WIKISOFT CORP.
The accompanying notes
are an integral part of these audited consolidated financial statements.
WIKISOFT CORP.
NOTES TO FINANCIAL STATEMENTS
1. ORGANIZATION AND NATURE OF BUSINESS
Organization
WikiSoft
Corp. (“we”, “our”, the "Company") was incorporated in the state of Nevada in May 1998 as Sensor Technologies
Inc.
Nature of operations
The Company
is a wiki portal for businesses. Built on MediaWiki software, the new portal, called wikiprofile.com, is expected to eventually be the
largest in the wiki platform with over 328 million published articles and profiles on companies, top brands, and corporate influencers.
Users will be able to freely search the portal and all content will eventually be collected, updated and fact-checked in real-time. The
Company will generate revenue through paid advertisement placements imbedded in the webpages associated with wikiprofile.com.
2. SUMMARY OF SIGNIFICANT POLICIES
Basis of Presentation and Principles of consolidation
The
accompanying consolidated financial statements represent the results of operations, financial position and cash flows of the Company prepared
on the accrual basis of accounting and conform to accounting principles generally accepted in the United States of America. The consolidated
financial statements include the accounts of the Company and its wholly owned subsidiaries. – On March 31, 2019, the Company, a
Nevada corporation, entered into an Agreement and Plan of Merger with WikiSoft DE, a Delaware corporation, and WikiSoft Acquisition, Inc.,
a Delaware corporation. WikiSoft Acquisition, Inc. merged with and into WikiSoft DE (the “Merger”) on April 30, 2019, with
the filing of Articles of Merger with the Delaware Secretary of State. All significant inter-company transactions and balances have been
eliminated.
Use of estimates
The preparation
of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires
management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets
and liabilities at the date of the consolidated financial statements, and the reported amounts of revenues and expenses during the reporting
period. Actual results could differ from those estimates. Significant estimates include estimates used to review the Company’s,
impairments and estimations of long-lived assets, revenue recognition of Contract based revenue, allowances for uncollectible accounts,
and the valuations of non-cash capital stock issuances. The Company bases its estimates on historical experience and on various other
assumptions that are believed to be reasonable in the circumstances, the results of which form the basis for making judgments about the
carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from
these estimates under different assumptions or conditions.
Fair value of
financial instruments
The carrying value
of cash, accounts payable and accrued expenses, and debt approximate their fair values because of the short-term nature of these instruments.
Management believes the Company is not exposed to significant interest or credit risks arising from these financial instruments.
Fair value is defined
as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous
market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques
used to measure fair value maximize the use of observable inputs and minimize the use of unobservable inputs. The Company utilizes a fair
value hierarchy based on three levels of inputs, of which the first two are considered observable and the last unobservable.
• |
Level 1 - |
Quoted prices in active markets for identical assets
or liabilities. These are typically obtained from real-time quotes for transactions in active exchange markets involving identical assets.
|
• |
Level 2 - |
Quoted prices for similar assets and liabilities in
active markets; quoted prices included for identical or similar assets and liabilities that are not active; and model-derived valuations
in which all significant inputs and significant value drivers are observable in active markets. These are typically obtained from readily-available
pricing sources for comparable instruments.
|
• |
Level 3 - |
Unobservable inputs, where there is little or no market activity for the asset or liability. These inputs reflect the reporting entity’s own beliefs about the assumptions that market participants would use in pricing the asset or liability, based on the best information available in the circumstances. |
Revenue Recognition
The Company recognizes
revenue in accordance with ASC Topic 606. The accounting policy on revenue recognition is provided below.
Service Contracts
The company recognizes service contract revenue over
time, as performance obligations are satisfied, due to the continuous transfer of control to the customer. Service contracts are generally
accounted for as a single unit of account (a single performance obligation) and are not segmented between types of services. The company
recognizes revenue based primarily on contract cost incurred to date compared to total estimated contract cost (an input method). The
input method is the most faithful depiction of the company’s performance because it directly measures the value of the services
transferred to the customer. Changes to total estimated contract cost or losses, if any, are recognized in the period in which they are
determined as assessed at the contract level. Pre-contract costs are expensed as incurred unless they are expected to be recovered from
the client. Project mobilization costs are generally charged to project costs as incurred when they are an integrated part of the performance
obligation being transferred to the client. Customer payments on service contracts are typically due in advance, depending on the contract.
