Veritec (VRTC) 10-K 26 Jun 15 2013 FY Annual report Financial data

Document and Entity Information

Document and Entity Information - USD ($)	12 Months Ended
	Jun. 30, 2013	Dec. 31, 2012
Document And Entity Information
Entity Registrant Name	VERITEC INC
Entity Central Index Key	773,318
Document Type	10-K
Document Period End Date	Jun. 30, 2013
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?	No
Entity Filer Category	Smaller Reporting Company
Entity Public Float		$ 467,996
Entity Common Stock, Shares Outstanding	15,920,088
Document Fiscal Period Focus	FY
Document Fiscal Year Focus	2,013

Consolidated Balance Sheets (Un

Consolidated Balance Sheets (Unaudited) - USD ($)	Jun. 30, 2013	Jun. 30, 2012
Current Assets:
Cash	$ 75,918	$ 62,115
Accounts receivables, net of allowance of $13,151 and $12,604 respectively	288,323	11,133
Inventories	4,815	3,603
Prepaid expenses	$ 32,887	4,350
Employee expenses		637
Total Current Assets	$ 401,943	81,838
Restricted cash	$ 499,277	500,000
Property and Equipment, net		644
Total Assets	$ 901,220	582,482
Current Liabilities:
Notes payable - in default	787,153	835,602
Notes payable, related party - in default	2,525,948	2,283,985
Accounts payable	497,518	584,109
Accounts payable, related party	82,129	43,306
Customer deposits	1,097,962	469,114
Payroll tax liabilities	680,461	521,568
Accrued expenses	143,310	128,135
Total Current Liabilities	5,814,481	4,865,819
Stockholders' Deficiency:
Convertible preferred stock, par value $1.00; authorized 10,000,000 shares, 276,000 shares of Series H authorized, 1,000 shares issued and outstanding as of June 30, 2013 and 2012	1,000	1,000
Common stock, par value $.01; authorized 50,000,000 shares, 15,920,088 shares issued and outstanding as of 30, 2013 and 2012	159,201	$ 159,201
Common stock to be issued, 50,000 shares and no shares, respectively	10,477
Additional paid-in capital	14,594,181	$ 14,413,010
Accumulated deficit	(19,678,120)	(18,856,548)
Total Stockholders' Deficiency	(4,913,261)	(4,283,337)
Total Liabilities and Stockholders' Deficiency	$ 901,220	$ 582,482

Consolidated Balance Sheets (Pa

Consolidated Balance Sheets (Parenthetical) - USD ($)	Jun. 30, 2013	Jun. 30, 2012
Allowance for Doubtful Accounts	$ 13,151	$ 12,604
Convertible preferred stock, par value	$ 1	$ 1
Convertible preferred stock, shares authorized	10,000,000	10,000,000
Convertible preferred stock, shares issued	1,000	1,000
Convertible preferred stock, shares outstanding	1,000	1,000
Common stock, par value	$ .01	$ .01
Common stock, shares authorized	50,000,000	50,000,000
Common stock, shares issued	15,920,088	15,920,088
Common stock, shares outstanding	15,920,088	15,920,088
Common stock, shares to be issued	50,000	0
Series H Convertible
Convertible preferred stock, shares authorized	276,000	276,000
Convertible preferred stock, shares issued	1,000
Convertible preferred stock, shares outstanding	1,000

Consolidated Statements of Oper

Consolidated Statements of Operations (Unaudited) - USD ($)	12 Months Ended
	Jun. 30, 2013	Jun. 30, 2012
Income Statement [Abstract]
License and other revenue	$ 720,172	$ 586,784
Cost of Sales	258,217	244,687
Gross Profit	461,955	342,097
Operating Expenses:
General and administrative	791,315	605,721
Sales and marketing	86,067	144,965
Research and development	128,672	206,748
Total Operating Expenses	1,006,054	957,434
Loss from Operations	(544,099)	(615,337)
Other Expense:
Interest income	2,008	111
Interest expense, including $171,963 and $150,092, respectively to related parties	(279,481)	(231,235)
Total Other Expense	(277,473)	(231,124)
Net Loss	$ (821,572)	$ (846,461)
Net Income (Loss) Per Common Share
Basic	$ (0.05)	$ (0.05)
Diluted	$ (0.05)	$ (0.05)
Weighted Average Number of Shares Outstanding
Basic	15,920,088	15,920,088
Diluted	15,920,088	15,920,088

Consolidated Statements of Ope5

Consolidated Statements of Operations (Parenthetical) - USD ($)	12 Months Ended
	Jun. 30, 2013	Jun. 30, 2012
Income Statement [Abstract]
Interest expense, related parties	$ 171,963	$ 150,092

Consolidated Statements of Stoc

Consolidated Statements of Stockholders' Deficiency - USD ($)	12 Months Ended
	Jun. 30, 2013	Jun. 30, 2012
Preferred Stock
Beginning balance, Shares	1,000	1,000
Beginning balance, Amount	$ 1,000	$ 1,000
Shares issued for services
Stock based compensation
Fair Value of Shareholder Guarantee of Notes Payable
Net (Loss) Income
Ending balance, Shares	1,000	1,000
Ending balance, Amount	$ 1,000	$ 1,000
Common Stock
Beginning balance, Shares	15,920,088	15,920,088
Beginning balance, Amount	$ 159,201	$ 159,201
Shares issued for services
Stock based compensation
Fair Value of Shareholder Guarantee of Notes Payable
Net (Loss) Income
Ending balance, Shares	15,920,088	15,920,088
Ending balance, Amount	$ 159,201	$ 159,201
Common Stock to be Issued
Beginning balance, Amount
Shares issued for services	10,477
Stock based compensation
Fair Value of Shareholder Guarantee of Notes Payable
Net (Loss) Income
Ending balance, Amount	$ 10,477
Additional Paid-In Capital
Beginning balance, Amount	$ 14,413,010	$ 14,283,077
Shares issued for services
Stock based compensation	$ 181,171	2
Fair Value of Shareholder Guarantee of Notes Payable		$ 129,931
Net (Loss) Income
Ending balance, Amount	$ 14,594,181	$ 14,413,010
Retained Earnings / Accumulated Deficit
Beginning balance, Amount	$ (18,856,548)	$ (18,010,087)
Shares issued for services
Stock based compensation
Fair Value of Shareholder Guarantee of Notes Payable
Net (Loss) Income	$ (821,572)	$ (846,461)
Ending balance, Amount	(19,678,120)	(18,856,548)
Beginning balance, Amount	$ (4,283,337)	(3,566,809)
Shares issued for services	10,477
Stock based compensation	$ 181,171
Fair Value of Shareholder Guarantee of Notes Payable		129,931
Net (Loss) Income	(821,572)	(846,461)
Ending balance, Amount	$ (4,913,261)	$ (4,283,337)

Consolidated Statements of Cash

Consolidated Statements of Cash Flows (Unaudited) - USD ($)	12 Months Ended
	Jun. 30, 2013	Jun. 30, 2012
CASH FLOWS FROM OPERATING ACTIVITIES
Net income (loss)	$ (821,572)	$ (846,461)
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities
Depreciation	644	15,824
Allowance on accounts receivable	547	$ 5,454
Shares issued for services	10,477
Fair value of stock options issued to employees	181,171	$ 2
Amortization of discount on notes payable	69,742	60,189
Interest accrued on notes payable	209,734	170,546
Changes in operating assets and liabilities:
Accounts receivable	(277,737)	14,048
Restricted cash	723	(500,000)
Inventories	(12,112)	2,529
Prepaid expenses	$ (27,900)	18,931
Employee advances		2,200
Payroll tax liabilities	$ 158,893	180,940
Customer deposits	628,848	397,572
Accounts payables and accrued expenses	(32,593)	6,680
Net cash provided (used) by operating activities	$ 99,765	(471,546)
CASH FLOWS FROM INVESTING ACTIVITIES
Advances on notes receivable		(11,668)
Net cash used in investing activities		$ (11,668)
CASH FLOWS FROM FINANCING ACTIVITIES
Payment of notes payable	$ (163,962)
Proceeds from notes payable		$ 489,217
Proceeds from notes payable, related party	$ 180,000	46,000
Payments on notes payable, related party	(102,000)	(4,884)
Net cash provided by (used in) financing activities	(85,962)	530,333
NET INCREASE IN CASH	13,803	47,119
CASH AT BEGINNING OF YEAR	62,115	14,996
CASH AT END OF YEAR	$ 75,918	62,115
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
Cash paid for interest		5,383
NON CASH INVESTING AND FINANCING ACTIVITIES
Issuance of secured note payable upon conversion of accounts payable		257,957
Fair value of shareholder guarantee on notes payable recorded as valuation discount		129,931
Notes payable canceled through notes receivable		$ 10,168

