Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Dec. 31, 2018 | Feb. 15, 2019 | |
Document And Entity Information | ||
Entity Registrant Name | WATERSIDE CAPITAL CORP | |
Entity Central Index Key | 924,095 | |
Document Type | 10-Q | |
Document Period End Date | Dec. 31, 2018 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --06-30 | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business Flag | false | |
Entity Emerging Growth Company | false | |
Entity Ex-Transition Period | false | |
Entity Common Stock, Shares Outstanding | 1,915,548 | |
Trading Symbol | WSCC | |
Document Fiscal Period Focus | Q2 | |
Document Fiscal Year Focus | 2,019 |
Balance Sheets
Balance Sheets - USD ($) | Dec. 31, 2018 | Jun. 30, 2018 |
ASSETS | ||
Cash | $ 10,744 | $ 4,624 |
TOTAL ASSETS | 10,744 | 4,624 |
Current Liabilities | ||
Accounts Payable | 2,845 | 6,595 |
Convertible Note Payable - Roran, net of debt discount | 113,821 | 63,055 |
Accrued Interest Payable | 175,405 | 163,261 |
Judgment Payable | 10,427,300 | 10,427,300 |
Total Current Liabilities | 10,719,371 | 10,660,211 |
Total Liabilities | 10,719,371 | 10,660,211 |
Equity | ||
Common Stock, par value $1.00, 10,000,000 shares authorized, 1,915,548 shares issued and outstanding | 1,915,548 | 1,915,548 |
Additional Paid-In Capital | 15,566,480 | 15,539,813 |
Accumulated Deficit | (28,190,625) | (28,110,948) |
Total Equity | (10,708,597) | (10,655,587) |
TOTAL LIABILITIES & EQUITY | $ 10,744 | $ 4,624 |
Balance Sheets (Parenthetical)
Balance Sheets (Parenthetical) - $ / shares | Dec. 31, 2018 | Jun. 30, 2018 |
Statement of Financial Position [Abstract] | ||
Common stock, par value | $ 1 | $ 1 |
Common stock, shares authorized | 10,000,000 | 10,000,000 |
Common stock, shares issued | 1,915,548 | 1,915,548 |
Common stock, shares outstanding | 1,915,548 | 1,915,548 |
Statements of Operations (Unaud
Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income | ||||
Interest - Other | ||||
Total Income | ||||
Expense | ||||
Administrative Expenses | 21,876 | 18,990 | 30,100 | 43,751 |
Interest expense | 28,412 | 4,047 | 49,577 | 4,648 |
Total Expense | 50,288 | 23,037 | 79,677 | 48,399 |
Net Loss | $ 50,288 | $ 23,037 | $ 79,677 | $ 48,399 |
Weighted Average Number of Common Shares Outstanding- Basic and Diluted | 1,915,548 | 1,915,548 | 1,915,548 | 1,915,548 |
Net Loss Per Share- Basic and Diluted | $ (0.03) | $ (0.01) | $ (0.04) | $ (0.03) |
Statements of Cash Flows (Unaud
Statements of Cash Flows (Unaudited) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | |
OPERATING ACTIVITIES | ||||
Net Loss | $ (50,288) | $ (23,037) | $ (79,677) | $ (48,399) |
Adjustments to reconcile Net Loss to net cash used in operations to net cash provided by operations: | ||||
Amortization of interest | 37,433 | 3,194 | ||
Changes in assets and liabilities | ||||
Accounts Payable | (3,750) | 2,478 | ||
Accrued Interest Payable | 12,144 | 1,454 | ||
Net cash used by Operating Activities | (33,850) | (41,273) | ||
FINANCING ACTIVITIES | ||||
Proceeds from note payable from Roran Capital | 40,000 | 49,338 | ||
Net cash provided by Financing Activities | 40,000 | 49,338 | ||
Net cash increase for period | 6,150 | 8,065 | ||
Cash at beginning of period | 4,624 | |||
Cash at end of period | $ 10,774 | $ 8,065 | 10,774 | 8,065 |
Supplemental Non-Cash Investing and Financing Activities | ||||
Intrinsic value of embedded beneficial conversion feature on convertible note payable | $ 26,667 | $ 26,799 |
Organization and Operations
Organization and Operations | 6 Months Ended |
Dec. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Operations | NOTE 1 – ORGANIZATION AND OPERATIONS Waterside Capital Corporation (the “Company”) was incorporated in the Commonwealth of Virginia on July 13, 1993 and was a closed-end investment company licensed by the Small Business Administration (the “SBA”) as a Small Business Investment Corporation (“SBIC”). The Company previously made equity investments in, and provided loans to, small businesses to finance their growth, expansion, and development. Under applicable SBA regulations, the Company was restricted to investing only in qualified small businesses as contemplated by the Small Business Investment Act of 1958. As a registered investment company under the Investment Company Act of 1940, as amended (the “Investment Company Act”), the Company’s investment objective was to provide its shareholders with a high level of income, with capital appreciation as a secondary objective. The Company made its first investment in a small business in October 1996. On May 28, 2014, with the Company’s consent, the court having jurisdiction over the action filed by the SBA (the “ Court Order The Company effectively stopped conducting an active business upon the appointment of the SBA as receiver and the commencement of the court ordered receivership (the “ Receivership The Company has no operating assets of any value, and the Company no longer has the SBIC license from the SBA. The Company is clearly no longer operating as a registered investment company under the Investment Company Act. The Company will now seek to either (i) enter into a new business; or, (ii) merge with, or otherwise acquire, an active business which would benefit from operating as a public entity, and has undertaken a search to identify the best