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SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended
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Dec. 31, 2021
Accounting Policies [Abstract] |
SIGNIFICANT ACCOUNTING POLICIES |
2. | SIGNIFICANT ACCOUNTING POLICIES
Restatement of Previously Issued Financial Statements On May 16, 2022, management in concurrence with the Company’s Audit Committee of our Board of Directors (the “Audit Committee”), concluded that that the financial statements previously issued as of and for the years ended December 31, 2021 and 2020, and included in the Company’s annual report on Form 10-K for the year ended December 31, 2021, should no longer be relied upon due to errors in accounting for certain option awards. Accordingly, we are restating our Balance Sheets, Statements of Operations, Statements of Stockholders’ Equity, Statements of Cash Flows and the related notes as of and for the years ended December 31, 2021 and 2020. Specifically, the Company determined that a cashless withholding to satisfy personal income tax obligations from certain option awards exercised commencing in the third quarter of 2020 and the first quarter of 2021, caused the underlying options to no longer qualify as equity awards and should have instead been classified as liability awards commencing on the date of exercise. The change in the classification of the awards to liability classified awards requires the Company to remeasure the fair value of the awards at the end of each reporting period they remain outstanding, with the increase or decrease in fair value correspondingly charged or credited to selling, general and administrative expenses in arriving at net income. Furthermore, the Company, due to an administrative error, failed to sell the shares surrendered in 2021 and did not remit the equivalent amount of funds to the tax authorities. To date, the Company has not returned the shares or otherwise reimbursed the effected individuals for the shares withheld. The Company is currently in the process of arranging payment to individuals, which is expected to be completed during the quarter ending June 30, 2022. INTELLICHECK, INC. NOTES TO FINANCIAL STATEMENTS (All dollar amounts are rounded to thousands, except share data) These errors resulted in misstatements to our Balance Sheets, Statements of Operations, Statements of Stockholders’ Equity, and Statements of Cash Flows as of and for the years ended December 31, 2021 and 2020, as follows: SCHEDULE OF ERRORS RESULTED IN MISSTATEMENTS
|  | As of December 31, 2021 |
|  | As Previously |  |  | Restatement |  |  | As |
|  | Reported |  |  | Adjustment |  |  | Restated |
BALANCE SHEET |  |  |  |  |  |  |  |  |  |  |  |
Equity awards liability |  | $ | - |  |  |  | 378 |  |  | $ | 378 |
Liability for shares withheld |  | $ | - |  |  |  | 1,244 |  |  | $ | 1,244 |
Total current liabilities |  | $ | 4,504 |  |  |  | 1,622 |  |  | $ | 6,126 |
Total liabilities |  | $ | 4,512 |  |  |  | 1,622 |  |  | $ | 6,134 |
Additional paid-in capital |  | $ | 141,703 |  |  |  | 4,752 |  |  | $ | 146,455 |
Accumulated deficit |  | $ | (120,523 | ) |  |  | (6,374 | ) |  | $ | (126,897 | )
Total stockholders’ equity |  | $ | 21,199 |  |  |  | (1,622 | ) |  | $ | 19,577 |
Common stock (shares) |  |  | 18,753,003 |  |  |  | (92,634 | ) |  |  | 18,660,369 |
|  | As of December 31, 2020 |
|  | As Previously Reported |  |  | Restatement Adjustment |  |  | As Restated |
BALANCE SHEET |  |  |  |  |  |  |  |  |  |  |  |
Additional paid-in capital |  | $ | 138,570 |  |  |  | 3,042 |  |  | $ | 141,612 |
Accumulated deficit |  | $ | (116,377 | ) |  |  | (3,042 | ) |  | $ | (119,419 | )
