Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2019 | May 10, 2019 | |
Document And Entity Information | ||
Entity Registrant Name | Where Food Comes From, Inc. | |
Entity Central Index Key | 0001360565 | |
Document Type | 10-Q | |
Trading Symbol | WFCF | |
Document Period End Date | Mar. 31, 2019 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Reporting Status Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Common Stock, Shares Outstanding | 24,921,498 | |
Document Fiscal Period Focus | Q1 | |
Document Fiscal Year Focus | 2019 |
Consolidated Balance Sheets (Un
Consolidated Balance Sheets (Unaudited) - USD ($) | Mar. 31, 2019 | Dec. 31, 2018 |
Current assets: | ||
Cash and cash equivalents | $ 2,452,477 | $ 1,482,391 |
Accounts receivable, net of allowance | 2,005,766 | 2,205,162 |
Short-term investments in certificates of deposit | 246,506 | 245,597 |
Prepaid expenses and other current assets | 428,619 | 439,424 |
Total current assets | 5,133,368 | 4,372,574 |
Property and equipment, net | 1,765,595 | 1,675,472 |
Operating lease right-of-use assets | 3,359,810 | |
Long-term investments in certificates of deposit | 254,246 | 252,999 |
Investment in Progressive Beef | 991,115 | 991,115 |
Intangible and other assets, net | 3,698,000 | 3,852,121 |
Goodwill | 3,143,734 | 3,143,734 |
Deferred tax assets, net | 203,923 | 175,923 |
Total assets | 18,549,791 | 14,463,938 |
Current liabilities: | ||
Accounts payable | 691,562 | 533,925 |
Accrued expenses and other current liabilities | 567,935 | 419,619 |
Customer deposits and deferred revenue | 1,362,882 | 727,854 |
Current portion of notes payable | 10,299 | 10,173 |
Current portion of finance lease obligations | 7,303 | 11,309 |
Current portion of operating lease obligations | 210,847 | |
Total current liabilities | 2,850,828 | 1,702,880 |
Notes payable, net of current portion | 30,440 | 32,220 |
Finance lease obligations, net of current portion | 31,968 | 32,747 |
Operating lease obligation net of current portion | 3,647,424 | |
Deferred rent liability | 119,187 | |
Lease incentive obligation | 362,088 | |
Total liabilities | 6,560,660 | 2,249,122 |
Commitments and contingencies | ||
Contingently redeemable non-controlling interest | 1,405,172 | 1,449,007 |
Equity: | ||
Preferred stock, $0.001 par value; 5,000,000 shares authorized; none issued or outstanding | ||
Common stock, $0.001 par value; 95,000,000 shares authorized; 25,473,115 (2019) and 25,473,115 (2018) shares issued, and 24,921,498 (2019) and 24,968,256 (2018) shares outstanding | 25,473 | 25,473 |
Additional paid-in-capital | 11,075,966 | 11,031,264 |
Treasury stock of 551,617 (2019) and 504,859 (2018) shares | (1,192,484) | (1,109,061) |
Retained earnings | 675,004 | 818,133 |
Total equity | 10,583,959 | 10,765,809 |
Total liabilities and stockholders' equity | $ 18,549,791 | $ 14,463,938 |
Consolidated Balance Sheets (_2
Consolidated Balance Sheets (Unaudited) (Parenthetical) - $ / shares | Mar. 31, 2019 | Dec. 31, 2018 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, authorized | 5,000,000 | 5,000,000 |
Preferred stock, issued | ||
Preferred stock, outstanding | ||
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, authorized | 95,000,000 | 95,000,000 |
Common stock, issued | 25,473,115 | 25,473,115 |
Common stock, outstanding | 24,921,498 | 24,968,256 |
Treasury stock, shares | 551,617 | 504,859 |
Consolidated Statements of Oper
Consolidated Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Revenues: | ||
Total revenues | $ 3,954,540 | $ 3,620,802 |
Costs of revenues: | ||
Total costs of revenues | 2,288,814 | 1,889,479 |
Gross profit | 1,665,726 | 1,731,323 |
Selling, general and administrative expenses | 1,966,339 | 1,704,474 |
(Loss)/income from operations | (300,613) | 26,849 |
Other expense (income): | ||
Dividend income from Progressive Beef | (30,000) | |
Other income, net | (2,696) | (2,918) |
Gain on sale of assets | 1,000 | |
Interest expense | 3,047 | 1,079 |
(Loss)/income before income taxes | (269,964) | 28,688 |
Income tax (benefit)/expense | (83,000) | 8,000 |
Net (loss)/income | (186,964) | 20,688 |
Net loss attributable to non-controlling interest | 43,835 | 14,796 |
Net (loss)/income attributable to Where Food Comes From, Inc. | $ (143,129) | $ 35,484 |
Weighted average number of common shares outstanding: | ||
Basic (in shares) | 24,957,082 | 24,648,610 |
Diluted (in shares) | 24,957,082 | 24,845,002 |
Verification and Certification Service Revenue [Member] | ||
Revenues: | ||
Total revenues | $ 2,811,694 | $ 2,796,194 |
Costs of revenues: | ||
Total costs of revenues | 1,562,090 | 1,450,609 |
Product Sales [Member] | ||
Revenues: | ||
Total revenues | 641,058 | 353,894 |
Costs of revenues: | ||
Total costs of revenues | 443,185 | 225,975 |
Software License, Maintenance and Support Services Revenue [Member] | ||
Revenues: | ||
Total revenues | 295,029 | 287,444 |
Costs of revenues: | ||
Total costs of revenues | 154,003 | 137,434 |
Software-Related Consulting Service Revenue [Member] | ||
Revenues: | ||
Total revenues | 206,759 | 183,270 |
Costs of revenues: | ||
Total costs of revenues | $ 129,536 | $ 75,461 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Operating activities: | ||
Net (loss)/income | $ (186,964) | $ 20,688 |
Adjustments to reconcile net (loss) income to net cash provided by operating activities: | ||
Depreciation and amortization | 260,121 | 272,500 |
Lease incentive obligation | (2,709) | |
Gain on sale of assets | (1,000) | |
Stock-based compensation expense | 44,702 | 37,902 |
Deferred tax benefit | (28,000) | (46,000) |
Bad debt expense | 8,900 | |
Changes in operating assets and liabilities, net of effect from acquisitions: | ||
Accounts receivable | 199,396 | 366,515 |
Short-term investments | (2,156) | (1,916) |
Prepaid expenses and other assets | 10,805 | (71,951) |
Accounts payable | 157,637 | 1,713 |
Accrued expenses and other current liabilities | 148,316 | 111,671 |
Customer deposits and deferred revenue | 635,028 | 617,352 |
Right of use assets and liabilities, net | 14,062 | |
Net cash provided by operating activities | 1,251,947 | 1,314,665 |
Investing activities: | ||
Proceeds from sale of assets | 1,000 | |
Purchases of property, equipment and software development costs | (196,373) | (152,949) |
Purchases of other long-term assets | (1,350) | |
Net cash used in investing activities | (195,373) | (154,299) |
Financing activities: | ||
Repayments of notes payable | (1,654) | (2,312) |
Repayments of finance lease obligations | (1,411) | (1,862) |
Stock repurchase under Stock Buyback Plan | (83,423) | (39,648) |
Net cash used in financing activities | (86,488) | (43,822) |
Net change in cash | 970,086 | 1,116,544 |
Cash at beginning of period | 1,482,391 | 2,705,778 |
Cash at end of period | $ 2,452,477 | $ 3,822,322 |
Consolidated Statement of Equit
Consolidated Statement of Equity (Unaudited) - USD ($) | Common Stock [Member] | Additional Paid-in Capital [Member] | Treasury Stock [Member] | Retained Earnings [Member] | Total |
Balance, beginning at Dec. 31, 2017 | $ 24,972 | $ 10,353,037 | $ (724,530) | $ 17,397 | $ 9,670,876 |
Balance, beginning, (in shares) at Dec. 31, 2017 | 24,652,895 | ||||
Stock-based compensation expense | 37,902 | 37,902 | |||
Repurchase of common shares under Stock Buyback Plan | (39,648) | (39,648) | |||
Repurchase of common shares under Stock Buyback Plan (in shares) | (15,680) | ||||
Net income attributable to Where Food Comes From, Inc. | 35,484 | 35,484 | |||
Balance, ending at Mar. 31, 2018 | $ 24,972 | 10,390,939 | (764,178) | 52,881 | 9,704,614 |
Balance, ending, shares at Mar. 31, 2018 | 24,637,215 | ||||
Balance, beginning at Dec. 31, 2018 | $ 25,473 | 11,031,264 | (1,109,061) | 818,133 | $ 10,765,809 |
Balance, beginning, (in shares) at Dec. 31, 2018 | 24,968,256 | 24,968,256 | |||
Stock-based compensation expense | 44,702 | $ 44,702 | |||
Repurchase of common shares under Stock Buyback Plan | (83,423) | (83,423) | |||
Repurchase of common shares under Stock Buyback Plan (in shares) | (46,758) | ||||
Net income attributable to Where Food Comes From, Inc. | (143,129) | (143,129) | |||
Balance, ending at Mar. 31, 2019 | $ 25,473 | $ 11,075,966 | $ (1,192,484) | $ 675,004 | $ 10,583,959 |
Balance, ending, shares at Mar. 31, 2019 | 24,921,498 | 24,921,498 |
The Company and Basis of Presen
The Company and Basis of Presentation | 3 Months Ended |
Mar. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
The Company and Basis of Presentation | Note 1 – The Company and Basis of Presentation Business Overview Where Food Comes From, Inc. is a Colorado corporation based in Castle Rock, Colorado (“WFCF”, the “Company,” “our,” “we,” or “us”). We are an independent, third-party food verification company conducting both on-site and desk audits to verify that claims being made about livestock, food, other high-value specialty crops and agricultural products are accurate. We care about food and other agricultural products, how it is grown and raised, the quality of what we eat, what farmers and ranchers do, and authentically telling that story to the consumer. Our team visits farms and ranches and looks at their plants, animals, and records, and compares the information we collect to specific standards or claims that farms and ranches want to make about how they are producing food. We strive to ensure that everyone involved in the food business - from growers and farmers to retailers and shoppers – can count on WFCF to provide authentic and transparent information about the food we eat and how, where, and by whom it is produced. We also provide sustainability programs, compliance management and farming information management solutions to drive sustainable value creation. We employ a software-as-a-service (“SaaS”) revenue model that bundles annual software licenses with ongoing software enhancements and upgrades and a wide range of professional services that generate incremental revenue specific to the food and agricultural industry. Finally, the Company’s Where Food Comes From Source Verified® retail and restaurant labeling program utilizes the verification of product attributes to connect consumers directly to the source of the food they purchase through product labeling and web-based information sharing and education. Most of our customers are located throughout the United States. Basis of Presentation Our unaudited consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”) and include the results of operations, financial position and cash flows of and its subsidiaries, International Certification Services, Inc. (“ICS”), Validus Verifications Services, LLC (“Validus”), Sterling Solutions (“Sterling”), SureHarvest Services, Inc. (“SureHarvest”), A Bee Organic, Sow Organic and JVF Consulting (collectively referred to as “we,” “us,” and “our” throughout this Form 10-Q) All significant intercompany transactions and amounts have been eliminated. The results of businesses acquired are included in the consolidated financial statements from the date of the acquisition. The consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) and should be read in conjunction with our audited financial statements and footnotes thereto for the year ended December 31, 2018, included in our Form 10-K filed on March 29, 2019. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been omitted pursuant to such rules and regulations. However, we believe that the disclosures are adequate to make the information presented not misleading. The financial statements reflect all adjustments (consisting primarily of normal recurring adjustments) that are, in the opinion of management, necessary for a fair presentation of our financial position and results of operations. The consolidated operating results for the quarter ended March 31, 2019 are not necessarily indicative of the results to be expected for any other interim period of any future year. Seasonality Our business is subject to seasonal fluctuations. Significant portions of our verification and certification service revenue are typically realized during late May through early October when the calf marketings and the growing seasons are at their peak. Because of the seasonality of the business and our industry, results for any quarter are not necessarily indicative of the results that may be achieved for any other quarter or for the full fiscal year. Recent Accounting Pronouncements The Financial Accounting Standards Board (FASB) Accounting Standards Codification is the sole source of authoritative GAAP other than SEC issued rules and regulations that apply only to SEC registrants. The FASB issues an Accounting Standards Update (ASU) to communicate changes to the codification. The Company considers the applicability and impact of all ASU’s. ASU’s not listed below were assessed and determined to be either not applicable or are not expected to have a material impact on the consolidated financial statements. Recently Adopted Accounting Pronouncements In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842), which requires lessees to recognize a right-of-use asset and a lease liability for all leases that are not short-term in nature. Accounting for finance leases is substantially unchanged. Topic 842 is effective for fiscal years beginning after December 15, 2018. We adopted the new lease standard as of January 1, 2019 using a modified retrospective transition. Under the effective date method, financial results reported in periods prior to 