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Restatement of Previously Issued Financial Statements | 12 Months Ended
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Mar. 31, 2023
Accounting Changes and Error Corrections [Abstract] |
Restatement of Previously Issued Financial Statements | Restatement of Previously Issued Financial Statements The audited financial statements for the years ended March 31, 2023, 2022 and 2021, as well as the unaudited quarterly financial information for the quarterly periods in the fiscal years ended March 31, 2023 and 2022 (collectively, the "Affected Periods") have been restated to correct material misstatements related to the collection of sales taxes on sales of products or goods to customers as further described below (the "Misstatements"). Additional errors were identified relating to the accounting treatment related to the deferred tax asset associated with the Company’s acquisition of PetCareRx in April 2023, reported in the first and second quarter of fiscal year 2024, which does not impact the Affected Periods. The Company also restated all amounts impacted within the notes to the financial statements in this Amendment. A description of the adjustments and their impacts on the previously issued financial statements are included below. Description of restatement adjustments In the third quarter of fiscal year 2024, the Company, reviewed the accounting treatment related to its previously reported sales tax accruals as well as the accounting treatment related to the valuation of the deferred tax asset associated with the Company’s acquisition of PetCareRx in April 2023. As a result of this review, management determined that the Company incorrectly applied GAAP as it relates to the sales tax liability included in our consolidated financial statements for each of the Affected Periods, and that it improperly valued the deferred tax asset and goodwill reported in the first and second quarters of fiscal year 2024. The restated sales tax accrual amounts assume that (i) customers who have not yet provided certificates or other documentation of exemption from sales tax are taxable, (ii) total potential interest and penalty assessments may be imposed, and (iii) the Company will not receive waivers of interest and penalties or other benefits under agreements it may obtain with jurisdictions from its outreach with voluntary disclosures. The Company expects to make adjustments to the sales tax liability in future periods as and if it obtains any waivers of interest and penalties or other benefits from its voluntary disclosures and as and if it obtains additional documentation from customers supporting exemption from sales tax. In connection with the Company’s evaluation of the Misstatements, additional errors were identified relating to the valuation of deferred taxes associated with the Company’s acquisition of PetCareRx in April 2023. These errors do not impact the Company’s consolidated financial statements for the Affected Periods and the correction of these errors will be reflected in the restatements included in our Amended Quarterly Reports. A summary of the impact of the adjustments described above relating to the Misstatements as of, and for the fiscal years ended March 31, 2023, 2022 and 2021, is as follows:
|  | Year ended
|  | March 31, 2023 |  | March 31, 2022 |  | March 31, 2021
(in thousands) |  | As previously reported |  | As restated |  | As previously reported |  | As restated |  | As previously reported |  | As restated
Sales |  | $ | 256,858 |  |  | $ | 256,579 |  |  | $ | 273,417 |  |  | $ | 272,282 |  |  | $ | 309,215 |  |  | $ | 303,583 |
