The following Management's Discussion and Analysis of Financial Condition and Results of Operations ("MD&A") provides information for the year ended December 31, 2022. This MD&A should be read together with our audited consolidated financial statements and the accompanying notes for the year ended December 31, 2022 (the "consolidated financial statements"). The consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States ("U.S. GAAP"). Except where otherwise specifically indicated, all amounts in this MD&A are expressed in United States dollars.

Certain statements in this MD&A constitute forward-looking statements or forward-looking information within the meaning of applicable securities laws. You should carefully read the cautionary note in this MD&A regarding forward-looking statements and should not place undue reliance on any such forward-looking statements. See "Cautionary Note Regarding Forward-Looking Statements".

Additional information about the Company, including our most recent consolidated financial statements and our Annual Information Form, is available on our website at www.igen-networks.com, or on SEDAR at www.sedar.com and on EDGAR at www.sec.gov .

Cautionary Note Regarding Forward-looking Statements

Certain statements and information in this MD&A are not based on historical facts and constitute forward- looking statements or forward-looking information within the meaning of the U.S. Private Securities Litigation Reform Act of 1995 and Canadian securities laws ("forward-looking statements"), including our business outlook for the short and longer term and our strategy, plans and future operating performance. Forward-looking statements are provided to help you understand our views of our short and longer term prospects. We caution you that forward-looking statements may not be appropriate for other purposes. We will not update or revise our forward-looking statements unless we are required to do so by securities laws. Forward-looking statements:





    ·   Typically include words and phrases about the future such as "outlook",
        "may", "estimates", "intends", "believes", "plans", "anticipates" and
        "expects";

    ·   Are not promises or guarantees of future performance. They represent our
        current views and may change significantly;

    ·   Are based on a number of assumptions, including those listed below, which
        could prove to be significantly incorrect:





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    ·   Our ability to find viable companies in which to invest;

    ·   Our ability to successfully manage companies in which we invest;

    ·   Our ability to successfully raise capital;

    ·   Our ability to successfully expand and leverage the distribution channels
        of our portfolio companies;

    ·   Our ability to develop new distribution partnerships and channels;

    ·   Expected tax rates and foreign exchange rates.




    ·   Are subject to substantial known and unknown material risks and
        uncertainties. Many factors could cause our actual results, achievements
        and developments in our business to differ significantly from those
        expressed or implied by our forward-looking statements. Actual revenues
        and growth projections of the Company or companies in which we are
        invested may be lower than we expect for any reason, including, without
        limitation:




  · the continuing uncertain economic conditions;

  · price and product competition;

  · changing product mixes;

  · the loss of any significant customers;

  · competition from new or established companies;

  · higher than expected product, service, or operating costs;

  · inability to leverage intellectual property rights;

  · delayed product or service introductions;

Investors are cautioned not to place undue reliance on these forward-looking statements. No forward-looking statement is a guarantee of future results.





Overview

During fiscal-year 2022, the Company's automotive dealership channels faced significant supply-chain issues that reduced available inventory and diminished profit margins. Despite these challenges IGEN continued to make progress with creating new opportunities and products in 2022. The Company moved into new offices located in Lake Elsinore in anticipation of significant growth post 2022 challenges. Creating new channels and partnerships in 2022 were key initiatives to secure longer term market share with both our consumer and commercial customers. Product and software innovation was our priority with the recent launch of our Next-Generation Platform and Medallion GPS created for Light-to-Heavy Commercial Fleets, both developed with IGEN's patented Driver Signature and Behavior algorithms.

For the year ended December 31, 2022, the Company recognized revenues of $318,016 with a gross loss of (1)% and $(4,550) gross loss. Expenses for the year ended December 31, 2022, totaled $864,970, a decrease of $2,708,313, or 76%, from total expenses reported for 2021. Excluding stock-based compensation expense to our directors, operational expenses decreased by 16% year on year.

For the year ended December 31, 2022, the Company saw a net decrease in cash of $64,429. Cash used in operating activities was $978,056, an increase in cash used of 2% from the $962,960 net cash used in 2021. This was offset by net financings of $543,746 raised via private placements. Cash at the end of the year was $0.

