Form 10-Q - Quarterly report [Sections 13 or 15(d)]

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2023

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number: 000-52765

iCoreConnect Inc.

(Exact Name of Registrant as Specified in Its Charter)

Nevada

13-4182867

(State or other jurisdiction of

incorporation or organization)

(I.R.S. Employer

Identification No.)

529 E. Crown Point Road, Suite 250, Ocoee, FL 34761

(Address of principal executive offices) (Zip Code)

(888) 810-7706

(Registrant’s Telephone Number, Including Area Code)

__________________________

Securities registered pursuant to Section 12(b) of the Act: None

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large, accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large, accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated Filer	☒	Smaller reporting company	☒
Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of August 14, 2023 there were 197,454,470 shares of the registrant’s common stock outstanding.

iCoreConnect Inc.

FORM 10-Q QUARTERLY REPORT

FOR THE QUARTER ENDED JUNE 30, 2023

Part I Financial Information

Item 1	Financial Statements (Unaudited)

	Condensed Balance Sheets as of June 30, 2023 (Unaudited) and December 31, 2022	3

	Condensed Statements of Operations for the Three Months and Six Months Ended June 30, 2023 and 2022 (Unaudited)	4

	Condensed Statements of Changes in Stockholders’ Deficit for the Three Months and Six Months ended June 30, 2023 and 2022 (Unaudited)	5

	Condensed Statements of Cash Flows for the Six Months Ended June 30, 2023 and 2022 (Unaudited)	6

	Notes to Condensed Financial Statements	7

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	23

Item 3.	Quantitative and Qualitative Disclosures About Market Risks	30

Item 4.	Controls and Procedures	30

Part II Other Information

Item 1.	Legal Proceedings	31

Item 1A.	Risk Factors	31

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	31

Item 3.	Defaults Upon Senior Securities	31

Item 4.	Mine Safety Disclosures	31

Item 5.	Other Information	31

Item 6.	Exhibits	32

Signatures		33

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iCoreConnect Inc.

CONDENSED BALANCE SHEETS

AS OF JUNE 30, 2023 (UNAUDITED) AND DECEMBER 31, 2022

	June 30,			December 31,
	2023			2022
ASSETS	(unaudited)
Cash	$	68,735		$	196,153
Accounts receivable, net		365,940			414,809
Prepaid expenses and other current assets		684,655			480,706
Total current assets		1,119,330			1,091,668

Property and equipment, net		199,989			74,194
Right of use lease asset - operating		853,039			944,487
Software development costs, net		722,397			531,061
Acquired technology, net		37,664			79,428
Customer relationships, net		1,990,634			2,350,380
Goodwill		1,484,966			1,484,966
Total long-term assets		5,288,689			5,464,516

TOTAL ASSETS	$	6,408,019		$	6,556,184

LIABILITIES AND STOCKHOLDERS’ DEFICIT
Accounts payable and accrued expenses	$	2,745,951		$	2,336,174
Operating lease liability, current portion		135,935			169,417
Notes payable, current portion		6,909,118			4,279,531
Deferred revenue		88,140			13,847
Total current liabilities		9,879,144			6,798,969

Long-term debt, net of current maturities		-			1,449,261
Operating lease liability, net of current portion		755,453			809,458
Total long-term liabilities		755,453			2,258,719

TOTAL LIABILITIES	$	10,634,597		$	9,057,688

STOCKHOLDERS’ DEFICIT

Preferred Stock, par value $0.001; 10,000,000 shares authorized; Issued and Outstanding: 0 as of June 30, 2023 and December 31, 2022		-			-
Common Stock par value $0.001; 600,000,000 shares authorized; Issued and Outstanding: 196,148,863 as of June 30, 2023 and 181,320,528 as of December 31, 2022		196,149			181,321
Additional paid-in-capital		88,848,989			86,192,262
Accumulated deficit		(93,271,716	)		(88,875,087	)
TOTAL STOCKHOLDERS’ DEFICIT		(4,226,578	)		(2,501,504	)

TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT	$	6,408,019		$	6,556,184

The accompanying notes are an integral part of these condensed financial statements

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iCoreConnect Inc.

CONDENSED STATEMENTS OF OPERATIONS

FOR THE THRE MONTHS AND SIX MONTHS ENDED JUNE 30, 2023 AND 2022 (UNAUDITED)

	Three Months Ended						Six Months Ended
	June 30,			June 30,			June 30,			June 30,
	2023			2022			2023			2022
Revenue, net	$	1,856,148		$	2,011,161		$	3,696,519		$	4,055,050
Cost of sales		484,033			621,283			975,482			1,255,513
Gross profit		1,372,115			1,389,878			2,721,037			2,799,537

Expenses
Selling, general and administrative		3,189,103			2,261,577			5,560,174			4,293,934
Depreciation and amortization		291,600			340,245			580,509			714,100
Total operating expenses		3,480,703			2,601,822			6,180,683			5,008,034
Loss from operations		(2,108,588	)		(1,211,944	)		(3,459,646	)		(2,208,497	)

Other income (expense)
Interest expense		(270,770	)		(189,183	)		(528,683	)		(344,872	)
Finance charges		(342,015	)		(86,000	)		(422,078	)		(386,000	)
Other income (expense)		13,778			-			13,778			(89,993	)
Total other expense, net		(599,007	)		(275,183	)		(936,983	)		(820,865	)

Net loss	$	(2,707,595	)	$	(1,487,127	)	$	(4,396,629	)	$	(3,029,362	)

Net loss per share available to common stockholders, basic and diluted	$	(0.01	)	$	(0.01	)	$	(0.02	)	$	(0.02	)
Weighted average number of shares, basic and diluted		195,976,705			172,353,044			193,417,289			171,723,963

The accompanying notes are an integral part of these condensed financial statements

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iCoreConnect Inc.

CONDENSED STATEMENTS OF CHANGES IN STOCKHOLDERS’ DEFICIT

FOR THE SIX MONTHS ENDED JUNE 30, 2023 AND 2022 (UNAUDITED)

	Common stock						Additional Paid In			Accumulated			Total Stockholders’ Equity
	Shares			Amount			Capital			Deficit			(Deficit)
Balances at January 1, 2022		167,493,497		$	167,493		$	83,633,061		$	(82,795,263	)	$	1,005,291
Stock issued for cash		4,722,844			4,723			345,277			-			350,000
Finance fee on convertible debt								300,000						300,000
Stock compensation expense		-			-			255,697			-			255,697
Net loss		-			-			-			(1,542,235	)		(1,542,235	)
Balances at March 31, 2022		172,216,323		$	172,216		$	84,534,035		$	(84,337,498	)	$	368,753
Finance fee on convertible debt								86,000						86,000
Stock issued for conversion of debt		227,368			227			22,160						22,387
Stock compensation expense		30,000			30			272,530						272,560
Repurchase of common stock warrants								(45,000	)					(45,000	)
Net loss											(1,487,127	)		(1,487,127	)
Balances at June 30, 2022		172,473,691		$	172,473		$	84,869,725		$	(85,824,625	)	$	(782,427	)

Balances at January 1, 2023		181,320,528		$	181,321		$	86,192,262		$	(88,875,087	)	$	(2,501,504	)
Stock issued for cash		5,400,000			5,400			534,600						540,000
Finance fee								80,063						80,063
Stock issued for conversion of debt		7,057,198			7,057			678,276						685,333
Stock compensation expense		150,000			150			272,833						272,983
Net loss											(1,689,034	)		(1,689,034	)
Balances at March 31, 2023		193,927,726			193,928			87,758,034			(90,564,121	)		(2,612,159	)
Finance fee								342,015						342,015
Stock issued for conversion of debt		(203,863	)		(204	)		204						-
Stock compensation expense		2,425,000			2,425			748,736						751,161
Net loss											(2,707,595	)		(2,707,595	)
Balances at June 30, 2023		196,148,863		$	196,149		$	88,848,989		$	(93,271,716	)	$	(4,226,578	)

The accompanying notes are an integral part of these condensed financial statements

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iCoreConnect Inc.

CONDENSED STATEMENTS OF CASH FLOWS

FOR THE SIX MONTHS ENDED JUNE 30, 2023 AND 2022 (UNAUDITED)

	June 30,			June 30,
	2023			2022
	(unaudited)			(unaudited)
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss	$	(4,396,629	)	$	(3,029,362	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation expense		10,577			10,981
Amortization expense		569,932			703,118
Finance fee		422,078			386,000
Change in allowance for doubtful accounts		110,520			137,676
Gain on sale of assets		13,778			-
Stock compensation expense		1,024,144			528,257
Non-cash interest expense		103,539			82,804
Changes in operating assets and liabilities:
Accounts receivable		(61,651	)		(210,502	)
Prepaid expenses and other current assets		(203,949	)		(87,673	)
Right of use asset, net of lease liability		3,961			22,833
Accounts payable and accrued expenses		409,777			15,946
Deferred revenue		74,293			(20,419	)
NET CASH USED IN OPERATING ACTIVITIES		(1,919,630	)		(1,434,944	)

INVESTING ACTIVITIES
Sale of capital assets		28,000			-
Purchase of capital assets		(178,150	)	-
Additions to capitalized software		(359,758	)		(129,898	)
NET CASH USED IN INVESTING ACTIVITIES		(509,908	)		(129,898	)

FINANCING ACTIVITES
Net proceeds from debt		2,263,010			2,420,000
Payments on debt		(1,186,223	)		(1,112,591	)
Proceeds from issuance of common stock		540,000			350,000
Purchase of common stock warrants		-			(22,500	)
Stock issued for conversion of convertible debt		685,333			22,387
NET CASH PROVIDED BY FINANCING ACTIVITIES		2,302,120			1,657,296

NET CHANGE IN CASH		(127,418	)		92,454
CASH AT BEGINNING OF THE PERIOD		196,153			71,807
CASH AT END OF THE PERIOD	$	68,735		$	164,261

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid during the period for interest	$	348,941		$	301,644

The accompanying notes are an integral part of these condensed financial statements

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iCoreConnect Inc.

Notes to Condensed Financial Statements

June 30, 2023

1. NATURE OF OPERATIONS

iCoreConnect Inc., (the “Company”), a Nevada Corporation, is a cloud-based software and technology company focused on increasing workflow productivity and customer profitability through its enterprise platform of applications and services.

Business Combinations

During 2021, the Company completed three asset acquisitions which were accounted for as business combinations (i) on April 23, 2021, the Company acquired substantially all the assets of Heyns Unlimited LLC doing business as Advantech (ii) on May 31, 2021, the Company acquired substantially all the assets of BCS Tech Center, Inc.; and (iii) on September 1, 2021, the Company acquired substantially all the assets of Spectrum Technology Solutions, LLC.

Going Concern and Liquidity

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates continuity of operations, realization of assets, and liquidation of liabilities in the normal course of business.

For the six months ended June 30, 2023, the Company generated an operating loss of $3,459,646. In addition, at June 30, 2023, the Company has an accumulated deficit, and net working capital deficit of 93,271,716 and $8,759,814 respectively. The Company’s activities were primarily financed through private placements of equity securities and issuance of debt. The Company intends to raise additional capital through the issuance of debt and/or equity securities to fund its operations. The Company is reliant on future fundraising to finance operations in the near future. The financing may not be available on terms satisfactory to the Company, if at all. In light of these matters, there is substantial doubt that the Company will be able to continue as a going concern for a period of 12 months from the issuance date of these financial statements.

Currently, management intends to develop a vastly improved healthcare communications system and intends to develop alliances with strategic partners to generate revenues that will sustain the Company. While management 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. Management’s ability to continue as a going concern is ultimately dependent upon its ability to continually increase the Company’s customer base and realize increased revenues from signed contracts. The financial statements do not include any adjustments related to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

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2. SUMMARY OF SIGNFICANT ACCOUNTING POLICES

Basis of Presentation

The accompanying unaudited condensed financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and in accordance with the instructions to Form 10-Q and Article 8 of Regulation S-X of the SEC. Certain information or footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted, pursuant to the rules and regulations of the SEC for interim financial reporting. Accordingly, they do not include all the information and footnotes necessary for a complete presentation of financial position, results of operations, or cash flows. In the opinion of management, the accompanying unaudited condensed financial statements include all adjustments, consisting of a normal recurring nature, which are necessary for a fair presentation of the financial position, operating results and cash flows for the periods presented.

The accompanying unaudited condensed financial statements should be read in conjunction with the Company’s Annual Report on Form 10-K/A as filed with the SEC on June 16, 2023. The interim results for the six months ended June 30, 2023 are not necessarily indicative of the results to be expected for the year ending December 31, 2023 or for any future periods.

Accounts Receivable and Allowance for Doubtful Accounts

Accounts receivable are customer obligations due under normal trade terms. The Company maintains an allowance for doubtful accounts for estimated losses resulting from the potential inability of certain customers to make required future payments on amounts due. Management determines the adequacy of this allowance by periodically evaluating the aging and past due nature of individual customer accounts receivable balances and considering the customer’s current financial situation as well as the existing industry economic conditions and other relevant factors that would be useful in assessing the risk of collectability. If the future financial condition of the Company’s customers were to deteriorate, resulting in their inability to make specific required payments, additions to the allowance for doubtful accounts may be required. In addition, if the financial condition of customers improves and collections of amounts outstanding commence or are reasonably assured, then the Company may reverse previously established allowances for doubtful accounts. The Company has estimated and recorded an allowance for doubtful accounts of approximately $68,700 at June 30, 2022 and $65,000 December 31, 2022.

Software Development Costs and Acquired Software

The Company accounts for software development costs, including costs to develop software products or the software component of products to be sold to external users. In accordance with ASC 985-730, Computer Software Research and Development, research and planning phase costs are expensed as incurred and development phase costs including direct materials and services, payroll and benefits and interest costs are capitalized.

The Company has determined that technological feasibility for its products to be marketed to external users was reached before the release of those products. As a result, the development costs and related acquisition costs after the establishment of technological feasibility were capitalized as incurred. Capitalized costs for software to be sold to external users and software acquired in a business combination are amortized based on current and projected future revenue for each product with an annual minimum equal to the straight-line amortization over three years.

Long-Lived Assets and Goodwill

The Company accounts for long-lived assets in accordance with the provisions of ASC 360-10-35, Property, Plant and Equipment, Impairment or Disposal of Long-lived Assets. This accounting standard requires that long-lived assets be reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to future undiscounted net cash flows expected to be generated by the asset. If the carrying amount of an asset exceeds its estimated future cash flows, an impairment charge is recognized by the amount by which the carrying amount of the asset exceeds the fair value of the asset. As of June 30, 2023 and December 31, 2022 there was no impairment of Long-lived Assets.

The Company accounts for goodwill and intangible assets in accordance with ASC 350, Intangibles – Goodwill and Other. Goodwill represents the excess of the purchase price of an entity over the estimated fair value of the assets acquired and liabilities assumed. ASC 350 requires that goodwill and other intangibles with indefinite lives be tested for impairment annually or on an interim basis if events or circumstances indicate that the fair value of an asset has decreased below its carrying value. During the fourth quarter of 2020, the Company adopted ASU No. 2017-04, Intangibles – Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment. This guidance simplifies the accounting for goodwill impairment by removing Step 2 of the goodwill impairment test, which requires a hypothetical purchase price allocation. Goodwill impairment will now be the amount by which the carrying value exceeds its fair value, not to exceed the carrying amount of goodwill. As of June 30, 2023 and December 31, 2022 there was no impairment of the Company’s Goodwill.

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Revenue Recognition

We have 6 primary sources of revenue

	1.	Electronic Prescription Software
	2.	Insurance Verifications
	3.	ICD-10 Medical Coding Software
	4.	Encrypted and HIPAA Compliant Secure email
	5.	Analytics
	6.	MSaaS software

1) Electronic Prescription software services are provided an annual subscription basis using the software as a service (‘SaaS’) model with revenue recognized ratably over the contract term.

2). Insurance verification services are provided on an annual subscription basis using SaaS model with revenue recognized ratably over the contract term.

3) ICD-10 Medical Coding services are provided on an annual subscription basis using the software as a SaaS model with revenues recognized ratably over the contract term.

4) Encrypted and HIPAA compliant and secure email services are provided on an annual subscription basis using the SaaS model with revenues recognized ratably over the contract term.

5) Analytics automatically compiles real-time KPI data on an intuitive dashboard which saves time and helps focus the team during the morning huddle. Additionally, the Practice Metrics page provides custom reporting with rich graphics helping management to view revenue, claims, AR, scheduling and more.

6) MSaaS software services are provided on an annual subscription basis using the software as a service (‘SaaS’) model with revenue recognized ratably over the contract term.

The Company accounts for revenue from contracts with customers in accordance with ASU No. 2017-09, Revenue from Contracts with Customers and a series of related accounting standard updates (collectively referred to as “Topic 606”). This guidance sets forth a five-step revenue recognition model which replaced the prior revenue recognition guidance in its entirety and is intended to eliminate numerous industry-specific pieces of revenue recognition guidance and to require more detailed disclosures. The five steps of the revenue recognition model are: (1) identify the contract(s) with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to the performance obligations in the contract; and (5) recognize revenue when (or as) the entity satisfies a performance obligation.

At contract inception, the Company assesses the goods and services promised in the contract with customers and identifies a performance obligation for each. To determine the performance obligation, the Company considers all products and services promised in the contract regardless of whether they are explicitly stated or implied by customary business practices. The timing of satisfaction of the performance obligation is not subject to significant judgment. The Company measures revenue as the amount of consideration expected to be received in exchange for transferring goods and services. Revenue is recognized net of any taxes collected from customers that are subsequently remitted to governmental authorities.

The Company’s customers are acquired through its own salesforce and through the referrals from its many state association marketing partners. The Company primarily generates revenue from multiple software as a service (SaaS) offerings, which typically include subscriptions to its online software solutions. The Company’s secondary source of revenue is professional services and other revenue related to customer onboarding, IT services and equipment sales that often precede a subscription service offering purchased by the customer. Approximately 90% of the Company’s revenue is subscription based with the remainder being professional services and other IT related revenue. The geographic concentration of the Company’s revenue is 100% in North America.

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Management has determined that it has the following performance obligations related to its products and services: multiple SaaS offerings, which typically include subscriptions to our online software solutions. Revenue from Software as a Service, hardware, service repairs, and support & maintenance are all recognized at a point in time when control of the goods is transferred to the customer, generally occurring upon shipment or delivery dependent upon the terms of the underlying contract, or services is completed. Our customers do not have the right to take possession of the online software solution. Revenue from subscriptions, including additional fees for items such as incremental contacts, is recognized ratably over the subscription period beginning on the date the subscription is made available to customers. Substantially all subscription contracts are one year. We recognize revenue from on-boarding services and equipment as the services are provided. Amounts billed that have not yet met the applicable revenue recognition criteria are recorded as deferred revenue.

