Document_And_Entity_Informatio
Document And Entity Information | 6 Months Ended | |
Oct. 31, 2013 | Dec. 13, 2013 | |
Document and Entity Information [Abstract] | ' | ' |
Entity Registrant Name | 'SPARTA COMMERCIAL SERVICES, INC. | ' |
Document Type | '10-Q | ' |
Current Fiscal Year End Date | '--04-30 | ' |
Entity Common Stock, Shares Outstanding | ' | 18,312,229 |
Amendment Flag | 'false | ' |
Entity Central Index Key | '0000318299 | ' |
Entity Current Reporting Status | 'Yes | ' |
Entity Voluntary Filers | 'No | ' |
Entity Filer Category | 'Smaller Reporting Company | ' |
Entity Well-known Seasoned Issuer | 'No | ' |
Document Period End Date | 31-Oct-13 | ' |
Document Fiscal Year Focus | '2014 | ' |
Document Fiscal Period Focus | 'Q2 | ' |
CONDENSED_CONSOLIDATED_BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (USD $) | Oct. 31, 2013 | Apr. 30, 2013 |
Current Assets | ' | ' |
Cash and cash equivalents | $19,170 | $38,213 |
Accounts receivable | 217,963 | 153,847 |
Total Current Assets | 237,133 | 192,060 |
Property and equipment, net of accumulated depreciation and amortization of $197,573 and $194,795, respectively (NOTE B) | 11,768 | 14,546 |
Goodwill | 10,000 | 10,000 |
Other assets | 47,203 | 57,907 |
Deposits | 40,568 | 40,568 |
Total assets from continuing operations | 346,672 | 315,081 |
Assets from discontinued operations (NOTE C) | 91,050 | 109,669 |
Total assets | 437,722 | 424,750 |
Current Liabilities | ' | ' |
Accounts payable and accrued expenses | 1,251,340 | 1,333,187 |
Notes payable net of beneficial conversion feature of $178,024 and $105,029, respectively (NOTE D) | 2,168,439 | 2,004,475 |
Loans payable-related parties (NOTE E) | 385,853 | 393,260 |
Derivative liabilities | 529,190 | 378,802 |
Total current liabilities from continuing operations | 4,334,822 | 4,109,724 |
Liabilities from discontinued operations (NOTE C) | 161,904 | 189,720 |
Total liabilities | 4,496,726 | 4,299,444 |
Deficit: | ' | ' |
Common stock, $0.001 par value; 740,000,000 shares authorized, 17,388,205 and 14,131,242 shares issued and outstanding, respectively | 17,388 | 14,131 |
Common stock to be issued, 111,080 and 625,340, respectively | 111 | 625 |
Preferred stock B to be issued, 64.8 and 56.8 shares, respectively | 65 | 57 |
Additional paid-in-capital | 39,561,169 | 38,483,198 |
Subscriptions receivable | -2,118,309 | -2,118,309 |
Accumulated deficit | -42,228,720 | -40,991,658 |
Total deficiency in stockholders' equity | -4,754,226 | -4,597,885 |
Noncontrolling interest | 695,223 | 723,191 |
Total Deficit | -4,059,003 | -3,874,694 |
Total Liabilities and Deficit | 437,722 | 424,750 |
Series A Preferred Stock [Member] | ' | ' |
Deficit: | ' | ' |
Preferred shares, value, issued | 12,500 | 12,500 |
Series B Preferred Stock [Member] | ' | ' |
Deficit: | ' | ' |
Preferred shares, value, issued | 1,570 | 1,570 |
Series C Preferred Stock [Member] | ' | ' |
Deficit: | ' | ' |
Preferred shares, value, issued | $0 | $0 |
CONDENSED_CONSOLIDATED_BALANCE1
CONDENSED CONSOLIDATED BALANCE SHEETS (Parentheticals) (USD $) | Oct. 31, 2013 | Apr. 30, 2013 |
Accumulated depreciation and amortization (in Dollars) | $197,573 | $194,795 |
Beneficial Conversion Feature (in Dollars) | 178,024 | 105,029 |
Preferred stock, par value (in Dollars per share) | $0.00 | $0.00 |
Preferred stock, shares designated (in Shares) | 10,000,000 | 10,000,000 |
Common stock par value (in Dollars per share) | $0.00 | $0.00 |
Common stock, shares authorized (in Shares) | 740,000,000 | 740,000,000 |
Common stock, shares issued (in Shares) | 17,388,205 | 14,131,242 |
Common stock, shares outstanding (in Shares) | 17,388,205 | 14,131,242 |
Common stock to be issued (in Shares) | 111,080 | 625,340 |
Preferred Stock, Shares to be Issued (in Shares) | 64.8 | 56.8 |
Series A Preferred Stock [Member] | ' | ' |
Preferred stock, par value (in Dollars per share) | $100 | $100 |
Preferred stock, shares designated (in Shares) | 35,850 | 35,850 |
Preferred stock, shares issued (in Shares) | 125 | 125 |
Preferred stock, shares outstanding (in Shares) | 125 | 125 |
Series B Preferred Stock [Member] | ' | ' |
Preferred stock, par value (in Dollars per share) | $0.00 | $0.00 |
Preferred stock, shares designated (in Shares) | 1,000 | 1,000 |
Preferred stock, shares issued (in Shares) | 157 | 157 |
Preferred stock, shares outstanding (in Shares) | 157 | 157 |
Preferred stock, redemption value (in Dollars) | 10,000 | 10,000 |
Preferred Stock, Shares to be Issued (in Shares) | 64.8 | 56.78 |
Series C Preferred Stock [Member] | ' | ' |
Preferred stock, par value (in Dollars per share) | $0.00 | $0.00 |
Preferred stock, shares designated (in Shares) | 200,000 | 200,000 |
Preferred stock, shares issued (in Shares) | 0 | 0 |
Preferred stock, shares outstanding (in Shares) | 0 | 0 |
Preferred stock, redemption value (in Dollars) | $10 | $10 |
CONDENSED_CONSOLIDATED_STATEME
CONDENSED CONSOLIDATED STATEMENTS OF LOSSES (UNAUDITED) (USD $) | 3 Months Ended | 6 Months Ended | ||
Oct. 31, 2013 | Oct. 31, 2012 | Oct. 31, 2013 | Oct. 31, 2012 | |
Revenue | ' | ' | ' | ' |
Information technology | $118,047 | $100,676 | $254,164 | $211,040 |
Cost of goods sold | 38,715 | 33,949 | 76,291 | 68,562 |
Gross profit | 79,333 | 66,727 | 177,872 | 142,478 |
Operating expenses: | ' | ' | ' | ' |
General and administrative | 363,382 | 351,181 | 711,829 | 881,535 |
Depreciation and amortization | 357 | 1,684 | 2,778 | 4,177 |
Total operating expenses | 363,739 | 352,865 | 714,607 | 885,712 |
Operating loss from continuing operations | -284,406 | -286,137 | -536,735 | -743,234 |
Other (income) expense: | ' | ' | ' | ' |
Other income | -17,691 | -33,422 | -38,195 | -50,590 |
Interest expense and financing cost, net | 73,620 | 127,384 | 159,249 | 186,334 |
Non-cash financing costs | 14,468 | 149,012 | 26,872 | 196,447 |
Amortization of debt discount | 120,451 | 205,087 | 195,942 | 377,296 |
(Gain) loss in changes in fair value of derivative liability | -27,403 | -141,604 | 26,720 | -113,106 |
Total other expense | 163,444 | 306,457 | 370,586 | 596,381 |
Net loss from continuing operations | -447,850 | -592,595 | -907,321 | -1,339,615 |
Net loss from discontinued operations | -267,992 | -256,539 | -278,613 | -531,806 |
Net Loss | -715,843 | -849,134 | -1,185,934 | -1,871,421 |
Net loss attributed to non-controlling interest | 18,304 | 9,700 | 27,969 | 9,771 |
Preferred dividend | -39,764 | -39,764 | -79,097 | -79,527 |
Net loss attributed to common stockholders | ($737,302) | ($879,198) | ($1,237,063) | ($1,941,177) |
Basic and diluted loss per share (in Dollars per share) | ($0.03) | ($0.06) | ($0.06) | ($0.13) |
Basic and diluted loss per share attributed to common stockholders (in Dollars per share) | ($0.05) | ($0.09) | ($0.08) | ($0.19) |
Weighted average shares outstanding (in Shares) | 15,823,610 | 10,144,853 | 15,994,720 | 10,004,344 |
CONDENSED_CONSOLIDATED_STATEME1
CONDENSED CONSOLIDATED STATEMENT OF EQUITY (UNAUDITED) (USD $) | Series A Preferred Stock [Member] | Series B Preferred Stock [Member] | Preferred Stock To Be Issued [Member] | Common Stock [Member] | Common Stock To Be Issued | Receivables from Stockholder [Member] | Additional Paid-in Capital [Member] | Retained Earnings [Member] | Noncontrolling Interest [Member] | Total |
Balance at Apr. 30, 2013 | $12,500 | $1,570 | $14,131,242 | $625,340 | ($2,118,309) | $38,483,198 | ($40,991,658) | $723,191 | ($3,874,684) | ($3,874,694) |
Balance (in Shares) at Apr. 30, 2013 | 125 | 157 | 57 | 14,131 | 625 | ' | ' | ' | ' | ' |
Correcting | ' | ' | -40 | -87,600 | ' | 16 | ' | ' | -71 | ' |
Correcting (in Shares) | ' | ' | ' | ' | -88 | ' | ' | ' | ' | ' |
Preferred dividend to be issued | ' | ' | ' | ' | ' | 78,707 | ' | ' | 78,715 | ' |
Preferred dividend to be issued (in Shares) | ' | ' | 8 | ' | ' | ' | ' | ' | ' | 64.8 |
Derivative liability reclassification | ' | ' | ' | ' | ' | 130,269 | ' | ' | 130,269 | ' |
Sale of common stock | ' | ' | 2,014,176 | -127,490 | ' | 511,276 | ' | ' | 513,163 | ' |
Sale of common stock (in Shares) | ' | ' | ' | 2,014 | -128 | ' | ' | ' | ' | ' |
Shares issued for financing cost | ' | ' | 71,402 | ' | ' | 26,801 | ' | ' | 26,872 | ' |
Shares issued for financing cost (in Shares) | ' | ' | ' | 71 | ' | ' | ' | ' | ' | ' |
Shares issued for conversion of notes and interest | ' | ' | 800,863 | -299,170 | ' | 212,236 | ' | ' | 212,738 | ' |
Shares issued for conversion of notes and interest (in Shares) | ' | ' | ' | 801 | -300 | ' | ' | ' | ' | ' |
Stock compensation | ' | ' | 370,562 | ' | ' | 111,987 | ' | ' | 112,358 | ' |
Stock compensation (in Shares) | ' | ' | ' | 371 | ' | ' | ' | ' | ' | ' |
Employee options expense | ' | ' | ' | ' | ' | 6,678 | ' | ' | 6,678 | ' |
Net loss | ' | ' | ' | ' | ' | ' | -1,237,063 | -27,969 | -1,265,031 | ' |
Balance at Oct. 31, 2013 | $12,500 | $1,570 | $17,388,205 | $111,080 | ($2,118,309) | $39,561,169 | ($42,228,720) | $695,223 | ($4,059,003) | ($4,059,003) |
Balance (in Shares) at Oct. 31, 2013 | 125 | 157 | 65 | 17,388 | 111 | ' | ' | ' | ' | ' |
CONDENSED_CONSOLIDATED_STATEME2
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (USD $) | 6 Months Ended | |
Oct. 31, 2013 | Oct. 31, 2012 | |
CASH FLOWS FROM OPERATING ACTIVITIES | ' | ' |
Net Loss | ($1,237,063) | ($1,941,177) |
Adjustments to reconcile net loss to net cash used in operating activities: | ' | ' |
Adjustment for reverse split | -71 | -462 |
Dividend on preferred stock | 79,097 | 79,527 |
Loss (gain) allocable to non-controlling interest | -27,969 | -9,771 |
Depreciation and amortization | 2,778 | 4,177 |
Amortization of debt discount | 195,942 | 377,296 |
Change in fair value of derivative liabilities | 26,720 | -113,106 |
Shares issued for debt and finance cost | 26,872 | 196,447 |
Equity based compensation | 119,037 | 428,174 |
(Increase) decrease in operating assets: | ' | ' |
Accounts receivable | -64,117 | -27,590 |
Prepaid expenses and other assets | 0 | 0 |
Restricted cash | 0 | 54,937 |
Other assets | 10,705 | -44,473 |
Increase (decrease) in operating liabilities: | ' | ' |
Accounts payable and accrued expenses | 4,707 | 256,766 |
Net cash used in operating activities | -863,363 | -739,255 |
CASH FLOWS FROM INVESTING ACTIVITIES: | ' | ' |
Net cash provided by investing activities | 0 | 0 |
CASH FLOWS FROM FINANCING ACTIVITIES | ' | ' |
Net proceeds from sale of subsidiary stock | 0 | 55,000 |
Net proceeds from sale of common stock | 513,161 | 455,211 |
Net proceeds from convertible notes | 460,263 | 193,500 |
Net payments on notes payable | -137,500 | -27,125 |
Net proceeds from other notes | 25,000 | 0 |
Net (payment of) loan proceeds from other related parties | -7,407 | 6,500 |
Net cash provided by financing activities | 853,517 | 683,086 |
Cash flows from discontinued operations: | ' | ' |
Cash (used in) provided by operating activities of discontinued operations | -9,197 | 28,599 |
Cash provided by investing activities of discontinued operations | 0 | 350,684 |
Cash (used in) financing activities of discontinued operations | 0 | -322,952 |
Net Cash flow from discontinued operation | -9,197 | 56,331 |
Net (decrease ) increase in cash | -19,043 | 162 |
Unrestricted cash and cash equivalents, beginning of period | 38,213 | 19,138 |
Unrestricted cash and cash equivalents , end of period | 19,170 | 19,300 |
Cash paid for: | ' | ' |
Interest | 10,807 | 65,954 |
Income taxes | $3,664 | $2,052 |
NOTE_A_SUMMARY_OF_ACCOUNTING_P
NOTE A - SUMMARY OF ACCOUNTING POLICIES | 6 Months Ended | |
Oct. 31, 2013 | ||
Accounting Policies [Abstract] | ' | |
Significant Accounting Policies [Text Block] | ' | |
NOTE A – SUMMARY OF ACCOUNTING POLICIES | ||
A summary of the significant accounting policies applied in the preparation of the accompanying financial statements follows. | ||
Basis of Presentation | ||
The accompanying unaudited condensed consolidated financial statements as of October 31, 2013 and for the three and six month periods ended October 31, 2013 and 2012 have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission, including Form 10-Q and Regulation S-K. The information furnished herein reflects all adjustments (consisting of normal recurring accruals and adjustments), which are, in the opinion of management, necessary to fairly present the operating results for the respective periods. Certain information and footnote disclosures normally present in annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been omitted pursuant to such rules and regulations. The Company believes that the disclosures provided are adequate to make the information presented not misleading. These financial statements should be read in conjunction with the audited financial statements and explanatory notes for the year ended April 30, 2013 as disclosed in the Company’s Form 10-K for that year as filed with the Securities and Exchange Commission. | ||
The unaudited condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiary, Specialty Reports, Inc. All significant inter-company transactions and balances have been eliminated in consolidation. | ||
Business | ||
Sparta Commercial Services, Inc. (“Sparta” “we,” “us,” or the “Company”), since May 2010, has concentrated its efforts on developing and marketing vehicle history reports, over the internet, and mobile apps for vehicle dealers and other market segments. Historically, the Company had been in the business as an originator and indirect lender for consumer retail installment loans and consumer lease financing for the purchase or lease of new and used motorcycles (specifically 550cc and higher) and utility-oriented 4-stroke all-terrain vehicles (ATVs). These consumer financing products were discontinued during the fiscal year ending April 30, 2013 (see NOTE C “Discontinued Operations”). The Company continues to offer a leasing program for municipalities. | ||
The results of operations for the six months ended October 31, 2013 are not necessarily indicative of the results to be expected for any other interim period or the full year ending April 30, 2014. | ||
Estimates | ||
The preparation of the financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results could differ from those estimates. | ||
Discontinued Operations | ||
As discussed in NOTE C, in the second quarter of fiscal 2013, the Company’s Board of Directors approved management’s recommendation to discontinue the Company’s consumer lease and loan lines of business and the sale of all of the Company’s portfolio of performing RISCs, and a portion of its portfolio of leases. The sale was consummated in that quarter. The assets and liabilities have been accounted for as discontinued operations in the Company’s consolidated balance sheets for all periods presented. The operating results related to these lines of business have been included in discontinued operations in the Company’s consolidated statements of loss for all periods presented. | ||
Revenue Recognition | ||
Revenues from history report and mobile app products are recognized on a cash basis. | ||
The Company’s leases, which are included in Discontinued Operations, are accounted for as either operating leases or direct financing leases. At the inception of operating leases, no lease revenue is recognized and the leased motorcycles, together with the initial direct costs of originating the lease, which are capitalized, appear on the balance sheet as “motorcycles under operating leases-net”. The capitalized cost of each motorcycle is depreciated over the lease term, on a straight-line basis, down to the Company’s original estimate of the projected value of the motorcycle at the end of the scheduled lease term (the “Residual”). Monthly lease payments are recognized as rental income. | ||
Direct financing leases are recorded at the gross amount of the lease receivable (principal amount of the contract plus the calculated earned income over the life of the contract), and the unearned income at lease inception is amortized over the lease term. | ||
The Company’s Retail Installment Sales Contracts (“RISC”), which are included in Discontinued Operations, are secured by liens on the titles to the vehicles. The RISCs are accounted for as loans. Upon purchase, the RISCs appear on the Company’s balance sheet as RISC loan receivable current and long term. Interest income on these loans is recognized when it is earned. | ||
The Company realizes gains and losses as the result of the termination of leases, both at and prior to their scheduled termination, and the disposition of the related motorcycle. The disposal of motorcycles, which reach scheduled termination of a lease, results in a gain or loss equal to the difference between proceeds received from the disposition of the motorcycle and its net book value. Net book value represents the residual value at scheduled lease termination. Lease terminations that occur prior to scheduled maturity as a result of the lessee’s voluntary request to purchase the vehicle have resulted in net gains, equal to the excess of the price received over the motorcycle’s net book value. | ||
Early lease terminations also occur because of (i) a default by the lessee, (ii) the physical loss of the motorcycle, or (iii) the exercise of the lessee’s early termination. In those instances, the Company receives the proceeds from either the resale or release of the repossessed motorcycle, or the payment by the lessee’s insurer. The Company records a gain or loss for the difference between the proceeds received and the net book value of the motorcycle. | ||
Inventories | ||
Inventories are valued at the lower of cost or market, with cost determined using the first-in, first-out method and with market defined as the lower of replacement cost or realizable value. | ||
Website Development Costs | ||
The Company recognizes website development costs in accordance with Accounting Standards Codification (“ASC”) 350-50, "Accounting for Website Development Costs." As such, the Company expenses all costs incurred that relate to the planning and post implementation phases of development of its website. Direct costs incurred in the development phase are capitalized and recognized over the estimated useful life. Costs associated with repair or maintenance for the website are included in cost of net revenues in the current period expenses. | ||
Cash Equivalents | ||
