10-K/A

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON D.C. 20549

____________________

FORM 10-K/A

Amendment No. 1 to Form 10-K

x  ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended: August 31, 2013

or

¨  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _________ to _________

Commission file number: 000-53446

Infinity Augmented Reality, Inc.

(Exact Name of Registrant as Specified in its Charter)

Nevada	71-1013330
(State or Other Jurisdiction of Incorporation)	(I.R.S. Employer Identification No.)

2220 Nostrand Avenue Brooklyn, New York	11210
(Address of Principal Executive Offices)	(Zip Code)

Registrant’s telephone number, including area code: (212) 201-4070

Securities registered pursuant to Section 12(b) of the Exchange Act: None

Securities registered pursuant to Section 12(g) of the Exchange Act:  

Common Stock, 0.00001 Par Value

(Title of Class)

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ¨No x

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes xNo ¨

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 xNo ¨ ..

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 during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x. No ¨

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of Registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.  x

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or 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	¨(Do not check if a smaller reporting company)	Smaller reporting company	x

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

The aggregate market value of the voting and non-voting common equity of the registrant held by non-affiliates, computed by reference to the average bid and asked price of such stock, as of February 28, 2013 (second quarter prior to the end of our fiscal year) was approximately $19,126,236 (for purposes of determination of the aggregate market value, only directors, executive officers and 10% or greater stockholders have been deemed affiliates.)

The number of shares outstanding of the registrant’s common stock, par value $0.00001 per share, as of December 24, 2013, was 93,628,551 shares.

Explanatory Note –

The purpose of this Amendment No. 1 to Infinity Augmented Reality, Inc.’s Annual Report on Form 10-K for the year ended August 31, 2013, filed with the Securities and Exchange Commission on December 23, 2013 (the “Form 10-K”), is solely to furnish Exhibit 101 to the Form 10-K in accordance with Rule 405 of Regulation S-T. Exhibit 101 to this report provides the consolidated financial statements and related notes from the Form 10-K formatted in XBRL (eXtensible Business Reporting Language).

No other changes have been made to the Form 10-K.  This Amendment No. 1 to the Form 10-K speaks as of the original filing date of the Form 10-K, 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-K.

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 Exchange Act of 1934, as amended, and otherwise are not subject to liability under those sections.

Item 6. Exhibits.

Exhibit  Number	Description
31.1	Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. *
31.2	Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. *
32.1	Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act. *
32.2	Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act . *
101.INS	XBRL Instance Document
101.SCH	XBRL Taxonomy Extension Schema Document
101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF	XBRL Taxonomy Extension Definition Linkbase Document
101.LAB	XBRL Taxonomy Extension Label Linkbase Document
101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document

*           These exhibits were previously included or incorporated by reference in Infinity Augmented Reality, Inc.’s Annual Report on Form 10-K for the year ended August 31, 2013, filed with the Securities and Exchange Commission on December 23, 2013.

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this Form 10-K/A to be signed on its behalf by the undersigned, thereunto duly authorized.

INFINITY AUGMENTED REALITY, INC.
January 7, 2014	/s/ Enon Landenberg
	Enon Landenberg
	President and Chief Executive Officer
	(Principal Executive Officer)

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

Signature	Capacity in which signed	Date
/s/ Enon Landenberg
Enon Landenberg	President and Chief Executive Officer (Principal Executive Officer )	January 7, 2014

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RELATED PARTY TRANSACTIONS

12 Months Ended

Aug. 31, 2013

RELATED PARTY TRANSACTIONS [Abstract]

RELATED PARTY TRANSACTIONS

9. RELATED PARTY TRANSACTIONS

During the year ended August 31, 2013, the Company received a short-term loan from a principal shareholder of $200,000 (the "Note"). The Note was at a rate of 8% per annum with a maturity date ending on or before May 31, 2013. On May 7, 2013, the shareholder assigned all rights, title and interest in the Note to an affiliate of the principal shareholder. On May 22, 2013, the holder exchanged a total of $202,543 (loan principal of $200,000 and accrued interest of $2,543) for a Convertible Debenture pursuant to a Securities Purchase Agreement as discussed in Note 5.

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CONSOLIDATED STATEMENTS OF OPERATIONS (USD $)	9 Months Ended	12 Months Ended
	Aug. 31, 2013	Aug. 31, 2013	Aug. 31, 2012
CONSOLIDATED STATEMENTS OF OPERATIONS [Abstract]
General and administrative expenses	$ (6,527,215)	$ (6,706,494)	$ (143,753)
Research and development	(133,704)	(133,704)
Total operating expenses	(6,660,919)	(6,840,198)	(143,753)
Other expense
Foreign exchange loss	(7,136)	(7,136)
Interest expense	(67,667)	(67,667)
Loss from continuing operations before income tax	(6,735,722)	(6,915,001)	(143,753)
Income tax (provision) benefit	(78,637)	(190,652)	64,689
Loss from continuing operations	(6,814,359)	(7,105,653)	(79,064)
Loss from discontinued operations (including loss on disposal of life settlement contracts of $8,438,584 for the year ended August 31, 2013, respectively), net of tax		(4,318,440)	(22,367,220)
Net loss	(6,814,359)	(11,424,093)	(22,446,284)
Deemed dividend on issuance of Series A and Series B Preferred Stock			(932,643)
Dividend on Convertible Preferred Stock			(4,580,642)
Net loss applicable to common shareholders	(6,814,359)	(11,424,093)	(27,959,569)
Basic and diluted loss per common share
Continuing operations		$ (0.07)
Discontinued operations		$ (0.04)	$ (0.30)
Net loss per common share		$ (0.11)	$ (0.30)
Basic weighted average shares outstanding		98,413,541	93,997,860
Diluted weighted average shares outstanding		98,413,541	93,997,860
Net loss	(6,814,359)	(11,424,093)	(27,959,569)
Foreign currency translation adjustments		(1,422)
Comprehensive loss		$ (11,425,515)	$ (27,959,569)

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SIGNIFICANT ACCOUNTING POLICIES

12 Months Ended

Aug. 31, 2013

SIGNIFICANT ACCOUNTING POLICIES [Abstract]

SIGNIFICANT ACCOUNTING POLICIES

2. SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The consolidated financial statements of the Company as of August 31, 2013 and 2012 and for the years then ended have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP"). The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiary. All significant intercompany accounts and transactions are eliminated in the consolidation process.

Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The Company regularly evaluates estimates and assumptions. The Company bases its estimates and assumptions on current facts, historical experience and various other factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources. The actual results experienced by the Company may differ materially and adversely from the Company's estimates. To the extent there are material differences between the estimates and the actual results, future results of operations will be affected. The most significant estimates with regard to these financial statements relate to the value of warrants and options and deferred income tax amounts and rates and timing of the reversal of income tax differences.

Development Stage Company

Effective November 15, 2012, the Company is considered a development stage company, having no operating revenues during the period from November 15, 2012 ("Inception") to August 31, 2013, as defined by ASC 915-205, Development-Stage Entities. ASC 915-205 requires companies to report their operations, shareholders equity and cash flows upon entering the development stage through the date that revenues are generated. From November 15, 2012 through August 31, 2013, all operating expenses of the Company related to its augmented reality business and is included in the Consolidated Statements of Operations. The Company had operating expenses of $179,279 and $143,753 respectively for the period from September 1, 2012 to November 15, 2012 and the period from June 1, 2012 to August 31, 2012 respectively, relating to its augmented reality business.

Cash and Cash Equivalents

The Company considers all short term investments with an original maturity of three months or less to be cash equivalents. The Company maintains cash balances that may be uninsured or in deposit accounts that exceed Federal Deposit Insurance Corporation limits. The Company maintains its cash deposits with major financial institutions.

Reclassifications

During the year ended August 31, 2013, the Company disposed of all its life settlement contracts. As of August 31, 2013, all of the operations related to the life settlement business, as well as any resulting gain or loss recognized from the disposal, have been reported as discontinued operations in the consolidated financial statements. The Company has also reported the prior period operations related to this business as discontinued operations retrospectively for all periods presented. Additionally, the assets and liabilities related to the life settlements business have been classified as discontinued operations in the consolidated balance sheets for all periods presented. See Note 3 - Discontinued Operations  for more information.

Financial Instruments

The fair value of certain of the Company's financial instruments, consisting of cash, accounts payable and accrued expenses are estimated to be equal to their carrying value due to the short-term nature of these instruments. It is management's opinion that the Company is not exposed to significant interest, currency and credit risks arising from these financial instruments.

Leasehold Improvements and Equipment

Equipment consists of computer hardware and furniture and is recorded at cost. Computer hardware and furniture are depreciated on a straight-line basis over their estimated lives of five years. Leasehold improvements are amortized on a straight-line basis over the lease life of two years.

Deferred Rent

The Company's prior operating lease provided for minimum annual payments that adjusted over the life of the lease. The aggregate minimum annual payments were expensed on the straight-line basis over the minimum lease term. The Company recognized a deferred rent liability for rent escalations when the amount of straight-line rent exceeded the lease payments, and reduced the deferred rent liability when the lease payments exceed the straight-line rent expense. As of August 31, 2013, the Company has no deferred rent liability.

Software Development Costs

The Company applies the principles of ASC 985-20, Software- Costs of Software to Be Sold, Leased, or Marketed, which requires that software development costs incurred in conjunction with product development be charged to research and development expense until technological feasibility is established. Thereafter, until the product is released for sale, software development costs must be capitalized and reported at the lower of unamortized cost or net realizable value of the related product. The Company has adopted the "tested working model" approach to establishing technological feasibility for its products. Under this approach, a product in development is not considered to have passed the technological feasibility milestone until the Company has produced a model of the product that contains essentially all the functionality and features of the final product and have tested the model to ensure that it works as expected. The Company has expensed all software development costs when incurred since none of the Company's products have reached technological feasibility.

Foreign Currency Translation

The financial statements are presented in United States dollars. In accordance with ASC 830, Foreign Currency Matters, foreign denominated monetary assets and liabilities are translated to their United States dollar equivalents using foreign exchange rates which prevailed at the balance sheet date. Non-monetary assets and liabilities are translated at exchange rates prevailing at the transaction date. Revenue and expenses are translated at average rates of exchange during the periods presented. Related translation adjustments are reported as a separate component of stockholders' equity (deficit), whereas gains or losses resulting from foreign currency remeasurement and transactions are included in results of operations.

Income Taxes

Deferred income taxes are provided for tax effects of temporary differences between the tax basis of asset and liabilities and their reported amounts in the financial statements. The Company uses the liability method to account for income taxes, which requires deferred taxes to be recorded at the statutory rate expected to be in effect when the taxes are paid. Valuation allowances are provided for a deferred tax asset when it is more likely than not that such asset will not be realized.

Management evaluates tax positions taken or expected to be taken in a tax return. The evaluation of a tax position includes a determination of whether a tax position should be recognized in the financial statements, and such a position should only be recognized if the Company determines that it is more likely than not that the tax position will be sustained upon examination by the tax authorities, based upon the technical merits of the position. For those tax positions that should be recognized, the measurement of a tax position is determined as being the largest amount of benefit that is greater than fifty percent likely of being realized upon ultimate settlement.

The Company's policy for recording interest and penalties associated with audits is to record such expense as a component of income tax expense.

