Document and Entity Information
Document and Entity Information | 12 Months Ended |
Dec. 31, 2020shares | |
Statement Line Items [Line Items] | |
Entity Registrant Name | DIGATRADE FINANCIAL CORP. |
Entity Central Index Key | 0001369128 |
Document Type | 20-F |
Document Period End Date | Dec. 31, 2020 |
Amendment Flag | false |
Current Fiscal Year End Date | --12-31 |
Is Entity a Well-known Seasoned Issuer? | No |
Is Entity a Voluntary Filer? | No |
Is Entity's Reporting Status Current? | Yes |
Entity Filer Category | Non-accelerated Filer |
Entity Emerging Growth Company | false |
Entity Shell Company | false |
Entity Interactive Data Current | Yes |
Entity Incorporation, State or Country Code | A1 |
Document Annual Report | true |
Document Transition Report | false |
Document Shell Company Report | false |
Entity Common Stock, Shares Outstanding | 1,342,473,822 |
Document Fiscal Period Focus | FY |
Document Fiscal Year Focus | 2020 |
Class B Common stock | |
Statement Line Items [Line Items] | |
Entity Common Stock, Shares Outstanding | 2,100,000 |
Consolidated Statements of Fina
Consolidated Statements of Financial Position - CAD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
Current | ||
Cash | $ 476 | $ 113,156 |
GST recoverable | 12,044 | 13,655 |
Deferred loss on derivatives | 280,637 | 150,851 |
Total current assets | 293,157 | 277,662 |
Intangible assets | 0 | 26,761 |
Total assets | 293,157 | 304,423 |
Current | ||
Trade and other payables | 147,597 | 122,276 |
Loan payable | 0 | 26,565 |
Convertible promissory notes - liability portion | 91,721 | 50,593 |
Derivative liability | 1,610,858 | 370,194 |
Promissory notes | 11,904 | 165,698 |
Total liabilities | 1,862,080 | 735,326 |
SHAREHOLDERS' (DEFICIENCY) EQUITY | ||
Share capital | 8,876,281 | 7,460,158 |
Reserves | 60,000 | 60,000 |
Accumulated deficit | (10,505,204) | (7,793,332) |
Total equity (deficiency) attributable to shareholders | (1,568,923) | (273,174) |
Non-controlling interest | 0 | (157,729) |
Total liabilities and shareholders' equity (deficiency) | $ 293,157 | $ 304,423 |
Consolidated Statement of Chang
Consolidated Statement of Changes in Shareholders' Equity - CAD ($) | Number of Common Shares | Number of Class "B" Common Shares | Share Capital | Stock Option Reserve | Deficit | Total | Non-Controlling Interest |
Beginning balance, shares at Dec. 31, 2017 | 49,661,150 | 100,000 | |||||
Beginning balance amount at Dec. 31, 2017 | $ 4,106,207 | $ 0 | $ (5,176,116) | $ (1,069,909) | $ 0 | ||
Shares issued for services, shares | 600,000 | ||||||
Shares issued for services, amount | 7,373 | 7,373 | |||||
Share-based compensation | 0 | ||||||
Shares issued conversion convertible promissory notes, shares | 176,150,754 | ||||||
Shares issued conversion convertible promissory notes, amount | 1,966,571 | 1,934,419 | |||||
Net comprehensive loss | (522,963) | (522,963) | |||||
Ending balance, shares at Dec. 31, 2018 | 226,411,904 | 100,000 | |||||
Ending balance, amount at Dec. 31, 2018 | 6,080,151 | 0 | (5,699,079) | 381,072 | 0 | ||
Incorporation of controlled subsidiary | 342 | ||||||
Shares issued for cash, shares | 1,000,000 | ||||||
Shares issued for cash, amount | 100 | 100 | |||||
Shares issued for services, amount | 0 | ||||||
Share-based compensation | 60,000 | 60,000 | |||||
Shares issued conversion convertible promissory notes, shares | 356,153,022 | ||||||
Shares issued conversion convertible promissory notes, amount | 1,379,907 | 1,379,907 | |||||
Net comprehensive loss | (2,094,253) | (2,252,324) | (158,071) | ||||
Ending balance, shares at Dec. 31, 2019 | 582,564,926 | 1,100,000 | |||||
Ending balance, amount at Dec. 31, 2019 | 7,460,158 | 60,000 | (7,793,332) | (273,174) | (157,729) | ||
Shares issued for cash, shares | 1,000,000 | ||||||
Shares issued for cash, amount | 100 | 100 | |||||
Shares issued for services, amount | 0 | ||||||
Share-based compensation | 0 | ||||||
Shares issued conversion convertible promissory notes, shares | 759,908,896 | ||||||
Shares issued conversion convertible promissory notes, amount | 1,416,023 | 1,416,023 | |||||
Derecognition of non-controlling interest of subsidiary | 287,389 | ||||||
Adjustment on Derecognition of subsidiary | (2,272) | ||||||
Net comprehensive loss | (2,711,872) | (2,711,872) | (2,711,872) | ||||
Ending balance, shares at Dec. 31, 2020 | 1,342,473,822 | 2,100,000 | |||||
Ending balance, amount at Dec. 31, 2020 | $ 8,876,281 | $ 60,000 | $ (10,505,204) | $ (1,568,923) | $ 0 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Loss - CAD ($) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
EXPENSES | |||
Accounting, audit, and legal | $ 109,154 | $ 57,143 | $ 82,475 |
Bank charges | 540 | 532 | 0 |
Consulting | 145,396 | 376,100 | 294,502 |
Director's fees | 0 | 0 | 12,900 |
Exchange platform development costs | 0 | 0 | 102,683 |
Filing and transfer agent fees | 20,903 | 19,558 | 26,331 |
Financing finders' fees | 0 | 54,746 | 123,101 |
Travel | 0 | 13,944 | 0 |
Marketing | 4,039 | 10,708 | 0 |
Stock-based compensation | 0 | 60,000 | 0 |
Investor Relations | 0 | 20,096 | 0 |
Management fees | 133,939 | 244,120 | 241,950 |
Office | 273 | 12,409 | 12,282 |
Total expenses | 414,244 | 869,356 | 896,224 |
LOSS BEFORE OTHER ITEMS | (414,244) | (869,356) | (896,224) |
Accretion expenses | (137,880) | (146,624) | (7,039) |
Foreign exchange gain | 2,485 | 48,045 | 37,682 |
Gain on discontinuance of trading platform | 0 | 0 | 7,158 |
Interest expenses | (30,785) | (58,470) | (198,658) |
Gain on write-off of promissory note | 151,301 | 0 | 0 |
Change in fair value on derivative instruments | (1,995,930) | (1,067,076) | 534,118 |
NET LOSS FOR THE YEAR | (2,425,053) | (2,093,481) | (522,963) |
Loss for the period from Discontinued Operations | (127,637) | (158,843) | 0 |
Loss on Spin-out of subsidiary | (286,570) | 0 | 0 |
NET COMPREHENSIVE LOSS FOR THE YEAR | (2,711,872) | (2,252,324) | (522,963) |
TOTAL COMPREHENSIVE LOSS ATTRIBUTABLE TO: | |||
Shareholders of the Company | (2,711,872) | (2,094,253) | (522,963) |
Non-controlling interest | $ (127,388) | $ (158,071) | $ 0 |
Basic and diluted loss per share | $ (0.01) | $ (0.01) | $ (0.01) |
Weighted average number of shares outstanding | 1,082,137,350 | 318,328,932 | 94,081,822 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - CAD ($) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
CASH PROVIDED BY (USED FOR): OPERATING ACTIVITIES | |||
Net loss for the year | $ (2,425,053) | $ (2,093,481) | $ (522,963) |
Loss for the period from Discontinued Operations | 127,637 | 158,843 | 0 |
Non-Cash Items | |||
Shares issued for services | 0 | 0 | 7,373 |
Gain on discontinuance of trading platform | 0 | 0 | (7,158) |
Gain on write-off of promissory note | (151,301) | 0 | 0 |
Accretion expenses | 137,880 | 146,624 | 7,039 |
Promissory note issued for consulting services | 0 | 0 | 64,820 |
Change in valuation of derivative instruments | 1,995,930 | 1,067,076 | (534,118) |
Unrealized foreign exchange (gain) loss | (2,658) | (12,264) | (77,850) |
Accrued interest on promissory notes | 30,785 | 58,470 | 195,412 |
Amortization of prepaid expenses | 0 | 22,211 | 16,369 |
Legal fees adjustments to promissory notes | 0 | 0 | (17,669) |
Share-based compensation | 0 | 60,000 | 0 |
Cash flows provided by (used for) operating activities before changes in working capital | (414,417) | (751,364) | (868,745) |
Change in non-cash working capital accounts | 26,860 | (9,472) | 104,827 |
Cash used in Continuing Operations | (387,557) | (760,836) | (763,918) |
Net Cash from Discontinued Operations | 17,078 | 8 | 0 |
Cash flows provided by (used for) operating activities | (370,479) | (760,828) | (763,918) |
CASH PROVIDED BY (USED FOR): INVESTING ACTIVITIES | |||
Net Cash used in Investments in Discontinued Operations | (14,901) | (158,915) | 0 |
Cash flows provided by (used for) operating activities | (14,901) | (158,915) | 0 |
CASH PROVIDED BY (USED FOR): FINANCING ACTIVITIES | |||
Advances from minority interest | 0 | 196 | 0 |
Net proceeds on issuance of Class B stock | 100 | 100 | 0 |
Net proceeds on issuance of promissory notes | 403,600 | 572,389 | 795,047 |
Promissory notes repayment | 0 | (33,596) | (31,762) |
Cash flows provided by (used for) financing activities | 403,700 | 539,089 | 763,285 |
(DECREASE) INCREASE IN CASH | (112,680) | (380,654) | (633) |
Cash, beginning of the year | 113,156 | 493,810 | 494,443 |
Cash, end of the year | $ 476 | $ 113,156 | $ 493,810 |
NATURE AND CONTINUANCE OF OPERA
NATURE AND CONTINUANCE OF OPERATIONS | 12 Months Ended |
Dec. 31, 2020 | |
Nature And Continuance Of Operations | |
NATURE AND CONTINUANCE OF OPERATIONS | Digatrade Financial Corp. (the “Company”) is governed by the Business Corporations Act (British Columbia). The head office, principal address, and records office of the Company are located at 1500 West Georgia Street, Suite 1300, Vancouver, British Columbia, Canada, V6C 2Z6. The Company's common shares are listed on the NASDAQ Over-the-Counter Board (“OTCB”) exchange under the symbol "DIGAF". In March 2015, the Company entered into an agreement with Mega Ideas Holdings Limited, dba ANX (“ANX”), a company incorporated and existing under the laws of Hong Kong. ANX owns a proprietary trading platform and provides operational support specializing in blockchain development services and exchange and transaction services for crypto-currencies. Effective October 17, 2018 the Company closed the online retail trading platform and shared liquidity order book with ANX International owing to low transaction volumes. The Company will continue to offer OTC trading for institutional customers and accredited traders while continuing to seek new opportunities within the blockchain and the financial technology sector. In February 2019, the Company entered into a Definitive Agreement with Securter Inc. (“Securter”), a private Canadian corporation that is developing a proprietary, patent-pending credit card payment platform to significantly increase the security of online credit card payment processing (Note 5). These consolidated financial statements have been prepared in accordance with International Financial Reporting Standards on the basis that the Company is a going concern and will be able to meet its obligations and continue its operations for its next fiscal year. Several conditions as set out below cast uncertainties on the Company’s ability to continue as a going concern. The outbreak of the COVID-19 virus and the worldwide pandemic has impacted the Company’s plans and activities. The Company may face disruption to operations, supply chain delays, travel and trade restrictions, and impacts on economic activity in affected countries or regions can be expected and are difficult to quantify. Regional disease outbreaks and pandemics represent a serious threat to hiring and maintaining a skilled workforce and could be a major health-care challenge for the Company. There can be no assurance that the Company’s personnel will not be impacted by these regional disease outbreaks and pandemics and ultimately that the Company would see its workforce productivity reduced or incur increased medical costs and insurance premiums as a result of these health risks. In addition, the pandemic has created a dramatic slowdown in the global economy. The duration of the outbreak and the resulting travel restrictions, social distancing recommendations, government response actions, business disruptions and business closures may have an impact on the Company’s operations and access to capital. There can be no assurance that the Company will not be impacted by adverse consequences that may be brought about by the pandemic’s impact on global industrial and financial markets which may reduce prices in general, share prices and financial liquidity thereby severely limiting access to essential capital. The Company’s ability to continue as a going concern is dependent upon the financial support from its creditors, shareholders, and related parties, its ability to obtain financing for its development projects, and upon the attainment of future profitable operations. The Company has not yet achieved profitable operations and has accumulated losses of $10,505,204 since inception and working capital deficiency of $238,702 as at December 31, 2020. Accordingly, the Company will need to raise additional funds through future issuance of securities or debt financing. Although the Company has raised funds in the past, there can be no assurance the Company will be able to raise sufficient funds in the future, in which case the Company may be unable to meet its obligations as they come due in the normal course of business. It is not possible to predict whether financing efforts will be successful or if the Company will attain a profitable level of operations. |
