# Investview, Inc.: Form 10-Q/A for the period ended Sep 30, 2021

- Company: [Investview, Inc.](/companies/invu.md) (CIK 862651)
- Form: 10-Q/A
- Filed: 2022-06-01
- Accepted by EDGAR: Jun 1, 2022, 16:12 ET
- Period: 2021-09-30
- Accession: 0001493152-22-015597
- Inline XBRL: yes
- Main document: https://www.sec.gov/Archives/edgar/data/862651/000149315222015597/form10-qa.htm
- All documents and exhibits: https://www.sec.gov/Archives/edgar/data/862651/000149315222015597/

## Figures reported in this filing

Standardized XBRL line items for the period ended 2021-09-30.

| Line item | Period | Value | XBRL concept |
| --- | --- | ---: | --- |
| Revenue | 3 months, 2021-07-01 to 2021-09-30 | $23.4m | us-gaap:RevenueFromContractWithCustomerExcludingAssessedTax |
| Revenue | 6 months, 2021-04-01 to 2021-09-30 | $49.0m | us-gaap:RevenueFromContractWithCustomerExcludingAssessedTax |
| Operating income | 3 months, 2021-07-01 to 2021-09-30 | −$44.2m | us-gaap:OperatingIncomeLoss |
| Operating income | 6 months, 2021-04-01 to 2021-09-30 | −$33.7m | us-gaap:OperatingIncomeLoss |
| Income tax | 3 months, 2021-07-01 to 2021-09-30 | $758 | us-gaap:IncomeTaxExpenseBenefit |
| Income tax | 6 months, 2021-04-01 to 2021-09-30 | $3.9k | us-gaap:IncomeTaxExpenseBenefit |
| Net income | 3 months, 2021-07-01 to 2021-09-30 | −$43.2m | us-gaap:NetIncomeLoss |
| Net income | 6 months, 2021-04-01 to 2021-09-30 | −$34.5m | us-gaap:NetIncomeLoss |
| Diluted EPS | 3 months, 2021-07-01 to 2021-09-30 | −$0.01 | us-gaap:EarningsPerShareDiluted |
| Diluted EPS | 6 months, 2021-04-01 to 2021-09-30 | −$0.01 | us-gaap:EarningsPerShareDiluted |
| Basic EPS | 3 months, 2021-07-01 to 2021-09-30 | −$0.01 | us-gaap:EarningsPerShareBasic |
| Basic EPS | 6 months, 2021-04-01 to 2021-09-30 | −$0.01 | us-gaap:EarningsPerShareBasic |
| Diluted shares (weighted) | 3 months, 2021-07-01 to 2021-09-30 | 2,992,958,712 shares | us-gaap:WeightedAverageNumberOfDilutedSharesOutstanding |
| Diluted shares (weighted) | 6 months, 2021-04-01 to 2021-09-30 | 2,990,361,572 shares | us-gaap:WeightedAverageNumberOfDilutedSharesOutstanding |
| Operating cash flow | 6 months, 2021-04-01 to 2021-09-30 | $14.7m | us-gaap:NetCashProvidedByUsedInOperatingActivities |
| Capital expenditure | 6 months, 2021-04-01 to 2021-09-30 | $844.0k | us-gaap:PaymentsToAcquirePropertyPlantAndEquipment |
| Dividends paid | 6 months, 2021-04-01 to 2021-09-30 | $242.0k | us-gaap:PaymentsOfDividends |
| Cash and equivalents | at 2021-09-30 | $20.6m | us-gaap:CashAndCashEquivalentsAtCarryingValue |
| Current assets | at 2021-09-30 | $31.8m | us-gaap:AssetsCurrent |
| Total assets | at 2021-09-30 | $47.3m | us-gaap:Assets |
| Current liabilities | at 2021-09-30 | $12.4m | us-gaap:LiabilitiesCurrent |
| Total liabilities | at 2021-09-30 | $22.6m | us-gaap:Liabilities |
| Shareholders' equity | at 2021-09-30 | $24.7m | us-gaap:StockholdersEquity |

## Management's discussion and analysis

As filed, 28,177 characters.