2019 are unchanged. We also elected the package of practical expedients, which among other things, does not require reassessment of lease classification. To assist in quantifying the impact on our consolidated financial statements and supplementing our existing disclosures, we designed internal controls over the adoption and implemented a software solution to manage and account for our leases. The adoption had a significant impact on our consolidated balance sheet due to the recognition of approximately $3.9 million of operating lease liabilities with corresponding right-of-use (“ROU”) assets for operating leases of $3.44 million as of January 1, 2019. The difference between the lease liability and the ROU asset primarily represents the existing deferred rent liabilities balances before adoption, resulting from historical straight-lining of operating leases. Balances for deferred rent and lease incentive obligation, which were historically presented separately, were cleared to zero and reclassed to our operating ROU assets. In June 2018, the FASB issued ASU 2018-07, Compensation-Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting, which simplifies the accounting for share-based payments made to nonemployees so the accounting for such payments is substantially the same as those made to employees. Under this ASU, share based awards to nonemployees will be measured at fair value on the grant date of the awards, entities will need to assess the probability of satisfying performance conditions if any are present, and awards will continue to be classified according to Accounting Standards Codification (“ASC”) 718 upon vesting which eliminates the need to reassess classification upon vesting, consistent with awards granted to employees. This ASU is effective for fiscal years beginning after December 15, 2018. The Company adopted the new guidance on January 1, 2019 and it did not have any effect on its consolidated financial statements. Recently Issued Accounting Pronouncements In June 2016 the FASB issued ASU 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, which adds a new Topic 326 to the Codification and removes the thresholds that companies apply to measure credit losses on financial instruments measured at amortized cost, such as loans, receivables, and held-to-maturity debt securities. Under current U.S. GAAP, companies generally recognize credit losses when it is probable that the loss has been incurred. The revised guidance will remove all recognition thresholds and will require companies to recognize an allowance for credit losses for the difference between the amortized cost basis of a financial instrument and the amount of amortized cost that the company expects to collect over the instrument’s contractual life. In April 2017, the FASB has issued ASU 2017-04, “Simplifying the Test for Goodwill Impairment,” which removes Step 2 from the goodwill impairment test. As a result, under the ASU, an entity should perform its annual, or interim, goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount and should recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 8420): Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement.” ASU 2018-13 modifies the requirements associated with the hierarchy associated with Level 1, Level 2 and Level 3 fair value measurements. The provisions of this ASU are effective for reporting periods after December 15, 2019; early adoption is permitted. We are currently evaluating the effect that this ASU will have on our consolidated financial statements. In August 2018 the FASB issued ASU 2018-15, Intangibles - Goodwill and Other - Internal Use Software - Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract, which amends the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract to align with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software. The update is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. Early adoption is permitted. We are in the process of evaluating the impact on our consolidated financial statements and the timing of adoption of this update. |
Business Acquisitions
Business Acquisitions | 3 Months Ended |
Mar. 31, 2019 | |
Business Combinations [Abstract] | |
Business Acquisitions | Note 2 – Business Acquisitions Sow Organic Acquisition On May 16, 2018, we acquired substantially all of the assets of Sow Organic for $450,000 in cash and 217,654 shares of common stock of WFCF valued at approximately $433,100. We believe the transaction further diversifies our offerings by adding complementary solutions and services available to new and existing customers. Sow Organic’s software as a service (SaaS) model allows organic certification bodies to automate and accelerate new customer onboarding by converting traditional paper-based processes to digital format, resulting in lower costs, improved workflow management and increased productivity. Sow Organic’s unique design allows certification bodies to digitize any certification scheme. Likewise, the software affords producers and handlers a more efficient way to become certified and to digitally manage their records on an ongoing basis, including completing annual certification requirements fully online. We intend to further develop the organic business opportunity and collaborate on a broader rollout of the solution to other certification markets where the tool is equally suited to improve efficiencies and reduce costs in the certification process. This transaction further strengthens our intellectual property portfolio, which we believe represents a distinct competitive advantage for the Company. We believe the impacts on proforma revenue and earnings are immaterial. The following table summarizes the final fair values assigned to the assets and liabilities acquired in addition to the excess of the purchase price over the net assets acquired at the acquisition date. Sow Organic, LLC May 16, 2018 Software acquired $ 156,000 Identifiable intangible assets: — Tradenames and trademarks 48,000 Non-compete agreements 84,000 Customer relationships 162,000 Goodwill 433,131 Total consideration $ 883,131 Excess attributable to goodwill reflects the excess over the identifiable intangible assets acquired based on the final allocation of the purchase price. Goodwill is primarily attributable to the operational and financial benefits expected to be realized from the acquisition, including cost saving synergies from operating efficiencies, future growth in bundling opportunities across divisions and brands, realized savings from a more sophisticated information technology infrastructure, and strategic advances from expansion of our intellectual property. JVF Consulting Acquisition On August 30, 2018, we acquired substantially all of the assets of JVF Consulting, LLC (“Seller” or “JVF”) for $500,000 in cash and 158,437 shares of common stock of WFCF valued at approximately $315,300. We believe the transaction adds value to certain of our existing software solutions which are based on intellectual property built and owned by the Seller. JVF is currently the largest technology provider to our SureHarvest division. With this acquisition, WFCF controls the intellectual property associated with its current Software as a Service (SaaS) offerings. Additionally, WFCF employed three of the Seller’s employees who enhance our ability to address new markets and services with our SaaS Solutions. We believe the impacts on proforma revenue and earnings are immaterial. The following table summarizes the final fair values assigned to the assets and liabilities acquired in addition to the excess of the purchase price over the net assets acquired at the acquisition date. JVF Consulting, LLC August 30, 2018 Software acquired $ 207,000 Identifiable intangible assets: Tradenames and trademarks 87,000 Non-compete agreements 37,000 Customer relationships 104,000 Goodwill 380,290 Total consideration $ 815,290 Excess attributable to goodwill reflects the excess over the identifiable intangible assets acquired based on the final allocation of the purchase price. Goodwill is primarily attributable to the operational and financial benefits expected to be realized from the acquisition, including cost saving synergies from operating efficiencies, future growth in bundling opportunities across divisions and brands, realized savings from a more sophisticated information technology infrastructure, and strategic advances from expansion of our intellectual property. |
Basic and Diluted Net Income pe
Basic and Diluted Net Income per Share | 3 Months Ended |
Mar. 31, 2019 | |
Earnings Per Share [Abstract] | |
Basic and Diluted Net Income per Share | Note 3 – Basic and Diluted Net Income per Share Basic net income per share was computed by dividing income available to common shareholders by the weighted average number of common shares outstanding during the period. Diluted net income per share is based on the assumption that all dilutive convertible shares and stock options were converted or exercised. Dilution is computed by applying the treasury stock method. Under this method, options and restricted stock awards are assumed to be exercised at the beginning of the period (or at the time of issuance, if later), and as if funds obtained thereby were used to purchase common stock at the average market price during the period. The following is a reconciliation of the share data used in the basic and diluted income per share computations: Three months ended March 31, 2019 2018 Basic: Weighted average shares outstanding 24,957,082 24,648,610 Diluted: Weighted average shares outstanding 24,957,082 24,648,610 Weighted average effects of dilutive securities — 196,392 Total 24,957,082 24,845,002 Antidilutive securities: 265,700 124,000 The effect of the inclusion of the antidilutive shares would have resulted in an increase in earnings per share. Accordingly, the weighted average shares outstanding have not been adjusted for antidilutive shares. |
Investment in Progressive Beef,
Investment in Progressive Beef, LLC | 3 Months Ended |
Mar. 31, 2019 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Investment in Progressive Beef, LLC | Note 4 – Investment in Progressive Beef, LLC On August 9, 2018, the Company purchased a ten percent membership interest in Progressive Beef, LLC (“Progressive Beef”) for an aggregate purchase price of approximately $991,000. The purchase price was payable in cash of $900,000 and 50,340 shares of common stock of WFCF valued at approximately $91,100 based upon the closing price of our stock on August 9, 2018, of $1.81 per share. Where Food Comes From is the primary certifier for Progressive Beef. For the first quarter ended March 31, 2019, the Company received dividend income from Progressive Beef of $30,000 representing a distribution of their earnings. The income is reflected within the “other (expense) income” section of the Company’s Consolidated Statement of Income for the quarter ended March 31, 2019. The investment is accounted for as a financial instrument under ASC 321 and the Company has elected to apply the practical expedient to value the investment at cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or similar investment of the same issuer. The Company completed a qualitative assessment and determined that there were no impairment indicators as of March 31, 2019. |
Intangible and Other Assets
Intangible and Other Assets | 3 Months Ended |
Mar. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible and Other Assets | Note 5 – Intangible and Other Assets The following table summarizes our intangible and other assets: March 31, December 31, 2019 2018 Intangible assets subject to amortization: Tradenames and trademarks $ 417,307 $ 417,307 Accreditations 85,395 85,395 Customer relationships 3,350,551 3,350,551 Patents 970,100 970,100 Non-compete agreements 121,000 121,000 4,944,353 4,944,353 Less accumulated amortization 1,731,679 1,577,558 3,212,674 3,366,795 Tradenames/trademarks (not subject to amortization) 465,000 465,000 3,677,674 3,831,795 Other assets 20,326 20,326 Intangible and other assets: $ 3,698,000 $ 3,852,121 |
Accrued Expenses and Other Curr
Accrued Expenses and Other Current Liabilities | 3 Months Ended |
Mar. 31, 2019 | |
Payables and Accruals [Abstract] | |
Accrued Expenses and Other Current Liabilities | Note 6 – Accrued Expenses and Other Current Liabilities The following table summarizes our accrued expenses and other current liabilities as of: March 31, December 31, 2019 2018 Income and sales taxes payable $ 25,800 $ 19,978 Payroll related accruals 224,572 147,798 Professional fees and other expenses 317,563 251,843 $ 567,935 $ 419,619 |
Notes Payable
Notes Payable | 3 Months Ended |
Mar. 31, 2019 | |
Notes Payable [Abstract] | |
Notes Payable | Note 7 – Notes Payable Notes Payable consist of the following: March 31, December 31, 2019 2018 Vehicle note $ 40,739 $ 42,393 Less current portion of notes payable and other long-term debt (10,299 ) (10,173 ) Notes payable and other long-term debt $ 30,440 $ 32,220 In September 2017, we entered into a note payable of $54,165 for the purchase of a vehicle. Interest and principal payments are due in equal monthly installments of $1,087 over five years beginning October 2017. This note bears an interest rate of 7.44% per annum and is fully secured by the vehicle. Unison Revolving Line of Credit The Company has a revolving line of credit (“LOC”) agreement which matures April 12, 2020. The LOC provides for $75,080 in working capital. The interest rate is at the Wall Street Journal prime rate plus 1.50% and is adjusted daily. Principal and interest are payable upon demand, but if demand is not made, then annual payments of accrued interest only are due, with the principal balance due on maturity |