Total stockholders’ equity |  | $ | 22,211 |  |  |  | - |  |  | $ | 22,211 |
|  | For the Year Ended December 31, 2021 |
|  | As Previously Reported |  |  | Restatement Adjustment |  |  | As Restated |
STATEMENT OF OPERATIONS |  |  |  |  |  |  |  |  |  |  |  |
Selling, general and administrative expenses |  | $ | 11,564 |  |  |  | 3,331 |  |  | $ | 14,895 |
Total operating expenses |  | $ | 17,044 |  |  |  | 3,331 |  |  | $ | 20,375 |
Loss from operations |  | $ | (4,162 | ) |  |  | (3,331 | ) |  | $ | (7,493 | )
Interest and other income |  | $ | 6 |  |  |  | (1 | ) |  | $ | 5 |
Total other income |  | $ | 16 |  |  |  | (1 | ) |  | $ | 15 |
Net loss |  | $ | (4,146 | ) |  |  | (3,332 | ) |  | $ | (7,478 | )
PER SHARE INFORMATION |  |  |  |  |  |  |  |  |  |  |  |
Loss per common share |  |  |  |  |  |  |  |  |  |  |  |
Basic and Diluted |  | $ | (0.22 | ) |  |  | (0.18 | ) |  | $ | (0.40 | )
Weighted average common shares used in computing per share amounts (Basic and Diluted) |  |  | 18,676,965 |  |  |  | (78,555 | ) |  |  | 18,598,410 |
INTELLICHECK, INC. NOTES TO FINANCIAL STATEMENTS (All dollar amounts are rounded to thousands, except share data)
|  | For the year ended December 31, 2020 |
|  | As Previously Reported |  |  | Restatement Adjustment |  |  | As Restated |
STATEMENT OF OPERATIONS |  |  |  |  |  |  |  |  |  |  |  |
Selling, general and administrative expenses |  | $ | 5,894 |  |  |  | 3,042 |  |  | $ | 8,936 |
Total operating expenses |  | $ | 9,569 |  |  |  | 3,042 |  |  | $ | 12,611 |
Loss from operations |  | $ | (260 | ) |  |  | (3,042 | ) |  | $ | (3,302 | )
Net income (loss) |  | $ | 558 |  |  |  | (3,042 | ) |  | $ | (2,484 | )
PER SHARE INFORMATION |  |  |  |  |  |  |  |  |  |  |  |
Loss per common share |  |  |  |  |  |  |  |  |  |  |  |
Basic and Diluted |  | $ | 0.03 |  |  |  | (0.17 | ) |  | $ | (0.14 | )
Weighted average common shares used in computing per share amounts |  |  |  |  |  |  |  |  |  |  |  |
Basic |  |  | 17,324,150 |  |  |  | - |  |  |  | 17,324,150 |
Diluted |  |  | 18,020,866 |  |  |  | (696,716 | ) |  |  | 17,324,150 |
|  | For the year ended December 31, 2021 |
|  | As Previously |  |  | Restatement |  |  | As |
|  | Reported |  |  | Adjustment |  |  | Restated |
STATEMENT OF STOCKHOLDERS’ EQUITY |  |  |  |  |  |  |  |  |  |  |  |
Exercise of stock options, net of cashless exercise of 58,926 shares and 92,634 shares withheld |  | $ | 47 |  |  |  | 1,710 |  |  | $ | 1,757 |
Net loss |  | $ | (4,146 | ) |  |  | (3,332 | ) |  | $ | (7,478 | )
Accumulated deficit |  | $ | (120,523 | ) |  |  | (6,374 | ) |  | $ | (126,897 | )
Additional paid-in capital |  | $ | 141,703 |  |  |  | 4,752 |  |  | $ | 146,455 |
Total Stockholders’ Equity |  | $ | 21,199 |  |  |  | (1,622 | ) |  | $ | 19,577 |
Common stock (shares) |  |  | 18,753,003 |  |  |  | (92,634 | ) |  | $ | 18,660,369 |
INTELLICHECK, INC. NOTES TO FINANCIAL STATEMENTS (All dollar amounts are rounded to thousands, except share data)
|  | For the year ended December 31, 2020 |
|  | As Previously |  |  | Restatement |  |  | As |
|  | Reported |  |  | Adjustment |  |  | Restated |
STATEMENT OF STOCKHOLDERS’ EQUITY |  |  |  |  |  |  |  |  |  |  |  |
Exercise of liability awards |  | $ | - |  |  |  | 3,042 |  |  | $ | 3,042 |
Net income (loss) |  | $ | 558 |  |  |  | (3,042 | ) |  | $ | (2,484 | )
Accumulated deficit |  | $ | (116,377 | ) |  |  | (3,042 | ) |  | $ | (119,419 | )
Additional paid-in capital |  | $ | 138,570 |  |  |  | 3,042 |  |  | $ | 141,612 |
Ending balance, value |  | $ | 138,570 |  |  |  | 3,042 |  |  | $ | 141,612 |
|  | For the year ended December 31, 2021 |
|  | As Previously |  |  | Restatement |  |  | As |
|  | Reported |  |  | Adjustment |  |  | Restated |
