PRGX Global (PRGX) 10-Q 6 Nov 20 2020 Q3 Quarterly report Financial data

Cover

Cover - shares	9 Months Ended
	Sep. 30, 2020	Oct. 30, 2020
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Sep. 30, 2020
Document Transition Report	false
Entity File Number	0-28000
Entity Registrant Name	PRGX Global, Inc.
Entity Incorporation, State or Country Code	GA
Entity Tax Identification Number	58-2213805
Entity Address, Address Line One	600 Galleria Parkway
Entity Address, Address Line Two	Suite 100
Entity Address, City or Town	Atlanta
Entity Address, State or Province	GA
Entity Address, Postal Zip Code	30339-5986
City Area Code	770
Local Phone Number	779-3900
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false
Title of 12(b) Security	Common Stock, no par value
Trading Symbol	PRGX
Security Exchange Name	NASDAQ
Entity Common Stock, Shares Outstanding		23,561,493
Entity Central Index Key	0001007330
Amendment Flag	false
Document Fiscal Year Focus	2020
Document Fiscal Period Focus	Q3
Current Fiscal Year Focus	--12-31

Condensed Consolidated Statemen

Condensed Consolidated Statements of Operations (Unaudited) - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Income Statement [Abstract]
Revenue, net	$ 41,532	$ 42,290	$ 117,382	$ 123,068
Operating expenses:
Cost of revenue	20,813	25,539	63,931	77,086
Selling, general and administrative expenses	13,751	13,544	41,941	43,209
Depreciation of property, equipment and software assets	1,295	2,648	5,401	7,232
Amortization of intangible assets	830	864	2,487	2,598
Impairment charges	553	0	553	0
Acquisition-related adjustment income	0	(250)	0	(250)
Total operating expenses	37,242	42,345	114,313	129,875
Operating income (loss) from continuing operations	4,290	(55)	3,069	(6,807)
Foreign currency transaction losses on short-term intercompany balances	(418)	905	219	1,034
Interest expense, net	216	376	861	1,441
Other loss (income)	2	4	4	(4)
Income (loss) from continuing operations before income tax	4,490	(1,340)	1,985	(9,278)
Income tax expense	1,456	202	2,416	681
Net income (loss) from continuing operations	3,034	(1,542)	(431)	(9,959)
Discontinued operations:
Income from discontinued operations	0	900	0	642
Net income from discontinued operations	0	900	0	642
Net income (loss)	$ 3,034	$ (642)	$ (431)	$ (9,317)
Basic income (loss) per common share (Note 2):
Basic income (loss) from continuing operations (in usd per share)	$ 0.13	$ (0.07)	$ (0.02)	$ (0.44)
Basic income from discontinued operations (in usd per share)	0	0.04	0	0.03
Total basic income (loss) per share (in usd per share)	0.13	(0.03)	(0.02)	(0.41)
Diluted income (loss) per common share (Note 2):
Diluted income (loss) from continuing operations (in usd per share)	0.13	(0.07)	(0.02)	(0.44)
Diluted income from discontinued operations (in usd per share)	0	0.04	0	0.03
Total diluted income (loss) per common share (in usd per share)	$ 0.13	$ (0.03)	$ (0.02)	$ (0.41)
Weighted-average common shares outstanding (Note 2):
Basic (in shares)	22,695	22,770	22,597	22,715
Diluted (in shares)	23,018	22,770	22,597	22,715
Revenue, Product and Service [Extensible List]			us-gaap:ServiceMember

Condensed Consolidated Statem_2

Condensed Consolidated Statements of Comprehensive Income (Loss) (Unaudited) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Comprehensive Income (Loss), Net of Tax, Attributable to Parent [Abstract]
Net income (loss)	$ 3,034	$ (642)	$ (431)	$ (9,317)
Foreign currency translation adjustments, net of tax	414	(275)	(786)	(31)
Comprehensive income (loss)	$ 3,448	$ (917)	$ (1,217)	$ (9,348)

Condensed Consolidated Balance

Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
Current assets:
Cash and cash equivalents	$ 22,625	$ 14,982
Restricted cash	121	46
Receivables:
Billed	35,977	38,201
Unbilled	2,786	4,911
Net receivables	38,763	43,112
Employee advances and miscellaneous receivables, net	995	704
Total receivables	39,758	43,816
Prepaid expenses and other current assets	3,586	5,582
Total current assets	66,090	64,426
Property, equipment and software	69,832	63,557
Less accumulated depreciation and amortization	(49,266)	(45,811)
Property, equipment and software, net	20,566	17,746
Operating lease right-of-use assets (Note 9)	10,226	10,969
Goodwill	15,027	15,070
Intangible assets, less accumulated amortization of $49,369 in 2020 and $47,097 in 2019	8,963	11,506
Unbilled receivables	1,065	1,282
Deferred income taxes	3,689	3,921
Other assets	519	546
Total assets	126,145	125,466
Current liabilities:
Accounts payable and accrued expenses	4,462	4,326
Accrued payroll and related expenses	17,148	12,951
Current portion of operating lease liabilities (Note 9)	4,117	3,717
Refund liabilities	4,443	4,513
Deferred revenue	1,821	2,217
Current portion of debt (Note 5)	0	17
Total current liabilities	31,991	27,741
Long-term debt (Note 5)	30,673	36,603
Long-term operating lease liabilities (Note 9)	6,482	7,435
Refund liabilities	64	9
Deferred income taxes (Note 8)	628	628
Total liabilities	69,838	72,416
Commitments and contingencies (Note 7)
Shareholders’ equity (Note 2):
Common stock, no par value; $.01 stated value per share. Authorized 50,000,000 shares; 23,561,493 shares issued and outstanding at September 30, 2020 and 23,369,433 shares issued and outstanding at December 31, 2019	236	234
Additional paid-in capital	586,876	582,404
Accumulated deficit	(529,607)	(529,176)
Accumulated other comprehensive loss	(1,198)	(412)
Total shareholders’ equity	56,307	53,050
Total liabilities and shareholders' equity	$ 126,145	$ 125,466
Common Stock, No Par Value	$ 0	$ 0

Condensed Consolidated Balanc_2

Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
Statement of Financial Position [Abstract]
Allowances for contract receivables	$ 1,391	$ 1,781
Accumulated amortization on intangible assets	$ 49,369	$ 47,097
Common stock, stated value per share (in usd per share)	$ 0.01	$ 0.01
Common stock, shares authorized (in shares)	50,000,000	50,000,000
Common stock, shares issued (in shares)	23,561,493	23,369,433
Common stock, shares outstanding (in shares)	23,561,493	23,369,433

