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Item 1. Financial Statements

2023-08-14 compared with 2023-05-15 · 374 added, 300 removed, 329 unchanged (67% of the section changed)

Financial Statements

Our unaudited consolidated financial statements included in this Form

10-Q are as follows:

Consolidated Balance Sheets as of

March 31, 2023 (unaudited) and December 31, 2022;

Consolidated Statements of Operations for the three

and nine months ended March 31, 2023 and 2022 (unaudited);

Consolidated Statements of Cash Flows for the three

months ended March 31, 2023 and 2022 (unaudited);

Consolidated Statements of Stockholder’s Equity

as of March 31, 2023 and 2022.(unaudited)

Our unaudited consolidated financial statements included

in this Form 10-Q are as follows:

Consolidated Balance Sheets as of June 30, 2023 (unaudited) and December 31, 2022;

Consolidated Statements of Operations for the three and six months ended June 30, 2023 and 2022 (unaudited);

Consolidated Statements of Cash Flows for the six months ended June 30, 2023 and 2022 (unaudited);

Consolidated Statements of Stockholder’s Equity as of June 30, 2023 and 2022.

Notes to Consolidated Financial Statements (unaudited).

These interim consolidated financial statements have been prepared in

accordance with accounting principles generally accepted in the United States of America for interim financial information and the SEC

instructions to Form 10-Q.

These interim consolidated financial statements have been prepared

in accordance with accounting principles generally accepted in the United States of America for interim financial information and the

SEC instructions to Form 10-Q.

In the opinion of management, all adjustments considered necessary for a fair presentation have been included.

Operating results for the interim period ended March 31, 2023 are not necessarily indicative of the results that can be expected for

the full year.

Operating results for the interim period ended June 30, 2023 are not necessarily indicative of the results that can be expected for the

Consolidated Balance Sheets

2 unchanged sentences

Due from related parties

Prepaid and other

current assets

Prepaid and other current assets

Total Current Assets

7 unchanged sentences

Due to related parties

Loans payable

Loans payable - net of discount of $11,250 and $0, respectively

Loans payable - related parties

Convertible note - net of discount of $31,284 and $0, respectively

Derivative liabilities

1 unchanged sentence

Loans payable, non-current

Employee benefits,

Employee benefits, non-current

TOTAL LIABILITIES

1 unchanged sentence

Preferred stock:

Series A Preferred

1,200,000 authorized;

$ 0.001 par value

Series A Preferred stock:

10,000 designated;

$ 0.001 par value,

10,000 shares issued and outstanding, respectively

Series B Preferred

shares issued and outstanding

Series C Preferred

par value, No

Series B Preferred stock:

200,000 designated;

$ 0.001 par value,

21,000 shares issued and outstanding

Series C Preferred stock:

200,000 designated;

$ 0.001 par value, No shares issued and outstanding

Common stock:

and 161,595,511

shares issued and outstanding, respectively

300,000,000 authorized;

$ 0.001 par value

164,656,688 and 161,595,511 shares issued and outstanding, respectively

Additional paid in capital

2 unchanged sentences

( 24,504,395 )

Accumulated other

comprehensive loss

Equity attributable to stockholders of

Deficit attributable

to noncontrolling interests

TOTAL STOCKHOLDERS'

TOTAL LIABILITIES

AND STOCKHOLDERS' EQUITY

Accumulated other comprehensive loss

Equity attributed to stockholders of iQSTEL Inc.

Deficit attributable to noncontrolling interests

TOTAL STOCKHOLDERS' EQUITY

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY

The accompanying notes are

2 unchanged sentences

of Operations

Three Months Ended

Six Months Ended

Cost of revenue

1 unchanged sentence

General and administration

operating expenses

Total operating expenses

Operating loss

2 unchanged sentences

Interest expense

Change in fair value

of derivative liabilities

other income (expense)

Net loss before provision for income

attributable to noncontrolling interests

attributable to stockholders of iQSTEL Inc.

Change in fair value of derivative liabilities

Total other income (expense)

Net loss before provision for income taxes

Net income attributable to noncontrolling interests

Net loss attributed to stockholders of iQSTEL Inc.

$ ( 213,945 )

$ ( 351,180 )

$ ( 577,130 )

$ ( 906,150 )

Comprehensive income (loss)

1 unchanged sentence

$ ( 285,457 )

Foreign currency

$ ( 320,466 )

$ ( 810,188 )

Foreign currency adjustment

Total comprehensive loss

1 unchanged sentence

$ ( 315,896 )

Comprehensive

income attributable to noncontrolling interests

Net comprehensive

(loss) attributable to stockholders of iQSTEL Inc.

$ ( 811,595 )

Comprehensive income attributable to noncontrolling interests

Net comprehensive loss attributed to stockholders of iQSTEL Inc.

