10-Q

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

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

For the quarterly period ended November 30, 2019

☐   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: 333-178210

SERVICE TEAM INC.

(Exact name of registrant as specified in its charter)

Wyoming	61-1653214
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

18482 Park Villa Place, Villa Park, California 92861

(Address of principal executive offices) (Zip Code)

(714) 538-5214

(Registrant's telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.     Yes  ☒    No  ☐

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

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

Large accelerated filer ☐         Accelerated filer ☐         Non-accelerated filer ☐       

Smaller reporting company ☒       Emerging growth company  ☐       

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.☐  

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

Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of January 14, 2019:  8,852,873,544 common shares and 150,000 shares of preferred stock.

PART I — FINANCIAL INFORMATION

Item 1. Financial Statements.

TABLE OF CONTENTS

		Page
Financial Statements
	Consolidated Balance Sheets as of November 30, 2019 (Unaudited) and August 31, 2019	3
	Consolidated Statements of Operations for the three months periods ended November 30, 2019 and November 30, 2018 (Unaudited)	4
	Consolidated Statement of Shareholders' Equity for the year ended August 31, 2019 and the three months ended November 30, 2019 (Unaudited)	5
	Consolidated Statement of Cash Flows for the three months ended November 30, 2019 and November 30, 2018 (Unaudited)	6
	Notes to the Consolidated Financial Statements (Unaudited)	7

2 

SERVICE TEAM INC.

CONSOLIDATED BALANCE SHEETS

AS OF NOVEMBER 30, 2019 (UNAUDITED) AND AUGUST 31, 2019

	11/30/19			8/31/19
ASSETS
Cash	$	23,153		$	52,636
Accounts receivable, net		376,285			344,266
Total Current Assets		399,438			396,902
Property and equipment, net		155,434			157,736
Prepaid Expenses – non-current		14,000			14,000
TOTAL ASSETS	$	568,872		$	568,638
LIABILITIES & SHAREHOLDERS' EQUITY
Accounts payable	$	109,162		$	82,564
Loan-Employee		1,300			1,300
Convertible notes payable net – currently in default		136,632			140,232
Promissory note payable net		—			10,120
Accrued expense		62,652			63,521
Accrued interest		90,256			84,866
TOTAL LIABILITIES	$	400,002		$	382,603
SHAREHOLDERS' EQUITY
Common stock, $0.001 par value, 20,000,000,000 authorized, and 8,852,873,544 issued and outstanding as of November 30, 2019 and 8,852,873,544 issued and outstanding as of August 31, 2019 respectively.		8,852,874			8,852,874
Preferred stock – Series A, $0.001 par value, 150,000 authorized, 150,000 and 150,000 issued and outstanding as of November 30, 2019 and August 31, 2019, respectively.		150			150
Additional paid in capital		(5,611,302	)		(5,611,302	)
Stock payable		—			—
Accumulated deficit		(3,072,852	)		(3,055,687	)
TOTAL SHAREHOLDERS' EQUITY		168,870			186,035
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY		568,872			568,638

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

3 

SERVICE TEAM INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

FOR THE THREE MONTH PERIODS ENDING

NOVEMBER 30, 2019 AND NOVEMBER 30, 2018 (UNAUDITED)

	3 Months Ended 11/30/19			3 Months Ended 11/30/18
REVENUES
Sales	$	994,625		$	993,889
COST OF SALES
Cost of sales		824,002			717,017
Gross Margin		170,623			276,872
OPERATING EXPENSES
General & administrative expenses		174,689			126,460
Depreciation expense		4,017			4,206
Total Operating Expenses		178,706			130,666
INCOME FROM OPERATIONS
OTHER EXPENSE
Interest Expense		(9,082	)		32,680
Total Other Expense		(9,082	)		32,680
NET INCOME (LOSS)	$	(17,165	)	$	113,526
Weighted average number of common shares outstanding – basic		8,852,873,544			8,852,873,544
Weighted average number of common shares outstanding – fully diluted		8,852,873,544			11,515,613,544
Net income (loss) per share - basic	$	(0.00	)	$	0.00
Net income (loss) per share - fully diluted	$	(0.00	)	$	0.00

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

4 

CONSOLIDATED STATEMENT OF SHAREHOLDERS DEFICIT FOR THE YEAR

ENDED AUGUST 31, 2019 AND THE THREE MONTHS ENDED NOVEMBER 30, 2019 (UNAUDITED)

	Common Stock				Preferred Stock				Additional Paid In			Stock		Accumulated
	Shares		Amount		Shares		Amount		Capital			Payable		Deficit		Total
Balance, August 31, 2018		8,852,873,544	$	8,852,874		150,000	$	150	$	(5,611,302)		$	-	$	(3,056,563)	$	185,159
Net Income		-		-		-		-		-			-		876		876
Balance August 31, 2019		8,852,873,544	$	8,852,874		150,000	$	150	$	(5,611,302	)	$	-	$	(3,055,687)	$	186,035
Stock Payable for Note Conversion		-		-		-		-		-			-		-		-
Net Loss		-		-		-		-		-			-		(17,165)		(17,165)
Balance November 30, 2019		8,852,873,544	$	8,852,874		150,000	$	150	$	(5,611,302	)		-		(3,072,852)		168,870

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

5 

SERVICE TEAM INC.

 CONSOLIDATED STATEMENT OF CASH FLOWS

FOR THE THREE MONTHS PERIOD ENDED NOVEMBER 30, 2019

AND NOVEMBER 30, 2018 (UNAUDITED)

	3 Months Ended 11/30/19			3 Months Ended 11/30/18
CASH FLOWS FROM OPERATING ACTIVITIES
Net Income (Loss)	$	(17,165	)	$	113,526
Adjustments to reconcile net income (loss) with cash provided by (used in) operations:		—			—
Debt discount amortization		3,279			19,881
Depreciation		4,017			4,206
CHANGE IN OPERATING ASSETS AND LIABILITIES
Accounts receivable		(32,019	)		(28,815	)
Accrued expenses		4,521			5,760
Accounts payable		26,598			17,805
Net Cash Provided by (Used in) Operating Activities		(10,769	)		132,363
CASH FLOWS FROM INVESTING ACTIVITIES
Cash paid for purchase of fixed assets		(1,715	)		—
Net Cash Used in Investing Activities		(1,715	)		—
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from convertible debt – third party		—			—
Payments on promissory notes – third party		(16,999	)		(39,656	)
Net Cash Provided by (Used in) Financing Activities		(16,999	)		39,656
Net Increase (Decrease) In Cash and Cash Equivalents		(29,483	)		92,707
Cash at Beginning of Period		52,636			48,855
Cash at End of period	$	23,153		$	141,562
Supplemental Disclosures
Interest Paid		413			—
Taxes Paid		—			—

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

6 

SERVICE TEAM, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

AT NOVEMBER 30, 2019 (UNAUDITED)

NOTE 1 - ORGANIZATION

Organization

Service Team Inc. (the "Company") was incorporated pursuant to the laws of the State of Nevada on June 6, 2011.  The Company was organized to comply with the warranty obligations of electronic devices manufactured by companies outside of the United States.  The business proved to be unprofitable and the Company reduced its warranty and repair operations.  On June 5, 2013, Service Team Inc. acquired Trade Leasing, Inc. for 4,000,000 shares of its common stock, a commonly held company.  Trade Leasing, Inc., a California corporation, was incorporated on November 1, 2011, and commenced business January 1, 2013.  Trade Leasing, Inc. is principally involved in the manufacturing, maintenance and repair of truck bodies.   On September l, 2018, Service Team Inc. changed its state of domicile from the state of Nevada to the state of Wyoming.    

The Company has established a fiscal year end of August 31.

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The consolidated financial statements presented in this report are the combined financial reports of Trade Leasing, Inc. and Service Team Inc. 

The Company maintains its accounting records on an accrual basis in accordance with generally accepted accounting principles in the United States of America (U.S. GAAP).

The consolidated financial statements present the Balance Sheet, Statements of Operations, Shareholders' Equity and Cash Flows of the Company. These consolidated financial statements are presented in United States dollars. The accompanying audited, consolidated financial statements have been prepared in accordance with the instructions to Form 10-Q.  All adjustments which are, in the opinion of management, necessary for a fair presentation of the results of operations for the interim periods have been made and are of a recurring nature unless otherwise disclosed herein.

Principles of Consolidation

The accompanying consolidated financial statements include the accounts of Service Team Inc. and Trade Leasing, Inc. both of which are under common control and ownership. The consolidated financial statements herein contain the operations of the wholly-owned subsidiaries listed above. All significant inter-company transactions have been eliminated in the preparation of these financial statements. 

7 

Use of Estimates

The preparation of the consolidated financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, and disclosure of contingent liabilities at the date of the financial statements and the reported amounts of expenses during the reporting period.  Actual results could differ from those estimates. 

Going Concern

The Company's financial statements are prepared using the accrual method of accounting in accordance with accounting principles generally accepted in the United States of America, and have been prepared on a going concern basis, which contemplates the realization of assets and the settlement of liabilities in the normal course of business. The Company has an accumulated deficit as of November 30, 2019 of $3,072,852 and is dependent on raising capital through placement of our common stock in order to implement its business plan. There can be no assurance that the Company will be successful in order to continue as a going concern. The Company is funding its initial operations by issuing common shares and debt.  We cannot be certain that capital will be provided when it is required.

 Cash and Equivalents

Cash and equivalents include investments with initial maturities of three months or less. The Company maintains its cash balances at credit-worthy financial institutions that are insured by the Federal Deposit Insurance Corporation ("FDIC") up to $250,000. There were no cash equivalents at November 30, 2019, or August 31, 2019.

Concentration of Credit Risk

Financial instruments and related items, which potentially subject the Company to concentrations of credit risk, are cash and cash equivalents. The Company places its cash and temporary cash investments with credit quality institutions. At times, such investments may be in excess of FDIC insurance limits.

Accounts Receivable

All accounts receivable are due thirty (30) days from the date billed. If the funds are not received within thirty (30) days the customer is contacted to arrange payment. The Company uses the allowance method to account for uncollectable accounts receivable. Whilst management is confident that its customers will settle their debts, it has recorded an allowance for doubtful accounts in amount of $14,310 as of November 30, 2019 and August 31, 2019

Accounts Receivable and Revenue Concentrations

The company has approximately 400 customers. One customer South Bay Ford represented more than 10% of sale in the last 12 months. The company is not dependent on a few major customers.

8 

Inventory

The Company does not own inventory, materials are purchased as needed from local suppliers; therefore, there was no additional inventory on hand at November 30, 2019 or August 31, 2019. 

Property and Equipment

Equipment, vehicles and furniture, which are recorded at cost, consist primarily of fabrication equipment and are depreciated using the straight-line method over the estimated useful lives of the related assets (generally 15 years or less). Costs incurred for maintenance and repairs are expensed as incurred and expenditures for major replacements and improvements are capitalized and depreciated over their estimated remaining useful lives. There was $4,017 and $4,206 of depreciation expense during the three months ended November 30, 2019 and 2018, respectively. 

 Net property and equipment were as follows at November 30, 2019 and August 31, 2019: 

	11-30-19		8-31-19
Equipment	$	369,673	$	367,958
Vehicles		15,000		15,000
Furniture		24,000		24,000
Leasehold improvements		52,826		52,826
Subtotal		461,499		459,784
Less: accumulated depreciation		306,065		(302,048	)
Total Fixed Assets, Net	$	155,434	$	157,736

Lease Commitments

Service Team Inc. leases facilities at 1818 Rosslynn Avenue, Fullerton, California, to manufacture its products.   The facility is leased for six and one half years at a price of $10,000 per month, for the first six months; and, $14,000 per month thereafter.  Service Team Inc pays for the fire insurance and property taxes on the building estimated to be approximately $2,000 per month. The location consists of three acres of land and one building of approximately 30,000 square feet.   As of November 30, 2019, the deferred rent related to this lease was $7,333 and is included in accrued expenses.

The table below discloses the Company’s future minimum lease payment obligations as of November 30, 2019.

2020	$	126,000
2021		168,000
2022		14,000
TOTAL:	$	308,000

9 

Beneficial Conversion Features

From time to time, the Company may issue convertible notes that may contain an imbedded beneficial conversion feature. A beneficial conversion feature exists on the date a convertible note is issued when the fair value of the underlying common stock to which the note is convertible into is in excess of the remaining unallocated proceeds of the note after first considering the allocation of a portion of the note proceeds to the fair value of warrants, if related warrants have been granted. The intrinsic value of the beneficial conversion feature is recorded as a debt discount with a corresponding amount to additional paid in capital. The debt discount is amortized to interest expense over the life of the note using the effective interest method.

Fair Value of Financial Instruments

The Company adopted Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) 820 on June 6, 2011. Under this FASB, fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (an exit price). The standard outlines a valuation framework and creates a fair value hierarchy in order to increase the consistency and comparability of fair value measurements and the related disclosures. Under GAAP, certain assets and liabilities must be measured at fair value, and FASB ASC 820-10-50 details the disclosures that are required for items measured at fair value.

 The Company has various financial instruments that must be measured under the new fair value standard including: cash, convertible notes payable, accrued expenses, promissory notes payable, accounts receivable and accounts payable. The Company's financial assets and liabilities are measured using inputs from the three levels of the fair value hierarchy. The three levels are as follows:   

Level 1 – Inputs are unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date.  The fair value of the Company's cash is based on quoted prices and therefore classified as Level 1. 

Level 2 - Inputs include quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability (e.g., interest rates, yield curves, etc.), and inputs that are derived principally from or corroborated by observable market data by correlation or other means (market corroborated inputs).

Level 3 - Unobservable inputs that reflect our assumptions about the assumptions that market participants would use in pricing the asset or liability.

Cash, accounts receivable, accounts payable, promissory notes, convertible notes and accrued expenses reported on the balance sheet are estimated by management to approximate fair market value due to their short-term nature.

