10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934. For the quarterly period ended September 30, 2023

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934. For the transition period from __________ to _________.

Commission File Number 001-34941

PARK CITY GROUP, INC. dba REPOSITRAK

(Exact name of small business issuer as specified in its charter)

Nevada	37-1454128
(State or other jurisdiction of incorporation or organization)	(IRS Employer Identification No.)

5282 South Commerce Drive, Suite D292, Murray, Utah 84107

(Address of principal executive offices)

(435) 645-2000

(Registrant’s telephone number)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common stock, par value $0.01 per share	TRAK	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities and Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. ☒ Yes ☐ No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (Sec.232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). ☒ Yes ☐ No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). ☐ Yes  ☒ No

As of November 14, 2023, 18,158,205 shares of the registrant’s common stock, $0.01 par value, were issued and outstanding.

PARK CITY GROUP, INC.

TABLE OF CONTENTS

		Page
PART I - FINANCIAL INFORMATION
Item 1.	Financial Statements	1
	Consolidated Condensed Balance Sheets as of September 30, 2023 and June 30, 2023 (Unaudited)	1
	Consolidated Condensed Statements of Operations for the Three Months Ended September 30, 2023 and 2022 (Unaudited)	2
	Consolidated Condensed Statements of Cash Flows for the Three Months Ended September 30, 2023 and 2022 (Unaudited)	3
	Consolidated Condensed Statements of Stockholders’ Equity for the Three Months Ended September 30, 2023 and 2022 (Unaudited)	4
	Notes to Consolidated Condensed Financial Statements	5
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	12
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	18
Item 4.	Controls and Procedures	19
PART II OTHER INFORMATION
Item 1.	Legal Proceedings	19
Item 1A.	Risk Factors	19
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	19
Item 3.	Defaults Upon Senior Securities	19
Item 5.	Other Information	19
Item 6.	Exhibits	19
Signatures		20

PART I

FINANCIAL INFORMATION

ITEM 1.  FINANCIAL STATEMENTS

PARK CITY GROUP, INC.

Consolidated Condensed Balance Sheets (Unaudited)

	September 30, 2023			June 30, 2023
Assets
Current Assets
Cash	$	23,697,228		$	23,990,879
Receivables, net of allowance for doubtful accounts of $194,656 and $170,103 at September 30, 2023 and June 30, 2023, respectively		3,022,038			2,523,019
Contract asset – unbilled current portion		160,749			186,959
Prepaid expense and other current assets		316,473			573,763
Total Current Assets		27,196,488			27,274,620
Property and equipment, net		844,705			986,300
Other Assets:
Deposits and other assets		22,414			22,414
Prepaid expense – less current portion		21,147			36,282
Contract asset – unbilled long-term portion		108,052			108,052
Operating lease – right-of-use asset		295,967			310,796
Customer relationships		229,950			262,800
Goodwill		20,883,886			20,883,886
Capitalized software costs, net		619,866			698,281
Total Other Assets		22,181,282			22,322,511
Total Assets	$	50,222,475		$	50,583,431
Liabilities and Shareholders’ Equity
Current liabilities
Accounts payable	$	314,888		$	431,387
Accrued liabilities		1,608,640			1,620,000
Contract liability – deferred revenue		2,080,424			1,903,001
Operating lease liability – current		60,063			58,771
Notes payable and financing leases – current		214,926			219,262
Total current liabilities		4,278,941			4,232,421
Long-term liabilities
Operating lease liability – less current portion		247,537			263,047
Notes payable and financing leases – less current portion		81,534			206,032
Total liabilities		4,608,012			4,701,500
Commitments and contingencies
Stockholders’ equity:
Preferred Stock; $0.01 par value, 30,000,000 shares authorized;
Series B Preferred, 700,000 shares authorized; 625,375 shares issued and outstanding at September 30, 2023 and June 30, 2023;		6,254			6,254
Series B-1 Preferred, 550,000 shares authorized; 212,402 shares issued and outstanding at September 30, 2023 and June 30, 2023, respectively		2,124			2,124
Common Stock, $0.01 par value, 50,000,000 shares authorized; 18,171,068 and 18,309,051 issued and outstanding at September 30, 2023 and June 30, 2023, respectively		181,713			183,093
Additional paid-in capital		66,507,428			67,732,887
Accumulated deficit		(21,083,056	)		(22,042,427	)
Total stockholders’ equity		45,614,463			45,881,931
Total liabilities and stockholders’ equity	$	50,222,475		$	50,583,431

See accompanying notes to consolidated condensed financial statements.

1

PARK CITY GROUP, INC.

Consolidated Condensed Statements of Operations (Unaudited)

	Three Months Ended September 30,
	2023			2022
Revenue	$	5,060,112		$	4,720,477
Operating expense:
Cost of revenue and product support		766,334			832,704
Sales and marketing		1,505,501			1,200,259
General and administrative		1,279,323			1,223,462
Depreciation and amortization		308,945			236,006
Total operating expense		3,860,103			3,492,431
Income from operations		1,200,009			1,228,046
Other income (expense):
Interest income		258,161			79,092
Interest expense		(6,344	)		(24,652	)
Unrealized gain (loss) on short term investments		27,186			(7,415	)
Other gain (loss)		-			70,047
Income before income taxes		1,479,012			1,345,118
(Provision) for income taxes:		(100,464	)		(60,006	)
Net income		1,378,548			1,285,112
Dividends on preferred stock		(146,611	)		(146,611	)
Net income applicable to common shareholders	$	1,231,937		$	1,138,501
Weighted average shares, basic		18,225,000			18,465,000
Weighted average shares, diluted		18,839,000			18,753,000
Basic income per share	$	0.07		$	0.06
Diluted income per share	$	0.07		$	0.06

See accompanying notes to consolidated condensed financial statements.

2

PARK CITY GROUP, INC.

Consolidated Condensed Statements of Cash Flows (Unaudited)

	Three Months Ended September 30,
	2023			2022
Cash flows from operating activities:
Net income	$	1,378,548		$	1,285,112
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		308,945			236,006
Amortization of operating right of use asset		14,829			14,142
Stock compensation expense		85,375			111,046
Bad debt expense		75,000			150,000
(Increase) decrease in:
Accounts receivables		(547,809	)		(255,281	)
Long-term receivables, prepaids and other assets		216,340			434,448
Increase (decrease) in:
Accounts payable		(116,499	)		(264,711	)
Operating lease liability		(57,164	)		(13,003	)
Accrued liabilities		(14,218	)		(58,182	)
Deferred revenue		177,423			171,898
Net cash provided by operating activities		1,520,770			1,811,475
Cash flows from investing activities:
Purchase of property and equipment		-			(19,533	)
Net cash provided by (used in) investing activities		-			(19,533	)
Cash flows from financing activities:
Net (decrease) increase in lines of credit		-			(1,294,317	)
Common Stock buyback/retirement		(1,322,082	)		(103,657	)
Proceeds from employee stock plan		57,743			48,903
Dividends paid		(421,248	)		(146,611	)
Payments on notes payable and capital leases		(128,834	)		(129,481	)
Net cash used in financing activities		(1,814,421	)		(1,625,163	)
Net increase (decrease) in cash and cash equivalents		(293,651	)		166,779
Cash and cash equivalents at beginning of period		23,990,879			21,460,948
Cash and cash equivalents at end of period	$	23,697,228		$	21,627,727
Supplemental disclosure of cash flow information:
Cash paid for income taxes	$	221,661		$	146,723
Cash paid for interest	$	2,329		$	24,653
Cash paid for operating leases	$	18,141		$	17,613
Supplemental disclosure of non-cash investing and financing activities:
Common stock to pay accrued liabilities	$	37,500		$	76,873
Dividends accrued on preferred stock	$	146,611		$	146,611

See accompanying notes to consolidated condensed financial statements.

3

PARK CITY GROUP, INC.

Consolidated Statements of Stockholders’ Equity (Deficit) (Unaudited)

Three Months Ended September 30, 2023

	Series B Preferred Stock				Series B-1 Preferred Stock				Common Stock						Additional Paid-In			Accumulated
	Shares		Amount		Shares		Amount		Shares			Amount			Capital			Deficit			Total
Balance, June 30, 2023		625,375	$	6,254		212,402	$	2,124		18,309,051		$	183,093		$	67,732,887		$	(22,042,427	)	$	45,881,931
Stock issued for:
Accrued compensation		-		-		-		-		3,716			37			37,463			-			37,500
Employee stock plan		-		-		-		-		13,326			133			57,610			-			57,743
Stock buyback		-		-		-		-		(155,025	)		(1,550	)		(1,320,532	)		-			(1,322,082	)
Preferred Dividends-Declared		-		-		-		-		-			-			-			(146,611	)		(146,611	)
Common Stock Dividends-Declared		-		-		-		-		-			-			-			(272,566	)		(272,566	)
Net income		-		-		-		-		-			-			-			1,378,548			1,378,548
Balance, September 30, 2023		625,375	$	6,254		212,402	$	2,124		18,171,068		$	181,713		$	66,507,428		$	(21,083,056	)	$	45,614,463

Three Months Ended September 30, 2022

	Series B Preferred Stock				Series B-1 Preferred Stock				Common Stock						Additional Paid-In			Accumulated
	Shares		Amount		Shares		Amount		Shares			Amount			Capital			Deficit			Total
Balance, June 30, 2022		625,375	$	6,254		212,402	$	2,124		18,460,538		$	184,608		$	68,653,361		$	(25,943,287	)	$	42,903,060
Stock issued for:
Accrued compensation		-		-		-		-		15,603			156			76,717			-			76,873
Employee stock plan		-		-		-		-		13,064			131			48,772			-			48,903
Stock buyback		-		-		-		-		(20,859	)		(209	)		(103,448	)		-			(103,657	)
Preferred Dividends-Declared		-		-		-		-		-			-			-			(146,611	)		(146,611	)
Common Stock Dividends-Declared		-		-		-		-		-			-			-			(277,162	)		(277,162	)
Net income		-		-		-		-		-			-			-			1,285,112			1,285,112
Balance, September 30, 2022		625,375	$	6,254		212,402	$	2,124		18,468,346		$	184,686		$	68,675,402		$	(25,081,948	)	$	43,786,518

See accompanying notes to consolidated condensed financial statements.

4

PARK CITY GROUP, INC.

NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS

(Unaudited)

NOTE 1.  OVERVIEW OF OPERATIONS AND BASIS FOR PRESENTATION

Overview

Park City Group, Inc. dba ReposiTrak, Inc., a Nevada corporation (“ReposiTrak”, “Park City Group”, “We”, “us”, “our” or the “Company”) is a Software-as-a-Service (“SaaS”) which operates a business-to-business (“B2B”) e-commerce, compliance & traceability, and supply chain management platform that partners with retailers, wholesalers, distributors and their product suppliers to (a) help them manage specific programs, such as out-of-stock management and scan-based trading; (b) reduce risk in their supply chain by managing compliance documents and data; ensure compliance with new regulatory requirements supporting traceability; and (c) improve product ordering and forecasting in order to accelerate sales, control risks, and improve supply chain efficiencies.

The Company’s services are grouped in three application suites:

1.	ReposiTrak Compliance Management (“Compliance”) solutions, which helps the Company’s customers vet suppliers and reduce a company’s potential regulatory, legal, and criminal risk from its supply chain partners by providing a way for them to ensure these suppliers are compliant with food safety regulations, such as the Food Safety Modernization Act of 2011 (“FSMA”);
2.	ReposiTrak Traceability Network (“Traceability or RTN”), which helps the Company’s customers comply with federal regulatory requirements of traceability and provides the lowest cost, easiest to use way to manage the capture and sharing of key data elements (“KDEs”) now required by Section 204d of FSMA 2011 as designated products move through the supply chain at each ‘event’ known as a ‘critical tracking event’ or “CTE”, which includes tracking from farm to shelf; and
3.	ReposiTrak Supply Chain Solutions (“Supply Chain”), which help the Company’s customers to more efficiently manage various interactions with their suppliers. In other words, it provides customers with greater flexibility in sourcing products by enabling them to choose new suppliers and integrate them into their supply chain faster and more cost effectively, and it helps them to manage these relationships more efficiently, enhancing revenue while lowering working capital, labor costs and reducing waste.

The Company’s services are delivered though proprietary software products designed, developed, marketed, and supported by the Company. These products provide visibility and facilitate improved business processes among all key constituents in the supply chain, starting with the retailer and moving backwards to suppliers and eventually to raw material providers.

The Company provides cloud-based applications and services that address e-commerce, supply chain, food safety, compliance and traceability activities. The principal customers for the Company’s products are household name multi-store food retail chains and restaurants including their suppliers, branded food manufacturers, food wholesalers and distributors, and other food service businesses.

The Company has a hub and spoke business model. The Company is typically engaged by retailers and wholesalers (“Hubs”), which in turn require their suppliers (“Spokes”) to utilize the Company’s services.

The Company is incorporated in the State of Nevada and has three principal subsidiaries: PC Group, Inc., a Utah corporation (98.76% owned) (“PCG Utah”); Park City Group, Inc., a Delaware corporation (100% owned) (“PCG Delaware”); and ReposiTrak (100% owned) (PCG Utah, PCG Delaware, and ReposiTrak are, collectively, the “Subsidiaries”). All intercompany transactions and balances have been eliminated in the Company’s consolidated financial statements, which contain the operating results of the operations. The Company has no business operations separate from the operations conducted through its Subsidiaries.

The Company’s principal executive offices are located at 5282 South Commerce Drive, Suite D292, Murray, Utah 84107. Its telephone number is (435) 645-2000. Its website address is www.repositrak.com. 

Basis of Financial Statement Presentation

The interim financial information of the Company as of September 30, 2023 and for the three months ended September 30, 2023 is unaudited, and the balance sheet as of June 30, 2023 is derived from audited financial statements. The accompanying condensed consolidated financial statements have been prepared in accordance with United States generally accepted accounting principles ("U.S. GAAP") for interim financial statements. Accordingly, they omit or condense notes and certain other information normally included in financial statements prepared in accordance with U.S. GAAP. The accounting policies followed for quarterly financial reporting conform with the accounting policies disclosed in the Notes to Financial Statements included in our Annual Report on Form 10-K for the year ended June 30, 2023. In the opinion of management, all adjustments necessary for a fair presentation of the financial information for the interim periods reported have been made. All such adjustments are of a normal recurring nature. The results of operations for the three months ended September 30, 2023 are not necessarily indicative of the results that can be expected for the fiscal year ending June 30, 2024. The unaudited condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and the notes thereto included in our Annual Report on Form 10-K for the year ended June 30, 2023.

5

NOTE 2.  SIGNIFICANT ACCOUNTING POLICIES

Principles of Consolidation

The financial statements presented herein reflect the consolidated financial position of Park City Group, Inc. and our subsidiaries. All inter-company transactions and balances have been eliminated in consolidation.

