Document And Entity Information
Document And Entity Information - shares | 6 Months Ended | |
Jun. 30, 2023 | Aug. 07, 2023 | |
Document Information Line Items | ||
Entity Registrant Name | SILVERSUN TECHNOLOGIES, INC. | |
Trading Symbol | SSNT | |
Document Type | 10-Q | |
Current Fiscal Year End Date | --12-31 | |
Entity Common Stock, Shares Outstanding | 5,256,177 | |
Amendment Flag | false | |
Entity Central Index Key | 0001236275 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Document Period End Date | Jun. 30, 2023 | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q2 | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Entity File Number | 001-38063 | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 16-1633636 | |
Entity Address, Address Line One | 120 Eagle Rock Ave | |
Entity Address, City or Town | East Hanover | |
Entity Address, State or Province | NJ | |
Entity Address, Postal Zip Code | 07936 | |
City Area Code | 973 | |
Local Phone Number | 396-1720 | |
Title of 12(g) Security | Common Stock, par value $0.00001 per share | |
Security Exchange Name | NASDAQ | |
Entity Interactive Data Current | Yes |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) | Jun. 30, 2023 | Dec. 31, 2022 |
Current assets: | ||
Cash and cash equivalents | $ 7,129,782 | $ 8,008,633 |
Accounts receivable, net of allowance of $422,671 and $490,311 as of June 30, 2023 and December 31, 2022, respectively | 2,227,541 | 2,232,960 |
Unbilled services | 501,254 | 367,165 |
Deferred charges | 2,033,774 | 1,516,895 |
Prepaid expenses and other current assets | 1,534,037 | 1,573,615 |
Total current assets | 13,426,388 | 13,699,268 |
Property and equipment, net | 557,104 | 711,314 |
Operating lease right-of-use assets | 465,042 | 328,562 |
Intangible assets, net | 3,941,431 | 4,265,353 |
Goodwill | 1,139,952 | 1,139,952 |
Deferred tax assets | 885,719 | 1,106,065 |
Deposits and other assets | 187,553 | 187,553 |
Total assets | 20,603,189 | 21,438,067 |
Current liabilities: | ||
Accounts payable | 2,820,595 | 3,272,555 |
Accrued expenses | 2,175,225 | 2,432,703 |
Accrued interest | 24,129 | 23,757 |
Long-term debt – current portion | 477,069 | 680,146 |
Long-term debt – related party – current portion | 103,333 | 103,333 |
Finance lease obligations – current portion | 202,420 | 214,990 |
Operating lease liabilities – current portion | 302,739 | 268,345 |
Deferred revenue | 3,363,654 | 3,757,090 |
Total current liabilities | 9,469,164 | 10,752,919 |
Long-term debt net of current portion | 451,674 | 671,014 |
Finance lease obligations net of current portion | 305,235 | 401,453 |
Operating lease liabilities net of current portion | 162,303 | 60,217 |
Total liabilities | 10,388,376 | 11,885,603 |
Commitments and contingencies | ||
Stockholders’ equity: | ||
Preferred stock, value | ||
Common stock, value | 53 | 53 |
Additional paid-in capital | 10,470,498 | 10,429,001 |
Accumulated deficit | (255,738) | (876,590) |
Total stockholders’ equity | 10,214,813 | 9,552,464 |
Total liabilities and stockholders’ equity | 20,603,189 | 21,438,067 |
Series A Preferred Stock [Member] | ||
Stockholders’ equity: | ||
Preferred stock, value | $ 0 | $ 0 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parentheticals) - USD ($) | Jun. 30, 2023 | Dec. 31, 2022 |
Accounts receivable, allowance (in Dollars) | $ 422,671 | $ 490,311 |
Preferred stock, par value (in Dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 1,000,000 | 1,000,000 |
Preferred stock, value | 0 | 0 |
Preferred stock, value | 0 | 0 |
Par value (in Dollars per share) | $ 0.00001 | $ 0.00001 |
Authorized | 75,000,000 | 75,000,000 |
Issued | 5,256,177 | 5,256,177 |
Outstanding | 5,256,177 | 5,256,177 |
Series A Preferred Stock [Member] | ||
Preferred stock, shares authorized | 2 | 2 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Revenues: | ||||
Revenues | $ 13,257,271 | $ 10,638,073 | $ 26,385,009 | $ 21,661,917 |
Cost of revenues: | ||||
Cost of revenues | 8,072,126 | 6,510,805 | 15,842,304 | 12,829,782 |
Gross profit | 5,185,145 | 4,127,268 | 10,542,705 | 8,832,135 |
Selling, general and administrative expenses: | ||||
Selling and marketing expenses | 2,141,468 | 1,852,903 | 4,320,171 | 3,628,714 |
General and administrative expenses | 2,383,784 | 2,071,145 | 4,943,812 | 4,712,122 |
Share-based compensation expenses | 0 | 45,945 | 41,497 | 91,890 |
Depreciation and amortization expenses | 203,629 | 236,521 | 411,424 | 498,371 |
Total selling, general and administrative expenses | 4,728,881 | 4,206,514 | 9,716,904 | 8,931,097 |
Income (loss) from operations | 456,264 | (79,246) | 825,801 | (98,962) |
Other expense: | ||||
Interest expense | (17,422) | (23,800) | (34,677) | (42,652) |
Total other expense | (17,422) | (23,800) | (34,677) | (42,652) |
Income (loss) before taxes | 438,842 | (103,046) | 791,124 | (141,614) |
Provision (benefit) for income taxes | 95,481 | (15,280) | 170,272 | (13,192) |
Net income (loss) | $ 343,361 | $ (87,766) | $ 620,852 | $ (128,422) |
Basic (in Dollars per share) | $ 0.07 | $ (0.02) | $ 0.12 | $ (0.03) |
Diluted (in Dollars per share) | $ 0.07 | $ (0.02) | $ 0.12 | $ (0.03) |
Weighted average shares: | ||||
Basic (in Shares) | 5,256,177 | 5,136,177 | 5,256,177 | 5,136,177 |
Diluted (in Shares) | 5,256,177 | 5,136,177 | 5,256,177 | 5,136,177 |
Product [Member] | ||||
Revenues: | ||||
Revenues | $ 3,298,020 | $ 2,782,081 | $ 6,620,349 | $ 5,393,043 |
Cost of revenues: | ||||
Cost of revenues | 2,027,461 | 1,686,273 | 3,959,736 | 3,210,852 |
Service Net [Member] | ||||
Revenues: | ||||
Revenues | 9,959,251 | 7,855,992 | 19,764,660 | 16,268,874 |
Cost of revenues: | ||||
Cost of revenues | $ 6,044,665 | $ 4,824,532 | $ 11,882,568 | $ 9,618,930 |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) | Common Stock [Member] | Additional Paid-in Capital [Member] | Retained Earnings [Member] | Total |
Balance at Dec. 31, 2021 | $ 52 | $ 9,951,142 | $ (594,371) | $ 9,356,823 |
Balance (in Shares) at Dec. 31, 2021 | 5,136,177 | |||
Share-based compensation | 91,890 | 91,890 | ||
Net income (loss) | (128,422) | (128,422) | ||
Balance at Jun. 30, 2022 | $ 52 | 10,043,032 | (722,793) | 9,320,291 |
Balance (in Shares) at Jun. 30, 2022 | 5,136,177 | |||
Balance at Mar. 31, 2022 | $ 52 | 9,997,087 | (635,027) | 9,362,112 |
Balance (in Shares) at Mar. 31, 2022 | 5,136,177 | |||
Share-based compensation | 45,945 | 45,945 | ||
Net income (loss) | (87,766) | (87,766) | ||
Balance at Jun. 30, 2022 | $ 52 | 10,043,032 | (722,793) | 9,320,291 |
Balance (in Shares) at Jun. 30, 2022 | 5,136,177 | |||
Balance at Dec. 31, 2022 | $ 53 | 10,429,001 | (876,590) | 9,552,464 |
Balance (in Shares) at Dec. 31, 2022 | 5,256,177 | |||
Share-based compensation | 41,497 | 41,497 | ||
Net income (loss) | 620,852 | 620,852 | ||
Balance at Jun. 30, 2023 | $ 53 | 10,470,498 | (255,738) | 10,214,813 |
Balance (in Shares) at Jun. 30, 2023 | 5,256,177 | |||
Balance at Mar. 31, 2023 | $ 53 | 10,470,498 | (599,099) | 9,871,452 |
Balance (in Shares) at Mar. 31, 2023 | 5,256,177 | |||
Net income (loss) | 343,361 | 343,361 | ||
Balance at Jun. 30, 2023 | $ 53 | $ 10,470,498 | $ (255,738) | $ 10,214,813 |
Balance (in Shares) at Jun. 30, 2023 | 5,256,177 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 3 Months Ended | 6 Months Ended | 12 Months Ended | |||
Jan. 01, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | Dec. 31, 2022 | |
Cash flows from operating activities: | ||||||
Net income (loss) | $ 620,852 | $ (128,422) | ||||
Adjustments to reconcile net income (loss) to net cash used in operating activities: | ||||||
Deferred income taxes | 220,346 | (13,192) | ||||
Depreciation and amortization | $ 85,529 | $ 96,582 | 178,070 | 195,007 | ||
Amortization of intangibles | 161,961 | 186,365 | 323,922 | 376,822 | ||
Amortization of right of use assets | 188,161 | 453,009 | ||||
Bad debt expense | (67,640) | 0 | ||||
Share-based compensation | 45,945 | 41,497 | 91,890 | |||
Changes in assets and liabilities: | ||||||
Accounts receivable | 73,059 | (319,307) | ||||
Unbilled services | (134,089) | (60,864) | ||||
Deferred charges | (516,879) | 0 | ||||
Prepaid expenses and other current assets | 39,578 | (227,664) | ||||
Deposits and other assets | 0 | 1,942 | ||||
Accounts payable | (451,960) | (95,350) | ||||
Accrued expenses | (257,478) | (303,852) | ||||
Accrued interest | 372 | (5,405) | ||||
Deferred revenues | (393,436) | 3,087 | ||||
Operating lease obligations | (188,161) | (453,009) | ||||
Net cash used in operating activities | (323,786) | (485,308) | ||||
Cash flows from investing activities: | ||||||
Purchase of property and equipment | (23,860) | (30,549) | ||||
Acquisition of assets | $ (500,000) | 0 | (150,000) | |||
Net cash used in investing activities | (23,860) | (180,549) | ||||
Cash flows from financing activities: | ||||||
Payment of long-term debt | (422,417) | (161,240) | ||||
Payment of finance lease obligations | (108,788) | (113,346) | ||||
Net cash used in financing activities | (531,205) | (274,586) | ||||
Net decrease in cash | (878,851) | (940,443) | ||||
Cash, beginning of period | $ 6,814,117 | 8,008,633 | 6,814,117 | $ 6,814,117 | ||
Cash, end of period | $ 7,129,782 | $ 5,873,674 | 7,129,782 | 5,873,674 | $ 8,008,633 | |
Cash paid during period for: | ||||||
Interest | 58,248 | 48,147 | ||||
Income taxes | $ 23,479 | $ 15,820 |
SUPPLEMENTAL SCHEDULE OF NON-CA
SUPPLEMENTAL SCHEDULE OF NON-CASH INVESTING AND FINANCING ACTIVITIES | 6 Months Ended |
Jun. 30, 2023 | |
Supplemental Cash Flow Elements [Abstract] | |
Cash Flow, Supplemental Disclosures [Text Block] | SUPPLEMENTAL SCHEDULE OF NON-CASH INVESTING AND FINANCING ACTIVITIES For the six months ended June 30, 2023: On September 29, 2022, the Company entered into an operating lease for equipment with Digital Fortress, Inc. Accordingly, operating lease right of use assets and operating lease liabilities were recognized in the amount of $109,840. On October 12, 2022, the Company entered into an operating lease for equipment and space with Cologix USA, Inc. Accordingly, operating lease right of use assets and operating lease liabilities were recognized in the amount of $106,471. On June 2, 2023, the Company entered into an operating lease to extend its lease for its Arizona office with Exeter 17319 DE, LLC. Accordingly, operating lease right of use assets and operating lease liabilities were recognized in the amount of $108,330 during the period ended June 30, 2023. For the six months ended June 30, 2022: On January 1, 2022, the Company entered into an asset purchase agreement with Dynamic Tech Services, Inc (“DTS”) to acquire certain assets of DTS. The purchase price for the Acquired Assets was $1,335,000, $500,000 of which was paid in cash in December 2021 and $835,000 of which was paid through the issuance of a four-year $835,000 promissory note dated January 1, 2022, paying interest at the rate of 3.25% per annum (see Note 11). On January 22, 2022, the Company entered into an agreement to acquire certain assets of NEO3, LLC (“NEO3”). The purchase price for the customer list was $225,000, $150,000 of which was paid in cash and $75,000 of which was paid through the issuance of a three-year $75,000 promissory note dated January 22, 2022, paying interest at the rate of 2% per annum. The Company also assumed $73,672 of prepaid time as part of the consideration for this transaction. On April 15, 2022, the Company incurred approximately $494,383 in financial lease obligations for purchases of equipment. |
DESCRIPTION OF BUSINESS
DESCRIPTION OF BUSINESS | 6 Months Ended |
Jun. 30, 2023 | |
Accounting Policies [Abstract] | |
Organization, Consolidation and Presentation of Financial Statements Disclosure [Text Block] | NOTE 1 DESCRIPTION OF BUSINESS SilverSun Technologies, Inc. (“SilverSun”) through our wholly owned subsidiaries SWK Technologies, Inc. (“SWK”), Secure Cloud Services, Inc. (“SCS”) and Critical Cyber Defense Corp. (“CCD”) (together with SWK, SCS and SilverSun, the “Company”) is a business application, technology and consulting company providing strategies and solutions to meet our clients’ information, technology and business management needs. Our services and technologies enable customers to manage, protect and monetize their enterprise assets whether on-premises or in the “Cloud”. As a value-added reseller of business application software, we offer solutions for accounting and business management, financial reporting, Enterprise Resource Planning (“ERP”), Human Capital Management (“HCM”), Warehouse Management Systems (“WMS”), Customer Relationship Management (“CRM”), and Business Intelligence (“BI”). Additionally, we have our own development staff building software solutions for time and billing, and various ERP enhancements. Our value-added services focus on consulting and professional services, specialized programming, training, and technical support. We have a dedicated network services practice that provides managed services, cybersecurity, application hosting, disaster recovery business continuity, cloud migration and other services. Our customers are nationwide, with concentrations in the New York/New Jersey metropolitan area, Arizona, Connecticut, Southern California, North Carolina, Washington, Oregon and Illinois. The Company is publicly traded and is listed and is traded on the NASDAQ Capital Market under the symbol “SSNT”. In December 2019, a novel strain of coronavirus, which causes the disease known as COVID-19, was reported to have surfaced. Since then, COVID-19 coronavirus has spread globally. In March 2020, the World Health Organization declared the COVID-19 outbreak a pandemic and the U.S. Government imposed travel restrictions on travel between the United States, Europe, and certain other countries. The impact of this pandemic has been, and will likely continue to be, extensive in many aspects of society, which has resulted, and will likely continue to result, in significant disruptions to the global economy as well as businesses and capital markets around the world. Currently, the Company’s operations have not been materially affected by the ongoing outbreak of the coronavirus disease 2019 (COVID-19). The ultimate disruption which may be caused by the outbreak is uncertain; however, it may result in a material adverse impact on the Company’s financial position, operations and cash flows. Possible areas that may be affected include, but are not limited to, disruption to the Company’s customers and revenue, labor workforce, inability of customers to pay outstanding accounts receivable due and owing to the Company as they limit or shut down their businesses, customers seeking relief or extended payment plans relating to accounts receivable due and owing to the Company, unavailability of products and supplies used in operations, and the decline in value of assets held by the Company, including property and equipment. However, we currently do not expect a significant impact on our results of operations in the future due to COVID-19. We currently do not expect a significant impact on our results of operations in the future due to Russia’s invasion of Ukraine, as we have minimal business in Russia and Ukraine, both directly and indirectly. However, following the invasion, the U.S. and other countries imposed significant sanctions against the Russian government and many Russian companies and individuals. Although the Company does not have significant operations in Russia, the sanctions could impact the Company’s business in other countries and could have a negative impact on the Company’s future revenue and that of its customers, either of which could adversely affect the Company’s business and financial results. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 6 Months Ended |