$ ( 212,418 )

Basic and diluted

loss per common share

Weighted average

number of common shares outstanding - Basic and diluted

$ ( 351,702 )

$ ( 574,799 )

$ ( 906,868 )

Basic and diluted loss per common share

Weighted average number of common shares outstanding - Basic and diluted

The accompanying notes are

2 unchanged sentences

of Changes in Stockholders’ Equity (Deficit)

For the three months ended

March 31, 2023 and 2022

the three and six months ended June 30, 2023 and 2022

A Preferred Stock

9 unchanged sentences

stock issued for compensation

of derivative liabilities upon exercise of warrants

of derivative liabilities upon exercise of warrant

currency translation adjustments

3 unchanged sentences

$ ( 719,241 )

stock issued for compensation

currency translation adjustments

income (loss)

- June 30, 2023

$ ( 25,081,525 )

$ ( 665,474 )

A Preferred Stock

2 unchanged sentences

Comprehensive Loss

Non Controlling

Total Stockholders’

Controlling Interest

Stockholders’ Deficit

- December 31, 2021

8 unchanged sentences

$ ( 965,962 )

stock issued for compensation

stock issued and to be issued for acquisition of subsidiaries

stock issued for asset acquisition

stock payable

of common stock purchase option

currency translation adjustments

income (loss)

- June 30, 2022

$ ( 19,443,071 )

$ ( 933,796 )

The accompanying notes are

2 unchanged sentences

of Cash Flows

CASH FLOWS FROM OPERATING

Six Months Ended

CASH FLOWS FROM OPERATING ACTIVITIES:

$ ( 320,466 )

$ ( 810,188 )

Adjustments to reconcile net loss to net

cash provided by (used in) operating activities:

Adjustments to reconcile net loss to net cash used in operating activities:

Stock based compensation

Depreciation and amortization

Amortization of debt

Change in fair value

of derivative liabilities

Amortization of debt discount

Change in fair value of derivative liabilities

Changes in operating assets and liabilities:

Accounts receivable

Prepaid and other current

Due from related party

Prepaid and other current assets

Due from related parties

Accounts payable

current liabilities

Net cash provided

by (used in) operating activities

CASH FLOWS FROM INVESTING

Accrued and other current liabilities

Net cash used in operating activities

( 1,435,292 )

CASH FLOWS FROM INVESTING ACTIVITIES:

Acquisitions of subsidiaries, net of cash acquired

( 1,564,132 )

Purchase of property and equipment

Payment of loan receivable - related party

Collection of amounts

due from related parties

Net cash used in

investing activities

CASH FLOWS FROM FINANCING

Advances of loan receivable - related parties

Collection of amounts due from related parties

Net cash used in investing activities

( 1,612,255 )

CASH FLOWS FROM FINANCING ACTIVITIES:

Proceeds from loans payable

Repayments of loans payable

1 unchanged sentence

Proceeds from exercise of warrants

Proceeds from issuance

of common stock purchase options

Net cash provided

by financing activities

Effect of exchange rate changes

Proceeds from convertible notes

Deposit for option

Net cash provided by financing activities

Effect of exchange rate changes on cash

Net change in cash

( 1,688,876 )

Cash, beginning of period

1 unchanged sentence

Supplemental cash flow information

paid for interest

paid for taxes

Cash paid for interest

Cash paid for taxes

Non-cash transactions:

Resolution of derivative

liabilities upon exercise of warrants

Common stock issued for asset acquisition

Common stock issued for acquisitions of subsidiaries

Resolution of derivative liabilities upon exercise of warrants

The accompanying notes are

2 unchanged sentences

Consolidated Financial Statements

March 31, 2023

1 -ORGANIZATION AND DESCRIPTION OF BUSINESS

and Operations

June 30, 2023

NOTE 1 -ORGANIZATION AND DESCRIPTION OF BUSINESS

Organization and Operations

(“iQSTEL”, “we”,

“us”, or the “Company”) was incorporated under the laws of the State of Nevada on June

24, 2011 under the name of B-Maven Inc.

“us”, or the “Company”) was incorporated under the laws of the State of Nevada on June 24, 2011 , under

the name of B-Maven Inc.

The Company changed its name to PureSnax International, Inc.

and more recently it changed its name to iQSTEL Inc.

on September 18, 2015;

and more recently it changed

its name to iQSTEL Inc.

on August 7, 2018.

The Company has been engaged in the business of telecommunication

services as a wholesale carrier of voice, SMS and data for other telecom companies around the World with 404 active interconnection agreements

with mobile companies, fixed line companies and other wholesale carriers.

2 -SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

of Presentation

The Company is a technology company with presence

in 13 countries and 56 employees that is offering leading-edge services through its four business divisions.

The Telecom Division, which represents the majority

of current operations and which also represents the source for all of the Company’s revenues, offers VoIP, SMS, proprietary Internet

of Things (IoT) solutions (www.iotsmartgas.com and www.iotsmarttank.com), and international fiber-optic connectivity through its subsidiaries:

Etelix.com USA, LLC, SwissLink Carrier AG, Smartbiz Telecom LLC, Whisl Telecom LLC, IoT Labs, LLC, and QGlobal SMS, LLC.

