What changed in this filing

/stocks — the workspaceLOADING

Item 5. Market for Registrant’s Common Equity

2022-03-29 compared with 2021-03-25 · 87 added, 96 removed, 186 unchanged (50% of the section changed)

6 unchanged sentences

On December 24, 2019, the Company announced the payment of a $0.50 special cash dividend per share of Common Stock payable on January 14, 2020 for an aggregate amount of $2,250,636, which was applied against paid in capital.

On December 10, 2020, the Company announced the payment of a $0.40 special cash dividend per share of Common Stock payable on December 28, 2020, for an aggregate amount of $1,800,509 which was applied against paid in capital.

On June 21, 2021, the Company announced the payment of a $0.60 special cash dividend per share of Common Stock to shareholders of record July 9, 2021.

The dividend was paid on July 16, 2021 in the amount of $3,081,706.

The declaration of any future cash dividends is at the discretion of our board of directors and depends upon our earnings, if any, our capital requirements and financial position, our general economic conditions, and other pertinent conditions.

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Our transfer agent is Pacific Stock Transfer Company at 6725 Via Austi Pkwy, Suite 300, Las Vegas, NV 89119.

Selected Financial Data

Not applicable.

Management ’ s Discussion and Analysis of Financial Condition and Results of Operations

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and to materially profit from enhanced operational functionality, process flexibility and expedited process execution.

We are a business application, technology and consulting company providing strategies and solutions to meet our clients’ information, technology and business management needs.

Our services and technologies enable customers to manage, protect and monetize their enterprise assets whether on-premise or in the cloud.

As a value-added reseller of business application software, we offer solutions for accounting and business management, financial reporting, Enterprise Resource Planning (“ERP”), Human Capital Management (“HCM”), Warehouse Management Systems (“WMS”), Customer Relationship Management (“CRM”), and Business Intelligence(“BI”).

Additionally, we have our own development staff building software solutions for various ERP enhancements.

Our value-added services focus on consulting and professional services, specialized programming, training, and technical support.

We have a dedicated Information Technology (“IT”) network services practice that provides managed services, Infrastructure-as-a-Service, cybersecurity, application hosting, disaster recovery, business continuity, cloud and other services.

Our customers are nationwide, with concentrations in the New York/New Jersey metropolitan area, Arizona, Southern California, North Carolina, Washington, Oregon and Illinois.

As Microsoft Certified Systems Engineers and Microsoft Certified Professionals, our staff offers a host of mission critical services, including cybersecurity, business continuity, disaster recovery, application hosting, remote network monitoring, server implementation, support and assistance, and technical design of network infrastructure, among other services.

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Led by specialized project managers, we provide professional services ranging from software customization to data migration to small- and medium-size business consulting.

We also are resellers of the Warehouse Management System (“WMS”) software published by Korber, which develops warehouse management software for middle market distributors.

We also are resellers of the WMS software published by Korber, which develops warehouse management software for middle market distributors.

The primary purpose of a WMS is to control the movement and storage of materials within an operation and process the associated transactions.

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To date, we have completed a series of strategic ventures that have served to fundamentally strengthen our Company’s operating platform and materially expand our footprint to nearly every U.S.

More specifically, over the past fifteen years, we have outright acquired, acquired select assets of or entered into revenue sharing agreements with Business Tech Solutions Group, Inc.;

More specifically, over the past fifteen years, we have outright acquired select assets of or entered into revenue sharing agreements with Business Tech Solutions Group, Inc.;

Wolen Katz Associates;

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Pinsight Technology, Inc.;

Info Sys Management, Inc., Nellnube, Inc., Partners in Technology Inc., Prairie Technology Solutions Group, Inc., Computer Management Services, LLC and Business Software Solutions.

Info Sys Management, Inc., Nellnube, Inc., Partners in Technology Inc., Prairie Technology Solutions Group, Inc., Computer Management Services, LLC, Business Software Solutions, PeopleSense, Inc., and more recently Dynamic Tech Services, Inc.

and NEO3, LLC.

