Healthcare Integrated Technologies Inc
For the period ended Apr 30, 2024. Filed Jun 20, 2024.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Apr 30, 2024 · Filed Jun 20, 2024
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What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-01-31; filed 2024-03-18.
0001493152-24-010237
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2024-04-30; filed 2024-06-20.
0001493152-24-024375
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 98 previous paragraphs and 102 current paragraphs.
71 unchanged; 23 reworded; 8 added; 4 removed; 0 previous and 0 current paragraphs rearranged.
Tables are not compared: 6 previous and 6 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (8)
Current report
During the three months ended April 30, 2024, we recognized $60,283 in revenue from our service agreement that ended April 1, 2024. We have been unable to obtain extensions or additional agreements that would allow us to continue recognizing revenue in subsequent periods. We had no revenue during the three months ended April 30, 2023.
Current report
Travel and Entertainment - Travel and entertainment expenses increased $13,243 over the same period in the prior year. The increase in travel and entertainment expenses is directly attributable to focused capital raising effort and actively evaluating acquisition opportunities during the period.
Current report
Advertising and Marketing - Advertising and marketing expenses increased $1,571 over 2023. The increase is primarily attributable to a $1,497 increase in expenses related to conferences and conventions during 2024.
Current report
*Other -*Other expenses decreased $3,412, or 62%, over the same period in the prior year. The decrease from 2023 primarily results from a $2,954 decrease in office expenses.
Current report
During the nine months ended April 30, 2024, we recognized $82,052 in revenue from our service agreement that ended April 1, 2024. We have been unable to obtain extensions or additional agreements that would allow us to continue recognizing revenue in subsequent periods. We had no revenue during the nine months ended April 30, 2023.
Current report
Travel and Entertainment - Travel and entertainment expenses increased $13,759 over the same period in the prior year. The increase in travel and entertainment expenses is directly attributable to focused capital raising effort and actively evaluating acquisition opportunities during the period.
Current report
*Other -*Other expenses decreased $2,784, or 41%, over the same period in the prior year. The decrease from 2023 primarily results from a $2,443 decrease in office expenses.
Current report
Current liabilities for the interim period ended April 30, 2024 increased $15,142 as compared to the fiscal year ended July 31, 2023. The increase is due to a $28,471 increase in accounts payable and accrued expenses, a $184,082 increase in payroll related liabilities as we continue to accrue officer compensation, and a $18,604 increase in notes payable to related parties, which were offset by a $216,015 reduction in short-term loans and accrued expenses owed to related parties.
Removed paragraphs (4)
Previous report
We recognized $21,769 in revenue from our contracts during the three month period ended January 31, 2024. We had no revenue during the three month period ended January 31, 2023.
Previous report
We recognized $21,769 in revenue from our contracts during the six month period ended January 31, 2024. We had no revenue during the six month period ended January 31, 2023.
Previous report
*Advertising and Marketing -*Advertising and marketing expense decreased $1,125, or 30%, over the same period in the prior year. The decrease is primarily due to the elimination of a contract sales and marketing representative we had in 2023 that was partially offset by an increase in expenses related to conferences and trade shows.
Previous report
Current liabilities for the interim period ended January 31, 2024 increased $516,732 as compared to the fiscal year ended July 31, 2023. The increase is due to increases in accounts payable and accrued expenses, short-term loans from related parties to meet cash flow needs, the continuing accrual of officer’s compensation and the liability associated with the Signature contract.
Reworded paragraphs (23)
Previous wording
This following discussion summarizes the significant factors affecting the interim consolidated financial statements, financial condition, liquidity, and cash flows of Healthcare Integrated Technologies, Inc, for the six months ended January 31, 2024 and 2023. The discussion and analysis should be read in conjunction with the consolidated financial statements and notes thereto included in our most recent Annual Report on Form 10-K for the year ended July 31, 2023 as filed with the SEC on November 13, 2023.
Current wording
This following discussion summarizes the significant factors affecting the interim consolidated financial statements, financial condition, liquidity, and cash flows of Healthcare Integrated Technologies, Inc, for the nine months ended April 30, 2024 and 2023. The discussion and analysis should be read in conjunction with the consolidated financial statements and notes thereto included in our most recent Annual Report on Form 10-K for the year ended July 31, 2023 as filed with the SEC on November 13, 2023.
