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17. Income Taxes (Tables)

12 Months Ended

Sep. 30, 2017

Income Tax Disclosure [Abstract]

Reconciliation of income tax expense

		2017				2016 (Restated)
Current expense:
Federal		$	313,405			$	103,704
State			243,841				52,745
			557,246				156,449
Deferred expense:
Federal			3,397,732				(15,114,529	)
State			126,841				(609,764	)
			3,524,573				(15,724,293	)
Total income tax expense		$	4,081,819			$	(15,567,844	)

Reconciliation between effective and statutory income tax rates

A reconciliation of the differences between the effective and statutory income tax rates for years ended September 30:

		2017								2016 (Restated)
		Amount				Percent				Amount				Percent
Federal statutory rates		$	3,598,424				34%			$	1,830,150				77%
State income taxes			299,216				3%				161,484				7%
Permanent differences			71,908				1%				(1,798,450	)			-75%
Net operating loss adjustment			–								(1,194,004	)			-50%
Property & equipment adjustment			–								742,854				31%
Equity compensation adjustment			–								(2,872,210	)			-120%
Valuation allowance against net deferred tax assets			–								(12,284,278	)			-515%
Other			112,271				1%				(153,390	)			-6%
Effective rate		$	4,081,819				39%			$	(15,567,844	)			-652%

The Company restated the prior year deferred income taxes related to the Marquis acquisition. Certain deferred tax items were not recorded by the Company. The Company has adjusted the deferred taxes associated with property and equipment and stock compensation.

		September 30, 2016
		As previously
		Reported				Adjustment				As restated
Income tax expense (benefit):
Federal statuary rate		$	1,830,150			$	–			$	1,830,150
State taxes, net of federal benefit			161,484				–				161,484
Permanent difference			(852,646	)			(945,804	)			(1,798,450	)
Net operating loss adjustment			(1,083,866	)			(110,138	)			(1,194,004	)
Property and equipment adjustment			–				742,854				742,854
Equity compensation adjustment			–				(2,872,210	)			(2,872,210	)
Valuation allowance			(12,284,278	)			–				(12,284,278	)
Other			(264,065	)			110,675				(153,390	)
		$	(12,493,221	)		$	(3,074,623	)		$	(15,567,844	)

Schedule of deferred income tax assets and liabilities

		2017				2016 (Restated)
Deferred income tax asset, current:
Allowance for bad debts		$	401,867			$	406,733
Accrued expenses			31,183				241,536
Inventory			772,657				414,575
Accrued compensation			–				–
Total deferred income tax asset, current			1,205,706				1,062,844
Less: valuation allowance			–				–
Deferred income tax asset, current, net			1,205,706				1,062,844
Deferred income tax asset (liability), long-term:
Net operating loss			7,804,948				9,915,371
Tax credits			377,776				–
Other			3,743				–
Stock compensation			2,982,009				–
Intangibles			13,126				794,455
Property & equipment			(3,387,298	)			751,912
Total deferred income tax asset, long-term			7,794,304				11,461,738
Less: valuation allowance			–				–
Deferred income tax asset, net			7,794,304				11,461,738
Total deferred income tax asset		$	9,000,010			$	12,524,582

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Tabular disclosure of the components of income tax expense attributable to continuing operations for each year presented including, but not limited to: current tax expense (benefit), deferred tax expense (benefit), investment tax credits, government grants, the benefits of operating loss carryforwards, tax expense that results from allocating certain tax benefits either directly to contributed capital or to reduce goodwill or other noncurrent intangible assets of an acquired entity, adjustments of a deferred tax liability or asset for enacted changes in tax laws or rates or a change in the tax status of the entity, and adjustments of the beginning-of-the-year balances of a valuation allowance because of a change in circumstances that causes a change in judgment about the realizability of the related deferred tax asset in future years.

+ References

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-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section 50
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Tabular disclosure of the components of net deferred tax asset or liability recognized in an entity's statement of financial position, including the following: the total of all deferred tax liabilities, the total of all deferred tax assets, the total valuation allowance recognized for deferred tax assets.

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-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section 50
-Paragraph 2
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Tabular disclosure of the reconciliation using percentage or dollar amounts of the reported amount of income tax expense attributable to continuing operations for the year to the amount of income tax expense that would result from applying domestic federal statutory tax rates to pretax income from continuing operations.

+ References

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-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section 50
-Paragraph 12
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