Document_and_Entity_Informatio
Document and Entity Information (USD $) | 12 Months Ended | ||
Sep. 30, 2013 | Dec. 16, 2013 | Mar. 31, 2013 | |
Document Information [Line Items] | ' | ' | ' |
Document Type | '10-K | ' | ' |
Amendment Flag | 'false | ' | ' |
Document Period End Date | 30-Sep-13 | ' | ' |
Document Fiscal Year Focus | '2013 | ' | ' |
Document Fiscal Period Focus | 'FY | ' | ' |
Trading Symbol | 'SOFO | ' | ' |
Entity Registrant Name | 'SONIC FOUNDRY INC | ' | ' |
Entity Central Index Key | '0001029744 | ' | ' |
Current Fiscal Year End Date | '--09-30 | ' | ' |
Entity Well-known Seasoned Issuer | 'No | ' | ' |
Entity Current Reporting Status | 'Yes | ' | ' |
Entity Voluntary Filers | 'No | ' | ' |
Entity Filer Category | 'Smaller Reporting Company | ' | ' |
Entity Common Stock, Shares Outstanding | ' | 4,027,784 | ' |
Entity Public Float | ' | ' | $22,406,000 |
Consolidated_Balance_Sheets
Consolidated Balance Sheets (USD $) | Sep. 30, 2013 | Sep. 30, 2012 |
In Thousands, unless otherwise specified | ||
Current assets: | ' | ' |
Cash and cash equivalents | $3,482 | $4,478 |
Accounts receivable, net of allowances of $90 and $85 | 6,885 | 5,578 |
Inventories | 1,447 | 1,053 |
Prepaid expenses and other current assets | 805 | 757 |
Total current assets | 12,619 | 11,866 |
Property and equipment: | ' | ' |
Leasehold improvements | 852 | 852 |
Computer equipment | 5,296 | 3,851 |
Furniture and fixtures | 581 | 865 |
Total property and equipment | 6,729 | 5,568 |
Less accumulated depreciation and amortization | 3,449 | 2,624 |
Net property and equipment | 3,280 | 2,944 |
Other assets: | ' | ' |
Goodwill | 7,576 | 7,576 |
Investment in Mediasite KK | 385 | 420 |
Software development costs, net of amortization of $75 | 458 | ' |
Other intangibles, net of amortization of $135 and $180 | 15 | 15 |
Total assets | 24,333 | 22,821 |
Current liabilities: | ' | ' |
Revolving line of credit | ' | ' |
Accounts payable | 1,513 | 1,604 |
Accrued liabilities | 1,204 | 850 |
Unearned revenue | 6,470 | 5,284 |
Current portion of capital lease obligations | 223 | 129 |
Current portion of notes payable | 634 | 667 |
Total current liabilities | 10,044 | 8,534 |
Long-term portion of unearned revenue | 648 | 349 |
Long-term portion of capital lease obligations | 149 | 131 |
Long-term portion of notes payable | 133 | 766 |
Other liabilities | 445 | 532 |
Deferred tax liability | 2,210 | 1,970 |
Total liabilities | 13,629 | 12,282 |
Commitments and contingencies | ' | ' |
Stockholders' equity: | ' | ' |
Preferred stock | ' | ' |
Common stock, $.01 par value, authorized 10,000,000 shares; 3,999,634 and 3,909,040 shares issued and 3,986,918 and 3,896,324 shares outstanding | 40 | 39 |
Additional paid-in capital | 190,653 | 189,459 |
Accumulated deficit | -179,556 | -178,764 |
Accumulated other comprehensive loss | -238 | ' |
Receivable for common stock issued | -26 | -26 |
Treasury stock, at cost, 12,716 shares | -169 | -169 |
Total stockholders' equity | 10,704 | 10,539 |
Total liabilities and stockholders' equity | 24,333 | 22,821 |
5% preferred stock, Series B, voting, cumulative, convertible [Member] | ' | ' |
Stockholders' equity: | ' | ' |
Preferred stock | ' | ' |
Consolidated_Balance_Sheets_Pa
Consolidated Balance Sheets (Parenthetical) (USD $) | Sep. 30, 2013 | Sep. 30, 2012 |
In Thousands, except Share data, unless otherwise specified | ||
Accounts receivable, allowances | $90 | $85 |
Software development costs, amortization | 75 | ' |
Other intangibles, amortization | $135 | $180 |
Preferred stock, par value | $0.01 | $0.01 |
Preferred stock, shares authorized | 500,000 | 500,000 |
Preferred stock, issued | ' | ' |
Preferred stock, dividend rate | 5.00% | 5.00% |
Common stock, par value | $0.01 | $0.01 |
Common stock, shares authorized | 10,000,000 | 10,000,000 |
Common stock, shares issued | 3,999,634 | 3,909,040 |
Common stock, shares outstanding | 3,986,918 | 3,896,324 |
Treasury stock, shares | 12,716 | 12,716 |
5% preferred stock, Series B, voting, cumulative, convertible [Member] | ' | ' |
Preferred stock, par value | $0.01 | $0.01 |
Preferred stock, shares authorized | 1,000,000 | 1,000,000 |
Preferred stock, issued | ' | ' |
Consolidated_Statements_of_Ope
Consolidated Statements of Operations (USD $) | 12 Months Ended | |
In Thousands, except Share data, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 |
Revenue: | ' | ' |
Product | $13,588 | $12,385 |
Services | 13,933 | 13,409 |
Other | 235 | 296 |
Total revenue | 27,756 | 26,090 |
Cost of revenue: | ' | ' |
Product | 6,215 | 5,883 |
Services | 1,481 | 1,363 |
Total cost of revenue | 7,696 | 7,246 |
Gross margin | 20,060 | 18,844 |
Operating expenses: | ' | ' |
Selling and marketing | 13,079 | 11,841 |
General and administrative | 3,343 | 2,815 |
Product development | 4,276 | 4,079 |
Total operating expenses | 20,698 | 18,735 |
Income (loss) from operations | -638 | 109 |
Equity in earnings from investment in Mediasite KK | 209 | 420 |
Interest expense | -92 | -152 |
Other income (expense), net | -31 | 20 |
Total other income, net | 86 | 288 |
Income (loss) before income taxes | -552 | 397 |
Provision for income taxes | -240 | -240 |
Net income (loss) | ($792) | $157 |
Income (loss) per common share: | ' | ' |
Basic net income (loss) per common share | ($0.20) | $0.04 |
Diluted net income (loss) per common share | ($0.20) | $0.04 |
Weighted average common shares - Basic | 3,932,692 | 3,857,161 |
- Diluted | 3,932,692 | 3,907,888 |
Consolidated_Statements_of_Com
Consolidated Statements of Comprehensive Loss (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 |
Net income (loss) | ($792) | $157 |
Other comprehensive income (loss), net of taxes: | ' | ' |
Foreign currency translation adjustment | -238 | ' |
Total other comprehensive income (loss) | -238 | ' |
Comprehensive loss | ($1,030) | $157 |
Consolidated_Statements_of_Sto
Consolidated Statements of Stockholders' Equity (USD $) | Total | Common Stock [Member] | Additional paid-in capital [Member] | Accumulated Deficit [Member] | Accumulated Other Comprehensive Income (Loss) [Member] | Receivable for common stock issued [Member] | Treasury stock [Member] |
In Thousands | |||||||
Beginning balance at Sep. 30, 2011 | $9,261 | $38 | $188,339 | ($178,921) | ' | ($26) | ($169) |
Stock compensation and other | 742 | ' | 742 | ' | ' | ' | ' |
Issuance of common stock | 134 | ' | 134 | ' | ' | ' | ' |
Exercise of common stock options | 245 | 1 | 244 | ' | ' | ' | ' |
Net income | 157 | ' | ' | 157 | ' | ' | ' |
Ending balance at Sep. 30, 2012 | 10,539 | 39 | 189,459 | -178,764 | ' | -26 | -169 |
Stock compensation and other | 656 | ' | 656 | ' | ' | ' | ' |
Issuance of common stock | 75 | ' | 75 | ' | ' | ' | ' |
Exercise of common stock options | 448 | 1 | 447 | ' | ' | ' | ' |
Foreign currency translation adjustment | -238 | ' | ' | ' | -238 | ' | ' |
Equity method investment ownership changes | 16 | ' | 16 | ' | ' | ' | ' |
Net income | -792 | ' | ' | -792 | ' | ' | ' |
Ending balance at Sep. 30, 2013 | $10,704 | $40 | $190,653 | ($179,556) | ($238) | ($26) | ($169) |
Consolidated_Statements_of_Cas
Consolidated Statements of Cash Flows (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 |
Operating activities | ' | ' |
Net income (loss) | ($792) | $157 |
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | ' | ' |
Equity in earnings from investment in Mediasite KK | -209 | -420 |
Amortization of other intangibles | 20 | 75 |
Amortization of software development costs | 75 | ' |
Depreciation and amortization of property and equipment | 1,111 | 855 |
Provision for doubtful accounts | 5 | -5 |
Deferred taxes | 240 | 240 |
Stock-based compensation expense related to stock options | 656 | 742 |
Changes in operating assets and liabilities: | ' | ' |
Accounts receivable | -1,312 | 226 |
Inventories | -394 | -517 |
Prepaid expenses and other assets | -48 | -17 |
Accounts payable, accrued liabilities and other long-term liabilities | 176 | -601 |
Unearned revenue | 1,485 | -385 |
Net cash provided by operating activities | 1,013 | 350 |
Investing activities | ' | ' |
Capitalization of software development costs | -533 | 0 |
Purchases of property and equipment | -1,162 | -1,456 |
Net cash used in investing activities | -1,695 | -1,456 |
Financing activities | ' | ' |
Proceeds from notes payable | ' | 1,200 |
Payments on notes payable | -666 | -1,390 |
Payments of loan fees | -20 | -20 |
Proceeds from issuance of common stock | 75 | 134 |
Proceeds from exercise of common stock warrants and options | 448 | 245 |
Dividends from investment in Mediasite KK | 22 | ' |
Payments on capital leases | -173 | -100 |
Net cash (used in) provided by financing activities | -314 | 69 |
Net decrease in cash and cash equivalents | -996 | -1,037 |
Cash and cash equivalents at beginning of period | 4,478 | 5,515 |
Cash and cash equivalents at end of period | 3,482 | 4,478 |
Supplemental cash flow information: | ' | ' |
Interest paid | 92 | 120 |
Non-cash transactions: | ' | ' |
Property and equipment financed by accounts payable, accrued liabilities or capital lease | 345 | 752 |
Comprehensive loss attributable to equity method investment in MSKK | $238 | ' |
Basis_of_Presentation_and_Sign
Basis of Presentation and Significant Accounting Policies | 12 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Basis of Presentation and Significant Accounting Policies | ' | ||||||||
1. Basis of Presentation and Significant Accounting Policies | |||||||||
Business | |||||||||
Sonic Foundry, Inc. (the Company) is in the business of providing enterprise solutions and services for the web communications market. | |||||||||
Principles of Consolidation | |||||||||
The accompanying consolidated financial statements include the accounts of the Company and its wholly-owned subsidiary, Sonic Foundry Media Systems, Inc. All significant intercompany transactions and balances have been eliminated. | |||||||||
Under the equity method of accounting, the Company’s investment in unconsolidated affiliates are initially recorded as an investment in the stock of an investee at cost and are adjusted on a quarterly basis for the carrying amount of the investment to recognize the investor’s share of changes in the net assets of the investee after the date of the initial investment. | |||||||||
Use of Estimates | |||||||||
In preparing financial statements in conformity with accounting principles generally accepted in the United States of America (US GAAP), management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expense during the period. Actual results could differ from those estimates. | |||||||||
Revenue Recognition | |||||||||
General | |||||||||
Revenue is recognized when persuasive evidence of an arrangement exists, delivery occurs or services are rendered, the sales price is fixed or determinable and collectability is reasonably assured. Revenue is deferred when undelivered products or services are essential to the functionality of delivered products, customer acceptance is uncertain, significant obligations remain, or the fair value of undelivered elements is unknown. The Company does not offer customers the right to return product, other than for exchange or repair pursuant to a warranty or stock rotation. The Company’s policy is to reduce revenue if it incurs an obligation for price rebates or other such programs during the period the obligation is reasonably estimated to occur. The following policies apply to the Company’s major categories of revenue transactions. | |||||||||
Products | |||||||||
Products are considered delivered, and revenue is recognized, when title and risk of loss have been transferred to the customer. Under the terms and conditions of the sale, this occurs at the time of shipment to the customer. Product revenue currently represents sales of our Mediasite recorder and Mediasite related products such as our server software and other software licenses. If a license is time-based, the revenue is recognized over the term of the license agreement. | |||||||||
Services | |||||||||
The Company sells support and content hosting contracts to our customers, typically one year in length, and records the related revenue ratably over the contractual period. Our support contracts cover phone and electronic technical support availability over and above the level provided by our distributors, software upgrades on a when and if available basis, advance hardware replacement and an extension of the standard hardware warranty from 90 days to one year. The manufacturers the Company contracts with to build the units provide a limited one-year warranty on the hardware. The Company also sells installation, training, event webcasting, and customer content hosting services. Revenue for those services is recognized when performed in the case of installation, training and event webcasting services. Service amounts invoiced to customers in excess of revenue recognized are recorded as deferred revenue until the revenue recognition criteria are met. | |||||||||
Revenue Arrangements that Include Multiple Elements | |||||||||
Sales of software, with or without installation, training, and post customer support fall within the scope of the software revenue recognition rules. Under the software revenue recognition rules, the fee from a multiple-deliverable arrangement is allocated to each of the undelivered elements based upon vendor-specific objective evidence (VSOE), which is limited to the price charged when the same deliverable is sold separately, with the residual value from the arrangement allocated to the delivered element. The portion of the fee that is allocated to each deliverable is then recognized as revenue when the criteria for revenue recognition are met with respect to that deliverable. If VSOE does not exist for all of the undelivered elements, then all revenue from the arrangement is typically deferred until all elements have been delivered to the customer. All revenue arrangements, with the exception of hosting contracts, entered into prior to October 1, 2010 and the sale of all software-only products and associated services have been accounted for under this guidance. | |||||||||
In the case of the Company’s hardware products with embedded software, the Company has determined that the hardware and software components function together to deliver the product’s essential functionality, and therefore, the revenue from the sale of these products is accounted for under the revenue recognition rules for tangible products whereby the fee from a multiple-deliverable arrangement is allocated to each of the deliverables based upon their relative selling prices as determined by a selling-price hierarchy. A deliverable in an arrangement qualifies as a separate unit of accounting if the delivered item has value to the customer on a stand-alone basis. A delivered item that does not qualify as a separate unit of accounting is combined with the other undelivered items in the arrangement and revenue is recognized for those combined deliverables as a single unit of accounting. The selling price used for each deliverable is based upon VSOE if available, third-party evidence (TPE) if VSOE is not available, and best estimate of selling price (ESP) if neither VSOE nor TPE are available. TPE is the price of the Company’s or any competitor’s largely interchangeable products or services in stand-alone sales to similarly situated customers. ESP is the price at which the Company would sell the deliverable if it were sold regularly on a stand-alone basis, considering market conditions and entity-specific factors. All revenue arrangements negotiated after September 30, 2010, excluding the sale of all software-only products and associated services, have been accounted for under this guidance. | |||||||||
The selling prices used in the relative selling price allocation method are as follows: (1) the Company’s products and services are based upon VSOE and (2) hardware products with embedded software, for which VSOE does not exist, are based upon ESP. The Company does not believe TPE exists for any of these products and services because they are differentiated from competing products and services in terms of functionality and performance and there are no competing products or services that are largely interchangeable. Management establishes ESP for hardware products with embedded software using a cost plus margin approach with consideration for market conditions, such as the impact of competition and geographic considerations, and entity-specific factors, such as the cost of the product and the Company’s profit objectives. Management believes that ESP is reflective of reasonable pricing of that deliverable as if priced on a stand-alone basis. When a sales transaction includes deliverables that are divided between ASC Topic 605 and ASC Subtopic 985-605, the Company allocates the selling price using the relative selling price method whereas value is allocated using an ESP for software developed using a percent of list price approach. The other deliverables are valued using ESP or VSOE as previously discussed. | |||||||||
