What changed in this filing

/stocks — the workspaceLOADING

Item 9A. Controls and Procedures

2019-01-15 compared with 2018-02-20 · 841 added, 752 removed, 667 unchanged (70% of the section changed)

1 unchanged sentence

Evaluation of Disclosure Controls and Procedures

The Company’s Chief Executive Officer

and Chief Financial Officer have evaluated the effectiveness of the Company’s disclosure controls and procedures as of September

The term “disclosure controls and procedures,”

as defined in Rule 13a-15(e) under the Securities Exchange

Act of 1934, as amended (the “Exchange Act”), means controls and other procedures of a company that are designed to

ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is

recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms.

recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of

achieving their objectives and management necessarily applies its judgment in evaluating the cost benefit relationship of possible

controls and procedures.

Based on its evaluation, management concluded as of September 30, 2018 that its disclosure controls and

procedures were not effective because of material weaknesses in our internal control over financial reporting, described below

in Management’s Report on Internal Control Over Financial Reporting.

Notwithstanding the identified material weaknesses,

management believes the financial statements included in this Annual Report on Form 10-K fairly represent in all material respects

our financial condition, results of operations and cash flows at and for the periods presented in accordance with U.S.

Management’s Report on Internal

Control Over Financial Reporting

The Company’s management is responsible

7 unchanged sentences

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

The Company’s Chief Executive Officer and Chief Financial Officer assessed the effectiveness of its internal

control over financial reporting as of September 30, 2018.

In making this assessment, its management used the criteria based on

the framework in Internal Control - Integrated Framework 2013 issued by the Committee of Sponsoring Organizations of

the Treadway Commission.

The Company’s Chief Executive Officer and Chief Financial Officer have concluded that, as of September

30, 2018, 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 Chief Executive Officer and Chief Financial Officer reviewed the results of his assessment

with its board of directors.

Based on its evaluation under this framework,

management concluded that its internal control over financial reporting was not effective as of the evaluation date due to the

factors stated below.

The Company has inadequate number of personnel with requisite expertise in the key functional areas of finance

and accounting to be able to have appropriately designed and operating entity level controls including risk assessment;

and communication;

and financial reporting.

Inadequate Segregation of

The Company has inadequate number of personnel to properly segregate duties to implement control procedures.

This annual report does not

include an attestation report of its Company’s independent registered public accounting firm regarding internal control

over financial reporting.

Management’s report was not subject to attestation by the Company’s independent 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

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.

10 unchanged sentences

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.

Changes in Internal Control over Financial

During the period covered by this report,

the following change was made 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:

The Company has implemented

a robust check disbursement policy that includes the following key control points:

first, the controller who handles check disbursements

is not an authorized signer on any bank account and cannot sign checks;

second, any disbursement amount less than $5,000.00 requires

written approval from one (1) member of the leadership team;

third, any disbursement amount of more than $5,000.00 and equal to

or less than $24,999.99 requires written approval of two (2) members of the leadership team;

fourth, any disbursement amount of

$25,000.00 or more requires approval by the Board of Directors;

and fifth, all disbursements are reviewed and approved by the Chief

Operating Officer.

As an additional control, all disbursement checks are signed by the CEO when available, and if the CEO is unable

to sign, disbursement checks are signed by a member of the leadership team.

All disbursements are controlled through a formal check

disbursement process that includes an official check disbursement request form.

This form is reviewed and signed by the appropriate

parties as referenced above.

The leadership team currently comprises the following members:

The Chief Executive Officer, the Chief

Operating Officer, the Chief Financial Officer, the Chief Tax Strategist, the Chief Sales Officer, and the Director of Operations.

OTHER INFORMATION.

1 unchanged sentence

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 2017.

Set forth below is certain information

regarding the persons who were directors and executive officers at any time during the fiscal year 2018.

Position with the Company

2 unchanged sentences

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

Chief Sales Officer

Chief Tax Strategist and Board Member

1 unchanged sentence

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

Michael Ashby

Todd Bourgeois

Debbie Buckner

President, Chief Operating Officer, 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 , 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 –

Williams, 62, has

served on the Financial Gravity Companies, Inc.

FGCO) 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.

He graduated from Austin College in Sherman,

Texas in 1978 and the Institute for Organization Management in Washington, DC in 1982.

Since 2007, Mr.

Williams has served as Chief Executive Officer

of Bison Financial Group, Inc., a corporate financial advisory and business development firm serving middle market growth companies.

Through Bison Financial Group, Mr.

Williams personally provides corporate financial advisory and business development consulting

Williams also currently serves as Chairman

of the Board of the following private companies:

Williams has served as Chief

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

growth companies.

Williams also serves as an officer

and director of two other public companies.

On behalf of Worldwide Specialty Chemicals, Inc.

based in Dallas, TX, Mr.

has served as Vice Chairman of the Board and Chief Financial Officer since 2018.

On behalf of Light Engine Design Corp.

based in Phoenix, AZ, Mr.

Williams has served as Chairman of the Board and Chief Financial Officer since 2017.

Williams also serves as an officer

and director of three other private companies.

Williams currently serves as:

Vice Chairman of the Board & Chief Financial

Officer of Dynamic Chemical Solutions, Inc.

in Frisco, Texas since 2016;

Chairman of the Board & Chief Financial Officer of

Curtis Mathes, Inc.

(since 2013);

Championship Sports Group, Inc.

