Note 10 – Deferred Revenue
(a)
During the three months ended March 31, 2016 the Company entered into various agreements with a telephone service provider (the “Client”) for the launch of the Epoxy App at its corporate and franchise locations. Under the terms of the agreement, Epoxy would offer training to the corporate location and the term would run twelve months from the launch of the Epoxy App. As consideration the Company would receive fees from certain locations in advance, totaling $23,400. Subsequent to the execution of the agreements the Client revised its corporate focus. As a result, the Company has recorded the entire fee remitted as deferred revenue until such time as a formal unwinding of the agreement is complete. As at June 30, 2016 the amounts received remain in deferred revenue as the Company has not yet concluded the unwinding of the agreement.
(b)
On March 31, 2016 the Company entered into an agreement with a third party for the development of a customized Epoxy app pilot program and branded corporate implementation. Under the terms of the agreement Epoxy will receive a development fee of $49,000 to be paid as to $30,000 on signing of the agreement, and $19,000 upon official launch of the pilot program. Revenue under this contract will initially recorded as deferred revenue and realized upon completion of each scope of work. As at June 30, 2016 amounts received under this contract remain in deferred revenue as the pilot program is not yet complete.