While the pricing model, currently in use, captures all critical variables, unforeseen changes due to external market forces may result in a revision of the inputs. These modifications may result in the consideration allocation differing from the one presently in use. Absent a significant change in the pricing inputs or the way in which the industry structures its transactions, future changes in the pricing model are not expected to materially affect our allocation of arrangement consideration. | |||||||||
Management has established VSOE for hosting services. Billings for hosting are spread ratably over the term of the hosting agreement, with the typical hosting agreement having a term of 12 months, with renewal on an annual basis. The Company sells most hosting contracts without the inclusion of products. When the hosting arrangement is sold in conjunction with product, the product revenue is recognized immediately while the remaining hosting revenue is spread ratably over the term of the hosting agreement. The selling price is allocated between these elements using the relative selling price method. The Company uses ESP for development of the selling price for hardware products with embedded software. | |||||||||
The Company also offers hosting services bundled with events services. The Company uses VSOE to establish relative selling prices for its events services. The Company recognizes events revenue when the event takes place and recognizes the hosting revenue over the term of the hosting agreement. The total amount of the arrangement is allocated to each element based on the relative selling price method. | |||||||||
Reserves | |||||||||
The Company reserves for stock rotations, price adjustments, rebates, and sales incentives to reduce revenue and accounts receivable for these and other credits granted to customers. Such reserves are recorded at the time of sale and are calculated based on historical information (such as rates of product stock rotations) and the specific terms of sales programs, taking into account any other known information about likely customer behavior. If actual customer behavior differs from our expectations, additional reserves may be required. Also, if the Company determines that it can no longer accurately estimate amounts for stock rotations and sales incentives, the Company would not be able to recognize revenue until resellers sell the inventory to the final end user. | |||||||||
Shipping and Handling | |||||||||
The Company’s shipping and handling costs billed to customers are included in other revenue. Costs related to shipping and handling are included in cost of revenue and are recorded at the time of shipment to the customer. | |||||||||
Concentration of Credit Risk and Other Risks and Uncertainties | |||||||||
The Company’s cash and cash equivalents are deposited with two major financial institutions. At times, deposits in these institutions exceed the amount of insurance provided on such deposits. The Company has not experienced any losses on such amounts and believes that it is not exposed to any significant credit risk on these balances. | |||||||||
We assess the realization of our receivables by performing ongoing credit evaluations of our customers’ financial condition. Through these evaluations, we may become aware of a situation where a customer may not be able to meet its financial obligations due to deterioration of its financial viability, credit ratings or bankruptcy. Our reserve requirements are based on the best facts available to us and are reevaluated and adjusted as additional information is received. Our reserves are also based on amounts determined by using percentages applied to certain aged receivable categories. These percentages are determined by a variety of factors including, but not limited to, current economic trends, historical payment and bad debt write-off experience. Allowance for doubtful accounts for accounts receivable was $90,000 at September 30, 2013 and $85,000 at September 30, 2012. | |||||||||
We had billings for Mediasite product and support services as a percentage of total billings to one distributor of approximately 20% in 2013 and 18% in 2012 and to a second distributor of approximately 22% in 2013 and 25% in 2012. At September 30, 2013 and 2012, these two distributors represented 56% of total accounts receivable. | |||||||||
Currently all of our product inventory purchases are from one third-party contract manufacturer. Although we believe there are multiple sources of supply from other contract manufacturers as well as multiple suppliers of component parts required by the contract manufacturers, a disruption of supply of component parts or completed products, even if short term, would have a material negative impact on our revenues. At September 30, 2013 and 2012, this supplier represented 34% and 60%, respectively, of total accounts payable. We also license technology from third parties that is embedded in our software. We believe there are alternative sources of similar licensed technology from other third parties that we could also embed in our software, although it could create potential programming related issues that might require engineering resources. | |||||||||
Cash and Cash Equivalents | |||||||||
The Company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents. | |||||||||
Trade Accounts Receivable | |||||||||
The majority of the Company’s accounts receivable are due from entities in, or distributors or value added resellers to, the education, corporate and government sectors. Credit is extended based on evaluation of a customer’s financial condition and, generally, collateral is not required. Accounts receivable are typically due within 30 days and are stated at amounts due from customers net of an allowance for doubtful accounts. Accounts outstanding longer than the contractual payment terms are considered to be past due. The Company determines its allowance by considering a number of factors, including the length of time trade accounts receivable are past due, the Company’s previous loss history, the customer’s current ability to pay its obligation to the Company, and the condition of the general economy and the industry as a whole. The Company writes-off accounts receivable when they become uncollectible, and payments subsequently received on such receivables are credited to the allowance for doubtful accounts. Interest is not accrued on past due receivables. | |||||||||
Inventory Valuation | |||||||||
Inventory consists of raw materials and supplies used in the assembly of Mediasite recorders and finished units. Inventory of completed units and spare parts are carried at the lower of cost or market, with cost determined on a first-in, first-out basis. | |||||||||
Inventory consists of the following (in thousands): | |||||||||
September 30, | |||||||||
2013 | 2012 | ||||||||
Raw materials and supplies | $ | 516 | $ | 216 | |||||
Finished goods | 931 | 837 | |||||||
$ | 1,447 | $ | 1,053 | ||||||
Capitalized Software Development Costs | |||||||||
Software development costs incurred in conjunction with product development are charged to research and development expense until technological feasibility is established. Thereafter, until the product is released for sale, software development costs are capitalized and reported at the net realizable value of the related product. Typically the period between achieving technological feasibility of the Company’s products and the general availability of the products has been short. Consequently, software development costs qualifying for capitalization are typically immaterial and are generally expensed to research and development costs. During 2013, the Company’s My Mediasite product release required software capitalization since there was a longer period between technological feasibility and the general availability of the product. Upon product release, the amortization of software development costs is determined annually as the greater of the amount computed using the ratio of current gross revenues for the products to their total of current and anticipated future gross revenues or the straight-line method over the estimated economic life of the products, expected to be three years. Amortization expense of software development costs of $75 thousand at September 30, 2013 is included in Cost of Revenue – Product. The amount of capitalized external and internal development costs is $533 thousand for the year ended September 30, 2013. There were no development costs capitalized in period ended September 30, 2012. | |||||||||
Equity in earnings from investment in Mediasite KK | |||||||||
The Company’s investment in Mediasite KK is accounted for under the equity method of accounting using a one quarter timing lag. The Company’s current ownership percentage is approximately 26% of their common stock as compared to 23% as of the end of fiscal 2012. The Company recorded equity in earnings of $209 thousand and $420 thousand for the years ended September 30, 2013 and September 30, 2012, respectively. The recorded value of this investment, net of foreign currency translation adjustment, is $385 thousand as of September 30, 2013 and $420 thousand as of September 30, 2012. The Company also received a $22 thousand dividend from Mediasite KK during the year ended September 30, 2013. | |||||||||
Property and Equipment | |||||||||
Property and equipment are recorded at cost and are depreciated using the straight-line method for financial reporting purposes. The estimated useful lives used to calculate depreciation are as follows: | |||||||||
Years | |||||||||
Leasehold improvements | 5 to 10 years | ||||||||
Computer equipment | 3 to 5 years | ||||||||
Furniture and fixtures | 5 to 7 years | ||||||||
Impairment of Long-Lived Assets | |||||||||
We assess the impairment of goodwill on an annual basis or whenever events or changes in circumstances indicate that the fair value of these assets is less than the carrying value. In fiscal 2012 with the adoption of ASU 2011-08, “Testing Goodwill for Impairment”, we first assessed qualitative factors related to goodwill to determine whether it is more likely than not that the fair value of the reporting unit is less than its carrying amount as a basis for determining whether it is necessary to perform the two-step goodwill test. The more-likely-than-not threshold is defined as having a likelihood of more than 50 percent. Using the qualitative assessment, we determined that the fair value of goodwill is more likely than not greater than its carrying amount thus step two was not deemed necessary to perform. In fiscal 2013, we performed the two-step goodwill test and determined that the fair value of goodwill is more than the carrying value. The Company has recognized no impairment charges as of September 30, 2013 and September 30, 2012. | |||||||||
If we had determined that the fair value of goodwill is less than its carrying value, based upon the annual test or the existence of one or more indicators of impairment, we would then measure impairment based on a comparison of the implied fair value of goodwill with the carrying amount of goodwill. To the extent the carrying amount of goodwill is greater than the implied fair value of goodwill, we would record an impairment charge for the difference. | |||||||||
Long-lived assets and intangible assets other than goodwill are evaluated for impairment whenever events or changes in circumstances indicate that the carrying value of an asset may not be recoverable based on expected undiscounted cash flows attributable to that asset. For the years ended September 30, 2013 and 2012, no events or changes in circumstances occurred that required this analysis. | |||||||||
Comprehensive Income (Loss) | |||||||||
Comprehensive income (loss) includes disclosure of financial information that historically has not been recognized in the calculation of net income. Our comprehensive income (loss) encompasses net income (loss) and foreign currency translation. Assets and liabilities of international operations that have a functional currency that is not in U.S. dollars are translated into U.S. dollars at year-end exchange rates, and revenue and expense items are translated using weighted average exchange rates. Any adjustments arising on translation are included in shareholders’ equity as an element of accumulated other comprehensive income (loss). | |||||||||
Advertising Expense | |||||||||
Advertising costs included in selling and marketing, are expensed when the advertising first takes place. Advertising expense was $238 and $261 thousand for years ended September 30, 2013 and 2012, respectively. | |||||||||
Research and Development Costs | |||||||||
Research and development costs are expensed in the period incurred, unless they meet the criteria for capitalized software development costs. | |||||||||
Income Taxes | |||||||||
Deferred income taxes are provided for temporary differences between financial reporting and income tax basis of assets and liabilities, and are measured using currently enacted tax rates and laws. Deferred income taxes also arise from the future benefits of net operating loss carryforwards. A valuation allowance equal to 100% of the net deferred tax assets has been recognized due to uncertainty regarding the future realization. | |||||||||
The Company also accounts for the uncertainty in income taxes related to the recognition and measurement of a tax position and measurement of a tax position taken or expected to be taken in an income tax return. The Company follows the applicable accounting guidance on derecognition, classification, interest and penalties, accounting in interim periods and disclosure related to the uncertainty in income tax positions. | |||||||||
Fair Value of Financial Instruments | |||||||||
The Company’s financial instruments consist primarily of cash and cash equivalents, accounts receivable, accounts payable and debt instruments. The book values of cash and cash equivalents, accounts receivable, debt and accounts payable are considered to be representative of their respective fair values. The carrying value of capital lease obligations, including the current portion, approximates fair market value as the fixed rate approximates the current market rate of interest available to the Company. | |||||||||
Stock-Based Compensation | |||||||||
The Company uses a lattice valuation model to account for all employee stock options granted. The lattice valuation model provides a flexible analysis to value options because of its ability to incorporate inputs that change over time, such as actual exercise behavior of option holders. The Company uses historical data to estimate the option exercise and employee departure behavior in the lattice valuation model. Expected volatility is based on historical volatility of the Company’s stock. The Company considers all employees to have similar exercise behavior and therefore has not identified separate homogenous groups for valuation. The expected term of options granted is derived from the output of the option pricing model and represents the period of time that options granted are expected to be outstanding. The risk-free rate for periods the options are expected to be outstanding is based on the U.S. Treasury yields in effect at the time of grant. Forfeitures are based on actual behavior patterns. | |||||||||
The fair value of each option grant is estimated using the assumptions in the following table: | |||||||||
Years Ending | |||||||||
September 30, | |||||||||
2013 | 2012 | ||||||||
Expected life | 4.7 – 4.8 years | 4.7 – 4.8 years | |||||||
Risk-free interest rate | 0.35%-0.61% | 0.40% | |||||||
Expected volatility | 46.8% - 49.3% | 51.4% - 64.0% | |||||||
Expected forfeiture rate | 11.8%-13.0% | 12.0%-13.1% | |||||||
Expected exercise factor | 1.36-1.37 | 1.34 – 1.36 | |||||||
Expected dividend yield | 0% | 0% | |||||||
Per Share Computation | |||||||||
Basic earnings per share has been computed using the weighted-average number of shares of common stock outstanding during the period, less shares that may be repurchased, and excludes any dilutive effects of options and warrants. In periods where the Company reports net income, diluted net income per share is computed using common equivalent shares related to outstanding options and warrants to purchase common stock. The numerator for the calculation of basic and diluted earnings per share is net income (loss). The following table sets forth the computation of basic and diluted weighted average shares used in the earnings per share calculations: | |||||||||
Years Ending | |||||||||
September 30, | |||||||||
2013 | 2012 | ||||||||
Denominator for basic earnings per share | |||||||||
- weighted average common shares | 3,932,692 | 3,857,161 | |||||||
Effect of dilutive options and warrants (treasury method) | — | 50,727 | |||||||
Denominator for diluted earnings per share | |||||||||
- adjusted weighted average common shares | 3,932,692 | 3,907,888 | |||||||
Options and warrants outstanding during each year, but not included in the computation of diluted earnings per share because they are antidilutive | 997,045 | 576,863 | |||||||
Reclassifications | |||||||||
Reclassifications have been made to the September 30, 2012 notes to the financial statements to conform to the September 30, 2013 presentation. | |||||||||
Recent Accounting Pronouncements | |||||||||
