Document and Entity Information
Document and Entity Information - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Apr. 30, 2020 | |
Cover [Abstract] | ||
Entity Registrant Name | RELIABILITY INC | |
Entity Central Index Key | 0000034285 | |
Document Type | 10-K | |
Document Period End Date | Dec. 31, 2019 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Well-known Seasoned Issuer | No | |
Entity Voluntary Filer | No | |
Entity Current Reporting Status | No | |
Entity Interactive Data Current | No | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business Flag | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Public Float | $ 78,500 | |
Entity Common Stock, Shares Outstanding | 300,000,000 | |
Document Fiscal Period Focus | FY | |
Document Fiscal Year Focus | 2019 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
CURRENT ASSETS | ||
Cash and cash equivalents | $ 275 | $ 29 |
Trade receivables, net of allowance for doubtful accounts | 7,029 | 5,865 |
Notes receivable from related parties | 3,418 | 3,315 |
Prepaid expenses and other current assets | 316 | 241 |
Total current assets | 11,038 | 9,450 |
Property, plant and equipment, net | 2,483 | 33 |
Other intangible assets, net | 237 | |
Goodwill | 518 | |
Total assets | 14,276 | 9,483 |
CURRENT LIABILITIES | ||
Factoring | 5,508 | 4,153 |
Current maturities of long-term debt | 794 | |
Accounts payable | 1,087 | 707 |
Accrued expenses | 548 | 458 |
Accrued payroll | 907 | 656 |
Deferred revenue | 347 | 235 |
Income taxes payable | 817 | 664 |
Note payable | 890 | |
Current portion of mortgage loan payable | 45 | |
Other current liabilities | 105 | |
Total current liabilities | 10,254 | 7,667 |
Mortgage loan payable, net of current portion | 1,745 | |
Deferred income taxes | 344 | |
Total liabilities | 11,999 | 8,011 |
Commitment and contingencies (Note 12) | ||
Subsequent events (Note 18) | ||
STOCKHOLDER'S EQUITY | ||
Common stock, without par value, 300,000,000 shares authorized, 300,000,000 issued and outstanding as of December 31, 2019, and 282,000,000 shares issued and outstanding as of December 31, 2018 | ||
Additional paid-in capital | 750 | |
Retained earnings | 1,840 | 1,472 |
Total stockholder's equity attributable to Reliability Inc. | 2,590 | 1,472 |
Noncontrolling interest in consolidated affiliates | (313) | |
Total equity | 2,277 | 1,472 |
Total liabilities and stockholder's equity | $ 14,276 | $ 9,483 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - shares | Dec. 31, 2019 | Dec. 31, 2018 |
Statement of Financial Position [Abstract] | ||
Common stock, shares authorized | 300,000,000 | 300,000,000 |
Common stock, shares issued | 300,000,000 | 282,000,000 |
Common stock, shares, outstanding | 300,000,000 | 282,000,000 |
Consolidated Statements of Inco
Consolidated Statements of Income - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Revenue earned | ||
Service revenue | $ 38,444 | $ 37,638 |
Cost of revenue | ||
Cost of revenue | 34,375 | 33,774 |
Gross profit | 4,069 | 3,864 |
Selling, general and administrative expenses | 2,985 | 2,807 |
Operating income | 1,084 | 1,057 |
Other income (expense) | ||
Interest income | 68 | 80 |
Interest expense | (438) | (328) |
Other expense | (206) | (241) |
Income before taxes on income | 508 | 568 |
Income tax benefit/(expense) | (156) | (182) |
Consolidated net income | 352 | 386 |
Less net income attributable to noncontrolling interest in consolidated affiliates | (157) | |
Net income attributable to Reliability Inc. | $ 195 | $ 386 |
Net income per share: | ||
Basic | $ 0 | $ 0 |
Diluted | $ 0 | $ 0 |
Share used in per share computation: | ||
Basic | 300,000,000 | 282,000,000 |
Diluted | 300,000,000 | 282,000,000 |
Consolidated Statements of Chan
Consolidated Statements of Change in Equity - USD ($) $ in Thousands | Common Stock [Member] | Additional Paid-in Capital [Member] | Retained Earnings [Member] | Total [Member] | Non - Controlling Interest in Consolidated Affiliates [Member] | Total |
Beginning balance at Dec. 31, 2017 | $ 1,086 | $ 1,086 | $ 1,086 | |||
Beginning balance, shares at Dec. 31, 2017 | 100 | |||||
Net income | 386 | 386 | 386 | |||
Recapitalization | ||||||
Recapitalization, shares | 281,999,900 | |||||
Ending balance at Dec. 31, 2018 | 1,472 | 1,472 | 1,472 | |||
Ending balance, shares at Dec. 31, 2018 | 282,000,000 | |||||
Net income | 352 | 352 | (157) | 195 | ||
Recapitalization | 16 | 16 | 16 | |||
Recapitalization, shares | 18,000,000 | |||||
Note receivable from shareholder for tax debt | 750 | 750 | 750 | |||
VIE consolidation | (156) | (156) | ||||
Ending balance at Dec. 31, 2019 | $ 750 | $ 1,840 | $ 2,590 | $ (313) | $ 2,277 | |
Ending balance, shares at Dec. 31, 2019 | 300,000,000 |
Statements of Cash Flows
Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Cash flows from operating activities: | ||
Net Income | $ 195 | $ 386 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 25 | 25 |
(Gain)/loss on disposal of property and equipment | 3 | (27) |
Deferred income taxes | (344) | (166) |
Accrued interest | (25) | |
Changes in operating assets and liabilities: | ||
Trade receivables | (548) | (1,133) |
Prepaid expenses and other current assets | (68) | (7) |
Accounts payable | 250 | 28 |
Accrued payroll | 238 | 87 |
Accrued expenses | (62) | 226 |
Deferred revenue | 112 | 216 |
Other liabilities | 72 | 76 |
Income taxes payable/tax paid | 153 | 305 |
Net cash provided by operating activities | 1 | 16 |
Cash flows from investing activities: | ||
Cash from merger | 2 | |
Purchase of fixed assets | (41) | 3 |
Net cash provided by (used in) investing activities | (39) | 3 |
Cash flows from financing activities: | ||
Net borrowing/(repayment) of line-of-credit+ | 916 | 846 |
Proceeds from issuing short-term debt | 850 | |
Net borrowing/(payment) of long-term debt | (794) | 865 |
Advances to related parties | (688) | (925) |
Net curtailment on long-term debt | (868) | |
Net cash provided by (used in) financing activities | 284 | (82) |
Net increase (decrease) in cash and cash equivalents | 246 | (63) |
Cash and cash equivalents, beginning of period | 29 | 92 |
Cash and cash equivalents, end of period | 275 | 29 |
Supplemental disclosures of cash flow information: | ||
Cash paid during the period for: Interest | 364 | 253 |
Cash paid during the period for: Income taxes | 389 | 83 |
Supplemental disclosures of non-cash financing activities: | ||
Net tangible assets acquired in acquisition of IQS | 623 | |
Net intangible assets acquired in acquisition of IQS | 758 | |
Liabilities assumed during acquisition of IQS | 735 | |
Reduction in notes receivable from related parties for acquisition of IQS | 646 | |
ASC 842 leases added to property, plant and equipment | 30 | |
Leases placed in other current liabilities | 30 | |
Non-cash impact of recapitalization from merger Liabilities assumed in merger | 7 | |
Conversion of shareholder loan to equity in merger | 162 | |
VIE net asset consolidated | 1,631 | |
VIE liabilities consolidated | 1,790 | |
VIE reduction in equity | $ 160 |
Nature of Operations
Nature of Operations | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
Nature of Operations | NOTE 1 - NATURE OF OPERATIONS Reliability, Inc. is a leading provider of employer of record and temporary media and information technology (“IT”) staffing services that operates, along with its wholly owned subsidiary, The Maslow Media, Inc., (collectively, “Reliability”), primarily within the United States of America in three industry segments: Employer of Record (EOR), Staffing and Video Production segment provides script to screen media talent. EOR which is a unique workforce management solution, represents 89.6% of the revenue. Our Staffing segment provides skilled field talent on a nationwide basis for IT and finance and accounting client partner projects. Our staffing includes revenue derived from permanent placement. Video Production involves assembling and providing crews for special projects that can last anywhere from a week to 6 months. On October 29, 2019, Maslow became a wholly owned subsidiary of Reliability via a reverse merger. |
Liquidity and Going Concern
Liquidity and Going Concern | 12 Months Ended |
Dec. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Liquidity and Going Concern | NOTE 2 - LIQUIDITY AND GOING CONCERN In December 2019, a novel strain of coronavirus was reported to have surfaced in Wuhan, China. In January 2020, this coronavirus spread to other countries, including the United States, and efforts to contain the spread of this coronavirus intensified. The outbreak and any preventative or protective actions that governments or we may take in respect of this coronavirus may result in a period of business disruption, reduced customer traffic and reduced operations. The Company expects that the impact of this coronavirus will be materially negative in the short term. The full financial impact cannot be reasonably estimated at this time but may materially affect our business, financial condition and results of operations . Even before the state and U.S. governments’ reaction to COVID-19 forced employees to work from their homes starting around March 12, 2020, the Company had begun to experience cash constraints due to the following factors: 1. Approximately $3,400 of outstanding debt owed to the Company has not been paid and is in default. 2. The utilization of cash used in financing Vivos affiliated activities of $688 in 2019. 3. The inability to access capital markets due to not having any available shares of common stock. 4. The inability to factor up to $400 in IQS invoices from January 26, 2020 through March 31, 2020, with $219 still not factored as of April 2, 2020. Executive management took swift action on March 16, 2020 by reducing hours employees who clients ceased utilizing due to COVID-19 virus concerns and office closures. Six (6) SG&A employees were subsequently furloughed as of March 20, 2020 and a temporary across the board reduction in pay was instituted across the remaining SG&A staff members with executives taking a 50% larger cut in salary. We also began having employees work from their homes making full use of our cloud-based infrastructure, and subsequently terminated the lease effective April 30, in Rockville which will save approximately $246 a year. Executive Management is prepared to take additional steps, if necessary, as the Company monitors its EOR and staffing hours closely. Additionally, the Company is pursuing Coronavirus Aid, Relief, and Economic Security (“CARES”) Act programs for which it is eligible including the Paycheck Protection Program, which would enable the Company to pay its employees, and the COVID-19 Economic Injury Disaster Loan. The Company is also looking into selling a portion of the Vivos notes that are overdue. All these conditions raise substantial doubt about the Company’s ability to continue as a going concern. There can be no assurances that the Company will be successful in managing the impact of the foregoing or its ability to maintain sufficient liquidity over a period of time that will allow it to continue as a going concern. The accompanying consolidated financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classifications of liability that may results from the possible inability of the Company to continue as a going concern. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The Company’s consolidated financial statements reflect the financial position and operating results of Reliability, Inc. including its wholly owned subsidiaries. All intercompany transactions and balances have been eliminated in consolidation. Fiscal Year The Company’s fiscal year is from January 1 st st Reclassification Certain amounts in the 2018 consolidated financial statements have been reclassified to conform to the 2019 presentation. Management Estimates The consolidated financial statements and related disclosures are prepared in conformity with United States (U.S.) generally accepted accounting principles (“GAAP”). The Company must make estimates and judgments that affect the amounts reported in the consolidated financial statements and accompanying notes. Estimates are used for, but not limited to revenue recognition, allowances for doubtful accounts, recoverability of notes receivable, useful lives for depreciation and amortization, loss contingencies, allocation of purchase price in connection with business combinations, valuation allowances for deferred income taxes, and the assumptions used for web site development cost classifications. Actual results may be materially different from those estimated. In making its estimates, the Company considers the current economic and legislative environment. Cash and Cash Equivalents The Company considers all highly liquid investments with an original maturity of 90-days or less to be cash equivalents. Concentration of Credit Risk For the year ended December 31, 2019, the Company’s top 10 clients generated over 82% of the revenue. A large portion of our business comes from two clients, AT&T Services, Inc. (inclusive of its DirecTV division) (“AT&T”) and Janssen Pharmaceuticals (which includes workforce partners Johnson & Johnson). AT&T accounted for 37% of revenue in 2019 and 2018. AT&T comprised of 50% and 38% of the accounts receivable balance as of December 31, 2019 and 2018, respectively. Janssen Pharmaceuticals (which includes workforce partners Johnson & Johnson) accounted for approximately 11% of our total revenues for the years ended December 31, 2019 and 2018. Janssen Pharmaceuticals comprised of 19% and 21% of accounts receivable as of December 31, 2019 and 2018, respectively. No other client exceeded 10% of revenues. Financial instruments, which potentially subject the Company to concentrations of credit risk, are primarily cash and accounts receivable. The Company performs continuing credit evaluations of its customers and does not require collateral. The Company has not experienced significant losses related to receivables. Accounts Receivable, Contract Assets, and Contract Liabilities (Deferred Revenue) Receivables represent both trade receivables from customers in relation to fees for the Company’s services and unpaid amounts for benefit services provided by third-party vendors, such as healthcare providers for which the Company records a receivable for funding until the payment is received from the customer and a corresponding customer obligations liability until the Company disburses the balances to the vendors. The Company provides for an allowance for doubtful accounts by specifically identifying accounts with a risk of collectability and providing an estimate of the loss exposure. Management considers all contract receivables as of December 31, 2019 and2018 to be fully collectible, therefore an allowance for doubtful accounts is not provided for. The Company records accounts receivable when its right to