Document_and_Entity_Informatio
Document and Entity Information | 9 Months Ended | |
Mar. 31, 2014 | 9-May-14 | |
Document And Entity Information | ' | ' |
Entity Registrant Name | 'PARK CITY GROUP INC | ' |
Entity Central Index Key | '0000050471 | ' |
Document Type | '10-Q | ' |
Document Period End Date | 31-Mar-14 | ' |
Amendment Flag | 'false | ' |
Current Fiscal Year End Date | '--06-30 | ' |
Is Entity a Well-known Seasoned Issuer? | 'No | ' |
Is Entity a Voluntary Filer? | 'No | ' |
Is Entity's Reporting Status Current? | 'Yes | ' |
Entity Filer Category | 'Smaller Reporting Company | ' |
Entity Common Stock, Shares Outstanding | ' | 16,919,072 |
Document Fiscal Period Focus | 'Q3 | ' |
Document Fiscal Year Focus | '2014 | ' |
Condensed_Consolidated_Balance
Condensed Consolidated Balance Sheets (USD $) | Mar. 31, 2014 | Jun. 30, 2013 |
Current assets: | ' | ' |
Cash | $3,411,181 | $3,616,585 |
Receivables, net of allowance of $70,000 and $190,000 at March 31, 2014 and June 30, 2013, respectively | 3,018,850 | 2,383,366 |
Prepaid expenses and other current assets | 272,133 | 403,909 |
Total current assets | 6,702,164 | 6,403,860 |
Property and equipment, net | 814,649 | 671,959 |
Other assets: | ' | ' |
Deposits and other assets | 14,866 | 14,866 |
Note receivable | 2,543,406 | 1,622,863 |
Customer relationships | 2,023,598 | 2,340,335 |
Goodwill | 4,805,933 | 4,805,933 |
Capitalized software costs, net | ' | 73,082 |
Total other assets | 9,387,803 | 8,857,079 |
Total assets | 16,904,616 | 15,932,898 |
Current liabilities: | ' | ' |
Accounts payable | 737,498 | 653,655 |
Accrued liabilities | 1,402,445 | 1,096,982 |
Deferred revenue | 1,542,532 | 1,777,326 |
Lines of credit | 1,200,000 | 1,200,000 |
Notes payable | 246,039 | 551,421 |
Total current liabilities | 5,128,514 | 5,279,384 |
Long-term liabilities: | ' | ' |
Notes payable, less current portion | 512,783 | 310,642 |
Other long-term liabilities | 97,988 | 101,500 |
Total liabilities | 5,739,285 | 5,691,526 |
Stockholders' equity: | ' | ' |
Series B Convertible Preferred Stock, $0.01 par value, 30,000,000 shares authorized; 411,927 shares issued and outstanding at March 31, 2014 and June 30, 2013, respectively | 4,119 | 4,119 |
Common Stock, $0.01 par value, 50,000,000 shares authorized; 16,910,009 and 16,128,530 shares issued and outstanding at March 31, 2014 and June 30, 2013, respectively | 169,100 | 161,285 |
Additional paid-in capital | 46,698,419 | 43,314,986 |
Accumulated deficit | -35,706,307 | -33,239,018 |
Total stockholders' equity | 11,165,331 | 10,241,372 |
Total liabilities and stockholders' equity | $16,904,616 | $15,932,898 |
Condensed_Consolidated_Balance1
Condensed Consolidated Balance Sheets (Parenthetical) (USD $) | Mar. 31, 2014 | Jun. 30, 2013 |
Current assets: | ' | ' |
Receivables, net of allowance | $70,000 | $190,000 |
Stockholders' equity: | ' | ' |
Series B Convertible Preferred stock, par value | $0.01 | $0.01 |
Series B Convertible Preferred stock, Authorized | 30,000,000 | 30,000,000 |
Series B Convertible Preferred stock, Issued | 411,927 | 411,927 |
Series B Convertible Preferred stock, outstanding | 411,927 | 411,927 |
Common stock, par value | $0.01 | $0.01 |
Common stock, Authorized | 50,000,000 | 50,000,000 |
Common stock, Issued | 16,910,009 | 16,128,530 |
Common stock, outstanding | 16,910,009 | 16,128,530 |
Condensed_Consolidated_Stateme
Condensed Consolidated Statements of Operations (Unaudited) (USD $) | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2014 | Mar. 31, 2013 | Mar. 31, 2014 | Mar. 31, 2013 | |
Revenues: | ' | ' | ' | ' |
Subscription | $2,489,772 | $2,007,821 | $6,968,606 | $5,917,978 |
Other revenue | 598,725 | 1,039,167 | 1,915,441 | 2,500,739 |
Total revenues | 3,088,497 | 3,046,988 | 8,884,047 | 8,418,717 |
Operating expenses: | ' | ' | ' | ' |
Cost of services and product support | 1,336,818 | 1,141,643 | 3,792,364 | 3,321,290 |
Sales and marketing | 1,073,200 | 747,120 | 3,442,675 | 2,090,777 |
General and administrative | 905,225 | 692,548 | 3,032,842 | 1,862,049 |
Depreciation and amortization | 211,661 | 222,602 | 679,963 | 683,125 |
Total operating expenses | 3,526,904 | 2,803,913 | 10,947,844 | 7,957,241 |
(Loss) income from operations | -438,407 | 243,075 | -2,063,797 | 461,476 |
Other expense: | ' | ' | ' | ' |
Interest income (expense) | 31,987 | -33,781 | 59,927 | -111,649 |
(Loss) income before income taxes | -406,420 | 209,294 | -2,003,870 | 349,827 |
(Provision) benefit for income taxes | ' | ' | ' | ' |
Net (loss) income | -406,420 | 209,294 | -2,003,870 | 349,827 |
Dividends on preferred stock | -154,473 | -288,721 | -463,419 | -788,002 |
