SuperCom (SPCB) 20-F 24 May 17 2016 FY Annual report (foreign) Financial data

Document And Entity Information

Document And Entity Information	12 Months Ended
	Dec. 31, 2016shares
Document Information [Line Items]
Document Type	20-F
Amendment Flag	false
Document Period End Date	Dec. 31, 2016
Document Fiscal Year Focus	2,016
Document Fiscal Period Focus	FY
Entity Registrant Name	SuperCom Ltd
Entity Central Index Key	1,291,855
Current Fiscal Year End Date	--12-31
Entity Well-known Seasoned Issuer	No
Entity Filer Category	Non-accelerated Filer
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Trading Symbol	SPCB
Entity Common Stock, Shares Outstanding	14,938,339

CONSOLIDATED BALANCE SHEETS

CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Dec. 31, 2016	Dec. 31, 2015
CURRENT ASSETS
Cash and cash equivalents	$ 1,708	$ 22,246
Restricted bank deposit	1,110	3,274
Trade accounts receivable, net of allowance for doubtful accounts of $2,014 and $1,576 as of December 31,2016 and 2015, respectively (Note 14)	10,310	15,122
Deferred tax short term	1,567	2,639
Other accounts receivable and prepaid expenses (Note 3)	2,500	1,199
Inventories, net (Note 4)	5,965	3,602
TOTAL CURRENT ASSETS	23,160	48,082
LONG-TERM ASSETS
Severance pay funds (Note 2.j)	282	216
Deferred tax long term	2,656	1,433
Property and equipment, net (Note 6)	1,165	888
Customer Contracts	4,684	4,052
Software and other IP	5,987	4,595
Patents	5,283	0
Other Intangible assets (Note 7)	3,230	1,988
Goodwill	7,026	4,688
TOTAL ASSETS	53,473	65,942
CURRENT LIABILITIES
Trade accounts payable	3,958	3,705
Employees and payroll accruals	2,948	1,983
Related parties	56	77
Accrued expenses and other liabilities (Note 8)	3,497	2,422
Deferred revenue short term	1,633	0
Deferred tax liability short term	156	0
Short-term liability for future earn-out	679	2,051
TOTAL CURRENT LIABILITIES	12,927	10,238
LONG-TERM LIABILITIES
Deferred revenues	423	0
Long-term liability for future earn-out	946	931
Accrued severance pay	453	341
TOTAL LONG TERM LIABILITIES	1,822	1,272
TOTAL LIABILITIES	14,749	11,510
SHAREHOLDERS’ EQUITY (Note 11)
Ordinary shares, NIS 0.25 par value - authorized 18,000,000 shares, 14,938,339 shares issued and outstanding at December 31, 2016 and 15,493,615 shares issued and outstanding at December 31, 2015	1,024	1,053
Additional paid-in capital	81,515	83,201
Accumulated deficit	(43,815)	(29,822)
Total shareholders’ equity	38,724	54,432
Total liabilities and shareholders’ equity	$ 53,473	$ 65,942

CONSOLIDATED BALANCE SHEETS (Pa

CONSOLIDATED BALANCE SHEETS (Parenthetical) $ in Thousands	Dec. 31, 2016USD ($)$ / sharesshares	Dec. 31, 2016ILS (₪)₪ / sharesshares	Dec. 31, 2015USD ($)$ / sharesshares	Dec. 31, 2015ILS (₪)₪ / sharesshares
Trade receivables, allowance for doubtful accounts	$ 2,014		$ 1,576
Ordinary shares, par value per share | (per share)		₪ 0.25		₪ 0.25
Ordinary shares, shares authorized	18,000,000	18,000,000	18,000,000	18,000,000
Ordinary shares, shares issued	14,938,339	14,938,339	15,493,615	15,493,615
Ordinary shares, shares outstanding	14,938,339	14,938,339	15,493,615	15,493,615

CONSOLIDATED STATEMENTS OF OPER

CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
REVENUES	$ 20,025	$ 28,340	$ 29,703
COST OF REVENUES	17,461	10,446	7,301
GROSS PROFIT	2,564	17,894	22,402
OPERATING EXPENSES:
Research and development	6,718	3,669	3,359
Sales and marketing	9,970	6,611	7,036
General and administrative	7,277	3,947	2,773
Other expenses	713	2,174	1,225
Gain on bargain acquisition	(10,515)	0	0
Total operating expenses	14,163	16,401	14,393
OPERATING INCOME (EXPENSE)	(11,599)	1,493	8,009
Financial expenses, net	(303)	(277)	(133)
INCOME (EXPENSE) BEFORE INCOME TAXES	(11,902)	1,216	7,876
Income tax benefit (expense)	(2,091)	(197)	(1,675)
NET INCOME (LOSS) FOR THE YEAR	$ (13,993)	$ 1,019	$ 6,201
Net income (EXPENSE) per share:
Basic	$ (0.93)	$ 0.07	$ 0.46
Diluted	$ (0.93)	$ 0.07	$ 0.45
Shares used in calculation of net income per share:
Basic (in shares)	15,048,812	15,047,496	13,560,490
Diluted (in shares)	15,048,812	15,202,303	13,662,151

CONSOLIDATED STATEMENTS OF CHAN

CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY AND COMPREHENSIVE INCOME - USD ($) $ in Thousands	Total	Ordinary Shares [Member]	Additional Paid-in Capital [Member]	Accumulated deficit [Member]
Balance at Dec. 31, 2013	$ 19,392	$ 904	$ 55,530	$ (37,042)
Balance (in shares) at Dec. 31, 2013		13,284,144
Exercise of options and warrants	82	$ 7	75	0
Exercise of options and warrants (in shares)		100,441
Issuance of share capital, net of issuance costs	$ 2,458	$ 26	2,432	0
Issuance of share capital, net of issuance costs (in shares)	358,000	358,000
Stock based compensation	$ 173	$ 0	173	0
Net income for the year	6,201	0	0	6,201
Balance at Dec. 31, 2014	28,306	$ 937	58,210	(30,841)
Balance (in shares) at Dec. 31, 2014		13,742,585
Exercise of options and warrants	193	$ 7	186	0
Exercise of options and warrants (in shares)		110,966
Issuance of share capital, net of issuance costs	27,126	$ 159	26,967	0
Issuance of share capital, net of issuance costs (in shares)		2,415,000
Treasury shares acquired	$ (3,741)	$ (50)	(3,691)	0
Treasury shares acquired (in shares)	(774,936)	(774,936)
Issuance of warrants	$ 503	$ 0	503	0
Stock based compensation	1,026	0	1,026	0
Net income for the year	1,019	0	0	1,019
Balance at Dec. 31, 2015	54,432	$ 1,053	83,201	(29,822)
Balance (in shares) at Dec. 31, 2015		15,493,615
Exercise of options and warrants	22	$ 0	22	0
Exercise of options and warrants (in shares)		10,883
Treasury shares acquired	$ (2,661)	$ (29)	(2,632)	0
Treasury shares acquired (in shares)	(566,159)	(566,159)
Stock based compensation	$ 924	$ 0	924	0
Net income for the year	(13,993)	0	0	(13,993)
Balance at Dec. 31, 2016	$ 38,724	$ 1,024	$ 81,515	$ (43,815)
Balance (in shares) at Dec. 31, 2016		14,938,339

CONSOLIDATED STATEMENTS OF CASH

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
CASH FLOWS - OPERATING ACTIVITIES
Net income (loss) for the year	$ (13,993)	$ 1,019	$ 6,201
Adjustments to reconcile net income to net cash from operations:
Depreciation and amortization	3,005	1,673	1,615
Stock-based compensation	924	1,529	173
Decrease (Increase) in Deferred tax	738	187	1,854
Capital loss on disposal of property and equipment		0	1
Gain on bargain purchase	(10,515)	0	0
Decrease (increase) in trade receivables, net	5,797	(3,666)	(8,532)
Decrease (increase) in other accounts receivable and prepaid expenses	(1,000)	39	2,175
Increase (decrease) in inventories, net	372	(1,988)	(907)
Increase (decrease) in trade payables	(79)	721	1,203
Increase in employees and payroll accruals	323	404	525
Increase (decrease) in accrued severance pay	75	(110)	26
Increase (decrease) in advances from customer	0	(2,864)	2,864
Increase (decrease) in accrued expenses and other liabilities, related parties and liability for earn-out	3,308	(618)	(927)
Net cash provided by (used in) operating activities	(11,045)	(3,674)	6,271
CASH FLOWS - INVESTING ACTIVITIES
Purchase of property and equipment	(400)	(541)	(544)
Purchase of Intangible assets	(39)	0	0
Capitalization of software development costs	(1,487)	(2,099)	0
Capitalization of Precontract costs	(203)	0	0
Acquisitions of subsidiaries, net of cash acquired	(3,514)	(988)	0
Acquisition of group of assets (non-business)	(1,174)	0	0
Decrease (Increase) in severance pay fund	(58)	109	(31)
Restricted bank deposits, net	2,212	1,921	(5,110)
Net cash used in investing activities	(4,663)	(1,598)	(5,685)
CASH FLOWS - FINANCING ACTIVITIES
Short-term bank credit, net	0	0	(1)
Treasury shares acquired	(2,661)	(3,741)	0
Proceeds from issuance of share capital, net of issuance costs	0	27,126	2,458
Payment of liability for future earn-out in business combination	(2,191)	(849)	(1,009)
Proceeds from exercise of options and warrants, net	22	193	82
Net cash provided by (used in) financing activities	(4,830)	22,729	1,530
Increase (decrease) in cash and cash equivalents	(20,538)	17,457	2,116
Cash and cash equivalents - beginning of year	22,246	4,789	2,673
Cash and cash equivalents - end of year	$ 1,708	$ 22,246	$ 4,789

CONSOLIDATED STATEMENTS OF CAS7

CONSOLIDATED STATEMENTS OF CASH FLOW $ in Thousands	12 Months Ended
	Dec. 31, 2016USD ($)
Working capital (excluding cash and cash equivalents)	$ 2,105
Property and equipment, net	365
Deferred taxes, net	733
Intangible Assets including goodwill	11,251
Contingent consideration	(425)
Assets and liabilities of the acquired business, as of date of acquisition Total	14,029
Gain on bargain purchase	(10,515)	[1]
Acquisitions of subsidiaries, net of cash acquired	$ 3,514
[1]	Gain on bargain purchase is attributed to two of the acquisitions, see Note 5 for more information

GENERAL

GENERAL	12 Months Ended
	Dec. 31, 2016
GENERAL [Abstract]
GENERAL	NOTE 1: GENERAL a. SuperCom Ltd. (the “Company”) is an Israeli resident company organized in 1988 in Israel. On January 24, 2013 the Company changed its name back to SuperCom Ltd, its original name, from Vuance Ltd. On September 12, 2013, the Company’s ordinary shares were approved for listing on the NASDAQ Capital Market and began trading under the ticker symbol “SPCB” on September 17, 2013. Previously, the Company’s ordinary shares traded on the OTCQB® electronic quotation service. The Company is a global provider of traditional and digital identity solutions, providing advanced safety, identification, tracking and security products to governments and organizations, both private and public, throughout the world The Company provides cutting edge real-time positioning, tracking, monitoring and verification solutions enabled by its RFID &Mobile pure security advanced solutions suite of products and technologies, all connected to a web-based, secure, proprietary, interactive and user-friendly interface. The Company offers a wide range of solutions including, national ID registries, e-passports, biometric visas, automated fingerprint identification systems, digitized driver’s licenses, and electronic voter registration and election management using the common platform (“MAGNA”). The Company sells its products through marketing offices in the U.S, Tanzania, Panama, Ecuador and Israel. b. On December 26, 2013 the Company acquired the SmartID Division of On Track Innovations Ltd. (NASDAQ: OTIV) (“OTI”), consisting of customer contracts, software, other related technologies and IP assets. The Company paid OTI $ 8.8 10 12.5 In June 2015, the Company has completed an offering which included an issuance of 2,415,000 shares with total net proceeds of $27,126 thousands. On January 1, 2016, the Company acquired Leaders in Community Alternatives, Inc., or LCA, a U.S. based company, including all contracts, software, other related technologies and IP assets. The Company paid $ 2.9 In addition to LCA, during the first half of 2016 the Company acquired Safend Ltd., Alvarion Technologies Ltd. and the assets and IP of PowaPOS. For additional information refer to Note 5. As of December 31, 2016, the Company’s principal activities were conducted mainly through SuperCom Ltd, LCA and safend that were acquired at the beginning of 2016, Supercom Inc. and through SuperCom Tanzania and SuperCom Ecuador that were acquired in December 2013 as part of the acquisition of the SmartID division. c. Concentration of risk that may have a significant impact on the Company: In 2016, the Company derived most of its revenues from large number of customers, in the year 2015 from five major customers and throughout the 2014 period the Company derived most of its revenues from five major customers. See also Note 13c.