Gross profit |  | $ | 71,014 |  |  | $ | 70,735 |  |  | $ | 78,076 |  |  | $ | 76,941 |  |  | $ | 89,948 |  |  | $ | 84,316 |
Income (loss) from operations |  | $ | (1,430) |  |  | $ | 6,051 |  |  | $ | 25,710 |  |  | $ | 24,290 |  |  | $ | 37,587 |  |  | $ | 30,531 |
Net income (loss) |  | $ | 233 |  |  | $ | 5,140 |  |  | $ | 21,100 |  |  | $ | 18,716 |  |  | $ | 30,603 |  |  | $ | 23,919 |
| Year ended
| March 31, 2023 |  | March 31, 2022 |  | March 31, 2021
| As previously reported |  | As restated |  | As previously reported |  | As restated |  | As previously reported |  | As restated
Net income (numerator): |  |  |  |  |  |  |  |  |  |  |
Net income | $ | 233 |  |  | $ | 5,140 |  |  | $ | 21,100 |  |  | $ | 18,716 |  |  | $ | 30,603 |  |  | $ | 23,919 |
Shares (denominator): |  |  |  |  |  |  |  |  |  |  |
Weighted average number of common shares outstanding used in basic computation | 20,275 |  | 20,275 |  | 20,176 |  | 20,176 |  | 20,060 |  | 20,060
Common shares issuable upon the vesting of restricted stock | 54 |  | 54 |  | 172 |  | 172 |  | 49 |  | 49
Common shares issuable upon conversion of preferred shares | 10 |  | 10 |  | 10 |  | 10 |  | 10 |  | 10
Shares used in diluted computation | 20,339 |  | 20,339 |  | 20,358 |  | 20,358 |  | 20,119 |  | 20,119
Net income per common share: |  |  |  |  |  |  |  |  |  |  |
Basic | $ | 0.01 |  |  | $ | 0.25 |  |  | $ | 1.05 |  |  | $ | 0.93 |  |  | $ | 1.53 |  |  | $ | 1.19 |
Diluted | $ | 0.01 |  |  | $ | 0.25 |  |  | $ | 1.04 |  |  | $ | 0.92 |  |  | $ | 1.52 |  |  | $ | 1.19 |
We also restated unaudited interim financial information impacted by the Misstatements for the quarterly periods ended June 30, 2022, and 2021, September 30, 2022, and 2021, and December 31, 2022 and 2021. The categories of restatement adjustments and their impacts on previously reported financial statements are described below and identified in the Restatement Reconciliation Tables in the column entitled "Reference": a. Sales Tax – Sales tax on sales of services to customers who were subject to sales tax, inclusive of the total potential penalties and interest, that was not previously accrued by the Company is corrected by an increase to sales tax liabilities on the consolidated balance sheets. The effect of the adjustments on the consolidated statements of operations were recorded as a reduction to sales for the amount of tax, an increase to general and administrative expenses for accrued penalties and interest is included in other interest(expense) on the consolidated statements of operations. b. Tax provision / accrual – Tax provisions, deferred tax assets and liabilities were adjusted based on restated net income. Consolidated Financial Statements - Restatement Reconciliation Tables In light of the foregoing, in accordance with ASC 250, Accounting Changes and Error Corrections, we are restating the previously issued consolidated financial statements as of March 31, 2023 and 2022, and for the years ended March 31, 2023, 2022 and 2021, to reflect the effects of the restatement adjustments and to make certain corresponding disclosures. In the following tables, we have presented a reconciliation of our consolidated balance sheets, statements of operations, and cash flows as previously reported for these prior periods to the restated and revised amounts. Summary of Restatement - Consolidated Balance Sheets
| March 31, 2023 |  | March 31, 2022
| As Previously Reported |  | Restatement Adjustments |  | Refer-ence |  | As Restated |  | As Previously Reported |  | Restatement Adjustments |  | Refer-ence |  | As Restated