Condensed Consolidated Statem_3

Condensed Consolidated Statements of Shareholders' Equity (Unaudited) - USD ($) $ in Thousands	Total	Common Stock [Member]	Additional Paid-in Capital [Member]	Accumulated Deficit [Member]	Accumulated Other Comprehensive Loss [Member]
Beginning balance (in shares) at Dec. 31, 2018		23,186,258
Beginning balance at Dec. 31, 2018	$ 66,329	$ 232	$ 582,574	$ (515,456)	$ (1,021)
Increase (Decrease) in Stockholders' Equity
Net (loss) income	(9,317)			(9,317)
Foreign currency translation adjustments	(31)				(31)
Issuances of common stock:
Restricted share awards (in shares)		516,955
Restricted share awards	0	$ 5	(5)
Restricted shares remitted by employees for taxes (in shares)		(101,702)
Restricted shares remitted by employees for taxes	(760)	$ (1)	(759)
Stock option exercises (in shares)		45,380
Stock option exercises	221		221
Performance-based restricted stock unit settlement (in shares)		203,524
Performance-based restricted stock unit settlement		$ 2	(2)
Restricted stock unit settlement (in shares)		29,142
Restricted stock unit settlement	0
Forfeited restricted share awards (in shares)		(64,164)
Forfeited restricted share awards	0
Repurchase of common stock (in shares)		(612,843)
Repurchase of common stock	(4,212)	$ (6)	(4,206)
Stock-based compensation expense	3,710		3,710
Ending balance (in shares) at Sep. 30, 2019		23,202,550
Ending balance at Sep. 30, 2019	55,940	$ 232	581,533	(524,773)	(1,052)
Beginning balance (in shares) at Jun. 30, 2019		23,611,403
Beginning balance at Jun. 30, 2019	58,310	$ 236	582,982	(524,131)	(777)
Increase (Decrease) in Stockholders' Equity
Net (loss) income	(642)			(642)
Foreign currency translation adjustments	(275)				(275)
Issuances of common stock:
Restricted shares remitted by employees for taxes (in shares)		(1,817)
Restricted shares remitted by employees for taxes	(10)		(10)
Restricted stock unit settlement (in shares)		1,626
Restricted stock unit settlement	0
Forfeited restricted share awards (in shares)		(39,574)
Forfeited restricted share awards	0
Repurchase of common stock (in shares)		(369,088)
Repurchase of common stock	(1,984)	$ (4)	(1,980)
Stock-based compensation expense	541		541
Ending balance (in shares) at Sep. 30, 2019		23,202,550
Ending balance at Sep. 30, 2019	$ 55,940	$ 232	581,533	(524,773)	(1,052)
Beginning balance (in shares) at Dec. 31, 2019	23,369,433	23,369,433
Beginning balance at Dec. 31, 2019	$ 53,050	$ 234	582,404	(529,176)	(412)
Increase (Decrease) in Stockholders' Equity
Net (loss) income	(431)			(431)
Foreign currency translation adjustments	(786)				(786)
Issuances of common stock:
Restricted share awards (in shares)		429,269
Restricted share awards	0	$ 4	(4)
Restricted shares remitted by employees for taxes (in shares)		(113,072)
Restricted shares remitted by employees for taxes	(403)	$ (1)	(402)
Restricted stock unit settlement (in shares)		63,147
Restricted stock unit settlement	0	$ 1	(1)
Forfeited restricted share awards (in shares)		(83,422)
Forfeited restricted share awards	0	$ (1)	1
Repurchase of common stock (in shares)		(103,862)
Repurchase of common stock	(284)	$ (1)	(283)
Stock-based compensation expense	$ 5,161		5,161
Ending balance (in shares) at Sep. 30, 2020	23,561,493	23,561,493
Ending balance at Sep. 30, 2020	$ 56,307	$ 236	586,876	(529,607)	(1,198)
Beginning balance (in shares) at Jun. 30, 2020		23,612,686
Beginning balance at Jun. 30, 2020	50,905	$ 236	584,922	(532,641)	(1,612)
Increase (Decrease) in Stockholders' Equity
Net (loss) income	3,034			3,034
Foreign currency translation adjustments	414				414
Issuances of common stock:
Restricted shares remitted by employees for taxes (in shares)		(1,052)
Restricted shares remitted by employees for taxes	(5)		(5)
Restricted stock unit settlement (in shares)		1,626
Restricted stock unit settlement	0
Forfeited restricted share awards (in shares)		(51,767)
Forfeited restricted share awards	0
Stock-based compensation expense	$ 1,959		1,959
Ending balance (in shares) at Sep. 30, 2020	23,561,493	23,561,493
Ending balance at Sep. 30, 2020	$ 56,307	$ 236	$ 586,876	$ (529,607)	$ (1,198)

Condensed Consolidated Statem_4

Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019
Cash flows from operating activities:
Net income (loss)	$ (431)	$ (9,317)
Adjustments to reconcile net loss to net cash provided by operating activities:
Impairment charges	553	0
Depreciation and amortization	7,888	9,830
Operating lease right-of-use asset expense	3,100	3,363
Amortization of deferred loan costs	71	121
Noncash interest expense	205	707
Stock-based compensation expense	5,155	3,573
Change in fair value of contingent consideration	0	(250)
Foreign currency transaction losses on short-term intercompany balances	219	1,034
Deferred income taxes	250	4
Changes in operating assets and liabilities
Billed receivables	1,760	8,796
Unbilled receivables	2,343	551
Prepaid expenses and other current assets	1,726	(980)
Operating lease liabilities	(2,912)	(3,264)
Other assets	(30)	(60)
Accounts payable and accrued expenses	(1,405)	(4,117)
Accrued payroll and related expenses	4,216	(3,514)
Refund liabilities	19	(2,437)
Deferred revenue	(378)	(832)
Net cash provided by operating activities	22,349	3,208
Cash flows from investing activities:
Purchases of property, equipment and software, net of disposal proceeds	(8,321)	(11,679)
Net cash used in investing activities	(8,321)	(11,679)
Cash flows from financing activities:
Repayments of credit facility	(44,000)	(8,000)
Proceeds from credit facility	38,000	22,400
Payment of deferred loan costs	0	(394)
Payment of earnout liability related to business acquisitions	0	(4,229)
Restricted stock repurchased from employees for withholding taxes	(404)	(760)
Repurchases of common stock	(284)	(4,212)
Proceeds from option exercises	0	221
Net cash (used in) provided by financing activities	(6,688)	5,026
Effect of exchange rates on cash and cash equivalents	378	663
Net increase (decrease) in cash, cash equivalents and restricted cash	7,718	(2,782)
Cash, cash equivalents and restricted cash at beginning of period	15,028	14,019
Cash, cash equivalents and restricted cash at end of period	22,746	11,237
Supplemental disclosure of cash flow information:
Cash paid during the period for interest	1,014	728
Cash paid during the period for income taxes, net of refunds received	$ 1,486	$ 2,118

Basis of Presentation

Basis of Presentation	9 Months Ended
	Sep. 30, 2020
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Basis of Presentation	Basis of Presentation The accompanying Condensed Consolidated Financial Statements (Unaudited) of PRGX Global, Inc. and its wholly-owned subsidiaries have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP") for interim financial information and with the instructions for the Quarterly Report on Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three and nine-month periods ended September 30, 2020 are not necessarily indicative of the results that may be expected for the year ending December 31, 2020. Except as otherwise indicated or unless the context otherwise requires, “PRGX,” “we,” “us,” “our” and the “Company” refer to PRGX Global, Inc. and its subsidiaries. For further information, refer to the Consolidated Financial Statements and the related Notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019. Significant Accounting Policies A summary of the Company's significant accounting policies is included in Note 1 of the “Notes to Consolidated Financial Statements” contained in the Company's Annual Report on Form 10-K for the year ended December 31, 2019. The Company did not experience any significant changes during the quarter ended September 30, 2020 in any of the Critical Accounting Policies from those contained in the Company's Form 10-K for the year ended December 31, 2019. COVID-19 In December 2019, a novel strain of coronavirus was first identified, and in March 2020, the World Health Organization categorized COVID-19, the disease resulting from this coronavirus strain, as a pandemic. To help control the spread of the virus and protect the health and safety of our employees and customers, many of the Company's teams worldwide have been working remotely since the middle of March. The Company evaluates the recoverability of goodwill annually in the fourth quarter of each year or sooner if events or changes in circumstances indicate that the carrying amount may exceed its fair value. The impairment test performed in the fourth quarter of 2019 indicated significant excess fair value over carrying value for the Recovery Audit Services reporting units. The Company evaluated whether there were indicators of impairment as of September 30, 2020 as a result of COVID-19 conditions including deterioration in the macro-economic environment and the volatility in our share price. While there were negative macro-economic factors, the positive evidence outweighed the negative evidence of the fair value of our reporting units more likely than not exceeding the carrying amount of those units as of September 30, 2020. Further, since the negative financial impacts on the Company from the COVID-19 pandemic have not been significant to date, COVID-19 considerations do not significantly affect the assumptions underpinning our long-term revenue and cash flow growth rates, operating models and business strategies. Therefore, the Company did not consider the COVID-19 pandemic to require an interim quantitative goodwill impairment analysis. As a result, no impairment charges for goodwill and indefinite-lived intangible assets were recorded during the three and nine months ended September 30, 2020. The Company also evaluated its remaining assets, particularly accounts receivable. The allowance for doubtful accounts is calculated based on historical experience and various other information available. The Company also assessed incremental risks due to the COVID-19 pandemic on our customers' financial viability. The Company did not experience a significant deterioration of its accounts receivable portfolio during the quarter ended September 30, 2020. The Company will continue to monitor the collectability of its accounts receivable balances. The Company has received an immaterial amount of COVID-19-related rent concessions for certain office space leases during the nine months ended September 30, 2020. Consistent with updated guidance from the Financial Accounting Standards Board (“FASB”) in April 2020, the Company elected to treat COVID-19-related rent concessions as variable rent. While the Company is having ongoing conversations with landlords, it does not expect significant concessions for the remainder of the year. On March 27, 2020, the U.S. government enacted the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”), which among other things, provides employer payroll tax credits for wages paid to employees who are unable to work during the COVID-19 pandemic and options to defer payroll tax payments. Based on evaluation of the CARES Act, the Company is deferring qualified payroll and other tax payments as permitted by the CARES Act. The full extent of the future impact of COVID-19 on the Company’s operations is uncertain. Such events, including a prolonged or recurring outbreak, are generally outside of our control and could have a material adverse impact on our business, operating results and financial conditions in future reporting periods. Impact of Recently Issued Accounting Standards A summary of the new accounting standards issued by the FASB and included in the Accounting Standards Codification ("ASC") that apply to PRGX is included below: Adopted by the Company in Fiscal Year 2020 FASB ASU 2018-13 - In August 2018, the FASB issued Accounting Standards Update ("ASU") 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework-Changes to the Disclosure Requirements for Fair Value Measurement , which adds and modifies certain disclosure requirements for fair value measurements. Under the new guidance, entities will no longer be required to disclose the amount of and reasons for transfers between Level 1 and Level 2 of the fair value hierarchy, or valuation processes for Level 3 fair value measurements. However, public companies are required to disclose the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements, and related changes in unrealized gains and losses included in other comprehensive income. Certain provisions of the ASU must be applied retrospectively, while others must be applied prospectively. The Company adopted this ASU on January 1, 2020. The adoption of this ASU did not have a material impact on the Company's condensed consolidated financial statements. FASB ASU 2018-15 - In August 2018, the FASB issued ASU No. 2018-15, Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract , which aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software. The Company adopted this ASU prospectively on January 1, 2020. The adoption of this ASU did not have a material impact on the Company's condensed consolidated financial statements. Accounting Standards Not Yet Adopted FASB ASU 2016-13 - In June 2016, the FASB issued ASU 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments , which requires entities to record expected credit losses for certain financial instruments, including trade receivables, as an allowance that reflects the entity's current estimate of credit losses expected to be incurred. ASU 2016-13 is effective for annual periods beginning after December 15, 2022, including interim periods within those annual periods, and early adoption is permitted. The Company is currently evaluating the effect that the adoption of this standard will have on the Company's condensed consolidated financial statements. FASB ASU 2019-12 - In December 2019, the FASB issued ASU No. 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes , which simplifies accounting for income taxes, changes the accounting for certain income tax transactions and makes certain improvements to the codification. These amendments will be effective for fiscal years and interim periods within those fiscal years, beginning after December 15, 2020, with early adoption permitted. The Company is currently evaluating the new standard to determine the impact it will have on the Company’s condensed consolidated financial statements. FASB ASU 2020-04 - In March 2020, the FASB issued ASU No. 2020-04, Facilitation of the Effects of Reference Rate Reform on Financial Reporting, which provides optional expedients and exceptions for applying GAAP to contracts, hedging relationships and other transactions affected by the discontinuation of the London Interbank Offered Rate (LIBOR) and other interbank offered rates. Companies may adopt this guidance at any time but no later than December 31, 2022. The Company is currently evaluating the new standard to determine the impact it will have on the Company’s condensed consolidated financial statements.