SIGNIFICANT ACCOUNTING POLICIES

SIGNIFICANT ACCOUNTING POLICIES	12 Months Ended
	Dec. 31, 2016
SIGNIFICANT ACCOUNTING POLICIES [Abstract]
SIGNIFICANT ACCOUNTING POLICIES	NOTE 2: SIGNIFICANT ACCOUNTING POLICIES The Company purchases certain services and products used by it to generate revenues in its projects and sales from several sole suppliers. Although there are only a limited number of manufacturers of those particular services and products, management believe that other suppliers could provide similar services and products on comparable terms without affecting operating results. The consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“US GAAP”). a. Use of estimates: The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates. b. Financial statements in U.S. dollars: Most of the revenues of the Company and its subsidiaries are received in U.S. dollars. In addition, a substantial portion of the costs of the Company and its subsidiaries are incurred in U.S. dollars. Therefore, management believes that the dollar is the currency of the primary economic environment in which the Company and its subsidiaries operate. Thus, the functional and reporting currency of the Company and its subsidiaries is the U.S. dollar. Monetary accounts maintained in currencies other than the U.S. dollar are re-measured into U.S. dollars at the exchange rate prevailing at the end of the reporting period in accordance with provisions of ASC 835-10. All transaction gains and losses from the re-measurement of monetary balance sheet items are reflected in the statements of operations as financial income or financial expenses as appropriate. c. Principles of consolidation: The consolidated financial statements include the accounts of the Company and its subsidiaries. Material intercompany transactions and balances were eliminated upon consolidation. Material profits from intercompany sales, not yet realized outside the group, were also eliminated. d. Cash and cash equivalents: The Company considers unrestricted short-term highly liquid investments originally purchased with maturities of three months or less to be cash equivalents. e. Allowance for doubtful accounts: The allowance for doubtful accounts is determined with respect to specific amounts the Company has determined to be doubtful of collection. In determining the allowance for doubtful accounts, the Company considers, among other things, its past experience with such customers and the information available regarding such customers. f. Inventories: Inventories are stated at the lower of cost or market value. Inventory write-offs are mainly provided to cover risks arising from slow-moving items or technological obsolescence. Cost is determined for all types of inventory using the moving average cost method. g. Property and equipment: Property and equipment are stated at cost, net of accumulated depreciation. Depreciation is computed using the straight-line method, over the estimated useful lives, at the following annual rates: % Computers and peripheral equipment 33 Office furniture and equipment 6 - 20 Leasehold improvements Over the shorter of the term of the lease or the life of the asset h. Impairment of long-lived assets and intangible assets: The Company’s long-lived assets and certain identifiable intangible assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to the future undiscounted cash flows expected to be generated by the asset. If such asset is considered to be impaired, the impairment to be recognized is measured as the amount by which the carrying amount of the asset exceeds the fair value of the asset. i. Goodwill: The Company’s goodwill reflects the excess of the consideration paid or transferred including the fair value of contingent consideration over the fair values of the identifiable net assets acquired. The goodwill impairment test is performed by evaluating an initial qualitative assessment of the likelihood of impairment. If this step indicates that the qualitative assessment does not result in a more likely than not indication of impairment, no further impairment testing is required. If it does result in a more likely than not indication of impairment, the impairment test is performed. In step one of the impairment test, the Company compares the fair value of the reporting unit to the carrying value of the reporting unit. If the fair value of the reporting unit exceeds the carrying value of the net assets allocated to that unit, goodwill is not impaired, and no further testing is required. If the fair value is less than the carrying value of the reporting unit, then the second step of the impairment test is performed to measure the amount of the impairment. In the second step, the reporting unit’s fair value is allocated to all the assets and liabilities of the reporting unit, including any unrecognized intangible assets, in a hypothetical analysis that simulates the business combination principles to derive an implied goodwill value. If the implied fair value of the reporting unit’s goodwill is less than its carrying value, the difference is recorded as impairment. j. Accrued severance pay and severance pay fund: The liabilities of the Company for severance pay of its Israeli employees are calculated pursuant to Israel’s Severance Pay Law. Employees are entitled to one month’s salary for each year of employment, or portion thereof. The Company’s liability for all its employees is presented under “accrued severance pay”. The Company deposits on a monthly basis to severance pay funds and insurance policies. The value of these policies is presented as an asset on the Company’s balance sheet. The deposited funds include accrued income up to the balance sheet date. The deposited funds may be withdrawn only upon the fulfillment of the Company’s obligation pursuant to Israel’s Severance Pay Law or labor agreements. Severance expenses for the years ended December 31, 2016, 2015 and 2014 amounted to $ 876 607 308 k. Revenue recognition: The Company and its subsidiaries generate their revenues from the sale of products, licensing, maintenance, royalties and long term contracts (including training and installation). Sales of Products Product sales are recognized in accordance with ASC 605-10, when persuasive evidence of an agreement exists, delivery of the product has occurred or services have been rendered, the fee is fixed or determinable, collectability is reasonably assured, and inconsequential or perfunctory performance obligations remain. If the product requires specific customer acceptance, revenue is deferred until customer acceptance occurs or the acceptance provision lapses. The Company is not obligated to accept returned products or issue credit for returned products, unless a product return has been approved by the Company in advance and according to specific terms and conditions. As of December 31, 2016, the Company had allowance for customer returns at an insignificant amount. Warranty period is usually 12 months. Based primarily on historical experience, the Company does not provide for warranty costs when revenue is recognized, since such costs are not material. Rendering of Service Revenue from logistics services is recognized when the services are rendered. Revenues from maintenance services are recognized over the term of the contracts. Where services are provided in stages, revenue is recognized using the percentage-of-completion method based on the actual service provided as a proportion of the total services to be performed. Revenue from long-term contracts The Company recognized certain long-term contract revenues in accordance with ASC Topic 605-35, “Construction-Type and Production-Type Contracts”. Pursuant to ASC Topic 605-35, revenues from these contracts are recognized under the percentage of completion method. The Company measures the percentage of completion based on output or input criteria, such as contract milestones, percentage of engineering completion or number of units shipped, as applicable to each contract. Provisions for estimated losses on uncompleted contracts are made during the period in which such losses are first identified, in the amount of the estimated loss on the entire contract. As of December 31, 2016, a provision for one contract was made. The Company’s management believes that the use of the percentage of completion method is appropriate in these cases since most of our contracts specify milestones achievements in details, as to allow determination of progress made towards completion. In addition, the Company’s contracts include provisions that clearly specify the enforceable rights of the parties to the contract, the consideration to be exchanged and the manner and terms of settlement. In all cases, the Company expects to perform its contractual obligations and the parties are expected to satisfy their obligations under the contract. Software Licensing and Maintenance, t he company applies software revenue recognition in accordance to ASC 985-650 to all transactions except those where no software is involved. Revenue is recognized when persuasive evidence of an arrangement exists, delivery has occurred, the fee is fixed or determinable and collectability is reasonably assured. Persuasive evidence is generally a binding purchase order or license agreement. Delivery occurs when product is delivered via a license key for our license upgrade agreements. For arrangements with multiple elements, including software licenses, maintenance and/or services, revenue is allocated and deferred in amounts equivalent to the vendor specific objective evidence (“VSOE”) of fair value for the undelivered elements. VSOE of fair value is based upon the price for which the undelivered element is sold separately. Safend was unable to determine VSOE for its PCS and as a result revenues from licenses are recognized pro-ratably over the PCS term. Revenues from maintenance services are recognized over the term of the contracts. l. Research and development costs and software development costs: Research and development costs are expensed as incurred. Software development costs eligible for capitalization are accounted for in accordance with 985-20 Software — Costs of Software to be Sold, Leased or Marketed. Capitalization of software development costs for products to be sold to third parties begins upon the establishment of technological feasibility and ceases when the product is available for general release. Amortization is calculated and provided over the estimated economic life of the software, using the straight-line method. Amortization commences when developed software is available for general release to clients. The estimated useful life of capitalized software development 3 5 m. Income taxes: The Company and its subsidiaries account for income taxes in accordance with ASC Topic 740, “Income Taxes”. This Statement prescribes the use of the liability method whereby deferred tax asset and liability account balances are determined based on differences between the financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws, that will be in effect when the differences are expected to reverse. The Company and its subsidiaries provide a valuation allowance, if necessary, to reduce deferred tax assets to their estimated realizable value. The Company accounts for uncertain tax positions in accordance with ASC Topic 740-10, which prescribes detailed guidance for the financial statement recognition, measurement and disclosure of uncertain tax positions recognized in an enterprise’s financial statements. According to ASC Topic 740-10, tax positions must meet a more-likely-than-not recognition and measurement threshold. The Company’s accounting policy is to classify interest and penalties relating to uncertain tax positions under income taxes, however the Company did not recognize such items in its fiscal 2016, 2015 and 2014 financial statements. n. Concentrations of credit risk: Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash and cash equivalents, restricted cash deposits and trade receivables. The Company’s trade receivables are derived from sales to limited number of customers located primarily in Eastern Europe, Africa, the United States and Ecuador. The Company performs ongoing credit evaluations of its customers’ financial condition. The allowance for doubtful accounts is determined with respect to specific debts that the Company has determined to be doubtful of collection. Cash and cash equivalents and restricted cash deposits are deposited with major banks in Israel and the United States. Management believes that such financial institutions are financially sound and, accordingly, minimal credit risk exists with respect to these financial instruments. The Company has no significant off-balance-sheet concentration of credit risk. o. Basic and diluted earnings per share: Basic earnings per share are computed based on the weighted average number of ordinary shares outstanding during each year. Diluted earnings per share are computed based on the weighted average number of ordinary shares outstanding during each year, plus the dilutive potential of stock options and warrants outstanding during the year using the treasury stock method and the dilutive potential, if any, of convertible bonds using the “if-converted method”. The numbers of potential shares from the conversion of options and warrants that have been excluded from the calculation were 333,526 392,124 35,193 p. Fair value of financial instruments: At December 31, 2016 and 2015, the carrying amounts of cash and cash equivalents, restricted cash deposits, current trade receivables, other accounts receivable, trade payables and other accounts payable approximate their fair value due to the short-term maturity of such financial instruments. q. Accounting for stock-based compensation: Stock-based compensation, including grants of stock options, is recognized in the consolidated statement of operations as an operating expense, based on the fair value of the award on the date of grant. The fair value of stock-based compensation is estimated using an option-pricing model. The value of the portion of the award that is ultimately expected to vest is recognized as an expense over the requisite service periods in the Company’s consolidated statement of operations. The Company estimates the fair value of employee stock options using a Black-Scholes valuation model. The Company amortizes compensation costs using the graded vesting attribution method over the vesting period, net of estimated forfeitures. r. Acquisition-related intangible assets The Company accounts for its business combinations in accordance with ASC 805 “Business Combinations” and with ASC 350-20 “Goodwill and Other Intangible Assets” (“ASC 350-20”). ASC 805-10 specifies the accounting for business combinations and the criteria for recognizing and reporting intangible assets apart from goodwill. Acquisition-related intangible assets result from the Company’s acquisitions of businesses accounted for under the purchase method and consist of the value of identifiable intangible assets including developed software products, and trade names, as well as goodwill. Goodwill is the amount by which the acquisition cost exceeds the fair values of identifiable acquired net assets on the date of purchase. Acquisition-related intangible assets are reported at cost, net of accumulated amortization. s. Accounting Standards Not Yet Adopted Revenue Recognition - Contracts with Customers. The standard was issued to achieve a consistent application of revenue recognition within the U.S., resulting in a single revenue model to be applied by reporting companies under U.S. GAAP. Under the new model, recognition of revenue occurs when a customer obtains control of promised goods or services in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In addition, the new standard requires that reporting companies disclose the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. The standard is effective in the first quarter of 2018. As a result of adopting the standard, the Company has identified change in software license revenue recognition timing in which the Company expects to recognize revenue at the software license delivery rather than ratably over the service period due to the Company's inability to establish VSOE. For the Company's long term contract the Company evaluates whether the contracts are satisfied over time or at a point in time. More specifically, the Company considers whether it satisfies the ASC 606-10-25-27(c) as to whether the Company creates an asset with no alternative use. If determined that the performance obligation creates an asset with no alternative use and the Company has the right for payment to the work completed to date than no substantial change to the manner of recognition from current methodology. If determined otherwise the Company may need to recognize revenues from the contract at a point in time which will defer the recognition until delivery occurred. t. Certain amount in prior years has been reclassified to correspond to the current year.

