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Item 9A. Controls and Procedures

2018-02-20 compared with 2017-01-25 · 817 added, 883 removed, 602 unchanged (74% of the section changed)

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Evaluation of Disclosure Controls and Procedures

Our management is responsible for establishing

and maintaining adequate internal control over financial reporting.

Responsibility, estimates and judgments by management are required

to assess the expected benefits and related costs of control procedures.

The objectives of internal control include providing management

with reasonable, but not absolute, assurance that assets are safeguarded against loss from unauthorized use or disposition, and

that transactions are executed in accordance with management’s authorization and recorded properly to permit the preparation

of consolidated financial statements in conformity with accounting principles generally accepted in the United States.

Our management,

including our chief executive officer and chief financial officer, assessed the effectiveness of our internal control over financial

reporting as of September 30, 2016.

In making this assessment, our management used the criteria set forth by the Committee of Sponsoring

Organizations of the Treadway Commission (“COSO”) in Internal Control-Integrated Framework.

Our management,

including our chief executive officer and chief financial officer, has concluded that, as of September 30, 2016, our internal control

over financial reporting was not effective in providing reasonable assurance regarding the reliability of financial reporting and

the preparation of financial statements for external purposes in accordance with US generally accepted accounting principles.

management reviewed the results of their assessment with our board of directors.

This annual report does not include

an attestation report of our company’s registered public accounting firm regarding internal control over financial

Management’s report was not subject to attestation by our company’s registered public accounting firm

pursuant to rules of the Securities and Exchange Commission that permit our company to provide only management’s report

in this annual report.

Inherent Limitations on Effectiveness

Internal control over financial reporting

has inherent limitations which include but is not limited to the use of independent professionals for advice and guidance, interpretation

The Company’s management is responsible

for establishing and maintaining adequate internal control over financial reporting.

Responsibility, estimates and judgments by

management are required to assess the expected benefits and related costs of control procedures.

The objectives of internal control

include providing management with reasonable, but not absolute, assurance that assets are safeguarded against loss from unauthorized

use or disposition, and that transactions are executed in accordance with management’s authorization and recorded properly

to permit the preparation of consolidated financial statements in conformity with accounting principles generally accepted in the

United States.

Its management, including its chief executive officer and chief financial officer, assessed the effectiveness of

its internal control over financial reporting as of September 30, 2017.

In making this assessment, its management used the criteria

set forth by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) in Internal Control-Integrated

The Company’s management, including its chief executive officer and chief financial officer, has concluded that,

as of September 30, 2017, its internal control over financial reporting was not effective in providing reasonable assurance regarding

the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with US

generally accepted accounting principles.

The Company’s management reviewed the results of their assessment with its board

of directors.

This annual report does not include an attestation

report of the Company’s registered public accounting firm regarding internal control over financial reporting.

Management’s

report was not subject to attestation by the Company’s registered public accounting firm pursuant to rules of the Securities

and Exchange Commission that permit the company to provide only management’s report in this annual report.

Inherent Limitations on Effectiveness of Controls

Internal control over financial reporting has

inherent limitations which include but is not limited to the use of independent professionals for advice and guidance, interpretation

of existing and/or changing rules and principles, segregation of management duties, scale of organization, and personnel factors.

Internal control over financial reporting is a process that involves human diligence and compliance and is subject to lapses

in judgment and breakdowns resulting from human failures.

Internal control over financial reporting also can be circumvented

by collusion or improper management override.

Because of its inherent limitations, internal control over financial reporting

may not prevent or detect misstatements on a timely basis, however these inherent limitations are known features of the financial

reporting process and it is possible to design into the process safeguards to reduce, though not eliminate, this risk.

even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation

and presentation.

Projections of any evaluation of effectiveness to future periods are subject to the risk that controls

may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Changes in Internal Control over Financial

During the period covered by this report,

there were no changes in the Company’s internal control over financial reporting that have materially affected, or are reasonably

Internal control over financial reporting is a process that involves human diligence and compliance and is subject to lapses in

judgment and breakdowns resulting from human failures.

Internal control over financial reporting also can be circumvented by collusion

or improper management override.

Because of its inherent limitations, internal control over financial reporting may not prevent

or detect misstatements on a timely basis, however these inherent limitations are known features of the financial reporting process

and it is possible to design into the process safeguards to reduce, though not eliminate, this risk.

Therefore, even those systems

determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation.

Projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because

of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Changes in Internal Control over Financial Reporting

During the period covered by this report, there

were no changes in the Company’s internal control over financial reporting that have materially affected, or are reasonably

likely to materially affect, the Company’s internal control over financial reporting.

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Directors and Executive Officers

Set forth below is certain information regarding the persons

who were directors and executive officers at any time during the fiscal year 2016.

Positions with the Company

Set forth below is certain information regarding

the persons who were directors and executive officers at any time during the fiscal year 2017.

Position with the Company

Chairman of the Board, Chief Executive Officer

Paul Williams

Vice Chairman of the Board, Chief Financial Officer, Assistant Secretary and Assistant Treasurer

President, Chief Strategy Officer, Secretary, Treasurer and Board Member

Chief Operating Officer

Vice Chairman of the Board, Chief Financial Officer, Secretary and Treasurer

President, Chief Sales Officer and Board Member

Chief Technology Officer and Chief Marketing Officer

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George Crumley

John Pollock , 50, has been

CEO/Founder of Business Legacy, Inc.

since 2002, Pollock Advisory Group since 2007 and he is currently CEO and Chairman of Financial

Gravity Companies, Inc.

Pollock’s specific experience, qualifications, attributes or skills that led to the conclusion

that he should serve as a director for the Company:

Assistant Secretary, Assistant Treasurer and Board Member

John Pollock , 51, has been CEO/Founder

of Business Legacy, Inc.

since 2002, Pollock Advisory Group since 2007 and he is currently CEO and Chairman of Financial Gravity

Companies, Inc.

Pollock’s specific experience, qualifications, attributes or skills that led to the conclusion that he

should serve as a director for the Company:

Has served as CEO and Chairman of Financial Gravity since its inception

A seasoned manager

Williams , 60, has

served on our Board of Directors and as Vice Chairman of the Board since 2015, and has served as our Chief Financial Officer and

Assistant Secretary –

Assistant Treasurer since 2016.

He graduated from Austin College in Sherman, Texas in 1978 and the

Institute for Organization Management in Washington, DC in 1982.

Williams , 61, has served

on the Company’s Board of Directors and as Vice Chairman of the Board since 2015, and has served as our Chief Financial Officer

and Secretary –

Treasurer since 2016.

He graduated from Austin College in Sherman, Texas in 1978 and

the Institute for Organization Management in Washington, DC in 1982.

Since 2007, Mr.

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On behalf of Halo Companies, Inc.

Williams has served as Vice Chairman of the Board, Treasurer, and Assistant Secretary from 2009 to Present, and Served

as Chief Financial Officer from 2009 to 2012 and from 2015 to Present.

Williams has served as Vice Chairman of the Board, Treasurer, and Assistant Secretary from 2009 to Present, and Served as Chief

Financial Officer from 2009 to 2012 and from 2015 to Present.

Halo Companies, Inc.

is a nationwide distressed asset services

company, providing technology-driven asset management, portfolio due diligence, acquisition, repositioning and liquidation strategies

for the private investment and mortgage servicing industry.

is a nationwide distressed asset services company,

providing technology-driven asset management, portfolio due diligence, acquisition, repositioning and liquidation strategies for

the private investment and mortgage servicing industry.

The breadth of Mr.

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Over 30 years of business experience, primarily in capital markets, mergers, and acquisitions

Chief Executive Officer of Bison Financial Group, a corporate financial advisory and business development

firm serving middle market growth companies

Chief Executive Officer of Bison Financial Group, a corporate financial advisory and business development firm serving middle

market growth companies

Has served as both officer and director of other public companies

Financial Gravity is the third public company for which Mr.

Williams is serving as Chief Financial

Williams is serving as Chief Financial Officer

Within the last 5 years, Mr.

Williams served as Vice-Chairman of the Board and Chief Financial

Officer at Halo Companies, Inc., a public company

David Crowley , 60, began

at Financial Gravity Companies as Chief Sales Officer in January 2013, has served on our Board of Directors and as Secretary of

the Board since January 2015, and served as our President and Chief Strategy Officer since June 2016.

He graduated from University

of MO - Rolla with a BS in Electrical Engineering in June 1978 and the University of MN with an MS in Electrical Engineering in

Crowley owned and operated Resonate, Inc., a management consulting and training company for small business owners

from July 1999 to July 2008, co-owned 80/20 Health Insurance, an insurance agency with over 20 field agents in Colorado from January

2004 to December 2010 and co-owned United Meridian Insurance, a property & casualty agency in Colorado from January 2010 to

December 2012.

Crowley’s specific experience, qualifications, attributes or skills that led to the conclusion that he

should serve as a director for the Company:

21 years as an Engineer with high technology computer company

10 years of project management and process engineering experience at General Motors helping develop

their vehicle development process

5 years teaching graduate school Management Information Systems course at Walsh College

8 years of financial services experience in health, life and property & casualty insurance

4 years of tax business experience with Financial Gravity developing the process that the company

now uses to sell tax services to business owners and to expand nationally to financial advisors

Lyon , 52, has

been our Chief Tax Strategist and a Director since October, 2015.

From 2005 until 2015, he was Partner-in-Charge of Content

at Tax Coach Software, which he founded in 2005.

Williams served as Vice-Chairman of the Board and Chief Financial Officer at Halo Companies, Inc.,

a public company

Dan Sundby , 55, brings over

30 years of experience in sales, sales management, and sales training.

He has built sales teams nationally within the

insurance and financial services industries.

Dan’s organization was consistently the top producing team with each

company he recruited and trained for.

Dan also recruited and trained sales teams in the receivables management industry and

with a regional home builder with record setting performance in each.

Dan is currently serving as President and Chief Sales

Officer for Financial Gravity and is responsible for building their nationwide agent team.

Reggio , 54, has been

the Company’s Chief Marketing Officer & Chief Technology Officer since January of 2015 when he joined the company via

the Cloud9 Holdings acquisition, where he served as CTO beginning in 2013.

From 2006 –

Reggio held various roles

with EFA Processing LP, including Chief Technology Officer, Senior Vice President of Technology, and Executive Vice President.

Reggio was principle with Exectech Consulting Services from 2004 –

He served as Chief Information Officer of Affirmative

Insurance Holdings, Inc.

from 2001 –

2004 and Chief Information Officer of Instant Insurance Holdings, Inc.

from 1999 –

2001, as well as Chief Information Officer and Vice President of The St.

Paul Specialty Auto Group from 1997 –

Reggio received his BA in Computer Science from Western Michigan University in 1986, and currently serves as a board member for

the Innovate Flower Mound Entrepreneur Center, and is a managing partner in Tri-Liberty LLC and DayOne Consulting LLC.

Lyon , 53, has been

the Company’s Chief Tax Strategist and a Director since October, 2015.

From 2005 until 2015, he was Partner-in-Charge of

Content at Tax Coach Software, which he founded in 2005.

Lyon received a B.A.

in History from Hamilton College in 1986 and a J.D.

in History from Hamilton College in 1986 and

from the University of Cincinnati College of Law in 1991.

Lyon’s specific experience, qualifications, attributes or

skills that led to the conclusion that he should serve as a director for the Company:

Lyon’s specific experience, qualifications, attributes

or skills that led to the conclusion that he should serve as a director for the Company:

The founder of Tax Coach Software, managing the company for 11 years

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A nationally-recognized expert on tax planning

The author of 8 books, and has appeared on over 500 radio and television broadcasts to speak about

his areas of expertise

Crumley , 49, has

been on the Board of Directors since January 2015.

From 1994 to 2007 he was a practicing litigation attorney with the law firm

of Stradley & Wright in Dallas, Texas where he was named partner in 2001.

He formed Pittenger, Nuspl & Crumley in 2008

where he continues to practice, advising businesses in matters including formation, contracts, employees, real estate and litigation

among other areas of law.

The author of 8 books, and has appeared on over 500 radio and television broadcasts to speak about his areas of expertise

Crumley , 50,

has been on the Board of Directors since January 2015 and has served as our Assistant Secretary –

Assistant Treasurer

since October 2017.

From 1994 to 2007 he was a practicing litigation attorney with the law firm of Stradley & Wright in

Dallas, Texas where he was named partner in 2001.