SIGNIFICANT ACCOUNTING POLICIES
SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2020 | |
Significant Accounting Policies | |
SIGNIFICANT ACCOUNTING POLICIES | a) Basis of Presentation These consolidated financial statements have been prepared on a historical cost basis except for financial instruments classified as available-for-sale that have been measured at fair value. Cost is the fair value of the consideration given in exchange for net assets. b) Statement of Compliance These consolidated financial statements have been prepared in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”). These consolidated financial statements were approved and authorized for issue by the Board of Directors on April 09, 2021. c) Basis of Consolidation These consolidated financial statements include the accounts of the Company and its subsidiaries (collectively, the “Company”). Intercompany balances and transactions are eliminated in preparing the consolidated financial statements. The following companies have been consolidated within these consolidated financial statements: Entity Country of Incorporation Voting Control Functional Currency Digatrade Financial Corp. Canada Parent Company Canadian Dollar Digatrade Limited Canada 100% Canadian Dollar Digatrade (UK) Limited United Kingdom 100% Pounds Sterling Digatrade Limited USA 100% US Dollar d) Foreign Currency These consolidated financial statements are presented in Canadian dollars, which is also the functional currency of the parent company. Each subsidiary determines its own functional currency (Note 2(c)) and items included in the financial statements of each subsidiary are measured using that functional currency. i. Transactions and Balances in Foreign Currencies Foreign currency transactions are translated into the functional currency of the respective entity using the exchange rates prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the re-measurement of monetary items at year-end exchange rates are recognized in profit or loss. Non-monetary items measured at historical cost are translated using the exchange rate at the date of the transaction and are not retranslated. Non-monetary items measured at fair value are translated using the exchange rate at the date when fair value was determined. ii. Foreign Operations On consolidation, the assets and liabilities of foreign operations are translated into Canadian dollars at the exchange rate prevailing at the reporting date and their revenues and expenses are translated at exchange rates prevailing at the dates of the transactions. The exchange differences arising on the translation are recognized in other comprehensive income and accumulated in the currency translation reserve in equity. On disposal of a foreign operation, the component of other comprehensive income relating to that particular foreign operation is recognized in earnings and recognized as part of the gain or loss on disposal. e) Financing and Finder’s Fees Financing and finder’s fees relating to financial instruments with a term of one year or less are expensed in the period incurred. For financial instruments with a term of over one year, the fees are netted against the financial instruments and amortized over the term of the financial instruments. f) Share Capital The Company records proceeds from share issuances, net of commissions and issuance costs. Shares issued for other than cash consideration are valued at either: (i) the fair value of the asset acquired or the fair value of the liability extinguished at the measurement date under current market conditions, or (ii) the quoted price on the Over-the-Counter Bulletin Board in the United States based on the earliest of: the date the shares are issued, or the date the agreement to issue the shares is reached. g) Loss per Share Basic loss per share is calculated by dividing net loss by the weighted average number of common shares issued and outstanding during the reporting period. Diluted loss per share is the same as basic loss per share, as the issuance of shares on the exercise of stock options and share purchase warrants is anti-dilutive. h) Share-Based Payments The fair value method of accounting is used for share-based payment transactions. Under this method, the cost of stock options and other share-based payments is recorded based on the estimated fair value using the Black-Scholes option-pricing model at the grant date and charged to profit over the vesting period. The amount recognized as an expense is adjusted to reflect the number of equity instruments expected to vest. Upon the exercise of stock options and other share-based payments, consideration received on the exercise of these equity instruments is recorded as share capital and the related share-based payment reserve is transferred to share capital. The fair value of unexercised equity instruments are transferred from reserve to retained earnings upon expiry. i) Income Taxes Tax expense recognized in profit or loss comprises the sum of deferred tax and current tax not recognized in other comprehensive income or directly in equity. i. Current Income Tax Current income tax assets and liabilities comprise those claims from, or obligations to, fiscal authorities relating to the current or prior reporting periods that are unpaid at the reporting date. Current tax is payable on taxable profit, which differs from profit or loss in the consolidated financial statements. Calculation of current tax is based on tax rates and tax laws that have been enacted or substantively enacted by the end of the reporting period. ii. Deferred Income Tax Deferred income taxes are calculated using the liability method on temporary differences between the carrying amounts of assets and liabilities and their tax bases. Deferred tax assets and liabilities are calculated, without discounting, at tax rates that are expected to apply to their respective period of realization, provided they are enacted or substantively enacted by the end of the reporting period. Deferred tax liabilities are always provided for in full. Deferred tax assets are recognized to the extent that it is probable that they will be able to be utilized against future taxable income. Deferred tax assets and liabilities are offset only when the Company has a right and intention to offset current tax assets and liabilities from the same taxation authority. Changes in deferred tax assets or liabilities are recognized as a component of tax income or expense in profit or loss, except where they relate to items that are recognized in other comprehensive income or directly in equity, in which case the related deferred tax is also recognized in other comprehensive income or equity, respectively. j) Revenue Recognition Revenue is comprised of consulting fees and commissions earned on trades executed on the digital currency trading platform. Consulting fee income is recognized as the consulting services are provided. Commission is considered earned when a trade is completed by the Company’s customers. As the platform is not yet fully live, commissions and consulting fees earned have been accounted for as a recovery of development costs incurred. k) Financial Instruments The following is the Company’s accounting policy for financial instruments under IFRS 9: (i) Classification The Company classifies its financial instruments in the following categories: at fair value through profit and loss (“FVTPL”), at fair value through other comprehensive income (loss) (“FVTOCI”) or at amortized cost. The Company determines the classification of financial assets at initial recognition. The classification of debt instruments is driven by the Company’s business model for managing the financial assets and their contractual cash flow characteristics. Equity instruments that are held for trading are classified as FVTPL. For other equity instruments, on the day of acquisition the Company can make an irrevocable election (on an instrument-by-instrument basis) to designate them as at FVTOCI. Financial liabilities are measured at amortized cost, unless they are required to be measured at FVTPL (such as instruments held for trading or derivatives) or if the Company has opted to measure them at FVTPL. The following table shows the classification under IFRS 9: Financial assets/liabilities Classification Cash FVTPL Marketable Securities FVTPL Accounts payable Amortized cost (ii) Measurement Financial assets and liabilities at amortized cost Financial assets and liabilities at amortized cost are initially recognized at fair value plus or minus transaction costs, respectively, and subsequently carried at amortized cost less any impairment. Financial assets and liabilities at FVTPL Financial assets and liabilities carried at FVTPL are initially recorded at fair value and transaction costs are expensed in the Consolidated Statements of Comprehensive Income. Realized and unrealized gains and losses arising from changes in the fair value of the financial assets and liabilities held at FVTPL are included in the Consolidated Statements of Comprehensive Income in the period in which they arise. (iii) Impairment of financial assets The Company recognizes a loss allowance for expected credit losses on financial assets that are measured at amortized cost. At each reporting date, the Company measures the loss allowance for the financial asset at an amount equal to the lifetime expected credit losses if the credit risk on the financial asset has increased significantly since initial recognition. If at the reporting date, the financial asset has not increased significantly since initial recognition, the Company measures the loss allowance for the financial asset at an amount equal to twelve month expected credit losses. The Company shall recognize in the Consolidated Statements of Comprehensive Income, as an impairment gain or loss, the amount of expected credit losses (or reversal) that is required to adjust the loss allowance at the reporting date to the amount that is required to be recognized. l) Non-Controlling Interest Non-controlling interest in the Company’s less than wholly owned subsidiary is classified as a separate component of equity. On initial recognition, non-controlling interest is measured at the fair value of the non-controlling entity’s contribution into the related subsidiary. Subsequent to the original transaction date, adjustments are made to the carrying amount of non-controlling interest for the non-controlling interest’s share of changes to the subsidiary’s equity. m) Accounting Standards Effective January 1, 2020 Amendments to IFRS 7 and 9 and IAS 39 On September 26, 2019, IASB amended some of the existing IFRSs requirements for hedge accounting. The amendments are designed to support the provision of useful financial information by companies during the period of uncertainty arising from the phasing out of interest-rate benchmarks such as IBORs. The amendments modify some specific hedge accounting requirements to provide relief from potential effects of the uncertainty caused by the IBOR reform. In addition, the amendments require companies to provide additional information to investors about their hedging relationships which are directly affected by these uncertainties. These amendments were effective for annual periods beginning on or after January 1, 2020 and must be applied retrospectively. Early application is permitted. |