Stock-Based Compensation
Stock-Based Compensation | 3 Months Ended |
Mar. 31, 2019 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock-Based Compensation | Note 8 – Stock-Based Compensation In addition to cash compensation, the Company may compensate certain service providers, including employees, directors, consultants, and other advisors, with equity-based compensation in the form of stock options and restricted stock awards. The Company recognizes all equity-based compensation as stock-based compensation expense based on the fair value of the compensation measured at the grant date. For stock options, fair value is calculated at the date of grant using the Black-Scholes-Merton option pricing model. For restricted stock awards, fair value is the closing stock price for the Company’s common stock on the grant date. The expense is recognized over the vesting period of the grant. For the periods presented, all stock-based compensation expense was classified as a component within selling, general and administrative expense in the Company’s consolidated statements of income. The amount of stock-based compensation expense is as follows: Three months ended March 31, 2019 2018 Stock options $ 38,744 $ 16,431 Restricted stock awards 5,958 21,471 Total $ 44,702 $ 37,902 During first quarter 2018, the Company awarded stock options to purchase 25,000 shares of the Company’s common stock at an exercise price of $2.55 per share to one of our business consultants. No awards were granted during the first quarter 2019. The Company estimated the fair value of stock options using the Black-Scholes-Merton option pricing model with the following assumptions: Three months ended March 31, 2019 2018 Number of options awarded to purchase common shares None 25,000 Risk-free interest rate N/A 2.60 % Expected volatility N/A 154.3 % Assumed dividend yield N/A N/A Expected life of options from the date of grant N/A 9.8 years The estimated unrecognized compensation cost from unvested awards which will be recognized ratably over the remaining vesting phase is as follows: Years ended December 31st Unvested stock options Unvested restricted stock awards Total unrecognized compensation expense 2019 (remaining nine months) 118,789 9,716 128,505 2020 110,072 4,251 114,323 2021 66,770 706 67,476 $ 295,631 $ 14,673 $ 310,304 Equity Incentive Plans Our 2016 Equity Incentive Plan (the “Equity Incentive Plan”) provides for the issuance of stock-based awards to employees, officers, directors and consultants. The Plan permits the granting of stock awards and stock options. The vesting of stock-based awards is generally subject to the passage of time and continued employment through the vesting period. Stock Option Activity Stock option activity under our Equity Incentive Plan is summarized as follows: Weighted avg. Weighted avg. Weighted avg. remaining Number of exercise price grant date fair contractual life Aggregate awards per share value per share (in years) intrinsic value Outstanding, December 31, 2018 434,451 $ 1.49 $ 1.47 6.91 $ 230,039 Granted — $ — $ — — Exercised — $ — $ — — Expired/Forfeited — $ — $ — — Outstanding, March 31, 2019 434,451 $ 1.49 $ 1.47 6.67 $ 226,039 Exercisable, March 31, 2019 235,710 $ 1.16 $ 1.16 4.52 $ 197,593 Unvested, March 31, 2019 198,741 $ 1.89 $ 1.83 9.21 $ 28,447 The aggregate intrinsic value represents the total pre-tax intrinsic value (the aggregate difference between the closing price of our common stock on March 31, 2019 and the exercise price for the in-the-money options) that would have been received by the option holders if all the in-the-money options had been exercised on March 31, 2019. Restricted Stock Activity Restricted stock activity under our Equity Incentive Plan is summarized as follows: Weighted avg. Number of grant date options fair value Non-vested restricted shares, December 31, 2018 30,000 $ 2.38 Granted — $ — Vested — $ — Forfeited — $ — Non-vested restricted shares, March 31, 2019 30,000 $ 2.38 |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Note 9 – Income Taxes Deferred tax assets and liabilities have been determined based upon the differences between the financial statement amounts and the tax bases of assets and liabilities as measured by enacted tax rates expected to be in effect when these differences are expected to reverse. In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The Company’s subsidiary, SureHarvest, is a California limited liability company (“LLC”). As an LLC, management believes SureHarvest is not subject to income taxes, and such taxes are the responsibility of the respective members. The Company is not providing for income taxes for the 40% interest owned by unrelated members of SureHarvest. The provision or benefit for income taxes is recorded at the end of each interim period based on the Company’s best estimate of its effective income tax rate expected to be applicable for the full fiscal year. For the three months ended March 31, 2019 we recorded an income tax benefit of $83,000 compared to income tax expense of $8,000 for the 2018 period. |
Revenue Recognition
Revenue Recognition | 3 Months Ended |
Mar. 31, 2019 | |
Revenue Recognition [Abstract] | |
Revenue Recognition | Note 10 - Revenue Recognition Verification and Certification Segment We offer a range of products and services to maintain identification, traceability, and verification systems. We conduct both on-site and desk audits to verify that claims being made about livestock, food, other high-value specialty crops and agricultural products are accurate. We generate revenue primarily from the sale of our verification solutions, consulting services and hardware sales. We sell our products and services directly to customers at various levels in the livestock and agricultural supply chains. Verification and certification service revenue primarily consists of fees charged for verification audits and other verification services that the Company performs for customers. A more detailed summary of our verification and certification services is included in the subsections below. Animal Verification and Certification Services Our animal verification and certification services contracts are generally structured in one of the following ways: (i) we commit to perform the required number of animal audits to verify a customer’s compliance with a standard or claim, or (ii) we commit to perform animal audit services at a fixed price by site or location type as requested by our customer during an annual period. These contract structures are discussed in more detail in the subsections below. Contract to Provide Required Number of Animal Audit Services For certain of our animal verification and certification services, we commit to perform the required number of location or site audits within our customer’s supply chain to verify customer’s compliance with a contractually-specified standard or claim. Each location or site audit is typically very short-term in nature, with a typical duration of one to two weeks. Upon completion of an audit, we provide the customer with an audit verification report for the specific site or location that was audited. Payment is made by customer upon completion of each site or location audit. We generally enter into revenue contracts with a one-year term. Our customers generally have the right to terminate the contract without prejudice with thirty days’ written notice. We have determined that, as a result of the termination provisions present in these contracts, the accounting contract term is a thirty-day period, with each thirty-day time increment representing a separate accounting contract under ASC 606. Furthermore, we have concluded that there is a single performance obligation that is a series comprised of each distinct location or site audit performed. Our customers are charged a standard daily rate for the provision of an audit based on the scale of site operations and geographical location. Consideration attributable to each audit within the series is variable, as the number of days required to complete each audit is not known until performance of that audit occurs. We have concluded that it is appropriate to allocate variable consideration (that is, the number of days required to complete an audit) to each audit within the series. This is because the consideration that we earn for each audit relates specifically to our efforts to transfer to our customer that discrete audit, and the resulting audit opinion or verification report, for that specified site or location, and this allocation is consistent with the allocation objective as defined in ASC 606. As a result, instances in which the Company evaluates and applies the constraint on variable consideration are immaterial. We further concluded that over-time recognition is appropriate because: (i) our performance of audits does not create an asset with an alternative use, as the audit and related verification report relates to facts and circumstances that are specific to each customer site or location (that is, there is a practical limitation on our ability to readily direct the asset to another customer) and (ii) we have an enforceable right to payment, inclusive of a reasonable profit, for performance completed to date. We utilize an input method to measure over-time progress of each audit within the series based on the number of audit days performed. We do, however, note that there are instances in which we only have an enforceable right to payment upon completion of an audit, and thus, over-time recognition is not permitted. For these contracts, revenue is recognized at the point in time at which an audit is completed. This does not result in a significant difference in the timing of revenue recognition (as compared to those audits that are recognized over time) due to the very short-term duration of an audit. Our customers may also have the option to purchase incremental review services (for example, an investigative audit or video review services) that are unrelated to the audit services to verify compliance with a specified standard or claim. The incremental review services are also typically very short-term in nature (that is, one to two weeks). We have concluded that these optional purchases do not reflect a material right under ASC 606 because the incremental review services are performed at standard pricing that would be charged to other similarly situated customers. Upon customer request for an incremental review service, we believe that our customer has made a discrete purchasing decision that should be treated as a separate accounting contract under ASC 606. We charge a fixed fee for the incremental review service, and thus, upon customer request, we are entitled to fixed consideration for that service under ASC 606. We concluded that over-time revenue recognition is appropriate for incremental review services because: (i) our performance of incremental review services does not create an asset with an alternative use because that review service, and the associated customer deliverable, relates to facts and circumstances that are specific to each customer site or location (that is, there is a practical limitation on our ability to readily direct the asset to another customer) and (ii) we have an enforceable right to payment, inclusive of a reasonable profit, for performance completed to date on incremental review services. We utilize a time-based input method to measure progress toward complete satisfaction of an incremental review service, which is based on the number of hours performed on the incremental review service relative to the total number of hours required to complete that review service. As previously mentioned, our incremental review services are typically completed within one to two weeks of a customer request. Contract to Provide Animal Audit Services at Customer Request Other animal verification and certification services contracts are structured such that we commit to perform audit services at a fixed price by site or location type as requested by our customer during an annual period. Performance of an audit typically occurs within a one to two-week period. We invoice our customer upon completion of an audit, and payment is due from customer within thirty days or less of receipt of invoice. Under this contract structure, the customer is, in effect, provided a pricing list for animal audit services, and pricing is effective over a one-year period. We have concluded that enforceable rights and obligations do not arise until a customer actually engages us to perform an audit service documented in the pricing list; therefore, each customer request represents a purchasing decision that is a separate accounting contract under ASC 606. We note that the termination provisions specified in our pricing lists vary. In certain instances, a customer may only have the right to terminate in the event of non-performance. Alternatively, in other contracts, a customer may have the right to terminate without prejudice at any time or with thirty days’ written notice. However, regardless of the termination provision specified, we have concluded that the accounting contract term is equal to the