Corp. ("Foremost") completed the Qualifying Transaction ("QT") with KWESST Inc. pursuant to the policies of the TSX-V. Prior to the completion of the QT, Foremost effected a consolidation of its outstanding common shares on the basis of one post-consolidation common share for every 326.9 pre-consolidation common shares. The QT was done by way of a three-cornered amalgamation (the "Amalgamation") pursuant to which, among other things: (i) (ii) (iii) Immediately following the QT, there were 589,517 shares of KWESST outstanding, of which 576,681 were held by the former shareholders of KWESST Inc. (representing approximately 97.8% of the outstanding shares of the Company) and 12,836 were held by the shareholders of Foremost prior to the QT. Accordingly, this transaction was accounted for as a reverse acquisition where KWESST Inc. was deemed to be the acquirer for accounting purposes. The reverse acquisition of Foremost was accounted for under IFRS 2, Share-based Payment The following represents management's estimate of the fair value of the net assets acquired and total consideration transferred at September 17, 2020, the closing date of the QT. Number of common shares issued to Foremost shareholders 12,836 KWESST's stock price at closing of reverse acquisition (1) $ 49.00 Common shares $ 628,949 Options 41,155 Total consideration transferred $ 670,104 (1) The total fair value consideration was allocated to Foremost's net assets as follows: Total fair value consideration $ 670,104 Foremost's net assets (liabilities): Cash $ 78,589 Other receivables 1,900 Accounts payable and accrued liabilities (225,088 ) Net assets (liabilities) at fair value (144,599 ) Residual balance allocated to listing expense (included in M&A costs) 814,703 Total $ 670,104 The results of operations of Foremost are included in these consolidated statements of comprehensive loss from September 17, 2020. The listing expense of $814,703 is a non-cash item - see consolidated statements of cash flows. In addition, 14,286 common shares with fair value of $700,000 were issued to two M&A / capital market advisors for successfully assisting KWESST to complete the QT. |
Trade and other receivables
Trade and other receivables | 9 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Sep. 30, 2022 | |
Trade and other receivables [abstract] | ||
Trade and other receivables [Text Block] | 5. Trade and other receivables The following table presents trade and other receivables for KWESST: September 30, 2020 December 31, 2019 Trade receivables $ 210,795 $ 1,191 Sales tax recoverable 142,797 55,684 Investment tax credits refundable 127,325 162,928 Total $ 480,917 $ 219,803 There was no impairment of trade and other receivables during the nine months ended September 30, 2020 (2019 - $nil). | 5. Trade and other receivables The following table presents a breakdown of our trade and other receivables: September 30, September 30, 2022 2021 Trade receivables $ 114,877 $ - Unbilled revenue 8,881 308,728 Sales tax recoverable 48,124 183,761 Investment tax credits refundable - 206,762 Total $ 171,882 $ 699,251 There was no impairment of trade and other receivables during the year ended September 30, 2022 (2021 - $nil). The following table presents changes in unbilled receivables: September 30, September 30, 2022 2021 Balance, beginning of year $ 308,728 $ - Revenue billed during the year (308,728 ) Revenue in excess of billings, net of amounts transferred to trade accounts receivable 8,881 308,728 Amounts written off - - Balance, end of year $ 8,881 $ 308,728 Current $ 8,881 $ 308,728 Non-current $ - $ - |
Inventories
Inventories | 12 Months Ended |
Sep. 30, 2022 | |
Disclosure Of Inventories [Abstract] | |
Inventories [Text Block] | 6. Inventories The following table presents a breakdown of our inventories: September 30, September 30, 2022 2021 Finished goods $ 49,643 $ - Work-in-progress 21,350 - Raw materials 322,545 90,299 Total $ 393,538 $ 90,299 There was no impairment of inventories during the year ended September 30, 2022 (2021 - $nil). |
Property and equipment
Property and equipment | 9 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Sep. 30, 2022 | |
Disclosure of detailed information about property, plant and equipment [abstract] | ||
Property and equipment [Text Block] | 6. Property and equipment The following is summary of changes in property and equipment for KWESST: Cost Computer Computer Office R&D Leasehold Total Balance at December 31, 2018 $ - $ 8,145 $ 31,873 $ 41,379 $ 8,607 $ 90,004 Additions 14,073 - 908 5,209 - 20,190 Disposals - - - - - - Balance at December 31 2019 $ 14,073 $ 8,145 $ 32,781 $ 46,588 $ 8,607 $ 110,194 Additions 18,734 - 49,060 7,046 59,090 133,930 Disposals - - - - (8,607 ) (8,607 ) Balance at September 30, 2020 $ 32,807 $ 8,145 $ 81,841 $ 53,634 $ 59,090 $ 235,517 Accumulated depreciation Computer Computer Office R&D Leasehold Total Balance at December 31, 2018 $ - $ 3,396 $ 9,587 $ 5,257 $ 2,497 $ 20,737 Amortization for 12 months 241 2,715 6,556 8,102 1,721 19,335 Balance at December 31, 2019 $ 241 $ 6,111 $ 16,143 $ 13,359 $ 4,218 $ 40,072 Amortization for 9 months 5,821 1,526 6,149 7,478 8,434 29,408 Disposals - - - - (8,607 ) (8,607 ) Balance at September 30, 2020 $ 6,062 $ 7,637 $ 22,292 $ 20,837 $ 4,045 $ 60,873 Carrying value at December 31, 2019 $ 13,832 $ 2,034 $ 16,638 $ 33,229 $ 4,389 $ 70,122 Carrying value at September 30, 2020 $ 26,745 $ 508 $ 59,549 $ 32,797 $ 55,045 $ 174,644 | 7. Property and equipment Office LRIP Computer Computer furniture and R&D Leasehold Sales demo Cost equipment software equipment equipment (1) equipment improvements equipment Total Balance, September 30, 2020 $ 32,807 $ 8,145 $ 81,841 $ - $ 53,634 $ 59,090 $ - $ 235,517 Additions 30,778 - 11,211 - 165,030 58,147 548,626 813,792 Disposals (3,828 ) (8,145 ) (2,936 ) - (724 ) - - (15,633 ) Balance at September 30, 2021 $ 59,757 $ - $ 90,116 $ - $ 217,940 117,237 $ 548,626 $ 1,033,676 Additions 50,849 5,129 10,817 77,559 21,864 19,800 1,460 187,478 Disposals (3,800 ) - - - - - - (3,800 ) Balance at September 30, 2022 $ 106,806 $ 5,129 $ 100,933 $ 77,559 $ 239,804 $ 137,037 $ 550,086 1,217,354 Office Computer Computer furniture and Moulding R&D Leasehold Sales demo Accumulated depreciation equipment software equipment equipment equipment improvements equipment Total Balance, September 30, 2020 $ 6,062 $ 7,637 $ 22,292 $ - $ 20,837 $ 4,045 - $ $60,873 Depreciation for the year 13,966 508 18,759 - 17,462 12,489 16,444 79,628 Disposals (1,630 ) (8,145 ) (687 ) - (12 ) - - (10,474 ) Balance at September 30, 2021 $ 18,398 $ - $ 40,364 $ - $ 38,287 $ 16,534 16,444 $ 130,027 Depreciation for the year 26,762 1,254 19,067 7,002 46,219 27,915 129,262 257,481 Disposals (2,635 ) - - - - - - (2,635 ) Balance at September 30, 2022 $ 42,525 $ 1,254 $ 59,431 $ 7,002 $ 84,506 $ 44,449 $ 145,706 $ 384,873 Carrying value at September 30, 2021 $ 41,359 $ - $ 49,752 $ 49,752 $ 179,653 $ 100,703 $ 532,182 $ 903,649 Carrying value at September 30, 2022 $ 64,281 $ 3,875 $ 41,502 $ 70,557 $ 155,298 $ 92,588 $ 404,380 $ 832,481 (1) TM |
Right-of-use assets
Right-of-use assets | 9 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Sep. 30, 2022 | |
Disclosure Of Right Of Use Assets [Abstract] | ||
Right-of-use assets [Text Block] | 8. Right-of-use assets The following table presents right-of-use assets for KWESST: Offices Printer Total Balance at December 31, 2018 $ 254,159 $ 13,120 $ 267,279 Depreciation (76,248 ) (6,559 ) (82,807 ) Balance at December 31, 2019 $ 177,911 $ 6,561 $ 184,472 Additions 571,604 - 571,604 Termination (139,787 ) - (139,787 ) Depreciation (92,567 ) (3,282 ) (95,849 ) Balance at September 30, 2020 (as previously reported) 517,161 3,279 520,440 Correction of an error (192,864 ) - (192,864 ) Balance at September 30, 2020 (as adjusted) $ 324,297 $ 3,279 $ 327,576 During the nine months ended September 30, 2020, KWESST terminated an office lease agreement due to breach of contract by the former landlord and de-recognized the related right-of-use asset and lease obligations (see Note 12). As a result, KWESST entered into a new office lease agreement with a 74-month lease term starting from March 1, 2020. In connection with this new lease, KWESST made a total deposit of $33,726 to be released only at the end of this lease. This deposit was initially recorded at fair value, discounted using the implied interest rate in the lease. At September 30, 2020, $19,341 was the carrying value and reported as non-current deposit in the consolidated statements of financial position. Subsequently, during the year ended September 30, 2021, management made an adjustment for a correction in the application of IFRS 16, Leases, to the new office lease entered in the prior year, whereby future variable payments were erroneously included in the calculation of the lease obligations. The following summarizes the effects of this correction to the prior year's comparatives. Consolidated statements of financial position as at September 30, 2020: Previously Adjustment Adjusted Trade and other receivables $ 479,291 $ 1,626 $ 480,917 Right-of-assets $ 520,440 $ (192,864 ) $ 327,576 Deposit (non-current) $ 22,337 $ (2,996 ) $ 19,341 Total assets $ 5,507,011 $ (194,234 ) $ 5,312,777 Lease obligations (current) $ 78,358 $ (34,230 ) $ 44,128 Lease obligations (non-current) $ 496,394 $ (188,485 ) $ 307,909 Total liabilities $ 1,650,628 $ (222,715 ) $ 1,427,913 Deficit $ (6,102,058 ) $ 28,481 $ (6,073,577 ) Consolidated statements of changes in shareholders' equity (deficit) for the nine months ended September 30, 2020: Previously Adjustment Adjusted Deficit $ (6,102,058 ) $ 28,481 $ (6,073,577 ) Total shareholders' equity (deficit) $ 3,856,383 $ 28,481 $ 3,884,864 | 8. Right-of-use assets The following table presents our right-of-use assets: Offices Printer Total Balance at September 30, 2020 324,297 3,279 327,576 Depreciation (58,083 ) (3,279 ) (61,362 ) Balance at September 30, 2021 $ 266,214 $ - $ 266,214 Depreciation (58,083 ) - (58,083 ) Balance at September 30, 2022 $ 208,131 $ - $ 208,131 In connection with our current lease, we made a total deposit of $33,726 to be released only at the end of this lease. This was initially recorded at fair value, discounted using the implied interest rate in the lease. At September 30, 2022, $23,604 (2021 - $21,367) was the carrying value and reported as non-current deposit in the consolidated statements of financial position. |
Intangible assets
Intangible assets | 9 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Sep. 30, 2022 | |
Disclosure of detailed information about intangible assets [abstract] | ||
Intangible assets [Text Block] | 7. Intangible assets The following table presents intangible assets for KWESST: Development Technology Total Cost Balance at December 31, 2019 $ - $ - $ - Additions 163,230 - 163,230 Additions through acquisition (Note 4) - 481,472 481,472 Balance at September 30, 2020 $ 163,230 $ 481,472 $ 644,702 During the nine months ended September 30, 2020, KWESST capitalized development costs of $163,230 in connection with a funded development project to support a U.S. military customer, featuring KWESST's signature Tactical Awareness and Situational Control System ("TASCS") - see Note 26 (a). As disclosed in Note 4(b), KWESST acquired technology assets of $481,472, comprising intellectual property rights, including trademark rights, of the GhostStep® Technology, an electronic decoy system. Management has estimated a useful life of five years; however, as this technology has not yet reached commercialization, no amortization charge was recorded for the nine months period ended September 30, 2020. | 9. Intangible assets The following table shows a breakdown of our intangible assets: TASCS Phantom TM PARA OPS TM PARA OPS TM ARWEN TM Customer Purchase Cost System System System Patent Tradename Relationships Orders Total Balance at September 30, 2020 $ 163,230 $ 481,472 $ - $ - $ - $ - $ - $ 644,702 Additions - 83,228 - - - - - 83,228 Acquisition (Note 4(b)) - - 2,906,219 - - - - 2,906,219 Transferred to cost of sales (107,854 ) - - - - - - (107,854 ) Impairment charge (55,376 ) - - - - - - (55,376 ) Balance at September 30, 2021 - $ 564,700 $ 2,906,219 $ - $ - $ - $ - $ 3,470,919 Additions - 584,885 562,996 28,783 - - - 1,176,664 Acquisition (Note 4(a)) - - - - 44,000 50,000 100,000 194,000 Amortization - - - - (6,968 ) (3,959 ) - (10,927 ) Recognition of open orders - - - - - - (87,802 ) (87,802 ) Balance at September 30, 2022 $ - $ 1,149,585 $ 3,469,215 $ 28,783 $ 37,032 $ 46,041 $ 12,198 $ 4,742,854 The balance at September 30, 2022 for Phantom TM TM In connection with Police Ordnance Acquisition (see Note 4(a)), we have recorded the following intangible assets at fair value: ARWEN TM |
Accounts payable and accrued li
Accounts payable and accrued liabilities | 9 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Sep. 30, 2022 | |
Trade and other current payables [abstract] | ||
Accounts payable and accrued liabilities [Text Block] | 9. Accounts payable and accrued liabilities The following table presents the accounts payable and accrued liabilities for KWESST: September 30, December 31, Trade payable $ 493,027 $ 126,481 Accrued liabilities 188,265 29,822 Payroll taxes payable 67,229 - Salary and vacation payable 65,722 29,343 Other 4,031 13,041 Total $ 818,274 $ 198,687 | 10. Accounts payable and accrued liabilities The following table presents a breakdown of our accounts payable and accrued liabilities: September 30, September 30, 2022 2021 Trade payable $ 2,292,954 $ 620,041 Accrued liabilities 1,045,409 384,239 Salary, bonus and vacation payable 1,116,203 122,230 Interest payable 4,915 - Payroll taxes payable - 692 Total $ 4,459,481 $ 1,127,202 |
Related party transactions
Related party transactions | 9 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Sep. 30, 2022 | |
Disclosure of transactions between related parties [abstract] | ||
Related party transactions [Text Block] | 10. Related party transactions As disclosed in Note 1, the 1-for-70 Reverse Split effected on October 28, 2022 has been applied retrospectively herein. Key management personnel compensation Key management personnel are those having authority and responsibility for planning, directing and controlling the activities of KWESST directly or indirectly, including any directors (executive and nonexecutive) of KWESST. The key management personnel of KWESST are the executive management team and Board of Directors, who collectively control approximately 38% of the issued and outstanding common shares of KWESST at September 30, 2020. Key management personnel compensation comprised the following: Nine months September 30, 2020 Twelve months Wages and benefits $ 165,769 $ 48,343 Consulting fees 145,000 30,000 Directors compensation - - Share-based compensation 24,959 - Total $ 335,728 $ 78,343 The consulting fees relate to compensation paid to KWESST's Executive Chairman (via his private corporation, DEFSEC Corporation), including a one-time $15,000 payment for prior year expenses in accordance with the consulting agreement. Related party loans The following table summarizes the related party loans. Loans from (1) Employee (2), (5) Loans from (3), (4) Total Balance at December 31, 2018 $ 612,171 $ 81,253 $ 191,789 $ 885,213 Additions 309,912 - 772 310,684 Transferred to convertible debentures - - (192,561 ) (192,561 ) Converted into common shares (649,500 ) - - (649,500 ) Converted into warrants (19,858 ) - - (19,858 ) Repayment of loans (45,513 ) (25,000 ) - (70,513 ) Accrued interest 22,706 3,657 - 26,363 Balance at December 31, 2019 $ 229,918 $ 59,910 $ - $ 289,828 Repayment of loans (30,000 ) (50,000 ) - (80,000 ) Accrued interest 7,174 1,274 - 8,448 Balance at September 30, 2020 $ 207,092 $ 11,184 $ - $ 218,276 (1) In prior years, KWESST's CEO and his spouse (major shareholders) advanced funds to KWESST to fund its working capital requirement s . T he loans are due on demand and accrue annual interest at TD Bank prime plus 1.55% . (2) In prior years, KWESST borrowed funds from an employee to fund its working c apital requirements. Th e loan bears interest at 5% per annum and is due upon demand. This loan was fully repaid during the first quarter of fiscal 2021. (3) On April 20, 20 1 8, KWESST issued two Subscriptions for Revenue Sharing in the principal amount of $50,000 each to an investor. An additional amount of $26,961 was invested to the Company on December 14, 2018. The total loan o f $126,960 and was subsequently reclassified as convertible notes on October 23, 2019 (see Note 15 ). (4) On June 5, 2018, KWESST issued a Subscription for Revenue Sharing in the principal amount of $64,829 (USD$50,000) to one of KWESST's officer. This loan was subsequently reclassified as convertible debentures on October 23, 2019 (see Note 15 ). Other related party transactions during the nine months ended September 30, 2020: Two directors of KWESST were investors in the 2019 convertible notes (see Note 15), in which KWESST incurred interest expense of $6,585 on these two convertible notes. This interest expense was converted to KWESST common shares. KWESST hired a consulting firm to provide capital markets advisory services, including assistance to complete KWESST's Qualifying Transaction with Foremost (see Note 4 (a)) and to raise capital. This consulting firm is also a significant shareholder and holds 1,500,000 warrants (each warrant is exercisable into 1/70 of a common share) and 2,857 options of KWESST, including securities held by the owner of this firm. Total cash and share-based remuneration amounted to $494,325. The lease for the 3-D printer was with a private company owned by KWESST's President and CEO and his spouse (see Note 12). At September 30, 2020 and December 31, 2019, there was no outstanding amount in accounts payable and accrued liabilities due to officers and directors of KWESST. | 11. Related party transactions Key management personnel compensation Key management personnel are those having authority and responsibility for planning, directing and controlling the activities of KWESST directly or indirectly, including any of our directors (executive and nonexecutive). Our key management personnel are the executive management team and Board of Directors, who collectively control approximately (28.3%) of the issued and outstanding common shares of KWESST at September 30, 2022 (2021 - 31.5%, 2020 - 38.0%). Key management personnel compensation comprised the following: Year ended Year ended Nine months ended September 30, September 30, September 30, 2022 2021 2020 Wages and benefits $ 641,338 $ 427,252 $ 165,769 Consulting fees 529,529 180,000 145,000 Directors compensation 70,000 85,000 - Share-based compensation 860,400 988,716 24,959 Total $ 2,101,267 $ 1,680,968 $ 335,728 The consulting fees relate to compensation to our Executive Chairman (via his private corporation, DEFSEC Corp), including a bonus for the year ended September 30, 2022, which was approved by our Board of Directors and paid only after the U.S. IPO and Canadian Offering (see Note 27(a)). It also includes consulting fees payable to an independent director for advisory services relating to PARA OPS TM Related party loans For the year ended September 31, 2022, we did not enter into any related party loans. The following table summarizes the changes in related party loans in the prior year. CEO Employee loan loan Total Balance, September 30, 2020 $ 207,092 $ 11,184 $ 218,276 Accrued interest 4,513 68 4,581 Repayment of loans (211,605 ) (11,252 ) (222,857 ) Balance, September 30, 2021 $ - $ - $ - The CEO and employee loans accrued interest at TD Bank prime plus 1.55% and 5%, respectively. Other related party transactions: • In April 2021, two directors and the CFO of KWESST participated in the brokered private placement (see Note 15(a)); collectively, they purchased 1,029 Units for a total consideration of $90,000. This transaction was recorded at fair value. • In March 2022, two directors, the Executive Chairman, and the CFO of KWESST participated in the March 2022 Loans for an aggregate amount of $74,000 and received a total of 529 bonus common shares (see Note 12). • In July 2022, one director, the Executive Chairman, and the CFO of KWESST participated in the July 2022 Offering (see Note 15(a)); collectively, they purchased 5,813 Units for a total consideration of $87,500. This transaction was recorded at fair value. • In August 2022, our Executive Chairman and CFO advanced a total of $60,000 to KWESST for employee payroll purposes. This advance was repaid on August 30, 2022. At September 30, 2022 there was $672,531 outstanding amount in accounts payable and accrued liabilities due to our officers and directors for unpaid wages, bonuses, director fees and expense reimbursements. |
Borrowings
Borrowings | 9 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Sep. 30, 2022 | |
Borrowings [abstract] | ||
Borrowings [Text Block] | 11. Borrowings In April 2020, KWESST was approved and received a $40,000 term loan with TD Bank under the Canada Emergency Business Account (''CEBA Term Loan'') program funded by the Government of Canada. The CEBA Term Loan is non-interest and can be repaid at any time without penalty. KWESST has recorded a fair value of $30,904 at inception, discounted using its incremental borrowing rate of 10%. The difference of $9,096 between the fair value and the total amount of CEBA Term Loan received has been recorded as a gain on government grant for the nine months period ended September 30, 2020. See Note 26(a). | 12. Borrowings CEBA Term February 2021 March 2022 August 2022 Total Loans Loan Loans Loans Borrowings Balance, September 30, 2020 $ 32,273 $ - $ - $ - $ 32,273 Additional borrowings 20,000 306,000 - - 326,000 Gain on government grant (3,514 ) - - - (3,514 ) Accrued interest 4,492 4,527 - - 9,019 Repayment - (310,527 ) - - (310,527 ) Balance, September 30, 2021 $ 53,251 $ - $ - $ - $ 53,251 Assumed from acquisition (Note 4) 26,238 - - - 26,238 Issuance at fair value - - 1,634,283 475,591 2,109,874 Deferred financing fees - - (74,055 ) (76,354 ) (150,409 ) Net borrowings 79,489 - 1,560,228 399,237 2,038,954 Adjustment (5,496 ) - - - (5,496 ) Accrued interest and accretion expense 4,803 - 304,922 11,588 321,313 Foreign exchange loss - - - 24,523 24,523 Interest paid - - (100,520 ) - (100,520 ) Balance, September 30, 2022 $ 78,796 $ - $ 1,764,630 $ 435,348 $ 2,278,774 Current $ - $ - $ 1,764,630 $ 435,348 $ 2,199,978 Non-current 78,796 - - $ 78,796 Total $ 78,796 $ - $ 1,764,630 $ 435,348 $ 2,278,774 August 2022 Loans On August 25, 2022, we closed two unsecured loans in the amount of USD$200,000 per loan with a third-party lender ("Lender") for an aggregate amount of USD$400,000 (the "August 2022 Loans"). The August 2022 Loans bear interest at a rate of 6.0% per annum, compounded monthly and not in advance, and have a maturity of twelve months, with KWESST having the option to repay the whole or any part of the August 2022 Loans, without penalty or premium, at any time prior to the close of business on the maturity date. On repayment of the August 2022 Loans, we will pay 110% of the principal amount plus accrued interest on the August 2022 Loans. As part of the terms of one of the August 2022 Loans, we issued an aggregate of 4,239 common shares to the Lender (the "Bonus Shares"), being an amount equal to twenty percent (20%) of USD$200,000, converted to CAD$ at an exchange rate of $1.2983, divided by the market price of our common shares on the TSX-V at market close on August 24, 2022, being $12.25. The Bonus Shares were issued in accordance with applicable prospectus exemptions under Canadian securities laws. As a result of issuing common shares and debt for the first loan of USD$200,000 (or $260,698), we allocated the gross proceeds to these two financial instruments based on their relative fair value. To measure the fair value of the loan, we used the income approach and estimated a market discount rate of 24% to discount the future cash flows of the loan resulting in an estimated fair value of $214,893. Accordingly, we allocated $214,893 of the $260,698 to the first loan and $45,804 to share capital for the bonus common shares issued (see Note 15(a)). Concurrently with the closing of the August 2022 Loans, our Executive Chairman and President and Chief Executive Officer (the "KWESST Principals") entered into call option agreements with the Lender whereby the Lender will have the option, pursuant to the terms and conditions of the call option agreements, to purchase 10,591 common shares held by the KWESST Principals at a price of $12.25 for a period of five years. Additional free-trading common shares may be offered by the KWESST Principals to the Lender should we elect to proceed with a share-for-debt transaction in connection with one of the Loans. KWESST is not a party to the call option agreements. In connection with the August 2022 Loans, we paid a cash finder's fee to a third-party intermediary in an amount of USD$32,000. March 2022 Loans On March 11, 2022, we closed a unsecured loan financing with various lenders in an aggregate amount of $1,800,000 and an additional $200,000 on March 15, 2022, for a total of $2,000,000 (the "March 2022 Loans"). Certain directors and officers participated in this financing for an aggregate amount of $74,000. The March 2022 Loans bear interest at a rate of 9.0% per annum, compounded monthly and not in advance, and have a maturity of thirteen months, with KWESST having the option to repay the whole or any part of the March 2022 Loans, without penalty or premium, at any time prior to the close of business on the maturity date. The principal amount is due only at maturity. As part of the terms of the March 2022 Loans, we issued an aggregate of 14,286 bonus common shares to the lenders. As a result of issuing common shares and debt for a total combined cash consideration of $2,000,000, we allocated the gross proceeds to these two financial instruments based on their relative fair value. To measure the fair value of the March 2022 Loans, we used the income approach and estimated a market discount rate of 22% to discount the future cash flows of the March 2022 Loans resulting in an estimated fair value of $1,634,112. Accordingly, we allocated $1,634,112 of the $2,000,000 to March 2022 Loans and $365,888 to share capital for the bonus common shares issued (see Note 12(a)). The total offering costs were $90,636, $74,055 of which was allocated to deferred financing fees and $16,581 allocated to share offering costs. The deferred financing fees are recognized as a reduction of the gross borrowings to be accreted over the life of the March 2022 Loans as a financing cost and the share offering costs were recognized as a reduction to common shares. As the March 2022 Loans mature in April 2023, we presented these as current borrowings in the consolidated financial position. February 2021 Loan On February 24, 2021, we entered into an unsecured loan agreement with a private fund managed by a KWESST shareholder to borrow $306,000 for general corporate purposes. The interest rate on this loan was 0.5% per month. On May 27, 2021, we repaid the loan, including accrued interest, for a total of $310,527. CEBA Term Loans In December 2020, the Canadian Federal Government amended the CEBA Term Loan program to increase the loan amount by $20,000 to $60,000. We borrowed $40,000 during the nine-month period ended September 30, 2020, and an additional $20,000 during the fiscal year ended September 30, 2021. As a result of the Police Ordnance Acquisition (see Note 4(a)), we assumed an additional CEBA Term Loan of $40,000 during fiscal year ended September 30, 2022. The CEBA Term Loans are initially recorded at fair value, discounted based on our estimated incremental borrowing rate. This resulted in recording a gain on government grant of $3,514 for the year ended September 30, 2021 (2020 - $9,096). Effective January 1, 2021, the CEBA Term Loans were automatically converted to a 2-year interest free term loan. This was further amended on January 12, 2022, where the government of Canada announced the repayment deadline for the CEBA Term Loans to qualify for partial loan forgiveness is being extended from December 31, 2022, to December 31, 2023, for all eligible borrowers in good standing. Repayment on or before the new deadline of December 31, 2023, will result in loan forgiveness of up to a third of the loans. Due to our financial condition at September 30, 2022 and 2021, we have not recorded the potential forgivable amount in the event we repay the CEBA Term Loans prior to December 31, 2023. RBC Credit Facility We maintain corporate credit cards for our key employees and a foreign exchange line of credit with Royal Bank of Canada ("RBC"). To provide security, we entered into a cash collateral agreement for $30,000 and a general security agreement providing a first lien on all assets. The $30,000 was invested in a short-term guaranteed investment certificate. See Note 27(c), Subsequent Events - Loan Repayments. |
Lease obligations
Lease obligations | 9 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Sep. 30, 2022 | |
Presentation of leases for lessee [abstract] | ||
Lease obligations [Text Block] | 12. Lease obligations During the nine months ended September 30, 2020, KWESST terminated an office lease and entered into a long-term office lease contract. The office lease includes the right to renew for an additional five years following its expiry on April 30, 2026. Management has not included the renewal option because it was deemed too uncertain whether KWESST would renew at this time. Under the new office lease, KWESST benefits from the following lease inducements: • Free rent from inception (March 1, 2020) to November 1, 2020; and • Free rent from November 1, 2021, to March 1, 2022. When measuring the lease obligation, the Company discounted the remaining lease payments using the incremental estimated borrowing rate of Company of 10% per annum at the time of closing the new lease agreement. The following table presents lease obligations for KWESST: Offices Printer Total Current Portion Non-current Balance, December 31, 2018 $ 266,292 $ 13,761 $ 280,053 $ 77,367 $ 202,686 Lease payments (including interest) (94,270 ) (7,620 ) (101,890 ) - - Interest expense 23,441 1,082 24,523 - - Balance, December 31, 2019 $ 195,463 $ 7,223 $ 202,686 $ 85,468 $ 117,218 Addition 347,640 - 347,640 Termination (157,315 ) - (157,315 ) Lease payments (including interest) (62,816 ) (7,620 ) (70,436 ) Interest expense 29,065 397 29,462 Balance, September 30, 2020 (as adjusted) $ 352,037 $ - $ 352,037 $ 44,128 $ 307,909 Refer to Note 7 regarding the correction of an error in the application of IFRS 16. The termination of the former lease resulted in the de-recognition of the lease obligation and related unamortized book value of the right-of-use asset, resulting in a gain of $17,527. This was included in the net finance costs for the nine months ended September 30, 2020. The following table presents the contractual undiscounted cash flows for the lease obligations: September 30, December 31, Less than one year $ 78,000 $ 101,890 One to five years 390,000 125,693 Total $ 468,000 $ 227,583 | 13. Lease obligation We have entered into a long-term office lease contract which expires on April 30, 2026. The office lease includes the right to renew for an additional five years following its expiry. Management has not included the renewal option because it was deemed too uncertain whether we would renew at September 30, 2022. Under the current office lease agreement, we have benefited from the following lease inducements: • Free rent from inception (March 1, 2020) to November 1, 2020; and • Free rent from November 1, 2021, to March 1, 2022. The following table presents the movement in our lease obligation for the respective periods: Current Non-current Offices Portion portion Balance, September 30, 2020 $ 352,037 $ 44,128 $ 307,909 Lease payments (including interest) (78,000 ) - - Interest expense 33,872 - - Balance at September 30, 2021 $ 307,909 $ 32,288 $ 275,621 Lease payments (including interest) (62,400 ) - - Interest expense 30,112 - - Balance at September 30, 2022 $ 275,621 $ 69,150 $ 206,471 The following table presents the contractual undiscounted cash flows for the lease obligations: September 30, September 30, 2022 2021 Less than one year $ 93,600 $ 62,400 One to five years 234,000 327,600 Total $ 327,600 $ 390,000 |
Contract Liabilities
Contract Liabilities | 9 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Sep. 30, 2022 | |
Contract liabilities [abstract] | ||
Contract Liabilities [Text Block] | 13. Deferred revenue The following table presents the changes in deferred revenue: September 30, 2020 December 31, 2019 Balance, beginning of period $ - $ - Amounts invoiced and revenue deferred 7,053 - Recognition of deferred revenue included in the balance at the beginning of period - - Balance, end of period $ 7,053 $ - | 14. Contract Liabilities The following table presents the changes in contract liabilities: September 30, September 30, 2022 2021 Balance, beginning of fiscal year $ - $ 7,053 Acquired in acquisition of POC (see Note 4(a)) 29,759 - Amounts invoiced and revenue deferred 17,512 - Recognition of deferred revenue included in the balance at the beginning of period - (7,053 ) Balance, end of fiscal year $ 47,271 $ - |
Financial derivative liabilitie
Financial derivative liabilities | 9 Months Ended |
Sep. 30, 2020 | |
Disclosure of maturity analysis for derivative financial liabilities [abstract] | |
Financial derivative liabilities [Text Block] | 14. Financial derivative liabilities In connection with the issuance of the 2019 Convertible Notes (see Note 15), management determined that the conversion feature was a financial derivative liability which is remeasured at fair value at each reporting period (see Note 20). The following table summarizes the financial derivative liabilities: Total Balance at December 31, 2018 $ 111,953 Fair value adjustment when notes were converted into common shares (111,953 ) Fair value of financial derivative liabilities on initial recognition 30,688 Fair value adjustment (1,225 ) Balance at December 31, 2019 29,463 Fair value adjustment (29,463 ) Balance at September 30, 2020 $ - |
Convertible notes
Convertible notes | 9 Months Ended |
Sep. 30, 2020 | |
Disclosure of detailed information about borrowings [abstract] | |
Convertible notes [Text Block] | 15. Convertible notes As disclosed in Note 1, the 1-for-70 Reverse Split effected on October 28, 2022 has been applied retrospectively herein. The following table presents the convertible notes for KWESST: Balance at December 31, 2018 $ 521,515 Related party loans transferred to convertible notes (Note 10) 192,561 Converted into common shares (Note 16) (620,897 ) Repayment of debt (31,644 ) Less fair value of conversion feature (30,688 ) Accrued interest 74,707 Accretion expenses 105,265 Balance at December 31, 2019 210,819 Accrued interest 16,769 Accretion expenses 28,130 Converted in common shares (Note 16) (255,718 ) Balance at September 30, 2020 $ - Activities in 2019 During the year ended December 31, 2018, KWESST issued convertible notes to investors in the total principal amount of $601,961 bearing an interest of 10% per annum. On October 23, 2019, KWESST converted $560,007 of debt and $60,890 of interest into 44,350 common shares at a price of $14.00 relating to all debts noted above and repaid $31,644 debt by cash. The remaining $234,515 was issued as new convertible debentures at a rate of 10% per annum and due on October 23, 2021. Upon the occurrence of a Liquidity Event, the new convertible note will automatically convert into common shares of KWESST at a conversion rate equal to a 20% discount to the value assigned to the common shares of KWESST under such Liquidity Event for the entire amount of the principal amount plus all accrued interest. "Liquidity Event" means either (1) the completion of an initial public offering which results in the common shares of KWESST being listed and posted for trading or quoted on any of the Toronto Stock Exchange, the TSX Venture Exchange, the New York Stock Exchange, the American Stock Exchange, the Nasdaq National Market, the London Stock Exchange or any successor exchange or market thereto; or (2) the closing of a merger, amalgamation plan of arrangement or other transaction or series of related transactions resulting in the holders of common shares receiving consideration in securities listed on a Qualified Exchange. The conversion feature of convertible debentures is presumed to be classified as a derivative financial liability unless it meets all the criteria to recognize as equity instrument under IAS 32 - Financial Instruments: Presentation. One of criteria is that the conversion feature exchanges a fixed amount of shares for a fixed amount of cash ("fixed for fixed"). The convertible debentures are convertible to % of the shares of the Company on a fully diluted basis which is not a fixed amount of shares, therefore the fixed for fixed criteria is not met. As such, the conversion feature was classified as financial derivative liabilities instead of an equity instrument. KWESST separated the convertible debentures into two components at initial recognition, with the debt carried at amortized cost, and the conversion feature carried at fair value as financial derivative liabilities. Activities in 2020 As disclosed in Note 4(a), a Liquidity Event occurred which resulted in the conversion of the $255,718 outstanding convertible note, including accrued interest up to Liquidity Event, into 6,523 common shares. |
Share capital and Contributed S
Share capital and Contributed Surplus | 9 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Sep. 30, 2022 | |
Disclosure of classes of share capital [abstract] | ||
Share capital and Contributed Surplus [Text Block] | 16. Share capital and Contributed Surplus As disclosed in Note 1, the 1-for-70 Reverse Split effected on October 28, 2022 has been applied retrospectively herein. Share capital Authorized KWESST is authorized to issue an unlimited number of common shares. Issued Common Shares Number Issued Price Amount Outstanding at December 2018 3 $ 66.67 $ 200 Issued for directors converted loans (1) 92,857 $ 0.34 31,308 Issued for parent company converted loans (2) 152,857 $ 3.06 467,000 Issued for directors converted loans (3) 21,429 $ 7.00 150,000 Issued for converted debt and accrued interest (4) 44,350 $ 14.00 620,897 Issued in private placement (5) 72,500 $ 14.00 1,014,948 Outstanding at December 31, 2019 383,996 $ 2,284,353 Issued in private placement (6) 37,500 $ 28.00 1,050,000 Issued in private placement (6) 12,082 $ 35.00 422,875 Issued in asset acquisition (7) 9,957 $ 16.80 167,280 Issued for converted debt and accrued interest (8) 6,523 $ 39.20 255,718 Issued for new converted debt and accrued interest (9) 45,858 $ 28.96 1,328,163 Issued in private placement (10) 229 $ 34.93 8,000 Issued for consulting services (11) 871 $ 37.19 32,393 Issued for exercise of stock options (12) 1,743 $ 44.80 78,080 Issued for performance bonus (13) 14,929 $ 49.00 731,500 Issued in brokered private placement (14) 62,994 $ 49.01 3,087,138 Shares from Foremost's QT (15) 12,836 $ 49.00 628,949 Outstanding at September 30, 2020 589,518 $ 10,074,449 Less: share offering costs (699,886 ) Total share capital at September 30, 2020 $ 9,374,563 2019 Activities (1) (2) (3) (4) (5) 2020 Activities (6) (7) (8) (9) (10) (11) (12) (13) (14) (15) Warrants The following reflects the warrant activities for KWESST: # of Exercise Fair Value Weighted Expiry Date Warrants outstanding at December 31 2018 - $ - $ - - Granted 6,500,000 $ 0.20 $ 1,192 3.25 January 1 2024 Granted 2,000,000 $ 0.20 $ 19,858 3.71 June 14 2024 Warrants outstanding at December 31, 2019 8,500,000 $ 1,192 Issued in private placement 15,000 $ 0.40 $ 2,265 1.33 January 30 2022 Issued in private placement 84,622 $ 0.45 $ 13,515 1.60 May 8 2022 Issued in asset acquisition (see Note 4) 750,000 $ 0.50 $ 180,000 2.29 June 12 2022 Issued in private placement 235,428 $ 0.70 $ 60,340 1.77 July 9 2022 Warrants outstanding at September 30, 2020 9,585,050 $ 257,312 3.22 2019 Activities: Warrants were issued to major shareholders, which a portion was subsequently reallocated to the Executive Chairman's controlling company (DEFSEC) and strategic advisor (See Note 10). Management determined that the estimated fair value for 6.5 million warrants issued on January 1, 2019, was insignificant. For the remaining two million warrants, management estimated the fair value for these warrants using the Black-Sholes pricing model with the following inputs: Warrants 1/70 of stock price $ 0.044 Volatility 66.75% Dividend Yield Nil Risk-free interest rate 1.40% Expected life 5 Weighted average fair value per warrant $ 0.0099 2020 Activities: In connection with private placements, warrants were issued as compensation to brokers and consultants. Additionally, KWESST issued 750,000 warrants to SageGuild LLC in connection with the technology acquisition. Management estimated fair value of the warrants using the Black-Scholes pricing model with the following key inputs: Warrants $0.40 Warrants $0.45 Warrants $0.70 1/70 of stock price $ 0.40 $ 0.50 $ 0.70 Volatility 68% 68% 67% Dividend Yield Nil Nil Nil Risk-free interest rate 1.47% 0.27% 0.29% Expected life 2 2 2 Estimated fair value per warrant $ 0.15 $ 0.20 $ 0.26 Stock options KWESST has a rolling stock option plan (the ''Plan'') that authorizes the Board of Directors to grant incentive stock options to directors, officers, consultants and employees, whereby a maximum of 10% of the issued common shares are reserved for issuance under the Plan. Under this Plan, the exercise price of each option may not be less than the market price of KWESST's shares at the date of grant. The maximum term for options is five years. Options are granted periodically and generally vest over two years. The following table shows the status of the Plan: Number of Weighted Options outstanding at December 31, 2019 - $ - Granted 29,357 45.50 Options from the Foremost qualifying transaction 1,224 32.90 Exercised (1,743 ) 35.00 Options outstanding at September 30, 2020 28,838 $ 45.50 Options exercisable at September 30, 2020 7,474 $ 42.00 The following table presents information about stock options outstanding at September 30, 2020: Range of Number Weighted Number $33.00 1,224 2.71 1,224 $35.00 2,614 0.67 - $46.00 13,214 4.41 3,304 $49.00 11,786 4.79 2,946 28,838 4.15 7,474 At September 30, 2020, there were 30,113 stock options available for grant under the Plan. During 2020, KWESST granted 29,357 options (2019 - nil) and recorded stock-based compensation expenses of $283,084 (2019 - $nil) related to the vesting of options. The per share weighted-average fair value of stock options granted in 2020 was $16.10 on the date of grant using the Black-Scholes option model with the following weighted-average assumptions: Stock price $28.00 to $49.00 Exercise price $28.00 to $49.00 Volatility 67.71% Dividend Yield Nil Risk-free interest rate 0.65% Expected life (years) 4.15 Weighted-average fair value per option $ 16.10 Management estimated a forfeiture rate of nil%, except for an option grant of 7,143 at $49.00 each where forfeiture rate was set at 50% based information available subsequent to September 30, 2020. | 15. Share capital and Contributed Surplus As disclosed in Note 1(b), the 1-for-70 Reverse Split effected on October 28, 2022, has been applied retrospectively herein. a) Share capital Authorized KWESST is authorized to issue an unlimited number of common shares. Issued Common Shares September 30, 2022 September 30, 2021 September 30, 2020 Number Amount Number Amount Number Amount Balance, beginning of year 699,511 $ 17,215,068 589,518 $ 9,374,563 383,996 $ 2,284,353 Issued in private placement 22,857 $ 272,000 10,714 $ 1,110,000 49,811 $ 1,480,875 Issued for exercise of warrants 19,000 $ 277,098 10,380 $ 815,307 - $ - Issued for bonus shares relating to borrowings (Note 10) 18,525 $ 411,692 - $ - - $ - Issued for conversion of share units 8,349 $ 874,840 138 $ 12,498 - $ - Issued for acquisition (Note 4(a)) 3,965 $ 377,503 - $ - - $ - Issued for conversion of contingent shares (Note 4(a)) 875 $ 83,319 - $ - - $ - Issued for debt settlements 143 $ 19,000 1,305 $ 63,866 - $ - Issued in brokered private placement - $ - 51,087 $ 3,611,818 62,994 $ 3,087,138 Issued for exercise of stock options - $ - 18,195 $ 1,292,015 1,743 $ 78,080 Issued for asset acquisition (Note 4(b)) - $ - 14,286 $ 1,290,000 9,957 $ 167,280 Issued for exercise of broker compensation options - $ - 2,459 $ 347,680 - $ - Issued for amended license (Note 26) - $ - 1,429 $ 137,000 - $ - Issued for conversion of 15% 2020 converted notes - $ - - $ - 45,858 $ 1,328,163 Issued for performance bonus - $ - - $ - 14,929 $ 731,500 Shares from Foremost's QT (Note 4(c)) - $ - - $ - 12,836 $ 628,949 Issued for conversion of 10% 2019 converted notes - $ - - $ - 6,523 $ 255,718 Issued for consulting services - $ - - $ - 871 $ 32,393 Less: share offering costs for the year - $ (33,880 ) - $ (839,679 ) - $ (699,886 ) Balance, end of year 773,225 $ 19,496,640 699,511 $ 17,215,068 589,518 $ 9,374,563 2022 Activities Private Placement On July 14, 2022, we closed a non-brokered private placement, resulting in the issuance of 22,857 units of KWESST ("July 2022 Units"), at a price of $15.05 per July 2022 Unit (the "Issue Price"), for aggregate gross proceeds of $344,000 (the "July 2022 Offering"). Each July 2022 Unit is comprised of one common share and seventy one-half common share purchase warrant (the "July 2022 Warrants"). Accordingly, we issued 800,000 Warrants exercisable at $0.285 each for a period of 24 months from the closing date. Each Warrant converts into 0.01428571 common shares or 70 warrants for one common share. There was no finder fee paid in this private placement. Certain of our directors and officers (the "Insiders") purchased 5,814 Units for a total consideration of $87,500. The issuance of Units to the Insiders constitutes a related party transaction but is exempt from the formal valuation and minority approval requirements of Multilateral Instrument 61-101 - Protection of Minority Security Holders in Special Transactions ("MI 61-101") as KWESST's securities are not listed on any stock exchange identified in Section 5.5(b) of MI 61-101 and neither the fair market value of the units issued to the Insiders, nor the fair market value of the entire private placement, exceeds 25% of our market capitalization. The securities were issued in accordance with applicable prospectus exemptions under Canadian securities laws. Police Ordnance Acquisition As disclosed in Note 4(a), we issued 3,965 common shares to the selling shareholders in December 2021 at the closing of the acquisition and an additional 875 common shares in April 2022 following the achievement of the financial milestone as defined in the share purchase agreement. 