Document_And_Entity_Informatio
Document And Entity Information (USD $) | 12 Months Ended | ||
Mar. 31, 2014 | Jun. 30, 2014 | Sep. 30, 2013 | |
Document Information [Line Items] | ' | ' | ' |
Entity Registrant Name | 'SINGING MACHINE CO INC | ' | ' |
Entity Central Index Key | '0000923601 | ' | ' |
Current Fiscal Year End Date | '--03-31 | ' | ' |
Entity Filer Category | 'Smaller Reporting Company | ' | ' |
Trading Symbol | 'SMDM | ' | ' |
Entity Common Stock, Shares Outstanding | ' | 38,070,642 | ' |
Document Type | '10-K | ' | ' |
Amendment Flag | 'false | ' | ' |
Document Period End Date | 31-Mar-14 | ' | ' |
Document Fiscal Period Focus | 'FY | ' | ' |
Document Fiscal Year Focus | '2014 | ' | ' |
Entity Well-known Seasoned Issuer | 'No | ' | ' |
Entity Voluntary Filers | 'No | ' | ' |
Entity Current Reporting Status | 'Yes | ' | ' |
Entity Public Float | ' | ' | $3,353,000 |
CONSOLIDATED_BALANCE_SHEETS
CONSOLIDATED BALANCE SHEETS (USD $) | Mar. 31, 2014 | Mar. 31, 2013 |
Current Assets | ' | ' |
Cash | $1,354,099 | $1,652,996 |
Restricted cash | 138,042 | 0 |
Accounts receivable, net of allowances of $172,465 and $180,306, respectively | 955,551 | 1,100,475 |
Due from Crestmark Bank | 19,638 | 0 |
Inventories, net | 5,827,613 | 4,123,407 |
Prepaid expenses and other current assets | 91,088 | 84,441 |
Deferred tax asset, net | 604,284 | 421,340 |
Total Current Assets | 9,357,835 | 7,785,813 |
Property and equipment, net | 561,225 | 482,777 |
Other non-current assets | 17,630 | 159,956 |
Deferred tax asset, net non-current portion | 1,793,972 | 1,198,119 |
Total Assets | 11,730,662 | 9,626,665 |
Current Liabilities | ' | ' |
Accounts payable | 1,918,076 | 1,135,125 |
Accrued expenses | 446,314 | 686,012 |
Current portion of capital lease | 12,076 | 0 |
Obligations to clients for returns and allowances | 469,838 | 376,289 |
Warranty provisions | 235,172 | 215,471 |
Total Current Liabilities | 8,007,458 | 4,528,834 |
Long-term capital lease, net of current portion | 13,706 | 0 |
Total Liabilities | 8,021,164 | 7,028,834 |
Shareholders' Equity | ' | ' |
Preferred stock, $1.00 par value; 1,000,000 shares authorized; no shares issued and outstanding | 0 | 0 |
Common stock value | 380,706 | 380,289 |
Additional paid-in capital | 19,262,127 | 19,155,193 |
Accumulated deficit | -15,933,335 | -16,937,651 |
Total Shareholders' Equity | 3,709,498 | 2,597,831 |
Total Liabilities and Shareholders' Equity | 11,730,662 | 9,626,665 |
Starlight Consumer Electronics USA, Inc [Member] | ' | ' |
Current Assets | ' | ' |
Due from related party | 233,004 | 291,343 |
Starlight Electronics USA, Inc [Member] | ' | ' |
Current Assets | ' | ' |
Due from related party | 51,196 | 50,501 |
Starlight Electronics Co., Ltd [Member] | ' | ' |
Current Assets | ' | ' |
Due from related party | 83,320 | 0 |
Cosmo Communications Canada, Ltd [Member] | ' | ' |
Current Assets | ' | ' |
Due from related party | 0 | 61,310 |
Current Liabilities | ' | ' |
Due to related party | 50,441 | 0 |
Starlight Marketing Development, Ltd [Member] | ' | ' |
Current Liabilities | ' | ' |
Due to related party | 1,107,678 | 1,107,678 |
Starlight Marketing Development, Ltd [Member] | Subordinated Debt [Member] | ' | ' |
Current Liabilities | ' | ' |
Due to related party | 816,753 | 0 |
Subordinated related party debt | 0 | 816,753 |
Starfair Electronics Company, Ltd [Member] | ' | ' |
Current Liabilities | ' | ' |
Due to related party | 17,738 | 0 |
Ram Light Management, Ltd [Member] | ' | ' |
Current Liabilities | ' | ' |
Due to related party | 1,683,247 | 1,683,247 |
Ram Light Management, Ltd [Member] | Subordinated Debt [Member] | ' | ' |
Current Liabilities | ' | ' |
Due to related party | 1,683,247 | 0 |
Subordinated related party debt | 0 | 1,683,247 |
Starlight R and D, Ltd [Member] | ' | ' |
Current Liabilities | ' | ' |
Due to related party | 194,678 | 419,600 |
Other Starlight Group Companies [Member] | ' | ' |
Current Assets | ' | ' |
Due from related party | 367,520 | 399,620 |
Current Liabilities | ' | ' |
Due to related party | 3,534 | 3,534 |
Starlight Consumer Electronics Co Ltd [Member] | ' | ' |
Current Liabilities | ' | ' |
Due to related party | 1,051,913 | 585,125 |
Common Class A [Member] | ' | ' |
Shareholders' Equity | ' | ' |
Common stock value | $0 | $0 |
CONSOLIDATED_BALANCE_SHEETS_Pa
CONSOLIDATED BALANCE SHEETS [Parenthetical] (USD $) | Mar. 31, 2014 | Mar. 31, 2013 |
Allowance for doubtful accounts (in dollars) | $172,465 | $180,306 |
Preferred stock, par value (in dollars per share) | $1 | $1 |
Preferred stock, shares authorized | 1,000,000 | 1,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value (in dollars per share) | $0.01 | $0.01 |
Common stock, shares authorized | 100,000,000 | 100,000,000 |
Common stock, shares issued | 38,070,642 | 38,028,975 |
Common stock, shares outstanding | 38,070,642 | 38,028,975 |
Common Class A [Member] | ' | ' |
Common stock, par value (in dollars per share) | $0.01 | $0.01 |
Common stock, shares authorized | 100,000 | 100,000 |
Common stock, shares issued | 0 | 0 |
Common stock, shares outstanding | 0 | 0 |
CONSOLIDATED_STATEMENTS_OF_INC
CONSOLIDATED STATEMENTS OF INCOME (USD $) | 12 Months Ended | ||
Mar. 31, 2014 | Mar. 31, 2013 | Mar. 31, 2012 | |
Net Sales | $31,379,629 | $34,437,774 | $25,943,832 |
Cost of Goods Sold | 24,273,038 | 26,368,945 | 20,292,738 |
Gross Profit | 7,106,591 | 8,068,829 | 5,651,094 |
Operating Expenses | ' | ' | ' |
Selling expenses | 2,402,153 | 3,078,340 | 2,470,985 |
General and administrative expenses | 4,257,335 | 3,310,325 | 2,537,379 |
Depreciation expense | 168,138 | 110,267 | 171,818 |
Total Operating Expenses | 6,827,626 | 6,498,932 | 5,180,182 |
Income from Operations | 278,965 | 1,569,897 | 470,912 |
Other Expenses | ' | ' | ' |
Interest expense | -53,446 | -48,421 | -7,796 |
Income before income tax benefit | 225,519 | 1,521,476 | 463,116 |
Income tax benefit | 778,797 | 1,619,459 | 0 |
Net Income | $1,004,316 | $3,140,935 | $463,116 |
Net Income per Common Share | ' | ' | ' |
Basic (in dollar per share) | $0.03 | $0.08 | $0.01 |
Diluted (in dollar per share) | $0.03 | $0.08 | $0.01 |
Weighted Average Common and Common Equivalent Shares: | ' | ' | ' |
Basic (in shares) | 38,057,628 | 37,973,309 | 37,877,460 |
Diluted (in shares) | 38,647,290 | 38,360,324 | 37,877,460 |
CONSOLIDATED_STATEMENTS_OF_CAS
CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) | 12 Months Ended | ||
Mar. 31, 2014 | Mar. 31, 2013 | Mar. 31, 2012 | |
Cash flows from operating activities | ' | ' | ' |
Net Income | $1,004,316 | $3,140,935 | $463,116 |
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | ' | ' | ' |
Depreciation | 168,138 | 110,267 | 171,818 |
Change in inventory reserve | 135,000 | -160,000 | 211,999 |
Change in allowance for bad debts | -7,841 | 11,752 | -7,250 |
Loss from disposal of property and equipment | 4,479 | 0 | 31,027 |
Stock based compensation | 107,351 | 14,777 | 26,030 |
Warranty provisions | 19,701 | -4,289 | 75,738 |
Change in net deferred tax assets | -778,797 | -1,619,459 | 0 |
Changes in operating assets and liabilities: | ' | ' | ' |
Accounts receivable | 152,765 | -326,737 | 426,969 |
Due from Crestmark Bank | -19,638 | 0 | 0 |
Inventories | -1,839,206 | 44,985 | -1,203,446 |
Prepaid expenses and other current assets | -6,647 | -31,208 | 6,077 |
Other non-current assets | 142,326 | -282 | 5,004 |
Increase (Decrease) in: | ' | ' | ' |
Accounts payable | 782,951 | -168,270 | 184,721 |
Net due to related parties | 345,679 | 18,116 | -347,946 |
Accrued expenses | -239,698 | 517,856 | -88,379 |
Obligations to clients for returns and allowances | 93,549 | 133,910 | -192,962 |
Net cash provided by (used in) operating activities | 64,428 | 1,682,353 | -237,484 |
Cash flows from investing activities | ' | ' | ' |
Purchase of property and equipment | -214,677 | -296,822 | -165,216 |
Deposit of restricted cash | -138,042 | 0 | 0 |
Net cash used in investing activities | -352,719 | -296,822 | -165,216 |
Cash flows from financing activities | ' | ' | ' |
Payments on long-term capital lease | -10,606 | 0 | -4,547 |
Net cash used in financing activities | -10,606 | 0 | -4,547 |
Change in cash | -298,897 | 1,385,531 | -407,247 |
Cash beginning of year | 1,652,996 | 267,465 | 674,712 |
Cash at end of year | 1,354,099 | 1,652,996 | 267,465 |
Supplemental Disclosures of Cash Flow Information: | ' | ' | ' |
Cash paid for Interest | 53,446 | 48,421 | 7,796 |
Cash paid for Income Taxes | 13,348 | 3,988 | 4,332 |
Supplemental Disclosures of Non-cash Investing Activities: | ' | ' | ' |
Property and equipment purchased under capital lease | $36,388 | $0 | $0 |
CONSOLIDATED_STATEMENTS_OF_SHA
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (DEFECIT) (USD $) | Total | Preferred Stock [Member] | Common Stock [Member] | Additional Paid-in Capital [Member] | Retained Earnings [Member] |
Balance at Mar. 31, 2011 | ($1,047,027) | $0 | $378,357 | $19,116,318 | ($20,541,702) |
Balance (in shares) at Mar. 31, 2011 | ' | 0 | 37,835,793 | ' | ' |
Net Income | 463,116 | 0 | 0 | 0 | 463,116 |
Employee compensation-stock option | 18,530 | 0 | 0 | 18,530 | 0 |
Director Fees | 7,500 | 0 | 1,250 | 6,250 | 0 |
Director Fees (in shares) | ' | 0 | 125,001 | ' | ' |
Balance at Mar. 31, 2012 | -557,881 | 0 | 379,607 | 19,141,098 | -20,078,586 |
Balance (in shares) at Mar. 31, 2012 | ' | 0 | 37,960,794 | ' | ' |
Net Income | 3,140,935 | 0 | 0 | 0 | 3,140,935 |
Employee compensation-stock option | 7,277 | 0 | 0 | 7,277 | 0 |
Director Fees | 7,500 | 0 | 682 | 6,818 | 0 |
Director Fees (in shares) | ' | 0 | 68,181 | ' | ' |
Balance at Mar. 31, 2013 | 2,597,831 | 0 | 380,289 | 19,155,193 | -16,937,651 |
Balance (in shares) at Mar. 31, 2013 | ' | 0 | 38,028,975 | ' | ' |
Net Income | 1,004,316 | 0 | 0 | 0 | 1,004,316 |
Employee compensation-stock option | 99,851 | 0 | 0 | 99,851 | 0 |
Director Fees | 7,500 | 0 | 417 | 7,083 | 0 |
Director Fees (in shares) | ' | 0 | 41,667 | ' | ' |
Balance at Mar. 31, 2014 | $3,709,498 | $0 | $380,706 | $19,262,127 | ($15,933,335) |
Balance (in shares) at Mar. 31, 2014 | ' | 0 | 38,070,642 | ' | ' |
BASIS_OF_PRESENTATION
BASIS OF PRESENTATION | 12 Months Ended |
Mar. 31, 2014 | |
Organization, Consolidation and Presentation Of Financial Statements [Abstract] | ' |
Basis of Accounting [Text Block] | ' |
NOTE 1 - BASIS OF PRESENTATION | |
OVERVIEW | |
The Singing Machine Company, Inc., a Delaware corporation (the "Company," “SMC”, "The Singing Machine"), and wholly-owned subsidiaries SMC (Comercial Offshore De Macau) Limitada (“Macau Subsidiary”), SMC Logistics, Inc. (“SMC-L”), SMC-Music, Inc. (“SMC-M”), and Singing Machine Holdings Ltd. (a B.V.I. company) are primarily engaged in the development, marketing, and sale of consumer karaoke audio equipment, accessories, musical instruments and musical recordings. The products are sold directly to distributors and retail customers. | |
The Company does business with a major supplier, koncepts International Limited (“koncepts”). koncepts is a major stockholder of the Company, owning approximately 52% of our shares of common stock outstanding. koncepts is an indirect wholly-owned subsidiary of Starlight International Holdings Limited (“Starlight International”), a company whose principal activities include designing, manufacturing and selling electronic products through its various subsidiaries. Starlight International’s products include television sets, consumer karaoke audio equipment and DVD products. We do business with a number of entities that are indirectly wholly-owned or majority owned subsidiaries of Starlight International, including Starlight Marketing Limited, Cosmo Communications Corporation (“Cosmo”) and Starlite Consumer Electronics (USA), Inc., among others (Starlight International and its subsidiaries collectively referred to herein as the “Starlight Group” or “Starlight”). | |
SUMMARY_OF_SIGNIFICANT_ACCOUNT
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended | ||
Mar. 31, 2014 | |||
Accounting Policies [Abstract] | ' | ||
Significant Accounting Policies [Text Block] | ' | ||
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |||
PRINCIPLES OF CONSOLIDATION | |||
The accompanying consolidated financial statements include the accounts of the Company, its Macau Subsidiary, SMC-L, SMC-M and The Singing Machine Holdings Ltd. All inter-company accounts and transactions have been eliminated in consolidation for all periods presented. | |||
USE OF ESTIMATES | |||
The Singing Machine makes estimates and assumptions in the ordinary course of business relating to sales returns and allowances, warranty reserves, inventory reserves and reserves for promotional incentives that affect the reported amounts of assets and liabilities and of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Future events and their effects cannot be determined with absolute certainty; therefore, the determination of estimates requires the exercise of judgment. Historically, past changes to these estimates have not had a material impact on the Company's financial condition. However, circumstances could change which may alter future expectations. | |||
COLLECTIBILITY OF ACCOUNTS RECEIVABLE | |||
The Singing Machine's allowance for doubtful accounts is based on management's estimates of the creditworthiness of its customers, current economic conditions and historical information, and, in the opinion of management, is believed to be in an amount sufficient to respond to normal business conditions. Management sets 100% reserves for customers in bankruptcy and other allowances based upon historical collection experience. Should business conditions deteriorate or any major customer default on its obligations to the Company, this allowance may need to be significantly increased, which would have a negative impact on operations. | |||
FOREIGN CURRENCY TRANSLATION | |||
The functional currency of the Macau Subsidiary is the Hong Kong dollar. The financial statements of the subsidiaries are translated to U.S. dollars using year-end rates of exchange for assets and liabilities, and average rates of exchange for the year for revenues, costs, and expenses. Net gains and losses resulting from foreign exchange transactions and translations were not material during the periods presented. | |||
Concentration of Credit Risk | |||
At times, the Company maintains cash in United States bank accounts that are in excess of the Federal Deposit Insurance Corporation (“FDIC”) insured amounts of up to $250,000. As of March 31, 2014 and March 31, 2013, the Company had cash deposits of $964,282 and $1,007,984 respectively that exceeded the FDIC insurance limit. The Company maintains cash balances in foreign financial institutions. The insured amounts at foreign financial institutions at March 31, 2014 and March 31, 2013 are $277,859 and $256,035, respectively. | |||
INVENTORY | |||
Inventories are comprised of electronic karaoke equipment, accessories, electronic musical instruments, electronic toys and compact discs and are stated at the lower of cost or market, as determined using the first in, first out method. The Singing Machine reduces inventory on hand to its net realizable value on an item-by-item basis when it is apparent that the expected realizable value of an inventory item falls below its original cost. A charge to cost of sales results when the estimated net realizable value of specific inventory items declines below cost. Management regularly reviews the Company's investment in inventories for such declines in value. | |||
REVENUE RECOGNITION | |||