10 

 The following table presents assets and liabilities that were measured and recognized at fair value as of November 30, 2019 on a recurring basis:

Description	Level 1		Level 2		Level 3		Total Realized Loss
Convertible Note Payable-net	$	0	$	—	$	—	$	—
Convertible Note Payable-net, in default		136,632		—		—		—
Total	$	136,632		—		—		—

The following table presents assets and liabilities that were measured and recognized at fair value as of August 31, 2019 on a recurring basis: 

Description	Level 1		Level 2		Level 3		Total Realized Loss
Convertible Note Payable-net	$	140,232	$	—	$	—	$	—
Total	$	140,232		—		—		—

Income Taxes

In assessing the realization of deferred tax assets, the Company considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. The Company considers the scheduled reversal of deferred tax liabilities, projected future taxable income, and tax planning strategies in making this assessment. Based on the level of historical operating results and the uncertainty of the economic conditions, the Company has recorded a full valuation allowance against its deferred tax assets at November 30, 2019 and August 31, 2019 where it cannot conclude that it is more likely than not that those assets will be realized.

Revenue Recognition

Trade Leasing Inc dba Delta Stag Manufacturing

Service Team Inc, 100% owned subsidiary Trade Leasing Inc dba Delta Stag Manufacturing receives orders from customers to build or repair truck bodies. The company builds the requested product. At the completion of the product the truck is delivered to the customer.  If the customer accepts the product Trade Leasing Inc dba Delta Stag Manufacturing issues an invoice to the customer for the job. The invoice is entered into our accounting system and is recognized as revenue at that time.

In Trade Leasing Inc we use the completed contract method for truck bodies built, which typically have construction periods of 15 days or less. Contracts are considered complete when title has passed, the customer has accepted the product and we do not retain risks or rewards of ownership of the truck bodies. Losses are accrued if manufacturing costs are expected to exceed manufacturing contract revenue.  Manufacturing expenses are primarily composed of aluminum cost, which is the largest component of our raw materials cost and the cost of labor. 

11 

On September 1, 2018, we adopted Accounting Standards Update No. 2014-09, Revenue from Contracts with Customers (Topic 606), which supersedes the revenue recognition requirements in Accounting Standards Codification (ASC) Topic 605, Revenue Recognition (Topic 605). Results for reporting periods beginning after September 1, 2018 are presented under Topic 606. The impact of adopting the new revenue standard was not material to our financial statements and there was no adjustment to beginning retained earnings on September 1, 2018.

Under Topic 606, revenue is recognized when control of the promised goods or services is transferred to our customers, in an amount that reflects the consideration we expect to be entitled to in exchange for those goods or services.

We determine revenue recognition through the following steps:

●identification of the contract, or contracts, with a customer;

●identification of the performance obligations in the contract;

●determination of the transaction price;

●allocation of the transaction price to the performance obligations in the contract; and

●recognition of revenue when, or as, we satisfy a performance obligation. 

Share Based Expenses

The Company accounts for the issuance of equity instruments to acquire goods and/or services based on the fair value of the goods and services or the fair value of the equity instrument at the time of issuance, whichever is more readily determinable. The Company's accounting policy for equity instruments issued to consultants and vendors in exchange for goods and services follows the provisions of standards issued by the FASB. The measurement date for the fair value of the equity instruments issued is determined at the earlier of (i) the date at which a commitment for performance by the consultant or vendor is reached or (ii) the date at which the consultant or vendor's performance is complete. In the case of equity instruments issued to consultants, the fair value of the equity instrument is recognized over the term of the consulting agreement.

Stock Based Compensation

In December of 2004, the FASB issued a standard which applies to transactions in which an entity exchanges its equity instruments for goods or services and also applies to liabilities an entity may incur for goods or services that are based on the fair value of those equity instruments. For any unvested portion of previously issued and outstanding awards, compensation expense is required to be recorded based on the previously disclosed methodology and amounts. Prior periods presented are not required to be restated. We adopted the standard as of inception.  The Company has not issued any stock options to its Board of Directors and officers as compensation for their services.  If options are granted, they will be accounted for at a fair value as required by the FASB ASC 718.

12 

Net Loss Per Share

The Company adopted the standard issued by the FASB, which requires presentation of basic earnings or loss per share and diluted earnings or loss per share. Basic income (loss) per share ("Basic EPS") is computed by dividing net income (loss) available to common stockholders by the weighted average number of common shares outstanding during the period. Diluted earnings per share ("Diluted EPS") are similarly calculated using the treasury stock method except that the denominator is increased to reflect the potential dilution that would occur if dilutive securities at the end of the applicable period were exercised.  During the three month period ended November 30, 2018, because the Company operations resulted in net income, therefore additional dilutive securities were included in the diluted EPS.   During the three month period ended November 30, 2019, there were net losses; therefore, no additional dilutive securities were included in the diluted EPS as that would be anti-dilutive to the resulting diluted earnings per share.
 

Recent Accounting Pronouncements

In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842): Accounting for Leases. This update requires that lessees recognize right-of-use assets and lease liabilities that are measured at the present value of the future lease payments at lease commencement date. The recognition, measurement, and presentation of expenses and cash flows arising from a lease by a lessee will largely remain unchanged and shall continue to depend on its classification as a finance or operating lease. The Company has performed a comprehensive review in order to determine what changes were required to support the adoption of this new standard. The Company will elect the optional transition method that allows for a cumulative-effect adjustment in the period of adoption and will not restate prior periods. Under the new guidance, the Company’s lease will continue to be classified as operating. During fiscal 2020, the Company will complete its implementation of its processes and policies to support the new lease accounting and reporting requirements. The adoption of this ASU is not expected to have a significant impact on our Consolidated Statements of Operations or Cash Flows.

In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606), to clarify the principles of recognizing revenue and create common revenue recognition guidance between U.S. GAAP and International Financial Reporting Standards. Under ASU 2014-09, revenue is recognized when a customer obtains control of promised goods or services and is recognized at an amount that reflects the consideration expected to be received in exchange for such goods or services. In addition, ASU 2014-09 requires disclosure of the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. The ASU is effective for fiscal years beginning after December 15, 2017. The new revenue standard is principle based and interpretation of those principles may vary from company to company based on their unique circumstances. It is possible that interpretation, industry practice, and guidance may evolve as companies and the accounting profession work to implement this new standard. The implementation of this standard did not have a material effect on the Company’s results of operations.

13 

In January 2017, the FASB issued ASU No. 2017-04, Simplifying the Test for Goodwill Impairment, which simplifies the subsequent measurement of goodwill by eliminating Step 2 from the goodwill impairment test. In computing the implied fair value of goodwill under Step 2, current U.S. GAAP requires the performance of procedures to determine the fair value at the impairment testing date of assets and liabilities (including unrecognized assets and liabilities) following the procedure that would be required in determining the fair value of assets acquired and liabilities assumed in a business combination. Instead, the amendments under this ASU require the goodwill impairment test to be performed by comparing the fair value of a reporting unit with its carrying amount. An impairment charge should be recognized for the amount by which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. The ASU becomes effective for the Company on January 1, 2020. The amendments in this ASU will be applied on a prospective basis. Early adoption is permitted for interim or annual goodwill impairment tests performed.

In August 2016, the Financial Accounting Standards Board (the “FASB”) issued ASU 2016-15, Statement of Cash Flows (Topic 230). The update addresses eight specific cash flow issues and is intended to reduce diversity in practice in how certain cash receipts and cash payments are presented and classified in the statement of cash flows. This update is effective for reporting periods beginning after December 15, 2017, including interim periods within the reporting period. Adoption of ASU 2016-15 did not have a material effect on our financial statements.

In May 2017, the FASB issued ASU No. 2017-09, Stock Compensation - Scope of Modification Accounting, which provides guidance on which changes to the terms or conditions of a share-based payment award require an entity to apply modification accounting. The ASU requires that an entity account for the effects of a modification unless the fair value (or calculated value or intrinsic value, if used), vesting conditions and classification (as equity or liability) of the modified award are all the same as for the original award immediately before the modification. The ASU became effective for the Company on January 1, 2018 and will be applied to an award modified on or after the adoption date. Adoption of ASU 2017-09 did not have a material effect on the Company’s financial statements.

Effective June 1, 2018, the Company adopted Accounting Standards Codification (“ASC”) 606 — Revenue from Contracts with Customers. Under ASC 606, the Company recognizes revenue from the commercial sales of products, licensing agreements and contracts to perform pilot studies by applying the following steps: (1) identify the contract with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to each performance obligation in the contract; and (5) recognize revenue when each performance obligation is satisfied. For the comparative periods, revenue has not been adjusted and continues to be reported under ASC 605 — Revenue Recognition. Under ASC 605, revenue is recognized when the following criteria are met: (1) persuasive evidence of an arrangement exists; (2) the performance of service has been rendered to a customer or delivery has occurred; (3) the amount of fee to be paid by a customer is fixed and determinable; and (4) the collectability of the fee is reasonably assured. There was no impact on the Company’s financial statements as a result of adopting ASC 606.

There are various other updates recently issued, most of which represented technical corrections to the accounting literature or application to specific industries and are not expected to a have a material impact on the Company’s consolidated financial position, results of operations or cash flows.

14 

NOTE 3 – CAPITAL STOCK

The Company's authorized capital is 20,000,000,000 common shares with a par value of $0.001 per share and 150,000 preferred shares with a par value of $0.001 per share.  

Common Shares

On February 12, 2016, the Articles of Incorporation were amended to increase the authorized shares of capital stock to 500,000,000.   On December 20, 2016, the Articles of Incorporation were amended to increase the authorized share of capital stock to 1,000,000,000.    On January 19, 2017, the Articles of Incorporation were amended to increase the authorized share of capital stock to 2,000,000,000.   On February 16, 2017, the Articles of Incorporation were amended to increase the authorized share of capital stock to 3,000,000,000.   On April 27, 2017, the Articles of Incorporation were amended to increase the authorized share of capital stock to 4,500,000,000.  On June 13, 2017, the Articles of Incorporation were amended to increase the authorized share of capital stock to 8,000,000,000.   On June 28, 2017, the Articles of Incorporation were amended to increase the authorized share of capital stock to 10,000,000,000.  On August 22, 2017, the Company moved its state of domicile from Nevada to Wyoming, and in the process of the transfer increased its authorized common stock to 20,000,000,000.

Preferred Shares

On January 23, 2015, Service Team Inc. filed with the Secretary of State of Nevada a Certificate of Designation for 100,000 shares of Series A Preferred Stock.  The Designation gives the Series A Preferred Stock 500 votes per share.   Series A Preferred Stock were not entitled to receive dividends, any liquidation preference, or conversion rights.  On October 16, 2015, the Designation of Preferred Stock was amended to allow Preferred Shareholders to receive dividends in an amount equal to dividends paid per share on Common Stock.  On July 27, 2016, an amendment was filed to increase the voting rights of the preferred stock from 500 votes per share to 10,000 votes per share. The Series A share amendments valued according to the additional voting rights and dividend rights assigned. The value assigned to the dividend rights was derived from a model utilizing future economic value of the dividends and was $525 which was recorded on the grant date as stock based compensation.  The value assigned to the voting rights was derived from a model utilizing control premiums to value the voting control of the preferred stock and was $83,000 which was recorded on the grant date as stock based compensation.  On December 30, 2016 the Articles of Incorporation were amended to increase the authorized preferred shares to 150,000.

On July 25, 2017, the Articles of Incorporation were amended to increase the voting rights of preferred shares to 100,000 votes per share. The Series A share amendments valued according to the additional voting rights and dividend rights assigned. The value assigned to the dividend rights was derived from a model utilizing future economic value of the dividends and was $0 which was recorded on the grant date as stock based compensation.  The value assigned to the voting rights was derived from a model utilizing control premiums to value the voting control of the preferred stock and was $54,000 which was recorded on the grant date as stock based compensation.

On December 4, 2017, the Company granted 50,000 additional Series A Preferred Stock shares to Robert Cashman, a related party.  The value assigned to the new shares was derived from a model utilizing control premiums to value the voting control of the preferred stock and was $1,000 which was recorded on the grant date as stock based compensation.

15 

Share Transactions

2020

There were no share transactions in 2020

2019

There were no share transactions in 2019

Stock Based Compensation

We have accounted for stock-based compensation under the provisions of FASB Accounting Standards codification (ASC) 718-10-55.  (Prior authoritative literature:  FASB Statement 123 (R), Share-based payment.)  This statement requires us to record any expense associated with the fair value of stock-based compensation.  Determining fair value requires input of highly subjective assumptions, including the expected price volatility.  Changes in these assumptions can materially affect the fair value estimate. As of November 30, 2019, the company has not granted any stock options.

 NOTE 4 – DEBT TRANSACTIONS

Convertible Notes Payable – Related Party

R.L. Cashman

On April 17, 2017, the Company issued a convertible note to Robert Cashman (a related party) for $12,500 of cash consideration.  The note bears interest at 10%, matures on April 17, 2018, and is convertible into common stock at 50% of the average bid price of the stock during the 30 days prior to the conversion. The Company recorded a debt discount equal to $12,500 due to this conversion feature and amortized $4,658 during the year ended August 31, 2017, with a remaining debt discount of $7,842 amortized during the year ended August 31, 2018.  The note was repaid during the fiscal year ended August 31, 2018.

The Company evaluated the convertible note and determined that the shares issuable pursuant to the conversion option were determinate due to the conversion price floor and, as such, does not constitute a derivative liability as the Company has sufficient authorized shares and a conversion floor of $0.0005. In the event that the authorized shares were not sufficient, the Company has obtained authorization from a majority of shareholders such that the appropriate number of shares will be available or issuable for settlement to occur.

16 

Convertible Notes Payable – Third Party

JMJ Financial Group

On April 28, 2017, the Company issued a convertible note to JMJ Financial Group for $55,000 of cash consideration.  The note bears interest at 12%, matures on April 28, 2018, and is convertible into common stock at 50% of the lowest 3 closing market prices of the previous 20 trading days prior to conversion. The Company recorded a debt discount equal to $37,080 due to this conversion feature. The Company also recorded a $6,000 and $11,920 debt discounts due to accrued interest and origination fees required by the agreement to be accrued at the beginning of the note. The note had accrued interest of $7,222 as of November 30, 2019 and August 31, 2019 respectively. The debt discounts had a balance at November 30, 2019 and August 31, 2019 of $0. The Company recorded debt discount amortization expense of $0 during the three months ended November 30, 2019 and during the year ended August 31, 2019. The Company converted $31,570 of principal and $12,222 of interest into shares during the year ended August 31, 2018.   This note is currently in default.