Notable highlights of the year ended December 31, 2022 include the following Company achievements:

I) IGEN established a partnership with Prolog with the integration of

technology platforms to better serve the US Government markets

IGEN launches Medallion GPS PRO for Medium-to-Heavy Duty Commercial

Fleets

ii) IGEN announces an exclusive marketing agreement with the Association

of Credit Unions Executives of Puerto Rico

iii) IGEN files Patent-Pending Application for creating real-time driver

Telematic Signatures for autonomous vehicles

iv) IGEN receives patent acceptance for its Digital Telematics Signature

(DTC) patent for greater accuracy in measuring driver performance

v) IGEN is awarded a contract to provide Fleet Management Services to

all New-York State Counties

vi) IGEN reports a net income and profit for the June 30, 2022 reporting


     period







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CRITICAL ACCOUNTING POLICIES AND SIGNIFICANT JUDGMENTS AND ESTIMATES

Our management's discussion and analysis of our financial condition and results of operations are based on our consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States ("GAAP"). The preparation of these consolidated financial statements requires us to make estimates and judgments that affect the reported amount of assets, liabilities, and expenses and the disclosure of contingent assets and liabilities as of the date of the consolidated financial statements. On an ongoing basis, we evaluate our estimates and judgments. We base our estimates on historical experience, known trends and events, and various other factors that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ materially from these estimates under different assumptions or conditions.





Accounts Receivable

Accounts receivable are recognized and carried at the original invoice amount less an allowance for expected uncollectible amounts. Inherent in the assessment of the allowance for doubtful accounts are certain judgments and estimates including, among others, the customer's willingness or ability to pay, the Company's compliance with customer invoicing requirements, the effect of general economic conditions and the ongoing relationship with the customer. Accounts with outstanding balances longer than the payment terms are considered past due. We do not charge interest on past due balances. The Company writes off trade receivables when all reasonable collection efforts have been exhausted. Bad debt expense is reflected as a component of general and administrative expenses in the consolidated statements of operations.

Goodwill

Goodwill represents the excess of the acquisition price over the fair value of identifiable net assets acquired. Goodwill is allocated at the date of the business combination. Goodwill is not amortized, but is tested for impairment annually on December 31 of each year or more frequently if events or changes in circumstances indicate the asset may be impaired. These events and circumstances may include a significant change in legal factors or in the business climate, a significant decline in the Company's share price, an adverse action of assessment by a regulator, unanticipated competition, a loss of key personnel, significant disposal activity and the testing of recoverability for a significant asset group.

Goodwill impairment is measured as the amount by which a reporting unit's carrying value exceeds its fair value.

The Company has only one reporting unit. Therefore, all of the Company's goodwill relates to that reporting unit, and at December 31, 2022 and 2021, the carrying value for that reporting unit is negative.





Fair Value Measurements

In accordance with Financial Accounting Standard Board ("FASB") Accounting Standards Codification ("ASC") 820, "Fair Value Measurements and Disclosures," the Company is to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 820 establishes a fair value hierarchy based on the level of independent, objective evidence surrounding the inputs used to measure fair value. A financial instrument's categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. ASC 820 prioritizes the inputs into three levels that may be used to measure fair value:





Level 1

Level 1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities.





Level 2

Level 2 applies to assets or liabilities for which there are inputs other than quoted prices that are observable for the asset or liability such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data.





Level 3

Level 3 applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities.






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The fair values of cash and cash equivalents, accounts and other receivables, restricted cash, and accounts payable and accrued liabilities, approximate their carrying values due to the immediate or short-term maturity of these financial instruments. Foreign currency transactions are primarily undertaken in Canadian dollars. The fair value of cash is determined based on "Level 1" inputs and the fair value of derivative liabilities is determined based on "Level 3" inputs. The recorded values of notes payable, approximate their current fair values because of their nature and respective maturity dates or durations. The financial risk is the risk to the Company's operations that arise from fluctuations in foreign exchange rates and the degree of volatility to these rates. Currently, the Company does not use derivative instruments to reduce its exposure to foreign currency risk. Financial instruments that potentially subject the Company to concentrations of credit risk consists of cash. The Company places its cash and cash equivalents in what it believes to be credit-worthy financial institutions.