Additionally, it is our intention to continue to increase our business by seeking additional opportunities through potential acquisitions, revenue sharing arrangements, partnerships or investments.

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Service revenue increased by $279,167 (0.8%) to $33,837,993 in 2021 from $33,558,826 in 2020.

The overall increases are primarily due to increases in services related to increased volume of sales of software.

This increase is mainly attributed to increases in managed services and application hosting as we continue to focus in this area due to the needs of our customers’ digital transformation and the further requirement of customers to have the ability within their organizations to work remotely, particularly during the Covid pandemic.

Gross profit for the year ended December 31, 2021 increased $629,077 (3.8%) to $17,208,058 as compared to $16,578,981 for the year ended December 31, 2020.

The increase in overall gross profit for this period is largely attributable to the increase in revenues and the sale of higher margin products and services.

The increase in overall gross profit for this period is attributable to the increase in revenues and the sale of higher margin products and services.

For the year ended December 31, 2021, the overall gross profit percentage was 41.3% as compared to 40.2 % for the year ended December 31, 2020.

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For the year ended December 31, 2021, the gross profit percentage for software was 41.8% as compared to 39.8 % for the year ended December 31, 2020.

This increase is due mostly to the increased sale of higher margin products.

While revenues may decrease because of the shift to a subscription business model, our margins will, for the most part, not significantly change.

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The gross profit attributed to services increased $393,767 (2.9%) to $13,920,057 for 2021 from $13,526,290 in 2020.

This increase is attributed to the increases in consulting revenue as well as increases in network managed services and application hosting.

This increase is attributed to revenue increases in managed services and application hosting, which provide for higher profit margins, and increases in commission and maintenance revenue for the period offset partially by costs associated with the learning curve related to the training of new employees, who were hired to accommodate our growth.

For the year ended December 31, 2021, the gross profit percentage for services was 41.1% as compared to 40.3% for the year ended December 31, 2020.

The increase in the gross profit percentage can be attributed to the increase in network managed services and application hosting which has a higher gross profit as well as the overall change in product mix.

Operating Expenses

Selling and marketing expenses increased $527,167 (7.7%) to $7,365,912 for the year ended December 31, 2020 as compared to $6,838,745 for the year ended December 31, 2019.

This increase is due to both additional headcount as well as increased variable compensation because of increased sales.

General and administrative expenses decreased $499,407 (5.7%) to $8,273,558 for the year ended December 31, 2020 as compared to $8,772,965 for the year ended December 31, 2019.

This decrease is primarily the result of decreases in travel expenses as a result of less employees traveling during the pandemic, reduced credit card expenses as well as department changes for various employees, thereby reducing salary and benefit expense.

In addition, in 2019 the Company incurred a one-time legal expense of approximately $115,000 associated with the cost of defense of the previously announced and settled shareholder derivative suit.

Selling and marketing expenses decreased $646,003 (8.8%) to $6,719,909 for the year ended December 31, 2021 as compared to $7,365,912 for the year ended December 31, 2020.

This decrease is primarily due to lower travel and entertainment expense and reduced attendance at conferences and trade shows and lower marketing expenses.

In addition, we experienced a slight reduction in payroll related expenses because of departmental changes for various employees, thereby reducing salary and benefit expense.

General and administrative expenses increased $1,128,701 (13.6%) to $9,402,259 for the year ended December 31, 2021 as compared to $8,273,558 for the year ended December 31, 2020.

This increase primarily a result of increases in payroll and payroll related expenses related to both additional personnel and departmental changes for various employees, which increased salary and benefit expense.

Share-based compensation increased $431,116 to $441,310 for the year ended December 31, 2021 as compared to $10,194 for the year ended December 31, 2020.

The increase is due to the issuance of stock options at the end of March 2021 and in October 2021.