In July 2013, the FASB issued ASU 2013-11, “Income Taxes (Topic 740)—Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists.” The amendments in this ASU provide guidance for the financial statement presentation of an unrecognized tax benefit when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists. The amendments in this ASU are expected to reduce diversity in practice by providing guidance on the presentation of unrecognized tax benefits and will better reflect the manner in which an entity would settle at the reporting date any additional income taxes that would result from the disallowance of a tax position when net operating loss carryforwards, similar tax losses, or tax credit carryforwards exist. This update is effective for fiscal years, and interim periods within those years, beginning after December 15, 2013. The adoption of this guidance is not expected to have an impact on the Company’ | |||||||||
Accounting standards that have been issued but are not yet effective by the FASB or other standards-setting bodies that do not require adoption until a future date are not expected to have a material impact on the Company’s financial statements upon adoption. |
Commitments
Commitments | 12 Months Ended | ||||
Sep. 30, 2013 | |||||
Commitments | ' | ||||
2. Commitments | |||||
The Company leases certain equipment under capital lease agreements expiring through June 2016. Such leases are included in fixed assets with a cost of $660 thousand and accumulated depreciation of $184 thousand at September 30, 2013. Minimum lease payments, including principal and interest, are summarized in the table below. | |||||
Fiscal Year (in thousands) | Capital | ||||
2014 | $ | 227 | |||
2015 | 121 | ||||
2016 | 46 | ||||
Total payments | 394 | ||||
Less interest | (22 | ) | |||
Total | $ | 372 | |||
The Company leases certain facilities and equipment under operating lease agreements expiring at various times through December 31, 2018. Total rent expense on all operating leases was approximately $581 thousand and $526 thousand for the years ended September 30, 2013 and 2012, respectively. | |||||
In November 2011, the Company occupied office space related to a lease agreement entered into on June 28, 2011. The lease term is from November 2011 through December 2018. The lease includes a tenant improvement allowance of $613 thousand that was recorded as a leasehold improvement liability and is being amortized as a credit to rent expense on a straight-line basis over the lease term. At September 30, 2013, the unamortized balance is $445 thousand. | |||||
The following is a schedule by year of future minimum lease payments under operating leases: | |||||
Fiscal Year (in thousands) | Operating | ||||
2014 | $ | 621 | |||
2015 | 632 | ||||
2016 | 648 | ||||
2017 | 664 | ||||
2018 | 681 | ||||
Thereafter | 172 | ||||
Total | $ | 3,418 | |||
The Company enters into unconditional purchase commitments on a regular basis for the supply of Mediasite product. The Company has an obligation to purchase $1.1 million at September 30, 2013, which is not recorded on the Company’s Consolidated Balance Sheet. | |||||
The Company enters into license agreements that generally provide indemnification against intellectual property claims for its customers as well as indemnification agreements with certain service providers, landlords and other parties in the normal course of business. The Company has not incurred any material costs as a result of such indemnifications and has not accrued any liabilities related to such obligations in the consolidated financial statements. |
Credit_Arrangements
Credit Arrangements | 12 Months Ended | ||||
Sep. 30, 2013 | |||||
Credit Arrangements | ' | ||||
3. Credit Arrangements | |||||
On June 27, 2011, the Company and its wholly owned subsidiary, Sonic Foundry Media Systems, Inc. (the “Companies”) entered into the Second Amended and Restated Loan and Security Agreement with Silicon Valley Bank (the “Second Amended Agreement”). Under the Second Amended Agreement, the revolving line of credit has a maximum principal amount of $3,000,000. Interest accrues on the revolving line of credit at the per annum rate of one percent (1.0%) above the Prime Rate (as defined), provided that Sonic Foundry maintains an Adjusted Quick Ratio (as defined) of greater than 2.0 to 1.0, or one-and-one half percent (1.5%) above the Prime Rate, if Sonic Foundry does not maintain an Adjusted Quick Ratio of greater than 2.0 to 1.0. The Second Amended Agreement does not provide for a minimum interest rate on the revolving loan. The Second Amended Agreement also provides for an increase in the advance rate on domestic receivables from 75% to 80%, and extends the facility maturity date to October 1, 2013. Under the Second Amended Agreement, the existing term loan will continue to accrue interest at a per annum rate equal to the greater of (i) one percentage point (1.0%) above Silicon Valley Bank’s prime rate; or (ii) eight and three quarters percent (8.75%). In addition, a new term loan can be issued in multiple draws provided that the total term loan from Silicon Valley Bank shall not exceed $2,000,000 and provided further that total term debt shall not exceed $2,400,000. Under the Second Amended Agreement, any new draws on the term loan will accrue interest at a per annum rate equal to the Prime Rate plus three and three quarters percent (3.75%), or three-and-one quarter percent (3.25%) above the Prime Rate if Sonic Foundry maintains an Adjusted Quick Ratio of greater than 2.0 to 1.0. The Second Amended Agreement does not provide for a minimum interest rate on the new term loan. Each draw on the new term loan will be amortized over a 36-month period. The Second Amended Agreement also requires Sonic Foundry to continue to comply with certain financial covenants, including covenants to maintain an Adjusted Quick Ratio (as defined) of at least 1.75 to 1.00 and Debt Service Coverage Ratio of at least 1.25 to 1.00, the latter of which will be waived if certain funds are reserved against the availability under the revolving line of credit. | |||||
On May 31, 2013, the Company entered into a First Amendment to the Second Amended and Restated Loan and Security Agreement (the “First Amendment”) with Silicon Valley Bank. Under the First Amendment: (i) the Revolving Loan Maturity Date (as defined) was extended from October 1, 2013 to October 1, 2015, (ii) the interest rate on the revolving line of credit was decreased so that interest will accrue at the per annum rate of three quarters of one percent (0.75 %) above the Prime Rate (as defined), provided that Sonic Foundry maintains an Adjusted Quick Ratio (as defined) of greater than 2.0 to 1.0, or one-and-one quarter percent (1.25%) above the Prime Rate, if Sonic Foundry does not maintain an Adjusted Quick Ratio of greater than 2.0 to 1.0, (iii) the interest rate on the Unused Revolving Loan Facility Fee (as defined) was decreased to seventeen and one-half hundredths of one percent (0.175%), and (iv) the restriction on the ability of Sonic Foundry to repurchase up to $1,000,000 of its common stock was removed. | |||||
At September 30, 2013, a balance of $767 thousand was outstanding on the term loans with Silicon Valley Bank, with an effective interest rate of six-and-one half percent (6.5%), and no balance was outstanding on the revolving line of credit. At September 30, 2012, a balance of $1.4 million was outstanding on the term loans with Silicon Valley Bank and no balance was outstanding on the revolving line of credit. At September 30, 2013, there was $2.2 million available under this credit facility for advances. At September 30, 2013 the Company was in compliance with all covenants in the First Amendment to the Second Amended Agreement. | |||||
The Second Amended Agreement contains events of default that include, among others, non-payment of principal or interest, inaccuracy of any representation or warranty, violation of covenants, bankruptcy and insolvency events, material judgments, cross defaults to certain other indebtedness, and material adverse changes. The occurrence of an event of default could result in the acceleration of the Companies’ obligations under the Second Amended Agreement. | |||||
Pursuant to the Second Amended Agreement, the Companies pledged as collateral to Silicon Valley Bank substantially all non-intellectual property business assets. The Companies also entered into an Intellectual Property Security Agreement with respect to intellectual property assets. | |||||
The annual principal payments on the term loans were as follows: | |||||
Fiscal Year (in thousands) | |||||
2014 | $ | 634 | |||
2015 | 133 | ||||
Total | $ | 767 | |||
Common_Stock_Warrants
Common Stock Warrants | 12 Months Ended |
Sep. 30, 2013 | |
Common Stock Warrants | ' |
4. Common Stock Warrants | |
The Company has issued restricted common stock purchase warrants to various consultants and other third parties. Each warrant represents the right to purchase one share of common stock. The Company did not grant any warrants in fiscal 2013 or fiscal 2012. All such warrants are either valued and expensed in full at the date of grant or valued at the date of grant and deferred over the term of the relevant contract for services. There are no outstanding warrants at September 30, 2013. |
Stock_Options_and_Employee_Sto
Stock Options and Employee Stock Purchase Plan | 12 Months Ended | ||||||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||||||
Stock Options and Employee Stock Purchase Plan | ' | ||||||||||||||||||||
5. Stock Options and Employee Stock Purchase Plan | |||||||||||||||||||||
On March 5, 2009, Stockholders approved adoption of the 2009 Stock Incentive Plan (the “2009 Plan”). The 2009 Plan, beginning October 1, 2009, replaced two former employee stock option plans that terminated coincident with the effectiveness of the 2009 Plan. On March 7, 2012, Stockholders approved an amendment to increase the number of shares of common stock subject to this plan by 600,000 and to increase the number of shares for the directors’ stock option plan by 50,000 shares. The Company maintains a directors’ stock option plan under which options may be issued to purchase up to an aggregate of 100,000 shares of common stock. Each non-employee director, who is re-elected or who continues as a member of the board of directors on each annual meeting date and on each subsequent meeting of Stockholders, will be granted options to purchase 2,000 shares of common stock under the directors’ plan, or at other times or amounts at the discretion of the Board of Directors. | |||||||||||||||||||||
Each option entitles the holder to purchase one share of common stock at the specified option price. The exercise price of each option granted under the plans was set at the fair market value of the Company’s common stock at the respective grant date. Options vest at various intervals and expire at the earlier of termination of employment, discontinuance of service on the board of directors, ten years from the grant date or at such times as are set by the Company at the date of grant. | |||||||||||||||||||||
The Company has applied a graded (tranche-by-tranche) attribution method and expenses share-based compensation on an accelerated basis over the vesting period of the share award, net of estimated forfeitures. | |||||||||||||||||||||
The number of shares available for grant under these plans at September 30 is as follows: | |||||||||||||||||||||
Qualified | Director | ||||||||||||||||||||
Employee | Stock Option | ||||||||||||||||||||
Stock Option | Plans | ||||||||||||||||||||
Plans | |||||||||||||||||||||
Shares available for grant at September 30, 2011 | 151,883 | 7,000 | |||||||||||||||||||
Stockholder approval to increase shares | 600,000 | 50,000 | |||||||||||||||||||
Options granted | (180,350 | ) | (12,500 | ) | |||||||||||||||||
Options forfeited | 30,393 | — | |||||||||||||||||||
Shares available for grant at September 30, 2012 | 601,926 | 44,500 | |||||||||||||||||||
Options granted | (297,600 | ) | (12,500 | ) | |||||||||||||||||
Options forfeited | 79,803 | 4,000 | |||||||||||||||||||
Shares available for grant at September 30, 2013 | 384,129 | 36,000 | |||||||||||||||||||
The following table summarizes information with respect to outstanding stock options. | |||||||||||||||||||||
Years Ended September 30, | |||||||||||||||||||||
2013 | 2012 | ||||||||||||||||||||
Options | Weighted | Options | Weighted | ||||||||||||||||||
Average | Average | ||||||||||||||||||||
Exercise | Exercise | ||||||||||||||||||||
Price | Price | ||||||||||||||||||||
Outstanding at beginning of year | 846,280 | $ | 11.28 | 785,547 | $ | 11.52 | |||||||||||||||
Granted | 310,100 | 7.6 | 192,850 | 9.03 | |||||||||||||||||
Exercised | (75,532 | ) | 5.93 | (42,499 | ) | 5.75 | |||||||||||||||
Forfeited | (83,803 | ) | 11.22 | (89,618 | ) | 11.12 | |||||||||||||||
Outstanding at end of year | 997,045 | $ | 10.54 | 846,280 | $ | 11.28 | |||||||||||||||
Exercisable at end of year | 566,440 | 555,135 | |||||||||||||||||||
Weighted average fair value of options granted during the year | $ | 2.57 | $ | 3.45 | |||||||||||||||||
The options outstanding at September 30, 2013 have been segregated into four ranges for additional disclosure as follows: | |||||||||||||||||||||
Options Outstanding | Options Exercisable | ||||||||||||||||||||
Exercise Prices | Options | Weighted | Weighted | Options | Weighted | ||||||||||||||||
Outstanding at | Average | Average | Exercisable at | Average | |||||||||||||||||
September 30, | Remaining | Exercise | September 30, | Exercise | |||||||||||||||||
2013 | Contractual | Price | 2013 | Price | |||||||||||||||||
Life | |||||||||||||||||||||
$ 4.50 to $9.90 | 678,330 | 7.9 | $ | 7.73 | 281,022 | $ | 7.28 | ||||||||||||||
10.10 to 14.83 | 167,892 | 4.7 | 13.21 | 144,026 | 13.22 | ||||||||||||||||
15.00 to 19.40 | 109,315 | 4.6 | 15.95 | 99,884 | 16.02 | ||||||||||||||||
21.40 to 46.90 | 41,508 | 2.8 | 30.18 | 41,508 | 34.41 | ||||||||||||||||
997,045 | 566,440 | ||||||||||||||||||||
At September 30, 2013, there was $297 thousand of total unrecognized compensation cost related to non-vested stock-based compensation, including $75 thousand of estimated forfeitures. The cost is expected to be recognized over a weighted-average life of 1.9 years. | |||||||||||||||||||||
A summary of the status of the Company’s non-vested shares at September 30, 2013 and for the year then ended is presented below: | |||||||||||||||||||||
Shares | Weighted Average | ||||||||||||||||||||
Grant Date | |||||||||||||||||||||
Fair Value | |||||||||||||||||||||
Non-vested shares at October 1, 2012 | 291,145 | $ | 4.4 | ||||||||||||||||||
Granted | 310,100 | 2.57 | |||||||||||||||||||
Vested | (129,668 | ) | 3.84 | ||||||||||||||||||
Forfeited | (40,972 | ) | 4.17 | ||||||||||||||||||
Non-vested shares at September 30, 2013 | 430,605 | $ | 3.28 | ||||||||||||||||||
Stock-based compensation recorded in the year ended September 30, 2013 of $656 thousand was allocated $429 thousand to selling and marketing expenses, $40 thousand to general and administrative expenses and $187 thousand to product development expenses. Stock-based compensation recorded in the year ended September 30, 2012 of $742 thousand was allocated $485 thousand to selling and marketing expenses, $43 thousand to general and administrative expenses and $214 thousand to product development expenses. Cash received from exercises under all stock option plans and warrants for the years ended September 30, 2013 and 2012 was $448 thousand and $245 thousand, respectively. There were no tax benefits realized for tax deductions from option exercises for the years ended September 30, 2013 and 2012. The Company currently expects to satisfy stock-based awards with registered shares available to be issued. | |||||||||||||||||||||
The Company also has an Employee Stock Purchase Plan (Purchase Plan) under which an aggregate of 100,000 common shares may be issued. The Shareholders approved an amendment to increase the number of shares of common stock subject to the plan from 50,000 to 100,000 at the Company’s annual meeting in March 2011. All employees who have completed 90 days of employment with the Company on the first day of each offering period and customarily work twenty hours per week or more are eligible to participate in the Purchase Plan. An employee who, after the grant of an option to purchase, would hold common stock and/or hold outstanding options to purchase stock possessing 5% or more of the total combined voting power or value of the Company will not be eligible to participate. Eligible employees may make contributions through payroll deductions of up to 10% of their compensation. No participant in the Purchase Plan is permitted to purchase common stock under the Purchase Plan if such option would permit his or her rights to purchase stock under the Purchase Plan to accrue at a rate that exceeds $25,000 of the fair market value of such shares, or that exceeds 1,000 shares, for each calendar year. The Company makes a bi-annual offering to eligible employees of options to purchase shares of common stock under the Purchase Plan on the first trading day of January and July. Each offering period is for a period of six months from the date of the offering, and each eligible employee as of the date of offering is entitled to purchase shares of common stock at a purchase price equal to the lower of 85% of the fair market value of common stock on the first or last trading day of the offering period. A total of 14,346 shares are available to be issued under the plan. There were 15,062 and 21,010 shares purchased by employees during fiscal 2013 and 2012, respectively. The Company recorded stock compensation expense under this plan of $19 and $26 thousand during fiscal 2013 and 2012, respectively. Cash received from issuance of stock under this plan was $75 and $134 thousand during fiscal 2013 and 2012, respectively. | |||||||||||||||||||||