OTHER ACCOUNTS RECEIVABLE AND P

OTHER ACCOUNTS RECEIVABLE AND PREPAID EXPENSES	12 Months Ended
	Dec. 31, 2016
OTHER ACCOUNTS RECEIVABLE AND PREPAID EXPENSES [Abstract]
OTHER ACCOUNTS RECEIVABLE AND PREPAID EXPENSES	NOTE 3: OTHER ACCOUNTS RECEIVABLE AND PREPAID EXPENSES December 31, 2016 2015 $ $ Prepaid expenses 304 176 Advances to suppliers 245 - Government institutions 708 780 Others 1,243 243 2,500 1,199

INVENTORIES, NET

INVENTORIES, NET	12 Months Ended
	Dec. 31, 2016
INVENTORIES, NET [Abstract]
INVENTORIES, NET	NOTE 4: INVENTORIES, NET December 31, 2016 2015 $ $ Raw materials, parts and supplies 1,758 928 Finished products 4,207 2,674 5,965 3,602 As of December 31, 2016 and 2015, inventory is presented net of write offs for slow inventory in the amount of approximately $ 218 151

ACQUISITION

ACQUISITION	12 Months Ended
	Dec. 31, 2016
ACQUISITION [Abstract]
ACQUISITION	NOTE 5: ACQUISITION Purchase agreement with OTI On August 13, 2013, the Company entered into an asset purchase agreement with OTI, to acquire OTI’s SmartID Division, including all contracts, software, other related technologies and IP assets. The acquisition closed on December 26, 2013. The Company agreed to pay OTI $ 10 12.5 In April 22, 2016 the Company concluded further negotiations with OTI with respect to the earn-out liability by which an agreement with OTI was signed. Under this agreement the remaining earn-out amount was set to a maximum $ 3,550 2,050 1,500 The expected intangible assets amortization expenses for the customer contracts and for software and other IP, are as follows: $ 2017 966 2018 855 2019 764 2020 690 2021 629 2022 579 2023-2028 2,682 Purchase of Prevision Ltd. In November, 2015 the Company acquired 100 1.1 0.2 1.3 250,000 Purchase of Leaders in Community Alternatives Inc. In January 2016 the Company acquired 100 2.9 Details of the consideration paid, the assets acquired and liabilities assumed at the acquisition date, are as follows: Total consideration $ 2,918 Acquired assets and liabilities Capital acquired 435 Customer relations 424 Deferred tax liability (170) Goodwill 2,229 Intangible assets' depreciated cost amounts to $ 2,592 61 Purchase of Safend Ltd. In March 2016 the Company acquired 100 1,500 3.7 Details of the consideration paid, the assets acquired and liabilities assumed at the acquisition date, are as follows: Total consideration $ 0 Acquired assets and liabilities Capital acquired (145) Customer relations 1,912 IP 346 Patents 1,583 Deferred tax asset 606 Deferred tax liability (565) Gain from bargain purchase 3,737 Intangible assets' depreciated cost amounts to $ 3,222 619 Purchase of PowaPOS’ assets and IP On April 18, 2016, the Company acquired IP, Inventory and Receivable of PowaPOS, a division of POWA Technologies Ltd. PowaPOS provides a fully-integrated mobile and tablet-based system innovative POS platform. The asset’s acquisition’s consideration amounted to approximately $ 1,174 493 543 138 Purchase of Alvarion Technologies Ltd. On May 18, 2016, the Company acquired Alvarion Technologies Ltd. (“Alvarion”). In consideration for this acquisition, the Company will pay up to $ 1 1 6.8 Details of the consideration paid, the assets acquired and liabilities assumed at the acquisition date, are as follows: Total consideration $ 1,425 Acquired assets 2,705 Technology 739 Brand 290 Patents 3,700 Deferred tax asset 1,026 Deferred tax liability (257) Gain from bargain purchase 6,778 Depreciated cost amounts to $ 4,589 140

PROPERTY AND EQUIPMENT, NET

PROPERTY AND EQUIPMENT, NET	12 Months Ended
	Dec. 31, 2016
PROPERTY AND EQUIPMENT, NET [Abstract]
PROPERTY AND EQUIPMENT, NET	NOTE 6: PROPERTY AND EQUIPMENT, NET December 31, 2016 2015 $ $ Cost: Computers and peripheral equipment 2,539 1,131 Office furniture and equipment 801 351 Trade Equipment 35 - Leasehold improvements 427 295 Vehicle 29 29 3,831 1,806 Accumulated depreciation: Computers and peripheral equipment 1,978 648 Office furniture and equipment 580 202 Trade Equipment 2 - Leasehold improvements 77 39 Vehicle 29 29 2,666 918 Depreciated cost 1,165 888 (1) Depreciation expenses for the years ended December 31, 2016, 2015 and 2014, were $ 1,748 291 103 (2) Property plant and equipment in connection with business combination includes cost of $ 1,496 1,131

OTHER INTANGIBLE ASSETS

OTHER INTANGIBLE ASSETS	12 Months Ended
	Dec. 31, 2016
OTHER INTANGIBLE ASSETS [Abstract]
OTHER INTANGIBLE ASSETS	NOTE 7: OTHER INTANGIBLE ASSETS Other Intangible assets consists mainly of development costs of software to be sold, eased or marketed. Development costs capitalized in during the year ended December 31, 2016 amounted to $ 1,487 448

ACCRUED EXPENSES AND OTHER LIAB

ACCRUED EXPENSES AND OTHER LIABILITIES	12 Months Ended
	Dec. 31, 2016
ACCRUED EXPENSES AND OTHER LIABILITIES [Abstract]
ACCRUED EXPENSES AND OTHER LIABILITIES	NOTE 8: ACCRUED EXPENSES AND OTHER LIABILITIES December 31 2016 2015 $ $ Liabilities related with the Smart ID acquisition 805 813 Accrued marketing expenses 818 838 Authorities - 113 Professional services 318 160 Overheads 122 129 Legal contingent liability 236 6 Legal service providers 508 298 Other accrued expenses 690 65 3,497 2,422

COMMITMENTS AND CONTINGENT LIAB

COMMITMENTS AND CONTINGENT LIABILITIES	12 Months Ended
	Dec. 31, 2016
COMMITMENTS AND CONTINGENT LIABILITIES [Abstract]
COMMITMENTS AND CONTINGENT LIABILITIES	NOTE 9: COMMITMENTS AND CONTINGENT LIABILITIES a. Lease commitments: The Company’s facilities and those of certain subsidiaries are rented under several operating lease agreements for periods ending 2016 to 2019. The monthly lease amount, including management fees of the leased property, is approximately $ 172 Future minimum lease commitments under non-cancelable operating leases for the years ended December 31, are as follows: 2017 1,776 2018 1,608 2019 659 2020 188 4,231 b. Guarantees, indemnity and liens: 1. The Company issued bank guaranties in the total amount of $ 0.7 2. The Company has bank guarantees of up to NIS 1,320 343 3. On April 29, 2012, the Company’s board of directors approved the recording of a floating charge on all of the Company’s assets in favor of the Company’s current and former chairmen of the board of directors, unlimited in amount, in order to secure personal guarantees granted by them in favor of the Company, such as to a bank in order to secure short-term loans that are given by them from time to time to the Company. 4. Portion of the inventory is subject to a line of GBP 127 (approximately $156 as of December 31, 2016) for inventory held in a third-party warehouse. c. Litigation: As part of the acquisition of the SmartID division of OTI, the Company assumed a dispute with Merwell Inc. (“Merwell”). Merwell has alleged that it has not received the full payment it is entitled to for its services in respect of a drivers’ license project. OTI alleged that Merwell breached its commitments under the service agreement and also acted in concert with third parties to damage OTI’s business activities. This matter is now subject to an arbitration proceeding. An appropriate provision is included in the financial statements. In February 2017 ,

INCOME TAX

INCOME TAX	12 Months Ended
	Dec. 31, 2016
INCOME TAX [Abstract]
INCOME TAX	NOTE 10: INCOME TAX a. Changes in Israeli corporate tax rates: The regular corporate tax rate in Israel in 2016 is 25 26.5 26.5 On August 5, 2013 the Israeli parliament (the Knesset) passed the Law for Changes in National Priorities (Legislative Amendments for Achieving Budget Objectives in the Years 2013 and 2014) - 2013, by which, inter alia, the corporate tax rate would be raised by 1.5 1.5 25 Under an amendment enacted in December 2016 to the Israel Income Tax Ordinance of 5721-1961, or the Tax Ordinance, the corporate tax rate will decrease to 24 23 b. Non-Israeli subsidiaries are taxed according to the tax laws of the countries in which they are located. c. Deferred 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. Significant components of the deferred tax assets of the Company and its subsidiaries are as follows: December 31, 2016 2015 $ $ Operating loss carry forwards 13,625 7,656 Reserves and allowances 913 1,629 Net deferred tax assets before valuation allowance 14,538 9,285 Valuation allowance (10,471) (5,213) Net deferred tax assets 4,067 4,072 Deferred income taxes consist of the following: Domestic 8,987 4,027 Valuation allowance (4,867) - Net deferred tax assets 4,120 4,027 Foreign 5,550 5,258 Valuation allowance (5,604) (5,213) (54) 45 As of December 31, 2016, the Company, its subsidiaries, have provided a valuation allowance of $ 10,471 4,067 d. Carryforward tax losses: SuperCom Ltd. has accumulated losses for tax purposes as of December 31, 2016 of approximately $ 23.1 13.8 As of December 31, 2016, SuperCom’s subsidiaries in the United States have estimated total available carryforward tax losses of approximately $ 14,411 3,413 e. Israeli entities acquired in 2016 had accumulated net carried forward losses derived from operations prior to the acquisition date. These losses which carry full valuation allowance are not included in note 10 c as the company is in process of validating its statutory position. SuperCom Ltd has assessments which are considered as final until the tax year ended December 31, 2011. SuperCom’s subsidiaries in the United States and Israel have not received final assessments since their incorporation. f. Income (loss) before income tax consists of the following: Year ended December 31, 2016 2015 2014 $ $ $ Domestic (9,634) 915 6,281 Foreign (2,268) 301 1,595 (11,902) 1,216 7,876 (*) Substantially all tax expenses are as a result of changes in deferred taxes g. Reconciliation of the theoretical tax benefit to the actual tax benefit: A reconciliation of theoretical tax expense, assuming all income is taxed at the statutory rate applicable to the income of companies in Israel, and the actual tax expense (benefit), is as follows: Year ended December 31, 2016 2015 2014 $ $ $ Income(loss) before income tax, as reported in the consolidated statements of operations (11,902) 1,216 7,876 Statutory tax rate in Israel 25 % 26.5 % 26.5 % Theoretical tax expense (2,976) 322 2,087 Current year carryforward losses and other differences for which a valuation allowance was recorded - 2 67 Changes in valuation allowance 5,257 (211) (1,332) Gain from bargain purchase and non-recoverable withholding taxes (1,516) Changes in foreign currency exchange rate and other differences 255 44 674 Changes in tax rate 828 - - Non-deductible expenses 243 40 179 Actual income tax expense (benefit) 2,091 197 1,675