### Forward-Looking Statements

The following discussion should be read in conjunction with our consolidated financial statements and notes to our financial statements included elsewhere in this report. This discussion contains forward-looking statements that involve risks and uncertainties. When the words “believe,” “expect,” “plan,” “project,” “estimate,” and similar expressions are used, they identify forward-looking statements. These forward-looking statements are based on management’s current beliefs and assumptions and information currently available to management, and involve known and unknown risks, uncertainties, and other factors that may cause the actual results, performance, or achievements to be materially different from any future results, performance, or achievements expressed or implied by these forward-looking statements. Information concerning factors that could cause our actual results to differ materially from these forward-looking statements can be found in our periodic reports filed with the Securities and Exchange Commission (“SEC”). The forward-looking statements included in this report are made only as of the date of this report. We disclaim any obligation to update any forward-looking statements whether as a result of new information, future events, or otherwise.

### Business Overview

Investview, Inc. (“we”, “our”, the “Company”) is a publicly traded diversified financial technology company with the symbol OTCQB:INVU. We operate through our family of wholly owned subsidiaries to provide dynamic financial education, diversified investment tools, global market research, self-directed brokerage services, institutional trade execution services, innovative advisory services (RIA, CTA), codeless algorithmic trading technologies, crypto mining, optimization, and repair solutions, and adaptive blockchain technologies.

We have spent the majority of fiscal 2021 establishing the company as a FINTECH provider of services. The Company’s objective is to provide a suite of offerings that advance financial technology initiatives in the personal finance, global markets, high speed processing optimization and crypto mining operations.

Our largest subsidiary in terms of revenue is iGenius, LLC. iGenius leverages a worldwide distribution network to provide financial education, technology and tools geared towards self-directed retail investors. Each iGenius membership provides a core set of financial education resources including live market training sessions, a robust library of financial education videos and courses, market calendars, and a variety of research and trade alert channels. These tools provide access to the information necessary to manage and improve one’s financial position. In addition to the financial education technology and tools, iGenius members also gain access to a variety of benefits provided through third party partnerships and arrangements. Some of these third-party products and services include cryptocurrency packages, discounted travel, crypto trading software and a digital wallet platform. iGenius members who choose to distribute the iGenius products and services can qualify to earn commissions and bonuses for selling memberships and retaining customers under the framework of a network marketing bonus plan.

Kuvera France S.A.S. was our entity in France and iGenius Global LTD is our entity in Northern Ireland. These entities were responsible for distributing our products and services throughout the European Union. Kuvera France S.A.S. was closed in June of 2021.

S.A.F.E. Management, LLC (“SAFE”) is a Registered Investment Adviser and Commodity Trading Adviser that has been established to deliver automated trading strategies to individuals who find they lack the time to trade for themselves. SAFE is committed to bringing innovative trade methodologies, strategies, and algorithms for all worldwide financial markets. SAFE will be structured under the Investview Financial Group Holdings, LLC and is planned to relaunch their services primarily focused on commodities and FOREX as a Commodity Trading Advisor.

SAFETek, LLC is a Blockchain technology company that provides leading-edge research, development, and management of digital asset technologies with a focus on Bitcoin mining and the new generation of digital assets. SAFETek’s Bitcoin mining operations in North America and other international locations aim to maintain optimal efficiency and profitability while running on sustainable, low-cost, and/or renewable energy sources. At these locations, SAFETek manages nearly 10,000 next-generation Bitcoin ASIC miner machines, with over 80% powered by renewable energy. SAFETek is also developing new and more efficient ways to mine cryptocurrencies through innovations in hardware, liquid immersion, firmware, and additional ways to develop and utilize renewable energy sources. The majority of this development and innovation work occurs at SAFETek’s 20,000 square foot facility in Texas that was opened in May 2021. At this facility, SAFETek operates a 24/7/365 Managed Network Operation Center (NOC) to achieve higher efficiency, productivity, and availability, a Bitcoin ASIC Miner Repair Service to clean, refurbish and optimize existing Bitcoin Mining Servers, a research and development center to test and develop new Bitcoin Mining firmware and liquid immersion systems, and a manufacturing facility to build mobile Bitcoin Mining Data Center Facilities. With these products and services, SAFETek aims to increase the hashrate, uptime, profitability, and overall ROI of crypto currency mining operations for ourselves and for our customers.