The Company’s developing Fintech Business Line

offers a complete Fintech ecosystem MasterCard Debit Card, US Bank Account (No SSN Needed), Mobile App/Wallet (Remittances, Mobile Top

The Company’s Fintech subsidiary, Global Money One Inc., is to provide immigrants access to reliable financial services that

makes it easier to manage their money and stay connected with their families back home.

The Company’s developing BlockChain Platform

Business Line offers our proprietary Mobile Number Portability Application (MNPA) to serve the in-country portability needs through its

subsidiary, itsBchain, LLC.

The Company’s developing Electric Vehicle (EV)

Business Line offers electric motorcycles for work and recreational use in the USA, Spain, Portugal, Panama, Colombia, and Venezuela.

EVOSS is also working on the development of an EV Mid Speed Car to serve the niche of the 2nd car in the family.

NOTE 2 -SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The accompanying unaudited consolidated financial

5 unchanged sentences

the accompanying unaudited interim consolidated financial statements contain all the adjustments necessary (consisting only of normal

recurring accruals) to present the financial position of the Company as of March 31, 2023 and the results of operations and cash flows

recurring accruals) to present the financial position of the Company as of June 30, 2023 and the results of operations and cash flows

for the periods presented.

The results of operations for the three months ended March 31, 2023 are not necessarily indicative of the

operating results for the full fiscal year or any future period.

These unaudited consolidated financial statements should be read in

conjunction with the financial statements and related notes thereto included in the Company’s Annual Report on Form 10-K for the

year ended December 31, 2022 filed with the SEC on April 14, 2023.

Consolidation

The results of operations for the six months ended June 30, 2023 are not necessarily indicative of the operating

results for the full fiscal year or any future period.

These unaudited consolidated financial statements should be read in conjunction

with the financial statements and related notes thereto included in the Company’s Annual Report on Form 10-K for the year ended

December 31, 2022 filed with the SEC on April 14, 2023.

Consolidation Policy

The consolidated financial statements of the Company

3 unchanged sentences

All significant intercompany balances and transactions have been eliminated in consolidation.

Use of Estimates

The preparation of the consolidated financial statements

5 unchanged sentences

estimates and judgments.

Currency Translation and Re-measurement

The Company translates its foreign operations to

Foreign Currency Translation and Re-measurement

The Company translates its foreign operations to U.S.

dollars in accordance with ASC 830, “ Foreign Currency Matters ”.

4 unchanged sentences

SwissLink translates their records into U.S.

liabilities at the rate of exchange in effect at the balance sheet date

historical rate

expense items at the average rate of exchange prevailing during the period

· Assets and liabilities at the

rate of exchange in effect at the balance sheet date;

· Equities at historical rate;

· Revenue and expense items at

the average rate of exchange prevailing during the period.

Adjustments arising from such translations are included

in accumulated other comprehensive income (loss) in stockholders’ equity.

and Cash Equivalents

Cash and cash equivalents include cash in banks,

money market funds, and certificates of term deposits with maturities of less than three months from inception, which are readily convertible

Cash and Cash Equivalents

Cash and cash equivalents include cash in banks, money

market funds, and certificates of term deposits with maturities of less than three months from inception, which are readily convertible

to known amounts of cash and which, in the opinion of management, are subject to an insignificant risk of loss in value.

had no cash equivalents at March 31, 2023 and December 31, 2022.

Receivable and Allowance for Uncollectible Accounts

The Company had no cash

equivalents at June 30, 2023 and December 31, 2022.

Accounts Receivable and Allowance for Uncollectible

Substantially all of the Company’s accounts

3 unchanged sentences

Under the expected credit loss model, the Company reviews its allowance for doubtful accounts daily and past due balances

over 60 days and a specified amount are reviewed individually for collectability.

Account balances are charged off after all means of

collection have been exhausted and the potential for recovery is considered remote.

During the three months ended March 31, 2023 and

2022, the Company recorded no bad debt expense.

Income (Loss) Per Share of Common Stock

over 60 days and a specified amount is reviewed individually for collectability.

Account balances are charged off after all means of collection

have been exhausted and the potential for recovery is considered remote.

During the six months ended June 30, 2023 and 2022, the Company

recorded no bad debt expense.

Net Income (Loss) Per Share of Common Stock

The Company has adopted ASC 260, ”Earnings

8 unchanged sentences

warrants unless the result would be antidilutive.

Dilutive potential common shares include outstanding Series B Preferred stock, and

it was excluded from the computation of diluted net loss per share as the result was anti-dilutive for the three months ended March 31,

2023 and 2022.

Concentrations

of Credit Risk

Dilutive potential common shares include outstanding warrants and Series B Preferred

stock, and these were excluded from the computation of diluted net loss per share as the result was anti-dilutive for the six months ended

June 30, 2023 and 2022.