(since 2012);

Triton Consolidated, Inc.

(since 2016);

Day One Consulting, Inc.

(since 2016);

and Investor Relations, Inc.

(since 2016).

also currently serves as Vice Chairman of the Board and Chief Financial Officer of Dynamic Chemical Solutions, Inc.

(since 2016),

and is on the Board of Directors of the Frisco (Texas) Chamber of Commerce.

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.

in Frisco, Texas since 2013;

and Chairman of the Board of Championship Sports Group, Inc.

in Frisco, Texas

Williams also currently serves on the Board of Directors and Executive Committee of the Frisco (Texas) Chamber

of Commerce and served as their Chairman of the Board in 2007.

In 2009, he was recognized as the CFO of the Year for North Texas

by the Dallas Business Journal.

Within the last five years, on behalf of

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.

Williams previously served as Vice Chairman of the Board, Treasurer, and Assistant Secretary

from 2009 to 2017, and served as Chief Financial Officer from 2009 to 2012 and from 2015 to 2017.

The breadth of Mr.

6 unchanged sentences

Over 40 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

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 Officer

Williams is serving as Chief Financial

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

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

Officer at Halo Companies, Inc., a public company, and Chairman of the Board and Chief Financial Officer of Light Engine Design

Corp., 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.

Before joining Financial Gravity in 2017, Mr.

Sundby served

as the Sales Manager-Columbus Division for Fischer Homes in Erlanger, KY from October 2013 to March 2017.

In that role, Mr.

was primarily responsible for recruiting, training, and leading sales teams for the Columbus Division.

Prior to joining Fischer

Homes, in October 2008 Mr.

Sundby founded Insurance Green Marketing Group in Colorado, where he recruited and trained sales teams

for an insurance marketing group and also operated as an independent sales agent in the insurance industry.

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 Chief Sales Officer for Financial

Gravity and is responsible for building the Company’s nationwide agent team.

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

in History from Hamilton

College in 1986 and a J.D.

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

1 unchanged sentence

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 , 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.

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

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.

degrees from Baylor University in 1989 and 1993, respectively.

Crumley currently

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.

Crumley currently 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.

David Myers , 66, has been

on the Board of Directors since August 28, 2018.

From 2013 to March 2018, he served as Vice President, Strategy & Analytics

for McGraw-Hill Education, a learning science company and one of the “big three”

educational publishers that provide customized educational content, software, and services for pre-K through postgraduate education.

At McGraw-Hill, he was responsible for market analytics, market research, pricing strategy, business and competitive intelligence,

state adoption planning and strategic planning.

From 2011 to 2013, Mr.

Myers served as Senior Manager, Business Development for

Mimio Interactive Teaching Technologies, which provides i nnovative, engaging, and affordable educational

technology and solutions that provide a better way to learn.

At Mimio, he was responsible for developing a team

and implementing a suite of business intelligence programs (market research, competitive intelligence, global market share and

financial scenario models).

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

that he should serve as a director for the Company:

A deep understanding of the role technology plays as an enabler of competitive business advantage

Deep experience building and leading skilled teams

Adept at applying marketing analytics, market research, pricing strategy and competitive intelligence to the strategic planning for enterprises

Skills in team-building, analytics, operations and organizational optimization

Michael Ashby , 65, has been

on the Board of Directors since August 28, 2018.

Since March 2015, he has managed a variety of consulting engagements -- both domestic

and internationally –

through his personal consulting company.

In January 2015, he served as a consultant for Ashby OpsComm,

an industrial consulting and engineering firm.

In that role, Mr.

Ashby as Startup

Manager for the Al Hosn super sour gas plant startup in the UAE –

and successfully brought on line the largest sour gas processing

plant in the world with no major incidents .

Ashby also spent over a decade with Occidental

Petroleum in a series of management roles with ever-growing responsibility, most recently as World Wide Engineering Chief

of Surface Operations and Engineering responsible for operations and technical support of all business units across the globe .

Ashby’s specific experience, qualifications, attributes or skills that led to the conclusion that he should serve

as a director for the Company:

Decades of experience working in complex project management

Strong people skills at all levels of an organization, from front-line workers to senior management

Superior planning and execution skills

Todd Bourgeois , 57, has been

on the Board of Directors since August 28, 2018.

Bourgeois has had a long career with Coca-Cola Bottlers, Inc.

(from 1982 forward),

most recently as Vice President of Business Integration for Coca-Cola Southwest Beverages.

In his most recent role, Mr.

was responsible for leading a team that spearheaded all Critical Business Transformation Projects throughout Coca Cola Southwest

Beverages, Inc.

including formulation of ROI Synergy initiatives as well as Operational Plans for execution of these projects.

He reported directly to the CEO of Coca-Cola Southwest Beverages and managed a Team of Project Coordinators, Analysts and multiple

external consultant teams (McKinsey, Deloitte, Accenture).

Bourgeois’

specific experience, qualifications, attributes

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

Over 30 years of experience managing diverse teams for a broad range of business improvement projects

Experience managing large sales and marketing organizations

Debbie Buckner , 55, has

been on the Board of Directors since August 28, 2018.

Immediately prior to joining the Company, Ms.

Buckner served as Chief Operations

Officer for CDR Electronics, a retail provider of consumer electronics, based in Oklahoma City.

Buckner served in that role

since 2017 and during her tenure, re-engineered the company’s organizational foundation to create clarity, discipline and

accountability.