For the purpose of the accompanying financial statements, all highly liquid investments with a maturity of three months or less are considered to be cash equivalents. | ||
Income Taxes | ||
Deferred income taxes are provided using the asset and liability method for financial reporting purposes in accordance with the provisions of ASC 740-10, "Accounting for Income Taxes (“ASC 740-10”)." Under this method, deferred tax assets and liabilities are recognized for temporary differences between the tax bases of assets and liabilities and their carrying values for financial reporting purposes and for operating loss and tax credit carry forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be removed or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the statements of operations in the period that includes the enactment date. | ||
ASC 740-10, “Accounting for Uncertainty in Income Taxes” prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. ASC 740 also provides guidance on derecognition, classification, treatment of interest and penalties, and disclosure of such positions. As a result of implementing ASC 740, there has been no adjustment to the Company’s financial statements and the adoption of ASC 740 did not have a material effect on the Company’s consolidated financial statements for the year ending April 30, 2013 or the three months or six months ended October 31, 2013. | ||
Fair Value Measurements | ||
The Company adopted ASC 820, “Fair Value Measurements (“ASC 820”).” ASC 820 establishes a three-level fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets the lowest priority to unobservable inputs to fair value measurements of certain assets and Liabilities. The three levels of the fair value hierarchy under ASC 820 are described below: | ||
· | Level 1 — Quoted prices for identical instruments in active markets. Level 1 assets and liabilities include debt and equity securities and derivative contracts that are traded in an active exchange market, as well as certain securities that are highly liquid and are actively traded in over-the-counter markets. | |
· | Level 2 — Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model derived valuations in which all significant inputs and significant value drivers are observable in active markets. | |
· | Level 3 — Unobservable inputs that are supported by little or no market activity and that are significant to the fair value measurements. Level 3 assets and liabilities include financial instruments whose value is determined using pricing models, discounted cash flow methodologies, or similar techniques based on significant unobservable inputs, as well as management judgments or estimates that are significant to valuation. | |
This hierarchy requires the Company to use observable market data, when available, and to minimize the use of unobservable inputs when determining fair value. For some products or in certain market conditions, observable inputs may not always be available. | ||
Impairment of Long-Lived Assets | ||
In accordance ASC 360-10, “Impairment or Disposal of Long-Lived Assets,” long-lived assets, such as property, equipment, motorcycles and other vehicles and purchased intangible assets subject to amortization are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable. Recoverability of assets to be held and used is measured by comparing the carrying amount of an asset to estimated undiscounted future cash flows expected to be generated by the asset. If the carrying amount of an asset exceeds its estimated future cash flows or quoted market prices in active markets if available, an impairment charge is recognized by the amount by which the carrying amount of the asset exceeds the fair value of the asset. | ||
Comprehensive Income | ||
In accordance with ASC 220-10, “Reporting Comprehensive Income,” (“ASC 220-10”) establishes standards for reporting and displaying of comprehensive income, its components and accumulated balances. Comprehensive income is defined to include all changes in equity except those resulting from investments by owners and distributions to owners. Among other disclosures, ASC 220-10 requires that all items that are required to be recognized under current accounting standards as components of comprehensive income be reported in a financial statement that is displayed with the same prominence as other financial statements. At October 31, 2013 and April 30, 2013, the Company has no items of other comprehensive income. | ||
Segment Information | ||
The Company adopted ASC 280-10 “Disclosures about Segments of an Enterprise and Related Information.” ASC 280-10 establishes standards for reporting information regarding operating segments in annual financial statements and requires selected information for those segments to be presented in consolidated financial reports issued to stockholders. ASC 280-10 also establishes standards for related disclosures about products and services and geographic areas. Operating segments are identified as components of an enterprise about which separate discrete financial information is available for evaluation by the chief operating decision maker, or decision making group, in making decisions how to allocate resources and assess performance. The information disclosed herein, materially represents all of the financial information related to the Company's principal operating segments. | ||
In the second quarter of fiscal 2013, the Company’s Board of Directors approved management’s recommendation to discontinue the Company’s consumer lease and loan lines of business and the sale of all of the Company’s portfolio of performing RISCs and a portion of its portfolio of leases. The sale was consummated in that quarter. The assets and liabilities have been accounted for as discontinued operations in the Company’s consolidated balance sheets for all periods presented. The operating results related to these lines of business have been included in discontinued operations in the Company’s consolidated statements of loss for all periods presented. As these lines of business were discontinued during the fiscal year ending April 30, 2013, the Company has discontinued segment reporting. | ||
Stock Based Compensation | ||
The Company adopted ASC 718-10, which records compensation expense on a straight-line basis, generally over the explicit service period of three to five years. | ||
ASC 718-10 requires companies to estimate the fair value of share-based payment awards on the date of grant using an option-pricing model. The value of the portion of the award that is ultimately expected to vest is recognized as expense over the requisite service periods in the Company’s Consolidated Statement of Operations. The Company is using the Black-Scholes option-pricing model as its method of valuation for share-based awards. The Company’s determination of fair value of share-based payment awards on the date of grant using an option-pricing model is affected by the Company’s stock price as well as assumptions regarding a number of highly complex and subjective variables. These variables include, but are not limited to the Company’s expected stock price volatility over the term of the awards, and certain other market variables such as the risk free interest rate. | ||
Concentrations of Credit Risk | ||
Financial instruments and related items, which potentially subject the Company to concentrations of credit risk, consist primarily of cash, cash equivalents and receivables. The Company places its cash and temporary cash investments with high credit quality institutions. At times, such investments may be in excess of the FDIC insurance limit. | ||
Property and Equipment | ||
Property and equipment are recorded at cost. Minor additions and renewals are expensed in the year incurred. Major additions and renewals are capitalized and depreciated over their estimated useful lives. Depreciation is calculated using the straight-line method over the estimated useful lives. Estimated useful lives of major depreciable assets are as follows: | ||
Leasehold improvements | 3 years | |
Furniture and fixtures | 7 years | |
Website costs | 3 years | |
Computer Equipment | 5 years | |
Advertising Costs | ||
The Company follows a policy of charging the costs of advertising to expenses incurred. During the six months ended October 31, 2013 and 2012, the Company incurred advertising costs of $8,500 and $3,000, respectively. During the three months ended October 31, 2013 and 2012, the Company incurred advertising expenses of $4,250 and $1,500, respectively. | ||
Net Loss Per Share | ||
The Company uses ASC 260-10, “Earnings Per Share,” for calculating the basic and diluted loss per share. The Company computes basic loss per share by dividing net loss and net loss attributable to common shareholders by the weighted average number of common shares outstanding. Common equivalent shares are excluded from the computation of net loss per share if their effect is anti-dilutive. | ||
Per share basic and diluted net loss attributable to common stockholders amounted to $0.05 and $0.09 for the three months ended October 31, 2013 and 2012, respectively, and $0.08 and $0.19 for the six months ended October 31, 2013 and 2012, respectively. At October 31, 2013 and 2012, 5,586,766 and 4,076,101 potential shares, respectively, were excluded from the shares used to calculate diluted earnings per share as their inclusion would reduce net loss per share. | ||
Liquidity | ||
As shown in the accompanying unaudited, condensed consolidated financial statements, the Company has incurred a net loss attributed to common stockholders of $1,237,063 and $1,941,177 during the six months ended October 31, 2013 and October 31, 2012, respectively. The Company’s liabilities exceed its assets by $4,059,003 as of October 31, 2013. | ||
Reclassifications | ||
Certain reclassifications have been made to conform to prior periods' data to the current presentation. These reclassifications had no effect on reported losses. | ||
Recent Accounting Pronouncements | ||
There were various updates recently issued, most of which represented technical corrections to the accounting literature or applications to specific industries and are not expected to have a material impact on the Company’s unaudited condensed consolidated financial position, results of operations or cash flows. | ||
NOTE_B_PROPERTY_AND_EQUIPMENT
NOTE B - PROPERTY AND EQUIPMENT | 6 Months Ended | ||||||||
Oct. 31, 2013 | |||||||||
Property, Plant and Equipment [Abstract] | ' | ||||||||
Property, Plant and Equipment Disclosure [Text Block] | ' | ||||||||
NOTE B – PROPERTY AND EQUIPMENT | |||||||||
Major classes of property and equipment at October 31, 2013 and April 30, 2013 consist of the followings: | |||||||||
October 31, | April 30, | ||||||||
2013 | 2013 | ||||||||
Computer equipment, software and furniture | $ | 209,341 | $ | 209,341 | |||||
Less: accumulated depreciation | (197,573 | ) | (194,795 | ) | |||||
Net property and equipment | $ | 11,768 | $ | 14,546 | |||||
Depreciation expense of continuing operations for property and equipment was $2,778 and $4,177, respectively for the six months ended October 31, 2013 and 2012 and $357 and $1,684, respectively for the three months ended October 31, 2013 and 2012. | |||||||||
NOTE_C_DISCONTINUED_OPERATIONS
NOTE C - DISCONTINUED OPERATIONS | 6 Months Ended | ||||||||
Oct. 31, 2013 | |||||||||
Discontinued Operations and Disposal Groups [Abstract] | ' | ||||||||
Disposal Groups, Including Discontinued Operations, Disclosure [Text Block] | ' | ||||||||
NOTE C – DISCONTINUED OPERATIONS | |||||||||
In the second quarter of fiscal 2013, the Company’s Board of Directors approved management’s recommendation to discontinue the Company’s consumer lease and loan lines of business and the sale of all of the Company’s portfolio of performing RISCs and a portion of its portfolio of leases. The sale was consummated in that quarter. The assets and liabilities have been accounted for as discontinued operations in the Company’s consolidated balance sheets for all periods presented. | |||||||||
The operating results related to these lines of business have been included in discontinued operations in the Company’s consolidated statements of loss for all periods presented. The following table presents summarized operating results for those discontinued operations. | |||||||||
Six Months Ended | |||||||||
October 31, | October 31, | ||||||||
2013 | 2012 | ||||||||
Revenues | $ | 58,997 | $ | 134,571 | |||||
Net (loss) | $ | (278,613 | ) | $ | (531,806 | ) | |||
As the Company sold all of its portfolio of performing RISCs, and a portion of its portfolio of leases with the remaining leases in final run-off mode, therefore there no portfolio performance measures were calculated for the six months ended October 31, 3013 or the year ending April 30, 2013. | |||||||||
ASSETS INCLUDED IN DISCONTINUED OPERATIONS | |||||||||
MOTORCYCLES AND OTHER VEHICLES UNDER OPERATING LEASES | |||||||||
Motorcycles and other vehicles under operating leases at October 31, 2013 and April 30, 2013: | |||||||||
October 31, | April 30, | ||||||||
2013 | 2013 | ||||||||
Motorcycles and other vehicles | $ | 110,955 | $ | 152,157 | |||||
Less: accumulated depreciation | (25,241 | ) | (36,687 | ) | |||||
Motorcycles and other vehicles, net of accumulated depreciation | 85,714 | 115,470 | |||||||
Less: estimated reserve for residual values | (8,991 | ) | (8,880 | ) | |||||
Motorcycles and other vehicles under operating leases, net | $ | 76,723 | $ | 106,591 | |||||
At April 30, 2013, motorcycles and other vehicles are being depreciated to their estimated residual values over the lives of their lease contracts. Depreciation expense for vehicles for the six months ended October 31, 2013 was $13,893 and for the year ended April 30, 2013 it was $53,191. All of the assets are pledged as collateral for the note described in SECURED NOTES PAYABLE in this Note C. These remaining leases are in a run-off mode. | |||||||||
INVENTORY | |||||||||
Inventory is comprised of repossessed vehicles and vehicles which have been returned at the end of their lease. Inventory is carried at the lower of depreciated cost or market, applied on a specific identification basis. At October 31, 2013 and at April 30, 2013, the Company had no repossessed vehicles which are held for resale. | |||||||||
RETAIL (RISC) LOAN RECEIVABLES | |||||||||
All of the Company’s RISC performing loan receivables were sold in August 2012. As of October 31, 2013 and April 30, 2013, the Company had: RISC loans of $11,235 and $0, respectively, and deficiency receivables of $0 and $6,157, respectively. At October 31, 2013 and at April 30, 2013, the reserve for doubtful RISC loan receivables was $1,124 and $3,078, respectively. | |||||||||
As the Company sold all of its portfolio of RISCs, and a portion of its portfolio of leases with the remaining leases in final run-off mode, therefore there no portfolio performance measures were calculated for the quarter or six months ending October 31, 2013 or the year ending April 30, 2013. | |||||||||
LIABILITIES INCLUDED IN DISCONTINUED OPERATIONS | |||||||||
SECURED NOTES PAYABLE | |||||||||
October 31, | April 30, | ||||||||
2013 | 2013 | ||||||||
Secured, subordinated individual lender (a) | $ | 148,384 | $ | 175,383 | |||||
Secured, subordinated individual lender (b) | 13,520 | 14,337 | |||||||
Total | $ | 161,904 | $ | 189,720 | |||||
(a) | The Company had financed certain of its leases and RISCs through two third parties. The repayment terms are generally one year to five years and the notes are secured by the underlying assets. The weighted average interest rate at October 31, 2013 is 15.29%. | ||||||||
(b) | On October 31, 2008, the Company purchased certain loans secured by a portfolio of secured motorcycle leases (“Purchased Portfolio”) for a total purchase price of $100,000. The Company paid $80,000 at closing, $10,000 in April 2009 and agreed to pay the remaining $10,000 upon receipt of additional Purchase Portfolio documentation. As of October 31, 2013, no such documents have been received. Proceeds from the Purchased Portfolio started accruing to the Company beginning November 1, 2008. To finance the purchase, the Company issued a $150,000 Senior Secured Note dated October 31, 2008 (“Senior Secured Note”) in exchange for $100,000 from the holder. Terms of the Senior Secured Note require the Company to make semi-monthly payments in amounts equal to all net proceeds from Purchased Portfolio lease payments and motorcycle asset sales received until the Company has paid $150,000 to the holder. The Company was obligated to pay any remainder of the Senior Secured Note by November 1, 2009 which was extended to May 1, 2013, and has granted the note holder a security interest in the Purchased Portfolio. On January 31, 2013, the holder converted $50,000 of the outstanding balance of the Note into 60,606 shares of the Company’s restricted common stock. The note, which had an outstanding balance of $13,520 at October 31, 2013, has been extended to October 31, 2013. The Company is negotiation an extension of the due date with the note holder. | ||||||||
At October 31, 2013, the notes payable mature as follows: | |||||||||
Year ended October 31, | Amount | ||||||||
2014 | $ | 161,904 | |||||||
Total Due | $ | 161,904 | |||||||
NOTE_D_NOTES_PAYABLE
NOTE D - NOTES PAYABLE | 6 Months Ended | ||||||||
Oct. 31, 2013 | |||||||||
Debt Disclosure [Abstract] | ' | ||||||||
Debt Disclosure [Text Block] | ' | ||||||||
NOTE D – NOTES PAYABLE | |||||||||
Notes Payable | October 31, | April 30, | |||||||
2013 | 2013 | ||||||||
Notes convertible at holder’s option (a) | $ | 1,936,464 | $ | 1,694,504 | |||||
Notes with interest only convertible at Company’s option (b) | 385,000 | 360,000 | |||||||
Non-convertible notes payable (c) | 25,000 | 55,000 | |||||||
Subtotal | 2,346,464 | 2,109,504 | |||||||
Less, Debt discount | (178,024 | ) | (105,029 | ) | |||||
Total | $ | 2,168,439 | $ | 2,004,475 | |||||
