As Of               Filer                 Filing    For·On·As Docs:Size             Issuer                      Filing Agent

11/29/19  Lingo Media Corp                  6-K         9/30/19   65:4.4M                                   RDG Filings/FA

Document/Exhibit                   Description                      Pages   Size 

 1: 6-K         Report by a Foreign Issuer                          HTML    352K 
 2: EX-1        Underwriting Agreement                              HTML    176K 
 3: EX-99.1     Miscellaneous Exhibit                               HTML     23K 
 4: EX-99.2     Miscellaneous Exhibit                               HTML     23K 
32: R1          Document And Entity Information                     HTML     34K 
51: R2          Condensed Consolidated Interim Balance Sheets       HTML     80K 
                (Current Period Unaudited)                                       
42: R3          Condensed Consolidated Interim Statements of        HTML     88K 
                Comprehensive Income (Loss) (Unaudited)                          
13: R4          Condensed Consolidated Interim Statements of        HTML     46K 
                Changes in Equity (Unaudited)                                    
33: R5          Condensed Consolidated Interim Statements of Cash   HTML     79K 
                Flows (Unaudited)                                                
52: R6          Note 1 - Corporate Information                      HTML     26K 
43: R7          Note 2 - Basis of Preparation                       HTML     33K 
14: R8          Note 3 - Significant Accounting Judgements,         HTML     29K 
                Estimates and Assumptions                                        
31: R9          Note 4 - Summary of Significant Accounting          HTML     71K 
                Policies                                                         
27: R10         Note 5 - Accounts and Grants Receivable             HTML     29K 
20: R11         Note 6 - Property and Equipment                     HTML     48K 
37: R12         Note 7 - Right-of-use Asset                         HTML     62K 
60: R13         Note 8 - Contract Liability                         HTML     33K 
28: R14         Note 9 - Share Capital                              HTML     23K 
21: R15         Note 10 - Share-based Payments                      HTML     67K 
38: R16         Note 11 - Income Tax                                HTML     22K 
61: R17         Note 12 - Government Grants                         HTML     25K 
26: R18         Note 13 - Financial Instruments                     HTML     38K 
22: R19         Note 14 - Major Customer                            HTML     24K 
44: R20         Note 15 - Capital Management                        HTML     25K 
54: R21         Note 16 - Segmented Information                     HTML     94K 
29: R22         Note 17 - Supplemental Cash Flow Information        HTML     26K 
11: R23         Note 18 - Related Party Balances and Transactions   HTML     26K 
45: R24         Significant Accounting Policies (Policies)          HTML     69K 
55: R25         Note 4 - Summary of Significant Accounting          HTML     61K 
                Policies (Tables)                                                
30: R26         Note 5 - Accounts and Grants Receivable (Tables)    HTML     27K 
12: R27         Note 6 - Property and Equipment (Tables)            HTML     47K 
46: R28         Note 7 - Right-of-use Asset (Tables)                HTML     61K 
53: R29         Note 8 - Contract Liability (Tables)                HTML     31K 
64: R30         Note 10 - Share-based Payments (Tables)             HTML     52K 
41: R31         Note 13 - Financial Instruments (Tables)            HTML     25K 
19: R32         Note 16 - Segmented Information (Tables)            HTML     90K 
25: R33         Note 17 - Supplemental Cash Flow Information        HTML     25K 
                (Tables)                                                         
63: R34         Note 1 - Corporate Information (Details Textual)    HTML     21K 
40: R35         Note 4 - Summary of Significant Accounting          HTML     28K 
                Policies (Details Textual)                                       
18: R36         Note 4 - Summary of Significant Accounting          HTML     90K 
                Policies - Impacts of Adopting IFRS 16 (Details)                 
24: R37         Note 5 - Accounts and Grants Receivable - Schedule  HTML     26K 
                of Receivables (Details)                                         
65: R38         Note 6 - Property and Equipment - Schedule of       HTML     41K 
                Property and Equipment (Details)                                 
39: R39         Note 7 - Right-of-use Asset - Schedule of           HTML     45K 
                Right-of-use Asset (Details)                                     
57: R40         Note 8 - Contract Liability - Changes in Contract   HTML     31K 
                Liability (Details)                                              
50: R41         Note 9 - Share Capital (Details Textual)            HTML     24K 
16: R42         Note 10 - Share-based Payments (Details Textual)    HTML     78K 
35: R43         Note 10 - Share-based Payments - Options            HTML     52K 
                Outstanding (Details)                                            
56: R44         Note 12 - Government Grants (Details Textual)       HTML     31K 
49: R45         Note 13 - Financial Instruments (Details Textual)   HTML     42K 
15: R46         Note 13 - Financial Instruments - Denominated       HTML     38K 
                Monetary Assets and Liabilities (Details)                        
34: R47         Note 14 - Major Customer (Details Textual)          HTML     24K 
58: R48         Note 16 - Segmented Information (Details Textual)   HTML     21K 
48: R49         Note 16 - Segmented Information - Segment Earnings  HTML     83K 
                (Details)                                                        
36: R50         Note 16 - Segmented Information - Geographical      HTML     39K 
                Information (Details)                                            
59: R51         Note 17 - Supplemental Cash Flow Information -      HTML     23K 
                Schedule of Income Taxes and Interest Paid                       
                (Details)                                                        
23: R52         Note 18 - Related Party Balances and Transactions   HTML     31K 
                (Details Textual)                                                
47: XML         IDEA XML File -- Filing Summary                      XML    118K 
17: EXCEL       IDEA Workbook of Financial Reports                  XLSX     53K 
 5: EX-101.INS  XBRL Instance -- lmdc-20190930                       XML   1.27M 
 7: EX-101.CAL  XBRL Calculations -- lmdc-20190930_cal               XML     83K 
 8: EX-101.DEF  XBRL Definitions -- lmdc-20190930_def                XML    726K 
 9: EX-101.LAB  XBRL Labels -- lmdc-20190930_lab                     XML    596K 
10: EX-101.PRE  XBRL Presentations -- lmdc-20190930_pre              XML    755K 
 6: EX-101.SCH  XBRL Schema -- lmdc-20190930                         XSD    147K 
62: ZIP         XBRL Zipped Folder -- 0001437749-19-023700-xbrl      Zip     96K 