Previous wording
Our mission is to grow a profitable healthcare technology company by focusing on our core product, continuing the development of our proprietary software, and developing new uses and product lines for our technology. Our management team is focused on maintaining the financial flexibility and assembling the right complement of personnel and outside consultants required to successfully execute our mission.
Current wording
Our mission is to grow a profitable healthcare technology company by focusing on our core product, continuing the development of our proprietary software, and developing new uses and product lines for our technology. Our management team is focused on maintaining financial flexibility and assembling the right complement of personnel and outside consultants required to successfully execute our mission.
Previous wording
We continue to utilize funds raised from the private sales of our common stock, issuance of debt, and short-term advances from related parties to provide cash for our operations, which has allowed us to continue refining our initial product and readying it for pilot testing, developing future product offerings and adding talented individuals to our management team and on a contract basis. Highlighted achievements for the six months ended January 31, 2024 include:
Current wording
We continue to utilize funds raised from the private sales of our common stock, issuance of debt, and short-term advances from related parties to provide cash for our operations, which has allowed us to continue refining our initial product and readying it for pilot testing, developing future product offerings and adding talented individuals to our management team and on a contract basis. Highlighted achievements for the nine months ended April 30, 2024 include:
Previous wording
Officers’ Salaries - Officers’ salaries decreased $37,309, or 30%, over 2023. The decrease is a result of the Company’s officers accepting voluntary pay reductions to better reflect time commitments and reduce operating cost during the start-up phase.
Current wording
Officers’ Salaries - Officers’ salaries decreased $37,264, or 30%, over 2023. The decrease is a result of the Company’s officers accepting voluntary pay reductions to better reflect time commitments and reduce operating cost during the start-up phase.
Previous wording
*Professional Fees -*Professional fees decreased $4,439, or 8%. over the same period in the prior year. The decrease from 2023 primarily results from a $5,016 decrease in accounting fees and a $2,366 decrease in SEC filing fees, which were partially offset by a $2,797 increase in fees related to patents. The remaining difference results from a small net decrease in legal and transfer agent fees.
Current wording
*Professional Fees -*Professional fees decreased $14,223, or 48%, over the same period in the prior year. The decrease from 2023 primarily results from a $16,284 decrease in legal fees and a $5,000 decrease in the expense for outside consultants, which were partially offset by a $2,000 increase in accounting fees and a $4,081 increase in patent related costs. The remaining difference results from a small net increase in transfer agent and SEC filing costs.
Previous wording
Software Development – Software development expenses increased $4,381 over 2023. Prior to this period, our internally developed software had not been placed in service and software development cost were being capitalized.
Current wording
Software Development - Software development expenses increased $7,006 over 2023. Prior to this period, our internally developed software had not been placed in service and software development cost were being capitalized.
Previous wording
*Stock-based Compensation -*Stock-based compensation expense decreased $88,950, or 96%, from the same period in the prior year. The decrease results from a 2024 reduction in the amortization of the grant date fair value of employee stock options and restricted stock awards granted to our CEO, CFO, CTO and CMO. The decreases were partially offset by the additional expense related to the issuance of new shares and restricted stock grants to outside consultants.
Current wording
*Stock-based Compensation -*Stock-based compensation expense decreased $14,482, or 16%, from the same period in the prior year. The decrease results from a 2024 reduction in the amortization of the grant date fair value of employee stock options and restricted stock awards granted to our CEO, CFO, CTO and CMO. The decreases were partially offset by the additional expense related to the issuance of restricted stock awards and warrants to outside consultants.
Previous wording
Amortization- Amortization expense increased $45,921 over 2023. The increase in amortization expense primarily relates to the amortization of capitalized software development cost during the three months ended January 31, 2024 that had not yet been placed in service during the prior period.
Current wording
Amortization- Amortization expense increased $54,087 over 2023. The increase in amortization expense primarily relates to the amortization of capitalized software development cost during the three months ended April 30, 2024 that had not yet been placed in service during the prior period.
