Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Jan. 31, 2014 |
Accounting Policies [Abstract] | ' |
Applicable Accounting Guidance | ' |
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Applicable Accounting Guidance |
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These consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”). Any reference in these notes to applicable accounting guidance is meant to refer to the authoritative nongovernmental United States generally accepted accounting principles as found in the Financial Accounting Standards Board’s (“FASB”) Accounting Standards Codification (“ASC”). |
Basis of Presentation and Principles of Consolidation | ' |
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Basis of Presentation and Principles of Consolidation |
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The accompanying consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All inter-company balances and transactions have been eliminated in consolidation. |
Use of Estimates | ' |
Use of Estimates |
The preparation of financial statements in conformity with United States GAAP requires management to make significant estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Although the Company regularly assesses these estimates, actual results could differ materially from these estimates. On an on-going basis, the Company evaluates its estimates and judgments, including those related to revenue recognition and allowance for doubtful accounts, stock- based compensation expense, intangible assets, and other long-lived assets, in-process research and development and income taxes. Changes in estimates are recorded in the period in which they become known. |
The Company bases its estimates on historical experience and various other assumptions that it believes to be reasonable under the circumstances. Actual results could differ from management’s estimates if future events differ substantially from past experience, or other assumptions, while reasonable when made, do not turn out to be substantially accurate. |
Change in Estimates | ' |
Change in Estimates |
Property and equipment are stated at cost. Major renewals, additions and betterments are charged to equipment accounts while replacements, maintenance and repairs which do not improve or extend the lives of the respective assets are expensed in the period incurred. Upon retirement or sale, the cost of the assets disposed of and the related accumulated depreciation are eliminated from the accounts and any resulting gain or loss is reflected in income from operations. Depreciation is computed using the straight-line method over the estimated useful life of each asset. |
The Company periodically reviews the estimated useful lives of property and equipment. Changes to the estimated useful lives are recorded prospectively from the date of the change. During the first quarter of fiscal year 2014, the Company reevaluated its network assets, consisting primarily of server equipment utilized in its data centers, and determined that the expected average useful life of those assets had increased from three to five years, due to advances in technology and increased durability of the server equipment. The net book value of server assets placed in service as of February 1, 2013 was approximately $2,755. This change resulted in a decrease in depreciation expense on these assets of approximately $456, or $0.03 per share, on an after-tax basis, for the fiscal year ended January 31, 2014. |
Revenue Recognition | ' |
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Revenue Recognition |
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The Company generates revenues from the licensing of its software products, typically in the form of one-year term “subscription” or capacity-based licenses that have a defined term, and from project fees for consulting services and training. Licenses for the Company’s software products may be software to be run on the customer’s own computer hardware, or provided in the form of software-as-a-service, via the Company’s hosted PowerFLOW OnDemand offering. |
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Software |
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The Company recognizes revenues from licensing the software products in accordance with ASC 985-605, Software Revenue Recognition. Term licenses typically have a term of one year and allow the customer to buy simulation in the form of a limited amount of simulation capacity on customer installed software and are sold based upon simulation capacity expected to be used within a certain time period—typically not exceeding one year. |
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The Company typically sells term and capacity-based software licenses combined in a bundled sale. For instance, when customers purchase simulation capacity, they typically also purchase a number of term-based licenses for preparation and analysis software. All of the Company’s software licenses include multiple elements such as support and maintenance. Pursuant to the guidance within ASC 985-605, the Company determined that since it does not have vendor-specific objective evidence of the fair value of the individual elements contained in a bundled sale of term and capacity-based software licenses, the arrangement is treated as a single unit of accounting and revenue is recognized ratably on a daily basis over the term of the license agreement, which coincides with the duration of the maintenance and support services. The Company’s arrangements typically do not include rights to carryover any unused capacity beyond the contractual license term or any customer right of return. |
