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Note 2 - Revision of Previously Issued Consolidated Financial Statements | 12 Months Ended
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Dec. 31, 2022
Notes to Financial Statements |
Error Correction [Text Block] |
2. | Correction of immaterial errors
During the fourth quarter of 2022, we determined that an error existed in our previously issued consolidated financial statements. Specifically, we identified we had established nexus in several jurisdictions beginning in the year ended December 31, 2019 in which we were not collecting and remitting sales taxes appropriately. The error was evaluated under the U.S. Securities and Exchange Commission's ("SEC's") guidance on evaluating the materiality of prior period misstatements to the Company’s financial statements. We evaluated the error and concluded that it was not material to the previously issued consolidated financial statements. Although the error was not material to any period, we corrected the accompanying historical consolidated financial statements for the years ended December 31, 2021 and 2020 to reflect the sales tax liability and associated expenses owed within each period for comparative purposes. The following tables represent the adjustments to our Consolidated Statements of Operations and Consolidated Statements of Cash Flows for the years ended December 31, 2021 and 2020, as well as adjustments to our Consolidated Balance Sheet as of December 31, 2021 in accordance with ASC 250. The adjustments to our Consolidated Statements of Comprehensive (Loss) Income and Consolidated Statements of Shareholders’ Equity were limited to the net income (loss) adjustments outlined below. The effect of the adjustments to our Consolidated Balance Sheet as of December 31, 2021 was as follows (in thousands):
|  | December 31, 2021 |
|  | As reported |  |  | Adjustment |  |  | As corrected |
Prepaid expenses and other current assets |  | $ | 4,427 |  |  | $ | 229 |  |  | $ | 4,656 |
Total current assets |  |  | 125,859 |  |  |  | 229 |  |  |  | 126,088 |
Total assets |  |  | 554,057 |  |  |  | 229 |  |  |  | 554,286 |
Accrued expenses and other current liabilities(1) |  |  | 7,142 |  |  |  | (272 | ) |  |  | 6,870 |
Sales taxes payable |  |  | - |  |  |  | 2,591 |  |  |  | 2,591 |
Total current liabilities |  |  | 40,381 |  |  |  | 2,319 |  |  |  | 42,700 |
Total liabilities |  |  | 73,920 |  |  |  | 2,319 |  |  |  | 76,239 |
Accumulated deficit(2) |  |  | (105,020 | ) |  |  | (2,090 | ) |  |  | (107,110 | )
Total shareholders’ equity |  |  | 480,137 |  |  |  | (2,090 | ) |  |  | 478,047 |
Total liabilities and shareholders’ equity |  |  | 554,057 |  |  |  | 229 |  |  |  | 554,286 |
(1) | In the prior year Consolidated Balance Sheet as of the year ended December 31, 2021, accrued sales taxes in the amount of $272,000 were recorded within the Accrued expenses and other current liabilities line item on the consolidated balance sheets. These were reclassified to Sales tax payable in the current year.
(2) | The impact of the error on Accumulated deficit in our Consolidated Balance Sheet as of the year ended December 31, 2019 was negative $133,000, adjusting the ending balance to be $100.2 million when previously reported as $100.1 million.
The effect of the adjustments to our Consolidated Statements of Operations for the years ended December 31, 2021 and 2020 were as follows (in thousands, except per share data):
|  | Years Ended December 31, 2021 and 2020 |
2021 |  | As reported |  |  | Adjustment |  |  | As corrected |
General and administrative |  | $ | 32,448 |  |  | $ | 1,220 |  |  | $ | 33,668 |
Total operating expenses |  |  | 153,096 |  |  |  | 1,220 |  |  |  | 154,316 |
Operating loss |  |  | (33,940 | ) |  |  | (1,220 | ) |  |  | (35,160 | )
Interest expense |  |  | (432 | ) |  |  | (53 | ) |  |  | (485 | )
Total other income, net |  |  | 6,187 |  |  |  | (53 | ) |  |  | 6,134 |
Loss before income tax benefit |  |  | (27,753 | ) |  |  | (1,273 | ) |  |  | (29,026 | )
Net loss(1) |  |  | (7,635 | ) |  |  | (1,273 | ) |  |  | (8,908 | )
Net loss per basic share |  |  | (0.20 | ) |  |  | (0.03 | ) |  |  | (0.23 | )
Net loss per diluted share |  |  | (0.20 | ) |  |  | (0.03 | ) |  |  | (0.23 | )
2020 |  |  |  |  |  |  |  |  |  |  |  |
General and administrative |  |  | 14,607 |  |  |  | 666 |  |  |  | 15,273 |
Total operating expenses |  |  | 53,662 |  |  |  | 666 |  |  |  | 54,328 |
Operating loss |  |  | (5,575 | ) |  |  | (666 | ) |  |  | (6,241 | )
Interest income |  |  | 58 |  |  |  | (18 | ) |  |  | 40 |
Total other income, net |  |  | 4,978 |  |  |  | (18 | ) |  |  | 4,960 |
Loss before income tax benefit |  |  | (597 | ) |  |  | (684 | ) |  |  | (1,281 | )
Net income(1) |  |  | 2,667 |  |  |  | (684 | ) |  |  | 1,983 |
Net income attributable to common shareholders - Basic |  |  | 2,450 |  |  |  | (628 | ) |  |  | 1,822 |
Net loss attributable to common shareholders - Diluted |  |  | (954 | ) |  |  | (678 | ) |  |  | (1,632 | )
Net income per basic share |  |  | 0.09 |  |  |  | (0.02 | ) |  |  | 0.07 |
Net loss per diluted share |  |  | (0.03 | ) |  |  | (0.03 | ) |  |  | (0.06 | )
(1) | The Consolidated Statements of Comprehensive (Loss) Income for the years ended December 31, 2021 and 2020 were adjusted by the impact to net (loss) income noted here. Comprehensive loss for the year ended December 31, 2021 is now reported at $9.2 million, reflecting an adjustment of $1.3 million, and was previously reported as $7.9 million. Comprehensive income for the year ended December 31, 2020 is now reported at $1.9 million, reflecting an adjustment of negative $684,000, and was previously reported as $2.7 million.
The effect of the adjustments to our Consolidated Statements of Cash Flows for the years ended December 31, 2021 and 2020 were as follows (in thousands):
|  | Years Ended December 31, 2021 and 2020 |
2021 |  | As reported |  |  | Adjustment |  |  | As corrected |
Net loss |  | $ | (7,635 | ) |  | $ | (1,273 | ) |  | $ | (8,908 | )
Prepaid expenses and other current assets |  |  | 2,802 |  |  |  | (139 | ) |  |  | 2,663 |
Sales taxes payable |  |  | - |  |  |  | 1,412 |  |  |  | 1,412 |
2020 |  |  |  |  |  |  |  |  |  |  |  |
Net income |  |  | 2,667 |  |  |  | (684 | ) |  |  | 1,983 |
Prepaid expenses and other current assets |  |  | 25 |  |  |  | (75 | ) |  |  | (50 | )
Sales taxes payable |  |  | - |  |  |  | 759 |  |  |  | 759 |
All accompanying footnotes reflect corrected balances presented in the tables above.

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- Definition The entire disclosure for reporting error correction. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 250 -SubTopic 10 -Section 50 -Paragraph 7 -URI https://asc.fasb.org/extlink&oid=124431687&loc=d3e22644-107794 + Details
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