consideration becomes unconditional. Contract assets primarily relate to the Company rights to consideration for services provided that they are conditional on satisfaction of future performance obligations. The Company holds customer deposits of certain customers related to its EOR business to minimize cash flow impact and reduces risks of uncollectible trade receivables. The Company records contract liabilities (deferred revenue) when payments are made or due prior to the related performance obligations being satisfied. The current portion of the Company contract liabilities is included in accrued liabilities in its consolidated balance sheets. The Company does not have any material contract assets or long-term contract liabilities. At December 31, 2019 and 2018, the Company’s deferred revenue totaled $347 and $235 respectively. Fair Value Measurements The Company measures fair value based on the price that the Company would receive upon selling an asset or pay to transfer a liability in an orderly transaction between market participants at the measurement date. Various inputs are used in determining the fair value of assets or liabilities. Inputs are classified into a three-tier hierarchy, summarized as follows: ● Level 1 – Quoted prices in active markets for identical assets or liabilities; ● Level 2 – Quoted prices in active markets for similar assets and liabilities and inputs that are observable for the assets or liabilities; ● Level 3 – Significant unobservable inputs for the assets or liabilities. When Level 1 inputs are not available, the Company measures fair value using valuation techniques that maximize the use of relevant observable inputs (Level 2) and minimizes the use of unobservable inputs (Level 3).The carrying amounts reported as of December 31, 2019 and 2018 for cash and cash equivalents, trade receivables, prepaid expenses and other current assets, accounts payable and accrued expenses, factoring liability, notes and mortgages payable approximate their fair values due to the short-term nature of these instruments or are based on interest rates available to the Company that are comparable to current market rates. It is not practicable to estimate the fair value of the notes receivable from related parties due to their related party nature. Property and Equipment Property and equipment are stated at cost and are depreciated using primarily the straight-line method over the following estimated useful lives: furniture, fixtures, and computer equipment — three to seven years; leasehold improvements — over the shorter of the estimated useful life of asset or the lease term. The estimated useful life of buildings is thirty-nine years. Expenditures for renewals and betterments are capitalized whereas expenditures for repairs and maintenance are charged to income as incurred. Upon sale or disposition of property and equipment, the difference between the unamortized cost and the proceeds is recorded as either a gain or a loss. Depreciation expense for the years ended December 31, 2019 and 2018 totaled $22 and $25, respectively. Long-Lived Assets The Company reviews its long-lived assets, primarily fixed assets, intangible assets and goodwill, for impairment whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recovered. The Company looks primarily to the undiscounted future cash flows in its assessment of whether or not long-lived assets have been impaired. There were no impairments recorded during the years ended December 31, 2019 and 2018. Intangible Assets The Company holds intangible assets with finite lives. Intangible assets with finite useful lives are amortized over their respective estimated useful lives, ranging from three to ten years, based on a pattern in which the economic benefit of the respective intangible asset is realized. As of December 31, 2019, amortization expense was $3. Identifiable intangible assets recognized in conjunction with acquisitions are recorded at fair value. Significant unobservable inputs are used to determine the fair value of the identifiable intangible assets based on the income approach valuation model whereby the present worth and anticipated future benefits of the identifiable intangible assets were discounted back to their net present value. The Company evaluates the recoverability of intangible assets whenever events or changes in circumstances indicate that an intangible asset’s carrying amount may not be recoverable. The Company annually evaluates the remaining useful lives of all intangible assets to determine whether events and circumstances warrant a revision to the remaining period of amortization. The Company determined that there were no impairment indicators for these assets during the year ended December 31, 2019. Goodwill Goodwill represents the difference between the enterprise value/cash paid less the fair value of all recognized net asset fair values including identifiable intangible asset values in a business combination. The Company reviews goodwill for impairment annually during the fourth quarter or whenever events or changes in circumstances indicate the carrying value of goodwill may not be recoverable. Based on annual testing, the Company has determined that there was no goodwill impairment during the year ended December 31, 2019. The Company first evaluates qualitative factors to determine whether it is more likely than not (that is, a likelihood of more than 50 percent) that the fair value of the reporting unit is less than it’s carrying amount, including goodwill. If after qualitatively assessing the totality of events or circumstances, the Company determines that it is not more likely than not that the fair value of the reporting unit is less than it’s carrying amount, then further testing is unnecessary. If after assessing the totality of events or circumstances, the Company determines that it is more likely than not that the fair value of the reporting unit is less than its carrying amount, the Company then estimates the fair value of the reporting unit and compares the fair value of the reporting unit with its carrying amount, including goodwill, as discussed below. In assessing whether it is more likely than not that an indefinite-lived intangible asset is impaired, the Company assesses relevant events and circumstances that could affect the significant inputs used to determine the fair value. The quantitative impairment test for an indefinite-lived intangible asset consists of a comparison of the fair value of the asset with its carrying amount. If the carrying amount of an intangible asset exceeds its fair value, the Company shall recognize an impairment loss in an amount equal to that excess. The quantitative goodwill impairment test involves a two-step process. In the first step, the Company compares the fair value of each reporting unit to its carrying value. If the fair value of the reporting unit exceeds its carrying value, goodwill is not impaired, and no further testing is required. If the fair value of the reporting unit is less than the carrying value, The Company must perform the second step of the impairment test to measure the amount of impairment loss. In the second step, the reporting unit’s fair value is allocated to all of the assets and liabilities of the reporting unit, including any unrecognized intangible assets, in a hypothetical analysis that calculates the implied fair value of goodwill in the same manner as if the reporting unit was being acquired in a business combination. If the implied fair value of the reporting unit’s goodwill is less than the carrying value, the difference is recorded as an impairment loss. Revenue Recognition The Company adopted Financial Accounting Standards Board (“FASB”) Accounting Standards Updates (“ASU”) ASU 2014-09, Revenue from Contracts with Customers, The Company derives its revenues from three segments: EOR, Recruiting and Staffing, and Video and Multimedia Production. The Company provides temporary staffing and permanent placement services. Revenues are recognized when promised services are delivered to client, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those services. Revenues as presented on the consolidated statements of income represent services rendered to clients, less sales adjustments and allowances. Reimbursements, including those related to out-of-pocket expenses, are also included in revenues, and the related amounts of reimbursable expenses are included in cost of services. The Company records revenue on a gross basis as a principal versus on a net basis as an agent in the presentation of revenues and expenses. The Company has concluded that gross reporting is appropriate because the Company (i) has the risk of identifying and hiring qualified field talent, (ii) has the discretion to select the field talent and establish their price and duties and (iii) bears the risk for services that are not fully paid for by client. Temporary staffing revenues - Field talent revenues from contracts with clients are recognized in the amount to which the Company has a right to invoice, when the services are rendered by the Company’s field talent. Permanent placement staffing revenues - Permanent placement staffing revenues are recognized when employment candidates start their permanent employment. The Company estimates the effect of permanent placement candidates who do not remain with its client through the guarantee period (generally 90 days) based on historical experience. Allowances, recorded as a liability, are established to estimate these losses. Fees to client are generally calculated as a percentage of the new worker’s annual compensation. No fees for permanent placement services are charged to employment candidates. Refer to Note 16 for disaggregated revenues by segment. Payment terms in our contracts vary by the type and location of our client partner and the services offered. The term between invoicing and when payment is due is not significant. There were no unsatisfied performance obligations as of December 31, 2019. There were no revenues recognized during year ended December 31, 2018 related to performance obligations satisfied or partially satisfied in previous periods. There are no contract costs capitalized. The Company did not recognize any contract impairments during the year ended December 31, 2019. Advertising The Company recognizes advertising expense in selling, general and administrative expenses as the services are incurred. Total advertising expense for the year ended December 31, 2019 and 2018 was $43 and $36, respectively. Earnings Per Share Basic earnings per common share are computed by dividing net income by the weighted average number of common shares outstanding during the year. Diluted earnings per share reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock or resulted in the issuance of common stock that then shared in the earnings of the Company. Income Taxes The Company accounts for income taxes utilizing the asset and liability method. Under this method, deferred tax assets and liabilities are determined based on differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis, and net operating loss and tax credit carryforwards, using enacted tax rates and laws that are expected to be in effect when the differences reverse. A valuation allowance is recorded against deferred tax assets in these cases when management does not believe that the realization is more likely than not. While management believes that its judgements and estimates regarding deferred tax assets and liabilities are appropriate, significant differences in actual results may materially affect the Company’s future financial results. The Company recognizes any uncertain income tax positions at the largest amount that is more-likely-than-not to be sustained upon audit by the relevant taxing authority. An uncertain income tax position will not be recognized if it has less than a 50% likelihood of being sustained. The Company’s policy is to recognize interest and/or penalties related to income tax matters in income tax expense. As of December 31, 2019, and 2018, the Company did not record any accruals for interest and penalties. The Company does not foresee material changes to its uncertain tax positions within the next twelve months. The Company’s tax years are subject to examination for 2016 and forward for U.S. Federal tax purposes and for 2015 and forward for state tax purposes. Recently Issued Accounting Pronouncements In January 2017, the FASB issued an updated guidance simplifying the subsequent measurement of goodwill by eliminating “Step 2” from the goodwill impairment test. The updated guidance is effective for public companies’ annual or interim goodwill impairment tests in fiscal years beginning after December 15, 2019. Early adoption is permitted for annual or interim goodwill impairment tests performed on testing dates after January 1, 2017. The new standard is effective for Reliability for the year ending December 31, 2019. The Company adopted this standard during the year ended December 31, 2019 and the adoption was not material to the Company’s consolidated financial statements. In February 2016, the FASB issued ASU No. 2016-02 (Topic 842) “ Leases Leases In August 2018, the FASB issued new guidance on disclosures related to fair value measurements. The guidance is intended to improve the effectiveness of the notes to financial statements by facilitating clearer communication, and it includes multiple new, eliminated and modified disclosure requirements. The guidance was effective for the Company as of January 1, 2020. The adoption of this guidance is not expected to have a material impact on the Company’s consolidated financial statements. In August 2018, the FASB issued ASU No. 2018-15 Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract. In August 2018, the FASB issued new guidance on the accounting for internal-use software. The guidance aligns the accounting for costs incurred to implement a cloud computing arrangement that is a service arrangement with the guidance on capitalizing costs associated with developing or obtaining internal-use software. The guidance was effective for the Company as of January 1, 2020. The adoption of this guidance is not expected to have a material impact on the Company’s consolidated financial statements. In December 2019, the FASB issued new guidance on income taxes. The guidance removes certain exceptions to the general income tax accounting principles and clarifies and amends existing guidance to facilitate consistent application of the accounting principles. The new guidance is effective for us as of January 1, 2021. The Company is assessing the impact of the adoption of this guidance on its consolidated financial statements. The Company does not believe any other recently issued but not yet effective accounting pronouncement, if adopted, would have a material effect on its present or future consolidated financial statements. |