Net Income (Loss) Per Common Sh

Net Income (Loss) Per Common Share	9 Months Ended
	Sep. 30, 2020
Earnings Per Share [Abstract]
Net Income (Loss) Per Common Share	Net Income (Loss) Per Common Share The following table sets forth the computations of basic and diluted net income (loss) per common share for the three and nine months ended September 30, 2020 and 2019 (in thousands, except per share data): Three Months Nine Months 2020 2019 2020 2019 Numerator: Net income (loss) from continuing operations $ 3,034 $ (1,542) $ (431) $ (9,959) Net income from discontinued operations $ — $ 900 $ — $ 642 Denominator: Weighted-average common shares outstanding 22,695 22,770 22,597 22,715 Effect of dilutive securities from stock-based compensation plans 323 — — — Weighted-average diluted common shares outstanding 23,018 22,770 22,597 22,715 Basic net income (loss) per common share from continuing operations $ 0.13 $ (0.07) $ (0.02) $ (0.44) Basic net income per common share from discontinued operations — 0.04 — 0.03 Total basic net income (loss) per common share $ 0.13 $ (0.03) $ (0.02) $ (0.41) Diluted income (loss) per common share from continuing operations $ 0.13 $ (0.07) $ (0.02) $ (0.44) Diluted income per common share from discontinued operations — 0.04 — 0.03 Total diluted income (loss) per common share $ 0.13 $ (0.03) $ (0.02) $ (0.41) Anti-dilutive securities excluded from diluted net income (loss) per share calculation 3,713 3,960 4,036 3,960

Stock-Based Compensation

Stock-Based Compensation	9 Months Ended
	Sep. 30, 2020
Share-based Payment Arrangement [Abstract]
Stock-Based Compensation	Stock-Based Compensation The Company has two stock-based compensation plans under which outstanding equity awards have been granted, the 2008 Equity Incentive Plan ("2008 EIP") and the 2017 Equity Incentive Compensation Plan ("2017 EICP") (collectively, the "Plans"). No additional awards may be granted under the 2008 EIP. Awards granted outside of the Plans are referred to as inducement awards. During the nine months ended September 30, 2020, equity awards were granted to non-employee directors and certain key employees. The awards included restricted stock, restricted stock units, and performance-based restricted stock units ("PBUs"). Summary of Grant Activity The following is a summary of grant activity for the nine months ended September 30, 2020 (in thousands, except number of awards): Nine Months Ended September 30, 2020 # of Awards Granted Grant Date Fair Value Restricted stock 429,269 $ 1,830 Restricted stock units 142,076 562 PBUs 659,301 2,828 1,230,646 $ 5,220 The awards granted in the nine months ended September 30, 2020 had the following terms: • 398,500 shares of the restricted stock vest over three years in approximately equal annual installments and 30,769 shares of the restricted stock vest one year from grant date. • 123,076 restricted stock units vest one year from grant date and 19,000 restricted stock units vest over three years in approximately equal annual installments. • The vesting of the PBUs is subject to the satisfaction of certain specified financial performance conditions for the two-year performance period ending on December 31, 2021. PBUs that vest will be settled in shares of the Company's common stock. Stock-based compensation expense for these PBUs is being recognized at the target level of financial performance, as if 100% of the awards will vest. The Company reevaluates this likelihood on a quarterly basis. Additional Information As of September 30, 2020, there were approximately 1.9 million shares available for future grant under the 2017 EICP. Stock-based compensation expense for the three months ended September 30, 2020 and 2019 was $2.0 million and $0.5 million, respectively, and $5.2 million and $3.6 million for the nine months ended September 30, 2020 and 2019, respectively, and is included in Selling, general and administrative expenses

