10Q

10-Q 1 asi_10q.htm QUARTERLY REPORT 10Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT OF 1934

For the quarterly period ended December 31, 2017

[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT OF 1934

For the transition period from ____ to _____

Commission file number 000-27881

AS-IP TECH, INC.

(Exact name of small business issuer as specified in its charter)

Delaware

522101695

(State or other jurisdiction of

incorporation or organization)

(IRS Employer Identification No.)

2/1 Contour Close

Research, Victoria, 3095, Australia

(Address of principal executive officers)

+1 424-888-2212

(Issuer's telephone number)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [ ] No [X]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer [ ]	Accelerated filer [ ]
Non-accelerated filer [ ]	Smaller reporting company [X]
(Do not check if a smaller reporting company)	Emerging growth company [ ]

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. [ ]

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes [ ] No [X]

APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PRECEDING FIVE YEARS

Check whether the registrant filed all documents and reports required to be filed by Section l2, 13 or 15(d) of the Exchange Act after the distribution of securities under a plan confirmed by a court. Yes [X] No [ ]

APPLICABLE ONLY TO CORPORATE ISSUERS

As of February 27, 2018, there were 161,710,371 outstanding shares of the issuer's Common Stock, $0.0001 par value.

AS-IP TECH, INC.

FORM 10-Q

FOR THE QUARTER ENDED DECEMBER 31, 2017


PART I. FINANCIAL INFORMATION	4
ITEM 1. FINANCIAL STATEMENTS	4
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	12
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	13
ITEM 4. CONTROLS AND PROCEDURES	13
PART II. OTHER INFORMATION	15
ITEM 1. LEGAL PROCEEDINGS	15
ITEM 1A. RISK FACTORS	15
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS	15
ITEM 3. DEFAULTS UPON SENIOR SECURITIES	15
ITEM 4. MINE SAFETY DISCLOSURES	15
ITEM 5. OTHER INFORMATION	15
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K	15
SIGNATURES	16

PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

AS-IP TECH, INC.

BALANCE SHEETS


	(Unaudited)		(Audited)
	Dec. 31, 2017		June 30, 2017
ASSETS
Current Assets
Cash	$	350,786	$	56,569
Prepaid expenses		15,392		2,753
Accounts receivable - related parties		40,717		60,871

Total current assets		406,895		120,193

Intangible assets - related party, net of accumulated amortization for $195,000 as of December 31, 2017 and $150,000 as of June 30, 2017		255,000		300,000

Total assets	$	661,895	$	420,193

LIABILITIES AND STOCKHOLDERS' DEFICIT
Current Liabilities
Accounts payable and accrued expenses	$	28,859	$	16,092
Related party payables		319,734		273,717
Due to related parties		228,811		228,811
Loans		121,679		119,507
Advances		472,279
Deferred revenue		5,811		8,685
Total current liabilities		1,177,173		646,812

Total liabilities		1,177,173		646,812

Stockholders' Deficit
Preferred stock $0.0001 par value; 50,000,000 shares authorized; none issued and outstanding
Common stock, $0.0001 par value, 500,000,000 authorized, and 161,710,371 and 158,387,871 were issued and outstanding as of Dec. 31, 2017 and June 30, 2017, respectively		16,173		15,840
Additional paid-in capital		10,092,748		10,031,019
Subscriptions payable		26,186		26,186
Treasury stock - par value (50,000 shares)		(5)		(5)
Accumulated deficit		(10,650,380)		(10,299,659)

Total stockholders' deficit		(515,278)		(226,619)

Total liabilities and stockholders' deficit	$	661,895	$	420,193

The accompanying notes are an integral part of these financial statements.

AS-IP TECH, INC.

