FIN HOLDINGS ACQUISITION

9 Months Ended

Sep. 30, 2016

Business Combinations [Abstract]

FIN HOLDINGS ACQUISITION

NOTE 2 – FIN HOLDINGS ACQUISITION

On February 8, 2016, the Company entered into a Share Exchange Agreement with Fin Holdings, Inc., a Florida corporation ("FIN"), and all of the FIN shareholders (the "FIN Shareholders"), pursuant to which the Company acquired 100% of the issued and outstanding shares of FIN (the "FIN Shares") and FIN's two wholly-owned subsidiaries, ID Solutions, Inc. and Cards Plus Pty Ltd. (collectively, the "Subsidiaries"), from the FIN Shareholders. One of the FIN shareholders was the Company’s Chief Operating Officer and owned approximately 1.7% of the Company’s outstanding common stock at the acquisition date. In consideration for the FIN Shares, the Company issued and sold to the FIN Shareholders an aggregate of 22,500,000 shares of common stock of the Company (the "Purchase Shares") at a per share price of $0.40 which is equivalent to $9,000,000. The closing occurred on February 8, 2016.

In accordance with ASC 805, “Business Combinations”, the Company accounted for the acquisition of FIN as a business combination of FIN using the acquisition method of accounting. The purchase price was allocated to specific identifiable tangible and intangible assets at their respective fair values at the date of acquisition.

The following table summarizes the total fair value of the consideration transferred as well as the fair values of the assets and liabilities assumed.

Common stock consideration	$	9,000,000
Liabilities assumed		914,218
Total purchase consideration		9,914,218
Current assets		(843,317	)
Property and equipment		(100,339	)
Customer relationships		(1,587,159	)
Intellectual property		(814,049	)
Goodwill	$	6,569,354

Goodwill is calculated as the excess of the consideration transferred over the net assets recognized and represents the expected revenue and benefits of the combined company. FIN was acquired on February 8, 2016 pursuant to a Share Exchange Agreement at which time control was achieved through a restructuring of the reporting hierarchy to Company management.

The condensed consolidated financial statements for the nine months ended September 30, 2016 include FIN’s results for the period from the date of acquisition to September 30, 2016. FIN Holdings Revenue and operating income in the consolidated results of operations for the nine months ended September 30, 2016, was approximately $1,118,000 and $264,000 respectively.

The following unaudited proforma financial information gives effect to the Company’s acquisition of FIN as if the acquisition had occurred on January 1, 2015 and had been included in the Company’s consolidated statement of operations for the nine months ended September 30, 2016 and September June 30, 2016.

	Nine months ended September 30
	2016		2015
Proforma net revenues	$	1,528,498	$	1,577,701
Proforma net income (loss)	$	2,519,242	$	(32,385,487	)