ASSETS |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Current assets: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Cash and cash equivalents | $ | 104,086 |  |  | $ | — |  |  |  |  | $ | 104,086 |  |  | $ | 111,080 |  |  | $ | — |  |  |  |  | $ | 111,080 |
Accounts receivable, less allowance for doubtful accounts of $35 and $39, respectively | 1,740 |  |  | — |  |  |  |  | 1,740 |  |  | 1,913 |  |  | — |  |  |  |  | 1,913 |
Inventories - finished goods | 19,023 |  |  | — |  |  |  |  | 19,023 |  |  | 32,455 |  |  | — |  |  |  |  | 32,455 |
Prepaid expenses and other current assets | 4,719 |  |  |  |  |  |  | 4,719 |  |  | 4,866 |  |  | — |  |  |  |  | 4,866 |
Prepaid income taxes | 1,883 |  |  | (1,020) |  |  | b |  | 863 |  |  | 681 |  |  | — |  |  |  |  | 681 |
Total current assets | 131,451 |  |  | (1,020) |  |  |  |  | 130,431 |  |  | 150,995 |  |  | — |  |  |  |  | 150,995 |
Noncurrent assets: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Property and equipment, net | 26,178 |  |  | — |  |  |  |  | 26,178 |  |  | 24,464 |  |  | — |  |  |  |  | 24,464 |
Intangible and other assets | 5,860 |  |  | — |  |  |  |  | 5,860 |  |  | 860 |  |  | — |  |  |  |  | 860 |
Deferred tax assets, net | 628 |  |  | 4,381 |  |  | b |  | 5,009 |  |  | — |  |  | 3,379 |  |  | b |  | 3,379 |
Total noncurrent assets | 32,666 |  |  | 4,381 |  |  |  |  | 37,047 |  |  | 25,324 |  |  | 3,379 |  |  |  |  | 28,703 |
Total assets | $ | 164,117 |  |  | $ | 3,361 |  |  |  |  | $ | 167,478 |  |  | $ | 176,319 |  |  | $ | 3,379 |  |  |  |  | $ | 179,698 |
| March 31, 2023 |  | March 31, 2022
| As Previously Reported |  | Restatement Adjustments |  | Refer-ence |  | As Restated |  | As Previously Reported |  | Restatement Adjustments |  | Refer-ence |  | As Restated
LIABILITIES AND SHAREHOLDERS' EQUITY |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Current liabilities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Accounts payable | $ | 25,208 |  |  | $ | — |  |  |  |  | $ | 25,208 |  |  | $ | 27,500 |  |  | $ | — |  |  |  |  | $ | 27,500 |
Sales tax payable | — |  |  | 26,113 |  |  | a |  | 26,113 |  |  | — |  |  | 24,157 |  |  | a |  | 24,157 |
Accrued expenses and other current liabilities | 11,289 |  |  | (5,098) |  |  | a |  | 6,191 |  |  | 5,697 |  |  | (1,106) |  |  | a |  | 4,591 |
Income taxes payable | — |  |  | — |  |  |  |  | — |  |  | — |  |  | — |  |  |  |  | — |
Total current liabilities | 36,497 |  |  | 21,015 |  |  |  |  | 57,512 |  |  | 33,197 |  |  | 23,051 |  |  |  |  | 56,248 |
Deferred tax liabilities | — |  |  | — |  |  |  |  | — |  |  | 936 |  |  | (936) |  |  | b |  | — |
Other long-term liabilities | 3,825 |  |  | (3,825) |  |  | a |  | — |  |  | — |  |  | — |  |  |  |  | — |
Total liabilities | 40,322 |  |  | 17,190 |  |  |  |  | 57,512 |  |  | 34,133 |  |  | 22,115 |  |  |  |  | 56,248 |
Commitments and contingencies |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Shareholders' equity: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Preferred stock, $.001 par value, 5,000 shares authorized; 3 convertible shares issued and outstanding with a liquidation preference of $4 per share | 9 |  |  | — |  |  |  |  | 9 |  |  | 9 |  |  | — |  |  |  |  | 9 |
Common stock, $.001 par value, 40,000 shares authorized; 21,084 and 20,979 shares issued and outstanding, respectively | 21 |  |  | — |  |  |  |  | 21 |  |  | 21 |  |  | — |  |  |  |  | 21 |
Additional paid-in capital | 18,277 |  |  | — |  |  |  |  | 18,277 |  |  | 11,660 |  |  | — |  |  |  |  | 11,660 |
Retained earnings | 105,488 |  |  | (13,829) |  |  | a, b |  | 91,659 |  |  | 130,496 |  |  | (18,736) |  |  | a, b |  | 111,760 |
