Summary of Significant Accounting Policies	12 Months Ended
Feb. 29, 2012
Accounting Policies
Significant Accounting Policies	NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES *Revenue Recognition* The Company recognizes revenue from product sales when the risks and rewards of ownership have transferred to the customer. Transfer of risks and rewards is considered to have occurred upon shipment of the finished product to retailers. Sales incentives, promotional allowances and returns are estimated and recognized as a reduction from revenue at the date of shipment based upon current agreements with customers and, as the Company develops more revenues, historical activity will also be utilized. The Company evaluates these estimates on a quarterly basis and revises them as necessary. The allowance for sales incentives, promotional allowances and returns reflects our historical experience and is reviewed regularly to ensure that it reflects potential chargebacks from customers. The allowance as of February 29, 2012 is based upon our experience through February since we have recently completed additional shipments to retailers. We review the need for a return provision at least quarterly and adjust the reserve amounts if actual chargebacks differ materially from our reserve percentage once established. Inventory Inventory consists principally of deposits to the contract manufacturer of the THERA MAX® products and bottles and spray tops purchased from a third party supplier and delivered to the Company’s contract manufacturer to be used in the final packaging of the products for distribution or completed inventory, which may be subject to the security interests of our lender. Inventory is carried at the lower of cost or market on a first in, first out basis. License Agreement The Company recorded as an intangible asset the cost of the license agreement entered into with Nasal Therapeutics, Inc. based on the consideration paid. The intangible asset is amortized on a straight-line basis over the 25 year life of the agreement. The amortization charge is included in cost of sales, and, as a result of the initiation of sales during the third quarter of 2010 prior period amortization expense has been reclassified to cost of sales for the applicable periods. The Company evaluates for impairment when events and circumstances warrant in accordance with FASB ASC Topic 350-30, and an impairment loss will be recognized if the carrying amount of an intangible asset is not recoverable and its carrying amount exceeds its fair value. After an impairment loss is recognized, the adjusted carrying amount of the intangible asset will be its new accounting basis. Goodwill The Company recorded goodwill as the excess of the consideration paid over the estimated fair values of the assets acquired and liabilities assumed in a business combination. The goodwill is not amortized, but is subject to an annual impairment test in accordance with FASB ASC Topic 350-20. The two step test first determines whether the carrying amount of the reporting unit exceeds the fair value of the reporting unit. If so, the next step is to measure the impairment loss as the difference between the implied fair value of the good will and the carrying amount of the reporting unit. Fair Value of Financial Instruments The carrying amounts reported in the accompanying balance sheets of all financial instruments approximate their fair values because of the immediate or short-term maturity of these financial instruments or comparable interest rates of similar instruments. The Company follows newly issued accounting guidance relating to fair value measurements. This guidance establishes a framework for measuring fair value and expands disclosures about fair value measurements. This guidance establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three levels as follows: Level 1 -- quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company has the ability to access as of the measurement date. Level 2 -- inputs other than quoted prices included within Level 1 that are directly observable for the asset or liability or indirectly observable through corroboration with observable market data. Level 3 -- unobservable inputs for the asset or liability only used when there is little, if any, market activity for the asset or liability at the measurement date. The asset or liability’s fair value measurement level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair measurement. Valuation techniques used need to maximize the use of observable inputs and minimize the unobservable inputs. Accounting Estimates The preparation of these unaudited financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of these unaudited financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. The company’s significant estimates include those related to stock compensation and awards, and accruals for estimated administrative fees and rebate liabilities. Basic and Diluted Net Loss per Common Share (“EPS”) Basic net (loss) per share is computed by dividing the net (loss) attributable to the common stockholders by the weighted average number of common shares outstanding during the reporting period. Diluted net income per common share includes the potential dilution that could occur upon exercise of the options and warrants to acquire common stock computed using the treasury stock method which assumes that the increase in the number of shares is reduced by the number of shares which could have been repurchased by the Company with the proceeds from the exercise of the options and warrants (which were assumed to have been made at the average market price of the common shares during the reporting period). Stock-Based Compensation Compensation costs attributable to stock options, restricted stock or similar equity instruments granted are measured at the fair value at the grant date, and expensed over the expected vesting period. Cash and Cash Equivalents For purposes of the balance sheet and statement of cash flows, the Company considers all amounts on deposit with financial institutions and highly liquid investments with maturities of 90 days or less to be cash equivalents. Foreign Currency Translation The Company’s functional and reporting currency is the United States dollar. Monetary assets and liabilities denominated in foreign currencies are translated in accordance with ASC 830 Foreign Currency Matters, using the exchange rate prevailing at the balance sheet date. Gains and losses arising on settlement of foreign currency denominated transactions or balances are included in the determination of income. Foreign currency transactions are primarily undertaken in Canadian dollars. During the year ended February 29, 2012, the Company incurred no foreign currency losses. The Company has not, to the date of these financial statements, entered into derivative instruments to offset the impact of foreign currency fluctuations. Comprehensive Income (Loss) Comprehensive Income (loss) reflects changes in equity that results from transactions and economic events from non-owner sources. At February 29, 2012 and February 28, 2011, the Company had no items that represented of comprehensive income (loss) and, therefore, has not included a schedule of comprehensive income (loss) in these unaudited financial statements. Asset Retirement Obligations Topic ASC 410 addresses financial accounting and reporting for obligations associated with the retirement of tangible long-lived assets and the associated asset retirement costs. Specifically, ASC 410 requires that the fair value of a liability for an asset retirement obligation be recognized in the period in which it is incurred if a reasonable estimate of fair value can be made. In addition, the asset retirement cost is capitalized as part of the asset’s carrying value and subsequently allocated to expense over the asset’s useful life. At February 29, 2012 and February 28, 2011, the Company did not have any asset retirement obligations. Financial Instruments *Foreign Exchange Risk* The Company may be subject to foreign exchange risk for transactions denominated in foreign currencies. Foreign currency risk arises from the fluctuation of foreign exchange rates and the degree of volatility of these rates relative to the United States dollar. The Company does not believe that it has any material risk due to foreign currency exchange. *Fair Value of Financial Instruments* The Company’s financial instruments include cash, accounts payable, accrued administrative fees and accrued professional fees. The fair value of these financial instruments approximate their carrying values due to their short maturities. *Concentration of Credit Risk* Financial instruments that potentially subject the Company to significant concentrations of credit risk consist principally of cash deposits. At February 29, 2012 and February 28, 2011, any cash held by the Company was held in fully insured accounts in institutions insured by the Federal Deposit Insurance Corporation. As part of its cash management process, the Company performs periodic evaluations of the relative credit standing of its financial institution. The Company has not experienced any losses in cash balances and does not believe it is exposed to any significant credit risk on its cash. Recent Accounting Pronouncements: ASU 2011-5, Statement of Comprehensive Income will be effective for the next reporting period, but the guidance which requires companies to present net income and comprehensive income in one continuous statement or two consecutive statements should have no impact on the Company’s financial statements. The Company has reviewed all recently issued, but not yet effective, accounting pronouncements and does not believe the future adoption of any such pronouncements may be expected to cause a material impact on its financial condition or the results of its operations.