Loss per Share

Basic loss per share is calculated using the weighted average number of shares of common stock outstanding during the period. Included in basic loss per share calculations are the effects of 6,000,000 warrants exercisable at $0.01. Diluted earnings per share reflect the potential dilution that could occur if potentially dilutive securities were exercised or converted to common stock. The dilutive effect of options and warrants and their equivalent is computed by application of the treasury stock method and the effect of convertible securities by the "if converted" method. For the year ended August 31, 2013, 30,450,344 shares of common stock, comprised of 7,710,172 convertible debentures with a conversion price of $0.25, 7,710,172 warrants with an exercise price of $0.50, and stock options exercisable into 22,430,000 common shares are not included in diluted earnings per share since their effect would be anti-dilutive. For the year ended August 31, 2012, 27,700,000 and 28,142,500 warrants with an exercise price of $2.00 and $4.00 respectively, and 55,400 Series A and Series B preferred shares, convertible into 55,400,000 common shares are not included in diluted earnings per share since their effect would be anti-dilutive.

Stock-Based Compensation

The Company records stock-based compensation expense in accordance with  ASC 718, Compensation - Stock Compensation. The Company expenses stock-based compensation to employees over the requisite service period based on the estimated grant-date fair value of the awards and forfeiture rates. For stock-based compensation awards to non-employees, the Company re-measures the fair value of the non-employee awards at each reporting period prior to vesting and finally at the vesting date of the award. The assumptions used in calculating the fair value of stock-based awards represent management's best estimates and involve inherent uncertainties and the application of management's judgment.

Recent Accounting Pronouncements

In March 2013, the FASB issued ASU 2013-07, "Presentation of Financial Statements (Topic 205): Liquidation Basis of Accounting." The amendments require an entity to prepare its financial statements using the liquidation basis of accounting when liquidation is imminent. Liquidation is imminent when the likelihood is remote that the entity will return from liquidation and either (a) a plan for liquidation is approved by the person or persons with the authority to make such a plan effective and the likelihood is remote that the execution of the plan will be blocked by other parties or (b) a plan for liquidation is being imposed by other forces (for example, involuntary bankruptcy). If a plan for liquidation was specified in the entity's governing documents from the entity's inception (for example, limited-life entities), the entity should apply the liquidation basis of accounting only if the approved plan for liquidation differs from the plan for liquidation that was specified at the entity's inception. The amendments require financial statements prepared using the liquidation basis of accounting to present relevant information about an entity's expected resources in liquidation by measuring and presenting assets at the amount of the expected cash proceeds from liquidation. The entity should include in its presentation of assets any items it had not previously recognized under U.S. GAAP but that it expects to either sell in liquidation or use in settling liabilities (for example, trademarks). The amendments are effective for entities that determine liquidation is imminent during annual reporting periods beginning after December 15, 2013, and interim reporting periods therein. Entities should apply the requirements prospectively from the day that liquidation becomes imminent. Early adoption is permitted. The adoption of this standard is not expected to have a material impact on the Company's financial position and results of operations.

In July 2013, the FASB issued ASU 2013-11, "Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists." ASU 2013-11 provides guidance on the presentation of unrecognized tax benefits related to any disallowed portion of net operating loss carryforwards, similar tax losses, or tax credit carryforwards, if they exist. ASU 2013-11 is effective for fiscal years beginning after December 15, 2013. The adoption of this standard is not expected to have a material impact on the Company's financial position and results of operations.

Other pronouncements issued by the FASB or other authoritative accounting standards groups with future effective dates are either not applicable or are not expected to be significant to the financial statements of the Company.

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SIGNIFICANT ACCOUNTING POLICIES (Details) (USD $)	3 Months Ended		9 Months Ended	12 Months Ended				12 Months Ended
	Nov. 15, 2012	Aug. 31, 2012	Aug. 31, 2013	Aug. 31, 2013	Aug. 31, 2012	Jul. 31, 2012 Exercise Price One [Member]	Jul. 31, 2012 Exercise Price Two [Member]	Aug. 31, 2013 Common Stock [Member]	Aug. 31, 2013 Convertible Debentures [Member]	Aug. 31, 2013 Warrants [Member]	Aug. 31, 2013 Stock Options [Member]	Aug. 31, 2012 Warrants with Exercise Prices of $2.00 and $4.00 [Member] Exercise Price One [Member]	Aug. 31, 2012 Warrants with Exercise Prices of $2.00 and $4.00 [Member] Exercise Price Two [Member]	Aug. 31, 2012 Series A Convertible Preferred Stock [Member]	Aug. 31, 2012 Series B Convertible Preferred Stock [Member]
SIGNIFICANT ACCOUNTING POLICIES [Abstract]
Operating expenses	$ 179,279	$ 143,753	$ 6,660,919	$ 6,840,198	$ 143,753
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Warrants outstanding			6,000,000	6,000,000
Exercise price of warrants			$ 0.01	$ 0.01		$ 2	$ 4			$ 0.50		$ 2.00	$ 4.00
Antidilutive securities not included in computation of earnings per common share								30,450,344	7,710,172	7,710,172	22,430,000	27,700,000	28,142,500	55,400	55,400
Conversion price									$ 0.25
Convertible Preferred Stock, Shares Issued upon Conversion		55,400,000			55,400,000

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SUBSEQUENT EVENTS

12 Months Ended

Aug. 31, 2013

SUBSEQUENT EVENTS [Abstract]

SUBSEQUENT EVENTS

10. SUBSEQUENT EVENTS

Subsequent to year end, the Company terminated the At-Will Employment Agreement with Helen Papagiannis and entered into a consulting agreement with Helen Papagiannis pursuant to which she will continue to serve as the Chief Innovation Officer of the Company. The essential terms of the consulting agreement are similar to the prior At-Will Employment Agreement except for minor amended terms.

On September 11, 2013, the Board of Directors (the "Board") of Infinity Augmented Reality, Inc. (the "Company") elected Ori Inbar as a director. In connection with his election to the Company's Board, Mr. Inbar will receive a monthly retainer fee of $2,000 and was granted 100,000 Non-Qualified Stock Options with an exercise price of $0.29 (the "Options"), vesting semiannually over the next 2 years (at the beginning of the Company's quarterly reporting date, i.e. March 1 and September 1), and expire 5 years from each vesting date. 25,000 (or 25%) Options shall initially vest on March 1, 2014 and expire on February 28, 2019. These Options shall be subject to the terms and conditions of the Company's 2013 Equity Incentive Plan and a written stock option agreement.

On September 17, 2013, the Company issued Convertible Debentures and received aggregate proceeds of $350,000.

On October 9, 2013, the Company issued Convertible Debentures and received aggregate proceeds of $325,000.

On November 7, 2013, the Company issued Convertible Debentures and received aggregate proceeds of $325,000.

On November 18, 2013, a consultant exercised 399,260 options at an exercise price of $0.10 per share. The Company received cash proceeds of $39,926 on exercise of those options.

On December 5, 2013, the Company issued Convertible Debentures and received aggregate proceeds of $325,000.

On December 19, 2013, the Company issued Convertible Debentures and received aggregate proceeds of $375,000.

Effective November 1, 2013, Infinity Israel entered into an Employment Agreement with Ortal Zanzuri pursuant to which she will serve as the Chief Financial Officer of Infinity Israel. On November 11, 2013, the Board of the Company unanimously resolved to approve Ortal's employment agreement and resolved to appoint Ortal as the Chief Financial Officer of the Company, effective on January 1, 2014. The Board also accepted the resignation of Mr. Joshua Yifat, effective on December 31, 2013. In connection with her appointment as Chief Financial Officer, Ms. Zanzuri will receive annual compensation of 480,000 New Israeli Shekel (approximately $136,000 based on foreign exchange rate as of November 1, 2013) and will be granted 200,000 Non-Qualified Stock Options with an exercise price, vesting and expiration dates as determined by the Board (the "Options"). These Options shall be subject to the terms and conditions of the Company's adoption of an Israeli Employee Sub-Plan under the Company's 2013 Equity Incentive Plan and a written stock option agreement.

On November 27, 2013, Infinity Israel received a pre lawsuit claim letter from the legal representative of its former employee. Infinity Israel intends to contest the lawsuit and has instructed its legal counsel to prepare a response letter. The compensation amount sought by the former employee as per his pre lawsuit claim letter is approximately 202,000 NIS (approximately $57,000 based on foreign exchange rate as of November 27, 2013). Due to the early stage of the lawsuit, an evaluation of the likelihood of an unfavorable outcome cannot be made at this time.

The Company evaluates events that have occurred after the balance sheet date through the date the financial statements were publicly available. Based upon the evaluation, the Company did not identify any other recognized or non-recognized subsequent events that would have required adjustment to or disclosure in the financial statements.

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INCOME TAXES (Schedule of Effective Tax Rate Reconciliation) (Details)	12 Months Ended
	Aug. 31, 2013	Aug. 31, 2012
INCOME TAXES [Abstract]
United States statutory rate	(35.00%)	(35.00%)
State income taxes	(10.00%)	(10.00%)
Foreign earnings taxed at different rates	1.00%
Increase in valuation allowance and other	41.00%
Combined effective tax rate	(3.00%)	(45.00%)

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CONVERTIBLE NOTE RECEIVABLE (Details) (Convertible Note Receivable [Member], Meta Company [Member], USD $)	0 Months Ended
	Jul. 10, 2013
Convertible Note Receivable [Member] | Meta Company [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Amount	$ 50,000
Interest rate	5.00%
Maturity	Jul. 31, 2014
Terms of conversion	The Note is convertible into common shares of Meta Company at conversion price of 80% of the price of common equity sold in a Qualified Offering of at least $1,000,000. The note is carried at cost which approximates fair value.

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DISCONTINUED OPERATIONS (Narrative) (Details) (USD $)	12 Months Ended
	Aug. 31, 2013
DISCONTINUED OPERATIONS [Abstract]
Proceeds from life settlement contract maturity	$ 10,000,000
Discontinued operations, outstanding obligations	9,378,807
Deferred income tax asset, NOL from discontinued operations	145,781
Income taxes payable	775,000
Interest and penalties	75,000
ALS Capital Ventures LLC [Member]
Debt Instrument [Line Items]
Premiums payable	1,170,526
Term Loan [Member]
Debt Instrument [Line Items]
Interest payable	2,123,281
Revolving Loan [Member]
Debt Instrument [Line Items]
Interest payable	114,000
Debt, net amount	5,971,000
Debt, gross amount	$ 6,085,000

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COMMON STOCK, WARRANTS AND OPTIONS (Schedule of Stock-Based Compensation Expense) (Details) (USD $)	9 Months Ended	12 Months Ended
	Aug. 31, 2013	Aug. 31, 2013	Aug. 31, 2012
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock compensation expense	$ 4,511,362	$ 4,511,362
Employee Stock Option [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock compensation expense		155,714
Non-Employee Award [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock compensation expense		$ 4,355,648

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INCOME TAXES (Narrative) (Details) (USD $)		12 Months Ended		12 Months Ended
	Aug. 31, 2013	Aug. 31, 2013 Capital Loss Carryforward [Member]	Aug. 31, 2013 Federal, State, and Local [Member]	Aug. 31, 2013 Israel [Member]	Aug. 31, 2013 Israel [Member] Available To Be Carried Forward Indefinitely [Member]	Aug. 31, 2012 Israel [Member] Available To Be Carried Forward Indefinitely [Member]
Operating Loss Carryforwards [Line Items]
Net operating losses			$ 1,974,000	$ 1,298,000	$ 340,000	$ 0
Net operating losses carried forward, expiration date				Aug. 31, 2032
Valuation allowance	523,000
Capital losses		3,150,000
Capital loss carryforward, expiration date		Aug. 31, 2018
Capital loss carryforward, valuation allowance		$ 1,420,000