He formed Pittenger, Nuspl & Crumley in 2008 where he continues to

practice, advising businesses in matters including formation, contracts, employees, real estate and litigation among other

areas of law.

He received BA.

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serves on the Board of Directors for Legacy Christian Academy in Frisco, Texas.

Crumley’s specific experience, qualifications,

attributes or skills that led to the conclusion that he should serve as a director for the Company:

23 years of experience in civil litigation and representing

businesses with formation, contracts, lawsuits, employee disputes, real estate, and other matters.

Reggio , 53, has

been our Chief Marketing Officer & Chief Technology Officer since January of 2015 when he joined the company via the Cloud9

Holdings acquisition, where he served as CTO beginning in 2013.

From 2006 –

Reggio held various roles with EFA

Processing LP, including Chief Technology Officer, Senior Vice President of Technology, and Executive Vice President.

was principle with Exectech Consulting Services from 2004 –

He served as Chief Information Officer of Affirmative Insurance

Holdings, Inc.

from 2001 –

2004 and Chief Information Officer of Instant Insurance Holdings, Inc.

from 1999 –

as well as Chief Information Officer and Vice President of The St.

Paul Specialty Auto Group from 1997 –

received his BA in Computer Science from Western Michigan University in 1986, and currently serves as a board member for the Innovate

Flower Mound Entrepreneur Center, and is a managing partner in Tri-Liberty LLC and DayOne Consulting LLC.

Johnson , 57, has

been our Chief Operating Officer since June of 2016, and previously served Financial Gravity as Vice President of Operations beginning

in May of 2015.

Johnson joined Cloud9b2b, LLC (a Financial Gravity acquisition) as President and General Manager in April of

Prior to his involvement in Financial Gravity, Mr.

Johnson served as Chief Operating Officer for Bridge Metrics 2013 –

2014, and was Chief Operating Officer of Smart Customer Acquisition 2011 –

From 2008 –

2011, Mr Johnson was with

Leadership where he held various positions including President in his last year there.

He served as Chief Operating Officer

for James One Companies 2005 –

2007, and served as Chief Operating Officer of Software Medium 2003 –

Johnson was Chief Operating Officer for Migratec, Inc.

From 1995 –

1997, he served in various roles including

Business Manager, and then Director with Software AG.

Johnson began his career with what is now Accenture (previously Andersen

Consulting and Arthur Andersen MICD), where he progressed from Staff Consultant, Senior Consultant, Manager, Sr Manager, and Director

from 1982 –

Johnson received his BBA in Finance from Texas Tech University in 1981.

Section 16(a) Beneficial Ownership Reporting

Section 16(a) of the Securities Exchange Act

of 1934, as amended (the “Exchange Act”), requires officers, directors and persons who beneficially own more than

Crumley’s specific experience,

qualifications, attributes or skills that led to the conclusion that he should serve as a director for the Company:

23 years of experience in civil litigation and representing businesses with formation, contracts, lawsuits, employee disputes,

real estate, and other matters.

Section 16(a) Beneficial Ownership Reporting Compliance

Section 16(a) of the Securities Exchange

Act of 1934, as amended (the “Exchange Act”), requires officers, directors and persons who beneficially own more than

10% of a class of our equity securities registered under the Exchange Act to file reports of ownership and changes in ownership

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We have notified all known

beneficial owners of more than 10% of our common stock of their requirement to file ownership reports with the Securities and

Exchange Commission.

beneficial owners of more than 10% of our common stock of their requirement to file ownership reports with the Securities and Exchange

Code of Ethics

We do not currently have a Code of Ethics applicable to our

principal executive, financial, and accounting officers.

The Company has adopted a code of ethics

that applies to its principal executive, financial, and accounting officers and is included as an exhibit with this filing.

No Committees of the Board of Directors;

No Financial Expert

We do not presently have a separately constituted

audit committee, compensation committee, nominating committee, executive committee or any other committees of our Board of Directors.

Nor do we have an audit committee “financial expert”.

At present, our entire Board of Directors acts as our audit committee.

None of the members of our Board of Directors meets the definition of “audit committee financial expert”

in Item 407(d) of Regulation S-K promulgated by the Securities and Exchange Commission.

We have not retained an audit committee

financial expert because we do not believe that we can do so without undue cost and expense.

Moreover, we believe that the present

members of our Board of Directors, taken as a whole, have sufficient knowledge and experience in financial affairs to effectively

perform their duties.

The Company does not presently have a separately

constituted audit committee, compensation committee, nominating committee, executive committee or any other committees of its Board

of Directors.

Nor does it have an audit committee “financial expert”.

At present, its entire Board of Directors acts

as its audit committee.

None of the members of its Board of Directors meets the definition of “audit committee financial

expert”

as defined in Item 407(d) of Regulation S-K promulgated by the Securities and Exchange Commission.

It has not retained

an audit committee financial expert because it does not believe that it can do so without undue cost and expense.

believes that the present members of the Board of Directors, taken as a whole, have sufficient knowledge and experience in financial

affairs to effectively perform their duties.

EXECUTIVE COMPENSATION.

Summary Compensation Table

The particulars of compensation paid to

the following persons during the fiscal period ended September 30, 2016 and 2015 are set out in the summary compensation table

The particulars of compensation paid to the

following persons during the fiscal period ended September 30, 2017 and 2016 are set out in the summary compensation table below:

our Chief Executive Officer (Principal Executive Officer);

our Chief Accounting Officer (Principal Financial Officer);

each of our three most highly compensated executive officers, other than the Principal Executive

Officer and the Principal Financial Officer, who were serving as executive officers at the end of the fiscal year ended September

30, 2016 and 2015;

up to two additional individuals for whom disclosure would have been provided under the item above

but for the fact that the individual was not serving as our executive officer at the end of the fiscal year ended September 30,

2016 and 2015.

our Chief Financial Officer (Principal Financial Officer);

each of our three most highly compensated executive officers, other than the Principal Executive Officer and the Principal

Financial Officer, who were serving as executive officers at the end of the fiscal year ended September 30, 2017 and 2016;

up to two additional individuals for whom disclosure would have been provided under the item above but for the fact that the

individual was not serving as our executive officer at the end of the fiscal year ended September 30, 2017 and 2016.

(collectively, the “

Named Executive Officers ”):

SUMMARY COMPENSATION TABLE

Named Executive

Officers ”):

SUMMARY COMPENSATION

Name and Principal Position

CEO, Principal

Executive Officer

Option Awards

CEO, Principal Executive Officer

Paul Williams

CFO, Principal Financial Officer

President and CSO

$198,000 (**)

Except as described below, none of the

Named Executive Officers has an employment agreement.

Lyon, a member of the Board of

Directors, is party to an employment agreement with Tax Coach Software, LLC, a subsidiary of the Company.

The Agreement was entered

into effective November 1, 2015, and provides for Mr.

Lyon to serve as General Manager, responsible for supervising the business

and affairs of Tax Coach Software.

President and CSO

Except as described below, none of the Named Executive Officers

has an employment agreement.

Lyon, a member of the Board of Directors,

is party to an employment agreement with Tax Coach Software, LLC, a subsidiary of the Company.

The Agreement was entered into effective

November 1, 2015, and provides for Mr.

Lyon to serve as General Manager, responsible for supervising the business and affairs of

Tax Coach Software.

The agreement has a three-year term, which may be extended.

The agreement provides for base

salary of $42,000.00 per year, plus bonus.

The agreement provides for base salary of $42,000

per year, plus bonus.

The annual bonus is the sum of the following:

(i) for Tax Coach Software revenues in

excess of $850,000 and less than $950,000, forty percent (40%) of Tax Coach Software’s gross profit (as determined in accordance

with generally acceptable accounting principles, net of amounts paid under employment agreements and consulting agreements), plus

(ii) for Tax Coach Software revenues in excess of $950,000, twenty percent (20%) of Tax Coach Software’s gross profit (as

determined in accordance with generally acceptable accounting principles, net of amounts paid under employment agreements and consulting

Pollock, the amount shown in the Summary Compensation

Table under the heading All Other Compensation represents amounts paid by Financial Gravity to a consulting firm owned and controlled

Pollock, in compensation for services not related to his roles as an officer and director of Financial Gravity.

Lyon, the amount shown in the Summary Compensation

Table under the heading All Other Compensation represents amounts paid by Financial Gravity to a consulting firm owned and controlled

Lyon, in compensation for services not related to his roles as an officer and director of Financial Gravity.

(i) for Tax Coach Software revenues in excess of $850,000 and

less than $950,000, forty percent (40%) of Tax Coach Software’s gross profit (as determined in accordance with generally

acceptable accounting principles, net of amounts paid under employment agreements and consulting agreements), plus (ii) for Tax

Coach Software revenues in excess of $950,000, twenty percent (20%) of Tax Coach Software’s gross profit (as determined in

accordance with generally acceptable accounting principles, net of amounts paid under employment agreements and consulting agreements).

Pollock, the amount shown in the Summary

Compensation Table under the heading All Other Compensation represents amounts paid by the Company to a consulting

firm owned and controlled by Mr.

Pollock, in compensation for services not related to his roles as an officer and director of

Lyon, the amount shown in the Summary

Compensation Table under the heading All Other Compensation represents amounts paid by the Company to a consulting

firm owned and controlled by Mr.

Lyon, in compensation for services not related to his roles as an officer and director of

(***) For Mr.

Williams, the amount shown in the Summary

Compensation Table under the heading All Other Compensation represents amounts paid by the Company to a consulting firm owned

and controlled by Mr.

Williams, in compensation for services not related to his roles as an officer and director of the Company.

Summary Compensation

Except as described above, the Company has no employment agreements

with any of its Directors or executive officers.

Except as described above, the Company has

no employment agreements with any of its Directors or executive officers.

For the fiscal year ended September 30, 2017,

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No stock appreciation

rights have been granted to any of our Directors or executive officers and none of our Directors or executive officers exercised

rights have been granted to any of the Directors or executive officers and none of the Directors or executive officers exercised

any stock options or stock appreciation rights.

There are no non-equity incentive plan agreements with any of our Directors or

There are no non-equity incentive plan agreements with any of the Directors or

executive officers.

Outstanding Equity Awards at Fiscal Year-end

This section is not applicable to any Named Executive Officer

as of 9/30/2016.

This section is not applicable to any Named

Executive Officer as of September 30, 2017.

Compensation of Directors

DIRECTOR COMPENSATION

Fees earned or

Paul Williams

George Crumley

This section is not applicable as there was no director compensation

for year ended September 30, 2017.

Employment Contracts, Termination of Employment, Change-in-Control

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or arrangements with officers or Directors.

There are no compensation plans or arrangements, including payments to be made by us,

with respect to our officers, Directors or consultants that would result from the resignation, retirement or any other termination

of service in respect of such Directors, officers or consultants.

There are no arrangements for Directors, officers, employees

or consultants that would result from a change-in-control.

SECURITY OWNERSHIP OF CERTAIN

BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS.

There are no compensation plans or arrangements, including payments to be made by

us, with respect to the Company’s officers, Directors or consultants that would result from the resignation, retirement

or any other termination of service in respect of such Directors, officers or consultants.

There are no arrangements for Directors,

officers, employees or consultants that would result from a change-in-control.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND

MANAGEMENT AND RELATED STOCKHOLDER MATTERS.

Security Ownership of Certain Beneficial Owners and Management

The following table sets forth certain

information with respect to the beneficial ownership, as of September 30, 2016, of the Company’s common stock, which is the

Company’s only outstanding class of voting securities, and the voting power resulting from such beneficial ownership, by

The following table sets forth certain information

with respect to the beneficial ownership, as of September 30, 2017, of the Company’s common stock, which is the Company’s

only outstanding class of voting securities, and the voting power resulting from such beneficial ownership, by

each stockholder known by the Company to be the beneficial owner of more than 5% of the Company’s outstanding common

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all directors and executive officers of the Company as a group.

Amount of Beneficial

Beneficial Owner(1)

Ownership (1)

Amount of Beneficial Ownership (1)

Percentage of Shares

John Pollock (2)

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George Crumley (2)

Directors and executive officers as group (seven persons)

____________________

(1) except as noted below, each beneficial owner has sole voting

and investment power with respect to all shares attributable to that owner.

Directors and executive officers as group (six persons)

(1) except as noted below, each beneficial owner has sole voting and investment power with respect to all shares attributable to

(2) The address for each such beneficial owner is 800 N.

