Arotech (ARTX) 10-Q 8 Aug 18 2018 Q2 Quarterly report Financial data

Document And Entity Information

Document And Entity Information - shares	6 Months Ended
	Jun. 30, 2018	Aug. 06, 2018
Document and Entity Information [Abstract]
Entity Registrant Name	AROTECH CORPORATION
Document Type	10-Q
Current Fiscal Year End Date	--12-31
Entity Common Stock, Shares Outstanding		26,486,152
Amendment Flag	false
Entity Central Index Key	916,529
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Entity Filer Category	Accelerated Filer
Entity Well-known Seasoned Issuer	No
Document Period End Date	Jun. 30, 2018
Document Fiscal Year Focus	2,018
Document Fiscal Period Focus	Q2

CONDENSED CONSOLIDATED BALANCE

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($)	Jun. 30, 2018		Dec. 31, 2017
CURRENT ASSETS:
Cash and cash equivalents	$ 7,477,354		$ 5,205,246
Restricted collateral deposits	191,101		283,508
Trade receivables	14,331,028		19,258,960
Unbilled receivables	16,478,741		16,094,515
Other accounts receivable and prepaid expenses	2,272,989		2,342,220
Inventories	9,787,946		8,654,878
Total current assets	50,539,159		51,839,327
LONG TERM ASSETS:
Contractual and Israeli statutory severance pay fund	3,688,152		3,754,789
Other long term receivables	499,161		184,331
Property and equipment, net	8,965,582		9,276,088
Other intangible assets, net	4,543,187		5,205,605
Goodwill	46,138,036		46,138,036
Total long term assets	63,834,118		64,558,849
Total assets	114,373,277	[1]	116,398,176
CURRENT LIABILITIES:
Trade payables	4,850,996		5,560,196
Other accounts payable and accrued expenses	4,645,437		6,640,154
Current portion of long term debt	2,232,803		2,248,043
Short term bank credit	5,571,024		5,092,088
Deferred revenues	7,048,675		6,778,313
Total current liabilities	24,348,935		26,318,794
LONG TERM LIABILITIES:
Contractual and accrued Israeli statutory severance pay	4,663,751		4,709,807
Long term portion of debt	7,456,259		8,570,524
Deferred income tax liability	5,962,555		5,600,721
Other long term liabilities	112,636		105,112
Total long-term liabilities	18,195,201		18,986,164
Total liabilities	42,544,136		45,304,958
STOCKHOLDERS’ EQUITY:
Common stock – $0.01 par value each; Authorized: 50,000,000 shares as of June 30, 2018 and December 31, 2017; Issued and outstanding: 26,486,152 shares and 26,395,048 shares as of June 30, 2018 and December 31, 2017, respectively	264,862		263,951
Preferred shares – $0.01 par value each; Authorized: 1,000,000 shares as of June 30, 2018 and December 31, 2017; No shares issued or outstanding as of June 30, 2018 and December 31, 2017	0		0
Additional paid-in capital	250,962,076		250,826,873
Accumulated deficit	(180,889,686)		(181,568,757)
Notes receivable from stockholders	(908,054)		(908,054)
Accumulated other comprehensive income	2,399,943		2,479,205
Total stockholders’ equity	71,829,141		71,093,218
Total liabilities and stockholders’ equity	$ 114,373,277		$ 116,398,176
[1]	Out of those amounts, goodwill in the Company's Training and Simulation Division and Power Systems Division totaled $24,435,641 and $21,702,395, respectively, as of June 30, 2018 and $24,435,641 and $21,647,674, respectively, as of June 30, 2017.

CONDENSED CONSOLIDATED BALANCE3

CONDENSED CONSOLIDATED BALANCE SHEETS (Parentheticals) - $ / shares	Jun. 30, 2018	Dec. 31, 2017
Common Stock - par value (in Dollars per share)	$ 0.01	$ 0.01
Common stock - authorized	50,000,000	50,000,000
Common stock- shares issued	26,486,152	26,395,048
Common stock - shares outstanding	26,486,152	26,395,048
Preferred shares - par value (in Dollars per share)	$ 0.01	$ 0.01
Preferred shares - shares authorized	1,000,000	1,000,000
Preferred shares - shares issued	0	0
Preferred shares -shares outstanding	0	0

CONDENSED CONSOLIDATED STATEMEN

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (UNAUDITED) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Revenues	$ 21,874,609	$ 21,448,693	$ 49,123,118	$ 43,796,138
Cost of revenues	15,275,082	15,466,496	34,812,163	31,333,994
Research and development expenses	728,293	764,416	1,764,995	1,759,850
Selling and marketing expenses	1,931,388	1,971,477	3,809,461	3,967,444
General and administrative expenses	2,985,879	2,839,370	6,211,813	5,856,588
Amortization of intangible assets	391,831	521,660	906,742	1,219,653
Total operating costs and expenses	21,312,473	21,563,419	47,505,174	44,137,529
Operating income (loss)	562,136	(114,726)	1,617,944	(341,391)
Other income (expense), net	7,396	(1,894)	7,399	10,260
Financial expense, net	(309,779)	(215,187)	(522,887)	(549,044)
Total other expense	(302,383)	(217,081)	(515,488)	(538,784)
Income (loss) before income tax expense	259,753	(331,807)	1,102,456	(880,175)
Income tax expense	176,271	262,820	423,385	482,760
Net income (loss)	83,482	(594,627)	679,071	(1,362,935)
Other comprehensive income, net of income tax:
Foreign currency translation adjustment	(55,002)	671,142	(79,262)	1,586,174
Comprehensive income	$ 28,480	$ 76,515	$ 599,809	$ 223,239
Loss per share of common stock:
Basic net income (loss) per share (in Dollars per share)	$ 0	$ (0.02)	$ 0.03	$ (0.05)
Diluted net income (loss) per share (in Dollars per share)	$ 0	$ (0.02)	$ 0.03	$ (0.05)
Weighted average number of shares used in computing basic net loss per share (in Shares)	26,432,094	26,216,775	26,457,133	26,193,509
Weighted average number of shares used in computing diluted net loss per share (in Shares)	26,432,094	26,216,775	26,457,133	26,193,509

CONDENSED CONSOLIDATED STATEME5

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) - USD ($)	6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)	$ 679,071	$ (1,362,935)
Adjustments required to reconcile net income (loss) to net cash provided by operating activities:
Depreciation	960,557	862,555
Amortization of intangible assets	906,742	1,219,653
Stock based compensation	190,269	192,926
Deferred tax provision	361,834	457,272
Changes in operating assets and liabilities:
Trade receivables	4,840,684	1,922,996
Unbilled receivables	(384,226)	954,274
Other accounts receivable and prepaid expenses	(250,515)	(506,040)
Inventories	(1,157,602)	20,873
Severance pay, net	(26,425)	(1,954,264)
Trade payables	(719,743)	194,400
Other accounts payable and accrued expenses	(2,022,522)	(676,302)
Deferred revenues	270,362	(1,475,989)
Net cash provided by (used in) operating activities	3,648,486	(150,581)
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment	(652,156)	(3,155,303)
Additions to capitalized software	(244,324)	(128,367)
Net cash used in investing activities	(896,480)	(3,283,670)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from long term debt	0	2,150,000
Repayment of long term debt	(1,129,505)	(701,211)
Other financing activities	(54,155)	0
Change in short term bank credit	478,936	857,843
Net cash (used in) provided by financing activities	(704,724)	2,306,632
INCREASE (DECREASE) IN CASH, RESTRICTED CASH, AND CASH EQUIVALENTS	2,047,282	(1,127,619)
CASH DIFFERENCES DUE TO EXCHANGE RATE DIFFERENCES	132,419	(903,962)
CASH, RESTRICTED CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE PERIOD	5,488,754	7,130,983
CASH, RESTRICTED CASH AND CASH EQUIVALENTS AT THE END OF THE PERIOD	7,668,455	5,099,402
SUPPLEMENTARY CASH FLOW INFORMATION:
Interest paid during the period	455,797	339,058
Taxes paid on income during the period	$ 51,410	$ 112,822

NOTE 1_ BASIS OF PRESENTATION

NOTE 1: BASIS OF PRESENTATION	6 Months Ended
	Jun. 30, 2018
Accounting Policies [Abstract]
Organization, Consolidation and Presentation of Financial Statements Disclosure and Significant Accounting Policies [Text Block]	NOTE 1: BASIS OF PRESENTATION a. Company: Arotech Corporation (“Arotech”) and its wholly-owned subsidiaries (the “Company”) provide defense and security products for the military, law enforcement, emergency services and homeland security markets, including multimedia interactive simulators/trainers, and lithium batteries and chargers. The Company operates primarily through its wholly-owned subsidiaries FAAC Incorporated, a Michigan corporation located in Ann Arbor, Michigan (Training and Simulation Division) with a location in Orlando, Florida; Epsilor-Electric Fuel Ltd. (“Epsilor-EFL”), an Israeli corporation located in Beit Shemesh, Israel (between Jerusalem and Tel-Aviv) in Dimona, Israel (in Israel’s Negev desert area) and Sderot, Israel (near the Gaza Strip) (Power Systems Division); UEC Electronics, LLC (“UEC”), a South Carolina limited liability company located in Hanahan, South Carolina (Power Systems Division). b. Basis of Presentation: The Company prepared the accompanying unaudited condensed consolidated financial statements of Arotech Corporation and all wholly-owned, majority owned or otherwise controlled subsidiaries on the same basis as its annual audited financial statements. The Company condensed or omitted certain information and footnote disclosures normally included in its annual audited financial statements, which it prepared in accordance with U.S. Generally Accepted Accounting Principles (GAAP), with the instructions to Form 10-Q and with Article 10 of Regulation S-X, and include the accounts of Arotech Corporation and its subsidiaries. The Company’s quarterly financial statements should be read in conjunction with its Annual Report on Form 10-K for the year ended December 31, 2017. In the opinion of the Company, the unaudited financial statements reflect all adjustments (consisting only of normal recurring adjustments) necessary for a fair presentation of its financial position at June 30, 2018, its operating results for the six and three-month periods ended June 30, 2018 and 2017, and its cash flows for the six-month periods ended June 30, 2018 and 2017. The results of operations for the six and three months ended June 30, 2018 are not necessarily indicative of results that may be expected for any other interim period or for the full fiscal year ending December 31, 2018. The condensed consolidated balance sheet at December 31, 2017 has been derived from the audited financial statements at that date but does not include all the information and footnotes required by generally accepted accounting principles for complete financial statements. These condensed consolidated financial statements should be read in conjunction with the audited financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2017. c. Reclassification: From time to time the Company may reclassify amounts from prior periods to conform to current year’s presentation. d. Commitments and contingencies: The Company is involved in litigation from time to time in the regular course of its business. There are no material legal proceedings pending or known by the Company to be contemplated to which the Company is a party or to which any of its property is subject. In addition, the Company believes that adequate provisions for resolution of all contingencies have been made for probable losses that are reasonably estimable. These contingencies are subject to uncertainties, and, as a result, the Company is unable to estimate the amount or range of loss, if any, in excess of amounts accrued. The Company does not believe that the these contingencies will have a material adverse effect on the Company’s balance sheets, statements of operations and comprehensive income or statements of cash flows for the period and six months ended June 30, 2018. e. Goodwill and other long-lived assets: Goodwill and indefinite-lived intangible assets are tested for impairment at least annually and between annual tests in certain circumstances, and written down when impaired. Goodwill is tested for impairment by comparing the fair value of the Company’s reporting units with the carrying value. The Training and Simulation and the Power Systems reporting units have goodwill. As of its last annual impairment test at December 31, 2017, the Company determined that the goodwill for both reporting units was not impaired. Consistent with previous interim reporting periods, the Company monitors qualitative and quantitative factors, including internal projections, periodic forecasts, and actual results of the reporting unit. Based upon this interim review, the Company does not believe that goodwill or its indefinite-lived intangible assets related to either reporting unit is impaired. f. New accounting pronouncements: In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) Codification Improvement to Topic 842 In July 2018, the FASB issued ASU No. 2018-11, Targeted Improvements to Topic 842. This amendment provides the Company with an additional and optional transition method to adopt the new leases standard. Under this new transition method, the Company can apply the new lease standard at the adoption date and recognize a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption and present the accounting on a prospective or go-forward basis instead of applying to the earliest comparative period presented in the financial statements. The Company expects to adopt using the optional transition method effective January 1, 2019. The Company is currently evaluating the potential changes from this ASU on its financial reporting, disclosures and impact to its processes and controls. The Company expects that the ROU asset and lease liability amounts recognized in the balance sheets will be material but does not expect it to have a material impact on its results of operations or liquidity.