2021 Activities Brokered Private Placement In April 2021, we closed our over-subscribed brokered private placement, resulting in the issuance of 51,087 units ("Units") of KWESST, at a price of $87.50 per Unit (the "Issue Price"), for aggregate gross proceeds of $4,470,071 (the "April 2021 Offering"), as amended in August 2021. Under the April 2021 Offering, we sold a total of 51,087 units at a price of $87.50 per Unit. Each Unit is comprised of one common share of the Company and seventy common share purchase warrants ("April 2021 Warrant"). Each April 2021 Warrant is exercisable to acquire 1/70 of a common share at a price of $1.75 each (70 warrants for one common share) for a period of 24 months from the closing of the April 2021 Offering ("Closing Date"). If at any time after four (4) months and one (1) day following the Closing Date, the trading price of KWESST common stock on the TSX Venture Exchange is equal to or exceeds $210.00 for a period of 10 consecutive trading days, as evidenced by the price at the close of market, we will be entitled to notify the holders of the April 2021 Warrants of its intention to force the exercise of the April 2021 Warrants. Upon receipt of such notice, the holders of April 2021 Warrants shall have 30 days to exercise the April 2021 Warrants, failing which the April 2021 Warrants will automatically expire. Our directors and officers purchased 1,029 Units for a total consideration of $90,000. In connection with this Offering, management has concluded the Unit qualified as an equity instrument under IAS 32, Financial Instruments: Presentation The total cash and non-cash share offering costs were $630,680 for the Offering, including cash commission of $288,405 paid to the Agents and $233,057 of Compensation Options granted to the Agents (see part (c) Contributed Surplus). Asset Acquisition In April 2021, following the closing of the brokered private placement, KWESST closed on the acquisition of the PARA OPS TM Private Placement In September 2021, we closed a non-brokered private placement, resulting in the issuance of 10,714 units ("September Units") of KWESST, at a price of $140.00 per September Unit (the "Issue Price"), for aggregate gross proceeds of $1,500,000 (the "September 2021 Offering"). Under the September 2021 Offering, each September Unit is comprised of one common share and seventy Warrant Shares at a price of $2.35 for each 1/70 of a common share (70 warrants for one common share) for a period of 24 months from September 16, 2021 ("September 2021 Warrants"). If at any time after four months and one day following September 16, 2021, the trading price of KWESST common stock on the TSX-V is equal to or exceeds $322.00 for a period of 3 consecutive trading days, as evidenced by the price at the close of market, we will be entitled to notify the holders of Warrants of its intention to force the exercise of the Warrants. Upon receipt of such notice, the holders of Warrants shall have 30 days to exercise the Warrants, failing which the Warrants will automatically expire. We paid cash commissions to Haywood Securities Inc. in the amount of $90,000 and granted 45,000 broker warrants ("September 2021 Broker Warrants"). Each September 2021 Broker Warrant is exercisable to acquire 1/70 of a common share at a price of $2.00 for a period of 24 months from the closing of the September 2021 Offering. Management estimated a fair value of $0.72 per warrant, using the Black-Scholes option model (see below - Warrants). In connection with this private placement, management has concluded the September Unit qualified as an equity instrument under IAS 32, Financial Instruments: Presentation The total cash and non-cash share offering costs were $130,730 for this private placement. Amended License In April 2021, we issued 1,429 common shares for the exclusivity with AerialX as disclosed in Note 26. Debt for Equity Settlement During the year ended September 30, 2022, we settled $19,000 of legal fees for 143 common shares. During the year ended September 30, 2021, we settled the following liabilities with our common shares: • $47,000 of legal fees for 816 common shares; and • $16,866 of online advertising services for 346 common shares. 2020 Activities Brokered Private Placements In September 2020, KWESST closed a brokered private placement led by PI Financial Corp., resulting in the issuance of 62,994, at $49.01 each, for aggregate gross proceeds of $3,086,687. The total share offering costs were $325,887, settled in cash and warrants. 2020 Convertible Notes In May 2020, KWESST Inc. closed on approximately $1.1 million gross proceeds from the issuance of unsecured convertible notes ("2020 Notes"), with automatic conversion upon a Liquidity Event including the listing of KWESST on the TSX-V. In connection with these 2020 Notes, the note holders earned interest at a rate of 15% per annum. Additionally, as an inducement, the note holders also received 25% of the principal amount in the form of KWESST common shares based on a stock price of $31.50, resulting in the issuance 8,583 at the QT. In light of KWESST going public in September 2020, resulting in the automatic conversion of these 2020 Notes, management concluded that under IAS 38 the recognition of these 2020 Notes should be accounted for as equity and not debt. At the QT, these 2020 Notes were converted to 35,398 common shares. Because the 2020 Notes were treated as equity instruments, the total accrued interest of $59,112 was not recognized in the profit or loss. This accrued interest was converted to 1,877 common shares at QT. In connection with this private placement, KWESST incurred $58,065 of offering costs settled in cash and warrants. Private Placements In January 2020, KWESST closed a non-brokered private placement, resulting in the issuance of 37,500 common shares of KWESST, at $28.00 each, for aggregate gross proceeds of $1,050,000. In March 2020, KWESST closed a non-brokered private placement, resulting in the issuance of 12,082 common shares of KWESST, at $35.00 each, for aggregate gross proceeds of $422,875. In June 2020, KWESST closed a non-brokered private placement, resulting in the issuance of 229 common shares of KWESST, at $34.93 each, for aggregate gross proceeds of $8,000. Performance Share Bonus During the quarter ended September 30, 2020, KWESST settled performance bonuses in the form of 643 common shares. Additionally, KWESST awarded 7,143 common shares each to two M&A / capital market advisors for successfully assisting KWESST to complete a QT, in accordance with their respective consulting agreement. Shares from Foremost As part of the reverse acquisition, KWESST assumed 12,836 common shares previously issued by Foremost (see Note 4(b)). 2019 Convertible Notes In September 2020, as a result of the completion of the QT (see Note 4 (c)) all the 2019 Convertible Notes and accrued interest were automatically converted to 6,523 common shares of KWESST. Asset Acquisition As disclosed in Note 4(c), KWESST issued 9,957 common shares to acquire the Phantom system technology. b) Warrants The following reflects the warrant activities: September 30, 2022 September 30, 2021 September 30, 2020 Weighted Weighted Weighted Number of average Number of average exercise Number of average exercise warrants exercise price warrants price warrants price Outstanding, beginning of year 13,901,640 $ 0.74 9,585,050 $ 0.24 8,500,000 $ 0.20 Issued 1,000,000 $ 0.57 5,043,165 $ 1.73 1,085,050 $ 0.54 Exercised (1,330,000 ) $ 0.26 (726,575 ) $ 1.05 - $ - Expired (154,484 ) $ 0.56 - $ - - $ - Outstanding, end of year 13,417,156 $ 0.78 13,901,640 $ 0.74 9,585,050 $ 0.24 Exercisable, end of year 12,792,156 $ 0.82 12,901,640 $ 0.75 8,835,050 $ 0.22 As a result of the Reverse Split (see Note 1(b)), the warrant holder must exercise 70 warrants to receive one common share. The following table provides additional information on the total outstanding warrants at September 30, 2022: Number outstanding Fair value (1) Expiry Date Founders' warrants: Exercise price of $0.20 5,520,000 $ 1,013 January 1, 2024 Exercise price of $0.20 1,900,000 $ 18,865 June 14, 2024 GhostStep's warrants: Exercise price of $0.50 250,000 $ 60,000 January 15, 2023 April 2021 equity financing: Exercise price of $1.75 3,274,657 $ 785,918 April 29, 2023 Exercise price of $1.75 40,000 $ 9,600 August 25, 2023 LEC's warrants (see Note 4(b)): Exercise price of $0.70 500,000 $ 425,000 April 29, 2026 September 2021 equity financing: Exercise price of $2.35 750,000 $ 390,000 September 16, 2023 Broker warrants: Exercise price of $1.75 137,499 $ 33,000 April 29, 2023 Exercise price of $2.00 45,000 $ 32,400 September 16, 2023 Acquisition of Police Ordnance (Note 4(a)): Exercise price of $1.72 200,000 $ 132,000 December 15, 2024 July 2022 equity financing Exercise price of $0.285 800,000 $ 72,000 July 14, 2024 13,417,156 $ 1,959,796 (1) The fair value for the warrants issued during the year ended September 30, 2022, was determined by the Black Scholes option pricing model using the following key inputs: Acquisition of POC July 2022 Warrants Exercise Price $ 1.72 $ 0.285 1/70 of stock price $ 1.36 $ 0.215 Volatility 84.7% 90.5% Dividend Yield Nil Nil Risk-free interest rate 1.04% 3.12% Expected life 3 2 Weighted average fair value per warrant $ 0.66 $ 0.09 The fair value for the warrants issued during the year ended September 30, 2021, was determined by the following valuation models and key inputs: Barrier Option Model Black-Scholes Option Model April 2021 September 2021 warrants September 2021 LEC warrants Exercise Price $ 1.75 $ 2.35 $ 2.00 $ 0.70 1/70 of stock price $ 1.01 $ 2.14 $ 2.14 $ 0.40 Volatility 80% 80% 80% 0% Dividend Yield Nil Nil Nil Nil Risk-free interest rate 0.31% 0.26% 0.26% 69.00% Barrier (accelerator on life of warrants) $ 3.00 $ 4.60 N/A N/A Rebate $ 1.25 $ 2.00 N/A N/A Expected life 2 1 1 0.85 Weighted average fair value per warrant $ 0.24 $ 0.52 $ 0.72 $ 0.85 The fair value for the warrants issued during nine months ended September 30, 2020, was determined using the Black-Scholes option model using the following inputs: Warrants Warrants Warrants $0.40 $0.45 $0.70 1/70 of stock price $ 0.40 $ 0.50 $ 0.70 Volatility 68% 68% 67% Dividend Yield Nil Nil Nil Risk-free interest rate 1.47% 0.27% 0.29% Expected life 2 2 2 Estimated fair value per warrant $ 0.15 $ 0.20 $ 0.26 c) Contributed Surplus Contributed surplus consists of issued broker compensation options at fair value, the cumulative amortized fair value of share-based compensation grants since inception, less amounts transferred to share capital for exercises. If outstanding options expire or are forfeited, there is no reversal of contributed surplus. Broker Compensation Options The April 2021 Offering was completed by PI Financial Corp., the lead agent and sole bookrunner (the "Lead Agent"), and other dealers (the "Agents"). As consideration for the services provided by the Agents in connection with the April 2021 Offering, the Agents received: (a) a cash commission of $288,405; and (b) 3,296 compensation options (the "Compensation Options"). Each Compensation Option is exercisable to acquire one unit of KWESST (a "Compensation Option Unit") at a price equal to $87.50 for a period of two years after the closing of the Offering. Each Compensation Option Unit is comprised of one Common Share and seventy Common Share purchase warrants (a "Compensation Option Warrant"). Each Compensation Option Warrant is exercisable to acquire 1/70 of a Common Share (a "Compensation Option Warrant Share") at a price of $1.75 per Compensation Option Warrant Share (70 Compensation Option Warrant for one Compensation Option Warrant Share) for a period of 24 months from the closing of the Offering. Based on the structure of the Compensation Option, management estimated its fair value using the Monte Carlo method. Management estimated a fair value of $77.00 per Compensation Option. The following were key inputs used in the Monte Carlo simulation: estimated life of 2 years, underlying stock price of $90.30, exercise price of Compensation Option of $87.50, exercise price of 70 Compensation Option Warrants of $87.50, estimated volatility of 80%, risk free rate of 0.31%, and discount for lack of marketability of 0%. Accordingly, we recorded $233,057 of Compensation Options in contributed surplus, with an equal offset to share offering costs (a non-cash transaction). During the year ended September 30, 2021, the Agents have exercised 2,459 Compensation Option Units for total gross proceeds of $215,148. At September 30, 2022, the total outstanding Compensation Option Units was 837. Share-based compensation On March 31, 2022, our shareholders approved the amended Company's Long-Term Incentive Plan (the "LTIP") to retain a competitive compensation structure for its directors, executives, employees, consultants, and service providers. The LTIP allows for the issuance of stock options ("Options"), restricted share units ("RSUs"), deferred share units ("DSUs"), share appreciation rights ("SARs"), and performance stock units ("PSUs") - collectively referred as Compensation Securities. Under the LTIP, the aggregate maximum number of common shares available for issuance from treasury at any given time shall not exceed 10% of the outstanding common shares as of the date of Compensation Securities, subject to adjustment or increase of such number pursuant to the terms of the LTIP. Any Options that have been cancelled, repurchased, expired, or exercised will again be available under the LTIP. The maximum number of common shares issuable under the LTIP in respect RSUs, DSUs, SARs, and PSUs (herein referred as "Share Units") shall not exceed 60,382 shares. The LTIP is subject to annual shareholder approval at the Annual General and Special Meeting. (i) At September 30, 2022, there were 19,833 stock options available for grant under our LTIP. The following is summary of changes in outstanding stock options for the respective periods: Weighted Number of average options exercise price Outstanding at December 31, 2019 - $ - Granted 29,357 $ 45.50 Options from the Qualifying Transaction 1,224 $ 32.90 Exercised (1,743 ) $ 35.00 Outstanding at September 30, 2020 28,838 $ 45.50 Granted 52,988 $ 104.30 Exercised (18,194 ) $ 50.40 Cancelled (4,096 ) $ 48.30 Outstanding at September 30, 2021 59,536 $ 95.90 Granted 9,500 $ 69.59 Cancelled (11,928 ) $ 131.76 Outstanding at September 30, 2022 57,108 $ 83.87 Options exercisable at September 30, 2022 43,618 $ 83.90 During the year ended September 30, 2022, we granted 9,500 (2021 – 52,988, 2020 – 29,357) options at a weighted average exercise price of $69.59 (2021 – $104.30, 2020 – $45.50). At September 30, 2022, the weighted average remaining vesting period was 0.88 years (2021 – 1.82 years, 2020 – 0.87). For the options granted during the year ended September 30, 2022, the per share weighted-average fair value of stock options was $38.21 (2021 – $50.40, 2020 – $16.10), using the Black-Scholes option model with the following weighted-average assumptions: 2022 2021 2020 $ 14.70 to $ 49.00 to $ 28.00 to Stock price $ 126.70 $ 159.60 $ 49.00 $ 14.70 to $ 49.00 to $ 28.00 to Exercise price $ 126.70 $ 159.60 $ 49.00 Volatility 90.48% 76.46% 67.71% Dividend yield Nil Nil Nil Risk-free interest rate 2.04% 0.35% 65.00% Expected life (years) 2.91 2.26 3.38 Weighted-average fair value per option $ 38.21 $ 50.40 $ 16.10 The following table summarizes information about stock options outstanding at September 30, 2022: Weighted average Weighted Remaining Weighted Range of remaining average exercisable average exercise Number contractual outstanding contractual exercisable prices outstanding life strike price Exercisable life strike price $14.70 to $41.16 4,592 4.54 $ 15.91 306 0.71 $ 32.90 $41.17 to $67.63 12,329 2.74 $ 48.74 12,329 2.74 $ 48.74 $67.64 to $94.10 20,973 3.47 $ 78.02 17,080 3.38 $ 75.79 $94.11 to 120.57 7,448 3.34 $ 118.59 7,448 3.34 $ 118.59 $120.58 to $147.00 11,766 3.95 $ 135.66 6,455 3.97 $ 134.87 57,108 3.48 $ 83.87 43,618 3.26 $ 83.90 Amendment to stock option grants For the year ended September 30, 2022, we had no amended stock option grants. During the year ended September 30, 2021, our Board of Directors approved the acceleration of vesting for 5,507 options and the cancellation of 3,571 options. This contributed an additional stock-based compensation charge of $65,813 (included in the above total share-based compensation expenses). (ii) At September 30, 2022, there were 27,503 Share Units available for grant under our LTIP. The following table shows the changes in Share Units: RSUs PSUs SARs Total Outstanding at September 30, 2020 - - - - Granted 16,412 2,857 2,143 21,412 Vested and converted (139 ) - - (139 ) Outstanding at September 30, 2021 16,273 2,857 2,143 21,273 Granted 10,726 17,942 514 28,668 Vested and converted to common shares (5,681 ) (2,666 ) - (8,347 ) Vested and repurchased for withholding taxes (144 ) (249 ) - (393 ) Expired / cancelled - (17,714 ) - (17,714 ) Outstanding at September 30, 2022 21,174 170 2,657 24,001 RSUs: Each RSU entitles the holder to receive one common share in the future, based on continued service during the applicable period. During the year ended September 30, 2022, we granted 10,726 RSUs (2021 - 16,412), with a weighted-average grant date fair value of $43.50 per unit (2021 - $105.70). The weighted average vesting period for the outstanding RSUs was 0.18 years at September 30, 2022 (2021 - 0.69 years). PSUs: Each PSU entitles the holder to receive one common share in the future, based on the achievement of established performance criteria and continued service during the applicable performance period. During the year ended September 30, 2022, we granted 17,942 PSUs (2021 - 2,857), with a weighted-average grant date fair value of $126.70 per unit (2021 - $105.00). The outstanding PSUs were fully vested at September 30, 2022 (2021 - Weighted average vesting period was 0.40 years). SARs: Each SAR entitles the holder to receive cash or common share at our discretion in the future, based on continued service during the applicable period. The amount of the cash payment or the value of common shares is determined based on the increase of the share price of KWESST between the grant date and the exercise date. Because we intend to always settle in common shares, we account for SARs as equity-settled awards. During the year ended September 30, 2022, we granted 514 SARs (2021 - 2,143) at an exercise price of $126.70 (2021 - $115.50 each). The 514 SARs will expire on May 31, 2023 and 2,143 SARs will expire on January 22, 2024. (iii) For the year ended September 30, 2022, we recorded share-based compensation of $1,960,072 (2021 - $2,462,207, 2020 - $283,084). The following table presents a breakdown of total share-based compensation expense by function: Year ended Year ended Nine months ended September 30, September 30, September 30, 2022 2021 2020 General and administrative $ 1,104,858 $ 1,425,111 $ 160,267 Selling and marketing 552,627 754,167 42,700 Research and development, net 302,587 282,929 80,117 Total share-based compensation $ 1,960,072 $ 2,462,207 $ 283,084 |
Earnings (loss) per share
Earnings (loss) per share | 9 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Sep. 30, 2022 | |
Earnings per share [abstract] | ||
Earnings (loss) per share [Text Block] | 17. Earnings (loss) per share As disclosed in Note 1, the 1-for-70 Reverse Split effected on October 28, 2022 has been applied retrospectively herein. The following table summarizes the calculation of the weighted average basic number of basic and diluted common shares: Nine months Twelve Issued common shares, beginning of period 383,996 3 Effect of shares issued from: Conversion of directors converted loans - 101,174 Conversion of parent company converted loans - 126,055 Exercise of options 447 - Conversion of convertible notes, including interest 7,126 21,769 Issuance for services 1,373 - Issuance for technology acquisition (Note 4 (b)) 1,272 - Issuance of for equity private placements 45,665 - Qualifying transaction (Note 4(a)) 752 - Weighted average number of basic common shares 440,631 249,001 Dilutive securities: Stock options - - Warrants - - Weighted average number of dilutive common shares 440,631 249,001 At September 30, 2020 and December 31, 2019, all the stock options and warrants were anti-dilutive because of KWESST's net loss for both periods. | 16. Earnings (loss) per share The following table summarizes the calculation of the weighted average basic number of basic and diluted common shares: Year ended Year ended Nine months ended September 30, September 30, September 30, 2022 2021 2020 Issued common shares, beginning of year 699,511 589,518 383,996 Effect of shares issued from: Exercise of warrants 10,593 4,383 - Issuance of bonus shares (Note 10) 8,262 - - Private placements 4,571 21,810 45,665 Conversion of stock units 3,703 31 - Acquisition of Police Ordnance (Note 4(a)) 3,144 - - Conversion of contingent shares (Note 4(a)) 386 - - Debt settlements 132 1,038 - Exercise of options - 9,118 447 Asset acquisitions (Note 4(b)) - 6,027 1,272 Amended license agreement (Note 26) - 626 - Exercise of broker options - 170 - Conversion of convertible notes, including interest - - 7,126 Services rendered - - 1,373 Foremost's QT - - 752 Weighted average number of basic common shares 730,302 632,721 440,631 Dilutive securities: Stock options - - - Warrants - - - Weighted average number of dilutive common shares 730,302 632,721 440,631 At September 30, 2022 and 2021, all the stock options and warrants were anti-dilutive because of we incurred net loss for both fiscal years. |
Revenue
Revenue | 9 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Sep. 30, 2022 | |
Revenue [abstract] | ||
Revenue [Text Block] | 18. Revenue The following table presents the key streams of revenue for KWESST: Nine months Twelve months Systems $ 835,097 $ 472,749 Other 26,820 36,399 $ 861,917 $ 509,148 Revenue allocated to remaining performance obligations represents contracted revenue that has not yet been recognized ("contracted not yet recognized") and includes unearned revenue and amounts that will be invoiced and recognized as revenue in future periods. At September 30, 2020, KWESST's contracted not yet recognized revenue was $233,193, of which 100% of this amount is expected to be recognized over the next 12 months. | 17. Revenue a) KWESST generates revenue from the sale of products to its customers. b) In the following table, revenue from contacts with customers is disaggregated by primary geographical market, major products and service lines, and timing of revenue recognition. Nine months Year ended Year ended ended September 30, September 30, September 30, 2022 2021 2020 Major products / service lines Digitization $ 354,620 $ 1,255,982 $ 835,097 Non-Lethal 330,658 - - Training and services 34,590 - - Other 1,651 19,822 26,820 $ 721,519 $ 1,275,804 $ 861,917 Primary geographical markets United States $ 389,210 $ 1,238,063 $ 835,097 Canada 332,309 37,741 26,820 $ 721,519 $ 1,275,804 $ 861,917 Timing of revenue recognition Products and services transferred over time $ 389,210 $ 1,238,063 $ 835,097 Products transferred at a point in time 332,309 37,741 26,820 $ 721,519 $ 1,275,804 $ 861,917 Revenue allocated to remaining performance obligations represents contracted revenue that has not yet been recognized ("contracted not yet recognized") and includes unearned revenue and amounts that will be invoiced and recognized as revenue in future periods. At September 30, 2022, our contracted not yet recognized revenue was $625,177 (2021 - $16,545, 2020 - $233,193), of which 43% of this amount is expected to be recognized over the next 12 months with the remaining 57% expected to be recognized in 2 to 3 years. For the year ended September 30, 2022, one customer accounted for the 41% revenue (2021 - one customer accounted for 95%, 2020 - two customers accounted for 61% and 35%, respectively). |
Expenses by nature
Expenses by nature | 12 Months Ended |
Sep. 30, 2022 | |
Expenses by nature [abstract] | |
Expenses by nature [Text Block] | 18. Expenses by nature The following table presents a breakdown of expenses by nature for the following periods: Year ended Year ended Nine months September 30, September 30, ended 2022 2021 September 30, Employee benefits $ 4,883,062 $ 4,746,316 $ 1,161,071 Advertising and promotion 1,352,750 1,914,630 220,946 Consulting fees 1,315,917 1,138,782 620,295 Professional fees 1,028,240 778,337 190,398 Travel and conferences 518,140 246,418 112,360 R&D consulting and material costs, net 420,378 482,348 100,483 Depreciation and amortization 326,491 140,990 103,397 Other expenses 266,822 252,961 106,006 Insurance 236,150 154,931 - Transfer agent and listing fees 94,885 110,769 - Royalty and license costs - 287,000 - M&A costs - - 1,561,860 Total expenses 10,442,835 10,253,482 4,176,816 Allocation to cost of sales: Employee benefits (166,706 ) (574,018 ) (71,105 ) Total operating expenses $ 10,276,129 $ 9,679,464 $ 4,105,711 |
Depreciation and Amortization
Depreciation and Amortization | 12 Months Ended |
Sep. 30, 2022 | |
Disclosure of attribution of expenses by nature to their function [abstract] | |
Depreciation and Amortization [Text Block] | 19. Depreciation and Amortization The following table presents total depreciation and amortization expense of property and equipment, intangible assets, and right-of-use assets by function: 2022 2021 2020 General and administrative $ 123,960 $ 95,310 $ 89,307 Selling and marketing 129,265 16,443 - Research and development 73,266 29,237 14,090 Total depreciation and amortization $ 326,491 $ 140,990 $ 103,397 |
Net finance costs
Net finance costs | 12 Months Ended |
Sep. 30, 2022 | |
Disclosure Of Net Finance Cost [Abstract] | |
Net finance costs [Text Block] | 20. Net finance costs The following table presents a breakdown of net finance costs for the following periods: Year ended Year ended Nine months ended September 30, September 30, September 30, 2022 2021 2020 Interest expense from: Unsecured loan $ 321,313 $ 4,527 $ - Accretion cost - accrued royalties liability 159,451 64,537 - Lease obligations 30,112 33,872 31,242 Related party loans - 4,581 8,448 CEBA term loan - 4,481 - 2019 convertible notes - - 44,899 Other 1,114 4,115 5,885 Total interest expense 511,990 116,113 90,474 Interest income (5,988 ) (4,848 ) (2,454 ) Gain on termination of lease obligations - - (17,527 ) Gain on government grant - (3,514 ) (9,096 ) Net finance costs $ 506,002 $ 107,751 $ 61,397 |
Income taxes
Income taxes | 9 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Sep. 30, 2022 | |
Major components of tax expense (income) [abstract] | ||
Income taxes [Text Block] | 19. Income tax recovery a) KWESST's effective income tax rate differs from the statutory rate of 26.5% that would be obtained by applying the combined Canadian basic federal and provincial income tax rate to loss before income taxes. These differences result from the following: Nine months Twelve months (Adjusted - see Note 8) (Restated - see Loss before income taxes $ (3,536,778 ) (1,147,280 ) Expected statutory tax rate 26.5% 26.5% Expected tax recovery resulting from loss (937,246 ) (304,029 ) Increase (reduction) in income taxes resulting from: Non-deductible expenses 275,273 28,115 Unrecognized temporary differences 661,973 275,914 $ - $ - KWESST claims research and development deductions and related Investment Tax Credits ("ITC") for tax purposes based on management's interpretation of the applicable legislation in the Income Tax Act of Canada. These claims are subject to audit by the Canada Revenue Agency ("CRA") and any adjustments that results could affect ITCs recorded in the consolidated financial statements. During the nine months ended September 30, 2020, KWESST recognized estimated investment tax credits of $127,325 for the current period and the twelve months ended December 31, 2019. This was presented as a reduction to R&D consulting and material costs in the consolidated statements of net loss and comprehensive loss. b) The following tables deferred tax assets (liabilities) have been recognized in the consolidated financial statements: Balance at Recognized in Recognized in Balance at Deferred tax assets (liabilities): Net operating loss carryforwards $ - $ 48,045 $ - $ 48,045 Intangible assets - (48,045 ) (48,045 ) $ - $ - $ - $ - c) Deferred taxes reflect the impact of loss carryforwards and of temporary differences between amounts of assets and liabilities for financial reporting purposes and such amounts as measured by enacted tax laws. However, KWESST has not recorded net deferred tax assets at September 30, 2020 and December 31, 2019, due to the uncertainty involved in determining whether these deferred tax assets will be realized upon expiration due to KWESST's limited history and operating losses since its inception. The following is a summary of KWESST's unrecognized deductible temporary differences: Balance at Balance at September 30, December 31, 2020 2019 Net operating loss carryforwards $ 4,279,494 $ 2,111,531 Share issuance costs 1,496,239 17,281 Scientific research and development expenditures 218,235 170,940 Other 46,891 22,106 $ 6,040,859 $ 2,321,858 d) At September 30, 2020, KWESST has the following net operating losses in Canada available to reduce future year's taxable income which expire as follows: Year of expiry Amount 2036 $ 512,163 2037 611,677 2038 1,174,797 2039 1,829,518 2040 332,641 $ 4,460,796 | 21. Income taxes a) Income tax recovery is made up of the following components: Nine months Year end ended Year ended ended September 30, September 30, September 30, 2022 2021 2020 Current income tax recovery (expense): $ - $ - $ - Deferred income tax (recovery) expense: (49,442 ) - - $ (49,442 ) $ - $ - b) Our effective income tax rate differs from the statutory rate of 26.5% that would be obtained by applying the combined Canadian basic federal and provincial income tax rate to loss before income taxes. These differences result from the following: Nine months Year ended Year ended ended September 30, September 30, September 30, 2022 2021 2020 Loss before income taxes $ (10,569,732 ) $ (9,315,372 ) $ (3,536,778 ) Expected statutory tax rate 26.5% 26.5% 26.5% Expected tax recovery resulting from loss (2,800,979 ) (2,468,574 ) (937,246 ) Increase (reduction) in income taxes resulting from: Non-deductible expenses 563,842 654,956 275,273 Foreign operations subject to different tax rates 5,329 3,593 - Unrecognized temporary differences 2,182,366 1,826,279 661,973 Prior year differences - (16,254 ) - $ (49,442 ) $ - $ - KWESST claims research and development deductions and related Investment Tax Credits ("ITC") for tax purposes based on management's interpretation of the applicable legislation in the Income Tax Act of Canada. These claims are subject to audit by the Canada Revenue Agency ("CRA") and any adjustments that results could affect ITCs recorded in the consolidated financial statements. The following table shows the breakdown of R&D expenses, net of ITCs: Year ended Year ended Year ended September 30, September 30, September 30, 2022 2021 2020 R&D expenses $ 2,064,493 $ 2,369,145 $ 944,909 Less: Investment tax credits - (231,007 ) (127,325 ) R&D expenses, net 2,064,493 2,138,138 817,584 c) The following tables deferred tax assets (liabilities) have been recognized in the consolidated financial statements: Balance at Arising on a Balance at September 30, business Recognized in September 30, 2021 combination profit or loss 2022 Deferred tax assets (liabilities): Net operating loss carryforwards - - 26,459 26,459 Intangibles and development costs - (49,442 ) 22,983 (26,459 ) - (49,442 ) 49,442 - Balance at Balance at September 30, Recognized in Recognized in September 30, 2020 profit or loss Equity 2021 Deferred tax assets (liabilities): Net operating loss carryforwards 48,045 (48,045 ) - - Impairment provision (48,045 ) 48,045 - - - - - - Balance at Balance at December 31, Recognized in Recognized in September 30, 2019 profit or loss Equity 2020 Deferred tax assets (liabilities): Net operating loss carryforwards - 48,045 - 48,045 Impairment provision - (48,045 ) - (48,045 ) - - - - d) Deferred taxes reflect the impact of loss carryforwards and of temporary differences between amounts of assets and liabilities for financial reporting purposes and such amounts as measured by enacted tax laws. However, KWESST has not recorded net deferred tax assets at September 30, 2022 and 2021 on the following deductible temporary differences, due to the uncertainty involved in determining whether these deferred tax assets will be realized upon expiration due to KWESST's limited history and cumulative operating losses since its inception. The following is a summary of KWESST's unrecognized deductible temporary differences: Balance at Balance at Balance at September 30, September 30, September 30, 2022 2021 2020 Net operating loss carryforwards 18,589,894 9,429,436 4,279,494 Share issuance costs 1,298,783 1,810,927 1,496,239 Intangibles and development costs 608,705 780,607 - Scientific research and development expenditures 1,583,058 1,789,571 218,235 Other 46,300 104,793 46,891 22,126,741 13,915,334 6,040,859 e) At September 30, 2022, KWESST has the following net operating losses in Canada available to reduce future year's taxable income which expire as follows: Year of Expiry Amount 2036 $ 512,163 2037 744,022 2038 1,174,797 2039 1,732,039 2040 and thereafter 14,526,720 $ 18,689,741 f) The Company has the following research and development investment tax credits available to reduce future years' income taxes payable which expire as follows: Year of Expiry Amount 2037 $ 13,361 2038 6,742 2039 - 2040 and thereafter 328,480 $ 348,583 |
Financial instruments
Financial instruments | 9 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Sep. 30, 2022 | |
Disclosure of detailed information about financial instruments [abstract] | ||
Financial instruments [Text Block] | 20. Financial instruments Fair value of financial instruments The fair values of KWESST's cash, trade and other receivables, accounts payables and accrued liabilities, lease deposits (included in non-current other assets), related parties, and convertible notes approximate carrying value because of the short-term nature of these instruments. The lease deposits, convertible notes, and lease obligations were recorded at fair value at initial recognition. Subsequently, these were measured at amortized cost and accreted to their nominal value over their respective terms. Financial derivative liabilities are the only instruments classified as a Level 2 in the fair value hierarchy, as a result of measuring its fair value at each reporting date using the Black-Scholes pricing model. Under IFRS, the levels of fair value hierarchy is as follows: Level 1: Unadjusted quoted prices in active markets for identical assets or liabilities; Level 2: Inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices); and Level 3: inputs for the asset or liability that are not observable market data (unobservable inputs). Financial risk management The Company is exposed to a number of financial risks arising through the normal course of business as well as through its financial instruments. The Company's overall business strategies, tolerance of risk and general risk management philosophy are determined by the directors in accordance with prevailing economic and operating conditions. (a) Interest rate risk Interest rate risk is the risk that the fair value of cash flows of a financial instrument will fluctuate because of changes in market interest rates. KWESST's related party loans have fixed interest rate terms and therefore KWESST is not exposed to interest rate risk. (b) Foreign currency risk Foreign currency risk is the risk that the future cash flows or fair value of the Company's financial instruments that are denominated in a currency that is not KWESST's functional currency will fluctuate due to a change in foreign exchange rates. For the nine months ended September 30 2020, KWESST's revenue was substantially denominated in US dollar driven by contracts with U.S. prime contractors in the defense sector. Accordingly, KWESST is exposed to the US dollar currency. A significant change in the US dollar currency could have a significant effect on KWESST's financial performance, financial position and cash flows. Currently, KWESST does not use derivative instruments to hedge its US dollar exposure. At September 30, 2020, KWESST had the following net US dollar exposure: Total USD Assets $ 222,262 Liabilities (88,019 ) Net exposure at September 30, 2020 $ 134,243 Impact to profit or loss if 5% movement in the US dollar $ 6,712 During the nine months ended September 30, 2020, KWESST recorded foreign exchange loss of $13,937 (12 months in 2019: $982 loss) (c) Credit risk Credit risk is the risk of financial loss to the Company if a counterparty to a financial instrument fails to meet its contractual obligations. KWESST's credit risk exposure is limited to cash, and trade and other receivables. Refer to Note 5 for the breakdown of KWESST's trade and other receivables. KWESST enters into contracts with large, financially sound US general contractors, which mitigates the credit risk. Since September 30, 2020, KWESST has fully collected from the U.S. customer. The remaining receivable is due from the Canadian Federal and Provincial Government for sales tax recoverable and investment tax credits. (d) Liquidity risk Liquidity risk is the risk that KWESST will be unable to meet its financial obligations as they become due. KWESST's objective is to ensure that it has sufficient cash to meet its near term obligation when they become due, under both normal and stressed condition, without incurring unacceptable losses or risking reputational damage to KWESST. A key risk in managing liquidity is the degree of uncertainty in KWESST's cash flows due to its early stage in operations and the need for additional capital to fund its business strategies (see Note 2(a)). At September 30, 2020, KWESST had approximately $3.1 million cash and $2.9 million in working capital (current assets less current liabilities). | 22. Financial instruments Fair value of financial instruments The fair values of our cash, restricted short-term investment, trade and other receivables, accounts payable and accrued liabilities, deposit (included in non-current other assets), and related party loans approximate carrying value because of the short-term nature of these instruments. Under IFRS, the levels of fair value hierarchy is as follows: Level 1: Unadjusted quoted prices in active markets for identical assets or liabilities; Level 2: Inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices); and Level 3: inputs for the asset or liability that are not observable market data (unobservable inputs). The lease deposit, lease obligations, accrued royalties liability, and borrowings were recorded at fair value at initial recognition. The fair value measurement for these were Level 2. Subsequently, these were measured at amortized cost and accreted to their nominal value over their respective terms. At September 30, 2022, the fair value for accrued royalties liability determined using a discount rate of 24% (2021 - 13.7%) would be $869,219 (2021 - $1,105,756). Using the same market discount rate, the fair value of the borrowings would be $68,750 at September 30, 2022 (2021 - $49,825). Financial risk management We are exposed to a number of financial risks arising through the normal course of business as well as through its financial instruments. Our overall business strategies, tolerance of risk and general risk management philosophy are determined by our Board of Directors in accordance with prevailing economic and operating conditions. (a) Interest rate risk Interest rate risk is the risk that the fair value of cash flows of a financial instrument will fluctuate because of changes in market interest rates. At September 30, 2022, our borrowings were all subject fixed interest rate and therefore these were not subject to interest rate risk. At September 30, 2021, our borrowing was interest free. (b) Foreign currency risk Foreign currency risk is the risk that the future cash flows or fair value of our financial instruments that are denominated in a currency that is not our functional currency will fluctuate due to a change in foreign exchange rates. For the years ended September 30, 2022 and 2021, our revenue was substantially denominated in U.S. dollar driven by contracts with U.S. prime contractors in the defense sector. We also procure certain raw materials denominated in U.S. dollar for product development. Accordingly, we are exposed to the U.S. dollar currency. Where a natural hedge cannot be achieved, a significant change in the U.S. dollar currency could have a significant effect on our financial performance, financial position and cash flows. Currently, we do not use derivative instruments to hedge its U.S. dollar exposure. At September 30, 2022, we had the following net U.S. dollar exposure: Total USD Net liabilities in U.S. subsidiary $ 34,623 US denominated: Assets $ 70,187 Liabilities (1,015,090 ) Net U.S. dollar exposure $ (979,526 ) Impact to profit or loss if 5% movement in the U.S. $ (48,976 ) During the year ended September 30, 2022, we recorded foreign exchange gain of $28,780 (2021 - foreign exchange loss of $3,742; 2020 - foreign exchange loss of $13,937). (c) Credit risk Credit risk is the risk of financial loss to KWESST if a counterparty to a financial instrument fails to meet its contractual obligations. Our credit risk exposure is limited to cash, and trade and other receivables. Refer to Note 5 for the breakdown of our trade and other receivables. We enter into contracts with either large, financially sound global general contractors or law enforcement agencies, which mitigates the credit risk. At September 30, 2022, our trade receivable was $114,877 (2021 - $nil), of which $53,233 was overdue by more than 60 days from law enforcement agencies. (d) Liquidity risk Liquidity risk is the risk that we will be unable to meet our financial obligations as they become due. Our objective is to ensure that we have sufficient cash to meet our near-term obligation when they become due, under both normal and stressed condition, without incurring unacceptable losses or risking reputational damage to KWESST. A key risk in managing liquidity is the degree of uncertainty in our cash flows due to our early stage in operations and the need for additional capital to fund our business strategies (see Note 2(a)). At September 30, 2022, our contractual obligations were as follows: Payment due: Total Within 1 Year 1 to 3 years 3 to 5 years Accounts payable and accrued liabilities $ 4,459,481 $ 4,459,481 $ - $ - Borrowings 2,648,280 2,548,280 100,000 - Minimum royalty commitments 2,500,000 150,000 350,000 2,000,000 Lease obligations 327,600 93,600 187,200 46,800 Total contractual obligations $ 9,935,361 $ 7,251,361 $ 637,200 $ 2,046,800 At September 30, 2022, we had $170,545 in cash and $5,409,487 in negative working capital (current assets less current liabilities). See Note 27 (a), Subsequent Events - U.S. IPO and Canadian Offering |
Supplemental cash flow informat
Supplemental cash flow information | 9 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Sep. 30, 2022 | |
Supplemental Cash Flow Information [Abstract] | ||