Revenue from the sale of equipment, accessories, and musical recordings are recognized upon the later of: (a) the time of shipment or (b) when title passes to the customers and all significant contractual obligations have been satisfied and collection of the resulting receivable is reasonably assured. Net sales are comprised of gross sales net of actual and estimated future returns, discounts and volume rebates. The total returns represent 8.0%, 8.8%, and 7.7% of the gross sales for the twelve months ended March 31, 2014, 2013, and 2012, respectively. | |||
STOCK BASED COMPENSATION | |||
The Company follows the provisions of the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 718-20, “Compensation – Stock Compensation Awards Classified as Equity”. ASC 718-20 requires all share-based payments to employees including grants of employee stock options, be measured at fair value and expensed in the consolidated statement of income over the service period (generally the vesting period). The Company uses the Black-Scholes option valuation model to value stock options. Employee stock option compensation expense in fiscal years 2014, 2013 and 2012 includes the estimated fair value of options granted, amortized on a straight-line basis over the requisite service period for the entire portion of the award. For the years ended March 31, 2014, 2013 and 2012, the stock option expense was $99,851, $7,277 and $18,530, respectively. | |||
The fair value of each option grant was estimated on the date of the grant using the Black-Scholes option-pricing model with the assumptions outlined below. The expected volatility is based upon historical volatility of our stock and other contributing factors. The expected term is based upon observation of actual time elapsed between date of grant and exercise of options for all employees. Previously such assumptions were determined based on historical data. | |||
⋅ | For the year ended March 31, 2014: expected dividend yield 0%, risk-free interest rate of 0.13% to 0.15%, volatility 201.1% to 304.1% and expected term of three years. | ||
⋅ | For the year ended March 31, 2013: expected dividend yield 0%, risk-free interest rate of 0.14%, volatility 304.7% and expected term of one year. | ||
⋅ | For the year ended March 31, 2012: expected dividend yield 0%, risk-free interest rate of 0.19%, volatility 341.4% and expected term of one year. | ||
ADVERTISING | |||
Costs incurred for producing and publishing advertising of the Company are charged to operations the first time the advertising takes place. The Company has entered into cooperative advertising agreements with its major customers that specifically indicated that the customer has to spend the cooperative advertising fund upon the occurrence of mutually agreed events. The percentage of the cooperative advertising allowance ranges from 2% to 8% of the purchase. The customers have to advertise the Company's products in the customer's catalog, local newspaper and other advertising media. The customer must submit the proof of the performance (such as a copy of the advertising showing the Company’s products) to the Company to request for the allowance. The customer does not have the ability to spend the allowance at their discretion. The Company believes that the identifiable benefit from the cooperative advertising program and the fair value of the advertising benefit is equal or greater than the cooperative advertising expense. Advertising expense for the years ended March 31, 2014, 2013 and 2012 was $1,120,711, $1,688,692 and $1,089,512, respectively. | |||
RESEARCH AND DEVELOPMENT COSTS | |||
All research and development costs are charged to results of operations as incurred. These expenses are shown as a component of selling, general and administrative expenses in the consolidated statements of income. For the years ended March 31, 2014, 2013 and 2012, these amounts totaled $200,551, $70,870 and $37,852, respectively. | |||
FAIR VALUE OF FINANCIAL INSTRUMENTS | |||
We have adopted FASB ASC 825, Financial Instruments, which requires disclosures of information about the fair value of certain financial instruments for which it is practicable to estimate that value. For purposes of this disclosure, the fair value of a financial instrument is the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced sale or liquidation. | |||
The carrying amounts of the Company's short-term financial instruments, including accounts receivable, accounts payable, obligations to clients for returns and allowances, warranty provision, accrued expenses and net due to related parties approximates fair value due to the relatively short period to maturity for these instruments. | |||
INCOME TAXES | |||
The Company follows the provisions of FASB ASC 740 "Accounting for Income Taxes." Under the asset and liability method of ASC 740, deferred tax assets and liabilities are recognized for the future tax consequences attributed to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax base. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Under ASC 740, the effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. If it is more likely than not that some portion of a deferred tax asset will not be realized, a valuation allowance is recognized. Prior to the fiscal year ended March 31, 2013, the Company recognized a valuation allowance against the entire amount of the deferred tax asset. | |||
During the fiscal years ended March 31, 2014 and March 31, 2013, the Company reversed a portion of the valuation allowance as the Company determined that it is more likely than not that the deferred tax assets would be realized. As a result, approximately $0.8 million and $1.6 million of the valuation allowance were reversed during the fiscal years ended March 31, 2014 and March 31, 2013, respectively. The Company recognized an approximate tax benefit of $0.8 million and $1.6 million for the fiscal years ended March 31, 2014 and March 31, 2013, respectively. As of March 31, 2014 and March 31, 2013, The Singing Machine had net deferred tax assets and liabilities before valuation allowances of approximately $3.2 million and $3.2 million, respectively, against which the Company recorded valuation allowances totaling approximately $0.8 million and $1.6 million, respectively. | |||
The Company also follows the provisions in FASB ASC 740, Accounting for Uncertainty in Income Taxes. ASC 740 defines a recognition threshold and measurement attribute for financial statement recognition and measurements of tax positions taken or expected to be taken in a tax return. As of March 31, 2014 this position did not result in any adjustment to the Company’s provision for income taxes. Additionally, in accordance with FASB ASC 710, the Company’s policy is to recognize interest or penalties related to income tax matters in the provision for income taxes. The Company currently has no liabilities recorded for accrued interest or penalties related to uncertain tax positions. | |||
As of March 31, 2014, the Company is subject to U.S. Federal income tax examinations for the tax years ended March 31, 2011 through March 31, 2014. | |||
LONG-LIVED ASSETS | |||
The Company reviews long-lived assets for impairment whenever circumstances and situations change such that there is an indication that the carrying amounts may not be recoverable. If the undiscounted future cash flows attributable to the related assets are less than the carrying amount, the carrying amounts are reduced to fair value and an impairment loss is recognized in accordance with FASB ASC 360-10-05, "Accounting for the Impairment or Disposal of Long-Lived Assets." | |||
PROPERTY AND EQUIPMENT | |||
Property and equipment are stated at cost, less accumulated depreciation and amortization. Expenditures for repairs and maintenance are charged to expense as incurred. Depreciation is provided for in amounts sufficient to relate the cost of depreciable assets to their estimated useful lives using accelerated and straight-line methods. | |||
CASH | |||
The Company had cash balances at March 31, 2014 and March 31, 2013 of $1,492,141 and $1,652,996, respectively. On April 29, 2013 the Company issued a standby letter of credit in the amount of $131,068 to satisfy terms of a security deposit requirement of a new California warehouse lease agreement executed in March 2013. The Company was required to fund a restricted certificate of deposit in the amount of $138,042 as collateral for the standby letter of credit. | |||
SHIPPING AND HANDLING COSTS | |||
Shipping and handling costs are classified as a component of selling expenses and those billed to customers are recorded as a reduction of expense in the consolidated statements of income. | |||
RECENT ACCOUNTING PRONOUNCEMENTS | |||
In May 2014, the Financial Accounting Standards Board issued Accounting Standards Update (“ASU”) 2014-09 which outlines a single comprehensive model for companies to use when accounting for revenue arising from contracts with customers. The core principle of the revenue recognition model is that an entity recognizes revenue to depict the transfer of goods and services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In order to achieve this core principle a company must apply the following steps in determining revenue recognition: | |||
⋅ | Identify the contract(s) with a customer | ||
⋅ | Identify the performance obligations in the contract. | ||
⋅ | Determine the transaction price. | ||
⋅ | Allocate the transaction price to the performance obligations in the contract. | ||
⋅ | Recognize revenue when (or as) the entity satisfies a performance obligation. | ||
The amendments in this ASU are effective for annual reporting periods beginning after December 15, 2016 including interim periods within that reporting period with early application not allowed. Management is currently assessing whether the implementation of ASU 2014-09 will have any material effect on the company’s consolidated financial statements. | |||
INVENTORIES
INVENTORIES | 12 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
Inventory Disclosure [Abstract] | ' | |||||||
Inventory Disclosure [Text Block] | ' | |||||||
NOTE 3 - INVENTORIES | ||||||||
Inventories are comprised of the following components: | ||||||||
March 31, | March 31, | |||||||
2014 | 2013 | |||||||
Finished Goods | $ | 6,465,613 | $ | 4,626,407 | ||||
Less: Inventory Reserve | 638,000 | 503,000 | ||||||
Total Inventories | $ | 5,827,613 | $ | 4,123,407 | ||||
Inventory consigned to a distribution center at March 31, 2014 and March 31, 2013 was $353,201. | ||||||||
PROPERTY_AND_EQUIPMENT
PROPERTY AND EQUIPMENT | 12 Months Ended | |||||||||
Mar. 31, 2014 | ||||||||||
Property, Plant and Equipment [Abstract] | ' | |||||||||
Property, Plant and Equipment Disclosure [Text Block] | ' | |||||||||
NOTE 4 - PROPERTY AND EQUIPMENT | ||||||||||
A summary of property and equipment is as follows: | ||||||||||
USEFUL | MARCH 31, | MARCH 31, | ||||||||
LIFE | 2014 | 2013 | ||||||||
Computer and office equipment | 5 years | $ | 282,921 | $ | 279,742 | |||||
Furniture and fixtures | 7 years | 4,312 | 4,312 | |||||||
Leasehold improvement | * | - | 5,500 | |||||||
Warehouse equipment | 7 years | 224,106 | 136,521 | |||||||
Molds and tooling | 3-5 years | 2,324,120 | 1,849,245 | |||||||
Molds and tooling under development | ** | - | 329,500 | |||||||
2,835,459 | 2,604,820 | |||||||||
Less: Accumulated depreciation and amortization | 2,274,234 | 2,122,043 | ||||||||
$ | 561,225 | $ | 482,777 | |||||||
* Shorter of remaining term of lease or useful life | ||||||||||
** As of the fiscal years ended March 31, 2014, 2013 and 2012 the Company had outstanding commitments for molds and tooling in process in the amounts of approximately $0, $140,000 and $0, respectively. | ||||||||||
Depreciation expense for fiscal years ended 2014, 2013, and 2012 was $168,138, $110,267, and $171,818, respectively. | ||||||||||
DUE_TO_RELATED_PARTIES_NET
DUE TO RELATED PARTIES, NET | 12 Months Ended |
Mar. 31, 2014 | |
Related Party Transactions [Abstract] | ' |
Related Party Transactions Disclosure [Text Block] | ' |
NOTE 5 – DUE TO RELATED PARTIES, NET | |
As of March 31, 2014 the Company had $4,925,982 due to related parties consisting primarily of trade payables for karaoke hardware to Starlight Marketing Development Ltd in the amount of $1,924,431, Ram Light Management, Ltd in the amount of $1,683,247, Starlight Consumer Electronics Co., Ltd in the amount of $1,051,913, Starlight R&D in the amount of $194,678 for repair services and other Starlight Group Companies in the amount of $71,713. There were net additional amounts due from other Starlight Group companies totaling $367,520 related to other services and expenses provided by us for these companies. | |
As of March 31, 2013 the Company had $4,212,783 due to related parties consisting primarily of trade payables for karaoke hardware to Starlight Marketing Development Ltd in the amount of $1,924,431, Ram Light Management, Ltd in the amount of $1,683,247, Starlight Consumer Electronics Co., Ltd in the amount of $585,125 and $419,600 due to Starlight R&D for tooling and tooling modifications. There were net additional amounts due from other Starlight Group companies totaling $399,620 related to other expenses provided by us to these companies. | |
OBLIGATIONS_TO_CLIENTS_FOR_RET
OBLIGATIONS TO CLIENTS FOR RETURNS AND ALLOWANCES | 12 Months Ended |
Mar. 31, 2014 | |
Payables and Accruals [Abstract] | ' |
Accounts Payable, Accrued Liabilities, and Other Liabilities Disclosure, Current [Text Block] | ' |
NOTE 6 - OBLIGATIONS TO CLIENTS FOR RETURNS AND ALLOWANCES | |
Due to the seasonality of the business and length of time clients are given to return defective product, it is not uncommon for clients to accumulate credits from the Company’s sales and allowance programs that are in excess of unpaid invoices in accounts receivable. All credit balances in clients’ accounts receivable are reclassified to obligations to clients for returns and allowances in current liabilities on the Consolidated Balance Sheets. Client requests for payment of a credit balance are reclassified from obligations to clients for returns and allowances to accounts payable on the Consolidated Balance Sheets. When new invoices are processed prior to settlement of the credit balance and the client accepts settlement of open credits with new invoices, then the excess of new invoices over credits are netted in accounts receivable. As of the periods ended March 31, 2014 and March 31, 2013 obligations to clients for returns and allowances reclassified from accounts receivable were $469,838 and $376,289 respectively. There were credit amounts requested by clients to be paid for the periods ended March 31, 2014 and March 31, 2013 in the amounts of $0 and $636,474, respectively and accordingly these amounts were reclassified from obligations to clients for returns and allowances to accounts payable. | |
LINE_OF_CREDIT
LINE OF CREDIT | 12 Months Ended |
Mar. 31, 2014 | |
Line of Credit Facility [Abstract] | ' |
Debt Disclosure [Text Block] | ' |
NOTE 7 – LINE OF CREDIT | |
On October 19, 2012, the Company executed a two-year Accounts Receivable Ledgered Line of Credit Facility (“line of credit”) with Crestmark Bank (“Crestmark”) of Troy, Michigan which allows the Company to receive an advance of up to 70% of qualified accounts receivable. The outstanding loan balance on the line of credit cannot exceed $5,000,000 during our peak selling season between August 2 and February 14 and cannot exceed $500,000 between February 15 and August 1 of each year that the agreement is in effect. The Company has agreed to pledge all of its domestic accounts receivable shipped from North America (except drop shipment and related party invoices) to Crestmark and will assume all of the credit risk on accounts receivable pledged to Crestmark. | |