(a) | Notes convertible at holder’s option consists of: (i) a $1,198,368, 8% note originally due April 30, 2013, but subsequently amended to such time as the law suit filed by the Company (see: PART II, ITEM 1 LEGAL PROCEEDINGS) is fully adjudicated, convertible at the holder’s option at $0.495 per share. The Company had recorded a $663,403 beneficial conversion discount for this note which was fully amortized during fiscal 2013; (ii) a $67,000, 8% note due May 12, 2014, a $35,000, 8% note due May 24, 2014, and a $35,000, 8% note due July 30, 2014. The Company has recorded beneficial conversion discounts totaling $99,208 for the three notes. The discount is being fully amortized over the terms of the notes. The notes are convertible at the note holder’s option at a variable conversion prices such that during the period during which the notes are outstanding, with all notes convertible at 58% multiplied by the average of the three lowest closing bid prices for the common stock during the ten trading day period ending one trading day prior to the submission date of the conversion notice by the note holder to the Company (the “Discount Conversion Rate”). Other convertible notes issued in prior periods to this note holder and outstanding at July 31, 2013 were repaid in cash. The Company has reserved up to 1,650,000 shares of its common stock for conversion pursuant to the terms of the notes. In the event the notes are not paid when due, the interest rate is increased to twenty-two percent until the note is paid in full; (iii) a $103,399, 12% note due April 30, 2014, convertible at the holder’s option at $3.75 per share. The Company is paying $2,000 in monthly penalty shares on this note until the note is paid in full (the number of penalty shares is based on the five day volume weighted average closing price of the Company’s common stock for the five trading days prior to the 19th of each month); (iv) seven notes aggregating $118,250, all due October 30, 2013 with interest ranging from 15% to 20%, the Company is paying 667 monthly penalty shares until the note is paid in full on one $25,000 note which had been past due, all of the notes are convertible at the holder’s option at $0.375 per share. The Company has recorded a $5,340 beneficial conversion discount for these notes. The discount is being fully amortized over the term of the notes; (v) three notes aggregating $106,250, all due October 30, 2013 with interest ranging from 20% to 25%, all of the notes are convertible at the holder’s option at $0.375 per share. The Company has recorded a $6,120 beneficial conversion discount for these notes. The discount is being fully amortized over the term of the notes; (vi) a $45,000, 8% convertible note due November 30, 2013, convertible at the holder’s option at the lower of $0.25 or the closing market price on the day of conversion. The note holder received 10,000 shares of common stock as inducement for the note. The note carries an 18% default interest rate. The Company has recorded a $44,000 beneficial conversion discount for this note. The discount is being fully amortized over the initial term of the note; (vii) a $55,000, 5% convertible note due February 13, 2014 which has been paid down via conversions to $23,439.33, a $59,000, 5% convertible note due April 24, 2014, a $22,000, 5% convertible note due June 27, 2014 and a $33,000, 5% convertible note due August 21, 2014. This lender has committed to lend up to $330,000 (three hundred thousand) in the form of two $165,000 notes. The Lender initially advanced $55,000 against one $165,000 note which amount was repaid via conversion. The Lender advanced an additional $55,000, $22,000 and an additional $33,000 against one $165,000 note and $59,000 against the other note. The lender may lend additional consideration to the Company in such amounts and at such dates as Lender may choose in its sole discretion. The principal sum due to lender shall be prorated based on the consideration actually paid by lender (plus an approximate 10% original issue discount that is prorated based on the consideration actually paid by the lender as well as any other interest or fees) such that the borrower is only required to repay the amount funded and the Company is not required to repay any unfunded portion of this note. The second note has been amended to include a 3% closing fee on the amount of each sum advanced plus a 5% due diligence fee on the amount of each sum advanced. The combined fees shall be added to the sum advanced for all purposes under the Note, including when calculating the amount of the interest charge. The maturity date is one year from the effective date of each payment and is the date upon which the Principal Sum of this Note, as well as any unpaid interest and other fees, shall be due and payable. The Conversion Price is the lesser of $1.20 or 70% of the average of the three lowest closing prices during the 20 trading days immediately previous to the day the conversion notice is delivered to the Company (In the case that conversion shares are not deliverable by DWAC an additional 5% discount will apply; and if the shares are chilled for deposit into the DTC system and only eligible for Xclearing deposit an additional 7.5% discount shall apply). Unless otherwise agreed in writing by both parties, at no time will the lender convert any amount of this note into common stock that would result in the lender owning more than 4.99% of the common stock outstanding. The Company has recorded a $72,430 beneficial conversion discount for the three outstanding notes. The discount is being fully amortized over the initial term of the notes; (viii) a $27,500, 5% convertible note due July 16, 2014 and a $27,500, 5% convertible note due October 21, 2014. This lender has committed to lend up to $165,000. The lender may lend additional consideration to the Company in such amounts and at such dates as Lender may choose in its sole discretion. The principal sum due to lender shall be prorated based on the consideration actually paid by lender (plus an approximate 10% original issue discount that is prorated based on the consideration actually paid by the lender as well as any other interest or fees) such that the borrower is only required to repay the amount funded and the Company is not required to repay any unfunded portion of this note. The maturity date of each note is one year from the effective date of each payment and is the date upon which the Principal Sum of this Note, as well as any unpaid interest and other fees, shall be due and payable. The Conversion Price for the notes is the lesser of $0.60 or 70% of the lowest closing prices during the 20 trading days immediately previous to the day the conversion notice is delivered to the Company. (In the case that conversion shares are not deliverable by DWAC, the principal amount of the note shall be increased by $10,000, and the conversion price shall be redefined to equal the lesser of (a) $0.60 or (b) 50% of the lowest closing prices during the 20 trading days immediately previous to the day the conversion notice is delivered to the Company). Unless otherwise agreed in writing by both parties, at no time will the lender convert any amount of this note into common stock that would result in the lender owning more than 4.99% of the common stock outstanding. The Company has recorded a $22,501 beneficial conversion discount for the notes. The discount is being fully amortized over the terms of the notes; (ix) a $35,000, 5% convertible note due August 1, 2014, which balance has been paid down to $5,757.50 via conversions. The Conversion Price is the lesser of $0.60 or 70% of the lowest closing prices during the 20 trading days immediately previous to the day the conversion notice is delivered to the Company. In the case that conversion shares are not deliverable by DWAC, the principal amount of the note shall be increased by $10,000, and the conversion price shall be redefined to equal the lesser of (a) $0.60 or (b) 50% of the lowest closing prices during the 20 trading days immediately previous to the day the conversion notice is delivered to the Company. The Company has recorded a $15,000 beneficial conversion discount for this note. The discount is being fully amortized over the initial term of the note; (x) a $25,000, 12% convertible note due April 18, 2014. The Conversion Price is a 36.37% discount from the average of the three lowest closing prices during the ten trading days immediately previous to the day the conversion notice is delivered to the Company. The Company has recorded a $14,290 beneficial conversion discount for this note. The discount is being fully amortized over the initial term of the note; and a (xi) $5,000 5% convertible note due March 1, 2014. The Conversion Price is $0.3595. The Company has recorded a $5,000 beneficial conversion discount for this note. The discount is being fully amortized over the initial term of the note. | ||||||||
(b) | Notes with interest only convertible at Company’s option consist of: (i) two 22% notes in the amounts of $10,000 one due October 31, 2012 and the other due May 1, 2014 respectively, and a $25,000 note due May 1, 2011, was extended to October 31, 2013. The Company is paying the note holder 3,334 shares per month until the note is paid or renegotiated. Interest is payable on all three notes at the Company’s option in cash or in shares at the rate of $1.50 per share; (ii) a $315,000, 12.462% note due April 30, 2014. Interest is payable quarterly with a minimum or $600 in cash with the balance payable in cash or stock at the Company’s options calculated as the volume weighted average price of the Company’s common stock for the ten day trading period immediately preceding the last day of each three month period; and (iii) a $25,000 8% note due November 1, 2013. The Company issued the note holder 5,000 shares of its common stock in connection with this loan. Pursuant to the terms of this note, the Company is required to issue to the note holder 5,000 shares of its common stock for each month or portion thereof that the note remains unpaid. Interest is payable on all this note at the Company’s option in cash or in shares at the rate of $0.35 per share; | ||||||||
(c) | Non-convertible notes consist of a $25,000 note due August 10, 2013 which bears no interest. Pursuant to the terms of this note, the Company is required to issue to the note holder 1,000 shares of its common stock for each month or portion thereof that the note remains unpaid. | ||||||||
Amortization of Beneficial Conversion Feature for the six months ended October 31, 2013 and 2012 was $195,942 and $377,296, respectively and for the fiscal year ended April 30, 2013 was $854,569. | |||||||||
The Company's derivative financial instruments consist of embedded derivatives related to the outstanding short term Convertible Notes Payable. These embedded derivatives include certain conversion features indexed to the Company's common stock. The accounting treatment of derivative financial instruments requires that the Company record the derivatives and related items at their fair values as of the inception date of the Convertible Notes Payable and at fair value as of each subsequent balance sheet date. In addition, under the provisions of Accounting Standards Codification subtopic 815-40, Derivatives and Hedging; Contracts in Entity's Own Equity ("ASC 815-40"), as a result of entering into the Convertible Notes Payable, the Company is required to classify all other non-employee stock options and warrants as derivative liabilities and mark them to market at each reporting date. Any change in fair value inclusive of modifications of terms will be recorded as non-operating, non-cash income or expense at each reporting date. If the fair value of the derivatives is higher at the subsequent balance sheet date, the Company will record a non-operating, non-cash charge. If the fair value of the derivatives is lower at the subsequent balance sheet date, the Company will record non-operating, non-cash income. | |||||||||
Derivative liabilities related to notes payable increased by a net of $153,590 during the six months ended October 31, 2013 to $529,195. $130,269 of this amount was charged to additional-paid-in-capital upon payoff or full conversion of notes payable. Derivative liabilities related to outstanding warrants decreased by a net of $3,202 during the six months ended October 31, 2013. | |||||||||
The change in fair value of the derivative liabilities of warrants outstanding at October 31, 2013 was calculated with the following average assumptions, using a Black-Scholes option pricing model are as follows: | |||||||||
Significant Assumptions: | |||||||||
Risk free interest rate | Ranging from | 0.04 | % | to | 1 | % | |||
Expected stock price volatility | 116 | % | |||||||
Expected dividend payout | 0 | ||||||||
Expected options life in years | Ranging from | 0.24 | year | to | 4.17 | years | |||
The change in fair value of the derivative liabilities of convertible notes outstanding at October 31, 2013 was calculated with the following average assumptions, using a Black-Scholes option pricing model are as follows: | |||||||||
Significant Assumptions: | |||||||||
Risk free interest rate | Ranging from | 0.045 | % | to | 0.1 | % | |||
Expected stock price volatility | 116 | % | |||||||
Expected dividend payout | 0 | ||||||||
Expected options life in years | Ranging from | 0.35 | year | to | 1 | year | |||
NOTE_E_LOANS_PAYABLE_TO_RELATE
NOTE E - LOANS PAYABLE TO RELATED PARTIES | 6 Months Ended |
Oct. 31, 2013 | |
Related Party Transactions [Abstract] | ' |
Related Party Transactions Disclosure [Text Block] | ' |
NOTE E – LOANS PAYABLE TO RELATED PARTIES | |
As of October 31, 2013 and April 30, 2013, aggregated loans payable, without demand and with no interest, to officers and directors were $385,853 and $393,260, respectively. | |
NOTE_F_EQUITY_TRANSACTIONS
NOTE F - EQUITY TRANSACTIONS | 6 Months Ended | |
Oct. 31, 2013 | ||
Stockholders' Equity Note [Abstract] | ' | |
Stockholders' Equity Note Disclosure [Text Block] | ' | |
NOTE F – EQUITY TRANSACTIONS | ||
On May 18, 2012, the Company’s Board of Directors declared effective a one for seventy-five reverse common stock split. All per share amounts in these unaudited condensed consolidated financial statements and accompanying notes have been retroactively adjusted to the earliest period presented for the effect of this reverse stock split. | ||
The Company is authorized to issue 10,000,000 shares of preferred stock with $0.001 par value per share, of which 35,850 shares have been designated as Series A convertible preferred stock with a $100 stated value per share, 1,000 shares have been designated as Series B Preferred Stock with a $10,000 per share liquidation value, and 200,000 shares have been designated as Series C Preferred Stock with a $10 per share liquidation value, and 740,000,000 shares of common stock with $0.001 par value per share. The Company had 125 shares of Series A preferred stock issued and outstanding as of October 31, 2013 and April 30, 2013. The Company had 157 shares of Series B preferred stock issued and outstanding as of October 31, 2013 and April 30, 2013. The Company had nil shares of Series C preferred stock issued and outstanding as of October 31, 2013 and April 30, 2013. The Company has 17,388,205 and 14,131,242 shares of common stock issued and outstanding as of October 31, 2013 and April 30, 2013, respectively. | ||
Preferred Stock, Series A | ||
During the six months ended October 31, 2013, there were no transactions in Series A Preferred, however, at October 31, 2013, there were $6,427 of accrued dividends payable on the Series A Preferred, compared to the accrual of $6,045 at April 30, 2013. At the Company’s option, these dividends may be paid in shares of the Company’s Common Stock. | ||
Preferred Stock, Series B | ||
During the six months ended October 31, 2013, there were no transactions in Series B Preferred Stock, however, at October 31, 2013, there were $78,715.07 of dividends accrued and re-classed as 7.87 shares of Series B Preferred Stock payable. There were a total of 64.8 shares of Series B Preferred payable at October 31, 2013 representing a total of $646,562 in accrued dividends as compared to 56.78 shares of Series B Preferred payable at April 30, 2013 representing $567,847 in accrued dividends | ||
Preferred Stock Series C | ||
There were no shares of Series C Preferred Stock issued and outstanding at October 31, 2013 and at April 30, 2013. | ||
Common Stock | ||
During the six months ended October 31, 2013, the Company expensed $119,037 for non-cash charges related to stock and option compensation expense. | ||
During the six months ended October 31, 2013, the Company: | ||
● | issued 555,110 shares of common stock which had been classified as to be issued at April 30, 2013, | |
● | sold 1,886,686 shares of common stock to fourteen accredited investors for $513,163, of which 83,670 shares remained to be issued at October 31, 2013, | |
● | issued 401,693 shares of common stock upon the conversion of $110,803 principal amount of convertible notes and accrued interest thereon and $62,402 accrued interest on other notes. 27,500 of the 401,693 shares remained to be issued at October 31, 2013, | |
● | issued 71,402 shares of common stock valued at $26,872 pursuant to terms of various notes, | |
● | issued 370,562 shares of common stock valued at $112,358 pursuant to consulting agreements, and | |
● | Issued 100,000 shares of common stock in payment of $39,533 in accounts payable. | |
NOTE_G_NONCONTROLLING_INTEREST
NOTE G - NONCONTROLLING INTEREST | 6 Months Ended | ||||
Oct. 31, 2013 | |||||
Noncontrolling Interest [Abstract] | ' | ||||
Noncontrolling Interest Disclosure [Text Block] | ' | ||||
NOTE G – NONCONTROLLING INTEREST | |||||
For the six months ended October 31, 2013, the non-controlling interest is summarized as follows: | |||||
Amount | |||||
Balance at April 30, 2013 | $ | 723,191 | |||
Noncontrolling interest’s share of losses | (27,969 | ) | |||
Balance at October 31, 2013 | $ | 695,223 | |||
NOTE_H_FAIR_VALUE_MEASUREMENTS
NOTE H - FAIR VALUE MEASUREMENTS | 6 Months Ended | ||||||||||||||||
Oct. 31, 2013 | |||||||||||||||||
Fair Value Disclosures [Abstract] | ' | ||||||||||||||||
Fair Value Disclosures [Text Block] | ' | ||||||||||||||||
NOTE H – FAIR VALUE MEASUREMENTS | |||||||||||||||||
The Company follows the guidance established pursuant to ASC 820 which established a framework for measuring fair value and expands disclosure about fair value measurements. ASC 820 defines fair value as the amount that would be received for an asset or paid to transfer a liability (i.e., an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. ASC 820 also establishes a fair value hierarchy that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 820 describes the following three levels of inputs that may be used: | |||||||||||||||||
