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BASIS OF PRESENTATION (Policies)

9 Months Ended

Sep. 30, 2016

Basis Of Presentation Policies

Net Loss per Common Share

Net Loss per Common Share

The Company computes net income or loss per share in accordance with FASB ASC 260, "Earnings per Share". ASC 260 requires presentation of both basic and diluted earnings per share (EPS) on the face of the statement of operations. Basic EPS is computed by dividing net income (loss) available to common shareholders by the weighted average number of common shares outstanding during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period including stock options, using the treasury stock method, and convertible notes and stock warrants, using the if-converted method. In computing diluted EPS, the average stock price for the period is used in determining the number of shares assumed to be purchased from the exercise of stock options, warrants and conversion of convertible notes. Diluted EPS excludes all dilutive potential common shares if their effect is anti-dilutive. The following table illustrates the computation of basic and diluted EPS:

		For the nine-months ended September 30, 2016
										Per-Share
		Income				Shares				Amount
Basic EPS
Income available to stockholders		$	2,526,783				212,790,554			$	.01

Effect of Dilutive Securities
Stock Options			-				17,037,007
Warrants			-				21,350,729
Convertible Debt			(15,333,674	)			38,680,621

Diluted EPS
Income available to stockholders plus assumed conversions		$	(12,806,891	)			289,858,911			$	(0.04	)

Going concern

As of September 30, 2016, the Company has a working capital and accumulated deficit of approximately $14.4 million, and $36.5 million, respectively. For the nine months ended September 30, 2016 the Company earned revenue of approximately $1.4 million and incurred a loss from operations of approximately $10.4 million.

These consolidated financial statements have been prepared on a going concern basis, which implies the Company will continue to meet its obligations and continue its operations for the next fiscal year. The continuation of the Company as a going concern is dependent upon financial support from the Company’s current shareholders, the ability of the Company to obtain additional equity financing to continue operations, the Company’s ability to generate sufficient cash flows from operations, successfully locating and negotiating with other business entities for potential acquisition and /or acquiring new clients to generate revenues and cash flows.

There is no assurance that the Company will ever be profitable. These consolidated financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classifications of liabilities that may result should the Company be unable to continue as a going concern.

Inventories

Inventories of kiosks held by IDGS S.A.S are stated at the lower of cost (using the first-in, first-out method) or market. The kiosks provide electronic ticketing for transit systems. Inventory of plastic/ID cards, digital printing material, which are held by Cards Plus Pty Ltd., are at the lower of cost (using the average method) or market. The Plastic/ID cards and digital printing material are used to provide plastic loyal ID and other types of cards. Inventories at September 30, 2016 consist solely of cards inventory as the kiosks were deployed in the second quarter of 2016 subject to a direct financing lease.

Income Taxes

The Company accounts for income taxes under Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 740 “Income Taxes.” Under the asset and liability method of FASB ASC 740, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Under FASB ASC 740, the effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period the enactment occurs. A valuation allowance is provided for deferred tax assets if it is more likely than not that the Company will not realize tax assets through future operations. For the three and nine months ending September 30, 2016, there is no provision for income tax as the Company had a tax loss for United States and foreign activities and the Company’s net deferred tax assets which consist primarily of net operating loss carryforwards have a full valuation allowance. The Company’s gain on derivative liability during the three and nine months ended September 30, 2016 and 2015, is not taxable.

Leases

All leases are classified at the inception as direct finance leases or operating leases based on whether the lease transfers substantially all the risks and rewards of ownership.

Leases that transfer to the lessee substantially all of the risks and rewards incidental to ownership of the asset are classified as direct finance leases.

Revenue Recognition

Revenue Recognition

The Company recognizes revenue when products are shipped or services have been performed. Revenue related to direct financing leases is recognized over the term of the lease using the effective interest method.

Disclosure of accounting policy for income taxes, which may include its accounting policies for recognizing and measuring deferred tax assets and liabilities and related valuation allowances, recognizing investment tax credits, operating loss carryforwards, tax credit carryforwards, and other carryforwards, methodologies for determining its effective income tax rate and the characterization of interest and penalties in the financial statements.

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Disclosure of accounting policy for leasing arrangements (both lessor and lessee). This disclosure may address (1) lease classification (that is, operating versus capital), (2) how the term of a lease is determined (for example, the circumstances in which a renewal option is considered part of the lease term), (3) how rental revenue or expense is recognized for a lease that contains rent escalations, (4) an entity's accounting treatment for deferred rent, including that which arises from lease incentives, rent abatements, rent holidays, or tenant allowances (5) an entity's accounting treatment for contingent rental payments and (6) an entity's policy for reviewing, at least annually, the residual values of sales-type and direct-finance leases. The disclosure also may indicate how the entity accounts for its capital leases, leveraged leases or sale-leaseback transactions.

+ References + Details