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Licenses have finite terms that are not extendible at their expiration, and capacity usage is limited by contract to the amount specified. The Company’s practice is not to modify existing capacity-based licenses to allow simulation capacity to be added to an existing arrangement. A customer desiring to purchase additional simulation capacity or to license additional users of the Company’s preparation and analysis software during the term of the original simulation license does so by entering into a separate arrangement. Revenue from these new arrangements is recognized over the term of the new agreements, which include bundled maintenance and support, and are for a term of less than twelve months, coterminous with the remaining term of the original simulation license. |
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The Company commences recognition of term license revenue when persuasive evidence of an arrangement exists; delivery of the software or license keys has occurred and all service elements, if bundled or linked, have commenced; payment is fixed or determinable; and collection of the resulting receivable is considered probable by management. Payments received from customers in advance of revenue recognition are treated as deferred revenue. |
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If training or consulting service projects are bundled with a software license sale or, as a result of specific facts and circumstances, are determined to be linked with a software license sale, the Company treats this as one arrangement and recognizes revenue ratably on a daily basis over the license period provided that delivery of all elements of the arrangement have commenced. |
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Software as a service (OnDemand) |
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The Company recognizes revenue from software as a service arrangement’s in accordance with ASC 605. Capacity-based licenses allow the customer to buy simulation capacity as a service hosted by the Company and are sold based upon simulation capacity expected to be used within a certain time period—typically not exceeding one year. The contracts have finite terms that are not extendible at their expiration, and capacity usage is limited by contract to the amount specified. The Company’s practice is not to modify existing capacity-based licenses to allow simulation capacity to be added to an existing arrangement. A customer desiring to purchase additional simulation capacity or to license additional users of the Company’s preparation and analysis software during the term of the original simulation license must do so by entering into a separate arrangement. Revenue from these arrangements is recognized as the capacity is used. In the event that any capacity remains unused at the end of the term of the arrangement, it is recognized as revenue at that time. |
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Projects |
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The Company also derives revenue from fees for separate, project-based services. The Company’s projects are typically short term in nature and usually complete in less than 90 days. Project pricing is generally either fixed fee or time and material based. The Company recognizes revenue from these service arrangements in accordance with ASC 605. Projects are either sold as one deliverable, or as multiple deliverables with stand-alone value. For single deliverable projects, to the extent that adequate project reporting of time incurred and time to complete records exist, the Company recognizes consulting services revenue as the services are performed under the proportionate performance method. In other situations, for example, providing a customer with an on-site engineer for a defined period of time to provide services at the customer’s direction, the Company recognizes revenue ratably over the service period. In situations where the Company is unable to utilize the proportional performance method, for example due to either the lack of adequate documentation of time incurred or to be incurred or a lack of a defined service, period revenue is deferred until the contract is completed. |
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For projects which have multiple deliverables, each with stand alone value, the Company recognizes revenue based on ASC 605 and allocates the arrangement consideration based on the relative selling price of the deliverables. For the Company’s project deliverables, it uses best estimated selling price (“BESP”) as its selling price if vendor-specific objective evidence (“VSOE”) or third-party evidence of selling price (“TPE”) do not exist. If each deliverable does not have stand alone value, revenue recognition is deferred until the completion of the entire project. |
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Multiple element arrangements |
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Multiple element arrangements may include customer rights to any combination of software, project deliverables, software as a service, maintenance and training. |