duration of the requested audit service (that is, the termination provisions generally do not affect the accounting contract term for each requested audit service). Upon a customer’s request for an audit service, consideration is fixed, as we charge the customer a fixed fee by audit type over the annual period per the pricing list. We concluded that over-time revenue recognition is appropriate for a requested audit service because: (i) our performance of the requested audit service does not create an asset with an alternative use as that audit, and the associated audit report, relate to facts and circumstances that are specific to each customer site or location (that is, there is a practical limitation on our ability to readily direct the asset to another customer) and (ii) we have an enforceable right to payment, inclusive of a reasonable profit, for performance completed to date on a requested audit. A time-based input method is utilized to measure progress toward complete satisfaction of an audit based on the number of hours performed on that audit relative to the total number of hours expected to be required to complete the audit. As previously mentioned, our audit services are typically completed within one to two weeks of a customer request. Other Considerations for Animal Certification and Verification Services In connection with the provision of on-site audits related to animal certification and verification services, reimbursable expenses are incurred and billed to customers, and such amounts are recognized on a gross basis as both revenue and cost of revenue. Any amounts collected on behalf of a third-party and remitted in full to that third-party are excluded from the transaction price and, thus, revenue. Crop and Other Processed Product Verification and Certification Services Third-party crop and other processed product audits are generally structured such that we commit to perform an independent audit to verify that food producers and/or farmers comply with certain standards. We generally provide verification services related to organic, Non-GMO and gluten-free standards. Depending on the crop or product type, verification audit activities may take two months to one year to complete. During this assessment period, various integrated audit activities and/or input reviews are performed in accordance with the regulations specified by the relevant standard. The fee structure is such that customers pay an annual assessment fee for a crop or other processed product to verify compliance with the specified standard. This fee is payable upfront on a nonrefundable basis. Our customers can typically terminate a crop or other processed product audit at any time without prejudice. However, given the nonrefundable upfront payment structure for the annual assessment service, we have concluded that the contract term is one year. We record the upfront payment made by the customer for the annual assessment service as deferred revenue. The audit activities and input reviews required in the provision of an annual assessment are not distinct under ASC 606, and consequently, we account for an annual assessment as a single integrated performance obligation. For certain of our third-party crop and other processed product audits, the annual assessment fee is fixed for the annual period. In other scenarios, the annual assessment fee may be variable due to increased review activities required for incremental inputs to a crop or processed product identified through the assessment process. At the time that an incremental input is identified, which generally occurs in the early stages of an annual assessment, the incremental consideration for the provision of review services related to that incremental input also becomes known. We allocate the transaction price derived from the annual assessment fee to the single integrated performance obligation for that annual assessment. Revenue related to the annual assessment is recognized over time in accordance with ASC 606. This is because the annual assessment service does not create an asset with an alternative use, as it relates to facts and circumstances that are specific to a customer’s crop or processed product. Further, we have an enforceable right to payment for performance completed to date on the annual assessment due to the nonrefundable upfront payment made by customer. We utilize an input method to measure progress toward satisfaction of the annual assessment based on the percentage of activities/phases or input reviews completed under the annual assessment. As it relates to the upfront payment for the annual assessment, we have utilized the practical expedient that exempts us from adjusting consideration for the effects of a significant financing component when we expect that the period between customer payment and the provision of the related service is one year or less. In certain contracts, an independent third-party inspection may be required for a site or location in our customer’s supply chain in accordance with the regulations for a specified standard. An inspection is performed by an independent third-party inspector, and the customer is charged an hourly rate for these inspection services. Under this scenario, a separate accounting contract arises upon initiation and performance of an inspection, and we typically invoice our customer for the inspection upon completion of the inspection service. Given that the customer has the ability to terminate at any time without prejudice, we have concluded that the contract term for each inspection ends as control of an inspection service transfers. Inspections are generally short-term in nature with a term ranging from a few days to two weeks. We have further determined that inspections are distinct from an annual assessment. Consideration attributable to an inspection is variable, as the inspector is only able to provide a high-level estimate of the cost of the inspection based on the inspector’s hourly rate until the inspector is at the relevant producer/supplier site to determine the time and level of effort required to complete the inspection. Given the very short-term nature of an inspection, variability related to an inspection generally resolves itself within a reporting period. However, we are typically required by certain regulations to provide an inspection cost estimate to our customer, and, if required, we utilize that estimate as our estimate of variable consideration. The cost estimate is generally derived from the cost to perform the prior-year inspection for that specific customer site or location or, when required, the historical cost to provide an inspection for a comparable site or location. In our experience, the historical cost of inspections has been predictive of the future cost of an inspection. Other Considerations for Crop and Other Processed Product Verification Services Reimbursable expenses incurred in the provision of an annual assessment or required inspection are billed to our customers, and such amounts are recognized on a gross basis as both revenue and cost of revenue. In addition, any amounts collected on behalf of a third-party and remitted in full to that third-party are excluded from the transaction price and, thus, revenue. Product Sales Product sales are primarily generated from the sale of cattle identification ear tags. Each customer purchase request represents a purchasing decision made by customer. As such, enforceable rights and obligations (and, thus, a separate accounting contract under ASC 606) arise at the time a customer submits its purchase request to us. At the time of request, we are entitled to fixed consideration, as the sales quantity and related price of the product is known. All of our customers are charged the same fixed price per tag. Revenue for product sales is recognized upon delivery of the goods to customer, at which point title, custody and risk of loss transfer to the customer. We typically deliver product to the customer within a few days of customer’s sales request. At the time of delivery, we invoice our customer for the related product sales and record invoiced amounts to accounts receivable. Payment is typically due by customer upon receipt of invoice. In relation to our product sales, the sales taxes collected from customers and remitted to government authorities are excluded from revenue. Additionally, we do not typically provide right of return or warranty on product sales. Software Sales and Related Consulting Segment We predominately offer software products via a SaaS model, which is an annual subscription-based model. Support services are generally included in the subscription. We also provide web-hosting services on an annual basis to all of our customers in conjunction with their software subscription. Customers have the ability to terminate without prejudice upon thirty days’ written notice; however, the subscription fee, inclusive of maintenance and support services, and the web-hosting fee are paid upfront by the customer on a nonrefundable basis. Consequently, we have concluded that the contract term for the annual software subscription and web-hosting services is one year. We have determined that a software license subscription and the related hosting service should be accounted for as a service transaction, as we provide the functionality of our software through the hosting arrangement. The SaaS arrangement provides customers with unlimited access to our software and, thus, is accounted for as a series of distinct daily service periods that provide substantially the same service (that is, continuous access to the hosted software) each day during the annual contract term. Further, the provision of basic technical support services also represents a stand-ready obligation that is a series of distinct daily service periods that provide substantially the same service (that is, access to our technical support infrastructure) during the annual contract term. Because the basic technical support services and SaaS each represent performance obligations that are a series of distinct daily service periods, we have elected to combine these performance obligations. We are entitled to fixed consideration for the software license subscription, inclusive of support services, and the related hosting service. The software license subscription and hosting fees in our contracts represent the standalone selling price for that related service. This is because the fees charged for the software license subscription and hosting service represent the software license subscription and hosting service fees that are charged to other customers with a similar level of data loaded into the software (regardless of whether that customer contracts for professional services). Accordingly, the software license subscription and hosting fees are allocated to the combined SaaS performance obligation. We recognize revenue related to the SaaS arrangement over time because a customer simultaneously receives and consumes the benefit from the provision of access to the hosted software over the annual subscription period. Accordingly, we utilize a time-based output measure of progress that results in a straight-line attribution of revenue. That is, revenue related to the combined SaaS obligation should be recognized daily on a straight-line basis over the one-year subscription term, as this reflects the direct measurement of value to a customer of the provision of access to the software via hosting each day. As it relates to the upfront payment for the software subscription and hosting service, we have utilized the practical expedient that exempts us from adjusting consideration for the effects of a significant financing component when we expect that the period between customer payment and the provision of the related service is one year or less. In addition, we record the upfront payment made by customer for the annual assessment service as deferred revenue. In some of our SaaS contracts, we also provide software-related consulting services to our customers during an annual software subscription period. Consulting services fees are derived from a standard rate card by employee level, and we invoice for consulting services monthly on a time-incurred basis. Due to the termination provisions present in our SaaS contracts, our customers have an in-substance renewal decision each month for further consulting services (that is, via their decision not to terminate the contract each month). Accordingly, the contract term for consulting services is on a month-to-month basis within the annual subscription period. We have concluded that consulting services are distinct from the SaaS arrangement. To the extent that consulting services result in a software enhancement or new functionality, we have determined that those consulting services are still distinct because added features typically provide new, discrete capabilities with independent value to a customer and a customer accesses the SaaS in a single-tenant architecture. Further, additional features and functionality are often made available to a customer substantially after the “go-live” date of the software (via the hosting service). As a result, our software-related consulting services represent distinct performance obligations. We recognize revenue over time in accordance with ASC 606. This is because our performance does not create an asset with an alternative use, as consulting services, and, if applicable, any