Quarterly report pursuant to Section 13 or 15(d)

Note 8 - Fair Value Measurements

v3.6.0.2
Note 8 - Fair Value Measurements
 6 Months Ended
Dec. 31, 2016
Notes to Financial Statements  
Fair Value Disclosures [Text Block]
NOTE
8
- FAIR VALUE MEASUREMENTS
 
We follow FASB ASC Topic No.
820,
Fair Value Measurements and Disclosures
(“ASC
820”)
in connection with financial assets and liabilities measured at fair value on a recurring basis subsequent to initial recognition.
 
ASC
820
requires that assets and liabilities carried at fair value be classified and disclosed in
one
of the following categories:
 
Level
1:
Quoted market prices in active markets for identical assets and liabilities.
Level
2:
Observable market based inputs or unobservable inputs that are corroborated by market data.
Level
3:
Unobservable inputs that are not corroborated by market data.
 
The hierarchy noted above requires us to minimize the use of unobservable inputs and to use observable market data, if available, when determining fair value.
 
The fair value of our recorded derivative liabilities is determined based on unobservable inputs that are not corroborated by market data, which is a Level
3
classification. As of
December
31,
2016
and
June
30,
2016,
the fair value of our Level
3
financial instruments was
$3,000
and
$24,000,
respectively. The table below sets forth a summary of changes in the fair value of our Level
3
financial instruments for the
six
months ended
December
31,
2016:
 
Fair value measurements of warrants using significant unobservable inputs (Level 3)
  
Balance at June 30, 2016
   $
24,000
  
Change in fair value of warrant liability
    
(14,000
)
Warrant exchange for common stock (Note 6)
    
(7,000
)
Balance at December 31, 2016
   $
3,000
  
 
The fair value of our warrant derivative liabilities and the change in the estimated fair value of derivative liabilities that we recorded during the
six
months ended
December
31,
2016,
related to warrants issued in connection with our private placement transactions (see Notes
6
and
7).