VirtualScopics (VSCP) 10-Q 14 May 15 2015 Q1 Quarterly report Financial data

Document_And_Entity_Informatio

Document And Entity Information	3 Months Ended
	Mar. 31, 2015	11-May-15
Document Information [Line Items]
Entity Registrant Name	VirtualScopics, Inc.
Entity Central Index Key	1307752
Current Fiscal Year End Date	-19
Entity Filer Category	Smaller Reporting Company
Trading Symbol	VSCP
Entity Common Stock, Shares Outstanding		2,994,928
Document Type	10-Q
Amendment Flag	FALSE
Document Period End Date	31-Mar-15
Document Fiscal Period Focus	Q1
Document Fiscal Year Focus	2015

Condensed_Consolidated_Balance

Condensed Consolidated Balance Sheet (USD $)	Mar. 31, 2015	Dec. 31, 2014
Current assets
Cash	$2,393,968	$4,046,599
Accounts receivable, net	2,097,513	1,814,143
Prepaid expenses and other current assets	535,549	410,188
Total current assets	5,027,030	6,270,930
Patents, net	1,166,284	1,211,770
Property and equipment, net	337,174	330,873
Other Assets	8,486	10,661
Total assets	6,538,974	7,824,234
Current liabilities
Accounts payable and accrued expenses	1,015,871	1,289,099
Accrued payroll	414,966	681,964
Unearned revenue	475,299	670,332
Dividends payable	335,333	335,333
Total current liabilities	2,241,469	2,976,728
Commitments and Contingencies
Stockholders' Equity
Common stock, $0.001 par value; 20,000,000 shares authorized; issued and outstanding, 2,994,928 shares at March 31, 2015 and December 31, 2014	2,995	2,995
Additional paid-in capital	21,977,738	21,975,069
Accumulated deficit	-17,683,234	-17,130,564
Total stockholders' equity	4,297,505	4,847,506
Total liabilities and stockholders' equity	6,538,974	7,824,234
Convertible Preferred Stock Series A [Member]
Stockholders' Equity
Convertible preferred stock	2	2
Convertible Preferred Stock Series B [Member]
Stockholders' Equity
Convertible preferred stock	1	1
Convertible Preferred Stock Series C - 1 [Member]
Stockholders' Equity
Convertible preferred stock	3	3
Convertible Preferred Stock Series C - 2 [Member]
Stockholders' Equity
Convertible preferred stock	$0	$0

Condensed_Consolidated_Balance1

Condensed Consolidated Balance Sheet [Parenthetical] (USD $)	Mar. 31, 2015	Dec. 31, 2014
Convertible preferred stock, par value (in dollars per share)	$0.00	$0.00
Convertible preferred stock, shares authorized	1,000,000	1,000,000
Common stock, par value (in dollars per share)	$0.00	$0.00
Common stock, shares authorized	20,000,000	20,000,000
Common stock, shares issued	2,994,928	2,994,928
Common stock, shares outstanding	2,994,928	2,994,928
Convertible Preferred Stock Series A [Member]
Convertible preferred stock, shares authorized	8,400	8,400
Convertible preferred stock, shares issued	2,165	2,165
Convertible preferred stock, shares outstanding	2,165	2,165
Convertible preferred stock, liquidation preference (in dollars per share)	$1,000	$1,000
Convertible Preferred Stock Series B [Member]
Convertible preferred stock, shares authorized	6,000	6,000
Convertible preferred stock, shares issued	600	600
Convertible preferred stock, shares outstanding	600	600
Convertible preferred stock, liquidation preference (in dollars per share)	$1,000	$1,000
Convertible Preferred Stock Series C - 1 [Member]
Convertible preferred stock, shares authorized	3,000	3,000
Convertible preferred stock, shares issued	3,000	3,000
Convertible preferred stock, shares outstanding	3,000	3,000
Convertible preferred stock, liquidation preference (in dollars per share)	$1,000	$1,000
Convertible Preferred Stock Series C - 2 [Member]
Convertible preferred stock, shares authorized	3,000	3,000
Convertible preferred stock, shares issued	0	0
Convertible preferred stock, shares outstanding	0	0
Convertible preferred stock, liquidation preference (in dollars per share)	$1,000	$1,000

