Document And Entity Information
Document And Entity Information - USD ($) | 12 Months Ended | ||
Mar. 31, 2018 | Jan. 06, 2020 | Sep. 29, 2017 | |
Document Information Line Items | |||
Entity Registrant Name | LegacyXChange, Inc. | ||
Document Type | 10-K | ||
Current Fiscal Year End Date | --03-31 | ||
Entity Common Stock, Shares Outstanding | 62,570,659 | ||
Entity Public Float | $ 76,113 | ||
Amendment Flag | false | ||
Entity Central Index Key | 0001423579 | ||
Entity Current Reporting Status | No | ||
Entity Voluntary Filers | No | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Well-known Seasoned Issuer | No | ||
Document Period End Date | Mar. 31, 2018 | ||
Document Fiscal Year Focus | 2018 | ||
Document Fiscal Period Focus | FY | ||
Entity Small Business | true | ||
Entity Emerging Growth Company | false | ||
Entity Shell Company | true | ||
Entity File Number | 333-201811 | ||
Entity Incorporation, State or Country Code | NV | ||
Entity Interactive Data Current | No |
Balance Sheets
Balance Sheets - USD ($) | Mar. 31, 2018 | Mar. 31, 2017 |
ASSETS | ||
TOTAL ASSETS | ||
CURRENT LIABILITIES: | ||
Accounts payable | 137,278 | 133,853 |
Accrued liabilities | 429,361 | 291,027 |
Loans payable | 143,924 | 143,924 |
Convertible notes, net of debt discount | 459,091 | 373,734 |
Derivative liabilities | 5,474 | 80,165 |
Total Current Liabilities | 1,175,128 | 1,022,703 |
TOTAL LIABILITIES | 1,175,128 | 1,022,703 |
COMMITMENTS AND CONTINGENCIES | ||
STOCKHOLDERS’ DEFICIT: | ||
Preferred stock: $0.001 par value; 10,000,000 shares authorized; No share issued or outstanding at March 31, 2018 and 2017 | ||
Common stock: $0.001 par value; 190,000,000 shares authorized; 62,570,659 shares issued and outstanding at March 31, 2018 and 2017 | 62,571 | 62,571 |
Additional paid-in capital | 9,182,575 | 9,182,575 |
Accumulated deficit | (10,420,274) | (10,267,849) |
TOTAL STOCKHOLDERS’ DEFICIT | (1,175,128) | (1,022,703) |
TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT |
Balance Sheets (Parentheticals)
Balance Sheets (Parentheticals) - $ / shares | Mar. 31, 2018 | Mar. 31, 2017 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value (in Dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Preferred stock, shares issued | ||
Preferred stock, shares outstanding | ||
Common stock, par value (in Dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 190,000,000 | 190,000,000 |
Common stock, shares issued | 62,570,659 | 62,570,659 |
Common stock, shares outstanding | 62,570,659 | 62,570,659 |
Statements of Operations
Statements of Operations - USD ($) | 12 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Income Statement [Abstract] | ||
REVENUE, NET | ||
OPERATING EXPENSES | ||
Compensation and related taxes | 75,000 | 121,036 |
Professional and consulting fees | 2,550 | 80,290 |
Other selling, general and administrative | 875 | 11,734 |
TOTAL OPERATING EXPENSES | 78,425 | 213,060 |
LOSS FROM OPERATIONS | (78,425) | (213,060) |
OTHER INCOME (EXPENSE) | ||
Interest expense | (148,691) | (229,560) |
Gain from change in fair value of derivative liabilities | 74,691 | 720,808 |
TOTAL OTHER INCOME (EXPENSE), NET | (74,000) | 491,248 |
NET INCOME (LOSS) | $ (152,425) | $ 278,188 |
NET INCOME (LOSS) PER COMMON SHARE | ||
Basic (in Dollars per share) | $ 0 | $ 0 |
Diluted (in Dollars per share) | $ 0 | $ 0 |
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING: | ||
Basic (in Shares) | 62,570,659 | 62,570,659 |
Diluted (in Shares) | 62,570,659 | 121,066,143 |
Statement of Changes in Stockho
Statement of Changes in Stockholders’ Deficit - USD ($) | Preferred Stock | Common Stock | Additional Paid-in Capital | Accumulated Deficit | Total |
Balance at Mar. 31, 2016 | $ 62,571 | $ 9,182,575 | $ (10,546,037) | $ (1,300,891) | |
Balance (in Shares) at Mar. 31, 2016 | 62,570,659 | ||||
Net income/loss | 278,188 | 278,188 | |||
Balance at Mar. 31, 2017 | $ 62,571 | 9,182,575 | (10,267,849) | (1,022,703) | |
Balance (in Shares) at Mar. 31, 2017 | 62,570,659 | ||||
Net income/loss | (152,425) | (152,425) | |||
Balance at Mar. 31, 2018 | $ 62,571 | $ 9,182,575 | $ (10,420,274) | $ (1,175,128) | |
Balance (in Shares) at Mar. 31, 2018 | 62,570,659 |
Statements of Cash Flows
Statements of Cash Flows - USD ($) | 12 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
CASH FLOWS FROM OPERATING ACTIVITIES | ||
Net income (loss) | $ (152,425) | $ 278,188 |
Adjustments to reconcile income (loss) to net cash used in operating activities: | ||
Amortization of debt discount | 85,357 | 166,292 |
Gain from change in fair value of derivative liabilities | (74,691) | (720,808) |
Write-off of obsolete inventory | 570 | |
Amortization of prepaid consulting fees | 11,047 | |
Changes in operating assets and liabilities: | ||
Prepaid expenses and other current assets | 50,000 | |
Accounts payable | 3,425 | 28,477 |
Accrued liabilities | 138,334 | 170,870 |
Net cash used in operating activities | (15,364) | |
CASH FLOWS FROM FINANCING ACTIVITIES | ||
Proceeds from loan payable | 11,155 | |
Net cash provided by financing activities | 11,155 | |
Net decrease in cash | (4,209) | |
Cash - Beginning of year | 4,209 | |
Cash - End of the year | ||
Cash paid for: | ||
Interest | ||
Income taxes |
Organization and Nature of Oper
Organization and Nature of Operations | 12 Months Ended |
Mar. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
ORGANIZATION AND NATURE OF OPERATIONS | NOTE 1 – ORGANIZATION AND NATURE OF OPERATIONS LegacyXchange, Inc., formerly known as True 2 Beauty, Inc. (the “Company”) was originally incorporated as Burrow Mining, Inc., a Nevada corporation, on December 11, 2006. In February 2010, the Company shifted its focus to the beauty industry and later amended its Articles of Incorporation and changed its name to True 2 Beauty, Inc., to better reflect its new business focus. On July 10, 2012, the Company formed a new wholly owned subsidiary True2Bid, Inc. (“True2Bid”) which was incorporated in the state of Nevada. This subsidiary’s name was changed to LegacyXchange, Inc. (“LegacyXchange”) in December 2014. The Company continued to sell existing inventory of beauty products through May 2013 when the final inventory was sold. LegacyXchange operates an online e-commerce platform focused on delivering users a wide array of sports and entertainment related products that can be won in an action-packed environment of a live auction. On July 2, 2015, pursuant to a Certificate of Dissolution filing with the Nevada Secretary of State, the Company dissolved LegacyXchange (formerly True2Bid, Inc.) to allow for the change in name of its parent company, True 2 Beauty, Inc., to LegacyXchange, Inc. The Company is currently inactive due to lack of working capital to fund its operations. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Mar. 31, 2018 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The accompanying financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America (the “U.S. GAAP”). Going Concern The financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the settlement of liabilities and commitments in the normal course of business. As reflected in our accompanying financial statements, the Company had net loss of $152,425 for the year ended March 31, 2018. The Company had accumulated deficit, stockholders’ deficit and working capital deficit of $10,420,274, $1,175,128 and $1,175,128, respectively, at March 31, 2018. The Company had no revenues for the year ended March 31, 2018, and we defaulted on our loans and certain convertible notes. Management believes that these matters raise substantial doubt about the Company’s ability to continue as a going concern for twelve months from the issuance date of this report. Management cannot provide assurance that we will ultimately achieve profitable operations or become cash flow positive or raise additional debt and/or equity capital. Management believes that our capital resources are not currently adequate to continue operating and maintaining its business strategy for a period of twelve months from the issuance date of this report. The Company will seek to raise capital through additional debt and/or equity financings to fund its operations in the future. Although the Company has historically raised capital from sales of equity and from the issuance of promissory notes, there is no assurance that it will be able to continue to do so. If the Company is unable to raise additional capital or secure additional lending in the near future, management expects that the Company will need to curtail or cease operations. These financial statements do not include any adjustments related to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern. Use of Estimates The preparation of the financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from these estimates. Significant estimates during the years ended March 31, 2018 and 2017 include assumptions used in assessing estimates of deferred tax valuation allowances and the valuation of derivative liabilities. Fair Value of Financial Instruments and Fair Value Measurements FASB ASC 820 - Fair Value Measurements and Disclosures, defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. FASB ASC 820 requires disclosures about the fair value of all financial instruments, whether or not recognized, for financial statement purposes. Disclosures about the fair value of financial instruments are based on pertinent information available to the Company on March 31, 2018. Accordingly, the estimates presented in these financial statements are not necessarily indicative of the amounts that could be realized on disposition of the financial instruments. FASB ASC 820 specifies a hierarchy of valuation techniques based on whether the inputs to those valuation techniques are observable or unobservable. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect market assumptions. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurement) and the lowest priority to unobservable inputs (Level 3 measurement). The three levels of the fair value hierarchy are as follows: Level 1—Inputs are unadjusted quoted prices in active markets for identical assets or liabilities available at the measurement date. Level 2—Inputs are unadjusted quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, inputs other than quoted prices that are observable, and inputs derived from or corroborated by observable market data. Level 3—Inputs are unobservable inputs which reflect the reporting entity’s own assumptions on what assumptions the market participants would use in pricing the asset or liability based on the best available information. The carrying amounts reported in the balance sheets for cash, due from and to related parties, prepaid expenses, accounts payable and accrued liabilities approximate their fair market value based on the short-term maturity of these instruments. Assets or liabilities measured at fair value on a recurring basis included conversion options in convertible notes and warrants with their exercise price containing a down-round provision (see Note 5) were as follows at March 31, 2018 and 2017: At March 31, 2018 At March 31, 2017 Description Level 1 Level 2 Level 3 Level 1 Level 2 Level 3 Derivative liabilities — — $ 5,474 — — $ 80,165 A roll forward of the level 3 valuation financial instruments is as follows: For the Year Ended 2018 2017 Balance at beginning of year $ 80,165 $ 800,973 Gain from change in fair value of derivative liabilities (74,691 ) (720,808 ) Balance at end of year $ 5,474 $ 80,165 ASC 825-10 “Financial Instruments”, allows entities to voluntarily choose to measure certain financial assets and liabilities at fair value (fair value option). The fair value option may be elected on an instrument-by-instrument basis and is irrevocable, unless a new election date occurs. If the fair value option is elected for an instrument, unrealized gains and losses for that instrument should be reported in earnings at each subsequent reporting date. The Company did not elect to apply the fair value option to any outstanding financial instruments. Cash The Company maintains its cash in bank and financial institution deposits that at times may exceed federally insured limits. There were no balances in excess of FDIC insured levels as of March 31, 2018 and 2017. The Company has not experienced any losses in such accounts through March 31, 2018. Inventory Inventories are stated at the lower of cost or market value. Cost is determined using the cost to acquire inventory and is valued using the first-in, first-out method. During the year ended March 31, 2017, the Company determined that the inventory of $570 was impaired and was written off. As of March 31, 2018 and 2017, the Company did not have any inventory. Derivative Liabilities The Company has certain financial instruments that are embedded derivatives associated with capital raises and certain warrants. The Company evaluates all its financial instruments to determine if those contracts or any potential embedded components of those contracts qualify as derivatives to be separately accounted for in accordance with ASC 815-10 – Derivative and Hedging – Contract in Entity’s Own Equity In July 2017, FASB issued ASU No. 2017-11, Earnings Per Share (Topic 260); Distinguishing Liabilities from Equity (Topic 480); Derivatives and Hedging (Topic 815): (Part I) Accounting for Certain Financial Instruments with Down Round Features. These amendments simplify the accounting for certain financial instruments with down-round features. The amendments require companies to disregard the down-round feature when assessing whether the instrument is indexed to its own stock, for purposes of determining liability or equity classification. The adoption of this guidance is not expected to have a material impact on the Company’s financial statements. Revenue Recognition In May 2014, FASB issued an update Accounting Standards Update, ASU 2014-09, establishing ASC 606 - Revenue from Contracts with Customers. ASU 2014-09, as amended by subsequent ASUs on the topic, establishes a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most of the existing revenue recognition guidance. This standard, which is effective for interim and annual reporting periods in fiscal years that begin after December 15, 2017, requires an entity to recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services and also requires certain additional disclosures. adoption of this guidance is not expected to have a material impact on the process for, timing of, and presentation and disclosure of revenue recognition from customers. The Company adopted ASU 2014-09 during the three months ended March 31, 2018. The adoption of ASU 2014-09 did not have any material impact on the Company’s financial statements. The Company did not have revenues for the years ended March 31, 2018 and 2017. Stock-Based Compensation Stock-based compensation is accounted for based on the requirements of the Share-Based Payment Topic of ASC 718 which requires recognition in the financial statements of the cost of employee and director services received in exchange for an award of equity instruments over the period the employee or director is required to perform the services in exchange for the award (presumptively, the vesting period). The ASC also requires measurement of the cost of employee and director services received in exchange for an award based on the grant-date fair value of the award. In June 2014, the FASB issued Accounting Standards Update No. 2014-12, Compensation — Stock Compensation (Topic 718), Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period (a consensus of the FASB Emerging Issues Task Force) (ASU 2014-12). The guidance applies to all reporting entities that grant their employees share-based payments in which the terms of the award provide that a performance target that affects vesting could be achieved after the requisite service period. The amendments require that a performance target that affects vesting and that could be achieved after the requisite service period is treated as a performance condition. For all entities, the amendments in this Update are effective for annual periods and interim periods within those annual periods beginning after December 15, 2015. Earlier adoption is permitted. The effective date is the same for both public business entities and all other entities. The Company early adopted ASU 2014-12 during the period ending June 30, 2016. The adoption of ASU 2014-12 did not have any material impact on the Company’s financial statements. Pursuant to ASC 505-50 - Equity-Based Payments to Non-Employees, all share-based payments to non-employees, including grants of stock options, were recognized in the financial statements as compensation expense over the service period of the consulting arrangement or until performance conditions are expected to be met. Using a Black Scholes valuation model, the Company periodically reassessed the fair value of non-employee options until service conditions are met, which generally aligns with the vesting period of the options, and the Company adjusts the expense recognized in the financial statements accordingly. In June 2018, the FASB issued ASU 2018-07, Improvements to Nonemployee Share-Based Payment Accounting, which simplifies several aspects of the accounting for nonemployee share-based payment transactions by expanding the scope of the stock-based compensation guidance in ASC 718 to include share-based payment transactions for acquiring goods and services from non-employees. ASU 2018-07 is effective for annual periods beginning after December 15, 2018, including interim periods within those annual periods. Early adoption is permitted, but entities may not adopt prior to adopting the new revenue recognition guidance in ASC 606. The Company early adopted ASU 2018-07 during the three months ended March 31, 2018. The adoption of ASU 2018-07 did not have any material impact on the Company’s financial statements. Income Taxes The Company accounts for income tax using the liability method prescribed by ASC 740 - Income Taxes. Under this method, deferred tax assets and liabilities are determined based on the difference between the financial reporting and tax bases of assets and liabilities using enacted tax rates that will be in effect in the year in which the differences are expected to reverse. The Company records a valuation allowance to offset net deferred tax assets if based on the weight of available evidence, it is more-likely-than-not that some portion, or all, of the deferred tax assets will not be realized. The effect on deferred taxes of a change in tax rates is recognized as income or loss in the period that includes the enactment date. On December 22, 2017, the United States signed into law the Tax Cuts and Jobs Act (the “Act”), a tax reform bill which, among other items, reduces