Interest on the line of credit and discounting charges on accounts receivable advances is accrued at a rate of 2% per annum over the prime rate as published by the Wall Street Journal and at no time shall the effective rate be less than 5.25% per annum. During the fiscal years ended March 31, 2014, 2013 and 2012 the Company incurred interest expense of $45,887, $28,714 and $0, respectively on amounts borrowed against the line of credit. The credit facility is secured with all assets of the Company as well as related-party debt subordination agreements totaling $2,500,000 from Ram Light Management, Ltd. in the amount of $1,683,247 and Starlight Marketing Development, Ltd. in the amount of $816,753. There is a 1% commission fee of the gross invoice amount on all domestic accounts receivable pledged. For the fiscal years ended March 31, 2014, 2013 and 2012 the Company incurred commission fees on pledged receivables in the amount of $239,829, $126,781 and $0, respectively. There were no amounts outstanding on the line of credit as of the years ended March 31, 2014 and 2013. | |
LONGTERM_CAPITAL_LEASE
LONG-TERM CAPITAL LEASE | 12 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
Debt Disclosure [Abstract] | ' | |||||||
Long-term Debt [Text Block] | ' | |||||||
NOTE 8 – LONG-TERM CAPITAL LEASE | ||||||||
On April 13, 2013, the company entered into a long-term capital leasing arrangement with Wells Fargo Equipment Finance (“Wells Fargo”) to finance the lease of two used forklift vehicles with a total purchase price of $38,952 of which $36,388 was financed under a capital lease. The lease requires monthly payments in the amount of $1,082 per month over a total lease term of 36 months which commenced on May 19, 2013. The agreement has an effective interest rate of 4.5% and the company has the option to purchase the equipment at the end of the lease term for one dollar. As of March 31, 2014 and March 31, 2013 the outstanding amount due to Wells Fargo was $25,782 and $0, respectively. | ||||||||
As of March 31, 2014 and March 31, 2013, the Company had obligations under the capital lease repayable as follows: | ||||||||
March 31, 2014 | March 31, 2013 | |||||||
Total minimum lease payments | ||||||||
Within one year | $ | 12,984 | $ | - | ||||
After one year but within 3 years | 14,066 | - | ||||||
27,050 | - | |||||||
Interest payments relating to future periods | -1,268 | - | ||||||
Present Value of minimum lease payments | $ | 25,782 | $ | - | ||||
For the fiscal years ended March 31, 2014 and March 31, 2013 the amount of interest related to the capital lease were $1,296 and $0, respectively. | ||||||||
COMMITMENTS_AND_CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended | ||||
Mar. 31, 2014 | |||||
Commitments and Contingencies Disclosure [Abstract] | ' | ||||
Commitments and Contingencies Disclosure [Text Block] | ' | ||||
NOTE 9 - COMMITMENTS AND CONTINGENCIES | |||||
LEGAL MATTERS | |||||
Management is currently not aware of any legal proceedings. | |||||
INCOME TAXES | |||||
In a letter dated July 21, 2008 the Internal Revenue Service (IRS) notified International SMC (HK) Limited “ISMC (HK)”, a former foreign subsidiary, of an unpaid tax balance on Income Tax Return of a Foreign Corporation (Form 1120-F) for the period ending March 31, 2003. According to the notice ISMC (HK) has an unpaid balance due in the amount of $241,639 that includes an interest assessment of $74,125. ISMC (HK) was sold in its entirety by the Company on September 25, 2006 to a British Virgin Islands company (“Purchaser”). The sale and purchase agreement with the Purchaser of ISMC (HK) specifies that the Purchaser would ultimately be responsible for any liabilities, including tax matters. On June 3, 2009 the IRS filed a federal tax lien in the amount of approximately $170,000 against ISMC (HK) under ISMC (HK)’s federal Tax ID. Management sought independent legal counsel to assess the potential liability, if any, on the Company. In a memorandum from independent counsel, the conclusion based on the facts presented was that the IRS would not prevail against the Company for collection of the ISMC (HK) income tax liability based on: | |||||
⋅ | The Internal Revenue Service’s asserted position that the Company is not the taxpayer. | ||||
⋅ | The 1120- F tax liability was recorded under the taxpayer identification number belonging to ISMC and not the Company’s taxpayer identification number | ||||
⋅ | The IRS would be barred from recovery since it failed to assess or issue a notice of levy within the three year statute of limitations | ||||
Based on the conclusion reached in the legal memorandum, management does not believe that the Company will have any further liability and has not accrued any liability in this matter. | |||||
OPERATING LEASES | |||||
The Company has entered into various operating lease agreements for office and warehouse facilities in Fort Lauderdale, Florida, Ontario, California and Macau expiring at varying dates. Rent expense for the years ended March 31, 2014, 2013 and 2012 was $611,977, $731,907 and $800,198, respectively. Included in rent expense is the cost for the warehouse facilities in City of Industry, California for which the operating lease expired on April 30, 2013 and was not renewed. On March 8, 2013 we executed a new lease for approximately 86,000 square feet of warehouse space in Ontario, California which commenced on June 1, 2013. The lease will expire on August 31, 2020 (term of 87 months) and includes a provision for the abatement of the first three months base rent in the amount of $113,412. | |||||
In addition, the Company maintains various warehouse equipment and office equipment operating leases. | |||||
Future minimum lease payments under property and equipment leases with terms exceeding one year as of March 31, 2014 are as follows: | |||||
Operating Leases | |||||
For fiscal year ending March 31, | |||||
2015 | $ | 514,616 | |||
2016 | 526,496 | ||||
2017 | 534,793 | ||||
2018 | 487,672 | ||||
2019 | 518,171 | ||||
2020 and beyond | 742,718 | ||||
$ | 3,324,466 | ||||
The above property lease payments are gross payments which are not net of supplemental sublease fees we receive. During fiscal years 2014, 2013 and 2012 the Company received fees of approximately $56,000, $56,000 and $0 respectively, for temporary sublease of warehouse space. | |||||
Such fees have been offset against rent expense in the consolidated statements of operations. | |||||
SHAREHOLDERS_EQUITY
SHAREHOLDERS' EQUITY | 12 Months Ended | |||||||||||||||||||
Mar. 31, 2014 | ||||||||||||||||||||
Stockholders' Equity Note [Abstract] | ' | |||||||||||||||||||
Stockholders Equity Note Disclosure [Text Block] | ' | |||||||||||||||||||
NOTE 10 - SHAREHOLDERS’ EQUITY | ||||||||||||||||||||
COMMON STOCK ISSUANCES | ||||||||||||||||||||
During the years ended March 31, 2014, 2013, and 2012, the Company issued the following common stock shares: | ||||||||||||||||||||
2014:00:00 | ||||||||||||||||||||
On July 23, 2013 the Company issued 41,667 shares of its common stock to our Board of Directors at $0.18 per share, pursuant to our annual director compensation plan. | ||||||||||||||||||||
2013:00:00 | ||||||||||||||||||||
On January 24, 2013 the Company issued 68,181 shares of its common stock to our Board of Directors at $0.11 per share, pursuant to our annual director compensation plan. | ||||||||||||||||||||
2012:00:00 | ||||||||||||||||||||
On December 2, 2011 the Company issued 125,001 shares of its common stock to our Board of Directors at $0.06 per share, pursuant to our annual director compensation plan. | ||||||||||||||||||||
EARNINGS PER SHARE | ||||||||||||||||||||
In accordance with FASB ASC 210, "Earnings per Share", basic net (loss) earnings per share are computed by dividing the net earnings (loss) for the year by the weighted average number of common shares outstanding. Diluted earnings per share is computed by dividing net earnings (loss) for the year by the weighted average number of common shares outstanding including the effect of common stock equivalents. | ||||||||||||||||||||
For the fiscal year ended March 31, 2014 there were common stock equivalents to purchase 1,256,000 shares of common stock of which 820,000 were included in the computation of diluted earnings per share. For the fiscal year ended March 31, 2013 there were common stock equivalents to purchase 1,251,380 shares of common stock of which 820,000 were included in the computation of diluted earnings per share. For the fiscal year ended March 31, 2012, common stock equivalents to purchase 700,000 shares of stock were not included in the computation of diluted earnings per share because the exercise prices were greater than the average market price of the Company’s common stock for the period. | ||||||||||||||||||||
STOCK OPTIONS | ||||||||||||||||||||
On June 1, 2001, the Board of Directors approved the 2001 Stock Option Plan (“Plan”), which replaced the 1994 Stock Option Plan, as amended. The Plan was developed to provide a means whereby directors and selected employees, officers, consultants, and advisors of the Company may be granted incentive or non-qualified stock options to purchase common stock of the Company. As of March 31, 2014, the Plan had expired and no shares were available to be issued nor were any additional shares issued from the plan in Fiscal 2014. | ||||||||||||||||||||
The Company adopted ASC 713-10 for the reporting periods ending after June 15, 2005 and thereafter has recognized the fair value of the stock option as part of the selling, general and administration expense. Accordingly, no compensation cost has been recognized for options issued under the Plan in periods prior to June 15, 2005. A summary of stock option activity for each of the years presented is summarized below. | ||||||||||||||||||||
Fiscal 2014 | Fiscal 2013 | Fiscal 2012 | ||||||||||||||||||
Number of Options | Weighted | Number of | Weighted | Number of | Weighted | |||||||||||||||
Average | Options | Average | Options | Average | ||||||||||||||||
Exercise Price | Exercise | Exercise Price | ||||||||||||||||||
Price | ||||||||||||||||||||
Stock Options: | ||||||||||||||||||||
Balance at beginning of period | 1,307,380 | $ | 0.3 | 1,251,380 | $ | 0.3 | 1,191,380 | $ | 0.56 | |||||||||||
Granted | 640,000 | 0.21 | 60,000 | $ | 0.18 | 60,000 | $ | 0.06 | ||||||||||||
Exercised | - | - | - | - | - | - | ||||||||||||||
Forfeited | -51,380 | - | -4,000 | 9 | - | - | ||||||||||||||
Balance at end of period | 1,896,000 | $ | 0.21 | 1,307,380 | $ | 0.26 | 1,251,380 | $ | 0.3 | |||||||||||
Options exercisable at end of period | 1,256,000 | $ | 0.22 | 1,247,380 | $ | 0.27 | 1,191,380 | $ | 0.31 | |||||||||||
The following table summarizes information about employee stock options outstanding at March 31, 2014: | ||||||||||||||||||||
Range of Exercise Price | Number Outstanding at March | Weighted Average Remaining | Weighted Average | Number Exercisable at March | Weighted Average | |||||||||||||||
31, 2014 | Contractural Life | Exercise Price | 31, 2014 | Exercise Price | ||||||||||||||||
$.03 - $.33 | 1,622,000 | 7.4 | 0.14 | 982,000 | 0.1 | |||||||||||||||
$.45 - $.93 | 274,000 | 2.7 | 0.64 | 274,000 | 0.64 | |||||||||||||||
* | 1,896,000 | 1,256,000 | ||||||||||||||||||
Prior to April 1, 2005, in accordance with ASC 713-10, for options issued to employees, the Company applied the intrinsic value method. | ||||||||||||||||||||
* Total number of options outstanding as of March 31, 2014 includes 120,000 options issued on March 31, 2014 and 2013 to three directors as compensation and 580,000 options issue to key employees on July 1, 2013 that were not issued from the Plan. | ||||||||||||||||||||
INCOME_TAXES
INCOME TAXES | 12 Months Ended | ||||||||||
Mar. 31, 2014 | |||||||||||
Income Tax Disclosure [Abstract] | ' | ||||||||||
Income Tax Disclosure [Text Block] | ' | ||||||||||
NOTE 11 - INCOME TAXES | |||||||||||
The Company files separate tax returns in the United States and in Macau. The Macau Subsidiary has received approval from the Macau government to operate its business as a Macau Offshore Company (MOC), and is exempt from the Macau income tax. For the fiscal years ended March 31, 2014, 2013 and 2012, the Macau Subsidiary recorded no tax provision. | |||||||||||
Due to the change of control of the Company, the net operating loss carry over is subject to the IRS Section 382 limitation. As of March 31, 2014, 2013 and 2012, The Singing Machine had net deferred tax assets before valuation allowances of approximately $3.2 million, $3.2 million, and $3.9 million, respectively, against which the Company recorded valuation allowances totaling approximately $0.8 million, $1.6 million, and $3.9 million, respectively. | |||||||||||
The income tax benefit for federal, foreign, and state income taxes in the consolidated statements of income consisted of the following components for 2014, 2013 and 2012: | |||||||||||
2014 | 2013 | 2012 | |||||||||
Income tax provision: | |||||||||||
Current: | |||||||||||
Federal | $ | - | $ | - | $ | - | |||||
State | - | - | - | ||||||||
Total current Federal and State | $ | - | $ | - | $ | - | |||||
Deferred: | |||||||||||
Federal | $ | -675,447 | $ | -1,412,535 | $ | - | |||||
State | -103,350 | -206,924 | - | ||||||||
Total income tax benefit | $ | -778,797 | $ | -1,619,459 | $ | - | |||||
The United States and foreign components of income (loss) before income taxes are as follows: | |||||||||||
2014 | 2013 | 2012 | |||||||||
United States | $ | -62,095 | $ | 92,122 | $ | -432,111 | |||||
Foreign | 287,614 | 1,429,354 | 895,227 | ||||||||
$ | 225,519 | $ | 1,521,476 | $ | 463,116 | ||||||
The actual tax expense differs from the "expected" tax expense for the years ended March 31, 2014, 2013 and 2012 (computed by applying the U.S. Federal Corporate tax rate of 34 percent to income before taxes) as follows: | |||||||||||
2014 | 2013 | 2012 | |||||||||
Expected tax expense | $ | 76,676 | $ | 517,302 | $ | 157,459 | |||||
State income taxes, net of Federal income tax benefit | 7,815 | 25,236 | 26,299 | ||||||||
Permanent differences | 8,374 | 5,421 | 5,247 | ||||||||
Deemed Dividend | 108,864 | 537,866 | 304,377 | ||||||||
Change in valuation allowance | -820,040 | -2,246,235 | 385,219 | ||||||||
Tax rate differential on foreign earnings | -111,164 | -537,866 | -304,377 | ||||||||
Prior year adjustments | -49,322 | 78,817 | -574,224 | ||||||||
Actual tax benefit | $ | -778,797 | $ | -1,619,459 | $ | - | |||||
The tax effects of temporary differences that give rise to significant portions of deferred tax assets and liabilities are as follows: | |||||||||||
2014 | 2013 | 2012 | |||||||||
Deferred tax assets: | |||||||||||
Federal net operating loss carryforward | $ | 2,076,141 | $ | 2,189,622 | $ | 2,579,924 | |||||
State net operating loss carryforward | 413,401 | 413,849 | 431,306 | ||||||||
AMT credit carryforward | 36,808 | 36,808 | 70,090 | ||||||||
Inventory differences | 490,716 | 358,130 | 438,773 | ||||||||
Allowance for doubtful accounts | 66,658 | 67,849 | 57,308 | ||||||||
Reserve for sales returns | 90,895 | 81,082 | 74,718 | ||||||||
Stock option compensation expense | 59,713 | - | - | ||||||||
Stock warrants | 39,193 | - | - | ||||||||
Charitable contributions | - | - | 60,700 | ||||||||
Accrued Vacation | 10,241 | 9,839 | 9,551 | ||||||||
Depreciation and amortization | - | 81,739 | 135,660 | ||||||||
Amortization of reorganization intangible | - | - | 7,664 | ||||||||
Total deferred tax assets | 3,283,766 | 3,238,918 | 3,865,694 | ||||||||
Deferred tax liability: | |||||||||||
Depreciation | -86,091 | - | - | ||||||||
Net deferred tax asset before valuation allowance | 3,197,675 | 3,238,918 | 3,865,694 | ||||||||
Valuation allowance | -799,419 | -1,619,459 | -3,865,694 | ||||||||
Net deferred tax assets | $ | 2,398,256 | $ | 1,619,459 | $ | - | |||||
