What changed in this filing

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Item 1A. Risk Factors

2022-04-15 compared with 2021-04-15 · 218 added, 104 removed, 17 unchanged (95% of the section changed)

Risks Relating to Business and Financial Condition

Our business, operating results or financial condition could be materially adversely affected by any of the following risks.

Our business, operating results or financial condition could

be materially adversely affected by any of the following risks.

Risk Factors Related to the Business of the Company

Because our auditor has issued a going concern opinion regarding our company, there is an increased risk associated with an investment in our company.

We have limited cash as of December 31, 2020 of $753,316, and we have continually operated at a loss with an accumulated deficit of $14,699,148 as of December 31, 2020.

We have not attained profitable operations and are dependent upon obtaining financing or generating revenue from operations to continue operations for the next twelve months.

Because our auditor has issued a going concern opinion regarding

our company, there is a risk associated with an investment in our company.

We have continually operated at a loss with an accumulated deficit of $18,536,922

as of December 31, 2021.

We have not attained profitable operations and even though the company maintains a cash position very close to

one year's operating expenses, we dependent upon obtaining financing or generating revenue from operations to continue operations for

the next twelve months.

Our future is dependent upon our ability to obtain financing or upon future profitable operations.

We reserve the right to seek additional funds through private placements of our common stock and/or through debt financing.

Our ability to raise additional financing is unknown.

the right to seek additional funds through private placements of our common stock and/or through debt financing.

Our ability to raise

additional financing is unknown.

We do not have any formal commitments or arrangements for the advancement or loan of funds.

The Company has been qualified for a public offering of 80,000,000 shares of our common stock under the Regulation A.

This offering is being conducted on a “best efforts” basis, which means that there is no guarantee that any minimum amount will be sold.

For these reasons, our auditors stated in their report that they have substantial doubt we will be able to continue as a going concern.

As a result, there is an increased risk that you could lose the entire amount of your investment in our company.

Our telecommunications line of business is highly sensitive to declining prices, which may adversely affect our revenues and margins.

The telecommunications industry is characterized by intense price competition, which has resulted in declines in both our average per-minute price realizations and our average per-minute termination costs.

A reduction of our prices to compete with any other offers in the market will not always guarantee an increase in the traffic, which may result in a reduction of revenue.

If these trends in pricing continue or accelerate, it could have a material adverse effect on the revenues generated by our telecommunications businesses and/or our gross margins.

The continued growth of Over-The-Top calling and messaging services, such as WhatsApp, Skype and Viber has adversely affected the use of traditional phone communications.

We expect this IP-based services which offer voice communications for free to continue to increase, which may result in increased substitution on our service offerings.

The termination of our carrier agreements or our inability to enter into new carrier agreements in the future could materially and adversely affect our ability to compete, which could reduce our revenues and profits.

We rely upon our carrier agreements in order to provide our telecommunications services to our customers.

These carrier agreements are in most cases for finite terms and, therefore, there can be no guarantee that these agreements will be renewed at all or on favorable terms to us.

Our ability to compete would be adversely affected if our carrier agreements were terminated or we were unable to enter into carrier agreements in the future to provide our telecommunications services to our customers, which could result in a reduction of our revenues and profits.

Our customers could experience financial difficulties, which could adversely affect our revenues and profitability if we experience difficulties in collecting our receivables.

As a provider of international long-distance services, we depend upon sales of transmission and termination of traffic to other long distance providers and the collection of receivables from these customers.

The wholesale telecommunications market continues to feature many smaller, less financially stable companies.

If weakness in the telecommunications industry or the global economy reduces our ability to collect our accounts receivable from our major customers our profitability may be substantially reduced.

While our most significant customers, from a revenue perspective, vary from quarter to quarter, our fourteen largest customers (5% of our total customer base) collectively accounted for 80% of total consolidated revenues in fiscal year 2020.

This concentration of revenues increases our exposure to non-payment by our larger customers, and we may experience significant write-offs if any of our large customers fail to pay their outstanding balances, which could adversely affect our revenues and profitability.

Natural disasters, terrorist acts, acts of war, pandemics, cyber-attacks or other breaches of network or information technology security may cause equipment failures or disrupt our operations.

