Vicon Industries (VCON) 10-Q 15 May 17 2017 Q2 Quarterly report Financial data

Document and Entity Information

Document and Entity Information Document - shares	6 Months Ended
	Mar. 31, 2017	May 09, 2017
Entity Information [Line Items]
Entity Registrant Name	VICON INDUSTRIES INC /NY/
Entity Central Index Key	310,056
Current Fiscal Year End Date	--09-30
Entity Filer Category	Smaller Reporting Company
Document Type	10-Q
Document Period End Date	Mar. 31, 2017
Document Fiscal Year Focus	2,017
Document Fiscal Period Focus	Q2
Amendment Flag	false
Entity Common Stock, Shares Outstanding		9,348,388

Condensed Consolidated Balance

Condensed Consolidated Balance Sheets - USD ($)	Mar. 31, 2017	Sep. 30, 2016
CURRENT ASSETS
Cash and cash equivalents	$ 2,072,588	$ 1,954,422
Marketable securities	13,343	13,545
Accounts receivable, net	4,486,792	6,158,504
Inventories:
Parts, components, and materials	1,042,123	1,432,135
Work-in-process	1,418,521	812,455
Finished products	4,882,182	4,745,660
Inventory net	7,342,826	6,990,250
Prepaid expenses and other current assets	551,616	572,440
TOTAL CURRENT ASSETS	14,467,165	15,689,161
Property, plant and equipment	5,928,340	5,865,969
Less accumulated depreciation and amortization	(5,442,739)	(5,345,786)
Property, Plant and Equipment Net	485,601	520,183
Intangible assets, net	972,500	1,106,500
Other assets	769,457	761,865
TOTAL ASSETS	16,694,723	18,077,709
CURRENT LIABILITIES
Accounts payable	3,239,518	2,551,080
Accrued compensation and employee benefits	1,767,365	1,701,103
Accrued expenses	1,303,826	1,472,272
Unearned revenue	355,592	476,565
TOTAL CURRENT LIABILITIES	6,666,301	6,201,020
Long-term Line of Credit, Noncurrent	2,750,000	1,750,000
Unearned revenue	95,728	76,950
Other long-term liabilities	1,560,637	1,522,825
TOTAL LIABILITIES	11,072,666	9,550,795
SHAREHOLDERS’ EQUITY
Common stock, par value $.01	100,448	100,448
Capital in excess of par value	40,542,451	40,517,919
Retained earnings	(31,330,069)	(28,124,959)
Less treasury stock, at cost	(3,437,643)	(3,437,643)
Accumulated other comprehensive loss	(253,130)	(528,851)
TOTAL SHAREHOLDERS’ EQUITY	5,622,057	8,526,914
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$ 16,694,723	$ 18,077,709

Condensed Consolidated Statemen

Condensed Consolidated Statements of Operations - USD ($)	3 Months Ended		6 Months Ended
	Mar. 31, 2017	Mar. 31, 2016	Mar. 31, 2017	Mar. 31, 2016
Document Period End Date			Mar. 31, 2017
Net sales	$ 6,003,382	$ 7,998,124	$ 12,608,360	$ 18,878,680
Cost of sales	3,757,137	5,359,153	7,789,956	11,968,535
Gross profit	2,246,245	2,638,971	4,818,404	6,910,145
Operating expenses:
Selling, general and administrative expense	2,801,538	3,726,200	5,482,395	7,656,350
Engineering & development expense	1,289,475	1,339,658	2,429,451	2,658,054
Goodwill, Impairment Loss	0	6,016,469	0	6,016,469
Operating Expenses	4,091,013	11,082,327	7,911,846	16,330,873
Operating loss	(1,844,768)	(8,443,356)	(3,093,442)	(9,420,728)
Gain (Loss) on Disposition of Assets	0	784,896	0	784,896
Interest income	170	160	403	324
Interest expense	(58,503)	0	(112,071)	0
Loss before income taxes	(1,903,101)	(7,658,300)	(3,205,110)	(8,635,508)
Income tax expense	0	0	0	0
Net loss	$ (1,903,101)	$ (7,658,300)	$ (3,205,110)	$ (8,635,508)
Loss per share:
Earnings Per Share, Basic	$ (0.20)	$ (0.82)	$ (0.34)	$ (0.92)
Earnings Per Share, Diluted	$ (0.20)	$ (0.82)	$ (0.34)	$ (0.92)
Weighted average shares outstanding:
Basic	9,348,388	9,341,038	9,348,388	9,335,880
Diluted	9,348,388	9,341,038	9,348,388	9,335,880