STATEMENT OF CASH FLOWS |  |  |  |  |  |  |  |  |  |  |  |
Net loss |  | $ | (4,146 | ) |  |  | (3,332 | ) |  | $ | (7,478 | )
Equity compensation |  | $ | 3,068 |  |  |  | 3,332 |  |  | $ | 6,400 |
Supplemental disclosure of noncash investing and financing activities: |  |  |  |  |  |  |  |  |  |  |  |
Reclassification of stock option awards |  | $ | - |  |  |  | 1,411 |  |  | $ | 1,411 |
|  | For the year ended December 31, 2020 |
|  | As Previously |  |  | Restatement |  |  | As |
|  | Reported |  |  | Adjustment |  |  | Restated |
STATEMENT OF CASH FLOWS |  |  |  |  |  |  |  |  |  |  |  |
Net income (loss) |  | $ | 558 |  |  |  | (3,042 | ) |  | $ | (2,484 | )
Equity compensation |  | $ | 409 |  |  |  | 3,042 |  |  | $ | 3,451 |
The correction of the errors had no effect on net cash provided by (used in) operating activities for either period. Use of Estimates The preparation of the Company’s financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the amounts reported in the Company’s financial statements and accompanying notes. Significant estimates and assumptions that affect amounts reported in the financial statements include impairment consideration and valuation of goodwill and intangible assets, deferred tax valuation allowances, allowance for doubtful accounts, revenue recognition (including breakage revenue) and the fair value of stock options granted under the Company’s Equity compensation plan. Due to the inherent uncertainties involved in making estimates, actual results reported in future periods may be different from those estimates. As discussed above, certain option awards no longer qualify as equity awards and instead are being classified as liability awards. ASC 718 establishes fair value as the measurement objective in accounting for equity payment arrangements and requires all companies to apply a fair-value based measurement method in accounting for all equity payment transactions with employees. The Company determined the fair value of these awards utilizing a Black-Scholes option pricing model. INTELLICHECK, INC. NOTES TO FINANCIAL STATEMENTS (All dollar amounts are rounded to thousands, except share data) Financial Accounting Standards Board (“FASB”) guidance specifies a hierarchy of valuation techniques based on whether the inputs to those valuation techniques are observable or unobservable. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect market assumptions. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurement) and the lowest priority to unobservable inputs (Level 3 measurement). The three levels of the fair value hierarchy are as follows:
| ● | Level 1—Unadjusted quoted prices in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date. Level 1 primarily consists of financial instruments whose value is based on quoted market prices such as exchange-traded instruments and listed equities.
| ● | Level 2—Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly (e.g., quoted prices of similar assets or liabilities in active markets, or quoted prices for identical or similar assets or liabilities in markets that are not active). Level 2 includes financial instruments that are valued using models or other valuation methodologies. The Company had $378 worth of Level 2 liabilities as of December 31, 2021 for liability classified stock options.
| ● | Level 3—Unobservable inputs for the asset or liability. Financial instruments are considered Level 3 when the fair values are determined using pricing models, discounted cash flows or similar techniques and at least one significant model assumption or input is unobservable. The Company had no Level 3 assets or liabilities as of December 31, 2021 and 2020.
