Dalrada Financial (DFCO) 10-K 31 Jan 20 2019 FY Annual report Financial data

Cover

Cover - USD ($)	12 Months Ended
	Jun. 30, 2019	Jan. 30, 2020	Mar. 31, 2019
Cover [Abstract]
Document Type	10-K
Amendment Flag	false
Document Period End Date	Jun. 30, 2019
Document Fiscal Period Focus	FY
Document Fiscal Year Focus	2019
Current Fiscal Year End Date	--06-30
Entity File Number	000-12641
Entity Registrant Name	DALRADA FINANCIAL CORP
Entity Central Index Key	0000725394
Entity Well-known Seasoned Issuer	No
Entity Voluntary Filers	No
Entity Current Reporting Status	No
Entity Interactive Data Current	No
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Public Float			$ 1,076,915
Entity Common Stock, Shares Outstanding		48,028,128
Incorporation state	DE

Consolidated Balance Sheets

Consolidated Balance Sheets - USD ($)	Jun. 30, 2019	Jun. 30, 2018
Current assets
Cash and cash equivalents	$ 963	$ 5,486
Accounts receivable	27,959	0
Inventory	18,768	0
Total current assets	47,690	5,486
Property and equipment	5,500	0
Total assets	53,190	5,486
Current liabilities
Accounts payable and accrued liabilities	73,681	1,073
Accrued payroll taxes, penalties and interest	10,980,278	12,392,022
Accounts payable and accrued liabilities - related parties	417,133	37,469
Accrued compensation	0	1,615,000
Notes payable - related parties	342,741	0
Convertible note payable - related party	1,875,000	0
Total liabilities	13,688,833	14,045,564
Commitments and contingencies (Note 9)
STOCKHOLDERS' DEFICIT
Preferred stock Authorized: 100,000 shares with a par value of $1,000 per share, Issued and outstanding: nil and nil shares, respectively	0	0
Common stock Authorized: 1,000,000,000 shares with a par value of $0.005 per share Issued and outstanding: 48,281,128 and 47,281,128 shares, respectively	241,406	236,406
Additional paid-in capital	91,086,179	91,052,594
Accumulated deficit	(104,963,228)	(105,329,078)
Total stockholders' deficit	(13,635,643)	(14,040,078)
Total liabilities and stockholders' deficit	$ 53,190	$ 5,486

Consolidated Balance Sheets (Pa

Consolidated Balance Sheets (Parenthetical) - $ / shares	Jun. 30, 2019	Jun. 30, 2018
Statement of Financial Position [Abstract]
Preferred stock, par value	$ 1,000	$ 1,000
Preferred stock, shares authorized	100,000	100,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value	$ .005	$ .005
Common stock, shares authorized	1,000,000,000	1,000,000,000
Common stock, shares issued	48,281,128	47,281,128
Common stock, shares outstanding	48,281,128	47,281,128

Consolidated Statements of Oper

Consolidated Statements of Operations - USD ($)	12 Months Ended
	Jun. 30, 2019	Jun. 30, 2018
Income Statement [Abstract]
Revenue	$ 72,155	$ 0
Cost of revenue	74,996	0
Gross loss	(2,841)	0
Selling, general and administrative	721,847	91,983
Research and development	50,050	0
Total operating expense	771,897	91,983
Loss before other income (expense)	(774,738)	(91,983)
Expenses incurred on proposed acquisition	(270,577)	0
Interest expense	(853,175)	(945,238)
Gain on expiration of accrued tax liability	2,264,340	0
Total other income (expense)	1,140,588	(945,238)
Net income (loss)	$ 365,850	$ (1,037,221)
Net income (loss) per share, basic	$ 0.01	$ (0.02)
Net income (loss) per share, diluted	$ 0	$ (0.02)
Weighted average common shares outstanding, basic	47,429,073	47,281,128
Weighted average common shares outstanding, diluted	102,576,132	47,281,128

Consolidated Statements of Chan

Consolidated Statements of Changes in Stockholders' Deficit - USD ($)	Common Stock	Additional Paid-In Capital	Retained Earnings / Accumulated Deficit	Total
Beginning balance, shares at Jun. 30, 2017	47,281,128
Beginning balance, value at Jun. 30, 2017	$ 236,406	$ 91,052,594	$ (104,291,857)	$ (13,002,857)
Net loss			(1,037,221)	(1,037,221)
Ending balance, shares at Jun. 30, 2018	47,281,128
Ending balance, value at Jun. 30, 2018	$ 236,406	91,052,594	(105,329,078)	(14,040,078)
Stock issued to related party - reimburse expenses, shares	1,000,000
Stock issued to related party - reimburse expenses, value	$ 5,000	33,585		38,585
Net loss			365,850	365,850
Ending balance, shares at Jun. 30, 2019	48,281,128
Ending balance, value at Jun. 30, 2019	$ 241,406	$ 91,086,179	$ (104,963,228)	$ (13,635,643)