possible candidate(s) in order to provide value to the shareholders of the Company. The Company has filed with the SEC an Application pursuant to Section 8(f) of the Investment Company Act of 1940 for an order declaring that the Company has ceased to be a registered investment company. In response to that filing, the SEC issued to the Company comments in a letter dated May 16, 2018. The Company responded to those comments with the filing of an Amended Application on June 4, 2018. On October 30, 2018, in response to verbal comments from the SEC, the Company filed a Second Amended Application. As of the date of this Quarterly Statement, the Company has not received any response from the SEC in regard to the Second Amended Application. Going Concern The accompanying financial statements of our Company have been prepared in accordance with accounting principles generally accepted in the United States. The Company effectively ceased operations and it continues to have net losses through the date of these financial statements. Our financial statements have been presented on the basis that our business is a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. We are subject to the risks and uncertainties associated with a business with no operating business or assets and no revenue, as well as limitations on our operating capital resources. We have incurred operating losses and negative operating cash flows since the Receivership, and we expect to continue to incur operating losses and negative operating cash flows at least through the near future. Roran, which is a related party to the Company, has agreed to advance our Company a limited amount of funding in order to partially meet our most critical cash requirements. For further discussion of the advances made by Roran, see Notes 3 and 5. |
Significant Accounting Policies
Significant Accounting Policies | 6 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies | NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES Significant Accounting Policies There have been no material changes in the Company’s significant accounting policies to those previously disclosed in the Company’s June 30, 2018 Financial statements included in its 2018 Annual Report on Form 10-K. Fiscal Year-End The Company elected June 30 th Use of Estimates and Assumptions and Critical Accounting Estimates and Assumptions The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America 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 dates of the financial statements and the reported amounts of revenues and expenses during the reporting periods. These significant accounting estimates or assumptions bear the risk of change due to the fact that there are uncertainties attached to these estimates or assumptions, and certain estimates or assumptions are difficult to measure or value. Management bases its estimates on historical experience and on various assumptions that are believed to be reasonable in relation to the financial statements taken as a whole under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Management regularly evaluates the key factors and assumptions used to develop the estimates utilizing currently available information, changes in facts and circumstances, historical experience and reasonable assumptions. After such evaluations, if deemed appropriate, those estimates are adjusted accordingly. Actual results could differ from those estimates. Convertible Financial Instruments The Company bifurcates conversion options from their host instruments and accounts for them as free standing derivative financial instruments if certain criteria are met. The criteria include circumstances in which (a) the economic characteristics and risks of the embedded derivative instrument are not clearly and closely related to the economic characteristics and risks of the host contract, (b) the hybrid instrument that embodies both the embedded derivative instrument and the host contract is not re-measured at fair value under otherwise applicable generally accepted accounting principles with changes in fair value reported in earnings as they occur and (c) a separate instrument with the same terms as the embedded derivative instrument would be considered a derivative instrument. An exception to this rule is when the host instrument is deemed to be conventional, as that term is described under applicable GAAP. When the Company has determined that the embedded conversion options should not be bifurcated from their host instruments, discounts are recorded for the intrinsic value of conversion options embedded in the instruments based upon the differences between the fair value of the underlying common stock at the commitment date of the transaction and the effective conversion price embedded in the instrument. Beneficial conversion feature Related Parties The Company follows subtopic 850-10 of the FASB Accounting Standards Codification (“ASC”) for the identification of related parties and disclosure of related party transactions. Pursuant to ASC 850-10-20 related parties include (a) affiliates (“Affiliate” means, with respect to any specified Person, any other Person that, directly or indirectly through one or more intermediaries, controls, is controlled by or is under common control with such Person, as such terms are used in and construed