Cover
Cover - shares | 6 Months Ended | |
Apr. 30, 2022 | Jun. 14, 2022 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Apr. 30, 2022 | |
Document Fiscal Period Focus | Q2 | |
Document Fiscal Year Focus | 2022 | |
Current Fiscal Year End Date | --10-31 | |
Entity File Number | 001-34106 | |
Entity Registrant Name | VERUS INTERNATIONAL, INC. | |
Entity Central Index Key | 0001430523 | |
Entity Tax Identification Number | 11-3820796 | |
Entity Incorporation, State or Country Code | DE | |
Entity Address, Address Line One | 4300 Greenbriar Drive | |
Entity Address, City or Town | Stafford | |
Entity Address, State or Province | TX | |
Entity Address, Postal Zip Code | 77477 | |
City Area Code | (301) | |
Local Phone Number | 329-2700 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 490,265,882 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) | Apr. 30, 2022 | Oct. 31, 2021 |
Current Assets | ||
Cash | $ 6,789 | $ 66,022 |
Accounts receivable, net | 250,618 | 303,218 |
Inventory | 145,129 | 145,129 |
Other assets | 16,144 | 16,144 |
Assets of discontinued operations | 326 | 105,974 |
Total Current Assets | 419,006 | 636,487 |
Property and equipment, net | 64,651 | 85,067 |
Operating lease right-of-use asset | 152,830 | 198,637 |
Total Assets | 636,487 | 920,191 |
Current Liabilities | ||
Accounts payable and accrued expenses | 783,844 | 638,315 |
Operating lease liability | 95,115 | 92,771 |
Interest payable | 541,602 | 368,709 |
Due to former officer | 221,586 | 221,586 |
Notes payable | 1,562,985 | 1,533,294 |
Convertible notes payable, net | 489,909 | 530,358 |
Derivative liability | 522,921 | 471,219 |
Liabilities of discontinued operations | 162,752 | 227,338 |
Total Current Liabilities | 4,380,714 | 4,083,590 |
Operating lease liability, net of current portion | 57,715 | 105,866 |
Total Liabilities | 4,438,429 | 4,189,456 |
Stockholders’ Deficit | ||
Common stock, $0.000001 par value; 7,500,000,000 shares authorized and 87,521,179 and 23,844,566 shares issued at April 30, 2022 and October 31, 2021, respectively (as adjusted for a 1-for-500 reverse stock split as discussed in Note 1) | 88 | 24 |
Additional paid-in-capital | 47,455,109 | 46,889,360 |
Shares to be issued | 15,000 | 5,000 |
Accumulated deficit | (51,272,169) | (50,163,679) |
Total Stockholders’ Deficit | (3,801,942) | (3,269,265) |
Total Liabilities and Stockholders’ Deficit | 636,487 | 920,191 |
Series A Convertible Preferred Stock [Member] | ||
Stockholders’ Deficit | ||
Preferred stock value | 29 | 29 |
Series B Convertible Preferred Stock [Member] | ||
Stockholders’ Deficit | ||
Preferred stock value | ||
Series C Convertible Preferred Stock [Member] | ||
Stockholders’ Deficit | ||
Preferred stock value | $ 1 | $ 1 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | 6 Months Ended | 12 Months Ended |
Apr. 30, 2022 | Oct. 31, 2021 | |
Common stock, par value | $ 0.000001 | $ 0.000001 |
Common stock, shares authorized | 7,500,000,000 | 7,500,000,000 |
Common stock, shares issued | 87,521,179 | 23,844,566 |
Reverse stock split | 1-for-500 reverse stock split | 1-for-500 reverse stock split |
Series A Convertible Preferred Stock [Member] | ||
Convertible preferred stock, par value | $ 0.000001 | $ 0.000001 |
Convertible preferred stock, shares authorized | 120,000,000 | 120,000,000 |
Convertible preferred stock, shares issued | 28,944,601 | 28,944,601 |
Convertible preferred stock, shares outstanding | 28,944,601 | 28,944,601 |
Series B Convertible Preferred Stock [Member] | ||
Convertible preferred stock, par value | $ 0.000001 | $ 0.000001 |
Convertible preferred stock, shares authorized | 1,000,000 | 1,000,000 |
Convertible preferred stock, shares issued | 0 | 0 |
Convertible preferred stock, shares outstanding | 0 | 0 |
Series C Convertible Preferred Stock [Member] | ||
Convertible preferred stock, par value | $ 0.000001 | $ 0.000001 |
Convertible preferred stock, shares authorized | 1,000,000 | 1,000,000 |
Convertible preferred stock, shares issued | 680,801 | 680,801 |
Convertible preferred stock, shares outstanding | 680,801 | 680,801 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Apr. 30, 2022 | Apr. 30, 2021 | Apr. 30, 2022 | Apr. 30, 2021 | |
Income Statement [Abstract] | ||||
Revenue | $ 347,844 | $ 347,844 | ||
Cost of revenue | 168,792 | 168,867 | ||
Gross Profit | 179,052 | 178,977 | ||
Operating Expenses: | ||||
Salaries and benefits | 61,497 | 173,740 | 131,953 | 153,960 |
Legal and professional fees | 25,000 | 75,000 | ||
General and administrative | 135,143 | 203,145 | 236,684 | 358,482 |
Total Operating Expenses | 221,640 | 376,885 | 443,637 | 512,442 |
Operating loss | (221,640) | (197,833) | (443,637) | (333,465) |
Other (Expense) Income: | ||||
Interest expense | (102,373) | (80,784) | (185,793) | (146,941) |
Amortization of original issue discounts and deferred financing costs | (17,738) | (37,252) | (76,779) | (64,764) |
Loss on extinguishment and settlement of convertible notes payable | (4,494) | (34,823) | (115,086) | (34,941) |
(Loss) gain on change in fair value of derivative liability | (112,451) | (11,235) | (55,399) | 27,972 |
Default principal increase on convertible notes payable | (47,100) | (47,100) | ||
Initial derivative liability expense | (520,701) | (143,657) | (800,213) | |
Gain on settlement of liabilities | 104,774 | 104,774 | ||
Total Other (Expense) Income | (284,156) | (580,021) | (623,814) | (914,113) |
Loss from continuing operations before income taxes | (505,796) | (777,854) | (1,067,451) | (1,247,578) |
Income taxes | ||||
Loss from continuing operations | (505,796) | (777,854) | (1,067,451) | (1,247,578) |
Discontinued operations (Note 11) | ||||
(Loss) gain from discontinued operations | (5) | 70,341 | (41,039) | 93,930 |
Net loss | $ (505,801) | $ (707,513) | $ (1,108,490) | $ (1,153,648) |
Loss per common share: | ||||
Loss from continuing operations per common share – basic and diluted | $ (0.01) | $ (0.06) | $ (0.02) | $ (0.10) |
Loss from discontinued operations per common share – basic and diluted | 0 | 0 | 0 | 0 |
Loss per common share – basic and diluted | $ (0.01) | $ (0.06) | $ (0.02) | $ (0.10) |
Weighted average shares outstanding – basic and diluted | 58,243,463 | 12,497,725 | 46,307,744 | 12,041,395 |
Condensed Consolidated Statem_2
Condensed Consolidated Statement of Changes in Stockholders' Deficit (Unaudited) - USD ($) | Series A Preferred Stock [Member] Preferred Stock [Member] | Series B Preferred Stock [Member] Preferred Stock [Member] | Series C Preferred Stock [Member] Preferred Stock [Member] | Common Stock [Member] | Additional Paid-in Capital [Member] | Common Stock To Be Issued [Member] | Retained Earnings [Member] | Total |
Beginning balance at Oct. 31, 2020 | $ 29 | $ 1 | $ 10 | $ 45,562,840 | $ (44,164,783) | $ 1,398,097 | ||
Beginning Balance, shares at Oct. 31, 2020 | 28,944,601 | 680,801 | 10,278,867 | |||||
Conversion of convertible promissory notes to common stock | $ 2 | 464,652 | 464,654 | |||||
Conversion of convertible promissory notes to common stock, shares | 1,685,918 | |||||||
Net loss | (446,135) | (446,135) | ||||||
Issuance of common stock for vendor services | 18,964 | 18,964 | ||||||
Issuance of common stock for vendor services, shares | 67,728 | |||||||
Shares of common stock to be issued for vendor services | 13,100 | 13,100 | ||||||
Ending balance at Jan. 31, 2021 | $ 29 | $ 1 | $ 12 | 46,046,456 | 13,100 | (44,610,918) | 1,448,680 | |
Ending Balance, shares at Jan. 31, 2021 | 28,944,601 | 680,801 | 12,032,512 | |||||
Beginning balance at Oct. 31, 2020 | $ 29 | $ 1 | $ 10 | 45,562,840 | (44,164,783) | 1,398,097 | ||
Beginning Balance, shares at Oct. 31, 2020 | 28,944,601 | 680,801 | 10,278,867 | |||||
Net loss | (1,153,648) | |||||||
Ending balance at Apr. 30, 2021 | $ 29 | $ 1 | $ 13 | 46,271,776 | 28,100 | (45,318,431) | 981,488 | |
Ending Balance, shares at Apr. 30, 2021 | 28,944,601 | 680,801 | 12,744,768 | |||||
Beginning balance at Jan. 31, 2021 | $ 29 | $ 1 | $ 12 | 46,046,456 | 13,100 | (44,610,918) | 1,448,680 | |
Beginning Balance, shares at Jan. 31, 2021 | 28,944,601 | 680,801 | 12,032,512 | |||||
Conversion of convertible promissory notes to common stock | 118,658 | 118,658 | ||||||
Conversion of convertible promissory notes to common stock, shares | 312,256 | |||||||
Stock-based compensation for restricted shares under employment contract | 18,663 | 18,663 | ||||||
Net loss | (707,513) | (707,513) | ||||||
Shares of common stock to be issued for vendor services | 15,000 | 15,000 | ||||||
Issuance of common stock for note payable issuance | $ 1 | 87,999 | 88,000 | |||||
Issuance of common stock for note payable issuance, shares | 400,000 | |||||||
Ending balance at Apr. 30, 2021 | $ 29 | $ 1 | $ 13 | 46,271,776 | 28,100 | (45,318,431) | 981,488 | |
Ending Balance, shares at Apr. 30, 2021 | 28,944,601 | 680,801 | 12,744,768 | |||||
Beginning balance at Oct. 31, 2021 | $ 29 | $ 1 | $ 24 | 46,889,360 | 5,000 | (50,163,679) | (3,269,265) | |
Beginning Balance, shares at Oct. 31, 2021 | 28,944,601 | 680,801 | 23,844,566 | |||||
Conversion of convertible promissory notes to common stock | $ 32 | 405,787 | 405,819 | |||||
Conversion of convertible promissory notes to common stock, shares | 32,181,998 | |||||||
Stock-based compensation for restricted shares under employment contract | 22,395 | 22,395 | ||||||
Shares of common stock to be issued for board member services rendered | 5,000 | 5,000 | ||||||
Net loss | (602,689) | (602,689) | ||||||
Ending balance at Jan. 31, 2022 | $ 29 | $ 1 | $ 56 | 47,317,542 | 10,000 | (50,766,368) | (3,438,740) | |
Ending Balance, shares at Jan. 31, 2022 | 28,944,601 | 680,801 | 56,026,564 | |||||
Beginning balance at Oct. 31, 2021 | $ 29 | $ 1 | $ 24 | 46,889,360 | 5,000 | (50,163,679) | (3,269,265) | |
Beginning Balance, shares at Oct. 31, 2021 | 28,944,601 | 680,801 | 23,844,566 | |||||
Net loss | (1,108,490) | |||||||
Ending balance at Apr. 30, 2022 | $ 29 | $ 1 | $ 88 | 47,455,109 | 15,000 | (51,272,169) | (3,801,942) | |
Ending Balance, shares at Apr. 30, 2022 | 28,944,601 | 680,801 | 87,521,179 | |||||
Beginning balance at Jan. 31, 2022 | $ 29 | $ 1 | $ 56 | 47,317,542 | 10,000 | (50,766,368) | (3,438,740) | |
Beginning Balance, shares at Jan. 31, 2022 | 28,944,601 | 680,801 | 56,026,564 | |||||
Conversion of convertible promissory notes to common stock | $ 32 | 124,129 | 124,161 | |||||
Conversion of convertible promissory notes to common stock, shares | 31,494,615 | |||||||
Stock-based compensation for restricted shares under employment contract | 13,438 | 13,438 | ||||||
Shares of common stock to be issued for board member services rendered | 5,000 | 5,000 | ||||||
Net loss | (505,801) | (505,801) | ||||||
Ending balance at Apr. 30, 2022 | $ 29 | $ 1 | $ 88 | $ 47,455,109 | $ 15,000 | $ (51,272,169) | $ (3,801,942) | |
Ending Balance, shares at Apr. 30, 2022 | 28,944,601 | 680,801 | 87,521,179 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||||
Apr. 30, 2022 | Jan. 31, 2022 | Apr. 30, 2021 | Jan. 31, 2021 | Apr. 30, 2022 | Apr. 30, 2021 | Oct. 31, 2021 | |
Cash flows from operating activities: | |||||||
Net loss | $ (505,801) | $ (602,689) | $ (707,513) | $ (446,135) | $ (1,108,490) | $ (1,153,648) | |
Adjustments to reconcile net loss to net cash used in operating activities: | |||||||
Initial derivative liability expense | 520,701 | 143,657 | 800,213 | ||||
Loss on extinguishment and settlement of debt | 4,494 | 34,823 | 115,086 | 34,941 | |||
Amortization of original issue discounts and deferred financing costs | 17,738 | 37,252 | 76,779 | 64,764 | |||
Loss (Gain) on change in fair value of derivative liability | 112,451 | 11,235 | 55,399 | (27,972) | |||
Allowance for accounts receivable | 52,600 | ||||||
Default principal increase on convertible notes payable | 47,100 | 47,100 | |||||
Stock-based compensation | 45,833 | (40,523) | |||||
Depreciation and amortization | 20,416 | 20,935 | |||||
Gain on settlement of liabilities | (104,774) | (104,774) | |||||
Changes in operating assets and liabilities: | |||||||
Increase in accounts receivable | (347,844) | ||||||
Decrease in inventory | 17,400 | ||||||
Decrease in prepaid expenses | 41,729 | ||||||
Increase in other assets | (805) | ||||||
Increase in accounts payable and accrued expenses | 331,325 | 107,915 | |||||
Decrease in right to use and lease obligation, net | (9,386) | ||||||
Net cash used in operating activities of continuing operations | (220,295) | (597,055) | |||||
Net cash provided by (used in) operating activities of discontinued operations | 41,062 | (72,120) | |||||
Net cash used in operating activities | (179,233) | (669,175) | |||||
Cash flows from financing activities: | |||||||
Proceeds from issuance of convertible notes payable, net of commissions | 120,000 | 496,400 | |||||
Proceeds from issuance of notes payable | 240,325 | ||||||
Payments applied to convertible promissory notes | (63,000) | ||||||
Net cash provided by financing activities of continuing operations | 120,000 | 673,725 | |||||
Net (decrease) increase in cash | (59,233) | 4,550 | |||||
Cash at beginning of period | $ 66,022 | $ 6,150 | 66,022 | 6,150 | $ 6,150 | ||
Cash at end of period | $ 6,789 | $ 10,700 | 6,789 | 10,700 | $ 66,022 | ||
Supplemental disclosure: | |||||||
Cash paid for interest | 18,765 | ||||||
Common Stock Issued In Exchange For Conversion Of Convertible Promissory Note And Accrued Interest [Member] | |||||||
Supplemental disclosure of non-cash investing and financing activities: | |||||||
Value | $ 529,980 | $ 583,310 | |||||
Shares | 63,676,613 | 1,998,174 | |||||
Common Stock Issued For Note Payable Issuance [Member] | |||||||
Supplemental disclosure of non-cash investing and financing activities: | |||||||
Value | $ 88,000 | ||||||
Shares | 400,000 | ||||||
Common Stock Issued For Vendor Services [Member] | |||||||
Supplemental disclosure of non-cash investing and financing activities: | |||||||
Value | $ 18,964 | ||||||
Shares | 67,728 | ||||||
Common Stock To Be Issued For Vendor Services [Member] | |||||||
Supplemental disclosure of non-cash investing and financing activities: | |||||||
Value | $ 28,100 | ||||||
Shares | 107,364 |
NATURE OF BUSINESS AND BASIS OF
NATURE OF BUSINESS AND BASIS OF PRESENTATION | 6 Months Ended |
Apr. 30, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
NATURE OF BUSINESS AND BASIS OF PRESENTATION | NOTE 1: NATURE OF BUSINESS AND BASIS OF PRESENTATION Explanatory Note All references to shares of our common stock contained herein have been adjusted to reflect a 1-for-500 reverse stock split Organization and Nature of Business Verus International, Inc., including its wholly-owned subsidiaries, are collectively referred to herein as “Verus,” “VRUS”, “Company,” “us,” or “we.” We were incorporated in the state of Delaware under the name Spectrum Gaming Ventures, Inc. on May 25, 1994. On October 10, 1995, we changed our name to Select Video, Inc. On October 24, 2007, we filed a Certificate of Ownership with the Delaware Secretary of State whereby Webdigs, Inc., our wholly-owned subsidiary, was merged with and into us and we changed our name to Webdigs, Inc. On October 9, 2012, we consummated a share exchange (the “Exchange Transaction”) with Monaker Group, Inc. (formerly known as Next 1 Interactive, Inc.), a Nevada corporation (“Monaker”) pursuant to which we received all of the outstanding equity in Attaché Travel International, Inc., a Florida corporation and wholly owned subsidiary of Monaker (“Attaché”) in consideration for the issuance of 93 80 On May 1, 2018, Verus Foods MENA Limited (“Verus MENA”) entered into a Share Purchase and Sale Agreement with a purchaser (the “Purchaser”) pursuant to which Verus MENA sold 75 25 For the period August 1, 2018 through October 31, 2021, we, through our wholly-owned subsidiary, Verus Foods, Inc., an international supplier of consumer food products, were focused on international consumer packaged goods, foodstuff distribution and wholesale trade. Our fine food products were sourced in the United States and exported internationally. We marketed consumer food products under our own brands primarily to supermarkets, hotels, and other members of the wholesale trade. Initially, we focused on frozen foods, particularly meat, poultry, seafood, vegetables, and french fries with beverages as a second vertical, and during 2018, we added cold-storage facilities and began seeking international sources for fresh fruit, produce and similar perishables, as well as other consumer packaged foodstuff with the goal to create vertical farm-to-market operations. VERUS INTERNATIONAL, INC. NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS FOR THE SIX MONTHS ENDED APRIL 30, 2022 AND 2021 (UNAUDITED) NOTE 1: NATURE OF BUSINESS AND BASIS OF PRESENTATION (continued) Through October 31, 2021, we had a significant regional presence in the Middle East and North Africa (“MENA”) and sub-Saharan Africa (excluding The Office of Foreign Assets Control restricted nations), with deep roots in the Gulf Cooperation Council (“GCC”) countries, which includes the United Arab Emirates, Oman, Bahrain, Qatar, Kingdom of Saudi Arabia and Kuwait. During the three months ended October 31, 2021, we made a decision to cease operating as an international supplier of consumer food products, whereby we cancelled and settled all supplier and customer contracts to avoid any future significant liabilities. Accordingly, we have classified the operating results and associated assets and liabilities from Verus MENA as discontinued operations in the consolidated financial statements for the years ended October 31, 2021 and 2020 (see Note 11). In addition to the foregoing, since our acquisition of Big League Foods, Inc. (“BLF”) during April 2019, pursuant to which we acquired a license with Major League Baseball Properties, Inc. (“MLB”) to sell MLB-branded frozen dessert products and confections, we sold pint size ice cream in grocery store-type packaging. In addition, under our confections product line, we sold gummi and chocolate candies. The MLB license covers all 30 MLB teams, and all of our products pursuant to such license featured “home team” packaging that matched the fan base in each region. On December 18, 2020, we and our wholly owned subsidiary, BLF, entered into a letter agreement with ACG Global Solutions, Inc. and Game on Foods, Inc. (“GOF”), whereby for certain consideration, BLF sold, transferred, and assigned all of BLF’s rights, title, and interest in and to all of BLF’s assets to GOF. The assignments of our interests in the MLB and NHL licenses were completed on March 15, 2021 and March 25, 2021, respectively. Accordingly, we have classified the operating results and associated assets and liabilities from BLF as discontinued operations in the consolidated financial statements for the years ended October 31, 2021 and 2020 (see Note 11). Furthermore, during August 2019, we purchased all of the assets of a french fry business in the Middle East. Basis of Presentation The unaudited condensed consolidated financial information furnished herein reflects all adjustments, consisting only of normal recurring items, which in the opinion of management, are necessary to fairly state the Company’s financial position, results of operations and cash flows for the dates and periods presented and to make such information not misleading. Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) have been omitted pursuant to rules and regulations of the Securities and Exchange Commission (the “SEC”); nevertheless, management of the Company believes that the disclosures herein are adequate to make the information presented not misleading. The unaudited condensed consolidated financial statements for the six months ended April 30, 2022 and 2021 include the operations of BLF effective April 25, 2019, Verus MENA effective May 1, 2018, and Verus Foods, Inc. effective January 2017. The operating results and associated assets and liabilities from BLF and Verus MENA have been classified as discontinued operations in the unaudited consolidated financial statements for the six months ended April 30, 2022 and 2021 (see Note 11). All significant intercompany balances and transactions have been eliminated in the consolidation. These unaudited condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements for the year ended October 31, 2021, contained in the Company’s Annual Report on Form 10-K filed with the SEC on April 15, 2022. The results of operations for the six months ended April 30, 2022, are not necessarily indicative of results to be expected for any other interim period or the fiscal year ending October 31, 2022. VERUS INTERNATIONAL, INC. NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS FOR THE SIX MONTHS ENDED APRIL 30, 2022 AND 2021 (UNAUDITED) NOTE 1: NATURE OF BUSINESS AND BASIS OF PRESENTATION (continued) Impact of COVID-19 Pandemic A novel strain of coronavirus, COVID-19, surfaced during December 2019 and has spread around the world, including to the United States. During March 2020, COVID-19 was declared a pandemic by the World Health Organization. During certain periods of the pandemic thus far, a number of U.S. states and various countries throughout the world had been under governmental orders requiring that all workers remain at home unless their work was critical, essential, or life-sustaining. As a result of these governmental orders, the Company temporarily closed its domestic and international offices and required all of its employees to work remotely. As economic activity has begun and continues recovering, the impact of the COVID-19 pandemic on our business has been more reflective of greater economic and marketplace dynamics. Furthermore, in light of variant strains of the virus that have emerged, the COVID-19 pandemic could once again impact our operations and the operations of our customers and vendors as a result of quarantines, illnesses, and travel restrictions. The full impact of the COVID-19 pandemic on the Company’s financial condition and results of operations will depend on future developments, such as the ultimate duration and scope of the pandemic, its impact on the Company’s employees, customers, and vendors, in addition to how quickly normal economic conditions and operations resume and whether the pandemic impacts other risks disclosed in Item 1A “Risk Factors” within this Annual Report on Form 10-K. Even after the pandemic has subsided, the Company may continue to experience adverse impacts to its business as a result of any economic recession or depression that has occurred as a result of the pandemic. Therefore, the Company cannot reasonably estimate the impact at this time. The Company continues to actively monitor the pandemic and may determine to take further actions that alter its business operations as may be required by federal, state, or local authorities or that it determines are in the best interests of its employees, customers, vendors, and shareholders. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 6 Months Ended |
Apr. 30, 2022 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Use of Estimates The preparation of unaudited condensed consolidated 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 unaudited condensed consolidated financial statements and reported amounts of revenues and expenses for the reporting period. Actual results could differ from those estimates. If actual results significantly differ from the Company’s estimates, the Company’s financial condition and results of operations could be materially impacted. Significant estimates include the collectability of accounts receivable, valuations of inventory, estimated useful lives of finite-lived intangible assets, accrued expenses, valuation of derivative liabilities, stock-based compensation and the valuation reserve for income taxes. Reclassifications Certain reclassifications of prior period amounts have been made to enhance comparability with the current period unaudited condensed consolidated financial statements, including, but not limited to, presentation of certain items within the unaudited consolidated balance sheets, unaudited statements of operations, unaudited consolidated statements of cash flows, and certain notes to the unaudited condensed consolidated financial statements. These reclassifications had no effect on the previously reported net loss. VERUS INTERNATIONAL, INC. NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS FOR THE SIX MONTHS ENDED APRIL 30, 2022 AND 2021 (UNAUDITED) NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) Concentrations of Credit Risk Credit Risk Financial instruments which potentially subject the Company to concentrations of credit risk consist principally of cash and cash equivalents and accounts receivable. The Company maintains cash and cash equivalents with high-quality financial institutions. Deposits held with the financial institutions may exceed the amount of insurance provided by the Federal Deposit Insurance Corporation on such deposits, but may be redeemed upon demand. The Company performs periodic evaluations of the relative credit standing of the financial institutions. With respect to accounts receivable, the Company monitors the credit quality of its customers as well as maintains an allowance for doubtful accounts for estimated losses resulting from the inability of customers to make required payments. Revenue Risk The Company’s products accounts receivable, net and revenues are geographically concentrated with customers located domestically in the United States. In addition, significant concentrations exist with a limited number of customers. Approximately 36 Supplier Risk The Company purchases substantially all of its products from a limited number suppliers. Increases in the prices of the products which we purchase could adversely affect our operating results if we are unable to offset the effect of these increased costs through price increases, and we can provide no assurance that we will be able to pass along such increased costs to our customers. Furthermore, if we cannot obtain sufficient products or our suppliers cease to be available to us, we could experience shortages in our products or be unable to meet our commitments to customers. Alternative sources of products, if available, may be more expensive. For periods in which the prices are declining, the Company may be required to write down its inventory carrying cost which, depending on the extent of the differences between market price and carrying cost, could have a material adverse effect on the Company’s consolidated results of operations and financial position. Cash and Cash Equivalents For purposes of balance sheet presentation and reporting of cash flows, the Company considers all unrestricted demand deposits, money market funds and highly liquid debt instruments with an original maturity of less than 90 days to be cash and cash equivalents. There were no cash equivalents at April 30, 2022 or October 31, 2021. The Company places its cash and cash equivalents with high-quality financial institutions. At times, balances in the Company’s cash accounts may exceed the Federal Deposit Insurance Corporation (“FDIC”) limit. At April 30, 2022 and October 31, 2021, the Company’s cash balances did not exceed the FDIC limit. VERUS INTERNATIONAL, INC. NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS FOR THE SIX MONTHS ENDED APRIL 30, 2022 AND 2021 (UNAUDITED) NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) Accounts Receivable The Company regularly reviews outstanding receivables and provides for estimated losses through an allowance for doubtful accounts. In evaluating the level of established loss reserves, the Company makes judgments regarding its customers’ ability to make required payments, economic events and other factors. As the financial condition of these parties change, circumstances develop or additional information becomes available, adjustments to the allowance for doubtful accounts may be required. The Company maintains reserves for potential credit losses and such losses traditionally have been within its expectations. At April 30, 2022 and October 31, 2021, we determined $ 250,600 198,000 due to the past due status of certain accounts receivable invoices. Inventory Inventory is stated at the lower of net realizable value or cost, determined on the first-in, first-out basis. Net realizable value is based on estimated selling prices in the ordinary course of business less reasonably predictable costs of completion and transportation. Inventories consist of finished products. Property and Equipment All expenditures on the acquisition for property and equipment are recorded at cost and capitalized as incurred, provided the asset benefits the Company for a period of more than one year. Expenditures on routine repairs and maintenance of property and equipment are charged directly to operating expense. The property and equipment is depreciated based upon its estimated useful life after being placed in service. Leasehold improvements are depreciated based upon the remaining term of the related lease. The estimated useful lives range from 3 7 Impairment of Long-Lived Assets In accordance with Accounting Standards Codification (“ASC”) 360-10, “Property, Plant, and Equipment”, the Company periodically reviews its long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets may not be fully recoverable. The Company recognizes an impairment loss when the sum of expected undiscounted future cash flows is less than the carrying amount of the asset. The amount of impairment is measured as the difference between the asset’s estimated fair value and its book value. Fair Value of Financial Instruments The Company measures its financial instruments in accordance with ASC topic 820, “Fair Value Measurements and Disclosures” (“ASC 820”), formerly SFAS No. 157 “Fair Value Measurements”. ASC 820 defines “fair value” as the price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. VERUS INTERNATIONAL, INC. NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS FOR THE SIX MONTHS ENDED APRIL 30, 2022 AND 2021 (UNAUDITED) NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) ASC 820 also describes three levels of inputs that may be used to measure fair value: Level 1: Observable inputs that reflect unadjusted quoted prices for identical assets or liabilities traded in active markets. Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. Level 3: Inputs that are generally unobservable. These inputs may be used with internally developed methodologies that result in management’s best estimate of fair value. Financial instruments consist principally of cash, accounts receivable, prepaid expenses, accounts payable, accrued liabilities and other current liabilities. The carrying amounts of such financial instruments in the accompanying balance sheets approximate their fair values due to their relatively short-term nature. The fair value of short and long-term debt is based on current rates at which the Company could borrow funds with similar remaining maturities. The carrying amounts approximate fair value. It is management’s opinion that the Company is not exposed to any significant currency or credit risks arising from these financial instruments. At April 30, 2022, the Company had a Level 3 financial instrument related to its derivative liability. Revenue Recognition The Company recognizes revenue in accordance with the Financial Accounting Standards Board’s (“FASB”), Accounting Standards Codification (“ASC”) ASC 606, Revenue from Contracts with Customers (“ASC 606”). Revenues are recognized when control is transferred to customers in amounts that reflect the consideration the Company expects to be entitled to receive in exchange for those goods. Revenue recognition is evaluated through the following five steps: (i) identification of the contract, or contracts, with a customer; (ii) identification of the performance obligations in the contract; (iii) determination of the transaction price; (iv) allocation of the transaction price to the performance obligations in the contract; and (v) recognition of revenue when or as a performance obligation is satisfied. Revenue is derived from the sale of consumable and non-consumable products. The Company recognizes revenue when obligations under the terms of a contract with the customer are satisfied. Product sales occur once control is transferred upon delivery to the customer. Revenue is measured as the amount of consideration the Company expects to receive in exchange for transferring products. The amount of consideration the Company receives and revenue the Company recognizes varies with changes in customer incentives the Company offers to its customers and their customers. In the event any discounts, sales incentives, or similar arrangements are agreed to with a customer, such amounts are estimated at time of sale and deducted from revenue. Sales taxes and other similar taxes are excluded from revenue (see Note 5). A contract asset is recognized for incremental costs to obtain a customer contract that are recoverable, otherwise such incremental costs are expensed as incurred. Cost of Revenues Cost of revenues represents the cost of the products sold during the periods presented. Shipping and Handling Costs Shipping and handling costs for freight expense on goods shipped are included in cost of sales. For the six months ended April 30, 2022 and 2021 there was no freight expense on goods shipped as the operating results and associated assets and liabilities from BLF and Verus MENA have been classified as discontinued operations in the consolidated financial statements for the three months ended October 31, 2022 and 2021 (see Note 11). VERUS INTERNATIONAL, INC. NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS FOR THE SIX MONTHS ENDED APRIL 30, 2022 AND 2021 (UNAUDITED) NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) Customer Deposits From time to time the Company requires prepayments for deposits in advance of delivery of products. Such amounts are initially recorded as customer deposits. The Company recognizes such revenue as it is earned in accordance with revenue recognition policies. Share-Based Compensation The Company computes share based payments in accordance with the provisions of ASC Topic 718, Compensation – Stock Compensation Derivative Instruments The Company accounts for financing arrangements that consist of freestanding derivative instruments or are hybrid instruments that contain embedded derivative features. The Company accounts for these arrangements in accordance with ASC Topic 815, Accounting for Derivative Instruments and Hedging Activities The Company estimates fair values of derivative financial instruments using various techniques (and combinations thereof) that are considered consistent with the objective measuring fair values. In selecting the appropriate technique, the Company considers, among other factors, the nature of the instrument, the market risks that it embodies and the expected means of settlement. Estimating fair values of derivative financial instruments