Net (loss) applicable to common shareholders | ($560,893) | ($79,427) | ($2,467,289) | ($438,175) |
Weighted average shares, basic and diluted | 16,867,000 | 12,750,000 | 16,640,000 | 12,420,000 |
Basic and diluted loss per share | ($0.03) | ($0.01) | ($0.15) | ($0.04) |
Condensed_Consolidated_Stateme1
Condensed Consolidated Statements of Cash Flows (Unaudited) (USD $) | 9 Months Ended | |
Mar. 31, 2014 | Mar. 31, 2013 | |
Cash Flows From Operating Activities: | ' | ' |
Net (loss) income | ($2,003,870) | $349,827 |
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | ' | ' |
Depreciation and Amortization | 679,963 | 683,125 |
Stock issued for charitable contribution | 96,900 | ' |
Stock compensation expense | 1,323,984 | 662,463 |
Bad debt expense | 171,692 | 81,260 |
(Increase) decrease in: | ' | ' |
Receivables | -807,176 | -923,078 |
Prepaids and other assets | 11,233 | -165,809 |
(Decrease) increase in: | ' | ' |
Accounts payable | 83,843 | 75,067 |
Accrued liabilities | -33,801 | 8,359 |
Deferred revenue | -234,794 | -510,735 |
Net cash (used in) provided by operating activities | -712,026 | 260,479 |
Cash Flows From Investing Activities: | ' | ' |
Cash from sales of property and equipment | 6,505 | ' |
Cash advanced on note receivable | -800,000 | ' |
Purchase of property and equipment | -439,339 | -345,375 |
Net cash used in investing activities | -1,232,834 | -345,375 |
Cash Flows From Financing Activities: | ' | ' |
Proceeds from issuance of stock | 1,493,838 | 4,054,921 |
Proceeds from exercise of options and warrants | 627,529 | ' |
Proceeds from employee stock plans | 153,874 | 156,742 |
Proceeds from issuance of note payable | 338,287 | 176,797 |
Dividends paid | -432,524 | -370,734 |
Payments on notes payable | -441,528 | -643,102 |
Net cash provided by financing activities | 1,739,456 | 3,374,624 |
Net (decrease) increase in cash | -205,404 | 3,289,728 |
Cash at beginning of period | 3,616,585 | 1,106,176 |
Cash at end of period | 3,411,181 | 4,395,904 |
Supplemental Disclosure of Cash Flow Information: | ' | ' |
Cash paid for income taxes | 6,634 | ' |
Cash paid for interest | 64,738 | 112,806 |
Supplemental Disclosure of Non-Cash Investing and Financing Activities: | ' | ' |
Common stock to pay accrued liabilities | 1,004,127 | 846,513 |
Dividends accrued on preferred stock | 463,419 | 788,002 |
Dividends paid with preferred stock | ' | $501,060 |
DESCRIPTION_OF_BUSINESS_AND_ME
DESCRIPTION OF BUSINESS AND MERGER OF PRESCIENT APPLIED INTELLIGENCE, INC. | 9 Months Ended |
Mar. 31, 2014 | |
Notes to Financial Statements | ' |
NOTE 1. DESCRIPTION OF BUSINESS AND MERGER OF PRESCIENT APPLIED INTELLIGENCE, INC. | ' |
Summary of Business | |
Park City Group, Inc. (the “Company”) is incorporated in the state of Nevada. The Company’s 98.76% and 100% owned subsidiaries, PC Group, Inc. and Park City Group, Inc. (“Prescient”), respectively, are incorporated in the states of Utah and Delaware, respectively. All intercompany transactions and balances have been eliminated in consolidation. | |
The Company designs, develops, markets and supports proprietary software products. These products are designed for businesses having multiple locations to assist in the management of business operations on a daily basis and communicate results of operations in a timely manner. In addition, the Company has built a consulting practice for business improvement that centers on the Company’s proprietary software products. The principal markets for the Company's products are multi-store retail and convenience store chains, branded food manufacturers, suppliers and distributors, and manufacturing companies, which have operations in North America, Europe, Asia and the Pacific Rim. | |
SIGNIFICANT_ACCOUNTING_POLICIE
SIGNIFICANT ACCOUNTING POLICIES | 9 Months Ended |
Mar. 31, 2014 | |
Significant Accounting Policies | ' |
NOTE 2. SIGNIFICANT ACCOUNTING POLICIES | ' |
Basis of Presentation | |
The accompanying unaudited consolidated condensed financial statements of the Company have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission ("SEC") on a basis consistent with the Company’s audited annual financial statements and, in the opinion of management, reflect all adjustments, consisting only of normal recurring adjustments, necessary to present fairly the financial information set forth therein. Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. generally accepted accounting principles have been condensed or omitted pursuant to SEC rules and regulations, although the Company believes that the following disclosures, when read in conjunction with the audited annual financial statements and the notes thereto included in the Company’s most recent Annual Report on Form 10−K, are adequate to make the information presented not misleading. Operating results for the three and nine months ended March 31, 2014 are not necessarily indicative of the operating results that may be expected for the fiscal year ending June 30, 2014. | |