Apex Tek, LLC was the entity responsible for sales of the APEX program. Launched in September 2019, the APEX product pack included hardware, firmware, software and purchase protection that was purchased and then leased to SAFETek, LLC. We have currently ceased selling the APEX package and bought back all leases associated with the business. There are currently no operations or activity in Apex Tek, LLC.

United Games, LLC, United League, LLC, and Investment Tools & Training, LLC have had no operations and will be restructured or eliminated. Investview Financial Group Holdings, LLC and Investview MTS, LLC will be used in conjunction with our anticipated acquisition of the operating assets of SSA Technologies LLC, an entity that owns and operates LevelX Capital LLC, a FINRA registered broker-dealer and LevelX Advisors LLC, a registered investment advisor. Investview Financial Group Holdings, LLC owns Prodigio, a proprietary software-based trading platform with applications in the brokerage industry.

### Results of Operations

### Three Months Ended September 30, 2021 Compared to Three Months Ended September 30, 2020

Revenues

We recorded net revenue of $23,371,100 for the three months ended September 30, 2021, which was an increase of $15,617,763 or 201%, from the prior period net revenue of $7,753,337. The increase can be explained by an increase of Bitcoin value, an increase in active Bitcoin miners, the introduction of NDAU, the world’s first adaptive digital currency product, and improvements to our iGenius product offerings and distribution in new markets.

Our gross billings increased by 216%, or $17,475,725, to $25,572,329 in the three months ended September 30, 2021, versus $8,096,604 in the three months ended September 30, 2020, as a result of the activity noted above.

Operating Costs and Expenses

We recorded operating costs and expenses of $67,586,958 for the three months ended September 30, 2021, which was an increase of $60,337,993, or 832%, from the prior period’s operating costs and expenses of $7,248,965. $51,619,440 of that increase was attributable to a non-recurring and non-cash charge arising from the manner in which the acquisition of the Prodigio Smart Trading Platform, as well as the other operating assets and intellectual property rights of MPower Trading Systems, LLC, was accounted for on our financial statements, and did not represent a degradation in our cash flow or our liquidity and capital resources. After removing the charge relating to the September 3, 2021 transaction with MPower, the remaining increase of $8,718,553 can be explained, in general, by the growth of our operations and increases in our revenue. Specifically, there was an increase in our commissions of $6,518,278, or 191%, from $3,416,713 for the three months ended September 30, 2020, to $9,934,991 for the three months ended September 30, 2021. There was also an increase in our general and administrative expenses of $2,113,314, or 579%, from $364,826 for the three months ended September 30, 2020, to $2,478,140 for the three months ended September 30, 2021. The increase in commissions was a result of the increase in subscription and cryptocurrency revenue and the increase in general and administrative expenses was due to our cancellation of 200,000,000 shares that were returned in the three months ended September 30, 2020 in conjunction with the termination of a Joint Venture Agreement which resulted in the reversal of previously recorded expense of $951,956, thus offsetting total general and administrative expenses by that amount. No similar cancellation or reversal of expenses occurred in the current period.