SIGNIFICANT ACCOUNTING JUDGMENT
SIGNIFICANT ACCOUNTING JUDGMENTS, ESTIMATES AND ASSUMPTIONS | 12 Months Ended |
Dec. 31, 2020 | |
Significant Accounting Judgments Estimates And Assumptions | |
SIGNIFICANT ACCOUNTING JUDGMENTS, ESTIMATES AND ASSUMPTIONS | In the application of the Company’s accounting policies which are described in Note 2, management is required to make judgments, estimates, and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates. The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the period in which the estimate is revised if the revision affects only that period, or in the period of the revision and future periods, if the revision affects both current and future periods. Significant judgments, estimates, and assumptions that have the most significant effect on the amounts recognized in the consolidated financial statements are described below. Deferred Tax Assets Deferred tax assets, including those arising from unutilized tax losses, require management to assess the likelihood that the Company will generate sufficient taxable earnings in future periods in order to utilize recognized deferred tax assets. Assumptions about the generation of future taxable profits depend on management’s estimates of future cash flows. In addition, future changes in tax laws could limit the ability of the Company to obtain tax deductions in future periods. To the extent that future cash flows and taxable income differ significantly from estimates, the ability of the Company to realize the net deferred tax assets recorded at the reporting date could be impacted. Share-based Compensation The fair value of share-based compensation is subject to the limitations of the Black-Scholes option pricing model that incorporates market data and involves uncertainty in estimates used by management in the assumptions. Because the Black-Scholes option pricing model requires the input of highly subjective assumptions, including the volatility of share prices, changes in subjective input assumptions can materially affect the fair value estimate. Impairment of Assets An impairment loss is recognized for the amount by which the asset’s or cash generating unit’s carrying amount exceeds its recoverable amount. To determine the recoverable amount, management estimates expected future cash flows from each asset or cash-generating unit and determines a suitable interest rate in order to calculate the present value of those cash flows. In the process of measuring expected future cash flows, management makes assumptions about future operating results. In addition, when determining the applicable discount rate, estimation is involved in determining the appropriate adjustments to market risk and asset-specific risk factors. These assumptions relate to future events and circumstances. Actual results may vary and may cause significant adjustments to the Company’s assets within the next financial year. Fair Value of the Embedded Derivatives in the Convertible Debentures The Company has determined that its functional currency is the Canadian dollar and has issued convertible debentures with face value in US dollars. Furthermore, the Company conversion feature of the 2018, 2019 and 2020 convertible debentures failed the fixed-for-fixed equity classification provision due to the debentures being denominated in a foreign currency and a variable number of shares being issuable. Fair Value of the Embedded Derivatives in the Convertible Debentures (Continued) As such, the convertible debentures consisted of a liability component (“financial liability”) and an embedded derivative conversion feature (“derivative liability”) and contra asset account of deferred derivative loss due to significant amount of fair value of the derivative liability at inception in excess of the net proceeds. The net proceeds of these convertible bonds were first allocated to the fair value of the derivative liability. As the fair value of the derivative liability at inception exceeds the net proceeds, the indication of significant loss at inception exists. As a result, nominal values of US$1,000 per newly issued convertible bonds were allocated to the financial liability. The remaining balance was set up as deferred derivative loss as a contra asset account. The deferred derivative losses were then amortized to profit and loss over the life of the convertible bonds. Subsequent changes in fair value of the conversion feature were recognized at FVTPL. The Company measures the fair value of the embedded derivative by reference to the fair value on the convertible debenture issuance date with an estimated life ending on the convertible debenture maturity date and revalues them at each reporting date. In determining the fair value of the embedded derivatives, the Company used the Black-Scholes option pricing model with the following assumptions: average volatility rate; market price at the reporting date; risk-free interest rate; the remaining expected life of the embedded derivatives and an exchange rate at the reporting date. The inputs used in the Black-Scholes model are taken from observable markets. Changes to assumptions used can affect the amounts recognized in the consolidated financial statements. |
RESTATED AND AMENDED FINANCIAL
RESTATED AND AMENDED FINANCIAL STATEMENTS | 12 Months Ended |
Dec. 31, 2020 | |
Restated And Amended Financial Statements | |
RESTATED AND AMENDED FINANCIAL STATEMENTS | The consolidated financial statements as at and for the year ended December 31, 2018 have been amended to correct for errors related to the US convertible promissory notes (the “Bonds”) issued in fiscal 2018 and outstanding as at December 31, 2018. In the 2018 annual financial statements, the Company classified the Bonds as compound instruments and recognized a liability component and an equity component related to the conversion feature of the Bonds. Under IAS 39, since the Bonds are denominated in US dollars which is not the functional currency of the Company, the conversion feature embedded in the Bonds should have been classified as a derivative liability. The overall instrument should have been classified as a financial liability and an embedded derivative conversion feature instead of a compound instrument as originally reported. Amended and restated consolidated statement of financial position: As at December 31, 2018 Previously Reported Adjustments As Restated $ $ $ Deferred loss on derivatives - 951,792 951,792 Derivative Liability - 733,339 733,339 Convertible Promissory Notes – Current 636,890 (611,349 ) 25,541 Convertible Promissory Notes Payable – Non-Current 11,961 (11,961 ) - Promissory Notes - 209,755 209,755 Share Capital 6,047,999 32,152 6,080,151 Retained Earnings (6,298,936 ) 599,857 (5,699,079 ) Amended and restated consolidated statement of comprehensive loss: Year ended December 31, 2018 Previously Reported Adjustments As Restated $ $ $ Accounting, Audit, and Legal 100,144 (17,669 ) 82,475 Accretion Expense - 7,039 7,039 Interest and Bank Charges 189,375 9,283 198,658 Foreign Exchange (Loss) Gain (26,711 ) 64,393 37,682 Change in Fair Value on Derivative Instruments - 534,118 534,118 Loss per share, basic and diluted $ 0.01 $ 0.01 Amended and restated consolidated statement of cash flows: Year ended December 31, 2018 Previously Reported Adjustment As Restated $ $ $ Net Loss for the Year (1,122,820 ) 599,857 (522,963 ) Non-Cash Items Change in Fair Value on Derivative Instruments - (534,118 ) (534,118 ) Accrued Interest on Convertible Promissory Notes - 195,412 195,412 Accretion Expenses - 7,039 7,039 Original Issue Discounts on Promissory Notes 36,653 (36,653 ) - Unrealized Foreign Exchange (Gain) Loss 58,346 (136,196 ) (77,850 ) Fees and Interest on Convertible Promissory Notes 186,128 (186,128 ) - Change in Non-Cash Working Capital Accounts 104,828 (1 ) 104,827 Net Proceeds on Issuance of Promissory Notes 686,590 108,457 795,047 The material impact of the correction on the audited consolidated financial statements for the year ended 2018 related to the Bonds was to increase the derivative assets by $951,792, increase the fair value of the derivative liabilities by $733,339, decrease the fair value of the Bonds by $413,556, increase the share capital by $32,152, and decrease the accumulated deficit by $599,857. |
SECURTER SYSTEMS INC.
SECURTER SYSTEMS INC. | 12 Months Ended |
Dec. 31, 2020 | |
Disclosure of detailed information about business combination [abstract] | |
SECURTER SYSTEMS INC. | On February 26, 2019, the Company entered into an agreement with Securter Inc., in terms of which a newly formed corporation, Securter Systems Inc. (“SSI”) would acquire all the assets and liabilities of Securter Inc. Upon incorporation, SSI issued 25,937,594 Class A common shares (“Original Class A Common Shares”) to the shareholders of Securter Inc. and 100,000 Class B common shares to the Company. Each Class B common share is non-participating and carries 1,000 votes. The Company shall have the right to purchase up to 30.3% Original Class A Common Shares of SSI at a price of US$0.23 per share for a total purchase consideration of up to US$3,000,000. As at December 31, 2019, SSI had 26,064,546 Original Class A Common Shares issued and outstanding whereby the Company held 126,951 of Original Class A Common Shares of SSI. Together with the Company’s holding in Class B common shares, the Company held a voting interest of 79.4% and a participating economic interest of 0.49% as at December 31, 2019. During the period January 1, 2020 to September 8, 2020, SSI issued a further 733,482 Original Class A Common Shares to the Company, giving the Company a voting interest of 79.1% and a participating economic interest of 3.13% or 860,433 Original Class A Common Shares in SSI as at September 8, 2020. On September 8, 2020, SSI effected a reorganization of its capital structure. All the issued and outstanding Original Class A Common Shares and Class B shares of SSI were cancelled, and new Class A shares (“New Class A Common Shares”) were issued. As a result of the reorganization, the Company received 4,396,000 New Class A Common Shares or 16% ownership of SSI in exchange for the Company’s return of its 860,433 Original Class A Common Shares and its 100,000 Class B common shares. Consequently, the Company ceased to hold voting control of SSI on September 8, 2020. The reorganization is accounted for as the disposition of SSI, the subsidiary by the Company. The fair value of the consideration received, the 4,396,000 New Class Common Shares or 16% economic interest in SSI is estimated at $Nil. This is based on the early stage of the business project of SSI and the uncertainty of ability to finance the development cost to commercialization of SSI’s business project. As of the date of disposal on September 