Operations and Summary of Signi

Operations and Summary of Significant Accounting Policies	12 Months Ended
	Jun. 30, 2013
Accounting Policies [Abstract]
Operations and Summary of Significant Accounting Policies	NOTE 1 - OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The Company The Company refers to Veritec, Inc. (Veritec) and its wholly owned subsidiaries, Vcode Holdings, Inc. (Vcode®), and Veritec Financial Systems, Inc. (VTFS). Nature of Business The Company is primarily engaged in the development, marketing, sales and licensing of products and rendering of professional services related thereto in the following two fields of technology: (1) proprietary two-dimensional matrix symbology (also commonly referred to as “two-dimensional barcodes” or “2D barcodes”), and (2) mobile banking solutions. The Company’s two-dimensional matrix symbology technology will hereafter be referred to as the Company’s “Barcode Technology”, and the Company’s mobile banking technology will hereafter be referred to as its “Mobile Banking Technology”. The Company’s Barcode Technology was originally invented by the founders of Veritec under United States patents 4,924,078, 5,331,176, 5,612,524 and 7,159,780. Our principal licensed product to date that contains our VeriCode ® Barcode Technology has been a product identification system for identification and tracking of manufactured parts, components and products mostly in the liquid crystal display (LCD) markets. The VeriCode® symbol is a two-dimensional high data density machine-readable symbol that can contain up to approximately 500 bytes of data. The Company’s VSCode® Barcode Technology is a derivative of the VeriCode® symbol with the ability to encrypt a greater amount of data by increasing data density. The VSCode ® is a data storage “container” that offers a high degree of security and which can also be tailored to the application requirements of the user. The VSCode ® symbol can hold any form of binary information that can be digitized, including numbers, letters, images, photos, graphics, and the minutia for biometric information, including fingerprints and facial image data, to the extent of its data storage capacity, that are likewise limited by the resolution of the marking and reading devices employed by the user. VSCode ® is ideal for secure identification documents (such as national identification cards, driver’s licenses, and voter registration cards), financial cards, medical records and other high security applications. In its PhoneCodes™ product platform, Veritec developed software to send, store, display, and read a VeriCode® Barcode Technology symbol on the LCD screen of a mobile phone. With the electronic media that provide the ease of transferring information over the web, Veritec’s PhoneCodes™ technology enables individuals and companies to receive or distribute gift certificates, tickets, coupons, receipts, or engage in banking transactions using the VeriCode ® technology via wireless phone or PDA. On January 12, 2009, Veritec formed VTFS, a Delaware corporation, to bring its Mobile Banking Technology, products and related professional services to market. In May 2009 Veritec was registered by Security First Bank in Visa’s Third Party Registration Program as a Cardholder Independent Sales Organization and Third-Party Servicer. As a Cardholder Independent Sales Organization, Veritec was able to promote and sell Visa branded card programs. As a Third-Party Servicer, Veritec provided back-end cardholder transaction processing services for Visa branded card programs on behalf of Security First Bank. As of October 2010 the Company’s registration with Security First Bank terminated. As of April 2011 the Company signed an ISO and processor agreement with Palm Desert National Bank (which was later assigned to First California Bank) to market and processes the Company’s Visa branded card program on behalf of the bank. First California Bank was sold to Pacific Western Bank and in June 2013 Pacific Western Bank closed its entire debit card division and transferred its contract with VTFS to Central Bank of Kansas City Bank. On February 5 th -19- Our VeriSuite™ card enrollment system was released in July 2009. The VeriSuite™ system The Company has a portfolio of five United States and eight foreign patents. In addition, we have seven U.S. and twenty-eight foreign pending patent applications. Principles of Consolidation The accompanying consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. Intercompany transactions and balances were eliminated in consolidation. Use of Estimates The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that may affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Those estimates and assumptions include estimates for reserves of uncollectible accounts, analysis of impairments of long lived assets, accruals for potential liabilities and assumptions made in valuing stock instruments issued for services. Accounts Receivable The Company sells to domestic and foreign companies and grants uncollateralized credit to customers, but requires deposits on unique orders. Management periodically reviews its accounts receivable and provides an allowance for doubtful accounts after analyzing the age of the receivable, payment history and prior experience with the customer. The estimated loss that management believes is probable is included in the allowance for doubtful accounts. While the ultimate loss may differ, management believes that any additional loss will not have a material impact on the Company's financial position. Due to uncertainties in the settlement process, however, it is at least reasonably possible that management's estimate will change during the near term. Inventories Inventories, consisting of purchased components for resale, are stated at the lower of cost or market, applying the first-in, first-out (FIFO) method. Inventory is net of reserves of $23,900 at both June 30, 2013 and 2012. Property and Equipment Property and equipment are stated at cost less accumulated depreciation. Depreciation is computed using the straight-line method over estimated useful lives of 3 to 7 years. When assets are retired or otherwise disposed, the cost and related accumulated depreciation are removed from the accounts and the resulting gain or loss is recognized. Maintenance and repairs are expensed as incurred; significant renewals and betterments are capitalized. Management regularly reviews property, equipment and other long-lived assets for possible impairment. This review occurs quarterly, or more frequently if events or changes in circumstances indicate the carrying amount of the asset may not be recoverable. If there is indication of impairment, management prepares an estimate of future cash flows (undiscounted and without interest charges) expected to result from the use of the asset and its eventual disposition. If these cash flows are less than the carrying amount of the asset, an impairment loss is recognized to write down the asset to its estimated fair value. Based upon management’s assessment, there were no indicators of impairment at June 30, 2013 or 2012. Concentrations The Company’s cash balances on deposit with banks are guaranteed by the Federal Deposit Insurance Corporation up to $250,000. The Company may be exposed to risk for the amounts of funds held in one bank in excess of the insurance limit. In assessing the risk, the Company’s policy is to maintain cash balances with high quality financial institutions. The Company had cash balance in excess of the guarantee during the year ended June 30, 2013. -20- Major Customers: Customers in excess of 10% of total revenues were as follows: Years Ended June 30, 2013 2012 Customer A 18 % 19 % Customer B 11 % 12 % Customer C 31 % 6 % Customer D 12 % - % Customer E - % 23 % Customer F - % 11 % 72 % 71 % As of June 30, 2013, the Company had approximately 250,000 (83%) and $26,563 (9%), respectively, of accounts receivable due from its major customers. As of June 30, 2012, the Company had $6,050 (25%) and $10,025 (42%), respectively, of accounts receivable due from its major customers. Foreign Revenues Foreign revenues accounted for 96% of the Company’s total revenues in fiscal 2013 and 56% in fiscal 2012. (21% Taiwan, 70% Korea, and 5% others in fiscal 2013 and 10% Taiwan, 41% Korea, and 5% others in fiscal 2012.) Fair Value of Financial Instruments Fair Value Measurements are adopted by the Company based on the authoritative guidance provided by the Financial Accounting Standards Board, with the exception of the application of the statement to non-recurring, non-financial assets and liabilities as permitted. The adoption based on the authoritative guidance provided by the Financial Accounting Standards Board did not have a material impact on the Company's fair value measurements. Based on the authoritative guidance provided by the Financial Accounting Standards Board defines fair value as the price that would be received to sell an asset or paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants at the measurement date. FASB authoritative guidance establishes a fair value hierarchy, which prioritizes the inputs used in measuring fair value into three broad levels as follows: Level 1 - Quoted prices in active markets for identical assets or liabilities. Level 2 - Inputs, other than the quoted prices in active markets that are observable either directly or indirectly. Level 3 - Unobservable inputs based on the Company's assumptions. The Company had no such assets or liabilities recorded to be valued on the basis above at June 30, 2013 or 2012. For certain financial instruments, the carrying amounts reported in the consolidated balance sheets for cash and cash equivalents, accounts receivable, and current liabilities, including notes payable and convertible notes, each qualify as financial instruments and are a reasonable estimate of their fair values because of the short period of time between the origination of such instruments and their expected realization and their current market rates of interest. Revenue Recognition The Company accounts for revenue recognition in accordance with guidance of the Financial Accounting Standards Board. Revenues for the Company are classified into four separate products: license revenue (Veritec’s Multi-Dimensional matrix symbology), hardware revenue, identification card revenue, and debit card revenue. Revenues from licenses, hardware, and identification cards are recognized when the product is shipped, the Company no longer has any service or other continuing obligations, and collection is reasonably assured. The process typically begins for license and hardware revenue with a customer purchase order detailing its hardware specifications so the Company can import its software into the customer's hardware. Once importation is completed, -21- if the customer only wishes to purchase a license, the Company typically transmits the software to the customer via the Internet. Revenue is recognized at that point. If the customer requests both license and hardware products, once the software is imported into the hardware and the process is complete, the product is shipped and revenue is recognized at time of shipment. Once the software and/or hardware are either shipped or transmitted, the customers do not have a right of refusal or return. Under some conditions, the customers remit payment prior to the Company having completed importation of the software. In these instances, the Company delays revenue recognition and reflects the prepayments as customer deposits. The process for identification cards begins when a customer requests, via the Internet, an identification card. The card is reviewed for design and placement of the data, printed and packaged for shipment. At the time the identification cards are shipped and collection is reasonably assured, revenue is recognized. The Company, as a processor and a distributor, recognizes revenue from transaction fees charged to cardholders for the use of its issued mobile debit cards. The fees are recognized on a monthly basis after all cardholder transactions have been summarized and reconciled with third party processors. Shipping and Handling Fees and Costs For the years ended June 30, 2013 and 2012, shipping and handling fees billed to customers of $1,816 and $3,156, respectively were included in revenues and shipping and handling costs of $1,675 and $2,988, respectively were included in cost of sales. Research and Development Research and development costs were expensed as incurred. Loss per Common Share Basic earnings (loss) per share are computed by dividing the net income (loss) applicable to Common Stockholders by the weighted average number of shares of Common Stock outstanding during the year. Diluted earnings (loss) per share is computed by dividing the net income (loss) applicable to Common Stockholders by the weighted average number of common shares outstanding plus the number of additional common shares that would have been outstanding if all dilutive potential common shares had been issued, using the treasury stock method. Potential common shares are excluded from the computation as their effect is antidilutive. For the years ended June 30, 2013 and 2012, the calculations of basic and diluted loss per share are the same because potential dilutive securities would have an anti-dilutive effect. The potentially dilutive securities consisted of the following as of: June 30, 2013 2012 Warrants 275,000 275,000 Series H Preferred Stock 10,000 10,000 Convertible Notes Payable 8,146,039 6,382,758 Options 3,165,583 754,249 Total 11,596,622 7,422,007 Stock-Based Compensation The Company periodically issues stock options and warrants to employees and non-employees in capital raising transactions, for services and for financing costs. Stock-based compensation for employees are measured at the grant date, based on the fair value of the award, and is recognized as expense over the requisite service period. Options vest and expire according to terms established at the grant date. The value of the stock compensation to non-employees is based upon the measurement date as determined at either a) the date at which a performance commitment is reached, or b) at the date at which the necessary performance to earn the equity instruments is complete. -22- Income Taxes Current income tax expense is the amount of income taxes expected to be payable for the current year. A deferred income tax asset or liability is established for the expected future consequences of temporary differences in the financial reporting and tax bases of assets and liabilities. The Company considers future taxable income and ongoing, prudent and feasible tax planning strategies, in assessing the value of its deferred tax assets. If the Company determines that it is more likely than not that these assets will not be realized, the Company will reduce the value of these assets to their expected realizable value, thereby decreasing net income. Evaluating the value of these assets is necessarily based on the Company’s judgment. If the Company subsequently determined that the deferred tax assets, which had been written down, would be realized in the future, the value of the deferred tax assets would be increased, thereby increasing net income in the period when that determination was made. Recently Issued Accounting Standards On May 28, 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update No. 2014-09 (ASU 2014-09), Revenue from Contracts with Customers In April 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update No. 2014-08 (ASU 2014-08), Presentation of Financial Statements (Topic 205) and Property, Plant and Equipment (Topic 360) In August 2014, the FASB issued Accounting Standards Update No. 2014-15 (ASU 2014-15), Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern, which provides guidance on determining when and how to disclose going-concern uncertainties in the financial statements. The new standard requires management to perform interim and annual assessments of an entity’s ability to continue as a going concern within one year of the date the financial statements are issued. An entity must provide certain disclosures if conditions or events raise substantial doubt about the entity’s ability to continue as a going concern. The ASU applies to all entities and is effective for annual periods ending after December 15, 2016, and interim periods thereafter, with early adoption permitted. Other recent accounting pronouncements issued by the FASB (including its Emerging Issues Task Force), the AICPA, and the Securities Exchange Commission (the "SEC") did not or are not believed by management to have a material impact on the Company's present or future financial statements.