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PREFERRED STOCK (Details) (USD $)	0 Months Ended	12 Months Ended		0 Months Ended					0 Months Ended	3 Months Ended	12 Months Ended	0 Months Ended	12 Months Ended
	Jul. 31, 2012	Aug. 31, 2012	Aug. 31, 2013	Jul. 25, 2012 Dividends Due Date One [Member]	Jul. 25, 2012 Dividends Due Date Two [Member]	Jul. 31, 2012 Dividends Due Date Three [Member]	Jul. 31, 2012 Exercise Price One [Member]	Jul. 31, 2012 Exercise Price Two [Member]	Jul. 31, 2012 Series A Convertible Preferred Stock [Member]	Feb. 29, 2012 Series A Convertible Preferred Stock [Member]	Aug. 31, 2012 Series A Convertible Preferred Stock [Member]	Jul. 31, 2012 Series B Convertible Preferred Stock [Member]	Aug. 31, 2012 Series B Convertible Preferred Stock [Member]
Preferred Stock [Line Items]
Preferred stock, shares authorized		100,000,000	100,000,000
Preferred stock, par value (in dollars per share)		$ 0.00001	$ 0.00001
Dividend due date				Dec. 31, 2011	Jun. 30, 2012	Jul. 31, 2012
Stock dividends paid on preferred stock, Shares				3,201,093	3,315,754	603,303
Stock dividends paid on preferred stock				$ 3,233,104	$ 1,160,514	$ 187,024
Conversion price											$ 1.00		$ 1.00
Deemed dividends on preferred stock										932,643
Private placement of shares										2,500	6,350
Repurchase of preferred stock, shares									48,300		48,300	8,850	8,850
Repurchase of preferred stock	57,150,000	57,150,000
Purchase price for repurchased preferred stock	$ 57,150,000
Number of shares available for warrants exercised	57,592,500
Exercise price of warrants			$ 0.01				$ 2	$ 4

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DISCONTINUED OPERATIONS (Condensed Statement of Operations and Condensed Balance Sheets) (Details) (USD $)	12 Months Ended
	Aug. 31, 2013	Aug. 31, 2012
DISCONTINUED OPERATIONS [Abstract]
Sales, general and administrative expenses	$ (204,200)	$ (2,175,602)
Other income (expense)
Realized gain on life settlement contracts held under investment method		319,843
Realized loss on extinguishment of debt	(8,438,584)
Change in fair value of life settlement contracts net of premiums paid	2,055,438	(36,460,974)
Interest expense	(1,610,571)	(626,710)
Loss from discontinued operations before income tax	(8,197,917)	(38,943,443)
Income tax benefit	3,879,477	16,576,223
Net loss from discontinued operations	(4,318,440)	(22,367,220)
ASSETS
Cash and cash equivalents		228,165
Investment in life settlement contracts at investment method		4,334,012
Total current assets of discontinued operations		4,562,177
Investment in life settlement contracts at fair value		64,667,124
Deferred income taxes	145,781
Total noncurrent assets of discontinued operations	145,781	64,667,124
LIABILITIES
Interest payable		626,710
Loans payable		59,450,000
Income and other taxes payable	775,000
Total current liabilities of discontinued operations	775,000	60,076,710
Deferred income taxes		4,433,696
Total long-term liabilities of discontinued operations		$ 4,433,696

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CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $)	9 Months Ended	12 Months Ended
	Aug. 31, 2013	Aug. 31, 2013	Aug. 31, 2012
OPERATING ACTIVITIES
Net loss	$ (6,814,359)	$ (11,424,093)	$ (22,446,284)
Loss from discontinued operations		4,318,440	22,367,220
Adjustments to reconcile net loss to net cash (used in) provided by operations
Amortization of debt discount	61,218	61,218
Foreign exchange gain on investment in subsidiary	1,157	1,157
Stock-based compensation	4,511,362	4,511,362
Stock forfeited by stockholders to settle payment of withholding tax on behalf of such stockholders	(5,645)	(5,645)
Payment-in-kind interest on shareholder loan	2,543	2,543
Loss on disposition of equipment	13,161	13,161
Amortization of leasehold improvements	3,790	3,790
Depreciation	18,128	23,118	23,953
Deferred rent	(63,638)	(49,335)	7,187
Deferred income taxes	78,637	190,652	79,064
Changes in operating assets and liabilities
Prepaid expenses	(2,791)	(6,141)	29,852
Security deposit	(29,222)	(29,222)
Accounts payable and accrued expenses	19,338	(70,090)	396,690
Interest payable	3,906	3,906
Net cash (used in) provided by operating activities- continuing operations	(2,202,415)	(2,455,179)	457,682
Net cash (used in) provided by operating activities- discontinued operations	5,858,675	(6,427,044)	(10,097,013)
Net cash (used in) provided by operating activities	3,656,260	(8,882,223)	(9,639,331)
INVESTING ACTIVITIES
Purchase of convertible note	(50,000)	(50,000)
Proceeds received from sale of equipment	5,200	5,200
Purchase of leasehold improvements and equipment	(104,825)	(104,825)
Net cash used in investing activities- continuing operations	(149,625)	(149,625)
Net cash provided by investing activities- discontinued operations		9,756,718	994,216
Net cash provided by (used in) investing activities	(149,625)	9,607,093	994,216
FINANCING ACTIVITIES
Proceeds from convertible debentures	1,725,000	1,725,000
Proceeds from exercise of stock options	80,000	80,000
Proceeds from shareholder loan	200,000	200,000
Net cash provided by financing activities- continuing operations	2,005,000	2,005,000
Net cash (used in) provided by financing activities- discontinued operations	(5,135,000)	(2,300,000)	8,650,000
Net cash (used in) provided by financing activities	(3,130,000)	(295,000)	8,650,000
Effect of exchange rate on cash and cash equivalents	(2,995)	(2,995)
Change in cash and cash equivalents	373,640	426,875	4,885
Cash and cash equivalents, beginning	58,120	4,885
Cash and cash equivalents, ending	431,760	431,760	4,885
Non-cash financing activities:
Conversion of shareholder loan into convertible debentures	202,543	202,543
Warrants issued in connection with convertible debentures	818,712	818,712
Fair value of conversion option	1,041,722	1,041,722
Term loan issued for repurchase of preferred stock which is included in discontinued operations			$ 57,150,000

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CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY (DEFICIT) (Paranthetical) (USD $)	12 Months Ended
	Aug. 31, 2013	Aug. 31, 2012
CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY (DEFICIT) [Abstract]
Per share value of equity issued	$ 0.29	$ 1,000

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DISCONTINUED OPERATIONS

12 Months Ended

Aug. 31, 2013

DISCONTINUED OPERATIONS [Abstract]

DISCONTINUED OPERATIONS

3. DISCONTINUED OPERATIONS

Effective November 15, 2012, the Company reached an agreement with the agent of the Lenders regarding the satisfaction of the outstanding balance of the Loans, under the terms of a Loan Satisfaction Agreement. Such agreement resulted in the disposition of all of the life settlement contracts that were held by the Company to the Lender or an affiliate of the Lender. All of the operations related to the Company's life settlements business are reported as discontinued operations in the consolidated financial statements. The prior period operations related to this business have also been reported as discontinued operations retrospectively for all periods presented. The assets and liabilities related to the Company's life settlements business are reported as assets and liabilities of discontinued operations in the consolidated balance sheets as of August 31, 2013. The Company presented the prior year assets and liabilities related to the Company's life settlements business as discontinued operations to provide comparability between the periods presented.

Discontinued operations on the consolidated statement of operations for the year ended August 31, 2013 and 2012 are as follows:

	Year ended August 31, 2013			Year ended August 31, 2012
Sales, general and administrative expenses	$	(204,200	)	$	(2,175,602	)
Other income (expense)
Realized gain on life settlement contracts held under investment method		-			319,843
Realized loss on extinguishment of debt		(8,438,584	)		-
Change in fair value of life settlement contracts net of premiums paid		2,055,438			(36,460,974	)
Interest expense		(1,610,571	)		(626,710	)
Loss from discontinued operations before income tax		(8,197,917	)		(38,943,443	)
Income tax benefit		3,879,477			16,576,223
Net loss from discontinued operations	$	(4,318,440	)	$	(22,367,220	)

Assets and liabilities of discontinued operations for the Company's life settlements business on the consolidated balance sheets consist of the following:

	August 31, 2013		August 31, 2012
ASSETS
Current Assets
Cash and cash equivalents	$	-	$	228,165
Investment in life settlement contracts at investment method		-		4,334,012
Total current assets of discontinued operations		-		4,562,177
Investment in life settlement contracts at fair value		-		64,667,124
Deferred income taxes		145,781		-
Total noncurrent assets of discontinued operations	$	145,781	$	64,667,124
LIABILITIES
Current Liabilities
Interest payable	$	-	$	626,710
Loans payable		-		59,450,000
Income and other taxes payable		775,000		-
Total current liabilities of discontinued operations		775,000		60,076,710
Deferred income taxes		-		4,433,696
Total long-term liabilities of discontinued operations	$	-	$	4,433,696

During the year ended August 31, 2013, a life settlement contract matured resulting in cash proceeds of $10,000,000, these proceeds were used to satisfy the Company's outstanding obligations of $9,378,807 in discontinued operations, including (i) interest on Term Loan of $2,123,281, (ii) $5,971,000 outstanding under the Revolving Loan, plus $114,000 in interest under the Revolving Loan, or a total of $6,085,000 due under the Revolving Loan and (iii) $1,170,526 premiums payable on behalf of ALS Capital Ventures LLC.

As of August 31, 2013, the Company had a deferred income tax asset of $145,781 from an NOL from discontinued operations and income tax payable of $775,000, which includes $75,000 for interest and penalties, as a result of a realized gain from maturity of a life settlement contract which could not be offset by the capital loss generated by the disposition of life settlement contracts.

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NATURE AND CONTINUANCE OF OPERATIONS

12 Months Ended

Aug. 31, 2013

NATURE AND CONTINUANCE OF OPERATIONS [Abstract]

NATURE AND CONTINUANCE OF OPERATIONS

1. NATURE AND CONTINUANCE OF OPERATIONS

Infinity Augmented Reality, Inc. (formerly known as Absolute Life Solutions, Inc.) (the "Company") was originally incorporated as Shimmer Gold, Inc. in the State of Nevada on September 7, 2006. The Company was an Exploration Stage company as defined by Accounting Standards Codification ("ASC") 915, Development Stage Entities, and was in the business of the acquisition and exploration of mineral resources during the period from September 7, 2006 to May 21, 2010. Subsequently, a majority of our shareholders approved an amendment to our Articles of Incorporation changing our name to Absolute Life Solutions, Inc. During the fiscal year ended August 31, 2010, the Company commenced operations as a specialty financial services company engaged in the business of purchasing life settlement contracts for long-term investment purposes and was no longer classified as a development stage company.

Effective November 15, 2012, the Company is no longer engaged in its prior primary activity as a specialty financial services company primarily engaged in the purchase of life settlement contracts. As a result of the foregoing, the Company is currently classified as a development stage company. All of the operations related to the Company's life settlements business are reported as discontinued operations in the consolidated financial statements. As discussed in Note 3, the prior period operations related to this business have also been reclassified as discontinued operations retrospectively for all periods presented.