Concentrations of Credit Risk

The Company’s financial instruments that are

4 unchanged sentences

financial institution may exceed any applicable government insurance limits.

During the three months ended March 31, 2023, 12

customers represented 86 % of

our revenue compared to 4 customers representing 86 % of

our revenue for the three months ended March 31, 2022.

For the three months ended March 31, 2023 and 2022, 62 % and 64 % of

the revenue comes from customers under prepayment conditions which means there is no credit or bad debt risk on that portion of the customers

During the six months ended June 30, 2023, 23 customers

represented 87 % of our revenue compared to 8 customers representing 87 % of our revenue for the six months ended June

Financial Instruments

The Company follows ASC 820, “ Fair Value

12 unchanged sentences

Level 2 applies to assets or liabilities for which

there are inputs other than quoted prices that are observable for the asset or liability such as quoted prices for similar assets or

liabilities in active markets;

quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions

(less active markets);

or model-derived valuations in which significant inputs are observable or can be derived principally from, or

corroborated by, observable market data.

there are inputs other than quoted prices that are observable for the asset or liability such as quoted prices for similar assets or liabilities

in active markets;

quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions (less

active markets);

or model-derived valuations in which significant inputs are observable or can be derived principally from, or corroborated

by, observable market data.

Level 3 applies to assets or liabilities for which

7 unchanged sentences

and due from/to related parties approximate their fair values due to the short-term maturities of these financial instruments.

Transactions involving related parties cannot be

presumed to be carried out on an arm’s-length basis, as the requisite conditions of competitive, free-market dealings may not exist.

Representations about transactions with related parties, if made, shall not imply that the related party transactions were consummated

on terms equivalent to those that prevail in arm’s-length transactions unless such representations can be substantiated.

not, however, practical to determine the fair value of amounts due to related parties due to their related party nature.

Financial Instruments

Transactions involving related parties cannot be presumed

to be carried out on an arm’s-length basis, as the requisite conditions of competitive, free-market dealings may not exist.

Representations

about transactions with related parties, if made, shall not imply that the related party transactions were consummated on terms equivalent

to those that prevail in arm’s-length transactions unless such representations can be substantiated.

It is not, however, practical

to determine the fair value of amounts due to related parties due to their related party nature.

Derivative Financial Instruments

The Company does not use derivative instruments to

3 unchanged sentences

For derivative financial instruments that are accounted for

as liabilities, the derivative instrument is initially recorded at its fair value and is then re-valued at each reporting date, with

changes in the fair value reported in the statements of operations.

For stock-based derivative financial instruments, the Company used

a Black-Scholes valuation model to value the derivative instruments at inception and on subsequent valuation dates.

The classification

of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is evaluated at the end

of each reporting period.

Derivative liabilities are classified in the balance sheet as current or non-current based on whether or not

net-cash settlement or conversion of the instrument could be required within 12 months of the balance sheet date.

as liabilities, the derivative instrument is initially recorded at its fair value and is then re-valued at each reporting date, with changes

in the fair value reported in the statements of operations.

For stock-based derivative financial instruments, the Company used a Black-Scholes

valuation model to value the derivative instruments at inception and on subsequent valuation dates.

The classification of derivative instruments,

including whether such instruments should be recorded as liabilities or as equity, is evaluated at the end of each reporting period.

liabilities are classified in the balance sheet as current or non-current based on whether or not net-cash settlement or conversion of

the instrument could be required within 12 months of the balance sheet date.

Revenue Recognition

The Company recognizes revenue from telecommunication

6 unchanged sentences

The Company’s payment terms vary by client.

Accounting Pronouncements

Recent Accounting Pronouncements

In June 2022, the FASB issued ASU 2022-03, ASC Subtopic

18 unchanged sentences

to cause a material impact on our financial statements.

3 - GOING CONCERN

NOTE 3 - GOING CONCERN

The Company's consolidated financial statements have

1 unchanged sentence

of liabilities in the normal course of business.

The Company has suffered recurring losses from operations and does not have an

established source of revenues sufficient to cover its operating costs.

These conditions raise substantial doubt about the Company’s

ability to continue as a going concern.

The consolidated financial statements do not include any adjustments that might result from the

outcome of this uncertainty.

The Company has suffered recurring losses from operations and does not have an established

source of revenues sufficient to cover its operating costs.

These conditions raise substantial doubt about the Company’s ability

to continue as a going concern.

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

of this uncertainty.

The ability of the Company to continue as a going

10 unchanged sentences

to do so could have a material and adverse effect upon its operations and its stockholders.