Allowance for Doubtful Accounts The Company records its allowance for doubtful accounts based upon its assessment of various factors. The Company considers historical experience, the age of the accounts receivable balances, credit quality of the Company’s customers, current economic conditions and other factors that may affect customers’ ability to pay. Long-Lived Assets and Impairment of Long-Lived Assets The Company’s long-lived assets include property and equipment, goodwill, and intangible assets. INTELLICHECK, INC. NOTES TO FINANCIAL STATEMENTS (All dollar amounts are rounded to thousands, except share data) The Company reviews its long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of these assets may not be fully recoverable in accordance with Accounting Standards Codification (“ASC”) 350 (“Intangibles – Goodwill and Other”) and ASC 360 (“Property, Plant and Equipment”) to determine recoverability of its long-lived assets, the Company evaluates the probability that future undiscounted net cash flows, without interest charges, will be less than the carrying amount of the assets. Impairment is measured at fair value. Property and Equipment Property and equipment are recorded at cost and are depreciated over their estimated useful lives ranging from three to ten-years using the straight-line method. Leasehold improvements are amortized utilizing the straight-line method over the lesser of the term of the lease or estimated useful life of the asset. See Note 3. Goodwill Goodwill represents the excess of purchase price over the fair value of net assets acquired in business combinations. Pursuant to ASC 350, the Company tests goodwill for impairment on an annual basis in the fourth quarter, or between annual tests, in certain circumstances. Under authoritative guidance, the Company first assessed qualitative factors to determine whether it was necessary to perform step one of the quantitative goodwill impairment test. An entity is not required to calculate the fair value of a reporting unit unless the entity determines, based on a qualitative assessment, that it is more likely than not that its fair value is less than its carrying amount. Events or changes in circumstances which could trigger an impairment review include macroeconomic conditions, industry and market conditions, cost factors, overall financial performance, other entity specific events and sustained decrease in share price. The Company performed its annual impairment test of goodwill in the fourth quarter for the years ended December 31, 2021 and 2020. For the years ended December 31, 2021 and 2020, the Company determined no impairment charge was required. See Note 4. Intangible Assets Intangible assets include patents, copyrights, and developed technology. The Company amortizes these assets on a straight-line basis over their estimated useful lives, as it represents the pattern of economic benefits consumed. The Company reviews its long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of these assets may not be fully recoverable in accordance with ASC 360. To determine recoverability of its long-lived assets, the Company evaluates the probability that future undiscounted net cash flows, without interest charges, will be less than the carrying amount of the assets. There were no impairment charges recognized for the years ended December 31, 2021 and 2020. See Note 4. Revenue Recognition and Deferred Revenue General Most license fees and services revenue are generated from a combination of fixed-price and per-scan contracts. Under the per-scan revenue model, customers are charged a fee each time the customer scans an identity document, such as a driver’s license, with the Company’s software. Under the fixed-price revenue model customers are charged a fixed monthly fee either per device or physical business location to access the Company’s software. Under ASC 606, revenue is recognized when a customer obtains control of promised goods or services in an amount that reflects the consideration expected to be received in exchange for those goods or services. The Company measures revenue based on the consideration specified in a customer arrangement, and revenue is recognized when the performance obligations in an arrangement are satisfied. A performance obligation is a promise in a contract to transfer a distinct service to the customer. The transaction price of a contract is allocated to each distinct performance obligation and recognized as revenue when or as, the customer receives the benefit of the performance obligation. Customers typically receive the benefit of the Company’s services as they are performed. Substantially all customer contracts provide that the Company is compensated for services performed to date. INTELLICHECK, INC. NOTES TO FINANCIAL STATEMENTS (All dollar amounts are rounded to thousands, except share data) During 2021, the Company adopted an additional revenue model where customers purchase a predetermined number of transactions for the term of the contract. Revenue for these transactions are recognized on a per transaction basis. The Company estimates the amount of unused transactions at the end of each contract period and recognizes a portion of that revenue as breakage revenue each reporting period. If the Company expects the customer to use all