Level 1: Quoted prices (unadjusted) in active markets that are accessible at the measurement date for identical assets and liabilities. The fair value hierarchy gives the highest priority to Level 1 inputs. | |||||||||||||||||
Level 2: Observable prices that are based on inputs not quoted on active markets but corroborated by market data. | |||||||||||||||||
Level 3: Unobservable inputs when there is little or no market data available, thereby requiring an entity to develop its own assumptions. The fair value hierarchy gives the lowest priority to Level 3 inputs. | |||||||||||||||||
The table below summarizes the fair values of financial liabilities as of October 31, 2013: | |||||||||||||||||
Fair Value Measurement Using | |||||||||||||||||
Fair Value at | |||||||||||||||||
October 31, | |||||||||||||||||
2013 | Level 1 | Level 2 | Level 3 | ||||||||||||||
Derivative liabilities | $ | 529,190 | - | - | $ | 529,190 | |||||||||||
The following is a description of the valuation methodologies used for these items: | |||||||||||||||||
Derivative liability — these instruments consist of certain variable conversion features related to notes payable obligations and certain outstanding warrants. These instruments were valued using pricing models which incorporate the Company’s stock price, volatility, U.S. risk free rate, dividend rate and estimated life. | |||||||||||||||||
The Company did not identify any other non-recurring assets and liabilities that are required to be presented in the balance sheets at fair value in accordance with ASC Topic 825 “The Fair Value Option for Financial Issuances”. | |||||||||||||||||
Changes in Derivative liability during the six months ended October 31, 2013 were: | |||||||||||||||||
Increased | Decrease | ||||||||||||||||
April 30, | During | in Fair | October 31, | ||||||||||||||
2013 | Period | Value | 2013 | ||||||||||||||
Derivative liability | $ | 378,802 | $ | 468,063 | $ | 317,675 | $ | 529,190 | |||||||||
Total | $ | 378,802 | $ | 468,063 | $ | 317,675 | $ | 529,190 | |||||||||
NOTE_I_NONCASH_FINANCIAL_INFOR
NOTE I - NON-CASH FINANCIAL INFORMATION | 6 Months Ended | |
Oct. 31, 2013 | ||
Disclosure Text Block Supplement [Abstract] | ' | |
Additional Financial Information Disclosure [Text Block] | ' | |
NOTE I – NON-CASH FINANCIAL INFORMATION | ||
During the six months ended October 31, 2013, the Company: | ||
· | classified preferred dividends to be issued of $79,097 | |
· | $130,269 of derivative liability revaluations was charged to additional-paid-in-capital upon payoff or full conversion of notes payable, | |
· | recorded a net increase in beneficial conversion features of various notes of $72,995, | |
· | issued 100,000 shares of common stock in settlement of $39,533 in accounts payable, and | |
· | issued 401,693 shares (27,500 of these shares are still to be issued at October 31, 2013) of common stock upon conversion of $173,205 of notes payable and accrued interest. | |
NOTE_J_SUBSEQUENT_EVENTS
NOTE J - SUBSEQUENT EVENTS | 6 Months Ended | |
Oct. 31, 2013 | ||
Subsequent Events [Abstract] | ' | |
Subsequent Events [Text Block] | ' | |
NOTE J – SUBSEQUENT EVENTS | ||
During November and through December 17, 2013, the Company: | ||
● | Sold 580,570 shares of restricted common stock to seven accredited investors for $154,065, 183,487 shares are still to be issued | |
● | Issued 10,000 shares registered stock in payment of $5,290 in accounts payable | |
● | Issued 182,169 shares upon conversion of $56,190 of convertible notes and accrued interest there on | |
● | Issued 11,226 shares pursuant to the terms of notes payable | |
● | Issued 232,164 shares valued at $69,649 pursuant to consulting agreements | |
● | Issued 91,382 shares which had been classified as to be issued | |
NOTE_K_GOING_CONCERN_MATTERS
NOTE K - GOING CONCERN MATTERS | 6 Months Ended |
Oct. 31, 2013 | |
Going Concern Disclosure [Abstract] | ' |
Going Concern Disclosure [Text Block] | ' |
NOTE K– GOING CONCERN MATTERS | |
The accompanying unaudited condensed consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. As shown in the accompanying unaudited condensed consolidated financial statements during the period July 1, 2004 (date of inception) through October 31, 2013, the Company incurred loss of $42,228,720. Of these losses, $1,237,063 was incurred in the six months ending October 31, 2013. These factors among others may indicate that the Company will be unable to continue as a going concern for a reasonable period of time. | |
The Company’s existence is dependent upon management’s ability to develop profitable operations. Management is devoting substantially all of its efforts to developing its business and raising capital and there can be no assurance that the Company’s efforts will be successful. However, there can be no assurance can be given that management’s actions will result in profitable operations or the resolution of its liquidity problems. The accompanying unaudited condensed consolidated financial statements do not include any adjustments that might result should the Company be unable to continue as a going concern. | |
In order to improve the Company’s liquidity, the Company’s management is actively pursuing additional equity financing through discussions with investment bankers and private investors. There can be no assurance the Company will be successful in its effort to secure additional equity financing. | |
Accounting_Policies_by_Policy_
Accounting Policies, by Policy (Policies) | 6 Months Ended | |
Oct. 31, 2013 | ||
Accounting Policies [Abstract] | ' | |
Basis of Accounting, Policy [Policy Text Block] | ' | |
Basis of Presentation | ||
The accompanying unaudited condensed consolidated financial statements as of October 31, 2013 and for the three and six month periods ended October 31, 2013 and 2012 have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission, including Form 10-Q and Regulation S-K. The information furnished herein reflects all adjustments (consisting of normal recurring accruals and adjustments), which are, in the opinion of management, necessary to fairly present the operating results for the respective periods. Certain information and footnote disclosures normally present in annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been omitted pursuant to such rules and regulations. The Company believes that the disclosures provided are adequate to make the information presented not misleading. These financial statements should be read in conjunction with the audited financial statements and explanatory notes for the year ended April 30, 2013 as disclosed in the Company’s Form 10-K for that year as filed with the Securities and Exchange Commission. | ||
The unaudited condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiary, Specialty Reports, Inc. All significant inter-company transactions and balances have been eliminated in consolidation. | ||
Business | ||
Sparta Commercial Services, Inc. (“Sparta” “we,” “us,” or the “Company”), since May 2010, has concentrated its efforts on developing and marketing vehicle history reports, over the internet, and mobile apps for vehicle dealers and other market segments. Historically, the Company had been in the business as an originator and indirect lender for consumer retail installment loans and consumer lease financing for the purchase or lease of new and used motorcycles (specifically 550cc and higher) and utility-oriented 4-stroke all-terrain vehicles (ATVs). These consumer financing products were discontinued during the fiscal year ending April 30, 2013 (see NOTE C “Discontinued Operations”). The Company continues to offer a leasing program for municipalities. | ||
The results of operations for the six months ended October 31, 2013 are not necessarily indicative of the results to be expected for any other interim period or the full year ending April 30, 2014. | ||
Use of Estimates, Policy [Policy Text Block] | ' | |
Estimates | ||
The preparation of the financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results could differ from those estimates. | ||
Discontinued Operations, Policy [Policy Text Block] | ' | |
Discontinued Operations | ||
As discussed in NOTE C, in the second quarter of fiscal 2013, the Company’s Board of Directors approved management’s recommendation to discontinue the Company’s consumer lease and loan lines of business and the sale of all of the Company’s portfolio of performing RISCs, and a portion of its portfolio of leases. The sale was consummated in that quarter. The assets and liabilities have been accounted for as discontinued operations in the Company’s consolidated balance sheets for all periods presented. The operating results related to these lines of business have been included in discontinued operations in the Company’s consolidated statements of loss for all periods presented. | ||
Revenue Recognition, Policy [Policy Text Block] | ' | |
Revenue Recognition | ||
Revenues from history report and mobile app products are recognized on a cash basis. | ||
The Company’s leases, which are included in Discontinued Operations, are accounted for as either operating leases or direct financing leases. At the inception of operating leases, no lease revenue is recognized and the leased motorcycles, together with the initial direct costs of originating the lease, which are capitalized, appear on the balance sheet as “motorcycles under operating leases-net”. The capitalized cost of each motorcycle is depreciated over the lease term, on a straight-line basis, down to the Company’s original estimate of the projected value of the motorcycle at the end of the scheduled lease term (the “Residual”). Monthly lease payments are recognized as rental income. | ||
Direct financing leases are recorded at the gross amount of the lease receivable (principal amount of the contract plus the calculated earned income over the life of the contract), and the unearned income at lease inception is amortized over the lease term. | ||
The Company’s Retail Installment Sales Contracts (“RISC”), which are included in Discontinued Operations, are secured by liens on the titles to the vehicles. The RISCs are accounted for as loans. Upon purchase, the RISCs appear on the Company’s balance sheet as RISC loan receivable current and long term. Interest income on these loans is recognized when it is earned. | ||
The Company realizes gains and losses as the result of the termination of leases, both at and prior to their scheduled termination, and the disposition of the related motorcycle. The disposal of motorcycles, which reach scheduled termination of a lease, results in a gain or loss equal to the difference between proceeds received from the disposition of the motorcycle and its net book value. Net book value represents the residual value at scheduled lease termination. Lease terminations that occur prior to scheduled maturity as a result of the lessee’s voluntary request to purchase the vehicle have resulted in net gains, equal to the excess of the price received over the motorcycle’s net book value. | ||
Early lease terminations also occur because of (i) a default by the lessee, (ii) the physical loss of the motorcycle, or (iii) the exercise of the lessee’s early termination. In those instances, the Company receives the proceeds from either the resale or release of the repossessed motorcycle, or the payment by the lessee’s insurer. The Company records a gain or loss for the difference between the proceeds received and the net book value of the motorcycle. | ||
Inventory, Policy [Policy Text Block] | ' | |
Inventories | ||
Inventories are valued at the lower of cost or market, with cost determined using the first-in, first-out method and with market defined as the lower of replacement cost or realizable value. | ||
Website Development Costs [Policy Text Block] | ' | |
Website Development Costs | ||
The Company recognizes website development costs in accordance with Accounting Standards Codification (“ASC”) 350-50, "Accounting for Website Development Costs." As such, the Company expenses all costs incurred that relate to the planning and post implementation phases of development of its website. Direct costs incurred in the development phase are capitalized and recognized over the estimated useful life. Costs associated with repair or maintenance for the website are included in cost of net revenues in the current period expenses. | ||
Cash and Cash Equivalents, Policy [Policy Text Block] | ' | |
Cash Equivalents | ||
For the purpose of the accompanying financial statements, all highly liquid investments with a maturity of three months or less are considered to be cash equivalents. | ||
Income Tax, Policy [Policy Text Block] | ' | |
Income Taxes | ||
Deferred income taxes are provided using the asset and liability method for financial reporting purposes in accordance with the provisions of ASC 740-10, "Accounting for Income Taxes (“ASC 740-10”)." Under this method, deferred tax assets and liabilities are recognized for temporary differences between the tax bases of assets and liabilities and their carrying values for financial reporting purposes and for operating loss and tax credit carry forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be removed or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the statements of operations in the period that includes the enactment date. | ||
ASC 740-10, “Accounting for Uncertainty in Income Taxes” prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. ASC 740 also provides guidance on derecognition, classification, treatment of interest and penalties, and disclosure of such positions. As a result of implementing ASC 740, there has been no adjustment to the Company’s financial statements and the adoption of ASC 740 did not have a material effect on the Company’s consolidated financial statements for the year ending April 30, 2013 or the three months or six months ended October 31, 2013. | ||
Fair Value Measurement, Policy [Policy Text Block] | ' | |
Fair Value Measurements | ||
The Company adopted ASC 820, “Fair Value Measurements (“ASC 820”).” ASC 820 establishes a three-level fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets the lowest priority to unobservable inputs to fair value measurements of certain assets and Liabilities. The three levels of the fair value hierarchy under ASC 820 are described below: | ||
· | Level 1 — Quoted prices for identical instruments in active markets. Level 1 assets and liabilities include debt and equity securities and derivative contracts that are traded in an active exchange market, as well as certain securities that are highly liquid and are actively traded in over-the-counter markets. | |
· | Level 2 — Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model derived valuations in which all significant inputs and significant value drivers are observable in active markets. | |
· | Level 3 — Unobservable inputs that are supported by little or no market activity and that are significant to the fair value measurements. Level 3 assets and liabilities include financial instruments whose value is determined using pricing models, discounted cash flow methodologies, or similar techniques based on significant unobservable inputs, as well as management judgments or estimates that are significant to valuation. | |
This hierarchy requires the Company to use observable market data, when available, and to minimize the use of unobservable inputs when determining fair value. For some products or in certain market conditions, observable inputs may not always be available. | ||
Impairment or Disposal of Long-Lived Assets, Policy [Policy Text Block] | ' | |
Impairment of Long-Lived Assets | ||
In accordance ASC 360-10, “Impairment or Disposal of Long-Lived Assets,” long-lived assets, such as property, equipment, motorcycles and other vehicles and purchased intangible assets subject to amortization are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable. Recoverability of assets to be held and used is measured by comparing the carrying amount of an asset to estimated undiscounted future cash flows expected to be generated by the asset. If the carrying amount of an asset exceeds its estimated future cash flows or quoted market prices in active markets if available, an impairment charge is recognized by the amount by which the carrying amount of the asset exceeds the fair value of the asset. | ||
Comprehensive Income, Policy [Policy Text Block] | ' | |
Comprehensive Income | ||
In accordance with ASC 220-10, “Reporting Comprehensive Income,” (“ASC 220-10”) establishes standards for reporting and displaying of comprehensive income, its components and accumulated balances. Comprehensive income is defined to include all changes in equity except those resulting from investments by owners and distributions to owners. Among other disclosures, ASC 220-10 requires that all items that are required to be recognized under current accounting standards as components of comprehensive income be reported in a financial statement that is displayed with the same prominence as other financial statements. At October 31, 2013 and April 30, 2013, the Company has no items of other comprehensive income. | ||
Segment Reporting, Policy [Policy Text Block] | ' | |
Segment Information | ||
The Company adopted ASC 280-10 “Disclosures about Segments of an Enterprise and Related Information.” ASC 280-10 establishes standards for reporting information regarding operating segments in annual financial statements and requires selected information for those segments to be presented in consolidated financial reports issued to stockholders. ASC 280-10 also establishes standards for related disclosures about products and services and geographic areas. Operating segments are identified as components of an enterprise about which separate discrete financial information is available for evaluation by the chief operating decision maker, or decision making group, in making decisions how to allocate resources and assess performance. The information disclosed herein, materially represents all of the financial information related to the Company's principal operating segments. | ||