Depreciation and amortization expense for the year ended December 31, 2021 was $875,566 as compared to $705,932 for the year ended December 31, 2020.

This decrease is due to some equipment being fully depreciated in 2020.

Impairment for intangible asset expense for the year ended December 31, 2020 was $-0- as compared to $236,860 for the year ended December 31, 2019.

The decrease is due to the write-off of software in 2019 that will no longer be marketed.

Income (Loss) from Continuing Operations

As a result of the above, the Company generated income from continuing operation of $223,385 for the year ended December 31, 2020 as compared to a loss from continuing operation in the amount of $1,907,061 for the year ended December 31, 2019.

Other Expense

For the year ended December 31, 2020 other expense was $347 as compared to $15,809 for the year ended December 31, 2019, primarily because of lower interest expense.

Income (Loss) from Continuing Operations Before Taxes

As a result of the above, the Company generated income from continuing operation before taxes of $223,038 for the year ended December 31, 2020 as compared to a loss from continuing operation before taxes in the amount of $1,922,870 for the year ended December 31, 2019.

For the year ended December 31, 2020, the Company recorded a tax provision of $47,391 as compared to a benefit of $455,006 for the year ended December 31, 2019 because of the income generated in the current year.

This increase of $169,634 (24%) for the year ended December 31, 2021 is primarily due to the additional amortization of intangible assets related to the new acquisitions.

(Loss) Income from Operations

As a result of the above, the Company had a loss from operations of $230,986 for the year ended December 31, 2021 as compared to income from operations of $223,385 for the year ended December 31, 2020.

Other Income (Expense)

For the year ended December 31, 2021 other income was $274,557 as compared to other expense of $347 for the year ended December 31, 2020.

The year ended December 31, 2021 includes the gain on the sale of a product line in the amount of $250,000 as well as a gain of a bargain purchase from an acquisition in the amount of $71,359.

(Loss) Income Before Taxes

As a result of the above, the Company generated income before taxes of $43,571 for the year ended December 31, 2021 as compared to income before taxes in the amount of $223,038 for the year ended December 31, 2020.

For the year ended December 31, 2021, the Company recorded a tax provision of $178,005 as compared to a tax provision in the amount of $47,391 for the year ended December 31, 2020, primarily due to the non-cash share-based compensation due to the issuance of stock options which are not tax deductible in the current year.

State provision requirements were calculated based on the estimated tax rate.

Net Income (Loss) from Continuing Operations

As a result of the above, the Company generated net income from continuing operation of $175,647 for the year ended December 31, 2020 as compared to a net loss from continuing operation in the amount of $1,467,864 for the year ended December 31, 2019.

The Federal effective rate is higher than the statutory rate primarily due to the non-cash share-based compensation due to the issuance of stock options which are not tax deductible.

Net (Loss) Income

As a result of the above, the Company generated a net loss of $134,434 for the year ended December 31, 2021 as compared to a net income of $175,647 for the year ended December 31, 2020.

Liquidity and Capital Resources

The negative impact of Covid-19 on the economy creates tremendous uncertainty for the Company in the coming months and quarters.

While our Company has not been significantly impacted as a result of this uncertainty, the negative impact on our business, in the future, is impossible to determine at this point, although it is likely that we could suffer negative consequences as many companies go out of business or decrease their technology spending.

As previously disclosed, SWK Technologies, Inc.

(“SWK”), a wholly-owned subsidiary of SilverSun Technologies, Inc.

(the “Company”), entered into a promissory note (the “Note”) with JPMorgan Chase Bank, N.A.

(the “Lender”), which provided for a loan in the amount of $3,150,832 (the “PPP Loan”) pursuant to the Paycheck Protection Program under the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”).

At the time SWK applied for the PPP Loan, we believed that it qualified to receive funds pursuant to the then published PPP qualification and certification requirements.

