Quarterly report pursuant to Section 13 or 15(d)

NOTE 4: SEGMENT INFORMATION

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NOTE 4: SEGMENT INFORMATION
3 Months Ended
Mar. 31, 2012
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, 2012 and 2011:

   
Training and
Simulation
Division
   
Battery and
Power Systems
Division
   
Corporate
Expenses
   
Discontinued
   
Total
Company
 
Three months ended March 31, 2012
                             
Revenues from outside customers                                                               
  $ 10,933,538     $ 5,174,170     $     $     $ 16,107,708  
Depreciation, amortization and impairment expenses(1)
    (279,763 )     (279,251 )     (15,364 )           (574,378 )
Direct expenses(2) 
    (10,072,542 )     (4,574,425 )     (1,775,553 )           (16,422,520 )
Segment net income (loss)
  $ 581,233     $ 320,494     $ (1,790,917 )   $     $ (889,190 )
Financial income (expense)
    (13,455 )     57,670       (81,051 )           (36,836 )
Income tax expense
    47,952             149,625             197,577  
Net income (loss) continuing operations
  $ 519,826     $ 378,164     $ (2,021,593 )   $     $ (1,123,603 )
Net income discontinued operations
                      64,160       64,160  
Net income (loss)
  $ 519,826     $ 378,164     $ (2,021,593 )   $ 64,160     $ (1,059,443 )
Segment assets(3) 
  $ 44,708,798     $ 25,275,405     $ 875,500     $ 5,154,002     $ 76,013,705  
Additions to long-lived assets
  $ 161,429     $ 141,447     $     $     $ 302,876  
Three months ended March 31, 2011
                                       
Revenues from outside customers                                                               
  $ 8,250,402     $ 4,190,069     $     $     $ 12,440,471  
Depreciation, amortization and impairment expenses(1)
    (463,610 )     (263,877 )     (17,336 )           (744,823 )
Direct expenses(2) 
    (7,099,985 )     (4,361,536 )     (1,161,640 )           (12,623,161 )
Segment net income (loss)
  $ 686,807     $ (435,344 )   $ (1,178,976 )   $     $ (927,513 )
Financial income (expense)
    (317 )     57,985       51,498             109,166  
Income tax expense
    28,122             112,502             140,624  
Net income (loss) continuing operations
  $ 658,368     $ (377,359 )   $ (1,239,980 )   $     $ (958,971 )
Net income (loss) discontinued operations
                      (1,684,174 )     (1,684,174 )
Net income (loss)
  $ 658,368     $ (377,359 )   $ (1,239,980 )   $ (1,684,174 )   $ (2,643,145 )
Segment assets(3) 
  $ 43,773,249     $ 25,271,142     $ 430,645     $ 8,985,164     $ 78,460,200  
Additions to long-lived assets
  $ 30,809     $ 61,773     $ 3,345     $ 75,423     $ 171,350  

(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 $6,156,343, respectively, as of March 31, 2012 and $24,435,640 and $6,570,184, respectively, as of March 31, 2011.