In the second quarter of fiscal 2013, the Company’s Board of Directors approved management’s recommendation to discontinue the Company’s consumer lease and loan lines of business and the sale of all of the Company’s portfolio of performing RISCs and a portion of its portfolio of leases. The sale was consummated in that quarter. The assets and liabilities have been accounted for as discontinued operations in the Company’s consolidated balance sheets for all periods presented. The operating results related to these lines of business have been included in discontinued operations in the Company’s consolidated statements of loss for all periods presented. As these lines of business were discontinued during the fiscal year ending April 30, 2013, the Company has discontinued segment reporting. | ||
Share-based Compensation, Option and Incentive Plans Policy [Policy Text Block] | ' | |
Stock Based Compensation | ||
The Company adopted ASC 718-10, which records compensation expense on a straight-line basis, generally over the explicit service period of three to five years. | ||
ASC 718-10 requires companies to estimate the fair value of share-based payment awards on the date of grant using an option-pricing model. The value of the portion of the award that is ultimately expected to vest is recognized as expense over the requisite service periods in the Company’s Consolidated Statement of Operations. The Company is using the Black-Scholes option-pricing model as its method of valuation for share-based awards. The Company’s determination of fair value of share-based payment awards on the date of grant using an option-pricing model is affected by the Company’s stock price as well as assumptions regarding a number of highly complex and subjective variables. These variables include, but are not limited to the Company’s expected stock price volatility over the term of the awards, and certain other market variables such as the risk free interest rate. | ||
Concentration Risk, Credit Risk, Policy [Policy Text Block] | ' | |
Concentrations of Credit Risk | ||
Financial instruments and related items, which potentially subject the Company to concentrations of credit risk, consist primarily of cash, cash equivalents and receivables. The Company places its cash and temporary cash investments with high credit quality institutions. At times, such investments may be in excess of the FDIC insurance limit. | ||
Property, Plant and Equipment, Policy [Policy Text Block] | ' | |
Property and Equipment | ||
Property and equipment are recorded at cost. Minor additions and renewals are expensed in the year incurred. Major additions and renewals are capitalized and depreciated over their estimated useful lives. Depreciation is calculated using the straight-line method over the estimated useful lives. Estimated useful lives of major depreciable assets are as follows: | ||
Advertising Costs, Policy [Policy Text Block] | ' | |
Advertising Costs | ||
The Company follows a policy of charging the costs of advertising to expenses incurred. During the six months ended October 31, 2013 and 2012, the Company incurred advertising costs of $8,500 and $3,000, respectively. During the three months ended October 31, 2013 and 2012, the Company incurred advertising expenses of $4,250 and $1,500, respectively. | ||
Earnings Per Share, Policy [Policy Text Block] | ' | |
Net Loss Per Share | ||
The Company uses ASC 260-10, “Earnings Per Share,” for calculating the basic and diluted loss per share. The Company computes basic loss per share by dividing net loss and net loss attributable to common shareholders by the weighted average number of common shares outstanding. Common equivalent shares are excluded from the computation of net loss per share if their effect is anti-dilutive. | ||
Per share basic and diluted net loss attributable to common stockholders amounted to $0.05 and $0.09 for the three months ended October 31, 2013 and 2012, respectively, and $0.08 and $0.19 for the six months ended October 31, 2013 and 2012, respectively. At October 31, 2013 and 2012, 5,586,766 and 4,076,101 potential shares, respectively, were excluded from the shares used to calculate diluted earnings per share as their inclusion would reduce net loss per share. | ||
Liquidity Disclosure [Policy Text Block] | ' | |
Liquidity | ||
As shown in the accompanying unaudited, condensed consolidated financial statements, the Company has incurred a net loss attributed to common stockholders of $1,237,063 and $1,941,177 during the six months ended October 31, 2013 and October 31, 2012, respectively. The Company’s liabilities exceed its assets by $4,059,003 as of October 31, 2013. | ||
Reclassification, Policy [Policy Text Block] | ' | |
Reclassifications | ||
Certain reclassifications have been made to conform to prior periods' data to the current presentation. These reclassifications had no effect on reported losses. | ||
New Accounting Pronouncements, Policy [Policy Text Block] | ' | |
Recent Accounting Pronouncements | ||
There were various updates recently issued, most of which represented technical corrections to the accounting literature or applications to specific industries and are not expected to have a material impact on the Company’s unaudited condensed consolidated financial position, results of operations or cash flows. |
NOTE_A_SUMMARY_OF_ACCOUNTING_P1
NOTE A - SUMMARY OF ACCOUNTING POLICIES (Tables) (Estimated useful lives [Member]) | 6 Months Ended | |
Oct. 31, 2013 | ||
Estimated useful lives [Member] | ' | |
NOTE A - SUMMARY OF ACCOUNTING POLICIES (Tables) [Line Items] | ' | |
Property, Plant and Equipment [Table Text Block] | 'Estimated useful lives of major depreciable assets are as follows: | |
Leasehold improvements | 3 years | |
Furniture and fixtures | 7 years | |
Website costs | 3 years | |
Computer Equipment | 5 years |
NOTE_B_PROPERTY_AND_EQUIPMENT_
NOTE B - PROPERTY AND EQUIPMENT (Tables) (Property, Plant and Equipment [Member]) | 6 Months Ended | ||||||||
Oct. 31, 2013 | |||||||||
Property, Plant and Equipment [Member] | ' | ||||||||
NOTE B - PROPERTY AND EQUIPMENT (Tables) [Line Items] | ' | ||||||||
Property, Plant and Equipment [Table Text Block] | 'Major classes of property and equipment at October 31, 2013 and April 30, 2013 consist of the followings: | ||||||||
October 31, | April 30, | ||||||||
2013 | 2013 | ||||||||
Computer equipment, software and furniture | $ | 209,341 | $ | 209,341 | |||||
Less: accumulated depreciation | (197,573 | ) | (194,795 | ) | |||||
Net property and equipment | $ | 11,768 | $ | 14,546 |
NOTE_C_DISCONTINUED_OPERATIONS1
NOTE C - DISCONTINUED OPERATIONS (Tables) (Consumer Lease and Loan Lines of Business [Member]) | 6 Months Ended | ||||||||
Oct. 31, 2013 | |||||||||
Consumer Lease and Loan Lines of Business [Member] | ' | ||||||||
NOTE C - DISCONTINUED OPERATIONS (Tables) [Line Items] | ' | ||||||||
Schedule of Disposal Groups, Including Discontinued Operations, Income Statement, Balance Sheet and Additional Disclosures [Table Text Block] | 'The following table presents summarized operating results for those discontinued operations. | ||||||||
Six Months Ended | |||||||||
October 31, | October 31, | ||||||||
2013 | 2012 | ||||||||
Revenues | $ | 58,997 | $ | 134,571 | |||||
Net (loss) | $ | (278,613 | ) | $ | (531,806 | ) | |||
Schedule of Property Subject to or Available for Operating Lease [Table Text Block] | 'Motorcycles and other vehicles under operating leases at October 31, 2013 and April 30, 2013: | ||||||||
October 31, | April 30, | ||||||||
2013 | 2013 | ||||||||
Motorcycles and other vehicles | $ | 110,955 | $ | 152,157 | |||||
Less: accumulated depreciation | (25,241 | ) | (36,687 | ) | |||||
Motorcycles and other vehicles, net of accumulated depreciation | 85,714 | 115,470 | |||||||
Less: estimated reserve for residual values | (8,991 | ) | (8,880 | ) | |||||
Motorcycles and other vehicles under operating leases, net | $ | 76,723 | $ | 106,591 | |||||
Schedule of Secured Senior Notes Payable [Table Text Block] | ' | ||||||||
October 31, | April 30, | ||||||||
2013 | 2013 | ||||||||
Secured, subordinated individual lender (a) | $ | 148,384 | $ | 175,383 | |||||
Secured, subordinated individual lender (b) | 13,520 | 14,337 | |||||||
Total | $ | 161,904 | $ | 189,720 | |||||
(a) | The Company had financed certain of its leases and RISCs through two third parties. The repayment terms are generally one year to five years and the notes are secured by the underlying assets. The weighted average interest rate at October 31, 2013 is 15.29%. | ||||||||
(b) | On October 31, 2008, the Company purchased certain loans secured by a portfolio of secured motorcycle leases (“Purchased Portfolio”) for a total purchase price of $100,000. The Company paid $80,000 at closing, $10,000 in April 2009 and agreed to pay the remaining $10,000 upon receipt of additional Purchase Portfolio documentation. As of October 31, 2013, no such documents have been received. Proceeds from the Purchased Portfolio started accruing to the Company beginning November 1, 2008. To finance the purchase, the Company issued a $150,000 Senior Secured Note dated October 31, 2008 (“Senior Secured Note”) in exchange for $100,000 from the holder. Terms of the Senior Secured Note require the Company to make semi-monthly payments in amounts equal to all net proceeds from Purchased Portfolio lease payments and motorcycle asset sales received until the Company has paid $150,000 to the holder. The Company was obligated to pay any remainder of the Senior Secured Note by November 1, 2009 which was extended to May 1, 2013, and has granted the note holder a security interest in the Purchased Portfolio. On January 31, 2013, the holder converted $50,000 of the outstanding balance of the Note into 60,606 shares of the Company’s restricted common stock. The note, which had an outstanding balance of $13,520 at October 31, 2013, has been extended to October 31, 2013. The Company is negotiation an extension of the due date with the note holder. | ||||||||
Schedule of Maturities of Long-term Debt [Table Text Block] | 'At October 31, 2013, the notes payable mature as follows: | ||||||||
Year ended October 31, | Amount | ||||||||
2014 | $ | 161,904 | |||||||
Total Due | $ | 161,904 |
NOTE_D_NOTES_PAYABLE_Tables
NOTE D - NOTES PAYABLE (Tables) | 6 Months Ended | ||||||||
Oct. 31, 2013 | |||||||||
NOTE D - NOTES PAYABLE (Tables) [Line Items] | ' | ||||||||
Schedule of Debt [Table Text Block] | ' | ||||||||
Notes Payable | October 31, | April 30, | |||||||
2013 | 2013 | ||||||||
Notes convertible at holder’s option (a) | $ | 1,936,464 | $ | 1,694,504 | |||||
Notes with interest only convertible at Company’s option (b) | 385,000 | 360,000 | |||||||
Non-convertible notes payable (c) | 25,000 | 55,000 | |||||||
Subtotal | 2,346,464 | 2,109,504 | |||||||
Less, Debt discount | (178,024 | ) | (105,029 | ) | |||||
Total | $ | 2,168,439 | $ | 2,004,475 | |||||
(a) | Notes convertible at holder’s option consists of: (i) a $1,198,368, 8% note originally due April 30, 2013, but subsequently amended to such time as the law suit filed by the Company (see: PART II, ITEM 1 LEGAL PROCEEDINGS) is fully adjudicated, convertible at the holder’s option at $0.495 per share. The Company had recorded a $663,403 beneficial conversion discount for this note which was fully amortized during fiscal 2013; (ii) a $67,000, 8% note due May 12, 2014, a $35,000, 8% note due May 24, 2014, and a $35,000, 8% note due July 30, 2014. The Company has recorded beneficial conversion discounts totaling $99,208 for the three notes. The discount is being fully amortized over the terms of the notes. The notes are convertible at the note holder’s option at a variable conversion prices such that during the period during which the notes are outstanding, with all notes convertible at 58% multiplied by the average of the three lowest closing bid prices for the common stock during the ten trading day period ending one trading day prior to the submission date of the conversion notice by the note holder to the Company (the “Discount Conversion Rate”). Other convertible notes issued in prior periods to this note holder and outstanding at July 31, 2013 were repaid in cash. The Company has reserved up to 1,650,000 shares of its common stock for conversion pursuant to the terms of the notes. In the event the notes are not paid when due, the interest rate is increased to twenty-two percent until the note is paid in full; (iii) a $103,399, 12% note due April 30, 2014, convertible at the holder’s option at $3.75 per share. The Company is paying $2,000 in monthly penalty shares on this note until the note is paid in full (the number of penalty shares is based on the five day volume weighted average closing price of the Company’s common stock for the five trading days prior to the 19th of each month); (iv) seven notes aggregating $118,250, all due October 30, 2013 with interest ranging from 15% to 20%, the Company is paying 667 monthly penalty shares until the note is paid in full on one $25,000 note which had been past due, all of the notes are convertible at the holder’s option at $0.375 per share. The Company has recorded a $5,340 beneficial conversion discount for these notes. The discount is being fully amortized over the term of the notes; (v) three notes aggregating $106,250, all due October 30, 2013 with interest ranging from 20% to 25%, all of the notes are convertible at the holder’s option at $0.375 per share. The Company has recorded a $6,120 beneficial conversion discount for these notes. The discount is being fully amortized over the term of the notes; (vi) a $45,000, 8% convertible note due November 30, 2013, convertible at the holder’s option at the lower of $0.25 or the closing market price on the day of conversion. The note holder received 10,000 shares of common stock as inducement for the note. The note carries an 18% default interest rate. The Company has recorded a $44,000 beneficial conversion discount for this note. The discount is being fully amortized over the initial term of the note; (vii) a $55,000, 5% convertible note due February 13, 2014 which has been paid down via conversions to $23,439.33, a $59,000, 5% convertible note due April 24, 2014, a $22,000, 5% convertible note due June 27, 2014 and a $33,000, 5% convertible note due August 21, 2014. This lender has committed to lend up to $330,000 (three hundred thousand) in the form of two $165,000 notes. The Lender initially advanced $55,000 against one $165,000 note which amount was repaid via conversion. The Lender advanced an additional $55,000, $22,000 and an additional $33,000 against one $165,000 note and $59,000 against the other note. The lender may lend additional consideration to the Company in such amounts and at such dates as Lender may choose in its sole discretion. The principal sum due to lender shall be prorated based on the consideration actually paid by lender (plus an approximate 10% original issue discount that is prorated based on the consideration actually paid by the lender as well as any other interest or fees) such that the borrower is only required to repay the amount funded and the Company is not required to repay any unfunded portion of this note. The second note has been amended to include a 3% closing fee on the amount of each sum advanced plus a 5% due diligence fee on the amount of each sum advanced. The combined fees shall be added to the sum advanced for all purposes under the Note, including when calculating the amount of the interest charge. The maturity date is one year from the effective date of each payment and is the date upon which the Principal Sum of this Note, as well as any unpaid interest and other fees, shall be due and payable. The Conversion Price is the lesser of $1.20 or 70% of the average of the three lowest closing prices during the 20 trading days immediately previous to the day the conversion notice is delivered to the Company (In the case that conversion shares are not deliverable by DWAC an additional 5% discount will apply; and if the shares are chilled for deposit into the DTC system and only eligible for Xclearing deposit an additional 7.5% discount shall apply). Unless otherwise agreed in writing by both parties, at no time will the lender convert any amount of this note into common stock that would result in the lender owning more than 4.99% of the common stock outstanding. The Company has recorded a $72,430 beneficial conversion discount for the three outstanding notes. The discount is being fully amortized over the initial term of the notes; (viii) a $27,500, 5% convertible note due July 16, 2014 and a $27,500, 5% convertible note due October 21, 2014. This lender has committed to lend up to $165,000. The lender may lend additional consideration to the Company in such amounts and at such dates as Lender may choose in its sole discretion. The principal sum due to lender shall be prorated based on the consideration actually paid by lender (plus an approximate 10% original issue discount that is prorated based on the consideration actually paid by the lender as well as any other interest or fees) such that the borrower is only required to repay the amount funded and the Company is not required to repay any unfunded portion of this note. The maturity date of each note is one year from the effective date of each payment and is the date upon which the Principal Sum of this Note, as well as any unpaid interest and other fees, shall be due and payable. The Conversion Price for the notes is the lesser of $0.60 or 70% of the lowest closing prices during the 20 trading days immediately previous to the day the conversion notice is delivered to the Company. (In the case that conversion shares are not deliverable by DWAC, the principal amount of the note shall be increased by $10,000, and the conversion price shall be redefined to equal the lesser of (a) $0.60 or (b) 50% of the lowest closing prices during the 20 trading days immediately previous to the day the conversion notice is delivered to the Company). Unless otherwise agreed in writing by both parties, at no time will the lender convert any amount of this note into common stock that would result in the lender owning more than 4.99% of the common stock outstanding. The Company has recorded a $22,501 beneficial conversion discount for the notes. The discount is being fully amortized over the terms of the notes; (ix) a $35,000, 5% convertible note due August 1, 2014, which balance has been paid down to $5,757.50 via conversions. The Conversion Price is the lesser of $0.60 or 70% of the lowest closing prices during the 20 trading days immediately previous to the day the conversion notice is delivered to the Company. In the case that conversion shares are not deliverable by DWAC, the principal amount of the note shall be increased by $10,000, and the conversion price shall be redefined to equal the lesser of (a) $0.60 or (b) 50% of the lowest closing prices during the 20 trading days immediately previous to the day the conversion notice is delivered to the Company. The Company has recorded a $15,000 beneficial conversion discount for this note. The discount is being fully amortized over the initial term of the note; (x) a $25,000, 12% convertible note due April 18, 2014. The Conversion Price is a 36.37% discount from the average of the three lowest closing prices during the ten trading days immediately previous to the day the conversion notice is delivered to the Company. The Company has recorded a $14,290 beneficial conversion discount for this note. The discount is being fully amortized over the initial term of the note; and a (xi) $5,000 5% convertible note due March 1, 2014. The Conversion Price is $0.3595. The Company has recorded a $5,000 beneficial conversion discount for this note. The discount is being fully amortized over the initial term of the note. | ||||||||