Total shareholders' equity | 123,795 |  |  | (13,829) |  |  |  |  | 109,966 |  |  | 142,186 |  |  | (18,736) |  |  |  |  | 123,450 |
Total liabilities and shareholders' equity | $ | 164,117 |  |  | $ | 3,361 |  |  |  |  | $ | 167,478 |  |  | $ | 176,319 |  |  | $ | 3,379 |  |  |  |  | $ | 179,698 |
Summary of Restatement - Consolidated Statements of Operations
| Year ended March 31, 2023 |  | Year ended March 31, 2022
| As Previously Reported |  | Restatement Adjustments |  | Refer-ence |  | As Restated |  | As Previously Reported |  | Restatement Adjustments |  | Refer-ence |  | As Restated
Sales | $ | 256,858 |  |  | $ | (279) |  |  | a |  | $ | 256,579 |  |  | $ | 273,417 |  |  | $ | (1,135) |  |  | a |  | $ | 272,282 |
Cost of sales | 185,844 |  |  | — |  |  |  |  | 185,844 |  |  | 195,341 |  |  | — |  |  |  |  | 195,341 |
Gross profit | 71,014 |  |  | (279) |  |  |  |  | 70,735 |  |  | 78,076 |  |  | (1,135) |  |  |  |  | 76,941 |
Operating expenses: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
General and administrative | 49,474 |  |  | (7,760) |  |  | a |  | 41,714 |  |  | 30,829 |  |  | 285 |  |  | a |  | 31,114 |
Advertising | 19,424 |  |  | — |  |  |  |  | 19,424 |  |  | 18,799 |  |  | — |  |  |  |  | 18,799 |
Depreciation | 3,546 |  |  | — |  |  |  |  | 3,546 |  |  | 2,738 |  |  | — |  |  |  |  | 2,738 |
Total operating expenses | 72,444 |  |  | (7,760) |  |  |  |  | 64,684 |  |  | 52,366 |  |  | 285 |  |  |  |  | 52,651 |
(Loss) income from operations | (1,430) |  |  | 7,481 |  |  |  |  | 6,051 |  |  | 25,710 |  |  | (1,420) |  |  |  |  | 24,290 |
Other income: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Interest income (expense), net | 2,070 |  |  | (1,620) |  |  | a |  | 450 |  |  | 335 |  |  | (1,466) |  |  | a |  | (1,131) |
Other, net | 944 |  |  | — |  |  |  |  | 944 |  |  | 1,026 |  |  | — |  |  |  |  | 1,026 |
Total other income | 3,014 |  |  | (1,620) |  |  |  |  | 1,394 |  |  | 1,361 |  |  | (1,466) |  |  |  |  | (105) |
Income before provision for income taxes | 1,584 |  |  | 5,861 |  |  |  |  | 7,445 |  |  | 27,071 |  |  | (2,886) |  |  |  |  | 24,185 |
Provision for income taxes | 1,351 |  |  | 954 |  |  | b |  | 2,305 |  |  | 5,971 |  |  | (502) |  |  | b |  | 5,469 |
Net income | $ | 233 |  |  | $ | 4,907 |  |  |  |  | $ | 5,140 |  |  | $ | 21,100 |  |  | $ | (2,384) |  |  |  |  | $ | 18,716 |
Net income per common share: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Basic | $ | 0.01 |  |  | $ | 0.24 |  |  |  |  | $ | 0.25 |  |  | $ | 1.05 |  |  | $ | (0.12) |  |  |  |  | $ | 0.93 |
Diluted | $ | 0.01 |  |  | $ | 0.24 |  |  |  |  | $ | 0.25 |  |  | $ | 1.04 |  |  | $ | (0.12) |  |  |  |  | $ | 0.92 |
Weighted average number of common shares outstanding: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Basic | 20,275 |  |  | — |  |  |  |  | 20,275 |  |  | 20,176 |  |  | — |  |  |  |  | 20,176 |
Diluted | 20,339 |  |  | — |  |  |  |  | 20,339 |  |  | 20,358 |  |  | — |  |  |  |  | 20,358 |
Cash dividends declared per common share | $ | 1.20 |  |  | $ | — |  |  |  |  | $ | 1.20 |  |  | $ | 1.20 |  |  | $ | — |  |  |  |  | $ | 1.20 |
| Year ended March 31, 2021
| As Previously Reported |  | Restatement Adjustments |  | Refer-ence |  | As Restated
Sales | $ | 309,215 |  |  | $ | (5,632) |  |  | a |  | $ | 303,583 |
Cost of sales | 219,267 |  |  | — |  |  |  |  | 219,267 |
Gross profit | 89,948 |  |  | (5,632) |  |  |  |  | 84,316 |
Operating expenses: |  |  |  |  |  |  |
General and administrative | 28,293 |  |  | 1,424 |  |  | a |  | 29,717 |
Advertising | 21,641 |  |  | — |  |  |  |  | 21,641 |
Depreciation | 2,427 |  |  | — |  |  |  |  | 2,427 |
Total operating expenses | 52,361 |  |  | 1,424 |  |  |  |  | 53,785 |
