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DISCONTINUED OPERATIONS | 12 Months Ended
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Dec. 31, 2023
DISCONTINUED OPERATIONS |
DISCONTINUED OPERATIONS | NOTE 6 – DISCONTINUED OPERATIONS On August 4, 2023, (i) Recruiter.com Consulting and Insigma, Inc.(“Insigma”), a wholly owned subsidiary of Futuris Company (“FTRS”), entered into an asset purchase agreement (“Insigma Agreement”) and (ii) Recruiter.com Consulting and Akvarr, Inc., (“Akvarr”) and a wholly owned subsidiary of FTRS, entered into an asset purchase agreement (“Insigma Agreement”). Upon the terms and subject to the conditions of the agreements, the Company agreed to sell its right, title, and exclusive interest in certain client contracts and associated staff, contractors, business information, and relationships related staffing and consulting services revenue stream (“Assets Sold”) to Insigma and Akvarr. The Company’s carrying net book value of the related assets and liabilities in connection with assets sale under the Insigma Agreement as of December 31, 2023, was $0. As consideration for the assets sold, and upon completion of the assignment of certain acquired assets to Insigma, Insigma would issue to the Company a number of shares of common stock of FTRS equal to $500,000 based on the 30-day volume weighted average price preceding the closing date, as defined. The Insigma Agreement also provides for the payment of up to $2,000,000 of additional cash consideration as an earnout payment to the Company, which shall be payable in monthly installments beginning 30 days from the closing date and based on the Gross Margin (as defined in the Insigma Agreement) generated by the acquired assets. On October 2, 2023, the Company and Insigma finalized the transfer based on the Closing Date (as defined in the Insigma Agreement). On October 5, 2023, the Company received 9,518,605 shares of common stock of FTRS. The shares were valued at $551,127 based on October 2, 2023, stock price of $0.0579. The Company determined all of the required criteria for held-for-sale in accordance with ASC 205-20-45-1E and discontinued operations classification were met as of December 31, 2023. In accordance with ASC 205-20, Presentation of Financial Statements: Discontinued Operations, a disposal of a component of an entity or a group of components of an entity (disposal group) is required to be reported as discontinued operations if the disposal represents a strategic shift that has (or will have) a major effect on an entity’s operations and financial results when the disposal group meets the criteria to be classified as held-for-sale. The consolidated statements of operations reported for current and prior periods report the results of operations of the discontinued operations recognized as a component of net income separate from the net loss from continuing operations. The following table presents the components in assets and liabilities associated with discontinued operations:
|  | December 31, 2023 |  |  | December 31, 2022 |
Accounts receivable, net of allowance for doubtful accounts of $0 and $62,427, respectively |  | $ | - |  |  | $ | 1,223,869 |
Total current assets from discontinued operations |  | $ | - |  |  | $ | 1,223,869 |
Accrued expenses and compensation |  | $ | - |  |  | $ | 2,643 |
Total current liabilities associated with discontinued operations |  | $ | - |  |  | $ | 2,643 |
The following table presents the major income and expense line items relate to the staffing and consulting services revenue as reported in the consolidated statements of operations for the years ended December 31, 2023, and 2022:
|  | Years Ended December 31, |
|  | 2023 |  |  | 2022 |
Revenue |  | $ | 3,576,667 |  |  | $ | 4,120,755 |
Cost of revenue |  |  | 2,502,276 |  |  |  | 2,949,587 |
Gross Profit |  |  | 1,074,391 |  |  |  | 1,171,168 |
Operating expenses: |  |  |  |  |  |  |  |
General and Administrative |  |  | - |  |  |  | 49,939 |
Total operating expenses |  |  | - |  |  |  | 49,939 |
Other Income |  |  | - |  |  |  | 28 |
Net income from discontinued operations |  | $ | 1,074,391 |  |  | $ | 1,121,257 |

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