NOTES PAYABLE - RELATED PARTY	12 Months Ended
Dec. 31, 2016
Notes to Financial Statements
NOTES PAYABLE - RELATED PARTY	NOTE 8 – notes payable – related party On May 20, 2014, the Company issued a promissory note for $94,500 for cash to a shareholder of the Company that is to be repaid in full by May 20, 2015. The note accrues interest expense at 10% per annum and in accordance with the promissory note, there is a late fee of $100 per day for each day the note remains unpaid beyond the maturity date. Interest and late fee expense for the years ended December 31, 2016 and 2015 was $46,050 and $15,251, respectively. The Company recorded late fees payable of $59,000 and $22,400 and accrued interest payable of $24,131 and $14,681, as of December 31, 2016 and December 31, 2015, respectively, and is included in accounts payable and accrued expenses – related party as of December 31, 2016 and 2015. On July 14, 2014, the Company issued a promissory note for $12,500 for cash to a shareholder of the Company that is to be repaid in full by July 14, 2015. The note accrues interest expense at 10% per annum and in accordance with the promissory note, there is a late fee of $100 per day for each day the note remains unpaid beyond the maturity date. Interest and late fee expense for the year ended December 31, 2016 and 2015 was $37,850 and $1,833, respectively. The Company recorded late fees payable of $53,500 and $16,900 and accrued interest payable of $3,083 and $1,833, as of December 31, 2016 and 2015, respectively, and is included in accounts payable and accrued expenses – related party as of December 31, 2016 and 2015. On April 1, 2016, in conjunction with Agreement for Purchase and Sale of Assets (Note 4), the Company issued an unsecured non-interest bearing promissory note to Labor Smart, Inc., due on April 1, 2018 with a face amount of $755,000 and a fair value of $506,000. In accordance with FASB ASC 835-30 "Imputation of Interest", interest has been imputed on the promissory note at a market interest rate of 20% per annum. At December 31, 2016, the promissory note has been recorded net of debt discount of $163,801. Amortization of debt discount of $85,199 has been included in interest expense in the consolidated statements of loss for the year ended December 31, 2016, respectively. The debt discount is being amortized on the effective interest method.

NOTES PAYABLE - RELATED PARTY

12 Months Ended

Dec. 31, 2016

NOTE 8 – notes payable – related party

On May 20, 2014, the Company issued a promissory note for $94,500 for cash to a shareholder of the Company that is to be repaid in full by May 20, 2015. The note accrues interest expense at 10% per annum and in accordance with the promissory note, there is a late fee of $100 per day for each day the note remains unpaid beyond the maturity date. Interest and late fee expense for the years ended December 31, 2016 and 2015 was $46,050 and $15,251, respectively. The Company recorded late fees payable of $59,000 and $22,400 and accrued interest payable of $24,131 and $14,681, as of December 31, 2016 and December 31, 2015, respectively, and is included in accounts payable and accrued expenses – related party as of December 31, 2016 and 2015.

On July 14, 2014, the Company issued a promissory note for $12,500 for cash to a shareholder of the Company that is to be repaid in full by July 14, 2015. The note accrues interest expense at 10% per annum and in accordance with the promissory note, there is a late fee of $100 per day for each day the note remains unpaid beyond the maturity date. Interest and late fee expense for the year ended December 31, 2016 and 2015 was $37,850 and $1,833, respectively. The Company recorded late fees payable of $53,500 and $16,900 and accrued interest payable of $3,083 and $1,833, as of December 31, 2016 and 2015, respectively, and is included in accounts payable and accrued expenses – related party as of December 31, 2016 and 2015.

On April 1, 2016, in conjunction with Agreement for Purchase and Sale of Assets (Note 4), the Company issued an unsecured non-interest bearing promissory note to Labor Smart, Inc., due on April 1, 2018 with a face amount of $755,000 and a fair value of $506,000. In accordance with FASB ASC 835-30 "Imputation of Interest", interest has been imputed on the promissory note at a market interest rate of 20% per annum. At December 31, 2016, the promissory note has been recorded net of debt discount of $163,801. Amortization of debt discount of $85,199 has been included in interest expense in the consolidated statements of loss for the year ended December 31, 2016, respectively. The debt discount is being amortized on the effective interest method.

Staffing Group, Ltd. 10-K