Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Jun. 30, 2017 | Aug. 11, 2017 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | NATIONAL HOLDINGS CORP | |
Trading Symbol | NHLD | |
Entity Central Index Key | 1,023,844 | |
Current Fiscal Year End Date | --09-30 | |
Entity Filer Category | Non-accelerated Filer | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2017 | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false | |
Entity Common Stock, Shares Outstanding | 12,437,916 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Financial Condition - USD ($) $ in Thousands | Jun. 30, 2017 | Sep. 30, 2016 |
ASSETS | ||
Cash | $ 28,205 | $ 21,694 |
Restricted cash | 1,380 | 354 |
Cash deposits with clearing organizations | 1,040 | 1,030 |
Securities owned, at fair value | 1,595 | 2,357 |
Receivables from broker-dealers and clearing organizations | 2,786 | 3,357 |
Forgivable loans receivable | 1,269 | 1,712 |
Other receivables, net | 4,748 | 5,430 |
Prepaid expenses | 1,155 | 1,910 |
Fixed assets, net | 2,192 | 1,164 |
Intangible assets, net | 5,119 | 5,704 |
Goodwill | 6,226 | 6,531 |
Deferred tax asset, net | 8,566 | 8,958 |
Other assets, principally refundable deposits | 339 | 345 |
Total Assets | 64,620 | 60,546 |
Liabilities | ||
Securities sold, but not yet purchased, at fair value | 0 | 298 |
Accrued commissions and payroll payable | 11,255 | 11,940 |
Accounts payable and accrued expenses | 8,508 | 7,166 |
Deferred clearing and marketing credits | 838 | 995 |
Warrants issued in 2017 and issuable in 2016 | 8,832 | 14,055 |
Other | 193 | 319 |
Total Liabilities | 29,626 | 34,773 |
Stockholders’ Equity | ||
Preferred stock, $0.01 par value, 10,000,000 shares authorized; none outstanding | 0 | 0 |
Common stock $0.02 par value, authorized 75,000,000 shares at June 30, 2017 and 150,000,000 shares at September 30, 2016; 12,437,916 shares issued and outstanding at June 30, 2017 and September 30, 2016 | 248 | 248 |
Additional paid-in-capital | 66,665 | 66,353 |
Accumulated deficit | (31,934) | (40,843) |
Total National Holdings Corporation Stockholders’ Equity | 34,979 | 25,758 |
Non-Controlling interest | 15 | 15 |
Total Stockholders’ Equity | 34,994 | 25,773 |
Total Liabilities and Stockholders’ Equity | $ 64,620 | $ 60,546 |
Condensed Consolidated Stateme3
Condensed Consolidated Statements of Financial Condition (Parenthetical) - $ / shares | Jun. 30, 2017 | Sep. 30, 2016 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (in shares) | 10,000,000 | 10,000,000 |
Preferred stock, outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.02 | $ 0.02 |
Common stock, shares authorized (in shares) | 75,000,000 | 150,000,000 |
Common stock, shares issued (in shares) | 12,437,916 | 12,437,916 |
Common stock, shares outstanding (in shares) | 12,437,916 | 12,437,916 |
Condensed Consolidated Stateme4
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Revenues | ||||
Commissions | $ 24,881 | $ 25,051 | $ 73,380 | $ 71,722 |
Net dealer inventory gains | 1,789 | 2,340 | 6,666 | 7,483 |
Investment banking | 12,623 | 10,735 | 38,532 | 22,921 |
Investment advisory | 3,604 | 3,361 | 10,480 | 10,337 |
Interest and dividends | 675 | 702 | 2,065 | 2,415 |
Transaction fees and clearing services | 1,649 | 1,591 | 5,834 | 5,512 |
Tax preparation and accounting | 2,527 | 2,386 | 6,527 | 7,222 |
Other | 299 | 176 | 1,016 | 385 |
Total Revenues | 48,047 | 46,342 | 144,500 | 127,997 |
Operating Expenses | ||||
Commissions, compensation and fees | 39,963 | 39,667 | 118,983 | 110,260 |
Clearing fees | 470 | 509 | 1,826 | 1,798 |
Communications | 690 | 786 | 2,094 | 2,427 |
Occupancy | 972 | 982 | 2,916 | 2,886 |
License and registration | 391 | 417 | 1,223 | 1,155 |
Professional fees | 1,083 | 2,327 | 3,336 | 4,897 |
Interest | 5 | 13 | 13 | 16 |
Depreciation and amortization | 288 | 302 | 871 | 898 |
Other administrative expenses | 3,610 | 1,624 | 7,315 | 3,973 |
Total Operating Expenses | 47,472 | 46,627 | 138,577 | 128,310 |
Income (Loss) before Other Income (Expense) and Income Taxes | 575 | (285) | 5,923 | (313) |
Other Income (Expense) | ||||
Gain on disposal of Gilman branches | 0 | 0 | 130 | 0 |
Change in fair value of warrants | (642) | 0 | 5,223 | 0 |
Other income | 5 | 0 | 10 | 0 |
Total Other Income (Expense) | (637) | 0 | 5,363 | 0 |
Income (Loss) before Income Taxes | (62) | (285) | 11,286 | (313) |
Income tax expense (benefit) | (38) | (124) | 2,377 | (69) |
Net Income (Loss) | $ (24) | $ (161) | $ 8,909 | $ (244) |
Net income (loss) per share - Basic (in dollars per share) | $ 0 | $ (0.01) | $ 0.72 | $ (0.02) |
Net income (loss) per share - Diluted (in dollars per share) | $ 0 | $ (0.01) | $ 0.72 | $ (0.02) |
Weighted average number of shares outstanding - Basic (in shares) | 12,437,916 | 12,440,035 | 12,437,916 | 12,442,059 |
Weighted average number of shares outstanding - Diluted (in shares) | 12,437,916 | 12,440,035 | 12,459,834 | 12,442,059 |
Condensed Consolidated Stateme5
Condensed Consolidated Statement of Changes in Stockholders' Equity (Unaudited) - 9 months ended Jun. 30, 2017 - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-in- Capital | Accumulated Deficit | Non-Controlling Interest |
Balance (in shares) at Sep. 30, 2016 | 12,437,916 | ||||
Balance at Sep. 30, 2016 | $ 25,773 | $ 248 | $ 66,353 | $ (40,843) | $ 15 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Stock-based compensation – restricted stock units | 312 | 312 | |||
Net income | 8,909 | 8,909 | |||
Balance (in shares) at Jun. 30, 2017 | 12,437,916 | ||||
Balance at Jun. 30, 2017 | $ 34,994 | $ 248 | $ 66,665 | $ (31,934) | $ 15 |
Condensed Consolidated Stateme6
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 9 Months Ended | |
Jun. 30, 2017 | Jun. 30, 2016 | |
CASH FLOWS FROM OPERATING ACTIVITIES | ||
Net income (loss) | $ 8,909,000 | $ (244,000) |
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities | ||
Change in fair value of warrants | (5,223,000) | 0 |
Depreciation and amortization | 871,000 | 898,000 |
Amortization of forgivable loans to registered representatives | 520,000 | 493,000 |
Stock-based compensation | 312,000 | 125,000 |
Recovery for doubtful accounts | (274,000) | |
Provision for doubtful accounts | 121,000 | |
Amortization of deferred clearing credit | (157,000) | (157,000) |
Increase in fair value of contingent consideration payable | 21,000 | 12,000 |
Deferred tax expense (benefit) | 392,000 | (139,000) |
Gain on disposal of Gilman branches | (130,000) | 0 |
Changes in assets and liabilities | ||
Restricted cash | (1,026,000) | (135,000) |
Cash deposits with clearing organizations | (10,000) | (25,000) |
Securities owned, at fair value | 762,000 | (635,000) |
Receivables from broker-dealers and clearing organizations | 571,000 | (532,000) |
Forgivable loans receivable | (77,000) | (933,000) |
Other receivables, net | 1,566,000 | (264,000) |
Prepaid expenses | 755,000 | 89,000 |
Other assets, principally refundable deposits | 6,000 | 206,000 |
Accounts payable, accrued expenses and other liabilities | (347,000) | (727,000) |
Securities sold, but not yet purchased, at fair value | (298,000) | (32,000) |
Net cash provided by (used in) operating activities | 7,143,000 | (1,879,000) |
CASH FLOWS FROM INVESTING ACTIVITIES | ||
Acquisition of business | (19,000) | 0 |
Purchase of fixed assets | (641,000) | (470,000) |
Collection on notes receivable - disposal of Gilman branches | 28,000 | 0 |
Net cash used in investing activities | (632,000) | (470,000) |
CASH FLOWS FROM FINANCING ACTIVITIES | ||
Repurchase of shares of common stock | 0 | (86,000) |
Net cash used in financing activities | 0 | (86,000) |
NET INCREASE (DECREASE) IN CASH | 6,511,000 | (2,435,000) |
CASH BALANCE | ||
Beginning of the period | 21,694,000 | 24,642,000 |
End of the period | 28,205,000 | 22,207,000 |
Cash paid during the period for: | ||
Interest | 11,000 | 16,000 |
Income taxes | 1,004,000 | 76,000 |
SUPPLEMENTAL DISCLOSURES OF NONCASH INVESTING AND FINANCING ACTIVITIES | ||
Fixed assets (acquired but not paid) | 665,000 | 0 |
Identifiable intangible asset acquired | 211,000 | 0 |
Contingent consideration payable | (192,000) | 0 |
Cash paid | 19,000 | 0 |
Sale of Gilman branches: | ||
Notes receivable (included in other receivables) | 638,000 | 0 |
Disposal of goodwill | (305,000) | 0 |
Disposal of intangible assets, net | (203,000) | 0 |
Gain on disposal of Gilman branches | $ 130,000 | $ 0 |
BASIS OF PRESENTATION
BASIS OF PRESENTATION | 9 Months Ended |
Jun. 30, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
BASIS OF PRESENTATION | BASIS OF PRESENTATION The accompanying condensed consolidated financial statements of the Company, have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) for interim financial statements and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not include all of the information and disclosures required for annual financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. The condensed consolidated financial statements as of June 30, 2017 and for the three and nine months ended June 30, 2017 and 2016 are unaudited. The results of operations for the interim periods are not necessarily indicative of the results of operations for the respective fiscal years. The consolidated statement of financial condition at September 30, 2016 has been derived from the audited financial statements at that date, but does not include all of the information and notes required by GAAP for complete financial statement presentation. The accompanying consolidated financial information should be read in conjunction with the Company's Annual Report on Form 10-K for the fiscal year ended September 30, 2016 for additional disclosures and accounting policies. Certain items in the condensed consolidated statement of operations for the fiscal 2016 period have been reclassified to conform to the presentation in the fiscal 2017 period. Such reclassifications did not have a material impact on the presentation of the overall financial statements. |
ORGANIZATION AND DESCRIPTION OF
ORGANIZATION AND DESCRIPTION OF BUSINESS | 9 Months Ended |
Jun. 30, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
ORGANIZATION AND DESCRIPTION OF BUSINESS | ORGANIZATION AND DESCRIPTION OF BUSINESS National Holdings Corporation (“National” or the “Company”), a Delaware corporation organized in 1996, operates through its wholly owned subsidiaries which principally provide financial services. Through its broker-dealer and investment advisory subsidiaries, the Company (1) offers full service retail brokerage and investment advisory services to individual, corporate and institutional clients, (2) provides investment banking, merger, acquisition and advisory services to micro, small and mid-cap high growth companies, (3) engages in trading securities, including making markets in micro and small-cap, NASDAQ and other exchange listed stocks and (4) provides liquidity in the United States Treasury marketplace. Broker-dealer subsidiaries consist of National Securities Corporation (“National Securities” or “NSC”) and vFinance Investments, Inc. (“vFinance Investments”) (collectively, the “Broker-Dealer Subsidiaries”). The Broker-Dealer Subsidiaries conduct a national securities brokerage business through their main offices in New York City, New York, Boca Raton, Florida, and Seattle, Washington. Broker-dealer subsidiaries are introducing brokers and clear all transactions through clearing organizations, on a fully disclosed basis. The Broker-Dealer Subsidiaries are registered with the Securities and Exchange Commission ("SEC") and the Commodities and Futures Trading Commission, and are members of the Financial Industry Regulatory Authority ("FINRA"), the Securities Investor Protection Corporation and the National Futures Association. The Company’s wholly-owned subsidiary, National Asset Management, Inc. ("NAM"), is a federally-registered investment adviser providing asset management advisory services to retail clients for a fee based upon a percentage of assets managed. The Company’s wholly-owned subsidiaries, National Insurance Corporation ("National Insurance") and Prime Financial Services ("Prime Financial"), provide fixed insurance products to their clients, including life insurance, disability insurance, long term care insurance and fixed annuities. The Company’s wholly-owned subsidiary, Gilman Ciocia, Inc. ("Gilman"), provides tax preparation and accounting services to individuals and small to midsize companies. The Company’s wholly-owned subsidiary, GC Capital Corporation ("GC"), provides licensed mortgage brokerage services in New York and Florida. On September 9, 2016, a subsidiary of Fortress Biotech, Inc. (“Fortress”), acquired a controlling interest in the Company. See Note 19. |
RECEIVEABLES FROM BROKER-DEALER
RECEIVEABLES FROM BROKER-DEALERS AND CLEARING ORGANIZATIONS AND OTHER RECEIVABLES | 9 Months Ended |
Jun. 30, 2017 | |
Brokers and Dealers [Abstract] | |