Use of Estimates

The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that materially affect the amounts reported in the consolidated financial statements. Actual results could differ from these estimates. The methods, estimates, and judgments the Company uses in applying its most critical accounting policies have a significant impact on the results it reports in its financial statements. The U.S. Securities and Exchange Commission (“SEC”) has defined the most critical accounting policies as those that are most important to the portrayal of the Company’s financial condition and results and require the Company to make its most difficult and subjective judgments, often because of the need to make estimates of matters that are inherently uncertain. Based on this definition, the Company’s most critical accounting policies include revenue recognition, goodwill, other long-lived asset valuations, income taxes, stock-based compensation, and capitalization of software development costs.

Revenue Recognition

The Company recognizes revenue as it transfers control of deliverables (products, solutions and services) to its customers in an amount reflecting the consideration to which it expects to be entitled. To recognize revenue, the Company applies the following five step approach: (1) identify the contract with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to the performance obligations in the contract; and (5) recognize revenue when a performance obligation is satisfied. The Company accounts for a contract based on the terms and conditions the parties agree to, if the contract has commercial substance and if collectability of consideration is probable. The Company applies judgment in determining the customer’s ability and intention to pay, which is based on a variety of factors including the customer’s historical payment experience.

The Company may enter into arrangements that consist of multiple performance obligations. Such arrangements may include any combination of its deliverables. To the extent a contract includes multiple promised deliverables, the Company applies judgment to determine whether promised deliverables are capable of being distinct and are distinct in the context of the contract. If these criteria are not met, the promised deliverables are accounted for as a combined performance obligation. For arrangements with multiple distinct performance obligations, the Company allocates consideration among the performance obligations based on their relative standalone selling price. Standalone selling price is the price at which the Company would sell a promised good or service separately to the customer. When not directly observable, the Company typically estimates standalone selling price by using the expected cost plus a margin approach. The Company typically establishes a standalone selling price range for its deliverables, which is reassessed on a periodic basis or when facts and circumstances change.

For performance obligations where control is transferred over time, revenue is recognized based on the extent of progress towards completion of the performance obligation. The selection of the method to measure progress towards completion requires judgment and is based on the nature of the deliverables to be provided. Revenue related to fixed-price contracts for application development and systems integration services, consulting or other technology services is recognized as the service is performed using the output method, under which the total value of revenue is recognized based on each contract’s deliverable(s) as they are completed and when value is transferred to a customer. Revenue related to fixed-price application maintenance, testing and business process services is recognized based on our right to invoice for services performed for contracts in which the invoicing is representative of the value being delivered, in accordance with the practical expedient in FASB ASC Topic 606, Revenue from Contracts with Customers (“Topic 606”), paragraph 606-10-55-18 (“ASC 606-10-55-18”).

If the Company’s invoicing is not consistent with the value delivered, revenue is recognized as the service is performed based on the method described above. The output method measures the results achieved and value transferred to a customer, which is updated as the project progresses to reflect the latest available information; such estimates and changes in estimates involve the use of judgment. The cumulative impact of any revision in estimates is reflected in the financial reporting period in which the change in estimate becomes known and any anticipated losses on contracts are recognized immediately. Revenue related to fixed-price hosting and infrastructure services is recognized based on the Company’s right to invoice for services performed for contracts in which the invoicing is representative of the value being delivered, in accordance with the practical expedient in ASC 606-10-55-18. If the Company’s invoicing is not consistent with value delivered, revenue is recognized on a straight-line basis unless revenue is earned and obligations are fulfilled in a different pattern. The revenue recognition method applied to the types of contracts described above provides the most faithful depiction of performance towards satisfaction of the Company’s performance obligations.

Revenue related to the Company’s software license arrangements that do not require significant modification or customization of the underlying software is recognized when the software is delivered as control is transferred at a point in time. For software license arrangements that require significant functionality enhancements or modification of the software, revenue for the software license and related services is recognized as the services are performed in accordance with the methods described above. In software hosting arrangements, the rights provided to the customer, such as ownership of a license, contract termination provisions and the feasibility of the client to operate the software, are considered in determining whether the arrangement includes a license or a service. Revenue related to software maintenance and support is generally recognized on a straight-line basis over the contract period.

6

Management expects that incremental commission fees paid as a result of obtaining a contract are recoverable and therefore the Company capitalized them as contract costs. The Company recognizes the incremental costs of obtaining contracts as an expense when incurred if the amortization period of the asset that the Company otherwise would have recognized is one year or less.

Revenue related to transaction-based or volume-based contracts is recognized over the period the services are provided in a manner that corresponds with the value transferred to the customer to-date relative to the remaining services to be provided.

From time to time, the Company may enter into arrangements with third party suppliers to resell products or services. In such cases, the Company evaluates whether the Company is the principal (i.e., report revenue on a gross basis) or agent (i.e., report revenue on a net basis). In doing so, the Company first evaluates whether it controls the good or service before it is transferred to the customer. If the Company controls the good or service before it is transferred to the customer, the Company is the principal; if not, the Company is the agent. Determining whether the Company controls the good or service before it is transferred to the customer may require judgment.

The Company provides customers with assurance that the related deliverable will function as the parties intended because it complies with agreed-upon specifications. General updates or patch fixes are not considered an additional performance obligation in the contract.

Variable consideration is estimated using either the sum of probability weighted amounts in a range of possible consideration amounts (expected value), or the single most likely amount in a range of possible consideration amounts (most likely amount), depending on which method better predicts the amount of consideration to which we may be entitled. The Company includes in the transaction price variable consideration only to the extent it is probable that a significant reversal of revenue recognized will not occur when the uncertainty associated with the variable consideration is resolved. The Company’s estimates of variable consideration and determination of whether to include estimated amounts in the transaction price may involve judgment and is based largely on an assessment of its anticipated performance and all information that is reasonably available to the Company.

The Company assesses the timing of the transfer of goods or services to the customer as compared to the timing of payments to determine whether a significant financing component exists. As a practical expedient, the Company does not assess the existence of a significant financing component when the difference between payment and transfer of deliverables is a year or less. If the difference in timing arises for reasons other than the provision of finance to either the customer or us, no financing component is deemed to exist. The primary purpose of the Company’s invoicing terms is to provide customers with simplified and predictable ways of purchasing its services, not to receive or provide financing from or to customers. The Company does not consider set up or transition fees paid upfront by its customers to represent a financing component, as such fees are required to encourage customer commitment to the project and protect us from early termination of the contract.

Trade Accounts Receivable and Contract Balances

We classify our right to consideration in exchange for deliverables as either a receivable or a contract asset (unbilled receivable). A receivable is a right to consideration that is unconditional (i.e. only the passage of time is required before payment is due). For example, we recognize a receivable for revenue related to our transaction or volume-based contracts when earned regardless of whether amounts have been billed. We present such receivables in trade accounts receivable, net in our consolidated statements of financial position at their net estimated realizable value. We maintain an allowance for doubtful accounts to provide for the estimated amount of receivables that may not be collected. The allowance is based upon an assessment of customer creditworthiness, historical payment experience, the age of outstanding receivables, judgment, and other applicable factors.

A contract asset is a right to consideration that is conditional upon factors other than the passage of time. Contract assets are presented in current and other assets in our consolidated balance sheets and primarily relate to unbilled amounts on fixed-price contracts utilizing the output method of revenue recognition. The table below shows movements in contract assets:

	Contract assets
Balance – June 30, 2023	$	295,011
Revenue recognized during the period but not billed		-
Amounts reclassified to accounts receivable		(10,000	)
Other		(16,210	)
Balance – September 30, 2023	$	268,801	(1)

⁽¹⁾ Contract asset balances for September 30, 2023 include a current and a long-term contract asset of $160,749 and $108,052, respectively.

7

Our contract assets and liabilities are reported at the end of each reporting period. The difference between the opening and closing balances of our contract assets and deferred revenue primarily results from the timing difference between our performance obligations and the customer’s payment. We receive payments from customers based on the terms established in our contracts, which may vary generally by contract type.

The table below shows movements in the deferred revenue balances (current and noncurrent) for the period:

	Contract liability
Balance – June 30, 2023	$	1,903,001
Amounts billed but not recognized as revenue		537,630
Revenue recognized related to the opening balance of deferred revenue		(360,207	)
Balance – September 30, 2023	$	2,080,424

Our contract assets and liabilities are reported in a net position on a contract-by-contract basis at the end of each reporting period. The difference between the opening and closing balances of our contract assets and deferred revenue primarily results from the timing difference between our performance obligations and the customer’s payment. We receive payments from customers based on the terms established in our contracts, which may vary generally by contract type.

Disaggregation of Revenue

The table below presents disaggregated revenue from contracts with customers by contract-type. We believe this disaggregation best depicts the nature, amount, timing and uncertainty of our revenue and cash flows that may be affected by industry, market, and other economic factors:

	Three Months Ended
	September 30,
	2023		2022
Recurring revenue– subscription and support services	$	5,046,685	$	4,677,977
Non-recurring revenue – setup and training services		13,427		42,500
Total	$	5,060,112	$	4,720,477

Earnings Per Share

Basic net income per share of Common Stock (“Basic EPS”) excludes dilution and is computed by dividing net income applicable to Common Stockholders by the weighted average number of Common Stock outstanding during the period. Diluted net income per share of Common Stock (“Diluted EPS”) reflects the potential dilution that could occur if stock options or other contracts to issue shares of Common Stock were exercised or converted into Common Stock. The computation of Diluted EPS does not assume exercise or conversion of securities that would have an antidilutive effect on net income per share of Common Stock.

For the three months ended September 30, 2023 and 2022, warrants to purchase 23,737 shares of our Common Stock at an exercise price of $10.00 per share were anti-dilutive and not included in the computation of diluted earnings per share because the exercise price of the options was greater than the average price of Common Stock for the quarter.

The following table presents the components of the computation of basic and diluted earnings per share for the periods indicated:

	Three Months Ended
	September 30,
	2023		2022
Numerator
Net income applicable to common shareholders	$	1,231,937	$	1,138,501
Denominator
Weighted average common shares outstanding, basic		18,225,000		18,465,000
Warrants to purchase Common Stock		614,000		288,000
Weighted average common shares outstanding, diluted		18,839,000		18,753,000
Net income per share
Basic	$	0.07	$	0.06
Diluted	$	0.07	$	0.06

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Reclassifications

Certain prior year amounts have been reclassified to conform with the current year’s presentation. These reclassifications have no impact on the previously reported results.

NOTE 3.  EQUITY

Restricted Stock Units	Restricted Stock Units		Weighted Average Grant Date Fair Value ($/share)
Outstanding at June 30, 2023		907,451	$	5.30
Granted		13,010		9.99
Vested and issued		-		-
Forfeited		-		-
Outstanding at September 30, 2023		920,461	$	5.36

As of September 30, 2023, there were 40,004 restricted stock units outstanding that had vested but for which shares of Common Stock had not yet been issued pursuant to the terms of the applicable agreement.

As of September 30, 2023, there was approximately $4.9 million of unrecognized stock-based compensation obligations under our equity compensation plans. The stock-based compensation obligation is in connection with certain employment agreements which have a deferral option at the Board’s discretion. At the end of the deferral period, the stock-based compensation expense associated with the obligation is expected to be recognized on a straight-line basis over a period of three years.

Warrants

Outstanding warrants were issued in connection with private placements of the Company’s Common Stock and with the restructuring of the Series B Preferred that occurred in March of 2018. The following table summarizes information about fixed stock warrants outstanding at September 30, 2023:

Warrants Outstanding at September 30, 2023								Warrants Exercisable at September 30, 2023
Range of exercise prices		Number Outstanding		Weighted average remaining contractual life (years)		Weighted average exercise price		Number exercisable		Weighted average exercise price
$	4.00		1,085,068		2.35	$	4.00		1,085,068	$	4.00
$	10.00		23,737		2.32	$	10.00		23,737	$	10.00
			1,108,805		2.35	$	4.13		1,108,805	$	4.13

During the quarter ended March 31, 2023, the Company’s Board of Directors approved the modification to extend the expiration dates of the Company’s existing January 26, 2023 and February 5, 2023 warrants by an additional three years. Accordingly, all the Company’s outstanding warrants have been extended and are anticipated to expire or be exercised on or before the quarter ending March 31, 2026.

Preferred Stock

The Company’s articles of incorporation currently authorize the issuance of up to 30,000,000 shares of ‘blank check’ preferred stock, par value $0.01 (“Preferred Stock”), with designations, rights, and preferences as may be determined from time to time by the Company’s Board of Directors, of which 700,000 shares are currently designated as Series B Preferred Stock (“Series B Preferred”) and 550,000 shares are designated as Series B-1 Preferred Stock (“Series B-1 Preferred”). Both classes of Series B Preferred Stock pay dividends at a rate of 7% per annum if paid by the Company in cash, or 9% if paid by the Company by the issuance of additional shares of Series B-1 Preferred, or Series B-1 Preferred, as applicable.

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Preferred Redemption

Section 4 of the Company’s First Amended and Restated Certificate of Designation of the Relative Rights, Powers and Preferences of the Series B-1 Preferred Stock, as amended (the “Series B-1 COD”) provides the Company’s Board of Directors with the right to redeem any or all of the outstanding shares of the Company’s Series B-1 Preferred for a cash payment of $10.70 per share at any time upon providing the holders of Series B-1 Preferred at least ten days written notice that sets forth the date on which the redemption will occur (the “Redemption Notice”).

On August 29, 2023, the Board approved the redemption and retirement of its Series B Preferred and Series B-1 Preferred for their stated value, or $10.70 for each share of Preferred Stock, resulting in an aggregate purchase price of $8,964,214 (the “Preferred Redemption”).  The Preferred Redemption is to occur over the next three years.

As of September 30, 2023, a total of 625,375 shares of Series B Preferred and 212,402 shares of Series B-1 Preferred were issued and outstanding.

The following table provides information about the redemption of the Series B Preferred during the three months ended September 30, 2023:

	Series B Preferred
Period (1)	Total Number of Shares Redeemed		Price Paid Per Share		Dollars Expended by Period under the Preferred Redemption		Remaining Amount Available for Future Preferred Redemption
July 1, 2023 – September 30, 2023:		-	$	10.70	$	-	$	8,964,214

⁽¹⁾  We close our books and records on the last calendar day of each month to align our financial closing with our business processes.

The following table provides information about the redemption of the Series B-1 Preferred during the three months ended September 30, 2023:

	Series B-1 Preferred
Period (1)	Total Number of Shares Redeemed		Price Paid Per Share		Dollars Expended by Period under the Preferred Redemption		Remaining Amount Available for Future Preferred Redemption
July 1, 2023 – September 30, 2023:		-	$	10.70	$	-	$	8,964,214

⁽¹⁾  We close our books and records on the last calendar day of each month to align our financial closing with our business processes.

As of September 30, 2023, the Company had not redeemed or retired any shares of Series B Preferred or Series B-1 Preferred.