Consolidated Statements of Cash

Consolidated Statements of Cash Flows - USD ($)	12 Months Ended
	Jun. 30, 2019	Jun. 30, 2018
Operating activities
Net income (loss) for the year	$ 365,850	$ (1,037,221)
Changes in operating assets and liabilities:
Accounts receivable	(27,959)	0
Inventory	(18,768)	0
Accounts payable and accrued liabilities	10,229	0
Accrued payroll taxes, penalties and interest	(1,411,744)	945,238
Accrued compensation	260,000	60,000
Net cash used in operating activities	(822,392)	(31,983)
Investing Activities
Purchase of property and equipment	(5,500)	0
Net cash used in investing activities	(5,500)	0
Financing activities
Related party advances and notes payable - related parties	823,369	37,469
Net cash provided by financing activities	823,369	37,469
Increase (decrease) in cash	(4,523)	5,486
Cash, beginning of period	5,486	0
Cash, end of period	963	5,486
Supplemental Disclosures
Interest paid	0	0
Income tax paid	0	0
Non-cash investing and financing activities:
Conversion of accrued wages to convertible note payable - related party	1,875,000	0
Stock issued to related party - reimburse expenses	$ 38,585	$ 0

1. Organization and Nature of O

1. Organization and Nature of Operations	12 Months Ended
	Jun. 30, 2019
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Organization and Nature of Operations	1. Organization and Nature of Operations Dalrada Financial Corporation (the “Company”) was incorporated in September 1982 under the laws of the State of California, and reincorporated in May 1983 under the laws of the State of Delaware. In June 2018, the Company created a new subsidiary, Dalrada Precision Corp. (“Dalrada Precision”), a mechanical contract provider. It extends the client’s engineering and operations team by helping devise bespoke manufacturing solutions tailored to its products. Dalrada Precision can enter at any stage of the product lifecycle from concept and design to mass production and logistics. In October 2018, the Company created a new subsidiary, Dalrada Health Products Corp (“Dalrada Health”). Dalrada Health will partner with client companies for the distribution of medical disposables, hospital equipment & furniture, medical devices, laboratory and dental products. In May 2019, Dalrada Health acquired a new subsidiary, C2C Life Sciences, Inc. (“C2C”). On November 1, 2019, the acquisition was rescinded, as the Company never gained control over C2C. Such costs incurred in connection with this rescinded acquisition, have been reflected in these financials as other expense. The Company's principal executive offices are located at 600 La Terraza Blvd., Escondido, California 92025. Going Concern These consolidated financial statements have been prepared on a going concern basis, which implies that the Company will continue to realize its assets and discharge its liabilities in the normal course of business. As at June 30, 2019, the Company has a working capital deficit of $13,641,143 and an accumulated deficit of $104,963,228. The continuation of the Company as a going concern is dependent upon the continued financial support from its management, and its ability to identify future investment opportunities and obtain the necessary debt or equity financing, and generating profitable operations from the Company’s future operations. These factors raise substantial doubt regarding the Company’s ability to continue as a going concern. These consolidated financial statements do not include any adjustments to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