transactions in the specified service period, the Company will recognize the transaction price as revenue in the specified service period as the promised units of service are transferred to the customer. Alternatively, if the Company expects that the customer cannot or will not use all transactions in the specified service period (referred to as “breakage”), the Company will recognize the estimated breakage amount as revenue ratably over the service period in proportion to the revenue that the Company will recognize for actual transactions used by the customer in the service period. Invoicing is based on schedules established in customer contracts. Payment terms are generally established from 30 to 60 days from the invoice date. Product returns are recorded as a reduction to revenue. Nature of goods and services The following is a description of the products and services from which the Company generates revenue, as well as the nature, timing of satisfaction of performance obligations, and significant payment terms for each: Software as a Service (SaaS) Software as a service (SaaS) for hosted subscription services and licensed software allows customers to access a set of data for a predetermined period of time. As the customer obtains access at a point in time but continues to have access for the remainder of the subscription period, the customer is considered to simultaneously receive and consume the benefits provided by the entity’s performance as the entity performs. Accordingly, the revenue should be recognized over time, under the fixed pricing model, based on the usage of the hosted subscription services and licensed software, which can vary from month to month. Under the per-scan revenue model, revenue is recognized each time the customer scans an identity document. Other Subscription and Support Services The Company also recognizes revenues from other subscription and support services, which includes jurisdictional updates to certain commercial customers and support services particularly to its Defense ID® customers. These subscriptions require continuing service or post contractual customer support and performance. As the customer obtains access at a point in time but continues to have access for the remainder of the subscription period, the customer is considered to simultaneously receive and consume the benefits provided by the entity’s performance as the entity performs. Accordingly, the revenue should be recognized over time based on usage, which can vary from month to month. The revenue is typically based on a formula such as number of locations in a given month multiplied by a fee per location. Equipment Revenue Revenue from the sale of equipment is recognized at a point in time. The point in time that the revenue is recognized is when the customer has control of the equipment which is when the customer receives the benefit and the Company’s performance obligation has been satisfied. Depending on the contract terms, that could either be at the time the equipment is shipped or at the time the equipment is received. Non-Recurring Services Revenue The non-recurring services include items such as training, installation, customization, and configuration. The Company recognizes revenue from non-recurring services contracts ratably over the service contract period as the customer consumes the benefit as it is provided and the Company’s performance obligation has been satisfied. INTELLICHECK, INC. NOTES TO FINANCIAL STATEMENTS (All dollar amounts are rounded to thousands, except share data) Extended Warranty Extended warranty revenues are generated when a warranty is provided to the customer separately of other performance obligations when the equipment is sold. As the customer obtains access at a point in time and continues to have access for the remainder of the warranty term, the customer is considered to simultaneously receive and consume the benefits provided by the Company’s performance as the Company performs. The related revenue is recognized ratably over the specified term of the warranty period. The extended warranty is separate to the Company’s standard warranty of usually one year that it receives from its vendor. Disaggregation of revenue In the following tables, revenue is disaggregated by product and service and the timing of revenue recognition. The table also includes a reconciliation of the disaggregated revenue. SCHEDULE OF DISAGGREGATION OF REVENUE
|  |  | 2021 |  |  |  | 2020 |
|  | For the Years Ended December 31, |
|  | 2021 |  |  | 2020 |
Products and services |  |  |  |  |  |  |  |
Software as a Service (SaaS) |  | $ | 12,970 |  |  | $ | 9,373 |
Other subscription and support services |  |  | 35 |  |  |  | 199 |
Equipment |  |  | 3,056 |  |  |  | 1,045 |
Non-recurring services |  |  | 114 |  |  |  | 78 |
Extended warranties on equipment |  |  | 8 |  |  |  | 21 |
Other |  |  | 210 |  |  |  | 19 |
Revenues |  | $ | 16,393 |  |  | $ | 10,735 |
Timing of revenue recognition |  |  |  |  |  |  |  |
Products transferred at a point in time |  | $ | 3,266 |  |  | $ | 1,064 |
Services transferred over time |  |  | 13,127 |  |  |  | 9,671 |
Revenues |  | $ | 16,393 |  |  | $ | 10,735 |