Income_Taxes
Income Taxes | 12 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Income Taxes | ' | ||||||||
6. Income Taxes | |||||||||
The provision for income taxes consists of the following (in thousands): | |||||||||
Years Ended September 30, | |||||||||
2013 | 2012 | ||||||||
Current tax benefit | $ | — | $ | — | |||||
Deferred income tax expense | 240 | 240 | |||||||
Provision for income taxes | $ | 240 | $ | 240 | |||||
The reconciliation of income tax expense (benefit) computed at the U.S. federal statutory rate to income tax expense (benefit) is as follows (in thousands): | |||||||||
Years Ended September 30, | |||||||||
2013 | 2012 | ||||||||
Income tax expense (benefit) at U.S. statutory rate of 34% | $ | (188 | ) | $ | 135 | ||||
Federal income tax refundable research credit | — | — | |||||||
State income tax expense (benefit) | (11 | ) | 105 | ||||||
Permanent differences, net | 111 | 93 | |||||||
Adjustment of temporary differences to income tax returns | (110 | ) | 264 | ||||||
Change in valuation allowance | 438 | (357 | ) | ||||||
Income tax expense | $ | 240 | $ | 240 | |||||
The significant components of the deferred tax accounts recognized for financial reporting purposes are as follows (in thousands): | |||||||||
September 30, | |||||||||
2013 | 2012 | ||||||||
Deferred tax assets: | |||||||||
Net operating loss and other carryforwards | $ | 35,001 | $ | 34,352 | |||||
Common stock warrants | 636 | 519 | |||||||
Allowance for doubtful accounts | 35 | 33 | |||||||
Other | 47 | 175 | |||||||
Total deferred tax assets | 35,719 | 35,079 | |||||||
Deferred tax liabilities: | |||||||||
Fixed assets | (129 | ) | — | ||||||
Other | (321 | ) | (248 | ) | |||||
Total deferred tax liabilities | (450 | ) | (248 | ) | |||||
Net deferred tax asset | 35,269 | 34,831 | |||||||
Valuation allowance | (35,269 | ) | (34,831 | ) | |||||
Goodwill amortization | (2,210 | ) | (1,970 | ) | |||||
Deferred tax liability for goodwill amortization | $ | (2,210 | ) | $ | (1,970 | ) | |||
At September 30, 2013, the Company had net operating loss carryforwards of approximately $89 million for U.S. Federal and $51 million for state tax purposes. For Federal tax purposes, the carryforwards expire in varying amounts between 2019 and 2033. For state tax purposes, the carryforwards expire in varying amounts between 2014 and 2032. Utilization of the Company’s net operating loss may be subject to substantial annual limitation due to the ownership change limitations provided by the Internal Revenue Code and similar state provisions. Such an | |||||||||
annual limitation could result in the expiration of the net operating loss carryforwards before utilization. In addition, the Company has research and development tax credit carryforwards of approximately $500 thousand, which expire in varying amounts between 2017 and 2020. | |||||||||
Deferred income taxes are provided for temporary differences between financial reporting and income tax basis of assets and liabilities, and are measured using currently enacted tax rates and laws. Deferred income taxes also arise from the future benefits of net operating loss carryforwards. A valuation allowance equal to 100% of the net deferred tax assets has been recognized due to uncertainty regarding future realization, as a result of the Company’s past history of losses. | |||||||||
Beginning with an acquisition in fiscal year 2002, the Company has amortized Goodwill for tax purposes over a 15 year life. Goodwill is not amortized for book purposes. Annual impairment tests are performed for book purposes and the balance of goodwill is to be written down if impairment occurs. The impairment tests have not indicated any goodwill impairment. | |||||||||
The difference between the book and tax balance of Goodwill creates a Deferred Tax Liability and an annual tax expense. Because of the long term nature of the goodwill timing difference, tax planning strategies cannot be applied related to the Deferred Tax Liability. The Company’s tax rate differs from the expected tax rate each reporting period as a result of the aforementioned items. The balance of the Deferred Tax Liability at September 30, 2013 was $2.21 million and $1.97 million at September 30, 2012. | |||||||||
In accordance with accounting guidance for uncertainty in income taxes, the Company has concluded that a reserve for income tax contingencies is not necessary. The Company’s practice is to recognize interest and/or penalties related to income tax matters in income tax expense. The Company had no accruals for interest and penalties on the Company’s consolidated balance sheets at September 30, 2013 and 2012, and has not recognized any interest or penalties in the consolidated statement of operations for the years ended September 30, 2013 or 2012. | |||||||||
The Company is subject to taxation in the U.S. and various state jurisdictions. All of the Company’s tax years are subject to examination by the U.S. and state tax authorities due to the carryforward of unutilized net operating losses. | |||||||||
Stock_Repurchase_Program
Stock Repurchase Program | 12 Months Ended |
Sep. 30, 2013 | |
Stock Repurchase Program | ' |
7. Stock Repurchase Program | |
On May 31, 2013, the Company’s Board of Directors authorized a $1 million common stock repurchase program. Under the program, the Company’s common shares may be repurchased in open market transactions or in privately negotiated transactions. The exact amount and timing of any purchases will depend on a number of factors, including trading price, trading volume and general market conditions. The repurchase program may be suspended or discontinued at any time. The Company has not repurchased any shares of its common stock as of September 30, 2013. |
Savings_Plan
Savings Plan | 12 Months Ended |
Sep. 30, 2013 | |
Savings Plan | ' |
8. Savings Plan | |
The Company’s defined contribution 401(k) savings plan covers substantially all employees meeting certain minimum eligibility requirements. Participating employees can elect to defer a portion of their compensation and contribute it to the plan on a pretax basis. The Company may also match certain amounts and/or provide additional discretionary contributions, as defined. The Company made matching contributions of $275 and $316 thousand during the years ended September 30, 2013 and 2012, respectively. The Company made no additional discretionary contributions during 2013 and 2012. |
RelatedParty_Transactions
Related-Party Transactions | 12 Months Ended |
Sep. 30, 2013 | |
Related-Party Transactions | ' |
9. Related-Party Transactions | |
The Company incurred fees of $171 and $186 thousand during the years ended September 30, 2013 and 2012, respectively, to a law firm whose partner is a director and stockholder of the Company. The Company had accrued liabilities for unbilled services to the same law firm of $14 and $30 thousand at September 30, 2013 and 2012, respectively. | |
The Company recorded Mediasite product and customer support revenue of $1.3 million and $1.0 million during the years ended September 30, 2013 and 2012, respectively, to Mediasite KK, a Japanese reseller in which the Company has an equity interest. Mediasite KK owed the Company $280 and $240 thousand at September 30, 2013 and 2012, respectively. | |
As of September 30, 2013 and 2012, the Company had a loan outstanding to an executive totaling $26 thousand. The loan is collateralized by Company stock. |
Equity_in_earnings_from_invest
Equity in earnings from investment in Mediasite KK | 12 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Equity in earnings from investment in Mediasite KK | ' | ||||||||
10. Equity in earnings from investment in Mediasite KK | |||||||||
The Company’s investment in Mediasite KK is accounted for under the equity method of accounting using a one quarter timing lag. The Company’s current ownership percentage is approximately 26% of their common stock as compared to 23% as of the end of fiscal 2012. The Company recorded equity in earnings of $209 thousand and $420 thousand for the years ended September 30, 2013 and September 30, 2012, respectively. The recorded value of this investment, net of foreign currency translation adjustment, is $385 thousand as of September 30, 2013 and $420 thousand as of September 30, 2012. The Company also received a $22 thousand dividend from Mediasite KK during the year ended September 30, 2013. The results of operations for Mediasite KK for their year ended June 30 are listed in the table below. | |||||||||
Year ended | Year ended | ||||||||
June 30, 2013 | June 30, 2012 | ||||||||
Revenue | $ | 8,503,000 | $ | 9,050,000 | |||||
Gross margin | 6,181,000 | 6,338,000 | |||||||
Income from operations | 1,381,000 | 2,343,000 | |||||||
Net income | 889,000 | 1,425,000 |
Goodwill_and_Other_Intangible_
Goodwill and Other Intangible Assets | 12 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Goodwill and Other Intangible Assets | ' | ||||||||||||||||
11. Goodwill and Other Intangible Assets | |||||||||||||||||
Goodwill and intangible assets that have indefinite useful lives are not amortized but, instead, tested at least annually for impairment. The Company assesses the impairment of goodwill on an annual basis or whenever events or changes in circumstances indicate that the fair value of these assets is less than the carrying value. | |||||||||||||||||
If the Company determines that the fair value of goodwill is less than its carrying value, based upon the annual test or the existence of impairment, the Company would then measure impairment based on a comparison of the implied fair value of goodwill with the carrying amount of goodwill. To the extent the carrying amount of goodwill is greater than the implied fair value of goodwill, an impairment charge for the difference would be recorded. The Company performs annual goodwill impairment test as of July 1, 2013 and tested goodwill recognized in connection with the acquisition of Mediasite and determined it was not impaired. | |||||||||||||||||
The following tables present details of the Company’s total intangible assets at September 30, 2013 and 2012: | |||||||||||||||||
(in thousands) | Life | Gross | Accumulated | Balance at | |||||||||||||
(years) | Amortization at | September 30, | |||||||||||||||
September 30, | 2013 | ||||||||||||||||
2013 | |||||||||||||||||
Amortizable: | |||||||||||||||||
Loan origination fees | 3 | $ | 150 | $ | 135 | $ | 15 | ||||||||||
150 | 135 | 15 | |||||||||||||||
Non-amortizable goodwill | 7,576 | — | 7,576 | ||||||||||||||
Total | $ | 7,726 | $ | 135 | $ | 7,591 | |||||||||||
(in thousands) | Life | Gross | Accumulated | Balance at | |||||||||||||
(years) | Amortization at | September 30, | |||||||||||||||
September 30, | 2012 | ||||||||||||||||
2012 | |||||||||||||||||
Amortizable: | |||||||||||||||||
Loan origination fees | 3 | $ | 195 | $ | 180 | $ | 15 | ||||||||||
195 | 180 | 15 | |||||||||||||||
Non-amortizable goodwill | 7,576 | — | 7,576 | ||||||||||||||
Total | $ | 7,771 | $ | 180 | $ | 7,591 | |||||||||||
Segment_Information
Segment Information | 12 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Segment Information | ' | ||||||||
12. Segment Information | |||||||||
The Company has determined that it operates in only one segment as it does not disaggregate profit and loss information on a segment basis for internal management reporting purposes to its chief operating decision maker. | |||||||||
The Company’s long-lived assets maintained outside the United States are insignificant. | |||||||||
The following summarizes revenue by geographic region (in thousands): | |||||||||
Years Ended | |||||||||
September 30, | |||||||||
2013 | 2012 | ||||||||
United States | $ | 20,610 | $ | 20,014 | |||||
Europe and Middle East | 3,621 | 3,189 | |||||||
Asia | 1,772 | 1,740 | |||||||
Other | 1,753 | 1,147 | |||||||
Total | $ | 27,756 | $ | 26,090 | |||||
Customer_Concentration
Customer Concentration | 12 Months Ended |
Sep. 30, 2013 | |
Customer Concentration | ' |
13. Customer Concentration | |
In the fiscal year ended September 30, 2013 and 2012, two distributors represented 42% and 43% of total revenue. At September 30, 2013 and 2012, these two distributors represented 56% of total accounts receivable. |
Legal_Proceedings
Legal Proceedings | 12 Months Ended |
Sep. 30, 2013 | |
Legal Proceedings | ' |
14. Legal Proceedings | |
From time to time, the Company is subject to legal proceedings or claims arising from its normal course of operations. The Company accrues for costs related to loss contingencies when such costs are probable and reasonably estimable. As of September 30, 2013, the Company is not aware of any material pending legal proceedings or threatened litigation that would have a material adverse effect on the Company’s financial condition or results of operations, although no assurance can be given with respect to the ultimate outcome of pending actions. | |
On October 26, 2012, a complaint was filed by Astute Technology, LLC (“Astute”) against Learners Digest International, LLC (“Learners Digest”), one of our customers, in the United States District Court for the Eastern District of Texas (Case No. 2:012-cv-689). The complaint alleges patent infringement. Because Learners Digest is a customer, we have agreed to indemnify them from costs and damages in connection with the litigation. We believe the complaint is without merit and intend to defend the lawsuit vigorously. | |
On February 5, 2013, we filed a complaint against Astute in the Western District of Wisconsin (Case No. 13-cv-87). The complaint is for declaratory judgment of non-infringement and invalidity of three United States patents held by Astute. On November 22, 2013 the court ordered the case be dismissed for lack of personal jurisdiction. | |
On December 3, 2013, we filed a complaint against Astute in the Eastern District of Virginia (Civil Action No. 2:13-cv-681). The complaint is for declaratory judgment of non-infringement and invalidity of three United States Patents held by Astute. | |
Quarterly_Financial_Data_unaud
Quarterly Financial Data (unaudited) | 12 Months Ended | ||||||||||||||||||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||||||||||||||||||
Quarterly Financial Data (unaudited) | ' | ||||||||||||||||||||||||||||||||
15. Quarterly Financial Data (unaudited) | |||||||||||||||||||||||||||||||||
The following table sets forth selected quarterly financial information for the years ended September 30, 2013 and 2012. The operating results are not necessarily indicative of results for any future period. | |||||||||||||||||||||||||||||||||
Quarterly Financial Data | |||||||||||||||||||||||||||||||||
(in thousands except per share data) | Q4-’13 | Q3-’13 | Q2-’13 | Q1-’13 | Q4-’12 | Q3-’12 | Q2-’12 | Q1-’12 | |||||||||||||||||||||||||
Revenue | $ | 6,761 | $ | 8,013 | $ | 6,430 | $ | 6,552 | $ | 6,219 | $ | 7,757 | $ | 5,928 | $ | 6,185 | |||||||||||||||||
Gross margin | 4,892 | 5,611 | 4,690 | 4,867 | 4,497 | 5,555 | 4,284 | 4,507 | |||||||||||||||||||||||||
Income (loss) from operations | (582 | ) | 109 | (34 | ) | (131 | ) | (186 | ) | 399 | (32 | ) | (72 | ) | |||||||||||||||||||
Equity in earnings from investment in Mediasite KK | 30 | 11 | 90 | 78 | 170 | 250 | — | — | |||||||||||||||||||||||||
Net income (loss) | (666 | ) | 40 | (27 | ) | (139 | ) | (103 | ) | 559 | (115 | ) | (184 | ) | |||||||||||||||||||
Basic and diluted net income (loss) per share | $ | (0.17 | ) | $ | 0.01 | $ | (0.01 | ) | $ | (0.04 | ) | $ | (0.03 | ) | $ | 0.14 | $ | (0.03 | ) | $ | (0.05 | ) |
Subsequent_Events
Subsequent Events | 12 Months Ended |
Sep. 30, 2013 | |
Subsequent Events | ' |
16. Subsequent Events | |
On November 19, 2013, Sonic Foundry entered into a non-binding term sheet to purchase the remaining shares of stock in Mediasite KK in Japan. Under the terms of the non-binding term sheet, Sonic Foundry will pay approximately ¥585 million ($5.85 million) for the remaining stock in Mediasite K.K., comprised of equal components of approximately $1.95 million cash, subordinated note payable in one year (interest rate of 6.5%) and value in shares of Sonic Foundry. The transaction is subject to execution of a definitive stock purchase agreement and customary closing conditions. | |