Supplemental cash flow information [Text Block] | 21. Supplemental cash flow information The following table presents changes in non-cash working capital: Nine months ended 2020 Twelve months ended (As restated - see Note 25) Trade and other receivables $ (257,588 ) $ (41,465 ) Prepaid expenses and other (387,762 ) (36,629 ) Other assets - (150,000 ) Accounts payable and accrued liabilities 393,202 86,519 Deferred revenue 7,053 - $ (245,095 ) $ (141,575 ) The following is a summary of non-cash items that were excluded from the consolidated statements of cash flows for the nine months ended September 30, 2020: $358,178 of right-of-use asset and lease obligations relating to the new office lease; $139,787 of right-of-use asset and $157,315 lease obligations de-recognized from KWESST's consolidated financial position relating to the former lease office; $347,280 of KWESST's common shares and warrants for the asset acquisition of GhostStep® Technology; $255,718 of convertible notes, including accrued interest, settled in KWESST's common shares; $322,779 of share offering costs settled in KWESST's common shares; $41,155 of options adjustment due to QT (see note 4(a)); and $17,531 fair value of options exercised and transferred to KWESST's common shares. The following is a summary of non-cash items that were excluded from the consolidated statements of cash flows for the twelve months ended December 31, 2019: $1,290,255 common shares and warrants for loans. | 23. Supplemental cash flow information The following table presents changes in non-cash working capital: Year ended Year ended Nine months ended September 30, September 30, September 30, 2022 2021 2020 Trade and other receivables $ 631,801 $ (218,334 ) $ (257,588 ) Inventories 49,446 17,555 - Prepaid expenses and other 425,876 (106,205 ) (387,762 ) Accounts payable and accrued liabilities 2,515,289 (828,698 ) 393,202 Contract liabilities 17,410 (7,053 ) 7,053 Deposits - 150,000 - Accrued royalties liability - 1,191,219 - $ 3,639,822 $ 198,484 $ (245,095 ) The following is a summary of non-cash items that were excluded from the consolidated statements of cash flows for the nine months ended September 30, 2022: • $83,319 fair value of 875 contingent shares settled via common shares (see Note 4(a)); • $19,000 debt settlement via common shares; • $61,173 fair value of warrants exercised and transferred to share capital from warrants; and • $125,000 for 250,000 warrants exercised in connection with the GhostStep TM The following is a summary of non-cash items that were excluded from the consolidated statements of cash flows for the year ended September 30, 2021: • $63,866 debt settlement via common shares; • $125,000 for 250,000 exercised warrants in connection with the GhostStep TM • $102,991 fair value of warrants exercised and transferred to share capital; • $203,516 fair value of options exercised and transferred to share capital from contributed surplus; • $1,715,000 fair value of common shares and warrants issued for the acquisition of the LEC System (Note 4(b)), • $137,000 fair value of common shares issued for the amended and restated license agreement with AerialX (Note 26); • $169,832 share offering costs relating to the Broker Compensation Options (Note 15(a)); and • $3,828 non-cash consideration for computer equipment acquired. The following is a summary of non-cash items that were excluded from the consolidated statements of cash flows for the nine months ended September 30, 2020: • $358,178 of right-of-use asset and lease obligations relating to the new office lease; • $139,787 of right-of-use asset and $157,315 lease obligations de-recognized from KWESST's consolidated financial position relating to the former lease office; • $347,280 of KWESST's common shares and warrants for the asset acquisition of GhostStep TM • $255,718 of convertible notes, including accrued interest, settled in KWESST's common shares; • $322,779 of share offering costs settled in KWESST's common shares; • $41,155 of options adjustment due to QT (see note 4(c)); and • $17,531 fair value of options exercised and transferred to KWESST's common shares. |
Segmented information
Segmented information | 9 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Sep. 30, 2022 | |
Disclosure of operating segments [abstract] | ||
Segmented information [Text Block] | 22. Segmented information KWESST's Executive Chairman has been identified as the chief operating decision maker. The Executive Chairman evaluates the performance of the Company and allocates resources based on the information provided by KWESST's internal management system at a consolidated level. KWESST has determined that it has only one operating segment. Geographic information The following table presents external revenue on a geographic basis: Nine months Twelve months United States $ 835,097 $ 472,749 Canada 26,820 36,399 $ 861,917 $ 509,148 All of KWESST's property and equipment are located in Canada, including the right-of-use assets. Concentration of customers information For the nine months ended September 30, 2020, two customers accounted for the revenue based in the United States. For the twelve months ended December ended December 31, 2019, one customer accounted for the revenues based in United States. | 24. Segmented information Our Executive Chairman has been identified as the chief operating decision maker. Our Executive Chairman evaluates the performance of KWESST and allocates resources based on the information provided by our internal management system at a consolidated level. We have determined that we have only one operating segment. At September 30, 2022 and 2021, all of our property and equipment are located in Canada, including the right-of-use assets. |
Capital management
Capital management | 9 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Sep. 30, 2022 | |
Disclosure Of Capital Management [Abstract] | ||
Capital management [Text Block] | 23. Capital management KWESST's objective in managing its capital is to safeguard its ability to continue as a going concern and to sustain future development of the business. The Company's senior management is responsible for managing the capital through regular review of financial information to ensure sufficient resources are available to meet operating requirements and investments to support its growth strategy. The Board of Directors is responsible for overseeing this process. From time to time, KWESST could issue new common shares or debt to maintain or adjust its capital structure. KWESST is not subject to any externally imposed capital requirements. KWESST's capital is composed of the following: September 30, December 31, (Adjusted - See Note 8) Debt: Related party loans $ 218,276 $ 289,828 Borrowings 32,273 - Lease obligations 352,037 202,686 Convertible notes - 210,819 Equity: Share capital 9,374,563 2,284,353 Contributed surplus 583,878 21,050 Accumulated deficit (6,073,577 ) (2,536,799 ) $ 4,487,450 $ 471,937 | 25. Capital management Our objective in managing our capital is to safeguard our ability to continue as a going concern and to sustain future development of the business. Our senior management is responsible for managing the capital through regular review of financial information to ensure sufficient resources are available to meet operating requirements and investments to support our growth strategy. Our Board of Directors is responsible for overseeing this process. From time to time, we could issue new common shares or debt to maintain or adjust our capital structure (see Note 27). KWESST is not subject to any externally imposed capital requirements. KWESST's capital is composed of the following: September 30, September 30, 2022 2021 Debt: Borrowings $ 2,278,774 $ 53,251 Lease obligations 275,621 307,909 Equity: Share capital 19,496,640 17,215,068 Warrants 1,959,796 1,848,389 Contributed surplus 3,551,330 2,458,211 Accumulated other comprehensive loss (101,418 ) (8,991 ) Accumulated deficit (25,909,239 ) (15,388,949 ) Total capital $ 1,551,504 $ 6,484,888 |
Commitments and contingencies
Commitments and contingencies | 9 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Sep. 30, 2022 | |
Disclosure Of Commitments And Contingencies [Abstract] | ||
Commitments and contingencies [Text Block] | 24. Commitments and contingencies a) Minimum royalties On November 18, 2019, KWESST entered into a non-exclusive license agreement with a third party for its product named DroneBullet, a drone whose principal function and operation is acting as a projectile to intercept aerial threats using kinetic force. Under this license agreement, KWESST will pay 8% royalty on annual sales of the DroneBullet to the third party, subject to the following minimum annual payments. $150,000 for March 31, 2020 to December 31, 2020; $200,000 for January 1, 2021 to December 31, 2021; $300,000 for January 1, 2022 to December 31, 2022; $400,000 for January 1, 2023 to December 31, 2023; and $500,000 for January 1, 2024 to December 31, 2024. In accordance with this license agreement, KWESST paid $150,000 advanced royalty to the third party in 2019 (see Note 25). Due to delays in completing a fully functional DroneBullet, the third party delayed its minimum annual royalty payment. In light of this delay, KWESST and the third party are currently renegotiating the contract to amend certain terms, including the timing for the first minimum annual payment. This agreement will expire on March 31, 2025. The agreement was amended subsequent to September 30, 2020 (see Note 26(c)). | 26. Commitments and contingencies AerialX Drone Solutions ("AerialX") On April 5, 2021, we entered into an amended and restated licensing agreement with AerialX to gain exclusive rights to manufacture, operate, and use its drone for the C-UAS (Counter Unmanned Aerial Systems) market, specifically for the United States Department of Defense and Canada's Department of National Defence for a period of two years from the date upon which AerialX will meet certain technical milestones. In consideration for this exclusivity, we have issued 1,429 common shares to AerialX ("Exclusive License Shares"). Based on our closing stock price of $95.90 on April 23, 2021 (TSX-V approval date), the fair value for these shares was $137,000. We recorded the $137,000 fair value as a license cost for the year ended September 30, 2021, with an equal offset to our share capital. In addition to the Exclusive License Shares, we also agreed to issue an additional 1,429 common shares upon AerialX achieving the technical milestones. For the years ended September 30, 2022 and 2021, AerialX has not delivered on the technical milestones and therefore no recognition was made. Additionally, we also agreed to issue up to 4,286 common shares subject to achieving the following performance milestones: # of Common Shares Milestones 1,071 $3 million in sales 1,429 $9 million in sales 1,786 $18 million in sales The amended and restated licensing agreement also changed the terms of the annual minimum royalty payment to AerialX. The initial minimum royalty payment is not due prior to the first anniversary year of the Prototype Date, which is defined under the agreement as the date upon which a functioning prototype is received by us. Under this agreement, we will pay a royalty ranging from 8% to 15% of sales of AerialX technology, subject to the following minimum payments: • 1 st • 2 nd • 3 rd • 4 th • 5 th In accordance with the original agreement dated November 18, 2019, in the first quarter of Fiscal 2020 we made a payment of $150,000 as an advance for future royalty payments (the "Advance"). This Advance was recorded as a non-current deposit at December 31, 2019 and September 30, 2020. During the year ended September 30, 2021, management performed a recoverability review of all our financial assets, including this Advance. Management made the recoverability assessment on the Advance based on anticipated future sales of the licensed technology. Due to the lack of delivery of a functional prototype during the year ended September 30, 2021, management concluded the timing and volume of future sales of the licensed drone was too uncertain. Accordingly, we took a charge to net loss for the year ended September 30, 2021. This charge is included in general and administrative expenses in the consolidated statements of net loss and comprehensive loss. As at September 30, 2022, ArielX has not delivered a functional prototype and no further royalties have been paid. Under the amended and restated licensing agreement, we will continue to have non-exclusive worldwide license. This agreement will expire on April 30, 2026. |
Restatement of previously repor
Restatement of previously reported audited financial statements | 9 Months Ended |
Sep. 30, 2020 | |
Restatement Of Previously Reported Audited Financial Statements [Abstract] | |
Restatement of previously reported audited financial statements [Text Block] | 25. Restatement of previously reported audited financial statements Subsequent to the issuance of the previously reported audited financial statements for the year ended December 31, 2019, management discovered an error with the accounting for a $150,000 advanced royalty paid to a third party. This advanced royalty payment was an advance on future royalty payments under the licencing agreement (see Note The following tables summarizes the effects of the adjustments described above. Line item on the consolidated statements of financial position and consolidated statement of changes in shareholders' equity: As at As at December 31, 2019 Adjustment December 31, 2019 (Previously Reported) (As restated) Other assets $ - $ 150,000 $ 150,000 Non-current assets $ 254,594 $ 150,000 $ 404,594 Total assets $ 550,087 $ 150,000 $ 700,087 Deficit $ (2,686,799 ) $ 150,000 $ (2,536,799 ) Total shareholders' equity (deficit) $ (381,396 ) $ 150,000 $ (231,396 ) Total liabilities and shareholders' equity (deficit) $ 550,087 $ 150,000 $ 700,087 Line item on the consolidated statements of net loss and comprehensive loss: Year ended Year ended December 31, Adjustment December 31, 2019 (Previously Reported) (As restated) General and administrative expenses $ 547,990 $ (150,000 ) $ 397,990 Total operating expenses $ 1,588,376 $ (150,000 ) $ 1,438,376 Operating loss $ (1,164,329 ) $ 150,000 $ (1,014,329 ) Loss before income taxes $ (1,297,280 ) $ 150,000 $ (1,147,280 ) Net loss and comprehensive loss $ (1,297,280 ) $ 150,000 $ (1,147,280 ) Net loss per share $ (5.21 ) $ 150,000 $ (4.61 ) Line item on the consolidated statements of cash flows: Twelve months Twelve months December 31, 2019 Adjustment December 31, 2019 (Previously Reported) (As restated) Net loss per share $ (1,297,280 ) $ 150,000 $ (1,147,280 ) Changes in non-cash working capital items $ 8,425 $ (150,000 ) $ (141,575 ) This non-current asset of $150,000 was subsequently written off. |
Subsequent Events
Subsequent Events | 9 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Sep. 30, 2022 | |
Disclosure of non-adjusting events after reporting period [abstract] | ||
Subsequent Events [Text Block] | 26. Subsequent Events As disclosed in Note 1, the 1-for-70 Reverse Split effected on October 28, 2022 has been applied retrospectively herein. a) Borrowings In December 2020, the Canadian Federal Government amended the CEBA Term Loan program to increase the loan amount by $20,000 to $60,000. KWESST has increased its borrowings accordingly. Additionally, effective January 1, 2021, the outstanding balance of the CEBA Term Loan was automatically converted to a 2-year interest free term loan. The CEBA Term Loan may be repaid at any time without notice or the payment of any penalty. If 75% of the CEBA Term Loan is repaid on or before December 31, 2022, the repayment of the remaining 25% shall be forgiven. If on December 31, 2022, KWESST exercises the option for a 3-year term extension, a 5% annual interest will be applied on the any balance remaining during the extension period. b) Technology acquisition On April 29, 2021, KWESST acquired the Low Energy Cartridge technology from DEFSEC, a proprietary non-lethal cartridge-based firing system (herein referred as the "LEC System"). This technology acquisition includes all intellectual property rights for the LEC System. As DEFSEC is a private company owned by KWESST's Executive Chairman, this asset acquisition is a related party transaction. The purchase consideration consisted of: 14,286 common shares of KWESST; and 500,000 warrants to purchase KWESST's common shares at $0.70 per 1/70 of a common share; 25% vesting on the first anniversary of the closing of the LEC Technology acquisition and 25% per annum thereafter. These warrants will expire on April 29, 2026. Additionally, KWESST will pay 7% royalty on annual sales of the LEC System to DEFSEC, net of taxes and duties, up to a maximum of $10 million, subject to minimum annual royalty payments starting in 2023. The royalty payment obligation of the Purchase Agreement ("Agreement") will expire in 20 years unless terminated earlier under the terms set out in the Agreement. c) Amended and restated licensing agreement As disclosed in Note 24(a), KWESST entered into a licensing agreement with a third party, AerialX Drone Solutions ("AerialX"). Subsequently on April 5, 2021, KWESST entered into an amended and restated licensing agreement with AerialX for a period of two years from the date upon which AerialX will meet certain technical milestones. In consideration, KWESST has issued 1,429 common shares to AerialX ("Exclusive License Shares"). Based on KWESST's closing stock price of $95.90 on April 23, 2021 (TSX-V approval date), the fair value for these shares was $137,000. d) Share capital activities In April 2021, KWESST closed a brokered private placement, resulting in the issuance of 51,087 units of KWESST, at a price of $87.50 per unit for aggregate gross proceeds of $4,470,071. Each issued unit is comprised of one common share of the Company and seventy common share purchase warrant. Each Warrant is exercisable to acquire 1/70 of a common share at a price of $1.75 each (70 warrants for one common share) for a period of 24 months from the closing date. If at any time after four (4) months and one (1) day following the closing date, the trading price of KWESST common stock on the TSX Venture Exchange is equal to or exceeds $21.00 for a period of 10 consecutive trading days, as evidenced by the price at the close of market, KWESST shall be entitled to notify the holders of the Warrants of its intention to force the exercise of the Warrants. Upon receipt of such notice, the holders shall have 30 days to exercise the Warrants, failing which the Warrants will automatically expire. The following provides a summary of share capital activities since September 30, 2020: Number Amount Outstanding at September 30, 2020 589,518 $ 9,374,563 Issued in brokered private placement 51,087 $ 3,611,818 Issued for exercise of stock options 18,195 $ 1,292,015 Issued for asset acquisition 14,286 $ 1,290,000 Issued in private placement 10,714 $ 1,110,000 Issued for exercise of warrants 10,380 $ 815,307 Issued for exercise of broker compensation options 2,459 $ 347,680 Issued for amended license 1,429 $ 137,000 Issued for debt settlements 1,305 $ 63,866 Issued for share units 138 $ 12,498 Less: share offering costs for the year - $ (839,679 ) Outstanding at September 30, 2021 699,511 $ 17,215,068 | 27. Subsequent Events a) U.S. IPO and Canadian Offering On December 9, 2022, we closed an underwritten U.S. public offering (the "U.S. IPO") and an underwritten Canadian offering (the "Canadian Offering"). In the U.S. IPO, we sold 2,500,000 units at a public offering price of USD $4.13 per unit (the "Unit"), consisting of one share of common stock and one warrant to purchase one share of common stock ("Warrant"). The Warrants have a per share exercise price of USD $5.00, can be exercised immediately, and expire five years from the date of issuance. In connection with the closing of the U.S. IPO, the underwriter partially exercised its over-allotment option to purchase an additional 199,000 pre-funded common share purchase warrants and 375,000 warrants to purchase common shares. The underwriter has the right to exercise the balance of its over-allotment option within the 45-day period. In the Canadian Offering, we sold 726,392 units, each consisting of one common share and one warrant to purchase one common share, at a price to the public of USD $4.13 per unit. The warrants will have a per common share exercise price of USD $5.00, are exercisable immediately and expire five years from the date of issuance. The closing of the U.S. IPO and Canadian Offering resulted in aggregate gross proceeds of USD $14,145,000, before deducting underwriting discounts and offering expenses. The common shares of KWESST and the Warrants sold in the U.S. IPO began trading on the Nasdaq Capital Market under the symbols "KWE" and "KWESW", respectively, on December 7, 2022. ThinkEquity acted as sole book-running manager for the U.S. IPO and PI Financial acted as sole book-running manager for the Canadian Offering. As consideration for the services provided in connection with the U.S. IPO, ThinkEquity received: (a) a broker-dealer cash commission of approximately US$835,000 equal to 7.5% of the gross offering proceeds of the U.S. Offering and (b) underwriter warrants (the "Underwriter Warrants") to purchase up to 134,950 common shares equal to 5% of the common shares and pre-funded common share purchase warrants issued under the U.S. Offering. Each Underwriter Warrant is exercisable to acquire one common share at a price of US$5.1625, exercisable as of June 4, 2023, and expiring December 4, 2027. As consideration for the services provided in connection with the Canadian Offering, PI Financial received: (a) a cash commission of approximately US$210,000 equal to 7% of the gross proceeds of the Offering; and (b) 50,848 compensation options (the "Compensation Options") equal to 7% of the number of Units issued under the Canadian Offering. Each Compensation Option is exercisable to acquire one Canadian Unit at a price of US$4.13 for a period of two years after the closing of the Canadian Offering. In addition to the above brokers' compensation, we also incurred US$2.3 million share offering costs for the U.S. IPO and Canadian Offering, of which $628,262 was incurred and deferred at September 30, 2022. b) Shares for Debt Settlement We have entered into share for debt arrangements with existing lenders, which closed on December 13, 2022, following TSXV's conditional approval. This resulted in issuing 56,141 Units to settle $12,000 of the March 2022 Loans and USD$223,321 of the August 2022 Loans, including unpaid accrued interest and 10% premium at maturity (the "Debt Settlements") - see Note 12. The terms of the Units are the same as the Units issued in the Canadian Offering (see part (a)). The Units, as well as the common shares and Warrants, to be issued pursuant to the Debt Settlements will be subject to a four-month hold period pursuant to applicable securities regulations and the policies of the TSXV. c) Loan Repayments In December 2022, we have repaid the remaining $1,997,435 of the March 2022 Loans, including accrued unpaid interest, and USD$223,321 of the August 2022 Loans, including unpaid accrued interest and 10% premium at maturity. Following these loan repayments, there were no further outstanding loans. In December 2022, we have repaid the CEBA Term Loans net of the total forgivable amount of $30,000. |
Significant accounting polici_2
Significant accounting policies (Policies) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Sep. 30, 2022 | |
Disclosure Of Significant Accounting Policies [Abstract] | ||
Revenue recognition [Policy Text Block] | (a) Revenue recognition KWESST determines the amount of revenue to be recognized through application of the following five-step process: (i) (ii) (iii) (iv) (v) For contracts with payment milestones, Management estimates the percentage of completion and records unbilled revenue. KWESST also recognizes an asset for the incremental costs of obtaining a contract with a customer if it expects the costs to be recoverable. Management has determined that sales commissions meet the requirements to be capitalized. Capitalized contract acquisition costs are amortized consistent with the pattern of transfer to the customer for the goods and services to which the asset relates. KWESST applies the practical expedient available under IFRS 15 and does not capitalize incremental costs of obtaining contracts if the amortization period is one year or less. | (a) Revenue recognition Revenue is recognized upon transfer of control of products or services to customers at an amount that reflects the transaction price we expect to receive in exchange for the products or services. Our contracts with customers may include the delivery of multiple products and services, which are generally capable of being distinct and accounted for as separate performance obligations. The accounting for a contract or contracts with a customer that contain multiple performance obligations requires us to allocate the contract or contracts transaction price to the identified distinct performance obligations based on the stand-alone selling price of each performance obligation. Revenue from contracts with customers is recognized, for each performance obligation, either over a period of time or at a point in time, depending on which method reflects the transfer of control of the goods or services underlying the particular obligation to the customer. For performance obligations satisfied over time, we recognize revenue over time using an input method, based on costs incurred to date relative to total estimated costs at completion, to measure progress toward satisfying such performance obligation (for non-recurring engineering services, the input method is based on hours). Under this method, costs that do not contribute to the performance of KWESST in transferring control of goods or services to the customer are excluded from the measurement of progress toward satisfying the performance obligation. In certain other situations, we might recognize revenue at a point in time, when the criteria to recognize revenue over time are not met. In any event, when the total anticipated costs exceed the total anticipated revenues on a contract, such loss is recognized in its entirety in the period it becomes known. We may enter into contractual arrangements with a customer to deliver services on one project with respect to more than one performance obligation, such as non-recurring engineering, procurement, and training. When entering into such arrangements, we allocate the transaction price by reference to the stand-alone selling price of each performance obligation. Accordingly, when such arrangements exist on the same project, the value of each performance obligation is based on its stand-alone price and recognized according to the respective revenue recognition methods described above. For example, for non-recurring engineering services rendered over a contract period the revenue is recognized using the percentage of completion method; whereas for training services the revenue is recognized after the training is delivered (i.e. point in time). We account for a contract modification, which consists of a change in the scope or price (or both) of a contract, as a separate contract when the remaining goods or services to be delivered after the modification are distinct from those delivered prior to the modification and the price of the contract increases by an amount of consideration to a price which reflects KWESST's stand-alone selling price of the additional promised goods or services. When the contract modification is not accounted for as a separate contract, we recognize an adjustment to revenue on a cumulative catch-up basis at the date of contract modification. The timing of revenue recognition often differs from performance payment schedules, resulting in revenue that has been earned but not billed. These amounts are included in unbilled receivables. Amounts billed in accordance with customer contracts, but not yet earned, are recorded and presented as part of contract liabilities. When a contract includes a significant financing component, the value of such component is excluded from the transaction price and is recognized separately as finance income or expense, as applicable. |
Business combinations [Policy Text Block] | (b) Business combinations We account for business combinations using the acquisition method. Goodwill arising on acquisitions is measured as the fair value of the consideration transferred less the net recognized amount of the estimated fair value of identifiable assets acquired and liabilities assumed, all measured as of the acquisition date. Transaction costs that we incur in connection with a business combination are expensed as incurred. We use our best estimates and assumptions to reasonably value assets acquired and liabilities assumed at the acquisition date as well as contingent consideration, where applicable, and these estimates are inherently uncertain and subject to refinement. As a result, during the measurement period, which may be up to one year from the acquisition date, we may record adjustments to the assets acquired and liabilities assumed with a corresponding offset to goodwill. Upon 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 in profit or loss. Where the total purchase consideration is less than the fair value of identifiable net assets, we recognize a gain on acquisition. Acquisitions that do not meet the definition of a business are accounted for as asset acquisitions in accordance with the relevant IFRS standards and applicable to the type of asset acquired. | |
Financial instruments [Policy Text Block] | (b) Financial instruments KWESST recognizes a financial asset or a financial liability when it becomes a party to the contractual provisions of the instrument. Trade and other receivables without a significant financing component are initially measured at the transaction price. All other financial assets and financial liabilities are initially recognized at fair value. Transaction costs that are directly attributable to the acquisition or issue of financial assets and financial liabilities (other than financial assets and financial liabilities at fair value through profit or loss (''FVTPL'')) are added to or deducted from the fair value of the financial assets or financial liabilities, as appropriate, on initial recognition. Transaction costs directly attributable to the acquisition of financial assets or financial liabilities at fair value through profit or loss are recognized immediately in profit or loss. Financial assets All financial assets are recognized and de-recognized on trade date. Financial assts are recognized at fair value and subsequently classified and measured at: a) b) c) KWESST determines the classification of its financial assets on the basis of both the business model for managing the financial assets and the contractual cash flows characteristics of the financial asset. Financial assets are not reclassified subsequent to their initial recognition unless the Company changes its business model for managing financial assets. A financial asset is measured at amortized cost if it is held within a business model whose objective is to hold assets to collect contractual cash flows, and its contractual terms give rise on specified dates to cash flows that are solely payments of principal and interest of the principal amount outstanding. At September 30, 2020, KWESST classified the following as amortized cost: Cash Trade and other receivables Lease deposit (non-current other asset) All financial assets not classified and measured at amortized cost or FVOCI are measured at FVTPL. At September 30, 2020, KWESST did not have financial assets classified as FVOCI or FVTPL. Expected credit losses KWESST measures a loss allowance based on the lifetime expected credit losses. Lifetime expected credit losses are estimated based on factors such as KWESST's past experience of collecting payments, the number of delayed payments in the portfolio past the average credit period, observable changes in national or local economic conditions that correlate with default on receivables, financial difficulty of the borrower, and it becoming probable that the borrower will enter bankruptcy or financial re-organization. Financial assets are written off when there is no reasonable expectation of recovery. Financial liabilities Financial liabilities are recognized at fair value and subsequently classified and measured at amortized cost or fair value though profit or loss (''FVTPL''). KWESST determines the classification of its financial liabilities at initial recognition. The Company has classified the following as amortized costs: Accounts payable and accrued liabilities Related party loans Borrowings Lease obligations Convertible notes Financial liabilities at amortized cost are measured using the effective interest rate method. At September 30, 2020 and December 31, 2019, KWESST classified financial derivative liabilities as FVTPL. Accordingly, fair value is remeasured at each reporting period with the fair value adjustment recognized in profit or loss. There was no outstanding financial derivative liability at September 30, 2020. De-recognition of financial liabilities KWESST de-recognizes financial liabilities when its obligations are discharged, cancelled or they expire. | (c) Financial instruments We recognize a financial asset or a financial liability when it becomes a party to the contractual provisions of the instrument. Trade and other receivables without a significant financing component are initially measured at the transaction price. All other financial assets and financial liabilities are initially recognized at fair value. Transaction costs that are directly attributable to the acquisition or issue of financial assets and financial liabilities (other than financial assets and financial liabilities at fair value through profit or loss ("FVTPL")) are added to or deducted from the fair value of the financial assets or financial liabilities, as appropriate, on initial recognition. Transaction costs directly attributable to the acquisition of financial assets or financial liabilities at fair value through profit or loss are recognized immediately in profit or loss. Financial assets All financial assets are recognized and de-recognized on trade date. Financial assets are recognized at fair value and subsequently classified and measured at: a) b) c) We determine the classification of our financial assets on the basis of both the business model for managing the financial assets and the contractual cash flows characteristics of the financial asset. Financial assets are not reclassified subsequent to their initial recognition unless we change our business model for managing financial assets. A financial asset is measured at amortized cost if it is held within a business model whose objective is to hold assets to collect contractual cash flows, and its contractual terms give rise on specified dates to cash flows that are solely payments of principal and interest of the principal amount outstanding. Financial assets classified at amortized cost are measured using the effective interest method. At September 30, 2022, we classified the following as amortized cost: • Cash • Restricted short-term investment • Trade and other receivables • Lease deposit (non-current other asset) All financial assets not classified and measured at amortized cost or FVOCI are measured at FVTPL. At September 30, 2022, we did not have financial assets classified as FVOCI or FVTPL. Expected credit losses We measure a loss allowance based on the lifetime expected credit losses. Lifetime expected credit losses are estimated based on factors such as our past experience of collecting payments, the number of delayed payments in the portfolio past the average credit period, observable changes in national or local economic conditions that correlate with default on receivables, financial difficulty of the borrower, and it becoming probable that the borrower will enter bankruptcy or financial re-organization. Financial assets are written off when there is no reasonable expectation of recovery. Financial liabilities Financial liabilities are recognized at fair value and subsequently classified and measured at amortized cost or fair value though profit or loss ("FVTPL"). We determine the classification of our financial liabilities at initial recognition. We have classified the following as amortized costs: • Accounts payable and accrued liabilities • Corporate tax payable • Borrowings • Lease obligations • Accrued royalties liability Financial liabilities at amortized cost are measured using the effective interest rate method. De-recognition of financial liabilities KWESST de-recognizes financial liabilities when its obligations are discharged, cancelled or they expire. |
Cash and cash equivalents [Policy Text Block] | (d) Cash and cash equivalents Cash and cash equivalents include cash investments in interest-bearing accounts and term deposits which can readily be redeemed for cash without penalty or are issued for terms of three months or less from dated of acquisition. | |
Inventories [Policy Text Block] | (e) Inventories KWESST's inventories may consist of raw materials, work-in-progress ("WIP"), and finished goods. Inventories are measured at the lower of cost and net realizable value, with cost being determined using the weighted average cost method. The cost of WIP and finished goods includes the cost of raw materials, direct labour, and overhead. Net realizable value is the estimated selling price in the ordinary course of business, less the estimated costs of completion and selling expenses. At each reporting period, management estimates the provision for obsolete and slow-moving inventory which may be reversed in subsequent periods, should the value subsequently be recovered. | |
Property and equipment [Policy Text Block] | (c) Property and equipment Property and equipment are measured at cost less accumulated depreciation and accumulated impairment losses. Cost comprises the fair value of consideration given to acquire or construct an asset and includes the direct charges associated with bringing the asset to the location and condition necessary for putting it into use along with the future cost of dismantling and removing the asset. These assets are depreciated over their estimated useful lives using the straight-line method as this most closely reflects the expected pattern of consumption o the future economic benefits. Depreciation methods, useful lives and residual values are reviewed at each financial year end and adjusted prospectively, if appropriate. The following table provides a summary of estimated useful lives for KWESST's property and equipment: Property and equipment Rate Computer equipment 5 years Computer software 3 years Office furniture and equipment 5 years R&D equipment 5 years Leasehold improvements Shorter of useful life or remaining term of lease At the end of each reporting period, KWESST reviews the carrying amounts of its property and equipment to determine whether there is any indication of impairment. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). The recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. For the purpose of impairment testing, assets that cannot be tested individually are grouped together into the smallest group of assets that generates cash inflows from continuing use that are largely independent of the cash flows of other assets or groups of assets (the ''cash-generating unit, or CGU''). If the recoverable amount of an asset is estimated to be less than its carrying amount, the carrying amount of the asset is reduced to its recoverable amount. An impairment loss is recognized immediately in profit or loss. Assets to be disposed of are reported at the lower of the carrying amount or fair value less costs to sell. | (f) Property and equipment Property and equipment are measured at cost less accumulated depreciation and accumulated impairment losses. Cost comprises the fair value of consideration given to acquire or construct an asset and includes the direct charges associated with bringing the asset to the location and condition necessary for putting it into use along with the future cost of dismantling and removing the asset. These assets are depreciated over their estimated useful lives using the straight-line method as this most closely reflects the expected pattern of consumption of the future economic benefits. Depreciation methods, useful lives and residual values are reviewed at each financial year end and adjusted prospectively, if appropriate. The following table provides a summary of estimated useful lives for our property and equipment: Rate Computer equipment 3 years Computer software 3 years Office furniture and equipment 5 years Low-rate initial production equipment 5 years R&D equipment 5 years Sales demo equipment 2 years Leasehold improvements Shorter of useful life or remaining term of lease At the end of each reporting period, we review the carrying amounts of its property and equipment to determine whether there is any indication of impairment. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). The recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. For the purpose of impairment testing, assets that cannot be tested individually are grouped together into the smallest group of assets that generates cash inflows from continuing use that are largely independent of the cash flows of other assets or groups of assets (the "cash-generating unit, or CGU"). If the recoverable amount of an asset is estimated to be less than its carrying amount, the carrying amount of the asset is reduced to its recoverable amount. An impairment loss is recognized immediately in profit or loss. Assets to be disposed of are reported at the lower of the carrying amount or fair value less costs to sell. |
Leases [Policy Text Block] | (d) Leases At inception of a contract, KWESST assesses whether a contract is, or contains, a lease based on whether the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. KWESST recognizes a right-of-use asset and a lease liability at the lease commencement date. The lease obligation is measured at the present value of the remaining lease payments as of January 1, 2018, discounted using its incremental borrowing rate of 10%. The right-of-use asset is initially measured based on the initial amount of the lease liability adjusted for any lease payments made at or before the commencement date, plus any initial direct costs incurred and an estimate of costs to dismantle and remove the underlying asset or to restore the underlying asset or the site on which it is located, less any lease incentives received. The assets are depreciated to the earlier of the end of the useful life of the right-of-use asset or the lease term using the straight-line method as this most closely reflects the expected pattern of consumption of the future economic benefits. The lease term includes periods covered by an option to extend if KWESST is reasonably certain to exercise that option. Lease terms range from 3 to 6 years for offices and printer. In addition, the right-of-use asset is periodically reduced by impairment losses, if any, and adjusted for certain remeasurements of the lease liability. The lease liability is initially measured at the present value of the lease payments that are not paid at the commencement date, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, KWESST's incremental borrowing rate. Variable lease payments that do not depend on an index or rate are not included in the measurement of the lease liability. The lease liability is measured at amortized cost using the effective interest method. It is remeasured when there is a change in future lease payments arising from a change in an index or rate, if there is a change in KWESST's estimate of the amount expected to be payable under a residual value guarantee, or if KWESST changes its assessment of whether it will exercise a purchase, extension, or termination option. When the lease liability is remeasured in this way, a corresponding adjustment is made to the carrying value of the right-of-use asset or, is recorded in profit or loss if the carrying amount of the right-of-use asset has been reduced to zero. KWESST has elected to apply the practical expedient not to recognize right-of-use assets and lease liabilities for short-term leases that have a lease term of 12 months or less and leases of low-value assets. The lease payments associated with these leases are recognized as an expense on a straight-line basis over the lease term. | (g) Leases At inception of a contract, we assess whether a contract is, or contains, a lease based on whether the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. We recognize a right-of-use asset and a lease liability at the lease commencement date. The lease obligation is measured at the present value of the lease payments that are not paid at the commencement date of the lease, discounted using its incremental borrowing rate at the inception of the lease (it was 10% for the current outstanding lease agreement). The right-of-use asset is initially measured based on the initial amount of the lease liability adjusted for any lease payments made at or before the commencement date, plus any initial direct costs incurred and an estimate of costs to dismantle and remove the underlying asset or to restore the underlying asset or the site on which it is located, less any lease incentives received. The assets are depreciated to the earlier of the end of the useful life of the right-of-use asset or the lease term using the straight-line method as this most closely reflects the expected pattern of consumption of the future economic benefits. The lease term includes periods covered by an option to extend if we are reasonably certain to exercise that option. In addition, the right-of-use asset is periodically reduced by impairment losses, if any, and adjusted for certain remeasurements of the lease liability. The lease liability is initially measured at the present value of the lease payments that are not paid at the commencement date, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, our incremental borrowing rate. Variable lease payments that do not depend on an index or rate are not included in the measurement of the lease liability. The lease liability is measured at amortized cost using the effective interest method. It is remeasured when there is a change in future lease payments arising from a change in an index or rate, if there is a change in our estimate of the amount expected to be payable under a residual value guarantee, or if we change our assessment of whether it will exercise a purchase, extension, or termination option. When the lease liability is remeasured in this way, a corresponding adjustment is made to the carrying value of the right-of-use asset or, is recorded in profit or loss if the carrying amount of the right-of-use asset has been reduced to zero. We have elected to apply the practical expedient not to recognize right-of-use assets and lease liabilities for short-term leases that have a lease term of 12 months or less and leases of low-value assets. The lease payments associated with these leases are recognized as an expense on a straight-line basis over the lease term. |