Going Concern

Going Concern	12 Months Ended
	Jun. 30, 2013
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Going Concern	NOTE 2 - GOING CONCERN The accompanying consolidated financial statements have been prepared assuming the Company will continue as a going concern. At June 30, 2013, the Company had a working capital deficit of $5,412,538 and a stockholders’ deficiency of $4,913,261. The Company is in default of $3,313,101 of its note payable obligations and is also delinquent in payment of certain amounts due of $680,461 for payroll taxes and accrued interest and penalties as of June 30, 2013. As a result, the Company's independent registered public accounting firm, in its report on the Company's June 30, 2013 consolidated financial statements, has raised substantial doubt about the Company's ability to continue as a going concern. The financial statements do not include any adjustments that might be necessary should the Company be unable to continue as a going concern. The Company believes it will require additional funds to continue its operations through fiscal 2014 and beyond and to continue to develop its existing projects and plans to raise such funds by finding additional investors to purchase the Company’s securities, generating sufficient sales revenue, implementing dramatic cost reductions or any combination thereof. There is no assurance that the Company can be successful in raising such funds, generating the necessary sales or reducing major costs. Further, if the Company is successful in raising such funds from sales of equity securities, the terms of these sales may cause significant dilution to existing holders of common stock. The consolidated financial statements do not include any adjustments that may result from this uncertainty. The Company has relied on The Matthews Group, LLC (TMG), a related party owned 50% by Van Tran, the Company’s CEO/Executive Chair and a director, and 50% by Larry Johanns, a significant stockholder of the Company, for funding. Through June 2013, TMG, executives, and some individuals have funded $68,500 mostly in the form of convertible notes payable. During fiscal year 2013, TMG and some individuals funded $180,000, mostly in the form of convertible notes payable.

Restricted Cash

Restricted Cash	12 Months Ended
	Jun. 30, 2013
Accounting Policies [Abstract]
Restricted Cash	NOTE 3 – RESTRICTED CASH The Company entered into Store Value Prepaid Card Sponsorship Agreements (the “Agreement”) with certain banks whereas the Company markets and sells store value prepaid card programs (the “Programs”). The Programs are marketed and managed daily at the direction of the Bank, for which the company receives a transaction fee. In connection with the agreements the Company is required to establish a Reserve Account controlled by the bank. At June 30, 2013 and 2012, the restricted cash totaled $499,277 and $500,000, respectively. Since this amount is restricted for the purposes related to the Programs, it is classified as restricted cash on the consolidated balance sheet.

Property and Equipment

Property and Equipment	12 Months Ended
	Jun. 30, 2013
Property, Plant and Equipment [Abstract]
Property and Equipment	NOTE 4 - PROPERTY AND EQUIPMENT Property and equipment consists of the following as of: June 30, 2013 2012 Furniture and equipment $ 139,083 $ 139,083 Software 73,000 73,000 Vehicles 23,301 23,301 235,384 235,384 Less accumulated depreciation 235,384 234,740 $ — $ 644 Depreciation expense for the years ended June 30, 2013 and 2012 was $644 and $15,824, respectively.

Related Party Transactions

Related Party Transactions	12 Months Ended
	Jun. 30, 2013
Related Party Transactions [Abstract]
Related Party Transactions	NOTES 5 – RELATED PARTY TRANSACTIONS During the years ended June 30, 2013 and 2012 the Company received various unsecured, non-interest bearing, due on demand advances from its CEO Ms. Van Tran, a related party. The balances due Ms. Tran as of June 30, 2013 and 2012 were $82,129 and $43,306, respectively. These advances have been classified as accounts payable, related party on the accompanying consolidated balance sheets. The Company has relied on The Matthews Group, LLC (TMG), and a related party owned 50% by Van Tran, the Company’s CEO/Executive Chair and a director, and 50% by Larry Johanns, a significant stockholder of the Company, for funding (see Note 6). The Company also leases its office facilities from Ms. Van Tran (see Note 10).

Notes Payable

Notes Payable	12 Months Ended
	Jun. 30, 2013
Debt Disclosure [Abstract]
Notes Payable	NOTE 6 – NOTES PAYABLE Notes payable consists of the following as of: June 30, 2013 2012 Convertible notes payable (includes $132,920 and $124,921, respectively, to non-related parties), unsecured, interest at 8%, due September 2010 through November 2010. The principal and accrued interest is convertible at a conversion price of $0.30. The principal and interest is due immediately on the event of default or change of control. The notes are currently in default. $ 739,815 $ 695,815 Convertible notes payable to related parties, unsecured, principal and interest are convertible into common stock at $0.30 to $0.33 per share, interest at 8% to 10%, due on demand to November 2010. The notes are currently in default. 1,023,173 871,951 Convertible note payable to related party, secured by the Company’s intellectual property, principal and interest are convertible into common stock at $0.25 per share subject to board of directors’ approval, interest at 8%. The note was due November 2010 and is now in default. 258,871 242,871 Note payable to related party, secured by the Company’s intellectual property, interest at 8% due August 2010 and is now in default. 502,578 471,838 Notes payable to related parties, unsecured, interest at 0% to 8%, due on demand. 134,430 126,430 Note payable, unsecured, interest at 10%. The note was due in January 2010 and is now in default. Notes payable, secured by the Company's certificate of deposit with a financial institution and classified on the balance sheet as restricted cash, interest at 5%, convertible into common stock at $0.08 per share, due on demand 27,167 30,753 25,167 29,293 Convertible note payable, unsecured, principal and interest are convertible into common stock at $0.30 to $0.40 per share subject to board of directors’ approval, interest at 5% to 8%, due January 2011 to March 2013 and is now in default. 23,411 22,110 Notes payable, unsecured, interest at 5%, due January 2013 and now in default. (1) 301,228 444,374 Note payable, secured by the Company's intellectual property, interest at variable rates starting September 1, 2012, due December 2012 and is now in default. 270,150 257,957 Convertible note payable, unsecured, principal and interest are convertible into common stock at $1.00 per share subject to board of directors’ approval, interest at 8%. The note was due November 2009 and is now in default. 1,525 1,523 Total $ 3,313,101 $ 3,189,329 Less valuation discount on notes payable — (69,742 ) Grand total $ 3,313,101 $ 3,119,587 (1) In connection with the issuance of the notes payable, two stockholders of the Company granted the lender the option to acquire 1,600,000 unrestricted shares of the Company’s common stock from the stockholder’s at a price of $0.40 per share. The agreement to provide the lender with the option to purchase shares of the two shareholders was presumed to be a separate arrangement between the Company and the lender. As such, the Company valued the shares as if they had provided the lender an option to acquire these shares. The aggregate value of the 1,600,000 shares was valued at $129,931 using Black-Scholes option valuation model with the following assumptions: expected life, 1 year, risk free interest rate, 0.10%, volatility, 250%, and dividend rate, 0%. The value of the option is being considered as a valuation discount and was amortized over the one year life of the Note. For the year ended June 30, 2013, the Company recognized the remaining $69,742 of expense related to the amortization of this discount and is included in the interest expense in the consolidated statement of operations. For the purposes of Balance Sheet presentation notes payable have been presented as follows: June 30, 2013 2012 Notes payable $ 787,153 $ 835,602 Notes payable, related party 2,525,948 2,283,985 $ 3,313,101 $ 3,119,587