the current federal income tax rate to 21% from 34%. The rate reduction is effective January 1, 2018 and is permanent. The Act has caused the Company’s deferred income taxes to be revalued. As changes in tax laws or rates are enacted, deferred tax assets and liabilities are adjusted through income tax expense. Pursuant to the guidance within SEC Staff Accounting Bulletin No. 118 (“SAB 118”), as of March 31, 2018, the Company recognized the provisional effects of the enactment of the Act for which measurement could be reasonably estimated. Since the Company has provided a full valuation allowance against its deferred tax assets, the revaluation of the deferred tax assets did not have a material impact on any period presented. The ultimate impact of the Act may differ from these estimates due to the Company’s continued analysis or further regulatory guidance that may be issued as a result of the Act. The Company follows the accounting guidance for uncertainty in income taxes using the provisions of ASC 740 “Income Taxes Basic and Diluted Income (Loss) Per Share Pursuant to ASC 260-10-45, basic income (loss) per common share is computed by dividing net income (loss) by the weighted average number of shares of common stock outstanding for the periods presented. Diluted income (loss) per share is computed by dividing net income (loss) by the weighted average number of shares of common stock, common stock equivalents and potentially dilutive securities outstanding during the period. Potentially dilutive common shares consist of common stock issuable for stock options and warrants (using the treasury stock method), convertible notes and common stock issuable. These common stock equivalents may be dilutive in the future. The following potentially dilutive equity securities outstanding as of March 31, 2018 were not included in the computation of dilutive income (loss) per common share because the effect would have been anti-dilutive: March 31, 2018 2017 Stock warrants 5,273,315 5,273,315 Convertible notes 63,369,653 58,495,484 Total 68,642,968 63,768,799 The following is a reconciliation of the numerator and denominator used in the basic and diluted earnings per share calculations for the year ended March 31, 2017: March 31, 2017 Numerator: Net income $ 278,188 Add: Interest expense 229,560 Less: Gain from change in fair value of derivative liabilities (720,808 ) Adjusted net loss $ (213,060 ) Denominator: Weighted-average shares of common stock 62,570,659 Dilutive effect of convertible notes 58,495,484 Diluted weighted-average of common stock 121,066,143 Net income (loss) per common share: Basic $ 0.00 Diluted $ (0.00 ) Related Parties Parties are considered to be related to the Company if the parties, directly or indirectly, through one or more intermediaries, control, are controlled by, or are under common control with the Company. Related parties also include principal owners of the Company, its management, members of the immediate families of principal owners of the Company and its management and other parties with which the Company may deal with if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests. Recent Accounting Pronouncements In August 2018, the FASB issued ASU 2018-13 —Fair Value Measurement (Topic 820): Disclosure Framework Changes to the Disclosure Requirements for Fair Value Measurement Removals 1. The amount of and reasons for transfers between Level 1 and Level 2 of the fair value hierarchy 2. The policy for timing of transfers between levels 3. The valuation processes for Level 3 fair value measurements 4. For nonpublic entities, the changes in unrealized gains and losses for the period included in earnings for recurring Level 3 fair value measurements held at the end of the reporting period. Modifications 1. In lieu of a roll forward for Level 3 fair value measurements, a nonpublic entity is required to disclose transfers into and out of Level 3 of the fair value hierarchy and purchases and issues of Level 3 assets and liabilities. 2. For investments in certain entities that calculate net asset value, an entity is required to disclose the timing of liquidation of an investee’s assets and the date when restrictions from redemption might lapse only if the investee has communicated the timing to the entity or announced the timing publicly. 3. The amendments clarify that the measurement uncertainty disclosure is to communicate information about the uncertainty in measurement as of the reporting date. Additions 1. The changes in unrealized gains and losses for the period included in other comprehensive income for recurring Level 3 fair value measurements held at the end of the reporting period. 2. The range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements. For certain unobservable inputs, an entity may disclose other quantitative information (such as the median or arithmetic average) in lieu of the weighted average if the entity determines that other quantitative information would be a more reasonable and rational method to reflect the distribution of unobservable inputs used to develop Level 3 fair value measurements. In addition, the amendments eliminate at a minimum an entity shall disclose at a minimum Management does not believe that any other recently issued, but not yet effective accounting pronouncements, if adopted, would have a material effect on the Company’s financial statements. |
Accrued Liabilities
Accrued Liabilities | 12 Months Ended |
Mar. 31, 2018 | |
Payables and Accruals [Abstract] | |
ACCRUED LIABILITIES | NOTE 3 – ACCRUED LIABILITIES At March 31, 2018 and 2017, accrued liabilities consisted of the following: March 31, 2018 2017 Accrued interest $ 184,827 $ 121,493 Accrued professional fees 2,634 2,634 Accrued payroll taxes 29,727 29,727 Accrued executive and director compensation 212,173 137,173 Total $ 429,361 $ 291,027 |
Loans Payable
Loans Payable | 12 Months Ended |
Mar. 31, 2018 | |
Debt Disclosure [Abstract] | |
LOANS PAYABLE | NOTE 4 – LOANS PAYABLE Between July 2015 through March 2016, the Company entered into individual loan agreements with various investors in the aggregate principal amount of $132,769. These loans bear an interest rate of 10% and were due and payable on the first anniversary of the date of issuance of the loans. Between April and May 2016, the Company entered into individual loan agreements with various investors in the aggregate principal amount of $11,155. These loans bear an interest rate of 10% and were due and payable on the first anniversary of the date of issuance of the loans. As of March 31, 2018, these loans were in default and had outstanding principal and accrued interest of $143,924 and $31,871, respectively. As of March 31, 2017, these loans were in default and had outstanding principal and accrued interest of $143,924 and $17,278, respectively. During the years ended March 31, 2018 and 2017, the Company recorded interest expense of $14,593 and $14,527, respectively, on these loans. |
Convertible Notes Payable
Convertible Notes Payable | 12 Months Ended |
Mar. 31, 2018 | |
Convertible Notes Payable [Abstract] | |
CONVERTIBLE NOTES PAYABLE | NOTE 5 – CONVERTIBLE NOTES PAYABLE At March 31, 2018 and 2017, convertible notes consisted of the following: March 31, 2018 2017 Principal amount $ 480,740 $ 480,740 Less: unamortized debt discount (21,649 ) (107,006 ) Convertible notes payable, net $ 459,091 $ 373,734 Fiscal 2015 Financing In October and November 2014, the Company entered into a subscription agreement with various purchasers (the “Fiscal 2015 Agreements”) for the sale of the Company’s convertible notes. Pursuant to the Fiscal 2015 Agreements, the Company issued to these purchasers, convertible promissory notes (the “Fiscal 2015 Convertible Notes”) for an aggregate principal amount of $400,000 with the Company receiving proceeds equal to the principal amount. The Fiscal 2015 Convertible Notes bear an interest rate of 10% per year and were due and payable on the third anniversary of the date of issuance through October and November 2017. The purchasers are entitled, at their option, at any time after the issuance of the Fiscal 2015 Convertible Notes, to convert all or any lesser portion of the outstanding principal amount and accrued and unpaid interest into the Company’s common stock at a conversion price of $0.02 During the year ended March 31, 2016, the conversion price was ratcheted down to $0.01. During the year ended March 31, 2016, the purchasers converted $130,510 and $10,792 of outstanding principal and accrued interest, respectively, into 7,065,084 shares of the Company’s common stock. As of March 31, 2017, the Fiscal 2015 Convertible Notes had outstanding principal and accrued interest of $269,490 and $67,520, respectively. As of March 31, 2018, the Fiscal 2015 Convertible Notes were in default and had outstanding principal and accrued interest of $269,490 and $94,843, respectively. Fiscal 2016 Financing In May and June 2015, the Company entered into a subscription agreement with various purchasers (the “Fiscal 2016 Agreements I”) for the sale of the Company’s convertible notes and warrants. Pursuant to the Fiscal 2016 Agreements I, the Company issued to the purchasers for an aggregate subscription amount of $115,000: (i) convertible promissory notes in the aggregate principal amount of $115,000 (the “Fiscal 2016 Notes I”) and (ii) five-year warrants to purchase an aggregate of 2,300,000 (twenty warrants for