related software enhancements, are highly tailored to the farming industry specific to the given customer, and we have an enforceable right to payment, inclusive of profit, for performance completed to date. As a result, for our consulting services, we have elected to utilize the practical expedient that allows us to recognize revenue in the amount to which we have a right to invoice, as we believe that we have a right to consideration from a customer in an amount that corresponds directly with the value to the customer of our performance completed to date for the provision of consulting services. Principal versus Agent Considerations Under certain of our verification and certification service contracts, a third-party inspector may be required to perform an independent inspection of a site or location within our customer’s supply chain in accordance with regulations of a certain standard or claim. In this scenario, we have concluded that we are the principal in the provision of inspection services to our customer, as we control the inspection service, and the related inspection report, before it is transferred to our customer. In accordance with this conclusion, we present revenue related to inspections on a gross basis, with customer payment for an inspection presented as revenue and the inspection cost paid to the third-party inspector presented as an expense. In addition, we utilize a third-party to provide web-hosting services in the provision of our SaaS arrangements. In this scenario, we are primarily responsible for fulfilling the promise to provide web-hosting services to the customer, and we establish the fee that the customer is charged for the web-hosting services. Consequently, we have also concluded that we are the principal in the provision of web-hosting services under our SaaS arrangements. As such, we present revenue on a gross basis, with consideration received from our customer for the web-hosting service recorded as revenue and the cost paid to the third-party to provide those web-hosting services recorded as an expense. Disaggregation of Revenue We have identified four material revenue categories in our business: (i) verification and certification service revenue, (ii) product sales, (iii) software license, maintenance and support services revenue and (iv) software-related consulting service revenue. Revenue attributable to each of our identified revenue categories is disaggregated in the table below. Three months ended March 31, 2019 Three months ended March 31, 2018 Verification Software Eliminations Consolidated Verification Software Sales and Related Consulting Segment Eliminations Consolidated Verification and certification service revenue $ 2,811,694 $ — $ — $ 2,811,694 $ 2,796,194 $ — $ — $ 2,796,194 Product sales 641,058 — — 641,058 353,894 — — 353,894 Software license, maintenance and support services revenue — 343,566 (48,537 ) 295,029 — 287,444 — 287,444 Software-related consulting service revenue — 221,223 (14,464 ) 206,759 — 183,270 — 183,270 Total revenues $ 3,452,752 $ 564,789 $ (63,001 ) $ 3,954,540 $ 3,150,088 $ 470,714 $ — $ 3,620,802 Transaction Price Allocated to Remaining Performance Obligations We generally enter into revenue contracts with a one-year term. In certain instances, we have concluded that our contract term is less than one year because: (i) the termination provisions present in the contract impact the contract term under ASC 606 or (ii) a contract under ASC 606 arises at the time our customer requests the provision of a good or service that is delivered within or over a few days to a couple of weeks. As a result of our short-term contract structures, we have utilized the practical expedient in ASC 606-10-50-14 that exempts us from disclosure of the transaction price allocated to remaining performance obligations if the performance obligation is part of a contract that has an original expected duration of one year or less. Contract Balances Under our animal verification and certification services contracts, we invoice customers once the performance obligation for the provision of a site or location audit has been satisfied, at which point payment is unconditional. In addition, any product sales are invoiced upon delivery to the customer, at which point payment is also unconditional. Accordingly, our animal verification and certification services contracts do not give rise to a contract asset under ASC 606; rather, invoiced amounts reflect accounts receivable. Under our crop and other processed product verification and certification services, a nonrefundable payment for an annual assessment of compliance with a standard is typically made by our customers upfront upon contract execution. That is, payment is made in advance of the provision of annual assessment services. Accordingly, we recognize deferred revenue upon receipt of the upfront payment from our customers for crop and other processed product audit assessment services. Revenue is subsequently recognized, and the related deferred revenue is reduced, over the one-year period during which assessment services are provided to the customer using the over-time measure of progress selected in accordance with ASC 606. To the extent that an inspection is required during the annual assessment period, we invoice customers once the performance obligation for the inspection has been satisfied, at which point payment is unconditional. As such, inspection services give rise to accounts receivable. Our software subscriptions, web-hosting, and support services are paid by our customers upfront on a nonrefundable basis. That is, payment is made in advance of the provision of these services to our customers. As a result, we recognize deferred revenue upon receipt of the upfront payment from our customers for software subscriptions, web-hosting and maintenance and support services. Revenue is subsequently recognized, and the related deferred revenue is reduced, on a straight-line basis during the annual contract term that these stand-ready services are provided to customer. Software-related consulting services are invoiced monthly on a time-incurred basis, at which point we have an enforceable right to payment for those services. Because payment is unconditional upon invoicing, our software-related consulting services are reflected as accounts receivable. As of March 31, 2019, and December 31, 2018, accounts receivable from contracts with customers, net of allowance for doubtful accounts, were approximately $2,005,800 and $2,205,200, respectively. As of March 31, 2019, and December 31, 2018, deposits and deferred revenue from contracts with customers were approximately $1,362,900 and $727,900, respectively. The balance of the contract liabilities at March 31, 2019 and December 31, 2018 are expected to be recognized as revenue within one year or less of the invoice date. Costs to fulfill a contract Prior to August 2018, we incurred a fixed cost, payable to JVF Consulting, LLC, a third-party provider, to perform set-up activities for new (or first-year) customers that contract for our software subscription and hosting services. As previously discussed in Note 2, on August 30, 2018, we acquired JVF Consulting, which included three key employees. We concluded that those set-up activities performed by JVF did not transfer a good or service as defined in ASC 606 to our customers. We capitalize fixed set-up costs as an asset on the following basis: (i) the fixed set-up costs incurred relate specifically to a customer contract for our software subscription and hosting service, (ii) the fixed set-up costs incurred are expected to be recovered via provision of the software subscription and hosting service to that customer and (iii) the set-up costs generate or enhance resources of the Company by permitting us to provide software subscription and hosting services to our customer, which, in turn, generates revenues. Capitalized costs related to those set-up activities are amortized on a straight-line basis over the one-year license subscription and hosting period. The ending balance at March 31, 2019 and December 31, 2018 of capitalized assets attributable to the set-up costs incurred to fulfill software subscription and hosting contracts was not material. No set-up costs related to our software subscription and hosting services were incurred for the first quarter ended March 31, 2019 or the year-ended December 31, 2018. In addition, amortization of capitalized set-up costs for the first quarter ended March 31, 2019 or the year ended December 31, 2018 was not material, and no impairment loss was incurred related to capitalized set-up costs. Commissions and other costs to obtain a contract are expensed as incurred as our contracts are typically completed in one year or less, and where applicable, we generally would incur these costs whether or not we ultimately obtain the contract. |
Leases
Leases | 3 Months Ended |
Mar. 31, 2019 | |
Lessee Disclosure [Abstract] | |
Leases | Note 11 – Leases We adopted ASU 2016-02: Leases (Topic 842) as of January 1, 2019. We determine if an arrangement is a lease at inception. Operating leases are included in operating lease right-of-use (ROU) assets, current operating lease liabilities and noncurrent operating lease liabilities in our consolidated balance sheet. Finance leases are included in property and equipment, current finance lease obligations and long-term finance lease obligations in our consolidated balance sheet. ROU assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. ROU assets and liabilities are recognized at the lease commencement date based on the estimated present value of lease payments over the lease term. As the discount rates in the Company's lease are not implicit, the Company estimated the incremental borrowing rate based on the rate of interest the Company would have to pay to borrow a similar amount on a collateralized basis over a similar term. Our lease term includes options to extend the lease when it is reasonably certain that we will exercise that option. Leases with a term of 12 months or less are not recorded on the balance sheet. Our lease agreements do not contain any residual value guarantees. We have operating and finance leases for corporate offices, other regional offices, and certain equipment. Our leases have remaining lease terms of 1 year to 15 years, some of which include multiple options to extend the leases for up to 5 years each. The components of lease expense were as follows: Three months ended March 31, 2019 Operating lease cost $ 119,697 Finance lease cost Amortization of ROU assets $ 2,267 Interest on finance lease obligations $ 2,006 Total net lease cost $ 123,970 Included in the table above, is $92,200 of operating lease cost for our corporate headquarters. Rent expense for the quarter ended March 31, 2018 was $126,200. Supplemental balance sheet information related to leases was as follows: March 31, 2019 Operating leases: Related Party Other Total Operating lease ROU assets $ 3,059,939 $ 299,871 $ 3,359,810 Current operating lease liabilities $ 144,078 $ 66,769 $ 210,847 Noncurrent operating lease liabilities 3,379,897 267,527 3,647,424 Total operating lease liabilities $ 3,523,975 $ 334,296 $ 3,858,271 Finance leases: March 31, 2019 Property and equipment, at cost $ 47,367 Accumulated amortization (15,794 ) Property and equipment, net $ 31,573 Current obligations of finance leases $ 7,303 Finance leases, net of current obligations 31,968 Total finance lease liabilities $ 39,271 Weighted average remaining lease term (in years): Operating leases 11.7 Finance leases 3.6 Weighted average discount rate: Operating leases 5.8 % Finance leases 20.9 % Supplemental cash flow and other information related to leases was as follows: Three months ended March 31, 2019 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 100,110 Operating cash flows from finance leases $ 2,006 Financing cash flows from finance leases $ 1,411 Maturities of lease liabilities were as follows: Years Ending December 31st, Operating Leases Finance Leases 2019 (remaining nine months) $ 321,306 $ 10,861 2020 422,164 15,705 2021 434,829 14,143 2022 447,874 10,984 2023 461,310 5,609 Thereafter 3,308,155 — Total lease payments 5,395,638 57,302 Less amount representing interest (1,537,637 ) (18,031 ) Total lease obligations 3,858,271 39,271 Less current portion (210,847 ) (7,303 ) Long-term lease obligations $ 3,647,424 $ 31,968 As previously reported in the 2018 Form 10-K under ASC Topic 840, future minimum lease payments under the Company’s operating lease agreements that had initial or remaining non-cancelable lease terms in excess of one year as of December 31, 2018 were as follows: Years ended December 31st Total 2019 $ 420,370 2020 421,590 2021 432,079 2022 447,264 2023 460,682 Thereafter 3,327,705 Total lease commitments $ 5,509,690 |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 12 – Commitments and Contingencies Legal proceedings From time to time, we may become involved in various legal actions, administrative proceedings and claims in the ordinary course of business. We generally record losses for claims in excess of the limits of purchased insurance in earnings at the time and to the extent they are probable and estimable. We are not aware of any legal actions currently pending against us. Contingently Redeemable Non-Controlling Interest On December 28, 2016, we entered into an Asset Purchase Agreement (the “SureHarvest Purchase