On December 9, 2013, Sonic Foundry entered into a definitive agreement to acquire MediaMission Holding B.V. (“MediaMission”) in the Netherlands. The purchase was closed on December 16, 2013. Sonic Foundry paid €1.1 million for all the outstanding stock in MediaMission, comprised of €330,000 ($453,000) cash, €495,000 ($680,000) subordinated note payable over three years (interest rate of 6.5%) and €275,000 ($373,000) in shares of Sonic Foundry stock. The stock portion of the purchase price consisted of 37,608 shares of Sonic Foundry common stock, calculated at a per share price of $9.92, which was based on the average closing share price over the twenty day trading period before the announcement. Assets acquired include cash, accounts receivable, inventory, fixed assets, and goodwill and liabilities assumed include accounts payable and liabilities owed to the former shareholders. The purchase price allocation has not been finalized as the Company is in the process of completing its valuation process. | |
Basis_of_Presentation_and_Sign1
Basis of Presentation and Significant Accounting Policies (Policies) | 12 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Business | ' | ||||||||
Business | |||||||||
Sonic Foundry, Inc. (the Company) is in the business of providing enterprise solutions and services for the web communications market. | |||||||||
Principles of Consolidation | ' | ||||||||
Principles of Consolidation | |||||||||
The accompanying consolidated financial statements include the accounts of the Company and its wholly-owned subsidiary, Sonic Foundry Media Systems, Inc. All significant intercompany transactions and balances have been eliminated. | |||||||||
Under the equity method of accounting, the Company’s investment in unconsolidated affiliates are initially recorded as an investment in the stock of an investee at cost and are adjusted on a quarterly basis for the carrying amount of the investment to recognize the investor’s share of changes in the net assets of the investee after the date of the initial investment. | |||||||||
Use of Estimates | ' | ||||||||
Use of Estimates | |||||||||
In preparing financial statements in conformity with accounting principles generally accepted in the United States of America (US GAAP), management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expense during the period. Actual results could differ from those estimates. | |||||||||
Revenue Recognition | ' | ||||||||
Revenue Recognition | |||||||||
General | |||||||||
Revenue is recognized when persuasive evidence of an arrangement exists, delivery occurs or services are rendered, the sales price is fixed or determinable and collectability is reasonably assured. Revenue is deferred when undelivered products or services are essential to the functionality of delivered products, customer acceptance is uncertain, significant obligations remain, or the fair value of undelivered elements is unknown. The Company does not offer customers the right to return product, other than for exchange or repair pursuant to a warranty or stock rotation. The Company’s policy is to reduce revenue if it incurs an obligation for price rebates or other such programs during the period the obligation is reasonably estimated to occur. The following policies apply to the Company’s major categories of revenue transactions. | |||||||||
Products | |||||||||
Products are considered delivered, and revenue is recognized, when title and risk of loss have been transferred to the customer. Under the terms and conditions of the sale, this occurs at the time of shipment to the customer. Product revenue currently represents sales of our Mediasite recorder and Mediasite related products such as our server software and other software licenses. If a license is time-based, the revenue is recognized over the term of the license agreement. | |||||||||
Services | |||||||||
The Company sells support and content hosting contracts to our customers, typically one year in length, and records the related revenue ratably over the contractual period. Our support contracts cover phone and electronic technical support availability over and above the level provided by our distributors, software upgrades on a when and if available basis, advance hardware replacement and an extension of the standard hardware warranty from 90 days to one year. The manufacturers the Company contracts with to build the units provide a limited one-year warranty on the hardware. The Company also sells installation, training, event webcasting, and customer content hosting services. Revenue for those services is recognized when performed in the case of installation, training and event webcasting services. Service amounts invoiced to customers in excess of revenue recognized are recorded as deferred revenue until the revenue recognition criteria are met. | |||||||||
Revenue Arrangements that Include Multiple Elements | |||||||||
Sales of software, with or without installation, training, and post customer support fall within the scope of the software revenue recognition rules. Under the software revenue recognition rules, the fee from a multiple-deliverable arrangement is allocated to each of the undelivered elements based upon vendor-specific objective evidence (VSOE), which is limited to the price charged when the same deliverable is sold separately, with the residual value from the arrangement allocated to the delivered element. The portion of the fee that is allocated to each deliverable is then recognized as revenue when the criteria for revenue recognition are met with respect to that deliverable. If VSOE does not exist for all of the undelivered elements, then all revenue from the arrangement is typically deferred until all elements have been delivered to the customer. All revenue arrangements, with the exception of hosting contracts, entered into prior to October 1, 2010 and the sale of all software-only products and associated services have been accounted for under this guidance. | |||||||||
In the case of the Company’s hardware products with embedded software, the Company has determined that the hardware and software components function together to deliver the product’s essential functionality, and therefore, the revenue from the sale of these products is accounted for under the revenue recognition rules for tangible products whereby the fee from a multiple-deliverable arrangement is allocated to each of the deliverables based upon their relative selling prices as determined by a selling-price hierarchy. A deliverable in an arrangement qualifies as a separate unit of accounting if the delivered item has value to the customer on a stand-alone basis. A delivered item that does not qualify as a separate unit of accounting is combined with the other undelivered items in the arrangement and revenue is recognized for those combined deliverables as a single unit of accounting. The selling price used for each deliverable is based upon VSOE if available, third-party evidence (TPE) if VSOE is not available, and best estimate of selling price (ESP) if neither VSOE nor TPE are available. TPE is the price of the Company’s or any competitor’s largely interchangeable products or services in stand-alone sales to similarly situated customers. ESP is the price at which the Company would sell the deliverable if it were sold regularly on a stand-alone basis, considering market conditions and entity-specific factors. All revenue arrangements negotiated after September 30, 2010, excluding the sale of all software-only products and associated services, have been accounted for under this guidance. | |||||||||
The selling prices used in the relative selling price allocation method are as follows: (1) the Company’s products and services are based upon VSOE and (2) hardware products with embedded software, for which VSOE does not exist, are based upon ESP. The Company does not believe TPE exists for any of these products and services because they are differentiated from competing products and services in terms of functionality and performance and there are no competing products or services that are largely interchangeable. Management establishes ESP for hardware products with embedded software using a cost plus margin approach with consideration for market conditions, such as the impact of competition and geographic considerations, and entity-specific factors, such as the cost of the product and the Company’s profit objectives. Management believes that ESP is reflective of reasonable pricing of that deliverable as if priced on a stand-alone basis. When a sales transaction includes deliverables that are divided between ASC Topic 605 and ASC Subtopic 985-605, the Company allocates the selling price using the relative selling price method whereas value is allocated using an ESP for software developed using a percent of list price approach. The other deliverables are valued using ESP or VSOE as previously discussed. | |||||||||
While the pricing model, currently in use, captures all critical variables, unforeseen changes due to external market forces may result in a revision of the inputs. These modifications may result in the consideration allocation differing from the one presently in use. Absent a significant change in the pricing inputs or the way in which the industry structures its transactions, future changes in the pricing model are not expected to materially affect our allocation of arrangement consideration. | |||||||||
Management has established VSOE for hosting services. Billings for hosting are spread ratably over the term of the hosting agreement, with the typical hosting agreement having a term of 12 months, with renewal on an annual basis. The Company sells most hosting contracts without the inclusion of products. When the hosting arrangement is sold in conjunction with product, the product revenue is recognized immediately while the remaining hosting revenue is spread ratably over the term of the hosting agreement. The selling price is allocated between these elements using the relative selling price method. The Company uses ESP for development of the selling price for hardware products with embedded software. | |||||||||
The Company also offers hosting services bundled with events services. The Company uses VSOE to establish relative selling prices for its events services. The Company recognizes events revenue when the event takes place and recognizes the hosting revenue over the term of the hosting agreement. The total amount of the arrangement is allocated to each element based on the relative selling price method. | |||||||||
Reserves | |||||||||
The Company reserves for stock rotations, price adjustments, rebates, and sales incentives to reduce revenue and accounts receivable for these and other credits granted to customers. Such reserves are recorded at the time of sale and are calculated based on historical information (such as rates of product stock rotations) and the specific terms of sales programs, taking into account any other known information about likely customer behavior. If actual customer behavior differs from our expectations, additional reserves may be required. Also, if the Company determines that it can no longer accurately estimate amounts for stock rotations and sales incentives, the Company would not be able to recognize revenue until resellers sell the inventory to the final end user. | |||||||||
Shipping and Handling | |||||||||
The Company’s shipping and handling costs billed to customers are included in other revenue. Costs related to shipping and handling are included in cost of revenue and are recorded at the time of shipment to the customer. | |||||||||
Concentration of Credit Risk and Other Risks and Uncertainties | ' | ||||||||
Concentration of Credit Risk and Other Risks and Uncertainties | |||||||||
The Company’s cash and cash equivalents are deposited with two major financial institutions. At times, deposits in these institutions exceed the amount of insurance provided on such deposits. The Company has not experienced any losses on such amounts and believes that it is not exposed to any significant credit risk on these balances. | |||||||||
We assess the realization of our receivables by performing ongoing credit evaluations of our customers’ financial condition. Through these evaluations, we may become aware of a situation where a customer may not be able to meet its financial obligations due to deterioration of its financial viability, credit ratings or bankruptcy. Our reserve requirements are based on the best facts available to us and are reevaluated and adjusted as additional information is received. Our reserves are also based on amounts determined by using percentages applied to certain aged receivable categories. These percentages are determined by a variety of factors including, but not limited to, current economic trends, historical payment and bad debt write-off experience. Allowance for doubtful accounts for accounts receivable was $90,000 at September 30, 2013 and $85,000 at September 30, 2012. | |||||||||
We had billings for Mediasite product and support services as a percentage of total billings to one distributor of approximately 20% in 2013 and 18% in 2012 and to a second distributor of approximately 22% in 2013 and 25% in 2012. At September 30, 2013 and 2012, these two distributors represented 56% of total accounts receivable. | |||||||||
Currently all of our product inventory purchases are from one third-party contract manufacturer. Although we believe there are multiple sources of supply from other contract manufacturers as well as multiple suppliers of component parts required by the contract manufacturers, a disruption of supply of component parts or completed products, even if short term, would have a material negative impact on our revenues. At September 30, 2013 and 2012, this supplier represented 34% and 60%, respectively, of total accounts payable. We also license technology from third parties that is embedded in our software. We believe there are alternative sources of similar licensed technology from other third parties that we could also embed in our software, although it could create potential programming related issues that might require engineering resources. | |||||||||
Cash and Cash Equivalents | ' | ||||||||
Cash and Cash Equivalents | |||||||||
The Company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents. | |||||||||
Trade Accounts Receivable | ' | ||||||||
Trade Accounts Receivable | |||||||||
The majority of the Company’s accounts receivable are due from entities in, or distributors or value added resellers to, the education, corporate and government sectors. Credit is extended based on evaluation of a customer’s financial condition and, generally, collateral is not required. Accounts receivable are typically due within 30 days and are stated at amounts due from customers net of an allowance for doubtful accounts. Accounts outstanding longer than the contractual payment terms are considered to be past due. The Company determines its allowance by considering a number of factors, including the length of time trade accounts receivable are past due, the Company’s previous loss history, the customer’s current ability to pay its obligation to the Company, and the condition of the general economy and the industry as a whole. The Company writes-off accounts receivable when they become uncollectible, and payments subsequently received on such receivables are credited to the allowance for doubtful accounts. Interest is not accrued on past due receivables. | |||||||||
Inventory Valuation | ' | ||||||||
Inventory Valuation | |||||||||
Inventory consists of raw materials and supplies used in the assembly of Mediasite recorders and finished units. Inventory of completed units and spare parts are carried at the lower of cost or market, with cost determined on a first-in, first-out basis. | |||||||||
Inventory consists of the following (in thousands): | |||||||||
September 30, | |||||||||
2013 | 2012 | ||||||||
Raw materials and supplies | $ | 516 | $ | 216 | |||||
Finished goods | 931 | 837 | |||||||
$ | 1,447 | $ | 1,053 | ||||||
Capitalized Software Development Costs | ' | ||||||||
Capitalized Software Development Costs | |||||||||
Software development costs incurred in conjunction with product development are charged to research and development expense until technological feasibility is established. Thereafter, until the product is released for sale, software development costs are capitalized and reported at the net realizable value of the related product. Typically the period between achieving technological feasibility of the Company’s products and the general availability of the products has been short. Consequently, software development costs qualifying for capitalization are typically immaterial and are generally expensed to research and development costs. During 2013, the Company’s My Mediasite product release required software capitalization since there was a longer period between technological feasibility and the general availability of the product. Upon product release, the amortization of software development costs is determined annually as the greater of the amount computed using the ratio of current gross revenues for the products to their total of current and anticipated future gross revenues or the straight-line method over the estimated economic life of the products, expected to be three years. Amortization expense of software development costs of $75 thousand at September 30, 2013 is included in Cost of Revenue – Product. The amount of capitalized external and internal development costs is $533 thousand for the year ended September 30, 2013. There were no development costs capitalized in period ended September 30, 2012. | |||||||||