On April 23, 2020, the SBA, in consultation with the Department of Treasury, issued new guidance that creates uncertainty regarding the qualification requirements for a PPP Loan (the “New Guidance”).

Out of an abundance of caution and in light of the New Guidance, SWK determined to pay off the entire amount of the PPP Loan.

Accordingly, the PPP Loan was paid in full to the Lender on May 18, 2020, resulting in the full satisfaction of the Note.

Under the terms of the PPP Loan, SWK had the right to repay the Note without penalty.

The negative impact of Covid-19 on the economy continues to create uncertainty for the Company in the coming months and quarters.

While our Company has not been significantly impacted because of this uncertainty, the negative impact on our business, in the future, is impossible to determine at this point, although it is likely that we could suffer negative consequences as many companies go out of business or decrease their technology spending.

The Company currently has no line of credit or other credit facility with any lender.

As such, we need to rely on our own limited resources to weather the anticipated economic downturn.

Our competitors, almost all of whom are privately held, and able to avail themselves of the PPP program, will make it more difficult for the Company to compete in the marketplace.

Our competitors, almost all of whom are privately held, were able to avail themselves of the PPP program, making it more difficult for the Company to compete in the marketplace while we could not.

Management will continue to monitor developments, explore various cost-cutting measures, and explore other sources of funding, but there is no guarantee we will be successful in doing so.

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(i) strategic acquisitions or investments;

(ii) an increase to current company personnel;

(ii) an increase in current company personnel;

(iii) the level of resources that we devote to sales and marketing capabilities;

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and (v) the activities of competitors.

In addition to developing new products, obtaining new customers and increasing sales to existing customers, management plans to increase its business and profitability by entering into collaboration agreements, buying assets, and acquiring companies in the business software and information technology consulting and other markets with solid revenue streams and established customer bases that generate positive cash flow.

On May 31, 2018, SWK acquired certain assets of Info Sys Management, Inc.

(“ISM”) pursuant to an Asset Purchase Agreement for cash of $300,000 and a promissory note issued in the aggregate principal amount of $1,000,000 (the “ISM Note”).

The ISM Note is due five years from the closing date and bears interest at a rate of two percent (2%) per annum.

Monthly payments including interest are $17,528.

The ISM Note has an optional conversion feature where the holder may, at its sole and exclusive option, elect to convert, at any time and from time to time, until payment in full of the ISM Note, all of the outstanding principal amount of the ISM Note, plus accrued interest, into shares (the “Conversion Shares”) of the Company’s Common Stock, (“Common Stock”) at per share price equal to $4.026, a price equal to the average closing price of its Common Stock for the five (5) trading days immediately preceding the issuance date of the ISM Note (the “Fixed Conversion Price”).

In February 2021, ISM converted the outstanding balance of the loan in the amount of $479,112 into 119,004 shares of the Company’s common stock.

On May 31, 2018, Secure Cloud Services acquired certain assets of Nellnube, Inc.

(“Nellnube”) pursuant to an Asset Purchase Agreement for a promissory note issued in the aggregate principal amount of $400,000 (the “Nellnube Note”).

The Nellnube Note is due five years from the closing date and bears interest at a rate of two percent (2%) per annum.

Monthly payments including interest are $7,011.

The Nellnube Note has an optional conversion feature where the holder may, at its sole and exclusive option, elect to convert, at any time and from time to time, until payment in full of the Nellnube Note, all of the outstanding principal amount of the Nellnube Note, plus accrued interest, into shares (the “Conversion Shares”) of the Company’s Common Stock, (“Common Stock”) at per share price equal to $4.026, a price equal to the average closing price of its Common Stock for the five (5) trading days immediately preceding the issuance date of the Nellnube Note (the “Fixed Conversion Price”).

In February 2021, Nellnube converted the outstanding balance of the loan in the amount of $191,645 into 47,602 shares of the Company’s common stock.

On January 1, 2019, SWK acquired certain assets of Partners in Technology, Inc.