Recent Accounting Pronouncements | |
In January 2013, the FASB issued ASU 2013-01, Balance Sheet (Topic 210) – Clarifying the Scope of Disclosures about Offsetting Assets and Liabilities. The main purpose of this Update is to clarify that the disclosures regarding offsetting assets and liabilities per ASU 2011-11 apply to derivatives including embedded derivatives, repurchase agreements and reverse repurchase agreements and securities borrowing and lending transactions that are offset or subject to a master netting agreement. Other types of transactions are not impacted. This Update is effective for fiscal years beginning on or after January 1, 2013 and for all interim periods within that fiscal year. The Company doesn’t expect this Update to impact the Company’s financials since it does not have instruments noted in the Update that are offset. | |
In July 2012, the FASB issued ASU 2012-02, Intangibles—Goodwill and Other (Topic 350)—Testing Indefinite-Lived Intangible Assets for Impairment, to allow entities to use a qualitative approach to test indefinite-lived intangible assets for impairment. ASU 2012-02 permits an entity to first perform a qualitative assessment to determine whether it is more likely than not that the fair value of an indefinite-lived intangible asset is less than its carrying value. If it is concluded that this is the case, it is necessary to perform the currently prescribed quantitative impairment test by comparing the fair value of the indefinite-lived intangible asset with its carrying value. Otherwise, the quantitative impairment test is not required. The Company has adopted ASU 2012-02 for fiscal 2014 and does not believe that the adoption will have a material effect on the consolidated financial statements. | |
Use of Estimates in the Preparation of Financial Statements | |
The preparation of consolidated financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that materially affect the amounts reported in the consolidated financial statements. Actual results could differ from these estimates. The methods, estimates and judgments the Company uses in applying its most critical accounting policies have a significant impact on the results it reports in its financial statements. The SEC has defined the most critical accounting policies as those that are most important to the portrayal of the Company’s financial condition and results, and require the Company to make its most difficult and subjective judgments, often as a result of the need to make estimates of matters that are inherently uncertain. Based on this definition, the Company’s most critical accounting policies include: income taxes, goodwill and other long-lived asset valuations, revenue recognition, stock-based compensation, and capitalization of software development costs. | |
Receivables | |
Trade account and notes receivable are stated at the amount the Company expects to collect. Receivables are reviewed individually for collectability. If the financial condition of the Company’s customers were to deteriorate, adversely affecting their ability to make payments, allowances may be required. Interest income on current notes receivable is recognized on an accrual basis at a stated interest rate of 8%. | |
Allowance for Doubtful Accounts Receivable | |
The Company offers credit terms on the sale of the Company’s products to a significant majority of the Company’s customers and requires no collateral from these customers. The Company performs ongoing credit evaluations of customers’ financial condition and maintains an allowance for doubtful accounts receivable based upon the Company’s historical experience and a specific review of accounts receivable at the end of each period. As of March 31, 2014 and June 30, 2013, the allowance for doubtful accounts was $70,000 and $190,000, respectively. | |
Net Income and Income Per Common Share | |
Basic net income or loss per common share ("Basic EPS") excludes dilution and is computed by dividing net income or loss by the weighted average number of common shares outstanding during the period. Diluted net income or loss per common share ("Diluted EPS") reflects the potential dilution that could occur if stock options or other contracts to issue shares of common stock were exercised or converted into common stock. The computation of Diluted EPS does not assume exercise or conversion of securities that would have an anti-dilutive effect on net income (loss) per common share. | |