Operating Segments and Related

Operating Segments and Related Information	9 Months Ended
	Sep. 30, 2020
Segment Reporting [Abstract]
Operating Segments and Related Information	Operating Segments and Related Information The Company conducts its operations through the following three reportable segments: Recovery Audit Services – Americas represents recovery audit services provided in the United States of America (“U.S.”), Canada and Latin America. Recovery Audit Services – Europe/Asia-Pacific represents recovery audit services provided in Europe, Asia and the Pacific region. Adjacent Services represents data transformation, spend analytics and associated advisory services. The unallocated portion of corporate selling, general and administrative expenses not specifically attributable to the three reportable segments is included in Corporate Support . Discontinued Operations There was no activity in the Company's discontinued operations segment for the three and nine months ended September 30, 2020. The following table presents the discontinued operations of the Healthcare Claims Recovery Audit ("HCRA") services business in the Consolidated Statements of Operations, for the three and nine months ended September 30, 2019 (in thousands): Three Months Ended September 30, Nine Months 2019 2019 Revenue, net $ — $ — Cost of sales (907) (662) Selling, general and administrative expense 7 20 Depreciation and amortization — — Income from discontinued operations before income taxes $ 900 $ 642 Income tax expense — — Net income from discontinued operations $ 900 $ 642 The following table presents the discontinued operations of the HCRA services business in the Consolidated Statements of Cash Flows, for the nine months ended September 30, 2019 (in thousands): Nine Months Ended September 30, 2019 Net cash used in operating activities $ (148) Net cash (used in) provided by investing activities — Net cash (used in) provided by financing activities — Decrease in cash and cash equivalents $ (148) The Company evaluates the performance of its reportable segments based upon revenue and measures of profit or loss referred to as EBITDA and Adjusted EBITDA. The Company defines Adjusted EBITDA as earnings from continuing operations before interest and taxes (“EBIT”), adjusted for depreciation and amortization (“EBITDA”), and then further adjusted for unusual and other significant items that management views as distorting the operating results of the various segments from period to period. Such adjustments include restructuring charges, stock-based compensation, bargain purchase gains, acquisition-related charges and benefits (acquisition transaction costs, acquisition obligations classified as compensation, and fair value adjustments to acquisition-related contingent consideration), tangible and intangible asset impairment charges, certain litigation costs and litigation settlements, certain severance charges and foreign currency transaction gains and losses on short-term intercompany balances viewed by management as individually or collectively significant. The Company does not have any inter-segment revenue. Segment information for the three and nine months ended September 30, 2020 and 2019 (in thousands) is as follows: Recovery Recovery Audit Adjacent Corporate Total Three Months Ended September 30, 2020 Revenue, net $ 28,026 $ 12,651 $ 855 $ — $ 41,532 Net income from continuing operations 3,034 Income tax expense 1,456 Interest expense, net 216 EBIT $ 10,478 $ 5,648 $ (348) $ (11,072) $ 4,706 Depreciation of property, equipment and software 1,120 162 13 — 1,295 Amortization of intangible assets 408 43 379 — 830 EBITDA $ 12,006 $ 5,853 $ 44 $ (11,072) $ 6,831 Impairment charges — — 553 — 553 Other loss — — — 2 2 Foreign currency transaction (gains) losses on short-term intercompany balances (116) (735) (9) 442 (418) Transformation, severance, and other expenses 48 199 — 175 422 Stock-based compensation — — — 1,959 1,959 Adjusted EBITDA from continuing operations $ 11,938 $ 5,317 $ 588 $ (8,494) $ 9,349 Recovery Recovery Audit Adjacent Corporate Total Three Months Ended September 30, 2019 Revenue, net $ 29,987 $ 10,803 $ 1,500 $ — $ 42,290 Net loss from continuing operations (1,542) Income tax expense 202 Interest expense, net 376 EBIT $ 6,596 $ 1,261 $ (1,027) $ (7,794) $ (964) Depreciation of property, equipment and software 2,191 176 281 — 2,648 Amortization of intangible assets 437 41 386 — 864 EBITDA $ 9,224 $ 1,478 $ (360) $ (7,794) $ 2,548 Other loss (income) 1 (1) 1 3 4 Foreign currency transaction losses (gains) on short-term intercompany balances 97 864 10 (66) 905 Transformation, severance, and other expenses 654 140 331 733 1,858 Acquisition-related adjustment income — — — (250) (250) Stock-based compensation — — — 527 527 Adjusted EBITDA from continuing operations $ 9,976 $ 2,481 $ (18) $ (6,847) $ 5,592 Recovery Audit Services – Americas Recovery Audit Services – Europe/Asia- Pacific Adjacent Services Corporate Support Total Nine Months Ended September 30, 2020 Revenue, net $ 81,211 $ 33,593 $ 2,578 $ — $ 117,382 Net loss from continuing operations (431) Income tax expense 2,416 Interest expense, net 861 EBIT $ 23,851 $ 11,513 $ (186) $ (32,332) $ 2,846 Depreciation of property, equipment and software 4,835 486 80 — 5,401 Amortization of intangible assets 1,224 126 1,137 — 2,487 EBITDA $ 29,910 $ 12,125 $ 1,031 $ (32,332) $ 10,734 Impairment charges — — 553 — 553 Other loss — — — 4 4 Foreign currency transaction losses (gains) on short-term intercompany balances 604 (613) (5) 233 219 Transformation, severance, and other expenses 1,063 588 127 623 2,401 Investigation and settlement of employment matter — — — 1,306 1,306 Stock-based compensation — — — 5,155 5,155 Adjusted EBITDA from continuing operations $ 31,577 $ 12,100 $ 1,706 $ (25,011) $ 20,372 Recovery Audit Services – Americas Recovery Audit Services – Europe/Asia- Pacific Adjacent Services Corporate Support Total Nine Months Ended September 30, 2019 Revenue, net $ 86,295 $ 32,398 $ 4,375 $ — $ 123,068 Net loss from continuing operations (9,959) Income tax expense 681 Interest expense, net 1,441 EBIT $ 19,560 $ 3,451 $ (6,086) $ (24,762) $ (7,837) Depreciation of property, equipment and software 5,872 520 840 — 7,232 Amortization of intangible assets 1,313 126 1,159 — 2,598 EBITDA $ 26,745 $ 4,097 $ (4,087) $ (24,762) $ 1,993 Other loss (income) 2 8 1 (15) (4) Foreign currency transaction (gains) losses on short-term intercompany balances (82) 1,164 10 (58) 1,034 Transformation, severance, and other expenses 1,032 385 954 1,464 3,835 Acquisition-related adjustment income — — — (250) (250) Stock-based compensation — — — 3,573 3,573 Adjusted EBITDA from continuing operations $ 27,697 $ 5,654 $ (3,122) $ (20,048) $ 10,181

Debt

Debt	9 Months Ended
	Sep. 30, 2020
Debt Disclosure [Abstract]
Debt	Debt On March 14, 2019, the Company, as co-borrower with PRGX USA, Inc. (“PRGX-USA” and, collectively with the Company, the "Borrowers"), a wholly-owned subsidiary that is the Company’s principal domestic operating subsidiary, entered into a five-year Credit Agreement (the “BOA Credit Facility”) with Bank of America, N.A. (“BOA”) and Synovus Bank as the initial lenders thereunder, and with BOA as the letter-of-credit issuer thereunder, as the swingline lender thereunder, and as the administrative agent (the “Administrative Agent”) for the lenders from time to time party thereto. The BOA Credit Facility consists of a $60.0 million senior revolving credit facility (the “Revolver”), with a $5.0 million subfacility for the issuance of letters of credit, and a $5.0 million swingline loan subfacility (the “Swingline Loan”). The BOA Credit Facility is guaranteed by each of PRGX’s direct and indirect domestic wholly-owned subsidiaries (other than PRGX-USA), except for certain immaterial domestic subsidiaries. None of PRGX’s direct or indirect foreign subsidiaries have guaranteed the BOA Credit Facility. The BOA Credit Facility is secured by substantially all of the assets of PRGX, PRGX-USA and each guarantor (including the equity interests in substantially all of the Company’s domestic subsidiaries and up to sixty-five percent (65%) of the equity interests of certain of the Company’s first-tier material foreign subsidiaries). The BOA Credit Facility will mature on March 14, 2024. Interest is payable quarterly in arrears. There are no prepayment penalties in the event the Company elects to prepay and terminate the BOA Credit Facility prior to its scheduled maturity date, subject to breakage and redeployment costs in certain limited circumstances. The Revolver bears interest at a rate per annum comprised of a specified index rate based on LIBOR plus an applicable interest rate margin determined under the BOA Credit Facility. For U.S. Dollar-denominated loans under the Revolver, at the option of the Borrowers, such loans shall bear interest at a rate per annum equal to (x) the LIBOR daily floating rate plus an applicable interest rate margin determined under the BOA Credit Facility or (y) the base rate plus the applicable interest rate margin, each as determined under the BOA Credit Facility. Although the Company does not anticipate the need for Swingline Loans, were any Swingline Loans to be made they would bear interest at the base rate plus the applicable interest rate margin for base rate loans, each as determined under the BOA Credit Facility. The applicable interest rate margin varies from 1.50% per annum to 2.25% per annum, for LIBOR daily floating rate loans, and from 0.50% per annum to 1.25% per annum, for loans based on the base rate, and in either case depending on the Company’s consolidated leverage ratio, and is determined in accordance with a pricing grid under the BOA Credit Facility. The BOA Credit Facility includes customary affirmative, negative, and financial covenants binding on the Company, including delivery of financial statements and other reports and maintenance of existence. The negative covenants limit the ability of the Company, among other things, to incur debt, incur liens, make investments and sell assets, but does provide for certain permitted repurchases of shares of its capital stock and the declaration and payment of certain dividends on its capital stock. The financial covenants included in the BOA Credit Facility set forth a maximum consolidated leverage ratio and a minimum consolidated fixed charge coverage ratio for the Company, each which will be tested on a quarterly basis; and with the Company having the ability to increase the maximum leverage ratio for a limited time when needed in connection with permitted acquisitions. In addition, the BOA Credit Facility includes customary events of default. As of September 30, 2020, there was $31.0 million in debt outstanding under the BOA Credit Facility that will be due March 14, 2024. The amount available for additional borrowing under the BOA Credit Facility was $29.0 million as of September 30, 2020. Based on the terms of the BOA Credit Facility, on September 30, 2020 the applicable interest rate (inclusive of the applicable interest rate margin) for LIBOR daily floating rate loans (the only type outstanding on September 30, 2020) was approximately 1.90%. As of September 30, 2020, the Company was required to pay a commitment fee of 0.25% per annum, payable quarterly, on the unused portion of the BOA Credit Facility. Long-term debt as of September 30, 2020 and December 31, 2019 consists of the following (in thousands): As of As of Credit facility (1) $ 31,000 $ 37,000 DFC (2) (327) (397) Net credit facility 30,673 36,603 Finance lease obligations (1) — 17 Total debt 30,673 36,620 Less: Current portion of long-term debt — 17 Long-term debt, excluding current portion $ 30,673 $ 36,603 (1) Principal portion of long-term debt. Refer to Future Commitments table below for principal payments to be made on long-term debt. (2) DFC refers to deferred financing costs related to the Company's long-term debt. Future Commitments The following is a summary of the combined principal maturities of all long-term debt and principal payments to be made under the Company’s credit facility for each of the fiscal years presented in the table below (in thousands): Year Ending December 31, 2020 $ — 2021 — 2022 — 2023 — 2024 31,000 Total $ 31,000

