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REVENUE RECOGNITION | 12 Months Ended
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Aug. 31, 2020
Revenue from Contract with Customer [Abstract] |
REVENUE RECOGNITION | NOTE 3 – REVENUE RECOGNITION The Company adopted Topic 606 effective September 1, 2018 using the modified retrospective method applying this guidance to all open contracts at the date of initial application, which resulted in an adjustment to retained earnings for the cumulative effect of applying this guidance. The most significant impact of Topic 606 on revenue to the Company relates to the timing of revenue recognition for one of its payment contracts. Under 606 the revenues under the contract are being recognized as time is expended and costs are being expensed as incurred. Under ASC 605 revenues were recognized as invoiced and certain costs were capitalized as development. We generate revenue primarily from the sale of software licenses and providing consulting services to the pharmaceutical industry for drug development. The Company determines revenue recognition through the following steps:
i. | Identification of the contract, or contracts, with a customer
ii. | Identification of the performance obligations in the contract
iii. | Determination of the transaction price
iv. | Allocation of the transaction price to the performance obligations in the contract
v. | Recognition of revenue when, or as, the Company satisfies a performance obligation
Components of revenue The following is a description of principal activities from which the Company generates revenue. As part of the accounting for these arrangements, the Company must develop assumptions that require judgment to determine the stand-alone selling price for each performance obligation identified in the contract. Stand-alone selling prices are determined based on the prices at which the Company separately sells its services or goods.
Revenue Components |  | Typical payment terms
Software Revenues: |  |
Software revenues are generated primarily from sales of software licenses at the time the software is unlocked and the term commences. The license period typically is one year or less. Along with the license a di minimis amount of customer support is provided to assist the customer with the software. Should the customer need more than a di minimis amount of support they can choose to enter into a separate contract for additional training. Most software is installed on our customers’ servers and the Company has no control of the software once the sale is made. For certain software arrangements the Company hosts the licenses on servers maintained by the Company, revenue for those arrangements are accounted as Software as a Service over the life of the contract. These arrangements are a small portion of software revenues of the Company. |  | Payments are generally due upon invoicing on a net 30 basis unless other payment terms are negotiated with the customer based on customer history. Typical industry standards apply.
Consulting Contracts: |  |
Consulting services provided to our customers are generally recognized over time as the contracts are performed and the services are rendered. The company measures its consulting revenue based on time expended compared to total estimated hours to complete a project. The Company believes the methods chosen for its contract revenue best depicts the transfer of benefits to the customer under the contracts. |  | Payment terms vary, depending on the size of the contract, credit history and history with the client and deliverables within the contract.
Consortium Member Based Services: |  |
The performance obligation is recognized on a time elapsed basis, by month, for which the services are provided, as the Company transfers control evenly over the contractual period. |  | Payment is due at the beginning of the period, generally on a net 30 or 60 basis.
Remaining performance obligations that do not fall under the expedients require the Company to perform various consulting and software development services and consortium memberships of approximately $3,303,461. It is anticipated these revenues will be recognized within the next year. Contract liabilities During the year ended August 31, 2020 the Company recognized $1,146,000 of revenue that was included in contract liabilities as of August 31, 2019. Disaggregation of Revenues
Schedule of disaggregation of revenues |  |  |  |  |  |  |  |
Disaggregation of Revenues: |  | Year Ended August 31, 2020 |  |  | Year Ended August 31, 2019 |
Software licenses |  |  |  |  |  |  |  |
Point in time |  | $ | 20,668,195 |  |  | $ | 17,425,353 |
Over time |  |  | 919,344 |  |  |  | 1,053,562 |
Consulting services |  |  |  |  |  |  |  |
Over time |  |  | 20,001,545 |  |  |  | 15,491,525 |
Total Revenue |  | $ | 41,589,084 |  |  | $ | 33,970,440 |
Contracts in Progress Contracts in progress are included in the accompanying balance sheets under the following captions:
Schedule of contract in progress |  |  |  |  |  |  |  |
|  | 2020 |  |  | 2019 |
Revenues in excess of billings |  | $ | 3,093,343 |  |  | $ | 3,233,659 |
Billings in excess of revenues |  |  | (140,991 | ) |  |  | (798,549 | )
Revenues over billings on uncompleted contracts |  | $ | 2,952,352 |  |  | $ | 2,435,110 |
Cost, estimated earnings, and billings on uncompleted contracts are summarized as follows as of August 31, 2020 and 2019:
|  | 2020 |  |  | 2019 |
Revenues earned to date on uncompleted contracts |  | $ | 20,235,573 |  |  | $ | 19,254,928 |
Billings to date on uncompleted contracts |  |  | (17,283,221 | ) |  |  | (16,819,818 | )
Revenues over billings on uncompleted contracts |  | $ | 2,952,352 |  |  | $ | 2,435,110 |
Balance increases and decreases in these accounts are due to the timing of amounts billed, payments received, and revenue recognized.

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- Definition The entire disclosure of revenue from contract with customer to transfer good or service and to transfer nonfinancial asset. Includes, but is not limited to, disaggregation of revenue, credit loss recognized from contract with customer, judgment and change in judgment related to contract with customer, and asset recognized from cost incurred to obtain or fulfill contract with customer. Excludes insurance and lease contracts. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 606 -URI http://asc.fasb.org/topic&trid=49130388 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 606 -SubTopic 10 -Section 50 -Paragraph 10 -URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130551-203045 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 606 -SubTopic 10 -Section 50 -Paragraph 13 -Subparagraph (b)(2) -URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130556-203045 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 606 -SubTopic 10 -Section 50 -Paragraph 12 -Subparagraph (b) -URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130554-203045 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 606 -SubTopic 10 -Section 50 -Paragraph 9 -URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130550-203045 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 606 -SubTopic 10 -Section 50 -Paragraph 12 -Subparagraph (e) -URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130554-203045 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 606 -SubTopic 10 -Section 50 -Paragraph 12 -Subparagraph (a) -URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130554-203045 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 606 -SubTopic 10 -Section 50 -Paragraph 12 -Subparagraph (d) -URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130554-203045 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 606 -SubTopic 10 -Section 50 -Paragraph 15 -URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130558-203045 Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 606 -SubTopic 10 -Section 50 -Paragraph 12 -Subparagraph (c) -URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130554-203045 + Details
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