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Liquidity and Management's Plans

3 Months Ended

Mar. 31, 2020

Liquidity And Managements Plans Abstract

3.	Liquidity and Management’s Plans

Through March 31, 2020, the Company had incurred an accumulated deficit since its inception of $21,442,277. At March 31, 2020, the Company had a cash balance of $1,047,197.

From the Company’s inception, it has generated revenues from (i) the sales and implementation of its internally generated software applications and (ii) other document management services, such as document conversion, storage, and retrieval. As part of its overall strategic plan to increase the Company’s revenues, improve liquidity, and move the Company towards profitability, the Company acquired Graphic Sciences on March 2, 2020, and CEO Image on April 21, 2020.

The Company’s business plan is to increase our sales and market share by developing a targeted marketing approach to select vertical markets, enhance our direct selling results, and continue to develop a network of select resellers through which we expect to sell our expanded document management solutions. We expect that this marketing initiative will require us to continue our efforts towards direct marketing campaigns and leads management, reseller on-boarding, and to develop additional software integration and customization capabilities, all of which may require additional capital. We also plan to continually monitor opportunities to make strategic acquisitions that will strengthen or complement our product and services offerings, bring more solutions to our customers, and increase revenues and liquidity.

The Company has recently implemented plans to increase liquidity, including the acquisitions of Graphic Sciences and CEO Image. Prior to these recent acquisitions, including in March of 2020, the Company has used proceeds from the issuance of equity, debt, and convertible notes to sustain operations, execute its business plan, and make strategic acquisitions. We also received a loan through the Paycheck Protection Program in April 2020 in the amount of $838,700. However, due to the effects of coronavirus (COVID-19), it is uncertain if the capital requirements to cover the Company’s operating costs through the next 12 months can be met from cash flows generated by operations. Due to our history of operating losses as well as general overall economic conditions, there is no assurance that the Company will be able to obtain additional capital or debt financing within that time. Given these conditions, the Company’s ability to continue as a going concern is contingent upon sufficiently enhancing its operating cash flow, successfully managing the transition of its recent acquisitions of Graphic Sciences and CEO Image, and successfully managing its cash requirements. We have taken steps to reduce operating expenses, including a temporary furlough and a reduction in management compensation. In addition, the Company’s ability to continue as a going concern must be considered in light of the problems, expenses and complications frequently encountered by the competitive environment in which the Company operates and its cash requirements. These factors, among others, raise substantial doubt about the Company’s ability to continue as a going concern.

Since inception, the Company’s operations have primarily been funded through a combination of gross profits, government-sponsored loans, and the sale of both equity and debt securities. Although management believes that the Company may have access to additional capital resources, there are currently no commitments or arrangements in effect that would provide for new financing and there is no assurance that the Company will be able to obtain sufficient additional funds on commercially acceptable terms, if at all.

The Company’s condensed consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might be necessary should it be unable to continue as a going concern.