For the three and nine months ended March 31, 2014 and 2013, warrants to purchase 320,154 and 486,110 shares of common stock were not included in the computation of diluted EPS due to the anti-dilutive effect. For the three and nine months ended March 31, 2014, 1,029,818 shares of common stock issuable upon conversion of the Company’s Series B Convertible Preferred Stock (“Series B Preferred”) were not included in the diluted EPS calculation as the effect would have been anti-dilutive, as compared to the 1,029,818 and 3,298,348 shares of common stock issuable upon conversion of the Company’s Series A Convertible Preferred Stock (“Series A Preferred”) and Series B Preferred for the three and nine months ended March 31, 2013. The Company redeemed all outstanding shares of Series A Preferred on April 15, 2013, after which there were no shares of Series A Preferred outstanding. | |
Certain prior-year amounts have been reclassified to conform with the current year's presentation. |
LIQUIDITY
LIQUIDITY | 9 Months Ended |
Mar. 31, 2014 | |
Liquidity | ' |
NOTE 3. LIQUIDITY | ' |
Historically, the Company has financed its operations through operating revenues, loans from directors, officers and stockholders, loans from the Chief Executive Officer and majority shareholder, and private placements of equity securities. | |
At March 31, 2014, the Company had positive working capital of $1,573,650 compared with positive working capital of $1,124,476 at June 30, 2013. This $449,174 increase in working capital is principally due to increased accounts receivable and reductions in deferred revenue and current notes payable. These were partially offset by an increase in accrued liabilities and accounts payable and decrease in prepaid expenses. While no assurances can be given, management currently believes that the Company will continue to increase its working capital position, and thereby reduce its indebtedness in subsequent periods utilizing existing cash resources and projected cash flow from operations. In addition, management may also pay down, pay off, or refinance certain of the Company’s indebtedness to extend the maturities of such indebtedness. Management believes that these initiatives will enable us to address our debt service requirements during the next twelve months without negatively impacting our working capital. The financial statements do not reflect any adjustments should cash flow from operations be insufficient to meet our spending and debt service requirements, and we are otherwise unable to refinance or restructure our indebtedness. | |
On September 4, 2012, the Company announced that its Board of Directors had approved a share repurchase program (the "Repurchase Program") of up to $2.0 million of the Company's common stock over the next two years, or such other date, whichever is earlier, when the Repurchase Program is revoked or varied by the Board of Directors. The Repurchase Program does not obligate the Company to acquire any particular number of shares of common stock. The Repurchase Program may be suspended, modified or discontinued at any time at the Company's discretion without prior notice. As of May 12, 2014, the Company had not repurchased any shares of common stock under the Repurchase Program. It is unlikely at this time that the Board of Directors will repurchase any shares under the Repurchase Program through the date of the Repurchase Program’s termination, on August 22, 2014. |
STOCKBASED_COMPENSATION
STOCK-BASED COMPENSATION | 9 Months Ended |
Mar. 31, 2014 | |
Stock-Based Compensation | ' |
Note 4. STOCK-BASED COMPENSATION | ' |
The Company recognizes the cost of employee services received in exchange for awards of equity instruments based on the grant-date fair value of those awards. The Company records compensation expense on a straight-line basis. The fair value of options granted are estimated at the date of grant using a Black-Scholes option pricing model with assumptions for the risk-free interest rate, expected life, volatility, dividend yield and forfeiture rate. |
OUTSTANDING_STOCK_OPTIONS
OUTSTANDING STOCK OPTIONS | 9 Months Ended | ||||||||||||||||||||||
Mar. 31, 2014 | |||||||||||||||||||||||
Outstanding Stock Options | ' | ||||||||||||||||||||||
Note 5. OUTSTANDING STOCK | ' | ||||||||||||||||||||||
The following tables summarize information about warrants outstanding and exercisable at March 31, 2014: | |||||||||||||||||||||||
