3. Interest, Advances and Promissory Notes Payable

9 Months Ended

Sep. 30, 2014

Interest Advancesand Promissory Notes Payable [Abstract]

Interest Advancesand Promissory Notes Payable

3. Interest, Advances and Promissory Notes Payable

a) Interest payable

A summary of the interest payable activity is as follows:

Balance, December 31, 2012	$	1,569,321
Interest incurred on promissory notes payable		505,571
Other		125
Balance, December 31, 2013		2,075,017
Interest incurred on judgement against Company (note 6(b))		29,583
Interest incurred on promissory notes payable		386,679
Balance, September 30, 2014 (unaudited)	$	2,491,279

Interest payable is to the following:

	September 30,		December 31,
	2014 (unaudited)		2013
Relatives of directors	$	1,276,193	$	1,046,523
Non-related parties		1,215,086		1,028,494
	$	2,491,279	$	2,075,017

Historically, all interest payable incurred is from interest incurred at the stated rate of promissory notes issued by the Company. The payment terms, security and any interest payable are based on the underlying promissory notes payable that the Company has outstanding.

b) Advances payable

A summary of the advances payable activity is as follows:

Balance, December 31, 2012	$	105,613
Advances accrued		30,000
Advances repaid from proceeds of line of credit		(20,000	)
Transfer of balance to accounts payable		(115,613	)
Balance, December 31, 2013 and September 30, 2014 (unaudited)	$	-

c) Promissory notes payable:

(Unaudited)

d) Promissory notes payable to related parties:

e) Interest expense

During the nine months ended September 30, 2014, the Company incurred interest expense of $4,335,619 (2013: $930,761) substantially as follows:

-	$416,261 (2013: $379,179) incurred on promissory notes payables as shown in note 3(c);
-	$547,249 (2013: $417,551) incurred on lines of credit payable;
-	$74,086 (note 6(b)) (2013: $131,987) incurred from the calculation of imputed interest on accounts payable outstanding for longer than one year, advances payable and promissory notes payable, which had no stated interest rate; and,
-	$3,296,342 (2013: $Nil) incurred on stock options granted to creditors.