For contracts with customers that contain multiple performance obligations, the Company accounts for the promised performance obligations separately as individual performance obligations if they are distinct. In determining whether performance obligations meet the criteria for being distinct, the Company considers several factors, including the degree of interrelation and interdependence between obligations and whether or not the good or service significantly modifies or transforms another good or service in the contract. After identifying the separate performance obligations, the transaction price is allocated to the separate performance obligations on a relative standalone selling price basis. The Company generally determines the standalone selling prices based on the prices charged to customers. Judgment may be used to determine the standalone selling prices for items that are not sold separately, including taking into consideration either historical pricing practices or an adjusted market assessment. Unsatisfied and partially unsatisfied performance obligations as of the end of the reporting period primarily consist of products and services for which customer purchase orders have been accepted and that are in the process of being delivered.

Transaction price is calculated as the selling price less any variable consideration, consisting of rebates and discounts. Discounts provided to customers are known at contract inception. Rebates are calculated on the “expected value” method where the Company (1) estimates the probability of each rebate amount which could be earned by the distributor, (2) multiplies each estimated amount by its assigned probability factor, and (3) calculates a final sum of each of the probability-weighted amounts calculated in step (2). The sum calculated in step (3) is the rebate amount, which along with discounts reduces the amount of revenue recognized.

The Company has elected to account for shipping and handling activities that occur after the customer has obtained control of a good as a fulfillment cost rather than as an additional promised service. As a result, the Company accrues the costs of shipping and handling when the related revenue is recognized. Costs incurred for shipping and handling are included in costs of goods sold on the Consolidated Statements of Operations. Amounts billed to a customer for shipping and handling are reported as revenue on the Consolidated Statements of Operations.

Advertising Costs

Advertising costs are reported in selling, general and administrative expenses and include advertising, marketing and promotional programs and are charged as expenses in the year in which they are incurred. Advertising costs were $306,468 and $263,693 for the six months ended June 30, 2023 and 2022, respectively.

Accounting for Derivative Instruments

The Company accounts for derivative instruments in accordance with ASC 815 “Derivatives and Hedging”, which requires additional disclosures about the Company’s objectives and strategies for using derivative instruments, how the derivative instruments and related hedged items are accounted for, and how the derivative instruments and related hedging items affect the financial statements.

The Company does not use derivative instruments to hedge exposures to cash flow, market or foreign currency risk. Terms of convertible debt and preferred stock instruments are reviewed to determine whether or not they contain embedded derivative instruments that are required under ASC 815 to be accounted for separately from the host contract and recorded on the balance sheet at fair value. The fair value of derivative liabilities, if any, is required to be revalued at each reporting date, with corresponding changes in fair value recorded in current period operating results.

Freestanding warrants issued by the Company in connection with the issuance or sale of debt and equity instruments are considered to be derivative instruments. Pursuant to ASC 815, an evaluation of specifically identified conditions is made to determine whether the fair value of warrants issued is required to be classified as equity or as a derivative liability.

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Financial Instruments With Down Round Features

The Company follows the guidance of FASB ASU 2017-11, “Earnings per Share (Topic 260); Distinguishing Liabilities from Equity (Topic 480); and Derivatives and Hedging (Topic 815): (Part I) Accounting for Certain Financial Instruments with Down Round Features. ASU 2017-11 simplifies the accounting for certain financial instruments with down round features, a provision in an equity-linked financial instrument (or embedded feature) that provides a downround adjustment of the current exercise price based on the price of the future equity offerings. The standard requires companies to disregard the down round feature when assessing whether the instrument is indexed to its own stock, for the purposes of determining liability of equity classification. Companies that provide earning per share (“EPS”) data will adjust their diluted EPS calculation for the effect of the feature when triggered (i.e. when the exercise price of the related equity-linked financial instrument is adjusted downward because of the down round feature) and will also recognize the effect of the trigger within equity.

Income Taxes

The Company follows the asset and liability approach to accounting for income taxes. Under this method, deferred tax assets and liabilities are measured based on differences between the financial reporting and tax bases of assets and liabilities measured using enacted tax rates and laws that are expected to be in effect when differences are expected to reverse. Valuation allowances are established when it is necessary to reduce deferred income tax assets to the amount, if any, expected to be realized in future years.

ASC 740, Accounting for Income taxes (“ASC 740”), requires that deferred tax assets be evaluated for future realization and reduced by a valuation allowance to the extent we believe a portion more likely than not will not be realized. We consider many factors when assessing the likelihood of future realization of our deferred tax assets, including our recent cumulative loss experience and expectations of future taxable income by taxing jurisdictions, the carry forwarding periods available to us for tax reporting purposes and other relevant factors.

The Company has not recognized a liability for uncertain tax positions. A reconciliation of the beginning and ending amount of unrecognized tax benefits or penalties has not been provided since there has been no unrecognized benefit or penalty. If there were an unrecognized tax benefit or penalty, the Company would recognize interest accrued related to unrecognized tax benefits in interest expense and penalties in operating expenses. The Company files U.S. Federal income tax returns and various returns in state jurisdictions. The Company’s open tax years subject to examination by the Internal Revenue Service and the state Departments of Revenue generally remain open for three years from the date of filing.

Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting periods. Actual results could differ from those estimates.

Net Loss Per Share

Basic net loss per share is computed by dividing net loss by the weighted average number of shares of Common Stock outstanding for the period. Diluted net loss per share reflects the potential dilution of securities by adding other Common Stock equivalents, including stock options, shares issuable on exercise of warrants, convertible preferred stock and convertible notes in the weighted average number of common shares outstanding for a period, if dilutive. Common stock equivalents that are anti-dilutive were excluded from the computation of diluted earnings per share which consisted of all outstanding common stock options and warrants.

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Stock-Based Compensation

The Company accounts for share-based compensation costs in accordance with ASC 718, Compensation – Stock Compensation. ASC 718 requires companies to measure the cost of awards of equity instruments, including stock options and restricted stock awards, based on the grant-date fair value of the award and to recognize it as compensation expense over the employee’s requisite service period or the non-employee’s vesting period. An employee’s requisite service period is the period of time over which an employee must provide service in exchange for an award under a share-based payment arrangement and generally is presumed to be the vesting period. Upon exercise of share purchase options, the consideration paid by the option holder, together with the amount previously recognized in additional paid in capital, is recorded as an increase to share capital.

The Company estimates the fair value of each option award on the date of grant using a Black-Scholes option pricing model. The Company estimates the fair value of its common stock using the closing stock price of its common stock on the option grant date. The Company estimates the volatility of its common stock at the date of grant based on its historical stock prices. The Company uses the risk-free interest rate on the implied yield currently available on U.S. Treasury issues with an equivalent remaining term approximately equal to the expected life of the award. The Company has never paid any cash dividends on its common stock and does not anticipate paying any cash dividends in the foreseeable future. The fair value of shares of restricted stock issued are determined by the Company based on the estimated fair value of the Company’s common stock.

Beneficial Conversion Features and Warrants

The Company evaluates the conversion feature of convertible debt instruments to determine whether the conversion feature was beneficial as described in ASC 470-30, Debt with Conversion and Other Options. The Company records a beneficial conversion feature (“BCF”) related to the issuance of convertible debt that has conversion features at fixed or adjustable rates that are in-the-money when issued and records the relative fair value of any warrants issued with those instruments. The BCF for the convertible instruments is recognized and measured by allocating a portion of the proceeds to the warrants and as a reduction to the carrying amount of the convertible instrument equal to the intrinsic value of the conversion features, both of which are credited to additional paid-in capital. The Company calculates the fair value of warrants with the convertible instruments using the Black-Scholes valuation model.

Under these guidelines, the Company first allocates the value of the proceeds received from a convertible debt transaction between the convertible debt instrument and any other detachable instruments included in the transaction (such as warrants) on a relative fair value basis. A BCF is then measured as the intrinsic value of the conversion option at the commitment date, representing the difference between the effective conversion price and the Company’s stock price on the commitment date multiplied by the number of shares into which the debt instrument is convertible. The allocated value of the BCF and warrants are recorded as a debt discount and accreted over the expected term of the convertible debt as interest expense. If the intrinsic value of the BCF is greater than the proceeds allocated to the convertible debt instrument, the amount of the discount assigned to the BCF is limited to the amount of the proceeds allocated to the convertible debt instrument.

Leases

The Company adopted ASU No. 2016-02, Leases and a series of related Accounting Standards Updates that followed (collectively referred to as “Topic 842”). Topic 842 requires organizations to recognize right-of-use (“ROU”) lease assets and lease liabilities on the balance sheet and to disclose key information about leasing arrangements. The classification criteria for distinguishing between finance leases and operating leases are substantially similar to the classification criteria for distinguishing between capital leases and operating leases in the previous lease guidance. The FASB retained the distinction between finance leases and operating leases, leaving the effect of leases in the statement of comprehensive income and the statement of cash flows largely unchanged from previous U.S. GAAP. The Company utilized the transition method allowed under ASU 2018-11 in which an entity initially applies the new lease standard at the adoption date and recognizes a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption, if any.

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The Company determines, at contract inception, whether or not an arrangement contains a lease and evaluates the contract for classification as an operating or finance lease. For all leases, ROU assets and lease liabilities are recognized based on the present value of lease payments, including annual rent increases, over the lease term at commencement date. If the Company’s lease does not provide an implicit rate in the contract, the Company uses its incremental, secured borrowing rate based on lease term information available as of the adoption date or lease commencement date in determining the present value of lease payments. Any renewal periods are considered in the analysis of each lease to the extent that the Company considers them to be reasonably certain of being exercised.

Related Party Transactions

The Company accounts for related party transactions in accordance with FASB ASC 850, Related Party Disclosures. A party is considered to be related to the Company if the party directly or indirectly or through one or more intermediaries’ controls, is controlled by, or is under common control with the Company. Related parties also include principal owners of the Company, its management, members of the immediate families of principal owners of the Company and its management and other parties with which the Company may deal if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests. A party which can significantly influence the management or operating policies of the transacting parties or if it has an ownership interest in one of the transacting parties and can significantly influence the other to an extent that one or more of the transacting parties might be prevented from fully pursuing its own separate interests is also a related party.

Reportable Segments

U.S. GAAP establishes standards for reporting financial and descriptive information about a company’s reportable segments. Operating segments are defined as components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker, or decision-making group, in deciding how to allocate resources and in assessing performance. The chief operating decision maker is the Company’s Chief Executive Officer, who currently reviews the financial performance and the results of operations of the Company’s operating subsidiaries on a consolidated basis when making decisions about allocating resources and assessing performance of the Company. Accordingly, the Company currently considers itself to be in a single reporting segment for reporting purposes focused on the North American market.

Allowance for Credit Losses

On January 1, 2023, the Company adopted ASU 2016-13 Financial Instruments —Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (ASC 326). This standard replaced the incurred loss methodology with an expected loss methodology that is referred to as the current expected credit loss (“CECL”) methodology. CECL requires an estimate of credit losses for the remaining estimated life of the financial asset using historical experience, current conditions, and reasonable and supportable forecasts and generally applies to financial assets measured at amortized cost, including loan receivables and held-to-maturity debt securities, and some off-balance sheet credit exposures such as unfunded commitments to extend credit. Financial assets measured at amortized cost will be presented at the net amount expected to be collected.

The Company completed its assessment on the adoption date of the new standard and did not adjust the opening balance of retained earnings relating to its trade receivables. The Company writes off receivables once it is determined that they are no longer collectible, as local laws allow.

Recently Issued Accounting Pronouncements

The Company does not believe that any issued, but not yet effective accounting standards, if currently adopted, will have a material effect on the Company’s financial position, results of operations and cash flows.

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3. NOTES PAYABLE

		June 31,			December 31,
		2023			2022
(1)	Convertible Note bearing interest at 12% due May, 2023		-			578,802
(2)	Note bearing interest at 18% due September 1, 2023		1,250,000			1,012,500
(2)	Note bearing interest at 18% due September 1, 2023		512,500			506,250
(3)	Note bearing interest at 18% due October 1, 2028		32,942			32,752
(4)	Secured Promissory Note bearing interest at 17.5% due February 28, 2026		1,943,390			1,960,965
(5)	Promissory Note bearing interest at 14%, due January 15, 2023		-			50,892
(6)	Promissory Note bearing interest at 14%, due September 1, 2023		350,055			329,227
(7)	Related Party Promissory Note bearing interest at 14% due September 1, 2023		66,293			108,778
(8)	Promissory Note bearing interest at 15%, due January 25, 2023		-			506,370
(9)	Promissory Note bearing interest at 15%, due September 1, 2023		253,082			253,184
(9)	Promissory Note bearing interest at 15%, due September 1, 2023		253,082			253,184
(10)	Related Party Promissory Notes bearing interest at 18%, due March 31, 2023		-			135,888
(11)	Convertible Note bearing interest at 15% due March 2024		2,208,507			-
(7)	Related Party Promissory Note bearing interest at 18%, due September 1, 2023		145,723			-
(12)	Convertible Note bearing interest at 15% due June 14, 2024		77,506			-
(13)	Convertible Note bearing interest at 15% due June 14, 2024		6,039			-
(14)	Related Party Convertible Promissory Note bearing interest at 15% due June 30, 2024		35,000			-
			6,909,119			5,728,792
	Less current maturities		(6,909,119	)		(4,279,531	)
	Total Long-Term Debt	$	-		$	1,449,261

1.	In April 2021, the Company signed a $500,000 convertible promissory note with a maturity date twelve months after issuance and received in exchange $500,000. An interest charge of 12% per annum shall accrue and be paid on the maturity date. The note is convertible into the Company’s Common Stock at a fixed conversion price of $0.10 per common share. The Company has right of prepayment. The note holder is limited to receive upon conversion no more than 4.99% of the issued and outstanding Common Stock at the time of conversion at any one time. The Company also issued to the Holder 788,000 restricted shares of the Company’s Common Stock and a warrant to purchase 2,600,000 shares of Company Common Stock with a 5-year term. The exercise price per share of Common stock under this Warrant is $0.20 per share for the first 1,300,000 Warrant Shares and $0.25 for the next 1,300,000 Warrant Shares. In August 2021 the down round provision in the Warrant Agreement was triggered resulting in an additional 3,250,000 warrants being issued and the strike price repriced to $0.10 for all 5,850,000 warrants. In December 2022, the down round provision in the Warrant Agreement was triggered again resulting in an additional 1,462,500 warrants to be issued and the strike price repriced to $0.08 for all 7,312,500 warrants. At Maturity this note was renegotiated and term extended to June 2023 for an additional principal consideration of $55,400 under the same interest rate and conditions as the matured note. This note and accrued interest was converted in January 2023 for 6,037,883 shares of Common Stock. In May 2023 the Company and the warrant holder renegotiated the outstanding warrants back to their original intended values at issuance date of 1,300,000 exercisable at $0.25 and 1,300,000 exercisable at $0.20.

2.	In August 2021, the Company signed a $1,000,000 and $500,000 promissory note with a maturity date 24 months after issuance. An interest charge of 15% per annum shall accrue and be paid monthly. The Company also issued to the Holder 1,000,000 restricted shares of the Company’s Common Stock and 1,500,000 cash Warrant Shares with a 5-year term. The exercise price per share of Common stock under this Warrant is $0.25 per share. In December 2021 the down round provision in the Warrant Agreement was triggered resulting in an additional 2,250,000 warrants being issued and the strike price repriced to $0.10 for all 3,750,000 warrants. In December 2022 the down round provision in the Warrant Agreement was triggered again resulting in an additional 937,500 warrants being issued and the strike price repriced to $0.10 for all 4,687,500 warrants. In May the Company and the warrant holder renegotiated the outstanding warrants back to their original intended values at issuance date of 1,500,000 exercisable at $0.25. The promissory note is subordinated to the Company’s senior lenders.

3.	In November 2021, the Company signed a $40,071 equipment finance agreement with a maturity date 60 months after issuance from a third-party financing company. Payments of principal and interest of $791 are due monthly.

4.	On February 28, 2022, the Company signed a $2,000,000 secured promissory note with a maturity date 48 months after issuance and received in exchange $1,970,000 net of fees. An Interest charge of 17.5% per annum shall accrue, with interest only payments being made for the first six months after which both interest and principal will be due. The Company has right of prepayment subject to certain minimum interest payments being made. The Prepayment Fee shall be (i) equal to 6 months' interest that would have accrued with regard to the prepaid principal, if prepaid prior to the 2nd anniversary of the date of the Initial Advance or Subsequent Advance, as applicable, and (ii) equal to 3 months' interest that would have accrued with regard to the prepaid principal, if prepaid on or after the 2nd anniversary and prior to the 3rd anniversary of the date of the Initial Advance or Subsequent Advance, as applicable. Additionally, the Company has the following covenant requirements; maintaining a minimum cash balance of $150,000 in its combined bank accounts as well as entering into a Deposit Account Control Agreement; monthly financial reporting requirements and certifications; obtaining other indebtedness without consent; merge, consolidate or transfer assets; pledge assets as collateral; or guarantee without consent of the Lender. As of June 30, 2023, the Company was in default of certain provisions of its $1,943,390 debt obligation. The Company received a waiver of all defaults with a specified grace period through September 1, 2023. The debt is being classified as current, given the uncertainty that the Company cannot ensure compliance is probable or reasonably possible after September 1, 2023.

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5.	In April 2022, the Company signed a $50,000 unsecured promissory note with a maturity date six (6) months after issuance with an interest charge of 14% per annum which shall accrue and be paid on the maturity date. The Company has the right to prepay this note without penalty. At maturity in October 2022, this note was reissued under the same term with a maturity of three (3) months. The promissory note is subordinated to the Company’s senior lender. This note was fully repaid in March 2023.
6.	In April 2022, the Company signed a $300,000 unsecured promissory note with a maturity date six (6) months after issuance with an interest charge of 14% per annum which shall accrue and be paid on the maturity date. The Company has the right to prepay this note without penalty. At maturity in October 2022, this note was reissued under the same terms with a maturity of date of six (6) months. In March 2023, the term of this note was extended to September 1, 2023.The promissory note is subordinated to the Company’s senior lenders.
7	In June 2022, the Company signed a $100,000 unsecured promissory note with related party with a maturity date six (6) months after issuance with an interest charge of 14% per annum which shall accrue and be paid on the maturity date. The Company has the right to prepay this note without penalty. At maturity in November 2022, this note was reissued under the same terms with a maturity of date of three (3) months. The Company also issued to the Holder a warrant to purchase 18,813 shares of Company Common Stock with a 5-year term. The exercise price per share of Common stock under this Warrant is $0.25 per share for 9,407 warrants and $0.20 per share for 9,406 warrants. In March 2023, the term of this note was extended to September 1, 2023. In June 2023 the Company signed a $145,010 unsecured promissory note with the same lender with a maturity date of September 1, 2023 after issuance with an interest rate charge of 18% per annum which shall accrue and be paid on the maturity date. The Company has the right to prepay this note without penalty. The promissory notes are subordinated to the Company’s senior lenders.
8.	In July 2022, the Company signed a $500,000 unsecured promissory note with a maturity date six (6) months after issuance with an interest charge of 14% per annum. The note is callable by the Holder no earlier than 90 days from issue. The Company has the right to prepay this note without penalty. The Company issued to the Holder a warrant to purchase 175,000 shares of Company Common Stock with a 5-year term. The exercise price per share of Common stock under this Warrant is $0.25 per share for 87,500 warrants and $0.20 per share for 87,500 warrants. This note was fully repaid in March 2023.