Road, Suite 120, Allen, Texas 75013.

(3) Includes 1,330 options that vested upon closing of the

merger on September 30, 2016.

Watters Road, Suite 120, Allen, Texas 75013.

(3) Includes 180,000 options that vested upon closing of the merger on September 30, 2016.

(4) Includes 650,000 options that vested upon closing of the merger on September 30, 2016

(5) Non director or executive officer with more than 5% ownership.

* indicates an ownership percentage of less than one percent.

indicates an ownership percentage of less than

Changes in Control

We are unaware of any contract or other arrangement the operation

of which may at a subsequent date result in a change of control of our Company.

The Company is not aware of any contract or

other arrangement the operation of which may at a subsequent date result in a change of control of the Company.

Securities authorized for issuance under equity compensation

The following table provides information as of the end of the

most recently completed fiscal year, with respect to Company compensation plans (including individual compensation arrangements)

under which equity securities of the Company are authorized for issuance.

Equity Compensation

Plan Information

Number of securities to be issued upon exercise of outstanding options, warrants

Weighted average exercise price of outstanding options, warrants

Number of securities remaining available for future issuance under equity compensation

plan (excluding securities reflected in

The following table provides information as

of the end of the most recently completed fiscal year, with respect to Company compensation plans (including individual compensation

arrangements) under which equity securities of the Company are authorized for issuance.

Equity Compensation Plan Information

Plan Category

Number of securities to be issued upon exercise of outstanding options, warrants and rights

Weighted average exercise price of outstanding options, warrants and rights

Number of securities remaining available for future issuance under equity compensation plan (excluding securities reflected in Column A)

Equity compensation plans approved by security holders

9,000,000 (2)

6,799,654 (3)

Equity compensation plans not approved by security holders

___________________

(1) As consequence of the Merger, outstanding options as

to 2,211,146 of the Company’s shares have vested.

(2) Shares subject to stock options under 2015 Stock

(3) Shares available for grant of stock options to

employees, directors and consultants under the 2015 Stock Option Plan.

Following is a brief description of the

material features of each compensation plan under which equity securities of the Company are authorized for issuance.

Stock Option Plan was adopted without approval of Company security holders.

The Company has granted stock options

to certain employees and contractors under its 2015 Stock Option Plan, assumed from Financial Gravity Holdings.

The Company is

authorized to issue an aggregate of 9,000,000 options, of which 6,799,654 remain available for issuance, as non-statutory (non-qualified)

stock options, under the 2015 Stock Option Plan.

Currently outstanding options under the 2015 Stock Option Plan vest over a period

of no greater than two years, and expire ten years from the grant date.

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS,

AND DIRECTOR INDEPENDENCE.

(1) As consequence of the Merger, outstanding options of the 2015 Plan in the amount of 2,200,346 of

the Company’s shares have vested.

(2) Shares subject to stock options under 2015 Stock Option Plan.

(3) Shares subject to stock options under 2016 Stock Option Plan.

(4) The 2015 Stock Option Plan was replaced by the 2016 Stock Option Plan.

(5) Shares available for grant of stock options to employees, directors and consultants under the 2015

Stock Option Plan.

Following is a brief description of the material

features of each compensation plan under which equity securities of the Company are authorized for issuance.

The 2015 Stock Option

Plan and the 2016 Stock Option Plan were adopted without approval of Company security holders.

The Company has granted stock options to certain

employees and contractors under its 2015 Stock Option Plan, assumed from Financial Gravity Holdings and under its 2016 Stock Option

The Company is authorized to issue an aggregate of 20,000,000 options, of which 19,383,200 remain available for issuance,

as non- statutory (non-qualified) stock options, under the 2016 Stock Option Plan.

Currently outstanding options under the 2015

and 2016 Stock Option Plans vest over a period of no greater than two years and expire ten years from the grant date.

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND

DIRECTOR INDEPENDENCE.

Transactions with Related Persons, Promoters and Certain Control Persons

Except as set forth below, none of the

Company’s directors or officers, nor any person who beneficially owns, directly or indirectly, shares carrying more than

10% of the voting rights attached to the Company’s shares, nor any relative or spouse of any of the foregoing persons, has

had any material interest, direct or indirect, in any transaction to which the Company was a party, and in which the amount

involved exceeds the lesser of (i) $120,000 or (ii) one percent of the average of the Company’s total

assets at year-end for the last two completed fiscal years.

Except as set forth below, none of the Company’s

directors or officers, nor any person who beneficially owns, directly or indirectly, shares carrying more than 10% of the voting

rights attached to the Company’s shares, nor any relative or spouse of any of the foregoing persons, has had any material

interest, direct or indirect, in any transaction to which the Company was a party, and in which the amount involved exceeds the

lesser of (i) $120,000 or (ii) one percent of the average of the Company’s total assets at year-end for the last two completed

fiscal years.

Bison Financial Group, whose Chief Executive

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flat fee of $3,000 per month.

The provision of services commenced in 2014, during which time Mr.

Williams had no formal affiliation

with the Company.

The provision of services by Bison Financial Group continued in 2015, during which time the Company paid Bison

Financial Group an aggregate of $9,020.

The provision of services provided by Bison Financial Group commenced in 2014, during

which time Mr.

Williams had no formal affiliation with the Company.

During 2015, Mr.

Williams was appointed to the board of directors of the Company and consequently

became an affiliate of the Company.

The provision of services by Bison Financial Group continued in 2016, during which time the

Company paid Bison Financial Group an aggregate of $49,000 for the years ended September 30, 2016.

Williams was appointed

as Chief Financial Officer of the Company.

Williams was appointed to the board of directors

of the Company and consequently became an affiliate of the Company.

Williams was appointed as Chief Financial Officer

of the Company.

The provision of services by Bison Financial Group ceased upon Mr.

Williams being appointed as Chief Financial

For the years ended September 30, 2017 and 2016, the Company paid Bison Financial Group for financial advisory

and business development services, $0 and $49,000 respectively.

Effective as of October 1, 2015, Financial

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As a consequence of such issuance,

Lyon is the beneficial owner of 7.2% of the Company’s common stock as of September 30, 2016 (after giving effect to the

Lyon is the beneficial owner of 7.3% of the Company’s common stock as of September 30, 2017 (after giving

effect to the Merger).

Additionally, Van Data, LLC, which is an

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of Company common stock are completely separated.

During fiscal 2016, Financial Gravity

Holdings paid $218,990 to Van Data, LLC, a consulting firm owned and controlled by Keith VandeStadt,

in compensation for maintaining the Tax Coach Software application and data, making enhancements and modifications to software

as needed, maintaining server platform and web environment, applying updates to licensed content, and other services agreed upon

During fiscal 2015, Financial Gravity

Holdings paid $198,000 to Tax Tuneup, LLC, a consulting firm owned and controlled by Mr.

in compensation for services not related to his roles as an officer and director.

The services rendered to Financial Gravity Holdings

involved providing weekly content for company newsletters, hosting weekly events, hosting additional webinars as needed,

and other services agreed upon in writing.

On December 30, 2014, Financial Gravity

Holdings acquired 100% of the capital stock of Cloud9 Holdings Company.

In consideration of such purchase, Financial Gravity Holdings

issued 1,314,477 shares of Financial Gravity Holdings common stock to the selling shareholder.

The selling stockholder in the transaction

Paul Boyd, then serving as Chief Operating Officer of the Company.

The shares of Financial Gravity Holdings common stock

which served as the consideration in the transaction had an approximate value of $438,159.

In connection with the transaction,

Financial Gravity Holdings also agreed to pay $132,682 of pre-existing expenses, including a payable to Mr.

During fiscal year 2017 and 2016,

the Company paid $198,000 and $ 218,990, respectively

to Van Data, LLC, a consulting firm owned and controlled by Keith VandeStadt, in compensation for maintaining the Tax Coach Software

application and data, making enhancements and modifications to software as needed, maintaining server platform and web environment,

applying updates to licensed content, and other services agreed upon in writing.

Director Independence;

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the interests of the Company are best served by the combination of the roles of Chairman of the Board and Chief Executive Officer.

As a matter of regular practice, and as part

of its oversight function, the Company’s Board of Directors undertakes a review of the significant risks in respect of the

Company’s business.

Such review is conducted in concert with outside professionals (including legal counsel) with expertise

in substantive areas germane to the Company’s business.

With the Company’s current governance structure, the Company’s

Board of Directors and senior executives are, by and large, the same individuals, and consequently, there is not a significant

division of oversight and operational responsibilities in managing the material risks facing the Company.

As a matter of regular practice, and as

part of its oversight function, the Company’s Board of Directors undertakes a review of the significant risks in respect

of the Company’s business.

Such review is conducted in concert with outside professionals (including legal counsel) with

expertise in substantive areas germane to the Company’s business.

With the Company’s current governance structure,

the Company’s Board of Directors and senior executives are, by and large, the same individuals, and consequently, there is

not a significant division of oversight and operational responsibilities in managing the material risks facing the Company.

PRINCIPAL ACCOUNTING FEES AND SERVICES.

The following information summarizes the

fees billed to us by Lane Gorman Trubitt, PLLC for professional services rendered for the fiscal year ended September 30, 2016

and 2015, respectively.

or remainder to be billed for audit services by Lane Gorman Trubitt, PLLC were $132,536 for fiscal year 2016 and $20,741 for fiscal

Audit fees include fees associated with the annual audit and the reviews of the Company’s quarterly reports on

Form 10-Q, and other SEC filings.

fees billed to us by Lane Gorman Trubitt, PLLC and Whitley Penn LLP for professional services rendered for the fiscal years ended

September 30, 2017 and 2016, respectively.

for services by Lane Gorman Trubitt, PLLC were $32,536 for fiscal year

Fees billed or remainder to be billed for audit services by Whitley Penn LLP were $126,687 for fiscal year 2017 and

$0 for fiscal year 2016.

Audit fees include fees associated with the annual audit and the reviews of the Company’s quarterly

reports on Form 10-Q, and other SEC filings.

Audit-Related Fees.

did not pay any audit-related service fees to Lane Gorman Trubitt, PLLC, other than the fees described above, for services rendered

during fiscal year 2016 or 2015.

Fees billed or remainder to be billed

for tax services by Whitley Penn LLP were $11,200 for fiscal year 2017 and $0 for fiscal year 2016

All Other Fees.

Consistent with SEC policies regarding auditor

independence, the audit committee has responsibility for appointing, setting compensation, approving and overseeing the work of

the independent auditor.

In recognition of this responsibility, the audit committee pre-approves all audit and permissible non-audit

services provided by the independent auditor.

The Board of Directors serves as the audit committee for the Company.

Consistent with SEC policies regarding

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Financial Statements and financial statement schedules

(1) and (2) The financial statements

and financial statement schedules required to be filed as part of this report are set forth in Item 8 of Part II of this report.

(1) and (2) The financial statements and financial statement schedules required to be filed as part of this report are set forth

in Item 8 of Part II of this report.

(3) Exhibits.

See Item 15(b) below.

Exhibits required by Item 601 of Regulation S-K

Changes in Registrant’s Certifying Accountant

required by Item 601 of Regulation S-K

Code of Ethics

Sarbanes-Oxley Section 302(a) Certification of John Pollock

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XBRL Presentation Linkbase Document

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

January 25, 2017

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.

February 19, 2018

/s/ John Pollock

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(Principal Executive Officer)

January 25, 2017

February 19, 2018

/s/ Paul Williams

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(Principal Financial Officer)

Pursuant to the requirements of the Securities Exchange Act

of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the

dates indicated.

Pursuant to the requirements of the Securities

Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities

and on the dates indicated.

/s/ John Pollock

Chairman, CEO

January 25, 2017

February 19, 2018

(principal executive officer)

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Vice Chairman, CFO

January 25, 2017

February 19, 2018

Paul Williams

(principal financial officer)

/s/ Dave Crowley

January 25, 2017

/s/ Dan Sundby

February 19, 2018

/s/ Edward A.

January 25, 2017

February 19, 2018

/s/ George Crumley

January 25, 2017

February 19, 2018

George Crumley

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AND SUBSIDIARIES

CONSOLIDATED FINANCIAL STATEMENTS

AND REPORT OF INDEPENDENT REGISTERED

PUBLIC ACCOUNTING FIRM

CONSOLIDATED FINANCIAL STATEMENTS AND

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING

SEPTEMBER 30, 2017 AND 2016

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CONSOLIDATED STATEMENTS OF OPERATIONS

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’

CONSOLIDATED STATEMENTS OF CASH FLOW

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ACCOUNTING FIRM

To the Board of Directors and Stockholders

Board of Directors and Stockholders of

Financial Gravity Companies, Inc.