each dollar of the principal amount) shares Company’s common stock at an exercise price of $0.07 (the “Fiscal 2016 Warrants I”). The Company received proceeds equal to the principal amount. The Fiscal 2016 Notes I bear an interest rate of 10% per year and were due and payable on the third anniversary of the date of issuance through May and June 2018. The purchasers are entitled, at their option, at any time after the issuance of the Fiscal 2016 Notes I, to convert all or any lesser portion of the outstanding principal amount and accrued and unpaid interest into the Company’s common stock at a conversion price of $0.05. The conversion price of the Fiscal 2016 Notes I shall be subject to adjustment for issuances of common stock at a purchase price of less than the then-effective conversion price. During the year ended March 31, 2016, the conversion price was ratcheted down to $0.01. As of March 31, 2017, the Fiscal 2016 Notes I had outstanding principal and accrued interest of $115,000 and $21,733, respectively. As of March 31, 2018, the Fiscal 2016 Notes I had outstanding principal and accrued interest of $115,000 and $33,393, respectively. During August through September 2015, the Company entered into a subscription agreement with various purchasers (the “Fiscal 2016 Agreements II”) for the sale of the Company’s convertible notes and warrants. Pursuant to the Fiscal 2016 Agreements II, the Company issued to the purchasers for an aggregate subscription amount of $96,250: (i) convertible promissory notes in the aggregate principal amount of $96,250 (the “Fiscal 2016 Notes II”) and (ii) five-year warrants to purchase an aggregate of 1,925,000 (twenty warrants for each dollar of the principal amount) shares Company’s common stock at an exercise price of $0.07 (the “Fiscal 2016 Warrants II”). The Company received proceeds equal to the principal amount. The Fiscal 2016 Notes II bear an interest rate of 10% per year and were due and payable on the third anniversary of the date of issuance through August through September 2018. The purchasers are entitled, at their option, at any time after the issuance of the Fiscal 2016 Notes II, to convert all or any lesser portion of the outstanding principal amount and accrued and unpaid interest into the Company’s common stock at a conversion price of $0.05. The conversion price of the Fiscal 2016 Notes II shall be subject to adjustment for issuances of common stock at a purchase price of less than the then-effective conversion price. During the year ended March 31, 2016, the conversion price was ratcheted down to $0.01. As of March 31, 2017, the Fiscal 2016 Notes II had outstanding principal and accrued interest of $96,250 and $14,962, respectively. As of March 31, 2018, the Fiscal 2016 Notes II had outstanding principal and accrued interest of $96,250 and $24,720, respectively. During the year ended March 31, 2018 and 2017, the Company recorded interest expense of $48,741 and $48,741, respectively, on these convertible notes. Derivative Liabilities Pursuant to Notes and Warrants In connection with the issuance of the Notes and Warrants, the Company determined that the terms of the Notes and Warrants contain terms that included a down-round provision under which the conversion price and exercise price could be affected by future equity offerings undertaken by the Company or contain terms that are not fixed monetary amounts at inception and included various other terms such as default provisions that caused derivative treatment. Accordingly, under the provisions of ASC 815-40 – Derivatives and Hedging – Contracts in an Entity’s Own Stock In July 2017, FASB issued ASU No. 2017-11, Earnings Per Share (Topic 260); Distinguishing Liabilities from Equity (Topic 480); Derivatives and Hedging (Topic 815): (Part I) Accounting for Certain Financial Instruments with Down Round Features. These amendments simplify the accounting for certain financial instruments with down-round features. The amendments require companies to disregard the down-round feature when assessing whether the instrument is indexed to its own stock, for purposes of determining liability or equity classification. The Company is currently evaluating the impact of ASU No. 2017-11 on its financial statements. At March 31, 2018 and 2017, the Company revalued the conversion option and warrant derivative liabilities. In connection with these revaluations, the Company recorded gain from change on fair value of derivative liabilities of $74,691 and $720,808 for the years ended March 31, 2018 and 2017, respectively. At March 31, 2018 and 2017, the fair value of the derivative liabilities was estimated using the Binomial option-pricing model with the following assumptions: 2018 2017 Dividend rate —% —% Term (in years) 0.1 to 2.8 years 1.8 to 3.0 years Volatility 290% to 305 % 282% to 293 % Risk—free interest rate 2.09% to 2.56% 1.27% to 1.93% For the years ended March 31, 2018 and 2017, amortization of debt discounts related to the convertible notes amounted to $85,357 and $166,292, respectively, which has been included in interest expense on the accompanying statements of operations. |
Stockholders' Deficit
Stockholders' Deficit | 12 Months Ended |
Mar. 31, 2018 | |
Stockholders' Equity Note [Abstract] | |
STOCKHOLDERS' DEFICIT | NOTE 6 – STOCKHOLDERS’ DEFICIT Authorized shares The Company is authorized to issue 200,000,000 consisting of 190,000,000 shares of common stock at $0.001 per share par value, and 10,000,000 shares of preferred stock at $0.001 per share par value. Preferred Stock As of March 31, 2018 and 2017, the Company did not have any preferred stock issued and outstanding. Common Stock As of March 31, 2018 and 2017, the Company had 62,570,659 shares of common stock issued and outstanding. Warrants Warrants issued pursuant to equity subscription agreements During fiscal years 2013 to 2015, in connection with the sale of common stock, the Company issued an aggregate of 1,048,315 five-year warrants to purchase common shares for an exercise price of $0.40 per common share to investors pursuant to unit subscription agreements. These warrants were accounted for as equity. As of March 31, 2017, 1,048,315 warrants were issued and outstanding. During the year ended March 31, 2018, 718,608 of warrants expired. As of March 31, 2018, 329,707 warrants were issued and outstanding. Warrants issued in connection with the Fiscal 2016 Financing During fiscal years 2016, pursuant to the convertible note agreements under the fiscal 2016 financing discussed in Note 5, the Company issued five-year warrants to purchase an aggregate of 4,225,000 (twenty warrants for each dollar of the principal amount) shares of the Company’s common stock at an exercise price of $0.07. The exercise price of these warrants shall be subject to adjustment for issuances of common stock at a purchase price of less than the then-effective conversion price and were accounted for as derivative liabilities. During the year ended March 31, 2016, the conversion price was ratcheted down to $0.01. As of March 31, 2018 and 2017, 4,225,000 warrants were issued and outstanding. Warrant activity for the years ended March 31, 2018 and 2017 are summarized as follows Number of Weighted Weighted Aggregate Balance Outstanding at March 31, 2016 5,273,315 $ 0.09 3.9 — Granted/Cancelled/Expired — — — — Balance Outstanding at March 31, 2017 5,273,315 0.09 2.9 — Expired (718,608 ) 0.40 — Balance Outstanding at March 31, 2018 4,554,707 $ 0.04 2.2 $ — Exercisable at March 31, 2018 4,554,707 $ 0.04 2.2 $ — |
Income Taxes
Income Taxes | 12 Months Ended |
Mar. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | NOTE 7 – INCOME TAXES The Company maintains deferred tax assets and liabilities that reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. The deferred tax assets at March 31, 2018 and 2017 consist of net operating loss carryforwards. The net deferred tax asset has been fully offset by a valuation allowance because of the uncertainty of the attainment of future taxable income. On December 22, 2017, the United States signed into law the Tax Cuts and Jobs Act (the “Act”), a tax reform bill which, among other items, reduces the current federal income tax rate to 21% from 34%. The rate reduction is effective January 1, 2018 and is permanent. The Act has caused the Company’s deferred income taxes to be revalued. As changes in tax laws or rates are enacted, deferred tax assets and liabilities are adjusted through income tax expense. Pursuant to the guidance within SEC Staff Accounting Bulletin No. 118 (“SAB 118”), as of March 31, 2018, the Company recognized the provisional effects of the enactment of the Act for which measurement could be reasonably estimated. Since the Company has provided a full valuation allowance against its deferred tax assets, the revaluation of the deferred tax assets did not have a material impact on any period presented. The ultimate impact of the Act may differ from these estimates due to the Company’s continued analysis or further regulatory guidance that may be issued as a result of the Act. The items accounting for the difference between income taxes at the effective statutory rate and the provision for income taxes for the years ended March 31, 2018 and 2017 were as follows: Years Ended 2018 2017 Income tax expense (benefit) at U.S. statutory rate of 34% $ (51,825 ) $ 94,584 Income tax benefit - State (7,621 ) 13,909 Non-deductible expenses (income) 4,160 (216,261 ) Effect of change in U.S. effective rate to 21% 18,429 — Change in valuation allowance 36,857 (107,768 ) Total provision for income tax $ — $ — The Company’s approximate net deferred tax asset at March 31, 2018 and 2017 was as follows: Years Ended Deferred Tax Asset: 2018 2017 Net operating losses $ 1,004,394 $ 1,451,305 Valuation allowance (1,004,394 ) (1,451,305 ) Net deferred tax asset $ — $ — The net operating loss carryforward was $3,863,055 and $3,721,296 at March 31, 2018 and 2017, respectively. The Company provided a valuation allowance equal to the deferred income tax asset for the years ended March 31, 2018 and 2017 because it was not known whether future taxable income will be sufficient to utilize the loss carryforward. The change in the allowance was $36,857 and $(107,768) for the years ended March 31, 2018 and 2017, respectively. As a result of the reduction of the federal corporate income tax rate the Company reduced the cumulative value of its deferred tax asset by $483,768 which was recorded as a corresponding reduction to the valuation allowance during the year ended March 31, 2018. These net operating loss carryforwards may be available to reduce future years’ taxable income. The potential tax benefit arising from the loss carryforward of $967,537 will expire through 2037. The potential tax benefit arising from the net operating loss carryforward of $36,857 from the period following to the Act’s effective date can be carried forward indefinitely within the annual usage limitations. Additionally, the future utilization of the net operating loss carryforward to offset future taxable income may be subject to an annual limitation as a result of ownership changes that could occur in the future. If necessary, the deferred tax assets will be reduced by any carryforward that expires prior to utilization as a result of such limitations, with a corresponding reduction of the valuation allowance. The Company does not have any uncertain tax positions or events leading to uncertainty in a tax position. The Company’s 2018, 2017 and 2016 Corporate Income Tax Returns are subject to Internal Revenue Service examination. |
Subsequent Events
Subsequent Events | 12 Months Ended |
Mar. 31, 2018 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | NOTE 8 – SUBSEQUENT EVENTS Between May 2018 and September 2018, the Fiscal 2016 Convertible Notes I and II defaulted due to non-payment at maturity date (see Note 5). Between November 2019 through June 2020, the Company entered into loan agreements with an investor in the aggregate principal amount of $91,000. The loans bear interest rate of 6% and were due and payable two-years from the date of issuances. |
Accounting Policies, by Policy
Accounting Policies, by Policy (Policies) | 12 Months Ended |
Mar. 31, 2018 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America (the “U.S. GAAP”). |
Going Concern | Going Concern The financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the settlement of liabilities and commitments in the normal course of business. As reflected in our accompanying financial statements, the Company had net loss of $152,425 for the year ended March 31, 2018. The Company had accumulated deficit, stockholders’ deficit and working capital deficit of $10,420,274, $1,175,128 and $1,175,128, respectively, at March 31, 2018. The Company had no revenues for the year ended March 31, 2018, and we defaulted on our loans and certain convertible notes. Management believes that these matters raise substantial doubt about the Company’s ability to continue as a going concern for twelve months from the issuance date of this report. Management cannot provide assurance that we will ultimately achieve profitable operations or become cash flow positive or raise additional debt and/or equity capital. Management believes that our capital resources are not currently adequate to continue operating and maintaining its business strategy for a period of twelve months from the issuance date of this report. The Company will seek to raise capital through additional debt and/or equity financings to fund its operations in the future. Although the Company has historically raised capital from sales of equity and from the issuance of promissory notes, there is no assurance that it will be able to continue to do so. If the Company is unable to raise additional capital or secure additional lending in the near future, management expects that the Company will need to curtail or cease operations. These financial statements do not include any adjustments related to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern. |
Use of Estimates | Use of Estimates The preparation of the financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from these estimates. Significant estimates during the years ended March 31, 2018 and 2017 include assumptions used in assessing estimates of deferred tax valuation allowances and the valuation of derivative liabilities. |
Fair Value of Financial Instruments and Fair Value Measurements | Fair Value of Financial Instruments and Fair Value Measurements FASB ASC 820 - Fair Value Measurements and Disclosures, defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. FASB ASC 820 requires disclosures about the fair value of all financial instruments, whether or not recognized, for financial statement purposes. Disclosures about the fair value of financial instruments are based on pertinent information available to the Company on March 31, 2018. Accordingly, the estimates presented in these financial statements are not necessarily indicative of the amounts that could be realized on disposition of the financial instruments. FASB ASC 820 specifies a hierarchy of valuation techniques based on whether the inputs to those valuation techniques are observable or unobservable. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect market assumptions. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurement) and the lowest priority to unobservable inputs (Level 3 measurement). The three levels of the fair value hierarchy are as follows: Level 1—Inputs are unadjusted quoted prices in active markets for identical assets or liabilities available at the measurement date. Level 2—Inputs are unadjusted quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, inputs other than quoted prices that are observable, and inputs derived from or corroborated by observable market data. Level 3—Inputs are unobservable inputs which reflect the reporting entity’s own assumptions on what assumptions the market participants would use in pricing the asset or liability based on the best available information. The carrying amounts reported in the balance sheets for cash, due from and to related parties, prepaid expenses, accounts payable and accrued liabilities approximate their fair market value based on the short-term maturity of these instruments. Assets or liabilities measured at fair value on a recurring basis included conversion options in convertible notes and warrants with their exercise price containing a down-round provision (see Note 5) were as follows at March 31, 2018 and 2017: At March 31, 2018 At March 31, 2017 Description Level 1 Level 2 Level 3 Level 1 Level 2 Level 3 Derivative liabilities — — $ 5,474 — — $ 80,165 A roll forward of the level 3 valuation financial instruments is as follows: For the Year Ended 2018 2017 Balance at beginning of year $ 80,165 $ 800,973 Gain from change in fair value of derivative liabilities (74,691 ) (720,808 ) Balance at end of year $ 5,474 $ 80,165 ASC 825-10 “Financial Instruments”, allows entities to voluntarily choose to measure certain financial assets and liabilities at fair value (fair value option). The fair value option may be elected on an instrument-by-instrument basis and is irrevocable, unless a new election date occurs. If the fair value option is elected for an instrument, unrealized gains and losses for that instrument should be reported in earnings at each subsequent reporting date. The Company did not elect to apply the fair value option to any outstanding financial instruments. |
Cash | Cash The Company maintains its cash in bank and financial institution deposits that at times may exceed federally insured limits. There were no balances in excess of FDIC insured levels as of March 31, 2018 and 2017. The Company has not experienced any losses in such accounts through March 31, 2018. |
Inventory | Inventory Inventories are stated at the lower of cost or market value. Cost is determined using the cost to acquire inventory and is valued using the first-in, first-out method. During the year ended March 31, 2017, the Company determined that the inventory of $570 was impaired and was written off. As of March 31, 2018 and 2017, the Company did not have any inventory. |
Derivative Liabilities | Derivative Liabilities The Company has certain financial instruments that are embedded derivatives associated with capital raises and certain warrants. The Company evaluates all its financial instruments to determine if those contracts or any potential embedded components of those contracts qualify as derivatives to be separately accounted for in accordance with ASC 815-10 – Derivative and Hedging – Contract in Entity’s Own Equity In July 2017, FASB issued ASU No. 2017-11, Earnings Per Share (Topic 260); Distinguishing Liabilities from Equity (Topic 480); Derivatives and Hedging (Topic 815): (Part I) Accounting for Certain Financial Instruments with Down Round Features. These amendments simplify the accounting for certain financial instruments with down-round features. The amendments require companies to disregard the down-round feature when assessing whether the instrument is indexed to its own stock, for purposes of determining liability or equity classification. The adoption of this guidance is not expected to have a material impact on the Company’s financial statements. |