SHARE CAPITAL

SHARE CAPITAL	12 Months Ended
	Dec. 31, 2016
SHARE CAPITAL [Abstract]
SHARE CAPITAL	NOTE 11: SHARE CAPITAL a. The Company’s ordinary shares are quoted under the symbol “SPCB” on the NASDAQ Capital Market in the United States. On August 22, 2013, a 1 for 4.250002 reverse split of the Company’s ordinary shares became effective. Pursuant to this reverse share split, each 4.250002 ordinary shares of NIS 0.0588235 0.25 15 All amounts of shares and per shares have been retroactively amended to give effect to the reverse stock splits. In December 2013, 3,450,000 13,800 During 2014, 358,000 2,458 In June 2015, 2,415,000 28,980 27,126 In December 2015, as part of the Company’s stock repurchase plan, the Company repurchased 774,936 4.80 During 2016, as part of the Company’s stock repurchase plan, the Company repurchased additional 566,159 at an average cost of $ 4.74 1,250,546 b. Shareholders’ rights: The ordinary shares confer upon the holders the right to receive notice to participate and vote in the general meetings of the Company, and the right to receive dividends, if declared. c. Stock options: 1. In 2003, the Company adopted a stock option plan under which the Company issues stock options (the “Option Plan”). The Option Plan is intended to provide incentives to the Company’s employees, officers, directors and/or consultants by providing them with the opportunity to purchase ordinary shares of the Company. Subject to the provisions of the Israeli Companies Law, the Option Plan is administered by the Compensation Committee, and is designed: (i) to comply with Section 102 of the Israeli Tax Ordinance or any provision which may amend or replace it and the rules promulgated thereunder and to enable the Company and grantees thereunder to benefit from Section 102 of the Israeli Tax Ordinance and the Commissioner’s Rules; and (ii) to enable the Company to grant options and issue shares outside the context of Section 102 of the Israeli Tax Ordinance. Options granted under the Option Plan will become exercisable ratably over a period of three to five years or immediately in certain circumstances, commencing with the date of grant. The options generally expire no later than 10 As a result of an amendment to Section 102 of the Israeli Tax Ordinance as part of the 2003 Israeli tax reform, and pursuant to an election made by the Company thereunder, capital gains derived by optionees arising from the sale of shares issued pursuant to the exercise of options granted to them under Section 102 after January 1, 2003, will generally be subject to a flat capital gains tax rate of 25%. However, as a result of this election, the Company will no longer be allowed to claim as an expense for tax purposes the amounts credited to such employees as a benefit when the related capital gains tax is payable by them, as the Company had previously been entitled to do under Section 102. On June 27, 2007, the Compensation Committee and board of directors of the Company approved a new option plan under which the Company may grant stock options to the U.S. employees of the Company and its subsidiaries. Under this new option plan, the Company may grant both qualified (for preferential tax treatment) and non-qualified stock options. On August 15, 2007, the new option plan was approved by the shareholders of the Company at the general shareholders meeting. During 2013, the Company issued options to purchase up to 152,949 137 0.72 4 In June 2013, the Option plan was extended for another period of 10 During the year 2014, the Company issued option to purchase up to 36,765 189 1.86 31,765 During the year 2015, the Company issued option to purchase up to 500,530 3,974 5.80 41,882 81,000 During the year 2016, the Company issued option to purchase up to 67,883 shares to several employees of the Company. The options (fair value of which was estimated at $208) have a weighted average exercise price of $2.82, and of such options, 2,500 were exercised and 8,000 were cancelled by the end of 2016. 2. A summary of the Company’s stock option activity and related information is as follows: Year ended December 31 2016 2015 2014 Number of Weighted Number of Weighted Number of Weighted $ $ $ Outstanding at Beginning of year 487,432 5.12 137,855 2.64 204,931 2.06 Granted 67,833 2.82 500,530 5.80 36,765 1.86 Exercised (8,383) 1.53 (65,411) 3.10 (100,441) 0.82 Canceled and forfeited (130,500) 6.96 (85,542) 6.64 (3,400) 13.00 Outstanding at end of year 416,432 4.24 487,432 5.12 137,855 2.64 Exercisable at end of year 186,253 4.14 95,709 4.81 44,618 5.90 The weighted average fair value of options granted during the reported periods was $ 6.2 7.94 5.15 The fair value of these options was estimated on the date of grant using the Black & Scholes option pricing model. The following weighted average assumptions were used for the 2016 and 2015 1.28 0 362.86 3.11 0.34 0 314.47 1.9 The expected volatility was based on the historical volatility of the Company’s stock. The expected term was based on the historical experience and based on Management estimate. Compensation expenses recognized by the Company related to its stock-based employee compensation awards and warrants were $924, $1,529, and $173 for the years ended December 31, 2016, 2015 and 2014, respectively. The following table summarizes the allocation of the stock-based compensation and warrants charge Year ended December 31, 2016 2015 2014 $ $ $ Cost of revenues 266 264 - Research and development expenses 207 311 35 Selling and marketing expenses 292 249 - General and administrative expenses 159 705 138 924 1,529 173 The options outstanding and exercisable as of December 31, 2016, have been separated into ranges of exercise prices as follows: Range of Options Weighted Weighted Aggregate Options Weighted Aggregate $ $ $ $ $ 0.00-0.85 97,512 5.61 0.68 264,017 68,098 0.68 184,555 3.00-5.00 251,148 2.42 4.10 32,160 87,383 4.34 6,720 7.00-10.00 60,500 3.13 8.72 - 23,500 8.67 - 18.75-22.00 7,272 0.33 19.43 - 7,272 19.43 - 416,432 3.23 4.24 296,177 186,253 4.14 191,275 The total intrinsic value of options exercised for the years ended December 31, 2016, 2015 and 2014 was $ 191 138 943 3.78 9.39 9.17 A summary of the status of the Company’s non-vested options granted to employees as of December 31, 2015 and changes during the year ended December 31, 2015 is presented below: Options Weighted– Non-vested at January 1, 2016 384,473 7.04 Granted 67,883 27.80 Vested (38,295) 21.26 Forfeited and canceled (8,000) 7.78 Non-vested at December 31, 2016 406,061 0.66 As of December 31, 2016, there was $ 2,704 d. Private placements and warrants: A summary of the Company’s warrants activity to investors (including warrants issued in connection with convertible bonds and extinguishment of liabilities), to settle obligation to service providers, and related information is as follows: Year ended December 31, 2016 2015 2014 Number of Weighted Number of Weighted Number of Weighted - $ - $ - $ Outstanding at beginning of year 4,000 20.00 4,000 20.00 4,000 20.00 Granted 48,055 0.38 - - Exercised (48,055) 0.38 - - Canceled and forfeited (4,000) 20.00 - - - - Outstanding at end of year - - 4,000 20.00 4,000 20.00 Exercisable at end of year - - 4,000 20.00 4,000 20.00 e. Dividends: No dividends were declared in the reported periods. In the event that cash dividends are declared in the future, such dividends will be paid in NIS. The Company does not intend to distribute cash dividends in the foreseeable future.

RELATED PARTY TRANSACTIONS

RELATED PARTY TRANSACTIONS	12 Months Ended
	Dec. 31, 2016
RELATED PARTY TRANSACTIONS [Abstract]
RELATED PARTY TRANSACTIONS	NOTE 12: RELATED PARTY TRANSACTIONS a. On July 25, 2010, the board of directors of the Company elected Mrs. Tsviya Trabelsi to serve as Chairman. Mrs. Trabelsi is an officer at Sigma Wave Ltd., which is the controlling shareholder of the Company and is also the wife of the Company’s chief executive officer. On May 12, 2011, the special general meeting approved a service agreement with Mrs. Trabelsi whereby she will receive a monthly fee equal to 60 b. Mr. Trabelsi has served as the chief executive officer of the Company since June 1, 2012. Mr. Trabelsi is the sole director of Sigma Wave, which is the controlling shareholder of the Company. On May 9, 2013, the general meeting of shareholders of the Company approved the payment of management fees to Mr. Trabelsi of $ 10.6 2 0.5 c. As of December 31, 2016, the Company accrued $ 56 d. On April 29, 2012, the board of directors approved the recording of a floating charge on all of the Company’s assets in favor of Mrs. and Mr. Trabelsi, unlimited in amount, in order to secure personal guarantees granted by them in favor of the Company to a bank and in order to secure short-term loans that are given by them from time to time to the Company. The short terms loans provided by Mrs. and Mr. Trabelsi during the years 2010 until 2013 ranged from NIS 10,000 1,965,000 1 260

SEGMENTS, MAJOR CUSTOMERS AND G

SEGMENTS, MAJOR CUSTOMERS AND GEOGRAPHIC INFORMATION	12 Months Ended
	Dec. 31, 2016
SEGMENTS, MAJOR CUSTOMERS AND GEOGRAPHIC INFORMATION [Abstract]
SEGMENTS, MAJOR CUSTOMERS AND GEOGRAPHIC INFORMATION	NOTE 13: SEGMENTS, MAJOR CUSTOMERS AND GEOGRAPHIC INFORMATION a. Summary information about geographic areas: The Company manages its business on the basis of one reportable segment (see Note 1 for a brief description of the Company’s business) and follows the requirements of ASC Topic 280, “Segment Reporting”. The following is a summary of revenues from external customers of the continued operations within geographic areas and data regarding property and equipment, net: Year ended December 31, 2016 2015 2014 Total Property and Total Property and Total Property and Revenues Equipment, net revenues Equipment, net revenues Equipment, net $ $ $ $ $ $ Africa 5,681 - 20,425 - 24,083 - European countries 1,211 - 1,325 - 3,901 - South America 1,803 - 1,420 - 1,479 - United States 9,888 122 121 14 126 16 Israel 724 1,043 161 874 50 600 APAC 675 - - - Other 43 - 109 - 64 - 20,025 1,165 28,340 888 29,703 616 - Revenues were attributed to countries based on the customer’s location. - Property and equipment were classified based on geographic areas in which such property and equipment items are held. b. Summary of revenues from external customers based on products and services: Year ended December 31, 2016 2015 2014 $ $ $ Raw materials and equipment 3,353 9,427 4,982 Electronic monitoring 4,437 - - Treatment programs 4,530 - - Maintenance, royalties and project management 7,705 18,913 24,721 20,025 28,340 29,703 c. Major customer data as a percentage of total sales: Year ended December 31, 2016 2015 2014 Customer A 6 % 17 % 42 % Customer B 5 % 30 % 19 % Customer C 13 % 30 % 18 % Customer D - 3 % 13 % Customer E - 9 % - Customer F 8 % 5 % 5 % d. Summary information about segments: ASC 280, Segment Reporting, establishes standards for reporting information about operating segments. Operating segments are defined as components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker in deciding how to allocate resources and in assessing performance. Year ended December 31, 2016 Cyber Connectivity Government Total Revenues 1,760 1,527 16,738 20,025 Operating Loss (2,072) (1,557) (7,970) (11,599) Total property and Equipment net 84 175 906 1,165

OTHER EXPENSES

OTHER EXPENSES	12 Months Ended
	Dec. 31, 2016
OTHER EXPENSES [Abstract]
OTHER EXPENSES	NOTE 14: OTHER EXPENSES Year ended December 31, 2016 2015 2014 $ $ $ Doubtful debt provision 438 1,576 1,225 Acquisition related expenses 165 - - Other 110 598 - Total 713 2,174 1,225 Bad debt The following is a summary of the accounts receivables allowance for doubtful accounts for the years ended December 31: Year ended December 31, 2016 2015 2014 $ $ $ Balance at beginning of period 1,576 4,390 2,084 Provision during the period 1,238 1,576 2,306 Doubtful account classified as bad debt - (4,390) - Reversal of allowance for doubtful account (800) - - Balance at end of period 2,014 1,576 4,390

FINANCIAL (EXPENSES) INCOME, NE

FINANCIAL (EXPENSES) INCOME, NET	12 Months Ended
	Dec. 31, 2016
FINANCIAL (EXPENSES) INCOME, NET [Abstract]
FINANCIAL (EXPENSES) INCOME, NET	NOTE 15: FINANCIAL (EXPENSES) INCOME, NET 2016 2015 2014 $ $ $ Financial expenses: Interest, bank charges and fees (219) (211) (165) Exchange differences, net - (66) - Unwind of discount earn out liability (118) - - Total financial expenses (337) (277) (165) Financial income: Exchange differences, net 34 - 32 Total financial income 34 - 32 Total financial expenses, net (303) (277) (133)

