E DIGITAL CORP - FORM 10-Q - February 14, 2017

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended December 31, 2016

Commission File Number 0-20734

During the three months ended December 31, 2016 the Company determined that it had overstated accounts payable related to contingent legal fees expenses and recaptures. The Company assessed the materiality of this error on previously issued financial statements in accordance with the ASC 250, Presentation of Financial Statements, and Securities and Exchange Commission (SEC) Staff Accounting Bulletin No. 99, Materiality. The Company concluded, based on a review of the quantitative and qualitative factors of the materiality of the amount, that the error was not material to any previously issued financial statements and correction of the error in the three months ended December 31, 2016 was not material to that period’s financial statements. The Company recorded the cumulative effect of the error as of October 1, 2016 by decreasing accounts payable by $265,139. The correction of the error decreased contingent legal fees expenses and recaptures by $265,139 for the nine months ended December 31, 2016.

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