2. Summary of Significant Accou

2. Summary of Significant Accounting Policies	12 Months Ended
	Jun. 30, 2019
Accounting Policies [Abstract]
Summary of Significant Accounting Policies	2. Summary of Significant Accounting Policies (a) Basis of Presentation These consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States (“US GAAP”) and are expressed in U.S. dollars. The Company’s fiscal year end is June 30. (b) Principles of Consolidation These consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries: Dalrada Precision, a company incorporated in the State of California, since June 25, 2018 (date of incorporation), and Dalrada Health, a company incorporated in the State of California, since October 2, 2018 (date of incorporation). All inter-company transactions and balances have been eliminated on consolidation. (c) Use of Estimates The preparation of these consolidated financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. The Company regularly evaluates estimates and assumptions related to the valuation of inventory, valuation of accrued payroll tax liabilities, variables used in the computation of share-based compensation, and deferred income tax asset valuation allowances. The Company bases its estimates and assumptions on current facts, historical experience and various other factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources. The actual results experienced by the Company may differ materially and adversely from the Company’s estimates. To the extent there are material differences between the estimates and the actual results, future results of operations will be affected. (d) Cash and Cash Equivalents The Company considers all highly liquid instruments with a maturity of three months or less at the time of issuance to be cash equivalents. (e) Inventory Inventory is comprised of goods purchased for resale, and is recorded at the lower of cost or net realizable value on a first-in first-out basis. The Company establishes inventory reserves for estimated obsolete or unsaleable inventory equal to the difference between the cost of inventory and the estimated realizable value based upon assumptions about future market conditions. (f) Equipment Equipment is comprised of machinery and is recorded at the lower of cost or net book value and amortized on a straight-line basis over an estimated useful life of three to five years. (g) Financial Instruments Pursuant to ASC 820, Fair Value Measurements and Disclosures Level 1 Level 1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities. Level 2 Level 2 applies to assets or liabilities for which there are inputs other than quoted prices that are observable for the asset or liability such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data. Level 3 Level 3 applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities. The Company’s financial instruments consist principally of cash, accounts receivable, accounts payable and accrued liabilities, notes payable, and amounts due to related parties. Pursuant to ASC 820, the fair value of cash is determined based on “Level 1” inputs, which consist of quoted prices in active markets for identical assets. The recorded values of all other financial instruments approximate their current fair values because of their nature and respective maturity dates or durations. (h) Income Taxes The Company accounts for income taxes using the asset and liability method in accordance with ASC 740, Accounting for Income Taxes (i) Revenue Recognition The Company recognizes and accounts for revenue in accordance with ASC 606 as a principal on the sale of goods. Pursuant to ASC 606 , The Company’s revenue is derived from the sales of its products, which represents net sales recorded in the Company’s consolidated statements of operations. Product sales are recognized when performance obligations under the terms of the contract with the customer are satisfied. Typically, this would occur upon transfer of control, including passage of title to the customer and transfer of risk of loss related to those goods. The Company measures revenue as the amount of consideration to which it expects to be entitled in exchange for transferring goods (transaction price). The Company records reductions to revenue for estimated customer returns, allowances, markdowns and discounts. The Company bases its estimates on historical rates of customer returns and allowances as well as the specific identification of outstanding returns, markdowns and allowances that have not yet been received by the Company. The actual amount of customer returns and allowances is inherently uncertain and may differ from the Company’s estimates. If the Company determines that actual or expected returns or allowances are significantly higher or lower than the reserves it established, it would record a reduction or increase, as appropriate, to net sales in the period in which it makes such a determination. Reserves for returns, and markdowns are included within accrued expenses and other liabilities. Allowance and discounts are recorded in accounts receivable, net and the value of inventory associated with reserves for sales returns are included within prepaid expenses and other current assets on the consolidated balance sheets. (j) Stock-based Compensation The Company records stock-based compensation in accordance with ASC 718, Compensation – Stock Compensation (k) Comprehensive Loss ASC 220, Comprehensive Income (l) Basic and Diluted Net Loss per Share The Company computes net income (loss) per share in accordance with ASC 260, Earnings per Share Year Ended June 30, 2019 Weighted average number of common shares outstanding - Basic 47,429,073 Potentially dilutive common stock equivalents (convertible note payable - related party) 55,147,059 Weighted average number of common shares outstanding - Diluted 102,576,132 There were no outstanding dilutive securities during the year ended June 30, 2018. There were no adjustments to the numerator during the year ended June 30, 2019. Recent Accounting Pronouncements In August 2018, the FASB issued guidance to improve the effectiveness of fair value measurement disclosures by removing or modifying certain disclosure requirements and adding other requirements. The guidance is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019, with early adoption permitted. Certain amendments should be applied prospectively, while all other amendments should be applied retrospectively to all periods presented. The Company is currently evaluating the impact of the new guidance. In February 2018, the FASB issued guidance that permits the Company to reclassify disproportionate tax effects in accumulated other comprehensive income caused by the Tax Cuts and Jobs Act of 2017 to retained earnings. The guidance is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018, with early adoption permitted. The adoption of this standard is not expected to have a material impact on the Company’s consolidated financial statements. In July 2017, the FASB issued ASU 2017-11 which simplifies the accounting for certain financial instruments with down round features. The new standard will reduce income statement volatility for companies that issue warrants and convertible instruments containing such features. The guidance is effective for fiscal years beginning after December 15, 2018 with early adoption permitted. The adoption of this standard is not expected to have a material impact on the Company’s consolidated financial statements. In June 2016, the FASB issued a new credit loss standard that replaces the incurred loss impairment methodology in current GAAP. The new impairment model requires immediate recognition of estimated credit losses expected to occur for most financial assets and certain other instruments. It is effective for annual reporting periods beginning after December 15, 2019 and interim periods within those annual periods, with early adoption permitted. Entities will apply the standard’s provisions as a cumulative-effect adjustment to retained earnings as of the beginning of the first effective reporting period. The Company is currently evaluating the impact of the new guidance. In February 2016, the FASB issued new lease accounting guidance in ASU No. 2016-02, “ Leases The Company has implemented all new accounting pronouncements that are in effect and that may impact its financial statements and does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations.

