The accompanying notes are an integral part of these interim consolidated financial statements.
The accompanying notes are an integral part of these consolidated financial statements.
The accompanying notes are an integral part of these consolidated financial statements.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
March 31, 2016
(Unaudited)
1.
ORGANIZATION AND BASIS OF PRESENTATION
On October 20, 2014 the Company completed the acquisition of The Spud Shack Fry Company Ltd. (Spud Shack), a restaurant located in British Columbia, Canada.
On December 21, 2015, the Company entered into an exclusive marketing agreement and was granted the exclusive worldwide marketing rights to a health and fitness application called 60K which is currently under development for iPhone, Android, tablets and desktop computers. Pursuant to the exclusive marketing agreement the Company will provide $100,000 in initial financing to complete the application as well as for marketing the release of a prototype. The Company will retain 30% of all revenue generated by the application.
In January 2016, the Company merged with its wholly owned subsidiary, I-Wellness Marketing Group Inc., which is a Nevada corporation incorporated during the six months ended March 31, 2016.
In February 9, 2016, the Company changed its name from Monarchy Ventures Inc. to I-Wellness Marketing Group Inc.
While the Company is attempting to generate sufficient revenues, the Companys cash position may not be enough to support the Companys daily operations. Management intends to raise additional funds through a public or private offering. Management believes that the actions presently being taken to further implement its business plan and generate sufficient revenues provide the opportunity for the Company to continue as a going concern. While the Company believes in the viability of its strategy to increase revenues and in its ability to raise additional funds, there can be no assurances to that effect. The ability of the Company to continue as a going concern is dependent upon the Companys ability to further implement its business plan and generate sufficient revenues.
The consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States for interim financial information and with the instructions to Form 10-Q and Article 8 of Regulation S-X. They do not include all information and notes required by generally accepted accounting principles for complete financial statements. Except as disclosed herein, there has been no material change in the information disclosed in the notes to the financial statements included in the Form 10-K of the Company for the period ended June 30, 2015. In the opinion of management, all adjustments (including normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the nine months ended March 31, 2016 are not necessarily indicative of the results that may be expected for the year ending June 30, 2016. For further information, these unaudited financial statements and the related notes should be read in conjunction with the Companys audited financial statements for period ended June 30, 2015 included in the Companys transition report on Form 10-K.
2. RELATED PARTIES
As of March 31, 2016, amounts of $476,256 were owing to related parties (June 30, 2015: $493,283). These amounts are unsecured and have no fixed interest or repayment terms.
During the nine months ended March 31, 2016 and 2015, $17,239 and $12,731 was incurred as remuneration to a shareholder of the Company who serves as the manager of the restaurant operation.
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3. PROPERTY AND EQUIPMENT
|
|
|
|
|
|
|
March 31, 2016
|
|
Cost
|
|
Accumulated
Depreciation
|
|
Net Book Value
March 31, 2016
|
Computer equipment
|
$
|
5,434
|
$
|
4,867
|
$
|
567
|
Furniture and fixtures
|
|
92,239
|
|
48,337
|
|
43,902
|
Leasehold improvements
|
|
153,017
|
|
44,957
|
|
108,061
|
|
$
|
250,690
|
$
|
98,160
|
$
|
152,530
|
|
|
|
|
|
|
|
June 30, 2015
|
|
Cost
|
|
Accumulated
Depreciation
|
|
Net Book Value
June 30, 2015
|
Computer equipment
|
$
|
5,650
|
$
|
4,646
|
$
|
1,004
|
Furniture and fixtures
|
|
95,912
|
|
42,206
|
|
53,706
|
Leasehold improvements
|
|
159,110
|
|
37,636
|
|
121,474
|
|
$
|
260,672
|
$
|
84,488
|
$
|
176,184
|
4. COMMITMENT
The minimum lease payments over the next five years are as follows:
|
|
2016
|
CAD$ 23,550
|
2017
|
47,100
|
2018
|
47,100
|
2019
|
50,868
|
2020
|
50,868
|
|
CAD$ 219,486
|
5. CONVERTIBLE PROMISSORY NOTES
As at March 31, 2016, the Company has $400,752 (June 30, 2015 - $388,892) in convertible promissory notes that are due on demand, bear interest at 5% and are unsecured. $75,000 of these promissory notes are convertible at $0.01, while the remaining are convertible at $0.001.
During the nine months ended March 31, 2016, $21,861 of convertible notes issued were issued with beneficial conversion features with intrinsic values in excess of the principal balance. As a result, the Company recorded a debt discount of $21,861. In addition, as these promissory notes are payable on demand, the debt discounts were fully amortized to interest expense during the period.
During the nine months ended March 31, 2016, $10,000 was converted into 10,000,000 common shares.
7. SUBSEQUENT EVENT
On March 19, 2016, the Company received $5,801 in convertible debt financing.
7