For service contracts in which the company has the
right to consideration from the customer in an amount that corresponds directly with the value to the customer of the company’s
performance completed to date, revenue is recognized when services are performed and contractually billable. Service contracts that include
multiple performance obligations are segmented between types of services. For contracts with multiple performance obligations, the company
allocates the transaction price to each performance obligation using an estimate of the stand-alone selling price of each distinct service
in the contract. Revenue recognized on service contracts that have not been billed to clients is classified as a current asset under contract
assets on the Consolidated Balance Sheet. Amounts billed to clients in excess of revenue recognized on service contracts to date are classified
as a current liability under contract liabilities. Customer payments on service contracts are typically due within 30 days of billing,
depending on the contract.
Cash and cash equivalents
For purposes of the statements of cash flows, the
Company considers all highly liquid investments and short-term debt instruments with original maturities of six months or less to be cash
equivalents. There was $14,300 and $15,659 in cash and no cash equivalents as of March 31, 2022 and December 31, 2021, respectively.
Stock-based compensation
The Company follows
the guidelines in FASB Codification Topic ASC 718-10 “Compensation-Stock Compensation,” which requires companies to
measure the cost of employee services received in exchange for an award of an equity instrument based on the grant-date fair value of
the award. Stock-based compensation expense is recognized on a straight-line basis over the requisite service period. The Company accounts
for non-employee share-based awards in accordance with FASB ASC 505-50 under which the awards are valued at the earlier of a commitment
date or upon completion of the services, based on the fair value of the equity instruments, and are recognized as expense over the service
period.
Earnings (loss) per share
The Company reports earnings (loss) per share in accordance
with Financial Accounting Standards Board’s (“FASB”) Accounting Standards Codification (“ASC”) 260-10 “Earnings
Per Share,” which provides for calculation of “basic” and “diluted” earnings per share. Basic earnings
per share includes no dilution and is computed by dividing net income or loss available to common stockholders by the weighted average
common shares outstanding for the period. Diluted earnings per share reflect the potential dilution of securities that could share in
the earnings of an entity. The calculation of diluted net loss per share gives effect to common stock equivalents; however, potential
common shares are excluded if their effect is anti-dilutive.
Long-lived Assets
In accordance with the Financial Accounting Standards
Board ("FASB") Accounts Standard Codification (ASC) ASC 360-10, "Property, Plant and Equipment," the carrying value
of intangible assets and other long-lived assets is reviewed on a regular basis for the existence of facts or circumstances that may suggest
impairment. The Company recognizes impairment when the sum of the expected undiscounted future cash flows is less than the carrying amount
of the asset. Impairment losses, if any, are measured as the excess of the carrying amount of the asset over its estimated fair value.
Income
taxes
The
Company accounts for its income taxes in accordance with FASB Codification Topic ASC 740-10, “Income Taxes”, which
requires recognition of deferred tax assets and liabilities for future tax consequences attributable to differences between the financial
statement carrying amounts of existing assets and liabilities and their respective tax bases and tax credit carry-forwards. Deferred tax
assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary
differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized
in income in the period that includes the enactment date.
Recently issued
accounting pronouncements
The Company has evaluated all other recent accounting
pronouncements and believes that none of them are expected to have a material effect on the Company's financial position, results of operations
or cash flows.
3. GOING CONCERN
The accompanying consolidated financial
statements have been prepared in accordance with accounting principles generally accepted in the United States of America on a going concern
basis, which contemplates the realization of assets and the satisfaction of liabilities and commitments in the normal course of business.
Management
evaluated all relevant conditions and events that are reasonably known or reasonably knowable, in the aggregate, as of the date the consolidated
financial statements are issued and determined that substantial doubt exists about the Company’s ability to continue as a going
concern. The Company’s ability to continue as a going concern is dependent on the Company’s ability to generate revenues and
raise capital. The Company has not generated sufficient revenues from product sales to provide sufficient cash flows to enable the Company
to finance its operations internally. As of March 31, 2022, the Company had $14,300 cash on hand. At March 31, 2022 the Company has an
accumulated deficit of $12,933,028. For the three months ended March 31, 2022, the Company had a net loss of $169,990, and net cash used
in operations of $54,183. These factors raise substantial doubt about the Company’s ability to continue as a going concern within
one year from the date of filing.
Over the next twelve months management plans to use
borrowings and security sales to mitigate the effects of cash flow deficits; however, no assurance can be given that debt or equity financing,
if and when required, will be available. The financial statements do not include any adjustments relating to the recoverability and classification
of recorded assets and classification of liabilities that might be necessary should the Company be unable to continue existence.