Previous wording
Interest Expense - Interest expense decreased $106,627, or 89%, over the same period in the prior year. Interest expense decreased due to a paydown and refinance of debt in June of 2023. The prior loan, which was in place during 2023, had a larger principal balance and associated fees that were initially recorded as debt discount and were being amortized as a component of interest expense.
Current wording
Interest Expense - Interest expense decreased $105,569, or 89%, over the same period in the prior year. Interest expense decreased due to a paydown and refinance of debt in June of 2023. The prior loan, which was in place during 2023, had a larger principal balance and associated fees that were initially recorded as debt discount and were being amortized as a component of interest expense.
Previous wording
Change in Fair Value of Derivative Liability – We had no derivative liability during the second quarter of fiscal 2024 and, accordingly, no change in the fair value of derivative liability. The change in the fair value of the derivative liability in 2023 was associated with debt that was retired in June of 2023.
Current wording
Change in Fair Value of Derivative Liability – We had no derivative liability during the third quarter of fiscal 2024 and, accordingly, no change in the fair value of derivative liability. The change in the fair value of derivative liability in 2023 was associated with debt that was retired in June of 2023.
Previous wording
Six Months Ended January 31, 2024 Compared to the Six Months Ended January 31, 2023
Current wording
Nine Months Ended April 30, 2024 Compared to the Nine Months Ended April 30, 2023
Previous wording
The table below presents a comparison of our operating expenses for the six months ended January 31, 2024 and 2023:
Current wording
The table below presents a comparison of our operating expenses for the nine months ended April 30, 2024 and 2023:
Previous wording
Officers’ Salaries - Officers’ salaries decreased $74,572, or 30%, over 2023. The decrease is a result of the Company’s officers accepting voluntary pay reductions to better reflect time commitments and reduce operating cost during the start-up phase.
Current wording
Officers’ Salaries - Officers’ salaries decreased $111,836, or 30%, over 2023. The decrease is a result of the Company’s officers accepting voluntary pay reductions to better reflect time commitments and reduce operating cost during the start-up phase.
Previous wording
*Professional Fees -*Professional fees decreased $15,520, or 57%. over the same period in the prior year. The decrease from 2023 primarily results from a $18,750 decrease in the expense for outside consultants for raising capital, which was partially offset by a $2,073 increase in accounting fees and a $2,047 increase in fees related to patents. The remaining difference results from a small net decrease in legal, transfer agent and SEC filing costs.
Current wording
*Professional Fees -*Professional fees decreased $32,412, or 32%, over the same period in the prior year. The decrease from 2023 primarily results from a $18,750 decrease in the expense for outside consultants, $17,151 decrease in legal fees and a $3,016 decrease in accounting fees, which were partially offset by a $6,878 increase in patent related costs. The remaining difference results from a small net decrease in transfer agent and SEC filing costs.
Previous wording
Software Development – Software development expenses increased $8,281 over 2023. Prior to this period, our internally developed software had not been placed in service and software development cost were being capitalized.
Current wording
Software Development - Software development expenses increased $15,287 over 2023. Prior to this period, our internally developed software had not been placed in service and software development cost were being capitalized.
Previous wording
*Stock-based Compensation -*Stock-based compensation expense decreased $138,077, or 84%, from the same period in the prior year. The decrease results from a 2024 reduction in the amortization of the grant date fair value of employee stock options and restricted stock awards granted to our CEO, CFO, CTO and CMO. The decreases were partially offset by the additional expense related to the issuance of new shares and restricted stock grants to outside consultants.
Current wording
*Stock-based Compensation -*Stock-based compensation expense decreased $138,809, or 57%, from the same period in the prior year. The decrease results from a 2024 reduction in the amortization of the grant date fair value of employee stock options and restricted stock awards granted to our CEO, CFO, CTO and CMO. The decreases were partially offset by the additional expense related to the issuance of restricted stock awards and warrants to outside consultants.
Previous wording
Amortization- Amortization expense increased $99,529 over 2023. The increase in amortization expense primarily relates to the amortization of capitalized software development cost during the six months ended January 31, 2024 that had not yet been placed in service during the prior period.
Current wording
Amortization- Amortization expense increased $153,616 over 2023. The increase in amortization expense primarily relates to the amortization of capitalized software development cost during the nine months ended April 30, 2024 that had not yet been placed in service during the prior period.