During the year ended August 31, 2012, the Company formed a wholly-owned subsidiary Infinity Augmented Reality, LLC ("IAR Subsidiary") and commenced activities to enable it to be actively engaged in the development of software applications which will utilize augmented reality. Effective March 7, 2013, the Company changed its name from Absolute Life Solutions, Inc. to Infinity Augmented Reality, Inc. On that same date, the IAR Subsidiary was merged into the Company. Effective June 30, 2013, the Company formed a wholly owned Israeli subsidiary, Infinity Augmented Reality Israel Ltd. ("Infinity Israel"). The Company is actively engaged in the development of software applications which will utilize augmented reality. The Company intends to develop a comprehensive augmented reality platform for consumers. The Company's objective is to establish itself firmly as a preeminent source for state-of-the-art augmented reality experiences, forging a strong association, early on, between the Infinity brand and the burgeoning medium.

The continued existence of the Company is dependent upon its ability to generate profit from its augmented reality business and to meet its obligations as they become due. If additional cash is needed, the Company intends to finance the future capital required for continued operations from a combination of traditional debt and equity markets. However, there is no assurance that (a) traditional debt and equity markets may be accessible as required, or if so, on acceptable terms and, or (b) the demand for and selling prices of the Company's augmented reality products, may not be sufficient to meet cash flow expectations. The outcome of these matters cannot be predicted with certainty and therefore the Company may not be able to continue or expand operations as planned. These conditions raise substantial doubt about the Company's ability to continue as a going concern. These audited financial statements do not include any adjustments to the amounts and classification of assets and liabilities that may be necessary should the Company be unable to continue as a going concern.

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RELATED PARTY TRANSACTIONS (Details) (USD $)			12 Months Ended	1 Months Ended
	Aug. 31, 2013	Aug. 31, 2012	Aug. 31, 2013 "Note" [Member]	May 22, 2013 "Note" [Member] Principal Shareholder [Member]
Related Party Transaction [Line Items]
Amount			$ 200,000	$ 200,000
Interest rate			8.00%
Maturity			May 31, 2013
Exchange of Note for a Convertible Debenture				202,543
Accrued interest	$ 3,906			$ 2,543

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CONVERTIBLE DEBENTURES (Fair Value Assumptions of Warrants) (Details) (Warrant [Member])	12 Months Ended
	Aug. 31, 2013
Issued on April 23, 2013 [Member]
Class of Warrant or Right [Line Items]
Contractual term (Years)	5 years
Volatility	71.00%
Dividend yield	0.00%
Risk-free interest rate	0.70%
Issued on May 17, 2013 [Member]
Class of Warrant or Right [Line Items]
Contractual term (Years)	5 years
Volatility	71.90%
Dividend yield	0.00%
Risk-free interest rate	0.79%
Issued on May 22, 2013 [Member]
Class of Warrant or Right [Line Items]
Contractual term (Years)	5 years
Volatility	71.70%
Dividend yield	0.00%
Risk-free interest rate	0.84%
Issued on May 29, 2013 [Member]
Class of Warrant or Right [Line Items]
Contractual term (Years)	5 years
Volatility	72.00%
Dividend yield	0.00%
Risk-free interest rate	1.02%
Issued on July 2, 2013 [Member]
Class of Warrant or Right [Line Items]
Contractual term (Years)	5 years
Volatility	72.00%
Dividend yield	0.00%
Risk-free interest rate	1.39%
Issued on July 29, 2013 [Member]
Class of Warrant or Right [Line Items]
Contractual term (Years)	5 years
Volatility	74.40%
Dividend yield	0.00%
Risk-free interest rate	1.36%
Issued on August 27, 2013 [Member]
Class of Warrant or Right [Line Items]
Contractual term (Years)	5 years
Volatility	74.60%
Dividend yield	0.00%
Risk-free interest rate	1.61%

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COMMON STOCK, WARRANTS AND OPTIONS (Schedule of Warrant Transactions) (Details) (Warrant [Member], USD $)	12 Months Ended
	Aug. 31, 2013	Aug. 31, 2012
Warrant [Member]
Number of warrants
Balance	6,000,000
Issued	7,710,172
Balance	13,710,172	6,000,000
Weighted average exercise price
Balance	$ 0.01
Issued	$ 0.50
Balance	$ 0.28	$ 0.01
Weighted average life remaining (in years)
Balance	3 years 6 months 4 days	1 year 9 months 15 days
Issued	4 years 10 months 6 days

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INCOME TAXES (Schedule of Income Tax Expense (Benefit)) (Details) (USD $)	12 Months Ended
	Aug. 31, 2013	Aug. 31, 2012
INCOME TAXES [Abstract]
Current tax expense
Deferred tax expense (benefit)	190,652	(64,689)
Total income tax expense (benefit)	$ 190,652	$ (64,689)

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CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $)	12 Months Ended
	Aug. 31, 2013	Aug. 31, 2012
Preferred stock, par value (in dollars per share)	$ 0.00001	$ 0.00001
Preferred stock, shares authorized	100,000,000	100,000,000
Common stock, par value (in dollars per share)	$ 0.00001	$ 0.00001
Common stock, shares authorized	500,000,000	500,000,000
Common stock, shares issued	93,584,759	92,544,747
Common stock, shares outstanding	93,229,291	92,229,599
Treasury stock	355,468	315,148
Series A Convertible Preferred Stock [Member]
Preferred stock, shares designated	60,000	60,000
Preferred stock, dividend rate, percentage	12.50%	0.00%
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Series B Convertible Preferred Stock [Member]
Preferred stock, shares designated	25,000	25,000
Preferred stock, dividend rate, percentage	12.50%	0.00%
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0

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PREFERRED STOCK

12 Months Ended

Aug. 31, 2013

PREFERRED STOCK [Abstract]

PREFERRED STOCK

6. PREFERRED STOCK

The total number of preferred shares authorized and that may be issued by the Company is 100,000,000 preferred shares with a par value of $0.00001. These preferred shares have no rights to voting, profit sharing or liquidation. As of August 31, 2013, there are no outstanding Series A Preferred Stock or Series B Preferred Stock.

On July 25, 2012, the Company paid dividends due December 31, 2011with the issuance of 3,201,093 shares of common stock valued at $3,233,104.

On July 25, 2012, the Company paid dividends due June 30, 2012 with the issuance of 3,315,754 shares of common stock valued at $1,160,514.

On July 31, 2012, the Company paid dividends due July 31, 2012 with the issuance of 603,303 shares of common stock valued at $187,024.

During the year ended August 31, 2012, the issuance of the Series A and Series B Preferred Stock with a contractual conversion price of $1.00 resulted in an effective conversion price lower than the fair market value of the Company's Common Stock at each issuance after allocating the proceeds received to the preferred shares and the detachable warrants included with the preferred shares. Accordingly, pursuant to GAAP, the Company recorded deemed dividends in the aggregate amount of $932,643 attributable to the beneficial conversion feature in connection with the private placement of the 2,500 Series A preferred shares issued in the quarter ending February 29, 2012.

On July 31, 2012, the Company entered into an agreement (the "Preferred Shares Agreement") with the Lenders, as holders of the Company's preferred stock, for the Company's purchase from the Lenders of an aggregate of 48,300 shares of the Series A and 8,850 shares of Series B Preferred Stock, which represent all of the issued and outstanding shares of preferred stock and which have an aggregate stated value of $57,150,000, for a purchase price of $57,150,000. (The payment will be made by the Company applying all of the proceeds of the Term Loan for such purpose.) As part of the purchase, the Lenders, who also held warrants to purchase 57,592,500 shares of the Company's stock at exercise prices from $2 and $4 a share, agreed to cancel those warrants.

The Series A Preferred Stock and Series B Preferred Stock held by the Lenders included provisions allowing for the conversion of the preferred shares into shares of Common Stock of the Company. After the purchase of the Series A Preferred Stock and Series B Preferred Stock held by the Lenders, there are no shares of Preferred Stock currently outstanding and all of the warrants held by the Lenders have been canceled.

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CONSOLIDATED STATEMENTS OF OPERATIONS (Parenthetical) (USD $)	12 Months Ended
	Aug. 31, 2013
CONSOLIDATED STATEMENTS OF OPERATIONS [Abstract]
Loss on disposal of life settlement contracts	$ 8,438,584

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CONSOLIDATED BALANCE SHEETS (USD $)	Aug. 31, 2013	Aug. 31, 2012
ASSETS
Cash and cash equivalents	$ 431,760	$ 4,885
Convertible note receivable	50,000
Prepaid expenses	21,355	15,192
Current assets of discontinued operations		4,562,177
Total current assets	503,115	4,582,254
Leasehold improvements and equipment, net	126,108	66,129
Security deposit	86,272	56,688
Deferred taxes		190,652
Noncurrent assets of discontinued operations	145,781	64,667,124
TOTAL ASSETS	861,276	69,562,847
LIABILITIES
Accounts payable and accrued expenses	371,598	441,297
Interest payable	3,906
Current liabilities of discontinued operations	775,000	60,076,710
Total current liabilities	1,150,504	60,518,007
Deferred rent		49,335
Convertible debentures, net of debt discount	128,327
Long-term liabilities of discontinued operations		4,433,696
TOTAL LIABILITIES	1,278,831	65,001,038
Contingencies
STOCKHOLDERS' (DEFICIT) EQUITY
Common stock ($0.00001 par value; 500,000,000 authorized; 93,584,759 issued and 93,229,291 outstanding) ( August 31, 2012 - 92,544,747 issued and 92,229,599 outstanding)	936	925
Additional paid in capital	57,938,675	51,486,890
Treasury stock, at cost (355,468 shares of common stock) (August 31, 2012 - 315,148 shares of common stock)	(49,766)	(44,121)
Accumulated deficit	(58,305,978)	(46,881,885)
Accumulated other comprehensive loss	(1,422)
Total Stockholders' (Deficit) Equity	(417,555)	4,561,809
TOTAL LIABILITIES AND STOCKHOLDERS' (DEFICIT) EQUITY	861,276	69,562,847
Series A Convertible Preferred Stock [Member]
STOCKHOLDERS' (DEFICIT) EQUITY
Preferred stock,value
Series B Convertible Preferred Stock [Member]
STOCKHOLDERS' (DEFICIT) EQUITY
Preferred stock,value

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CONVERTIBLE DEBENTURES (Schedule for Senior Convertible Notes) (Details) (USD $)	Aug. 31, 2013	Aug. 31, 2012
Debt Instrument [Line Items]
Balance	$ 128,327
Senior convertible notes [Member]
Debt Instrument [Line Items]
Amount	1,927,543
Interest rate	1.20%
Senior convertible notes [Member] | Issued on April 23, 2013 [Member]
Debt Instrument [Line Items]
Amount	200,000
Interest rate	1.20%
Debt discount/ beneficial conversion feature	185,761
Balance	14,239
Accrued interest payable	855
Senior convertible notes [Member] | Issued on May 17, 2013 [Member]
Debt Instrument [Line Items]
Amount	200,000
Interest rate	1.20%
Debt discount/ beneficial conversion feature	139,066
Balance	60,934
Accrued interest payable	697
Senior convertible notes [Member] | Issued on May 22, 2013 [Member]
Debt Instrument [Line Items]
Amount	202,543
Interest rate	1.20%
Debt discount/ beneficial conversion feature	177,410
Balance	25,133
Accrued interest payable	673
Senior convertible notes [Member] | Issued on May 29, 2013 [Member]
Debt Instrument [Line Items]
Amount	225,000
Interest rate	1.20%
Debt discount/ beneficial conversion feature	213,417
Balance	11,583
Accrued interest payable	695
Senior convertible notes [Member] | Issued on July 2, 2013 [Member]
Debt Instrument [Line Items]
Amount	250,000
Interest rate	1.20%
Debt discount/ beneficial conversion feature	241,781
Balance	8,219
Accrued interest payable	493
Senior convertible notes [Member] | Issued on July 29, 2013 [Member]
Debt Instrument [Line Items]
Amount	400,000
Interest rate	1.20%
Debt discount/ beneficial conversion feature	392,767
Balance	7,233
Accrued interest payable	434
Senior convertible notes [Member] | Issued on August 27, 2013 [Member]
Debt Instrument [Line Items]
Amount	450,000
Interest rate	1.20%
Debt discount/ beneficial conversion feature	449,014
Balance	986
Accrued interest payable	$ 59