under Rule 405 under the Securities Act) of the Company; (b) entities for which investments in their equity securities would be required, absent the election of the fair value option under the Fair Value Option Subsection of ASC 825–10–15, to be accounted for by the equity method by the investing entity; (c) trusts for the benefit of employees, such as pension and profit-sharing trusts that are managed by or under the trusteeship of management; (d) principal owners of the Company; e) management of the Company; (f) other parties with which the Company may deal if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests; and (g) other parties that can significantly influence the management or operating policies of the transacting parties or that have an ownership interest in one of the transacting parties and can significantly influence the other to an extent that one or more of the transacting parties might be prevented from fully pursuing its own separate interests. The financial statements shall include disclosures of material related party transactions, other than compensation arrangements, expense allowances, and other similar items in the ordinary course of business. However, disclosure of transactions that are eliminated in the preparation of consolidated or combined financial statements is not required in those statements. The disclosures shall include: (a) the nature of the relationship(s) involved; (b) a description of the transactions, including transactions to which no amounts or nominal amounts were ascribed, for each of the periods for which income statements are presented, and such other information deemed necessary to an understanding of the effects of the transactions on the financial statements; (c) the dollar amounts of transactions for each of the periods for which income statements are presented and the effects of any change in the method of establishing the terms from that used in the preceding period; and, (d) amounts due from or to related parties as of the date of each balance sheet presented and, if not otherwise apparent, the terms and manner of settlement. Commitments and Contingencies The Company follows ASC 450-20 to report accounting for contingencies. Certain conditions may exist as of the date the financial statements are issued, which may result in a loss to the Company, but which will only be resolved when one or more future events occur or fail to occur. Management assesses such contingent liabilities, and such assessment inherently involves an exercise of judgment. In assessing loss contingencies related to legal proceedings that are pending against the Company or un-asserted claims that may result in such proceedings, management evaluates the perceived merits of any legal proceedings or un-asserted claims as well as the perceived merits of the amount of relief sought or expected to be sought therein. If the assessment of a contingency indicates that it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in the Company’s financial statements. If the assessment indicates that a potentially material loss contingency is not probable but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, and an estimate of the range of possible losses, if determinable and material, would be disclosed. Loss contingencies considered remote are generally not disclosed unless they involve guarantees, in which case the guarantees would be disclosed. Deferred Tax Assets and Income Taxes Provision The Company adopted the provisions of ASC 740-10-25-13. ASC 740-10-25-13 which addresses the determination of whether tax benefits claimed or expected to be claimed on a tax return should be recorded in the financial statements. Under ASC 740-10-25-13, the Company may recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the financial statements from such a position should be measured based on the largest benefit that has a greater than fifty percent (50%) likelihood of being realized upon ultimate settlement. ASC 740-10-25-13 also provides guidance on de-recognition, classification, interest and penalties on income taxes, accounting in interim periods and requires increased disclosures. The Company had no material adjustments to its liabilities for unrecognized income tax benefits according to the provisions of ASC 740-10-25-13. The estimated future tax effects of temporary differences between the tax basis of assets and liabilities are reported in the accompanying balance sheets, as well as tax credit carry-backs and carry-forwards. The Company periodically reviews the recoverability of deferred tax assets recorded on its balance sheets and provides valuation allowances as management deems necessary. Management makes judgments as to the interpretation of the tax laws that might be challenged upon an audit and cause changes to previous estimates of tax liability. In addition, the Company operates within multiple taxing jurisdictions and is subject to audit in these jurisdictions. In management’s opinion, adequate provisions for income taxes have been made for all years. If actual taxable income by tax jurisdiction varies from estimates, additional allowances or reversals of reserves may be necessary. Tax years that remain subject to examination by major tax jurisdictions are generally the prior three (3) years for federal purposes, and the