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When more than one element is contained in a single arrangement, the Company first allocates revenue based upon the relative selling price into two categories: (1) non-software components, such as services under projects or software as a service and (2) software components, such as software applications and related items, such as post-contract customer support and other services. |
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Revenue allocated to non-software services is recognized based on ASC 605 and the arrangement consideration is allocated based on the relative selling price of the deliverables. For the Company’s non-software deliverables, it uses best estimated selling price (“BESP”) as its selling price if vendor-specific objective evidence (“VSOE”) or third-party evidence of selling price (“TPE”) do not exist. |
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Revenue allocated to products sold which meet the definition of software components is recognized based on software accounting guidance provided for in ASC 985-605. Under this guidance, the Company must use the residual method to recognize revenue when a multiple element arrangement includes one or more software related elements to be delivered at a future date and VSOE of fair value of all undelivered elements exists (typically maintenance and other services), but does not exist for the delivered elements (typically the software). Since the Company cannot establish VSOE for the undelivered elements, the entire arrangement is deferred and recognized ratably over the contract (maintenance) period. |
Foreign Currency Translation | ' |
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Foreign Currency Translation |
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The Company has foreign subsidiaries in England, France, Germany, Italy, Japan, Korea and China. For fiscal 2014, all of the Company’s foreign subsidiaries (excluding that in England) used their local currency as their functional currency in accordance with ASC 830, Foreign Currency Matters. Foreign subsidiary records are maintained in the local currency. Beginning in fiscal 2011, the Company’s French, German, Japanese and Korean subsidiaries began to translate their assets and liabilities denominated in their functional currency at current rates of exchange in effect at the balance sheet date. Beginning in fiscal 2012, the Company’s Italian subsidiary began to translate its assets and liabilities denominated in its functional currency at current rates of exchange in effect at the balance sheet date. During the first quarter of fiscal year 2013, the Company established a subsidiary in China. The Company’s review of the operations of this subsidiary indicated that it should use the local currency as its functional currency. As a result, the Company’s Chinese subsidiary translates its assets and liabilities denominated in its functional currency at current rates of exchange in effect at the balance sheet date. The resulting gains and losses from translation are included as a component of other comprehensive income. Transaction gains and losses and re-measurement of assets and liabilities denominated in currencies other than a subsidiary’s functional currency are included in other expense, net. Foreign currency (loss) gain included in other expense, net for the years ended January 31, 2014, 2013 and 2012 was $(83), $17 and $(106), respectively. |
Concentration of Credit Risk and Significant Customers | ' |
Concentration of Credit Risk and Significant Customers |
Financial instruments that potentially subject the Company to concentration of credit risks are principally cash and cash equivalents and accounts receivable. The Company invests its cash and cash equivalents with high credit quality financial institutions, and consequently, the Company believes that such funds are subject to minimal credit risk. The Company maintains its cash in bank deposit accounts, which at times may exceed federally insured limits, but management believes that the deposits are not exposed to significant credit risk due to the financial position of the depository institutions in which those financial instruments are held. |
Concentrated credit risk with respect to accounts receivable is limited to large creditworthy customers. The Company periodically assesses the financial strength of its customers and believes that its accounts receivable credit risk exposure is minimal. |
The Company typically does not require collateral from its customers for sales on account. The Company has not experienced significant losses related to receivables from individual customers or groups of customers in any specific industry or geographic region. |
The following table provides information concerning customers that individually accounted for greater than 10% of total revenues or 10% of accounts receivable, and their respective percentages of total revenues and accounts receivable, as of January 31, 2014, 2013 and 2012: |
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| | Year Ended January 31, | |
| | 2014 | | | 2013 | | | 2012 | |
| | Percentage of | | | Percentage of | | | Percentage of | | | Percentage of | | | Percentage of | | | Percentage of | |
total revenues | accounts | total revenues | accounts | total revenues | accounts |
| receivable at | | receivable at | | receivable at |