9.	In August 2022, the Company signed two $250,000 unsecured promissory notes with a maturity date six (6) months after issuance with an interest charge of 14% per annum to the same investor in 14 and 9. The notes are callable by the Holder no earlier than 90 days from issue. The Company has the right to prepay this note without penalty. The Company issued to the Holder a warrant to purchase 175,000 shares of Company Common Stock with a 5-year term. The exercise price per share of Common stock under this Warrant is $0.25 per share for 87,500 warrants and $0.20 per share for 87,500 warrants. In March 2023, the term of these notes were extended to September 1, 2023.The promissory notes are subordinated to the Company’s senior lenders.

10.	In December 2022, the Company entered into an unsecured promissory note with related party in exchange for $55,000. The maturity of the promissory note is four months from the date of issuance and carries an interest rate of 15% per annum. In conjunction with the promissory note, the Company also issued a warrant to purchase 23,625 shares of common stock which expires five years December 15, 2022 and has an exercise price of $0.20 with respect to 11,813 shares underlying the Warrant and $0.25 with respect to 11,812 shares underlying the Warrant. The promissory note is subordinated to the Company’s senior lender. In addition, in December 2022, the Company entered into an unsecured convertible promissory note with the same related party in exchange for $80,000. The maturity of the convertible note is March 31, 2023 and carries an interest rate of 15% per annum and is convertible into Company common stock at a conversion rate of $0.08 per share. The Convertible Note was converted into 1,019,315 shares of Common Stock in January 2023 and the Promissory Note was fully repaid in March 2023.

11.	In March 2023, the Company entered into a twelve (12) month Convertible Secured Promissory Note (“Note”). The Note is for $2,500,000 with $500,000 paid to the Holder on issuance for net proceeds of $2,000,000. The Note carries and interest of 15% per annum which can be paid in cash or kind and it is convertible either into the Company’s Common Stock after six months from date of issuance at $0.10 per share, or if the business combination between FG Merger Corp. (“FGMC”) and the Company pursuant to the Merger Agreement and Plan of Reorganization by and among FGMC, FG Merger Sub Inc., and the Company dated January 5, 2023, as such agreement may be amended from time to time (the “Business Combination”), occurs then, upon any subsequent conversion of the Note, the holder shall no longer have the right to receive Company common stock upon conversion of the Note, but shall have the right to receive, for each share of Company common stock that would have been issuable upon such conversion immediately prior to the occurrence of the Business Combination, the number of shares of FGMC common stock receivable as a result of such Business Combination by a holder of the number of shares of Company common stock for which the Note is convertible immediately prior to such Business Combination. As a condition of the Note all existing outstanding Notes maturing before September 1, 2023 had their term extended to September 1, 2023. In addition, all vested option holders and all warrant holders were provided with a cashless purchase option at time of the Business Combination. The Note is superior to all notes in terms of security except of our Senior Secured Note Payable. In May 2023 all warrant holders with down round provisions provided a waiver to the potential down round triggering event on any conversion issuance.

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12.	In June 2023, the Company entered into a twelve (12) month note Convertible Promissory Note (“Note”). The Note is for $77,000 and carries an interest rate of 15% per annum. The principal of the Note is convertible into Common Stock of the Company at a twenty percent discount to the closing price of the Company’s Common Stock on September 1, 2023 or if the business combination between FG Merger Corp. (“FGMC”) and the Company pursuant to the Merger Agreement and Plan of Reorganization by and among FGMC, FG Merger Sub Inc., and the Company dated January 5, 2023, as such agreement may be amended from time to time (the “Business Combination”), occurs then, upon any subsequent conversion of the Note, the holder shall no longer have the right to receive Company common stock upon conversion of the Note, but shall have the right to receive, for each share of Company common stock that would have been issuable upon such conversion immediately prior to the occurrence of the Business Combination, the number of shares of FGMC common stock receivable as a result of such Business Combination by a holder of the number of shares of Company common stock for which the Note is convertible immediately prior to such Business Combination at a twenty percent discount to such exchange ratio. The promissory note is subordinated to the Company’s senior lenders.

13.	In June 2023, the Company entered into a twelve (12) month note Convertible Promissory Note (“Note”). The Note is for $6,000 and carries an interest rate of 15% per annum. The principal of the Note is convertible into Common Stock of the Company at a twenty percent discount to the closing price of the Company’s Common Stock on September 1, 2023 or if the business combination between FG Merger Corp. (“FGMC”) and the Company pursuant to the Merger Agreement and Plan of Reorganization by and among FGMC, FG Merger Sub Inc., and the Company dated January 5, 2023, as such agreement may be amended from time to time (the “Business Combination”), occurs then, upon any subsequent conversion of the Note, the holder shall no longer have the right to receive Company common stock upon conversion of the Note, but shall have the right to receive, for each share of Company common stock that would have been issuable upon such conversion immediately prior to the occurrence of the Business Combination, the number of shares of FGMC common stock receivable as a result of such Business Combination by a holder of the number of shares of Company common stock for which the Note is convertible immediately prior to such Business Combination at a twenty percent discount to such exchange ratio. The promissory note is subordinated to the Company’s senior lenders.

14.	In June the Company received an advance on a six (6) month Promissory Note (“Note”) in the amount of $35,000. The Note is for $250,000 with $50,000 paid to the Holder on issuance for net proceeds of $200,000. The Note carries an interest of 15% per annum as interest is payable monthly in arrears with principal due at maturity. There is no penalty for early payoff. If an event of default occurs, the Note along with any outstanding and accrued interest is convertible into the Company’s Common Stock at $0.25 at the sole discretion of the issuer. The promissory note is subordinated to the Company’s senior lenders.

4. COMMON STOCK

Stock Issuances

During the six months ended June 30, 2023 the Company issued 5,400,000 shares of common stock for cash of $540,000 and 6,853,335 shares of common stock on the conversion of debt.

Stock Options

Certain employees and executives have been granted options or warrants that are compensatory in nature. A summary of option activity for the six months ended June 30, 2023 are presented below:

Options Outstanding

Number of

Options

Weighted

Average

Exercise Price

Weighted

Average

Remaining

Contractual

Term in

Years

Aggregate

Intrinsic

Value

Balance Outstanding - January 1, 2023

32,235,000

0.13

8.8

Granted

Exercised

Forfeited

Balance Outstanding – June 30, 2023

32,235,000

0.13

8.5

Exercisable – June 30, 2023

9,281,666

0.12

8.1

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Nonvested Options	Number of Options			Weighted Average Grant Date Fair Value		Weighted Average Remaining Years to Vest

Nonvested - January 1, 2023		23,053,334		$	0.12		8.8

Granted		-		$	-		-
Vested		(100,000	)	$	0.12		8.8
Forfeited/expired		-			-		-
Nonvested – June 30, 2022		22,953,334		$	0.12		8.1

Restricted Stock Compensation

On December 31, 2022, the Company’s Board of Directors approved the grant of 250,000 shares of common stock to each of the Directors of the Company, for services rendered during 2021 and 2022, all of which vested on December 31, 2022. Compensation expense related to this grant for the year 2022 was $122,375 based upon fair value of our common stock of $0.089 per share. The Company’s Board of Directors also approved the granting of shares of common stock for employee performance related to 2021 performance with a fair value of $160,645. The Board also approved on January 3, 2023 4,000,000 shares of common stock related to the Chief Executive Officer for bonus related to 2022 service with a fair value of $356,000.

On March 13, 2023 the Company’s Board of Directors approved the grant of 150,000 shares of common stock to certain board members for services related to 2018 service.

In April 2023, the Company’s Board of Directors approved compensation for its Board Members and Committee Members for the year ended December 31, 2023. On an annual basis equivalent, Board Members are compensated $60,000, with additional compensation of $10,000 for being a Committee Member and an additional $10,000 for being a Chair of a Committee. Compensation is to be paid quarterly in arrears at the closing stock price of the last trading day of the quarter. The Company has recorded an expense of $184,167 as of June 30, 2023. In addition the Board of Directors approved the grant of 2,425,000 shares of common stock for employee performance related to 2022 performance with a fair value of $312,761.

Warrants

The Company typically issues warrants to individual investors and institutions to purchase shares of the Company’s Common Stock in connection with public and private placement fundraising activities. Warrants may also be issued to individuals or companies in exchange for services provided for the Company. The warrants are typically exercisable six months after the issue date, expire in five years, and contain a cash exercise provision and registration rights.

In May 2023, the Company entered into amendments with certain warrant holders whose warrants contained down round provisions and modified these warrants to remove such provisions from inception. As such the number and exercise of these warrants are set back to their original values as originally intended by the parties.

During the six months ending June 30, 2023, the Company issued no Common Stock Warrants.

During the six months ending June 30, 2022, the Company issued no Common Stock Warrants. The Company purchased 38,135 common stock warrants issued to a lender in 2019 as part of a Note Payable that had been fully satisfied in 2020. These warrants include anti-dilutive provisions and as such resulted in an additional 861,851 of warrants that were to be issued at a strike price of $0.05. The Company purchased these warrants at their restated strike price for $45,000.

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As of June 30, 2023, the number of shares issuable upon exercise of the Common Stock Warrants were 10,992,438 shares.

Type	Issue Date	Shares		Price		Expiration
Investors	4/19/2021		1,300,000	$	0.20	4/19/2026
Investors	4/19/2021		1,300,000	$	0.25	4/19/2026
Investors	4/22/2021		1,300,000	$	0.20	4/22/2026
Investors	4/22/2021		1,300,000	$	0.25	4/22/2026
Investors	4/30/2021		650,000	$	0.20	4/30/2026
Investors	4/30/2021		650,000	$	0.25	4/30/2026
Investors	5/4/2021		650,000	$	0.20	5/4/2026
Investors	5/4/2021		650,000	$	0.25	5/4/2026
Investors	5/19/2021		650,000	$	0.20	5/19/2026
Investors	5/19/2021		650,000	$	0.25	5/16/2026
Investors	8/31/2021		1,500,000	$	0.25	8/31/2026
Investors	7/29/2022		87,500	$	0.20	7/28/2027
Investors	7/29/2022		87,500	$	0.25	7/28/2027
Investors	8/5/2022		43,750	$	0.20	8/4/2027
Investors	8/5/2022		43,750	$	0.25	8/4/2027
Investors	8/19/2022		43,750	$	0.20	8/18/2027
Investors	8/19/2022		43,750	$	0.25	8/18/2027
Investors	11/28/2022		9,407	$	0.20	11/27/2027
Investors	11/28/2022		9,406	$	0.25	11/27/2027
Investors	12/15/2022		11,812	$	0.20	12/14/2027
Investors	12/15/2022		11,813	$	0.25	12/14/2027
Total			10,992,438

Warrants Outstanding	Number of Warrants			Weighted Average Exercise Price		Weighted Average Remaining Contractual Term in Years		Aggregate Intrinsic Value
Outstanding – December 31, 2022		353,493,766		$	0.10		3.45	$	803,522
Granted		-			-		-		-
Forfeited/expired		(24,356,938	)	$	0.08		3.45		-
Outstanding – June 30, 2023		10,992,438		$	0.23		3.15	$	715,223

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5. GOODWILL AND OTHER INTANGIBLE ASSETS

The following table sets forth the changes in the carrying amount of goodwill for the six months ended June 30, 2023 and year ended December 2022:

	Total
Balance at December 31, 2022	$	1,484,966
2023 Acquisitions		-
Balance at June 30, 2023	$	1,484,966

The following table sets forth the gross carrying amounts and accumulated amortization of the Company’s intangible assets as of June 30, 2023 and December 31, 2022:

	Gross Carrying Amount		Impairment		Accumulated Amortization			Net Carrying Amount
Definite-lived intangible assets:
Capitalized software	$	3,014,490	$	-	$	(2,483,429	)	$	531,061
Customer relationships		3,713,434		-		(1,363,054	)		2,350,380
Acquired technology		1,527,186		-		(1,447,758	)		79,428
Total definite-lived intangible assets at December 31, 2022		8,255,110		-		(5,294,241	)		2,960,869

Capitalized software		3,374,247		-		(2,651,850	)		722,397
Customer relationships		3,713,434		-		(1,722,800	)		1,990,634
Acquired technology		1,527,186		-		(1,489,522	)		37,664
Total definite-lived intangible assets at June 30, 2023	$	8,614,867				(5,864,172	)		2,750,695

Amortization expense of intangible assets was $569,932 and $703,118 for the six months ended June 30, 2023 and 2022, respectively. The Company’s amortization is based on no residual value using the straight-line amortization method as it best represents the benefit of the intangible assets.

6. COMMITMENTS AND CONTINGENCIES

(A) LEASE COMMITMENTS

On November 15, 2017, the Company signed a three-year lease agreement for approximately 4,100 square feet of office space located in Winter Garden, Florida in which the Company has its headquarters. The lease provided for a one-year renewal term at the option of the Company that the company exercised. An amendment to this lease was signed on October 26, 2020 which extended the lease term through October 31, 2021. On September 10, 2021, an additional seven-month extension was signed extending the lease term to May 30, 2022.

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On September 22, 2021, the Company signed a six year and one month lease agreement for approximately 7,650 square feet for its new headquarters commencing on January 1, 2022, located in Ocoee, Florida. The lease provides for a five-year renewal term at the option of the Company In April 2023, the Company entered into a lease agreement with its existing landlord of its Florida location for a lease of an additional 2,295 square feet of space beginning at the earlier of June 1, 2023 or completion of build out for a five year term. As of June 30, 2023 the buildout has not yet been complete.

The Company signed a three-year lease agreement for approximately 2,100 square feet of office space located in Concord, NC on July 16, 2020.

With the acquisition of Advantech, the Company signed a two-year lease on May 12, 2021, for an office in Scottsdale, AZ. In May 2023, the Company extended its lease for an additional 24 months for this location beginning July 1, 2023 under similar terms and conditions as its current lease.

As of June 30, 2022, undiscounted future lease obligations for the office spaces are as follows:

Lease Commitments
as of 06/30/2022
Less than 1 year		1-3 years		3-5 years		Total
$	246,648	$	501,452	$	417,787	$	1,165,887

Lease costs for the six months ended June 30, 2023 were $151,174 and cash paid for amounts included in the measurement of lease liabilities for the six months ended June 30, 2022 were $159,098. As of June 30, 2023, the following represents the difference between the remaining undiscounted lease commitments under non-cancelable leases and the lease liabilities:

Undiscounted minimum lease commitments	$	1,165,887
Present value adjustment using incremental borrowing rate		(274,499	)
Lease liabilities	$	891,388

(B) LITIGATION

On February 21, 2023, the Company received a notice under section 21 of Indian Arbitration and Conciliation Act, 1996 related to a dispute pursuant to a contract between the Company and a service provider, pursuant to which the service provider has asserted the Company has violated the terms of the contract and has claimed damages of approximately $635,000. The Company is evaluating the claims asserted against it and intends to defend itself vigorously in these proceedings; however, there can be no assurances that it will be successful in its efforts. The outcome of this matter is not expected to have a material effect on these financial statements.

(C) GUARANTEE

In May 2023 the Company agreed to guarantee the repayment of up to $400,000 in non-interest-bearing unsecured notes of FG Merger Corp. in the event that the merger between FG Merger Corp and the Company did not get completed by September 1, 2023.

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7. CONCENTRATION OF CREDIT RISK

Financial instruments that potentially subject the Company to concentrations of credit risk consist of cash and trade accounts receivables. The Company places its cash with high-credit-quality financial institutions. At times, such cash may be in excess of the Federal Deposit Insurance Corporation (“FDIC”) insurance coverage limit of $250,000 per depositor. As a result, there could be a concentration of credit risk related to amounts on deposit in excess of FDIC insurance coverage. The Company has not experienced any losses due to these excess deposits and believes the risk is not significant. With respect to trade receivables, management routinely assesses the financial strength of its customers and, as a consequence, believes that the receivable credit risk exposure is limited.

The Company has historically provided financial terms to customers in accordance with what management views as industry norms. Access to the Company’s software products usually requires immediate payment but can extend several months under certain circumstances. Management periodically and regularly reviews customer account activity in order to assess the adequacy of allowances for doubtful accounts, considering such factors as economic conditions and each customer’s payment history and creditworthiness. If the financial condition of our customers were to deteriorate, or if they were otherwise unable to make payments in accordance with management’s expectations, we might have to increase our allowance for doubtful accounts, modify their financial terms and/or pursue alternative collection methods.

The Company has no significant customers (greater than 10% of total revenue) in its six-month 2023 revenue. The Company has accounts receivable concentration with three customers in 2022 representing 59% of total accounts receivables outstanding as of June 30, 2023, and one customer that represented 31% of accounts receivable outstanding as of December 31, 2022.

8. SEGMENT INFORMATION

The Company views its operations and manages its business as one operating segment which is the business of providing subscription-based software as a service (SaaS) and Managed IT (MSP/MSaaS) services and related non-recurring professional IT and other services. The Company aggregates is operating segments based on similar economic and operating characteristics of its operations.

The Company’s SaaS and Managed IT offerings are sold under monthly recurring revenue contracts are included in the Subscription software and services segment. Professional services and other revenue segment consists of non-recurring revenue, including the periodic sale and installation of IT related hardware and custom IT projects. Professional services and other revenue is recognized when services are performed.