NOTE 2_ SIGNIFICANT ACCOUNTING

NOTE 2: SIGNIFICANT ACCOUNTING POLICIES UPDATE	6 Months Ended
	Jun. 30, 2018
Accounting Policies [Abstract]
Significant Accounting Policies [Text Block]	NOTE 2: SIGNIFICANT ACCOUNTING POLICIES UPDATE The Company’s significant accounting policies are detailed in “Note 2: Significant Accounting Policies” of its Form 10-K for the year ended December 31, 2017. Significant changes to the Company’s accounting policies as a result of changes in functional currency, the impact of changes to tax legislation, and adopting Accounting Standards Codification (“ASC”) 606 are discussed below: Functional Currency: The United States dollar (“U.S. dollar”) is the currency of the primary economic environment in which the Company’s U.S. subsidiaries operate and the Company has adopted and are using the U.S. dollar as its functional currency. Transactions and balances originally denominated in U.S. dollars are presented at the original amounts. Accordingly, monetary accounts maintained in currencies other than dollars are re-measured into dollars, with resulting gains and losses reflected in the consolidated statements of operations and comprehensive income as financial income or expenses, as appropriate. In the first quarter of 2018, the Company concluded that the functional currency for its Israeli subsidiary, Epsilor-EFL, changed from the New Israeli Shekel (“NIS”) to the U.S. dollar. The primary reason for the change in functional currencies is due to a change in Epsilor-EFL operations whereby the majority of its contracts and material costs are anticipated to be sourced in U.S. dollars. The Company believes that the change in functional currency for this business was necessary as it reflects the primary economic environment in which Epsilor-EFL now operates. The change in functional currency for Epsilor-EFL is accounted for prospectively from January 1, 2018, and prior year financial statements have not been restated for the change in functional currency. The financial statements of Epsilor-EFL are now reported in U.S. dollars. All balance sheet accounts were translated using the exchange rates in effect at the time of the change in functional currency. The statements of comprehensive income and cash flows are also reported in U.S. dollars. Income Taxes: The U.S. Tax Cuts and Jobs Act (“Tax Act”) was enacted on December 22, 2017. The Tax Act makes broad complex changes to the U.S. tax code including, but not limited to, reducing the U.S. federal corporate tax rate from 35% to 21%, requiring companies to pay a one-time transition tax on earnings of certain foreign subsidiaries that were previously tax deferred, and creating new taxes on certain foreign sourced earnings and additional limitations on the deductibility of interest. The SEC issued Staff Accounting Bulletin No. 118 (SAB 118) in December, 2017, to provide guidance on accounting for the effects of the Tax Act. SAB 118 provides for a measurement period of up to one year from the Tax Act enactment date for companies to complete their assessment of and accounting for those effects of the Tax Act. Under SAB 118, a company must first reflect the income tax effects of the Tax Act for which the accounting is complete in the period of the date of enactment. To the extent the accounting for other income tax effects is incomplete, but a reasonable estimate can be determined, companies must record a provisional estimate to be included in their financial statements. For any income tax effect for which a reasonable estimate cannot be determined, an entity must continue to apply ASC 740 based on the provisions of the tax laws in effect immediately prior to the Tax Act being enacted until such time as a reasonable estimate can be determined. The Company requires additional time to complete its analysis of the impacts of the Tax Act and therefore its accounting for the Tax Act is provisional but is a reasonable estimate based on available information. The Company will complete its analysis and finalize its accounting for this provisional estimate during the one year measurement period as prescribed by SAB 118. Revenue recognition: In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers, as a new Topic, ASC 606. The new revenue recognition standard relates to revenue from contracts with customers, which, along with amendments issued in 2016 and 2015, supersedes nearly all current U.S. GAAP guidance on this topic and eliminates industry-specific guidance. The Company accounts for revenue in accordance with ASC 606, Revenue from Contracts with Customers, which the Company adopted on January 1, 2018, using the modified retrospective method. The Company evaluated the distinct performance obligations and the pattern of revenue recognition of its significant contracts upon adoption of the standard. Consequently, after its review of contracts in each revenue stream, the Company concluded that the impact of adopting the standard did not have an impact to its consolidated balance sheets, statements of operations, changes in stockholders’ equity, or cash flows. During 2018 and 2017, the Company recognized revenues from (i) the sale and customization of interactive training systems (Training and Simulation Division); (ii) maintenance services in connection with such systems (Training and Simulation Division); (iii) the sale of batteries, chargers and adapters, and custom power solutions (Power Systems Division); and (iv) the sale of lifejacket lights (Power Systems Division). The Company determines its revenue recognition through the following steps: · Identification of the contract, or contracts, with a customer · Identification of the performance obligations within the contract · Determination of the transaction price · Allocation of the transaction price to the performance obligations within the contract · Recognition of revenue when, or as the performance obligation has been satisfied Performance Obligations. The Company also offers maintenance and support agreements (“warranties”) for many of its products. The specific terms and conditions of those warranties vary depending upon the product sold and country in which the product was sold. The warranty revenue is recognized on a straight-line basis over the term of the maintenance and support services. The standalone selling price is determined based on the price charged when sold separately or upon renewal. The Company’s performance obligations are satisfied over time as work progresses or at a point in time. Revenue from products and services transferred to customers over time accounted for 93% percent and 92% percent of its revenue for the six-month periods ended June 30, 2018, and June 30, 2017, respectively. Substantially all of the Company’s revenue in the Training and Simulation Division and the U.S. Power Systems Division is recognized over time. Typically, revenue is recognized over time using an input measure (e.g., costs incurred to date relative to total estimated costs at completion) to measure progress. Contract costs include labor, material, and overhead. On June 30, 2018, the Company had $65.9 million of expected future revenue relating to performance obligations currently in progress, which it also refers to as total backlog. The Company expects to recognize approximately 51% percent of its backlog as revenue in 2018, and the remaining 49% percent by the end of 2019 and thereafter. Contract Estimates. Contract estimates are based on various assumptions to project the outcome of future events that can exceed a year. These assumptions include labor productivity and availability; the complexity of the work to be performed; the cost and availability of materials; the performance of subcontractors; and the availability and timing of funding from the customer. As a significant change in one or more of these estimates could affect the profitability of its contracts, the Company reviews and updates its contract-related estimates quarterly. The Company recognizes adjustments in estimated profit on contracts under the cumulative catch-up method. Under this method, the impact of the adjustment on profit recorded to date is recognized in the period the adjustment is identified. Revenue and profit in future periods of contract performance is recognized using the adjusted estimate. If at any time the estimate of contract profitability indicates an anticipated loss on the contract, the Company recognizes the total loss in the quarter it is identified. The aggregate impact of adjustments in contract estimates to net income (loss) are presented below: Six months ended June 30, 2018 Six months ended June 30, 2017 Training and Simulation Division Power Systems Division Training and Simulation Division Power Systems Division Net income (loss) $ 588,596 $ (242,866 ) $ 456,188 $ 300,911 Three months ended June 30, 2018 Three months ended June 30, 2017 Training and Simulation Division Power Systems Division Training and Simulation Division Power Systems Division Net income (loss) $ 517,156 $ (123,088 ) $ 175,558 $ (361,190 ) Revenue by Category. Revenue by major product line was as follows: Six months ended June 30, Three months ended June 30, 2018 2017 2018 2017 Product Revenue Air Warfare Simulation $ 9,657,370 $ 9,401,852 $ 4,624,711 $ 5,078,038 Vehicle Simulation 10,999,632 4,343,349 5,535,633 1,482,707 Use-of-Force 6,545,553 5,146,413 3,285,505 2,808,298 Service Revenue Warranty 1,707,695 1,651,389 906,537 822,771 Total Training and Simulation Division $ 28,910,250 $ 20,543,003 $ 14,352,386 $ 10,191,814 Contract Manufacturing $ 7,030,011 $ 6,450,886 $ 2,865,685 $ 3,838,314 Power Distribution and Generation 4,281,921 2,330,552 1,006,541 1,301,600 Batteries 6,649,514 11,189,348 2,503,403 5,301,162 Engineering Services and Other 2,251,422 3,282,349 1,146,594 815,803 Total Power Division $ 20,212,868 $ 23,253,135 $ 7,522,223 $ 11,256,879 The table below details the percentage of total recognized revenue by type of arrangement for the six and three months ended June 30, 2018 and 2017: Six months ended June 30, Three months ended June 30, Type of Revenue 2018 2017 2018 2017 Sale of products 95.3 % 96.2 % 92.2 % 96.2 % Maintenance and support agreements 3.4 % 3.8 % 4.1 % 3.8 % Long term research and development contracts 1.3 % – 3.7 % – Total 100 % 100 % 100 % 100 % Revenue by contract type was as follows: Training and Simulation Division Power Systems Division Six months ended June 30, 2018 Fixed Price $ 24,026,993 $ 18,434,482 Cost Reimbursement (Cost Plus) 2,609,275 1,254,891 Time and Materials 2,273,982 523,495 Total $ 28,910,250 $ 20,212,868 Six months ended June 30, 2017 Fixed Price $ 16,192,107 $ 19,579,303 Cost Reimbursement (Cost Plus) 3,085,524 2,488,635 Time and Materials 1,265,372 1,185,197 Total $ 20,543,003 $ 23,253,135 Three months ended June 30, 2018 Fixed Price $ 11,817,023 $ 6,362,314 Cost Reimbursement (Cost Plus) 1,270,325 866,142 Time and Materials 1,265,038 293,767 Total $ 14,352,386 $ 7,522,223 Three months ended June 30, 2017 Fixed Price $ 8,100,238 $ 9,320,184 Cost Reimbursement (Cost Plus) 1,688,258 1,657,623 Time and Materials 403,318 279,072 Total $ 10,191,814 $ 11,256,879 Each of these contract types presents advantages and disadvantages. Typically, the Company assumes more risk with fixed-price contracts. However, these types of contracts offer additional profits when the Company completes the work for less than originally estimated. Cost-reimbursement contracts generally subject the Company to lower risk. Accordingly, the associated base fees are usually lower than fees earned on fixed-price contracts. Under time and materials contracts, the Company’s profit may fluctuate if actual labor-hour costs vary significantly from the negotiated rates. Revenue by customer was as follows: Training and Simulation Division Power Systems Division Six months ended June 30, 2018 U.S. Government Department of Defense (DoD) $ 7,646,854 $ 1,342,356 Non-DoD 4,382,879 – Foreign Military Sales (FMS) 1,713,399 – Total U.S. Government 13,743,132 1,342,356 U.S. Commercial $ 11,802,062 $ 11,489,572 Non-U.S. Government 1,392,449 1,823,167 Non-U.S. Commercial 1,972,607 5,557,773 Total Revenue $ 28,910,250 $ 20,212,868 Six months ended June 30, 2017 U.S. Government Department of Defense (DoD) $ 4,471,505 $ 4,451,134 Non-DoD 5,441,742 – Foreign Military Sales (FMS) 407,544 – Total U.S. Government 10,320,791 4,451,134 U.S. Commercial $ 7,931,884 $ 7,398,600 Non-U.S. Government 1,318,417 5,622,098 Non-U.S. Commercial 971,911 5,781,303 Total Revenue $ 20,543,003 $ 23,253,135 Three months ended June 30, 2018 U.S. Government Department of Defense (DoD) $ 4,214,661 $ 830,144 Non-DoD 1,644,072 – Foreign Military Sales (FMS) 1,128,618 – Total U.S. Government 6,987,351 830,144 U.S. Commercial $ 5,773,064 $ 3,771,608 Non-U.S. Government 466,285 305,348 Non-U.S. Commercial 1,125,686 2,615,123 Total Revenue $ 14,352,386 $ 7,522,223 Three months ended June 30, 2017 U.S. Government Department of Defense (DoD) $ 2,184,600 $ 2,614,546 Non-DoD 2,678,874 – Foreign Military Sales (FMS) 119,173 – Total U.S. Government 4,982,647 2,614,546 U.S. Commercial $ 4,207,190 $ 3,185,338 Non-U.S. Government 714,649 2,447,937 Non-U.S. Commercial 287,328 3,009,058 Total Revenue $ 10,191,814 $ 11,256,879 Contract Balances. June 30, 2018 December 31, 2017 Training and Simulation Division Power Systems Division Training and Simulation Division Power Systems Division Unbilled Receivables – Current $ 8,271,826 $ 8,206,915 $ 7,263,461 $ 8,831,055 Deferred Revenues – Current (5,723,423 ) (1,325,252 ) (5,860,345 ) (917,968 ) Net Contract Assets and Liabilities: $ 2,548,403 $ 6,881,663 $ 1,403,116 $ 7,913,087 The $114,000 increase in the Company’s net contract assets (liabilities) from December 31, 2017 to June 30, 2018 was due to the timing of milestone payments on certain US Government and commercial contracts. During the six months ended June 30, 2018 and June 30, 2017, the Company recognized $3.8 million and $3.7 million in revenue related to the Company’s contract liabilities at December 31, 2017 and December 31, 2016, respectively. The Company did not record any provisions for impairment of its unbilled receivables during the six months ended June 30, 2018 or June 30, 2017, respectively. Trade Receivables Trade receivables include amounts billed and currently due from customers. The amounts are recorded at net estimated realizable value. The value of the Company’s trade receivables when appropriate includes an allowance for estimated uncollectible amounts. The Company calculates an allowance based on its history of write-offs, the assessment of customer creditworthiness, and the age of the outstanding receivables. As of June 30, 2018 and December 31, 2017, the Company’s trade receivables recorded in the consolidated balance sheets were $14.3 million and $19.3 million, respectively. The Company has not recorded any provisions for doubtful accounts and no reserves have been established at June 30, 2018 or December 31, 2017, respectively. The Company believes its exposure to concentrations of credit risk is limited due to the nature of its operations, where a significant number of its contracts are typically a customized customer specific solution. Contract Costs Certain eligible costs, typically incurred during the initial phases of the Company’s service contracts, are capitalized when the costs related directly to the contract, are expected to be recovered, and generate or enhance resources to be used in satisfying the performance obligation. These costs primarily consist of production design. If the carrying amount is not recoverable, an impairment loss is recognized. Practical Expedients and Exemptions The Company has elected the following practical expedients and exemptions as allowed under the new revenue guidance: Sales Commissions The Company has elected to expense its sales commissions when incurred because the amortization period is less than one year. These costs are recorded within selling and marketing expenses. Financing The Company has elected to not adjust the consideration for the effects of a significant financing component as the term of the majority of contracts is twelve months or less. Sales Tax The Company acts as an agent in the collection and remittance of sales taxes. Historically, the Company has excluded these amounts from the calculation of revenue. These taxes will continue to be excluded from the transaction price. Shipping and Handling Costs The Company has elected to account for shipping and handling activities that are incurred after the customer obtained control of the product as fulfillment costs rather than a separate service provided to the customer for which consideration would need to be allocated. The Company will continue to account for shipping and handling as fulfillment costs when these costs are incurred prior to the customer obtaining control.