Intangible assets [Policy Text Block] | (e) Intangible assets (i) Expenditure on research activities, undertaken with the prospect of gaining new scientific or technical knowledge and understanding, is recognized in profit or loss when incurred. Development activities involve a plan or design for the production of new or substantially improved products and processes. Development expenditure is capitalized only if development costs can be measured reliably, the product or process is technically and commercially feasible, future economic benefits are probable, and KWESST has the intention and sufficient resources to complete the development and to use or sell the asset. The expenditure capitalized in respect of development activities includes the cost of materials, direct labor and overhead costs that are directly attributable to preparing the asset for its intended use, and capitalized borrowing costs. Other development expenditures are recognized in profit or loss when incurred. (ii) Subsequent expenditure is capitalized only when it increases the future economic benefits embodied in the specific asset to which it relates. All other expenditures, including expenditure on internally generated goodwill and brands, is recognized in profit or loss as incurred. (iii) Amortization is a systematic allocation of the amortizable amount of an intangible asset of its useful life. The amortizable amount is the cost of the asset less its estimated residual value. KWESST recognizes in profit or loss on a sales-based rate over the estimated useful lives of the intangible assets from the date they are available for use, since this method most closely reflect the expected pattern of consumption of the future economic benefits embodied in each asset. Where a sales-based rate could not be determined, the straight-line approach is used. Internally generated intangible assets are not systematically amortized as long as they are not available for use i.e. they are not yet on site or in working condition for their intended use. Accordingly, intangible assets such as development costs are tested for impairment at least once a year, until such date as they are available for use. (iv) All intangible assets are periodically reviewed for impairment. The estimated present value of future cash flows associated with the intangible asset is determined and an impairment loss is recognized for the difference between this amount and the carrying amount as follows: the carrying amount of the asset is reduced to estimated present value of the future cash flows associated with the asset, discounted at the financial asset's original effective interest rate, and the resulting loss is directly recognized in profit or loss for the period. | (h) Intangible assets (i) Expenditure on research activities, undertaken with the prospect of gaining new scientific or technical knowledge and understanding, is recognized in profit or loss when incurred. Development expenditure is capitalized only if development costs can be measured reliably, the product or process is technically and commercially feasible, future economic benefits are probable, and we have the intention and sufficient resources to complete the development and to use or sell the asset. The expenditure capitalized in respect of development activities includes the cost of materials, direct labor and overhead costs that are directly attributable to preparing the asset for its intended use, and capitalized borrowing costs. Other development expenditures are recognized in profit or loss when incurred. (ii) Subsequent expenditure is capitalized only when it increases the future economic benefits embodied in the specific asset to which it relates. All other expenditures, including expenditure on internally generated goodwill and brands, is recognized in profit or loss as incurred. (iii) Acquired intangible assets consist of open customer orders, tradenames, customer relationships, patents, and technology assets acquired either through an asset purchase or a business combination transaction. These intangible assets are recorded at their fair value at the acquisition date. After initial recognition, except for open customer orders, intangible assets are measured at cost less any accumulated amortization and impairment losses. For open customer orders, we reduce the amount when we have delivered under the customer contract, with an offset to accounts receivable (i.e. there is no revenue recognized for acquired open customer orders). Intangible assets with finite useful lives are amortized on a straight-line basis over their estimated useful lives. Amortization begins when the related acquired technology is commercialized. We anticipate the estimated useful life for the current technology assets to be five years once commercialized. (iv) Amortization is a systematic allocation of the amortizable amount of an intangible asset of its useful life. The amortizable amount is the cost of the asset less its estimated residual value. We recognize in profit or loss on a sales-based rate over the estimated useful lives of the intangible assets from the date they are available for use, since this method most closely reflects the expected pattern of consumption of the future economic benefits embodied in each asset. Where a sales-based rate could not be determined, the straight-line approach is used. Internally generated intangible assets are not systematically amortized as long as they are not available for use i.e. they are not yet in working condition for their intended use. Accordingly, intangible assets such as development costs are tested for impairment at least once a year, until such date as they are available for use. (v) All intangible assets are periodically reviewed for impairment. The estimated present value of future cash flows associated with the intangible asset is determined and an impairment loss is recognized for the difference between this amount and the carrying amount as follows: the carrying amount of the asset is reduced to estimated present value of the future cash flows associated with the asset, discounted at the financial asset's original effective interest rate, and the resulting loss is directly recognized in profit or loss for the period. |
Provisions [Policy Text Block] | (f) Provisions A provision is recognized if, as a result of a past event, KWESST has a present legal or constructive obligation that can be estimated reliably, and it is probable that an outflow of economic benefits will be required to settle the obligation. Provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects current market assessments of the time value of money and the risk specific to the liability. The unwinding of the discount is recognized as a finance cost. | (i) Provisions A provision is recognized if, as a result of a past event, we have a present legal or constructive obligation that can be estimated reliably, and it is probable that an outflow of economic benefits will be required to settle the obligation. Provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects current market assessments of the time value of money and the risk specific to the liability. The accretion of the discount is recognized as a finance cost. |
Convertible notes [Policy Text Block] | (g) Convertible notes KWESST's convertible notes are segregated into their debt and equity components or derivative liability components at the date of issue, in accordance with the substance of the contractual agreements. The conversion feature of the convertible notes is presumed to be classified as a derivative financial liability unless it meets all the criteria to recognize as equity instrument under IAS 32, Financial Instruments: Presentation. One of the criteria is that the conversion option exchanges a fixed amount of shares for a fixed amount of cash ("fixed for fixed"). If the conversion feature meets the fixed for fixed criteria, the conversion option will be classified as equity components. Equity instruments are instruments that evidence a residual interest in the assets of an entity after deducting all of its liabilities. Therefore, when the initial carrying amount of the convertible notes is allocated to its equity and liability components, the equity component is assigned the residual amount after deducting from the fair value of the instrument as a whole the amount separately determined for the liability component. The sum of the carrying amounts assigned to the liability and equity components on initial recognition is always equal to the fair value that would be ascribed to the instrument as a whole. No gain or loss arises from initially recognizing the components of the instrument separately. If the conversion feature does not meet the fixed for fixed criteria, the conversion option will be recorded as derivative financial liability, which must be separately accounted for at fair value on initial recognition. The carrying amount of the debt component, on initial recognition, is recalculated as the difference between the proceeds of the convertible notes as a whole and the fair value of the derivative financial liabilities. Subsequent to initial recognition, the derivative financial liability is re-measured at fair value at the end of each reporting period with changes in fair value recognized in the consolidated statements of comprehensive loss for each reporting period, while the debt component is accreted to the face value of the debt using the effective interest method. Incremental costs incurred in respect of raising capital or debt are charged against the equity or debt proceeds raised, unless the instrument to which the transaction costs relate is classified as held for trading, in which case the incremental costs are expensed to profit or loss immediately. | |
Income taxes [Policy Text Block] | (h) Income taxes Income tax expense comprises current income tax expense and deferred income tax expense. Current and deferred income taxes are recognized as an expense and included in profit or loss for the period, except to the extent that the tax arises from a transaction which is recognized in other comprehensive income or directly in shareholder's deficiency. Current income tax Current tax expense is the amount of income taxes payable (recoverable) in respect of the taxable income (tax loss) for a period. Current liabilities (assets) for the current and prior periods are measured at the amount expected to be paid to (recovered from) the taxation authorities, using the tax rates that have been enacted or substantively enacted by the end of the reporting period. Deferred income tax Deferred tax assets and liabilities are recognized for the temporary differences between transactions that have been included in the consolidated financial statements or income tax returns. Deferred income taxes are provided for using the liability method. Under the liability method, deferred income taxes are recognized for all significant temporary differences between that the tax and financial statement bases of assets and liabilities and for certain carry-forward items. Deferred income tax assets are recognized only to the extent that, in the opinion of management, it is probable that the deferred income tax assets will be realized. Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the year when the asset is realized or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted at the reporting period. Deferred income tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of the enactment or substantive enactment. Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against current tax liabilities and when they relate to income taxes levied by the same taxation authority and KWESST intends to settle its current tax assets and liabilities on a net basis. Investment tax credits Investment tax credits relating to scientific research and experimental development expenditures are recorded in the fiscal period the qualifying expenditures are incurred based on management's interpretation of applicable legislation in the Income Tax Act of Canada. Credits are recorded provided there is reasonable assurance that the tax credit will be realized. Credits claimed are subject to review by the Canada Revenue Agency. Credits claimed in connection with R&D activities are accounted for using the cost reduction method. Under this method, assistance and credits relating to the acquisition of equipment is deducted from the cost of the related assets, and those relating to current expenditures, which are primarily salaries and related benefits, are included in the determination of profit or loss as a reduction of the R&D expenses. | (j) Income taxes Income tax expense comprises current income tax expense and deferred income tax expense. Current and deferred income taxes are recognized as an expense and included in profit or loss for the period, except to the extent that the tax arises from a transaction which is recognized in other comprehensive income or directly in shareholder's deficiency. Current income tax Current tax expense is the amount of income taxes payable (recoverable) in respect of the taxable income (tax loss) for a period. Current liabilities (assets) for the current and prior periods are measured at the amount expected to be paid to (recovered from) the taxation authorities, using the tax rates that have been enacted or substantively enacted by the end of the reporting period. Deferred income tax Deferred tax assets and liabilities are recognized for the temporary differences between transactions and carrying amounts of assets and liabilities that have been included in the consolidated financial statements and the amounts used for taxation purposes. Deferred income taxes are provided for using the liability method. Under the liability method, deferred income taxes are recognized for all significant temporary differences between the tax and financial statement bases of assets and liabilities and for certain carry-forward items. Deferred income tax assets are recognized only to the extent that it is probable that the deferred income tax assets will be realized. Deferred tax assets are reviewed at each reporting date and are reduced to the extent it is no longer probable that the related tax benefit will be realized. Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the year when the asset is realized or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted at the reporting period. Deferred income tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of the enactment or substantive enactment. Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against current tax liabilities and when they relate to income taxes levied by the same taxation authority and we intend to settle our current tax assets and liabilities on a net basis. Investment tax credits Investment tax credits relating to scientific research and experimental development expenditures are recorded in the fiscal period the qualifying expenditures are incurred based on management's interpretation of applicable legislation in the Income Tax Act of Canada. Credits are recorded provided there is reasonable assurance that the tax credit will be realized. Credits claimed are subject to review by the Canada Revenue Agency. Credits claimed in connection with R&D activities are accounted for using the cost reduction method. Under this method, assistance and credits relating to the acquisition of equipment is deducted from the cost of the related assets, and those relating to current expenditures, which are primarily salaries and related benefits, are included in the determination of profit or loss as a reduction of the R&D expenses. |
Related party transactions [Policy Text Block] | (i) Related party transactions Parties are considered to be related if one party has the ability, directly or indirectly, to control the other party or exercise significant influence over the other party in making financial and operating decisions. Parties are also considered to be related if they are subject to common control or common significant influence. Related parties may be individuals or corporate entities. A transaction is considered to be a related party transaction when there is a transfer of resources or obligations between related parties. Related party transactions are in the normal course of business and have commercial substance. | (k) Related party transactions Parties are considered to be related if one party has the ability, directly or indirectly, to control the other party or exercise significant influence over the other party in making financial and operating decisions. Parties are also considered to be related if they are subject to common control or common significant influence. Related parties may be individuals or corporate entities. A transaction is considered to be a related party transaction when there is a transfer of resources or obligations between related parties. Related party transactions are in the normal course of business and have commercial substance. |
Share-based compensation [Policy Text Block] | (j) Share-based payments KWESST records share-based compensation related to its stock options and certain warrants granted from the Company. Stock-based compensation for stock options and warrants are measured at fair value using a Black Scholes option-pricing model. The market value of KWESST's shares on the date of the grant is used to determine the fair value of options and warrants. Each tranche of an award is considered a separate award with its own vesting period and grand date fair value. Compensation cost is recognized as employee benefits expense over the vesting period in which employees unconditionally become entitled to the award. The amount recognized as an expense is adjusted to reflect only the number of awards for which related service conditions are expected to be met, such that the amount ultimately recognized as an expense is based on the number of awards that meet the related service conditions at the vesting date. Where the terms of an equity-settled transaction award are modified, the minimum expense recognized is the expense as if the terms had not been modified and if the original terms of the award are met. An additional expense is recognized for any modification that increases the total fair value of the share-based payment transaction or is otherwise beneficial to the employees as measured at the date of acquisition. | (l) Share-based compensation We have a Long-Term Incentive Plan ("LTIP") in which we may grant stock options, restricted share units ("RSUs"), performance stock units ("PSUs"), deferred stock units ("DSUs"), and stock appreciation rights ("SARs") to directors, employees and consultants. We measure share-based compensation at fair value for all share-based awards granted under the LTIP. Equity-settled service award The grant date fair value of equity-settled share-based awards is recognized as an expense on a straight-line basis over the requisite service period, with a corresponding increase in equity, over the vesting period of the awards. For stock options, the grant date fair value is determined using the Black-Scholes option model. For share units, the grant date fair value is based on KWESST's closing stock price. Each tranche of an award is considered a separate award with its own vesting period and grand date fair value. The amount recognized as an expense is adjusted for estimated forfeitures. Equity-settled performance award The accounting for equity-settled performance award is the same as above, except compensation expense is subject to periodic adjustment based on the achievement of establishment performance criteria. Modified award Where the terms of an equity-settled transaction award are modified, the minimum expense recognized is the expense as if the terms had not been modified and if the original terms of the award are met. An additional expense is recognized for any modification that increases the total fair value of the share-based payment transaction or is otherwise beneficial to the employees as measured at the date of acquisition. |
Foreign currency [Policy Text Block] | (k) Foreign currency Transactions in foreign currencies are translated to the respective functional currencies of KWESST at the exchange rate in effect at the transaction date. Monetary assets and liabilities denominated in other than the functional currency are translated at the exchange rates in effect at the reporting date. Non-monetary items that are measured in terms of historical cost in other than the functional currency are translated using the exchange rate at the date of the transaction. The resulting exchange gains and losses are recognized in profit or loss. | (m) Foreign currency Foreign currency transactions The financial statements of KWESST and its Canadian wholly-owned subsidiaries are measured using CAD as the functional currency. Transactions in currencies other than in CAD are translated at the exchange rates prevailing at the dates of the transactions. At the end of each reporting period, monetary items denominated in foreign currencies are translated to the functional currency at the rates prevailing at that date. Exchange differences on monetary items are recognized in profit or loss in the period in which they arise. Non-monetary items carried at fair value that are denominated in foreign currencies are translated to the functional currency at the rates prevailing at the date when the fair value was determined. Non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the rates at the date of the transaction and are not subsequently retranslated. Foreign operations The financial statements of KWESST's U.S. owned subsidiaries are measured using the United States dollar ("USD") as its functional currency. Assets and liabilities have been translated into USD using exchange rates prevailing at the end of each reporting period. Income and expense items are translated at the average exchange rates for the period, unless exchange rates fluctuate significantly during that period, in which cases the exchange rates at the dates of the transactions are used. Exchange differences arising, if any, are recognized in other comprehensive income and accumulated in shareholders' equity. |
Earnings (loss) per share [Policy Text Block] | (l) Earnings (loss) per share Basic earnings (loss) per share is computed using the weighted average number of common shares outstanding during the period. KWESST uses the treasury stock method to compute the dilutive effect of options, warrants, and similar instruments. Under this method, the dilutive effect on earnings per share is calculated presuming the exercise of outstanding options, warrants, and similar instruments. It assumes that the proceeds of such exercise would be used to repurchase common shares at the average market price during the period. However, the calculation of diluted loss per share excludes the effects of various conversions and exercises of convertible debt, options and warrants that would be anti-dilutive. | (n) Earnings (loss) per share Basic earnings (loss) per share is computed using net earnings (loss) over the weighted average number of common shares outstanding during the period. We use the treasury stock method to compute the dilutive effect of options, warrants, and similar instruments. Under this method, the dilutive effect on earnings per share is calculated presuming the exercise of outstanding options, warrants, and similar instruments. It assumes that the proceeds of such exercise would be used to repurchase common shares at the average market price during the period. However, the calculation of diluted loss per share excludes the effects of various conversions and exercises of convertible debt, options and warrants that would be anti-dilutive. |
Reverse acquisition [Policy Text Block] | (m) Reverse acquisition KWESST was a capital pool company, which did not constitute a business as defined under IFRS 3 - Business Combination Application of the reverse acquisitions guidance by analogy results in the private operating entity KWESST Inc. being identified as the accounting acquirer, and the listed non-operating entity KWESST being identified as the accounting acquiree. The accounting acquirer is deemed to have issued shares to obtain control of the accounting acquiree KWESST. Because the QT is not within the scope of IFRS 3, KWESST accounted for it as an asset acquisition and the consideration as a share-based payment transaction which was accounted for in accordance with IFRS 2 - Share-based Payment According to IFRS 2, any difference in the fair value of the shares deemed to have been issued by the accounting acquirer and the fair value of the accounting acquiree's identifiable net assets represents a service received by the accounting acquirer. Regardless of the level of monetary or non-monetary assets owned by the non-listed operating entity, the entire difference was considered to be payment for a service of a stock exchange listing for its shares, and that no amount should be considered a cost of raising capital. The service received in the form of a stock exchange listing does not meet the definition of an intangible asset because it is not identifiable in accordance with IAS 38 Intangible Assets (it is not separable) and does not meet the definition of an asset that should be recognized in accordance with other Standards and the Conceptual Framework, therefore the services received was recognized as listing expense (included in merger & acquisition costs in the consolidated statements of net loss and comprehensive loss). | |
New accounting standards issued but not yet in effect [Policy Text Block] | New accounting standards issued but not yet in effect Classification of liabilities as current or non-current (Amendments to IAS 1) The IASB has published Classification of Liabilities as Current or Non-Current (Amendments to IAS 1), which clarified the guidance on whether a liability should be classified as either current or non-current. The amendments were as follows: (i) end of the reporting period (ii) (iii) This new guidance is effective for annual periods beginning on or after January 1, 2022. Earlier application is permitted. KWESST has not yet assessed the impact of adoption of this guidance. Further, there is currently a proposal outstanding that would defer the effective date until January 1, 2023. |
Basis of preparation (Tables)
Basis of preparation (Tables) | 12 Months Ended |
Sep. 30, 2022 | |
Disclosure Of Basis Of Preparation [Abstract] | |
Disclosure of interests in subsidiaries [Table Text Block] | Location Equity % KWESST Inc. Ottawa, Canada 100% 2720178 Ontario Inc. Bowmanville, Canada 100% Police Ordnance Company Inc. Bowmanville, Canada 100% KWESST U.S. Holdings Inc. Delaware, Canada 100% KWESST Defense Systems U.S. Inc. Virginia, United States 100% KWESST Public Safety Systems U.S. Inc. Virginia, United States 100% KWESST Public Safety Systems Canada Inc. Ottawa, Canada 100% |
Significant accounting polici_3
Significant accounting policies (Tables) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Sep. 30, 2022 | |
Disclosure Of Significant Accounting Policies [Abstract] | ||
Disclosure of detailed information about estimated useful lives of property and equipment [Table Text Block] | Property and equipment Rate Computer equipment 5 years Computer software 3 years Office furniture and equipment 5 years R&D equipment 5 years Leasehold improvements Shorter of useful life or remaining term of lease | Rate Computer equipment 3 years Computer software 3 years Office furniture and equipment 5 years Low-rate initial production equipment 5 years R&D equipment 5 years Sales demo equipment 2 years Leasehold improvements Shorter of useful life or remaining term of lease |
Acquisitions (Tables)
Acquisitions (Tables) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Sep. 30, 2022 | |
Police Ordnance [Member] | ||
Disclosure of detailed information about business combination [line items] | ||
Disclosure of purchase consideration [Table Text Block] | Number Fair Value Common shares 3,965 $ 377,503 Warrants 200,000 $ 132,000 Contingent shares 875 $ 83,319 Total fair value purchase consideration $ 592,822 | |
Disclosure of net cash inflow as at closing of acquisition [Table Text Block] | Cash assumed on acquisition $ 162,547 less: consideration paid in cash - Net cash inflow on acquisition $ 162,547 | |
Disclosure of total fair value consideration [Table Text Block] | Total purchase consideration at fair value $ 592,822 Police Ordnance's net assets: Cash 162,547 Trade and other receivables 104,432 Inventories 352,685 Intangible assets: Purchase orders 100,000 Customer relationships 50,000 ARWEN TM 44,000 Accounts payable and accrued liabilities 82,963 Corporate tax liability 32,338 Contract liabilities 29,861 Borrowings 26,238 Deferred tax liabilities 49,442 Net assets at fair value $ 592,822 | |
DEFSEC [Member] | ||
Disclosure of detailed information about business combination [line items] | ||
Disclosure of minimum annual royalty payments [Table Text Block] | Date Amount April 29 2023 $ 150,000 April 29 2024 $ 150,000 April 29 2025 $ 200,000 April 29 2026 $ 200,000 April 29 2027 $ 250,000 April 29 2028 $ 250,000 April 29 2029 $ 300,000 April 29 2030 $ 300,000 April 29 2031 $ 350,000 April 29 2032 $ 350,000 Total $ 2,500,000 | |
Disclosure of purchase consideration [Table Text Block] | Number Fair Value Common shares 14,286 $ 1,290,000 Warrants 500,000 $ 425,000 Minimum royalty payments $ 1,191,219 Total $ 2,906,219 Identifiable intangible assets Technology asset $ 2,906,219 | |
Foremost [Member] | ||
Disclosure of detailed information about business combination [line items] | ||
Disclosure of detailed information about fair value of the net assets acquired and total consideration transferred [Table Text Block] | Number of common shares issued to Foremost shareholders 12,836 KWESST's stock price at closing of reverse acquisition (1) $ 49.00 Common shares $ 628,949 Options 41,155 Total consideration transferred $ 670,104 | Number of common shares issued to Foremost shareholders 12,836 KWESST's stock price at closing of reverse acquisition (1) $ 49.00 Common shares $ 628,949 Options 41,155 Total consideration transferred $ 670,104 |
Disclosure of total fair value consideration [Table Text Block] | Total fair value consideration $ 670,104 Foremost's net assets (liabilities): Cash $ 78,589 Other receivables 1,900 Accounts payable and accrued liabilities (225,088 ) Net assets (liabilities) at fair value (144,599 ) Residual balance allocated to listing expense (included in M&A costs) 814,703 Total $ 670,104 | Total fair value consideration $ 670,104 Foremost's net assets (liabilities): Cash $ 78,589 Other receivables 1,900 Accounts payable and accrued liabilities (225,088 ) Net assets (liabilities) at fair value (144,599 ) Residual balance allocated to listing expense (included in M&A costs) 814,703 Total $ 670,104 |
SageGuild LLC [Member] | ||
Disclosure of detailed information about business combination [line items] | ||
Disclosure of purchase consideration [Table Text Block] | Cash consideration $ 134,192 Share issuance with no condition 33,600 Elected share issuances 133,680 Contingent consideration 180,000 Total purchase consideration $ 481,472 |
Trade and other receivables (Ta
Trade and other receivables (Tables) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Sep. 30, 2022 | |
Trade and other receivables [abstract] | ||
Disclosure of detailed information about trade and other receivables [Table Text Block] | September 30, 2020 December 31, 2019 Trade receivables $ 210,795 $ 1,191 Sales tax recoverable 142,797 55,684 Investment tax credits refundable 127,325 162,928 Total $ 480,917 $ 219,803 | September 30, September 30, 2022 2021 Trade receivables $ 114,877 $ - Unbilled revenue 8,881 308,728 Sales tax recoverable 48,124 183,761 Investment tax credits refundable - 206,762 Total $ 171,882 $ 699,251 |
Disclosure of detailed information about unbilled trade and other receivables [Table Text Block] | September 30, September 30, 2022 2021 Balance, beginning of year $ 308,728 $ - Revenue billed during the year (308,728 ) Revenue in excess of billings, net of amounts transferred to trade accounts receivable 8,881 308,728 Amounts written off - - Balance, end of year $ 8,881 $ 308,728 Current $ 8,881 $ 308,728 Non-current $ - $ - |
Inventories (Tables)
Inventories (Tables) | 12 Months Ended |
Sep. 30, 2022 | |
Disclosure Of Inventories [Abstract] | |
Disclosure of detailed information about inventories [Table Text Block] | September 30, September 30, 2022 2021 Finished goods $ 49,643 $ - Work-in-progress 21,350 - Raw materials 322,545 90,299 Total $ 393,538 $ 90,299 |
Property and equipment (Tables)
Property and equipment (Tables) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Sep. 30, 2022 | |
Disclosure of detailed information about property, plant and equipment [abstract] | ||
Disclosure of detailed information about property, plant and equipment [Table Text Block] | Cost Computer Computer Office R&D Leasehold Total Balance at December 31, 2018 $ - $ 8,145 $ 31,873 $ 41,379 $ 8,607 $ 90,004 Additions 14,073 - 908 5,209 - 20,190 Disposals - - - - - - Balance at December 31 2019 $ 14,073 $ 8,145 $ 32,781 $ 46,588 $ 8,607 $ 110,194 Additions 18,734 - 49,060 7,046 59,090 133,930 Disposals - - - - (8,607 ) (8,607 ) Balance at September 30, 2020 $ 32,807 $ 8,145 $ 81,841 $ 53,634 $ 59,090 $ 235,517 Accumulated depreciation Computer Computer Office R&D Leasehold Total Balance at December 31, 2018 $ - $ 3,396 $ 9,587 $ 5,257 $ 2,497 $ 20,737 Amortization for 12 months 241 2,715 6,556 8,102 1,721 19,335 Balance at December 31, 2019 $ 241 $ 6,111 $ 16,143 $ 13,359 $ 4,218 $ 40,072 Amortization for 9 months 5,821 1,526 6,149 7,478 8,434 29,408 Disposals - - - - (8,607 ) (8,607 ) Balance at September 30, 2020 $ 6,062 $ 7,637 $ 22,292 $ 20,837 $ 4,045 $ 60,873 Carrying value at December 31, 2019 $ 13,832 $ 2,034 $ 16,638 $ 33,229 $ 4,389 $ 70,122 Carrying value at September 30, 2020 $ 26,745 $ 508 $ 59,549 $ 32,797 $ 55,045 $ 174,644 | Office LRIP Computer Computer furniture and R&D Leasehold Sales demo Cost equipment software equipment equipment (1) equipment improvements equipment Total Balance, September 30, 2020 $ 32,807 $ 8,145 $ 81,841 $ - $ 53,634 $ 59,090 $ - $ 235,517 Additions 30,778 - 11,211 - 165,030 58,147 548,626 813,792 Disposals (3,828 ) (8,145 ) (2,936 ) - (724 ) - - (15,633 ) Balance at September 30, 2021 $ 59,757 $ - $ 90,116 $ - $ 217,940 117,237 $ 548,626 $ 1,033,676 Additions 50,849 5,129 10,817 77,559 21,864 19,800 1,460 187,478 Disposals (3,800 ) - - - - - - (3,800 ) Balance at September 30, 2022 $ 106,806 $ 5,129 $ 100,933 $ 77,559 $ 239,804 $ 137,037 $ 550,086 1,217,354 Office Computer Computer furniture and Moulding R&D Leasehold Sales demo Accumulated depreciation equipment software equipment equipment equipment improvements equipment Total Balance, September 30, 2020 $ 6,062 $ 7,637 $ 22,292 $ - $ 20,837 $ 4,045 - $ $60,873 Depreciation for the year 13,966 508 18,759 - 17,462 12,489 16,444 79,628 Disposals (1,630 ) (8,145 ) (687 ) - (12 ) - - (10,474 ) Balance at September 30, 2021 $ 18,398 $ - $ 40,364 $ - $ 38,287 $ 16,534 16,444 $ 130,027 Depreciation for the year 26,762 1,254 19,067 7,002 46,219 27,915 129,262 257,481 Disposals (2,635 ) - - - - - - (2,635 ) Balance at September 30, 2022 $ 42,525 $ 1,254 $ 59,431 $ 7,002 $ 84,506 $ 44,449 $ 145,706 $ 384,873 Carrying value at September 30, 2021 $ 41,359 $ - $ 49,752 $ 49,752 $ 179,653 $ 100,703 $ 532,182 $ 903,649 Carrying value at September 30, 2022 $ 64,281 $ 3,875 $ 41,502 $ 70,557 $ 155,298 $ 92,588 $ 404,380 $ 832,481 |
Right-of-use assets (Tables)
Right-of-use assets (Tables) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Sep. 30, 2022 | |
Disclosure Of Right Of Use Assets [Abstract] | ||
Disclosure of detailed information about right-of-use assets [Table Text Block] | Offices Printer Total Balance at December 31, 2018 $ 254,159 $ 13,120 $ 267,279 Depreciation (76,248 ) (6,559 ) (82,807 ) Balance at December 31, 2019 $ 177,911 $ 6,561 $ 184,472 Additions 571,604 - 571,604 Termination (139,787 ) - (139,787 ) Depreciation (92,567 ) (3,282 ) (95,849 ) Balance at September 30, 2020 (as previously reported) 517,161 3,279 520,440 Correction of an error (192,864 ) - (192,864 ) Balance at September 30, 2020 (as adjusted) $ 324,297 $ 3,279 $ 327,576 | Offices Printer Total Balance at September 30, 2020 324,297 3,279 327,576 Depreciation (58,083 ) (3,279 ) (61,362 ) Balance at September 30, 2021 $ 266,214 $ - $ 266,214 Depreciation (58,083 ) - (58,083 ) Balance at September 30, 2022 $ 208,131 $ - $ 208,131 |
Disclosure of detailed information about consolidated statements of financial position [Table Text Block] | Previously Adjustment Adjusted Trade and other receivables $ 479,291 $ 1,626 $ 480,917 Right-of-assets $ 520,440 $ (192,864 ) $ 327,576 Deposit (non-current) $ 22,337 $ (2,996 ) $ 19,341 Total assets $ 5,507,011 $ (194,234 ) $ 5,312,777 Lease obligations (current) $ 78,358 $ (34,230 ) $ 44,128 Lease obligations (non-current) $ 496,394 $ (188,485 ) $ 307,909 Total liabilities $ 1,650,628 $ (222,715 ) $ 1,427,913 Deficit $ (6,102,058 ) $ 28,481 $ (6,073,577 ) | |
Disclosure of detailed information about consolidated statements of changes in shareholders' equity (deficit) [Table Text Block] | Previously Adjustment Adjusted Deficit $ (6,102,058 ) $ 28,481 $ (6,073,577 ) Total shareholders' equity (deficit) $ 3,856,383 $ 28,481 $ 3,884,864 |
Intangible assets (Tables)
Intangible assets (Tables) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Sep. 30, 2022 | |
Disclosure of detailed information about intangible assets [abstract] | ||
Disclosure of detailed information about intangible assets [Table Text Block] | Development Technology Total Cost Balance at December 31, 2019 $ - $ - $ - Additions 163,230 - 163,230 Additions through acquisition (Note 4) - 481,472 481,472 Balance at September 30, 2020 $ 163,230 $ 481,472 $ 644,702 | TASCS Phantom TM PARA OPS TM PARA OPS TM ARWEN TM Customer Purchase Cost System System System Patent Tradename Relationships Orders Total Balance at September 30, 2020 $ 163,230 $ 481,472 $ - $ - $ - $ - $ - $ 644,702 Additions - 83,228 - - - - - 83,228 Acquisition (Note 4(b)) - - 2,906,219 - - - - 2,906,219 Transferred to cost of sales (107,854 ) - - - - - - (107,854 ) Impairment charge (55,376 ) - - - - - - (55,376 ) Balance at September 30, 2021 - $ 564,700 $ 2,906,219 $ - $ - $ - $ - $ 3,470,919 Additions - 584,885 562,996 28,783 - - - 1,176,664 Acquisition (Note 4(a)) - - - - 44,000 50,000 100,000 194,000 Amortization - - - - (6,968 ) (3,959 ) - (10,927 ) Recognition of open orders - - - - - - (87,802 ) (87,802 ) Balance at September 30, 2022 $ - $ 1,149,585 $ 3,469,215 $ 28,783 $ 37,032 $ 46,041 $ 12,198 $ 4,742,854 |
Accounts payable and accrued _2
Accounts payable and accrued liabilities (Tables) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Sep. 30, 2022 | |
Trade and other current payables [abstract] | ||
Disclosure of detailed information about accounts payable and accrued liabilities [Table Text Block] | September 30, December 31, Trade payable $ 493,027 $ 126,481 Accrued liabilities 188,265 29,822 Payroll taxes payable 67,229 - Salary and vacation payable 65,722 29,343 Other 4,031 13,041 Total $ 818,274 $ 198,687 | September 30, September 30, 2022 2021 Trade payable $ 2,292,954 $ 620,041 Accrued liabilities 1,045,409 384,239 Salary, bonus and vacation payable 1,116,203 122,230 Interest payable 4,915 - Payroll taxes payable - 692 Total $ 4,459,481 $ 1,127,202 |
Related party transactions (Tab
Related party transactions (Tables) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Sep. 30, 2022 | |
Disclosure of transactions between related parties [abstract] | ||
Disclosure of information about key management personnel compensation [Table Text Block] | Nine months September 30, 2020 Twelve months Wages and benefits $ 165,769 $ 48,343 Consulting fees 145,000 30,000 Directors compensation - - Share-based compensation 24,959 - Total $ 335,728 $ 78,343 | Year ended Year ended Nine months ended September 30, September 30, September 30, 2022 2021 2020 Wages and benefits $ 641,338 $ 427,252 $ 165,769 Consulting fees 529,529 180,000 145,000 Directors compensation 70,000 85,000 - Share-based compensation 860,400 988,716 24,959 Total $ 2,101,267 $ 1,680,968 $ 335,728 |
Disclosure of related party loans [Table Text Block] | Loans from (1) Employee (2), (5) Loans from (3), (4) Total Balance at December 31, 2018 $ 612,171 $ 81,253 $ 191,789 $ 885,213 Additions 309,912 - 772 310,684 Transferred to convertible debentures - - (192,561 ) (192,561 ) Converted into common shares (649,500 ) - - (649,500 ) Converted into warrants (19,858 ) - - (19,858 ) Repayment of loans (45,513 ) (25,000 ) - (70,513 ) Accrued interest 22,706 3,657 - 26,363 Balance at December 31, 2019 $ 229,918 $ 59,910 $ - $ 289,828 Repayment of loans (30,000 ) (50,000 ) - (80,000 ) Accrued interest 7,174 1,274 - 8,448 Balance at September 30, 2020 $ 207,092 $ 11,184 $ - $ 218,276 | CEO Employee loan loan Total Balance, September 30, 2020 $ 207,092 $ 11,184 $ 218,276 Accrued interest 4,513 68 4,581 Repayment of loans (211,605 ) (11,252 ) (222,857 ) Balance, September 30, 2021 $ - $ - $ - |
Borrowings (Tables)
Borrowings (Tables) | 12 Months Ended |
Sep. 30, 2022 | |
Borrowings [abstract] | |
Disclosure of changes in borrowings [Table Text Block] | CEBA Term February 2021 March 2022 August 2022 Total Loans Loan Loans Loans Borrowings Balance, September 30, 2020 $ 32,273 $ - $ - $ - $ 32,273 Additional borrowings 20,000 306,000 - - 326,000 Gain on government grant (3,514 ) - - - (3,514 ) Accrued interest 4,492 4,527 - - 9,019 Repayment - (310,527 ) - - (310,527 ) Balance, September 30, 2021 $ 53,251 $ - $ - $ - $ 53,251 Assumed from acquisition (Note 4) 26,238 - - - 26,238 Issuance at fair value - - 1,634,283 475,591 2,109,874 Deferred financing fees - - (74,055 ) (76,354 ) (150,409 ) Net borrowings 79,489 - 1,560,228 399,237 2,038,954 Adjustment (5,496 ) - - - (5,496 ) Accrued interest and accretion expense 4,803 - 304,922 11,588 321,313 Foreign exchange loss - - - 24,523 24,523 Interest paid - - (100,520 ) - (100,520 ) Balance, September 30, 2022 $ 78,796 $ - $ 1,764,630 $ 435,348 $ 2,278,774 Current $ - $ - $ 1,764,630 $ 435,348 $ 2,199,978 Non-current 78,796 - - $ 78,796 Total $ 78,796 $ - $ 1,764,630 $ 435,348 $ 2,278,774 |
Lease obligations (Tables)
Lease obligations (Tables) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Sep. 30, 2022 | |
Presentation of leases for lessee [abstract] | ||
Disclosure of detailed information about lease obligations [Table Text Block] | Offices Printer Total Current Portion Non-current Balance, December 31, 2018 $ 266,292 $ 13,761 $ 280,053 $ 77,367 $ 202,686 Lease payments (including interest) (94,270 ) (7,620 ) (101,890 ) - - Interest expense 23,441 1,082 24,523 - - Balance, December 31, 2019 $ 195,463 $ 7,223 $ 202,686 $ 85,468 $ 117,218 Addition 347,640 - 347,640 Termination (157,315 ) - (157,315 ) Lease payments (including interest) (62,816 ) (7,620 ) (70,436 ) Interest expense 29,065 397 29,462 Balance, September 30, 2020 (as adjusted) $ 352,037 $ - $ 352,037 $ 44,128 $ 307,909 | Current Non-current Offices Portion portion Balance, September 30, 2020 $ 352,037 $ 44,128 $ 307,909 Lease payments (including interest) (78,000 ) - - Interest expense 33,872 - - Balance at September 30, 2021 $ 307,909 $ 32,288 $ 275,621 Lease payments (including interest) (62,400 ) - - Interest expense 30,112 - - Balance at September 30, 2022 $ 275,621 $ 69,150 $ 206,471 |
Disclosure of contractual undiscounted cash flows of lease obligations [Table Text Block] | September 30, December 31, Less than one year $ 78,000 $ 101,890 One to five years 390,000 125,693 Total $ 468,000 $ 227,583 | September 30, September 30, 2022 2021 Less than one year $ 93,600 $ 62,400 One to five years 234,000 327,600 Total $ 327,600 $ 390,000 |
Contract Liabilities (Tables)
Contract Liabilities (Tables) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Sep. 30, 2022 | |
Contract liabilities [abstract] | ||
Disclosure of detailed information about contract liabilities [Table Text Block] | September 30, 2020 December 31, 2019 Balance, beginning of period $ - $ - Amounts invoiced and revenue deferred 7,053 - Recognition of deferred revenue included in the balance at the beginning of period - - Balance, end of period $ 7,053 $ - | September 30, September 30, 2022 2021 Balance, beginning of fiscal year $ - $ 7,053 Acquired in acquisition of POC (see Note 4(a)) 29,759 - Amounts invoiced and revenue deferred 17,512 - Recognition of deferred revenue included in the balance at the beginning of period - (7,053 ) Balance, end of fiscal year $ 47,271 $ - |
Financial derivative liabilit_2
Financial derivative liabilities (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Disclosure of maturity analysis for derivative financial liabilities [abstract] | |
Disclosure of detailed information about financial derivative liabilities [Table Text Block] | Total Balance at December 31, 2018 $ 111,953 Fair value adjustment when notes were converted into common shares (111,953 ) Fair value of financial derivative liabilities on initial recognition 30,688 Fair value adjustment (1,225 ) Balance at December 31, 2019 29,463 Fair value adjustment (29,463 ) Balance at September 30, 2020 $ - |