8, 2020, the carrying value of SSI net assets and the loss on the spin-out are as follows: September 8, 2020 $ Intangible assets 29,840 Total non-current assets 29,840 Cash 17,086 Sales tax receivable 12,730 Total current assets 29.816 Accounts payable and accrued liabilities (31,095 ) Loan from non-controlling shareholders (29,380 ) Total current liabilities (60,475 ) Total net liabilities (819 ) The Company’s share of net assets 286,570 Non-controlling interest’s share of net liabilities (287,389 ) Total net liabilities (819 ) Cash consideration received - Cash and cash equivalent disposal of (17,086 ) Net cash (disposal of) (17,086 ) Fair value of consideration received - The Company’s share of net assets (286,570 ) Loss on Spin-out of SSI (286,570 ) January 1 to September 8, 2020 January 1 to December 31, 2019 $ $ LOSS FOR THE PERIODS FROM DISCONTINUED OPERATIONS EXPENSES Accounting, Audit and Legal 5,720 67,837 Advertising and Promotion - 74,669 Consulting Fees 12,739 16,200 Development Costs 97,579 - Exchange Rate Loss 2,371 - Interest and Bank Charges 297 137 General and Administration Expenses 2,700 - Salaries 6,231 - 127,637 158,843 January 1 to September 8, 2020 January 1 to December 31, 2019 CASH PROVIDED BY (USED FOR): $ $ DISCONTINUED OPERATIONS ACTIVITIES Net Loss for the Periods (127,637 ) (158,843 ) Adjustments for: Operating expenses contributed by shareholders 126,843 158,923 (794 ) 80 Non-Cash Items: Change in amounts receivable (12,659 ) (72 ) Change in trade and other payables 30,531 - Net cash from (used in) discontinued operations 17,078 8 INCREASE IN CASH 17,078 8 Cash, Beginning of the Period 8 - CASH, END OF THE PERIOD 17,086 8 During the year ended December 31, 2020, the Company had net cash used in the investment activities related to SSI: Cash used in investing activities related to Securter System Inc.: Cash invested in Securter Systems Inc. (128,815 ) (158,923 ) Unspent cash balance in Securter Systems Inc. end of December 31, 2019 - 8 Securter Systems Inc.’s cash disposed on deconsolidation (17,086 ) - Net cash (used in) investment in discontinued operations (145,901 ) (158,915 ) |
TRADE AND OTHER PAYABLES
TRADE AND OTHER PAYABLES | 12 Months Ended |
Dec. 31, 2020 | |
Trade and other payables [abstract] | |
TRADE AND OTHER PAYABLES | As at December 31, 2020 and 2019, the Company had the following amounts due to creditors: 2020 2019 $ $ Trade Payables 73,447 32,276 Accrued Liabilities 74,150 90,000 147,597 122,276 |
CONVERTIBLE PROMISSORY NOTES
CONVERTIBLE PROMISSORY NOTES | 12 Months Ended |
Dec. 31, 2020 | |
Convertible Promissory Notes | |
CONVERTIBLE PROMISSORY NOTES | Promissory Note Convertible Promissory Note - Liability Component Derivative Liability Deferred Derivative Loss (Increase) Total $ $ $ $ $ Balance December 31, 2018 209,755 25,541 733,339 (951,792 ) 16,843 Proceeds net of transaction costs - 13,328 1,517,944 (958,883 ) 572,389 Repayments (33,596 ) - - - (33,596 ) Conversions - (191,566 ) (1,545,331 ) 356,990 (1,379,907 ) Fair value change - - (335,758 ) 1,402,834 1,067,076 Interest expense - 58,470 - - 58,470 Accretion expense - 146,624 - - 146,624 Foreign exchange (gain) loss (10,461 ) (1,804 ) - - (12,265 ) Balance December 31, 2019 165,698 50,593 370,194 (150,851 ) 435,634 Promissory Note Convertible Promissory Note - Liability Component Derivative Liability Deferred Derivative Loss (Increase) Total $ $ $ $ $ Proceeds net of transaction costs - 13,396 1,216,301 (826,097 ) 403,600 Conversions - (140,768 ) (1,104,262 ) (170,994 ) (1,416,024 ) Fair value change - - 1,128,625 867,305 1,995,930 Interest expense - 30,785 - - 30,785 Accretion expense - 137,880 - - 137,880 Loss (gain) on settlement of debt (151,301 ) - - - (151,301 ) Foreign exchange (gain) loss (2,494 ) (165 ) - - (2,659 ) Balance December 31, 2020 11,903 91,721 1,610,858 (280,637 ) 1,433,845 The convertible bonds consisted of a liability component (“financial liability”) and an embedded derivative conversion feature (“derivative liability”) and contra asset account of deferred derivative loss due to significant amount of fair value of the derivative liability at inception in excess of the net proceeds. The net proceeds of these convertible bonds were first allocated to the fair value of the derivative liability. As the fair value of the derivative liability at inception exceeds the net proceeds, the indication of significant loss at inception exists. As a result, nominal values of US$1,000 per newly issued convertible bonds were allocated to the financial liability. The remaining balance was set up as deferred derivative loss as a contra asset account. The deferred derivative losses were then amortized to profit and loss over the life of the convertible bonds. Subsequent changes in fair value of the conversion feature were recognized at FVTPL (Note 2(k)). a) During the year ended December 31, 2019, at inception, the net proceeds of $572,389 (US$429,200 or gross proceeds of US$500,500 net of US$35,800 cash discount and $35,500 transaction costs) were allocated to the derivative liability at $1,517,944 related to the conversion feature which was determined using the Black-Scholes option pricing model. The remaining balance of the net proceeds were then allocated to nominal values of $13,328 (U$10,000 with U$1,000 per each convertible bond issued in 2019) and deferred derivative loss, a contra asset account of $958,883. b) During the year ended December 31, 2020, at inception, the net proceeds of $403,601 (US$299,910 or gross proceeds of US$332,000 net of cash discount in the amount of US$27,700 and transaction costs in the amount of US$4,390) were allocated to the derivative liability at $1,216,301 related to the conversion feature which was determined using the Black-Scholes option pricing model. The remaining balance of the net proceeds were then allocated to nominal values of $13,396 (US$10,000 with US$1,000 per each convertible bond issued in 2020) and deferred derivative loss, a contra asset account of $826,097. c) During the years ended December 31, 2020 and 2019, the Company recognized through profit and loss a change in the fair value of the derivative liability and the amortization of the deferred derivative loss of $1,995,930 (2019 – ($1,067,076)). As at December 31, 2020, the fair value of the derivative liability related to the conversion feature of $1,610,858 (2019 – $370,194) was determined using the Black-Scholes option pricing model based on the following assumptions: share price ranging from US$0.001 to US$0.004; a risk-free rate of 0.25%; stock price volatility ranging from 172% to 502%; dividend yield of 0%; and expected life of conversion features ranging from 0 to 0.8 years. d) During the years ended December 31, 2020 and 2019, the Company issued convertible promissory notes with gross proceeds of $446,738 (US$332,000) (2019 – $667,644 (US$500,500)). The notes are unsecured, bear interest at between 10% and 12% per annum from the date of issuance and mature between six months and one year after the date of issuance. Any amount of interest or principal that is not paid on the maturity date bears interest at 15% to 22% per annum from the maturity date to the date of payment. Any amount of principal and/or interest that is unpaid may be converted, at the option of the holder, in whole or in part into common shares of the Company at a price equal to 61% of the Market Price. The “Market Price” means either the lowest closing bid price for the Company’s stock as reported on the OTC during the fifteen trading days or the average of the two closing bid prices during the twenty-five trading days prior to a Notice of Conversion. The Company may prepay the principal and all accrued interest at any time between the date of issuance and the maturity date, together with a prepayment premium of between 15% and 40% of the amount prepaid, determined by reference to the date of repayment. e) During 2020, promissory notes with a face value of US$302,203 were converted into 759,908,896 common shares of the Company (2019 - US$591,316 converted and 356,153,022 common shares issued). f) On January 31, 2019, the Company repaid US$25,500, being the outstanding balance of a convertible promissory note issued to a consultant during 2018. |
SHARE CAPITAL
SHARE CAPITAL | 12 Months Ended |
Dec. 31, 2020 | |
Share Capital Abstract | |
SHARE CAPITAL | a) Authorized Capital Unlimited number of common shares, participating, voting (voting right of 1 vote per share), with no par value. 2,100,000 Class “B” common shares, non-participating, voting (voting right of 1,000 votes per share), with no par value. b) Issued and Outstanding Common Shares i. During 2018, the Company converted convertible promissory notes totaling $1,966,571 (US$1,358,100), and interest expense and finder’s fees owed, into 176,150,754 common shares of the Company. ii. On January 2, 2019, the Company passed a resolution to increase the authorized number of Class “B” common shares from 100,000 to 1,100,000. On the same day, the Company issued 1,000,000 Class “B” common shares at $0.0001 per share for total proceeds of $100 to a shareholder who is also a Director and Officer of the Company. iii. During fiscal 2019, the Company converted promissory notes with face value of US$591,316 into 356,153,022 common shares of the Company. An amount of $1,379,907 was allocated to the share capital in connection with these promissory note conversions. iv. During fiscal 2020, the Company converted promissory notes with face value of US$302,203 into 759,908,896 common shares of the Company. An amount of $1,416,024 was allocated to the share capital in connection with these promissory note conversions. v. On April 14, 2020, the Company passed a resolution to increase the authorized number of Class “B” common shares from 1,100,000 to 2,100,000. On the same day, the Company issued 1,000,000 Class “B” common shares at $0.0001 per share for total proceeds of $100 to a shareholder who is also a Director and Officer of the Company. c) Share-Based Payments i. During the year ended December 31, 2018, the Company entered into a consulting agreement for the provision of business strategy and compliance services. The Company issued 600,000 common shares valued at $7,373. ii. During the year ended December 31, 2019, the Company granted 10 million share purchase options at an exercise price of US$0.006 without any specified expiration date. The Company estimated the share-based compensation at $60,000 using Black-Scholes with the assumptions of risk free rate of 1.68%, volatility of 268% and option life of 7 years. d) Share Purchase Warrants The Company had no share purchase warrants outstanding for the years ended December 31, 2020, 2019, and 2018. e) Stock Options On February 14, 2019, the Company granted 5,750,000 stock options to directors of the Company and 4,250,000 stock options to consultants. The options have an exercise price of US$0.006 and expire on February 14, 2027. The continuity of stock options is summarized below: Expiry Date Exercise Price January 1, 2019 Granted 2019 Exercised Cancelled December 31, 2020 February 14, 2027 $ US0.006 - 10,000,000 - - 10,000,000 The Company did not issue any stock options in 2020. f) Escrow Shares On September 19, 2014, the Company entered into an escrow agreement with a creditor. The Company agreed to pay the creditor $2,500 upon signing of the agreement and to issue 1,500 shares to be held in escrow. The Company was obligated to pay the creditor a further $7,334 (US$6,687) forty-five days after the Company’s stock becomes DWAC-eligible. On December 22, 2016, the Company paid $5,374 (US$4,000) and the creditor agreed to release these shares from escrow. As of December 31, 2020, the 1,500 shares were held in trust by the corporate lawyer and have not been returned to the Company’s Treasury. |
