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FAIR VALUE MEASUREMENTS | 9 Months Ended
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Jun. 30, 2021
Fair Value Disclosures [Abstract] |
FAIR VALUE MEASUREMENTS | NOTE 4 FAIR VALUE MEASUREMENTS The earnout consideration of $70,000 and $90,000 at June 30, 2021 and September 30, 2020, respectively, represents the fair value of the contingent earnout consideration related to the acquisition of Kablooe. The current and non-current portions of this liability are shown in the corresponding categories on the condensed consolidated balance sheets in each period presented. In December 2020, the Company reduced this liability from $90,000 to $60,000 based on the low likelihood of Kablooe reaching the first year’s earnings target and in June 2021, it increased this liability from $60,000 to $70,000 based on the estimated increase in fair value of earnout payments in future periods. In connection with the acquisition of IPS in January 2018, the Company agreed to pay deferred cash consideration and contingent earnout consideration to the selling shareholders of IPS and these liabilities were measured at fair value each reporting period. In March 2020, the fair value of the earnout consideration was reduced from $350,000 to $0 due to the low likelihood of IPS reaching the underlying earnings target. At September 30, 2020, the Company had no remaining obligation for consideration payments related to the acquisition of IPS. The following table presents the placement in the fair value hierarchy and summarizes the changes in fair value of the earnout liability for the three and nine months ended June 30, 2021:
Table of fair value liability measured on recurring basis |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | Fair value measurement at reporting date using |
|  |  |  |  |  |  | Quoted prices in active markets for identical assets |  |  |  | Significant other observable inputs |  |  |  | Significant unobservable inputs |
|  |  | Balance |  |  |  | (Level 1) |  |  |  | (Level 2) |  |  |  | (Level 3) |
Earnout consideration at September 30, 2020 |  | $ | 90,000 |  |  | $ | – |  |  | $ | – |  |  | $ | 90,000 |
Decrease in fair value of Kablooe earnout consideration |  |  | (30,000 | ) |  |  | – |  |  |  | – |  |  |  | (30,000 | )
Earnout consideration at December 31, 2020 |  |  | 60,000 |  |  |  | – |  |  |  | – |  |  |  | 60,000 |
Change in fair value of Kablooe earnout consideration |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |
Earnout consideration at March 31, 2021 |  |  | 60,000 |  |  |  | – |  |  |  | – |  |  |  | 60,000 |
Increase in fair value of Kablooe earnout consideration |  |  | 10,000 |  |  |  | – |  |  |  | – |  |  |  | 10,000 |
Earnout consideration at June 30, 2021 |  | $ | 70,000 |  |  | $ | – |  |  | $ | – |  |  | $ | 70,000 |
During Fiscal 2019, the Company received common stock from a customer as compensation for services provided, which was recorded as a cost-method investment with an estimated fair value of $327,000. This initial fair value was based on a private placement round of common stock issued to third-party private investors of the customer at a time close to the valuation date. Management determined that the inputs used to value the investment were observable, either directly or indirectly, and therefore classified as a level 2 valuation measurement. In March 2020, due to the performance of the business in which the Company was invested, it concluded the investment was impaired and recorded an impairment charge of $327,000, which was recorded as a component of general and administrative expenses on the condensed consolidated statement of operations.

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- Definition The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 820 -SubTopic 10 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=123874694&loc=d3e19207-110258 + Details
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