Revenue Recognition | Revenue Recognition In May 2014, FASB issued an update Accounting Standards Update, ASU 2014-09, establishing ASC 606 - Revenue from Contracts with Customers. ASU 2014-09, as amended by subsequent ASUs on the topic, establishes a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most of the existing revenue recognition guidance. This standard, which is effective for interim and annual reporting periods in fiscal years that begin after December 15, 2017, requires an entity to recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services and also requires certain additional disclosures. adoption of this guidance is not expected to have a material impact on the process for, timing of, and presentation and disclosure of revenue recognition from customers. The Company adopted ASU 2014-09 during the three months ended March 31, 2018. The adoption of ASU 2014-09 did not have any material impact on the Company’s financial statements. The Company did not have revenues for the years ended March 31, 2018 and 2017. |
Stock-Based Compensation | Stock-Based Compensation Stock-based compensation is accounted for based on the requirements of the Share-Based Payment Topic of ASC 718 which requires recognition in the financial statements of the cost of employee and director services received in exchange for an award of equity instruments over the period the employee or director is required to perform the services in exchange for the award (presumptively, the vesting period). The ASC also requires measurement of the cost of employee and director services received in exchange for an award based on the grant-date fair value of the award. In June 2014, the FASB issued Accounting Standards Update No. 2014-12, Compensation — Stock Compensation (Topic 718), Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period (a consensus of the FASB Emerging Issues Task Force) (ASU 2014-12). The guidance applies to all reporting entities that grant their employees share-based payments in which the terms of the award provide that a performance target that affects vesting could be achieved after the requisite service period. The amendments require that a performance target that affects vesting and that could be achieved after the requisite service period is treated as a performance condition. For all entities, the amendments in this Update are effective for annual periods and interim periods within those annual periods beginning after December 15, 2015. Earlier adoption is permitted. The effective date is the same for both public business entities and all other entities. The Company early adopted ASU 2014-12 during the period ending June 30, 2016. The adoption of ASU 2014-12 did not have any material impact on the Company’s financial statements. Pursuant to ASC 505-50 - Equity-Based Payments to Non-Employees, all share-based payments to non-employees, including grants of stock options, were recognized in the financial statements as compensation expense over the service period of the consulting arrangement or until performance conditions are expected to be met. Using a Black Scholes valuation model, the Company periodically reassessed the fair value of non-employee options until service conditions are met, which generally aligns with the vesting period of the options, and the Company adjusts the expense recognized in the financial statements accordingly. In June 2018, the FASB issued ASU 2018-07, Improvements to Nonemployee Share-Based Payment Accounting, which simplifies several aspects of the accounting for nonemployee share-based payment transactions by expanding the scope of the stock-based compensation guidance in ASC 718 to include share-based payment transactions for acquiring goods and services from non-employees. ASU 2018-07 is effective for annual periods beginning after December 15, 2018, including interim periods within those annual periods. Early adoption is permitted, but entities may not adopt prior to adopting the new revenue recognition guidance in ASC 606. The Company early adopted ASU 2018-07 during the three months ended March 31, 2018. The adoption of ASU 2018-07 did not have any material impact on the Company’s financial statements. |
Income Taxes | Income Taxes The Company accounts for income tax using the liability method prescribed by ASC 740 - Income Taxes. Under this method, deferred tax assets and liabilities are determined based on the difference between the financial reporting and tax bases of assets and liabilities using enacted tax rates that will be in effect in the year in which the differences are expected to reverse. The Company records a valuation allowance to offset net deferred tax assets if based on the weight of available evidence, it is more-likely-than-not that some portion, or all, of the deferred tax assets will not be realized. The effect on deferred taxes of a change in tax rates is recognized as income or loss in the period that includes the enactment date. On December 22, 2017, the United States signed into law the Tax Cuts and Jobs Act (the “Act”), a tax reform bill which, among other items, reduces the current federal income tax rate to 21% from 34%. The rate reduction is effective January 1, 2018 and is permanent. The Act has caused the Company’s deferred income taxes to be revalued. As changes in tax laws or rates are enacted, deferred tax assets and liabilities are adjusted through income tax expense. Pursuant to the guidance within SEC Staff Accounting Bulletin No. 118 (“SAB 118”), as of March 31, 2018, the Company recognized the provisional effects of the enactment of the Act for which measurement could be reasonably estimated. Since the Company has provided a full valuation allowance against its deferred tax assets, the revaluation of the deferred tax assets did not have a material impact on any period presented. The ultimate impact of the Act may differ from these estimates due to the Company’s continued analysis or further regulatory guidance that may be issued as a result of the Act. The Company follows the accounting guidance for uncertainty in income taxes using the provisions of ASC 740 “Income Taxes |
Basic and Diluted Income (Loss) Per Share | Basic and Diluted Income (Loss) Per Share Pursuant to ASC 260-10-45, basic income (loss) per common share is computed by dividing net income (loss) by the weighted average number of shares of common stock outstanding for the periods presented. Diluted income (loss) per share is computed by dividing net income (loss) by the weighted average number of shares of common stock, common stock equivalents and potentially dilutive securities outstanding during the period. Potentially dilutive common shares consist of common stock issuable for stock options and warrants (using the treasury stock method), convertible notes and common stock issuable. These common stock equivalents may be dilutive in the future. The following potentially dilutive equity securities outstanding as of March 31, 2018 were not included in the computation of dilutive income (loss) per common share because the effect would have been anti-dilutive: March 31, 2018 2017 Stock warrants 5,273,315 5,273,315 Convertible notes 63,369,653 58,495,484 Total 68,642,968 63,768,799 The following is a reconciliation of the numerator and denominator used in the basic and diluted earnings per share calculations for the year ended March 31, 2017: March 31, 2017 Numerator: Net income $ 278,188 Add: Interest expense 229,560 Less: Gain from change in fair value of derivative liabilities (720,808 ) Adjusted net loss $ (213,060 ) Denominator: Weighted-average shares of common stock 62,570,659 Dilutive effect of convertible notes 58,495,484 Diluted weighted-average of common stock 121,066,143 Net income (loss) per common share: Basic $ 0.00 Diluted $ (0.00 ) |