Other Income and Expenses

We recorded other income (expense) of $971,767 for the three months ended September 30, 2021, which was a difference of $2,661,602, or 158%, from the prior period other income (expense) of $(1,689,835). The change is mostly due a decrease in interest expense from $2,480,067 in the three months ended September 30, 2020 compared to interest expense of $6,000 in the three months ended September 30, 2021 and an increase in realized gain on cryptocurrency from $86,427 for the three months ended September 30, 2020 versus $1,651,024 for the three months ended September 30, 2021. The decrease in the interest expense from the prior period was due to our efforts to restructure debt and payoff high-interest borrowings and the increase in the realized gain on cryptocurrency was simply due to the change in market value of cryptocurrency from the point at which we obtained the digital coins versus when we used the digital coins.

### Six Months Ended September 30, 2021 Compared to Six Months Ended September 30, 2020

Revenues

We recorded net revenue of $48,997,665 for the six months ended September 30, 2021, which was an increase of $35,654,512 or 267%, from the prior period net revenue of $13,343,153. The increase can be explained by an increase of Bitcoin value, an increase in active Bitcoin miners, the introduction of NDAU, the world’s first adaptive digital currency product, and improvements to our iGenius product offerings and distribution in new markets.

Our gross billings increased by 338%, or $47,348,406, to $61,351,529 in the six months ended September 30, 2021, versus $14,003,123 in the six months ended September 30, 2020, as a result of the activity noted above.

Operating Costs and Expenses

We recorded operating costs and expenses of $82,676,073 for the six months ended September 30, 2021, which was an increase of $66,830,494, or 422%, from the prior period’s operating costs and expenses of $15,845,579. $51,619,440 of that increase was attributable to a non-recurring and non-cash charge arising from the manner in which the acquisition of the Prodigio Smart Trading Platform, as well as the other operating assets and intellectual property rights of MPower Trading Systems, LLC, was accounted for on our financial statements, and did not represent a degradation in our cash flow or our liquidity and capital resources. After removing the charge relating to the September 3, 2021 transaction with MPower, the remaining increase of $31,056,633 can be explained, in general, by the growth of our operations and increases in our revenue. Specifically, there was an increase in our commissions of $11,926,868, or 176%, from $6,790,544 for the six months ended September 30, 2020, to $18,717,412 for the six months ended September 30, 2021. Also, there was an increase in general and administrative expenses of $1,715,006, or 61%, from $2,809,618 for the three months ended September 30, 2020, to $4,524,624 for the three months ended September 30, 2021. The increase in commissions was a result of the increase in subscription and cryptocurrency revenue and the increase in general and administrative expenses was due to our cancellation of 200,000,000 shares that were returned in the six months ended September 30, 2020 in conjunction with the termination of a Joint Venture Agreement which resulted in the reversal of previously recorded expense of $951,956, thus offsetting total general and administrative expenses by that amount. No similar cancellation or reversal of expenses occurred in the current period.

Other Income and Expenses

We recorded other income (expense) of $(789,836) for the six months ended September 30, 2021, which was a difference of $2,806,003, or 78%, from the prior period other income (expense) of $(3,595,839). The change is mostly due a decrease in interest expense from $4,727,165 in the six months ended September 30, 2020 compared to interest expense of $11,934 in the six months ended September 30, 2021, offset by an increase in interest expense, related parties from $389,720 in the six months ended September 30, 2020 compared to $1,523,477 for the six months ended September 30, 2021. The decrease in the interest expense from the prior period was due to our efforts to restructure debt and payoff high-interest borrowings and the increase in the interest expense, related parties was due to the Company obtaining funding from related parties in the form of convertible debt, which resulted in beneficial conversion features being recorded at the time of the borrowing and the debt discount being amortized to interest expense, related party, over the term of the notes.

### Liquidity and Capital Resources

During the six months ended September 30, 2021, we recorded a net loss of $34,472,191 which included a one-time non-recurring charge of $51,619,440 arising from the acquisition of the Prodigio Smart Trading Platform, as well as the operating assets and intellectual property rights of MPower; more particularly, the issuance of the Class B Redeemable Units in that transaction. This charge was a non-cash charge that had no impact on our cash flow or our liquidity and capital resources and related purely to the value imbalance determined for accounting purposes, between the appraised value of the Class B Redeemable Units issued to MPower versus the appraised value of the MPower assets acquired as of September 3, 2021, each such appraisal conducted under specific methodologies as determined to be in accordance with applicable accounting standards.