Agreement”), by and among the Company, SureHarvest Services LLC (the “Buyer” or “SureHarvest”); and SureHarvest, Inc., a California corporation (the “Seller”). We purchased the business assets of the Seller for total consideration of approximately $2.66 million, comprised of approximately $1,122,000 in cash and 850,852 shares of common stock of WFCF valued at approximately $1,534,900. Additionally, we issued the Seller a 40% membership interest in SureHarvest, with the Company holding a 60% interest. Following the thirty-six-month anniversary of the effective date of the SureHarvest Purchase Agreement, the Company shall have the option, but not the obligation, to purchase all the units (the 40% interest) of SureHarvest held by the Seller, and the Seller shall have the option, but not the obligation, to require the Company to purchase all the units of SureHarvest held by the Seller. The purchase price for the units shall be equal to the amount the selling holders of the units would be entitled to receive upon a liquidation of SureHarvest assuming all of the assets of SureHarvest are sold for a purchase price equal to the product of eight and half times trailing twelve-month earnings before income taxes, depreciation and amortization, as defined, subject to an $8 million ceiling. Because SureHarvest, Inc. at its option, can require the Company to purchase its 40% interest in SureHarvest, the SureHarvest non-controlling interest meets the definition of a contingently redeemable non-controlling interest. Redeemable non-controlling interests are presented at the greater of their carrying amount or redemption value at the end of each reporting period and are shown as a separate caption between liabilities and equity (mezzanine section) in the accompanying consolidated balance sheet. The table below reflects the activity of the contingently redeemable non-controlling interest: Balance, December 31, 2018 $ 1,449,007 Net loss attributable to non-controlling interest in SureHarvest for the year to date period ended March 31, 2019 (43,835 ) Balance, March 31, 2019 $ 1,405,172 |
Segments
Segments | 3 Months Ended |
Mar. 31, 2019 | |
Segment Reporting [Abstract] | |
Segments | Note 13 – Segments With each acquisition, we assess the need to disclose discrete information related to our operating segments. Because of the similarities of certain of our acquisitions that provide certification and verification services, we aggregate operations into one verification and certification reportable segment. The operating segments included in the aggregated verification and certification segment include IMI Global, ICS, and Validus. The factors considered in determining this aggregated reporting segment include the economic similarity of the businesses, the nature of services provided, production processes, types of customers and distribution methods. The Company also determined that it has a software sales and related consulting reportable segment. SureHarvest, which includes Sow Organic and JVF Consulting, is the sole operating segment. This segment includes software license, maintenance, support and software-related consulting service revenues. The Company’s chief operating decision maker (the Company’s CEO) allocates resources and assesses the performance of its operating segments. Segment management makes decisions, measures performance, and manages the business utilizing internal reporting operating segment information. Performance of operating segments are based on net sales, gross profit, selling, general and administrative expenses and most importantly, operating income. The Company eliminates intercompany transfers between segments for management reporting purposes. The following table shows information for reportable operating segments: Three months ended March 31, 2019 Three months ended March 31, 2018 Verification and Certification Segment Software Sales and Related Consulting Segment Eliminations and Other Consolidated Totals Verification and Certification Segment Software Sales and Related Consulting Segment Eliminations and Other Consolidated Totals Assets: Intangible and other assets, net $ 1,424,275 $ 2,273,725 $ — $ 3,698,000 $ 1,591,786 $ 2,166,298 $ — $ 3,758,084 Goodwill 1,133,122 2,010,612 — 3,143,734 1,279,762 1,372,488 — 2,652,250 Total assets 13,031,344 5,518,447 — 18,549,791 9,830,255 4,253,835 — 14,084,090 Revenues: Verification and certification service revenue $ 2,811,694 $ — $ — $ 2,811,694 $ 2,796,194 $ — $ — $ 2,796,194 Product sales 641,058 — — 641,058 353,894 — — 353,894 Software license, maintenance and support services revenue — 343,566 (48,537 ) 295,029 — 287,444 — 287,444 Software-related consulting service revenue — 221,223 (14,464 ) 206,759 — 183,270 — 183,270 Total revenues $ 3,452,752 $ 564,789 $ (63,001 ) $ 3,954,540 $ 3,150,088 $ 470,714 $ — $ 3,620,802 Costs of revenues: Costs of verification and certification services 1,594,763 — (32,673 ) 1,562,090 1,450,609 — — 1,450,609 Costs of products 443,185 — — 443,185 225,975 — — 225,975 Costs of software license, maintenance and support services — 154,003 — 154,003 — 137,434 — 137,434 Costs of software-related consulting services — 129,536 — 129,536 — 75,461 — 75,461 Total costs of revenues 2,037,948 283,539 (32,673 ) 2,288,814 1,676,584 212,895 — 1,889,479 Gross profit 1,414,804 281,250 (30,328 ) 1,665,726 1,473,504 257,819 — 1,731,323 Depreciation & amortization 81,938 178,183 — 260,121 77,997 138,046 — 216,043 Other operating expenses 1,510,592 225,954 (30,328 ) 1,706,218 1,332,397 156,034 — 1,488,431 Segment operating (loss)/income $ (177,726 ) $ (122,887 ) $ — $ (300,613 ) $ 63,110 $ (36,261 ) $ — $ 26,849 Other items to reconcile segment operating income (loss) to net income attributable to WFCF: Other expense (income) — — (30,649 ) (30,649 ) — — (1,839 ) (1,839 ) Income tax (benefit)/expense — — (83,000 ) (83,000 ) — — 8,000 8,000 Net loss attributable to non-controlling interest — 43,835 — 43,835 — — 14,796 14,796 Net (loss)/income attributable to WFCF $ (177,726 ) $ (79,052 ) $ 113,649 $ (143,129 ) $ 63,110 $ (36,261 ) $ 8,635 $ 35,484 |
Supplemental Cash Flow Informat
Supplemental Cash Flow Information | 3 Months Ended |
Mar. 31, 2019 | |
Supplemental Cash Flow Information [Abstract] | |
Supplemental Cash Flow Information | Note 14 – Supplemental Cash Flow Information Three months ended March 31, 2019 2018 Cash paid during the year: Interest expense $ 3,047 $ 1,079 Income taxes $ — $ 7,283 |
Business Acquisitions (Tables)
Business Acquisitions (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Business Combinations [Abstract] | |
Schedule of acquisitions | The following table summarizes the final fair values assigned to the assets and liabilities acquired in addition to the excess of the purchase price over the net assets acquired at the acquisition date. Sow Organic, LLC May 16, 2018 Software acquired $ 156,000 Identifiable intangible assets: — Tradenames and trademarks 48,000 Non-compete agreements 84,000 Customer relationships 162,000 Goodwill 433,131 Total consideration $ 883,131 The following table summarizes the final fair values assigned to the assets and liabilities acquired in addition to the excess of the purchase price over the net assets acquired at the acquisition date. JVF Consulting, LLC August 30, 2018 Software acquired $ 207,000 Identifiable intangible assets: Tradenames and trademarks 87,000 Non-compete agreements 37,000 Customer relationships 104,000 Goodwill 380,290 Total consideration $ 815,290 |
Basic and Diluted Net Income _2
Basic and Diluted Net Income per Share (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Earnings Per Share [Abstract] | |
Schedule of reconciliation of basic and diluted income per share computations | The following is a reconciliation of the share data used in the basic and diluted income per share computations: Three months ended March 31, 2019 2018 Basic: Weighted average shares outstanding 24,957,082 24,648,610 Diluted: Weighted average shares outstanding 24,957,082 24,648,610 Weighted average effects of dilutive securities — 196,392 Total 24,957,082 24,845,002 Antidilutive securities: 265,700 124,000 |
Intangible and Other Assets (Ta
Intangible and Other Assets (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of intangible and other assets | The following table summarizes our intangible and other assets: March 31, December 31, 2019 2018 Intangible assets subject to amortization: Tradenames and trademarks $ 417,307 $ 417,307 Accreditations 85,395 85,395 Customer relationships 3,350,551 3,350,551 Patents 970,100 970,100 Non-compete agreements 121,000 121,000 4,944,353 4,944,353 Less accumulated amortization 1,731,679 1,577,558 3,212,674 3,366,795 Tradenames/trademarks (not subject to amortization) 465,000 465,000 3,677,674 3,831,795 Other assets 20,326 20,326 Intangible and other assets: $ 3,698,000 $ 3,852,121 |
Accrued Expenses and Other Cu_2
Accrued Expenses and Other Current Liabilities (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Payables and Accruals [Abstract] | |
Schedule of accrued expenses and other current liabilities | The following table summarizes our accrued expenses and other current liabilities as of: March 31, December 31, 2019 2018 Income and sales taxes payable $ 25,800 $ 19,978 Payroll related accruals 224,572 147,798 Professional fees and other expenses 317,563 251,843 $ 567,935 $ 419,619 |
Notes Payable (Tables)
Notes Payable (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Notes Payable Tables Abstract | |
Schedule of notes payable | Notes Payable consist of the following: March 31, December 31, 2019 2018 Vehicle note $ 40,739 $ 42,393 Less current portion of notes payable and other long-term debt (10,299 ) (10,173 ) Notes payable and other long-term debt $ 30,440 $ 32,220 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Schedule of stock-based compensation expense | The amount of stock-based compensation expense is as follows: Three months ended March 31, 2019 2018 Stock options $ 38,744 $ 16,431 Restricted stock awards 5,958 21,471 Total $ 44,702 $ 37,902 |
Schedule of unrecognized compensation cost from unvested awards | The estimated unrecognized compensation cost from unvested awards which will be recognized ratably over the remaining vesting phase is as follows: Years ended December 31st Unvested stock options Unvested restricted stock awards Total unrecognized compensation expense 2019 (remaining nine months) 118,789 9,716 128,505 2020 110,072 4,251 114,323 2021 66,770 706 67,476 $ 295,631 $ 14,673 $ 310,304 |
Schedule of estimated fair value of stock options | The Company estimated the fair value of stock options using the Black-Scholes-Merton option pricing model with the following assumptions: Three months ended March 31, 2019 2018 Number of options awarded to purchase common shares None 25,000 Risk-free interest rate N/A 2.60 % Expected volatility N/A 154.3 % Assumed dividend yield N/A N/A Expected life of options from the date of grant N/A 9.8 years |
Schedule of stock option activity under Equity Incentive Plan | Stock option activity under our Equity Incentive Plan is summarized as follows: Weighted avg. Weighted avg. Weighted avg. remaining Number of exercise price grant date fair contractual life Aggregate awards per share value per share (in years) intrinsic value Outstanding, December 31, 2018 434,451 $ 1.49 $ 1.47 6.91 $ 230,039 Granted — $ — $ — — Exercised — $ — $ — — Expired/Forfeited — $ — $ — — Outstanding, March 31, 2019 434,451 $ 1.49 $ 1.47 6.67 $ 226,039 Exercisable, March 31, 2019 235,710 $ 1.16 $ 1.16 4.52 $ 197,593 Unvested, March 31, 2019 198,741 $ 1.89 $ 1.83 9.21 $ 28,447 |
Schedule of restricted stock activity under Equity Incentive Plan | Restricted stock activity under our Equity Incentive Plan is summarized as follows: Weighted avg. Number of grant date options fair value Non-vested restricted shares, December 31, 2018 30,000 $ 2.38 Granted — $ — Vested — $ — Forfeited — $ — Non-vested restricted shares, March 31, 2019 30,000 $ 2.38 |
Revenue Recognition (Tables)
Revenue Recognition (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Revenue Recognition Tables Abstract | |
Schedule of revenues disaggregated by revenue discipline | Revenue attributable to each of our identified revenue categories is disaggregated in the table below. Three months ended March 31, 2019 Three months ended March 31, 2018 Verification Software Eliminations Consolidated Verification Software Sales and Related Consulting Segment Eliminations Consolidated Verification and certification service revenue $ 2,811,694 $ — $ — $ 2,811,694 $ 2,796,194 $ — $ — $ 2,796,194 Product sales 641,058 — — 641,058 353,894 — — 353,894 Software license, maintenance and support services revenue — 343,566 (48,537 ) 295,029 — 287,444 — 287,444 Software-related consulting service revenue — 221,223 (14,464 ) 206,759 — 183,270 — 183,270 Total revenues $ 3,452,752 $ 564,789 $ (63,001 ) $ 3,954,540 $ 3,150,088 $ 470,714 $ — $ 3,620,802 |
Leases (Tables)
Leases (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Lessee Disclosure [Abstract] | |
Schedule of lease expense | The components of lease expense were as follows: Three months ended March 31, 2019 Operating lease cost $ 119,697 Finance lease cost Amortization of ROU assets $ 2,267 Interest on finance lease obligations $ 2,006 Total net lease cost $ 123,970 |