Jun. 30, 2023 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies [Text Block] | NOTE 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation and Principles of Consolidation In the opinion of management, the accompanying unaudited condensed consolidated financial statements contain all adjustments necessary to present fairly the financial position of the Company as of June 30, 2023, the results of operations for the three and six months ended June 30, 2023 and 2022 and cash flows for the six months ended June 30, 2023 and 2022. These results are not necessarily indicative of the results to be expected for the full year. The unaudited condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”) and consequently have been condensed and do not include all of the disclosures normally made in an Annual Report on Form 10-K. The December 31, 2022 consolidated balance sheet included herein was derived from the audited consolidated financial statements included in the Company’s Annual Report on Form 10-K. Accordingly, the unaudited condensed consolidated financial statements included herein should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2022, filed with the SEC on February 28, 2023. The accompanying unaudited condensed consolidated financial statements include the accounts of SilverSun and its wholly owned subsidiaries. These unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States. All significant inter-company transactions and accounts have been eliminated in consolidation. Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the unaudited condensed consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. Cash and Cash Equivalents The Company considers all highly liquid investments purchased with original maturities of three months or less to be cash equivalents. The Company maintains cash balances at financial institutions that are insured by the Federal Deposit Insurance Corporation (“FDIC”) up to federally insured limits. At times balances may exceed FDIC insured limits. The Company has not experienced any losses in such accounts. Accounts Receivable and Allowance for Doubtful Accounts Accounts receivable consist primarily of invoices for maintenance and professional services. Full payment for software ordered by customers is primarily due in advance of ordering from the software supplier. Payments for maintenance and support plan renewals are due before the beginning of the maintenance period. Terms under our professional service agreements are generally 50% due in advance and the balance on completion of the services. The Company maintains an allowance for bad debt estimated by considering a number of factors, including the length of time the amounts are past due, the Company’s previous loss history and the customer’s current ability to pay its obligations. Accounts are written off against the allowance when deemed uncollectable. Recoveries of receivables previously written off are recorded as a reduction of bad debt expense when received. Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 326-20-30-2, Financial Instruments Credit Losses Goodwill Goodwill is the excess of acquisition cost of an acquired entity over the fair value of the identifiable net assets acquired. Goodwill is not amortized but tested for impairment annually or whenever indicators of impairment exist. These indicators may include a significant change in the business climate, legal factors, operating performance indicators, competition, sale or disposition of a significant portion of the business or other factors. No impairment losses were identified or recorded for the three or six months ended June 30, 2023 and 2022. Capitalization of Proprietary Developed Software Software development costs are accounted for in accordance with the ASC 985-20, Software Costs of Software to be Sold, Leased or Marketed Business Combinations We account for business combinations under the acquisition method of accounting. This method requires the recording of acquired assets and assumed liabilities at their acquisition date fair values. The excess of the purchase price over the fair value of assets acquired and liabilities assumed is recorded as goodwill. Results of operations related to business combinations are included prospectively beginning with the date of acquisition and transaction costs related to business combinations are recorded within general and administrative expenses. Definite Lived Intangible Assets and Long-lived Assets Purchased intangible assets are recorded at fair value using an independent valuation at the date of acquisition and are amortized over the useful lives of the asset using the straight-line amortization method. The Company assesses potential impairment of its intangible assets and other long-lived assets when there is evidence that recent events or changes in circumstances have made recovery of an asset’s carrying value unlikely. Factors the Company considers important, which may cause impairment include, among others, significant changes in the manner of use of the acquired asset, negative industry or economic trends, and significant underperformance relative to historical or projected operating results. No impairment losses were identified or recorded for the three and six months ended June 30, 2023 and 2022. Revenue Recognition The Company has elected the significant financing component practical expedient in accordance with ASC 606, Revenue from Contracts with Customers. The Company determines revenue recognition through the following 5 steps: ● Identify the contract with a customer; ● Identify the performance obligations in the contract; ● Determine the transaction price; ● Allocate the transaction price to the performance obligation in the contract; and ● Recognize revenue when or as the entity satisfies a performance obligation Software product revenue is recognized when the product is delivered to the customer and the Company’s performance obligation is fulfilled. Service revenue is recognized when the professional consulting, maintenance or other ancillary services are provided to the customer. Shipping and handling costs charged to customers are classified as revenue, and the shipping and handling costs incurred are included in cost of revenues. Components of revenue: For the Three Months Ending June 30, 2023 2022 Software revenue $ 3,298,021 $ 2,782,081 Professional consulting 4,556,214 3,147,702 Maintenance revenue 1,235,100 1,194,556 Ancillary service revenue 4,167,936 3,513,734 $ 13,257,271 $ 10,638,073 For the Six Months Ending June 30, 2023 2022 Software revenue $ 6,620,349 $ 5,393,043 Professional consulting 8,892,845 6,450,506 Maintenance revenue 2,618,069 2,542,556 Ancillary service revenue 8,253,746 7,275,812 $ 26,385,009 $ 21,661,917 Unbilled Services The Company recognizes revenue on its professional services as those services are performed. Unbilled services (contract assets) represent the revenue recognized but not yet invoiced. Deferred Revenues Deferred revenues consist of maintenance on proprietary products (contract liabilities), customer telephone support services (contract liabilities) and deposits for future consulting services that will be earned as such services are performed over the contractual or stated period, which generally ranges from three to twelve months. As of June 30, 2023, there was $372,520 in deferred maintenance revenues, $512,475 in deferred support service revenues and $2,478,659 in deposits for future consulting services. As of December 31, 2022, there was $460,709 in deferred maintenance, $472,266 in deferred support services, and $2,824,115 in deposits for future consulting services. Commissions Sales commissions relating to service revenues are considered incremental and recoverable costs of obtaining a project with our customer. These commissions are calculated based on estimated revenue to be generated over the life of the project. These costs are deferred and expensed as the service revenue is earned. Commission expense is included in selling and marketing expenses in the accompanying unaudited condensed consolidated statements of operations. Fair Value of Financial Instruments The Company estimates that the fair value of all financial instruments at June 30, 2023 and December 31, 2022, as defined in ASC 852 “ Financial Instruments The carrying amounts reported in the unaudited condensed consolidated balance sheets as of June 30, 2023 and December 31, 2022 for cash, accounts receivable, and accounts payable approximate the fair value because of the immediate or short-term maturity of these financial instruments. For each reporting period we evaluate market conditions including available interest rates, credit spreads relative to our credit rating and liquidity in estimating the fair value of our debt. After considering such market conditions, we estimate that the fair value of debt approximates its carrying value. Deferred Charges The Company defers expenses until such time that the expense is consumed and charged to expense at that time. Deferred charges represent expenses related to the merger (see Note 14) and will be charged against the proceeds when the merger is consummated. Leases The Company accounts for its leases in accordance with ASC 842, Leases The Company has assessed its contracts and concluded that its leases consist of finance and operating leases. Operating leases are included in operating lease right-of-use (ROU) assets, current portion of operating lease liabilities, and operating lease liabilities in the Company’s unaudited condensed consolidated balance sheets. ROU assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. As most of the Company’s leases do not provide an implicit rate, the Company determines an incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. The incremental borrowing rate represents a significant judgment that is based on an analysis of the Company’s credit rating, country risk, treasury and corporate bond yields, as well as comparison to the Company’s borrowing rate on its most recent loan. The Company uses the implicit rate when readily determinable. The operating lease ROU asset also includes any lease payments made and excludes lease incentives. Lease expense for lease payments is recognized on a straight-line basis over the lease term. The Company has lease agreements with lease and non-lease components, which are generally accounted for separately. The Company finances purchases of hardware and computer equipment through finance lease agreements. Finance lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at commencement date. Concentrations The Company maintains its cash with various institutions, which exceed federally insured limits throughout the year. At June 30, 2023 and December 31, 2022, the Company had cash on deposit of $6,030,908 and $7,050,862, respectively, in excess of the federally insured limits of $250,000. As of June 30, 2023, no one customer represented more than 10% of the total accounts receivable and unbilled services. As of December 31, 2022, no one customer represented more than 10% of the total accounts receivable and unbilled services. For the six months ended June 30, 2023 and 2022, the Company’s top ten customers accounted for 10% ($2,681,200) and 9% ($1,856,981), respectively, of total revenues. The Company does not rely on any one specific customer for any significant portion of its revenue. For the six months ended June 30, 2023 and 2022 purchases from one supplier through a “channel partner” agreement were approximately 14% and 14% of cost of revenues, respectively. The channel partner agreements are for a one-year term and automatically renew for an additional one-year term on the anniversary of the agreement’s effective date. As of June 30, 2023, one supplier represented approximately 22% of total accounts payable. For the year ended December 31, 2022, one supplier represented approximately 28% of total accounts payable. Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of accounts receivable and cash. As of June 30, 2023, the Company believes it has no significant risk related to its concentration of credit risk related to accounts receivable. Property and Equipment Property and equipment is stated at cost, net of accumulated depreciation and amortization. Depreciation is computed using the straight-line method based upon the estimated useful lives of the assets, generally three to seven years. Maintenance and repairs that do not materially add to the value of the equipment nor appreciably prolong its life are charged to expense as incurred. When assets are retired or otherwise disposed of, the cost and related accumulated depreciation are removed from the accounts and the resulting gain or loss is included in the unaudited condensed consolidated statements of operations. Income Taxes The Company accounts for income taxes using the asset and liability method described in ASC 740, “ Income Taxes Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes, as well as net operating loss carryforwards. Based on ASU 2015-17, all deferred tax assets or liabilities are classified as long-term. Valuation allowances are established against deferred tax assets if it is more likely than not that the assets will not be realized. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates or laws is recognized in operations in the period that includes the enactment date. The Company accounts for uncertainties in income taxes under ASC 740-10-50 which prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. ASC 740-10 requires that the Company determine whether the benefits of its tax positions are more-likely-than-not of being sustained upon audit based on the technical merits of the tax position. The Company recognizes the impact of an uncertain income tax position taken on its income tax return at the largest amount that is more-likely-than-not to be sustained upon audit by the relevant taxing authority. The Company has federal net operating loss (“NOL”) carryforwards which are subject to limitations under Section 382 of the Internal Revenue Code. The Company files income tax returns in the U.S. federal and state jurisdictions. Tax years 2019 to 2022 remain open to examination for both the U.S. federal and state jurisdictions. Despite the Company’s belief that its tax return positions are consistent with applicable tax laws, one or more positions may be challenged by taxing authorities. Settlement of any challenge can result in no change, a complete disallowance, or some partial adjustment reached through negotiations or litigation. Interest and penalties related to income tax matters, if applicable, will be recognized as income tax expense. There were no liabilities for uncertain tax positions at June 30, 2023 and December 31, 2022. Fair Value Measurement The accounting standards define fair value and establish a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use on unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs that market participants would use in pricing the asset or liability developed based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company’s assumptions about the assumptions market participants would use in pricing the asset or liability developed based on the best information available in the circumstances. The hierarchy is as follows: Level 1: Quoted prices (unadjusted) in active markets that are accessible at the measurement date for assets or liabilities. The fair value hierarchy gives the highest priority to Level 1 inputs. Level 2: Observable prices that are based on inputs not quoted on active markets but corroborated by market data. Level 3: Unobservable inputs are used when little or no market data is available. The fair value hierarchy gives the lowest priority to Level 3 inputs. The Company’s current financial assets and liabilities approximate fair value due to their short-term nature and include cash, accounts receivable, accounts payable, and accrued liabilities. The carrying value of longer-term leases and debt obligations approximate fair value as their stated interest rates approximate the rates currently available. The Company’s goodwill and intangibles are measured at fair-value using Level 3 inputs at acquisition, as discussed in Notes 6 and 11. Stock-Based Compensation Compensation expense related to share-based transactions, including employee stock options, is measured and recognized in the financial statements based on a determination of the fair value. The grant date fair value is determined using the Black-Scholes-Merton (“Black-Scholes”) pricing model. For employee stock options, the Company recognizes expense over the requisite service period on a straight-line basis (generally the vesting period of the equity grant). The Company’s option pricing model requires the input of highly subjective assumptions, including the expected stock price volatility and expected term. Any changes in these highly subjective assumptions significantly impact stock-based compensation expense. Recently Adopted Authoritative Pronouncements In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses - Measurement of Credit Losses on Financial Instruments Recent Authoritative Pronouncements No other recently issued accounting pronouncements had or are expected to have a material impact on the Company’s unaudited condensed consolidated financial statements. |
NET INCOME (LOSS) PER COMMON SH
NET INCOME (LOSS) PER COMMON SHARE | 6 Months Ended |
Jun. 30, 2023 | |
Earnings Per Share [Abstract] | |
Earnings Per Share [Text Block] | NOTE 3 NET INCOME (LOSS) PER COMMON SHARE The Company’s basic income (loss) per common share is based on net income (loss) for the relevant period, divided by the weighted average number of common shares outstanding during the period. Diluted income (loss) per common share is based on net income (loss), divided by the weighted average number of common shares outstanding during the period, including common share equivalents, such as outstanding option and warrants to the extent they are dilutive. For the three and six months ended June 30, 2023 and 2022, the average market prices for the periods ended are less than the exercise price of all the outstanding stock options, therefore, the inclusion of the stock options would be anti-dilutive. In addition, for the three and six months ended June 30, 2022, since the Company has a net loss, the effect of common stock equivalents is anti-dilutive, and, as such, common stock equivalents have been excluded from the calculation. Three Months Ended Three Months Ended June 30, 2023 June 30, 2022 Basic net income (loss) per share computation: Net income (loss) $ 343,361 $ (87,766 ) Weighted-average common shares outstanding 5,256,177 5,136,177 Basic net income (loss) per share $ 0.07 $ (0.02 ) Diluted net income (loss) per share computation: Net income (loss) per above $ 343,361 $ (87,766 ) Weighted-average common shares outstanding 5,256,177 5,136,177 Total adjusted weighted-average shares 5,256,177 5,136,177 Diluted net income (loss) per share $ 0.07 $ (0.02 ) Six Months Ended Six Months Ended June 30, 2023 June 30, 2022 Basic net income (loss) per share computation: Net income (loss) $ 620,852 $ (128,422 ) Weighted-average common shares outstanding 5,256,177 5,136,177 Basic net income (loss) per share $ 0.12 $ (0.03 ) Diluted net income (loss): Net income (loss) $ 620,852 $ (128,422 ) Weighted-average common shares outstanding 5,256,177 5,136,177 Total adjusted weighted-average shares 5,256,177 5,136,177 Diluted net income (loss)per share $ 0.12 $ (0.03 ) The following table summarizes securities that, if exercised, would have an anti-dilutive effect on income (loss) per share. Three Months Ended June 30, 2023 Three Months Ended June 30, 2022 Stock options 158,420 165,620 Total potential dilutive securities not included in income (loss) income per share 158,420 165,620 The following table summarizes securities that, if exercised, would have an anti-dilutive effect on income (loss) per share. Six Months Ended June 30, 2023 Six Months Ended June 30, 2022 Stock options 158,420 162,020 Total potential dilutive securities not included in (loss) income per share 158,420 162,020 |
ALLOWANCE FOR EXPECTED CREDIT L
ALLOWANCE FOR EXPECTED CREDIT LOSSES | 6 Months Ended |
Jun. 30, 2023 | |
Disclosure Text Block Supplement [Abstract] | |
Allowance for Credit Losses [Text Block] | NOTE 4 ALLOWANCE FOR EXPECTED CREDIT LOSSES Trade receivables and unbilled services with customers are financial assets analyzed by the Company under the expected credit loss model. To measure expected credit losses, trade receivables are grouped based on shared risk characteristics (i.e., the relevant industry sector and customer's geographical location) and days past due (i.e., delinquency status), while considering the following, if appropriate: ● Customers in the same geographical location share similar risk characteristics associated with the macroeconomic environment of their region. ● The expected credit loss rate is likely to increase as receivables move to older aging buckets. The Company used the following aging categories to estimate the risk of delinquency status: (i) 0 days past due; (ii) 1-30 days past due; (iii) 31-60 days past due; (iv) 61-90 days past due; and (v) over 90 days past due. If a financial asset does not share similar risk characteristics with other financial assets held by the reporting entity, the allowance for credit losses should be determined on an individual basis. Similar risk characteristics for trade receivables may include customer credit rating, trade receivable aging category (e.g., 30-90 days past due), industry, geographical location of the customer, product line, and other factors that may influence the likelihood of the customer not being able to pay for the goods or services. The Company, for the most part, utilizes this individual approach for its trade receivables and unbilled services as each customer does not share similar risks. Roll-forward of Allowance for Doubtful Accounts The following table represents the roll-forward of the allowance for doubtful accounts for the six months ended June 30, 2023 and the year ended December 31, 2022: June 30, 2023 December 31, 2022 Balance at beginning of period $ 490,311 $ 330,311 Current period provision for expected losses 25,000 170,178 Write-offs (92,640 ) (10,178 ) Balance at end of period $ 422,671 $ 490,311 |
PROPERTY AND EQUIPMENT
PROPERTY AND EQUIPMENT | 6 Months Ended |
Jun. 30, 2023 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment Disclosure [Text Block] | NOTE 5 PROPERTY AND EQUIPMENT Property and equipment is summarized as follows: June 30, 2023 December 31, 2022 Leasehold improvements $ 165,701 $ 165,701 Equipment, furniture and fixtures 3,845,435 3,821,575 4,011,136 3,987,276 Less: Accumulated depreciation and amortization (3,454,032 ) (3,275,962 ) Property and equipment, net $ 557,104 $ 711,314 Depreciation and amortization expense related to these assets for the three and six months ended June 30, 2023 were $85,529 and $178,070, respectively, as compared to $96,582 and $195,007 for the three and six months ended June 30, 2022. Property and equipment under finance leases (included in Note 8) are summarized as follows: June 30, 2023 December 31, 2022 Equipment, furniture, and fixtures $ 1,256,092 $ 1,256,092 Less: Accumulated amortization (823,898 ) (716,743 ) Property and equipment, net $ 432,194 $ 539,349 |
INTANGIBLE ASSETS
INTANGIBLE ASSETS | 6 Months Ended |
Jun. 30, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets Disclosure [Text Block] | NOTE 6 INTANGIBLE ASSETS Intangible assets consist of proprietary developed software, intellectual property, customer lists and acquired contracts carried at cost less accumulated amortization and customer lists acquired at fair value less accumulated amortization. Amortization is computed using the straight-line method over the estimated useful lives. On January 1, 2022 (“Effective Date”), the Company entered into an asset purchase agreement with Dynamic Tech Services, Inc (“DTS”) to acquire certain assets of DTS. The purchase price for the Acquired Assets was $1,335,000, $500,000 of which was paid in cash and $835,000 of which was paid through the issuance of a four-year $835,000 promissory note dated January 1, 2022, paying interest at the rate of 3.25% per annum (see Note 11). On January 19, 2022, SWK acquired the customer list of NEO3, LLC (“NEO3”) pursuant to an Asset Purchase Agreement for the customer list for $150,000 cash and the issuance of a promissory note in the aggregate principal amount of $75,000 (the “NEO3 Note”). The NEO3 Note is due in 36 months from the closing date and bears interest at a rate of two percent (2.0%) per annum. Monthly payments including interest are $2,148. The purchase price has been recorded as an intangible asset with an estimated life of seven years. The components of intangible assets are as follows: June 30, 2023 December 31, 2022 Estimated Useful Lives Proprietary developed software $ 390,082 $ 390,082 5 –7 Intellectual property, customer list, and acquired contracts 7,743,283 7,743,283 5 –15 Total intangible assets 8,133,365 8,133,365 Less: accumulated amortization (4,191,934 ) (3,868,012 ) $ 3,941,431 $ 4,265,353 Amortization expense related to the above intangible assets for the three and six months ended June 30, 2023 was $161,961 and $323,922, respectively, as compared to $186,365 and $376,822 for the three and six months ended June 30, 2022. The Company expects future amortization expense to be the following: Amortization Remainder of 2023 $ 323,922 2024 647,844 2025 644,367 2026 633,165 2027 619,516 Thereafter 1,072,617 Total $ 3,941,431 |
LONG-TERM AND RELATED PARTY DEB
LONG-TERM AND RELATED PARTY DEBT | 6 Months Ended |
Jun. 30, 2023 | |
Line Of Credit And Term Loan Abstract | |
Line of Credit and Term Loan [Text Block] | NOTE 7 LONG-TERM AND RELATED PARTY DEBT On July 31, 2020, the Company acquired certain assets of Prairie Technology Solutions Group, LLC (“Prairie Tech”) pursuant to an Asset Purchase Agreement. In consideration for the acquired assets, the Company paid $185,000 in cash and issued three promissory notes to Prairie Tech (“Prairie Tech Note 1”, “Prairie Tech Note 2” and “Prairie Tech Note 3”), each in the principal aggregate amount of $103,333 (collectively the “Prairie Tech Notes”). This long-term debt is considered related party debt as a holder is a current employee of the Company. The Prairie Tech Notes bear interest at a rate of 4% per annum. Prairie Tech Note 1 had a term of one (1) year and was subject to downward adjustment based on whether certain revenue milestones are achieved. In July 2021, the Company waived its rights to any downward adjustments on these notes, and agreed to pay the full-face amount, plus interest, on those notes on the date of maturity. Prairie Tech Note 2 has a term of two (2) years and is also subject to downward adjustment based on whether certain revenue milestones are achieved. Prairie Tech Note 3 had a term of three (3) years and was not subject to a downward adjustment. On July 31, 2021, the Company paid Note 1 and accrued interest in the amount of $107,543. On August 4, 2022, the Company paid Note 2 and accrued interest in the amount of $111,924. At June 30, 2023 and December 31, 2022, the outstanding balances on the PT Notes were $103,333 and $103,333, respectively. On July 1, 2023, the Company repaid the outstanding balance of $103,333 and accrued interest. On October 1, 2020, SWK acquired certain assets of Computer Management Services, LLC, (“CMS”) pursuant to an Asset Purchase Agreement for cash of $410, clients’ deposits related to technical support in the amount of $50,115, prepaid time from clients in the amount of $67,073, and the issuance of a promissory note in the aggregate principal amount of $170,000 (the “CMS Note”) for a total of $287,598. The CMS Note is due in 36 months from the closing date and bears interest at a rate of two percent (2.0%) per annum. Monthly payments including interest are $4,869. At June 30, 2023 and December 31, 2022, the outstanding balances on the CMS Note were $19,396 and $48,249, respectively. On December 1, 2020, SWK acquired certain assets of Business Software Solutions (“BSS”) pursuant to an Asset Purchase Agreement for a promissory note in the aggregate principal amount of $230,000 (the “BSS Note”). The BSS Note is due in 60 months from the closing date and bears interest at a rate of two percent (2.0%) per annum. Monthly payments including interest are $4,031. At June 30, 2023 and December 31, 2022, the outstanding balances on the BSS Note were $117,872 and $140,748, respectively. On April 1, 2021, SWK acquired certain assets of CT-Solution, Inc. (“CTS”) pursuant to an Asset Purchase Agreement for a promissory note in the aggregate principal amount of $130,000 (the “CTS Note”). The CTS Note is due in 36 months from the closing date and bears interest at a rate of two percent (2.0%) per annum. Monthly payments including interest are $3,724. At June 30, 2023 and December 31, 2022, the outstanding balances on the CTS Note were $36,896 and $58,741, respectively. On May 1, 2021, SWK acquired certain assets of PeopleSense, Inc. (“PSI”) pursuant to an Asset Purchase Agreement for cash of $145,703, customer deposits related to prepaid time from clients in the amount of $99,938, and the issuance of a promissory note in the aggregate principal amount of $450,000 (the “PSI Note”). The PSI Note is due in 36 months from the closing date and bears interest at a rate of two percent (2.0%) per annum. Monthly payments including interest are $12,889. At June 30, 2023 and December 31, 2022, the outstanding balances on the PSI Note were $140,373 and $215,863, respectively. On January 1, 2022, SWK acquired certain assets of Dynamic Tech Services, Inc. (“DTSI”) pursuant to an Asset Purchase Agreement for $500,000 cash and the issuance of a promissory note in the aggregate principal amount of $835,000 (the “DTSI Note”). The DTSI Note bears interest at a rate of three and one-quarter percent (3.25%) per annum. The principal amount of the Note was subject to a downward adjustment in the event the Company lost any subscription renewal revenue during the one-year period immediately following the Effective Date from any persons that were customers of DTS immediately prior to the Effective Date (the “DTS Customers”). Any such downward adjustment would be determined by calculating the percentage of loss of Acumatica subscription renewals during the one-year period immediately following the Effective Date from DTS Customers. In the event that subscription renewal revenue received from DTS Customers during the one-year period immediately following the Effective Date was less than 95% of the subscription renewal revenue received by DTS from DTS Customers during the one-year period immediately preceding the Effective Date, the principal amount of the Note would be reduced. The measuring period for any downward adjustment would be as of the one-year anniversary of the Effective Date. Notwithstanding the foregoing, under no circumstances would the principal amount of the Note be reduced by reason of such downward adjustment by more than $150,000 ( i.e. On January 19, 2022, SWK acquired the customer list of NEO3, LLC (“NEO3”) pursuant to an Asset Purchase Agreement for the customer list for $150,000 cash and the issuance of a promissory note in the aggregate principal amount of $75,000 (the “NEO3 Note”). The NEO3 Note is due in 36 months from the closing date and bears interest at a rate of two percent (2.0%) per annum. Monthly payments including interest are $2,148. At June 30, 2023 and December 31, 2022, the outstanding balance on the NEO3 Note was $40,144 and $52,559, respectively. Total long-term and related party debt balances at June 30, 2023 and December 31, 2022 were $1,032,076 and $1,454,493, respectively, of which $580,402 and $783,479 was classified as current portion at June 30, 2023 and December 31, 2022, respectively. At June 30, 2023, future payments of long-term debt are as follows: Remainder of 2023 $ 361,062 2024 360,091 2025 258,736 2026 52,187 Total $ 1,032,076 |