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INCOME TAXES (Tables)

12 Months Ended

Aug. 31, 2013

INCOME TAXES [Abstract]

Schedule of Income Tax Expense (Benefit)

Income tax expense consists of the following components at August 31, 2013 and 2012:

	2013		2012
Current tax expense	$	-	$	-
Deferred tax expense (benefit)		190,652		(64,689	)
Total income tax expense (benefit)	$	190,652	$	(64,689	)

Schedule of Effective Income Tax Rate Reconciliation

Income tax expense differed from amounts computed by applying the Federal income tax rate to pre-tax earnings for the years ended August 31, 2013 and 2012, as a result of the following:

	2013			2012
United States statutory rate		(35	)%		(35	)%
State income taxes		(10	)%		(10	)%
Foreign earnings taxed at different rates		1	%
Increase in valuation allowance and other		41	%
Combined effective tax rate		(3	)%		(45	)%

Schedule of Deferred Tax Assets and Liabilities

The tax effects of temporary differences that gave rise to significant portions of the deferred tax assets and deferred tax liabilities were as follows:

	August 31,  2013			August 31,  2012
Deferred tax assets:
Equipment	$	6,648		$	6,648
Deferred rent		-			22,201
Stock issuances to officers, directors and consultant		2,134,062			103,950
Start-up expenses		993,636			64,689
Fair value of beneficial conversion feature and warrants		27,548			-
Net operating loss carryforward		438,254			438,254
Net operating loss carryforward - Israel		84,531			-
Gross deferred tax assets		3,684,679			635,742
Valuation allowance		(3,675,438	)		(438,254	)
Net deferred tax assets		9,241			197,488
Deferred tax liabilities:
Prepaid insurance		(9,241	)		(6,836	)
Gross deferred tax liabilities		(9,241	)		(6,836	)
Valuation allowance		-			-
Net deferred tax liabilities		(9,241	)		(6,836	)
Total deferred tax assets, net	$	-		$	190,652
Summary of net deferred tax assets:
Current	$	-		$	-
Non-current		-			190,652
Total deferred tax assets, net	$	-		$	190,652

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INCOME TAXES (Schedule of Deferred Tax Assets and Liabilities) (Details) (USD $)	Aug. 31, 2013	Aug. 31, 2012
Deferred tax assets:
Equipment	$ 6,648	$ 6,648
Deferred rent		22,201
Stock issuances to officers, directors and consultant	2,134,062	103,950
Start-up expenses	993,636	64,689
Fair value of beneficial conversion feature and warrants	27,548
Net operating loss carryforward	438,254	438,254
Net operating loss carryforward - Israel	84,531
Gross deferred tax assets	3,684,679	635,742
Valuation allowance	(3,675,438)	(438,254)
Net deferred tax assets	9,241	197,488
Deferred tax liabilities:
Prepaid insurance	(9,241)	(6,836)
Gross deferred tax liabilities	(9,241)	(6,836)
Valuation allowance
Net deferred tax liabilities	(9,241)	(6,836)
Total deferred tax assets, net		190,652
Summary of net deferred tax assets:
Current
Non-current		190,652
Total deferred tax assets, net		$ (190,652)

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COMMON STOCK, WARRANTS AND OPTIONS (Schedule of Stock Option Activity) (Details) (Stock Options [Member], USD $)	12 Months Ended
	Aug. 31, 2013	Aug. 31, 2012
Stock Options [Member]
Number of Shares
Outstanding at August 31, 2012
Options granted	23,830,000
Options exercised	(800,000)
Options forfeited
Options cancelled	(600,000)
Outstanding at August 31, 2013	22,430,000
Options vested and expected to vest	22,430,000
Options vested and exercisable	21,980,000
Weighted Average Exercise Price
Outstanding at August 31, 2012
Options granted	$ 0.11
Options exercised
Options forfeited
Options cancelled
Outstanding at August 31, 2013	$ 0.11
Options vested and expected to vest	$ 0.11
Options vested and exercisable	$ 0.10
Total Weighted Average Intrinsic Value
Outstanding at August 31, 2012
Options granted
Options exercised
Options forfeited
Options cancelled
Outstanding at August 31, 2013	$ 0.19
Options vested and expected to vest	$ 0.19
Options vested and exercisable	$ 0.20
Weighted Average Remaining Contactual Life (in years)
Outstanding	4 years 6 months 4 days
Options granted
Options exercised
Options forfeited
Options cancelled
Options vested and expected to vest	4 years 6 months 4 days
Options vested and exercisable	4 years 6 months 7 days

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COMMON STOCK, WARRANTS AND OPTIONS (Narrative) (Details) (USD $)	12 Months Ended
	Aug. 31, 2013	Aug. 31, 2012
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock issued for services, value	$ 69,604
Treasury stock	355,468	315,148
Warrants outstanding and exercisable	13,710,172
Stock options compensation expense	4,441,758
Unamortized stock compensation expense	24,676
2013 Plan [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Equity Incentive Plan, shares of common stock reserved for issuance	30,000,000
2013 and 2010 Plans [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Equity Incentive Plan, shares of common stock reserved for issuance	40,000,000
Stock options outstanding	24,570,012
CFO [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock returned to treasury, shares	40,320
Taxes paid	5,645
Officer [Member] | 2010 Plan [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Options granted	230,000
Options granted, exercise price	$ 0.25
Stock option, vesting date	Mar. 06, 2013
Stock option, expiration date	Mar. 07, 2018
Helen Papagiannis [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Annual base compensation	200,000
Helen Papagiannis [Member] | 2010 Plan [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Options granted	500,000
Options granted, exercise price	$ 0.25
Stock option, vesting date	Mar. 06, 2013
Stock option, expiration date	Mar. 07, 2018
Option vesting terms	100,000 of such Options vest on March 6, 2013 and expire on March 7, 2018. 400,000 of such Options vest quarterly over the next 2 years (in equal amounts of 50,000 Options at the beginning of the Company's quarterly reporting periods, i.e. December 1, March 1, June 1 and September 1), and expire on March 7, 2018.
Enon Landenberg [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Annual base compensation	250,000
Former CEO [Member] | 2013 Plan [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Options granted	300,000
Options granted, exercise price	$ 0.405
Stock option, vesting date	Dec. 01, 2013
Stock option, expiration date	May 29, 2018
Director [Member] | 2010 Plan [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Options granted	100,000
Options granted, exercise price	$ 0.31
Stock option, vesting date	Oct. 24, 2013
Stock option, expiration date	Oct. 23, 2017
Minimum [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Warrant expiration date	Jun. 01, 2015
Maximum [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Warrant expiration date	Aug. 31, 2018
Consultants [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock issued for services, shares	240,012
Stock issued for services, value	$ 69,604
Consultants [Member] | 2013 Plan [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Options granted	14,550,000
Consultants [Member] | 2013 and 2010 Plans [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Options granted	22,600,000
Options granted, exercise price	$ 0.10
Stock option, vesting date	Mar. 04, 2013
Stock option, expiration date	Mar. 05, 2018
Options exercised	800,000
Options forfeited and cancelled	300,000
Consultants [Member] | 2010 Plan [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Options granted	8,050,000

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CONVERTIBLE DEBENTURES

12 Months Ended

Aug. 31, 2013

CONVERTIBLE DEBENTURES [Abstract]

CONVERTIBLE DEBENTURES

5. CONVERTIBLE DEBENTURES

During the year ended August 31, 2013, the Company completed a private placement of (i) five-year Convertible Debentures (the "Debentures") for an aggregate principal amount of $1,927,543,bearing interest at 1.2% per annum, convertible into shares (the "Conversion Shares") of common stock, at a conversion price of $0.25, and (ii) a five-year Warrant (the "Warrants") to purchase 7,710,172 shares of common stock (the "Warrant Shares"), to certain accredited investors (the "Purchasers") pursuant to Securities Purchase Agreements dated April 23, May 17, May 22, May 29, July 2, July 29 and August 27, 2013.

The Debentures bear interest at 1.2% per annum payable semi-annually in arrears in either cash or common stock (at the discretion of the Company). There are no provisions for early redemption by the Company.

 The Purchasers were issued Warrants to purchase the Company's common stock, exercisable for a period of five years at an initial exercise price of $0.50, subject to adjustment. The Warrants provide for customary adjustments to the exercise price in the event of stock splits, stock dividends and other similar corporate events and may be exercised on a cashless basis. The Warrants do not confer any voting rights or any other rights as a shareholder.

The Company accounts for the beneficial conversion feature ("BCF") and warrant valuation in accordance with ASC 470-20, Debt with Conversion and Other Options. The Company records a BCF related to the issuance of convertible debt that has conversion features at fixed rates that are "in-the-money" when issued and the fair value of warrants issued in connection with those instruments. The BCF for the convertible instruments is recognized and measured by allocating a portion of the proceeds to warrants, based on their relative fair value, and as a reduction to the carrying amount of the convertible debt equal to the intrinsic value of the conversion feature. The discount recorded in connection with the BCF and warrant valuation is recognized as non-cash interest expense and is amortized over the terms of the convertible notes. The Company recorded an aggregate of $1,860,434 for the calculated fair value of the warrants and BCF, in conjunction with the convertible notes issued on April 23, May 17, May 22 and May 29, July 2, July 29 and August 27, 2013.

