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Going Concern
12 Months Ended
Oct. 31, 2022
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Going Concern

Note 3 – Going Concern

 

The Company’s financial statements are prepared in accordance with U.S. GAAP applicable to a going concern, which contemplates realization of assets and the satisfaction of liabilities in the normal course of business within one year after the date the consolidated financial statements are issued.

 

In accordance with Financial Accounting Standards Board (the “FASB”), Accounting Standards Update (“ASU”) No. 2014-15, Presentation of Financial Statements – Going Concern (Subtopic 205-40), our management evaluates whether there are conditions or events, considered in aggregate, that raise substantial doubt about our ability to continue as a going concern within one year after the date that the financial statements are issued. As shown in the accompanying consolidated financial statements, the Company has incurred significant recurring losses and negative cash flows from operations. These factors raised substantial doubt about the Company’s ability to continue as a going concern.

 

In response to the above, the Company assessed its management’s plans to alleviate that doubt. The Company has positive working capital as of October 31, 2022 of $7,487,941. The Company considered that its losses and negative cash flows were due to various factors such as: (i) uncertainty surrounding the PMTA process with FDA and (ii) the MDO that was issued to Bidi Vapor on its flavored ENDS product. However, the MDO was set aside and remanded by the 11th Circuit and the ability to appeal such decision has passed thereby facilitating the advancement of the flavored BIDI® Sticks for sale in the United States (pending FDA’s review of the flavored PMTAs). Concurrently, the PMTA of the tobacco-flavored (Classic) BIDI® Sticks for sale in the United States continues to move through scientific review (pending FDA’s review of that PMTA). Management’s assessment included the preparation of cash flow forecasts which considered increases in revenues considering the favorable ruling obtained on the MDO as disclosed above.

 

The Company believes that its available cash and the cash to be provided by future operating activities should enable the Company to meet its estimated liquidity needs for the next 12 months after the date that the financial statements are issued. Because of the above factors, the Company believes that this alleviates the substantial doubt in connection with the Company’s ability to continue as a going concern.

 

However, there is no assurance that the Company’s plans will be successful due to the current economic climate in the United States and globally. The consolidated financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classification of liabilities that may result from the outcome of these uncertainties.