 

 

		Notes				September 30, 2019				December 31, 2018
ASSETS
Current Assets
Cash						$	30,367.			$	233,843
Accounts and grants receivable			5				1,001,936				913,458
Prepaid and other receivables							94,609				101,539
							1,126,912				1,248,840
Non-Current Assets
Property and equipment			6				26,692				53,164
Right-of-use assets			7				320,454				-
TOTAL ASSETS						$	1,474,058			$	1,302,004
EQUITY AND LIABILITIES
Current Liabilities
Accounts payable			18			$	199,931			$	312,034
Accrued liabilities			18				361,593				167,558
Contract liability			8				176,427				217,259
Lease inducement							37,849				46,559
							775,800				743,410
Non-Current Liabilities
Lease obligation			4				289,825				-
TOTAL LIABILITIES						$	1,065,625			$	743,410
Equity
Share capital			9			$	21,914,722			$	21,914,722
Share-based payment reserve			10				4,036,282				3,955,167
Accumulated other comprehensive income							(276,468	)			(271,245	)
Deficit							(25,266,103	)			(25,040,050	)
TOTAL EQUITY						$	408,434			$	558,594
TOTAL EQUITY AND LIABILITIES						$	1,474,058			$	1,302,004

 

		Notes				For the three months ended September 30								For the nine months ended September 30
						2019				2018				2019				2018
Revenue						$	117,545			$	186,518			$	1,124,714			$	1,227,032
Expenses
Selling, general and administrative expenses							219,617				303,739				650,534				928,363
Bad debt (recovery)							-				(150,340	)			-				(293,379	)
Direct costs							45,609				73,979				120,031				167,185
Development costs							45,627				69,864				150,320				407,300
Share-based payment							24,356				14,468				81,115				87,539
Depreciation – right-of-use asset			7				45,855				-				137,568				-
Depreciation – property and equipment			6				1,379				1,544				4,602				4,761
Total Expenses							382,443				313,254				1,144,170				1,301,769
Profit / (Loss) from Operations							(264,898	)			(126,736	)			(19,456	)			(74,737	)
Net Finance Charges
Interest expense							10,371				4,108				34,918				43,032
Foreign exchange (gain) / loss							21,415				14,968				28,739				(48,988	)
Profit / (Loss) before Tax							(296,684	)			(145,812	)			(83,113	)			(68,781	)
Income and Other Tax Expense							45,498				10,738				142,940				154,654
Net Profit / (Loss) for the Period							(342,182	)			(156,550	)			(226,053	)			(223,435	)
Other Comprehensive Income
Exchange differences on translating foreign operations gain / (loss)							21,663				(4,215	)			(5,223	)			(3,579	)
Total Comprehensive Income / (Loss), Net of Tax						$	(320,519	)		$	(160,765	)		$	(231,276	)		$	(227,014	)
Earnings /(Loss) per Share
Basic & Diluted						$	(0.01	)		$	(0.00	)		$	(0.01	)		$	(0.01	)
Weighted Average Number of Common Shares Outstanding
Basic & Diluted							35,529,132				35,529,132				35,529,132				35,529,132