4 – PREPAID AND OTHER CURRENT ASSETS

Prepaid and other current assets as of March 31,

NOTE 4 – PREPAID AND OTHER CURRENT ASSETS

Prepaid and other current assets as of June 30, 2023

and December 31, 2022 consisted of the following:

5 unchanged sentences

Security deposit

Process costing

prepaid and other current assets

5 – PROPERTY AND EQUIPMENT

Property and equipment as of March 31, 2023 and December

NOTE 5 – PROPERTY AND EQUIPMENT

Property and equipment as of June 30, 2023 and December

31, 2022 consisted of the following:

3 unchanged sentences

Total property and equipment

Accumulated depreciation

and amortization

Total property

and equipment

Depreciation expense for the three months ended March

31, 2023 and 2022 amounted to $ 34,060

and $ 33,547 ,

respectively.

6 –LOANS PAYABLE

Loans payable as of March 31, 2023 and December 31,

Accumulated depreciation and amortization

Total property and equipment

Depreciation expense for the six months ended June

30, 2023 and 2022 amounted to $ 68,488 and $ 62,371 , respectively.

NOTE 6 –LOANS PAYABLE

Loans payable as of June 30, 2023 and December 31,

2022 consisted of the following:

was issued on October 23, 2018 and due on January 2, 2024

Note was issued on October 23, 2018 and due on January 2, 2024

Darlene Covid19

was issued on April 1, 2020 and due on March 31, 2025

debt discount

Note was issued on April 1, 2020 and due on March 31, 2025

Promissory note payable

Note was issued April 4, 2023 and due on April 4, 2024

Unamortized debt discount

Total loans payable

Current portion

of loans payable

Long-term loans

Loans payable - related parties as of March 31, 2023

Current portion of loans payable

Long-term loans payable

Loans payable - related parties as of June 30, 2023

and December 31, 2022 consisted of the following:

3 unchanged sentences

Note is due on demand

Current portion

of loans payable

Long-term loans

During the three months ended March 31, 2023 and

2022, the Company recorded interest expense of $ 3,645 and $ 7,481 and

recognized amortization of discount, included in interest expense, of $ 0

and $ 7,407 ,

respectively.

Current portion of loans payable

Long-term loans payable

During the six months ended June 30, 2023, the Company

borrowed from a third party totaling $ 165,000 , which includes original issue discount and financing costs of $ 15,000 .

During the six months ended June 30, 2023 and 2022,

the Company recorded interest expense of $ 9,460 and $ 18,724 and recognized amortization of discount, included in interest

expense, of $ 3,750 and $ 7,407 , respectively.

NOTE 7 – CONVERTIBLE NOTE

During the six months ended June 30, 2023, the Company

borrowed from a third party totaling $ 284,760 , which includes original issue discount and financing costs of $ 34,760 .

The note is due

on June 1, 2024 and a one-time interest charge of 12 % shall be applied.

Accrued, unpaid interest and outstanding principal shall be paid

in 10 payments each in the amount of $ 31,893.10 .

The first payment shall be due on July 16, 2023 .

The note is convertible at the option

of the holders at any time following an event of default, and the conversion price is 75% multiplied by the lowest trading price of Company’s

common stock during the 10 trading days prior to the conversion date.

During the six months ended June 30, 2023, the Company

recorded interest expense of $ 3,417 and recognized amortization of discount, included in interest expense, of $ 3,476 .

NOTE 8 – WARRANTS

On April 5, 2022, we entered

2 unchanged sentences

and an initial exercisable date on September 30, 2022 .

The purchase price of this option was $ 500,000 .

The Company determined that the warrants had a fixed monetary value with a variable number of shares at inception and categorized the

warrants as a liability in the accompanying consolidated financial statements.

Holder and the Company agreed that the Holder had the right and the obligation to exercise, on a cashless basis, $1,000,000 of the Options

not later than October 15, 2022 .

Thereafter, the Holder shall undertake to exercise not less than (i) $ 400,000 of

the Options on a “cash basis” not later than the later of (y) November

(z) the date on which there is an effective registration statement permitting the issuance of the Option Shares to or resale of the Option

Shares by the Holder and (ii) an additional $ 400,000 of

the Options on a “cash basis” not later than the latest of (x) thirty (30) days following the exercise of the Option under

subsection (i), above, (y) December 14, 2022, or (z) the date on which there is an effective registration statement permitting the issuance

of the Option Shares to or resale of the Option Shares by the Holder.

From and after the occurrence of the three above-referenced exercises,

each additional exercise of Options hereunder shall be in an amount not less than $ 200,000

exercised only on a cash basis.

Holder’s obligation to exercise each specified portion of this option on the specific dates above is subject to the volume-weighted

average price (“VWAP”, market value), being not less than $0.20 per share on the relevant option exercise date.

option shares at VWAP of $0.20 shall be 48,000,000 shares.

price of this option was $ 500,000 .

The Company determined that the warrants had a fixed monetary value with a variable number of

shares at inception and categorized the warrants as a liability in the accompanying consolidated financial statements.