Stockholders' Equity (Deficit)

Stockholders' Equity (Deficit)	12 Months Ended
	Jun. 30, 2013
Equity [Abstract]
Stockholders' Equity (Deficit)	NOTE 7 - STOCKHOLDERS’ EQUITY (DEFICIT) Preferred Stock The articles of incorporation of Veritec authorize 10,000,000 shares of preferred stock with a par value of $1.00 per share. The Board of Directors is authorized to determine any number of series into which shares of preferred stock may be divided and to determine the rights, preferences, privileges and restrictions granted to any series of the preferred stock. In 1999, a new Series H convertible preferred stock was authorized. Each share of Series H convertible preferred stock is convertible into 10 shares of the Veritec’s common stock at the option of the holder. As of June 30, 2013 and 2012, there were 1,000 shares of Series H convertible preferred stock issued and outstanding. Common Stock Common stock consists of $.01 par value, 50,000,000 shares authorized, 15,920,088 shares issued and outstanding as of June 30, 2013 and 2012. Common Stock to be issued Shares to be issued to consultant for services rendered On June 7, 2013, the Company entered into a "Business Development Agreement" with a consultant to assist the Company in establishing business relationships in the United States and to assist in seeking financing for the Company. Upon signing of the agreement the Company granted the consultant 50,000 shares of common stock with a fair value at the date of grant of $7,477 as an initial non-refundable engagement fee and recognized such amount as consulting fee during the fiscal year June 30, 2013. The shares due have not been issued as of June 30, 2013 and have been reflected as common shares to be issued in the accompanying consolidated balance sheet.

Stock Options and Warrants

Stock Options and Warrants	12 Months Ended
	Jun. 30, 2013
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Stock-Based Compensation	NOTE 8 – STOCK OPTIONS AND WARRANTS Stock Options A summary of stock options as of June 30, 2013 and for the two years then ended is as follows: Number of Weighted - Average Shares Exercise Price Outstanding at June 30, 2011 824,249 $0.47 Granted — $0.00 Forfeited (70,000 ) $1.02 Outstanding at June 30, 2012 754,249 $0.42 Granted 2,500,000 $0.08 Forfeited (88,666 ) $0.00 Outstanding at June 30, 2013 3,165,583 $0.42 Exercisable at June 30, 2013 3,165,583 $0.42 The Company has agreements with certain employees that provide for five years of annual grants of options, on each employment anniversary date, to purchase shares of the Company’s common stock. The option price is determined based on the market price on the date of grant, the options vest one year from the date of grant, and the options expire five years after vesting. The Company granted 2,500,000 options under this arrangement 2013. The weighted-average grant date fair value for options granted in fiscal 2013 was $0.43. The Company recognized stock-based compensation expense of $181,171 and $0 during the years ended June 30, 2013 and 2012, respectively. As of June 30, 2013, there was no remaining unrecognized compensation costs related to stock options. Based upon the trading value of the common shares, there was no intrinsic value of these options as of June 30, 2013. The fair value of each option award is estimated on the date of grant using the Black-Scholes option pricing model that uses the weighted-average assumptions noted in the following table. The risk-free rate for periods within the contractual life of the options is based on the U. S. Treasury yield in effect at the time of the grant. Volatility was based on the historical volatility of the Company’s common stock. The Company estimated the expected life of options based on historical experience and other averaging methods. Years Ended June 30, 2013 2012 Risk-free interest rates -- % -- % Dividend yields -- % -- % Volatility -- % -- % Weighted average expected life N/A N/A Additional information regarding options outstanding as of June 30, 2013 is as follows: Options Outstanding at June 30, 2013 Options Exercisable at June 30, 2013 Weighted Average Weighted Weighted Number of Remaining Average Number of Average Range of Shares Contractual Life Exercise Shares Exercise Exercise Outstanding (Years) Price Exercisable Price $0.13 - $1.45 3,165,583 3.06 $ 0.42 3,165,583 $ 0.42 3,165,583 3,165,583 The weighted-average remaining contractual life of stock options outstanding and exercisable at June 30, 2013 is 3.06 years. Stock Warrant A summary of stock warrants as of June 30, 2013 and for the two years then ended is as follows: Number of Weighted - Average Shares Exercise Price Outstanding at June 30, 2011 275,000 $2.0 Granted — Forfeited — Outstanding at June 30, 2012 275,000 $2.0 Granted — Forfeited — $2.0 Outstanding at June 30, 2013 275,000 The Company issued 275,000 shares of warrants related to notes payable issued in fiscal year 2009. The warrants are fully vested as of issue date, and were exercisable at $2 per share. The weighted average contractual life of the warrants was 5 years, which expired in March 2014 and May 2014.

Income Taxes

Income Taxes	12 Months Ended
	Jun. 30, 2013
Income Tax Disclosure [Abstract]
Income Taxes	NOTE 9 - INCOME TAXES Veritec files a consolidated income tax return in the United States. For the year ended June 30, 2013, net loss was $821,572 and our provision for income taxes was zero. We made no provision for income taxes due to our utilization of federal net operating loss carry forwards to offset both regular taxable income and alternative minimum taxable income. For the year ended June 30, 2012, net loss was $846,461 and no income tax provision was recorded. It is the Company’s practice to recognize penalties and/or interest related to income tax matters in the interest and penalties expense. There are no interest and penalties recognized in the consolidated statement of operations or accrued on the consolidated balance sheets. The company is subject to U.S. federal, state, or local income tax examination by tax authorities for all years for which a loss carry forward is utilized in subsequent periods. A reconciliation between the expected federal income tax rate and the actual tax rate is as follows: Year Ended June 30, 2013 2012 Federal Statutory tax rate (34) % (34) % State tax, net of federal benefit (6) % (6) % Change in valuation (40) % (40) % Allowance 40 % 40 % Effective tax rate - % - % The following is a summary of the deferred tax assets): June 30, 2013 2012 Net operating loss carryforwards 4,150,073 3,328,501 Valuation allowance (4,150,073 ) (3,328,501 ) Net deferred tax asset $ — $ — -28- Deferred income tax assets have been reduced by a valuation allowance as it is more likely than not that they will not be realized. Veritec has net operating loss carryforwards of $10,356,000 for federal purposes available to offset future taxable income that expire in varying amounts through 2032. The ability to utilize the net operating loss carry forwards could be limited by Section 382 of the Internal Revenue Code which limits their use if there is a change in control (generally a greater than 50% change in ownership).

Commitments and Contingencies

Commitments and Contingencies	12 Months Ended
	Jun. 30, 2013
Commitments and Contingencies
Commitments and Contingencies	NOTE 10 – COMMITMENTS AND CONTINGENCIES Operating Leases The Company leases its U.S. office facilities from its CEO/Executive Chair under a lease that expired June 30, 2013 and was automatically extended for a 2-year extension, requiring monthly payments of $4,200 plus common area costs. Future annual minimum lease payments are $50,400 in each fiscal year through 2014 totaling $100,800. Strategic Partnership Agreements On October 25, 2010, the Company entered into a Strategic Services Agreement with National Identity Solutions (NIS). The term of the license is for 5 years commencing on the effective date, which was the date of the first payment, or September 28, 2011. NIS paid the total fee of $250,000 in two installments. The Company classified this fee as deferred revenue to be recognized over the license term of 5 years as the Company has a continuing obligation. As of June 30, 2013, the amount of deferred revenues was $165,347. During the third and fourth quarter of the fiscal year ended June 30, 2013, the Company received $100,850 from a major customer for purchase of Veriwrite™ ID cards and custom platform/program. These products and services were not delivered or completed as of June 30, 2013. As a result, the $100,850 advanced money received from the Client was deferred as of June 30, 2013. On November 14, 2012 (effective date), the Company entered into a Strategic Product License Agreement with AAA Western and Central New York (AAA) for $100,000 license fee. The term of the license is for 5 years commencing on the effective date. The Company has classified the license fee as deferred revenue to be recognized ratably over the license term of 5 years as the Company has a continuing obligation. As of June 30, 2013, the amount of deferred revenue was $92,500. In May 2013 and June 2013, the Company received $500,000 and $52,600 (aggregated to $552,600) from Winforsys Co., Ltd. and Pan-Co International, Inc. respectively, as payment for 2,500 dongles and Vericode® license software and 130 dongles and Veriread™ license software. As of June 30, 2013, the Company was not able to complete and deliver the ordered items as a result the Company recorded the $552,600 as deferred revenues. Incentive Compensation Bonus Plan On December 5, 2008, the Company adopted an incentive compensation bonus plan to provide payments to key employees in the aggregated amount of 10% of pre-tax earnings in excess of $3,000,000 after the end of each fiscal year to be distributed annually to employees.