Schedule of supplemental balance sheet information related to leases | Supplemental balance sheet information related to leases was as follows: March 31, 2019 Operating leases: Related Party Other Total Operating lease ROU assets $ 3,059,939 $ 299,871 $ 3,359,810 Current operating lease liabilities $ 144,078 $ 66,769 $ 210,847 Noncurrent operating lease liabilities 3,379,897 267,527 3,647,424 Total operating lease liabilities $ 3,523,975 $ 334,296 $ 3,858,271 Finance leases: March 31, 2019 Property and equipment, at cost $ 47,367 Accumulated amortization (15,794 ) Property and equipment, net $ 31,573 Current obligations of finance leases $ 7,303 Finance leases, net of current obligations 31,968 Total finance lease liabilities $ 39,271 Weighted average remaining lease term (in years): Operating leases 11.7 Finance leases 3.6 Weighted average discount rate: Operating leases 5.8 % Finance leases 20.9 % |
Schedule of supplemental cash flow information related to leases | Supplemental cash flow and other information related to leases was as follows: Three months ended March 31, 2019 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 100,110 Operating cash flows from finance leases $ 2,006 Financing cash flows from finance leases $ 1,411 |
Schedule of maturities of operating lease liabilities | Maturities of lease liabilities were as follows: Years Ending December 31st, Operating Leases Finance Leases 2019 (remaining nine months) $ 321,306 $ 10,861 2020 422,164 15,705 2021 434,829 14,143 2022 447,874 10,984 2023 461,310 5,609 Thereafter 3,308,155 — Total lease payments 5,395,638 57,302 Less amount representing interest (1,537,637 ) (18,031 ) Total lease obligations 3,858,271 39,271 Less current portion (210,847 ) (7,303 ) Long-term lease obligations $ 3,647,424 $ 31,968 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of redeemable noncontrolling interest | The table below reflects the activity of the contingently redeemable non-controlling interest: Balance, December 31, 2018 $ 1,449,007 Net loss attributable to non-controlling interest in SureHarvest for the year to date period ended March 31, 2019 (43,835 ) Balance, March 31, 2019 $ 1,405,172 |
Segments (Tables)
Segments (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Segment Reporting [Abstract] | |
Schedule of operating segments | The following table shows information for reportable operating segments: Three months ended March 31, 2019 Three months ended March 31, 2018 Verification and Certification Segment Software Sales and Related Consulting Segment Eliminations and Other Consolidated Totals Verification and Certification Segment Software Sales and Related Consulting Segment Eliminations and Other Consolidated Totals Assets: Intangible and other assets, net $ 1,424,275 $ 2,273,725 $ — $ 3,698,000 $ 1,591,786 $ 2,166,298 $ — $ 3,758,084 Goodwill 1,133,122 2,010,612 — 3,143,734 1,279,762 1,372,488 — 2,652,250 Total assets 13,031,344 5,518,447 — 18,549,791 9,830,255 4,253,835 — 14,084,090 Revenues: Verification and certification service revenue $ 2,811,694 $ — $ — $ 2,811,694 $ 2,796,194 $ — $ — $ 2,796,194 Product sales 641,058 — — 641,058 353,894 — — 353,894 Software license, maintenance and support services revenue — 343,566 (48,537 ) 295,029 — 287,444 — 287,444 Software-related consulting service revenue — 221,223 (14,464 ) 206,759 — 183,270 — 183,270 Total revenues $ 3,452,752 $ 564,789 $ (63,001 ) $ 3,954,540 $ 3,150,088 $ 470,714 $ — $ 3,620,802 Costs of revenues: Costs of verification and certification services 1,594,763 — (32,673 ) 1,562,090 1,450,609 — — 1,450,609 Costs of products 443,185 — — 443,185 225,975 — — 225,975 Costs of software license, maintenance and support services — 154,003 — 154,003 — 137,434 — 137,434 Costs of software-related consulting services — 129,536 — 129,536 — 75,461 — 75,461 Total costs of revenues 2,037,948 283,539 (32,673 ) 2,288,814 1,676,584 212,895 — 1,889,479 Gross profit 1,414,804 281,250 (30,328 ) 1,665,726 1,473,504 257,819 — 1,731,323 Depreciation & amortization 81,938 178,183 — 260,121 77,997 138,046 — 216,043 Other operating expenses 1,510,592 225,954 (30,328 ) 1,706,218 1,332,397 156,034 — 1,488,431 Segment operating (loss)/income $ (177,726 ) $ (122,887 ) $ — $ (300,613 ) $ 63,110 $ (36,261 ) $ — $ 26,849 Other items to reconcile segment operating income (loss) to net income attributable to WFCF: Other expense (income) — — (30,649 ) (30,649 ) — — (1,839 ) (1,839 ) Income tax (benefit)/expense — — (83,000 ) (83,000 ) — — 8,000 8,000 Net loss attributable to non-controlling interest — 43,835 — 43,835 — — 14,796 14,796 Net (loss)/income attributable to WFCF $ (177,726 ) $ (79,052 ) $ 113,649 $ (143,129 ) $ 63,110 $ (36,261 ) $ 8,635 $ 35,484 |
Supplemental Cash Flow Inform_2
Supplemental Cash Flow Information (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Supplemental Cash Flow Information [Abstract] | |
Schedule of supplemental cash flow information | Three months ended March 31, 2019 2018 Cash paid during the year: Interest expense $ 3,047 $ 1,079 Income taxes $ — $ 7,283 |
The Company and Basis of Pres_2
The Company and Basis of Presentation (Details Narrative) - USD ($) | Mar. 31, 2019 | Jan. 02, 2019 |
Operating lease liabilities | $ 3,858,271 | |
Operating leases right-of-use | $ 3,359,810 | |
Accounting Standards Update 2016-02 [Member] | ||
Operating lease liabilities | $ 3,440,000 | |
Operating leases right-of-use | $ 3,540,000 |
Business Acquisitions (Details)
Business Acquisitions (Details) - USD ($) | Aug. 30, 2018 | May 16, 2018 | Mar. 31, 2019 | Dec. 31, 2018 | Mar. 31, 2018 |
Business Acquisition [Line Items] | |||||
Goodwill | $ 3,143,734 | $ 3,143,734 | $ 2,652,250 | ||
Sow Organic [Member] | |||||
Business Acquisition [Line Items] | |||||
Goodwill | $ 433,131 | ||||
Total consideration | 883,131 | ||||
Sow Organic [Member] | Software Acquired [Member] | |||||
Business Acquisition [Line Items] | |||||
Identifiable intangible assets | 156,000 | ||||
Sow Organic [Member] | Tradenames and Trademarks [Member] | |||||
Business Acquisition [Line Items] | |||||
Identifiable intangible assets | 48,000 | ||||
Sow Organic [Member] | Noncompete Agreements [Member] | |||||
Business Acquisition [Line Items] | |||||
Identifiable intangible assets | 84,000 | ||||
Sow Organic [Member] | Customer Relationships [Member] | |||||
Business Acquisition [Line Items] | |||||
Identifiable intangible assets | $ 162,000 | ||||
JVF Consulting LLC [Member] | |||||
Business Acquisition [Line Items] | |||||
Goodwill | $ 380,290 | ||||
Total consideration | 815,290 | ||||
JVF Consulting LLC [Member] | Software Acquired [Member] | |||||
Business Acquisition [Line Items] | |||||
Identifiable intangible assets | 207,000 | ||||
JVF Consulting LLC [Member] | Tradenames and Trademarks [Member] | |||||
Business Acquisition [Line Items] | |||||
Identifiable intangible assets | 87,000 | ||||
JVF Consulting LLC [Member] | Noncompete Agreements [Member] | |||||
Business Acquisition [Line Items] | |||||
Identifiable intangible assets | 37,000 | ||||
JVF Consulting LLC [Member] | Customer Relationships [Member] | |||||
Business Acquisition [Line Items] | |||||
Identifiable intangible assets | $ 104,000 |
Business Acquisitions (Details
Business Acquisitions (Details Narrative) - USD ($) | May 16, 2018 | Aug. 30, 2017 |
JVF Consulting [Member[ | ||
Cash payments for acquisition | $ 500,000 | |
Number of shares issued upon acquisition, shares | 158,437 | |
Value of shares issued upon acquisition | $ 315,300 | |
Sow Organic [Member] | ||
Cash payments for acquisition | $ 450,000 | |
Number of shares issued upon acquisition, shares | 217,654 | |
Value of shares issued upon acquisition | $ 433,100 |
Basic and Diluted Net Income _3
Basic and Diluted Net Income per Share (Details) - $ / shares | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Basic: | ||
Weighted average shares outstanding | 24,957,082 | 24,648,610 |
Diluted: | ||
Weighted average shares outstanding | 24,957,082 | 24,648,610 |
Weighted average effects of dilutive securities | 196,392 | |
Total | 24,957,082 | 24,845,002 |
Antidilutive securities: | $ 265,700 | $ 124,000 |
Investment in Progressive Bee_2
Investment in Progressive Beef, LLC (Details Narrative) - Progressive Beef, LLC [Member] - USD ($) | Aug. 09, 2018 | Mar. 31, 2019 |
Percentage of voting interests acquired | 10.00% | |
Beneficial lease arrangement | $ 991,000 | |
Amount paid in cash | $ 900,000 | |
Number of shares issued (in shares) | 50,340 | |
Value of number of shares issued | $ 91,100 | |
Business acquisition, share price (in dollars per share) | $ 1.81 | |
Dividend income | $ 30,000 |
Intangible and Other Assets (De
Intangible and Other Assets (Details) - USD ($) | Mar. 31, 2019 | Dec. 31, 2018 |
Intangible and other assets, gross | $ 4,944,353 | $ 4,944,353 |
Less accumulated amortization | 1,731,679 | 1,577,558 |
Intangible and other assets, net | 3,212,674 | 3,366,795 |
Tradenames/trademarks (not subject to amortization) | 465,000 | 465,000 |
Intangible and other assets, before other | 3,677,674 | 3,831,795 |
Other assets | 20,326 | 20,326 |
Intangible and other assets, net | 3,698,000 | 3,852,121 |
Tradenames and Trademarks [Member] | ||
Intangible and other assets, gross | 417,307 | 417,307 |
Accreditations [Member] | ||
Intangible and other assets, gross | 85,395 | 85,395 |
Customer Relationships [Member] | ||
Intangible and other assets, gross | 3,350,551 | 3,350,551 |
Patents [Member] | ||
Intangible and other assets, gross | 970,100 | 970,100 |
Noncompete Agreements [Member] | ||
Intangible and other assets, gross | $ 121,000 | $ 121,000 |
Accrued Expenses and Other Cu_3
Accrued Expenses and Other Current Liabilities (Details) - USD ($) | Mar. 31, 2019 | Dec. 31, 2018 |
Payables and Accruals [Abstract] | ||
Income and sales taxes payable | $ 25,800 | $ 19,978 |
Payroll related accruals | 224,572 | 147,798 |
Professional fees and other expenses | 317,563 | 251,843 |
Accrued Expenses and Other Current Liabilities | $ 567,935 | $ 419,619 |
Notes Payable (Details)
Notes Payable (Details) - USD ($) | Mar. 31, 2019 | Dec. 31, 2018 |
Notes Payable [Abstract] | ||
Vehicle note | $ 40,739 | $ 42,393 |
Less current portion of notes payable and other long-term debt | (10,299) | (10,173) |
Notes payable and other long-term debt | $ 30,440 | $ 32,220 |
Notes Payable (Details Narrativ
Notes Payable (Details Narrative) - USD ($) | 1 Months Ended | 3 Months Ended | |
Sep. 30, 2017 | Mar. 31, 2019 | Dec. 31, 2018 | |
Revolving Line of Credit [Member] | |||
Debt instrument, face amount | $ 75,080 | ||
Maturity date on debt | Apr. 12, 2020 | ||
Effective interest rate | 7.00% | 7.00% | |
Interest rate, basis spread | 1.50% | ||
Note Payable - Vehicle [Member] | |||
Debt instrument, face amount | $ 54,165 | ||
Interest and principal payments | $ 1,087 | ||
Interest rate | 7.44% |
Stock-Based Compensation (Detai
Stock-Based Compensation (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock-based compensation expense | $ 44,702 | $ 37,902 |
Stock Options [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock-based compensation expense | 38,744 | 16,431 |
Restricted Stock Awards [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock-based compensation expense | $ 5,958 | $ 21,471 |
Stock-Based Compensation (Det_2
Stock-Based Compensation (Details 1) | 3 Months Ended |
Mar. 31, 2018shares | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Number of options awarded to purchase common shares | 25,000 |
Risk-free interest rate | 2.60% |
Expected volatility | 154.30% |
Expected life of options from the date of grant | 9 years 9 months 18 days |
Stock-Based Compensation (Det_3
Stock-Based Compensation (Details 2) | Mar. 31, 2019USD ($) |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Unvested stock options | $ 295,631 |
Unvested restricted stock awards | 14,673 |
Total unrecognized compensation expense | 310,304 |
2019 [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Unvested stock options | 118,789 |
Unvested restricted stock awards | 9,716 |
Total unrecognized compensation expense | 128,505 |
2020 [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Unvested stock options | 110,072 |
Unvested restricted stock awards | 4,251 |
Total unrecognized compensation expense | 114,323 |
2021 [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Unvested stock options | 66,770 |
Unvested restricted stock awards | 706 |
Total unrecognized compensation expense | $ 67,476 |
Stock-Based Compensation (Det_4
Stock-Based Compensation (Details 3) | 3 Months Ended |
Mar. 31, 2019USD ($)$ / sharesshares | |
Number of awards | |
Balance, beginning | shares | 434,451 |
Balance, ending | shares | 434,451 |
Exercisable, ending | shares | 235,710 |
Unvested, ending | shares | 198,741 |
Weighted avg. exercise price per share | |
Balance, beginning | $ 1.49 |
Balance, ending | 1.49 |
Exercisable, ending | 1.16 |
Unvested, ending | 1.89 |
Weighted avg. grant date fair value per share | |
Balance, beginning | 1.47 |
Balance, ending | 1.47 |
Exercisable, ending | 1.16 |
Unvested, ending | $ 1.83 |
Weighted avg. remaining contractual life (in years) | |
Balance, beginning | 6 years 10 months 28 days |
Balance, ending | 6 years 8 months 12 days |
Exercisable, ending | 4 years 6 months 7 days |
Unvested, ending | 9 years 2 months 16 days |
Aggregate intrinsic value | |
Balance, beginning | $ | $ 230,039 |
Balance, ending | $ | 226,039 |
Exercisable, ending | $ | 197,593 |
Unvested, ending | $ | $ 28,447 |
Stock-Based Compensation (Det_5