STATEMENTS OF OPERATIONS

(UNAUDITED)


	Three Months Ending Dec. 31, 2017		Three Months Ending Dec. 31, 2016		Six Months Ending Dec. 31, 2017		Six Months Ending Dec. 31, 2016
Revenue
BizjetMobile system sales - related parties	$	-	$	-	$	21,990	$	29,970
BizjetMobile service fees - related parties		25,244		25,168		54,054		57,024
License fees
Total revenue		25,244		25,168		76,044		86,994

Cost of sales - related parties		4,818		9,541		18,450		33,975
Gross Profit		20,426		15,627		57,594		53,019

Operating expenses:
Accounting and auditing		16,475		8,580		16,490		14,580
Advertising and promotion		2,025		1,843		3,430		3,924
Advertising and promotion - related party		4,536		-		4,536		0
Amortization of capitalized termination fee to a related party		22,500		22,500		45,000		45,000
Banking		847		1,191		1,677		3,695
Capital raising costs		0		-		1,148		0
Communications data		763		0		12,614		0
Communications data - related party		6,120		15,918		11,419		36,806
Consumables		1,400		-		1,400		0
Consumables - related party		2,519		-		2,519		0
Corporate administration		1,637		1,845		2,374		2,771
Corporate promotion		-		-		0		249
Engineering services		48,000		36,000		96,000		84,000
Engineering services - related party		-		-		0		14,300
Marketing - related party		52,530		33,739		102,055		75,764
Officers management fees		24,000		13,000		48,000		30,000
Office expenses, rent, utilities		87		429		1,313		728
Patent fees		-		-		427		459
Technical service support - related party		12,000		12,000		24,000		24,000
Trade shows		-		-		13,088		0
Travel		-		3,000		2,458		3,000
Total operating expenses		195,439		150,045		389,948		339,276

Loss from operations		(175,013)		(134,418)		(332,354)		(286,257)

Other (income) expense:
Interest		4,537		2,419		9,672		4,082
Interest - related party		4,447		4,030		8,695		7,995
Total Other (income) expense		8,984		6,449		18,367		12,077

Net profit (loss)		(183,997)		(140,867)		(350,721)		(298,334)

Net loss per share - (Basic)	$	(0.00)	$	(0.00)	$	(0.00)	$	(0.00)
Weighted average number of common shares outstanding		161,329,664		133,110,732		159,875,072		135,774,286

The accompanying notes are an integral part of these financial statements.

AS-IP TECH, INC.

STATEMENTS OF CASH FLOWS

(UNAUDITED)


	Six Months Ending December 31,
	2017		2016

Cash flows from operating activities:
Net loss	$	(350,721)	$	(298,334)

Adjustments to reconcile net loss to net cash used by operating activities:
Compensatory stock issuances - accounts payable		0		30,000
Amortisation of intangibles		45,000		45,000
Changes in operating assets and liabilities
Increase (Decrease) in accounts payable		12,767		(14,116)
Increase (Decrease) in related party payables		46,017		13,207
Increase (Decrease) in deferred revenue		(2,874)		(3,572)
Decrease (Increase) in accounts receivable		20,154		(15,654)
Decrease (Increase) in prepaid expenses		(12,639)		0
Net cash used in operating activities		(242,296)		(243,469)

Cash flows from financing activities:
Loans from unrelated party		2,172		0
Advances from unrelated party		472,279		17,055
Proceeds from issuance of common stock		62,062		158,790
Funds received pending issue of shares		0		4,800
Net cash provided by financing activities		536,513		180,645

Net Increase/(Decrease) in cash		294,217		(62,824)
Cash, beginning of period		56,569		64,292

Cash, end of period	$	350,786	$	1,468


Stock issued for payables conversion	$	0	$	30,000

The accompanying notes are an integral part of these financial statements.

AS-IP TECH, INC.