Condensed_Consolidated_Stateme

Condensed Consolidated Statement of Operations (USD $)	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
Revenues	$2,641,221	$2,246,954
Reimbursement revenues	173,221	106,032
Total revenues	2,814,442	2,352,986
Cost of services	1,666,644	1,489,079
Cost of reimbursement revenues	173,221	106,032
Total cost of services	1,839,865	1,595,111
Gross profit	974,577	757,875
Operating expenses
Research and development	349,837	285,896
Sales and marketing	280,397	345,077
General and administrative	799,386	687,002
Depreciation and amortization	96,972	86,502
Total operating expenses	1,526,592	1,404,477
Operating loss	-552,015	-646,602
Other income (expense)
Other income	259	1,037
Other expense	-914	-808
Total other (expense) income	-655	229
Net loss	-552,670	-646,373
Preferred stock dividends	42,000	42,000
Net loss available to common stockholders	($594,670)	($688,373)
Weighted average basic and diluted shares outstanding (in shares)	2,994,928	2,991,990
Basic and diluted loss per share (in dollars per share)	($0.20)	($0.23)

Condensed_Consolidated_Stateme1

Condensed Consolidated Statements of Cash Flows (USD $)	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
Cash flows from operating activities
Net loss	($552,670)	($646,373)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	96,972	86,502
Stock-based compensation	44,669	41,388
Changes in operating assets and liabilities
Accounts receivable	-283,370	82,278
Prepaid expenses and other assets	-123,186	-34,768
Accounts payable and accrued expenses	-273,228	112,182
Accrued payroll	-266,998	-341,639
Unearned revenue	-195,033	283,959
Total adjustments	-1,000,174	229,902
Net cash used in operating activities	-1,552,844	-416,471
Cash flows from investing activities
Purchases of property and equipment	-52,882	-28,563
Patent applications and maintenance	-4,905	-6,024
Net cash used in investing activities	-57,787	-34,587
Cash flows from financing activities
Cash dividends on series B preferred stock	-42,000	-42,000
Net cash used in financing activities	-42,000	-42,000
Net decrease in cash	-1,652,631	-493,058
Cash
Beginning of period	4,046,599	7,330,630
End of period	$2,393,968	$6,837,572

Nature_of_Business_and_Basis_o

Nature of Business and Basis of Presentation	3 Months Ended
	Mar. 31, 2015
Organization and Basis Of Presentation [Abstract]
Organization, Consolidation and Presentation of Financial Statements Disclosure [Text Block]	NOTE 1 - Nature of Business and Basis of Presentation
	Nature of Business
	The headquarters of VirtualScopics. Inc. and its wholly-owned subsidiary, VirtualScopics, LLC (the “Subsidiary” and, together, the “Company”) are located in Rochester, New York. The Company has created a suite of image analysis software tools and applications which are used in detecting and measuring specific anatomical structures and metabolic activity using medical images. The Company’s developed proprietary software provides measurement capabilities designed to improve pharmaceutical and medical device research and development and improve clinical medical image analysis.
	Basis of Presentation
	The accompanying unaudited condensed consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information pursuant to article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for condensed financial statements and should be read in conjunction with the audited consolidated financial statements and notes related thereto contained in the Company’s Annual Report on Form 10-K as of and for the year ended December 31, 2014. In the opinion of management, these financial statements contain all adjustments necessary for a fair presentation for and as of the end of the interim period, all of which were normal recurring adjustments. The results of operations for the three months ended March 31, 2015 are not necessarily indicative of the results to be expected for the full year ending December 31, 2015.

