8. INCOME TAXES (Tables)

12 Months Ended

Aug. 31, 2018

Income Tax Disclosure [Abstract]

Components of the income tax provision

	2018			2017			2016
Current
Federal	$	2,370,955		$	2,385,660		$	2,118,229
State		460,619			217,281			171,840
Foreign		104,377			28,103			19,428
		2,935,951			2,631,044			2,309,497
Deferred
Federal		(1,698,201	)		(612,629	)		22,936
State		(33,620	)		434,255			(46,177	)
		(1,731,821	)		(178,374	)		(23,241	)
Total	$	1,204,130		$	2,452,670		$	2,286,256

Effective income tax rate

	2018			2017			2016
Income tax computed at federal statutory tax rate		25.4%			34.0%			34.0%
State taxes, net of federal benefit		4.0			3.5			3.4
Meals & Entertainment		0.0			0.0			0.1
Stock Based Compensation		0.5			0.0			1.3
Other permanent differences		1.2			(0.5	)		(0.6	)
Research and development credit		(2.6	)		(3.6	)		(2.7	)
Domestic Production Activities		(1.8	)		(2.3	)		(3.6	)
Change in deferred income taxes due to statutory rate changes		-14.8			–			–
Change in prior year estimated taxes		(0.0	)		(1.3	)		(0.3	)
Total		11.9%			29.8%			31.6%

Components of the Company deferred tax assets and liabilities

	2018			2017
Deferred tax assets
Accrued payroll and other expenses	$	187,220		$	254,897
Deferred revenue		34,955			62,617
Capitalized merger costs		365,801			540,312
Intellectual property		11,066			18,775
State taxes		96,730			91,513
State Tax Deferred		174,800			293,879
Total deferred tax assets		870,572			1,261,993
Less: Valuation allowance		–			–
		870,572			1,261,993
Deferred tax liabilities
Property and equipment		(57,636	)		(95,071	)
State Tax Deferred		(10,701	)		(16,763	)
Intellectual Property		(2,593,292	)		(4,343,311	)
Capitalized computer software development costs		(1,404,082	)		(1,733,808	)
Total deferred tax liabilities		(4,065,711	)		(6,188,953	)
Net deferred tax liabilities	$	(3,195,139	)	$	(4,926,960	)