Fair Value of Financial Instrum

Fair Value of Financial Instruments	9 Months Ended
	Sep. 30, 2020
Fair Value Disclosures [Abstract]
Fair Value of Financial Instruments	Fair Value of Financial Instruments The Company records cash equivalents at cost, which approximates fair market value. The carrying values for receivables from clients, unbilled receivables, accounts payable, deferred revenue and other accrued liabilities reasonably approximate fair market value due to the nature of the financial instrument and the short-term maturity of these items. The Company records bank debt, if any, as of the period end date based on the effective borrowing rate and repayment terms when originated. The Company had $31.0 million in bank debt outstanding as of September 30, 2020 and $37.0 million in bank debt outstanding as of December 31, 2019. The Company believes the carrying value of the bank debt approximates its fair value. The Company considers the factors used in determining the fair value of this debt to be Level 3 inputs (significant unobservable inputs). The Company reviews the carrying value of capitalized software development costs for impairment whenever events and circumstances indicate that the carrying value of the asset may not be recoverable from the estimated future cash flows expected to result from its use and eventual disposition. In cases where undiscounted expected future cash flows are less than the carrying value, we will recognize an impairment loss equal to the amount by which the carrying value exceeds the fair value of the asset. During the third quarter of 2020, as a result of this evaluation, it was determined that previously capitalized internally developed software was impaired and was no longer expected to provide future value. Accordingly, the Company recorded an impairment charge of $0.6 million.

Commitments and Contingencies

Commitments and Contingencies	9 Months Ended
	Sep. 30, 2020
Commitments and Contingencies Disclosure [Abstract]
Commitments and Contingencies	Commitments and Contingencies Legal Proceedings The Company is party to a variety of legal proceedings arising in the normal course of business. While the results of these proceedings cannot be predicted with certainty, management believes that the final outcome of these proceedings will not have a material adverse effect on the Company's financial position, results of operations or cash flows.

Income Taxes

Income Taxes	9 Months Ended
	Sep. 30, 2020
Income Tax Disclosure [Abstract]
Income Taxes	Income Taxes Reported income tax expense in each period primarily results from taxes on the income of foreign subsidiaries. The effective tax rates generally differ from the expected tax rate due primarily to the Company’s deferred tax asset valuation allowance on the domestic earnings and taxes on income of foreign subsidiaries. Income tax expense amounts as reported in the accompanying Condensed Consolidated Financial Statements (Unaudited) do not reflect amounts that normally would be expected due to several factors. The most significant of these factors is that the Company has several subsidiaries, both domestic and foreign, that have current year and actual year-to-date losses on which the Company cannot take a tax benefit because these subsidiaries have recorded a valuation allowance against their deferred tax assets. For those subsidiaries that report income and do not have a valuation allowance, the Company is required to record income tax expense. Significant judgment is required in evaluating the Company's uncertain tax positions and determining its provision for income taxes. In addition, the Company is subject to the continuous examination of its income tax returns by the Internal Revenue Service in the U.S. and other tax authorities. The Company regularly assesses the likelihood of adverse outcomes resulting from these examinations to determine the adequacy of its provision for income taxes. The Company applies a “more-likely-than-not” recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. PRGX refers to GAAP for guidance on derecognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition. In accordance with FASB ASC 740, the Company's policy for recording interest and penalties associated with tax positions is to record such items as a component of income before income taxes. A number of years may elapse before a tax position is audited and finally resolved or when a tax assessment is raised. The number of years subject to tax assessments also varies by tax jurisdiction.

Leases

Leases	9 Months Ended
	Sep. 30, 2020
Leases [Abstract]
Leases	Leases The Company primarily leases office space and certain office equipment using noncancelable operating leases. Operating lease right-of-use assets and liabilities are recognized at the commencement date based on the present value of lease payments over the lease term. As the implicit rate is not readily determinable in most of the Company's lease agreements, the Company uses its estimated secured incremental borrowing rate, which takes into consideration the relevant term of the underlying lease, in determining the present value of lease payments. Lease expense is recognized on a straight-line basis over the lease terms. Certain of our lease agreements include variable lease payments, primarily related to common area maintenance, insurance and taxes. The variable portion of payments is not included in the initial measurement of the right-of-use asset or lease liability due to the uncertainty of the payment amount and are recorded as lease expense in the period incurred. The Company's leases have original lease periods expiring between 2020 and 2027, which may include the option to extend the lease when it is reasonably certain the Company will exercise that option. The Company does not have lease agreements with residual value guarantees, sale leaseback terms or material restrictive covenants. The components of lease expense, lease term and discount rate are as follows (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Operating lease cost $ 1,100 $ 1,168 $ 3,287 $ 3,616 Short-term lease cost 17 30 51 72 Variable lease cost 314 387 686 841 Sublease income (12) (20) (48) (55) Total lease cost $ 1,419 $ 1,565 $ 3,976 $ 4,474 As of September 30, 2020 and December 31, 2019, the weighted average remaining lease term and weighted average discount rate for the Company's operating leases were as follows: September 30, 2020 December 31, 2019 Weighted Average Remaining Lease Term 3.5 years 3.5 years Weighted Average Discount Rate 3.5 % 4.1 % The following is a schedule, by years, of maturities of lease liabilities as of September 30, 2020 (in thousands): Operating Leases The remainder of 2020 $ 1,116 2021 4,304 2022 2,262 2023 1,562 2024 1,140 Thereafter 840 Total undiscounted cash flows 11,224 Less imputed interest (625) Present value of lease liabilities $ 10,599 Supplemental cash flow information related to the Company's operating leases are as follows (in thousands): Nine Months 2020 2019 Non-cash activity: Right-of-use assets obtained in exchange for operating lease obligations $ 2,358 $ 14,479 Operating cash flows: Cash paid for amounts included in the measurement of lease liabilities $ 3,324 $ 3,322