Liquidity_and_Financial_Condit

Liquidity and Financial Condition	3 Months Ended
	Mar. 31, 2015
Liquidity and Financial Condition [Abstract]
Liquidity and Financial Condition [Text Block]	NOTE 2 – Liquidity and Financial Condition
	The Company had a net loss attributable to common stockholders of $552,670 for the three months ended March 31, 2015. At March 31, 2015, the Company’s accumulated deficit amounted to $17,683,234 and the Company had working capital of $2,785,561. The Company’s future plans and growth are dependent on its ability to increase revenues and continue its business development efforts surrounding its contract award backlog. If the Company continues to incur losses and revenues do not generate from the backlog as expected, the Company may need to raise additional capital to expand its business and continue as a going concern. The Company currently anticipates that its cash and cash equivalents will be sufficient to meet its working capital requirements to continue its sales and marketing and research and development efforts for at least 12 months. If in the future our plans or assumptions change or prove to be inaccurate, the Company may need to raise additional funds through public or private debt or equity offerings financings, corporate collaborations or other means. The Company may also be required to reduce operating expenditures or investments in its infrastructure. The Company has not secured any commitment for new financing at this time, nor can it provide any assurance that other new financings will be available on commercially acceptable terms, if needed. If the Company is unable to secure additional capital, it may be required to curtail its research and development activities and take additional measures in reducing costs to conserve its cash.

Summary_of_Certain_Significant

Summary of Certain Significant Accounting Policies	3 Months Ended
	Mar. 31, 2015
Accounting Policies [Abstract]
Significant Accounting Policies [Text Block]	NOTE 3 - Summary of Certain Significant Accounting Policies
	Principles of Consolidation
	The accompanying condensed consolidated financial statements include the accounts of the Company and the Subsidiary. All significant intercompany balances and transactions have been eliminated in consolidation.
	Use of Estimates
	The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the year. Actual results could differ from those estimates. Estimates included in these consolidated financial statements relate to assessing the collectability of accounts receivable, the valuation of securities underlying share-based compensation, realization of deferred tax assets, tax contingencies and any related valuation allowance, and the useful lives and potential impairment of the Company’s property and equipment and intangible assets. Estimates and assumptions are reviewed periodically and the effects of revisions are reflected in the period that they are determined to be necessary.
	Revenue Recognition
	The Company recognizes revenue when it is realized or realizable and earned. The Company considers revenue realized or realizable and earned when an agreement exists, services and products have been performed or delivered, as the case may be, prices are fixed or determinable, and collectability is reasonably assured. Revenues are reduced for estimated discounts and other allowances, if any.
	The Company provides advanced medical image analysis on a per analysis basis, and recognizes revenue when the image analysis is completed. Revenue related to project, data and site management services is recognized as the services are rendered and in accordance with the terms of the contract. Consulting revenue is recognized once the services are rendered and typically charged at an hourly rate.
	Reimbursements received and related costs incurred for out-of-pocket expenses are separately reported as revenue and cost of services, respectively, in the financial statements.
	Income Taxes
	In its interim financial statements, the Company follows the guidance of Accounting Standards Codification (“ASC”) 270 “Interim Reporting” and ASC 740 “Income Taxes” whereby it uses the expected annual effective tax rate in determining its interim tax provisions. Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized based upon the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases, and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in operations in the period that includes the enactment date. A valuation allowance is provided when it is more likely than not that some portion or all of a deferred tax asset will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income and the reversal of deferred tax liabilities during the period in which related temporary differences become deductible. The benefit of tax positions taken or expected to be taken in the Company’s income tax returns are recognized in the consolidated financial statements if such positions are more likely than not of being sustained.
	Research and Development
	Research and development expense relates to the development of new applications and processes including improvements and enhancements to existing software applications. These costs are expensed as incurred.

