Annual report pursuant to Section 13 and 15(d)

SEGMENT REPORTING

v3.10.0.1
SEGMENT REPORTING
 12 Months Ended
Aug. 31, 2018
SEGMENT REPORTING [Abstract]  
SEGMENT REPORTING
NOTE 13 – SEGMENT REPORTING

An operating segment is defined as a component of an enterprise for which discrete financial information is available and is reviewed regularly by the Chief Operating Decision Maker (“CODM”), or decision-making group, to evaluate performance and make operating decisions. The Company has identified its CODM as the Chief Executive Officer.

During the year 2018, the Company began construction of lots at Sky Ranch, which the Company has identified as a segment. Currently, the Company operates its wholesale water and wastewater services segment and land development activities at Sky Ranch as its two lines of business.

The wholesale water and wastewater services business includes selling water service to customers, which water is provided by the Company using water rights owned or controlled by the Company, and developing infrastructure to divert, treat and distribute that water and collect, treat and reuse wastewater.

As part of the Company’s land development activities at Sky Ranch, the Company entered into contracts for the sale of lots (see Note 2 – Summary of Significant Accounting Policies). The Company has identified land development and lot sales as a separate segment beginning in the fiscal year 2018.

Oil and gas royalties and licenses are a passive activity and not an operating business activity and, therefore, are not classified as a segment.

The following table summarizes wholesale water and wastewater services and land development revenue information by segment:

   
For the Fiscal Years Ended August 31,
  
   
2018
    
2017
    
2016
  
Wholesale water and wastewater services
  
$
4,794,749
    
$
1,227,787
    
$
452,161
  
Total wholesale water and wastewater services revenues
    
4,794,749
      
1,227,787
      
452,161
  
                         
Land development activities
    
2,164,450
      
—
      
—
  
Total land development activities revenues
    
2,164,450
      
—
      
—
  
                         
Total revenues
  
$
6,959,199
    
$
1,227,787
    
$
452,161
  

The following table summarizes wholesale water and wastewater services and land development pretax income by segment:

   
For the Fiscal Years Ended August 31,
  
   
2018
    
2017
    
2016
  
Wholesale water and wastewater services
  
$
2,646,988
    
$
424,481
    
$
(76,598
)
Depreciation, general and administrative expenses, and other income
    
(1,375,338
)
    
(2,103,324
)
    
(1,153,661
)
Total wholesale water and wastewater services pretax income (loss)
    
1,271,650
      
(1,678,843
)
    
(1,230,259
)
                         
Land development activities
    
150,610
      
—
      
—
  
Depreciation, general and administrative expenses, and other income
    
(1,289,580
)
                
Total land development activities pretax loss
    
(1,138,970
)
    
—
      
—
  
                         
Total income (loss) from continuing operations
  
$
132,680
    
$
(1,678,843
)
  
$
(1,230,259
)

The following table summarizes total assets for the Company’s wholesale water and wastewater services business and land development business by segment.  The assets consist of water rights and water and wastewater systems in the Company’s wholesale water and wastewater services segment. The assets consist of land, inventories and deposits in the Company’s land development segment.  The Company’s other assets primarily consist of cash and cash equivalents, equipment, mineral rights, related party notes receivables and a deferred tax asset.

   
August 31, 2018
    
August 31, 2017
  
Wholesale water and wastewater services
  
$
36,721,884
    
$
34,575,713
  
Other water and wastewater
    
25,687,625
      
35,211,859
  
Total wholesale water and wastewater services assets
    
62,409,509
      
69,787,572
  
                 
Land development activities
    
9,497,106
      
—
  
Other land development
    
—
      
—
  
Total land development activities assets
    
9,497,106
      
—
  
                 
Total assets
  
$
71,906,615
    
$
69,787,572
  

For the years ended August 31, 2018 and 2017, the Company had asset additions of $2.9 million and $6.9 million, respectively, in the wholesale water and wastewater services segment.

For the years ended August 31, 2018 and 2017, the Company had asset additions of $4.7 million and $0.9 million, respectively, in the land development activities segment. The Company allocated $4.8 million from other water and wastewater to its land development activities segment in fiscal 2018.