RECEIVEABLES FROM BROKER-DEALERS AND CLEARING ORGANIZATIONS AND OTHER RECEIVABLES | RECEIVABLES FROM BROKER-DEALERS AND CLEARING ORGANIZATIONS AND OTHER RECEIVABLES At June 30, 2017 and September 30, 2016 , the receivables of $2,786,000 and $3,357,000 , respectively, from broker-dealers and clearing organizations represent net amounts due for fees and commissions associated with the Company’s retail brokerage business as well as asset based fee revenues associated with the Company’s Investment advisory business. Other receivables, net, at June 30, 2017 and September 30, 2016 of $4,748,000 and $5,430,000 , respectively, principally represent (a) trailing fees of $1,196,000 and $1,250,000 , respectively, (b) fees for tax and accounting services of $546,000 and $864,000 , respectively, net of allowance for doubtful accounts of $307,000 and $581,000 , respectively, (c) advances to registered representatives of $889,000 and $918,000 , respectively, net of allowance for doubtful accounts of $154,000 for both periods, (d) receivable related to investment banking of $773,000 and $1,877,000 , respectively, (e) receivable related to advisory fees of $486,000 and $597,000 , respectively, and (f) notes receivable in the aggregate principal amount of $613,000 at June 30, 2017 from the sale of two Gilman branches (see Note 7). |
FORGIVABLE LOANS RECEIVABLE
FORGIVABLE LOANS RECEIVABLE | 9 Months Ended |
Jun. 30, 2017 | |
Investments in and Advances to Affiliates, Schedule of Investments [Abstract] | |
FORGIVABLE LOANS RECEIVABLE | FORGIVABLE LOANS RECEIVABLE From time to time, the Company's operating subsidiaries may make loans, evidenced by promissory notes, primarily to newly recruited independent financial advisors as an incentive for their affiliation. The notes receivable balance is comprised of unsecured non-interest-bearing and interest-bearing loans (interest rates ranging up to 9% ). These notes have various schedules for repayment or forgiveness based on production or retention requirements being met and mature at various dates through 2021. Forgiveness of loans amounted to $520,000 and $493,000 for the nine months ended June 30, 2017 and 2016 , respectively, and the related compensation was included in commissions, compensation and fees in the condensed consolidated statements of operations. In the event the advisor’s affiliation with the subsidiary terminates, the advisor is required to repay the unamortized balance of any notes payable. The Company provides an allowance for doubtful accounts on the notes based on historical collection experience and continually evaluates the receivables for collectability and possible write-offs where a loss is deemed probable. As of June 30, 2017 and September 30, 2016 , no allowance for doubtful accounts was required. Forgivable loan activity for the nine months ended June 30, 2017 is as follows: Balance, October 1, 2016 $ 1,712,000 Additions 77,000 Amortization (520,000 ) Balance, June 30, 2017 $ 1,269,000 There were no unamortized loans outstanding at June 30, 2017 and September 30, 2016 attributable to registered representatives who ended their affiliation with the Broker-Dealer Subsidiaries prior to the fulfillment of their obligation. |
FAIR VALUE OF ASSETS AND LIABIL
FAIR VALUE OF ASSETS AND LIABILITIES | 9 Months Ended |
Jun. 30, 2017 | |
Schedule of Investments [Abstract] | |
FAIR VALUE OF ASSETS AND LIABILITIES | FAIR VALUE OF ASSETS AND LIABILITIES Authoritative accounting guidance defines fair value, establishes a framework for measuring fair value, and establishes a fair value hierarchy which prioritizes the inputs to valuation techniques. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. A fair value measurement assumes that the transaction to sell the asset or transfer the liability occurs in the principal market for the asset or liability or, in the absence of a principal market, the most advantageous market. Valuation techniques that are consistent with the market or income approach are used to measure fair value. The fair value hierarchy ranks the quality and reliability of the information used to determine fair values. Financial assets and liabilities carried at fair value are classified and disclosed in one of the following three categories: Level 1 - Unadjusted quoted prices in active markets for identical assets or liabilities. Level 2 - Inputs other than quoted market prices that are observable, either directly or indirectly, and reasonably available. Observable inputs reflect the assumptions market participants would use in pricing the asset or liability and are developed based on market data obtained from sources independent of the Company. Level 3 - Unobservable inputs which reflect the assumptions that the Company develops based on available information about what market participants would use in valuing the asset or liability. The following tables present the carrying values and estimated fair values at June 30, 2017 and September 30, 2016 of financial assets and liabilities, excluding financial instruments that are carried at fair value on a recurring basis, and information is provided on their classification within the fair value hierarchy. Such instruments are carried at amounts that approximate fair value due to their short-term nature and generally negligible credit risk. June 30, 2017 Assets Carrying Value Level 1 Level 2 Total Estimated Fair Value Cash $ 28,205,000 $ 28,205,000 $ — $ 28,205,000 Cash deposits with clearing organizations 1,040,000 1,040,000 — 1,040,000 Receivables from broker-dealers and clearing organizations 2,786,000 — 2,786,000 2,786,000 Forgivable loans receivable (1) 1,269,000 — 1,269,000 1,269,000 Other Receivables, Net 4,748,000 — 4,748,000 4,748,000 $ 38,048,000 $ 29,245,000 $ 8,803,000 $ 38,048,000 Liabilities Accrued commissions and payroll payable 11,255,000 — 11,255,000 11,255,000 Accounts payable and accrued expenses (2) 7,871,000 — 7,871,000 7,871,000 $ 19,126,000 $ — $ 19,126,000 $ 19,126,000 (1) Carrying value approximates fair value, which is determined based on a valuation technique to convert future cash payments or forgiveness transactions to a single discounted preset value amount. (2) Excludes contingent consideration liabilities of $637,000 . September 30, 2016 Assets Carrying Value Level 1 Level 2 Total Estimated Fair Value Cash $ 21,694,000 $ 21,694,000 $ — $ 21,694,000 Cash deposits with clearing organizations 1,030,000 1,030,000 — 1,030,000 Receivables from broker-dealers and clearing organizations 3,357,000 — 3,357,000 3,357,000 Forgivable loans receivable (1) 1,712,000 — 1,712,000 1,712,000 Other Receivables, Net 5,430,000 — 5,430,000 5,430,000 $ 33,223,000 $ 22,724,000 $ 10,499,000 $ 33,223,000 Liabilities Accrued commissions and payroll payable 11,940,000 — 11,940,000 11,940,000 Accounts payable and accrued expenses (2) 6,742,000 — 6,742,000 6,742,000 $ 18,682,000 $ — $ 18,682,000 $ 18,682,000 (1) Carrying value approximates fair value, which is determined based on a valuation technique to convert future cash payments or forgiveness transactions to a single discounted preset value amount. (2) Excludes contingent consideration liabilities of $424,000 . The following tables present the financial assets and liabilities measured at fair value on a recurring basis at June 30, 2017 and September 30, 2016 : June 30, 2017 Assets Carrying Value Level 1 Level 2 Level 3 Total Estimated Fair Value Corporate stocks $ 70,000 $ 70,000 $ — $ — $ 70,000 Municipal bonds 1,333,000 816,000 517,000 — 1,333,000 Restricted stock 192,000 — 192,000 — 192,000 $ 1,595,000 $ 886,000 $ 709,000 $ — $ 1,595,000 Liabilities Contingent consideration 637,000 — — 637,000 637,000 Warrants issued 8,832,000 — 8,832,000 — 8,832,000 $ 9,469,000 $ — $ 8,832,000 $ 637,000 $ 9,469,000 September 30, 2016 Assets Carrying Value Level 1 Level 2 Level 3 Total Estimated Fair Value Corporate stocks $ 101,000 $ 101,000 $ — $ — $ 101,000 Municipal bonds 2,111,000 2,111,000 — — 2,111,000 Restricted stock 145,000 — 145,000 — 145,000 $ 2,357,000 $ 2,212,000 $ 145,000 $ — $ 2,357,000 Liabilities Contingent consideration 424,000 — — 424,000 424,000 Warrants issuable 14,055,000 — 14,055,000 — 14,055,000 Corporate stocks 298,000 298,000 — — 298,000 $ 14,777,000 $ 298,000 $ 14,055,000 $ 424,000 $ 14,777,000 |
FIXED ASSETS
FIXED ASSETS | 9 Months Ended |
Jun. 30, 2017 | |
Property, Plant and Equipment [Abstract] | |
FIXED ASSETS | FIXED ASSETS Fixed assets as of June 30, 2017 and September 30, 2016 consist of the following: June 30, September 30, Estimated Useful Lives Equipment and software $ 1,741,000 $ 1,036,000 5 Furniture and fixtures 338,000 163,000 5 Leasehold improvements 1,079,000 653,000 Lesser of useful Capital leases (primarily composed of computer equipment) 739,000 739,000 5 3,897,000 2,591,000 Less accumulated depreciation and amortization (1,705,000 ) (1,427,000 ) Fixed assets – net $ 2,192,000 $ 1,164,000 Depreciation expense associated with fixed assets for the three months ended June 30, 2017 and 2016 was $91,000 and $122,000 , respectively. Depreciation expense associated with fixed assets for the nine months ended June 30, 2017 and 2016 was $278,000 and $345,000 , respectively. |
BUSINESS COMBINATION, CONTINGEN
BUSINESS COMBINATION, CONTINGENT CONSIDERATION AND DISPOSAL OF BRANCHES | 9 Months Ended |
Jun. 30, 2017 | |
Business Combinations [Abstract] | |
BUSINESS COMBINATION, CONTINGENT CONSIDERATION AND DISPOSAL OF BRANCHES | BUSINESS COMBINATION, CONTINGENT CONSIDERATION AND DISPOSAL OF BRANCHES Business Combination In October 2016, Gilman acquired certain assets of a tax preparation and accounting business that was deemed to be a business acquisition. The consideration for the transaction consisted of a cash payment at closing of $19,000 and contingent consideration payable in cash having a fair value of $192,000 , for which a liability (included in Accounts payable and accrued expenses) was recognized based on the estimated acquisition date fair value of the potential earn-out. The earn-out is based on revenue, as defined in the acquisition agreement, during the 36 -month period following the closing up to a maximum of $225,600 . The liability was valued using an income-based approach using unobservable inputs (Level 3) and reflects the Company’s own assumptions. The liability will be revalued at each Balance Sheet date with changes therein recorded in earnings. The fair value of the acquired assets was allocated to customer relationships, which is being amortized over three years. Results of operations of the acquired business are included in the accompanying condensed consolidated statements of operations from the date of acquisition and were not material. In addition, based on materiality, pro forma results are not presented. Contingent Consideration Set below are changes in the carrying value of contingent consideration for the nine months ended June 30, 2017 related to acquisitions: Fair value of contingent consideration at September 30, 2016 $ 424,000 Fair value of contingent consideration in connection with above acquisition 192,000 Payments — Change in fair value 21,000 Fair value of contingent consideration at June 30, 2017 $ 637,000 Disposal of Gilman Branches In January 2017, the Company sold two of its Gilman branches for notes in the aggregate principal amounts of $638,000 which, after allocating a portion of goodwill and unamortized intangibles of $305,000 and $203,000 , respectively, resulted in a gain on disposal of $130,000 . Principal and interest on the notes is payable monthly over 83 to 95 months with interest at 3% to 4% per annum. ACQUISITION OF CONTROLLING INTEREST IN THE COMPANY On September 12, 2016, FBIO Acquisition, Inc. (“FBIO Acquisition”), a wholly-owned subsidiary of Fortress, completed a tender offer (the “Offer”) for all outstanding shares of the Company at a price of $3.25 per share, net to the seller in cash (less any required withholding taxes and without interest) (the “Offer Price”), pursuant to the terms of an Agreement and Plan of Merger dated as of April 27, 2016 (as amended, the “Merger Agreement”) among the Company, Fortress and FBIO Acquisition. The Offer expired on September 9, 2016, and a total of 7,037,482 shares were validly tendered and not withdrawn (including shares delivered through notices of guaranteed delivery), representing approximately 56.6% of the Company's issued and outstanding shares of common stock immediately following the completion of the Offer (in each case, without giving effect to the issuance or exercise of the Dividend Warrants). On September 12, 2016, FBIO Acquisition accepted for payment all shares that were validly tendered and not withdrawn prior to the expiration time of the Offer (such time of acceptance, the "Acceptance Time") and delivered payment for such shares. Dividend Warrants In accordance with the Merger Agreement, since less than 80% of the Company's issued and outstanding shares of common stock were tendered, the Company remains a publicly-traded company and stockholders post-tender offer received from the Company a five year warrant per held share to purchase an additional share of the Company's common stock at $3.25 as a dividend to all holders of the Company's common stock. As the Company does not have the ability to settle the warrants with unregistered shares and maintenance of an effective registration statement (which did not exist at September 30, 2016) may be considered outside of the Company’s control, net cash settlement of the warrants is assumed. Accordingly, as the Company was obligated to issue the warrants at September 30, 2016 , and subsequently issued the warrants in January 2017, the fair value of the 12,437,916 warrants are being classified as a liability in the condensed consolidated statement of financial condition at June 30, 2017 and September 30, 2016 . This liability is subject to re-measurement at each balance sheet date until the warrants are exercised or expired, and any change in fair value is recognized as “change in fair value of warrants” in the condensed consolidated statements of operations. As the warrants were registered and trading and the Company maintained an effective registration statement at June 30, 2017 , fair value of the warrants was based on the market price. As of September 30, 2016 , valuation was determined by use of the Black-Scholes option pricing model using the following assumptions: Fiscal Year 2016 Dividend yield 0.00 % Expected volatility 38.20 % Risk-free interest rate 1.14 % Life (in years) 5 |