(Loss) income from operations | 37,587 |  |  | (7,056) |  |  |  |  | 30,531 |
Other income: |  |  |  |  |  |  |
Interest income (expense), net | 314 |  |  | (1,210) |  |  | a |  | (896) |
Other, net | 1,315 |  |  | — |  |  |  |  | 1,315 |
Total other income | 1,629 |  |  | (1,210) |  |  |  |  | 419 |
Income before provision for income taxes | 39,216 |  |  | (8,266) |  |  |  |  | 30,950 |
Provision for income taxes | 8,613 |  |  | (1,582) |  |  | b |  | 7,031 |
Net income | $ | 30,603 |  |  | $ | (6,684) |  |  |  |  | $ | 23,919 |
Net income per common share: |  |  |  |  |  |  |
Basic | $ | 1.53 |  |  | $ | (0.33) |  |  |  |  | $ | 1.19 |
Diluted | $ | 1.52 |  |  | $ | (0.33) |  |  |  |  | $ | 1.19 |
Weighted average number of common shares outstanding: |  |  |  |  |  |  |
Basic | 20,060 |  |  | — |  |  |  |  | 20,060 |
Diluted | 20,119 |  |  | — |  |  |  |  | 20,119 |
Cash dividends declared per common share | $ | 1.12 |  |  | $ | — |  |  |  |  | $ | 1.12 |
Summary of Restatement - Consolidated Cash Flow Statement
|  | Year ended March 31, 2023 |  | Year ended March 31, 2022 |  |  |  |  |  |  |  |  |
|  | As Previously Reported |  | Restatement Adjustments |  | Refer-ence |  | As Restated |  | As Previously Reported |  | Restatement Adjustments |  | Refer-ence |  | As Restated |  |  |  |  |  |  |  |  |
Cash flows from operating activities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Net income |  | $ | 233 |  |  | $ | 4,907 |  |  | a |  | $ | 5,140 |  |  | $ | 21,100 |  |  | $ | (2,384) |  |  | a |  | $ | 18,716 |  |  |  |  |  |  |  |  |  |
Adjustments to reconcile net income to net cash provided by operating activities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Depreciation |  | 3,546 |  |  | — |  |  |  |  | 3,546 |  |  | 2,738 |  |  | — |  |  |  |  | 2,738 |  |  |  |  |  |  |  |  |  |
Share based compensation |  | 6,617 |  |  | — |  |  |  |  | 6,617 |  |  | 4,549 |  |  | — |  |  |  |  | 4,549 |  |  |  |  |  |  |  |  |  |
Deferred income taxes |  | (1,564) |  |  | (66) |  |  | b |  | (1,630) |  |  | (345) |  |  | (501) |  |  | b |  | (846) |  |  |  |  |  |  |  |  |  |
Bad debt expense |  | 214 |  |  | — |  |  |  |  | 214 |  |  | 165 |  |  | — |  |  |  |  | 165 |  |  |  |  |  |  |  |  |  |
(Increase) decrease in operating assets and increase (decrease) in liabilities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Accounts receivable |  | (41) |  |  | — |  |  |  |  | (41) |  |  | 509 |  |  | — |  |  |  |  | 509 |  |  |  |  |  |  |  |  |  |
Inventories - finished goods |  | 13,432 |  |  | — |  |  |  |  | 13,432 |  |  | 1,965 |  |  | — |  |  |  |  | 1,965 |  |  |  |  |  |  |  |  |  |
Prepaid income taxes |  | (1,202) |  |  | 1,020 |  |  | b |  | (182) |  |  | 278 |  |  | — |  |  |  |  | 278 |  |  |  |  |  |  |  |  |  |
Prepaid expenses and other current assets |  | 147 |  |  | — |  |  |  |  | 147 |  |  | (363) |  |  | — |  |  |  |  | (363) |  |  |  |  |  |  |  |  |  |
Accounts payable |  | (2,292) |  |  | — |  |  |  |  | (2,292) |  |  | (12,048) |  |  | — |  |  |  |  | (12,048) |  |  |  |  |  |  |  |  |  |
Sales tax payable |  | — |  |  | 1,956 |  |  | a |  | 1,956 |  |  | — |  |  | 2,928 |  |  | a |  | 2,928 |  |  |  |  |  |  |  |  |  |
Accrued expenses and other current liabilities |  | 8,713 |  |  | (7,817) |  |  | a |  | 896 |  |  | (50) |  |  | (43) |  |  | a |  | (93) |  |  |  |  |  |  |  |  |  |
Net cash provided by operating activities |  | 27,803 |  |  | — |  |  |  |  | 27,803 |  |  | 18,498 |  |  | — |  |  |  |  | 18,498 |  |  |  |  |  |  |  |  |  |