NOTES TO FINANCIAL STATEMENTS

AS OF DECEMBER 31, 2017

(UNAUDITED)

Note 1. Summary of Significant Accounting Policies

Basis of Presentation

The accompanying unaudited financial statements of the Company have been prepared in accordance with Generally Accepted Accounting Principles used in the United States of America and with the rules and regulations of the United States Securities and Exchange Commission for interim financial information. Accordingly, they do not include all the information and footnotes necessary for a comprehensive presentation of financial position and results of operations.

The functional currency of the Company is the United States dollar. The unaudited financial statements are expressed in United States dollars. It is management's opinion that any material adjustments (consisting of normal recurring adjustments) have been made which are necessary for a fair financial statement presentation. The results for the interim period are not necessarily indicative of the results to be expected for the year.

For further information, refer to the financial statements and footnotes included in the Company's Form 10-K for the year ended June 30, 2017.

Use of Estimates

The preparation of financial statements in conformity with U.S. 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 revenues and expenses during the reporting period.

Such estimates and assumptions impact, among others, the valuation allowance for deferred tax assets, due to continuing and expected future losses, and share-based payments.

Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the financial statements, which management considered in formulating its estimate could change in the near term due to one or more future confirming events. Accordingly, the actual results could differ significantly from estimates.

Per Share Data

Net loss per common share is computed by dividing net loss by the weighted average common shares outstanding during the period as defined by Financial Accounting Standards, ASC Topic 260, "Earnings per Share". Basic earnings per common share ("EPS") calculations are determined by dividing net income by the weighted average number of shares of common stock outstanding during the year. Diluted earnings per common share calculations are determined by dividing net income by the weighted average number of common shares and dilutive common share equivalents outstanding. During periods when common stock equivalents, if any, are anti-dilutive they are not considered in the computation.

Cash and cash equivalents:

For purposes of the statement of cash flows, the Company considers highly liquid financial instruments purchased with a maturity of three months or less to be cash equivalents.

Income taxes

The Company accounts for its income taxes in accordance with FASB ASC Topic 740-10, "Income Taxes", which requires recognition of deferred tax assets and liabilities for future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and tax credit carry-forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.

Fair value of financial instruments

The carrying value of cash equivalents and accounts payable and accrued expenses approximates fair value due to the short period of time to maturity.

Revenue Recognition

The Company recognizes revenue on an accrual basis. Revenue is generally realized or realizable and earned when all of the following criteria are met: 1) persuasive evidence of an arrangement exists between the Company and our customer(s); 2) services have been rendered; 3) our price to our customer is fixed or determinable; and 4) collectability is reasonably assured.

Long-lived Assets

In accordance with the Financial Accounting Standards Board ("FASB") Accounts Standard Codification (ASC) ASC 360-10, "Property, Plant and Equipment," the carrying value of intangible assets and other long-lived assets is reviewed on a regular basis for the existence of facts or circumstances that may suggest impairment. The Company recognizes impairment when the sum of the expected undiscounted future cash flows is less than the carrying amount of the asset. Impairment losses, if any, are measured as the excess of the carrying amount of the asset over its estimated fair value. Capitalized costs are amortized based on current and future revenue for each asset with an annual minimum equal to the straight-line amortization over the remaining estimated economic life of the asset.

Stock-based compensation

The Company records stock based compensation in accordance with the guidance in ASC Topic 718, which requires the Company to recognize expenses related to the fair value of its employee stock option awards. This eliminates accounting for share-based compensation transactions using the intrinsic value and requires instead that such transactions be accounted for using a fair-value-based method. The Company recognizes the cost of all share-based awards on a graded vesting basis over the vesting period of the award.

ASC 505, "Compensation-Stock Compensation", establishes standards for the accounting for transactions in which an entity exchanges its equity instruments to non employees for goods or services. Under this transition method, stock compensation expense includes compensation expense for all stock-based compensation awards granted on or after January 1, 2006, based on the grant-date fair value estimated in accordance with the provisions of ASC 505.

Recent pronouncements

Recent accounting pronouncements issued by the FASB (including its Emerging Issues Task Force), the American Institute of Certified Public Accountants, and the SEC did not, or are not believed by management to, have a material impact on the Company's present or future financial position, results of operations or cash flows.