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(the “Company”), as of September 30, 2017 and 2016, and the related

consolidated statements of operations, stockholders’

consolidated statements of operations, changes in stockholders’

equity, and cash flows for the years then ended.

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principles generally accepted in the United States of America.

The accompanying consolidated financial statements

have been prepared assuming that the entity will continue as a going concern.

As discussed in Note 1 to the financial statements,

the entity has suffered recurring losses from operations and has a net capital deficiency that raises substantial doubt about its

ability to continue as a going concern.

Management's plans in regard to these matters are also described in Note 1.

The financial

statements do not include any adjustments that might result from the outcome of this uncertainty.

The accompanying consolidated financial

statements have been prepared assuming that the Company will continue as a going concern.

As discussed in Note 1 to the

financial statements, the Company has suffered recurring losses from operations and has a net capital deficiency that raises

substantial doubt about its ability to continue as a going concern.

Management's plans in regard to these matters are also

described in Note 1.

The financial statements do not include any adjustments that might result from the outcome of this

/s/ Whitley Penn LLP

Dallas, Texas

January 25, 2017

Financial Gravity Companies, Inc.

February 19, 2018

Financial Gravity

Companies, Inc.

and Subsidiaries

CONSOLIDATED BALANCE SHEETS

CONSOLIDATED BALANCE

As of September

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Cash and cash equivalents

Trade accounts receivable

Trade accounts receivable, net

Accounts receivable - related party

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Accounts payable - trade

Accounts payable - related party

Accrued expenses

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Total current liabilities

NOTES PAYABLE

STOCKHOLDERS’

Common stock - 300,000,000 shares authorized;

$0.001 par value

Common stock, $0.001 par value;

300,000,000 shares authorized;

35,737,900 shares issued and outstanding as of September 30, 2017 and 34,862,900 shares issued and outstanding as of September 30, 2016

Additional paid-in capital

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Total stockholders’

The accompanying notes are in integral part

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY

The accompanying notes are an integral part

of these consolidated financial statements.

Financial Gravity Companies, Inc.

Financial Gravity

Companies, Inc.

and Subsidiaries

CONSOLIDATED STATEMENTS OF OPERATIONS

CONSOLIDATED STATEMENTS

OF OPERATIONS

Years Ended September

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Net operating loss

OTHER INCOME (EXPENSE)

OTHER EXPENSE

Interest expense

Total other (expense) income

Total other expense

$ (2,135,139 )

EARNINGS PER SHARE - Basic and Diluted

The accompanying notes are in integral part

LOSS PER SHARE - Basic and Diluted

The accompanying notes are an integral part

of these consolidated financial statements.

Financial Gravity Companies, Inc.

Financial Gravity

Companies, Inc.

and Subsidiaries

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’

For the years ended September 30, 2016 and 2015

CONSOLIDATED STATEMENTS

OF CHANGES IN STOCKHOLDERS’

For the years

ended September 30, 2017 and 2016

Number of Shares Issued and Outstanding

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Balance at September 30, 2015

Common stock issued

Common stock issued under a private placement memorandum

Common stock issued to non-employee directors

Common stock issued on acquisition of Cloud9 Holdings, LLC

Gain on acquisition of BLI and PAG

Balance at September 30, 2015

Common stock issued under a private placement memorandum

Common stock issued on acquisition of Tax Coach Software, LLC (shares placed in escrow)

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Balance at September 30, 2016

Common stock issued under a private placement memorandum

Release of Pacific Oil Company shares for settlement of pre-acquisition liabilities

Common stock issued in exchange for services

Stock based compensation

Balance at September 30, 2017

$ (4,054,998 )

The accompanying notes are in integral part

The accompanying notes are an integral part

of these consolidated financial statements.

Financial Gravity Companies, Inc.

Financial Gravity

Companies, Inc.

and Subsidiaries

CONSOLIDATED STATEMENTS OF CASH FLOWS

CONSOLIDATED STATEMENTS

OF CASH FLOWS

Years Ended September

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Forfeiture of deposit for failed acquisition

Write off of fixed assets

Common stock issued in exchange for services

Stock based compensation

Changes in operating assets and liabilities, net of effects of purchase of subsidiaries

Trade accounts receivable

Trade accounts receivable, net

Accounts receivable - related party

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Deferred revenue

Pre-merger payables

Net cash used in operating activities

CASH FLOWS FROM INVESTING ACTIVITIES

Payments for purchase of investment

Cash from the sale of investment

Cash paid for purchase of property and equipment

Cash paid for purchase of MDP

Cash acquired upon acquisition of subsidiaries

Deposit for future acquisition

Payments for purchase of investment

Purchases of trademarks

Net cash provided by (used in) investing activities

Net cash (used in) provided by investing activities

CASH FLOWS FROM FINANCING ACTIVITIES

Borrowings on line of credit

Payments on line of credit

Borrowings on note payable

Borrowings from line of credit

Borrowings from note payable

Payments on note payable

Payments on capital lease obligations

Payments on line of credit

Proceeds from the sale of common stock

Net cash provided by financing activities

TOTAL (DECREASE)/INCREASE IN CASH AND CASH EQUIVALENTS

TOTAL INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS

CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR

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Non-cash activities:

Common stock issued upon acquisition of:

Cloud9 Holdings Company (Note 9)

Tax Coach Software, LLC (Note 9)

Common stock issued upon acquisition of Tax Coach Software, LLC (Note 9)

Net assets (liabilities) assumed for purchase of:

Cloud9 Holdings Company (Note 9)

Business Legacy, Inc.

and Pollock Advisory Group, Inc.

Tax Coach Software, LLC (Note 9)

Payables owed by Pacific Oil Company

Equity in escrow to offset payables owed by legacy Pacific Oil Company

Transfer of capital lease obligation to the majority member

The accompanying notes are in integral

part of these consolidated financial statements.

Equity in escrow to offset payables owed by Pacific Oil Company

Settlement of payables owed by legacy Pacific Oil Company Stockholders

The accompanying notes are an integral part of these consolidated

financial statements.

Financial Gravity Companies, Inc.

and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO CONSOLIDATED FINANCIAL

NATURE OF BUSINESS

Financial Gravity Companies, Inc.

Subsidiaries (“the Company”) is located in Allen, Texas.

and Subsidiaries

(the “Company”) is located in Allen, Texas.

The wholly-owned subsidiaries of the organization include:

Financial Gravity Holdings, Inc., Financial Gravity Operations, Inc., Financial Gravity Tax, Inc., Financial Gravity Wealth, Inc.,

Cloud9 Holdings Company, Financial Gravity Business, LLC, Financial Gravity Ventures, LLC., SASH Corporation (doing business as

Metro Data Processing) and Tax Coach Software, LLC.

Financial Gravity

Holdings, Inc., Financial Gravity Operations, Inc., Financial Gravity Tax, Inc., Financial Gravity Wealth, Inc., Cloud9 Holdings

Company, Financial Gravity Business, LLC, Financial Gravity Ventures, LLC., SASH Corporation (doing business as Metro Data Processing)

and Tax Coach Software, LLC.

Financial Gravity Holdings, Inc.

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(“FGV”)

formerly Cloud9 Accelerator, LLC was acquired by Cloud9 Holdings Company effective December 31, 2014 and holds acquired companies

and business assets until they are integrated into the main stream Financial Gravity business structure.

FGV does not have any

financial activity through September 30, 2016.

formerly Cloud9 Accelerator, LLC was acquired by Cloud9 Holdings Company (Cloud9) effective December 31, 2014 and holds acquired

companies and business assets until they are integrated into the main stream Financial Gravity business structure.

have any financial activity through September 30, 2017.

Effective January 1, 2015, Cloud9 assigned

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Financial Gravity Tax, Inc.

Tax”) formerly Business Legacy, Inc., (“BLI”) was acquired by FGO for no cost effective January 1, 2015 and is

located in Allen, Texas.

BLI is a bookkeeping, tax planning, tax preparation, and payroll service provider to small companies and

(“FG Tax”)

formerly Business Legacy, Inc., (“BLI”) was acquired by FGO for no cost effective January 1, 2015 and is located in

Allen, Texas.

BLI is a bookkeeping, tax planning, tax preparation, and payroll service provider to small companies and individuals.

Financial Gravity Wealth, Inc.

Wealth”) formerly Pollock Advisory Group, Inc., (“PAG”) was acquired by FGO for no cost effective January 1,

2015 and is a registered investment advisor, located in Allen, Texas.

(“FG Wealth”)

formerly Pollock Advisory Group, Inc., (“PAG”) was acquired by FGO for no cost-effective January 1, 2015 and is a registered

investment advisor, located in Allen, Texas.

PAG provides asset management services.

SASH Corporation, an Oklahoma corporation

doing business as Metro Data Processing (“MDP”) was acquired August 12, 2015.

SASH Corporation, an Oklahoma corporation doing

business as Metro Data Processing (“MDP”) was acquired August 12, 2015.

The purchase was made by Cloud9Accelerator,

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

A summary of the significant accounting

polices consistently applied in the preparation of the accompanying consolidated financial statement in accordance with accounting

principles generally accepted in the United States of America (“GAAP”) is as follows.

A summary of the significant accounting polices

consistently applied in the preparation of the accompanying consolidated financial statement in accordance with accounting principles

generally accepted in the United States of America (“GAAP”) is as follows.

Basis of Consolidation

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date of acquisition), BLI (from the date of acquisition), TCS (from the date of acquisition), and MDP (from the date of acquisition),

(collectively referred to as “the Company”).

(collectively referred to as the “Company”).

All significant intercompany accounts and transactions have been eliminated

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Cash and Cash Equivalents

The Company considers all highly liquid

investments with an initial maturity of three months or less, when purchased, to be cash equivalents.

The Company maintains cash

balances at several financial institutions located throughout the United States, which at times may exceed insured limits.

Company has not experienced any losses in such accounts and believes it is not exposed to any significant credit risk on cash and

cash equivalents.

The Company considers all highly liquid investments

with an initial maturity of three months or less, when purchased, to be cash equivalents.

The Company maintains cash balances at

several financial institutions located throughout the United States, which at times may exceed insured limits.

The Company has

not experienced any losses in such accounts and believes it is not exposed to any significant credit risk on cash and cash equivalents.

Trade Accounts Receivable

Trade accounts receivable are carried at

the invoiced amount less an estimate made for doubtful accounts based on management’s review of outstanding balances.

collectability of the Company’s accounts receivable is reviewed on an ongoing basis, using historical payment trends and

a review of specific accounts.

Trade accounts receivable are

carried at the invoiced amount less an estimate made for doubtful accounts based on management’s review of outstanding balances.

The collectability of the Company’s accounts receivable is reviewed on an ongoing basis, using historical payment trends

and a review of specific accounts.

Accounts receivable are written off after all reasonable collection efforts have been exhausted

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Recoveries of receivables previously written off are recorded when

There was no allowance for doubtful accounts recorded as of September 30, 2016 and 2015.

In the normal course of business, the Company

may extend credit to its customers, on an unsecured basis, substantially all of whom are located in the United States of America.

The allowance for doubtful accounts was $17,014 and $-0- as of September 30, 2017 and 2016, respectively.

In the normal course of business,

the Company may extend credit to its customers, on an unsecured basis, substantially all of whom are located in the United States

The Company does not believe that they are exposed to any significant risk of loss on accounts receivable.

Prepaid Expenses

Prepaid expenses consist of expenses the

Company has paid for prior to the service or good being provided.

These prepaid expenses will be recorded as expense at the time

the service has been provided.

Prepaid expenses consist of expenses the Company

has paid for prior to the service or good being provided.

These prepaid expenses will be recorded as expense at the time the service

has been provided.

Property and Equipment

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over their estimated service lives by the straight-line method.

Maintenance and repairs are charged to

earnings as incurred;

Maintenance and repairs are charged to earnings

major repairs and replacements are capitalized.

When items of property or equipment are sold or retired,

the related cost and accumulated depreciation are removed from the accounts and any gain or loss is included in operations.