(b) | Notes with interest only convertible at Company’s option consist of: (i) two 22% notes in the amounts of $10,000 one due October 31, 2012 and the other due May 1, 2014 respectively, and a $25,000 note due May 1, 2011, was extended to October 31, 2013. The Company is paying the note holder 3,334 shares per month until the note is paid or renegotiated. Interest is payable on all three notes at the Company’s option in cash or in shares at the rate of $1.50 per share; (ii) a $315,000, 12.462% note due April 30, 2014. Interest is payable quarterly with a minimum or $600 in cash with the balance payable in cash or stock at the Company’s options calculated as the volume weighted average price of the Company’s common stock for the ten day trading period immediately preceding the last day of each three month period; and (iii) a $25,000 8% note due November 1, 2013. The Company issued the note holder 5,000 shares of its common stock in connection with this loan. Pursuant to the terms of this note, the Company is required to issue to the note holder 5,000 shares of its common stock for each month or portion thereof that the note remains unpaid. Interest is payable on all this note at the Company’s option in cash or in shares at the rate of $0.35 per share; | ||||||||
(c) | Non-convertible notes consist of a $25,000 note due August 10, 2013 which bears no interest. Pursuant to the terms of this note, the Company is required to issue to the note holder 1,000 shares of its common stock for each month or portion thereof that the note remains unpaid. | ||||||||
Warrant [Member] | ' | ||||||||
NOTE D - NOTES PAYABLE (Tables) [Line Items] | ' | ||||||||
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Table Text Block] | 'The change in fair value of the derivative liabilities of warrants outstanding at October 31, 2013 was calculated with the following average assumptions, using a Black-Scholes option pricing model are as follows: | ||||||||
Significant Assumptions: | |||||||||
Risk free interest rate | Ranging from | 0.04 | % | to | 1 | % | |||
Expected stock price volatility | 116 | % | |||||||
Expected dividend payout | 0 | ||||||||
Expected options life in years | Ranging from | 0.24 | year | to | 4.17 | years | |||
Convertible Notes [Member] | ' | ||||||||
NOTE D - NOTES PAYABLE (Tables) [Line Items] | ' | ||||||||
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Table Text Block] | 'The change in fair value of the derivative liabilities of convertible notes outstanding at October 31, 2013 was calculated with the following average assumptions, using a Black-Scholes option pricing model are as follows: | ||||||||
Significant Assumptions: | |||||||||
Risk free interest rate | Ranging from | 0.045 | % | to | 0.1 | % | |||
Expected stock price volatility | 116 | % | |||||||
Expected dividend payout | 0 | ||||||||
Expected options life in years | Ranging from | 0.35 | year | to | 1 | year |
NOTE_G_NONCONTROLLING_INTEREST1
NOTE G - NONCONTROLLING INTEREST (Tables) | 6 Months Ended | ||||
Oct. 31, 2013 | |||||
Noncontrolling Interest [Abstract] | ' | ||||
Schedule of Noncontrolling Interest [Table Text Block] | 'For the six months ended October 31, 2013, the non-controlling interest is summarized as follows: | ||||
Amount | |||||
Balance at April 30, 2013 | $ | 723,191 | |||
Noncontrolling interest’s share of losses | (27,969 | ) | |||
Balance at October 31, 2013 | $ | 695,223 |
NOTE_H_FAIR_VALUE_MEASUREMENTS1
NOTE H - FAIR VALUE MEASUREMENTS (Tables) | 6 Months Ended | ||||||||||||||||
Oct. 31, 2013 | |||||||||||||||||
Fair Value Disclosures [Abstract] | ' | ||||||||||||||||
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis [Table Text Block] | 'The table below summarizes the fair values of financial liabilities as of October 31, 2013: | ||||||||||||||||
Fair Value Measurement Using | |||||||||||||||||
Fair Value at | |||||||||||||||||
October 31, | |||||||||||||||||
2013 | Level 1 | Level 2 | Level 3 | ||||||||||||||
Derivative liabilities | $ | 529,190 | - | - | $ | 529,190 | |||||||||||
Schedule of Derivative Liabilities at Fair Value [Table Text Block] | 'Changes in Derivative liability during the six months ended October 31, 2013 were: | ||||||||||||||||
Increased | Decrease | ||||||||||||||||
April 30, | During | in Fair | October 31, | ||||||||||||||
2013 | Period | Value | 2013 | ||||||||||||||
Derivative liability | $ | 378,802 | $ | 468,063 | $ | 317,675 | $ | 529,190 | |||||||||
Total | $ | 378,802 | $ | 468,063 | $ | 317,675 | $ | 529,190 |
NOTE_A_SUMMARY_OF_ACCOUNTING_P2
NOTE A - SUMMARY OF ACCOUNTING POLICIES (Details) (USD $) | 3 Months Ended | 6 Months Ended | ||
Oct. 31, 2013 | Oct. 31, 2012 | Oct. 31, 2013 | Oct. 31, 2012 | |
Accounting Policies [Abstract] | ' | ' | ' | ' |
Advertising Expense (in Dollars) | $4,250 | $1,500 | ($8,500) | $3,000 |
Income (Loss) from Continuing Operations, Per Basic and Diluted Share (in Dollars per share) | $0.05 | $0.09 | $0.08 | $0.19 |
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount (in Shares) | ' | ' | 5,586,766 | 4,076,101 |
Net Income (Loss) Attributable to Parent (in Dollars) | ($737,302) | ($879,198) | ($1,237,063) | ($1,941,177) |
NOTE_A_SUMMARY_OF_ACCOUNTING_P3
NOTE A - SUMMARY OF ACCOUNTING POLICIES (Details) - Schedule of Estimated Useful Lives of Property and Equipment | 6 Months Ended |
Oct. 31, 2013 | |
Leasehold Improvements [Member] | ' |
Property, Plant and Equipment [Line Items] | ' |
Useful Lives | '3 years |
Furniture and Fixtures [Member] | ' |
Property, Plant and Equipment [Line Items] | ' |
Useful Lives | '7 years |
Website Costs [Member] | ' |
Property, Plant and Equipment [Line Items] | ' |
Useful Lives | '3 years |
Computer Equipment [Member] | ' |
Property, Plant and Equipment [Line Items] | ' |
Useful Lives | '5 years |
NOTE_B_PROPERTY_AND_EQUIPMENT_1
NOTE B - PROPERTY AND EQUIPMENT (Details) (USD $) | 3 Months Ended | 6 Months Ended | ||
Oct. 31, 2013 | Oct. 31, 2012 | Oct. 31, 2013 | Oct. 31, 2012 | |
Property, Plant and Equipment [Abstract] | ' | ' | ' | ' |
Depreciation | $357 | $1,684 | $2,778 | $4,177 |
NOTE_B_PROPERTY_AND_EQUIPMENT_2
NOTE B - PROPERTY AND EQUIPMENT (Details) - Schedule of Property and Equipment (USD $) | Oct. 31, 2013 | Apr. 30, 2013 |
Schedule of Property and Equipment [Abstract] | ' | ' |
Computer equipment, software and furniture | $209,341 | $209,341 |
Less: accumulated depreciation | -197,573 | -194,795 |
Net property and equipment | $11,768 | $14,546 |
NOTE_C_DISCONTINUED_OPERATIONS2
NOTE C - DISCONTINUED OPERATIONS (Details) (USD $) | 3 Months Ended | 6 Months Ended | 6 Months Ended | 12 Months Ended | |||||
Oct. 31, 2013 | Oct. 31, 2012 | Oct. 31, 2013 | Oct. 31, 2012 | Apr. 30, 2013 | Oct. 31, 2013 | Oct. 31, 2013 | Apr. 30, 2013 | Apr. 30, 2009 | |
Consumer Lease and Loan Lines of Business [Member] | Consumer Lease and Loan Lines of Business [Member] | Consumer Lease and Loan Lines of Business [Member] | Consumer Lease and Loan Lines of Business [Member] | ||||||
Secured Subordinated Individual Lender 2 [Member] | |||||||||
NOTE C - DISCONTINUED OPERATIONS (Details) [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Depreciation | $357 | $1,684 | $2,778 | $4,177 | ' | ' | $13,893 | $53,191 | ' |
Loans and Leases Receivable, Nonperforming, Nonaccrual of Interest | 11,235 | ' | 11,235 | ' | 0 | ' | ' | ' | ' |
Loans and Leases Receivable, Gross, Consumer | ' | ' | ' | ' | ' | ' | 0 | 6,157 | ' |
Allowance for Loan and Lease Losses, Provision for Loss, Net (Deprecated 2013-01-31) | ' | ' | ' | ' | ' | ' | 1,124 | 3,078 | ' |
Description of Lessee Leasing Arrangements, Operating Leases | ' | ' | ' | ' | ' | ' | 'The Company had financed certain of its leases and RISCs through two third parties. The repayment terms are generally one year to five years and the notes are secured by the underlying assets | ' | ' |
Contract Receivable, Due after One Year, Weighted Average Interest Rate | ' | ' | ' | ' | ' | ' | 15.29% | ' | ' |
Payments for Purchase of Other Assets | ' | ' | ' | ' | ' | ' | ' | ' | 100,000 |
Purchased Portfolio, Payment Terms | ' | ' | ' | ' | ' | ' | ' | ' | 'The Company paid $80,000 at closing, $10,000 in April 2009 and agreed to pay the remaining $10,000 upon receipt of additional Purchase Portfolio documentation |
Debt Instrument, Face Amount | ' | ' | ' | ' | ' | ' | ' | ' | 150,000 |
Proceeds from Secured Notes Payable | ' | ' | ' | ' | ' | ' | ' | ' | 100,000 |
Debt Instrument, Payment Terms | ' | ' | ' | ' | ' | ' | ' | ' | 'Terms of the Senior Secured Note require the Company to make semi-monthly payments in amounts equal to all net proceeds from Purchased Portfolio lease payments and motorcycle asset sales received until the Company has paid $150,000 to the holder |
Debt Conversion, Converted Instrument, Amount (in Dollars) | ' | ' | ' | ' | ' | ' | ' | 50,000 | ' |
Debt Conversion, Converted Instrument, Shares Issued (in Shares) | ' | ' | ' | ' | ' | ' | ' | 60,606 | ' |
Senior Notes | ' | ' | ' | ' | ' | $13,520 | ' | ' | ' |
Debt Instrument, Maturity Date | ' | ' | ' | ' | ' | ' | ' | 31-Oct-13 | ' |
NOTE_C_DISCONTINUED_OPERATIONS3
NOTE C - DISCONTINUED OPERATIONS (Details) - Schedule of Disposal Groups, Including Discontinued Operations, Income Statement, Balance Sheet and Additional Disclosures (USD $) | 3 Months Ended | 6 Months Ended | 12 Months Ended | |||
Oct. 31, 2013 | Oct. 31, 2012 | Oct. 31, 2013 | Oct. 31, 2012 | Oct. 31, 2013 | Apr. 30, 2013 | |
Consumer Lease and Loan Lines of Business [Member] | Consumer Lease and Loan Lines of Business [Member] | |||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ' | ' | ' | ' | ' | ' |
Revenues | ' | ' | ' | ' | $58,997 | $134,571 |
Net (loss) | ($267,992) | ($256,539) | ($278,613) | ($531,806) | ($278,613) | ($531,806) |
NOTE_C_DISCONTINUED_OPERATIONS4
NOTE C - DISCONTINUED OPERATIONS (Details) - Schedule of Property Subject to or Available for Operating Lease (Consumer Lease and Loan Lines of Business [Member], USD $) | Oct. 31, 2013 | Apr. 30, 2013 |
Consumer Lease and Loan Lines of Business [Member] | ' | ' |
Property Subject to or Available for Operating Lease [Line Items] | ' | ' |
Motorcycles and other vehicles | $110,955 | $152,157 |
Less: accumulated depreciation | -25,241 | -36,687 |
Motorcycles and other vehicles, net of accumulated depreciation | 85,714 | 115,470 |
Less: estimated reserve for residual values | -8,991 | -8,880 |
Motorcycles and other vehicles under operating leases, net | $76,723 | $106,591 |
NOTE_C_DISCONTINUED_OPERATIONS5
NOTE C - DISCONTINUED OPERATIONS (Details) - Schedule of Secured Senior Notes (Consumer Lease and Loan Lines of Business [Member], USD $) | Oct. 31, 2013 | Apr. 30, 2013 | ||
NOTE C - DISCONTINUED OPERATIONS (Details) - Schedule of Secured Senior Notes [Line Items] | ' | ' | ||
Senior subordinated notes | $161,904 | $189,720 | ||
Secured Subordinated Individual Lender 1 [Member] | ' | ' | ||
NOTE C - DISCONTINUED OPERATIONS (Details) - Schedule of Secured Senior Notes [Line Items] | ' | ' | ||
Senior subordinated notes | 148,384 | [1] | 175,383 | [1] |
Secured Subordinated Individual Lender 2 [Member] | ' | ' | ||
NOTE C - DISCONTINUED OPERATIONS (Details) - Schedule of Secured Senior Notes [Line Items] | ' | ' | ||
Senior subordinated notes | $13,520 | [2] | $14,337 | [2] |
[1] | The Company had financed certain of its leases and RISCs through two third parties. The repayment terms are generally one year to five years and the notes are secured by the underlying assets. The weighted average interest rate at October 31, 2013 is 15.29%. | |||
[2] | On October 31, 2008, the Company purchased certain loans secured by a portfolio of secured motorcycle leases ("Purchased Portfolio") for a total purchase price of $100,000. The Company paid $80,000 at closing, $10,000 in April 2009 and agreed to pay the remaining $10,000 upon receipt of additional Purchase Portfolio documentation. As of October 31, 2013, no such documents have been received. Proceeds from the Purchased Portfolio started accruing to the Company beginning November 1, 2008. To finance the purchase, the Company issued a $150,000 Senior Secured Note dated October 31, 2008 ("Senior Secured Note") in exchange for $100,000 from the holder. Terms of the Senior Secured Note require the Company to make semi-monthly payments in amounts equal to all net proceeds from Purchased Portfolio lease payments and motorcycle asset sales received until the Company has paid $150,000 to the holder. The Company was obligated to pay any remainder of the Senior Secured Note by November 1, 2009 which was extended to May 1, 2013, and has granted the note holder a security interest in the Purchased Portfolio. On January 31, 2013, the holder converted $50,000 of the outstanding balance of the Note into 60,606 shares of the Company's restricted common stock. The note, which had an outstanding balance of $13,520 at October 31, 2013, has been extended to October 31, 2013. The Company is negotiation an extension of the due date with the note holder. |
NOTE_C_DISCONTINUED_OPERATIONS6
NOTE C - DISCONTINUED OPERATIONS (Details) - Schedule of Maturities of Long-term Debt (Consumer Lease and Loan Lines of Business [Member], USD $) | Oct. 31, 2013 |
Consumer Lease and Loan Lines of Business [Member] | ' |
NOTE C - DISCONTINUED OPERATIONS (Details) - Schedule of Maturities of Long-term Debt [Line Items] | ' |
2014 | $161,904 |
Total Due | $161,904 |
NOTE_D_NOTES_PAYABLE_Details
NOTE D - NOTES PAYABLE (Details) (USD $) | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Oct. 31, 2013 | Oct. 31, 2012 | Oct. 31, 2013 | Oct. 31, 2012 | Apr. 30, 2013 | |
NOTE D - NOTES PAYABLE (Details) [Line Items] | ' | ' | ' | ' | ' |
Debt Instrument, Convertible, Beneficial Conversion Feature | ' | ' | $72,995 | ' | ' |
Amortization of Debt Discount (Premium) | 120,451 | 205,087 | 195,942 | 377,296 | 854,569 |
Derivative Liability, Current | 529,190 | ' | 529,190 | ' | 378,802 |
Convertible Note Committed by Lender Up to $330,000 [Member] | Notes Convertible at Holder's Option [Member] | ' | ' | ' | ' | ' |
NOTE D - NOTES PAYABLE (Details) [Line Items] | ' | ' | ' | ' | ' |
Debt Instrument, Convertible, Beneficial Conversion Feature | ' | ' | 72,430 | ' | ' |
Debt Instrument, Convertible, Terms of Conversion Feature | ' | ' | 'lesser of $1.20 or 70% of the average of the three lowest closing prices during the 20 trading days immediately previous to the day the conversion notice is delivered to the Company (In the case that conversion shares are not deliverable by DWAC an additional 5% discount will apply; and if the shares are chilled for deposit into the DTC system and only eligible for Xclearing deposit an additional 7.5% discount shall apply) | ' | ' |
Number of Notes | ' | ' | 3 | ' | ' |
Debt Instrument, Description | ' | ' | 'This lender has committed to lend up to $330,000 (three hundred thousand) in the form of two $165,000 notes | ' | ' |
Debt Instrument, Original Issue Discount, Percent | 10.00% | ' | 10.00% | ' | ' |
Debt Instrument, Maturity Date, Description | ' | ' | 'one year from the effective date of each payment | ' | ' |
Maximum Percentage of Shares Convertible by Lender | ' | ' | 4.99% | ' | ' |
Second Convertible Note up to $165,000 [Member] | Notes Convertible at Holder's Option [Member] | ' | ' | ' | ' | ' |
NOTE D - NOTES PAYABLE (Details) [Line Items] | ' | ' | ' | ' | ' |
Debt Instrument, Description | ' | ' | 'The second note has been amended to include a 3% closing fee on the amount of each sum advanced plus a 5% due diligence feeon the amount of each sum advanced. | ' | ' |
Convertible Note Committed by Lender Up to $165,000 [Member] | Notes Convertible at Holder's Option [Member] | ' | ' | ' | ' | ' |
NOTE D - NOTES PAYABLE (Details) [Line Items] | ' | ' | ' | ' | ' |
Debt Instrument, Convertible, Beneficial Conversion Feature | ' | ' | 22,501 | ' | ' |
Debt Instrument, Convertible, Terms of Conversion Feature | ' | ' | 'In the case that conversion shares are not deliverable by DWAC, the principal amount of the note shall be increased by $10,000, and the conversion price shall be redefined to equal the lesser of (a) $0.60 or (b) 50% of the lowest closing prices during the 20 trading days immediately previous to the day the conversion notice is delivered to the Company | ' | ' |
Debt Instrument, Payment Terms | ' | ' | 'The principal sum due to lender shall be prorated based on the consideration actually paid by lender(plus an approximate 10% original issue discount that is prorated based on the consideration actually paid by the lender as well as any other interest or fees) such that the borrower is only required to repay the amount funded and the Company is not required to repay any unfunded portion of this note. | ' | ' |