The Holder and the Company agreed that the Holder

had the right and the obligation to exercise, on a cashless basis, $1,000,000 of the Options not later than October 15, 2022 .

the Holder shall undertake to exercise not less than (i) $ 400,000 of the Options on a “cash basis” not later than

the later of (y) November 14, 2022 or (z) the date on which there is an effective registration statement permitting the issuance

of the Option Shares to or resale of the Option Shares by the Holder and (ii) an additional $ 400,000 of the Options on a “cash

basis” not later than the latest of (x) thirty (30) days following the exercise of the Option under subsection (i), above, (y) December

14, 2022, or (z) the date on which there is an effective registration statement permitting the issuance of the Option Shares to or resale

of the Option Shares by the Holder.

From and after the occurrence of the three above-referenced exercises, each additional exercise of

Options hereunder shall be in an amount not less than $ 200,000 and exercised only on a cash basis.

The Holder’s obligation to exercise each specified

portion of this option on the specific dates above is subject to the volume-weighted average price (“VWAP”, market value),

being not less than $0.20 per share on the relevant option exercise date.

Adjusted option shares at VWAP of $0.20 shall be 48,000,000

A summary of activity regarding warrants issued as

Warrants Outstanding

Weighted Average

Weighted Average Remaining

life (in years)

Exercise Price

Contractual life (in years)

Outstanding, December 31, 2022

2 unchanged sentences

Forfeited/canceled

Outstanding, March 31, 2023

8 – DERIVATIVE LIABILITIES

Fair Value Assumptions Used in Accounting for

Derivative Liabilities

Outstanding, June 30, 2023

NOTE 9 – DERIVATIVE LIABILITIES

Fair Value Assumptions Used in Accounting for Derivative

ASC 815, “ Derivatives and Hedging ,”

2 unchanged sentences

The Company determined our derivative liabilities

to be a Level 3 fair value measurement and used the Black-Scholes pricing model to calculate the fair value as of March 31, 2023.

Black-Scholes model requires six basic data inputs:

the exercise or strike price, time to expiration, the risk-free interest rate, the

current stock price, the estimated volatility of the stock price in the future, and the dividend rate.

Changes to these inputs could

produce a significantly higher or lower fair value measurement.

For the three months ended March 31, 2023 and year

ended December 31, 2022, the estimated fair values of the liabilities measured on a recurring basis are as follows:

to be a Level 3 fair value measurement and used the Black-Scholes pricing model to calculate the fair value as of June 30, 2023.

The Black-Scholes

model requires six basic data inputs:

the exercise or strike price, time to expiration, the risk-free interest rate, the current stock

price, the estimated volatility of the stock price in the future, and the dividend rate.

Changes to these inputs could produce a significantly

higher or lower fair value measurement.

For the six months ended June 30, 2023 and year ended

December 31, 2022, the estimated fair values of the liabilities measured on a recurring basis are as follows:

Expected term

0.25 - 0.75 years

0.75 - 1.49 years

Expected average volatility

1 unchanged sentence

Risk-free interest rate

4.67 % - 5.43 %

0.06 % - 4.73 %

The following table summarizes the changes in the

derivative liabilities during the three months ended March 31, 2023 and 2022:

Fair Value Measurements Using Significant Observable Inputs

derivative liabilities during the six months ended June 30, 2023 and 2022:

Value Measurements Using Significant Observable Inputs (Level 3)

Balance - December 31, 2022

1 unchanged sentence

Change in fair value of the warrant

Balance - March 31, 2023

Balance – June 30, 2023

The following table summarizes the change in fair

value of derivative liabilities included in the income statement for the three months ended March 31, 2023 and 2022, respectively.

Three months ended

Addition of new derivatives recognized as loss on derivatives

Revaluation of derivative liabilities

Change in fair value of derivative liabilities

value of derivative liabilities included in the income statement for the six months ended June 30, 2023 and 2022, respectively.

of new derivatives recognized as loss on derivatives

of derivative liabilities

on change in fair value of derivative liability

$ ( 342,575 )

9 – STOCKHOLDERS’ EQUITY

NOTE 10 – STOCKHOLDERS’ EQUITY

The Company’s authorized capital consists of 300,000,000 shares

of common stock with a par value of $ 0.001 per

of common stock with a par value of $ 0.001 per share.

Series A Preferred Stock

November 3, 2020, pursuant to Article III of our Articles of Incorporation, our Board of Directors voted to designate a class of preferred

stock entitled Series A Preferred Stock, consisting of up 10,000 shares,

par value $ 0.001 .

Under the Certificate of Designation, holders of Series A Preferred Stock will participate on an equal basis per-share with holders of

our common stock in any distribution upon winding up, dissolution, or liquidation.

Holders of Series A Preferred Stock are entitled to

vote together with the holders of our common stock on all matters submitted to stockholders at a rate of 51% of the total vote of stockholders.

On November 3, 2020, pursuant to Article III of our

Articles of Incorporation, our Board of Directors voted to designate a class of preferred stock entitled Series A Preferred Stock, consisting

of up 10,000 shares, par value $ 0.001 .

Under the Certificate of Designation, holders of Series A Preferred Stock will

participate on an equal basis per-share with holders of our common stock in any distribution upon winding up, dissolution, or liquidation.