Acquisition
Acquisition | 12 Months Ended |
Dec. 31, 2019 | |
Business Combinations [Abstract] | |
Acquisition | NOTE 4 - ACQUISITION Intelligent Quality Solutions (“IQS”) On December 1, 2019, the Company acquired the customer contracts and trade receivables and assumed certain liabilities of Intelligent Quality Solutions, Inc. IQS in exchange for a reduction of approximately $691 of the notes receivable from relates parties (Vivos). The assets acquired in the IQS asset purchase agreement were acquired by Maslow. The acquisition of IQS allows the Company to strengthen and expand its IT operations throughout the Midwest U.S. region and expand to markets across the country with talent and software quality assurance services. The consolidated statement of income for the year ended December 31, 2019 includes one month of IQS operations, which was approximately $245 of revenue and $6 of net operating loss. The purchase price has been allocated to the assets acquired and liabilities assumed as of the date of acquisition. All amounts recorded to goodwill are expected to be deductible for tax purposes. The allocation is as follows: 2019 Accounts receivable $ 529 Prepaid expenses and other assets 119 Intangible assets 240 Goodwill 451 Liabilities assumed 759 Total net assets acquired $ 580 Cash $ 44 Working capital adjustment 67 Total fair value of consideration transferred for acquired business $ 691 The allocation of the intangible assets is as follows: Estimated Fair Value Estimated Customer relationships $ 41 3 years Trade name 199 10 years Total $ 240 The Company incurred costs of $6 related to the IQS acquisition. These costs were expensed as incurred in selling, general and administrative expenses in 2019. The following unaudited pro forma financial information includes the results of operations of the Company and is presented as if IQS had been acquired as of January 1, 2018. The unaudited pro forma information has been provided for illustrative purposes only. The unaudited proforma information does not purport to be indicative of the actual results that would have been achieved by the combined companies for the periods presented, or the results that may be achieved by the combined companies in the future. Future results may vary significantly from the results reflected in the following unaudited pro forma financial information because of future events and transactions, as well as other factors, many of which are beyond the control of the Company. Net profit was calculated using an assumed blended tax rate of approximately 28%. Proforma (Unaudited) 2019 2018 Revenues $ 41,441 $ 40,980 Operating income $ 1,218 $ 1,408 Net Profit $ 248 $ 704 |
Trade Receivables
Trade Receivables | 12 Months Ended |
Dec. 31, 2019 | |
Receivables [Abstract] | |
Trade Receivables | NOTE 5 – TRADE RECEIVABLES Contract receivables consist of the following as of: 2019 2018 Billed Receivables $ 1,312 $ 1,573 Unbilled Receivables 209 139 Accounts receivable, factored 5,508 4,153 $ 7,029 $ 5,865 All of the net trade receivables are pledged as collateral on a loan agreement. |
Property, Plant and Equipment
Property, Plant and Equipment | 12 Months Ended |
Dec. 31, 2019 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment | NOTE 6 – PROPERTY, PLANT AND EQUIPMENT Property, plant and equipment as of December 31, 2019 and 2018 consists of the following: 2019 2018 Building $ 1,856 $ - Land 510 - Office equipment 248 43 Computer software 61 41 Leasehold improvements 6 6 Operating lease asset 18 - 2,699 90 Accumulated depreciation (216 ) (57 ) Property, plant and equipment, net $ 2,483 $ 33 The Company evaluated its potential variable interest entities and determined it is subject to consolidation. See Note 11 for the impact as of December 31, 2019. |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 12 Months Ended |
Dec. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Other Intangible Assets | NOTE 7 – GOODWILL AND OTHER INTANGIBLE ASSETS The Company acquired intangible assets as part of the IQS acquisition during the year ended December 31, 2019 as discussed in Note 4. The Company recorded $518 of goodwill from this acquisition. Information regarding purchased intangible assets as of December 31, 2019 is as follows: Gross Value Accumulated Amortization Net Carrying Value Trade name $ 199 $ 2 $ 197 Customer relationships 41 1 40 Total $ 240 $ 3 $ 237 Trade name and customer relationships are amortized over 10 and 3 years, respectively. Amortization expense relating to purchased intangible assets was $3, and $0 for the year ended December 31, 2019 and 2018, respectively. Estimated future amortization expense for the next five years and thereafter is as follows: Years Ending December 31: 2020 $ 34 2021 34 2022 32 2023 20 2024 20 Thereafter 97 Total $ 237 |
Accrued Expenses
Accrued Expenses | 12 Months Ended |
Dec. 31, 2019 | |
Payables and Accruals [Abstract] | |
Accrued Expenses | NOTE 8 - ACCRUED EXPENSES Accrued expenses consist of the following as follows: December 31, 2019 2018 Accrued vendor costs $ 229 144 Financed insurance payable 258 252 Other 61 62 Accrued expenses $ 548 $ 458 |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | NOTE 9 - INCOME TAXES Income tax expense for the years ended December 31, 2019 and 2018 are comprised of the following: 2019 2018 Current federal income tax $ 246 $ 239 Current state income tax 254 99 Deferred income tax (benefit) (344 ) (156 ) Income tax expense $ 156 182 Significant components of the Company’s deferred income tax assets (liabilities) are as follows at: December 31 2019 2018 Deferred tax assets (liabilities): Employee accruals $ 74 $ - Cash to accrual (31 ) (335 ) Accrued workers’ compensation/Other 33 - State deduction 7 - Acquisition fees 14 - Deferred tax liabilities: Intangibles - - Fixed assets (13 ) (9 ) Deferred income taxes, net 85 (344 ) Valuation allowance (85 ) - Deferred tax assets (liabilities) $ - $ (344 ) The income tax provision, reconciled to the tax computed at the statutory federal rate, is as follows: December 31 2019 2018 Tax expense at federal statutory rate $ 74 21.0 % $ 119 21.0 % State income taxes, net 20 5.7 % 32 5.7 % Meals & Entertainment 2 0.7 % 7 1.2 % Penalties 5 1.3 % 11 1.9 % Nondeductible acquisition costs 16 4.6 % - 0 % Valuation allowance 85 - Other, net (46 ) 13.3 % 1 3 2.3 % Income tax expense $ 156 21.3 % $ 182 32.5 % |
Debt
Debt | 12 Months Ended |
Dec. 31, 2019 | |
Debt Disclosure [Abstract] | |
Debt | NOTE 10 - DEBT Convertible Debt The Company has notes payable in the amount of $890 pursuant to a convertible debt offering that commenced June 13, 2019. The offering was conducted pursuant to Section 4(a)(2) of the Securities Act of 1933, as amended, and the rules promulgated thereunder. Pursuant to this agreement, the Company issued to this individual a warrant for 0.5 shares of Company Common Stock and a convertible promissory note of same date in the initial principal amount of $50, in exchange for $50. The note bears interest at 12% per year. The balance is due and payable within 1 year from the issuance date unless earlier converted into shares of Company Common Stock upon the issuance by Reliability of Company Common Stock for gross proceeds of at least $5,000. Warrants can only be redeemable if the proceeds of $5,000 are secured. (See Liquidity and Capital Resources and Related Party Relationships) Tax Liabilities When the Maslow Media Group was initially acquired by Vivos Holdings, LLC in December 2016, Reliability’s corporate status was changed from an S Corp to a C Corp due to its new ownership structure. This triggered an accelerated tax event, a $215 estimated annual impact per year for 4 years, that Reliability is working with the IRS to pay off. As of December 31, 2019, the tax liability was $817 and was $664 was of December 31, 2018. Factoring Facilities Triumph Business Capital On November 4, 2016, the Company entered into a factoring and security agreement with Triumph Business Capital (“Triumph”). Pursuant to the agreement, the Company received advances on its accounts receivable (i.e. invoices) through Triumph to fund growth and operations. The proceeds of this agreement were used to pay operating costs of the business which include employee salaries, vendor payments and overhead expenses. On January 5, 2018, the agreement was amended to lower the factoring fee and interest rate for a term of one year. The agreement was amended again on January 19, 2018, to increase the maximum advance rate to $5,500. In January 2020, a new agreement was negotiated with Triumph lowering advance rate from 18 basis points to 15 and the interest rate from prime plus 2.5% to prime plus 2%. The amount of an invoice eligible for sale to Triumph went from 90% to 93%. The agreement which previously renewed annually, is now month to month. The Company continues to be obligated to meet certain financial covenants in respect to invoicing and reserve account balance. In accordance with the agreement, a reserve amount is required for the total unpaid balance of all purchased accounts multiplied by a percentage equal to the difference between one hundred percent and the advanced rate percentage. As of December 31, 2019, the required amount was 10%. Any excess of the reserve amount is paid to the Company on a weekly basis, as requested. If a reserve shortfall exists for a period of ten-days, the Company is required to make payment to the financial institution for the shortage. Accounts receivable were sold with full recourse. Proceeds from the sale of receivables were $29,367 and $30,458 for the years ended December 31, 2019 and 2018, respectively. The total outstanding balance under the recourse contract was $5,030 and $4,153 as of December 31, 2019 and 2018, respectively. The Factoring Facilities are collateralized by substantially all the assets of the Company. In the event of a default, the Factor may demand that the Company repurchase the receivable or debit the reserve account. Total finance line fees for the years ended December 31, 2019 totaled $65. Wilco Capital Management In order to be able to factor IQS invoices after the IQS asset acquisition as discussed in Note 4, the Company took on a factoring relationship with Wilco Capital Management (formerly known as First Avenue Funding, LLC) (“Wilco”). The original agreement was signed on January 7, 2019 with a minimum monthly volume of $125 with a maximum advance of $500 for a term of one year. The advanced rate is 90% of eligible accounts receivable (as defined by the agreement) and a finance rate of 1.275% per month and adjusted with any increase to the prime rate. As of December 31, 2019, the outstanding balance was $479. This relationship ended on March 31, 2020, when Triumph bought out this factoring relationship. |
Variable Interest Entity (VIE)
Variable Interest Entity (VIE) | 12 Months Ended |
Dec. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Variable Interest Entity (VIE) | NOTE 11 – VARIABLE INTEREST ENTITY (VIE) In December 2019, the Company’s executive management learned that prior to the Merger, in January 2017, one of the Company’s majority shareholders, on behalf of Maslow, executed a guarantee of obligations of Vivos Real Estate Holdings, LLC (“VREH”), under a mortgage loan for the purchase of the property at 22 Baltimore Rd., Rockville, Maryland. Maslow leases this space on market terms. This obligation had not been included in Maslow’s financial statements and were not separately disclosed prior to the Merger. U.S. GAAP requires the Company to assess whether VREH is a variable interest entity (“VIE”) because Maslow (i) share common shareholders who may or may not have significant influence or control, (ii) is a guarantor of the mortgage loan, (iii) is the sole lessee under a lease where the landlord is an affiliate of the Company, and (iv) has no other business in VREH. A VIE is a legal business structure (such as a corporation, partnership, or trust) that: ● does not provide equity investors with voting rights; or ● the equity investors do not have sufficient financial resources to meet the ongoing operating needs of the business. This is referred to as a thinly capitalized structure. Although the Company has neither any decision-making authority over VREH, nor financial interest in the operations of VREH, the Company is required to consolidate its financial statements with those of VREH for the reasons mentioned above, as it is considered the primary beneficiary of the VIE. Due to a lack of cooperation from VREH, the Company has not been able to acquire financial information about this entity for consolidation purposes prior to 2019. As a result, the Company has consolidated this entity for 2019. The assets and liability of the consolidated VIE are comprised of the following: 2019 Building $ 1,856 Office equipment 185 Land 510 Accumulated depreciation 148 Liabilities assumed 1,790 Total net assets consolidated $ 613 In addition, the related party note receivable with the VIE of $772 was eliminated. The potential financial exposure to loss as a guarantor could equal all the book value of the related party mortgage loan payable, a total of approximately $1,790 as of December 31, 2019, with $45 due within the next year. To date, the Company has not been called on for any loan repayment guarantee. The Company terminated the lease of the property at 22 Baltimore Road effective April 30, 2020. As a result, VREH will be considered a VIE for only four months of the 2020 fiscal year. As a result of the consolidation, the notes receivable held between Maslow and VREH was eliminated in consolidation. See Note 14 for details on the related party notes receivable. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | NOTE 12 – COMMITMENTS AND CONTINGENCIES The Company is engaged from time to time in legal matters and proceedings arising out of its normal course of business. The Company establishes a liability related to its legal proceedings and claims when it has determined that it is probable that the Company has incurred a liability and the related amount can be reasonably estimated. If the Company determines that an obligation is reasonably possible, the Company will, if material, disclose the nature of the loss contingency and the estimated range of possible loss, or include a statement that no estimate of the loss can be made. On or about February 17, 2020, the Company, as plaintiff, filed a complaint with the Circuit Court of Montgomery County, Maryland against Vivos Holdings, LLC, Vivos Real Estate Holdings, LLC and Naveen Doki, to enforce Maslow’s rights under certain promissory notes and a personal guarantee made by the defendants. The case is proceeding. The Company believes that it will be granted a judgment in its favor. Maslow intends to continue to vigorously prosecute this litigation. On February 28, 2020, On Healthcare Resource Network, LLC filed a complaint against Maslow in the Circuit Court of Montgomery County, Maryland. The plaintiff has not specified any alleged damage caused by Maslow and the Company believes any claims are without merit. The Company will defend itself from this case. On September 28, 2018, Credit Cash filed a complaint against Maslow, Vivos, Vivos Acquisitions, LLC, Dr. Doki, Dr. Valleru (the “Parties”) and other defendants in the United States District Court for the District of New Jersey for, among other things, breach of contract of the Maslow and HRCN Credit Facilities and their respective guaranties in relation to the November 15, 2017 agreement (the “DNJ Action”). On October 30, 2018, Credit Cash filed a motion to intervene in an action pending in New York State, Monroe County, filed by HCRN and LE Finance, LLC against the Parties and other defendants (“NY State Action”). On December 10, 2018, the Parties entered into a settlement agreement for the purpose of settling certain claims related to the DNJ Action only. Pursuant to the settlement agreement, certain repayment terms were agreed upon between Credit Cash and the Parties, but Credit Cash did not relinquish the right to pursue any claims related to the NY State Action, nor to pursue any remedies against any of the parties in relation to the November 15, 2017 agreement. Agreement for the Contingent Liquidation of the Common Stock of Maslow Media Group, Inc., dated as of October 28, 2019 (the “Liquidation Agreement”) permitting Maslow to liquidate up to the full amount of Maslow equity held by such persons in order to satisfy the obligations under the Settlement Agreements. On October 9, 2018, Maslow Media Group, Inc. was named as a defendant in an Affidavit of Confession of Judgment filed in the Supreme Court of the State of New York in relation to a case brought by Hop Capital, which the defendants collectively agree to pay a sum of $400 to Hop Capital. Maslow Media Group, Inc. is named as one defendant among six other defendants, all of which are entities related to Vivos. The claim brought by Hop Capital against the defendants in this case is in relation to a Merchant Agreement dated October 4, 2018; an agreement to which Maslow Media Group, Inc. was not a party. As such, Maslow Media Group, Inc. contends that being named in the Affidavit of Confession of Judgment as a defendant was made in error and is currently seeking to have its name removed from Affidavit of Confession of Judgment as a defendant. The Company will defend itself from this case. |
Equity
Equity | 12 Months Ended |
Dec. 31, 2019 | |
Equity [Abstract] | |
Equity | NOTE 13 - EQUITY The Company’s authorized capital stock consists of 300,000,000 shares of common stock, with no par value. All authorized shares of Company Common Stock are issued and outstanding. |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2019 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | NOTE 14 - RELATED PARTY TRANSACTIONS Stock Purchase Agreement On November 9, 2016, Vivos Holdings LLC ( “ ” Maslow Media Group Management Fees In connection with the transaction described in above, the Company was required to pay management fees to Vivos. Payments commenced on March 1, 2017 and were payable monthly in the amount of $20. In 2018, the Company offset management fees payable against accrued interest income on the related party receivable from Vivos. Effective on January 1, 2019, management fees paid to Vivos were suspended. Total management fees for the years ending December 31, 2019 and 2018 were $0 and $260, respectively. Notes Receivable The Company has notes receivable from Vivos and VREH, a member of Vivos, both related party affiliates. In connection with the stock purchase agreement noted above, on November 15, 2016, the Company executed a promissory note receivable with Vivos in the amount of $1,400. As defined by the agreement, the loan consists of two periods, whereby the first period from November 15, 2016 until September 30, 2018, no principal or interest payments were required. Interest will accrue monthly and a new loan in the amount of $1,773 will be subject to a second loan period. During the second loan period, interest shall be paid in twenty equal consecutive payments, quarterly. Principal plus any unpaid interest is due September 20, 2023. Interest during both loan periods accrues at a rate of 2.5%. Additionally, monthly payments of $15 are made on behalf of Vivos to the seller by the Company. These payments, plus any other payments made by the Company on behalf of Vivos, are added to the principal balance of the promissory note receivable. In 2018, all quarterly interest payments to be made in phase 2 were offset by the management fees due to Vivos. As of December 31,2019 and 2018, the total outstanding balances were $2,666 and $2,569, which includes accrued interest receivable of $162 and $94, respectively. On June 12, 2019, Maslow entered into a Personal Guaranty agreement with Dr. Doki, pursuant to which Dr. Naveen Doki personally guaranteed to Maslow repayment of $3,000 of the balance of the Promissory Note issued to Vivos on November 15, 2017 within the 2019 calendar year via cash, stock, or other business assets acceptable to the Company. Dr. Doki is a 5% or greater beneficial holder of Company Common Stock, and therefore is a related party. As of February 2020, the Company filed a lawsuit against the majority stockholder, pursuant to the personal guaranty agreement for defaulting on the outstanding notes receivables. On November 15, 2017, the Company executed an intercompany promissory note receivable with VREH in the amount of $772. As defined by the agreement, the loan consists of two periods, whereby the first period from November 15, 2017 until March 31, 2018, no principal or interest payments are required. During the first loan period, interest accrued monthly and a new loan amount of $781 will be subject to a second loan period. During the second period, interest is payable in 20 equal consecutive installments and the principal balance plus accrued and unpaid interest is due March 31, 2023. Interest during both periods accrues at a rate of 3.5% annually. In 2018, all quarterly interest payments to be made in Phase 2 were offset by the management fees due to Vivos. In addition, principal payments totaling $30 were made by Vivos. As of December 31, 2019, and 2018, the total outstanding balance was $772 and $746, respectively. This December 31, 2019 balance was eliminated during consolidation of the VIE. See Note 11. On September 5, 2019, Maslow entered into a Secured Promissory Note agreement with Vivos, pursuant to which Maslow issued a secured promissory note to Vivos in the principal amount of $750. The note bears interest at 2.5% per year and requires Vivos to make monthly payments to Maslow of $10 beginning December 1, 2019, with balance due and payable on November 1, 2026. Upon an event of default, which occurs upon failure of Vivos to make any monthly payment due under the terms of the note, Maslow has the right to declare the entire unpaid balance of the note due and payable. The note is secured by 30,000,000 shares of Company Common Stock, which is due and payable upon a default by Vivos, which occurs upon failure of Vivos to make any monthly payment due under the terms of the note. In addition, both Naveen Doki and Silvija Valleru personally guaranty the repayment of the note by Vivos. Naveen Doki and Silvija Valleru are beneficial owners of Vivos and are also 5% or greater beneficial owners of Company Common Stock. As of December 31, 2019, the total outstanding balance was $752, which includes interest of $2. Debt Settlement Agreements On July 10, 2018, Vivos executed a receivable financing agreement with a financial institution and agreed to remit $670 of accounts receivable over a six-month period through daily remittances of $5 in exchange for $485. The agreement is guaranteed by Vivos, both shareholders and Maslow. In October 2018, Vivos defaulted on the agreement and on October 25, 2018, executed a settlement agreement whereby the Maslow is to pay the outstanding balance over eleven installments with the final amount due August 31, 2019. The total outstanding balance as of December 31, 2018 was $212. As of December 31, 2019, there was no outstanding balance due. On July 5, 2018, Vivos executed a receivable financing agreement with a financial institution whereby Vivos agreed to remit $556 of accounts receivable over a six-month period through daily remittances of $4 in exchange for $400. The agreement is guaranteed by the Vivos, both majority shareholders and the Company. In October of 2018, Vivos defaulted on the agreement and on January 24, 2019, executed a settlement agreement whereby the Company is to pay the outstanding balance over eight installments with the final amount due August 31, 2019. On July 10, 2018, the Company (as a “merchant”) and Vivos (as a “owner/guarantor”) entered into a receivable financing agreement with Kinetic Direct Funding LLC pursuant to which the Company and Vivos agreed to remit $670 of the Company’s accounts receivable over a six-month period through daily remittances of $5 in exchange for $485 (the “Kinetic Financing Agreement”). The agreement is guaranteed by Vivos as well as Naveen Doki in his individual capacity, and an owner of Vivos. In October of 2018, there was a default under the Kinetic Financing Agreement by Vivos. On October 25, 2018, the Company, Naveen Doki, Silvija Valleru, and Vivos (among other entities) entered into a settlement agreement with Kinetic Direct Funders LLC in relation to default of the Kinetic Financing Agreement whereby the Company is to pay the outstanding balance over eleven installments with the final amount due August 31, 2019. On April 10, 2019, the settlement agreement was amended extending the remaining payment term to July 15, 2020. The Company has a binding and enforceable agreement with certain shareholders permitting the Company to liquidate up to the full amount of the Company’s equity held by such shareholders in order to satisfy the shareholders’ obligations under the Settlement Agreements. The total outstanding balance owed by the Company as of December 31, 2018 was $231. As of October 31, 2019, the Company has paid its portion of the outstanding balance due under the settlement agreement in full. On August 10, 2017, Vivos executed a receivable advance agreement with Argus Capital Funding. The Company received a net advance of $487 in exchange for $705 of the Company’s accounts receivable. Included in this loan is a fee of $218. The agreement was refinanced on November 15, 2017, when Vivos, and Vivos Acquisitions, LLC, via Dr. Naveen Doki and Dr. Silvija Valleru entered into an agreement with CC Business Solutions, a division of Credit Cash NJ, LLC (“Credit Cash”) pursuant to which Credit Cash advanced to the Company $600 in exchange for $780 of the Company’s accounts receivable, to be repaid fully by approximately May 20, 2019 (the “Maslow Credit Facility”). In addition, pursuant to the same agreement, Credit Cash advanced to Healthcare Resource Network, a company owned by Vivos (“HCRN”) a credit facility in the principal amount of $1,005 (“HCRN Credit Facility”). Each of Maslow, Vivos, Vivos Acquisitions, LLC, Dr. Naveen Doki and Dr. Silvija Valleru guaranteed the HCRN Credit Facility. To secure repayment of their guarantee obligations, the Company and Vivos granted to Credit Cash a security interest in all their assets. On September 14, 2018, the Company defaulted on the Maslow Credit Facility. In addition, on same date, the HCRN Credit Facility went into default. As a result, repayment on both facilities was accelerated, with the full balance for each becoming immediately due and payable. On December 10, 2018, the Company, Vivos, Vivos Acquisitions, LLC, Dr. Doki, and Dr. Valleru and Credit Cash entered into a settlement agreement in connection the November 15, 2017 agreement to govern the terms of the repayment of the HCRN Credit Facility and Maslow Credit Facility. Pursuant to the settlement agreement, the Company agreed to pay $10 per week until the entire balance of the Maslow Credit Facility was paid off. Pursuant to a subsequent agreement dated May 17, 2019 not involving the Company, Vivos and Vivos Acquisitions, LLC agreed to fully repay the HCRN Credit Facility via quarterly payments beginning June 30, 2019. The HCRN Credit Facility is still being repaid by Vivos, and as of October 29, 2019, has an outstanding balance of approximately $635. The Company has a binding and enforceable agreement with certain shareholders permitting Maslow to liquidate up to the full amount of Maslow equity held by such shareholders in order to satisfy the shareholders’ obligations under the Settlement Agreements. The total outstanding balance owed by the Company as of December 31, 2018 was $351. As of December 31, 2019, the Company has repaid the outstanding balance due for the Maslow Credit Facility under the settlement agreement in full. Related Party Relationships On October 29, 2019 prior to the Merger, pursuant to the Merger Agreement, Naveen Doki and Silvija Valleru became beneficial owners of 207,384,793 and 51,844,970 shares of RLBY Common Stock, respectively, equal to 69.13% and 17.13% of the total number of shares of RLBY Common Stock outstanding after giving effect to the Merger, respectively. On June 27, 2019 prior to the Merger, Maslow entered into a Securities Purchase Agreement with Hawkeye Enterprises, Inc., a company owned and controlled by Mark Speck, an officer and director of the Company. Pursuant to this agreement, Maslow issued to Hawkeye Enterprises 16,323 (on a post-Merger basis) shares of Company Common Stock, a warrant (as defined below) for 81,616 (on a post-Merger basis) shares of Company Common Stock and a convertible promissory note of same date in the initial principal amount of $50, in exchange for $50. The note bears interest at 12% per year, with balance due and payable on June 27, 2020. As of December 31, 2019, the amount under this agreement totaled to $53. On July 31, 2019 prior to the Merger, the Company entered into a Securities Purchase Agreement with the same officer and director discussed above. Pursuant to this agreement, the Company issued to this individual a Warrant for 81,616 (on a post-Merger basis) shares of Company Common Stock and a convertible promissory note of same date in the initial principal amount of $50, in exchange for $50. The note bears interest at 12% per year, with balance due and payable on July 31, 2020. As of December 31, 2019, the amount under this agreement totaled to $53. On July 31, 2019 prior to the Merger, the Company entered into a Securities Purchase Agreement with Nick Tsahalis, an executive officer and director of the Company. Pursuant to this