Quarterly report pursuant to Section 13 or 15(d)

CONSOLIDATED STATEMENTS OF CASH FLOWS

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CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($)
 3 Months Ended
Mar. 31, 2016
Mar. 31, 2015
Cash flows from operating activities:    
Net Loss $ (838,381) $ (752,424)
Adjustments to reconcile net loss to net cash used in operating activities:    
Depreciation and amortization $ 12,099 12,596
Gain on settlement of accounts payable $ 3,200
Stock and warrants issued for services $ 95,036
Loss on conversion of notes payable included in interest expense $ 352,093
Amortization of stock based prepaid consulting fees $ 198,068
Loss related to warrants exchanged for stock 630
Changes in assets and liabilities:    
Accounts receivable 314,797 $ (580,739)
Costs and estimated earnings on uncompleted contracts (13,175) (74,617)
Prepaid expenses and other current assets (45,336) (67,017)
Accounts payable 118,522 333,672
Accounts payable-related party $ 11,135 (9,269)
Interest from premium accretion on convertible notes 10,384
Payroll taxes payable $ 160,153 (34,520)
Accrued expenses 77,114 54,322
Billings in excess of costs and earnings on uncompleted contracts 116,984 714,042
Deferred revenue (298,890) (256,538)
Net Cash Used in Operating Activities (91,245) (294,815)
Cash flows from investing activities:    
Purchase of patents/trademarks (70) (1,600)
Purchase of fixed assets (19,029) (1,897)
Net Cash Used In Investing Activities (19,099) (3,497)
Cash flows from financing activities:    
Bank overdraft 3,604 13,534
Proceeds from related party notes 50,000 $ 118,500
Repayments of related party notes (41,178)
Proceeds (repayments) of insurance and equipment financing (34,461) $ 10,000
Proceeds (repayments) of notes payable (7,500) 71,093
Net cash (used in) provided by financing activities (29,535) 213,127
Net decrease in cash (139,879) (85,185)
Cash, beginning of period 140,129 85,435
Cash, end of period 250 250
Supplemental Disclosure of Cash Flow Information:    
Interest paid $ 5,969 22,129
Taxes paid 800
Supplemental Non-Cash Investing and Financing Activities:    
Stock issued to convert convertible notes and accrued interest $ 1,415,546
Common stock issued for prepaid consulting services $ 273,600
Common stock issued to settle accounts payable $ 16,800
Write-off balance of put premium liability related to convertible notes $ 37,120
Note issued for financing of insurance premiums $ 123,580