StockBased_Compensation

Stock-Based Compensation	3 Months Ended
	Mar. 31, 2015
Disclosure Of Compensation Related Costs, Share-Based Payments [Abstract]
Disclosure of Compensation Related Costs, Share-based Payments [Text Block]	NOTE 4 - Stock-Based Compensation
	For the three months ended March 31, 2015 and 2014, the Company’s condensed consolidated statements of operations reflect stock-based compensation expense for stock options granted and restricted stock awards under its long-term incentive plans and allocated as follows:
		Three Months Ended
		March 31,
		2015			2014
	Cost of service revenues	$	9,096		$	11,041
	Research and development		9,053			9,573
	Sales and marketing		3,179			2,691
	General and administrative		23,341			18,083
	Total stock-based compensation	$	44,669		$	41,388
	Stock options issued under the Company’s long-term incentive plans are granted with an exercise price equal to but no less than the market price of the Company’s stock at the date of grant and expire up to ten years from the date of grant. These options generally vest over a three or four-year period from the date of grant. As of March 31, 2015, there was $355,403 of total unrecognized compensation cost related to non-vested share-based compensation arrangements. This cost is expected to be recognized over a remaining weighted-average vesting period of 3.08 years.
	The fair value of stock options granted was determined on the grant date using assumptions for risk free interest rate, the expected term, expected volatility, and expected dividend yield. The risk free interest rate is based on U.S. Treasury zero-coupon yield curve over the expected term of the option. The expected term assumption is determined using the weighted average midpoint between the vesting and expiration term for all individuals within the grant. The Company estimated its expected volatility using its own historical stock prices. The Company’s model includes a zero dividend yield assumption, as the Company has not historically paid nor does it anticipate paying dividends on its common stock. The Company’s model does not include a discount for post-vesting restrictions, as the Company has not issued awards with such restrictions. The periodic expense is then determined based on the valuation of the options, and at that time an estimated forfeiture rate is used to reduce the expense recorded. The Company’s estimate of pre-vesting forfeitures is primarily based on the Company’s historical experience and is adjusted to reflect actual forfeitures as the options vest. The following assumptions were used to estimate the fair value of options granted for the three months ended March 31, 2015 and 2014 using the Black-Scholes option-pricing model:
		March 31,
		2015		2014
	Risk free interest rate	1.8	%	1.9	%
	Expected term (years)	6		5.9
	Expected volatility	63.5	%	64.5	%
	Expected dividend yield	-		-
	A summary of the employee stock option activity for the three months ended March 31, 2015 is as follows:
		Number of			Weighted		Weighted
		Shares			Average		Average
					Exercise		Remaining
					Price		Contractual
							Term
	Options outstanding at January 1, 2015		404,612		$	10.03
	Granted		13,000			3.78
	Exercised		-
	Cancelled/Forfeited		-1,748			-11.28
	Expired		-11,167			-10.1
	Options outstanding at March 31, 2015		404,697			9.82		6.36
	Options exercisable at March 31, 2015		199,320			15.41		3.47
	The weighted-average grant-date fair value of options granted during the three months ended March 31, 2015 and 2014 was $28,924 and $2,511, respectively.

Stockholders_Equity

Stockholders' Equity	3 Months Ended
	Mar. 31, 2015
Stockholders Equity Note [Abstract]
Stockholders' Equity Note Disclosure [Text Block]	NOTE 5 - Stockholders’ Equity
	As of March 31, 2015, the Company has authorized 1,000,000 shares of preferred stock, par value $0.001 per share, of which 8,400 are designated as Series A Convertible Preferred Stock (“Series A”), 6,000 are designated as Series B Convertible Preferred Stock (“Series B”), 3,000 are designated as Series C-1 Convertible Preferred Stock (“Series C-1”), and 3,000 are designated as Series C-2 Convertible Preferred Stock (“Series C-2”) as specified in the Certificate of Designation (the “Certificate”). There were no conversions of the Company’s convertible Series A, B and C-1 preferred stock during the three months ended March 31, 2015 and 2014.
	Each share of Series A is convertible into 83.036 shares of the Company’s common stock and is senior in liquidation preference in comparison to shares of the Company’s common stock.
	Each share of Series B is convertible into 83.036 shares of the Company’s common stock and has a liquidation preference that is pari passu with the Company’s Series A and senior to the Company’s common stock. Cumulative dividends on the Series B accrue on the stated value of $1,000 per share at an annual rate of 8%, payable monthly in cash and/or shares of the Company’s common stock at the option of the Company. Subject to certain exceptions, the Series B holders are only entitled to be paid dividends if full dividends are first paid or concurrently paid to the holders of the Series C-1. As of March 31, 2015 and December 31, 2014, there was $96,000 of accrued dividends payable to Series B stockholders. During the three months ended March 31, 2015 and 2014, cash dividends paid to Series B stockholders aggregated to $12,000.
	Each share of Series C-1 is convertible into shares of the Company’s common stock at a conversion rate determined by dividing (i) the stated value per share of $1,000, plus, if consented to by the Company, all accrued and unpaid dividends, by (ii) the conversion price of $12.043. The Series C-1 is senior in liquidation preference in comparison to shares of the Company’s common stock and the Series A and Series B preferred stock. Cumulative dividends on the Series C accrue on the stated value of $1,000 per share at an annual rate of 4%. As of March 31, 2015 and December 31, 2014, there was $239,333 of accrued dividends payable to Series C-1 stockholders. During the three months ended March 31, 2015 and 2014, cash dividends paid to Series C-1 stockholders aggregated to $30,000.