Share Repurchase Program

On May 9, 2019, our Board of Directors approved the repurchase of up to $4.0 million in shares of our Common Stock, which repurchases may be made in privately negotiated transactions or in the open market at prices per share not exceeding the then-current market prices (the “Share Repurchase Program”). Under the Share Repurchase Program, management has discretion to determine the dollar amount of shares to be repurchased and the timing of any repurchases in compliance with applicable laws and regulations, including Rule 10b-18 of the Exchange Act.

On March 17, 2020, the Board, given the extreme uncertainty due to COVID-19 at the time, suspended the Share Repurchase Program.

On May 18, 2021, our Board of Directors resumed its Share Repurchase Program, and increased the number of shares of Common Stock available to repurchase under the Share Repurchase Program by an additional $4 million bringing the total number of Common Stock authorized to repurchase under the Share Repurchase Program to $8.0 million.

On August 31, 2021, our Board of Directors approved a further increase to its Share Repurchase program to $12.0 million in shares of our Common Stock which added an additional $4 million to the Share Repurchase Program.

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On May 10, 2022, our Board of Directors approved an increase of $9.0 million in the number of shares of Common Stock available to repurchase under the Share Repurchase Program.

Since inception of the Share Repurchase Program through September 30, 2023, a total of $21,000,000 in shares of Common Stock have been approved under the Share Repurchase Program, and 2,052,844 shares of Common Stock have been repurchased at an average purchase price of $6.22, resulting in $8,513,828 remaining available to repurchase under the current Share Repurchase Program. From time-to-time, our Board of Directors may authorize further increases to our Share Repurchase Program. In addition, the Share Repurchase Program may also be suspended for periods of time or discontinued at any time, at the Board’s discretion.

The following table provides information about repurchases of our Common Stock registered pursuant to Section 12 of the Exchange Act, during the three months ended September 30, 2023:

Period (1)	Total Number of Shares Purchased		Average Price Paid Per Share		Dollars Expended by Period Under the Plans or Programs		Remaining Amount Available for Future Share Repurchases Under the Plans or Programs
July 1, 2023 – September 30, 2023:		155,025	$	8.53	$	1,322,082	$	8,513,828

⁽¹⁾  We close our books and records on the last calendar day of each month to align our financial closing with our business processes.

NOTE 4.  RELATED PARTY TRANSACTIONS

During the three months ended September 30, 2023, the Company continued to be a party to a service agreement (the “Service Agreement”) with Fields Management, Inc. (“FMI”), pursuant to which FMI provided certain executive management services to the Company, including designating Mr. Fields to perform the functions of President and Chief Executive Officer for the Company. Mr. Fields, FMI’s designated executive, who also serves as the Company’s Chair of the Board of Directors, controls FMI. The Company had no payables to FMI under the Service Agreement as of September 30, 2023 or September 30, 2022. During the three months ended September 30, 2023 and 2022, the Company paid FMI $231,015 and $231,015, respectively, in connection with the Service Agreement.

NOTE 5.  RECENT ACCOUNTING PRONOUNCEMENTS

The Company has reviewed newly issued accounting pronouncements and concluded that they are either not applicable to its business or that no material effect is expected on its consolidated financial statements as a result of future adoption.

NOTE 6.  SUBSEQUENT EVENTS 

In accordance with the Subsequent Events Topic of the FASB ASC 855, we have evaluated subsequent events through the filing date and determined that no subsequent events occurred that were reasonably expected to impact the consolidated condensed financial statements presented herein.

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ITEM 2.   MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Forward-Looking Statements

This Quarterly Report on Form 10-Q (this “Report”) contains forward-looking statements. The words or phrases “would be”, “will allow”, “intends to”, “will likely result”, “are expected to”, “will continue”, “is anticipated”, “estimate”, “project”, or similar expressions are intended to identify “forward-looking statements”. Actual results could differ materially from those projected in the forward-looking statements as a result of a number of risks and uncertainties, including those risks factors contained in our June 30, 2023 Annual Report on Form 10-K, incorporated by reference herein. Statements made herein are as of the date of the filing of this Report with the Securities and Exchange Commission (“SEC”) and should not be relied upon as of any subsequent date. Unless otherwise required by applicable law, we do not undertake, and specifically disclaim any obligation, to update any forward-looking statements to reflect occurrences, developments, unanticipated events or circumstances after the date of such statement.

Overview

Park City Group, Inc. DBA ReposiTrak, Inc., a Nevada corporation (“ReposiTrak”, “Park City Group”, “We”, “us”, “our” or the “Company”) is a Software-as-a-Service (“SaaS”) which operates a business-to-business (“B2B”) e-commerce, compliance & traceability, and supply chain management platform that partners with retailers, wholesalers, distributors and their product suppliers to (a) help them manage specific programs, such as out-of-stock management and scan-based trading; (b) reduce risk in their supply chain by managing compliance documents and data; ensure compliance with new regulatory requirements supporting traceability; and (c) improve product ordering and forecasting in order to accelerate sales, control risks, and improve supply chain efficiencies.

The Company’s services are grouped in three application suites:

1.	ReposiTrak Compliance Management (“Compliance”) solutions, which helps the Company’s customers vet suppliers and reduce a company’s potential regulatory, legal, and criminal risk from its supply chain partners by providing a way for them to ensure these suppliers are compliant with food safety regulations, such as the Food Safety Modernization Act of 2011 (“FSMA”);
2.	ReposiTrak Traceability Network (“Traceability or RTN”), which helps the Company’s customers comply with federal regulatory requirements of traceability and provides the lowest cost, easiest to use way to manage the capture and sharing of key data elements (KDEs) now required by Section 204d of FSMA 2011 as designated products move through the supply chain at each ‘event’ known as a ‘critical tracking event’ or “CTE”, which includes tracking from farm to shelf; and
3.	ReposiTrak Supply Chain Solutions (“Supply Chain”), which help the Company’s customers to more efficiently manage various interactions with their suppliers. In other words, it provides customers with greater flexibility in sourcing products by enabling them to choose new suppliers and integrate them into their supply chain faster and more cost effectively, and it helps them to manage these relationships more efficiently, enhancing revenue while lowering working capital, labor costs and reducing waste.

The Company’s services are delivered though proprietary software products designed, developed, marketed, and supported by the Company. These products provide visibility and facilitate improved business processes among all key constituents in the supply chain, starting with the retailer and moving backwards to suppliers and eventually to raw material providers.

The Company provides cloud-based applications and services that address e-commerce, supply chain, food safety, compliance, and traceability activities. The principal customers for the Company’s products are household name multi-store food retail chains and restaurants including their suppliers, branded food manufacturers, food wholesalers and distributors, and other food service businesses.

The Company has a hub and spoke business model. The Company is typically engaged by retailers and wholesalers (“Hubs”), which in turn require their suppliers (“Spokes”) to utilize the Company’s services.

The Company is incorporated in the State of Nevada and has three principal subsidiaries: PC Group, Inc., a Utah corporation (98.76% owned) (“PCG Utah”); Park City Group, Inc., a Delaware corporation (100% owned) (“PCG Delaware”); and ReposiTrak (100% owned) (PCG Utah, PCG Delaware, and ReposiTrak are, collectively, the “Subsidiaries”). All intercompany transactions and balances have been eliminated in the Company’s consolidated financial statements, which contain the operating results of the operations. The Company has no business operations separate from the operations conducted through its Subsidiaries.

The Company’s principal executive offices are located at 5282 South Commerce Drive, Suite D292, Murray, Utah 84107. Its telephone number is (435) 645-2000. Its website address is www.repositrak.com. 

Recent Developments

Dividend Payment

On September 19, 2023, the Company’s Board of Directors declared a quarterly cash dividend of $0.015 per share ($0.06 per year), payable to shareholders of record on September 29, 2023, which were paid to shareholders of record on or about November 1, 2023. Based on the closing prices on September 30, 2023, this represented an annual dividend yield of approximately 1.06%. Subsequent quarterly dividends will be paid within 45 days of each record date of December 31, 2023, March 31, 2024, and June 30, 2024,

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Redemption and Retirement of Preferred Stock

On September 12, 2023, the Company announced its plans to commence the redemption and retirement of its Series B Convertible Preferred Stock and Series B-1 Preferred Stock (together, the “Preferred Stock”) for their stated value, or $10.70 for each share of Preferred Stock, resulting in an aggregate purchase price of $8,964,214 (the “Preferred Redemption”).  The Preferred Redemption is to occur over the next three years from September 12, 2023.  As of September 30, 2023, the Company had not redeemed or retired any Preferred Stock.

Global Pandemics, Bank Failures, and Geopolitical Conflicts

The impact of global pandemics, including COVID 19, banking failures, geopolitical conflicts, including the war in Ukraine, creates much uncertainty in the global marketplace. Management continues to monitor the ongoing impact of these events on all aspects of its business, including how they impact its services, customers, employees, vendors, and business partners now and in the future. While these events did not materially adversely affect the Company’s financial results and business operations in the year ended June 30, 2023 and the fiscal quarter ended September 30, 2023, we are unable to predict the impact that these events, including geopolitical conflicts, will have on its future financial position and operating results due to numerous uncertainties.

FSMA Section 204(d)

In 2020, the United States Food & Drug Administration (“FDA”) announced the “New Era of Smarter Food Safety” blueprint. It “outlines achievable goals to enhance traceability, improve predictive analytics, respond more rapidly to outbreaks, address new business models, reduce contamination of food, and foster the development of stronger food safety cultures.” But one particular section of the Food Safety Modernization Act (“FSMA”), Section 204(d) which has to deal with traceability, was left incomplete when the regulation was enacted in 2011. FDA has been working for the last few years to define exactly what traceability means and what is required to comply with that section of the law.

As part of the 2020 “New Era” announcement, FDA published the Food Traceability List or (“FTL”). FDA used a “risk assessment model” to identify 16 of the highest-risk categories to start with. There is not a single grocery retailer who does not sell these items. These 16 categories represent thousands of individual items and FDA has made it clear in its communications the categories on the FTL are only the beginning. FDA states that they would “encourage the voluntary adoption of these practices industry-wide,” which means more categories are expected to be added over time.

On November 7, 2022, FDA announced the final rule on FSMA Section 204(d) and proposes it would become effective 60 days after publication in the Federal Register. The proposed compliance date for all persons subject to the recordkeeping requirements would be 2 years after the effective date of the final regulation.

For traceability, FDA requires the capture, creation and sharing of specific key data elements (“KDE”) at each designated Critical Tracking Event (“CTE”) for every item and every shipment. FDA also requires the data be stored for two years and be retrievable and presented to them within 24 hours upon request. FSMA 204 is ultimately about recording all movement of inventories through the supply chain. The result is an enormous amount of data to manage. At the root, it is a supply chain data management issue, which is ReposiTrak’s core expertise. That’s why we’ve made it our goal to develop a traceability solution that’s easy, inexpensive and exceeds FDA’s requirements with the guidance of industry thought leaders gathered in the Food Traceability Leadership Consortium. As the largest connected network of food suppliers, wholesalers and retailers in the world, the ReposiTrak Traceability Network® is well positioned to provide end-to-end traceability to provide a safer food supply chain, tighten control on food waste and implement a food recall response that saves lives and money.

Results of Operations

Comparison of the Three Months Ended September 30, 2023 to the Three Months Ended September 30, 2022.

Revenue

	Fiscal Quarter Ended September 30,				Variance
	2023		2022		Dollars		Percent
Revenue	$	5,060,112	$	4,720,477	$	339,635		7	%

Revenue was $5,060,112 and $4,720,477 for the three months ended September 30, 2023 and 2022, respectively, a 7% increase year-over-year. The increase in revenue was due to revenue growth in subscription, services and other recurring revenue. This is the result of growing industry and consumer concern of food contaminations and food safety hazards, whether biological, chemical, physical, or allergenic. The risks have elevated regulatory requirements, documentation requisites, and principally “where does your food come from” transparency on grocery retailers and their suppliers.  As more and more retailers, wholesalers and distributors adopt the risk concerns and disclosure requirements, the Company has seen a rising demand for its services.

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Although no assurances can be given, we continue to focus our sales efforts on marketing our software services on a recurring subscription basis and placing less emphasis on transactional revenue. However, we believe there will continue to be a small percentage of customers that will require buying a particular service outright (i.e., a license). We will continue to make our best effort to reduce this non-recurring transactional revenue when we are able.

Cost of Services and Product Support

	Fiscal Quarter Ended September 30,						Variance
	2023			2022			Dollars			Percent
Cost of services and product support	$	766,334		$	832,704		$	(66,370	)		-8	%
Percent of total revenue		15	%		18	%

Cost of services and product support was $766,334 and $832,704 for the three months ended September 30, 2023 and 2022, respectively, an 8% decrease. This $66,370 decrease is primarily the result of decreased salary and support services resulting from the Company’s internal restructuring of managerial positions in effort to increased demand in response to the FSMA 204 initiative.

Sales and Marketing Expense

	Fiscal Quarter Ended September 30,						Variance
	2023			2022			Dollars		Percent
Sales and marketing	$	1,505,501		$	1,200,259		$	305,242		25	%
Percent of total revenue		30	%		25	%

Sales and marketing expense were $1,505,501 and $1,200,259 for the three months ended September 30, 2023 and 2022, respectively, a 25% increase. This increase in sales and marketing expense is primarily the result of an increase in trade show expense, investment in FSMA 204 traceability marketing, and higher sales travel expense. As the pandemic continues to abate, many customers and prospects are returning to the “new normal” requiring in person meetings. The largest contributor to the increase in sales and marketing expense has been an increase in travel cost and trade shows. We believe this trend will continue as many of our trading partners and industry associations will continue to require our assistance in addressing their compliance and supply chain needs.

General and Administrative Expense

	Fiscal Quarter Ended September 30,						Variance
	2023			2022			Dollars		Percent
General and administrative	$	1,279,323		$	1,223,462		$	55,861		5	%
Percent of total revenue		25	%		26	%

General and administrative expense was $1,279,323 and $1,223,462 for the three months ended September 30, 2023 and 2022, respectively, a 5% increase. The increase in general and administrative expense is primarily due to increased salary expense and a rise in general operating costs caused by increased inflation and overall current market conditions.

Depreciation and Amortization Expense

	Fiscal Quarter Ended September 30,						Variance
	2023			2022			Dollars		Percent
Depreciation and amortization	$	308,945		$	236,006		$	72,939		31	%
Percent of total revenue		6	%		5	%

Depreciation and amortization expense was $308,945 and $236,006 for the three months ended September 30, 2023 and 2022, respectively, an increase of 31%. This increase is due to additional assets acquired in the prior fiscal year. Given the rising global hacks on software companies, banks, and financial institutions, we spent approximately $420,000 on security, backup, storage, and redundancy. The upgrades were financed through a leasing agent with an effective APR rate of 4.45%.