NOTE 3_ INVENTORIES

NOTE 3: INVENTORIES	6 Months Ended
	Jun. 30, 2018
Inventory Disclosure [Abstract]
Inventory Disclosure [Text Block]	NOTE 3: INVENTORIES Inventories are stated at the lower of cost or net realizable value. Cost is determined by the first in, first out (“FIFO”) method. The Company periodically evaluates the quantities on hand relative to current and historical selling prices and historical and projected sales volume and based on these evaluations, provisions are made in each period to write down inventory to its net realizable value. For the six months ended June 30, 2018 and 2017, the Company wrote off approximately $218,000 and $31,000, respectively, of obsolete inventory, which has been included in the cost of revenues. Inventories by component are as follows: June 30, 2018 December 31, 2017 Raw and packaging materials $ 6,879,620 $ 6,843,479 Work in progress 2,368,636 718,085 Finished products 539,690 1,093,314 Total: $ 9,787,946 $ 8,654,878

NOTE 4_ SEGMENT INFORMATION

NOTE 4: SEGMENT INFORMATION	6 Months Ended
	Jun. 30, 2018
Segment Reporting [Abstract]
Segment Reporting Disclosure [Text Block]	NOTE 4: SEGMENT INFORMATION a. The Company and its subsidiaries operate in two business segments. The two segments are also treated by the Company as reporting units for goodwill impairment evaluation purposes. The goodwill amounts associated with the Training and Simulation Division and the Power Systems Division were determined and valued when the specific businesses were purchased. The Company and its subsidiaries operate in two continuing business segments and follow the requirements of FASB ASC 280-10. The Company’s reportable segments have been determined in accordance with the Company’s internal management structure, which is organized based on operating activities. The accounting policies of the reportable segments are the same as those used by the Company in the preparation of its annual financial statements. The Company evaluates performance based on two primary factors, one is the segment’s operating income and the other is the segment’s contribution to the Company’s future strategic growth. b. The following is information about reported segment revenues, income (losses) from operations, and total assets as of June 30, 2018 and 2017: Training and Simulation Division Power Systems Division Corporate Expenses Total Company Six months ended June 30, 2018 Revenues from outside customers $ 28,910,250 $ 20,212,868 $ – $ 49,123,118 Depreciation, amortization and impairment expenses (1) (397,140 ) (1,470,159 ) – (1,867,299 ) Direct expenses (2) (22,837,678 ) (20,928,285 ) $ (1,864,513 ) (45,630,476 ) Segment operating income (loss) $ 5,675,432 $ (2,185,576 ) $ (1,864,513 ) $ 1,625,343 Financial expense (138,978 ) (3,392 ) (380,517 ) (522,887 ) Income tax expense (61,551 ) – (361,834 ) (423,385 ) Net income (loss) $ 5,474,903 $ (2,188,968 ) $ (2,606,864 ) $ 679,071 Segment assets (3) $ 52,169,769 $ 58,798,604 $ 3,404,904 $ 114,373,277 Additions to long-lived assets $ 469,436 $ 427,044 $ – $ 896,480 Six months ended June 30, 2017 Revenues from outside customers $ 20,543,003 $ 23,253,135 $ – $ 43,796,138 Depreciation, amortization and impairment expenses (1) (548,125 ) (1,531,811 ) (2,272 ) (2,082,208 ) Direct expenses (2) (18,050,604 ) (22,155,430 ) $ (1,839,027 ) (42,045,061 ) Segment operating income (loss) $ 1,944,274 $ (434,106 ) $ (1,841,299 ) $ (331,131 ) Financial expense (37,270 ) (177,748 ) (334,026 ) (549,044 ) Income tax benefit (expense) (70,000 ) 44,512 (457,272 ) (482,760 ) Net income (loss) $ 1,837,004 $ (567,342 ) $ (2,632,597 ) $ (1,362,935 Segment assets (3) $ 45,133,954 $ 59,898,807 $ 3,288,523 $ 108,321,284 Additions to long-lived assets $ 2,356,724 $ 926,946 $ – $ 3,283,670 Three months ended June 30, 2018 Revenues from outside customers $ 14,352,386 $ 7,522,223 $ – $ 21,874,609 Depreciation, amortization and impairment expenses (1) (196,780 ) (674,117 ) – (870,897 ) Direct expenses (2) (10,965,447 ) (8,654,573 ) (814,160 ) (20,434,180 ) Segment operating income (loss) $ 3,190,159 $ (1,806,467 ) $ (814,160 ) $ 569,532 Financial expense (94,359 ) (18,857 ) (196,563 ) (309,779 ) Income tax expense (41,750 ) – (134,521 ) (176,271 ) Net income (loss) $ 3,054,050 $ (1,825,324 ) $ (1,145,244 ) $ 83,482 Three months ended June 30, 2017 Revenues from outside customers $ 10,191,814 $ 11,256,879 $ – $ 21,448,693 Depreciation, amortization and impairment expenses (1) (277,461 ) (686,100 ) (1,184 ) (964,745 ) Direct expenses (2) (8,672,907 ) (11,064,098 ) (863,563 ) (20,600,568 ) Segment operating income (loss) $ 1,241,446 $ (493,319 ) $ (864,747 ) $ (116,620 ) Financial expense (24,602 ) (27,601 ) (162,984 ) (215,187 ) Income tax expense (35,000 ) 816 (228,636 ) (262,820 ) Net income (loss) $ 1,181,844 $ (520,104 ) $ (1,256,367 ) $ (594,627 ) (1) Includes depreciation of property and equipment and amortization expenses of intangible assets. (2) Including, inter alia (3) Out of those amounts, goodwill in the Company’s Training and Simulation Division and Power Systems Division totaled $24,435,641 and $21,702,395, respectively, as of June 30, 2018 and $24,435,641 and $21,647,674, respectively, as of June 30, 2017.