She also exceeded the annual budget, and successfully led the implementation of several major company-wide initiatives.

From 2016 to 2017, Ms.

Buckner served as an independent consultant and coach, working in McKinney, Texas through two organizations:

with a focus on technology & experiential marketing;

and Nicka & Associates –

with a focus on medical

coding, compliance and education.

From 2005 to 2015, Ms.

Buckner worked for Crossmark, a sales and marketing services company

in the consumer goods and services industry, based in Plano, Texas.

In her most recent role for Crossmark, Ms.

Buckner served

as Vice President of Operations (Training & Development/Support Services/Client Operations).

During her service in that senior

Buckner led the company’s Learning Management System implementation for 30,000 field-based employees, as well

as several other key initiatives having direct P&L impact.

Buckner’s specific experience, qualifications, attributes

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

Over 10 years of experience directing teams and leading company-wide initiatives in the consumer goods and services industry

Success leading multi-million dollar domestic and international initiatives

Section 16(a) Beneficial Ownership Reporting Compliance

13 unchanged sentences

No Committees of the Board of Directors;

No Financial Expert

The Company does not presently have a separately

13 unchanged sentences

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:

The particulars of compensation paid to

the following persons during the fiscal period ended September 30, 2018 and 2017 are set out in the summary compensation table

our Chief Executive Officer (Principal Executive Officer);

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.

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, 2018 and 2017;

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, 2018 and 2017.

(collectively, the “

1 unchanged sentence

Officers ”):

SUMMARY COMPENSATION

SUMMARY COMPENSATION TABLE

Name and Principal Position

3 unchanged sentences

CFO, Principal Financial Officer

President and CSO

Principal Advisor

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 1.49% to 2.55% in 2018 and 0.85% to 1.41% in 2017, dividend yield of 0%, expected life of 2 years and volatility of

The aggregate grant date fair value of the option award is $232,596, to be recognized over the term of the option

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.

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

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 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.

(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 the Company to a consulting firm owned and controlled

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

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

Lyon, 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,

6 unchanged sentences

Outstanding Equity Awards at Fiscal Year-end

This section is not applicable to any Named

Executive Officer as of September 30, 2017.

Dan Sundby has options currently vesting

and the options will be fully vested in July 2019.

Compensation of Directors

4 unchanged sentences

or arrangements with officers or Directors.

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.

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, 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

The following table sets forth certain

information with respect to the beneficial ownership, as of September 30, 2018, 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 stock;

each director of the Company;

1 unchanged sentence

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

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

The address for each such beneficial owner is 800 N.

Watters Road, Suite 120, Allen, Texas 75013.

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

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

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

indicates an ownership percentage of less than one percent.

Beneficial Owner (1)

5 unchanged sentences

Paul Williams (2)

Reggio (2, 3)

Rick Johnson (2, 4)

Michael Ashby (2, 6)

Dan Sundby (2, 3)

Todd Bourgeois (2, 7)

George Crumley (2, 5)

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

David Myers (2, 5)

Debbie Buckner (2)

Directors and executive officers as group (nine persons)

Each beneficial owner has sole voting and investment power with respect to all shares attributable to that owner.

The address for each such beneficial owner is 800 N.

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

Includes 291,667 shares subject to options that are currently vested, plus an additional 208,333 shares subject to options that vest within 10 months not used.

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

indicates an ownership percentage of less than

Represents shares subject to options that are currently vested.

Includes 150,000 shares subject to options that are currently vested, and 25,000 shares subject to warrants that are currently vested, and 720,000 shares of common stock.

Includes 175,000 shares subject to options that are currently vested, and 150,000 shares of common stock.

indicates an ownership percentage of less than one percent.

Changes in Control

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.

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

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.

4 unchanged sentences

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

Equity compensation plans not approved by security holders

(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.

Equity compensation plans approved by security

holders (2015 Stock Option Plan)

Equity compensation plans not approved by

security holders (2016 Stock Option Plan)

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.

Shares subject to stock options under 2015 Stock Option Plan.

1 unchanged sentence

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

Shares available for grant of stock options to employees, directors and consultants under the 2016 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 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 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.

The Company is authorized to issue an aggregate of 20,000,000 options, of which 16,368,462 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

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.

Bison Financial Group, whose Chief Executive

Officer is Mr.

Paul Williams, has provided corporate financial advisory and business development services to the Company for a

flat fee of $3,000 per month.

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.

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

Gravity Holdings, a subsidiary of the Company, purchased all of the equity interests of Tax Coach Software, LLC, an Ohio limited

liability company, for aggregate consideration of 2,000,000 shares of the common stock of Financial Gravity (the “Tax Coach

Software Transaction”).

The Purchase Agreement for the Tax Coach Software Transaction was amended effective as of March 25,

2016 to give effect to a three-for-one (3:1) forward split of the Financial Gravity Holdings common stock, bringing the aggregate

consideration to 6,000,000 shares of the common stock of Financial Gravity Holdings.

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.

Effective as of October 1, 2015, Financial Gravity

Holdings, a subsidiary of the Company, purchased all of the equity interests of Tax Coach Software, LLC, an Ohio limited liability

company, for aggregate consideration of 2,000,000 shares of the common stock of Financial Gravity (the “Tax Coach Software

Transaction”).