Equity in earnings from investment in Mediasite KK | ' | ||||||||
Equity in earnings from investment in Mediasite KK | |||||||||
The Company’s investment in Mediasite KK is accounted for under the equity method of accounting using a one quarter timing lag. The Company’s current ownership percentage is approximately 26% of their common stock as compared to 23% as of the end of fiscal 2012. The Company recorded equity in earnings of $209 thousand and $420 thousand for the years ended September 30, 2013 and September 30, 2012, respectively. The recorded value of this investment, net of foreign currency translation adjustment, is $385 thousand as of September 30, 2013 and $420 thousand as of September 30, 2012. The Company also received a $22 thousand dividend from Mediasite KK during the year ended September 30, 2013. | |||||||||
Property and Equipment | ' | ||||||||
Property and Equipment | |||||||||
Property and equipment are recorded at cost and are depreciated using the straight-line method for financial reporting purposes. The estimated useful lives used to calculate depreciation are as follows: | |||||||||
Years | |||||||||
Leasehold improvements | 5 to 10 years | ||||||||
Computer equipment | 3 to 5 years | ||||||||
Furniture and fixtures | 5 to 7 years | ||||||||
Impairment of Long-Lived Assets | ' | ||||||||
Impairment of Long-Lived Assets | |||||||||
We assess the impairment of goodwill on an annual basis or whenever events or changes in circumstances indicate that the fair value of these assets is less than the carrying value. In fiscal 2012 with the adoption of ASU 2011-08, “Testing Goodwill for Impairment”, we first assessed qualitative factors related to goodwill to determine whether it is more likely than not that the fair value of the reporting unit is less than its carrying amount as a basis for determining whether it is necessary to perform the two-step goodwill test. The more-likely-than-not threshold is defined as having a likelihood of more than 50 percent. Using the qualitative assessment, we determined that the fair value of goodwill is more likely than not greater than its carrying amount thus step two was not deemed necessary to perform. In fiscal 2013, we performed the two-step goodwill test and determined that the fair value of goodwill is more than the carrying value. The Company has recognized no impairment charges as of September 30, 2013 and September 30, 2012. | |||||||||
If we had determined that the fair value of goodwill is less than its carrying value, based upon the annual test or the existence of one or more indicators of impairment, we would then measure impairment based on a comparison of the implied fair value of goodwill with the carrying amount of goodwill. To the extent the carrying amount of goodwill is greater than the implied fair value of goodwill, we would record an impairment charge for the difference. | |||||||||
Long-lived assets and intangible assets other than goodwill are evaluated for impairment whenever events or changes in circumstances indicate that the carrying value of an asset may not be recoverable based on expected undiscounted cash flows attributable to that asset. For the years ended September 30, 2013 and 2012, no events or changes in circumstances occurred that required this analysis. | |||||||||
Comprehensive Income (Loss) | ' | ||||||||
Comprehensive Income (Loss) | |||||||||
Comprehensive income (loss) includes disclosure of financial information that historically has not been recognized in the calculation of net income. Our comprehensive income (loss) encompasses net income (loss) and foreign currency translation. Assets and liabilities of international operations that have a functional currency that is not in U.S. dollars are translated into U.S. dollars at year-end exchange rates, and revenue and expense items are translated using weighted average exchange rates. Any adjustments arising on translation are included in shareholders’ equity as an element of accumulated other comprehensive income (loss). | |||||||||
Advertising Expense | ' | ||||||||
Advertising Expense | |||||||||
Advertising costs included in selling and marketing, are expensed when the advertising first takes place. Advertising expense was $238 and $261 thousand for years ended September 30, 2013 and 2012, respectively. | |||||||||
Research and Development Costs | ' | ||||||||
Research and Development Costs | |||||||||
Research and development costs are expensed in the period incurred, unless they meet the criteria for capitalized software development costs. | |||||||||
Income Taxes | ' | ||||||||
Income Taxes | |||||||||
Deferred income taxes are provided for temporary differences between financial reporting and income tax basis of assets and liabilities, and are measured using currently enacted tax rates and laws. Deferred income taxes also arise from the future benefits of net operating loss carryforwards. A valuation allowance equal to 100% of the net deferred tax assets has been recognized due to uncertainty regarding the future realization. | |||||||||
The Company also accounts for the uncertainty in income taxes related to the recognition and measurement of a tax position and measurement of a tax position taken or expected to be taken in an income tax return. The Company follows the applicable accounting guidance on derecognition, classification, interest and penalties, accounting in interim periods and disclosure related to the uncertainty in income tax positions. | |||||||||
Fair Value of Financial Instruments | ' | ||||||||
Fair Value of Financial Instruments | |||||||||
The Company’s financial instruments consist primarily of cash and cash equivalents, accounts receivable, accounts payable and debt instruments. The book values of cash and cash equivalents, accounts receivable, debt and accounts payable are considered to be representative of their respective fair values. The carrying value of capital lease obligations, including the current portion, approximates fair market value as the fixed rate approximates the current market rate of interest available to the Company. | |||||||||
Stock-Based Compensation | ' | ||||||||
Stock-Based Compensation | |||||||||
The Company uses a lattice valuation model to account for all employee stock options granted. The lattice valuation model provides a flexible analysis to value options because of its ability to incorporate inputs that change over time, such as actual exercise behavior of option holders. The Company uses historical data to estimate the option exercise and employee departure behavior in the lattice valuation model. Expected volatility is based on historical volatility of the Company’s stock. The Company considers all employees to have similar exercise behavior and therefore has not identified separate homogenous groups for valuation. The expected term of options granted is derived from the output of the option pricing model and represents the period of time that options granted are expected to be outstanding. The risk-free rate for periods the options are expected to be outstanding is based on the U.S. Treasury yields in effect at the time of grant. Forfeitures are based on actual behavior patterns. | |||||||||
The fair value of each option grant is estimated using the assumptions in the following table: | |||||||||
Years Ending | |||||||||
September 30, | |||||||||
2013 | 2012 | ||||||||
Expected life | 4.7 – 4.8 years | 4.7 – 4.8 years | |||||||
Risk-free interest rate | 0.35%-0.61% | 0.40% | |||||||
Expected volatility | 46.8% - 49.3% | 51.4% - 64.0% | |||||||
Expected forfeiture rate | 11.8%-13.0% | 12.0%-13.1% | |||||||
Expected exercise factor | 1.36-1.37 | 1.34 – 1.36 | |||||||
Expected dividend yield | 0% | 0% | |||||||
Per Share Computation | ' | ||||||||
Per Share Computation | |||||||||
Basic earnings per share has been computed using the weighted-average number of shares of common stock outstanding during the period, less shares that may be repurchased, and excludes any dilutive effects of options and warrants. In periods where the Company reports net income, diluted net income per share is computed using common equivalent shares related to outstanding options and warrants to purchase common stock. The numerator for the calculation of basic and diluted earnings per share is net income (loss). The following table sets forth the computation of basic and diluted weighted average shares used in the earnings per share calculations: | |||||||||
Years Ending | |||||||||
September 30, | |||||||||
2013 | 2012 | ||||||||
Denominator for basic earnings per share | |||||||||
- weighted average common shares | 3,932,692 | 3,857,161 | |||||||
Effect of dilutive options and warrants (treasury method) | — | 50,727 | |||||||
Denominator for diluted earnings per share | |||||||||
- adjusted weighted average common shares | 3,932,692 | 3,907,888 | |||||||
Options and warrants outstanding during each year, but not included in the computation of diluted earnings per share because they are antidilutive | 997,045 | 576,863 | |||||||
Reclassifications | ' | ||||||||
Reclassifications | |||||||||
Reclassifications have been made to the September 30, 2012 notes to the financial statements to conform to the September 30, 2013 presentation. | |||||||||
Recent Accounting Pronouncements | ' | ||||||||
Recent Accounting Pronouncements | |||||||||
In July 2013, the FASB issued ASU 2013-11, “Income Taxes (Topic 740)—Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists.” The amendments in this ASU provide guidance for the financial statement presentation of an unrecognized tax benefit when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists. The amendments in this ASU are expected to reduce diversity in practice by providing guidance on the presentation of unrecognized tax benefits and will better reflect the manner in which an entity would settle at the reporting date any additional income taxes that would result from the disallowance of a tax position when net operating loss carryforwards, similar tax losses, or tax credit carryforwards exist. This update is effective for fiscal years, and interim periods within those years, beginning after December 15, 2013. The adoption of this guidance is not expected to have an impact on the Company’ | |||||||||
Accounting standards that have been issued but are not yet effective by the FASB or other standards-setting bodies that do not require adoption until a future date are not expected to have a material impact on the Company’s financial statements upon adoption. |
Basis_of_Presentation_and_Sign2
Basis of Presentation and Significant Accounting Policies (Tables) | 12 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Inventory | ' | ||||||||
Inventory consists of the following (in thousands): | |||||||||
September 30, | |||||||||
2013 | 2012 | ||||||||
Raw materials and supplies | $ | 516 | $ | 216 | |||||
Finished goods | 931 | 837 | |||||||
$ | 1,447 | $ | 1,053 | ||||||
Estimated Useful Lives of Property and Equipment | ' | ||||||||
Property and equipment are recorded at cost and are depreciated using the straight-line method for financial reporting purposes. The estimated useful lives used to calculate depreciation are as follows: | |||||||||
Years | |||||||||
Leasehold improvements | 5 to 10 years | ||||||||
Computer equipment | 3 to 5 years | ||||||||
Furniture and fixtures | 5 to 7 years | ||||||||
Fair Value Assumptions for Stock Options Granted | ' | ||||||||
The fair value of each option grant is estimated using the assumptions in the following table: | |||||||||
Years Ending | |||||||||
September 30, | |||||||||
2013 | 2012 | ||||||||
Expected life | 4.7 – 4.8 years | 4.7 – 4.8 years | |||||||
Risk-free interest rate | 0.35%-0.61% | 0.40% | |||||||
Expected volatility | 46.8% - 49.3% | 51.4% - 64.0% | |||||||
Expected forfeiture rate | 11.8%-13.0% | 12.0%-13.1% | |||||||
Expected exercise factor | 1.36-1.37 | 1.34 – 1.36 | |||||||
Expected dividend yield | 0% | 0% | |||||||
Computation of Basic and Diluted Weighted Average Shares Used in the Earnings Per Share Calculations | ' | ||||||||
The following table sets forth the computation of basic and diluted weighted average shares used in the earnings per share calculations: | |||||||||
Years Ending | |||||||||
September 30, | |||||||||
2013 | 2012 | ||||||||
Denominator for basic earnings per share | |||||||||
- weighted average common shares | 3,932,692 | 3,857,161 | |||||||
Effect of dilutive options and warrants (treasury method) | — | 50,727 | |||||||
Denominator for diluted earnings per share | |||||||||
- adjusted weighted average common shares | 3,932,692 | 3,907,888 | |||||||
Options and warrants outstanding during each year, but not included in the computation of diluted earnings per share because they are antidilutive | 997,045 | 576,863 |
Commitments_Tables
Commitments (Tables) | 12 Months Ended | ||||
Sep. 30, 2013 | |||||
Minimum Lease Payments Under Capital Lease, Including Principal and Interest | ' | ||||
Minimum lease payments, including principal and interest, are summarized in the table below. | |||||
Fiscal Year (in thousands) | Capital | ||||
2014 | $ | 227 | |||
2015 | 121 | ||||
2016 | 46 | ||||
Total payments | 394 | ||||
Less interest | (22 | ) | |||
Total | $ | 372 | |||
Minimum Lease Payments Under Operating Leases | ' | ||||
The following is a schedule by year of future minimum lease payments under operating leases: | |||||
Fiscal Year (in thousands) | Operating | ||||
2014 | $ | 621 | |||
2015 | 632 | ||||
2016 | 648 | ||||
2017 | 664 | ||||
2018 | 681 | ||||
Thereafter | 172 | ||||
Total | $ | 3,418 | |||
Credit_Arrangements_Tables
Credit Arrangements (Tables) | 12 Months Ended | ||||
Sep. 30, 2013 | |||||
Annual Principal Payments on the Term Loans | ' | ||||
The annual principal payments on the term loans were as follows: | |||||
Fiscal Year (in thousands) | |||||
2014 | $ | 634 | |||
2015 | 133 | ||||
Total | $ | 767 | |||
Stock_Options_and_Employee_Sto1
Stock Options and Employee Stock Purchase Plan (Tables) | 12 Months Ended | ||||||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||||||
Schedule of Number of Shares Available for Grant | ' | ||||||||||||||||||||
The number of shares available for grant under these plans at September 30 is as follows: | |||||||||||||||||||||
Qualified | Director | ||||||||||||||||||||
Employee | Stock Option | ||||||||||||||||||||
Stock Option | Plans | ||||||||||||||||||||
Plans | |||||||||||||||||||||
Shares available for grant at September 30, 2011 | 151,883 | 7,000 | |||||||||||||||||||
Stockholder approval to increase shares | 600,000 | 50,000 | |||||||||||||||||||
Options granted | (180,350 | ) | (12,500 | ) | |||||||||||||||||
Options forfeited | 30,393 | — | |||||||||||||||||||
Shares available for grant at September 30, 2012 | 601,926 | 44,500 | |||||||||||||||||||
Options granted | (297,600 | ) | (12,500 | ) | |||||||||||||||||
Options forfeited | 79,803 | 4,000 | |||||||||||||||||||
Shares available for grant at September 30, 2013 | 384,129 | 36,000 | |||||||||||||||||||
Summary of Options Activity | ' | ||||||||||||||||||||
The following table summarizes information with respect to outstanding stock options. | |||||||||||||||||||||
Years Ended September 30, | |||||||||||||||||||||
2013 | 2012 | ||||||||||||||||||||
Options | Weighted | Options | Weighted | ||||||||||||||||||
Average | Average | ||||||||||||||||||||
Exercise | Exercise | ||||||||||||||||||||
Price | Price | ||||||||||||||||||||
Outstanding at beginning of year | 846,280 | $ | 11.28 | 785,547 | $ | 11.52 | |||||||||||||||
Granted | 310,100 | 7.6 | 192,850 | 9.03 | |||||||||||||||||
Exercised | (75,532 | ) | 5.93 | (42,499 | ) | 5.75 | |||||||||||||||
Forfeited | (83,803 | ) | 11.22 | (89,618 | ) | 11.12 | |||||||||||||||
Outstanding at end of year | 997,045 | $ | 10.54 | 846,280 | $ | 11.28 | |||||||||||||||
Exercisable at end of year | 566,440 | 555,135 | |||||||||||||||||||
Weighted average fair value of options granted during the year | $ | 2.57 | $ | 3.45 | |||||||||||||||||
Summary of Options Outstanding Segregated By Range | ' | ||||||||||||||||||||
The options outstanding at September 30, 2013 have been segregated into four ranges for additional disclosure as follows: | |||||||||||||||||||||
Options Outstanding | Options Exercisable | ||||||||||||||||||||
Exercise Prices | Options | Weighted | Weighted | Options | Weighted | ||||||||||||||||
Outstanding at | Average | Average | Exercisable at | Average | |||||||||||||||||
September 30, | Remaining | Exercise | September 30, | Exercise | |||||||||||||||||
2013 | Contractual | Price | 2013 | Price | |||||||||||||||||
Life | |||||||||||||||||||||
$ 4.50 to $9.90 | 678,330 | 7.9 | $ | 7.73 | 281,022 | $ | 7.28 | ||||||||||||||
10.10 to 14.83 | 167,892 | 4.7 | 13.21 | 144,026 | 13.22 | ||||||||||||||||
15.00 to 19.40 | 109,315 | 4.6 | 15.95 | 99,884 | 16.02 | ||||||||||||||||
21.40 to 46.90 | 41,508 | 2.8 | 30.18 | 41,508 | 34.41 | ||||||||||||||||
997,045 | 566,440 | ||||||||||||||||||||
Summary of Non-Vested Shares Activity | ' | ||||||||||||||||||||