The Company evaluated the convertible note and determined that the shares issuable pursuant to the conversion option were determinate due to the conversion price floor and, as such, does not constitute a derivative liability as the Company has sufficient authorized shares and a conversion floor of $0.00005. In the event that the authorized shares were not sufficient, the Company has obtained authorization from a majority of shareholders such that the appropriate number of shares will be available or issuable for settlement to occur.

Tangiers Capital Group

On November 10, 2017, Service Team Inc issued a 12% Convertible Promissory Note payable to Tangiers Investment Group LLC (the "Investor") in the principal amount of $23,000. The Note, which is due on November 10, 2018, was funded by the Investor in the sum of $20,000 and $3,000 was retained by the Investor through an original issue discount or "OID" for due diligence and legal expense related to this transaction. The Note is convertible into shares of the Registrant's common stock, par value $0.001, at a conversion price of 50% of the lowest trading price of the Company's common stock during the 25 consecutive trading days prior to the date on which Holder elects to convert all or part of the Note.  The Company recorded a $20,000 discount due to the beneficial conversion feature.  During the year ended August 31, 2019, $18,526 of discount amortization was recorded, to result in a remaining debt discount balance of $0 as of August 31, 2019.  Accrued interest at August 31, 2019 and November 30, 2019 was $11,186 and $11,703, respectively.  This note is currently in default.

The Company evaluated the convertible note and determined that the shares issuable pursuant to the conversion option were determinate due to the conversion price floor and, as such, does not constitute a derivative liability as the Company has sufficient authorized shares and a conversion floor of $0.00005. In the event that the authorized shares were not sufficient, the Company has obtained authorization from a majority of shareholders such that the appropriate number of shares will be available or issuable for settlement to occur.

17 

On February 27, 2018, Service Team Inc issued a 12% Convertible Promissory Note payable to Tangiers Investment Group LLC (the "Investor") in the principal amount of $23,000. The Note, which is due on February 27, 2019, was funded by the Investor in the sum of $20,000 and $3,000 was retained by the Investor through an original issue discount or "OID" for due diligence and legal expense related to this transaction. The Note is convertible into shares of the Registrant's common stock, par value $0.001, at a conversion price of 50% of the lowest trading price of the Company's common stock during the 25 consecutive trading days prior to the date on which Holder elects to convert all or part of the Note.  The Company recorded a $20,000 discount due to the beneficial conversion feature and a $3,000 discount due to the original issue discount. During the year ended August 31, 2019, the Company amortized $11,342 of the debt discount leaving a remaining balance of $0 as of August 31, 2019.  Accrued interest at August 31, 2019 and November 30, 2019 was $19,237 and $20,502, respectively.

The Company evaluated the convertible note and determined that the shares issuable pursuant to the conversion option were determinate due to the conversion price floor and, as such, does not constitute a derivative liability as the Company has sufficient authorized shares and a conversion floor of $0.00005. In the event that the authorized shares were not sufficient, the Company has obtained authorization from a majority of shareholders such that the appropriate number of shares will be available or issuable for settlement to occur.

Iconic Holdings LLC

On July 10, 2017, the Company issued a convertible note to Iconic Holdings of $34,993 for consideration of certain machine tools.  The note bears interest at 10%, matures on July 10, 2018, and is convertible into common stock at 50% of the lowest 3 closing market prices of the previous 20 trading days prior to conversion. The Company recorded a debt discount equal to $31,812 due to this conversion feature. The Company also recorded a $3,181 debt discount due to issuance fees. The note had accrued interest of $39,221 as of November 30, 2019 and $37,471 as of August 31, 2019.  The debt discounts had a balance of $0 as of August 31, 2019.  This note is currently in default.

The Company evaluated the convertible note and determined that the shares issuable pursuant to the conversion option were determinate due to the conversion price floor and, as such, does not constitute a derivative liability as the Company has sufficient authorized shares and a conversion floor of $0.00005. In the event that the authorized shares were not sufficient, the Company has obtained authorization from a majority of shareholders such that the appropriate number of shares will be available or issuable for settlement to occur.

18 

Crown Bridge Partners, LLC.

On June 12, 2017, the Company issued a convertible note to Crown Bridge Partners, LLC. for $63,750 of cash consideration.  The note bears interest at 6%, matures on June 12, 2018, and is convertible into common stock at 55% of the lowest 3 closing market prices of the previous 20 trading days prior to conversion. The Company recorded a debt discount equal to $52,600 due to this conversion feature. The Company also recorded a $11,150 debt discount due to issuance fees. The note had accrued interest of $2,180 as of November 30, 2019 and $1,817 as of August 31, 2019.   The debt discounts had a balance at August 31, 2019 of $0.   This note is currently in default.

The Company evaluated the convertible note and determined that the shares issuable pursuant to the conversion option were determinate due to the conversion price floor and, as such, does not constitute a derivative liability as the Company has sufficient authorized shares and a conversion floor of $0.00005. In the event that the authorized shares were not sufficient, the Company has obtained authorization from a majority of shareholders such that the appropriate number of shares will be available or issuable for settlement to occur.

Crossover Capital Fund, LLC

On July 24, 2017, the Company issued a convertible note to Crossover Capital Fund, LLC for $40,000 of cash consideration.  The note bears interest at 10%, matures on July 24, 2018, and is convertible into common stock at 50% of the lowest 3 closing market prices of the previous 20 trading days prior to conversion. The Company recorded a debt discount equal to $40,000 due to this conversion feature. The note had accrued interest of $9,428 as of November 30, 2019 and $7,917 at August 31, 2019.   The debt discounts had a balance of $0 at August 31, 2018.     This note is currently in default.

The Company evaluated the convertible note and determined that the shares issuable pursuant to the conversion option were determinate due to the conversion price floor and, as such, does not constitute a derivative liability as the Company has sufficient authorized shares and a conversion floor of $0.00005. In the event that the authorized shares were not sufficient, the Company has obtained authorization from a majority of shareholders such that the appropriate number of shares will be available or issuable for settlement to occur.

Promissory Notes Payable – Third Party

IOU Financial

On March 30, 2018, the Company issued a promissory note to IOU Financial for $120,000 of cash consideration.  The note bears interest at 32% and matures on March 30, 2019. The Company recorded a debt discount equal to $38,630 due to the unpaid interest which was added to the principal balance to be repaid during the 12 month note.  During the year ended August 31, 2018, the company amortized $16,299 of the debt discount into interest expense leaving a remaining total debt discount on the note of $22,331 as of August 31, 2018.  During the year ended August 31, 2018, the Company repaid $69,206 in principal on the note in cash leaving a balance on the note of $73,200 owed as of August 31, 2018.  During the year ended August 31, 2019, the company amortized $22,331 of the debt discount into interest expense leaving a remaining total debt discount on the note of $0 as of August 31, 2019.  During the year ended August 31, 2019, the Company repaid $89,424 in principal on the note in cash leaving a balance on the note of $0 owed as of August 31, 2019.

19 

On January 22, 2019, the Company issued a promissory note to IOU Financial for $75,000 of cash consideration.  The note bears interest at 32%, matures on October 23, 2019.  The Company recorded a debt discount equal to $16,954 due to the unpaid interest which was added to the principal balance to be repaid during the 9 month note. During the year ended August 31, 2018, the company amortized $35,836 of the debt discount into interest expense leaving a remaining total debt discount on the note of $0 as of August 31, 2018.  The proceeds of the loan were used to pay $27,244 to IOU Financial to pay the note dated March 30, 2018 in full.  And the remaining amount $47,776 was added to working capital.  During the period ended August 31, 2019, the Company repaid $74,400 in principal on the note in cash leaving a balance on the note of $16,999 owed as of August 31, 2019. The note had interest of $7,917 as of August 31, 2019. This note was paid in full on December 12, 2019.

NOTE 5- RELATED PARTY TRANSACTIONS

Preferred Stock Issued for Services

On July 25, 2017, the Articles of Incorporation were amended to increase the voting rights of preferred shares to 100,000 votes per share. The Series A share amendments valued according to the additional voting rights and dividend rights assigned. The value assigned to the dividend rights was derived from a model utilizing future economic value of the dividends and was $0 which was recorded on the grant date as stock-based compensation.  The value assigned to the voting rights was derived from a model utilizing control premiums to value the voting control of the preferred stock and was $54,000 which was recorded on the grant date as stock-based compensation.

On December 4, 2017, the Company granted 50,000 additional Series A Preferred Stock shares to Robert Cashman, a related party.  The value assigned to the new shares was derived from a model utilizing control premiums to value the voting control of the preferred stock and was $1,000 which was recorded on the grant date as stock-based compensation.
 

NOTE 6 – INCOME TAXES
 

The Company accounts for income taxes under standards issued by the FASB. Under those standards, deferred tax assets and liabilities are recognized for future tax benefits or consequences attributable to temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. 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. A valuation allowance is provided for significant deferred tax assets when it is more likely than not that such assets will not be realized through future operations.
 

No provision for federal income taxes has been recorded due to the net operating loss carry forwards totaling approximately $858,102 as of November 30, 2019, that will be offset against future taxable income.  The available net operating loss carry forwards will expire in various years through 2035. Future tax benefits which may arise as a result of these losses have not been recognized in these financial statements, as their realization is determined not likely to occur and accordingly, the Company has recorded a valuation allowance for the future tax loss carry forwards.

20 

The actual income tax provisions differ from the expected amounts calculated by applying the statutory income tax rate to the Company's loss before income taxes.  The components of these differences are as follows at November 30, 2019 and August 31, 2019:

	11/30/19			8/31/19
Net tax loss carry-forwards	$	858,102		$	844,216
Statutory rate		21	%		21	%
Expected tax recovery		180,201			177,285
Change in valuation allowance	$	(180,201	)	$	(177,285	)
Income tax provision		—			—
Components of deferred tax asset:
Non capital tax loss carry forwards		180,201			177,285
Less: valuation allowance	$	(180,201	)	$	(177,285	)
Net deferred tax asset		—			—

NOTE 7 – COMMITMENTS AND CONTINGENCIES

Litigation

None.
 

Operating Leases

Service Team Inc. leased a building at 1818 East Rosslynn Avenue, Fullerton, California 92834 effective October 1, 2015.  The lease is for a period of 72 months with an option to extend the lease for an additional 72 months.   The new facility is a 25,000 square foot concrete industrial building located on approximately two acres of land.  This new facility is approximately double the size of the prior facility.  Rent for the new facility is $10,000 per month for the first six months; and then $14,000 per month thereafter.  The Company is responsible for the property taxes and insurance on the building.  As of November 30, 2019, the deferred rent related to this lease was $7,333 and is included in accrued expenses.

NOTE 8 – SUBSEQUENT EVENTS

Except as noted below, management has evaluated subsequent events to the requirements of ASC 855, and there are currently no subsequent events to report.

On January 22, 2020 the company filed a Form 15 with the Securities and Exchange Commission.

21 

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations.

Overview of Our Company

Service Team Inc. (the "Company") was incorporated pursuant to the laws of the State of Nevada on June 6, 2011.  The Company was organized to comply with the warranty obligations of electronic devices manufactured by companies outside of the United States.  The business proved to be unprofitable and the Company eliminated its warranty and repair operations.  On June 5, 2013, Service Team Inc. acquired 25,000 common shares of Trade Leasing, Inc., representing 100% ownership, for 4,000,000 shares of its common stock; in addition, both entities are under common control.  Trade Leasing, Inc., a California corporation, was incorporated on November 1, 2011, and commenced business January 1, 2012.

Trade Leasing Inc dba Delta Stag Manufacturing is involved in the manufacture and repair of truck bodies.  The Company manufactures truck bodies that are attached to a truck chassis which consists of an engine, drive train, a frame with wheels, and in some cases, a cab.  The truck chassis is manufactured by third parties that are major automotive or truck companies.  These companies do not typically build specialized truck bodies.  The company is also involved in other products used by the trucking industry.   The company operates a complete manufacturing and repair facility in South Gate, California.  The facility manufactures both custom and standard production truck bodies in approximately 70 different models designed to fill the specialized demands of the user.   The vans are available for hauling dry freight or refrigerated freight.  The refrigerated vans are built with two to four inches of foam insulating that is sprayed in place for hauling refrigerated products such as meats, vegetables, flowers and similar products.  The Company installs different types of cooling systems in the trucks.  This varies from motor driven units installed outside the van body or refrigeration units driven off the engine of the truck.  Some refrigerated trucks use a system called "cold plate" where a large metal plate is cooled by power while the truck is parked.  The power is then unplugged and the truck will stay cool for many hours.  The Company's customers are auto dealers and users of trucks; such as dairies, food distributors and local delivery. The company has approximately 400 customers. One customer South Bay Ford represented more than 10% of sale in the last 12 months. The company is not dependent on a few major customers. Trade Leasing purchases raw materials from approximately 75 suppliers.  There are several hundred similar suppliers of comparable materials in the local area. Trade Leasing Inc. purchases refrigeration units from Thermoking Corporation a division of United Technologies and Carrier Corporation, a division of Ingersol Rand Corporation. The two companies represent more than 80% of the refrigeration unit market. There are several other manufactures of refrigeration units that represent a small part of the market. Trade Leasing Inc. employs 43 factory workers and four management personnel.  The management personnel make all of the sales and manage the factory. The company has all of the government licenses necessary to conduct its business. These include 9 different city, county and state licenses covering vehicle transportation, air quality, hazard waste (Paint), land or building use, and sales tax.

22 

Liquidity and Capital Resources

As of November 30, 2019, we had assets of $568,872 including current assets of $399,438.   We have accounts payable of $109,162, and convertible notes payable – third party of $136,632.   Accrued interest and expenses of $152,908.    Accrued expenses are for work performed by employees during the organizational and operational stages of the Company. There is no firm date for which these are to be paid. It is to be repaid when we have funds available.  Since inception we have also raised $354,382 from the sale of our common stock.   We believe our ability to achieve commercial success and continued growth will be dependent upon our continued access to capital either through additional sale of our equity or cash generated from operations. We will seek to obtain additional working capital through the sale of our securities. We will attempt to obtain additional capital through bank lines of credit; however, we have no agreements or understandings with third parties at this time.