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Other Income and Expense

	Fiscal Quarter Ended September 30,						Variance
	2023			2022			Dollars		Percent
Net other income (expense)	$	279,003		$	117,072		$	161,931		138	%
Percent of total revenue		6	%		2	%

Net other income was $279,003 for the three months ended September 30, 2023, compared to net other income of $117,072 for the three months ended September 30, 2022. Other income increased due to an increase in interest income attributable to rising interest rates on fixed income instruments on excess cash.

Preferred Dividends

	Fiscal Quarter Ended September 30,						Variance
	2023			2022			Dollars		Percent
Preferred dividends	$	146,611		$	146,611		$	-		-	%
Percent of total revenue		3	%		3	%

Dividends accrued on the Company’s Series B-1 Preferred was $146,611 for the three months ended September 30, 2023 and for the three months ended September 30, 2022. Dividends remained flat in the comparable periods.

Financial Position, Liquidity and Capital Resources

We believe that our existing cash and short-term investments, together with funds generated from operations, are sufficient to fund operating and investment requirements for at least the next twelve months. Our future capital requirements will depend on many factors, including macroeconomic conditions, our rate of revenue growth, sales and marketing activities, the timing and extent of spending required for research and development efforts and the continuing market acceptance of our products and services.

	As of				Variance
	September 30, 2023		June 30, 2023		Dollars			Percent
Cash and cash equivalents	$	23,697,228	$	23,990,879	$	(293,651	)		-1	%

We have historically funded our operations with cash from operations, equity financings, and borrowings from our existing line of credit with U.S. Bank N.A. (the “Bank”), which was revised on October 6, 2021, and again in 2022.

Cash was $23,697,228 and $23,990,879 at September 30, 2023 and June 30, 2023, respectively. This 1% decrease is primarily the result of the purchase of Common Stock under our Share Repurchase Program and payment of dividends on both the Preferred Stock and Common Stock.

Net Cash Flows from Operating Activities

	Three Months Ended September 30,				Variance
	2023		2022		Dollars			Percent
Cash provided by operating activities	$	1,520,770	$	1,811,475	$	(290,705	)		-16	%

Net cash provided by operating activities is summarized as follows:

	Three Months Ended September 30,
	2023			2022
Net income	$	1,378,548		$	1,285,112
Noncash expense and income, net		484,149			511,194
Net changes in operating assets and liabilities		(341,927	)		15,169
	$	1,520,770		$	1,811,475

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Net cash provided by operating activities for the three months ended September 30, 2023 was $1,520,770 as compared to net cash provided by operating activities of $1,811,475 for the three months ended September 30, 2022. Net cash provided by operating activities decreased 16% due principally to an increase in accounts receivable and a decrease in accounts payable. Noncash expense decreased by $27,045 in the three months ended September 30, 2023, compared to three months ended September 30, 2022 as a result of a decrease in bad debt expense and stock compensation expense offset by an increase in depreciation and amortization.

Net Cash Flows from Investing Activities

	Three Months Ended September 30,					Variance
	2023		2022			Dollars		Percent
Cash used in investing activities	$	-	$	(19,533	)	$	19,533		-100	%

Net cash used in investing activities for the three months ended September 30, 2023 was $0 compared to net cash used in investing activities of $19,533 for the three months ended September 30, 2022. This decrease in cash used in investing activities for the three months ended September 30, 2023 was due to no purchases of property and equipment in the current fiscal quarter.

Net Cash Flows from Financing Activities

	Three Months Ended September 30,						Variance
	2023			2022			Dollars			Percent
Cash used in financing activities	$	(1,814,421	)	$	(1,625,163	)	$	(189,258	)		12	%

Net cash used in financing activities totaled $1,814,421 for the three months ended September 30, 2023, as compared to cash used in financing activities of $1,625,163 for the three months ended September 30, 2022. The increase in net cash used in financing activities is primarily attributable to the payment of Common Stock dividends and the purchase of Common Stock under the Share Repurchase Program offset by decrease in cash payments due to the payoff of our line of credit arrangement with a bank in the prior fiscal quarter.

Liquidity and Working Capital

At September 30, 2023, the Company had positive working capital of $22,917,547, as compared with positive working capital of $23,042,199 at June 30, 2023. This $124,652 decrease in working capital is primarily due to an increase in accounts receivable and decrease in prepaid and other assets offset by an increase in contract liabilities and deferred revenue. Cash and cash equivalents also decreased due to payment of quarterly Common Stock dividends announced in the prior fiscal year.

	As of September 30,		As of June 30,		Variance
	2023		2023		Dollars			Percent
Current assets	$	27,196,488	$	27,274,620	$	(78,132	)		-	%

Current assets totaled $27,196,488 as of September 30, 2023, as compared to $27,274,620 as of June 30, 2023. The decrease in current liabilities is primarily attributable to the decrease in cash, prepaid expense and other current assets offset by an increase in accounts receivables.

	As of September 30,		As of June 30,		Variance
	2023		2023		Change			Percent
Current liabilities	$	4,278,941	$	4,232,421	$	46,520			1	%
Current ratio		6.36		6.44		(0.08	)		-1	%

Current liabilities totaled $4,278,941 as of September 30, 2023 as compared to $4,232,421 as of June 30, 2023. The increase in current liabilities is primarily attributable to the increase in contract liabilities and deferred revenue. As of September 30, 2023, the Company has zero bank debt.

On October 6, 2021, the Company and U.S. Bank N.A. (the “Bank”) executed a Revolving Credit Agreement (the "Revolving Credit Agreement”) and accompanying addendum (the "Addendum"), and Stand-Alone Revolving Note (the "Note" and collectively with the Revolving Credit Agreement and Addendum, the "Credit Agreement"), with an effective date of September 30, 2021. The Credit Agreement replaced the Company’s prior $6.0 million Revolving Credit Agreement and Stand-Alone Revolving Note between the Company and the Bank, as amended and revised on January 9, 2019, and provided the Company with a $10.0 million revolving line of credit that matured on March 31, 2023. The Credit Agreement contained customary affirmative and negative covenants and conditions to borrowing, as well as customary events of default. Among other things, the Company must maintain liquid assets equal to $12 million and maintain a Senior Funded Debt (as defined in the Credit Agreement) to EBITDA Ratio (as defined in the Credit Agreement) of not more than 3:1.

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On April 28, 2023, the Company and the Bank executed an Amendment to the Credit Agreement, with an effective date of March 31, 2023. The new amendment provisions to the existing $10 million facility are (1) the Company will increase its liquidity requirement from $10 million to $12 million. Currently the Company maintains over $22 million in cash and a current ratio of over 6:1; and (2) Draws on the facility accrue interest at the annual rate equal to 1.75% plus the one-month SOFR rate instead of the previous LIBOR rate. As of September 30, 2023, the balance of the facility was zero. The Company had zero bank debt at September 30, 2023.

While no assurances can be given, management currently believes that the Company will continue to increase its cash flow from operations and working capital position in subsequent periods. The Company’s increase in anticipated cash flow from operations and working capital position is expected to be offset by the use of cash required to fund the Company’s quarterly cash dividends of $0.015 per share, announced on September 28, 2022, December 30, 2022, February 10, 2023, March 21, 2023, June 20, 2023 and September 19, 2023, as well as the  redemption and retirement of the Company’s Series B Convertible Preferred Stock and Series B-1 Preferred Stock (together, the “Preferred Stock”) for their stated value, or $10.70 for each share of Preferred Stock, resulting in an aggregate purchase price of $8,964,214 (the “Preferred Redemption”). 

The Preferred Redemption is to occur over the next three years from September 12, 2023. As of September 30, 2023, the Company had not redeemed or retired any shares of Preferred Stock. The Company believes it will have adequate cash resources to fund its operations, satisfy its debt obligations, and fund its anticipated quarterly cash dividends and Preferred Redemption for at least the next 12 months.

Off-Balance Sheet Arrangements

The Company does not have any off-balance sheet arrangements that are reasonably likely to have a current or future effect on our financial condition, revenue, and results of operation, liquidity or capital expenditures.

Contractual Obligations

Total contractual obligations and commercial commitments as of September 30, 2023 are summarized in the following table:

	Operating Leases			Financing Leases
Less than 1 Year	$	73,835		$	225,243
1-3 Years		154,383			82,727
3-5 Years		114,713			-
Total lease payments		342,931			307,970
Less imputed interest		(35,331	)		(11,510	)
Total	$	307,600		$	296,460

Critical Accounting Policies

This Management’s Discussion and Analysis of Financial Condition and Results of Operations discusses the Company’s financial statements, which have been prepared in accordance with U.S. generally accepted accounting principles.

We commenced operations in the software development and professional services business during 1990. The preparation of our financial statements requires management to make estimates and assumptions that affect reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amount of revenue and expense during the reporting period. On an ongoing basis, management evaluates its estimates and assumptions. Management bases its estimates and judgments on historical experience of operations and on various other factors that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.

Management believes the following critical accounting policies, among others, will affect its more significant judgments and estimates used in the preparation of our consolidated financial statements.

Income Taxes

In determining the carrying value of the Company’s net deferred income tax assets, the Company must assess the likelihood of sufficient future taxable income in certain tax jurisdictions, based on estimates and assumptions, to realize the benefit of these assets. If these estimates and assumptions change in the future, the Company may record a reduction in the valuation allowance, resulting in an income tax benefit in the Company’s statements of operations. Management evaluates whether to realize the deferred income tax assets and assesses the valuation allowance quarterly.

17

Goodwill and Other Long-Lived Asset Valuations

Goodwill and other long-lived assets assigned to specific reporting units are reviewed for possible impairment at least annually or more frequently upon the occurrence of an event or when circumstances indicate that a reporting unit’s carrying amount is greater than its fair value. Management reviews the long-lived tangible and intangible assets for impairment when events or changes in circumstances indicate that the carrying value of an asset may not be recoverable. Management evaluates, at each balance sheet date, whether events and circumstances have occurred which indicate possible impairment. The carrying value of a long-lived asset is considered impaired when the anticipated cumulative undiscounted cash flows of the related asset or group of assets is less than the carrying value. In that event, a loss is recognized based on the amount by which the carrying value exceeds the estimated fair market value of the long-lived asset. Economic useful lives of long-lived assets are assessed and adjusted as circumstances dictate.

Revenue Recognition 

Effective July 1, 2018, the Company adopted the Financial Accounting Standards Board’s Accounting Standards Update 2014-09: Revenue from Contracts with Customers (Topic 606), and its related amendments (“ASU 2014-09”). ASU 2014-09 provides a unified model to determine when and how revenue is recognized and enhances certain disclosure around the nature, timing, amount and uncertainty of revenue and cash flows arising from customers.

ASU 2014-09 represents a change in the accounting model utilized for the recognition of revenue and certain expense arising from contracts with customers. The Company adopted ASU 2014-09 using a “modified retrospective” approach and, accordingly, revenue and expense totals for all periods before July 1, 2018 reflect those previously reported under the prior accounting model and have not been restated.

See Note 2 to our Unaudited Consolidated Financial Statements included in Part I, Item 1 of this Report for a full description of the impact of the adoption of new accounting standards on our financial statements. Following the adoption of this guidance, the revenue recognition for our sales arrangements remained materially consistent with our historical practice and there have been no material changes to our critical accounting policies and estimates as compared to our critical accounting policies and estimates included in our Annual Report on Form 10-K for the fiscal year ended June 30, 2023.

Share-Based Compensation

The Company accounts for its share-based compensation to employees and non-employees in accordance with FASB ASC 718, Compensation – Stock Compensation. Stock-based compensation cost is measured at the grant date, based on the estimated fair value of the award, and is recognized as expense over the requisite service or vesting period.

Leases

Effective July 1, 2019, the Company adopted the requirements of Accounting Standards Update No. 2016-02, "Leases (Topic 842)" ("ASU 2016-02"). All amounts and disclosures set forth in this Report have been updated to comply with this new standard with results for reporting periods beginning after July 1, 2019 presented under ASU 2016-02, while prior period amounts and disclosures are not adjusted and continue to be reported under the accounting standards in effect for the prior period.

ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Our business is conducted principally in the United States. As a result, our financial results are not affected by factors such as changes in foreign currency exchange rates or economic conditions in foreign markets. We do not engage in hedging transactions to reduce our exposure to changes in currency exchange rates, although if the geographical scope of our business broadens, we may do so in the future.

Our exposure to risk for changes in interest rates relates primarily to our investments in short-term financial instruments. Investments in both fixed rate and floating rate interest earning instruments carry some interest rate risk. The fair value of fixed rate securities may fall due to a rise in interest rates, while floating rate securities may produce less income than expected if interest rates fall. Partly as a result of this, our future interest income may fall short of expectations due to changes in interest rates or we may suffer losses in principal if we are forced to sell securities that have fallen in estimated fair value due to changes in interest rates. However, as substantially all of our cash consist of bank deposits and short-term money market instruments, we do not expect any material change with respect to our net income as a result of an interest rate change. 

Our exposure to interest rate changes related to borrowing has been limited, and we believe the effect, if any, of near-term changes in interest rates on our financial position, results of operations and cash flows should not be material. At September 30, 2023, our debt portfolio was composed of (1) Bank Line of Credit – SOFR + 1.75%.  The balance is zero.  (2) Leases – Effective APR Fixed is 4.55%. Total lease obligations are on a three-year straight-line basis.  The total cost is less than $400,000.

18

The table that follows presents fair values of principal amounts and weighted average interest rates for our investment portfolio as of September 30, 2023:

Cash:	Aggregate Fair Value		Weighted Average Interest Rate
Cash	$	23,697,228		4.93	%

ITEM 4.  CONTROLS AND PROCEDURES

(a) Evaluation of disclosure controls and procedures. Under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, an evaluation of the effectiveness of the design and operations of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), as of September 30, 2023 was completed. Based on this evaluation, our Chief Executive Officer and Chief Financial Officer believe that our disclosure controls and procedures are effective to ensure that information required to be disclosed in the reports submitted under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms, including to ensure that information required to be disclosed by the Company is accumulated and communicated to management, including the principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure.

(b) Changes in internal controls over financial reporting. The Company’s Chief Executive Officer and Chief Financial Officer have determined that there have been no changes in the Company’s internal control over financial reporting during the period covered by this report identified in connection with the evaluation described in the above paragraph that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

PART II

OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS

We are, from time-to-time, involved in various legal proceedings incidental to the conduct of our business. Historically, the outcome of all such legal proceedings has not, in the aggregate, had a material adverse effect on our business, financial condition, results of operations or liquidity. There is currently no pending or threatened material legal proceeding that, in the opinion of management, could have a material adverse effect on our business or financial condition.

ITEM 1A.  RISK FACTORS

There are no risk factors identified by the Company in addition to the risk factors previously disclosed in Part I, Item 1A, “Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended June 30, 2023.

ITEM 2.  UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

None.

ITEM 3.  DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 5.  OTHER INFORMATION

None.