Revenue type were as follows:

	For the Three Months Ended June 30
	2023		%			2022		%			% Change
Revenue:
Subscription software and services	$	1,629,999		88	%	$	1,814,273		90	%	(10		%)

Professional services and other		226,149		12	%		196,888		10	%		15	%

	$	1,856,148		100	%	$	2,011,161		100	%	(9		%)

	For the Six Months Ended June 30
	2023		%			2022		%			% Change
Revenue:
Subscription software and services	$	3,333,814		90	%	$	3,671,092		91	%	(9	%)

Professional services and other		362,705		10	%		383,958		9	%	(11	%)

	$	3,696,519		100	%	$	4,055,050		100	%	(9	%)

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9. RELATED PARTY TRANSACTIONS

The Company incurred related party transactions of $60,318 for the three months ended March 31, 2023, and $407,309 for the three months ended March 31, 2022, in relation to payments of interest and principal on Notes Payable with its Chief Executive Officer. These notes were fully repaid in February 2022 and March 2023 respectively. In June 2023, the Company received an advance payment of $35,000 on a $250,000 Promissory Note from a related party to the Chief Executive Officer. This promissory note bears interest of 15% per annum and is due monthly with the principal due at maturity. Net proceeds from the Note will be $200,000 with $50,000 paid to the issuer on closing.

In June 2022 the Company entered into a $100,000 promissory note with its Chief Operating Officer. The promissory note has a maturity date of six (6) months after issuance with an interest charge of 14% per annum which shall accrue and be paid on the maturity date. This note was extended to September 1, 2023. The Company has the right to prepay this note without penalty. Accrued but unpaid interest as of June, 2023, was $16,293. In June 2023 the Chief Operating Officer entered into an additional Promissory Note maturing September 1,2023 in the amount of $145,010 bearing 18% per annum with interest and principal due at Maturity. The Company has the right to prepay this note without penalty. Accrued but unpaid interest as of June 30, 2023 was $713.

10. SUBSEQUENT EVENTS

In July 2023, the Company entered into a twelve (12) month note Convertible Promissory Note (“Note”). The Note is for $40,000 and carries an interest rate of 15% per annum. The principal of the Note is convertible into Common Stock of the Company at a twenty percent discount to the closing price of the Company’s Common Stock on September 1, 2023 or if the business combination between FG Merger Corp. (“FGMC”) and the Company pursuant to the Merger Agreement and Plan of Reorganization (the “Merger Agreement”) by and among FGMC, FG Merger Sub Inc., and the Company dated January 5, 2023, as such agreement may be amended from time to time (the “Business Combination”), occurs then, upon any subsequent conversion of the Note, the holder shall no longer have the right to receive Company common stock upon conversion of the Note, but shall have the right to receive, for each share of Company common stock that would have been issuable upon such conversion immediately prior to the occurrence of the Business Combination, the number of shares of FGMC common stock receivable as a result of such Business Combination by a holder of the number of shares of Company common stock for which the Note is convertible immediately prior to such Business Combination at a twenty percent discount to such exchange ratio. The promissory note is subordinated to the Company’s senior lenders.

On July 27, 2023 the Company held a Special Meeting of Stockholders to approve its business combination between FG Merger Corp. (“FGMC”) and the Company pursuant to the Merger Agreement. The Business Combination was approved by the majority of the Shareholders and is now subject to, among other items set forth in the Merger Agreement, approval from FGMC Shareholders on August 11, 2023.

In July 2023 the Company issued 1,305,697 shares of common stock related to accrued compensation for its Board of Directors for their services in quarter 1 and quarter 2 of 2023.

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Statements made in this Quarterly Report on Form 10-Q, including without limitation this Management’s Discussion and Analysis of Financial Condition and Results of Operations, other than statements of historical information, are forward looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements may be identified by such words as “may,” “will,” “expect,” “anticipate,” “believe,” “estimate” and “continue” or similar words. We believe it is important to communicate our future expectations to investors. However, these forward-looking statements involve many risks and uncertainties, including the risk factors disclosed under the heading “Risk Factors” included in the Company’s Form 10-K/A filed with the Securities and Exchange Commission (“SEC”) on June 16, 2023 and under the heading entitled “Going Concern” in the “Notes to Condensed Consolidated Financial Statements” in Part I of this Quarterly Report on Form 10-Q. Our actual results could differ materially from those indicated in such forward-looking statements as a result of certain factors. We are under no duty to update any of the forward-looking statements after the date of this Report on Form 10-Q to conform these statements to actual results, other than to comply with the federal securities laws.

About the Company

Company History

The Company is a cloud-based software and technology company focused on increasing workflow productivity and customer profitability through its enterprise platform of applications and services.

Software as a Service (SaaS) Offerings

The Company currently markets secure Health Insurance Portability and Accountability Act (HIPAA) compliant cloud-based software as a service (SaaS) offering under the names of iCoreRx, iCorePDMP, iCoreEPCS, iCoreVerify, iCoreVerify+, iCoreHuddle, iCoreHuddle+, iCoreCodeGenius, iCoreExchange, iCoreCloud, iCorePay, iCoreSecure, and iCoreIT. The Company’s software is sold under annual recurring revenue subscriptions.

iCoreRx – iCoreRx is a HIPAA compliant electronic prescription SaaS solution that integrates with popular practice management and electronic health record systems. It saves time by selecting exact medications at available doses with built-in support from a drug directory and provides full support for Electronic Prescriptions for Controlled Substances (iCoreEPCS). It protects both the patient and provider by viewing the patient’s complete medication history. It also speeds up the process by allowing the doctor to create a “favorites” list for commonly used medication sets.

iCorePDMP is an add-on for iCoreRx that seamlessly integrates with state databases to automate prescription drug monitoring. Providers in many states are required to check the patient’s Prescription Drug Monitoring Program (PDMP) history before prescribing controlled substances. This service provides one-click real-time access to the state databases without the need to manually enter data. This tool also generates patient risk scores and an interactive visualization of usage patterns to help the prescriber identify potential risk factors. The prescriber can then use this report to make decisions on objective insight into potential drug misuse or abuse which will ultimately lead to improved patient safety and better patient outcomes.

iCoreVerify and iCoreVerify+ - iCoreVerify is a HIPAA compliant SaaS solution that automatically retrieves a patients insurance eligibility breakdown to verify their benefits seven (7) days in advance of their appointment and on-demand using iCoreConnect’s real time technology. Automation runs daily to verify insurance every patient on the schedule a full week in advance of their appointment date. The system returns results typically in less than one second for most responses. This substantially reduces the phone calls and labor hours for the practice. This tool integrates with most popular practice management systems. iCoreVerify+ adds a unique add-on service that augments iCoreConnect’s automation with a concierge service that turns around requests traditionally in less than 24 hours. It includes all carriers including non-digital ones and is customized to the client's specialty.

iCoreHuddle and iCoreHuddle+ – iCoreHuddle is a powerful HIPAA compliant SaaS solution to instantly reveal the revenue potential of each patient. This product is currently limited to dental practices. The service connects to most popular practice management and electronic health record systems to optimize revenue realization. It provides the practice with a dashboard containing various metrics, analytics, and key performance indicators (“KPIs”). iCoreHuddle provides a daily view of patient schedules, including their outstanding balances, unscheduled treatment plans, recall information, procedure information and the amount of remaining insurance benefits. The software also provides one-click access to each patient’s insurance eligibility, including a detailed benefits and deductibles report. This tool aims to increase the workflow efficiency of the dentist’s practice by reducing the number of required lookups and clicks for each patient. iCoreHuddle+ offers enhanced analytical tools for practices to optimize their revenue generation process and workflows.

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iCoreCodeGenius – iCoreCodeGenius is a medical coding reference SaaS solution that provides the coding standards for the 10th revision of the International Classification of Diseases and Related Health Problems (ICD-10), a medical classification list published by the World Health Organization (WHO). It contains codes for diseases, signs and symptoms, abnormal findings, complaints, social circumstances, and external causes of injury and diseases.

iCoreExchange – iCoreExchange provides a secure, HIPAA compliant SaaS email solution using the direct protocol that allows doctors to send and receive secure email with attachments to and from other healthcare professionals in the network. iCoreExchange also provides a secure email mechanism to communicate with users outside the exchange e.g., patients and referrals. Users have the ability to build a community, access other communities and increase referrals and collaboration. Users can email standard office documents, JPEG, PDF as well as patient files with discrete data, which can then be imported and accessed on most Electronic Health Record (EHR) and Practice Management (PM) systems in a HIPAA compliant manner.

iCoreCloud - iCoreCloud offers customers the ability to backup their on-premise servers and computers to the cloud. iCoreCloud is a fully HIPAA compliant and automated backup solution. The data backed up is encrypted both in transit and while at rest. In case of full data loss, the mirrored data in the cloud can be seamlessly restored back to the practice on a new computer or a server. The data is stored encrypted in HIPAA compliant data centers with multiple layers of redundancy. The data centers are physically secure with restricted personnel and biometric access. The locations are also guarded by security 24 hours a day, 365 days a year.

iCorePay – iCorePay offers a seamless patient payment processing solutions for customers. iCorePay integrates into the practice workflow for payment and revenue cycle tracking.

iCoreSecure –We used our expertise and development capabilities from our HIPAA compliant iCoreExchange and developed iCoreSecure, an encrypted email solution for anyone that needs encrypted email to protect personal and financial data. iCoreSecure is a secure SaaS solution that solves privacy concerns in the insurance, real estate, financial and many other industry sectors that have a need for secure encrypted email.

iCoreIT - The trend in IT Services companies for over a decade has been to move away from a “Break/Fix '' model to a “Managed Service Provider (MSP)” and “Managed Software as a Service (MSaaS)” model with recurring revenue.

Managed IT Services (MSP and MSaaS)

The MSP/MSaaS approach, by using preventative measures, keeps computers and networks up and running while data is accessible and safeguarded. Installation of critical patches and updates to virus protection are automated. Systems are monitored and backed up in real-time. They are fixed or upgraded before they cause a service disruption. A Unified Threat Management solution is deployed to protect against virus, malware, SPAM, phishing and ransomware attacks. Remote technical support is a click away. All support is delivered at a predictable monthly cost.

By leveraging managed services with our expertise in cloud computing, our customers can scale their business without extensive capital investment or disruption in services.

We derive most of our revenue from subscriptions to our cloud-based SaaS and MSaaS offerings. Subscription revenue related to SaaS and MSaaS offerings account for 88% and 90% of our total revenue for the three months ended June 30, 2023 and 2022, respectively. We sell multiple offerings at different base prices on a subscription basis to meet the needs of the customers we serve.

Professional services and other revenue account for 12% and 10% of our total revenue for the three months ended March 31, 2023 and 2022, respectively. Professional services and other revenue include hardware, software, labor, and other revenues related to customer onboarding for SaaS/MSaaS services or one-time, non-recurring services. We expect professional services and other margins to range from moderately positive to break-even.

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COVID-19 Business Update

In the first quarter of 2021, we began to see the impact of the COVID-19 pandemic on our business, as local and national actions, such as stay at home mandates and business closures, took effect. Our core customers, medical and dental businesses, significantly curtailed business operations, impacting the Company’s sales and near-term new business prospects.

In May 2021 the Company received loan proceeds of $328,000 relating to the Paycheck Protection Program (PPP) as part of the CARES Act created by Congress to financially support companies during the COVID-19 pandemic. The PPP Loan carried interest at 1%. The principal and accrued interest were forgiven on June 14, 2021, after completing and submitting a PPP Loan Forgiveness Application with the financial institution associated with the SBA loan.

Business activity at our customers is returning to more normalized operating conditions. Our sales efforts and prospects have sequentially improved for several quarters in a row as the pandemic subsided and we have returned to a higher rate of organic growth compared to the first half of 2021.

Financing

We are currently funding our business capital requirements through sales of our common stock and debt arrangements. While we intend to seek additional funding, if revenue increases to a point where we are able to sustain ourselves and increase our budget to match our growth needs, we may significantly reduce the amount of investment capital we seek. The amount of funds raised, and revenue generated, if any, will determine how aggressively we can grow and what additional projects we will be able to undertake. No assurance can be given that we will be able to raise additional capital when needed or at all, or that such capital, if available, will be on terms acceptable to us. If we are unable to, or do not raise additional capital in the near future or if our revenue does not begin to grow as we expect, we will have to curtail our spending and downsize our operations.

Critical Accounting Policies and Estimates

Our discussion and analysis of financial condition and results of operations are based upon the financial statements, which have been prepared in accordance with generally accepted accounting principles as recognized in the United States of America. The preparation of these financial statements requires that we make estimates and judgments that affect the reported amounts of assets, liabilities, revenue and expenses, and disclosure of contingent assets and liabilities. We base our estimates on historical experience and on various other assumptions that management believes to be reasonable under the circumstances. Actual results may differ from these estimates under different assumptions or conditions.

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We believe that the most critical accounting policies relate to revenue recognition, software development capitalization and amortization, income taxes, stock-based compensation, and long-lived assets and goodwill. See Note 2 to the condensed consolidated financial statements.

Executive Summary

Financial Results for the Six Months Ended June 30, 2023

Our total revenue for the six months ended June 30, 2023, decreased by 9% to $3.697 million compared with $4.055 million during the same period in 2022. The Company continued to show the impact of a decrease in services revenues from the mild attrition it incurred in Q1 2023, while recurring revenues also decreased in the comparative period due to changes in legislation that pushed out several state eprescription mandates that went into effect in Q1 2022 resulting in attrition in the back half of 2022. The Company continues to see organic growth in its SaaS based products. The Company ended the quarter with over approximately 32,000 subscriptions on our platform up from approximately 24,000 subscriptions in the prior year period.

The Company views its operations and manages its business as one operating segment which is the business of providing subscription-based software as a service (SaaS), Managed IT (MSaaS) and related non-recurring professional IT and other services. The Company aggregates is operating segments based on similar economic and operating characteristics of its operations.

Gross profit percentage was 74% and 69% for the six months ended June 30, 2023 and 2022, respectively. Gross Profit decreased by $79K compared to the same period a year ago. Gross profit margin expansion was driven by a greater growth rate of sales in subscription software and services that carry higher gross margins than Professional Services and other revenue. We expect the growth rate of our SaaS and MSaaS subscription offerings to grow faster than our Professional Services and other revenue over time. We believe the higher growth rate of recurring revenue SaaS and MSaaS offerings should continue to provide a mix shift that will benefit gross margin rate going forward.

Business Highlights and Trends

	·	Product Traction. We continue to benefit from trends toward cloud-based SaaS offerings for improved workflow, productivity, and efficiency gains. As we have expanded our product offerings, we are seeing greater traction for all our software products across the entire platform.

	·	Business Development. The Company has pursued and won contracts with larger enterprise health care businesses and continues to do so. We currently have agreements with large State Associations, Dental Support Organizations (DSOs), Hospitals, and large insurance companies

	·	Capital raise. In the first six months of 2023, the company raised $540,000 from the sale of common stock and $2,263,010 in gross proceeds in the form of secured notes, convertible notes and notes payable to fund operations and growth.

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Results of Operations - Three and Six Month Period Ended June 30, 2023 Compared to Three and Six Month Period Ended June 30, 2022

Overview. The following table sets forth our selected financial data for the periods indicated below and the percentage dollar increase (decrease) of such items from period to period:

Three Month Period Ended June 30, 2023 Compared to the Three Month Period Ended June 30, 2022

	Three Months Ended
	June 30,			June 30,
	2023			2022			% Incr/(Decr)
Revenue	$	1,856,148		$	2,011,161		(8		%)
Cost of sales		484,033			621,283		(22		%)
Gross profit		1,372,115			1,389,878

Expenses
Selling, general and administrative		3,189,103			2,261,577			41	%
Depreciation and amortization		291,600			340,245		(14		%)
Total operating expenses		3,480,703			2,601,822
Loss from operations		(2,108,588	)		(1,211,944	)

Other income (expense)
Interest expense		(270,770	)		(189,183	)		43	%
Finance charges		(342,015	)		(86,000	)		298	%
Other income		13,778			-			100	%
Total other expense, net		(599,007	)		(275,183	)		118	%

Net loss	$	(2,707,595	)	$	(1,487,127	)		82	%

Revenues. Net revenues decreased to $1.9MM from $2.0MM for the three months ended June 30, 2023 and 2022, respectively. The decrease in revenue was primarily drive by client attrition as a few of the Company’s larger MSP customers were acquired by larger corporations, who brought these services in house at the beginning of 2023.

Cost of sales. Cost of sales for the three months ended June 30, 2023 and 2022 decreased to $0.5MM compared to $0.6MM respectively. The decrease between periods was due primarily to a decrease in labor costs and subscriptions related to Professional Services and Other revenues which incurred some attrition at the beginning of the year. The Company has been able to add on customers to both Subscription Software and Services and Professional Services and Other Revenues at a lower cost.

Selling, general and administrative expenses. Selling, general and administrative expenses for the three months ended June 30, 2023 and 2022 were $3.2MM and $2.3MM, respectively. The increase between periods was primarily due to an increase in payroll expenses and other general and administrative expenses to support the rate of growth as well as the additional cost incurred to support the build out of the Company’s iCoreClaims product line.

Depreciation and amortization expenses. Depreciation and amortization expenses for the three months ended June 30, 2023 and 2022 were $0.3MM and $0.3MM, respectively. The difference between periods was primarily the result of lower capitalization of assets subject to depreciation in the three months ended June 30, 2023 compared to the three months ended June 30, 2022.

Interest Expense. Interest expense for the three months ended June 30, 2023 and 2022 was $$0.3MM and $0.2MM, respectively. The increase between periods was primarily due the Company taking on additional bridge debt for growth and operations during the first quarter of 2023

Financing fee. Financing fee expenses for the three months ended June 30, 2023 and 2022 were $0.3MM and $$0.1MM respectively. The increase between periods was primarily due to the Company taking on additional bridge debt for growth and operations during the first quarter of 2023.

Other income. Other income for the three months ended June 30, 2023 and 2022 were $0.01MM and $nil, respectively. Other income in 2023 consisted of the net proceeds from sale of capital assets.

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Six Month Period Ended June 30, 2023 Compared to Six Month Period Ended June 30, 2022

	Six Months Ended
	June 30,			June 30,			%
	2023			2022			Incr/(Decr)
Revenue	$	3,696,519		$	4,055,050		(9		%)
Cost of sales		975,482			1,255,513		(22		%)
Gross profit		2,721,037			2,799,537

Expenses
Selling, general and administrative		5,600,174			4,293,934			30	%
Depreciation and amortization		580,509			714,100		(19		%)
Total operating expenses		6,180,683			5,008,034
Loss from operations		(3,459,646	)		(2,208,497	)

Other income (expense)
Interest expense		(528,683	)		(344,872	)		53	%
Finance charges		(422,078	)		(386,000	)		9	%
Other income (expense)		13,778			(89,993	)	(115		%)
Total other expense, net		(936,983	)		(820,865	)		14	%

Net loss	$	(4,396,629	)	$	(3,029,362	)		45	%

Revenues. Net revenues for the six months ended June 30, 2023 decreased to $3.7MM compared to $4.1MM for six months ended June 30, 2022.