Results of Operations

Three Months Ended November 30, 2018 compared to the Three Months Ended November 30, 2017

Sales during the three month period ended November 30, 2018, were $993,889 compared to $994,625 for the three month period ending November 30, 2019.   Our cost of sales for the three month period ending November 30, 2018 was $717,017, compared to $824,002 for the three month period ending November 30, 2019. Our operating expenses for the three month period ending November 30, 2018, were $130,666 compared to $178,706 for the three month period ending November 30, 2019.  We had a net income during the three month period ending November 30, 2018, of $113,526; and a net loss of $(17,165) during the three month period ending November 30, 2019.

Item 3.  Quantitative and Qualitative Disclosures About Market Risk.

Not Applicable

Item 4.  Controls and Procedures.

Evaluation of Disclosure Controls and Procedures

We carried out an evaluation, under the supervision and with the participation of our management, including our principal executive officer, of the effectiveness of our disclosure controls and procedures (as defined in Exchange Act Rules 13a – 15(c) and 15d – 15(e)). Based upon that evaluation, our principal executive officer concluded that, as of the end of the period covered in this report, our disclosure controls and procedures were not effective to ensure that information required to be disclosed in reports filed under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the required time periods and is accumulated and communicated to our management, including our principal executive officer, as appropriate to allow timely decisions regarding required disclosure.

23 

Inherent Limitations of Internal Controls

Our Principal Executive Officer does not expect that our disclosure controls or internal controls will prevent all error and all fraud. Although our disclosure controls and procedures were designed to provide reasonable assurance of achieving their objectives, a control system, no matter how well conceived and operated, can provide only reasonable, not absolute assurance that the objectives of the system are met. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within the Company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty, and that breakdowns can occur because of simple error or mistake. Additionally, controls can be circumvented if there exists in an individual a desire to do so. There can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions.

Changes in Internal Control over Financial Reporting

There were no changes in our internal control over financial reporting, other than those stated above, during our most recent quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II—OTHER INFORMATION

Item 1.  Legal Proceedings.

None

Item 1A. Risk Factors.

Not applicable.

Item 2.  Unregistered Sales of Equity Securities and Use of Proceeds.

None.

Item 3. Defaults Upon Senior Securities.

None.

Item 4.  Mine Safety Disclosures.

Not applicable.

24 

Item 5. Other Information.

None

Item 6. Exhibits.

(a)   The following exhibits are filed with this report.

31.1  Certification by Chief Executive Officer pursuant to Sarbanes Oxley Section 302.

31.2  Certification by Chief Financial Officer pursuant to Sarbanes Oxley Section 302.

32.l  Certification by Chief Executive Officer pursuant to 18 U.S.C. Section 1350.

32.2  Certification by Chief Financial Officer pursuant to 18 U.S.C. Section 1350.

101   Interactive Data Files

SIGNATURES

 Pursuant to the requirements of Section 13 or 15(d) of the Exchange Act, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Date:  January 22, 2020

SIGNATURE	TITLE	DATE
/s/ Karen J. Fowler	President, Chief Executive Officer	January 22, 2020
	(principal executive officer)
/s/ Karen J. Fowler	Secretary, Chief Financial Officer, Chief Accounting Officer	January 22, 2020

25 

EX-31.1

Exhibit 31.1

CERTIFICATION PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I,  Karent J. Fowler certify that:

1. I have reviewed this report on Form 10-Q of Service Team Inc.;

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

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

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

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

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

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation: and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

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

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

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

Date  January 22. 2020	By:	/s/ Karen J. Fowler
		Karen J. Fowler
		Chief Executive Officer and President Principal Executive Officer

EX-31.2

Exhibit 31.2

CERTIFICATION PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I,  Karen J. Fowler certify that:

1. I have reviewed this report on Form 10-Q of Service Team Inc..;

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

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

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

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

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

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation: and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

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

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

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

Date January 22, 2020	By:	/s/ Karen J. Fowler
		Karen J. Fowler
		Chief Financial Officer Principal Financial and Accounting Officer

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

I, Karen J. Fowler, Chief Executive Officer, of Service Team Inc., a Nevada corporation (the "Company"), certify, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The report on Form 10-Q of Service Team Inc. (the "Registrant") for the period ended November 30, 2019 (the "Report") which this statement accompanies fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

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

Date  January 22, 2020	By:	/s/ Karen J. Fowler
		Karen J. Fowler
		Chief Executive Officer and President Principal Executive Officer

EX-32.2

Exhibit 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002 

I, Karen J. Fowler, Chief Financial Officer and Principal Financial and Accounting Officer of Service Team Inc.,  a Nevada corporation (the "Company"), certify, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The report on Form 10-Q of Service Team Inc. (the "Registrant") for the period ended November 30, 2019 (the "Report") which this statement accompanies fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

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

Date January 22, 2020	By:	/s/ Karen J. Fowler
		Karen J. Fowler
		Chief Financial Officer Principal Financial and Accounting Officer

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DEBT TRANSACTIONS (Details Narrative) - USD ($)				1 Months Ended						3 Months Ended		7 Months Ended	12 Months Ended
	Nov. 10, 2017	Jul. 10, 2017	Jun. 12, 2017	Jan. 22, 2019	Mar. 30, 2018	Feb. 27, 2018	Jul. 24, 2017	Apr. 28, 2017	Apr. 17, 2017	Nov. 30, 2019	Nov. 30, 2018	Aug. 31, 2019	Aug. 31, 2019	Aug. 30, 2019	Aug. 31, 2018	Aug. 31, 2017	Aug. 30, 2017
Amortization of debt										$ 3,279	$ 19,881
R.L. Cashman
Shares Issued for Note Conversion									$ 12,500
Interest rate									10.00%
Maturity date									Apr. 17, 2018
Debt discount due to conversion feature																$ 12,500
Amortization of debt															$ 7,842	$ 4,658
Conversion price									$ 0.0005
JMJ Financial
Shares Issued for Note Conversion								$ 55,000
Interest rate								12.00%
Maturity date								Apr. 28, 2018
Debt discount due to conversion feature																	$ 37,080
Amortization of debt										0				$ 0
Debt discount										0		$ 0	$ 0
Conversion price								$ 0.00005
Accrued interest										7,222		7,222	7,222
JMJ Financial | Principal
Shares Issued for Note Conversion															31,570
JMJ Financial | Interest
Shares Issued for Note Conversion															12,222
Tangiers Capital Group | Convertible note One
Shares Issued for Note Conversion	$ 23,000
Interest rate	12.00%
Maturity date	Nov. 10, 2018
Debt discount due to conversion feature										20,000
Amortization of debt													18,526
Debt discount												0	0
Conversion price	$ 0.00005
Accrued interest										11,703		11,186	11,186
Tangiers Capital Group | Convertible note Two
Shares Issued for Note Conversion						$ 23,000
Interest rate						12.00%
Maturity date						Feb. 27, 2019
Debt discount due to conversion feature											20,000
Amortization of debt										11,342
Debt discount												0	0
Conversion price						$ 0.00005
Accrued interest										19,237		20,502	20,502
Debt discount due to original issue discount											3,000
Iconic Holdings LLC
Shares Issued for Note Conversion		$ 34,993
Interest rate		10.00%
Maturity date		Jul. 10, 2018
Debt discount due to conversion feature										31,812
Debt discount												0	0
Conversion price		$ 0.00005
Accrued interest										39,221		37,471	37,471
Debt discount on issuance costs										3,181
Crown Bridge Partners LLC | Convertible note One
Shares Issued for Note Conversion			$ 63,750
Interest rate			6.00%
Maturity date			Jun. 12, 2018
Debt discount due to conversion feature										52,600
Debt discount												0	0
Conversion price			$ 0.00005
Accrued interest										2,180		1,817	1,817
Debt discount on issuance costs										11,150
Crossover Capital LLC | Convertible note One
Shares Issued for Note Conversion							$ 40,000
Interest rate							10.00%
Maturity date							Jul. 24, 2018
Debt discount due to conversion feature											$ 40,000
Debt discount															0
Accrued interest										9,428		7,917	7,917
Crossover Capital LLC | Convertible note Two
Conversion price							$ 0.00005
IOU Financial | Convertible note One
Shares Issued for Note Conversion					$ 120,000
Interest rate					32.00%
Maturity date					Mar. 30, 2019
Debt discount due to conversion feature															38,630
Amortization of debt												22,331			16,299
Debt discount												0	0		22,331
Loan outstanding												0	0		73,200
IOU Financial | Convertible note Two
Shares Issued for Note Conversion				$ 75,000
Interest rate				32.00%
Maturity date				Oct. 23, 2019
Debt discount due to conversion feature															16,954
Amortization of debt															35,836
Debt discount												0	0
Accrued interest												7,917	7,917
Loan outstanding												$ 16,999	16,999
Proceeds from loan										27,244
Working capital										$ 47,776
IOU Financial | Principal | Convertible note One
Shares Issued for Note Conversion													89,424		$ 69,206
IOU Financial | Principal | Convertible note Two
Shares Issued for Note Conversion													$ 74,400

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 1)	Nov. 30, 2019 USD ($)
Accounting Policies [Abstract]
2020	$ 126,000
2021	168,000
2022	14,000
Total	$ 308,000

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CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) - USD ($)	3 Months Ended
	Nov. 30, 2019	Nov. 30, 2018
CASH FLOWS FROM OPERATING ACTIVITIES
Net Income (Loss)	$ (17,165)	$ 113,526
Adjustments to reconcile net income (loss) with cash provided by (used in) operations:
Debt discount amortization	3,279	19,881
Depreciation	4,017	4,206
CHANGE IN OPERATING ASSETS AND LIABILITIES
Accounts receivable	(32,019)	(28,815)
Accrued expenses	4,521	5,760
Accounts payable	26,598	17,805
Net Cash Provided by (Used in) Operating Activities	(10,769)	132,363
CASH FLOWS FROM INVESTING ACTIVITIES
Cash paid for purchase of fixed assets	(1,715)	0
Net Cash Used in Investing Activities	(1,715)	0
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from convertible debt - third party	0	0
Payments on promissory notes - third party	(16,999)	(39,656)
Net Cash Provided By (Used In) Financing Activities	(16,999)	(39,656)
Net Increase (Decrease) In Cash and Cash Equivalents	(29,483)	92,707
Cash at Beginning of Period	52,636	48,855
Cash at End of Period	23,153	141,562
Supplemental Disclosures
Interest Paid	413	0
Taxes Paid	$ 0	$ 0

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INCOME TAXES (Details Narratives) - USD ($)	3 Months Ended
	Nov. 30, 2019	Nov. 30, 2018
Income Tax Disclosure [Abstract]
Net operating loss carry forwards	$ (858,102)	$ (844,216)
Expiration date	Dec. 31, 2035

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CONSOLIDATED BALANCE SHEETS (UNAUDITED) - USD ($)	Nov. 30, 2019	Aug. 31, 2019
ASSETS
Cash	$ 23,153	$ 52,636
Accounts receivable, net	376,285	344,266
Total Current Assets	399,438	396,902
Property and equipment, net	155,434	157,736
Prepaid expenses - non-current	14,000	14,000
TOTAL ASSETS	568,872	568,638
LIABILITIES & SHAREHOLDERS' EQUITY
Accounts payable	109,162	82,564
Loan - employee	1,300	1,300
Convertible note payable, net - currently in default	136,632	140,232
Promissory note payable, net	0	10,120
Accrued expenses	62,652	63,521
Accrued interest	90,256	84,866
TOTAL LIABILITIES	400,002	382,603
SHAREHOLDERS' EQUITY
Common stock, $0.001 par value, 20,000,000,000 authorized, and 8,852,873,544 issued and outstanding as of November 30, 2019 and 8,852,873,544 issued and outstanding as of August 31, 2019 respectively.	8,852,874	8,852,874
Preferred stock - Series A, $0.001 par value, 150,000 authorized, 150,000 and 150,000 issued and outstanding as of November 30, 2019 and August 31, 2019, respectively.	150	150
Additional paid in capital	(5,611,302)	(5,611,302)
Stock payable	0	0
Accumulated deficit	(3,072,852)	(3,055,687)
TOTAL SHAREHOLDERS' EQUITY	168,870	186,035
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY	$ 568,872	$ 568,638

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)

3 Months Ended

Nov. 30, 2019

Accounting Policies [Abstract]

Schedule of Net property and equipment

Net property and equipment were as follows at November 30, 2019 and August 31, 2019: 

	11-30-19		8-31-19
Equipment	$	369,673	$	367,958
Vehicles		15,000		15,000
Furniture		24,000		24,000
Leasehold improvements		52,826		52,826
Subtotal		461,499		459,784
Less: accumulated depreciation		306,065		(302,048	)
Total Fixed Assets, Net	$	155,434	$	157,736

Schedule of Future Minimum Rental Payments for Operating Leases

The table below discloses the Company’s future minimum lease payment obligations as of November 30, 2019.

2020	$	126,000
2021		168,000
2022		14,000
TOTAL:	$	308,000

Schedule of fair value of assets and liabilities measured on recurring basis

The following table presents assets and liabilities that were measured and recognized at fair value as of November 30, 2019 on a recurring basis:

Description	Level 1		Level 2		Level 3		Total Realized Loss
Convertible Note Payable-net	$	0	$	—	$	—	$	—
Convertible Note Payable-net, in default		136,632		—		—		—
Total	$	136,632		—		—		—

The following table presents assets and liabilities that were measured and recognized at fair value as of August 31, 2019 on a recurring basis: 

Description	Level 1		Level 2		Level 3		Total Realized Loss
Convertible Note Payable-net	$	140,232	$	—	$	—	$	—
Total	$	140,232		—		—		—

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INCOME TAXES

3 Months Ended

Nov. 30, 2019

Income Tax Disclosure [Abstract]

INCOME TAXES

NOTE 6 – INCOME TAXES
 

The Company accounts for income taxes under standards issued by the FASB. Under those standards, deferred tax assets and liabilities are recognized for future tax benefits or consequences attributable to temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. 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. A valuation allowance is provided for significant deferred tax assets when it is more likely than not that such assets will not be realized through future operations.
 