Summary of Significant Accounting Policies

12 Months Ended

Feb. 29, 2012

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Revenue Recognition

The Company recognizes revenue from product sales when the risks and rewards of ownership have transferred to the customer. Transfer of risks and rewards is considered to have occurred upon shipment of the finished product to retailers. Sales incentives, promotional allowances and returns are estimated and recognized as a reduction from revenue at the date of shipment based upon current agreements with customers and, as the Company develops more revenues, historical activity will also be utilized. The Company evaluates these estimates on a quarterly basis and revises them as necessary.

The allowance for sales incentives, promotional allowances and returns reflects our historical experience and is reviewed regularly to ensure that it reflects potential chargebacks from customers. The allowance as of February 29, 2012 is based upon our experience through February since we have recently completed additional shipments to retailers. We review the need for a return provision at least quarterly and adjust the reserve amounts if actual chargebacks differ materially from our reserve percentage once established.

Inventory

Inventory consists principally of deposits to the contract manufacturer of the THERA MAX® products and bottles and spray tops purchased from a third party supplier and delivered to the Company’s contract manufacturer to be used in the final packaging of the products for distribution or completed inventory, which may be subject to the security interests of our lender. Inventory is carried at the lower of cost or market on a first in, first out basis.

License Agreement

The Company recorded as an intangible asset the cost of the license agreement entered into with Nasal Therapeutics, Inc. based on the consideration paid. The intangible asset is amortized on a straight-line basis over the 25 year life of the agreement. The amortization charge is included in cost of sales, and, as a result of the initiation of sales during the third quarter of 2010 prior period amortization expense has been reclassified to cost of sales for the applicable periods. The Company evaluates for impairment when events and circumstances warrant in accordance with FASB ASC Topic 350-30, and an impairment loss will be recognized if the carrying amount of an intangible asset is not recoverable and its carrying amount exceeds its fair value. After an impairment loss is recognized, the adjusted carrying amount of the intangible asset will be its new accounting basis.

Goodwill

The Company recorded goodwill as the excess of the consideration paid over the estimated fair values of the assets acquired and liabilities assumed in a business combination. The goodwill is not amortized, but is subject to an annual impairment test in accordance with FASB ASC Topic 350-20. The two step test first determines whether the carrying amount of the reporting unit exceeds the fair value of the reporting unit. If so, the next step is to measure the impairment loss as the difference between the implied fair value of the good will and the carrying amount of the reporting unit.