Note 2. Going Concern

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. The Company had an Accumulated Deficit of $10,650,380 at December 31, 2017 and will be required to make significant expenditures in connection with development of the BizjetMobile and fflya businesses, seeking additional funding through investments and general and administrative expenses. The Company's ability to continue its operations is dependent upon its raising of capital through debt or equity financing in order to meet its working capital needs.

These conditions raise substantial doubt about the Company's ability to continue as a going concern, and if substantial additional funding is not acquired or alternative sources developed, management will be required to curtail its operations.

The Company may raise additional capital by the sale of its equity securities, through an offering of debt securities, or from borrowing from a financial institution. The Company does not have a policy on the amount of borrowing or debt that the Company can incur. Management believes that actions presently being taken to obtain additional funding provides the additional opportunity for the Company to continue as a going concern. However, there is no assurance of additional funding being available or on acceptable terms, if at all. The financial statements do not include any adjustments relating to the recoverability and classification of recorded assets or the amounts of and classification of liabilities that might be necessary in the event the Company cannot continue in existence.

Note 3. Related Party Transactions

As of December 31, 2017 and June 30, 2017, the Company has recorded as "related party payables", $319,734 and $273,717, respectively, which are due mainly to advances made by the CFO to pay for operating expenses. From July 1, 2016, interest has accrued on amounts due to the CFO calculated quarterly at a rate of 6.5% per annum. As a result, in the three months ending December 31, 2017 and December 31, 2016, the Company recorded Interest - related party of $4,447 and $4,030 respectively, and in the six months ending December 31, 2017 and December 31, 2016, the Company recorded Interest - related party of $8,695 and $7,995 respectively.

As of December 31, 2017 and June 30, 2017, the Company had "due to related parties" of $228,811 and $228,811 respectively which are advances made by related parties to provide capital and outstanding directors fees. These amounts are non-interest bearing, unsecured and due on demand.

As of December 31, 2017 and June 30, 2017, the Company had “Accounts receivable - related parties” of $40,717 and $60,871 due from entities affiliated through common stockholders and directors.

In 2016, the Company acquired the BizjetMobile intellectual property from a related party for $450,000. As of December 31, 2017 and June 30, 2017, the Company has accumulated $195,000 and $150,000 respectively for amortization of the value of the intellectual property.

In the three months ended December 31, 2017 and December 31, 2016 respectively, the Company recorded revenue of $25,244 and $25,168 from entities affiliated through common stockholders and directors for BizjetMobile service fees. In the six months ended December 31, 2017 and December 31, 2016 respectively, the Company recorded revenue of $54,054 and $57,024 from entities affiliated through common stockholders and directors for BizjetMobile service fees. In the six months ended December 31, 2017 and December 31, 2016 respectively, the Company recorded revenue of $21,990 and $29,970 from entities affiliated through common stockholders and directors for BizjetMobile system sales.

In the three months ended December 31, 2017 and December 31, 2016 respectively, the Company incurred expenses of approximately $24,000 and $13,000 respectively to entities affiliated through common stockholders and directors for management expenses. In the six months ended December 31, 2017 and December 31, 2016 respectively, the Company incurred expenses of approximately $48,000 and $30,000 respectively to entities affiliated through common stockholders and directors for management expenses. These expenses have been classified as officer’s management fees in the accompanying financial statements.

In the three months ended December 31, 2017 and December 31, 2016 respectively, the Company incurred marketing expense of $52,530 and $33,739 to entities affiliated through common stockholders and directors. In the six months ended December 31, 2017 and December 31, 2016 respectively, the Company incurred marketing expense of $102,055 and $75,764 to entities affiliated through common stockholders and directors.