No provision for federal income taxes has been recorded due to the net operating loss carry forwards totaling approximately $858,102 as of November 30, 2019, that will be offset against future taxable income.  The available net operating loss carry forwards will expire in various years through 2035. Future tax benefits which may arise as a result of these losses have not been recognized in these financial statements, as their realization is determined not likely to occur and accordingly, the Company has recorded a valuation allowance for the future tax loss carry forwards.

The actual income tax provisions differ from the expected amounts calculated by applying the statutory income tax rate to the Company's loss before income taxes.  The components of these differences are as follows at November 30, 2019 and August 31, 2019:

	11/30/19			8/31/19
Net tax loss carry-forwards	$	858,102		$	844,216
Statutory rate		21	%		21	%
Expected tax recovery		180,201			177,285
Change in valuation allowance	$	(180,201	)	$	(177,285	)
Income tax provision		—			—
Components of deferred tax asset:
Non capital tax loss carry forwards		180,201			177,285
Less: valuation allowance	$	(180,201	)	$	(177,285
Net deferred tax asset		—			—

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INCOME TAXES (Tables)

3 Months Ended

Nov. 30, 2019

Income Tax Disclosure [Abstract]

Schedule of Income Tax Provions and Components

The components of these differences are as follows at November 30, 2019 and August 31, 2019:

	11/30/19			8/31/19
Net tax loss carry-forwards	$	858,102		$	844,216
Statutory rate		21	%		21	%
Expected tax recovery		180,201			177,285
Change in valuation allowance	$	(180,201	)	$	(177,285	)
Income tax provision		—			—
Components of deferred tax asset:
Non capital tax loss carry forwards		180,201			177,285
Less: valuation allowance	$	(180,201	)	$	(177,285
Net deferred tax asset		—			—

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COMMITMENTS AND CONTINGENCIES

3 Months Ended

Nov. 30, 2019

Commitments and Contingencies Disclosure [Abstract]

COMMITMENTS AND CONTINGENCIES

NOTE 7 – COMMITMENTS AND CONTINGENCIES

Litigation

None.
 

Operating Leases

Service Team Inc. leased a building at 1818 East Rosslynn Avenue, Fullerton, California 92834 effective October 1, 2015.  The lease is for a period of 72 months with an option to extend the lease for an additional 72 months.   The new facility is a 25,000 square foot concrete industrial building located on approximately two acres of land.  This new facility is approximately double the size of the prior facility.  Rent for the new facility is $10,000 per month for the first six months; and then $14,000 per month thereafter.  The Company is responsible for the property taxes and insurance on the building.  As of November 30, 2019, the deferred rent related to this lease was $7,333 and is included in accrued expenses.

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ORGANIZATION

3 Months Ended

Nov. 30, 2019

Health Care Organizations [Abstract]

ORGANIZATION

NOTE 1 - ORGANIZATION

Organization

Service Team Inc. (the "Company") was incorporated pursuant to the laws of the State of Nevada on June 6, 2011.  The Company was organized to comply with the warranty obligations of electronic devices manufactured by companies outside of the United States.  The business proved to be unprofitable and the Company reduced its warranty and repair operations.  On June 5, 2013, Service Team Inc. acquired Trade Leasing, Inc. for 4,000,000 shares of its common stock, a commonly held company.  Trade Leasing, Inc., a California corporation, was incorporated on November 1, 2011, and commenced business January 1, 2013.  Trade Leasing, Inc. is principally involved in the manufacturing, maintenance and repair of truck bodies.   On September l, 2018, Service Team Inc. changed its state of domicile from the state of Nevada to the state of Wyoming.    

The Company has established a fiscal year end of August 31.

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COMMITMENTS AND CONTINGENCIES (Details Narrative)	3 Months Ended
	Nov. 30, 2019 USD ($)
Commitments and Contingencies Disclosure [Abstract]
Lease of California office premises per month	$ 10,000
Deferred rent related to operating lease	$ 7,333

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CONSOLIDATED BALANCE SHEETS (UNAUDITED) (Parenthetical) - $ / shares	Nov. 30, 2019	Aug. 31, 2019
Statement of Financial Position [Abstract]
Preferred stock series A, par or stated value	$ 0.001	$ 0.001
Preferred stock series A, shares authorized	150,000	150,000
Preferred stock series A, shares issued	150,000	150,000
Preferred stock series A, shares oustanding	150,000	150,000
Common Stock, par or stated value	$ 0.001	$ 0.001
Common Stock, shares authorized	20,000,000,000	20,000,000,000
Common Stock, shares issued	8,852,873,544	8,852,873,544
Common Stock, shares outstanding	8,852,873,544	8,852,873,544

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RELATED PARTY TRANSACTIONS (Details Narrative) - USD ($)		1 Months Ended
	Dec. 04, 2017	Jul. 25, 2017
Stock-based compensation		$ 54,000
R.L. Cashman
Stock-based compensation	$ 1,000
Stock granted	50,000

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 2) - USD ($)	3 Months Ended
	Nov. 30, 2019	Nov. 30, 2018	Aug. 31, 2019
Total Realized Loss	$ 0	$ 0
Level 1 [Member] | Fair Value, Measurements, Recurring [Member]
Convertible notes payable, net	0		$ 140,232
Convertible Note Payable, net - in default	136,632
Total	136,632		140,232
Level 2 [Member] | Fair Value, Measurements, Recurring [Member]
Convertible notes payable, net	0		0
Total	0		0
Level 3 [Member] | Fair Value, Measurements, Recurring [Member]
Convertible notes payable, net	0		0
Total	$ 0		$ 0

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)

3 Months Ended

Nov. 30, 2019

Accounting Policies [Abstract]

Basis of Presentation

Basis of Presentation

The consolidated financial statements presented in this report are the combined financial reports of Trade Leasing, Inc. and Service Team Inc. 

The Company maintains its accounting records on an accrual basis in accordance with generally accepted accounting principles in the United States of America (U.S. GAAP).

The consolidated financial statements present the Balance Sheet, Statements of Operations, Shareholders' Equity and Cash Flows of the Company. These consolidated financial statements are presented in United States dollars. The accompanying audited, consolidated financial statements have been prepared in accordance with the instructions to Form 10-Q.  All adjustments which are, in the opinion of management, necessary for a fair presentation of the results of operations for the interim periods have been made and are of a recurring nature unless otherwise disclosed herein.

Principles of Consolidation

Principles of Consolidation

The accompanying consolidated financial statements include the accounts of Service Team Inc. and Trade Leasing, Inc. both of which are under common control and ownership. The consolidated financial statements herein contain the operations of the wholly-owned subsidiaries listed above. All significant inter-company transactions have been eliminated in the preparation of these financial statements. 

Use of Estimates

Use of Estimates

The preparation of the consolidated financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, and disclosure of contingent liabilities at the date of the financial statements and the reported amounts of expenses during the reporting period.  Actual results could differ from those estimates. 

Going Concern

Going Concern

The Company's financial statements are prepared using the accrual method of accounting in accordance with accounting principles generally accepted in the United States of America, and have been prepared on a going concern basis, which contemplates the realization of assets and the settlement of liabilities in the normal course of business. The Company has an accumulated deficit as of November 30, 2019 of $3,072,852 and is dependent on raising capital through placement of our common stock in order to implement its business plan. There can be no assurance that the Company will be successful in order to continue as a going concern. The Company is funding its initial operations by issuing common shares and debt.  We cannot be certain that capital will be provided when it is required.

Cash and Equivalents

Cash and Equivalents

Cash and equivalents include investments with initial maturities of three months or less. The Company maintains its cash balances at credit-worthy financial institutions that are insured by the Federal Deposit Insurance Corporation ("FDIC") up to $250,000. There were no cash equivalents at November 30, 2019, or August 31, 2019.

Concentration of Credit Risk

Concentration of Credit Risk

Financial instruments and related items, which potentially subject the Company to concentrations of credit risk, are cash and cash equivalents. The Company places its cash and temporary cash investments with credit quality institutions. At times, such investments may be in excess of FDIC insurance limits.

Accounts Receivable

Accounts Receivable

All accounts receivable are due thirty (30) days from the date billed. If the funds are not received within thirty (30) days the customer is contacted to arrange payment. The Company uses the allowance method to account for uncollectable accounts receivable. Whilst management is confident that its customers will settle their debts, it has recorded an allowance for doubtful accounts in amount of $14,310 as of November 30, 2019 and August 31, 2019

Accounts Receivable and Revenue Concentrations

Accounts Receivable and Revenue Concentrations

The company has approximately 400 customers. One customer South Bay Ford represented more than 10% of sale in the last 12 months. The company is not dependent on a few major customers.

Inventory

Inventory

The Company does not own inventory, materials are purchased as needed from local suppliers; therefore, there was no additional inventory on hand at November 30, 2019 or August 31, 2019.

Property and Equipment

Property and Equipment

Equipment, vehicles and furniture, which are recorded at cost, consist primarily of fabrication equipment and are depreciated using the straight-line method over the estimated useful lives of the related assets (generally 15 years or less). Costs incurred for maintenance and repairs are expensed as incurred and expenditures for major replacements and improvements are capitalized and depreciated over their estimated remaining useful lives. There was $4,017 and $4,206 of depreciation expense during the three months ended November 30, 2019 and 2018, respectively. 

 Net property and equipment were as follows at November 30, 2019 and August 31, 2019: 

	11-30-19		8-31-19
Equipment	$	369,673	$	367,958
Vehicles		15,000		15,000
Furniture		24,000		24,000
Leasehold improvements		52,826		52,826
Subtotal		461,499		459,784
Less: accumulated depreciation		306,065		(302,048	)
Total Fixed Assets, Net	$	155,434	$	157,736

Lease Commitments

Lease Commitments

Service Team Inc. leases facilities at 1818 Rosslynn Avenue, Fullerton, California, to manufacture its products.   The facility is leased for six and one half years at a price of $10,000 per month, for the first six months; and, $14,000 per month thereafter.  Service Team Inc pays for the fire insurance and property taxes on the building estimated to be approximately $2,000 per month. The location consists of three acres of land and one building of approximately 30,000 square feet.   As of November 30, 2019, the deferred rent related to this lease was $7,333 and is included in accrued expenses.

The table below discloses the Company’s future minimum lease payment obligations as of November 30, 2019.

2020	$	126,000
2021		168,000
2022		14,000
TOTAL:	$	308,000

Beneficial Conversion Features

Beneficial Conversion Features

From time to time, the Company may issue convertible notes that may contain an imbedded beneficial conversion feature. A beneficial conversion feature exists on the date a convertible note is issued when the fair value of the underlying common stock to which the note is convertible into is in excess of the remaining unallocated proceeds of the note after first considering the allocation of a portion of the note proceeds to the fair value of warrants, if related warrants have been granted. The intrinsic value of the beneficial conversion feature is recorded as a debt discount with a corresponding amount to additional paid in capital. The debt discount is amortized to interest expense over the life of the note using the effective interest method.

Fair Value of Financial Instruments

Fair Value of Financial Instruments

The Company adopted Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) 820 on June 6, 2011. Under this FASB, fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (an exit price). The standard outlines a valuation framework and creates a fair value hierarchy in order to increase the consistency and comparability of fair value measurements and the related disclosures. Under GAAP, certain assets and liabilities must be measured at fair value, and FASB ASC 820-10-50 details the disclosures that are required for items measured at fair value.

 The Company has various financial instruments that must be measured under the new fair value standard including: cash, convertible notes payable, accrued expenses, promissory notes payable, accounts receivable and accounts payable. The Company's financial assets and liabilities are measured using inputs from the three levels of the fair value hierarchy. The three levels are as follows:   

Level 1 – Inputs are unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date.  The fair value of the Company's cash is based on quoted prices and therefore classified as Level 1. 

Level 2 - Inputs include quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability (e.g., interest rates, yield curves, etc.), and inputs that are derived principally from or corroborated by observable market data by correlation or other means (market corroborated inputs).

Level 3 - Unobservable inputs that reflect our assumptions about the assumptions that market participants would use in pricing the asset or liability.

Cash, accounts receivable, accounts payable, promissory notes, convertible notes and accrued expenses reported on the balance sheet are estimated by management to approximate fair market value due to their short-term nature.

 The following table presents assets and liabilities that were measured and recognized at fair value as of November 30, 2019 on a recurring basis:

Description	Level 1		Level 2		Level 3		Total Realized Loss
Convertible Note Payable-net	$	0	$	—	$	—	$	—
Convertible Note Payable-net, in default		136,632		—		—		—
Total	$	136,632		—		—		—

The following table presents assets and liabilities that were measured and recognized at fair value as of August 31, 2019 on a recurring basis: 

Description	Level 1		Level 2		Level 3		Total Realized Loss
Convertible Note Payable-net	$	140,232	$	—	$	—	$	—
Total	$	140,232		—		—		—

Income Taxes

Income Taxes

In assessing the realization of deferred tax assets, the Company considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. The Company considers the scheduled reversal of deferred tax liabilities, projected future taxable income, and tax planning strategies in making this assessment. Based on the level of historical operating results and the uncertainty of the economic conditions, the Company has recorded a full valuation allowance against its deferred tax assets at November 30, 2019 and August 31, 2019 where it cannot conclude that it is more likely than not that those assets will be realized.

Revenue Recognition

Revenue Recognition

Trade Leasing Inc dba Delta Stag Manufacturing

Service Team Inc, 100% owned subsidiary Trade Leasing Inc dba Delta Stag Manufacturing receives orders from customers to build or repair truck bodies. The company builds the requested product. At the completion of the product the truck is delivered to the customer.  If the customer accepts the product Trade Leasing Inc dba Delta Stag Manufacturing issues an invoice to the customer for the job. The invoice is entered into our accounting system and is recognized as revenue at that time.

In Trade Leasing Inc we use the completed contract method for truck bodies built, which typically have construction periods of 15 days or less. Contracts are considered complete when title has passed, the customer has accepted the product and we do not retain risks or rewards of ownership of the truck bodies. Losses are accrued if manufacturing costs are expected to exceed manufacturing contract revenue.  Manufacturing expenses are primarily composed of aluminum cost, which is the largest component of our raw materials cost and the cost of labor. 