SIGNIFICANT ACCOUNTING POLICI23

SIGNIFICANT ACCOUNTING POLICIES (Policies)	12 Months Ended
	Dec. 31, 2016
SIGNIFICANT ACCOUNTING POLICIES [Abstract]
Use of estimates	a. Use of estimates: The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates.
Financial statements in U.S. dollars	b. Financial statements in U.S. dollars: Most of the revenues of the Company and its subsidiaries are received in U.S. dollars. In addition, a substantial portion of the costs of the Company and its subsidiaries are incurred in U.S. dollars. Therefore, management believes that the dollar is the currency of the primary economic environment in which the Company and its subsidiaries operate. Thus, the functional and reporting currency of the Company and its subsidiaries is the U.S. dollar. Monetary accounts maintained in currencies other than the U.S. dollar are re-measured into U.S. dollars at the exchange rate prevailing at the end of the reporting period in accordance with provisions of ASC 835-10. All transaction gains and losses from the re-measurement of monetary balance sheet items are reflected in the statements of operations as financial income or financial expenses as appropriate.
Principles of consolidation	c. Principles of consolidation: The consolidated financial statements include the accounts of the Company and its subsidiaries. Material intercompany transactions and balances were eliminated upon consolidation. Material profits from intercompany sales, not yet realized outside the group, were also eliminated.
Cash and cash equivalents	d. Cash and cash equivalents: The Company considers unrestricted short-term highly liquid investments originally purchased with maturities of three months or less to be cash equivalents.
Allowance for doubtful accounts	e. Allowance for doubtful accounts: The allowance for doubtful accounts is determined with respect to specific amounts the Company has determined to be doubtful of collection. In determining the allowance for doubtful accounts, the Company considers, among other things, its past experience with such customers and the information available regarding such customers.
Inventories	f. Inventories: Inventories are stated at the lower of cost or market value. Inventory write-offs are mainly provided to cover risks arising from slow-moving items or technological obsolescence. Cost is determined for all types of inventory using the moving average cost method.
Property and equipment	g. Property and equipment: Property and equipment are stated at cost, net of accumulated depreciation. Depreciation is computed using the straight-line method, over the estimated useful lives, at the following annual rates: % Computers and peripheral equipment 33 Office furniture and equipment 6 - 20 Leasehold improvements Over the shorter of the term of the lease or the life of the asset
Impairment of long-lived assets and intangible assets	h. Impairment of long-lived assets and intangible assets: The Company’s long-lived assets and certain identifiable intangible assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to the future undiscounted cash flows expected to be generated by the asset. If such asset is considered to be impaired, the impairment to be recognized is measured as the amount by which the carrying amount of the asset exceeds the fair value of the asset.
Goodwill	i. Goodwill: The Company’s goodwill reflects the excess of the consideration paid or transferred including the fair value of contingent consideration over the fair values of the identifiable net assets acquired. The goodwill impairment test is performed by evaluating an initial qualitative assessment of the likelihood of impairment. If this step indicates that the qualitative assessment does not result in a more likely than not indication of impairment, no further impairment testing is required. If it does result in a more likely than not indication of impairment, the impairment test is performed. In step one of the impairment test, the Company compares the fair value of the reporting unit to the carrying value of the reporting unit. If the fair value of the reporting unit exceeds the carrying value of the net assets allocated to that unit, goodwill is not impaired, and no further testing is required. If the fair value is less than the carrying value of the reporting unit, then the second step of the impairment test is performed to measure the amount of the impairment. In the second step, the reporting unit’s fair value is allocated to all the assets and liabilities of the reporting unit, including any unrecognized intangible assets, in a hypothetical analysis that simulates the business combination principles to derive an implied goodwill value. If the implied fair value of the reporting unit’s goodwill is less than its carrying value, the difference is recorded as impairment.
Accrued severance pay and severance pay fund	j. Accrued severance pay and severance pay fund: The liabilities of the Company for severance pay of its Israeli employees are calculated pursuant to Israel’s Severance Pay Law. Employees are entitled to one month’s salary for each year of employment, or portion thereof. The Company’s liability for all its employees is presented under “accrued severance pay”. The Company deposits on a monthly basis to severance pay funds and insurance policies. The value of these policies is presented as an asset on the Company’s balance sheet. The deposited funds include accrued income up to the balance sheet date. The deposited funds may be withdrawn only upon the fulfillment of the Company’s obligation pursuant to Israel’s Severance Pay Law or labor agreements. Severance expenses for the years ended December 31, 2016, 2015 and 2014 amounted to $ 876 607 308
Revenue recognition	k. Revenue recognition: The Company and its subsidiaries generate their revenues from the sale of products, licensing, maintenance, royalties and long term contracts (including training and installation). Sales of Products Product sales are recognized in accordance with ASC 605-10, when persuasive evidence of an agreement exists, delivery of the product has occurred or services have been rendered, the fee is fixed or determinable, collectability is reasonably assured, and inconsequential or perfunctory performance obligations remain. If the product requires specific customer acceptance, revenue is deferred until customer acceptance occurs or the acceptance provision lapses. The Company is not obligated to accept returned products or issue credit for returned products, unless a product return has been approved by the Company in advance and according to specific terms and conditions. As of December 31, 2016, the Company had allowance for customer returns at an insignificant amount. Warranty period is usually 12 months. Based primarily on historical experience, the Company does not provide for warranty costs when revenue is recognized, since such costs are not material. Rendering of Service Revenue from logistics services is recognized when the services are rendered. Revenues from maintenance services are recognized over the term of the contracts. Where services are provided in stages, revenue is recognized using the percentage-of-completion method based on the actual service provided as a proportion of the total services to be performed. Revenue from long-term contracts The Company recognized certain long-term contract revenues in accordance with ASC Topic 605-35, “Construction-Type and Production-Type Contracts”. Pursuant to ASC Topic 605-35, revenues from these contracts are recognized under the percentage of completion method. The Company measures the percentage of completion based on output or input criteria, such as contract milestones, percentage of engineering completion or number of units shipped, as applicable to each contract. Provisions for estimated losses on uncompleted contracts are made during the period in which such losses are first identified, in the amount of the estimated loss on the entire contract. As of December 31, 2016, a provision for one contract was made. The Company’s management believes that the use of the percentage of completion method is appropriate in these cases since most of our contracts specify milestones achievements in details, as to allow determination of progress made towards completion. In addition, the Company’s contracts include provisions that clearly specify the enforceable rights of the parties to the contract, the consideration to be exchanged and the manner and terms of settlement. In all cases, the Company expects to perform its contractual obligations and the parties are expected to satisfy their obligations under the contract. Software Licensing and Maintenance, t he company applies software revenue recognition in accordance to ASC 985-650 to all transactions except those where no software is involved. Revenue is recognized when persuasive evidence of an arrangement exists, delivery has occurred, the fee is fixed or determinable and collectability is reasonably assured. Persuasive evidence is generally a binding purchase order or license agreement. Delivery occurs when product is delivered via a license key for our license upgrade agreements. For arrangements with multiple elements, including software licenses, maintenance and/or services, revenue is allocated and deferred in amounts equivalent to the vendor specific objective evidence (“VSOE”) of fair value for the undelivered elements. VSOE of fair value is based upon the price for which the undelivered element is sold separately. Safend was unable to determine VSOE for its PCS and as a result revenues from licenses are recognized pro-ratably over the PCS term. Revenues from maintenance services are recognized over the term of the contracts.
Research and development costs and software development costs	l. Research and development costs and software development costs: Research and development costs are expensed as incurred. Software development costs eligible for capitalization are accounted for in accordance with 985-20 Software — Costs of Software to be Sold, Leased or Marketed. Capitalization of software development costs for products to be sold to third parties begins upon the establishment of technological feasibility and ceases when the product is available for general release. Amortization is calculated and provided over the estimated economic life of the software, using the straight-line method. Amortization commences when developed software is available for general release to clients. The estimated useful life of capitalized software development 3 5
Income taxes	m. Income taxes: The Company and its subsidiaries account for income taxes in accordance with ASC Topic 740, “Income Taxes”. This Statement prescribes the use of the liability method whereby deferred tax asset and liability account balances are determined based on differences between the financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws, that will be in effect when the differences are expected to reverse. The Company and its subsidiaries provide a valuation allowance, if necessary, to reduce deferred tax assets to their estimated realizable value. The Company accounts for uncertain tax positions in accordance with ASC Topic 740-10, which prescribes detailed guidance for the financial statement recognition, measurement and disclosure of uncertain tax positions recognized in an enterprise’s financial statements. According to ASC Topic 740-10, tax positions must meet a more-likely-than-not recognition and measurement threshold. The Company’s accounting policy is to classify interest and penalties relating to uncertain tax positions under income taxes, however the Company did not recognize such items in its fiscal 2016, 2015 and 2014 financial statements.
Concentrations of credit risk	n. Concentrations of credit risk: Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash and cash equivalents, restricted cash deposits and trade receivables. The Company’s trade receivables are derived from sales to limited number of customers located primarily in Eastern Europe, Africa, the United States and Ecuador. The Company performs ongoing credit evaluations of its customers’ financial condition. The allowance for doubtful accounts is determined with respect to specific debts that the Company has determined to be doubtful of collection. Cash and cash equivalents and restricted cash deposits are deposited with major banks in Israel and the United States. Management believes that such financial institutions are financially sound and, accordingly, minimal credit risk exists with respect to these financial instruments. The Company has no significant off-balance-sheet concentration of credit risk.
Basic and diluted earnings per share	o. Basic and diluted earnings per share: Basic earnings per share are computed based on the weighted average number of ordinary shares outstanding during each year. Diluted earnings per share are computed based on the weighted average number of ordinary shares outstanding during each year, plus the dilutive potential of stock options and warrants outstanding during the year using the treasury stock method and the dilutive potential, if any, of convertible bonds using the “if-converted method”. The numbers of potential shares from the conversion of options and warrants that have been excluded from the calculation were 333,526 392,124 35,193
Fair value of financial instruments	p. Fair value of financial instruments: At December 31, 2016 and 2015, the carrying amounts of cash and cash equivalents, restricted cash deposits, current trade receivables, other accounts receivable, trade payables and other accounts payable approximate their fair value due to the short-term maturity of such financial instruments.
Accounting for stock-based compensation	q. Accounting for stock-based compensation: Stock-based compensation, including grants of stock options, is recognized in the consolidated statement of operations as an operating expense, based on the fair value of the award on the date of grant. The fair value of stock-based compensation is estimated using an option-pricing model. The value of the portion of the award that is ultimately expected to vest is recognized as an expense over the requisite service periods in the Company’s consolidated statement of operations. The Company estimates the fair value of employee stock options using a Black-Scholes valuation model. The Company amortizes compensation costs using the graded vesting attribution method over the vesting period, net of estimated forfeitures.
Acquisition-related intangible assets	r. Acquisition-related intangible assets The Company accounts for its business combinations in accordance with ASC 805 “Business Combinations” and with ASC 350-20 “Goodwill and Other Intangible Assets” (“ASC 350-20”). ASC 805-10 specifies the accounting for business combinations and the criteria for recognizing and reporting intangible assets apart from goodwill. Acquisition-related intangible assets result from the Company’s acquisitions of businesses accounted for under the purchase method and consist of the value of identifiable intangible assets including developed software products, and trade names, as well as goodwill. Goodwill is the amount by which the acquisition cost exceeds the fair values of identifiable acquired net assets on the date of purchase. Acquisition-related intangible assets are reported at cost, net of accumulated amortization.
Accounting Standards Not Yet Adopted	s. Accounting Standards Not Yet Adopted Revenue Recognition - Contracts with Customers. The standard was issued to achieve a consistent application of revenue recognition within the U.S., resulting in a single revenue model to be applied by reporting companies under U.S. GAAP. Under the new model, recognition of revenue occurs when a customer obtains control of promised goods or services in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In addition, the new standard requires that reporting companies disclose the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. The standard is effective in the first quarter of 2018. As a result of adopting the standard, the Company has identified change in software license revenue recognition timing in which the Company expects to recognize revenue at the software license delivery rather than ratably over the service period due to the Company's inability to establish VSOE. For the Company's long term contract the Company evaluates whether the contracts are satisfied over time or at a point in time. More specifically, the Company considers whether it satisfies the ASC 606-10-25-27(c) as to whether the Company creates an asset with no alternative use. If determined that the performance obligation creates an asset with no alternative use and the Company has the right for payment to the work completed to date than no substantial change to the manner of recognition from current methodology. If determined otherwise the Company may need to recognize revenues from the contract at a point in time which will defer the recognition until delivery occurred. t. Certain amount in prior years has been reclassified to correspond to the current year.