Basis of Presentation (Policies

Basis of Presentation (Policies)	9 Months Ended
	Sep. 30, 2020
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Impact of Recently Issued Accounting Standards	Impact of Recently Issued Accounting Standards A summary of the new accounting standards issued by the FASB and included in the Accounting Standards Codification ("ASC") that apply to PRGX is included below: Adopted by the Company in Fiscal Year 2020 FASB ASU 2018-13 - In August 2018, the FASB issued Accounting Standards Update ("ASU") 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework-Changes to the Disclosure Requirements for Fair Value Measurement , which adds and modifies certain disclosure requirements for fair value measurements. Under the new guidance, entities will no longer be required to disclose the amount of and reasons for transfers between Level 1 and Level 2 of the fair value hierarchy, or valuation processes for Level 3 fair value measurements. However, public companies are required to disclose the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements, and related changes in unrealized gains and losses included in other comprehensive income. Certain provisions of the ASU must be applied retrospectively, while others must be applied prospectively. The Company adopted this ASU on January 1, 2020. The adoption of this ASU did not have a material impact on the Company's condensed consolidated financial statements. FASB ASU 2018-15 - In August 2018, the FASB issued ASU No. 2018-15, Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract , which aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software. The Company adopted this ASU prospectively on January 1, 2020. The adoption of this ASU did not have a material impact on the Company's condensed consolidated financial statements. Accounting Standards Not Yet Adopted FASB ASU 2016-13 - In June 2016, the FASB issued ASU 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments , which requires entities to record expected credit losses for certain financial instruments, including trade receivables, as an allowance that reflects the entity's current estimate of credit losses expected to be incurred. ASU 2016-13 is effective for annual periods beginning after December 15, 2022, including interim periods within those annual periods, and early adoption is permitted. The Company is currently evaluating the effect that the adoption of this standard will have on the Company's condensed consolidated financial statements. FASB ASU 2019-12 - In December 2019, the FASB issued ASU No. 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes , which simplifies accounting for income taxes, changes the accounting for certain income tax transactions and makes certain improvements to the codification. These amendments will be effective for fiscal years and interim periods within those fiscal years, beginning after December 15, 2020, with early adoption permitted. The Company is currently evaluating the new standard to determine the impact it will have on the Company’s condensed consolidated financial statements. FASB ASU 2020-04 - In March 2020, the FASB issued ASU No. 2020-04, Facilitation of the Effects of Reference Rate Reform on Financial Reporting, which provides optional expedients and exceptions for applying GAAP to contracts, hedging relationships and other transactions affected by the discontinuation of the London Interbank Offered Rate (LIBOR) and other interbank offered rates. Companies may adopt this guidance at any time but no later than December 31, 2022. The Company is currently evaluating the new standard to determine the impact it will have on the Company’s condensed consolidated financial statements.
Fair value of financial instruments	Fair Value of Financial Instruments The Company records cash equivalents at cost, which approximates fair market value. The carrying values for receivables from clients, unbilled receivables, accounts payable, deferred revenue and other accrued liabilities reasonably approximate fair market value due to the nature of the financial instrument and the short-term maturity of these items. The Company records bank debt, if any, as of the period end date based on the effective borrowing rate and repayment terms when originated. The Company had $31.0 million in bank debt outstanding as of September 30, 2020 and $37.0 million in bank debt outstanding as of December 31, 2019. The Company believes the carrying value of the bank debt approximates its fair value. The Company considers the factors used in determining the fair value of this debt to be Level 3 inputs (significant unobservable inputs). The Company reviews the carrying value of capitalized software development costs for impairment whenever events and circumstances indicate that the carrying value of the asset may not be recoverable from the estimated future cash flows expected to result from its use and eventual disposition. In cases where undiscounted expected future cash flows are less than the carrying value, we will recognize an impairment loss equal to the amount by which the carrying value exceeds the fair value of the asset. During the third quarter of 2020, as a result of this evaluation, it was determined that previously capitalized internally developed software was impaired and was no longer expected to provide future value. Accordingly, the Company recorded an impairment charge of $0.6 million.
Income Taxes	Income Taxes Reported income tax expense in each period primarily results from taxes on the income of foreign subsidiaries. The effective tax rates generally differ from the expected tax rate due primarily to the Company’s deferred tax asset valuation allowance on the domestic earnings and taxes on income of foreign subsidiaries. Income tax expense amounts as reported in the accompanying Condensed Consolidated Financial Statements (Unaudited) do not reflect amounts that normally would be expected due to several factors. The most significant of these factors is that the Company has several subsidiaries, both domestic and foreign, that have current year and actual year-to-date losses on which the Company cannot take a tax benefit because these subsidiaries have recorded a valuation allowance against their deferred tax assets. For those subsidiaries that report income and do not have a valuation allowance, the Company is required to record income tax expense. Significant judgment is required in evaluating the Company's uncertain tax positions and determining its provision for income taxes. In addition, the Company is subject to the continuous examination of its income tax returns by the Internal Revenue Service in the U.S. and other tax authorities. The Company regularly assesses the likelihood of adverse outcomes resulting from these examinations to determine the adequacy of its provision for income taxes. The Company applies a “more-likely-than-not” recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. PRGX refers to GAAP for guidance on derecognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition. In accordance with FASB ASC 740, the Company's policy for recording interest and penalties associated with tax positions is to record such items as a component of income before income taxes. A number of years may elapse before a tax position is audited and finally resolved or when a tax assessment is raised. The number of years subject to tax assessments also varies by tax jurisdiction.

Net Income (Loss) Per Common _2

Net Income (Loss) Per Common Share (Tables)	9 Months Ended
	Sep. 30, 2020
Earnings Per Share [Abstract]
Computations of basic and diluted earnings (loss) per common share	The following table sets forth the computations of basic and diluted net income (loss) per common share for the three and nine months ended September 30, 2020 and 2019 (in thousands, except per share data): Three Months Nine Months 2020 2019 2020 2019 Numerator: Net income (loss) from continuing operations $ 3,034 $ (1,542) $ (431) $ (9,959) Net income from discontinued operations $ — $ 900 $ — $ 642 Denominator: Weighted-average common shares outstanding 22,695 22,770 22,597 22,715 Effect of dilutive securities from stock-based compensation plans 323 — — — Weighted-average diluted common shares outstanding 23,018 22,770 22,597 22,715 Basic net income (loss) per common share from continuing operations $ 0.13 $ (0.07) $ (0.02) $ (0.44) Basic net income per common share from discontinued operations — 0.04 — 0.03 Total basic net income (loss) per common share $ 0.13 $ (0.03) $ (0.02) $ (0.41) Diluted income (loss) per common share from continuing operations $ 0.13 $ (0.07) $ (0.02) $ (0.44) Diluted income per common share from discontinued operations — 0.04 — 0.03 Total diluted income (loss) per common share $ 0.13 $ (0.03) $ (0.02) $ (0.41) Anti-dilutive securities excluded from diluted net income (loss) per share calculation 3,713 3,960 4,036 3,960

Stock-Based Compensation (Table

Stock-Based Compensation (Tables)	9 Months Ended
	Sep. 30, 2020
Share-based Payment Arrangement [Abstract]
Share-based Compensation, Activity	The following is a summary of grant activity for the nine months ended September 30, 2020 (in thousands, except number of awards): Nine Months Ended September 30, 2020 # of Awards Granted Grant Date Fair Value Restricted stock 429,269 $ 1,830 Restricted stock units 142,076 562 PBUs 659,301 2,828 1,230,646 $ 5,220

Operating Segments and Relate_2

Operating Segments and Related Information (Tables)	9 Months Ended
	Sep. 30, 2020
Segment Reporting [Abstract]
Schedule of discontinued operations information	The following table presents the discontinued operations of the Healthcare Claims Recovery Audit ("HCRA") services business in the Consolidated Statements of Operations, for the three and nine months ended September 30, 2019 (in thousands): Three Months Ended September 30, Nine Months 2019 2019 Revenue, net $ — $ — Cost of sales (907) (662) Selling, general and administrative expense 7 20 Depreciation and amortization — — Income from discontinued operations before income taxes $ 900 $ 642 Income tax expense — — Net income from discontinued operations $ 900 $ 642 The following table presents the discontinued operations of the HCRA services business in the Consolidated Statements of Cash Flows, for the nine months ended September 30, 2019 (in thousands): Nine Months Ended September 30, 2019 Net cash used in operating activities $ (148) Net cash (used in) provided by investing activities — Net cash (used in) provided by financing activities — Decrease in cash and cash equivalents $ (148)
Segment information	Segment information for the three and nine months ended September 30, 2020 and 2019 (in thousands) is as follows: Recovery Recovery Audit Adjacent Corporate Total Three Months Ended September 30, 2020 Revenue, net $ 28,026 $ 12,651 $ 855 $ — $ 41,532 Net income from continuing operations 3,034 Income tax expense 1,456 Interest expense, net 216 EBIT $ 10,478 $ 5,648 $ (348) $ (11,072) $ 4,706 Depreciation of property, equipment and software 1,120 162 13 — 1,295 Amortization of intangible assets 408 43 379 — 830 EBITDA $ 12,006 $ 5,853 $ 44 $ (11,072) $ 6,831 Impairment charges — — 553 — 553 Other loss — — — 2 2 Foreign currency transaction (gains) losses on short-term intercompany balances (116) (735) (9) 442 (418) Transformation, severance, and other expenses 48 199 — 175 422 Stock-based compensation — — — 1,959 1,959 Adjusted EBITDA from continuing operations $ 11,938 $ 5,317 $ 588 $ (8,494) $ 9,349 Recovery Recovery Audit Adjacent Corporate Total Three Months Ended September 30, 2019 Revenue, net $ 29,987 $ 10,803 $ 1,500 $ — $ 42,290 Net loss from continuing operations (1,542) Income tax expense 202 Interest expense, net 376 EBIT $ 6,596 $ 1,261 $ (1,027) $ (7,794) $ (964) Depreciation of property, equipment and software 2,191 176 281 — 2,648 Amortization of intangible assets 437 41 386 — 864 EBITDA $ 9,224 $ 1,478 $ (360) $ (7,794) $ 2,548 Other loss (income) 1 (1) 1 3 4 Foreign currency transaction losses (gains) on short-term intercompany balances 97 864 10 (66) 905 Transformation, severance, and other expenses 654 140 331 733 1,858 Acquisition-related adjustment income — — — (250) (250) Stock-based compensation — — — 527 527 Adjusted EBITDA from continuing operations $ 9,976 $ 2,481 $ (18) $ (6,847) $ 5,592 Recovery Audit Services – Americas Recovery Audit Services – Europe/Asia- Pacific Adjacent Services Corporate Support Total Nine Months Ended September 30, 2020 Revenue, net $ 81,211 $ 33,593 $ 2,578 $ — $ 117,382 Net loss from continuing operations (431) Income tax expense 2,416 Interest expense, net 861 EBIT $ 23,851 $ 11,513 $ (186) $ (32,332) $ 2,846 Depreciation of property, equipment and software 4,835 486 80 — 5,401 Amortization of intangible assets 1,224 126 1,137 — 2,487 EBITDA $ 29,910 $ 12,125 $ 1,031 $ (32,332) $ 10,734 Impairment charges — — 553 — 553 Other loss — — — 4 4 Foreign currency transaction losses (gains) on short-term intercompany balances 604 (613) (5) 233 219 Transformation, severance, and other expenses 1,063 588 127 623 2,401 Investigation and settlement of employment matter — — — 1,306 1,306 Stock-based compensation — — — 5,155 5,155 Adjusted EBITDA from continuing operations $ 31,577 $ 12,100 $ 1,706 $ (25,011) $ 20,372 Recovery Audit Services – Americas Recovery Audit Services – Europe/Asia- Pacific Adjacent Services Corporate Support Total Nine Months Ended September 30, 2019 Revenue, net $ 86,295 $ 32,398 $ 4,375 $ — $ 123,068 Net loss from continuing operations (9,959) Income tax expense 681 Interest expense, net 1,441 EBIT $ 19,560 $ 3,451 $ (6,086) $ (24,762) $ (7,837) Depreciation of property, equipment and software 5,872 520 840 — 7,232 Amortization of intangible assets 1,313 126 1,159 — 2,598 EBITDA $ 26,745 $ 4,097 $ (4,087) $ (24,762) $ 1,993 Other loss (income) 2 8 1 (15) (4) Foreign currency transaction (gains) losses on short-term intercompany balances (82) 1,164 10 (58) 1,034 Transformation, severance, and other expenses 1,032 385 954 1,464 3,835 Acquisition-related adjustment income — — — (250) (250) Stock-based compensation — — — 3,573 3,573 Adjusted EBITDA from continuing operations $ 27,697 $ 5,654 $ (3,122) $ (20,048) $ 10,181