INTANGIBLE ASSETS
INTANGIBLE ASSETS | 9 Months Ended |
Jun. 30, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
INTANGIBLE ASSETS | INTANGIBLE ASSETS Intangibles consisted of the following at June 30, 2017 and September 30, 2016 : June 30, 2017 Intangible asset Cost Accumulated Amortization Carrying Value Estimated Customer relationships $ 6,867,000 $ 2,508,000 $ 4,359,000 3-10 Non-compete 296,000 296,000 — 2 Gilman brand name 760,000 — 760,000 Indefinite $ 7,923,000 $ 2,804,000 $ 5,119,000 September 30, 2016 Intangible asset Cost Accumulated Amortization Carrying Value Estimated Customer relationships $ 6,969,000 $ 2,025,000 $ 4,944,000 7-10 Non-compete 296,000 296,000 — 2 Gilman brand name 760,000 — 760,000 Indefinite $ 8,025,000 $ 2,321,000 $ 5,704,000 Amortization expense associated with intangible assets for the three months ended June 30, 2017 and 2016 was $197,000 and $180,000 , respectively. Amortization expense associated with intangible assets for the nine months ended June 30, 2017 and 2016 was $593,000 and $553,000 , respectively. The estimated future amortization expense of the finite lived intangible assets for the next five fiscal years and thereafter is as follows: Year ending Three months ending September 30, 2017 $ 197,000 2018 790,000 2019 790,000 2020 719,000 2021 719,000 Thereafter 1,144,000 Total $ 4,359,000 |
ACCOUNTS PAYABLE AND ACCRUED EX
ACCOUNTS PAYABLE AND ACCRUED EXPENSES | 9 Months Ended |
Jun. 30, 2017 | |
Payables and Accruals [Abstract] | |
ACCOUNTS PAYABLE AND ACCRUED EXPENSES | ACCOUNTS PAYABLE AND ACCRUED EXPENSES Accounts payable and accrued expenses as of June 30, 2017 and September 30, 2016 consist of the following: June 30, September 30, Legal $ 836,000 $ 1,346,000 Audit 148,000 198,000 Telecommunications 196,000 209,000 Data services 450,000 425,000 Regulatory 661,000 444,000 Settlements 2,633,000 832,000 Contingent consideration payable 636,000 424,000 Deferred rent 177,000 65,000 Income taxes payable 927,000 — Other 1,844,000 3,223,000 Total $ 8,508,000 $ 7,166,000 |
PER SHARE DATA
PER SHARE DATA | 9 Months Ended |
Jun. 30, 2017 | |
Earnings Per Share [Abstract] | |
PER SHARE DATA | PER SHARE DATA Basic net income (loss) per share of common stock attributable to the Company is computed on the basis of the weighted average number of shares of common stock outstanding. Diluted net income (loss) per share is computed on the basis of such weighted average number of shares of common stock outstanding plus the dilutive effect of incremental shares of common stock potentially issuable under outstanding options, warrants and unvested restricted stock units utilizing the treasury stock method. A reconciliation of basic and diluted common shares used in the computation of per share data follows: Three Month Period Ended June 30, Nine Month Period Ended June 30, 2017 2016 2017 2016 Basic weighted-average shares 12,437,916 12,440,035 12,437,916 12,442,059 Effect of dilutive securities: Options — — 186 — Unvested restricted stock units — — 21,732 — Warrants — — — — Diluted weighted-average shares 12,437,916 12,440,035 12,459,834 12,442,059 The following potential common share equivalents are not included in the above diluted computation because to do so would be anti-dilutive as the instruments are out of the money: Three Month Period Ended June 30, Nine Month Period Ended June 30, 2017 2016 2017 2016 Options 1,206,000 1,224,500 1,207,333 1,311,167 Warrants 12,459,474 (a) 43,116 8,313,502 (a) 43,116 Restricted stock units 312,500 — — — 13,977,974 1,267,616 9,520,835 1,354,283 (a) As the warrants are out of the money, in the diluted computation, no adjustment is made to net income (loss) to eliminate the change in fair value of the warrants. |
OFF BALANCE SHEET RISK AND CONC
OFF BALANCE SHEET RISK AND CONCENTRATION OF CREDIT RISK | 9 Months Ended |
Jun. 30, 2017 | |
Risks and Uncertainties [Abstract] | |
OFF BALANCE SHEET RISK AND CONCENTRATION OF CREDIT RISK | OFF BALANCE SHEET RISK AND CONCENTRATION OF CREDIT RISK The Company is engaged in trading and providing a broad range of securities brokerage and investment services to a diverse group of retail and institutional clientele, as well as corporate finance and investment banking services to corporations and businesses. Counterparties to the Company’s business activities include broker-dealers and clearing organizations, banks and other financial institutions. The Company uses clearing brokers to process transactions and maintain customer accounts for the Company on a fee basis. The Company permits the clearing firms to extend credit to its clientele secured by cash and securities in the client’s account. The Company’s exposure to credit risk associated with the non-performance by its customers and counterparties in fulfilling their contractual obligations can be directly impacted by volatile or illiquid trading markets, which may impair the ability of customers and counterparties to satisfy their obligations to the Company. The Company has agreed to indemnify the clearing brokers for losses they incur while extending credit to the Company’s clients. It is the Company’s policy to review, as necessary, the credit standing of its customers and counterparties. Amounts due from customers that are considered uncollectible by the clearing broker are charged back to the Company by the clearing broker when such amounts become determinable. Upon notification of a charge back, such amounts, in total or in part, are then either (i) collected from the customers, (ii) charged to the broker initiating the transaction and/or (iii) charged to operations, based on the particular facts and circumstances. The Company maintains cash in bank deposits, which, at times, may exceed federally insured limits. The Company has not experienced and does not expect to experience losses on such accounts. A short sale involves the sale of a security that is not owned in the expectation of purchasing the same security (or a security exchangeable) at a later date at a lower price. A short sale involves the risk of a theoretically unlimited increase in the market price of the security that would result in a theoretically unlimited loss. |
NEW ACCOUNTING GUIDANCE
NEW ACCOUNTING GUIDANCE | 9 Months Ended |
Jun. 30, 2017 | |
Accounting Policies [Abstract] | |
NEW ACCOUNTING GUIDANCE | NEW ACCOUNTING GUIDANCE In May 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2014-09, Revenue From Contracts With Customers (Topic 606) which creates a single, principle-based model for revenue recognition and expands and improves disclosures about revenue. The new guidance is effective for the Company beginning October 1, 2018, and must be adopted using either a full retrospective approach for all periods presented in the period of adoption or a modified retrospective approach. The Company is currently evaluating the potential impact of this standard on its financial statements which, (1) for investment banking advisory arrangements may change the timing of revenue recognition depending on the number and nature of the performance obligations identified, (2) for underwriting expenses and costs of advisory services and related reimbursement revenue may need to be recognized on a gross basis, and (3) for costs to obtain a contract may need to be capitalized, amortized and reviewed regularly for impairment. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842), which supersedes the existing guidance for lease accounting, Leases (Topic 840). ASU 2016-02 requires lessees to recognize leases on their balance sheets, and leaves lessor accounting largely unchanged. The amendments in this ASU are effective for the Company beginning October 1, 2019 and interim periods within those fiscal years. Early application is permitted for all entities. ASU 2016-02 requires a modified retrospective approach for all leases existing at, or entered into after, the date of initial application, with an option to elect to use certain transition relief. The Company is currently assessing the impact that the adoption of ASU 2016-02 will have on its financial statements. In March 2016, the FASB issued ASU 2016-09, “Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting”. ASU 2016-09 simplifies several aspects of the accounting for employee share-based payment transactions, including the accounting for income taxes, forfeitures and statutory tax withholding requirements, as well as classification in the statement of cash flows. ASU 2016-09 is effective for the Company beginning October 1, 2017 for both interim and annual reporting periods. The Company is currently assessing the impact that the adoption of ASU 2016-09 will have on its financial statements. In August 2016, the FASB issued ASU 2016-15, “Statement of Cash Flows (Topic 230) - Classification of Certain Cash Receipts and Cash Payments”. ASU 2016-15 reduces the diversity of how certain cash receipts and cash payments are presented and classified in the statement of cash flows under Topic 230, Statement of Cash Flows, and other Topics. The standard is effective for the Company beginning October 1, 2018 for both interim and annual periods. Early adoption is permitted. The ASU should be applied retrospectively to all periods presented. The Company does not anticipate that the adoption of ASU 2016-15 will have a material impact on its financial statements. In November 2016, the FASB issued ASU 2016-18, “Statement of Cash Flows (Topic 230) - Restricted Cash”. ASU 2016-18 reduces the diversity in the presentation of restricted cash and restricted cash equivalents in the statement. The statement requires that restricted cash and restricted cash equivalents be included as components of total cash and cash equivalents as presented on the statement of cash flows. The standard is effective for the Company beginning October 1, 2018 for both interim and annual periods. Early adoption is permitted. The ASU should be applied retrospectively to all periods presented. The Company is currently assessing the impact that the adoption of ASU 2016-18 will have on its financial statements. In January 2017, the FASB issued ASU 2017-01, “Business Combinations (Topic 805): Clarifying the Definition of a Business”. The amendments in this Update is to clarify the definition of a business with the objective of adding guidance to assist entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. The definition of a business affects many areas of accounting including acquisitions, disposals, goodwill, and consolidation. The standard is effective for the Company beginning October 1, 2018 for both interim and annual periods. The Company is currently assessing the impact that the adoption of ASU 2017-01 will have on its financial statements. In January 2017, FASB issued ASU 2017-04, "Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment", which eliminates the second step of the previous FASB guidance for testing goodwill for impairment and is intended to reduce cost and complexity of goodwill impairment testing. The standard is effective for the Company beginning October 1, 2020 for both interim and annual periods. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. The Company is currently assessing the impact that the adoption of ASU 2017-04 will have on its financial statements. In May 2017, the FASB issued ASU 2017-09, “Scope of Modification Accounting”. This ASU clarifies when changes to the terms or conditions of a share-based payment award must be accounted for as modifications. Under the new guidance, modification accounting is required only if the fair value, the vesting conditions, or the classification of the award (as equity or liability) changes as a result of the change in terms or conditions. The standard is effective for the Company beginning October 1, 2018 for both interim and annual periods. Early adoption is permitted. The Company is currently assessing the impact that the adoption of ASU 2017-09 will have on its financial statements. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 9 Months Ended |