NOTE 5_ FAIR VALUE MEASUREMENT

NOTE 5: FAIR VALUE MEASUREMENT	6 Months Ended
	Jun. 30, 2018
Fair Value Disclosures [Abstract]
Fair Value Disclosures [Text Block]	NOTE 5: FAIR VALUE MEASUREMENT The carrying value of short term assets and liabilities in the accompanying condensed consolidated balance sheets for cash and cash equivalents, restricted collateral deposits, trade receivables, unbilled receivables, inventories, prepaid and other assets, trade payables, accrued expenses, deferred revenues and other liabilities as of June 30, 2018 and December 31, 2017, approximate fair value because of the short maturity of these instruments. The carrying amounts of long term debt approximates the estimated fair values at June 30, 2018, based upon the Company’s ability to acquire similar debt at similar maturities.

NOTE 6_ BANK FINANCING

NOTE 6: BANK FINANCING	6 Months Ended
	Jun. 30, 2018
Debt Disclosure [Abstract]
Debt Disclosure [Text Block]	NOTE 6: BANK FINANCING The Company maintains credit facilities with JPMorgan Chase Bank, N.A. (“Chase”), whereby Chase provides (i) a $15,000,000 revolving credit facility (“Revolver”), (ii) a $10,000,000 Term Loan (“Term Loan A”), (iii) a $1,730,895 Mortgage Loan (“Term Loan B”) and (iv) a $1,358,000 Mortgage Loan (“Term Loan C”); collectively referred to as the “Credit Facilities.” The maturity of the Revolver is March 11, 2021. The Revolver maintains an interest rate on a scale ranging from LIBOR plus 1.75% up to LIBOR plus 3.00%. The effective interest rate for the revolver at June 30, 2018 was 5.25%. The balance at June 30, 2018 and December 31, 2017 was $5.6 million and $5.1 million, respectively. The maturity of the Term Loan A is March 11, 2021. Term Loan A maintains an interest rate on a scale ranging from LIBOR plus 2.0% up to LIBOR plus 3.25%. The repayment of Term Loan A consists of 60 consecutive monthly payments of principal plus accrued interest based on annual principal reductions of 10% during the first year, 20% during the second through fourth years, and 30% during the fifth year. The effective interest rate for the Term Loan at June 30, 2018 was 5.50%. The balance at June 30, 2018 and December 31, 2017 was $6.7 million and $7.7 million, respectively. During the quarter ended June 30, 2017, the Company purchased land and a building, previously leased by its Training and Simulation Division, in Ann Arbor, Michigan. As a result, the Company now maintains two Mortgage Loans (“Term Loans B and C”). The maturities of Term Loans B and C are June 1, 2024 and maintain an interest rate on a scale identical to Term Loan A. The monthly payments on Term Loan B and Term Loan C are $7,212 and $5,660, respectively, in principal plus accrued interest, with balloon payments due on the maturity date. The effective interest rate for the Mortgage Loans at June 30, 2018 was 5.50%. The balance of both loans at June 30, 2018 and December 31, 2017 was $2.9 million and $3.1 million, respectively. The Credit Facilities maintain certain reporting requirements, conditions precedent, affirmative covenants and financial covenants. The Company is required to maintain certain financial covenants that include a Maximum Debt to EBITDA ratio of 3.00 to 1.00 and a Minimum Fixed Charge Coverage Ratio of 1.20 to 1.00. The Company was in compliance with its covenants at June 30, 2018. The Credit Facilities are secured by the Company’s assets and the assets of the Company’s domestic subsidiaries.