Loss_Per_Share

Loss Per Share	3 Months Ended
	Mar. 31, 2015
Earnings Per Share [Abstract]
Earnings Per Share [Text Block]	NOTE 5 – Loss Per Share
	Basic earnings and loss per share are computed by dividing the net income or loss available to common stockholders by the weighted average number of common shares outstanding during the period. Diluted earnings per share is computed using the weighted average number of common shares and, if dilutive, potential common shares outstanding during the period. Potential common shares consist of the incremental common shares issuable upon the exercise of stock options (using the treasury stock method) and the conversion of the Company’s convertible preferred stock and warrants (using the if-converted method). Diluted loss per share excludes the shares issuable upon the conversion of preferred stock, the exercise of stock options and warrants from the calculation of net loss per share as their effect would be antidilutive.
	Securities that could potentially dilute earnings per share in the future that were not included in the computation of diluted loss per share consist of the following numbers of shares into which preferred stock could have been converted and shares for which outstanding options and warrants could have been exercised during the three months ending March 31, 2015 and 2014:
		2015		2014
	Convertible preferred stock		478,701		480,777
	Warrants to purchase common stock		136,132		233,753
	Options to purchase common stock		404,697		247,002
	Total		1,019,530		961,532

Income_Taxes

Income Taxes	3 Months Ended
	Mar. 31, 2015
Income Tax Disclosure [Abstract]
Income Tax Disclosure [Text Block]	NOTE 6 - Income Taxes
	The Company has significant net operating loss and business credit carryovers which are subject to a valuation allowance due to the uncertain nature of the realization of the losses. The Internal Revenue Code imposes certain limitations on the utilization of net operating loss carryovers and other tax attributes after a change in control. The Company does not believe it has encountered ownership changes which could significantly limit the possible utilization of such carryovers. It is not anticipated that limitations, if any, would have a material impact on the condensed consolidated balance sheet as a result of offsetting changes in the deferred tax valuation allowance. Based on all available evidence, the Company believes that its deferred tax assets should be fully reserved as of March 31, 2015 because it is still currently more likely than not that the benefits of the Company’s deferred tax assets will not be realized in future periods. The Company will continue to assess the likelihood of recognizing a portion of its deferred tax assets and will make an assessment of whether it should reduce the valuation allowance.
	The Company will recognize interest and penalties accrued related to unrecognized tax benefits as components of its income tax provision. As of March 31, 2015, the Company does not have any interest and penalties accrued related to unrecognized tax benefits.

Concentration_of_Credit_Risk

Concentration of Credit Risk	3 Months Ended
	Mar. 31, 2015
Risks and Uncertainties [Abstract]
Concentration Risk Disclosure [Text Block]	NOTE 7 - Concentration of Credit Risk
	The Company’s top three customers accounted for approximately 21%, 20%, and 18% of total revenue for the three months ended March 31, 2015. Three customers accounted for 32%, 23%, and 14% of total revenue for the three months ended March 31, 2014.
	Five customers accounted for approximately 23%, 19%, 16%, 14%, and 11% of accounts receivable as of March 31, 2015. Three customers accounted for approximately 27%, 19%, and 18% of accounts receivable as of December 31, 2014.