Revenue Recognition and Deferred Revenue

We recognize revenue in accordance with ASC 606, "Revenue from Contracts with Customers", using the five-step model, including (1) identify the contract with the customer, (2) identify the performance obligations in the contract, (3) determine the transaction price, (4) allocate the transaction price to the performance obligations in the contract, and (5) recognize revenue in accordance with U.S. GAAP. Title and risk of loss generally pass to our customers upon delivery, as we have insurance for lost shipments. In limited circumstances where either title or risk of loss pass upon destination or acceptance or when collection is not reasonably assured, we defer revenue recognition until such events occur. We derive substantially all our revenues from the sale of products and services combined into one performance obligation. Product revenue includes the shipment of product according to the agreement with our customers. Service revenue include vehicle tracking services and customer support (technical support), installations and consulting. A contract usually includes both product and services. For these contracts, the Company accounts for individual performance obligations separately if they are distinct. Performance obligations include, but are not limited to, pass-thru harnesses and vehicle tracking services. Almost all of our revenues are derived from customers located in United States of America in the auto industry. The transaction price is allocated to the separate performance obligations on a relative standalone selling price basis. Standalone selling prices are typically estimated based on observable transactions when these services are not sold on a standalone basis. At contract inception, an assessment of the goods and services promised in the contracts with customers is performed and a performance obligation is identified for each distinct promise to transfer to the customer a good or service (or bundle of goods or services). To identify the performance obligations, the Company considers all of the goods or services promised in the contract regardless of whether they are explicitly stated or are implied by customary business practices. Revenue is recognized when our performance obligation has been met. The Company considers control to have transferred upon delivery because the Company has a present right to payment at that time, the Company has transferred use of the asset, and the customer is able to direct the use of, and obtain substantially all of the remaining benefits from, the asset. For arrangements under which the Company provides vehicle tracking services, the Company satisfies its performance obligations as those services are performed whereby the customer simultaneously receives and consumes the benefits of such services under the agreement. Revenues are recognized net of any taxes collected from customers, which are subsequently remitted to governmental authorities.

The Company provides product warranties with varying lengths of time and terms. The product warranties are considered to be assurance-type in nature and do not cover anything beyond ensuring that the product is functioning as intended. Based on the guidance in ASC 606, assurance-type warranties do not represent separate performance obligations. The Company has historically experienced a low rate of product returns under the warranty program.

Management assesses the business environment, customers' financial condition, historical collection experience, accounts receivable aging, and customer disputes to determine whether collectability is reasonably assured. If collectability is not reasonably assured at the time of sale, the Company does not recognize revenue until collection occurs.

Revenue relating to the sale of service fees on its vehicle tracking and recovery services is recognized over the life of the contact. The service renewal fees are offered in terms ranging from 12 to 36 months and are generally payable upon delivery of the vehicle tracking devices or in full upon renewal.

Deferred revenues are recorded net of contract assets when cash payments are received from customers in advance of the Company's performance. Contract assets represent the costs of the underlying hardware to enable the Company to perform on its contracts with customers and are amortized using the same method and term as deferred revenues. Any revenue that has been deferred and is expected to be recognized beyond one year is classified as deferred revenue, net of current portion.

Financing Costs and Debt Discount

Financing costs and debt discounts are recorded net of notes payable and convertible debentures in the consolidated balance sheets. Amortization of financing costs and the debt discounts is calculated using the effective interest method over the term of the debt and is recorded as interest expense in the consolidated statement of operations.

Recent Accounting Pronouncements

See the notes to the consolidated financial statements of this Form 10-K for further discussion.






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Capital Resources and Liquidity

Current Assets and Liabilities, Working Capital

As of December 31, 2022, the Company had total current assets of $52,043, a 70% decrease from the end of 2021. This decrease was mostly due to a $122,323 decrease in cash, accounts receivable, and inventory, because of the timing of payments to Nimbo from its customers and a decrease in new sales contracts in Q4 2022.