 

		Issued Share Capital								Share- Based				Accumulated Other Comprehensive								Total
		No. of Shares				Amount				Reserves				Income				Deficit				Equity
Balance as at January 1, 2018			35,529,192			$	21,914,722			$	3,792,678			$	(303,447	)		$	(24,850,199	)			553,754
Loss for the period			-				-				-				-				(223,435	)			(223,435	)
Other comprehensive loss			-				-				-				(3,579	)			-				(3,579	)
Share based payments charged to operations			-				-				87,539				-				-				87,539
Balance as at September 30, 2018			35,529,192			$	21,914,722			$	3,880,217			$	(307,026	)		$	(25,073,634	)		$	414,279
Contract adjustment for 2017																			(85,695	)			(85,695	)
Loss for the period			-				-				-				-				119,279				119,279
Other comprehensive income			-				-				-				35,781				-				35,781
Share-based payments charged to operations			-				-				74,950				-				-				74,950
Balance as at December 31, 2018			35,529,192			$	21,914,722			$	3,955,167			$	(271,245	)		$	(25,040,050	)		$	558,594
Loss for the period			-				-				-				-				(226,053	)			(226,053	)
Other comprehensive loss			-				-				-				(5,223	)			-				(5,223	)
Share-based payments charged to operations			-				-				81,115				-				-				81,115
Balance as at September 30, 2019			35,529,192			$	21,914,722			$	4,036,282			$	(276,468	)		$	(25,266,103	)		$	408,434

 

		For the three months ended September 30								For the nine months ended September 30
		2019				2018				2019				2018
CASH FLOWS FROM OPERATING ACTIVITIES
Loss for the period		$	(342,182	)		$	(156,550	)		$	(226,053	)		$	(223,435	)
Adjustments to Net Loss for Non-Cash Items:
Share-based payment			24,356				14,468				81,115				87,539
Unrealized foreign exchange (gain)/loss			22,389				1,570				(4,469	)			(3,606	)
Depreciation			47,234				1,544				142,170				4,761
Lease inducement			(2,903	)			(8,651	)			(8,710	)			(8,651	)
Operating Loss before Working Capital Changes			(251,106	)			(147,619	)			(15,947	)			(143,392	)
Working Capital Adjustments:
(Increase)/decrease in accounts and grants receivable			47,497				(43,451	)			(88,478	)			(146,827	)
(Increase)/decrease in prepaid and other receivables			5,841				(32,336	)			6,930				88,578
Increase/(decrease) in accounts payable			(18,925	)			55,731				(112,104	)			115,545
Increase/(decrease) in accrued liabilities			103,586				52,640				194,035				(11,610	)
Increase/(decrease) in contract liability			1,213				-				(40,832	)			-
Cash Used in Operations			(111,894	)			(115,035	)			(56,396	)			(97,706	)
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of property and equipment			-				(6,039	)			(450	)			(6,039	)
Net Cash Flows Used in Investing Activities			-				(6,039	)			(450	)			(6,039	)
CASH FLOWS FROM FINANCING ACTIVITIES
Increase/(decrease) in lease obligation			(49,029	)			-				(146,630	)			-
Proceeds from loans			58,000				-				449,612				420,000
Repayment of loans payable			(58,000	)			-				(449,612	)			(525,000	)
Net Cash Flows Used in Financing Activities			(49,029	)			-				(146,630	)			(105,000	)
NET DECREASE IN CASH AND CASH EQUIVALENTS			(160,923	)			(121,074	)			(203,476	)			(208,745	)
Cash and Cash Equivalents at the Beginning of the Period			191,290				239,763				233,843				327,434
Cash and Cash Equivalents at the End of the Period		$	30,367			$	118,689			$	30,367			$	118,689