Related_Party

Related Party	3 Months Ended
	Mar. 31, 2015
Related Party Transactions [Abstract]
Related Party Transactions Disclosure [Text Block]	NOTE 8 – Related Party
	In April 2012, the Company issued Merck Global Health Innovation Fund, LLC (“Merck”) 3,000 shares of Series C-1 which are convertible into 249,107 shares of common stock and Series C-1 Warrants which are exercisable to purchase 136,132 shares of common stock. Revenues generated from Merck were $98,664 and $23,115 for the three months ended March 31, 2015 and 2014, respectively. The accounts receivable balance due from Merck was $65,488 and $95,985 as of March 31, 2015 and December 31, 2014, respectively.

Subsequent_Events

Subsequent Events	3 Months Ended
	Mar. 31, 2015
Subsequent Events [Abstract]
Subsequent Events [Text Block]	NOTE 9 - Subsequent Events
	The Company evaluates events that have occurred after the balance sheet date but before the financial statements are issued. Based upon the evaluation, the Company did not identify any recognized or non-recognized subsequent events that would have required adjustment or disclosure in the condensed consolidated financial statements.

Summary_of_Certain_Significant1

Summary of Certain Significant Accounting Policies (Policies)	3 Months Ended
	Mar. 31, 2015
Accounting Policies [Abstract]
Consolidation, Policy [Policy Text Block]	Principles of Consolidation
	The accompanying condensed consolidated financial statements include the accounts of the Company and the Subsidiary. All significant intercompany balances and transactions have been eliminated in consolidation.
Use of Estimates, Policy [Policy Text Block]	Use of Estimates
	The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the year. Actual results could differ from those estimates. Estimates included in these consolidated financial statements relate to assessing the collectability of accounts receivable, the valuation of securities underlying share-based compensation, realization of deferred tax assets, tax contingencies and any related valuation allowance, and the useful lives and potential impairment of the Company’s property and equipment and intangible assets. Estimates and assumptions are reviewed periodically and the effects of revisions are reflected in the period that they are determined to be necessary.
Revenue Recognition, Policy [Policy Text Block]	Revenue Recognition
	The Company recognizes revenue when it is realized or realizable and earned. The Company considers revenue realized or realizable and earned when an agreement exists, services and products have been performed or delivered, as the case may be, prices are fixed or determinable, and collectability is reasonably assured. Revenues are reduced for estimated discounts and other allowances, if any.
	The Company provides advanced medical image analysis on a per analysis basis, and recognizes revenue when the image analysis is completed. Revenue related to project, data and site management services is recognized as the services are rendered and in accordance with the terms of the contract. Consulting revenue is recognized once the services are rendered and typically charged at an hourly rate.
	Reimbursements received and related costs incurred for out-of-pocket expenses are separately reported as revenue and cost of services, respectively, in the financial statements.
Income Tax, Policy [Policy Text Block]	Income Taxes
	In its interim financial statements, the Company follows the guidance of Accounting Standards Codification (“ASC”) 270 “Interim Reporting” and ASC 740 “Income Taxes” whereby it uses the expected annual effective tax rate in determining its interim tax provisions. Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized based upon the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases, and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in operations in the period that includes the enactment date. A valuation allowance is provided when it is more likely than not that some portion or all of a deferred tax asset will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income and the reversal of deferred tax liabilities during the period in which related temporary differences become deductible. The benefit of tax positions taken or expected to be taken in the Company’s income tax returns are recognized in the consolidated financial statements if such positions are more likely than not of being sustained.
Research and Development Expense, Policy [Policy Text Block]	Research and Development
	Research and development expense relates to the development of new applications and processes including improvements and enhancements to existing software applications. These costs are expensed as incurred.

