Significant Accounting Policies (Policies)

12 Months Ended

Jun. 30, 2017

Consolidation, Policy [Policy Text Block]

Principles of Consolidation.

The accompanying consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. Intercompany transactions and accounts have been eliminated in consolidation.

Reclassification, Policy [Policy Text Block]

Reclassifications.

Certain prior year amounts have been reclassified to conform to the current year presentation. The Company adopted ASU

No.

2015

03,

“

Simplifying the Presentation of Debt Issuance Costs,” on

July 1, 2016.

To conform to the current year’s presentation, debt issuance costs have been reclassified from Other assets and are now presented as a direct deduction to the carrying amount of the related debt balance as of

June 30, 2016.

The reclassification had

further effect on the Company’s Consolidated Financial Statements.

Use of Estimates, Policy [Policy Text Block]

Use of Estimates.

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Management bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are

not

readily apparent from other sources. The most significant estimates include:

● sales returns and allowances;

● trade marketing and merchandising;

● allowance for doubtful accounts;

● inventory valuation;

●

valuation

and recoverability of long-lived and intangible assets

;

● income taxes and valuation allowance on deferred income taxes, and;

● accruals for, and the probability of, the outcome of any current litigation.

On a continual basis, management reviews its estimates utilizing currently available information, changes in facts and circumstances, historical experience and reasonable assumptions. After such reviews, and if deemed appropriate, those estimates are adjusted accordingly. Actual results could differ from those estimates.

Derivatives, Policy [Policy Text Block]

Derivative Liabilities

The Company generally does

not

use derivative financial instruments to hedge exposures to cash flow or market risks. However, certain other financial instruments, such as warrants and embedded conversion features on the subordinated convertible debt, are

classified as derivative liabilities due to protection provisions within the agreements. Such financial instruments are initially recorded at fair value using the Black Scholes model and subsequently adjusted to fair value at the close of each reporting period. The Company accounts for derivative instruments and debt instruments in accordance with the interpretative guidance of ASC

815

and associated pronouncements related to the classification and measurement of warrants and instruments with conversion features.

Revenue Recognition, Policy [Policy Text Block]

Revenue Recognition.

For product sales, the Company recognizes revenue when the product’s title and risk of loss transfers to the customer. The Company believes this revenue recognizing practice is appropriate because the Company’s sales policies meet the following

four

criteria: (i) persuasive evidence that an arrangement exists; (ii) delivery has occurred; (iii) the seller’s price to the buyer is fixed and determinable; and (iv) collectability is reasonably assured. The Company’s sales policy is to require customers to provide purchase orders with the agreed upon selling prices and shipping terms. The Company evaluates the credit risk of each customer and establishes an allowance of doubtful accounts for any credit risk. Sales returns and allowances are estimated upon shipment, based on historical experience.

Shipping and Handling Cost, Policy [Policy Text Block]

Shipping and Handling Costs.

Shipping and handling costs were approximately

$296

and

$302

for the fiscal years ended

June 30, 2017

and

2016,

respectively, and are included in cost of sales in the accompanying Consolidated Statements of Operations.

Advertising Cost, Policy, Expensed Advertising Cost [Policy Text Block]

Trade Marketing and Merchandising.

In order to support the Company’s proprietary nutraceutical product lines, various promotional activities are conducted through the retail trade, distributors or directly with consumers, including in-store display and product placement programs, feature price discounts, coupons, and other similar activities. The Company regularly reviews and revises, when it deems necessary, estimates of costs to the Company for these promotional programs based on estimates of what will be redeemed by the retail trade, distributors, or consumers. These estimates are made using various techniques, including historical data on performance of similar promotional programs. Differences between estimated expense and actual performance are generally

not

material and are recognized as a change in management’s estimate in a subsequent period.

Advertising Costs, Policy [Policy Text Block]

Advertising.

Advertising costs are expensed as incurred. Advertising expense was approximately

$22

and

$29

for the fiscal years ended

June 30, 2017

and

2016,

respectively.

Share-based Compensation, Option and Incentive Plans Policy [Policy Text Block]

Stock-Based Compensation.