A summary of the status of the Company’s non-vested shares at September 30, 2013 and for the year then ended is presented below: | |||||||||||||||||||||
Shares | Weighted Average | ||||||||||||||||||||
Grant Date | |||||||||||||||||||||
Fair Value | |||||||||||||||||||||
Non-vested shares at October 1, 2012 | 291,145 | $ | 4.4 | ||||||||||||||||||
Granted | 310,100 | 2.57 | |||||||||||||||||||
Vested | (129,668 | ) | 3.84 | ||||||||||||||||||
Forfeited | (40,972 | ) | 4.17 | ||||||||||||||||||
Non-vested shares at September 30, 2013 | 430,605 | $ | 3.28 | ||||||||||||||||||
Income_Taxes_Tables
Income Taxes (Tables) | 12 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Provision for Income Taxes | ' | ||||||||
The provision for income taxes consists of the following (in thousands): | |||||||||
Years Ended | |||||||||
September 30, | |||||||||
2013 | 2012 | ||||||||
Current tax benefit | $ | — | $ | — | |||||
Deferred income tax expense | 240 | 240 | |||||||
Provision for income taxes | $ | 240 | $ | 240 | |||||
Reconciliation of Income Tax Expense Computed at U.S Federal Statutory Rate | ' | ||||||||
The reconciliation of income tax expense (benefit) computed at the U.S. federal statutory rate to income tax expense (benefit) is as follows (in thousands): | |||||||||
Years Ended | |||||||||
September 30, | |||||||||
2013 | 2012 | ||||||||
Income tax expense (benefit) at U.S. statutory rate of 34% | $ | (188 | ) | $ | 135 | ||||
Federal income tax refundable research credit | — | — | |||||||
State income tax expense (benefit) | (11 | ) | 105 | ||||||
Permanent differences, net | 111 | 93 | |||||||
Adjustment of temporary differences to income tax returns | (110 | ) | 264 | ||||||
Change in valuation allowance | 438 | (357 | ) | ||||||
Income tax expense | $ | 240 | $ | 240 | |||||
Components of Deferred Tax Accounts Recognized for Financial Purposes | ' | ||||||||
The significant components of the deferred tax accounts recognized for financial reporting purposes are as follows (in thousands): | |||||||||
September 30, | |||||||||
2013 | 2012 | ||||||||
Deferred tax assets: | |||||||||
Net operating loss and other carryforwards | $ | 35,001 | $ | 34,352 | |||||
Common stock warrants | 636 | 519 | |||||||
Allowance for doubtful accounts | 35 | 33 | |||||||
Other | 47 | 175 | |||||||
Total deferred tax assets | 35,719 | 35,079 | |||||||
Deferred tax liabilities: | |||||||||
Fixed assets | (129 | ) | — | ||||||
Other | (321 | ) | (248 | ) | |||||
Total deferred tax liabilities | (450 | ) | (248 | ) | |||||
Net deferred tax asset | 35,269 | 34,831 | |||||||
Valuation allowance | (35,269 | ) | (34,831 | ) | |||||
Goodwill amortization | (2,210 | ) | (1,970 | ) | |||||
Deferred tax liability for goodwill amortization | $ | (2,210 | ) | $ | (1,970 | ) | |||
Equity_in_earnings_from_invest1
Equity in earnings from investment in Mediasite KK (Tables) | 12 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Summary of Equity in Eearnings from Investment in Mediasite KK | ' | ||||||||
The results of operations for Mediasite KK for their year ended June 30 are listed in the table below. | |||||||||
Year ended | Year ended | ||||||||
June 30, 2013 | June 30, 2012 | ||||||||
Revenue | $ | 8,503,000 | $ | 9,050,000 | |||||
Gross margin | 6,181,000 | 6,338,000 | |||||||
Income from operations | 1,381,000 | 2,343,000 | |||||||
Net income | 889,000 | 1,425,000 |
Goodwill_and_Other_Intangible_1
Goodwill and Other Intangible Assets (Tables) | 12 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Summary of Company's Total Intangible Assets | ' | ||||||||||||||||
The following tables present details of the Company’s total intangible assets at September 30, 2013 and 2012: | |||||||||||||||||
(in thousands) | Life | Gross | Accumulated | Balance at | |||||||||||||
(years) | Amortization at | September 30, | |||||||||||||||
September 30, | 2013 | ||||||||||||||||
2013 | |||||||||||||||||
Amortizable: | |||||||||||||||||
Loan origination fees | 3 | $ | 150 | $ | 135 | $ | 15 | ||||||||||
150 | 135 | 15 | |||||||||||||||
Non-amortizable goodwill | 7,576 | — | 7,576 | ||||||||||||||
Total | $ | 7,726 | $ | 135 | $ | 7,591 | |||||||||||
(in thousands) | Life | Gross | Accumulated | Balance at | |||||||||||||
(years) | Amortization at | September 30, | |||||||||||||||
September 30, | 2012 | ||||||||||||||||
2012 | |||||||||||||||||
Amortizable: | |||||||||||||||||
Loan origination fees | 3 | $ | 195 | $ | 180 | $ | 15 | ||||||||||
195 | 180 | 15 | |||||||||||||||
Non-amortizable goodwill | 7,576 | — | 7,576 | ||||||||||||||
Total | $ | 7,771 | $ | 180 | $ | 7,591 | |||||||||||
Segment_Information_Tables
Segment Information (Tables) | 12 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Summary of Revenue by Geographic Region | ' | ||||||||
The following summarizes revenue by geographic region (in thousands): | |||||||||
Years Ended | |||||||||
September 30, | |||||||||
2013 | 2012 | ||||||||
United States | $ | 20,610 | $ | 20,014 | |||||
Europe and Middle East | 3,621 | 3,189 | |||||||
Asia | 1,772 | 1,740 | |||||||
Other | 1,753 | 1,147 | |||||||
Total | $ | 27,756 | $ | 26,090 | |||||
Quarterly_Financial_Data_unaud1
Quarterly Financial Data (unaudited) (Tables) | 12 Months Ended | ||||||||||||||||||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||||||||||||||||||
Quarterly Financial Data Information | ' | ||||||||||||||||||||||||||||||||
The following table sets forth selected quarterly financial information for the years ended September 30, 2013 and 2012. The operating results are not necessarily indicative of results for any future period. | |||||||||||||||||||||||||||||||||
Quarterly Financial Data | |||||||||||||||||||||||||||||||||
(in thousands except per share data) | Q4-’13 | Q3-’13 | Q2-’13 | Q1-’13 | Q4-’12 | Q3-’12 | Q2-’12 | Q1-’12 | |||||||||||||||||||||||||
Revenue | $ | 6,761 | $ | 8,013 | $ | 6,430 | $ | 6,552 | $ | 6,219 | $ | 7,757 | $ | 5,928 | $ | 6,185 | |||||||||||||||||
Gross margin | 4,892 | 5,611 | 4,690 | 4,867 | 4,497 | 5,555 | 4,284 | 4,507 | |||||||||||||||||||||||||
Income (loss) from operations | (582 | ) | 109 | (34 | ) | (131 | ) | (186 | ) | 399 | (32 | ) | (72 | ) | |||||||||||||||||||
Equity in earnings from investment in Mediasite KK | 30 | 11 | 90 | 78 | 170 | 250 | — | — | |||||||||||||||||||||||||
Net income (loss) | (666 | ) | 40 | (27 | ) | (139 | ) | (103 | ) | 559 | (115 | ) | (184 | ) | |||||||||||||||||||
Basic and diluted net income (loss) per share | $ | (0.17 | ) | $ | 0.01 | $ | (0.01 | ) | $ | (0.04 | ) | $ | (0.03 | ) | $ | 0.14 | $ | (0.03 | ) | $ | (0.05 | ) |
Basis_of_Presentation_and_Sign3
Basis of Presentation and Significant Accounting Policies - Additional Information (Detail) (USD $) | 12 Months Ended | |
Sep. 30, 2013 | Sep. 30, 2012 | |
Financial_Institution | ||
Basis of Presentation and Significant Accounting Policies [Line Items] | ' | ' |
Hosting agreement term | '1 year | ' |
Standard product warranty term minimum | '90 days | ' |
Standard product warranty term maximum | '1 year | ' |
Period of hosting contracts to customers | '1 year | ' |
Number of major financial institutions with which cash and cash equivalents are deposited | 2 | ' |
Allowance for doubtful accounts for accounts receivable | $90,000 | $85,000 |
Percentage of product and service of aggregate billing to one distributor | 20.00% | 18.00% |
Percentage of product and service of aggregate billing to second distributor | 22.00% | 25.00% |
Percentage of accounts receivable represented by two distributors | 56.00% | 56.00% |
Percentage of accounts payable represented by two suppliers | 34.00% | 60.00% |
Original maturity of cash and cash equivalents | '3 months | ' |
Credit period of accounts receivable | '30 days | ' |
Estimated economic life of the product | '3 years | ' |
Capitalized internal and external development costs | 533,000 | 0 |
Amortization expense of software development costs | 75,000 | ' |
Equity method investment, ownership percentage | 26.00% | 23.00% |
Earnings from equity method of investment | 209,000 | 420,000 |
Recorded value of equity method of investment, net of foreign currency translation adjustments | 385,000 | 420,000 |
Dividend received from equity method of investment | ' | 22,000 |
Percentage of likelihood | 50.00% | ' |
Impairment loss on goodwill | 0 | 0 |
Advertising Expense | $238,000 | $261,000 |
Percentage of net deferred tax assets recognized due to uncertainty | 100.00% | ' |
Basis_of_Presentation_and_Sign4
Basis of Presentation and Significant Accounting Policies - Inventory (Detail) (USD $) | Sep. 30, 2013 | Sep. 30, 2012 |
In Thousands, unless otherwise specified | ||
Inventory [Line Items] | ' | ' |
Raw materials and supplies | $516 | $216 |
Finished goods | 931 | 837 |
Inventory, Net | $1,447 | $1,053 |
Basis_of_Presentation_and_Sign5
Basis of Presentation and Significant Accounting Policies - Estimated Useful Lives of Property and Equipment (Detail) | 12 Months Ended |
Sep. 30, 2013 | |
Leasehold improvements [Member] | Minimum [Member] | ' |
Property, Plant and Equipment [Line Items] | ' |
Property, Plant and Equipment, Estimated Useful Lives | '5 years |
Leasehold improvements [Member] | Maximum [Member] | ' |
Property, Plant and Equipment [Line Items] | ' |
Property, Plant and Equipment, Estimated Useful Lives | '10 years |
Computer equipment [Member] | Minimum [Member] | ' |
Property, Plant and Equipment [Line Items] | ' |
Property, Plant and Equipment, Estimated Useful Lives | '3 years |
Computer equipment [Member] | Maximum [Member] | ' |
Property, Plant and Equipment [Line Items] | ' |
Property, Plant and Equipment, Estimated Useful Lives | '5 years |
Furniture and fixtures [Member] | Minimum [Member] | ' |
Property, Plant and Equipment [Line Items] | ' |
Property, Plant and Equipment, Estimated Useful Lives | '5 years |
Furniture and fixtures [Member] | Maximum [Member] | ' |
Property, Plant and Equipment [Line Items] | ' |
Property, Plant and Equipment, Estimated Useful Lives | '7 years |
Basis_of_Presentation_and_Sign6
Basis of Presentation and Significant Accounting Policies - Fair Value Assumptions for Stock Options Granted (Detail) | 12 Months Ended | |
Sep. 30, 2013 | Sep. 30, 2012 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' |
Risk- free interest rate | ' | 0.40% |
Expected dividend yield | 0.00% | 0.00% |
Minimum [Member] | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' |
Expected life | '4 years 8 months 12 days | '4 years 8 months 12 days |
Risk- free interest rate | 0.35% | ' |
Expected volatility | 46.80% | 51.40% |
Expected forfeiture rate | 11.80% | 12.00% |
Expected exercise factor | 1.36 | 1.34 |
Maximum [Member] | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' |
Expected life | '4 years 9 months 18 days | '4 years 9 months 18 days |
Risk- free interest rate | 0.61% | ' |
Expected volatility | 49.30% | 64.00% |
Expected forfeiture rate | 13.00% | 13.10% |
Expected exercise factor | 1.37 | 1.36 |
Basis_of_Presentation_and_Sign7
Basis of Presentation and Significant Accounting Policies - Computation of Basic and Diluted Weighted Average Shares Used in the Earnings per Share Calculations (Detail) | 12 Months Ended | |
Sep. 30, 2013 | Sep. 30, 2012 | |
Schedule Of Earnings Per Share Basic And Diluted [Line Items] | ' | ' |
Denominator for basic earnings per share - weighted average common shares | 3,932,692 | 3,857,161 |
Effect of dilutive options and warrants (treasury method) | ' | 50,727 |
Denominator for diluted earnings per share - adjusted weighted average common shares | 3,932,692 | 3,907,888 |
Options and warrants outstanding during each year, but not included in the computation of diluted earnings per share because they are antidilutive | 997,045 | 576,863 |
Commitments_Additional_Informa
Commitments - Additional Information (Detail) (USD $) | 12 Months Ended | ||
Sep. 30, 2013 | Sep. 30, 2012 | Jun. 28, 2011 | |
Commitments [Line Items] | ' | ' | ' |
Portion of leases in fixed assets | $660,000 | ' | ' |
Portion of leases in accumulated depreciation | 184,000 | ' | ' |
Capital lease agreement expiry date | '2016-06 | ' | ' |
Operating lease agreement expiry date | 31-Dec-18 | ' | ' |
Operating leases rent expense | 581,000 | 526,000 | ' |
Lease Term | 'November 2011 through December 2018. | ' | ' |
Leasehold improvement liability | ' | ' | 613,000 |
Unamortized balance of lease | 445,000 | ' | ' |
Purchase which is not recorded on Company's Balance Sheet | $1,100,000 | ' | ' |
Commitments_Minimum_Lease_Paym
Commitments - Minimum Lease Payments Under Capital Lease, Including Principal and Interest (Detail) (USD $) | Sep. 30, 2013 |
In Thousands, unless otherwise specified | |
Commitments [Line Items] | ' |
2014 | $227 |
2015 | 121 |
2016 | 46 |
Total payments | 394 |
Less interest | -22 |
Total | $372 |
Commitments_Minimum_Lease_Paym1
Commitments - Minimum Lease Payments Under Operating Leases (Detail) (USD $) | Sep. 30, 2013 |
In Thousands, unless otherwise specified | |
Schedule Of Capital Leases Future Minimum Payments Payable [Line Items] | ' |
2014 | $621 |
2015 | 632 |
2016 | 648 |
2017 | 664 |
2018 | 681 |
Thereafter | 172 |
Total | $3,418 |
Credit_Arrangements_Additional
Credit Arrangements - Additional Information (Detail) (USD $) | 0 Months Ended | 1 Months Ended | 12 Months Ended | 1 Months Ended | 12 Months Ended | |||||||||
31-May-13 | 31-May-13 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Jun. 27, 2011 | Sep. 30, 2013 | Sep. 30, 2013 | Jun. 27, 2011 | Jun. 27, 2011 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2012 | |
Silicon Valley Bank [Member] | Minimum [Member] | Maximum [Member] | Secured revolving line of credit [Member] | Prior to First Amendment [Member] | Prior to Second Amendment [Member] | Second Amended Agreement [Member] | New term loan [Member] | New term loan [Member] | Term loan [Member] | Term loan [Member] | ||||
Silicon Valley Bank [Member] | Silicon Valley Bank [Member] | |||||||||||||
Line of Credit Facility [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Line of credit facility amount outstanding | ' | ' | ' | ' | ' | ' | $3,000,000 | ' | ' | ' | ' | ' | $767,000 | $1,400,000 |
Adjusted Quick Ratio as above Silicon Valley Bank's prime rate | ' | ' | ' | 1.00% | ' | ' | ' | 1.00% | 1.50% | ' | ' | ' | ' | ' |
Description of adjusted quick ratio | ' | ' | ' | ' | ' | ' | ' | ' | ' | 'Greater than 2.0 to 1.0 | ' | ' | ' | ' |
Percentage of advance rate on domestic receivables | ' | ' | ' | ' | 75.00% | 80.00% | ' | ' | ' | ' | ' | ' | ' | ' |
Adjusted Quick Ratio as percentage | ' | ' | ' | 8.75% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total term loan | ' | ' | 2,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total term debt | ' | ' | 2,400,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Interest will accrue on the revolving line of credit | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 3.75% | ' | ' |
Interest will accrue on the revolving line of credit if the company maintains an Adjusted Quick Ratio of greater than 2.0 to 1.0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 3.25% | ' | ' |
Amortization period of term loan | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '36 months | ' | ' |
Debt Service Coverage Ratio | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1.25 | ' | ' | ' |
Adjusted Quick Ratio | ' | ' | 2 | ' | ' | ' | ' | ' | ' | ' | 1.75 | ' | ' | ' |
Maximum Drawing period of term loan | ' | ' | '10 months | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revolving Loan Maturity Date | ' | 1-Oct-13 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revolving Loan Maturity Date | ' | 1-Oct-15 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Interest Rate on revolving line of credit for three quarters | ' | ' | 0.75% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Restriction to repurchase of common stock | ' | ' | 1,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Interest Rate on Unused Revolving Loan facility | ' | ' | 0.18% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Authorized common stock repurchase program | 1,000,000 | ' | 1,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Shares Repurchased | ' | ' | 0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Effective interest rate | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 6.50% | ' |
Credit facility for advances | ' | ' | $2,200,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Credit_Arrangements_Summary_of
Credit Arrangements - Summary of Annual Principal Payments on Term Loans (Detail) (USD $) | Sep. 30, 2013 |
In Thousands, unless otherwise specified | |
Debt Instrument [Line Items] | ' |
2014 | $634 |
2015 | 133 |
Total | $767 |
Common_Stock_Warrants_Addition
Common Stock Warrants - Additional Information (Detail) | Sep. 30, 2013 |
Class of Warrant or Right [Line Items] | ' |
Number of warrants outstanding | 0 |
Stock_Options_and_Employee_Sto2
Stock Options and Employee Stock Purchase Plan - Additional Information (Detail) (USD $) | 12 Months Ended | |||
Sep. 30, 2013 | Sep. 30, 2012 | Mar. 31, 2011 | Mar. 05, 2009 | |
Employee Stock Purchase Plan [Line Items] | ' | ' | ' | ' |
Number of shares that holder entitles to purchase at specified option price | 1 | ' | ' | ' |
Duration of termination for stock plan | '10 years | ' | ' | ' |
