Quarterly report pursuant to Section 13 or 15(d)

NOTE 4: SEGMENT INFORMATION

v2.4.0.8
NOTE 4: SEGMENT INFORMATION
3 Months Ended
Mar. 31, 2014
Segment Reporting [Abstract]  
Segment Reporting Disclosure [Text Block]
NOTE 4:                      SEGMENT INFORMATION

a.           The Company and its subsidiaries operate primarily in two continuing business segments and follow the requirements of FASB ASC 280-10. Additionally, the two segments are also treated by the Company as reporting units for goodwill purposes under FASB ASC 350-20-35. The goodwill amounts associated with each of these reporting units was determined and valued when the specific businesses in the reportable segment were purchased.

The Company’s reportable operating segments have been determined in accordance with the Company’s internal management structure, which is organized based on operating activities. The accounting policies of the operating segments are the same as those used by the Company in the preparation of its annual financial statement. The Company evaluates performance based upon two primary factors, one is the segment’s operating income and the other is the segment’s contribution to the Company’s future strategic growth.

b.           The following is information about reported segment revenues, income (losses), and total assets for the three months ended March 31, 2014 and 2013:

   
Training and
Simulation
Division
   
Battery and
Power Systems
Division
   
Corporate
Expenses
   
Discontinued
   
Total
Company
 
Three months ended March 31, 2014
                             
Revenues from outside customers                                                               
  $ 15,681,838     $ 6,700,962     $     $     $ 22,382,800  
Depreciation, amortization and impairment expenses(1)
    (179,242 )     (192,194 )     (6,437 )           (377,873 )
Direct expenses(2) 
    (12,683,837 )     (5,835,304 )     (2,154,257 )           (20,673,398 )
Segment net income (loss)
  $ 2,818,759     $ 673,464     $ (2,160,694 )   $     $ 1,331,529  
Financial expense
    (7,412 )     (61,720 )     (49,869 )           (119,001 )
Income tax expense
    (35,011 )     (13,800 )     (149,625 )           (198,436 )
Net income (loss)
  $ 2,776,336     $ 597,944     $ (2,360,188 )   $     $ 1,014,092  
Segment assets(3) 
  $ 55,407,589     $ 25,665,035     $ 357,338     $     $ 81,429,962  
Additions to long-lived assets
  $ 295,101     $ 66,000     $ 1,607     $     $ 362,708  
Three months ended March 31, 2013
                                       
Revenues from outside customers                                                               
  $ 15,679,191     $ 6,373,940     $     $     $ 22,053,131  
Depreciation, amortization and impairment expenses(1)
    (243,994 )     (319,742 )     (7,520 )           (571,256 )
Direct expenses(2) 
    (13,426,464 )     (6,097,049 )     (1,115,661 )           (20,639,174 )
Segment net income (loss)
  $ 2,008,733     $ (42,851 )   $ (1,123,181 )   $     $ 842,701  
Financial expense
    (6,939 )     (61,440 )     (120,758 )           (189,137 )
Income tax expense
    (25,152 )           (149,625 )           (174,777 )
Net income (loss) continuing operations
  $ 1,976,642     $ (104,291 )   $ (1,393,564 )   $     $ 478,787  
Net income discontinued operations
                      (74,743 )     (74,743 )
Net income (loss)
  $ 1,976,642     $ (104,291 )   $ (1,393,564 )   $ (74,743 )   $ 404,044  
Segment assets(3) 
  $ 53,321,818     $ 27,685,266     $ 547,909     $ 122,310     $ 81,677,303  
Additions to long-lived assets
  $ 31,604     $ 873,024     $     $     $ 904,628  

(1)     Includes depreciation of property and equipment and amortization expenses of intangible assets.

(2)    Including, inter alia, sales and marketing, general and administrative.

(3)     Out of those amounts, goodwill in the Company’s Training and Simulation and Battery and Power Systems Divisions totaled $24,435,640 and $6,558,879, respectively, as of March 31, 2014 and $24,435,640 and $6,269,412, respectively, as of March 31, 2013.