10-Q/A

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549 

FORM 10-Q/A

 ☑ QUARTERLY REPORT UNDER TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2016

☐ TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission file number 000-30178

VIEW SYSTEMS, INC.

(Exact name of registrant as specified in its charter)

Colorado	59-2928366
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

6 Park Center Court, Owings Mills,  Baltimore, Maryland  21117

(Address of principal executive offices) (Zip Code)

(410) 242-8439

(Registrant's telephone number, including area code)

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 R   No £

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).  Yes    £    No   £

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer £	Accelerated filer £	Non-accelerated filer £	Smaller reporting company R
		(Do not check if a smaller reporting company)

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

 Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date.

Class	Outstanding at August 3, 2017
Common Stock, $.001 par value per share	326,705,526

EXPLANATION NOTE

The purpose of this Amendment No. 1 to View Systems, Inc. Quarterly Report on Form 10-Q/A for the period ended September 30, 2016 (“Form 10-Q”), initially filed with the Securities and Exchange Commission on August 3, 2016, is solely to furnish Exhibit 101 to the Form 10-Q in accordance with Rule 405 of Regulations S-T. Exhibit 101 to this Report provides the condensed consolidated financial statements and related notes from the Form 10-Q formatted in XBRL (eXtensible Business Reporting Language).

No other changes have been made to the Form 10-Q.  This Amendment No .1 to the Form 10-Q speaks as of the original filing date of the Form 10-Q, does not reflect events that may have occurred subsequent to the original filing date, and does not modify or update in any way disclosures made in the original Form 10-Q.

              Pursuant to Rule 406T of Regulation S-T, the interactive data files on Exhibit 101 hereto are deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, are deemed not filed for purposes of Section 18 of the Securities Act of 1034, as amended, and otherwise are not subject to liability under those sections.

1

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. 

	VIEW SYSTEMS, INC.
Date: August 4 , 2017	By:	/s/ Gunther Than
		Gunther Than
		Chief Executive Officer (Principal executive officer, principal financial officer, and principal accounting officer)

2

EX-31

EXHIBIT 31.1

CERTIFICATION PURSUANT TO RULE 13A-14(a) OF THE SECURITIES

EXCHANGE ACT OF 1934, AS ADOPTED PURSUANT TO SECTION

302 OF THE SARBANES OXLEY ACT OF 2002

I, Gunther Than, certify that

1. I have reviewed this quarterly report on Form 10-Q/A for the quarter ended September 30, 2016 of View Systems Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) evaluated the effectiveness of the registrants disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) disclosed in this report any change in the registrants internal control over financial reporting that occurred during the registrants most recent fiscal quarter (the registrants fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrants internal control over financial reporting; and

5. I have disclosed, based on my most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 4 , 2017	By:	/s/ Gunther Than
		Gunther Than
		Chief Executive Officer/Principal Financial Officer

EX-32

Exhibit 32.1

Certification of Principal Executive Officer

Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to

Section 906 of the Sarbanes-Oxley Act of 2002

In connection with the Quarterly Report of View Systems Inc. (the “Company”) on Form 10 -Q/A for the quarter ending September 30, 2016, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), Gunther Than, Chief Executive Officer of the Company, certifies to the best of his knowledge, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.

A signed original of this written statement required by Section 906 has been provided to the Company, and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

By /s/ Gunther Than

Gunther Than

Director, Chief Executive Officer and Chief Financial Officer

August 4, 2017

A signed original of this written statement required by Section 906 of the Sarbanes-Oxley Act of 2002 ("Section 906"), or other document authenticating, acknowledging, or otherwise adopting the signature that appears in typed form within the electronic version of this written statement required by Section 906, has been provided to View System, Inc., and will be retained by View Systems, Inc. and furnished to the Securities and Exchange Commission or its staff upon request.

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Document and Entity Information - shares	9 Months Ended
	Sep. 30, 2016	Aug. 03, 2017
Document And Entity Information
Entity Registrant Name	VIEW SYSTEMS INC
Entity Central Index Key	0001075857
Document Type	10-Q
Document Period End Date	Sep. 30, 2016
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Is Entity a Well-known Seasoned Issuer?	No
Is Entity a Voluntary Filer?	No
Is Entity's Reporting Status Current?	Yes
Entity Filer Category	Smaller Reporting Company
Entity Common Stock, Shares Outstanding		326,705,526
Document Fiscal Period Focus	Q3
Document Fiscal Year Focus	2016

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Consolidated Balance Sheets - USD ($)	Sep. 30, 2016	Dec. 31, 2015
Current Assets
Cash	$ 104	$ 2,617
Accounts receivable	6,109	7,075
Inventory	1,088	1,088
Prepaid Expenses
Total current assets	7,301	10,780
Property and Equipment (Net)	2,397	2,997
Other Assets
Deposits	1,595	1,595
Total other assets	1,595	1,595
Total assets	11,293	15,372
Current Liabilities
Accounts payable	431,358	405,327
Deferred compensation	123,048	37,835
Accrued and withheld payroll taxes payable	183,781	175,184
Accrued interest payable	118,125	95,625
Accrued royalties payable	225,000	225,000
Loans from stockholders	591,208	564,703
Notes payable	50,000	61,095
Deferred revenue	69,523	94,973
Total current liabilities	1,792,043	1,659,742
Non-current Liabilities
Notes payable (non-current portion)
Total liabilities	1,792,043	1,659,742
Stockholders' Deficit
Convertible preferred stock, authorized 10,000,000 shares, $.001 par value, Issued and outstanding 5,589,647; Issued and outstanding 6,089,647	5,590	6,090
Common stock, authorized 950,000,000 shares, $.001 par value, Issued and outstanding 326,705,526; Issued and outstanding 312,205,526	326,705	312,205
Common stock issuable	16,000	16,000
Additional paid in capital	27,392,125	27,389,325
Accumulated deficit	(29,521,170)	(29,367,990)
Total stockholders' deficit	(1,780,750)	(1,644,370)
Total liabilities and stockholders' deficit	$ 11,293	$ 15,372