prior four (4) years for state purposes; however, as a result of the Company’s operating losses, all tax years remain subject to examination by tax authorities. Net Loss Per Common Share The Company computes net income or loss per share in accordance with ASC 260 Earnings Per Share. Under the provisions of the Earnings per Share Topic ASC, basic net loss per share is computed by dividing the net loss available to common stockholders for the period by the weighted average number of shares of common stock outstanding during the period. The calculation of diluted net loss per share gives effect to common stock equivalents; however, potential common shares are excluded if their effect is anti-dilutive. Recently Issued Accounting Pronouncements From time to time, new accounting pronouncements are issued by the FASB or other standard setting bodies that are adopted by the Company as of the specified effective date. Unless otherwise discussed, we believe that the impact of recently issued standards that are not yet effective will not have a material impact on our financial position or results of operations upon adoption. |
Notes Payable
Notes Payable | 6 Months Ended |
Dec. 31, 2018 | |
Debt Disclosure [Abstract] | |
Notes Payable | NOTE 3 – NOTES PAYABLE On March 30, 2010, the SBA notified the Company that its account had been transferred to liquidation status and that the then outstanding debentures of $16.1 million plus accrued interest (the “Debentures”) were due and payable within fifteen days of the date of the letter. The Company did not possess adequate liquid assets to make this payment. The Company negotiated terms of a settlement agreement with the SBA effective September 1, 2010, which allowed the Company’s management to liquidate the portfolio so long as there are no events of default. The Debentures were repurchased by the SBA in September 2010, represented by a Note Agreement between the SBA and the Company. The Note Agreement had a maturity of March 31, 2013. In the event of a default, the SBA had the ability to seek receivership. On May 24, 2012 the SBA delivered to the Company a notice of an event of default for failure to meet the principal repayment schedule under the Note Agreement (the “ Notice On November 20, 2013 the SBA filed a complaint in the United States District Court for the Eastern District of Virginia seeking, among other things, receivership for the Company and a judgment in the amount outstanding under the Note Agreement plus continuing interest. The complaint alleged that as of October 31, 2013 there remained an outstanding balance of $11,762,634 under the Note Agreement, including interest, which continued to accrue at the rate of $2,021 per day. The SBA, in filing the complaint, requested that the court take exclusive jurisdiction of the Company and all of its assets wherever located and appoint the SBA as permanent receiver of the Company for the purpose of liquidating all of the Company’s assets and satisfying the claims of its creditors in the order of priority as determined by the court. The Company initially took steps to contest the legal action initiated by the SBA and to oppose the receivership action. On April 29, 2014 the Board of Directors of the Company, as then constituted (the “ Board On May 28, 2014, with the Company’s consent, the court having jurisdiction over the action filed by the SBA (the “ Court Order On June 28, 2017, the Receivership was terminated and a final order entered by the Court provided Roran with control of the Company. As of June 30, 2018, the Company’s outstanding judgment payable totaled $10,427,300, and interest payable totaled $156,933. The Company’s outstanding judgment payable owed to the SBA was purchased by Roran from the SBA in July 2017. As such, all amounts due under the outstanding judgment payable are now owed to Roran rather than the SBA. Upon purchase, the Company began to accrue interest that was due under the original terms of the judgment payable. The statutory interest rate is 0.094%. The Company has accrued $161,645 in interest on the judgment payable as of December 31, 2018. On September 19, 2017, the Company entered into a Convertible Loan Agreement with Roran (the “Loan Agreement”). Pursuant to the Loan Agreement, Roran agreed to loan to the Company an amount not to exceed a total of $150,000 in principal over 18-months. Each advance under the Loan Agreement will be documented under a Convertible Promissory Note issued by the Company in favor of Roran (the “Note”). The Note bears interest at the rate of 12% per annum and is due in 18-months. Roran has the right to convert all or any portion of the Note into shares of the Company’s common stock at a conversion price equal to 60% of the share price. As a result of the advances made pursuant to the Loan Agreement, the Company has incurred total obligations of $139,338 as of December 31, 2018. The Company recorded a BCF due the conversion option of $86,800, and the unamortized balance at December 31, 2018 is $25,517. The amount is netted against the note payable balance as a debt discount with the corresponding entry to additional paid-in capital. The debt discount has been amortized as interest expense through the maturity date in March 2019. The Company is currently negotiating with Roran to extend the due date and provide additional funding. |