agreement, the Company issued to this individual 32,646 (on a post-Merger basis) shares of RLBY Common Stock, and a Warrant to purchase 16,323 (on a post-Merger basis) shares of the RLBY Common Stock, and a Convertible Promissory Note of same date in the initial principal amount of $100, in exchange for $100. The note bears interest at 12% per year, with balance due and payable on July 31, 2020. As of December 31, 2019, the amount totaled to $105. On September 18, 2019, in anticipation of the closing of the Merger and intending that it be assumed by Maslow after the closing of the Merger, Hawkeye entered into a letter of intent (the “LOI”) regarding the potential acquisition of a complementary business. Maslow was then prohibited from entering into the LOI directly. In connection with the LOI, Hawkeye paid a non-refundable deposit of $75 with the understanding that after the closing of the Merger, the LOI would be assigned to the Company and the Company would reimburse Hawkeye for the deposit. On October 17, 2019, Hawkeye assigned, and Maslow agreed to assume the LOI and reimbursed Hawkeye for the deposit. The term “warrant” herein refers to warrants issued by Maslow and assumed by RLBY as a result of the Merger. The terms of all Warrants are the same other than as to the number of shares covered thereby. The Warrant may be exercised at any time or from time to time during the period commencing at 10:00 a.m. Eastern time on first business day following the completion of the Qualified Financing (as defined below) and expiring at 5:00 p.m. Eastern time on the fifth annual anniversary thereof (the “Exercise Period”). For purposes herein, a “Qualified Financing” means the issuance by the Company, other than certain excluded issuances of shares of Common Stock, in one transaction or series of related transactions, which transaction(s) result in aggregate gross proceeds actually received by the Company of at least $5,000. The exercise price per full share of RLBY Common Stock shall be 120% of the average sale price of the RLBY Common Stock across all transactions constituting a part of the Qualified Financing, with equitable adjustments being made for any splits, combinations or dividends relating to the RLBY Common Stock, or combinations, recapitalization, reclassifications, extraordinary distributions and similar events, that occur following one transaction constituting a part of the Qualified Financing and prior to one or more other transactions constituting a part of the Qualified Financing (the “Exercise Price”). Convertible note warrants were not valued and included as liability on balance sheet because of uncertainty around their pricing, value and low probability at this juncture in receiving the $5,000 trigger. On December 1, 2019, the Company acquired assets of IQS from Vivos Holdings Inc. as described in Note 4 above. |
Employee Benefit Plan
Employee Benefit Plan | 12 Months Ended |
Dec. 31, 2019 | |
Retirement Benefits [Abstract] | |
Employee Benefit Plan | NOTE 15 - EMPLOYEE BENEFIT PLAN The Company provides a defined contribution plan (the “401(k) Plan”) for the benefit of its eligible full-time employees. The 401(k) Plan allows employees to make contributions subject to applicable statutory limitations. The Company currently does not match employee contributions. |
Business Segments
Business Segments | 12 Months Ended |
Dec. 31, 2019 | |
Segment Reporting [Abstract] | |
Business Segments | NOTE 16 - BUSINESS SEGMENTS The Company operates within three industry segments: EOR, Recruiting and Staffing, and Video and Multimedia Production. The EOR segment provides media field talent to a host of large corporate customers in all 50 states. The Recruiting and Staffing segment provides skilled media and IT field talent on a nationwide basis for customers in a myriad of industries. The Video and Multimedia Production segment provides Script to Screen services for corporate, government and non-profit clients, globally. Segment operating income includes revenue and cost of services only. Currently, the Company is not allocating sales, general and administrative costs at the segment level. The following table provides a reconciliation of revenue and operating income by reportable segment to consolidated results for the periods indicated: December 31 2019 2018 Revenue: EOR $ 34,452 $ 34,573 Recruiting and Staffing 2,190 1,739 Video and Multimedia Production 1,641 1,228 Other 161 98 Total $ 38,444 $ 37,638 |
Mortgage Loan on Real Estate
Mortgage Loan on Real Estate | 12 Months Ended |
Dec. 31, 2019 | |
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Abstract] | |
Mortgage Loan on Real Estate | NOTE 17 – MORTGAGE LOAN ON REAL ESTATE As described in Note 11, VREH executed a mortgage loan for the purchase of the property at 22 Baltimore Rd., Rockville, Maryland with the Company as a guarantor of this loan on January 22, 2018. The loan was in the amount of $1,875 with an interest rate of 4.5% annually for the first 60 months of the loan and changes to 5.25% annually on January 28, 2023 for 59 months. The monthly payments during repayment period is $11 with a lump sum payment of $1,393 on December 28 th The mortgage loan as of December 31, 2019 is as follows: 2019 Mortgage Loan $ 1,790 Less current portion of mortgage loan payable 45 Mortgage loan payable, net of current portion $ 1,745 Estimated future maturities of the mortgage loan for the next five years and thereafter is as follows: Years Ending December 31: 2020 $ 47 2021 50 2022 47 2023 41 2024 63 Thereafter 1,542 Total $ 1,790 |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2019 | |
Subsequent Events [Abstract] | |
Subsequent Events | NOTE 18- SUBSEQUENT EVENTS The Company has evaluated subsequent events after the balance sheet date of December 31, 2019 through April 29, 2020, the date on which the consolidated financial statements were available to be issued. Based upon this evaluation, management has determined that no material subsequent events have occurred that would require recognition in or disclosures in the accompanying consolidated financial statements, except as follows: In January 2020, a new agreement was negotiated with Triumph, increasing the maximum advance total to $7,000, lowering advance rate from 18 basis points to 15 and the interest rate from prime plus 2.5% to prime plus 2%. Triumph advances 93% of our eligible receivables (compared with 90% prior to the modification), at an advance rate of 15 basis points (20 basis points prior to modification), an interest rate of prime plus 2%, from 2.5% prior to modification, and our prime floor rate reduced from 5% down to 4%. In February 2020, the Company, as plaintiff, filed a complaint with the Circuit Court of Montgomery County, Maryland against Vivos Holdings, LLC, Vivos Real Estate Holdings, LLC and Naveen Doki, to enforce the Company’s rights under certain promissory notes and a personal guarantee made by the defendants. The case is proceeding. The Company believes that it will be granted a judgment in its favor. In February 2020, Maslow took out a $250 6-month term loan from Triumph at 10% APR, in order to meet its cash obligations. On February 28, 2020, On Healthcare Resource Network, LLC filed a complaint against the Company in the Circuit Court of Montgomery County, Maryland. The plaintiff has not specified any alleged damage caused by Maslow and the Company believes any claims are without merit. On March 31, 2020, Maslow terminated the IQS factoring agreement with Wilco Capital Management. In early 2020, the World Health Organization declared the coronavirus outbreak as a pandemic. The impact of the COVID-19 pandemic on the Company and its clients continues to evolve and is expected to adversely impact its profitability, cash, assumptions and projections. Effective April 30, 2020, the Company terminated the related party lease held with VREH. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
Basis of presentation | Basis of Presentation The Company’s consolidated financial statements reflect the financial position and operating results of Reliability, Inc. including its wholly owned subsidiaries. All intercompany transactions and balances have been eliminated in consolidation. |
Fiscal Year | Fiscal Year The Company’s fiscal year is from January 1 st st |
Reclassification | Reclassification Certain amounts in the 2018 consolidated financial statements have been reclassified to conform to the 2019 presentation. |
Management Estimates | Management Estimates The consolidated financial statements and related disclosures are prepared in conformity with United States (U.S.) generally accepted accounting principles (“GAAP”). The Company must make estimates and judgments that affect the amounts reported in the consolidated financial statements and accompanying notes. Estimates are used for, but not limited to revenue recognition, allowances for doubtful accounts, recoverability of notes receivable, useful lives for depreciation and amortization, loss contingencies, allocation of purchase price in connection with business combinations, valuation allowances for deferred income taxes, and the assumptions used for web site development cost classifications. Actual results may be materially different from those estimated. In making its estimates, the Company considers the current economic and legislative environment. |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers all highly liquid investments with an original maturity of 90-days or less to be cash equivalents. |
Concentration of Credit Risk | Concentration of Credit Risk For the year ended December 31, 2019, the Company’s top 10 clients generated over 82% of the revenue. A large portion of our business comes from two clients, AT&T Services, Inc. (inclusive of its DirecTV division) (“AT&T”) and Janssen Pharmaceuticals (which includes workforce partners Johnson & Johnson). AT&T accounted for 37% of revenue in 2019 and 2018. AT&T comprised of 50% and 38% of the accounts receivable balance as of December 31, 2019 and 2018, respectively. Janssen Pharmaceuticals (which includes workforce partners Johnson & Johnson) accounted for approximately 11% of our total revenues for the years ended December 31, 2019 and 2018. Janssen Pharmaceuticals comprised of 19% and 21% of accounts receivable as of December 31, 2019 and 2018, respectively. No other client exceeded 10% of revenues. Financial instruments, which potentially subject the Company to concentrations of credit risk, are primarily cash and accounts receivable. The Company performs continuing credit evaluations of its customers and does not require collateral. The Company has not experienced significant losses related to receivables. |
Accounts Receivable, Contract Assets, and Contract Liabilities (Deferred Revenue) | Accounts Receivable, Contract Assets, and Contract Liabilities (Deferred Revenue) Receivables represent both trade receivables from customers in relation to fees for the Company’s services and unpaid amounts for benefit services provided by third-party vendors, such as healthcare providers for which the Company records a receivable for funding until the payment is received from the customer and a corresponding customer obligations liability until the Company disburses the balances to the vendors. The Company provides for an allowance for doubtful accounts by specifically identifying accounts with a risk of collectability and providing an estimate of the loss exposure. Management considers all contract receivables as of December 31, 2019 and2018 to be fully collectible, therefore an allowance for doubtful accounts is not provided for. The Company records accounts receivable when its right to consideration becomes unconditional. Contract assets primarily relate to the Company rights to consideration for services provided that they are conditional on satisfaction of future performance obligations. The Company holds customer deposits of certain customers related to its EOR business to minimize cash flow impact and reduces risks of uncollectible trade receivables. The Company records contract liabilities (deferred revenue) when payments are made or due prior to the related performance obligations being satisfied. The current portion of the Company contract liabilities is included in accrued liabilities in its consolidated balance sheets. The Company does not have any material contract assets or long-term contract liabilities. At December 31, 2019 and 2018, the Company’s deferred revenue totaled $347 and $235 respectively. |
Fair Value Measurements | Fair Value Measurements The Company measures fair value based on the price that the Company would receive upon selling an asset or pay to transfer a liability in an orderly transaction between market participants at the measurement date. Various inputs are used in determining the fair value of assets or liabilities. Inputs are classified into a three-tier hierarchy, summarized as follows: ● Level 1 – Quoted prices in active markets for identical assets or liabilities; ● Level 2 – Quoted prices in active markets for similar assets and liabilities and inputs that are observable for the assets or liabilities; ● Level 3 – Significant unobservable inputs for the assets or liabilities. When Level 1 inputs are not available, the Company measures fair value using valuation techniques that maximize the use of relevant observable inputs (Level 2) and minimizes the use of unobservable inputs (Level 3).The carrying amounts reported as of December 31, 2019 and 2018 for cash and cash equivalents, trade receivables, prepaid expenses and other current assets, accounts payable and accrued expenses, factoring liability, notes and mortgages payable approximate their fair values due to the short-term nature of these instruments or are based on interest rates available to the Company that are comparable to current market rates. It is not practicable to estimate the fair value of the notes receivable from related parties due to their related party nature. |
Property and Equipment | Property and Equipment Property and equipment are stated at cost and are depreciated using primarily the straight-line method over the following estimated useful lives: furniture, fixtures, and computer equipment — three to seven years; leasehold improvements — over the shorter of the estimated useful life of asset or the lease term. The estimated useful life of buildings is thirty-nine years. Expenditures for renewals and betterments are capitalized whereas expenditures for repairs and maintenance are charged to income as incurred. Upon sale or disposition of property and equipment, the difference between the unamortized cost and the proceeds is recorded as either a gain or a loss. Depreciation expense for the years ended December 31, 2019 and 2018 totaled $22 and $25, respectively. |