Accounting Policies, by Policy

Accounting Policies, by Policy (Policies)	6 Months Ended
	Jun. 30, 2018
Accounting Policies [Abstract]
Basis of Accounting, Policy [Policy Text Block]	Basis of Presentation: The Company prepared the accompanying unaudited condensed consolidated financial statements of Arotech Corporation and all wholly-owned, majority owned or otherwise controlled subsidiaries on the same basis as its annual audited financial statements. The Company condensed or omitted certain information and footnote disclosures normally included in its annual audited financial statements, which it prepared in accordance with U.S. Generally Accepted Accounting Principles (GAAP), with the instructions to Form 10-Q and with Article 10 of Regulation S-X, and include the accounts of Arotech Corporation and its subsidiaries. The Company’s quarterly financial statements should be read in conjunction with its Annual Report on Form 10-K for the year ended December 31, 2017. In the opinion of the Company, the unaudited financial statements reflect all adjustments (consisting only of normal recurring adjustments) necessary for a fair presentation of its financial position at June 30, 2018, its operating results for the six and three-month periods ended June 30, 2018 and 2017, and its cash flows for the six-month periods ended June 30, 2018 and 2017. The results of operations for the six and three months ended June 30, 2018 are not necessarily indicative of results that may be expected for any other interim period or for the full fiscal year ending December 31, 2018. The condensed consolidated balance sheet at December 31, 2017 has been derived from the audited financial statements at that date but does not include all the information and footnotes required by generally accepted accounting principles for complete financial statements. These condensed consolidated financial statements should be read in conjunction with the audited financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2017.
Reclassification, Policy [Policy Text Block]	Reclassification: From time to time the Company may reclassify amounts from prior periods to conform to current year’s presentation.
Commitments and Contingencies, Policy [Policy Text Block]	Commitments and contingencies: The Company is involved in litigation from time to time in the regular course of its business. There are no material legal proceedings pending or known by the Company to be contemplated to which the Company is a party or to which any of its property is subject. In addition, the Company believes that adequate provisions for resolution of all contingencies have been made for probable losses that are reasonably estimable. These contingencies are subject to uncertainties, and, as a result, the Company is unable to estimate the amount or range of loss, if any, in excess of amounts accrued. The Company does not believe that the these contingencies will have a material adverse effect on the Company’s balance sheets, statements of operations and comprehensive income or statements of cash flows for the period and six months ended June 30, 2018.
Goodwill and Intangible Assets, Goodwill, Policy [Policy Text Block]	Goodwill and other long-lived assets: Goodwill and indefinite-lived intangible assets are tested for impairment at least annually and between annual tests in certain circumstances, and written down when impaired. Goodwill is tested for impairment by comparing the fair value of the Company’s reporting units with the carrying value. The Training and Simulation and the Power Systems reporting units have goodwill. As of its last annual impairment test at December 31, 2017, the Company determined that the goodwill for both reporting units was not impaired. Consistent with previous interim reporting periods, the Company monitors qualitative and quantitative factors, including internal projections, periodic forecasts, and actual results of the reporting unit. Based upon this interim review, the Company does not believe that goodwill or its indefinite-lived intangible assets related to either reporting unit is impaired.
New Accounting Pronouncements, Policy [Policy Text Block]	New accounting pronouncements: In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) Codification Improvement to Topic 842 In July 2018, the FASB issued ASU No. 2018-11, Targeted Improvements to Topic 842. This amendment provides the Company with an additional and optional transition method to adopt the new leases standard. Under this new transition method, the Company can apply the new lease standard at the adoption date and recognize a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption and present the accounting on a prospective or go-forward basis instead of applying to the earliest comparative period presented in the financial statements. The Company expects to adopt using the optional transition method effective January 1, 2019. The Company is currently evaluating the potential changes from this ASU on its financial reporting, disclosures and impact to its processes and controls. The Company expects that the ROU asset and lease liability amounts recognized in the balance sheets will be material but does not expect it to have a material impact on its results of operations or liquidity.
Foreign Currency Transactions and Translations Policy [Policy Text Block]	Functional Currency: The United States dollar (“U.S. dollar”) is the currency of the primary economic environment in which the Company’s U.S. subsidiaries operate and the Company has adopted and are using the U.S. dollar as its functional currency. Transactions and balances originally denominated in U.S. dollars are presented at the original amounts. Accordingly, monetary accounts maintained in currencies other than dollars are re-measured into dollars, with resulting gains and losses reflected in the consolidated statements of operations and comprehensive income as financial income or expenses, as appropriate. In the first quarter of 2018, the Company concluded that the functional currency for its Israeli subsidiary, Epsilor-EFL, changed from the New Israeli Shekel (“NIS”) to the U.S. dollar. The primary reason for the change in functional currencies is due to a change in Epsilor-EFL operations whereby the majority of its contracts and material costs are anticipated to be sourced in U.S. dollars. The Company believes that the change in functional currency for this business was necessary as it reflects the primary economic environment in which Epsilor-EFL now operates. The change in functional currency for Epsilor-EFL is accounted for prospectively from January 1, 2018, and prior year financial statements have not been restated for the change in functional currency. The financial statements of Epsilor-EFL are now reported in U.S. dollars. All balance sheet accounts were translated using the exchange rates in effect at the time of the change in functional currency. The statements of comprehensive income and cash flows are also reported in U.S. dollars.
Income Tax, Policy [Policy Text Block]	Income Taxes: The U.S. Tax Cuts and Jobs Act (“Tax Act”) was enacted on December 22, 2017. The Tax Act makes broad complex changes to the U.S. tax code including, but not limited to, reducing the U.S. federal corporate tax rate from 35% to 21%, requiring companies to pay a one-time transition tax on earnings of certain foreign subsidiaries that were previously tax deferred, and creating new taxes on certain foreign sourced earnings and additional limitations on the deductibility of interest. The SEC issued Staff Accounting Bulletin No. 118 (SAB 118) in December, 2017, to provide guidance on accounting for the effects of the Tax Act. SAB 118 provides for a measurement period of up to one year from the Tax Act enactment date for companies to complete their assessment of and accounting for those effects of the Tax Act. Under SAB 118, a company must first reflect the income tax effects of the Tax Act for which the accounting is complete in the period of the date of enactment. To the extent the accounting for other income tax effects is incomplete, but a reasonable estimate can be determined, companies must record a provisional estimate to be included in their financial statements. For any income tax effect for which a reasonable estimate cannot be determined, an entity must continue to apply ASC 740 based on the provisions of the tax laws in effect immediately prior to the Tax Act being enacted until such time as a reasonable estimate can be determined. The Company requires additional time to complete its analysis of the impacts of the Tax Act and therefore its accounting for the Tax Act is provisional but is a reasonable estimate based on available information. The Company will complete its analysis and finalize its accounting for this provisional estimate during the one year measurement period as prescribed by SAB 118.
Revenue from Contract with Customer [Policy Text Block]	Revenue recognition: In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers, as a new Topic, ASC 606. The new revenue recognition standard relates to revenue from contracts with customers, which, along with amendments issued in 2016 and 2015, supersedes nearly all current U.S. GAAP guidance on this topic and eliminates industry-specific guidance. The Company accounts for revenue in accordance with ASC 606, Revenue from Contracts with Customers, which the Company adopted on January 1, 2018, using the modified retrospective method. The Company evaluated the distinct performance obligations and the pattern of revenue recognition of its significant contracts upon adoption of the standard. Consequently, after its review of contracts in each revenue stream, the Company concluded that the impact of adopting the standard did not have an impact to its consolidated balance sheets, statements of operations, changes in stockholders’ equity, or cash flows. During 2018 and 2017, the Company recognized revenues from (i) the sale and customization of interactive training systems (Training and Simulation Division); (ii) maintenance services in connection with such systems (Training and Simulation Division); (iii) the sale of batteries, chargers and adapters, and custom power solutions (Power Systems Division); and (iv) the sale of lifejacket lights (Power Systems Division). The Company determines its revenue recognition through the following steps: · Identification of the contract, or contracts, with a customer · Identification of the performance obligations within the contract · Determination of the transaction price · Allocation of the transaction price to the performance obligations within the contract · Recognition of revenue when, or as the performance obligation has been satisfied
Revenue, Remaining Performance Obligation, Provision for Loss [Policy Text Block]	Performance Obligations. The Company also offers maintenance and support agreements (“warranties”) for many of its products. The specific terms and conditions of those warranties vary depending upon the product sold and country in which the product was sold. The warranty revenue is recognized on a straight-line basis over the term of the maintenance and support services. The standalone selling price is determined based on the price charged when sold separately or upon renewal. The Company’s performance obligations are satisfied over time as work progresses or at a point in time. Revenue from products and services transferred to customers over time accounted for 93% percent and 92% percent of its revenue for the six-month periods ended June 30, 2018, and June 30, 2017, respectively. Substantially all of the Company’s revenue in the Training and Simulation Division and the U.S. Power Systems Division is recognized over time. Typically, revenue is recognized over time using an input measure (e.g., costs incurred to date relative to total estimated costs at completion) to measure progress. Contract costs include labor, material, and overhead. On June 30, 2018, the Company had $65.9 million of expected future revenue relating to performance obligations currently in progress, which it also refers to as total backlog. The Company expects to recognize approximately 51% percent of its backlog as revenue in 2018, and the remaining 49% percent by the end of 2019 and thereafter.
Revenue Recognition, Long-term Contracts [Policy Text Block]	Contract Estimates. Contract estimates are based on various assumptions to project the outcome of future events that can exceed a year. These assumptions include labor productivity and availability; the complexity of the work to be performed; the cost and availability of materials; the performance of subcontractors; and the availability and timing of funding from the customer. As a significant change in one or more of these estimates could affect the profitability of its contracts, the Company reviews and updates its contract-related estimates quarterly. The Company recognizes adjustments in estimated profit on contracts under the cumulative catch-up method. Under this method, the impact of the adjustment on profit recorded to date is recognized in the period the adjustment is identified. Revenue and profit in future periods of contract performance is recognized using the adjusted estimate. If at any time the estimate of contract profitability indicates an anticipated loss on the contract, the Company recognizes the total loss in the quarter it is identified. The aggregate impact of adjustments in contract estimates to net income (loss) are presented below: Six months ended June 30, 2018 Six months ended June 30, 2017 Training and Simulation Division Power Systems Division Training and Simulation Division Power Systems Division Net income (loss) $ 588,596 $ (242,866 ) $ 456,188 $ 300,911 Three months ended June 30, 2018 Three months ended June 30, 2017 Training and Simulation Division Power Systems Division Training and Simulation Division Power Systems Division Net income (loss) $ 517,156 $ (123,088 ) $ 175,558 $ (361,190 )
Revenue by Category, Policy [Policy Text Block]	Revenue by Category. Revenue by major product line was as follows: Six months ended June 30, Three months ended June 30, 2018 2017 2018 2017 Product Revenue Air Warfare Simulation $ 9,657,370 $ 9,401,852 $ 4,624,711 $ 5,078,038 Vehicle Simulation 10,999,632 4,343,349 5,535,633 1,482,707 Use-of-Force 6,545,553 5,146,413 3,285,505 2,808,298 Service Revenue Warranty 1,707,695 1,651,389 906,537 822,771 Total Training and Simulation Division $ 28,910,250 $ 20,543,003 $ 14,352,386 $ 10,191,814 Contract Manufacturing $ 7,030,011 $ 6,450,886 $ 2,865,685 $ 3,838,314 Power Distribution and Generation 4,281,921 2,330,552 1,006,541 1,301,600 Batteries 6,649,514 11,189,348 2,503,403 5,301,162 Engineering Services and Other 2,251,422 3,282,349 1,146,594 815,803 Total Power Division $ 20,212,868 $ 23,253,135 $ 7,522,223 $ 11,256,879 The table below details the percentage of total recognized revenue by type of arrangement for the six and three months ended June 30, 2018 and 2017: Six months ended June 30, Three months ended June 30, Type of Revenue 2018 2017 2018 2017 Sale of products 95.3 % 96.2 % 92.2 % 96.2 % Maintenance and support agreements 3.4 % 3.8 % 4.1 % 3.8 % Long term research and development contracts 1.3 % – 3.7 % – Total 100 % 100 % 100 % 100 % Revenue by contract type was as follows: Training and Simulation Division Power Systems Division Six months ended June 30, 2018 Fixed Price $ 24,026,993 $ 18,434,482 Cost Reimbursement (Cost Plus) 2,609,275 1,254,891 Time and Materials 2,273,982 523,495 Total $ 28,910,250 $ 20,212,868 Six months ended June 30, 2017 Fixed Price $ 16,192,107 $ 19,579,303 Cost Reimbursement (Cost Plus) 3,085,524 2,488,635 Time and Materials 1,265,372 1,185,197 Total $ 20,543,003 $ 23,253,135 Three months ended June 30, 2018 Fixed Price $ 11,817,023 $ 6,362,314 Cost Reimbursement (Cost Plus) 1,270,325 866,142 Time and Materials 1,265,038 293,767 Total $ 14,352,386 $ 7,522,223 Three months ended June 30, 2017 Fixed Price $ 8,100,238 $ 9,320,184 Cost Reimbursement (Cost Plus) 1,688,258 1,657,623 Time and Materials 403,318 279,072 Total $ 10,191,814 $ 11,256,879 Each of these contract types presents advantages and disadvantages. Typically, the Company assumes more risk with fixed-price contracts. However, these types of contracts offer additional profits when the Company completes the work for less than originally estimated. Cost-reimbursement contracts generally subject the Company to lower risk. Accordingly, the associated base fees are usually lower than fees earned on fixed-price contracts. Under time and materials contracts, the Company’s profit may fluctuate if actual labor-hour costs vary significantly from the negotiated rates. Revenue by customer was as follows: Training and Simulation Division Power Systems Division Six months ended June 30, 2018 U.S. Government Department of Defense (DoD) $ 7,646,854 $ 1,342,356 Non-DoD 4,382,879 – Foreign Military Sales (FMS) 1,713,399 – Total U.S. Government 13,743,132 1,342,356 U.S. Commercial $ 11,802,062 $ 11,489,572 Non-U.S. Government 1,392,449 1,823,167 Non-U.S. Commercial 1,972,607 5,557,773 Total Revenue $ 28,910,250 $ 20,212,868 Six months ended June 30, 2017 U.S. Government Department of Defense (DoD) $ 4,471,505 $ 4,451,134 Non-DoD 5,441,742 – Foreign Military Sales (FMS) 407,544 – Total U.S. Government 10,320,791 4,451,134 U.S. Commercial $ 7,931,884 $ 7,398,600 Non-U.S. Government 1,318,417 5,622,098 Non-U.S. Commercial 971,911 5,781,303 Total Revenue $ 20,543,003 $ 23,253,135 Three months ended June 30, 2018 U.S. Government Department of Defense (DoD) $ 4,214,661 $ 830,144 Non-DoD 1,644,072 – Foreign Military Sales (FMS) 1,128,618 – Total U.S. Government 6,987,351 830,144 U.S. Commercial $ 5,773,064 $ 3,771,608 Non-U.S. Government 466,285 305,348 Non-U.S. Commercial 1,125,686 2,615,123 Total Revenue $ 14,352,386 $ 7,522,223 Three months ended June 30, 2017 U.S. Government Department of Defense (DoD) $ 2,184,600 $ 2,614,546 Non-DoD 2,678,874 – Foreign Military Sales (FMS) 119,173 – Total U.S. Government 4,982,647 2,614,546 U.S. Commercial $ 4,207,190 $ 3,185,338 Non-U.S. Government 714,649 2,447,937 Non-U.S. Commercial 287,328 3,009,058 Total Revenue $ 10,191,814 $ 11,256,879
Long-Duration Contracts Revenue Recognition, Policy [Policy Text Block]	Contract Balances. June 30, 2018 December 31, 2017 Training and Simulation Division Power Systems Division Training and Simulation Division Power Systems Division Unbilled Receivables – Current $ 8,271,826 $ 8,206,915 $ 7,263,461 $ 8,831,055 Deferred Revenues – Current (5,723,423 ) (1,325,252 ) (5,860,345 ) (917,968 ) Net Contract Assets and Liabilities: $ 2,548,403 $ 6,881,663 $ 1,403,116 $ 7,913,087 The $114,000 increase in the Company’s net contract assets (liabilities) from December 31, 2017 to June 30, 2018 was due to the timing of milestone payments on certain US Government and commercial contracts. During the six months ended June 30, 2018 and June 30, 2017, the Company recognized $3.8 million and $3.7 million in revenue related to the Company’s contract liabilities at December 31, 2017 and December 31, 2016, respectively. The Company did not record any provisions for impairment of its unbilled receivables during the six months ended June 30, 2018 or June 30, 2017, respectively.
Trade and Other Accounts Receivable, Policy [Policy Text Block]	Trade Receivables Trade receivables include amounts billed and currently due from customers. The amounts are recorded at net estimated realizable value. The value of the Company’s trade receivables when appropriate includes an allowance for estimated uncollectible amounts. The Company calculates an allowance based on its history of write-offs, the assessment of customer creditworthiness, and the age of the outstanding receivables. As of June 30, 2018 and December 31, 2017, the Company’s trade receivables recorded in the consolidated balance sheets were $14.3 million and $19.3 million, respectively. The Company has not recorded any provisions for doubtful accounts and no reserves have been established at June 30, 2018 or December 31, 2017, respectively. The Company believes its exposure to concentrations of credit risk is limited due to the nature of its operations, where a significant number of its contracts are typically a customized customer specific solution.
Precontract Costs, Policy [Policy Text Block]	Contract Costs Certain eligible costs, typically incurred during the initial phases of the Company’s service contracts, are capitalized when the costs related directly to the contract, are expected to be recovered, and generate or enhance resources to be used in satisfying the performance obligation. These costs primarily consist of production design. If the carrying amount is not recoverable, an impairment loss is recognized.
Commissions Expense, Policy [Policy Text Block]	Sales Commissions The Company has elected to expense its sales commissions when incurred because the amortization period is less than one year. These costs are recorded within selling and marketing expenses.
Finance, Loans and Leases Receivable, Policy [Policy Text Block]	Financing The Company has elected to not adjust the consideration for the effects of a significant financing component as the term of the majority of contracts is twelve months or less.
Revenue, Transaction Price Measurement, Tax Exclusion [Policy Text Block]	Sales Tax The Company acts as an agent in the collection and remittance of sales taxes. Historically, the Company has excluded these amounts from the calculation of revenue. These taxes will continue to be excluded from the transaction price.
Shipping and Handling Cost, Policy [Policy Text Block]	Shipping and Handling Costs The Company has elected to account for shipping and handling activities that are incurred after the customer obtained control of the product as fulfillment costs rather than a separate service provided to the customer for which consideration would need to be allocated. The Company will continue to account for shipping and handling as fulfillment costs when these costs are incurred prior to the customer obtaining control.

