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INCOME TAXES | 12 Months Ended
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Nov. 30, 2019
Income Tax Disclosure [Abstract] |
INCOME TAXES [Text Block] |
11. | INCOME TAXES
| Loss before income taxes consists of the following:
|  | Year Ended November 30, |
|  | 2019 |  |  | 2018 |
United States | $ | (4,199,856 | ) | $ | (2,113,412 | )
Foreign |  | (209,929 | ) |  | (40,062 | )
Total | $ | (4,409,785 | ) | $ | (2,153,474 | )
| The Company's provision for income taxes was $Nil in each of the years ended November 30, 2019 and November 30, 2018.
| A reconciliation of the Company's statutory income tax rate to the Company's effective income tax rate is as follows:
| Year Ended November 30,
| 2019 |  | 2018
Income at US statutory rate | 21.00% |  | 21.00%
State taxes, net of Federal benefit | 9.24% |  | 0.00%
Permanent differences | (5.44%) |  | (1.95%)
Tax law change | 0.00% |  | (107.78%)
Foreign rate differential | 0.34% |  | 0.13%
Valuation allowance | (24.34%) |  | 88.60%
Other | (0.79%) |  | 0.00%
Total | 0.00% |  | 0.00%
The net deferred income tax asset balance related to the following:
|  | November 30, |
|  | 2019 |  |  | 2018 |
Depreciation | $ | (88,502 | ) | $ | — |
Stock compensation |  | 96,033 |  |  | — |
Inventory reserve |  | 15,611 |  |  | — |
Net operating loss ("NOL") carryforwards |  | 5,845,058 |  |  | 4,794,900 |
Total deferred tax assets |  | 5,868,199 |  |  | 4,794,900 |
Valuation allowance |  | (5,868,199 | ) |  | (4,794,900 | )
Net deferred tax assets (liabilities) | $ | — |  | $ | — |
| As of November 30, 2019, the Company had federal and state NOL carryforwards of approximately $21.3 million and $6.3 million, respectively, which begin to expire in 2025 for federal and state purposes. The federal NOL carryforwards include approximately $5.0 million, which do not expire. As of November 30, 2019, the Company has Canadian NOL carryforwards of $3.4 million, which begin to expire in 2034. As of November 30, 2019, the Company also has $0.2 million of South African NOLs which do not expire. Future realization of the tax benefits of existing temporary differences and NOL carryforwards ultimately depends on the existence of sufficient taxable income within the carryforward period. As of November 30, 2019 and 2018, respectively, the Company performed an evaluation to determine whether a valuation allowance was needed. The Company considered all available evidence, both positive and negative, which included the results of operations for the current and preceding years. The Company determined that it was not possible to reasonably quantify future taxable income and determined that it is more likely than not that all of the deferred tax assets will not be realized. Accordingly, the Company maintained a full valuation allowance as of November 30, 2019 and 2018. Pursuant to Internal Revenue Code Section 382, use of NOL carryforwards may be limited if the Company experiences a cumulative change in ownership of greater than 50% in a moving three-year period. Ownership changes could impact the Company's ability to utilize the NOL carryforwards remaining at an ownership change date. The Company has not completed a Section 382 study. The calculation of the Company's tax liabilities involves dealing with uncertainties in the application of complex tax laws and regulations for both federal taxes and the many states in which the company operates or does business in. ASC 740 states that a tax benefit from an uncertain tax position may be recognized when it is more likely than not that the position will be sustained upon examination, including resolutions of any related appeals or litigation processes, on the basis of the technical merits. The Company records uncertain tax positions as liabilities in accordance with ASC 740 and adjusts these liabilities when its judgment changes as a result of the evaluation of new information not previously available. Because of the complexity of some of these uncertainties, the ultimate resolution may result in a payment that is materially different from the Company's current estimate of the unrecognized tax benefit liabilities. These differences will be reflected as increases or decreases to income tax expense in the period in which new information is available. As of November 30, 2019 and 2018, respectively, the Company has not recorded any uncertain tax positions in its consolidated financial statements. The Company recognizes interest and penalties related to unrecognized tax benefits on the income tax expense line in the consolidated statements of operations. As of November 30, 2019 and 2018, respectively, no accrued interest or penalties are included on the related tax liability line in the consolidated balance sheets. The Company files tax returns as prescribed by the tax laws of the jurisdictions in which it operates. In the normal course of business, the Company is subject to examination by federal and state jurisdictions, where applicable. There are currently no pending tax examinations. The Company's tax years are still open under statute from November 30, 2016, to the present. The resolution of tax matters is not expected to have a material effect on the Company's consolidated financial statements.

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- Definition The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -URI http://asc.fasb.org/topic&trid=2144680 + Details
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