Long-Lived Assets | Long-Lived Assets The Company reviews its long-lived assets, primarily fixed assets, intangible assets and goodwill, for impairment whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recovered. The Company looks primarily to the undiscounted future cash flows in its assessment of whether or not long-lived assets have been impaired. There were no impairments recorded during the years ended December 31, 2019 and 2018. |
Intangible Assets | Intangible Assets The Company holds intangible assets with finite lives. Intangible assets with finite useful lives are amortized over their respective estimated useful lives, ranging from three to ten years, based on a pattern in which the economic benefit of the respective intangible asset is realized. As of December 31, 2019, amortization expense was $3. Identifiable intangible assets recognized in conjunction with acquisitions are recorded at fair value. Significant unobservable inputs are used to determine the fair value of the identifiable intangible assets based on the income approach valuation model whereby the present worth and anticipated future benefits of the identifiable intangible assets were discounted back to their net present value. The Company evaluates the recoverability of intangible assets whenever events or changes in circumstances indicate that an intangible asset’s carrying amount may not be recoverable. The Company annually evaluates the remaining useful lives of all intangible assets to determine whether events and circumstances warrant a revision to the remaining period of amortization. The Company determined that there were no impairment indicators for these assets during the year ended December 31, 2019. |
Goodwill | Goodwill Goodwill represents the difference between the enterprise value/cash paid less the fair value of all recognized net asset fair values including identifiable intangible asset values in a business combination. The Company reviews goodwill for impairment annually during the fourth quarter or whenever events or changes in circumstances indicate the carrying value of goodwill may not be recoverable. Based on annual testing, the Company has determined that there was no goodwill impairment during the year ended December 31, 2019. The Company first evaluates qualitative factors to determine whether it is more likely than not (that is, a likelihood of more than 50 percent) that the fair value of the reporting unit is less than it’s carrying amount, including goodwill. If after qualitatively assessing the totality of events or circumstances, the Company determines that it is not more likely than not that the fair value of the reporting unit is less than it’s carrying amount, then further testing is unnecessary. If after assessing the totality of events or circumstances, the Company determines that it is more likely than not that the fair value of the reporting unit is less than its carrying amount, the Company then estimates the fair value of the reporting unit and compares the fair value of the reporting unit with its carrying amount, including goodwill, as discussed below. In assessing whether it is more likely than not that an indefinite-lived intangible asset is impaired, the Company assesses relevant events and circumstances that could affect the significant inputs used to determine the fair value. The quantitative impairment test for an indefinite-lived intangible asset consists of a comparison of the fair value of the asset with its carrying amount. If the carrying amount of an intangible asset exceeds its fair value, the Company shall recognize an impairment loss in an amount equal to that excess. The quantitative goodwill impairment test involves a two-step process. In the first step, the Company compares the fair value of each reporting unit to its carrying value. If the fair value of the reporting unit exceeds its carrying value, goodwill is not impaired, and no further testing is required. If the fair value of the reporting unit is less than the carrying value, The Company must perform the second step of the impairment test to measure the amount of impairment loss. In the second step, the reporting unit’s fair value is allocated to all of the assets and liabilities of the reporting unit, including any unrecognized intangible assets, in a hypothetical analysis that calculates the implied fair value of goodwill in the same manner as if the reporting unit was being acquired in a business combination. If the implied fair value of the reporting unit’s goodwill is less than the carrying value, the difference is recorded as an impairment loss. |
Revenue Recognition | Revenue Recognition The Company adopted Financial Accounting Standards Board (“FASB”) Accounting Standards Updates (“ASU”) ASU 2014-09, Revenue from Contracts with Customers, The Company derives its revenues from three segments: EOR, Recruiting and Staffing, and Video and Multimedia Production. The Company provides temporary staffing and permanent placement services. Revenues are recognized when promised services are delivered to client, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those services. Revenues as presented on the consolidated statements of income represent services rendered to clients, less sales adjustments and allowances. Reimbursements, including those related to out-of-pocket expenses, are also included in revenues, and the related amounts of reimbursable expenses are included in cost of services. The Company records revenue on a gross basis as a principal versus on a net basis as an agent in the presentation of revenues and expenses. The Company has concluded that gross reporting is appropriate because the Company (i) has the risk of identifying and hiring qualified field talent, (ii) has the discretion to select the field talent and establish their price and duties and (iii) bears the risk for services that are not fully paid for by client. Temporary staffing revenues - Field talent revenues from contracts with clients are recognized in the amount to which the Company has a right to invoice, when the services are rendered by the Company’s field talent. Permanent placement staffing revenues - Permanent placement staffing revenues are recognized when employment candidates start their permanent employment. The Company estimates the effect of permanent placement candidates who do not remain with its client through the guarantee period (generally 90 days) based on historical experience. Allowances, recorded as a liability, are established to estimate these losses. Fees to client are generally calculated as a percentage of the new worker’s annual compensation. No fees for permanent placement services are charged to employment candidates. Refer to Note 16 for disaggregated revenues by segment. Payment terms in our contracts vary by the type and location of our client partner and the services offered. The term between invoicing and when payment is due is not significant. There were no unsatisfied performance obligations as of December 31, 2019. There were no revenues recognized during year ended December 31, 2018 related to performance obligations satisfied or partially satisfied in previous periods. There are no contract costs capitalized. The Company did not recognize any contract impairments during the year ended December 31, 2019. |
Advertising | Advertising The Company recognizes advertising expense in selling, general and administrative expenses as the services are incurred. Total advertising expense for the year ended December 31, 2019 and 2018 was $43 and $36, respectively. |
Earnings Per Share | Earnings Per Share Basic earnings per common share are computed by dividing net income by the weighted average number of common shares outstanding during the year. Diluted earnings per share reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock or resulted in the issuance of common stock that then shared in the earnings of the Company. |
Income Taxes | Income Taxes The Company accounts for income taxes utilizing the asset and liability method. Under this method, deferred tax assets and liabilities are determined based on differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis, and net operating loss and tax credit carryforwards, using enacted tax rates and laws that are expected to be in effect when the differences reverse. A valuation allowance is recorded against deferred tax assets in these cases when management does not believe that the realization is more likely than not. While management believes that its judgements and estimates regarding deferred tax assets and liabilities are appropriate, significant differences in actual results may materially affect the Company’s future financial results. The Company recognizes any uncertain income tax positions at the largest amount that is more-likely-than-not to be sustained upon audit by the relevant taxing authority. An uncertain income tax position will not be recognized if it has less than a 50% likelihood of being sustained. The Company’s policy is to recognize interest and/or penalties related to income tax matters in income tax expense. As of December 31, 2019, and 2018, the Company did not record any accruals for interest and penalties. The Company does not foresee material changes to its uncertain tax positions within the next twelve months. The Company’s tax years are subject to examination for 2016 and forward for U.S. Federal tax purposes and for 2015 and forward for state tax purposes. |
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements In January 2017, the FASB issued an updated guidance simplifying the subsequent measurement of goodwill by eliminating “Step 2” from the goodwill impairment test. The updated guidance is effective for public companies’ annual or interim goodwill impairment tests in fiscal years beginning after December 15, 2019. Early adoption is permitted for annual or interim goodwill impairment tests performed on testing dates after January 1, 2017. The new standard is effective for Reliability for the year ending December 31, 2019. The Company adopted this standard during the year ended December 31, 2019 and the adoption was not material to the Company’s consolidated financial statements. In February 2016, the FASB issued ASU No. 2016-02 (Topic 842) “ Leases Leases In August 2018, the FASB issued new guidance on disclosures related to fair value measurements. The guidance is intended to improve the effectiveness of the notes to financial statements by facilitating clearer communication, and it includes multiple new, eliminated and modified disclosure requirements. The guidance was effective for the Company as of January 1, 2020. The adoption of this guidance is not expected to have a material impact on the Company’s consolidated financial statements. In August 2018, the FASB issued ASU No. 2018-15 Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract. In August 2018, the FASB issued new guidance on the accounting for internal-use software. The guidance aligns the accounting for costs incurred to implement a cloud computing arrangement that is a service arrangement with the guidance on capitalizing costs associated with developing or obtaining internal-use software. The guidance was effective for the Company as of January 1, 2020. The adoption of this guidance is not expected to have a material impact on the Company’s consolidated financial statements. In December 2019, the FASB issued new guidance on income taxes. The guidance removes certain exceptions to the general income tax accounting principles and clarifies and amends existing guidance to facilitate consistent application of the accounting principles. The new guidance is effective for us as of January 1, 2021. The Company is assessing the impact of the adoption of this guidance on its consolidated financial statements. The Company does not believe any other recently issued but not yet effective accounting pronouncement, if adopted, would have a material effect on its present or future consolidated financial statements. |
Acquisition (Tables)
Acquisition (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Business Combinations [Abstract] | |
Summary of Assets Acquired and Liabilities Assumed | The allocation is as follows: 2019 Accounts receivable $ 529 Prepaid expenses and other assets 119 Intangible assets 240 Goodwill 451 Liabilities assumed 759 Total net assets acquired $ 580 Cash $ 44 Working capital adjustment 67 Total fair value of consideration transferred for acquired business $ 691 |
Summary of Allocation of Intangible Assets | The allocation of the intangible assets is as follows: Estimated Fair Value Estimated Customer relationships $ 41 3 years Trade name 199 10 years Total $ 240 |
Summary of Unaudited Pro Forma Financial Information | Proforma (Unaudited) 2019 2018 Revenues $ 41,441 $ 40,980 Operating income $ 1,218 $ 1,408 Net Profit $ 248 $ 704 |
Trade Receivables (Tables)
Trade Receivables (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Receivables [Abstract] | |
Summary of Contract Receivables | Contract receivables consist of the following as of: 2019 2018 Billed Receivables $ 1,312 $ 1,573 Unbilled Receivables 209 139 Accounts receivable, factored 5,508 4,153 $ 7,029 $ 5,865 |
Property, Plant and Equipment (
Property, Plant and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Property, Plant and Equipment [Abstract] | |
Summary of Property, Plant and Equipment | Property, plant and equipment as of December 31, 2019 and 2018 consists of the following: 2019 2018 Building $ 1,856 $ - Land 510 - Office equipment 248 43 Computer software 61 41 Leasehold improvements 6 6 Operating lease asset 18 - 2,699 90 Accumulated depreciation (216 ) (57 ) Property, plant and equipment, net $ 2,483 $ 33 |
Goodwill and Other Intangible_2
Goodwill and Other Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Summary of Information Regarding Purchased Intangible Assets | Information regarding purchased intangible assets as of December 31, 2019 is as follows: Gross Value Accumulated Amortization Net Carrying Value Trade name $ 199 $ 2 $ 197 Customer relationships 41 1 40 Total $ 240 $ 3 $ 237 |
Schedule of Estimated Future Amortization Expense | Estimated future amortization expense for the next five years and thereafter is as follows: Years Ending December 31: 2020 $ 34 2021 34 2022 32 2023 20 2024 20 Thereafter 97 Total $ 237 |
Accrued Expenses (Tables)
Accrued Expenses (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Payables and Accruals [Abstract] | |
Summary of Accrued Expenses | Accrued expenses consist of the following as follows: December 31, 2019 2018 Accrued vendor costs $ 229 144 Financed insurance payable 258 252 Other 61 62 Accrued expenses $ 548 $ 458 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Summary of Income Tax Expense | Income tax expense for the years ended December 31, 2019 and 2018 are comprised of the following: 2019 2018 Current federal income tax $ 246 $ 239 Current state income tax 254 99 Deferred income tax (benefit) (344 ) (156 ) Income tax expense $ 156 182 |