3. Accrued Payroll Taxes

3. Accrued Payroll Taxes	12 Months Ended
	Jun. 30, 2019
Payables and Accruals [Abstract]
Accrued Payroll Taxes	3. Accrued Payroll Taxes As of June 30, 2019, and 2018, the Company had $10,980,278 and $12,392,022, respectively, of accrued payroll taxes, penalties and interest relating to calendar years 2004 - 2007. The total balance for accrued payroll taxes has accumulated on a quarterly basis beginning on their respective quarterly filing dates. Accrued interest is compounded daily at an estimated effective interest rate of 7.33%. The quarterly sub-totals that make up the $10,980,278 balance have a calculated expiration date of 10 years according to the Internal Revenue Service statute of limitations. As the tax periods surpass their estimated expiration date, the Company removes the liability from the consolidated balance sheets, and an equivalent amount is recognized as “Gain on expiration of accrued payroll taxes” within other income on the consolidated statements of operations. For fiscal years ending June 30, 2019 and 2018, the Company recognized $2,264,340 and $0, respectively, within “Gain on expiration of accrued payroll taxes” as a result of quarterly tax liabilities that expired during the fiscal years. The amount owing may be subject to additional late filing fees and penalties that are not quantifiable as at the date of these consolidated financial statements. In addition, the Company periodically reviews the historical filings in determining if the statute has been paused or extended by the Internal Revenue Service.

4. Notes Payable - Related Part

4. Notes Payable - Related Parties	12 Months Ended
	Jun. 30, 2019
Debt Disclosure [Abstract]
Notes Payable - Related Parties	4. Notes Payable – Related Parties a) During the year ended June 30, 2019, the Company issued a $38,615 promissory note to a related party for compensation paid by the related party on behalf of the Company. Under the terms of the note, the amount due is unsecured, bears interest at 3% per annum, and is due 180 days from the date of issuance. As at June 30, 2019, the outstanding balance of the promissory note was $39,195 (2018 - $nil). b) During the year ended June 30, 2019, the Company issued a $37,469 promissory note to a related party for legal services and other expenses incurred to reinstate the Company to a current status with the state of Delaware. Under the terms of the note, the amount due is unsecured, bears interest at 3% per annum, and is due 180 days from the date of issuance. As at June 30, 2019, the outstanding balance of the promissory note was $37,469 (2018 - $37,469, reflected as accounts payable accrued liabilities related party). c) As at June 30, 2019, the Company owed $2,250 (2018 – $nil) to a related party company controlled by the Chief Executive Officer of the Company for management fees, which consists of accounting and administrative services for which the Company is charged $4,500 on a monthly basis. The amount is unsecured, bears interest at 3% per annum, and due 360 days from the date of issuance. d) As at June 30, 2019, the Company owed $1,630 (2018 – $nil) to a related party for reimbursement of expenses paid by the related party on behalf of the Company related to the proposed C2C acquisition which did not occur. The amount is unsecured, bears interest at 3% per annum, and due 360 days from the date of issuance. e) As at June 30, 2019, the Company owed $262,197 (2018 – $nil) to a related party for reimbursement of compensation to employees and payroll services paid by the related party on behalf of the Company in connection with the C2C acquisition which did not occur. The amount is unsecured, bears interest at 3% per annum, and due 360 days from the date of issuance.

5. Convertible Note Payable - R

5. Convertible Note Payable - Related Parties	12 Months Ended
	Jun. 30, 2019
Debt Disclosure [Abstract]
Convertible Note Payable - Related Parties	5. Convertible Note Payable – Related Parties As at June 30, 2019, the Company owed $1,875,000 (2018 – $1,615,000, reflected as accrued compensation) to the Chief Executive Officer of the Company for compensation. The amount is unsecured, bears interest at 3% per annum, due one year from the date of issuance. On June 30, 2019, the Company issued note agreement which included a conversion feature of the outstanding balance at $0.034 per share. As the conversion price was equal to the fair value of the common shares on the date of the agreement, there was no beneficial conversion feature. During the year ended June 30, 2019, the Company incurred $260,000 (2018 - $60,000) in consulting fees to the Chief Executive Officer of the Company. At the time, the Company didn’t have a formal arrangement with the Chief Executive Officer for the payment of such.

6. Common Shares

6. Common Shares	12 Months Ended
	Jun. 30, 2019
Equity [Abstract]
Common Shares	6. Common Shares On May 7, 2019, the Company issued 1,000,000 common shares to a direct relative of the Chief Executive Officer for reimbursement of expenses. The fair value of the common stock issued was similar to that of the fair market value on the date of issuance.

7. Related Party Transactions

7. Related Party Transactions	12 Months Ended
	Jun. 30, 2019
Related Party Transactions [Abstract]
Related Party Transactions	7. Related Party Transactions As at June 30, 2019, the Company owed $417,133 (2018 - $nil) to related parties for reimbursement of various operating expenses, which has been recorded in accounts payable and accrued liabilities – related parties. This amount includes $27,000 of management fees, which consists of accounting and administrative services to Trucept Inc., a related party company controlled by the Chief Executive Officer of the Company. The management fee agreement calls for monthly payments of $4,500. The agreement is ongoing until terminated by either party. See Notes 4, 5, 6 and 9 for additional related party transactions.