(“PIT”) pursuant to an Asset Purchase Agreement for cash of $60,000 and the issuance of a promissory note in the aggregate principal amount of $174,000 (the “PIT Note”).

The PIT Note is due in 36 months from the closing date and bears interest at a rate of two percent (2.0%) per annum.

Monthly payments including interest are $4,984.

At December 31, 2020 and December 31, 2019, the outstanding balances of the loan were $64,040 and $121,968, respectively.

On July 31, 2020, the Company acquired certain assets of Prairie Technology Solutions Group, LLC (“Prairie Tech”) pursuant to an Asset Purchase Agreement.

In consideration for the acquired assets, the Company paid $185,000 in cash and issued three promissory notes to Prairie Tech (“Prairie Tech Note 1”, “Prairie Tech Note 2” and “Prairie Tech Note 3”), each in the principal aggregate amount of $103,333 (collectively the “Prairie Tech Notes”).

The Prairie Tech Notes bear interest at a rate of 4% per annum.

Prairie Tech Note 1 has a term of one (1) year and is subject to downward adjustment based on whether certain revenue milestones are achieved.

Prairie Tech Note 2 has a term of two (2) years and is also subject to downward adjustment based on whether certain revenue milestones are achieved.

Prairie Tech Note 3 has a term of three (3) years and is not subject to a downward adjustment.

At December 31, 2020 the outstanding balance on the PT notes were $310,000.

On October 1, 2020, SWK acquired certain assets of Computer Management Services, LLC, (“CMS”) pursuant to an Asset Purchase Agreement for and the issuance of a promissory note in the aggregate principal amount of $170,000 (the “CMS Note”) for a total of $287,598.

The CMS Note is due in 36 months from the closing date and bears interest at a rate of two percent (2.0%) per annum.

In February 2021, the Company received net proceeds of $3,382,352, excluding legal expenses, from the sale of 393,300 of common stock under its Registration Statement on Form S-3 and the previously disclosed At Market Issuance Sales Agreement.

In April 2021, the Company entered into the 2021 At Market Agreement with H.C.

Wainwright & Co.

(the “Sales Agent”) under which the Company may issue and sell shares of its common stock having an aggregate offering price of up to $3,308,842 from time to time through the Sales Agent.

Sales of the Company’s common stock through the Sales Agent, if any, will be made by any method that is deemed an “at the market” offering as defined by the SEC.

The Company will pay to the Sales Agent a commission rate equal to 3.0% of the gross proceeds from the sale of any shares of common stock sold through the Sales Agent under the 2021 At Market Agreement.

In June 2021, 65,452 shares of Common Stock were issued and sold generating $722,116 under The At Market Agreement, excluding legal expenses.

In July 2021, an additional 9,548 shares of Common Stock were issued and sold generating $76,436, net of legal expenses.

On June 21, 2021, the Company announced the payment of a $0.60 special cash dividend per share of Common Stock to shareholders of record July 9, 2021.

The dividend was paid on July 16, 2021 in the amount of $3,081,706.

On April 1, 2021, the Company acquired certain assets of CT-Solution, Inc.

(“CTS”) pursuant to an Asset Purchase Agreement.

In consideration for the acquired assets, the Company issued a promissory note to CTS in the principal aggregate amount of $130,000 (the CTS Note”).

The CTS Note is due in 36 months from the closing date and bears interest at a rate of two (2%) percent per annum.

Monthly payments including interest are $3,724.

At December 31, 2020 the outstanding balance of the loan was $160,821.

On December 1, 2020, SWK acquired certain assets of Business Software Solutions (“BSS”) pursuant to an Asset Purchase Agreement for a promissory note in the aggregate principal amount of $230,000 (the “BSS Note”).

The BSS Note is due in 60 months from the closing date and bears interest at a rate of two percent (2.0%) per annum.

On May 1, 2021, SWK acquired certain assets of PeopleSense, Inc.