Due to economic conditions prior to the fiscal year ended March 31, 2013, the Company believed that it was more likely than not that the benefit from the net deferred tax assets would not be realized, and established a valuation allowance on the deferred tax assets for the entire balance. | |||||||||||
During the fiscal year ended March 31, 2014 and March 31, 2013, the Company released a portion of the valuation allowance. The release of the valuation allowance was determined in accordance with the provisions of ASC 740, which require an assessment of both positive and negative evidence when determining whether it is more likely than not that deferred tax assets are recoverable. The analysis performed to assess the realizability of the deferred tax assets included an evaluation of the pattern and timing of the reversals of temporary differences and the length of carryback and carry forward periods available under the applicable federal and state laws; and the amount and timing of future taxable income. The analysis indicated that it is more likely than not that at least 75% of the deferred tax asset recorded will be realized. As a result, approximately $0.8 million and $1.6 million of the valuation allowance were released during the fiscal years ended March 31, 2014 and March 31, 2013, respectively. The Company recognized an approximate tax benefit of $0.8 million and $1.6 million for the fiscal years ended March 31, 2014 and March 31, 2013, respectively. | |||||||||||
At March 31, 2014, the Company has federal tax net operating loss carry forwards in the amount of approximately $6.1 million that will expire beginning in the year 2027. In addition, the Company has state tax net operating loss carry forwards in the amount of approximately $8.9 million that will expire beginning in 2015. The Company has now exhausted its ability to carry back any further losses and therefore will only be able to recognize tax benefits to the extent that it has future taxable income. Net operating loss carry forward amounts and their year of expiration are as follows: | |||||||||||
Year of | NOL | NOL | |||||||||
Expiration | Federal | State | |||||||||
2014 | $ | - | $ | - | |||||||
2015 | - | 1,984,929 | |||||||||
2016 | - | - | |||||||||
2017 | - | - | |||||||||
2018 | - | - | |||||||||
2019 and beyond | 6,106,299 | 6,884,857 | |||||||||
$ | 6,106,299 | $ | 8,869,786 | ||||||||
The Company is no longer subject to income tax examinations for fiscal years before 2011. | |||||||||||
SEGMENT_INFORMATION
SEGMENT INFORMATION | 12 Months Ended | ||||||||||
Mar. 31, 2014 | |||||||||||
Segment Reporting [Abstract] | ' | ||||||||||
Segment Reporting Disclosure [Text Block] | ' | ||||||||||
NOTE 12 - SEGMENT INFORMATION | |||||||||||
The Company operates in one segment and maintains its records accordingly. The majority of sales to customers outside of the United States are made by the Macau Subsidiary until its date of sale. Sales by geographic region for the period presented are as follows: | |||||||||||
2014 | 2013 | 2012 | |||||||||
North America | $ | 31,379,629 | $ | 34,068,559 | $ | 25,313,446 | |||||
Europe | - | 369,215 | 630,386 | ||||||||
$ | 31,379,629 | $ | 34,437,774 | $ | 25,943,832 | ||||||
The geographic area of sales is based primarily on the location where the product is delivered. | |||||||||||
SEPARATION_AGREEMENTS_DUE_TO_C
SEPARATION AGREEMENTS DUE TO CHANGE IN OWNERSHIP | 12 Months Ended | ||
Mar. 31, 2014 | |||
Agreements Due To Change In Ownership [Abstract] | ' | ||
Agreements Due To Change In Ownership Disclosure [Text Block] | ' | ||
NOTE 13 – SEPARATION AGREEMENTS DUE TO CHANGE IN OWNERSHIP | |||
On January 3, 2014, the Company entered into agreements with its executive officers that if an executive’s employment is terminated by the executive or the Company following a change in control, the executive will be entitled to the following within 10 days of termination: | |||
⋅ | All accrued and unpaid compensation due to the executive as of the date of termination. | ||
⋅ | A lump sum payment equal to one year’s executive base salary if the executive terminates employment. | ||
⋅ | A lump sum of one and a half year’s executive base salary and targeted annual bonus if the Company terminates employment. | ||
⋅ | All outstanding stock options shall be fully vested and exercisable for the remainder of their full term. | ||
⋅ | All outstanding equity-based compensation awards (other than stock options) shall become fully vested with any restrictions removed. | ||
EMPLOYEE_BENEFIT_PLANS
EMPLOYEE BENEFIT PLANS | 12 Months Ended |
Mar. 31, 2014 | |
Compensation and Retirement Disclosure [Abstract] | ' |
Compensation and Employee Benefit Plans [Text Block] | ' |
NOTE 14 - EMPLOYEE BENEFIT PLANS | |
The Company has a 401(k) plan for its employees to which the Company makes contributions at rates dependent on the level of each employee's contributions. Contributions made by the Company are limited to the maximum allowable for federal income tax purposes. The amounts charged to operations for contributions to this plan and administrative costs during the years ended March 31, 2014, 2013, and 2012 totaled $27,869, $30,589 and $24,933, respectively. The amounts are included as a component of general and administrative expense in the accompanying Consolidated Statements of Income. The Company does not provide any post employment benefits to retirees. | |
CONCENTRATIONS_OF_CREDIT_RISK_
CONCENTRATIONS OF CREDIT RISK, CUSTOMERS, AND SUPPLIERS | 12 Months Ended |
Mar. 31, 2014 | |
Risks and Uncertainties [Abstract] | ' |
Concentration Risk Disclosure [Text Block] | ' |
NOTE 15 - CONCENTRATIONS OF CREDIT RISK, CUSTOMERS, AND SUPPLIERS | |
The Company derives a majority of its revenues from retailers of products in the United States. Financial instruments, which potentially subject the Company to concentrations of credit risk, consist of accounts receivable. The Company's allowance for doubtful accounts is based upon management's estimates and historical experience and reflects the fact that accounts receivable are concentrated with several large customers whose credit worthiness have been evaluated by management. At March 31, 2014, 80% of accounts receivable were due from three customers in North America. Accounts receivable from customers that individually owed over 10% of total accounts receivable was 40%, 29% and 11% at March 31, 2014. Accounts receivable from customers that individually owed over 10% of total accounts receivable was 53%, 18% and 11% at March 31, 2013. The Company performs ongoing credit evaluations of its customers. | |
Revenues derived from five customers in 2014, 2013, and 2012 were 74%, 66% and 70% of total revenues, respectively. Revenues derived from top three customers in 2014, 2013 and 2012 as percentage of the total revenue were 26%, 17% and 11%; 23%, 21% and 13%; and 29%, 17% and 15%, respectively. The loss of any of these customers can have an adverse impact on the financial position of the Company. | |
Net sales derived from the Macau Subsidiary aggregated $9.3 million in 2014, $12.5 million in 2013 and $11.8 million in 2012. | |
The Company is dependent upon foreign companies for the manufacture of all of its electronic products. The Company's arrangements with manufacturers are subject to the risk of doing business abroad, such as import duties, trade restrictions, work stoppages, foreign currency fluctuations, political instability, and other factors, which could have an adverse impact on its business. The Company believes that the loss of any one or more of their suppliers would not have a long-term material adverse effect because other manufacturers with whom the Company does business would be able to increase production to fulfill their requirements. However, the loss of certain suppliers in the short-term could adversely affect business until alternative supply arrangements are secured. | |
During fiscal years 2014, 2013, and 2012, manufacturers in the People's Republic of China ("China") accounted for approximately 99% of the Company's total product purchases, including all of the Company's hardware purchases. | |
QUARTERLY_FINANCIAL_DATA_UNAUD
QUARTERLY FINANCIAL DATA - UNAUDITED | 12 Months Ended | ||||||||||||||||
Mar. 31, 2014 | |||||||||||||||||
Quarterly Financial Data [Abstract] | ' | ||||||||||||||||
Quarterly Financial Information [Text Block] | ' | ||||||||||||||||
NOTE 16 - QUARTERLY FINANCIAL DATA - UNAUDITED | |||||||||||||||||
The following financial information reflects all normal recurring adjustments that are, in the opinion of management, necessary for a fair statement of the results of the interim periods. The quarterly unaudited results for the years 2014, 2013, and 2012 are set forth in the following table: | |||||||||||||||||
Sales | Gross Profit | Net Earnings | Basic | Diluted | |||||||||||||
(Loss) | Earnings | Earnings | |||||||||||||||
(Loss) | (Loss) | ||||||||||||||||
Per Share | Per Share | ||||||||||||||||
(In thousands) | (In thousands) | (In thousands) | |||||||||||||||
2014 | |||||||||||||||||
First quarter | $ | 1,414 | $ | 301 | $ | -541 | $ | -0.01 | $ | -0.01 | |||||||
Second quarter | 10,835 | 2,403 | 324 | 0.01 | 0.01 | ||||||||||||
Third quarter | 16,815 | 4,107 | 821 | 0.02 | 0.02 | ||||||||||||
Fourth quarter | 2,316 | 296 | 400 | 0 | 0 | ||||||||||||
Fiscal Year 2014 | $ | 31,380 | $ | 7,107 | $ | 1,004 | $ | 0.02 | $ | 0.02 | |||||||
2013 | |||||||||||||||||
First quarter | $ | 1,763 | $ | 444 | $ | -480 | $ | -0.01 | $ | -0.01 | |||||||
Second quarter | 14,376 | 3,471 | 1,435 | 0.04 | 0.04 | ||||||||||||
Third quarter | 16,617 | 4,022 | 1,397 | 0.04 | 0.04 | ||||||||||||
Fourth quarter | 1,682 | 132 | 789 | 0.01 | 0.01 | ||||||||||||
Fiscal Year 2013 | $ | 34,438 | $ | 8,069 | $ | 3,141 | $ | 0.08 | $ | 0.08 | |||||||
2012 | |||||||||||||||||
First quarter | $ | 1,788 | $ | 429 | $ | -507 | $ | -0.01 | $ | -0.01 | |||||||
Second quarter | 14,150 | 3,193 | 1,466 | 0.04 | 0.04 | ||||||||||||
Third quarter | 8,651 | 1,796 | 134 | 0 | 0 | ||||||||||||
Fourth quarter | 1,355 | 233 | -630 | -0.02 | -0.02 | ||||||||||||
Fiscal Year 2012 | $ | 25,944 | $ | 5,651 | $ | 463 | $ | 0.01 | $ | 0.01 | |||||||
RELATED_PARTY_TRANSACTIONS
RELATED PARTY TRANSACTIONS | 12 Months Ended |
Mar. 31, 2014 | |
Related Party Transactions [Abstract] | ' |
Related Party Transactions Disclosure Excluding Due To Or From [Text Block] | ' |
NOTE 17 – RELATED PARTY TRANSACTIONS | |
TRADE | |
Approximately 35% of our karaoke products in Fiscal 2014 were produced by factories owned by the Starlight Group and we anticipate that approximately 30% of our karaoke products will be manufactured by the Starlight Group in Fiscal 2015. Starlight International has verbally agreed to manufacture our karaoke products without requiring prepayment from us and will instead assume the cost of manufacturing the products until such time as we are paid by the customers who are purchasing those products from us. | |
During Fiscal 2014 and 2013 we sold approximately $1,861,000 and $1,813,000, respectively of product to Star Light Electronics Company, Ltd. (“Star Light”) a related company, for direct shipment to Cosmo Communications of Canada, Ltd (“Cosmo”), another related company, at discounted pricing granted to major distributors. In addition, we sold an additional $1,318,000 in Fiscal 2014 and $410,000 in Fiscal 2013 of product to Cosmo from our California warehouse facility. The average gross profit margin on sales to Cosmo yielded 16.2% and 14.4%, respectively. | |
During Fiscal 2014 and 2013 we purchased products from Starlight Consumer Electronics USA, Inc, (“Starlight USA) an indirect wholly-owned subsidiary of Starlight International of approximately $8,012,000 and $4,932,000, respectively. In Fiscal 2014 and Fiscal 2013, we also purchased products from Star Fair Electronics Co., Ltd. (“Star Fair”) of approximately $873,000 and $3,061,000, respectively, Starlight R&D, Ltd (“Starlight R&D”) of approximately $2,000 and $21,000, respectively, Cosmo USA of approximately of $41,000 and $286,000, respectively and Cosmo Canada of approximately $114,000 and $0, respectively. All of these companies were indirectly wholly-owned subsidiaries of Starlight International. During the fiscal years ended March 31, 2014 and 2013 we received charges for repair defective products from Star Fair in the amount of approximately $52,000 and $39,000 respectively. In connection with the import of these products to our California warehouse we paid inbound freight and duty charges during the fiscal years ended March 31, 2014 and 2013 to Starlight Consumer Electronics USA, Inc. of approximately $109,000 and $54,000, respectively and to Starlight R&D, Ltd of approximately $263,000 and $229,000, respectively. | |
During the fiscal years ended March 31, 2014 and 2013, we paid $145,000 and $96,000, respectively to Star Light as reimbursement for engineering and quality control services performed on our behalf in China. During the fiscal years ended March 31, 2014 and 2013, we received $60,000 from Starlight USA as reimbursement for customer support services performed by us on behalf of Starlight USA. These expense reimbursements were included in general and administrative expense on our consolidated statements of operations. | |
Effective April 1, 2014, SMC-L entered into a service and logistics agreement with Starlight Consumer Electronics (USA), Inc. (“Starlight USA”), an indirect wholly-owned subsidiary of Starlight International, Cosmo USA, Inc. (“Cosmo USA”) and Starlight Electronics USA, Inc. (“Starlight Electronics USA”) to provide logistics, fulfillment, and warehousing services for Starlight USA, Cosmo USA and Starlight Electronic USA’s domestic sales. For these services, Starlight USA, Cosmo USA and Starlight Electronics USA have agreed to reimburse the Company for actual warehouse space occupied by these companies at $8 per pallet and for logistics services performed based on an agreed to fee schedule specified in the agreement. This agreement is estimated to yield approximately $180,000 in reimbursements for the fiscal year ending March 31, 2015. | |
Effective April 1, 2013, SMC-L entered into a service and logistics agreement with Starlight USA, Cosmo USA and Starlight Electronics USA, to provide logistics, fulfillment, and warehousing services for Starlight USA, Cosmo USA and Starlight Electronic USA’s domestic sales. For these services, Starlight USA, Cosmo USA and Starlight Electronics USA have agreed to reimburse the Company for actual warehouse space occupied by these companies at $0.50 per square foot and for logistics services performed based on an agreed to fee schedule specified in the agreement. The Company received $330,000 and $0 in service fees from these affiliates during the twelve months ended March 31, 2014 and March 31, 2013, respectively. | |
On July 1, 2012, SMC-L entered into a service and logistics agreement with Starlight USA, Cosmo USA and Starlight Electronics USA to provide logistics, fulfillment, and warehousing services for Starlight USA, Cosmo USA and Starlight Electronic USA’s domestic sales. For these services, Starlight USA, Cosmo USA and Starlight Electronics USA have agreed to pay the Company annual service fees totaling approximately $435,000 payable monthly beginning July 1, 2012. The Company received approximately $0 and $399,000 in service fees from these affiliates during Fiscal 2014 and Fiscal 2013, respectively. This agreement terminated on March 31, 2013. | |
On August 1, 2011, SMC-L entered into a service and logistics agreement with affiliates Starlight USA, Starlight Electronics USA and Cosmo USA to provide logistics, fulfillment, and warehousing services for the affiliates’ domestic sales. The Company received approximately $0 and $250,000 in service fees from these affiliates during Fiscal 2014 and 2013, respectively. This agreement terminated on June 30, 2012. | |