Cash flows from investing activities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Purchase of minority interest investment in Vetster |  | (5,000) |  |  | — |  |  |  |  | (5,000) |  |  | — |  |  | — |  |  |  |  | — |  |  |  |  |  |  |  |  |  |
Purchases of property and equipment |  | (5,260) |  |  | — |  |  |  |  | (5,260) |  |  | (1,752) |  |  | — |  |  |  |  | (1,752) |  |  |  |  |  |  |  |  |  |
Net cash used in investing activities |  | (10,260) |  |  | — |  |  |  |  | (10,260) |  |  | (1,752) |  |  | — |  |  |  |  | (1,752) |  |  |  |  |  |  |  |  |  |
Cash flows from financing activities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Dividends paid |  | (24,537) |  |  | — |  |  |  |  | (24,537) |  |  | (24,384) |  |  | — |  |  |  |  | (24,384) |  |  |  |  |  |  |  |  |  |
Net cash used in financing activities |  | (24,537) |  |  | — |  |  |  |  | (24,537) |  |  | (24,384) |  |  | — |  |  |  |  | (24,384) |  |  |  |  |  |  |  |  |  |
Net (decrease) increase in cash and cash equivalents |  | (6,994) |  |  | — |  |  |  |  | (6,994) |  |  | (7,638) |  |  | — |  |  |  |  | (7,638) |  |  |  |  |  |  |  |  |  |
Cash and cash equivalents, at beginning of year |  | 111,080 |  |  | — |  |  |  |  | 111,080 |  |  | 118,718 |  |  | — |  |  |  |  | 118,718 |  |  |  |  |  |  |  |  |  |
Cash and cash equivalents, at end of year |  | $ | 104,086 |  |  | $ | — |  |  |  |  | $ | 104,086 |  |  | $ | 111,080 |  |  | $ | — |  |  |  |  | $ | 111,080 |  |  |  |  |  |  |  |  |  |
Supplemental disclosure of cash flow information: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Cash paid for income taxes |  | $ | 4,312 |  |  | $ | — |  |  |  |  | $ | 4,312 |  |  | $ | 6,085 |  |  | $ | — |  |  |  |  | $ | 6,085 |  |  |  |  |  |  |  |  |  |
Dividends payable in accrued expenses |  | $ | 1,262 |  |  | $ | — |  |  |  |  | $ | 1,262 |  |  | $ | 558 |  |  | $ | — |  |  |  |  | $ | 558 |  |  |  |  |  |  |  |  |  |
|  | Year ended March 31, 2021
|  | As Previously Reported |  | Restatement Adjustments |  | Refer-ence |  | As Restated
Cash flows from operating activities: |  |  |  |  |  |  |  |
Net income |  | $ | 30,603 |  |  | $ | (6,684) |  |  | a |  | $ | 23,919 |
Adjustments to reconcile net income to net cash provided by operating activities: |  |  |  |  |  |  |  |
Depreciation |  | 2,427 |  |  | — |  |  |  |  | 2,427 |
Share based compensation |  | 3,307 |  |  | — |  |  |  |  | 3,307 |
Deferred income taxes |  | 311 |  |  | (1,584) |  |  |  |  | (1,273) |
Bad debt expense |  | 130 |  |  | — |  |  |  |  | 130 |
(Increase) decrease in operating assets and increase (decrease) in liabilities: |  |  |  |  |  |  |  |
Accounts receivable |  | 1,126 |  |  | — |  |  |  |  | 1,126 |
Inventories - finished goods |  | (16,536) |  |  | — |  |  |  |  | (16,536) |
Prepaid income taxes |  | (959) |  |  | — |  |  |  |  | (959) |
Prepaid expenses and other current assets |  | (974) |  |  | — |  |  |  |  | (974) |
Accounts payable |  | 19,890 |  |  | — |  |  |  |  | 19,890 |
Sales tax payable |  | — |  |  | 8,268 |  |  | a |  | 8,268 |
Accrued expenses and other current liabilities |  | 1,221 |  |  | — |  |  |  |  | 1,221 |
Income taxes payable |  | (471) |  |  | — |  |  |  |  | (471) |
Net cash provided by operating activities |  | 40,075 |  |  | — |  |  |  |  | 40,075 |
Cash flows from investing activities: |  |  |  |  |  |  |  |
Purchase of minority interest investment in Vetster |  | — |  |  | — |  |  |  |  | — |
Purchases of property and equipment |  | (2,432) |  |  | — |  |  |  |  | (2,432) |
Net cash used in investing activities |  | (2,432) |  |  | — |  |  |  |  | (2,432) |
Cash flows from financing activities: |  |  |  |  |  |  |  |
Dividends paid |  | (22,687) |  |  | — |  |  |  |  | (22,687) |