Warrants | Warrants | ||||||||||||||||||||||
Outstanding | Exercisable | ||||||||||||||||||||||
at March 31, 2014 | at March 31, 2014 | ||||||||||||||||||||||
Range of | Number | Weighted | Weighted | Number | Weighted | ||||||||||||||||||
exercise prices | outstanding at | average | average | exercisable at | average | ||||||||||||||||||
March 31, | remaining | exercise | March 31, | exercise | |||||||||||||||||||
2014 | contractual | price | 2014 | price | |||||||||||||||||||
life (years) | |||||||||||||||||||||||
Warrants | |||||||||||||||||||||||
$ | 3.50 – 3.60 | 243,410 | 3.96 | $ | 3.56 | 243,410 | $ | 3.56 | |||||||||||||||
$ | 6.45 | 76,744 | 4.41 | $ | 6.45 | 76,744 | $ | 6.45 | |||||||||||||||
320,154 | 4.06 | $ | 4.25 | 320,154 | $ | 4.25 | |||||||||||||||||
RELATED_PARTY_TRANSACTIONS
RELATED PARTY TRANSACTIONS | 9 Months Ended |
Mar. 31, 2014 | |
Related Party Transactions [Abstract] | ' |
NOTE 6. RELATED PARTY TRANSACTIONS | ' |
None. |
PROPERTY_AND_EQUIPMENT
PROPERTY AND EQUIPMENT | 9 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Property And Equipment | ' | ||||||||
NOTE 7. PROPERTY AND EQUIPMENT | ' | ||||||||
Property and equipment are stated at cost and consist of the following as of: | |||||||||
31-Mar-14 | June 30, | ||||||||
(unaudited) | 2013 | ||||||||
Computer equipment | $ | 2,879,976 | $ | 2,444,129 | |||||
Furniture and fixtures | 260,574 | 321,281 | |||||||
Leasehold improvements | 231,782 | 231,782 | |||||||
3,372,332 | 2,997,192 | ||||||||
Less accumulated depreciation and amortization | -2,557,683 | -2,325,233 | |||||||
$ | 814,649 | $ | 671,959 | ||||||
CAPITALIZED_SOFTWARE_COSTS
CAPITALIZED SOFTWARE COSTS | 9 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Capitalized Software Costs | ' | ||||||||
NOTE 8. CAPITALIZED SOFTWARE COSTS | ' | ||||||||
Capitalized software costs consist of the following as of: | |||||||||
31-Mar-14 | June 30, | ||||||||
(unaudited) | 2013 | ||||||||
Capitalized software costs | $ | 2,443,128 | $ | 2,443,128 | |||||
Less accumulated amortization | -2,443,128 | -2,370,046 | |||||||
$ | - | $ | 73,082 | ||||||
ACCRUED_LIABILITIES
ACCRUED LIABILITIES | 9 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Accrued Liabilities [Abstract] | ' | ||||||||
NOTE 9. ACCRUED LIABILITIES | ' | ||||||||
Accrued liabilities consist of the following as of: | |||||||||
31-Mar-14 | June 30, | ||||||||
(unaudited) | 2013 | ||||||||
Accrued stock-based compensation | $ | 815,371 | $ | 497,012 | |||||
Accrued compensation | 272,871 | 295,377 | |||||||
Accrued other liabilities | 159,730 | 176,892 | |||||||
Accrued dividends | 154,473 | 123,578 | |||||||
Accrued interest | - | 4,123 | |||||||
$ | 1,402,445 | $ | 1,096,982 | ||||||
PREFERRED_DIVIDENDS
PREFERRED DIVIDENDS | 9 Months Ended |
Mar. 31, 2014 | |
Preferred Dividends | ' |
Note 10. PREFERRED DIVIDENDS | ' |
Holders of Series B Preferred are entitled to a 15.00% annual dividend payable quarterly in cash. The Company's Series B Preferred are held by affiliates of the Company, consisting of the Chief Executive Officer, his spouse, and a director. | |
Holders of Series A Preferred were entitled to a 10.00% annual dividend payable quarterly in either cash or additional Series A Preferred at the option of the Company with fractional shares paid in cash. On March 15, 2013, the Company called for the redemption of 686,210 issued and outstanding shares of Series A Preferred. The Company completed the Series A Preferred Redemption on April 15, 2013. On that date, of the 686,210 shares of Series A Preferred issued and outstanding, 2,172 shares were redeemed for $10.00 per share, or an aggregate total of $21,720, and the remaining 684,038 shares were converted into 3.33 shares of common stock for each share of Series A Preferred redeemed, or an aggregate total of 2,280,149 shares of the Company's common stock. | |
INCOME_TAXES
INCOME TAXES | 9 Months Ended |
Mar. 31, 2014 | |
Income Taxes | ' |
NOTE 11. INCOME TAXES | ' |
The Company and its subsidiaries file income tax returns in the U.S. federal jurisdiction, and various states. With few exceptions, the Company is no longer subject to U.S. federal, state and local income tax examinations by tax authorities for years before 2009. |
SUBSEQUENT_EVENTS
SUBSEQUENT EVENTS | 9 Months Ended |
Mar. 31, 2014 | |
Subsequent Events [Abstract] | ' |
NOTE 12 - SUBSEQUENT EVENTS | ' |
In accordance with the Subsequent Events Topic of the FASB ASC 855, we have evaluated subsequent events through the date of this filing, and have determined that no subsequent events are reasonably likely to impact the financial statements. |