Our inability to operate our telecommunications networks because of the events listed above, even for a limited period of time, may result in loss of revenue, significant expenses, which could have a material adverse effect on our results of operations and financial condition.

We could be harmed by network disruptions, security breaches, or other significant disruptions or failures of our IT infrastructure and related systems.

To be successful, we need to continue to have available a high capacity, reliable and secure network for our and our customers’ use.

As any other company, we face the risk of a security breach, whether through cyber-attacks, malware, computer viruses, sabotage, or other significant disruption of our IT infrastructure and related systems.

There is a risk of a security breach or disruption of the systems we operate, including possible unauthorized access to our proprietary or classified information.

We are also subject to breaches of our network resulting in unauthorized utilization of our services, which subject us to the costs of providing those services, which are likely not recoverable.

The secure maintenance and transmission of our information is a critical element of our operations.

Our information technology and other systems that maintain and transmit customer information may be compromised by a malicious third-party penetration of our network security, or impacted by advertent or inadvertent actions or inactions by our employees, or those of a third party service provider or business partner.

As a result, our or our customers’ information may be lost, disclosed, accessed or taken without the customers’ consent, or our services may be used without payment.

Although we make significant efforts to maintain the security and integrity of these types of information and systems, there can be no assurance that our security efforts and measures will be effective or that attempted security breaches or disruptions would not be successful or damaging, especially in light of the growing sophistication of cyber-attacks and intrusions.

We may be unable to anticipate all potential types of attacks or intrusions or to implement adequate security barriers or other preventative measures.

has been qualified for a public offering of 80,000,000 shares of our common stock under the Regulation A.

This offering is being conducted

on a “best efforts” basis, which means that there is no guarantee that any minimum amount will be sold.

For these reasons,

our auditors stated in their report that they have substantial doubt we will be able to continue as a going concern.

As a result, there

is a risk that you could lose the entire amount of your investment in our company.

Our telecommunications line of business is highly sensitive to declining

prices, which may adversely affect our revenues and margins.

The telecommunications industry is characterized by intense price competition,

which has resulted in declines in both our average per-minute price realizations and our average per-minute termination costs.

A reduction of our prices to compete with any other offers in the market

will not always guarantee an increase in the traffic, which may result in a reduction of revenue.

If these trends in pricing continue

or accelerate, it could have a material adverse effect on the revenues generated by our telecommunications businesses and/or our gross

The continued growth of Over-The-Top calling and messaging services, such as WhatsApp, Skype and Viber has adversely affected

the use of traditional phone communications.

We expect this IP-based services which offer voice communications for free to continue to

increase, which may result in increased substitution on our service offerings.

The termination of our carrier agreements or our inability to enter

into new carrier agreements in the future could materially and adversely affect our ability to compete, which could reduce our revenues

We rely upon our carrier agreements in order to provide our telecommunications

services to our customers.

These carrier agreements are in most cases for finite terms and, therefore, there can be no guarantee that

these agreements will be renewed at all or on favorable terms to us.

Our ability to compete would be adversely affected if our carrier

agreements were terminated or we were unable to enter into carrier agreements in the future to provide our telecommunications services

to our customers, which could result in a reduction of our revenues and profits.

Our customers could experience financial difficulties, which could

adversely affect our revenues and profitability if we experience difficulties in collecting our receivables.

As a provider of international long-distance services, we depend upon sales

of transmission and termination of traffic to other long-distance providers and the collection of receivables from these customers.

wholesale telecommunications market continues to feature many smaller, less financially stable companies.

If weakness in the telecommunications

industry or the global economy reduces our ability to collect our accounts receivable from our major customers our profitability may be

substantially reduced.

While our most significant customers, from a revenue perspective, vary from quarter to quarter, our seven largest

customers (2.5% of our total customer base) collectively accounted for 88% of total consolidated revenues in fiscal year 2021.

this concentration of revenues does not increase our exposure to non-payment by our larger customers, since 68% of our revenue is prepaid.

Natural disasters, terrorist acts, acts of war, pandemics, cyber-attacks

or other breaches of network or information technology security may cause equipment failures or disrupt our operations.