Stock-Based Compensation (Details 4) - $ / shares | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Weighted Average Exercise Price | ||
Granted | $ 2.55 | |
Restricted Stock Awards [Member] | ||
Restricted Stock | ||
Balance, beginning | 30,000 | |
Granted | ||
Balance, ending | 30,000 | |
Weighted Average Exercise Price | ||
Balance, beginning | $ 2.38 | |
Granted | ||
Balance, ending | $ 2.38 |
Stock-Based Compensation (Det_6
Stock-Based Compensation (Details Narrative) | 3 Months Ended |
Mar. 31, 2018$ / sharesshares | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock options - Granted | shares | 25,000 |
Exercise price - Granted | $ / shares | $ 2.55 |
Income Taxes (Details Narrative
Income Taxes (Details Narrative) - USD ($) | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Income tax expense | $ (83,000) | $ 8,000 |
Percentage Owned | 24.30% | |
Sure Harvest [Member] | ||
Percentage Owned | 40.00% |
Revenue Recognition (Details)
Revenue Recognition (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Segment Reporting Information [Line Items] | ||
Total revenues | $ 3,954,540 | $ 3,620,802 |
Verification and Certification Service Revenue [Member] | ||
Segment Reporting Information [Line Items] | ||
Total revenues | 2,811,694 | 2,796,194 |
Product Sales [Member] | ||
Segment Reporting Information [Line Items] | ||
Total revenues | 641,058 | 353,894 |
Software License, Maintenance and Support Services Revenue [Member] | ||
Segment Reporting Information [Line Items] | ||
Total revenues | 295,029 | 287,444 |
Software-Related Consulting Service Revenue [Member] | ||
Segment Reporting Information [Line Items] | ||
Total revenues | 206,759 | 183,270 |
Verification and Certification Segment [Member] | ||
Segment Reporting Information [Line Items] | ||
Total revenues | 3,452,752 | 3,150,088 |
Verification and Certification Segment [Member] | Verification and Certification Service Revenue [Member] | ||
Segment Reporting Information [Line Items] | ||
Total revenues | 2,811,694 | 2,796,194 |
Verification and Certification Segment [Member] | Product Sales [Member] | ||
Segment Reporting Information [Line Items] | ||
Total revenues | 641,058 | 353,894 |
Software Sales and Related Consulting Segment [Member] | ||
Segment Reporting Information [Line Items] | ||
Total revenues | 564,789 | 470,714 |
Software Sales and Related Consulting Segment [Member] | Software License, Maintenance and Support Services Revenue [Member] | ||
Segment Reporting Information [Line Items] | ||
Total revenues | 343,566 | 287,444 |
Software Sales and Related Consulting Segment [Member] | Software-Related Consulting Service Revenue [Member] | ||
Segment Reporting Information [Line Items] | ||
Total revenues | 221,223 | 183,270 |
Eliminations And Other [Member] | ||
Segment Reporting Information [Line Items] | ||
Total revenues | (63,001) | |
Eliminations And Other [Member] | Software License, Maintenance and Support Services Revenue [Member] | ||
Segment Reporting Information [Line Items] | ||
Total revenues | (48,537) | |
Eliminations And Other [Member] | Software-Related Consulting Service Revenue [Member] | ||
Segment Reporting Information [Line Items] | ||
Total revenues | (14,464) | |
Consolidated [Member] | ||
Segment Reporting Information [Line Items] | ||
Total revenues | 3,954,540 | 3,620,802 |
Consolidated [Member] | Verification and Certification Service Revenue [Member] | ||
Segment Reporting Information [Line Items] | ||
Total revenues | 2,811,694 | 2,796,194 |
Consolidated [Member] | Product Sales [Member] | ||
Segment Reporting Information [Line Items] | ||
Total revenues | 641,058 | 353,894 |
Consolidated [Member] | Software License, Maintenance and Support Services Revenue [Member] | ||
Segment Reporting Information [Line Items] | ||
Total revenues | 295,029 | 287,444 |
Consolidated [Member] | Software-Related Consulting Service Revenue [Member] | ||
Segment Reporting Information [Line Items] | ||
Total revenues | $ 206,759 | $ 183,270 |
Revenue Recognition (Details Na
Revenue Recognition (Details Narrative) - USD ($) | Mar. 31, 2019 | Dec. 31, 2018 |
Accounts receivable from contract with customers | $ 2,005,800 | $ 2,205,200 |
Deposits and Deferred Revenue [Member] | ||
Contract of customer liability | $ 1,362,900 | $ 727,900 |
Leases (Details)
Leases (Details) | 3 Months Ended |
Mar. 31, 2019USD ($) | |
Lessee Disclosure [Abstract] | |
Operating lease cost | $ 119,697 |
Finance lease cost amortization of ROU assets | 2,267 |
Interest on finance lease obligations | 2,006 |
Total net lease cost | $ 123,970 |
Leases (Details 1)
Leases (Details 1) - USD ($) | Mar. 31, 2019 | Dec. 31, 2018 |
Operating lease ROU assets | $ 3,359,810 | |
Current operating lease liabilities | 210,847 | |
Noncurrent operating lease liabilities | 3,647,424 | |
Total operating lease liabilities | 3,858,271 | |
Property and equipment, net | 1,765,595 | $ 1,675,472 |
Current obligations of finance leases | 7,303 | 11,309 |
Finance leases, net of current obligations | 31,968 | $ 32,747 |
Total finance lease liabilities | $ 39,271 | |
Weighted average remaining operating lease term (in years) | 11 years 8 months 12 days | |
Weighted average remaining finance lease term (in years) | 3 years 7 months 6 days | |
Operating leases weighted average discount rate | 7.00% | |
Finance leases weighted average discount rate | 20.90% | |
Related Party [Member] | ||
Operating lease ROU assets | $ 3,059,939 | |
Current operating lease liabilities | 144,078 | |
Noncurrent operating lease liabilities | 3,379,897 | |
Total operating lease liabilities | 3,523,975 | |
Other [Member] | ||
Operating lease ROU assets | 29,981 | |
Current operating lease liabilities | 66,769 | |
Noncurrent operating lease liabilities | 267,527 | |
Total operating lease liabilities | 334,296 | |
Finance Leases [Member] | ||
Property and equipment, at cost | 47,367 | |
Accumulated amortization | (15,794) | |
Property and equipment, net | $ 31,573 |
Leases (Details 2)
Leases (Details 2) | 3 Months Ended |
Mar. 31, 2019USD ($) | |
Lessee Disclosure [Abstract] | |
Operating cash flows from operating leases | $ 100,110 |
Operating cash flows from finance leases | 2,006 |
Financing cash flows from finance leases | $ 1,411 |
Leases (Details 3)
Leases (Details 3) - USD ($) | Mar. 31, 2019 | Dec. 31, 2018 |
Operating Leases | ||
2019 (remaining nine months) | $ 321,306 | |
2020 | 422,164 | |
2021 | 434,829 | |
2022 | 447,874 | |
2023 | 461,310 | |
Thereafter | 3,308,155 | |
Total lease payments | 5,395,638 | |
Less amount representing interest | (1,537,637) | |
Total lease obligations | 3,858,271 | |
Less current portion | (210,847) | |
Long-term lease obligations | 3,647,424 | |
Finance Leases | ||
2019 (remaining nine months) | 10,861 | |
2020 | 15,705 | |
2021 | 14,143 | |
2022 | 10,984 | |
2023 | 5,609 | |
Total lease payments | 57,302 | |
Less amount representing interest | (18,031) | |
Total lease obligations | 39,271 | |
Less current portion | (7,303) | $ (11,309) |
Long-term lease obligations | $ 31,968 | $ 32,747 |
Leases (Details Narrative)
Leases (Details Narrative) | 3 Months Ended |
Mar. 31, 2019USD ($) | |
Lessee, Operating Lease, Existence of Option to Extend | true |
Lessee, Operating Lease, Option to Extend | P5Y |
Operating lease cost | $ 119,697 |
Ownership Interest | 24.30% |
Maximum [Member] | |
Leases Term | 15 years |
Minimum [Member] | |
Leases Term | 1 year |
Corporate Headquarters [Member] | |
Operating lease cost | $ 92,200 |
Commitments and Contingencies_2
Commitments and Contingencies (Details) | 3 Months Ended |
Mar. 31, 2019USD ($) | |
Commitments and Contingencies Disclosure [Abstract] | |
Redeemable noncontrolling interest, beginning | $ 1,449,007 |
Net loss attributable to non-controlling interest | (43,835) |
Redeemable noncontrolling interest, ending | $ 1,405,172 |
Commitments and Contingencies_3
Commitments and Contingencies (Details Narrative) - SureHarvest Services LLC [Member] | Dec. 28, 2016USD ($)shares |
Percentage of business acquired | 60.00% |
Total consideration for acquisition | $ 2,660,000 |
Cash payments for acquisition | $ 1,122,000 |
Number of shares issued upon acquisition, shares | shares | 850,852 |
Value of shares issued upon acquisition | $ 1,534,900 |
Percentage of remaining ownership interest | 40.00% |
Assumed purchase price of remaining ownership interest | $ 8,000,000 |
Segments (Details)
Segments (Details) - USD ($) | 3 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | Dec. 31, 2018 | |
Assets: | |||
Intangible and other assets, net | $ 3,698,000 | $ 3,758,084 | |
Goodwill | 3,143,734 | 2,652,250 | $ 3,143,734 |
Total assets | 18,549,791 | 14,084,090 | $ 14,463,938 |
Revenues: | |||
Total revenues | 3,954,540 | 3,620,802 | |
Costs of revenues: | |||
Total costs of revenues | 2,288,814 | 1,889,479 | |
Gross profit | 1,665,726 | 1,731,323 | |
Depreciation & amortization | 260,121 | 272,500 | |
Other operating expenses | 1,706,218 | 1,488,431 | |
Segment operating (loss)/income | (300,613) | 26,849 | |
Other items to reconcile segment operating income (loss) to net income attributable to WFCF: | |||
Other expense (income) | (30,649) | (1,839) | |
Income tax (benefit)/expense | (83,000) | 8,000 | |
Net loss attributable to non-controlling interest | 43,835 | 14,796 | |
Net (loss)/income attributable to WFCF | (143,129) | 35,484 | |
Verification and Certification Service Revenue [Member] | |||
Revenues: | |||
Total revenues | 2,811,694 | 2,796,194 | |
Costs of revenues: | |||
Total costs of revenues | 1,562,090 | 1,450,609 | |
Product Sales [Member] | |||
Revenues: | |||
Total revenues | 641,058 | 353,894 | |
Costs of revenues: | |||
Total costs of revenues | 443,185 | 225,975 | |
Software License, Maintenance and Support Services Revenue [Member] | |||
Revenues: | |||
Total revenues | 295,029 | 287,444 | |
Costs of revenues: | |||
Total costs of revenues | 154,003 | 137,434 | |
Software-Related Consulting Service Revenue [Member] | |||
Revenues: | |||
Total revenues | 206,759 | 183,270 | |
Costs of revenues: | |||
Total costs of revenues | 129,536 | 75,461 | |
Verification and Certification Segment [Member] | |||
Assets: | |||
Intangible and other assets, net | 1,424,275 | 1,591,786 | |
Goodwill | 1,133,122 | 1,279,762 | |
Total assets | 13,031,344 | 9,830,255 | |
Revenues: | |||
Total revenues | 3,452,752 | 3,150,088 | |
Costs of revenues: | |||
Total costs of revenues | 1,562,090 | 1,450,609 | |
Gross profit | 1,414,804 | 1,473,504 | |
Depreciation & amortization | 81,938 | 77,997 | |
Other operating expenses | 1,510,592 | 1,332,397 | |
Segment operating (loss)/income | (177,726) | 63,110 | |
Other items to reconcile segment operating income (loss) to net income attributable to WFCF: | |||
Net (loss)/income attributable to WFCF | (177,726) | 63,110 | |
Verification and Certification Segment [Member] | Verification and Certification Service Revenue [Member] | |||
Revenues: | |||
Total revenues | 2,811,694 | 2,796,194 | |
Costs of revenues: | |||
Total costs of revenues | 1,594,763 | 1,450,609 | |
Verification and Certification Segment [Member] | Product Sales [Member] | |||
Revenues: | |||
Total revenues | 641,058 | 353,894 | |
Costs of revenues: | |||
Total costs of revenues | 443,185 | 225,975 | |
Other [Member] | |||
Revenues: | |||
Total revenues | (63,001) | ||
Costs of revenues: | |||
Total costs of revenues | (32,673) | ||
Gross profit | (30,328) | ||
Other operating expenses | (30,328) | ||
Other items to reconcile segment operating income (loss) to net income attributable to WFCF: | |||
Other expense (income) | (30,649) | (1,839) | |
Income tax (benefit)/expense | (83,000) | 8,000 | |
Net loss attributable to non-controlling interest | 14,796 | ||
Net (loss)/income attributable to WFCF | 113,649 | 8,635 | |
Other [Member] | Software License, Maintenance and Support Services Revenue [Member] | |||
Revenues: | |||
Total revenues | (48,537) | ||
Other [Member] | Software-Related Consulting Service Revenue [Member] | |||
Revenues: | |||
Total revenues | (14,464) | ||
Software Sales and Related Consulting Segment [Member] | |||
Assets: | |||
Intangible and other assets, net | 2,273,725 | 2,166,298 | |
Goodwill | 2,010,612 | 1,372,488 | |
Total assets | 5,518,447 | 4,253,835 | |
Revenues: | |||
Total revenues | 564,789 | 470,714 | |
Costs of revenues: | |||
Total costs of revenues | 283,539 | 212,895 | |
Gross profit | 281,250 | 257,819 | |
Depreciation & amortization | 178,183 | 138,046 | |
Other operating expenses | 225,954 | 156,034 | |
Segment operating (loss)/income | (122,887) | (36,261) | |
Other items to reconcile segment operating income (loss) to net income attributable to WFCF: | |||
Net loss attributable to non-controlling interest | 43,835 | ||
Net (loss)/income attributable to WFCF | (79,052) | (36,261) | |
Software Sales and Related Consulting Segment [Member] | Software License, Maintenance and Support Services Revenue [Member] | |||
Revenues: | |||
Total revenues | 343,566 | 287,444 | |
Costs of revenues: | |||
Total costs of revenues | 154,003 | 137,434 | |
Software Sales and Related Consulting Segment [Member] | Software-Related Consulting Service Revenue [Member] | |||
Revenues: | |||
Total revenues | 221,223 | 183,270 | |
Costs of revenues: | |||
Total costs of revenues | $ 129,536 | $ 75,461 |
Supplemental Cash Flow Inform_3
Supplemental Cash Flow Information (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Supplemental Cash Flow Information Details Abstract | ||
Interest expense | $ 3,047 | $ 1,079 |
Income taxes | $ 7,283 |