StockBased_Compensation_Tables

Stock-Based Compensation (Tables)	3 Months Ended
	Mar. 31, 2015
Disclosure Of Compensation Related Costs, Share-Based Payments [Abstract]
Schedule of Share-based Compensation, Stock Options, Activity [Table Text Block]	For the three months ended March 31, 2015 and 2014, the Company’s condensed consolidated statements of operations reflect stock-based compensation expense for stock options granted and restricted stock awards under its long-term incentive plans and allocated as follows:
		Three Months Ended
		March 31,
		2015			2014
	Cost of service revenues	$	9,096		$	11,041
	Research and development		9,053			9,573
	Sales and marketing		3,179			2,691
	General and administrative		23,341			18,083
	Total stock-based compensation	$	44,669		$	41,388
Schedule of Share-based Compensation, Activity [Table Text Block]	The following assumptions were used to estimate the fair value of options granted for the three months ended March 31, 2015 and 2014 using the Black-Scholes option-pricing model:
		March 31,
		2015		2014
	Risk free interest rate	1.8	%	1.9	%
	Expected term (years)	6		5.9
	Expected volatility	63.5	%	64.5	%
	Expected dividend yield	-		-
Schedule of Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Table Text Block]	A summary of the employee stock option activity for the three months ended March 31, 2015 is as follows:
		Number of			Weighted		Weighted
		Shares			Average		Average
					Exercise		Remaining
					Price		Contractual
							Term
	Options outstanding at January 1, 2015		404,612		$	10.03
	Granted		13,000			3.78
	Exercised		-
	Cancelled/Forfeited		-1,748			-11.28
	Expired		-11,167			-10.1
	Options outstanding at March 31, 2015		404,697			9.82		6.36
	Options exercisable at March 31, 2015		199,320			15.41		3.47

Loss_Per_Share_Tables

Loss Per Share (Tables)	3 Months Ended
	Mar. 31, 2015
Earnings Per Share [Abstract]
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share [Table Text Block]	Securities that could potentially dilute earnings per share in the future that were not included in the computation of diluted loss per share consist of the following numbers of shares into which preferred stock could have been converted and shares for which outstanding options and warrants could have been exercised during the three months ending March 31, 2015 and 2014:
		2015		2014
	Convertible preferred stock		478,701		480,777
	Warrants to purchase common stock		136,132		233,753
	Options to purchase common stock		404,697		247,002
	Total		1,019,530		961,532

Liquidity_and_Financial_Condit1

Liquidity and Financial Condition (Details Textual) (USD $)	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014	Dec. 31, 2014
Working Capital	$2,785,561
Retained Earnings (Accumulated Deficit)	-17,683,234		-17,130,564
Net Income (Loss) Attributable To Parent	($552,670)	($646,373)

StockBased_Compensation_Detail

Stock-Based Compensation (Details) (USD $)	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
Stock-based compensation	$44,669	$41,388
Cost of service revenues [Member]
Stock-based compensation	9,096	11,041
Research and development [Member]
Stock-based compensation	9,053	9,573
Sales and marketing [Member]
Stock-based compensation	3,179	2,691
General and administrative [Member]
Stock-based compensation	$23,341	$18,083

StockBased_Compensation_Detail1

Stock-Based Compensation (Details 1)	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
Risk free interest rate	1.80%	1.90%
Expected term (years)	6 years	5 years 10 months 24 days
Expected volatility	63.50%	64.50%
Expected dividend yield	0.00%	0.00%

StockBased_Compensation_Detail2

Stock-Based Compensation (Details 2) (USD $)	3 Months Ended
	Mar. 31, 2015
Options outstanding - Number of Shares at January 1, 2015	404,612
Granted - Number of Shares	13,000
Exercised - Number of Shares	0
Cancelled/Forfeited - Number of Shares	-1,748
Expired - Number of Shares	-11,167
Options outstanding - Number of Shares at March 31, 2015	404,697
Options exercisable - Number of Shares at March 31, 2015	199,320
Beginning balance, Options outstanding - Weighted Average Exercise Price	$10.03
Granted - Weighted Average Exercise Price	$3.78
Cancelled/Forfeited - Weighted Average Exercise Price	($11.28)
Expired - Weighted Average Exercise Price	($10.10)
Ending balance, Options outstanding - Weighted Average Exercise Price	$9.82
Options exercisable - Weighted Average Exercise Price	$15.41
Options outstanding - Weighted Average Remaining Contractual Term (in years)	6 years 4 months 10 days
Options exercisable - Weighted Average Remaining Contractual Term (in years)	3 years 5 months 19 days