FINANCE LEASE OBLIGATIONS
FINANCE LEASE OBLIGATIONS | 6 Months Ended |
Jun. 30, 2023 | |
Disclosure Text Block [Abstract] | |
Lessee, Finance Leases [Text Block] | NOTE 8 FINANCE LEASE OBLIGATIONS The Company has entered into lease commitments for equipment that meet the requirements for capitalization. The equipment has been capitalized and is included in property and equipment in the accompanying unaudited condensed consolidated balance sheets. The weighted average interest rate as of June 30, 2023 was 7.24% and the following weighted-average lease term: June 30, 2023 December 31, 2022 Weighted average remaining lease term 3.15 3.44 At June 30, 2023 future payments under finance leases are as follows: June 30, 2023 Remainder of 2023 $ 122,905 2024 176,686 2025 115,080 2026 115,080 2027 47,950 Total minimum lease payments 577,701 Less amounts representing interest (70,046 ) Present value of net minimum lease payments 507,655 Less current portion (202,420 ) Long-term finance lease obligation $ 305,235 |
OPERATING LEASE LIABILITY
OPERATING LEASE LIABILITY | 6 Months Ended |
Jun. 30, 2023 | |
Disclosure Text Block [Abstract] | |
Lessee, Operating Leases [Text Block] | NOTE 9 OPERATING LEASE LIABILITY The Company leases space in four different locations and also has an equipment lease rental with monthly payments ranging from $3,180 to $10,279 which expire at various dates through September 30, 2026. On September 29, 2022, the Company entered into an operating lease for equipment with Digital Fortress, Inc. Accordingly, operating lease right of use assets and operating lease liabilities were recognized in the amount of $109,840 during the period ended June 30, 2023. On October 12, 2022, the Company entered into an operating lease for equipment and space with Cologix USA, Inc. Accordingly, operating lease right of use assets and operating lease liabilities were recognized in the amount of $106,471 during the period ended June 30, 2023. On June 2, 2023, the Company entered into an operating lease to extend its lease for its Arizona office with Exeter 17319 DE, LLC. Accordingly, operating lease right of use assets and operating lease liabilities were recognized for the extension in the amount of $108,330 during the period ended June 30, 2023. The Company's leases generally do not provide an implicit rate, and therefore the Company uses its incremental borrowing rate as the discount rate when measuring operating lease liabilities. The incremental borrowing rate represents an estimate of the interest rate the Company would incur at lease commencement to borrow an amount equal to the lease payments on a collateralized basis over the term of a lease. The asset and liability were valued using an weighted average interest rate of 4.77%. The Company's weighted average remaining lease term for operating leases as of June 30, 2023 and December 31, 2022 are as follows: June 30, 2023 December 31, 2022 Weighted average remaining lease term 1.84 1.19 The following table reconciles the undiscounted future minimum lease payments (displayed by year and in the aggregate) under noncancelable operating leases with terms of more than one year to the total lease liabilities recognized on the unaudited condensed consolidated balance sheet as of June 30, 2023: Remainder 2023 $ 188,485 2024 197,163 2025 72,058 2026 30,786 Total undiscounted future minimum lease payments 488,492 Less: Difference between undiscounted lease payments and discounted lease liabilities (23,450 ) Total operating lease liabilities 465,042 Less current portion (302,739 ) Long-term operating lease liabilities $ 162,303 Total rent expense under operating leases for the three and six months ended June 30, 2023 was $103,213 and $213,080, respectively, as compared to $123,086 and $258,217 for the three and six months ended June 30, 2022, respectively. |
EQUITY
EQUITY | 6 Months Ended |
Jun. 30, 2023 | |
Stockholders' Equity Note [Abstract] | |
Equity [Text Block] | NOTE 10 EQUITY Stock Repurchase Program On October 10, 2019, the Company’s Board of Directors authorized a new stock repurchase program, under which the Company may repurchase up to $2 million of its outstanding common stock. Under this new stock repurchase program, the Company may repurchase shares in accordance with all applicable securities laws and regulations, including Rule 10b-18 of the Securities Exchange Act of 1934, as amended. The extent to which the Company repurchases its shares, and the timing of such repurchases, will depend upon a variety of factors, including market conditions, regulatory requirements, and other corporate considerations, as determined by the Company’s management. The repurchase program may be extended, suspended, or discontinued at any time. The Company expects to finance the program from existing cash resources. On November 5, 2021, the Board of Directors voted to increase the authorized amount of the buyback from $2 million to $5 million. As of June 30, 2023, no repurchases have been made. Stock Options The Company adopted the 2019 Equity and Incentive Plan (the “2019 Plan”) to order provide long-term incentives for employees and non-employees to contribute to the growth of the Company and attain specific performance goals. The fair value of each option awarded is estimated on the date of grant using the Black-Scholes option valuation model that uses the assumptions noted in the following table. Expected volatilities are based on historical volatility of Common Stock. The expected life of the options granted represents the period of time from date of grant to expiration. The risk-free interest rate is based on the U.S. Treasury yield in effect at the time of grant. There were no stock options granted for the six months ended June 30, 2023. A summary of the status of the Company’s stock option plans for the six months ended June 30, 2023 and the year ended December 31, 2022 and changes during the periods are presented below (in number of options): Number of Options Average Exercise Price Outstanding options at January 1, 2022 165,620 $ 6.256 Options granted - - Options canceled/forfeited (7,200 ) $ 6.530 Outstanding options at December 31, 2022 158,420 $ 6.245 Options granted - - Options canceled/forfeited - $ - Outstanding options at June 30, 2023 158,420 $ 6.245 For the three and six months ended June 30, 2023, the Company recorded share-based compensation expense of $-0- and $41,497, respectively, as compared to $45,945 and $91,890 for the three and six months ended June 30, 2022. As of June 30, 2023 and December 31, 2022, the unamortized compensation expense for stock options was $-0- and $41,497, respectively. |
BUSINESS COMBINATION
BUSINESS COMBINATION | 6 Months Ended |
Jun. 30, 2023 | |
Business Combinations [Abstract] | |
Business Combination Disclosure [Text Block] | NOTE 11 BUSINESS COMBINATIONS On January 1, 2022 (“Effective Date”), the Company entered into an asset purchase agreement with Dynamic Tech Services, Inc (DTS”) to acquire certain assets of DTS. The purchase price for the Acquired Assets was $1,335,000, $500,000 of which was paid in cash and $835,000 of which was paid through the issuance of a four-year $835,000 promissory note dated January 1, 2022, paying interest at the rate of 3.25% per annum. The principal amount of the Note was subject to a downward adjustment in the event the Company lost any subscription renewal revenue during the one-year period immediately following the Effective Date from any persons that were customers of DTS immediately prior to the Effective Date (the “DTS Customers”). Any such downward adjustment would be determined by calculating the percentage of loss of Acumatica subscription renewals during the one-year period immediately following the Effective Date from DTS Customers. In the event that subscription renewal revenue received from DTS Customers during the one-year period immediately following the Effective Date was less than 95% of the subscription renewal revenue received by DTS from DTS Customers during the one-year period immediately preceding the Effective Date, the principal amount of the Note would be reduced. The measuring period for any downward adjustment will be as of the one-year anniversary of the Effective Date. Notwithstanding the foregoing, under no circumstances would the principal amount of the Note be reduced by reason of such downward adjustment by more than $150,000 ( i.e. The Company expects its acquisitions to create synergies by combining operations and expanding geographic market share and product offerings. The following summarizes the purchase price allocation for all prior year and current year’s acquisitions: 2022 Purchase DTS Cash consideration $ 500,000 Note payable 835,000 Total purchase price $ 1,335,000 Customer list $ 1,207,000 Goodwill 128,000 Total assets acquired 1,335,000 Deferred revenue - Net assets acquired $ 1,335,000 The Company’s unaudited condensed consolidated financial statements for the three and six months ended June 30, 2023 and 2022 include the actual results of DTS, and as such, pro forma results are not required. |
INCOME TAXES
INCOME TAXES | 6 Months Ended |
Jun. 30, 2023 | |
Income Tax Disclosure [Abstract] | |
Income Tax Disclosure [Text Block] | NOTE 12 INCOME TAXES FASB ASC 740-10, “Accounting for Uncertainty in Income Taxes” (“ASC 740-10”) prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. The Company has analyzed filing positions in all of the federal and state jurisdictions where it is required to file income tax returns, as well as all open tax years in these jurisdictions. The Company does not have any unrecognized tax benefits. The recognized deferred tax asset is based upon the expected utilization of its benefit from future taxable income. The Company has federal net operating loss (“NOL”) carryforwards of approximately $5,000,000 as of June 30, 2023, which is subject to limitations under Section 382 of the Internal Revenue Code. These carryforward losses are available to offset future taxable income and a portion begin to expire in the year 2025 to 2033. The tax effect of temporary differences, primarily net operating loss carryforwards, asset reserves and depreciation, gave rise to the Company’s deferred tax asset. Deferred income taxes are recognized for the tax consequence of such temporary differences at the enacted tax rate expected to be in effect when the differences reverse. The Company had approximately $886,000 and $1,106,000 in deferred tax assets at June 30, 2023 and December 31, 2022, respectively. The decrease in the deferred tax asset is due to provision for income taxes, which will reduce our NOL carryforward and the receipt of state and federal refunds. For the three and six months ended June 30, 2023, the Company’s Federal and State provision requirements were calculated based on the estimated tax rate. For the three and six months ended June 30, 2023, the Company recorded tax provisions of $95,481 and $170,272, respectively, as compared to tax benefits of $15,280 and $13,192 for the three and six months ended June 30, 2022, respectively. These increases in the tax provision are primarily the result of the increase in income before taxes for the three and six months ended June 30, 2023 as compared to the three and six months ended June 30, 2022. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 6 Months Ended |
Jun. 30, 2023 | |
Related Party Transactions [Abstract] | |
Related Party Transactions Disclosure [Text Block] | NOTE 13 RELATED PARTY TRANSACTIONS At June 30, 2023 and December 31, 2022, certain long-term debt is considered a related party liability as a holder of Prairie Tech is current employee of the Company. As of June 30, 2023 and December 31, 2022, the outstanding balances of this debt were $103,333 and $103,333, respectively. |
MERGER
MERGER | 6 Months Ended |
Jun. 30, 2023 | |
Disclosure Text Block Supplement [Abstract] | |