Condensed Consolidated Stateme4

Condensed Consolidated Statements of Comprehensive Income (Loss) - USD ($)	3 Months Ended		6 Months Ended
	Mar. 31, 2017	Mar. 31, 2016	Mar. 31, 2017	Mar. 31, 2016
Net loss	$ (1,903,101)	$ (7,658,300)	$ (3,205,110)	$ (8,635,508)
Other comprehensive income (loss):
Unrealized loss on securities, net of tax	(38)	159	(449)	74
Foreign currency translation adjustment	140,932	184,391	(276,170)	27,082
Other comprehensive loss	140,894	(184,232)	275,721	(27,008)
Comprehensive loss	$ (1,762,207)	$ (7,842,532)	$ (2,929,389)	$ (8,662,516)

Condensed Consolidated Stateme5

Condensed Consolidated Statements of Cash Flows - USD ($)	6 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Revolving credit borrowings	$ 1,000,000	$ 0
Document Period End Date	Mar. 31, 2017
Cash flows from operating activities:
Net loss	$ (3,205,110)	(8,635,508)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Goodwill, Impairment Loss	0	6,016,469
Gain (Loss) on Disposition of Assets	0	(784,896)
Depreciation and amortization	258,773	425,565
Amortization of deferred compensation	738	742
Stock compensation expense	23,794	298,778
Change in assets and liabilities:
Accounts receivable, net	1,592,307	4,407,978
Inventories	(401,213)	(623,947)
Prepaid expenses and other current assets	14,886	(271,183)
Other assets	(7,593)	(23,840)
Accounts payable	707,076	(1,073,879)
Accrued compensation and employee benefits	70,627	(796,443)
Accrued expenses	(163,235)	(233,268)
Unearned revenue	(102,195)	(507,389)
Other liabilities	40,327	11,443
Net cash provided by (used in)	(1,170,818)	(1,789,378)
Cash flows from investing activities:
Proceeds from sale of building, net	0	1,512,320
Increase (Decrease) in Trading Securities	(247)	(173)
Payments to Acquire Property, Plant, and Equipment	(94,371)	(112,619)
Net Cash Provided by (Used in) Investing Activities	(94,618)	1,399,528
Net Cash Provided by (Used in) Financing Activities [Abstract]
Proceeds from Stock Options Exercised	0	5,184
Net Cash Provided by (Used in) Financing Activities	1,000,000	5,184
Effect of Exchange Rate on Cash and Cash Equivalents	383,602	165,767
Cash and Cash Equivalents, Period Increase (Decrease)	118,166	(218,899)
Cash at beginning of year	1,954,422	$ 2,390,409
Cash at end of period	$ 2,072,588

Basis of Presentation

Basis of Presentation	6 Months Ended
	Mar. 31, 2017
Basis of Presentation [Abstract]
Organization, Consolidation and Presentation of Financial Statements Disclosure [Text Block]	Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and the instructions to Form 10-Q and Rule 8-03 of Regulation S-X. Accordingly, they do not include all the information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the six months ended March 31, 2017 are not necessarily indicative of the results that may be expected for the fiscal year ended September 30, 2017 . For further information, refer to the consolidated financial statements and footnotes thereto included in the Company’s annual report on Form 10-K for the fiscal year ended September 30, 2016 .

Marketable Securities

Marketable Securities	6 Months Ended
	Mar. 31, 2017
Marketable Securities [Abstract]
Cash, Cash Equivalents, and Marketable Securities [Text Block]	Marketable Securities Marketable securities consist of mutual fund investments principally in federal, state and local government debt securities of $13,343 as of March 31, 2017 . Such mutual fund investments are stated at market value based on quoted market prices (Level 1 inputs) and are classified as available-for-sale under the provisions of Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) 320, with unrealized gains and losses reported in accumulated other comprehensive loss as a component of shareholders’ equity. The cost of such securities at March 31, 2017 was $13,927 , with $584 of cumulative unrealized losses reported at March 31, 2017 .