SIGNIFICANT_ACCOUNTING_POLICIE1
SIGNIFICANT ACCOUNTING POLICIES (Policies) | 9 Months Ended |
Mar. 31, 2014 | |
Accounting Policies [Abstract] | ' |
Basis of Presentation | ' |
Basis of Presentation | |
The accompanying unaudited consolidated condensed financial statements of the Company have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission ("SEC") on a basis consistent with the Company’s audited annual financial statements and, in the opinion of management, reflect all adjustments, consisting only of normal recurring adjustments, necessary to present fairly the financial information set forth therein. Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. generally accepted accounting principles have been condensed or omitted pursuant to SEC rules and regulations, although the Company believes that the following disclosures, when read in conjunction with the audited annual financial statements and the notes thereto included in the Company’s most recent Annual Report on Form 10−K, are adequate to make the information presented not misleading. Operating results for the three and nine months ended March 31, 2014 are not necessarily indicative of the operating results that may be expected for the fiscal year ending June 30, 2014. | |
Recent Accounting Pronouncements | ' |
Recent Accounting Pronouncements | |
In January 2013, the FASB issued ASU 2013-01, Balance Sheet (Topic 210) – Clarifying the Scope of Disclosures about Offsetting Assets and Liabilities. The main purpose of this Update is to clarify that the disclosures regarding offsetting assets and liabilities per ASU 2011-11 apply to derivatives including embedded derivatives, repurchase agreements and reverse repurchase agreements and securities borrowing and lending transactions that are offset or subject to a master netting agreement. Other types of transactions are not impacted. This Update is effective for fiscal years beginning on or after January 1, 2013 and for all interim periods within that fiscal year. The Company doesn’t expect this Update to impact the Company’s financials since it does not have instruments noted in the Update that are offset. | |
In July 2012, the FASB issued ASU 2012-02, Intangibles—Goodwill and Other (Topic 350)—Testing Indefinite-Lived Intangible Assets for Impairment, to allow entities to use a qualitative approach to test indefinite-lived intangible assets for impairment. ASU 2012-02 permits an entity to first perform a qualitative assessment to determine whether it is more likely than not that the fair value of an indefinite-lived intangible asset is less than its carrying value. If it is concluded that this is the case, it is necessary to perform the currently prescribed quantitative impairment test by comparing the fair value of the indefinite-lived intangible asset with its carrying value. Otherwise, the quantitative impairment test is not required. The Company has adopted ASU 2012-02 for fiscal 2014 and does not believe that the adoption will have a material effect on the consolidated financial statements. | |
Use of Estimates in the Preparation of Financial Statements | ' |
Use of Estimates in the Preparation of Financial Statements | |
The preparation of consolidated financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that materially affect the amounts reported in the consolidated financial statements. Actual results could differ from these estimates. The methods, estimates and judgments the Company uses in applying its most critical accounting policies have a significant impact on the results it reports in its financial statements. The SEC has defined the most critical accounting policies as those that are most important to the portrayal of the Company’s financial condition and results, and require the Company to make its most difficult and subjective judgments, often as a result of the need to make estimates of matters that are inherently uncertain. Based on this definition, the Company’s most critical accounting policies include: income taxes, goodwill and other long-lived asset valuations, revenue recognition, stock-based compensation, and capitalization of software development costs. | |
Receivables | ' |
Receivables | |
Trade account and notes receivable are stated at the amount the Company expects to collect. Receivables are reviewed individually for collectability. If the financial condition of the Company’s customers were to deteriorate, adversely affecting their ability to make payments, allowances may be required. Interest income on current notes receivable is recognized on an accrual basis at a stated interest rate of 8%. | |