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Consolidated Balance Sheets (Parenthetical) - $ / shares	Sep. 30, 2016	Dec. 31, 2015
Statement of Financial Position [Abstract]
Preferred Stock Shares Par Value	$ 0.001	$ 0.001
Preferred Stock Shares Authorized	10,000,000	10,000,000
Preferred Stock Shares Issued	5,589,647	6,089,647
Preferred Stock Shares Outstanding	5,589,647	6,089,647
Common Stock Shares Par Value	$ 0.001	$ 0.001
Common Stock Shares Authorized	950,000,000	950,000,000
Common Stock Shares Issued	326,705,526	312,205,526
Common Stock Shares Outstanding	326,705,526	312,205,526

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Consolidated Statements of Operations - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Revenues
Product sales and Installation	$ 2,005	$ 593	$ 7,570	$ 92,480
Extended warranties	5,175	21,214	43,750	53,916
Total revenue	7,180	21,807	51,320	146,396
Cost of sales	(21)	3,996	713	46,984
Gross profit	7,201	17,811	50,607	99,412
Operating expenses
General and administrative	18,036	11,286	40,891	105,268
Professional fees		38,194	5,000	179,820
Salaries and benefits	29,261	62,549	113,296	171,931
Total operating expenses	47,297	112,029	159,187	457,019
Loss from operations	(40,096)	(94,218)	(108,580)	(357,607)
Other Income (expense)
Interest expense	(10,812)	(7,897)	(44,600)	(23,682)
Total other income (expense)	(10,812)	(7,897)	(44,600)	(23,682)
Net loss	$ (50,908)	$ (102,115)	$ (153,180)	$ (381,289)
Net loss per share (basic and diluted)	$ (0.00)	$ (0.00)	$ (0.00)	$ 0.00
Weighted average shares outstanding (basic and diluted)	326,705,526	312,305,526	322,574,464	301,736,478

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Consolidated Statements of Cash Flows - USD ($)	9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015
Cash flows from operating activities:
Net loss	$ (153,180)	$ (381,289)
Adjustments to reconcile net loss to Net cash used in operations:
Depreciation and amortization	600	750
Common stock issued in payment of interest expense	16,800
Interest expense paid with debt		1,176
(Increase) decrease in cash from:
Accounts receivable	966	(8,518)
Deposits		1,277
Increase (decrease) in cash from:
Accounts payable	26,031	24,011
Deferred compensation	85,213	87,552
Accrued interest	22,500	22,500
Payroll taxes accrued and withheld	8,598	2,183
Deferred revenue	(25,450)	34,585
Net cash used in operating activities	(17,922)	(114,023)
Cash flows from financing activities:
Principal payments on notes payable	(11,095)
Loans to/from stockholders	26,505	104,166
Net cash provided by financing activities	15,410	104,166
Decrease in cash	(2,512)	(9,857)
Cash at beginning of period	2,617	13,077
Cash at end of period	104	3,220
Non cash investing and financing activities:
Interest expense paid with common stock	16,800
Loans from stockholders repaid with common stock		10,000
Deferred compensation paid with preferred stock		75,000
Accounts payable paid with common stock		100,000
Notes payable paid by shareholders	11,095	22,445
Issuance of common stock issuable
Cash paid for:
Interest
Income taxes
Common Stock
Adjustments to reconcile net loss to Net cash used in operations:
Stock issued/issuable in payment of services		26,750
Preferred Stock
Adjustments to reconcile net loss to Net cash used in operations:
Stock issued/issuable in payment of services		$ 37,500

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1. NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

9 Months Ended

Sep. 30, 2016

Accounting Policies [Abstract]

1. NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

1.NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Nature of Operations

View Systems, Inc. and Subsidiaries (the "Company") designs, develops and sells computer software and hardware used in conjunction with surveillance capabilities.  The technology utilizes the compression and decompression of digital inputs.  In March 2002, the Company acquired Milestone Technology, Inc., which has developed a concealed weapons detection portal.  In July 2009, the Company acquired FibreXpress, Inc., which is a company that specializes in developing and selling equipment and components for the fiber optic and communication cable industries.

Basis of Consolidation

The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries, Milestone Technology, Inc. and FibreXpress, Inc.  All significant intercompany accounts and transactions have been eliminated in consolidation.

Use of Estimates

Management uses estimates and assumptions in preparing financial statements in accordance with accounting principles generally accepted in the United States of America.  Those estimates and assumptions affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities, and the reported revenues and expenses.  Actual results could differ from the estimates that were used.

Cash and Cash Equivalents

Cash and cash equivalents include all highly liquid investments with original maturities of three months or less

Accounts Receivable

Accounts receivable consists of amounts due from customers.  Management periodically reviews the open accounts and makes a determination as to the ultimate collectability of each account.  Once it is determined that collection is in doubt the account is written off as a bad debt.  In order to provide for accounts that may become uncollectible in the future, the Company has established an allowance for doubtful accounts.  The balance of the allowance for doubtful accounts is based on management's judgment and the Company's prior experience with managing accounts receivable.

