| Derivative Liability |
Due to the variable conversion price
associated with some of these convertible promissory notes disclosed in Note 8 above, the Company has determined that the conversion
feature is considered a derivative liability for instruments which are convertible and have not yet been settled. The accounting treatment
of derivative financial instruments requires that the Company record the fair value of the derivatives on the date they are deemed to
be derivative liabilities.
During the nine month period ended
March 31, 2021, the Company recorded a change in fair value of derivative $887,301. The Company will measure the fair value of each derivative
instrument in future reporting periods and record the change based on the change in fair value.
Below
is a reconciliation of the derivative liability as presented on the Company’s balance sheet as of March 31, 2021:
| |
|
|
|
| Derivative liability as of June 30, 2020 |
|
$ |
1,590,638 |
|
| Initial derivative liability accounted for convertible notes payable
issued during the period ended March 31, 2021 |
|
|
512,993 |
|
| True-up adjustment in debt discount and derivative liability |
|
|
37,360 |
|
| Change in derivative liability during the period |
|
|
887,301 |
|
| Reclassify derivative liability associated
with Notes converted into loss on debt conversion account |
|
|
(1,716,114 |
) |
| Balance at March 31, 2021 |
|
|
1,312,178 |
|
Change in derivative liability for the
nine months ended March 31, 20210 and 2020, totaled $887,301 and $(612,093), respectively and change in derivative liability for the
three months ended March 31, 2021 and 2020, totaled $1,096,709 and $(256,468), respectively.
As
of March 31, 2021 and June 30, 2020, the derivative liability related to convertible notes was $ 1,312,178 and $1,590,638, respectively.
|
| 11. |
Derivative Liability |
|
Due
to the variable conversion price associated with some of these convertible promissory notes disclosed in Note 8 above, the
Company has determined that the conversion feature is considered a derivative liability for instruments which are convertible
and have not yet been settled. The accounting treatment of derivative financial instruments requires that the Company record
the fair value of the derivatives on the date they are deemed to be derivative liabilities. |
| |
|
|
During
the year ended June 30, 2020, the Company recorded a gain in fair value of derivative liability of $858,774. The Company will
measure the fair value of each derivative instrument in future reporting periods and record a gain or loss based on the change
in fair value. |
| |
|
|
|
| |
|
|
Below is a reconciliation
of the derivative liability as presented on the Company’s balance sheet as of June 30, 2020: |
| Derivative liability as of
June 30, 2018 |
|
$ |
1,765,187 |
|
| Initial derivative
liability accounted for convertible notes payable issued during the period ended June 30, 2019 |
|
|
1,565,535 |
|
| Change in derivative
liability during the period |
|
|
712,627 |
|
| Reclassify derivative
liability associated with Notes converted |
|
|
(2,736,601 |
) |
| Derivative liability as of June 30, 2019 |
|
$ |
1,306,748 |
|
| Initial
derivative liability accounted for convertible notes payable issued during the period ended June 30, 2020 |
|
|
1,723,883 |
|
| Change in derivative
liability during the period |
|
|
(858,774 |
) |
| Reclassify derivative
liability associated with Notes converted |
|
|
(581,219 |
) |
| Balance at June 30, 2020 |
|
$ |
1,590,638 |
|
|