requires the development of significant and subjective estimates that may, and are likely to, change over the duration of the instrument with related changes in internal and external market factors. In addition, option-based techniques (such as Black-Scholes model) are highly volatile and sensitive to changes in the trading market price of the Company’s common stock. Since derivative financial instruments are initially and subsequently carried at fair values, our income (expense) going forward will reflect the volatility in these estimates and assumption changes. Convertible Debt Instruments The Company records debt net of debt discount for beneficial conversion features and warrants, on a relative fair value basis. Beneficial conversion features are recorded pursuant to the Beneficial Conversion and Debt Topics of the Financial Accounting Standards Board (“FASB”) ASC. The amounts allocated to warrants and beneficial conversion rights are recorded as debt discount and as additional paid-in-capital. Debt discount is amortized to interest expense over the life of the debt using the effective interest method. VERUS INTERNATIONAL, INC. NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS FOR THE SIX MONTHS ENDED APRIL 30, 2022 AND 2021 (UNAUDITED) NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) Foreign Currency Translation Through October 31, 2021, the Company had one non-U.S. subsidiary, where the functional currency was the United Arab Emirates dirham (“AED”). The Company’s foreign subsidiary maintained its records using local currency. The related assets and liabilities of this non-U.S. subsidiary have been translated using end of period exchange rates and stockholders’ equity is translated at the historical exchange rates to the U.S. dollar. Income and expense items were translated using average exchange rates for the period. The resulting translation adjustments, net of income taxes, are reported as other comprehensive income and accumulated other comprehensive income in the stockholder’s equity in accordance with ASC 220 – Comprehensive Income. The exchange rate used to translate amounts in AED into USD for the purposes of preparing the unaudited condensed consolidated financial statements were as follows: SCHEDULE OF FOREIGN CURRENCY TRANSLATION OF EXCHANGE RATES Balance sheet: April 30, 2022 October 31, 2021 Period-end AED: USD exchange rate $ 0.27229 $ 0.27230 Income statement: For the Three Months Ended For the Six Months Ended April 30, April 30, 2022 2021 2022 2021 Average Period AED: USD exchange rate $ 0.27229 $ 0.27228 $ 0.27229 $ 0.27228 Translation gains and losses that arise from exchange rate fluctuations from transactions denominated in a currency other than the functional currency are translated, as the case may be, at the rate on the date of the transaction and included in the results of operations as incurred. Income Taxes The Company accounts for income taxes in accordance with Accounting for Income Taxes, as clarified by ASC 740-10, Accounting for Uncertainty in Income Taxes ASC 740 requires that the Company recognize the financial statement benefit of a tax position only after determining that the relevant tax authority would more likely than not sustain the position following an audit. For tax positions meeting the “more-likely-than-not” threshold, the amount recognized in the consolidated financial statements is the largest benefit that has a greater than 50 percent likelihood of being realized upon ultimate settlement with the relevant tax authority. The Company’s tax returns for its October 31, 2021, 2020, 2019, and 2018 tax years may be selected for examination by the taxing authorities as the statute of limitations remains open. The Company recognizes expenses for tax penalties and interest assessed by the Internal Revenue Service and other taxing authorities upon receiving valid notice of assessments. The Company has received no such notices for the tax years ended October 31, 2021 and 2020. VERUS INTERNATIONAL, INC. NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS FOR THE SIX MONTHS ENDED APRIL 30, 2022 AND 2021 (UNAUDITED) NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) Earnings Per Share In accordance with the provisions of FASB ASC Topic 260, Earnings per Share In computing diluted EPS, only potential common shares that are dilutive, those that reduce EPS or increase loss per share, are included. The effect of contingently issuable shares are not included if the result would be anti-dilutive, such as when a net loss is reported. Therefore, basic and diluted EPS are computed using the same number of weighted average shares for the three and six months ended April 30, 2022 and 2021, as we incurred a net loss for those periods. At April 30, 2022, there were outstanding warrants to purchase approximately 1,340,000 194,000 2,900,000 546,000,000 2,620,000 194,000 107,000 5,400,000 Modification/Extinguishment of Debt In accordance with ASC 470, a modification or an exchange of debt instruments that adds or eliminates a conversion option that was substantive at the date of the modification or exchange is considered a substantive change and is measured and accounted for as extinguishment of the original instrument along with the recognition of a gain or loss. Additionally, under ASC 470, a substantive modification of a debt instrument is deemed to have been accomplished with debt instruments that are substantially different if the present value of the cash flows under the terms of the new debt instrument is at least 10 percent different from the present value of the remaining cash flows under the terms of the original instrument. A substantive modification is accounted for as an extinguishment of the original instrument along with the recognition of a gain or loss. Concentrations, Risks and Uncertainties A significant portion of the Company’s ongoing operations are related to the nutraceutical products industry, and its prospects for success are tied indirectly to interest rates and the worldwide demand for the Company’s nutraceutical products. Recently Adopted Accounting Standards Effective November 1, 2021, the Company adopted ASU 2019-12, Income Taxes (Topic 740) VERUS INTERNATIONAL, INC. NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS FOR THE SIX MONTHS ENDED APRIL 30, 2022 AND 2021 (UNAUDITED) NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) Recently Issued Accounting Standards Not Yet Adopted During May 2021, the FASB issued ASU 2021-04, to clarify and reduce diversity in accounting for modifications or exchanges of freestanding equity-classified written call options that remain equity classified after modification or exchange. The standard is effective for the Company as of November 1, 2022, with early adoption permitted. The Company is reviewing the impact of this guidance but does not currently expect the adoption of this guidance to have a material impact on its consolidated financial statements. During August 2020, the FASB issued ASU 2020-06, to modify and simplify the application of U.S. GAAP for certain financial instruments with characteristics of liabilities and equity. The standard is effective for the Company as of November 1, 2024, with early adoption permitted. The Company is reviewing the impact of this guidance but does not currently expect the adoption of this guidance to have a material impact on its consolidated financial statements. Management does not believe that any other recently issued, but not yet effective accounting pronouncements, if adopted, would have a material impact on the accompanying unaudited condensed consolidated financial statements. |
GOING CONCERN
GOING CONCERN | 6 Months Ended |
Apr. 30, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
GOING CONCERN | NOTE 3: GOING CONCERN The accompanying unaudited condensed consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company has incurred a net loss from continuing operations of $ 1,067,451 220,295 3,961,708 51,272,169 In order to meet its working capital needs through the next twelve months from the date of this report and to fund the growth of its business, the Company may consider plans to raise additional funds through the issuance of equity or debt. Although the Company intends to obtain additional financing to meet its cash needs, the Company may be unable to secure any additional financing on terms that are favorable or acceptable to it, if at all. The Company’s ability to raise additional capital will also be impacted by the continued COVID-19 pandemic, which such ability is highly uncertain, cannot be predicted, and could have an adverse effect on the Company’s business and financial condition. |
LEASES
LEASES | 6 Months Ended |
Apr. 30, 2022 | |
Leases | |
LEASES | NOTE 4: LEASES At April 30, 2022, the Company was party to one operating lease for its corporate office and domestic warehouse operations in Stafford, Texas. Effective February 8, 2021, the Company terminated the operating lease for its corporate office at Gaithersburg, Maryland and entered into a new, short-term lease, which the Company subsequently terminated. The Company also terminated its short-term lease for office space in Dubai, UAE. At the inception of a contract, the Company assesses whether the contract is, or contains, a lease. The Company’s assessment is based on: (1) whether the contract involves the use of a distinct identified asset, (2) whether the Company obtains the right to substantially all the economic benefit from the use of the asset throughout the term, and (3) whether the Company has the right to direct the use of the asset. The Company allocates the consideration in the contract to each lease and non-lease component based on the component’s relative stand-alone price to determine the lease payments. Lease and non-lease components are accounted for separately. Leases are classified as either finance leases or operating leases based on criteria in ASC 842. VERUS INTERNATIONAL, INC. NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS FOR THE SIX MONTHS ENDED APRIL 30, 2022 AND 2021 (UNAUDITED) NOTE 4: LEASES (continued) At lease commencement, the Company records a lease liability equal to the present value of the remaining lease payments, discounted using the rate implicit in the lease or, if that rate cannot be readily determined, the Company’s incremental borrowing rate. A corresponding ROU asset is recorded, measured based on the initial measurement of the lease liability. ROU assets also include any lease payments made and exclude lease incentives. Lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Lease expense for operating leases, consisting of lease payments, is recognized on a straight-line basis over the lease term. Included in lease expense are any variable lease payments incurred in the period that were not included in the initial lease liability. Lease expense for finance leases consists of the amortization of the ROU asset, which is calculated on a straight-line basis over the shorter of the useful life of the asset or the lease term, and interest expense on the lease liability, which is calculated using the effective interest rate method. The Company had no finance leases at April 30, 2022. For the six months ended April 30, 2022, the Company had operating lease costs of $ 50,298 16,900 42,327 At April 30, 2022, the remaining lease term for our domestic warehouse operations is 19 5 SCHEDULE OF FUTURE MINIMUM LEASE PAYMENTS Future Minimum Lease Payments: Remainder of fiscal year 2022 $ 50,298 2023 100,596 2024 8,383 Total Minimum Lease Payments $ 159,277 Less: amount representing interest (6,447 ) Present Value of Lease Liabilities $ 152,830 Less: current portion (95,115 ) Long-Term Portion $ 57,715 VERUS INTERNATIONAL, INC. NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS FOR THE SIX MONTHS ENDED APRIL 30, 2022 AND 2021 (UNAUDITED) |
REVENUE DISAGGREGATION
REVENUE DISAGGREGATION | 6 Months Ended |
Apr. 30, 2022 | |
Revenue from Contract with Customer [Abstract] | |
REVENUE DISAGGREGATION | NOTE 5: REVENUE DISAGGREGATION The Company did not generate any revenue from continuing operations for the six months ended April 30, 2022, and therefore did not have any revenue disaggregation. For the six months ended April 30, 2021, the Company’s largest two customers accounted for approximately 29 |
DEBT
DEBT | 6 Months Ended |
Apr. 30, 2022 | |
Debt Disclosure [Abstract] | |
DEBT | NOTE 6: DEBT Convertible Notes Payable On April 7, 2021, the Company entered into a securities purchase agreement with an accredited investor pursuant to which the Company issued and sold a convertible promissory note in the principal amount of $ 88,500 bears interest at a rate of 9 92,483 4,607,401 64,602 On April 8, 2021, the Company issued and sold a convertible promissory note to an accredited investor in the principal amount of $ 150,000 20,000 April 8, 2022 bears interest at a rate of 8 24 60 th 282,500 5,200 69,286 13,475,052 26,605 91,804 91,804 On April 15, 2021, the Company issued and sold a convertible promissory note to an accredited investor in the principal amount of $ 143,000 13,000 April 15, 2022 bears interest at a rate of 6 24 60 th 238,200 11,700 81,765 22,203,195 26,529 72,105 72,105 VERUS INTERNATIONAL, INC. NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS FOR THE SIX MONTHS ENDED APRIL 30, 2022 AND 2021 (UNAUDITED) NOTE 6: DEBT (continued) On June 29, 2021, the Company entered into a securities purchase agreement with an accredited investor pursuant to which the Company issued and sold a convertible promissory note in the principal amount of $ 85,750 June 29, 2022 bears interest at a rate of 9 92,700 6,950 10,225 24,321,086 54,279 8,567 2,648 On August 5, 2021, the Company entered into a securities purchase agreement with an accredited investor pursuant to which the Company issued and sold a convertible promissory note in the principal amount of $ 73,750 August 5, 2022 bears interest at a rate of 9 119,105 36,875 109,639 On August 12, 2021, the Company issued and sold a convertible promissory note to an accredited investor in the principal amount of $ 110,000 10,000 August 12, 2022 bears interest at a rate of 6 60 th 226,620 8,800 118,752 104,695 On November 5, 2021, the Company entered into a securities purchase agreement with an accredited investor pursuant to which the Company issued and sold a convertible promissory note in the principal amount of $ 78,750 November 5, 2022 bears interest at a rate of 9 143,657 3,750 84,263 76,818 VERUS INTERNATIONAL, INC. NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS FOR THE SIX MONTHS ENDED APRIL 30, 2022 AND 2021 (UNAUDITED) NOTE 6: DEBT (continued) On December 10, 2021, the Company entered into a securities purchase agreement with an accredited investor pursuant to which the Company issued and sold a convertible promissory note in the principal amount of $ 48,750 December 10, 2022 bears interest at a rate of 9 51,742 46,459 At April 30, 2022 and October 31, 2021, there was $ 489,909 530,358 11,141 42,442 During the six months ended April 30, 2022 and 2021, amortization of original issue discount and issuance costs amounted to $ 38,801 38,753 During the six months ended April 30, 2022, an aggregate of $ 258,034 320,131 91,457 Notes Payable On January 26, 2019, the Company entered into Amendment No. 1 to the promissory note (the “Monaco Note”) issued in favor of the Donald P. Monaco Insurance Trust on January 26, 2018 in the principal amount of $ 530,000 12 the maturity date of the Monaco Note was extended to January 26, 2020 On February 8, 2019, the Company entered into Amendment No. 2 to the Monaco Note whereby the maturity date of the Monaco Note was extended to November 8, 2019 Upon maturity on November 8, 2019, the Company was not able to pay the balance due and the interest rate immediately increased to 18 VERUS INTERNATIONAL, INC. NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS FOR THE SIX MONTHS ENDED APRIL 30, 2022 AND 2021 (UNAUDITED) NOTE 6: DEBT (continued) At April 30, 2022, the aggregate balance of the Monaco Note and accrued interest was $ 851,298 116,152 On March 31, 2020, the Company issued and sold a promissory note to an accredited investor in the principal amount of $ 312,500 62,500 July 1, 2020 incurred interest at a rate of 4 18 60,000 150,000 At April 30, 2022, the aggregate balance of the promissory note and accrued interest was $ 352,945 On February 1, 2021, the Company entered into a securities purchase agreement with an accredited investor and issued an 12 303,000 39,500 February 1, 2022 240,325 23,175 200,000 200,000 42,420 42,420 9,505 2,795,644 1,677 397,657 VERUS INTERNATIONAL, INC. NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS FOR THE SIX MONTHS ENDED APRIL 30, 2022 AND 2021 (UNAUDITED) NOTE 6: DEBT (continued) Revolving Credit Agreement On July 31, 2019, the Company entered into a secured, $ 500,000 Borrowings under the Credit Facility may be used to fund working capital needs and bear interest at a one-month LIBOR-based rate plus 300 basis-points, including a default rate of 500 basis-points ( 8.452 At April 30, 2022, the aggregate balance outstanding under the Credit Facility including accrued interest was $ 457,400 |
DERIVATIVE LIABILITY
DERIVATIVE LIABILITY | 6 Months Ended |
Apr. 30, 2022 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