Allowance for Doubtful Accounts Receivable | ' |
Allowance for Doubtful Accounts Receivable | |
The Company offers credit terms on the sale of the Company’s products to a significant majority of the Company’s customers and requires no collateral from these customers. The Company performs ongoing credit evaluations of customers’ financial condition and maintains an allowance for doubtful accounts receivable based upon the Company’s historical experience and a specific review of accounts receivable at the end of each period. As of March 31, 2014 and June 30, 2013, the allowance for doubtful accounts was $70,000 and $190,000, respectively. | |
Net Income and Income Per Common Share | ' |
Net Income and Income Per Common Share | |
Basic net income or loss per common share ("Basic EPS") excludes dilution and is computed by dividing net income or loss by the weighted average number of common shares outstanding during the period. Diluted net income or loss per common share ("Diluted EPS") reflects the potential dilution that could occur if stock options or other contracts to issue shares of common stock were exercised or converted into common stock. The computation of Diluted EPS does not assume exercise or conversion of securities that would have an anti-dilutive effect on net income (loss) per common share. | |
For the three and nine months ended March 31, 2014 and 2013, warrants to purchase 320,154 and 486,110 shares of common stock were not included in the computation of diluted EPS due to the anti-dilutive effect. For the three and nine months ended March 31, 2014, 1,029,818 shares of common stock issuable upon conversion of the Company’s Series B Convertible Preferred Stock (“Series B Preferred”) were not included in the diluted EPS calculation as the effect would have been anti-dilutive, as compared to the 1,029,818 and 3,298,348 shares of common stock issuable upon conversion of the Company’s Series A Convertible Preferred Stock (“Series A Preferred”) and Series B Preferred for the three and nine months ended March 31, 2013. The Company redeemed all outstanding shares of Series A Preferred on April 15, 2013, after which there were no shares of Series A Preferred outstanding. | |
Certain prior-year amounts have been reclassified to conform with the current year's presentation. |
OUTSTANDING_STOCK_OPTIONS_Tabl
OUTSTANDING STOCK OPTIONS (Tables) | 9 Months Ended | ||||||||||||||||||||||
Mar. 31, 2014 | |||||||||||||||||||||||
Outstanding Stock Options | ' | ||||||||||||||||||||||
Fixed stock options and warrants outstanding and exercisable | ' | ||||||||||||||||||||||
Warrants | Warrants | ||||||||||||||||||||||
Outstanding | Exercisable | ||||||||||||||||||||||
at March 31, 2014 | at March 31, 2014 | ||||||||||||||||||||||
Range of | Number | Weighted | Weighted | Number | Weighted | ||||||||||||||||||
exercise prices | outstanding at | average | average | exercisable at | average | ||||||||||||||||||
March 31, | remaining | exercise | March 31, | exercise | |||||||||||||||||||
2014 | contractual | price | 2014 | price | |||||||||||||||||||
life (years) | |||||||||||||||||||||||
Warrants | |||||||||||||||||||||||
$ | 3.50 – 3.60 | 243,410 | 3.96 | $ | 3.56 | 243,410 | $ | 3.56 | |||||||||||||||
$ | 6.45 | 76,744 | 4.41 | $ | 6.45 | 76,744 | $ | 6.45 | |||||||||||||||
320,154 | 4.06 | $ | 4.25 | 320,154 | $ | 4.25 |
PROPERTY_AND_EQUIPMENT_Tables
PROPERTY AND EQUIPMENT (Tables) | 9 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Property And Equipment | ' | ||||||||
Property and equipment | ' | ||||||||
31-Mar-14 | June 30, | ||||||||
(unaudited) | 2013 | ||||||||
Computer equipment | $ | 2,879,976 | $ | 2,444,129 | |||||
Furniture and fixtures | 260,574 | 321,281 | |||||||
Leasehold improvements | 231,782 | 231,782 | |||||||
3,372,332 | 2,997,192 | ||||||||
Less accumulated depreciation and amortization | -2,557,683 | -2,325,233 | |||||||
$ | 814,649 | $ | 671,959 |
CAPITALIZED_SOFTWARE_COSTS_Tab
CAPITALIZED SOFTWARE COSTS (Tables) | 9 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Capitalized Software Costs | ' | ||||||||
Capitalized software costs | ' | ||||||||
31-Mar-14 | June 30, | ||||||||
(unaudited) | 2013 | ||||||||
Capitalized software costs | $ | 2,443,128 | $ | 2,443,128 | |||||
Less accumulated amortization | -2,443,128 | -2,370,046 | |||||||
$ | - | $ | 73,082 |
ACCRUED_LIABILITIES_Tables
ACCRUED LIABILITIES (Tables) | 9 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Accrued Liabilities [Abstract] | ' | ||||||||
Accrued liabilities | ' | ||||||||
31-Mar-14 | June 30, | ||||||||
(unaudited) | 2013 | ||||||||