Our inability to operate our telecommunications networks because of the

events listed above, even for a limited period, may result in loss of revenue, significant expenses, which could have a material adverse

effect on our results of operations and financial condition.

We could be harmed by network disruptions, security breaches, or other

significant disruptions or failures of our IT infrastructure and related systems.

To be successful, we need to continue to have available

a high capacity, reliable and secure network for our and our customers’ use.

As any other company, we face the risk of a security

breach, whether through cyber-attacks, malware, computer viruses, sabotage, or other significant disruption of our IT infrastructure and

related systems.

There is a risk of a security breach or disruption of the systems we operate, including possible unauthorized access

to our proprietary or classified information.

We are also subject to breaches of our network resulting in unauthorized utilization of

our services, which subject us to the costs of providing those services, which are likely not recoverable.

The secure maintenance and

transmission of our information is a critical element of our operations.

Our information technology and other systems that maintain and

transmit customer information may be compromised by a malicious third-party penetration of our network security, or impacted by advertent

or inadvertent actions or inactions by our employees, or those of a third-party service provider or business partner.

As a result, our

or our customers’ information may be lost, disclosed, accessed or taken without the customers’ consent, or our services may

be used without payment.

Although we make significant efforts to maintain the security and integrity

of these types of information and systems, there can be no assurance that our security efforts and measures will be effective or that

attempted security breaches or disruptions would not be successful or damaging, especially in light of the growing sophistication of cyber-attacks

and intrusions.

We may be unable to anticipate all potential types of attacks or intrusions or to implement adequate security barriers

or other preventative measures.

Certain of our business units have been the subject of attempted and successful cyber-attacks in the past.

We have researched the situations and do not believe any material internal or customer information has been compromised.

We operate a global business that exposes us to currency, economic and regulatory.

We operate a global business that exposes us to currency, economic

and regulatory.

Our revenue comes primarily from sales outside the U.S.

and our growth strategy is largely focused on emerging markets.

Our success delivering solutions and competing in international markets is subject to our ability to manage various risks and difficulties, including, but not limited to:

· our ability to effectively staff, provide technical support and manage operations in multiple countries;

· fluctuations in currency exchange rates;

· timely collecting of accounts receivable from customers located outside of the U.S.;

· trade restrictions, political instability, disruptions in financial markets, and deterioration of economic conditions;

· compliance with the U.S.

and our growth

strategy is largely focused on emerging markets.

Our success delivering solutions and competing in international markets is subject to

our ability to manage various risks and difficulties, including, but not limited to:

· our ability to effectively

staff, provide technical support and manage operations in multiple countries;

· fluctuations in

currency exchange rates;

· timely collecting

of accounts receivable from customers located outside of the U.S.;

· trade restrictions,

political instability, disruptions in financial markets, and deterioration of economic conditions;

· compliance with

Foreign Corrupt Practices Act, and other anti-bribery laws and regulations;

· variations and changes in laws applicable to our operations in different jurisdictions, including enforceability of intellectual property and contract rights;

· compliance with export regulations, tariffs and other regulatory barriers.

We are subject to tax and regulatory audits which could result in the imposition of liabilities that may or may not have been reserved.

We are subject to audits by taxing and regulatory authorities with respect to certain of our income and operations.

These audits can cover periods for several years prior to the date the audit is undertaken and could result in the imposition of liabilities, interest and penalties if our positions are not accepted by the auditing entity.

We may be unable to achieve some, all or any of the benefits that we expect to achieve from our plan to expand our operations.

In the future we may require additional financing for capital requirements and growth initiatives.

Accordingly, we will depend on our ability to generate cash flows from operations and to borrow funds and issue securities in the capital markets to maintain and expand our business.

We may need to incur debt on terms and at interest rates that may not be as favorable.

If additional financing is not available when required or is not available on acceptable terms, we may be unable to operate our business as planned or at all, fund our expansion, successfully promote our business, develop or enhance our products and services, take advantage of business opportunities or respond to competitive pressures, any of which could have a material adverse effect on our business, financial condition and results of operations

· variations and changes

in laws applicable to our operations in different jurisdictions, including enforceability of intellectual property and contract rights;

· compliance with

export regulations, tariffs and other regulatory barriers.