During the six months ended September 30, 2021, excluding the impact of our one-time non-cash charge of $51,619,440 arising from the issuance of the Class B Redeemable Units when we acquired the operating assets and intellectual property rights of MPower on September 3, 2021, we recorded net income of $17,147,249. Additionally, during the period, we generated $14,657,763 in cash through our operating activities, and generated $1,959,678 through financing activities. We used this cash to fund operations and fund the purchase of $843,990 worth of fixed assets. As a result, our cash, cash equivalents, and restricted cash increased by $15,771,769 to $22,433,596 as compared to $6,661,827 at the beginning of the fiscal year.

As of September 30, 2021, our current assets exceeded our current liabilities to result in working capital of $19,397,106, which was an increase from the working capital of $2,005,538 as of March 31, 2021.

### Critical Accounting Policies

Basis of Presentation

Our financial statements are presented on the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America (“GAAP”). Prior to September 20, 2021 we operated the Company on a March 31 fiscal year end. Effective September 20, 2021, our Board of Directors acted by unanimous written consent to change our fiscal year end to December 31.

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with the rules and regulations (Regulation S-X) of the Securities and Exchange Commission (the “SEC”) and with the instructions to Form 10-Q. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. The results of operations for the six months ended September 30, 2021, are not necessarily indicative of the operating results that may be expected for the filing of our December 31, 2021 Form 10-K that will cover the transition period for our new fiscal year. These unaudited condensed consolidated financial statements should be read in conjunction with the March 31, 2021 consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended March 31, 2021.

Principles of Consolidation

The consolidated financial statements include the accounts of Investview, Inc., and our wholly owned subsidiaries: iGenius, LLC, Kuvera France S.A.S., Apex Tek, LLC, SAFETek, LLC, S.A.F.E. Management, LLC, United Games, LLC, United League, LLC, Investment Tools & Training, LLC, iGenius Global LTD, Investview Financial Group Holdings, LLC, and Investview MTS, LLC. All intercompany transactions and balances have been eliminated in consolidation.

Use of Estimates

The preparation of these financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.

Revenue Recognition

#### Subscription Revenue

The majority of our revenue is generated by subscription sales and payment is received at the time of purchase. We recognize subscription revenue in accordance with ASC 606-10 where revenue is measured based on a consideration specified in a contract with a customer and recognized when we satisfy the performance obligation specified in each contract. Our performance obligation is to provide services over a fixed subscription period; therefore, we recognize revenue ratably over the subscription period and deferred revenue is recorded for the portion of the subscription period subsequent to each reporting date. Additionally, we offer a 10-day trial period to first time subscription customers, during which a full refund can be requested if a customer does not wish to continue with the product. Revenues are deferred during the trial period as collection is not probable until that time has passed. Revenues are presented net of refunds, sales incentives, credits, and known and estimated credit card chargebacks. As of September 30, 2021 and March 31, 2021 our deferred revenues were $2,820,120 and $1,561,188, respectively.

#### Mining Revenue

Through our wholly owned subsidiary, SAFETek, LLC, we leased computer equipment under a sales-type lease through June of 2020. In June of 2020 we cancelled all leases and purchased all of the rights and obligations under the leases, which included obtaining ownership of all computer equipment. We use the computer equipment to validate and process public blockchain transactions (commonly referred to as “mining”). As compensation for mining, we are issued block rewards and transaction fees from public blockchain networks in the form of newly created cryptocurrency units. Our mining activities constitute the ongoing major and central operations of SAFETek, LLC. Because we do not have contracts, nor do we have customers associated with our mining revenue, we recognize revenue when fees and/or rewards are settled, or ultimately granted to us as a result of our mining activities.