Holders of Series A Preferred Stock are entitled to vote together with the holders of our common stock on all matters submitted to stockholders

at a rate of 51% of the total vote of stockholders.

The rights of the holders of Series A Preferred Stock

are defined in the relevant Certificate of Designation filed with the Nevada Secretary of State on November 3, 2020.

As of March 31, 2023 and December 31, 2022, 10,000 shares

As of June 30, 2023 and December 31, 2022, 10,000 shares

of Series A Preferred Stock were issued and outstanding.

Series B Preferred Stock

November 11, 2020, pursuant to Article III of our Articles of Incorporation, our Board of Directors voted to designate a class of preferred

stock entitled Series B Preferred Stock, consisting of up 200,000 shares,

par value $ 0.001 .

Under the Certificate of Designation, holders of Series B Preferred Stock will receive a liquidation preference of $81 per share in any

distribution upon winding up, dissolution, or liquidation of the Company before junior security holders, as provided in the designation.

Holders of Series B Preferred Stock are entitled to receive as, when, and if declared by the Board of Directors, dividends in kind at

an annual rate equal to twenty four percent (24%) of $81 per share for each of the then outstanding shares of Series B Preferred Stock,

calculated on the basis of a 360-day year consisting of twelve 30-day months.

Holders of Series B Preferred Stock do not have voting

rights but may convert into common stock after twelve months from the issuance date, at a conversion rate of one thousand (1,000) shares

of Common Stock for every one (1) share of Series B Preferred Stock.

Upon conversion, the shares are subject to a one-year restriction

on sales into the market of no more than 5% previous month’s stock liquidity.

As of March 31, 2023 and December 31, 2022, 21,000 shares

On November 11, 2020, pursuant to Article III of our

Articles of Incorporation, our Board of Directors voted to designate a class of preferred stock entitled Series B Preferred Stock, consisting

of up 200,000 shares, par value $ 0.001 .

Under the Certificate of Designation, holders of Series B Preferred Stock

will receive a liquidation preference of $81 per share in any distribution upon winding up, dissolution, or liquidation of the Company

before junior security holders, as provided in the designation.

Holders of Series B Preferred Stock are entitled to receive as, when,

and if declared by the Board of Directors, dividends in kind at an annual rate equal to twenty four percent (24%) of $81 per share for

each of the then outstanding shares of Series B Preferred Stock, calculated on the basis of a 360-day year consisting of twelve 30-day

Holders of Series B Preferred Stock do not have voting rights but may convert into common stock after twelve months from the issuance

date, at a conversion rate of one thousand (1,000) shares of Common Stock for every one (1) share of Series B Preferred Stock.

Upon conversion,

the shares are subject to a one-year restriction on sales into the market of no more than 5% previous month’s stock liquidity.

As of June 30, 2023 and December 31, 2022, 21,000 shares

of Series B Preferred Stock were issued and outstanding.

Series C Preferred Stock

January 7, 2021, pursuant to Article III of our Articles of Incorporation, our Board of Directors voted to designate a class of preferred

stock entitled Series C Preferred Stock, consisting of up 200,000 shares,

par value $ 0.001 .

Under the Certificate of Designation, holders of Series C Preferred Stock will rank junior to the Series B Preferred Stock, but on par

with common stock and Series A Preferred Stock in any distribution upon winding up, dissolution, or liquidation of the company, as provided

in the designation.

The holders of shares of Series C Preferred Stock have no dividend rights except as may be declared by the Board

in its sole and absolute discretion, out of funds legally available for that purpose.

Holders of Series C Preferred Stock do not have

voting rights but may convert into common stock after twenty four months from the issuance date, at a conversion rate of one thousand

(1,000) shares of Common Stock for every one (1) share of Series C Preferred Stock.

Upon conversion, the shares are subject to a one-year

restriction on sales into the market of no more than 5% previous month’s stock liquidity.

On January 7, 2021, pursuant to Article III of our

Articles of Incorporation, our Board of Directors voted to designate a class of preferred stock entitled Series C Preferred Stock, consisting

of up 200,000 shares, par value $ 0.001 .

Under the Certificate of Designation, holders of Series C Preferred Stock

will rank junior to the Series B Preferred Stock, but on par with common stock and Series A Preferred Stock in any distribution upon winding

up, dissolution, or liquidation of the company, as provided in the designation.

The holders of shares of Series C Preferred Stock have

no dividend rights except as may be declared by the Board in its sole and absolute discretion, out of funds legally available for that

Holders of Series C Preferred Stock do not have voting rights but may convert into common stock after twenty four months from

the issuance date, at a conversion rate of one thousand (1,000) shares of Common Stock for every one (1) share of Series C Preferred Stock.

Upon conversion, the shares are subject to a one-year restriction on sales into the market of no more than 5% previous month’s stock

The rights of the holders of Series C Preferred Stock

are defined in the relevant Certificate of Designation filed with the Nevada Secretary of State on January 7, 2021.