Jun. 30, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES Leases The Company leases office space in various states expiring at various dates through October 2026, and as of June 30, 2017 , is committed under operating leases for future minimum lease payments as follows: Fiscal Year Ending Lease Payments Three months ending September 30, 2017 $ 711,000 2018 3,138,000 2019 2,634,000 2020 2,415,000 2021 2,096,000 Thereafter 5,855,000 $ 16,849,000 The total amount of rent payable under the leases is recognized on a straight line basis over the term of the leases. Rental expense under all operating leases, excluding sublease income, for the three months ended June 30, 2017 and 2016 was $929,000 and $961,000 , respectively. Rental expense under all operating leases, excluding sublease income, for the nine months ended June 30, 2017 and 2016 was $2,854,000 and $2,880,000 , respectively. Sublease income under all operating subleases for the three months ended June 30, 2017 and 2016 was approximately $2,000 and $35,000 , respectively. Sublease income under all operating subleases for the nine months ended June 30, 2017 and 2016 was approximately $77,000 and $106,000 , respectively. As of June 30, 2017 , the Company and its subsidiaries had three outstanding letters of credit, which have been issued in the maximum amount of $1,380,000 as security for property leases, and which are collateralized by the restricted cash as reflected in the condensed consolidated statements of financial condition. Litigation and Regulatory Matters The Company and its subsidiaries are defendants or respondents in various pending and threatened arbitrations, administrative proceedings and lawsuits seeking compensatory damages. Several cases have no stated alleged damages. Claim amounts are infrequently indicative of the actual amounts the Company will be liable for, if any. Further, the Company has a history of collecting amounts awarded in these types of matters from its registered representatives that are still affiliated, as well as from those that are no longer affiliated. Many of these claimants also seek, in addition to compensatory damages, punitive or treble damages, and all seek interest, costs and fees. These matters arise in the normal course of business. The Company intends to vigorously defend itself in these actions, and the ultimate outcome of these matters cannot be determined at this time. Liabilities for potential losses from complaints, legal actions, government investigations and proceedings are established where the Company believes that it is probable that a liability has been incurred and the amount of loss can be reasonably estimated. In making these decisions, management bases its judgments on its knowledge of the situations, consultations with legal counsel and its historical experience in resolving similar matters. In many lawsuits, arbitrations and regulatory proceedings, it is not possible to determine whether a liability has been incurred or to estimate the amount of that liability until the matter is close to resolution. However, accruals are reviewed regularly and are adjusted to reflect the Company’s estimates of the impact of developments, rulings, advice of counsel and any other information pertinent to a particular matter. Because of the inherent difficulty in predicting the ultimate outcome of legal and regulatory actions, management cannot predict with certainty the eventual loss or range of loss related to such matters. At June 30, 2017 and September 30, 2016 , the Company accrued approximately $2,633,000 and $832,000 , respectively. These amounts are included in accounts payable and accrued expenses in the condensed consolidated statements of financial condition. During the three and nine months ended June 30, 2017 , the Company charged $2,326,000 and $3,322,000 , respectively, to operations with respect to such matters and during the three and nine months ended June 30, 2016 , the Company charged $362,000 and $525,000 , respectively, to operations, which is included in other administrative expenses. The Company has included in "Professional fees" litigation and FINRA related expenses of $430,000 and $346,000 for the three months ended June 30, 2017 and 2016 , respectively and $1,229,000 and $799,000 for the nine months ended June 30, 2017 and 2016 , respectively. |
NET CAPITAL REQUIREMENTS
NET CAPITAL REQUIREMENTS | 9 Months Ended |
Jun. 30, 2017 | |
Disclosure Text Block [Abstract] | |
NET CAPITAL REQUIREMENTS | NET CAPITAL REQUIREMENTS National Securities is subject to the SEC's Uniform Net Capital Rule (Rule 15c3-1) (the "Rule"), which, among other things, requires the maintenance of minimum net capital. At June 30, 2017 , National Securities had net capital of $10,464,721 which was $10,214,721 in excess of its required net capital of $250,000 . National Securities is exempt from the provisions of the SEC's Rule 15c3-3 since it is an introducing broker-dealer that clears all transactions on a fully disclosed basis and promptly transmits all customer funds and securities to clearing brokers. vFinance Investments is also subject to the Rule, which, among other things, requires the maintenance of minimum net capital and requires that the ratio of aggregate indebtedness to net capital, both as defined, shall not exceed 15 to 1. At June 30, 2017 , vFinance Investments had net capital of $1,534,147 which was $534,147 in excess of its required net capital of $1,000,000 . vFinance Investments' ratio of aggregate indebtedness to net capital was 0.8 to 1 . vFinance Investments is exempt from the provisions of the SEC's Rule 15c3-3 since it is an introducing broker-dealer that clears all transactions on a fully disclosed basis and promptly transmits all customer funds and securities to clearing brokers. Advances, dividend payments and other equity withdrawals from the Company's Broker-Dealer Subsidiaries are restricted by the regulations of the SEC, and other regulatory agencies. These regulatory restrictions may limit the amounts that a subsidiary may dividend or advance to the Company. |
STOCKHOLDERS' EQUITY
STOCKHOLDERS' EQUITY | 9 Months Ended |
Jun. 30, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
STOCKHOLDERS' EQUITY | STOCKHOLDERS' EQUITY Shares Authorized On January 26, 2017, the stockholders of the Company approved (i) to amend the Company's certificate of incorporation to decrease the number of authorized shares of its common stock from 150,000,000 shares to 75,000,000 shares and (ii) to amend the Company's 2013 Omnibus Incentive Plan to increase the number of shares of its common stock authorized for issuance by 650,000 . Stock Options Information with respect to stock option activity during the nine months ended June 30, 2017 follows: Options Weighted Weighted Weighted Aggregate Outstanding at September 30, 2016 1,221,500 $ 6.51 $ 1.22 3.31 $ — Forfeited (15,500 ) $ 4.42 $ 1.99 $ — Outstanding at June 30, 2017 1,206,000 $ 6.54 $ 1.21 2.54 $ — Vested and exercisable at June 30, 2017 1,206,000 $ 6.54 $ 1.21 2.54 $ — As of September 30, 2016 , all compensation expense associated with the grants of stock options had been recognized. During the three and nine months ended June 30, 2016 , the Company recognized compensation expense of $26,000 and $125,000 , respectively, related to stock options. Warrants The following table summarizes information about warrant activity during the nine months ended June 30, 2017 : Warrants Weighted Weighted Average Remaining Contractual Term Outstanding at Outstanding at September 30, 2016 23,029 $ 5.00 0.75 Issued (Note 19) 12,437,916 $ 3.25 4.56 Forfeited or expired (1,471 ) $ 5.00 Outstanding and exercisable at June 30, 2017 12,459,474 $ 3.25 4.55 Restricted Stock Units In January 2017, the Company granted 625,000 restricted stock units ("RSU") to the Company's Chief Executive Officer. One RSU gives the right to one share of the Company’s common stock. RSUs shall vest as follows: (1) 312,500 shall equally vest in 25% increments on the anniversary date of the grant date over the next four years; (2) 52,083 shall vest based upon the Company first achieving a market capitalization of $75,000,000 for 30 consecutive trading days; 52,083 shall vest based upon the Company first achieving a market capitalization of $100,000,000 for 30 consecutive trading days; 52,084 shall vest based upon the Company first achieving a market capitalization of $150,000,000 for 30 consecutive trading days; and (3) 52,083 shall vest based upon the Company’s EBITDA first being equal to or greater than $10,000,000 at the end of a fiscal year; 52,083 shall vest based upon the Company’s EBITDA first being equal to or greater than $15,000,000 at the end of a fiscal year; 52,084 shall vest based upon the Company’s EBITDA first being equal to or greater than $25,000,000 at the end of a fiscal year. RSUs that vest based on service and performance are measured based on the fair market values of the underlying stock on the date of grant. The Company used a Lattice model to determine the fair value of the RSUs with a market condition. For the three and nine months ended June 30, 2017 , the Company recognized compensation expense of $129,000 and $312,000 , respectively, related to RSUs. At June 30, 2017 , unrecognized compensation with respect to RSUs amounted to $1,150,000 , assuming all performance-based compensation will vest. In July 2017, the Company granted 625,000 RSUs to certain officers and senior managers of which 312,500 shall vest over four years, 156,250 shall vest based on the Company achieving certain performance criteria and 156,250 shall vest based on the Company achieving certain market criteria. |
SHARE REPURCHASE
SHARE REPURCHASE | 9 Months Ended |
Jun. 30, 2017 | |
Stockholders' Equity Note [Abstract] | |
SHARE REPURCHASE | SHARE REPURCHASE In August 2015, the Company’s Board of Directors authorized the repurchase of up to $2 million of the Company’s common stock. Share repurchases, if any, will be made using a variety of methods, which may include open market purchases, privately negotiated transactions or block trades, or any combination of such methods, in accordance with applicable insider trading and other securities laws and regulations. The Company's Board did not stipulate an expiration date for this repurchase and the purchase decisions are at the discretion of the Company's management. During the three and nine months ended June 30, 2017 , the Company did not repurchase any shares. During the nine months ended June 30, 2016 , the Company repurchased 33,933 common shares at a cost of approximately $86,000 . |
INCOME TAXES
INCOME TAXES | 9 Months Ended |
Jun. 30, 2017 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES The Company files a consolidated federal income tax return and certain combined state and local income tax returns with its subsidiaries. Income taxes for the three and nine month periods ended June 30, 2017 and 2016 is based on the estimated annual effective tax rate. Each quarter the Company updates its estimate of the annual effective tax rate and records cumulative adjustments as necessary. The effective tax rate for the three and nine month periods ended June 30, 2017 and 2016 differs from the federal statutory income tax rate principally due to non-deductible expenses, state and local income taxes and non-taxable changes in the fair value of warrants. Further, the three month period in 2017 reflects a cumulation adjustment to reflect a reduction in the estimated annual effective tax rate. At June 30, 2017 , the Company's net deferred tax asset is principally comprised of net operating loss carryforwards. Management believes that is more likely than not that its deferred tax assets will be realized and, accordingly, has not provided a valuation allowance against such amount. |
SEGMENT INFORMATION
SEGMENT INFORMATION | 9 Months Ended |
Jun. 30, 2017 | |
Segment Reporting [Abstract] | |
SEGMENT INFORMATION | SEGMENT INFORMATION The Company has two reportable segments. The brokerage and advisory services segment includes broker-dealer and investment advisory services, the sale of insurance products and licensed mortgage brokerage services provided by the Broker-Dealer Subsidiaries, NAM, National Insurance, Prime Financial and GC. The tax and accounting services segment includes tax preparation and accounting services provided by Gilman. The Corporate pre-tax income (loss) consists of certain items that have not been allocated to reportable segments. Segment information for the three and nine months ended June 30, 2017 and 2016 is as follows: Brokerage and Tax and Corporate Total Three Months Ended June 30, 2017 Revenues $ 45,520,000 $ 2,527,000 $ — $ 48,047,000 Pre-tax income (loss) 820,000 596,000 (1,478,000 ) (a) (62,000 ) Assets 46,802,000 3,536,000 14,282,000 (b) 64,620,000 Depreciation and amortization 155,000 44,000 89,000 288,000 Interest 5,000 — — 5,000 Capital expenditures 30,000 7,000 915,000 952,000 2016 Revenues $ 43,956,000 $ 2,386,000 $ — $ 46,342,000 Pre-tax income (loss) 1,741,000 198,000 (2,224,000 ) (c) (285,000 ) Assets 40,798,000 3,006,000 18,469,000 (b) 62,273,000 Depreciation and amortization 185,000 44,000 73,000 302,000 Interest — — 13,000 13,000 Capital expenditures 48,000 — 155,000 203,000 Brokerage and Tax and Corporate Total Nine Months Ended June 30, 2017 Revenues $ 137,973,000 $ 6,527,000 $ — $ 144,500,000 Pre-tax income 7,394,000 983,000 2,909,000 (d) 11,286,000 Assets 46,802,000 3,536,000 14,282,000 (b) 64,620,000 Depreciation and amortization 468,000 137,000 266,000 871,000 Interest 13,000 — — 13,000 Capital expenditures 57,000 71,000 1,178,000 1,306,000 2016 Revenues $ 120,775,000 $ 7,222,000 $ — $ 127,997,000 Pre-tax income (loss) 3,173,000 399,000 (3,885,000 ) (c) (313,000 ) Assets 40,798,000 3,006,000 18,469,000 (b) 62,273,000 Depreciation and amortization 569,000 132,000 197,000 898,000 Interest 1,000 — 15,000 16,000 Capital expenditures 53,000 28,000 389,000 470,000 (a) Consists of fair value loss on warrants and operating expenses not allocated to reportable segments. (b) Consists principally of deferred tax asset. (c) Consists of operating expenses not allocated to reportable segments. (d) Consists of fair value gain on warrants offset by operating expenses not allocated to reportable segments. |
ACQUISITION OF CONTROLLING INTE
ACQUISITION OF CONTROLLING INTEREST IN THE COMPANY | 9 Months Ended |
Jun. 30, 2017 | |
Business Combinations [Abstract] | |