Accounts Receivable

Accounts Receivable	6 Months Ended
	Mar. 31, 2017
Accounts Receivable [Abstract]
Schedule of Valuation and Qualifying Accounts Disclosure [Text Block]	Accounts Receivable Accounts receivable is stated net of an allowance for uncollectible accounts of $1,025,000 and $1,069,000 as of March 31, 2017 and September 30, 2016 , respectively.

Loss per Share

Loss per Share	6 Months Ended
	Mar. 31, 2017
Loss per Share [Abstract]
Earnings Per Share [Text Block]	Loss per Share Basic loss per share (EPS) is computed based on the weighted average number of common shares outstanding for the period. Diluted EPS reflects the maximum dilution that would have resulted from incremental common shares issuable upon the exercise of stock options and under deferred compensation agreements. The following tables provide the components of the basic and diluted EPS computations for the three and six month periods ended March 31, 2017 and 2016 : Three Months Ended Six Months Ended March 31, March 31, 2017 2016 2017 2016 Basic EPS Computation Net loss $ (1,903,101 ) $ (7,658,300 ) $ (3,205,110 ) $ (8,635,508 ) Weighted average shares outstanding 9,348,388 9,341,038 9,348,388 9,335,880 Basic loss per share $ (.20 ) $ (.82 ) $ (.34 ) $ (.92 ) Three Months Ended Six Months Ended March 31, March 31, 2017 2016 2017 2016 Diluted EPS Computation Net loss $ (1,903,101 ) $ (7,658,300 ) $ (3,205,110 ) $ (8,635,508 ) Weighted average shares outstanding 9,348,388 9,341,038 9,348,388 9,335,880 Stock options — — — — Stock compensation arrangements — — — — Diluted shares outstanding 9,348,388 9,341,038 9,348,388 9,335,880 Diluted loss per share $ (.20 ) $ (.82 ) $ (.34 ) $ (.92 ) For the for the three and six month periods ended March 31, 2017 and 2016 , all outstanding stock options and shares issuable under stock compensation arrangements totaling 623,587 and 670,300 shares, respectively, have been omitted from the calculation of diluted EPS as their effect would have been antidilutive. The actual effect of these stock options and shares, if any, on the diluted earnings per share calculation will vary significantly depending on fluctuations in the market price of the Company's stock.

Accumulated Other Comprehensive

Accumulated Other Comprehensive Loss	6 Months Ended
	Mar. 31, 2017
Comprehensive Loss [Abstract]
Comprehensive Income (Loss) Note [Text Block]	Accumulated Other Comprehensive Loss The Company's accumulated other comprehensive loss balances at March 31, 2017 and September 30, 2016 consisted of the following: March 31, 2017 September 30, 2016 Foreign currency translation adjustment $ (252,546 ) $ (528,716 ) Unrealized loss on marketable securities (584 ) (135 ) Accumulated other comprehensive loss $ (253,130 ) $ (528,851 )

Goodwill and Intangible Assets

Goodwill and Intangible Assets	6 Months Ended
	Mar. 31, 2017
Goodwill and Intangible Assets Disclosure [Abstract]
Goodwill and Intangible Assets Disclosure [Text Block]	The components and estimated useful lives of intangible assets as of March 31, 2017 and September 30, 2016 are stated below. Amortization is provided on a straight line method, or in the case of customer relationships, on an accelerated method, over the following estimated useful lives: March 31, 2017 September 30, 2016 Gross Amount Accumulated Amortization Gross Amount Accumulated Amortization Estimated Useful Life Definite-lived intangibles: Customer relationships $ 910,000 $ 483,833 $ 910,000 $ 371,833 7 years Tradenames 660,000 113,667 660,000 91,667 15 years $ 1,570,000 $ 597,500 $ 1,570,000 $ 463,500 Amortization expense was $67,000 and $129,250 for the three month periods ended March 31, 2017 and 2016 , respectively, and $134,000 and $258,500 for the six month periods ended March 31, 2017 and 2016 , respectively. Future amortization expense for intangible assets over the next five years ending September 30 and thereafter is summarized as follows: Fiscal Year Amount Remainder of 2017 $ 134,000 2018 177,000 2019 123,000 2020 91,000 2021 72,000 Thereafter $ 375,500