#### Cryptocurrency Revenue

We generate revenue from the sale of cryptocurrency packages to our customers through an arrangement with third-party providers. The various packages include different amounts of coin with differing rates of returns and terms and, in some cases, include a product protection option that allows the purchaser to protect their initial purchase price. The protection allows the purchaser to obtain 50% of their purchase price at five years or 100% of their purchase price at ten years. Both the coin and the protection option are delivered by third-party providers.

We recognize cryptocurrency revenue in accordance with ASC 606-10 where revenue is measured based on a consideration specified in a contract with a customer and recognized when we satisfy the performance obligation specified in each contract. Our performance obligation is to arrange for the third-parties to provide coin and protection (if applicable) to our customers and payment is received from our customers at the time of order placement. All customers are given two weeks to request a refund, therefore we record a customer advance on our balance sheet upon receipt of payment. After the two weeks have passed from order placement, we request our third-party providers to deliver coin and protection (if applicable), at which time we recognize revenue and the amounts due to our providers on our books. As of September 30, 2021 and March 31, 2021 our customer advances related to cryptocurrency revenue were $870,168 and $2,067,313, respectively.

#### Fee Revenue

We generate fee revenue from our customers through SAFE Management, our subsidiary licensed as a Registered Investment Advisor and Commodities Trading Advisor. We recognize fee revenue in accordance with ASC 606-10 where revenue is measured based on a consideration specified in a contract with a customer and recognized when we satisfy the performance obligation specified in each contract. Our performance obligation is to deliver fully managed trading services to individuals who do not meet the requirements of Qualified Investors and who lack the time to trade for themselves. We recognize fee revenue as our performance obligation is met and we receive payment for such advisory fees in the month following recognition.

Revenue generated for the six months ended September 30, 2021 is as follows:

|  | Subscription Revenue | Cryptocurrency Revenue | Mining Revenue | Fee Revenue | Total |
| --- | ---: | ---: | ---: | ---: | ---: |
| Gross billings/receipts | $26,436,065 | $18,205,143 | $16,710,321 | $- | $61,351,529 |
| Refunds, incentives, credits, and chargebacks | (1,552,154) | - | - | - | (1,552,154) |
| Amounts paid to providers | - | (10,801,710) | - | - | (10,801,710) |
| Net revenue | $24,883,911 | $7,403,433 | $16,710,321 | $- | $48,997,665 |

For the six months ended September 30, 2021 foreign and domestic revenues were approximately $25.5 million and $23.5 million, respectively.

Revenue generated for the six months ended September 30, 2020 is as follows:

|  | Subscription Revenue | Cryptocurrency Revenue | Mining Revenue | Fee Revenue | Total |
| --- | ---: | ---: | ---: | ---: | ---: |
| Gross billings/receipts | $10,159,115 | $- | $3,836,285 | $7,723 | $14,003,123 |
| Refunds, incentives, credits, and chargebacks | (659,970) | - | - | - | (659,970) |
| Amounts paid to providers | - | - | - | - | - |
| Net revenue | $9,499,145 | $- | $3,836,285 | $7,723 | $13,343,153 |

For the six months ended September 30, 2020 foreign and domestic revenues were approximately $8.9 million and $4.4 million, respectively.

Revenue generated for the three months ended September 30, 2021 is as follows:

|  | Subscription Revenue | Cryptocurrency Revenue | Mining Revenue | Fee Revenue | Total |
| --- | ---: | ---: | ---: | ---: | ---: |
| Gross billings/receipts | $14,904,004 | $2,329,566 | $8,338,759 | $- | $25,572,329 |
| Refunds, incentives, credits, and chargebacks | (869,790) | - | - | - | (869,790) |
| Amounts paid to providers | - | (1,331,439) | - | - | (1,331,439) |
| Net revenue | $14,034,214 | $998,127 | $8,338,759 | $- | $23,371,100 |

28

For the three months ended September 30, 2021 foreign and domestic revenues were approximately $13.6 million and $9.8 million, respectively.