The Company recognized bad debt expense of $0 and $0 for the periods ended September 30, 2016 and 2015, respectively.  Management's determination is that the remaining balance is collectible and therefore no allowance for possible uncollectible accounts receivable has been recorded for the periods ended September 30, 2016 and 2015, respectively.

Revenue Recognition

The Company has three main products, namely the concealed weapons detection system, the visual first responder system and the Viewmaxx digital video system.  In all cases revenue is considered earned when the product is shipped to the customer, installed (if necessary) and accepted by the customer as a completed sale.  The concealed weapons detection system and the digital video system each require installation and training.  The customer can engage us for installation and training, which is a revenue source separate and apart from the sale of the product.  In those cases revenue is recognized at the completion of the installation and training and acceptance by the customer.  However, the customer can also self-install or can engage another firm to provide installation and training.  Each product has an unconditional 30 day warranty, during which time the product can be returned for a complete refund.  Customers can purchase extended warranties, which provide for replacement or repair of the unit beyond the period provided by the unconditional warranty.  Warranties can be purchased for various periods but generally they are for one year period that begins after any other warranties expire.  The revenue from warranties is recognized on a straight line basis over the period covered by the warranty.  Prior to the issuance of financial statements management reviews any returns subsequent to the end of the accounting period which are from sales recognized during the accounting period, and makes appropriate adjustments as necessary.  Product prices are fixed or determinable and products are only shipped when collectability is reasonably assured.

Inventories

Inventories stated at the lower of cost or market.  Cost is determined by the first-in-first-out method (FIFO).  As of September 30, 2016 and December 31, 2015 the Company's inventory consisted of unassembled parts of the product.

Property and Equipment

Property and equipment is recorded at cost and depreciated over their useful lives, using the straight-line and accelerated depreciation methods.  Upon sale or retirement, the cost and related accumulated depreciation are eliminated from the respective accounts, and the resulting gain or loss is included in the results of operations.  The useful lives of property and equipment for purposes of computing depreciation are as follows:

Equipment 5-10 years

Software tools 5 years

Repairs and maintenance charges which do not increase the useful lives of assets are charged to operations as incurred.  Depreciation expense for the periods ended September 30, 2016 and 2015 amounted to $600 and $750, respectively.

Income Taxes

Income taxes are recorded under the assets and liabilities method whereby deferred tax assets and liabilities are recognized for the future tax consequences, measured by enacted tax rates, attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss carry forwards.  The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period the rate change becomes effective.  Valuation allowances are recorded for deferred tax assets when it is more likely than not that such deferred tax assets will not be realized.

The Company files income tax returns in the U.S. federal jurisdictions, and in various state jurisdictions.  The Company is no longer subject to U.S. federal, state and local examinations by tax authorities for years prior to 2010.  The Company policy is to recognize interest related to unrecognized tax benefits as income tax expense.  The Company believes that it has appropriate support for the income tax positions it takes and expects to take on its tax returns, and that its accruals for tax liabilities are adequate for all open years based on an assessment of many factors including past experience and interpretations of tax law applied to the facts of each matter.

Research and Development

Research and development costs are expensed as incurred.

Nonmonetary Transactions

Nonmonetary transactions are accounted for in accordance with ASC 845 " Nonmonetary Transactions" which requires the transfer or distribution of a nonmonetary asset or liability to be based generally, on the fair value of the asset or liability that is received or surrendered, whichever is more clearly evident.

Financial Instruments

For most financial instruments, including cash, accounts receivable, accounts payable and accruals, management believes that the carrying amount approximates fair value, as the majority of these instruments are short-term in nature.

Stock-Based Compensation

The Company accounts for share-based compensation at fair value.  Share-based compensation cost for stock options granted to employees, board members and service providers is determined at the grant date using an option pricing model that uses level 3 unobservable inputs.  The value of the award that is ultimately expected to vest is recognized as expense on a straight-line basis over the requisite service period.

Net Loss Per Common Share

Basic net loss per common share is computed by dividing net loss available to common stockholder by the weighted average number of common shares outstanding.  Diluted net loss per common share is computed by dividing net loss available to common stockholders by the weighted average number of common shares and dilutive potential common share equivalents then outstanding.  Potential common shares consist of shares issuable upon the exercise of stock options and warrants in addition to shares that may be issued in the event that convertible debt is exchanged for shares of common stock.  The calculation of the net loss per share available to common stockholders for the periods ended September 30, 2016 and 2015 does not include potential shares of common stock equivalents, as their impact would be antidilutive.  The following reconciles amounts reported in the financial statements:

 

				Weighted Avg
	(Loss)			Shares		Per-share
	(Numerator)			(Denominator)		Amount
Period ended September  30, 2016
Loss from operations which is the amount
that is available to common stockholders	$	(153,180	)		322,757,464	$	(0.00	)
Period ended September 30, 2015
Loss from operations which is the amount
that is available to common stockholders	$	(381,289	)		291,762,120	$	(0.00	)

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2. GOING CONCERN

9 Months Ended

Sep. 30, 2016

Organization, Consolidation and Presentation of Financial Statements [Abstract]

2. GOING CONCERN

2.GOING CONCERN

The Company has incurred and continues to incur, losses from operations.  For the periods ended September 30, 2016 and 2015, the Company incurred net losses of $153,180 and $381,289, respectively, and has a working capital deficiency of $1,784,742 at September 30, 2016..  In addition, certain notes payable have come due and the note holders are demanding payment.