ACQUISITION OF CONTROLLING INTEREST IN THE COMPANY | BUSINESS COMBINATION, CONTINGENT CONSIDERATION AND DISPOSAL OF BRANCHES Business Combination In October 2016, Gilman acquired certain assets of a tax preparation and accounting business that was deemed to be a business acquisition. The consideration for the transaction consisted of a cash payment at closing of $19,000 and contingent consideration payable in cash having a fair value of $192,000 , for which a liability (included in Accounts payable and accrued expenses) was recognized based on the estimated acquisition date fair value of the potential earn-out. The earn-out is based on revenue, as defined in the acquisition agreement, during the 36 -month period following the closing up to a maximum of $225,600 . The liability was valued using an income-based approach using unobservable inputs (Level 3) and reflects the Company’s own assumptions. The liability will be revalued at each Balance Sheet date with changes therein recorded in earnings. The fair value of the acquired assets was allocated to customer relationships, which is being amortized over three years. Results of operations of the acquired business are included in the accompanying condensed consolidated statements of operations from the date of acquisition and were not material. In addition, based on materiality, pro forma results are not presented. Contingent Consideration Set below are changes in the carrying value of contingent consideration for the nine months ended June 30, 2017 related to acquisitions: Fair value of contingent consideration at September 30, 2016 $ 424,000 Fair value of contingent consideration in connection with above acquisition 192,000 Payments — Change in fair value 21,000 Fair value of contingent consideration at June 30, 2017 $ 637,000 Disposal of Gilman Branches In January 2017, the Company sold two of its Gilman branches for notes in the aggregate principal amounts of $638,000 which, after allocating a portion of goodwill and unamortized intangibles of $305,000 and $203,000 , respectively, resulted in a gain on disposal of $130,000 . Principal and interest on the notes is payable monthly over 83 to 95 months with interest at 3% to 4% per annum. ACQUISITION OF CONTROLLING INTEREST IN THE COMPANY On September 12, 2016, FBIO Acquisition, Inc. (“FBIO Acquisition”), a wholly-owned subsidiary of Fortress, completed a tender offer (the “Offer”) for all outstanding shares of the Company at a price of $3.25 per share, net to the seller in cash (less any required withholding taxes and without interest) (the “Offer Price”), pursuant to the terms of an Agreement and Plan of Merger dated as of April 27, 2016 (as amended, the “Merger Agreement”) among the Company, Fortress and FBIO Acquisition. The Offer expired on September 9, 2016, and a total of 7,037,482 shares were validly tendered and not withdrawn (including shares delivered through notices of guaranteed delivery), representing approximately 56.6% of the Company's issued and outstanding shares of common stock immediately following the completion of the Offer (in each case, without giving effect to the issuance or exercise of the Dividend Warrants). On September 12, 2016, FBIO Acquisition accepted for payment all shares that were validly tendered and not withdrawn prior to the expiration time of the Offer (such time of acceptance, the "Acceptance Time") and delivered payment for such shares. Dividend Warrants In accordance with the Merger Agreement, since less than 80% of the Company's issued and outstanding shares of common stock were tendered, the Company remains a publicly-traded company and stockholders post-tender offer received from the Company a five year warrant per held share to purchase an additional share of the Company's common stock at $3.25 as a dividend to all holders of the Company's common stock. As the Company does not have the ability to settle the warrants with unregistered shares and maintenance of an effective registration statement (which did not exist at September 30, 2016) may be considered outside of the Company’s control, net cash settlement of the warrants is assumed. Accordingly, as the Company was obligated to issue the warrants at September 30, 2016 , and subsequently issued the warrants in January 2017, the fair value of the 12,437,916 warrants are being classified as a liability in the condensed consolidated statement of financial condition at June 30, 2017 and September 30, 2016 . This liability is subject to re-measurement at each balance sheet date until the warrants are exercised or expired, and any change in fair value is recognized as “change in fair value of warrants” in the condensed consolidated statements of operations. As the warrants were registered and trading and the Company maintained an effective registration statement at June 30, 2017 , fair value of the warrants was based on the market price. As of September 30, 2016 , valuation was determined by use of the Black-Scholes option pricing model using the following assumptions: Fiscal Year 2016 Dividend yield 0.00 % Expected volatility 38.20 % Risk-free interest rate 1.14 % Life (in years) 5 |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 9 Months Ended |
Jun. 30, 2017 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | RELATED PARTY TRANSACTIONS During the three and nine months ended June 30, 2017 , Investment Banking revenues include approximately $3,679,000 and $12,260,000 , respectively, of fees related to placement of shares and warrants for Fortress and subsidiaries of Fortress. |
VARIABLE INTEREST ENTITIES
VARIABLE INTEREST ENTITIES | 9 Months Ended |
Jun. 30, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
VARIABLE INTEREST ENTITIES | VARIABLE INTEREST ENTITIES The Company has entered into agreements to provide investment banking and advisory services to numerous entities that are variable interest entities ("VIEs") under the accounting guidance. As the fee arrangements under such agreements are arm's-length and contain customary terms and conditions and represent compensation that is considered fair value for the services provided, the fee arrangements are not considered variable interests and accordingly, the Company does not consolidate such VIEs. Fees attributable to such arrangements for the three months ended June 30, 2017 and 2016 were $6,071,000 and $6,283,000 , respectively. Fees attributable to such arrangements for the nine months ended June 30, 2017 and 2016 were $14,033,000 and $13,335,000 , respectively. |
NEW ACCOUNTING GUIDANCE (Polici
NEW ACCOUNTING GUIDANCE (Policies) | 9 Months Ended |
Jun. 30, 2017 | |
Accounting Policies [Abstract] | |
New Accounting Guidance | In May 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2014-09, Revenue From Contracts With Customers (Topic 606) which creates a single, principle-based model for revenue recognition and expands and improves disclosures about revenue. The new guidance is effective for the Company beginning October 1, 2018, and must be adopted using either a full retrospective approach for all periods presented in the period of adoption or a modified retrospective approach. The Company is currently evaluating the potential impact of this standard on its financial statements which, (1) for investment banking advisory arrangements may change the timing of revenue recognition depending on the number and nature of the performance obligations identified, (2) for underwriting expenses and costs of advisory services and related reimbursement revenue may need to be recognized on a gross basis, and (3) for costs to obtain a contract may need to be capitalized, amortized and reviewed regularly for impairment. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842), which supersedes the existing guidance for lease accounting, Leases (Topic 840). ASU 2016-02 requires lessees to recognize leases on their balance sheets, and leaves lessor accounting largely unchanged. The amendments in this ASU are effective for the Company beginning October 1, 2019 and interim periods within those fiscal years. Early application is permitted for all entities. ASU 2016-02 requires a modified retrospective approach for all leases existing at, or entered into after, the date of initial application, with an option to elect to use certain transition relief. The Company is currently assessing the impact that the adoption of ASU 2016-02 will have on its financial statements. In March 2016, the FASB issued ASU 2016-09, “Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting”. ASU 2016-09 simplifies several aspects of the accounting for employee share-based payment transactions, including the accounting for income taxes, forfeitures and statutory tax withholding requirements, as well as classification in the statement of cash flows. ASU 2016-09 is effective for the Company beginning October 1, 2017 for both interim and annual reporting periods. The Company is currently assessing the impact that the adoption of ASU 2016-09 will have on its financial statements. In August 2016, the FASB issued ASU 2016-15, “Statement of Cash Flows (Topic 230) - Classification of Certain Cash Receipts and Cash Payments”. ASU 2016-15 reduces the diversity of how certain cash receipts and cash payments are presented and classified in the statement of cash flows under Topic 230, Statement of Cash Flows, and other Topics. The standard is effective for the Company beginning October 1, 2018 for both interim and annual periods. Early adoption is permitted. The ASU should be applied retrospectively to all periods presented. The Company does not anticipate that the adoption of ASU 2016-15 will have a material impact on its financial statements. In November 2016, the FASB issued ASU 2016-18, “Statement of Cash Flows (Topic 230) - Restricted Cash”. ASU 2016-18 reduces the diversity in the presentation of restricted cash and restricted cash equivalents in the statement. The statement requires that restricted cash and restricted cash equivalents be included as components of total cash and cash equivalents as presented on the statement of cash flows. The standard is effective for the Company beginning October 1, 2018 for both interim and annual periods. Early adoption is permitted. The ASU should be applied retrospectively to all periods presented. The Company is currently assessing the impact that the adoption of ASU 2016-18 will have on its financial statements. In January 2017, the FASB issued ASU 2017-01, “Business Combinations (Topic 805): Clarifying the Definition of a Business”. The amendments in this Update is to clarify the definition of a business with the objective of adding guidance to assist entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. The definition of a business affects many areas of accounting including acquisitions, disposals, goodwill, and consolidation. The standard is effective for the Company beginning October 1, 2018 for both interim and annual periods. The Company is currently assessing the impact that the adoption of ASU 2017-01 will have on its financial statements. In January 2017, FASB issued ASU 2017-04, "Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment", which eliminates the second step of the previous FASB guidance for testing goodwill for impairment and is intended to reduce cost and complexity of goodwill impairment testing. The standard is effective for the Company beginning October 1, 2020 for both interim and annual periods. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. The Company is currently assessing the impact that the adoption of ASU 2017-04 will have on its financial statements. In May 2017, the FASB issued ASU 2017-09, “Scope of Modification Accounting”. This ASU clarifies when changes to the terms or conditions of a share-based payment award must be accounted for as modifications. Under the new guidance, modification accounting is required only if the fair value, the vesting conditions, or the classification of the award (as equity or liability) changes as a result of the change in terms or conditions. The standard is effective for the Company beginning October 1, 2018 for both interim and annual periods. Early adoption is permitted. The Company is currently assessing the impact that the adoption of ASU 2017-09 will have on its financial statements. |
FORGIVABLE LOANS RECEIVABLE (Ta
FORGIVABLE LOANS RECEIVABLE (Tables) | 9 Months Ended |
Jun. 30, 2017 | |
Investments in and Advances to Affiliates, Schedule of Investments [Abstract] | |
Forgivable Loan Activity | Forgivable loan activity for the nine months ended June 30, 2017 is as follows: Balance, October 1, 2016 $ 1,712,000 Additions 77,000 Amortization (520,000 ) Balance, June 30, 2017 $ 1,269,000 |
FAIR VALUE OF ASSETS AND LIAB30
FAIR VALUE OF ASSETS AND LIABILITIES (Tables) | 9 Months Ended |
Jun. 30, 2017 | |
Schedule of Investments [Abstract] | |