Mergers, Acquisitions and Dispositions Disclosures [Text Block] | NOTE 14 MERGER On September 29, 2022, the Company entered into a definitive agreement and plan of merger (the “Merger Agreement”) with Rhodium Enterprises, Inc. (“Rhodium”), an industrial-scale digital asset technology company utilizing proprietary technologies to mine bitcoin. Under the terms of the Merger Agreement, which has been unanimously approved by the Boards of Directors of both SilverSun and Rhodium, upon the consummation of the business combination, the Company will receive $10 million in cash and will retain 3.2% equity in SilverSun upon consummation of the merger. Each holder of an outstanding share of SilverSun common stock will receive: ● A cash dividend of $1.50 per share, which equates to $7,884,266 in the aggregate; ● A stock dividend of one share of SilverSun Technologies Holdings, Inc. ("HoldCo"), a recently formed subsidiary of SilverSun. HoldCo's sole assets are its 100% ownership of SWK and SCS (together the "Subsidiaries"), which Subsidiaries accounted for the large majority of SilverSun's revenue in 2022. It is expected that the capital structure of HoldCo will roughly approximate the current capital structure of SilverSun; ● Following the consummation of the business combination, the business of the Subsidiaries will continue to be operated consistent with past practices. The current management and Board of Directors of SilverSun, including Mark Meller, the Chief Executive Officer of both SilverSun and SWK, will continue in their current roles at both HoldCo and the Subsidiaries. HoldCo will apply for public listing and the shares distributed in the stock dividend will be registered pursuant to a Form 10 that will be filed by HoldCo with the SEC (subject to regulatory and exchange regulations and approvals); and ● The shares of SilverSun's common stock to be retained by the current SilverSun stockholders following the consummation of the business combination will collectively represent approximately 3.2% of SilverSun's pro forma common equity ownership. The proposed Mergers are subject to the receipt of any applicable regulatory approvals, the approval of SilverSun's and Rhodium's respective stockholders, and other customary closing conditions. Prior to the Mergers, SilverSun will hold a special meeting of its shareholders as of a pre-Merger record date to be determined (the “Special Meeting”). At the Special Meeting, the SilverSun stockholders will be asked to vote on the proposals set forth in the Form S-4 Registration Statement of SilverSun (the “Form S-4”) filed on October 19, 2022, as amended on January 9, 2023, February 14, 2023, April 4, 2023, April 28, 2023 and July 11, 2023 and as may be further amended in the future. These proposals include, but are not limited to, approval of (i) the Mergers; (ii) the Amended and Restated Certificate of Incorporation (and the matters covered thereby including the Reverse Stock Split); (iii) the Separation and Distribution Agreement; (iv) the SilverSun Technologies, Inc. 2023 Omnibus Incentive Plan; (v) the share issuances related to the Mergers requiring Nasdaq approval; and (vi) the post-Merger board nominees. These proposals are set forth in greater detail in the Form S-4. The Mergers are conditioned upon the approval of the Merger Proposal, subject to terms of the Merger Agreement. If the Merger Proposal is not approved, the other proposals (except the adjournment proposal, as described in the S-4 ) will not be presented to the shareholders for a vote. Similarly, approval of the Merger proposal is subject to the approval of the Amended and Restated Certificate of Incorporation proposal, the Separation and Distribution. On March 13, 2023, SilverSun Technologies, Inc. (the “Company”) entered into the Third Amendment to Merger Agreement (the “Amendment”) with Rhodium Enterprises Acquisition Corp., a Delaware corporation and direct wholly owned subsidiary of the Company, Rhodium Enterprises Acquisition LLC, a Delaware limited liability company and direct wholly owned subsidiary of the Company, and Rhodium Enterprises, Inc., a Delaware corporation (“Rhodium”), amending that certain Agreement and Plan of Merger, dated as of September 29, 2022 by and among the parties referenced above (as amended from time to time, the “Merger Agreement”). The Amendment provides that the Merger Agreement may be terminated, and the transactions abandoned, by either the Company or Rhodium at any time before the First Effective Time (as defined in the Merger Agreement), by written notice from one to the other if the closing has not occurred on or before June 30, 2023. No other provisions of the Merger Agreement were modified by the Amendment. On July 11, 2023, SilverSun Technologies, Inc. (the “Company”) entered into the Fifth Amendment to Merger Agreement (the “Amendment”) with Rhodium Enterprises Acquisition Corp., a Delaware corporation and direct wholly owned subsidiary of the Company, Rhodium Enterprises Acquisition LLC, a Delaware limited liability company and direct wholly owned subsidiary of the Company, and Rhodium Enterprises, Inc., a Delaware corporation (“Rhodium”), amending that certain Agreement and Plan of Merger, dated as of September 29, 2022 by and among the parties referenced above (as amended from time to time, the “Merger Agreement”). The Amendment provides that the Merger Agreement may be terminated, and the transactions abandoned, by either the Company or Rhodium at any time before the First Effective Time (as defined in the Merger Agreement), by written notice from one to the other if the closing has not occurred on or before September 30, 2023. The Amendment also removes Section 7.06 from the Agreement. This section had provided for the payment of a $5,000,000 termination fee by the Company or Rhodium, as applicable, upon certain enumerated termination events. Following such removal, the Company and Rhodium continue to retain all other legal remedies available to them upon such termination events. The Merger Agreement may be terminated, whether before or after obtaining the requisite vote of SilverSun shareholders, by mutual written consent of SilverSun and Rhodium. The Merger Agreement may be terminated, and the transactions abandoned, by either SilverSun or Rhodium at any time before the effective time of the merger , by written notice from one to the other if (i) the Closing has not occurred on or before June 30, 2023 or such later date mutually agreed to by SilverSun and Rhodium (the “Termination Date”), except that the right to terminate the Merger Agreement for this reason is not available to any party who is then in material breach of the Merger Agreement; The Merger Agreement may be terminated, and the transactions abandoned, by SilverSun at any time before the First Effective Time, if If the Merger Agreement is validly terminated pursuant to the termination section of the Merger Agreement, except as provided below, it shall become void and of no further force and effect, with no liability (except as provided below) on the part of any party (or any stockholder, affiliate or representative of such party), except SilverSun Technologies Holdings, Inc. filed its Form 10 with the SEC on December 23, 2022. The Form 10 was withdrawn on February 21, 2023 because the financial statements contained therein were stale. SilverSun Technologies Holdings, Inc. refiled the Form 10 on March 3, 2023. On May 1, 2023, the Form 10 was withdrawn as the contemplated merger has not yet occurred. On April 4, 2023, the Company filed Amendment 3 to its Form S-4 Registration Statement with the SEC. On April 28, 2023 the Company filed Amendment 4 to its Form S-4 Registration Statement with the SEC. Set forth below is the description of each class of securities of SilverSun Technologies, Inc. (the “Company”) outstanding as of December 31, 2022. The following description summarizes the most important terms of these securities. This summary does not purport to be complete and is qualified in its entirety by the provisions of our Certificate of Incorporation and our Bylaws, copies of which have been previously filed with the Securities and Exchange Commission and are incorporated by reference into the Annual Report on Form 10-K for the year ended December 31, 2022. You should refer to our Articles of Incorporation, Bylaws and the applicable provisions of the Delaware General Corporation Law for a complete description. Common stock, par value $0.00001 per share (the “Common Stock”) is the only class of our securities currently registered under Section 12 of the Securities Exchange Act of 1934 (the “Exchange Act”). Our Common Stock is listed on the Nasdaq Capital Market under the symbol “SSNT.” |
SUBSEQUENT
SUBSEQUENT | 6 Months Ended |
Jun. 30, 2023 | |
Subsequent Events [Abstract] | |
Subsequent Events [Text Block] | NOTE 15 – SUBSEQUENT EVENT On August 4, 2023, the Board of Directors approved the payment of a $0.20 special cash dividend per share of Common Stock to shareholders of record August 18, 2023. The dividend will be paid on August 25, 2023. |
Accounting Policies, by Policy
Accounting Policies, by Policy (Policies) | 6 Months Ended |
Jun. 30, 2023 | |
Accounting Policies [Abstract] | |
Basis of Accounting, Policy [Policy Text Block] | Basis of Presentation and Principles of Consolidation In the opinion of management, the accompanying unaudited condensed consolidated financial statements contain all adjustments necessary to present fairly the financial position of the Company as of June 30, 2023, the results of operations for the three and six months ended June 30, 2023 and 2022 and cash flows for the six months ended June 30, 2023 and 2022. These results are not necessarily indicative of the results to be expected for the full year. The unaudited condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”) and consequently have been condensed and do not include all of the disclosures normally made in an Annual Report on Form 10-K. The December 31, 2022 consolidated balance sheet included herein was derived from the audited consolidated financial statements included in the Company’s Annual Report on Form 10-K. Accordingly, the unaudited condensed consolidated financial statements included herein should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2022, filed with the SEC on February 28, 2023. The accompanying unaudited condensed consolidated financial statements include the accounts of SilverSun and its wholly owned subsidiaries. These unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States. All significant inter-company transactions and accounts have been eliminated in consolidation. |
Use of Estimates, Policy [Policy Text Block] | Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the unaudited condensed consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. |
Cash and Cash Equivalents, Policy [Policy Text Block] | Cash and Cash Equivalents The Company considers all highly liquid investments purchased with original maturities of three months or less to be cash equivalents. The Company maintains cash balances at financial institutions that are insured by the Federal Deposit Insurance Corporation (“FDIC”) up to federally insured limits. At times balances may exceed FDIC insured limits. The Company has not experienced any losses in such accounts. |
Receivable [Policy Text Block] | Accounts Receivable and Allowance for Doubtful Accounts Accounts receivable consist primarily of invoices for maintenance and professional services. Full payment for software ordered by customers is primarily due in advance of ordering from the software supplier. Payments for maintenance and support plan renewals are due before the beginning of the maintenance period. Terms under our professional service agreements are generally 50% due in advance and the balance on completion of the services. The Company maintains an allowance for bad debt estimated by considering a number of factors, including the length of time the amounts are past due, the Company’s previous loss history and the customer’s current ability to pay its obligations. Accounts are written off against the allowance when deemed uncollectable. Recoveries of receivables previously written off are recorded as a reduction of bad debt expense when received. Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 326-20-30-2, Financial Instruments Credit Losses |
Goodwill and Intangible Assets, Goodwill, Policy [Policy Text Block] | Goodwill |
Software to be Sold, Leased, or Otherwise Marketed, Policy [Policy Text Block] | Capitalization of Proprietary Developed Software Software development costs are accounted for in accordance with the ASC 985-20, Software Costs of Software to be Sold, Leased or Marketed |
Business Combinations Policy [Policy Text Block] | Business Combinations We account for business combinations under the acquisition method of accounting. This method requires the recording of acquired assets and assumed liabilities at their acquisition date fair values. The excess of the purchase price over the fair value of assets acquired and liabilities assumed is recorded as goodwill. Results of operations related to business combinations are included prospectively beginning with the date of acquisition and transaction costs related to business combinations are recorded within general and administrative expenses. |
Impairment or Disposal of Long-Lived Assets, Including Intangible Assets, Policy [Policy Text Block] | Definite Lived Intangible Assets and Long-lived Assets Purchased intangible assets are recorded at fair value using an independent valuation at the date of acquisition and are amortized over the useful lives of the asset using the straight-line amortization method. The Company assesses potential impairment of its intangible assets and other long-lived assets when there is evidence that recent events or changes in circumstances have made recovery of an asset’s carrying value unlikely. Factors the Company considers important, which may cause impairment include, among others, significant changes in the manner of use of the acquired asset, negative industry or economic trends, and significant underperformance relative to historical or projected operating results. No impairment losses were identified or recorded for the three and six months ended June 30, 2023 and 2022. |
Revenue [Policy Text Block] | Revenue Recognition The Company has elected the significant financing component practical expedient in accordance with ASC 606, Revenue from Contracts with Customers. The Company determines revenue recognition through the following 5 steps: ● Identify the contract with a customer; ● Identify the performance obligations in the contract; ● Determine the transaction price; ● Allocate the transaction price to the performance obligation in the contract; and ● Recognize revenue when or as the entity satisfies a performance obligation Software product revenue is recognized when the product is delivered to the customer and the Company’s performance obligation is fulfilled. Service revenue is recognized when the professional consulting, maintenance or other ancillary services are provided to the customer. Shipping and handling costs charged to customers are classified as revenue, and the shipping and handling costs incurred are included in cost of revenues. Components of revenue: For the Three Months Ending June 30, 2023 2022 Software revenue $ 3,298,021 $ 2,782,081 Professional consulting 4,556,214 3,147,702 Maintenance revenue 1,235,100 1,194,556 Ancillary service revenue 4,167,936 3,513,734 $ 13,257,271 $ 10,638,073 For the Six Months Ending June 30, 2023 2022 Software revenue $ 6,620,349 $ 5,393,043 Professional consulting 8,892,845 6,450,506 Maintenance revenue 2,618,069 2,542,556 Ancillary service revenue 8,253,746 7,275,812 $ 26,385,009 $ 21,661,917 |
Trade and Other Accounts Receivable, Unbilled Receivables, Policy [Policy Text Block] | Unbilled Services The Company recognizes revenue on its professional services as those services are performed. Unbilled services (contract assets) represent the revenue recognized but not yet invoiced. |
Long-Duration Contracts Revenue Recognition, Policy [Policy Text Block] | Deferred Revenues Deferred revenues consist of maintenance on proprietary products (contract liabilities), customer telephone support services (contract liabilities) and deposits for future consulting services that will be earned as such services are performed over the contractual or stated period, which generally ranges from three to twelve months. As of June 30, 2023, there was $372,520 in deferred maintenance revenues, $512,475 in deferred support service revenues and $2,478,659 in deposits for future consulting services. As of December 31, 2022, there was $460,709 in deferred maintenance, $472,266 in deferred support services, and $2,824,115 in deposits for future consulting services. |