Convertible notes (Tables)
Convertible notes (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Disclosure of detailed information about borrowings [abstract] | |
Disclosure of detailed information about convertible notes [Table Text Block] | Balance at December 31, 2018 $ 521,515 Related party loans transferred to convertible notes (Note 10) 192,561 Converted into common shares (Note 16) (620,897 ) Repayment of debt (31,644 ) Less fair value of conversion feature (30,688 ) Accrued interest 74,707 Accretion expenses 105,265 Balance at December 31, 2019 210,819 Accrued interest 16,769 Accretion expenses 28,130 Converted in common shares (Note 16) (255,718 ) Balance at September 30, 2020 $ - |
Share capital and Contributed_2
Share capital and Contributed Surplus (Tables) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Sep. 30, 2022 | |
Disclosure of classes of share capital [abstract] | ||
Disclosure of issued common shares [Table Text Block] | Number Issued Price Amount Outstanding at December 2018 3 $ 66.67 $ 200 Issued for directors converted loans (1) 92,857 $ 0.34 31,308 Issued for parent company converted loans (2) 152,857 $ 3.06 467,000 Issued for directors converted loans (3) 21,429 $ 7.00 150,000 Issued for converted debt and accrued interest (4) 44,350 $ 14.00 620,897 Issued in private placement (5) 72,500 $ 14.00 1,014,948 Outstanding at December 31, 2019 383,996 $ 2,284,353 Issued in private placement (6) 37,500 $ 28.00 1,050,000 Issued in private placement (6) 12,082 $ 35.00 422,875 Issued in asset acquisition (7) 9,957 $ 16.80 167,280 Issued for converted debt and accrued interest (8) 6,523 $ 39.20 255,718 Issued for new converted debt and accrued interest (9) 45,858 $ 28.96 1,328,163 Issued in private placement (10) 229 $ 34.93 8,000 Issued for consulting services (11) 871 $ 37.19 32,393 Issued for exercise of stock options (12) 1,743 $ 44.80 78,080 Issued for performance bonus (13) 14,929 $ 49.00 731,500 Issued in brokered private placement (14) 62,994 $ 49.01 3,087,138 Shares from Foremost's QT (15) 12,836 $ 49.00 628,949 Outstanding at September 30, 2020 589,518 $ 10,074,449 Less: share offering costs (699,886 ) Total share capital at September 30, 2020 $ 9,374,563 | September 30, 2022 September 30, 2021 September 30, 2020 Number Amount Number Amount Number Amount Balance, beginning of year 699,511 $ 17,215,068 589,518 $ 9,374,563 383,996 $ 2,284,353 Issued in private placement 22,857 $ 272,000 10,714 $ 1,110,000 49,811 $ 1,480,875 Issued for exercise of warrants 19,000 $ 277,098 10,380 $ 815,307 - $ - Issued for bonus shares relating to borrowings (Note 10) 18,525 $ 411,692 - $ - - $ - Issued for conversion of share units 8,349 $ 874,840 138 $ 12,498 - $ - Issued for acquisition (Note 4(a)) 3,965 $ 377,503 - $ - - $ - Issued for conversion of contingent shares (Note 4(a)) 875 $ 83,319 - $ - - $ - Issued for debt settlements 143 $ 19,000 1,305 $ 63,866 - $ - Issued in brokered private placement - $ - 51,087 $ 3,611,818 62,994 $ 3,087,138 Issued for exercise of stock options - $ - 18,195 $ 1,292,015 1,743 $ 78,080 Issued for asset acquisition (Note 4(b)) - $ - 14,286 $ 1,290,000 9,957 $ 167,280 Issued for exercise of broker compensation options - $ - 2,459 $ 347,680 - $ - Issued for amended license (Note 26) - $ - 1,429 $ 137,000 - $ - Issued for conversion of 15% 2020 converted notes - $ - - $ - 45,858 $ 1,328,163 Issued for performance bonus - $ - - $ - 14,929 $ 731,500 Shares from Foremost's QT (Note 4(c)) - $ - - $ - 12,836 $ 628,949 Issued for conversion of 10% 2019 converted notes - $ - - $ - 6,523 $ 255,718 Issued for consulting services - $ - - $ - 871 $ 32,393 Less: share offering costs for the year - $ (33,880 ) - $ (839,679 ) - $ (699,886 ) Balance, end of year 773,225 $ 19,496,640 699,511 $ 17,215,068 589,518 $ 9,374,563 |
Disclosure of warrant activity [Table Text Block] | # of Exercise Fair Value Weighted Expiry Date Warrants outstanding at December 31 2018 - $ - $ - - Granted 6,500,000 $ 0.20 $ 1,192 3.25 January 1 2024 Granted 2,000,000 $ 0.20 $ 19,858 3.71 June 14 2024 Warrants outstanding at December 31, 2019 8,500,000 $ 1,192 Issued in private placement 15,000 $ 0.40 $ 2,265 1.33 January 30 2022 Issued in private placement 84,622 $ 0.45 $ 13,515 1.60 May 8 2022 Issued in asset acquisition (see Note 4) 750,000 $ 0.50 $ 180,000 2.29 June 12 2022 Issued in private placement 235,428 $ 0.70 $ 60,340 1.77 July 9 2022 Warrants outstanding at September 30, 2020 9,585,050 $ 257,312 3.22 | September 30, 2022 September 30, 2021 September 30, 2020 Weighted Weighted Weighted Number of average Number of average exercise Number of average exercise warrants exercise price warrants price warrants price Outstanding, beginning of year 13,901,640 $ 0.74 9,585,050 $ 0.24 8,500,000 $ 0.20 Issued 1,000,000 $ 0.57 5,043,165 $ 1.73 1,085,050 $ 0.54 Exercised (1,330,000 ) $ 0.26 (726,575 ) $ 1.05 - $ - Expired (154,484 ) $ 0.56 - $ - - $ - Outstanding, end of year 13,417,156 $ 0.78 13,901,640 $ 0.74 9,585,050 $ 0.24 Exercisable, end of year 12,792,156 $ 0.82 12,901,640 $ 0.75 8,835,050 $ 0.22 |
Disclosure of additional information on outstanding warrants [Table Text Block] | Number outstanding Fair value (1) Expiry Date Founders' warrants: Exercise price of $0.20 5,520,000 $ 1,013 January 1, 2024 Exercise price of $0.20 1,900,000 $ 18,865 June 14, 2024 GhostStep's warrants: Exercise price of $0.50 250,000 $ 60,000 January 15, 2023 April 2021 equity financing: Exercise price of $1.75 3,274,657 $ 785,918 April 29, 2023 Exercise price of $1.75 40,000 $ 9,600 August 25, 2023 LEC's warrants (see Note 4(b)): Exercise price of $0.70 500,000 $ 425,000 April 29, 2026 September 2021 equity financing: Exercise price of $2.35 750,000 $ 390,000 September 16, 2023 Broker warrants: Exercise price of $1.75 137,499 $ 33,000 April 29, 2023 Exercise price of $2.00 45,000 $ 32,400 September 16, 2023 Acquisition of Police Ordnance (Note 4(a)): Exercise price of $1.72 200,000 $ 132,000 December 15, 2024 July 2022 equity financing Exercise price of $0.285 800,000 $ 72,000 July 14, 2024 13,417,156 $ 1,959,796 | |
Disclosure of weighted-average assumptions of warrants granted [Table Text Block] | Warrants 1/70 of stock price $ 0.044 Volatility 66.75% Dividend Yield Nil Risk-free interest rate 1.40% Expected life 5 Weighted average fair value per warrant $ 0.0099 Warrants $0.40 Warrants $0.45 Warrants $0.70 1/70 of stock price $ 0.40 $ 0.50 $ 0.70 Volatility 68% 68% 67% Dividend Yield Nil Nil Nil Risk-free interest rate 1.47% 0.27% 0.29% Expected life 2 2 2 Estimated fair value per warrant $ 0.15 $ 0.20 $ 0.26 | Acquisition of POC July 2022 Warrants Exercise Price $ 1.72 $ 0.285 1/70 of stock price $ 1.36 $ 0.215 Volatility 84.7% 90.5% Dividend Yield Nil Nil Risk-free interest rate 1.04% 3.12% Expected life 3 2 Weighted average fair value per warrant $ 0.66 $ 0.09 Barrier Option Model Black-Scholes Option Model April 2021 September 2021 warrants September 2021 LEC warrants Exercise Price $ 1.75 $ 2.35 $ 2.00 $ 0.70 1/70 of stock price $ 1.01 $ 2.14 $ 2.14 $ 0.40 Volatility 80% 80% 80% 0% Dividend Yield Nil Nil Nil Nil Risk-free interest rate 0.31% 0.26% 0.26% 69.00% Barrier (accelerator on life of warrants) $ 3.00 $ 4.60 N/A N/A Rebate $ 1.25 $ 2.00 N/A N/A Expected life 2 1 1 0.85 Weighted average fair value per warrant $ 0.24 $ 0.52 $ 0.72 $ 0.85 Warrants Warrants Warrants $0.40 $0.45 $0.70 1/70 of stock price $ 0.40 $ 0.50 $ 0.70 Volatility 68% 68% 67% Dividend Yield Nil Nil Nil Risk-free interest rate 1.47% 0.27% 0.29% Expected life 2 2 2 Estimated fair value per warrant $ 0.15 $ 0.20 $ 0.26 |
Disclosure of number and weighted average exercise prices of share options [Table Text Block] | Number of Weighted Options outstanding at December 31, 2019 - $ - Granted 29,357 45.50 Options from the Foremost qualifying transaction 1,224 32.90 Exercised (1,743 ) 35.00 Options outstanding at September 30, 2020 28,838 $ 45.50 Options exercisable at September 30, 2020 7,474 $ 42.00 | Weighted Number of average options exercise price Outstanding at December 31, 2019 - $ - Granted 29,357 $ 45.50 Options from the Qualifying Transaction 1,224 $ 32.90 Exercised (1,743 ) $ 35.00 Outstanding at September 30, 2020 28,838 $ 45.50 Granted 52,988 $ 104.30 Exercised (18,194 ) $ 50.40 Cancelled (4,096 ) $ 48.30 Outstanding at September 30, 2021 59,536 $ 95.90 Granted 9,500 $ 69.59 Cancelled (11,928 ) $ 131.76 Outstanding at September 30, 2022 57,108 $ 83.87 Options exercisable at September 30, 2022 43,618 $ 83.90 |
Disclosure of weighted-average assumptions of stock options granted [Table Text Block] | Stock price $28.00 to $49.00 Exercise price $28.00 to $49.00 Volatility 67.71% Dividend Yield Nil Risk-free interest rate 0.65% Expected life (years) 4.15 Weighted-average fair value per option $ 16.10 | 2022 2021 2020 $ 14.70 to $ 49.00 to $ 28.00 to Stock price $ 126.70 $ 159.60 $ 49.00 $ 14.70 to $ 49.00 to $ 28.00 to Exercise price $ 126.70 $ 159.60 $ 49.00 Volatility 90.48% 76.46% 67.71% Dividend yield Nil Nil Nil Risk-free interest rate 2.04% 0.35% 65.00% Expected life (years) 2.91 2.26 3.38 Weighted-average fair value per option $ 38.21 $ 50.40 $ 16.10 |
Disclosure of range of exercise prices of outstanding share options [Table Text Block] | Range of Number Weighted Number $33.00 1,224 2.71 1,224 $35.00 2,614 0.67 - $46.00 13,214 4.41 3,304 $49.00 11,786 4.79 2,946 28,838 4.15 7,474 | Weighted average Weighted Remaining Weighted Range of remaining average exercisable average exercise Number contractual outstanding contractual exercisable prices outstanding life strike price Exercisable life strike price $14.70 to $41.16 4,592 4.54 $ 15.91 306 0.71 $ 32.90 $41.17 to $67.63 12,329 2.74 $ 48.74 12,329 2.74 $ 48.74 $67.64 to $94.10 20,973 3.47 $ 78.02 17,080 3.38 $ 75.79 $94.11 to 120.57 7,448 3.34 $ 118.59 7,448 3.34 $ 118.59 $120.58 to $147.00 11,766 3.95 $ 135.66 6,455 3.97 $ 134.87 57,108 3.48 $ 83.87 43,618 3.26 $ 83.90 |
Disclosure of changes in share units [Table Text Block] | RSUs PSUs SARs Total Outstanding at September 30, 2020 - - - - Granted 16,412 2,857 2,143 21,412 Vested and converted (139 ) - - (139 ) Outstanding at September 30, 2021 16,273 2,857 2,143 21,273 Granted 10,726 17,942 514 28,668 Vested and converted to common shares (5,681 ) (2,666 ) - (8,347 ) Vested and repurchased for withholding taxes (144 ) (249 ) - (393 ) Expired / cancelled - (17,714 ) - (17,714 ) Outstanding at September 30, 2022 21,174 170 2,657 24,001 | |
Disclosure of share based compensation expense by function [Table Text Block] | Year ended Year ended Nine months ended September 30, September 30, September 30, 2022 2021 2020 General and administrative $ 1,104,858 $ 1,425,111 $ 160,267 Selling and marketing 552,627 754,167 42,700 Research and development, net 302,587 282,929 80,117 Total share-based compensation $ 1,960,072 $ 2,462,207 $ 283,084 |
Earnings (loss) per share (Tabl
Earnings (loss) per share (Tables) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Sep. 30, 2022 | |
Earnings per share [abstract] | ||
Disclosure of detailed information about earnings (loss) per share [Table Text Block] | Nine months Twelve Issued common shares, beginning of period 383,996 3 Effect of shares issued from: Conversion of directors converted loans - 101,174 Conversion of parent company converted loans - 126,055 Exercise of options 447 - Conversion of convertible notes, including interest 7,126 21,769 Issuance for services 1,373 - Issuance for technology acquisition (Note 4 (b)) 1,272 - Issuance of for equity private placements 45,665 - Qualifying transaction (Note 4(a)) 752 - Weighted average number of basic common shares 440,631 249,001 Dilutive securities: Stock options - - Warrants - - Weighted average number of dilutive common shares 440,631 249,001 | Year ended Year ended Nine months ended September 30, September 30, September 30, 2022 2021 2020 Issued common shares, beginning of year 699,511 589,518 383,996 Effect of shares issued from: Exercise of warrants 10,593 4,383 - Issuance of bonus shares (Note 10) 8,262 - - Private placements 4,571 21,810 45,665 Conversion of stock units 3,703 31 - Acquisition of Police Ordnance (Note 4(a)) 3,144 - - Conversion of contingent shares (Note 4(a)) 386 - - Debt settlements 132 1,038 - Exercise of options - 9,118 447 Asset acquisitions (Note 4(b)) - 6,027 1,272 Amended license agreement (Note 26) - 626 - Exercise of broker options - 170 - Conversion of convertible notes, including interest - - 7,126 Services rendered - - 1,373 Foremost's QT - - 752 Weighted average number of basic common shares 730,302 632,721 440,631 Dilutive securities: Stock options - - - Warrants - - - Weighted average number of dilutive common shares 730,302 632,721 440,631 |
Revenue (Tables)
Revenue (Tables) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Sep. 30, 2022 | |
Revenue [abstract] | ||
Disclosure of detailed information about revenue [Table Text Block] | Nine months Twelve months Systems $ 835,097 $ 472,749 Other 26,820 36,399 $ 861,917 $ 509,148 | Nine months Year ended Year ended ended September 30, September 30, September 30, 2022 2021 2020 Major products / service lines Digitization $ 354,620 $ 1,255,982 $ 835,097 Non-Lethal 330,658 - - Training and services 34,590 - - Other 1,651 19,822 26,820 $ 721,519 $ 1,275,804 $ 861,917 Primary geographical markets United States $ 389,210 $ 1,238,063 $ 835,097 Canada 332,309 37,741 26,820 $ 721,519 $ 1,275,804 $ 861,917 Timing of revenue recognition Products and services transferred over time $ 389,210 $ 1,238,063 $ 835,097 Products transferred at a point in time 332,309 37,741 26,820 $ 721,519 $ 1,275,804 $ 861,917 |
Expenses by nature (Tables)
Expenses by nature (Tables) | 12 Months Ended |
Sep. 30, 2022 | |
Expenses by nature [abstract] | |
Disclosure of detailed information about expenses by nature [Table Text Block] | Year ended Year ended Nine months September 30, September 30, ended 2022 2021 September 30, Employee benefits $ 4,883,062 $ 4,746,316 $ 1,161,071 Advertising and promotion 1,352,750 1,914,630 220,946 Consulting fees 1,315,917 1,138,782 620,295 Professional fees 1,028,240 778,337 190,398 Travel and conferences 518,140 246,418 112,360 R&D consulting and material costs, net 420,378 482,348 100,483 Depreciation and amortization 326,491 140,990 103,397 Other expenses 266,822 252,961 106,006 Insurance 236,150 154,931 - Transfer agent and listing fees 94,885 110,769 - Royalty and license costs - 287,000 - M&A costs - - 1,561,860 Total expenses 10,442,835 10,253,482 4,176,816 Allocation to cost of sales: Employee benefits (166,706 ) (574,018 ) (71,105 ) Total operating expenses $ 10,276,129 $ 9,679,464 $ 4,105,711 |
Depreciation and Amortization (
Depreciation and Amortization (Tables) | 12 Months Ended |
Sep. 30, 2022 | |
Disclosure of attribution of expenses by nature to their function [abstract] | |
Disclosure of detailed information about depreciation and amortization [Table Text Block] | 2022 2021 2020 General and administrative $ 123,960 $ 95,310 $ 89,307 Selling and marketing 129,265 16,443 - Research and development 73,266 29,237 14,090 Total depreciation and amortization $ 326,491 $ 140,990 $ 103,397 |
Net finance costs (Tables)
Net finance costs (Tables) | 12 Months Ended |
Sep. 30, 2022 | |
Disclosure Of Net Finance Cost [Abstract] | |
Disclosure of detailed information about net finance cost [Table Text Block] | Year ended Year ended Nine months ended September 30, September 30, September 30, 2022 2021 2020 Interest expense from: Unsecured loan $ 321,313 $ 4,527 $ - Accretion cost - accrued royalties liability 159,451 64,537 - Lease obligations 30,112 33,872 31,242 Related party loans - 4,581 8,448 CEBA term loan - 4,481 - 2019 convertible notes - - 44,899 Other 1,114 4,115 5,885 Total interest expense 511,990 116,113 90,474 Interest income (5,988 ) (4,848 ) (2,454 ) Gain on termination of lease obligations - - (17,527 ) Gain on government grant - (3,514 ) (9,096 ) Net finance costs $ 506,002 $ 107,751 $ 61,397 |
Income taxes (Tables)
Income taxes (Tables) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Sep. 30, 2022 | |
Major components of tax expense (income) [abstract] | ||
Disclosure of income tax recovery [Table Text Block] | Nine months Year end ended Year ended ended September 30, September 30, September 30, 2022 2021 2020 Current income tax recovery (expense): $ - $ - $ - Deferred income tax (recovery) expense: (49,442 ) - - $ (49,442 ) $ - $ - | |
Disclosure of reconciliation of effective income tax rate [Table Text Block] | Nine months Twelve months (Adjusted - see Note 8) (Restated - see Loss before income taxes $ (3,536,778 ) (1,147,280 ) Expected statutory tax rate 26.5% 26.5% Expected tax recovery resulting from loss (937,246 ) (304,029 ) Increase (reduction) in income taxes resulting from: Non-deductible expenses 275,273 28,115 Unrecognized temporary differences 661,973 275,914 $ - $ - | Nine months Year ended Year ended ended September 30, September 30, September 30, 2022 2021 2020 Loss before income taxes $ (10,569,732 ) $ (9,315,372 ) $ (3,536,778 ) Expected statutory tax rate 26.5% 26.5% 26.5% Expected tax recovery resulting from loss (2,800,979 ) (2,468,574 ) (937,246 ) Increase (reduction) in income taxes resulting from: Non-deductible expenses 563,842 654,956 275,273 Foreign operations subject to different tax rates 5,329 3,593 - Unrecognized temporary differences 2,182,366 1,826,279 661,973 Prior year differences - (16,254 ) - $ (49,442 ) $ - $ - |
Disclosure of research and development expense [Table Text Block] | Year ended Year ended Year ended September 30, September 30, September 30, 2022 2021 2020 R&D expenses $ 2,064,493 $ 2,369,145 $ 944,909 Less: Investment tax credits - (231,007 ) (127,325 ) R&D expenses, net 2,064,493 2,138,138 817,584 | |
Disclosure of deferred taxes [Table Text Block] | Balance at Recognized in Recognized in Balance at Deferred tax assets (liabilities): Net operating loss carryforwards $ - $ 48,045 $ - $ 48,045 Intangible assets - (48,045 ) (48,045 ) $ - $ - $ - $ - | Balance at Arising on a Balance at September 30, business Recognized in September 30, 2021 combination profit or loss 2022 Deferred tax assets (liabilities): Net operating loss carryforwards - - 26,459 26,459 Intangibles and development costs - (49,442 ) 22,983 (26,459 ) - (49,442 ) 49,442 - Balance at Balance at September 30, Recognized in Recognized in September 30, 2020 profit or loss Equity 2021 Deferred tax assets (liabilities): Net operating loss carryforwards 48,045 (48,045 ) - - Impairment provision (48,045 ) 48,045 - - - - - - Balance at Balance at December 31, Recognized in Recognized in September 30, 2019 profit or loss Equity 2020 Deferred tax assets (liabilities): Net operating loss carryforwards - 48,045 - 48,045 Impairment provision - (48,045 ) - (48,045 ) - - - - |
Disclosure of unrecognized net deferred tax assets [Table Text Block] | Balance at Balance at September 30, December 31, 2020 2019 Net operating loss carryforwards $ 4,279,494 $ 2,111,531 Share issuance costs 1,496,239 17,281 Scientific research and development expenditures 218,235 170,940 Other 46,891 22,106 $ 6,040,859 $ 2,321,858 | Balance at Balance at Balance at September 30, September 30, September 30, 2022 2021 2020 Net operating loss carryforwards 18,589,894 9,429,436 4,279,494 Share issuance costs 1,298,783 1,810,927 1,496,239 Intangibles and development costs 608,705 780,607 - Scientific research and development expenditures 1,583,058 1,789,571 218,235 Other 46,300 104,793 46,891 22,126,741 13,915,334 6,040,859 |
Disclosure of net operating losses [Table Text Block] | Year of expiry Amount 2036 $ 512,163 2037 611,677 2038 1,174,797 2039 1,829,518 2040 332,641 $ 4,460,796 | Year of Expiry Amount 2036 $ 512,163 2037 744,022 2038 1,174,797 2039 1,732,039 2040 and thereafter 14,526,720 $ 18,689,741 |
Disclosure of research and development investment tax credits [Table Text Block] | Year of Expiry Amount 2037 $ 13,361 2038 6,742 2039 - 2040 and thereafter 328,480 $ 348,583 |
Financial instruments (Tables)
Financial instruments (Tables) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Sep. 30, 2022 | |
Disclosure of detailed information about financial instruments [abstract] | ||
Disclosure of net US dollar exposure [Table Text Block] | Total USD Assets $ 222,262 Liabilities (88,019 ) Net exposure at September 30, 2020 $ 134,243 Impact to profit or loss if 5% movement in the US dollar $ 6,712 | Total USD Net liabilities in U.S. subsidiary $ 34,623 US denominated: Assets $ 70,187 Liabilities (1,015,090 ) Net U.S. dollar exposure $ (979,526 ) Impact to profit or loss if 5% movement in the U.S. $ (48,976 ) |
Disclosure of contractual obligations [Table Text block] | Payment due: Total Within 1 Year 1 to 3 years 3 to 5 years Accounts payable and accrued liabilities $ 4,459,481 $ 4,459,481 $ - $ - Borrowings 2,648,280 2,548,280 100,000 - Minimum royalty commitments 2,500,000 150,000 350,000 2,000,000 Lease obligations 327,600 93,600 187,200 46,800 Total contractual obligations $ 9,935,361 $ 7,251,361 $ 637,200 $ 2,046,800 |
Supplemental cash flow inform_2
Supplemental cash flow information (Tables) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Sep. 30, 2022 | |
Supplemental Cash Flow Information [Abstract] | ||
Disclosure of non-cash working capital [Table Text Block] | Nine months ended 2020 Twelve months ended (As restated - see Note 25) Trade and other receivables $ (257,588 ) $ (41,465 ) Prepaid expenses and other (387,762 ) (36,629 ) Other assets - (150,000 ) Accounts payable and accrued liabilities 393,202 86,519 Deferred revenue 7,053 - $ (245,095 ) $ (141,575 ) | Year ended Year ended Nine months ended September 30, September 30, September 30, 2022 2021 2020 Trade and other receivables $ 631,801 $ (218,334 ) $ (257,588 ) Inventories 49,446 17,555 - Prepaid expenses and other 425,876 (106,205 ) (387,762 ) Accounts payable and accrued liabilities 2,515,289 (828,698 ) 393,202 Contract liabilities 17,410 (7,053 ) 7,053 Deposits - 150,000 - Accrued royalties liability - 1,191,219 - $ 3,639,822 $ 198,484 $ (245,095 ) |
Segmented information (Tables)
Segmented information (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Disclosure of operating segments [abstract] | |
Disclosure of geographical areas [Table Text Block] | Nine months Twelve months United States $ 835,097 $ 472,749 Canada 26,820 36,399 $ 861,917 $ 509,148 |
Capital management (Tables)
Capital management (Tables) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Sep. 30, 2022 | |
Disclosure Of Capital Management [Abstract] | ||
Disclosure of detailed information about capital management [Table Text Block] | September 30, December 31, (Adjusted - See Note 8) Debt: Related party loans $ 218,276 $ 289,828 Borrowings 32,273 - Lease obligations 352,037 202,686 Convertible notes - 210,819 Equity: Share capital 9,374,563 2,284,353 Contributed surplus 583,878 21,050 Accumulated deficit (6,073,577 ) (2,536,799 ) $ 4,487,450 $ 471,937 | September 30, September 30, 2022 2021 Debt: Borrowings $ 2,278,774 $ 53,251 Lease obligations 275,621 307,909 Equity: Share capital 19,496,640 17,215,068 Warrants 1,959,796 1,848,389 Contributed surplus 3,551,330 2,458,211 Accumulated other comprehensive loss (101,418 ) (8,991 ) Accumulated deficit (25,909,239 ) (15,388,949 ) Total capital $ 1,551,504 $ 6,484,888 |
Commitments and contingencies (
Commitments and contingencies (Tables) | 12 Months Ended |
Sep. 30, 2022 | |
Disclosure Of Commitments And Contingencies [Abstract] | |
Disclosure of performance milestones [Table Text Block] | # of Common Shares Milestones 1,071 $3 million in sales 1,429 $9 million in sales 1,786 $18 million in sales |
Restatement of previously rep_2
Restatement of previously reported audited financial statements (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Restatement Of Previously Reported Audited Financial Statements [Abstract] | |
Disclosure of detailed information about effects of restatement adjustments on consolidated statements of financial position [Table Text Block] | As at As at December 31, 2019 Adjustment December 31, 2019 (Previously Reported) (As restated) Other assets $ - $ 150,000 $ 150,000 Non-current assets $ 254,594 $ 150,000 $ 404,594 Total assets $ 550,087 $ 150,000 $ 700,087 Deficit $ (2,686,799 ) $ 150,000 $ (2,536,799 ) Total shareholders' equity (deficit) $ (381,396 ) $ 150,000 $ (231,396 ) Total liabilities and shareholders' equity (deficit) $ 550,087 $ 150,000 $ 700,087 |
Disclosure of detailed information about effects of restatement adjustments on consolidated statements of net loss and comprehensive loss [Table Text Block] | Year ended Year ended December 31, Adjustment December 31, 2019 (Previously Reported) (As restated) General and administrative expenses $ 547,990 $ (150,000 ) $ 397,990 Total operating expenses $ 1,588,376 $ (150,000 ) $ 1,438,376 Operating loss $ (1,164,329 ) $ 150,000 $ (1,014,329 ) Loss before income taxes $ (1,297,280 ) $ 150,000 $ (1,147,280 ) Net loss and comprehensive loss $ (1,297,280 ) $ 150,000 $ (1,147,280 ) Net loss per share $ (5.21 ) $ 150,000 $ (4.61 ) |
Disclosure of detailed information about effects of restatement adjustments on consolidated statements of cash flows [Table Text Block] | Twelve months Twelve months December 31, 2019 Adjustment December 31, 2019 (Previously Reported) (As restated) Net loss per share $ (1,297,280 ) $ 150,000 $ (1,147,280 ) Changes in non-cash working capital items $ 8,425 $ (150,000 ) $ (141,575 ) |
Subsequent Events (Tables)
Subsequent Events (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Disclosure of non-adjusting events after reporting period [abstract] | |
Disclosure of detailed information about subsequent events [Table Text Block] | Number Amount Outstanding at September 30, 2020 589,518 $ 9,374,563 Issued in brokered private placement 51,087 $ 3,611,818 Issued for exercise of stock options 18,195 $ 1,292,015 Issued for asset acquisition 14,286 $ 1,290,000 Issued in private placement 10,714 $ 1,110,000 Issued for exercise of warrants 10,380 $ 815,307 Issued for exercise of broker compensation options 2,459 $ 347,680 Issued for amended license 1,429 $ 137,000 Issued for debt settlements 1,305 $ 63,866 Issued for share units 138 $ 12,498 Less: share offering costs for the year - $ (839,679 ) Outstanding at September 30, 2021 699,511 $ 17,215,068 |
Corporate information (Narrativ
Corporate information (Narrative) (Details) - $ / shares | 1 Months Ended | 9 Months Ended | 12 Months Ended |
Oct. 28, 2022 | Sep. 30, 2020 | Sep. 30, 2022 | |
Corporate Information [Abstract] | |||
Description of reverse stock split | KWESST effected a one for seventy (1-for-70) reverse stock split of its common stock on October 28, 2022 (the "Reverse Split"). | ||
Conversion rate for each warrant from one common share | $ 0.01428571 | $ 0.01428571 |
Basis of preparation (Narrative
Basis of preparation (Narrative) (Details) | 9 Months Ended | 12 Months Ended | ||||||||
Jun. 12, 2020 CAD ($) share $ / shares shares | Sep. 30, 2020 CAD ($) | Dec. 31, 2022 shares | Sep. 30, 2022 CAD ($) | Sep. 30, 2022 USD ($) | Dec. 31, 2021 shares | Sep. 30, 2021 CAD ($) | Dec. 31, 2020 shares | Dec. 31, 2019 CAD ($) | Jun. 12, 2020 USD ($) share | |
Disclosure of going concern [line items] | ||||||||||
Net loss | $ | $ (3,536,778) | $ (10,520,290) | $ (9,315,372) | $ (1,147,280) | ||||||
Operating cash flows | $ | (1,791,654) | (4,256,596) | (6,255,213) | (1,093,556) | ||||||
Working capital (deficiency) | $ | $ 2,900,000 | (5,409,487) | $ 2,900,000 | $ (300,000) | ||||||
Gross proceeds from public offering | $ 19,200,000 | $ 14,100,000 | ||||||||
SageGuild [Member] | ||||||||||
Disclosure of going concern [line items] | ||||||||||
Consideration transferred, acquisition-date fair value | $ 134,192 | $ 100,000 | ||||||||
Number of common shares issued | share | 7,957 | 7,957 | ||||||||
Implied fair value per share at time of closing | $ / shares | $ 16.8 | |||||||||
Description of arrangement for contingent consideration | management used $0.24 as 1/70 of the underlying stock price for one of the key inputs in the Black-Scholes pricing model. | |||||||||
Number of warrants issued as of acquisition date | shares | 750,000 | |||||||||
Number of common shares available under warrants | shares | 10,714 | |||||||||
Warrants vesting during period | shares | 250,000 | 250,000 | 250,000 | |||||||
Warrants deemed exercised if service condition is met | shares | 250,000 | |||||||||
Aggregate purchase price of warrants | $ | $ 125,000 |
Basis of preparation - Schedule
Basis of preparation - Schedule of interests in subsidiaries (Details) | 12 Months Ended |
Sep. 30, 2022 | |
KWESST Inc. [Member] | |
Disclosure of subsidiaries [line items] | |
Name of subsidiary | KWESST Inc. |
Location | Ottawa, Canada |
Equity % | 100% |
2720178 Ontario Inc. [Member] | |
Disclosure of subsidiaries [line items] | |
Name of subsidiary | 2720178 Ontario Inc. |
Location | Bowmanville, Canada |
Equity % | 100% |
Police Ordnance Company Inc.[Member] | |
Disclosure of subsidiaries [line items] | |
Name of subsidiary | Police Ordnance Company Inc. |
Location | Bowmanville, Canada |
Equity % | 100% |
KWESST U.S. Holdings Inc. [Member] | |
Disclosure of subsidiaries [line items] | |
Name of subsidiary | KWESST U.S. Holdings Inc. |
Location | Delaware, Canada |
Equity % | 100% |
KWESST Defense Systems U.S. Inc. [Member] | |
Disclosure of subsidiaries [line items] | |
Name of subsidiary | KWESST Defense Systems U.S. Inc. |
Location | Virginia, United States |
Equity % | 100% |
KWESST Public Safety Systems U.S. Inc. [Member] | |
Disclosure of subsidiaries [line items] | |
Name of subsidiary | KWESST Public Safety Systems U.S. Inc. |
Location | Virginia, United States |
Equity % | 100% |
KWESST Public Safety Systems Canada Inc. [Member] | |
Disclosure of subsidiaries [line items] | |
Name of subsidiary | KWESST Public Safety Systems Canada Inc. |
Location | Ottawa, Canada |
Equity % | 100% |
Significant accounting polici_4
Significant accounting policies (Narrative) (Details) | 9 Months Ended |
Sep. 30, 2020 | |
Bottom of range [member] | |
Disclosure of detailed information about property, plant and equipment [line items] | |
Lease Term | 3 years |
Top of range [member] | |
Disclosure of detailed information about property, plant and equipment [line items] | |
Lease Term | 6 years |
Significant accounting polici_5
Significant accounting policies - Schedule of estimated useful lives for KWESST's property and equipment (Details) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Sep. 30, 2022 | |
Computer equipment [Member] | ||
Disclosure of detailed information about property, plant and equipment [line items] | ||
Estimated useful lives | 5 years | 3 years |
Computer software [Member] | ||
Disclosure of detailed information about property, plant and equipment [line items] | ||
Estimated useful lives | 3 years | 3 years |
Office furniture and equipment [Member] | ||
Disclosure of detailed information about property, plant and equipment [line items] | ||
Estimated useful lives | 5 years | 5 years |
Low-rate initial production equipment [Member] | ||
Disclosure of detailed information about property, plant and equipment [line items] | ||
Estimated useful lives | 5 years | |
R&D equipment [Member] | ||
Disclosure of detailed information about property, plant and equipment [line items] | ||
Estimated useful lives | 5 years | 5 years |
Sales demo equipment [Member] | ||
Disclosure of detailed information about property, plant and equipment [line items] | ||
Estimated useful lives | 2 years | |
Leasehold improvements [Member] | ||
Disclosure of detailed information about property, plant and equipment [line items] | ||
Estimated useful lives, description | Shorter of useful life or remaining term of lease | Shorter of useful life or remaining term of lease |
Acquisitions (Narrative) (Detai
Acquisitions (Narrative) (Details) | 1 Months Ended | 9 Months Ended | 10 Months Ended | 12 Months Ended | ||||||||||||||
Dec. 15, 2021 CAD ($) share $ / shares shares | Jul. 09, 2020 CAD ($) $ / shares shares | Jun. 12, 2020 CAD ($) share $ / shares shares | Jun. 12, 2020 USD ($) shares | Oct. 28, 2022 | Apr. 29, 2021 CAD ($) share $ / shares shares | Sep. 17, 2020 CAD ($) share shares | May 31, 2020 $ / shares | Sep. 30, 2020 CAD ($) shares | Sep. 30, 2022 CAD ($) shares | Dec. 31, 2022 CAD ($) shares | Sep. 30, 2022 CAD ($) shares | Dec. 31, 2021 CAD ($) shares | Sep. 30, 2021 CAD ($) shares | Dec. 31, 2020 CAD ($) shares | Dec. 31, 2019 CAD ($) shares | Dec. 31, 2018 $ / shares shares | Sep. 30, 2019 shares | |
Disclosure of detailed information about business combination [line items] | ||||||||||||||||||
Description of reverse stock split | 1-for-70 Reverse Split | |||||||||||||||||
Description of outstanding common shares consolidation | Foremost effected a consolidation of its outstanding common shares on the basis of one post-consolidation common share for every 326.9 pre-consolidation common shares. | |||||||||||||||||
Number of shares outstanding | shares | 589,517 | 589,518 | 773,225 | 773,225 | 699,511 | 383,996 | 3 | 383,996 | ||||||||||
Acquisition of technology asset | $ 134,192 | $ 0 | $ 0 | $ 0 | ||||||||||||||
Issue price per share | $ / shares | $ 31.5 | $ 66.67 | ||||||||||||||||
Proceeds from the issuance of common shares | $ 4,355,171 | 344,000 | 6,002,472 | $ 1,014,948 | ||||||||||||||
Police Ordnance [Member] | ||||||||||||||||||
Disclosure of detailed information about business combination [line items] | ||||||||||||||||||
Number of common shares issued | share | 3,965 | |||||||||||||||||
Fair value of common share | $ 377,503 | |||||||||||||||||
Number of warrants issued in acquisition | shares | 200,000 | |||||||||||||||||
Warrants granted, exercise price | $ / shares | $ 1.72 | |||||||||||||||||
Description of warrant conversion | each warrant converts into 0.01428571 common share or 70 warrants to receive one common share of KWESST. | |||||||||||||||||
Contingent shares, Number | shares | 875 | |||||||||||||||||
1/70 of stock price | $ / shares | $ 1.36 | |||||||||||||||||
Risk-free interest rate | 1.04% | |||||||||||||||||
Expected life | 3 years | |||||||||||||||||
Volatility | 84.70% | |||||||||||||||||
Revenue of acquiree since acquisition date | $ 355,296 | 846,600 | ||||||||||||||||
Profit (loss) of acquiree since acquisition date | (198,353) | 31,000 | ||||||||||||||||
DEFSEC [Member] | ||||||||||||||||||
Disclosure of detailed information about business combination [line items] | ||||||||||||||||||
Number of common shares issued | share | 14,286 | |||||||||||||||||
Fair value of common share | $ 1,290,000 | |||||||||||||||||
Number of warrants issued in acquisition | shares | 500,000 | |||||||||||||||||
Warrants granted, exercise price | $ / shares | $ 0.7 | |||||||||||||||||
Percentage of warrants vesting per anniversary | 25% | |||||||||||||||||
Percentage of royalty on annual sales | 7% | |||||||||||||||||
Maximum royalty on annual sales | $ 10,000,000 | |||||||||||||||||
Payment of advance royalty | $ 150,000 | |||||||||||||||||
1/70 of stock price | $ / shares | $ 1.29 | |||||||||||||||||
Risk-free interest rate | 0.48% | |||||||||||||||||
Expected life | 3 years | |||||||||||||||||
Volatility | 80% | |||||||||||||||||
Discount rate for minimum royalty payments | 13.70% | |||||||||||||||||
Accretion cost relating to discounted minimum royalty payments | 159,451 | 64,537 | ||||||||||||||||
Accrued royalties liability | $ 1,265,207 | $ 1,265,207 | $ 1,105,756 | |||||||||||||||
KWESST Inc. [Member] | ||||||||||||||||||
Disclosure of detailed information about business combination [line items] | ||||||||||||||||||
Number of shares outstanding | shares | 576,681 | |||||||||||||||||
Percentage of outstanding shares | 97.80% | |||||||||||||||||
Issued common shares | shares | 62,994 | |||||||||||||||||
Issue price per share | $ / shares | $ 49 | |||||||||||||||||
Proceeds from the issuance of common shares | $ 3,100,000 | |||||||||||||||||
Foremost [Member] | ||||||||||||||||||
Disclosure of detailed information about business combination [line items] | ||||||||||||||||||
Number of shares outstanding | shares | 12,836 | |||||||||||||||||
Number of common shares issued | share | 12,836 | |||||||||||||||||
Non-cash listing expense (included in M&A costs) | $ 814,703 | |||||||||||||||||
Fair value of common share | $ 628,949 | |||||||||||||||||
Two M&A / capital market advisors [Member] | ||||||||||||||||||
Disclosure of detailed information about business combination [line items] | ||||||||||||||||||
Number of common shares issued | share | 14,286 | |||||||||||||||||
Fair value of common share | $ 700,000 | |||||||||||||||||
SageGuild LLC [Member] | ||||||||||||||||||
Disclosure of detailed information about business combination [line items] | ||||||||||||||||||
Acquisition of technology asset | $ 134,192 | $ 100,000 | ||||||||||||||||
Number of common shares issued | share | 2,000 | |||||||||||||||||
Issued common shares | shares | 7,957 | 7,957 | ||||||||||||||||
Issue price per share | $ / shares | $ 35 | |||||||||||||||||
Fair value of common share | $ 278,500 | |||||||||||||||||
Annual payments | $ 125,000 | $ 125,000 | $ 125,000 | |||||||||||||||
Number of warrants issued in acquisition | shares | 750,000 | |||||||||||||||||
Warrants granted, exercise price | $ / shares | $ 0.5 | |||||||||||||||||
Warrants vesting during period | shares | 250,000 | 250,000 | 250,000 | |||||||||||||||
Description of royalty agreement | In addition to the above total purchase consideration, KWESST Inc. has agreed to pay SageGuild royalties at a rate of 20% on amounts received in consideration of the grant of licenses and on sales of the GhostStep® Technology until KWESST has paid SageGuild a total of USD $3 million in royalties. Once KWESST has paid SageGuild a total of USD $3 million in royalties, the royalty rate will decrease to 5%. The obligation to pay royalties will terminate automatically once KWESST has paid SageGuild a total of USD $20 million in royalties. | In addition to the above total purchase consideration, KWESST Inc. has agreed to pay SageGuild royalties at a rate of 20% on amounts received in consideration of the grant of licenses and on sales of the GhostStep® Technology until KWESST has paid SageGuild a total of USD $3 million in royalties. Once KWESST has paid SageGuild a total of USD $3 million in royalties, the royalty rate will decrease to 5%. The obligation to pay royalties will terminate automatically once KWESST has paid SageGuild a total of USD $20 million in royalties. |
Acquisitions - Schedule of purc
Acquisitions - Schedule of purchase consideration (Details) | 9 Months Ended | 12 Months Ended | ||||||
Jun. 12, 2020 CAD ($) share shares | Jun. 12, 2020 USD ($) | Sep. 30, 2020 CAD ($) | Sep. 30, 2022 CAD ($) | Sep. 30, 2021 CAD ($) | Dec. 31, 2019 CAD ($) | Dec. 15, 2021 CAD ($) share shares | Apr. 29, 2021 CAD ($) share shares | |
Disclosure of detailed information about business combination [line items] | ||||||||
Cash consideration | $ 134,192 | $ 0 | $ 0 | $ 0 | ||||
Police Ordnance [Member] | ||||||||
Disclosure of detailed information about business combination [line items] | ||||||||
Common shares, Number | share | 3,965 | |||||||
Common shares, Fair Value | $ 377,503 | |||||||
Warrants, Number | shares | 200,000 | |||||||
Warrants, Fair Value | $ 132,000 | |||||||
Contingent shares, Number | shares | 875 | |||||||
Contingent consideration | $ 83,319 | |||||||
Total fair value consideration | $ 592,822 | |||||||
DEFSEC [Member] | ||||||||
Disclosure of detailed information about business combination [line items] | ||||||||
Common shares, Number | share | 14,286 | |||||||
Common shares, Fair Value | $ 1,290,000 | |||||||
Warrants, Number | shares | 500,000 | |||||||
Warrants, Fair Value | $ 425,000 | |||||||
Minimum royalty payments, Fair Value | 1,191,219 | |||||||
Total purchase consideration | 2,906,219 | |||||||
Identifiable intangible assets | ||||||||
Technology asset | $ 2,906,219 | |||||||
SageGuild LLC [Member] | ||||||||
Disclosure of detailed information about business combination [line items] | ||||||||
Common shares, Number | share | 2,000 | |||||||
Common shares, Fair Value | $ 278,500 | |||||||
Warrants, Number | shares | 750,000 | |||||||
Cash consideration | $ 134,192 | $ 100,000 | ||||||
Share issuance with no condition | 33,600 | |||||||
Elected share issuances | 133,680 | |||||||
Contingent consideration | 180,000 | |||||||
Total purchase consideration | $ 481,472 |
Acquisitions - Schedule of fair
Acquisitions - Schedule of fair value of the net assets acquired and total consideration transferred (Details) - Foremost [Member] | 1 Months Ended |
Sep. 17, 2020 CAD ($) share $ / shares | |
Disclosure of detailed information about business combination [line items] | |
Number of common shares issued | share | 12,836 |
KWESST's stock price at closing of reverse acquisition | $ / shares | $ 49 |
Common shares, Fair Value | $ 628,949 |
Options | 41,155 |
Total fair value consideration | $ 670,104 |
Acquisitions - Schedule of net
Acquisitions - Schedule of net cash inflow as at closing of acquisition (Details) - Police Ordnance [Member] | Dec. 15, 2021 CAD ($) |
Disclosure of detailed information about business combination [line items] | |
Cash assumed on acquisition | $ 162,547 |
less: consideration paid in cash | 0 |
Net cash inflow on acquisition | $ 162,547 |
Acquisitions - Schedule of tota
Acquisitions - Schedule of total fair value consideration (Details) - CAD ($) | 1 Months Ended | |
Sep. 17, 2020 | Dec. 15, 2021 | |
Police Ordnance [Member] | ||
Disclosure of detailed information about business combination [line items] | ||
Total fair value consideration | $ 592,822 | |
Foremost's net assets (liabilities): | ||
Cash | 162,547 | |
Trade and other receivables | 104,432 | |
Inventories | 352,685 | |
Intangible assets: | ||
Purchase orders | 100,000 | |
Customer relationships | 50,000 | |
ARWEN tradename | 44,000 | |
Accounts payable and accrued liabilities | 82,963 | |
Corporate tax liability | 32,338 | |
Contract liabilities | 29,861 | |
Borrowings | 26,238 | |
Deferred tax liabilities | 49,442 | |
Total | $ 592,822 | |
Foremost Ventures Corp [Member] | ||
Disclosure of detailed information about business combination [line items] | ||
Total fair value consideration | $ 670,104 | |
Foremost's net assets (liabilities): | ||
Cash | 78,589 | |
Trade and other receivables | 1,900 | |
Intangible assets: | ||
Accounts payable and accrued liabilities | (225,088) | |
Net assets (liabilities) at fair value | (144,599) | |
Residual balance allocated to listing expense (included in M&A costs) | 814,703 | |
Total | $ 670,104 |
Acquisitions - Schedule of mini
Acquisitions - Schedule of minimum annual royalty payments (Details) - DEFSEC [Member] | Apr. 29, 2021 CAD ($) |
Disclosure of detailed information about business combination [line items] | |
Minimum annual royalty payments | $ 2,500,000 |
April 29 2023 [Member] | |
Disclosure of detailed information about business combination [line items] | |
Minimum annual royalty payments | 150,000 |
April 29 2024 [Member] | |
Disclosure of detailed information about business combination [line items] | |
Minimum annual royalty payments | 150,000 |
April 29 2025 [Member] | |
Disclosure of detailed information about business combination [line items] | |
Minimum annual royalty payments | 200,000 |
April 29 2026 [Member] | |
Disclosure of detailed information about business combination [line items] | |
Minimum annual royalty payments | 200,000 |
April 29 2027 [Member] | |
Disclosure of detailed information about business combination [line items] | |
Minimum annual royalty payments | 250,000 |
April 29 2028 [Member] | |
Disclosure of detailed information about business combination [line items] | |
Minimum annual royalty payments | 250,000 |
April 29 2029 [Member] | |
Disclosure of detailed information about business combination [line items] | |
Minimum annual royalty payments | 300,000 |
April 29 2030 [Member] | |
Disclosure of detailed information about business combination [line items] | |
Minimum annual royalty payments | 300,000 |
April 29 2031 [Member] | |
Disclosure of detailed information about business combination [line items] | |
Minimum annual royalty payments | 350,000 |
April 29 2032 [Member] | |
Disclosure of detailed information about business combination [line items] | |
Minimum annual royalty payments | $ 350,000 |
Trade and other receivables (Na
Trade and other receivables (Narrative) (Details) - CAD ($) | 12 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Trade and other receivables [abstract] | ||
Impairment of trade and other receivables | $ 0 | $ 0 |
Trade and other receivables - S
Trade and other receivables - Schedule of trade and other receivables (Details) - CAD ($) | Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2019 |
Trade and other receivables [abstract] | ||||
Trade receivables | $ 114,877 | $ 0 | $ 210,795 | $ 1,191 |
Unbilled revenue | 8,881 | 308,728 | 0 | |
Sales tax recoverable | 48,124 | 183,761 | 142,797 | 55,684 |
Investment tax credits refundable | 0 | 206,762 | 127,325 | 162,928 |
Total | $ 171,882 | $ 699,251 | $ 480,917 | $ 219,803 |
Trade and other receivables -_2
Trade and other receivables - Schedule of unbilled trade and other receivables (Details) - CAD ($) | 12 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Trade and other receivables [abstract] | ||
Balance, beginning of year | $ 308,728 | $ 0 |
Unbilled Receivables, decrease from revenue billed | (308,728) | |
Revenue in excess of billings, net of amounts transferred to trade accounts receivable | 8,881 | 308,728 |
Amounts written off | 0 | 0 |
Balance, end of year | 8,881 | 308,728 |
Current | 8,881 | 308,728 |
Non-current | $ 0 | $ 0 |
Inventories (Narrative) (Detail