The Purchase Agreement for the Tax Coach Software Transaction was amended effective as of March 25, 2016 to

give effect to a three-for-one (3:1) forward split of the Financial Gravity Holdings common stock, bringing the aggregate consideration

to 6,000,000 shares of the common stock of Financial Gravity Holdings.

TaxTuneup, LLC, which is an entity owned

2 unchanged sentences

As a consequence of such issuance,

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).

Lyon is the beneficial owner of 6.8% of the Company’s common stock as of September 30, 2018 (after giving effect to the

Additionally, Van Data, LLC, which is an

10 unchanged sentences

of Company common stock are completely separated.

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.

During fiscal 2018 and 2017, TaxTuneup,

LLC, an entity owned by Mr.

Lyon, received the sum of $198,000 and $198,000, respectively, from the Company, in compensation

for strategic tax planning recommendations and research, business consulting and writing of books and tax planning and Tax Master

related content.

During fiscal year 2018 and 2017, the Company

paid $138,980 and $198,000, 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.

During fiscal 2018 and 2017, a company

owned and controlled by Mr.

John Pollock (Fourly Enterprises, LLC) received the sum of $203,000 and $200,000, respectively, from

the Company, in compensation for strategic business planning and consulting, business development, process and technology development.

Director Independence;

7 unchanged sentences

The Company’s Board of Directors has determined

that, of the Company’s present directors, George Crumley, constituting one of the five members of the Board, is an “independent

director,”

as defined under NASDAQ’s Marketplace Rules, for purposes of qualifying as independent members of the Board

and an Audit, Compensation and Nominating Committee of the Board, but that John Pollock, Dave Crowley, Paul Williams and Edward

that, of the Company’s present directors, each of George Crumley, David Myers, Michael Ashby, and Todd Bourgeois, constituting

four of the eight members of the Board, is an “independent director,”

as defined under NASDAQ’s Marketplace Rules,

for purposes of qualifying as independent members of the Board and an Audit, Compensation and Nominating Committee of the Board,

but that John Pollock, Debbie Buckner, Paul Williams and Edward A.

Lyon are not “independent directors”

since they currently serve as executive officers of the Company.

currently serve as executive officers of the Company.

The Company’s Board of Directors

11 unchanged sentences

The following information summarizes the

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.

fees billed to us by Whitley Penn LLP for professional services rendered for the fiscal years ended September 30, 2018 and 2017,

respectively.

Fees billed for

services by Whitley Penn LLP were $103,238 for fiscal year 2018 and $126,687 for fiscal year 2017.

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.

2 unchanged sentences

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

5 unchanged sentences

EXHIBITS, FINANCIAL STATEMENT SCHEDULES

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.

(a) Financial

Statements and financial statement schedules

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.

required by Item 601 of Regulation S-K

(b) Exhibits required by Item

601 of Regulation S-K

Code of Ethics

9 unchanged sentences

Pursuant to the requirements of Section

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

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.

January 15, 2019

/s/ John Pollock

1 unchanged sentence

(Principal Executive Officer)

February 19, 2018

January 15, 2019

/s/ Paul Williams

7 unchanged sentences

Chairman, CEO

February 19, 2018

January 15, 2019

(principal executive officer)

1 unchanged sentence

Vice Chairman, CFO

February 19, 2018

January 15, 2019

Paul Williams

(principal financial officer)

/s/ Dan Sundby

February 19, 2018

/s/ George E.

January 15, 2019

/s/ Edward A.

February 19, 2018

/s/ George Crumley

February 19, 2018

George Crumley

January 15, 2019

/s/ David Myers

January 15, 2019

/s/ Michael Ashby

January 15, 2019

Michael Ashby

/s/ Todd Bourgeois

January 15, 2019

Todd Bourgeois

/s/ Debbie Buckner

Debbie Buckner

January 15, 2019

FINANCIAL GRAVITY COMPANIES, INC.

1 unchanged sentence

CONSOLIDATED FINANCIAL STATEMENTS AND

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING

SEPTEMBER 30, 2017 AND 2016

FINANCIAL GRAVITY COMPANIES, INC.

AND SUBSIDIARIES

REPORT OF INDEPENDENT REGISTERED PUBLIC

ACCOUNTING FIRM

SEPTEMBER 30, 2018 AND 2017

8 unchanged sentences

ACCOUNTING FIRM

Board of Directors and Stockholders of

To the Board of Directors and Stockholders

Financial Gravity Companies, Inc.

Opinion on the Financial Statements

We have audited the accompanying consolidated

balance sheets of Financial Gravity Companies, Inc.

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

consolidated statements of operations, changes in stockholders’

equity, and cash flows for the years then ended.

The Company’s

management is responsible for these consolidated financial statements.

Our responsibility is to express an opinion on these consolidated

financial statements based on our audits.

We conducted our audits in accordance with

the standards of the Public Company Accounting Oversight Board (United States).

Those standards require that we plan and perform

the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement.

The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting.

Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are

appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s

internal control over financial reporting.

Accordingly, we express no such opinion.

An audit also includes examining, on a test

basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and

significant estimates made by management, as well as evaluating the overall financial statement presentation.

We believe that our

audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial

statements referred to above present fairly, in all material respects, the financial position of the Company, as of September 30,

2017 and 2016, and the results of their operations and their cash flows for the years then ended, in conformity with accounting

principles generally accepted in the United States of America.