| fiscal year end | | fiscal year end | | fiscal year end |
Customer A | | | 12 | % | | | 21 | % | | | 11 | % | | | 24 | % | | | 13 | % | | | | * |
Customer B | | | | * | | | | * | | | | * | | | 15 | % | | | | * | | | 19 | % |
Customer C | | | | * | | | 15 | % | | | | * | | | | * | | | | * | | | | * |
Customer D | | | | * | | | 14 | % | | | | * | | | | * | | | | * | | | 15 | % |
Customer E | | | | * | | | 10 | % | | | | * | | | 11 | % | | | | * | | | 13 | % |
* | less than 10% | | | | | | | | | | | | | | | | | | | | | | | |
Concentration of Other Risks |
The Company has one main data center provider, and several support providers (which handle overflow), to host or provide access to hardware for the Company’s OnDemand application service to customers. The disruption of these services could have a material adverse effect on the Company’s business, financial position, and results of operations. |
Cash and Cash Equivalents and Restricted Cash | ' |
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Cash and Cash Equivalents and Restricted Cash |
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The Company considers all highly liquid investments purchased with an original maturity of 90 days or less, that are not restricted as to withdrawal, to be the equivalent of cash for the purpose of balance sheet and statement of cash flows presentation. Cash equivalents consisted of money market accounts as of January 31, 2014 and 2013. The Company maintains $525 of restricted cash related to an operating lease, which has been recorded within other long-term assets. |
Accounts Receivable and Allowances for Doubtful Accounts | ' |
Accounts Receivable and Allowances for Doubtful Accounts |
Accounts receivable are stated at the amount management expects to collect from outstanding balances. An allowance for doubtful accounts is provided to the extent that specific accounts receivable are considered to be uncollectible, based on historical experience, known collection issues, and management’s evaluation of outstanding accounts receivable at the end of the year. Uncollectible amounts, if any, are written-off against the allowance after all collection efforts have been exhausted. During the fiscal year ended January 31, 2014, the Company recorded $21 of net bad debt expense relating to write-offs of uncollectible receivables. Based on management’s analysis of its outstanding accounts receivable, and customers’ creditworthiness and collection history, the Company concluded that an allowance was not necessary as of January 31, 2014 and 2013. |
Property and Equipment, Net | ' |
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Property and Equipment, net |
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Property and equipment, net is stated at cost. Major renewals, additions and betterments are charged to property accounts while replacements, maintenance and repairs which do not improve or extend the lives of the respective assets are expensed in the period incurred. Upon retirement or sale, the cost of the assets disposed of and the related accumulated depreciation are eliminated from the accounts and any resulting gain or loss is reflected in the consolidated statement of operations. Depreciation is computed using the straight-line method over the estimated useful life of each asset, generally as follows: |
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Asset classification | | Estimated Useful Life | | | | | | | | | | | | | | | | | | | | | | |
Computer equipment | | 3-5 years | | | | | | | | | | | | | | | | | | | | | | |
Software | | 3 years | | | | | | | | | | | | | | | | | | | | | | |
Office equipment and furniture | | 3-5 years | | | | | | | | | | | | | | | | | | | | | | |
Leasehold improvements | | Shorter of useful life or remaining | | | | | | | | | | | | | | | | | | | | | | |
life of lease | | | | | | | | | | | | | | | | | | | | | | |
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Leasehold improvements and assets acquired under capital leases are typically amortized using the straight-line method over the shorter of the estimated useful life of the asset or the term of the lease. However, assets acquired under capital leases that contain bargain purchase options that are typically exercised are amortized over the estimated useful life of the asset. Amortization of leasehold improvements and assets acquired under capital leases is included in depreciation expense. |
Impairment of Long-Lived Assets | ' |
Impairment of Long-Lived Assets |
The Company reviews its long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of these assets is measured by comparison of their carrying amounts to the future undiscounted cash flows the assets are expected to generate. If any long-lived assets are considered to be impaired, the impairment recognized equals the amount by which the carrying value of the assets exceeds its estimated fair value. The Company did not identify any indicators of impairment of its long-lived assets during the fiscal years ended January 31, 2014 and 2013. |
In fiscal year 2012, the Company determined that it would not re-enter space currently under sublease and therefore took an impairment charge through depreciation expense of $0.3 million for leasehold improvements. |
Research and Development Expenses | ' |
Research and Development Expenses |