Net cash used in financing activities |  | (22,687) |  |  | — |  |  |  |  | (22,687) |
Net (decrease) increase in cash and cash equivalents |  | 14,956 |  |  | — |  |  |  |  | 14,956 |
Cash and cash equivalents, at beginning of year |  | 103,762 |  |  | — |  |  |  |  | 103,762 |
Cash and cash equivalents, at end of year |  | $ | 118,718 |  |  | $ | — |  |  |  |  | $ | 118,718 |
Supplemental disclosure of cash flow information: |  |  |  |  |  |  |  |
Cash paid for income taxes |  | $ | 10,018 |  |  | $ | — |  |  |  |  | $ | 10,018 |
Dividends payable in accrued expenses |  | $ | 198 |  |  | $ | — |  |  |  |  | $ | 198 |
Quarterly Financial Statements (Unaudited) The following tables set forth the corrections in each of the individual line items affected in the condensed consolidated statements of income for each respective period:
| Three Months Ended
| June 30, 2021 |  | September 30, 2021
| As Previously Reported |  | Restatement Adjustments |  | Refer-ence |  | As Restated |  | As Previously Reported |  | Restatement Adjustments |  | Refer-ence |  | As Restated
Sales | $ | 79,312 |  |  | $ | (550) |  |  | a |  | $ | 78,762 |  |  | $ | 67,386 |  |  | $ | (289) |  |  | a |  | $ | 67,097 |
General and administrative | 8,041 |  |  | 135 |  |  | a |  | 8,176 |  |  | 6,958 |  |  | 73 |  |  | a |  | 7,031 |
Interest income (expense), net | 85 |  |  | (350) |  |  | a |  | (265) |  |  | 74 |  |  | (362) |  |  | a |  | (288) |
Provision for income taxes | 1,360 |  |  | (186) |  |  | b |  | 1,174 |  |  | 1,982 |  |  | (149) |  |  | b |  | 1,833 |
Net income | $ | 4,428 |  |  | $ | (849) |  |  | a, b |  | $ | 3,579 |  |  | $ | 6,349 |  |  | $ | (575) |  |  | a, b |  | $ | 5,774 |
| Three Months Ended
| December 31, 2021 |  | March 31, 2022
| As Previously Reported |  | Restatement Adjustments |  | Refer-ence |  | As Restated |  | As Previously Reported |  | Restatement Adjustments |  | Refer-ence |  | As Restated
Sales | $ | 60,717 |  |  | $ | (143) |  |  | a |  | $ | 60,574 |  |  | $ | 66,002 |  |  | $ | (153) |  |  | a |  | $ | 65,849 |
General and administrative | 7,541 |  |  | 37 |  |  | a |  | 7,578 |  |  | 8,289 |  |  | 40 |  |  | a |  | 8,329 |
Interest income (expense), net | 84 |  |  | (373) |  |  | a |  | (289) |  |  | 92 |  |  | (381) |  |  | a |  | (289) |
Provision for income taxes | 1,261 |  |  | (119) |  |  | b |  | 1,142 |  |  | 1,368 |  |  | (48) |  |  | b |  | 1,320 |
Net income | $ | 4,257 |  |  | $ | (434) |  |  | a, b |  | $ | 3,823 |  |  | $ | 6,066 |  |  | $ | (526) |  |  | a, b |  | $ | 5,540 |
The following tables set forth the corrections in each of the individual line items affected in the condensed consolidated balance sheets for each respective period:
| June 30, 2021 |  | September 30, 2021
| As Previously Reported |  | Restatement Adjustments |  | Refer-ence |  | As Restated |  | As Previously Reported |  | Restatement Adjustments |  | Refer-ence |  | As Restated
Deferred tax assets | $ | — |  |  | $ | 2,886 |  |  | b |  | $ | 2,886 |  |  | $ | — |  |  | $ | 2,521 |  |  | b |  | $ | 2,521 |
Sales tax payable | — |  |  | 21,201 |  |  | a |  | 21,201 |  |  | — |  |  | 21,925 |  |  | a |  | 21,925 |
Deferred tax liabilities | 1,114 |  |  | (1,114) |  |  | b |  | — |  |  | 1,627 |  |  | (1,627) |  |  | b |  | — |
Retained earnings | 132,489 |  |  | (17,201) |  |  | a, b |  | 115,288 |  |  | 132,746 |  |  | (17,777) |  |  | a, b |  | 114,969 |
| December 31, 2021 |  | March 31, 2022
| As Previously Reported |  | Restatement Adjustments |  | Refer-ence |  | As Restated |  | As Previously Reported |  | Restatement Adjustments |  | Refer-ence |  | As Restated