Summary of Deferred Income Tax Assets (Liabilities) | Significant components of the Company’s deferred income tax assets (liabilities) are as follows at: December 31 2019 2018 Deferred tax assets (liabilities): Employee accruals $ 74 $ - Cash to accrual (31 ) (335 ) Accrued workers’ compensation/Other 33 - State deduction 7 - Acquisition fees 14 - Deferred tax liabilities: Intangibles - - Fixed assets (13 ) (9 ) Deferred income taxes, net 85 (344 ) Valuation allowance (85 ) - Deferred tax assets (liabilities) $ - $ (344 ) |
Schedule of Income Tax Provision, Reconciled to Tax Computed at Statutory Federal Rate | The income tax provision, reconciled to the tax computed at the statutory federal rate, is as follows: December 31 2019 2018 Tax expense at federal statutory rate $ 74 21.0 % $ 119 21.0 % State income taxes, net 20 5.7 % 32 5.7 % Meals & Entertainment 2 0.7 % 7 1.2 % Penalties 5 1.3 % 11 1.9 % Nondeductible acquisition costs 16 4.6 % - 0 % Valuation allowance 85 - Other, net (46 ) 13.3 % 1 3 2.3 % Income tax expense $ 156 21.3 % $ 182 32.5 % |
Variable Interest Entity (VIE)
Variable Interest Entity (VIE) (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Summary of Assets and Liability of Consolidated VIE | The assets and liability of the consolidated VIE are comprised of the following: 2019 Building $ 1,856 Office equipment 185 Land 510 Accumulated depreciation 148 Liabilities assumed 1,790 Total net assets consolidated $ 613 |
Business Segments (Tables)
Business Segments (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Segment Reporting [Abstract] | |
Reconciliation of Revenue and Operating Income by Reportable Segment to Consolidated Results | The following table provides a reconciliation of revenue and operating income by reportable segment to consolidated results for the periods indicated: December 31 2019 2018 Revenue: EOR $ 34,452 $ 34,573 Recruiting and Staffing 2,190 1,739 Video and Multimedia Production 1,641 1,228 Other 161 98 Total $ 38,444 $ 37,638 |
Mortgage Loan on Real Estate (T
Mortgage Loan on Real Estate (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Abstract] | |
Summary of Mortgage Loan | The mortgage loan as of December 31, 2019 is as follows: 2019 Mortgage Loan $ 1,790 Less current portion of mortgage loan payable 45 Mortgage loan payable, net of current portion $ 1,745 |
Schedule of Estimated Future Maturities of Mortgage Loan | Estimated future maturities of the mortgage loan for the next five years and thereafter is as follows: Years Ending December 31: 2020 $ 47 2021 50 2022 47 2023 41 2024 63 Thereafter 1,542 Total $ 1,790 |
Nature of Operations (Details N
Nature of Operations (Details Narrative) | 12 Months Ended |
Dec. 31, 2019 | |
Employer of Record [Member] | |
Percentage of revenue | 89.60% |
Liquidity and Going Concern (De
Liquidity and Going Concern (Details Narrative) - USD ($) $ in Thousands | 2 Months Ended | 12 Months Ended | ||
Mar. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Apr. 02, 2020 | |
Outstanding debt owed | $ 3,400 | |||
Advances to related parties | $ 688 | $ 925 | ||
Office closures description | Executive management took swift action on March 16, 2020 by reducing hours employees who clients ceased utilizing due to COVID-19 virus concerns and office closures. Six (6) SG&A employees were subsequently furloughed as of March 20, 2020 and a temporary across the board reduction in pay was instituted across the remaining SG&A staff members with executives taking a 50% larger cut in salary. | |||
Cash | $ 246 | $ (63) | ||
Subsequent Event [Member] | ||||
Amount yet to be factored | $ 219 | |||
Subsequent Event [Member] | Maximum [Member] | ||||
Inability to factoring amount | $ 400 | |||
Vivos [Member] | ||||
Advances to related parties | $ 688 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Details Narrative) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Jan. 02, 2019 | |
Deferred revenue | $ 347 | $ 235 | |
Depreciation expense | 22 | 25 | |
Impairments long-lived assets | |||
Amortization expense | 3 | 0 | |
Impairment of intangible assets | |||
Goodwill impairment | |||
Revenue, remaining performance obligation | |||
Contract costs capitalized | |||
Contract impairments | |||
Advertising expense | $ 43 | 36 | |
Uncertain income tax position | less than a 50% likelihood of being sustained | ||
Accruals for interest and penalties | |||
Income tax examination, description | The Company's tax years are subject to examination for 2016 and forward for U.S. Federal tax purposes and for 2015 and forward for state tax purposes. | ||
Operating lease right to use assets | $ 18 | ||
Capitalized capital assets | 12 | ||
Operating Lease [Member] | |||
Operating lease liabilities | $ 18 | ||
Furniture, Fixtures, and Computer Equipment [Member] | Minimum [Member] | |||
Property and equipment useful life | 3 years | ||
Furniture, Fixtures, and Computer Equipment [Member] | Maximum [Member] | |||
Property and equipment useful life | 7 years | ||
Leasehold Improvements [Member] | |||
Property and equipment useful lives | Over the shorter of the estimated useful life of asset or the lease term | ||
Building [Member] | |||
Property and equipment useful life | 39 years | ||
Revenue [Member] | |||
Concentration of credit risk percentage | 82.00% | ||
Concentration risk, benchmark description | No other client exceeded 10% of revenues. | ||
Revenue [Member] | AT&T Services, Inc. [Member] | |||
Concentration of credit risk percentage | 37.00% | 37.00% | |
Revenue [Member] | Janssen Pharmaceuticals [Member] | |||
Concentration of credit risk percentage | 11.00% | 11.00% | |
Accounts Receivable [Member] | AT&T Services, Inc. [Member] | |||
Concentration of credit risk percentage | 50.00% | 38.00% | |
Accounts Receivable [Member] | Janssen Pharmaceuticals [Member] | |||
Concentration of credit risk percentage | 19.00% | 21.00% |
Acquisition (Details Narrative)
Acquisition (Details Narrative) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 02, 2019 | |
Revenue | $ 38,444 | $ 37,638 | |
Net operating loss | 1,084 | $ 1,057 | |
Intelligent Quality Solutions, Inc. [Member] | |||
Notes receivable from relates parties | 691 | $ 691 | |
Revenue | 245 | ||
Net operating loss | 6 | ||
Acquisition costs | $ 6 | ||
Net profit blended tax rate | 28.00% |
Acquisition - Summary of Assets
Acquisition - Summary of Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 02, 2019 | Dec. 31, 2018 |
Goodwill | $ 518 | ||
Intelligent Quality Solutions, Inc. [Member] | |||
Accounts receivable | 529 | ||
Prepaid expenses and other assets | 119 | ||
Intangible assets | 240 | ||
Goodwill | 451 | ||
Liabilities assumed | 759 | ||
Total net assets acquired | 580 | ||
Cash | 44 | ||
Working capital adjustment | 67 | ||
Total fair value of consideration transferred for acquired business | $ 691 | $ 691 |
Acquisition - Summary of Alloca
Acquisition - Summary of Allocation of Intangible Assets (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Estimated Fair Value | $ 240 |
Customer Relationships [Member] | |
Estimated Fair Value | $ 41 |
Estimated Useful Lives | 3 years |
Trade Names [Member] | |
Estimated Fair Value | $ 199 |
Estimated Useful Lives | 10 years |
Acquisition - Summary of Unaudi
Acquisition - Summary of Unaudited Pro Forma Financial Information (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Business Combinations [Abstract] | ||
Revenues | $ 41,441 | $ 40,980 |
Operating income | 1,218 | 1,408 |
Net Profit | $ 248 | $ 704 |
Trade Receivables - Summary of
Trade Receivables - Summary of Contract Receivables (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Receivables [Abstract] | ||
Billed Receivables | $ 1,312 | $ 1,573 |
Unbilled Receivables | 209 | 139 |
Accounts receivable, factored | 5,508 | 4,153 |
Trade Receivables | $ 7,029 | $ 5,865 |
Property, Plant and Equipment -
Property, Plant and Equipment - Summary of Property, Plant and Equipment (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Property, plant and equipment, gross | $ 2,699 | $ 90 |
Accumulated depreciation | (216) | (57) |
Property, plant and equipment, net | 2,483 | 33 |
Building [Member] | ||
Property, plant and equipment, gross | 1,856 | |
Land [Member] | ||
Property, plant and equipment, gross | 510 | |
Office Equipment [Member] | ||
Property, plant and equipment, gross | 248 | 43 |
Computer Software [Member] | ||
Property, plant and equipment, gross | 61 | 41 |
Leasehold Improvements [Member] | ||
Property, plant and equipment, gross | 6 | 6 |
Operating Lease Asset [Member] | ||
Property, plant and equipment, gross | $ 18 |
Goodwill and Other Intangible_3
Goodwill and Other Intangible Assets (Details Narrative) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Goodwill | $ 518 | |
Amortization expense | $ 3 | $ 0 |
Trade Names [Member] | ||
Intangible asset, useful life | 10 years | |
Customer Relationships [Member] | ||
Intangible asset, useful life | 3 years |
Goodwill and Other Intangible_4
Goodwill and Other Intangible Assets - Summary of Information Regarding Purchased Intangible Assets (Details) $ in Thousands | Dec. 31, 2019USD ($) |
Finite-Lived Intangible Assets, Gross Value | $ 240 |
Accumulated Amortization | 3 |
Finite-Lived Intangible Assets, Net Carrying Value | 237 |
Trade Names [Member] | |
Finite-Lived Intangible Assets, Gross Value | 199 |
Accumulated Amortization | 2 |
Finite-Lived Intangible Assets, Net Carrying Value | 197 |
Customer Relationships [Member] | |
Finite-Lived Intangible Assets, Gross Value | 41 |
Accumulated Amortization | 1 |
Finite-Lived Intangible Assets, Net Carrying Value | $ 40 |
Goodwill and Other Intangible_5
Goodwill and Other Intangible Assets - Schedule of Estimated Future Amortization Expense (Details) $ in Thousands | Dec. 31, 2019USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
2020 | $ 34 |
2021 | 34 |
2022 | 32 |
2023 | 20 |
2024 | 20 |
Thereafter | 97 |
Total | $ 237 |
Accrued Expenses - Summary of A
Accrued Expenses - Summary of Accrued Expenses (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Payables and Accruals [Abstract] | ||
Accrued vendor costs | $ 229 | $ 144 |
Financed insurance payable | 258 | 252 |
Other | 61 | 62 |
Accrued expenses | $ 548 | $ 458 |
Income Taxes - Summary of Incom
Income Taxes - Summary of Income Tax Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | ||
Current federal income tax | $ 246 | $ 239 |
Current state income tax | 254 | 99 |
Deferred income tax (benefit) | (344) | (166) |
Income tax expense | $ (156) | $ (182) |
Income Taxes - Summary of Defer
Income Taxes - Summary of Deferred Income Tax Assets (Liabilities) (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Income Tax Disclosure [Abstract] | ||
Deferred tax assets (liabilities): Employee accruals | $ 74 | |
Deferred tax assets (liabilities): Cash to accrual | (31) | (335) |
Deferred tax assets (liabilities): Accrued workers' compensation/Other | 33 | |
Deferred tax assets (liabilities): State deduction | 7 | |
Deferred tax assets (liabilities): Acquisition fees | 14 | |
Deferred tax liabilities: Intangibles | ||
Deferred tax liabilities: Fixed assets | (13) | (9) |
Deferred income taxes, net | 85 | (344) |
Valuation allowance | (85) | |
Deferred tax assets (liabilities) | $ (344) |
Income Taxes - Schedule of Inco
Income Taxes - Schedule of Income Tax Provision, Reconciled to Tax Computed at Statutory Federal Rate (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | ||
Tax expense at federal statutory rate | $ 74 | $ 119 |
State income taxes, net | 20 | 32 |
Meals & Entertainment | 2 | 7 |
Penalties | 5 | 11 |
Nondeductible acquisition costs | 16 | |
Valuation allowance | 85 | |
Other, net | (46) | 13 |
Income tax expense | $ (156) | $ (182) |
Tax expense at federal statutory rate, percentage | 21.00% | 21.00% |
State income taxes, net, percentage | 5.70% | 5.70% |
Meals & Entertainment, percentage | 0.70% | 1.20% |
Penalties, percentage | 1.30% | 1.90% |
Nondeductible acquisition costs, percentage | 4.60% | 0.00% |
Valuation allowance, percentage | ||
Other, net, percentage | 13.30% | 2.30% |
Income tax expense, percentage | 21.30% | 32.50% |
Debt (Details Narrative)
Debt (Details Narrative) - USD ($) $ in Thousands | Jun. 13, 2019 | Jan. 07, 2019 | Jan. 05, 2018 | Jan. 31, 2020 | Dec. 31, 2016 | Dec. 31, 2019 | Dec. 31, 2018 | Jan. 19, 2018 |
Tax liability | $ 817 | $ 664 | ||||||
Unpaid balance of purchased accounts percentage | 10.00% | |||||||
Finance line fees | $ 65 | |||||||
Wilco Capital Management [Member] | ||||||||
Convertible promissory note initial principal amount | 479 | |||||||
Convertible promissory note term | 1 year | |||||||
Unpaid balance of purchased accounts percentage | 90.00% | |||||||
Minimum [Member] | Wilco Capital Management [Member] | ||||||||
Monthly volume of factoring relationship | $ 125 | |||||||
Maximum [Member] | Wilco Capital Management [Member] | ||||||||
Monthly volume of factoring relationship | $ 500 | |||||||
Prime Rate [Member] | Wilco Capital Management [Member] | ||||||||
Convertible promissory note interest rate | 1.275% | |||||||
Factoring and Security Agreement [Member] | Subsequent Event [Member] | Minimum [Member] | ||||||||
Eligible for sale percentage | 90.00% | |||||||
Factoring and Security Agreement [Member] | Subsequent Event [Member] | Maximum [Member] | ||||||||
Eligible for sale percentage | 93.00% | |||||||
Factoring and Security Agreement [Member] | Subsequent Event [Member] | Prime Rate [Member] | ||||||||
Debt instrument description of variable rate | In January 2020, a new agreement was negotiated with Triumph lowering advance rate from 18 basis points to 15 and the interest rate from prime plus 2.5% to prime plus 2%. | |||||||
Factoring and Security Agreement [Member] | Subsequent Event [Member] | Prime Rate [Member] | Minimum [Member] | ||||||||
Convertible promissory note interest rate | 2.00% | |||||||
Factoring and Security Agreement [Member] | Subsequent Event [Member] | Prime Rate [Member] | Maximum [Member] | ||||||||
Convertible promissory note interest rate | 2.50% | |||||||
Recourse Contract [Member] | ||||||||
Proceeds from sale of receivables | 29,367 | 30,458 | ||||||
Outstanding balance of recourse contract | $ 5,030 | $ 4,153 | ||||||
Vivos Holdings, LLC [Member] | ||||||||
Accelerated tax event estimated annual impact | $ 215 | |||||||
Accelerated tax event description | This triggered an accelerated tax event, a $215 estimated annual impact per year for 4 years, that Reliability is working with the IRS to pay off. | |||||||
Triumph Business Capital [Member] | Factoring and Security Agreement [Member] | ||||||||
Convertible promissory note term | 1 year | |||||||
Increase in factoring fee | $ 5,500 | |||||||
Convertible Debt [Member] | ||||||||
Notes payable | $ 890 | |||||||
Warrants to purchase shares of common stock | 0.5 | |||||||