Stock Based Compensation

Stock Based Compensation	6 Months Ended
	Mar. 31, 2017
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Disclosure of Compensation Related Costs, Share-based Payments [Text Block]	Stock-Based Compensation The Company maintains stock option plans that include both incentive and non-qualified options reserved for issuance to key employees, including officers and directors. All options are issued at fair market value at the grant date and are exercisable in varying installments according to the plans. The plans allow for the payment of option exercises through the surrender of previously owned mature shares based on the fair market value of such shares at the date of surrender. The Company follows ASC 718 (“Share-Based Payment”), which requires that all share based payments to employees, including stock options, be recognized as compensation expense in the consolidated financial statements based on their grant date fair values and over the requisite service period. For the three month periods ended March 31, 2017 and 2016 , the Company recorded non-cash compensation expense of $11,395 and $145,580 , respectively ( $.00 and $.02 per basic and diluted share, respectively), relating to stock compensation. For the six month periods ended March 31, 2017 and 2016 , the Company recorded non-cash compensation expense of $23,794 and $298,778 , respectively ( $.00 and $.03 per basic and diluted share, respectively), relating to stock compensation.

Recent Accounting Pronouncement

Recent Accounting Pronouncements	6 Months Ended
	Mar. 31, 2017
Recent Accounting Pronouncements [Abstract]
Description of New Accounting Pronouncements Not yet Adopted [Text Block]	Recent Accounting Pronouncements In May 2014, the FASB issued guidance on revenue from contracts with customers. The underlying principle is that an entity will recognize revenue to depict the transfer of goods or services to customers at an amount that the entity expects to be entitled to in exchange for those goods or services. The guidance provides a five-step analysis of transactions to determine when and how revenue is recognized. Other major provisions include capitalization of certain contract costs, consideration of time value of money in the transaction price, and allowing estimates of variable consideration to be recognized before contingencies are resolved, in certain circumstances. The guidance also requires enhanced disclosures regarding the nature, amount, timing and uncertainty of revenue and cash flows arising from an entity's contracts with customers. This guidance permits the use of either the retrospective or cumulative effect transition method and is effective for the Company beginning in 2019; early adoption is not permitted prior to 2018. The Company is currently in the initial stages of evaluating the effect of implementing this guidance. In February 2016, the FASB issued guidance on lease accounting requiring lessees to recognize a right-of-use asset and a lease liability for long-term leases. The liability will be equal to the present value of lease payments. This guidance must be applied using a modified retrospective transition approach to all annual and interim periods presented and is effective for the Company beginning in fiscal 2019. The Company is currently in the initial stages of evaluating the effect of implementing this guidance. In March 2016, the FASB issued guidance on simplifying several aspects of accounting for share-based payment award transactions, including income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. This guidance requires a mix of prospective, modified retrospective, and retrospective transition to all annual and interim periods presented and is effective for the Company beginning in fiscal 2018. The Company is currently in the initial stages of evaluating the effect of implementing this guidance.

Income Taxes

Income Taxes	6 Months Ended
	Mar. 31, 2017
Income Taxes [Abstract]
Income Tax Disclosure [Text Block]	Income Taxes Deferred tax assets and liabilities are recognized based on the differences between the financial statement carrying amounts and the tax basis of assets and liabilities. Deferred tax assets represent items to be used as a tax deduction or credit in future tax returns for which a tax benefit has been recorded in the income statement. The Company has a valuation allowance against its deferred tax assets due to the uncertainty of future realization. The full valuation allowance is determined to be appropriate due to the Company's operating losses since fiscal year 2010 and the inherent uncertainties of predicting future operating results in periods over which such net tax differences become deductible. At September 30, 2016, the Company had $13.4 million of unrecognized net deferred tax assets available, which includes approximately $8.8 million of tax effected U.S. and foreign net operating loss carryforwards. On August 29, 2014, the Company merged with IQinVision, Inc. In connection with this merger, the Company's ability to utilize pre-merger net operating losses and tax credit carryforwards in the future is subject to certain limitations pursuant to Section 382 of the Internal Revenue Code. The annual limitation on utilization of the Company's U.S. net operating loss carryforwards is presently estimated at $500,000. The Company recognizes potential accrued interest and penalties related to unrecognized tax benefits in income tax expense. The Company files U.S. Federal and State income tax returns and foreign tax returns in the United Kingdom, Germany and Israel. The Company is generally no longer subject to tax examinations in such jurisdictions for fiscal years prior to 2013 in the U.S. and 2010 in the U.K., Germany and Israel.