DERIVATIVE LIABILITY | NOTE 7: DERIVATIVE LIABILITY The Company evaluates its convertible instruments, options, warrants or other contracts to determine if those contracts or embedded components of those contracts qualify as derivatives to be separately accounted for under ASC Topic 815, Derivatives and Hedging The derivative liability is measured at fair value on a recurring basis using significant unobservable inputs (Level 3) from October 31, 2021 to April 30, 2022. SCHEDULE OF DERIVATIVE LIABILITY MEASURED AT FAIR VALUE RECURRING BASIS Conversion feature derivative liability October 31, 2021 $ 471,219 Initial fair value of derivative liability charged to other expense 143,657 Loss on change in fair value included in earnings 55,399 Derivative liability relieved by conversions of convertible promissory notes (147,354 ) April 30, 2022 $ 522,921 VERUS INTERNATIONAL, INC. NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS FOR THE SIX MONTHS ENDED APRIL 30, 2022 AND 2021 (UNAUDITED) NOTE 7: DERIVATIVE LIABILITY (continued) Total derivative liability at April 30, 2022 and October 31, 2021 amounted to $ 522,921 471,219 55,399 0.02 0.003 The Company used the following assumptions for determining the fair value of the convertible instrument granted under the binomial pricing model with a binomial simulation at April 30, 2022: SCHEDULE OF FAIR VALUE ASSUMPTIONS OF DERIVATIVE LIABILITY Expected volatility 243.5 281.6 % Expected term 3.0 6.2 Risk-free interest rate 0.850 1.410 % Stock price $ 0.003 The Company recognizes its derivative liabilities as Level 3 and values its derivatives using the methods discussed above. While the Company believes that its valuation methods are appropriate and consistent with other market participants, it recognizes that the use of different methodologies or assumptions to determine the fair value of certain financial instruments could result in a different estimate of fair value at the reporting date. The primary assumptions that would significantly affect the fair values using the methods discussed are that of volatility and market price of the underlying common stock of the Company. At April 30, 2022, the Company did not have any derivative instruments that were designated as hedges. |
STOCKHOLDERS_ DEFICIT
STOCKHOLDERS’ DEFICIT | 6 Months Ended |
Apr. 30, 2022 | |
Equity [Abstract] | |
STOCKHOLDERS’ DEFICIT | NOTE 8: STOCKHOLDERS’ DEFICIT The total number of shares of all classes of stock that the Company shall have the authority to issue is 7,625,000,000 7,500,000,000 0.000001 87,521,179 125,000,000 0.000001 120,000,000 28,944,601 1,000,000 no 1,000,000 680,801 VERUS INTERNATIONAL, INC. NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS FOR THE SIX MONTHS ENDED APRIL 30, 2022 AND 2021 (UNAUDITED) NOTE 8: STOCKHOLDERS’ DEFICIT (continued) On October 6, 2020, stockholders holding a majority of the voting power of the Company’s issued and outstanding shares of voting stock, executed a written consent approving 1) an amendment to the Company’s Certificate of Incorporation, (the “Certificate of Incorporation”) to effect a consolidation of the issued and outstanding shares of Common Stock, pursuant to which the shares of Common Stock would be combined and reclassified into one share of Common Stock at a ratio of 1-for-500 (the “Reverse Stock Split”) 750,000,000 1,500,000 On November 18, 2020, the Company filed a Certificate of Amendment (the “Amendment”) to its Certificate of Incorporation, to 1) effect a consolidation of the issued and outstanding shares of Common Stock, pursuant to which the shares of Common Stock would be combined and reclassified into one share of Common Stock at a ratio of 1-for-500 (the “Reverse Stock Split”) Common Stock During the six months ended April 30, 2022, the Company: ● issued 63,676,613 529,980 ● recorded 2,724,138 10,000 During the six months ended April 30, 2021, the Company: ● issued 1,998,174 583,310 ● issued 400,000 200,000 200,000 ● issued 67,728 ● recorded 107,364 Common Stock Warrants At April 30, 2022, there were warrants to purchase up to 1,339,114 no 1,280,000 VERUS INTERNATIONAL, INC. NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS FOR THE SIX MONTHS ENDED APRIL 30, 2022 AND 2021 (UNAUDITED) NOTE 8: STOCKHOLDERS’ DEFICIT (continued) The following table sets forth common share purchase warrants outstanding at April 30, 2022: SCHEDULE OF COMMON SHARE PURCHASE WARRANTS OUTSTANDING Weighted Average Exercise Intrinsic Warrants Price Value Outstanding, October 31, 2021 2,619,114 $ 2.24 $ - Warrants granted and issued - $ - $ - Warrants exercised - $ - $ - Warrants forfeited (1,280,000 ) $ 1.41 $ - Outstanding, April 30, 2022 1,339,114 $ 3.03 $ - Common stock issuable upon exercise of warrants 1,339,114 $ 3.03 $ - SCHEDULE OF SHARE-BASED COMPENSATION, ACTIVITY Common Stock Issuable Common Stock Issuable Upon Exercise of Upon Warrants Warrants Outstanding Exercisable Weighted Number Average Weighted Number Weighted Range of Outstanding Remaining Average Exercisable Average Exercise at April 30, Contractual Exercise At April 30, Exercise Prices 2022 Life (Years) Price 2022 Price $ 3.00 1,337,114 0.53 $ 3.00 1,337,114 $ 3.00 $ 25.00 2,000 0.67 $ 25.00 2,000 $ 25.00 1,339,114 0.55 $ 3.03 1,339,114 $ 3.03 |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 6 Months Ended |
Apr. 30, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | NOTE 9: COMMITMENTS AND CONTINGENCIES Contracts and Commitments Executed Pursuant Employment Agreements On February 17, 2021, Apurva Dhruv was appointed as Chief Executive Officer of the Company pursuant to the terms of an employment agreement (the “2021 Employment Agreement”) as approved by the Board of Directors of the Company. On May 18, 2021, Mr. Dhruv was appointed as a member of the Board of Directors and will serve in the role of Chairman of the Board of Directors of the Company. Lease Agreement At January 31, 2022, the Company was party to one operating lease for its corporate office and domestic warehouse operations in Stafford, Texas. The Company incurs rent expense of $ 8,383 |
LITIGATION
LITIGATION | 6 Months Ended |
Apr. 30, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
LITIGATION | NOTE 10: LITIGATION On April 4, 2019, Auctus Fund, LLC (“Auctus”) commenced a lawsuit against the Company in the United States District Court for the District of Massachusetts. On August 27, 2019 the Company filed a motion to dismiss this lawsuit. On September 30, 2019, Auctus responded by filing a First Amended Complaint. The Company then filed a second motion to dismiss on October 24, 2019. On February 25, 2020, the court issued a decision dismissing the securities laws and unjust enrichment and breach of fiduciary duty claims and retaining the breach of contract, breach of covenant of good faith, fraud and deceit, and negligent misrepresentation, and the Massachusetts Consumer Protection Act claims. The Company filed its Answer to the complaint on March 10, 2020. The case remains pending in the District of Massachusetts. This case stems from a securities purchase agreement and convertible note issued in May 2017, a securities purchase agreement and convertible note issued in July 2018, the spin-off of the Company’s real estate division into NestBuilder including the issuance of shares of NestBuilder in the spin-off to the Company’s stockholders and an inducement agreement, release and payoff agreement executed by the parties in February 2019 whereby the Company settled the balance of outstanding amounts owed to Auctus in consideration for cash and shares of NestBuilder. Auctus has requested that the court grant it injunctive and equitable relief and specific performance with respect to the Company’s obligations; determine that the Company is liable for all damages, losses and costs and award Auctus actual losses sustained; award Auctus costs including, but not limited to, costs required to prosecute the action including attorneys’ fees; and punitive damages. The Company intends to continue to defend this matter and although the ultimate outcome cannot be predicted with certainty, based on the current information available, the Company does not believe the ultimate liability, if any, will have a material adverse effect on its financial condition or results of operations. On April 23, 2021, a class action complaint for violation of federal securities laws was filed which names our former Chief Executive Officer, our former Chief Financial Officer, and Verus, as defendants. This class action complaint was filed on behalf of all persons and entities who purchased or otherwise acquired securities of Verus between June 17, 2019 and October 8, 2020. On November 9, 2021 this complaint was dismissed. On November 16, 2021, Fulton Bank, N.A. (“Fulton”) commenced a lawsuit against the Company in the United States Circuit Court for Montgomery County, Maryland as a result of the Company not making required payments under the Credit Facility. The Company intends to defend this matter and although the ultimate outcome cannot be predicted with certainty, an adverse ruling against the Company could have a material adverse effect on its financial condition and results of operations. On December 15, 2021, Donald P. Monaco as trustee of the Donald P. Monaco Insurance Trust, commenced a lawsuit against the Company in the United States Circuit Court for Montgomery County, Maryland as a result of the Company not making required payments under the Monaco Note. The Company intends to defend this matter and although the ultimate outcome cannot be predicted with certainty, an adverse ruling against the Company could have a material adverse effect on its financial condition and results of operations. On February 7, 2022, Indeglia & Carney, LLP, commenced a lawsuit against the Company in the United States Circuit Court for Washington County, Maryland as a result of allegations of the Company not making payment of an outstanding balance due for services rendered. The Company intends to defend this matter and although the ultimate outcome cannot be predicted with certainty, an adverse ruling against the Company could have a material adverse effect on its financial condition and results of operations. On March 10, 2022, AGC Global Solutions, Inc., commenced a lawsuit against the Company in the United States Circuit Court for Montgomery County, Maryland as a result of the Company not making required payments under a promissory note. The Company intends to defend this matter and although the ultimate outcome cannot be predicted with certainty, an adverse ruling against the Company could have a material adverse effect on its financial condition and results of operations. |
DISCONTINUED OPERATIONS
DISCONTINUED OPERATIONS | 6 Months Ended |
Apr. 30, 2022 | |
Discontinued Operations and Disposal Groups [Abstract] | |
DISCONTINUED OPERATIONS | NOTE 11: DISCONTINUED OPERATIONS The Company has classified the operating results and associated assets and liabilities from its BLF subsidiary, of which BLF assets were sold, transferred, and assigned to GOF on December 18, 2020, and from its Verus MENA subsidiary, of which operations as an international supplier of consumer food products ceased during the three months ended October 31, 2021, as discontinued operations in the consolidated financial statements for the three and six months ended April 30, 2022 and 2021. The assets and liabilities associated with discontinued operations included in our consolidated balance sheets were as follows: SCHEDULE OF DISCONTINUED OPERATIONS INCLUDED CONSOLIDATED BALANCE SHEETS AND STATEMENTS OF OPERATIONS April 30, 2022 October 31, 2021 Discontinued Continuing Total Discontinued Continuing Total Assets Current Assets Cash $ 326 $ 6,789 $ 7,115 $ 2,221 $ 66,022 $ 68,243 Accounts receivable, net - 250,618 250,618 - 303,218 303,218 Inventory - 145,129 145,129 - 145,129 145,129 Prepaid expenses - - - 4,084 - 4,084 Other assets - 16,144 16,144 99,669 16,144 115,813 Total Current Assets 326 418,680 419,006 105,974 530,513 636,487 Property and equipment, net - 64,651 64,651 - 85,067 85,067 Operating lease right-of-use asset, net - 152,830 152,830 - 198,637 198,637 Total Assets $ 326 $ 636,161 $ 636,487 $ 105,974 $ 814,217 $ 920,191 Liabilities Current Liabilities Accounts payable and accrued expenses $ 162,752 $ 783,844 $ 946,596 $ 227,338 $ 638,315 $ 865,653 Operating lease liability - 95,115 95,115 - 92,771 92,771 Interest payable - 541,602 541,602 - 368,709 368,709 Due to former officer - 221,586 221,586 - 221,586 221,586 Notes payable - 1,562,985 1,562,985 - 1,533,294 1,533,294 Convertible notes payable, net - 489,909 489,909 - 530,358 530,358 Derivative liability - 522,921 522,921 - 471,219 471,219 Total Current Liabilities 162,752 4,217,962 4,380,714 227,338 3,856,252 4,083,590 Operating lease liability, net of current portion - 57,715 57,715 - 105,866 105,866 Total Liabilities $ 162,752 $ 4,275,677 $ 4,438,429 $ 227,338 $ 3,962,118 $ 4,189,456 VERUS INTERNATIONAL, INC. NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS FOR THE SIX MONTHS ENDED APRIL 30, 2022 AND 2021 (UNAUDITED) NOTE 11: DISCONTINUED OPERATIONS (continued) The revenues and expenses associated with discontinued operations included in our consolidated statements of operations were as follows: Three Months Ended April 30, 2022 2021 Discontinued Continuing Total Discontinued Continuing Total Revenue $ - $ - $ - $ 2,962,836 $ 347,844 $ 3,310,680 Cost of revenue - - - 2,394,853 168,791 2,563,644 Gross Profit - - - 567,984 179,052 747,036 Salaries and benefits - 61,497 61,497 55,997 173,741 229,738 Selling and promotions expense - - - 56,471 - 56,471 Legal and professional fees - 25,000 25,000 6,807 - 6,807 General and administrative 5 135,143 135,148 378,366 203,145 581,511 Total Operating Expenses 5 221,640 221,645 497,642 376,886 874,528 Operating (loss) income (5 ) (221,640 ) (221,645 ) 70,342 (197,834 ) (127,492 ) Other Income (Expense): Interest expense - (102,373 ) (102,373 ) - (80,784 ) (80,784 ) (Loss) Gain on change in fair value of derivative liability - (112,451 ) (112,451 ) - (11,235 ) (11,235 ) Default principal increase on convertible notes payable - (47,100 ) (47,100 ) - - - Amortization of original issue discounts and deferred financing costs - (17,738 ) (17,738 ) - (37,252 ) (37,252 ) Loss on extinguishment and settlement of debt - (4,494 ) (4,494 ) - (34,823 ) (34,823 ) Initial derivative liability expense - - - - (520,701 ) (520,701 ) Gain on settlement of liabilities - - - - 104,774 104,774 Total Other (Expense) Income - (284,156 ) (284,156 ) - (580,021 ) (580,021 ) (Loss) income before income taxes (5 ) (505,796 ) (505,801 ) 70,342 (777,855 ) (707,513 ) Income taxes - - - - - - Net (loss) income $ (5 ) $ (505,796 ) $ (505,801 ) $ 70,342 $ (777,855 ) $ (707,513 ) VERUS INTERNATIONAL, INC. NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS FOR THE SIX MONTHS ENDED APRIL 30, 2022 AND 2021 (UNAUDITED) NOTE 11: DISCONTINUED OPERATIONS (continued) Six Months Ended April 30, 2022 2021 Discontinued Continuing Total Discontinued Continuing Total Revenue $ - $ - $ - $ 6,417,480 $ 347,844 $ 6,765,324 Cost of revenue - - - 5,256,125 168,867 5,424,992 Gross Profit - - - 1,161,355 178,977 1,340,332 Salaries and benefits 11,450 131,953 143,403 101,392 153,960 255,352 Selling and promotions expense - - - 138,501 - 138,501 Legal and professional fees - 75,000 75,000 30,476 - 30,476 General and administrative 29,590 236,683 266,273 797,057 358,481 1,155,538 Total Operating Expenses 41,039 443,637 484,676 1,067,425 512,442 1,579,867 Operating (loss) income (41,039 ) (443,637 ) (484,676 ) 93,930 (333,465 ) (239,535 ) Other Income (Expense): Interest expense - (185,793 ) (185,793 ) - (146,941 ) (146,941 ) (Loss) Gain on change in fair value of derivative liability - (55,399 ) (55,399 ) - 27,972 27,972 Default principal increase on convertible notes payable - (47,100 ) (47,100 ) - - - Amortization of original issue discounts and deferred financing costs - (76,779 ) (76,779 ) - (64,764 ) (64,764 ) Loss on extinguishment and settlement of debt - (115,086 ) (115,086 ) - (34,941 ) (34,941 ) Initial derivative liability expense - (143,657 ) (143,657 ) - (800,213 ) (800,213 ) Gain on settlement of liabilities - - - - 104,774 104,774 Total Other (Expense) Income - (623,814 ) (623,814 ) - (914,113 ) (914,113 ) (Loss) income before income taxes (41,039 ) (1,067,451 ) (1,108,490 ) 93,930 (1,247,578 ) (1,153,648 ) Income taxes - - - - - - Net (loss) income $ (41,039 ) $ (1067,451 ) $ (1,108,490 ) $ 93,930 $ (1,247,578 ) $ (1,153,648 ) |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 6 Months Ended |
Apr. 30, 2022 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | NOTE 12: SUBSEQUENT EVENTS Subsequent to April 30, 2022, an aggregate of 402,744,703 On May 10, 2022, the Company entered into a securities purchase agreement with an accredited investor pursuant to which the Company issued and sold a convertible promissory note in the principal amount of $ 38,750 May 10, 2023 bears interest at a rate of 9 |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 6 Months Ended |
Apr. 30, 2022 | |
Accounting Policies [Abstract] | |
Use of Estimates | Use of Estimates The preparation of unaudited condensed consolidated 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 unaudited condensed consolidated financial statements and reported amounts of revenues and expenses for the reporting period. Actual results could differ from those estimates. If actual results significantly differ from the Company’s estimates, the Company’s financial condition and results of operations could be materially impacted. Significant estimates include the collectability of accounts receivable, valuations of inventory, estimated useful lives of finite-lived intangible assets, accrued expenses, valuation of derivative liabilities, stock-based compensation and the valuation reserve for income taxes. |