We are subject to tax and regulatory audits which could result in the imposition

of liabilities that may or may not have been reserved.

We are subject to audits by taxing and regulatory authorities with respect to certain

of our income and operations.

These audits can cover periods for several years prior to the date the audit is undertaken and could result

in the imposition of liabilities, interest and penalties if our positions are not accepted by the auditing entity.

We may be unable to achieve some, all or any of the benefits that

we expect to achieve from our plan to expand our operations.

In the future we may require additional financing for capital requirements

and growth initiatives.

Accordingly, we will depend on our ability to generate cash flows from operations and to borrow funds and issue

securities in the capital markets to maintain and expand our business.

We may need to incur debt on terms and at interest rates that may

not be as favorable.

If additional financing is not available when required or is not available on acceptable terms, we may be unable

to operate our business as planned or at all, fund our expansion, successfully promote our business, develop or enhance our products and

services, take advantage of business opportunities or respond to competitive pressures, any of which could have a material adverse effect

on our business, financial condition and results of operations

Risks Relating to Our Securities

If a market for our common stock does not develop, shareholders may be unable to sell their shares.

Our common stock is quoted under the symbol “IQST” on the OTCPink operated by OTC Markets Group, Inc., an electronic inter-dealer quotation medium for equity securities.

We do not currently have an active trading market.

There can be no assurance that an active and liquid trading market will develop or, if developed, that it will be sustained.

Our securities are very thinly traded.

Accordingly, it may be difficult to sell shares of our common stock without significantly depressing the value of the stock.

Unless we are successful in developing continued investor interest in our stock, sales of our stock could continue to result in major fluctuations in the price of the stock.

The market price of our common stock is likely to be highly volatile and could fluctuate widely in price in response to various factors, many of which are beyond our control.

If a market for our common stock does not develop, stockholders may

be unable to sell their shares.

Our common stock is quoted under the symbol “IQST” on the OTCQX

operated by OTC Markets Group, Inc., an electronic inter-dealer quotation medium for equity securities.

Even though we currently have

an active trading market, there can be no assurance that it will be sustained.

The market price of our common stock is likely to be highly volatile

and could fluctuate widely in price in response to various factors, many of which are beyond our control.

Our stock price is subject to a number of factors, including:

· Technological innovations or new products and services by us or our competitors;

· Government regulation of our products and services;

· The establishment of partnerships with other telecom companies;

· Intellectual property disputes;

· Additions or departures of key personnel;

· Sales of our common stock;

· Our ability to integrate operations, technology, products and services;

· Our ability to execute our business plan;

· Operating results below or exceeding expectations;

· Whether we achieve profits or not;

· Loss or addition of any strategic relationship;

· Technological innovations

or new products and services by us or our competitors;

· Government regulation

of our products and services;

· The establishment

of partnerships with other telecom companies;

· Intellectual property

· Additions or departures

of key personnel;

· Sales of our common

· Our ability to integrate

operations, technology, products and services;

· Our ability to execute

our business plan;

· Operating results

below or exceeding expectations;

· Whether we achieve

profits or not;

· Loss or addition

of any strategic relationship;

· Industry developments;

· Economic and other external factors;

· Period-to-period fluctuations in our financial results.

· Economic and other

external factors;

· Period-to-period

fluctuations in our financial results.

Our stock price may fluctuate widely as a result of any of the above.

In addition, the securities markets have from time to time experienced significant price and volume fluctuations that are unrelated to the operating performance of particular companies.

These market fluctuations may also materially and adversely affect the market price of our common stock.

Because we are subject to the “Penny Stock” rules, the level of trading activity in our stock may be reduced.

The Securities and Exchange Commission has adopted regulations which generally define "penny stock"

to be any listed, trading equity security that has a market price less than $5.00 per share or an exercise price of less than $5.00 per share, subject to certain exemptions.

The penny stock rules require a broker-dealer, prior to a transaction in a penny stock not otherwise exempt from the rules, to deliver a standardized risk disclosure document that provides information about penny stocks and the risks in the penny stock market.