The Company valued the warrants at the date the warrants were issued, using the Black-Scholes valuation model and the following assumptions:

	April 23, 2013			May 17, 2013			May 22, 2013			May 29, 2013
Contractual term (Years)		5.0			5.0			5.0			5.0
Volatility		71.0	%		71.9	%		71.7	%		72.0	%
Dividend yield		0.0	%		0.0	%		0.0	%		0.0	%
Risk-free interest rate		0.70	%		0.79	%		0.84	%		1.02	%
	July 2, 2013			July 29, 2013			August 27, 2013
Contractual term (Years)		5.0			5.0			5.0
Volatility		72.0	%		74.4	%		74.6	%
Dividend yield		0.0	%		0.0	%		0.0	%
Risk-free interest rate		1.39	%		1.36	%		1.61	%

Senior convertible notes consist of the following at August 31, 2013:

1.2% convertible debentures (issued April 23, 2013)	$	200,000
Debt discount/ beneficial conversion feature		185,761
Balance		14,239
Accrued interest payable	$	855
1.2% convertible debentures (issued May 17, 2013)	$	200,000
Debt discount/ beneficial conversion feature		139,066
Balance		60,934
Accrued interest payable	$	697
1.2% convertible debentures (issued May 22, 2013)	$	202,543
Debt discount/ beneficial conversion feature		177,410
Balance		25,133
Accrued interest payable	$	673
1.2% convertible debentures (issued May 29, 2013)	$	225,000
Debt discount/ beneficial conversion feature		213,417
Balance		11,583
Accrued interest payable	$	695
1.2% convertible debentures (issued July 2, 2013)	$	250,000
Debt discount/ beneficial conversion feature		241,781
Balance		8,219
Accrued interest payable	$	493
1.2% convertible debentures (issued July 29, 2013)	$	400,000
Debt discount/ beneficial conversion feature		392,767
Balance		7,233
Accrued interest payable	$	434
1.2% convertible debentures (issued August 27, 2013)	$	450,000
Debt discount/ beneficial conversion feature		449,014
Balance		986
Accrued interest payable	$	59

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CONVERTIBLE DEBENTURES (Narrative) (Details) (USD $)			12 Months Ended
	Aug. 31, 2013	Jul. 31, 2012	Aug. 31, 2013 Convertible Debentures [Member]
Debt Instrument [Line Items]
Term			5 years
Amount			$ 1,927,543
Interest rate			1.20%
Conversion price			$ 0.25
Warrant Term			5 years
Warrants issued to purchase shares of common stock		57,592,500	7,710,172
Exercise price of warrants	$ 0.01		$ 0.50
Aggregate fair value of warrants and beneficial conversion feature			$ 1,860,434

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SUBSEQUENT EVENTS (Details)	0 Months Ended							9 Months Ended	12 Months Ended		0 Months Ended
	Dec. 19, 2013 USD ($)	Dec. 05, 2013 USD ($)	Nov. 27, 2013 USD ($)	Nov. 27, 2013 ILS	Nov. 07, 2013 USD ($)	Oct. 09, 2013 USD ($)	Sep. 17, 2013 USD ($)	Aug. 31, 2013 USD ($)	Aug. 31, 2013 USD ($)	Aug. 31, 2012 USD ($)	Sep. 11, 2013 Ori Inbar [Member] USD ($)	Nov. 01, 2013 Ortal Zanzuri [Member] USD ($)	Nov. 18, 2013 Consultant [Member] USD ($)
Subsequent Event [Line Items]
Monthly retainer fee											$ 2,000
Annual base compensation												200,000
Options granted											100,000	200,000
Options granted, exercise price											$ 0.29
Option vesting terms											The options vest semiannually over the next 2 years (at the beginning of the Company's quarterly reporting date, i.e. March 1 and September 1), and expire 5 years from each vesting date. 25,000 (or 25%) Options shall initially vest on March 1, 2014 and expire on February 28, 2019.
Stock option, vesting date											Mar. 01, 2014
Stock option, expiration date											Feb. 28, 2019
Proceeds from convertible debentures	350,000	325,000			325,000	325,000	350,000	1,725,000	1,725,000
Options exercised													399,260
Options exercised, exercise price													$ 0.10
Proceeds from exercise of stock options								80,000	80,000				39,926
Compensation amount sought			$ 57,000	202,000

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INCOME TAXES

12 Months Ended

Aug. 31, 2013

INCOME TAXES [Abstract]

INCOME TAXES

8. INCOME TAXES

Income tax expense consists of the following components at August 31, 2013 and 2012:

	2013		2012
Current tax expense	$	-	$	-
Deferred tax expense (benefit)		190,652		(64,689	)
Total income tax expense (benefit)	$	190,652	$	(64,689	)

Income tax expense differed from amounts computed by applying the Federal income tax rate to pre-tax earnings for the years ended August 31, 2013 and 2012, as a result of the following:

	2013			2012
United States statutory rate		(35	)%		(35	)%
State income taxes		(10	)%		(10	)%
Foreign earnings taxed at different rates		1	%
Increase in valuation allowance and other		41	%
Combined effective tax rate		(3	)%		(45	)%

The tax effects of temporary differences that gave rise to significant portions of the deferred tax assets and deferred tax liabilities were as follows:

	August 31,  2013			August 31,  2012
Deferred tax assets:
Equipment	$	6,648		$	6,648
Deferred rent		-			22,201
Stock issuances to officers, directors and consultant		2,134,062			103,950
Start-up expenses		993,636			64,689
Fair value of beneficial conversion feature and warrants		27,548			-
Net operating loss carryforward		438,254			438,254
Net operating loss carryforward - Israel		84,531			-
Gross deferred tax assets		3,684,679			635,742
Valuation allowance		(3,675,438	)		(438,254	)
Net deferred tax assets		9,241			197,488
Deferred tax liabilities:
Prepaid insurance		(9,241	)		(6,836	)
Gross deferred tax liabilities		(9,241	)		(6,836	)
Valuation allowance		-			-
Net deferred tax liabilities		(9,241	)		(6,836	)
Total deferred tax assets, net	$	-		$	190,652
Summary of net deferred tax assets:
Current	$	-		$	-
Non-current		-			190,652
Total deferred tax assets, net	$	-		$	190,652

Accounting for Uncertainty in Income Taxes. In June 2006, the FASB issued guidance contained in ASC 740, Income Taxes  (formerly FIN 48). The guidance is intended to clarify the accounting for uncertainty in income taxes recognized in a company's financial statements and prescribes the recognition and measurement of a tax position taken or expected to be taken in a tax return.  ASC 740 also provides guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosure and transition.

Under ASC 740, evaluation of a tax position is a two-step process.  The first step is to determine whether it is more likely than not that a tax position will be sustained upon examination, including the resolution of any related appeals or litigation based on the technical merits of that position.  The second step is to measure a tax position that meets the more-likely-than-not threshold to determine the amount of benefit to be recognized in the financial statements.  A tax position is measured at the largest amount of benefit that is greater than 50% likely of being realized upon ultimate settlement.

As of August 31, 2013 and 2012, the Company had approximately $1,974,000 and $1,298,000 of federal, state, local and Israel net operating losses ("NOL"), respectively. The federal NOL carryforward expires in the fiscal year ending August 31, 2032. As of August 31, 2013 and 2012 the Company had approximately $340,000 and -0-, respectively of NOLs in Israel which is available to be carried forward indefinitely. The Company recorded a valuation allowance of approximately $523,000 against its deferred tax asset resulting from its NOL since management concluded that it was more likely than not that the Company would not realize the benefit of this portion of its deferred tax assets by generating sufficient taxable income in future years. In addition, approximately $3,150,000 of non-deductible capital losses were generated from discontinued operations. This capital loss is available to offset future capital gains and expires in the fiscal year ending August 31, 2018. The Company recorded a full valuation allowance of approximately $1,420,000 against the deferred tax asset resulting from the capital loss forward, since management concluded that it is more likely than not that Company will not realize the benefit by generating sufficient capital gains in future years.

As of August 31, 2013, the Company has filed income tax returns through the fiscal 2012 tax year. For fiscal year 2013, the Company is required to file income tax returns in the United States (federal), New York State and City, and Israel. Based on the Company's evaluation, it has been concluded that there are no significant uncertain tax positions requiring recognition in the Company's financial statements. The evaluation was performed for the August 31, 2007 - August 31, 2012 tax years, which remain subject to examination. At this time, the fiscal year 2011 tax return has been selected for examination by the Internal Revenue Service. The Company believes that its income tax positions and deductions would be sustained on audit and does not anticipate any adjustments that would result in material changes to its financial position.

The Company's policy for recording interest and penalties associated with audits is to record such expense as a component of general and administrative expense. There are no significant amounts accrued for penalties or interest as of or during the years ended August 31, 2013 and 2012. Management is currently unaware of any issues under review that could result in significant payments, accruals or material deviations from its position.

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CONVERTIBLE NOTE RECEIVABLE

12 Months Ended

Aug. 31, 2013

CONVERTIBLE NOTE RECEIVABLE [Abstract]

CONVERTIBLE NOTE RECEIVABLE

4. CONVERTIBLE NOTE RECEIVABLE

On July 10, 2013, the Company was issued a $50,000 par value Convertible Promissory Note from Meta Company, a Delaware company. The Note bears a 5% annual coupon and matures on July 31, 2014. The Note is convertible into common shares of Meta Company at conversion price of 80% of the price of common equity sold in a Qualified Offering of at least $1,000,000. The note is carried at cost which approximates fair value.

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CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY (DEFICIT) (USD $)	Total	Series A Convertible Preferred Stock [Member]	Series B Convertible Preferred Stock [Member]	Common Stock [Member]	Additional Paid-In Capital [Member]	Treasury Stock [Member]	Retained Earnings (Accumulated Deficit) [Member]	Accumulated Other Comprehensive Loss [Member]
Balance at Aug. 31, 2011	$ 77,852,214			$ 854	$ 96,773,677		$ (18,922,317)
Balance, shares at Aug. 31, 2011		41,950	8,850	85,424,597
Preferred stock and warrants issued for cash at $1,000 per share	6,350,000				6,350,000
Preferred stock and warrants issued for cash at $1,000 per share, shares		6,350
Stock dividends paid on preferred stock				71	4,580,570		(4,580,641)
Stock dividends paid on preferred stock, Shares				7,120,150
Deemed dividends on preferred stock					932,643		(932,643)
Repurchase of preferred stock	(57,150,000)				(57,150,000)
Repurchase of preferred stock, shares		(48,300)	(8,850)
Purchase of treasury stock	(44,121)					(44,121)
Purchase of treasury stock, shares				(315,148)
Foreign currency translation adjustments
Net loss	(22,446,284)						(22,446,284)
Balance at Aug. 31, 2012	4,561,809			925	51,486,890	(44,121)	(46,881,885)
Balance, shares at Aug. 31, 2012				92,229,599
Common stock issued for consulting services at $0.29 per share in May 2013	69,604			3	69,601
Common stock issued for consulting services at $0.29 per share in May 2013, shares				240,012
Exercise of stock options by consultants	80,000			8	79,992
Exercise of stock options by consultants, shares				800,000
Fair value of stock options granted to officer, directors and consultants	4,441,758				4,441,758
Fair value of warrants issued with convertible debentures	818,712				818,712
Beneficial conversion feature of convertible debentures	1,041,722				1,041,722
Purchase of treasury stock	(5,645)					(5,645)
Purchase of treasury stock, shares				(40,320)
Foreign currency translation adjustments	(1,422)							(1,422)
Net loss	(11,424,093)						(11,424,093)
Balance at Aug. 31, 2013	$ (417,555)			$ 936	$ 57,938,675	$ (49,766)	$ (58,305,978)	$ (1,422)
Balance, shares at Aug. 31, 2013				93,229,291

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COMMON STOCK, WARRANTS AND OPTIONS (Fair Value Assumptions for Options) (Details) (Stock Options [Member], USD $)	12 Months Ended
	Aug. 31, 2013
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected stock price volatility, minimum	71.50%
Expected stock price volatility, maximum	72.00%
Risk-free rate of interest, minimum	0.76%
Risk-free rate of interest, maximum	1.01%
Aggregate fair value of the options at grant date	$ 4,466,434
Maximum [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Exercise price	$ 0.100
Expected life of options	4 years 1 month 24 days
Minimum [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Exercise price	$ 0.405
Expected life of options	4 years 9 months

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SIGNIFICANT ACCOUNTING POLICIES (Policies)

12 Months Ended

Aug. 31, 2013

SIGNIFICANT ACCOUNTING POLICIES [Abstract]

Basis of Presentation

Basis of Presentation

The consolidated financial statements of the Company as of August 31, 2013 and 2012 and for the years then ended have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP"). The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiary. All significant intercompany accounts and transactions are eliminated in the consolidation process.

Use of Estimates

Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The Company regularly evaluates estimates and assumptions. The Company bases its estimates and assumptions on current facts, historical experience and various other factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources. The actual results experienced by the Company may differ materially and adversely from the Company's estimates. To the extent there are material differences between the estimates and the actual results, future results of operations will be affected. The most significant estimates with regard to these financial statements relate to the value of warrants and options and deferred income tax amounts and rates and timing of the reversal of income tax differences.