As of March 31, 2023 and December 31, 2022, no Series

As of June 30, 2023 and December 31, 2022, no Series

C Preferred Stock was issued or outstanding.

During the three months ended March 31, 2023, the

Company issued 3,001,177 shares

of common stock, valued at fair market value on issuance as follows:

compensation to our directors valued at $ 11,230

exercise of warrants for $ 400,000

As of March 31, 2023 and December 31, 2022, 164,596,688

and 161,595,511

shares of common stock were issued and outstanding, respectively.

10 - RELATED PARTY TRANSACTIONS

Due from related party

As of March 31, 2023 and December 31, 2022, the Company

had amounts due from related parties of $ 400,893

and $ 326,324 ,

respectively.

The loans are unsecured, non-interest bearing and due on demand.

During the six months ended June 30, 2023, the Company

issued 3,061,177 shares of common stock, valued at fair market value on issuance as follows:

· 120,000 shares for compensation

to our directors valued at $ 18,130 ;

· 2,941,177 shares for exercise

of warrants for $ 400,000 .

As of June 30, 2023 and December 31, 2022, 164,656,688 and 161,595,511 shares

of common stock were issued and outstanding, respectively.

NOTE 11 - RELATED PARTY TRANSACTIONS

Due from related parties

As of June 30, 2023 and December 31, 2022, the Company

had amounts due from related parties of $ 426,529 and $ 326,324 , respectively.

The loans are unsecured, non-interest bearing

and due on demand.

Due to related parties

As of March 31, 2023 and December 31, 2022, the Company

As of June 30, 2023 and December 31, 2022, the Company

had amounts due to related parties of $ 26,613 .

1 unchanged sentence

Employment agreements

During the three months ended March 31, 2023 and

2022, the Company recorded management salaries of $ 144,000

and stock-based compensation bonuses of $ 11,230 and $ 41,139 ,

respectively.

As of March 31, 2023 and December 31, 2022, the Company

recorded and accrued management salaries of $ 104,628

During the six months ended June 30, 2023 and 2022,

the Company recorded management salaries of $ 288,000 and $ 270,000 and stock-based compensation bonuses of $ 18,130 and $ 71,629 ,

respectively.

11 – COMMITMENTS AND CONTINGENCIES

As of June 30, 2023 and December 31, 2022, the Company

recorded and accrued management salaries of $ 129,627 and $ 79,628 , respectively.

NOTE 12 – COMMITMENTS AND CONTINGENCIES

Leases and Long-term Contracts

1 unchanged sentence

contracts or commitments.

The Company leases facilities which the term is 12

For the three months ended March 31, 2023 and 2022, the Company incurred rent expense of $ 900 and $ 20,150 ,

respectively.

12 - SEGMENTS

The Company leases facilities which the term is 12 months .

For the six months ended June 30, 2023 and 2022,

the Company incurred rent expense of $ 2,137 and $ 38,645 , respectively.

NOTE 13 - SEGMENTS

At December 31, 2022 and 2021, the Company operates

3 unchanged sentences

The following table shows operating activities information

by geographic segment for the three months ended March 31, 2023 and 2022:

Three months ended March 31, 2023

NOTE 12 - SEGMENT

- Schedule of Operating Activities by Geographic Segment

by geographic segment for the six months ended June 30, 2023 and 2022:

Three months ended June 30, 2023

NOTE 13 - SEGMENT - Schedule of Operating Activities

by Geographic Segment

$ ( 1,469,389 )

3 unchanged sentences

General and administration

Operating loss

Other income (expense)

$ ( 147,060 )

$ ( 161,644 )

months ended June 30, 2022

$ ( 596,754 )

Cost of revenue

Operating expenses

General and administration

Operating loss

Other income (expense)

$ ( 266,878 )

$ ( 285,457 )

months ended June 30, 2023

$ ( 2,997,966 )

Cost of revenue

( 2,997,966 )

Operating expenses

General and administration

Operating (loss) income

2 unchanged sentences

$ ( 320,466 )

Three months ended March 31, 2022

months ended June 30, 2022

$ ( 678,636 )

Cost of revenue

2 unchanged sentences

Operating loss

Other (expense) income

Net (loss) income

Other income (expense)

$ ( 796,858 )

$ ( 810,188 )

Asset Information

The following table shows asset information by geographic

segment as of March 31, 2023 and December 31, 2022:

March 31, 2023

segment as of June 30, 2023 and December 31, 2022:

June 30, 2023

Current assets

5 unchanged sentences

Non-current liabilities

13 – SUBSEQUENT EVENTS .

December 31, 2022

Current assets

$ ( 1,232,653 )

Non-current assets

$ ( 6,184,562 )

Current liabilities

$ ( 1,232,653 )

Non-current liabilities

NOTE 14 – SUBSEQUENT EVENTS .

Management has evaluated subsequent events through

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-Q

Item 1. Financial Statements