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Restatement of Previously Issued Consolidated Financial Statements | 12 Months Ended
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Dec. 31, 2017
Restatement of Previously Issued Consolidated Financial Statements [Abstract] |
RESTATEMENT OF PREVIOUSLY ISSUED CONSOLIDATED FINANCIAL STATEMENTS |
2. | RESTATEMENT OF PREVIOUSLY ISSUED CONSOLIDATED FINANCIAL STATEMENTS
During the preparation of our Annual Report on Form 20-F for the fiscal year of 2017, the Company has discovered error in the accounting treatment of the warrants issued in connection with the SPA with HLI (Note 15), which resulted in misstatements in its previously issued consolidated financial statements for the year ended December 31, 2016. The Company is amending and restating its 2016 financial statements to reclassify the warrants to HLI as derivative liabilities and to report any changes in their fair value up to the earlier of the date of the exercise or the reporting date in earnings. The Company has performed a thorough reassessment of the terms of its warrants with reference to the provisions of ASC Topic 815-40-15-7I, regarding its exposure to changes in currency exchange rates. This reassessment has led to the management’s conclusion that the Company’s warrants issued to HLI should not be considered indexed to the Company’s own stock because the warrants are denominated in U.S. dollar, which is different from the Company’s functional currency, Renminbi The consolidated financial statements for the year ended December 31, 2016 have been restated to reflect the correction of the misstatements. The Company has also corrected certain related disclosures to the consolidated financial statements. As a result, the Company has restated its consolidated financial statements in accordance with ASC 250, Accounting Changes and Error Corrections (the “restated consolidated The impact of these restatements on the consolidated financial statements as previously reported is summarized below:
|  | As of December 31, 2016 |
|  | As previously reported |  |  | Restated |
OTHER LIABILITIES |  |  |  |  |  |
Warrants liability |  | $ | - |  |  | $ | 1,499,362 |
Total Liabilities |  | $ | 1,115,074 |  |  | $ | 2,614,436 |
Additional paid-in capital |  |  | 39,150,635 |  |  |  | 37,261,366 |
Accumulated deficit |  |  | (26,499,675 | ) |  |  | (26,109,768 | )
Total Equity |  | $ | 15,437,063 |  |  | $ | 13,937,701 |
|  | For the year ended December 31, 2016 |
|  | As previously reported |  |  | Restated |
Change in fair value of warrants liability |  | $ | 137,710 |  |  | $ | 527,617 |
Loss before provision for income tax and non-controlling interest |  |  | (10,094,668 | ) |  |  | (9,704,761 | )
Net loss from continuing operations |  |  | (9,999,642 | ) |  |  | (9,609,735 | )
Net loss |  |  | (10,250,795 | ) |  |  | (9,860,888 | )
Net loss attributable to Lianluo Smart Limited |  |  | (10,121,775 | ) |  |  | (9,731,868 | )
Comprehensive loss |  |  | (10,817,957 | ) |  |  | (10,428,050 | )
Comprehensive loss attributable to Lianluo Smart Limited |  |  | (10,587,119 | ) |  |  | (10,197,212 | )
Loss per share |  |  |  |  |  |  |  |
- Basic |  | $ | (0.97 | ) |  | $ | (0.93 | )
- Diluted |  |  | (0.97 | ) |  |  | (0.93 | )

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- Definition Tabular disclosure of the nature and effects of a restatement to correct an error in the reported results of operations of prior periods. When prior period adjustments are recorded, the resulting effects (both gross and net of applicable income tax) on the net income of prior periods are disclosed in the annual report for the year in which the adjustments are made, and amended filings of previously issued reports are typically issued. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 250 -SubTopic 10 -Section 50 -Paragraph 8 -URI http://asc.fasb.org/extlink&oid=109234566&loc=d3e22658-107794 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 250 -SubTopic 10 -Section 50 -Paragraph 7 -URI http://asc.fasb.org/extlink&oid=109234566&loc=d3e22644-107794 Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 250 -SubTopic 10 -Section 50 -Paragraph 9 -URI http://asc.fasb.org/extlink&oid=109234566&loc=d3e22663-107794 + Details
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