Revenues from Subscription Software and Services decreased slightly to $3.3MM from $3.7MM, respectively, due to ePrescription mandates which took effect in Q1 2022 and were subsequently altered to not being required based on number of prescriptions written or delayed enforcement until sometime in 2023 resulting in cancellations in the mid half of 2022. The Company made the decision to allow some customers to exit their contracts early in order to assist in an orderly compliance of the new enforcement dates with the idea that the Company could gain the customer back in the latter half of 2023. Professional Services and Other revenues increased to $0.38MM from $0.14MM, respectively due to net client gains during the period.

Cost of sales. Cost of sales for the six months ended June 30, 2023 and 2022 decreased to $0.98MM compared to $1.3MM respectively. The decrease between periods was due primarily to a decrease in labor costs and subscriptions related to Professional Services and Other revenues which incurred some attrition at the beginning of the year. The Company has been able to add on customers to both Subscription Software and Services and Professional Services and Other Revenues at a lower cost.

Selling, general and administrative expenses. Selling, general and administrative expenses for the six months ended June 30, 2023 and 2022 were $5.6MM and $4.3MM, respectively. The increase between periods was primarily due to an increase in payroll expenses and other general and administrative expenses to support a high rate of growth.

Depreciation and amortization expenses. Depreciation and amortization expenses for the six months ended June 30, 2023 and 2022 were $0.3MM and $0.4MM, respectively. The decrease between periods was primarily the result of lower capitalization of assets subject to depreciation in the six months ended June 30, 2023 compared to the six months ended June 30, 2022.

Interest Expense. Interest expense for the six months ended June 30, 2023, and 2022 was $0.53MM and $0.34MM, respectively. The increase between periods was primarily due the Company taking on additional bridge debt for growth and operations during the first quarter of 2023.

Financing fee. Financing fee expenses for the six months ended June 30, 2023 and 2022 were $0.42MM and $0.34MM respectively. The expenses are related to the issuance of convertible debt features in 2023 and warrants and convertible feature of the convertible debt issued in the second quarter of 2021.

Other income (expense). Other income (expense) consists of cost related to the payment of sales and use tax filings for prior periods as well as settlement of a prior periods accounts payable for Q2 2022 compared to income related to the sale of company assets in Q2 2023.

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LIQUIDITY AND CAPITAL

For the six-month period ended June 30, 2023 the Company generated an operating loss of $3,459,646. In addition, the Company has an accumulated deficit, total stockholders’ deficit and net working capital deficit of $93,271,716, and $8,759,814, respectively. The Company’s activities were primarily financed through private placements of equity securities and issuance of debt. The Company intends to raise additional capital through the issuance of debt and/or equity securities to fund its operations, although there is no assurance that it will be successful in raising any additional capital. The Company is reliant on future fundraising to finance operations in the near future. . In light of these matters, there is substantial doubt that the Company will be able to continue as a going concern for a period of 12 months from the issuance date of these financial statements.

Management continues to develop strategic partnerships and has ramped up selling into the existing customer base as well as penetrate larger organizations with multiple customers while continuing to scope out additional areas of opportunity. While management 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. Management’s ability to continue as a going concern is ultimately dependent upon its ability to continually increase the Company’s customer base and realize increased revenues from signed contracts. The financial statements do not include any adjustments related to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

The primary factors that influence our liquidity include, but are not limited to, the amount and timing of our equity and debt raises, revenues, cash collections from our clients, capital expenditures, and investments in research and development.

The following table summarizes the impact of operating, investing and financing activities on our cash flows for the six-month periods ended June 30, 2023 and 2022 related to our operations:

	Six Month Ended
	June 30,			June 30,
	2023			2022
Net cash used in operating activities	$	(1,919,630	)	$	(1,434,944	)
Net cash used in investing activities		(509,908	)		(129,898	)
Net cash provided by financing activities		2,302,120			1,657,296
Net change in cash		(127,418	)		92,454
Cash and cash equivalents at beginning of the period		196,153			71,807
Cash and cash equivalents at end of the period	$	68,735		$	164,261

Operating Activities: Net cash used by operating activities of $1.9MM for six-month period ended June 30, 2023 was $0.6MM more than the $1.4MM cash used by operations for the six-month period ended June 30, 2022. The increase in cash utilized by operating activities compared to the six-month period ended June 30, 2022 was primarily attributable to a larger net loss period on period, offset by an increase in accounts payable of $0.4MM. Future spending on operating activities is expected to be funded by the sale of and issuance of additional shares of common stock.

Investing Activities: Net cash used by investing activities was $0.5MM for the six-month period ended June 30, 2023 compared to $0.13MM cash used by investing activities for the six -month period ended June 30, 2022. The overall increase was mainly due to increases in capitalized software during the six months ended June 30, 2023. Future spending on investing activities is expected to be funded by the sale of and issuance of additional shares of common stock.

Financing Activities: Net cash provided by financing activities of $2.3MM for the six-month period ended June 30, 2023 was $0.6MM more than the $1.7MM cash provided by financing activities for the six-month period ended June 30, 2022. The Company issued $2.3MM in net debt proceeds for the six-months ended June 30, 2023 versus $2.4MM for the same comparative period in 2022. The Company also converted $0.7MM of convertible debt in to equity for the six months ended June 30, 2023 in comparison to $0.02MM for the same comparable period in 2022.

Table of Contents

Credit Facilities

In January 2021 the Company and one of its Convertible Debt Holders entered into a Purchase Agreement for up to $5,000,000 of the Company’s common stock for 24 months. The purchase price of the stock will be at 75% of the lowest individual daily weight average price of the past five (5) trading days with the amount to be drawn down as the lesser of $250,000 or 300% of the average shares traded for the ten (10) days prior to the Closing Request Date with a minimum $25,000 put allowance. As part of the agreement, the Company issued 250,000 shares of common stock as a commitment fee. The facility expired in January 2023.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISKS

Not applicable.

ITEM 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

Disclosure controls and procedures are designed to ensure that information required to be disclosed by us in our Exchange Act reports is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure.

Under the supervision and with the participation of our management, including our Chief Executive Officer (our principal executive officer) and Chief Financial Officer (our principal financial and accounting officer), we conducted an evaluation of the effectiveness of our disclosure controls and procedures as of the end of the fiscal quarter ended June 30, 2023, as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act. Based on this evaluation, our principal executive officer and principal financial and accounting officer have concluded that during the period covered by this report, our disclosure controls and procedures were not effective, due to the material weakness related to the Company’s accounting for complex financial instruments and the material weakness related to our inability to adequately segregate responsibilities over the financial reporting process. In addition, management has further identified deficiencies within its corporate governance practices, as the Company did not have the necessary controls in place to understand the impact on equity holders and monitor the issuance of instruments with down round features. Considering these material weaknesses, we performed additional procedures and analyses as deemed necessary to ensure that our financial statements were prepared in accordance with U.S. generally accepted accounting principles.

Notwithstanding the material weaknesses, management has concluded that the financial statements included elsewhere in this Quarterly Report present fairly, in all material respects, our financial position, results of operations and cash flows in conformity with GAAP.

Changes to Internal Control Over Financial Reporting

We have not identified any change in our internal control over financial reporting during our most recently completed fiscal quarter that materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

Table of Contents

PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

The Company from time to time, may be a party to various litigation, claims and disputes, arising in the ordinary course of business. While the ultimate impact of such actions cannot be predicted with certainty, we believe the outcome of these matters, except for that noted below, will not have a material adverse effect on our financial condition or results of operations.

On February 21, 2023, the Company received a notice under section 21 of Indian Arbitration and Conciliation Act, 1996 related to a dispute pursuant to contract between the Company and a service provider, pursuant to which the service provider has asserted the Company has violated the terms of the contract and has claimed damages of approximately $635,000. The Company is evaluating the claims asserted against it and intends to defend itself vigorously in these proceedings; however, there can be no assurances that it will be successful in its efforts.

ITEM 1A. RISK FACTORS

Factors that could cause our actual results to differ materially from those in this report include the risk factors described in our Annual Report on Form 10-K/A filed with the SEC. As of the date of this Quarterly Report, there have been no material changes to the risk factors disclosed in our Annual Report on Form 10-K filed with the SEC.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

Information with respect to sales of unregistered shares of the Common Stock of the Company during the fiscal quarter ended June 30, 2023, is set forth in the Condensed Statements of Changes in Stockholders’ Equity (Deficit) for the Six Months Ended June 30, 2023 and 2022 (Unaudited) contained in Part I Financial Information. All such sales were to accredited investors and were made in reliance on Section 4(a)(2) of the Securities Act of 1933, as amended. The proceeds were used by the Company for working capital purposes.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

Not applicable.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

ITEM 5. OTHER INFORMATION

Not applicable.

Table of Contents

ITEM 6. EXHIBITS

Exhibit No.		Description
10.1		Promissory Note between iCoreConnect Inc. and Jeffrey Stellinga dated June 14, 2023
10.2		Convertible Promissory Note between iCoreConnect Inc. and Christa Maclean. dated June 14, 2023
10.3		Convertible Promissory Note between iCoreConnect Inc. and Christina Dixon dated June 14, 2023
10.4		Convertible Promissory Note between iCoreConnect Inc. and Robosmasher Inc. dated June 30, 2023
10.5		Promissory Note between iCoreConnect Inc. and Jeffrey Stellinga dated July 3, 2023
10.6		Convertible Promissory Note between iCoreConnect Inc. and David and Jennifer Maclean dated July 24, 2023
31.1 *		Certification of Principal Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2 *		Certification of Principal Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1 *+		Certification of Principal Executive Officer Pursuant to Section 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2 *+		Certification of Principal Financial Officer Pursuant to Section 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS		Inline XBRL Instance Document (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document).
101.SCH		Inline XBRL Taxonomy Extension Schema Document.
101.CAL		Inline XBRL Taxonomy Extension Calculation Linkbase Document.
101.DEF		Inline XBRL Taxonomy Extension Definition Linkbase Document.
101.LAB		Inline XBRL Taxonomy Extension Labels Linkbase Document.
101.PRE		Inline XBRL Taxonomy Extension Presentation Linkbase Document.
104		Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101).

_____________

* Filed herewith.

** Certain exhibits and schedules to this Exhibit have been omitted in accordance with Regulation S-K Item 601(a)(5). The Company agrees to furnish supplementally a copy of all omitted exhibits and schedules to the Securities and Exchange Commission upon its request.

+ The certifications on Exhibit 32 hereto are deemed not “filed” for purposes of Section 18 of the Exchange Act or otherwise subject to the liability of that Section. Such certifications will not be deemed incorporated by reference into any filing under the Securities Act or the Exchange Act.

Table of Contents

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

iCoreConnect, Inc. (Registrant)

Date: August 14, 2023	By:	/s/ Robert McDermott
		Robert McDermott
		Chief Executive Officer
		(Principal Executive Officer)

Date: August 14, 2023	By:	/s/ Archit Shah
		Archit Shah
		Chief Financial Officer
		(Principal Accounting Officer)

nullnullnullnullnullnullnullnullnullnull

Cover - shares	6 Months Ended
Cover - shares	Jun. 30, 2023	Aug. 14, 2023
Cover [Abstract]
Entity Registrant Name	iCoreConnect Inc.
Entity Central Index Key	0001408057
Document Type	10-Q
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Small Business	true
Entity Shell Company	false
Entity Emerging Growth Company	false
Entity Current Reporting Status	Yes
Document Period End Date	Jun. 30, 2023
Entity Filer Category	Non-accelerated Filer
Document Fiscal Period Focus	Q2
Document Fiscal Year Focus	2023
Entity Common Stock Shares Outstanding		197,454,470
Document Quarterly Report	true
Document Transition Report	false
Entity File Number	000-52765
Entity Incorporation State Country Code	NV
Entity Tax Identification Number	13-4182867
Entity Address Address Line 1	529 E. Crown Point Road
Entity Address Address Line 2	Suite 250
Entity Address City Or Town	Ocoee
Entity Address State Or Province	FL
City Area Code	888
Local Phone Number	810-7706
Entity Interactive Data Current	Yes
Entity Address Postal Zip Code	34761

CONDENSED BALANCE SHEETS - USD ($)	Jun. 30, 2023	Dec. 31, 2022
CONDENSED BALANCE SHEETS
Cash	$ 68,735	$ 196,153
Accounts receivable, net	365,940	414,809
Prepaid expenses and other current assets	684,655	480,706
Total current assets	1,119,330	1,091,668
Property and equipment, net	199,989	74,194
Right of use lease asset - operating	853,039	944,487
Software development costs, net	722,397	531,061
Acquired technology, net	37,664	79,428
Customer relationships, net	1,990,634	2,350,380
Goodwill	1,484,966	1,484,966
Total long-term assets	5,288,689	5,464,516
TOTAL ASSETS	6,408,019	6,556,184
LIABILITIES AND STOCKHOLDERS' DEFICIT
Accounts payable and accrued expenses	2,745,951	2,336,174
Operating lease liability, current portion	135,935	169,417
Notes payable, current portion	6,909,118	4,279,531
Deferred revenue	88,140	13,847
Total current liabilities	9,879,144	6,798,969
Long-term debt, net of current maturities	0	1,449,261
Operating lease liability, net of current portion	755,453	809,458
Total long-term liabilities	755,453	2,258,719
TOTAL LIABILITIES	10,634,597	9,057,688
STOCKHOLDERS' DEFICIT
Preferred Stock, par value $0.001; 10,000,000 shares authorized; Issued and Outstanding: 0 as of June 30, 2023 and December 31, 2022	0	0
Common Stock par value $0.001; 600,000,000 shares authorized; Issued and Outstanding: 196,148,863 as of June 30, 2023 and 181,320,528 as of December 31, 2022	196,149	181,321
Additional paid-in-capital	88,848,989	86,192,262
Accumulated deficit	(93,271,716)	(88,875,087)
TOTAL STOCKHOLDERS' DEFICIT	(4,226,578)	(2,501,504)
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT	$ 6,408,019	$ 6,556,184

CONDENSED BALANCE SHEETS (Parenthetical) - $ / shares	Jun. 30, 2023	Dec. 31, 2022
CONDENSED BALANCE SHEETS
Preferred stock, shares par value	$ 0.001	$ 0.001
Preferred stock, shares authorized	10,000,000	10,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares Outstanding	0	0
Common stock, shares par value	$ 0.001	$ 0.001
Common stock, shares authorized	600,000,000	600,000,000
Common stock, shares issued	196,148,863	181,320,528
Common stock, shares Outstanding	196,148,863	181,320,528

CONDENSED STATEMENTS OF OPERATIONS (UNAUDITED) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
CONDENSED STATEMENTS OF OPERATIONS (UNAUDITED)
Revenue, net	$ 1,856,148	$ 2,011,161	$ 3,696,519	$ 4,055,050
Cost of sales	484,033	621,283	975,482	1,255,513
Gross profit	1,372,115	1,389,878	2,721,037	2,799,537
Expenses
Selling, general and administrative	3,189,103	2,261,577	5,560,174	4,293,934
Depreciation and amortization	291,600	340,245	580,509	714,100
Total operating expenses	3,480,703	2,601,822	6,180,683	5,008,034
Loss from operations	(2,108,588)	(1,211,944)	(3,459,646)	(2,208,497)
Other income (expense)
Interest expense	(270,770)	(189,183)	(528,683)	(344,872)
Finance charges	(342,015)	(86,000)	(422,078)	(386,000)
Other income (expenses)	13,778	0	13,778	(89,993)
Total other expense, net	(599,007)	(275,183)	(936,983)	(820,865)
Net loss	$ (2,707,595)	$ (1,487,127)	$ (4,396,629)	$ (3,029,362)
Net loss per share available to common stockholders, basic and diluted	$ (0.01)	$ (0.01)	$ (0.02)	$ 0.02
Weighted average number of shares, basic and diluted	195,976,705	172,353,044	193,417,289	171,723,963

CONDENSED STATEMENTS OF CHANGES IN STOCKHOLDERS DEFICIT (UNAUDITED) - USD ($)	Total	Common Stock	Additional Paid-In Capital	Accumulated Deficit
Balance, shares at Dec. 31, 2021		167,493,497
Balance, amount at Dec. 31, 2021	$ 1,005,291	$ 167,493	$ 83,633,061	$ (82,795,263)
Stock issued for cash, shares		4,722,844
Stock issued for cash, amount	350,000	$ 4,723	345,277	0
Finance fee on convertible debt	300,000		300,000
Stock compensation expense	255,697	0	255,697	0
Net loss	(1,542,235)	$ 0	0	(1,542,235)
Balance, shares at Mar. 31, 2022		172,216,323
Balance, amount at Mar. 31, 2022	368,753	$ 172,216	84,534,035	(84,337,498)
Balance, shares at Dec. 31, 2021		167,493,497
Balance, amount at Dec. 31, 2021	1,005,291	$ 167,493	83,633,061	(82,795,263)
Net loss	(3,029,362)
Balance, shares at Jun. 30, 2022		172,473,691
Balance, amount at Jun. 30, 2022	(782,427)	$ 172,473	84,869,725	(85,824,625)
Balance, shares at Mar. 31, 2022		172,216,323
Balance, amount at Mar. 31, 2022	368,753	$ 172,216	84,534,035	(84,337,498)
Finance fee on convertible debt	86,000		86,000
Net loss	(1,487,127)			(1,487,127)
Stock issued for conversion of debt, shares		227,368
Stock issued for conversion of debt, amount	22,387	$ 227	22,160
Stock compensation expense, shares		30,000
Stock compensation expense, amount	272,560	$ 30	272,530
Repurchase of common stock warrants	45,000		45,000
Balance, shares at Jun. 30, 2022		172,473,691
Balance, amount at Jun. 30, 2022	(782,427)	$ 172,473	84,869,725	(85,824,625)
Balance, shares at Dec. 31, 2022		181,320,528
Balance, amount at Dec. 31, 2022	(2,501,504)	$ 181,321	86,192,262	(88,875,087)
Stock issued for cash, shares		5,400,000
Stock issued for cash, amount	540,000	$ 5,400	534,600
Finance fee on convertible debt	80,063		80,063
Net loss	(1,689,034)			(1,689,034)
Stock issued for conversion of debt, shares		7,057,198
Stock issued for conversion of debt, amount	685,333	$ 7,057	678,276
Stock compensation expense, shares		150,000
Stock compensation expense, amount	272,983	$ 150	272,833
Balance, shares at Mar. 31, 2023		193,927,726
Balance, amount at Mar. 31, 2023	(2,612,159)	$ 193,928	87,758,034	(90,564,121)
Balance, shares at Dec. 31, 2022		181,320,528
Balance, amount at Dec. 31, 2022	(2,501,504)	$ 181,321	86,192,262	(88,875,087)
Net loss	(4,396,629)
Balance, shares at Jun. 30, 2023		196,148,863
Balance, amount at Jun. 30, 2023	(4,226,578)	$ 196,149	88,848,989	(93,271,716)
Balance, shares at Mar. 31, 2023		193,927,726
Balance, amount at Mar. 31, 2023	(2,612,159)	$ 193,928	87,758,034	(90,564,121)
Finance fee on convertible debt	342,015		342,015
Net loss	(2,707,595)			(2,707,595)
Stock issued for conversion of debt, shares		(203,863)
Stock issued for conversion of debt, amount	0	$ (204)	204
Stock compensation expense, shares		2,425,000
Stock compensation expense, amount	751,161	$ 2,425	748,736
Balance, shares at Jun. 30, 2023		196,148,863
Balance, amount at Jun. 30, 2023	$ (4,226,578)	$ 196,149	$ 88,848,989	$ (93,271,716)