Fair Value

Fair Value	6 Months Ended
	Mar. 31, 2017
Fair Value [Abstract]
Fair Value Disclosures [Text Block]	Fair Value The majority of the Company’s non-financial assets and liabilities are not required to be carried at fair value on a recurring basis, but the Company is required on a non-recurring basis to use fair value measurements when analyzing asset impairment as it relates to long-lived assets. The carrying amounts for trade accounts, other receivables, accounts payable and revolving credit borrowings approximate fair value due to either the short-term maturity of these instruments or the fact that the interest rate of the revolving credit borrowings is based upon current market rates. Fair value estimates are made at a specific point in time based on relevant market information about the financial instrument. These estimates are subjective in nature and involve uncertainties and matters of significant judgment and, therefore, cannot be determined with precision. Changes in assumptions could significantly affect the estimates.

Product Warranties (Notes)

Product Warranties (Notes)	6 Months Ended
	Mar. 31, 2017
Product Warranties [Abstract]
Standard Product Warranty, Policy [Policy Text Block]	Product Warranties The Company provides for the estimated cost of product warranties at the time revenue is recognized. While the Company engages in product quality programs and processes, including monitoring and evaluating the quality of its component suppliers, its warranty obligation is affected by product failure rates, material usage and service delivery costs incurred in correcting a product failure. Should actual product failure rates, material usage or service delivery costs differ from its estimates, revisions to the estimated warranty liability may be required. Changes in the Company's warranty liability (included in accrued expenses) for the three and six month periods ended March 31, 2017 and 2016 were as follows: Three Months Ended March 31, Six Months Ended March 31, 2017 2016 2017 2016 Balance at beginning of period $ 650,000 $ 650,000 $ 650,000 $ 650,000 Provision for warranties 102,000 110,000 216,000 218,000 Expenses incurred (102,000 ) (110,000 ) (216,000 ) (218,000 ) Balance at end of period $ 650,000 $ 650,000 $ 650,000 $ 650,000

Credit Agreement (Notes)

Credit Agreement (Notes)	6 Months Ended
	Mar. 31, 2017
Line of Credit Facility [Line Items]
Schedule of Line of Credit Facilities [Table Text Block]	Credit Agreement On March 4, 2016, the Company entered into a Credit Agreement (the “Agreement”) with NIL Funding Corporation to provide a $3 million revolving line of credit for working capital purposes which was subsequently amended and restated on two occasions as described below. The Agreement provides for a borrowing formula based upon eligible accounts receivable and is secured by a first priority security interest in substantially all of the Company’s assets. Borrowings under the Agreement bore interest at a rate of 6.75% per annum. The Agreement also provides for an unused commitment fee equal to .5% per annum. The Agreement includes provisions that are customarily found in similar financing agreements. NIL Funding Corporation is an affiliate of The InterTech Group, whose Executive Vice President and Chief Operating Officer, Julian A. Tiedemann, serves as the Chairman of the Company’s Board of Directors. On August 18, 2016, the Company entered into an Amended and Restated Credit Agreement (the “Amended Agreement”) with NIL Funding Corporation which increased the $3 million revolving line of credit to $6 million. Under the Amended Agreement, the facility was to mature on October 2, 2018 and consisted of two credit lines of $4 million and $2 million which bore interest at rates of 6.95% per annum and 8.25% per annum, respectively. The $4 million line of credit was subject to a borrowing formula based upon eligible accounts receivable. The Amended Agreement also provided for an initial commitment fee of $60,000, which was paid at closing, as well as an unused commitment fee equal to .5% per annum. The Amended Agreement includes a financial covenant that requires the Company to maintain a specified minimum tangible net worth, as defined, and is otherwise substantially similar to the original Agreement with NIL Funding Corporation. At March 31, 2017, the Company was not in compliance with this covenant. As of March 31, 2017, outstanding borrowings under the Amended Agreement were $2,750,000. On April 20, 2017, the Company entered into a Second Amended and Restated Credit Agreement (the “Second Amended Agreement”) with NIL Funding Corporation, under which only $2 million of the $6 million facility is subject to a borrowing formula, effectively providing the Company with $2 million of additional borrowing availability. The Second Amended Agreement also extends the maturity date of the credit facility to April 2, 2019, and reduces the Company’s minimum tangible net worth requirement, but is otherwise substantially similar to the Amended Agreement. In connection with the Second Amended Agreement, NIL Funding was issued a three-year warrant to purchase 1.5 million shares of the Company's common stock at a price of $.40 per share.