8. Income Taxes

8. Income Taxes	12 Months Ended
	Jun. 30, 2019
Income Tax Disclosure [Abstract]
Income Taxes	8. Income Taxes We file income tax returns in the United States federal jurisdiction and in various state and local jurisdictions. In the normal course of business, we are subject to examination by taxing authorities. The tax years ending 2017 through 2019 remain subject to examination for federal tax purposes and remain subject to examination in significant state tax jurisdictions. The Company has yet to file their income tax return for the year ended June 30, 2019. As of June 30, 2019, the Company had federal and state net operating loss carry forwards of $818,000 that may be offset against future taxable income which will begin to expire in 2038 through 2041. The reconciliation of income tax expense computed at the U.S. federal statutory rate to the income tax provision for the years ended June 30, 2019 and 2018 is as follows: 2019 2018 Current: Federal $ – $ – State – – Foreign – – – – Deferred: Federal (165,038 ) (6,716 ) State (45,852 ) (1,866 ) (210,890 ) (8,582 ) Valuation allowance 210,890 8,582 Total provision for income taxes $ – $ – Deferred income taxes reflect the net tax effects of: (a) temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes; and (b) operating loss and tax credit carry-forwards. We record net deferred tax assets to the extent we believe these assets will more likely than not be realized. In making such determination, we consider all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax planning strategies and recent financial operations. Significant components of deferred tax assets as of June 30, 2019 and 2018 were as follows: 2019 2018 Net Operating Loss Carryforwards $ 219,472 $ 8,582 Gross Deferred Tax Assets 219,472 8,582 Valuation Allowance (219,472 ) (8,582 ) Net Deferred Tax Assets $ – $ – Reconciliation of the statutory federal income tax to the Company's effective tax: The difference in the effective rate and the statutory rate is due to permanent differences, primarily deductibility of penalties and interest on accrued payroll tax liabilities and the gains related to the expiration of the statute of limitations for accrued payroll tax liabilities.

9. Commitments and Contingencie

9. Commitments and Contingencies	12 Months Ended
	Jun. 30, 2019
Commitments and Contingencies Disclosure [Abstract]
Commitments and Contingencies	9. Commitments and Contingencies (a) On September 1, 2019, the Company, entered into a three-year lease agreement to lease a commercial building in Escondido, California. The building is owned by related party. Under the terms of the lease agreement, the Company is committed to the following minimum lease payments: Fiscal year ended $ June 30, 2020 12,804 June 30, 2021 17,457 June 30, 2022 17,980 June 30, 2023 18,112 Total minimum lease payments 66,353

10. Subsequent Events

10. Subsequent Events	12 Months Ended
	Jun. 30, 2019
Subsequent Events [Abstract]
Subsequent Events	10. Subsequent Events (a) On July 1, 2019, the Company formalized an employment agreement with its Chief Executive Officer, which entitles him to compensation of three hundred and ninety-three thousand dollars ($393,000.00) per year. Annual increases will be up to 10% based performance criteria to be determined at a later date. He will be issued common stock of the Company sufficient to provide a 10% ownership position post reverse split which shares be maintained for a period of two years. In addition to all other benefits and compensation, he shall be eligible for a quarterly bonus of $47,000 based on if the Company achieves a net profit for that quarter. (b) On September 30, 2019, the Company issued a $131,265 promissory note to a related party for compensation paid by the related party on behalf of the Company. Under the terms of the note, the amount due is unsecured, bears interest at 3% per annum, and is due 360 days from the date of issuance. (c) On September 30, 2019, the Company issued a $2,075 promissory note to a related party for reimbursement of expenses paid by the related party on behalf of the Company related to the proposed C2C acquisition which did not occur. Under the terms of the note, the amount due is unsecured, bears interest at 3% per annum, and is due 360 days from the date of issuance. (d) On September 30, 2019, the Company issued a $3,375 promissory note to a related party company controlled by the Chief Executive Officer of the Company for management fees, which consists of accounting and administrative services. Under the terms of the note, the amount due is unsecured, bears interest at 3% per annum, and is due 360 days from the date of issuance. (e) On September 30, 2019, the Company issued a $36,370 promissory note to a related party for reimbursement of operating expenses paid by the related party on behalf of the Company. Under the terms of the note, the amount due is unsecured, bears interest at 3% per annum, and is due 360 days from the date of issuance. (f) On September 30, 2019, the Company issued a $1,865 promissory note to a related party for reimbursement of expenses paid by the related party on behalf of the Company related to the proposed C2C acquisition which did not occur. Under the terms of the note, the amount due is unsecured, bears interest at 3% per annum, and is due 360 days from the date of issuance. (g) On September 30, 2019, the Company issued a $93,137 promissory note to a related party for reimbursement of operating expenses paid by the related party on behalf of the Company. Under the terms of the note, the amount due is unsecured, bears interest at 3% per annum, and is due 360 days from the date of issuance. (h) Likido Ltd. (HQ) On December 6, 2019, Dalrada, via its wholly owned subsidiary, Dalrada Precision, acquired, by stock exchange agreement, one hundred percent of Likido Ltd. (HQ) in exchange of 6,118,000 shares of the Company’s common stock. Likido, a United Kingdom engineering-design company based in Edinburgh, Scotland. Likido is an international technology company, developing advanced solutions for the harvesting and recycling of energy. Using its novel, heat pump systems (patent pending), Likido is working to revolutionize the renewable energy sector with the provision of innovative modular process technologies to maximize the capture and reuse of thermal energy for integrated heating and cooling applications. With uses across industrial, commercial and residential sectors, Likido provides cost savings and the minimized carbon emissions across global supply chains. Likido's technologies enable the effective recovery and recycling of process energy, mitigating against climate change and enhancing quality of life through the provision of low-carbon heating and cooling systems. In connection with the purchase of Likido, the Company is obligated to fund operations for a total up to $600,000. Subsequent to June 30, 2019, the Company incurred research and development expenses of $260,000. On July 1, 2019, the Company entered into an employment agreement with the Chief Executive Officer of the Company. Pursuant to the agreement, the Company will compensate the Chief Executive Officer a base salary of $393,000 per annum, annual increases of 10% and a quarterly bonus based on whether the Company achieve a net profit. He will be issued common stock of the Company sufficient to provide a 10% ownership position post reverse split which shares be maintained for a period of two years. In addition to all other benefits and compensation, he shall be eligible for a quarterly bonus of $47,000 based on if the Company achieves a net profit for that quarter.