Research and development expense includes costs incurred to develop intellectual property and are charged to expense as incurred. The costs for the development of new software and substantial enhancements to existing software are expensed as incurred until technological feasibility has been established, at which time any additional costs are capitalized. The Company has determined that technological feasibility is established at the time a working model of software is completed. Because the Company believes that, under its current process for developing software, completion of the software is essentially concurrent with the establishment of technological feasibility, no costs have been capitalized to date. |
Advertising Costs | ' |
Advertising Costs |
Advertising costs are expensed as incurred. To date, the Company has not incurred significant advertising costs. |
Income Taxes | ' |
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Income Taxes |
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Income taxes are accounted for in accordance with ASC 740, Income Taxes. ASC 740 requires that deferred tax assets and liabilities are recorded based on temporary differences between the financial statement amounts and the tax basis of assets and liabilities, measured using enacted tax rates in effect for the year in which the differences are expected to reverse. The Company routinely assesses the likelihood that it will be able to realize its deferred tax assets. |
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During fiscal year 2012, the Company determined that it was more likely than not that it would be able to realize certain of its deferred tax assets primarily as a result of expected future taxable income. Accordingly, the Company reversed $12,501 of its valuation allowance during fiscal year 2012. |
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During fiscal year 2013, the Company reassessed its state tax profile and state apportionment. As a result, the Company recorded a valuation allowance against certain state investment tax credits and R&D credits in the amount of $155. This was due to the fact that management determined as of January 31, 2013 it was more likely than not that these assets would not be realized. |
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During fiscal year 2014, the Company updated its assessment of the realizability of the deferred tax assets, considering new state tax credits and expiring state net operating loss carryforwards, and reduced the valuation allowance by $104. |
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The Company follows ASC 740-10 (formerly FASB Interpretation No. 48 or FIN 48) with regards to accounting for uncertain tax positions, which prescribes a threshold for the financial statement recognition and measurement of a tax position taken or expected to be taken within an income tax return. For each tax position, the enterprise must determine whether it is more likely than not that the position will be sustained upon examination based on the technical merits of the position, including resolution of any related appeals or litigation. A tax position that meets the more likely than not recognition threshold is then measured to determine the amount of benefit to recognize within the financial statements. No benefits may be recognized for tax positions that do not meet the more likely than not threshold. The Company’s adoption of FIN 48 resulted in no effect on its financial position or results of operations in the year of adoption as the Company had a full valuation allowance against its deferred tax assets due to the uncertainty surrounding the realization of such assets. |
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The Company’s intention is to indefinitely reinvest the total amount of its unremitted foreign earnings in the local international jurisdictions, except for instances where the Company can remit such earnings to the United States without an associated net tax cost. As a result, the Company currently does not provide for United States taxes on the unremitted earnings of its international subsidiaries. |
Comprehensive Income and Accumulated Comprehensive Income | ' |
Comprehensive Income and Accumulated Comprehensive Income |
ASC 220, Comprehensive Income requires the reporting and display of comprehensive income and its components. Comprehensive income is defined as the change in equity of a business enterprise during a period from transactions, and other events and circumstances from non-owner sources. Accumulated other comprehensive income consists entirely of foreign currency translation adjustments at January 31, 2014, 2013, and 2012. |
Fair Value of Common Stock Prior to Initial Public Offering | ' |
Fair Value of Common Stock prior to Initial Public Offering |