CONDENSED STATEMENTS OF CASH FLOWS (UNAUDITED) - USD ($)	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss	$ (4,396,629)	$ (3,029,362)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation expense	10,577	10,981
Amortization expense	569,932	703,118
Finance fee	422,078	386,000
Change in allowance for doubtful accounts	110,520	137,676
Gain on sale of assets	13,778	0
Stock compensation expense	1,024,144	528,257
Non-cash interest expense	103,539	82,804
Changes in operating assets and liabilities:
Accounts receivable	(61,651)	(210,502)
Prepaid expenses and other current assets	(203,949)	(87,673)
Right of use asset, net of lease liability	3,961	22,833
Accounts payable and accrued expenses	409,777	15,946
Deferred revenue	74,293	(20,419)
NET CASH USED IN OPERATING ACTIVITIES	(1,919,630)	(1,434,944)
INVESTING ACTIVITIES
Sale of capital assets	28,000	0
Purchase of capital assets	(178,150)	0
Additions to capitalized software	(359,758)	(129,898)
NET CASH USED IN INVESTING ACTIVITIES	(509,908)	(129,898)
FINANCING ACTIVITES
Net proceeds from debt	2,263,010	2,420,000
Payments on debt	(1,186,223)	(1,112,591)
Proceeds from issuance of common stock	540,000	350,000
Purchase of common stock warrants	0	(22,500)
Stock issued for conversion of convertible debt	685,333	22,387
NET CASH PROVIDED BY FINANCING ACTIVITIES	2,302,120	1,657,296
NET CHANGE IN CASH	(127,418)	92,454
CASH AT BEGINNING OF THE PERIOD	196,153	71,807
CASH AT END OF THE PERIOD	68,735	164,261
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid during the period for interest	$ 348,941	$ 301,644

NATURE OF OPERATIONS

6 Months Ended

Jun. 30, 2023

NATURE OF OPERATIONS

NATURE OF OPERATIONS

1. NATURE OF OPERATIONS

Business Combinations

Going Concern and Liquidity

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

6 Months Ended

Jun. 30, 2023

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

2. SUMMARY OF SIGNFICANT ACCOUNTING POLICES

Basis of Presentation

Accounts Receivable and Allowance for Doubtful Accounts

Software Development Costs and Acquired Software

Long-Lived Assets and Goodwill

Revenue Recognition

We have 6 primary sources of revenue

	1.	Electronic Prescription Software
	2.	Insurance Verifications
	3.	ICD-10 Medical Coding Software
	4.	Encrypted and HIPAA Compliant Secure email
	5.	Analytics
	6.	MSaaS software

1) Electronic Prescription software services are provided an annual subscription basis using the software as a service (‘SaaS’) model with revenue recognized ratably over the contract term.

2). Insurance verification services are provided on an annual subscription basis using SaaS model with revenue recognized ratably over the contract term.

3) ICD-10 Medical Coding services are provided on an annual subscription basis using the software as a SaaS model with revenues recognized ratably over the contract term.

4) Encrypted and HIPAA compliant and secure email services are provided on an annual subscription basis using the SaaS model with revenues recognized ratably over the contract term.

6) MSaaS software services are provided on an annual subscription basis using the software as a service (‘SaaS’) model with revenue recognized ratably over the contract term.

Advertising Costs

Accounting for Derivative Instruments

Financial Instruments With Down Round Features

Income Taxes

Use of Estimates

Net Loss Per Share

Stock-Based Compensation

Beneficial Conversion Features and Warrants

Leases

Related Party Transactions

Reportable Segments

Allowance for Credit Losses

Recently Issued Accounting Pronouncements

NOTES PAYABLE

6 Months Ended

Jun. 30, 2023

NOTES PAYABLE

NOTES PAYABLE

3. NOTES PAYABLE

		June 31,			December 31,
		2023			2022
(1)	Convertible Note bearing interest at 12% due May, 2023		-			578,802
(2)	Note bearing interest at 18% due September 1, 2023		1,250,000			1,012,500
(2)	Note bearing interest at 18% due September 1, 2023		512,500			506,250
(3)	Note bearing interest at 18% due October 1, 2028		32,942			32,752
(4)	Secured Promissory Note bearing interest at 17.5% due February 28, 2026		1,943,390			1,960,965
(5)	Promissory Note bearing interest at 14%, due January 15, 2023		-			50,892
(6)	Promissory Note bearing interest at 14%, due September 1, 2023		350,055			329,227
(7)	Related Party Promissory Note bearing interest at 14% due September 1, 2023		66,293			108,778
(8)	Promissory Note bearing interest at 15%, due January 25, 2023		-			506,370
(9)	Promissory Note bearing interest at 15%, due September 1, 2023		253,082			253,184
(9)	Promissory Note bearing interest at 15%, due September 1, 2023		253,082			253,184
(10)	Related Party Promissory Notes bearing interest at 18%, due March 31, 2023		-			135,888
(11)	Convertible Note bearing interest at 15% due March 2024		2,208,507			-
(7)	Related Party Promissory Note bearing interest at 18%, due September 1, 2023		145,723			-
(12)	Convertible Note bearing interest at 15% due June 14, 2024		77,506			-
(13)	Convertible Note bearing interest at 15% due June 14, 2024		6,039			-
(14)	Related Party Convertible Promissory Note bearing interest at 15% due June 30, 2024		35,000			-
			6,909,119			5,728,792
	Less current maturities		(6,909,119	)		(4,279,531	)
	Total Long-Term Debt	$	-		$	1,449,261

1.	In April 2021, the Company signed a $500,000 convertible promissory note with a maturity date twelve months after issuance and received in exchange $500,000. An interest charge of 12% per annum shall accrue and be paid on the maturity date. The note is convertible into the Company’s Common Stock at a fixed conversion price of $0.10 per common share. The Company has right of prepayment. The note holder is limited to receive upon conversion no more than 4.99% of the issued and outstanding Common Stock at the time of conversion at any one time. The Company also issued to the Holder 788,000 restricted shares of the Company’s Common Stock and a warrant to purchase 2,600,000 shares of Company Common Stock with a 5-year term. The exercise price per share of Common stock under this Warrant is $0.20 per share for the first 1,300,000 Warrant Shares and $0.25 for the next 1,300,000 Warrant Shares. In August 2021 the down round provision in the Warrant Agreement was triggered resulting in an additional 3,250,000 warrants being issued and the strike price repriced to $0.10 for all 5,850,000 warrants. In December 2022, the down round provision in the Warrant Agreement was triggered again resulting in an additional 1,462,500 warrants to be issued and the strike price repriced to $0.08 for all 7,312,500 warrants. At Maturity this note was renegotiated and term extended to June 2023 for an additional principal consideration of $55,400 under the same interest rate and conditions as the matured note. This note and accrued interest was converted in January 2023 for 6,037,883 shares of Common Stock. In May 2023 the Company and the warrant holder renegotiated the outstanding warrants back to their original intended values at issuance date of 1,300,000 exercisable at $0.25 and 1,300,000 exercisable at $0.20.

2.	In August 2021, the Company signed a $1,000,000 and $500,000 promissory note with a maturity date 24 months after issuance. An interest charge of 15% per annum shall accrue and be paid monthly. The Company also issued to the Holder 1,000,000 restricted shares of the Company’s Common Stock and 1,500,000 cash Warrant Shares with a 5-year term. The exercise price per share of Common stock under this Warrant is $0.25 per share. In December 2021 the down round provision in the Warrant Agreement was triggered resulting in an additional 2,250,000 warrants being issued and the strike price repriced to $0.10 for all 3,750,000 warrants. In December 2022 the down round provision in the Warrant Agreement was triggered again resulting in an additional 937,500 warrants being issued and the strike price repriced to $0.10 for all 4,687,500 warrants. In May the Company and the warrant holder renegotiated the outstanding warrants back to their original intended values at issuance date of 1,500,000 exercisable at $0.25. The promissory note is subordinated to the Company’s senior lenders.

3.	In November 2021, the Company signed a $40,071 equipment finance agreement with a maturity date 60 months after issuance from a third-party financing company. Payments of principal and interest of $791 are due monthly.

4.	On February 28, 2022, the Company signed a $2,000,000 secured promissory note with a maturity date 48 months after issuance and received in exchange $1,970,000 net of fees. An Interest charge of 17.5% per annum shall accrue, with interest only payments being made for the first six months after which both interest and principal will be due. The Company has right of prepayment subject to certain minimum interest payments being made. The Prepayment Fee shall be (i) equal to 6 months' interest that would have accrued with regard to the prepaid principal, if prepaid prior to the 2nd anniversary of the date of the Initial Advance or Subsequent Advance, as applicable, and (ii) equal to 3 months' interest that would have accrued with regard to the prepaid principal, if prepaid on or after the 2nd anniversary and prior to the 3rd anniversary of the date of the Initial Advance or Subsequent Advance, as applicable. Additionally, the Company has the following covenant requirements; maintaining a minimum cash balance of $150,000 in its combined bank accounts as well as entering into a Deposit Account Control Agreement; monthly financial reporting requirements and certifications; obtaining other indebtedness without consent; merge, consolidate or transfer assets; pledge assets as collateral; or guarantee without consent of the Lender. As of June 30, 2023, the Company was in default of certain provisions of its $1,943,390 debt obligation. The Company received a waiver of all defaults with a specified grace period through September 1, 2023. The debt is being classified as current, given the uncertainty that the Company cannot ensure compliance is probable or reasonably possible after September 1, 2023.

5.	In April 2022, the Company signed a $50,000 unsecured promissory note with a maturity date six (6) months after issuance with an interest charge of 14% per annum which shall accrue and be paid on the maturity date. The Company has the right to prepay this note without penalty. At maturity in October 2022, this note was reissued under the same term with a maturity of three (3) months. The promissory note is subordinated to the Company’s senior lender. This note was fully repaid in March 2023.
6.	In April 2022, the Company signed a $300,000 unsecured promissory note with a maturity date six (6) months after issuance with an interest charge of 14% per annum which shall accrue and be paid on the maturity date. The Company has the right to prepay this note without penalty. At maturity in October 2022, this note was reissued under the same terms with a maturity of date of six (6) months. In March 2023, the term of this note was extended to September 1, 2023.The promissory note is subordinated to the Company’s senior lenders.
7	In June 2022, the Company signed a $100,000 unsecured promissory note with related party with a maturity date six (6) months after issuance with an interest charge of 14% per annum which shall accrue and be paid on the maturity date. The Company has the right to prepay this note without penalty. At maturity in November 2022, this note was reissued under the same terms with a maturity of date of three (3) months. The Company also issued to the Holder a warrant to purchase 18,813 shares of Company Common Stock with a 5-year term. The exercise price per share of Common stock under this Warrant is $0.25 per share for 9,407 warrants and $0.20 per share for 9,406 warrants. In March 2023, the term of this note was extended to September 1, 2023. In June 2023 the Company signed a $145,010 unsecured promissory note with the same lender with a maturity date of September 1, 2023 after issuance with an interest rate charge of 18% per annum which shall accrue and be paid on the maturity date. The Company has the right to prepay this note without penalty. The promissory notes are subordinated to the Company’s senior lenders.
8.	In July 2022, the Company signed a $500,000 unsecured promissory note with a maturity date six (6) months after issuance with an interest charge of 14% per annum. The note is callable by the Holder no earlier than 90 days from issue. The Company has the right to prepay this note without penalty. The Company issued to the Holder a warrant to purchase 175,000 shares of Company Common Stock with a 5-year term. The exercise price per share of Common stock under this Warrant is $0.25 per share for 87,500 warrants and $0.20 per share for 87,500 warrants. This note was fully repaid in March 2023.

9.	In August 2022, the Company signed two $250,000 unsecured promissory notes with a maturity date six (6) months after issuance with an interest charge of 14% per annum to the same investor in 14 and 9. The notes are callable by the Holder no earlier than 90 days from issue. The Company has the right to prepay this note without penalty. The Company issued to the Holder a warrant to purchase 175,000 shares of Company Common Stock with a 5-year term. The exercise price per share of Common stock under this Warrant is $0.25 per share for 87,500 warrants and $0.20 per share for 87,500 warrants. In March 2023, the term of these notes were extended to September 1, 2023.The promissory notes are subordinated to the Company’s senior lenders.

10.	In December 2022, the Company entered into an unsecured promissory note with related party in exchange for $55,000. The maturity of the promissory note is four months from the date of issuance and carries an interest rate of 15% per annum. In conjunction with the promissory note, the Company also issued a warrant to purchase 23,625 shares of common stock which expires five years December 15, 2022 and has an exercise price of $0.20 with respect to 11,813 shares underlying the Warrant and $0.25 with respect to 11,812 shares underlying the Warrant. The promissory note is subordinated to the Company’s senior lender. In addition, in December 2022, the Company entered into an unsecured convertible promissory note with the same related party in exchange for $80,000. The maturity of the convertible note is March 31, 2023 and carries an interest rate of 15% per annum and is convertible into Company common stock at a conversion rate of $0.08 per share. The Convertible Note was converted into 1,019,315 shares of Common Stock in January 2023 and the Promissory Note was fully repaid in March 2023.

11.	In March 2023, the Company entered into a twelve (12) month Convertible Secured Promissory Note (“Note”). The Note is for $2,500,000 with $500,000 paid to the Holder on issuance for net proceeds of $2,000,000. The Note carries and interest of 15% per annum which can be paid in cash or kind and it is convertible either into the Company’s Common Stock after six months from date of issuance at $0.10 per share, or if the business combination between FG Merger Corp. (“FGMC”) and the Company pursuant to the Merger Agreement and Plan of Reorganization by and among FGMC, FG Merger Sub Inc., and the Company dated January 5, 2023, as such agreement may be amended from time to time (the “Business Combination”), occurs then, upon any subsequent conversion of the Note, the holder shall no longer have the right to receive Company common stock upon conversion of the Note, but shall have the right to receive, for each share of Company common stock that would have been issuable upon such conversion immediately prior to the occurrence of the Business Combination, the number of shares of FGMC common stock receivable as a result of such Business Combination by a holder of the number of shares of Company common stock for which the Note is convertible immediately prior to such Business Combination. As a condition of the Note all existing outstanding Notes maturing before September 1, 2023 had their term extended to September 1, 2023. In addition, all vested option holders and all warrant holders were provided with a cashless purchase option at time of the Business Combination. The Note is superior to all notes in terms of security except of our Senior Secured Note Payable. In May 2023 all warrant holders with down round provisions provided a waiver to the potential down round triggering event on any conversion issuance.

12.	In June 2023, the Company entered into a twelve (12) month note Convertible Promissory Note (“Note”). The Note is for $77,000 and carries an interest rate of 15% per annum. The principal of the Note is convertible into Common Stock of the Company at a twenty percent discount to the closing price of the Company’s Common Stock on September 1, 2023 or if the business combination between FG Merger Corp. (“FGMC”) and the Company pursuant to the Merger Agreement and Plan of Reorganization by and among FGMC, FG Merger Sub Inc., and the Company dated January 5, 2023, as such agreement may be amended from time to time (the “Business Combination”), occurs then, upon any subsequent conversion of the Note, the holder shall no longer have the right to receive Company common stock upon conversion of the Note, but shall have the right to receive, for each share of Company common stock that would have been issuable upon such conversion immediately prior to the occurrence of the Business Combination, the number of shares of FGMC common stock receivable as a result of such Business Combination by a holder of the number of shares of Company common stock for which the Note is convertible immediately prior to such Business Combination at a twenty percent discount to such exchange ratio. The promissory note is subordinated to the Company’s senior lenders.

13.	In June 2023, the Company entered into a twelve (12) month note Convertible Promissory Note (“Note”). The Note is for $6,000 and carries an interest rate of 15% per annum. The principal of the Note is convertible into Common Stock of the Company at a twenty percent discount to the closing price of the Company’s Common Stock on September 1, 2023 or if the business combination between FG Merger Corp. (“FGMC”) and the Company pursuant to the Merger Agreement and Plan of Reorganization by and among FGMC, FG Merger Sub Inc., and the Company dated January 5, 2023, as such agreement may be amended from time to time (the “Business Combination”), occurs then, upon any subsequent conversion of the Note, the holder shall no longer have the right to receive Company common stock upon conversion of the Note, but shall have the right to receive, for each share of Company common stock that would have been issuable upon such conversion immediately prior to the occurrence of the Business Combination, the number of shares of FGMC common stock receivable as a result of such Business Combination by a holder of the number of shares of Company common stock for which the Note is convertible immediately prior to such Business Combination at a twenty percent discount to such exchange ratio. The promissory note is subordinated to the Company’s senior lenders.

14.	In June the Company received an advance on a six (6) month Promissory Note (“Note”) in the amount of $35,000. The Note is for $250,000 with $50,000 paid to the Holder on issuance for net proceeds of $200,000. The Note carries an interest of 15% per annum as interest is payable monthly in arrears with principal due at maturity. There is no penalty for early payoff. If an event of default occurs, the Note along with any outstanding and accrued interest is convertible into the Company’s Common Stock at $0.25 at the sole discretion of the issuer. The promissory note is subordinated to the Company’s senior lenders.

COMMON STOCK

6 Months Ended

Jun. 30, 2023

COMMON STOCK

COMMON STOCK

4. COMMON STOCK

Stock Issuances

During the six months ended June 30, 2023 the Company issued 5,400,000 shares of common stock for cash of $540,000 and 6,853,335 shares of common stock on the conversion of debt.