The Company has

two

stock-based compensation plans that have outstanding options issued in accordance with such plans. The Company periodically grants stock options to employees and directors in accordance with the provisions of its stock option plans, with the exercise price of the stock options being set at the closing market price of the common stock on the date of grant. Stock based compensation expense is recognized based on the estimated fair value, utilizing a Black-Scholes option pricing model, of the instrument on the date of grant over the requisite vesting period, which is generally

three

years.

Income Tax, Policy [Policy Text Block]

Income Taxes

. The Company accounts for income taxes using the asset and liability method. Accordingly, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in the tax rate is recognized in income or expense in the period that the change is effective.

Tax benefits are recognized when it is probable that the deduction will be sustained. A valuation allowance is established when it is more likely than

not

that all or a portion of a deferred tax asset will

not

be realized.

The Company files a U.S. federal income tax return as well as returns for various states. The Company

’s income taxes have

not

been examined by any tax authorities for the periods subject to review by such taxing authorities. Uncertain tax positions taken on our tax returns are accounted for as

liabilities for unrecognized tax benefits. The Company recognizes interest and penalties, if any, related to unrecognized tax benefits in general and administrative expenses in the Consolidated Statements of Operations. There were

liabilities recorded for uncertain tax positions at

June 30, 2017

2016.

Earnings Per Share, Policy [Policy Text Block]

Earnings Per Share.

Basic earnings per common share amounts are based on weighted average number of common shares outstanding. Diluted earnings per share amounts are based on the weighted average number of common shares outstanding, plus the incremental shares that would have been outstanding upon the assumed exercise of all potentially dilutive stock options, warrants and convertible debt, subject to anti-dilution limitations using the treasury stock method and if converted method.

Fair Value of Financial Instruments, Policy [Policy Text Block]

Fair Value of Financial Instruments.

Generally accepted accounting principles require disclosing the fair value of financial instruments to the extent practicable for financial instruments which are recognized or unrecognized in the balance sheet. The fair value of the financial instruments disclosed herein is

not

necessarily representative of the amount that could be realized or settled, nor does the fair value amount consider the tax consequences of realization or settlement.

In assessing the fair value of financial instruments, the Company uses a variety of methods and assumptions, which are based on estimates of market conditions and risks existing at the time. For certain instruments, including cash and cash equivalents, accounts receivable, accounts payable, and accrued expenses, it was estimated that the carrying amount approximated fair value because of the short maturities of these instruments. All debt is based on current rates at which the Company could borrow funds with similar remaining maturities and approximates fair value.

Loans and Leases Receivable, Allowance for Loan Losses Policy [Policy Text Block]

Accounts Receivable and Allowance for Doubtful Accounts.

In the normal course of business, the Company extends credit to customers. Accounts receivable, less the allowance for doubtful accounts, reflect the net realizable value of receivables, and approximate fair value. The Company believes there is

concentration of credit risk with any single customer whose failure or nonperformance would materially affect the Company’s results other than as discussed in Note

(c) – Significant Risks and Uncertainties – Major Customers. On a regular basis, the Company evaluates its accounts receivables and establishes an allowance for doubtful accounts based on a combination of specific customer circumstances, credit conditions, and historical write-offs and collections. The allowance for doubtful accounts as of

June 30, 2017

and

2016

was

$99

and

$101,

respectively. Accounts receivable are charged off against the allowance after management determines that the potential for recovery is remote.

Inventory, Policy [Policy Text Block]

Inventories.

Inventories are stated at the lower of cost or market. Cost is determined using the

first

-in,

first

-out method. Allowances for obsolete and overstock inventories are estimated based on “expiration dating” of inventory and projection of sales.

Property, Plant and Equipment, Policy [Policy Text Block]

Property and Equipment.

Property and equipment are recorded at cost and are depreciated using the straight line method over the following estimated useful lives:

Building	15 Years
Leasehold Improvements	Shorter of estimated useful life or term of lease
Machinery and Equipment	7 Years
Transportation Equipment	5 Years

Goodwill and Intangible Assets, Policy [Policy Text Block]

Impairment of Long-Lived Assets.