Reclassifications | Reclassifications Certain reclassifications of prior period amounts have been made to enhance comparability with the current period unaudited condensed consolidated financial statements, including, but not limited to, presentation of certain items within the unaudited consolidated balance sheets, unaudited statements of operations, unaudited consolidated statements of cash flows, and certain notes to the unaudited condensed consolidated financial statements. These reclassifications had no effect on the previously reported net loss. VERUS INTERNATIONAL, INC. NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS FOR THE SIX MONTHS ENDED APRIL 30, 2022 AND 2021 (UNAUDITED) NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) |
Concentrations of Credit Risk | Concentrations of Credit Risk Credit Risk Financial instruments which potentially subject the Company to concentrations of credit risk consist principally of cash and cash equivalents and accounts receivable. The Company maintains cash and cash equivalents with high-quality financial institutions. Deposits held with the financial institutions may exceed the amount of insurance provided by the Federal Deposit Insurance Corporation on such deposits, but may be redeemed upon demand. The Company performs periodic evaluations of the relative credit standing of the financial institutions. With respect to accounts receivable, the Company monitors the credit quality of its customers as well as maintains an allowance for doubtful accounts for estimated losses resulting from the inability of customers to make required payments. Revenue Risk The Company’s products accounts receivable, net and revenues are geographically concentrated with customers located domestically in the United States. In addition, significant concentrations exist with a limited number of customers. Approximately 36 Supplier Risk The Company purchases substantially all of its products from a limited number suppliers. Increases in the prices of the products which we purchase could adversely affect our operating results if we are unable to offset the effect of these increased costs through price increases, and we can provide no assurance that we will be able to pass along such increased costs to our customers. Furthermore, if we cannot obtain sufficient products or our suppliers cease to be available to us, we could experience shortages in our products or be unable to meet our commitments to customers. Alternative sources of products, if available, may be more expensive. For periods in which the prices are declining, the Company may be required to write down its inventory carrying cost which, depending on the extent of the differences between market price and carrying cost, could have a material adverse effect on the Company’s consolidated results of operations and financial position. |
Cash and Cash Equivalents | Cash and Cash Equivalents For purposes of balance sheet presentation and reporting of cash flows, the Company considers all unrestricted demand deposits, money market funds and highly liquid debt instruments with an original maturity of less than 90 days to be cash and cash equivalents. There were no cash equivalents at April 30, 2022 or October 31, 2021. The Company places its cash and cash equivalents with high-quality financial institutions. At times, balances in the Company’s cash accounts may exceed the Federal Deposit Insurance Corporation (“FDIC”) limit. At April 30, 2022 and October 31, 2021, the Company’s cash balances did not exceed the FDIC limit. VERUS INTERNATIONAL, INC. NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS FOR THE SIX MONTHS ENDED APRIL 30, 2022 AND 2021 (UNAUDITED) NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) |
Accounts Receivable | Accounts Receivable The Company regularly reviews outstanding receivables and provides for estimated losses through an allowance for doubtful accounts. In evaluating the level of established loss reserves, the Company makes judgments regarding its customers’ ability to make required payments, economic events and other factors. As the financial condition of these parties change, circumstances develop or additional information becomes available, adjustments to the allowance for doubtful accounts may be required. The Company maintains reserves for potential credit losses and such losses traditionally have been within its expectations. At April 30, 2022 and October 31, 2021, we determined $ 250,600 198,000 due to the past due status of certain accounts receivable invoices. |
Inventory | Inventory Inventory is stated at the lower of net realizable value or cost, determined on the first-in, first-out basis. Net realizable value is based on estimated selling prices in the ordinary course of business less reasonably predictable costs of completion and transportation. Inventories consist of finished products. |
Property and Equipment | Property and Equipment All expenditures on the acquisition for property and equipment are recorded at cost and capitalized as incurred, provided the asset benefits the Company for a period of more than one year. Expenditures on routine repairs and maintenance of property and equipment are charged directly to operating expense. The property and equipment is depreciated based upon its estimated useful life after being placed in service. Leasehold improvements are depreciated based upon the remaining term of the related lease. The estimated useful lives range from 3 7 |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets In accordance with Accounting Standards Codification (“ASC”) 360-10, “Property, Plant, and Equipment”, the Company periodically reviews its long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets may not be fully recoverable. The Company recognizes an impairment loss when the sum of expected undiscounted future cash flows is less than the carrying amount of the asset. The amount of impairment is measured as the difference between the asset’s estimated fair value and its book value. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Company measures its financial instruments in accordance with ASC topic 820, “Fair Value Measurements and Disclosures” (“ASC 820”), formerly SFAS No. 157 “Fair Value Measurements”. ASC 820 defines “fair value” as the price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. VERUS INTERNATIONAL, INC. NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS FOR THE SIX MONTHS ENDED APRIL 30, 2022 AND 2021 (UNAUDITED) NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) ASC 820 also describes three levels of inputs that may be used to measure fair value: Level 1: Observable inputs that reflect unadjusted quoted prices for identical assets or liabilities traded in active markets. Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. Level 3: Inputs that are generally unobservable. These inputs may be used with internally developed methodologies that result in management’s best estimate of fair value. Financial instruments consist principally of cash, accounts receivable, prepaid expenses, accounts payable, accrued liabilities and other current liabilities. The carrying amounts of such financial instruments in the accompanying balance sheets approximate their fair values due to their relatively short-term nature. The fair value of short and long-term debt is based on current rates at which the Company could borrow funds with similar remaining maturities. The carrying amounts approximate fair value. It is management’s opinion that the Company is not exposed to any significant currency or credit risks arising from these financial instruments. At April 30, 2022, the Company had a Level 3 financial instrument related to its derivative liability. |
Revenue Recognition | Revenue Recognition The Company recognizes revenue in accordance with the Financial Accounting Standards Board’s (“FASB”), Accounting Standards Codification (“ASC”) ASC 606, Revenue from Contracts with Customers (“ASC 606”). Revenues are recognized when control is transferred to customers in amounts that reflect the consideration the Company expects to be entitled to receive in exchange for those goods. Revenue recognition is evaluated through the following five steps: (i) identification of the contract, or contracts, with a customer; (ii) identification of the performance obligations in the contract; (iii) determination of the transaction price; (iv) allocation of the transaction price to the performance obligations in the contract; and (v) recognition of revenue when or as a performance obligation is satisfied. Revenue is derived from the sale of consumable and non-consumable products. The Company recognizes revenue when obligations under the terms of a contract with the customer are satisfied. Product sales occur once control is transferred upon delivery to the customer. Revenue is measured as the amount of consideration the Company expects to receive in exchange for transferring products. The amount of consideration the Company receives and revenue the Company recognizes varies with changes in customer incentives the Company offers to its customers and their customers. In the event any discounts, sales incentives, or similar arrangements are agreed to with a customer, such amounts are estimated at time of sale and deducted from revenue. Sales taxes and other similar taxes are excluded from revenue (see Note 5). A contract asset is recognized for incremental costs to obtain a customer contract that are recoverable, otherwise such incremental costs are expensed as incurred. |
Cost of Revenues | Cost of Revenues Cost of revenues represents the cost of the products sold during the periods presented. |
Shipping and Handling Costs | Shipping and Handling Costs Shipping and handling costs for freight expense on goods shipped are included in cost of sales. For the six months ended April 30, 2022 and 2021 there was no freight expense on goods shipped as the operating results and associated assets and liabilities from BLF and Verus MENA have been classified as discontinued operations in the consolidated financial statements for the three months ended October 31, 2022 and 2021 (see Note 11). VERUS INTERNATIONAL, INC. NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS FOR THE SIX MONTHS ENDED APRIL 30, 2022 AND 2021 (UNAUDITED) NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) |
Customer Deposits | Customer Deposits From time to time the Company requires prepayments for deposits in advance of delivery of products. Such amounts are initially recorded as customer deposits. The Company recognizes such revenue as it is earned in accordance with revenue recognition policies. |
Share-Based Compensation | Share-Based Compensation The Company computes share based payments in accordance with the provisions of ASC Topic 718, Compensation – Stock Compensation |
Derivative Instruments | Derivative Instruments The Company accounts for financing arrangements that consist of freestanding derivative instruments or are hybrid instruments that contain embedded derivative features. The Company accounts for these arrangements in accordance with ASC Topic 815, Accounting for Derivative Instruments and Hedging Activities The Company estimates fair values of derivative financial instruments using various techniques (and combinations thereof) that are considered consistent with the objective measuring fair values. In selecting the appropriate technique, the Company considers, among other factors, the nature of the instrument, the market risks that it embodies and the expected means of settlement. Estimating fair values of derivative financial instruments requires the development of significant and subjective estimates that may, and are likely to, change over the duration of the instrument with related changes in internal and external market factors. In addition, option-based techniques (such as Black-Scholes model) are highly volatile and sensitive to changes in the trading market price of the Company’s common stock. Since derivative financial instruments are initially and subsequently carried at fair values, our income (expense) going forward will reflect the volatility in these estimates and assumption changes. |
Convertible Debt Instruments | Convertible Debt Instruments The Company records debt net of debt discount for beneficial conversion features and warrants, on a relative fair value basis. Beneficial conversion features are recorded pursuant to the Beneficial Conversion and Debt Topics of the Financial Accounting Standards Board (“FASB”) ASC. The amounts allocated to warrants and beneficial conversion rights are recorded as debt discount and as additional paid-in-capital. Debt discount is amortized to interest expense over the life of the debt using the effective interest method. VERUS INTERNATIONAL, INC. NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS FOR THE SIX MONTHS ENDED APRIL 30, 2022 AND 2021 (UNAUDITED) NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) |
Foreign Currency Translation | Foreign Currency Translation Through October 31, 2021, the Company had one non-U.S. subsidiary, where the functional currency was the United Arab Emirates dirham (“AED”). The Company’s foreign subsidiary maintained its records using local currency. The related assets and liabilities of this non-U.S. subsidiary have been translated using end of period exchange rates and stockholders’ equity is translated at the historical exchange rates to the U.S. dollar. Income and expense items were translated using average exchange rates for the period. The resulting translation adjustments, net of income taxes, are reported as other comprehensive income and accumulated other comprehensive income in the stockholder’s equity in accordance with ASC 220 – Comprehensive Income. The exchange rate used to translate amounts in AED into USD for the purposes of preparing the unaudited condensed consolidated financial statements were as follows: SCHEDULE OF FOREIGN CURRENCY TRANSLATION OF EXCHANGE RATES Balance sheet: April 30, 2022 October 31, 2021 Period-end AED: USD exchange rate $ 0.27229 $ 0.27230 Income statement: For the Three Months Ended For the Six Months Ended April 30, April 30, 2022 2021 2022 2021 Average Period AED: USD exchange rate $ 0.27229 $ 0.27228 $ 0.27229 $ 0.27228 Translation gains and losses that arise from exchange rate fluctuations from transactions denominated in a currency other than the functional currency are translated, as the case may be, at the rate on the date of the transaction and included in the results of operations as incurred. |
Income Taxes | Income Taxes The Company accounts for income taxes in accordance with Accounting for Income Taxes, as clarified by ASC 740-10, Accounting for Uncertainty in Income Taxes ASC 740 requires that the Company recognize the financial statement benefit of a tax position only after determining that the relevant tax authority would more likely than not sustain the position following an audit. For tax positions meeting the “more-likely-than-not” threshold, the amount recognized in the consolidated financial statements is the largest benefit that has a greater than 50 percent likelihood of being realized upon ultimate settlement with the relevant tax authority. The Company’s tax returns for its October 31, 2021, 2020, 2019, and 2018 tax years may be selected for examination by the taxing authorities as the statute of limitations remains open. The Company recognizes expenses for tax penalties and interest assessed by the Internal Revenue Service and other taxing authorities upon receiving valid notice of assessments. The Company has received no such notices for the tax years ended October 31, 2021 and 2020. VERUS INTERNATIONAL, INC. NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS FOR THE SIX MONTHS ENDED APRIL 30, 2022 AND 2021 (UNAUDITED) NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) |
Earnings Per Share | Earnings Per Share In accordance with the provisions of FASB ASC Topic 260, Earnings per Share In computing diluted EPS, only potential common shares that are dilutive, those that reduce EPS or increase loss per share, are included. The effect of contingently issuable shares are not included if the result would be anti-dilutive, such as when a net loss is reported. Therefore, basic and diluted EPS are computed using the same number of weighted average shares for the three and six months ended April 30, 2022 and 2021, as we incurred a net loss for those periods. At April 30, 2022, there were outstanding warrants to purchase approximately 1,340,000 194,000 2,900,000 546,000,000 2,620,000 194,000 107,000 5,400,000 |
Modification/Extinguishment of Debt | Modification/Extinguishment of Debt In accordance with ASC 470, a modification or an exchange of debt instruments that adds or eliminates a conversion option that was substantive at the date of the modification or exchange is considered a substantive change and is measured and accounted for as extinguishment of the original instrument along with the recognition of a gain or loss. Additionally, under ASC 470, a substantive modification of a debt instrument is deemed to have been accomplished with debt instruments that are substantially different if the present value of the cash flows under the terms of the new debt instrument is at least 10 percent different from the present value of the remaining cash flows under the terms of the original instrument. A substantive modification is accounted for as an extinguishment of the original instrument along with the recognition of a gain or loss. |