Contract balances The current portion of deferred revenue at December 31, 2021 and December 31, 2020 was $1,266 and $403, respectively, and primarily consists of revenue that is recognized over time for software license contracts and hosted subscription services. The changes in these balances are related to the satisfaction or partial satisfaction of these contracts. The entire December 31, 2020, current deferred revenue balance was recognized as revenue in the year ended December 31, 2021. The noncurrent deferred revenue balances were $8 and $9 as of December 31, 2021, and December 31, 2020, respectively. The Company did not recognize any material revenue in the current reporting period for performance obligations that were fully satisfied in previous periods. Transaction price allocated to the remaining performance obligations The following table includes estimated revenue expected to be recognized in the future related to performance obligations that are unsatisfied (or partially unsatisfied) at the end of the reporting period: SCHEDULE OF REVENUE PERFORMANCE OBLIGATION
|  | 2022 |  |  | 2023 |  |  | 2024 |  |  | Total |
Software as a Service (SaaS) |  | $ | 1,256 |  |  | $ | 3 |  |  | $ | - |  |  | $ | 1,259 |
Other subscription and support services |  |  | 8 |  |  |  | 3 |  |  |  | 1 |  |  |  | 12 |
Extended warranties on equipment |  |  | 2 |  |  |  | 1 |  |  |  | - |  |  |  | 3 |
|  | $ | 1,266 |  |  | $ | 7 |  |  | $ | 1 |  |  | $ | 1,274 |
All consideration from contracts with customers is included in the amounts presented above. INTELLICHECK, INC. NOTES TO FINANCIAL STATEMENTS (All dollar amounts are rounded to thousands, except share data) Advertising Costs. Advertising costs, which are charged to expense as incurred, were $745 and $227 for the years ended December 31, 2021 and 2020, respectively. Shipping Costs The Company’s shipping and handling costs are included in cost of revenues for all periods presented. Income Taxes The Company accounts for income taxes in accordance with ASC 740, “Income Taxes.” Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and net operating loss carryforwards. Deferred tax assets and liabilities are measured using expected tax rates in effect for the year in which those temporary differences are expected to be recovered or settled. Deferred tax assets are recognized subject to management’s judgment that realization is more likely than not. The Company has recorded a full valuation allowance for its net deferred tax assets as of December 31, 2021 and 2020, due to the uncertainty of the realizability of those assets. See Note 7. Fair Value of Financial Instruments The Company adheres to the provisions of ASC 820, “Fair Value Measurement” which requires the Company to calculate the fair value of financial instruments and include this additional information in the notes to financial statements when the fair value of those financial instruments is different than the book value. The Company’s financial instruments include cash, accounts receivable, other current assets, accounts payable and accrued expenses. At December 31, 2021 and 2020, the carrying value of the Company’s financial instruments approximated fair value, due to their short-term nature. All of the Company’s financial instruments are categorized as Level 1 within the fair value hierarchy. Business Concentration and Credit Risk Financial instruments, which subject the Company to concentrations of credit risk, consist primarily of cash. The Company maintains cash with two financial institutions. The Company performs periodic evaluations of the relative credit standing of these institutions. The Company’s sales are principally made to large retail customers, financial institutions concentrated in the United States of America and to U.S. government entities. The Company performs ongoing credit evaluations, generally does not require collateral, and establishes an allowance for doubtful accounts based upon factors surrounding the credit risk of customers, historical trends, and other information. During the year ended December 31, 2021, the Company made sales to two customers that accounted for approximately 55% of revenue. The revenue was associated with commercial identity sales customers. These two customers, in addition to one other customer, represented 65% of the Company’s December 31, 2021 accounts receivable balance. During the year ended December 31, 2020, the Company had two customers that accounted for 41% of revenue and 52% of its December 31, 2020 accounts receivable balance. INTELLICHECK, INC. NOTES TO FINANCIAL STATEMENTS (All dollar amounts are rounded to thousands, except share data) As of December 31, 2021, the Company had four suppliers to produce its input devices. The Company has modified its software to operate in windows-based systems and can integrate with different hardware platforms that are readily available in the marketplace. The Company does not maintain a manufacturing facility of its own and is not dependent on maintaining its production relationships due to the flexibility of its software to run on multiple existing platforms. Net Income (Loss) Per Share Basic net income (loss) per share is computed by dividing the net income (loss) for the period by the weighted average number of common shares outstanding during the period. Diluted net income (loss) per share is computed by dividing the net income (loss) for the period by the weighted average number of shares of common stock and potentially dilutive common stock equivalents outstanding during the period. The dilutive effect of these common stock equivalents comprising of outstanding options, warrants and restricted stock is reflected in diluted earnings per share by application of the treasury stock method. The calculation of diluted net income (loss) per share excludes all anti-dilutive shares. In a period of net loss, all common stock equivalents are considered anti-dilutive. SCHEDULE OF EARNINGS PER SHARE BASIC AND DILUTED