Debt Instrument, Description | ' | ' | 'This lender has committed to lend up to $165,000 | ' | ' |
Maximum Percentage of Shares Convertible by Lender | ' | ' | 4.99% | ' | ' |
Convertible Note due April 30, 2013 [Member] | Notes Convertible at Holder's Option [Member] | ' | ' | ' | ' | ' |
NOTE D - NOTES PAYABLE (Details) [Line Items] | ' | ' | ' | ' | ' |
Debt Instrument, Face Amount | 1,198,368 | ' | 1,198,368 | ' | ' |
Debt Instrument, Interest Rate, Stated Percentage | 8.00% | ' | 8.00% | ' | ' |
Debt Instrument, Convertible, Conversion Price (in Dollars per share) | $0.50 | ' | $0.50 | ' | ' |
Debt Instrument, Convertible, Beneficial Conversion Feature | ' | ' | 663,403 | ' | ' |
Convertible Note Due on May 12, 2014 [Member] | Notes Convertible at Holder's Option [Member] | ' | ' | ' | ' | ' |
NOTE D - NOTES PAYABLE (Details) [Line Items] | ' | ' | ' | ' | ' |
Debt Instrument, Face Amount | 67,000 | ' | 67,000 | ' | ' |
Debt Instrument, Interest Rate, Stated Percentage | 8.00% | ' | 8.00% | ' | ' |
Convertible Note due on May 24, 2014 [Member] | Notes Convertible at Holder's Option [Member] | ' | ' | ' | ' | ' |
NOTE D - NOTES PAYABLE (Details) [Line Items] | ' | ' | ' | ' | ' |
Debt Instrument, Face Amount | 35,000 | ' | 35,000 | ' | ' |
Debt Instrument, Interest Rate, Stated Percentage | 8.00% | ' | 8.00% | ' | ' |
Convertible Note due July 30, 2014 [Member] | Notes Convertible at Holder's Option [Member] | ' | ' | ' | ' | ' |
NOTE D - NOTES PAYABLE (Details) [Line Items] | ' | ' | ' | ' | ' |
Debt Instrument, Face Amount | 35,000 | ' | 35,000 | ' | ' |
Debt Instrument, Interest Rate, Stated Percentage | 8.00% | ' | 8.00% | ' | ' |
Three Convertible Notes [Member] | Notes Convertible at Holder's Option [Member] | ' | ' | ' | ' | ' |
NOTE D - NOTES PAYABLE (Details) [Line Items] | ' | ' | ' | ' | ' |
Debt Instrument, Convertible, Beneficial Conversion Feature | ' | ' | 99,208 | ' | ' |
Debt Instrument, Convertible, Terms of Conversion Feature | ' | ' | '58% multiplied by the average of the three lowest closing bid prices for the common stock during the ten trading day period ending one trading day prior to the submission date of the conversion notice | ' | ' |
Common Stock, Capital Shares Reserved for Future Issuance (in Shares) | 1,650,000 | ' | 1,650,000 | ' | ' |
Debt Instrument, Payment Terms | ' | ' | 'In the event the notes arenot paid when due, the interest rate is increased to twenty-two percent until the note is paid in full | ' | ' |
Convertible Note Due on April 30, 2014 [Member] | Notes Convertible at Holder's Option [Member] | ' | ' | ' | ' | ' |
NOTE D - NOTES PAYABLE (Details) [Line Items] | ' | ' | ' | ' | ' |
Debt Instrument, Face Amount | 103,399 | ' | 103,399 | ' | ' |
Debt Instrument, Interest Rate, Stated Percentage | 12.00% | ' | 12.00% | ' | ' |
Debt Instrument, Convertible, Conversion Price (in Dollars per share) | $3.75 | ' | $3.75 | ' | ' |
Debt Instrument, Monthly Penalty Shares, Value | ' | ' | 2,000 | ' | ' |
Debt Instrument, Monthly Penalty Shares, Description | ' | ' | 'the number of penalty shares is based on the five day volume weighted average closing price of the Company's common stock for the five trading days prior to the 19th of each month | ' | ' |
Convertible Note Due on April 30, 2014 [Member] | Notes Convertible at Company's Option [Member] | ' | ' | ' | ' | ' |
NOTE D - NOTES PAYABLE (Details) [Line Items] | ' | ' | ' | ' | ' |
Debt Instrument, Face Amount | 315,000 | ' | 315,000 | ' | ' |
Debt Instrument, Interest Rate, Stated Percentage | 12.46% | ' | 12.46% | ' | ' |
Debt Instrument, Payment Terms | ' | ' | 'Interest is payable quarterly with a minimum or $600 in cash with the balance payable in cash or stock at the Company's options calculated as the volume weighted average price of the Company's common stock for the ten day trading period immediately preceding the last day of each three month period | ' | ' |
Seven Convertible Notes Due October 30, 2013 [Member] | Notes Convertible at Holder's Option [Member] | ' | ' | ' | ' | ' |
NOTE D - NOTES PAYABLE (Details) [Line Items] | ' | ' | ' | ' | ' |
Debt Instrument, Face Amount | 118,250 | ' | 118,250 | ' | ' |
Debt Instrument, Convertible, Conversion Price (in Dollars per share) | $0.38 | ' | $0.38 | ' | ' |
Debt Instrument, Convertible, Beneficial Conversion Feature | ' | ' | 5,340 | ' | ' |
Debt Instrument, Monthly Penalty Shares, Description | ' | ' | 'Company is paying 667 monthly penalty shares until the note is paid in full on one$25,000 note which had been past due | ' | ' |
Number of Notes | ' | ' | 7 | ' | ' |
Debt Instrument, Interest Rate, Stated Percentage Rate Range, Minimum | ' | ' | 15.00% | ' | ' |
Debt Instrument, Interest Rate, Stated Percentage Rate Range, Maximum | ' | ' | 20.00% | ' | ' |
Debt Instrument, Monthly Penalty Shares (in Shares) | ' | ' | 667 | ' | ' |
Three Convertible Notes Due October 30, 2013 [Member] | Notes Convertible at Holder's Option [Member] | ' | ' | ' | ' | ' |
NOTE D - NOTES PAYABLE (Details) [Line Items] | ' | ' | ' | ' | ' |
Debt Instrument, Face Amount | 106,250 | ' | 106,250 | ' | ' |
Debt Instrument, Convertible, Conversion Price (in Dollars per share) | $0.38 | ' | $0.38 | ' | ' |
Debt Instrument, Convertible, Beneficial Conversion Feature | ' | ' | 6,120 | ' | ' |
Number of Notes | ' | ' | 3 | ' | ' |
Debt Instrument, Interest Rate, Stated Percentage Rate Range, Minimum | ' | ' | 20.00% | ' | ' |
Debt Instrument, Interest Rate, Stated Percentage Rate Range, Maximum | ' | ' | 25.00% | ' | ' |
Convertible Note due November 30, 2013 [Member] | Notes Convertible at Holder's Option [Member] | ' | ' | ' | ' | ' |
NOTE D - NOTES PAYABLE (Details) [Line Items] | ' | ' | ' | ' | ' |
Debt Instrument, Face Amount | 45,000 | ' | 45,000 | ' | ' |
Debt Instrument, Interest Rate, Stated Percentage | 8.00% | ' | 8.00% | ' | ' |
Debt Instrument, Convertible, Beneficial Conversion Feature | ' | ' | 44,000 | ' | ' |
Debt Instrument, Convertible, Terms of Conversion Feature | ' | ' | 'lower of $0.25 or the closing market price on the day of conversion | ' | ' |
Stock Issued During Period, Shares, Inducements for Loans (in Shares) | ' | ' | 10,000 | ' | ' |
Debt Instrument, Interest Rate Terms | ' | ' | '18% default interest rate | ' | ' |
Convertible Note due on February 13, 2014 [Member] | Notes Convertible at Holder's Option [Member] | ' | ' | ' | ' | ' |
NOTE D - NOTES PAYABLE (Details) [Line Items] | ' | ' | ' | ' | ' |
Debt Instrument, Face Amount | 55,000 | ' | 55,000 | ' | ' |
Debt Instrument, Interest Rate, Stated Percentage | 5.00% | ' | 5.00% | ' | ' |
Debt Instrument, Convertible, Beneficial Conversion Feature | ' | ' | 23,439.33 | ' | ' |
Convertible Note on April 24, 2014 [Member] | Notes Convertible at Holder's Option [Member] | ' | ' | ' | ' | ' |
NOTE D - NOTES PAYABLE (Details) [Line Items] | ' | ' | ' | ' | ' |
Debt Instrument, Face Amount | 59,000 | ' | 59,000 | ' | ' |
Debt Instrument, Interest Rate, Stated Percentage | 5.00% | ' | 5.00% | ' | ' |
Convertible Note Due June 27, 2014 [Member] | Notes Convertible at Holder's Option [Member] | ' | ' | ' | ' | ' |
NOTE D - NOTES PAYABLE (Details) [Line Items] | ' | ' | ' | ' | ' |
Debt Instrument, Face Amount | 22,000 | ' | 22,000 | ' | ' |
Debt Instrument, Interest Rate, Stated Percentage | 5.00% | ' | 5.00% | ' | ' |
Convertible Note due August 21, 2014 [Member] | Notes Convertible at Holder's Option [Member] | ' | ' | ' | ' | ' |
NOTE D - NOTES PAYABLE (Details) [Line Items] | ' | ' | ' | ' | ' |
Debt Instrument, Face Amount | 33,000 | ' | 33,000 | ' | ' |
Debt Instrument, Interest Rate, Stated Percentage | 5.00% | ' | 5.00% | ' | ' |
Convertible Note Due on July 16, 2014 [Member] | Notes Convertible at Holder's Option [Member] | ' | ' | ' | ' | ' |
NOTE D - NOTES PAYABLE (Details) [Line Items] | ' | ' | ' | ' | ' |
Debt Instrument, Face Amount | 27,500 | ' | 27,500 | ' | ' |
Debt Instrument, Interest Rate, Stated Percentage | 5.00% | ' | 5.00% | ' | ' |
Convertible Note due on October 21, 2014 [Member] | Notes Convertible at Holder's Option [Member] | ' | ' | ' | ' | ' |
NOTE D - NOTES PAYABLE (Details) [Line Items] | ' | ' | ' | ' | ' |
Debt Instrument, Face Amount | 27,500 | ' | 27,500 | ' | ' |
Debt Instrument, Interest Rate, Stated Percentage | 5.00% | ' | 5.00% | ' | ' |
Convertible Note Due on August 1, 2014 [Member] | Notes Convertible at Holder's Option [Member] | ' | ' | ' | ' | ' |
NOTE D - NOTES PAYABLE (Details) [Line Items] | ' | ' | ' | ' | ' |
Debt Instrument, Face Amount | 35,000 | ' | 35,000 | ' | ' |
Debt Instrument, Interest Rate, Stated Percentage | 5.00% | ' | 5.00% | ' | ' |
Debt Instrument, Convertible, Beneficial Conversion Feature | ' | ' | 15,000 | ' | ' |
Debt Instrument, Convertible, Terms of Conversion Feature | ' | ' | 'In the case that conversion shares are not deliverable by DWAC, the principal amount of the note shall be increased by $10,000, and the conversion price shall be redefined to equal the lesser of (a) $0.60 or (b) 50% of the lowest closing prices during the 20 trading days immediately previous to the day the conversion notice is delivered to the Company. | ' | ' |
Convertible Notes Payable | 5,757.50 | ' | 5,757.50 | ' | ' |
Debt Conversion, Description | ' | ' | 'lesser of $0.60 or 70% of the lowest closing prices during the 20 trading days immediately previous to the day the conversion notice is delivered to the Company | ' | ' |
Convertible Note due April 18, 2014 [Member] | Notes Convertible at Holder's Option [Member] | ' | ' | ' | ' | ' |
NOTE D - NOTES PAYABLE (Details) [Line Items] | ' | ' | ' | ' | ' |
Debt Instrument, Face Amount | 25,000 | ' | 25,000 | ' | ' |
Debt Instrument, Interest Rate, Stated Percentage | 12.00% | ' | 12.00% | ' | ' |
Debt Instrument, Convertible, Beneficial Conversion Feature | ' | ' | 14,290 | ' | ' |
Debt Conversion, Description | ' | ' | 'The Conversion Price is a 36.37% discount from the average of the three lowest closing prices during the ten trading days immediately previous to the day the conversion notice is delivered to the Company | ' | ' |
Convertible Note due March 1, 2014 [Member] | Notes Convertible at Holder's Option [Member] | ' | ' | ' | ' | ' |
NOTE D - NOTES PAYABLE (Details) [Line Items] | ' | ' | ' | ' | ' |
Debt Instrument, Face Amount | 5,000 | ' | 5,000 | ' | ' |
Debt Instrument, Interest Rate, Stated Percentage | 5.00% | ' | 5.00% | ' | ' |
Debt Instrument, Convertible, Conversion Price (in Dollars per share) | $0.36 | ' | $0.36 | ' | ' |
Debt Instrument, Convertible, Beneficial Conversion Feature | ' | ' | 5,000 | ' | ' |
Two Convertible Notes Due October 31, 2012 and May 1, 2014 [Member] | Notes Convertible at Company's Option [Member] | ' | ' | ' | ' | ' |
NOTE D - NOTES PAYABLE (Details) [Line Items] | ' | ' | ' | ' | ' |
Number of Notes | ' | ' | 2 | ' | ' |
Convertible Note Due On October 31, 2012 [Member] | Notes Convertible at Company's Option [Member] | ' | ' | ' | ' | ' |
NOTE D - NOTES PAYABLE (Details) [Line Items] | ' | ' | ' | ' | ' |
Debt Instrument, Face Amount | 10,000 | ' | 10,000 | ' | ' |
Debt Instrument, Interest Rate, Stated Percentage | 22.00% | ' | 22.00% | ' | ' |
Debt Instrument, Payment Terms | ' | ' | 'Interest is payable on all three notes at the Company's option in cash or in shares at the rate of $1.50 per share | ' | ' |
Convertible Note Due May 1, 2014 [Member] | Notes Convertible at Company's Option [Member] | ' | ' | ' | ' | ' |
NOTE D - NOTES PAYABLE (Details) [Line Items] | ' | ' | ' | ' | ' |
Debt Instrument, Face Amount | 10,000 | ' | 10,000 | ' | ' |
Debt Instrument, Interest Rate, Stated Percentage | 22.00% | ' | 22.00% | ' | ' |
Debt Instrument, Payment Terms | ' | ' | 'Interest is payable on all three notes at the Company's option in cash or in shares at the rate of $1.50 per share | ' | ' |
Convertible Note Due on October 31, 2013 [Member] | Notes Convertible at Company's Option [Member] | ' | ' | ' | ' | ' |
NOTE D - NOTES PAYABLE (Details) [Line Items] | ' | ' | ' | ' | ' |
Debt Instrument, Face Amount | 25,000 | ' | 25,000 | ' | ' |
Debt Instrument, Payment Terms | ' | ' | 'Interest is payable on all three notes at the Company's option in cash or in shares at the rate of $1.50 per share | ' | ' |
Debt Instrument, Monthly Penalty Shares (in Shares) | ' | ' | 3,334 | ' | ' |
Convertible Note due November 1, 2013 [Member] | Notes Convertible at Company's Option [Member] | ' | ' | ' | ' | ' |
NOTE D - NOTES PAYABLE (Details) [Line Items] | ' | ' | ' | ' | ' |
Debt Instrument, Face Amount | 25,000 | ' | 25,000 | ' | ' |
Debt Instrument, Interest Rate, Stated Percentage | 8.00% | ' | 8.00% | ' | ' |
Debt Instrument, Payment Terms | ' | ' | 'Interest is payable on all this note at the Company's option in cash or in shares at the rate of $0.35 per share | ' | ' |
Debt Instrument, Monthly Penalty Shares (in Shares) | ' | ' | 5,000 | ' | ' |
Non-Convertible Note Due August 10, 2013 [Member] | Non Convertible Notes Payable [Member] | ' | ' | ' | ' | ' |
NOTE D - NOTES PAYABLE (Details) [Line Items] | ' | ' | ' | ' | ' |
Debt Instrument, Face Amount | 25,000 | ' | 25,000 | ' | ' |
Debt Instrument, Monthly Penalty Shares (in Shares) | ' | ' | 1,000 | ' | ' |
Derivative Liabilities Related to Notes Payable [Member] | ' | ' | ' | ' | ' |
NOTE D - NOTES PAYABLE (Details) [Line Items] | ' | ' | ' | ' | ' |
Derivative, Gain (Loss) on Derivative, Net | ' | ' | 153,590 | ' | ' |
Derivative Liability, Current | 529,195 | ' | 529,195 | ' | ' |
Debt Conversion, Original Debt, Amount | ' | ' | 130,269 | ' | ' |
Derivative Liabilities Related to Warrants [Member] | ' | ' | ' | ' | ' |
NOTE D - NOTES PAYABLE (Details) [Line Items] | ' | ' | ' | ' | ' |
Derivative, Gain (Loss) on Derivative, Net | ' | ' | $3,202 | ' | ' |
NOTE_D_NOTES_PAYABLE_Details_S
NOTE D - NOTES PAYABLE (Details) - Schedule of Notes Payble (USD $) | Oct. 31, 2013 | Apr. 30, 2013 | ||
NOTE D - NOTES PAYABLE (Details) - Schedule of Notes Payble [Line Items] | ' | ' | ||
Note payable, gross | $2,346,464 | $2,109,504 | ||
Less, Debt discount | -178,024 | -105,029 | ||
Total | 2,168,439 | 2,004,475 | ||
Notes Convertible at Holder's Option [Member] | ' | ' | ||
NOTE D - NOTES PAYABLE (Details) - Schedule of Notes Payble [Line Items] | ' | ' | ||
Note payable, gross | 1,936,464 | [1] | 1,694,504 | [1] |
Notes with Interest Only, Covertible at Company's Option [Member] | ' | ' | ||
NOTE D - NOTES PAYABLE (Details) - Schedule of Notes Payble [Line Items] | ' | ' | ||
Note payable, gross | 385,000 | [2] | 360,000 | [2] |
Non Convertible Notes Payable [Member] | ' | ' | ||
NOTE D - NOTES PAYABLE (Details) - Schedule of Notes Payble [Line Items] | ' | ' | ||
Note payable, gross | $25,000 | [3] | $55,000 | [3] |
[1] | Notes convertible at holder's option consists of: (i) a $1,198,368, 8% note originally due April 30, 2013, but subsequently amended to such time as the law suit filed by the Company (see: PART II, ITEM 1 LEGAL PROCEEDINGS) is fully adjudicated, convertible at the holder's option at $0.495 per share. The Company had recorded a $663,403 beneficial conversion discount for this note which was fully amortized during fiscal 2013; (ii) a $67,000, 8% note due May 12, 2014, a $35,000, 8% note due May 24, 2014, and a $35,000, 8% note due July 30, 2014. The Company has recorded beneficial conversion discounts totaling $99,208 for the three notes. The discount is being fully amortized over the terms of the notes. The notes are convertible at the note holder's option at a variable conversion prices such that during the period during which the notes are outstanding, with all notes convertible at 58% multiplied by the average of the three lowest closing bid prices for the common stock during the ten trading day period ending one trading day prior to the submission date of the conversion notice by the note holder to the Company (the "Discount Conversion Rate"). Other convertible notes issued in prior periods to this note holder and outstanding at July 31, 2013 were repaid in cash. The Company has reserved up to 1,650,000 shares of its common stock for conversion pursuant to the terms of the notes. In the event the notes are not paid when due, the interest rate is increased to twenty-two percent until the note is paid in full; (iii) a $103,399, 12% note due April 30, 2014, convertible at the holder's option at $3.75 per share. The Company is paying $2,000 in monthly penalty shares on this note until the note is paid in full (the number of penalty shares is based on the five day volume weighted average closing price of the Company's common stock for the five trading days prior to the 19th of each month); (iv) seven notes aggregating $118,250, all due October 30, 2013 with interest ranging from 15% to 20%, the Company is paying 667 monthly penalty shares until the note is paid in full on one $25,000 note which had been past due, all of the notes are convertible at the holder's option at $0.375 per share. The Company has recorded a $5,340 beneficial conversion discount for these notes. The discount is being fully amortized over the term of the notes; (v) three notes aggregating $106,250, all due October 30, 2013 with interest ranging from 20% to 25%, all of the notes are convertible at the holder's option at $0.375 per share. The Company has recorded a $6,120 beneficial conversion discount for these notes. The discount is being fully amortized over the term of the notes; (vi) a $45,000, 8% convertible note due November 30, 2013, convertible at the holder's option at the lower of $0.25 or the closing market price on the day of conversion. The note holder received 10,000 shares of common stock as inducement for the note. The note carries an 18% default interest rate. The Company has recorded a $44,000 beneficial conversion discount for this note. The discount is being fully amortized over the initial term of the note; (vii) a $55,000, 5% convertible note due February 13, 2014 which has been paid down via conversions to $23,439.33, a $59,000, 5% convertible note due April 24, 2014, a $22,000, 5% convertible note due June 27, 2014 and a $33,000, 5% convertible note due August 21, 2014. This lender has committed to lend up to $330,000 (three hundred thousand) in the form of two $165,000 notes. The Lender initially advanced $55,000 against one $165,000 note which amount was repaid via conversion. The Lender advanced an