ITEM 6.  EXHIBITS

31.1	Certification of Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2	Certification of Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1	Certification of Principal Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2	Certification of Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS	Inline XBRL Instance Document
101.SCH	Inline XBRL Taxonomy Extension Schema
101.CAL	Inline XBRL Taxonomy Extension Calculation Linkbase
101.DEF	Inline XBRL Taxonomy Extension Definition Linkbase
101.LAB	Inline XBRL Taxonomy Extension Label Linkbase
101.PRE	Inline XBRL Taxonomy Extension Presentation Linkbase
104	Cover Page Interactive Data File - formatted in Inline XBRL (included as Exhibit 101)

19

SIGNATURES

In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	PARK CITY GROUP, INC.
Date:  November 14, 2023	By:	/s/ Randall K. Fields
		Randall K. Fields
		Chair of the Board and Chief Executive Officer (Principal Executive Officer)

	PARK CITY GROUP, INC.
Date: November 14, 2023	By:	/s/ John R. Merrill
		John R. Merrill
		Chief Financial Officer (Principal Financial Officer & Principal Accounting Officer)

20

EX-31.1

Exhibit 31.1

CERTIFICATION OF PRINCIPAL EXECUTIVE AND FINANCIAL OFFICER

PURSUANT TO EXCHANGE ACT RULE 13A-14(A)

I, Randall K. Fields, certify that:

1.  I have reviewed this quarterly report on Form 10-Q of Park City Group, Inc.;

2.  Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.  Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.  The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under my supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to me by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under my supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financing reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and 

5.  The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent function):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: November 14, 2023	By:	/s/ Randall K. Fields
		Randall K. Fields Chief Executive Officer and Chair of the Board (Principal Executive Officer)

EX-31.2

Exhibit 31.2

CERTIFICATION OF PRINCIPAL EXECUTIVE AND FINANCIAL OFFICER

PURSUANT TO EXCHANGE ACT RULE 13A-14(A)

I, John R. Merrill, certify that:

1.  I have reviewed this quarterly report on Form 10-Q of Park City Group, Inc.;

2.  Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.  Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.  The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under my supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to me by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under my supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financing reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.  The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent function):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. 

Date: November 14, 2023	By:	/s/ John R. Merrill
		John R. Merrill Chief Financial Officer (Principal Financial Officer & Principal Accounting Officer)

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO 18 U.S.C. Sec.1350

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the accompanying Quarterly Report of Park City Group, Inc. (the “Company”) on Form 10-Q for the period ending September 30, 2023 as filed with the Securities and Exchange Commission on or about the date hereof (the “Report”), the undersigned, Randall K. Fields, Principal Executive Officer of the Company, certifies, to my best knowledge and belief, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.

Date: November 14, 2023	By:	/s/ Randall K. Fields
		Randall K. Fields Chief Executive Officer and Chair of the Board (Principal Executive Officer)

EX-32.2

Exhibit 32.2

CERTIFICATION PURSUANT TO 18 U.S.C. Sec.1350

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the accompanying Quarterly Report of Park City Group, Inc. (the “Company”) on Form 10-Q for the period ending September 30, 2023 as filed with the Securities and Exchange Commission on or about the date hereof (the “Report”), the undersigned, John R. Merrill, Principal Financial Officer of the Company, certifies, to my best knowledge and belief, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.

Date: November 14, 2023	By:	/s/ John R. Merrill
		John R. Merrill Chief Financial Officer (Principal Financial Officer & Principal Accounting Officer)

XML

Document And Entity Information - shares	3 Months Ended
	Sep. 30, 2023	Nov. 14, 2023
Document Information [Line Items]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Sep. 30, 2023
Document Transition Report	false
Entity File Number	001-34941
Entity Registrant Name	PARK CITY GROUP, INC.
Entity Incorporation, State or Country Code	NV
Entity Tax Identification Number	37-1454128
Entity Address, Address Line One	5282 South Commerce Drive, Suite D292
Entity Address, City or Town	Murray
Entity Address, State or Province	UT
Entity Address, Postal Zip Code	84107
City Area Code	435
Local Phone Number	645-2000
Title of 12(b) Security	Common stock, par value $0.01 per
Trading Symbol	TRAK
Security Exchange Name	NYSE
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding (in shares)		18,158,205
Entity Central Index Key	0000050471
Current Fiscal Year End Date	--06-30
Document Fiscal Year Focus	2023
Document Fiscal Period Focus	Q1
Amendment Flag	false

XML

Consolidated Condensed Balance Sheets (Unaudited) - USD ($)	Sep. 30, 2023	Jun. 30, 2023
Current Assets
Cash	$ 23,697,228	$ 23,990,879
Receivables, net of allowance for doubtful accounts of $194,656 and $170,103 at September 30, 2023 and June 30, 2023, respectively	3,022,038	2,523,019
Contract asset – unbilled current portion	160,749	186,959
Prepaid expense and other current assets	316,473	573,763
Total Current Assets	27,196,488	27,274,620
Property and equipment, net	844,705	986,300
Other Assets:
Deposits and other assets	22,414	22,414
Prepaid expense – less current portion	21,147	36,282
Contract asset – unbilled long-term portion	108,052	108,052
Operating lease – right-of-use asset	295,967	310,796
Goodwill	20,883,886	20,883,886
Capitalized software costs, net	619,866	698,281
Total Other Assets	22,181,282	22,322,511
Total Assets	50,222,475	50,583,431
Current liabilities
Accounts payable	314,888	431,387
Accrued liabilities	1,608,640	1,620,000
Contract liability – deferred revenue	2,080,424	1,903,001
Operating lease liability – current	60,063	58,771
Notes payable and financing leases – current	214,926	219,262
Total current liabilities	4,278,941	4,232,421
Long-term liabilities
Operating lease liability – less current portion	247,537	263,047
Notes payable and financing leases – less current portion	81,534	206,032
Total liabilities	4,608,012	4,701,500
Commitments and Contingencies
Stockholders’ equity:
Common Stock, $0.01 par value, 50,000,000 shares authorized; 18,171,068 and 18,309,051 issued and outstanding at September 30, 2023 and June 30, 2023, respectively	181,713	183,093
Additional paid-in capital	66,507,428	67,732,887
Accumulated deficit	(21,083,056)	(22,042,427)
Total stockholders’ equity	45,614,463	45,881,931
Total liabilities and stockholders’ equity	50,222,475	50,583,431
Series B Preferred Stock [Member]
Stockholders’ equity:
Preferred Stock	6,254	6,254
Series B-1 Preferred Stock [Member]
Stockholders’ equity:
Preferred Stock	2,124	2,124
Customer Relationships [Member]
Other Assets:
Customer relationships	$ 229,950	$ 262,800

XML

Consolidated Condensed Balance Sheets (Unaudited) (Parentheticals) - USD ($)	Sep. 30, 2023	Jun. 30, 2023
Accounts Receivable, Allowance for Credit Loss, Current	$ 194,656	$ 170,103
Preferred Stock, Par or Stated Value Per Share (in dollars per share)	$ 0.01	$ 0.01
Preferred Stock, Shares Authorized (in shares)	30,000,000	30,000,000
Common Stock, Par or Stated Value Per Share (in dollars per share)	$ 0.01	$ 0.01
Common Stock, Shares Authorized (in shares)	50,000,000	50,000,000
Common Stock, Shares, Issued (in shares)	18,171,068	18,309,051
Common Stock, Shares, Outstanding, Ending Balance (in shares)	18,171,068	18,309,051
Series B Preferred Stock [Member]
Preferred Stock, Shares Authorized (in shares)	700,000	700,000
Preferred Stock, Shares Outstanding (in shares)	625,375	625,375
Preferred Stock, Shares Issued (in shares)	625,375	625,375
Series B-1 Preferred Stock [Member]
Preferred Stock, Shares Authorized (in shares)	550,000	550,000
Preferred Stock, Shares Outstanding (in shares)	212,402	212,402
Preferred Stock, Shares Issued (in shares)	212,402	212,402

XML

Consolidated Condensed Statements of Operations (Unaudited) - USD ($)	3 Months Ended
	Sep. 30, 2023	Sep. 30, 2022
Revenue	$ 5,060,112	$ 4,720,477
Operating expense:
Cost of revenue and product support	766,334	832,704
Sales and marketing	1,505,501	1,200,259
General and administrative	1,279,323	1,223,462
Depreciation and amortization	308,945	236,006
Total operating expense	3,860,103	3,492,431
Income from operations	1,200,009	1,228,046
Other income (expense):
Interest income	258,161	79,092
Interest expense	(6,344)	(24,652)
Unrealized gain (loss) on short term investments	27,186	(7,415)
Other gain (loss)	0	70,047
Income before income taxes	1,479,012	1,345,118
(Provision) for income taxes:	(100,464)	(60,006)
Net income	1,378,548	1,285,112
Dividends on preferred stock	(146,611)	(146,611)
Net income applicable to common shareholders	$ 1,231,937	$ 1,138,501
Weighted average shares, basic (in shares)	18,225,000	18,465,000
Weighted average shares, diluted (in shares)	18,839,000	18,753,000
Basic income per share (in dollars per share)	$ 0.07	$ 0.06
Diluted income per share (in dollars per share)	$ 0.07	$ 0.06

XML

Consolidated Condensed Statements of Cash Flows (Unaudited) - USD ($)	3 Months Ended
	Sep. 30, 2023	Sep. 30, 2022
Cash flows from operating activities:
Net income	$ 1,378,548	$ 1,285,112
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	308,945	236,006
Amortization of operating right of use asset	14,829	14,142
Stock compensation expense	85,375	111,046
Bad debt expense	75,000	150,000
(Increase) decrease in:
Accounts receivables	(547,809)	(255,281)
Long-term receivables, prepaids and other assets	216,340	434,448
Accounts payable	(116,499)	(264,711)
Operating lease liability	(57,164)	(13,003)
Accrued liabilities	(14,218)	(58,182)
Deferred revenue	177,423	171,898
Net cash provided by operating activities	1,520,770	1,811,475
Cash flows from investing activities:
Purchase of property and equipment	0	(19,533)
Net cash provided by (used in) investing activities	0	(19,533)
Cash flows from financing activities:
Proceeds from employee stock plan	57,743	48,903
Net (decrease) increase in lines of credit	0	(1,294,317)
Common stock buy-back/retirement	(1,322,082)	(103,657)
Dividends paid	(421,248)	(146,611)
Payments on notes payable and capital leases	(128,834)	(129,481)
Net cash used in financing activities	(1,814,421)	(1,625,163)
Net increase (decrease) in cash and cash equivalents	(293,651)	166,779
Cash and cash equivalents at beginning of period	23,990,879	21,460,948
Cash and cash equivalents at end of period	23,697,228	21,627,727
Supplemental Disclosure of Cash Flow Information
Cash paid for income taxes	221,661	146,723
Cash paid for interest	2,329	24,653
Cash paid for operating leases	18,141	17,613
Supplemental Disclosure of Non-Cash Investing and Financing Activities
Dividends accrued on preferred stock	146,611	146,611
Common Stock to Pay Accrued Liabilities [Member]
Supplemental Disclosure of Non-Cash Investing and Financing Activities
Common stock to pay accrued liabilities	$ 37,500	$ 76,873

XML

Consolidated Statements of Stockholders' Equity (Deficit) (Unaudited) - USD ($)	Preferred Stock [Member] Series B Preferred Stock [Member]	Preferred Stock [Member] Series B-1 Preferred Stock [Member]	Common Stock [Member]	Additional Paid-in Capital [Member]	Retained Earnings [Member]	Total
Balance (in shares) at Jun. 30, 2022	625,375	212,402	18,460,538
Balance at Jun. 30, 2022	$ 6,254	$ 2,124	$ 184,608	$ 68,653,361	$ (25,943,287)	$ 42,903,060
Accrued compensation (in shares)	0	0	15,603
Accrued compensation	$ 0	$ 0	$ 156	76,717	0	76,873
Employee stock plan (in shares)	0	0	13,064
Employee stock plan	$ 0	$ 0	$ 131	48,772	0	48,903
Stock buyback (in shares)	0	0	(20,859)
Stock buyback	$ 0	$ 0	$ (209)	(103,448)	0	(103,657)
Preferred Dividends-Declared	0	0	0	0	(146,611)	(146,611)
Common Stock Dividends-Declared			0	0	(277,162)	(277,162)
Net income	$ 0	$ 0	$ 0	0	1,285,112	1,285,112
Balance (in shares) at Sep. 30, 2022	625,375	212,402	18,468,346
Balance at Sep. 30, 2022	$ 6,254	$ 2,124	$ 184,686	68,675,402	(25,081,948)	43,786,518
Balance (in shares) at Jun. 30, 2023	625,375	212,402	18,309,051
Balance at Jun. 30, 2023	$ 6,254	$ 2,124	$ 183,093	67,732,887	(22,042,427)	45,881,931
Accrued compensation (in shares)			3,716
Accrued compensation			$ 37	37,463	0	37,500
Employee stock plan (in shares)			13,326
Employee stock plan			$ 133	57,610	0	$ 57,743
Stock buyback (in shares)			(155,025)			(155,025)	[1]
Stock buyback			$ (1,550)	(1,320,532)	0	$ (1,322,082)
Preferred Dividends-Declared			0	0	(146,611)	(146,611)
Common Stock Dividends-Declared			0	0	(272,566)	(272,566)
Net income			$ 0	0	1,378,548	1,378,548
Balance (in shares) at Sep. 30, 2023	625,375	212,402	18,171,068
Balance at Sep. 30, 2023	$ 6,254	$ 2,124	$ 181,713	$ 66,507,428	$ (21,083,056)	$ 45,614,463

[1] We close our books and records on the last calendar day of each month to align our financial closing with our business processes.

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Note 1 - Overview of Operations and Basis for Presentation

3 Months Ended

Sep. 30, 2023

Notes to Financial Statements

Business Description and Basis of Presentation [Text Block]

NOTE 1.  OVERVIEW OF OPERATIONS AND BASIS FOR PRESENTATION

Overview

Park City Group, Inc. dba ReposiTrak, Inc., a Nevada corporation (“ReposiTrak”, “Park City Group”, “We”, “us”, “our” or the “Company”) is a Software-as-a-Service (“SaaS”) which operates a business-to-business (“B2B”) e-commerce, compliance & traceability, and supply chain management platform that partners with retailers, wholesalers, distributors and their product suppliers to (a) help them manage specific programs, such as out-of-stock management and scan-based trading; (b) reduce risk in their supply chain by managing compliance documents and data; ensure compliance with new regulatory requirements supporting traceability; and (c) improve product ordering and forecasting in order to accelerate sales, control risks, and improve supply chain efficiencies.

