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Going Concern | 3 Months Ended
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Jul. 31, 2019
Organization, Consolidation and Presentation of Financial Statements [Abstract] |
Going Concern | Note 2 - Going Concern These financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the settlement of liabilities and commitments in the normal course of business. As reflected in our accompanying financial statements, for the three months ended July 31, 2019, Red Cat had a net loss of $321,502 and used cash in operating activities of $155,329. Additionally, Red Cat had an accumulated deficit of $1,293,324 and does not yet generate revenues. Management believes that these matters raise substantial doubt about Red Cat’s ability to continue as a going concern for twelve months from the issuance date of this report. These financial statements do not include any adjustments related to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern. Management believes Red Cat is well positioned after two-and-a-half years of drone research and software development. Our expertise in encryption, drone flights logs, and producing easy to use analytics will differentiate our soon to be released storage and analytics product. The Company was founded in April 2016 and has operated by using funds raised from accredited investors to build our software platform. Now a public entity with the reverse merger completed in May 2019, investors have gained public market liquidity which should allow us to raise additional funds. We believe that the going concern previously mentioned will be alleviated with the following steps listed:
| · | We are currently working with investment banks to raise our first institutional financing.
| · | We are working on acquisitions that will expedite our software platform revenue
| · | We believe the acquisitions we are pursuing will be accretive once closed
| · | We believe we will complete 2 or 3 acquisitions by our year end
| · | Our commercial software product is launching in fourth quarter of calendar 2019

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- Definition The entire disclosure when substantial doubt is raised about the ability to continue as a going concern. Includes, but is not limited to, principal conditions or events that raised substantial doubt about the ability to continue as a going concern, management's evaluation of the significance of those conditions or events in relation to the ability to meet its obligations, and management's plans that alleviated or are intended to mitigate the conditions or events that raise substantial doubt about the ability to continue as a going concern. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 205 -SubTopic 40 -URI http://asc.fasb.org/subtopic&trid=51888271 + Details
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