COMMITMENTS
COMMITMENTS | 12 Months Ended |
Dec. 31, 2020 | |
Commitments | |
COMMITMENTS | a) Consulting Contracts i. On June 1, 2018 the Company entered into a consulting agreement for the provision of strategic business advisory services for a period of one year. The Company agreed to issue a convertible promissory note in the amount of US$50,000 and pay the consultant US$10,000 per month. ii. On October 22, 2018, the Company entered into a consulting contract with a Director for the provision of strategic business advisory services for a period of four months. The Company agreed to pay the Director $2,500 per month. |
SUPPLEMENTAL CASH FLOW INFORMAT
SUPPLEMENTAL CASH FLOW INFORMATION | 12 Months Ended |
Dec. 31, 2020 | |
Supplemental Cash Flow Information | |
SUPPLEMENTAL CASH FLOW INFORMATION | 2020 2019 2018 $ $ $ (Restated –Note 4) (a) Change in Non-Cash Working Capital Accounts Accounts Receivable - - 297,308 GST Recoverable 1,540 (2,469 ) (2,128 ) Prepaid Expenses - - (18,608 ) Trade and Other Payables 25,320 (7,003 ) 125,564 Liabilities to Customers - - (297,309 ) 26,860 (9,472 ) 104,827 (b) Significant Non-Cash Financing Activities Shares Issued for Services - - 7,373 Shares Issued on Conversion of Convertible Promissory Notes 1,416,023 1,379,907 1,934,419 1,416,023 1,379,907 1,941,792 (c) Other Information Interest Paid 31,621 59,138 186,128 Income Taxes Paid - - - |
INCOME TAX
INCOME TAX | 12 Months Ended |
Dec. 31, 2020 | |
Income Tax | |
INCOME TAX | a) Deferred Tax Assets and Liabilities The Company’s unrecognized deductible temporary differences and unused tax losses for which no deferred tax asset is recognized consists of the following amounts: 2020 2019 $ $ Non-Capital Losses 7,343,728 7,052,500 Capital Losses 29,629 29,628 Property and Equipment 100,490 100,490 7,473,847 7,182,618 As at December 31, 2020, the Company has non-capital losses of approximately $7,343,700 which may be applied to reduce Canadian taxable income of future years. These non-capital losses expire as follows: $ 2026 313,100 2027 515,300 2028 367,400 2029 1,157,900 2030 307,400 2031 301,400 2032 233,000 2033 to 2040 4,148,200 7,343,700 b) Income Tax Expense The income tax expense of the Company is reconciled to the net loss for the year as reported in the consolidated statement of comprehensive loss as follows: 2020 2019 2018 $ $ $ (Restated –Note 4) Recovery of Income Tax Calculated at the Statutory Rate of 11% (2019 – 12%; 2018 – 12%) (298,306 ) (289,340 ) (62,756 ) Deferred Tax Assets Not Recognized (39,649 ) 289,340 36,948 Impact of Change in Substantively Enacted Tax Rates on Opening Deferred Tax Assets 71,680 - 25,808 Other permanent differences 266,275 - - Income Tax Expense - - - |
RELATED PARTIES TRANSACTIONS
RELATED PARTIES TRANSACTIONS | 12 Months Ended |
Dec. 31, 2020 | |
Related party transactions [abstract] | |
RELATED PARTIES TRANSACTIONS | Balances and transactions between the Company and its subsidiaries, which are related parties of the Company, have been eliminated on consolidation and are not disclosed. Details of transactions between the Company and other related parties, in addition to those transactions disclosed elsewhere in these consolidated financial statements, are described below. All related party transactions were in the ordinary course of business and were measured at their exchange amounts. a) Compensation of Key Management Personnel i. The Company incurred management fees for services provided by key management personnel for the years ended December 31, 2020, 2019 and 2018, as described below. 2020 2019 2018 $ $ $ Management Fees 133,939 244,120 241,950 ii. During the year ended December 31, 2020 the Company granted nil stock options (2019 - 5,750,000) to directors of the Company, recording an expense of $nil (2019 - $34,500). The options have an exercise price of US$0.006 and expire on February 14, 2027. iii. During the year ended December 31, 2020, the Company incurred consulting fees for services provided by a former director of the Company in the amount of $nil (2019 - $19,125 up to the date of his resignation as a director on May 22, 2019. The Company paid $16,200 to this former director subsequent to his resignation.) |
FINANCIAL RISK MANAGEMENT OBJEC
FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES | 12 Months Ended |
Dec. 31, 2020 | |
Financial Risk Management Objectives And Policies | |
FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES | The Company is exposed to various risks in relation to financial instruments. The Company’s financial assets and liabilities by category are summarized in Note 2(k). The Company’s risk management is coordinated in close co-operation with the board of directors and focuses on actively securing the Company’s short to medium-term cash flows and raising financing for the Company’s capital expenditure program. The Company does not actively engage in the trading of financial assets for speculative purposes. The most significant financial risks to which the Company is exposed are as follows: a) Liquidity risk Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they fall due. The Company is dependent upon the availability of credit from its suppliers and its ability to generate sufficient funds from equity and debt financing to meet current and future obligations. The Company has a working capital deficiency of $238,702 as at December 31, 2020. There can be no assurance that such debt or equity financing will be available to the Company. b) Interest Rate Risk Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company is not exposed to significant interest rate risk as the interest rates associated with the convertible promissory notes are fixed. c) Credit Risk Credit risk is the risk of loss associated with a counter party’s inability to fulfill its payment obligations. As the Company is in the development stage and has not yet commenced commercial production or sales, it is not exposed to significant credit risk. d) Foreign Exchange Risk Foreign exchange risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in foreign exchange rates. The Company is exposed to foreign exchange risk to the extent it incurs currency exchange platform service and development expenditures and operating costs in foreign currencies including the U.S. Dollar. The Company does not hedge its exposure to fluctuations in the related foreign exchange rates. e) Fair Values The Company uses the following hierarchy for determining fair value measurements: Level 1: Quoted prices in active markets for identical assets or liabilities. Level 2: Other techniques for which all inputs which have a significant effect on the recorded fair value are observable, either directly or indirectly. Level 3: Techniques which use inputs that have a significant effect on the recorded fair value that are not based on observable market data. The level within which the financial asset or liability is classified is determined based on the lowest level of significant input to the fair value measurement. The Company’s financial instruments were measured at fair value using Level 1 valuation technique during the years ended December 31, 2020, 2019 and 2018. The carrying values of the Company’s financial assets and liabilities approximate their fair values. |
CAPITAL MANAGEMENT
CAPITAL MANAGEMENT | 12 Months Ended |
Dec. 31, 2020 | |
Capital Management | |
CAPITAL MANAGEMENT | The Company’s objective for managing its capital structure is to safeguard the Company’s ability to continue as a going concern and to ensure it has the financial capacity, liquidity and flexibility to fund its ongoing operations and capital expenditures. The Company manages its share capital as capital, which as at December 31, 2020, amounted to $8,876,281. At this time, the Company’s access to the debt market is limited and it relies on equity issuances and the support of shareholders to fund the development of its business. The Company monitors capital to maintain a sufficient working capital position to fund annualized administrative expenses and capital investments. As at December 31, 2020, the Company had a working capital deficiency of $238,702. The Company will issue shares and may from time to time adjust its capital spending to maintain or adjust the capital structure. There can be no assurance that the Company will be able to obtain debt or equity capital in the case of operating cash deficits. The Company’s share capital is not subject to external restrictions. The Company has not paid or declared any dividends since the date of incorporation, nor are any contemplated in the foreseeable future. There were no changes in the Company’s approach to capital management during the year ended December 31, 2020. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 12 Months Ended |
Dec. 31, 2020 | |
Disclosure of non-adjusting events after reporting period [abstract] | |
SUBSEQUENT EVENTS | a) Issuance of Convertible Promissory Notes Subsequent to December 31, 2020, the Company issued further convertible promissory notes raising net proceeds of $174,127 (US$137,000). The notes are unsecured, bear interest at 12% per annum from the date of issuance and mature between six months and one year after the date of issuance. Any amount of interest or principal that is not paid on the maturity date bears interest at 22% per annum from the maturity date to the date of payment. Any amount of principal and/or interest that is unpaid may be converted, at the option of the holder, in whole or in part into common shares of the Company at a price equal to 61% of the lowest closing bid price for the Company’s stock as reported on the OTC during the fifteen trading days prior to a Notice of Conversion. The Company may prepay the principal and all accrued interest at any time between the date of issuance and the maturity date, together with a prepayment premium of between 15% and 40% of the amount prepaid, determined by reference to the date of repayment. b) Conversion of Convertible Promissory Notes Subsequent to December 31, 2020, certain convertible promissory notes with a face value of US$153,880 were converted into 87,526,697 common shares of the Company. |
SIGNIFICANT ACCOUNTING POLICI_2
SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2020 | |
Significant Accounting Policies | |
Basis of Presentation | These consolidated financial statements have been prepared on a historical cost basis except for financial instruments classified as available-for-sale that have been measured at fair value. Cost is the fair value of the consideration given in exchange for net assets. |
Statement of Compliance | These consolidated financial statements have been prepared in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”). These consolidated financial statements were approved and authorized for issue by the Board of Directors on April 09, 2021. |
Basis of Consolidation | These consolidated financial statements include the accounts of the Company and its subsidiaries (collectively, the “Company”). Intercompany balances and transactions are eliminated in preparing the consolidated financial statements. The following companies have been consolidated within these consolidated financial statements: Entity Country of Incorporation Voting Control Functional Currency Digatrade Financial Corp. Canada Parent Company Canadian Dollar Digatrade Limited Canada 100% Canadian Dollar Digatrade (UK) Limited United Kingdom 100% Pounds Sterling Digatrade Limited USA 100% US Dollar |