The Company's current liabilities as of December 31, 2022, were $1,186,049, a 9% increase over those reported at the end of the 2021. However, $81,066 (or 7%) of the Company's current liabilities were deferred revenues, net to be recognized in future periods. The increase in current liabilities was mostly due to a $482,408 increase in notes payable as of December 31, 2022.

IGEN ended 2022 with negative working capital of $1,134,006. Adequate working capital remains a core requirement for growth and profitability and to facilitate further acquisitions, and the Company continues to work at improving its working capital position through ongoing equity and debt financing and actively managing the Company's growth to achieve sustainable positive cash flow.

In 2022, the Company raised an additional $1,070,746 in financings and borrowing on notes payable and converted $437,139 of preferred stock into shares of common stock. These transactions are further disclosed in notes to the consolidated financial statements.

Total Assets and Liabilities, Net Assets

As of December 31, 2022, the Company's total assets were $616,290, a 19% decrease over the prior year, due primarily to the decrease in current assets previously discussed. The majority of the Company's assets remain $505,508 in goodwill associated with the acquisition of Nimbo in 2014.

As of December 31, 2022, the Company's total liabilities were $1,455,515, which reflects $81,632 in long-term deferred revenue, net in addition to the $1,186,049 in current liabilities previously discussed. This long-term deferred revenue is the portion of service contracts signed in previous years for which service, and the associated revenue recognition, occurs beyond 2023. Total liabilities increased by 6% over the previous year, however 11%, or $162,698 of the Company's year-end total liabilities was deferred revenue, net, compared with $145,485 of deferred revenue, net reported at the end of 2021.

The above resulted in net assets as of December 31, 2022 being ($839,225) and an accumulated deficit of $20,170,140.

The Company is continuing its efforts to increase its asset base, raise funds and improve cashflow to improve its working capital position. As of the date these financial statements were issued, the Company believes it has adequate working capital and projected net revenues and cash flows to maintain existing operations for approximately six months without requiring additional funding. The Company's business plan is predicated on raising further capital for the purpose of further investment and acquisition of targeted technologies and companies, to fund growth in these technologies and companies, and to expand sales and distribution channels for companies it currently owns or is invested. It is anticipated the Company will continue to raise additional capital through private placements or other means in the both the near and medium term.

The reader is cautioned that the Company's belief in the adequacy of its working capital, the continuation and growth of future revenue, the ability of the Company to operate any stated period without additional funding, and the ability to successfully raise capital are forward looking statements for which actual results may vary, to the extent that the company may need capital earlier than anticipated and/or may not be able to raise additional capital.





Results of Operations



Revenues and Net Loss



Revenues

For the year ended December 31, 2022, the Company had revenues of $318,016, an 18% increase over the revenues reported for same period in 2021. Increase in revenue was primarily due to the impact of COVID-19 in 2021 on demand for new vehicles at our customers' franchise dealerships.

Costs of goods sold for 2022 were $322,566, representing an increase of 161% year on year. These costs are primarily mobile hardware and cellular carrier costs.

The resulting gross loss was $4,550, representing a decrease of 103% year on year, and gross margins of (1%).

Though the Company increased revenues, decreased gross profit, and decreased gross margins year on year, we continue to review hardware vendor, inventory, and order fulfillment strategies as well as product and service pricing models to continually improve overall margins.






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Expenses

Expenses for the year ended December 31, 2022, totaled $903,048, a decrease of $2,670,235, or 75%, from total expenses reported for 2021. Excluding stock-based compensation expense to our directors, operational expenses increased by 4% year on year.





Net Loss

For the year ended December 31, 2022, the Company had a net loss of $907,598 (or ($0.00) per basic and diluted share) compared with a net loss of $3,428,937 (or ($0.00) per basic and diluted share) in 2021. Included in the net loss of $907,598, is $301,360 of other income related to the Company's gain on settlement of debt recognized in 2022.

The Company continues to invest in personnel, channels, and product development in order to drive revenue growth and increase gross profits sufficient to enable the Company to achieve profitability.





Cash Flows

For the year ended December 31, 2022, the Company saw a net decrease in cash of $64,429. Cash used in operating activities was $978,056, an increase in cash used of 2% from the $962,960 net cash used in 2021. This was offset by net financings of $543,746 raised via private placements. Cash at the end of the year was $0.

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