In the three months ended December 31, 2017 and December 31, 2016 respectively, the Company incurred expense of $12,000 and $12,000 to entities affiliated through common stockholders and directors for technical service support. In the six months ended December 31, 2017 and December 31, 2016 respectively, the Company incurred expense of $24,000 and $24,000 to entities affiliated through common stockholders and directors for technical service support.

In the three months ended December 31, 2017 and December 31, 2016 respectively, the Company incurred cost of sales, comprising commissions of $4,818 and $9,541 to entities affiliated through common stockholders and directors. In the six months ended December 31, 2017 and December 31, 2016 respectively, the Company incurred cost of sales, comprising commissions of $18,450 and $33,975 to entities affiliated through common stockholders and directors. Sales commissions are normally 30% of the sale price of services or systems, but are negotiable on a case by case basis.

In the three months ended December 31, 2017 and December 31, 2016 respectively, the Company reimbursed communications and data costs incurred of $6,120 and $15,918 to entities affiliated through common stockholders and directors. In the six months ended December 31, 2017 and December 31, 2016 respectively, the Company reimbursed communications and data costs incurred of $11,419 and $36,806 to entities affiliated through common stockholders and directors.

In the six months ended December 31, 2016, the Company incurred engineering service costs of $14,300 to entities affiliated through common stockholders and directors, on normal commercial terms in the course of the Company’s normal business.

Note 4. Stockholders' Deficit

During the three month period ended December 31, 2017, the Company issued 322,500 shares of common stock for cash of $0.025 per share, resulting in an increase in Common Stock of $32 and an increase in Additional Paid-In Capital by $8,030.

Note 5. Commitments and Contingencies

The Company has an unsecured loan from a third party with balance outstanding at December 31, 2017 of $41,771 (December 31, 2016 $47,490). Interest is calculated at a rate of 20% per annum with interest of $2,128 and $2,419 taken up in the three months ended December 31, 2017 and December 31, 2016 respectively. The Company is making principal and interest payments for the loan of $1,250 per month and will increase the payments when cash flow allows.

The Company has outstanding unsecured loans totalling $70,295 from shareholders at December 31, 2017. Balance at December 31, 2016 was nil. The terms of the loans provide that if they are not repaid by the loan anniversary (December 31 each year), the Company will issue 16,667 shares of common stock for each $5,000 of the loan outstanding in lieu of interest. At December 31, 2017, the Company had accumulated interest on the loans of $9,613 calculated at the Company’s prevailing share price, which included $2,343 for the three months ended December 31, 2017. The interest will be converted to shares of common stock as stated above.

Both of the above loan facilities are included under “Loans” in the Company’s balance sheet.

Note 6. Subsequent Event

On February 16, 2018, the Company announced that it will convert advances of $562,500 (of which $472,279 recorded as Advances at December 31, 2017) received from shareholders for funding production of its fflya systems, to two convertible note issues as follows:

The first convertible note for $337,500 finances the initial 15 system shipsets. Terms of the issue are:

Interest rate: 20% per annum, payable monthly in arrears

Conversion price: $0.03 per share.

Maturity date: December 1, 2020

A second convertible note issue for $225,000 is to finance a further 10 system shipsets, on the following terms:

Interest rate: 20% per annum, payable monthly in arrears

Conversion price: $0.05 per share.

Maturity date: December 1, 2020

In return for providing system funding, each investor will receive a royalty for a period of three years on each shipset, once the systems commence operation, on terms to be agreed.

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

This quarterly report on form 10-Q includes "forward-looking statements" as defined by the Securities and Exchange Commission. These statements may involve known and unknown risks, uncertainties and other factors which may cause actual results, performance or achievements to be materially different from future results, performance or achievements expressed or implied by any forward-looking statements. Forward-looking statements, which involve assumptions and describe future plans, strategies and expectations, are generally identifiable by use of the words "may," "will," "could", "should," "expect," "anticipate," "estimate," "believe," "intend" or "project" or the negative of these words or other variations on these words or comparable terminology. These forward-looking statements are based on assumptions that may be incorrect. Actual results could differ materially from those expressed or implied by the forward-looking statements as a result of various factors. The company undertakes no obligation to update publicly any forward-looking statements for any reason, even if new information becomes available or other events occur in the future.