Concentrations, Risks and Uncertainties | Concentrations, Risks and Uncertainties A significant portion of the Company’s ongoing operations are related to the nutraceutical products industry, and its prospects for success are tied indirectly to interest rates and the worldwide demand for the Company’s nutraceutical products. |
Recently Adopted Accounting Standards | Recently Adopted Accounting Standards Effective November 1, 2021, the Company adopted ASU 2019-12, Income Taxes (Topic 740) VERUS INTERNATIONAL, INC. NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS FOR THE SIX MONTHS ENDED APRIL 30, 2022 AND 2021 (UNAUDITED) NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) |
Recently Issued Accounting Standards Not Yet Adopted | Recently Issued Accounting Standards Not Yet Adopted During May 2021, the FASB issued ASU 2021-04, to clarify and reduce diversity in accounting for modifications or exchanges of freestanding equity-classified written call options that remain equity classified after modification or exchange. The standard is effective for the Company as of November 1, 2022, with early adoption permitted. The Company is reviewing the impact of this guidance but does not currently expect the adoption of this guidance to have a material impact on its consolidated financial statements. During August 2020, the FASB issued ASU 2020-06, to modify and simplify the application of U.S. GAAP for certain financial instruments with characteristics of liabilities and equity. The standard is effective for the Company as of November 1, 2024, with early adoption permitted. The Company is reviewing the impact of this guidance but does not currently expect the adoption of this guidance to have a material impact on its consolidated financial statements. Management does not believe that any other recently issued, but not yet effective accounting pronouncements, if adopted, would have a material impact on the accompanying unaudited condensed consolidated financial statements. |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 6 Months Ended |
Apr. 30, 2022 | |
Accounting Policies [Abstract] | |
SCHEDULE OF FOREIGN CURRENCY TRANSLATION OF EXCHANGE RATES | The exchange rate used to translate amounts in AED into USD for the purposes of preparing the unaudited condensed consolidated financial statements were as follows: SCHEDULE OF FOREIGN CURRENCY TRANSLATION OF EXCHANGE RATES Balance sheet: April 30, 2022 October 31, 2021 Period-end AED: USD exchange rate $ 0.27229 $ 0.27230 Income statement: For the Three Months Ended For the Six Months Ended April 30, April 30, 2022 2021 2022 2021 Average Period AED: USD exchange rate $ 0.27229 $ 0.27228 $ 0.27229 $ 0.27228 |
LEASES (Tables)
LEASES (Tables) | 6 Months Ended |
Apr. 30, 2022 | |
Leases | |
SCHEDULE OF FUTURE MINIMUM LEASE PAYMENTS | SCHEDULE OF FUTURE MINIMUM LEASE PAYMENTS Future Minimum Lease Payments: Remainder of fiscal year 2022 $ 50,298 2023 100,596 2024 8,383 Total Minimum Lease Payments $ 159,277 Less: amount representing interest (6,447 ) Present Value of Lease Liabilities $ 152,830 Less: current portion (95,115 ) Long-Term Portion $ 57,715 |
DERIVATIVE LIABILITY (Tables)
DERIVATIVE LIABILITY (Tables) | 6 Months Ended |
Apr. 30, 2022 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
SCHEDULE OF DERIVATIVE LIABILITY MEASURED AT FAIR VALUE RECURRING BASIS | The derivative liability is measured at fair value on a recurring basis using significant unobservable inputs (Level 3) from October 31, 2021 to April 30, 2022. SCHEDULE OF DERIVATIVE LIABILITY MEASURED AT FAIR VALUE RECURRING BASIS Conversion feature derivative liability October 31, 2021 $ 471,219 Initial fair value of derivative liability charged to other expense 143,657 Loss on change in fair value included in earnings 55,399 Derivative liability relieved by conversions of convertible promissory notes (147,354 ) April 30, 2022 $ 522,921 |
SCHEDULE OF FAIR VALUE ASSUMPTIONS OF DERIVATIVE LIABILITY | The Company used the following assumptions for determining the fair value of the convertible instrument granted under the binomial pricing model with a binomial simulation at April 30, 2022: SCHEDULE OF FAIR VALUE ASSUMPTIONS OF DERIVATIVE LIABILITY Expected volatility 243.5 281.6 % Expected term 3.0 6.2 Risk-free interest rate 0.850 1.410 % Stock price $ 0.003 |
STOCKHOLDERS_ DEFICIT (Tables)
STOCKHOLDERS’ DEFICIT (Tables) | 6 Months Ended |
Apr. 30, 2022 | |
Equity [Abstract] | |
SCHEDULE OF COMMON SHARE PURCHASE WARRANTS OUTSTANDING | The following table sets forth common share purchase warrants outstanding at April 30, 2022: SCHEDULE OF COMMON SHARE PURCHASE WARRANTS OUTSTANDING Weighted Average Exercise Intrinsic Warrants Price Value Outstanding, October 31, 2021 2,619,114 $ 2.24 $ - Warrants granted and issued - $ - $ - Warrants exercised - $ - $ - Warrants forfeited (1,280,000 ) $ 1.41 $ - Outstanding, April 30, 2022 1,339,114 $ 3.03 $ - Common stock issuable upon exercise of warrants 1,339,114 $ 3.03 $ - |
SCHEDULE OF SHARE-BASED COMPENSATION, ACTIVITY | SCHEDULE OF SHARE-BASED COMPENSATION, ACTIVITY Common Stock Issuable Common Stock Issuable Upon Exercise of Upon Warrants Warrants Outstanding Exercisable Weighted Number Average Weighted Number Weighted Range of Outstanding Remaining Average Exercisable Average Exercise at April 30, Contractual Exercise At April 30, Exercise Prices 2022 Life (Years) Price 2022 Price $ 3.00 1,337,114 0.53 $ 3.00 1,337,114 $ 3.00 $ 25.00 2,000 0.67 $ 25.00 2,000 $ 25.00 1,339,114 0.55 $ 3.03 1,339,114 $ 3.03 |
DISCONTINUED OPERATIONS (Tables
DISCONTINUED OPERATIONS (Tables) | 6 Months Ended |
Apr. 30, 2022 | |
Discontinued Operations and Disposal Groups [Abstract] | |
SCHEDULE OF DISCONTINUED OPERATIONS INCLUDED CONSOLIDATED BALANCE SHEETS AND STATEMENTS OF OPERATIONS | The assets and liabilities associated with discontinued operations included in our consolidated balance sheets were as follows: SCHEDULE OF DISCONTINUED OPERATIONS INCLUDED CONSOLIDATED BALANCE SHEETS AND STATEMENTS OF OPERATIONS April 30, 2022 October 31, 2021 Discontinued Continuing Total Discontinued Continuing Total Assets Current Assets Cash $ 326 $ 6,789 $ 7,115 $ 2,221 $ 66,022 $ 68,243 Accounts receivable, net - 250,618 250,618 - 303,218 303,218 Inventory - 145,129 145,129 - 145,129 145,129 Prepaid expenses - - - 4,084 - 4,084 Other assets - 16,144 16,144 99,669 16,144 115,813 Total Current Assets 326 418,680 419,006 105,974 530,513 636,487 Property and equipment, net - 64,651 64,651 - 85,067 85,067 Operating lease right-of-use asset, net - 152,830 152,830 - 198,637 198,637 Total Assets $ 326 $ 636,161 $ 636,487 $ 105,974 $ 814,217 $ 920,191 Liabilities Current Liabilities Accounts payable and accrued expenses $ 162,752 $ 783,844 $ 946,596 $ 227,338 $ 638,315 $ 865,653 Operating lease liability - 95,115 95,115 - 92,771 92,771 Interest payable - 541,602 541,602 - 368,709 368,709 Due to former officer - 221,586 221,586 - 221,586 221,586 Notes payable - 1,562,985 1,562,985 - 1,533,294 1,533,294 Convertible notes payable, net - 489,909 489,909 - 530,358 530,358 Derivative liability - 522,921 522,921 - 471,219 471,219 Total Current Liabilities 162,752 4,217,962 4,380,714 227,338 3,856,252 4,083,590 Operating lease liability, net of current portion - 57,715 57,715 - 105,866 105,866 Total Liabilities $ 162,752 $ 4,275,677 $ 4,438,429 $ 227,338 $ 3,962,118 $ 4,189,456 VERUS INTERNATIONAL, INC. NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS FOR THE SIX MONTHS ENDED APRIL 30, 2022 AND 2021 (UNAUDITED) NOTE 11: DISCONTINUED OPERATIONS (continued) The revenues and expenses associated with discontinued operations included in our consolidated statements of operations were as follows: Three Months Ended April 30, 2022 2021 Discontinued Continuing Total Discontinued Continuing Total Revenue $ - $ - $ - $ 2,962,836 $ 347,844 $ 3,310,680 Cost of revenue - - - 2,394,853 168,791 2,563,644 Gross Profit - - - 567,984 179,052 747,036 Salaries and benefits - 61,497 61,497 55,997 173,741 229,738 Selling and promotions expense - - - 56,471 - 56,471 Legal and professional fees - 25,000 25,000 6,807 - 6,807 General and administrative 5 135,143 135,148 378,366 203,145 581,511 Total Operating Expenses 5 221,640 221,645 497,642 376,886 874,528 Operating (loss) income (5 ) (221,640 ) (221,645 ) 70,342 (197,834 ) (127,492 ) Other Income (Expense): Interest expense - (102,373 ) (102,373 ) - (80,784 ) (80,784 ) (Loss) Gain on change in fair value of derivative liability - (112,451 ) (112,451 ) - (11,235 ) (11,235 ) Default principal increase on convertible notes payable - (47,100 ) (47,100 ) - - - Amortization of original issue discounts and deferred financing costs - (17,738 ) (17,738 ) - (37,252 ) (37,252 ) Loss on extinguishment and settlement of debt - (4,494 ) (4,494 ) - (34,823 ) (34,823 ) Initial derivative liability expense - - - - (520,701 ) (520,701 ) Gain on settlement of liabilities - - - - 104,774 104,774 Total Other (Expense) Income - (284,156 ) (284,156 ) - (580,021 ) (580,021 ) (Loss) income before income taxes (5 ) (505,796 ) (505,801 ) 70,342 (777,855 ) (707,513 ) Income taxes - - - - - - Net (loss) income $ (5 ) $ (505,796 ) $ (505,801 ) $ 70,342 $ (777,855 ) $ (707,513 ) VERUS INTERNATIONAL, INC. NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS FOR THE SIX MONTHS ENDED APRIL 30, 2022 AND 2021 (UNAUDITED) NOTE 11: DISCONTINUED OPERATIONS (continued) Six Months Ended April 30, 2022 2021 Discontinued Continuing Total Discontinued Continuing Total Revenue $ - $ - $ - $ 6,417,480 $ 347,844 $ 6,765,324 Cost of revenue - - - 5,256,125 168,867 5,424,992 Gross Profit - - - 1,161,355 178,977 1,340,332 Salaries and benefits 11,450 131,953 143,403 101,392 153,960 255,352 Selling and promotions expense - - - 138,501 - 138,501 Legal and professional fees - 75,000 75,000 30,476 - 30,476 General and administrative 29,590 236,683 266,273 797,057 358,481 1,155,538 Total Operating Expenses 41,039 443,637 484,676 1,067,425 512,442 1,579,867 Operating (loss) income (41,039 ) (443,637 ) (484,676 ) 93,930 (333,465 ) (239,535 ) Other Income (Expense): Interest expense - (185,793 ) (185,793 ) - (146,941 ) (146,941 ) (Loss) Gain on change in fair value of derivative liability - (55,399 ) (55,399 ) - 27,972 27,972 Default principal increase on convertible notes payable - (47,100 ) (47,100 ) - - - Amortization of original issue discounts and deferred financing costs - (76,779 ) (76,779 ) - (64,764 ) (64,764 ) Loss on extinguishment and settlement of debt - (115,086 ) (115,086 ) - (34,941 ) (34,941 ) Initial derivative liability expense - (143,657 ) (143,657 ) - (800,213 ) (800,213 ) Gain on settlement of liabilities - - - - 104,774 104,774 Total Other (Expense) Income - (623,814 ) (623,814 ) - (914,113 ) (914,113 ) (Loss) income before income taxes (41,039 ) (1,067,451 ) (1,108,490 ) 93,930 (1,247,578 ) (1,153,648 ) Income taxes - - - - - - Net (loss) income $ (41,039 ) $ (1067,451 ) $ (1,108,490 ) $ 93,930 $ (1,247,578 ) $ (1,153,648 ) |
NATURE OF BUSINESS AND BASIS _2
NATURE OF BUSINESS AND BASIS OF PRESENTATION (Details Narrative) - shares | 6 Months Ended | 12 Months Ended | ||||
Jan. 13, 2021 | Oct. 06, 2020 | May 02, 2018 | Apr. 30, 2022 | Oct. 31, 2021 | Oct. 09, 2012 | |
Stockholders' equity, reverse stock split | adjusted to reflect a 1-for-500 reverse stock split | Common Stock at a ratio of 1-for-500 (the “Reverse Stock Split”) | 1-for-500 reverse stock split | 1-for-500 reverse stock split | ||
Owned percentage | 80% | |||||
Verus Foods MENA Limited [Member] | ||||||
Number of shares issued in exchange transaction | 75 | |||||
Percentage for common stock ownership in exchange | 25% | |||||
Series A Convertible Preferred Stock [Member] | ||||||
Preferred stock, designated shares | 120,000,000 | 120,000,000 | 93,000,000 |
SCHEDULE OF FOREIGN CURRENCY TR
SCHEDULE OF FOREIGN CURRENCY TRANSLATION OF EXCHANGE RATES (Details) - United Arab Emirates, Dirhams | 3 Months Ended | 6 Months Ended | |||
Apr. 30, 2022 | Apr. 30, 2021 | Apr. 30, 2022 | Apr. 30, 2021 | Oct. 31, 2021 | |
Period-End [Member] | |||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||||
Foreign currency exchange rate | 0.27229 | 0.27229 | 0.27230 | ||
Average Period [Member] | |||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||||
Foreign currency exchange rate, average period | 0.27229 | 0.27228 | 0.27229 | 0.27228 |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($) | 6 Months Ended | 12 Months Ended | |
Apr. 30, 2022 | Apr. 30, 2021 | Oct. 31, 2021 | |
Product Information [Line Items] | |||
Allowance for doubtful accounts | $ 52,600 | ||
Warrant [Member] | |||
Product Information [Line Items] | |||
Warrants outstanding | 1,340,000 | 2,620,000 | |
Conversion of Series A and Series C Convertible Preferred Stock [Member] | |||
Product Information [Line Items] | |||
Conversion of convertible notes payable | 194,000 | 194,000 | |
Convertible Notes Payable [Member] | |||
Product Information [Line Items] | |||
Conversion of convertible notes payable, Shares to be issued | 2,900,000 | ||
Conversion of convertible notes payable | 546,000,000 | 107,000 | |
Convertible Notes Payable One [Member] | |||
Product Information [Line Items] | |||
Conversion of convertible notes payable | 5,400,000 | ||
Minimum [Member] | |||
Product Information [Line Items] | |||
Estimated useful life of property and equipment | 3 years | ||
Maximum [Member] | |||
Product Information [Line Items] | |||
Estimated useful life of property and equipment | 7 years | ||
Accounts Receivable [Member] | |||
Product Information [Line Items] | |||
Allowance for doubtful accounts | $ 250,600 | $ 198,000 | |
Accounts Receivable [Member] | Customer Concentration Risk [Member] | Two Customers [Member] | |||
Product Information [Line Items] | |||
Concentration risk percentage | 36% |
GOING CONCERN (Details Narrativ
GOING CONCERN (Details Narrative) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Apr. 30, 2022 | Apr. 30, 2021 | Apr. 30, 2022 | Apr. 30, 2021 | Oct. 31, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||
Net loss from continuing operations | $ 505,796 | $ 777,854 | $ 1,067,451 | $ 1,247,578 | |
Net used cash in operating activities of continuing operations | 220,295 | $ 597,055 | |||
Working capital | 3,961,708 | 3,961,708 | |||
Accumulated deficit | $ 51,272,169 | $ 51,272,169 | $ 50,163,679 |
SCHEDULE OF FUTURE MINIMUM LEAS
SCHEDULE OF FUTURE MINIMUM LEASE PAYMENTS (Details) - USD ($) | Apr. 30, 2022 | Oct. 31, 2021 |
Leases | ||
Remainder of fiscal year 2022 | $ 50,298 | |
2023 | 100,596 | |
2024 | 8,383 | |
Total Minimum Lease Payments | 159,277 | |
Less: amount representing interest | (6,447) | |
Present Value of Lease Liabilities | 152,830 | |
Less: current portion | (95,115) | $ (92,771) |
Long-Term Portion | $ 57,715 | $ 105,866 |
LEASES (Details Narrative)
LEASES (Details Narrative) | 6 Months Ended |
Apr. 30, 2022 USD ($) | |
Leases | |
Operating lease cost | $ 50,298 |
Operating lease cash payments | 16,900 |
Operating lease costs future payment | $ 42,327 |
Weighted average remaining lease term | 19 months |
Operating lease discount rate | 5% |
REVENUE DISAGGREGATION (Details
REVENUE DISAGGREGATION (Details Narrative) | 6 Months Ended |
Apr. 30, 2021 | |
Revenue Benchmark [Member] | Customer Concentration Risk [Member] | Two Customers [Member] | |
Disaggregation of Revenue [Line Items] | |
Concentration risk percentage | 29% |
DEBT (Details Narrative)
DEBT (Details Narrative) - USD ($) | 3 Months Ended | 6 Months Ended | ||||||||||||||||||||||
Apr. 29, 2022 | Apr. 25, 2022 | Apr. 25, 2022 | Dec. 10, 2021 | Nov. 05, 2021 | Nov. 02, 2021 | Aug. 12, 2021 | Aug. 05, 2021 | Jun. 29, 2021 | Apr. 15, 2021 | Apr. 08, 2021 | Apr. 07, 2021 | Feb. 08, 2021 | Feb. 02, 2021 | Mar. 31, 2020 | Jul. 31, 2019 | Feb. 08, 2019 | Jan. 26, 2019 | Apr. 30, 2022 | Apr. 30, 2021 | Apr. 30, 2022 | Apr. 30, 2021 | Oct. 31, 2021 | Nov. 08, 2019 | |
Short-Term Debt [Line Items] | ||||||||||||||||||||||||
Loss on extinguishment and settlement of debt | $ (4,494) | $ (34,823) | $ (115,086) | $ (34,941) | ||||||||||||||||||||
Debt discount | 11,141 | 11,141 | $ 42,442 | |||||||||||||||||||||
Convertible notes payable outstanding | 489,909 | 489,909 | $ 530,358 | |||||||||||||||||||||
Amortization of discounts and debt issuance costs | 38,801 | 38,753 | ||||||||||||||||||||||
Payments of debt | 91,457 | |||||||||||||||||||||||
Proceeds from note payable | 240,325 | |||||||||||||||||||||||
Revolving Credit Agreement [Member] | ||||||||||||||||||||||||
Short-Term Debt [Line Items] | ||||||||||||||||||||||||
Credit facility | $ 500,000 | |||||||||||||||||||||||
LIBOR-based rate, description | Borrowings under the Credit Facility may be used to fund working capital needs and bear interest at a one-month LIBOR-based rate plus 300 basis-points, including a default rate of 500 basis-points (8.452% at April 30, 2022) | |||||||||||||||||||||||
Credit facility, percentage | 8.452% | |||||||||||||||||||||||
Credit facility, outstanding | 457,400 | $ 457,400 | ||||||||||||||||||||||
Fourth Note Amendment [Member] | ||||||||||||||||||||||||
Short-Term Debt [Line Items] | ||||||||||||||||||||||||
Interest payable | 116,152 | 116,152 | ||||||||||||||||||||||
Donald P. Monaco Insurance Trust [Member] | ||||||||||||||||||||||||
Short-Term Debt [Line Items] | ||||||||||||||||||||||||