Investments and Notes Receivabl
Investments and Notes Receivable | 6 Months Ended |
Dec. 31, 2018 | |
Investments And Notes Receivable | |
Investments and Notes Receivable | NOTE 4 - INVESTMENTS AND NOTES RECEIVABLE The Company’s legacy assets primarily consisted of prior investments that were composed of equity and debt securities. During the Receivership, the investments were either in default or distressed in nature. The Receiver liquidated the assets through negotiations and the investments were written down to their estimated net realizable value through recognizing other-than-temporary impairment losses. During the year ended June 30, 2016, the Receiver liquidated the remaining investment assets and recognized a loss of $100,425. As part of a settlement on an investment, during the year ended June 30, 2016, the Receiver exchanged part of an investment for two $75,000 notes receivable with consecutive 1 year terms. The first note receivable was repaid during the period ended September 30, 2016. The other $75,000 note receivable was transferred to the SBA to settle part of the accrued interest outstanding on the SBA judgment later in the 2017 fiscal year. |
Related Party Transactions
Related Party Transactions | 6 Months Ended |
Dec. 31, 2018 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | NOTE 5 - RELATED PARTY TRANSACTIONS The following individuals and entities have been identified as related parties based on their family affiliation with our Chairman of the Board: Yitzhak Zelmanovitch Roran Capital LLC The following amounts were owed to related parties, affiliated with the CEO and Chairman of the Board, at the dates indicated: December 31, 2018 Judgment Payable (acquired by Roran from SBA) $ 10,427,300 Interest on Judgment Payable $ 161,645 Convertible Note Payable (See Note 4) $ 139,338 Interest on Convertible Note Payable $ 13,759 $ 10,742,042 |
Subsequent Events
Subsequent Events | 6 Months Ended |
Dec. 31, 2018 | |
Subsequent Events [Abstract] | |
Subsequent Events | NOTE 6 – SUBSEQUENT EVENTS The Company has evaluated all events that occurred after the balance sheet date through the date of the filing of this Quarterly Report on Form 10-Q to determine if they must be reported, and there are no subsequent events to be reported. |
Significant Accounting Polici_2
Significant Accounting Policies (Policies) | 6 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies | Significant Accounting Policies There have been no material changes in the Company’s significant accounting policies to those previously disclosed in the Company’s June 30, 2018 Financial statements included in its 2018 Annual Report on Form 10-K. |
Fiscal Year-End | Fiscal Year-End The Company elected June 30 th |
Use of Estimates and Assumptions and Critical Accounting Estimates and Assumptions | Use of Estimates and Assumptions and Critical Accounting Estimates and Assumptions The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America 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 dates of the financial statements and the reported amounts of revenues and expenses during the reporting periods. These significant accounting estimates or assumptions bear the risk of change due to the fact that there are uncertainties attached to these estimates or assumptions, and certain estimates or assumptions are difficult to measure or value. Management bases its estimates on historical experience and on various assumptions that are believed to be reasonable in relation to the financial statements taken as a whole under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Management regularly evaluates the key factors and assumptions used to develop the estimates utilizing currently available information, changes in facts and circumstances, historical experience and reasonable assumptions. After such evaluations, if deemed appropriate, those estimates are adjusted accordingly. Actual results could differ from those estimates. |
Convertible Financial Instruments | Convertible Financial Instruments The Company bifurcates conversion options from their host instruments and accounts for them as free standing derivative financial instruments if certain criteria are met. The criteria include circumstances in which (a) the economic characteristics and risks of the embedded derivative instrument are not clearly and closely related to the economic characteristics and risks of the host contract, (b) the hybrid instrument that embodies both the embedded derivative instrument and the host contract is not re-measured at fair value under otherwise applicable generally accepted accounting principles with changes in fair value reported in earnings as they occur and (c) a separate instrument with the same terms as the embedded derivative instrument would be considered a derivative instrument. An exception to this rule is when the host instrument is deemed to be conventional, as that term is described under applicable GAAP. When the Company has determined that the embedded conversion options should not be bifurcated from their host instruments, discounts are recorded for the intrinsic value of conversion options embedded in the instruments based upon the differences between the fair value of the underlying common stock at the commitment date of the transaction and the effective conversion price embedded in the instrument. Beneficial conversion feature |