(the “Company”), as of September 30, 2018 and 2017, and the related consolidated statements of operations,

stockholders’

equity, and cash flows for the years then ended, and the related notes (collectively referred to as the “financial

statements”).

In our opinion, the consolidated financial statements present fairly, in all material respects, the financial

position of the Company as of December 31, 2018 and 2017, and the results of their operations and their cash flows for the years

then ended, in conformity with accounting principles generally accepted in the United States of America.

Emphasis of Matter

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

As discussed in Note 1 to the consolidated

financial statements, the Company has suffered recurring losses from operations and has a working 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

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

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

Basis for Opinion

These financial statements are the responsibility

of the Company’s management.

Our responsibility is to express an opinion on these financial statements based on our audits.

We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) ("PCAOB")

and are required to be independent with respect to the Company in accordance with the U.S.

federal securities laws and the applicable

rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with

the standards of the PCAOB.

Those standards require that we plan and perform the audit to obtain reasonable assurance about whether

the financial statements are free of material misstatement, whether due to error or fraud.

The Company is not required to have,

nor were we engaged to perform, an audit of its internal control over financial reporting.

As part of our audits we are required

to obtain an understanding of internal control over financial reporting, but not for the purpose of expressing an opinion on the

effectiveness of the entity’s internal control over financial reporting.

Accordingly, we express no such opinion.

Our audits included performing procedures

to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures

that respond to those risks.

Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures

in the financial statements.

Our audits also included evaluating the accounting principles used and significant estimates made

by management, as well as evaluating the overall presentation of the financial statements.

We believe that our audits provide a

reasonable basis for our opinion.

We have served as the Company's auditor

/s/ Whitley Penn LLP

Dallas, Texas

February 19, 2018

Financial Gravity

Companies, Inc.

and Subsidiaries

CONSOLIDATED BALANCE

January 15, 2019

Financial Gravity Companies, Inc.

CONSOLIDATED BALANCE SHEETS

As of September 30,

9 unchanged sentences

Non-compete agreements, net

Intellectual Property

LIABILITIES AND STOCKHOLDERS’

5 unchanged sentences

Notes payable

Pre-merger payables

Total current liabilities

10 unchanged sentences

of these consolidated financial statements.

Financial Gravity

Companies, Inc.

and Subsidiaries

CONSOLIDATED STATEMENTS

OF OPERATIONS

Financial Gravity Companies, Inc.

CONSOLIDATED STATEMENTS OF OPERATIONS

Years Ended September 30,

7 unchanged sentences

Depreciation and amortization

Impairment of goodwill

General and administrative

10 unchanged sentences

of these consolidated financial statements.

Financial Gravity

Companies, Inc.

and Subsidiaries

CONSOLIDATED STATEMENTS

OF CHANGES IN STOCKHOLDERS’

For the years

ended September 30, 2017 and 2016

Financial Gravity Companies, Inc.

CONSOLIDATED STATEMENTS OF CHANGES IN

STOCKHOLDERS’

For the years ended September 30, 2018

Number of Shares Issued and Outstanding

3 unchanged sentences

Common stock issued under a private placement memorandum

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

Common stock surrendered by former officer

Common stock held by Pacific Oil Company (reverse merger)

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

Common stock issued in exchange for services

Stock based compensation

1 unchanged sentence

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

3 unchanged sentences

of these consolidated financial statements.

Financial Gravity

Companies, Inc.

and Subsidiaries

CONSOLIDATED STATEMENTS

OF CASH FLOWS

Financial Gravity Companies, Inc.

CONSOLIDATED STATEMENTS OF CASH FLOWS

Years Ended September 30,

3 unchanged sentences

Depreciation and amortization

Impairment of goodwill

Forfeiture of deposit for failed acquisition

Common stock issued in exchange for services

Stock based compensation

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

Bad debt expense

Changes in operating assets and liabilities

Trade accounts receivable, net

2 unchanged sentences

Accounts payable - trade

Accounts payable - related party

Accrued expenses

5 unchanged sentences

Cash paid for purchase of property and equipment

Cash acquired upon acquisition of subsidiaries

Payments for purchase of investment

Purchases of trademarks

Net cash (used in) provided by investing activities

Net cash used in investing activities

CASH FLOWS FROM FINANCING ACTIVITIES

Borrowings from line of credit

Payments on line of credit

Borrowings from note payable

Payments on note payable

Payments on line of credit

Proceeds from the sale of common stock

Net cash provided by financing activities

TOTAL INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS

TOTAL CHANGE IN CASH AND CASH EQUIVALENTS

CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR

2 unchanged sentences

Cash paid during the year for:

Non-cash activities:

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

Net assets (liabilities) assumed for purchase of:

Tax Coach Software, LLC (Note 9)

Payables owed by Pacific Oil Company

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.

The accompanying notes are an integral part

of these consolidated financial statements.

Financial Gravity Companies, Inc.

and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NATURE OF BUSINESS

33 unchanged sentences

Financial Gravity Tax, Inc.

(“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.

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

Financial Gravity Wealth, Inc.

(“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.

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,

MDP is located in Tulsa, Oklahoma, and provides payroll services, software, and support solutions to business owners.

business was sold during fiscal 2018 for a net gain of $28,585.

Tax Coach Software, LLC (“TCS”),

6 unchanged sentences

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

The consolidated financial statements include

the accounts of FGH, FGO, Cloud9 (from the date of acquisition), including Cloud9B2B and Cloud9 Accelerator, LLC, PAG (from the

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”).