When items of property or equipment are sold or retired, the related

cost and accumulated depreciation are removed from the accounts and any gain or loss is included in operations.

Property and equipment operated under material

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Customer Relationships

The customer relationships acquired from

the TCS purchase have been recognized in the accompanying consolidated balance sheets at $44,900, the value attributed to it on

the date of the purchase (see Note 9).

The customer relationships are being amortized on a straight-line basis over a four-year

estimated life.

During the year ended September 30, 2016, the Company recorded amortization expense of $11,225 on this intangible

The customer relationships acquired from the

TCS purchase have been recognized in the accompanying consolidated balance sheets at $44,900, the value attributed to it on the

date of the purchase (see Note 9).

The customer relationships are being amortized on a straight-line basis over a four- year estimated

During the years ended September 30, 2017 and 2016, the Company recorded amortization expense of $11,225 on this intangible

asset, which is included in depreciation and amortization expense in the accompanying consolidated statements of operations.

amortization at September 30, 2016 was $11,225.

Future amortization of customer relationships is estimated to

be as follows for the years ended September 30:

amortization at September 30, 2017 and 2016 was $22,450 and $11,225, respectively.

Future amortization of customer relationships

is estimated to be as follows for the years ended September 30:

Proprietary Content

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estimated life.

During the year ended September 30, 2016, the Company recorded amortization expense of $65,638 on this intangible

asset, which is included in depreciation and amortization expense in the accompanying consolidated statements of operations.

amortization at September 30, 2016 was $65,638.

Future amortization of proprietary content is estimated to

be as follows for the years ended September 30:

The trade name acquired as a part of the

TCS purchase has been recognized in the accompanying consolidated balance sheets at $69,300, the value attributed to it on the

date of the purchase (see Note 9).

Management has determined that the trade name has an indefinite life and does not consider the

value of the trade name recorded in the accompanying consolidated balance sheet to be impaired as of September 30, 2016.

Prospect List

The prospect list acquired as a part of

the TCS purchase has been recognized in the accompanying consolidated balance sheets at $53,800, the value attributed to it on

the date of the purchase (see Note 9).

The prospect list is being amortized on a straight-line basis over a one-year estimated

During the year ended September 30, 2016, the Company recorded the full amortization expense of $53,800 on this intangible

asset, which is included in depreciation and amortization expense in the accompanying consolidated statements of operations.

amortization at September 30, 2016 was $53,800.

During the years ended September 30, 2017 and 2016, the Company recorded amortization expense of $65,638 on this

intangible asset, which is included in depreciation and amortization expense in the accompanying consolidated statements of operations.

Accumulated amortization at September 30, 2017 and 2016 was $131,276 and $65,638, respectively.

Future amortization of proprietary content

is estimated to be as follows for the years ended September 30:

The trade name acquired as a part of the TCS

purchase has been recognized in the accompanying consolidated balance sheets at $69,300, the value attributed to it on the date

of the purchase (see Note 9).

Management has determined that the trade name has an indefinite life and does not consider the value

of the trade name recorded in the accompanying consolidated balance sheet to be impaired as of September 30, 2017 and 2016.

Non-compete Agreements

Non-compete agreements established as a

part of the TCS purchase have been recognized in the accompanying consolidated balance sheets at $26,300, the value attributed

to them on the date of the purchase (see Note 9).

The non-compete agreements are being amortized on a straight-line basis over

the five-year term of the non-compete clause of the agreement.

During the year ended September 30, 2016, the Company recorded amortization

Non-compete agreements established as a part

of the TCS purchase have been recognized in the accompanying consolidated balance sheets at $26,300, the value attributed to them

on the date of the purchase (see Note 9).

The non-compete agreements are being amortized on a straight-line basis over the five-year

term of the non-compete clause of the agreement.

During the years ended September 30, 2017 and 2016, the Company recorded amortization

expense of $5,260 on this intangible asset, which is included in depreciation and amortization expense in the accompanying consolidated

statements of operations.

Accumulated amortization at September 30, 2016 was $5,260.

Future amortization of the non-compete agreements is estimated

to be as follows for the years ended September 30:

The Company accounts for trademarks in

accordance with GAAP and accordingly, trademarks are stated at cost.

Trademarks with indefinite lives are not amortized but are

tested for impairment at least annually.

Management has determined that the trademarks have an indefinite life and do not consider

the value of trademarks recorded in the accompanying consolidated balance sheet to be impaired as of September 30, 2016 and 2015.

Goodwill represents the excess of the

value of the purchase price and related costs over the identifiable assets from business acquisitions.

The Company conducts an

annual impairment assessment, at the reporting unit level, of its recorded goodwill.

The Company assesses qualitative factors

in order to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount.

The qualitative factors evaluated by the Company include:

macro-economic conditions of the local business environment, overall

financial performance, and other entity specific factors as deemed appropriate.

If, through this qualitative assessment, the conclusion

is made that it is more likely than not that a reporting unit’s fair value is less than its carrying amount, a two-step

impairment test is performed.

Management determined, by assessing the qualitative factors, that it is more likely than not that

the fair value of the reporting unit is greater than its carrying value.

Management does not consider the value of goodwill recorded

for TCS in the accompanying consolidated balance sheet to be impaired as of September 30, 2016, and 2015.

However, goodwill attributed

to Cloud9 and MDP was deemed to be impaired as that business offering has been discontinued.

The fair values of the assets acquired

and liabilities assumed were determined primarily using the income approach, which determines the fair value for the asset based

on the present value of cash flows projected to be generated by the asset.

Accumulated amortization at September 30, 2017 and 2016 was $10,520 and $5,260, respectively.

Future amortization of the non-compete agreements

is estimated to be as follows for the years ended September 30:

The Company accounts for trademarks in accordance

with GAAP and accordingly, trademarks are stated at cost.

Trademarks with indefinite lives are not amortized but are tested for

impairment at least annually.

Management has determined that the trademarks have an indefinite life and do not consider the value

of trademarks recorded in the accompanying consolidated balance sheet to be impaired as of September 30, 2017 and 2016.

Goodwill represents the excess of the value

of the purchase price and related costs over the identifiable assets from business acquisitions.

The Company conducts an annual

impairment assessment, at the reporting unit level, of its recorded goodwill.

The Company assesses qualitative factors in order

to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount.

The qualitative

factors evaluated by the Company include:

macro-economic conditions of the local business environment, overall financial performance,

and other entity specific factors as deemed appropriate.

If, through this qualitative assessment, the conclusion is made that it

is more likely than not that a reporting unit’s fair value is less than its carrying amount, a two-step impairment test is

Management determined, by assessing the qualitative factors, that it is more likely than not that the fair value of

the reporting unit is greater than its carrying value.

Management does not consider the value of goodwill recorded for TCS in the

accompanying consolidated balance sheet to be impaired as of September 30, 2017, and 2016.

However, goodwill attributed to Cloud9

and MDP was deemed to be impaired as of September 30, 2016 as that business offering has been discontinued.

The fair values of the assets acquired, and

liabilities assumed were determined primarily using the income approach, which determines the fair value for the asset based on

the present value of cash flows projected to be generated by the asset.

Projected cash flows are discounted at a rate of return

2 unchanged sentences

by projecting expected cash flows and subtracting the portion of the cash flow derived by the relevant contributory assets.

The accompanying consolidated balance sheets,

consolidated statements of operations, changes in stockholders’

equity and cash flows include the results of operations of

the acquired subsidiaries from the date of acquisition.

The accompanying consolidated balance sheets, consolidated statements

of operations, changes in stockholders’

equity and cash flows include the results of operations of the acquired subsidiaries

from the date of acquisition.

Goodwill consists of the following:

Goodwill at September 30, 2015

Goodwill generated from acquisition of Cloud9 (see note 9)

Goodwill generated from acquisition of MDP (see note 9)

Goodwill at September 30, 2015

Goodwill generated from acquisition of TCS (see note 9)

Goodwill generated from acquisition of TCS

Impairment of Cloud9

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Goodwill at September 30, 2016

Goodwill at September 30, 2017

The Company accounts for Federal and state

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taxes based on tax effects of differences between the financial statement and tax basis of assets and liabilities.

The Company accounts for all uncertain

tax positions in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”)

The Company accounts for all uncertain tax

positions in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”)

Income Taxes (“ASC 740”).

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There was no accrued interest or penalties as of September 30, 2017 and 2016.

From time to time, the Company is audited

by taxing authorities.

From time to time, the Company is audited by

taxing authorities.

These audits could result in proposed assessments of additional taxes.

The Company believes that its tax

positions comply in all material respects with applicable tax law.

However, tax law is subject to interpretation, and interpretations

by taxing authorities could be different from those of the Company, which could result in the imposition of additional taxes.

The Company believes that its tax positions

comply in all material respects with applicable tax law.

However, tax law is subject to interpretation, and interpretations by

taxing authorities could be different from those of the Company, which could result in the imposition of additional taxes.

Company’s Federal returns since 2014 are still subject for examination by taxing authorities.

Earnings Per Share

Basic earnings per common share is computed

by dividing net earnings available to common stockholders by the weighted average number of common shares outstanding for the reporting

Average number of common shares were 31,626,189 and 24,769,739 for years ended September 30, 2016 and 2015, respectively.

Basic earnings per common share is

computed by dividing net earnings available to common stockholders by the weighted average number of common shares

outstanding for the reporting period.

Average number of common shares were 35,361,321 and 31,626,189 for years ended

September 30, 2017 and 2016, respectively.

For the years ended September 30, 2017

and 2015, approximately 2,200,346 and 1,500,996 common stock options, respectively, were not added to the diluted average shares

because inclusion of such shares would be antidilutive.

and 2016, approximately 2,817,146 and 2,200,346 common stock options, respectively, were not added to the diluted average

shares because inclusion of such shares would be antidilutive.

Revenue Recognition

FG Wealth generates investment management

fees for services provided by the Company.

Investment management fees include fees earned from assets under management by providing

professional services to manage client investments.

FG Tax and MDP generate service income from its consulting and

other professional services performed.

Commission revenue is derived from the

sale of annuities and premiums on life insurance policies held by third parties.

The revenue is recognized at the time the policy

Revenue represents gross billings less

discounts, and are net of sales taxes, as applicable.

Amounts invoiced for work not yet completed are shown as deferred revenue

in the accompanying consolidated balance sheets.

TaxCoach Software has 3 types of

services that are charged and collected on a month to month subscription basis (TaxCoach basic membership, All-Stars

coaching, and Wire Service weekly broadcast email).

None of these programs come with a long-term commitment or contract, and

there is no up-front payment beyond the monthly subscription fee.

Cancellations are processed within the month

requested and memberships are closed at the end of the period for which the most recent payment was made.

not entitled to refunds for unused memberships.

FG Wealth generates investment management fees for services provided

by the Company.

Investment management fees include fees earned from

assets under management by providing professional services to manage

client investments.

FG Tax and MDP generate service income from its consulting and other

professional services performed.

Commission revenue is derived from the sale

of annuities and premiums on life insurance policies held by third parties.

The revenue is recognized at the time the policy is

Revenue represents gross billings less discounts,

and are net of sales taxes, as applicable.

Amounts invoiced for work not yet completed are shown as deferred revenue in the accompanying

consolidated balance sheets.

TaxCoach Software has 3 types of services that

are charged and collected on a month to month subscription basis (TaxCoach basic membership, All-Stars coaching, and Wire Service

weekly broadcast email).

None of these programs come with a long-term commitment or contract, and there is no up-front payment

beyond the monthly subscription fee.

Cancellations are processed within the month requested and memberships are closed at the end

of the period for which the most recent payment was made.

Members are not entitled to refunds for unused memberships.

Advertising costs are charged to operations

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Stock-Based Compensation

The Company recognizes the fair value

of the stock-based compensation awards as wages in the accompanying statements of operations on a straight-line basis over the

vesting period based on the Black-Scholes option pricing model based on a risk free rate from 0.70% in 2015 and 0.97% in 2016,

dividend yield of 0%, expected life of 2 years and volatility of 1.00.

The Company recognizes the fair value of the

stock-based compensation awards as wages in the accompanying statements of operations on a straight-line basis over the vesting

period based on the Black-Scholes option pricing model based on a risk-free rate from 0.85% to 1.41% in 2017 and 0.97% in 2016,

dividend yield of 0%, expected life of 2 years and volatility of 43% to 137%.