Debt (Tables)

Debt (Tables)	9 Months Ended
	Sep. 30, 2020
Debt Disclosure [Abstract]
Schedule of Long-term Debt Instruments	Long-term debt as of September 30, 2020 and December 31, 2019 consists of the following (in thousands): As of As of Credit facility (1) $ 31,000 $ 37,000 DFC (2) (327) (397) Net credit facility 30,673 36,603 Finance lease obligations (1) — 17 Total debt 30,673 36,620 Less: Current portion of long-term debt — 17 Long-term debt, excluding current portion $ 30,673 $ 36,603 (1) Principal portion of long-term debt. Refer to Future Commitments table below for principal payments to be made on long-term debt. (2) DFC refers to deferred financing costs related to the Company's long-term debt.
Schedule of Maturities of Long-term Debt	The following is a summary of the combined principal maturities of all long-term debt and principal payments to be made under the Company’s credit facility for each of the fiscal years presented in the table below (in thousands): Year Ending December 31, 2020 $ — 2021 — 2022 — 2023 — 2024 31,000 Total $ 31,000

Leases (Tables)

Leases (Tables)	9 Months Ended
	Sep. 30, 2020
Leases [Abstract]
Components of Lease Expense, Lease Term and Discount Rate	The components of lease expense, lease term and discount rate are as follows (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Operating lease cost $ 1,100 $ 1,168 $ 3,287 $ 3,616 Short-term lease cost 17 30 51 72 Variable lease cost 314 387 686 841 Sublease income (12) (20) (48) (55) Total lease cost $ 1,419 $ 1,565 $ 3,976 $ 4,474
Weighted Average Remaining Lease Term and Weighted Average Discount Rate	As of September 30, 2020 and December 31, 2019, the weighted average remaining lease term and weighted average discount rate for the Company's operating leases were as follows: September 30, 2020 December 31, 2019 Weighted Average Remaining Lease Term 3.5 years 3.5 years Weighted Average Discount Rate 3.5 % 4.1 %
Maturity of Lease Liabilities	The following is a schedule, by years, of maturities of lease liabilities as of September 30, 2020 (in thousands): Operating Leases The remainder of 2020 $ 1,116 2021 4,304 2022 2,262 2023 1,562 2024 1,140 Thereafter 840 Total undiscounted cash flows 11,224 Less imputed interest (625) Present value of lease liabilities $ 10,599
Supplemental Cash Flow Information	Supplemental cash flow information related to the Company's operating leases are as follows (in thousands): Nine Months 2020 2019 Non-cash activity: Right-of-use assets obtained in exchange for operating lease obligations $ 2,358 $ 14,479 Operating cash flows: Cash paid for amounts included in the measurement of lease liabilities $ 3,324 $ 3,322

Basis of Presentation Basis of

Basis of Presentation Basis of Presentation (Details) - USD ($)	3 Months Ended	9 Months Ended
	Sep. 30, 2020	Sep. 30, 2020
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Goodwill and intangible asset impairment	$ 0	$ 0

Net Income (Loss) Per Common _3

Net Income (Loss) Per Common Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Numerator:
Net income (loss) from continuing operations	$ 3,034	$ (1,542)	$ (431)	$ (9,959)
Net income from discontinued operations	$ 0	$ 900	$ 0	$ 642
Denominator:
Weighted-average common shares outstanding	22,695	22,770	22,597	22,715
Effect of dilutive securities from stock-based compensation plans	323	0	0	0
Weighted-average diluted common shares outstanding	23,018	22,770	22,597	22,715
Basic net income (loss) per common share from continuing operations (in usd per share)	$ 0.13	$ (0.07)	$ (0.02)	$ (0.44)
Basic net loss per common share from discontinued operations (in usd per share)	0	0.04	0	0.03
Total basic income (loss) per share (in usd per share)	0.13	(0.03)	(0.02)	(0.41)
Diluted income (loss) per common share from continuing operations (in usd per share)	0.13	(0.07)	(0.02)	(0.44)
Diluted income per common share from discontinued operations (in usd per share)	0	0.04	0	0.03
Total diluted income (loss) per common share (in usd per share)	$ 0.13	$ (0.03)	$ (0.02)	$ (0.41)
Anti-dilutive securities excluded from diluted net loss per share calculation (in shares)	3,713	3,960	4,036	3,960

Stock-Based Compensation - Narr

Stock-Based Compensation - Narrative (Details) shares in Millions, $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2020USD ($)shares	Sep. 30, 2019USD ($)	Sep. 30, 2020USD ($)compensation_planshares	Sep. 30, 2019USD ($)
Share-based Payment Arrangement [Abstract]
Number of stock-based compensation plans | compensation_plan			2
Shares available for grant (in shares) | shares	1.9		1.9
Compensation expense	$ 2	$ 0.5	$ 5.2	$ 3.6
Nonvested awards compensation costs not yet recognized	$ 7		$ 7
Nonvested awards, compensation costs not yet recognized, period for recognition			1 year 6 months

Stock-Based Compensation Stock-

Stock-Based Compensation Stock-Based Compensation Grant Date Fair Value (Details) $ in Thousands	9 Months Ended
	Sep. 30, 2020USD ($)shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Equity grants in period (in shares)	1,230,646
Equity grants in period, grant date fair value | $	$ 5,220
Restricted Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grants other than options (in shares)	429,269
Grants other than options, grant date fair value | $	$ 1,830
Restricted Stock [Member] | Vesting over Three Years
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grants other than options (in shares)	398,500
Vesting period	3 years
Restricted Stock [Member] | Vesting over One Year
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grants other than options (in shares)	30,769
Vesting period	1 year
Restricted Stock Units (RSUs) [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grants other than options (in shares)	142,076
Grants other than options, grant date fair value | $	$ 562
Restricted Stock Units (RSUs) [Member] | Vesting over Three Years
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grants other than options (in shares)	19,000
Vesting period	3 years
Restricted Stock Units (RSUs) [Member] | Vesting over One Year
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grants other than options (in shares)	123,076
Vesting period	1 year
Performance-Based Restricted Stock Units [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grants other than options (in shares)	659,301
Grants other than options, grant date fair value | $	$ 2,828
Vesting period	2 years
Target percent for PBU's used to calculate stock compensation expense (percent)	100.00%

Operating Segments and Relate_3

Operating Segments and Related Information - Narrative (Details)	9 Months Ended
	Sep. 30, 2020segment
Segment Reporting [Abstract]
Number of reportable segments	3

Operating Segments and Relate_4

Operating Segments and Related Information - Results of Discontinued Operations (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Segment Reporting [Abstract]
Revenue, net		$ 0		$ 0
Cost of sales		(907)		(662)
Selling, general and administrative expense		7		20
Depreciation and amortization		0		0
Income from discontinued operations before income taxes	$ 0	900	$ 0	642
Income tax expense		0		0
Net income from discontinued operations		$ 900		$ 642

Operating Segments and Relate_5

Operating Segments and Related Information Operating Segments and Related Information - Discontinued Statement of Cash Flows (Details) $ in Thousands	9 Months Ended
	Sep. 30, 2019USD ($)
Segment Reporting [Abstract]
Net cash used in operating activities	$ (148)
Net cash (used in) provided by investing activities	0
Net cash (used in) provided by financing activities	0
Decrease in cash and cash equivalents	$ (148)