All significant intercompany accounts and transactions have been eliminated

on consolidation.

The consolidated financial statements

include the accounts of FGH, FGO, including Cloud9B2B and Cloud9 Accelerator, LLC, FGW (PAG), FGT (BLI), TMN (TCS) and MDP (through

June 2018), (collectively referred to as the “Company”).

All significant intercompany accounts and transactions have

been eliminated on consolidation.

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.

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.

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.

The 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.

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

2 unchanged sentences

The allowance for doubtful accounts was $21,876 and $17,014 as of September 30, 2018 and 2017, 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

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 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

3 unchanged sentences

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

Maintenance and repairs are charged to earnings

Maintenance and repairs are charged to

earnings as incurred;

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

5 unchanged sentences

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 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 .

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

7 unchanged sentences

of the TCS purchase has been recognized in the accompanying consolidated balance sheets at $525,100, the value attributed to it

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

The proprietary content is being amortized on a straight-line basis over an eight- year

estimated life.

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.

on the date of the purchase.

The proprietary content is being amortized on a straight-line basis over an eight- year estimated

During the years ended September 30, 2018 and 2017, 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, 2018 and 2017 was $196,912 and $131,276, 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.

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.

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, 2018 and 2017.

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).

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.

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

4 unchanged sentences

Accumulated amortization at September 30, 2018 and 2017 was $15,780 and $10,520, 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.

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, 2018 and 2017.

Goodwill represents the excess of the value

3 unchanged sentences

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.

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

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 it is 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 it carries 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, 2018, and 2017.

However, goodwill attributed to

Cloud9 and MDP was deemed to be impaired as of September 30, 2017 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

that reflects the relative risk of achieving the cash flow and the time value of money.

The fair value of relationships were determined

The fair value of relationships was determined

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

5 unchanged sentences

Goodwill at September 30, 2017

Goodwill generated from acquisition of TCS

Impairment of Cloud9

Impairment of MDP

Goodwill at September 30, 2018

Goodwill at September 30, 2017

The Company accounts for Federal and state

1 unchanged sentence

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”).

4 unchanged sentences

There was no accrued interest or penalties as of September 30, 2018 and 2017.

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 2015 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 period.

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

September 30, 2017 and 2016, 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

Average number of common shares were 35,830,228 and 35,361,321 for years ended September 30, 2018 and 2017, respectively.

For the years ended September 30, 2018

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.

and 2017, approximately 3,631,538 and 2,817,146 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 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.

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.

Members are not entitled to refunds for unused memberships.

1 unchanged sentence

when incurred.

Advertising and marketing expense was $375,499 and $402,402 for the years ended September 30, 2017 and 2016, respectively.

Advertising and marketing expense were $266,930 and $375,499 for the years ended September 30, 2018 and 2017, respectively.

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 0.85% 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%.

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 1.49% to 2.55% in 2018 and 0.85% to 1.41%

in 2017, dividend yield of 0%, expected life of 2 years and volatility of 36% to 137%.

Use of Estimates

5 unchanged sentences

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.

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 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”).

The Agreement was

filed as an exhibit to a registration statement on Form S-1, filed with the Securities and Exchange Commission on September 18,

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”

shares 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

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 parties.

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

12 unchanged sentences

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

In March 2016, the FASB issued ASU Update No.

In March 2017, the FASB issued ASU Update

2017-07, Investments –

8 unchanged sentences

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.

In March 2017, the FASB issued ASU Update

2017-08, Revenue from Contracts with Customers (Topic 606).

17 unchanged sentences

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

In March 2016, the FASB issued ASU Update No.

In March 2017, the FASB issued ASU Update

2017-09, 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.

12 unchanged sentences

during the years ended September 30, 2018 and 2017, respectively.

Trademarks consist of the following:

Intellectual property consists of the

Trademarks at September 30, 2016

3 unchanged sentences

Trademarks at September 30, 2018

LINE OF CREDIT

The Company has a revolving line of credit

8 unchanged sentences

2018 and 2017, respectively.

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

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

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 facility matured 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.

The balance outstanding under this note payable

was $0 and $92,197 at September 30, 2018 and 2017, respectively.

The Company entered into a Business Loan and Security Agreement

6 unchanged sentences

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.

The interest rate on the

The note matured on August 16, 2018.

Fourly is owned by the majority stockholder of the Company.

The outstanding

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

The outstanding balance

was $0 and $46,461 at September 30, 2018 and 2017, respectively.

On August 9, 2017 the Company entered into

1 unchanged sentence

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.

First year payment is

equal to 10% of the loan value.

A second year payment equal to 10% of the loan value was issued on January 1, 2019 with monthly

principal and interest of $4,614 starting on year three.

The note matures July 15, 2021.

The outstanding balance was $100,000 at

September 30, 2018 and 2017, respectively.

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.

year payment is equal to 10% of the loan value with monthly principal and interest of $4,614 starting on year two.

The note matures

August 15, 2020.

The outstanding balance was $92,406 and $100,000 at September 30, 2018 and 2017, respectively.

On September 5, 2017 the Company entered

1 unchanged sentence

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:

The interest rate on the note is

First year payment is equal to 10% of the loan value with monthly principal and interest of $4,614 starting on year two.

remaining principal and accrued interest of this note is due on the maturity date, August 15, 2020.