Use of Estimates

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Going Concern

The accompanying consolidated financial

statements have been prepared assuming that the Company will continue as a going concern, which contemplates the Company will need

to manage additional asset units under contract and/or additional financing to fully implement its business plan, including continued

growth and establishment of a stronger brand.

The Company is actively seeking growth

of its service offerings, both organically and via new client relationships.

Management, in the ordinary course of business, is

trying to raise additional capital through sales of common stock as well as seeking financing via equity or debt, or both from

third parties.

The accompanying consolidated financial statements

have been prepared assuming that the Company will continue as a going concern, which contemplates the Company will need to manage

additional asset units under contract and/or additional financing to fully implement its business plan, including continued growth

and establishment of a stronger brand.

On May 23, 2017, the Company and GHS

Investments, LLC (“GHS Investments”) entered into an Equity Financing Agreement (the “Agreement”).

Agreement was filed as an exhibit to a registration statement on Form S-1, filed with the Securities and Exchange Commission on

September 18, 2017.

The Agreement contemplates a series of transactions, pursuant to which the Company will “put”

of its common stock to GHS in consideration of the payment to the Company of eighty percent (80%) of the “Market Price”

of such shares.

“Market Price”

shall mean the average of the two lowest trading prices of the Company’s Common

Stock during the ten (10) consecutive trading days preceding the receipt of the applicable put notice.

Accordingly, on each instance

the Company exercises a put option, the Company will know in advance, both the number of shares issuable upon exercise of the put

option, and the dollar amount of the purchase price for such shares.

The maximum purchase price for shares to be purchased by GHS

Investments under the Agreement is $11,000,000.

To facilitate the sale of the shares so purchased by GHS Investments, the Company

agreed to file a registration statement with the Securities and Exchange Commission.

The Company also entered into a Registration

Rights Agreement with GHS Investments, pursuant to which the Company has agreed to provide certain registration rights under the

Securities Act of 1933, the rules and regulations promulgated thereunder, and applicable state securities laws.

The Agreement will

terminate (i) when GHS Investments has purchased an aggregate of $11,000,000 of the common stock of the Company, or (ii) 36 months

after the effective date of the Agreement, or (iii) at such time that the registration statement is no longer in effect.

Additionally, the Company is also actively seeking growth of

its service offerings, both organically and via new client relationships.

Management, in the ordinary course of business, is trying

to raise additional capital through sales of common stock as well as seeking financing via equity or debt, or both from third

There are no assurances that additional financing will be available on favorable terms, or at all.

If additional

financing is not available, the Company will need to reduce, defer or cancel development programs, planned initiatives and overhead

expenditures.

The failure to adequately fund its capital requirements could have a material adverse effect on the Company’s

business, financial condition and results of operations.

Moreover, the sale of additional equity securities to raise financing

will result in additional dilution to the Company’s stockholders, and incurring additional indebtedness could involve an

increased debt service cash obligation, the imposition of covenants that restrict the Company’s operations or the Company’s

ability to perform on its current debt service requirements.

The consolidated financial statements do not include any adjustments

that might be necessary if the Company is unable to continue as a going concern.

If additional financing

is not available, the Company will need to reduce, defer or cancel development programs, planned initiatives and overhead expenditures.

The failure to adequately fund its capital requirements could have a material adverse effect on the Company’s business,

financial condition and results of operations.

Moreover, the sale of additional equity securities to raise financing will result

in additional dilution to the Company’s stockholders and incurring additional indebtedness could involve an increased debt

service cash obligation, the imposition of covenants that restrict the Company’s operations or the Company’s ability

to perform on its current debt service requirements.

The consolidated financial statements do not include any adjustments that

might be necessary if the Company is unable to continue as a going concern.

Future Accounting Pronouncements

In April 2015, the FASB issued ASU No.

2015-15, Interest –

Imputation of Interest (Subtopic 835-30):

Simplifying the Presentation of Debt Issuance Costs, part of

the FASB’s simplification initiative.

ASU 2015-15 requires companies to present debt issuance costs the same way they currently

present debt discounts, as a direct deduction from the carrying value of that debt liability.

ASU 2015-15 does not impact the recognition

and measurement guidance for debt issuance costs.

ASU 2015-15 is effective for fiscal years beginning after December 15, 2015.

In November 2015, the FASB issued ASU No.

2015-17, Income Taxes (Topic 740):

Balance Sheet Classification of Deferred Taxes, part of the FASB’s simplification initiative.

ASU 2015-17 requires companies to classify deferred tax liabilities and assets as noncurrent.

ASU 2015-17 is effective for fiscal

years beginning after December 15, 2018.

In February 2016, the FASB issued ASU

In February 2016, the FASB issued ASU Update

2016-02 Leases (Topic 842).

Under the new guidance, a lessee will be required to recognize assets and liabilities

for leases with lease terms of more than 12 months.

Consistent with current GAAP, the recognition, measurement, and

presentation of expenses and cash flows arising from a lease by a lessee primarily will depend on its classification as a

finance or operating lease.

However, unlike current GAAP - which requires only capital leases to be recognized on the balance

sheet - the new ASU will require both types of leases to be recognized on the balance sheet.

ASU 2016-02 is effective for the

years beginning after December 15, 2018 and for all periods presented.

Early application of the amendments in this ASU is

In March 2016, the FASB issued ASU Update

Under the new guidance, a lessee will be required to recognize assets and liabilities for leases

with lease terms of more than 12 months.

Consistent with current GAAP, the recognition, measurement, and presentation of expenses

and cash flows arising from a lease by a lessee primarily will depend on its classification as a finance or operating lease.

unlike current GAAP - which requires only capital leases to be recognized on the balance sheet - the new ASU will require both

types of leases to be recognized on the balance sheet.

ASU 2016-02 is effective for the years beginning after December 15, 2018

and for all periods presented.

Early application of the amendments in this ASU is permitted.

The Company does not expect any significant

financial impact to the financial statements upon adoption of this standard.

In March 2016, the FASB issued ASU Update No.

2016-07, Investments –

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Early application of the amendments in this ASU is permitted.

In March 2016, the FASB issued ASU

does not expect any significant financial impact to the financial statements upon adoption of this standard.

In March 2016, the FASB issued ASU Update No.

2016-08, Revenue from Contracts with Customers (Topic 606).

The amendments in this Update are intended to improve

the operability and understandability of the implementation guidance on principal versus agent considerations by clarifying

the criteria in determining a principal versus agent relationship.

The core principle of the guidance is that an entity

should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the

consideration to which the entity expects to be entitled in exchange for those goods or services.

To achieve this core

principle, an entity should apply the following five steps:

(1) identify contracts with customers, (2) identify the

performance obligations in the contracts, (3) determine the transaction price, (4) allocate the transaction price to the

performance obligation in the contract, and (5) recognize revenue as the entity satisfies performance obligations.

guidance is effective for annual reporting periods beginning after December 15, 2017, including interim periods within that

reporting period.

Early application is permitted for annual reporting periods beginning after December 15, 2016, including

interim periods within that reporting period.

We are currently evaluating what impact adoption of this guidance will have on

our financial position, results of operations, cash flows and disclosures.

In March 2016, the FASB issued ASU Update

The amendments in this Update are intended to improve the operability

and understandability of the implementation guidance on principal versus agent considerations by clarifying the criteria in determining

a principal versus agent relationship.

The core principle of the guidance is that an entity should recognize revenue to depict

the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects

to be entitled in exchange for those goods or services.

To achieve this core principle, an entity should apply the following five

(1) identify contracts with customers, (2) identify the performance obligations in the contracts, (3) determine the transaction

price, (4) allocate the transaction price to the performance obligation in the contract, and (5) recognize revenue as the entity

satisfies performance obligations.

The new guidance is effective for annual reporting periods beginning after December 15, 2017,

including interim periods within that reporting period.

Early application is permitted for annual reporting periods beginning after

December 15, 2016, including interim periods within that reporting period.

We are currently evaluating what impact adoption of

this guidance will have on our financial position, results of operations, cash flows and disclosures.

The Company does not expect

any significant financial impact to the financial statements upon adoption of this standard.

In March 2016, the FASB issued ASU Update No.

2016-09, Compensation –

Stock Compensation (Topic 718).

The amendments in this Update are to simplify several aspects

of the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either

The amendments in this Update are to simplify several aspects of

the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either

equity or liabilities, and classification on the statement of cash flows.

3 unchanged sentences

this will have but will do during the next fiscal year.

The Company does not expect any significant financial impact to the financial

statements upon adoption of this standard.

PROPERTY AND EQUIPMENT

Property and equipment consist of the following at September 30:

Service Lives

Furniture and fixtures

Furniture, fixtures and equipment

Internally developed software

Less accumulated depreciation and amortization

Depreciation expense was $17,625 and $289 during the years ended

September 30, 2016 and 2015, respectively.

Depreciation expense was $17,622 and $17,625

during the years ended September 30, 2017 and 2016, respectively.

Trademarks consist of the following:

Trademarks at September 30, 2015

Trademarks purchased from related party at cost

Trademarks purchased at cost

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NOTES PAYABLE

With the acquisition of Tax Coach

Software, LLC, the Company also acquired a promissory note payable to The Huntington National Bank.

The note permits maximum

borrowings of $100,000.

With the acquisition of Tax

Coach Software, LLC, the Company also acquired a promissory note payable to The Huntington National Bank.

The note permits

maximum borrowings of $100,000.

Interest is paid monthly at prime plus 1.25% and the balance is due on demand.

The facility matures

in February 2017, is collateralized by substantially all assets of Tax Coach Software, LLC, and is secured by a personal

guarantee from Keith VandeStadt, a significant stockholder of the Company.

The balance outstanding under this note payable

matures in February 2018 (paid off on November 30, 2017), is collateralized by substantially all assets of Tax Coach Software,

LLC, and is secured by a personal guarantee from Keith VandeStadt, a significant stockholder of the Company.

balance outstanding under this note payable was $92,197 and $93,397 at September 30, 2017 and 2016, respectively.

The Company entered into a Business Loan and Security Agreement

to Small Business Financial Solutions, LLC, on October 28, 2016 in the amount of $100,000.

The transaction is structured as an

advance against assets.

The lender has a security interest in all collateral of the Company, and outstanding under this note payable

was $7,935 and $0 at September 30, 2017 and 2016, respectively.

On July 31, 2017, the Company entered into

a Promissory Note Payable with Fourly Enterprises, LLC (“Fourly”) in the amount of $50,000.

The interest rate

on the note is 20%.

The note matures on August 16, 2018.

Fourly is owned by the majority stockholder of the Company.

The outstanding

balance was $46,461 at September 30, 2017.

On August 9, 2017 the Company entered into

a Promissory Note Payable with Elmer Fink in the amount of $100,000.

The interest rate on the note is 10%.

The note matures

July 31, 2020.

The outstanding balance was $100,000 at September 30, 2017.

On August 9, 2017 the Company entered into

a Promissory Note Payable with Mike and Terri Ashby in the amount of $100,000.

The interest rate on the note is 10%.

note matures August 15, 2020.

The outstanding balance was $100,000 at September 30, 2017.

On September 5, 2017 the Company entered

into a Promissory Note Payable with Heleon Investment Company, Ltd.

in the amount of $100,000.

The interest rate on the

The note matures August 15, 2020.

The outstanding balance was $100,000 at September 30, 2017.

The Company’s maturities

of debt subsequent to September 30, 2017 are as follows:

ACCRUED EXPENSES

Accrued expenses consist of the following

at September 30:

Accrued expenses consist of the following at

September 30:

Accrued payroll

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upon inception in 2014.

Net operating losses (“NOL”) since that date total $3,079,023 as of September 30, 2016, and

may be carried forward to offset future taxable income;

accordingly, no current provision for income tax has been recorded in the

accompanying statements of operations.

Net operating losses (“NOL”) since that date total $3,233,265 as of September 30, 2017 and may

be carried forward to offset future taxable income;

accordingly, no current provision for income tax has been recorded in the accompanying

statements of operations.

NOL carry-forward benefits begin to expire in 2035.

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Tax benefit calculated at statutory rate

Expense not deductible

Impairment of goodwill

Changes to valuation allowance

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and income tax recognition of NOL carry-forwards.

The deferred tax assets and liabilities

in the accompanying consolidated balance sheets include the following components at September 30:

The deferred tax assets and liabilities in the accompanying consolidated

balance sheets include the following components at September 30:

Net non-current deferred tax assets:

Net operating loss carry-forward

Property and equipment

Net non-current deferred tax liabilities:

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that in the normal course of business, leases will be renewed or replaced by other leases.