Unrecognized non vested stock based compensation | $297,000 | ' | ' | ' |
Estimated forfeitures for unrecognized non vested stock based compensation | 75,000 | ' | ' | ' |
Expected weighted average life of forfeited cost | '1 year 10 months 24 days | ' | ' | ' |
Share-based Compensation | 656,000 | 742,000 | ' | ' |
Proceeds and Excess Tax Benefit from Share-based Compensation | 448,000 | 245,000 | ' | ' |
Tax benefits realized for tax deductions from option exercises | 0 | 0 | ' | ' |
Cash received from issuance of stock under purchase plan | 75,000 | 134,000 | ' | ' |
Selling and marketing expenses [Member] | ' | ' | ' | ' |
Employee Stock Purchase Plan [Line Items] | ' | ' | ' | ' |
Share-based Compensation | 429,000 | 485,000 | ' | ' |
General and administrative expenses [Member] | ' | ' | ' | ' |
Employee Stock Purchase Plan [Line Items] | ' | ' | ' | ' |
Share-based Compensation | 40,000 | 43,000 | ' | ' |
Product development expenses [Member] | ' | ' | ' | ' |
Employee Stock Purchase Plan [Line Items] | ' | ' | ' | ' |
Share-based Compensation | 187,000 | 214,000 | ' | ' |
Director Stock Option Plans [Member] | ' | ' | ' | ' |
Employee Stock Purchase Plan [Line Items] | ' | ' | ' | ' |
Directors stock option plan increase in purchased limit | 50,000 | ' | ' | ' |
Qualified Employee Stock Option Plans [Member] | ' | ' | ' | ' |
Employee Stock Purchase Plan [Line Items] | ' | ' | ' | ' |
Employee stock purchase plan increase in number of shares | 600,000 | ' | ' | ' |
Employee Stock Purchase Plan [Member] | ' | ' | ' | ' |
Employee Stock Purchase Plan [Line Items] | ' | ' | ' | ' |
Expected shares issued | 100,000 | ' | ' | 100,000 |
Number of shares to be granted on each meeting under directors plan | ' | ' | ' | 2,000 |
Share-based Compensation | 19,000 | 26,000 | ' | ' |
Increase in number of shares under the plan | ' | ' | 50,000 | ' |
Number of complete employment days on first day of each offering period | '90 days | ' | ' | ' |
Employee not eligible to participate | 5.00% | ' | ' | ' |
Eligible employees contribution to purchase price | 10.00% | ' | ' | ' |
Restricted participant under purchase plan that exceeds the rate of the fair value of shares | 25,000 | ' | ' | ' |
Restricted participant under purchase plan that exceeds the number of shares | 1,000 | ' | ' | ' |
Purchase shares of common stock at a purchase price fair market | 85.00% | ' | ' | ' |
Shares available to issue | 14,346 | ' | ' | ' |
Shares purchase by employees | 15,062 | 21,010 | ' | ' |
Cash received from issuance of stock under purchase plan | $75,000 | $134,000 | ' | ' |
Employee Stock Purchase Plan [Member] | Maximum [Member] | ' | ' | ' | ' |
Employee Stock Purchase Plan [Line Items] | ' | ' | ' | ' |
Increase in number of shares under the plan | ' | ' | 100,000 | ' |
Stock_Options_and_Employee_Sto3
Stock Options and Employee Stock Purchase Plan - Schedule of Number of Shares Available for Grant (Detail) | 12 Months Ended | |
Sep. 30, 2013 | Sep. 30, 2012 | |
Employee Stock Purchase Plan [Line Items] | ' | ' |
Outstanding at beginning of year | 846,280 | 785,547 |
Options granted | -310,100 | -192,850 |
Options forfeited | 83,803 | 89,618 |
Outstanding at end of year | 997,045 | 846,280 |
Qualified Employee Stock Option Plans [Member] | ' | ' |
Employee Stock Purchase Plan [Line Items] | ' | ' |
Outstanding at beginning of year | 601,926 | 151,883 |
Stockholder approval to increase shares | ' | 600,000 |
Options granted | -297,600 | -180,350 |
Options forfeited | 79,803 | 30,393 |
Outstanding at end of year | 384,129 | 601,926 |
Director Stock Option Plans [Member] | ' | ' |
Employee Stock Purchase Plan [Line Items] | ' | ' |
Outstanding at beginning of year | 44,500 | 7,000 |
Stockholder approval to increase shares | ' | 50,000 |
Options granted | -12,500 | -12,500 |
Options forfeited | 4,000 | ' |
Outstanding at end of year | 36,000 | 44,500 |
Stock_Options_and_Employee_Sto4
Stock Options and Employee Stock Purchase Plan - Summary of Options Activity (Detail) (USD $) | 12 Months Ended | |
Sep. 30, 2013 | Sep. 30, 2012 | |
Schedule Of Stock Options [Line Items] | ' | ' |
Weighted average fair value of options granted during the year | $2.57 | $3.45 |
Outstanding at beginning of year | 846,280 | 785,547 |
Options granted | 310,100 | 192,850 |
Options Exercised | -75,532 | -42,499 |
Options forfeited | -83,803 | -89,618 |
Outstanding at end of year | 997,045 | 846,280 |
Exercisable at end of year | 566,440 | 555,135 |
Outstanding at beginning of year, Weighted average exercise price | $11.28 | $11.52 |
Weighted average exercise price, Granted | $7.60 | $9.03 |
Weighted average exercise price, Exercised | $5.93 | $5.75 |
Weighted average exercise price, Forfeited | $11.22 | $11.12 |
Outstanding at end of year, Weighted average exercise price | $10.54 | $11.28 |
Stock_Options_and_Employee_Sto5
Stock Options and Employee Stock Purchase Plan - Summary of Options Outstanding Segregated By Range (Detail) (USD $) | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2011 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 |
Range I [Member] | Range II [Member] | Range III [Member] | Range IV [Member] | ||||
Share Based Compensation Arrangement By Share Based Payment Award Options Outstanding [Line Items] | ' | ' | ' | ' | ' | ' | ' |
Outstanding Options, Weighted Average Exercise Price | $10.54 | $11.28 | $11.52 | $7.73 | $13.21 | $15.95 | $30.18 |
Options Exercisable, Weighted Average Exercise Price | ' | ' | ' | $7.28 | $13.22 | $16.02 | $34.41 |
Option Outstanding, Weighted Average Remaining Contractual Life | ' | ' | ' | '7 years 10 months 24 days | '4 years 8 months 12 days | '4 years 7 months 6 days | '2 years 9 months 18 days |
Option Outstanding at September 30, 2013 | 997,045 | 846,280 | 785,547 | 678,330 | 167,892 | 109,315 | 41,508 |
Options Exercisable at September 30, 2013 | 566,440 | 555,135 | ' | 281,022 | 144,026 | 99,884 | 41,508 |
Exercise Price, Lower range | ' | ' | ' | $4.50 | $10.10 | $15 | $21.40 |
Exercise Price, Upper range | ' | ' | ' | $9.90 | $14.83 | $19.40 | $46.90 |
Stock_Options_and_Employee_Sto6
Stock Options and Employee Stock Purchase Plan - Summary of Non-Vested Shares Activity (Detail) (USD $) | 12 Months Ended |
Sep. 30, 2013 | |
Nonvested Share Activity [Line Items] | ' |
Non-vested shares, Weighted Average Grant Date Fair Value at October 1, 2012 | $4.40 |
Granted, Weighted-Average Grant Date Fair Value | $2.57 |
Vested, Weighted Average Grant Date Fair Value | $3.84 |
Forfeited, Weighted Average Grant Date Fair Value | $4.17 |
Non-vested shares, Weighted Average Grant Date Fair Value at September 30, 2013 | $3.28 |
Non-vested shares at October 1, 2012 | 291,145 |
Granted, Shares | 310,100 |
Vested, Shares | -129,668 |
Forfeited, Shares | -40,972 |
Non-vested shares at September 30, 2013 | 430,605 |
Income_Taxes_Provision_for_Inc
Income Taxes - Provision for Income Taxes (Detail) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 |
Schedule Of Income Taxes [Line Items] | ' | ' |
Current tax benefit | ' | ' |
Deferred income tax expense | 240 | 240 |
Provision for income taxes | $240 | $240 |
Income_Taxes_Reconciliation_of
Income Taxes - Reconciliation of Income Tax Expense Computed at U.S Federal Statutory Rate (Detail) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 |
Reconciliation Of Income Taxes [Line Items] | ' | ' |
Income tax expense (benefit) at U.S. statutory rate of 34% | ($188) | $135 |
Federal income tax refundable research credit | ' | ' |
State income tax expense (benefit) | -11 | 105 |
Permanent differences, net | 111 | 93 |
Adjustment of temporary differences to income tax returns | -110 | 264 |
Change in valuation allowance | 438 | -357 |
Income tax expense | $240 | $240 |
Income_Taxes_Components_of_Def
Income Taxes - Components of Deferred Tax Accounts Recognized for Financial Purposes (Detail) (USD $) | Sep. 30, 2013 | Sep. 30, 2012 |
In Thousands, unless otherwise specified | ||
Deferred Tax Assets And Liabilities Classification [Line Items] | ' | ' |
Net operating loss and other carryforwards | $35,001 | $34,352 |
Common stock warrants | 636 | 519 |
Allowance for doubtful accounts | 35 | 33 |
Other | 47 | 175 |
Total deferred tax assets | 35,719 | 35,079 |
Deferred tax liabilities: | ' | ' |
Fixed assets | -129 | ' |
Other | -321 | -248 |
Total deferred tax liabilities | -450 | -248 |
Net deferred tax asset | 35,269 | 34,831 |
Valuation allowance | -35,269 | -34,831 |
Goodwill amortization | -2,210 | -1,970 |
Deferred tax liability for goodwill amortization | ($2,210) | ($1,970) |
Income_Taxes_Additional_Inform
Income Taxes - Additional Information (Detail) (USD $) | 12 Months Ended | |
Sep. 30, 2013 | Sep. 30, 2012 | |
Schedule Of Income Taxes [Line Items] | ' | ' |
Research and Development tax credit carryforwards | $500,000 | ' |
Percentage of net deferred tax assets recognized due to uncertainty | 100.00% | ' |
Goodwill for tax purposes amortization period | '15 years | ' |
Deferred tax liability | 2,210,000 | 1,970,000 |
Accruals of interest and penalties | 0 | 0 |
Federal Tax [Member] | ' | ' |
Schedule Of Income Taxes [Line Items] | ' | ' |
Operating Loss Carryforwards | 89,000,000 | ' |
Federal Tax [Member] | Minimum [Member] | ' | ' |
Schedule Of Income Taxes [Line Items] | ' | ' |
Operating loss carryforwards for federal tax purposes | '2019 | ' |
Federal Tax [Member] | Maximum [Member] | ' | ' |
Schedule Of Income Taxes [Line Items] | ' | ' |
Operating loss carryforwards for federal tax purposes | '2033 | ' |
State tax [Member] | ' | ' |
Schedule Of Income Taxes [Line Items] | ' | ' |
Operating Loss Carryforwards | $51,000,000 | ' |
State tax [Member] | Minimum [Member] | ' | ' |
Schedule Of Income Taxes [Line Items] | ' | ' |
Operating loss carryforwards for federal tax purposes | '2014 | ' |
State tax [Member] | Maximum [Member] | ' | ' |
Schedule Of Income Taxes [Line Items] | ' | ' |
Operating loss carryforwards for federal tax purposes | '2032 | ' |
Research Tax Credit Carryforward [Member] | Minimum [Member] | ' | ' |
Schedule Of Income Taxes [Line Items] | ' | ' |
Research and Development tax credit carryforwards expire date | '2017 | ' |
Research Tax Credit Carryforward [Member] | Maximum [Member] | ' | ' |
Schedule Of Income Taxes [Line Items] | ' | ' |
Research and Development tax credit carryforwards expire date | '2020 | ' |
Stock_Repurchase_Program_Addit
Stock Repurchase Program - Additional Information (Detail) (USD $) | 0 Months Ended | 12 Months Ended |
In Millions, except Share data, unless otherwise specified | 31-May-13 | Sep. 30, 2013 |
Share Repurchase Program [Line Items] | ' | ' |
Common stock repurchase program, authorized amount | $1 | $1 |
Shares Repurchased | ' | 0 |
Savings_Plan_Additional_Inform
Savings Plan - Additional Information (Detail) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 |
Defined Benefit Plan Disclosure [Line Items] | ' | ' |
Defined savings plan contributions | $275 | $316 |
Additional discretionary contributions | $0 | $0 |
RelatedParty_Transactions_Addi
Related-Party Transactions - Additional Information (Detail) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 |
Related Party Transaction [Line Items] | ' | ' |
Company incurred fees to law firm | $171 | $186 |
Accrued liabilities for unbilled services | 14 | 30 |
Outstanding loan amount | 26 | 26 |
Mediasite KK [Member] | ' | ' |
Related Party Transaction [Line Items] | ' | ' |
Mediasite product and customer support billings | 1,300 | 1,000 |
Mediasite KK owed the company | $280 | $240 |
Equity_in_earnings_from_invest2
Equity in earnings from investment in Mediasite KK - Schedule of Equity in Earnings from Investment in Mediasite KK (Detail) (USD $) | 9 Months Ended | |
Jun. 30, 2013 | Jun. 30, 2012 | |
Schedule Of Results Related To Equity Accounted Investees [Line Items] | ' | ' |
Revenue | $8,503,000 | $9,050,000 |
Gross margin | 6,181,000 | 6,338,000 |
Income from operations | 1,381,000 | 2,343,000 |
Net income | $889,000 | $1,425,000 |
Equity_in_earnings_from_invest3
Equity in earnings from investment in Mediasite KK - Additional Information (Detail) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 |
Schedule Of Results Related To Equity Accounted Investees [Line Items] | ' | ' |
Equity method investment ownership percentage | 26.00% | 23.00% |
Equity in earnings | $209 | $420 |
Equity method investment, Dividend | ' | 22 |
Mediasite KK [Member] | ' | ' |
Schedule Of Results Related To Equity Accounted Investees [Line Items] | ' | ' |
Equity method investment ownership percentage | 26.00% | 23.00% |
Equity in earnings | 209 | 420 |
Value of investment, net of foreign currency translation adjustment | 385 | 420 |
Equity method investment, Dividend | $22 | ' |
Goodwill_and_Other_Intangible_2
Goodwill and Other Intangible Assets - Total Intangible Assets (Detail) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 |
Goodwill [Line Items] | ' | ' |
Finite-Lived Intangible Asset, Useful Life | '3 years | '3 years |
Loan origination fees, Gross | $150 | $195 |
Loan origination fees, Gross | 150 | 195 |
Non-amortizable goodwill, Gross | 7,576 | 7,576 |
Total Intangible assets, Gross | 7,726 | 7,771 |
Loan origination fees, Accumulated amortization | 135 | 180 |
Loan origination fees, Accumulated amortization | 135 | 180 |
Loan origination fees, Accumulated amortization | 135 | 180 |
Loan origination fees, Net | 15 | 15 |
Loan origination fees, Net | 15 | 15 |
Non-amortizable goodwill | 7,576 | 7,576 |
Total Intangible assets | $7,591 | $7,591 |
Segment_Information_Additional
Segment Information - Additional Information (Detail) | 12 Months Ended |
Sep. 30, 2013 | |
Segment | |
Segment Reporting Disclosure [Line Items] | ' |
Number of operating segments | 1 |
Segment_Information_Summarizes
Segment Information - Summarizes Revenue by Geographic Region (Detail) (USD $) | 3 Months Ended | 12 Months Ended | ||||||||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2011 | Sep. 30, 2013 | Sep. 30, 2012 |
Segment Information [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revenues | $6,761 | $8,013 | $6,430 | $6,552 | $6,219 | $7,757 | $5,928 | $6,185 | $27,756 | $26,090 |
United States [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Segment Information [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revenues | ' | ' | ' | ' | ' | ' | ' | ' | 20,610 | 20,014 |
Europe And Middle East [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Segment Information [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revenues | ' | ' | ' | ' | ' | ' | ' | ' | 3,621 | 3,189 |
Asia [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Segment Information [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revenues | ' | ' | ' | ' | ' | ' | ' | ' | 1,772 | 1,740 |
Other [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Segment Information [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revenues | ' | ' | ' | ' | ' | ' | ' | ' | $1,753 | $1,147 |
Customer_Concentration_Additio
Customer Concentration - Additional Information (Detail) | 12 Months Ended | |
Sep. 30, 2013 | Sep. 30, 2012 | |
Concentration Risk [Line Items] | ' | ' |
Percentage of revenue represented by two distributors | 42.00% | 43.00% |
Percentage of account receivables represented by two distributors | 56.00% | 56.00% |
Quarterly_Financial_Data_Quart
Quarterly Financial Data - Quarterly Financial Data Information (Detail) (USD $) | 3 Months Ended | 12 Months Ended | ||||||||
In Thousands, except Per Share data, unless otherwise specified | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2011 | Sep. 30, 2013 | Sep. 30, 2012 |
Quarterly Financial Data [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revenue | $6,761 | $8,013 | $6,430 | $6,552 | $6,219 | $7,757 | $5,928 | $6,185 | $27,756 | $26,090 |
Gross margin | 4,892 | 5,611 | 4,690 | 4,867 | 4,497 | 5,555 | 4,284 | 4,507 | 20,060 | 18,844 |
Income (loss) from operations | -582 | 109 | -34 | -131 | -186 | 399 | -32 | -72 | -638 | 109 |
Equity in earnings from investment in Mediasite KK | 30 | 11 | 90 | 78 | 170 | 250 | ' | ' | ' | ' |
Net income (loss) | ($666) | $40 | ($27) | ($139) | ($103) | $559 | ($115) | ($184) | ($792) | $157 |
Basic and diluted net income (loss) per share | ($0.17) | $0.01 | ($0.01) | ($0.04) | ($0.03) | $0.14 | ($0.03) | ($0.05) | ' | ' |
Subsequent_Events_Additional_I
Subsequent Events - Additional Information (Detail) (Subsequent Event [Member]) | 0 Months Ended | |||
Nov. 19, 2013 | Nov. 19, 2013 | Dec. 16, 2013 | Dec. 16, 2013 | |
Mediasite KK [Member] | Mediasite KK [Member] | Media Mission [Member] | Media Mission [Member] | |
USD ($) | JPY (¥) | USD ($) | EUR (€) | |
Subsequent Event [Line Items] | ' | ' | ' | ' |
Business acquisition, cash paid for additional interest in subsidiary | $5,850,000 | ¥ 585,000,000 | ' | ' |
Business acquisition, cash paid | 1,950,000 | ' | 453,000 | 330,000 |
Interest rate payable on subordinate note | 6.50% | 6.50% | 6.50% | 6.50% |
Business acquisition, purchase price | ' | ' | ' | 1,100,000 |
Business acquisition, subordinated note payable | ' | ' | 680,000 | 495,000 |
Business acquisition, number of shares issued | ' | ' | 37,608 | 37,608 |
Business acquisition, value of shares issued | ' | ' | $373,000 | € 2,750,000 |
Business acquisition, price per share | ' | ' | $9.92 | ' |