Revenue generated for the three months ended September 30, 2020 is as follows:

|  | Subscription Revenue | Cryptocurrency Revenue | Mining Revenue | Fee Revenue | Total |
| --- | ---: | ---: | ---: | ---: | ---: |
| Gross billings/receipts | $5,599,155 | $- | $2,493,739 | $3,710 | $8,096,604 |
| Refunds, incentives, credits, and chargebacks | (343,267) | - | - | - | (343,267) |
| Amounts paid to providers | - | - | - | - | - |
| Net revenue | $5,255,888 | $- | $2,493,739 | $3,710 | $7,753,337 |

For the three months ended September 30, 2020 foreign and domestic revenues were approximately $7.3 million and $0.5 million, respectively.

### Recently Issued Accounting Pronouncements

In August 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (ASU) No. ASU 2020-06, *Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity,* which simplifies the accounting for certain financial instruments with characteristics of liabilities and equity, including convertible instruments and contracts on an entity’s own equity. Under current GAAP, there are five accounting models for convertible debt instruments. ASU 2020-06 removes from U.S. GAAP the separation models for (1) convertible debt with a cash conversion feature and (2) convertible instruments with a beneficial conversion feature. As a result, after adopting the ASU’s guidance, entities will not separately present in equity an embedded conversion feature in such debt. Instead, they will account for a convertible debt instrument wholly as debt, and for convertible preferred stock wholly as preferred stock (i.e., as a single unit of account), unless (1) a convertible instrument contains features that require bifurcation as a derivative under ASC 815 or (2) a convertible debt instrument was issued at a substantial premium. Additionally, for convertible debt instruments with substantial premiums accounted for as paid-in capital, the FASB decided to add disclosures about (1) the fair value amount and the level of fair value hierarchy of the entire instrument for public business entities and (2) the premium amount recorded as paid-in capital. ASU 2020-06 will be effective for public business entities that meet the definition of a Securities and Exchange Commission (SEC) filer, excluding entities eligible to be smaller reporting companies as defined by the SEC, for fiscal years beginning after December 15, 2021, including interim periods within those fiscal years. For all other entities, the amendments are effective for fiscal years beginning after December 15, 2023, including interim periods within those fiscal years. Early adoption is permitted, but no earlier than fiscal years beginning after December 15, 2020, including interim periods within those fiscal years. The Company is currently evaluating the potential impact of the adoption of this accounting pronouncement to its financial statements.

We have noted no other recently issued accounting pronouncements that we have not yet adopted that we believe are applicable or would have a material impact on our financial statements.

### Off-Balance Sheet Arrangements

We do not have any off-balance sheet arrangements that are reasonably likely to have a current or future effect on our financial condition, revenues, and results of operations, liquidity, or capital expenditures.

## Market risk

As filed, 173 characters.

We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and, as such, are not required to provide the information under this item.

## Controls and procedures

As filed, 1,747 characters.

### Evaluation of Disclosure Controls and Procedures

Our management, with the participation of our acting Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of our disclosure controls and procedures (as defined in Rule 13a-15 under the Securities Exchange Act of 1934 (the “Exchange Act”) as of the end of the period covered by this Quarterly Report on Form 10-Q. In designing and evaluating the disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives. In addition, the design of disclosure controls and procedures must reflect the fact that there are resource constraints and that management is required to apply its judgment in evaluating the benefits of possible controls and procedures relative to their costs.

Our disclosure controls and procedures are designed to provide reasonable, not absolute, assurance that the objectives of our disclosure control system are met. Because of inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues, if any, within a company have been detected. Our acting Chief Executive Officer and Chief Financial Officer have concluded, based on their evaluation as of the end of the period covered by this report, that our disclosure controls and procedures were effective.

### Changes in Internal Controls

There were no changes in our internal controls over financial reporting during the fiscal quarter ended September 30, 2021, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Filed Jun 1, 2022.
Source: SEC EDGAR, the filing index for accession 0001493152-22-015597. Last ingested by Listed: Oct 24, 2026, 14:58 ET. No prices; not investment advice.