Deposits represented a down payment of

$50,000 made on a potential purchase at September 30, 2015.

The application of the deposit to the purchase price was contingent

upon the completion of the acquisition.

This acquisition did not take place and this deposit was ultimately forfeited during the

year ended September 30, 2016.

Minimum future annual rental payments under

non-cancelable operating leases having original terms in excess of one year are as follows:

Contingencies

Under the terms of the TCS purchase agreement,

the common stock issued has been placed in escrow.

The sellers maintain the right to unwind this transaction under certain conditions

(see Note 9).

Pacific Oil Company still has some outstanding

payables that the previous owners are in process of liquidating.

Those liabilities have been shown here but are expected to be

settled by the previous owners.

However, shares of the Company are being held in escrow to cover the chance that these liabilities

will ultimately have to be settled by the Company.

Under the terms of the TCS purchase

agreement, the common stock issued has been placed in escrow.

The sellers maintain the right to unwind this transaction under

certain conditions.

One agreement with one of the employees was terminated during December 2016 (See Note 9).

At September 30, 2016, Pacific Oil Company

had some outstanding payables that the previous owners were in the process of liquidating.

Those liabilities have been shown

here but are expected to be settled by the previous owners.

Shares of the Company were held in escrow to cover the possibility

that these liabilities will ultimately have to be settled by the Company.

The liabilities were settled during 2017.

Legal Proceedings

From time to time, we are a party to or

otherwise involved in legal proceedings, claims and other legal matters, arising in the ordinary course of our business or otherwise.

A subsidiary of the Company is currently involved in one legal proceeding, the outcome of which will not be material to our ability

to operate or market our services, our consolidated financial position, results of operations or cash flows.

From time to time, we are a party to or otherwise

involved in legal proceedings, claims and other legal matters, arising in the ordinary course of our business or otherwise.

of the Company is currently involved in one legal proceeding, the outcome of which will not be material to our ability to operate

or market our services, our consolidated financial position, results of operations or cash flows.

BUSINESS ACQUISITIONS

Business Acquisition –

Effective December 31, 2014, the Company

completed the acquisition of Cloud9, a business consulting firm located in Allen, Texas.

Under the terms of the acquisition, the

Company acquired 100% of Cloud9’s stock in a stock exchange.

Total stock exchanged during the year ended September 30, 2015,

was approximately 1,314,477 shares, at par value of $0.001 per share, from the Company for all 40,000,000 shares of Cloud9.

as a result of this acquisition, is not deductible for tax purposes.

The transaction resulted in recording liabilities and goodwill

at a fair value of $592,369 as follows:

Common stock issued in stock exchange

Net liabilities assumed

Total value of the goodwill generated on acquisition

The tangible assets acquired and liabilities

assumed were as follows:

Assets acquired:

Accounts receivable

Prepaid expenses and deposits

Total tangible assets

Liabilities assumed:

Accounts payable

Accounts payable - intercompany eliminated upon consolidation

Accounts payable - related party

Total liabilities

Net acquired liabilities

The primary asset acquired from Cloud9 is

the expertise of Cloud9, which the Company believes it will be able to leverage in maximizing the benefits of consulting with

As of September 30, 2015, these factors contributed to a purchase price in excess of the fair value of

Cloud9’s tangible assets acquired, and, as a result, the Company has recorded goodwill in the amount of $592,369 in

connection with this transaction which is recorded in the accompanying consolidated balance sheets.

As noted in Note 1, the Company reviewed

the enterprise value of the Cloud9 entity in fiscal 2016 and determined that the value of Goodwill that was acquired was no longer

As such, $592,369 was written off during the year ended September 30, 2016.

Business Acquisition –

and Pollock Advisory Group, Inc.

Effective January 1, 2015 Financial Gravity

Operations, Inc.

completed the acquisition of Business Legacy, Inc.

and Pollock Advisory Group, Inc., related financial services

firms located in Allen, Texas.

Under the terms of the acquisition, the Company acquired 100% of stock of Business Legacy, Inc.

and Pollock Advisory Group, Inc., wholly-owned entities of the majority stockholder of Financial Gravity Holdings, Inc.

The transaction resulted in recording a gain within APIC (as

the entities were under common control) of $26,316 as follows:

Net assets acquired

Total gain on bargain purchase generated at acquisition of entities under

common control

The tangible assets acquired and liabilities

assumed were as follows:

Assets acquired:

Accounts receivable

Accounts receivable - related party

Prepaid expenses

Total tangible assets

Liabilities assumed:

Accounts payable

Accrued expenses

Line of credit

Capital lease obligations

Total liabilities

Net acquired assets

The primary asset acquired from Business

and Pollock Advisory Group is the expertise in the respective area of service.

The Company believes they will be able

to leverage this expertise in maximizing the benefits of consulting with customers.

The acquisition of these two entities increases

the additional services the Company can provide to high net worth individuals and business in accordance with the strategic business

plan of the Company.

Business Acquisition –

SASH Corporation

Metro Data Processing

Effective August 12, 2015, the Company

completed the acquisition of SASH Corporation, an Oklahoma corporation doing business as MDP.

The purchase was made by a subsidiary

of the Company, Cloud9 Accelerator, LLC.

Under the terms of the acquisition, the Company agreed to purchase 100% of stock of MDP

The terms also require two employees of MDP to continue working in their current role for a period of not less than

12 months and not less than 6 months for compensation of an amount that is not less than $30,000 and $24,000, respectively.

as a result of this acquisition, is not deductible for tax purposes.

MDP, located in Tulsa, Oklahoma, provides payroll services,

software, and support solutions to business owners.

The transaction resulted in recording assets and goodwill at a fair value

of $70,598 as follows:

Cash consideration

net assets acquired

Total value of the goodwill generated on acquisition

The tangible assets acquired and liabilities

assumed were as follows:

Assets acquired:

Accounts receivable

Accounts receivable - other

Total tangible assets

Liabilities assumed:

Accounts payable

Total liabilities

Net acquired assets

The primary asset acquired from MDP is

the expertise in the respective area of service.

The Company believes they will be able to leverage the expertise of MDP as a payroll

service provider in Oklahoma which will also allow for an expansion of services to provide further access to high net worth individuals

and businesses beyond the Dallas/Ft.

Worth area in accordance with the strategic business plan of the Company.

As noted in Note 1, the Company reviewed

the enterprise value of the MDP entity in fiscal 2016 and determined that the value of Goodwill that was acquired was no longer

As such, $70,598 was written off during the year ended September 30, 2016.

Business Acquisition –

Software, Inc.

Effective October 1, 2015, the Company

completed the acquisition of Tax Coach Software, LLC, an Ohio limited liability company (“Tax Coach Software”).

purchase was made by Financial Gravity Holdings, Inc.

Under the terms of the acquisition, the Company acquired 100% of Tax Coach

Software’s stock in a stock exchange.

Total stock exchanged was 6,000,000 shares (as amended), at par value of $0.001 per

share, from the Company for 100% of the shares of Tax Coach Software.

Goodwill, as a result of this acquisition, is not deductible

for tax purposes.

Certificates representing the shares were

required to be deposited in escrow as of the effective date of the acquisition.

As part of the purchase agreement documentation,

the Sellers maintained the right to unwind the transaction under certain conditions as described.

The Sellers also retained all

rights as shareholders while shares were held in escrow, including the right to vote.

Under the escrow agreement, if the average

daily closing price of the shares for any continuous 10-day trading period equals or exceeds $1.00 during the thirty-six months

following October 28, 2015, the Company had the right to cause the shares deposited in escrow to be distributed to the Sellers,

terminating any right to unwind the transaction.

If the shares did not trade as to provide a closing price during the thirty-six

months following October 28, 2015 or if the average daily closing price of the shares for any continuous 10-day trading period

failed to equal or exceed $1.00 during the thirty-six months following October 28, 2015, then no later than five days following

the conclusion of the thirty-six month period, the Sellers would have the right to unwind the acquisition of Tax Coach Software

by the Company and the Company would immediately transfer the ownership of Tax Coach Software back to the Sellers in exchange for

the return of common stock issued during the acquisition.

The closing price was defined as the last closing trade price for the

shares on an electronic bulletin board as reported by Bloomberg or on the NASDAQ Capital Market or the highest bid price as reported

on “pink sheets”

Tax Coach Software,

Effective October 1, 2015, the Company completed

the acquisition of Tax Coach Software, LLC, an Ohio limited liability company (“Tax Coach Software”).

was made by Financial Gravity Holdings, Inc.

Under the terms of the acquisition, the Company acquired 100% of Tax Coach Software’s

stock in a stock exchange.

Total stock exchanged was 6,000,000 shares (as amended), at par value of $0.001 per share, from the

Company for 100% of the shares of Tax Coach Software.

Goodwill, as a result of this acquisition, is not deductible for tax purposes.

Certificates representing the shares were required

to be deposited in escrow as of the effective date of the acquisition.

As part of the purchase agreement documentation, the Sellers

maintained the right to unwind the transaction under certain conditions as described.

The Sellers also retained all rights as shareholders

while shares were held in escrow, including the right to vote.

Under the escrow agreement, if the average daily closing price of

the shares for any continuous 10-day trading period equals or exceeds $1.00 during the thirty-six months following October 28,

2015, the Company had the right to cause the shares deposited in escrow to be distributed to the Sellers, terminating any right

to unwind the transaction.

If the shares did not trade as to provide a closing price during the thirty-six months following October

28, 2015 or if the average daily closing price of the shares for any continuous 10-day trading period failed to equal or exceed

$1.00 during the thirty-six months following October 28, 2015, then no later than five days following the conclusion of the thirty-six

month period, the Sellers would have the right to unwind the acquisition of Tax Coach Software by the Company and the Company would

immediately transfer the ownership of Tax Coach Software back to the Sellers in exchange for the return of common stock issued

during the acquisition.

The closing price was defined as the last closing trade price for the shares on an electronic bulletin

board as reported by Bloomberg or on the NASDAQ Capital Market or the highest bid price as reported on “pink sheets”

by Pink Sheets LLC (formerly the National Quotation Bureau, Inc.).

If listed for trading on the American

or New York Stock Exchange during the thirty-six months following October 28, 2015 it will be deemed to meet the $1.00 benchmark.

On November 11, 2016, the parties to the

escrow agreement agreed (in a Company Distribution Notice) that the average daily closing price of the shares had exceeded the

$1.00 threshold and accordingly, the shares were released from escrow and the right to unwind the Tax Coach Software acquisition

transaction terminated.

Three employment agreements were made as

a condition to the acquisition.

If listed for trading on the American or New York Stock Exchange

during the thirty-six months following October 28, 2015 it will be deemed to meet the $1.00 benchmark.

On November 11, 2016, the parties to the escrow

agreement agreed (in a Company Distribution Notice) that the average daily closing price of the shares had exceeded the $1.00 threshold

and accordingly, the shares were released from escrow and the right to unwind the Tax Coach Software acquisition transaction terminated.

Three employment agreements were made as a

condition to the acquisition.

Each agreement has an effective date as of November 1, 2015 and is effective for a period of three

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a 90-day termination clause.

One agreement requires certain services at a fixed fee of $3,500 per month, commencing on November

1, 2015 with a 90-day termination clause.

$444,650 in professional fees were paid under these 3 agreements in the year ended September

One agreement was terminated by the Company during December 2017.

One agreement requires certain

services at a fixed fee of $3,500 per month, commencing on November 1, 2015 with a 90-day termination clause.

$444,600 and $444,650

in professional fees were paid under these 3 agreements during the years ended September 30, 2017 and 2016, respectively.

Tax Coach Software, located in Cincinnati,

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coaching revenue and email marketing services for customers.

The transaction resulted in a fair value of the acquisition of $1,094,702 as follows:

The transaction resulted in a fair value of

the acquisition of $1,094,702 as follows:

Common stock issued in stock exchange at a value of $0.25 per share (as amended)

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Total intangible assets

The tangible assets acquired and liabilities

assumed were as follows:

The tangible assets acquired and liabilities assumed were as follows:

Assets acquired:

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Net acquired assets

The primary asset acquired from Tax Coach

Software is the proprietary content which includes a comprehensive platform of tax planning strategies including marketing and

instructional guides.