Subsequent Events

Subsequent Events	12 Months Ended
	Jun. 30, 2013
Subsequent Events [Abstract]
Subsequent Events	NOTE 11 – SUBSEQUENT EVENTS Strategic Partnership Agreement On July 14, 2014, the Company entered into a strategic partnership agreement with Cellular Network Centers (CNC) to combine the distribution of CNC products and services with the Company’s blinx On-Off™, TogglePay™ close loop/open loop prepaid and BI-O ID cards. Per the terms of the agreement, the Company received $75,000 and plans to receive the remaining $75,000 by August 2014. The Company, upon the receipt of the remaining $75,000, is obligated to issue CNC 100,000 shares of its common stock. On March, 2014, the Company responded to a RFI (request for information) from AAA National to submit a proposal for the AAA Member Data Capture (MDC) program. After an extensive evaluation process by the AAA MDC Committee which consists of 16 committee members, on August 2014, the Company received final confirmation and got the highest rate amongst the 4 remaining companies. The Company is waiting for the AAA MDC Committee to formally request the test launch for a national merchant discounts programs to be fully tested for AAA members. In August 2014, AAA Western & Central NY also notified its commitment and ready to launch the “Swipe and Save” and “Load and Pay” program with the Company before the end of 2014. On September 30, 2014, Veritec ("Buyer"), and Tangible Payments LLC ("Seller"), a Maryland Limited Liability Company, entered into an Asset Purchase Agreement (the "Asset Purchase Agreement") pursuant to which Veritec acquired certain assets and liabilities of the Tangible Payments LLC. As part of the Asset Purchase Agreement, Timothy Spear, the President of Tangible Payments LLC, entered into employment agreement with Veritec. The employment agreement makes Timothy Spear a principal officer in the Veritec Company. The purchase price for the acquisition was comprised of 250,000 shares of restricted stock of Veritec valued at $37,500, issuable upon closing, and an earnout payment of $155,000. The earnout payment is payable on a monthly basis from the net profits derived from the acquired assets commencing three months after the closing. The earnout payment is accelerated and the balance of the earnout payment shall be due in full at such time as Veritec receives equity investments aggregating $1.3 million. Other These consolidated financial statements should be read in conjunction with the financial statements and notes thereto included in the Company's Form 10-K for the year ended June 30, 2014 filed on October 20, 2014 with the Securities and Exchange Commission, which contains additional information of events subsequent to June 30, 2013.

Significant Accounting Policies

Significant Accounting Policies (Policies)	12 Months Ended
	Jun. 30, 2013
Accounting Policies [Abstract]
Net Loss per Common Share	Loss per Common Share Basic earnings (loss) per share are computed by dividing the net income (loss) applicable to Common Stockholders by the weighted average number of shares of Common Stock outstanding during the year. Diluted earnings (loss) per share is computed by dividing the net income (loss) applicable to Common Stockholders by the weighted average number of common shares outstanding plus the number of additional common shares that would have been outstanding if all dilutive potential common shares had been issued, using the treasury stock method. Potential common shares are excluded from the computation as their effect is antidilutive. For the years ended June 30, 2013 and 2012, the calculations of basic and diluted loss per share are the same because potential dilutive securities would have an anti-dilutive effect. The potentially dilutive securities consisted of the following as of: June 30, 2013 2012 Warrants 275,000 275,000 Series H Preferred Stock 10,000 10,000 Convertible Notes Payable 8,146,039 6,382,758 Options 3,165,583 754,249 Total 11,596,622 7,422,007
Concentrations	Concentrations The Company’s cash balances on deposit with banks are guaranteed by the Federal Deposit Insurance Corporation up to $250,000. The Company may be exposed to risk for the amounts of funds held in one bank in excess of the insurance limit. In assessing the risk, the Company’s policy is to maintain cash balances with high quality financial institutions. The Company had cash balance in excess of the guarantee during the year ended June 30, 2013. -20- Major Customers: Customers in excess of 10% of total revenues were as follows: Years Ended June 30, 2013 2012 Customer A 18 % 19 % Customer B 11 % 12 % Customer C 31 % 6 % Customer D 12 % - % Customer E - % 23 % Customer F - % 11 % 72 % 71 % As of June 30, 2013, the Company had approximately 250,000 (83%) and $26,563 (9%), respectively, of accounts receivable due from its major customers. As of June 30, 2012, the Company had $6,050 (25%) and $10,025 (42%), respectively, of accounts receivable due from its major customers.
Recent Accounting Pronouncements	Recent Accounting Pronouncements On May 28, 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update No. 2014-09 (ASU 2014-09), Revenue from Contracts with Customers In April 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update No. 2014-08 (ASU 2014-08), Presentation of Financial Statements (Topic 205) and Property, Plant and Equipment (Topic 360) -10- about discontinued operations. Under the new guidance, only disposals representing a strategic shift in operations or that have a major effect on the Company's operations and financial results should be presented as discontinued operations. This new accounting guidance is effective for annual periods beginning after December 15, 2014. The Company is currently evaluating the impact of adopting ASU 2014-08 on the Company's results of operations or financial condition. In August 2014, the FASB issued Accounting Standards Update No. 2014-15 (ASU 2014-15), Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern, which provides guidance on determining when and how to disclose going-concern uncertainties in the financial statements. The new standard requires management to perform interim and annual assessments of an entity’s ability to continue as a going concern within one year of the date the financial statements are issued. An entity must provide certain disclosures if conditions or events raise substantial doubt about the entity’s ability to continue as a going concern. The ASU applies to all entities and is effective for annual periods ending after December 15, 2016, and interim periods thereafter, with early adoption permitted. Other recent accounting pronouncements issued by the FASB (including its Emerging Issues Task Force), the AICPA, and the Securities Exchange Commission (the "SEC") did not or are not believed by management to have a material impact on the Company's present or future financial statements.