Note interest rate | 18% | |||||||||||||||||||||||
Donald P. Monaco Insurance Trust [Member] | Fourth Note Amendment [Member] | ||||||||||||||||||||||||
Short-Term Debt [Line Items] | ||||||||||||||||||||||||
Interest payable | 851,298 | 851,298 | ||||||||||||||||||||||
Convertible Promissory Notes One [Member] | ||||||||||||||||||||||||
Short-Term Debt [Line Items] | ||||||||||||||||||||||||
Note interest rate | 24% | |||||||||||||||||||||||
Convertible Note [Member] | ||||||||||||||||||||||||
Short-Term Debt [Line Items] | ||||||||||||||||||||||||
Value of debt converted into share | 258,034 | $ 320,131 | ||||||||||||||||||||||
Accredited Investor [Member] | ||||||||||||||||||||||||
Short-Term Debt [Line Items] | ||||||||||||||||||||||||
Note interest rate | 24% | |||||||||||||||||||||||
Accredited Investor [Member] | Convertible Promissory Note [Member] | ||||||||||||||||||||||||
Short-Term Debt [Line Items] | ||||||||||||||||||||||||
Convertible promissory note and accrued interest | $ 69,286 | $ 69,286 | 91,804 | 91,804 | ||||||||||||||||||||
Debt instrument conversion of shares | 13,475,052 | |||||||||||||||||||||||
Loss on extinguishment and settlement of debt | $ 26,605 | |||||||||||||||||||||||
Original issue discount and deferred financing costs | 91,804 | 91,804 | ||||||||||||||||||||||
Accredited Investor [Member] | Convertible Promissory Notes One [Member] | ||||||||||||||||||||||||
Short-Term Debt [Line Items] | ||||||||||||||||||||||||
Debt principal amount | $ 150,000 | |||||||||||||||||||||||
Note interest rate, description | bears interest at a rate of 8% per annum (increasing to 24% per annum upon the occurrence of an Event of Default (as defined in the note)) | |||||||||||||||||||||||
Note interest rate | 8% | |||||||||||||||||||||||
Debt discount | $ 20,000 | |||||||||||||||||||||||
Debt instrument, maturity date | Apr. 08, 2022 | |||||||||||||||||||||||
Conversion of debenture convertion percentage | 60% | |||||||||||||||||||||||
Original issue discount and deferred financing costs | $ 5,200 | |||||||||||||||||||||||
Accredited Investor [Member] | Convetible Promissory Notes Two [Member] | ||||||||||||||||||||||||
Short-Term Debt [Line Items] | ||||||||||||||||||||||||
Debt principal amount | $ 143,000 | |||||||||||||||||||||||
Note interest rate, description | bears interest at a rate of 6% per annum (increasing to 24% per annum upon the occurrence of an Event of Default (as defined in the note)) | |||||||||||||||||||||||
Note interest rate | 6% | |||||||||||||||||||||||
Convertible promissory note and accrued interest | $ 81,765 | 72,105 | 72,105 | |||||||||||||||||||||
Debt instrument conversion of shares | 22,203,195 | |||||||||||||||||||||||
Loss on extinguishment and settlement of debt | $ 26,529 | |||||||||||||||||||||||
Debt discount | $ 13,000 | |||||||||||||||||||||||
Debt instrument, maturity date | Apr. 15, 2022 | |||||||||||||||||||||||
Conversion of debenture convertion percentage | 60% | |||||||||||||||||||||||
Contract with Customer, Liability | $ 238,200 | $ 282,500 | ||||||||||||||||||||||
Original issue discount and deferred financing costs | $ 11,700 | 72,105 | 72,105 | |||||||||||||||||||||
Accredited Investor [Member] | Convertible Promissory Notes Five [Member] | ||||||||||||||||||||||||
Short-Term Debt [Line Items] | ||||||||||||||||||||||||
Debt principal amount | $ 110,000 | |||||||||||||||||||||||
Note interest rate, description | bears interest at a rate of 6% per annum (increasing to 24% per annum upon the occurrence of an Event of Default (as defined in the note)) | |||||||||||||||||||||||
Convertible promissory note and accrued interest | 118,752 | 118,752 | ||||||||||||||||||||||
Debt discount | $ 10,000 | |||||||||||||||||||||||
Debt instrument, maturity date | Aug. 12, 2022 | |||||||||||||||||||||||
Conversion of debenture convertion percentage | 60% | |||||||||||||||||||||||
Contract with Customer, Liability | $ 226,620 | |||||||||||||||||||||||
Original issue discount and deferred financing costs | $ 8,800 | 104,695 | 104,695 | |||||||||||||||||||||
Accredited Investor [Member] | Convertible Promissory Notes Six [Member] | ||||||||||||||||||||||||
Short-Term Debt [Line Items] | ||||||||||||||||||||||||
Note interest rate | 6% | |||||||||||||||||||||||
Accredited Investor [Member] | Promissory Note [Member] | ||||||||||||||||||||||||
Short-Term Debt [Line Items] | ||||||||||||||||||||||||
Debt principal amount | $ 312,500 | |||||||||||||||||||||||
Note interest rate, description | incurred interest at a rate of 4% per annum, (increasing to 18% per annum upon the occurrence of an Event of Default (as defined in the note)) | |||||||||||||||||||||||
Debt discount | $ 62,500 | |||||||||||||||||||||||
Debt instrument, maturity date | Jul. 01, 2020 | |||||||||||||||||||||||
Proceeds from note payable | $ 150,000 | |||||||||||||||||||||||
Accredited Investor [Member] | Promissory Note [Member] | AGC Global Solutions Inc [Member] | ||||||||||||||||||||||||
Short-Term Debt [Line Items] | ||||||||||||||||||||||||
Convertible promissory note and accrued interest | 352,945 | 352,945 | ||||||||||||||||||||||
Accredited Investor [Member] | Convetible Promissory Notes One [Member] | ||||||||||||||||||||||||
Short-Term Debt [Line Items] | ||||||||||||||||||||||||
Note interest rate | 4% | |||||||||||||||||||||||
Accredited Investor [Member] | Promissory Notes [Member] | ||||||||||||||||||||||||
Short-Term Debt [Line Items] | ||||||||||||||||||||||||
Note interest rate | 18% | |||||||||||||||||||||||
Securities Purchase Agreement [Member] | Accredited Investor [Member] | Convertible Promissory Note [Member] | ||||||||||||||||||||||||
Short-Term Debt [Line Items] | ||||||||||||||||||||||||
Debt principal amount | $ 88,500 | |||||||||||||||||||||||
Note interest rate, description | bears interest at a rate of 9% per annum (increasing to 22% per annum upon the occurrence of an Event of Default (as defined in the note)) and is convertible into shares of the Company’s common stock at a conversion price equal to the greater of (i) the Fixed Conversion Price (as defined in the note) or (ii) the Variable Conversion Price (as defined in the note), subject to adjustment. The note may be prepaid by the Company at any time prior to the 180th day after the issuance date of the note with certain prepayment penalties as defined in the note | |||||||||||||||||||||||
Note interest rate | 9% | |||||||||||||||||||||||
Convertible promissory note and accrued interest | $ 92,483 | |||||||||||||||||||||||
Debt instrument conversion of shares | 4,607,401 | |||||||||||||||||||||||
Loss on extinguishment and settlement of debt | $ 64,602 | |||||||||||||||||||||||
Securities Purchase Agreement [Member] | Accredited Investor [Member] | Convertible Promissory Notes Three [Member] | ||||||||||||||||||||||||
Short-Term Debt [Line Items] | ||||||||||||||||||||||||
Note interest rate, description | bears interest at a rate of 9% per annum (increasing to 22% per annum upon the occurrence of an Event of Default (as defined in the note)) and is convertible into shares of the Company’s common stock at a conversion price equal to the greater of (i) the Fixed Conversion Price (as defined in the note) or (ii) the Variable Conversion Price (as defined in the note), subject to adjustment. The note may be prepaid by the Company at any time prior to the 180th day after the issuance date of the note with certain prepayment penalties as defined in the note | |||||||||||||||||||||||
Note interest rate | 9% | |||||||||||||||||||||||
Convertible promissory note and accrued interest | $ 92,700 | 8,567 | 8,567 | |||||||||||||||||||||
Debt instrument conversion of shares | 24,321,086 | |||||||||||||||||||||||
Loss on extinguishment and settlement of debt | $ 54,279 | |||||||||||||||||||||||
Debt instrument, maturity date | Jun. 29, 2022 | |||||||||||||||||||||||
Original issue discount and deferred financing costs | 2,648 | 2,648 | ||||||||||||||||||||||
Convertible promissory note and occurrence | 6,950 | |||||||||||||||||||||||
Debt default | $ 10,225 | |||||||||||||||||||||||
Securities Purchase Agreement [Member] | Accredited Investor [Member] | Convetible Promissory Notes Four [Member] | ||||||||||||||||||||||||
Short-Term Debt [Line Items] | ||||||||||||||||||||||||
Debt principal amount | $ 73,750 | |||||||||||||||||||||||
Note interest rate, description | bears interest at a rate of 9% per annum (increasing to 22% per annum upon the occurrence of an Event of Default (as defined in the note)) | |||||||||||||||||||||||
Note interest rate | 9% | |||||||||||||||||||||||
Convertible promissory note and accrued interest | 119,105 | 119,105 | ||||||||||||||||||||||
Debt instrument, maturity date | Aug. 05, 2022 | |||||||||||||||||||||||
Original issue discount and deferred financing costs | 109,639 | 109,639 | ||||||||||||||||||||||
Convertible promissory note and occurrence | 36,875 | 36,875 | ||||||||||||||||||||||
Securities Purchase Agreement [Member] | Accredited Investor [Member] | Convertible Promissory Notes Six [Member] | ||||||||||||||||||||||||
Short-Term Debt [Line Items] | ||||||||||||||||||||||||
Debt principal amount | $ 78,750 | |||||||||||||||||||||||
Note interest rate, description | bears interest at a rate of 9% per annum (increasing to 22% per annum upon the occurrence of an Event of Default (as defined in the note)) | |||||||||||||||||||||||
Note interest rate | 9% | |||||||||||||||||||||||
Convertible promissory note and accrued interest | 84,263 | 84,263 | ||||||||||||||||||||||
Debt instrument, maturity date | Nov. 05, 2022 | |||||||||||||||||||||||
Contract with Customer, Liability | $ 143,657 | |||||||||||||||||||||||
Original issue discount and deferred financing costs | $ 3,750 | 76,818 | 76,818 | |||||||||||||||||||||
Securities Purchase Agreement [Member] | Accredited Investor [Member] | Convertible Promissory Notes Seven [Member] | ||||||||||||||||||||||||
Short-Term Debt [Line Items] | ||||||||||||||||||||||||
Debt principal amount | $ 48,750 | |||||||||||||||||||||||
Note interest rate, description | bears interest at a rate of 9% per annum (increasing to 22% per annum upon the occurrence of an Event of Default (as defined in the note)) | |||||||||||||||||||||||
Note interest rate | 9% | |||||||||||||||||||||||
Convertible promissory note and accrued interest | 51,742 | 51,742 | ||||||||||||||||||||||
Debt instrument, maturity date | Dec. 10, 2022 | |||||||||||||||||||||||
Original issue discount and deferred financing costs | 46,459 | 46,459 | ||||||||||||||||||||||
Securities Purchase Agreement [Member] | Accredited Investor [Member] | Promissory Notes [Member] | ||||||||||||||||||||||||
Short-Term Debt [Line Items] | ||||||||||||||||||||||||
Debt principal amount | $ 303,000 | |||||||||||||||||||||||
Note interest rate | 12% | |||||||||||||||||||||||
Convertible promissory note and accrued interest | $ 9,505 | $ 9,505 | $ 397,657 | 397,657 | ||||||||||||||||||||
Debt instrument conversion of shares | 2,795,644 | |||||||||||||||||||||||
Loss on extinguishment and settlement of debt | $ 1,677 | |||||||||||||||||||||||
Debt discount | $ 39,500 | |||||||||||||||||||||||
Debt instrument, maturity date | Feb. 01, 2022 | |||||||||||||||||||||||
Proceeds from issuance of debt | $ 240,325 | |||||||||||||||||||||||
Payments for fees | 23,175 | |||||||||||||||||||||||
Repayments of notes payable | $ 42,420 | |||||||||||||||||||||||
Amortization of debt discount premium | $ 42,420 | |||||||||||||||||||||||
Securities Purchase Agreement [Member] | Accredited Investor [Member] | Promissory Notes [Member] | Common Stock [Member] | ||||||||||||||||||||||||
Short-Term Debt [Line Items] | ||||||||||||||||||||||||
Debt instrument conversion of shares | 200,000 | |||||||||||||||||||||||
Securities Purchase Agreement [Member] | Accredited Investor [Member] | Promissory Notes [Member] | Common Stock One [Member] | ||||||||||||||||||||||||
Short-Term Debt [Line Items] | ||||||||||||||||||||||||
Debt instrument conversion of shares | 200,000 | |||||||||||||||||||||||
Securities Purchase Agreement [Member] | Investor [Member] | Convertible Promissory Notes Three [Member] | ||||||||||||||||||||||||
Short-Term Debt [Line Items] | ||||||||||||||||||||||||
Debt principal amount | $ 85,750 | |||||||||||||||||||||||
Amendment #1 [Member] | Donald P. Monaco Insurance Trust [Member] | ||||||||||||||||||||||||
Short-Term Debt [Line Items] | ||||||||||||||||||||||||
Note interest rate | 12% | |||||||||||||||||||||||
Note payable | $ 530,000 | |||||||||||||||||||||||
Debt instrument, maturity date, description | the maturity date of the Monaco Note was extended to January 26, 2020 | |||||||||||||||||||||||
Amendment Two [Member] | Donald P. Monaco Insurance Trust [Member] | ||||||||||||||||||||||||
Short-Term Debt [Line Items] | ||||||||||||||||||||||||
Debt instrument, maturity date, description | the maturity date of the Monaco Note was extended to November 8, 2019 | |||||||||||||||||||||||
Agreement [Member] | Accredited Investor [Member] | Promissory Note [Member] | ||||||||||||||||||||||||
Short-Term Debt [Line Items] | ||||||||||||||||||||||||
Proceeds from note payable | $ 60,000 |
SCHEDULE OF DERIVATIVE LIABILIT
SCHEDULE OF DERIVATIVE LIABILITY MEASURED AT FAIR VALUE RECURRING BASIS (Details) - Fair Value, Inputs, Level 3 [Member] | 6 Months Ended |
Apr. 30, 2022 USD ($) | |
Defined Benefit Plan Disclosure [Line Items] | |
Conversion feature derivative liability, Beginning | $ 471,219 |
Initial fair value of derivative liability charged to other expense | 143,657 |
Loss on change in fair value included in earnings | 55,399 |
Derivative liability relieved by conversions of convertible promissory notes | (147,354) |
Conversion feature derivative liability, Ending | $ 522,921 |
SCHEDULE OF FAIR VALUE ASSUMPTI
SCHEDULE OF FAIR VALUE ASSUMPTIONS OF DERIVATIVE LIABILITY (Details) | 6 Months Ended |
Apr. 30, 2022 | |
Measurement Input, Price Volatility [Member] | Minimum [Member] | |
Derivative [Line Items] | |
Derivative liability measurement input, percentage | 243.5 |
Measurement Input, Price Volatility [Member] | Maximum [Member] | |
Derivative [Line Items] | |
Derivative liability measurement input, percentage | 281.6 |
Measurement Input, Expected Term [Member] | Minimum [Member] | |
Derivative [Line Items] | |
Derivative liability measurement input, months | 3 months |
Measurement Input, Expected Term [Member] | Maximum [Member] | |
Derivative [Line Items] | |
Derivative liability measurement input, months | 6 months 6 days |
Measurement Input, Risk Free Interest Rate [Member] | Minimum [Member] | |
Derivative [Line Items] | |
Derivative liability measurement input, percentage | 0.850 |
Measurement Input, Risk Free Interest Rate [Member] | Maximum [Member] | |
Derivative [Line Items] | |
Derivative liability measurement input, percentage | 1.410 |
Measurement Input, Share Price [Member] | |
Derivative [Line Items] | |
Derivative liability measurement input, percentage | 0.003 |
DERIVATIVE LIABILITY (Details N
DERIVATIVE LIABILITY (Details Narrative) - USD ($) | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Apr. 30, 2022 | Apr. 30, 2021 | Apr. 30, 2022 | Apr. 30, 2021 | Oct. 31, 2021 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||
Derivative liability | $ 522,921 | $ 522,921 | $ 471,219 | ||
Fair value of derivative liability | $ 112,451 | $ 11,235 | $ 55,399 | $ (27,972) | |
Conversion price, decrease | $ 0.003 | $ 0.02 |
SCHEDULE OF COMMON SHARE PURCHA
SCHEDULE OF COMMON SHARE PURCHASE WARRANTS OUTSTANDING (Details) | 6 Months Ended |
Apr. 30, 2022 $ / shares shares | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |
Warrants, Outstanding Ending Balance | shares | 1,339,114 |
Common stock issuable upon exercise of warrants, Warrants | shares | 1,339,114 |
Warrant [Member] | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |
Warrants, Outstanding Beginning Balance | shares | 2,619,114 |
Weighted Average Exercise Price, Beginning Balance | $ 2.24 |
Intrinsic Value, Beginning Balance | |
Warrants, Warrants granted and issued | shares | |
Weighted Average Exercise Price, Warrants granted and issued | |
Intrinsic Value, Warrants granted and issued | |
Warrants, Warrants exercised | shares | |
Weighted Average Exercise Price, Warrants exercised | |
Intrinsic Value, Warrants exercised | |
Warrants, Warrants forfeited | shares | (1,280,000) |
Weighted Average Exercise Price, Warrants forfeited | $ 1.41 |
Intrinsic Value, Warrants forfeited | |
Warrants, Outstanding Ending Balance | shares | 1,339,114 |
Weighted Average Exercise Price, Ending Balance | $ 3.03 |
Intrinsic Value, Ending Balance | |
Common stock issuable upon exercise of warrants, Warrants | shares | 1,339,114 |
Common stock issuable upon exercise of warrants, Weighted Average Exercise Price | $ 3.03 |
Common stock issuable upon exercise of warrants, Intrinsic Value |
SCHEDULE OF SHARE-BASED COMPENS
SCHEDULE OF SHARE-BASED COMPENSATION, ACTIVITY (Details) | 6 Months Ended |
Apr. 30, 2022 $ / shares shares | |
Share-Based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Number of Warrants Outstanding shares | shares | 1,339,114 |
Warrants Outstanding Weighted Average Remaining Contractual Life (Years) | 6 months 18 days |
Warrants Outstanding Weighted Average Exercise Price | $ 3.03 |
Number of Warrants Exercisable shares | shares | 1,339,114 |
Warrants Exercisable Weighted Average Exercise Price | $ 3.03 |
Range One [Member] | |
Share-Based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Exercise Prices | $ 3 |
Number of Warrants Outstanding shares | shares | 1,337,114 |