Prior to the Company’s initial public offering in July 2012, estimates of the fair value of the shares of its common stock were historically performed by the Company’s board of directors based upon information available to them at the time of grant. Prior to January 31, 2011, the Company’s board of directors did not conduct any formal valuation procedure or commission any third party valuation or appraisal in connection with its determinations of the fair value of its common stock. The Company’s board of directors considered the most persuasive evidence of fair value to be the prices at which the Company’s securities were sold in actual arms’ length transactions. The Company’s board of directors also considered numerous other objective and subjective factors in the assessment of fair value, including reviews of the Company’s business and financial condition, the conditions of the industry in which the Company operates and the markets that the Company serves and general economic, market and United States and global capital market conditions, an analysis of publicly traded peer companies, the lack of marketability of the Company’s common stock, the likelihood of achieving a liquidity event for the shares of common stock underlying its stock options, such as an initial public offering or sale of the Company, the preferences and privileges of the Company’s preferred stock over the rights of the Company’s common stock, the status of strategic initiatives being undertaken by the Company’s management and board of directors and, after January 31, 2011, independent third party valuations of the Company’s common stock. All options have been granted at exercise prices not less than the fair value of the underlying shares on the date of grant. |
In considering the fair value of the Company’s common stock, the Company’s board of directors and management considered the impact of the accumulated liquidation preferences of the Company’s preferred stock. The Company’s board recognized that any sale or other exit scenario other than an initial public offering at a valuation less than the accumulated liquidation preference would result in the receipt by common stockholders of no consideration. However, when estimating the fair value of the Company’s common stock for purposes of equity-based compensation, the Company’s board also took into account the alternative that all outstanding shares of preferred stock would convert to common stock prior to the exit transaction, such that the accumulated liquidation preferences would not factor into the fair value of the common stock. |
ASC 820, Fair Value Measurements and Disclosures, establishes a hierarchy of inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that observable inputs be used when available. Observable inputs are inputs that market participants would use in pricing the asset or liability based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company’s assumptions about the inputs that market participants would use in pricing the asset or liability, and are developed based on the best information available in the circumstances. The fair value hierarchy is broken down into three levels based on the source of inputs as follows: |
Level 1—Valuations based on unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access. |
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Level 2—Valuations based on quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active and models for which all significant inputs are observable, either directly or indirectly. |
Level 3—Valuations based on inputs that are unobservable and significant to the overall fair value measurement and that are based on management’s best estimate of inputs market participants would use for pricing the asset or liability at the measurement date, including assumptions about risk. |
Stock-Based Compensation | ' |
Stock-Based Compensation |
The Company accounts for stock-based compensation in accordance with ASC 718, Compensation—Stock Compensation. Under the fair value recognition provisions of ASC 718, share-based compensation cost is measured at the grant date based on the fair value of the award and is recognized as expense over the requisite service or vesting period. Determining the fair value of equity awards at the grant date requires judgment. The Company estimates the grant date fair value of stock options using the Black-Scholes option valuation model. This option valuation model requires the input of subjective assumptions including: (1) expected life (estimated period of time outstanding) of the options granted, (2) volatility, (3) risk-free rate, (4) dividends and (5) the fair value of the Company’s common stock. Because share-based compensation expense is based on awards ultimately expected to vest, it is reduced for estimated forfeitures. |
ASC 718 requires forfeitures to be estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures rates differ from those estimates. Forfeitures are estimated based on historical experience. |
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The Company recognizes windfall tax benefits associated with the exercise of stock options or release of restricted stock units directly to stockholders’ equity only when realized. A windfall tax benefit occurs when the actual tax benefit realized by the Company upon an employee’s disposition of a share-based award exceeds the deferred tax asset, if any, associated with the award that we had recorded. When assessing whether a tax benefit relating to share-based compensation has been realized, the Company follows the “with-and-without” method. Under the with-and-without method, the windfall is considered realized and recognized for financial statement purposes only when an incremental benefit is provided after considering all other tax benefits including the Company’s net operating losses. The with-and-without method results in the windfall from share-based compensation awards always being effectively the last tax benefit to be considered. Consequently, the windfall attributable to share-based compensation will not be considered realized in instances where our net operating loss carryover (that is unrelated to windfalls) is sufficient to offset the current year’s taxable income before considering the effects of current-year windfalls. |