Development Stage Company

Development Stage Company

Effective November 15, 2012, the Company is considered a development stage company, having no operating revenues during the period from November 15, 2012 ("Inception") to August 31, 2013, as defined by ASC 915-205, Development-Stage Entities. ASC 915-205 requires companies to report their operations, shareholders equity and cash flows upon entering the development stage through the date that revenues are generated. From November 15, 2012 through August 31, 2013, all operating expenses of the Company related to its augmented reality business and is included in the Consolidated Statements of Operations. The Company had operating expenses of $179,279 and $143,753 respectively for the period from September 1, 2012 to November 15, 2012 and the period from June 1, 2012 to August 31, 2012 respectively, relating to its augmented reality business.

Cash and Cash Equivalents

Cash and Cash Equivalents

The Company considers all short term investments with an original maturity of three months or less to be cash equivalents. The Company maintains cash balances that may be uninsured or in deposit accounts that exceed Federal Deposit Insurance Corporation limits. The Company maintains its cash deposits with major financial institutions.

Reclassifications

Reclassifications

During the year ended August 31, 2013, the Company disposed of all its life settlement contracts. As of August 31, 2013, all of the operations related to the life settlement business, as well as any resulting gain or loss recognized from the disposal, have been reported as discontinued operations in the consolidated financial statements. The Company has also reported the prior period operations related to this business as discontinued operations retrospectively for all periods presented. Additionally, the assets and liabilities related to the life settlements business have been classified as discontinued operations in the consolidated balance sheets for all periods presented. See Note 3 - Discontinued Operations  for more information.

Financial Instruments

Financial Instruments

The fair value of certain of the Company's financial instruments, consisting of cash, accounts payable and accrued expenses are estimated to be equal to their carrying value due to the short-term nature of these instruments. It is management's opinion that the Company is not exposed to significant interest, currency and credit risks arising from these financial instruments.

Leasehold Improvements and Equipment

Leasehold Improvements and Equipment

Equipment consists of computer hardware and furniture and is recorded at cost. Computer hardware and furniture are depreciated on a straight-line basis over their estimated lives of five years. Leasehold improvements are amortized on a straight-line basis over the lease life of two years.

Deferred Rent

Deferred Rent

The Company's prior operating lease provided for minimum annual payments that adjusted over the life of the lease. The aggregate minimum annual payments were expensed on the straight-line basis over the minimum lease term. The Company recognized a deferred rent liability for rent escalations when the amount of straight-line rent exceeded the lease payments, and reduced the deferred rent liability when the lease payments exceed the straight-line rent expense. As of August 31, 2013, the Company has no deferred rent liability.

Software Development Costs

Software Development Costs

The Company applies the principles of ASC 985-20, Software- Costs of Software to Be Sold, Leased, or Marketed, which requires that software development costs incurred in conjunction with product development be charged to research and development expense until technological feasibility is established. Thereafter, until the product is released for sale, software development costs must be capitalized and reported at the lower of unamortized cost or net realizable value of the related product. The Company has adopted the "tested working model" approach to establishing technological feasibility for its products. Under this approach, a product in development is not considered to have passed the technological feasibility milestone until the Company has produced a model of the product that contains essentially all the functionality and features of the final product and have tested the model to ensure that it works as expected. The Company has expensed all software development costs when incurred since none of the Company's products have reached technological feasibility.

Foreign Currency Translation

Foreign Currency Translation

The financial statements are presented in United States dollars. In accordance with ASC 830, Foreign Currency Matters, foreign denominated monetary assets and liabilities are translated to their United States dollar equivalents using foreign exchange rates which prevailed at the balance sheet date. Non-monetary assets and liabilities are translated at exchange rates prevailing at the transaction date. Revenue and expenses are translated at average rates of exchange during the periods presented. Related translation adjustments are reported as a separate component of stockholders' equity (deficit), whereas gains or losses resulting from foreign currency remeasurement and transactions are included in results of operations.

Income Taxes

Income Taxes

Deferred income taxes are provided for tax effects of temporary differences between the tax basis of asset and liabilities and their reported amounts in the financial statements. The Company uses the liability method to account for income taxes, which requires deferred taxes to be recorded at the statutory rate expected to be in effect when the taxes are paid. Valuation allowances are provided for a deferred tax asset when it is more likely than not that such asset will not be realized.

Management evaluates tax positions taken or expected to be taken in a tax return. The evaluation of a tax position includes a determination of whether a tax position should be recognized in the financial statements, and such a position should only be recognized if the Company determines that it is more likely than not that the tax position will be sustained upon examination by the tax authorities, based upon the technical merits of the position. For those tax positions that should be recognized, the measurement of a tax position is determined as being the largest amount of benefit that is greater than fifty percent likely of being realized upon ultimate settlement.

The Company's policy for recording interest and penalties associated with audits is to record such expense as a component of income tax expense.

Loss per Share

Loss per Share

Basic loss per share is calculated using the weighted average number of shares of common stock outstanding during the period. Included in basic loss per share calculations are the effects of 6,000,000 warrants exercisable at $0.01. Diluted earnings per share reflect the potential dilution that could occur if potentially dilutive securities were exercised or converted to common stock. The dilutive effect of options and warrants and their equivalent is computed by application of the treasury stock method and the effect of convertible securities by the "if converted" method. For the year ended August 31, 2013, 30,450,344 shares of common stock, comprised of 7,710,172 convertible debentures with a conversion price of $0.25, 7,710,172 warrants with an exercise price of $0.50, and stock options exercisable into 22,430,000 common shares are not included in diluted earnings per share since their effect would be anti-dilutive. For the year ended August 31, 2012, 27,700,000 and 28,142,500 warrants with an exercise price of $2.00 and $4.00 respectively, and 55,400 Series A and Series B preferred shares, convertible into 55,400,000 common shares are not included in diluted earnings per share since their effect would be anti-dilutive.

Stock-Based Compensation

Stock-Based Compensation

The Company records stock-based compensation expense in accordance with  ASC 718, Compensation - Stock Compensation. The Company expenses stock-based compensation to employees over the requisite service period based on the estimated grant-date fair value of the awards and forfeiture rates. For stock-based compensation awards to non-employees, the Company re-measures the fair value of the non-employee awards at each reporting period prior to vesting and finally at the vesting date of the award. The assumptions used in calculating the fair value of stock-based awards represent management's best estimates and involve inherent uncertainties and the application of management's judgment.

Recent Accounting Pronouncements

Recent Accounting Pronouncements

In March 2013, the FASB issued ASU 2013-07, "Presentation of Financial Statements (Topic 205): Liquidation Basis of Accounting." The amendments require an entity to prepare its financial statements using the liquidation basis of accounting when liquidation is imminent. Liquidation is imminent when the likelihood is remote that the entity will return from liquidation and either (a) a plan for liquidation is approved by the person or persons with the authority to make such a plan effective and the likelihood is remote that the execution of the plan will be blocked by other parties or (b) a plan for liquidation is being imposed by other forces (for example, involuntary bankruptcy). If a plan for liquidation was specified in the entity's governing documents from the entity's inception (for example, limited-life entities), the entity should apply the liquidation basis of accounting only if the approved plan for liquidation differs from the plan for liquidation that was specified at the entity's inception. The amendments require financial statements prepared using the liquidation basis of accounting to present relevant information about an entity's expected resources in liquidation by measuring and presenting assets at the amount of the expected cash proceeds from liquidation. The entity should include in its presentation of assets any items it had not previously recognized under U.S. GAAP but that it expects to either sell in liquidation or use in settling liabilities (for example, trademarks). The amendments are effective for entities that determine liquidation is imminent during annual reporting periods beginning after December 15, 2013, and interim reporting periods therein. Entities should apply the requirements prospectively from the day that liquidation becomes imminent. Early adoption is permitted. The adoption of this standard is not expected to have a material impact on the Company's financial position and results of operations.

In July 2013, the FASB issued ASU 2013-11, "Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists." ASU 2013-11 provides guidance on the presentation of unrecognized tax benefits related to any disallowed portion of net operating loss carryforwards, similar tax losses, or tax credit carryforwards, if they exist. ASU 2013-11 is effective for fiscal years beginning after December 15, 2013. The adoption of this standard is not expected to have a material impact on the Company's financial position and results of operations.

Other pronouncements issued by the FASB or other authoritative accounting standards groups with future effective dates are either not applicable or are not expected to be significant to the financial statements of the Company.

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COMMON STOCK, WARRANTS AND OPTIONS

12 Months Ended

Aug. 31, 2013

COMMON STOCK, WARRANTS AND OPTIONS [Abstract]

COMMON STOCK, WARRANTS AND OPTIONS

7. COMMON STOCK, WARRANTS AND OPTIONS

Common Stock

During the year ended August 31, 2013, the Company issued 240,012 shares of restricted stock to consultants for consulting services. The fair value of the restricted stock was estimated at $69,604.

During the year ended August 31, 2013, the Company received 40,320 shares of common stock from the Company's CFO as reimbursement for $5,645 of taxes paid on his behalf. Those shares were returned to the Company's treasury. As of August 31, 2013, there are 355,468 shares of common stock in the Company's treasury.

Warrants

Warrant transactions are summarized as follows:

	Number of warrants		Weighted average exercise price		Weighted average life remaining (in years)
Balance as at August 31, 2012
Issued		6,000,000		0.01	1.79 years
Additions as of August 31, 2013
Issued		7,710,172		0.50	4.85 years
Balance as at August 31, 2013		13,710,172		0.28	3.51 years

As of August 31, 2013, there were 13,710,172 warrants outstanding and exercisable with expiration dates commencing June 2015 through August 2018.

Except as set forth under limited circumstances, the warrants do not permit net cash settlement.

Stock Options

During the year ended August 31, 2013, the Board of Directors of the Company, through unanimous written consent, resolved to adopt the Company's 2013 Equity Incentive Plan (the "2013 Plan"), pursuant to which the Company may issue up to 30,000,000 shares or options to purchase shares of the Company's Common Stock to employees, officers, directors, consultants and advisors of the Company. The amount, terms, and exercisability provisions of grants are determined by the Board of Directors. There are 40,000,000 shares of common stock reserved for issuance under the 2013 Plan and the 2010 Plan (the "Plans"), of which 24,570,012 were granted, net of cancellations as of August 31, 2013. 

The purpose of the Plans is to provide the Company with the flexibility to use shares, options or other awards based on the Company's common stock as part of an overall compensation package to provide performance-based rewards to attract and retain qualified personnel. Such awards include, without limitation, options, stock appreciation rights, sales or bonuses of restricted stock, restricted stock units or dividend equivalent rights, and an award may consist of one such security or benefit, or two or more of them in any combination or alternative. Vesting of awards may be based upon the passage of time, the occurrence of one or more events, or the satisfaction of performance criteria or other conditions.

During the year ended August 31, 2013, the Company entered into separate agreements with  five independent consultants,  pursuant to which each of the respective consultants agreed to provide augmented reality consulting services for the Company's augmented reality activities. In consideration of the consulting services,  the Company granted these consultants a total of 22,600,000 Non-Qualified Stock Options (the "Options"), of which 8,050,000 Options were issued under the 2010 Equity Incentive Plan (the "2010 Plan") and 14,550,000 Options were issued under the 2013 Plan. The Options have an exercise price of $0.10, vesting on March 4, 2013 and expiring on March 5, 2018. As of August 31, 2013, 800,000 of these Options have been exercised and 300,000 have been forfeited and cancelled.