Carrying Values, Estimated Fair Values, and Fair Value Hierarchy of Financial Assets and Liabilities Measured on a Recurring Basis | The following tables present the carrying values and estimated fair values at June 30, 2017 and September 30, 2016 of financial assets and liabilities, excluding financial instruments that are carried at fair value on a recurring basis, and information is provided on their classification within the fair value hierarchy. Such instruments are carried at amounts that approximate fair value due to their short-term nature and generally negligible credit risk. June 30, 2017 Assets Carrying Value Level 1 Level 2 Total Estimated Fair Value Cash $ 28,205,000 $ 28,205,000 $ — $ 28,205,000 Cash deposits with clearing organizations 1,040,000 1,040,000 — 1,040,000 Receivables from broker-dealers and clearing organizations 2,786,000 — 2,786,000 2,786,000 Forgivable loans receivable (1) 1,269,000 — 1,269,000 1,269,000 Other Receivables, Net 4,748,000 — 4,748,000 4,748,000 $ 38,048,000 $ 29,245,000 $ 8,803,000 $ 38,048,000 Liabilities Accrued commissions and payroll payable 11,255,000 — 11,255,000 11,255,000 Accounts payable and accrued expenses (2) 7,871,000 — 7,871,000 7,871,000 $ 19,126,000 $ — $ 19,126,000 $ 19,126,000 (1) Carrying value approximates fair value, which is determined based on a valuation technique to convert future cash payments or forgiveness transactions to a single discounted preset value amount. (2) Excludes contingent consideration liabilities of $637,000 . September 30, 2016 Assets Carrying Value Level 1 Level 2 Total Estimated Fair Value Cash $ 21,694,000 $ 21,694,000 $ — $ 21,694,000 Cash deposits with clearing organizations 1,030,000 1,030,000 — 1,030,000 Receivables from broker-dealers and clearing organizations 3,357,000 — 3,357,000 3,357,000 Forgivable loans receivable (1) 1,712,000 — 1,712,000 1,712,000 Other Receivables, Net 5,430,000 — 5,430,000 5,430,000 $ 33,223,000 $ 22,724,000 $ 10,499,000 $ 33,223,000 Liabilities Accrued commissions and payroll payable 11,940,000 — 11,940,000 11,940,000 Accounts payable and accrued expenses (2) 6,742,000 — 6,742,000 6,742,000 $ 18,682,000 $ — $ 18,682,000 $ 18,682,000 (1) Carrying value approximates fair value, which is determined based on a valuation technique to convert future cash payments or forgiveness transactions to a single discounted preset value amount. (2) Excludes contingent consideration liabilities of $424,000 . The following tables present the financial assets and liabilities measured at fair value on a recurring basis at June 30, 2017 and September 30, 2016 : June 30, 2017 Assets Carrying Value Level 1 Level 2 Level 3 Total Estimated Fair Value Corporate stocks $ 70,000 $ 70,000 $ — $ — $ 70,000 Municipal bonds 1,333,000 816,000 517,000 — 1,333,000 Restricted stock 192,000 — 192,000 — 192,000 $ 1,595,000 $ 886,000 $ 709,000 $ — $ 1,595,000 Liabilities Contingent consideration 637,000 — — 637,000 637,000 Warrants issued 8,832,000 — 8,832,000 — 8,832,000 $ 9,469,000 $ — $ 8,832,000 $ 637,000 $ 9,469,000 September 30, 2016 Assets Carrying Value Level 1 Level 2 Level 3 Total Estimated Fair Value Corporate stocks $ 101,000 $ 101,000 $ — $ — $ 101,000 Municipal bonds 2,111,000 2,111,000 — — 2,111,000 Restricted stock 145,000 — 145,000 — 145,000 $ 2,357,000 $ 2,212,000 $ 145,000 $ — $ 2,357,000 Liabilities Contingent consideration 424,000 — — 424,000 424,000 Warrants issuable 14,055,000 — 14,055,000 — 14,055,000 Corporate stocks 298,000 298,000 — — 298,000 $ 14,777,000 $ 298,000 $ 14,055,000 $ 424,000 $ 14,777,000 |
FIXED ASSETS (Tables)
FIXED ASSETS (Tables) | 9 Months Ended |
Jun. 30, 2017 | |
Property, Plant and Equipment [Abstract] | |
Fixed Assets | Fixed assets as of June 30, 2017 and September 30, 2016 consist of the following: June 30, September 30, Estimated Useful Lives Equipment and software $ 1,741,000 $ 1,036,000 5 Furniture and fixtures 338,000 163,000 5 Leasehold improvements 1,079,000 653,000 Lesser of useful Capital leases (primarily composed of computer equipment) 739,000 739,000 5 3,897,000 2,591,000 Less accumulated depreciation and amortization (1,705,000 ) (1,427,000 ) Fixed assets – net $ 2,192,000 $ 1,164,000 |
BUSINESS COMBINATION, CONTING32
BUSINESS COMBINATION, CONTINGENT CONSIDERATION AND DISPOSAL OF BRANCHES (Tables) | 9 Months Ended |
Jun. 30, 2017 | |
Business Combinations [Abstract] | |
Changes in the Carrying Value in Contingent Consideration | Set below are changes in the carrying value of contingent consideration for the nine months ended June 30, 2017 related to acquisitions: Fair value of contingent consideration at September 30, 2016 $ 424,000 Fair value of contingent consideration in connection with above acquisition 192,000 Payments — Change in fair value 21,000 Fair value of contingent consideration at June 30, 2017 $ 637,000 |
INTANGIBLE ASSETS (Tables)
INTANGIBLE ASSETS (Tables) | 9 Months Ended |
Jun. 30, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangibles | Intangibles consisted of the following at June 30, 2017 and September 30, 2016 : June 30, 2017 Intangible asset Cost Accumulated Amortization Carrying Value Estimated Customer relationships $ 6,867,000 $ 2,508,000 $ 4,359,000 3-10 Non-compete 296,000 296,000 — 2 Gilman brand name 760,000 — 760,000 Indefinite $ 7,923,000 $ 2,804,000 $ 5,119,000 September 30, 2016 Intangible asset Cost Accumulated Amortization Carrying Value Estimated Customer relationships $ 6,969,000 $ 2,025,000 $ 4,944,000 7-10 Non-compete 296,000 296,000 — 2 Gilman brand name 760,000 — 760,000 Indefinite $ 8,025,000 $ 2,321,000 $ 5,704,000 |
Estimated Future Amortization Expense | The estimated future amortization expense of the finite lived intangible assets for the next five fiscal years and thereafter is as follows: Year ending Three months ending September 30, 2017 $ 197,000 2018 790,000 2019 790,000 2020 719,000 2021 719,000 Thereafter 1,144,000 Total $ 4,359,000 |
ACCOUNTS PAYABLE AND ACCRUED 34
ACCOUNTS PAYABLE AND ACCRUED EXPENSES (Tables) | 9 Months Ended |
Jun. 30, 2017 | |
Payables and Accruals [Abstract] | |
Accounts Payable and Accrued Expenses | Accounts payable and accrued expenses as of June 30, 2017 and September 30, 2016 consist of the following: June 30, September 30, Legal $ 836,000 $ 1,346,000 Audit 148,000 198,000 Telecommunications 196,000 209,000 Data services 450,000 425,000 Regulatory 661,000 444,000 Settlements 2,633,000 832,000 Contingent consideration payable 636,000 424,000 Deferred rent 177,000 65,000 Income taxes payable 927,000 — Other 1,844,000 3,223,000 Total $ 8,508,000 $ 7,166,000 |
PER SHARE DATA (Tables)
PER SHARE DATA (Tables) | 9 Months Ended |
Jun. 30, 2017 | |
Earnings Per Share [Abstract] | |
Reconciliation of Basic and Diluted Common Shares | A reconciliation of basic and diluted common shares used in the computation of per share data follows: Three Month Period Ended June 30, Nine Month Period Ended June 30, 2017 2016 2017 2016 Basic weighted-average shares 12,437,916 12,440,035 12,437,916 12,442,059 Effect of dilutive securities: Options — — 186 — Unvested restricted stock units — — 21,732 — Warrants — — — — Diluted weighted-average shares 12,437,916 12,440,035 12,459,834 12,442,059 |
Potential Common Share Equivalents Excluded from Diluted Computation | The following potential common share equivalents are not included in the above diluted computation because to do so would be anti-dilutive as the instruments are out of the money: Three Month Period Ended June 30, Nine Month Period Ended June 30, 2017 2016 2017 2016 Options 1,206,000 1,224,500 1,207,333 1,311,167 Warrants 12,459,474 (a) 43,116 8,313,502 (a) 43,116 Restricted stock units 312,500 — — — 13,977,974 1,267,616 9,520,835 1,354,283 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 9 Months Ended |
Jun. 30, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Future Minimum Lease Payments | The Company leases office space in various states expiring at various dates through October 2026, and as of June 30, 2017 , is committed under operating leases for future minimum lease payments as follows: Fiscal Year Ending Lease Payments Three months ending September 30, 2017 $ 711,000 2018 3,138,000 2019 2,634,000 2020 2,415,000 2021 2,096,000 Thereafter 5,855,000 $ 16,849,000 |
STOCKHOLDERS' EQUITY (Tables)
STOCKHOLDERS' EQUITY (Tables) | 9 Months Ended |
Jun. 30, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock Option Activity | Information with respect to stock option activity during the nine months ended June 30, 2017 follows: Options Weighted Weighted Weighted Aggregate Outstanding at September 30, 2016 1,221,500 $ 6.51 $ 1.22 3.31 $ — Forfeited (15,500 ) $ 4.42 $ 1.99 $ — Outstanding at June 30, 2017 1,206,000 $ 6.54 $ 1.21 2.54 $ — Vested and exercisable at June 30, 2017 1,206,000 $ 6.54 $ 1.21 2.54 $ — |
Warrant Activity | The following table summarizes information about warrant activity during the nine months ended June 30, 2017 : Warrants Weighted Weighted Average Remaining Contractual Term Outstanding at Outstanding at September 30, 2016 23,029 $ 5.00 0.75 Issued (Note 19) 12,437,916 $ 3.25 4.56 Forfeited or expired (1,471 ) $ 5.00 Outstanding and exercisable at June 30, 2017 12,459,474 $ 3.25 4.55 |
SEGMENT INFORMATION (Tables)
SEGMENT INFORMATION (Tables) | 9 Months Ended |
Jun. 30, 2017 | |
Segment Reporting [Abstract] | |
Segment Information | Segment information for the three and nine months ended June 30, 2017 and 2016 is as follows: Brokerage and Tax and Corporate Total Three Months Ended June 30, 2017 Revenues $ 45,520,000 $ 2,527,000 $ — $ 48,047,000 Pre-tax income (loss) 820,000 596,000 (1,478,000 ) (a) (62,000 ) Assets 46,802,000 3,536,000 14,282,000 (b) 64,620,000 Depreciation and amortization 155,000 44,000 89,000 288,000 Interest 5,000 — — 5,000 Capital expenditures 30,000 7,000 915,000 952,000 2016 Revenues $ 43,956,000 $ 2,386,000 $ — $ 46,342,000 Pre-tax income (loss) 1,741,000 198,000 (2,224,000 ) (c) (285,000 ) Assets 40,798,000 3,006,000 18,469,000 (b) 62,273,000 Depreciation and amortization 185,000 44,000 73,000 302,000 Interest — — 13,000 13,000 Capital expenditures 48,000 — 155,000 203,000 Brokerage and Tax and Corporate Total Nine Months Ended June 30, 2017 Revenues $ 137,973,000 $ 6,527,000 $ — $ 144,500,000 Pre-tax income 7,394,000 983,000 2,909,000 (d) 11,286,000 Assets 46,802,000 3,536,000 14,282,000 (b) 64,620,000 Depreciation and amortization 468,000 137,000 266,000 871,000 Interest 13,000 — — 13,000 Capital expenditures 57,000 71,000 1,178,000 1,306,000 2016 Revenues $ 120,775,000 $ 7,222,000 $ — $ 127,997,000 Pre-tax income (loss) 3,173,000 399,000 (3,885,000 ) (c) (313,000 ) Assets 40,798,000 3,006,000 18,469,000 (b) 62,273,000 Depreciation and amortization 569,000 132,000 197,000 898,000 Interest 1,000 — 15,000 16,000 Capital expenditures 53,000 28,000 389,000 470,000 (a) Consists of fair value loss on warrants and operating expenses not allocated to reportable segments. (b) Consists principally of deferred tax asset. (c) Consists of operating expenses not allocated to reportable segments. (d) Consists of fair value gain on warrants offset by operating expenses not allocated to reportable segments. |
ACQUISITION OF CONTROLLING IN39
ACQUISITION OF CONTROLLING INTEREST IN THE COMPANY (Tables) | 9 Months Ended |
Jun. 30, 2017 | |
Business Combinations [Abstract] | |
Valuation Assumptions | As of September 30, 2016 , valuation was determined by use of the Black-Scholes option pricing model using the following assumptions: Fiscal Year 2016 Dividend yield 0.00 % Expected volatility 38.20 % Risk-free interest rate 1.14 % Life (in years) 5 |
RECEIVEABLES FROM BROKER-DEAL40
RECEIVEABLES FROM BROKER-DEALERS AND CLEARING ORGANIZATIONS AND OTHER RECEIVABLES (Details) $ in Thousands | 9 Months Ended | |
Jun. 30, 2017USD ($)branch | Sep. 30, 2016USD ($) | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Receivables from broker-dealers and clearing organizations | $ 2,786 | $ 3,357 |
Other receivables, net | $ 4,748 | 5,430 |
Number of branches sold | branch | 2 | |
Trailing Fees | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Other receivables, net | $ 1,196 | 1,250 |
Tax and Accounting Services | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Other receivables, net | 546 | 864 |
Allowance for doubtful other receivables | 307 | 581 |
Advances to Registered Representatives | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Other receivables, net | 889 | 918 |
Allowance for doubtful other receivables | 154 | 154 |
Investment Banking | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Other receivables, net | 773 | 1,877 |
Advisory Fees | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Other receivables, net | 486 | $ 597 |
Notes Receivable, Gilman Branch Divestiture | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Other receivables, net | $ 613 |
FORGIVABLE LOANS RECEIVABLE - N
FORGIVABLE LOANS RECEIVABLE - Narrative (Details) - USD ($) | 9 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Sep. 30, 2016 | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Forgiveness of loans balance | $ 520,000 | $ 493,000 | |
Loans Receivable | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Allowance for doubtful accounts receivable | $ 0 | $ 0 | |
Maximum | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Interest rate (as a percent) | 9.00% |
FORGIVABLE LOANS RECEIVABLE - F
FORGIVABLE LOANS RECEIVABLE - Forgivable Loan Activity (Details) $ in Thousands | 9 Months Ended |
Jun. 30, 2017USD ($) | |
Forgivable Loan Activity [Roll Forward] | |
Beginning balance | $ 1,712 |
Additions | 77 |
Amortization | (520) |
Ending balance | $ 1,269 |
FAIR VALUE OF ASSETS AND LIAB43
FAIR VALUE OF ASSETS AND LIABILITIES - Carrying Values and Estimated Fair Values of Financial Assets and Liabilities Measured on a Recurring Basis (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Sep. 30, 2016 |
Liabilities | ||
Contingent consideration liability | $ 637 | $ 424 |
Fair Value, Measurements, Nonrecurring | Carrying Value | ||
Assets | ||
Receivables from broker-dealers and clearing organizations | 2,786 | 3,357 |
Forgivable loans receivable | 1,269 | 1,712 |
Other Receivables, Net | 4,748 | 5,430 |
Total assets, excluding financial instruments | 38,048 | 33,223 |
Liabilities | ||
Accrued commissions and payroll payable | 11,255 | 11,940 |