Revenue from Contract with Customer [Policy Text Block] | Commissions Sales commissions relating to service revenues are considered incremental and recoverable costs of obtaining a project with our customer. These commissions are calculated based on estimated revenue to be generated over the life of the project. These costs are deferred and expensed as the service revenue is earned. Commission expense is included in selling and marketing expenses in the accompanying unaudited condensed consolidated statements of operations. |
Fair Value of Financial Instruments, Policy [Policy Text Block] | Fair Value of Financial Instruments The Company estimates that the fair value of all financial instruments at June 30, 2023 and December 31, 2022, as defined in ASC 852 “ Financial Instruments The carrying amounts reported in the unaudited condensed consolidated balance sheets as of June 30, 2023 and December 31, 2022 for cash, accounts receivable, and accounts payable approximate the fair value because of the immediate or short-term maturity of these financial instruments. For each reporting period we evaluate market conditions including available interest rates, credit spreads relative to our credit rating and liquidity in estimating the fair value of our debt. After considering such market conditions, we estimate that the fair value of debt approximates its carrying value. |
Deferred Charges, Policy [Policy Text Block] | Deferred Charges The Company defers expenses until such time that the expense is consumed and charged to expense at that time. Deferred charges represent expenses related to the merger (see Note 14) and will be charged against the proceeds when the merger is consummated. |
Lessee, Leases [Policy Text Block] | Leases The Company accounts for its leases in accordance with ASC 842, Leases The Company has assessed its contracts and concluded that its leases consist of finance and operating leases. Operating leases are included in operating lease right-of-use (ROU) assets, current portion of operating lease liabilities, and operating lease liabilities in the Company’s unaudited condensed consolidated balance sheets. ROU assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. As most of the Company’s leases do not provide an implicit rate, the Company determines an incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. The incremental borrowing rate represents a significant judgment that is based on an analysis of the Company’s credit rating, country risk, treasury and corporate bond yields, as well as comparison to the Company’s borrowing rate on its most recent loan. The Company uses the implicit rate when readily determinable. The operating lease ROU asset also includes any lease payments made and excludes lease incentives. Lease expense for lease payments is recognized on a straight-line basis over the lease term. The Company has lease agreements with lease and non-lease components, which are generally accounted for separately. The Company finances purchases of hardware and computer equipment through finance lease agreements. Finance lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at commencement date. |
Concentration Risk, Credit Risk, Policy [Policy Text Block] | Concentrations The Company maintains its cash with various institutions, which exceed federally insured limits throughout the year. At June 30, 2023 and December 31, 2022, the Company had cash on deposit of $6,030,908 and $7,050,862, respectively, in excess of the federally insured limits of $250,000. As of June 30, 2023, no one customer represented more than 10% of the total accounts receivable and unbilled services. As of December 31, 2022, no one customer represented more than 10% of the total accounts receivable and unbilled services. For the six months ended June 30, 2023 and 2022, the Company’s top ten customers accounted for 10% ($2,681,200) and 9% ($1,856,981), respectively, of total revenues. The Company does not rely on any one specific customer for any significant portion of its revenue. For the six months ended June 30, 2023 and 2022 purchases from one supplier through a “channel partner” agreement were approximately 14% and 14% of cost of revenues, respectively. The channel partner agreements are for a one-year term and automatically renew for an additional one-year term on the anniversary of the agreement’s effective date. As of June 30, 2023, one supplier represented approximately 22% of total accounts payable. For the year ended December 31, 2022, one supplier represented approximately 28% of total accounts payable. Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of accounts receivable and cash. As of June 30, 2023, the Company believes it has no significant risk related to its concentration of credit risk related to accounts receivable. |
Property, Plant and Equipment, Policy [Policy Text Block] | Property and Equipment Property and equipment is stated at cost, net of accumulated depreciation and amortization. Depreciation is computed using the straight-line method based upon the estimated useful lives of the assets, generally three to seven years. Maintenance and repairs that do not materially add to the value of the equipment nor appreciably prolong its life are charged to expense as incurred. When assets are retired or otherwise disposed of, the cost and related accumulated depreciation are removed from the accounts and the resulting gain or loss is included in the unaudited condensed consolidated statements of operations. |
Income Tax, Policy [Policy Text Block] | Income Taxes The Company accounts for income taxes using the asset and liability method described in ASC 740, “ Income Taxes Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes, as well as net operating loss carryforwards. Based on ASU 2015-17, all deferred tax assets or liabilities are classified as long-term. Valuation allowances are established against deferred tax assets if it is more likely than not that the assets will not be realized. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates or laws is recognized in operations in the period that includes the enactment date. The Company accounts for uncertainties in income taxes under ASC 740-10-50 which prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. ASC 740-10 requires that the Company determine whether the benefits of its tax positions are more-likely-than-not of being sustained upon audit based on the technical merits of the tax position. The Company recognizes the impact of an uncertain income tax position taken on its income tax return at the largest amount that is more-likely-than-not to be sustained upon audit by the relevant taxing authority. The Company has federal net operating loss (“NOL”) carryforwards which are subject to limitations under Section 382 of the Internal Revenue Code. The Company files income tax returns in the U.S. federal and state jurisdictions. Tax years 2019 to 2022 remain open to examination for both the U.S. federal and state jurisdictions. Despite the Company’s belief that its tax return positions are consistent with applicable tax laws, one or more positions may be challenged by taxing authorities. Settlement of any challenge can result in no change, a complete disallowance, or some partial adjustment reached through negotiations or litigation. Interest and penalties related to income tax matters, if applicable, will be recognized as income tax expense. There were no liabilities for uncertain tax positions at June 30, 2023 and December 31, 2022. |
Fair Value Measurement, Policy [Policy Text Block] | Fair Value Measurement The accounting standards define fair value and establish a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use on unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs that market participants would use in pricing the asset or liability developed based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company’s assumptions about the assumptions market participants would use in pricing the asset or liability developed based on the best information available in the circumstances. The hierarchy is as follows: Level 1: Quoted prices (unadjusted) in active markets that are accessible at the measurement date for assets or liabilities. The fair value hierarchy gives the highest priority to Level 1 inputs. Level 2: Observable prices that are based on inputs not quoted on active markets but corroborated by market data. Level 3: Unobservable inputs are used when little or no market data is available. The fair value hierarchy gives the lowest priority to Level 3 inputs. The Company’s current financial assets and liabilities approximate fair value due to their short-term nature and include cash, accounts receivable, accounts payable, and accrued liabilities. The carrying value of longer-term leases and debt obligations approximate fair value as their stated interest rates approximate the rates currently available. The Company’s goodwill and intangibles are measured at fair-value using Level 3 inputs at acquisition, as discussed in Notes 6 and 11. |
Share-Based Payment Arrangement [Policy Text Block] | Stock-Based Compensation Compensation expense related to share-based transactions, including employee stock options, is measured and recognized in the financial statements based on a determination of the fair value. The grant date fair value is determined using the Black-Scholes-Merton (“Black-Scholes”) pricing model. For employee stock options, the Company recognizes expense over the requisite service period on a straight-line basis (generally the vesting period of the equity grant). The Company’s option pricing model requires the input of highly subjective assumptions, including the expected stock price volatility and expected term. Any changes in these highly subjective assumptions significantly impact stock-based compensation expense. |
New Accounting Pronouncements, Policy [Policy Text Block] | Recently Adopted Authoritative Pronouncements In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses - Measurement of Credit Losses on Financial Instruments Recent Authoritative Pronouncements No other recently issued accounting pronouncements had or are expected to have a material impact on the Company’s unaudited condensed consolidated financial statements. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Accounting Policies [Abstract] | |
Disaggregation of Revenue [Table Text Block] | For the Three Months Ending June 30, 2023 2022 Software revenue $ 3,298,021 $ 2,782,081 Professional consulting 4,556,214 3,147,702 Maintenance revenue 1,235,100 1,194,556 Ancillary service revenue 4,167,936 3,513,734 $ 13,257,271 $ 10,638,073 For the Six Months Ending June 30, 2023 2022 Software revenue $ 6,620,349 $ 5,393,043 Professional consulting 8,892,845 6,450,506 Maintenance revenue 2,618,069 2,542,556 Ancillary service revenue 8,253,746 7,275,812 $ 26,385,009 $ 21,661,917 |
NET INCOME (LOSS) PER COMMON _2
NET INCOME (LOSS) PER COMMON SHARE (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted [Table Text Block] | For the three and six months ended June 30, 2023 and 2022, the average market prices for the periods ended are less than the exercise price of all the outstanding stock options, therefore, the inclusion of the stock options would be anti-dilutive. In addition, for the three and six months ended June 30, 2022, since the Company has a net loss, the effect of common stock equivalents is anti-dilutive, and, as such, common stock equivalents have been excluded from the calculation. Three Months Ended Three Months Ended June 30, 2023 June 30, 2022 Basic net income (loss) per share computation: Net income (loss) $ 343,361 $ (87,766 ) Weighted-average common shares outstanding 5,256,177 5,136,177 Basic net income (loss) per share $ 0.07 $ (0.02 ) Diluted net income (loss) per share computation: Net income (loss) per above $ 343,361 $ (87,766 ) Weighted-average common shares outstanding 5,256,177 5,136,177 Total adjusted weighted-average shares 5,256,177 5,136,177 Diluted net income (loss) per share $ 0.07 $ (0.02 ) Six Months Ended Six Months Ended June 30, 2023 June 30, 2022 Basic net income (loss) per share computation: Net income (loss) $ 620,852 $ (128,422 ) Weighted-average common shares outstanding 5,256,177 5,136,177 Basic net income (loss) per share $ 0.12 $ (0.03 ) Diluted net income (loss): Net income (loss) $ 620,852 $ (128,422 ) Weighted-average common shares outstanding 5,256,177 5,136,177 Total adjusted weighted-average shares 5,256,177 5,136,177 Diluted net income (loss)per share $ 0.12 $ (0.03 ) |
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share [Table Text Block] | The following table summarizes securities that, if exercised, would have an anti-dilutive effect on income (loss) per share. Three Months Ended June 30, 2023 Three Months Ended June 30, 2022 Stock options 158,420 165,620 Total potential dilutive securities not included in income (loss) income per share 158,420 165,620 Six Months Ended June 30, 2023 Six Months Ended June 30, 2022 Stock options 158,420 162,020 Total potential dilutive securities not included in (loss) income per share 158,420 162,020 |
ALLOWANCE FOR EXPECTED CREDIT_2
ALLOWANCE FOR EXPECTED CREDIT LOSSES (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Disclosure Text Block Supplement [Abstract] | |
Accounts Receivable, Allowance for Credit Loss [Table Text Block] | The following table represents the roll-forward of the allowance for doubtful accounts for the six months ended June 30, 2023 and the year ended December 31, 2022: June 30, 2023 December 31, 2022 Balance at beginning of period $ 490,311 $ 330,311 Current period provision for expected losses 25,000 170,178 Write-offs (92,640 ) (10,178 ) Balance at end of period $ 422,671 $ 490,311 |
PROPERTY AND EQUIPMENT (Tables)
PROPERTY AND EQUIPMENT (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
PROPERTY AND EQUIPMENT (Tables) [Line Items] | |
Property, Plant and Equipment [Table Text Block] | Property and equipment is summarized as follows: June 30, 2023 December 31, 2022 Leasehold improvements $ 165,701 $ 165,701 Equipment, furniture and fixtures 3,845,435 3,821,575 4,011,136 3,987,276 Less: Accumulated depreciation and amortization (3,454,032 ) (3,275,962 ) Property and equipment, net $ 557,104 $ 711,314 |
Assets Held under Capital Leases [Member] | |
PROPERTY AND EQUIPMENT (Tables) [Line Items] | |
Property, Plant and Equipment [Table Text Block] | Property and equipment under finance leases (included in Note 8) are summarized as follows: June 30, 2023 December 31, 2022 Equipment, furniture, and fixtures $ 1,256,092 $ 1,256,092 Less: Accumulated amortization (823,898 ) (716,743 ) Property and equipment, net $ 432,194 $ 539,349 |
INTANGIBLE ASSETS (Tables)
INTANGIBLE ASSETS (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Finite-Lived Intangible Assets [Table Text Block] | The components of intangible assets are as follows: June 30, 2023 December 31, 2022 Estimated Useful Lives Proprietary developed software $ 390,082 $ 390,082 5 –7 Intellectual property, customer list, and acquired contracts 7,743,283 7,743,283 5 –15 Total intangible assets 8,133,365 8,133,365 Less: accumulated amortization (4,191,934 ) (3,868,012 ) $ 3,941,431 $ 4,265,353 |