Management is very actively working to cure these situations and has implemented major plans to for the future growth and development of the Company.  Management is in the process of renegotiating more favorable repayment terms on the notes payable and the Company anticipates that these negotiations will result in extended payment plans.  In addition, during 2016 and 2015, the Company implemented marketing and information strategies to increase public awareness of its products and thereby sales.  It has established new international markets which it believes will be the source for sales growth in the very near future.  It also was able to reduce the per-unit cost of manufacturing its products.  Additionally, the Company has increased the efficiency of its processes and focused its development efforts on products that appear to have greater sales potential.

Historically, the Company has financed its operations primarily through private financing.  It is management's intention to finance operations during the remainder of 2016 primarily through increased sales although there will still be a need for additional equity financing.  In addition, management is actively seeking out mergers and acquisitions which would be beneficial to the future growth of the Company.  There can be no assurance, however, that this financing will be successful and the Company may be required to further reduce expenses and scale back operations.

As described in Note 4, the Company is currently in default on a $50,000 loan from a stockholder.

The consolidated financial statements presented above and the accompanying Notes have been prepared on a going concern basis, which contemplates the realization of assets and discharge of liabilities in the normal course of business for the foreseeable future, and does not include any adjustments to reflect possible future effects on the recoverability  and classification of assets, or the amounts and classification of liabilities that may result from the outcome of any extraordinary regulatory action, which would affect our ability to continue as a going concern.

Due to the conditions and events discussed above, there is substantial doubt about the Company's ability to continue as a going concern.

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3. NEW ACCOUNTING PRONOUNCEMENTS

9 Months Ended

Sep. 30, 2016

Organization, Consolidation and Presentation of Financial Statements [Abstract]

3. NEW ACCOUNTING PRONOUNCEMENTS

3.NEW ACCOUNTING PRONOUNCEMENTS

In February 2016, the FASB issued new guidance on the accounting for leases, which supersedes previous lease guidance. Under this guidance, for all leases with terms in excess of one year, including operating leases, the Company will be required to recognize on its balance sheet a lease liability and a right-of-use asset representing its right to use the underlying asset for the lease term. The new guidance retains a distinction between finance leases and operating leases and the classification criteria is substantially similar to previous guidance. Additionally, the recognition, measurement, and presentation of expenses and cash flows arising from a lease by a lessee have not significantly changed. The Company is currently evaluating the impact of this guidance on its consolidated balance sheets. This guidance is effective for interim and annual reporting periods beginning after December 15, 2018, with early adoption permitted.

In May 2014, the FASB issued guidance on the recognition of revenues which provides a single, comprehensive revenue recognition model for all contracts with customers and supersedes most existing revenue recognition guidance. The main principle under this guidance is that an entity should recognize revenue at the amount it expects to be entitled to in exchange for the transfer of goods or services to customers. The Company is currently evaluating the impact of this guidance on its consolidated balance sheets and statement of operations. This guidance is effective for interim and annual reporting periods beginning after December 15, 2017, with early adoption permitted for interim and annual reporting periods beginning after December 15, 2016.

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4. NOTES PAYABLE

9 Months Ended

Sep. 30, 2016

Debt Disclosure [Abstract]

4. NOTES PAYABLE

4.NOTES PAYABLE

Notes payable as of September 30, 2016 and December 31, 2015 consists of the following:

	2016		2015
Lafayette Community Bank A term loan secured by a stockholder, payable in monthly installments of $2,587 commencing in December 25, 2009 but refinanced in May 2011.  The loan was due in full on May 18, 2016 and interest accrues monthly at 5.0% per annum.	$	-	$	11,095
Stockholder Demand loan payable with interest at 5% per month dated September 18, 2009. The loan is secured by the Company's accounts receivable.  The note was payable in full  on December 17, 2009 and is currently in default		50,000		50,000
TOTAL	$	50,000	$	61,095
Less current portion		50,000		61,095
Non-current portion	$	-	$___ _-

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5. INCOME TAXES

9 Months Ended

Sep. 30, 2016

Income Tax Disclosure [Abstract]

5. INCOME TAXES

5.INCOME TAXES

               For income tax purposes the Company has net operating loss carry forwards of $27,915,000 as of December 31, 2015 that may be used to offset future taxable income.  In the instance of future corporate acquisitions, the net operating losses may be used to offset the future taxable income of a qualifying subsidiary corporation which meets IRS regulations governing such situations.  The losses have accumulated since 1998 and they will start to expire in 2018.  IRS regulations also provide that significant changes in ownership (greater than 50%) could result in the expiration of some of the net operating loss carry forwards.  As of  the date of this report the Company has not made an analysis of the changes in ownership to determine if any of these losses have expired.

Net income tax benefit is not recognized at this time because there is no reasonable expectation that the benefit will be realized in the future. Due to continuous losses from operations the Company has assigned a full valuation allowance against its deferred tax assets.

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6.  CONVERTIBLE PREFERRED STOCK

9 Months Ended

Sep. 30, 2016

Equity [Abstract]

6.  CONVERTIBLE PREFERRED STOCK

6. CONVERTIBLE PREFERRED STOCK

In July 2005 the Company issued 7,171,725 shares of Series A Preferred Stock in payment of services.  The issuance had been previously authorized by the Board of Directors.  Each share of Series A Preferred Stock has a liquidation preference, in the event of liquidation of the Company, of $0.001 per share before any payment or distribution is made to the holders of common stock.