SIGNIFICANT ACCOUNTING POLICI24

SIGNIFICANT ACCOUNTING POLICIES (Tables)	12 Months Ended
	Dec. 31, 2016
SIGNIFICANT ACCOUNTING POLICIES [Abstract]
Schedule of Depreciation of Property and Equipment	% Computers and peripheral equipment 33 Office furniture and equipment 6 - 20 Leasehold improvements Over the shorter of the term of the lease or the life of the asset

OTHER ACCOUNTS RECEIVABLE AND25

OTHER ACCOUNTS RECEIVABLE AND PREPAID EXPENSES (Tables)	12 Months Ended
	Dec. 31, 2016
OTHER ACCOUNTS RECEIVABLE AND PREPAID EXPENSES [Abstract]
Schedule of Other Accounts Receivable and Prepaid Expenses	December 31, 2016 2015 $ $ Prepaid expenses 304 176 Advances to suppliers 245 - Government institutions 708 780 Others 1,243 243 2,500 1,199

INVENTORIES, NET (Tables)

INVENTORIES, NET (Tables)	12 Months Ended
	Dec. 31, 2016
INVENTORIES, NET [Abstract]
Schedule of Inventory, Net	December 31, 2016 2015 $ $ Raw materials, parts and supplies 1,758 928 Finished products 4,207 2,674 5,965 3,602

ACQUISITION (Tables)

ACQUISITION (Tables)	12 Months Ended
	Dec. 31, 2016
Schedule of Future Amortization Expense	$ 2017 966 2018 855 2019 764 2020 690 2021 629 2022 579 2023-2028 2,682
Leaders in Community Alternatives [Member]
Schedule of Acquired Finite-Lived Intangible Assets by Major Class	Total consideration $ 2,918 Acquired assets and liabilities Capital acquired 435 Customer relations 424 Deferred tax liability (170) Goodwill 2,229
Safend Ltd [Member]
Schedule of Acquired Finite-Lived Intangible Assets by Major Class	Total consideration $ 0 Acquired assets and liabilities Capital acquired (145) Customer relations 1,912 IP 346 Patents 1,583 Deferred tax asset 606 Deferred tax liability (565) Gain from bargain purchase 3,737
Alvarion Technologies Ltd. [Member]
Schedule of Acquired Finite-Lived Intangible Assets by Major Class	Total consideration $ 1,425 Acquired assets 2,705 Technology 739 Brand 290 Patents 3,700 Deferred tax asset 1,026 Deferred tax liability (257) Gain from bargain purchase 6,778

PROPERTY AND EQUIPMENT, NET (Ta

PROPERTY AND EQUIPMENT, NET (Tables)	12 Months Ended
	Dec. 31, 2016
PROPERTY AND EQUIPMENT, NET [Abstract]
Schedule of Property and Equipment, Net	December 31, 2016 2015 $ $ Cost: Computers and peripheral equipment 2,539 1,131 Office furniture and equipment 801 351 Trade Equipment 35 - Leasehold improvements 427 295 Vehicle 29 29 3,831 1,806 Accumulated depreciation: Computers and peripheral equipment 1,978 648 Office furniture and equipment 580 202 Trade Equipment 2 - Leasehold improvements 77 39 Vehicle 29 29 2,666 918 Depreciated cost 1,165 888

ACCRUED EXPENSES AND OTHER LI29

ACCRUED EXPENSES AND OTHER LIABILITIES (Tables)	12 Months Ended
	Dec. 31, 2016
ACCRUED EXPENSES AND OTHER LIABILITIES [Abstract]
Schedule of Accrued Expenses and Other Liabilities	December 31 2016 2015 $ $ Liabilities related with the Smart ID acquisition 805 813 Accrued marketing expenses 818 838 Authorities - 113 Professional services 318 160 Overheads 122 129 Legal contingent liability 236 6 Legal service providers 508 298 Other accrued expenses 690 65 3,497 2,422

COMMITMENTS AND CONTINGENT LI30

COMMITMENTS AND CONTINGENT LIABILITIES (Tables)	12 Months Ended
	Dec. 31, 2016
COMMITMENTS AND CONTINGENT LIABILITIES [Abstract]
Schedule of Future Minimum Payments under Operating Leases	2017 1,776 2018 1,608 2019 659 2020 188 4,231

INCOME TAX (Tables)

INCOME TAX (Tables)	12 Months Ended
	Dec. 31, 2016
INCOME TAX [Abstract]
Schedule of Deferred Tax Assets and Liabilities	December 31, 2016 2015 $ $ Operating loss carry forwards 13,625 7,656 Reserves and allowances 913 1,629 Net deferred tax assets before valuation allowance 14,538 9,285 Valuation allowance (10,471) (5,213) Net deferred tax assets 4,067 4,072 Deferred income taxes consist of the following: Domestic 8,987 4,027 Valuation allowance (4,867) - Net deferred tax assets 4,120 4,027 Foreign 5,550 5,258 Valuation allowance (5,604) (5,213) (54) 45
Schedule of Income (Loss) before Income Tax	Year ended December 31, 2016 2015 2014 $ $ $ Domestic (9,634) 915 6,281 Foreign (2,268) 301 1,595 (11,902) 1,216 7,876 (*) Substantially all tax expenses are as a result of changes in deferred taxes
Schedule of Effective Income Tax Reconciliation	Year ended December 31, 2016 2015 2014 $ $ $ Income(loss) before income tax, as reported in the consolidated statements of operations (11,902) 1,216 7,876 Statutory tax rate in Israel 25 % 26.5 % 26.5 % Theoretical tax expense (2,976) 322 2,087 Current year carryforward losses and other differences for which a valuation allowance was recorded - 2 67 Changes in valuation allowance 5,257 (211) (1,332) Gain from bargain purchase and non-recoverable withholding taxes (1,516) Changes in foreign currency exchange rate and other differences 255 44 674 Changes in tax rate 828 - - Non-deductible expenses 243 40 179 Actual income tax expense (benefit) 2,091 197 1,675

SHARE CAPITAL (Tables)

SHARE CAPITAL (Tables)	12 Months Ended
	Dec. 31, 2016
SHARE CAPITAL [Abstract]
Schedule of Stock Option Activity	Year ended December 31 2016 2015 2014 Number of Weighted Number of Weighted Number of Weighted $ $ $ Outstanding at Beginning of year 487,432 5.12 137,855 2.64 204,931 2.06 Granted 67,833 2.82 500,530 5.80 36,765 1.86 Exercised (8,383) 1.53 (65,411) 3.10 (100,441) 0.82 Canceled and forfeited (130,500) 6.96 (85,542) 6.64 (3,400) 13.00 Outstanding at end of year 416,432 4.24 487,432 5.12 137,855 2.64 Exercisable at end of year 186,253 4.14 95,709 4.81 44,618 5.90
Schedule of Stock-Based Compensation Charge	Year ended December 31, 2016 2015 2014 $ $ $ Cost of revenues 266 264 - Research and development expenses 207 311 35 Selling and marketing expenses 292 249 - General and administrative expenses 159 705 138 924 1,529 173
Schedule of Options Outstanding and Exercisable	Range of Options Weighted Weighted Aggregate Options Weighted Aggregate $ $ $ $ $ 0.00-0.85 97,512 5.61 0.68 264,017 68,098 0.68 184,555 3.00-5.00 251,148 2.42 4.10 32,160 87,383 4.34 6,720 7.00-10.00 60,500 3.13 8.72 - 23,500 8.67 - 18.75-22.00 7,272 0.33 19.43 - 7,272 19.43 - 416,432 3.23 4.24 296,177 186,253 4.14 191,275
Schedule of Nonvested Option Activity	Options Weighted– Non-vested at January 1, 2016 384,473 7.04 Granted 67,883 27.80 Vested (38,295) 21.26 Forfeited and canceled (8,000) 7.78 Non-vested at December 31, 2016 406,061 0.66
Schedule of Warrant Activity	Year ended December 31, 2016 2015 2014 Number of Weighted Number of Weighted Number of Weighted - $ - $ - $ Outstanding at beginning of year 4,000 20.00 4,000 20.00 4,000 20.00 Granted 48,055 0.38 - - Exercised (48,055) 0.38 - - Canceled and forfeited (4,000) 20.00 - - - - Outstanding at end of year - - 4,000 20.00 4,000 20.00 Exercisable at end of year - - 4,000 20.00 4,000 20.00

SEGMENTS, MAJOR CUSTOMERS AND33

SEGMENTS, MAJOR CUSTOMERS AND GEOGRAPHIC INFORMATION (Tables)	12 Months Ended
	Dec. 31, 2016
SEGMENTS, MAJOR CUSTOMERS AND GEOGRAPHIC INFORMATION [Abstract]
Schedule of External Customer Revenues by Geographic Area	Year ended December 31, 2016 2015 2014 Total Property and Total Property and Total Property and Revenues Equipment, net revenues Equipment, net revenues Equipment, net $ $ $ $ $ $ Africa 5,681 - 20,425 - 24,083 - European countries 1,211 - 1,325 - 3,901 - South America 1,803 - 1,420 - 1,479 - United States 9,888 122 121 14 126 16 Israel 724 1,043 161 874 50 600 APAC 675 - - - Other 43 - 109 - 64 - 20,025 1,165 28,340 888 29,703 616 - Revenues were attributed to countries based on the customer’s location. - Property and equipment were classified based on geographic areas in which such property and equipment items are held.
Schedule of Revenues by External Customers by Products and Services	Year ended December 31, 2016 2015 2014 $ $ $ Raw materials and equipment 3,353 9,427 4,982 Electronic monitoring 4,437 - - Treatment programs 4,530 - - Maintenance, royalties and project management 7,705 18,913 24,721 20,025 28,340 29,703
Schedule of Major Customers, Percent of Total Sales	Year ended December 31, 2016 2015 2014 Customer A 6 % 17 % 42 % Customer B 5 % 30 % 19 % Customer C 13 % 30 % 18 % Customer D - 3 % 13 % Customer E - 9 % - Customer F 8 % 5 % 5 %
Schedule of Segment Reporting Information, by Segment	The Company’s chief operating decision maker is its Chief Executive Officer. Year ended December 31, 2016 Cyber Connectivity Government Total Revenues 1,760 1,527 16,738 20,025 Operating Loss (2,072) (1,557) (7,970) (11,599) Total property and Equipment net 84 175 906 1,165

OTHER EXPENSES (Tables)

OTHER EXPENSES (Tables)	12 Months Ended
	Dec. 31, 2016
OTHER EXPENSES [Abstract]
Schedule of Other (Income) Expenses	Year ended December 31, 2016 2015 2014 $ $ $ Doubtful debt provision 438 1,576 1,225 Acquisition related expenses 165 - - Other 110 598 - Total 713 2,174 1,225
Summary of the Allowance for Doubtful Accounts	Year ended December 31, 2016 2015 2014 $ $ $ Balance at beginning of period 1,576 4,390 2,084 Provision during the period 1,238 1,576 2,306 Doubtful account classified as bad debt - (4,390) - Reversal of allowance for doubtful account (800) - - Balance at end of period 2,014 1,576 4,390

FINANCIAL (EXPENSES) INCOME, 35

FINANCIAL (EXPENSES) INCOME, NET (Tables)	12 Months Ended
	Dec. 31, 2016
FINANCIAL (EXPENSES) INCOME, NET [Abstract]
Schedule of Financial (Expenses) Income, Net	2016 2015 2014 $ $ $ Financial expenses: Interest, bank charges and fees (219) (211) (165) Exchange differences, net - (66) - Unwind of discount earn out liability (118) - - Total financial expenses (337) (277) (165) Financial income: Exchange differences, net 34 - 32 Total financial income 34 - 32 Total financial expenses, net (303) (277) (133)

GENERAL (Details)

GENERAL (Details) $ in Thousands	1 Months Ended		12 Months Ended
	Jan. 31, 2016USD ($)	Jun. 30, 2015USD ($)shares	Dec. 31, 2016USD ($)	Dec. 31, 2015USD ($)	Dec. 31, 2014USD ($)shares	Dec. 31, 2013USD ($)shares	Apr. 30, 2016USD ($)	Dec. 26, 2013USD ($)
Business Acquisition, Contingent Consideration [Line Items]
Cash paid for acquisition						$ 10,000
Cash paid for acquisition, net			$ 3,514	$ 988	$ 0	$ 8,800
Issuance of share capital, net of issuance costs (in shares) | shares		2,415,000			358,000	3,450,000
Total net proceeds from issuance of share capital		$ 27,126	$ 0	$ 27,126	$ 2,458
Number Of Major Customers				5	5
Alternatives Inc [Member]
Business Acquisition, Contingent Consideration [Line Items]
Payments For Earn Out Mechanism	$ 2,900
Earn-out Agreement [Member]
Business Acquisition, Contingent Consideration [Line Items]
Maximum contingent payments						$ 12,500	$ 3,550	$ 12,500

SIGNIFICANT ACCOUNTING POLICI37

SIGNIFICANT ACCOUNTING POLICIES (Details) - USD ($) $ in Thousands		12 Months Ended
		Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Property, Plant and Equipment [Line Items]
Antidilutive shares		333,526	392,124	35,193
Severance expenses		$ 876	$ 607	$ 308
Computers and peripheral equipment [Member]
Property, Plant and Equipment [Line Items]
Depreciation rate		33.00%
Office furniture and equipment [Member] | Minimum [Member]
Property, Plant and Equipment [Line Items]
Depreciation rate		6.00%
Office furniture and equipment [Member] | Maximum [Member]
Property, Plant and Equipment [Line Items]
Depreciation rate		20.00%
Leasehold improvements [Member]
Property, Plant and Equipment [Line Items]
Depreciation rate	[1]
capitalized software development costs [Member] | Minimum [Member]
Property, Plant and Equipment [Line Items]
Estimated useful life		3 years
capitalized software development costs [Member] | Maximum [Member]
Property, Plant and Equipment [Line Items]
Estimated useful life		5 years
[1]	Over the shorter of the term of the lease or the life of the asset