Stock Options

Certain employees and executives have been granted options or warrants that are compensatory in nature. A summary of option activity for the six months ended June 30, 2023 are presented below:

Options Outstanding

Number of

Options

Weighted

Average

Exercise Price

Weighted

Average

Remaining

Contractual

Term in

Years

Aggregate

Intrinsic

Value

Balance Outstanding - January 1, 2023

32,235,000

0.13

8.8

Granted

Exercised

Forfeited

Balance Outstanding – June 30, 2023

32,235,000

0.13

8.5

Exercisable – June 30, 2023

9,281,666

0.12

8.1

Nonvested Options	Number of Options			Weighted Average Grant Date Fair Value		Weighted Average Remaining Years to Vest

Nonvested - January 1, 2023		23,053,334		$	0.12		8.8

Granted		-		$	-		-
Vested		(100,000	)	$	0.12		8.8
Forfeited/expired		-			-		-
Nonvested – June 30, 2022		22,953,334		$	0.12		8.1

Restricted Stock Compensation

On March 13, 2023 the Company’s Board of Directors approved the grant of 150,000 shares of common stock to certain board members for services related to 2018 service.

Warrants

During the six months ending June 30, 2023, the Company issued no Common Stock Warrants.

As of June 30, 2023, the number of shares issuable upon exercise of the Common Stock Warrants were 10,992,438 shares.

Type	Issue Date	Shares		Price		Expiration
Investors	4/19/2021		1,300,000	$	0.20	4/19/2026
Investors	4/19/2021		1,300,000	$	0.25	4/19/2026
Investors	4/22/2021		1,300,000	$	0.20	4/22/2026
Investors	4/22/2021		1,300,000	$	0.25	4/22/2026
Investors	4/30/2021		650,000	$	0.20	4/30/2026
Investors	4/30/2021		650,000	$	0.25	4/30/2026
Investors	5/4/2021		650,000	$	0.20	5/4/2026
Investors	5/4/2021		650,000	$	0.25	5/4/2026
Investors	5/19/2021		650,000	$	0.20	5/19/2026
Investors	5/19/2021		650,000	$	0.25	5/16/2026
Investors	8/31/2021		1,500,000	$	0.25	8/31/2026
Investors	7/29/2022		87,500	$	0.20	7/28/2027
Investors	7/29/2022		87,500	$	0.25	7/28/2027
Investors	8/5/2022		43,750	$	0.20	8/4/2027
Investors	8/5/2022		43,750	$	0.25	8/4/2027
Investors	8/19/2022		43,750	$	0.20	8/18/2027
Investors	8/19/2022		43,750	$	0.25	8/18/2027
Investors	11/28/2022		9,407	$	0.20	11/27/2027
Investors	11/28/2022		9,406	$	0.25	11/27/2027
Investors	12/15/2022		11,812	$	0.20	12/14/2027
Investors	12/15/2022		11,813	$	0.25	12/14/2027
Total			10,992,438

Warrants Outstanding	Number of Warrants			Weighted Average Exercise Price		Weighted Average Remaining Contractual Term in Years		Aggregate Intrinsic Value
Outstanding – December 31, 2022		353,493,766		$	0.10		3.45	$	803,522
Granted		-			-		-		-
Forfeited/expired		(24,356,938	)	$	0.08		3.45		-
Outstanding – June 30, 2023		10,992,438		$	0.23		3.15	$	715,223

GOODWILL AND OTHER INTANGIBLE ASSETS

6 Months Ended

Jun. 30, 2023

GOODWILL AND OTHER INTANGIBLE ASSETS

GOODWILL AND OTHER INTANGIBLE ASSETS

5. GOODWILL AND OTHER INTANGIBLE ASSETS

The following table sets forth the changes in the carrying amount of goodwill for the six months ended June 30, 2023 and year ended December 2022:

	Total
Balance at December 31, 2022	$	1,484,966
2023 Acquisitions		-
Balance at June 30, 2023	$	1,484,966

The following table sets forth the gross carrying amounts and accumulated amortization of the Company’s intangible assets as of June 30, 2023 and December 31, 2022:

	Gross Carrying Amount		Impairment		Accumulated Amortization			Net Carrying Amount
Definite-lived intangible assets:
Capitalized software	$	3,014,490	$	-	$	(2,483,429	)	$	531,061
Customer relationships		3,713,434		-		(1,363,054	)		2,350,380
Acquired technology		1,527,186		-		(1,447,758	)		79,428
Total definite-lived intangible assets at December 31, 2022		8,255,110		-		(5,294,241	)		2,960,869

Capitalized software		3,374,247		-		(2,651,850	)		722,397
Customer relationships		3,713,434		-		(1,722,800	)		1,990,634
Acquired technology		1,527,186		-		(1,489,522	)		37,664
Total definite-lived intangible assets at June 30, 2023	$	8,614,867				(5,864,172	)		2,750,695

COMMITMENTS AND CONTINGENCIES

6 Months Ended

Jun. 30, 2023

COMMITMENTS AND CONTINGENCIES

COMMITMENTS AND CONTINGENCIES

6. COMMITMENTS AND CONTINGENCIES

(A) LEASE COMMITMENTS

The Company signed a three-year lease agreement for approximately 2,100 square feet of office space located in Concord, NC on July 16, 2020.

As of June 30, 2022, undiscounted future lease obligations for the office spaces are as follows:

Lease Commitments
as of 06/30/2022
Less than 1 year		1-3 years		3-5 years		Total
$	246,648	$	501,452	$	417,787	$	1,165,887

Undiscounted minimum lease commitments	$	1,165,887
Present value adjustment using incremental borrowing rate		(274,499	)
Lease liabilities	$	891,388

(B) LITIGATION

(C) GUARANTEE

CONCENTRATION OF CREDIT RISK

6 Months Ended

Jun. 30, 2023

CONCENTRATION OF CREDIT RISK

CONCENTRATION OF CREDIT RISK

7. CONCENTRATION OF CREDIT RISK

SEGMENT INFORMATION

6 Months Ended

Jun. 30, 2023

SEGMENT INFORMATION

SEGMENT INFORMATION

8. SEGMENT INFORMATION

Revenue type were as follows:

	For the Three Months Ended June 30
	2023		%			2022		%			% Change
Revenue:
Subscription software and services	$	1,629,999		88	%	$	1,814,273		90	%	(10		%)

Professional services and other		226,149		12	%		196,888		10	%		15	%

	$	1,856,148		100	%	$	2,011,161		100	%	(9		%)

	For the Six Months Ended June 30
	2023		%			2022		%			% Change
Revenue:
Subscription software and services	$	3,333,814		90	%	$	3,671,092		91	%	(9	%)

Professional services and other		362,705		10	%		383,958		9	%	(11	%)

	$	3,696,519		100	%	$	4,055,050		100	%	(9	%)

RELATED PARTY TRANSACTIONS

6 Months Ended

Jun. 30, 2023

RELATED PARTY TRANSACTIONS

RELATED PARTY TRANSACTIONS

9. RELATED PARTY TRANSACTIONS

SUBSEQUENT EVENTS

6 Months Ended

Jun. 30, 2023

SUBSEQUENT EVENTS

SUBSEQUENT EVENTS

10. SUBSEQUENT EVENTS

In July 2023 the Company issued 1,305,697 shares of common stock related to accrued compensation for its Board of Directors for their services in quarter 1 and quarter 2 of 2023.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)

6 Months Ended

Jun. 30, 2023

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

Accounts Receivable and Allowance For Doubtful Accounts

Software Development Costs and Acquired Software

Long-Lived Assets and Goodwill

Revenue Recognition

We have 6 primary sources of revenue

	1.	Electronic Prescription Software
	2.	Insurance Verifications
	3.	ICD-10 Medical Coding Software
	4.	Encrypted and HIPAA Compliant Secure email
	5.	Analytics
	6.	MSaaS software

1) Electronic Prescription software services are provided an annual subscription basis using the software as a service (‘SaaS’) model with revenue recognized ratably over the contract term.

2). Insurance verification services are provided on an annual subscription basis using SaaS model with revenue recognized ratably over the contract term.

3) ICD-10 Medical Coding services are provided on an annual subscription basis using the software as a SaaS model with revenues recognized ratably over the contract term.

4) Encrypted and HIPAA compliant and secure email services are provided on an annual subscription basis using the SaaS model with revenues recognized ratably over the contract term.

6) MSaaS software services are provided on an annual subscription basis using the software as a service (‘SaaS’) model with revenue recognized ratably over the contract term.

Advertising Costs

Accounting for Derivative Instruments

Financial Instruments With Down Round Features

Income Taxes

Use of Estimates

Net Loss Per Share

Stock-Based Compensation

Beneficial Conversion Features and Warrants

Leases

Related Party Transactions

Allowance for Credit Losses

Reportable Segments

Recently Issued Accounting Pronouncements

NOTES PAYABLE (Tables)

6 Months Ended

Jun. 30, 2023

NOTES PAYABLE

Schedule of Notes Payable

		June 31,			December 31,
		2023			2022
(1)	Convertible Note bearing interest at 12% due May, 2023		-			578,802
(2)	Note bearing interest at 18% due September 1, 2023		1,250,000			1,012,500
(2)	Note bearing interest at 18% due September 1, 2023		512,500			506,250
(3)	Note bearing interest at 18% due October 1, 2028		32,942			32,752
(4)	Secured Promissory Note bearing interest at 17.5% due February 28, 2026		1,943,390			1,960,965
(5)	Promissory Note bearing interest at 14%, due January 15, 2023		-			50,892
(6)	Promissory Note bearing interest at 14%, due September 1, 2023		350,055			329,227
(7)	Related Party Promissory Note bearing interest at 14% due September 1, 2023		66,293			108,778
(8)	Promissory Note bearing interest at 15%, due January 25, 2023		-			506,370
(9)	Promissory Note bearing interest at 15%, due September 1, 2023		253,082			253,184
(9)	Promissory Note bearing interest at 15%, due September 1, 2023		253,082			253,184
(10)	Related Party Promissory Notes bearing interest at 18%, due March 31, 2023		-			135,888
(11)	Convertible Note bearing interest at 15% due March 2024		2,208,507			-
(7)	Related Party Promissory Note bearing interest at 18%, due September 1, 2023		145,723			-
(12)	Convertible Note bearing interest at 15% due June 14, 2024		77,506			-
(13)	Convertible Note bearing interest at 15% due June 14, 2024		6,039			-
(14)	Related Party Convertible Promissory Note bearing interest at 15% due June 30, 2024		35,000			-
			6,909,119			5,728,792
	Less current maturities		(6,909,119	)		(4,279,531	)
	Total Long-Term Debt	$	-		$	1,449,261

COMMON STOCK (Tables)

6 Months Ended

Jun. 30, 2023

COMMON STOCK

Summary of Stock Option Activity

Nonvested Options	Number of Options			Weighted Average Grant Date Fair Value		Weighted Average Remaining Years to Vest

Nonvested - January 1, 2023		23,053,334		$	0.12		8.8

Granted		-		$	-		-
Vested		(100,000	)	$	0.12		8.8
Forfeited/expired		-			-		-
Nonvested – June 30, 2022		22,953,334		$	0.12		8.1

Schedule of Share Issuable Warrants

Type	Issue Date	Shares		Price		Expiration
Investors	4/19/2021		1,300,000	$	0.20	4/19/2026
Investors	4/19/2021		1,300,000	$	0.25	4/19/2026
Investors	4/22/2021		1,300,000	$	0.20	4/22/2026
Investors	4/22/2021		1,300,000	$	0.25	4/22/2026
Investors	4/30/2021		650,000	$	0.20	4/30/2026
Investors	4/30/2021		650,000	$	0.25	4/30/2026
Investors	5/4/2021		650,000	$	0.20	5/4/2026
Investors	5/4/2021		650,000	$	0.25	5/4/2026
Investors	5/19/2021		650,000	$	0.20	5/19/2026
Investors	5/19/2021		650,000	$	0.25	5/16/2026
Investors	8/31/2021		1,500,000	$	0.25	8/31/2026
Investors	7/29/2022		87,500	$	0.20	7/28/2027
Investors	7/29/2022		87,500	$	0.25	7/28/2027
Investors	8/5/2022		43,750	$	0.20	8/4/2027
Investors	8/5/2022		43,750	$	0.25	8/4/2027
Investors	8/19/2022		43,750	$	0.20	8/18/2027
Investors	8/19/2022		43,750	$	0.25	8/18/2027
Investors	11/28/2022		9,407	$	0.20	11/27/2027
Investors	11/28/2022		9,406	$	0.25	11/27/2027
Investors	12/15/2022		11,812	$	0.20	12/14/2027
Investors	12/15/2022		11,813	$	0.25	12/14/2027
Total			10,992,438

Schedule of warrants outstanding

Warrants Outstanding	Number of Warrants			Weighted Average Exercise Price		Weighted Average Remaining Contractual Term in Years		Aggregate Intrinsic Value
Outstanding – December 31, 2022		353,493,766		$	0.10		3.45	$	803,522
Granted		-			-		-		-
Forfeited/expired		(24,356,938	)	$	0.08		3.45		-
Outstanding – June 30, 2023		10,992,438		$	0.23		3.15	$	715,223

GOODWILL AND OTHER INTANGIBLE ASSETS (Tables)

6 Months Ended

Jun. 30, 2023

GOODWILL AND OTHER INTANGIBLE ASSETS

Schedule of Goodwill

	Total
Balance at December 31, 2022	$	1,484,966
2023 Acquisitions		-
Balance at June 30, 2023	$	1,484,966

Schedule of carrying amounts and accumulated amortization

	Gross Carrying Amount		Impairment		Accumulated Amortization			Net Carrying Amount
Definite-lived intangible assets:
Capitalized software	$	3,014,490	$	-	$	(2,483,429	)	$	531,061
Customer relationships		3,713,434		-		(1,363,054	)		2,350,380
Acquired technology		1,527,186		-		(1,447,758	)		79,428
Total definite-lived intangible assets at December 31, 2022		8,255,110		-		(5,294,241	)		2,960,869

Capitalized software		3,374,247		-		(2,651,850	)		722,397
Customer relationships		3,713,434		-		(1,722,800	)		1,990,634
Acquired technology		1,527,186		-		(1,489,522	)		37,664
Total definite-lived intangible assets at June 30, 2023	$	8,614,867				(5,864,172	)		2,750,695

COMMITMENTS AND CONTINGENCIES (Tables)

6 Months Ended

Jun. 30, 2023

COMMITMENTS AND CONTINGENCIES

Schedule of undiscounted future lease obligations

Lease Commitments
as of 06/30/2022
Less than 1 year		1-3 years		3-5 years		Total
$	246,648	$	501,452	$	417,787	$	1,165,887

Schedule of Undiscounted minimum lease commitments

Undiscounted minimum lease commitments	$	1,165,887
Present value adjustment using incremental borrowing rate		(274,499	)
Lease liabilities	$	891,388

SEGMENT INFORMATION (Tables)

6 Months Ended

Jun. 30, 2023

SEGMENT INFORMATION

Revenue Segment

	For the Three Months Ended June 30
	2023		%			2022		%			% Change
Revenue:
Subscription software and services	$	1,629,999		88	%	$	1,814,273		90	%	(10		%)

Professional services and other		226,149		12	%		196,888		10	%		15	%

	$	1,856,148		100	%	$	2,011,161		100	%	(9		%)

	For the Six Months Ended June 30
	2023		%			2022		%			% Change
Revenue:
Subscription software and services	$	3,333,814		90	%	$	3,671,092		91	%	(9	%)

Professional services and other		362,705		10	%		383,958		9	%	(11	%)

	$	3,696,519		100	%	$	4,055,050		100	%	(9	%)

NATURE OF OPERATIONS (Details Narrative) - USD ($)	3 Months Ended		6 Months Ended
NATURE OF OPERATIONS (Details Narrative) - USD ($)	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022	Dec. 31, 2022
NATURE OF OPERATIONS
Working Capital Deficit	$ 8,759,814		$ 8,759,814
Loss from operations	(2,108,588)	$ (1,211,944)	(3,459,646)	$ (2,208,497)
Accumulated deficit	$ (93,271,716)		$ (93,271,716)		$ (88,875,087)

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($)	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Dec. 31, 2022
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Allowance for doubtful accounts	$ 68,700		$ 65,000
Advertising Costs	$ 306,468	$ 263,693

NOTES PAYABLE (Details ) - USD ($)	6 Months Ended
NOTES PAYABLE (Details ) - USD ($)	Jun. 30, 2023	Dec. 31, 2022
Total Long-term debt, gross	$ 6,909,119	$ 5,728,792
Current maturities of long-term debt, net of	(6,909,119)	(4,279,531)
Long-term debt, net of current maturities	0	1,449,261
Promissory Note [Member]
Total Long-term debt, gross	$ 0	50,892
Interest rate	14.00%
Due date	Jan. 15, 2023
Promissory Note One[Member]
Total Long-term debt, gross	$ 350,055	329,227
Interest rate	14.00%
Due date	Sep. 01, 2023
Related Party Promissory Note One[Member]
Total Long-term debt, gross	$ 66,293	108,778
Interest rate	14.00%
Due date	Sep. 01, 2023
Promissory Note Two[Member]
Total Long-term debt, gross	$ 0	506,370
Interest rate	15.00%
Due date	Jan. 25, 2023
Promissory Note Three [Member]
Total Long-term debt, gross	$ 253,082	253,184
Interest rate	15.00%
Due date	Sep. 01, 2023
Promissory Note Four [Member]
Total Long-term debt, gross	$ 253,082	253,184
Interest rate	15.00%
Due date	Sep. 01, 2023
Related Party Promissory Note Two [Member]
Total Long-term debt, gross	$ 0	135,888
Interest rate	18.00%
Due date	Mar. 31, 2023
Convertible Notes Payable [Member]
Total Long-term debt, gross	$ 2,208,507	0
Interest rate	15.00%
Due date1	March 2024
Related Party Promissory Note Three [Member]
Total Long-term debt, gross	$ 145,723	0
Interest rate	18.00%
Due date	Sep. 01, 2023
Secured Promissory Note Payable Six[Member]
Total Long-term debt, gross	$ 6,039	0
Interest rate	15.00%
Due date	Jun. 14, 2024
Related Party Promissory Note Four [Member]
Total Long-term debt, gross	$ 35,000	0
Interest rate	15.00%
Due date	Jun. 30, 2024
Convertible Notes Payable One [Member]
Total Long-term debt, gross	$ 0	578,802
Interest rate	12.00%
Due date1	May, 2023
Convertible Notes Payable 2 Member
Total Long-term debt, gross	$ 77,506	0
Interest rate	15.00%
Due date	Jun. 14, 2024
Notes Payable Three [Member]
Total Long-term debt, gross	$ 512,500	506,250
Interest rate	18.00%
Due date	Sep. 01, 2023
Notes Payable Four [Member]
Total Long-term debt, gross	$ 32,942	32,752
Interest rate	18.00%
Due date	Oct. 01, 2028
Secured Promissory Note Payable Five [Member]
Total Long-term debt, gross	$ 1,943,390	1,960,965
Interest rate	17.50%
Due date	Feb. 28, 2026
Notes Payable Two [Member]
Total Long-term debt, gross	$ 1,250,000	$ 1,012,500
Interest rate	18.00%
Due date	Sep. 01, 2023