Inventories (Narrative) (Details) - CAD ($) | 12 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Disclosure Of Inventories [Abstract] | ||
Impairment of inventories | $ 0 | $ 0 |
Inventories - Schedule of inven
Inventories - Schedule of inventories (Details) - CAD ($) | Sep. 30, 2022 | Sep. 30, 2021 |
Disclosure Of Inventories [Abstract] | ||
Finished goods | $ 49,643 | $ 0 |
Work-in-progress | 21,350 | 0 |
Raw materials | 322,545 | 90,299 |
Total | $ 393,538 | $ 90,299 |
Property and equipment - Schedu
Property and equipment - Schedule of changes in property and equipment (Details) - CAD ($) | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2019 | |
Disclosure of detailed information about property, plant and equipment [line items] | ||||
Opening balance | $ 70,122 | $ 903,649 | $ 174,644 | |
Ending balance | 174,644 | 832,481 | 903,649 | $ 70,122 |
Cost [Member] | ||||
Disclosure of detailed information about property, plant and equipment [line items] | ||||
Opening balance | 110,194 | 1,033,676 | 235,517 | 90,004 |
Additions | 133,930 | 187,478 | 813,792 | 20,190 |
Disposals | (8,607) | (3,800) | (15,633) | 0 |
Ending balance | 235,517 | 1,217,354 | 1,033,676 | 110,194 |
Accumulated depreciation [Member] | ||||
Disclosure of detailed information about property, plant and equipment [line items] | ||||
Opening balance | (40,072) | (130,027) | (60,873) | (20,737) |
Depreciation for the year | 29,408 | 257,481 | 79,628 | 19,335 |
Disposals | (8,607) | (2,635) | (10,474) | |
Ending balance | (60,873) | (384,873) | (130,027) | (40,072) |
Computer equipment [Member] | ||||
Disclosure of detailed information about property, plant and equipment [line items] | ||||
Opening balance | 13,832 | 41,359 | 26,745 | |
Ending balance | 26,745 | 64,281 | 41,359 | 13,832 |
Computer equipment [Member] | Cost [Member] | ||||
Disclosure of detailed information about property, plant and equipment [line items] | ||||
Opening balance | 14,073 | 59,757 | 32,807 | 0 |
Additions | 18,734 | 50,849 | 30,778 | 14,073 |
Disposals | 0 | (3,800) | (3,828) | 0 |
Ending balance | 32,807 | 106,806 | 59,757 | 14,073 |
Computer equipment [Member] | Accumulated depreciation [Member] | ||||
Disclosure of detailed information about property, plant and equipment [line items] | ||||
Opening balance | (241) | (18,398) | (6,062) | 0 |
Depreciation for the year | 5,821 | 26,762 | 13,966 | 241 |
Disposals | 0 | (2,635) | (1,630) | |
Ending balance | (6,062) | (42,525) | (18,398) | (241) |
Computer software [Member] | ||||
Disclosure of detailed information about property, plant and equipment [line items] | ||||
Opening balance | 2,034 | 0 | 508 | |
Ending balance | 508 | 3,875 | 0 | 2,034 |
Computer software [Member] | Cost [Member] | ||||
Disclosure of detailed information about property, plant and equipment [line items] | ||||
Opening balance | 8,145 | 0 | 8,145 | 8,145 |
Additions | 0 | 5,129 | 0 | 0 |
Disposals | 0 | 0 | (8,145) | 0 |
Ending balance | 8,145 | 5,129 | 0 | 8,145 |
Computer software [Member] | Accumulated depreciation [Member] | ||||
Disclosure of detailed information about property, plant and equipment [line items] | ||||
Opening balance | (6,111) | 0 | (7,637) | (3,396) |
Depreciation for the year | 1,526 | 1,254 | 508 | 2,715 |
Disposals | 0 | 0 | (8,145) | |
Ending balance | (7,637) | (1,254) | 0 | (6,111) |
Office furniture and equipment [Member] | ||||
Disclosure of detailed information about property, plant and equipment [line items] | ||||
Opening balance | 16,638 | 49,752 | 59,549 | |
Ending balance | 59,549 | 41,502 | 49,752 | 16,638 |
Office furniture and equipment [Member] | Cost [Member] | ||||
Disclosure of detailed information about property, plant and equipment [line items] | ||||
Opening balance | 32,781 | 90,116 | 81,841 | 31,873 |
Additions | 49,060 | 10,817 | 11,211 | 908 |
Disposals | 0 | 0 | (2,936) | 0 |
Ending balance | 81,841 | 100,933 | 90,116 | 32,781 |
Office furniture and equipment [Member] | Accumulated depreciation [Member] | ||||
Disclosure of detailed information about property, plant and equipment [line items] | ||||
Opening balance | (16,143) | (40,364) | (22,292) | (9,587) |
Depreciation for the year | 6,149 | 19,067 | 18,759 | 6,556 |
Disposals | 0 | 0 | (687) | |
Ending balance | (22,292) | (59,431) | (40,364) | (16,143) |
LRIP equipment [Member] | Cost [Member] | ||||
Disclosure of detailed information about property, plant and equipment [line items] | ||||
Opening balance | 0 | 0 | ||
Additions | 77,559 | 0 | ||
Disposals | 0 | 0 | ||
Ending balance | 0 | 77,559 | 0 | |
Moulding equipment [Member] | ||||
Disclosure of detailed information about property, plant and equipment [line items] | ||||
Opening balance | 49,752 | |||
Ending balance | 70,557 | 49,752 | ||
Moulding equipment [Member] | Cost [Member] | ||||
Disclosure of detailed information about property, plant and equipment [line items] | ||||
Opening balance | 0 | 0 | ||
Depreciation for the year | 7,002 | 0 | ||
Disposals | 0 | 0 | ||
Ending balance | 0 | (7,002) | 0 | |
R&D equipment [Member] | ||||
Disclosure of detailed information about property, plant and equipment [line items] | ||||
Opening balance | 33,229 | 179,653 | 32,797 | |
Ending balance | 32,797 | 155,298 | 179,653 | 33,229 |
R&D equipment [Member] | Cost [Member] | ||||
Disclosure of detailed information about property, plant and equipment [line items] | ||||
Opening balance | 46,588 | 217,940 | 53,634 | 41,379 |
Additions | 7,046 | 21,864 | 165,030 | 5,209 |
Disposals | 0 | 0 | (724) | 0 |
Ending balance | 53,634 | 239,804 | 217,940 | 46,588 |
R&D equipment [Member] | Accumulated depreciation [Member] | ||||
Disclosure of detailed information about property, plant and equipment [line items] | ||||
Opening balance | (13,359) | (38,287) | (20,837) | (5,257) |
Depreciation for the year | 7,478 | 46,219 | 17,462 | 8,102 |
Disposals | 0 | 0 | (12) | |
Ending balance | (20,837) | (84,506) | (38,287) | (13,359) |
Leasehold improvements [Member] | ||||
Disclosure of detailed information about property, plant and equipment [line items] | ||||
Opening balance | 4,389 | 100,703 | 55,045 | |
Ending balance | 55,045 | 92,588 | 100,703 | 4,389 |
Leasehold improvements [Member] | Cost [Member] | ||||
Disclosure of detailed information about property, plant and equipment [line items] | ||||
Opening balance | 8,607 | 117,237 | 59,090 | 8,607 |
Additions | 59,090 | 19,800 | 58,147 | 0 |
Disposals | (8,607) | 0 | 0 | 0 |
Ending balance | 59,090 | 137,037 | 117,237 | 8,607 |
Leasehold improvements [Member] | Accumulated depreciation [Member] | ||||
Disclosure of detailed information about property, plant and equipment [line items] | ||||
Opening balance | (4,218) | (16,534) | (4,045) | (2,497) |
Depreciation for the year | 8,434 | 27,915 | 12,489 | 1,721 |
Disposals | (8,607) | 0 | 0 | |
Ending balance | (4,045) | (44,449) | (16,534) | $ (4,218) |
Sales demo equipment [Member] | ||||
Disclosure of detailed information about property, plant and equipment [line items] | ||||
Opening balance | 532,182 | |||
Ending balance | 404,380 | 532,182 | ||
Sales demo equipment [Member] | Cost [Member] | ||||
Disclosure of detailed information about property, plant and equipment [line items] | ||||
Opening balance | 548,626 | 0 | ||
Additions | 1,460 | 548,626 | ||
Disposals | 0 | 0 | ||
Ending balance | 0 | 550,086 | 548,626 | |
Sales demo equipment [Member] | Accumulated depreciation [Member] | ||||
Disclosure of detailed information about property, plant and equipment [line items] | ||||
Opening balance | (16,444) | 0 | ||
Depreciation for the year | 129,262 | 16,444 | ||
Disposals | 0 | 0 | ||
Ending balance | $ 0 | $ (145,706) | $ (16,444) |
Right-of-use assets (Narrative)
Right-of-use assets (Narrative) (Details) - CAD ($) | Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2019 |
Disclosure of quantitative information about right-of-use assets [line items] | ||||
Deposits | $ 23,604 | $ 21,367 | $ 19,341 | $ 0 |
New Office Lease [Member] | ||||
Disclosure of quantitative information about right-of-use assets [line items] | ||||
Deposits | $ 33,726 | $ 33,726 |
Right-of-use assets - Schedule
Right-of-use assets - Schedule of right-of-use assets (Details) - CAD ($) | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2019 | |
Disclosure of quantitative information about right-of-use assets [line items] | ||||
Balance, Beginning | $ 184,472 | $ 266,214 | $ 327,576 | $ 267,279 |
Additions | 571,604 | |||
Termination | (139,787) | |||
Depreciation | (95,849) | (58,083) | (61,362) | (82,807) |
Balance, Ending | 327,576 | 208,131 | 266,214 | 184,472 |
As previously reported [Member] | ||||
Disclosure of quantitative information about right-of-use assets [line items] | ||||
Balance, Beginning | 520,440 | |||
Balance, Ending | 520,440 | |||
Correction of an error [Member] | ||||
Disclosure of quantitative information about right-of-use assets [line items] | ||||
Balance, Beginning | (192,864) | |||
Balance, Ending | (192,864) | |||
Offices [Member] | ||||
Disclosure of quantitative information about right-of-use assets [line items] | ||||
Balance, Beginning | 177,911 | 266,214 | 324,297 | 254,159 |
Additions | 571,604 | |||
Termination | (139,787) | |||
Depreciation | (92,567) | (58,083) | (58,083) | (76,248) |
Balance, Ending | 324,297 | 208,131 | 266,214 | 177,911 |
Offices [Member] | As previously reported [Member] | ||||
Disclosure of quantitative information about right-of-use assets [line items] | ||||
Balance, Beginning | 517,161 | |||
Balance, Ending | 517,161 | |||
Offices [Member] | Correction of an error [Member] | ||||
Disclosure of quantitative information about right-of-use assets [line items] | ||||
Balance, Beginning | (192,864) | |||
Balance, Ending | (192,864) | |||
Printer [Member] | ||||
Disclosure of quantitative information about right-of-use assets [line items] | ||||
Balance, Beginning | 6,561 | 0 | 3,279 | 13,120 |
Additions | 0 | |||
Termination | 0 | |||
Depreciation | (3,282) | 0 | (3,279) | (6,559) |
Balance, Ending | 3,279 | $ 0 | 0 | $ 6,561 |
Printer [Member] | As previously reported [Member] | ||||
Disclosure of quantitative information about right-of-use assets [line items] | ||||
Balance, Beginning | 3,279 | |||
Balance, Ending | 3,279 | |||
Printer [Member] | Correction of an error [Member] | ||||
Disclosure of quantitative information about right-of-use assets [line items] | ||||
Balance, Beginning | $ 0 | |||
Balance, Ending | $ 0 |
Right-of-use assets - Schedul_2
Right-of-use assets - Schedule of consolidated statements of financial position (Details) - CAD ($) | Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
Disclosure of quantitative information about right-of-use assets [line items] | |||||
Trade and other receivables | $ 171,882 | $ 699,251 | $ 480,917 | $ 219,803 | |
Right-of-assets | 208,131 | 266,214 | 327,576 | 184,472 | $ 267,279 |
Deposit (non-current) | 23,604 | 21,367 | 19,341 | 0 | |
Total assets | 7,323,463 | 8,717,846 | 5,312,777 | 700,087 | |
Lease obligations (current) | 69,150 | 32,288 | 44,128 | 85,468 | 77,367 |
Lease obligations (non-current) | 206,471 | 275,621 | 307,909 | 117,218 | $ 202,686 |
Total liabilities | 8,326,354 | 2,594,118 | 1,427,913 | 931,483 | |
Deficit | $ (25,909,239) | $ (15,388,949) | (6,073,577) | (2,536,799) | |
As previously reported [Member] | |||||
Disclosure of quantitative information about right-of-use assets [line items] | |||||
Trade and other receivables | 479,291 | ||||
Right-of-assets | 520,440 | ||||
Deposit (non-current) | 22,337 | ||||
Total assets | 5,507,011 | 550,087 | |||
Lease obligations (current) | 78,358 | ||||
Lease obligations (non-current) | 496,394 | ||||
Total liabilities | 1,650,628 | ||||
Deficit | (6,102,058) | (2,686,799) | |||
Adjustment [Member] | |||||
Disclosure of quantitative information about right-of-use assets [line items] | |||||
Trade and other receivables | 1,626 | ||||
Right-of-assets | (192,864) | ||||
Deposit (non-current) | (2,996) | ||||
Total assets | (194,234) | 150,000 | |||
Lease obligations (current) | (34,230) | ||||
Lease obligations (non-current) | (188,485) | ||||
Total liabilities | (222,715) | ||||
Deficit | $ 28,481 | $ 150,000 |
Right-of-use assets - Schedul_3
Right-of-use assets - Schedule of consolidated statements of changes in shareholders' equity (deficit) (Details) - CAD ($) | Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
Disclosure of quantitative information about right-of-use assets [line items] | |||||
Deficit | $ (25,909,239) | $ (15,388,949) | $ (6,073,577) | $ (2,536,799) | |
Total shareholders' equity (deficit) | $ (1,002,891) | $ 6,123,728 | 3,884,864 | (231,396) | $ (1,389,319) |
As previously reported [Member] | |||||
Disclosure of quantitative information about right-of-use assets [line items] | |||||
Deficit | (6,102,058) | (2,686,799) | |||
Total shareholders' equity (deficit) | 3,856,383 | (381,396) | |||
Adjustment [Member] | |||||
Disclosure of quantitative information about right-of-use assets [line items] | |||||
Deficit | 28,481 | 150,000 | |||
Total shareholders' equity (deficit) | $ 28,481 | $ 150,000 |
Intangible assets (Narrative) (
Intangible assets (Narrative) (Details) - CAD ($) | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2022 | Sep. 30, 2021 | |
Disclosure of detailed information about intangible assets [line items] | |||
Additions | $ 163,230 | $ 1,176,664 | $ 83,228 |
Additions through acquisition | 481,472 | 194,000 | 2,906,219 |
Amortization charge | 10,927 | ||
Recognition of open orders | (87,802) | ||
Development costs [Member] | |||
Disclosure of detailed information about intangible assets [line items] | |||
Additions | 163,230 | ||
Additions through acquisition | 0 | ||
Technology-based intangible assets [member] | |||
Disclosure of detailed information about intangible assets [line items] | |||
Additions | 0 | ||
Additions through acquisition | $ 481,472 | ||
Useful life | 5 years | ||
Phantom System [Member] | |||
Disclosure of detailed information about intangible assets [line items] | |||
Additions | 584,885 | 83,228 | |
Additions through acquisition | 0 | 0 | |
Amortization charge | $ 0 | 0 | |
Useful life | 5 years | ||
Recognition of open orders | $ 0 | ||
PARA OPS System [Member] | |||
Disclosure of detailed information about intangible assets [line items] | |||
Additions | 562,996 | 0 | |
Additions through acquisition | 0 | 2,906,219 | |
Amortization charge | $ 0 | 0 | |
Useful life | 5 years | ||
Recognition of open orders | $ 0 | ||
PARA OPS Patent [Member] | |||
Disclosure of detailed information about intangible assets [line items] | |||
Additions | 28,783 | 0 | |
Additions through acquisition | 0 | 0 | |
Amortization charge | 0 | 0 | |
Recognition of open orders | 0 | ||
Purchase Orders [Member] | |||
Disclosure of detailed information about intangible assets [line items] | |||
Additions | 0 | 0 | |
Additions through acquisition | 100,000 | 0 | |
Amortization charge | 0 | ||
Recognition of open orders | (87,802) | ||
ARWEN Tradename [Member] | |||
Disclosure of detailed information about intangible assets [line items] | |||
Additions | 0 | 0 | |
Additions through acquisition | 44,000 | 0 | |
Amortization charge | $ 6,968 | ||
Useful life | 5 years | ||
Recognition of open orders | $ 0 | ||
Customer Relationships [Member] | |||
Disclosure of detailed information about intangible assets [line items] | |||
Additions | 0 | 0 | |
Additions through acquisition | 50,000 | $ 0 | |
Amortization charge | $ 3,959 | ||
Useful life | 10 years | ||
Recognition of open orders | $ 0 |
Intangible assets - Schedule of
Intangible assets - Schedule of intangible assets (Details) - CAD ($) | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2022 | Sep. 30, 2021 | |
Disclosure of detailed information about intangible assets [line items] | |||
Beginning balance | $ 0 | $ 3,470,919 | $ 644,702 |
Additions | 163,230 | 1,176,664 | 83,228 |
Acquisition | 481,472 | 194,000 | 2,906,219 |
Transferred to cost of sales | (107,854) | ||
Amortization | (10,927) | ||
Recognition of open orders | (87,802) | ||
Impairment charge | (55,376) | ||
Ending balance | 644,702 | 4,742,854 | 3,470,919 |
TASCS System [Member] | |||
Disclosure of detailed information about intangible assets [line items] | |||
Beginning balance | 0 | 163,230 | |
Additions | 0 | 0 | |
Acquisition | 0 | 0 | |
Transferred to cost of sales | (107,854) | ||
Amortization | 0 | ||
Recognition of open orders | 0 | ||
Impairment charge | (55,376) | ||
Ending balance | 163,230 | 0 | 0 |
Phantom System [Member] | |||
Disclosure of detailed information about intangible assets [line items] | |||
Beginning balance | 564,700 | 481,472 | |
Additions | 584,885 | 83,228 | |
Acquisition | 0 | 0 | |
Transferred to cost of sales | 0 | ||
Amortization | 0 | 0 | |
Recognition of open orders | 0 | ||
Impairment charge | 0 | ||
Ending balance | 481,472 | 1,149,585 | 564,700 |
PARA OPS System [Member] | |||
Disclosure of detailed information about intangible assets [line items] | |||
Beginning balance | 2,906,219 | 0 | |
Additions | 562,996 | 0 | |
Acquisition | 0 | 2,906,219 | |
Transferred to cost of sales | 0 | ||
Amortization | 0 | 0 | |
Recognition of open orders | 0 | ||
Impairment charge | 0 | ||
Ending balance | 0 | 3,469,215 | 2,906,219 |
PARA OPS Patent [Member] | |||
Disclosure of detailed information about intangible assets [line items] | |||
Beginning balance | 0 | 0 | |
Additions | 28,783 | 0 | |
Acquisition | 0 | 0 | |
Transferred to cost of sales | 0 | ||
Amortization | 0 | 0 | |
Recognition of open orders | 0 | ||
Impairment charge | 0 | ||
Ending balance | 0 | 28,783 | 0 |
ARWEN Tradename [Member] | |||
Disclosure of detailed information about intangible assets [line items] | |||
Beginning balance | 0 | 0 | |
Additions | 0 | 0 | |
Acquisition | 44,000 | 0 | |
Transferred to cost of sales | 0 | ||
Amortization | (6,968) | ||
Recognition of open orders | 0 | ||
Impairment charge | 0 | ||
Ending balance | 0 | 37,032 | 0 |
Customer Relationships [Member] | |||
Disclosure of detailed information about intangible assets [line items] | |||
Beginning balance | 0 | 0 | |
Additions | 0 | 0 | |
Acquisition | 50,000 | 0 | |
Transferred to cost of sales | 0 | ||
Amortization | (3,959) | ||
Recognition of open orders | 0 | ||
Impairment charge | 0 | ||
Ending balance | 0 | 46,041 | 0 |
Purchase Orders [Member] | |||
Disclosure of detailed information about intangible assets [line items] | |||
Beginning balance | 0 | 0 | |
Additions | 0 | 0 | |
Acquisition | 100,000 | 0 | |
Transferred to cost of sales | 0 | ||
Amortization | 0 | ||
Recognition of open orders | (87,802) | ||
Impairment charge | 0 | ||
Ending balance | 0 | $ 12,198 | 0 |
Development Costs [Member] | |||
Disclosure of detailed information about intangible assets [line items] | |||
Beginning balance | 0 | 163,230 | |
Additions | 163,230 | ||
Acquisition | 0 | ||
Ending balance | 163,230 | ||
Technology assets [Member] | |||
Disclosure of detailed information about intangible assets [line items] | |||
Beginning balance | 0 | $ 481,472 | |
Additions | 0 | ||
Acquisition | 481,472 | ||
Ending balance | $ 481,472 |
Accounts payable and accrued _3
Accounts payable and accrued liabilities - Schedule of accounts payable and accrued liabilities (Details) - CAD ($) | Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2019 |
Trade and other current payables [abstract] | ||||
Trade payable | $ 2,292,954 | $ 620,041 | $ 493,027 | $ 126,481 |
Accrued liabilities | 1,045,409 | 384,239 | 188,265 | 29,822 |
Salary, bonus and vacation payable | 1,116,203 | 122,230 | 65,722 | 29,343 |
Interest payable | 4,915 | 0 | ||
Payroll taxes payable | 0 | 692 | 67,229 | 0 |
Other | 4,031 | 13,041 | ||
Total | $ 4,459,481 | $ 1,127,202 | $ 818,274 | $ 198,687 |
Related party transactions (Nar
Related party transactions (Narrative) (Details) | 1 Months Ended | 9 Months Ended | 12 Months Ended | |||||||||||||||
Oct. 28, 2022 | Jul. 31, 2022 CAD ($) shares | Apr. 30, 2021 CAD ($) shares | Sep. 30, 2020 CAD ($) shares | Sep. 30, 2022 CAD ($) shares | Sep. 30, 2021 CAD ($) shares | Dec. 31, 2019 CAD ($) shares | Aug. 31, 2022 CAD ($) | Mar. 31, 2022 CAD ($) shares | Aug. 31, 2021 shares | Aug. 31, 2020 shares | Oct. 23, 2019 CAD ($) | Sep. 30, 2019 shares | Dec. 31, 2018 CAD ($) shares | Dec. 14, 2018 CAD ($) | Jun. 05, 2018 CAD ($) | Jun. 05, 2018 USD ($) | Apr. 20, 2018 CAD ($) | |
Disclosure of transactions between related parties [line items] | ||||||||||||||||||
Description of reverse stock split | 1-for-70 Reverse Split | |||||||||||||||||
Principal amount | $ 32,273 | $ 2,278,774 | $ 53,251 | $ 0 | ||||||||||||||
Interest expense | $ 90,474 | $ 511,990 | $ 116,113 | |||||||||||||||
Number of warrants outstanding | shares | 9,585,050 | 13,417,156 | 13,901,640 | 8,500,000 | 13,901,640 | 9,585,050 | 8,500,000 | 0 | ||||||||||
Amounts payable, related party transactions | $ 218,276 | $ 0 | $ 289,828 | $ 885,213 | ||||||||||||||
Cash and share-based remuneration amount | 335,728 | $ 2,101,267 | 1,680,968 | 78,343 | ||||||||||||||
Total consideration | $ 24,959 | $ 860,400 | $ 988,716 | 0 | ||||||||||||||
Key management personnel of KWESST [Member] | ||||||||||||||||||
Disclosure of transactions between related parties [line items] | ||||||||||||||||||
Percentage of issued and outstanding common shares | 38% | 28.30% | 31.50% | |||||||||||||||
Prior year expenses payment | $ 15,000 | |||||||||||||||||
Interest expense | $ 6,585 | |||||||||||||||||
Number of warrants outstanding | shares | 1,500,000 | |||||||||||||||||
Number of options outstanding | shares | 2,857 | |||||||||||||||||
Cash and share-based remuneration amount | $ 494,325 | |||||||||||||||||
Loans from CEO [Member] | ||||||||||||||||||
Disclosure of transactions between related parties [line items] | ||||||||||||||||||
Annual interest rate | The loans are due on demand and accrue annual interest at TD Bank prime plus 1.55% | |||||||||||||||||
Borrowings, interest rate | 1.55% | |||||||||||||||||
Amounts payable, related party transactions | $ 207,092 | $ 0 | 229,918 | 612,171 | ||||||||||||||
Employee loan [Member] | ||||||||||||||||||
Disclosure of transactions between related parties [line items] | ||||||||||||||||||
Percentage of issued and outstanding common shares | 5% | |||||||||||||||||
Borrowings, interest rate | 5% | |||||||||||||||||
Amounts payable, related party transactions | $ 11,184 | $ 0 | 59,910 | 81,253 | ||||||||||||||
Two directors and CFO [Member] | ||||||||||||||||||
Disclosure of transactions between related parties [line items] | ||||||||||||||||||
Number of units issued | shares | 1,029 | |||||||||||||||||
Proceeds from issuing units | $ 90,000 | |||||||||||||||||
Two directors, Executive Chairman and CFO [Member] | ||||||||||||||||||
Disclosure of transactions between related parties [line items] | ||||||||||||||||||
Principal amount | $ 74,000 | |||||||||||||||||
Bonus common shares | shares | 529 | |||||||||||||||||
Director, Executive Chairman and CFO [Member] | ||||||||||||||||||
Disclosure of transactions between related parties [line items] | ||||||||||||||||||
Number of units issued | shares | 5,813 | |||||||||||||||||
Proceeds from issuing units | $ 87,500 | |||||||||||||||||
Executive Chairman and CFO [Member] | ||||||||||||||||||
Disclosure of transactions between related parties [line items] | ||||||||||||||||||
Amounts payable, related party transactions | $ 60,000 | |||||||||||||||||
Officers and directors [Member] | ||||||||||||||||||
Disclosure of transactions between related parties [line items] | ||||||||||||||||||
Amounts payable, related party transactions | $ 672,531 | |||||||||||||||||
Loans from investors [Member] | ||||||||||||||||||
Disclosure of transactions between related parties [line items] | ||||||||||||||||||
Principal amount | $ 126,960 | $ 26,961 | $ 64,829 | $ 50,000 | $ 50,000 | |||||||||||||
Amounts payable, related party transactions | $ 0 | $ 0 | $ 191,789 |
Related party transactions - Sc
Related party transactions - Schedule of key management personnel compensation (Details) - CAD ($) | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2019 | |
Disclosure of transactions between related parties [abstract] | ||||
Wages and benefits | $ 165,769 | $ 641,338 | $ 427,252 | $ 48,343 |
Consulting fees | 145,000 | 529,529 | 180,000 | 30,000 |
Directors compensation | 0 | 70,000 | 85,000 | 0 |
Share-based compensation | 24,959 | 860,400 | 988,716 | 0 |
Total | $ 335,728 | $ 2,101,267 | $ 1,680,968 | $ 78,343 |
Related party transactions - _2
Related party transactions - Schedule of related party loans (Details) - CAD ($) | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2021 | Dec. 31, 2019 | |
Disclosure of transactions between related parties [line items] | |||
Beginning balance | $ 289,828 | $ 218,276 | $ 885,213 |
Additions | 310,684 | ||
Accrued interest | 8,448 | 4,581 | 26,363 |
Transferred to convertible debentures | (192,561) | ||
Converted into common shares | (649,500) | ||
Converted into warrants | (19,858) | ||
Repayment of loans | (80,000) | (222,857) | (70,513) |
Ending balance | 218,276 | 0 | 289,828 |
Loans from CEO [Member] | |||
Disclosure of transactions between related parties [line items] | |||
Beginning balance | 229,918 | 207,092 | 612,171 |
Additions | 309,912 | ||
Accrued interest | 7,174 | 4,513 | 22,706 |
Transferred to convertible debentures | 0 | ||
Converted into common shares | (649,500) | ||
Converted into warrants | (19,858) | ||
Repayment of loans | (30,000) | (211,605) | (45,513) |
Ending balance | 207,092 | 0 | 229,918 |
Employee loan [Member] | |||
Disclosure of transactions between related parties [line items] | |||
Beginning balance | 59,910 | 11,184 | 81,253 |
Additions | 0 | ||
Accrued interest | 1,274 | 68 | 3,657 |
Transferred to convertible debentures | 0 | ||
Converted into common shares | 0 | ||
Converted into warrants | 0 | ||
Repayment of loans | (50,000) | (11,252) | (25,000) |
Ending balance | 11,184 | 0 | 59,910 |
Loans from investors [Member] | |||
Disclosure of transactions between related parties [line items] | |||
Beginning balance | 0 | $ 0 | 191,789 |
Additions | 772 | ||
Accrued interest | 0 | 0 | |
Transferred to convertible debentures | (192,561) | ||
Converted into common shares | 0 | ||
Converted into warrants | 0 | ||
Repayment of loans | 0 | 0 | |
Ending balance | $ 0 | $ 0 |
Borrowings (Narrative) (Details
Borrowings (Narrative) (Details) | 1 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||||||||||
Mar. 11, 2022 CAD ($) shares | Aug. 25, 2022 USD ($) shares | Feb. 24, 2021 CAD ($) | May 31, 2020 CAD ($) | Mar. 31, 2020 CAD ($) | Sep. 30, 2020 CAD ($) | Sep. 30, 2022 CAD ($) | Sep. 30, 2021 CAD ($) | Aug. 25, 2022 CAD ($) $ / shares shares | Aug. 25, 2022 USD ($) shares | Mar. 15, 2022 CAD ($) | Dec. 31, 2020 CAD ($) | Dec. 30, 2020 CAD ($) | Apr. 30, 2020 CAD ($) | Dec. 31, 2019 CAD ($) | |
Disclosure of detailed information about borrowings [line items] | |||||||||||||||
Value of aggregate unsecured loans | $ 32,273 | $ 2,278,774 | $ 53,251 | $ 0 | |||||||||||
Gain on government grant | 9,096 | 0 | 3,514 | ||||||||||||
Deferred financing fees | 0 | 150,409 | 0 | ||||||||||||
Share offering costs | $ 58,065 | $ 45,283 | 699,886 | 33,880 | 606,622 | ||||||||||
Repayment of borrowings | 310,527 | ||||||||||||||
August 2022 Loans [Member] | |||||||||||||||
Disclosure of detailed information about borrowings [line items] | |||||||||||||||
Value of aggregate unsecured loans | 0 | 435,348 | 0 | $ 400,000 | |||||||||||
Borrowing interest rate | 6% | 6% | |||||||||||||
Gain on government grant | 0 | ||||||||||||||
Percentage of repayment of the principal amount plus accrued interest | 110% | 110% | |||||||||||||
Fee paid through cash | $ 32,000 | ||||||||||||||
Deferred financing fees | 76,354 | ||||||||||||||
Repayment of borrowings | 0 | ||||||||||||||
August 2022 Loans [Member] | First August 2022 Loan [Member] | |||||||||||||||
Disclosure of detailed information about borrowings [line items] | |||||||||||||||
Value of aggregate unsecured loans | $ 260,698 | $ 200,000 | |||||||||||||
Closing foreign exchange rate | 1.2983 | ||||||||||||||
Share price | $ / shares | $ 12.25 | ||||||||||||||
Bonus shares issued to lenders | shares | 4,239 | ||||||||||||||
Estimated market discount rate | 24% | ||||||||||||||
Estimated fair value of loan | $ 214,893 | ||||||||||||||
Estimated fair value of bonus shares | $ 45,804 | ||||||||||||||
August 2022 Loans [Member] | Call Option Agreements [Member] | |||||||||||||||
Disclosure of detailed information about borrowings [line items] | |||||||||||||||
Share price | $ / shares | $ 12.25 | ||||||||||||||
Number of shares to be purchased under call option | shares | 10,591 | 10,591 | |||||||||||||
Term of call option | 5 years | ||||||||||||||
March 2022 Loan [Member] | |||||||||||||||
Disclosure of detailed information about borrowings [line items] | |||||||||||||||
Value of aggregate unsecured loans | $ 2,000,000 | 0 | 1,764,630 | 0 | |||||||||||
Borrowing interest rate | 9% | ||||||||||||||
Gain on government grant | 0 | ||||||||||||||
Bonus shares issued to lenders | shares | 14,286 | ||||||||||||||
Estimated market discount rate | 22% | ||||||||||||||
Estimated fair value of loan | $ 1,634,112 | ||||||||||||||
Adjustment to share capital for bonus common shares issued | 365,888 | ||||||||||||||
Total offering costs | 90,636 | ||||||||||||||
Deferred financing fees | 74,055 | 74,055 | |||||||||||||
Share offering costs | 16,581 | ||||||||||||||
Repayment of borrowings | 0 | ||||||||||||||
March 2022 Loan [Member] | First March 2022 Loan [Member] | |||||||||||||||
Disclosure of detailed information about borrowings [line items] | |||||||||||||||
Value of aggregate unsecured loans | 1,800,000 | ||||||||||||||
March 2022 Loan [Member] | Second March 2022 Loan [Member] | |||||||||||||||
Disclosure of detailed information about borrowings [line items] | |||||||||||||||
Value of aggregate unsecured loans | $ 200,000 | ||||||||||||||
March 2022 Loan [Member] | Officers and directors [Member] | |||||||||||||||
Disclosure of detailed information about borrowings [line items] | |||||||||||||||
Value of aggregate unsecured loans | $ 74,000 | ||||||||||||||
February 2021 Loan [Member] | |||||||||||||||
Disclosure of detailed information about borrowings [line items] | |||||||||||||||
Value of aggregate unsecured loans | $ 306,000 | 0 | 0 | 0 | |||||||||||
Borrowing interest rate | 0.50% | ||||||||||||||
Gain on government grant | 0 | ||||||||||||||
Deferred financing fees | 0 | ||||||||||||||
Repayment of borrowings | $ 310,527 | 310,527 | |||||||||||||
CEBA Term Loan [Member] | |||||||||||||||
Disclosure of detailed information about borrowings [line items] | |||||||||||||||
Term loan received | $ 40,000 | ||||||||||||||
Value of aggregate unsecured loans | 32,273 | 78,796 | 53,251 | $ 60,000 | $ 20,000 | $ 30,904 | |||||||||
Additional borrowings | 40,000 | 20,000 | |||||||||||||
Borrowing interest rate | 10% | ||||||||||||||
Gain on government grant | 9,096 | 3,514 | |||||||||||||
Deferred financing fees | 0 | ||||||||||||||
Repayment of borrowings | 0 | ||||||||||||||
Gain on government grant | $ (9,096) | $ (3,514) | |||||||||||||
CEBA Term Loan [Member] | Police Ordnance acquisition [Member] | |||||||||||||||
Disclosure of detailed information about borrowings [line items] | |||||||||||||||
Additional borrowings | 40,000 | ||||||||||||||
RBC Credit Facility [Member] | |||||||||||||||
Disclosure of detailed information about borrowings [line items] | |||||||||||||||
Cash collateral amount | 30,000 | ||||||||||||||
Short term guaranteed investment certificate | $ 30,000 |
Borrowings - Schedule of change
Borrowings - Schedule of changes in borrowings (Details) - CAD ($) | 1 Months Ended | 9 Months Ended | 12 Months Ended | |||
Mar. 11, 2022 | Feb. 24, 2021 | Sep. 30, 2020 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2019 | |
Disclosure of detailed information about borrowings [line items] | ||||||
Balance, Beginning | $ 0 | $ 53,251 | $ 32,273 | |||
Additional borrowings | 40,000 | 2,543,230 | 326,000 | $ 0 | ||
Gain on government grant | (9,096) | 0 | (3,514) | |||
Accrued interest and accretion expense | 321,313 | 9,019 | ||||
Repayment of borrowings | (310,527) | |||||
Assumed from acquisition | 26,238 | |||||
Issuance at fair value | 2,109,874 | |||||
Deferred financing fees | 0 | (150,409) | 0 | |||
Net borrowings | 2,038,954 | |||||
Adjustment | (5,496) | |||||
Foreign exchange loss | 24,523 | |||||
Interest paid | (100,520) | |||||
Balance, Ending | 32,273 | 2,278,774 | 53,251 | 0 | ||
Current | 32,273 | 2,199,978 | 0 | 0 | ||
Non-current | 0 | 78,796 | 53,251 | $ 210,819 | ||
CEBA Term Loan [Member] | ||||||
Disclosure of detailed information about borrowings [line items] | ||||||
Balance, Beginning | 53,251 | 32,273 | ||||
Additional borrowings | 20,000 | |||||
Gain on government grant | (9,096) | (3,514) | ||||
Accrued interest and accretion expense | 4,803 | 4,492 | ||||
Repayment of borrowings | 0 | |||||
Assumed from acquisition | 26,238 | |||||
Issuance at fair value | 0 | |||||
Deferred financing fees | 0 | |||||
Net borrowings | 79,489 | |||||
Adjustment | (5,496) | |||||
Foreign exchange loss | 0 | |||||
Interest paid | 0 | |||||
Balance, Ending | 32,273 | 78,796 | 53,251 | |||
Current | 0 | |||||
Non-current | 78,796 | |||||
February 2021 Loan [Member] | ||||||
Disclosure of detailed information about borrowings [line items] | ||||||
Balance, Beginning | 0 | 0 | ||||
Additional borrowings | 306,000 | |||||
Gain on government grant | 0 | |||||
Accrued interest and accretion expense | 0 | 4,527 | ||||
Repayment of borrowings | $ (310,527) | (310,527) | ||||
Assumed from acquisition | 0 | |||||
Issuance at fair value | 0 | |||||
Deferred financing fees | 0 | |||||
Net borrowings | 0 | |||||
Adjustment | 0 | |||||
Foreign exchange loss | 0 | |||||
Interest paid | 0 | |||||
Balance, Ending | $ 306,000 | 0 | 0 | 0 | ||
Current | 0 | |||||
Non-current | 0 | |||||
March 2022 Loans [Member] | ||||||
Disclosure of detailed information about borrowings [line items] | ||||||
Balance, Beginning | 0 | 0 | ||||
Additional borrowings | 0 | |||||
Gain on government grant | 0 | |||||
Accrued interest and accretion expense | 304,922 | 0 | ||||
Repayment of borrowings | 0 | |||||
Assumed from acquisition | 0 | |||||
Issuance at fair value | 1,634,283 | |||||
Deferred financing fees | $ (74,055) | (74,055) | ||||
Net borrowings | 1,560,228 | |||||
Adjustment | 0 | |||||
Foreign exchange loss | 0 | |||||
Interest paid | 100,520 | |||||
Balance, Ending | $ 2,000,000 | 0 | 1,764,630 | 0 | ||
Current | 1,764,630 | |||||
Non-current | 0 | |||||
August 2022 Loans [Member] | ||||||
Disclosure of detailed information about borrowings [line items] | ||||||
Balance, Beginning | 0 | 0 | ||||
Additional borrowings | 0 | |||||
Gain on government grant | 0 | |||||
Accrued interest and accretion expense | 11,588 | 0 | ||||
Repayment of borrowings | 0 | |||||
Assumed from acquisition | 0 | |||||
Issuance at fair value | 475,591 | |||||
Deferred financing fees | (76,354) | |||||
Net borrowings | 399,237 | |||||
Adjustment | 0 | |||||
Foreign exchange loss | 24,523 | |||||
Interest paid | 0 | |||||
Balance, Ending | $ 0 | 435,348 | $ 0 | |||
Current | $ 435,348 |
Lease obligations (Narrative) (
Lease obligations (Narrative) (Details) | Sep. 30, 2020 CAD ($) |
Presentation of leases for lessee [abstract] | |
Gain on de-recognition of lease obligation | $ 17,527 |
Incremental estimated borrowing rate | 10% |
Lease obligations - Schedule of
Lease obligations - Schedule of lease obligations (Details) - CAD ($) | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2019 | |
Disclosure of quantitative information about right-of-use assets [line items] | ||||
Beginning balance (Total) | $ 202,686 | $ 307,909 | $ 352,037 | $ 280,053 |
Beginning balance (Current Portion) | 85,468 | 32,288 | 44,128 | 77,367 |
Beginning balance (Non-current portion) | 117,218 | 275,621 | 307,909 | 202,686 |
Addition | 347,640 | |||
Termination | (157,315) | |||
Lease payments (including interest) | (70,436) | (101,890) | ||
Interest expense | 29,462 | 24,523 | ||
Ending balance (Non-current portion) | 352,037 | 275,621 | 307,909 | 202,686 |
Ending balance (Current Portion) | 44,128 | 69,150 | 32,288 | 85,468 |
Ending balance (Non-current portion) | 307,909 | 206,471 | 275,621 | 117,218 |
Offices [Member] | ||||
Disclosure of quantitative information about right-of-use assets [line items] | ||||
Beginning balance (Total) | 195,463 | 307,909 | 352,037 | 266,292 |
Addition | 347,640 | |||
Termination | (157,315) | |||
Lease payments (including interest) | (62,816) | (62,400) | (78,000) | (94,270) |
Interest expense | 29,065 | 30,112 | 33,872 | 23,441 |
Ending balance (Non-current portion) | 352,037 | $ 275,621 | 307,909 | 195,463 |
Printer [Member] | ||||
Disclosure of quantitative information about right-of-use assets [line items] | ||||
Beginning balance (Total) | 7,223 | $ 0 | 13,761 | |
Addition | 0 | |||
Termination | 0 | |||
Lease payments (including interest) | (7,620) | (7,620) | ||
Interest expense | 397 | 1,082 | ||
Ending balance (Non-current portion) | $ 0 | $ 7,223 |
Lease obligations - Schedule _2
Lease obligations - Schedule of contractual undiscounted cash flows (Details) - CAD ($) | Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2019 |
Disclosure of maturity analysis of operating lease payments [line items] | ||||
Contractual undiscounted cash flows | $ 327,600 | $ 390,000 | $ 468,000 | $ 227,583 |
Less than one year [Member] | ||||
Disclosure of maturity analysis of operating lease payments [line items] | ||||
Contractual undiscounted cash flows | 93,600 | 62,400 | 78,000 | 101,890 |
One to five years [Member] | ||||
Disclosure of maturity analysis of operating lease payments [line items] | ||||
Contractual undiscounted cash flows | $ 234,000 | $ 327,600 | $ 390,000 | $ 125,693 |
Contract Liabilities - Schedule
Contract Liabilities - Schedule of contract liabilities (Details) - CAD ($) | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2019 | |
Contract liabilities [abstract] | ||||
Balance, beginning of fiscal year | $ 0 | $ 0 | $ 7,053 | $ 0 |
Acquired in acquisition of POC | 29,759 | 0 | ||
Amounts invoiced and revenue deferred | 7,053 | 17,512 | 0 | 0 |
Recognition of deferred revenue included in the balance at the beginning of period | 0 | 0 | (7,053) | 0 |
Balance, end of fiscal year | $ 7,053 | $ 47,271 | $ 0 | $ 0 |
Financial derivative liabilit_3
Financial derivative liabilities - Schedule of financial derivative liabilities (Details) - CAD ($) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Dec. 31, 2019 | |
Disclosure of maturity analysis for derivative financial liabilities [abstract] | ||
Beginning balance | $ 29,463 | $ 111,953 |
Fair value adjustment when notes were converted into common shares | (111,953) | |
Fair value of financial derivative liabilities on initial recognition | 30,688 | |
Fair value adjustment | (29,463) | (1,225) |
Ending balance | $ 0 | $ 29,463 |
Convertible notes (Narrative)
Convertible notes (Narrative) (Details) - CAD ($) | 1 Months Ended | 9 Months Ended | 12 Months Ended | |||
Oct. 28, 2022 | May 31, 2020 | Oct. 23, 2019 | Sep. 30, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Disclosure of detailed information about borrowings [line items] | ||||||
Description of reverse stock split | 1-for-70 Reverse Split | |||||
Convertible notes converted into common shares | $ 255,718 | |||||
Shares issued upon conversion of debt | 8,583 | |||||
Repayments of convertible notes | 0 | $ (31,644) | ||||
Convertible notes [Member] | ||||||
Disclosure of detailed information about borrowings [line items] | ||||||
Issue of convertible instruments | $ 234,515 | $ 601,961 | ||||
Borrowing interest rate | 10% | 10% | ||||
Convertible notes converted into common shares | $ 560,007 | $ 255,718 | 620,897 | |||
Debt conversion, accrued interest, amount | $ 60,890 | |||||
Shares issued upon conversion of debt | 44,350 | 6,523 | ||||
Conversion of debt, conversion rate | $ 14 | |||||
Repayments of convertible notes | $ (31,644) | $ (31,644) | ||||
Discount rate | 20% |
Convertible notes - Schedule of
Convertible notes - Schedule of convertible notes (Details) - CAD ($) | 1 Months Ended | 9 Months Ended | 12 Months Ended | ||
Oct. 23, 2019 | Sep. 30, 2020 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2019 | |
Disclosure of detailed information about borrowings [line items] | |||||
Beginning balance | $ 210,819 | $ 53,251 | $ 0 | ||
Converted into common shares | (255,718) | ||||
Repayment of debt | 0 | $ (31,644) | |||
Less fair value of conversion feature | (30,688) | ||||
Accrued interest and accretion expense | 321,313 | 9,019 | |||
Ending balance | 0 | $ 78,796 | 53,251 | 210,819 | |
Convertible notes [Member] | |||||
Disclosure of detailed information about borrowings [line items] | |||||
Beginning balance | 210,819 | $ 0 | 521,515 | ||
Related party loans transferred to convertible notes | 192,561 | ||||
Converted into common shares | $ (560,007) | (255,718) | (620,897) | ||
Repayment of debt | $ (31,644) | (31,644) | |||
Less fair value of conversion feature | (30,688) | ||||
Accrued interest and accretion expense | 16,769 | 74,707 | |||
Accretion expenses | 28,130 | 105,265 | |||
Ending balance | $ 0 | $ 210,819 |
Share capital and Contributed_3
Share capital and Contributed Surplus (Narrative) (Details) | 1 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||||||||||||||||||||||
Jul. 14, 2022 CAD ($) $ / shares shares | Jun. 12, 2020 share $ / shares shares | Oct. 28, 2022 | Sep. 30, 2021 CAD ($) $ / shares shares | Apr. 30, 2021 CAD ($) $ / shares shares | Sep. 30, 2020 CAD ($) shares | Sep. 17, 2020 CAD ($) $ / shares shares | Jun. 30, 2020 CAD ($) $ / shares shares | May 31, 2020 CAD ($) $ / shares shares | Mar. 31, 2020 CAD ($) $ / shares shares | Jan. 31, 2020 CAD ($) $ / shares shares | Sep. 30, 2020 CAD ($) shares | Jun. 30, 2020 CAD ($) shares | Mar. 31, 2020 CAD ($) $ / shares | Sep. 30, 2019 CAD ($) $ / shares shares | Mar. 31, 2019 CAD ($) shares | Sep. 30, 2020 CAD ($) share $ / shares shares | Sep. 30, 2022 CAD ($) share shares | Sep. 30, 2021 CAD ($) share shares | Sep. 30, 2020 CAD ($) shares | Dec. 31, 2019 CAD ($) share $ / shares shares | Dec. 31, 2018 $ / shares shares | Apr. 30, 2022 shares | Dec. 31, 2021 CAD ($) | Aug. 31, 2021 shares | Aug. 31, 2020 shares | |
Disclosure of classes of share capital [line items] | ||||||||||||||||||||||||||
Description of reverse stock split | 1-for-70 Reverse Split | |||||||||||||||||||||||||
Number of warrants granted | shares | 1,000,000 | 5,043,165 | 1,085,050 | |||||||||||||||||||||||
Cash commission | $ 164,716 | $ 33,880 | $ 606,622 | $ 0 | ||||||||||||||||||||||
Share offering costs | $ 58,065 | $ 45,283 | 699,886 | 33,880 | 606,622 | |||||||||||||||||||||
Issue price per share | $ / shares | $ 31.5 | $ 66.67 | ||||||||||||||||||||||||
Proceeds from issue of ordinary shares | $ 4,355,171 | $ 344,000 | $ 6,002,472 | $ 1,014,948 | ||||||||||||||||||||||
Issuance of unsecured convertible notes | $ 1,100,000 | |||||||||||||||||||||||||
Unsecured convertible notes, interest rate | 15% | |||||||||||||||||||||||||
Percentage of principal amount received by holders | 25% | |||||||||||||||||||||||||
Shares issued upon conversion of debt | shares | 8,583 | |||||||||||||||||||||||||
Conversion of notes, number of shares issued | shares | 35,398 | |||||||||||||||||||||||||
Accrued interest | $ 59,112 | |||||||||||||||||||||||||
Number of shares converted from accrued interest | shares | 1,877 | |||||||||||||||||||||||||
Number of warrants outstanding | shares | 13,901,640 | 9,585,050 | 9,585,050 | 8,500,000 | 9,585,050 | 13,417,156 | 13,901,640 | 9,585,050 | 8,500,000 | 0 | 13,901,640 | 9,585,050 | ||||||||||||||
Number of warrants issued with insignificant fair value | shares | 6,500,000 | |||||||||||||||||||||||||
Number of share options granted | share | 29,357 | 9,500 | 52,988 | 0 | ||||||||||||||||||||||
Cancelled | share | 17,714 | |||||||||||||||||||||||||
Weighted-average fair value per option | $ 50.4 | $ 16.1 | $ 16.1 | $ 16.1 | $ 38.21 | $ 50.4 | $ 16.1 | |||||||||||||||||||
Estimated forfeiture rate | 0% | |||||||||||||||||||||||||
Options granted at different forfeiture rate | shares | 7,143 | |||||||||||||||||||||||||
Exercise price of option granted at forfeiture rate | $ / shares | $ 49 | |||||||||||||||||||||||||
Forfeiture rate default percentage | 50% | |||||||||||||||||||||||||
Total consideration | $ 24,959 | $ 860,400 | $ 988,716 | $ 0 | ||||||||||||||||||||||
Number of shares issued | shares | 589,518 | 383,996 | 383,996 | 383,996 | 699,511 | 589,518 | 383,996 | 383,996 | 3 | |||||||||||||||||
Professional fees expense | $ 190,398 | $ 1,028,240 | $ 778,337 | |||||||||||||||||||||||
Interest expense | $ 90,474 | $ 511,990 | $ 116,113 | |||||||||||||||||||||||
Private placement [Member] | ||||||||||||||||||||||||||
Disclosure of classes of share capital [line items] | ||||||||||||||||||||||||||
Number of units issued | shares | 22,857 | 10,714 | ||||||||||||||||||||||||
Price per unit issued | $ / shares | $ 15.05 | $ 140 | ||||||||||||||||||||||||
Proceeds from issuing units | $ 344,000 | $ 1,500,000 | ||||||||||||||||||||||||
Number of warrants granted | shares | 800,000 | |||||||||||||||||||||||||
Exercise price of warrants granted | $ / shares | $ 0.285 | $ 2.35 | ||||||||||||||||||||||||
Description of warrants issued | each for a period of 24 months from the closing date. Each Warrant converts into 0.01428571 common shares or 70 warrants for one common share. | |||||||||||||||||||||||||
Percentage of market capitalization | 25% | |||||||||||||||||||||||||