 

1.	CORPORATE INFORMATION

 

Lingo Media Corporation (“Lingo Media” or the “Company”) is a publicly listed company incorporated in Canada with limited liability under the legislation of the Province of Ontario and its shares are listed on the TSX Venture Exchange and inter-listed on the OTC Marketplace. The consolidated financial statements of the Company as at and for the period ended September 30, 2019 comprise the Company and its wholly owned subsidiaries: Lingo Learning Inc., ELL Technologies Ltd., ELL Technologies Limited, Vizualize Technologies Corporation, Speak2Me Inc., Parlo Corporation and Lingo Group Limited (the “Group”).

 

Lingo Media is an EdTech company that is ‘Changing the way the world learns English’. The Group provides online and print-based solutions through its two distinct business units: ELL Technologies Ltd. (“ELL Technologies”) and Lingo Learning Inc. (“Lingo Learning”). ELL Technologies is a global English language learning multi-media and online training company. Lingo Learning is a print-based publisher of English language learning school programs in China.

 

The head office, principal address and registered and records office of the Company is located at 151 Bloor Street West, Suite 703, Toronto, Ontario, Canada, M5S 1S4.

 

 

 

2.	BASIS OF PREPARATION

 

2.1

Statement of compliance

 

These condensed consolidated interim financial statements are unaudited and have been prepared in accordance with IAS 34 ‘Interim Financial Reporting’ (“IAS 34”) using accounting policies consistent with the International Financial Reporting Standards (“IFRS”) issued by the International Accounting Standards Board (“IASB”) and Interpretations of the International Financial Reporting Interpretations Committee (“IFRIC”).

 

These condensed consolidated interim financial statements have been prepared on a going concern basis, which contemplates the realization of assets and settlement of liabilities in the normal course of business. The Company has incurred significant losses recurring over the years. This raises the doubt about the Company’s ability to continue as a going concern. The ability of the Company to continue as a going concern is dependent upon raising additional financing through share issuance or debt borrowing or through cash flow generated from sales contracts and distribution agreements. There are no assurances that the Company will be successful in achieving these goals.

 

The condensed consolidated interim financial statements for the period ended September 30, 2019 were approved and authorized by the Board of Directors on November 29, 2019.

 

2.2

Basis of measurement

 

These condensed consolidated interim financial statements have been prepared on the historical cost basis except as provided in note 4. The comparative figures presented in these consolidated financial statements are in accordance with the same accounting policies.

 

2.3

Basis of consolidation

 

The consolidated financial statements comprise the financial statements of the Company and its wholly owned subsidiaries controlled by the Company (the “Group”) as at September 30, 2018. Control exists when the Company is exposed to, or has the rights to variable returns from its involvement with the entity and has the ability to affect these returns through its power over the entity.

 

 

LINGO MEDIA CORPORATION

Notes to Condensed Consolidated Interim Financial Statements

For the period ended September 30, 2019

(Unaudited - See Notice to Reader)

---

 

2.	BASIS OF PREPRATION (Cont’d)

 

2.3

Basis of consolidation (Cont’d)

 

Subsidiaries are fully consolidated from the date of acquisition, being the date on which the Group obtains control, and continue to be consolidated until the date when such control ceases. The financial statements of the subsidiaries are prepared for the same reporting period as the parent company, using consistent accounting policies. All inter-group balances, transactions, unrealized gains and losses resulting from inter-group transactions and dividends are eliminated in full.

 

2.4

Functional and presentation currency

 

The functional currency is the currency of the primary economic environment in which the entity operates and has been determined for each entity within the Group. These consolidated financial statements are presented in Canadian Dollars, which is the Company’s functional currency. The functional currency of ELL Technologies Limited and Lingo Group Limited are United States Dollar (“USD”). All other subsidiaries’ functional currency is Canadian Dollar (“CAD”).

 

The functional currency determinations were conducted through an analysis of the consideration factors identified in IAS 21, “The Effects of Changes in Foreign Exchange Rates”.