During 2008 the Board of Directors approved a reverse split of the stock in which one new share of preferred stock was issued in exchange for each 80 shares of stock outstanding.  Accordingly, the total issued of preferred stock was adjusted from 7,171,725 shares to 89,647 shares.  The par value and the total authorized shares did not change.

Effective in 2010 the initial issuance of  Series A Preferred can be converted into common stock in the ratio of 15:1.  During 2011 the Board of Directors authorized the issuance of an additional 1,400,000 shares of Series A Preferred Stock in payment of a loan from a shareholder in the amount of $64,000 and also in payment of services in the amount of $34,000. These additional shares can be converted to common stock beginning in 2013. Each share is entitled to fifteen votes and shall be entitled to vote on any matters brought to a vote on the common stock shareholder.

During 2012 the Board of Directors authorized the issuance of an additional 1,500,000 shares of Series A Preferred Stock in payment of deferred compensation and current compensation in the amount of $161,463.

During 2013 the Board of Directors authorized the issuance of an additional 500,000 shares of Series A Preferred Stock in payment of professional services in the amount of $225,000.

During 2014 the Board of Directors authorized the issuance of an additional 2,000,000 shares of Series A Preferred Stock in payment of deferred and current compensation in the amount of $480,000.

During 2015 an owner of preferred stock elected to convert 1,400,000 shares of his preferred stock into 21,000,000 shares of the Company's common stock.

During 2015 the Board of Directors authorized the issuance of an additional 2,000,000 shares of Series A Preferred Stock in payment of deferred compensation of $75,000 and current compensation of $75,000.

During 2016 an owner of preferred stock elected to convert 500,000 shares of preferred stock into 7,500,000 shares of the Company's common stock.

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7. OPERATING LEASE

9 Months Ended

Sep. 30, 2016

Leases [Abstract]

7. OPERATING LEASE

7.OPERATING LEASE

The Company leased  a 3,600 sq. ft. office and warehouse space at 1550 Caton Center Drive, Baltimore, Maryland, under a non-cancellable operating  lease which expired in May 2015.  The original base rent was $3,077 per month with a 3% annual rent escalator clause.  Upon its expiration the Company leased 1,500 sq. ft. under a non-cancellable lease at 1900 Lansdowne Road, Baltimore Maryland at a current monthly rent of $1,595 for a period of 3 years.  Minimum annual lease payments over the term of the lease are $19,140 for 2016 and $4,785 for 2017.  Rent expense incurred under these leases was $12,485 and $24,078 for the periods ended September 30, 2016 and 2015, respectively.

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8. STOCK BASED COMPENSATION

9 Months Ended

Sep. 30, 2016

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

8. STOCK BASED COMPENSATION

8.STOCK BASED COMPENSATION

On April 2, 2010 the Company adopted its 2010 Equity Incentive Plan.  Reserved for equity issuances under the Equity Incentive Plan are 50,000,000 shares of our common stock.  During 2011 14,116,433 shares of common stock were issued under the provisions of the 2010 Equity Incentive Plan for which $92,065 of expenses were recognized.

On June 1, 2010 the Company adopted its 2010 Service Provider Stock Compensation Plan.  Reserved for equity issuances under the Service Provider Stock Compensation Plan are 50,000,000 shares of our common stock.  No equity issuances were made during the reporting period from the 2010 Service Provider Stock Compensation Plan.

During the periods ended September 30, 2016 and 2015 the Company issued the following compensatory shares outside of its existing Stock Option and Restricted Share Plans at the discretion of the Board of Directors:

For the nine month period ended September 30, 2016 the Board authorized the issuance of 7,000,000 shares of common stock in payment of interest expense amounting to $16,800.

For the nine month period ended September 30, 2015 the Board authorized the issuance of 8,350,000 shares of common stock in payment of current services and also for services accrued in prior periods amounting to $114,250.

Independent contractors and consultants' expense was based on the estimated value of services rendered or the value of the common stock issued, if more reliably determined.

Stock Options and Warrants

On April 2, 2010, the Company adopted its 2010 Equity Incentive Plan, which authorized, among other forms of incentives, the issuance of stock options.  Reserved for equity issuances under the 2010 Equity Incentive Plan are 50,000,000 shares of our common stock.  No equity issuances have been made from the 2010 Equity Incentive Plan.  Stock options, which may be tax qualified and non-qualified, are exercisable for a period of up to ten years at prices at or above market prices as established on the date of the grant.

Stock Options

Certain nonqualified stock options were issued during the period ended June 30, 2013 to a member of the board of directors as compensation for services performed.