The following discussion should be read in conjunction with the accompanying financial statements for the three months and six months ended December 31, 2017 and the Form 10-K for the fiscal year ended June 30, 2017.

RESULTS AND PLAN OF OPERATIONS

THREE MONTHS ENDED DECEMBER 31, 2017 COMPARED TO THREE MONTHS ENDED DECEMBER 31, 2016

In the three months period ended December 31, 2017, the Company recorded revenue of $25,244, compared to revenue of $25,168 in the corresponding three month period ended December 31, 2016. After Cost of Sales of $4,818, the Company had a Gross Profit of $20,426 in the three months ended December 31, 2017. In the three months ended December 31, 2016, the Company recorded Cost of Sales of $9,541, which resulted in a Gross Profit of $15,627.

The Company has continued investing in the development and marketing of the airline versions of its fflya and CrewX technology and as result, the Company’s operating costs increased from $150,045 in the three months ended December 31, 2016 to $195,439 in the three months ended December 31, 2017. Main components of operating expenses are amortization, management, marketing and engineering expenses. In the three months ended December 31, 2017, the Company recorded an Operating Loss of $175,013 compared to an Operating Loss of $134,418 in the three months ended December 31, 2016.

The Company incurred interest charges of $8,984 and $6,449 in the three months ended December 31, 2017 and 2016 respectively. This resulted in Net Losses of $183,997 and $140,867 in the three months ended December 31, 2017 and 2016 respectively.

SIX MONTHS ENDED DECEMBER 31, 2017 COMPARED TO SIX MONTHS ENDED DECEMBER 31, 2016

In the six month period ended December 31, 2017, the Company recorded revenue of $76,044, compared to revenue of $86,994 in the corresponding six month period ended December 31, 2016. The revenue in the six months ended December 31, 2017 was lower than the revenue in the six months ended December 31, 2016 because of lower equipment sales in the period. After Cost of Sales of $18,450, the Company had a Gross Profit of $57,594 in the six months ended December 31, 2017. In the six months ended December 31, 2016, the Company recorded Cost of Sales of $33,975, which resulted in a Gross Profit of $53,019.

The Company has continued investing in the development and marketing of the airline versions of its fflya and CrewX technology and as result, the Company’s operating costs increased from $339,276 in the six months ended December 31, 2016 to $389,948 in the six months ended December 31, 2017. Main components of operating expenses are amortization, management, marketing and engineering expenses. In the six months ended December 31, 2017, the Company recorded an Operating Loss of $332,354 compared to an Operating Loss of $286,257 in the six months ended December 31, 2016.

The Company incurred interest charges of $18,367 and $12,077 in the six months ended December 31, 2017 and 2016 respectively. This resulted in Net Losses of $350,721 and $298,334 in the six months ended December 31, 2017 and 2016 respectively.

LIQUIDITY AND CAPITAL RESOURCES

The cash and cash equivalents balance increased from $56,569 at June 30, 2017 to $350,786 at December 31, 2017.

The Company reported revenue of $76,044 in the six months ending December 31, 2017 compared to $86,994 in the six month period ending December 31, 2016. The Company incurred a net loss of $332,354 from operating activities for the six months to December 31, 2017, compared to a net loss of $286,257 from operating activities for the six months to December 31, 2016.

Net cash used in operating activities for the six months ended December 31, 2017 was $242,296 compared to $243,469 during the six months ended December 31, 2016. Operating cash requirement in the six months ended December 31, 2017 was reduced through intangibles, increased related party payables and decreased accounts receivables.