Fair Value of Financial Instruments

The carrying amounts reported in the accompanying balance sheets of all financial instruments approximate their fair values because of the immediate or short-term maturity of these financial instruments or comparable interest rates of similar instruments. The Company follows newly issued accounting guidance relating to fair value measurements. This guidance establishes a framework for measuring fair value and expands disclosures about fair value measurements. This guidance establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three levels as follows:

Level 1 -- quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company has the ability to access as of the measurement date.

Level 2 -- inputs other than quoted prices included within Level 1 that are directly observable for the asset or liability or indirectly observable through corroboration with observable market data.

Level 3 -- unobservable inputs for the asset or liability only used when there is little, if any, market activity for the asset or liability at the measurement date.

The asset or liability’s fair value measurement level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair measurement. Valuation techniques used need to maximize the use of observable inputs and minimize the unobservable inputs.

Accounting Estimates

The preparation of these unaudited financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of these unaudited financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. The company’s significant estimates include those related to stock compensation and awards, and accruals for estimated administrative fees and rebate liabilities.

Basic and Diluted Net Loss per Common Share (“EPS”)

Basic net (loss) per share is computed by dividing the net (loss) attributable to the common stockholders by the weighted average number of common shares outstanding during the reporting period. Diluted net income per common share includes the potential dilution that could occur upon exercise of the options and warrants to acquire common stock computed using the treasury stock method which assumes that the increase in the number of shares is reduced by the number of shares which could have been repurchased by the Company with the proceeds from the exercise of the options and warrants (which were assumed to have been made at the average market price of the common shares during the reporting period).

Stock-Based Compensation

Compensation costs attributable to stock options, restricted stock or similar equity instruments granted are measured at the fair value at the grant date, and expensed over the expected vesting period.

Cash and Cash Equivalents

For purposes of the balance sheet and statement of cash flows, the Company considers all amounts on deposit with financial institutions and highly liquid investments with maturities of 90 days or less to be cash equivalents.

Foreign Currency Translation

The Company’s functional and reporting currency is the United States dollar. Monetary assets and liabilities denominated in foreign currencies are translated in accordance with ASC 830 Foreign Currency Matters, using the exchange rate prevailing at the balance sheet date. Gains and losses arising on settlement of foreign currency denominated transactions or balances are included in the determination of income. Foreign currency transactions are primarily undertaken in Canadian dollars. During the year ended February 29, 2012, the Company incurred no foreign currency losses. The Company has not, to the date of these financial statements, entered into derivative instruments to offset the impact of foreign currency fluctuations.

Comprehensive Income (Loss)

Comprehensive Income (loss) reflects changes in equity that results from transactions and economic events from non-owner sources. At February 29, 2012 and February 28, 2011, the Company had no items that represented of comprehensive income (loss) and, therefore, has not included a schedule of comprehensive income (loss) in these unaudited financial statements.

Asset Retirement Obligations

Topic ASC 410 addresses financial accounting and reporting for obligations associated with the retirement of tangible long-lived assets and the associated asset retirement costs. Specifically, ASC 410 requires that the fair value of a liability for an asset retirement obligation be recognized in the period in which it is incurred if a reasonable estimate of fair value can be made. In addition, the asset retirement cost is capitalized as part of the asset’s carrying value and subsequently allocated to expense over the asset’s useful life. At February 29, 2012 and February 28, 2011, the Company did not have any asset retirement obligations.

Financial Instruments

Foreign Exchange Risk

The Company may be subject to foreign exchange risk for transactions denominated in foreign currencies. Foreign currency risk arises from the fluctuation of foreign exchange rates and the degree of volatility of these rates relative to the United States dollar. The Company does not believe that it has any material risk due to foreign currency exchange.

Fair Value of Financial Instruments

The Company’s financial instruments include cash, accounts payable, accrued administrative fees and accrued professional fees. The fair value of these financial instruments approximate their carrying values due to their short maturities.

Concentration of Credit Risk

Financial instruments that potentially subject the Company to significant concentrations of credit risk consist principally of cash deposits. At February 29, 2012 and February 28, 2011, any cash held by the Company was held in fully insured accounts in institutions insured by the Federal Deposit Insurance Corporation. As part of its cash management process, the Company performs periodic evaluations of the relative credit standing of its financial institution. The Company has not experienced any losses in cash balances and does not believe it is exposed to any significant credit risk on its cash.

Recent Accounting Pronouncements:

ASU 2011-5, Statement of Comprehensive Income will be effective for the next reporting period, but the guidance which requires companies to present net income and comprehensive income in one continuous statement or two consecutive statements should have no impact on the Company’s financial statements.

The Company has reviewed all recently issued, but not yet effective, accounting pronouncements and does not believe the future adoption of any such pronouncements may be expected to cause a material impact on its financial condition or the results of its operations.

- Definition

The entire disclosure for all significant accounting policies of the reporting entity.

+ References+ Details

TheraBiogen, Inc. 10-K/A