Accounts payable and accrued expenses | 7,871 | 6,742 |
Total liabilities, excluding financial instruments | 19,126 | 18,682 |
Fair Value, Measurements, Nonrecurring | Total Estimated Fair Value | ||
Assets | ||
Receivables from broker-dealers and clearing organizations | 2,786 | 3,357 |
Forgivable loans receivable | 1,269 | 1,712 |
Other Receivables, Net | 4,748 | 5,430 |
Total assets, excluding financial instruments | 38,048 | 33,223 |
Liabilities | ||
Accrued commissions and payroll payable | 11,255 | 11,940 |
Accounts payable and accrued expenses | 7,871 | 6,742 |
Total liabilities, excluding financial instruments | 19,126 | 18,682 |
Fair Value, Measurements, Nonrecurring | Total Estimated Fair Value | Level 1 | ||
Assets | ||
Receivables from broker-dealers and clearing organizations | 0 | 0 |
Forgivable loans receivable | 0 | 0 |
Other Receivables, Net | 0 | 0 |
Total assets, excluding financial instruments | 29,245 | 22,724 |
Liabilities | ||
Accrued commissions and payroll payable | 0 | 0 |
Accounts payable and accrued expenses | 0 | 0 |
Total liabilities, excluding financial instruments | 0 | 0 |
Fair Value, Measurements, Nonrecurring | Total Estimated Fair Value | Level 2 | ||
Assets | ||
Receivables from broker-dealers and clearing organizations | 2,786 | 3,357 |
Forgivable loans receivable | 1,269 | 1,712 |
Other Receivables, Net | 4,748 | 5,430 |
Total assets, excluding financial instruments | 8,803 | 10,499 |
Liabilities | ||
Accrued commissions and payroll payable | 11,255 | 11,940 |
Accounts payable and accrued expenses | 7,871 | 6,742 |
Total liabilities, excluding financial instruments | 19,126 | 18,682 |
Cash | Fair Value, Measurements, Nonrecurring | Carrying Value | ||
Assets | ||
Cash and cash equivalents | 28,205 | 21,694 |
Cash | Fair Value, Measurements, Nonrecurring | Total Estimated Fair Value | ||
Assets | ||
Cash and cash equivalents | 28,205 | 21,694 |
Cash | Fair Value, Measurements, Nonrecurring | Total Estimated Fair Value | Level 1 | ||
Assets | ||
Cash and cash equivalents | 28,205 | 21,694 |
Cash | Fair Value, Measurements, Nonrecurring | Total Estimated Fair Value | Level 2 | ||
Assets | ||
Cash and cash equivalents | 0 | 0 |
Cash deposits with clearing organizations | Fair Value, Measurements, Nonrecurring | Carrying Value | ||
Assets | ||
Cash and cash equivalents | 1,040 | 1,030 |
Cash deposits with clearing organizations | Fair Value, Measurements, Nonrecurring | Total Estimated Fair Value | ||
Assets | ||
Cash and cash equivalents | 1,040 | 1,030 |
Cash deposits with clearing organizations | Fair Value, Measurements, Nonrecurring | Total Estimated Fair Value | Level 1 | ||
Assets | ||
Cash and cash equivalents | 1,040 | 1,030 |
Cash deposits with clearing organizations | Fair Value, Measurements, Nonrecurring | Total Estimated Fair Value | Level 2 | ||
Assets | ||
Cash and cash equivalents | $ 0 | $ 0 |
FAIR VALUE OF ASSETS AND LIAB44
FAIR VALUE OF ASSETS AND LIABILITIES - Fair Value Hierarchy of Financial Assets and Liabilities (Details) - Fair Value, Measurements, Recurring - USD ($) $ in Thousands | Jun. 30, 2017 | Sep. 30, 2016 |
Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets | $ 886 | $ 2,212 |
Liabilities | 0 | 298 |
Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets | 709 | 145 |
Liabilities | 8,832 | 14,055 |
Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets | 0 | 0 |
Liabilities | 637 | 424 |
Carrying Value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets | 1,595 | 2,357 |
Liabilities | 9,469 | 14,777 |
Total Estimated Fair Value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets | 1,595 | 2,357 |
Liabilities | 9,469 | 14,777 |
Contingent consideration | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Liabilities | 0 | 0 |
Contingent consideration | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Liabilities | 0 | 0 |
Contingent consideration | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Liabilities | 637 | 424 |
Contingent consideration | Carrying Value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Liabilities | 637 | 424 |
Contingent consideration | Total Estimated Fair Value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Liabilities | 637 | 424 |
Warrants issued | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Liabilities | 0 | 0 |
Warrants issued | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Liabilities | 8,832 | 14,055 |
Warrants issued | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Liabilities | 0 | 0 |
Warrants issued | Carrying Value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Liabilities | 8,832 | 14,055 |
Warrants issued | Total Estimated Fair Value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Liabilities | 8,832 | 14,055 |
Corporate stocks | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Liabilities | 298 | |
Corporate stocks | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Liabilities | 0 | |
Corporate stocks | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Liabilities | 0 | |
Corporate stocks | Carrying Value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Liabilities | 298 | |
Corporate stocks | Total Estimated Fair Value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Liabilities | 298 | |
Corporate stocks | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets | 70 | 101 |
Corporate stocks | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets | 0 | 0 |
Corporate stocks | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets | 0 | 0 |
Corporate stocks | Carrying Value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets | 70 | 101 |
Corporate stocks | Total Estimated Fair Value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets | 70 | 101 |
Municipal bonds | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets | 816 | 2,111 |
Municipal bonds | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets | 517 | 0 |
Municipal bonds | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets | 0 | 0 |
Municipal bonds | Carrying Value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets | 1,333 | 2,111 |
Municipal bonds | Total Estimated Fair Value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets | 1,333 | 2,111 |
Restricted stock | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets | 0 | 0 |
Restricted stock | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets | 192 | 145 |
Restricted stock | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets | 0 | 0 |
Restricted stock | Carrying Value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets | 192 | 145 |
Restricted stock | Total Estimated Fair Value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets | $ 192 | $ 145 |
FIXED ASSETS - Fixed Assets (De
FIXED ASSETS - Fixed Assets (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Jun. 30, 2017 | Sep. 30, 2016 | |
Property, Plant and Equipment [Line Items] | ||
Property, Plant, and Equipment | $ 3,897 | $ 2,591 |
Less accumulated depreciation and amortization | (1,705) | (1,427) |
Fixed assets – net | 2,192 | 1,164 |
Equipment and software | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant, and Equipment | $ 1,741 | 1,036 |
Estimated Useful Lives | 5 years | |
Furniture and fixtures | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant, and Equipment | $ 338 | 163 |
Estimated Useful Lives | 5 years | |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant, and Equipment | $ 1,079 | 653 |
Capital leases (primarily composed of computer equipment) | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant, and Equipment | $ 739 | $ 739 |
Estimated Useful Lives | 5 years |
FIXED ASSETS - Narrative (Detai
FIXED ASSETS - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Property, Plant and Equipment [Abstract] | ||||
Depreciation expense | $ 91 | $ 122 | $ 278 | $ 345 |
BUSINESS COMBINATION, CONTING47
BUSINESS COMBINATION, CONTINGENT CONSIDERATION AND DISPOSAL OF BRANCHES - Narrative (Details) | 1 Months Ended | 3 Months Ended | 9 Months Ended | ||||
Jan. 31, 2017USD ($)branch | Oct. 31, 2016USD ($) | Jun. 30, 2017USD ($) | Jun. 30, 2016USD ($) | Jun. 30, 2017USD ($)branch | Jun. 30, 2016USD ($) | Sep. 30, 2016USD ($) | |
Business Acquisition [Line Items] | |||||||
Payments to acquire business | $ 19,000 | $ 0 | |||||
Contingent consideration liability | $ 637,000 | $ 637,000 | $ 424,000 | ||||
Earn-out period, maximum revenue | $ 225,600 | ||||||
Estimated useful life | 3 years | ||||||
Number of branches sold | branch | 2 | ||||||
Gain on disposal of Gilman branches | $ 0 | $ 0 | $ 130,000 | $ 0 | |||
Maximum | |||||||
Business Acquisition [Line Items] | |||||||
Interest rate (as a percent) | 9.00% | ||||||
Gilman Branches | |||||||
Business Acquisition [Line Items] | |||||||
Number of branches sold | branch | 2 | ||||||
Consideration for divestiture, notes receivable | $ 638,000 | ||||||
Disposal of goodwill | 305,000 | ||||||
Disposal of intangible assets | 203,000 | ||||||
Gain on disposal of Gilman branches | $ 130,000 | ||||||
Gilman Branches | Minimum | |||||||
Business Acquisition [Line Items] | |||||||
Notes receivable term | 83 months | ||||||
Interest rate (as a percent) | 3.00% | ||||||
Gilman Branches | Maximum | |||||||
Business Acquisition [Line Items] | |||||||
Notes receivable term | 95 months | ||||||
Interest rate (as a percent) | 4.00% | ||||||
Certain Assets of a Tax Preparation and Accounting Business | |||||||
Business Acquisition [Line Items] | |||||||
Payments to acquire business | 19,000 | ||||||
Contingent consideration liability | $ 192,000 | ||||||
Earn-out period for which the contingent liability is derived | 36 months |
BUSINESS COMBINATION, CONTING48
BUSINESS COMBINATION, CONTINGENT CONSIDERATION AND DISPOSAL OF BRANCHES - Changes in the Carrying Value in Contingent Consideration (Details) $ in Thousands | 9 Months Ended |
Jun. 30, 2017USD ($) | |
Contingent Consideration [Roll Forward] | |
Fair value of contingent consideration, beginning balance | $ 424 |
Fair value of contingent consideration in connection with acquisition | 192 |
Payments | 0 |
Change in fair value | 21 |
Fair value of contingent consideration, ending balance | $ 637 |
INTANGIBLE ASSETS - Intangibles
INTANGIBLE ASSETS - Intangibles (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended |
Jun. 30, 2017 | Sep. 30, 2016 | |
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Cost | $ 7,923 | $ 8,025 |
Accumulated Amortization | 2,804 | 2,321 |
Carrying Value | $ 5,119 | 5,704 |
Estimated Useful Life (years) | 3 years | |
Customer relationships | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Cost | $ 6,867 | 6,969 |
Accumulated Amortization | 2,508 | 2,025 |
Carrying Value | $ 4,359 | $ 4,944 |
Customer relationships | Minimum | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Estimated Useful Life (years) | 3 years | 7 years |
Customer relationships | Maximum | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Estimated Useful Life (years) | 10 years | 10 years |
Non-compete | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Cost | $ 296 | $ 296 |
Accumulated Amortization | 296 | 296 |
Carrying Value | $ 0 | $ 0 |
Estimated Useful Life (years) | 2 years | 2 years |
Gilman brand name | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Cost | $ 760 | $ 760 |
Accumulated Amortization | 0 | 0 |
Carrying Value | $ 760 | $ 760 |
INTANGIBLE ASSETS - Narrative (
INTANGIBLE ASSETS - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||||
Amortization expense | $ 197 | $ 180 | $ 593 | $ 553 |
INTANGIBLE ASSETS - Estimated F
INTANGIBLE ASSETS - Estimated Future Amortization Expense (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Sep. 30, 2016 |
Year ending September 30, | ||
Carrying Value | $ 5,119 | $ 5,704 |
Gilman | ||
Year ending September 30, | ||
Three months ending September 30, 2017 | 197 | |
2,018 | 790 | |
2,019 | 790 | |
2,020 | 719 | |
2,021 | 719 | |
Thereafter | 1,144 | |
Carrying Value | $ 4,359 |
ACCOUNTS PAYABLE AND ACCRUED 52
ACCOUNTS PAYABLE AND ACCRUED EXPENSES (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Sep. 30, 2016 |
Payables and Accruals [Abstract] | ||
Legal | $ 836 | $ 1,346 |
Audit | 148 | 198 |
Telecommunications | 196 | 209 |
Data services | 450 | 425 |
Regulatory | 661 | 444 |
Settlements | 2,633 | 832 |
Contingent consideration payable | 636 | 424 |
Deferred rent | 177 | 65 |
Income taxes payable | 927 | 0 |
Other | 1,844 | 3,223 |
Total | $ 8,508 | $ 7,166 |
PER SHARE DATA - Reconciliation
PER SHARE DATA - Reconciliation of Basic and Diluted Common Shares (Details) - shares | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Basic weighted-average shares | 12,437,916 | 12,440,035 | 12,437,916 | 12,442,059 |
Diluted weighted-average shares | 12,437,916 | 12,440,035 | 12,459,834 | 12,442,059 |
Options | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Effect of dilutive securities | 0 | 0 | 186 | 0 |
Unvested restricted stock units | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Effect of dilutive securities | 0 | 0 | 21,732 | 0 |
Warrants | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Effect of dilutive securities | 0 | 0 | 0 | 0 |
PER SHARE DATA - Potential Comm
PER SHARE DATA - Potential Common Share Equivalents Excluded from Diluted Computation (Details) - shares | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities | 13,977,974 | 1,267,616 | 9,520,835 | 1,354,283 |
Options | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities | 1,206,000 | 1,224,500 | 1,207,333 | 1,311,167 |
Warrants | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities | 12,459,474 | 43,116 | 8,313,502 | 43,116 |