additional $55,000, $22,000 and an additional $33,000 against one $165,000 note and $59,000 against the other note. The lender may lend additional consideration to the Company in such amounts and at such dates as Lender may choose in its sole discretion. The principal sum due to lender shall be prorated based on the consideration actually paid by lender (plus an approximate 10% original issue discount that is prorated based on the consideration actually paid by the lender as well as any other interest or fees) such that the borrower is only required to repay the amount funded and the Company is not required to repay any unfunded portion of this note. The second note has been amended to include a 3% closing fee on the amount of each sum advanced plus a 5% due diligence fee on the amount of each sum advanced. The combined fees shall be added to the sum advanced for all purposes under the Note, including when calculating the amount of the interest charge. The maturity date is one year from the effective date of each payment and is the date upon which the Principal Sum of this Note, as well as any unpaid interest and other fees, shall be due and payable. The Conversion Price is the lesser of $1.20 or 70% of the average of the three lowest closing prices during the 20 trading days immediately previous to the day the conversion notice is delivered to the Company (In the case that conversion shares are not deliverable by DWAC an additional 5% discount will apply; and if the shares are chilled for deposit into the DTC system and only eligible for Xclearing deposit an additional 7.5% discount shall apply). Unless otherwise agreed in writing by both parties, at no time will the lender convert any amount of this note into common stock that would result in the lender owning more than 4.99% of the common stock outstanding. The Company has recorded a $72,430 beneficial conversion discount for the three outstanding notes. The discount is being fully amortized over the initial term of the notes; (viii) a $27,500, 5% convertible note due July 16, 2014 and a $27,500, 5% convertible note due October 21, 2014. This lender has committed to lend up to $165,000. The lender may lend additional consideration to the Company in such amounts and at such dates as Lender may choose in its sole discretion. The principal sum due to lender shall be prorated based on the consideration actually paid by lender (plus an approximate 10% original issue discount that is prorated based on the consideration actually paid by the lender as well as any other interest or fees) such that the borrower is only required to repay the amount funded and the Company is not required to repay any unfunded portion of this note. The maturity date of each note is one year from the effective date of each payment and is the date upon which the Principal Sum of this Note, as well as any unpaid interest and other fees, shall be due and payable. The Conversion Price for the notes is the lesser of $0.60 or 70% of the lowest closing prices during the 20 trading days immediately previous to the day the conversion notice is delivered to the Company. (In the case that conversion shares are not deliverable by DWAC, the principal amount of the note shall be increased by $10,000, and the conversion price shall be redefined to equal the lesser of (a) $0.60 or (b) 50% of the lowest closing prices during the 20 trading days immediately previous to the day the conversion notice is delivered to the Company). Unless otherwise agreed in writing by both parties, at no time will the lender convert any amount of this note into common stock that would result in the lender owning more than 4.99% of the common stock outstanding. The Company has recorded a $22,501 beneficial conversion discount for the notes. The discount is being fully amortized over the terms of the notes; (ix) a $35,000, 5% convertible note due August 1, 2014, which balance has been paid down to $5,757.50 via conversions. The Conversion Price is the lesser of $0.60 or 70% of the lowest closing prices during the 20 trading days immediately previous to the day the conversion notice is delivered to the Company. In the case that conversion shares are not deliverable by DWAC, the principal amount of the note shall be increased by $10,000, and the conversion price shall be redefined to equal the lesser of (a) $0.60 or (b) 50% of the lowest closing prices during the 20 trading days immediately previous to the day the conversion notice is delivered to the Company. The Company has recorded a $15,000 beneficial conversion discount for this note. The discount is being fully amortized over the initial term of the note; (x) a $25,000, 12% convertible note due April 18, 2014. The Conversion Price is a 36.37% discount from the average of the three lowest closing prices during the ten trading days immediately previous to the day the conversion notice is delivered to the Company. The Company has recorded a $14,290 beneficial conversion discount for this note. The discount is being fully amortized over the initial term of the note; and a (xi) $5,000 5% convertible note due March 1, 2014. The Conversion Price is $0.3595. The Company has recorded a $5,000 beneficial conversion discount for this note. The discount is being fully amortized over the initial term of the note. | |||
[2] | Notes with interest only convertible at Company's option consist of: (i) two 22% notes in the amounts of $10,000 one due October 31, 2012 and the other due May 1, 2014 respectively, and a $25,000 note due May 1, 2011, was extended to October 31, 2013. The Company is paying the note holder 3,334 shares per month until the note is paid or renegotiated. Interest is payable on all three notes at the Company's option in cash or in shares at the rate of $1.50 per share; (ii) a $315,000, 12.462% note due April 30, 2014. Interest is payable quarterly with a minimum or $600 in cash with the balance payable in cash or stock at the Company's options calculated as the volume weighted average price of the Company's common stock for the ten day trading period immediately preceding the last day of each three month period; and (iii) a $25,000 8% note due November 1, 2013. The Company issued the note holder 5,000 shares of its common stock in connection with this loan. Pursuant to the terms of this note, the Company is required to issue to the note holder 5,000 shares of its common stock for each month or portion thereof that the note remains unpaid. Interest is payable on all this note at the Company's option in cash or in shares at the rate of $0.35 per share; | |||
[3] | Non-convertible notes consist of a $25,000 note due August 10, 2013 which bears no interest. Pursuant to the terms of this note, the Company is required to issue to the note holder 1,000 shares of its common stock for each month or portion thereof that the note remains unpaid. |
NOTE_D_NOTES_PAYABLE_Details_F
NOTE D - NOTES PAYABLE (Details) - Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques of Warrants (Warrant [Member], AFN) | 6 Months Ended |
Oct. 31, 2013 | |
Minimum [Member] | ' |
Significant Assumptions: | ' |
Risk free interest rate | 0.04% |
Expected stock price volatility | 0.24% |
Expected options life in years | 0.24% |
Maximum [Member] | ' |
Significant Assumptions: | ' |
Risk free interest rate | 1.00% |
Expected stock price volatility | 116.00% |
Expected dividend payout (in Afghanis per share) | 0 |
Expected options life in years | 116.00% |
Expected options life in years | '4 years 62 days |
NOTE_D_NOTES_PAYABLE_Details_F1
NOTE D - NOTES PAYABLE (Details) - Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques of Convertible Notes (Convertible Notes [Member], AFN) | 6 Months Ended |
Oct. 31, 2013 | |
Minimum [Member] | ' |
Significant Assumptions: | ' |
Risk free interest rate | 0.05% |
Expected options life in years | '127 days |
Maximum [Member] | ' |
Significant Assumptions: | ' |
Risk free interest rate | 0.10% |
Expected stock price volatility | 116.00% |
Expected dividend payout (in Afghanis per share) | 0 |
Expected options life in years | '1 year |
NOTE_E_LOANS_PAYABLE_TO_RELATE1
NOTE E - LOANS PAYABLE TO RELATED PARTIES (Details) (Officers and Directors [Member], USD $) | Oct. 31, 2013 | Apr. 30, 2013 |
Officers and Directors [Member] | ' | ' |
NOTE E - LOANS PAYABLE TO RELATED PARTIES (Details) [Line Items] | ' | ' |
Debt Instrument, Interest Rate, Stated Percentage | 0.00% | 0.00% |
Notes Payable, Related Parties (in Dollars) | $385,853 | $393,260 |
NOTE_F_EQUITY_TRANSACTIONS_Det
NOTE F - EQUITY TRANSACTIONS (Details) (USD $) | 6 Months Ended | 12 Months Ended | 6 Months Ended | 6 Months Ended | 6 Months Ended | ||||||||||||
Oct. 31, 2013 | Oct. 31, 2012 | Apr. 30, 2013 | Oct. 31, 2013 | Oct. 31, 2013 | Oct. 31, 2013 | Apr. 30, 2013 | Oct. 31, 2013 | Apr. 30, 2013 | Oct. 31, 2013 | Apr. 30, 2013 | Oct. 31, 2013 | Oct. 31, 2013 | Oct. 30, 2013 | Oct. 30, 2013 | Oct. 31, 2013 | Oct. 30, 2013 | |
Conversion of $110,803 [Member] | Conversion of $62,402 [Member] | Series A Preferred Stock [Member] | Series A Preferred Stock [Member] | Series B Preferred Stock [Member] | Series B Preferred Stock [Member] | Series C Preferred Stock [Member] | Series C Preferred Stock [Member] | Stock Issued Which Was Previously Classified as To Be Issued [Member] | Common stock issued to investors [Member] | Common stock issued to Consultants [Member] | Settlement of Accounts Payable [Member] | Settlement of Accounts Payable [Member] | Stock Issued Pursuant to the Terms of Notes [Member] | ||||
Notes Payable and Accrued Interest [Member] | Accrued Interest [Member] | ||||||||||||||||
NOTE F - EQUITY TRANSACTIONS (Details) [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Stockholders' Equity, Reverse Stock Split | ' | ' | 'one for seventy-five | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Preferred Stock, Shares Authorized | 10,000,000 | ' | 10,000,000 | ' | ' | 35,850 | 35,850 | 1,000 | 1,000 | 200,000 | 200,000 | ' | ' | ' | ' | ' | ' |
Preferred Stock, Par or Stated Value Per Share (in Dollars per share) | $0.00 | ' | $0.00 | ' | ' | $100 | $100 | $0.00 | $0.00 | $0.00 | $0.00 | ' | ' | ' | ' | ' | ' |
Preferred Stock, Liquidation Preference Per Share (in Dollars per share) | ' | ' | ' | ' | ' | ' | ' | $10,000 | ' | $10 | ' | ' | ' | ' | ' | ' | ' |
Common Stock, Shares Authorized | 740,000,000 | ' | 740,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Common Stock, Par or Stated Value Per Share (in Dollars per share) | $0.00 | ' | $0.00 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Preferred Stock, Shares Issued | ' | ' | ' | ' | ' | 125 | 125 | 157 | 157 | 0 | 0 | ' | ' | ' | ' | ' | ' |
Preferred Stock, Shares Outstanding | ' | ' | ' | ' | ' | 125 | 125 | 157 | 157 | 0 | 0 | ' | ' | ' | ' | ' | ' |
Common Stock, Shares, Issued | 17,388,205 | ' | 14,131,242 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Common Stock, Shares, Outstanding | 17,388,205 | ' | 14,131,242 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Dividends Payable, Current (in Dollars) | ' | ' | ' | ' | ' | $6,427 | $6,045 | $646,562 | $567,847 | ' | ' | ' | ' | ' | ' | ' | ' |
Preferred Dividends Reclassifed (in Dollars) | ' | ' | ' | ' | ' | ' | ' | 78,715.07 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Preferred Stock Dividends, Shares | ' | ' | ' | ' | ' | ' | ' | 7.87 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Preferred stock, shares to be issued | 64.8 | ' | 56.8 | 27,500 | ' | ' | ' | 64.8 | 56.78 | ' | ' | ' | ' | ' | ' | ' | ' |
Share-based Compensation (in Dollars) | 119,037 | 428,174 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Stock Issued During Period, Shares, Other (in Shares) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 555,110 | ' | ' | 100,000 | 100,000 | 71,402 |
Stock Issued During Period, Shares, New Issues | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,886,686 | ' | ' | ' | ' |
Number of Accredited Investors | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 14 | ' | ' | ' | ' |
Proceeds from Issuance of Common Stock (in Dollars) | 513,161 | 455,211 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 513,163 | ' | ' | ' | ' |
Common Stock, Shares Subscribed but Unissued | 111,080 | ' | 625,340 | ' | ' | ' | ' | ' | ' | ' | ' | ' | 83,670 | ' | ' | ' | ' |
Stock Issued During Period, Shares, Conversion of Convertible Securities (in Shares) | ' | ' | ' | 401,693 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt Conversion, Converted Instrument, Amount (in Dollars) | ' | ' | ' | 110,803 | 62,402 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Stock Issued During Period, Value, Other (in Dollars) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 39,533 | 39,533 | 26,872 |
Stock Issued During Period, Shares, Issued for Services | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 370,562 | ' | ' | ' |
Stock Issued During Period, Value, Issued for Services (in Dollars) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $112,358 | ' | ' | ' |
NOTE_G_NONCONTROLLING_INTEREST2
NOTE G - NONCONTROLLING INTEREST (Details) - Schedule of Noncontrolling Interest (USD $) | 3 Months Ended | 6 Months Ended | ||
Oct. 31, 2013 | Oct. 31, 2012 | Oct. 31, 2013 | Oct. 31, 2012 | |
Schedule of Noncontrolling Interest [Abstract] | ' | ' | ' | ' |
Balance at April 30, 2013 | ' | ' | $723,191 | ' |
Noncontrolling interestbs share of losses | -18,304 | -9,700 | -27,969 | -9,771 |
Balance at October 31, 2013 | $695,223 | ' | $695,223 | ' |
NOTE_H_FAIR_VALUE_MEASUREMENTS2
NOTE H - FAIR VALUE MEASUREMENTS (Details) - Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis (USD $) | Oct. 31, 2013 | Apr. 30, 2013 |
NOTE H - FAIR VALUE MEASUREMENTS (Details) - Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | ' | ' |
Derivative liabilities | $529,190 | $378,802 |
Fair Value, Inputs, Level 1 [Member] | ' | ' |
NOTE H - FAIR VALUE MEASUREMENTS (Details) - Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | ' | ' |
Derivative liabilities | 0 | ' |
Fair Value, Inputs, Level 2 [Member] | ' | ' |
NOTE H - FAIR VALUE MEASUREMENTS (Details) - Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | ' | ' |
Derivative liabilities | 0 | ' |
Fair Value, Inputs, Level 3 [Member] | ' | ' |
NOTE H - FAIR VALUE MEASUREMENTS (Details) - Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | ' | ' |
Derivative liabilities | $529,190 | ' |
NOTE_H_FAIR_VALUE_MEASUREMENTS3
NOTE H - FAIR VALUE MEASUREMENTS (Details) - Schedule of Derivative Liabilities at Fair Value (USD $) | 6 Months Ended |
Oct. 31, 2013 | |
Schedule of Derivative Liabilities at Fair Value [Abstract] | ' |
Derivative liability, Beginning of Period | $378,802 |
Derivative liability, Increased During Period | 468,063 |
Derivative liability, Decreased During Period | 317,675 |
Derivative liability, End of Period | $529,190 |
NOTE_I_NONCASH_FINANCIAL_INFOR1
NOTE I - NON-CASH FINANCIAL INFORMATION (Details) (USD $) | 6 Months Ended | |||||
Oct. 31, 2013 | Oct. 31, 2012 | Oct. 31, 2013 | Oct. 30, 2013 | Oct. 31, 2013 | Oct. 31, 2013 | |
Conversion of $173,995 [Member] | Settlement of Accounts Payable [Member] | Settlement of Accounts Payable [Member] | Derivative Liabilities Related to Notes Payable [Member] | |||
Notes Payable and Accrued Interest [Member] | ||||||
NOTE I - NON-CASH FINANCIAL INFORMATION (Details) [Line Items] | ' | ' | ' | ' | ' | ' |
Dividends, Preferred Stock | $79,097 | $79,527 | ' | ' | ' | ' |
Debt Conversion, Original Debt, Amount | ' | ' | 173,205 | ' | ' | 130,269 |
Debt Instrument, Convertible, Beneficial Conversion Feature | 72,995 | ' | ' | ' | ' | ' |
Stock Issued During Period, Shares, Other (in Shares) | ' | ' | ' | 100,000 | 100,000 | ' |
Stock Issued During Period, Value, Other | ' | ' | ' | $39,533 | $39,533 | ' |
Stock Issued During Period, Shares, Conversion of Convertible Securities (in Shares) | ' | ' | 401,693 | ' | ' | ' |
Stock to be Issued (in Shares) | ' | ' | 27,500 | ' | ' | ' |
NOTE_J_SUBSEQUENT_EVENTS_Detai
NOTE J - SUBSEQUENT EVENTS (Details) (USD $) | 2 Months Ended | 6 Months Ended | |||||||
Dec. 17, 2013 | Dec. 17, 2013 | Dec. 17, 2013 | Dec. 17, 2013 | Dec. 17, 2013 | Dec. 17, 2013 | Oct. 30, 2013 | Oct. 31, 2013 | Oct. 31, 2013 | |
Subsequent Event [Member] | Subsequent Event [Member] | Subsequent Event [Member] | Subsequent Event [Member] | Subsequent Event [Member] | Subsequent Event [Member] | Settlement of Accounts Payable [Member] | Settlement of Accounts Payable [Member] | Stock Issued Which Was Previously Classified as To Be Issued [Member] | |
Settlement of Accounts Payable [Member] | Notes Payable and Accrued Interest [Member] | Terms of Notes Payable [Member] | Consulting Agreements [Member] | Stock Issued Which Was Previously Classified as To Be Issued [Member] | |||||
NOTE J - SUBSEQUENT EVENTS (Details) [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Stock Issued During Period, Shares, Restricted Stock Award, Gross | ' | ' | ' | ' | ' | 580,570 | ' | ' | ' |
Number of Accredited Investors | ' | ' | ' | ' | ' | 7 | ' | ' | ' |
Stock Issued During Period, Value, Restricted Stock Award, Gross (in Dollars) | ' | ' | ' | ' | ' | $154,065 | ' | ' | ' |
Common stock to be issued, shares | ' | ' | ' | ' | ' | 183,487 | ' | ' | ' |
Stock Issued During Period, Shares, Other | 10,000 | ' | ' | ' | 91,382 | ' | 100,000 | 100,000 | 555,110 |
Stock Issued During Period, Value, Other (in Dollars) | 5,290 | ' | ' | ' | ' | ' | 39,533 | 39,533 | ' |
Stock Issued During Period, Shares, Conversion of Convertible Securities | ' | 182,169 | 11,226 | ' | ' | ' | ' | ' | ' |
Debt Conversion, Converted Instrument, Amount (in Dollars) | ' | 56,190 | ' | ' | ' | ' | ' | ' | ' |
Stock Issued During Period, Shares, Issued for Services | ' | ' | ' | 232,164 | ' | ' | ' | ' | ' |
Stock Issued During Period, Value, Issued for Services (in Dollars) | ' | ' | ' | $69,649 | ' | ' | ' | ' | ' |
NOTE_K_GOING_CONCERN_MATTERS_D
NOTE K - GOING CONCERN MATTERS (Details) (USD $) | 3 Months Ended | 6 Months Ended | |||
Oct. 31, 2013 | Oct. 31, 2012 | Oct. 31, 2013 | Oct. 31, 2012 | Apr. 30, 2013 | |
Going Concern Disclosure [Abstract] | ' | ' | ' | ' | ' |
Retained Earnings (Accumulated Deficit) | ($42,228,720) | ' | ($42,228,720) | ' | ($40,991,658) |
Net Income (Loss) Attributable to Parent | ($737,302) | ($879,198) | ($1,237,063) | ($1,941,177) | ' |