The outstanding balance was

$100,000 at September 30, 2018 and 2017, respectively.

On October 2, 2017 the Company entered

into a Promissory Note Payable with Indar and Sybil Bally in the amount of $100,000.

The interest rate on the note is 10%.

year payment is equal to 10% of the loan value with monthly principal and interest of $4,614 starting on year two.

The remaining

principal and accrued interest of this note is due on the maturity date, October 2, 2020.

The outstanding balance was $100,000

and $0 at September 30, 2018 and 2017, respectively.

On October 2, 2017 the Company entered

into a Promissory Note Payable with Paul Frueh in the amount of $100,000.

The interest rate on the note is 10%.

First year payment

is equal to 10% of the loan value with monthly principal and interest of $4,614 starting on year two.

The remaining principal and

accrued interest of this note is due on the maturity date, October 20, 2020.

The outstanding balance was $100,000 and $0 at September

30, 2018 and 2017, respectively.

On November 2, 2017 the Company entered

into a Promissory Note Payable with Michael and Donna Dade in the amount of $340,000.

The interest rate on the note is 10%.

year payment is equal to 10% of the loan value with monthly principal and interest of $15,689 starting on year two.

The remaining

principal and accrued interest of this note is due on the maturity date, October 20, 2020.

The outstanding balance was $340,000

and $0 at September 30, 2018 and 2017, respectively.

On March 15, 2018 the Company entered into

a Promissory Note Payable with Helen Janssen in the amount of $200,000.

The interest rate on the note is 10%.

First year payment

is equal to 10% of the loan value with monthly principal and interest of $9,229 starting on year two.

The remaining principal and

accrued interest of this note is due on the maturity date, February 15, 2021.

The outstanding balance was $200,000 and $0 at September

30, 2018 and 2017, respectively.

The Company’s maturities of debt

subsequent to September 30, 2018 are as follows:

Accrued expenses consist of the following

at September 30:

Accrued payroll

3 unchanged sentences

upon inception in 2014.

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.

Net operating losses (“NOL”) since that date total $3,233,265 as of September 30, 2018 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.

4 unchanged sentences

Expense not deductible

Impairment of goodwill

State tax, net of federal benefit

Effect of rate change

Changes to valuation allowance

11 unchanged sentences

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:

5 unchanged sentences

Net deferred taxes

The Tax Cuts and Jobs Act (the “Tax Act”), which

was enacted December 22, 2017, reduced the corporate income tax rate effective January 1, 2018 from 35% to 21%.

Among the other

significant tax law changes that potentially affect the Company are the limitations on the deduction for interest incurred in

2018 or later of up to 70% of its taxable income for the carryforward year and the limitation of the utilization of post 2017

net operating loss carryforwards.

At September 30, 2018, the Company has not completed its accounting for the tax effects of enactment

of the Tax Act, however, it has made reasonable estimates of the effects on its existing deferred tax balances.

The Company does

not anticipate material changes to its income tax provision as a result of the passage of the Tax Act until pretax law change

net operating losses are fully utilized or expire in 2026.

The Company has remeasured certain deferred federal tax assets and

liabilities based on the rates at which they are expected to reverse in the future, which is generally 21%.

The deferred tax assets

of the Company were reduced by $408,041 as a result of this remeasurement.

This change was fully offset by the corresponding change

in the valuation allowance.

The Company is still analyzing certain aspects of the Tax Act, and refining its calculations, which

could potentially affect the measurement of those balances or potentially give rise to new deferred tax amounts.

The Company’s

estimates may also be affected in the future as the Company gains a more thorough understanding of the Tax Act, and how the individual

states are implementing this new law.

COMMITMENTS, CONTINGENCIES AND CONCENTRATIONS

The Company conducts operations from leased

premises leased through 2024.

Some of these leases provide for payment of taxes, insurance, utilities and maintenance.

The Company also leases certain

equipment under operating leases.

Total rent expense for the years ended September 30, 2017 and 2016 was $102,960 and $89,150, respectively.

also leases certain equipment under operating leases.

Total rent expense for the years ended September 30, 2018 and 2017 was $125,297

and $118,126, respectively.

Rent expense is recorded on a straight-line basis over the term of the lease.

The difference between rental expense and rental

payments is recorded as deferred rent within accrued expenses in the accompanying consolidated balance sheets.

Management expects

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

The difference between

rental expense and rental payments is recorded as deferred rent within accrued expenses in the accompanying consolidated balance

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

Minimum future annual rental payments under

1 unchanged sentence

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.

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

Under the terms of the TCS purchase agreement,

the common stock issued had 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.

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.

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.

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 –

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.

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

Two employee agreements include a base salary of $42,000 per year, per employee.

These same two agreements, include a bonus

that is calculated, for each employee, as the sum of 40% of the gross profit of Tax Coach Software for all revenues that exceed

$850,000 and are less than $950,000 and 20% of the gross profit of Tax Coach Software for all revenues earned in excess of $950,000.

One employee agreement includes a base salary of $60,000 per year.

This same agreement, includes a bonus that is calculated as

the sum of 20% of the gross profit of Tax Coach Software for all revenues that exceed $850,000 and are less than $950,000 and

10% of the gross profit of Tax Coach Software for all revenues earned in excess of $950,000.

Gross profit is determined in accordance

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

The agreements

also include other certain termination and non-compete clauses.