The broker-dealer must also provide the customer with current bid and offer quotations for the penny stock, the compensation of the broker-dealer and its salesperson in the transaction, and monthly account statements showing the market value of each penny stock held in the customer’s account.

In addition, the penny stock rules generally require that prior to a transaction in a penny stock, the broker-dealer make a special written determination that the penny stock is a suitable investment for the purchaser and receive the purchaser’s written agreement to the transaction.

These disclosure requirements may have the effect of reducing the level of trading activity in the secondary market for a stock that becomes subject to the penny stock rules which may increase the difficulty Purchasers may experience in attempting to liquidate such securities.

addition, the securities markets have from time to time experienced significant price and volume fluctuations that are unrelated to the

operating performance of particular companies.

These market fluctuations may also materially and adversely affect the market price of

our common stock.

Because we are subject to the “Penny Stock” rules, the

level of trading activity in our stock may be reduced.

The Securities and Exchange Commission has adopted regulations which generally

define "penny stock" to be any listed, trading equity security that has a market price less than $5.00 per share or an exercise

price of less than $5.00 per share, subject to certain exemptions.

The penny stock rules require a broker-dealer, prior to a transaction

in a penny stock not otherwise exempt from the rules, to deliver a standardized risk disclosure document that provides information about

penny stocks and the risks in the penny stock market.

The broker-dealer must also provide the customer with current bid and offer quotations

for the penny stock, the compensation of the broker-dealer and its salesperson in the transaction, and monthly account statements showing

the market value of each penny stock held in the customer’s account.

In addition, the penny stock rules generally require that prior

to a transaction in a penny stock, the broker-dealer make a special written determination that the penny stock is a suitable investment

for the purchaser and receive the purchaser’s written agreement to the transaction.

These disclosure requirements may have the effect

of reducing the level of trading activity in the secondary market for a stock that becomes subject to the penny stock rules which may

increase the difficulty Purchasers may experience in attempting to liquidate such securities.

We do not expect to pay dividends in the foreseeable future.

Any return on investment may be limited to the value of our common stock.

We do not anticipate paying cash dividends on our common stock in the foreseeable future.

The payment of dividends on our common stock will depend on earnings, financial condition and other business and economic factors affecting it at such time as the board of directors may consider relevant.

If we do not pay dividends, our common stock may be less valuable because a return on your investment will occur only if our stock price appreciates.

Provisions in the Nevada Revised Statutes and our Bylaws could make it very difficult for an investor to bring any legal actions against our directors or officers for violations of their fiduciary duties or could require us to pay any amounts incurred by our directors or officers in any such actions.

Members of our board of directors and our officers will have no liability for breaches of their fiduciary duty of care as a director or officer, except in limited circumstances, pursuant to provisions in the Nevada Revised Statutes and our Bylaws as authorized by the Nevada Revised Statutes.

Specifically, Section 78.138 of the Nevada Revised Statutes provides that a director or officer is not individually liable to the company or its shareholders or creditors for any damages as a result of any act or failure to act in his or her capacity as a director or officer unless it is proven that (1) the director’s or officer’s act or failure to act constituted a breach of his or her fiduciary duties as a director or officer and (2) his or her breach of those duties involved intentional misconduct, fraud or a knowing violation of law.

This provision is intended to afford directors and officers protection against and to limit their potential liability for monetary damages resulting from suits alleging a breach of the duty of care by a director or officer.

Accordingly, you may be unable to prevail in a legal action against our directors or officers even if they have breached their fiduciary duty of care.

In addition, our Bylaws allow us to indemnify our directors and officers from and against any and all costs, charges and expenses resulting from their acting in such capacities with us.

This means that if you were able to enforce an action against our directors or officers, in all likelihood, we would be required to pay any expenses they incurred in defending the lawsuit and any judgment or settlement they otherwise would be required to pay.

Accordingly, our indemnification obligations could divert needed financial resources and may adversely affect our business, financial condition, results of operations and cash flows, and adversely affect prevailing market prices for our common stock.

The extent to which the coronavirus ("COVID-19") outbreak impacts our business, results of operations and financial condition will depend on future developments, which cannot be predicted.