StockBased_Compensation_Detail3

Stock-Based Compensation (Details Textual) (USD $)	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized, Total	$355,403
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized, Period for Recognition	3 years 29 days
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Weighted Average Grant Date Fair Value	$28,924	$2,511
Share-based Compensation Arrangement by Share-based Payment Award, Expiration Period	10 years
Maximum [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period	4 years
Minimum [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period	3 years

Stockholders_Equity_Details_Te

Stockholders' Equity (Details Textual) (USD $)	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014	Dec. 31, 2014
Convertible preferred stock, shares authorized	1,000,000		1,000,000
Preferred Stock, Par or Stated Value Per Share	$0.00		$0.00
Cash dividends on preferred stock	$42,000	$42,000
Series A Convertible Preferred Stock [Member]
Preferred Stock Designated During Period Shares	8,400
Stock Conversion Ratio	83.036
Series C-1 Convertible Preferred Stock [Member]
Preferred Stock Designated During Period Shares	3,000
Preferred Stock, Liquidation Preference Per Share	$1,000
Preferred Stock Conversion Price Per Share	$12.04
Interest and Dividends Payable, Total	239,333		239,333
Cash dividends on preferred stock	30,000	30,000
Preferred Stock, Dividend Rate, Percentage	4.00%
Cumulative dividend per share	$1,000
Series C-2 Convertible Preferred Stock [Member]
Convertible preferred stock, shares authorized	3,000		3,000
Preferred Stock Designated During Period Shares	3,000
Preferred Stock, Liquidation Preference Per Share	$1,000		$1,000
Series B Convertible Preferred Stock [Member]
Preferred Stock Designated During Period Shares	6,000
Preferred Stock, Liquidation Preference Per Share	$1,000
Interest and Dividends Payable, Total	96,000		96,000
Stock Conversion Ratio	83.036
Annual Dividend Rate	8.00%
Cash dividends on preferred stock	$12,000	$12,000

Loss_Per_Share_Details

Loss Per Share (Details)	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount	1,019,530	961,532
Convertible preferred stock [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount	478,701	480,777
Warrants To Purchase Common Stock [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount	136,132	233,753
Stock options to purchase common stock [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount	404,697	247,002

Concentration_of_Credit_Risk_D

Concentration of Credit Risk (Details Textual)	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014	Dec. 31, 2014
Customer 1 [Member]
Entity-Wide Accounts Receivable, Major Customer, Percentage	23.00%		27.00%
Concentration Risk, Percentage	21.00%	32.00%
Customer 2 [Member]
Entity-Wide Accounts Receivable, Major Customer, Percentage	19.00%		19.00%
Concentration Risk, Percentage	20.00%	23.00%
Customer 3 [Member]
Entity-Wide Accounts Receivable, Major Customer, Percentage	16.00%		18.00%
Concentration Risk, Percentage	18.00%	14.00%
Customer 4 [Member]
Entity-Wide Accounts Receivable, Major Customer, Percentage	14.00%
Customer 5 [Member]
Entity-Wide Accounts Receivable, Major Customer, Percentage	11.00%

Related_Party_Details_Textual

Related Party (Details Textual) (USD $)	3 Months Ended		1 Months Ended
	Mar. 31, 2015	Mar. 31, 2014	Apr. 30, 2012	Dec. 31, 2014
Revenue from Related Parties	$98,664	$23,115
Accounts Receivable, Related Parties	$65,488			$95,985
Common Stock [Member]
Common stock issuable upon conversion of preferred stock			249,107
Series C-1 Preferred Stock [Member]
Preferred Stock and Warrant Purchase Agreement Shares Issued			3,000
Series C-1 Warrants [Member]
Preferred Stock and Warrant Purchase Agreement, Warrants Issued To Acquire Common Stock Shares, Number			136,132