SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BASIS OF PRESENTATION
In the opinion of management,
the accompanying balance sheets and related interim statements of income, cash flows, and stockholders' equity include all adjustments,
consisting only of normal recurring items, necessary for their fair presentation in conformity with accounting principles generally
accepted in the United States of America ("U.S. GAAP"). Preparing financial statements requires management to make estimates
and assumptions that affect the reported amounts of assets, liabilities, revenue, and expenses. Actual results and outcomes may
differ from management's estimates and assumptions. Interim results are not necessarily indicative of results for a full year.
The consolidated financial
statements for the fiscal years ended August 31, 2012 and 2011 include the accounts of Oncologix Tech, Inc. and its wholly owned
subsidiaries, Oncologix Corporation (90% Owned), Interpretel Inc., Telplex International and International Environment Corporation
collectively the Company. Oncologix Corporation is a Nevada corporation. Interpretel Inc., Telplex International and International
Environment Corporation are inactive corporations. All significant intercompany accounts and transactions have been eliminated
USE OF ESTIMATES
The preparation of financial
statements in accordance 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 and disclosure of contingent assets and liabilities
at the date of the financial statements and the reportable amounts of revenues and expenses during the reporting period. Actual
results could differ from those estimates.
Revenue is recognized
by the Company when all the following criteria are met: persuasive evidence of an arrangement exists; delivery has occurred; the
sellers price to the buyer is fixed and determinable; and collectability is reasonably assured. Currently the company does
not have products to sell.
CASH AND CASH EQUIVALENTS
The Company considers all
highly liquid instruments, with an initial maturity of three (3) months or less to be cash equivalents.
PROPERTY AND EQUIPMENT
Property and equipment
is recorded at cost. Depreciation is provided for on the straight-line method over the estimated useful lives of the related assets
|Furniture and fixtures||
||5 to 10 years|
||5 to 10 years|
||3 to 5 years|
The cost of maintenance
and repairs is charged to expense in the period incurred. Expenditures that increase the useful lives of assets are capitalized
and depreciated over the remaining useful lives of the assets. When items are retired or disposed of, the cost and accumulated
depreciation are removed from the accounts and any gain or loss is included in income.
360 Property, Plant and Equipment addresses financial accounting and reporting for the impairment or disposal of long-lived
assets. The Company periodically evaluates whether events and circumstances have occurred that may warrant revision of the estimated
useful life of property and equipment or whether the remaining balance of property and equipment, or other long-lived assets, should
be evaluated for possible impairment. Instances that may lead to an impairment include: (i) a significant decrease in the
market price of a long-lived asset group; (ii) a significant adverse change in the extent or manner in which a long-lived
asset or asset group is being used or in its physical condition; (iii) a significant adverse change in legal factors or in
the business climate that could affect the value of a long-lived asset or asset group, including an adverse action or assessment
by a regulatory agency; (iv) an accumulation of costs significantly in excess of the amount originally expected for the acquisition
or construction of a long-lived asset or asset group; (v) a current-period operating or cash flow loss combined with a history
of operating or cash flow losses or a projection or forecast that demonstrates continuing losses associated with the use of a long-lived
asset or asset group; or (vi) a current expectation that, more likely than not, a long-lived asset or asset group will be
sold or otherwise disposed of significantly before the end of its previously estimated useful life.
estimate of the related undiscounted cash flows, excluding interest, over the remaining life of the property and equipment and
long-lived assets is used in assessing recoverability. Impairment loss is measured by the amount which the carrying amount of the
asset(s) exceeds the fair value of the asset(s). The Company primarily employs two methodologies for determining the fair value
of a long-lived asset: (i) the amount at which the asset could be bought or sold in a current transaction between willing
parties or (ii) the present value of estimated expected future cash flows grouped at the lowest level for which there are
identifiable independent cash flows.
ASC 810 - Consolidation
addresses the accounting and reporting standards for ownership interest in subsidiaries held by parties other than the parent,
the amount of consolidated net income attributable to the parent and to the non-controlling interest, changes in a parents
ownership interest, and the valuation of retained non-controlling equity investments when a subsidiary is deconsolidated. During
fiscal 2009, the Company issued a ten percent interest in its subsidiary, Oncologix Corporation, to IUTM as required in a technology
agreement. The Company valued this interest at $212. Through August 31, 2012, the Company has allocated $3,687 losses to its non-controlling
interest. The Company has adopted ASC 810 to account for this non-controlling interest.