NOTE 2_ SIGNIFICANT ACCOUNTIN13

NOTE 2: SIGNIFICANT ACCOUNTING POLICIES UPDATE (Tables)	6 Months Ended
	Jun. 30, 2018
Accounting Policies [Abstract]
Schedule of Adjustments in Contract Estimates [Table Text Block]	The aggregate impact of adjustments in contract estimates to net income (loss) are presented below: Six months ended June 30, 2018 Six months ended June 30, 2017 Training and Simulation Division Power Systems Division Training and Simulation Division Power Systems Division Net income (loss) $ 588,596 $ (242,866 ) $ 456,188 $ 300,911 Three months ended June 30, 2018 Three months ended June 30, 2017 Training and Simulation Division Power Systems Division Training and Simulation Division Power Systems Division Net income (loss) $ 517,156 $ (123,088 ) $ 175,558 $ (361,190 )
Revenue from External Customers by Products and Services [Table Text Block]	Revenue by major product line was as follows: Six months ended June 30, Three months ended June 30, 2018 2017 2018 2017 Product Revenue Air Warfare Simulation $ 9,657,370 $ 9,401,852 $ 4,624,711 $ 5,078,038 Vehicle Simulation 10,999,632 4,343,349 5,535,633 1,482,707 Use-of-Force 6,545,553 5,146,413 3,285,505 2,808,298 Service Revenue Warranty 1,707,695 1,651,389 906,537 822,771 Total Training and Simulation Division $ 28,910,250 $ 20,543,003 $ 14,352,386 $ 10,191,814 Contract Manufacturing $ 7,030,011 $ 6,450,886 $ 2,865,685 $ 3,838,314 Power Distribution and Generation 4,281,921 2,330,552 1,006,541 1,301,600 Batteries 6,649,514 11,189,348 2,503,403 5,301,162 Engineering Services and Other 2,251,422 3,282,349 1,146,594 815,803 Total Power Division $ 20,212,868 $ 23,253,135 $ 7,522,223 $ 11,256,879
Schedule of Principal Transactions Revenue [Table Text Block]	The table below details the percentage of total recognized revenue by type of arrangement for the six and three months ended June 30, 2018 and 2017: Six months ended June 30, Three months ended June 30, Type of Revenue 2018 2017 2018 2017 Sale of products 95.3 % 96.2 % 92.2 % 96.2 % Maintenance and support agreements 3.4 % 3.8 % 4.1 % 3.8 % Long term research and development contracts 1.3 % – 3.7 % – Total 100 % 100 % 100 % 100 %
Disaggregation of Revenue [Table Text Block]	Revenue by contract type was as follows: Training and Simulation Division Power Systems Division Six months ended June 30, 2018 Fixed Price $ 24,026,993 $ 18,434,482 Cost Reimbursement (Cost Plus) 2,609,275 1,254,891 Time and Materials 2,273,982 523,495 Total $ 28,910,250 $ 20,212,868 Six months ended June 30, 2017 Fixed Price $ 16,192,107 $ 19,579,303 Cost Reimbursement (Cost Plus) 3,085,524 2,488,635 Time and Materials 1,265,372 1,185,197 Total $ 20,543,003 $ 23,253,135 Three months ended June 30, 2018 Fixed Price $ 11,817,023 $ 6,362,314 Cost Reimbursement (Cost Plus) 1,270,325 866,142 Time and Materials 1,265,038 293,767 Total $ 14,352,386 $ 7,522,223 Three months ended June 30, 2017 Fixed Price $ 8,100,238 $ 9,320,184 Cost Reimbursement (Cost Plus) 1,688,258 1,657,623 Time and Materials 403,318 279,072 Total $ 10,191,814 $ 11,256,879
Schedule of Revenue by Major Customers by Reporting Segments [Table Text Block]	Revenue by customer was as follows: Training and Simulation Division Power Systems Division Six months ended June 30, 2018 U.S. Government Department of Defense (DoD) $ 7,646,854 $ 1,342,356 Non-DoD 4,382,879 – Foreign Military Sales (FMS) 1,713,399 – Total U.S. Government 13,743,132 1,342,356 U.S. Commercial $ 11,802,062 $ 11,489,572 Non-U.S. Government 1,392,449 1,823,167 Non-U.S. Commercial 1,972,607 5,557,773 Total Revenue $ 28,910,250 $ 20,212,868 Six months ended June 30, 2017 U.S. Government Department of Defense (DoD) $ 4,471,505 $ 4,451,134 Non-DoD 5,441,742 – Foreign Military Sales (FMS) 407,544 – Total U.S. Government 10,320,791 4,451,134 U.S. Commercial $ 7,931,884 $ 7,398,600 Non-U.S. Government 1,318,417 5,622,098 Non-U.S. Commercial 971,911 5,781,303 Total Revenue $ 20,543,003 $ 23,253,135 Three months ended June 30, 2018 U.S. Government Department of Defense (DoD) $ 4,214,661 $ 830,144 Non-DoD 1,644,072 – Foreign Military Sales (FMS) 1,128,618 – Total U.S. Government 6,987,351 830,144 U.S. Commercial $ 5,773,064 $ 3,771,608 Non-U.S. Government 466,285 305,348 Non-U.S. Commercial 1,125,686 2,615,123 Total Revenue $ 14,352,386 $ 7,522,223 Three months ended June 30, 2017 U.S. Government Department of Defense (DoD) $ 2,184,600 $ 2,614,546 Non-DoD 2,678,874 – Foreign Military Sales (FMS) 119,173 – Total U.S. Government 4,982,647 2,614,546 U.S. Commercial $ 4,207,190 $ 3,185,338 Non-U.S. Government 714,649 2,447,937 Non-U.S. Commercial 287,328 3,009,058 Total Revenue $ 10,191,814 $ 11,256,879
Contract with Customer, Asset and Liability [Table Text Block]	The timing of revenue recognition, billings and cash collections results in billed accounts receivable, unbilled receivables (contract assets), and customer advances and deposits (contract liabilities) on the Consolidated Balance Sheet. The majority of the Company’s contract amounts are billed as work progresses in accordance with agreed-upon contractual terms, either at periodic intervals (e.g., biweekly or monthly) or upon achievement of contractual milestones. Billing sometimes occurs subsequent to revenue recognition, resulting in contract assets. However, the Company sometimes receives advances or deposits from its customers, particularly on its international contracts, before revenue is recognized, resulting in contract liabilities. These assets and liabilities are reported on the Consolidated Balance Sheet on a contract-by-contract basis at the end of each reporting period. June 30, 2018 December 31, 2017 Training and Simulation Division Power Systems Division Training and Simulation Division Power Systems Division Unbilled Receivables – Current $ 8,271,826 $ 8,206,915 $ 7,263,461 $ 8,831,055 Deferred Revenues – Current (5,723,423 ) (1,325,252 ) (5,860,345 ) (917,968 ) Net Contract Assets and Liabilities: $ 2,548,403 $ 6,881,663 $ 1,403,116 $ 7,913,087

NOTE 3_ INVENTORIES (Tables)

NOTE 3: INVENTORIES (Tables)	6 Months Ended
	Jun. 30, 2018
Inventory Disclosure [Abstract]
Schedule of Inventory, Current [Table Text Block]	Inventories by component are as follows: June 30, 2018 December 31, 2017 Raw and packaging materials $ 6,879,620 $ 6,843,479 Work in progress 2,368,636 718,085 Finished products 539,690 1,093,314 Total: $ 9,787,946 $ 8,654,878

NOTE 4_ SEGMENT INFORMATION (Ta

NOTE 4: SEGMENT INFORMATION (Tables)	6 Months Ended
	Jun. 30, 2018
Segment Reporting [Abstract]
Schedule of Segment Reporting Information, by Segment [Table Text Block]	The following is information about reported segment revenues, income (losses) from operations, and total assets as of June 30, 2018 and 2017: Training and Simulation Division Power Systems Division Corporate Expenses Total Company Six months ended June 30, 2018 Revenues from outside customers $ 28,910,250 $ 20,212,868 $ – $ 49,123,118 Depreciation, amortization and impairment expenses (1) (397,140 ) (1,470,159 ) – (1,867,299 ) Direct expenses (2) (22,837,678 ) (20,928,285 ) $ (1,864,513 ) (45,630,476 ) Segment operating income (loss) $ 5,675,432 $ (2,185,576 ) $ (1,864,513 ) $ 1,625,343 Financial expense (138,978 ) (3,392 ) (380,517 ) (522,887 ) Income tax expense (61,551 ) – (361,834 ) (423,385 ) Net income (loss) $ 5,474,903 $ (2,188,968 ) $ (2,606,864 ) $ 679,071 Segment assets (3) $ 52,169,769 $ 58,798,604 $ 3,404,904 $ 114,373,277 Additions to long-lived assets $ 469,436 $ 427,044 $ – $ 896,480 Six months ended June 30, 2017 Revenues from outside customers $ 20,543,003 $ 23,253,135 $ – $ 43,796,138 Depreciation, amortization and impairment expenses (1) (548,125 ) (1,531,811 ) (2,272 ) (2,082,208 ) Direct expenses (2) (18,050,604 ) (22,155,430 ) $ (1,839,027 ) (42,045,061 ) Segment operating income (loss) $ 1,944,274 $ (434,106 ) $ (1,841,299 ) $ (331,131 ) Financial expense (37,270 ) (177,748 ) (334,026 ) (549,044 ) Income tax benefit (expense) (70,000 ) 44,512 (457,272 ) (482,760 ) Net income (loss) $ 1,837,004 $ (567,342 ) $ (2,632,597 ) $ (1,362,935 Segment assets (3) $ 45,133,954 $ 59,898,807 $ 3,288,523 $ 108,321,284 Additions to long-lived assets $ 2,356,724 $ 926,946 $ – $ 3,283,670 Three months ended June 30, 2018 Revenues from outside customers $ 14,352,386 $ 7,522,223 $ – $ 21,874,609 Depreciation, amortization and impairment expenses (1) (196,780 ) (674,117 ) – (870,897 ) Direct expenses (2) (10,965,447 ) (8,654,573 ) (814,160 ) (20,434,180 ) Segment operating income (loss) $ 3,190,159 $ (1,806,467 ) $ (814,160 ) $ 569,532 Financial expense (94,359 ) (18,857 ) (196,563 ) (309,779 ) Income tax expense (41,750 ) – (134,521 ) (176,271 ) Net income (loss) $ 3,054,050 $ (1,825,324 ) $ (1,145,244 ) $ 83,482 Three months ended June 30, 2017 Revenues from outside customers $ 10,191,814 $ 11,256,879 $ – $ 21,448,693 Depreciation, amortization and impairment expenses (1) (277,461 ) (686,100 ) (1,184 ) (964,745 ) Direct expenses (2) (8,672,907 ) (11,064,098 ) (863,563 ) (20,600,568 ) Segment operating income (loss) $ 1,241,446 $ (493,319 ) $ (864,747 ) $ (116,620 ) Financial expense (24,602 ) (27,601 ) (162,984 ) (215,187 ) Income tax expense (35,000 ) 816 (228,636 ) (262,820 ) Net income (loss) $ 1,181,844 $ (520,104 ) $ (1,256,367 ) $ (594,627 ) (1) Includes depreciation of property and equipment and amortization expenses of intangible assets. (2) Including, inter alia (3) Out of those amounts, goodwill in the Company’s Training and Simulation Division and Power Systems Division totaled $24,435,641 and $21,702,395, respectively, as of June 30, 2018 and $24,435,641 and $21,647,674, respectively, as of June 30, 2017.