Description of units issued | each September Unit is comprised of one common share and seventy Warrant Shares at a price of $2.35 for each 1/70 of a common share (70 warrants for one common share) for a period of 24 months from September 16, 2021 ("September 2021 Warrants"). If at any time after four months and one day following September 16, 2021, the trading price of KWESST common stock on the TSX-V is equal to or exceeds $322.00 for a period of 3 consecutive trading days, as evidenced by the price at the close of market, we will be entitled to notify the holders of Warrants of its intention to force the exercise of the Warrants. Upon receipt of such notice, the holders of Warrants shall have 30 days to exercise the Warrants, failing which the Warrants will automatically expire. | |||||||||||||||||||||||||
Consideration allocated between common share and warrant | $ / shares | $ 140 | |||||||||||||||||||||||||
Fair value per warrant granted | $ / shares | 0.52 | |||||||||||||||||||||||||
Consideration allocated to common shares | $ / shares | $ 103.6 | |||||||||||||||||||||||||
Cash commission | $ 90,000 | |||||||||||||||||||||||||
Share offering costs | $ 130,730 | |||||||||||||||||||||||||
Issued common shares | shares | 229 | 12,082 | 37,500 | 72,500 | 37,500 | 72,500 | ||||||||||||||||||||
Issue of equity | $ 1,050,000 | $ 1,014,948 | ||||||||||||||||||||||||
Issue price per share | $ / shares | $ 34.93 | $ 35 | $ 28 | $ 28 | $ 14 | $ 28 | $ 14 | |||||||||||||||||||
Proceeds from issue of ordinary shares | $ 8,000 | $ 422,875 | $ 1,050,000 | $ 1,050,000 | $ 1,014,948 | |||||||||||||||||||||
Directors and officers [Member] | ||||||||||||||||||||||||||
Disclosure of classes of share capital [line items] | ||||||||||||||||||||||||||
Number of units issued | shares | 5,814 | 1,029 | ||||||||||||||||||||||||
Proceeds from issuing units | $ 87,500 | $ 90,000 | ||||||||||||||||||||||||
Brokered private placement [Member] | ||||||||||||||||||||||||||
Disclosure of classes of share capital [line items] | ||||||||||||||||||||||||||
Number of units issued | shares | 51,087 | |||||||||||||||||||||||||
Price per unit issued | $ / shares | $ 87.5 | |||||||||||||||||||||||||
Proceeds from issuing units | $ 4,470,071 | |||||||||||||||||||||||||
Exercise price of warrants granted | $ / shares | $ 1.75 | |||||||||||||||||||||||||
Description of units issued | Each April 2021 Warrant is exercisable to acquire 1/70 of a common share at a price of $1.75 each (70 warrants for one common share) for a period of 24 months from the closing of the April 2021 Offering ("Closing Date"). If at any time after four (4) months and one (1) day following the Closing Date, the trading price of KWESST common stock on the TSX Venture Exchange is equal to or exceeds $210.00 for a period of 10 consecutive trading days, as evidenced by the price at the close of market, we will be entitled to notify the holders of the April 2021 Warrants of its intention to force the exercise of the April 2021 Warrants. Upon receipt of such notice, the holders of April 2021 Warrants shall have 30 days to exercise the April 2021 Warrants, failing which the April 2021 Warrants will automatically expire. | |||||||||||||||||||||||||
Consideration allocated between common share and warrant | $ / shares | $ 87.5 | |||||||||||||||||||||||||
Consideration allocated to common shares | $ / shares | $ 70.7 | |||||||||||||||||||||||||
Cash commission | $ 288,405 | |||||||||||||||||||||||||
Share offering costs | 630,680 | |||||||||||||||||||||||||
Compensation options granted to agents | $ 233,057 | |||||||||||||||||||||||||
Issued common shares | shares | 62,994 | 0 | 51,087 | |||||||||||||||||||||||
Issue of equity | $ 3,087,138 | $ 0 | $ 3,611,818 | |||||||||||||||||||||||
Estimated fair value per warrant | $ / shares | $ 0.24 | |||||||||||||||||||||||||
Issue price per share | $ / shares | $ 49.01 | |||||||||||||||||||||||||
Asset acquisition [Member] | ||||||||||||||||||||||||||
Disclosure of classes of share capital [line items] | ||||||||||||||||||||||||||
Number of warrants granted | shares | 500,000 | |||||||||||||||||||||||||
Issued common shares | shares | 14,286 | 9,957 | 0 | 14,286 | ||||||||||||||||||||||
Issue of equity | $ 167,280 | $ 0 | $ 1,290,000 | |||||||||||||||||||||||
Estimated fair value per warrant | $ / shares | $ 0.85 | |||||||||||||||||||||||||
Issue price per share | $ / shares | $ 16.8 | |||||||||||||||||||||||||
September 2021 broker warrants [Member] | ||||||||||||||||||||||||||
Disclosure of classes of share capital [line items] | ||||||||||||||||||||||||||
Number of warrants granted | shares | 45,000 | |||||||||||||||||||||||||
Exercise price of warrants granted | $ / shares | $ 2 | |||||||||||||||||||||||||
Estimated fair value per warrant | $ / shares | $ 0.72 | |||||||||||||||||||||||||
Amended license [Member] | ||||||||||||||||||||||||||
Disclosure of classes of share capital [line items] | ||||||||||||||||||||||||||
Issued common shares | shares | 1,429 | 0 | 0 | 1,429 | ||||||||||||||||||||||
Issue of equity | $ 0 | $ 0 | $ 137,000 | |||||||||||||||||||||||
Debt settlements - legal fees [Member] | ||||||||||||||||||||||||||
Disclosure of classes of share capital [line items] | ||||||||||||||||||||||||||
Issued common shares | shares | 143 | 816 | ||||||||||||||||||||||||
Issue of equity | $ 19,000 | $ 47,000 | ||||||||||||||||||||||||
Debt settlements - online advertising services [Member] | ||||||||||||||||||||||||||
Disclosure of classes of share capital [line items] | ||||||||||||||||||||||||||
Issued common shares | shares | 346 | |||||||||||||||||||||||||
Issue of equity | $ 16,866 | |||||||||||||||||||||||||
Performance bonus [Member] | ||||||||||||||||||||||||||
Disclosure of classes of share capital [line items] | ||||||||||||||||||||||||||
Issued common shares | shares | 643 | 14,929 | 0 | 0 | ||||||||||||||||||||||
Issue of equity | $ 731,500 | $ 0 | $ 0 | |||||||||||||||||||||||
Issue price per share | $ / shares | $ 49 | |||||||||||||||||||||||||
Foremost's qualifying transaction [Member] | ||||||||||||||||||||||||||
Disclosure of classes of share capital [line items] | ||||||||||||||||||||||||||
Issued common shares | shares | 12,836 | 0 | 0 | |||||||||||||||||||||||
Issue of equity | $ 628,949 | $ 0 | $ 0 | |||||||||||||||||||||||
Issue price per share | $ / shares | $ 49 | |||||||||||||||||||||||||
Conversion of 10% 2019 converted notes [Member] | ||||||||||||||||||||||||||
Disclosure of classes of share capital [line items] | ||||||||||||||||||||||||||
Issued common shares | shares | 6,523 | 0 | 0 | |||||||||||||||||||||||
Issue of equity | $ 255,718 | $ 0 | $ 0 | |||||||||||||||||||||||
Directors converted loans [Member] | ||||||||||||||||||||||||||
Disclosure of classes of share capital [line items] | ||||||||||||||||||||||||||
Description of units issued | Each Unit is comprised of one common share and one common share purchase warrant. Each warrant entitles the holder to acquire 1/70 of a common share at a price of $14.00 per share and with an expiry date of June 14, 2024. | |||||||||||||||||||||||||
Issued common shares | shares | 92,857 | |||||||||||||||||||||||||
Issue of equity | $ 31,308 | |||||||||||||||||||||||||
Issue price per share | $ / shares | $ 0.34 | |||||||||||||||||||||||||
Shares issued upon conversion of debt | shares | 92,857 | |||||||||||||||||||||||||
Debt conversion, amount | $ 32,500 | |||||||||||||||||||||||||
Parent company converted loans [Member] | ||||||||||||||||||||||||||
Disclosure of classes of share capital [line items] | ||||||||||||||||||||||||||
Issued common shares | shares | 152,857 | |||||||||||||||||||||||||
Issue of equity | $ 467,000 | |||||||||||||||||||||||||
Issue price per share | $ / shares | $ 3.06 | |||||||||||||||||||||||||
Shares issued upon conversion of debt | shares | 152,857 | |||||||||||||||||||||||||
Debt conversion, amount | $ 467,000 | |||||||||||||||||||||||||
Directors converted loans two [Member] | ||||||||||||||||||||||||||
Disclosure of classes of share capital [line items] | ||||||||||||||||||||||||||
Issued common shares | shares | 21,429 | |||||||||||||||||||||||||
Issue of equity | $ 150,000 | |||||||||||||||||||||||||
Issue price per share | $ / shares | $ 7 | |||||||||||||||||||||||||
Shares issued upon conversion of debt | shares | 21,429 | |||||||||||||||||||||||||
Debt conversion, amount | $ 150,000 | |||||||||||||||||||||||||
Converted debt and accrued interest [Member] | ||||||||||||||||||||||||||
Disclosure of classes of share capital [line items] | ||||||||||||||||||||||||||
Issued common shares | shares | 6,523 | 44,350 | ||||||||||||||||||||||||
Issue of equity | $ 255,718 | $ 620,897 | ||||||||||||||||||||||||
Issue price per share | $ / shares | $ 39.2 | $ 14 | ||||||||||||||||||||||||
Shares issued upon conversion of debt | shares | 44,350 | |||||||||||||||||||||||||
Debt conversion, amount | $ 560,007 | |||||||||||||||||||||||||
Debt conversion, accrued interest, amount | $ 60,890 | |||||||||||||||||||||||||
Private placement two [Member] | ||||||||||||||||||||||||||
Disclosure of classes of share capital [line items] | ||||||||||||||||||||||||||
Issued common shares | shares | 12,082 | |||||||||||||||||||||||||
Issue of equity | $ 422,875 | |||||||||||||||||||||||||
Issue price per share | $ / shares | $ 35 | $ 35 | ||||||||||||||||||||||||
Proceeds from issue of ordinary shares | $ 422,875 | |||||||||||||||||||||||||
Non-brokered private placement for unsecured convertible notes [Member] | ||||||||||||||||||||||||||
Disclosure of classes of share capital [line items] | ||||||||||||||||||||||||||
Shares issued upon conversion of debt | shares | 35,398 | |||||||||||||||||||||||||
Issue of convertible instruments | $ 1,100,000 | |||||||||||||||||||||||||
Debt conversion, accrued interest, amount | $ 59,112 | |||||||||||||||||||||||||
Borrowings, interest rate | 15% | |||||||||||||||||||||||||
Accrued interest converted to common shares | shares | 1,877 | |||||||||||||||||||||||||
Additional common shares issued as 25% of principal amount of note [Member] | ||||||||||||||||||||||||||
Disclosure of classes of share capital [line items] | ||||||||||||||||||||||||||
Share offering costs | $ 58,065 | |||||||||||||||||||||||||
Issue price per share | $ / shares | $ 31.5 | |||||||||||||||||||||||||
Shares issued upon conversion of debt | shares | 8,583 | |||||||||||||||||||||||||
Private placement three [Member] | ||||||||||||||||||||||||||
Disclosure of classes of share capital [line items] | ||||||||||||||||||||||||||
Issued common shares | shares | 229 | 229 | ||||||||||||||||||||||||
Issue of equity | $ 8,000 | |||||||||||||||||||||||||
Issue price per share | $ / shares | $ 34.93 | |||||||||||||||||||||||||
Consulting services [Member] | ||||||||||||||||||||||||||
Disclosure of classes of share capital [line items] | ||||||||||||||||||||||||||
Issued common shares | shares | 871 | 0 | 0 | |||||||||||||||||||||||
Issue of equity | $ 32,393 | $ 0 | $ 0 | |||||||||||||||||||||||
Issue price per share | $ / shares | $ 37.19 | |||||||||||||||||||||||||
Shares for consulting services | shares | 871 | |||||||||||||||||||||||||
Pi Financial Corp [Member] | ||||||||||||||||||||||||||
Disclosure of classes of share capital [line items] | ||||||||||||||||||||||||||
Share offering costs | $ 325,887 | $ 325,887 | ||||||||||||||||||||||||
Issued common shares | shares | 62,994 | |||||||||||||||||||||||||
Issue price per share | $ / shares | $ 49.01 | |||||||||||||||||||||||||
Proceeds from issue of ordinary shares | $ 3,086,687 | $ 3,086,687 | ||||||||||||||||||||||||
Each to two M&A / capital market advisors [Member] | Performance bonus [Member] | ||||||||||||||||||||||||||
Disclosure of classes of share capital [line items] | ||||||||||||||||||||||||||
Issued common shares | shares | 7,143 | |||||||||||||||||||||||||
Police Ordnance acquisition [Member] | ||||||||||||||||||||||||||
Disclosure of classes of share capital [line items] | ||||||||||||||||||||||||||
Number of common shares issued | 3,965 | |||||||||||||||||||||||||
Number of additional common shares | shares | 875 | |||||||||||||||||||||||||
SageGuild LLC [Member] | ||||||||||||||||||||||||||
Disclosure of classes of share capital [line items] | ||||||||||||||||||||||||||
Number of common shares issued | share | 2,000 | |||||||||||||||||||||||||
Issued common shares | shares | 7,957 | |||||||||||||||||||||||||
Issue price per share | $ / shares | $ 35 | |||||||||||||||||||||||||
Number of warrants Issued in asset acquisition | shares | 750,000 |
Share capital and Contributed_4
Share capital and Contributed Surplus - (B) Warrants (C) Contributed Surplus (Narrative) (Details) | 1 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||||
Apr. 30, 2021 CAD ($) $ / shares | May 31, 2020 CAD ($) | Mar. 31, 2020 CAD ($) | Sep. 30, 2020 CAD ($) share $ / shares shares | Sep. 30, 2022 CAD ($) share $ / shares shares | Sep. 30, 2021 CAD ($) share $ / shares shares | Sep. 30, 2020 shares | Dec. 31, 2019 CAD ($) share | Mar. 31, 2022 shares | |
Disclosure of classes of share capital [line items] | |||||||||
Description of warrants exercise | the warrant holder must exercise 70 warrants to receive one common share. | ||||||||
Cash commission | $ 164,716 | $ 33,880 | $ 606,622 | $ 0 | |||||
Number of share options granted | share | 29,357 | 9,500 | 52,988 | 0 | |||||
Estimated life | 4 years 1 month 24 days | 3 years 5 months 23 days | |||||||
Expected volatility | 67.71% | 90.48% | 76.46% | 67.71% | |||||
Risk-free interest rate | 0.65% | 2.04% | 0.35% | 65% | |||||
Share issue related cost | $ 58,065 | $ 45,283 | $ 699,886 | $ 33,880 | $ 606,622 | ||||
Number of compensation options exercised | shares | 2,459 | ||||||||
Gross proceeds from option exercises | $ 215,148 | ||||||||
Number of options outstanding | shares | 837 | ||||||||
Description of maximum term of options granted | five years | ||||||||
Stock options available for grant under the plan | shares | 30,113 | 30,113 | |||||||
Weighted average exercise price of share options granted | $ / shares | $ 45.5 | $ 69.59 | $ 104.3 | ||||||
Weighted average vesting period of options | 10 months 13 days | 10 months 17 days | 1 year 9 months 25 days | ||||||
Weighted-average fair value of stock options | $ / shares | $ 16.1 | $ 38.21 | $ 50.4 | ||||||
Number of options with accelerated vesting | shares | 5,507 | ||||||||
Number of options with accelerated cancellation | shares | 3,571 | ||||||||
Additional stock based compensation charges | $ 65,813 | ||||||||
Number of other equity instruments granted | share | 28,668 | 21,412 | |||||||
Shared-based compensation expense | $ 283,084 | $ 1,960,072 | $ 2,462,207 | $ 0 | |||||
April 2021 Offering [Member] | |||||||||
Disclosure of classes of share capital [line items] | |||||||||
Cash commission | $ 288,405 | ||||||||
Number of share options granted | 3,296 | ||||||||
Exercise price, share options granted | $ / shares | $ 87.5 | ||||||||
Option exercisable term | two years | ||||||||
Description of stock option warrants exercise | Each Compensation Option Warrant is exercisable to acquire 1/70 of a Common Share (a "Compensation Option Warrant Share") at a price of $1.75 per Compensation Option Warrant Share (70 Compensation Option Warrant for one Compensation Option Warrant Share) for a period of 24 months from the closing of the Offering. | ||||||||
Fair value per compensation option | $ / shares | $ 77 | ||||||||
Estimated life | 2 years | ||||||||
Underlying stock price | $ / shares | $ 90.3 | ||||||||
Exercise price of outstanding share options | $ / shares | $ 87.5 | ||||||||
Expected volatility | 80% | ||||||||
Risk-free interest rate | 0.31% | ||||||||
Expected discount rate | 0% | ||||||||
Share issue related cost | $ 233,057 | ||||||||
Long-Term Incentive Plan [Member] | |||||||||
Disclosure of classes of share capital [line items] | |||||||||
Maximum number of common shares issuable under plan | shares | 60,382 | ||||||||
Stock options available for grant under the plan | shares | 19,833 | ||||||||
Number of share units available for grant under plan | shares | 27,503 | ||||||||
Restricted share units [Member] | |||||||||
Disclosure of classes of share capital [line items] | |||||||||
Number of other equity instruments granted | share | 10,726 | 16,412 | |||||||
Weighted-average grant date fair value | $ 43.5 | $ 105.7 | |||||||
Weighted average vesting period of other equity instruments | 2 months 4 days | 8 months 8 days | |||||||
Performance stock units [Member] | |||||||||
Disclosure of classes of share capital [line items] | |||||||||
Number of other equity instruments granted | share | 17,942 | 2,857 | |||||||
Weighted-average grant date fair value | $ 126.7 | $ 105 | |||||||
Weighted average vesting period of other equity instruments | 4 months 24 days | ||||||||
Share appreciation rights [Member] | |||||||||
Disclosure of classes of share capital [line items] | |||||||||
Number of other equity instruments granted | share | 514 | 2,143 | |||||||
Weighted average exercise price of other equity instruments granted | $ / shares | $ 126.7 | $ 115.5 |
Share capital and Contributed_5
Share capital and Contributed Surplus - Schedule of issued common shares (Details) - CAD ($) | 1 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||||||||||||
Sep. 30, 2021 | Apr. 30, 2021 | Sep. 17, 2020 | Jun. 30, 2020 | May 31, 2020 | Mar. 31, 2020 | Jan. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2019 | Dec. 31, 2018 | |
Disclosure of classes of share capital [line items] | ||||||||||||||||
Beginning Balance (in shares) | 383,996 | 383,996 | 383,996 | 699,511 | 589,518 | 3 | ||||||||||
Outstanding amount, beginning of the period | $ 2,284,353 | $ 2,284,353 | $ 2,284,353 | $ 17,215,068 | $ 9,374,563 | $ 200 | ||||||||||
Issued price | $ 31.5 | $ 66.67 | ||||||||||||||
Outstanding amount including share offering costs | $ 10,074,449 | 10,074,449 | ||||||||||||||
Less: share offering costs | $ (58,065) | $ (45,283) | $ (699,886) | $ (33,880) | $ (606,622) | |||||||||||
Ending Balance (in shares) | 699,511 | 589,517 | 589,518 | 383,996 | 589,518 | 773,225 | 699,511 | 383,996 | 3 | |||||||
Outstanding amount, end of the period | $ 17,215,068 | $ 9,374,563 | $ 2,284,353 | $ 9,374,563 | $ 19,496,640 | $ 17,215,068 | $ 2,284,353 | $ 200 | ||||||||
Directors converted loans [Member] | ||||||||||||||||
Disclosure of classes of share capital [line items] | ||||||||||||||||
Issued common shares | 92,857 | |||||||||||||||
Issued price | $ 0.34 | |||||||||||||||
Amount | $ 31,308 | |||||||||||||||
Parent company converted loans [Member] | ||||||||||||||||
Disclosure of classes of share capital [line items] | ||||||||||||||||
Issued common shares | 152,857 | |||||||||||||||
Issued price | $ 3.06 | |||||||||||||||
Amount | $ 467,000 | |||||||||||||||
Directors converted loans two [Member] | ||||||||||||||||
Disclosure of classes of share capital [line items] | ||||||||||||||||
Issued common shares | 21,429 | |||||||||||||||
Issued price | $ 7 | |||||||||||||||
Amount | $ 150,000 | |||||||||||||||
Converted debt and accrued interest [Member] | ||||||||||||||||
Disclosure of classes of share capital [line items] | ||||||||||||||||
Issued common shares | 6,523 | 44,350 | ||||||||||||||
Issued price | $ 39.2 | $ 14 | ||||||||||||||
Amount | $ 255,718 | $ 620,897 | ||||||||||||||
Private placement [Member] | ||||||||||||||||
Disclosure of classes of share capital [line items] | ||||||||||||||||
Issued common shares | 229 | 12,082 | 37,500 | 72,500 | 37,500 | 72,500 | ||||||||||
Issued price | $ 34.93 | $ 35 | $ 28 | $ 28 | $ 14 | $ 28 | $ 14 | |||||||||
Amount | $ 1,050,000 | $ 1,014,948 | ||||||||||||||
Less: share offering costs | $ (130,730) | |||||||||||||||
Private placement [Member] | ||||||||||||||||
Disclosure of classes of share capital [line items] | ||||||||||||||||
Issued common shares | 49,811 | 22,857 | 10,714 | |||||||||||||
Amount | $ 1,480,875 | $ 272,000 | $ 1,110,000 | |||||||||||||
Exercise of warrants [Member] | ||||||||||||||||
Disclosure of classes of share capital [line items] | ||||||||||||||||
Issued common shares | 0 | 19,000 | 10,380 | |||||||||||||
Amount | $ 0 | $ 277,098 | $ 815,307 | |||||||||||||
Bonus shares relating to borrowings [Member] | ||||||||||||||||
Disclosure of classes of share capital [line items] | ||||||||||||||||
Issued common shares | 0 | 18,525 | 0 | |||||||||||||
Amount | $ 0 | $ 411,692 | $ 0 | |||||||||||||
Conversion of share units [Member] | ||||||||||||||||
Disclosure of classes of share capital [line items] | ||||||||||||||||
Issued common shares | 0 | 8,349 | 138 | |||||||||||||
Amount | $ 0 | $ 874,840 | $ 12,498 | |||||||||||||
Acquisition [Member] | ||||||||||||||||
Disclosure of classes of share capital [line items] | ||||||||||||||||
Issued common shares | 0 | 3,965 | 0 | |||||||||||||
Amount | $ 0 | $ 377,503 | $ 0 | |||||||||||||
Conversion of contingent shares [Member] | ||||||||||||||||
Disclosure of classes of share capital [line items] | ||||||||||||||||
Issued common shares | 0 | 875 | 0 | |||||||||||||
Amount | $ 0 | $ 83,319 | $ 0 | |||||||||||||
Debt settlements [Member] | ||||||||||||||||
Disclosure of classes of share capital [line items] | ||||||||||||||||
Issued common shares | 0 | 143 | 1,305 | |||||||||||||
Amount | $ 0 | $ 19,000 | $ 63,866 | |||||||||||||
Brokered private placement [Member] | ||||||||||||||||
Disclosure of classes of share capital [line items] | ||||||||||||||||
Issued common shares | 62,994 | 0 | 51,087 | |||||||||||||
Issued price | $ 49.01 | |||||||||||||||
Amount | $ 3,087,138 | $ 0 | $ 3,611,818 | |||||||||||||
Less: share offering costs | $ (630,680) | |||||||||||||||
Exercise of stock options [Member] | ||||||||||||||||
Disclosure of classes of share capital [line items] | ||||||||||||||||
Issued common shares | 1,743 | 0 | 18,195 | |||||||||||||
Issued price | $ 44.8 | |||||||||||||||
Amount | $ 78,080 | $ 0 | $ 1,292,015 | |||||||||||||
Private placement two [Member] | ||||||||||||||||
Disclosure of classes of share capital [line items] | ||||||||||||||||
Issued common shares | 12,082 | |||||||||||||||
Issued price | $ 35 | $ 35 | ||||||||||||||
Amount | $ 422,875 | |||||||||||||||
Asset acquisition [Member] | ||||||||||||||||
Disclosure of classes of share capital [line items] | ||||||||||||||||
Issued common shares | 14,286 | 9,957 | 0 | 14,286 | ||||||||||||
Issued price | $ 16.8 | |||||||||||||||
Amount | $ 167,280 | $ 0 | $ 1,290,000 | |||||||||||||
New converted debt and accrued interest [Member] | ||||||||||||||||
Disclosure of classes of share capital [line items] | ||||||||||||||||
Issued common shares | 45,858 | |||||||||||||||
Issued price | $ 28.96 | |||||||||||||||
Amount | $ 1,328,163 | |||||||||||||||
Private placement three [Member] | ||||||||||||||||
Disclosure of classes of share capital [line items] | ||||||||||||||||
Issued common shares | 229 | 229 | ||||||||||||||
Issued price | $ 34.93 | |||||||||||||||
Amount | $ 8,000 | |||||||||||||||
Exercise of broker compensation options [Member] | ||||||||||||||||
Disclosure of classes of share capital [line items] | ||||||||||||||||
Issued common shares | 0 | 0 | 2,459 | |||||||||||||
Amount | $ 0 | $ 0 | $ 347,680 | |||||||||||||
Amended license [Member] | ||||||||||||||||
Disclosure of classes of share capital [line items] | ||||||||||||||||
Issued common shares | 1,429 | 0 | 0 | 1,429 | ||||||||||||
Amount | $ 0 | $ 0 | $ 137,000 | |||||||||||||
Conversion of 15% 2020 converted notes [Member] | ||||||||||||||||
Disclosure of classes of share capital [line items] | ||||||||||||||||
Issued common shares | 45,858 | 0 | 0 | |||||||||||||
Amount | $ 1,328,163 | $ 0 | $ 0 | |||||||||||||
Performance bonus [Member] | ||||||||||||||||
Disclosure of classes of share capital [line items] | ||||||||||||||||
Issued common shares | 643 | 14,929 | 0 | 0 | ||||||||||||
Issued price | $ 49 | |||||||||||||||
Amount | $ 731,500 | $ 0 | $ 0 | |||||||||||||
Foremost's qualifying transaction [Member] | ||||||||||||||||
Disclosure of classes of share capital [line items] | ||||||||||||||||
Issued common shares | 12,836 | 0 | 0 | |||||||||||||
Issued price | $ 49 | |||||||||||||||
Amount | $ 628,949 | $ 0 | $ 0 | |||||||||||||
Conversion of 10% 2019 converted notes [Member] | ||||||||||||||||
Disclosure of classes of share capital [line items] | ||||||||||||||||
Issued common shares | 6,523 | 0 | 0 | |||||||||||||
Amount | $ 255,718 | $ 0 | $ 0 | |||||||||||||
Consulting services [Member] | ||||||||||||||||
Disclosure of classes of share capital [line items] | ||||||||||||||||
Issued common shares | 871 | 0 | 0 | |||||||||||||
Issued price | $ 37.19 | |||||||||||||||
Amount | $ 32,393 | $ 0 | $ 0 | |||||||||||||
Share offering costs [Member] | ||||||||||||||||
Disclosure of classes of share capital [line items] | ||||||||||||||||
Less: share offering costs | $ (699,886) | $ (33,880) | $ (839,679) |
Share capital and Contributed_6
Share capital and Contributed Surplus - Schedule of warrant activity (Details) - CAD ($) | 1 Months Ended | 9 Months Ended | 12 Months Ended | |||||
Jul. 14, 2022 | Sep. 30, 2021 | Apr. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2019 | |
Disclosure of classes of share capital [line items] | ||||||||
Warrants outstanding, beginning of the period | 13,901,640 | 8,500,000 | 13,901,640 | 9,585,050 | 8,500,000 | 0 | ||
Number of warrants granted | 1,000,000 | 5,043,165 | 1,085,050 | |||||
Number of warrants exercised | (1,330,000) | (726,575) | 0 | |||||
Number of warrants expired | (154,484) | 0 | 0 | |||||
Warrants outstanding, end of the period | 13,901,640 | 9,585,050 | 13,417,156 | 13,901,640 | 9,585,050 | 8,500,000 | ||
Number of warrants exercisable end of the period | 12,901,640 | 8,835,050 | 12,792,156 | 12,901,640 | 8,835,050 | |||
Warrants exercise price, beginning of the period | $ 0.74 | $ 0.24 | $ 0.2 | $ 0 | ||||
Weighted average exercise price of warrants issued | 0.57 | 1.73 | 0.54 | |||||
Weighted average exercise price of warrants exercised | 0.26 | 1.05 | 0 | |||||
Weighted average exercise price of warrant expired | 0.56 | 0 | 0 | |||||
Warrants exercise price, end of the period | $ 0.74 | $ 0.24 | 0.78 | 0.74 | 0.24 | |||
Weighted average exercisable price of warrants outstanding end of the period | $ 0.75 | $ 0.22 | $ 0.82 | $ 0.75 | $ 0.22 | |||
Fair Value, beginning of the period | $ 1,192 | $ 257,312 | $ 0 | |||||
Fair value, end of the period | $ 257,312 | $ 1,959,796 | $ 257,312 | $ 1,192 | ||||
Weighted average remaining life, beginning of the period | 3 years 2 months 19 days | |||||||
Weighted average remaining life, end of the period | 3 years 2 months 19 days | 3 years 2 months 19 days | ||||||
Private placement [Member] | ||||||||
Disclosure of classes of share capital [line items] | ||||||||
Number of warrants granted | 800,000 | |||||||
Asset acquisition [Member] | ||||||||
Disclosure of classes of share capital [line items] | ||||||||
Number of warrants granted | 500,000 | |||||||
January 1, 2024 [Member] | ||||||||
Disclosure of classes of share capital [line items] | ||||||||
Number of warrants granted | 6,500,000 | |||||||
Weighted average exercise price of warrants issued | $ 0.2 | |||||||
Fair value of warrants granted | $ 1,192 | |||||||
Weighted average remaining life of warrants granted | 3 years 3 months | |||||||
Expiry date of warrants granted | Jan. 01, 2024 | |||||||
June 14, 2024 [Member] | ||||||||
Disclosure of classes of share capital [line items] | ||||||||
Number of warrants granted | 2,000,000 | |||||||
Weighted average exercise price of warrants issued | $ 0.2 | |||||||
Fair value of warrants granted | $ 19,858 | |||||||
Weighted average remaining life of warrants granted | 3 years 8 months 15 days | |||||||
Expiry date of warrants granted | Jun. 14, 2024 | |||||||
January 30, 2022 [Member] | Private placement [Member] | ||||||||
Disclosure of classes of share capital [line items] | ||||||||
Number of warrants granted | 15,000 | |||||||
Weighted average exercise price of warrants issued | $ 0.4 | |||||||
Fair value of warrants granted | $ 2,265 | |||||||
Weighted average remaining life of warrants granted | 1 year 3 months 29 days | |||||||
Expiry date of warrants granted | Jan. 30, 2022 | |||||||
May 8, 2022 [Member] | Private placement [Member] | ||||||||
Disclosure of classes of share capital [line items] | ||||||||
Number of warrants granted | 84,622 | |||||||
Weighted average exercise price of warrants issued | $ 0.45 | |||||||
Fair value of warrants granted | $ 13,515 | |||||||
Weighted average remaining life of warrants granted | 1 year 7 months 6 days | |||||||
Expiry date of warrants granted | May 08, 2022 | |||||||
June 12, 2022 [Member] | Asset acquisition [Member] | ||||||||
Disclosure of classes of share capital [line items] | ||||||||
Number of warrants granted | 750,000 | |||||||
Weighted average exercise price of warrants issued | $ 0.5 | |||||||
Fair value of warrants granted | $ 180,000 | |||||||
Weighted average remaining life of warrants granted | 2 years 3 months 14 days | |||||||
Expiry date of warrants granted | Jun. 12, 2022 | |||||||
July 9, 2022 [Member] | Private placement [Member] | ||||||||
Disclosure of classes of share capital [line items] | ||||||||
Number of warrants granted | 235,428 | |||||||
Weighted average exercise price of warrants issued | $ 0.7 | |||||||
Fair value of warrants granted | $ 60,340 | |||||||
Weighted average remaining life of warrants granted | 1 year 9 months 7 days | |||||||
Expiry date of warrants granted | Jul. 09, 2022 |
Share capital and Contributed_7
Share capital and Contributed Surplus - Schedule of additional information on outstanding warrants (Details) - CAD ($) | 12 Months Ended | |||||||
Sep. 30, 2022 | Dec. 31, 2019 | Sep. 30, 2021 | Aug. 31, 2021 | Sep. 30, 2020 | Aug. 31, 2020 | Sep. 30, 2019 | Dec. 31, 2018 | |
Disclosure of classes of share capital [line items] | ||||||||
Number of warrants outstanding | 13,417,156 | 8,500,000 | 13,901,640 | 13,901,640 | 9,585,050 | 9,585,050 | 8,500,000 | 0 |
Fair value | $ 1,959,796 | $ 1,192 | $ 257,312 | $ 0 | ||||
January 1, 2024 [Member] | ||||||||
Disclosure of classes of share capital [line items] | ||||||||
Expiry Date | Jan. 01, 2024 | |||||||
June 14, 2024 [Member] | ||||||||
Disclosure of classes of share capital [line items] | ||||||||
Expiry Date | Jun. 14, 2024 | |||||||
Founders warrants [Member] | Exercise price of $0.20 [Member] | January 1, 2024 [Member] | ||||||||
Disclosure of classes of share capital [line items] | ||||||||
Number of warrants outstanding | 5,520,000 | |||||||
Fair value | $ 1,013 | |||||||
Expiry Date | Jan. 01, 2024 | |||||||
Founders warrants [Member] | Exercise price of $0.20 [Member] | June 14, 2024 [Member] | ||||||||
Disclosure of classes of share capital [line items] | ||||||||
Number of warrants outstanding | 1,900,000 | |||||||
Fair value | $ 18,865 | |||||||
Expiry Date | Jun. 14, 2024 | |||||||
Ghoststeps warrants [Member] | Exercise price of $0.50 [Member] | January 15, 2023 [Member] | ||||||||
Disclosure of classes of share capital [line items] | ||||||||
Number of warrants outstanding | 250,000 | |||||||
Fair value | $ 60,000 | |||||||
Expiry Date | Jan. 15, 2023 | |||||||
April 2021 equity financing [Member] | Exercise price of $1.75 [Member] | April 29, 2023 [Member] | ||||||||
Disclosure of classes of share capital [line items] | ||||||||
Number of warrants outstanding | 3,274,657 | |||||||
Fair value | $ 785,918 | |||||||
Expiry Date | Apr. 29, 2023 | |||||||
April 2021 equity financing [Member] | Exercise price of $1.75 [Member] | August 25, 2023 [Member] | ||||||||
Disclosure of classes of share capital [line items] | ||||||||
Number of warrants outstanding | 40,000 | |||||||
Fair value | $ 9,600 | |||||||
Expiry Date | Aug. 25, 2023 | |||||||
LEC warrants [Member] | Exercise price of $0.70 [Member] | April 29, 2026 [Member] | ||||||||
Disclosure of classes of share capital [line items] | ||||||||
Number of warrants outstanding | 500,000 | |||||||
Fair value | $ 425,000 | |||||||
Expiry Date | Apr. 29, 2026 | |||||||
September 2021 equity financing [Member] | Exercise price of $2.35 [Member] | September 16, 2023 [Member] | ||||||||
Disclosure of classes of share capital [line items] | ||||||||
Number of warrants outstanding | 750,000 | |||||||
Fair value | $ 390,000 | |||||||
Expiry Date | Sep. 16, 2023 | |||||||
Broker warrants [Member] | Exercise price of $1.75 [Member] | April 29, 2026 [Member] | ||||||||
Disclosure of classes of share capital [line items] | ||||||||
Number of warrants outstanding | 137,499 | |||||||
Fair value | $ 33,000 | |||||||
Expiry Date | Apr. 29, 2023 | |||||||
Broker warrants [Member] | Exercise price of $2.00 [Member] | September 16, 2023 [Member] | ||||||||
Disclosure of classes of share capital [line items] | ||||||||
Number of warrants outstanding | 45,000 | |||||||
Fair value | $ 32,400 | |||||||
Expiry Date | Sep. 16, 2023 | |||||||
Acquisition of police ordnance [Member] | Exercise price of $1.72 [Member] | December 15, 2024 [Member] | ||||||||
Disclosure of classes of share capital [line items] | ||||||||
Number of warrants outstanding | 200,000 | |||||||
Fair value | $ 132,000 | |||||||
Expiry Date | Dec. 15, 2024 | |||||||
July 2022 equity financing [Member] | Exercise price of $0.285 [Member] | July 14, 2024 [Member] | ||||||||
Disclosure of classes of share capital [line items] | ||||||||
Number of warrants outstanding | 800,000 | |||||||
Fair value | $ 72,000 | |||||||
Expiry Date | Jul. 14, 2024 |
Share capital and Contributed_8
Share capital and Contributed Surplus - Schedule of weighted-average assumptions of warrants granted (Details) - CAD ($) | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2019 | |
Acquisition of POC [Member] | ||||
Disclosure of classes of share capital [line items] | ||||
Exercise Price | $ 1.72 | |||
1/70 of stock price | $ 1.36 | |||
Volatility | 84.70% | |||
Dividend Yield | $ 0 | |||
Risk-free interest rate | 1.04% | |||
Expected life | 3 years | |||
Weighted average fair value per warrant | $ 0.66 | |||
July 2022 Warrants [Member] | ||||
Disclosure of classes of share capital [line items] | ||||
Exercise Price | 0.285 | |||
1/70 of stock price | $ 0.215 | |||
Volatility | 90.50% | |||
Dividend Yield | $ 0 | |||
Risk-free interest rate | 3.12% | |||
Expected life | 2 years | |||
Weighted average fair value per warrant | $ 0.09 | |||
April 2021 warrants [Member] | ||||
Disclosure of classes of share capital [line items] | ||||
Exercise Price | $ 1.75 | |||
1/70 of stock price | $ 1.01 | |||
Volatility | 80% | |||
Dividend Yield | $ 0 | |||
Risk-free interest rate | 0.31% | |||
Barrier (accelerator on life of warrants) | $ 3 | |||
Rebate | $ 1.25 | |||
Expected life | 2 years | |||
Weighted average fair value per warrant | $ 0.24 | |||
September 2021 warrants [Member] | ||||
Disclosure of classes of share capital [line items] | ||||
Exercise Price | 2.35 | |||
1/70 of stock price | $ 2.14 | |||
Volatility | 80% | |||
Dividend Yield | $ 0 | |||
Risk-free interest rate | 0.26% | |||
Barrier (accelerator on life of warrants) | $ 4.6 | |||
Rebate | $ 2 | |||
Expected life | 1 year | |||
Weighted average fair value per warrant | $ 0.52 | |||
September 2021 broker warrants [Member] | ||||
Disclosure of classes of share capital [line items] | ||||
Exercise Price | 2 | |||
1/70 of stock price | $ 2.14 | |||
Volatility | 80% | |||
Dividend Yield | $ 0 | |||
Risk-free interest rate | 0.26% | |||
Expected life | 1 year | |||
Weighted average fair value per warrant | $ 0.72 | |||
LEC warrants [Member] | ||||
Disclosure of classes of share capital [line items] | ||||
Exercise Price | 0.7 | |||
1/70 of stock price | $ 0.4 | |||
Volatility | 0% | |||
Dividend Yield | $ 0 | |||
Risk-free interest rate | 69% | |||
Expected life | 10 months 6 days | |||
Weighted average fair value per warrant | $ 0.85 | |||
Warrants at $0.20 [Member] | ||||
Disclosure of classes of share capital [line items] | ||||
1/70 of stock price | $ 0.044 | |||
Volatility | 66.75% | |||
Dividend Yield | $ 0 | |||
Risk-free interest rate | 1.40% | |||
Expected life | 5 years | |||
Weighted average fair value per warrant | $ 0.0099 | |||
Warrants at $0.40 [Member] | ||||
Disclosure of classes of share capital [line items] | ||||
1/70 of stock price | $ 0.4 | |||
Volatility | 68% | |||
Dividend Yield | $ 0 | |||
Risk-free interest rate | 1.47% | |||
Expected life | 2 years | |||
Weighted average fair value per warrant | $ 0.15 | |||
Warrants at $0.45 [Member] | ||||
Disclosure of classes of share capital [line items] | ||||
1/70 of stock price | $ 0.5 | |||
Volatility | 68% | |||
Dividend Yield | $ 0 | |||
Risk-free interest rate | 0.27% | |||
Expected life | 2 years | |||
Weighted average fair value per warrant | $ 0.2 | |||
Warrants at $0.70 [Member] | ||||
Disclosure of classes of share capital [line items] | ||||
1/70 of stock price | $ 0.7 | |||
Volatility | 67% | |||
Dividend Yield | $ 0 | |||
Risk-free interest rate | 0.29% | |||
Expected life | 2 years | |||
Weighted average fair value per warrant | $ 0.26 |
Share capital and Contributed_9
Share capital and Contributed Surplus - Schedule of number and weighted average exercise prices of share options (Details) | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2020 share $ / shares shares | Sep. 30, 2022 share $ / shares | Sep. 30, 2021 share $ / shares | Dec. 31, 2019 share $ / shares | |
Disclosure of classes of share capital [abstract] | ||||
Options outstanding, beginning of the period | share | 0 | 59,536 | 28,838 | |
Number of share options granted | share | 29,357 | 9,500 | 52,988 | 0 |
Options from the Foremost qualifying transaction | shares | 1,224 | |||
Number of share options exercised | share | (1,743) | (18,194) | ||
Number of share options cancelled | share | (11,928) | (4,096) | ||
Options outstanding, end of the period | share | 28,838 | 57,108 | 59,536 | 0 |
Number of share options exercisable | share | 7,474 | 43,618 | ||
Weighted average exercise price, beginning of the period | $ 0 | $ 95.9 | $ 45.5 | |
Weighted average exercise price of share options granted | 45.5 | 69.59 | 104.3 | |
Weighted average exercise price of share options granted from Foremost qualifying transaction | 32.9 | |||
Weighted average exercise price of share options exercised | 35 | 50.4 | ||
Weighted average exercise price of share options cancelled | 131.76 | 48.3 | ||
Weighted average exercise price, end of the period | 45.5 | 83.87 | $ 95.9 | $ 0 |
Weighted average exercise price of share options exercisable | $ 42 | $ 83.9 |
Share capital and Contribute_10
Share capital and Contributed Surplus - Schedule of weighted-average assumptions of stock options granted (Details) | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2020 CAD ($) Year $ / shares | Sep. 30, 2022 CAD ($) Year $ / shares | Sep. 30, 2021 CAD ($) Year $ / shares | Sep. 30, 2020 CAD ($) Year $ / shares | |
Disclosure of classes of share capital [line items] | ||||
Volatility | 67.71% | 90.48% | 76.46% | 67.71% |
Dividend yield | 0% | 0% | 0% | 0% |
Risk-free interest rate | 0.65% | 2.04% | 0.35% | 65% |
Expected life (years) | Year | 4.15 | 2.91 | 2.26 | 3.38 |
Weighted-average fair value per option | $ | $ 16.1 | $ 38.21 | $ 50.4 | $ 16.1 |
Bottom of range [Member] | ||||
Disclosure of classes of share capital [line items] | ||||
Stock price | $ 28 | $ 14.7 | $ 49 | $ 28 |
Exercise price | 28 | 14.7 | 49 | 28 |
Top of range [Member] | ||||
Disclosure of classes of share capital [line items] | ||||
Stock price | 49 | 126.7 | 159.6 | 49 |
Exercise price | $ 49 | $ 126.7 | $ 159.6 | $ 49 |
Share capital and Contribute_11
Share capital and Contributed Surplus - Schedule of range of exercise prices of outstanding share options (Details) | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2020 share $ / shares | Sep. 30, 2022 share $ / shares | Sep. 30, 2021 share $ / shares | Dec. 31, 2019 share $ / shares | |
Disclosure of classes of share capital [line items] | ||||
Number outstanding | 28,838 | 57,108 | 59,536 | 0 |
Weighted average remaining contractual life | 4 years 1 month 24 days | 3 years 5 months 23 days | ||
Weighted average outstanding strike price | $ / shares | $ 45.5 | $ 83.87 | $ 95.9 | $ 0 |
Number exercisable | 7,474 | 43,618 | ||
Remaining exercisable contractual life | 3 years 3 months 3 days | |||
Weighted average exercisable strike price | $ / shares | $ 42 | $ 83.9 | ||
Exercise price $33.00 [Member] | ||||
Disclosure of classes of share capital [line items] | ||||
Exercise price of outstanding share options | $ / shares | $ 33 | |||
Number outstanding | 1,224 | |||
Weighted average remaining contractual life | 2 years 8 months 15 days | |||
Number exercisable | 1,224 | |||
Exercise price $35.00 [Member] | ||||
Disclosure of classes of share capital [line items] | ||||
Exercise price of outstanding share options | $ / shares | $ 35 | |||
Number outstanding | 2,614 | |||
Weighted average remaining contractual life | 8 months 1 day | |||
Number exercisable | 0 | |||
Exercise price $46.00 [Member] | ||||
Disclosure of classes of share capital [line items] | ||||
Exercise price of outstanding share options | $ / shares | $ 46 | |||
Number outstanding | 13,214 | |||
Weighted average remaining contractual life | 4 years 4 months 28 days | |||
Number exercisable | 3,304 | |||
Exercise price $49.00 [Member] | ||||
Disclosure of classes of share capital [line items] | ||||
Exercise price of outstanding share options | $ / shares | $ 49 | |||
Number outstanding | 11,786 | |||
Weighted average remaining contractual life | 4 years 9 months 14 days | |||
Number exercisable | 2,946 | |||
$14.70 to $41.16 [Member] | ||||
Disclosure of classes of share capital [line items] | ||||
Number outstanding | 4,592 | |||
Weighted average remaining contractual life | 4 years 6 months 14 days | |||
Weighted average outstanding strike price | $ / shares | $ 15.91 | |||
Number exercisable | 306 | |||
Remaining exercisable contractual life | 8 months 15 days | |||
Weighted average exercisable strike price | $ / shares | $ 32.9 | |||
$14.70 to $41.16 [Member] | Bottom of range [Member] | ||||
Disclosure of classes of share capital [line items] | ||||
Exercise price of outstanding share options | $ / shares | $ 14.7 | |||
$14.70 to $41.16 [Member] | Top of range [Member] | ||||
Disclosure of classes of share capital [line items] | ||||
Number outstanding | 41.16 | |||
$41.17 to $67.63 [Member] | ||||
Disclosure of classes of share capital [line items] | ||||
Number outstanding | 12,329 | |||
Weighted average remaining contractual life | 2 years 8 months 26 days | |||
Weighted average outstanding strike price | $ / shares | $ 48.74 | |||
Number exercisable | 12,329 | |||
Remaining exercisable contractual life | 2 years 8 months 26 days | |||
Weighted average exercisable strike price | $ / shares | $ 48.74 | |||
$41.17 to $67.63 [Member] | Bottom of range [Member] | ||||
Disclosure of classes of share capital [line items] | ||||
Exercise price of outstanding share options | $ / shares | $ 41.17 | |||
$41.17 to $67.63 [Member] | Top of range [Member] | ||||
Disclosure of classes of share capital [line items] | ||||
Number outstanding | 67.63 | |||
$67.64 to $94.10 [Member] | ||||
Disclosure of classes of share capital [line items] | ||||
Number outstanding | 20,973 | |||
Weighted average remaining contractual life | 3 years 5 months 19 days | |||
Weighted average outstanding strike price | $ / shares | $ 78.02 | |||
Number exercisable | 17,080 | |||
Remaining exercisable contractual life | 3 years 4 months 17 days | |||
Weighted average exercisable strike price | $ / shares | $ 75.79 | |||
$67.64 to $94.10 [Member] | Bottom of range [Member] | ||||
Disclosure of classes of share capital [line items] | ||||
Exercise price of outstanding share options | $ / shares | $ 67.64 | |||
$67.64 to $94.10 [Member] | Top of range [Member] | ||||
Disclosure of classes of share capital [line items] | ||||
Number outstanding | 94.1 | |||
$94.11 to 120.57 [Member] | ||||
Disclosure of classes of share capital [line items] | ||||
Number outstanding | 7,448 | |||
Weighted average remaining contractual life | 3 years 4 months 2 days | |||
Weighted average outstanding strike price | $ / shares | $ 118.59 | |||
Number exercisable | 7,448 | |||
Remaining exercisable contractual life | 3 years 4 months 2 days | |||
Weighted average exercisable strike price | $ / shares | $ 118.59 | |||
$94.11 to 120.57 [Member] | Bottom of range [Member] | ||||
Disclosure of classes of share capital [line items] | ||||
Exercise price of outstanding share options | $ / shares | $ 94.11 | |||
$94.11 to 120.57 [Member] | Top of range [Member] | ||||
Disclosure of classes of share capital [line items] | ||||
Number outstanding | 120.57 | |||
$120.58 to $147.00 [Member] | ||||
Disclosure of classes of share capital [line items] | ||||
Number outstanding | 11,766 | |||
Weighted average remaining contractual life | 3 years 11 months 12 days | |||
Weighted average outstanding strike price | $ / shares | $ 135.66 | |||
Number exercisable | 6,455 | |||
Remaining exercisable contractual life | 3 years 11 months 19 days | |||
Weighted average exercisable strike price | $ / shares | $ 134.87 | |||
$120.58 to $147.00 [Member] | Bottom of range [Member] | ||||
Disclosure of classes of share capital [line items] | ||||
Exercise price of outstanding share options | $ / shares | $ 120.58 | |||
$120.58 to $147.00 [Member] | Top of range [Member] | ||||
Disclosure of classes of share capital [line items] | ||||
Number outstanding | 147 |
Share capital and Contribute_12
Share capital and Contributed Surplus - Schedule of changes in share units (Details) - share | 12 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Disclosure of classes of share capital [line items] | ||
Outstanding, beginning of year | 21,273 | 0 |
Granted | 28,668 | 21,412 |
Vested and converted to common shares | (8,347) | (139) |
Vested and repurchased for withholding taxes | (393) | |
Expired / cancelled | (17,714) | |
Outstanding, end of year | 24,001 | 21,273 |
Restricted share units [Member] | ||
Disclosure of classes of share capital [line items] | ||
Outstanding, beginning of year | 16,273 | 0 |