TCS will provide the Company with expertise in areas of service which expand beyond the Company’s current

service areas.

The Company believes they will also be able to leverage the use of the proprietary content in maximizing the benefits

of consulting with customers.

The acquisition of this entity increases the additional services the Company can provide to high

net worth individuals and business in accordance with its strategic business plan.

Supplemental Unaudited Pro Forma Information

As noted above, all acquisitions were

completed prior to or as of October 1, 2015.

Accordingly, fiscal year 2016 includes the full impact of all the acquisitions.

fiscal year 2015 acquisitions were effective at various parts of the year, and had each of the acquisitions been effective on

October 1, 2015, the revenue and net income/(loss) would be as follows:

Total Revenue

Net (Loss) / Income

TCS net income includes expenses for the

amortization of the definite lived intangibles of $82,123.

Operating expenses recognized in fiscal year 2015 were approximately

$4,000 for MDP and $660 for Cloud9.

The BLI and PAG acquisitions each had immaterial amounts of operating expenses associated with

Operating expenses recognized in fiscal year 2016 were approximately $44,000 for TCS.

The primary asset acquired from Tax Coach Software

is the proprietary content which includes a comprehensive platform of tax planning strategies including marketing and instructional

TCS will provide the Company with expertise in areas of service which expand beyond the Company’s current service

The Company believes they will also be able to leverage the use of the proprietary content in maximizing the benefits of

consulting with customers.

The acquisition of this entity increases the additional services the Company can provide to high net

worth individuals and business in accordance with its strategic business plan.

STOCKHOLDERS’

The Company is authorized to issue up to

300,000,000 shares of common stock, par value $0.001 per share.

The Company is authorized to issue up to 300,000,000 shares of common

stock, par value $0.001 per share.

Preferred Stock

The Company does not have a preferred stock

authorization in its articles of incorporation.

Financial Gravity Holdings, a subsidiary

of the Company, has authorized the issuance of up to 10,000,000 shares of preferred stock, by action of the Board of Directors.

The preferred stock authorization has not been formalized via the filing of an amendment to the certificate of formation of Financial

The Company does not have a preferred stock authorization in its

articles of incorporation.

Financial Gravity Holdings, a subsidiary of

the Company, has authorized the issuance of up to 10,000,000 shares of preferred stock, by action of the Board of Directors.

preferred stock authorization has not been formalized via the filing of an amendment to the certificate of formation of Financial

Gravity Holdings.

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For each of the Company and Financial Gravity

Holdings, its subsidiary, no preferred shares are issued or outstanding as of September 30, 2016 and 2015, respectively.

Private Placement Memorandum, Financial

Gravity Holdings

Holdings, its subsidiary, there were no preferred shares issued or outstanding as of September 30, 2017 and 2016.

As part of the sale of common

shares starting October 2016, the Company granted to investors who invest at value of $100,000 or above common stock

purchase warrants (the “Warrants”).

In the quarter ended December 31, 2016 there were three individual

investments of $100,000 for which the Company issued warrants for the purchase of 75,000 shares of common stock of the

Company at an exercise price of $1.25 per share for a 1-year term and an additional 75,000 shares of common stock of the

Company at an exercise price of $1.50 for a 2-year term.

In the quarter ended March 31, 2017 there were two individual

investments for an aggregate of $250,000 for which the Company issued warrants for the purchase of 50,000 shares of common

stock of the Company at an exercise price of $1.25 per share for a 1-year term and an additional 50,000 shares of common

stock of the Company at an exercise price of $1.50 for a 2-year term.

In the quarter ended September 30,

2017, there was one additional investment of $100,000 for which the Company issued warrants for the purchase of 25,000 shares

of common stock of the Company after exercise price of $1.25 per share for 1-year term and an additional 25,000 shares of

common stock of the Company at an exercise price of $1.50 for a 2-year term.

The Company follows the provisions of ASC

815, “Derivatives and Hedging”.

ASC 815 requires freestanding contracts that are settled in a company’s own

stock to be designated as an equity instrument, assets or liability.

Under the provisions of ASC 815, a contract designated as

an asset or liability must be initially recorded and carried at fair value until the contract meets the requirements for classification

as equity, until the contract is exercised or until the contract expires.

However, the Company determined that these warrants

should be accounted for as equity and as such no determination of fair value was necessary.

Private Placement Memorandum, Financial Gravity Holdings, Inc.

On October 31, 2014, Financial Gravity

issued a private placement memorandum (“PPM”) for stock purchases of up to 2,000,000 shares of common stock at a cost

of $1.00 and a par value of $0.00001, with a minimum purchase level of $50,000 per investor.

The subscription period initially

expired June 30, 2015, however, the Board of Directors extended the offering period indefinitely, and increased the number of shares

authorized for sale under the PPM incrementally to accommodate additional investor interest.

During the years ended September 30, 2016

and 2015, 785,000 shares and 5,625,000 shares, respectively, were issued under the PPM for $535,000 and $1,875,000 of additional

paid-in capital at September 30, 2016 and 2015, respectively.

Holdings, Inc.

issued a private placement memorandum (“PPM”) for stock purchases of up to 2,000,000 shares of common

stock at a cost of $1.00 and a par value of $0.00001, with a minimum purchase level of $50,000 per investor.

The subscription period

initially expired June 30, 2015, however, the Board of Directors extended the offering period indefinitely, and increased the number

of shares authorized for sale under the PPM incrementally to accommodate additional investor interest.

Additional Common Stock Issuances, Financial

Gravity Holdings

During the year ended September 30, 2015,

Financial Gravity Holdings issued 21,150,000 shares of common stock in addition to the shares sold under the PPM and common shares

issued in connection with the Cloud9 Holding Company acquisition that were discussed above.

Also during September 30, 2015, 300,000

common shares were issued to two non-employee directors.

During the year ended September 30, 2016,

one of the founding members of Financial Gravity Holdings forfeited 2,926,294 common shares, in addition to the issuance of shares

sold under the PPM and common shares issued in connection with the Tax Coach Software, LLC acquisition, both of which are discussed

Subsequent to September 30, 2016, Financial

Gravity Holdings has sold 350,000 shares of common stock.

Gravity Companies, Inc.

On April 1, 2017, the Company entered into

an agreement with FMW Media Works Corp (“FMW”), wherein FMW would provide television, production, and media analysis

to the Company.

The Company issued 50,000 shares of common stock, worth $52,500, to FMW along with $3,500 cash as payment for services.

On August 22, 2017, the Company issued

100,000 shares of common stock, worth $60,000 to Nationwide EZ Cash Flow in exchange for professional services.

During the years ended September 30,

2017 and 2016, 725,000 shares and 785,000 shares, respectively, were issued for $725,000 and $535,000, respectively.

Additional Common Stock Issuances, Financial Gravity

Holdings, Inc.

During the year ended September 30, 2016, one

of the founding members of Financial Gravity Holdings forfeited 2,926,294 common shares, in addition to the issuance of shares

sold under the PPM and common shares issued in connection with the Tax Coach Software, LLC acquisition.

During the year ended September 30, 2016, Financial

Gravity Holdings sold 350,000 shares of common stock.

Stock Split, Financial Gravity Holdings

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STOCK OPTION PLAN

Effective February 27, 2015, the Company

established the 2015 Stock Option Plan (the “Plan”).

Effective February 27, 2015, the Company established

the 2015 Stock Option Plan (the “2015 Plan”).

The Board of Directors of the Company has the authority and discretion

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The expiration date and exercise price are as established by the Board of Directors of the Company.

No option may be issued under

the Plan after February 27, 2017.

The last date any options were

granted under the 2015 Plan was March 14, 2016.

Effective November 22, 2016, the Company established

the 2016 Stock Option Plan (the “2016 Plan”).

The Board of Directors of the Company has the authority and discretion

to grant stock options.

The maximum number of shares of stock that may be issued and exercised under the Plan is 20,000,000.

individuals include any employee of the Company or any director, consultant, or other person providing services to the Company.

The expiration date and exercise price are as established by the Board of Directors of the Company.

The first date any options

were granted under the 2016 Plan was December 19, 2016.

Stock option activity is summarized as follows:

Shares Under Option

Value of Shares Under Option

Weighted Average Exercise Price

Weighted Average Remaining Contractual Life

Shares Under Option

Value of Shares Under Option

Weighted Average Exercise Price

Weighted Average Remaining Contractual Life

Outstanding - beginning of year

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Exercisable - end of year

All outstanding stock options at September

30, 2016 became immediately vested upon the completion of the reverse merger with Pacific Oil Company.

Total compensation expense

included in salaries and wages of previously unamortized stock compensation was $22,715 and $0 for the years ended September 30,

2016 and 2015, respectively.

All outstanding 2015 Plan stock options at

September 30, 2016 became immediately vested upon the completion of the reverse merger with Pacific Oil Company.

Most of the stock

options granted under the 2016 Plan have 2-year vesting periods but there were 20,000 options that vested at issuance.

Total compensation

expense included in salaries and wages of previously unamortized stock compensation was $50,773 and $22,715 for the years ended

September 30, 2017 and 2016, respectively.

Unamortized share-based compensation expense as of September 30, 2017 amounted to $249,033 which is expected to recognized

over the next 2 years.

RELATED PARTY TRANSACTIONS

Effective December 31, 2014, the Company

acquired Cloud9 (see Note 9).

The majority stockholder of Cloud9 Holdings Company is also a stockholder of the Company.

Effective January 1, 2015, the Financial

Gravity Operations, Inc.

also acquired BLI and PAG (see Note 9).

BLI and PAG were acquired at no cost from a major stockholder

Account receivable due for services performed

for a related party, included in accounts receivable –

related party in the accompanying consolidated

balance sheets was $-0- and $27,267 as of September 30, 2016, and 2015.

Accounts receivable due from the majority

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related party in the accompanying consolidated balance sheets

was $4,506 and $2,059 as of September 30, 2016, and 2015.

The Company also has a payable due to a

stockholder related to payment for services provided and repayment for goods (as incurred through the acquisition of Cloud9) and

services purchased on behalf of the Company of approximately $-0- and $2,300 as of September 30, 2016 and 2015.

This is included

in the consolidated balance sheets as accounts payable - related party.

was $4,506 as of September 30, 2017, and 2016.

Management fees paid to the majority stockholder

of the entity, included as management fees - related party in the accompanying consolidated statement of operations were $213,333

of the entity, included as management fees - related party in the accompanying consolidated statements of operations were $200,000

and $213,333 for fiscal 2017, and 2016.

A board member who is also a stockholder

provided services to the Company.

Expenses for these services totaled $49,000 and $9,020 for the years ending September 30, 2016,

and 2015, respectively, and were included as general and administrative expenses in the accompanying consolidated statement of

During the year ended September 30,

2016, a board member who is also a stockholder provided services to the Company.

Expenses for these services totaled $49,000

and were included as general and administrative expenses in the accompanying consolidated statement of operations.

no associated expenses during 2017.

On July 31, 2017, the Company entered into a Promissory Note Payable with Fourly Enterprises, LLC (“Fourly”) in

the amount of $50,000.

The interest rate on the note is 20%.

The note matures on August 16, 2018.

Fourly is owned by the majority

stockholder of the Company.

The outstanding balance was $46,461 at September 30, 2017.

SUBSEQUENT EVENTS

In addition to the 350,000 common shares

issued subsequent to September 30, 2016 for $350,000 and the Company has issued 150,000 warrants exercisable for $206,250.

In December 2016, the Company’s

board authorized 20 million shares to be made available under a new Stock Option Plan.

Subsequent to September 30, 2017, an aggregate of

100,000 shares of the Company’s common stock have been sold for $100,000.

Additionally, an aggregate of 50,000 warrants to

purchase the Company’s common stock have been issued in conjunction with the sale of the Company’s common

Subsequent to September 30, 2017, an aggregate of 375,500

options to purchase the Company’s common stock have been granted.

On November 30, 2017, the Company

paid off the remaining balance of the note payable to The Huntington National Bank.

On December 22, 2017, the Tax Cuts and Jobs Act (the “Act”) was signed into United States tax law, which among

other provisions will lower the corporate tax rate to 21%.

Given this date of enactment, our financial statements as of and

for the year ended September 30, 2017 do not reflect the impact of the Act.

The Company is in the process of analyzing the

potential aggregate impact of the Act and will reflect any such impact in the quarterly report for the period in which the

law was enacted.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 9A. Controls and Procedures