Going Concern and Liquidity (No

Going Concern and Liquidity (Notes)	6 Months Ended
	Mar. 31, 2017
Risks and Uncertainties [Abstract]
Substantial Doubt about Going Concern [Text Block]	Going Concern and Liquidity The accompanying financial statements have been prepared on a going concern basis which assumes the Company will be able to realize its assets and discharge its liabilities in the normal course of business for the foreseeable future and, thus, do not include any adjustments relating to the recoverability and classification of assets and liabilities that may be necessary if the Company is unable to continue as a going concern. However, the Company's ability to continue as a going concern is dependent upon generating profitable operations in the future and obtaining the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they come due. The Company continues to incur operating losses due to decreased revenue levels and ongoing strategic investments. Since 2012, the Company has made a significant investment in the development of a completely new, and strategically critical, video management system (VMS). The first release of this product offering was launched in January 2017 and is ultimately expected to significantly enhance the Company’s market competitiveness. The funding of this major development effort has contributed to the ongoing operating losses and depletion of cash reserves. The Company has also encountered issues with certain of its camera offerings that have negatively impacted its revenues during the last twelve months. Although these issues have been substantially resolved, their market impact has lingered into fiscal 2017. In response, the Company phased in material operating expense reductions over the course of the past several years and will consider further cost cutting measures throughout the remainder of the fiscal year. However, the Company intends to continue funding the development of its new VMS platform and rebuilding its market channels. At March 31, 2017, the Company had $2.1 million of cash reserves and a maximum of $3.25 million of borrowings available under the Credit Agreement described above, which is subject in part to a borrowing-base formula. Cash losses over the past several years have been financed in part by the sale of the Company’s two principal operating facilities and ongoing management of working capital levels. The Company expects to continue to draw on its credit facility to finance its near term working capital needs. In addition, the Company is currently seeking additional funding sources to finance its aggressive product development roadmap and growth initiatives over the upcoming twelve month period. Since there are no guarantees that such plans will be successful and that the Company will have sufficient available cash to sustain its operations through the next twelve month period, there is substantial doubt about the Company's ability to continue as a going concern.

Loss per Share (Tables)

Loss per Share (Tables)	6 Months Ended
	Mar. 31, 2017
Loss per Share [Abstract]
Schedule of Earnings Per Share, Basic and Diluted [Table Text Block]	The following tables provide the components of the basic and diluted EPS computations for the three and six month periods ended March 31, 2017 and 2016 : Three Months Ended Six Months Ended March 31, March 31, 2017 2016 2017 2016 Basic EPS Computation Net loss $ (1,903,101 ) $ (7,658,300 ) $ (3,205,110 ) $ (8,635,508 ) Weighted average shares outstanding 9,348,388 9,341,038 9,348,388 9,335,880 Basic loss per share $ (.20 ) $ (.82 ) $ (.34 ) $ (.92 ) Three Months Ended Six Months Ended March 31, March 31, 2017 2016 2017 2016 Diluted EPS Computation Net loss $ (1,903,101 ) $ (7,658,300 ) $ (3,205,110 ) $ (8,635,508 ) Weighted average shares outstanding 9,348,388 9,341,038 9,348,388 9,335,880 Stock options — — — — Stock compensation arrangements — — — — Diluted shares outstanding 9,348,388 9,341,038 9,348,388 9,335,880 Diluted loss per share $ (.20 ) $ (.82 ) $ (.34 ) $ (.92 )