Compensation during the month of October 2015 to be paid to the

three employees totals an aggregate amount of $49,150.

Three consulting agreements were made as a condition to the acquisition.

Two agreements require certain services at a fixed fee of $17,000 per month, per agreement, commencing on November 1, 2015 with

a 90-day termination clause.

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,

Ohio, provides three primary services including monthly subscription revenue from the “Tax Coach”

software system,

coaching revenue and email marketing services for customers.

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)

Additional paid in capital for the escrow agreement provision

Total value of the goodwill generated on acquisition

Intangible assets acquired

Net tangible assets acquired

Total assets acquired

Total fair value of acquisition

The intangible assets were as follows:

Customer relationships

Proprietary content

Prospect list

Non-compete agreements

Total intangible assets

The tangible assets acquired and liabilities assumed were as follows:

Assets acquired:

Accounts receivable

Accounts receivable - other

Internally developed software

Total tangible assets

Liabilities assumed:

Accrued expenses

Line of credit

Total liabilities

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

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.

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.

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.

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.

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

Gravity Holdings.

2 unchanged sentences

Holdings, its subsidiary, there were no preferred shares issued or outstanding as of September 30, 2018 and 2017.

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

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 l-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,

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.

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.

In the quarter ended December 31, 2017,

an aggregate of 100,000 shares of the Company’s common stock had been sold for $100,000 for which the Company issued warrants

for the purchase of 25,000 shares of common stock of the Company at an exercise price of $1.25 per share for a 1 year term and

an additional 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

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.

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,

On October 31, 2014, Financial Gravity

15 unchanged sentences

and 2017, 100,000 shares and 725,000 shares, respectively, were issued for $100,000 and $725,000, 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

1 unchanged sentence

Holdings declared a three for one stock split of its common stock.

Upon the stock split, every one share of common stock issued

Upon the stock split, everyone shares of common stock issued

and outstanding was automatically reclassified and converted into three shares of common stock.

2 unchanged sentences

STOCK OPTION 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

to grant stock options.

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 to grant stock options.

The maximum number of shares of stock that may be issued and exercised under the Plan is 9,000,000.

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

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

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

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 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.

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

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.

The first date any

options were granted under the 2017 Plan was December 19, 2016.

Stock option activity is summarized as follows:

11 unchanged sentences

Exercisable - end of year

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.

All outstanding 2015 Plan stock options

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

stock options granted under the 2016 Plan have 2-year vesting periods but there were 20,000 and 450,000 options that vested at

issuance during fiscal 2017 and 2018, respectively.

Total compensation expense included in salaries and wages of previously unamortized

stock compensation was $206,484 and $50,773 for the years ended September 30, 2018 and 2017, respectively.

Unamortized share-based

compensation expense as of September 30, 2018 amounted to $162,287 which is expected to recognize over the next 1.5 years.

RELATED PARTY TRANSACTIONS

2 unchanged sentences

related party in the accompanying consolidated balance sheets

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

was $1,791 and $4,506 as of September 30, 2018 and 2017, respectively.

Management fees paid to the majority stockholder

of the entity, included as management fees - related party in the accompanying consolidated statements of operations were $203,000

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

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%.

and $200,000 for fiscal 2018 and 2017, 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

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.

Fourly is owned by the majority stockholder of the Company.

The outstanding balance

was $0 and $46,461 at September 30, 2018 and 2017, respectively.

Three employment agreements were made as

a condition of the TCS acquisition during fiscal 2016.

Each agreement has an effective date as of November 1, 2015 and is effective

for a period of three years.

Two employee agreements include a base salary of $42,000 per year, per employee.

These same two agreements

include a bonus that is calculated, for each employee, as the sum of 40% of the gross profit of Tax Coach Software for all revenues

that exceed $850,000 and are less than $950,000 and 20% of the gross profit of Tax Coach Software for all revenues earned in excess

One employee agreement includes a base salary of $60,000 per year.

This same agreement includes a bonus that is calculated

as the sum of 20% of the gross profit of Tax Coach Software for all revenues that exceed $850,000 and are less than $950,000 and

10% of the gross profit of Tax Coach Software for all revenues earned in excess of $950,000.

Gross profit is determined in accordance

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

The agreements

also include other certain termination and non-compete clauses.

Compensation during the month of October 2015 to be paid to the

three employees totals an aggregate amount of $49,150.

Three consulting agreements were made as a condition to the acquisition.

Two agreements require certain services at a fixed fee of $17,000 per month, per agreement, commencing on November 1, 2015 with

a 90-day termination clause.

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.

$403,160 and $444,600 in professional

fees were paid under these 3 agreements during the years ended September 30, 2018 and 2017, respectively, and are included in selling,

general and administrative expenses in the accompanying statement of operations.

SUBSEQUENT EVENTS

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.

Subsequent to September 30, 2018, an aggregate of 150,000 options

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

Financial Gravity entered into a new lease agreement with HPC

Services, LLC.

Starting November 1, 2018.

Financial Gravity will be expanding its new headquarters office space in the same building

and moving to a new suite.

The new corporate headquarters address will be at 800 N.

Suite 150, Allen, TX 75013 where

the company will have 5,214 square feet of office space under the new lease.

Financial Gravity is required to make monthly payments

of $7,712 per month (including operating expense) for the next 2 years.

The rent will increase February 2022 to $8,146 per month

(including operating expense) until the lease expires in January 2024.

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