The COVID-19 pandemic has caused us to modify our business practices (including employee travel, employee work locations, and cancellation of physical participation in meetings, events and conferences), and we may take further actions as may be required by government authorities or that we determine are in the best interests of our employees, customers and business partners.

There is no certainty that such measures will be sufficient to mitigate the risks posed by the virus or otherwise be satisfactory to government authorities.

The extent to which COVID-19 impacts our business, results of operations and financial condition will depend on future developments, which are uncertain and cannot be predicted, including, but not limited to, the duration and spread of the outbreak, its severity, the actions to contain the virus or treat its impact, and how quickly and to what extent normal economic and operating conditions can resume.

Even after the coronavirus outbreak has subsided, we may continue to experience materially adverse impacts to our business as a result of its global economic impact, including any recession that has occurred or may occur in the future.

The disclosures concerning our properties are contained in Item 1 Business above and incorporated herein by reference.

return on investment may be limited to the value of our common stock.

We do not anticipate paying cash dividends on our common stock in the foreseeable

The payment of dividends on our common stock will depend on earnings, financial condition and other business and economic factors

affecting it at such time as the board of directors may consider relevant.

If we do not pay dividends, our common stock may be less valuable

because a return on your investment will occur only if our stock price appreciates.

Provisions in the Nevada Revised Statutes and our Bylaws could make

it very difficult for an investor to bring any legal actions against our directors or officers for violations of their fiduciary duties

or could require us to pay any amounts incurred by our directors or officers in any such actions.

Members of our board of directors and our officers will have no liability

for breaches of their fiduciary duty of care as a director or officer, except in limited circumstances, pursuant to provisions in the

Nevada Revised Statutes and our Bylaws as authorized by the Nevada Revised Statutes.

Specifically, Section 78.138 of the Nevada Revised

Statutes provides that a director or officer is not individually liable to the company or its stockholders or creditors for any damages

as a result of any act or failure to act in his or her capacity as a director or officer unless it is proven that (1) the director’s

or officer’s act or failure to act constituted a breach of his or her fiduciary duties as a director or officer and (2) his or her

breach of those duties involved intentional misconduct, fraud or a knowing violation of law.

This provision is intended to afford directors

and officers protection against and to limit their potential liability for monetary damages resulting from suits alleging a breach of

the duty of care by a director or officer.

Accordingly, you may be unable to prevail in a legal action against our directors or officers

even if they have breached their fiduciary duty of care.

In addition, our Bylaws allow us to indemnify our directors and officers from

and against any and all costs, charges and expenses resulting from their acting in such capacities with us.

This means that if you were

able to enforce an action against our directors or officers, in all likelihood, we would be required to pay any expenses they incurred

in defending the lawsuit and any judgment or settlement they otherwise would be required to pay.

Accordingly, our indemnification obligations

could divert needed financial resources and may adversely affect our business, financial condition, results of operations and cash flows,

and adversely affect prevailing market prices for our common stock.

The extent to which the coronavirus ("COVID-19") outbreak

impacts our business, results of operations and financial condition will depend on future developments, which cannot be predicted.

The COVID-19 pandemic has caused us to modify our business practices (including

employee travel, employee work locations, and cancellation of physical participation in meetings, events and conferences), and we may

take further actions as may be required by government authorities or that we determine are in the best interests of our employees, customers

and business partners.

There is no certainty that such measures will be sufficient to mitigate the risks posed by the virus or otherwise

be satisfactory to government authorities.

The extent to which COVID-19 impacts our business, results of operations

and financial condition will depend on future developments, which are uncertain and cannot be predicted, including, but not limited to,

the duration and spread of the outbreak, its severity, the actions to contain the virus or treat its impact, and how quickly and to what

extent normal economic and operating conditions can resume.

Even after the coronavirus outbreak has subsided, we may continue to experience

materially adverse impacts to our business as a result of its global economic impact, including any recession that has occurred or may

occur in the future.

The disclosures concerning our properties are contained in Item 1 Business

above and incorporated herein by reference.

Legal Proceedings

3 unchanged sentences

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 1A. Risk Factors