NOTE 2_ SIGNIFICANT ACCOUNTIN16

NOTE 2: SIGNIFICANT ACCOUNTING POLICIES UPDATE (Details) - USD ($)	Dec. 22, 2017	Jun. 30, 2018	Jun. 30, 2017	Dec. 31, 2017
NOTE 2: SIGNIFICANT ACCOUNTING POLICIES UPDATE (Details) [Line Items]
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent	21.00%			35.00%
Revenue, Remaining Performance Obligation, Amount		$ 65,900,000
Increase (Decrease) in Net Contract Assets and Liabilities		114,000
Contract with Customer, Liability, Revenue Recognized		3,800,000	$ 3,700,000
Accounts Receivable, Net, Current		$ 14,331,028		$ 19,258,960
To Be Recognized as Revenue in 2018 [Member]
NOTE 2: SIGNIFICANT ACCOUNTING POLICIES UPDATE (Details) [Line Items]
Revenue, Remaining Performance Obligation, Percentage		51.00%
To Be Recognized as Revenue by End of 2019 [Member]
NOTE 2: SIGNIFICANT ACCOUNTING POLICIES UPDATE (Details) [Line Items]
Revenue, Remaining Performance Obligation, Percentage		49.00%
Customer Concentration Risk [Member] | Sales Revenue, Services, Net [Member]
NOTE 2: SIGNIFICANT ACCOUNTING POLICIES UPDATE (Details) [Line Items]
Revenue, Remaining Performance Obligation, Percentage		93.00%	92.00%

NOTE 2_ SIGNIFICANT AC

NOTE 2: SIGNIFICANT ACCOUNTING POLICIES UPDATE (Details) - Schedule of Adjustments in Contract Estimates - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
NOTE 2: SIGNIFICANT ACCOUNTING POLICIES UPDATE (Details) - Schedule of Adjustments in Contract Estimates [Line Items]
Net income (loss)	$ 83,482	$ (594,627)	$ 679,071	$ (1,362,935)
Training and Simulation Division [Member]
NOTE 2: SIGNIFICANT ACCOUNTING POLICIES UPDATE (Details) - Schedule of Adjustments in Contract Estimates [Line Items]
Net income (loss)	517,156	175,558	588,596	456,188
Power Systems Division [Member]
NOTE 2: SIGNIFICANT ACCOUNTING POLICIES UPDATE (Details) - Schedule of Adjustments in Contract Estimates [Line Items]
Net income (loss)	$ (123,088)	$ (361,190)	$ (242,866)	$ 300,911

NOTE 2_ SIGNIFICANT 18

NOTE 2: SIGNIFICANT ACCOUNTING POLICIES UPDATE (Details) - Revenue from External Customers by Products and Services - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Revenue from External Customer [Line Items]
Revenue	$ 21,874,609	$ 21,448,693	$ 49,123,118	$ 43,796,138
Training and Simulation Division [Member]
Revenue from External Customer [Line Items]
Revenue	14,352,386	10,191,814	28,910,250	20,543,003
Power Systems Division [Member]
Revenue from External Customer [Line Items]
Revenue	7,522,223	11,256,879	20,212,868	23,253,135
Air Warfare Simulation [Member] | Training and Simulation Division [Member]
Revenue from External Customer [Line Items]
Revenue	4,624,711	5,078,038	9,657,370	9,401,852
Commercial Vehicle [Member] | Training and Simulation Division [Member]
Revenue from External Customer [Line Items]
Revenue	5,535,633	1,482,707	10,999,632	4,343,349
Use-of-Force [Member] | Training and Simulation Division [Member]
Revenue from External Customer [Line Items]
Revenue	3,285,505	2,808,298	6,545,553	5,146,413
Warranty [Member] | Training and Simulation Division [Member]
Revenue from External Customer [Line Items]
Revenue	906,537	822,771	1,707,695	1,651,389
Contract Manufacturing [Member] | Power Systems Division [Member]
Revenue from External Customer [Line Items]
Revenue	2,865,685	3,838,314	7,030,011	6,450,886
Power Distribution and Generation [Member] | Power Systems Division [Member]
Revenue from External Customer [Line Items]
Revenue	1,006,541	1,301,600	4,281,921	2,330,552
Israel Medical and Commercial [Member] | Power Systems Division [Member]
Revenue from External Customer [Line Items]
Revenue	2,503,403	5,301,162	6,649,514	11,189,348
Engineering Services and Other [Member] | Power Systems Division [Member]
Revenue from External Customer [Line Items]
Revenue	$ 1,146,594	$ 815,803	$ 2,251,422	$ 3,282,349

NOTE 2_ SIGNIFICANT 19

NOTE 2: SIGNIFICANT ACCOUNTING POLICIES UPDATE (Details) - Schedule of Principal Transactions Revenue	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Principal Transaction Revenue [Line Items]
Revenue by type of arrangement	100.00%	100.00%	100.00%	100.00%
Sale of Products [Member]
Principal Transaction Revenue [Line Items]
Revenue by type of arrangement	92.20%	96.20%	95.30%	96.20%
Maintenance and Support Agreements [Member]
Principal Transaction Revenue [Line Items]
Revenue by type of arrangement	4.10%	3.80%	3.40%	3.80%
Long Term Research and Development Contracts [Member]
Principal Transaction Revenue [Line Items]
Revenue by type of arrangement	3.70%	0.00%	1.30%	0.00%

NOTE 2_ SIGNIFICANT 20

NOTE 2: SIGNIFICANT ACCOUNTING POLICIES UPDATE (Details) - Disaggregation of Revenue - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Disaggregation of Revenue [Line Items]
Revenue by Contract	$ 21,874,609	$ 21,448,693	$ 49,123,118	$ 43,796,138
Training and Simulation Division [Member]
Disaggregation of Revenue [Line Items]
Revenue by Contract	14,352,386	10,191,814	28,910,250	20,543,003
Training and Simulation Division [Member] | Fixed-price Contract [Member]
Disaggregation of Revenue [Line Items]
Revenue by Contract	11,817,023	8,100,238	24,026,993	16,192,107
Training and Simulation Division [Member] | Cost Reimbursement [Member]
Disaggregation of Revenue [Line Items]
Revenue by Contract	1,270,325	1,688,258	2,609,275	3,085,524
Training and Simulation Division [Member] | Time-and-materials Contract [Member]
Disaggregation of Revenue [Line Items]
Revenue by Contract	1,265,038	403,318	2,273,982	1,265,372
Power Systems Division [Member]
Disaggregation of Revenue [Line Items]
Revenue by Contract	7,522,223	11,256,879	20,212,868	23,253,135
Power Systems Division [Member] | Fixed-price Contract [Member]
Disaggregation of Revenue [Line Items]
Revenue by Contract	6,362,314	9,320,184	18,434,482	19,579,303
Power Systems Division [Member] | Cost Reimbursement [Member]
Disaggregation of Revenue [Line Items]
Revenue by Contract	866,142	1,657,623	1,254,891	2,488,635
Power Systems Division [Member] | Time-and-materials Contract [Member]
Disaggregation of Revenue [Line Items]
Revenue by Contract	$ 293,767	$ 279,072	$ 523,495	$ 1,185,197

NOTE 2_ SIGNIFICANT 21

NOTE 2: SIGNIFICANT ACCOUNTING POLICIES UPDATE (Details) - Schedule of Revenue by Major Customers by Reporting Segments - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Revenue, Major Customer [Line Items]
Revenue by Customer	$ 21,874,609	$ 21,448,693	$ 49,123,118	$ 43,796,138
Training and Simulation Division [Member]
Revenue, Major Customer [Line Items]
Revenue by Customer	14,352,386	10,191,814	28,910,250	20,543,003
Training and Simulation Division [Member] | Department of Defense (DoD) [Member]
Revenue, Major Customer [Line Items]
Revenue by Customer	4,214,661	2,184,600	7,646,854	4,471,505
Training and Simulation Division [Member] | Non-DOD [Member]
Revenue, Major Customer [Line Items]
Revenue by Customer	1,644,072	2,678,874	4,382,879	5,441,742
Training and Simulation Division [Member] | Foreign Military Sales (FMS) [Member]
Revenue, Major Customer [Line Items]
Revenue by Customer	1,128,618	119,173	1,713,399	407,544
Training and Simulation Division [Member] | Major Customer, Government [Member]
Revenue, Major Customer [Line Items]
Revenue by Customer	6,987,351	4,982,647	13,743,132	10,320,791
Training and Simulation Division [Member] | U.S. Commercial [Member]
Revenue, Major Customer [Line Items]
Revenue by Customer	5,773,064	4,207,190	11,802,062	7,931,884
Training and Simulation Division [Member] | Non-U.S. Government [Member]
Revenue, Major Customer [Line Items]
Revenue by Customer	466,285	714,649	1,392,449	1,318,417
Training and Simulation Division [Member] | Non-U.S. Commercial [Member]
Revenue, Major Customer [Line Items]
Revenue by Customer	1,125,686	287,328	1,972,607	971,911
Power Systems Division [Member]
Revenue, Major Customer [Line Items]
Revenue by Customer	7,522,223	11,256,879	20,212,868	23,253,135
Power Systems Division [Member] | Department of Defense (DoD) [Member]
Revenue, Major Customer [Line Items]
Revenue by Customer	830,144	2,614,546	1,342,356	4,451,134
Power Systems Division [Member] | Non-DOD [Member]
Revenue, Major Customer [Line Items]
Revenue by Customer	0	0	0	0
Power Systems Division [Member] | Foreign Military Sales (FMS) [Member]
Revenue, Major Customer [Line Items]
Revenue by Customer	0	0	0	0
Power Systems Division [Member] | Major Customer, Government [Member]
Revenue, Major Customer [Line Items]
Revenue by Customer	830,144	2,614,546	1,342,356	4,451,134
Power Systems Division [Member] | U.S. Commercial [Member]
Revenue, Major Customer [Line Items]
Revenue by Customer	3,771,608	3,185,338	11,489,572	7,398,600
Power Systems Division [Member] | Non-U.S. Government [Member]
Revenue, Major Customer [Line Items]
Revenue by Customer	305,348	2,447,937	1,823,167	5,622,098
Power Systems Division [Member] | Non-U.S. Commercial [Member]
Revenue, Major Customer [Line Items]
Revenue by Customer	$ 2,615,123	$ 3,009,058	$ 5,557,773	$ 5,781,303