Operations and Summary of Sig20

Operations and Summary of Significant Accounting Policies (Policies)	12 Months Ended
	Jun. 30, 2013
Accounting Policies [Abstract]
Nature of Business	Nature of Business The Company is primarily engaged in the development, marketing, sales and licensing of products and rendering of professional services related thereto in the following two fields of technology: (1) proprietary two-dimensional matrix symbology (also commonly referred to as “two-dimensional barcodes” or “2D barcodes”), and (2) mobile banking solutions. The Company’s two-dimensional matrix symbology technology will hereafter be referred to as the Company’s “Barcode Technology”, and the Company’s mobile banking technology will hereafter be referred to as its “Mobile Banking Technology”. The Company’s Barcode Technology was originally invented by the founders of Veritec under United States patents 4,924,078, 5,331,176, 5,612,524 and 7,159,780. Our principal licensed product to date that contains our VeriCode ® Barcode Technology has been a product identification system for identification and tracking of manufactured parts, components and products mostly in the liquid crystal display (LCD) markets. The VeriCode® symbol is a two-dimensional high data density machine-readable symbol that can contain up to approximately 500 bytes of data. The Company’s VSCode® Barcode Technology is a derivative of the VeriCode® symbol with the ability to encrypt a greater amount of data by increasing data density. The VSCode ® is a data storage “container” that offers a high degree of security and which can also be tailored to the application requirements of the user. The VSCode ® symbol can hold any form of binary information that can be digitized, including numbers, letters, images, photos, graphics, and the minutia for biometric information, including fingerprints and facial image data, to the extent of its data storage capacity, that are likewise limited by the resolution of the marking and reading devices employed by the user. VSCode ® is ideal for secure identification documents (such as national identification cards, driver’s licenses, and voter registration cards), financial cards, medical records and other high security applications. In its PhoneCodes™ product platform, Veritec developed software to send, store, display, and read a VeriCode® Barcode Technology symbol on the LCD screen of a mobile phone. With the electronic media that provide the ease of transferring information over the web, Veritec’s PhoneCodes™ technology enables individuals and companies to receive or distribute gift certificates, tickets, coupons, receipts, or engage in banking transactions using the VeriCode ® technology via wireless phone or PDA. On January 12, 2009, Veritec formed VTFS, a Delaware corporation, to bring its Mobile Banking Technology, products and related professional services to market. In May 2009 Veritec was registered by Security First Bank in Visa’s Third Party Registration Program as a Cardholder Independent Sales Organization and Third-Party Servicer. As a Cardholder Independent Sales Organization, Veritec was able to promote and sell Visa branded card programs. As a Third-Party Servicer, Veritec provided back-end cardholder transaction processing services for Visa branded card programs on behalf of Security First Bank. As of October 2010 the Company’s registration with Security First Bank terminated. As of April 2011 the Company signed an ISO and processor agreement with Palm Desert National Bank (which was later assigned to First California Bank) to market and processes the Company’s Visa branded card program on behalf of the bank. First California Bank was sold to Pacific Western Bank and in June 2013 Pacific Western Bank closed its entire debit card division and transferred its contract with VTFS to Central Bank of Kansas City Bank. On February 5 th
Principles of Consolidation	Principles of Consolidation The accompanying consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. Intercompany transactions and balances were eliminated in consolidation.
Use of Estimates	Use of Estimates The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that may affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Those estimates and assumptions include estimates for reserves of uncollectible accounts, analysis of impairments of long lived assets, accruals for potential liabilities and assumptions made in valuing stock instruments issued for services.
Accounts Receivable	Accounts Receivable The Company sells to domestic and foreign companies and grants uncollateralized credit to customers, but requires deposits on unique orders. Management periodically reviews its accounts receivable and provides an allowance for doubtful accounts after analyzing the age of the receivable, payment history and prior experience with the customer. The estimated loss that management believes is probable is included in the allowance for doubtful accounts. While the ultimate loss may differ, management believes that any additional loss will not have a material impact on the Company's financial position. Due to uncertainties in the settlement process, however, it is at least reasonably possible that management's estimate will change during the near term.
Inventories	Inventories Inventories, consisting of purchased components for resale, are stated at the lower of cost or market, applying the first-in, first-out (FIFO) method. Inventory is net of reserves of $23,900 at both June 30, 2013 and 2012.
Property and Equipment	Property and Equipment Property and equipment are stated at cost less accumulated depreciation. Depreciation is computed using the straight-line method over estimated useful lives of 3 to 7 years. When assets are retired or otherwise disposed, the cost and related accumulated depreciation are removed from the accounts and the resulting gain or loss is recognized. Maintenance and repairs are expensed as incurred; significant renewals and betterments are capitalized. Management regularly reviews property, equipment and other long-lived assets for possible impairment. This review occurs quarterly, or more frequently if events or changes in circumstances indicate the carrying amount of the asset may not be recoverable. If there is indication of impairment, management prepares an estimate of future cash flows (undiscounted and without interest charges) expected to result from the use of the asset and its eventual disposition. If these cash flows are less than the carrying amount of the asset, an impairment loss is recognized to write down the asset to its estimated fair value. Based upon management’s assessment, there were no indicators of impairment at June 30, 2013 or 2012.
Concentrations	Concentrations The Company’s cash balances on deposit with banks are guaranteed by the Federal Deposit Insurance Corporation up to $250,000. The Company may be exposed to risk for the amounts of funds held in one bank in excess of the insurance limit. In assessing the risk, the Company’s policy is to maintain cash balances with high quality financial institutions. The Company had cash balance in excess of the guarantee during the year ended June 30, 2013. -20- Major Customers: Customers in excess of 10% of total revenues were as follows: Years Ended June 30, 2013 2012 Customer A 18 % 19 % Customer B 11 % 12 % Customer C 31 % 6 % Customer D 12 % - % Customer E - % 23 % Customer F - % 11 % 72 % 71 % As of June 30, 2013, the Company had approximately 250,000 (83%) and $26,563 (9%), respectively, of accounts receivable due from its major customers. As of June 30, 2012, the Company had $6,050 (25%) and $10,025 (42%), respectively, of accounts receivable due from its major customers.
Foreign Revenues	Foreign Revenues Foreign revenues accounted for 96% of the Company’s total revenues in fiscal 2013 and 56% in fiscal 2012. (21% Taiwan, 70% Korea, and 5% others in fiscal 2013 and 10% Taiwan, 41% Korea, and 5% others in fiscal 2012.)
Fair Value of Financial Instruments	Fair Value of Financial Instruments Fair Value Measurements are adopted by the Company based on the authoritative guidance provided by the Financial Accounting Standards Board, with the exception of the application of the statement to non-recurring, non-financial assets and liabilities as permitted. The adoption based on the authoritative guidance provided by the Financial Accounting Standards Board did not have a material impact on the Company's fair value measurements. Based on the authoritative guidance provided by the Financial Accounting Standards Board defines fair value as the price that would be received to sell an asset or paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants at the measurement date. FASB authoritative guidance establishes a fair value hierarchy, which prioritizes the inputs used in measuring fair value into three broad levels as follows: Level 1 - Quoted prices in active markets for identical assets or liabilities. Level 2 - Inputs, other than the quoted prices in active markets that are observable either directly or indirectly. Level 3 - Unobservable inputs based on the Company's assumptions. The Company had no such assets or liabilities recorded to be valued on the basis above at June 30, 2013 or 2012. For certain financial instruments, the carrying amounts reported in the consolidated balance sheets for cash and cash equivalents, accounts receivable, and current liabilities, including notes payable and convertible notes, each qualify as financial instruments and are a reasonable estimate of their fair values because of the short period of time between the origination of such instruments and their expected realization and their current market rates of interest.
Revenue Recognition	Revenue Recognition The Company accounts for revenue recognition in accordance with guidance of the Financial Accounting Standards Board. Revenues for the Company are classified into four separate products: license revenue (Veritec’s Multi-Dimensional matrix symbology), hardware revenue, identification card revenue, and debit card revenue. Revenues from licenses, hardware, and identification cards are recognized when the product is shipped, the Company no longer has any service or other continuing obligations, and collection is reasonably assured. The process typically begins for license and hardware revenue with a customer purchase order detailing its hardware specifications so the Company can import its software into the customer's hardware. Once importation is completed,
Shipping and Handling Fees and Costs	Shipping and Handling Fees and Costs For the years ended June 30, 2013 and 2012, shipping and handling fees billed to customers of $1,816 and $3,156, respectively were included in revenues and shipping and handling costs of $1,675 and $2,988, respectively were included in cost of sales.
Research and Development	Research and Development Research and development costs were expensed as incurred.
Loss per Common Share	Loss per Common Share Basic earnings (loss) per share are computed by dividing the net income (loss) applicable to Common Stockholders by the weighted average number of shares of Common Stock outstanding during the year. Diluted earnings (loss) per share is computed by dividing the net income (loss) applicable to Common Stockholders by the weighted average number of common shares outstanding plus the number of additional common shares that would have been outstanding if all dilutive potential common shares had been issued, using the treasury stock method. Potential common shares are excluded from the computation as their effect is antidilutive. For the years ended June 30, 2013 and 2012, the calculations of basic and diluted loss per share are the same because potential dilutive securities would have an anti-dilutive effect. The potentially dilutive securities consisted of the following as of: June 30, 2013 2012 Warrants 275,000 275,000 Series H Preferred Stock 10,000 10,000 Convertible Notes Payable 8,146,039 6,382,758 Options 3,165,583 754,249 Total 11,596,622 7,422,007
Stock-Based Compensation	Stock-Based Compensation The Company periodically issues stock options and warrants to employees and non-employees in capital raising transactions, for services and for financing costs. Stock-based compensation for employees are measured at the grant date, based on the fair value of the award, and is recognized as expense over the requisite service period. Options vest and expire according to terms established at the grant date. The value of the stock compensation to non-employees is based upon the measurement date as determined at either a) the date at which a performance commitment is reached, or b) at the date at which the necessary performance to earn the equity instruments is complete.
Income Taxes	Income Taxes Current income tax expense is the amount of income taxes expected to be payable for the current year. A deferred income tax asset or liability is established for the expected future consequences of temporary differences in the financial reporting and tax bases of assets and liabilities. The Company considers future taxable income and ongoing, prudent and feasible tax planning strategies, in assessing the value of its deferred tax assets. If the Company determines that it is more likely than not that these assets will not be realized, the Company will reduce the value of these assets to their expected realizable value, thereby decreasing net income. Evaluating the value of these assets is necessarily based on the Company’s judgment. If the Company subsequently determined that the deferred tax assets, which had been written down, would be realized in the future, the value of the deferred tax assets would be increased, thereby increasing net income in the period when that determination was made.
Recently Issued Accounting Standards	Recently Issued Accounting Standards On May 28, 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update No. 2014-09 (ASU 2014-09), Revenue from Contracts with Customers In April 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update No. 2014-08 (ASU 2014-08), Presentation of Financial Statements (Topic 205) and Property, Plant and Equipment (Topic 360) In August 2014, the FASB issued Accounting Standards Update No. 2014-15 (ASU 2014-15), Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern, which provides guidance on determining when and how to disclose going-concern uncertainties in the financial statements. The new standard requires management to perform interim and annual assessments of an entity’s ability to continue as a going concern within one year of the date the financial statements are issued. An entity must provide certain disclosures if conditions or events raise substantial doubt about the entity’s ability to continue as a going concern. The ASU applies to all entities and is effective for annual periods ending after December 15, 2016, and interim periods thereafter, with early adoption permitted. Other recent accounting pronouncements issued by the FASB (including its Emerging Issues Task Force), the AICPA, and the Securities Exchange Commission (the "SEC") did not or are not believed by management to have a material impact on the Company's present or future financial statements.