Related Parties | Related Parties Parties are considered to be related to the Company if the parties, directly or indirectly, through one or more intermediaries, control, are controlled by, or are under common control with the Company. Related parties also include principal owners of the Company, its management, members of the immediate families of principal owners of the Company and its management and other parties with which the Company may deal with if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In August 2018, the FASB issued ASU 2018-13 —Fair Value Measurement (Topic 820): Disclosure Framework Changes to the Disclosure Requirements for Fair Value Measurement Removals 1. The amount of and reasons for transfers between Level 1 and Level 2 of the fair value hierarchy 2. The policy for timing of transfers between levels 3. The valuation processes for Level 3 fair value measurements 4. For nonpublic entities, the changes in unrealized gains and losses for the period included in earnings for recurring Level 3 fair value measurements held at the end of the reporting period. Modifications 1. In lieu of a roll forward for Level 3 fair value measurements, a nonpublic entity is required to disclose transfers into and out of Level 3 of the fair value hierarchy and purchases and issues of Level 3 assets and liabilities. 2. For investments in certain entities that calculate net asset value, an entity is required to disclose the timing of liquidation of an investee’s assets and the date when restrictions from redemption might lapse only if the investee has communicated the timing to the entity or announced the timing publicly. 3. The amendments clarify that the measurement uncertainty disclosure is to communicate information about the uncertainty in measurement as of the reporting date. Additions 1. The changes in unrealized gains and losses for the period included in other comprehensive income for recurring Level 3 fair value measurements held at the end of the reporting period. 2. The range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements. For certain unobservable inputs, an entity may disclose other quantitative information (such as the median or arithmetic average) in lieu of the weighted average if the entity determines that other quantitative information would be a more reasonable and rational method to reflect the distribution of unobservable inputs used to develop Level 3 fair value measurements. In addition, the amendments eliminate at a minimum an entity shall disclose at a minimum Management does not believe that any other recently issued, but not yet effective accounting pronouncements, if adopted, would have a material effect on the Company’s financial statements. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Mar. 31, 2018 | |
Accounting Policies [Abstract] | |
Schedule of financial assets and liabilities categorized as Level 3 | At March 31, 2018 At March 31, 2017 Description Level 1 Level 2 Level 3 Level 1 Level 2 Level 3 Derivative liabilities — — $ 5,474 — — $ 80,165 |
Schedule of financial instruments | For the Year Ended 2018 2017 Balance at beginning of year $ 80,165 $ 800,973 Gain from change in fair value of derivative liabilities (74,691 ) (720,808 ) Balance at end of year $ 5,474 $ 80,165 |
Schedule of antidilutive securities excluded from the computation of dilutive income (loss) per common share | March 31, 2018 2017 Stock warrants 5,273,315 5,273,315 Convertible notes 63,369,653 58,495,484 Total 68,642,968 63,768,799 |
Schedule of reconciliation of the numerator and denominator used in the basic and diluted earnings per share | March 31, 2017 Numerator: Net income $ 278,188 Add: Interest expense 229,560 Less: Gain from change in fair value of derivative liabilities (720,808 ) Adjusted net loss $ (213,060 ) Denominator: Weighted-average shares of common stock 62,570,659 Dilutive effect of convertible notes 58,495,484 Diluted weighted-average of common stock 121,066,143 Net income (loss) per common share: Basic $ 0.00 Diluted $ (0.00 ) |
Accrued Liabilities (Tables)
Accrued Liabilities (Tables) | 12 Months Ended |
Mar. 31, 2018 | |
Payables and Accruals [Abstract] | |
Schedule of accrued liabilities | March 31, 2018 2017 Accrued interest $ 184,827 $ 121,493 Accrued professional fees 2,634 2,634 Accrued payroll taxes 29,727 29,727 Accrued executive and director compensation 212,173 137,173 Total $ 429,361 $ 291,027 |
Convertible Notes Payable (Tabl
Convertible Notes Payable (Tables) | 12 Months Ended |
Mar. 31, 2018 | |
Convertible Notes Payable [Abstract] | |
Schedule of convertible debt | March 31, 2018 2017 Principal amount $ 480,740 $ 480,740 Less: unamortized debt discount (21,649 ) (107,006 ) Convertible notes payable, net $ 459,091 $ 373,734 |
Schedule of fair value of the derivative liabilities | 2018 2017 Dividend rate —% —% Term (in years) 0.1 to 2.8 years 1.8 to 3.0 years Volatility 290% to 305 % 282% to 293 % Risk—free interest rate 2.09% to 2.56% 1.27% to 1.93% |
Stockholders' Deficit (Tables)
Stockholders' Deficit (Tables) | 12 Months Ended |
Mar. 31, 2018 | |
Stockholders' Equity Note [Abstract] | |
Schedule of warrant activities | Number of Weighted Weighted Aggregate Balance Outstanding at March 31, 2016 5,273,315 $ 0.09 3.9 — Granted/Cancelled/Expired — — — — Balance Outstanding at March 31, 2017 5,273,315 0.09 2.9 — Expired (718,608 ) 0.40 — Balance Outstanding at March 31, 2018 4,554,707 $ 0.04 2.2 $ — Exercisable at March 31, 2018 4,554,707 $ 0.04 2.2 $ — |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Mar. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Schedule of effective statutory rate and the provision for income taxes for the years | Years Ended 2018 2017 Income tax expense (benefit) at U.S. statutory rate of 34% $ (51,825 ) $ 94,584 Income tax benefit - State (7,621 ) 13,909 Non-deductible expenses (income) 4,160 (216,261 ) Effect of change in U.S. effective rate to 21% 18,429 — Change in valuation allowance 36,857 (107,768 ) Total provision for income tax $ — $ — |
Schedule of deferred tax assets | Years Ended Deferred Tax Asset: 2018 2017 Net operating losses $ 1,004,394 $ 1,451,305 Valuation allowance (1,004,394 ) (1,451,305 ) Net deferred tax asset $ — $ — |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Details) - USD ($) | 1 Months Ended | 12 Months Ended | |
Dec. 22, 2017 | Mar. 31, 2018 | Mar. 31, 2017 | |
Summary of Significant Accounting Policies (Details) [Line Items] | |||
Net income | $ 152,425 | ||
Accumulated deficit | (10,420,274) | $ (10,267,849) | |
Stockholders deficit | 1,175,128 | ||
Working capital deficit | 1,175,128 | ||
Inventory | $ 570 | ||
Minimum [Member] | |||
Summary of Significant Accounting Policies (Details) [Line Items] | |||
Effective income tax rate percentage | 21.00% | ||
Maximum [Member] | |||
Summary of Significant Accounting Policies (Details) [Line Items] | |||
Effective income tax rate percentage | 34.00% |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies (Details) - Schedule of financial assets and liabilities categorized as Level 3 - USD ($) | Mar. 31, 2018 | Mar. 31, 2017 | Mar. 31, 2016 |
Level 1 [Member] | |||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |||
Derivative liabilities | |||
Level 2 [Member] | |||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |||
Derivative liabilities | |||
Level 3 [Member] | |||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |||
Derivative liabilities | $ 5,474 | $ 80,165 | $ 800,973 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies (Details) - Schedule of financial instruments - Level 3 [Member] - USD ($) | 12 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Summary of Significant Accounting Policies (Details) - Schedule of financial instruments [Line Items] | ||
Balance at beginning of year | $ 80,165 | $ 800,973 |
Gain from change in fair value of derivative liabilities | (74,691) | (720,808) |
Balance at end of year | $ 5,474 | $ 80,165 |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies (Details) - Schedule of antidilutive securities excluded from the computation of dilutive income (loss) per common share - Warrant [Member] - shares | 12 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Stock warrants | 5,273,315 | 5,273,315 |
Convertible notes | 63,369,653 | 58,495,484 |
Total | 68,642,968 | 63,768,799 |
Summary of Significant Accoun_7
Summary of Significant Accounting Policies (Details) - Schedule of reconciliation of the numerator and denominator used in the basic and diluted earnings per share - USD ($) | 12 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Numerator: | ||
Net income | $ 278,188 | |
Add: Interest expense | 229,560 | |
Less: Gain from change in fair value of derivative liabilities | (720,808) | |
Adjusted net loss | $ (213,060) | |
Denominator: | ||
Weighted-average shares of common stock (in Shares) | 62,570,659 | |
Dilutive effect of convertible notes (in Shares) | 58,495,484 | |
Diluted weighted-average of common stock (in Shares) | 62,570,659 | 121,066,143 |
Net income (loss) per common share: | ||
Basic (in Dollars per share) | $ 0 | $ 0 |
Diluted (in Dollars per share) | $ 0 | $ 0 |
Accrued Liabilities (Details) -
Accrued Liabilities (Details) - Schedule of accrued liabilities - USD ($) | Mar. 31, 2018 | Mar. 31, 2017 |
Schedule of accrued liabilities [Abstract] | ||
Accrued interest | $ 184,827 | $ 121,493 |
Accrued professional fees | 2,634 | 2,634 |
Accrued payroll taxes | 29,727 | 29,727 |
Accrued executive and director compensation | 212,173 | 137,173 |
Total | $ 429,361 | $ 291,027 |
Loans Payable (Details)
Loans Payable (Details) - USD ($) | 12 Months Ended | |||
Mar. 31, 2018 | Mar. 31, 2017 | May 31, 2016 | Mar. 31, 2016 | |
Debt Disclosure [Abstract] | ||||
Aggregate of principal amount | $ 11,155 | $ 132,769 | ||
Interest rate, percentage | 10.00% | 10.00% | ||
Loan outstanding principal balance | $ 143,924 | $ 143,924 | ||
Accrued interest | 31,871 | 17,278 | ||
Interest expense | $ 14,593 | $ 14,527 |
Convertible Notes Payable (Deta
Convertible Notes Payable (Details) - USD ($) | 2 Months Ended | 12 Months Ended | ||||||||
Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2018 | Mar. 31, 2017 | Mar. 31, 2016 | Nov. 30, 2017 | Oct. 31, 2017 | May 31, 2015 | Nov. 30, 2014 | Oct. 31, 2014 | |
Convertible Notes Payable (Details) [Line Items] | ||||||||||
Principal amount of debt | $ 480,740 | $ 480,740 | ||||||||
Outstanding principal amount | $ 130,510 | |||||||||
Accrued interest | $ 10,792 | |||||||||
Convertible notes converted to shares (in Shares) | 7,065,084 | |||||||||