The Company’s services are grouped in three application suites:

1.	ReposiTrak Compliance Management (“Compliance”) solutions, which helps the Company’s customers vet suppliers and reduce a company’s potential regulatory, legal, and criminal risk from its supply chain partners by providing a way for them to ensure these suppliers are compliant with food safety regulations, such as the Food Safety Modernization Act of 2011 (“FSMA”);
2.	ReposiTrak Traceability Network (“Traceability or RTN”), which helps the Company’s customers comply with federal regulatory requirements of traceability and provides the lowest cost, easiest to use way to manage the capture and sharing of key data elements (“KDEs”) now required by Section 204d of FSMA 2011 as designated products move through the supply chain at each ‘event’ known as a ‘critical tracking event’ or “CTE”, which includes tracking from farm to shelf; and
3.	ReposiTrak Supply Chain Solutions (“Supply Chain”), which help the Company’s customers to more efficiently manage various interactions with their suppliers. In other words, it provides customers with greater flexibility in sourcing products by enabling them to choose new suppliers and integrate them into their supply chain faster and more cost effectively, and it helps them to manage these relationships more efficiently, enhancing revenue while lowering working capital, labor costs and reducing waste.

The Company’s services are delivered though proprietary software products designed, developed, marketed, and supported by the Company. These products provide visibility and facilitate improved business processes among all key constituents in the supply chain, starting with the retailer and moving backwards to suppliers and eventually to raw material providers.

The Company provides cloud-based applications and services that address e-commerce, supply chain, food safety, compliance and traceability activities. The principal customers for the Company’s products are household name multi-store food retail chains and restaurants including their suppliers, branded food manufacturers, food wholesalers and distributors, and other food service businesses.

The Company has a hub and spoke business model. The Company is typically engaged by retailers and wholesalers (“Hubs”), which in turn require their suppliers (“Spokes”) to utilize the Company’s services.

The Company is incorporated in the State of Nevada and has three principal subsidiaries: PC Group, Inc., a Utah corporation (98.76% owned) (“PCG Utah”); Park City Group, Inc., a Delaware corporation (100% owned) (“PCG Delaware”); and ReposiTrak (100% owned) (PCG Utah, PCG Delaware, and ReposiTrak are, collectively, the “Subsidiaries”). All intercompany transactions and balances have been eliminated in the Company’s consolidated financial statements, which contain the operating results of the operations. The Company has no business operations separate from the operations conducted through its Subsidiaries.

The Company’s principal executive offices are located at 5282 South Commerce Drive, Suite D292, Murray, Utah 84107. Its telephone number is (435) 645-2000. Its website address is www.repositrak.com. 

Basis of Financial Statement Presentation

The interim financial information of the Company as of September 30, 2023 and for the three months ended September 30, 2023 is unaudited, and the balance sheet as of June 30, 2023 is derived from audited financial statements. The accompanying condensed consolidated financial statements have been prepared in accordance with United States generally accepted accounting principles ("U.S. GAAP") for interim financial statements. Accordingly, they omit or condense notes and certain other information normally included in financial statements prepared in accordance with U.S. GAAP. The accounting policies followed for quarterly financial reporting conform with the accounting policies disclosed in the Notes to Financial Statements included in our Annual Report on Form 10-K for the year ended June 30, 2023. In the opinion of management, all adjustments necessary for a fair presentation of the financial information for the interim periods reported have been made. All such adjustments are of a normal recurring nature. The results of operations for the three months ended September 30, 2023 are not necessarily indicative of the results that can be expected for the fiscal year ending June 30, 2024. The unaudited condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and the notes thereto included in our Annual Report on Form 10-K for the year ended June 30, 2023.

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Note 2 - Significant Accounting Policies

3 Months Ended

Sep. 30, 2023

Notes to Financial Statements

Significant Accounting Policies [Text Block]

NOTE 2.  SIGNIFICANT ACCOUNTING POLICIES

Principles of Consolidation

The financial statements presented herein reflect the consolidated financial position of Park City Group, Inc. and our subsidiaries. All inter-company transactions and balances have been eliminated in consolidation.

Use of Estimates

The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that materially affect the amounts reported in the consolidated financial statements. Actual results could differ from these estimates. The methods, estimates, and judgments the Company uses in applying its most critical accounting policies have a significant impact on the results it reports in its financial statements. The U.S. Securities and Exchange Commission (“SEC”) has defined the most critical accounting policies as those that are most important to the portrayal of the Company’s financial condition and results and require the Company to make its most difficult and subjective judgments, often because of the need to make estimates of matters that are inherently uncertain. Based on this definition, the Company’s most critical accounting policies include revenue recognition, goodwill, other long-lived asset valuations, income taxes, stock-based compensation, and capitalization of software development costs.

Revenue Recognition

The Company recognizes revenue as it transfers control of deliverables (products, solutions and services) to its customers in an amount reflecting the consideration to which it expects to be entitled. To recognize revenue, the Company applies the following five step approach: (1) identify the contract with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to the performance obligations in the contract; and (5) recognize revenue when a performance obligation is satisfied. The Company accounts for a contract based on the terms and conditions the parties agree to, if the contract has commercial substance and if collectability of consideration is probable. The Company applies judgment in determining the customer’s ability and intention to pay, which is based on a variety of factors including the customer’s historical payment experience.

The Company may enter into arrangements that consist of multiple performance obligations. Such arrangements may include any combination of its deliverables. To the extent a contract includes multiple promised deliverables, the Company applies judgment to determine whether promised deliverables are capable of being distinct and are distinct in the context of the contract. If these criteria are not met, the promised deliverables are accounted for as a combined performance obligation. For arrangements with multiple distinct performance obligations, the Company allocates consideration among the performance obligations based on their relative standalone selling price. Standalone selling price is the price at which the Company would sell a promised good or service separately to the customer. When not directly observable, the Company typically estimates standalone selling price by using the expected cost plus a margin approach. The Company typically establishes a standalone selling price range for its deliverables, which is reassessed on a periodic basis or when facts and circumstances change.

For performance obligations where control is transferred over time, revenue is recognized based on the extent of progress towards completion of the performance obligation. The selection of the method to measure progress towards completion requires judgment and is based on the nature of the deliverables to be provided. Revenue related to fixed-price contracts for application development and systems integration services, consulting or other technology services is recognized as the service is performed using the output method, under which the total value of revenue is recognized based on each contract’s deliverable(s) as they are completed and when value is transferred to a customer. Revenue related to fixed-price application maintenance, testing and business process services is recognized based on our right to invoice for services performed for contracts in which the invoicing is representative of the value being delivered, in accordance with the practical expedient in FASB ASC Topic 606, Revenue from Contracts with Customers (“Topic 606”), paragraph 606-10-55-18 (“ASC 606-10-55-18”).

If the Company’s invoicing is not consistent with the value delivered, revenue is recognized as the service is performed based on the method described above. The output method measures the results achieved and value transferred to a customer, which is updated as the project progresses to reflect the latest available information; such estimates and changes in estimates involve the use of judgment. The cumulative impact of any revision in estimates is reflected in the financial reporting period in which the change in estimate becomes known and any anticipated losses on contracts are recognized immediately. Revenue related to fixed-price hosting and infrastructure services is recognized based on the Company’s right to invoice for services performed for contracts in which the invoicing is representative of the value being delivered, in accordance with the practical expedient in ASC 606-10-55-18. If the Company’s invoicing is not consistent with value delivered, revenue is recognized on a straight-line basis unless revenue is earned and obligations are fulfilled in a different pattern. The revenue recognition method applied to the types of contracts described above provides the most faithful depiction of performance towards satisfaction of the Company’s performance obligations.

Revenue related to the Company’s software license arrangements that do not require significant modification or customization of the underlying software is recognized when the software is delivered as control is transferred at a point in time. For software license arrangements that require significant functionality enhancements or modification of the software, revenue for the software license and related services is recognized as the services are performed in accordance with the methods described above. In software hosting arrangements, the rights provided to the customer, such as ownership of a license, contract termination provisions and the feasibility of the client to operate the software, are considered in determining whether the arrangement includes a license or a service. Revenue related to software maintenance and support is generally recognized on a straight-line basis over the contract period.

Management expects that incremental commission fees paid as a result of obtaining a contract are recoverable and therefore the Company capitalized them as contract costs. The Company recognizes the incremental costs of obtaining contracts as an expense when incurred if the amortization period of the asset that the Company otherwise would have recognized is one year or less.

Revenue related to transaction-based or volume-based contracts is recognized over the period the services are provided in a manner that corresponds with the value transferred to the customer to-date relative to the remaining services to be provided.

From time to time, the Company may enter into arrangements with third party suppliers to resell products or services. In such cases, the Company evaluates whether the Company is the principal (i.e., report revenue on a gross basis) or agent (i.e., report revenue on a net basis). In doing so, the Company first evaluates whether it controls the good or service before it is transferred to the customer. If the Company controls the good or service before it is transferred to the customer, the Company is the principal; if not, the Company is the agent. Determining whether the Company controls the good or service before it is transferred to the customer may require judgment.

The Company provides customers with assurance that the related deliverable will function as the parties intended because it complies with agreed-upon specifications. General updates or patch fixes are not considered an additional performance obligation in the contract.

Variable consideration is estimated using either the sum of probability weighted amounts in a range of possible consideration amounts (expected value), or the single most likely amount in a range of possible consideration amounts (most likely amount), depending on which method better predicts the amount of consideration to which we may be entitled. The Company includes in the transaction price variable consideration only to the extent it is probable that a significant reversal of revenue recognized will not occur when the uncertainty associated with the variable consideration is resolved. The Company’s estimates of variable consideration and determination of whether to include estimated amounts in the transaction price may involve judgment and is based largely on an assessment of its anticipated performance and all information that is reasonably available to the Company.

The Company assesses the timing of the transfer of goods or services to the customer as compared to the timing of payments to determine whether a significant financing component exists. As a practical expedient, the Company does not assess the existence of a significant financing component when the difference between payment and transfer of deliverables is a year or less. If the difference in timing arises for reasons other than the provision of finance to either the customer or us, no financing component is deemed to exist. The primary purpose of the Company’s invoicing terms is to provide customers with simplified and predictable ways of purchasing its services, not to receive or provide financing from or to customers. The Company does not consider set up or transition fees paid upfront by its customers to represent a financing component, as such fees are required to encourage customer commitment to the project and protect us from early termination of the contract.

Trade Accounts Receivable and Contract Balances

We classify our right to consideration in exchange for deliverables as either a receivable or a contract asset (unbilled receivable). A receivable is a right to consideration that is unconditional (i.e. only the passage of time is required before payment is due). For example, we recognize a receivable for revenue related to our transaction or volume-based contracts when earned regardless of whether amounts have been billed. We present such receivables in trade accounts receivable, net in our consolidated statements of financial position at their net estimated realizable value. We maintain an allowance for doubtful accounts to provide for the estimated amount of receivables that may not be collected. The allowance is based upon an assessment of customer creditworthiness, historical payment experience, the age of outstanding receivables, judgment, and other applicable factors.

A contract asset is a right to consideration that is conditional upon factors other than the passage of time. Contract assets are presented in current and other assets in our consolidated balance sheets and primarily relate to unbilled amounts on fixed-price contracts utilizing the output method of revenue recognition. The table below shows movements in contract assets:

	Contract assets
Balance – June 30, 2023	$	295,011
Revenue recognized during the period but not billed		-
Amounts reclassified to accounts receivable		(10,000	)
Other		(16,210	)
Balance – September 30, 2023	$	268,801	(1)

⁽¹⁾ Contract asset balances for September 30, 2023 include a current and a long-term contract asset of $160,749 and $108,052, respectively.

Our contract assets and liabilities are reported at the end of each reporting period. The difference between the opening and closing balances of our contract assets and deferred revenue primarily results from the timing difference between our performance obligations and the customer’s payment. We receive payments from customers based on the terms established in our contracts, which may vary generally by contract type.

The table below shows movements in the deferred revenue balances (current and noncurrent) for the period:

	Contract liability
Balance – June 30, 2023	$	1,903,001
Amounts billed but not recognized as revenue		537,630
Revenue recognized related to the opening balance of deferred revenue		(360,207	)
Balance – September 30, 2023	$	2,080,424

Our contract assets and liabilities are reported in a net position on a contract-by-contract basis at the end of each reporting period. The difference between the opening and closing balances of our contract assets and deferred revenue primarily results from the timing difference between our performance obligations and the customer’s payment. We receive payments from customers based on the terms established in our contracts, which may vary generally by contract type.

Disaggregation of Revenue

The table below presents disaggregated revenue from contracts with customers by contract-type. We believe this disaggregation best depicts the nature, amount, timing and uncertainty of our revenue and cash flows that may be affected by industry, market, and other economic factors:

	Three Months Ended
	September 30,
	2023		2022
Recurring revenue– subscription and support services	$	5,046,685	$	4,677,977
Non-recurring revenue – setup and training services		13,427		42,500
Total	$	5,060,112	$	4,720,477

Earnings Per Share

Basic net income per share of Common Stock (“Basic EPS”) excludes dilution and is computed by dividing net income applicable to Common Stockholders by the weighted average number of Common Stock outstanding during the period. Diluted net income per share of Common Stock (“Diluted EPS”) reflects the potential dilution that could occur if stock options or other contracts to issue shares of Common Stock were exercised or converted into Common Stock. The computation of Diluted EPS does not assume exercise or conversion of securities that would have an antidilutive effect on net income per share of Common Stock.

For the three months ended September 30, 2023 and 2022, warrants to purchase 23,737 shares of our Common Stock at an exercise price of $10.00 per share were anti-dilutive and not included in the computation of diluted earnings per share because the exercise price of the options was greater than the average price of Common Stock for the quarter.

The following table presents the components of the computation of basic and diluted earnings per share for the periods indicated:

	Three Months Ended
	September 30,
	2023		2022
Numerator
Net income applicable to common shareholders	$	1,231,937	$	1,138,501
Denominator
Weighted average common shares outstanding, basic		18,225,000		18,465,000
Warrants to purchase Common Stock		614,000		288,000
Weighted average common shares outstanding, diluted		18,839,000		18,753,000
Net income per share
Basic	$	0.07	$	0.06
Diluted	$	0.07	$	0.06

Reclassifications

Certain prior year amounts have been reclassified to conform with the current year’s presentation. These reclassifications have no impact on the previously reported results.

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Note 3 - Equity

3 Months Ended

Sep. 30, 2023

Notes to Financial Statements

Equity [Text Block]

NOTE 3.  EQUITY

Restricted Stock Units	Restricted Stock Units		Weighted Average Grant Date Fair Value ($/share)
Outstanding at June 30, 2023		907,451	$	5.30
Granted		13,010		9.99
Vested and issued		-		-
Forfeited		-		-
Outstanding at September 30, 2023		920,461	$	5.36

As of September 30, 2023, there were 40,004 restricted stock units outstanding that had vested but for which shares of Common Stock had not yet been issued pursuant to the terms of the applicable agreement.

As of September 30, 2023, there was approximately $4.9 million of unrecognized stock-based compensation obligations under our equity compensation plans. The stock-based compensation obligation is in connection with certain employment agreements which have a deferral option at the Board’s discretion. At the end of the deferral period, the stock-based compensation expense associated with the obligation is expected to be recognized on a straight-line basis over a period of three years.

Warrants

Outstanding warrants were issued in connection with private placements of the Company’s Common Stock and with the restructuring of the Series B Preferred that occurred in March of 2018. The following table summarizes information about fixed stock warrants outstanding at September 30, 2023:

Warrants Outstanding at September 30, 2023								Warrants Exercisable at September 30, 2023
Range of exercise prices		Number Outstanding		Weighted average remaining contractual life (years)		Weighted average exercise price		Number exercisable		Weighted average exercise price
$	4.00		1,085,068		2.35	$	4.00		1,085,068	$	4.00
$	10.00		23,737		2.32	$	10.00		23,737	$	10.00
			1,108,805		2.35	$	4.13		1,108,805	$	4.13

During the quarter ended March 31, 2023, the Company’s Board of Directors approved the modification to extend the expiration dates of the Company’s existing January 26, 2023 and February 5, 2023 warrants by an additional three years. Accordingly, all the Company’s outstanding warrants have been extended and are anticipated to expire or be exercised on or before the quarter ending March 31, 2026.

Preferred Stock

The Company’s articles of incorporation currently authorize the issuance of up to 30,000,000 shares of ‘blank check’ preferred stock, par value $0.01 (“Preferred Stock”), with designations, rights, and preferences as may be determined from time to time by the Company’s Board of Directors, of which 700,000 shares are currently designated as Series B Preferred Stock (“Series B Preferred”) and 550,000 shares are designated as Series B-1 Preferred Stock (“Series B-1 Preferred”). Both classes of Series B Preferred Stock pay dividends at a rate of 7% per annum if paid by the Company in cash, or 9% if paid by the Company by the issuance of additional shares of Series B-1 Preferred, or Series B-1 Preferred, as applicable.

Preferred Redemption

Section 4 of the Company’s First Amended and Restated Certificate of Designation of the Relative Rights, Powers and Preferences of the Series B-1 Preferred Stock, as amended (the “Series B-1 COD”) provides the Company’s Board of Directors with the right to redeem any or all of the outstanding shares of the Company’s Series B-1 Preferred for a cash payment of $10.70 per share at any time upon providing the holders of Series B-1 Preferred at least ten days written notice that sets forth the date on which the redemption will occur (the “Redemption Notice”).

On August 29, 2023, the Board approved the redemption and retirement of its Series B Preferred and Series B-1 Preferred for their stated value, or $10.70 for each share of Preferred Stock, resulting in an aggregate purchase price of $8,964,214 (the “Preferred Redemption”).  The Preferred Redemption is to occur over the next three years.

As of September 30, 2023, a total of 625,375 shares of Series B Preferred and 212,402 shares of Series B-1 Preferred were issued and outstanding.

The following table provides information about the redemption of the Series B Preferred during the three months ended September 30, 2023:

	Series B Preferred
Period (1)	Total Number of Shares Redeemed		Price Paid Per Share		Dollars Expended by Period under the Preferred Redemption		Remaining Amount Available for Future Preferred Redemption
July 1, 2023 – September 30, 2023:		-	$	10.70	$	-	$	8,964,214

⁽¹⁾  We close our books and records on the last calendar day of each month to align our financial closing with our business processes.

The following table provides information about the redemption of the Series B-1 Preferred during the three months ended September 30, 2023:

	Series B-1 Preferred
Period (1)	Total Number of Shares Redeemed		Price Paid Per Share		Dollars Expended by Period under the Preferred Redemption		Remaining Amount Available for Future Preferred Redemption
July 1, 2023 – September 30, 2023:		-	$	10.70	$	-	$	8,964,214

⁽¹⁾  We close our books and records on the last calendar day of each month to align our financial closing with our business processes.

As of September 30, 2023, the Company had not redeemed or retired any shares of Series B Preferred or Series B-1 Preferred.

Share Repurchase Program

On May 9, 2019, our Board of Directors approved the repurchase of up to $4.0 million in shares of our Common Stock, which repurchases may be made in privately negotiated transactions or in the open market at prices per share not exceeding the then-current market prices (the “Share Repurchase Program”). Under the Share Repurchase Program, management has discretion to determine the dollar amount of shares to be repurchased and the timing of any repurchases in compliance with applicable laws and regulations, including Rule 10b-18 of the Exchange Act.

On March 17, 2020, the Board, given the extreme uncertainty due to COVID-19 at the time, suspended the Share Repurchase Program.

On May 18, 2021, our Board of Directors resumed its Share Repurchase Program, and increased the number of shares of Common Stock available to repurchase under the Share Repurchase Program by an additional $4 million bringing the total number of Common Stock authorized to repurchase under the Share Repurchase Program to $8.0 million.

On August 31, 2021, our Board of Directors approved a further increase to its Share Repurchase program to $12.0 million in shares of our Common Stock which added an additional $4 million to the Share Repurchase Program.

On May 10, 2022, our Board of Directors approved an increase of $9.0 million in the number of shares of Common Stock available to repurchase under the Share Repurchase Program.

Since inception of the Share Repurchase Program through September 30, 2023, a total of $21,000,000 in shares of Common Stock have been approved under the Share Repurchase Program, and 2,052,844 shares of Common Stock have been repurchased at an average purchase price of $6.22, resulting in $8,513,828 remaining available to repurchase under the current Share Repurchase Program. From time-to-time, our Board of Directors may authorize further increases to our Share Repurchase Program. In addition, the Share Repurchase Program may also be suspended for periods of time or discontinued at any time, at the Board’s discretion.

The following table provides information about repurchases of our Common Stock registered pursuant to Section 12 of the Exchange Act, during the three months ended September 30, 2023:

Period (1)	Total Number of Shares Purchased		Average Price Paid Per Share		Dollars Expended by Period Under the Plans or Programs		Remaining Amount Available for Future Share Repurchases Under the Plans or Programs
July 1, 2023 – September 30, 2023:		155,025	$	8.53	$	1,322,082	$	8,513,828

⁽¹⁾  We close our books and records on the last calendar day of each month to align our financial closing with our business processes.

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Note 4 - Related Party Transactions

3 Months Ended

Sep. 30, 2023

Notes to Financial Statements

Related Party Transactions Disclosure [Text Block]

NOTE 4.  RELATED PARTY TRANSACTIONS

During the three months ended September 30, 2023, the Company continued to be a party to a service agreement (the “Service Agreement”) with Fields Management, Inc. (“FMI”), pursuant to which FMI provided certain executive management services to the Company, including designating Mr. Fields to perform the functions of President and Chief Executive Officer for the Company. Mr. Fields, FMI’s designated executive, who also serves as the Company’s Chair of the Board of Directors, controls FMI. The Company had no payables to FMI under the Service Agreement as of September 30, 2023 or September 30, 2022. During the three months ended September 30, 2023 and 2022, the Company paid FMI $231,015 and $231,015, respectively, in connection with the Service Agreement.

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Note 5 - Recent Accounting Pronouncements

3 Months Ended

Sep. 30, 2023

Notes to Financial Statements

Accounting Standards Update and Change in Accounting Principle [Text Block]

NOTE 5.  RECENT ACCOUNTING PRONOUNCEMENTS

The Company has reviewed newly issued accounting pronouncements and concluded that they are either not applicable to its business or that no material effect is expected on its consolidated financial statements as a result of future adoption.

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Note 6 - Subsequent Events

3 Months Ended

Sep. 30, 2023

Notes to Financial Statements

Subsequent Events [Text Block]

NOTE 6.  SUBSEQUENT EVENTS 

In accordance with the Subsequent Events Topic of the FASB ASC 855, we have evaluated subsequent events through the filing date and determined that no subsequent events occurred that were reasonably expected to impact the consolidated condensed financial statements presented herein.

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Significant Accounting Policies (Policies)

3 Months Ended

Sep. 30, 2023

Accounting Policies [Abstract]

Consolidation, Policy [Policy Text Block]

Principles of Consolidation

The financial statements presented herein reflect the consolidated financial position of Park City Group, Inc. and our subsidiaries. All inter-company transactions and balances have been eliminated in consolidation.

Use of Estimates, Policy [Policy Text Block]

Use of Estimates

The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that materially affect the amounts reported in the consolidated financial statements. Actual results could differ from these estimates. The methods, estimates, and judgments the Company uses in applying its most critical accounting policies have a significant impact on the results it reports in its financial statements. The U.S. Securities and Exchange Commission (“SEC”) has defined the most critical accounting policies as those that are most important to the portrayal of the Company’s financial condition and results and require the Company to make its most difficult and subjective judgments, often because of the need to make estimates of matters that are inherently uncertain. Based on this definition, the Company’s most critical accounting policies include revenue recognition, goodwill, other long-lived asset valuations, income taxes, stock-based compensation, and capitalization of software development costs.

Revenue [Policy Text Block]

Revenue Recognition

The Company recognizes revenue as it transfers control of deliverables (products, solutions and services) to its customers in an amount reflecting the consideration to which it expects to be entitled. To recognize revenue, the Company applies the following five step approach: (1) identify the contract with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to the performance obligations in the contract; and (5) recognize revenue when a performance obligation is satisfied. The Company accounts for a contract based on the terms and conditions the parties agree to, if the contract has commercial substance and if collectability of consideration is probable. The Company applies judgment in determining the customer’s ability and intention to pay, which is based on a variety of factors including the customer’s historical payment experience.

The Company may enter into arrangements that consist of multiple performance obligations. Such arrangements may include any combination of its deliverables. To the extent a contract includes multiple promised deliverables, the Company applies judgment to determine whether promised deliverables are capable of being distinct and are distinct in the context of the contract. If these criteria are not met, the promised deliverables are accounted for as a combined performance obligation. For arrangements with multiple distinct performance obligations, the Company allocates consideration among the performance obligations based on their relative standalone selling price. Standalone selling price is the price at which the Company would sell a promised good or service separately to the customer. When not directly observable, the Company typically estimates standalone selling price by using the expected cost plus a margin approach. The Company typically establishes a standalone selling price range for its deliverables, which is reassessed on a periodic basis or when facts and circumstances change.

For performance obligations where control is transferred over time, revenue is recognized based on the extent of progress towards completion of the performance obligation. The selection of the method to measure progress towards completion requires judgment and is based on the nature of the deliverables to be provided. Revenue related to fixed-price contracts for application development and systems integration services, consulting or other technology services is recognized as the service is performed using the output method, under which the total value of revenue is recognized based on each contract’s deliverable(s) as they are completed and when value is transferred to a customer. Revenue related to fixed-price application maintenance, testing and business process services is recognized based on our right to invoice for services performed for contracts in which the invoicing is representative of the value being delivered, in accordance with the practical expedient in FASB ASC Topic 606, Revenue from Contracts with Customers (“Topic 606”), paragraph 606-10-55-18 (“ASC 606-10-55-18”).

If the Company’s invoicing is not consistent with the value delivered, revenue is recognized as the service is performed based on the method described above. The output method measures the results achieved and value transferred to a customer, which is updated as the project progresses to reflect the latest available information; such estimates and changes in estimates involve the use of judgment. The cumulative impact of any revision in estimates is reflected in the financial reporting period in which the change in estimate becomes known and any anticipated losses on contracts are recognized immediately. Revenue related to fixed-price hosting and infrastructure services is recognized based on the Company’s right to invoice for services performed for contracts in which the invoicing is representative of the value being delivered, in accordance with the practical expedient in ASC 606-10-55-18. If the Company’s invoicing is not consistent with value delivered, revenue is recognized on a straight-line basis unless revenue is earned and obligations are fulfilled in a different pattern. The revenue recognition method applied to the types of contracts described above provides the most faithful depiction of performance towards satisfaction of the Company’s performance obligations.

Revenue related to the Company’s software license arrangements that do not require significant modification or customization of the underlying software is recognized when the software is delivered as control is transferred at a point in time. For software license arrangements that require significant functionality enhancements or modification of the software, revenue for the software license and related services is recognized as the services are performed in accordance with the methods described above. In software hosting arrangements, the rights provided to the customer, such as ownership of a license, contract termination provisions and the feasibility of the client to operate the software, are considered in determining whether the arrangement includes a license or a service. Revenue related to software maintenance and support is generally recognized on a straight-line basis over the contract period.

Management expects that incremental commission fees paid as a result of obtaining a contract are recoverable and therefore the Company capitalized them as contract costs. The Company recognizes the incremental costs of obtaining contracts as an expense when incurred if the amortization period of the asset that the Company otherwise would have recognized is one year or less.

Revenue related to transaction-based or volume-based contracts is recognized over the period the services are provided in a manner that corresponds with the value transferred to the customer to-date relative to the remaining services to be provided.

From time to time, the Company may enter into arrangements with third party suppliers to resell products or services. In such cases, the Company evaluates whether the Company is the principal (i.e., report revenue on a gross basis) or agent (i.e., report revenue on a net basis). In doing so, the Company first evaluates whether it controls the good or service before it is transferred to the customer. If the Company controls the good or service before it is transferred to the customer, the Company is the principal; if not, the Company is the agent. Determining whether the Company controls the good or service before it is transferred to the customer may require judgment.

The Company provides customers with assurance that the related deliverable will function as the parties intended because it complies with agreed-upon specifications. General updates or patch fixes are not considered an additional performance obligation in the contract.

Variable consideration is estimated using either the sum of probability weighted amounts in a range of possible consideration amounts (expected value), or the single most likely amount in a range of possible consideration amounts (most likely amount), depending on which method better predicts the amount of consideration to which we may be entitled. The Company includes in the transaction price variable consideration only to the extent it is probable that a significant reversal of revenue recognized will not occur when the uncertainty associated with the variable consideration is resolved. The Company’s estimates of variable consideration and determination of whether to include estimated amounts in the transaction price may involve judgment and is based largely on an assessment of its anticipated performance and all information that is reasonably available to the Company.

The Company assesses the timing of the transfer of goods or services to the customer as compared to the timing of payments to determine whether a significant financing component exists. As a practical expedient, the Company does not assess the existence of a significant financing component when the difference between payment and transfer of deliverables is a year or less. If the difference in timing arises for reasons other than the provision of finance to either the customer or us, no financing component is deemed to exist. The primary purpose of the Company’s invoicing terms is to provide customers with simplified and predictable ways of purchasing its services, not to receive or provide financing from or to customers. The Company does not consider set up or transition fees paid upfront by its customers to represent a financing component, as such fees are required to encourage customer commitment to the project and protect us from early termination of the contract.

Disaggregation of Revenue [Policy Text Block]

Disaggregation of Revenue

The table below presents disaggregated revenue from contracts with customers by contract-type. We believe this disaggregation best depicts the nature, amount, timing and uncertainty of our revenue and cash flows that may be affected by industry, market, and other economic factors:

	Three Months Ended
	September 30,
	2023		2022
Recurring revenue– subscription and support services	$	5,046,685	$	4,677,977
Non-recurring revenue – setup and training services		13,427		42,500
Total	$	5,060,112	$	4,720,477

Earnings Per Share, Policy [Policy Text Block]

Earnings Per Share

Basic net income per share of Common Stock (“Basic EPS”) excludes dilution and is computed by dividing net income applicable to Common Stockholders by the weighted average number of Common Stock outstanding during the period. Diluted net income per share of Common Stock (“Diluted EPS”) reflects the potential dilution that could occur if stock options or other contracts to issue shares of Common Stock were exercised or converted into Common Stock. The computation of Diluted EPS does not assume exercise or conversion of securities that would have an antidilutive effect on net income per share of Common Stock.