NOTES PAYABLE (Details Narrative) - USD ($)										1 Months Ended
NOTES PAYABLE (Details Narrative) - USD ($)	Mar. 31, 2023	Dec. 31, 2022	Jul. 31, 2022	Jun. 30, 2022	Apr. 30, 2022	Feb. 28, 2022	Nov. 30, 2021	Aug. 31, 2021	Apr. 30, 2021	Jul. 31, 2023	Jun. 30, 2023	Dec. 31, 2021	May 31, 2023
Exercisable price											$ 0.25
Interest Rate										15.00%	15.00%
Maturity date											6 years
Proceed from advance											$ 35,000
Promissory Note, Description											The Note is for $250,000 with $50,000 paid to the Holder on issuance for net proceeds of $200,000
One [Member]
Outstanding warrants													1,300,000
Exercisable price													$ 0.25
Proceed from convertible promissory notes											$ 77,000
Interest Rate											15.00%
Two [Member]
Outstanding warrants													1,300,000
Exercisable price													$ 0.20
Proceed from convertible promissory notes											$ 6,000
Interest Rate											15.00%
Convertible Promissory Note [Member]
Convertible Promissory Note								$ 1,000,000	$ 500,000
Exchange Received									$ 500,000
Interest Rate								15.00%	12.00%
Common Stock at fixed conversion price									$ 0.10
Common Stock Conversion Percentage									4.99%
Restricted Shares, Issued								1,000,000	788,000
Warrant Issued		1,462,500						1,500,000	2,600,000			2,250,000
Common Stock Term									5 years
Exercise price, per share		$ 0.08							$ 0.20
Exercise price one								$ 0.25	$ 0.25			$ 0.10
First Warrant Shares									1,300,000
Other Warrant Shares									1,300,000
Description of Maturity renegotiated									At Maturity this note was renegotiated and term extended to June 2023 for an additional principal consideration of $55,400 under the same interest rate and conditions as the matured note. This note and accrued interest was converted in January 2023 for 6,037,883 shares of Common Stock
Convertible Promissory Note one								$ 500,000
Warrant Term								5 years
Finance Agreement Payment							$ 40,071
Maturity date							60 years
Payments Of Principal And Interest							$ 791
Total Warrant Shares		7,312,500										3,750,000
Convertible Promissory Note [Member] \| August 2021 [Member]
Warrant Issued								3,250,000
Exercise price, per share								$ 0.10
Total Warrant Shares								5,850,000
Convertible Promissory Note [Member] \| December 2022 [Member]
Outstanding warrants													1,500,000
Warrant Issued		937,500
Exercise price, per share		$ 0.10
Total Warrant Shares		4,687,500
Convertible Promissory Note [Member] \| Unsecured Debt 1 [Member]
Convertible Promissory Note					$ 50,000
Exchange Received		$ 55,000
Interest Rate		15.00%			14.00%
Maturity date					6 years
Convertible Promissory Note [Member] \| Unsecured Debt 2 [Member]
Convertible Promissory Note					$ 300,000
Exchange Received		$ 80,000
Interest Rate		15.00%			14.00%
Maturity date					6 years
Convertible Promissory Note [Member] \| Unsecured Debt [Member]
Convertible Promissory Note			$ 500,000	$ 100,000							$ 145,010
Interest Rate			14.00%	14.00%							18.00%
Warrant Issued		23,625	175,000	18,813
Common Stock Term		5 years	5 years	5 years
Exercise price, per share		$ 0.20	$ 0.25	$ 0.25
Exercise price one		$ 0.25	$ 0.20	$ 0.20
First Warrant Shares		11,813	87,500	9,407
Other Warrant Shares		11,812	87,500	9,406
Maturity date			6 years	6 years
Maturity date of debt											Sep. 01, 2023
Conversion rate		$ 0.08
Stock issued for conversion of debt		1,019,315
Convertible Secured Promissory Note, Description	The Note is for $2,500,000 with $500,000 paid to the Holder on issuance for net proceeds of $2,000,000. The Note carries and interest of 15% per annum which can be paid in cash or kind and it is convertible either into the Company’s Common Stock after six months from date of issuance at $0.10 per share
Secured Promissory Note Payable [Member]
Convertible Promissory Note						$ 2,000,000
Debt obligation											$ 1,943,390
Exchange Received						$ 1,970,000
Interest Rate						17.50%
Maintaining Minimum Cash Balance						$ 150,000

COMMON STOCK (Details)	6 Months Ended
COMMON STOCK (Details)	Jun. 30, 2023 $ / shares shares
Options Outstanding
Number of Options/Warrants Outstanding, Beginning \| shares	32,235,000
Number of Options/Warrants Outstanding, Ending \| shares	32,235,000
Number of Options Outstanding, Exercisable Ending \| shares	9,281,666
Weighted Average Exercise Price, Beginning	$ 0.13
Weighted Average Exercise Price, Granted	0
Weighted Average Exercise Price, Exercised	0
Weighted Average Exercise Price, Forfeited	0
Weighted Average Exercise Price, Ending	0.13
Weighted Average Exercise Price, Exercisable	$ 0.12
Weighted Average Remaining Contractual Term in Years, Beginning	8 years 9 months 18 days
Weighted Average Remaining Contractual Term in Years, Ending	8 years 6 months
Weighted Average Remaining Contractual Term in Years, Exercisable Ending	8 years 1 month 6 days
Nonvested Options
Number of Options Nonvested, Beginning \| shares	23,053,334
Number of Options Nonvested, Vested \| shares	(100,000)
Number of Options Nonvested, Ending \| shares	22,953,334
Weighted Average grant date Fair Value Nonvested, Beginning	$ 0.12
Weighted Average grant date Fair Value Nonvested, Vested	0.12
Weighted Average grant date Fair Value Nonvested, Ending	$ 0.12
Weighted Average Remaining Years to vest Nonvested, Beginning	8 years 9 months 18 days
Weighted Average Remaining Years to vest Nonvested, Vested	8 years 9 months 18 days
Weighted Average Remaining Years to vest Nonvested, Ending	8 years 1 month 6 days

COMMON STOCK (Details 1 )	6 Months Ended
COMMON STOCK (Details 1 )	Jun. 30, 2023 $ / shares shares
Shares issued, warrants	10,992,438
Investors [Member]
Issued date	Apr. 19, 2021
Shares issued, warrants	1,300,000
Exercise price, per share \| $ / shares	$ 0.20
Expiration date	Apr. 19, 2026
Investors 2 [Member]
Issued date	Apr. 22, 2021
Shares issued, warrants	1,300,000
Exercise price, per share \| $ / shares	$ 0.20
Expiration date	Apr. 22, 2026
Investors 1 [Member]
Issued date	Apr. 19, 2021
Shares issued, warrants	1,300,000
Exercise price, per share \| $ / shares	$ 0.25
Expiration date	Apr. 19, 2026
Investors 5 [Member]
Issued date	Apr. 30, 2021
Shares issued, warrants	650,000
Exercise price, per share \| $ / shares	$ 0.25
Expiration date	Apr. 30, 2026
Investors 6 [Member]
Issued date	May 04, 2021
Shares issued, warrants	650,000
Exercise price, per share \| $ / shares	$ 0.20
Expiration date	May 04, 2026
Investors 7 [Member]
Issued date	May 04, 2021
Shares issued, warrants	650,000
Exercise price, per share \| $ / shares	$ 0.25
Expiration date	May 04, 2026
Investors 8 [Member]
Issued date	May 19, 2021
Shares issued, warrants	650,000
Exercise price, per share \| $ / shares	$ 0.20
Expiration date	May 19, 2026
Investors 9 [Member]
Issued date	May 19, 2021
Shares issued, warrants	650,000
Exercise price, per share \| $ / shares	$ 0.25
Expiration date	May 16, 2026
Investors 10 [Member]
Issued date	Aug. 31, 2021
Shares issued, warrants	1,500,000
Exercise price, per share \| $ / shares	$ 0.25
Expiration date	Aug. 31, 2026
Investors 11 [Member]
Issued date	Jul. 29, 2022
Shares issued, warrants	87,500
Exercise price, per share \| $ / shares	$ 0.20
Expiration date	Jul. 28, 2027
Investors 12 [Member]
Issued date	Jul. 29, 2022
Shares issued, warrants	87,500
Exercise price, per share \| $ / shares	$ 0.25
Expiration date	Jul. 28, 2027
Investors 13 [Member]
Issued date	Aug. 05, 2022
Shares issued, warrants	43,750
Exercise price, per share \| $ / shares	$ 0.20
Expiration date	Aug. 04, 2027
Investors 14 [Member]
Issued date	Aug. 05, 2022
Shares issued, warrants	43,750
Exercise price, per share \| $ / shares	$ 0.25
Expiration date	Aug. 04, 2027
Investors 15 [Member]
Issued date	Aug. 19, 2022
Shares issued, warrants	43,750
Exercise price, per share \| $ / shares	$ 0.20
Expiration date	Aug. 18, 2027
Investors 3 [Member]
Issued date	Apr. 22, 2021
Shares issued, warrants	1,300,000
Exercise price, per share \| $ / shares	$ 0.25
Expiration date	Apr. 22, 2026
Investors 4 [Member]
Issued date	Apr. 30, 2021
Shares issued, warrants	650,000
Exercise price, per share \| $ / shares	$ 0.20
Expiration date	Apr. 30, 2026
Investors 16 [Member]
Issued date	Aug. 19, 2022
Shares issued, warrants	43,750
Exercise price, per share \| $ / shares	$ 0.25
Expiration date	Aug. 18, 2027
Investors 17 [Member]
Issued date	Nov. 28, 2022
Shares issued, warrants	9,407
Exercise price, per share \| $ / shares	$ 0.20
Expiration date	Nov. 27, 2027
Investors 18 [Member]
Issued date	Nov. 28, 2022
Shares issued, warrants	9,406
Exercise price, per share \| $ / shares	$ 0.25
Expiration date	Nov. 27, 2027
Investors 19 [Member]
Issued date	Dec. 15, 2022
Shares issued, warrants	11,812
Exercise price, per share \| $ / shares	$ 0.20
Expiration date	Dec. 14, 2027
Investors 20 [Member]
Issued date32	Dec. 15, 2022
Shares issued, warrants	11,813
Exercise price, per share \| $ / shares	$ 0.25
Expiration date	Dec. 14, 2027

COMMON STOCK (Details 2)	6 Months Ended
COMMON STOCK (Details 2)	Jun. 30, 2023 USD ($) $ / shares shares
COMMON STOCK
Number of Warrants Outstanding, Beginning \| shares	353,493,766
Number of Warrants, granted \| shares	(24,356,938)
Number of Warrants Outstanding, Ending \| shares	10,992,438
Weighted Average Exercise Price of Warrants, Beginning	$ 0.10
Weighted Average Exercise Price of Warrants, Granted	0
Weighted Average Exercise Price of Warrants, Forfeited/Expired	0.08
Weighted Average Exercise Price of Warrants, Ending	$ 0.23
Weighted Average Remaining Life of Warrants in Years, Beginning	3 years 5 months 12 days
Weighted Average Remaining Life of Warrants in Years, Forfeited/expired	3 years 5 months 12 days
Weighted Average Remaining Life of Warrants in Years, Ending	3 years 1 month 24 days
Aggregate Intrinsic Value of Warrants, Beginning \| $	$ 803,522
Aggregate Intrinsic Value of Warrants, Ending \| $	$ 715,223

COMMON STOCK (Details Narrative) - USD ($)	1 Months Ended	6 Months Ended		12 Months Ended
COMMON STOCK (Details Narrative) - USD ($)	Apr. 30, 2023	Jun. 30, 2023	Jun. 30, 2022	Dec. 31, 2022	Mar. 13, 2023
Shares issuable upon exercise of common stock		10,992,438
Common Stock Shares Issued For Cash, Shares		5,400,000
Purchase of Common stock warrants			38,135
Restricted Stock Compensation		$ 184,167
Additional warrants to be issued			861,851
Restated strike price			$ 45,000
Strike price			$ 0.05
Common Stock Shares Issued For Cash, Value		540,000
Shares of common stock on the conversion of debt		$ 6,853,335
Committee [Member]
Additional compensation	$ 10,000
Chair of a Committee [Member]
Additional compensation	10,000
Restricted Stock Compensation [Member]
Restricted common stock issued for service, shares		2,425,000		250,000
Compensation	$ 60,000
Restricted common stock issued for srvice, value		$ 312,761		$ 122,375
Price per share				$ 0.089
Restricted shares of common stock issued for bonus, value				$ 160,645
Restricted Stock Compensation [Member] \| 2020 Service [Member] \| Chief Executive Officers [Member]
Restricted shares of common stock issued for bonus, value				$ 356,000
Restricted Shares Of Common Stock Issued For Bonus, Shares				4,000,000	150,000

GOODWILL AND OTHER INTANGIBLE ASSETS (Details)	6 Months Ended
GOODWILL AND OTHER INTANGIBLE ASSETS (Details)	Jun. 30, 2023 USD ($)
GOODWILL AND OTHER INTANGIBLE ASSETS
Balance, beginning	$ 1,484,966
2023 Acquisitions	0
Balance, ending	$ 1,484,966

GOODWILL AND OTHER INTANGIBLE ASSETS (Details 1) - USD ($)	6 Months Ended	12 Months Ended
	Jun. 30, 2023	Dec. 31, 2022
Gross carrying amount	$ 8,614,867	$ 8,255,110
Impairment		0
Accumulated amortization	(5,864,172)	(5,294,241)
Net carrying amount	2,750,695	2,960,869
Capitalized Software [Member]
Gross carrying amount	3,374,247	3,014,490
Impairment	0	0
Accumulated amortization	(2,651,850)	(2,483,429)
Net carrying amount	722,397	531,061
Customer Relationships [Member]
Gross carrying amount	3,713,434	3,713,434
Impairment	0	0
Accumulated amortization	(1,722,800)	(1,363,054)
Net carrying amount	1,990,634	2,350,380
Acquired Technology [Member]
Gross carrying amount	1,527,186	1,527,186
Impairment	0	0
Accumulated amortization	(1,489,522)	(1,447,758)
Net carrying amount	$ 37,664	$ 79,428

GOODWILL AND OTHER INTANGIBLE ASSETS (Details Narrative) - USD ($)	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022
GOODWILL AND OTHER INTANGIBLE ASSETS
Amortization expense of intangible assets	$ 569,932	$ 703,118

COMMITMENTS AND CONTINGENCIES (Details)	Jun. 30, 2023 USD ($)
Lease Commitments	$ 1,165,887
Less Than 1 Year [Member]
Lease Commitments	246,648
1-3 years [Member]
Lease Commitments	501,452
3-5 years [Member]
Lease Commitments	$ 417,787

COMMITMENTS AND CONTINGENCIES (Details 1) - Lease [Member]	Jun. 30, 2023 USD ($)
Undiscounted Minimum Lease Commitments	$ 1,165,887
Present Value Adjustment Using Incremental Borrowing Rate	(274,499)
Lease Liabilities	$ 891,388

COMMITMENTS AND CONTINGENCIES (Details Narrative) - USD ($)	1 Months Ended			6 Months Ended
	May 31, 2023	Feb. 21, 2023	Nov. 15, 2017	Jun. 30, 2023
Repayment guarantee	$ 400,000
Lease [Member]
Lease Agreement Description			the Company signed a three-year lease agreement for approximately 4,100 square feet of office space located in Winter Garden
Lease Costs				$ 151,174
Cash Paid Measurement Of Lease Liabilities				$ 159,098
Settlement Agreement [Member]
Claimed charge of damages		$ 635,000
Lease Agreement [Member] \| November 15, 2017 [Member]
Term Of Lease Agreement				An amendment to this lease was signed on October 26, 2020

CONCENTRATION OF CREDIT RISK (Details Narrative) - USD ($)	6 Months Ended
	Jun. 30, 2023	Dec. 31, 2022
Fdic Insured Limit	$ 250,000
Revenue Benchmark [Member] \| No Customers [Member]
Concentration Risk, Percentage	10.00%
Accounts Receivable [Member] \| Three Customers [Member]
Concentration Risk, Percentage	59.00%
Accounts Receivable [Member] \| One Customers [Member]
Concentration Risk, Percentage		31.00%

SEGMENT INFORMATION (Details) - USD ($)	3 Months Ended		6 Months Ended
SEGMENT INFORMATION (Details) - USD ($)	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Total [Member]
Total Revenue	$ 1,856,148	$ 2,011,161	$ 3,696,519	$ 4,055,050
Revenues:
Revenue, Percentage	100.00%	100.00%	100.00%	100.00%
Total percent	(9.00%)		(9.00%)
Revenue Segment [Member]
Revenues:
Subscription Software And Services, Percentage Change	(10.00%)		(9.00%)
Professional Services And Other, Percentage Changes	15.00%		(11.00%)
Subscription Software And Services	$ 1,629,999	$ 1,814,273	$ 3,333,814	$ 3,671,092
Subscription Software And Services, Percentage	88.00%	90.00%	90.00%	91.00%
Professional Services And Other	$ 226,149	$ 196,888	$ 362,705	$ 383,958
Professional Services And Other, Percentage	12.00%	10.00%	10.00%	9.00%

RELATED PARTY TRANSACTIONS (Details Narrative) - USD ($)	1 Months Ended		3 Months Ended		6 Months Ended
	Jul. 31, 2023	Jun. 30, 2023	Mar. 31, 2023	Mar. 31, 2022	Jun. 30, 2023
Principal and interest payments for note payable			$ 60,318	$ 407,309
Interest Rate	15.00%	15.00%
Accrued unpaid interest		$ 713			$ 713
Chief Executive Officer [Member]
Promissory note			$ 100,000		250,000
Proceed from advance					35,000
Additional promissory note					$ 145,010
Interest Rate			14.00%		15.00%
Maturity date					Sep. 01, 2023
Accrued unpaid interest		$ 16,293			$ 16,293
Net proceeds					200,000
Payable to the issuer					$ 50,000

SUBSEQUENT EVENTS (Details Narrative) - USD ($)	1 Months Ended
SUBSEQUENT EVENTS (Details Narrative) - USD ($)	Jul. 31, 2023	Jun. 30, 2023
Interest Rate	15.00%	15.00%
Convertible promissory note payable	$ 40,000
Maturity date		6 years
Board of Directors
Stock issued during the period for compensation	1,305,697
Maturity date		12 years

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