Annual report pursuant to Section 13 and 15(d)

CONSOLIDATED STATEMENTS OF CASH FLOWS

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CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($)
 12 Months Ended
Sep. 30, 2015
Sep. 30, 2014
Cash flows from operating activities:    
Net (loss) income $ (3,554,914) $ 515,518
Adjustments to reconcile net (loss) income to net cash used in operating activities:    
Amortization of deferred financing costs 0 481,782
Provision for bad debts 409,481 267,998
Forbearance incentive expense 101,156 0
Stock based compensation 473,328 116,680
Depreciation and amortization 108,324 41,390
Gain on settlement of lease termination costs (226,544) 0
Gain on forgiveness of debt 0 (2,748,158)
Changes in operating assets and liabilities:    
Accounts receivable 279,844 (1,261,840)
Other current assets (1,257,966) (46,127)
Accounts payable and accrued liabilities 3,602,899 538,762
Net cash used in operating activities (64,392) (2,093,995)
Cash flows from investing activities:    
Purchase of property and equipment (125,573) (24,915)
Proceeds from sales of property and equipment 0 5,000
Net cash used in investing activities (125,573) (19,915)
Cash flows from financing activities:    
Advances (payments) on factor lines of credit, net (383,682) 984,236
Advances from related party 183,538 0
Proceeds from issuance of notes payable, net 0 889,436
Payments on notes payable (143,786) (349,664)
Payments on notes payable - related parties (210,302) (55,198)
Proceeds from sale of preferred stock 430,683 613,600
Proceeds from repayment of subscriptions receivable 660,000 0
Payment of deferred financing costs (140,000) 0
Net cash provided by financing activities 396,451 2,082,410
Net change in cash 206,486 (31,500)
Cash, beginning of year 1,254 32,754
Cash, end of year 207,740 1,254
Supplemental Disclosure of Cash Flow Information:    
Cash paid for interest 350,922 734,571
Cash paid for income taxes 0 0
Noncash investing and financing activities:    
Issuance of notes payable for the purchase of fixed assets 1,314,474 283,948
Issuance of notes to settle litigation 200,000 0
Unpaid subscription for preferred shares 349,789 0
Cancellation of preferred shares $ 202 $ 0