Related Parties | Related Parties The Company follows subtopic 850-10 of the FASB Accounting Standards Codification (“ASC”) for the identification of related parties and disclosure of related party transactions. Pursuant to ASC 850-10-20 related parties include (a) affiliates (“Affiliate” means, with respect to any specified Person, any other Person that, directly or indirectly through one or more intermediaries, controls, is controlled by or is under common control with such Person, as such terms are used in and construed under Rule 405 under the Securities Act) of the Company; (b) entities for which investments in their equity securities would be required, absent the election of the fair value option under the Fair Value Option Subsection of ASC 825–10–15, to be accounted for by the equity method by the investing entity; (c) trusts for the benefit of employees, such as pension and profit-sharing trusts that are managed by or under the trusteeship of management; (d) principal owners of the Company; e) management of the Company; (f) other parties with which the Company may deal if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests; and (g) other parties that can significantly influence the management or operating policies of the transacting parties or that have an ownership interest in one of the transacting parties and can significantly influence the other to an extent that one or more of the transacting parties might be prevented from fully pursuing its own separate interests. The financial statements shall include disclosures of material related party transactions, other than compensation arrangements, expense allowances, and other similar items in the ordinary course of business. However, disclosure of transactions that are eliminated in the preparation of consolidated or combined financial statements is not required in those statements. The disclosures shall include: (a) the nature of the relationship(s) involved; (b) a description of the transactions, including transactions to which no amounts or nominal amounts were ascribed, for each of the periods for which income statements are presented, and such other information deemed necessary to an understanding of the effects of the transactions on the financial statements; (c) the dollar amounts of transactions for each of the periods for which income statements are presented and the effects of any change in the method of establishing the terms from that used in the preceding period; and, (d) amounts due from or to related parties as of the date of each balance sheet presented and, if not otherwise apparent, the terms and manner of settlement. |
Commitments and Contingencies | Commitments and Contingencies The Company follows ASC 450-20 to report accounting for contingencies. Certain conditions may exist as of the date the financial statements are issued, which may result in a loss to the Company, but which will only be resolved when one or more future events occur or fail to occur. Management assesses such contingent liabilities, and such assessment inherently involves an exercise of judgment. In assessing loss contingencies related to legal proceedings that are pending against the Company or un-asserted claims that may result in such proceedings, management evaluates the perceived merits of any legal proceedings or un-asserted claims as well as the perceived merits of the amount of relief sought or expected to be sought therein. If the assessment of a contingency indicates that it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in the Company’s financial statements. If the assessment indicates that a potentially material loss contingency is not probable but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, and an estimate of the range of possible losses, if determinable and material, would be disclosed. Loss contingencies considered remote are generally not disclosed unless they involve guarantees, in which case the guarantees would be disclosed. |
Deferred Tax Assets and Income Taxes Provision | Deferred Tax Assets and Income Taxes Provision The Company adopted the provisions of ASC 740-10-25-13. ASC 740-10-25-13 which addresses the determination of whether tax benefits claimed or expected to be claimed on a tax return should be recorded in the financial statements. Under ASC 740-10-25-13, the Company may recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the financial statements from such a position should be measured based on the largest benefit that has a greater than fifty percent (50%) likelihood of being realized upon ultimate settlement. ASC 740-10-25-13 also provides guidance on de-recognition, classification, interest and penalties on income taxes, accounting in interim periods and requires increased disclosures. The Company had no material adjustments to its liabilities for unrecognized income tax benefits according to the provisions of ASC 740-10-25-13. The estimated future tax effects of temporary differences between the tax basis of assets and liabilities are reported in the accompanying balance sheets, as well as tax credit carry-backs and carry-forwards. The Company periodically reviews the recoverability of deferred tax assets recorded on its balance sheets and provides