Long-lived assets are reviewed for impairment when circumstances indicate that the carrying value of an asset

may

not

be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of the assets to the future net cash flows estimated by the Company to be generated by such assets. If such assets are considered to be impaired, the impairment to be recognized is the amount by which the carrying amount of the assets exceeds the fair value of the assets. Assets to be disposed of by sale are recorded as held for sale at the lower of carrying value or estimated net realizable value. Tests for impairment or recoverability are performed at least annually and require significant management judgment and the use of estimates which the Company believes are reasonable and appropriate at the time of the impairment test. Future unanticipated events affecting cash flows and changes in market conditions could affect such estimates and result in the need for an impairment charge. The Company also re-evaluates the periods of amortization to determine whether circumstances warrant revised estimates of current useful lives. An impairment loss of approximately

$0.4

million was recorded in the fiscal year ended

June 30, 2016.

impairment losses were identified or recorded in the fiscal year ended

June 30, 2017

on the Company’s other intangible assets.

Other intangible assets consist of trade names, license fees, and unpatented technology. Amortization is being recorded on the straight-line basis over periods ranging from

years to

years based on contractual or estimated lives. Other intangible assets of

$134

and

$235

are included in security deposits and other assets in the consolidated balance sheets as of

June 30, 2017

and

2016,

respectively.

Cost Method Investments, Policy [Policy Text Block]

Investment in iBio, Inc.

The Company accounts for its investment in iBio, Inc. (“iBio”) common stock on the cost basis as it retained approximately

of its interest in iBio (

1,266,706

common shares) (the “iBio Stock”) at the time of the spin-off of this subsidiary in

August 2008.

The Company reviews its investment in iBio for impairment and records a loss when there is deemed to be a permanent impairment of the investment. To date, there were cumulative impairment charges of approximately

$2.2

million. The market value of the iBio Stock as of

June 30, 2017

was approximately

$0.5

million based on the trade price at the close of trading on

June 30, 2017.

New Accounting Pronouncements, Policy [Policy Text Block]

Accounting Pronouncements Recently Adopted

August 2014,

the FASB issued ASU

2014

15,

Disclosure of Uncertainties about an Entity

’s Ability to Continue as a Going Concern. Management of public and private companies will be required to evaluate whether there are conditions and events that raise substantial doubt about the entity’s ability to continue as a going concern within

one

year after the financial statements are issued (or available to be issued when applicable) and, if so, disclose that fact. Management will be required to make this evaluation for both annual and interim reporting periods, if applicable. This standard was effective for the Company on

June 30, 2017.

April, 2015,

the FASB issued ASU

No.

2015

03,

Interest

– Imputation of Interest (Subtopic

835

), which includes provisions intended to simplify the presentation of debt issuance costs in the financial statements. These amendments require that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. This new guidance was effective for the Company on

July 1, 2016.

November 2015,

the FASB issued

ASU

No.

2015

17,

Income Taxes (Topic

740

), that requires deferred tax liabilities and assets be classified as noncurrent in a classified statement of financial position. The current requirement that deferred tax liabilities and assets of a tax-paying component of an entity be offset and presented as a single amount is

not

affected by this amendment. The new guidance is effective for fiscal years, and interim periods within those years, beginning after

December 15, 2016.

Early adoption is permitted and the standard

may

be applied either retrospectively or on a prospective basis to all deferred tax assets and liabilities. As permitted, the Company early adopted this new standard on

June 30, 2017.

Accounting

Pronouncements

Not

Yet Adopted

May 2014,

the FASB issued

ASU2014

09,

“Revenue from Contracts with Customers”, Topic

606.

This update affects any entity that either enters into contracts with customers to transfer goods or services or enters into contracts for the transfer of nonfinancial assets, unless those contracts are within the scope of other standards. The guidance in this update supersedes the revenue recognition requirements in Topic

605,

Revenue Recognition and most industry-specific guidance. The core principle of the guidance is that an entity should recognize revenue to illustrate the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The new guidance also includes a cohesive set of disclosure requirements that will provide users of financial statements with comprehensive information about the nature, amount, timing, and uncertainty of revenue and cash flows arising from a reporting

organization

’s contracts with customers. This new guidance is effective for the Company beginning on

July 1, 2018.

During

2016,

the FASB issued several accounting updates (ASU

No.