WARRANTY_PROVISIONS
WARRANTY PROVISIONS | 12 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
Product Warranties Disclosures [Abstract] | ' | |||||||
Product Warranty Disclosure [Text Block] | ' | |||||||
NOTE 18 – WARRANTY PROVISIONS | ||||||||
A return program for defective goods is negotiated with each of our wholesale customers on a year-to-year basis. Customers are either allowed to return defective goods within a specified period of time after shipment (between 6 and 9 months) or granted a “defective allowance” consisting of a fixed percentage (between 1% and 5%) off of invoice price in lieu of returning defective products. The Company records liabilities for its return goods programs and defective goods allowance program at the time of sale for the estimated costs that may be incurred. The liability for defective goods is included in warranty provisions on the Consolidated Balance Sheets. | ||||||||
Changes in the Company’s obligations for return and allowance programs are presented in the following table: | ||||||||
Fiscal Year Ended | ||||||||
March 31, | March 31, | |||||||
2014 | 2013 | |||||||
Estimated return and allowance liabilities at beginning of period | $ | 215,471 | $ | 219,760 | ||||
Costs accrued for new estimated returns and allowances | 826,577 | 1,183,134 | ||||||
Return and allowance obligations honored | -806,876 | -1,187,423 | ||||||
Estimated return and allowance liabilities at end of period | $ | 235,172 | $ | 215,471 | ||||
SUBORDINATED_RELATED_PARTY_DEB
SUBORDINATED RELATED PARTY DEBT | 12 Months Ended |
Mar. 31, 2014 | |
Subordinated Related Party Debt [Abstract] | ' |
Subordinated Related Party Debt [Text Block] | ' |
NOTE 19 – SUBORDINATED RELATED PARTY DEBT | |
In connection with the line of credit with Crestmark Bank the Company was required to subordinate related party debt from Ram Light Management, Ltd. in the amount of $1,683,247 and Starlight Marketing Development, Ltd. in the amount of $816,753. Since the subordination agreements are in effect throughout the term of the agreement, the amounts due are not payable until the agreement has been terminated on October 12, 2014. Since the agreement expires within one year the subordinated related party debt has been classified as a current liability on the accompanying balance sheet as of March 31, 2014. | |
SUBSEQUENT_EVENTS
SUBSEQUENT EVENTS | 12 Months Ended |
Mar. 31, 2014 | |
Subsequent Events [Abstract] | ' |
Subsequent Events [Text Block] | ' |
NOTE 20 – SUBSEQUENT EVENTS | |
On June 11, 2014 SMC Logistics entered into a two year logistics service agreement with Telasia, Inc. The agreement provides logistics, fulfillment, and warehousing services for Telasia’s domestic sales. The Company anticipates the revenue from the service agreement to be approximately $360,000 over the life of the agreement. | |
SUPPLEMENTAL_DATA_SCHEDULE_II
SUPPLEMENTAL DATA SCHEDULE II | 12 Months Ended | ||||||||||||||||
Mar. 31, 2014 | |||||||||||||||||
Valuation and Qualifying Accounts [Abstract] | ' | ||||||||||||||||
Schedule of Valuation and Qualifying Accounts Disclosure [Text Block] | ' | ||||||||||||||||
SUPPLEMENTAL DATA | |||||||||||||||||
SCHEDULE II – Valuation and Qualifying Accounts | |||||||||||||||||
Balance at | Charged to | Reduction to | Credited to | Balance at | |||||||||||||
Beginning of | Costs and | Allowance for | Costs and | End of | |||||||||||||
Description | Period | Expenses | Write off | Expenses | Period | ||||||||||||
Year ended March 31, 2014 | |||||||||||||||||
Reserves deducted from assets to which they apply: | |||||||||||||||||
Allowance for doubtful accounts | $ | 180,306 | $ | - | $ | -15,807 | $ | 7,966 | $ | 172,465 | |||||||
Deferred tax valuation allowance | $ | 1,619,459 | $ | - | $ | -820,040 | $ | - | $ | 799,419 | |||||||
Inventory reserve | $ | 503,000 | $ | 160,000 | $ | -25,000 | $ | - | $ | 638,000 | |||||||
Year ended March 31, 2013 | |||||||||||||||||
Reserves deducted from assets to which they apply: | |||||||||||||||||
Allowance for doubtful accounts | $ | 168,554 | $ | - | $ | -8,248 | $ | 20,000 | $ | 180,306 | |||||||
Deferred tax valuation allowance | $ | 3,865,695 | $ | -626,777 | $ | -1,619,459 | $ | - | $ | 1,619,459 | |||||||
Inventory reserve | $ | 663,000 | $ | 104,175 | $ | -264,175 | $ | - | $ | 503,000 | |||||||
Year ended March 31, 2012 | |||||||||||||||||
Reserves deducted from assets to which they apply: | |||||||||||||||||
Allowance for doubtful accounts | $ | 175,804 | $ | - | $ | -8,323 | $ | 1,073 | $ | 168,554 | |||||||
Deferred tax valuation allowance | $ | 3,480,475 | $ | - | $ | - | $ | 385,220 | $ | 3,865,695 | |||||||
Inventory reserve | $ | 451,001 | $ | 398,000 | $ | -186,001 | $ | - | $ | 663,000 | |||||||
SUMMARY_OF_SIGNIFICANT_ACCOUNT1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended | ||
Mar. 31, 2014 | |||
Accounting Policies [Abstract] | ' | ||
Consolidation, Policy [Policy Text Block] | ' | ||
PRINCIPLES OF CONSOLIDATION | |||
The accompanying consolidated financial statements include the accounts of the Company, its Macau Subsidiary, SMC-L, SMC-M and The Singing Machine Holdings Ltd. All inter-company accounts and transactions have been eliminated in consolidation for all periods presented. | |||
Use of Estimates, Policy [Policy Text Block] | ' | ||
USE OF ESTIMATES | |||
The Singing Machine makes estimates and assumptions in the ordinary course of business relating to sales returns and allowances, warranty reserves, inventory reserves and reserves for promotional incentives that affect the reported amounts of assets and liabilities and of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Future events and their effects cannot be determined with absolute certainty; therefore, the determination of estimates requires the exercise of judgment. Historically, past changes to these estimates have not had a material impact on the Company's financial condition. However, circumstances could change which may alter future expectations. | |||
Receivables, Trade and Other Accounts Receivable, Allowance for Doubtful Accounts, Policy [Policy Text Block] | ' | ||
COLLECTIBILITY OF ACCOUNTS RECEIVABLE | |||
The Singing Machine's allowance for doubtful accounts is based on management's estimates of the creditworthiness of its customers, current economic conditions and historical information, and, in the opinion of management, is believed to be in an amount sufficient to respond to normal business conditions. Management sets 100% reserves for customers in bankruptcy and other allowances based upon historical collection experience. Should business conditions deteriorate or any major customer default on its obligations to the Company, this allowance may need to be significantly increased, which would have a negative impact on operations. | |||
Foreign Currency Transactions and Translations Policy [Policy Text Block] | ' | ||
FOREIGN CURRENCY TRANSLATION | |||
The functional currency of the Macau Subsidiary is the Hong Kong dollar. The financial statements of the subsidiaries are translated to U.S. dollars using year-end rates of exchange for assets and liabilities, and average rates of exchange for the year for revenues, costs, and expenses. Net gains and losses resulting from foreign exchange transactions and translations were not material during the periods presented. | |||
Concentration of Credit Risk [Policy Text Block] | ' | ||
Concentration of Credit Risk | |||
At times, the Company maintains cash in United States bank accounts that are in excess of the Federal Deposit Insurance Corporation (“FDIC”) insured amounts of up to $250,000. As of March 31, 2014 and March 31, 2013, the Company had cash deposits of $964,282 and $1,007,984 respectively that exceeded the FDIC insurance limit. The Company maintains cash balances in foreign financial institutions. The insured amounts at foreign financial institutions at March 31, 2014 and March 31, 2013 are $277,859 and $256,035, respectively. | |||
Inventory, Policy [Policy Text Block] | ' | ||
INVENTORY | |||
Inventories are comprised of electronic karaoke equipment, accessories, electronic musical instruments, electronic toys and compact discs and are stated at the lower of cost or market, as determined using the first in, first out method. The Singing Machine reduces inventory on hand to its net realizable value on an item-by-item basis when it is apparent that the expected realizable value of an inventory item falls below its original cost. A charge to cost of sales results when the estimated net realizable value of specific inventory items declines below cost. Management regularly reviews the Company's investment in inventories for such declines in value. | |||
Revenue Recognition, Policy [Policy Text Block] | ' | ||
REVENUE RECOGNITION | |||
Revenue from the sale of equipment, accessories, and musical recordings are recognized upon the later of: (a) the time of shipment or (b) when title passes to the customers and all significant contractual obligations have been satisfied and collection of the resulting receivable is reasonably assured. Net sales are comprised of gross sales net of actual and estimated future returns, discounts and volume rebates. The total returns represent 8.0%, 8.8%, and 7.7% of the gross sales for the twelve months ended March 31, 2014, 2013, and 2012, respectively. | |||
Share-based Compensation, Option and Incentive Plans Policy [Policy Text Block] | ' | ||
STOCK BASED COMPENSATION | |||
The Company follows the provisions of the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 718-20, “Compensation – Stock Compensation Awards Classified as Equity”. ASC 718-20 requires all share-based payments to employees including grants of employee stock options, be measured at fair value and expensed in the consolidated statement of income over the service period (generally the vesting period). The Company uses the Black-Scholes option valuation model to value stock options. Employee stock option compensation expense in fiscal years 2014, 2013 and 2012 includes the estimated fair value of options granted, amortized on a straight-line basis over the requisite service period for the entire portion of the award. For the years ended March 31, 2014, 2013 and 2012, the stock option expense was $99,851, $7,277 and $18,530, respectively. | |||
The fair value of each option grant was estimated on the date of the grant using the Black-Scholes option-pricing model with the assumptions outlined below. The expected volatility is based upon historical volatility of our stock and other contributing factors. The expected term is based upon observation of actual time elapsed between date of grant and exercise of options for all employees. Previously such assumptions were determined based on historical data. | |||
⋅ | For the year ended March 31, 2014: expected dividend yield 0%, risk-free interest rate of 0.13% to 0.15%, volatility 201.1% to 304.1% and expected term of three years. | ||
⋅ | For the year ended March 31, 2013: expected dividend yield 0%, risk-free interest rate of 0.14%, volatility 304.7% and expected term of one year. | ||
⋅ | For the year ended March 31, 2012: expected dividend yield 0%, risk-free interest rate of 0.19%, volatility 341.4% and expected term of one year. | ||
Advertising Costs, Policy [Policy Text Block] | ' | ||
ADVERTISING | |||
Costs incurred for producing and publishing advertising of the Company are charged to operations the first time the advertising takes place. The Company has entered into cooperative advertising agreements with its major customers that specifically indicated that the customer has to spend the cooperative advertising fund upon the occurrence of mutually agreed events. The percentage of the cooperative advertising allowance ranges from 2% to 8% of the purchase. The customers have to advertise the Company's products in the customer's catalog, local newspaper and other advertising media. The customer must submit the proof of the performance (such as a copy of the advertising showing the Company’s products) to the Company to request for the allowance. The customer does not have the ability to spend the allowance at their discretion. The Company believes that the identifiable benefit from the cooperative advertising program and the fair value of the advertising benefit is equal or greater than the cooperative advertising expense. Advertising expense for the years ended March 31, 2014, 2013 and 2012 was $1,120,711, $1,688,692 and $1,089,512, respectively. | |||
Research and Development Expense, Policy [Policy Text Block] | ' | ||
RESEARCH AND DEVELOPMENT COSTS | |||
All research and development costs are charged to results of operations as incurred. These expenses are shown as a component of selling, general and administrative expenses in the consolidated statements of income. For the years ended March 31, 2014, 2013 and 2012, these amounts totaled $200,551, $70,870 and $37,852, respectively. | |||
Fair Value of Financial Instruments, Policy [Policy Text Block] | ' | ||
FAIR VALUE OF FINANCIAL INSTRUMENTS | |||
We have adopted FASB ASC 825, Financial Instruments, which requires disclosures of information about the fair value of certain financial instruments for which it is practicable to estimate that value. For purposes of this disclosure, the fair value of a financial instrument is the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced sale or liquidation. | |||
The carrying amounts of the Company's short-term financial instruments, including accounts receivable, accounts payable, obligations to clients for returns and allowances, warranty provision, accrued expenses and net due to related parties approximates fair value due to the relatively short period to maturity for these instruments. | |||
Income Tax, Policy [Policy Text Block] | ' | ||
INCOME TAXES | |||
The Company follows the provisions of FASB ASC 740 "Accounting for Income Taxes." Under the asset and liability method of ASC 740, deferred tax assets and liabilities are recognized for the future tax consequences attributed to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax base. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Under ASC 740, the effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. If it is more likely than not that some portion of a deferred tax asset will not be realized, a valuation allowance is recognized. Prior to the fiscal year ended March 31, 2013, the Company recognized a valuation allowance against the entire amount of the deferred tax asset. | |||
During the fiscal years ended March 31, 2014 and March 31, 2013, the Company reversed a portion of the valuation allowance as the Company determined that it is more likely than not that the deferred tax assets would be realized. As a result, approximately $0.8 million and $1.6 million of the valuation allowance were reversed during the fiscal years ended March 31, 2014 and March 31, 2013, respectively. The Company recognized an approximate tax benefit of $0.8 million and $1.6 million for the fiscal years ended March 31, 2014 and March 31, 2013, respectively. As of March 31, 2014 and March 31, 2013, The Singing Machine had net deferred tax assets and liabilities before valuation allowances of approximately $3.2 million and $3.2 million, respectively, against which the Company recorded valuation allowances totaling approximately $0.8 million and $1.6 million, respectively. | |||