4. PURCHASE OF MEMBERSHIP INTEREST IN ETHERALABS
LLC
On February 28, 2022, the Company entered into a definitive
agreement to acquire 51% of Etheralabs LLC for 2,550,000 of the Company’s common stock valued at $104,550. Etheralabs LLC is a New
York City based venture lab and ecosystem that invests in, builds, and deploys disruptive technologies across the Blockchain space and
the transaction includes a global access to Etheralabs´ full stack of technologies across the Blockchain and global funding landscape.
Etheralabs ecosystem allows development and finance partnerships throughout the blockchain world and beyond, and connects the blockchain
community, investors and venture capital to relevant data intelligence and direct investment opportunities. Wikisoft intends to ensure
that Etheralabs future product and technology roadmap supports wikiprofile.com and the upcoming Wikifunding platform aiming to accelerate
matching investors to startups.
5. RELATED PARTY TRANSACTIONS
Related party advances
As of March
31, 2022 and December 31, 2021, the Company had amounts due to Fastbase Inc, a Company commonly controlled by a former board
member of the Company, of $29,626 and $29,626,
respectively. During the three months ended March 31, 2022 and 2021, the Company
received additional advances in the amounts of $0 and $0, respectively, and the Company made payments on the advances in the amounts
of $0 and $0, respectively.
Loans payable - related party
On June 1, 2020 the company entered into a loan agreement
with Fastbase Inc, a company controlled by a prior board member of the Company, in the amount of $30,215. The amount bears no interest
and is due upon request.
On September 1, 2020 the company entered into a loan
agreement with Fastbase Inc, a company controlled by a prior board member of the Company, in the amount of $15,000. The note bears
an interest rate of 4.25% and is due on September 1, 2022.
On October 24, 2020 the company entered into a loan
agreement with Fastbase Inc, a company controlled by a prior board member of the Company, in the amount of $7,875. The note bears an
interest rate of 4.25% and is due on January 1, 2023.
On December 3, 2020 the company entered into a
loan agreement with Fastbase Inc, a company controlled by a prior board member of the Company, in the amount of $10,000.
The note bears an interest rate of 4.25% and
is due on January
1, 2023. On January 20, 2022 the Company paid the loan in full as well as accrued interest of $477. As of March
31, 2022 the balance of principal owed was $0.
As of March
31, 2022 and December 31, 2021, the Company had loans due to related parties of $53,090 and 63,090, respectively. Interest expense
related to related party loans was $1,012 and $745 for the three months ending March 31, 2022 and
2021, respectively, of which $745 was imputed interest and recorded against additional paid in capital for the period ended March
31, 2022.
Line of credit – related party
On December 30, 2020 the company entered into a $1,000,000
revolving note agreement with it majority shareholder. The note carries and 0.01% interest rate and is due on the later of the date the
Company has the funds to repay the note or 24 months. During the three months ended March 31, 2022,
the Company borrowed $5,000 under the revolving note. As of March 31, 2022 and December 31,
2021, the note had a balance of $300,000 and $295,000, respectively. Interest expense related to the line of credit was $8 and $3 for
the three months ending March 31, 2022 and 2021, respectively.
6. STOCKHOLDERS’ EQUITY
The Company’s authorized capital stock consists
of 200,000,000 shares of common stock and 1,000,000 shares of preferred stock, par value $0.001 per share. As of March
31, 2022 and December 31, 2021, there were 100,288,209 and 94,738,209 shares of common stock issued and outstanding, respectively.
As of March
31, 2022 and December 31, 2021, there were 0 and 0 shares of preferred stock of the Company issued and outstanding,
respectively.
Common Stock issuances during the three months
ending March 31, 2022
On January 3, 2022, the Company issued 500,000 shares
of common stock for $20,523 cash.
On January 10, 2022, the Company issued 500,000 shares
of common stock for $15,975 cash.
On March 10, 2022, the Company issued 500,000 shares
of common stock for $7,688 cash.
On March 21, 2022, the Company issued 750,000 shares
of common stock for $13,638 cash.
On March 29, 2022, the Company issued 750,000 shares
of common stock for $11,725 cash. As of March 31, 2022 the cash had not been received and was recorded as stock receivable.
On February 28 2022 the company entered into a definitive
agreement to acquire 51% of Etheralabs LLC for 2,550,000 of the Company’s common stock valued at $104,550. See note 4 for additional
information.
7. SUBSEQUENT EVENTS
In accordance with ASC 855-10, we have analyzed our operations subsequent
to March 31, 2022 through the date these financial statements were issued and have determined that we do not have any material subsequent
events to disclose or recognize in these financial statements.