On September 1, 2018, we adopted Accounting Standards Update No. 2014-09, Revenue from Contracts with Customers (Topic 606), which supersedes the revenue recognition requirements in Accounting Standards Codification (ASC) Topic 605, Revenue Recognition (Topic 605). Results for reporting periods beginning after September 1, 2018 are presented under Topic 606. The impact of adopting the new revenue standard was not material to our financial statements and there was no adjustment to beginning retained earnings on September 1, 2018.

Under Topic 606, revenue is recognized when control of the promised goods or services is transferred to our customers, in an amount that reflects the consideration we expect to be entitled to in exchange for those goods or services.

We determine revenue recognition through the following steps:

● identification of the contract, or contracts, with a customer;

● identification of the performance obligations in the contract;

● determination of the transaction price;

● allocation of the transaction price to the performance obligations in the contract; and

● recognition of revenue when, or as, we satisfy a performance obligation. 

Share Based Expenses

Share Based Expenses

The Company accounts for the issuance of equity instruments to acquire goods and/or services based on the fair value of the goods and services or the fair value of the equity instrument at the time of issuance, whichever is more readily determinable. The Company's accounting policy for equity instruments issued to consultants and vendors in exchange for goods and services follows the provisions of standards issued by the FASB. The measurement date for the fair value of the equity instruments issued is determined at the earlier of (i) the date at which a commitment for performance by the consultant or vendor is reached or (ii) the date at which the consultant or vendor's performance is complete. In the case of equity instruments issued to consultants, the fair value of the equity instrument is recognized over the term of the consulting agreement.

Stock Based Compensation

Stock Based Compensation

In December of 2004, the FASB issued a standard which applies to transactions in which an entity exchanges its equity instruments for goods or services and also applies to liabilities an entity may incur for goods or services that are based on the fair value of those equity instruments. For any unvested portion of previously issued and outstanding awards, compensation expense is required to be recorded based on the previously disclosed methodology and amounts. Prior periods presented are not required to be restated. We adopted the standard as of inception.  The Company has not issued any stock options to its Board of Directors and officers as compensation for their services.  If options are granted, they will be accounted for at a fair value as required by the FASB ASC 718.

Net Loss Per Share

Net Loss Per Share

The Company adopted the standard issued by the FASB, which requires presentation of basic earnings or loss per share and diluted earnings or loss per share. Basic income (loss) per share ("Basic EPS") is computed by dividing net income (loss) available to common stockholders by the weighted average number of common shares outstanding during the period. Diluted earnings per share ("Diluted EPS") are similarly calculated using the treasury stock method except that the denominator is increased to reflect the potential dilution that would occur if dilutive securities at the end of the applicable period were exercised.  During the three month period ended November 30, 2018, because the Company operations resulted in net income, therefore additional dilutive securities were included in the diluted EPS.   During the three month period ended November 30, 2019, there were net losses; therefore, no additional dilutive securities were included in the diluted EPS as that would be anti-dilutive to the resulting diluted earnings per share.

Recent Accounting Pronouncements

Recent Accounting Pronouncements

In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842): Accounting for Leases. This update requires that lessees recognize right-of-use assets and lease liabilities that are measured at the present value of the future lease payments at lease commencement date. The recognition, measurement, and presentation of expenses and cash flows arising from a lease by a lessee will largely remain unchanged and shall continue to depend on its classification as a finance or operating lease. The Company has performed a comprehensive review in order to determine what changes were required to support the adoption of this new standard. The Company will elect the optional transition method that allows for a cumulative-effect adjustment in the period of adoption and will not restate prior periods. Under the new guidance, the Company’s lease will continue to be classified as operating. During fiscal 2020, the Company will complete its implementation of its processes and policies to support the new lease accounting and reporting requirements. The adoption of this ASU is not expected to have a significant impact on our Consolidated Statements of Operations or Cash Flows.

In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606), to clarify the principles of recognizing revenue and create common revenue recognition guidance between U.S. GAAP and International Financial Reporting Standards. Under ASU 2014-09, revenue is recognized when a customer obtains control of promised goods or services and is recognized at an amount that reflects the consideration expected to be received in exchange for such goods or services. In addition, ASU 2014-09 requires disclosure of the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. The ASU is effective for fiscal years beginning after December 15, 2017. The new revenue standard is principle based and interpretation of those principles may vary from company to company based on their unique circumstances. It is possible that interpretation, industry practice, and guidance may evolve as companies and the accounting profession work to implement this new standard. The implementation of this standard did not have a material effect on the Company’s results of operations.

In January 2017, the FASB issued ASU No. 2017-04, Simplifying the Test for Goodwill Impairment, which simplifies the subsequent measurement of goodwill by eliminating Step 2 from the goodwill impairment test. In computing the implied fair value of goodwill under Step 2, current U.S. GAAP requires the performance of procedures to determine the fair value at the impairment testing date of assets and liabilities (including unrecognized assets and liabilities) following the procedure that would be required in determining the fair value of assets acquired and liabilities assumed in a business combination. Instead, the amendments under this ASU require the goodwill impairment test to be performed by comparing the fair value of a reporting unit with its carrying amount. An impairment charge should be recognized for the amount by which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. The ASU becomes effective for the Company on January 1, 2020. The amendments in this ASU will be applied on a prospective basis. Early adoption is permitted for interim or annual goodwill impairment tests performed.

In August 2016, the Financial Accounting Standards Board (the “FASB”) issued ASU 2016-15, Statement of Cash Flows (Topic 230). The update addresses eight specific cash flow issues and is intended to reduce diversity in practice in how certain cash receipts and cash payments are presented and classified in the statement of cash flows. This update is effective for reporting periods beginning after December 15, 2017, including interim periods within the reporting period. Adoption of ASU 2016-15 did not have a material effect on our financial statements.

In May 2017, the FASB issued ASU No. 2017-09, Stock Compensation - Scope of Modification Accounting, which provides guidance on which changes to the terms or conditions of a share-based payment award require an entity to apply modification accounting. The ASU requires that an entity account for the effects of a modification unless the fair value (or calculated value or intrinsic value, if used), vesting conditions and classification (as equity or liability) of the modified award are all the same as for the original award immediately before the modification. The ASU became effective for the Company on January 1, 2018 and will be applied to an award modified on or after the adoption date. Adoption of ASU 2017-09 did not have a material effect on the Company’s financial statements.

Effective June 1, 2018, the Company adopted Accounting Standards Codification (“ASC”) 606 — Revenue from Contracts with Customers. Under ASC 606, the Company recognizes revenue from the commercial sales of products, licensing agreements and contracts to perform pilot studies by applying the following steps: (1) identify the contract with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to each performance obligation in the contract; and (5) recognize revenue when each performance obligation is satisfied. For the comparative periods, revenue has not been adjusted and continues to be reported under ASC 605 — Revenue Recognition. Under ASC 605, revenue is recognized when the following criteria are met: (1) persuasive evidence of an arrangement exists; (2) the performance of service has been rendered to a customer or delivery has occurred; (3) the amount of fee to be paid by a customer is fixed and determinable; and (4) the collectability of the fee is reasonably assured. There was no impact on the Company’s financial statements as a result of adopting ASC 606.

There are various other updates recently issued, most of which represented technical corrections to the accounting literature or application to specific industries and are not expected to a have a material impact on the Company’s consolidated financial position, results of operations or cash flows.

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RELATED PARTY TRANSACTIONS

3 Months Ended

Nov. 30, 2019

Related Party Transactions [Abstract]

RELATED PARTY TRANSACTIONS

NOTE 5- RELATED PARTY TRANSACTIONS

Preferred Stock Issued for Services

On July 25, 2017, the Articles of Incorporation were amended to increase the voting rights of preferred shares to 100,000 votes per share. The Series A share amendments valued according to the additional voting rights and dividend rights assigned. The value assigned to the dividend rights was derived from a model utilizing future economic value of the dividends and was $0 which was recorded on the grant date as stock-based compensation.  The value assigned to the voting rights was derived from a model utilizing control premiums to value the voting control of the preferred stock and was $54,000 which was recorded on the grant date as stock-based compensation.

On December 4, 2017, the Company granted 50,000 additional Series A Preferred Stock shares to Robert Cashman, a related party.  The value assigned to the new shares was derived from a model utilizing control premiums to value the voting control of the preferred stock and was $1,000 which was recorded on the grant date as stock-based compensation.

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) - USD ($)	Nov. 30, 2019	Aug. 31, 2019
Total fixed assets, gross	$ 461,499	$ 459,784
Less: accumulated depreciation	(306,065)	(302,048)
Total fixed assets, net	155,434	157,736
Equipment
Total fixed assets, gross	369,673	367,958
Vehicles
Total fixed assets, gross	15,000	15,000
Furniture
Total fixed assets, gross	24,000	24,000
Leasehold improvements
Total fixed assets, gross	$ 52,826	$ 52,826

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CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY DEFICIT (UNAUDITED) - USD ($)	Common Stock	Preferred Stock	Additional Paid-In Capital	Stock Payable	Accumulated Deficit	Total
Beginning Balance at Aug. 31, 2018	$ 8,852,874	$ 150	$ (5,611,302)		$ (3,056,563)	$ 185,159
Beginning Balance (in shares) at Aug. 31, 2018	8,852,873,544	150,000
Net Income (loss)					876	876
Ending Balance at Aug. 31, 2019	$ 8,852,874	$ 150	(5,611,302)		(3,055,687)	186,035
Ending Balance (in shares) at Aug. 31, 2019	8,852,873,544	150,000
Stock Payable for Note Conversion
Net Income (loss)					(17,165)	(17,165)
Ending Balance at Nov. 30, 2019	$ 8,852,874	$ 150	$ (5,611,302)		$ (3,072,852)	$ 168,870
Ending Balance (in shares) at Nov. 30, 2019	8,852,873,544	150,000

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Document and Entity Information - shares	3 Months Ended
	Nov. 30, 2019	Jan. 14, 2020
Document and Entity Information
Entity Registrant Name	Service Team Inc.
Document Type	10-Q
Document Period End Date	Nov. 30, 2019
Amendment Flag	false
Entity Central Index Key	0001535635
Current Fiscal Year End Date	--08-31
Entity Common Stock, Shares Outstanding		8,852,873,544
Entity Filer Category	Non-accelerated Filer
Entity Emerging Growth Company	false
Entity Small Business	true
Entity Shell Company	false
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Incorporation, State or Country Code	WY
Entity File Number	333-178210
Document Fiscal Year Focus	2020
Document Fiscal Period Focus	Q1

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CAPITAL STOCK

3 Months Ended

Nov. 30, 2019

Capital Stock

CAPITAL STOCK

NOTE 3 – CAPITAL STOCK

The Company's authorized capital is 20,000,000,000 common shares with a par value of $0.001 per share and 150,000 preferred shares with a par value of $0.001 per share.  

Common Shares

On February 12, 2016, the Articles of Incorporation were amended to increase the authorized shares of capital stock to 500,000,000.   On December 20, 2016, the Articles of Incorporation were amended to increase the authorized share of capital stock to 1,000,000,000.    On January 19, 2017, the Articles of Incorporation were amended to increase the authorized share of capital stock to 2,000,000,000.   On February 16, 2017, the Articles of Incorporation were amended to increase the authorized share of capital stock to 3,000,000,000.   On April 27, 2017, the Articles of Incorporation were amended to increase the authorized share of capital stock to 4,500,000,000.  On June 13, 2017, the Articles of Incorporation were amended to increase the authorized share of capital stock to 8,000,000,000.   On June 28, 2017, the Articles of Incorporation were amended to increase the authorized share of capital stock to 10,000,000,000.  On August 22, 2017, the Company moved its state of domicile from Nevada to Wyoming, and in the process of the transfer increased its authorized common stock to 20,000,000,000.

Preferred Shares

On January 23, 2015, Service Team Inc. filed with the Secretary of State of Nevada a Certificate of Designation for 100,000 shares of Series A Preferred Stock.  The Designation gives the Series A Preferred Stock 500 votes per share.   Series A Preferred Stock were not entitled to receive dividends, any liquidation preference, or conversion rights.  On October 16, 2015, the Designation of Preferred Stock was amended to allow Preferred Shareholders to receive dividends in an amount equal to dividends paid per share on Common Stock.  On July 27, 2016, an amendment was filed to increase the voting rights of the preferred stock from 500 votes per share to 10,000 votes per share. The Series A share amendments valued according to the additional voting rights and dividend rights assigned. The value assigned to the dividend rights was derived from a model utilizing future economic value of the dividends and was $525 which was recorded on the grant date as stock based compensation.  The value assigned to the voting rights was derived from a model utilizing control premiums to value the voting control of the preferred stock and was $83,000 which was recorded on the grant date as stock based compensation.  On December 30, 2016 the Articles of Incorporation were amended to increase the authorized preferred shares to 150,000.

On July 25, 2017, the Articles of Incorporation were amended to increase the voting rights of preferred shares to 100,000 votes per share. The Series A share amendments valued according to the additional voting rights and dividend rights assigned. The value assigned to the dividend rights was derived from a model utilizing future economic value of the dividends and was $0 which was recorded on the grant date as stock based compensation.  The value assigned to the voting rights was derived from a model utilizing control premiums to value the voting control of the preferred stock and was $54,000 which was recorded on the grant date as stock based compensation.

On December 4, 2017, the Company granted 50,000 additional Series A Preferred Stock shares to Robert Cashman, a related party.  The value assigned to the new shares was derived from a model utilizing control premiums to value the voting control of the preferred stock and was $1,000 which was recorded on the grant date as stock based compensation.

Share Transactions

2020

There were no share transactions in 2020

2019

There were no share transactions in 2019

Stock Based Compensation

We have accounted for stock-based compensation under the provisions of FASB Accounting Standards codification (ASC) 718-10-55.  (Prior authoritative literature:  FASB Statement 123 (R), Share-based payment.)  This statement requires us to record any expense associated with the fair value of stock-based compensation.  Determining fair value requires input of highly subjective assumptions, including the expected price volatility.  Changes in these assumptions can materially affect the fair value estimate. As of November 30, 2019, the company has not granted any stock options.