(“PSI”) pursuant to an Asset Purchase Agreement for cash of $145,703, customer deposits related to prepaid time from clients in the amount of $99,938, and the issuance of a promissory note in the aggregate principal amount of $450,000 (the “PSI Note”).

The PSI Note is due in 36 months from the closing date and bears interest at a rate of two percent (2.0%) per annum.

Monthly payments including interest are $12,889.

At December 31, 2020 the outstanding balance of the loan was $230,000.

During the year ended December 31, 2020, the Company had a net decrease in cash of $2,062,985.

On January 1, 2022 (“Effective Date”), the Company entered into an Asset Purchase Agreement with Dynamic Tech Services, Inc.

(“DTS”) to acquire certain assets of DTS.

The purchase price for the acquired assets was $1,335,000, $500,000 of which was paid in cash and $835,000 of which was paid through the issuance of a four-year $835,000 promissory note dated January 1, 2022, paying interest at the rate of 3.25% per annum (the “DTS Note”).

The principal amount of the Note is subject to a downward adjustment in the event the Company loses any subscription renewal revenue during the one-year period immediately following the Effective Date from any persons that were customers of DTS immediately prior to the Effective Date (the “DTS Customers”).

Any such downward adjustment will be determined by calculating the percentage of loss of Acumatica subscription renewals during the one-year period immediately following the Effective Date from DTS Customers.

In the event that subscription renewal revenue received from DTS Customers during the one-year period immediately following the Effective Date is less than 95% of the subscription renewal revenue received by DTS from DTS Customers during the one-year period immediately preceding the Effective Date, the principal amount of the Note will be reduced.

The measuring period for any downward adjustment will be as of the one-year anniversary of the Effective Date.

Notwithstanding the foregoing, under no circumstances will the principal amount of the Note be reduced by reason of such downward adjustment by more than $150,000 ( i.e.

, to a principal amount below $685,000).

The Note will be amortized as follows:

The first payment of principal and interest due under the Note, which will be an annual payment, is due and payable on January 1, 2023, after the revised principal amount of the Buyer Note is determined and thereafter, payments will be made quarterly in twelve equal installments.

On January 22, 2022, the Company entered into an agreement to acquire certain assets of NEO3, LLC (“NEO3”).

The purchase price for the acquired assets was $225,000, $150,000 of which was paid in cash and $75,000 of which was paid through the issuance of a three-year $75,000 promissory note dated January 22, 2022, paying interest at the rate of 2% per annum (“the “NEO3 Note”).

During the year ended December 31, 2021, the Company had a net increase in cash of $218,701.

The Company’s principal sources and uses of funds were as follows:

Cash provided by (used in) operating activities of continuing operations

The Company provided $1,729,091 in cash from continuing operating activities for the year ended December 31, 2020 as compared to using $903,307 of cash for continuing operating activities for the year ended December 31, 2019.

This increase is in cash provided by operating activities is primarily due to an increase in income and the decrease in accounts receivable offset partially by the decrease in accounts payable and deferred revenues.

Cash provided by investing activities of continuing operations

Investing activities for the year ended December 31, 2020 provided cash of $839,808 as compared to providing $8,152,790 of cash for the year ended December 31, 2019.

This decrease in cash provided is due to proceeds received from the sale of the EDI practice in August 2019 and which did not occur during the year ended December 31, 2020.

Cash used in financing activities of continuing operations

Financing activities for the year ended December 31, 2020 used cash of $4,631,884 as compared to using cash of $870,170 for the year ended December 31, 2019.

This increase in cash used in financing activities is mostly attributed to the payment of a cash dividends in January 2020 and December 2020.

Cash flows from discontinued operations

There were no cash flows related to discontinued operations for the year ended December 31, 2020.

Operating activities for discontinued operations for the year ended December 31, 2019 provided cash of $505,910.