Interest expense | 48,741 | 48,741 | ||||||||
Gain from change on fair value of derivative liabilities | 74,691 | 720,808 | ||||||||
Amortization of debt discount | 85,357 | 166,292 | ||||||||
Fiscal 2015 Convertible Notes [Member] | ||||||||||
Convertible Notes Payable (Details) [Line Items] | ||||||||||
Principal amount of debt | $ 400,000 | $ 400,000 | ||||||||
Convertible note interest rate | 10.00% | 10.00% | ||||||||
Conversion share price (in Dollars per share) | $ 0.02 | |||||||||
Reduced conversion share price (in Dollars per share) | 0.01 | |||||||||
Outstanding principal amount | 269,490 | 269,490 | ||||||||
Accrued interest | 94,843 | 67,520 | ||||||||
Fiscal 2016 Notes I [Member] | ||||||||||
Convertible Notes Payable (Details) [Line Items] | ||||||||||
Convertible note interest rate | 10.00% | |||||||||
Conversion share price (in Dollars per share) | $ 0.05 | |||||||||
Reduced conversion share price (in Dollars per share) | 0.01 | |||||||||
Outstanding principal amount | $ 115,000 | 115,000 | 115,000 | |||||||
Accrued interest | 33,393 | 21,733 | ||||||||
Warrants term, description | Pursuant to the Fiscal 2016 Agreements I, the Company issued to the purchasers for an aggregate subscription amount of $115,000: (i) convertible promissory notes in the aggregate principal amount of $115,000 (the “Fiscal 2016 Notes I”) and (ii) five-year warrants to purchase an aggregate of 2,300,000 (twenty warrants for each dollar of the principal amount) shares Company’s common stock at an exercise price of $0.07 (the “Fiscal 2016 Warrants I”). | |||||||||
Fiscal 2016 Agreements I [Member] | ||||||||||
Convertible Notes Payable (Details) [Line Items] | ||||||||||
Aggregate subscription amount | $ 115,000 | |||||||||
Fiscal 2016 Warrants I [Member] | ||||||||||
Convertible Notes Payable (Details) [Line Items] | ||||||||||
Warrants exercise price (in Dollars per share) | $ 0.07 | |||||||||
Fiscal 2016 Notes II [Member] | ||||||||||
Convertible Notes Payable (Details) [Line Items] | ||||||||||
Principal amount of debt | $ 96,250 | |||||||||
Convertible note interest rate | 10.00% | |||||||||
Conversion share price (in Dollars per share) | $ 0.05 | |||||||||
Reduced conversion share price (in Dollars per share) | $ 0.01 | |||||||||
Outstanding principal amount | 96,250 | 96,250 | ||||||||
Accrued interest | $ 24,720 | $ 14,962 | ||||||||
Warrants term, description | Pursuant to the Fiscal 2016 Agreements II, the Company issued to the purchasers for an aggregate subscription amount of $96,250: (i) convertible promissory notes in the aggregate principal amount of $96,250 (the “Fiscal 2016 Notes II”) and (ii) five-year warrants to purchase an aggregate of 1,925,000 (twenty warrants for each dollar of the principal amount) shares Company’s common stock at an exercise price of $0.07 (the “Fiscal 2016 Warrants II”). | |||||||||
Number of conversion warrant (in Shares) | 1,925,000 | |||||||||
Fiscal 2016 Agreements II [Member] | ||||||||||
Convertible Notes Payable (Details) [Line Items] | ||||||||||
Aggregate subscription amount | $ 96,250 | |||||||||
Fiscal 2016 Warrants II [Member] | ||||||||||
Convertible Notes Payable (Details) [Line Items] | ||||||||||
Warrants exercise price (in Dollars per share) | $ 0.07 |
Convertible Notes Payable (De_2
Convertible Notes Payable (Details) - Schedule of convertible debt - USD ($) | Mar. 31, 2018 | Mar. 31, 2017 |
Schedule of convertible debt [Abstract] | ||
Principal amount | $ 480,740 | $ 480,740 |
Less: unamortized debt discount | (21,649) | (107,006) |
Convertible notes payable, net | $ 459,091 | $ 373,734 |
Convertible Notes Payable (De_3
Convertible Notes Payable (Details) - Schedule of fair value of the derivative liabilities | 12 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Convertible Notes Payable (Details) - Schedule of fair value of the derivative liabilities [Line Items] | ||
Dividend rate | ||
Minimum [Member] | ||
Convertible Notes Payable (Details) - Schedule of fair value of the derivative liabilities [Line Items] | ||
Term (in years) | 36 days | 1 year 292 days |
Volatility | 290.00% | 282.00% |
Risk—free interest rate | 2.09% | 1.27% |
Maximum [Member] | ||
Convertible Notes Payable (Details) - Schedule of fair value of the derivative liabilities [Line Items] | ||
Term (in years) | 2 years 292 days | 3 years |
Volatility | 305.00% | 293.00% |
Risk—free interest rate | 2.56% | 1.93% |
Stockholders' Deficit (Details)
Stockholders' Deficit (Details) - USD ($) | 12 Months Ended | ||
Mar. 31, 2018 | Mar. 31, 2017 | Mar. 31, 2016 | |
Stockholders' Deficit (Details) [Line Items] | |||
Common stock authorized to issue | 200,000,000 | ||
Common stock, shares authorized | 190,000,000 | 190,000,000 | |
Common stock, par value (in Dollars per share) | $ 0.001 | $ 0.001 | |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 | |
Preferred stock, par value (in Dollars per share) | $ 0.001 | $ 0.001 | |
Common stock, shares issued | 62,570,659 | 62,570,659 | |
Warrants issued and outstanding | 329,707 | ||
Warrants expired (in Dollars) | $ 718,608 | ||
Warrant [Member] | |||
Stockholders' Deficit (Details) [Line Items] | |||
Warrants issued and outstanding | 1,048,315 | ||
Warrant [Member] | Fiscal years 2013 to 2015 [Member] | |||
Stockholders' Deficit (Details) [Line Items] | |||
Issuance of warrant | 1,048,315 | ||
Warrants exercise price (in Dollars per share) | $ 0.40 | ||
Warrant [Member] | Convertible Note [Member] | |||
Stockholders' Deficit (Details) [Line Items] | |||
Issuance of warrant | 4,225,000 | ||
Warrants exercise price (in Dollars per share) | $ 0.07 | ||
Warrants issued and outstanding | 4,225,000 | 4,225,000 | |
Conversion price down (in Dollars per share) | $ 0.01 |
Stockholders' Deficit (Detail_2
Stockholders' Deficit (Details) - Schedule of warrant activities - USD ($) | 12 Months Ended | ||
Mar. 31, 2018 | Mar. 31, 2017 | Mar. 31, 2016 | |
Schedule of warrant activities [Abstract] | |||
Number of Warrants, Balance Outstanding (in Shares) | 4,554,707 | 5,273,315 | 5,273,315 |
Weighted Average Exercise Price, Balance Outstanding | $ 0.04 | $ 0.09 | $ 0.09 |
Weighted Average Remaining Contractual Term (Years), Balance Outstanding | 3 years 328 days | ||
Aggregate Intrinsic Value, Balance Outstanding (in Dollars) | |||
Number of Warrants, Granted/Cancelled/Expired (in Shares) | |||
Weighted Average Exercise Price, Granted/Cancelled/Expired | |||
Aggregate Intrinsic Value, Granted/Cancelled/Expired | |||
Weighted Average Remaining Contractual Term (Years), Balance Outstanding | 2 years 328 days | ||
Number of Warrants, Expired (in Shares) | (718,608) | ||
Weighted Average Exercise Price, Expired | $ 0.40 | ||
Aggregate Intrinsic Value, Expired | |||
Weighted Average Remaining Contractual Term (Years), Balance Outstanding | 2 years 73 days | ||
Number of Warrants, Exercisable (in Shares) | 4,554,707 | ||
Weighted Average Exercise Price, Exercisable | $ 0.04 | ||
Weighted Average Remaining Contractual Term (Years),Exercisable | 2 years 73 days | ||
Aggregate Intrinsic Value, Exercisable (in Shares) |
Income Taxes (Details)
Income Taxes (Details) - USD ($) | 1 Months Ended | 12 Months Ended | |
Dec. 22, 2017 | Mar. 31, 2018 | Mar. 31, 2017 | |
Income Taxes (Details) [Line Items] | |||
Deferred tax asset net operating loss carryforward | $ 3,863,055 | $ 3,721,296 | |
Change in allowance | 36,857 | $ (107,768) | |
Deferred tax asset | 483,768 | ||
Potential tax benefit loss carryforward | $ 967,537 | ||
Potential tax benefit expired | 2037 years | ||
Potential tax benefit net operating loss carryforward | $ 36,857 | ||
Minimum [Member] | |||
Income Taxes (Details) [Line Items] | |||
Current federal income tax rate | 21.00% | ||
Maximum [Member] | |||
Income Taxes (Details) [Line Items] | |||
Current federal income tax rate | 34.00% |
Income Taxes (Details) - Schedu
Income Taxes (Details) - Schedule of effective statutory rate and the provision for income taxes for the years - USD ($) | 12 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Schedule of effective statutory rate and the provision for income taxes for the years [Abstract] | ||
Income tax expense (benefit) at U.S. statutory rate of 34% | $ (51,825) | $ 94,584 |
Income tax benefit - State | (7,621) | 13,909 |
Non-deductible expenses (income) | 4,160 | (216,261) |
Effect of change in U.S. effective rate to 21% | 18,429 | |
Change in valuation allowance | 36,857 | (107,768) |
Total provision for income tax |
Income Taxes (Details) - Sche_2
Income Taxes (Details) - Schedule of effective statutory rate and the provision for income taxes for the years (Parentheticals) | 12 Months Ended |
Mar. 31, 2018 | |
Schedule of effective statutory rate and the provision for income taxes for the years [Abstract] | |
U.S. statutory rate | 34.00% |
U.S. effective rate | 21.00% |
Income Taxes (Details) - Sche_3
Income Taxes (Details) - Schedule of deferred tax assets - USD ($) | Mar. 31, 2018 | Mar. 31, 2017 |
Schedule of deferred tax assets [Abstract] | ||
Net operating losses | $ 1,004,394 | $ 1,451,305 |
Valuation allowance | (1,004,394) | (1,451,305) |
Net deferred tax asset |
Subsequent Events (Details)
Subsequent Events (Details) | 12 Months Ended |
Mar. 31, 2018USD ($) | |
Subsequent Events (Details) [Line Items] | |
Bear interest rate | 6.00% |
Due and payable term | 2 years |
November 2019 through June 2020 [Member] | |
Subsequent Events (Details) [Line Items] | |
Debt Instrument, Periodic Payment, Principal | $ 91,000 |