For the three months ended September 30, 2023 and 2022, warrants to purchase 23,737 shares of our Common Stock at an exercise price of $10.00 per share were anti-dilutive and not included in the computation of diluted earnings per share because the exercise price of the options was greater than the average price of Common Stock for the quarter.

The following table presents the components of the computation of basic and diluted earnings per share for the periods indicated:

	Three Months Ended
	September 30,
	2023		2022
Numerator
Net income applicable to common shareholders	$	1,231,937	$	1,138,501
Denominator
Weighted average common shares outstanding, basic		18,225,000		18,465,000
Warrants to purchase Common Stock		614,000		288,000
Weighted average common shares outstanding, diluted		18,839,000		18,753,000
Net income per share
Basic	$	0.07	$	0.06
Diluted	$	0.07	$	0.06

Reclassification [Policy Text Block]

Reclassifications

Certain prior year amounts have been reclassified to conform with the current year’s presentation. These reclassifications have no impact on the previously reported results.

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Note 2 - Significant Accounting Policies (Tables)

3 Months Ended

Sep. 30, 2023

Notes Tables

Contract with Customer, Contract Asset, Contract Liability, and Receivable [Table Text Block]

	Contract assets
Balance – June 30, 2023	$	295,011
Revenue recognized during the period but not billed		-
Amounts reclassified to accounts receivable		(10,000	)
Other		(16,210	)
Balance – September 30, 2023	$	268,801	(1)

	Contract liability
Balance – June 30, 2023	$	1,903,001
Amounts billed but not recognized as revenue		537,630
Revenue recognized related to the opening balance of deferred revenue		(360,207	)
Balance – September 30, 2023	$	2,080,424

Disaggregation of Revenue [Table Text Block]

	Three Months Ended
	September 30,
	2023		2022
Recurring revenue– subscription and support services	$	5,046,685	$	4,677,977
Non-recurring revenue – setup and training services		13,427		42,500
Total	$	5,060,112	$	4,720,477

Schedule of Earnings Per Share, Basic and Diluted [Table Text Block]

	Three Months Ended
	September 30,
	2023		2022
Numerator
Net income applicable to common shareholders	$	1,231,937	$	1,138,501
Denominator
Weighted average common shares outstanding, basic		18,225,000		18,465,000
Warrants to purchase Common Stock		614,000		288,000
Weighted average common shares outstanding, diluted		18,839,000		18,753,000
Net income per share
Basic	$	0.07	$	0.06
Diluted	$	0.07	$	0.06

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Note 3 - Equity (Tables)

3 Months Ended

Sep. 30, 2023

Notes Tables

Share-Based Payment Arrangement, Restricted Stock and Restricted Stock Unit, Activity [Table Text Block]

Restricted Stock Units	Restricted Stock Units		Weighted Average Grant Date Fair Value ($/share)
Outstanding at June 30, 2023		907,451	$	5.30
Granted		13,010		9.99
Vested and issued		-		-
Forfeited		-		-
Outstanding at September 30, 2023		920,461	$	5.36

Schedule of Stockholders' Equity Note, Warrants or Rights [Table Text Block]

Warrants Outstanding at September 30, 2023								Warrants Exercisable at September 30, 2023
Range of exercise prices		Number Outstanding		Weighted average remaining contractual life (years)		Weighted average exercise price		Number exercisable		Weighted average exercise price
$	4.00		1,085,068		2.35	$	4.00		1,085,068	$	4.00
$	10.00		23,737		2.32	$	10.00		23,737	$	10.00
			1,108,805		2.35	$	4.13		1,108,805	$	4.13

Preferred Stock Redemption [Table Text Block]

	Series B Preferred
Period (1)	Total Number of Shares Redeemed		Price Paid Per Share		Dollars Expended by Period under the Preferred Redemption		Remaining Amount Available for Future Preferred Redemption
July 1, 2023 – September 30, 2023:		-	$	10.70	$	-	$	8,964,214

	Series B-1 Preferred
Period (1)	Total Number of Shares Redeemed		Price Paid Per Share		Dollars Expended by Period under the Preferred Redemption		Remaining Amount Available for Future Preferred Redemption
July 1, 2023 – September 30, 2023:		-	$	10.70	$	-	$	8,964,214

Share Repurchase Program [Table Text Block]

Period (1)	Total Number of Shares Purchased		Average Price Paid Per Share		Dollars Expended by Period Under the Plans or Programs		Remaining Amount Available for Future Share Repurchases Under the Plans or Programs
July 1, 2023 – September 30, 2023:		155,025	$	8.53	$	1,322,082	$	8,513,828

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Note 2 - Significant Accounting Policies (Details Textual) - USD ($)	3 Months Ended
	Sep. 30, 2023	Jun. 30, 2023
Contract with Customer, Asset, after Allowance for Credit Loss, Current	$ 160,749	$ 186,959
Contract with Customer, Asset, after Allowance for Credit Loss, Noncurrent	$ 108,052	$ 108,052
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount (in shares)	23,737
Maximum [Member]
Class of Warrant or Right, Exercise Price of Warrants or Rights (in dollars per share)	$ 10.00

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Note 2 - Significant Accounting Policies - Contract with Customer assets and liabilities (Details)	3 Months Ended
	Sep. 30, 2023 USD ($)
Balance	$ 295,011
Balance	1,903,001
Revenue recognized during the period but not billed	0
Amounts billed but not recognized as revenue	537,630
Amounts reclassified to accounts receivable	(10,000)
Revenue recognized related to the opening balance of deferred revenue	(360,207)
Other	(16,210)
Balance	2,080,424
Balance	$ 268,801	[1]

[1] Contract asset balances for September 30, 2023 include a current and a long-term contract asset of $160,749 and $108,052, respectively.

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Note 2 - Significant Accounting Policies - Schedule of Disaggregation of Revenue (Details) - USD ($)	3 Months Ended
	Sep. 30, 2023	Sep. 30, 2022
Revenue	$ 5,060,112	$ 4,720,477
Subscription and Support [Member]
Revenue	5,046,685	4,677,977
Professional Services [Member]
Revenue	$ 13,427	$ 42,500

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Note 2 - Significant Accounting Policies - Schedule of Earnings Per Share (Details) - USD ($)	3 Months Ended
	Sep. 30, 2023	Sep. 30, 2022
Net income applicable to common shareholders	$ 1,231,937	$ 1,138,501
Weighted average shares, basic (in shares)	18,225,000	18,465,000
Warrants to purchase Common Stock (in shares)	614,000	288,000
Weighted average shares, diluted (in shares)	18,839,000	18,753,000
Basic (in dollars per share)	$ 0.07	$ 0.06
Diluted (in dollars per share)	$ 0.07	$ 0.06

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Note 3 - Equity (Details Textual) - USD ($)					3 Months Ended		52 Months Ended
		May 10, 2022	Aug. 31, 2021	May 18, 2021	Sep. 30, 2023		Sep. 30, 2023	Aug. 29, 2023	Jun. 30, 2023	May 09, 2019
Share-Based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Amount					$ 4,900,000		$ 4,900,000
Share-Based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Period for Recognition (Year)					3 years
Preferred Stock, Shares Authorized (in shares)					30,000,000		30,000,000		30,000,000
Preferred Stock, Par or Stated Value Per Share (in dollars per share)					$ 0.01		$ 0.01		$ 0.01
Preferred Stock, Redemption Price Per Share (in dollars per share)								$ 10.70
Preferred Stock, Redemption, Aggerate Purchase Price								$ 8,964,214
Stock Repurchase Program, Authorized Amount				$ 8,000,000.0	$ 21,000,000,000,000		$ 21,000,000,000,000			$ 4,000,000.0
Stock Repurchase Program, Increase in Authorized Amount		$ 9,000,000.0	$ 4,000,000	$ 4,000,000
Stock Repurchase Program, Authorized Amount (in shares)					155,025	[1]	2,052,844
Shares Acquired, Average Cost Per Share					$ 8.53	[1]	$ 6.22
Stock Repurchase Program, Remaining Authorized Repurchase Amount					$ 8,513,828		$ 8,513,828
Blank Check [Member]
Preferred Stock, Shares Authorized (in shares)					30,000,000		30,000,000
Preferred Stock, Par or Stated Value Per Share (in dollars per share)					$ 0.01		$ 0.01
Series B Preferred Stock [Member]
Preferred Stock, Shares Authorized (in shares)					700,000		700,000		700,000
Preferred Stock, Shares, Number (in shares)					700,000
Preferred Stock, Redemption Price Per Share (in dollars per share)	[2]				$ 10.70		$ 10.70
Preferred Stock, Redemption, Aggerate Purchase Price	[2]				$ 8,964,214		$ 8,964,214
Preferred Stock, Shares Issued (in shares)					625,375		625,375		625,375
Series B-1 Preferred Stock [Member]
Preferred Stock, Shares Authorized (in shares)					550,000		550,000		550,000
Preferred Stock, Shares, Number (in shares)					550,000
Preferred Stock, Cash, Dividend Rate, Percentage					7.00%
Preferred Stock, Series B Preferred Shares, Dividend Rate, Percentage					9.00%
Preferred Stock, Redemption Price Per Share (in dollars per share)	[3]				$ 10.70		$ 10.70
Preferred Stock, Redemption, Aggerate Purchase Price	[3]				$ 8,964,214		$ 8,964,214
Preferred Stock, Shares Issued (in shares)					212,402		212,402		212,402
Restricted Stock Units (RSUs) [Member] | Vested and Unissued [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award, Non-Option Equity Instruments, Outstanding, Number (in shares)					40,004		40,004

[1] We close our books and records on the last calendar day of each month to align our financial closing with our business processes.

[2] We close our books and records on the last calendar day of each month to align our financial closing with our business processes.

[3] We close our books and records on the last calendar day of each month to align our financial closing with our business processes.

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Note 3 - Equity - Schedule of Restricted Stock Units (Details) - Share-Based Payment Arrangement, Nonemployee [Member] - $ / shares	3 Months Ended
	Sep. 30, 2023	Sep. 30, 2022
Granted (in shares)	13,010
Restricted Stock [Member]
Outstanding (in shares)	907,451
Outstanding, weighted average grant date fair value (in dollars per share)		$ 5.30
Restricted Stock Units (RSUs) [Member]
Granted, weighted average grant date fair value (in dollars per share)		9.99
Vested and issued (in shares)	0
Vested and issued, weighted average grant date fair value (in dollars per share)		0
Forfeited (in shares)	0
Forfeited, weighted average grant date fair value (in dollars per share)		0
Outstanding (in shares)	920,461
Outstanding, weighted average grant date fair value (in dollars per share)		$ 5.36

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Note 3 - Equity - Schedule of Warrants (Details)	3 Months Ended
	Sep. 30, 2023 $ / shares shares
Class of Warrant or Right, Outstanding, Weighted Average Exercise Price (in dollars per share) | $ / shares	$ 4.13
Class of Warrant or Right, Outstanding (in shares) | shares	1,108,805
Class of Warrant or Right, Weighted Average Remaining Contractual Term (Year)	2 years 4 months 6 days
Class of Warrant or Right, Warrants, Exercisable, Number (in shares) | shares	1,108,805
Class of Warrant or Right, Exercisable, Weighted Average Exercise Price (in dollars per share) | $ / shares	$ 4.13
Exercise Price, Four Dollars, Minimum [Member]
Class of Warrant or Right, Outstanding, Weighted Average Exercise Price (in dollars per share) | $ / shares	$ 4.00
Class of Warrant or Right, Outstanding (in shares) | shares	1,085,068
Class of Warrant or Right, Weighted Average Remaining Contractual Term (Year)	2 years 4 months 6 days
Class of Warrant or Right, Warrants, Exercisable, Number (in shares) | shares	1,085,068
Class of Warrant or Right, Exercisable, Weighted Average Exercise Price (in dollars per share) | $ / shares	$ 4.00
Exercise Price, Ten Dollars, Maximum [Member]
Class of Warrant or Right, Outstanding, Weighted Average Exercise Price (in dollars per share) | $ / shares	$ 10.00
Class of Warrant or Right, Outstanding (in shares) | shares	23,737
Class of Warrant or Right, Weighted Average Remaining Contractual Term (Year)	2 years 3 months 25 days
Class of Warrant or Right, Warrants, Exercisable, Number (in shares) | shares	23,737
Class of Warrant or Right, Exercisable, Weighted Average Exercise Price (in dollars per share) | $ / shares	$ 10.00

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Note 3 - Equity - Preferred Stock Redemption (Details) - USD ($)		3 Months Ended
		Sep. 30, 2023	Aug. 29, 2023
Price paid per share (in dollars per share)			$ 10.70
Remaining Amount Available for Future Preferred Redemption			$ 8,964,214
Series B Preferred Stock [Member]
Total number of shares redeemed (in shares)	[1]	0
Price paid per share (in dollars per share)	[1]	$ 10.70
Dollars Expended by Period under the Preferred Redemption	[1]	$ 0
Remaining Amount Available for Future Preferred Redemption	[1]	$ 8,964,214
Series B-1 Preferred Stock [Member]
Total number of shares redeemed (in shares)	[2]	0
Price paid per share (in dollars per share)	[2]	$ 10.70
Dollars Expended by Period under the Preferred Redemption	[2]	$ 0
Remaining Amount Available for Future Preferred Redemption	[2]	$ 8,964,214

[1] We close our books and records on the last calendar day of each month to align our financial closing with our business processes.

[2] We close our books and records on the last calendar day of each month to align our financial closing with our business processes.

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Note 3 - Equity - Share Repurchase Program (Details)	3 Months Ended		52 Months Ended
	Sep. 30, 2023 USD ($) $ / shares shares		Sep. 30, 2023 USD ($) $ / shares shares
Total number of shares purchased (in shares) | shares	155,025	[1]	2,052,844
Average price paid per share (in dollars per share) | $ / shares	$ 8.53	[1]	$ 6.22
Amount available for future share repurchases under the plans or programs | $	$ 8,513,828		$ 8,513,828
Share Repurchase Program [Member]
Total number of shares purchased (in shares) | shares	1,322,082	[1]
Amount available for future share repurchases under the plans or programs | $	$ 8,513,828	[1]	$ 8,513,828	[1]

[1] We close our books and records on the last calendar day of each month to align our financial closing with our business processes.

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Note 4 - Related Party Transactions (Details Textual) - USD ($)	3 Months Ended
	Sep. 30, 2023	Sep. 30, 2022
Related Party [Member]
Accounts Payable	$ 0	$ 0
FMI [Member] | Service Agreements [Member]
Related Party Transaction, Amounts of Transaction	$ 231,015	$ 231,015