During the year ended August 31, 2013, the Company granted an officer a total of 230,000 Options issued under the 2010 Plan with an exercise price of $0.25, which Options vest on March 6, 2013 and expire on March 7, 2018.

During the year ended August 31, 2013, the Company entered into an At-Will Employment Agreement with Helen Papagiannis pursuant to which she will serve as the Chief Innovation Officer of the Company. Ms. Papagiannis will receive an annual base compensation of $200,000. Additionally, Ms. Papagiannis was granted 500,000 Options under the Company's 2010 Plan, with an exercise price of $0.25. 100,000 of such Options vest on March 6, 2013 and expire on March 7, 2018. 400,000 of such Options vest quarterly over the next 2 years (in equal amounts of 50,000 Options at the beginning of the Company's quarterly reporting periods, i.e. December 1, March 1, June 1 and September 1), and expire on March 7, 2018.

During the year ended August 31, 2013, the Company agreed in principle to appoint Enon Landenberg as President and Chief Executive Officer, through May 31, 2014 with an initial base compensation of $250,000 per year. Mr. Landenberg will also receive a total of 300,000 Options with an exercise price of $0.405, which Options vest on May 30, 2013 and expire on May 29, 2018. On July 31, 2013, Mr. Landenberg waived his rights to these Options, and they were summarily cancelled by the Company. In accordance with ASC 718-20-35-9, the cancellation of these options was unaccompanied by a concurrent grant and were accounted for as a repurchase for no consideration.

During the year ended August 31, 2013, the Company granted its former CEO a total of 100,000 Options issued under the 2013 Plan with an exercise price of $0.405, which Options vest on December 1, 2013 and expire on May 29, 2018.

During the year ended August 31, 2013, the Company granted 100,000 Options at an exercise price of $0.31 vesting on October 24, 2013 and expiring on October 23, 2017 to a director.

For the year ended August 31, 2013, the compensation expense of these options was $4,441,758 and is included in the Consolidated Statements of Operations.

Valuation Assumptions

The Company estimates the fair value of stock option grants using a Black-Scholes option pricing. In applying this model, the Company uses the following assumptions: 

· Risk-Free Interest Rate: The Company determined the risk-free interest rate equivalent to the expected term based on the U.S. Treasury constant maturity rate. 

· Expected Volatility: The Company determined its future stock price volatility based on the average historical stock price volatility of comparable peer companies.

· Expected Term: Due to the limited exercise history of the Company's stock options, the Company determined the expected term based on the stratification of employee groups and the expected effect of events that have indications on future exercise activity. Expected life for options granted to employees uses the Simplified Method, while options granted to non-employees uses an expected term equal to the life of the contract.

· Expected Dividend Rate: The Company has not paid and does not anticipate paying any cash dividends in the near future.

The fair value of each option award was estimated on the grant date using the Black Scholes option-pricing model and expensed under the straight line method. The following assumptions were used: 

	Year ended August 31, 2013		Year ended August 31, 2012
Exercise price		$0.100 - $0.405		n/a
Expected stock price volatility		71.5% - 72.0%		n/a
Risk-free rate of interest		0.76% - 1.01%		n/a
Expected life of options		4.15 - 4.75 Years		n/a

The aggregate fair value of the options at grant date was approximately $4,466,434.

The following table summarizes the stock-based compensation expense from stock option, employee stock purchase programs and restricted Common Stock awards for the years ended August 31, 2013 and 2012:

	Year ended August 31, 2013		Year ended August 31, 2012
Employee awards	$	155,714	$	-
Non- employee awards, net of forfeitures		4,355,648		-
Total stock compensation expense	$	4,511,362	$	-

The following table summarizes stock option activity:

	Number of Shares			Weighted Average Exercise Price		Total Weighted Average Intrinsic Value		Weighted Average Remaining Contractual Life  (in years)
Outstanding at August 31, 2012		-		$	-	$	-		-
Options granted		23,830,000			0.11		-		-
Options exercised		(800,000	)		-		-		-
Options forfeited		-			-		-		-
Options cancelled		(600,000	)		-		-		-
Outstanding at August 31, 2013		22,430,000			0.11		0.19		4.51
Options vested and expected to vest		22,430,000			0.11		0.19		4.51
Options vested and exercisable		21,980,000		$	0.10	$	0.20		4.52

As of August 31, 2013, the unamortized stock compensation expense is $24,676 which will be amortized over the period ended May 31, 2015.

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COMMON STOCK, WARRANTS AND OPTIONS (Tables)

12 Months Ended

Aug. 31, 2013

COMMON STOCK, WARRANTS AND OPTIONS [Abstract]

Schedule of Warrant Transactions

Warrant transactions are summarized as follows:

	Number of warrants		Weighted average exercise price		Weighted average life remaining (in years)
Balance as at August 31, 2012
Issued		6,000,000		0.01	1.79 years
Additions as of August 31, 2013
Issued		7,710,172		0.50	4.85 years
Balance as at August 31, 2013		13,710,172		0.28	3.51 years

Schedule of Stock Option Fair Value Assumptions

The fair value of each option award was estimated on the grant date using the Black Scholes option-pricing model and expensed under the straight line method. The following assumptions were used: 

	Year ended August 31, 2013		Year ended August 31, 2012
Exercise price		$0.100 - $0.405		n/a
Expected stock price volatility		71.5% - 72.0%		n/a
Risk-free rate of interest		0.76% - 1.01%		n/a
Expected life of options		4.15 - 4.75 Years		n/a

Schedule of Stock-Based Compensation Expense

The following table summarizes the stock-based compensation expense from stock option, employee stock purchase programs and restricted Common Stock awards for the years ended August 31, 2013 and 2012:

	Year ended August 31, 2013		Year ended August 31, 2012
Employee awards	$	155,714	$	-
Non- employee awards, net of forfeitures		4,355,648		-
Total stock compensation expense	$	4,511,362	$	-

Schedule of Stock Option Activity

The following table summarizes stock option activity:

	Number of Shares			Weighted Average Exercise Price		Total Weighted Average Intrinsic Value		Weighted Average Remaining Contractual Life  (in years)
Outstanding at August 31, 2012		-		$	-	$	-		-
Options granted		23,830,000			0.11		-		-
Options exercised		(800,000	)		-		-		-
Options forfeited		-			-		-		-
Options cancelled		(600,000	)		-		-		-
Outstanding at August 31, 2013		22,430,000			0.11		0.19		4.51
Options vested and expected to vest		22,430,000			0.11		0.19		4.51
Options vested and exercisable		21,980,000		$	0.10	$	0.20		4.52

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DISCONTINUED OPERATIONS (Tables)

12 Months Ended

Aug. 31, 2013

DISCONTINUED OPERATIONS [Abstract]

Schedule of Discontinued Operations, Income Statement and Balance Sheet

Discontinued operations on the consolidated statement of operations for the year ended August 31, 2013 and 2012 are as follows:

	Year ended August 31, 2013			Year ended August 31, 2012
Sales, general and administrative expenses	$	(204,200	)	$	(2,175,602	)
Other income (expense)
Realized gain on life settlement contracts held under investment method		-			319,843
Realized loss on extinguishment of debt		(8,438,584	)		-
Change in fair value of life settlement contracts net of premiums paid		2,055,438			(36,460,974	)
Interest expense		(1,610,571	)		(626,710	)
Loss from discontinued operations before income tax		(8,197,917	)		(38,943,443	)
Income tax benefit		3,879,477			16,576,223
Net loss from discontinued operations	$	(4,318,440	)	$	(22,367,220	)

Assets and liabilities of discontinued operations for the Company's life settlements business on the consolidated balance sheets consist of the following:

	August 31, 2013		August 31, 2012
ASSETS
Current Assets
Cash and cash equivalents	$	-	$	228,165
Investment in life settlement contracts at investment method		-		4,334,012
Total current assets of discontinued operations		-		4,562,177
Investment in life settlement contracts at fair value		-		64,667,124
Deferred income taxes		145,781		-
Total noncurrent assets of discontinued operations	$	145,781	$	64,667,124
LIABILITIES
Current Liabilities
Interest payable	$	-	$	626,710
Loans payable		-		59,450,000
Income and other taxes payable		775,000		-
Total current liabilities of discontinued operations		775,000		60,076,710
Deferred income taxes		-		4,433,696
Total long-term liabilities of discontinued operations	$	-	$	4,433,696

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Document And Entity Information (USD $)	12 Months Ended
	Aug. 31, 2013	Dec. 10, 2013	Feb. 28, 2013
Document and Entity Information [Abstract]
Entity Registrant Name	Infinity Augmented Reality, Inc.
Entity Central Index Key	0001421538
Current Fiscal Year End Date	--08-31
Entity Filer Category	Smaller Reporting Company
Trading Symbol	also
Entity Common Stock, Shares Outstanding		93,628,551
Document Type	10-K
Amendment Flag	false
Document Period End Date	Aug. 31, 2013
Document Fiscal Period Focus	FY
Document Fiscal Year Focus	2013
Entity Well-known Seasoned Issuer	No
Entity Voluntary Filers	Yes
Entity Current Reporting Status	No
Entity Public Float			$ 19,126,236

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CONVERTIBLE DEBENTURES (Tables)

12 Months Ended

Aug. 31, 2013

CONVERTIBLE DEBENTURES [Abstract]

Schedule of Warrant Valuation Assumptions

The Company valued the warrants at the date the warrants were issued, using the Black-Scholes valuation model and the following assumptions:

	April 23, 2013			May 17, 2013			May 22, 2013			May 29, 2013
Contractual term (Years)		5.0			5.0			5.0			5.0
Volatility		71.0	%		71.9	%		71.7	%		72.0	%
Dividend yield		0.0	%		0.0	%		0.0	%		0.0	%
Risk-free interest rate		0.70	%		0.79	%		0.84	%		1.02	%
	July 2, 2013			July 29, 2013			August 27, 2013
Contractual term (Years)		5.0			5.0			5.0
Volatility		72.0	%		74.4	%		74.6	%
Dividend yield		0.0	%		0.0	%		0.0	%
Risk-free interest rate		1.39	%		1.36	%		1.61	%

Schedule of Senior Convertible Notes

Senior convertible notes consist of the following at August 31, 2013:

1.2% convertible debentures (issued April 23, 2013)	$	200,000
Debt discount/ beneficial conversion feature		185,761
Balance		14,239
Accrued interest payable	$	855
1.2% convertible debentures (issued May 17, 2013)	$	200,000
Debt discount/ beneficial conversion feature		139,066
Balance		60,934
Accrued interest payable	$	697
1.2% convertible debentures (issued May 22, 2013)	$	202,543
Debt discount/ beneficial conversion feature		177,410
Balance		25,133
Accrued interest payable	$	673
1.2% convertible debentures (issued May 29, 2013)	$	225,000
Debt discount/ beneficial conversion feature		213,417
Balance		11,583
Accrued interest payable	$	695
1.2% convertible debentures (issued July 2, 2013)	$	250,000
Debt discount/ beneficial conversion feature		241,781
Balance		8,219
Accrued interest payable	$	493
1.2% convertible debentures (issued July 29, 2013)	$	400,000
Debt discount/ beneficial conversion feature		392,767
Balance		7,233
Accrued interest payable	$	434
1.2% convertible debentures (issued August 27, 2013)	$	450,000
Debt discount/ beneficial conversion feature		449,014
Balance		986
Accrued interest payable	$	59