Schedule of Finite-Lived Intangible Assets, Future Amortization Expense [Table Text Block] | The Company expects future amortization expense to be the following: Amortization Remainder of 2023 $ 323,922 2024 647,844 2025 644,367 2026 633,165 2027 619,516 Thereafter 1,072,617 Total $ 3,941,431 |
LONG-TERM AND RELATED PARTY D_2
LONG-TERM AND RELATED PARTY DEBT (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Line Of Credit And Term Loan Abstract | |
Schedule of Maturities of Long-Term Debt [Table Text Block] | At June 30, 2023, future payments of long-term debt are as follows: Remainder of 2023 $ 361,062 2024 360,091 2025 258,736 2026 52,187 Total $ 1,032,076 |
FINANCE LEASE OBLIGATIONS (Tabl
FINANCE LEASE OBLIGATIONS (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
FINANCE LEASE OBLIGATIONS (Tables) [Line Items] | |
Finance Lease, Liability, to be Paid, Maturity [Table Text Block] | At June 30, 2023 future payments under finance leases are as follows: June 30, 2023 Remainder of 2023 $ 122,905 2024 176,686 2025 115,080 2026 115,080 2027 47,950 Total minimum lease payments 577,701 Less amounts representing interest (70,046 ) Present value of net minimum lease payments 507,655 Less current portion (202,420 ) Long-term finance lease obligation $ 305,235 |
Finance and Capital Lease Obligations [Member] | |
FINANCE LEASE OBLIGATIONS (Tables) [Line Items] | |
Lease, Cost [Table Text Block] | The Company has entered into lease commitments for equipment that meet the requirements for capitalization. The equipment has been capitalized and is included in property and equipment in the accompanying unaudited condensed consolidated balance sheets. The weighted average interest rate as of June 30, 2023 was 7.24% and the following weighted-average lease term: June 30, 2023 December 31, 2022 Weighted average remaining lease term 3.15 3.44 |
OPERATING LEASE LIABILITY (Tabl
OPERATING LEASE LIABILITY (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
OPERATING LEASE LIABILITY (Tables) [Line Items] | |
Lessee, Operating Lease, Liability, to be Paid, Maturity [Table Text Block] | The following table reconciles the undiscounted future minimum lease payments (displayed by year and in the aggregate) under noncancelable operating leases with terms of more than one year to the total lease liabilities recognized on the unaudited condensed consolidated balance sheet as of June 30, 2023: Remainder 2023 $ 188,485 2024 197,163 2025 72,058 2026 30,786 Total undiscounted future minimum lease payments 488,492 Less: Difference between undiscounted lease payments and discounted lease liabilities (23,450 ) Total operating lease liabilities 465,042 Less current portion (302,739 ) Long-term operating lease liabilities $ 162,303 |
Operating Lease [Member] | |
OPERATING LEASE LIABILITY (Tables) [Line Items] | |
Lease, Cost [Table Text Block] | The Company's weighted average remaining lease term for operating leases as of June 30, 2023 and December 31, 2022 are as follows: June 30, 2023 December 31, 2022 Weighted average remaining lease term 1.84 1.19 |
EQUITY (Tables)
EQUITY (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Stockholders' Equity Note [Abstract] | |
Share-Based Payment Arrangement, Option, Activity [Table Text Block] | A summary of the status of the Company’s stock option plans for the six months ended June 30, 2023 and the year ended December 31, 2022 and changes during the periods are presented below (in number of options): Number of Options Average Exercise Price Outstanding options at January 1, 2022 165,620 $ 6.256 Options granted - - Options canceled/forfeited (7,200 ) $ 6.530 Outstanding options at December 31, 2022 158,420 $ 6.245 Options granted - - Options canceled/forfeited - $ - Outstanding options at June 30, 2023 158,420 $ 6.245 |
BUSINESS COMBINATION (Tables)
BUSINESS COMBINATION (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Business Combinations [Abstract] | |
Schedule of Business Acquisitions, by Acquisition [Table Text Block] | The following summarizes the purchase price allocation for all prior year and current year’s acquisitions: 2022 Purchase DTS Cash consideration $ 500,000 Note payable 835,000 Total purchase price $ 1,335,000 Customer list $ 1,207,000 Goodwill 128,000 Total assets acquired 1,335,000 Deferred revenue - Net assets acquired $ 1,335,000 |
SUPPLEMENTAL SCHEDULE OF NON-_2
SUPPLEMENTAL SCHEDULE OF NON-CASH INVESTING AND FINANCING ACTIVITIES (Details) - USD ($) | 6 Months Ended | |||||||||
Apr. 15, 2022 | Jan. 22, 2022 | Jan. 19, 2022 | Jan. 01, 2022 | May 01, 2021 | Jun. 30, 2023 | Jun. 30, 2022 | Jun. 02, 2023 | Mar. 31, 2023 | Dec. 31, 2022 | |
SUPPLEMENTAL SCHEDULE OF NON-CASH INVESTING AND FINANCING ACTIVITIES (Details) [Line Items] | ||||||||||
Operating Lease, Right-of-Use Asset | $ 465,042 | $ 108,330 | $ 328,562 | |||||||
Payments to Acquire Businesses, Gross | $ 500,000 | $ 0 | $ 150,000 | |||||||
Debt Instrument, Face Amount | $ 835,000 | |||||||||
Debt Instrument, Interest Rate, Stated Percentage | 3.25% | |||||||||
Liabilities Assumed | $ 73,672 | |||||||||
Lease Obligation Incurred | $ 494,383 | |||||||||
Digital Fortress, Inc. [Member] | ||||||||||
SUPPLEMENTAL SCHEDULE OF NON-CASH INVESTING AND FINANCING ACTIVITIES (Details) [Line Items] | ||||||||||
Operating Lease, Right-of-Use Asset | $ 109,840 | |||||||||
Cologix USA Inc [Member] | ||||||||||
SUPPLEMENTAL SCHEDULE OF NON-CASH INVESTING AND FINANCING ACTIVITIES (Details) [Line Items] | ||||||||||
Operating Lease, Right-of-Use Asset | $ 106,471 | |||||||||
Dynamic Tech Services, Inc (DTS”) [Member] | ||||||||||
SUPPLEMENTAL SCHEDULE OF NON-CASH INVESTING AND FINANCING ACTIVITIES (Details) [Line Items] | ||||||||||
Business Combination, Consideration Transferred | $ 1,335,000 | |||||||||
Payments to Acquire Businesses, Gross | 500,000 | |||||||||
Business Combination, Consideration Transferred, Liabilities Incurred | 835,000 | |||||||||
Debt Instrument, Face Amount | $ 835,000 | |||||||||
Debt Instrument, Interest Rate, Stated Percentage | 3.25% | |||||||||
NEO3, LLC ("NEO3") [Member] | ||||||||||
SUPPLEMENTAL SCHEDULE OF NON-CASH INVESTING AND FINANCING ACTIVITIES (Details) [Line Items] | ||||||||||
Business Combination, Consideration Transferred | 225,000 | |||||||||
Payments to Acquire Businesses, Gross | $ 150,000 | |||||||||
Debt Instrument, Face Amount | $ 75,000 | |||||||||
Debt Instrument, Interest Rate, Stated Percentage | 2% | |||||||||
PeopleSense, Inc. ("PSI") [Member] | ||||||||||
SUPPLEMENTAL SCHEDULE OF NON-CASH INVESTING AND FINANCING ACTIVITIES (Details) [Line Items] | ||||||||||
Payments to Acquire Businesses, Gross | 150,000 | $ 145,703 | ||||||||
Debt Instrument, Face Amount | $ 75,000 | $ 450,000 | ||||||||
Debt Instrument, Interest Rate, Stated Percentage | 2% | 2% |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) - USD ($) | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | Dec. 31, 2022 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) [Line Items] | |||||
Cash, Uninsured Amount | $ 6,030,908 | $ 6,030,908 | $ 7,050,862 | ||
Cash, FDIC Insured Amount | 250,000 | ||||
Revenues | $ 13,257,271 | $ 10,638,073 | $ 26,385,009 | $ 21,661,917 | |
Minimum [Member] | |||||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) [Line Items] | |||||
Property, Plant and Equipment, Useful Life | 3 years | 3 years | |||
Maximum [Member] | |||||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) [Line Items] | |||||
Property, Plant and Equipment, Useful Life | 7 years | 7 years | |||
Deferred Maintenance [Member] | |||||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) [Line Items] | |||||
Deferred Revenue | $ 372,520 | $ 372,520 | 460,709 | ||
Deferred Support Services [Member] | |||||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) [Line Items] | |||||
Deferred Revenue | 512,475 | 512,475 | 472,266 | ||
Deposits for Future Services [Member] | |||||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) [Line Items] | |||||
Deferred Revenue | $ 2,478,659 | $ 2,478,659 | $ 2,824,115 | ||
Cost of Goods and Service Benchmark [Member] | Supplier Concentration Risk [Member] | |||||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) [Line Items] | |||||
Purchase Commitment, Description | The channel partner agreements are for a one-year term and automatically renew for an additional one-year term on the anniversary of the agreement’s effective date. | ||||
Ten Customers [Member] | Revenue Benchmark [Member] | Customer Concentration Risk [Member] | |||||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) [Line Items] | |||||
Concentration Risk, Percentage | 10% | 9% | |||
Revenues | $ 2,681,200 | $ 1,856,981 | |||
One Supplier [Member] | Cost of Goods and Service Benchmark [Member] | Supplier Concentration Risk [Member] | |||||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) [Line Items] | |||||
Concentration Risk, Percentage | 14% | 14% | |||
One Supplier [Member] | Concentration Risk, Accounts Payable [Member] | Supplier Concentration Risk [Member] | |||||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) [Line Items] | |||||
Concentration Risk, Percentage | 22% | 28% |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) - Disaggregation of Revenue - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Disaggregation of Revenue [Line Items] | ||||
Revenue | $ 13,257,271 | $ 10,638,073 | $ 26,385,009 | $ 21,661,917 |
Software [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 3,298,021 | 2,782,081 | 6,620,349 | 5,393,043 |
Consulting Service Revenue [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 4,556,214 | 3,147,702 | 8,892,845 | 6,450,506 |
Maintenance [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 1,235,100 | 1,194,556 | 2,618,069 | 2,542,556 |
Ancillary Revenue [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | $ 4,167,936 | $ 3,513,734 | $ 8,253,746 | $ 7,275,812 |
NET INCOME (LOSS) PER COMMON _3
NET INCOME (LOSS) PER COMMON SHARE (Details) - Schedule of Earnings Per Share, Basic and Diluted - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Basic net income (loss) per share computation: | ||||
Net income (loss) (in Dollars) | $ 343,361 | $ (87,766) | $ 620,852 | $ (128,422) |
Weighted-average common shares outstanding | 5,256,177 | 5,136,177 | 5,256,177 | 5,136,177 |
Basic net income (loss) per share (in Dollars per share) | $ 0.07 | $ (0.02) | $ 0.12 | $ (0.03) |
Diluted net income (loss) per share computation: | ||||
Net income (loss) per above (in Dollars) | $ 343,361 | $ (87,766) | $ 620,852 | $ (128,422) |
Weighted-average common shares outstanding | 5,256,177 | 5,136,177 | 5,256,177 | 5,136,177 |
Total adjusted weighted-average shares | 5,256,177 | 5,136,177 | 5,256,177 | 5,136,177 |
Diluted net income (loss) per share (in Dollars per share) | $ 0.07 | $ (0.02) | $ 0.12 | $ (0.03) |
NET INCOME (LOSS) PER COMMON _4
NET INCOME (LOSS) PER COMMON SHARE (Details) - Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share - shares | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 158,420 | 165,620 | 158,420 | 162,020 |
Share-Based Payment Arrangement, Option [Member] | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 158,420 | 165,620 | 158,420 | 162,020 |
ALLOWANCE FOR EXPECTED CREDIT_3
ALLOWANCE FOR EXPECTED CREDIT LOSSES (Details) - Accounts Receivable, Allowance for Credit Loss - USD ($) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2023 | Dec. 31, 2022 | |
Accounts Receivable Allowance For Credit Loss Abstract | ||
Balance | $ 490,311 | $ 330,311 |
Current period provision for expected losses | 25,000 | 170,178 |
Write-offs | (92,640) | (10,178) |
Balance | $ 422,671 | $ 490,311 |
PROPERTY AND EQUIPMENT (Details
PROPERTY AND EQUIPMENT (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Property, Plant and Equipment [Abstract] | ||||
Depreciation, Depletion and Amortization | $ 85,529 | $ 96,582 | $ 178,070 | $ 195,007 |
PROPERTY AND EQUIPMENT (Detail
PROPERTY AND EQUIPMENT (Details) - Schedule of Property and Equipment - USD ($) | Jun. 30, 2023 | Dec. 31, 2022 |
Property, Plant and Equipment [Line Items] | ||
Property and Equipment | $ 4,011,136 | $ 3,987,276 |
Less: Accumulated depreciation | (3,454,032) | (3,275,962) |
Property and equipment, net | 557,104 | 711,314 |
Leasehold Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and Equipment | 165,701 | 165,701 |
Furniture and Fixtures [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and Equipment | $ 3,845,435 | $ 3,821,575 |
PROPERTY AND EQUIPMENT (Deta_2
PROPERTY AND EQUIPMENT (Details) - Property, Plant and Equipment - Assets Held under Capital Leases [Member] - USD ($) | Jun. 30, 2023 | Dec. 31, 2022 |
Property, Plant and Equipment [Line Items] | ||
Equipment, furniture, and fixtures | $ 1,256,092 | $ 1,256,092 |
Less: Accumulated amortization | (823,898) | (716,743) |
Property and equipment, net | $ 432,194 | $ 539,349 |
INTANGIBLE ASSETS (Details)
INTANGIBLE ASSETS (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||||
Jan. 19, 2022 | Jan. 01, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
INTANGIBLE ASSETS (Details) [Line Items] | ||||||
Asset Acquisition, Consideration Transferred | $ 1,335,000 | |||||
Payments to Acquire Businesses, Gross | 500,000 | $ 0 | $ 150,000 | |||
Debt Instrument, Face Amount | $ 835,000 | |||||
Debt Instrument, Interest Rate, Stated Percentage | 3.25% | |||||
Amortization of Intangible Assets | $ 161,961 | $ 186,365 | $ 323,922 | $ 376,822 | ||
NEO3, LLC ("NEO3") [Member] | ||||||
INTANGIBLE ASSETS (Details) [Line Items] | ||||||
Payments to Acquire Businesses, Gross | $ 150,000 | |||||
Debt Instrument, Face Amount | $ 75,000 | |||||
Debt Instrument, Interest Rate, Stated Percentage | 2% | |||||
Debt Instrument, Term | 36 months | |||||
Debt Instrument, Periodic Payment | $ 2,148 | |||||
Finite-Lived Intangible Asset, Useful Life | 7 years |
INTANGIBLE ASSETS (Details) - S
INTANGIBLE ASSETS (Details) - Schedule of Finite-Lived Intangible Assets - USD ($) | Jun. 30, 2023 | Dec. 31, 2022 |
Finite-Lived Intangible Assets [Line Items] | ||
Intangible asset, gross | $ 8,133,365 | $ 8,133,365 |
Less: accumulated amortization | (4,191,934) | (3,868,012) |
Intangible asset, net | 3,941,431 | 4,265,353 |
Computer Software, Intangible Asset [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible asset, gross | $ 390,082 | 390,082 |
Computer Software, Intangible Asset [Member] | Minimum [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Estimated Useful Life | 5 years | |
Computer Software, Intangible Asset [Member] | Maximum [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Estimated Useful Life | 7 years | |
Intellectual property, customer list, and acquired contracts [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible asset, gross | $ 7,743,283 | $ 7,743,283 |
Intellectual property, customer list, and acquired contracts [Member] | Minimum [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Estimated Useful Life | 5 years | |
Intellectual property, customer list, and acquired contracts [Member] | Maximum [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Estimated Useful Life | 15 years |