Accumulated Other Comprehensi20

Accumulated Other Comprehensive Loss (Tables)	6 Months Ended
	Mar. 31, 2017
Comprehensive Loss [Abstract]
Schedule of Accumulated Other Comprehensive Income (Loss) [Table Text Block]	The Company's accumulated other comprehensive loss balances at March 31, 2017 and September 30, 2016 consisted of the following: March 31, 2017 September 30, 2016 Foreign currency translation adjustment $ (252,546 ) $ (528,716 ) Unrealized loss on marketable securities (584 ) (135 ) Accumulated other comprehensive loss $ (253,130 ) $ (528,851 )

Goodwill and Intangible Assets

Goodwill and Intangible Assets (Tables)	6 Months Ended
	Mar. 31, 2017
Finite-Lived Intangible Assets [Line Items]
Schedule of Goodwill [Table Text Block]
Schedule of Finite-Lived Intangible Assets, Future Amortization Expense [Table Text Block]	Future amortization expense for intangible assets over the next five years ending September 30 and thereafter is summarized as follows: Fiscal Year Amount Remainder of 2017 $ 134,000 2018 177,000 2019 123,000 2020 91,000 2021 72,000 Thereafter $ 375,500
Schedule of Finite-Lived Intangible Assets [Table Text Block]	The components and estimated useful lives of intangible assets as of March 31, 2017 and September 30, 2016 are stated below. Amortization is provided on a straight line method, or in the case of customer relationships, on an accelerated method, over the following estimated useful lives: March 31, 2017 September 30, 2016 Gross Amount Accumulated Amortization Gross Amount Accumulated Amortization Estimated Useful Life Definite-lived intangibles: Customer relationships $ 910,000 $ 483,833 $ 910,000 $ 371,833 7 years Tradenames 660,000 113,667 660,000 91,667 15 years $ 1,570,000 $ 597,500 $ 1,570,000 $ 463,500

Product Warranties (Tables)

Product Warranties (Tables)	6 Months Ended
	Mar. 31, 2017
Product Warranties [Abstract]
Schedule of Product Warranty Liability [Table Text Block]	Changes in the Company's warranty liability (included in accrued expenses) for the three and six month periods ended March 31, 2017 and 2016 were as follows: Three Months Ended March 31, Six Months Ended March 31, 2017 2016 2017 2016 Balance at beginning of period $ 650,000 $ 650,000 $ 650,000 $ 650,000 Provision for warranties 102,000 110,000 216,000 218,000 Expenses incurred (102,000 ) (110,000 ) (216,000 ) (218,000 ) Balance at end of period $ 650,000 $ 650,000 $ 650,000 $ 650,000

Marketable Securities (Details)

Marketable Securities (Details) - USD ($)	Mar. 31, 2017	Sep. 30, 2016
Marketable Securities [Abstract]
Available-for-sale Securities, Amortized Cost Basis	$ 13,927
Available-for-sale Securities, Accumulated Gross Unrealized Loss, before Tax	584	$ 135
Available-for-sale Securities, Debt Securities	$ 13,343

Accounts Receivable (Details)

Accounts Receivable (Details) - USD ($)	Mar. 31, 2017	Sep. 30, 2016
Accounts Receivable [Abstract]
Allowance for Doubtful Accounts Receivable, Current	$ 1,025,000	$ 1,069,000

Loss per Share (Details)

Loss per Share (Details) - USD ($)	3 Months Ended		6 Months Ended
	Mar. 31, 2017	Mar. 31, 2016	Mar. 31, 2017	Mar. 31, 2016
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items]
Net Income (Loss) Attributable to Parent	$ (1,903,101)	$ (7,658,300)	$ (3,205,110)	$ (8,635,508)
Weighted Average Number of Shares Outstanding, Basic	9,348,388	9,341,038	9,348,388	9,335,880
Earnings Per Share, Basic	$ (0.20)	$ (0.82)	$ (0.34)	$ (0.92)