Foreign Currency | These consolidated financial statements are presented in Canadian dollars, which is also the functional currency of the parent company. Each subsidiary determines its own functional currency (Note 2(c)) and items included in the financial statements of each subsidiary are measured using that functional currency. i. Transactions and Balances in Foreign Currencies Foreign currency transactions are translated into the functional currency of the respective entity using the exchange rates prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the re-measurement of monetary items at year-end exchange rates are recognized in profit or loss. Non-monetary items measured at historical cost are translated using the exchange rate at the date of the transaction and are not retranslated. Non-monetary items measured at fair value are translated using the exchange rate at the date when fair value was determined. ii. Foreign Operations On consolidation, the assets and liabilities of foreign operations are translated into Canadian dollars at the exchange rate prevailing at the reporting date and their revenues and expenses are translated at exchange rates prevailing at the dates of the transactions. The exchange differences arising on the translation are recognized in other comprehensive income and accumulated in the currency translation reserve in equity. On disposal of a foreign operation, the component of other comprehensive income relating to that particular foreign operation is recognized in earnings and recognized as part of the gain or loss on disposal. |
Financing and Finder's Fees | Financing and finder’s fees relating to financial instruments with a term of one year or less are expensed in the period incurred. For financial instruments with a term of over one year, the fees are netted against the financial instruments and amortized over the term of the financial instruments. |
Share Capital | The Company records proceeds from share issuances, net of commissions and issuance costs. Shares issued for other than cash consideration are valued at either: (i) the fair value of the asset acquired or the fair value of the liability extinguished at the measurement date under current market conditions, or (ii) the quoted price on the Over-the-Counter Bulletin Board in the United States based on the earliest of: the date the shares are issued, or the date the agreement to issue the shares is reached. |
Loss per Share | Basic loss per share is calculated by dividing net loss by the weighted average number of common shares issued and outstanding during the reporting period. Diluted loss per share is the same as basic loss per share, as the issuance of shares on the exercise of stock options and share purchase warrants is anti-dilutive. |
Share-Based Payments | The fair value method of accounting is used for share-based payment transactions. Under this method, the cost of stock options and other share-based payments is recorded based on the estimated fair value using the Black-Scholes option-pricing model at the grant date and charged to profit over the vesting period. The amount recognized as an expense is adjusted to reflect the number of equity instruments expected to vest. Upon the exercise of stock options and other share-based payments, consideration received on the exercise of these equity instruments is recorded as share capital and the related share-based payment reserve is transferred to share capital. The fair value of unexercised equity instruments are transferred from reserve to retained earnings upon expiry. |
Income Taxes | Tax expense recognized in profit or loss comprises the sum of deferred tax and current tax not recognized in other comprehensive income or directly in equity. i. Current Income Tax Current income tax assets and liabilities comprise those claims from, or obligations to, fiscal authorities relating to the current or prior reporting periods that are unpaid at the reporting date. Current tax is payable on taxable profit, which differs from profit or loss in the consolidated financial statements. Calculation of current tax is based on tax rates and tax laws that have been enacted or substantively enacted by the end of the reporting period. ii. Deferred Income Tax Deferred income taxes are calculated using the liability method on temporary differences between the carrying amounts of assets and liabilities and their tax bases. Deferred tax assets and liabilities are calculated, without discounting, at tax rates that are expected to apply to their respective period of realization, provided they are enacted or substantively enacted by the end of the reporting period. Deferred tax liabilities are always provided for in full. Deferred tax assets are recognized to the extent that it is probable that they will be able to be utilized against future taxable income. Deferred tax assets and liabilities are offset only when the Company has a right and intention to offset current tax assets and liabilities from the same taxation authority. Changes in deferred tax assets or liabilities are recognized as a component of tax income or expense in profit or loss, except where they relate to items that are recognized in other comprehensive income or directly in equity, in which case the related deferred tax is also recognized in other comprehensive income or equity, respectively. |
Revenue Recognition | Revenue is comprised of consulting fees and commissions earned on trades executed on the digital currency trading platform. Consulting fee income is recognized as the consulting services are provided. Commission is considered earned when a trade is completed by the Company’s customers. As the platform is not yet fully live, commissions and consulting fees earned have been accounted for as a recovery of development costs incurred. |
Financial Instruments | The following is the Company’s accounting policy for financial instruments under IFRS 9: (i) Classification The Company classifies its financial instruments in the following categories: at fair value through profit and loss (“FVTPL”), at fair value through other comprehensive income (loss) (“FVTOCI”) or at amortized cost. The Company determines the classification of financial assets at initial recognition. The classification of debt instruments is driven by the Company’s business model for managing the financial assets and their contractual cash flow characteristics. Equity instruments that are held for trading are classified as FVTPL. For other equity instruments, on the day of acquisition the Company can make an irrevocable election (on an instrument-by-instrument basis) to designate them as at FVTOCI. Financial liabilities are measured at amortized cost, unless they are required to be measured at FVTPL (such as instruments held for trading or derivatives) or if the Company has opted to measure them at FVTPL. The following table shows the classification under IFRS 9: Financial assets/liabilities Classification Cash FVTPL Marketable Securities FVTPL Accounts payable Amortized cost (ii) Measurement Financial assets and liabilities at amortized cost Financial assets and liabilities at amortized cost are initially recognized at fair value plus or minus transaction costs, respectively, and subsequently carried at amortized cost less any impairment. Financial assets and liabilities at FVTPL Financial assets and liabilities carried at FVTPL are initially recorded at fair value and transaction costs are expensed in the Consolidated Statements of Comprehensive Income. Realized and unrealized gains and losses arising from changes in the fair value of the financial assets and liabilities held at FVTPL are included in the Consolidated Statements of Comprehensive Income in the period in which they arise. (iii) Impairment of financial assets The Company recognizes a loss allowance for expected credit losses on financial assets that are measured at amortized cost. At each reporting date, the Company measures the loss allowance for the financial asset at an amount equal to the lifetime expected credit losses if the credit risk on the financial asset has increased significantly since initial recognition. If at the reporting date, the financial asset has not increased significantly since initial recognition, the Company measures the loss allowance for the financial asset at an amount equal to twelve month expected credit losses. The Company shall recognize in the Consolidated Statements of Comprehensive Income, as an impairment gain or loss, the amount of expected credit losses (or reversal) that is required to adjust the loss allowance at the reporting date to the amount that is required to be recognized. |
Non-Controlling Interest | Non-controlling interest in the Company’s less than wholly owned subsidiary is classified as a separate component of equity. On initial recognition, non-controlling interest is measured at the fair value of the non-controlling entity’s contribution into the related subsidiary. Subsequent to the original transaction date, adjustments are made to the carrying amount of non-controlling interest for the non-controlling interest’s share of changes to the subsidiary’s equity. |
Accounting Standards Effective January 1, 2019 - IFRS 16 - Leases | Amendments to IFRS 7 and 9 and IAS 39 On September 26, 2019, IASB amended some of the existing IFRSs requirements for hedge accounting. The amendments are designed to support the provision of useful financial information by companies during the period of uncertainty arising from the phasing out of interest-rate benchmarks such as IBORs. The amendments modify some specific hedge accounting requirements to provide relief from potential effects of the uncertainty caused by the IBOR reform. In addition, the amendments require companies to provide additional information to investors about their hedging relationships which are directly affected by these uncertainties. These amendments were effective for annual periods beginning on or after January 1, 2020 and must be applied retrospectively. Early application is permitted. |
SIGNIFICANT ACCOUNTING POLICI_3
SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Significant Accounting Policies | |
Subsidiaries | Entity Country of Incorporation Voting Control Functional Currency Digatrade Financial Corp. Canada Parent Company Canadian Dollar Digatrade Limited Canada 100% Canadian Dollar Digatrade (UK) Limited United Kingdom 100% Pounds Sterling Digatrade Limited USA 100% US Dollar |
New classifications under IFRS 9 | Financial assets/liabilities Classification Cash FVTPL Marketable Securities FVTPL Accounts payable Amortized cost |
RESTATED AND AMENDED FINANCIA_2
RESTATED AND AMENDED FINANCIAL STATEMENTS (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Restated And Amended Financial Statements | |
Restated and amended financial statements | As at December 31, 2018 Previously Reported Adjustments As Restated $ $ $ Deferred loss on derivatives - 951,792 951,792 Derivative Liability - 733,339 733,339 Convertible Promissory Notes – Current 636,890 (611,349 ) 25,541 Convertible Promissory Notes Payable – Non-Current 11,961 (11,961 ) - Promissory Notes - 209,755 209,755 Share Capital 6,047,999 32,152 6,080,151 Retained Earnings (6,298,936 ) 599,857 (5,699,079 ) Amended and restated consolidated statement of comprehensive loss: Year ended December 31, 2018 Previously Reported Adjustments As Restated $ $ $ Accounting, Audit, and Legal 100,144 (17,669 ) 82,475 Accretion Expense - 7,039 7,039 Interest and Bank Charges 189,375 9,283 198,658 Foreign Exchange (Loss) Gain (26,711 ) 64,393 37,682 Change in Fair Value on Derivative Instruments - 534,118 534,118 Loss per share, basic and diluted $ 0.01 $ 0.01 Amended and restated consolidated statement of cash flows: Year ended December 31, 2018 Previously Reported Adjustment As Restated $ $ $ Net Loss for the Year (1,122,820 ) 599,857 (522,963 ) Non-Cash Items Change in Fair Value on Derivative Instruments - (534,118 ) (534,118 ) Accrued Interest on Convertible Promissory Notes - 195,412 195,412 Accretion Expenses - 7,039 7,039 Original Issue Discounts on Promissory Notes 36,653 (36,653 ) - Unrealized Foreign Exchange (Gain) Loss 58,346 (136,196 ) (77,850 ) Fees and Interest on Convertible Promissory Notes 186,128 (186,128 ) - Change in Non-Cash Working Capital Accounts 104,828 (1 ) 104,827 Net Proceeds on Issuance of Promissory Notes 686,590 108,457 795,047 |
