INDIGENOUS ROOTS CORP. The following discussion should be read in conjunction with our audited
financial statements and the related notes for the years ended
Our audited financial statements are stated in
Cash Requirements
Over the next 12 months we intend to operate as a business development company. We anticipate that we will incur the following operating expenses during this period:
Estimated Funding Required During the Next 12 Months Expense
Amount
General, Administrative and Corporate Expenses $100,000
Operating Expenses $100,000
Total $200,000
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At present, our cash requirements for the next 12 months outweigh the funds available. In order to improve our liquidity, we plan to pursue additional equity financing from private investors or possibly a registered public offering. We do not currently have any definitive arrangements in place for the completion of any further private placement financings and there is no assurance that we will be successful in completing any further private placement financings. If we are unable to achieve the necessary additional financing, then we plan to reduce the amounts that we spend on our business activities and administrative expenses in order to be within the amount of capital resources that are available to us.
Going Concern
The financial statements included in this filing have been prepared in conformity with generally accepted accounting principles that contemplate the continuance of our company as a going concern, which contemplates the realization of assets and liquidation of liabilities in the normal course of business. The Company has no opportunity to realize any revenues at this time. Our financial condition raises substantial doubt about our company's ability to continue as a going concern.
The future of our company is dependent upon its ability to obtain financing and upon future profitable operations from the development of its mining activities.
Off-Balance Sheet Arrangements or capital resources that is material to stockholders.
There were none at
RESULTS OF OPERATIONS - THREE MONTHS ENDED
The following summary of our results of operations should be read in conjunction
with our financial statements for the three months ended
Our operating results for the three months endedNovember 30, 2021 and 2020 are summarized as follows: Three Months Three Months Ended Ended November 30, November 30, 2021 2020 Revenue$ (2,822 ) $ (2,003 ) Operating expenses 15,926 12,633 Other expense 443 18,330
Net (loss) income from operations
REVENUES
We generated revenue of
On
As the Company has forfeited control of the System, it will not realize any future revenues. All revenue generated by the System is paid directly to DSEU and the proceeds are applied to outstanding interest debt.
EXPENSES
General and administrative expenses were
Legal and audit expenses were
LIQUIDITY AND FINANCIAL CONDITION
WORKING CAPITAL
November 30, August 31,
2021 2021
Current assets $ 181,640 $ 514,445
Current liabilities 1,275,189 1,594,448
Working capital (deficit) $ (1,093,549 ) $ (1,080,003 )
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OPERATING ACTIVITIES
Cash provided by operating activities was
FINANCING ACTIVITIES
Cash used in financing activities was
Contractual Obligations
As a "smaller reporting company", we are not required to provide tabular disclosure obligations.
Critical Accounting Policies
Our financial statements and accompanying notes have been prepared in conformity
with accounting principles generally accepted in
Accounting estimates
The preparation of the financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amount of revenue and expenses during the reporting period. Actual results could differ from those estimates.
Cash and cash equivalents
For purposes of the statement of cash flows, our company considers highly liquid financial instruments purchased with a maturity of three months or less to be cash equivalents.
Fair value of financial instruments
The Company measures the fair value of financial assets and liabilities based on GAAP guidance which defines fair value, establishes a framework for measuring fair value, and expands disclosures about fair value measurements. Under GAAP, fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. A fair value hierarchy is also established, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value.
Income taxes
The Company follows the asset and liability method of accounting for income taxes, which requires recognition of deferred tax assets and liabilities for future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis and tax credit carry-forwards. 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. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in operations in the period that includes the enactment date. The Company has a net operating loss carry-forward to be used in future years. The Company has established a valuation allowance for the full tax benefit of the operating loss carry-forwards due to the uncertainty regarding realization.
Net loss per common share
Basic net loss per share is computed by dividing the net loss available to common stockholders for the period by the weighted average number of shares of common stock outstanding during the period. The calculation of diluted net loss per share gives effect to common stock equivalents; however, potential common shares are excluded if their effect is anti-dilutive.
Stock-based compensation
The Company applies the fair value method for accounting for stock option awards, whereby the Company recognizes a compensation expense for all stock options awarded to employees, officers and consultants based on the fair value of the options on the date of grant, which is determined using the Black-Scholes Option Pricing Model. The options are expensed over the vesting period of the options on a graded vesting basis.
The Company accounts for equity instruments issued in exchange for the receipt of goods or services from other than at the estimated fair market value of the consideration received or the estimated fair value of the equity instruments issued, whichever is more reliably measurable. The value of equity instruments issued for consideration for other than employee services is determined on the earliest of a performance commitment or completion of performance by the provider of goods or services.
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Concentration of credit risk
Our company places our cash and cash equivalents with high credit quality financial institutions.
Recent Accounting Pronouncements
Recent accounting pronouncements issued by the
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