Previous wording
The table below presents a comparison of our other income (expense) for the six months ended January 31, 2024 and 2023:
Current wording
The table below presents a comparison of our other income (expense) for the nine months ended April 30, 2024 and 2023:
Previous wording
Interest Expense - Interest expense decreased $206,669, or 89%, over the same period in the prior year. Interest expense decreased due to a paydown and refinance of debt in June of 2023. The prior loan, which was in place during 2023, had a larger principal balance and associated fees that were initially recorded as debt discount and were being amortized as a component of interest expense.
Current wording
Interest Expense - Interest expense decreased $312,238, or 89%, over the same period in the prior year. Interest expense decreased due to a paydown and refinance of debt in June of 2023. The prior loan, which was in place during 2023, had a larger principal balance and associated fees that were initially recorded as debt discount and were being amortized as a component of interest expense.
Previous wording
Current assets for the interim period ended January 31, 2024 increased $370,298 as compared to the fiscal year ended July 31, 2023. The increase is primarily due to an increase in cash and accounts receivable related to the new Signature contract.
Current wording
Current assets for the interim period ended April 30, 2024 increased $12,549 as compared to the fiscal year ended July 31, 2023. The increase is primarily due to an increase in accounts receivable related to the new Signature contract.
Previous wording
We currently do not have a recurring revenue source and will continue to have negative cash flow from operations for the near future. The factors in determining operating cash flows are largely the same as those that affect net earnings, except for non-cash expenses such as depreciation and amortization, stock-based compensation, and cash received from deferred revenue, which affect earnings but do not affect operating cash flow. Net cash provided by operating activities was $187,571 for the six months ended January 31, 2024 as compared to net cash used by operating activities of $60,891 for the six months ended January 31, 2023. The $248,462 increase in net cash provided (used) by operating activities during 2024 is primarily attributable to the receipt of $105,189 in deferred revenue and a net change of $135,058 in accounts receivable and accounts payable and accrued expenses, all of which are primarily related to two new contracts this period.
Current wording
We currently do not have a recurring revenue source and will continue to have negative cash flow from operations for the near future. The factors in determining operating cash flows are largely the same as those that affect net earnings, except for non-cash expenses such as depreciation and amortization, stock-based compensation, and cash received from deferred revenue, which affect earnings but do not affect operating cash flow. Net cash used by operating activities was $198,352 and $77,565 for the nine months ended April 30, 2024 and 2023, respectively. as compared to net cash used by operating activities of $77,565 for the nine months ended April 30, 2023. The $120,787 increase in net cash used by operating activities during 2024 is attributable to a $202,436 decrease in the adjusted net loss from operations that is offset by a $323,223 decrease in changes in operating assets and liabilities from the 2023 amounts. The $202,436 decrease in the adjusted net loss from operations primarily results from a $82,052 increase in revenues and a $111,836 decrease in officer’s compensation. The $323,223 decrease in changes in operating assets and liabilities primarily results from $302,643 in payments to related parties that significantly reduced short-term related party loans and accrued expenses.
Previous wording
Net cash used by investing activities was $-0- and $5,610 for the six months ended January 31, 2024 and 2023, respectively. The amount is generally comprised of cash paid for the filing of patent applications and for the development of software for our internal use.
Current wording
Net cash used by investing activities was $-0- and $22,388 for the nine months ended April 30, 2024 and 2023, respectively. The amount is generally comprised of cash paid for the filing of patent applications and for the development of software for our internal use.
Previous wording
Net cash provided by financing activities was $127,797 for the six months ended January 31, 2024, which represents a $62,331 increase over the same period of 2023. The increase resulted from a $100,000 increase in net proceeds received from the issuance of common stock for cash, which was partially offset by less net proceeds from related party loans in 2024 as compared to 2023.
Current wording
Net cash provided by financing activities was $197,971 for the nine months ended April 30, 2024, which represents a $16,731 increase over the same period of 2023. The 2024 increase primarily resulted from a $150,000 decrease in principal reduction payments on short term debt, that was partially offset by a $135,898 increase in payments to related parties for amounts owed for short-term loans and accrued expenses.