valuation allowances as management deems necessary. Management makes judgments as to the interpretation of the tax laws that might be challenged upon an audit and cause changes to previous estimates of tax liability. In addition, the Company operates within multiple taxing jurisdictions and is subject to audit in these jurisdictions. In management’s opinion, adequate provisions for income taxes have been made for all years. If actual taxable income by tax jurisdiction varies from estimates, additional allowances or reversals of reserves may be necessary. Tax years that remain subject to examination by major tax jurisdictions are generally the prior three (3) years for federal purposes, and the prior four (4) years for state purposes; however, as a result of the Company’s operating losses, all tax years remain subject to examination by tax authorities. |
Net Loss Per Common Share | Net Loss Per Common Share The Company computes net income or loss per share in accordance with ASC 260 Earnings Per Share. Under the provisions of the Earnings per Share Topic ASC, basic net loss per share is computed by dividing the net loss available to common stockholders for the period by the weighted average number of shares of common stock outstanding during the period. The calculation of diluted net loss per share gives effect to common stock equivalents; however, potential common shares are excluded if their effect is anti-dilutive. |
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements From time to time, new accounting pronouncements are issued by the FASB or other standard setting bodies that are adopted by the Company as of the specified effective date. Unless otherwise discussed, we believe that the impact of recently issued standards that are not yet effective will not have a material impact on our financial position or results of operations upon adoption. |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 6 Months Ended |
Dec. 31, 2018 | |
Related Party Transactions [Abstract] | |
Schedule of Amounts Owned to Related Parties | The following amounts were owed to related parties, affiliated with the CEO and Chairman of the Board, at the dates indicated: December 31, 2018 Judgment Payable (acquired by Roran from SBA) $ 10,427,300 Interest on Judgment Payable $ 161,645 Convertible Note Payable (See Note 4) $ 139,338 Interest on Convertible Note Payable $ 13,759 $ 10,742,042 |
Organization and Operations (De
Organization and Operations (Details Narrative) - USD ($) | May 28, 2014 | Jun. 30, 2018 |
Amount paid in favor of judgement | $ 10,427,300 | |
Small Business Administration [Member] | ||
Amount paid in favor of judgement | $ 11,770,722 |
Significant Accounting Polici_3
Significant Accounting Policies (Details Narrative) | 6 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Income tax likelihood of being realized upon ultimate settlement | Fifty percent (50%) |
Income tax examination, description | Tax years that remain subject to examination by major tax jurisdictions are generally the prior three (3) years for federal purposes, and the prior four (4) years for state purposes; however, as a result of the Company's operating losses, all tax years remain subject to examination by tax authorities. |
Notes Payable (Details Narrativ
Notes Payable (Details Narrative) | Sep. 19, 2017USD ($) | May 28, 2014USD ($) | Dec. 31, 2018USD ($) | Jun. 30, 2018USD ($) | Oct. 31, 2013USD ($) | Mar. 30, 2010USD ($) |
Notes payable | $ 11,762,634 | $ 16,100,000 | ||||
Accrue interest | $ 156,933 | $ 2,021 | ||||
Amount paid in favor of judgement | $ 10,427,300 | |||||
Debt instrument face amount | $ 11,700,000 | |||||
Debt instrument accrued interest | 70,722 | |||||
Total obligations | $ 139,338 | |||||
Beneficial conversion feature discount | 86,800 | |||||
Unamortized balance | 25,517 | |||||
Roran [Member] | ||||||
Accrue interest | $ 161,645 | |||||
Statutory interest rate | 0.00094 | |||||
Convertible Loan Agreement [Member] | Roran [Member] | ||||||
Debt instrument face amount | $ 150,000 | |||||
Debt instruments interest rate percentage | 12.00% | |||||
Debt instruments term | 18 months | |||||
Debt instruments conversion price, percentage | 60.00% | |||||
Small Business Administration [Member] | ||||||
Amount paid in favor of judgement | $ 11,770,722 |
Investments and Notes Receiva_2
Investments and Notes Receivable (Details Narrative) - USD ($) | 6 Months Ended | 12 Months Ended |
Dec. 31, 2018 | Jun. 30, 2016 | |
Loss on investment | $ 100,425 | |
Two Notes Receivable [Member] | ||
Exchanged part of investment amount | $ 75,000 | |
Debt term | 1 year | |
Transfer of note receivable to SBA to settle part of accrued interest | $ 75,000 |
Related Party Transactions - Sc
Related Party Transactions - Schedule of Amounts Owned to Related Parties (Details) - USD ($) | Dec. 31, 2018 | Jun. 30, 2018 |
Judgment Payable (acquired by Roran from SBA) | $ 10,427,300 | $ 10,427,300 |
Interest on Judgment Payable | 175,405 | 163,261 |
Convertible Note Payable (See Note 4) | 113,821 | $ 63,055 |
CEO And Chairman Of Board [Member] | ||
Judgment Payable (acquired by Roran from SBA) | 10,427,300 | |
Interest on Judgment Payable | 161,645 | |
Convertible Note Payable (See Note 4) | 139,338 | |
Interest on Convertible Note Payable | 13,759 | |
Due to related parties | $ 10,742,042 |