Operations and Summary of Sig21

Operations and Summary of Significant Accounting Policies (Tables)	12 Months Ended
	Jun. 30, 2013
Accounting Policies [Abstract]
Major Customers	Years Ended June 30, 2013 2012 Customer A 18 % 19 % Customer B 11 % 12 % Customer C 31 % 6 % Customer D 12 % - % Customer E - % 23 % Customer F - % 11 % 72 % 71 %
Earnings per share	June 30, 2013 2012 Warrants 275,000 275,000 Series H Preferred Stock 10,000 10,000 Convertible Notes Payable 8,146,039 6,382,758 Options 3,165,583 754,249 Total 11,596,622 7,422,007

Property and Equipment (Tables)

Property and Equipment (Tables)	12 Months Ended
	Jun. 30, 2013
Property, Plant and Equipment [Abstract]
Property and Equipment	June 30, 2013 2012 Furniture and equipment $ 139,083 $ 139,083 Software 73,000 73,000 Vehicles 23,301 23,301 235,384 235,384 Less accumulated depreciation 235,384 234,740 $ — $ 644

Notes Payable (Tables)

Notes Payable (Tables)		12 Months Ended
		Jun. 30, 2013
Debt Disclosure [Abstract]
Notes Payable	[1]	June 30, 2013 2012 Convertible notes payable (includes $132,920 and $124,921, respectively, to non-related parties), unsecured, interest at 8%, due September 2010 through November 2010. The principal and accrued interest is convertible at a conversion price of $0.30. The principal and interest is due immediately on the event of default or change of control. The notes are currently in default. $ 739,815 $ 695,815 Convertible notes payable to related parties, unsecured, principal and interest are convertible into common stock at $0.30 to $0.33 per share, interest at 8% to 10%, due on demand to November 2010. The notes are currently in default. 1,023,173 871,951 Convertible note payable to related party, secured by the Company’s intellectual property, principal and interest are convertible into common stock at $0.25 per share subject to board of directors’ approval, interest at 8%. The note was due November 2010 and is now in default. 258,871 242,871 Note payable to related party, secured by the Company’s intellectual property, interest at 8% due August 2010 and is now in default. 502,578 471,838 Notes payable to related parties, unsecured, interest at 0% to 8%, due on demand. 134,430 126,430 Note payable, unsecured, interest at 10%. The note was due in January 2010 and is now in default. Notes payable, secured by the Company's certificate of deposit with a financial institution and classified on the balance sheet as restricted cash, interest at 5%, convertible into common stock at $0.08 per share, due on demand 27,167 30,753 25,167 29,293 Convertible note payable, unsecured, principal and interest are convertible into common stock at $0.30 to $0.40 per share subject to board of directors’ approval, interest at 5% to 8%, due January 2011 to March 2013 and is now in default. 23,411 22,110 Notes payable, unsecured, interest at 5%, due January 2013 and now in default. (1) 301,228 444,374 Note payable, secured by the Company's intellectual property, interest at variable rates starting September 1, 2012, due December 2012 and is now in default. 270,150 257,957 Convertible note payable, unsecured, principal and interest are convertible into common stock at $1.00 per share subject to board of directors’ approval, interest at 8%. The note was due November 2009 and is now in default. 1,525 1,523 Total $ 3,313,101 $ 3,189,329 Less valuation discount on notes payable — (69,742 ) Grand total $ 3,313,101 $ 3,119,587
Notes payable- Balance Sheet presentation		June 30, 2013 2012 Notes payable $ 787,153 $ 835,602 Notes payable, related party 2,525,948 2,283,985 $ 3,313,101 $ 3,119,587
[1]	In connection with the issuance of the notes payable, two stockholders of the Company granted the lender the option to acquire 1,600,000 unrestricted shares of the Companys common stock from the stockholders at a price of $0.40 per share. The agreement to provide the lender with the option to purchase shares of the two shareholders was presumed to be a separate arrangement between the Company and the lender. As such, the Company valued the shares as if they had provided the lender an option to acquire these shares. The aggregate value of the 1,600,000 shares was valued at $129,931 using Black-Scholes option valuation model with the following assumptions: expected life, 1 year, risk free interest rate, 0.10%, volatility, 250%, and dividend rate, 0%. The value of the option is being considered as a valuation discount and was amortized over the one year life of the Note. For the year ended June 30, 2013, the Company recognized the remaining $69,742 of expense related to the amortization of this discount and is included in the interest expense in the consolidated statement of operations.

Stock Options and Warrants (Tab

Stock Options and Warrants (Tables)	12 Months Ended
	Jun. 30, 2013
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Summary of Stock Options	Number of Weighted - Average Shares Exercise Price Outstanding at June 30, 2011 824,249 $0.47 Granted — $0.00 Forfeited (70,000 ) $1.02 Outstanding at June 30, 2012 754,249 $0.42 Granted 2,500,000 $0.08 Forfeited (88,666 ) $0.00 Outstanding at June 30, 2013 3,165,583 $0.42 Exercisable at June 30, 2013 3,165,583 $0.42
Fair Value of Options	Years Ended June 30, 2013 2012 Risk-free interest rates -- % -- % Dividend yields -- % -- % Volatility -- % -- % Weighted average expected life N/A N/A
Additional information regarding outstanding options	Options Outstanding at June 30, 2013 Options Exercisable at June 30, 2013 Weighted Average Weighted Weighted Number of Remaining Average Number of Average Range of Shares Contractual Life Exercise Shares Exercise Exercise Outstanding (Years) Price Exercisable Price $0.13 - $1.45 3,165,583 3.06 $ 0.42 3,165,583 $ 0.42 3,165,583 3,165,583
Summary of stock warrants	Number of Weighted - Average Shares Exercise Price Outstanding at June 30, 2011 275,000 $2.0 Granted — Forfeited — Outstanding at June 30, 2012 275,000 $2.0 Granted — Forfeited — $2.0 Outstanding at June 30, 2013 275,000

Income Taxes (Tables)

Income Taxes (Tables)	12 Months Ended
	Jun. 30, 2013
Income Tax Disclosure [Abstract]
Reconciliation between the federal and actual tax rate	Year Ended June 30, 2013 2012 Federal Statutory tax rate (34) % (34) % State tax, net of federal benefit (6) % (6) % Change in valuation (40) % (40) % Allowance 40 % 40 % Effective tax rate - % - %
Deferred tax assets	June 30, 2013 2012 Net operating loss carryforwards 4,150,073 3,328,501 Valuation allowance (4,150,073 ) (3,328,501 ) Net deferred tax asset $ — $ —

Operations and Summary of Sig26

Operations and Summary of Significant Accounting Policies - Major Customers (Details)	12 Months Ended
	Jun. 30, 2013	Jun. 30, 2012
Revenue from Major Customers	72.00%	71.00%
Customer A
Revenue from Major Customers	18.00%	19.00%
Customer B
Revenue from Major Customers	11.00%	12.00%
Customer C
Revenue from Major Customers	31.00%	6.00%
Customer D
Revenue from Major Customers	12.00%
Customer E
Revenue from Major Customers		23.00%
Customer F
Revenue from Major Customers		11.00%

Operations and Summary of Sig27

Operations and Summary of Significant Accounting Policies - Earnings per share (Details) - USD ($)	12 Months Ended
	Jun. 30, 2013	Jun. 30, 2012
Dilutive securities	$ 11,596,622	$ 7,422,007
Warrants
Dilutive securities	275,000	275,000
Series H Preferred Stock
Dilutive securities	10,000	10,000
Convertible Notes Payable
Dilutive securities	8,146,039	6,382,758
Options
Dilutive securities	$ 3,165,583	$ 754,249

Property and Equipment - Proper

Property and Equipment - Property and Equipment (Details) - USD ($)	Jun. 30, 2013	Jun. 30, 2012
Property and Equipment		$ 644
Less accumulated depreciation	$ 235,384	234,740
Furniture and equipment
Less accumulated depreciation	139,083	139,083
Software
Less accumulated depreciation	73,000	73,000
Vehicles
Less accumulated depreciation	$ 23,301	$ 23,301

Notes Payable - Notes Payable (

Notes Payable - Notes Payable (Details) - USD ($)	Jun. 30, 2013	Jun. 30, 2012
Notes payable	$ 3,313,101	$ 3,189,329
Recorded discount on notes payable		(69,742)
Notes Payable	3,313,101	3,119,587
Unsecured, due Sept 2010 to Nov 2010
Convertible notes payable	739,815	695,815
Convertible notes payable, non-related paries	$ 132,921	$ 124,921
Interest rate	8.00%	8.00%
Conversion price	$ .30	$ .30
Warrant to purchase common stock for every dollar of investment	$ 2	$ 2
Unsecured, due Nov 2010
Convertible notes payable	$ 1,023,173	$ 871,951
Interest rate	8.00%	8.00%
Interest rate, maximum	10.00%	10.00%
Conversion price	$ 0.05	$ 0.05
Conversion price, maximum	$ 0.33	$ 0.33
Secured, due Nov 2010
Convertible notes payable	$ 258,871	$ 242,871
Interest rate	8.00%	8.00%
Conversion price	$ .25	$ .25
Secured, due Aug 2010
Interest rate	8.00%	8.00%
Notes payable	$ 502,578	$ 471,838
Unsecured, due on demand
Interest rate	0.00%	0.00%
Interest rate, maximum	8.00%	8.00%
Notes payable	$ 134,430	$ 126,430
Unsecured, due Jan 2010
Interest rate	10.00%	10.00%
Notes payable	$ 27,167	$ 25,167
Secured, due on demand
Interest rate	5.00%	5.00%
Conversion price	$ .08	$ .08
Notes payable	$ 30,753	$ 29,293
Unsecured, due Jan 2011 to March 2013
Convertible notes payable	$ 23,411	$ 22,110
Interest rate	5.00%	5.00%
Interest rate, maximum	8.00%	8.00%
Conversion price	$ .30	$ 0.30
Conversion price, maximum	$ .40	$ 0.40
Amount in default	$ 12,187
Unsecured, due Jan 2013
Interest rate	5.00%	5.00%
Notes payable	$ 301,228	$ 444,374
Secured, due Dec 2012
Notes payable	270,150	257,957
Unsecured, due Nov 2009
Convertible notes payable	$ 1,525	$ 1,523
Interest rate	8.00%	8.00%
Conversion price	$ 1	$ 1