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INCOME TAXES (Details 1) - USD ($)	Nov. 30, 2019	Aug. 31, 2019
Components of deferred tax asset:
Non capital tax loss carry forwards	$ 180,201	$ 177,285
Less: valuation allowance	(180,201)	(177,285)
Net deferred tax asset	$ 0	$ 0

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CAPITAL STOCK (Details Narrative) - $ / shares	Nov. 30, 2019	Aug. 31, 2019
Capital Stock
Common Stock, par or stated value	$ 0.001	$ 0.001
Common Stock, shares authorized	20,000,000,000	20,000,000,000
Preferred Stock, shares authorized	150,000	150,000
Preferred Stock, par or stated value	$ 0.001	$ 0.001

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

3 Months Ended

Nov. 30, 2019

Accounting Policies [Abstract]

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The consolidated financial statements presented in this report are the combined financial reports of Trade Leasing, Inc. and Service Team Inc. 

The Company maintains its accounting records on an accrual basis in accordance with generally accepted accounting principles in the United States of America (U.S. GAAP).

The consolidated financial statements present the Balance Sheet, Statements of Operations, Shareholders' Equity and Cash Flows of the Company. These consolidated financial statements are presented in United States dollars. The accompanying audited, consolidated financial statements have been prepared in accordance with the instructions to Form 10-Q.  All adjustments which are, in the opinion of management, necessary for a fair presentation of the results of operations for the interim periods have been made and are of a recurring nature unless otherwise disclosed herein.

Principles of Consolidation

The accompanying consolidated financial statements include the accounts of Service Team Inc. and Trade Leasing, Inc. both of which are under common control and ownership. The consolidated financial statements herein contain the operations of the wholly-owned subsidiaries listed above. All significant inter-company transactions have been eliminated in the preparation of these financial statements. 

Use of Estimates

The preparation of the consolidated financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, and disclosure of contingent liabilities at the date of the financial statements and the reported amounts of expenses during the reporting period.  Actual results could differ from those estimates. 

Going Concern

The Company's financial statements are prepared using the accrual method of accounting in accordance with accounting principles generally accepted in the United States of America, and have been prepared on a going concern basis, which contemplates the realization of assets and the settlement of liabilities in the normal course of business. The Company has an accumulated deficit as of November 30, 2019 of $3,072,852 and is dependent on raising capital through placement of our common stock in order to implement its business plan. There can be no assurance that the Company will be successful in order to continue as a going concern. The Company is funding its initial operations by issuing common shares and debt.  We cannot be certain that capital will be provided when it is required.

 Cash and Equivalents

Cash and equivalents include investments with initial maturities of three months or less. The Company maintains its cash balances at credit-worthy financial institutions that are insured by the Federal Deposit Insurance Corporation ("FDIC") up to $250,000. There were no cash equivalents at November 30, 2019, or August 31, 2019.

Concentration of Credit Risk

Financial instruments and related items, which potentially subject the Company to concentrations of credit risk, are cash and cash equivalents. The Company places its cash and temporary cash investments with credit quality institutions. At times, such investments may be in excess of FDIC insurance limits.

Accounts Receivable

All accounts receivable are due thirty (30) days from the date billed. If the funds are not received within thirty (30) days the customer is contacted to arrange payment. The Company uses the allowance method to account for uncollectable accounts receivable. Whilst management is confident that its customers will settle their debts, it has recorded an allowance for doubtful accounts in amount of $14,310 as of November 30, 2019 and August 31, 2019

Accounts Receivable and Revenue Concentrations

The company has approximately 400 customers. One customer South Bay Ford represented more than 10% of sale in the last 12 months. The company is not dependent on a few major customers.

Inventory

The Company does not own inventory, materials are purchased as needed from local suppliers; therefore, there was no additional inventory on hand at November 30, 2019 or August 31, 2019. 

Property and Equipment

Equipment, vehicles and furniture, which are recorded at cost, consist primarily of fabrication equipment and are depreciated using the straight-line method over the estimated useful lives of the related assets (generally 15 years or less). Costs incurred for maintenance and repairs are expensed as incurred and expenditures for major replacements and improvements are capitalized and depreciated over their estimated remaining useful lives. There was $4,017 and $4,206 of depreciation expense during the three months ended November 30, 2019 and 2018, respectively. 

 Net property and equipment were as follows at November 30, 2019 and August 31, 2019: 

	11-30-19		8-31-19
Equipment	$	369,673	$	367,958
Vehicles		15,000		15,000
Furniture		24,000		24,000
Leasehold improvements		52,826		52,826
Subtotal		461,499		459,784
Less: accumulated depreciation		306,065		(302,048	)
Total Fixed Assets, Net	$	155,434	$	157,736

Lease Commitments

Service Team Inc. leases facilities at 1818 Rosslynn Avenue, Fullerton, California, to manufacture its products.   The facility is leased for six and one half years at a price of $10,000 per month, for the first six months; and, $14,000 per month thereafter.  Service Team Inc pays for the fire insurance and property taxes on the building estimated to be approximately $2,000 per month. The location consists of three acres of land and one building of approximately 30,000 square feet.   As of November 30, 2019, the deferred rent related to this lease was $7,333 and is included in accrued expenses.

The table below discloses the Company’s future minimum lease payment obligations as of November 30, 2019.

2020	$	126,000
2021		168,000
2022		14,000
TOTAL:	$	308,000

Beneficial Conversion Features

From time to time, the Company may issue convertible notes that may contain an imbedded beneficial conversion feature. A beneficial conversion feature exists on the date a convertible note is issued when the fair value of the underlying common stock to which the note is convertible into is in excess of the remaining unallocated proceeds of the note after first considering the allocation of a portion of the note proceeds to the fair value of warrants, if related warrants have been granted. The intrinsic value of the beneficial conversion feature is recorded as a debt discount with a corresponding amount to additional paid in capital. The debt discount is amortized to interest expense over the life of the note using the effective interest method.

Fair Value of Financial Instruments

The Company adopted Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) 820 on June 6, 2011. Under this FASB, fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (an exit price). The standard outlines a valuation framework and creates a fair value hierarchy in order to increase the consistency and comparability of fair value measurements and the related disclosures. Under GAAP, certain assets and liabilities must be measured at fair value, and FASB ASC 820-10-50 details the disclosures that are required for items measured at fair value.

 The Company has various financial instruments that must be measured under the new fair value standard including: cash, convertible notes payable, accrued expenses, promissory notes payable, accounts receivable and accounts payable. The Company's financial assets and liabilities are measured using inputs from the three levels of the fair value hierarchy. The three levels are as follows:   

Level 1 – Inputs are unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date.  The fair value of the Company's cash is based on quoted prices and therefore classified as Level 1. 

Level 2 - Inputs include quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability (e.g., interest rates, yield curves, etc.), and inputs that are derived principally from or corroborated by observable market data by correlation or other means (market corroborated inputs).

Level 3 - Unobservable inputs that reflect our assumptions about the assumptions that market participants would use in pricing the asset or liability.

Cash, accounts receivable, accounts payable, promissory notes, convertible notes and accrued expenses reported on the balance sheet are estimated by management to approximate fair market value due to their short-term nature.

 The following table presents assets and liabilities that were measured and recognized at fair value as of November 30, 2019 on a recurring basis:

Description	Level 1		Level 2		Level 3		Total Realized Loss
Convertible Note Payable-net	$	0	$	—	$	—	$	—
Convertible Note Payable-net, in default		136,632		—		—		—
Total	$	136,632		—		—		—

The following table presents assets and liabilities that were measured and recognized at fair value as of August 31, 2019 on a recurring basis: 

Description	Level 1		Level 2		Level 3		Total Realized Loss
Convertible Note Payable-net	$	140,232	$	—	$	—	$	—
Total	$	140,232		—		—		—

Income Taxes

In assessing the realization of deferred tax assets, the Company considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. The Company considers the scheduled reversal of deferred tax liabilities, projected future taxable income, and tax planning strategies in making this assessment. Based on the level of historical operating results and the uncertainty of the economic conditions, the Company has recorded a full valuation allowance against its deferred tax assets at November 30, 2019 and August 31, 2019 where it cannot conclude that it is more likely than not that those assets will be realized.

Revenue Recognition

Trade Leasing Inc dba Delta Stag Manufacturing

Service Team Inc, 100% owned subsidiary Trade Leasing Inc dba Delta Stag Manufacturing receives orders from customers to build or repair truck bodies. The company builds the requested product. At the completion of the product the truck is delivered to the customer.  If the customer accepts the product Trade Leasing Inc dba Delta Stag Manufacturing issues an invoice to the customer for the job. The invoice is entered into our accounting system and is recognized as revenue at that time.

In Trade Leasing Inc we use the completed contract method for truck bodies built, which typically have construction periods of 15 days or less. Contracts are considered complete when title has passed, the customer has accepted the product and we do not retain risks or rewards of ownership of the truck bodies. Losses are accrued if manufacturing costs are expected to exceed manufacturing contract revenue.  Manufacturing expenses are primarily composed of aluminum cost, which is the largest component of our raw materials cost and the cost of labor. 

On September 1, 2018, we adopted Accounting Standards Update No. 2014-09, Revenue from Contracts with Customers (Topic 606), which supersedes the revenue recognition requirements in Accounting Standards Codification (ASC) Topic 605, Revenue Recognition (Topic 605). Results for reporting periods beginning after September 1, 2018 are presented under Topic 606. The impact of adopting the new revenue standard was not material to our financial statements and there was no adjustment to beginning retained earnings on September 1, 2018.

Under Topic 606, revenue is recognized when control of the promised goods or services is transferred to our customers, in an amount that reflects the consideration we expect to be entitled to in exchange for those goods or services.

We determine revenue recognition through the following steps:

● identification of the contract, or contracts, with a customer;

● identification of the performance obligations in the contract;

● determination of the transaction price;

● allocation of the transaction price to the performance obligations in the contract; and

● recognition of revenue when, or as, we satisfy a performance obligation. 

Share Based Expenses

The Company accounts for the issuance of equity instruments to acquire goods and/or services based on the fair value of the goods and services or the fair value of the equity instrument at the time of issuance, whichever is more readily determinable. The Company's accounting policy for equity instruments issued to consultants and vendors in exchange for goods and services follows the provisions of standards issued by the FASB. The measurement date for the fair value of the equity instruments issued is determined at the earlier of (i) the date at which a commitment for performance by the consultant or vendor is reached or (ii) the date at which the consultant or vendor's performance is complete. In the case of equity instruments issued to consultants, the fair value of the equity instrument is recognized over the term of the consulting agreement.

Stock Based Compensation

In December of 2004, the FASB issued a standard which applies to transactions in which an entity exchanges its equity instruments for goods or services and also applies to liabilities an entity may incur for goods or services that are based on the fair value of those equity instruments. For any unvested portion of previously issued and outstanding awards, compensation expense is required to be recorded based on the previously disclosed methodology and amounts. Prior periods presented are not required to be restated. We adopted the standard as of inception.  The Company has not issued any stock options to its Board of Directors and officers as compensation for their services.  If options are granted, they will be accounted for at a fair value as required by the FASB ASC 718.

Net Loss Per Share

The Company adopted the standard issued by the FASB, which requires presentation of basic earnings or loss per share and diluted earnings or loss per share. Basic income (loss) per share ("Basic EPS") is computed by dividing net income (loss) available to common stockholders by the weighted average number of common shares outstanding during the period. Diluted earnings per share ("Diluted EPS") are similarly calculated using the treasury stock method except that the denominator is increased to reflect the potential dilution that would occur if dilutive securities at the end of the applicable period were exercised.  During the three month period ended November 30, 2018, because the Company operations resulted in net income, therefore additional dilutive securities were included in the diluted EPS.   During the three month period ended November 30, 2019, there were net losses; therefore, no additional dilutive securities were included in the diluted EPS as that would be anti-dilutive to the resulting diluted earnings per share.
 

Recent Accounting Pronouncements

In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842): Accounting for Leases. This update requires that lessees recognize right-of-use assets and lease liabilities that are measured at the present value of the future lease payments at lease commencement date. The recognition, measurement, and presentation of expenses and cash flows arising from a lease by a lessee will largely remain unchanged and shall continue to depend on its classification as a finance or operating lease. The Company has performed a comprehensive review in order to determine what changes were required to support the adoption of this new standard. The Company will elect the optional transition method that allows for a cumulative-effect adjustment in the period of adoption and will not restate prior periods. Under the new guidance, the Company’s lease will continue to be classified as operating. During fiscal 2020, the Company will complete its implementation of its processes and policies to support the new lease accounting and reporting requirements. The adoption of this ASU is not expected to have a significant impact on our Consolidated Statements of Operations or Cash Flows.

In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606), to clarify the principles of recognizing revenue and create common revenue recognition guidance between U.S. GAAP and International Financial Reporting Standards. Under ASU 2014-09, revenue is recognized when a customer obtains control of promised goods or services and is recognized at an amount that reflects the consideration expected to be received in exchange for such goods or services. In addition, ASU 2014-09 requires disclosure of the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. The ASU is effective for fiscal years beginning after December 15, 2017. The new revenue standard is principle based and interpretation of those principles may vary from company to company based on their unique circumstances. It is possible that interpretation, industry practice, and guidance may evolve as companies and the accounting profession work to implement this new standard. The implementation of this standard did not have a material effect on the Company’s results of operations.

In January 2017, the FASB issued ASU No. 2017-04, Simplifying the Test for Goodwill Impairment, which simplifies the subsequent measurement of goodwill by eliminating Step 2 from the goodwill impairment test. In computing the implied fair value of goodwill under Step 2, current U.S. GAAP requires the performance of procedures to determine the fair value at the impairment testing date of assets and liabilities (including unrecognized assets and liabilities) following the procedure that would be required in determining the fair value of assets acquired and liabilities assumed in a business combination. Instead, the amendments under this ASU require the goodwill impairment test to be performed by comparing the fair value of a reporting unit with its carrying amount. An impairment charge should be recognized for the amount by which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. The ASU becomes effective for the Company on January 1, 2020. The amendments in this ASU will be applied on a prospective basis. Early adoption is permitted for interim or annual goodwill impairment tests performed.