The Company also follows the provisions in FASB ASC 740, Accounting for Uncertainty in Income Taxes. ASC 740 defines a recognition threshold and measurement attribute for financial statement recognition and measurements of tax positions taken or expected to be taken in a tax return. As of March 31, 2014 this position did not result in any adjustment to the Company’s provision for income taxes. Additionally, in accordance with FASB ASC 710, the Company’s policy is to recognize interest or penalties related to income tax matters in the provision for income taxes. The Company currently has no liabilities recorded for accrued interest or penalties related to uncertain tax positions. | |||
As of March 31, 2014, the Company is subject to U.S. Federal income tax examinations for the tax years ended March 31, 2011 through March 31, 2014. | |||
Impairment or Disposal of Long-Lived Assets, Policy [Policy Text Block] | ' | ||
LONG-LIVED ASSETS | |||
The Company reviews long-lived assets for impairment whenever circumstances and situations change such that there is an indication that the carrying amounts may not be recoverable. If the undiscounted future cash flows attributable to the related assets are less than the carrying amount, the carrying amounts are reduced to fair value and an impairment loss is recognized in accordance with FASB ASC 360-10-05, "Accounting for the Impairment or Disposal of Long-Lived Assets." | |||
Property, Plant and Equipment, Policy [Policy Text Block] | ' | ||
PROPERTY AND EQUIPMENT | |||
Property and equipment are stated at cost, less accumulated depreciation and amortization. Expenditures for repairs and maintenance are charged to expense as incurred. Depreciation is provided for in amounts sufficient to relate the cost of depreciable assets to their estimated useful lives using accelerated and straight-line methods. | |||
Cash and Cash Equivalents, Policy [Policy Text Block] | ' | ||
CASH | |||
The Company had cash balances at March 31, 2014 and March 31, 2013 of $1,492,141 and $1,652,996, respectively. On April 29, 2013 the Company issued a standby letter of credit in the amount of $131,068 to satisfy terms of a security deposit requirement of a new California warehouse lease agreement executed in March 2013. The Company was required to fund a restricted certificate of deposit in the amount of $138,042 as collateral for the standby letter of credit. | |||
Shipping and Handling Cost, Policy [Policy Text Block] | ' | ||
SHIPPING AND HANDLING COSTS | |||
Shipping and handling costs are classified as a component of selling expenses and those billed to customers are recorded as a reduction of expense in the consolidated statements of income. | |||
Recent Accounting Pronouncements [Policy Text Block] | ' | ||
RECENT ACCOUNTING PRONOUNCEMENTS | |||
In May 2014, the Financial Accounting Standards Board issued Accounting Standards Update (“ASU”) 2014-09 which outlines a single comprehensive model for companies to use when accounting for revenue arising from contracts with customers. The core principle of the revenue recognition model is that an entity recognizes revenue to depict the transfer of goods and services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In order to achieve this core principle a company must apply the following steps in determining revenue recognition: | |||
⋅ | Identify the contract(s) with a customer | ||
⋅ | Identify the performance obligations in the contract. | ||
⋅ | Determine the transaction price. | ||
⋅ | Allocate the transaction price to the performance obligations in the contract. | ||
⋅ | Recognize revenue when (or as) the entity satisfies a performance obligation. | ||
The amendments in this ASU are effective for annual reporting periods beginning after December 15, 2016 including interim periods within that reporting period with early application not allowed. Management is currently assessing whether the implementation of ASU 2014-09 will have any material effect on the company’s consolidated financial statements. | |||
INVENTORIES_Tables
INVENTORIES (Tables) | 12 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
Inventory Disclosure [Abstract] | ' | |||||||
Schedule of Inventory, Current [Table Text Block] | ' | |||||||
Inventories are comprised of the following components: | ||||||||
March 31, | March 31, | |||||||
2014 | 2013 | |||||||
Finished Goods | $ | 6,465,613 | $ | 4,626,407 | ||||
Less: Inventory Reserve | 638,000 | 503,000 | ||||||
Total Inventories | $ | 5,827,613 | $ | 4,123,407 | ||||
PROPERTY_AND_EQUIPMENT_Tables
PROPERTY AND EQUIPMENT (Tables) | 12 Months Ended | |||||||||
Mar. 31, 2014 | ||||||||||
Property, Plant and Equipment [Abstract] | ' | |||||||||
Property, Plant and Equipment [Table Text Block] | ' | |||||||||
A summary of property and equipment is as follows: | ||||||||||
USEFUL | MARCH 31, | MARCH 31, | ||||||||
LIFE | 2014 | 2013 | ||||||||
Computer and office equipment | 5 years | $ | 282,921 | $ | 279,742 | |||||
Furniture and fixtures | 7 years | 4,312 | 4,312 | |||||||
Leasehold improvement | * | - | 5,500 | |||||||
Warehouse equipment | 7 years | 224,106 | 136,521 | |||||||
Molds and tooling | 3-5 years | 2,324,120 | 1,849,245 | |||||||
Molds and tooling under development | ** | - | 329,500 | |||||||
2,835,459 | 2,604,820 | |||||||||
Less: Accumulated depreciation and amortization | 2,274,234 | 2,122,043 | ||||||||
$ | 561,225 | $ | 482,777 | |||||||
LONGTERM_CAPITAL_LEASE_Tables
LONG-TERM CAPITAL LEASE (Tables) | 12 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
Debt Disclosure [Abstract] | ' | |||||||
Schedule of Future Minimum Lease Payments for Capital Leases [Table Text Block] | ' | |||||||
As of March 31, 2014 and March 31, 2013, the Company had obligations under the capital lease repayable as follows: | ||||||||
March 31, 2014 | March 31, 2013 | |||||||
Total minimum lease payments | ||||||||
Within one year | $ | 12,984 | $ | - | ||||
After one year but within 3 years | 14,066 | - | ||||||
27,050 | - | |||||||
Interest payments relating to future periods | -1,268 | - | ||||||
Present Value of minimum lease payments | $ | 25,782 | $ | - | ||||
COMMITMENTS_AND_CONTINGENCIES_
COMMITMENTS AND CONTINGENCIES (Tables) | 12 Months Ended | ||||
Mar. 31, 2014 | |||||
Commitments and Contingencies Disclosure [Abstract] | ' | ||||
Schedule of Future Minimum Rental Payments for Operating Leases [Table Text Block] | ' | ||||
Future minimum lease payments under property and equipment leases with terms exceeding one year as of March 31, 2014 are as follows: | |||||
Operating Leases | |||||
For fiscal year ending March 31, | |||||
2015 | $ | 514,616 | |||
2016 | 526,496 | ||||
2017 | 534,793 | ||||
2018 | 487,672 | ||||
2019 | 518,171 | ||||
2020 and beyond | 742,718 | ||||
$ | 3,324,466 | ||||
SHAREHOLDERS_EQUITY_Tables
SHAREHOLDERS' EQUITY (Tables) | 12 Months Ended | |||||||||||||||||||
Mar. 31, 2014 | ||||||||||||||||||||
Stockholders' Equity Note [Abstract] | ' | |||||||||||||||||||
Schedule of Share-based Compensation, Stock Options, Activity [Table Text Block] | ' | |||||||||||||||||||
A summary of stock option activity for each of the years presented is summarized below. | ||||||||||||||||||||
Fiscal 2014 | Fiscal 2013 | Fiscal 2012 | ||||||||||||||||||
Number of Options | Weighted | Number of | Weighted | Number of | Weighted | |||||||||||||||
Average | Options | Average | Options | Average | ||||||||||||||||
Exercise Price | Exercise | Exercise Price | ||||||||||||||||||
Price | ||||||||||||||||||||
Stock Options: | ||||||||||||||||||||
Balance at beginning of period | 1,307,380 | $ | 0.3 | 1,251,380 | $ | 0.3 | 1,191,380 | $ | 0.56 | |||||||||||
Granted | 640,000 | 0.21 | 60,000 | $ | 0.18 | 60,000 | $ | 0.06 | ||||||||||||
Exercised | - | - | - | - | - | - | ||||||||||||||
Forfeited | -51,380 | - | -4,000 | 9 | - | - | ||||||||||||||
Balance at end of period | 1,896,000 | $ | 0.21 | 1,307,380 | $ | 0.26 | 1,251,380 | $ | 0.3 | |||||||||||
Options exercisable at end of period | 1,256,000 | $ | 0.22 | 1,247,380 | $ | 0.27 | 1,191,380 | $ | 0.31 | |||||||||||
Schedule of Share-based Compensation, Shares Authorized under Stock Option Plans, by Exercise Price Range [Table Text Block] | ' | |||||||||||||||||||
The following table summarizes information about employee stock options outstanding at March 31, 2014: | ||||||||||||||||||||
Range of Exercise Price | Number Outstanding at March | Weighted Average Remaining | Weighted Average | Number Exercisable at March | Weighted Average | |||||||||||||||
31, 2014 | Contractural Life | Exercise Price | 31, 2014 | Exercise Price | ||||||||||||||||
$.03 - $.33 | 1,622,000 | 7.4 | 0.14 | 982,000 | 0.1 | |||||||||||||||
$.45 - $.93 | 274,000 | 2.7 | 0.64 | 274,000 | 0.64 | |||||||||||||||
* | 1,896,000 | 1,256,000 | ||||||||||||||||||
Prior to April 1, 2005, in accordance with ASC 713-10, for options issued to employees, the Company applied the intrinsic value method. | ||||||||||||||||||||
* Total number of options outstanding as of March 31, 2014 includes 120,000 options issued on March 31, 2014 and 2013 to three directors as compensation and 580,000 options issue to key employees on July 1, 2013 that were not issued from the Plan. | ||||||||||||||||||||
INCOME_TAXES_Tables
INCOME TAXES (Tables) | 12 Months Ended | ||||||||||
Mar. 31, 2014 | |||||||||||
Income Tax Disclosure [Abstract] | ' | ||||||||||
Schedule of Components of Income Tax Expense (Benefit) [Table Text Block] | ' | ||||||||||
The income tax benefit for federal, foreign, and state income taxes in the consolidated statements of income consisted of the following components for 2014, 2013 and 2012: | |||||||||||
2014 | 2013 | 2012 | |||||||||
Income tax provision: | |||||||||||
Current: | |||||||||||
Federal | $ | - | $ | - | $ | - | |||||
State | - | - | - | ||||||||
Total current Federal and State | $ | - | $ | - | $ | - | |||||
Deferred: | |||||||||||
Federal | $ | -675,447 | $ | -1,412,535 | $ | - | |||||
State | -103,350 | -206,924 | - | ||||||||
Total income tax benefit | $ | -778,797 | $ | -1,619,459 | $ | - | |||||
Schedule of Income before Income Tax, Domestic and Foreign [Table Text Block] | ' | ||||||||||
The United States and foreign components of income (loss) before income taxes are as follows: | |||||||||||
2014 | 2013 | 2012 | |||||||||
United States | $ | -62,095 | $ | 92,122 | $ | -432,111 | |||||
Foreign | 287,614 | 1,429,354 | 895,227 | ||||||||
$ | 225,519 | $ | 1,521,476 | $ | 463,116 | ||||||
Schedule Of Difference Between Actual Tax Expenses And Expected Tax Expenses [Table Text Block] | ' | ||||||||||
The actual tax expense differs from the "expected" tax expense for the years ended March 31, 2014, 2013 and 2012 (computed by applying the U.S. Federal Corporate tax rate of 34 percent to income before taxes) as follows: | |||||||||||
2014 | 2013 | 2012 | |||||||||
Expected tax expense | $ | 76,676 | $ | 517,302 | $ | 157,459 | |||||
State income taxes, net of Federal income tax benefit | 7,815 | 25,236 | 26,299 | ||||||||
Permanent differences | 8,374 | 5,421 | 5,247 | ||||||||
Deemed Dividend | 108,864 | 537,866 | 304,377 | ||||||||
Change in valuation allowance | -820,040 | -2,246,235 | 385,219 | ||||||||
Tax rate differential on foreign earnings | -111,164 | -537,866 | -304,377 | ||||||||
Prior year adjustments | -49,322 | 78,817 | -574,224 | ||||||||
Actual tax benefit | $ | -778,797 | $ | -1,619,459 | $ | - | |||||
Schedule of Deferred Tax Assets and Liabilities [Table Text Block] | ' | ||||||||||
The tax effects of temporary differences that give rise to significant portions of deferred tax assets and liabilities are as follows: | |||||||||||
2014 | 2013 | 2012 | |||||||||
Deferred tax assets: | |||||||||||
Federal net operating loss carryforward | $ | 2,076,141 | $ | 2,189,622 | $ | 2,579,924 | |||||
State net operating loss carryforward | 413,401 | 413,849 | 431,306 | ||||||||
AMT credit carryforward | 36,808 | 36,808 | 70,090 | ||||||||
Inventory differences | 490,716 | 358,130 | 438,773 | ||||||||
Allowance for doubtful accounts | 66,658 | 67,849 | 57,308 | ||||||||
Reserve for sales returns | 90,895 | 81,082 | 74,718 | ||||||||
Stock option compensation expense | 59,713 | - | - | ||||||||
Stock warrants | 39,193 | - | - | ||||||||
Charitable contributions | - | - | 60,700 | ||||||||
Accrued Vacation | 10,241 | 9,839 | 9,551 | ||||||||
Depreciation and amortization | - | 81,739 | 135,660 | ||||||||
Amortization of reorganization intangible | - | - | 7,664 | ||||||||
Total deferred tax assets | 3,283,766 | 3,238,918 | 3,865,694 | ||||||||
Deferred tax liability: | |||||||||||
Depreciation | -86,091 | - | - | ||||||||
Net deferred tax asset before valuation allowance | 3,197,675 | 3,238,918 | 3,865,694 | ||||||||
Valuation allowance | -799,419 | -1,619,459 | -3,865,694 | ||||||||
Net deferred tax assets | $ | 2,398,256 | $ | 1,619,459 | $ | - | |||||
Summary of Operating Loss Carryforwards [Table Text Block] | ' | ||||||||||
Net operating loss carry forward amounts and their year of expiration are as follows: | |||||||||||
Year of | NOL | NOL | |||||||||
Expiration | Federal | State | |||||||||
2014 | $ | - | $ | - | |||||||
2015 | - | 1,984,929 | |||||||||
2016 | - | - | |||||||||
2017 | - | - | |||||||||
2018 | - | - | |||||||||
2019 and beyond | 6,106,299 | 6,884,857 | |||||||||
$ | 6,106,299 | $ | 8,869,786 | ||||||||
SEGMENT_INFORMATION_Tables
SEGMENT INFORMATION (Tables) | 12 Months Ended | ||||||||||
Mar. 31, 2014 | |||||||||||
Segment Reporting [Abstract] | ' | ||||||||||
Schedule of Revenue from External Customers and Long-Lived Assets, by Geographical Areas [Table Text Block] | ' | ||||||||||
Sales by geographic region for the period presented are as follows: | |||||||||||
2014 | 2013 | 2012 | |||||||||
North America | $ | 31,379,629 | $ | 34,068,559 | $ | 25,313,446 | |||||
Europe | - | 369,215 | 630,386 | ||||||||
$ | 31,379,629 | $ | 34,437,774 | $ | 25,943,832 | ||||||
QUARTERLY_FINANCIAL_DATA_UNAUD1
QUARTERLY FINANCIAL DATA - UNAUDITED (Tables) | 12 Months Ended | ||||||||||||||||
Mar. 31, 2014 | |||||||||||||||||
Quarterly Financial Data [Abstract] | ' | ||||||||||||||||
Schedule of Quarterly Financial Information [Table Text Block] | ' | ||||||||||||||||
The quarterly unaudited results for the years 2014, 2013, and 2012 are set forth in the following table: | |||||||||||||||||
Sales | Gross Profit | Net Earnings | Basic | Diluted | |||||||||||||
(Loss) | Earnings | Earnings | |||||||||||||||
(Loss) | (Loss) | ||||||||||||||||
Per Share | Per Share | ||||||||||||||||
(In thousands) | (In thousands) | (In thousands) | |||||||||||||||
2014 | |||||||||||||||||
First quarter | $ | 1,414 | $ | 301 | $ | -541 | $ | -0.01 | $ | -0.01 | |||||||
Second quarter | 10,835 | 2,403 | 324 | 0.01 | 0.01 | ||||||||||||
Third quarter | 16,815 | 4,107 | 821 | 0.02 | 0.02 | ||||||||||||
Fourth quarter | 2,316 | 296 | 400 | 0 | 0 | ||||||||||||
Fiscal Year 2014 | $ | 31,380 | $ | 7,107 | $ | 1,004 | $ | 0.02 | $ | 0.02 | |||||||
2013 | |||||||||||||||||
First quarter | $ | 1,763 | $ | 444 | $ | -480 | $ | -0.01 | $ | -0.01 | |||||||
Second quarter | 14,376 | 3,471 | 1,435 | 0.04 | 0.04 | ||||||||||||
Third quarter | 16,617 | 4,022 | 1,397 | 0.04 | 0.04 | ||||||||||||
Fourth quarter | 1,682 | 132 | 789 | 0.01 | 0.01 | ||||||||||||
Fiscal Year 2013 | $ | 34,438 | $ | 8,069 | $ | 3,141 | $ | 0.08 | $ | 0.08 | |||||||
2012 | |||||||||||||||||
First quarter | $ | 1,788 | $ | 429 | $ | -507 | $ | -0.01 | $ | -0.01 | |||||||
Second quarter | 14,150 | 3,193 | 1,466 | 0.04 | 0.04 | ||||||||||||
Third quarter | 8,651 | 1,796 | 134 | 0 | 0 | ||||||||||||
Fourth quarter | 1,355 | 233 | -630 | -0.02 | -0.02 | ||||||||||||
Fiscal Year 2012 | $ | 25,944 | $ | 5,651 | $ | 463 | $ | 0.01 | $ | 0.01 | |||||||
WARRANTY_PROVISIONS_Tables
WARRANTY PROVISIONS (Tables) | 12 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
Product Warranties Disclosures [Abstract] | ' | |||||||