SECURTER SYSTEMS INC. (Tables)
SECURTER SYSTEMS INC. (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Disclosure of detailed information about business combination [abstract] | |
Summarized financial statements of Securter Systems Inc. | September 8, 2020 $ Intangible assets 29,840 Total non-current assets 29,840 Cash 17,086 Sales tax receivable 12,730 Total current assets 29.816 Accounts payable and accrued liabilities (31,095 ) Loan from non-controlling shareholders (29,380 ) Total current liabilities (60,475 ) Total net liabilities (819 ) The Company’s share of net assets 286,570 Non-controlling interest’s share of net liabilities (287,389 ) Total net liabilities (819 ) Cash consideration received - Cash and cash equivalent disposal of (17,086 ) Net cash (disposal of) (17,086 ) Fair value of consideration received - The Company’s share of net assets (286,570 ) Loss on Spin-out of SSI (286,570 ) January 1 to September 8, 2020 January 1 to December 31, 2019 $ $ LOSS FOR THE PERIODS FROM DISCONTINUED OPERATIONS EXPENSES Accounting, Audit and Legal 5,720 67,837 Advertising and Promotion - 74,669 Consulting Fees 12,739 16,200 Development Costs 97,579 - Exchange Rate Loss 2,371 - Interest and Bank Charges 297 137 General and Administration Expenses 2,700 - Salaries 6,231 - 127,637 158,843 January 1 to September 8, 2020 January 1 to December 31, 2019 CASH PROVIDED BY (USED FOR): $ $ DISCONTINUED OPERATIONS ACTIVITIES Net Loss for the Periods (127,637 ) (158,843 ) Adjustments for: Operating expenses contributed by shareholders 126,843 158,923 (794 ) 80 Non-Cash Items: Change in amounts receivable (12,659 ) (72 ) Change in trade and other payables 30,531 - Net cash from (used in) discontinued operations 17,078 8 INCREASE IN CASH 17,078 8 Cash, Beginning of the Period 8 - CASH, END OF THE PERIOD 17,086 8 During the year ended December 31, 2020, the Company had net cash used in the investment activities related to SSI: Cash used in investing activities related to Securter System Inc.: Cash invested in Securter Systems Inc. (128,815 ) (158,923 ) Unspent cash balance in Securter Systems Inc. end of December 31, 2019 - 8 Securter Systems Inc.’s cash disposed on deconsolidation (17,086 ) - Net cash (used in) investment in discontinued operations (145,901 ) (158,915 ) |
TRADE AND OTHER PAYABLES (Table
TRADE AND OTHER PAYABLES (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Trade and other payables [abstract] | |
Trade and other paybles | 2020 2019 $ $ Trade Payables 73,447 32,276 Accrued Liabilities 74,150 90,000 147,597 122,276 |
CONVERTIBLE PROMISSORY NOTES (T
CONVERTIBLE PROMISSORY NOTES (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Convertible Promissory Notes | |
Convertible promissory notes | Promissory Note Convertible Promissory Note - Liability Component Derivative Liability Deferred Derivative Loss (Increase) Total $ $ $ $ $ Balance December 31, 2018 209,755 25,541 733,339 (951,792 ) 16,843 Proceeds net of transaction costs - 13,328 1,517,944 (958,883 ) 572,389 Repayments (33,596 ) - - - (33,596 ) Conversions - (191,566 ) (1,545,331 ) 356,990 (1,379,907 ) Fair value change - - (335,758 ) 1,402,834 1,067,076 Interest expense - 58,470 - - 58,470 Accretion expense - 146,624 - - 146,624 Foreign exchange (gain) loss (10,461 ) (1,804 ) - - (12,265 ) Balance December 31, 2019 165,698 50,593 370,194 (150,851 ) 435,634 Promissory Note Convertible Promissory Note - Liability Component Derivative Liability Deferred Derivative Loss (Increase) Total $ $ $ $ $ Proceeds net of transaction costs - 13,396 1,216,301 (826,097 ) 403,600 Conversions - (140,768 ) (1,104,262 ) (170,994 ) (1,416,024 ) Fair value change - - 1,128,625 867,305 1,995,930 Interest expense - 30,785 - - 30,785 Accretion expense - 137,880 - - 137,880 Loss (gain) on settlement of debt (151,301 ) - - - (151,301 ) Foreign exchange (gain) loss (2,494 ) (165 ) - - (2,659 ) Balance December 31, 2020 11,903 91,721 1,610,858 (280,637 ) 1,433,845 |
SHARE CAPITAL (Tables)
SHARE CAPITAL (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Share Capital Abstract | |
Stock option activity | Expiry Date Exercise Price January 1, 2019 Granted 2019 Exercised Cancelled December 31, 2020 February 14, 2027 $ US0.006 - 10,000,000 - - 10,000,000 |
SUPPLEMENTAL CASH FLOW INFORM_2
SUPPLEMENTAL CASH FLOW INFORMATION (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Supplemental Cash Flow Information | |
Supplemental cash flow information | 2020 2019 2018 $ $ $ (Restated –Note 4) (a) Change in Non-Cash Working Capital Accounts Accounts Receivable - - 297,308 GST Recoverable 1,540 (2,469 ) (2,128 ) Prepaid Expenses - - (18,608 ) Trade and Other Payables 25,320 (7,003 ) 125,564 Liabilities to Customers - - (297,309 ) 26,860 (9,472 ) 104,827 (b) Significant Non-Cash Financing Activities Shares Issued for Services - - 7,373 Shares Issued on Conversion of Convertible Promissory Notes 1,416,023 1,379,907 1,934,419 1,416,023 1,379,907 1,941,792 (c) Other Information Interest Paid 31,621 59,138 186,128 Income Taxes Paid - - - |
INCOME TAX (Tables)
INCOME TAX (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Income Tax | |
Deferred tax assets and liabilities | 2020 2019 $ $ Non-Capital Losses 7,343,728 7,052,500 Capital Losses 29,629 29,628 Property and Equipment 100,490 100,490 7,473,847 7,182,618 |
Non-capital loss carryforwards | $ 2026 313,100 2027 515,300 2028 367,400 2029 1,157,900 2030 307,400 2031 301,400 2032 233,000 2033 to 2040 4,148,200 7,343,700 |
Income tax expense | 2020 2019 2018 $ $ $ (Restated –Note 4) Recovery of Income Tax Calculated at the Statutory Rate of 11% (2019 – 12%; 2018 – 12%) (298,306 ) (289,340 ) (62,756 ) Deferred Tax Assets Not Recognized (39,649 ) 289,340 36,948 Impact of Change in Substantively Enacted Tax Rates on Opening Deferred Tax Assets 71,680 - 25,808 Other permanent differences 266,275 - - Income Tax Expense - - - |
RELATED PARTIES TRANSACTIONS (T
RELATED PARTIES TRANSACTIONS (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Related party transactions [abstract] | |
Management fees and share-based payments | 2020 2019 2018 Management Fees $ 133,939 $ 244,120 $ 241,950 |
NATURE AND CONTINUANCE OF OPE_2
NATURE AND CONTINUANCE OF OPERATIONS (Details Narrative) - CAD ($) | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
Nature And Continuance Of Operations | |||
Accumulated losses | $ (10,505,204) | $ (7,793,332) | $ (5,699,079) |
Working capital deficit | $ (238,702) |
SIGNIFICANT ACCOUNTING POLICI_4
SIGNIFICANT ACCOUNTING POLICIES (Details) | 12 Months Ended |
Dec. 31, 2020 | |
Parent Company | |
Disclosure of subsidiaries [line items] | |
Entity | Digatrade Financial Corp. |
Country of incorporation | Canada |
Holding interest | 100.00% |
Functional currency | Canadian Dollar |
Subsidiary 1 | |
Disclosure of subsidiaries [line items] | |
Entity | Digatrade Limited |
Country of incorporation | Canada |
Holding interest | 100.00% |
Functional currency | Canadian Dollar |
Subsidiary 2 | |
Disclosure of subsidiaries [line items] | |
Entity | Digatrade (UK) Limited |
Country of incorporation | United Kingdom |
Holding interest | 100.00% |
Functional currency | Pounds Sterling |
Subsidiary 3 | |
Disclosure of subsidiaries [line items] | |
Entity | Digatrade Limited |
Country of incorporation | USA |
Holding interest | 100.00% |
Functional currency | US Dollar |
SIGNIFICANT ACCOUNTING POLICI_5
SIGNIFICANT ACCOUNTING POLICIES (Details 1) | 12 Months Ended |
Dec. 31, 2020 | |
Cash | |
DisclosureOfChangesInClassificationsLineItems [Line Items] | |
Classification under IFRS 9 | FVTPL |
Marketable Securities | |
DisclosureOfChangesInClassificationsLineItems [Line Items] | |
Classification under IFRS 9 | FVTPL |
Accounts Payable | |
DisclosureOfChangesInClassificationsLineItems [Line Items] | |
Classification under IFRS 9 | Amortized cost |
RESTATED AND AMENDED FINANCIA_3
RESTATED AND AMENDED FINANCIAL STATEMENTS (Details) - CAD ($) | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
DisclosureOfRestatedAndAmendedFinancialStatementsLineItems [Line Items] | |||
Deferred loss on derivatives | $ 280,637 | $ 150,851 | $ 951,792 |
Derivative liability | 1,610,858 | 370,194 | 733,339 |
Convertible promissory notes - current | 91,721 | 50,593 | 25,541 |
Convertible promissory notes payable - non-current | 0 | ||
Promissory notes | 11,904 | 165,698 | 209,755 |
Share capital | 8,876,281 | 7,460,158 | 6,080,151 |
Retained earnings | $ (10,505,204) | $ (7,793,332) | (5,699,079) |
Previously Reported | |||
DisclosureOfRestatedAndAmendedFinancialStatementsLineItems [Line Items] | |||
Deferred loss on derivatives | 0 | ||
Derivative liability | 0 | ||
Convertible promissory notes - current | 636,890 | ||
Convertible promissory notes payable - non-current | 11,961 | ||
Promissory notes | 0 | ||
Share capital | 6,047,999 | ||
Retained earnings | (6,298,936) | ||
Adjustments | |||
DisclosureOfRestatedAndAmendedFinancialStatementsLineItems [Line Items] | |||
Deferred loss on derivatives | 951,792 | ||
Derivative liability | 733,339 | ||
Convertible promissory notes - current | (611,349) | ||
Convertible promissory notes payable - non-current | (11,961) | ||
Promissory notes | 209,755 | ||
Share capital | 32,152 | ||
Retained earnings | $ 599,857 |
RESTATED AND AMENDED FINANCIA_4
RESTATED AND AMENDED FINANCIAL STATEMENTS (Details 1) - CAD ($) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
DisclosureOfRestatedAndAmendedFinancialStatementsLineItems [Line Items] | |||
Accounting, audit, and legal | $ 109,154 | $ 57,143 | $ 82,475 |
Accretion expenses | 137,880 | 146,624 | 7,039 |
Interest and bank charges | 30,785 | 58,470 | 198,658 |
Foreign exchange (loss) gain | 2,485 | 48,045 | 37,682 |
Change in fair value on derivative instruments | $ (1,995,930) | $ (1,067,076) | $ 534,118 |
Loss per share, basic and diluted | $ 0.01 | $ 0.01 | $ 0.01 |
Previously Reported | |||
DisclosureOfRestatedAndAmendedFinancialStatementsLineItems [Line Items] | |||
Accounting, audit, and legal | $ 100,144 | ||
Accretion expenses | 0 | ||
Interest and bank charges | 189,375 | ||
Foreign exchange (loss) gain | (26,711) | ||
Change in fair value on derivative instruments | $ 0 | ||
Loss per share, basic and diluted | $ 0.01 | ||
Adjustments | |||
DisclosureOfRestatedAndAmendedFinancialStatementsLineItems [Line Items] | |||
Accounting, audit, and legal | $ (17,669) | ||
Accretion expenses | 7,039 | ||
Interest and bank charges | 9,283 | ||
Foreign exchange (loss) gain | 64,393 | ||
Change in fair value on derivative instruments | $ 534,118 | ||
Loss per share, basic and diluted | $ (.00) |
RESTATED AND AMENDED FINANCIA_5
RESTATED AND AMENDED FINANCIAL STATEMENTS (Details 2) - CAD ($) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
DisclosureOfRestatedAndAmendedFinancialStatementsLineItems [Line Items] | |||
Net loss for the year | $ (2,425,053) | $ (2,093,481) | $ (522,963) |