In August 2016, the Financial Accounting Standards Board (the “FASB”) issued ASU 2016-15, Statement of Cash Flows (Topic 230). The update addresses eight specific cash flow issues and is intended to reduce diversity in practice in how certain cash receipts and cash payments are presented and classified in the statement of cash flows. This update is effective for reporting periods beginning after December 15, 2017, including interim periods within the reporting period. Adoption of ASU 2016-15 did not have a material effect on our financial statements.

In May 2017, the FASB issued ASU No. 2017-09, Stock Compensation - Scope of Modification Accounting, which provides guidance on which changes to the terms or conditions of a share-based payment award require an entity to apply modification accounting. The ASU requires that an entity account for the effects of a modification unless the fair value (or calculated value or intrinsic value, if used), vesting conditions and classification (as equity or liability) of the modified award are all the same as for the original award immediately before the modification. The ASU became effective for the Company on January 1, 2018 and will be applied to an award modified on or after the adoption date. Adoption of ASU 2017-09 did not have a material effect on the Company’s financial statements.

Effective June 1, 2018, the Company adopted Accounting Standards Codification (“ASC”) 606 — Revenue from Contracts with Customers. Under ASC 606, the Company recognizes revenue from the commercial sales of products, licensing agreements and contracts to perform pilot studies by applying the following steps: (1) identify the contract with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to each performance obligation in the contract; and (5) recognize revenue when each performance obligation is satisfied. For the comparative periods, revenue has not been adjusted and continues to be reported under ASC 605 — Revenue Recognition. Under ASC 605, revenue is recognized when the following criteria are met: (1) persuasive evidence of an arrangement exists; (2) the performance of service has been rendered to a customer or delivery has occurred; (3) the amount of fee to be paid by a customer is fixed and determinable; and (4) the collectability of the fee is reasonably assured. There was no impact on the Company’s financial statements as a result of adopting ASC 606.

There are various other updates recently issued, most of which represented technical corrections to the accounting literature or application to specific industries and are not expected to a have a material impact on the Company’s consolidated financial position, results of operations or cash flows.

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INCOME TAXES (Details) - USD ($)	3 Months Ended
	Nov. 30, 2019	Nov. 30, 2018
Income Tax Disclosure [Abstract]
Net tax loss carry-forwards	$ 858,102	$ 844,216
Statutory rate	21.00%	21.00%
Expected tax recovery	$ 180,201	$ 177,285
Change in valuation allowance	(180,201)	(177,285)
Income tax provision	$ 0	$ 0

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($)	3 Months Ended
	Nov. 30, 2019	Nov. 30, 2018	Aug. 31, 2019
Accounting Policies [Abstract]
Accumulated deficit	$ (3,072,852)		$ (3,055,687)
Allowance for Accounts receivable	14,310		14,310
Lease of California office premises per month	10,000
Cash insured by the Federal Deposit Insurance Corporation ("FDIC")	250,000
Cash equivalents	0		0
Depreciation Expense	4,017	$ 4,206
Deferred rent related to operating lease	7,333
Inventory	$ 0		$ 0

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CONSOLIDATED STATEMENT OF OPERATIONS (UNAUDITED) - USD ($)	3 Months Ended
	Nov. 30, 2019	Nov. 30, 2018
REVENUES
Sales	$ 994,625	$ 993,889
COST OF SALES
Cost of sales	824,002	717,017
Gross Margin	170,623	276,872
OPERATING EXPENSES
General & administrative expenses	174,689	126,460
Depreciation expense	4,017	4,206
Total Operating Expenses	178,706	130,666
INCOME FROM OPERATIONS	(8,083)	146,206
OTHER EXPENSE
Interest Expense	(9,082)	32,680
Total Other Expense	(9,082)	32,680
NET INCOME (LOSS)	$ (17,165)	$ 113,526
Weighted average number of common shares outstanding - basic	8,852,873,544	8,852,873,544
Weighted average number of common shares outstanding - diluted	8,852,873,544	11,515,613,544
Net earnings (loss) per common share - basic	$ (0.00)	$ (0.00)
Net earnings (loss) per common share - diluted	$ (0.00)	$ (0.00)

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ORGANIZATION (Details Narrative)	Jun. 05, 2014 shares
Health Care Organizations [Abstract]
Number of shares of common stock acquired in Trade Leasing Inc.	4,000,000

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SUBSEQUENT EVENTS

3 Months Ended

Nov. 30, 2019

Subsequent Events [Abstract]

SUBSEQUENT EVENTS

NOTE 8 – SUBSEQUENT EVENTS

Management has evaluated subsequent events to the requirements of ASC 855, and there are currently no subsequent events to report.

On January 22, 2020 the company filed a Form 15 with the Securities and Exchange Commission.

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DEBT TRANSACTIONS

3 Months Ended

Nov. 30, 2019

Debt Disclosure [Abstract]

DEBT TRANSACTIONS

NOTE 4 – DEBT TRANSACTIONS

Convertible Notes Payable – Related Party

R.L. Cashman

On April 17, 2017, the Company issued a convertible note to Robert Cashman (a related party) for $12,500 of cash consideration.  The note bears interest at 10%, matures on April 17, 2018, and is convertible into common stock at 50% of the average bid price of the stock during the 30 days prior to the conversion. The Company recorded a debt discount equal to $12,500 due to this conversion feature and amortized $4,658 during the year ended August 31, 2017, with a remaining debt discount of $7,842 amortized during the year ended August 31, 2018.  The note was repaid during the fiscal year ended August 31, 2018.

The Company evaluated the convertible note and determined that the shares issuable pursuant to the conversion option were determinate due to the conversion price floor and, as such, does not constitute a derivative liability as the Company has sufficient authorized shares and a conversion floor of $0.0005. In the event that the authorized shares were not sufficient, the Company has obtained authorization from a majority of shareholders such that the appropriate number of shares will be available or issuable for settlement to occur.

Convertible Notes Payable – Third Party

JMJ Financial Group

On April 28, 2017, the Company issued a convertible note to JMJ Financial Group for $55,000 of cash consideration.  The note bears interest at 12%, matures on April 28, 2018, and is convertible into common stock at 50% of the lowest 3 closing market prices of the previous 20 trading days prior to conversion. The Company recorded a debt discount equal to $37,080 due to this conversion feature. The Company also recorded a $6,000 and $11,920 debt discounts due to accrued interest and origination fees required by the agreement to be accrued at the beginning of the note. The note had accrued interest of $7,222 as of November 30, 2019 and August 31, 2019 respectively. The debt discounts had a balance at November 30, 2019 and August 31, 2019 of $0. The Company recorded debt discount amortization expense of $0 during the three months ended November 30, 2019 and during the year ended August 31, 2019. The Company converted $31,570 of principal and $12,222 of interest into shares during the year ended August 31, 2018.   This note is currently in default.

The Company evaluated the convertible note and determined that the shares issuable pursuant to the conversion option were determinate due to the conversion price floor and, as such, does not constitute a derivative liability as the Company has sufficient authorized shares and a conversion floor of $0.00005. In the event that the authorized shares were not sufficient, the Company has obtained authorization from a majority of shareholders such that the appropriate number of shares will be available or issuable for settlement to occur.

Tangiers Capital Group

On November 10, 2017, Service Team Inc issued a 12% Convertible Promissory Note payable to Tangiers Investment Group LLC (the "Investor") in the principal amount of $23,000. The Note, which is due on November 10, 2018, was funded by the Investor in the sum of $20,000 and $3,000 was retained by the Investor through an original issue discount or "OID" for due diligence and legal expense related to this transaction. The Note is convertible into shares of the Registrant's common stock, par value $0.001, at a conversion price of 50% of the lowest trading price of the Company's common stock during the 25 consecutive trading days prior to the date on which Holder elects to convert all or part of the Note.  The Company recorded a $20,000 discount due to the beneficial conversion feature.  During the year ended August 31, 2019, $18,526 of discount amortization was recorded, to result in a remaining debt discount balance of $0 as of August 31, 2019.  Accrued interest at August 31, 2019 and November 30, 2019 was $11,186 and $11,703, respectively.  This note is currently in default.

The Company evaluated the convertible note and determined that the shares issuable pursuant to the conversion option were determinate due to the conversion price floor and, as such, does not constitute a derivative liability as the Company has sufficient authorized shares and a conversion floor of $0.00005. In the event that the authorized shares were not sufficient, the Company has obtained authorization from a majority of shareholders such that the appropriate number of shares will be available or issuable for settlement to occur.

On February 27, 2018, Service Team Inc issued a 12% Convertible Promissory Note payable to Tangiers Investment Group LLC (the "Investor") in the principal amount of $23,000. The Note, which is due on February 27, 2019, was funded by the Investor in the sum of $20,000 and $3,000 was retained by the Investor through an original issue discount or "OID" for due diligence and legal expense related to this transaction. The Note is convertible into shares of the Registrant's common stock, par value $0.001, at a conversion price of 50% of the lowest trading price of the Company's common stock during the 25 consecutive trading days prior to the date on which Holder elects to convert all or part of the Note.  The Company recorded a $20,000 discount due to the beneficial conversion feature and a $3,000 discount due to the original issue discount. During the year ended August 31, 2019, the Company amortized $11,342 of the debt discount leaving a remaining balance of $0 as of August 31, 2019.  Accrued interest at August 31, 2019 and November 30, 2019 was $19,237 and $20,502, respectively.

The Company evaluated the convertible note and determined that the shares issuable pursuant to the conversion option were determinate due to the conversion price floor and, as such, does not constitute a derivative liability as the Company has sufficient authorized shares and a conversion floor of $0.00005. In the event that the authorized shares were not sufficient, the Company has obtained authorization from a majority of shareholders such that the appropriate number of shares will be available or issuable for settlement to occur.

Iconic Holdings LLC

On July 10, 2017, the Company issued a convertible note to Iconic Holdings of $34,993 for consideration of certain machine tools.  The note bears interest at 10%, matures on July 10, 2018, and is convertible into common stock at 50% of the lowest 3 closing market prices of the previous 20 trading days prior to conversion. The Company recorded a debt discount equal to $31,812 due to this conversion feature. The Company also recorded a $3,181 debt discount due to issuance fees. The note had accrued interest of $39,221 as of November 30, 2019 and $37,471 as of August 31, 2019.  The debt discounts had a balance of $0 as of August 31, 2019.  This note is currently in default.

The Company evaluated the convertible note and determined that the shares issuable pursuant to the conversion option were determinate due to the conversion price floor and, as such, does not constitute a derivative liability as the Company has sufficient authorized shares and a conversion floor of $0.00005. In the event that the authorized shares were not sufficient, the Company has obtained authorization from a majority of shareholders such that the appropriate number of shares will be available or issuable for settlement to occur.

Crown Bridge Partners, LLC.

On June 12, 2017, the Company issued a convertible note to Crown Bridge Partners, LLC. for $63,750 of cash consideration.  The note bears interest at 6%, matures on June 12, 2018, and is convertible into common stock at 55% of the lowest 3 closing market prices of the previous 20 trading days prior to conversion. The Company recorded a debt discount equal to $52,600 due to this conversion feature. The Company also recorded a $11,150 debt discount due to issuance fees. The note had accrued interest of $2,180 as of November 30, 2019 and $1,817 as of August 31, 2019.   The debt discounts had a balance at August 31, 2019 of $0.   This note is currently in default.

The Company evaluated the convertible note and determined that the shares issuable pursuant to the conversion option were determinate due to the conversion price floor and, as such, does not constitute a derivative liability as the Company has sufficient authorized shares and a conversion floor of $0.00005. In the event that the authorized shares were not sufficient, the Company has obtained authorization from a majority of shareholders such that the appropriate number of shares will be available or issuable for settlement to occur.

Crossover Capital Fund, LLC

On July 24, 2017, the Company issued a convertible note to Crossover Capital Fund, LLC for $40,000 of cash consideration.  The note bears interest at 10%, matures on July 24, 2018, and is convertible into common stock at 50% of the lowest 3 closing market prices of the previous 20 trading days prior to conversion. The Company recorded a debt discount equal to $40,000 due to this conversion feature. The note had accrued interest of $9,428 as of November 30, 2019 and $7,917 at August 31, 2019.   The debt discounts had a balance of $0 at August 31, 2018.     This note is currently in default.

The Company evaluated the convertible note and determined that the shares issuable pursuant to the conversion option were determinate due to the conversion price floor and, as such, does not constitute a derivative liability as the Company has sufficient authorized shares and a conversion floor of $0.00005. In the event that the authorized shares were not sufficient, the Company has obtained authorization from a majority of shareholders such that the appropriate number of shares will be available or issuable for settlement to occur.

Promissory Notes Payable – Third Party

IOU Financial

On March 30, 2018, the Company issued a promissory note to IOU Financial for $120,000 of cash consideration.  The note bears interest at 32% and matures on March 30, 2019. The Company recorded a debt discount equal to $38,630 due to the unpaid interest which was added to the principal balance to be repaid during the 12 month note.  During the year ended August 31, 2018, the company amortized $16,299 of the debt discount into interest expense leaving a remaining total debt discount on the note of $22,331 as of August 31, 2018.  During the year ended August 31, 2018, the Company repaid $69,206 in principal on the note in cash leaving a balance on the note of $73,200 owed as of August 31, 2018.  During the year ended August 31, 2019, the company amortized $22,331 of the debt discount into interest expense leaving a remaining total debt discount on the note of $0 as of August 31, 2019.  During the year ended August 31, 2019, the Company repaid $89,424 in principal on the note in cash leaving a balance on the note of $0 owed as of August 31, 2019.

 On January 22, 2019, the Company issued a promissory note to IOU Financial for $75,000 of cash consideration.  The note bears interest at 32%, matures on October 23, 2019.  The Company recorded a debt discount equal to $16,954 due to the unpaid interest which was added to the principal balance to be repaid during the 9 month note. During the year ended August 31, 2018, the company amortized $35,836 of the debt discount into interest expense leaving a remaining total debt discount on the note of $0 as of August 31, 2018.  The proceeds of the loan were used to pay $27,244 to IOU Financial to pay the note dated March 30, 2018 in full.  And the remaining amount $47,776 was added to working capital.  During the period ended August 31, 2019, the Company repaid $74,400 in principal on the note in cash leaving a balance on the note of $16,999 owed as of August 31, 2019. The note had interest of $7,917 as of August 31, 2019. This note was paid in full on December 12, 2019.