Convertible promissory note initial principal amount | $ 50 | |||||||
Convertible promissory note exchange value | $ 50 | |||||||
Convertible promissory note interest rate | 12.00% | |||||||
Convertible promissory note term | 1 year | |||||||
Convertible Debt [Member] | Minimum [Member] | ||||||||
Proceeds from issuance of common stock | $ 5,000 |
Variable Interest Entity (VIE_2
Variable Interest Entity (VIE) (Details Narrative) $ in Thousands | Dec. 31, 2019USD ($) |
Related party note receivable with VIE | $ 772 |
Related party mortgage loan payable, VIE | 1,790 |
Due Within Next Year [Member] | |
Related party mortgage loan payable, VIE | $ 45 |
Variable Interest Entity (VIE_3
Variable Interest Entity (VIE) - Summary of Assets and Liability of Consolidated VIE (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Assets consolidated gross | $ 2,699 | $ 90 |
Accumulated depreciation | 216 | 57 |
Total net assets consolidated | 2,483 | 33 |
Building [Member] | ||
Assets consolidated gross | 1,856 | |
Office Equipment [Member] | ||
Assets consolidated gross | 248 | 43 |
Land [Member] | ||
Assets consolidated gross | 510 | |
Variable Interest Entity, Primary Beneficiary [Member] | ||
Accumulated depreciation | 148 | |
Liabilities assumed | 1,790 | |
Total net assets consolidated | 613 | |
Variable Interest Entity, Primary Beneficiary [Member] | Building [Member] | ||
Assets consolidated gross | 1,856 | |
Variable Interest Entity, Primary Beneficiary [Member] | Office Equipment [Member] | ||
Assets consolidated gross | 185 | |
Variable Interest Entity, Primary Beneficiary [Member] | Land [Member] | ||
Assets consolidated gross | $ 510 |
Commitments and Contingencies (
Commitments and Contingencies (Details Narrative) - Hop Capital [Member] $ in Thousands | Oct. 09, 2018USD ($)Integer |
Payments of claim amount by defendants | $ | $ 400 |
Loss contingency, name of defendant | Maslow Media Group, Inc. |
Loss contingency, number of defendants | Integer | 6 |
Equity (Details Narrative)
Equity (Details Narrative) - $ / shares | Dec. 31, 2019 | Dec. 31, 2018 |
Equity [Abstract] | ||
Capital stock shares authorized | 300,000,000 | 300,000,000 |
Capital stock par value |
Related Party Transactions (Det
Related Party Transactions (Details Narrative) - USD ($) $ in Thousands | Dec. 02, 2019 | Oct. 29, 2019 | Sep. 05, 2019 | Jul. 31, 2019 | Jun. 27, 2019 | Jun. 12, 2019 | May 20, 2019 | Jul. 10, 2018 | Jul. 05, 2018 | Aug. 10, 2017 | Nov. 15, 2016 | Nov. 09, 2016 | Mar. 31, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Sep. 18, 2019 | Sep. 30, 2018 | Nov. 15, 2017 | Mar. 01, 2017 |
Proceeds from settlement of acquisition | $ 2 | |||||||||||||||||||
Management fees payable on monthly basis | $ 20 | |||||||||||||||||||
Management fee | 0 | $ 260 | ||||||||||||||||||
Repayments of related party | 688 | 925 | ||||||||||||||||||
Gross proceeds received | $ 5,000 | |||||||||||||||||||
Average sale price percentage | 120.00% | |||||||||||||||||||
Convertible note warrants trigger value | $ 5,000 | |||||||||||||||||||
Secured Promissory Note Agreement [Member] | ||||||||||||||||||||
Related party outstanding balance amount | 752 | |||||||||||||||||||
Accrued interest receivable | 2 | |||||||||||||||||||
Secured Promissory Note Agreement [Member] | Naveen Doki and Silvija Valleru [Member] | ||||||||||||||||||||
Ownership percentage | 5.00% | |||||||||||||||||||
Receivable Financing Agreement [Member] | ||||||||||||||||||||
Related party outstanding balance amount | 212 | |||||||||||||||||||
Debt Settlement Agreement [Member] | ||||||||||||||||||||
Related party outstanding balance amount | 231 | |||||||||||||||||||
Debt Settlement Agreement [Member] | HCRN Credit Facility [Member] | ||||||||||||||||||||
Related party outstanding balance amount | 351 | |||||||||||||||||||
Receivable Advance Agreement [Member] | HCRN Credit Facility [Member] | ||||||||||||||||||||
Related party outstanding balance amount | $ 635 | |||||||||||||||||||
Securities Purchase Agreement [Member] | Mark Speck [Member] | Warrant [Member] | ||||||||||||||||||||
Promissory note payable | 53 | |||||||||||||||||||
Note interest percentage | 12.00% | |||||||||||||||||||
Related party outstanding balance amount | $ 50 | |||||||||||||||||||
Debt due date | Jul. 31, 2020 | |||||||||||||||||||
Principal amount | $ 50 | |||||||||||||||||||
Conversion of shares | 81,616 | |||||||||||||||||||
Securities Purchase Agreement [Member] | Nick Tsahalis [Member] | Common Stock [Member] | ||||||||||||||||||||
Conversion of shares | 32,646 | |||||||||||||||||||
Securities Purchase Agreement [Member] | Nick Tsahalis [Member] | Warrant [Member] | ||||||||||||||||||||
Conversion of shares | 16,323 | |||||||||||||||||||
Securities Purchase Agreement [Member] | Convertible Promissory Note [Member] | Common Stock [Member] | ||||||||||||||||||||
Promissory note payable | $ 53 | |||||||||||||||||||
Note interest percentage | 12.00% | |||||||||||||||||||
Related party outstanding balance amount | $ 50 | |||||||||||||||||||
Debt due date | Jun. 27, 2020 | |||||||||||||||||||
Principal amount | $ 50 | |||||||||||||||||||
Securities Purchase Agreement [Member] | Convertible Promissory Note [Member] | Nick Tsahalis [Member] | ||||||||||||||||||||
Promissory note payable | 105 | |||||||||||||||||||
Note interest percentage | 12.00% | |||||||||||||||||||
Related party outstanding balance amount | $ 100 | |||||||||||||||||||
Debt due date | Jul. 31, 2020 | |||||||||||||||||||
Principal amount | $ 100 | |||||||||||||||||||
Vivos Holdings, LLC [Member] | ||||||||||||||||||||
Debt instrument periodic payment | $ 30 | |||||||||||||||||||
Vivos Holdings, LLC [Member] | Stock Purchase Agreement [Member] | ||||||||||||||||||||
Promissory note payable | $ 1,773 | |||||||||||||||||||
Note installments term description | During the second loan period, interest shall be paid in twenty equal consecutive payments, quarterly. Principal plus any unpaid interest is due September 20, 2023. | |||||||||||||||||||
Debt instrument periodic payment | $ 15 | |||||||||||||||||||
Related parties, notes receivable | $ 1,400 | |||||||||||||||||||
Related party outstanding balance amount | 2,666 | 2,569 | ||||||||||||||||||
Accrued interest receivable | 162 | 94 | ||||||||||||||||||
Debt due date | Sep. 20, 2023 | |||||||||||||||||||
Vivos Holdings, LLC [Member] | Stock Purchase Agreement [Member] | First Loan [Member] | ||||||||||||||||||||
Note interest percentage | 2.50% | |||||||||||||||||||
Vivos Holdings, LLC [Member] | Stock Purchase Agreement [Member] | Second Loan [Member] | ||||||||||||||||||||
Note interest percentage | 2.50% | |||||||||||||||||||
Vivos Holdings, LLC [Member] | Maslow Media Group, Inc. [Member] | ||||||||||||||||||||
Acquisition percentage | 100.00% | |||||||||||||||||||
Purchase price | $ 1,750 | |||||||||||||||||||
Proceeds from settlement of acquisition | 1,400 | |||||||||||||||||||
Promissory note payable | $ 350 | |||||||||||||||||||
Note installments term description | The promissory note was to be paid in twenty-four equal installments, including interest at 4.5%, in the amount of approximately $15, commencing six months after closing with the last payment on March 1, 2019. | |||||||||||||||||||
Note interest percentage | 4.50% | |||||||||||||||||||
Debt instrument periodic payment | $ 15 | |||||||||||||||||||
Dr. Naveen Doki [Member] | Personal Guaranty Agreement [Member] | ||||||||||||||||||||
Acquisition percentage | 5.00% | |||||||||||||||||||
Repayments of related party | $ 3,000 | |||||||||||||||||||
VREH [Member] | ||||||||||||||||||||
Promissory note payable | $ 772 | |||||||||||||||||||
Note installments term description | During the second period, interest is payable in 20 equal consecutive installments and the principal balance plus accrued and unpaid interest is due March 31, 2023. | |||||||||||||||||||
Note interest percentage | 3.50% | 3.50% | ||||||||||||||||||
Related party outstanding balance amount | 772 | $ 746 | ||||||||||||||||||
Accrued interest receivable | $ 781 | $ 781 | ||||||||||||||||||
Debt due date | Mar. 31, 2023 | |||||||||||||||||||
Vivos [Member] | ||||||||||||||||||||
Repayments of related party | $ 688 | |||||||||||||||||||
Vivos [Member] | Secured Promissory Note Agreement [Member] | ||||||||||||||||||||
Conversion of shares | 30,000,000 | |||||||||||||||||||
Vivos [Member] | Receivable Financing Agreement [Member] | ||||||||||||||||||||
Note installments term description | In October 2018, Vivos defaulted on the agreement and on October 25, 2018, executed a settlement agreement whereby the Maslow is to pay the outstanding balance over eleven installments with the final amount due August 31, 2019. | In October of 2018, Vivos defaulted on the agreement and on January 24, 2019, executed a settlement agreement whereby the Company is to pay the outstanding balance over eight installments with the final amount due August 31, 2019. | ||||||||||||||||||
Repayments of related party | $ 485 | $ 400 | ||||||||||||||||||
Debt due date | Aug. 31, 2019 | |||||||||||||||||||
Accounts receivable remitted | $ 670 | 556 | ||||||||||||||||||
Daily remittances | 5 | $ 4 | ||||||||||||||||||
Vivos [Member] | Maslow Media Group, Inc. [Member] | Secured Promissory Note Agreement [Member] | ||||||||||||||||||||
Note interest percentage | 2.50% | |||||||||||||||||||
Debt instrument periodic payment | $ 10 | |||||||||||||||||||
Debt due date | Nov. 1, 2026 | |||||||||||||||||||
Principal amount | $ 750 | |||||||||||||||||||
Vivos [Member] | Argus Capital Funding [Member] | Receivable Advance Agreement [Member] | ||||||||||||||||||||
Repayments of related party | $ 705 | |||||||||||||||||||
Related party advance fees | 487 | |||||||||||||||||||
Loan fees | $ 218 | |||||||||||||||||||
Company and Vivos [Member] | Kinetic Direct Funding LLC [Member] | Kinetic Financing Agreement [Member] | ||||||||||||||||||||
Repayments of related party | $ 485 | |||||||||||||||||||
Debt due date | Aug. 31, 2019 | |||||||||||||||||||
Accounts receivable remitted | $ 670 | |||||||||||||||||||
Daily remittances | $ 5 | |||||||||||||||||||
Credit Cash NJ, LLC [Member] | Receivable Advance Agreement [Member] | Maslow Credit Facility [Member] | ||||||||||||||||||||
Loan fees | $ 600 | |||||||||||||||||||
Exchange of line of credit facility | $ 780 | |||||||||||||||||||
HCRN [Member] | Receivable Advance Agreement [Member] | HCRN Credit Facility [Member] | ||||||||||||||||||||
Note installments term description | Pursuant to the settlement agreement, the Company agreed to pay $10 per week until the entire balance of the Maslow Credit Facility was paid off. | |||||||||||||||||||
Loan fees | $ 1,005 | |||||||||||||||||||
Naveen Doki [Member] | Merger Agreement [Member] | ||||||||||||||||||||
Conversion of shares | 207,384,793 | |||||||||||||||||||
Conversion of shares, percentage | 69.13% | |||||||||||||||||||
Silvija Valleru [Member] | Merger Agreement [Member] | ||||||||||||||||||||
Conversion of shares | 51,844,970 | |||||||||||||||||||
Conversion of shares, percentage | 17.13% | |||||||||||||||||||
Hawkeye Enterprises, Inc [Member] | Securities Purchase Agreement [Member] | ||||||||||||||||||||
Non refundable deposit | $ 75 | |||||||||||||||||||
Hawkeye Enterprises, Inc [Member] | Maslow Media Group, Inc. [Member] | Securities Purchase Agreement [Member] | Mark Speck [Member] | Common Stock [Member] | ||||||||||||||||||||
Conversion of shares | 16,323 | |||||||||||||||||||
Hawkeye Enterprises, Inc [Member] | Maslow Media Group, Inc. [Member] | Securities Purchase Agreement [Member] | Mark Speck [Member] | Warrant [Member] | ||||||||||||||||||||
Conversion of shares | 81,616 |
Business Segments - Reconciliat
Business Segments - Reconciliation of Revenue and Operating Income by Reportable Segment to Consolidated Results (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Total | $ 38,444 | $ 37,638 |
EOR [Member] | ||
Total | 34,452 | 34,573 |
Recruiting and Staffing [Member] | ||
Total | 2,190 | 1,739 |
Video and Multimedia Production [Member] | ||
Total | 1,641 | 1,228 |
Other [Member] | ||
Total | $ 161 | $ 98 |
Mortgage Loan on Real Estate (D
Mortgage Loan on Real Estate (Details Narrative) - USD ($) $ in Thousands | Jan. 22, 2018 | Dec. 31, 2019 |
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Abstract] | ||
Loan amount | $ 1,875 | |
Interest rate | 4.50% | |
Loan description | The loan was in the amount of $1,875 with an interest rate of 4.5% annually for the first 60 months of the loan and changes to 5.25% annually on January 28, 2023 for 59 months. The monthly payments during repayment period is $11 with a lump sum payment of $1,393 on December 28th, 2027. | |
Loan amount changes to annually percentage | 5.25% | |
Repayments of mortgage loans | $ 11 | |
Lump-some payments | $ 1,393 | |
Outstanding mortgage loan | $ 1,790 |
Mortgage Loan on Real Estate -
Mortgage Loan on Real Estate - Summary of Mortgage Loan (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Abstract] | ||
Mortgage Loan | $ 1,790 | |
Less current portion of mortgage loan payable | 45 | |
Mortgage loan payable, net of current portion | $ 1,745 |
Mortgage Loan on Real Estate _2
Mortgage Loan on Real Estate - Schedule of Estimated Future Maturities of Mortgage Loan (Details) $ in Thousands | Dec. 31, 2019USD ($) |
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Abstract] | |
2020 | $ 47 |
2021 | 50 |
2022 | 47 |
2023 | 41 |
2024 | 63 |
Thereafter | 1,542 |
Total | $ 1,790 |
Subsequent Events (Details Narr
Subsequent Events (Details Narrative) - Subsequent Event [Member] - USD ($) $ in Thousands | Feb. 29, 2020 | Jan. 31, 2020 | Jan. 31, 2020 |
Triumph [Member] | |||
Maximum advance receivable | $ 7,000 | ||
Prime rate description | In January 2020, a new agreement was negotiated with Triumph, increasing the maximum advance total to $7,000, lowering advance rate from 18 basis points to 15 and the interest rate from prime plus 2.5% to prime plus 2%. Triumph advances 93% of our eligible receivables (compared with 90% prior to the modification), at an advance rate of 15 basis points (20 basis points prior to modification), an interest rate of prime plus 2%, from 2.5% prior to modification, and our prime floor rate reduced from 5% down to 4%. | ||
Debt instrument term | 6 months | ||
Debt instrument interest rate | 10.00% | ||
Triumph [Member] | 18 Basis Points [Member] | Maximum [Member] | |||
Prime interest rate | 2.50% | ||
Triumph [Member] | 15 Basis Points [Member] | Minimum [Member] | |||
Prime interest rate | 2.00% | ||
Triumph [Member] | Prime Rate [Member] | |||
Prime interest rate | 93.00% | ||
Triumph [Member] | Prime Floor Rate [Member] | Maximum [Member] | |||
Prime interest rate | 5.00% | ||
Triumph [Member] | Prime Floor Rate [Member] | Minimum [Member] | |||
Prime interest rate | 4.00% | ||
Maslow Media Group, Inc. [Member] | |||
Loans payable | $ 250 |