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Note 4 - Accounts Receivable, Transit Accounts Receivable and Transit Accounts Payable | 9 Months Ended
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Sep. 28, 2019
Notes to Financial Statements |
Loans, Notes, Trade and Other Receivables Disclosure [Text Block] |
4. | Accounts Receivable, Transit Accounts Receivable and Transit Accounts Payable
The Company’s accounts receivable are comprised as follows:
|  | September 28, 2019 |  |  | December 29, 2018 |
Billed |  | $ | 25,889 |  |  | $ | 32,323 |
Accrued and unbilled |  |  | 17,191 |  |  |  | 10,383 |
Work-in-progress |  |  | 3,758 |  |  |  | 2,252 |
Accounts receivable subject to arbitration |  |  | 12,177 |  |  |  | 8,820 |
Allowance for sales discounts and doubtful accounts |  |  | (1,545 | ) |  |  | (1,443 | )
Accounts receivable, net |  | $ | 57,470 |  |  | $ | 52,335 |
Unbilled receivables primarily represent revenue earned whereby those services are ready to be billed as of the balance sheet ending date. Work-in-progress primarily represents revenue earned under contracts which the Company contractually invoices at future dates. From time to time, the Company’s Engineering segment enters into agreements to provide, among other things, construction management and engineering services. Pursuant to these agreements, the Company a) may engage subcontractors to provide construction or other services; b) typically earns a fixed percentage of the total project value; and c) assumes no ownership or risks of inventory. Under the terms of the agreements, the Company is typically not required to pay the subcontractor until after the corresponding payment from the Company’s end-client is received. Upon invoicing the end-client on behalf of the subcontractor or staffing agency the Company records this amount simultaneously as both a “transit account receivable” and “transit account payable” as the amount when paid to the Company is due to and generally paid to the subcontractor within a few days. The Company typically does not pay a given transit account payable until the related transit account receivable is collected. The Company is typically obligated to pay the subcontractor or staffing agency whether or not the client pays the Company. The Company’s transit accounts payable generally exceeds the Company’s transit accounts receivable but absolute amounts and spreads fluctuate significantly from quarter to quarter in the normal course of business. The transit accounts receivable was $3.7 million and related transit accounts payable was $4.5 million, for a net payable of $0.8 million, as of September 28, 2019. The transit accounts receivable was $2.6 million and related transit accounts payable was $2.5 million, for a net receivable of $0.1 million, as of December 29, 2018. The Company has a dispute with a customer that is a major utility in the United States. Both parties agreed in fiscal 2017 to resolve this dispute through binding arbitration. Arbitration hearings with this customer started in fiscal 2018. Essentially, the customer has not paid the balance of accounts receivable the Company believes are owed for certain disputed projects. As of September 28, 2019 and December 29, 2018, the total amount of outstanding receivables from this customer on these disputed projects was $12.2 million and $8.9 million, respectively, subject to potential upward adjustment in damages claimed in arbitration. Additionally, as part of the arbitration process, the customer has asserted counter-claims. While the total amount of asserted counter-claims is unknown as of September 28, 2019, the total amount of such counter-claims is anticipated to be at least $10.3 million. The Company believes these counter-claims are retaliatory in nature. Prior to the Company asserting its claims, the customer had not asserted any counter-claims. The Company believes these counter-claims asserted by its customer have no merit and were merely asserted as a strategy to reduce the Company’s own claims in any arbitration award or potential settlement agreement. The Company believes that its accounts receivable balance, subject to reserves, is fully collectible. Furthermore, the Company believes that this arbitration will conclude prior to reporting its fiscal 2019 financial results. While the Company believes the customer’s counter-claims to be frivolous and without merit, it can give no assurances that it will ultimately not have to pay all or a portion of such counter-claims. The Company is continuing work on one of the engagements that have given rise to this dispute and also on several engagements from the same client that are not currently part of the arbitration.

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- Definition The entire disclosure for claims held for amounts due a entity, excluding financing receivables. Examples include, but are not limited to, trade accounts receivables, notes receivables, loans receivables. Includes disclosure for allowance for credit losses. + References Reference 1: http://www.xbrl.org/2009/role/commonPracticeRef -Publisher FASB -Name Accounting Standards Codification -Topic 310 -SubTopic 10 -URI http://asc.fasb.org/subtopic&trid=2196772 + Details
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