10Q

QUARTERLY REPORT

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, 2018

[ ] 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	(IRS Employer Identification No.)
incorporation or organization)

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 [X]	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 December 20, 2019, there were 182,112,766 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, 2018

PART I. FINANCIAL INFORMATION	4
ITEM 1. FINANCIAL STATEMENTS	4
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	13
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	14
ITEM 4. CONTROLS AND PROCEDURES	14
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)

	Dec. 31, 2018		June 30, 2018

ASSETS
Current Assets
Cash	$	11,512	$	40,457
Total current assets		11,512		40,457

Intangible assets - related party, net of accumulated amortization for $260,607 as of Dec. 31, 2018 and $240,000 as of June 30, 2018		75,561		96,169

Total assets	$	87,073	$	136,626

LIABILITIES AND STOCKHOLDERS' DEFICIT
Current Liabilities
Accounts payable and accrued expenses	$	55,784	$	15,300
Related party payables		449,894		351,019
Due to related parties		228,811		228,811
Loans		718,702		696,873
Deferred revenue		2,696		2,935
Subscriptions for capital		8,150		3,500
Total current liabilities		1,464,037		1,298,438

Total liabilities		1,464,037		1,298,438

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 170,479,543 and 161,960,376 were issued and outstanding as of Dec. 31, 2018 and June 30, 2018, respectively		17,050		16,197
Additional paid-in capital		10,267,481		10,102,337
Subscriptions payable		26,186		26,186
Treasury stock - par value (50,000 shares)		(5)		(5)
Accumulated deficit		(11,687,676)		(11,306,527)

Total stockholders' deficit		(1,376,964)		(1,161,812)

Total liabilities and stockholders' deficit	$	87,073	$	136,626

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

AS-IP TECH, INC.

STATEMENTS OF OPERATIONS

(UNAUDITED)

	Three Months Ending December 31,				Six Months Ending December 31,
	2018		2017		2018		2017
Revenue
BizjetMobile system sales - related parties	$	29,970	$	-	$	29,970		21,990
BizjetMobile service fees - related parties		11,699		25,244		24,500		54,054
Total revenue		41,669		25,244		54,470		76,044

Cost of sales - related parties		17,583		4,818		19,736		18,450
Gross Profit		24,086		20,426		34,734		57,594

Operating expenses:
Selling, general and administrative expenses		9,948		23,234		45,953		55,271
Advertising and promotion - related party		-		4,536		-		4,536
Amortization of capitalized termination fee to a related party		10,304		22,500		20,608		45,000
Communications data - related party		3,448		6,120		6,596		11,419
Consumables - related party		-		2,519		576		2,519
Engineering services - related party		36,000		48,000		84,000		96,000
Freight - related party		12		-		62		-
Marketing - related party		62,027		52,530		93,724		102,055
Officers management fees		24,000		24,000		48,000		48,000
Technical service support - related party		12,000		12,000		24,000		24,000
Total operating expenses		157,739		195,439		323,519		388,800

Loss from operations		(133,653)		(175,013)		(288,785)		(331,206)

Other (income) expense:
Capital raising costs		7,437		-		7,438		1,148
Interest		43,919		4,537		75,414		9,672
Interest - related party		4,794		4,447		9,512		8,695
Total Other (income) expense		56,150		8,984		92,364		19,515

Net profit (loss)		(189,803)		(183,997)		(381,149)		(350,721)

Net loss per share - (Basic)	$	(0.00)	$	(0.00)	$	(0.00)	$	(0.00)
Weighted average number of common shares outstanding		164,941,398		161,329,664		163,442,829		159,875,072

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

AS-IP TECH, INC.