OTHER ACCOUNTS RECEIVABLE AND38

OTHER ACCOUNTS RECEIVABLE AND PREPAID EXPENSES (Details) - USD ($) $ in Thousands	Dec. 31, 2016	Dec. 31, 2015
Prepaid expenses	$ 304	$ 176
Advances to suppliers	245	0
Government institutions	708	780
Others	1,243	243
Other accounts receivable and prepaid expenses	$ 2,500	$ 1,199

INVENTORIES, NET (Details)

INVENTORIES, NET (Details) - USD ($) $ in Thousands	Dec. 31, 2016	Dec. 31, 2015
Raw materials, parts and supplies	$ 1,758	$ 928
Finished products	4,207	2,674
Inventories, net	5,965	3,602
Valuation adjustment for slow inventory	$ 218	$ 151

ACQUISITION (Narrative) (Detail

ACQUISITION (Narrative) (Details) - USD ($) $ in Thousands	1 Months Ended						12 Months Ended
	May 31, 2016	May 18, 2016	Apr. 18, 2016	Mar. 31, 2016	Jan. 31, 2016	Nov. 30, 2015	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013	Apr. 30, 2016	Dec. 26, 2013
Business Acquisition, Contingent Consideration [Line Items]
Cash paid for acquisition										$ 10,000
Customer relations and goodwill							$ 7,026	$ 4,688
Business Combination, Bargain Purchase, Gain Recognized, Amount							10,515	0	$ 0
Payments to Acquire Businesses, Gross										10,000
Amortization of Intangible Assets							448
Inventory Valuation Reserves							218	$ 151
Prevision [Member]
Business Acquisition, Contingent Consideration [Line Items]
Contingent payments cap						$ 250,000
Ownership interests						100.00%
Total consideration						$ 1,100
Net identifiable liabilities						200
Customer relations and goodwill						$ 1,300
Business Acquisition, Percentage of Voting Interests Acquired						100.00%
Business Combination, Consideration Transferred						$ 1,100
Leaders in Community Alternatives [Member]
Business Acquisition, Contingent Consideration [Line Items]
Ownership interests					100.00%
Total consideration					$ 2,918
Business Acquisition, Percentage of Voting Interests Acquired					100.00%
Business Combination, Consideration Transferred					$ 2,918
Cost of Services, Amortization							61
Amortization of Intangible Assets							2,592
Safend Ltd [Member]
Business Acquisition, Contingent Consideration [Line Items]
Additional contingent consideration				$ 1,500
Ownership interests				100.00%
Business Acquisition, Percentage of Voting Interests Acquired				100.00%
Business Combination, Bargain Purchase, Gain Recognized, Amount				$ 3,737
Cost of Services, Amortization							619
Amortization of Intangible Assets							3,222
PowaPOS [Member]
Business Acquisition, Contingent Consideration [Line Items]
Payments to Acquire Productive Assets			$ 1,174
Receivables, Net, Current			138
Finite-lived Intangible Assets Acquired			493
Inventory Valuation Reserves			$ 543
Alvarion Technologies Ltd. [Member]
Business Acquisition, Contingent Consideration [Line Items]
Cash paid for acquisition		$ 1,000
Total consideration		1,425
Business Combination, Consideration Transferred		1,425
Property, Plant, and Equipment, Salvage Value							4,589
Business Combination, Bargain Purchase, Gain Recognized, Amount		6,778
Payments to Acquire Businesses, Gross		1,000
Business Combination, Contingent Consideration, Liability		1,000
Amortization of Intangible Assets							140
Finite-lived Intangible Assets Acquired		$ 1,026
Earn-out Agreement [Member]
Business Acquisition, Contingent Consideration [Line Items]
Maximum contingent payments										$ 12,500	$ 3,550	$ 12,500
Additional contingent consideration	$ 2,050						$ 1,500

ACQUISITION (Schedule of Future

ACQUISITION (Schedule of Future Amortization Expense) (Details) $ in Thousands	Dec. 31, 2014USD ($)
Future amortization expense:
2,017	$ 966
2,018	855
2,019	764
2,020	690
2,021	629
2,022	579
2023-2028	$ 2,682

ACQUISITION (Schedule Of Intang

ACQUISITION (Schedule Of Intangible Assets Acquired) (Details) - USD ($) $ in Thousands	1 Months Ended			12 Months Ended
	May 18, 2016	Mar. 31, 2016	Jan. 31, 2016	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Gain from bargain purchase				$ 10,515	$ 0	$ 0
Leaders in Community Alternatives [Member]
Business Combination, Consideration Transferred			$ 2,918
Capital acquired			435
Deferred tax liability			(170)
Finite-lived Intangible Assets Acquired Including Goodwill			2,229
Leaders in Community Alternatives [Member] | Customer Relationships [Member]
Finite-lived Intangible Assets Acquired			$ 424
Safend Ltd [Member]
Gain from bargain purchase		$ 3,737
Safend Ltd [Member] | Customer Relationships [Member]
Business Combination, Consideration Transferred		0
Capital acquired		(145)
Finite-lived Intangible Assets Acquired		1,912
Deferred tax asset		606
Deferred tax liability		(565)
Safend Ltd [Member] | Intellectual Property [Member]
Finite-lived Intangible Assets Acquired		346
Safend Ltd [Member] | Patents [Member]
Finite-lived Intangible Assets Acquired		$ 1,583
Alvarion Technologies Ltd. [Member]
Business Combination, Consideration Transferred	$ 1,425
Acquired assets	2,705
Finite-lived Intangible Assets Acquired	1,026
Deferred tax liability	(257)
Gain from bargain purchase	6,778
Alvarion Technologies Ltd. [Member] | Technology-Based Intangible Assets [Member]
Finite-lived Intangible Assets Acquired	739
Alvarion Technologies Ltd. [Member] | Patents [Member]
Finite-lived Intangible Assets Acquired	290
Alvarion Technologies Ltd. [Member] | Brand [Member]
Finite-lived Intangible Assets Acquired	$ 3,700

PROPERTY AND EQUIPMENT, NET (De

PROPERTY AND EQUIPMENT, NET (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Property, Plant and Equipment [Line Items]
Depreciation expense	$ 1,748	$ 291	$ 103
Property plant and equipment cost in connection with business combination	1,496
Property plant and equipment depreciated cost	1,131
Property and equipment	3,831	1,806
Accumulated depreciation	2,666	918
Property and equipent, net	1,165	888	$ 616
Computers and peripheral equipment [Member]
Property, Plant and Equipment [Line Items]
Property and equipment	2,539	1,131
Accumulated depreciation	1,978	648
Office furniture and equipment [Member]
Property, Plant and Equipment [Line Items]
Property and equipment	801	351
Accumulated depreciation	580	202
Trade Equipment [Member]
Property, Plant and Equipment [Line Items]
Property and equipment	35	0
Accumulated depreciation	2	0
Leasehold improvements [Member]
Property, Plant and Equipment [Line Items]
Property and equipment	427	295
Accumulated depreciation	77	39
Vehicles [Member]
Property, Plant and Equipment [Line Items]
Property and equipment	29	29
Accumulated depreciation	$ 29	$ 29

OTHER INTANGIBLE ASSETS (Detail

OTHER INTANGIBLE ASSETS (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2016USD ($)
OTHER INTANGIBLE ASSETS [Abstract]
Costs Incurred, Development Costs	$ 1,487
Amortization of Intangible Assets	$ 448

ACCRUED EXPENSES AND OTHER LI45

ACCRUED EXPENSES AND OTHER LIABILITIES (Details) - USD ($) $ in Thousands	Dec. 31, 2016	Dec. 31, 2015
Liabilities related with the Smart ID acquisition	$ 805	$ 813
Accrued marketing expenses	818	838
Authorities	0	113
Professional services	318	160
Overheads	122	129
Legal contingent liability	236	6
Legal service providers	508	298
Other accrued expenses	690	65
Accrued expenses and other liabilities	$ 3,497	$ 2,422

COMMITMENTS AND CONTINGENT LI46

COMMITMENTS AND CONTINGENT LIABILITIES (Details) ₪ in Thousands, £ in Thousands, $ in Thousands	1 Months Ended	12 Months Ended
	Feb. 28, 2017USD ($)	Dec. 31, 2016USD ($)	Dec. 31, 2016ILS (₪)	Dec. 31, 2016GBP (£)	Dec. 31, 2015USD ($)
Registration Payment Arrangement [Line Items]
Monthly lease amount		$ 172
Future minimum lease commitments
2,017		1,776
2,018		1,608
2,019		659
2,020		188
Total		4,231
Bank guarantee		700
Inventory, Net		5,965			$ 3,602
Subsequent Event [Member]
Future minimum lease commitments
Legal Fees	$ 1,760
Third Party Warehouse [Member]
Future minimum lease commitments
Inventory, Net		156		£ 127
Maximum
Future minimum lease commitments
Bank guarantee		$ 343	₪ 1,320

INCOME TAX (Narrative) (Details

INCOME TAX (Narrative) (Details) - USD ($) $ in Thousands	1 Months Ended	12 Months Ended
	Jan. 31, 2016	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Income Tax [Line Items]
Corporate tax rate (as a percent)	25.00%			25.00%	26.50%	26.50%
Change in corporate tax rate (as a percent)	1.50%					1.50%
Other carryforward				$ 4,067
Operating loss carryforward, subject to limitations				3,413
Deferred Tax Assets, Valuation Allowance				10,471	$ 5,213
Scenario, Forecast [Member]
Income Tax [Line Items]
Corporate tax rate (as a percent)		23.00%	24.00%
Domestic [Member]
Income Tax [Line Items]
Operating loss carryforward				23,100
Deferred Tax Assets, Valuation Allowance				4,867	0
Domestic [Member] | Capital Loss Carryforward [Member]
Income Tax [Line Items]
Other carryforward				13,800
Foreign [Member]
Income Tax [Line Items]
Operating loss carryforward				14,411
Deferred Tax Assets, Valuation Allowance				$ 5,604	$ 5,213

INCOME TAX (Schedule of Deferre

INCOME TAX (Schedule of Deferred Tax Assets) (Details) - USD ($) $ in Thousands	Dec. 31, 2016	Dec. 31, 2015
Income Tax [Line Items]
Operating loss carry forward	$ 13,625	$ 7,656
Reserves and allowances	913	1,629
Net deferred tax assets before valuation allowance	14,538	9,285
Valuation allowance	(10,471)	(5,213)
Net deferred tax assets	4,067	4,072
Domestic [Member]
Income Tax [Line Items]
Net deferred tax assets before valuation allowance	8,987	4,027
Valuation allowance	(4,867)	0
Net deferred tax assets	4,120	4,027
Foreign [Member]
Income Tax [Line Items]
Net deferred tax assets before valuation allowance	5,550	5,258
Valuation allowance	(5,604)	(5,213)
Net deferred tax assets	$ (54)	$ 45

INCOME TAX (Schedule of Income

INCOME TAX (Schedule of Income Tax Reconciliation) (Details) - USD ($) $ in Thousands	1 Months Ended	12 Months Ended
	Jan. 31, 2016	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Domestic		$ (9,634)	$ 915	$ 6,281
Foreign		(2,268)	301	1,595
Income(loss) before income tax, as reported in the consolidated statements of operations		$ (11,902)	$ 1,216	$ 7,876
Statutory tax rate in Israel	25.00%	25.00%	26.50%	26.50%
Theoretical tax expense		$ (2,976)	$ 322	$ 2,087
Current year carryforward losses and other differences for which a valuation allowance was recorded		0	2	67
Changes in valuation allowance		5,257	(211)	(1,332)
Gain from bargain purchase and non-recoverable withholding taxes		(1,516)
Changes in foreign currency exchange rate and other differences		255	44	674
Changes in tax rate		828	0	0
Non-deductible expenses		243	40	179
Actual income tax expense (benefit)		$ 2,091	$ 197	$ 1,675