Notes Payable - Notes payable -

Notes Payable - Notes payable - Balance Sheet presentation (Details) - USD ($)	Jun. 30, 2013	Jun. 30, 2012
Debt Disclosure [Abstract]
Notes payable	$ 787,153	$ 835,602
Notes payable, related party	2,525,948	2,283,985
Total	$ 3,313,101	$ 3,119,587

Stock-Based Compensation - Summ

Stock-Based Compensation - Summary of Stock Options (Details) - $ / shares	12 Months Ended
	Jun. 30, 2013	Jun. 30, 2012
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Beginning number of shares; outstanding	754,249	824,248
Beginning weighted-average exercise price; outstanding	$ .42	$ .47
Options Granted	2,500,000
Options granted, weighted average exercise price	$ 0.08	$ 0
Options Forfeited	(88,666)	(70,000)
Options Forfeited, weighted average exercise price	$ 0	$ 1.02
Ending number of shares; outstanding	3,165,583	754,249
Ending weighted-average exercise price; outstanding	$ .42	$ .42
Number of Shares; exercisable	3,165,583
Weighted-average exercise price; exercisable	$ .42

Fair Value of Options (Details)

Fair Value of Options (Details) None in scaling factor is -9223372036854775296	12 Months Ended
	Jun. 30, 2013	Jun. 30, 2012
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Risk-free interest rates
Dividend yields
Volatility

Additional information regardin

Additional information regarding outstanding options (Details) - Jun. 30, 2013 - $ / shares	Total
Options outstanding, shares	3,165,583
Weighted average remaining contractual life	3 years
Weighted average exercise price	$ .42
Options excercisable	3,165,583
Options exercisable, weighted average exercise price	$ .42
Min
Weighted average exercise price	0.13
Max
Weighted average exercise price	$ 1.5

Summary of stock warrants (Deta

Summary of stock warrants (Details) - $ / shares	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2011
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Warrants Outstanding, Shares	275,000	275,000	275,000
Warrants Outstanding, Weighted Average Exercise Price	$ 2	$ 2	$ 2
Warrants Granted
Warrants Forfeited

Income Taxes - Reconciliation b

Income Taxes - Reconciliation between the federal and actual tax rate (Details)	12 Months Ended
	Jun. 30, 2013	Jun. 30, 2012
Income Tax Disclosure [Abstract]
Federal Statutory tax rate	(34.00%)	(34.00%)
State tax, net of federal benefit	(6.00%)	(6.00%)
Change in valuation	(40.00%)	(40.00%)
Allowance	40.00%	40.00%
Effective tax rate

Income Taxes - Deferred tax ass

Income Taxes - Deferred tax assets (Details) - USD ($)	Jun. 30, 2013	Jun. 30, 2012
Income Tax Disclosure [Abstract]
Net operating loss carryforwards	$ 4,150,073	$ 3,328,501
Valuation allowance	$ (4,150,073)	$ (3,328,501)
Net deferred tax asset

Operations and Summary of Sig37

Operations and Summary of Significant Accounting Policies (Details Narrative) - USD ($)	12 Months Ended
	Jun. 30, 2013	Jun. 30, 2012
Inventory	$ 23,900	$ 23,900
FDIC guarantee	$ 250,000
Foreign revenues	96.00%	56.00%
Shiping and handling fees billed to customers	$ 1,816	$ 3,156
Shipping and handling costs	$ 1,675	$ 2,988
Taiwan
Foreign revenues	21.00%	10.00%
Korea
Foreign revenues	70.00%	41.00%
Other
Foreign revenues	5.00%	5.00%
83%
Accounts receivable	$ 250,000
9%
Accounts receivable	$ 26,563
25%
Accounts receivable		$ 6,050
42%
Accounts receivable		$ 10,025
Min
Equipment Useful life	3 years
Max
Equipment Useful life	7 years

Going Concern (Details Narrativ

Going Concern (Details Narrative) - USD ($)	1 Months Ended	12 Months Ended
	Jun. 30, 2013	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2011
Working capital deficit	$ 5,412,538	$ 5,412,538
Stockholders' deficiency	(4,913,261)	(4,913,261)	$ (4,283,337)	$ (3,566,809)
Note payable obligations - in default	787,153	787,153
Payroll taxes and accrued interest and penalties	680,461	680,461	$ 521,568
Convertible notes payable	$ 68,500	$ 180,000
Van Tran
Ownership of TMG	50.00%	50.00%
Larry Johanns
Ownership of TMG	50.00%	50.00%

Restricted Cash (Details Narrat

Restricted Cash (Details Narrative) - USD ($)	Jun. 30, 2013	Jun. 30, 2012
Accounting Policies [Abstract]
Restricted Cash	$ 499,277	$ 500,000

Property and Equipment (Details

Property and Equipment (Details Narrative) - USD ($)	12 Months Ended
	Jun. 30, 2013	Jun. 30, 2012
Property, Plant and Equipment [Abstract]
Depreciation expense	$ 644	$ 15,824

Ralated Party Transactions (Det

Ralated Party Transactions (Details Narrative) - USD ($)	Jun. 30, 2013	Jun. 30, 2012
Accounts payable, related party	$ 82,129	$ 43,306
Van Tran
Ownership of TMG	50.00%
Larry Johanns
Ownership of TMG	50.00%

Stockholders' Equity (Deficit)

Stockholders' Equity (Deficit) (Details Narrative) - USD ($)	Jun. 07, 2013	Jun. 30, 2013	Jun. 30, 2012
Convertible preferred stock, par value		$ 1	$ 1
Convertible preferred stock, shares authorized		10,000,000	10,000,000
Convertible preferred stock, shares issued		1,000	1,000
Convertible preferred stock, shares outstanding		1,000	1,000
Series H convertible preferred stock to common stock		10
Common stock, par value		$ .01	$ .01
Common stock, shares authorized		50,000,000	50,000,000
Common stock, shares issued		15,920,088	15,920,088
Common stock, shares outstanding		15,920,088	15,920,088
Shares issued for services, shares	50,000	10,477
Shares issued for services, fair value	$ 7,477	$ 10,477
Series H Convertible
Convertible preferred stock, shares authorized		276,000	276,000
Convertible preferred stock, shares issued		1,000
Convertible preferred stock, shares outstanding		1,000

Stock Options and Warrants (Det

Stock Options and Warrants (Details Narrative) - USD ($)	Jun. 30, 2013	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2011
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Weighted-average remaining contractual life of stock options, outstanding	3 years
Weighted-average remaining contractual life of stock options, exercisable	3 years
Stock-based compensation		$ 181,171	$ 0
Options granted		2,500,000
Options, exercise price	$ .42	$ .42
Warrants issued	275,000	275,000
Warrant exercise price	$ 2	$ 2	$ 2	$ 2
Warrant, contractual life	5 years
2013 Agreement terms		The Company has agreements with certain employees that provide for five years of annual grants of options, on each employment anniversary date, to purchase shares of the Company’s common stock. The option price is determined based on the market price on the date of grant, the options vest one year from the date of grant, and the options expire five years after vesting.

Income Taxes (Details Narrative

Income Taxes (Details Narrative) - USD ($)	12 Months Ended
	Jun. 30, 2013	Jun. 30, 2012	Jun. 30, 2032
Income Tax Disclosure [Abstract]
Net loss	$ (821,572)	$ (846,461)
Net operating loss carryforwards			$ 10,356,000

Commitments and Contingencies (

Commitments and Contingencies (Details Narrative)	8 Months Ended	11 Months Ended	12 Months Ended
	Jun. 30, 2013USD ($)Dongles	Sep. 28, 2011USD ($)	Jun. 30, 2013USD ($)Dongles	Jun. 30, 2014USD ($)	Dec. 05, 2008USD ($)
Monthly lease payments			$ 4,200
Future annual minimum lease payments	$ 50,400		50,400
Total minimum lease payments				$ 100,800
Received from major customer	552,600		552,600
Incentive compensation plan percentage					10.00%
Incentive Compensation Bonus, Minimum Threshold					$ 3,000,000
Winforsys Co., Ltd.
Deferred revenue	500,000		500,000
Received from major customer	$ 500,000		$ 500,000
Units ordered | Dongles	2,500		2,500
Pan-Co International, Inc
Deferred revenue	$ 52,600		$ 52,600
Received from major customer	$ 52,600		$ 52,600
Units ordered | Dongles	130		130
NIS
Term of license		5 years
Total fee		$ 250,000
Deferred revenue	$ 165,347		$ 165,347
Veriwrite
Deferred revenue	100,850		100,850
Received from major customer	$ 100,850		100,850
AAA
Term of license	5 years
Total fee	$ 100,000
Deferred revenue	$ 92,500		$ 92,500

Subsequent Events (Details Narr

Subsequent Events (Details Narrative) - 15 months ended Sep. 30, 2014 - USD ($)	Total
Subsequent Events [Abstract]
Strategic partnership (CNC) compensation received	$ 75,000
Strategic partnership (CNC) compensation not yet received	$ 75,000
Shares issued to CNC for compensation	100,000
Purchase price for acquisition of Tangible Payments LLC, shares	250,000
Value of purchase price shares	$ 37,500
Earnout payment issued upon closing	155,000
Equity investment threshold, earnout payment due in full	$ 1,300,000