Restricted stock | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities | 312,500 | 0 | 0 | 0 |
COMMITMENTS AND CONTINGENCIES -
COMMITMENTS AND CONTINGENCIES - Future Minimum Lease Payments (Details) $ in Thousands | Jun. 30, 2017USD ($) |
Lease Payments | |
Three months ending September 30, 2017 | $ 711 |
2,018 | 3,138 |
2,019 | 2,634 |
2,020 | 2,415 |
2,021 | 2,096 |
Thereafter | 5,855 |
Total | $ 16,849 |
COMMITMENTS AND CONTINGENCIES56
COMMITMENTS AND CONTINGENCIES - Narrative (Details) | 3 Months Ended | 9 Months Ended | |||
Jun. 30, 2017USD ($) | Jun. 30, 2016USD ($) | Jun. 30, 2017USD ($)Letter_of_credit | Jun. 30, 2016USD ($) | Sep. 30, 2016USD ($) | |
Loss Contingencies [Line Items] | |||||
Rent expense | $ 929,000 | $ 961,000 | $ 2,854,000 | $ 2,880,000 | |
Sublease income | 2,000 | 35,000 | 77,000 | 106,000 | |
Pending Litigation | Other Administrative Expense | |||||
Loss Contingencies [Line Items] | |||||
Estimated loss expense | 2,326,000 | 362,000 | 3,322,000 | 525,000 | |
Pending Litigation | Professional Fees | |||||
Loss Contingencies [Line Items] | |||||
Legal fees | 430,000 | $ 346,000 | 1,229,000 | $ 799,000 | |
Pending Litigation | Accounts Payable and Other Liabilities | |||||
Loss Contingencies [Line Items] | |||||
Estimate of possible loss | 2,633,000 | $ 2,633,000 | $ 832,000 | ||
Letter of Credit | |||||
Loss Contingencies [Line Items] | |||||
Number of letters of credit, outstanding | Letter_of_credit | 3 | ||||
Maximum borrowing capacity | $ 1,380,000 | $ 1,380,000 |
NET CAPITAL REQUIREMENTS (Detai
NET CAPITAL REQUIREMENTS (Details) | Jun. 30, 2017USD ($) |
National Securities | |
Compliance with Regulatory Capital Requirements under Banking Regulations [Line Items] | |
Net capital | $ 10,464,721 |
Alternative excess net capital | 10,214,721 |
National Securities | SEC Requirement | |
Compliance with Regulatory Capital Requirements under Banking Regulations [Line Items] | |
Minimum net capital required | 250,000 |
vFinance Investments | |
Compliance with Regulatory Capital Requirements under Banking Regulations [Line Items] | |
Net capital | 1,534,147 |
Alternative excess net capital | $ 534,147 |
Ratio of indebtedness to net capital | 0.8 |
vFinance Investments | Maximum | |
Compliance with Regulatory Capital Requirements under Banking Regulations [Line Items] | |
Ratio of indebtedness to net capital | 15 |
vFinance Investments | SEC Requirement | |
Compliance with Regulatory Capital Requirements under Banking Regulations [Line Items] | |
Minimum net capital required | $ 1,000,000 |
STOCKHOLDERS' EQUITY - Stock Op
STOCKHOLDERS' EQUITY - Stock Option Activity (Details) - USD ($) $ / shares in Units, $ in Thousands | 9 Months Ended | 12 Months Ended |
Jun. 30, 2017 | Sep. 30, 2016 | |
Options | ||
Beginning balance (in shares) | 1,221,500 | |
Forfeited (in shares) | (15,500) | |
Ending balance (in shares) | 1,206,000 | 1,221,500 |
Vested and exercisable balance (in shares) | 1,206,000 | |
Weighted Average Exercise Price Per Share | ||
Beginning balance (in dollars per share) | $ 6.51 | |
Forfeited (in dollars per share) | 4.42 | |
Ending balance (in dollars per share) | 6.54 | $ 6.51 |
Vested and exercisable balance (in dollars per share) | 6.54 | |
Weighted Average Grant- Date Fair Value Per Share | ||
Outstanding balance (in dollars per share) | 1.21 | $ 1.22 |
Forfeited (in dollars per share) | 1.99 | |
Vested and exercisable balance (in dollars per share) | $ 1.21 | |
Weighted Average Remaining Contractual term (years) | ||
Balance outstanding | 2 years 6 months 15 days | 3 years 3 months 22 days |
Forfeited | ||
Vested and exercisable balance | 2 years 6 months 15 days | |
Aggregate Intrinsic Value | ||
Balance outstanding | $ 0 | $ 0 |
Forfeited | 0 | |
Vested and exercisable balance | $ 0 |
STOCKHOLDERS' EQUITY - Narrativ
STOCKHOLDERS' EQUITY - Narrative (Details) | Jan. 26, 2017shares | Jul. 31, 2017shares | Jan. 31, 2017USD ($)shares | Jun. 30, 2017USD ($)shares | Jun. 30, 2016USD ($) | Jun. 30, 2017USD ($)shares | Jun. 30, 2016USD ($) | Jan. 25, 2017shares | Sep. 30, 2016shares |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Common stock, shares authorized (in shares) | 75,000,000 | 75,000,000 | 75,000,000 | 150,000,000 | 150,000,000 | ||||
Restricted stock to common shares conversion ratio | 1 | ||||||||
Shares vesting in four equal increments | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Percentage of shares vesting each year of vesting period (as a percent) | 25.00% | ||||||||
Vesting period | 4 years | ||||||||
Shares vesting upon reaching market capitalization of $75 million | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Minimum market capitalization required for vesting | $ | $ 75,000,000 | ||||||||
Consecutive days minimum market capitalization is required for vesting | 30 days | ||||||||
Shares vesting upon reaching market capitalization of $100 million | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Nonvested shares expected to vest in future periods (in shares) | 52,083 | ||||||||
Minimum market capitalization required for vesting | $ | $ 100,000,000 | ||||||||
Consecutive days minimum market capitalization is required for vesting | 30 days | ||||||||
Shares vesting upon reaching market capitalization of $150 million | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Minimum market capitalization required for vesting | $ | $ 150,000,000 | ||||||||
Consecutive days minimum market capitalization is required for vesting | 30 days | ||||||||
Shares vesting upon EBITDA reaching $10 million or greater | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Minimum EBITDA required for vesting | $ | $ 10,000,000 | ||||||||
Shares vesting upon EBITDA reaching $15 million or greater | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Minimum EBITDA required for vesting | $ | 15,000,000 | ||||||||
Shares vesting upon EBITDA reaching $20 million or greater | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Minimum EBITDA required for vesting | $ | $ 25,000,000 | ||||||||
Options | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Compensation expense | $ | $ 26,000 | $ 125,000 | |||||||
Restricted Stock Units (RSUs) | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Compensation expense | $ | $ 129,000 | $ 312,000 | |||||||
Shares granted (in shares) | 625,000 | ||||||||
Unrecognized share based compensation | $ | $ 1,150,000 | $ 1,150,000 | |||||||
Restricted Stock Units (RSUs) | Shares vesting in four equal increments | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Nonvested shares expected to vest in future periods (in shares) | 312,500 | ||||||||
Restricted Stock Units (RSUs) | Shares vesting upon reaching market capitalization of $75 million | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Nonvested shares expected to vest in future periods (in shares) | 52,083 | ||||||||
Restricted Stock Units (RSUs) | Shares vesting upon reaching market capitalization of $150 million | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Nonvested shares expected to vest in future periods (in shares) | 52,084 | ||||||||
Restricted Stock Units (RSUs) | Shares vesting upon EBITDA reaching $10 million or greater | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Nonvested shares expected to vest in future periods (in shares) | 52,083 | ||||||||
Restricted Stock Units (RSUs) | Shares vesting upon EBITDA reaching $15 million or greater | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Nonvested shares expected to vest in future periods (in shares) | 52,083 | ||||||||
Restricted Stock Units (RSUs) | Shares vesting upon EBITDA reaching $20 million or greater | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Nonvested shares expected to vest in future periods (in shares) | 52,084 | ||||||||
2013 Omnibus Incentive Plan | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Increase in number of shares authorized for incentive plan | 650,000 | ||||||||
Subsequent Event | Restricted Stock Units (RSUs) | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Shares granted (in shares) | 625,000 | ||||||||
Vesting period | 4 years | ||||||||
Subsequent Event | Restricted Stock Units (RSUs) | Shares vesting in four equal increments | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Nonvested shares expected to vest in future periods (in shares) | 312,500 | ||||||||
Subsequent Event | Restricted Stock Units (RSUs) | Shares vesting upon reaching market capitalization of $75 million | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Nonvested shares expected to vest in future periods (in shares) | 156,250 | ||||||||
Subsequent Event | Restricted Stock Units (RSUs) | Shares vesting upon reaching market capitalization of $100 million | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Nonvested shares expected to vest in future periods (in shares) | 156,250 |
STOCKHOLDERS' EQUITY - Warrant
STOCKHOLDERS' EQUITY - Warrant Activity (Details) - $ / shares | 9 Months Ended | 12 Months Ended |
Jun. 30, 2017 | Sep. 30, 2016 | |
Weighted Average Remaining Contractual Term | ||
Issued | 4 years 6 months 22 days | |
Warrants | ||
Warrants | ||
Beginning balance (in shares) | 23,029 | |
Issued (in shares) | 12,437,916 | |
Forfeited or expired (in shares) | (1,471) | |
Ending balance (in shares) | 12,459,474 | 23,029 |
Weighted Average Exercise Price Per Share | ||
Balance (in dollars per share) | $ 3.25 | $ 5 |
Issued (in dollars per share) | 3.25 | |
Forfeited or expired (in dollars per share) | $ 5 | |
Weighted Average Remaining Contractual Term | ||
Balance outstanding | 4 years 6 months 18 days | 9 months |
SHARE REPURCHASE (Details)
SHARE REPURCHASE (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2017 | Jun. 30, 2016 | Aug. 31, 2015 | |
Stockholders' Equity Note [Abstract] | ||||
Authorized amount of repurchase plan, maximum | $ 2,000,000 | |||
Number of shares repurchased (in shares) | 33,933 | |||
Value of shares repurchased | $ 0 | $ 0 | $ 86,000 |
SEGMENT INFORMATION - Narrative
SEGMENT INFORMATION - Narrative (Details) | 9 Months Ended |
Jun. 30, 2017segment | |
Segment Reporting [Abstract] | |
Number of reportable segments | 2 |
SEGMENT INFORMATION - Segment I
SEGMENT INFORMATION - Segment Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | Sep. 30, 2016 | |
Segment Reporting Information [Line Items] | |||||
Revenues | $ 48,047 | $ 46,342 | $ 144,500 | $ 127,997 | |
Pre-tax income (loss) | (62) | (285) | 11,286 | (313) | |
Assets | 64,620 | 62,273 | 64,620 | 62,273 | $ 60,546 |
Depreciation and amortization | 288 | 302 | 871 | 898 | |
Interest | 5 | 13 | 13 | 16 | |
Capital expenditures | 952 | 203 | 1,306 | 470 | |
Corporate | |||||
Segment Reporting Information [Line Items] | |||||
Revenues | 0 | 0 | 0 | 0 | |
Pre-tax income (loss) | (1,478) | (2,224) | 2,909 | (3,885) | |
Assets | 14,282 | 18,469 | 14,282 | 18,469 | |
Depreciation and amortization | 89 | 73 | 266 | 197 | |
Interest | 0 | 13 | 0 | 15 | |
Capital expenditures | 915 | 155 | 1,178 | 389 | |
Brokerage and Advisory Services | Operating Segments | |||||
Segment Reporting Information [Line Items] | |||||
Revenues | 45,520 | 43,956 | 137,973 | 120,775 | |
Pre-tax income (loss) | 820 | 1,741 | 7,394 | 3,173 | |
Assets | 46,802 | 40,798 | 46,802 | 40,798 | |
Depreciation and amortization | 155 | 185 | 468 | 569 | |
Interest | 5 | 0 | 13 | 1 | |
Capital expenditures | 30 | 48 | 57 | 53 | |
Tax and Accounting Services | Operating Segments | |||||
Segment Reporting Information [Line Items] | |||||
Revenues | 2,527 | 2,386 | 6,527 | 7,222 | |
Pre-tax income (loss) | 596 | 198 | 983 | 399 | |
Assets | 3,536 | 3,006 | 3,536 | 3,006 | |
Depreciation and amortization | 44 | 44 | 137 | 132 | |
Interest | 0 | 0 | 0 | 0 | |
Capital expenditures | $ 7 | $ 0 | $ 71 | $ 28 |
ACQUISITION OF CONTROLLING IN64
ACQUISITION OF CONTROLLING INTEREST IN THE COMPANY - Narrative (Details) - FBIO Acquisitions Inc. - $ / shares | Sep. 12, 2016 | Jan. 31, 2017 | Jun. 30, 2017 |
Common Stock | |||
Business Acquisition [Line Items] | |||
Warrant, term of contract | 5 years | ||
Exercise price of warrants (in dollars per share) | $ 3.25 | ||
National Holdings Corp | |||
Business Acquisition [Line Items] | |||
Percentage of stock owned by aquiree required to become a privately held company, minimum (as a percent) | 80.00% | ||
National Holdings Corp | Common Stock | |||
Business Acquisition [Line Items] | |||
Share price for acquisition (in dollars per share) | $ 3.25 | ||
Number of shares tendered (in shares) | 7,037,482 | ||
Percentage of voting interests acquired (as a percent) | 56.60% | ||
Warrants | Common Stock | |||
Business Acquisition [Line Items] | |||
Warrants issued (in shares) | 12,437,916 |
ACQUISITION OF CONTROLLING IN65
ACQUISITION OF CONTROLLING INTEREST IN THE COMPANY - Valuation Assumptions (Details) | 12 Months Ended |
Sep. 30, 2016 | |
Business Combinations [Abstract] | |
Dividend yield | 0.00% |
Expected volatility | 38.20% |
Risk-free interest rate | 1.14% |
Life (in years) | 5 years |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended |
Jun. 30, 2017 | Jun. 30, 2017 | |
Related Party Transactions [Abstract] | ||
Revenue from placement agent fees | $ 3,679 | $ 12,260 |
VARIABLE INTEREST ENTITIES - Na
VARIABLE INTEREST ENTITIES - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Variable Interest Entities | ||||
Variable Interest Entity [Line Items] | ||||
Investment banking and advisory fee revenue | $ 6,071 | $ 6,283 | $ 14,033 | $ 13,335 |