LIQUIDITY AND GOING CONCERN |
9 Months Ended | |
|---|---|---|
Mar. 31, 2016 | ||
| Liquidity And Going Concern [Abstract] | ||
| LIQUIDITY AND GOING CONCERN |
NOTE 2 - LIQUIDITY AND GOING CONCERN The accompanying consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company has incurred an accumulated deficit of $14,147,000 through March 31, 2016, and as of March 31, 2016 had limited cash and a substantial working capital deficit. To date, the Company’s revenues and operating cash flows have not been sufficient to sustain our operations and the Company has relied on debt and equity financing to fund its operations. Management estimates that additional capital of approximately $2 million is required to fund planned operations through March 31, 2017. Based on management’s evaluation of the Company’s expected cash requirements over the next twelve months, which include, but are not limited to, investments in additional sales and marketing and product development resources, capital expenditures, and working capital requirements, we have determined that the Company’s existing cash resources are not sufficient to meet our anticipated needs during the next twelve months, and that additional financing is required to support current operations. These factors raise substantial doubt about Company’s ability to continue as a going concern. The Company’s ability to continue as a going concern is dependent upon its ability to raise additional capital on a timely basis until such time as revenues and related cash flows are sufficient to fund our operations. Management plans to continue to seek funding, as necessary, through the private placements of debt and equity securities. Between July 1, 2014 and March 31, 2016, the Company has received a total of $4,475,000 through related party credit facilities of which $2,000,000 was converted to equity in September 2015. As of March 31, 2016 an aggregate of $1,025,000 was available for future draws at the lender’s discretion. The related party credit facility matures in July 2016, but may be further extended by the lender. A convertible line of credit with an unrelated party was entered into in October 2014 and matures on September 19, 2016, but can be extended if the lender provides for such in writing. At March 31, 2016, we have borrowed $215,000 under this line of credit and $285,000 remains available for future draws. We are pursuing other investment structures that management believes may generate the necessary funding for the Company. Although management believes that the additional required funding will be obtained, there is no guarantee that we will be able to obtain the additional required funds on a timely basis or that funds will be available on terms acceptable to the Company. If such funds are not available when required, we will be required to curtail our investments in additional sales and marketing and product development resources, and capital expenditures, which may have a material adverse effect on our future cash flows and results of operations, and our ability to continue operating as a going concern. The accompanying financial statements do not include any adjustments that would be necessary should we be unable to continue as a going concern and, therefore, be required to liquidate our assets and discharge our liabilities in other than the normal course of business and at amounts that may differ from those reflected in the accompanying condensed consolidated financial statements. |