Accrued stock-based compensation | $ | 815,371 | $ | 497,012 | |||||
Accrued compensation | 272,871 | 295,377 | |||||||
Accrued other liabilities | 159,730 | 176,892 | |||||||
Accrued dividends | 154,473 | 123,578 | |||||||
Accrued interest | - | 4,123 | |||||||
$ | 1,402,445 | $ | 1,096,982 |
DESCRIPTION_OF_BUSINESS_AND_ME1
DESCRIPTION OF BUSINESS AND MERGER OF PRESCIENT APPLIED INTELLIGENCE, INC. (Details Narrative) | 3 Months Ended |
Mar. 31, 2014 | |
Incorporated state | 'State of Nevada |
Subsidiary Park City Group Inc. [Member] | ' |
Incorporated state | 'State of Delaware |
Ownership interest by parent | 98.76% |
Subsidiary Prescient [Member] | ' |
Incorporated state | 'State of Delaware |
Ownership interest by parent | 100.00% |
SIGNIFICANT_ACCOUNTING_POLICIE2
SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) (USD $) | 3 Months Ended | 9 Months Ended | |
Mar. 31, 2014 | Mar. 31, 2013 | Jun. 30, 2013 | |
Accounting Policies [Abstract] | ' | ' | ' |
Computation of diluted EPS due to the anti-dilutive effect shares excluded | 320,154 | 486,110 | ' |
Common stock issuable upon Series A conversion excluded from EPS | 1,029,818 | 3,298,348 | ' |
Current notes receivable accrual basis recognize rate | ' | '.08 | ' |
Allowance for doubtful accounts | $70,000 | ' | $190,000 |
OUTSTANDING_STOCK_OPTIONS_Deta
OUTSTANDING STOCK OPTIONS (Details) (USD $) | 3 Months Ended |
Mar. 31, 2014 | |
Outstanding at End of Period, Shares | 320,154 |
Weighted average remaining contractual life (years), Shares Outstanding | '4 years 0 months 22 days |
Weighted average exercise price, Shares Outstanding | $4.25 |
Exercisable at End of Period, Shares | 320,154 |
Weighted average exercise price, Shares Exercisable | $4.25 |
$3.50 - $3.60 [Member] | ' |
Range of exercise prices | '3.50-3.60 |
Outstanding at End of Period, Shares | 243,410 |
Weighted average remaining contractual life (years), Shares Outstanding | '3 years 11 months 16 days |
Weighted average exercise price, Shares Outstanding | $3.56 |
Exercisable at End of Period, Shares | 243,410 |
Weighted average exercise price, Shares Exercisable | $3.56 |
$6.45 [Member] | ' |
Range of exercise prices | '6.45 |
Outstanding at End of Period, Shares | 76,744 |
Weighted average remaining contractual life (years), Shares Outstanding | '4 years 4 months 28 days |
Weighted average exercise price, Shares Outstanding | $6.45 |
Exercisable at End of Period, Shares | 76,744 |
Weighted average exercise price, Shares Exercisable | $6.45 |
LIQUIDITY_Details_Narrative
LIQUIDITY (Details Narrative) (USD $) | 3 Months Ended | |
Mar. 31, 2014 | Jun. 30, 2013 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ' | ' |
Working Capital | $1,573,650 | $1,124,476 |
Increase in working capital | 449,174 | ' |
Share repurchase program maximum | $2,000,000 | ' |
Share repurchase program term | '2 years | ' |
PROPERTY_AND_EQUIPMENT_Details
PROPERTY AND EQUIPMENT (Details) (USD $) | Mar. 31, 2014 | Jun. 30, 2013 |
Property, Plant and Equipment [Abstract] | ' | ' |
Computer equipment | $2,879,976 | $2,444,129 |
Furniture and fixtures | 260,574 | 321,281 |
Leasehold improvements | 231,782 | 231,782 |
Property and equipment, gross | 3,372,332 | 2,997,192 |
Less accumulated depreciation and amortization | -2,557,683 | -2,325,233 |
Property and equipment, Net | $814,649 | $671,959 |
CAPITALIZED_SOFTWARE_COSTS_Det
CAPITALIZED SOFTWARE COSTS (Details) (USD $) | Mar. 31, 2014 | Jun. 30, 2013 |
Notes to Financial Statements | ' | ' |
Capitalized software costs | $2,443,128 | $2,443,128 |
Less accumulated amortization | -2,443,128 | -2,370,046 |
Capitalized software costs, Net | ' | $73,082 |
ACCRUED_LIABILITIES_Details
ACCRUED LIABILITIES (Details) (USD $) | Mar. 31, 2014 | Jun. 30, 2013 |
Payables and Accruals [Abstract] | ' | ' |
Accrued stock-based compensation | $815,371 | $497,012 |
Accrued compensation | 272,871 | 295,377 |
Accrued other liabilities | 154,473 | 123,578 |
Accrued dividends | 159,730 | 176,892 |
Accrued interest | ' | 4,123 |
Accrued liabilities | $1,402,445 | $1,096,982 |
PREFERRED_DIVIDENDS_Details_Na
PREFERRED DIVIDENDS (Details Narrative) (USD $) | 3 Months Ended |
Mar. 31, 2014 | |
Series A [Member] | ' |
Dividends on Preferred Shares, Percentage | 10.00% |
Shares called for redemption | 686,210 |
Series A Preferred redemption price | $10 |
Shares redeemed for cash | $21,720 |
Called shares converted to common stock | 684,038 |
Preferred redemption completion date | 15-Apr-13 |
Series A conversion rate | '1 for 3.33 |
Aggregate common stock issued upon conversion | 2,280,149 |
Series B [Member] | ' |
Dividends on Preferred Shares, Percentage | 15.00% |