               Weighted            Weighted Average    Aggregate

                                                           Number of       Average Exercise           Remaining              Intrinsic

Options Price                                                                                                ContractualLife           Value

Outstanding at Dec 31, 2015              10,000,000                 $0.03                          2.69                  $     -

Granted                                                         -                             -                                 -                             -

Exercised                                                      -                             -                                 -                             -

Forfeited                                                       -                             -                                 -                             -

Outstanding at Sept 30, 2016             10,000,000                 $0.03                           1.67                $      -

Exercisable at Sept 30, 2016              10,000,000                 $0.03                           1.67                 $      -

The Company uses the Black-Scholes option pricing model to calculate the fair value of options.  Significant assumptions used in this model include:

Annual Dividend                                                                                           -

Expected Life (in years)                                                                                 5.00

Risk Free Interest Rate                                                                                  0.78%

Expected Volatility                                                                                    325.25%

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9. RELATED PARTY TRANSACTIONS

9 Months Ended

Sep. 30, 2016

Related Party Transactions [Abstract]

9. RELATED PARTY TRANSACTIONS

9.     RELATED PARTY TRANSACTIONS

Certain stockholders made cash advances to the Company to help with short-term working capital needs.  The net proceeds from stockholders with unstructured payment plans amounted to $26,505 and $104,166 for the periods ended September 30, 2016 and 2015, respectively.  The total balance due on unstructured loans from stockholders amounted to $591,208 as of September 30, 2016 and $564,703 at December 31, 2015.  Loans from stockholders made with repayment terms are described in Note 4 above.

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10. ISSUABLE COMMON STOCK

9 Months Ended

Sep. 30, 2016

Equity [Abstract]

10. ISSUABLE COMMON STOCK

10.      ISSUABLE COMMON STOCK

              As of September 30, 2016 and December 31, 2015 740,000 shares of the authorized shares of common stock amounting to $16,000, had not been issued

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11. CONTINGENT LIABILITY

9 Months Ended

Sep. 30, 2016

Accounting Policies [Abstract]

11. CONTINGENT LIABILITY

11.  CONTINGENT LIABILITY

        Effective January 1, 2014 the Board of Directors authorized a new employment contract with Gunther Than, CEO of View Systems, Inc.  That employment contract provides that in the event of a change in control of the Board of Directors or a buyout or takeover or substantial change of management structure Mr. Than will receive a minimum of three year's salary plus 4.8 million shares of unrestricted stock of the equivalent in cash at Mr. Than's direction.  Mr. Than's current base salary is $120,000 per annum.

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1. NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)

9 Months Ended

Sep. 30, 2016

Accounting Policies [Abstract]

Nature of Operations

Nature of Operations

View Systems, Inc. and Subsidiaries (the "Company") designs, develops and sells computer software and hardware used in conjunction with surveillance capabilities.  The technology utilizes the compression and decompression of digital inputs.  In March 2002, the Company acquired Milestone Technology, Inc., which has developed a concealed weapons detection portal.  In July 2009, the Company acquired FibreXpress, Inc., which is a company that specializes in developing and selling equipment and components for the fiber optic and communication cable industries.

Basis of Consolidation

Basis of Consolidation

The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries, Milestone Technology, Inc. and FibreXpress, Inc.  All significant intercompany accounts and transactions have been eliminated in consolidation.

Use of Estimates

Use of Estimates

Management uses estimates and assumptions in preparing financial statements in accordance with accounting principles generally accepted in the United States of America.  Those estimates and assumptions affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities, and the reported revenues and expenses.  Actual results could differ from the estimates that were used.

Cash and Cash Equivalents

Cash and Cash Equivalents

Cash and cash equivalents include all highly liquid investments with original maturities of three months or less. 

Accounts Receivable

Accounts Receivable

Accounts receivable consists of amounts due from customers.  Management periodically reviews the open accounts and makes a determination as to the ultimate collectability of each account.  Once it is determined that collection is in doubt the account is written off as a bad debt.  In order to provide for accounts that may become uncollectible in the future, the Company has established an allowance for doubtful accounts.  The balance of the allowance for doubtful accounts is based on management's judgment and the Company's prior experience with managing accounts receivable.

  

The Company recognized bad debt expense of $0 and $0 for the periods ended September 30, 2016 and 2015, respectively.  Management's determination is that the remaining balance is collectible and therefore no allowance for possible uncollectible accounts receivable has been recorded for the periods ended September 30, 2016 and 2015, respectively.

Revenue Recognition

Revenue Recognition

The Company has three main products, namely the concealed weapons detection system, the visual first responder system and the Viewmaxx digital video system.  In all cases revenue is considered earned when the product is shipped to the customer, installed (if necessary) and accepted by the customer as a completed sale.  The concealed weapons detection system and the digital video system each require installation and training.  The customer can engage us for installation and training, which is a revenue source separate and apart from the sale of the product.  In those cases revenue is recognized at the completion of the installation and training and acceptance by the customer.  However, the customer can also self-install or can engage another firm to provide installation and training.  Each product has an unconditional 30 day warranty, during which time the product can be returned for a complete refund.  Customers can purchase extended warranties, which provide for replacement or repair of the unit beyond the period provided by the unconditional warranty.  Warranties can be purchased for various periods but generally they are for one year period that begins after any other warranties expire.  The revenue from warranties is recognized on a straight line basis over the period covered by the warranty.  Prior to the issuance of financial statements management reviews any returns subsequent to the end of the accounting period which are from sales recognized during the accounting period, and makes appropriate adjustments as necessary.  Product prices are fixed or determinable and products are only shipped when collectability is reasonably assured.

Inventories

Inventories

Inventories stated at the lower of cost or market.  Cost is determined by the first-in-first-out method (FIFO).  As of September 30, 2016 and December 31, 2015 the Company's inventory consisted of unassembled parts of the product.