SHARE CAPITAL (Share Capital) (

SHARE CAPITAL (Share Capital) (Details) $ / shares in Units, $ in Thousands	1 Months Ended	12 Months Ended
	Jun. 30, 2015USD ($)shares	Dec. 31, 2016USD ($)$ / sharesshares	Dec. 31, 2015USD ($)$ / sharesshares	Dec. 31, 2014USD ($)shares	Dec. 31, 2013USD ($)shares	Dec. 31, 2016₪ / sharesshares	Dec. 31, 2015₪ / sharesshares	Aug. 22, 2013₪ / shares
Ordinary shares, par value per share | (per share)						₪ 0.25	₪ 0.25	₪ 0.0588235
Ordinary shares, shares authorized		18,000,000	18,000,000		15,000,000	18,000,000	18,000,000
Issuance of share capital	2,415,000			358,000	3,450,000
Proceeds from issuance of share capital | $				$ 2,458	$ 13,800
Gross proceeds from public offering | $	$ 28,980
Total net proceeds from issuance of share capital | $	$ 27,126	$ 0	$ 27,126	$ 2,458
Treasury shares acquired (in shares)		566,159	774,936
Treasury shares acquired, average cost per share | $ / shares		$ 4.74	$ 4.80
Stock Repurchased and Retired During Period, Shares		1,250,546

SHARE CAPITAL (Additional Stock

SHARE CAPITAL (Additional Stock Option Information) (Details) - USD ($) $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period				4 years
Expiration term				10 years
Options granted	67,833	500,530	36,765	152,949
Exercise price of options granted	$ 2.82	$ 5.8	$ 1.86	$ 0.72
Fair value of options granted		$ 3,974	$ 189	$ 137
Options exercised	8,383	65,411	100,441
Options cancelled		81,000
Weighted-average fair value of options granted	$ 6.2	$ 7.94	$ 5.15
Risk-free interest rate	1.28%		0.34%
Dividend yield	0.00%		0.00%
Expected volatility	362.86%		314.47%
Expected term	3 years 1 month 10 days		1 year 10 months 24 days
Intrinsic value of options exercised	$ 191	$ 138	$ 943
Average stock price	$ 3.78	$ 9.39	$ 9.17
Unrecognized compensation cost	$ 2,704
Year 2014 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Options exercised			31,765
Year 2015 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Options exercised		41,882
Maximum [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expiration term	10 years

SHARE CAPITAL (Schedule of Stoc

SHARE CAPITAL (Schedule of Stock Option Activity) (Details) - $ / shares	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013
Shares Under Options
Outstanding at beginning of year	487,432	137,855	204,931
Granted	67,833	500,530	36,765	152,949
Exercised	(8,383)	(65,411)	(100,441)
Canceled and forfeited	(130,500)	(85,542)	(3,400)
Outstanding at end of year	416,432	487,432	137,855	204,931
Exercisable at end of year	186,253	95,709	44,618
Weighted Average Exercise Price
Outstanding at beginning of year	$ 5.12	$ 2.64	$ 2.06
Granted	2.82	5.8	1.86	$ 0.72
Exercised	1.53	3.1	0.82
Canceled and forfeited	6.96	6.64	13
Outstanding at end of year	4.24	5.12	2.64	$ 2.06
Exercisable at end of year	$ 4.14	$ 4.81	$ 5.9

SHARE CAPITAL (Schedule of St53

SHARE CAPITAL (Schedule of Stock-based Compensation Charge) (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Stock-based compensation charge	$ 924	$ 1,529	$ 173
Cost of revenues [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Stock-based compensation charge	266	264	0
Research and development expenses [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Stock-based compensation charge	207	311	35
Sales and marketing expenses [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Stock-based compensation charge	292	249	0
General and administration expenses [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Stock-based compensation charge	$ 159	$ 705	$ 138

SHARE CAPITAL (Summary of Optio

SHARE CAPITAL (Summary of Options Outstanding and Exercisable) (Details) $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2016USD ($)$ / sharesshares
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Options outstanding | shares	416,432
Weighted average remaining contractual life	3 years 2 months 23 days
Weighted average exercise price	$ 4.24
Aggregate intrinsic value | $	$ 296,177
Options exercisable | shares	186,253
Weighted average exercise price	$ 4.14
Aggregate intrinsic value | $	$ 191,275
Exercise Price Range One [Member]
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Range of exercise price, lower limit	$ 0
Range of exercise price, upper limit	$ 0.85
Options outstanding | shares	97,512
Weighted average remaining contractual life	5 years 7 months 10 days
Weighted average exercise price	$ 0.68
Aggregate intrinsic value | $	$ 264,017
Options exercisable | shares	68,098
Weighted average exercise price	$ 0.68
Aggregate intrinsic value | $	$ 184,555
Exercise Price Range Two [Member]
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Range of exercise price, lower limit	$ 3
Range of exercise price, upper limit	$ 5
Options outstanding | shares	251,148
Weighted average remaining contractual life	2 years 5 months 1 day
Weighted average exercise price	$ 4.1
Aggregate intrinsic value | $	$ 32,160
Options exercisable | shares	87,383
Weighted average exercise price	$ 4.34
Aggregate intrinsic value | $	$ 6,720
Exercise Price Range Three [Member]
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Range of exercise price, lower limit	$ 7
Range of exercise price, upper limit	$ 10
Options outstanding | shares	60,500
Weighted average remaining contractual life	3 years 1 month 17 days
Weighted average exercise price	$ 8.72
Aggregate intrinsic value | $	$ 0
Options exercisable | shares	23,500
Weighted average exercise price	$ 8.67
Aggregate intrinsic value | $	$ 0
Exercise Price Range Four [Member]
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Range of exercise price, lower limit	$ 18.75
Range of exercise price, upper limit	$ 22
Options outstanding | shares	7,272
Weighted average remaining contractual life	3 months 29 days
Weighted average exercise price	$ 19.43
Aggregate intrinsic value | $	$ 0
Options exercisable | shares	7,272
Weighted average exercise price	$ 19.43
Aggregate intrinsic value | $	$ 0

SHARE CAPITAL (Summary of Nonve

SHARE CAPITAL (Summary of Nonvested Options) (Details)	12 Months Ended
	Dec. 31, 2016$ / sharesshares
Options
Non-vested at beginning of year | shares	384,473
Granted | shares	67,883
Vested | shares	(38,295)
Forfeited | shares	(8,000)
Non-vested at end of year | shares	406,061
Weighted-average grant-date fair value
Non-vested at beginning of year | $ / shares	$ 7.04
Granted | $ / shares	27.8
Vested | $ / shares	21.26
Forfeited | $ / shares	7.78
Non-vested at end of period | $ / shares	$ 0.66

SHARE CAPITAL (Schedule of Warr

SHARE CAPITAL (Schedule of Warrant Activity) (Details) - $ / shares	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Number of warrants
Outstanding at beginning of year	4,000	4,000	4,000
Granted		48,055
Exercised		(48,055)
Canceled and forfeited	(4,000)
Outstanding at end of year		4,000	4,000
Exercisable at end of year		4,000	4,000
Weighted average exercise price
Outstanding at beginning of year	$ 20	$ 20	$ 20
Granted		0.38
Exercised		0.38
Canceled and forfeited	20
Outstanding at end of year		20	20
Exercisable at end of year		$ 20	$ 20

RELATED PARTY TRANSACTIONS (Det

RELATED PARTY TRANSACTIONS (Details) - 12 months ended Dec. 31, 2016	USD ($)	ILS (₪)	ILS (₪)
Related Party Transaction [Line Items]
Transaction amount	$ 0
Bank guarantee	700,000
Accrued management services	56,000
Maximum [Member]
Related Party Transaction [Line Items]
Bank guarantee	343,000		₪ 1,320,000
Chairman and CEO [Member]
Related Party Transaction [Line Items]
Bank guarantee	260,000		₪ 1,000,000
Chairman and CEO [Member] | Minimum [Member]
Related Party Transaction [Line Items]
Transaction amount	0	₪ 10,000
Chairman and CEO [Member] | Maximum [Member]
Related Party Transaction [Line Items]
Transaction amount | ₪		₪ 1,965,000
Chief Executive Officer [Member]
Related Party Transaction [Line Items]
Monthly payment	$ 10,600
Bonus as a percentage of net profit	2.00%	2.00%
Bonus as a percentage of revenue	0.50%	0.50%
Chairman [Member]
Related Party Transaction [Line Items]
Monthly fee equal to a percentage of CEO cost	60.00%	60.00%

SEGMENTS, MAJOR CUSTOMERS AND58

SEGMENTS, MAJOR CUSTOMERS AND GEOGRAPHIC INFORMATION (Schedule of Operations by Geographic Area) (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues	$ 20,025	$ 28,340	$ 29,703
Property and equipment, net	1,165	888	616
Africa [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues	5,681	20,425	24,083
Property and equipment, net	0	0	0
European countries [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues	1,211	1,325	3,901
Property and equipment, net	0	0	0
South America [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues	1,803	1,420	1,479
Property and equipment, net	0	0	0
United States [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues	9,888	121	126
Property and equipment, net	122	14	16
Israel [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues	724	161	50
Property and equipment, net	1,043	874	600
Asia Pacific [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues	675	0	0
Property and equipment, net	0
Other [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues	43	109	64
Property and equipment, net	$ 0	$ 0	$ 0

SEGMENTS, MAJOR CUSTOMERS AND59

SEGMENTS, MAJOR CUSTOMERS AND GEOGRAPHIC INFORMATION (Schedule of Revenues from External Customers by Products and Services) (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Revenue from External Customer [Line Items]
Revenues	$ 20,025	$ 28,340	$ 29,703
Raw Materials and Equipment [Member]
Revenue from External Customer [Line Items]
Revenues	3,353	9,427	4,982
Maintenance, Royalties and Project Management [Member]
Revenue from External Customer [Line Items]
Revenues	7,705	18,913	24,721
Electronic Monitoring [Member]
Revenue from External Customer [Line Items]
Revenues	4,437	0	0
Treatment Programs [Member]
Revenue from External Customer [Line Items]
Revenues	$ 4,530	$ 0	$ 0

SEGMENTS, MAJOR CUSTOMERS AND60

SEGMENTS, MAJOR CUSTOMERS AND GEOGRAPHIC INFORMATION (Schedule of Major Customer Concentration) (Details) - Customer [Member] - Sales [Member]	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Customer A [Member]
Concentration Risk [Line Items]
Concentration percentage	6.00%	17.00%	42.00%
Customer B [Member]
Concentration Risk [Line Items]
Concentration percentage	5.00%	30.00%	19.00%
Customer C [Member]
Concentration Risk [Line Items]
Concentration percentage	13.00%	30.00%	18.00%
Customer D [Member]
Concentration Risk [Line Items]
Concentration percentage	0.00%	3.00%	13.00%
Customer E [Member]
Concentration Risk [Line Items]
Concentration percentage	0.00%	9.00%	0.00%
Customer F [Member]
Concentration Risk [Line Items]
Concentration percentage	8.00%	5.00%	5.00%

SEGMENTS, MAJOR CUSTOMERS AND61

SEGMENTS, MAJOR CUSTOMERS AND GEOGRAPHIC INFORMATION (Schedule of Segment Reporting Information, by Segment) (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Revenues	$ 20,025
Operating Loss	(11,599)	$ 1,493	$ 8,009
Property, Plant and Equipment, Net	1,165	$ 888	$ 616
Government Sector [Member]
Revenues	16,738
Operating Loss	(7,970)
Property, Plant and Equipment, Net	906
Cyber [Member]
Revenues	1,760
Operating Loss	(2,072)
Property, Plant and Equipment, Net	84
Connectivity [Member]
Revenues	1,527
Operating Loss	(1,557)
Property, Plant and Equipment, Net	$ 175

OTHER EXPENSES (Schedule of Oth

OTHER EXPENSES (Schedule of Other Expenses) (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Doubtful debt provision	$ 438	$ 1,576	$ 1,225
Acquisition related expenses	165	0	0
Other	110	598	0
Total	$ (713)	$ (2,174)	$ (1,225)

OTHER EXPENSES (Schedule of Bad

OTHER EXPENSES (Schedule of Bad Debt) (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
OTHER EXPENSES [Abstract]
Balance at beginning of period	$ 1,576	$ 4,390	$ 2,084
Provision during the period	1,238	1,576	2,306
Doubtful account classified as bad debt	0	(4,390)	0
Reversal of allowance for doubtful account	(800)	0	0
Balance at end of period	$ 2,014	$ 1,576	$ 4,390

FINANCIAL (EXPENSES) INCOME, 64

FINANCIAL (EXPENSES) INCOME, NET (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Financial expenses:
Interest, bank charges and fees	$ (219)	$ (211)	$ (165)
Exchange differences, net	0	(66)	0
Unwind of discount earn out liability	(118)	0	0
Total financial expenses	(337)	(277)	(165)
Financial income:
Exchange differences, net	34	0	32
Total financial income	34	0	32
Total financial expenses, net	$ (303)	$ (277)	$ (133)