Deferred tax assets | $ | — |  |  | $ | 3,006 |  |  | b |  | $ | 3,006 |  |  | $ | — |  |  | $ | 3,379 |  |  | b |  | $ | 3,379 |
Sales tax payable | — |  |  | 22,477 |  |  | a |  | 22,477 |  |  | — |  |  | 24,157 |  |  | a |  | 24,157 |
Accrued expenses and other current liabilities |  |  |  |  |  |  |  |  | 5,697 |  |  | (1,106) |  |  | a |  | 4,591 |
Deferred tax liabilities | 1,262 |  |  | (1,262) |  |  | b |  | — |  |  | 936 |  |  | (936) |  |  | b |  | — |
Retained earnings | 130,721 |  |  | (18,209) |  |  | a, b |  | 112,512 |  |  | 130,496 |  |  | (18,736) |  |  | a, b |  | 111,760 |
The following tables set forth the corrections in each of the individual line items affected in the condensed consolidated statements of cash flows for each respective period:
| Three Months Ended |  | Six Months Ended
| June 30, 2021 |  | September 30, 2021
| As Previously Reported |  | Restatement Adjustments |  | Refer-ence |  | As Restated |  | As Previously Reported |  | Restatement Adjustments |  | Refer-ence |  | As Restated
Net income | $ | 4,428 |  |  | $ | (849) |  |  | a, b |  | $ | 3,579 |  |  | $ | 10,777 |  |  | $ | (1,424) |  |  | a, b |  | $ | 9,353 |
Deferred income taxes | (167) |  |  | (186) |  |  | b |  | (353) |  |  | 346 |  |  | (335) |  |  | b |  | 11 |
Sales tax payable | — |  |  | 1,035 |  |  | a |  | 1,035 |  |  | — |  |  | 1,759 |  |  | a |  | 1,759 |
| Nine Months Ended |  | Twelve Months Ended
| December 31, 2021 |  | March 31, 2022
| As Previously Reported |  | Restatement Adjustments |  | Refer-ence |  | As Restated |  | As Previously Reported |  | Restatement Adjustments |  | Refer-ence |  | As Restated
Net income | $ | 15,034 |  |  | $ | (1,858) |  |  | a,b |  | $ | 13,176 |  |  | $ | 21,100 |  |  | $ | (2,384) |  |  | a, b |  | $ | 18,716 |
Deferred income taxes | (19) |  |  | (454) |  |  | b |  | (473) |  |  | (345) |  |  | (501) |  |  | b |  | (846) |
Sales tax payable | — |  |  | 2,312 |  |  | a |  | 2,312 |  |  | — |  |  | 2,928 |  |  | a |  | 2,928 |
Accrued expenses and other current liabilities |  |  |  |  |  |  |  |  | (50) |  |  | (43) |  |  | a |  | (93) |
Summary of Restatement - Consolidated Statements of Stockholders’ equity The following table sets forth the corrections in each of the line items affected in the consolidated statements of stockholders' equity and total equity for each respective period:
|  | As Previously Reported |  | Restatement Adjustments |  | As Restated
Retained Earnings, March 31, 2020 |  | 126,177 |  | (9,668) |  | 116,509
Dividends Declared |  | (22,639) |  | — |  | (22,639)
Net Income |  | 30,603 |  | (6,684) |  | 23,919
Retained Earnings, March 31, 2021 |  | 134,141 |  | (16,352) |  | 117,789
Dividends Declared |  | (24,745) |  | — |  | (24,745)
Net Income |  | 21,100 |  | (2,384) |  | 18,716
Retained Earnings, March 31, 2022 |  | 130,496 |  | (18,736) |  | 111,760
Dividends Declared |  | (25,241) |  | — |  | (25,241)
Net Income |  | 233 |  | 4,907 |  | 5,140
Retained Earnings, March 31, 2023 |  | 105,488 |  | (13,829) |  | 91,659
Total Shareholders' Equity, March 31, 2020 |  | 130,010 |  | (9,668) |  | 120,342
Total Shareholders' Equity, March 31, 2021 |  | 141,281 |  | (16,352) |  | 124,929
Total Shareholders' Equity, March 31, 2022 |  | 142,186 |  | (18,736) |  | 123,450
Total Shareholders' Equity, March 31, 2023 |  | 123,795 |  | (13,829) |  | 109,966

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- Definition The entire disclosure for reporting error correction. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 250 -SubTopic 10 -Section 50 -Paragraph 7 -URI https://asc.fasb.org/extlink&oid=124431687&loc=d3e22644-107794 + Details
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