2. Summary of Significant Acc_2

2. Summary of Significant Accounting Policies (Policies)	12 Months Ended
	Jun. 30, 2019
Accounting Policies [Abstract]
Basis of Presentation	(a) Basis of Presentation These consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States (“US GAAP”) and are expressed in U.S. dollars. The Company’s fiscal year end is June 30.
Principles of Consolidation	(b) Principles of Consolidation These consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries: Dalrada Precision, a company incorporated in the State of California, since June 25, 2018 (date of incorporation), and Dalrada Health, a company incorporated in the State of California, since October 2, 2018 (date of incorporation). All inter-company transactions and balances have been eliminated on consolidation.
Use of Estimates	(c) Use of Estimates The preparation of these consolidated financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. The Company regularly evaluates estimates and assumptions related to the valuation of inventory, valuation of accrued payroll tax liabilities, variables used in the computation of share-based compensation, and deferred income tax asset valuation allowances. The Company bases its estimates and assumptions on current facts, historical experience and various other factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources. The actual results experienced by the Company may differ materially and adversely from the Company’s estimates. To the extent there are material differences between the estimates and the actual results, future results of operations will be affected.
Cash and Cash Equivalents	(d) Cash and Cash Equivalents The Company considers all highly liquid instruments with a maturity of three months or less at the time of issuance to be cash equivalents.
Inventory	(e) Inventory Inventory is comprised of goods purchased for resale, and is recorded at the lower of cost or net realizable value on a first-in first-out basis. The Company establishes inventory reserves for estimated obsolete or unsaleable inventory equal to the difference between the cost of inventory and the estimated realizable value based upon assumptions about future market conditions.
Equipment	(f) Equipment Equipment is comprised of machinery and is recorded at the lower of cost or net book value and amortized on a straight-line basis over an estimated useful life of three to five years.
Financial Instruments	(g) Financial Instruments Pursuant to ASC 820, Fair Value Measurements and Disclosures Level 1 Level 1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities. Level 2 Level 2 applies to assets or liabilities for which there are inputs other than quoted prices that are observable for the asset or liability such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data. Level 3 Level 3 applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities. The Company’s financial instruments consist principally of cash, accounts receivable, accounts payable and accrued liabilities, notes payable, and amounts due to related parties. Pursuant to ASC 820, the fair value of cash is determined based on “Level 1” inputs, which consist of quoted prices in active markets for identical assets. The recorded values of all other financial instruments approximate their current fair values because of their nature and respective maturity dates or durations.
Income Taxes	(h) Income Taxes The Company accounts for income taxes using the asset and liability method in accordance with ASC 740, Accounting for Income Taxes
Revenue Recognition	(i) Revenue Recognition The Company recognizes and accounts for revenue in accordance with ASC 606 as a principal on the sale of goods. Pursuant to ASC 606 , The Company’s revenue is derived from the sales of its products, which represents net sales recorded in the Company’s consolidated statements of operations. Product sales are recognized when performance obligations under the terms of the contract with the customer are satisfied. Typically, this would occur upon transfer of control, including passage of title to the customer and transfer of risk of loss related to those goods. The Company measures revenue as the amount of consideration to which it expects to be entitled in exchange for transferring goods (transaction price). The Company records reductions to revenue for estimated customer returns, allowances, markdowns and discounts. The Company bases its estimates on historical rates of customer returns and allowances as well as the specific identification of outstanding returns, markdowns and allowances that have not yet been received by the Company. The actual amount of customer returns and allowances is inherently uncertain and may differ from the Company’s estimates. If the Company determines that actual or expected returns or allowances are significantly higher or lower than the reserves it established, it would record a reduction or increase, as appropriate, to net sales in the period in which it makes such a determination. Reserves for returns, and markdowns are included within accrued expenses and other liabilities. Allowance and discounts are recorded in accounts receivable, net and the value of inventory associated with reserves for sales returns are included within prepaid expenses and other current assets on the consolidated balance sheets.