|  | 2021 |  |  | 2020 |
|  | Years Ended |
|  | December 31, |
|  | 2021 |  |  | 2020 |
Numerator: |  |  |  |  |  |  |  |
Net Loss |  | $ | (7,478 | ) |  | $ | (2,484 | )
Denominator: |  |  |  |  |  |  |  |
Weighted average common shares – |  |  |  |  |  |  |  |
Basic |  |  | 18,598,410 |  |  |  | 17,324,150 |
Weighted average common shares - |  |  |  |  |  |  |  |
Diluted |  |  | 18,598,410 |  |  |  | 17,324,150 |
Net Loss per share – |  |  |  |  |  |  |  |
Basic |  | $ | (0.40 | ) |  | $ | (0.14 | )
Diluted |  | $ | (0.40 | ) |  | $ | (0.14 | )
The following table summarizes the common stock equivalents excluded from the 2021 loss per diluted share because their effect would be anti-dilutive: SUMMARY OF COMMON STOCK EQUIVALENTS EXCLUDED FROM LOSS PER DILUTED SHARE
|  | 2021 |  |  | 2020 |
Stock options |  |  | 496,424 |  |  |  | 637,882 |
Restricted stock |  |  | 408,376 |  |  |  | 1,754 |
Performance stock units |  |  | 228,498 |  |  |  | 265,942 |
Total |  |  | 1,133,298 |  |  |  | 905,578 |
Equity Compensation The Company accounts for the issuance of equity awards to employees in accordance ASC 718 (“Stock Compensation”) and ASC 505 (“Equity”), which requires that the cost resulting from all equity payment transactions be recognized in the financial statements. This pronouncement establishes fair value as the measurement objective in accounting for equity payment arrangements and requires all companies to apply a fair value-based measurement method in accounting for all equity payment transactions with employees. All equity compensation expenses are included in operating expenses. The Company recognizes compensation expense related to stock option grants on a straight-line basis over the vesting period. See Note 8. INTELLICHECK, INC. NOTES TO FINANCIAL STATEMENTS (All dollar amounts are rounded to thousands, except share data) Comprehensive Loss The Company’s comprehensive loss is equal to its net loss for the years ended December 31, 2021 and 2020. Segment Information The Company adheres to the provisions of ASC 280 (“Segment Reporting”), which establishes standards for the way public business enterprises report information about operating segments in annual financial statements and requires that those enterprises report selected information about operating segments in financial statements issued to shareholders. Management has determined that it has only one reporting segment. Recent Accounting Pronouncements In December 2019, the Financial Accounting Standards Board (“FASB”) issued ASU 2019-12, “Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes” as part of its initiative to reduce complexity in the accounting standards. The standard eliminates certain exceptions related to the approach for intraperiod tax allocation, the methodology for calculating income taxes in an interim period and the recognition of deferred tax liabilities for outside basis differences. The standard also clarifies and simplifies other aspects of the accounting for income taxes. The standard is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020 and early adoption is permitted. The adoption of this standard did not have a material impact on the Company’s financial statements. In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments to measure credit losses on financial instruments, including trade receivables. The guidance eliminates the probable initial recognition threshold that was previously required prior to recognizing a credit loss on financial instruments. The credit loss estimate can now reflect an entity’s current estimate of all future expected credit losses. Under the previous guidance, an entity only considered past events and current conditions. The guidance is effective for smaller reporting companies for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. Early adoption is permitted for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. The adoption of certain amendments of this guidance must be applied on a modified retrospective basis and the adoption of the remaining amendments must be applied on a prospective basis. The Company does not expect this standard will have a material impact on its financial statements. INTELLICHECK, INC. NOTES TO FINANCIAL STATEMENTS (All dollar amounts are rounded to thousands, except share data)

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- References No definition available. + Details
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- Definition The entire disclosure for all significant accounting policies of the reporting entity. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=123372394&loc=d3e18726-107790 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -URI http://asc.fasb.org/topic&trid=2122369 + Details
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