Advertising costs included
with selling, general and administrative expenses in the accompanying consolidated statements of operations were nil for fiscal
2012 and fiscal 2011. Such costs are expensed when incurred.
The Company adopted the
provisions of FASB ASC 740 - Income Taxes provides detailed guidance for the financial statement recognition, measurement and disclosure
of uncertain tax positions recognized in the financial statements. Income taxes are determined using the asset and liability method.
This method gives consideration to the future tax consequences associated with temporary differences between the carrying amounts
of assets and liabilities for financial statement purposes and the amounts used for income tax purposes.
FAIR VALUE OF FINANCIAL INSTRUMENTS
The estimated fair values
for financial instruments are determined at discrete points in time based on relevant market information. These estimates involve
uncertainties and cannot be determined with precision. The carrying amounts of accounts payable, accrued expenses, and notes payable
approximate fair value.
The Company has a stock-based
compensation plan, which is described more fully in Note 5. The Company accounts for stock-based compensation in accordance with
ASC 718. Under the fair value recognition provisions of this statement, share-based compensation cost is measured at the grant
date based on the fair value of the award and is recognized as expense over the vesting period. The Company estimates the fair
value of stock options granted using the Black-Scholes option valuation model. The fair value of all awards is amortized on a straight-line
basis over the vesting periods. The expected term of awards granted represent the period of time they are expected to be outstanding.
The Company determines the expected term based on historical experience with similar awards, giving consideration to the contractual
terms and vesting schedules. The Company estimates the expected volatility of its common stock at the date of grant based on the
historical volatility of its common stock. The risk-free interest rate is based on the U.S. treasury security rate estimated for
the expected life of the options at the date of grant. If actual results differ significantly from estimates, stock-based compensation
could be impacted.
Interest on convertible
debt is calculated using the simple interest method. The company recognizes a beneficial conversion feature to the extent the conversion
price is less than the closing stock price on the issuance of the convertible notes. The Company also follows ASC 470-50 and ASC
470-20 regarding changes in the terms of the convertible notes and the induced conversion of its convertible debt.
Certain prior year amounts
have been reclassified to conform to the current year presentation.
NET LOSS PER COMMON SHARE
Basic earnings (loss) per
share is calculated under the provisions of ASC 260 which provides for calculation of basic and diluted
earnings per share. Basic earnings per share includes no dilution and is calculated by dividing income (loss) available to
common shareholders by the weighted average number of common shares outstanding for the period. Diluted earnings (loss) per
share is calculated based on the weighted average number of common shares outstanding during the period plus the dilutive effect
of common stock purchase warrants and stock options using the treasury stock method and the dilutive effects of convertible notes
payable and convertible preferred stock using the if-converted method. On Basic and diluted earnings per share for the two
years ended August 31, 2012 and 2011 are as follows:
||For the Year Ended|
|Net loss attributable to common shareholders||
|| || || ||
|| || || |
|Weighted average shares outstanding||
|| ||54,443,649|| ||
|| ||47,915,734|| |
|| || || ||
|| || || |
|Loss per common share, basic and diluted:||
Due to the net losses during
the fiscal 2012 and 2011, basic and diluted loss per share was the same, as the effect of potentially dilutive securities would
have been anti-dilutive. Shares attributable to convertible notes, stock options, preferred stock and warrants not included the
diluted loss per share calculation. Below lists all dilutive securities as of August 31, 2012 and 2011:
|| || Underlying || ||
|| || Underlying || |
|| || Common Shares || ||
|| || Common Shares || |
|Convertible preferred stock||
|| ||64,531|| ||
|| ||64,531|| |
|Convertible notes payable||
|| ||1,383,459|| ||
|| ||1,695,959|| |
|| ||297,085|| ||
|| ||297,085|| |
|| || || ||
|| || || |
|| || || ||
|| || || |
|Total potentially dilutive securities||
|| ||1,745,075|| ||
|| ||2,057,575|| |
ASC 280-10 defines operating
segments as components of a company about which separate financial information is available that is evaluated regularly by the
chief decision maker in deciding how to allocate resources and in assessing performance. The Company currently has one operating
segments: medical device.
RECENT ACCOUNTING PRONOUNCEMENTS
We have evaluated all Accounting
Standards Updates through the date the financial statements were issued and do not believe any will have a material impact.