Stock-based Compensation	(j) Stock-based Compensation The Company records stock-based compensation in accordance with ASC 718, Compensation – Stock Compensation
Comprehensive Loss	(k) Comprehensive Loss ASC 220, Comprehensive Income
Basic and Diluted Net Loss per Share	(l) Basic and Diluted Net Loss per Share The Company computes net income (loss) per share in accordance with ASC 260, Earnings per Share Year Ended June 30, 2019 Weighted average number of common shares outstanding - Basic 47,429,073 Potentially dilutive common stock equivalents (convertible note payable - related party) 55,147,059 Weighted average number of common shares outstanding - Diluted 102,576,132 There were no outstanding dilutive securities during the year ended June 30, 2018. There were no adjustments to the numerator during the year ended June 30, 2019.
Recent Accounting Pronouncements	Recent Accounting Pronouncements In August 2018, the FASB issued guidance to improve the effectiveness of fair value measurement disclosures by removing or modifying certain disclosure requirements and adding other requirements. The guidance is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019, with early adoption permitted. Certain amendments should be applied prospectively, while all other amendments should be applied retrospectively to all periods presented. The Company is currently evaluating the impact of the new guidance. In February 2018, the FASB issued guidance that permits the Company to reclassify disproportionate tax effects in accumulated other comprehensive income caused by the Tax Cuts and Jobs Act of 2017 to retained earnings. The guidance is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018, with early adoption permitted. The adoption of this standard is not expected to have a material impact on the Company’s consolidated financial statements. In July 2017, the FASB issued ASU 2017-11 which simplifies the accounting for certain financial instruments with down round features. The new standard will reduce income statement volatility for companies that issue warrants and convertible instruments containing such features. The guidance is effective for fiscal years beginning after December 15, 2018 with early adoption permitted. The adoption of this standard is not expected to have a material impact on the Company’s consolidated financial statements. In June 2016, the FASB issued a new credit loss standard that replaces the incurred loss impairment methodology in current GAAP. The new impairment model requires immediate recognition of estimated credit losses expected to occur for most financial assets and certain other instruments. It is effective for annual reporting periods beginning after December 15, 2019 and interim periods within those annual periods, with early adoption permitted. Entities will apply the standard’s provisions as a cumulative-effect adjustment to retained earnings as of the beginning of the first effective reporting period. The Company is currently evaluating the impact of the new guidance. In February 2016, the FASB issued new lease accounting guidance in ASU No. 2016-02, “ Leases The Company has implemented all new accounting pronouncements that are in effect and that may impact its financial statements and does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations.

2. Summary of Significant Acc_3

2. Summary of Significant Accounting Policies (Tables)	12 Months Ended
	Jun. 30, 2019
Accounting Policies [Abstract]
Weighted average shares outstanding	Year Ended June 30, 2019 Weighted average number of common shares outstanding - Basic 47,429,073 Potentially dilutive common stock equivalents (convertible note payable - related party) 55,147,059 Weighted average number of common shares outstanding - Diluted 102,576,132

8. Income Taxes (Tables)

8. Income Taxes (Tables)	12 Months Ended
	Jun. 30, 2019
Income Tax Disclosure [Abstract]
Reconciliation of Income Taxes	2019 2018 Current: Federal $ – $ – State – – Foreign – – – – Deferred: Federal (165,038 ) (6,716 ) State (45,852 ) (1,866 ) (210,890 ) (8,582 ) Valuation allowance 210,890 8,582 Total provision for income taxes $ – $ –
Schedule of deferred taxes	2019 2018 Net Operating Loss Carryforwards $ 219,472 $ 8,582 Gross Deferred Tax Assets 219,472 8,582 Valuation Allowance (219,472 ) (8,582 ) Net Deferred Tax Assets $ – $ –

9. Commitments and Contingenc_2

9. Commitments and Contingencies (Tables)	12 Months Ended
	Jun. 30, 2019
Commitments and Contingencies Disclosure [Abstract]
Minimum lease payments	Fiscal year ended $ June 30, 2020 12,804 June 30, 2021 17,457 June 30, 2022 17,980 June 30, 2023 18,112 Total minimum lease payments 66,353