2016

08,

2016

and

2016

) to clarify implementation guidance and correct unintended application of the

guidance. The standard allows for either “full retrospective” adoption, meaning the standard is applied to all of the periods presented, or “modified retrospective” adoption, meaning the standard is applied only to the most current period presented in the financial statements. The Company continues to make progress in its implementation and assessment of the new standard and while the completion of this assessment is still ongoing, based on the progress to date, the Company does

not

expect the new standard will have a material impact on its revenue recognition accounting policy or its Consolidated Financial Statements.

July 2015,

the FASB issued

ASU

No.

2015

11,

Simplifying the Measurement of Inventory (Topic

330

), an accounting standard that requires inventory be measured at the lower of cost and net realizable value and options that currently exist for market value be eliminated. The standard defines net realizable value as estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. This new guidance was effective for the Company on

July 1, 2017.

The Company does

not

expect the adoption of this ASU to impact the Company’s consolidated financial statements.

February 2016,

the FASB issued ASU

No.

2016

02,

Leases (Topic

842

), which requires lessees to put most leases on their balance sheets by recognizing a lessee

’s rights and obligations, while expenses will continue to be recognized in a similar manner to today’s legacy lease accounting guidance. This ASU could also significantly affect the financial ratios used for external reporting and other purposes, such as debt covenant compliance. This ASU will be effective for the Company on

January 1, 2019,

with early adoption permitted. The Company is currently in the

process of assessing the impact of this ASU on its consolidated financial statements.

March 2016,

the FASB i

ssued ASU

No.

2016

09,

Stock Compensation (Topic

718

), which includes provisions intended to simplify various aspects related to how share-based payments are accounted for and presented in the financial statements. This guidance requires recognition of excess tax benefits and deficiencies (resulting from an increase or decrease in the fair value of an award from grant date to the vesting or exercise date) in the provision for income taxes as a discrete item in the quarterly period in which they occur. Currently, excess tax benefits are recognized in equity. In addition, these amounts will be classified as an operating activity in the Statement of Cash Flows instead of as a financing activity.

October, 2016,

the FASB issued ASU

No.

2016

16,

“Income Taxes (Topic

740

): Intra-Entity Transfers of Assets Other than Inventory,” which eliminates the requirement to defer recognition of income taxes on intra-entity transfers until the asset is sold to an outside party. The new guidance requires the recognition of current and deferred income taxes on intra-entity transfers of assets other than inventory, such as intellectual property and property, plant and equipment, when the transfer occurs. The guidance is effective for the Company on

July 1, 2019

and early adoption is permitted. The standard requires a “modified retrospective” adoption, meaning the standard is applied through a cumulative adjustment in retained earnings as of the beginning of the period of adoption. This new guidance is

not

expected to have a material impact on the Company’s Consolidated Financial Statements.

For the years

ended

June 30, 2016

and

2017,

the Company did

not

recognized any excess tax benefits in equity. These amounts

may

not

necessarily be indicative of future amounts that

may

be recognized subsequent to the adoption of this new standard, as any excess tax benefits recognized would be dependent on future stock prices, employee exercise behavior and applicable tax rates. The new guidance was effective for the Company beginning on

July 1, 2017.

August, 2016,

the FASB issued ASU

No.

2016

15,

“Statement of Cash Flows (Topic

230

): Classification of Certain Cash Receipts and Cash Payments,” which clarifies how certain cash receipts and payments are to be presented in the statement of cash flows. The guidance is effective for the Company on

July 1, 2018

and early adoption is permitted. This new guidance is

not

expected to have a material impact on the Company’s Consolidated Financial Statements.

July 2017,

the Financial Accounting Standards Board (“

FASB”) issued Accounting Standards Update (“ASU”)

2017

11,

"Earnings Per Share (Topic

260

) Distinguishing Liabilities from Equity (Topic

480

) Derivatives and Hedging (Topic

815

)," which addresses the complexity of accounting for certain financial instruments with down round features. The amendments are effective for the Company on

July 1, 2019

for the fiscal year ended

June 30, 2020,

and the interim periods within it. Early adoption is available. The Company is currently evaluating the impact on the Company’s Consolidated Financial Statements.