INTANGIBLE ASSETS (Details) -_2
INTANGIBLE ASSETS (Details) - Schedule of Finite-Lived Intangible Assets, Future Amortization Expense - USD ($) | Jun. 30, 2023 | Dec. 31, 2022 |
Schedule Of Finite Lived Intangible Assets Future Amortization Expense Abstract | ||
Remainder of 2023 | $ 323,922 | |
2024 | 647,844 | |
2025 | 644,367 | |
2026 | 633,165 | |
2027 | 619,516 | |
Thereafter | 1,072,617 | |
Total | $ 3,941,431 | $ 4,265,353 |
LONG-TERM AND RELATED PARTY D_3
LONG-TERM AND RELATED PARTY DEBT (Details) | 6 Months Ended | 12 Months Ended | ||||||||||||
Jul. 01, 2023 USD ($) | Aug. 04, 2022 USD ($) | Jan. 22, 2022 USD ($) | Jan. 19, 2022 USD ($) | Jan. 01, 2022 USD ($) | Jul. 31, 2021 USD ($) | May 01, 2021 USD ($) | Apr. 01, 2021 USD ($) | Dec. 01, 2020 USD ($) | Oct. 01, 2020 USD ($) | Jul. 31, 2020 USD ($) | Jun. 30, 2023 USD ($) | Jun. 30, 2022 USD ($) | Dec. 31, 2022 USD ($) | |
LONG-TERM AND RELATED PARTY DEBT (Details) [Line Items] | ||||||||||||||
Payments to Acquire Businesses, Gross | $ 500,000 | $ 0 | $ 150,000 | |||||||||||
Debt Instrument, Face Amount | $ 835,000 | |||||||||||||
Debt Instrument, Interest Rate, Stated Percentage | 3.25% | |||||||||||||
Long-Term Debt | 1,032,076 | |||||||||||||
Notes Payable, Noncurrent | 1,032,076 | $ 1,454,493 | ||||||||||||
Debt, Current | 580,402 | 783,479 | ||||||||||||
Business Software Solutions ("BSS") [Member] | ||||||||||||||
LONG-TERM AND RELATED PARTY DEBT (Details) [Line Items] | ||||||||||||||
Payments to Acquire Businesses, Gross | $ 230,000 | |||||||||||||
Debt Instrument, Interest Rate, Stated Percentage | 2% | |||||||||||||
Debt Instrument, Term | 60 months | |||||||||||||
Long-Term Debt | 117,872 | 140,748 | ||||||||||||
Debt Instrument, Periodic Payment | $ 4,031 | |||||||||||||
CT-Solution ("CTS") [Member] | ||||||||||||||
LONG-TERM AND RELATED PARTY DEBT (Details) [Line Items] | ||||||||||||||
Payments to Acquire Businesses, Gross | $ 130,000 | |||||||||||||
Debt Instrument, Interest Rate, Stated Percentage | 2% | |||||||||||||
Debt Instrument, Term | 36 months | |||||||||||||
Debt Instrument, Periodic Payment | $ 3,724 | |||||||||||||
Prairie Technology Solutions Group, LLC ("PT") [Member] | ||||||||||||||
LONG-TERM AND RELATED PARTY DEBT (Details) [Line Items] | ||||||||||||||
Payments to Acquire Businesses, Gross | $ 185,000 | 500,000 | ||||||||||||
Number of Notes | 3 | |||||||||||||
Debt Instrument, Face Amount | $ 103,333 | |||||||||||||
Debt Instrument, Interest Rate, Stated Percentage | 4% | |||||||||||||
Repayments of Convertible Debt | $ 103,333 | $ 111,924 | $ 107,543 | |||||||||||
Long-Term Debt | 103,333 | 103,333 | ||||||||||||
Business Combination, Consideration Transferred | 1,335,000 | |||||||||||||
Prairie Technology Solutions Group, LLC ("PT") [Member] | Prairie Tech Note 1 [Member] | ||||||||||||||
LONG-TERM AND RELATED PARTY DEBT (Details) [Line Items] | ||||||||||||||
Debt Instrument, Term | 1 year | |||||||||||||
Prairie Technology Solutions Group, LLC ("PT") [Member] | Prairie Tech Note 2 [Member] | ||||||||||||||
LONG-TERM AND RELATED PARTY DEBT (Details) [Line Items] | ||||||||||||||
Debt Instrument, Term | 2 years | |||||||||||||
Prairie Technology Solutions Group, LLC ("PT") [Member] | Prairie Tech Note 3 [Member] | ||||||||||||||
LONG-TERM AND RELATED PARTY DEBT (Details) [Line Items] | ||||||||||||||
Debt Instrument, Term | 3 years | |||||||||||||
Computer Management Services, LLC ("CMS") [Member] | ||||||||||||||
LONG-TERM AND RELATED PARTY DEBT (Details) [Line Items] | ||||||||||||||
Payments to Acquire Businesses, Gross | $ 410 | |||||||||||||
Debt Instrument, Face Amount | $ 170,000 | |||||||||||||
Debt Instrument, Interest Rate, Stated Percentage | 2% | |||||||||||||
Debt Instrument, Term | 36 months | |||||||||||||
Long-Term Debt | 36,896 | 58,741 | ||||||||||||
Customer Deposits, Current | $ 50,115 | |||||||||||||
Prepaid Expense, Current | 67,073 | |||||||||||||
Business Combination, Consideration Transferred | 287,598 | |||||||||||||
Debt Instrument, Periodic Payment | $ 4,869 | |||||||||||||
ProductiveTech, Inc. (PTI) [Member] | Notes Payable, Other Payables [Member] | ||||||||||||||
LONG-TERM AND RELATED PARTY DEBT (Details) [Line Items] | ||||||||||||||
Long-Term Debt | 19,396 | 48,249 | ||||||||||||
PeopleSense, Inc. ("PSI") [Member] | ||||||||||||||
LONG-TERM AND RELATED PARTY DEBT (Details) [Line Items] | ||||||||||||||
Payments to Acquire Businesses, Gross | $ 150,000 | $ 145,703 | ||||||||||||
Debt Instrument, Face Amount | $ 75,000 | $ 450,000 | ||||||||||||
Debt Instrument, Interest Rate, Stated Percentage | 2% | 2% | ||||||||||||
Debt Instrument, Term | 36 months | |||||||||||||
Long-Term Debt | 140,373 | 215,863 | ||||||||||||
Debt Instrument, Periodic Payment | $ 12,889 | |||||||||||||
Proceeds from Deposits from Customers | $ 99,938 | |||||||||||||
Dynamic Tech Services, Inc (DTS”) [Member] | ||||||||||||||
LONG-TERM AND RELATED PARTY DEBT (Details) [Line Items] | ||||||||||||||
Payments to Acquire Businesses, Gross | $ 500,000 | |||||||||||||
Debt Instrument, Face Amount | $ 835,000 | |||||||||||||
Debt Instrument, Interest Rate, Stated Percentage | 3.25% | |||||||||||||
Long-Term Debt | 574,062 | 835,000 | ||||||||||||
Business Combination, Consideration Transferred | $ 1,335,000 | |||||||||||||
Business Combination, Provisional Information, Initial Accounting Incomplete, Nature of Adjustments | In the event that subscription renewal revenue received from DTS Customers during the one-year period immediately following the Effective Date was less than 95% of the subscription renewal revenue received by DTS from DTS Customers during the one-year period immediately preceding the Effective Date, the principal amount of the Note would be reduced. The measuring period for any downward adjustment would be as of the one-year anniversary of the Effective Date. Notwithstanding the foregoing, under no circumstances would the principal amount of the Note be reduced by reason of such downward adjustment by more than $150,000 (i.e., to a principal amount below $685,000). | |||||||||||||
NEO3, LLC ("NEO3") [Member] | ||||||||||||||
LONG-TERM AND RELATED PARTY DEBT (Details) [Line Items] | ||||||||||||||
Payments to Acquire Businesses, Gross | $ 150,000 | |||||||||||||
Debt Instrument, Face Amount | $ 75,000 | |||||||||||||
Debt Instrument, Interest Rate, Stated Percentage | 2% | |||||||||||||
Debt Instrument, Term | 36 months | |||||||||||||
Long-Term Debt | $ 40,144 | $ 52,559 | ||||||||||||
Business Combination, Consideration Transferred | $ 225,000 | |||||||||||||
Debt Instrument, Periodic Payment | $ 2,148 |
LONG-TERM AND RELATED PARTY D_4
LONG-TERM AND RELATED PARTY DEBT (Details) - Schedule of Maturities of Long-term Debt | Jun. 30, 2023 USD ($) |
Schedule Of Maturities Of Long Term Debt Abstract | |
Remainder of 2023 | $ 361,062 |
2024 | 360,091 |
2025 | 258,736 |
2026 | 52,187 |
Total | $ 1,032,076 |
FINANCE LEASE OBLIGATIONS (Deta
FINANCE LEASE OBLIGATIONS (Details) | Jun. 30, 2023 |
Disclosure Text Block [Abstract] | |
Finance Lease, Weighted Average Discount Rate, Percent | 7.24% |
FINANCE LEASE OBLIGATIONS (De_2
FINANCE LEASE OBLIGATIONS (Details) - Lease, Cost | Jun. 30, 2023 | Dec. 31, 2022 |
Lease, Cost [Abstract] | ||
Weighted average remaining lease terms | 3 years 1 month 24 days | 3 years 5 months 8 days |
FINANCE LEASE OBLIGATIONS (De_3
FINANCE LEASE OBLIGATIONS (Details) - Finance Lease, Liability, Fiscal Year Maturity - USD ($) | Jun. 30, 2023 | Dec. 31, 2022 |
Finance Lease Liability Fiscal Year Maturity Abstract | ||
Remainder of 2023 | $ 122,905 | |
2024 | 176,686 | |
2025 | 115,080 | |
2026 | 115,080 | |
2027 | 47,950 | |
Total minimum lease payments | 577,701 | |
Less amounts representing interest | (70,046) | |
Present value of net minimum lease payments | 507,655 | |
Less current portion | (202,420) | $ (214,990) |
Long-term finance lease obligation | $ 305,235 | $ 401,453 |
OPERATING LEASE LIABILITY (Deta
OPERATING LEASE LIABILITY (Details) | 3 Months Ended | 6 Months Ended | |||
Jun. 02, 2023 USD ($) | Jun. 30, 2023 USD ($) | Jun. 30, 2022 USD ($) | Jun. 30, 2023 USD ($) | Jun. 30, 2022 USD ($) | |
OPERATING LEASE LIABILITY (Details) [Line Items] | |||||
Number of Locations of Office Space Leases | 4 | ||||
Operating Lease, Expense | $ 103,213 | $ 123,086 | $ 213,080 | $ 258,217 | |
Right-of-Use Asset Obtained in Exchange for Operating Lease Liability | $ 108,330 | ||||
Operating Lease, Weighted Average Discount Rate, Percent | 4.77% | 4.77% | |||
Minimum [Member] | |||||
OPERATING LEASE LIABILITY (Details) [Line Items] | |||||
Operating Lease, Expense | $ 3,180 | ||||
Maximum [Member] | |||||
OPERATING LEASE LIABILITY (Details) [Line Items] | |||||
Operating Lease, Expense | 10,279 | ||||
Digital Fortress, Inc. [Member] | |||||
OPERATING LEASE LIABILITY (Details) [Line Items] | |||||
Increase (Decrease) in Operating Lease Liability | 109,840 | ||||
Cologix USA Inc [Member] | |||||
OPERATING LEASE LIABILITY (Details) [Line Items] | |||||
Increase (Decrease) in Operating Lease Liability | $ 106,471 |
OPERATING LEASE LIABILITY (De_2
OPERATING LEASE LIABILITY (Details) - Lease, Cost | Jun. 30, 2023 | Dec. 31, 2022 |
Lease, Cost [Abstract] | ||
Weighted average remaining lease term | 1 year 10 months 2 days | 1 year 2 months 8 days |
OPERATING LEASE LIABILITY (De_3
OPERATING LEASE LIABILITY (Details) - Lessee, Operating Lease, Liability, Maturity - USD ($) | Jun. 30, 2023 | Dec. 31, 2022 |
Lessee Operating Lease Liability Maturity Abstract | ||
Remainder 2023 | $ 188,485 | |
2024 | 197,163 | |
2025 | 72,058 | |
2026 | 30,786 | |
Total undiscounted future minimum lease payments | 488,492 | |
Less: Difference between undiscounted lease payments and discounted lease liabilities | (23,450) | |
Total operating lease liabilities | 465,042 | |
Less current portion | (302,739) | $ (268,345) |
Long-term operating lease liabilities | $ 162,303 | $ 60,217 |
EQUITY (Details)
EQUITY (Details) - USD ($) | 3 Months Ended | 6 Months Ended | 12 Months Ended | |||
Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | Dec. 31, 2022 | Nov. 05, 2021 | Oct. 10, 2019 | |
Stockholders' Equity Note [Abstract] | ||||||
Stock Repurchase Program, Remaining Number of Shares Authorized to be Repurchased (in Shares) | 5,000,000 | 2,000,000 | ||||
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Grants in Period, Gross (in Shares) | 0 | 0 | ||||
Share-Based Payment Arrangement, Expense | $ 45,945 | $ 41,497 | $ 91,890 | |||
Share-Based Payment Arrangement, Nonvested Award, Option, Cost Not yet Recognized, Amount | $ 41,497 |
EQUITY (Details) - Share-Based
EQUITY (Details) - Share-Based Payment Arrangement, Option, Activity - $ / shares | 6 Months Ended | 12 Months Ended |
Jun. 30, 2023 | Dec. 31, 2022 | |
Share Based Payment Arrangement Option Activity Abstract | ||
Outstanding, Number of Options | 158,420 | 165,620 |
Outstanding, Average Exercise Price | $ 6.245 | $ 6.256 |
Options granted, Number of Options | 0 | 0 |
Options granted, Average Exercise Price | $ 0 | $ 0 |
Options canceled/forfeited, Number of Options | 0 | (7,200) |
Options canceled/forfeited, Average Exercise Price | $ 0 | $ 6.53 |
Outstanding, Number of Options | 158,420 | 158,420 |
Outstanding, Average Exercise Price | $ 6.245 | $ 6.245 |
BUSINESS COMBINATION (Details)
BUSINESS COMBINATION (Details) - Dynamic Tech Services, Inc (DTS”) [Member] | Jan. 01, 2022 USD ($) |
BUSINESS COMBINATION (Details) [Line Items] | |
Business Combination, Consideration Transferred | $ 1,335,000 |
Payments to Acquire Businesses, Gross | 500,000 |
Debt Instrument, Face Amount | $ 835,000 |
Debt Instrument, Interest Rate, Stated Percentage | 3.25% |
Goodwill | $ 128,000 |
Customer Lists [Member] | |
BUSINESS COMBINATION (Details) [Line Items] | |
Business Combination, Consideration Transferred | $ 1,207,000 |
BUSINESS COMBINATION (Details)
BUSINESS COMBINATION (Details) - Schedule of Business Acquisitions, by Acquisition - Prairie Technology Solutions Group, LLC ("PT") [Member] - USD ($) | 12 Months Ended | |
Jul. 31, 2020 | Dec. 31, 2022 | |
Business Acquisition [Line Items] | ||
Cash consideration | $ 185,000 | $ 500,000 |
Note payable | 835,000 | |
Total purchase price | 1,335,000 | |
Customer List | 1,207,000 | |
Goodwill | 128,000 | |
Total assets acquired | 1,335,000 | |
Deferred revenue | 0 | |
Net assets acquired | $ 1,335,000 |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | Dec. 31, 2022 | |
Income Tax Disclosure [Abstract] | |||||
Operating Loss Carryforwards | $ 5,000,000 | $ 5,000,000 | |||
Deferred Tax Assets, Net of Valuation Allowance | 886,000 | 886,000 | $ 1,106,000 | ||
Income Tax Expense (Benefit) | $ 95,481 | $ (15,280) | $ 170,272 | $ (13,192) |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) - USD ($) | Jun. 30, 2023 | Dec. 31, 2022 |
Related Party Transactions [Abstract] | ||
Notes Payable | $ 103,333 | $ 103,333 |
MERGER (Details)
MERGER (Details) - USD ($) | Jul. 11, 2023 | Sep. 29, 2022 | Jun. 30, 2023 | Dec. 31, 2022 |
MERGER (Details) [Line Items] | ||||
Termination Fee | $ 5,000,000 | |||
Common Stock, Par or Stated Value Per Share (in Dollars per share) | $ 0.00001 | $ 0.00001 | ||
Merger Agreement [Member] | ||||
MERGER (Details) [Line Items] | ||||
Proceeds from Merger | $ 10,000,000 | |||
Merger Agreement, Description of Consideration | Each holder of an outstanding share of SilverSun common stock will receive: ● A cash dividend of $1.50 per share, which equates to $7,884,266 in the aggregate; ● A stock dividend of one share of SilverSun Technologies Holdings, Inc. ("HoldCo"), a recently formed subsidiary of SilverSun. HoldCo's sole assets are its 100% ownership of SWK and SCS (together the "Subsidiaries"), which Subsidiaries accounted for the large majority of SilverSun's revenue in 2022. It is expected that the capital structure of HoldCo will roughly approximate the current capital structure of SilverSun; ● Following the consummation of the business combination, the business of the Subsidiaries will continue to be operated consistent with past practices. The current management and Board of Directors of SilverSun, including Mark Meller, the Chief Executive Officer of both SilverSun and SWK, will continue in their current roles at both HoldCo and the Subsidiaries. HoldCo will apply for public listing and the shares distributed in the stock dividend will be registered pursuant to a Form 10 that will be filed by HoldCo with the SEC (subject to regulatory and exchange regulations and approvals); and ● The shares of SilverSun's common stock to be retained by the current SilverSun stockholders following the consummation of the business combination will collectively represent approximately 3.2% of SilverSun's pro forma common equity ownership. | |||
Company [Member] | Merger Agreement [Member] | ||||
MERGER (Details) [Line Items] | ||||
Equity Method Investment, Ownership Percentage | 3.20% |
SUBSEQUENT (Details)
SUBSEQUENT (Details) - Subsequent Event [Member] | Aug. 04, 2023 $ / shares |
SUBSEQUENT (Details) [Line Items] | |
Dividends Payable, Date Declared | Aug. 04, 2023 |
Common Stock, Dividends, Per Share, Declared | $ 0.2 |
Dividends Payable, Date to be Paid | Aug. 25, 2023 |
Dividends Payable, Date of Record | Aug. 18, 2023 |