NOTE 2_ SIGNIFICANT 22

NOTE 2: SIGNIFICANT ACCOUNTING POLICIES UPDATE (Details) - Contract with Customer, Assets and Liabilities - USD ($)	Jun. 30, 2018	Dec. 31, 2017
Training and Simulation Division [Member]
NOTE 2: SIGNIFICANT ACCOUNTING POLICIES UPDATE (Details) - Contract with Customer, Assets and Liabilities [Line Items]
Unbilled Receivables – Current	$ 8,271,826	$ 7,263,461
Deferred Revenues – Current	(5,723,423)	(5,860,345)
Net Contract Assets and Liabilities:	2,548,403	1,403,116
Power Systems Division [Member]
NOTE 2: SIGNIFICANT ACCOUNTING POLICIES UPDATE (Details) - Contract with Customer, Assets and Liabilities [Line Items]
Unbilled Receivables – Current	8,206,915	8,831,055
Deferred Revenues – Current	(1,325,252)	(917,968)
Net Contract Assets and Liabilities:	$ 6,881,663	$ 7,913,087

NOTE 3_ INVENTORIES (Details)

NOTE 3: INVENTORIES (Details) - USD ($)	6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017
Inventory Disclosure [Abstract]
Inventory Write-down	$ 218,000	$ 31,000

NOTE 3_ IN

NOTE 3: INVENTORIES (Details) - Schedule of Inventory - USD ($)	Jun. 30, 2018	Dec. 31, 2017
Schedule of Inventory [Abstract]
Raw and packaging materials	$ 6,879,620	$ 6,843,479
Work in progress	2,368,636	718,085
Finished products	539,690	1,093,314
Total:	$ 9,787,946	$ 8,654,878

NOTE 4_ SEGMENT INFORMATION (De

NOTE 4: SEGMENT INFORMATION (Details)	6 Months Ended
	Jun. 30, 2018USD ($)	Dec. 31, 2017USD ($)	Jun. 30, 2017USD ($)
NOTE 4: SEGMENT INFORMATION (Details) [Line Items]
Number of Operating Segments	2
Goodwill	$ 46,138,036	$ 46,138,036
Training and Simulation Division [Member]
NOTE 4: SEGMENT INFORMATION (Details) [Line Items]
Goodwill	24,435,641		$ 24,435,641
Power Systems Division [Member]
NOTE 4: SEGMENT INFORMATION (Details) [Line Items]
Goodwill	$ 21,702,395		$ 21,647,674

NOTE 4_ SE

NOTE 4: SEGMENT INFORMATION (Details) - Schedule of Segment Reporting Information - USD ($)		3 Months Ended				6 Months Ended
		Jun. 30, 2018		Jun. 30, 2017		Jun. 30, 2018		Jun. 30, 2017		Dec. 31, 2017
Segment Reporting Information [Line Items]
Revenues from outside customers		$ 21,874,609		$ 21,448,693		$ 49,123,118		$ 43,796,138
Depreciation, amortization and impairment expenses	[1]	(870,897)		(964,745)		(1,867,299)		(2,082,208)
Direct expenses	[2]	(20,434,180)		(20,600,568)		(45,630,476)		(42,045,061)
Segment operating income (loss)		569,532		(116,620)		1,625,343		(331,131)
Financial income (expense)		(309,779)		(215,187)		(522,887)		(549,044)
Income tax benefit (expense)		(176,271)		(262,820)		(423,385)		(482,760)
Income (loss) from continuing operations		83,482		(594,627)		679,071		1,362,935
Segment assets		114,373,277	[3]	108,321,284	[3]	114,373,277	[3]	108,321,284	[3]	$ 116,398,176
Additions to long-lived assets						896,480		3,283,670
Training and Simulation Division [Member]
Segment Reporting Information [Line Items]
Revenues from outside customers		14,352,386		10,191,814		28,910,250		20,543,003
Depreciation, amortization and impairment expenses	[1]	(196,780)		(277,461)		(397,140)		(548,125)
Direct expenses	[2]	(10,965,447)		(8,672,907)		(22,837,678)		(18,050,604)
Segment operating income (loss)		3,190,159		1,241,446		5,675,432		1,944,274
Financial income (expense)		(94,359)		(24,602)		(138,978)		(37,270)
Income tax benefit (expense)		(41,750)		(35,000)		(61,551)		(70,000)
Income (loss) from continuing operations		3,054,050		1,181,844		5,474,903		1,837,004
Segment assets	[3]	52,169,769		45,133,954		52,169,769		45,133,954
Additions to long-lived assets						469,436		2,356,724
Power Systems Division [Member]
Segment Reporting Information [Line Items]
Revenues from outside customers		7,522,223		11,256,879		20,212,868		23,253,135
Depreciation, amortization and impairment expenses	[1]	(674,117)		(686,100)		(1,470,159)		(1,531,811)
Direct expenses	[2]	(8,654,573)		(11,064,098)		(20,928,285)		(22,155,430)
Segment operating income (loss)		(1,806,467)		(493,319)		(2,185,576)		(434,106)
Financial income (expense)		(18,857)		(27,601)		(3,392)		(177,748)
Income tax benefit (expense)		0		816		0		44,512
Income (loss) from continuing operations		(1,825,324)		(520,104)		(2,188,968)		(567,342)
Segment assets	[3]	58,798,604		59,898,807		58,798,604		59,898,807
Additions to long-lived assets						427,044		926,946
Corporate Segment [Member]
Segment Reporting Information [Line Items]
Revenues from outside customers		0		0		0		0
Depreciation, amortization and impairment expenses	[1]	0		(1,184)		0		(2,272)
Direct expenses	[2]	(814,160)		(863,563)		(1,864,513)		(1,839,027)
Segment operating income (loss)		(814,160)		(864,747)		(1,864,513)		(1,841,299)
Financial income (expense)		(196,563)		(162,984)		(380,517)		(334,026)
Income tax benefit (expense)		(134,521)		(228,636)		(361,834)		(457,272)
Income (loss) from continuing operations		(1,145,244)		(1,256,367)		(2,606,864)		(2,632,597)
Segment assets	[3]	$ 3,404,904		$ 3,288,523		3,404,904		3,288,523
Additions to long-lived assets						$ 0		$ 0
[1]	Includes depreciation of property and equipment and amortization expenses of intangible assets.
[2]	Including,inter alia, sales and marketing, general and administrative.
[3]	Out of those amounts, goodwill in the Company's Training and Simulation Division and Power Systems Division totaled $24,435,641 and $21,702,395, respectively, as of June 30, 2018 and $24,435,641 and $21,647,674, respectively, as of June 30, 2017.

NOTE 6_ BANK FINANCING (Details

NOTE 6: BANK FINANCING (Details) - USD ($)	6 Months Ended
	Jun. 30, 2018	Dec. 31, 2017
NOTE 6: BANK FINANCING (Details) [Line Items]
Short-term Debt	$ 5,571,024	$ 5,092,088
Revolving Credit Facility [Member]
NOTE 6: BANK FINANCING (Details) [Line Items]
Line of Credit Facility, Maximum Borrowing Capacity	$ 15,000,000
Line of Credit Facility, Expiration Date	Mar. 11, 2021
Line of Credit Facility, Interest Rate at Period End	5.25%
Line of Credit Facility, Covenant Terms	The Credit Facilities maintain certain reporting requirements, conditions precedent, affirmative covenants and financial covenants. The Company is required to maintain certain financial covenants that include a Maximum Debt to EBITDA ratio of 3.00 to 1.00 and a Minimum Fixed Charge Coverage Ratio of 1.20 to 1.00.
Line of Credit Facility, Collateral	The Credit Facilities are secured by the Company’s assets and the assets of the Company’s domestic subsidiaries.
Notes Payable to Banks [Member]
NOTE 6: BANK FINANCING (Details) [Line Items]
Debt Instrument, Face Amount	$ 10,000,000
Debt Instrument, Maturity Date	Mar. 11, 2021
Debt Instrument, Payment Terms	The repayment of Term Loan A consists of 60 consecutive monthly payments of principal plus accrued interest based on annual principal reductions of 10% during the first year, 20% during the second through fourth years, and 30% during the fifth year.
Debt Instrument, Interest Rate, Effective Percentage	5.50%
Other Long-term Debt, Noncurrent	$ 6,700,000	7,700,000
Mortgages [Member]
NOTE 6: BANK FINANCING (Details) [Line Items]
Debt Instrument, Maturity Date	Jun. 1, 2024
Debt Instrument, Payment Terms	The monthly payments on Term Loan B and Term Loan C are $7,212 and $5,660, respectively, in principal plus accrued interest, with balloon payments due on the maturity date.
Debt Instrument, Interest Rate, Effective Percentage	5.50%
Other Long-term Debt, Noncurrent	$ 2,900,000	$ 3,100,000
Number of Loans	2
Mortgages [Member] | Term Loan B [Member]
NOTE 6: BANK FINANCING (Details) [Line Items]
Debt Instrument, Face Amount	$ 1,730,895
Debt Instrument, Periodic Payment	7,212
Mortgages [Member] | Term Loan C [Member]
NOTE 6: BANK FINANCING (Details) [Line Items]
Debt Instrument, Face Amount	1,358,000
Debt Instrument, Periodic Payment	$ 5,660
London Interbank Offered Rate (LIBOR) [Member] | Minimum [Member] | Revolving Credit Facility [Member]
NOTE 6: BANK FINANCING (Details) [Line Items]
Debt Instrument, Basis Spread on Variable Rate	1.75%
London Interbank Offered Rate (LIBOR) [Member] | Minimum [Member] | Notes Payable to Banks [Member]
NOTE 6: BANK FINANCING (Details) [Line Items]
Debt Instrument, Basis Spread on Variable Rate	2.00%
London Interbank Offered Rate (LIBOR) [Member] | Maximum [Member] | Revolving Credit Facility [Member]
NOTE 6: BANK FINANCING (Details) [Line Items]
Debt Instrument, Basis Spread on Variable Rate	3.00%
London Interbank Offered Rate (LIBOR) [Member] | Maximum [Member] | Notes Payable to Banks [Member]
NOTE 6: BANK FINANCING (Details) [Line Items]
Debt Instrument, Basis Spread on Variable Rate	3.25%