Note 3 - Supplemental Balance Sheet Information (in Thousands)

12 Months Ended

Dec. 31, 2022

Notes to Financial Statements

Supplemental Balance Sheet Disclosures [Text Block]

3. Supplemental Balance Sheet Information

Accounts Receivable Net	December 31,
Accounts receivable, net, consists of the following as of periods presented (in thousands):	2022			2021
Trade	$	53,658		$	44,424
Unbilled		10,436			8,168
Non-trade		1,274			2,143
Accounts receivable, gross		65,368			54,735
Less allowance for doubtful accounts		(1,654	)		(564	)
Accounts receivable, net	$	63,714		$	54,171

Property and Equipment, Net	December 31,
Property and equipment, net consists of the following as of the periods presented (in thousands):	2022			2021
Equipment	$	5,109		$	4,741
Furniture and fixtures		2,319			2,319
Leasehold improvements		352			351
Internal use software		17,298			15,823
Property and equipment, gross		25,078			23,234
Less accumulated depreciation and amortization		(21,817	)		(20,305	)
Property and equipment, net	$	3,261		$	2,929

Depreciation expense (including amortization of internal use software and intangible assets as described below) was $2.0 million and $2.1 million for the years ended  December 31, 2022 and 2021, respectively.

The Company capitalized $1.5 million and $1.2 million of costs related to internal use software in the years ended December 31, 2022 and 2021, respectively.

The Company recognized approximately $1.2 million and $1.2 million of amortization expense related to internal use software for the years ended December 31, 2022 and 2021, respectively.

Goodwill	Americas			Asia-Pacific		EMEA
Goodwill (in thousands):
Balance at December 31, 2021	$	3,728		$	–	$	438	$	4,166
Change in goodwill due to impact of foreign currency		–			–		–		–
Impairment of goodwill		(2,458	)		–		–		(2,458	)
Balance at December 31, 2022	$	1,270		$	–	$	438	$	1,708

Goodwill is generally deductible for tax purposes, except for the portion related to purchase accounting step-up goodwill. 

As of December 31, 2022 and 2021, accumulated impairment losses of goodwill were $2.5 million and $0, respectively.

Goodwill Impairment of Resource Plus of North Florida, Inc.

The Company acquired Resource Plus of North Florida, Inc. ("Resource Plus”) in 2018 as a joint venture partnership and owns 51% of the Resource Plus business. At the time of the acquisition, the Company recorded $2.0 million of goodwill and $1.2 million of intangible assets relating to brand and technology.  Due to the loss of a significant customer, during the year ended December 31, 2022, Resource Plus did not meet original forecast and reduced forecasts. The Company performed the Step 1 qualitative impairment test using a combination of the discounted cash flow and guideline public company methodologies.

Fair value determinations require considerable judgment and are sensitive to changes in underlying assumptions, estimates, and market factors. Estimating the fair value of individual reporting units requires the Company to make assumptions and estimates regarding its future plans, as well as industry, economic, and regulatory conditions. These assumptions and estimates include estimated future annual net cash flows, income tax considerations, discount rates, growth rates, and other market factors. The Company’s expectations also include certain assumptions that could be negatively impacted if the Company is unable to meet its cost expectations in relation to inflation. If current expectations of future growth rates and margins are not met, if market factors outside of the Company’s control, such as discount rates, income tax rates, foreign currency exchange rates, inflation, or any other factors, change, or if management’s expectations or plans otherwise change, including updates to the Company’s long-term operating plans, then one or more of our reporting units might become impaired in the future.

As of December 31, 2022, the Company was required to test the Resource Plus reporting unit for impairment due to continued decline in revenues and profitability. The Company performed the Step 1 qualitative impairment test using a combination of the discounted cash flow and guideline public company methodologies. Key assumptions include management's estimates of forecasted revenue and forecasted cash flows.

The impairment test indicated the goodwill of Resource Plus was fully impaired and the Company recorded an impairment loss of $2.0 million during the year ended December 31, 2022.

Goodwill Impairment ofSPAR TODOPROMO, SAPI, de CV

The Company acquired SPAR TODOPROMO, SAPI, de CV ("SPAR Mexico”) in 2011 as a joint venture partnership and currently owns 51% of the SPAR Mexico business. At time of acquisition, the Company recorded $0.5 million of goodwill. During year ended December 31, 2022, SPAR Mexico did not meet original forecasts due to labor law changes in Mexico. The Company performed the Step 1 qualitative impairment test using a combination of the discounted cash flow and guideline public company methodologies. The impairment test indicated that the goodwill of SPAR Mexico was fully impaired and the Company recorded an impairment loss of $0.5 million USD during the year ended December 31, 2022.

Intangible Assets, Net	December 31,
Intangible assets, net consists of the following as of the periods presented:	2022			2021
Customer contracts and lists	$	3,543		$	3,362
Trade names		900			900
Patents		870			870
Non-compete agreements		520			520
Intangible assets, gross		5,833			5,652
Less accumulated amortization		(3,793	)		(3,357	)
Intangible assets, net	$	2,040		$	2,295

The Company is amortizing its intangible assets over lives ranging from 5 to 25 years. Amortization expense for the years ended  December 31, 2022 and 2021 was approximately $0.4 and $0.5, respectively.

The annual amortization for each of the following years succeeding December 31, 2022 is summarized as follows (in thousands):

Year	Amount
2023	$	351
2024		290
2025		204
2026		204
2027		108
Thereafter		883
Total	$	2,040

Accrued Expenses and Other Current Liabilities	December 31,
Accrued expenses and other current liabilities consists of the following as of the periods presented:	2022		2021
Taxes payable	$	2,660	$	2,397
Accrued salaries and wages		9,327		8,082
Accrued accounting and legal expenses		2,186		1,251
Accrued third party labor		2,411		1,927
Majority stockholders change of control agreement		–		4,478
Other		3,677		3,896
Accrued expenses and other current liabilities	$	20,261	$	22,031