This is due to the fact that Mapadoc EDI was sold in August 2019, providing eight months of operating activities in 2019.

Investing activities of discontinued operations for the year ended December 31, 2019 used cash of $127,679.

The Company believes that it has adequate liquidity to fund its operating plans for at least the next twelve months from the date of issuance of these financial statements.

Cash provided by operating activities:

The Company provided $226,034 in cash for operating activities for the year ended December 31, 2021 as compared to providing $1,729,091 of cash from operating activities for the year ended December 31, 2020.

This decrease in cash provided by operations is primarily because of the increase in prepaid expenses and other current assets as a result due from a vendor in the amount of $691,680 and the increase in accounts receivable offset partially by the increase in accounts payable.

Cash (used in) provided by investing activities:

Investing activities for the year ended December 31, 2021 used cash of $510,464 as compared to providing $839,808 of cash for the year ended December 31, 2020.

This decrease in cash provided is due to proceeds received in 2020 from the sale of the Company’s EDI practice, and such payments not occurring during the year ended December 31, 2021.

This was partially offset by the proceeds received in 2021 from the sale of a product line.

In addition, for the year ended December 31, 2021 the Company spent $645,703 to acquire new businesses as compared to only $185,410 for the year ended December 31, 2020.

Cash provided by (used in) financing activities

For the year ended December 31, 2021 financing activities provided cash of $503,131 as compared to using cash of $4,631,884 for the year ended December 31, 2020.

The increase in cash provided is attributed to the received net proceeds of $4,180,904 from the sale of common stock under its Registration Statement on Form S-3 and the previously disclosed At Market Issuance Sales Agreement with a sales agent offset by lower dividend payments to shareholders.

The Company believes that it has adequate liquidity to fund its operating plans for at least the next twelve months from the date of issuance of these consolidated financial statements.

There was no significant impact on the Company’s operations because of inflation for the year ended December 31, 2021.

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Revenue Recognition

The Financial Accounting Standards Board “FASB” issued ASU 2014-09, Revenue from Contracts with Customers:

Topic 606 which superseded nearly all existing revenue recognition guidance under GAAP.

The core principle of Topic 606 is to recognize revenues when promised goods or services are transferred to customers in an amount that reflects the consideration that is expected to be received for those goods or services.

Topic 606 defines a five-step process to achieve this core principle and, in doing so, it is possible more judgment and estimates may be required within the revenue recognition process than are required under existing GAAP, including identifying performance obligations in the contract, estimating the amount of variable consideration to include in the transaction price and allocating the transaction price to each separate performance obligation, among others.

Topic 606 also provides guidance on the recognition of costs related to obtaining customer contracts.

With the adoption of ASC 606, the Company has elected the significant financing component practical expedient.

The Company has elected the significant financing component practical expedient in accordance with Accounting Standards Codification (“ASC”) Topic 606, Revenue from Contracts with Customers.

In determining the transaction price, the Company does not adjust the promised amount of consideration for the effects of a significant financing component as the Company expects, at contract inception, that the period between when the entity transfers a promised good or service to a customer and when the customer pays for that good or service will be one year or less.

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Unbilled services represent the revenue recognized but not yet invoiced.

Goodwill is the excess of acquisition cost of an acquired entity over the fair value of the identifiable net assets acquired.

Goodwill is not amortized, but tested for impairment annually or whenever indicators of impairment exist.

These indicators may include a significant change in the business climate, legal factors, operating performance indicators, competition, sale or disposition of a significant portion of the business or other factors.

Definite Lived Intangible Assets and Long-Lived Assets

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The excess of the purchase price over the fair value of assets acquired and liabilities assumed is recorded as goodwill.

Results of operations related to business combinations are included prospectively beginning with the date of acquisition and transaction costs related to business combinations are recorded within S,G&A.

The Company accounts for income taxes using the asset and liability method described in FASB ASC 740, “Income Taxes”.

27 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 5. Market for Registrant’s Common Equity