Property and Equipment

Property and Equipment

Property and equipment is recorded at cost and depreciated over their useful lives, using the straight-line and accelerated depreciation methods.  Upon sale or retirement, the cost and related accumulated depreciation are eliminated from the respective accounts, and the resulting gain or loss is included in the results of operations.  The useful lives of property and equipment for purposes of computing depreciation are as follows:

Equipment 5-10 years

Software tools 5 years

Repairs and maintenance charges which do not increase the useful lives of assets are charged to operations as incurred.  Depreciation expense for the periods ended September 30, 2016 and 2015 amounted to $600 and $750, respectively.

s

Income Taxes

Income Taxes

Income taxes are recorded under the assets and liabilities method whereby deferred tax assets and liabilities are recognized for the future tax consequences, measured by enacted tax rates, attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss carry forwards.  The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period the rate change becomes effective.  Valuation allowances are recorded for deferred tax assets when it is more likely than not that such deferred tax assets will not be realized.

The Company files income tax returns in the U.S. federal jurisdictions, and in various state jurisdictions.  The Company is no longer subject to U.S. federal, state and local examinations by tax authorities for years prior to 2010.  The Company policy is to recognize interest related to unrecognized tax benefits as income tax expense.  The Company believes that it has appropriate support for the income tax positions it takes and expects to take on its tax returns, and that its accruals for tax liabilities are adequate for all open years based on an assessment of many factors including past experience and interpretations of tax law applied to the facts of each matter.

Research and Development

Research and Development

Research and development costs are expensed as incurred.

Nonmonetary Transactions

Nonmonetary Transactions

Nonmonetary transactions are accounted for in accordance with ASC 845 " Nonmonetary Transactions" which requires the transfer or distribution of a nonmonetary asset or liability to be based generally, on the fair value of the asset or liability that is received or surrendered, whichever is more clearly evident.

Financial Instruments

Financial Instruments

For most financial instruments, including cash, accounts receivable, accounts payable and accruals, management believes that the carrying amount approximates fair value, as the majority of these instruments are short-term in nature.

Stock-Based Compensation

Stock-Based Compensation

The Company accounts for share-based compensation at fair value.  Share-based compensation cost for stock options granted to employees, board members and service providers is determined at the grant date using an option pricing model that uses level 3 unobservable inputs.  The value of the award that is ultimately expected to vest is recognized as expense on a straight-line basis over the requisite service period.

Net Loss Per Common Share

Net Loss Per Common Share

Basic net loss per common share is computed by dividing net loss available to common stockholder by the weighted average number of common shares outstanding.  Diluted net loss per common share is computed by dividing net loss available to common stockholders by the weighted average number of common shares and dilutive potential common share equivalents then outstanding.  Potential common shares consist of shares issuable upon the exercise of stock options and warrants in addition to shares that may be issued in the event that convertible debt is exchanged for shares of common stock.  The calculation of the net loss per share available to common stockholders for the periods ended June 30, 2016 and 2015 does not include potential shares of common stock equivalents, as their impact would be antidilutive.  The following reconciles amounts reported in the financial statements:

				Weighted Avg
	(Loss)			Shares		Per-share
	(Numerator)			(Denominator)		Amount
Period ended September  30, 2016
Loss from operations which is the amount
that is available to common stockholders	$	(153,180	)		322,757,464	$	(0.00	)
Period ended September 30, 2015
Loss from operations which is the amount
that is available to common stockholders	$	(381,289	)		291,762,120	$	(0.00	)

 

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1. NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)

9 Months Ended

Sep. 30, 2016

Accounting Policies [Abstract]

Net Loss Per Common Share

				Weighted Avg
	(Loss)			Shares		Per-share
	(Numerator)			(Denominator)		Amount
Period ended September  30, 2016
Loss from operations which is the amount
that is available to common stockholders	$	(153,180	)		322,757,464	$	(0.00	)
Period ended September 30, 2015
Loss from operations which is the amount
that is available to common stockholders	$	(381,289	)		291,762,120	$	(0.00	)

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4. NOTES PAYABLE (Tables)

9 Months Ended

Sep. 30, 2016

Debt Disclosure [Abstract]

Notes Payable

	2016		2015
Lafayette Community Bank A term loan secured by a stockholder, payable in monthly installments of $2,587 commencing in December 25, 2009 but refinanced in May 2011.  The loan was due in full on May 18, 2016 and interest accrues monthly at 5.0% per annum.	$	-	$	11,095
Stockholder Demand loan payable with interest at 5% per month dated September 18, 2009. The loan is secured by the Company's accounts receivable.  The note was payable in full  on December 17, 2009 and is currently in default		50,000		50,000
TOTAL	$	50,000	$	61,095
Less current portion		50,000		61,095
Non-current portion	$	-	$___ _-

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8. STOCK BASED COMPENSATION (Tables)

9 Months Ended

Sep. 30, 2016

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Stock Options

Stock Options

Certain nonqualified stock options were issued during the period ended June 30, 2013 to a member of the board of directors as compensation for services performed.