STATEMENTS OF STOCKHOLDERS' DEFICIT

(UNAUDITED)

	Preferred	Shares	Common	Stock	Paid-In	Subscriptions	Treasury	Accumulated	Stockholders'
	Shares	Amount	Shares	Amount	Capital	Payable	Stock	Deficit	Equity

Balance @ 30 Jun. 2017	-	-	158,387,871	15,841	10,031,018	26,186	(5)	(10,299,659)	(226,619)
Issue of shares for cash	-	-	3,000,000	300	53,700	-	-	-	54,000
Net Loss for 3 months ended 30 Sep. 2017	-	-	-	-	-	-	-	(166,724)	(166,724)
Balance @ 30 Sep. 2017	-	-	161,387,871	16,141	10,084,718	26,186	(5)	(10,466,383)	(339,343)

Issue of shares for cash	-	-	322,500	32	8,030	-	-	-	8,062
Net Loss for 3 months ended 31 Dec. 2017	-	-	-	-	-	-	-	(183,997)	(183,997)
Balance @ 31 Dec. 2017	-	-	161,710,371	16,173	10,092,748	26,186	(5)	(10,650,380)	(515,278)

Balance @ 30 Jun. 2018	-	-	161,960,376	16,197	10,102,337	26,186	(5)	(11,306,527)	(1,161,812)
Net Loss for 3 months ended 30 Sep. 2018	-	-	-	-	-	-	-	(191,346)	(191,346)
Balance @ 30 Sep. 2018	-	-	161,960,376	16,197	10,102,337	26,186	(5)	(11,497,873)	(1,353,158)

Issue of shares for cash	-	-	8,181,111	818	157,742	-	-	-	158,560
Issue of shares for services	-	-	338,056	34	7,403	-	-	-	7,437
Net Loss for 3 months ended 31 Dec. 2018	-	-	-	-	-	-	-	(189,803)	(189,803)
Balance @ 31 Dec. 2018	-	-	170,479,543	17,050	10,267,481	26,186	(5)	(11,687,676)	(1,376,964)

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,
	2018		2017

Cash flows from operating activities:
Net loss	$	(381,149)	$	(350,721)
Adjustments to reconcile net loss to net cash used by operating activities:
Amortisation of intangibles		20,608		45,000
Changes in operating assets and liabilities
Increase (Decrease) in accounts payable		40,484		12,767
Increase (Decrease) in related party payables		98,875		46,017
Increase (Decrease) in deferred revenue		(239)		(2,874)
Decrease (Increase) in accounts receivable		-		20,154
Decrease (Increase) in prepaid expenses		-		(12,639)
Net cash used in operating activities		(221,421)		(242,296)

Cash flows from investing activities:		-		-

Cash flows from financing activities:
Loans from unrelated parties		21,829		2,172
Advances from unrelated party		-		472,279
Proceeds from issuance of common stock		165,997		62,062
Funds received pending issue of shares		4,650		-
Net cash provided by financing activities		192,476		536,513

Net Increase/(Decrease) in cash		(28,945)		294,217

Cash, beginning of period		40,457		56,569
Cash, end of period	$	11,512	$	350,786

Supplemental disclosure of cash flow information:
Cash paid for income tax		-		-
Cash paid for interest	$	84,926	$	18,367

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

AS-IP TECH, INC.

NOTES TO FINANCIAL STATEMENTS

AS OF DECEMBER 31, 2018

(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, 2018.

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 collectability of accounts receivables, 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.

Earnings (Loss) Per Share

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.

Accounts Receivable, net

Accounts receivable are recognized at invoiced amounts and do not bear interest. The Company maintains an allowance for doubtful accounts for estimated losses resulting from the inability of its customers to make required payments. The Company reviews its allowance for doubtful accounts receivable on an ongoing basis. In establishing the required allowance, management considers any historical losses, the customer’s financial condition, the accounts receivable aging, and the customer’s payment patterns. After all attempts to collect a receivable have failed and the potential for recovery is remote, the receivable is written off against the allowance.

As of December 31, 2018 and 2017, the allowance for doubtful account balances are $0. The bad debt expense, including the direct written-off accounts receivables, incurred for the three months ended December 31, 2018 and December 31, 2017 respectively was $0.