Non-Cash Items | |||
Change in valuation of derivative instruments | 1,995,930 | 1,067,076 | (534,118) |
Accrued interest on promissory notes | 30,785 | 58,470 | 195,412 |
Accretion expenses | 137,880 | 146,624 | 7,039 |
Original issue discounts on promissory notes | 0 | ||
Unrealized foreign exchange (gain) loss | (2,658) | (12,264) | (77,850) |
Fees and interest on convertible promissory notes | 0 | ||
Change in non-cash working capital accounts | 26,860 | (9,472) | 104,827 |
Net proceeds on issuance of promissory notes | $ 403,600 | $ 572,389 | 795,047 |
Previously Reported | |||
DisclosureOfRestatedAndAmendedFinancialStatementsLineItems [Line Items] | |||
Net loss for the year | (1,122,820) | ||
Non-Cash Items | |||
Change in valuation of derivative instruments | 0 | ||
Accrued interest on promissory notes | 0 | ||
Accretion expenses | 0 | ||
Original issue discounts on promissory notes | 36,653 | ||
Unrealized foreign exchange (gain) loss | 58,346 | ||
Fees and interest on convertible promissory notes | 186,128 | ||
Change in non-cash working capital accounts | 104,828 | ||
Net proceeds on issuance of promissory notes | 686,590 | ||
Adjustments | |||
DisclosureOfRestatedAndAmendedFinancialStatementsLineItems [Line Items] | |||
Net loss for the year | 599,857 | ||
Non-Cash Items | |||
Change in valuation of derivative instruments | (534,118) | ||
Accrued interest on promissory notes | 195,412 | ||
Accretion expenses | 7,039 | ||
Original issue discounts on promissory notes | (36,653) | ||
Unrealized foreign exchange (gain) loss | (136,196) | ||
Fees and interest on convertible promissory notes | (186,128) | ||
Change in non-cash working capital accounts | (1) | ||
Net proceeds on issuance of promissory notes | $ 108,457 |
SECURTER SYSTEMS INC. (Details)
SECURTER SYSTEMS INC. (Details) - CAD ($) | 12 Months Ended | |
Dec. 31, 2020 | Sep. 08, 2020 | |
Disclosure of detailed information about business combination [abstract] | ||
Intangible assets | $ 29,840 | |
Total current net assets | 29,840 | |
Cash | 17,086 | |
Sales tax receivable | 12,736 | |
Current assets | 29,816 | |
Accounts payable and accrued liabilities | (31,095) | |
Loan from non-controlling shareholders | (29,380) | |
Current liabilities | (60,475) | |
Total net liabilities | (819) | |
The Company's share of net assets | 286,570 | |
Non-controlling intere's share of net liabilities | (287,389) | |
Total net liabilities | (819) | |
Cash consideration received | $ 0 | |
Cash and cash equivalent disposal of | (17,086) | |
Net cash (disposal of) | (17,086) | |
Fair value of consideration received | 0 | |
The Company's share of net assets | $ (286,570) | |
Loss on Spin-out of SSI | $ (286,570) |
SECURTER SYSTEMS INC. (Details
SECURTER SYSTEMS INC. (Details 1) - CAD ($) | 8 Months Ended | 12 Months Ended |
Sep. 08, 2020 | Dec. 31, 2019 | |
Disclosure of detailed information about business combination [abstract] | ||
Accounting, audit and legal | $ 5,720 | $ 67,837 |
Advertising and promotion | 0 | 74,669 |
Consulting fees | 12,739 | 16,200 |
Development costs | 97,579 | 0 |
Exchange rate loss | 2,371 | 0 |
Interest bank charges | 297 | 137 |
General and adminstration expenses | 2,700 | 0 |
Salaries | 6,231 | 0 |
Expenses | $ 127,637 | $ 158,843 |
SECURTER SYSTEMS INC. (Detail_2
SECURTER SYSTEMS INC. (Details 2) - CAD ($) | 8 Months Ended | 12 Months Ended | ||
Sep. 08, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
CASH PROVIDED BY (USED FOR): DISCONTINUED OPERATIONS ACTIVITIES | ||||
Net loss for the periods | $ (127,637) | $ (127,637) | $ (158,843) | $ 0 |
Adjusments for | ||||
Operating expenses contributed by shareholders | 126,843 | 158,923 | ||
Subtotal | (794) | 80 | ||
Non-Cash Items: | ||||
Change in amounts receivable | (12,659) | (72) | ||
Change in trade and other payables | 30,531 | 0 | ||
Net cash from (used in) discontinued operations | 17,078 | 17,078 | 8 | 0 |
Increase in cash | 17,078 | 8 | ||
Cash, beginning of the period | 8 | $ 8 | 0 | |
Cash, end of the period | 17,086 | 8 | $ 0 | |
Cash invested in Securter Systems Inc. | (128,815) | (158,923) | ||
Unspent cash balance in Securter Systems Inc. | 0 | 8 | ||
Securter Systems Inc.'s cash disposed on deconsolidation | (17,086) | 0 | ||
Net cash (used in) investment in discontinued operations | $ (145,901) | $ (158,915) |
PREPAID EXPENSES (Details)
PREPAID EXPENSES (Details) | Dec. 31, 2019CAD ($) |
DisclosureOfPrepaidExpensesLineItems [Line Items] | |
Prepaid expenses | $ 0 |
Market Registration Fees | |
DisclosureOfPrepaidExpensesLineItems [Line Items] | |
Prepaid expenses | 0 |
Legal Retainer | |
DisclosureOfPrepaidExpensesLineItems [Line Items] | |
Prepaid expenses | $ 0 |
TRADE AND OTHER PAYABLES (Detai
TRADE AND OTHER PAYABLES (Details) - CAD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
Trade and other payables [abstract] | ||
Trade payables | $ 73,447 | $ 32,276 |
Accrued liabilities | 74,150 | 90,000 |
Trade and other payables | $ 147,597 | $ 122,276 |
CONVERTIBLE PROMISSORY NOTES (D
CONVERTIBLE PROMISSORY NOTES (Details) - CAD ($) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
DisclosureOfConvertiblePromissoryNotesLineItems [Line Items] | |||
Convertible promissory notes, beginning | $ 435,634 | $ 16,843 | |
Proceeds net of transaction costs | 403,600 | 572,389 | |
Repayments | 0 | (33,596) | |
Conversions | (1,416,024) | (1,379,907) | |
Fair value change | 1,995,930 | 1,067,076 | $ (534,118) |
Interest expense | 30,785 | 58,470 | |
Accretion expense | 137,880 | 146,624 | 7,039 |
Loss (gain) on settlement of debt | (151,301) | 0 | |
Foreign exchange (gain) loss | (2,659) | (12,265) | |
Convertible promissory notes, ending | 1,433,845 | 435,634 | 16,843 |
Promissory Note | |||
DisclosureOfConvertiblePromissoryNotesLineItems [Line Items] | |||
Convertible promissory notes, beginning | 165,698 | 209,755 | |
Proceeds net of transaction costs | 0 | 0 | |
Repayments | 0 | (33,596) | |
Conversions | 0 | 0 | |
Fair value change | 0 | 0 | |
Interest expense | 0 | 0 | |
Accretion expense | 0 | 0 | |
Loss (gain) on settlement of debt | (151,301) | ||
Foreign exchange (gain) loss | (2,494) | (10,461) | |
Convertible promissory notes, ending | 11,903 | 165,698 | 209,755 |
Convertible Promissory Note - Liability Component | |||
DisclosureOfConvertiblePromissoryNotesLineItems [Line Items] | |||
Convertible promissory notes, beginning | 50,593 | 25,541 | |
Proceeds net of transaction costs | 13,396 | 13,328 | |
Repayments | 0 | 0 | |
Conversions | (140,768) | (191,566) | |
Fair value change | 0 | 0 | |
Interest expense | 30,785 | 58,470 | |
Accretion expense | 137,880 | 146,624 | |
Loss (gain) on settlement of debt | 0 | ||
Foreign exchange (gain) loss | (165) | (1,804) | |
Convertible promissory notes, ending | 91,721 | 50,593 | 25,541 |
Derivative Liability | |||
DisclosureOfConvertiblePromissoryNotesLineItems [Line Items] | |||
Convertible promissory notes, beginning | 370,194 | 733,339 | |
Proceeds net of transaction costs | 1,216,301 | 1,517,944 | |
Repayments | 0 | 0 | |
Conversions | (1,104,262) | (1,545,331) | |
Fair value change | 1,128,625 | (335,758) | |
Interest expense | 0 | 0 | |
Accretion expense | 0 | 0 | |
Loss (gain) on settlement of debt | 0 | ||
Foreign exchange (gain) loss | 0 | 0 | |
Convertible promissory notes, ending | 1,610,858 | 370,194 | 733,339 |
Deferred Derivative Loss (Increase) | |||
DisclosureOfConvertiblePromissoryNotesLineItems [Line Items] | |||
Convertible promissory notes, beginning | (150,851) | (951,792) | |
Proceeds net of transaction costs | (826,097) | (958,883) | |
Repayments | 0 | 0 | |
Conversions | (170,994) | 356,990 | |
Fair value change | 867,305 | 1,402,834 | |
Interest expense | 0 | 0 | |
Accretion expense | 0 | 0 | |
Loss (gain) on settlement of debt | 0 | ||
Foreign exchange (gain) loss | 0 | 0 | |
Convertible promissory notes, ending | $ (280,637) | $ (150,851) | $ (951,792) |
SHARE CAPITAL (Details)
SHARE CAPITAL (Details) | 12 Months Ended |
Dec. 31, 2020shares$ / shares | |
Share Capital Abstract | |
Exercise price | $ / shares | $ .006 |
Stock options outstanding, beginning | 0 |
Granted | 10,000,000 |
Exercised | 0 |
Cancelled | 0 |
Stock options outstanding, ending | 10,000,000 |
SUPPLEMENTAL CASH FLOW INFORM_3
SUPPLEMENTAL CASH FLOW INFORMATION (Details) - CAD ($) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Change in Non-Cash Working Capital Accounts | |||
Accounts receivable | $ 0 | $ 0 | $ 297,308 |
GST recoverable | 1,540 | (2,469) | (2,128) |
Prepaid expenses | 0 | 0 | (18,608) |
Trade and other payables | 25,320 | (7,003) | 125,564 |
Liabilities to customers | 0 | 0 | (297,309) |
Total | 26,860 | (9,472) | 104,827 |
Significant Non-Cash Financing Activities | |||
Shares issued for services | 0 | 0 | 7,373 |
Shares issued on conversion of convertible promissory notes | 1,416,023 | 1,379,907 | 1,934,419 |
Total | 1,416,023 | 1,379,907 | 1,941,792 |
Other Information | |||
Interest paid | 31,621 | 59,138 | 186,128 |
Income taxes paid | $ 0 | $ 0 | $ 0 |
INCOME TAX (Details)
INCOME TAX (Details) - CAD ($) | Dec. 31, 2033 | Dec. 31, 2032 | Dec. 31, 2031 | Dec. 31, 2030 | Dec. 31, 2029 | Dec. 31, 2028 | Dec. 31, 2027 | Dec. 31, 2026 | Dec. 31, 2020 | Dec. 31, 2019 |
Income Tax | ||||||||||
Non-capital loss | $ 4,148,200 | $ 233,000 | $ 301,400 | $ 307,400 | $ 1,157,900 | $ 367,400 | $ 515,300 | $ 313,100 | $ 7,343,700 | $ 7,052,500 |
Capital losses | 29,629 | 29,628 | ||||||||
Property and equipment | 100,490 | 100,490 | ||||||||
Unrecognized deductible temporary differences | $ 7,473,847 | $ 7,182,618 |
INCOME TAX (Details 1)
INCOME TAX (Details 1) - CAD ($) | Dec. 31, 2033 | Dec. 31, 2032 | Dec. 31, 2031 | Dec. 31, 2030 | Dec. 31, 2029 | Dec. 31, 2028 | Dec. 31, 2027 | Dec. 31, 2026 | Dec. 31, 2020 | Dec. 31, 2019 |
Income Tax | ||||||||||
Non-capital loss | $ 4,148,200 | $ 233,000 | $ 301,400 | $ 307,400 | $ 1,157,900 | $ 367,400 | $ 515,300 | $ 313,100 | $ 7,343,700 | $ 7,052,500 |
INCOME TAX (Details 2)
INCOME TAX (Details 2) - CAD ($) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Income Tax | |||
Recovery of income tax calculated at the statutory rate of 12% (2018 - 12%; 2017 - 12.63%) | $ (298,306) | $ (289,340) | $ (62,756) |
Deferred tax assets not recognized | (39,649) | 289,340 | 36,948 |
Impact of change in substantively enacted tax rates on opening deferred tax assets | 71,680 | 0 | 25,808 |
Other permanent differences | 266,275 | 0 | 0 |
Income tax expense | $ 0 | $ 0 | $ 0 |
RELATED PARTIES TRANSACTIONS (D
RELATED PARTIES TRANSACTIONS (Details) - CAD ($) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Related party transactions [abstract] | |||
Management fees | $ 133,939 | $ 244,120 | $ 241,950 |
RELATED PARTIES TRANSACTIONS _2
RELATED PARTIES TRANSACTIONS (Details Narrative) - CAD ($) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Disclosure of transactions between related parties [line items] | |||
Stock option expense | $ 0 | $ 60,000 | $ 0 |
Consulting fees for services | 145,396 | 376,100 | $ 294,502 |
Former Director | |||
Disclosure of transactions between related parties [line items] | |||
Stock option expense | 0 | 34,500 | |
Consulting fees for services | $ 0 | $ 19,125 |
FINANCIAL RISK MANAGEMENT OBJ_2
FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES (Details Narrative) | Dec. 31, 2020CAD ($) |
Financial Risk Management Objectives And Policies | |
Working capital deficiency | $ (238,702) |
CAPITAL MANAGEMENT (Details Nar
CAPITAL MANAGEMENT (Details Narrative) - CAD ($) | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
Capital Management | |||
Share capital | $ 8,876,281 | $ 7,460,158 | $ 6,080,151 |
Working capital deficiency | $ (238,702) |