Schedule of Product Warranty Liability [Table Text Block] | ' | |||||||
Changes in the Company’s obligations for return and allowance programs are presented in the following table: | ||||||||
Fiscal Year Ended | ||||||||
March 31, | March 31, | |||||||
2014 | 2013 | |||||||
Estimated return and allowance liabilities at beginning of period | $ | 215,471 | $ | 219,760 | ||||
Costs accrued for new estimated returns and allowances | 826,577 | 1,183,134 | ||||||
Return and allowance obligations honored | -806,876 | -1,187,423 | ||||||
Estimated return and allowance liabilities at end of period | $ | 235,172 | $ | 215,471 | ||||
BASIS_OF_PRESENTATION_Details_
BASIS OF PRESENTATION (Details Textual) | Mar. 31, 2014 |
Schedule of Equity Method Investments [Line Items] | ' |
Equity Method Investment, Ownership Percentage | 52.00% |
SUMMARY_OF_SIGNIFICANT_ACCOUNT2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Textual) (USD $) | 12 Months Ended | ||
Mar. 31, 2014 | Mar. 31, 2013 | Mar. 31, 2012 | |
Accounting Policies [Line Items] | ' | ' | ' |
Percentage Of Reserves For Customers | 100.00% | ' | ' |
Cash, FDIC Insured Amount | $250,000 | ' | ' |
Exceeded Cash Deposits In FDIC Insurance Limit | 964,282 | 1,007,984 | ' |
Concentration Risk Credit Risk Cash Balance in Foreign Financial Institutions | 277,859 | 256,035 | ' |
Stock or Unit Option Plan Expense | 99,851 | 7,277 | 18,530 |
Cooperative Advertising Allowance Minimum Percentage (in percentage) | 2.00% | ' | ' |
Cooperative Advertising Allowance Maximum Percentage (in percentage) | 8.00% | ' | ' |
Advertising Expense | 1,120,711 | 1,688,692 | 1,089,512 |
Research and Development Expense | 200,551 | 70,870 | 37,852 |
Concentration Risk, Percentage | 8.00% | 8.80% | 7.70% |
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Dividend Rate | 0.00% | 0.00% | 0.00% |
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Risk Free Interest Rate, Minimum | 0.13% | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Risk Free Interest Rate, Maximum | 0.15% | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Volatility Rate | ' | 304.70% | 341.40% |
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Volatility Rate, Minimum | 201.10% | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Volatility Rate, Maximum | 304.10% | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Risk Free Interest Rate | ' | 0.14% | 0.19% |
Deferred Tax Assets, Valuation Allowance | 799,419 | 1,619,459 | 3,865,694 |
Deferred Tax Assets, Gross | 3,283,766 | 3,238,918 | 3,865,694 |
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Term | '3 years | '1 year | '1 year |
Cash Equivalents, at Carrying Value | 1,492,141 | 1,652,996 | ' |
Issuance Of Letter Of Credit | ' | 131,068 | ' |
Certificate Of Deposit | 138,042 | ' | ' |
Valuation Allowance, Deferred Tax Asset, Change in Amount | 800,000 | 1,600,000 | ' |
Deferred Income Tax Expense (Benefit) | $800,000 | $1,600,000 | ' |
INVENTORIES_Details
INVENTORIES (Details) (USD $) | Mar. 31, 2014 | Mar. 31, 2013 |
Inventory [Line Items] | ' | ' |
Finished Goods | $6,465,613 | $4,626,407 |
Less: Inventory Reserve | 638,000 | 503,000 |
Total Inventories | $5,827,613 | $4,123,407 |
INVENTORIES_Details_Textual
INVENTORIES (Details Textual) (USD $) | Mar. 31, 2014 | Mar. 31, 2013 |
Inventory [Line Items] | ' | ' |
Other Inventory, Materials, Supplies and Merchandise under Consignment | $353,201 | $353,201 |
PROPERTY_AND_EQUIPMENT_Details
PROPERTY AND EQUIPMENT (Details) (USD $) | 12 Months Ended | ||
Mar. 31, 2014 | Mar. 31, 2013 | ||
Property, Plant and Equipment [Line Items] | ' | ' | |
Property, Plant and Equipment, Gross | $2,835,459 | $2,604,820 | |
Accumulated depreciation | 2,274,234 | 2,122,043 | |
Property and equipment, net | 561,225 | 482,777 | |
Computer and Office Equipment [Member] | ' | ' | |
Property, Plant and Equipment [Line Items] | ' | ' | |
Property, Plant and Equipment, Gross | 282,921 | 279,742 | |
Average useful life (in years) | '5 years | ' | |
Furniture and Fixtures [Member] | ' | ' | |
Property, Plant and Equipment [Line Items] | ' | ' | |
Property, Plant and Equipment, Gross | 4,312 | 4,312 | |
Average useful life (in years) | '7 years | ' | |
Leasehold Improvements [Member] | ' | ' | |
Property, Plant and Equipment [Line Items] | ' | ' | |
Property, Plant and Equipment, Gross | 0 | 5,500 | |
Average useful life (in years) | ' | [1] | ' |
Warehouse Equipment [Member] | ' | ' | |
Property, Plant and Equipment [Line Items] | ' | ' | |
Property, Plant and Equipment, Gross | 224,106 | 136,521 | |
Average useful life (in years) | '7 years | ' | |
Molds and tooling under development [Member] | ' | ' | |
Property, Plant and Equipment [Line Items] | ' | ' | |
Property, Plant and Equipment, Gross | 0 | 329,500 | |
Average useful life (in years) | ' | [2] | ' |
Molds and tooling [Member] | ' | ' | |
Property, Plant and Equipment [Line Items] | ' | ' | |
Property, Plant and Equipment, Gross | $2,324,120 | $1,849,245 | |
Molds and tooling [Member] | Minimum [Member] | ' | ' | |
Property, Plant and Equipment [Line Items] | ' | ' | |
Average useful life (in years) | '3 years | ' | |
Molds and tooling [Member] | Maximum [Member] | ' | ' | |
Property, Plant and Equipment [Line Items] | ' | ' | |
Average useful life (in years) | '5 years | ' | |
[1] | Shorter of remaining term of lease or useful life | ||
[2] | As of the fiscal years ended March 31, 2014, 2013 and 2012 the Company had outstanding commitments for molds and tooling in process in the amounts of approximately $0, $140,000 and $0, respectively. |
PROPERTY_AND_EQUIPMENT_Details1
PROPERTY AND EQUIPMENT (Details Textual) (USD $) | 12 Months Ended | ||
Mar. 31, 2014 | Mar. 31, 2013 | Mar. 31, 2012 | |
Property, Plant and Equipment [Line Items] | ' | ' | ' |
Depreciation | $168,138 | $110,267 | $171,818 |
Outstanding Commitments For Molds and Toolings | $0 | $140,000 | $0 |
DUE_TO_RELATED_PARTIES_NET_Det
DUE TO RELATED PARTIES, NET (Details Textual) (USD $) | Mar. 31, 2014 | Mar. 31, 2013 |
Karaoke Hardware [Member] | ' | ' |
Related Party Transaction [Line Items] | ' | ' |
Due to Related Parties, Current | $4,925,982 | $4,212,783 |
Starlight Marketing Development, Ltd [Member] | ' | ' |
Related Party Transaction [Line Items] | ' | ' |
Due to Related Parties, Current | 1,107,678 | 1,107,678 |
Ram Light Management, Ltd [Member] | ' | ' |
Related Party Transaction [Line Items] | ' | ' |
Due to Related Parties, Current | 1,683,247 | 1,683,247 |
Starlight Consumer Electronics Co Ltd [Member] | ' | ' |
Related Party Transaction [Line Items] | ' | ' |
Due to Related Parties, Current | 1,051,913 | 585,125 |
Starlight R and D, Ltd [Member] | ' | ' |
Related Party Transaction [Line Items] | ' | ' |
Due to Related Parties, Current | 194,678 | 419,600 |
Other Starlight Group Companies [Member] | ' | ' |
Related Party Transaction [Line Items] | ' | ' |
Due to Related Parties, Current | 3,534 | 3,534 |
Due From Related Parties, Current | $367,520 | $399,620 |
OBLIGATIONS_TO_CLIENTS_FOR_RET1
OBLIGATIONS TO CLIENTS FOR RETURNS AND ALLOWANCES (Details Textual) (USD $) | Mar. 31, 2014 | Mar. 31, 2013 |
Obligations To Clients For Returns And Allowances [Line Items] | ' | ' |
Customer Refund Liability, Current | $469,838 | $376,289 |
Accounts Receivable [Member] | ' | ' |
Obligations To Clients For Returns And Allowances [Line Items] | ' | ' |
Customer Refund Liability, Current | 469,838 | 376,289 |
Accounts Payable [Member] | ' | ' |
Obligations To Clients For Returns And Allowances [Line Items] | ' | ' |
Customer Refund Liability, Current | $0 | $636,474 |
LINE_OF_CREDIT_Details_Textual
LINE OF CREDIT (Details Textual) (USD $) | 12 Months Ended | ||
Mar. 31, 2014 | Mar. 31, 2013 | Mar. 31, 2012 | |
Line of Credit Facility [Line Items] | ' | ' | ' |
Line of Credit Facility, Increase, Accrued Interest | $45,887 | $28,714 | $0 |
Percentage Of Factoring Fees | 1.00% | ' | ' |
Percentage Of Discount On Accounts Receivable Advances | 2.00% | ' | ' |
Line of Credit Facility, Interest Rate During Period | 5.25% | ' | ' |
Due to Related Parties | 2,500,000 | ' | ' |
Line of Credit Facility, Borrowing Capacity, Description | 'the Company to receive an advance of up to 70% of qualified accounts receivable. | ' | ' |
Factoring Fees | 239,829 | 126,781 | 0 |
Ram Light Mnagement, Ltd., [Member] | ' | ' | ' |
Line of Credit Facility [Line Items] | ' | ' | ' |
Due to Related Parties | 1,683,247 | ' | ' |
Starlight Marketing Development, Ltd [Member] | ' | ' | ' |
Line of Credit Facility [Line Items] | ' | ' | ' |
Due to Related Parties | 816,753 | ' | ' |
Peak Selling Season before February 14 [Member] | ' | ' | ' |
Line of Credit Facility [Line Items] | ' | ' | ' |
Line of Credit Facility, Maximum Amount Outstanding During Period | 5,000,000 | ' | ' |
Peak Selling Season After February 14 [Member] | ' | ' | ' |
Line of Credit Facility [Line Items] | ' | ' | ' |
Line of Credit Facility, Maximum Amount Outstanding During Period | $500,000 | ' | ' |
LONGTERM_CAPITAL_LEASE_Details
LONG-TERM CAPITAL LEASE (Details) (USD $) | Mar. 31, 2014 | Mar. 31, 2013 |
Total minimum lease payments | ' | ' |
Within one year | $12,984 | $0 |
After one year but within 3 years | 14,066 | 0 |
Minimum Lease Payments, Sale Leaseback Transactions, Total | 27,050 | 0 |
Interest payments relating to future periods | -1,268 | 0 |
Present Value of minimum lease payments | $25,782 | $0 |
LONGTERM_CAPITAL_LEASE_Details1
LONG-TERM CAPITAL LEASE (Details Textual) (USD $) | 12 Months Ended | 1 Months Ended | ||||||
Mar. 31, 2014 | Mar. 31, 2013 | Mar. 31, 2012 | Apr. 13, 2013 | 31-May-13 | Apr. 30, 2013 | Mar. 31, 2014 | Mar. 31, 2013 | |
Wells Fargo Equipment Finance [Member] | Wells Fargo Equipment Finance [Member] | Wells Fargo Equipment Finance [Member] | Wells Fargo Equipment Finance [Member] | |||||
Long Term Capital Lease [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' |
Long-term Debt and Capital Lease Obligations, Total | ' | ' | ' | $38,952 | ' | ' | ' | ' |
Capital Lease Obligations Incurred | 36,388 | 0 | 0 | ' | ' | ' | ' | ' |
Monthly Lease Payments | ' | ' | ' | ' | 1,082 | ' | ' | ' |
Lease term | ' | ' | ' | ' | '36 months | ' | ' | ' |
Long Term Capital Lease Interest Rate | ' | ' | ' | ' | ' | 4.50% | ' | ' |
Payments to Acquire Equipment on Lease | 1,296 | 0 | ' | ' | ' | ' | ' | ' |
Capital Leases, Future Minimum Payments, Present Value of Net Minimum Payments, Total | $25,782 | $0 | ' | ' | ' | ' | $25,782 | $0 |
COMMITMENTS_AND_CONTINGENCIES_1
COMMITMENTS AND CONTINGENCIES (Details) (USD $) | Mar. 31, 2014 |
Commitments And Contingencies [Line Items] | ' |
2015 | $514,616 |
2016 | 526,496 |
2017 | 534,793 |
2018 | 487,672 |
2019 | 518,171 |
2020 and beyond | 742,718 |
Operating Leases, Future Minimum Payments Due | $3,324,466 |
COMMITMENTS_AND_CONTINGENCIES_2
COMMITMENTS AND CONTINGENCIES (Details Textual) (USD $) | 1 Months Ended | 12 Months Ended | ||||
Jun. 30, 2009 | Mar. 31, 2014 | Mar. 31, 2013 | Mar. 31, 2012 | Mar. 08, 2013 | Jul. 21, 2008 | |
sqft | ||||||
Commitments And Contingencies [Line Items] | ' | ' | ' | ' | ' | ' |
Accrued Income Taxes | ' | ' | ' | ' | ' | $241,639 |
Unrecognized Tax Benefits, Income Tax Penalties and Interest Accrued | ' | ' | ' | ' | ' | 74,125 |
Federal Income Tax Expense (Benefit), Continuing Operations | 170,000 | ' | ' | ' | ' | ' |
Operating Leases, Rent Expense, Net | ' | 611,977 | 731,907 | 800,198 | ' | ' |
Area of Land | ' | ' | ' | ' | 86,000 | ' |
Deferred Leasing Commissions | ' | ' | ' | ' | 113,412 | ' |
Lease Expiration Date | ' | ' | 31-Aug-20 | ' | ' | ' |
Operating Leases, Rent Expense, Sublease Rentals | ' | $56,000 | $56,000 | $0 | ' | ' |
SHAREHOLDERS_EQUITY_Details
SHAREHOLDERS' EQUITY (Details) (USD $) | 12 Months Ended | |||
Mar. 31, 2014 | Mar. 31, 2013 | Mar. 31, 2012 | ||
Share-based Compensation, Stock Options, Activity [Line Items] | ' | ' | ' | |
Number of Options Balance at beginning of period | 1,307,380 | 1,251,380 | 1,191,380 | |
Number of Options Granted | 640,000 | 60,000 | 60,000 | |
Number of Options Exercised | 0 | 0 | 0 | |
Number of Options Forfeied | -51,380 | -4,000 | 0 | |
Number of Options Balance at end of period | 1,896,000 | [1] | 1,307,380 | 1,251,380 |
Weighted Average Exercise Price Balance at beginning of period | $0.30 | $0.30 | $0.56 | |
Weighted Average Exercise Price Granted | $0.21 | $0.18 | $0.06 | |
Weighted Average Exercise Price Exercised | $0 | $0 | $0 | |
Weighted Average Exercise Price Forfeited | $0 | $9 | $0 | |
Weighted Average Exercise Price Balance at end of period | $0.21 | $0.30 | $0.30 | |
Weighted Average Exercise Price Options exercisable at end of period | $0.22 | $0.27 | $0.31 | |
Options exercisable at end of period | 1,256,000 | 1,247,380 | 1,191,380 | |
[1] | Total number of options outstanding as of March 31, 2014 includes 120,000 options issued on March 31, 2014 and 2013 to three directors as compensation and 580,000 options issue to key employees on July 1, 2013 that were not issued from the Plan. |
SHAREHOLDERS_EQUITY_Details_1
SHAREHOLDERS' EQUITY (Details 1) (USD $) | Mar. 31, 2014 | Mar. 31, 2013 | Mar. 31, 2012 | Mar. 31, 2011 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | |
Stock Option One [Member] | Stock Option One [Member] | Stock Option One [Member] | Stock Option Two [Member] | Stock Option Two [Member] | Stock Option Two [Member] | ||||||
Minimum [Member] | Maximum [Member] | Minimum [Member] | Maximum [Member] | ||||||||
Share-based Compensation, Stock Options, Activity [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |
Stock Options Outstanding Range of Exercise Price | ' | ' | ' | ' | ' | $0.03 | $0.33 | ' | $0.45 | $0.93 | |
Stock Options Number Outstanding | 1,896,000 | [1] | 1,307,380 | 1,251,380 | 1,191,380 | 1,622,000 | ' | ' | 274,000 | ' | ' |
Stock Option Outstanding Weighted Average Remaining Contractural Life | ' | ' | ' | ' | '7 years 4 months 24 days | ' | ' | '2 years 8 months 12 days | ' | ' | |
Stock Option Outstanding Weighted Average Exercise Price | ' | ' | ' | ' | $0.14 | ' | ' | $0.64 | ' | ' | |
Stock Option Outstanding Number Exercisable | 1,256,000 | [1] | ' | ' | ' | 982,000 | ' | ' | 274,000 | ' | ' |
Stock Option Outstanding Weighted Average Exercise Price | ' | ' | ' | ' | $0.10 | ' | ' | $0.64 | ' | ' | |
[1] | Total number of options outstanding as of March 31, 2014 includes 120,000 options issued on March 31, 2014 and 2013 to three directors as compensation and 580,000 options issue to key employees on July 1, 2013 that were not issued from the Plan. |
SHAREHOLDERS_EQUITY_Details_Te
SHAREHOLDERS' EQUITY (Details Textual) (USD $) | 12 Months Ended | 1 Months Ended | ||||||||
Mar. 31, 2014 | Mar. 31, 2013 | Mar. 31, 2012 | Mar. 31, 2011 | Jul. 31, 2013 | Mar. 31, 2014 | Jul. 23, 2013 | Jan. 24, 2013 | Dec. 02, 2011 | ||
Annual Director Compensation Plan [Member] | Annual Director Compensation Plan [Member] | Annual Director Compensation Plan [Member] | Annual Director Compensation Plan [Member] | Annual Director Compensation Plan [Member] | ||||||
Shareholders' Equity [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Number, Ending Balance | 1,896,000 | [1] | 1,307,380 | 1,251,380 | 1,191,380 | ' | 120,000 | ' | ' | ' |
Common Stock, Shares, Issued | 38,070,642 | 38,028,975 | ' | ' | ' | ' | 41,667 | 68,181 | 125,001 | |
Common Stock, Par Or Stated Value Per Share | $0.01 | $0.01 | ' | ' | ' | ' | $0.18 | $0.11 | $0.06 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Net of Forfeitures, Total | ' | ' | ' | ' | 580,000 | ' | ' | ' | ' | |
Dilutive Potential Securities | 820,000 | 820,000 | ' | ' | ' | ' | ' | ' | ' | |
Stock Issued During Period, Shares, New Issues | 1,256,000 | 1,251,380 | 700,000 | ' | ' | ' | ' | ' | ' | |