Intangible Assets

In accordance with ASC 350, “Intangibles - Goodwill and Other”, we classify intangible assets into three categories: (1) intangible assets with definite lives subject to amortization; (2) intangible assets with indefinite lives not subject to amortization; and (3) goodwill. For intangible assets with definite lives, tests for impairment must be performed if conditions exist that indicate the carrying value may not be recoverable. For intangible assets with indefinite lives and goodwill, tests for impairment must be performed at least annually or more frequently if events or circumstances indicate that assets might be impaired.

When facts and circumstances indicate that the carrying value of intangible assets determined to have definite lives may not be recoverable, management assesses the recoverability of the carrying value by preparing estimates of future cash flows. If the sum of the expected future cash flows is less than the carrying amount, we recognize an impairment loss. The impairment loss recognized is the amount by which the carrying amount exceeds the fair value which is estimated and calculated by discounted cash flow method. We test intangible assets determined to have indefinite useful lives, including trademarks, franchise rights and goodwill, for impairment annually, or more frequently if events or circumstances indicate that assets might be impaired.

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.

Financial instruments

The Company has adopted the provisions of ASC Topic 820, Fair Value Measurements, which defines fair value, establishes a framework for measuring fair value in GAAP, and expands disclosures about fair value measurements. ASC 820 provides a fair value hierarchy used to classify the source of the information. The fair value hierarchy distinguishes between assumptions based on market data (observable inputs) and an entity’s own assumptions (unobservable inputs). The hierarchy consists of three levels:

Level one - Quoted market prices in active markets for identical assets or liabilities;

Level two - Inputs other than level one inputs that are either directly or indirectly observable; and

Level three - Unobservable inputs developed using estimates and assumptions, which are developed by the reporting entity and reflect those assumptions that a market participant would use.

All of the Company’s financial instruments are level one and are carried at fair value, requiring no adjustment to book value. The financial instruments were deemed to qualify as that classification because their value was determined by the price of identical instruments traded on an active exchange.

Revenue Recognition

The Company recognizes revenue from the sales of goods and services under ASC 606 by applying the following steps: (1) identify the contract with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to each performance obligation in the contract; and (5) recognize revenue when each performance obligation is satisfied. The Company has adopted the modified retrospective method for recording revenue. There was no impact on the Company’s financial statements as a result of adopting Topic 606 for the three months ended December 31, 2018 and 2017.

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 on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. As shown in the accompanying financial statements, the Company has recurring operating losses, limited funds and has accumulated deficits. These factors, among others, may indicate that the Company will be unable to continue as a going concern.

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 for the next twelve months after these financial statements are issued. 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, 2018 and June 30, 2018, the Company has recorded as "related party payables", $449,894 and $351,019, 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 ended December 31, 2018 and December 31, 2017, the Company recorded Interest - related party of $4,794 and $4,447 respectively. In the six months ended December 31, 2018 and December 31, 2017, the Company recorded Interest - related party of $9,512 and $8,695 respectively.

As of December 31, 2018 and June 30, 2018, 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.

In 2016, the Company acquired the BizjetMobile intellectual property from a related party for $450,000. In 2018, management re-assessed the net book value of the intellectual property, and as a result, wrote off $113,832 as a loss of impairment. As of December 31, 2018 and June 30, 2018, the Company has accumulated $260,607 and $240,000 respectively for amortization of the value of the intellectual property.

In the three months ended December 31, 2018 and December 31, 2017 respectively, the Company recorded revenue of $11,699 and $25,244 from entities affiliated through common stockholders and directors for BizjetMobile service fees. In the six months ended December 31, 2018 and December 31, 2017 respectively, the Company recorded revenue of $24,500 and $54,054 from entities affiliated through common stockholders and directors for BizjetMobile service fees. In the three months ended December 31, 2018 and December 31, 2017 respectively, the

Company recorded revenue of $29,970 and $0 from entities affiliated through common stockholders and directors for BizjetMobile system sales. In the six months ended December 31, 2018 and December 31, 2017 respectively, the Company recorded revenue of $29,970 and $21,990 from entities affiliated through common stockholders and directors for BizjetMobile system sales.

In the three months ended December 31, 2018 and December 31, 2017 respectively, the Company incurred expenses of approximately $24,000 and $24,000 respectively to entities affiliated through common stockholders and directors for management expenses. In the six months ended December 31, 2018 and December 31, 2017 respectively, the Company incurred expenses of approximately $48,000 and $48,000 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, 2018 and December 31, 2017 respectively, the Company incurred marketing expense of $62,027 and $52,530 to entities affiliated through common stockholders and directors. In the six months ended December 31, 2018 and December 31, 2017 respectively, the Company incurred marketing expense of $93,724 and $102,055 to entities affiliated through common stockholders and directors.

In the three months ended December 31, 2018 and December 31, 2017 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, 2018 and December 31, 2017 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, 2018 and December 31, 2017 respectively, the Company incurred cost of sales, comprising commissions of $11,323 and $4,818, and hardware cost of sales, of $6,260 and $0 to entities affiliated through common stockholders and directors. In the six months ended December 31, 2018 and December 31, 2017 respectively, the Company incurred cost of sales, comprising commissions of $13,475 and $16,363, and hardware cost of sales, of $6,260 and $2,087 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, 2018 and December 31, 2017 respectively, the Company incurred engineering service costs of $36,000 and $48,000 to entities affiliated through common stockholders and directors, on normal commercial terms in the course of the Company’s normal business. In the six months ended December 31, 2018 and December 31, 2017 respectively, the Company incurred engineering service costs of $84,000 and $96,000 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 six-month period ended December 31, 2018, the Company issued 8,181,111 shares of common stock for cash and 338,056 shares of common stock for services.

The Company has Subscriptions payable of $26,186 which represents 1,422,389 shares of common stock to be issued when directed.

Note 5. Commitments and Contingencies

The Company does not have any arrangements to lease premises for its operations. The Company does not have any legal matters outstanding.

Note 6. Loans

Loans in the Company’s balance sheet is made up of:

1. The Company has an unsecured loan from a third party with balance outstanding at December 31, 2018 of $34,426 (June 30, 2018 $38,281). Interest is calculated at a rate of 20% per annum with interest of $1,775 and $2,128 taken up in the three months ended December 31, 2018 and December 31, 2017 respectively. In the six months ended December 31, 2018 and December 31, 2017 respectively, the Company took up interest of $3,646 and $4,334. The Company is making principal and interest payments for the loan of $1,250 per month, which will increase when cash flow allows.

2. The Company has outstanding unsecured loans totalling $70,295 from shareholders at December 31, 2018 and June 30, 2018. 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, 2018, the Company had accumulated interest on the loans of $6,481 calculated at the Company’s prevailing share price, which included $1,269 for the three months ended December 31, 2018. The interest will be converted to shares of common stock as stated above.

3. In 2018, the Company issued Convertible Notes which totalled $607,500 at December 31, 2018 (balance at June 30, 2018 $585,000) to fund production of its fflya systems. Two issues were made 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 $270,000 is to finance a further 12 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 on terms to be agreed, based on the net revenue received once the systems commence operation,. To date, no systems have been installed and no royalties have been paid. None of the Notes have been converted to shares to date.

Note 7. Intangible Assets

In the year ended June 30, 2016, the Company took up Intangible Assets of $450,000 which represented the termination fee negotiated with the licensee of the Company’s technology. In 2018, management re-assessed the net book value of the intellectual property, and as a result, has written off $113,832 as a Loss of impairment. On the basis that the technology has a useful life of 5 years, the Company has provided for amortization of $240,000 up to June 30, 2018 and $260,607 at December 31, 2018.

Note 8. Subsequent Events

Since December 31, 2018, the Company has continued to raise capital to fund its operations through the sale of shares and has received a total of $483,000 up to the date of this report.

There have not been any significant events since balance date, December 31, 2018 until the date of this report.

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 and six months ended December 31, 2018 and the Form 10-K for the fiscal year ended June 30, 2018.

RESULTS AND PLAN OF OPERATIONS

THREE MONTHS ENDED DECEMBER 31, 2018 COMPARED TO THREE MONTHS ENDED DECEMBER 31, 2017

In the three months period ended December 31, 2018, the Company recorded revenue of $41,669, compared to revenue of $25,244 in the corresponding three month period ended December 31, 2017. After Cost of Sales of $17,583, the Company had a Gross Profit of $24,086 in the three months ended December 31, 2018. In the three months ended December 31, 2017, the Company recorded Cost of Sales of $4,818, which resulted in a Gross Profit of $20,426.

The Company continued investing in the development and marketing of the airline versions of its fflya and CrewX technology. As a result, the product is now in production and has received favourable responses from potential airline customers and strategic partners. In addition, the airline product will be used to upgrade the business jet offering which is expected to open new marketing opportunities for the Company. The Company incurred operating costs of $157,739 in the three months ended December 31, 2018 and $195,439 in the three months ended December 31, 2017. Main components are engineering, management and marketing expenses. In the three months ended December 31, 2018, the Company recorded an Operating Loss of $133,653 compared to an Operating Loss of $175,013 in the three months ended December 31, 2017.

The development and marketing costs have been funded in part through interest bearing convertible notes. As a result, the Company’s Other Expenses, which also included capital raising costs, increased from $8,984 in the three months ended December 31, 2017 to $56,150 in the three months ended December 31, 2018. This resulted in Net Losses of $189,803 and $183,997 in the three months ended December 31, 2018 and 2017 respectively.

SIX MONTHS ENDED DECEMBER 31, 2018 COMPARED TO SIX MONTHS ENDED DECEMBER 31, 2017

In the six month period ended December 31, 2018, the Company recorded revenue of $54,470, compared to revenue of $76,044 in the corresponding six month period ended December 31, 2017. After Cost of Sales of $19,736, the Company had a Gross Profit of $34,734. In the six months ended December 31, 2017, the Company recorded Cost of Sales of $18,450, which resulted in a Gross Profit of $57,594.

The Company’s operating costs decreased from $388,800 in the six months ended December 31, 2017 to $323,519 in the six months ended December 31, 2018. Main components of operating expenses are engineering, management, marketing and trade show expenses. In the six months ended December 31, 2018, the Company recorded an Operating Loss of $288,785 compared to an Operating Loss of $331,206 in the six months ended December 31, 2017.

The development and marketing costs have been funded in part through interest bearing convertible notes. As a result, the Company’s Other Expenses, which also included capital raising costs, increased from $19,515 in the six months ended December 31, 2017 to $92,364 in the six months ended December 31, 2018. This resulted in Net Losses of $381,149 and $350,721 in the six months ended December 31, 2018 and 2017 respectively

LIQUIDITY AND CAPITAL RESOURCES

The cash and cash equivalents balance decreased from $40,457 at June 30, 2018 to $11,512 at December 31, 2018.

The Company reported revenue of $54,470 in the six months ended December 31, 2018 compared to $76,044 in the six month period ended December 31, 2017. The Company incurred a net loss of $288,785 from operating activities for the six months to December 31, 2018, compared to a net loss of $331,206 from operating activities for the six months to December 31, 2017. Net cash used in operating activities for the six months ended December 31, 2018 was $221,421 compared to $242,296 during the six months ended December 31, 2017. Operating cash requirement in the six months ended December 31, 2018 was reduced through increased related party payables.

The cash flow of the Company from financing activities for the six months ended December 31, 2018 was $192,476 as a result of proceeds from issue of common stock and loans from unrelated parties to fund the development and marketing of the fflya and CrewX products. In the six months ended December 31, 2017, the cash flow from financing activities was $536,513 of advances from unrelated parties and from 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, 2018 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, 2018. 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, 2018 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

None

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, 2018:

Nil

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	December 20, 2019
Richard Lukso

By: /s/ Ronald J. Chapman	Director	December 20, 2019
Ronald J. Chapman


By: /s/ Philip A. Shiels	Director	December 20, 2019
Philip A. Shiels


By: /s/ Graham O. Chappell	Director	December 20, 2019
Graham O. Chappell