Loss per Share schedule of earn

Loss per Share schedule of earnings per share diluted (Details) - USD ($)	3 Months Ended		6 Months Ended
	Mar. 31, 2017	Mar. 31, 2016	Mar. 31, 2017	Mar. 31, 2016
Earnings Per Share, Diluted, by Common Class, Including Two Class Method [Line Items]
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount			623,587	670,300
Net Income (Loss) Attributable to Parent	$ (1,903,101)	$ (7,658,300)	$ (3,205,110)	$ (8,635,508)
Weighted Average Number of Shares Outstanding, Basic	9,348,388	9,341,038	9,348,388	9,335,880
Incremental Common Shares Attributable to Call Options and Warrants	0	0	0	0
Incremental Common Shares Attributable to Share-based Payment Arrangements	0	0	0	0
Weighted Average Number of Shares Outstanding, Diluted	9,348,388	9,341,038	9,348,388	9,335,880
Earnings Per Share, Diluted	$ (0.20)	$ (0.82)	$ (0.34)	$ (0.92)

Accumulated Other Comprehensi27

Accumulated Other Comprehensive Loss (Details) - USD ($)	Mar. 31, 2017	Sep. 30, 2016
Comprehensive Loss [Abstract]
Accumulated Other Comprehensive Income (Loss), Foreign Currency Translation Adjustment, Net of Tax	$ (252,546)	$ (528,716)
Available-for-sale Securities, Accumulated Gross Unrealized Loss, before Tax	(584)	(135)
Accumulated Other Comprehensive Income (Loss), Net of Tax	$ (253,130)	$ (528,851)

Goodwill and Intangible Asset28

Goodwill and Intangible Assets (Details) - USD ($)	3 Months Ended		6 Months Ended
	Mar. 31, 2017	Mar. 31, 2016	Mar. 31, 2017	Mar. 31, 2016	Sep. 30, 2016
Finite-Lived Intangible Assets [Line Items]
Finite-Lived Customer Relationships, Gross	$ 910,000		$ 910,000		$ 910,000
finite lived customer relationships, accumulated amortization	483,833		483,833		371,833
Finite-Lived Trade Names, Gross	660,000		660,000		660,000
finite lived tradenames, accumulated amortization	113,667		113,667		91,667
Finite-Lived Intangible Assets, Gross	1,570,000		1,570,000		1,570,000
Finite-Lived Intangible Assets, Accumulated Amortization	597,500		597,500		$ 463,500
Finite-Lived Intangible Assets, Amortization Expense, Next Twelve Months	134,000		134,000
Amortization of Intangible Assets	67,000	$ 129,250	134,000	$ 258,500
Finite-Lived Intangible Assets, Amortization Expense, Year Two	177,000		177,000
Finite-Lived Intangible Assets, Amortization Expense, Year Three	123,000		123,000
Finite-Lived Intangible Assets, Amortization Expense, Year Four	91,000		91,000
Finite-Lived Intangible Assets, Amortization Expense, Year Five	72,000		72,000
Finite-Lived Intangible Assets, Amortization Expense, Rolling after Year Five	$ 375,500		$ 375,500

Stock Based Compensation (Detai

Stock Based Compensation (Details) - USD ($)	3 Months Ended		6 Months Ended
	Mar. 31, 2017	Mar. 31, 2016	Mar. 31, 2017	Mar. 31, 2016
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based Compensation	$ 11,395	$ 145,580	$ 23,794	$ 298,778
Share Based Compensation per share	$ 0	$ 0.02	$ 0	$ 0.03

Income Taxes (Details)

Income Taxes (Details) $ in Millions	Sep. 30, 2016USD ($)
Valuation Allowance [Line Items]
Deferred tax assets net of liabilities before valuation allowance	$ 13.4
Deferred Tax Assets, Operating Loss Carryforwards	$ 8.8

Product Warranties (Details)

Product Warranties (Details) - USD ($)	3 Months Ended		6 Months Ended
	Mar. 31, 2017	Mar. 31, 2016	Mar. 31, 2017	Mar. 31, 2016	Dec. 31, 2016	Sep. 30, 2016	Dec. 31, 2015	Sep. 30, 2015
Product Warranties [Abstract]
Balance at beginning of period	$ 650,000	$ 650,000	$ 650,000	$ 650,000	$ 650,000	$ 650,000	$ 650,000	$ 650,000
Provision for warranties	102,000	110,000	216,000	218,000
Expenses incurred	$ (102,000)	$ (110,000)	$ (216,000)	$ (218,000)