 

 

 

3.	SIGINIFICANT ACCOUTING JUDGEMENTS, ESTIMATES AND ASSUMPTIONS

 

The preparation of the Company’s condensed consolidated interim financial statements in conformity with IFRS requires management to make judgments, estimates and assumptions that affect the application of accounting policies, reported amounts of assets, liabilities and contingent liabilities, revenues and expenses at the date of the consolidated financial statements and during the reporting period.

 

Estimates and assumptions are continuously evaluated and are based on management’s historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. However, actual outcomes can differ from these estimates. Revisions to accounting estimates are recognized in the period in which the estimate is revised if the revision affects only that period or in the period of the revision and further periods if the review affects both current and future periods.

 

Information about critical judgements in applying accounting policies that have the most significant effect on the amounts recognized in the consolidated financial statements is included in the following notes:

 

●

Determination of functional currency

 

●

Determination of expected credit loss

 

●

Recognition of internally developed intangibles

 

●

Recognition of government grant and grant receivable

 

●

Recognition of deferred tax assets

 

●

Valuation of share-based payments

 

 

 

4.	SUMMARY OF SIGINFICANT ACCOUTING POLICIES

 

The accounting policies applied by the Company in these Condensed Consolidated Interim Financial Statements are the same as those applied by the Company in its Consolidated Financial Statements for the year ended December 31, 2018, except the following:

 

 

LINGO MEDIA CORPORATION

Notes to Condensed Consolidated Interim Financial Statements

For the period ended September 30, 2019

(Unaudited - See Notice to Reader)

---

 

4.	SUMMARY OF SIGINFICANT ACCOUTING POLICIES (Cont’d)

 

New Standards Adopted in Current Year

 

IFRS 16 ‘Leases” was issued by the IASB in January 2016 and applies to annual reporting periods beginning on or after January 1, 2019. IFRS 16 establishes principles for the recognition, measurement, presentation and disclosure of leases, with the objective of ensuring that lessees and lessors provide relevant information that faithfully represents those transactions. The new standard brings most leases on-balance sheet for lessees under a single model, eliminating the distinction between operating and finance leases. Lessor accounting however, remains largely unchanged and the distinction between operating and finance leases is retained. Under IFRS 16, a lessee recognizes a right-of-use asset and a lease liability. The right-of-use asset is treated similarly to other non-financial assets and depreciated accordingly and the liability accrues interest. This will typically produce a front-loaded expense profile (whereas operating leases under IAS 17 would typically have had straight-line expenses) as an assumed linear depreciation of the right-of-use asset and the decreasing interest on the liability will lead to an overall decrease of expense over the reporting period.

 

The lease liability is initially measured at the present value of the lease payments payable over the lease term, discounted at the rate implicit in the lease if that can be readily determined. The use their incremental borrowing rate. As with IFRS 16’s predecessor, IAS 17, lessors classify leases as operating or finance in nature. A lease is classified as a finance lease if it transfers substantially all the risks and rewards incidental to ownership of an underlying asset. Otherwise a lease is classified as an operating lease.

 

The Company has elected to apply the retrospective method by setting right-of-use assets based on the lease liability at the date of initial application, adjusted by the amount of lease payments.

 

The following table summarize the impacts of adopting IFRS 16 on the consolidated balance sheet as September 30, 2019 and the statement of comprehensive income (loss) for the period then ended for each of the line items affected. There was no material impact on the consolidated statement of cash flows for the period ended September 30, 2019.

 

 

 

LINGO MEDIA CORPORATION

Notes to Condensed Consolidated Interim Financial Statements

For the period ended September 30, 2019

(Unaudited - See Notice to Reader)

---

 

4.	SUMMARY OF SIGINFICANT ACCOUTING POLICIES (Cont’d)

 

Impact on the consolidated statement of comprehensive income (loss)

 

 

On transition to IFRS 16, the Company recognized a right of use asset and lease liability of $289,825. The recognition of the right of use asset is considered non-cash items within the statement of cash flows. When measuring operating lease commitments, the Company used a weighted average rate of 3.75%.

 

 

 

 

5.	ACCOUNTS AND GRANTS RECEIVABLE

 

Accounts and grants receivable consist of: