3. REVENUE RECOGNITION (Tables)

9 Months Ended

May 31, 2019

Revenue Recognition [Abstract]

Disaggregation of revenues

Disaggregation of Revenues:	Three Months Ended May 31, 2019		Nine Months Ended May 31, 2019
Software licenses
Point in time	$	5,634,925	$	13,983,798
Over time		189,575		677,388
Consulting services
Over time		4,112,421		11,283,359
Total Revenue	$	9,936,921	$	25,944,545

Adjustments resulting from Topic 606

The following table summarizes the adjustments made to accounts on the condensed consolidated balance sheet as of September 1, 2018 as a result of applying the modified retrospective method to adopt ASC Topic 606:

	As Reported August 31, 2018		Adjustments to reflect the adoption of ASC Topic 606			As Adjusted September 1, 2018
Capitalized Software, net	$	5,152,594	$	(629,100	)	$	4,523,494
Deferred revenue		381,928		294,825			676,753
Deferred income taxes, net		3,195,139		(230,981	)		2,964,158
Retained Earnings	$	18,461,540	$	(692,944	)	$	17,768,596

The following tables present the amount by which each condensed consolidated financial statement line item is affected as of and for the three and nine months ended May 31, 2019 by ASC Topic 606:

	Three Months Ended May 31, 2019
	As Reported			Balances Without the adoption of ASC Topic 606			Effect of Change
Revenues	$	9,936,921		$	9,932,576		$	4,345
Cost of revenues		2,324,188			2,277,531			46,657
Gross profit		7,612,733			7,655,045			(42,312	)
Income from operations		3,882,033			3,924,345			(42,312	)
Income before provision for income taxes		3,852,440			3,894,752			(42,312	)
Provision for income taxes		(963,734	)		(974,312	)		(10,578	)
Net Income	$	2,888,706		$	2,920,440		$	(31,734	)
Earnings per share-Diluted	$	0.16		$	0.16		$	–
Weighted-average common shares outstanding, Diluted		18,096,195			18,096,195			–

	Nine Months Ended May 31, 2019
	As Reported			Balances Without the adoption of ASC Topic 606			Effect of Change
Revenues	$	25,944,545		$	25,937,313		$	7,232
Cost of revenues		6,734,890			6,561,464			173,426
Gross profit		19,209,655			19,375,849			(166,194	)
Income from operations		8,698,941			8,865,135			(166,194	)
Income before provision for income taxes		8,569,692			8,735,886			(166,194	)
Provision for income taxes		(2,045,590	)		(2,101,773	)		(56,183	)
Net Income	$	6,524,102		$	6,634,113		$	(110,011	)
Earnings per share-Diluted	$	0.36		$	0.37		$	–
Weighted-average common shares outstanding, Diluted		18,008,336			18,008,336			–

	Nine Months Ended May 31, 2019
	As Reported			Balances Without the adoption of ASC Topic 606			Effect of Change
Cash Flows From Operating Activities:
Net income	$	6,524,102		$	6,634,113		$	(110,011	)
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		2,070,583			2,175,691			(105,108	)
Changes in operating assets and liabilities:
Deferred revenue		145,406			138,174			(7,232	)
Net cash provided by operating activities		7,513,957			7,263,196			(250,761	)
Cash flows used in investing activities
Capitalized computer software development costs	$	(1,362,329	)	$	(1,640,862	)	$	278,533