Granted | 10,726 | 16,412 |
Vested and converted to common shares | (5,681) | (139) |
Vested and repurchased for withholding taxes | (144) | |
Expired / cancelled | 0 | |
Outstanding, end of year | 21,174 | 16,273 |
Performance stock units [Member] | ||
Disclosure of classes of share capital [line items] | ||
Outstanding, beginning of year | 2,857 | 0 |
Granted | 17,942 | 2,857 |
Vested and converted to common shares | (2,666) | 0 |
Vested and repurchased for withholding taxes | (249) | |
Expired / cancelled | (17,714) | |
Outstanding, end of year | 170 | 2,857 |
Share appreciation rights [Member] | ||
Disclosure of classes of share capital [line items] | ||
Outstanding, beginning of year | 2,143 | 0 |
Granted | 514 | 2,143 |
Vested and converted to common shares | 0 | 0 |
Vested and repurchased for withholding taxes | 0 | |
Expired / cancelled | 0 | |
Outstanding, end of year | 2,657 | 2,143 |
Share capital and Contribute_13
Share capital and Contributed Surplus - Schedule of share-based compensation expense by function (Details) - CAD ($) | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2019 | |
Disclosure of classes of share capital [line items] | ||||
Shared-based compensation expense | $ 283,084 | $ 1,960,072 | $ 2,462,207 | $ 0 |
General and administrative [Member] | ||||
Disclosure of classes of share capital [line items] | ||||
Shared-based compensation expense | 160,267 | 1,104,858 | 1,425,111 | |
Selling and marketing [Member] | ||||
Disclosure of classes of share capital [line items] | ||||
Shared-based compensation expense | 42,700 | 552,627 | 754,167 | |
Research and development, net [Member] | ||||
Disclosure of classes of share capital [line items] | ||||
Shared-based compensation expense | $ 80,117 | $ 302,587 | $ 282,929 |
Earnings (loss) per share (Narr
Earnings (loss) per share (Narrative) (Details) | 1 Months Ended |
Oct. 28, 2022 | |
Earnings per share [abstract] | |
Description of reverse stock split | 1-for-70 Reverse Split |
Earnings (loss) per share - Sch
Earnings (loss) per share - Schedule of earnings (loss) per share (Details) - shares | 9 Months Ended | 12 Months Ended | |||
Sep. 30, 2020 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2019 | Dec. 31, 2018 | |
Earnings per share [abstract] | |||||
Issued common shares | 383,996 | 699,511 | 589,518 | 383,996 | 3 |
Effect of shares issued from: | |||||
Exercise of warrants | 0 | 10,593 | 4,383 | ||
Issuance of bonus shares | 0 | 8,262 | 0 | ||
Private placements | 45,665 | 4,571 | 21,810 | ||
Conversion of stock units | 0 | 3,703 | 31 | ||
Acquisition of Police Ordnance | 0 | 3,144 | 0 | ||
Conversion of contingent shares | 0 | 386 | 0 | ||
Debt settlements | 0 | 132 | 1,038 | ||
Conversion of directors converted loans | 0 | 101,174 | |||
Conversion of parent company converted loans | 0 | 126,055 | |||
Exercise of options | 447 | 0 | 9,118 | 0 | |
Asset acquisitions | 1,272 | 0 | 6,027 | ||
Amended license agreement | 0 | 0 | 626 | ||
Exercise of broker options | 0 | 0 | 170 | ||
Conversion of convertible notes, including interest | 7,126 | 0 | 0 | 21,769 | |
Services rendered | 1,373 | 0 | 0 | ||
Foremost's QT | 752 | 0 | 0 | ||
Issuance for services | 1,373 | 0 | |||
Issuance for technology acquisition | 1,272 | 0 | |||
Issuance of for equity private placements | 45,665 | 0 | |||
Qualifying transaction | 752 | 0 | |||
Weighted average number of basic common shares | 440,631 | 730,302 | 632,721 | 249,001 | |
Dilutive securities: | |||||
Stock options | 0 | 0 | 0 | 0 | |
Warrants | 0 | 0 | 0 | 0 | |
Weighted average number of dilutive common shares | 440,631 | 730,302 | 632,721 | 249,001 |
Revenue (Narrative) (Details)
Revenue (Narrative) (Details) - CAD ($) | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2022 | Sep. 30, 2021 | |
Disclosure of disaggregation of revenue from contracts with customers [line items] | |||
Contract revenue not yet recognized | $ 233,193 | $ 625,177 | $ 16,545 |
Within 12 months [Member] | |||
Disclosure of disaggregation of revenue from contracts with customers [line items] | |||
Percentage of revenue expected to be recognized | 43% | ||
2 to 3 years [Member] | |||
Disclosure of disaggregation of revenue from contracts with customers [line items] | |||
Percentage of revenue expected to be recognized | 57% | ||
One customer [Member] | |||
Disclosure of disaggregation of revenue from contracts with customers [line items] | |||
Percentage of entity's revenue | 61% | 41% | 95% |
Customer two [Member] | |||
Disclosure of disaggregation of revenue from contracts with customers [line items] | |||
Percentage of entity's revenue | 35% |
Revenue - Schedule of revenue (
Revenue - Schedule of revenue (Details) - CAD ($) | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2019 | |
Disclosure of disaggregation of revenue from contracts with customers [line items] | ||||
Revenue | $ 861,917 | $ 721,519 | $ 1,275,804 | $ 509,148 |
Digitization [Member] | ||||
Disclosure of disaggregation of revenue from contracts with customers [line items] | ||||
Revenue | 835,097 | 354,620 | 1,255,982 | |
Non-Lethal [Member] | ||||
Disclosure of disaggregation of revenue from contracts with customers [line items] | ||||
Revenue | 0 | 330,658 | 0 | |
Training and services [Member] | ||||
Disclosure of disaggregation of revenue from contracts with customers [line items] | ||||
Revenue | 0 | 34,590 | 0 | |
Systems [Member] | ||||
Disclosure of disaggregation of revenue from contracts with customers [line items] | ||||
Revenue | 835,097 | 472,749 | ||
Other [Member] | ||||
Disclosure of disaggregation of revenue from contracts with customers [line items] | ||||
Revenue | 26,820 | 1,651 | 19,822 | $ 36,399 |
United States [Member] | ||||
Disclosure of disaggregation of revenue from contracts with customers [line items] | ||||
Revenue | 835,097 | 389,210 | 1,238,063 | |
Canada [Member] | ||||
Disclosure of disaggregation of revenue from contracts with customers [line items] | ||||
Revenue | 26,820 | 332,309 | 37,741 | |
Products and services transferred over time [Member] | ||||
Disclosure of disaggregation of revenue from contracts with customers [line items] | ||||
Revenue | 835,097 | 389,210 | 1,238,063 | |
Products transferred at a point in time [Member] | ||||
Disclosure of disaggregation of revenue from contracts with customers [line items] | ||||
Revenue | $ 26,820 | $ 332,309 | $ 37,741 |
Expenses by nature - Schedule o
Expenses by nature - Schedule of expenses by nature (Details) - CAD ($) | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2019 | |
Expenses by nature [abstract] | ||||
Employee benefits | $ 1,161,071 | $ 4,883,062 | $ 4,746,316 | |
Advertising and promotion | 220,946 | 1,352,750 | 1,914,630 | |
Consulting fees | 620,295 | 1,315,917 | 1,138,782 | |
Professional fees | 190,398 | 1,028,240 | 778,337 | |
Travel and conferences | 112,360 | 518,140 | 246,418 | |
R&D consulting and material costs, net | 100,483 | 420,378 | 482,348 | |
Depreciation and amortization | 103,397 | 326,491 | 140,990 | |
Other expenses | 106,006 | 266,822 | 252,961 | |
Insurance | 0 | 236,150 | 154,931 | |
Transfer agent and listing fees | 0 | 94,885 | 110,769 | |
Royalty and license costs | 0 | 0 | 287,000 | |
M&A costs | 1,561,860 | 0 | 0 | |
Total expenses | 4,176,816 | 10,442,835 | 10,253,482 | |
Allocation to cost of sales: Employee benefits | (71,105) | (166,706) | (574,018) | |
Total operating expenses | $ 4,105,711 | $ 10,276,129 | $ 9,679,464 | $ 1,438,376 |
Depreciation and Amortization -
Depreciation and Amortization - Schedule of depreciation and amortization (Details) - CAD ($) | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2022 | Sep. 30, 2021 | |
Disclosure of attribution of expenses by nature to their function [line items] | |||
Depreciation and amortization | $ 103,397 | $ 326,491 | $ 140,990 |
General and administrative [Member] | |||
Disclosure of attribution of expenses by nature to their function [line items] | |||
Depreciation and amortization | 89,307 | 123,960 | 95,310 |
Selling and marketing [Member] | |||
Disclosure of attribution of expenses by nature to their function [line items] | |||
Depreciation and amortization | 0 | 129,265 | 16,443 |
Research and development [Member] | |||
Disclosure of attribution of expenses by nature to their function [line items] | |||
Depreciation and amortization | $ 14,090 | $ 73,266 | $ 29,237 |
Net finance costs - Schedule of
Net finance costs - Schedule of net finance costs (Details) - CAD ($) | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2019 | |
Interest expense from: | ||||
Unsecured loan | $ 0 | $ 321,313 | $ 4,527 | |
Accretion cost - accrued royalties liability | 0 | 159,451 | 64,537 | |
Lease obligations | 31,242 | 30,112 | 33,872 | |
Related party loans | 8,448 | 0 | 4,581 | |
CEBA term loan | 0 | 0 | 4,481 | |
2019 convertible notes | 44,899 | 0 | 0 | |
Other | 5,885 | 1,114 | 4,115 | |
Total interest expenses | 90,474 | 511,990 | 116,113 | |
Interest income | (2,454) | (5,988) | (4,848) | |
Gain on termination of lease obligations | (17,527) | 0 | 0 | |
Gain on government grant | (9,096) | 0 | (3,514) | |
Net finance costs | $ 61,397 | $ 506,002 | $ 107,751 | $ 245,147 |
Income taxes (Narrative) (Detai
Income taxes (Narrative) (Details) - CAD ($) | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2019 | |
Major components of tax expense (income) [abstract] | ||||
Applicable tax rate | 26.50% | 26.50% | 26.50% | 26.50% |
Recognized estimated investment tax credits | $ 127,325 |
Income taxes - Schedule of inco
Income taxes - Schedule of income tax recovery (Details) - CAD ($) | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2019 | |
Major components of tax expense (income) [abstract] | ||||
Current income tax recovery (expense): | $ 0 | $ 0 | $ 0 | $ 0 |
Deferred income tax (recovery) expense: | 0 | (49,442) | 0 | 0 |
Income tax recovery: | $ 0 | $ (49,442) | $ 0 | $ 0 |
Income taxes - Schedule of reco
Income taxes - Schedule of reconciliation of effective income tax rate (Details) - CAD ($) | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2019 | |
Major components of tax expense (income) [abstract] | ||||
Loss before income taxes | $ (3,536,778) | $ (10,569,732) | $ (9,315,372) | $ (1,147,280) |
Expected statutory tax rate | 26.50% | 26.50% | 26.50% | 26.50% |
Expected tax recovery resulting from loss | $ (937,246) | $ (2,800,979) | $ (2,468,574) | $ (304,029) |
Increase (reduction) in income taxes resulting from: | ||||
Non-deductible expenses | 275,273 | 563,842 | 654,956 | 28,115 |
Foreign operations subject to different tax rates | 0 | 5,329 | 3,593 | |
Unrecognized temporary differences | 661,973 | 2,182,366 | 1,826,279 | 275,914 |
Prior year differences | 0 | 0 | (16,254) | |
Total tax expense (recovery) | $ 0 | $ (49,442) | $ 0 | $ 0 |
Income taxes - Schedule of brea
Income taxes - Schedule of breakdown of research and development expenses (Details) - CAD ($) | 9 Months Ended | 12 Months Ended | |||
Sep. 30, 2020 | Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2019 | |
Major components of tax expense (income) [abstract] | |||||
R&D expenses | $ 2,064,493 | $ 2,369,145 | $ 944,909 | ||
Less: Investment tax credits | 0 | (231,007) | (127,325) | ||
R&D expenses, net | $ 817,584 | $ 2,064,493 | $ 2,138,138 | $ 817,584 | $ 1,003,705 |
Income taxes - Schedule of defe
Income taxes - Schedule of deferred tax assets (Details) - CAD ($) | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2022 | Sep. 30, 2021 | |
Disclosure of temporary difference, unused tax losses and unused tax credits [line items] | |||
Balance at beginning | $ 0 | $ 0 | $ 0 |
Arising on a business combination | 0 | (49,442) | 0 |
Recognized in profit or loss | 0 | 49,442 | 0 |
Balance at ending | 0 | 0 | 0 |
Net operating loss carryforwards [Member] | |||
Disclosure of temporary difference, unused tax losses and unused tax credits [line items] | |||
Balance at beginning | 0 | 0 | 48,045 |
Arising on a business combination | 48,045 | 0 | (48,045) |
Recognized in profit or loss | 0 | 26,459 | 0 |
Balance at ending | 48,045 | 26,459 | 0 |
Intangibles and development costs [Member] | |||
Disclosure of temporary difference, unused tax losses and unused tax credits [line items] | |||
Balance at beginning | 0 | 0 | (48,045) |
Arising on a business combination | (48,045) | (49,442) | |
Recognized in profit or loss | 22,983 | ||
Balance at ending | (48,045) | (26,459) | 0 |
Impairment provision [Member] | |||
Disclosure of temporary difference, unused tax losses and unused tax credits [line items] | |||
Balance at beginning | 0 | $ 0 | (48,045) |
Arising on a business combination | (48,045) | 48,045 | |
Recognized in profit or loss | 0 | 0 | |
Balance at ending | $ (48,045) | $ 0 |
Income taxes - Schedule of unre
Income taxes - Schedule of unrecognized deductible temporary differences (Details) - CAD ($) | Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2019 |
Disclosure of temporary difference, unused tax losses and unused tax credits [line items] | ||||
Net operating loss carryforwards | $ 18,589,894 | $ 9,429,436 | $ 4,279,494 | $ 2,111,531 |
Unrecognized deductible temporary differences | 22,126,741 | 13,915,334 | 6,040,859 | 2,321,858 |
Share issuance costs [Member] | ||||
Disclosure of temporary difference, unused tax losses and unused tax credits [line items] | ||||
Unrecognized deductible temporary differences | 1,298,783 | 1,810,927 | 1,496,239 | 17,281 |
Intangibles and development costs [Member] | ||||
Disclosure of temporary difference, unused tax losses and unused tax credits [line items] | ||||
Unrecognized deductible temporary differences | 608,705 | 780,607 | 0 | |
Scientific research and development expenditures [Member] | ||||
Disclosure of temporary difference, unused tax losses and unused tax credits [line items] | ||||
Unrecognized deductible temporary differences | 1,583,058 | 1,789,571 | 218,235 | 170,940 |
Other [Member] | ||||
Disclosure of temporary difference, unused tax losses and unused tax credits [line items] | ||||
Unrecognized deductible temporary differences | $ 46,300 | $ 104,793 | $ 46,891 | $ 22,106 |
Income taxes - Schedule of net
Income taxes - Schedule of net operating losses (Details) - CAD ($) | Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2019 |
Disclosure of temporary difference, unused tax losses and unused tax credits [line items] | ||||
Net operating losses | $ 18,589,894 | $ 9,429,436 | $ 4,279,494 | $ 2,111,531 |
Net operating losses in Canada [Member] | ||||
Disclosure of temporary difference, unused tax losses and unused tax credits [line items] | ||||
Net operating losses | 18,689,741 | 4,460,796 | ||
Net operating losses in Canada [Member] | 2036 [Member] | ||||
Disclosure of temporary difference, unused tax losses and unused tax credits [line items] | ||||
Net operating losses | 512,163 | 512,163 | ||
Net operating losses in Canada [Member] | 2037 [Member] | ||||
Disclosure of temporary difference, unused tax losses and unused tax credits [line items] | ||||
Net operating losses | 744,022 | 611,677 | ||
Net operating losses in Canada [Member] | 2038 [Member] | ||||
Disclosure of temporary difference, unused tax losses and unused tax credits [line items] | ||||
Net operating losses | 1,174,797 | 1,174,797 | ||
Net operating losses in Canada [Member] | 2039 [Member] | ||||
Disclosure of temporary difference, unused tax losses and unused tax credits [line items] | ||||
Net operating losses | 1,732,039 | 1,829,518 | ||
Net operating losses in Canada [Member] | 2040 and thereafter [Member] | ||||
Disclosure of temporary difference, unused tax losses and unused tax credits [line items] | ||||
Net operating losses | $ 14,526,720 | $ 332,641 |
Income taxes- Schedule of resea
Income taxes- Schedule of research and development investment tax credits (Details) - Research and development investment tax credits [Member] | 12 Months Ended |
Sep. 30, 2022 CAD ($) | |
Disclosure of temporary difference, unused tax losses and unused tax credits [line items] | |
Available research and development investment tax credits | $ 348,583 |
2037 [Member] | |
Disclosure of temporary difference, unused tax losses and unused tax credits [line items] | |
Available research and development investment tax credits | 13,361 |
2038 [Member] | |
Disclosure of temporary difference, unused tax losses and unused tax credits [line items] | |
Available research and development investment tax credits | 6,742 |
2039 [Member] | |
Disclosure of temporary difference, unused tax losses and unused tax credits [line items] | |
Available research and development investment tax credits | 0 |
2040 and thereafter [Member] | |
Disclosure of temporary difference, unused tax losses and unused tax credits [line items] | |
Available research and development investment tax credits | $ 328,480 |
Financial instruments (Narrativ
Financial instruments (Narrative) (Details) - CAD ($) | 9 Months Ended | 12 Months Ended | ||||
Sep. 30, 2020 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Disclosure of detailed information about financial instruments [abstract] | ||||||
Discount rate | 24% | 13.70% | ||||
Fair value for accrued royalties liability | $ 869,219 | $ 1,105,756 | ||||
Fair value of borrowings | 68,750 | 49,825 | ||||
Foreign exchange gain (loss) | $ (13,937) | 28,780 | (3,742) | $ (13,937) | $ (982) | |
Current trade receivables | 210,795 | 114,877 | 0 | 1,191 | ||
Trade receivables overdue by more than 60 days from law enforcement agencies | 53,233 | |||||
Cash | 3,073,760 | 170,545 | 2,688,105 | $ 3,073,760 | 21,615 | $ 0 |
Working capital (deficiency) | $ 2,900,000 | $ (5,409,487) | $ 2,900,000 | $ (300,000) |
Financial instruments - Schedul
Financial instruments - Schedule of net US dollar exposure (Details) | Sep. 30, 2022 CAD ($) | Sep. 30, 2022 USD ($) | Sep. 30, 2021 CAD ($) | Sep. 30, 2020 CAD ($) | Sep. 30, 2020 USD ($) | Dec. 31, 2019 CAD ($) |
Disclosure of detailed information about financial instruments [line items] | ||||||
Assets | $ 7,323,463 | $ 8,717,846 | $ 5,312,777 | $ 700,087 | ||
Liabilities | $ (8,326,354) | $ (2,594,118) | $ (1,427,913) | $ (931,483) | ||
U.S. subsidiary [Member] | ||||||
Disclosure of detailed information about financial instruments [line items] | ||||||
Net U.S. dollar exposure | $ 34,623 | |||||
U.S. dollar exposure [Member] | ||||||
Disclosure of detailed information about financial instruments [line items] | ||||||
Assets | 70,187 | $ 222,262 | ||||
Liabilities | (1,015,090) | (88,019) | ||||
Net U.S. dollar exposure | (979,526) | 134,243 | ||||
Impact to profit or loss if 5% movement in the US dollar | $ (48,976) | $ 6,712 |
Financial instruments - Sched_2
Financial instruments - Schedule of contractual obligations (Details) - CAD ($) | Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2019 |
Disclosure of maturity analysis for financial assets held for managing liquidity risk [line items] | ||||
Accounts payable and accrued liabilities | $ 4,459,481 | $ 1,127,202 | $ 818,274 | $ 198,687 |
Contractual obligations [Member] | ||||
Disclosure of maturity analysis for financial assets held for managing liquidity risk [line items] | ||||
Accounts payable and accrued liabilities | 4,459,481 | |||
Borrowings | 2,648,280 | |||
Minimum royalty commitments | 2,500,000 | |||
Lease obligations | 327,600 | |||
Total contractual obligations | 9,935,361 | |||
Contractual obligations [Member] | Within 1 Year [Member] | ||||
Disclosure of maturity analysis for financial assets held for managing liquidity risk [line items] | ||||
Accounts payable and accrued liabilities | 4,459,481 | |||
Borrowings | 2,548,280 | |||
Minimum royalty commitments | 150,000 | |||
Lease obligations | 93,600 | |||
Total contractual obligations | 7,251,361 | |||
Contractual obligations [Member] | 1 to 3 years [Member] | ||||
Disclosure of maturity analysis for financial assets held for managing liquidity risk [line items] | ||||
Accounts payable and accrued liabilities | 0 | |||
Borrowings | 100,000 | |||
Minimum royalty commitments | 350,000 | |||
Lease obligations | 187,200 | |||
Total contractual obligations | 637,200 | |||
Contractual obligations [Member] | 3 to 5 years [Member] | ||||
Disclosure of maturity analysis for financial assets held for managing liquidity risk [line items] | ||||
Accounts payable and accrued liabilities | 0 | |||
Borrowings | 0 | |||
Minimum royalty commitments | 2,000,000 | |||
Lease obligations | 46,800 | |||
Total contractual obligations | $ 2,046,800 |
Supplemental cash flow inform_3
Supplemental cash flow information (Narrative) (Details) - CAD ($) | 9 Months Ended | 12 Months Ended | |||
Sep. 30, 2020 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Supplemental Cash Flow Information [Abstract] | |||||
Fair value of contingent shares settled via common shares | $ 83,319 | ||||
Number of contingent shares settled via common shares | 875 | ||||
Shares issued to settle debt | $ 19,000 | ||||
Shares for debt settlements | $ 63,866 | ||||
Fair value of options exercised and transferred | $ 17,531 | 203,516 | $ 17,531 | ||
Fair value of warrants exercised | 61,173 | 102,991 | |||
Value of warrants exercised on assets acquisition | $ 125,000 | $ 125,000 | |||
Number of warrants exercised on assets acquisition | 250,000 | 250,000 | |||
Right-of-use asset and lease obligations relating to the new office lease | 358,178 | ||||
De-recognition of right-of-use asset | 139,787 | ||||
De-recognition of lease liability | 157,315 | ||||
Shares and warrants issued on assets acquisition | 347,280 | $ 592,822 | $ 1,715,000 | ||
Convertible notes converted into common shares | 255,718 | ||||
Share offering costs | 322,779 | ||||
Shares from foremost's qualifying transaction | $ 41,155 | ||||
Fair value of common shares issued for amended and restated license agreement | 137,000 | ||||
Share offering costs relating to Broker Compensation Options | 169,832 | ||||
Non-cash consideration for computer equipment acquired | $ 3,828 | ||||
Issue of common shares and warrants for loans | $ 1,290,255 |
Supplemental cash flow inform_4
Supplemental cash flow information - Schedule of non-cash working capital (Details) - CAD ($) | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2019 | |
Supplemental Cash Flow Information [Abstract] | ||||
Trade and other receivables | $ (257,588) | $ 631,801 | $ (218,334) | $ (41,465) |
Inventories | 0 | 49,446 | 17,555 | |
Prepaid expenses and other | (387,762) | 425,876 | (106,205) | (36,629) |
Other assets | 0 | (150,000) | ||
Accounts payable and accrued liabilities | 393,202 | 2,515,289 | (828,698) | 86,519 |
Contract liabilities | 7,053 | 17,410 | (7,053) | 0 |
Deposits | 0 | 0 | 150,000 | |
Accrued royalties liability | 0 | 0 | 1,191,219 | |
Changes in working capital | $ (245,095) | $ 3,639,822 | $ 198,484 | $ (141,575) |
Segmented information - Schedul
Segmented information - Schedule of geographical areas (Details) - CAD ($) | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2019 | |
Disclosure of geographical areas [line items] | ||||
Revenue | $ 861,917 | $ 721,519 | $ 1,275,804 | $ 509,148 |
United States [Member] | ||||
Disclosure of geographical areas [line items] | ||||
Revenue | 835,097 | 472,749 | ||
Canada [Member] | ||||
Disclosure of geographical areas [line items] | ||||
Revenue | $ 26,820 | $ 36,399 |
Capital management - Schedule o
Capital management - Schedule of capital management (Details) - CAD ($) | Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Dec. 31, 2018 |
Debt: | ||||||
Related party loans | $ 0 | $ 218,276 | $ 289,828 | $ 885,213 | ||
Borrowings | $ 2,278,774 | 53,251 | 32,273 | 0 | ||
Lease obligations | 275,621 | 307,909 | 352,037 | 202,686 | 280,053 | |
Convertible notes | 0 | 210,819 | ||||
Equity: | ||||||
Share capital | 19,496,640 | 17,215,068 | 9,374,563 | 2,284,353 | $ 2,284,353 | $ 200 |
Warrants | 1,959,796 | 1,848,389 | ||||
Contributed surplus | 3,551,330 | 2,458,211 | 583,878 | 21,050 | ||
Accumulated other comprehensive loss | (101,418) | (8,991) | ||||
Accumulated deficit | (25,909,239) | (15,388,949) | (6,073,577) | (2,536,799) | ||
Total Capital | $ 1,551,504 | $ 6,484,888 | $ 4,487,450 | $ 471,937 |
Commitments and contingencies_2
Commitments and contingencies (Narrative) (Details) - CAD ($) | 1 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||||||||||||||
Apr. 05, 2021 | Apr. 23, 2021 | May 31, 2020 | Nov. 18, 2019 | Mar. 31, 2020 | Dec. 31, 2020 | Dec. 31, 2024 | Nov. 18, 2024 | Dec. 31, 2023 | Nov. 18, 2023 | Dec. 31, 2022 | Nov. 18, 2022 | Dec. 31, 2021 | Nov. 18, 2021 | Sep. 30, 2021 | Nov. 18, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Disclosure of contingent liabilities [line items] | ||||||||||||||||||
Issued price per share | $ 31.5 | $ 66.67 | ||||||||||||||||
Fair value of common shares issued for amended and restated license agreement | $ 137,000 | |||||||||||||||||
AerialX Drone Solutions [Member] | Amended and restated licensing agreement [Member] | ||||||||||||||||||
Disclosure of contingent liabilities [line items] | ||||||||||||||||||
Number of shares issued | 1,429 | |||||||||||||||||
Number of additional shares to be issued upon achieving technical milestones | 1,429 | |||||||||||||||||
Number of additional shares to be issued upon achieving performance milestones | 4,286 | |||||||||||||||||
Issued price per share | $ 95.9 | |||||||||||||||||
Fair value of common shares issued for amended and restated license agreement | 137,000 | |||||||||||||||||
License cost | $ 137,000 | |||||||||||||||||
Minimum annual royalty payment | $ 500,000 | $ 400,000 | $ 300,000 | $ 200,000 | $ 150,000 | |||||||||||||
Payment of advanced royalty | $ 150,000 | |||||||||||||||||
AerialX Drone Solutions [Member] | Amended and restated licensing agreement [Member] | Bottom of range [Member] | ||||||||||||||||||
Disclosure of contingent liabilities [line items] | ||||||||||||||||||
Percentage of royalty on annual sales | 8% | |||||||||||||||||
AerialX Drone Solutions [Member] | Amended and restated licensing agreement [Member] | Top of range [Member] | ||||||||||||||||||
Disclosure of contingent liabilities [line items] | ||||||||||||||||||
Percentage of royalty on annual sales | 15% | |||||||||||||||||
Drone Bullet [Member] | Non-exclusive license agreement [Member] | ||||||||||||||||||
Disclosure of contingent liabilities [line items] | ||||||||||||||||||
Percentage of royalty on annual sales | 8% | |||||||||||||||||
Payment of advanced royalty | $ 150,000 | |||||||||||||||||
Drone Bullet [Member] | Non-exclusive license agreement [Member] | Subsequent events [Member] | ||||||||||||||||||
Disclosure of contingent liabilities [line items] | ||||||||||||||||||
Minimum annual royalty payment | $ 150,000 | $ 500,000 | $ 400,000 | $ 300,000 | $ 200,000 |
Commitments and contingencies -
Commitments and contingencies - Schedule of performance milestones (Details) - Amended and restated licensing agreement [Member] - Aerialx Technology [Member] $ in Millions | 12 Months Ended |
Sep. 30, 2022 CAD ($) shares | |
First milestone [Member] | |
Disclosure of contingent liabilities [line items] | |
Number of Common Shares | shares | 1,071 |
Milestone, amount in sales | $ | $ 3 |
Second milestone [Member] | |
Disclosure of contingent liabilities [line items] | |
Number of Common Shares | shares | 1,429 |
Milestone, amount in sales | $ | $ 9 |
Third milestone [Member] | |
Disclosure of contingent liabilities [line items] | |
Number of Common Shares | shares | 1,786 |
Milestone, amount in sales | $ | $ 18 |
Restatement of previously rep_3
Restatement of previously reported audited financial statements (Narrative) (Details) | 12 Months Ended |
Dec. 31, 2019 CAD ($) | |
Restatement Of Previously Reported Audited Financial Statements [Line Items] | |
Maximum royalty payments | $ 50,000 |
Non-current asset written off | 150,000 |
As previously reported [Member] | |
Restatement Of Previously Reported Audited Financial Statements [Line Items] | |
Payment of advanced royalty | $ 150,000 |
Restatement of previously rep_4
Restatement of previously reported audited financial statements - Schedule of consolidated statements of financial position (Details) - CAD ($) | Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
Statement of financial position [abstract] | |||||
Other assets | $ 150,000 | ||||
Non-current assets | $ 5,807,070 | $ 4,662,149 | $ 1,316,263 | 404,594 | |
Total assets | 7,323,463 | 8,717,846 | 5,312,777 | 700,087 | |
Deficit | (25,909,239) | (15,388,949) | (6,073,577) | (2,536,799) | |
Total shareholders' equity (deficit) | (1,002,891) | 6,123,728 | 3,884,864 | (231,396) | $ (1,389,319) |
Total liabilities and shareholders' equity (deficit) | $ 7,323,463 | $ 8,717,846 | 5,312,777 | 700,087 | |
As previously reported [Member] | |||||
Statement of financial position [abstract] | |||||
Other assets | 0 | ||||
Non-current assets | 254,594 | ||||
Total assets | 5,507,011 | 550,087 | |||
Deficit | (6,102,058) | (2,686,799) | |||
Total shareholders' equity (deficit) | 3,856,383 | (381,396) | |||
Total liabilities and shareholders' equity (deficit) | 550,087 | ||||
Adjustment [Member] | |||||
Statement of financial position [abstract] | |||||
Other assets | 150,000 | ||||
Non-current assets | 150,000 | ||||
Total assets | (194,234) | 150,000 | |||
Deficit | 28,481 | 150,000 | |||
Total shareholders' equity (deficit) | $ 28,481 | 150,000 | |||
Total liabilities and shareholders' equity (deficit) | $ 150,000 |
Restatement of previously rep_5
Restatement of previously reported audited financial statements - Schedule of consolidated statements of net loss and comprehensive loss (Details) - CAD ($) | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2019 | |
Profit or loss [abstract] | ||||
General and administrative | $ 2,723,861 | $ 4,915,263 | $ 4,057,167 | $ 397,990 |
Total operating expenses | 4,105,711 | 10,276,129 | 9,679,464 | 1,438,376 |
Operating loss | (3,490,907) | (10,091,345) | (9,202,548) | (1,014,329) |
Loss before income taxes | (3,536,778) | (10,569,732) | (9,315,372) | (1,147,280) |
Net loss and comprehensive loss | $ (3,536,778) | $ (10,612,717) | $ (9,324,363) | $ (1,147,280) |
Net loss per share | $ (8.03) | $ (14.41) | $ (14.72) | $ (4.61) |
As previously reported [Member] | ||||
Profit or loss [abstract] | ||||
General and administrative | $ 547,990 | |||
Total operating expenses | 1,588,376 | |||
Operating loss | (1,164,329) | |||
Loss before income taxes | (1,297,280) | |||
Net loss and comprehensive loss | $ (1,297,280) | |||
Net loss per share | $ (5.21) | |||
Adjustment [Member] | ||||
Profit or loss [abstract] | ||||
General and administrative | $ (150,000) | |||
Total operating expenses | (150,000) | |||
Operating loss | 150,000 | |||
Loss before income taxes | 150,000 | |||
Net loss and comprehensive loss | $ 150,000 | |||
Net loss per share | $ 150,000 |
Restatement of previously rep_6
Restatement of previously reported audited financial statements - Schedule of consolidated statements of cash flows (Details) - CAD ($) | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2019 | |
Statement of cash flows [abstract] | ||||
Net loss | $ (3,536,778) | $ (10,520,290) | $ (9,315,372) | $ (1,147,280) |
Changes in non-cash working capital items | $ (245,095) | $ 3,639,822 | $ 198,484 | (141,575) |
As previously reported [Member] | ||||
Statement of cash flows [abstract] | ||||
Net loss | (1,297,280) | |||
Changes in non-cash working capital items | 8,425 | |||
Adjustment [Member] | ||||
Statement of cash flows [abstract] | ||||
Net loss | 150,000 | |||
Changes in non-cash working capital items | $ (150,000) |
Subsequent Events (Narrative) (
Subsequent Events (Narrative) (Details) | 1 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||||||||||||||||||
Dec. 09, 2022 USD ($) $ / shares $ / Unit shares | Mar. 11, 2022 CAD ($) | Apr. 05, 2021 CAD ($) $ / shares shares | Dec. 31, 2022 CAD ($) | Dec. 31, 2022 USD ($) | Oct. 28, 2022 | Apr. 30, 2021 CAD ($) $ / Unit shares | Apr. 29, 2021 CAD ($) shares | Jan. 31, 2021 | Dec. 31, 2020 CAD ($) | May 31, 2020 CAD ($) $ / shares | Mar. 31, 2020 CAD ($) | Sep. 30, 2020 CAD ($) $ / shares shares | Dec. 13, 2022 CAD ($) shares | Dec. 13, 2022 USD ($) shares | Sep. 30, 2022 CAD ($) shares | Sep. 30, 2022 USD ($) | Sep. 30, 2021 CAD ($) shares | Dec. 31, 2019 CAD ($) shares | Dec. 31, 2018 CAD ($) $ / shares shares | Aug. 25, 2022 USD ($) | Sep. 17, 2020 shares | Sep. 30, 2019 CAD ($) shares | |
Disclosure of non-adjusting events after reporting period [line items] | |||||||||||||||||||||||
Description of reverse stock split | 1-for-70 Reverse Split | ||||||||||||||||||||||
Borrowings | $ 32,273 | $ 2,278,774 | $ 53,251 | $ 0 | |||||||||||||||||||
Maximum royalty payments | 50,000 | ||||||||||||||||||||||
Fair value of shares | $ 9,374,563 | $ 19,496,640 | $ 17,215,068 | $ 2,284,353 | $ 200 | $ 2,284,353 | |||||||||||||||||
Number of shares outstanding | shares | 589,518 | 773,225 | 699,511 | 383,996 | 3 | 589,517 | 383,996 | ||||||||||||||||
Issue price per share | $ / shares | $ 31.5 | $ 66.67 | |||||||||||||||||||||
Share offering costs | $ 58,065 | $ 45,283 | $ 699,886 | $ 33,880 | $ 606,622 | ||||||||||||||||||
Repayment of loan | $ 0 | 0 | 306,000 | $ 10,747 | |||||||||||||||||||
US public offering [Member] | |||||||||||||||||||||||
Disclosure of non-adjusting events after reporting period [line items] | |||||||||||||||||||||||
Number of units issued | shares | 2,500,000 | ||||||||||||||||||||||
Issue price per unit | $ / Unit | 4.13 | ||||||||||||||||||||||
Description of units issued | (the "Unit"), consisting of one share of common stock and one warrant to purchase one share of common stock ("Warrant") | ||||||||||||||||||||||
Exercise price of warrants issued | $ / shares | $ 5 | ||||||||||||||||||||||
Pre-funded common share purchase warrants issued | shares | 199,000 | ||||||||||||||||||||||
Warrants granted during period | shares | 375,000 | ||||||||||||||||||||||
Cash commission | $ 835,000 | ||||||||||||||||||||||
Percentage of gross proceeds offering | 7.50% | ||||||||||||||||||||||
Underwriter warrants granted | shares | 134,950 | ||||||||||||||||||||||
Underwriter warrants, percentage | 5% | ||||||||||||||||||||||
Issue price per share | $ / shares | $ 5.1625 | ||||||||||||||||||||||
Canadian offering [Member] | |||||||||||||||||||||||
Disclosure of non-adjusting events after reporting period [line items] | |||||||||||||||||||||||
Number of units issued | shares | 726,392 | ||||||||||||||||||||||
Issue price per unit | $ / Unit | 4.13 | ||||||||||||||||||||||
Description of common share purchase warrant | each consisting of one common share and one warrant to purchase one common share | ||||||||||||||||||||||
Exercise price of warrants issued | $ / shares | $ 5 | ||||||||||||||||||||||
Cash commission | $ 210,000 | ||||||||||||||||||||||
Percentage of gross proceeds offering | 7% | ||||||||||||||||||||||
Compensation options granted | shares | 50,848 | ||||||||||||||||||||||
Compensation options, percentage | 7% | ||||||||||||||||||||||
Issue price per share | $ / shares | $ 4.13 | ||||||||||||||||||||||
Brokered private placements [Member] | |||||||||||||||||||||||
Disclosure of non-adjusting events after reporting period [line items] | |||||||||||||||||||||||
Number of units issued | shares | 51,087 | ||||||||||||||||||||||
Description of units issued | Each April 2021 Warrant is exercisable to acquire 1/70 of a common share at a price of $1.75 each (70 warrants for one common share) for a period of 24 months from the closing of the April 2021 Offering ("Closing Date"). If at any time after four (4) months and one (1) day following the Closing Date, the trading price of KWESST common stock on the TSX Venture Exchange is equal to or exceeds $210.00 for a period of 10 consecutive trading days, as evidenced by the price at the close of market, we will be entitled to notify the holders of the April 2021 Warrants of its intention to force the exercise of the April 2021 Warrants. Upon receipt of such notice, the holders of April 2021 Warrants shall have 30 days to exercise the April 2021 Warrants, failing which the April 2021 Warrants will automatically expire. | ||||||||||||||||||||||
Issue price per share | $ / shares | $ 49.01 | ||||||||||||||||||||||
Share offering costs | $ 630,680 | ||||||||||||||||||||||
CEBA Term Loan program [Member] | |||||||||||||||||||||||
Disclosure of non-adjusting events after reporting period [line items] | |||||||||||||||||||||||
Amount of increase in loan | $ 20,000 | ||||||||||||||||||||||
Borrowings | $ 60,000 | ||||||||||||||||||||||
Period for interest free term loan | 2 years | ||||||||||||||||||||||
Description of repayment of term loan | The CEBA Term Loan may be repaid at any time without notice or the payment of any penalty. If 75% of the CEBA Term Loan is repaid on or before December 31, 2022, the repayment of the remaining 25% shall be forgiven. If on December 31, 2022, KWESST exercises the option for a 3-year term extension, a 5% annual interest will be applied on the any balance remaining during the extension period. | ||||||||||||||||||||||
Repayment of loan | $ 30,000 | ||||||||||||||||||||||
Low Energy Cartridge technology from DEFSEC [Member] | |||||||||||||||||||||||
Disclosure of non-adjusting events after reporting period [line items] | |||||||||||||||||||||||
Number of shares issued to acquire technology | shares | 14,286 | ||||||||||||||||||||||
Number of warrants issued to acquire technology | shares | 500,000 | ||||||||||||||||||||||
Description of exercise price for warrants issued | $0.70 per 1/70 of a common share | ||||||||||||||||||||||
Description of vesting percentage of warrants | 25% vesting on the first anniversary of the closing of the LEC Technology acquisition and 25% per annum thereafter. | ||||||||||||||||||||||
Percentage of royalty on annual sales | 7% | ||||||||||||||||||||||
Maximum royalty payments | $ 10,000,000 | ||||||||||||||||||||||
Amended and restated licensing agreement with AerialX [Member] | |||||||||||||||||||||||
Disclosure of non-adjusting events after reporting period [line items] | |||||||||||||||||||||||
Number of shares issued | shares | 1,429 | ||||||||||||||||||||||
Issue price per share | $ / shares | $ 95.9 | ||||||||||||||||||||||
Fair value of shares | $ 137,000 | ||||||||||||||||||||||
Subsequent events [Member] | |||||||||||||||||||||||
Disclosure of non-adjusting events after reporting period [line items] | |||||||||||||||||||||||
Gross proceeds from issuing units | $ 14,145,000 | ||||||||||||||||||||||
Fair value of shares | $ 9,374,563 | $ 17,215,068 | |||||||||||||||||||||
Number of shares outstanding | shares | 589,518 | 699,511 | |||||||||||||||||||||
Share offering costs | $ 2,300,000 | $ 839,679 | |||||||||||||||||||||
Share offering costs deferred | 628,262 | ||||||||||||||||||||||
Number of units issued to settle loan | shares | 56,141 | 56,141 | |||||||||||||||||||||
Subsequent events [Member] | Brokered private placements [Member] | |||||||||||||||||||||||
Disclosure of non-adjusting events after reporting period [line items] | |||||||||||||||||||||||
Number of units issued | shares | 51,087 | ||||||||||||||||||||||
Issue price per unit | $ / Unit | 87.5 | ||||||||||||||||||||||
Description of common share purchase warrant | Each issued unit is comprised of one common share of the Company and seventy common share purchase warrant. | ||||||||||||||||||||||
Gross proceeds from issuing units | $ 4,470,071 | ||||||||||||||||||||||
Description of exercise price for warrants issued | 1/70 of a common share at a price of $1.75 each | ||||||||||||||||||||||
Number of warrants per unit issued | shares | 70 | ||||||||||||||||||||||
March 2022 Loan [Member] | |||||||||||||||||||||||
Disclosure of non-adjusting events after reporting period [line items] | |||||||||||||||||||||||
Borrowings | $ 2,000,000 | $ 0 | 1,764,630 | 0 | |||||||||||||||||||
Share offering costs | $ 16,581 | ||||||||||||||||||||||
March 2022 Loan [Member] | Subsequent events [Member] | |||||||||||||||||||||||
Disclosure of non-adjusting events after reporting period [line items] | |||||||||||||||||||||||
Debt settled with issuance of units | $ 12,000 | ||||||||||||||||||||||
Repayment of loan | $ 1,997,435 | ||||||||||||||||||||||
August 2022 Loans [Member] | |||||||||||||||||||||||
Disclosure of non-adjusting events after reporting period [line items] | |||||||||||||||||||||||
Borrowings | $ 0 | $ 435,348 | $ 0 | $ 400,000 | |||||||||||||||||||
August 2022 Loans [Member] | Subsequent events [Member] | |||||||||||||||||||||||
Disclosure of non-adjusting events after reporting period [line items] | |||||||||||||||||||||||
Debt settled with issuance of units | $ 223,321 | ||||||||||||||||||||||
Repayment of loan | $ 223,321 |
Subsequent Events - Schedule of
Subsequent Events - Schedule of subsequent events (Details) $ in Millions | 1 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||||||
Sep. 30, 2021 CAD ($) shares | Apr. 30, 2021 CAD ($) | Sep. 17, 2020 shares | May 31, 2020 CAD ($) | Mar. 31, 2020 CAD ($) shares | Sep. 30, 2020 CAD ($) shares | Sep. 30, 2022 CAD ($) shares | Sep. 30, 2022 USD ($) shares | Sep. 30, 2021 CAD ($) shares | Dec. 31, 2019 CAD ($) shares | |
Disclosure of non-adjusting events after reporting period [line items] | ||||||||||
Beginning Balance (in shares) | shares | 383,996 | 383,996 | 699,511 | 699,511 | 589,518 | 3 | ||||
Outstanding amount, beginning of the period | $ 2,284,353 | $ 2,284,353 | $ 17,215,068 | $ 9,374,563 | $ 200 | |||||
Less: share offering costs for the year | $ (58,065) | $ (45,283) | $ (699,886) | $ (33,880) | $ (606,622) | |||||
Ending Balance (in shares) | shares | 699,511 | 589,517 | 589,518 | 773,225 | 773,225 | 699,511 | 383,996 | |||
Outstanding amount, end of the period | $ 17,215,068 | $ 9,374,563 | $ 19,496,640 | $ 17,215,068 | $ 2,284,353 | |||||
Brokered private placement [Member] | ||||||||||
Disclosure of non-adjusting events after reporting period [line items] | ||||||||||
Amount | 3,087,138 | 0 | 3,611,818 | |||||||
Less: share offering costs for the year | $ (630,680) | |||||||||
Exercise of stock options [Member] | ||||||||||
Disclosure of non-adjusting events after reporting period [line items] | ||||||||||
Amount | 78,080 | 0 | 1,292,015 | |||||||
Asset acquisition [Member] | ||||||||||
Disclosure of non-adjusting events after reporting period [line items] | ||||||||||
Amount | 167,280 | 0 | 1,290,000 | |||||||
Private placement [Member] | ||||||||||
Disclosure of non-adjusting events after reporting period [line items] | ||||||||||
Amount | 1,050,000 | $ 1,014,948 | ||||||||
Less: share offering costs for the year | $ (130,730) | |||||||||
Exercise of warrants [Member] | ||||||||||
Disclosure of non-adjusting events after reporting period [line items] | ||||||||||
Amount | 0 | 277,098 | 815,307 | |||||||
Exercise of broker compensation options [Member] | ||||||||||
Disclosure of non-adjusting events after reporting period [line items] | ||||||||||
Amount | 0 | 0 | 347,680 | |||||||
Amended license [Member] | ||||||||||
Disclosure of non-adjusting events after reporting period [line items] | ||||||||||
Amount | 0 | 0 | 137,000 | |||||||
Debt settlements [Member] | ||||||||||
Disclosure of non-adjusting events after reporting period [line items] | ||||||||||
Amount | $ 0 | $ 19,000 | $ 63,866 | |||||||
Subsequent Events [Member] | ||||||||||
Disclosure of non-adjusting events after reporting period [line items] | ||||||||||
Beginning Balance (in shares) | shares | 699,511 | 699,511 | 589,518 | |||||||
Outstanding amount, beginning of the period | $ 17,215,068 | $ 9,374,563 | ||||||||
Less: share offering costs for the year | $ (2.3) | $ (839,679) | ||||||||
Ending Balance (in shares) | shares | 699,511 | 589,518 | 699,511 | |||||||
Outstanding amount, end of the period | $ 17,215,068 | $ 9,374,563 | $ 17,215,068 | |||||||
Subsequent Events [Member] | Brokered private placement [Member] | ||||||||||
Disclosure of non-adjusting events after reporting period [line items] | ||||||||||
Issued common shares | shares | 51,087 | |||||||||
Amount | $ 3,611,818 | |||||||||
Subsequent Events [Member] | Exercise of stock options [Member] | ||||||||||
Disclosure of non-adjusting events after reporting period [line items] | ||||||||||
Issued common shares | shares | 18,195 | |||||||||
Amount | $ 1,292,015 | |||||||||
Subsequent Events [Member] | Asset acquisition [Member] | ||||||||||
Disclosure of non-adjusting events after reporting period [line items] | ||||||||||
Issued common shares | shares | 14,286 | |||||||||
Amount | $ 1,290,000 | |||||||||
Subsequent Events [Member] | Private placement [Member] | ||||||||||
Disclosure of non-adjusting events after reporting period [line items] | ||||||||||
Issued common shares | shares | 10,714 | |||||||||
Amount | $ 1,110,000 | |||||||||
Subsequent Events [Member] | Exercise of warrants [Member] | ||||||||||
Disclosure of non-adjusting events after reporting period [line items] | ||||||||||
Issued common shares | shares | 10,380 | |||||||||
Amount | $ 815,307 | |||||||||
Subsequent Events [Member] | Exercise of broker compensation options [Member] | ||||||||||
Disclosure of non-adjusting events after reporting period [line items] | ||||||||||
Issued common shares | shares | 2,459 | |||||||||
Amount | $ 347,680 | |||||||||
Subsequent Events [Member] | Amended license [Member] | ||||||||||
Disclosure of non-adjusting events after reporting period [line items] | ||||||||||
Issued common shares | shares | 1,429 | |||||||||
Amount | $ 137,000 | |||||||||
Subsequent Events [Member] | Debt settlements [Member] | ||||||||||
Disclosure of non-adjusting events after reporting period [line items] | ||||||||||
Issued common shares | shares | 1,305 | |||||||||
Amount | $ 63,866 | |||||||||
Subsequent Events [Member] | Share units [Member] | ||||||||||
Disclosure of non-adjusting events after reporting period [line items] | ||||||||||
Issued common shares | shares | 138 | |||||||||
Amount | $ 12,498 |