[1] | Total number of options outstanding as of March 31, 2014 includes 120,000 options issued on March 31, 2014 and 2013 to three directors as compensation and 580,000 options issue to key employees on July 1, 2013 that were not issued from the Plan. |
INCOME_TAXES_Details
INCOME TAXES (Details) (USD $) | 12 Months Ended | ||
Mar. 31, 2014 | Mar. 31, 2013 | Mar. 31, 2012 | |
Current: | ' | ' | ' |
Federal | $0 | $0 | $0 |
State | 0 | 0 | 0 |
Total current Federal and State | 0 | 0 | 0 |
Deferred: | ' | ' | ' |
Federal | -675,447 | -1,412,535 | 0 |
State | -103,350 | -206,924 | 0 |
Total income tax benefit | ($778,797) | ($1,619,459) | $0 |
INCOME_TAXES_Details_1
INCOME TAXES (Details 1) (USD $) | 12 Months Ended | ||
Mar. 31, 2014 | Mar. 31, 2013 | Mar. 31, 2012 | |
Income before Income Tax, Domestic and Foreign [Line Items] | ' | ' | ' |
United States | ($62,095) | $92,122 | ($432,111) |
Foreign | 287,614 | 1,429,354 | 895,227 |
Net Income (Loss) before income tax benefit | $225,519 | $1,521,476 | $463,116 |
INCOME_TAXES_Details_2
INCOME TAXES (Details 2) (USD $) | 12 Months Ended | ||
Mar. 31, 2014 | Mar. 31, 2013 | Mar. 31, 2012 | |
Difference Between Actual Tax Expenses And Expected Tax Expenses [Line Items] | ' | ' | ' |
Expected tax expense | $76,676 | $517,302 | $157,459 |
State income taxes, net of Federal income tax benefit | 7,815 | 25,236 | 26,299 |
Permanent differences | 8,374 | 5,421 | 5,247 |
Deemed Dividend | 108,864 | 537,866 | 304,377 |
Change in valuation allowance | -820,040 | -2,246,235 | 385,219 |
Tax rate differential on foreign earnings | -111,164 | -537,866 | -304,377 |
Prior year adjustments | -49,322 | 78,817 | -574,224 |
Actual tax benefit | ($778,797) | ($1,619,459) | $0 |
INCOME_TAXES_Details_3
INCOME TAXES (Details 3) (USD $) | Mar. 31, 2014 | Mar. 31, 2013 | Mar. 31, 2012 |
Deferred tax assets: | ' | ' | ' |
Federal net operating loss carryforward | $2,076,141 | $2,189,622 | $2,579,924 |
State net operating loss carryforward | 413,401 | 413,849 | 431,306 |
AMT credit carryforward | 36,808 | 36,808 | 70,090 |
Inventory differences | 490,716 | 358,130 | 438,773 |
Allowance for doubtful accounts | 66,658 | 67,849 | 57,308 |
Reserve for sales returns | 90,895 | 81,082 | 74,718 |
Stock option compensation expense | 59,713 | 0 | 0 |
Stock warrants | 39,193 | 0 | 0 |
Charitable contributions | 0 | 0 | 60,700 |
Accrued Vacation | 10,241 | 9,839 | 9,551 |
Depreciation and amortization | 0 | 81,739 | 135,660 |
Amortization of reorganization intangible | 0 | 0 | 7,664 |
Total deferred tax assets | 3,283,766 | 3,238,918 | 3,865,694 |
Deferred tax liability: | ' | ' | ' |
Depreciation | -86,091 | 0 | 0 |
Net deferred tax asset before valuation allowance | 3,197,675 | 3,238,918 | 3,865,694 |
Valuation allowance | -799,419 | -1,619,459 | -3,865,694 |
Net deferred tax assets | $2,398,256 | $1,619,459 | $0 |
INCOME_TAXES_Details_4
INCOME TAXES (Details 4) (USD $) | Mar. 31, 2014 |
Domestic Tax Authority [Member] | ' |
Schedule Of Operating Loss Carry forwards [Line Items] | ' |
2014 | $0 |
2015 | 0 |
2016 | 0 |
2017 | 0 |
2018 | 0 |
2019 and beyond | 6,106,299 |
Total | 6,106,299 |
State and Local Jurisdiction [Member] | ' |
Schedule Of Operating Loss Carry forwards [Line Items] | ' |
2014 | 0 |
2015 | 1,984,929 |
2016 | 0 |
2017 | 0 |
2018 | 0 |
2019 and beyond | 6,884,857 |
Total | $8,869,786 |
INCOME_TAXES_Details_Textual
INCOME TAXES (Details Textual) (USD $) | 12 Months Ended | ||
Mar. 31, 2014 | Mar. 31, 2013 | Mar. 31, 2012 | |
Income Taxes [Line Items] | ' | ' | ' |
Net deferred tax assets before valuation allowance | $3,283,766 | $3,238,918 | $3,865,694 |
Valuation allowance | 799,419 | 1,619,459 | 3,865,694 |
Deferred Income Tax Expense (Benefit) | 800,000 | 1,600,000 | ' |
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent | 34.00% | ' | ' |
Valuation Allowance, Deferred Tax Asset, Change in Amount | 800,000 | 1,600,000 | ' |
Domestic Tax Authority [Member] | ' | ' | ' |
Income Taxes [Line Items] | ' | ' | ' |
Operating Loss Carryforwards | 6,106,299 | ' | ' |
Operating Loss Carry Forwards Expiration Period | 'expire beginning in the year 2027 | ' | ' |
State and Local Jurisdiction [Member] | ' | ' | ' |
Income Taxes [Line Items] | ' | ' | ' |
Operating Loss Carryforwards | $8,869,786 | ' | ' |
Operating Loss Carry Forwards Expiration Period | 'expire beginning in 2015 | ' | ' |
SEGMENT_INFORMATION_Details
SEGMENT INFORMATION (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||||||
Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2011 | Sep. 30, 2011 | Jun. 30, 2011 | Mar. 31, 2014 | Mar. 31, 2013 | Mar. 31, 2012 | |
Segment Reporting Information [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net Sales | $2,316,000 | $16,815,000 | $10,835,000 | $1,414,000 | $1,682,000 | $16,617,000 | $14,376,000 | $1,763,000 | $1,355,000 | $8,651,000 | $14,150,000 | $1,788,000 | $31,379,629 | $34,437,774 | $25,943,832 |
North America [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net Sales | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 31,379,629 | 34,068,559 | 25,313,446 |
Europe [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net Sales | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $0 | $369,215 | $630,386 |
EMPLOYEE_BENEFIT_PLANS_Details
EMPLOYEE BENEFIT PLANS (Details Textual) (USD $) | 12 Months Ended | ||
Mar. 31, 2014 | Mar. 31, 2013 | Mar. 31, 2012 | |
Defined Benefit Plan Disclosure [Line Items] | ' | ' | ' |
Defined Contribution Plan, Administrative Expenses | $27,869 | $30,589 | $24,933 |
CONCENTRATIONS_OF_CREDIT_RISK_1
CONCENTRATIONS OF CREDIT RISK, CUSTOMERS, AND SUPPLIERS (Details Textual) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||||||
Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2011 | Sep. 30, 2011 | Jun. 30, 2011 | Mar. 31, 2014 | Mar. 31, 2013 | Mar. 31, 2012 | |
Concentration Risk [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Concentration Risk Percentage For Accounts Receivable More Than 10 Percentage One | 40.00% | ' | ' | ' | 53.00% | ' | ' | ' | ' | ' | ' | ' | 40.00% | 53.00% | ' |
Concentration Risk Percentage For Accounts Receivable More Than 10 Percentage Two | 29.00% | ' | ' | ' | 18.00% | ' | ' | ' | ' | ' | ' | ' | 29.00% | 18.00% | ' |
Concentration Risk Percentage For Accounts Receivable More Than 10 Percentage Three | 11.00% | ' | ' | ' | 11.00% | ' | ' | ' | ' | ' | ' | ' | 11.00% | 11.00% | ' |
Concentration Risk, Percentage | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 8.00% | 8.80% | 7.70% |
Sales Revenue, Goods, Net | $2,316,000 | $16,815,000 | $10,835,000 | $1,414,000 | $1,682,000 | $16,617,000 | $14,376,000 | $1,763,000 | $1,355,000 | $8,651,000 | $14,150,000 | $1,788,000 | $31,379,629 | $34,437,774 | $25,943,832 |
Total Product Purchases Percentage | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 99.00% | 99.00% | 99.00% |
Total Three Customers [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Concentration Risk [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Concentration Risk Percentage For Accounts Receivable | 80.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 80.00% | ' | ' |
Total Five Customers [Member] | Sales [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Concentration Risk [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Concentration Risk, Percentage | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 74.00% | 66.00% | 70.00% |
Customer One [Member] | Sales [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Concentration Risk [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Concentration Risk, Percentage | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 26.00% | 17.00% | 11.00% |
Customer Two [Member] | Sales [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Concentration Risk [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Concentration Risk, Percentage | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 23.00% | 21.00% | 13.00% |
Customer Three [Member] | Sales [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Concentration Risk [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Concentration Risk, Percentage | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 29.00% | 17.00% | 15.00% |
Macau [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Concentration Risk [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Sales Revenue, Goods, Net | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $9,300,000 | $12,500,000 | $11,800,000 |
QUARTERLY_FINANCIAL_DATA_UNAUD2
QUARTERLY FINANCIAL DATA - UNAUDITED (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||||||
Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2011 | Sep. 30, 2011 | Jun. 30, 2011 | Mar. 31, 2014 | Mar. 31, 2013 | Mar. 31, 2012 | |
Quarterly Financial Data [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Sales | $2,316,000 | $16,815,000 | $10,835,000 | $1,414,000 | $1,682,000 | $16,617,000 | $14,376,000 | $1,763,000 | $1,355,000 | $8,651,000 | $14,150,000 | $1,788,000 | $31,379,629 | $34,437,774 | $25,943,832 |
Gross Profit | 296,000 | 4,107,000 | 2,403,000 | 301,000 | 132,000 | 4,022,000 | 3,471,000 | 444,000 | 233,000 | 1,796,000 | 3,193,000 | 429,000 | 7,106,591 | 8,068,829 | 5,651,094 |
Net Earnings (Loss) | $400,000 | $821,000 | $324,000 | ($541,000) | $789,000 | $1,397,000 | $1,435,000 | ($480,000) | ($630,000) | $134,000 | $1,466,000 | ($507,000) | $1,004,316 | $3,140,935 | $463,116 |
Basic Earnings (Loss) Per Share (in dollars per share) | $0 | $0.02 | $0.01 | ($0.01) | $0.01 | $0.04 | $0.04 | ($0.01) | ($0.02) | $0 | $0.04 | ($0.01) | $0.03 | $0.08 | $0.01 |
Diluted Earnings (Loss) Per Share (in dollars per share) | $0 | $0.02 | $0.01 | ($0.01) | $0.01 | $0.04 | $0.04 | ($0.01) | ($0.02) | $0 | $0.04 | ($0.01) | $0.03 | $0.08 | $0.01 |
RELATED_PARTY_TRANSACTIONS_Det
RELATED PARTY TRANSACTIONS (Details Textual) (USD $) | 1 Months Ended | 12 Months Ended | |
Jul. 31, 2012 | Mar. 31, 2014 | Mar. 31, 2013 | |
Related Party Transaction [Line Items] | ' | ' | ' |
Monthly Service Fee | $435,000 | ' | ' |
Proceeds from Fees Received | ' | 330,000 | 0 |
Warehouse space Square Foot Value | ' | 0.5 | ' |
Reimbursement Paid | ' | 145,000 | 96,000 |
Reimbursement Revenue | ' | 60,000 | 60,000 |
Warehouse Space Per Pallet | ' | $8 | ' |
Subsequent Event [Member] | ' | ' | ' |
Related Party Transaction [Line Items] | ' | ' | ' |
Monthly Service Fee | ' | 180,000 | ' |
Agreement Expiration Date | ' | 31-Mar-15 | ' |
Affiliated Entity [Member] | ' | ' | ' |
Related Party Transaction [Line Items] | ' | ' | ' |
Proceeds from Fees Received | ' | 0 | 399,000 |
Starlight Electronics Co., Ltd [Member] | ' | ' | ' |
Related Party Transaction [Line Items] | ' | ' | ' |
Related Party Transaction, Other Revenues from Transactions with Related Party | ' | 1,861,000 | 1,813,000 |
Starlight Consumer Electronics Usa, Inc [Member] | ' | ' | ' |
Related Party Transaction [Line Items] | ' | ' | ' |
Related Party Purchases From Related Party Transaction One | ' | 8,012,000 | 4,932,000 |
Freight Costs | ' | 109,000 | 54,000 |
Starlight Consumer Electronics Usa, Inc [Member] | Affiliated Entity [Member] | ' | ' | ' |
Related Party Transaction [Line Items] | ' | ' | ' |
Proceeds from Fees Received | ' | 0 | 250,000 |
Star Fair Electronics Co Ltd [Member] | ' | ' | ' |
Related Party Transaction [Line Items] | ' | ' | ' |
Related Party Transaction, Expenses from Transactions with Related Party | ' | 873,000 | 3,061,000 |
Repair Charges | ' | 52,000 | 39,000 |
Starlight Rd, Ltd [Member] | ' | ' | ' |
Related Party Transaction [Line Items] | ' | ' | ' |
Related Party Transaction, Expenses from Transactions with Related Party | ' | 2,000 | 21,000 |
Freight Costs | ' | 263,000 | 229,000 |
Cosmo Communications Usa, Inc [Member] | ' | ' | ' |
Related Party Transaction [Line Items] | ' | ' | ' |
Related Party Transaction, Revenues from Transactions with Related Party | ' | 1,318,000 | 410,000 |
Related Party Gross Margin Percentage (in percentage) | ' | 16.20% | 14.40% |
Related Party Purchases From Related Party Transaction One | ' | 41,000 | 286,000 |
Starlight Group [Member] | Fiscal 2014 [Member] | ' | ' | ' |
Related Party Transaction [Line Items] | ' | ' | ' |
Percentage Of Karaoke Products Owned By Factories | ' | 35.00% | ' |
Starlight Group [Member] | Fiscal 2015 [Member] | ' | ' | ' |
Related Party Transaction [Line Items] | ' | ' | ' |
Percentage Of Total Manufactured Products | ' | 30.00% | ' |
Cosmo Communications Canada [Member] | ' | ' | ' |
Related Party Transaction [Line Items] | ' | ' | ' |
Related Party Purchases From Related Party Transaction One | ' | $114,000 | $0 |
WARRANTY_PROVISIONS_Details
WARRANTY PROVISIONS (Details) (USD $) | 12 Months Ended | |
Mar. 31, 2014 | Mar. 31, 2013 | |
Warranty Provisions [Line Items] | ' | ' |
Estimated return and allowance liabilities at beginning of period | $215,471 | $219,760 |
Costs accrued for new estimated returns and allowances | 826,577 | 1,183,134 |
Return and allowance obligations honored | -806,876 | -1,187,423 |
Estimated return and allowance liabilities at end of period | $235,172 | $215,471 |
WARRANTY_PROVISIONS_Details_Te
WARRANTY PROVISIONS (Details Textual) | 12 Months Ended |
Mar. 31, 2014 | |
Warranty Provisions [Line Items] | ' |
Standard Product Warranty Description | 'Customers are either allowed to return defective goods within a specified period of time after shipment (between 6 and 9 months) or granted a defective allowance consisting of a fixed percentage (between 1% and 5%) off of invoice price in lieu of returning defective products. |
SUBORDINATED_RELATED_PARTY_DEB1
SUBORDINATED RELATED PARTY DEBT (Details Textual) (USD $) | Mar. 31, 2014 |
Related Party Transaction [Line Items] | ' |
Due to Related Parties, Total | $2,500,000 |
Ram Light Management, Ltd [Member] | ' |
Related Party Transaction [Line Items] | ' |
Due to Related Parties, Total | 1,683,247 |
Starlight Marketing Development, Ltd [Member] | ' |
Related Party Transaction [Line Items] | ' |
Due to Related Parties, Total | $816,753 |
SUBSEQUENT_EVENTS_Details_Text
SUBSEQUENT EVENTS (Details Textual) (Subsequent Event [Member], USD $) | 12 Months Ended |
Mar. 31, 2014 | |
Subsequent Event [Member] | ' |
Subsequent Event [Line Items] | ' |
Description Of Logistics Service Agreement | 'SMC Logistics entered into a two year logistics service agreement with Telasia, Inc. |
Financial Services Revenue, Total | $360,000 |
SUPPLEMENTAL_DATA_SCHEDULE_II_
SUPPLEMENTAL DATA SCHEDULE II (Details) (USD $) | 12 Months Ended | ||
Mar. 31, 2014 | Mar. 31, 2013 | Mar. 31, 2012 | |
Allowance for Doubtful Accounts [Member] | ' | ' | ' |
Valuation and Qualifying Accounts Disclosure [Line Items] | ' | ' | ' |
Balance Beginning of Period | $180,306 | $168,554 | $175,804 |
Charged to Costs and Expenses | 0 | 0 | 0 |
Reduction to Allowance for Write off | -15,807 | -8,248 | -8,323 |
Credited to Costs and Expenses | 7,966 | 20,000 | 1,073 |
Balance at End of Period | 172,465 | 180,306 | 168,554 |
Valuation Allowance of Deferred Tax Assets [Member] | ' | ' | ' |
Valuation and Qualifying Accounts Disclosure [Line Items] | ' | ' | ' |
Balance Beginning of Period | 1,619,459 | 3,865,695 | 3,480,475 |
Charged to Costs and Expenses | 0 | -626,777 | 0 |
Reduction to Allowance for Write off | -820,040 | -1,619,459 | 0 |
Credited to Costs and Expenses | 0 | 0 | 385,220 |
Balance at End of Period | 799,419 | 1,619,459 | 3,865,695 |
Inventory Reserve Member [Member] | ' | ' | ' |
Valuation and Qualifying Accounts Disclosure [Line Items] | ' | ' | ' |
Balance Beginning of Period | 503,000 | 663,000 | 451,001 |
Charged to Costs and Expenses | 160,000 | 104,175 | 398,000 |
Reduction to Allowance for Write off | -25,000 | -264,175 | -186,001 |
Credited to Costs and Expenses | 0 | 0 | 0 |
Balance at End of Period | $638,000 | $503,000 | $663,000 |