1. Organization and Nature of_2

1. Organization and Nature of Operations (Details) - shares	12 Months Ended
	Jun. 30, 2019	Jun. 30, 2018
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Weighted average shares outstanding - basic	47,429,073	47,281,128
Potentially dilutive common stock equivalents	55,147,059
Weighted average common shares outstanding - diluted	102,576,132	47,281,128

1. Organization and Nature of_3

1. Organization and Nature of Operations (Details Narrative) - USD ($)	Jun. 30, 2019	Jun. 30, 2018
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Working capital	$ (13,641,143)
Accumulated deficit	$ (104,963,228)	$ (105,329,078)

3. Accrued Payroll Taxes (Detai

3. Accrued Payroll Taxes (Details Narrative) - USD ($)	12 Months Ended
	Jun. 30, 2019	Jun. 30, 2018
Payables and Accruals [Abstract]
Accrued payroll taxes, penalties and interest	$ 10,980,278	$ 12,392,022
Accrued interest rate	7.33% compounded daily
Penalties and interest expense	$ 852,595	945,238
Gain on expiration of accrued tax liability	$ 2,264,340	$ 0

4. Notes Payable - Related Pa_2

4. Notes Payable - Related Parties (Details Narrative) - USD ($)	Jun. 30, 2019	Jun. 30, 2018
Accounts payable and accrued liabilities – related parties	$ 417,133	$ 37,469
Note Payable Related Party A [Member]
Debt face amount	$ 38,615
Debt stated interest rate	3.00%
Note payable - related party balance	$ 39,195
Note Payable Related Party B [Member]
Debt face amount	$ 37,469
Debt stated interest rate	3.00%
Accounts payable and accrued liabilities – related parties	$ 37,469
Note Payable Related Party C [Member]
Debt stated interest rate	3.00%
Accounts payable and accrued liabilities – related parties	$ 2,250
Note Payable - Related Party D [Member]
Debt stated interest rate	3.00%
Accounts payable and accrued liabilities – related parties	$ 1,630
Note Payable - Related Party E [Member]
Debt face amount	$ 262,197
Debt stated interest rate	3.00%
Note payable - related party balance	$ 262,197

5. Convertible Note Payable -_2

5. Convertible Note Payable - Related Parties (Details Narrative) - USD ($)	12 Months Ended
	Jun. 30, 2019	Jun. 30, 2018
Convertible note payable – related party	$ 1,875,000	$ 0
Chief Executive Officer [Member]
Convertible note payable – related party	$ 1,875,000	1,615,000
Debt stated interest rate	3.00%
Conversion price	$ 0.034
Consulting fees	$ 260,000	$ 60,000

6. Common Shares (Details Narra

6. Common Shares (Details Narrative)	12 Months Ended
	Jun. 30, 2019shares
Chief Executive Officer [Member]
Stock issued to related party - reimburse expenses, shares	1,000,000

7. Related Party Transactions (

7. Related Party Transactions (Details Narrative) - USD ($)	Jun. 30, 2019	Jun. 30, 2018
Accounts payable and accrued liabilities – related parties	$ 417,133	$ 37,469
Management Fees [Member]
Accounts payable and accrued liabilities – related parties	$ 27,000

8. Income Taxes (Details - Inco

8. Income Taxes (Details - Income tax reconciliation) - USD ($)	12 Months Ended
	Jun. 30, 2019	Jun. 30, 2018
Income Tax Disclosure [Abstract]
Current federal tax expense	$ 0	$ 0
Current state tax expense	0	0
Current foreign tax expense	0	0
Total current tax expense	0	0
Federal deferred tax expense		(6,716)
State deferred tax expense	(45,852)	(1,866)
Total deferred tax expense	(210,890)	(8,582)
Valuation allowance	210,890	8,582
Total provision for income taxes	$ 0	$ 0

8. Income Taxes (Details - Defe

8. Income Taxes (Details - Deferred taxes) - USD ($)	Jun. 30, 2019	Jun. 30, 2018
Income Tax Disclosure [Abstract]
Net operating loss carryforwards	$ 219,472	$ 8,582
Gross deferred tax assets	219,472	8,582
Valuation allowance	(219,472)	(8,582)
Net deferred tax assets	$ 0	$ 0

8. Income Taxes (Details Narrat

8. Income Taxes (Details Narrative)	12 Months Ended
	Jun. 30, 2019USD ($)
Income Tax Disclosure [Abstract]
NOL carryforward	$ 818,000
NOL carryforward expiration date	Dec. 31, 2038

9. Commitments and Contingenc_3

9. Commitments and Contingencies (Details Narrative)	Jun. 30, 2019USD ($)
Commitments and Contingencies Disclosure [Abstract]
2020	$ 12,804
2021	17,457
2022	17,980
2023	18,112
Total miminum lease payments	$ 66,353