               Weighted            Weighted Average    Aggregate

                                                           Number of       Average Exercise           Remaining              Intrinsic

Options Price                                                                                                ContractualLife           Value

Outstanding at Dec 31, 2015              10,000,000                 $0.03                          2.69                  $     -

Granted                                                         -                             -                                 -                             -

Exercised                                                      -                             -                                 -                             -

Forfeited                                                       -                             -                                 -                             -

Outstanding at Sept 30, 2016             10,000,000                 $0.03                           1.67                $      -

Exercisable at Sept 30, 2016              10,000,000                 $0.03                           1.67                 $      -

Assumptions Used

Annual Dividend                                                                                           -

Expected Life (in years)                                                                                5.00

Risk Free Interest Rate                                                                                  0.78%

Expected Volatility                                                                                    325.25%

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1. NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($)	9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015
Nature Of Operations And Summary Of Significant Accounting Policies Details Narrative
Bad debt expense	$ 0	$ 0
Depreciation Expense	$ 600	$ 750

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1. NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Net Loss Per Common Share (Details) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Nature Of Operations And Summary Of Significant Accounting Policies - Net Loss Per Common Share Details
Net Loss	$ (50,908)	$ (102,115)	$ (153,180)	$ (381,289)
Shares	326,705,526	312,305,526	322,574,464	301,736,478
Per-share			$ 0.00	$ 0.00

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2. GOING CONCERN (Details Narrative) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Net Loss	$ (50,908)	$ (102,115)	$ (153,180)	$ (381,289)
Working Capital Defeciency	1,784,742		1,784,742
Debt in Default	$ 50,000		$ 50,000

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4. NOTES PAYABLE (Details Narrative) - USD ($)	9 Months Ended
	Sep. 30, 2016	Dec. 31, 2015
TOTAL	$ 50,000	$ 61,095
Less current portion	50,000	61,095
Non-current portion
Lafayette Community Bank [Member]
TOTAL		11,095
Monthly Installments	$ 2,587
Due date	May 18, 2016
Interest rate	5.00%
Stockholder [Member]
TOTAL	$ 50,000	$ 50,000
Due date	Dec. 17, 2009
Interest rate	5.00%

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5 INCOME TAXES (Details Narrative)	9 Months Ended
	Sep. 30, 2016 USD ($)
Income Tax Disclosure [Abstract]
Net operating loss carryforwards	$ 27,915,000
Expiration date	Dec. 31, 2018

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6. CONVERTIBLE PREFERRED STOCK (Details Narrative) - USD ($)	9 Months Ended	12 Months Ended
	Sep. 30, 2016	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010	Dec. 31, 2008	Dec. 31, 2005
Stock Issued for Service, Shares			2,000,000
Preferred Stock Outstanding Beginning	6,089,647
Preferred Shares Outstanding Ending	5,589,647	6,089,647
Amount of current and noncurrent compensation			$ 480,000
Conversion of Preferred Shares	500,000	1,400,000
Conversion of Preferred Shares, Common Shares Issued	7,500,000	2,100,000
Preferred Stock
Stock Issued for Service, Shares		2,000,000		500,000	1,500,000				7,171,725
Stock issued in payment of services		$ 75,000		$ 225,000	$ 161,463
Value per share									$ 0.001
Preferred Stock Outstanding Beginning								7,171,725
Preferred Shares Outstanding Ending								89,647
Conversion Ratio							15:1	80:1
Additional Shares Authorized						1,400,000
Common Stock Issued for Payment value						$ 64,000
Amount of current and noncurrent compensation						$ 34,000

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7. OPERATING LEASE (Details Narrative) - USD ($)	9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015
Leases [Abstract]
Base Rent	$ 3,077
Annual Rent Escalator Clause Percentage	3.00%
Monthly Rent	$ 1,595
Rent Expense	12,485	$ 24,078
Minimum Annual Lease Payments, Current Year	19,140
Minimum Annual Lease Payments, Year Two	$ 4,785

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8. STOCK BASED COMPENSATION (Details Narrative) - USD ($)	9 Months Ended		12 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Dec. 31, 2011	Dec. 31, 2010
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Shares for Equity Incentive Plan				50,000,000
Shares issued For Expenses and Liabilitites	7,000,000	8,350,000	14,116,433
Amount of Expenses and Liabilities	$ 16,800	$ 114,250	$ 92,065

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8. STOCK BASED COMPENSATION - Stock Options (Details)	9 Months Ended
	Sep. 30, 2016 $ / shares shares
Stock Based Compensation - Stock Options Details
Stock options, outstanding, beginning | shares	10,000,000
Stock options, outstanding, ending | shares	10,000,000
Stock options, exercisable | shares	10,000,000
Stock options per share, outstanding, beginning | $ / shares	$ 0.03
Stock options per share, outstanding, ending | $ / shares	0.03
Stock options per share, exercisable | $ / shares	$ 0.03
Stock options contractual life, outstanding, beginning	2 years 6 months 9 days
Stock options contractual life,outstanding, ending	1 year 6 months 7 days
Exercisable	1 year 6 months 7 days

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8. STOCK BASED COMPENSATION - Assumptions Used (Details)	9 Months Ended
	Sep. 30, 2016
Share-based Compensation [Abstract]
Expected Life (in years)	5 years
Risk Free Interest Rate	0.78%
Expected Volatility	325.25%

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9. RELATED PARTY TRANSACTIONS (Details Narrative) - USD ($)	9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Dec. 31, 2015
Related Party Transactions [Abstract]
Due to Shareholders	$ 591,208		$ 564,703
Net Proceeds from Stockholders	$ 26,505	$ 104,166

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10. ISSUABLE COMMON STOCK (Details Narrative)	Sep. 30, 2016 USD ($) shares
Equity [Abstract]
Stock unissued, shares | shares	740,000
Stock unissued, value | $	$ 16,000

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11. CONTINGENT LIABILITY (Details Narrative)	9 Months Ended
	Sep. 30, 2016 USD ($) shares
Contingent Liability Details Narrative
Base Salary | $	$ 120,000
Shares Issued as Salary | shares	4,800,000