Warrants Outstanding Weighted Average Remaining Contractual Life (Years) | 6 months 10 days |
Warrants Outstanding Weighted Average Exercise Price | $ 3 |
Number of Warrants Exercisable shares | shares | 1,337,114 |
Warrants Exercisable Weighted Average Exercise Price | $ 3 |
Range Two [Member] | |
Share-Based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Exercise Prices | $ 25 |
Number of Warrants Outstanding shares | shares | 2,000 |
Warrants Outstanding Weighted Average Remaining Contractual Life (Years) | 8 months 1 day |
Warrants Outstanding Weighted Average Exercise Price | $ 25 |
Number of Warrants Exercisable shares | shares | 2,000 |
Warrants Exercisable Weighted Average Exercise Price | $ 25 |
STOCKHOLDERS_ DEFICIT (Details
STOCKHOLDERS’ DEFICIT (Details Narrative) - USD ($) | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||||||||
Jan. 13, 2021 | Nov. 18, 2020 | Oct. 06, 2020 | Apr. 30, 2022 | Jan. 31, 2022 | Apr. 30, 2021 | Jan. 31, 2021 | Apr. 30, 2022 | Apr. 30, 2021 | Oct. 31, 2021 | Oct. 09, 2012 | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||
Number of shares authorized | 7,625,000,000 | 7,625,000,000 | |||||||||
Common stock, shares authorized | 7,500,000,000 | 7,500,000,000 | 7,500,000,000 | ||||||||
Common stock, par value | $ 0.000001 | $ 0.000001 | $ 0.000001 | ||||||||
Common stock, shares issued | 87,521,179 | 87,521,179 | 23,844,566 | ||||||||
Reverse stock split description | adjusted to reflect a 1-for-500 reverse stock split | Common Stock at a ratio of 1-for-500 (the “Reverse Stock Split”) | 1-for-500 reverse stock split | 1-for-500 reverse stock split | |||||||
2020 Plan [Member] | |||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||
Number of shares authorized | 750,000,000 | ||||||||||
Number of shares issued on post split | 1,500,000 | ||||||||||
Amendment #1 [Member] | |||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||
Reverse stock split description | Common Stock at a ratio of 1-for-500 (the “Reverse Stock Split”) | ||||||||||
Series A Convertible Preferred Stock [Member] | |||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||
Preferred stock, shares authorized | 120,000,000 | 120,000,000 | 120,000,000 | 93,000,000 | |||||||
Preferred stock, par value | $ 0.000001 | $ 0.000001 | $ 0.000001 | ||||||||
Preferred stock, shares outstanding | 28,944,601 | 28,944,601 | 28,944,601 | ||||||||
Series B Convertible Preferred Stock [Member] | |||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||
Preferred stock, shares authorized | 1,000,000 | 1,000,000 | 1,000,000 | ||||||||
Preferred stock, par value | $ 0.000001 | $ 0.000001 | $ 0.000001 | ||||||||
Preferred stock, shares outstanding | 0 | 0 | 0 | ||||||||
Series C Convertible Preferred Stock [Member] | |||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||
Preferred stock, shares authorized | 1,000,000 | 1,000,000 | 1,000,000 | ||||||||
Preferred stock, par value | $ 0.000001 | $ 0.000001 | $ 0.000001 | ||||||||
Preferred stock, shares outstanding | 680,801 | 680,801 | 680,801 | ||||||||
Preferred Stock [Member] | |||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||
Preferred stock, shares authorized | 125,000,000 | 125,000,000 | |||||||||
Preferred stock, par value | $ 0.000001 | $ 0.000001 | |||||||||
Common Stock [Member] | |||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||
Common stock shares issued upon conversion | 31,494,615 | 32,181,998 | 312,256 | 1,685,918 | |||||||
Number of restricted shares issued | 400,000 | ||||||||||
Common Stock [Member] | Maximum [Member] | |||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||
Warrants to purchase common stock | 1,339,114 | 1,339,114 | |||||||||
Common Stock [Member] | Note Holders [Member] | |||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||
Common stock shares issued upon conversion | 63,676,613 | 1,998,174 | |||||||||
Stock issued during period value issues | $ 529,980 | $ 583,310 | |||||||||
Common Stock [Member] | Board Member [Member] | |||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||
Stock issued for service rendered, shares | 2,724,138 | ||||||||||
Stock issued for service rendered, value | $ 10,000 | ||||||||||
Common Stock [Member] | Vendor [Member] | |||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||
Stock issued for service rendered, shares | 67,728 | ||||||||||
Common Stock [Member] | Vendor One [Member] | |||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||
Stock issued for service rendered, shares | 107,364 | ||||||||||
Common Stock [Member] | Commitment Shares [Member] | |||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||
Number of restricted shares issued | 200,000 | ||||||||||
Common Stock [Member] | Returnable Shares [Member] | |||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||
Number of restricted shares issued | 200,000 | ||||||||||
Warrant [Member] | |||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||
Warrants, Warrants granted and issued | |||||||||||
Weighted Average Exercise Price, Warrants forfeited | 1,280,000 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details Narrative) | 3 Months Ended |
Jan. 31, 2022 USD ($) | |
Commitments and Contingencies Disclosure [Abstract] | |
Rent expense | $ 8,383 |
SCHEDULE OF DISCONTINUED OPERAT
SCHEDULE OF DISCONTINUED OPERATIONS INCLUDED CONSOLIDATED BALANCE SHEETS AND STATEMENTS OF OPERATIONS (Details) - USD ($) | 3 Months Ended | 6 Months Ended | |||||
Apr. 30, 2022 | Jan. 31, 2022 | Apr. 30, 2021 | Jan. 31, 2021 | Apr. 30, 2022 | Apr. 30, 2021 | Oct. 31, 2021 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||
Cash | $ 6,789 | $ 6,789 | $ 66,022 | ||||
Accounts receivable, net | 250,618 | 250,618 | 303,218 | ||||
Inventory | 145,129 | 145,129 | 145,129 | ||||
Other assets | 16,144 | 16,144 | 16,144 | ||||
Total Current Assets | 419,006 | 419,006 | 636,487 | ||||
Property and equipment, net | 64,651 | 64,651 | 85,067 | ||||
Operating lease right-of-use asset, net | 152,830 | 152,830 | 198,637 | ||||
Total Assets | 636,487 | 636,487 | 920,191 | ||||
Accounts payable and accrued expenses | 783,844 | 783,844 | 638,315 | ||||
Operating lease liability | 95,115 | 95,115 | 92,771 | ||||
Interest payable | 541,602 | 541,602 | 368,709 | ||||
Due to former officer | 221,586 | 221,586 | 221,586 | ||||
Notes payable | 1,562,985 | 1,562,985 | 1,533,294 | ||||
Convertible notes payable, net | 489,909 | 489,909 | 530,358 | ||||
Total Current Liabilities | 4,380,714 | 4,380,714 | 4,083,590 | ||||
Operating lease liability, net of current portion | 57,715 | 57,715 | 105,866 | ||||
Total Liabilities | 4,438,429 | 4,438,429 | 4,189,456 | ||||
Revenue | $ 347,844 | $ 347,844 | |||||
Cost of revenue | 168,792 | 168,867 | |||||
Gross Profit | 179,052 | 178,977 | |||||
Legal and professional fees | 25,000 | 75,000 | |||||
General and administrative | 135,143 | 203,145 | 236,684 | 358,482 | |||
Total Operating Expenses | 221,640 | 376,885 | 443,637 | 512,442 | |||
Operating (loss) income | (221,640) | (197,833) | (443,637) | (333,465) | |||
Interest expense | (102,373) | (80,784) | (185,793) | (146,941) | |||
(Loss) Gain on change in fair value of derivative liability | (112,451) | (11,235) | (55,399) | 27,972 | |||
Default principal increase on convertible notes payable | (47,100) | (47,100) | |||||
Amortization of original issue discounts and deferred financing costs | (17,738) | (37,252) | (76,779) | (64,764) | |||
Loss on extinguishment and settlement of debt | (4,494) | (34,823) | (115,086) | (34,941) | |||
Initial derivative liability expense | (520,701) | (143,657) | (800,213) | ||||
Gain on settlement of liabilities | 104,774 | 104,774 | |||||
Total Other (Expense) Income | (284,156) | (580,021) | (623,814) | (914,113) | |||
(Loss) income before income taxes | (505,796) | (777,854) | (1,067,451) | (1,247,578) | |||
Income taxes | |||||||
Net (loss) income | (505,801) | $ (602,689) | (707,513) | $ (446,135) | (1,108,490) | (1,153,648) | |
Continuing Operation [Member] | |||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||
Cash | 6,789 | 6,789 | 66,022 | ||||
Accounts receivable, net | 250,618 | 250,618 | 303,218 | ||||
Inventory | 145,129 | 145,129 | 145,129 | ||||
Prepaid expenses | |||||||
Other assets | 16,144 | 16,144 | 16,144 | ||||
Total Current Assets | 418,680 | 418,680 | 530,513 | ||||
Property and equipment, net | 64,651 | 64,651 | 85,067 | ||||
Operating lease right-of-use asset, net | 152,830 | 152,830 | 198,637 | ||||
Total Assets | 636,161 | 636,161 | 814,217 | ||||
Accounts payable and accrued expenses | 783,844 | 783,844 | 638,315 | ||||
Operating lease liability | 95,115 | 95,115 | 92,771 | ||||
Interest payable | 541,602 | 541,602 | 368,709 | ||||
Due to former officer | 221,586 | 221,586 | 221,586 | ||||
Notes payable | 1,562,985 | 1,562,985 | 1,533,294 | ||||
Convertible notes payable, net | 489,909 | 489,909 | 530,358 | ||||
Derivative liability | 522,921 | 522,921 | 471,219 | ||||
Total Current Liabilities | 4,217,962 | 4,217,962 | 3,856,252 | ||||
Operating lease liability, net of current portion | 57,715 | 57,715 | 105,866 | ||||
Total Liabilities | 4,275,677 | 4,275,677 | 3,962,118 | ||||
Revenue | 347,844 | 347,844 | |||||
Cost of revenue | 168,791 | 168,867 | |||||
Gross Profit | 179,052 | 178,977 | |||||
Salaries and benefits | 61,497 | 173,741 | 131,953 | 153,960 | |||
Selling and promotions expense | |||||||
Legal and professional fees | 25,000 | 75,000 | |||||
General and administrative | 135,143 | 203,145 | 236,683 | 358,481 | |||
Total Operating Expenses | 221,640 | 376,886 | 443,637 | 512,442 | |||
Operating (loss) income | (221,640) | (197,834) | (443,637) | (333,465) | |||
Interest expense | (102,373) | (80,784) | (185,793) | (146,941) | |||
(Loss) Gain on change in fair value of derivative liability | (112,451) | (11,235) | (55,399) | 27,972 | |||
Default principal increase on convertible notes payable | (47,100) | (47,100) | |||||
Amortization of original issue discounts and deferred financing costs | (17,738) | (37,252) | (76,779) | (64,764) | |||
Loss on extinguishment and settlement of debt | (4,494) | (34,823) | (115,086) | (34,941) | |||
Initial derivative liability expense | (520,701) | (143,657) | (800,213) | ||||
Gain on settlement of liabilities | 104,774 | 104,774 | |||||
Total Other (Expense) Income | (284,156) | (580,021) | (623,814) | (914,113) | |||
(Loss) income before income taxes | (505,796) | (777,855) | (1,067,451) | (1,247,578) | |||
Income taxes | |||||||
Net (loss) income | (505,796) | (777,855) | (1,067,451) | (1,247,578) | |||
Parent Company [Member] | |||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||
Cash | 7,115 | 7,115 | 68,243 | ||||
Accounts receivable, net | 250,618 | 250,618 | 303,218 | ||||
Inventory | 145,129 | 145,129 | 145,129 | ||||
Prepaid expenses | 4,084 | ||||||
Other assets | 16,144 | 16,144 | 115,813 | ||||
Total Current Assets | 419,006 | 419,006 | 636,487 | ||||
Property and equipment, net | 64,651 | 64,651 | 85,067 | ||||
Operating lease right-of-use asset, net | 152,830 | 152,830 | 198,637 | ||||
Total Assets | 636,487 | 636,487 | 920,191 | ||||
Accounts payable and accrued expenses | 946,596 | 946,596 | 865,653 | ||||
Operating lease liability | 95,115 | 95,115 | 92,771 | ||||
Interest payable | 541,602 | 541,602 | 368,709 | ||||
Due to former officer | 221,586 | 221,586 | 221,586 | ||||
Notes payable | 1,562,985 | 1,562,985 | 1,533,294 | ||||
Convertible notes payable, net | 489,909 | 489,909 | 530,358 | ||||
Derivative liability | 522,921 | 522,921 | 471,219 | ||||
Total Current Liabilities | 4,380,714 | 4,380,714 | 4,083,590 | ||||
Operating lease liability, net of current portion | 57,715 | 57,715 | 105,866 | ||||
Total Liabilities | 4,438,429 | 4,438,429 | 4,189,456 | ||||
Revenue | 3,310,680 | 6,765,324 | |||||
Cost of revenue | 2,563,644 | 5,424,992 | |||||
Gross Profit | 747,036 | 1,340,332 | |||||
Salaries and benefits | 61,497 | 229,738 | 143,403 | 255,352 | |||
Selling and promotions expense | 56,471 | 138,501 | |||||
Legal and professional fees | 25,000 | 6,807 | 75,000 | 30,476 | |||
General and administrative | 135,148 | 581,511 | 266,273 | 1,155,538 | |||
Total Operating Expenses | 221,645 | 874,528 | 484,676 | 1,579,867 | |||
Operating (loss) income | (221,645) | (127,492) | (484,676) | (239,535) | |||
Interest expense | (102,373) | (80,784) | (185,793) | (146,941) | |||
(Loss) Gain on change in fair value of derivative liability | (112,451) | (11,235) | (55,399) | 27,972 | |||
Default principal increase on convertible notes payable | (47,100) | (47,100) | |||||
Amortization of original issue discounts and deferred financing costs | (17,738) | (37,252) | (76,779) | (64,764) | |||
Loss on extinguishment and settlement of debt | (4,494) | (34,823) | (115,086) | (34,941) | |||
Initial derivative liability expense | (520,701) | (143,657) | (800,213) | ||||
Gain on settlement of liabilities | 104,774 | 104,774 | |||||
Total Other (Expense) Income | (284,156) | (580,021) | (623,814) | (914,113) | |||
(Loss) income before income taxes | (505,801) | (707,513) | (1,108,490) | (1,153,648) | |||
Income taxes | |||||||
Net (loss) income | (505,801) | (707,513) | (1,108,490) | (1,153,648) | |||
Discontinued Operations [Member] | |||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||
Cash | 326 | 326 | 2,221 | ||||
Accounts receivable, net | |||||||
Inventory | |||||||
Prepaid expenses | 4,084 | ||||||
Other assets | 99,669 | ||||||
Total Current Assets | 326 | 326 | 105,974 | ||||
Property and equipment, net | |||||||
Operating lease right-of-use asset, net | |||||||
Total Assets | 326 | 326 | 105,974 | ||||
Accounts payable and accrued expenses | 162,752 | 162,752 | 227,338 | ||||
Operating lease liability | |||||||
Interest payable | |||||||
Due to former officer | |||||||
Notes payable | |||||||
Convertible notes payable, net | |||||||
Derivative liability | |||||||
Total Current Liabilities | 162,752 | 162,752 | 227,338 | ||||
Operating lease liability, net of current portion | |||||||
Total Liabilities | 162,752 | 162,752 | $ 227,338 | ||||
Revenue | 2,962,836 | 6,417,480 | |||||
Cost of revenue | 2,394,853 | 5,256,125 | |||||
Gross Profit | 567,984 | 1,161,355 | |||||
Salaries and benefits | 55,997 | 11,450 | 101,392 | ||||
Selling and promotions expense | 56,471 | 138,501 | |||||
Legal and professional fees | 6,807 | 30,476 | |||||
General and administrative | 5 | 378,366 | 29,590 | 797,057 | |||
Total Operating Expenses | 5 | 497,642 | 41,039 | 1,067,425 | |||
Operating (loss) income | (5) | 70,342 | (41,039) | 93,930 | |||
Interest expense | |||||||
(Loss) Gain on change in fair value of derivative liability | |||||||
Default principal increase on convertible notes payable | |||||||
Amortization of original issue discounts and deferred financing costs | |||||||
Loss on extinguishment and settlement of debt | |||||||
Initial derivative liability expense | |||||||
Gain on settlement of liabilities | |||||||
Total Other (Expense) Income | |||||||
(Loss) income before income taxes | (5) | 70,342 | (41,039) | 93,930 | |||
Income taxes | |||||||
Net (loss) income | $ (5) | $ 70,342 | $ (41,039) | $ 93,930 |
SUBSEQUENT EVENTS (Details Narr
SUBSEQUENT EVENTS (Details Narrative) - USD ($) | 2 Months Ended | 3 Months Ended | ||||||
May 10, 2022 | Apr. 07, 2021 | Jun. 19, 2022 | Apr. 30, 2022 | Jan. 31, 2022 | Apr. 30, 2021 | Jan. 31, 2021 | Apr. 15, 2021 | |
Subsequent Event [Line Items] | ||||||||
Common stock issued for conversion | $ 124,161 | $ 405,819 | $ 118,658 | $ 464,654 | ||||
Accredited Investor [Member] | ||||||||
Subsequent Event [Line Items] | ||||||||
Debt interest rate | 24% | |||||||
Convertible Promissory Note [Member] | Securities Purchase Agreement [Member] | Accredited Investor [Member] | ||||||||
Subsequent Event [Line Items] | ||||||||
Debt principal amount | $ 88,500 | |||||||
Note interest rate, description | bears interest at a rate of 9% per annum (increasing to 22% per annum upon the occurrence of an Event of Default (as defined in the note)) and is convertible into shares of the Company’s common stock at a conversion price equal to the greater of (i) the Fixed Conversion Price (as defined in the note) or (ii) the Variable Conversion Price (as defined in the note), subject to adjustment. The note may be prepaid by the Company at any time prior to the 180th day after the issuance date of the note with certain prepayment penalties as defined in the note | |||||||
Debt interest rate | 9% | |||||||
Subsequent Event [Member] | Convertible Promissory Notes [Member] | ||||||||
Subsequent Event [Line Items] | ||||||||
Common stock issued for conversion | $ 402,744,703 | |||||||
Subsequent Event [Member] | Convertible Promissory Notes [Member] | Securities Purchase Agreement [Member] | Accredited Investor [Member] | ||||||||
Subsequent Event [Line Items] | ||||||||
Debt principal amount | $ 38,750 | |||||||
Subsequent Event [Member] | Convertible Promissory Note [Member] | Securities Purchase Agreement [Member] | Accredited Investor [Member] | ||||||||
Subsequent Event [Line Items] | ||||||||
Debt instrument, maturity date | May 10, 2023 | |||||||
Note interest rate, description | bears interest at a rate of 9% per annum (increasing to 22% per annum upon the occurrence of an Event of Default (as defined in the note)) and is convertible into shares of the Company’s common stock at a conversion price equal to the greater of (i) the Fixed Conversion Price (as defined in the note) or (ii) the Variable Conversion Price (as defined in the note) | |||||||
Debt interest rate | 9% |