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Note 4: Balance Sheet Information

12 Months Ended

Sep. 30, 2012

Balance sheet information is as follows:

	September 30,
	2012			2011

Receivables, current, net:
Accounts receivable, current	$	1,863,067		$	2,080,747
Less: Allowance for doubtful accounts		(1,423,219	)		(1,425,891	)
	$	439,848		$	654,856
Receivables, long term, net:
Accounts receivable, long term	$	510,587		$	569,178
Less: Allowance for doubtful accounts		(136,017	)		(197,740	)
	$	374,570		$	371,438
Total receivables, net:
Gross receivables	$	2,373,654		$	2,649,925
Less: Allowance for doubtful accounts		(1,559,236	)		(1,623,631	)
	$	814,418		$	1,026,294

Long term receivables consist of reserves held by LEC processors that are not expected to be settled within 12 months.

Approximately 93% of the Company’s allowance for doubtful accounts is an allowance against accounts receivable balances and reserves held by a LEC that is in bankruptcy and an allowance against an outstanding receivable balance that is in dispute. After excluding these reserves from the related accounts receivable balances, the allowance for doubtful accounts as a percentage of gross accounts receivable decreases to 12.6%. See note 12 for Concentration of Credit Risk.

Components of allowance for doubtful accounts are as follows:

	September 30,
	2012		2011

Allowance for dilution and fees on amounts due from billing aggregators	$	1,525,126	$	1,477,769
Allowance for customer refunds		34,111		145,862
	$	1,559,237	$	1,623,631

	September 30,
	2012			2011

Property and equipment, net:
Leasehold improvements	$	–		$	201,476
Furnishings and fixtures		94,511			233,577
Office, computer equipment and other		361,685			426,931
		456,196			861,984
Less: Accumulated depreciation		(405,670	)		(690,783	)
	$	50,526		$	171,201

	September 30,
	2012			2011

Intangible assets, net:
Domain name and marketing related intangibles	$	1,511,650		$	1,509,600
Website and technology related intangibles		1,252,304			351,941
		2,763,954			1,861,541
Less: Accumulated amortization		(766,283	)		(639,207	)
	$	1,997,671		$	1,222,334

The change in intangibles is attributable to $420,000 of intangibles acquired in the LiveOpenly acquisition and $482,413 of website development costs.

	September 30,
	2012		2011

Accrued liabilities:
Deferred revenue	$	2,310	$	14,553
Accrued payroll and bonuses		28,968		63,043
Accruals under revenue sharing agreements		67,601		86,550
Accrued expenses - other		311,225		260,449
	$	410,104	$	424,595