The Company computes volatility under the “calculated value method” of ASC 718, Compensation—Stock Compensation. As the Company does not have a trading history for its common stock prior to its initial public offering or a significant trading range for its common stock trading since the initial public offering, the Company estimates the expected price volatility for its common stock by taking the average historic price volatility for selected industry peers based on daily price observations over a period equivalent to the expected term of the stock options granted. The Company’s industry peers consist of several public companies that are similar to the Company in size, stage of life cycle and financial leverage. The Company intends to consistently apply this process using the same or similar public companies until a sufficient amount of historical information regarding the volatility of its common stock becomes available, or unless circumstances change such that the currently utilized companies are no longer similar to the Company, in which case, more suitable companies with publicly available share prices will be utilized in the calculation. |
Since adopting ASC 718, the Company has been unable to use historical employee exercise and option expiration data to estimate the expected term assumption for the Black-Scholes grant-date valuation. As such, the Company has utilized the “simplified” method, as prescribed by Staff Accounting Bulletin No. 107, Share-Based Payment, to estimate on a formula basis the expected term of its stock options considered to have “plain vanilla” characteristics. For option issuances that do not have “plain vanilla” characteristics, the Company uses an average based on the specific facts and circumstances of such issuances. |
Net (Loss) Income per Share | ' |
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Net (Loss) Income per Share |
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Net (loss) income per share is computed using the weighted average number of shares of common stock outstanding during each period. Diluted amounts per share include the impact of the Company’s outstanding potential common shares, such as shares issuable upon exercise of in-the-money stock options or warrants or upon conversion of convertible preferred stock, when dilutive. Potential common shares that are anti-dilutive are excluded from the calculation of diluted net (loss) income per common share. The impact of the accretion of unpaid and undeclared dividends was not reflected in the weighted average shares used to compute diluted net (loss) income per share as the former convertible preferred stock was not entitled to receive undeclared dividends upon such conversion. |
Recent Accounting Pronouncements | ' |
Recent Accounting Pronouncements |
In December 2011, the FASB issued ASU No. 2011-11, Balance Sheet (Topic 210)—Disclosures about Offsetting Assets and Liabilities (ASU No 2011-11). The update requires entities to disclose information about offsetting and related arrangements of financial instruments and derivative instruments. The Company adopted ASU 2011-11 on February 1, 2013. This adoption did not have a material impact on the Company’s consolidated financial statements. |
In February 2013, the FASB issued ASU No. 2013-02, Comprehensive Income (Topic 220): Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income (ASU 2013-02). ASU 2013-02 requires companies to provide information about the amounts reclassified out of accumulated other comprehensive income by component. Companies are also required to disclose these reclassifications by each respective line item on the statements of operations. ASU 2013-02 is effective prospectively for annual reporting periods beginning after December 15, 2012, and interim periods within those annual periods. The Company adopted ASU 2013-02 on February 1, 2013. This adoption did not have a material impact on the Company’s consolidated financial statements. |
In July 2013, the FASB issued ASU No. 2013-11, Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists (ASU 2013-11). ASU 2013-11 clarifies guidance and eliminates diversity in practice on the presentation of unrecognized tax benefits when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists at the reporting date. This new guidance is effective for the Company in the first quarter of fiscal year 2015. The Company adopted ASU 2013-11 on February 1, 2014. This adoption did not have a material impact on the Company’s consolidated financial statements. |
Segment Reporting | ' |
ASC 280, Segment Reporting establishes standards for reporting information regarding operating segments in annual financial statements and requires selected information of those segments to be presented in annual and interim reports issued to stockholders. Operating segments are identified as components of an enterprise about which separate discrete financial information is available for evaluation by the chief operating decision-maker, or decision-making group, in making decisions on how to allocate resources and assess performance. The Company’s chief decision maker, as defined under ASC 280, is a combination of the chief executive officer and the chief operating officer. The Company views its operations and manages its business as one operating segment. |