The cash flow of the Company from financing activities for the six months ending December 31, 2017 was $536,513 as a result of proceeds from issue of common stock and advances from shareholders. Shareholders of the Company continue to fund the development and marketing of the fflya and CrewX products. In the six months ended December 31, 2016, the cash flow from financing activities was $180,645 from issue and pending issue of common stock.

The Company may raise additional capital by the sale of its equity securities, through an offering of debt securities, or from borrowing from a financial institution or other funding sources. The Company does not have a policy on the amount of borrowing or debt that the Company can incur. There are no guarantees on the company’s ability to raise additional capital.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Not applicable.

ITEM 4. CONTROLS AND PROCEDURES

(a) Evaluation of disclosure controls and procedures.

Our management, including the Company's President, and the Company's Chief Financial Officer, have evaluated the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Exchange Act Rules 13a- 15(e) and 15d-15(e)) and internal controls over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) as of the end of the period covered by this Quarterly Report on Form 10-Q.

Based upon that evaluation, our management concluded that our disclosure controls and procedures as of the end of the period covered by this report are ineffective and have material weaknesses as set out in the June 30, 2017 Form 10-K, such that the information required to be disclosed by us in the reports filed under the Securities Exchange Act of 1934 is (i) recorded, processed, summarized and reported within the time periods specified in SEC's rules and forms and (ii) accumulated and communicated to our management to allow timely decisions regarding disclosure. A controls system cannot provide absolute assurance however, that the effectiveness of the controls system are met and no evaluation of controls can provide absolute assurance that all control issues and instances of fraud if any, within a company have been detected.

(b) Changes in internal controls.

The Company's management, including the President and Chief Financial Officer, evaluated whether any changes in our internal controls over financial reporting, occurred during the quarter ended December 31, 2017. Based on that evaluation, our management concluded that no change occurred in the Company's internal controls over financial reporting during the quarter ended December 31, 2017 that has materially affected, or is reasonably likely to materially affect, the Company's internal controls over financial reporting.

PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

None

ITEM 1A. RISK FACTORS

The Company is a smaller reporting company and is not required to provide this information.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

As noted in "Note 4. Stockholders’ Deficit" in the Financial Statements above, during the three months ended December 31, 2017, the Company issued 322,500 shares of common stock valued at $8,062 for cash, that were not registered under the Securities Act of 1933. The offer, sale and issuance of these securities was made in reliance upon the exemption from the registration requirements of the Securities Act provided for by Section 4(2) thereof for transactions not involving a public offering. Appropriate legends have been affixed to the securities issued in these transactions. The purchasers of the securities had adequate access, through business or other relationships, to information about the Company.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None

ITEM 4. MINE SAFETY DISCLOSURES

None

ITEM 5. OTHER INFORMATION

None

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

(a) Exhibits:


Exhibit No.	Description
31.1	Certification of the President under Rule 13a-14(a) (Section 302 of the Sarbanes-Oxley Act of 2002)
31.2	Certification of the Chief Financial Officer under Rule 13a-14(a) (Section 302 of the Sarbanes-Oxley Act of 2002)
32.1	Certification Pursuant To Section 906 Of The Sarbanes-Oxley Act of 2002 (18 U.S.C. Section 1350)
32.2	Certification Pursuant To Section 906 Of The Sarbanes-Oxley Act of 2002 (18 U.S.C. Section 1350)

(b) Reports on Form 8-K was filed in the quarter ended December 31, 2017:

None

SIGNATURES

In accordance with the Exchange Act, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

AS-IP TECH, INC.


SIGNATURES:	TITLE	DATE


By: /s/ Richard Lukso	Director	February 27, 2018
Richard Lukso


By: /s/ Ronald J. Chapman	Director	February 27, 2018
Ronald J. Chapman


By: /s/ Philip A. Shiels	Director	February 27, 2018
Philip A. Shiels


By: /s/ Graham O. Chappell	Director	February 27, 2018
Philip A. Shiels