Operating Segments and Relate_6

Operating Segments and Related Information (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Segment information
Revenue, net	$ 41,532	$ 42,290	$ 117,382	$ 123,068
Net income (loss) from continuing operations	3,034	(1,542)	(431)	(9,959)
Income tax expense	1,456	202	2,416	681
Interest expense, net	216	376	861	1,441
EBIT	4,706	(964)	2,846	(7,837)
Depreciation of property, equipment and software	1,295	2,648	5,401	7,232
Amortization of intangible assets	830	864	2,487	2,598
EBITDA	6,831	2,548	10,734	1,993
Impairment charges	553	0	553	0
Other loss (income)	2	4	4	(4)
Foreign currency transaction (gains) losses on short-term intercompany balances	(418)	905	219	1,034
Transformation, severance, and other expenses	422	1,858	2,401	3,835
Acquisition-related adjustment income	0	(250)	0	(250)
Investigation and settlement of employment matter			1,306
Stock-based compensation	1,959	527	5,155	3,573
Adjusted EBITDA from continuing operations	9,349	5,592	20,372	10,181
Recovery Audit Services - Americas [Member]
Segment information
Revenue, net	28,026	29,987	81,211	86,295
EBIT	10,478	6,596	23,851	19,560
Depreciation of property, equipment and software	1,120	2,191	4,835	5,872
Amortization of intangible assets	408	437	1,224	1,313
EBITDA	12,006	9,224	29,910	26,745
Impairment charges	0		0
Other loss (income)	0	1	0	2
Foreign currency transaction (gains) losses on short-term intercompany balances	(116)	97	604	(82)
Transformation, severance, and other expenses	48	654	1,063	1,032
Acquisition-related adjustment income		0		0
Investigation and settlement of employment matter			0
Stock-based compensation	0	0	0	0
Adjusted EBITDA from continuing operations	11,938	9,976	31,577	27,697
Recovery Audit Services - Europe/Asia-Pacific [Member]
Segment information
Revenue, net	12,651	10,803	33,593	32,398
EBIT	5,648	1,261	11,513	3,451
Depreciation of property, equipment and software	162	176	486	520
Amortization of intangible assets	43	41	126	126
EBITDA	5,853	1,478	12,125	4,097
Impairment charges	0		0
Other loss (income)	0	(1)	0	8
Foreign currency transaction (gains) losses on short-term intercompany balances	(735)	864	(613)	1,164
Transformation, severance, and other expenses	199	140	588	385
Acquisition-related adjustment income		0		0
Investigation and settlement of employment matter			0
Stock-based compensation	0	0	0	0
Adjusted EBITDA from continuing operations	5,317	2,481	12,100	5,654
Adjacent Services [Member]
Segment information
Revenue, net	855	1,500	2,578	4,375
EBIT	(348)	(1,027)	(186)	(6,086)
Depreciation of property, equipment and software	13	281	80	840
Amortization of intangible assets	379	386	1,137	1,159
EBITDA	44	(360)	1,031	(4,087)
Impairment charges	553		553
Other loss (income)	0	1	0	1
Foreign currency transaction (gains) losses on short-term intercompany balances	(9)	10	(5)	10
Transformation, severance, and other expenses	0	331	127	954
Acquisition-related adjustment income		0		0
Investigation and settlement of employment matter			0
Stock-based compensation	0	0	0	0
Adjusted EBITDA from continuing operations	588	(18)	1,706	(3,122)
Corporate Support [Member]
Segment information
Revenue, net	0	0	0	0
EBIT	(11,072)	(7,794)	(32,332)	(24,762)
Depreciation of property, equipment and software	0	0	0	0
Amortization of intangible assets	0	0	0	0
EBITDA	(11,072)	(7,794)	(32,332)	(24,762)
Impairment charges	0		0
Other loss (income)	2	3	4	(15)
Foreign currency transaction (gains) losses on short-term intercompany balances	442	(66)	233	(58)
Transformation, severance, and other expenses	175	733	623	1,464
Acquisition-related adjustment income		(250)		(250)
Investigation and settlement of employment matter			1,306
Stock-based compensation	1,959	527	5,155	3,573
Adjusted EBITDA from continuing operations	$ (8,494)	$ (6,847)	$ (25,011)	$ (20,048)

Debt (Narrative) (Details)

Debt (Narrative) (Details) - USD ($)	Mar. 14, 2019	Sep. 30, 2020	Dec. 31, 2019
Line of Credit Facility [Line Items]
Amount of line of credit outstanding		$ 30,673,000	$ 36,603,000
Revolving Credit Facility [Member] | Line of Credit [Member] | Bank Of America [Member]
Line of Credit Facility [Line Items]
Credit facility, term	5 years
Maximum borrowing capacity of credit facility	$ 60,000,000
Stated interest rate (percent)		1.90%
Amount of line of credit outstanding		$ 31,000,000
Remaining borrowing capacity		$ 29,000,000
Commitment fee (percent)		0.25%
Bridge Loan [Member] | Line of Credit [Member] | Bank Of America [Member]
Line of Credit Facility [Line Items]
Maximum borrowing capacity of credit facility	$ 5,000,000
Debt instrument secured, equity interest (percent)	65.00%
Letter of Credit [Member] | Line of Credit [Member] | Bank Of America [Member]
Line of Credit Facility [Line Items]
Maximum borrowing capacity of credit facility	$ 5,000,000
Minimum [Member] | Senior Notes [Member]
Line of Credit Facility [Line Items]
Stated interest rate (percent)	1.50%
Minimum [Member] | Base Rate [Member] | Senior Notes [Member]
Line of Credit Facility [Line Items]
Stated interest rate (percent)	0.50%
Maximum [Member] | London Interbank Offered Rate (LIBOR) [Member] | Senior Notes [Member]
Line of Credit Facility [Line Items]
Stated interest rate (percent)	2.25%
Maximum [Member] | Base Rate [Member] | Senior Notes [Member]
Line of Credit Facility [Line Items]
Stated interest rate (percent)	1.25%

Debt (Schedule of Debt) (Detail

Debt (Schedule of Debt) (Details) - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
Debt Instrument [Line Items]
Credit facility	$ 31,000
Net credit facility	30,673	$ 36,620
Current portion of debt	0	17
Long-term debt, excluding current portion	30,673	36,603
Revolving Credit Facility [Member]
Debt Instrument [Line Items]
Credit facility	31,000	37,000
DFC	(327)	(397)
Net credit facility	30,673	36,603
Finance Lease Obligations [Member]
Debt Instrument [Line Items]
Net credit facility	$ 0	$ 17

Debt (Future Minimum Liabilitie

Debt (Future Minimum Liabilities) (Details) $ in Thousands	Sep. 30, 2020USD ($)
Debt Disclosure [Abstract]
2020	$ 0
2021	0
2022	0
2023	0
2024	31,000
Total	$ 31,000

Fair Value of Financial Instr_2

Fair Value of Financial Instruments (Details) - USD ($) $ in Millions	3 Months Ended
	Sep. 30, 2020	Dec. 31, 2019
Fair Value of Financial Instruments (Textual) [Abstract]
Impairment of internally developed software	$ 0.6
Bank Loan Obligations [Member]
Fair Value of Financial Instruments (Textual) [Abstract]
Fair value of long term debt	$ 31	$ 37

Leases - Components of Lease Ex

Leases - Components of Lease Expense, Lease Term and Discount Rate (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019	Dec. 31, 2019
Leases [Abstract]
Operating lease cost	$ 1,100	$ 1,168	$ 3,287	$ 3,616
Short-term lease cost	17	30	51	72
Variable lease cost	314	387	686	841
Sublease income	(12)	(20)	(48)	(55)
Total lease cost	$ 1,419	$ 1,565	$ 3,976	$ 4,474
Weighted Average Remaining Lease Term	3 years 6 months		3 years 6 months		3 years 6 months
Weighted Average Discount Rate	3.50%		3.50%		4.10%

Leases - Operating Lease, Matur

Leases - Operating Lease, Maturity of Lease Liabilities (Details) $ in Thousands	Sep. 30, 2020USD ($)
Leases [Abstract]
The remainder of 2020	$ 1,116
2021	4,304
2022	2,262
2023	1,562
2024	1,140
Thereafter	840
Total undiscounted cash flows	11,224
Less imputed interest	(625)
Present value of lease liabilities	$ 10,599

Leases - Supplemental Cash Flow

Leases - Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019
Non-cash activity:
Right-of-use assets obtained in exchange for operating lease obligations	$ 2,358	$ 14,479
Operating cash flows:
Cash paid for amounts included in the measurement of lease liabilities	$ 3,324	$ 3,322