Note

- Operating Segments

The Company’s reportable segments are: (i) the Traditional Business and (ii) Journal Technologies. All inter-segment transactions were eliminated. Summarized financial information regarding the Company’s reportable segments is shown in the following table:

	Reportable Segments
	Traditional Business			Journal Technologies			Corporate income and expenses			Total
Six months ended March 31, 2019
Revenues
Advertising	$	4,300,000		$	---		$	---		$	4,300,000
Circulation		2,611,000			---			---			2,611,000
Advertising service fees and other		1,293,000			---			---			1,293,000
Licensing and maintenance fees		---			9,430,000			---			9,430,000
Consulting fees		---			940,000			---			940,000
Other public service fees		---			2,566,000			---			2,566,000
Operating expenses		8,348,000			17,984,000			---			26,332,000
Loss from operations		(144,000	)		(5,048,000	)		---			(5,192,000	)
Dividends and interest income		---			---			2,671,000			2,671,000
Other income		---			---			19,000			19,000
Net unrealized losses on investments		---			---			(20,143,000	)		(20,143,000	)
Interest expenses on note payable collateralized by real estate		(45,000	)		---			---			(45,000	)
Interest expenses on margin loans		---			---			(425,000	)		(425,000	)
Pretax (loss) income		(189,000	)		(5,048,000	)		(17,878,000	)		(23,115,000	)
Income tax benefit (expense)		115,000			1,300,000			5,185,000			6,600,000
Net income (loss)		(74,000	)		(3,748,000	)		(12,693,000	)		(16,515,000	)
Total assets		17,399,000			31,710,000			194,354,000			243,463,000
Capital expenditures		50,000			34,000			---			84,000

	Reportable Segments
	Traditional Business			Journal Technologies			Corporate income and expenses			Total
Six months ended March 31, 2018
Revenues
Advertising	$	4,325,000		$	---		$	---		$	4,325,000
Circulation		2,719,000			---			---			2,719,000
Advertising service fees and other		1,261,000			---			---			1,261,000
Licensing and maintenance fees		---			8,331,000			---			8,331,000
Consulting fees		---			1,207,000			---			1,207,000
Other public service fees		---			1,747,000			---			1,747,000
Operating expenses		8,507,000			18,901,000			---			27,408,000
Loss from operations		(202,000	)		(7,616,000	)		---			(7,818,000	)
Dividends and interest income		---			---			2,507,000			2,507,000
Gains on sales of bonds		---			---			3,180,000			3,180,000
Other income and capital asset		---			---			21,000			21,000
Interest expenses on note payable collateralized by real estate		(48,000	)		---			---			(48,000	)
Interest expenses on margin loans		---			---			(285,000	)		(285,000	)
Pretax (loss) income		(250,000	)		(7,616,000	)		5,423,000			(2,443,000	)
Income tax benefit (expense)		(785,000	)		(935,000	)		18,670,000			16,950,000
Net income (loss)		(1,035,000	)		(8,551,000	)		24,093,000			14,507,000
Total assets		22,347,000			26,592,000			217,803,000			266,742,000
Capital expenditures		75,000			---			---			75,000
Amortization of intangible assets		---			1,810,000			---			1,810,000

	Reportable Segments
	Traditional Business			Journal Technologies			Corporate income and expenses			Total
Three months ended March 31, 2019
Revenues
Advertising	$	2,108,000		$	---		$	---		$	2,108,000
Circulation		1,273,000			---			---			1,273,000
Advertising service fees and other		624,000			---			---			624,000
Licensing and maintenance fees		---			4,640,000			---			4,640,000
Consulting fees		---			399,000			---			399,000
Other public service fees		---			1,668,000			---			1,668,000
Operating expenses		4,140,000			9,243,000			---			13,383,000
Loss from operations		(135,000	)		(2,536,000	)		---			(2,671,000	)
Dividends and interest income		---			---			1,141,000			1,141,000
Other income		---			---			9,000			9,000
Net unrealized gains on investments		---			---			8,497,000			8,497,000
Interest expenses on note payable collateralized by real estate		(22,000	)		---			---			(22,000	)
Interest expenses on margin loans		---			---			(219,000	)		(219,000	)
Pretax income (loss)		(157,000	)		(2,536,000	)		9,428,000			6,735,000
Income tax benefit (expense)		35,000			715,000			(2,467,000	)		(1,717,000	)
Net (loss) income		(122,000	)		(1,821,000	)		6,961,000			5,018,000
Total assets		17,399,000			31,710,000			194,354,000			243,463,000
Capital expenditures		---			---			---			---

	Reportable Segments
	Traditional Business			Journal Technologies			Corporate income and expenses			Total
Three months ended March 31, 2018
Revenues
Advertising	$	2,209,000		$	---		$	---		$	2,209,000
Circulation		1,356,000			---			---			1,356,000
Advertising service fees and other		659,000			---			---			659,000
Licensing and maintenance fees		---			3,981,000			---			3,981,000
Consulting fees		---			212,000			---			212,000
Other public service fees		---			921,000			---			921,000
Operating expenses		4,193,000			9,518,000			---			13,711,000
Income (loss) from operations		31,000			(4,404,000	)		---			(4,373,000	)
Dividends and interest income		---			---			1,024,000			1,024,000
Gains on sales of bonds		---			---			3,180,000			3,180,000
Other income and capital asset		---			---			10,000			10,000
Interest expenses on note payable collateralized by real estate		(24,000	)		---			---			(24,000	)
Interest expenses on margin loans		---			---			(149,000	)		(149,000	)
Pretax income (loss)		7,000			(4,404,000	)		4,065,000			(332,000	)
Income tax benefit (expense)		(105,000	)		1,250,000			(1,045,000	)		100,000
Net (loss) income		(98,000	)		(3,154,000	)		3,020,000			(232,000	)
Total assets		22,347,000			26,592,000			217,803,000			266,742,000
Capital expenditures		41,000			---			---			41,000
Amortization of intangible assets		---			748,000			---			748,000

During the

six

months ended

March 31, 2019,

the Traditional Business had total revenues of

$8,204,000

of which

$5,593,000

were recognized, at a point of time, after services were provided and

$2,611,000

were recognized ratably over the subscription terms. Total revenues for the Company’s software business were

$12,936,000

of which

$4,035,000

were recognized upon completion of services with customer acceptance while

$8,901,000

were recognized ratably over the subscription periods.

During the

three

months ended

March 31, 2019,

the Traditional Business had total revenues of

$4,005,000

of which

$2,732,000

were recognized, at a point of time, after services were provided and

$1,273,000

were recognized ratably over the subscription terms. Total revenues for the Company’s software business were

$6,707,000

of which

$2,100,000

were recognized upon completion of services with customer acceptance while

$4,607,000

were recognized ratably over the subscription periods.

Approximately

63%

and

61%

of the Company’s revenues during the

three

-and

six

-month periods ended

March 31, 2019

were derived from Journal Technologies, as compared with

55%

and

58%

in the prior year period. In addition, the Company’s revenues have been primarily from the United States with approximately

from foreign countries. Journal Technologies’ revenues are all from governmental agencies.

The following table sets forth certain deferred obligations from

October 1, 2018

through

March 31, 2019:

	Beginning Balance		Addition		Recognized			Ending Balance

Deferred subscriptions	$	3,174,000	$	2,415,000	$	(2,611,000	)	$	2,978,000
Deferred installation contracts		2,554,000		1,343,000		(1,469,000	)		2,428,000
Deferred maintenance agreements and others		14,362,000		9,121,000		(8,901,000	)		14,582,000