4. SUPPLEMENTAL CONSOLIDATED FINANCIAL STATEMENT INFORMATION

Except for the items mentioned below, no other balance sheet opening balances were materially impacted at January 1, 2017 for the adoption of Topic 606.

Deferred Costs (in thousands)

The opening balance of deferred cost was $2,991 and $3,668 at January 1, 2018 and 2017, respectively. The Company’s prepaid expenses and other current assets at September 30, 2018 and 2017 included deferred costs incurred to fulfill contracts with customers of $3,157 and $1,625, respectively.

Deferred costs at September 30, 2018 compared to January 1, 2018 remained fairly consistent. Deferred cost at September 30, 2017 compared to January 1, 2017 decreased primarily as a result of the completion of several projects during that nine month period that had significant deferred fulfillment costs at January 1, 2017.

The amount of total deferred costs amortized for the third quarter and first nine months of 2018 was $14,757 and $29,004, respectively. The amount of total deferred cost amortized for the third quarter and first nine months of 2017 was $12,485 and $35,773, respectively. There were no material impairment losses incurred during these periods.

Deferred Revenue (in thousands)

The opening balance of deferred revenue was $6,314 and $5,385 at January 1, 2018 and 2017, respectively. The Company’s deferred revenue at September 30, 2018 and 2017 was $2,779 and $4,587, respectively.

Deferred revenue at September 30, 2018 compared to January 1, 2018 decreased primarily as a result of completing projects for clients with large prepayments for third party reimbursables. Deferred revenue at September 30, 2017 compared to January 1, 2017 decreased primarily as a result of the completion of projects that had deferred revenue at January 1, 2017.

Revenue recognized for the third quarter and first nine months of 2018 that was included in the contract liability balance at the beginning of 2018 was $634 and $5,945, respectively. Revenue recognized for the third quarter and first nine months of 2017 that was included in the contract liability balance at the beginning of 2017 was $96 and $4,806, respectively.

Adjustments to Condensed Consolidated Financial Statements

The following tables reflect the adjustments applied to our condensed consolidated financial statements related to both the adoption of Topic 606 and the 5% stock dividend discussed in Note 2 – Summary of Significant Accounting Policies’ Basis of Presentation.

Select line items from the Company’s Condensed Consolidated Balance Sheets which reflect the adoption of the new standard and 5% stock dividend are as follows (in thousands):


	December 31, 2017
	As Previously Reported		Topic 606 Adjustments		Stock Dividend Adjustments		As Adjusted
Current assets:
Accounts receivable, net	$	33,138	$	18			$	33,156
Prepaid expenses and other current assets	$	4,677	$	2,663			$	7,340
Current liabilities:
Deferred revenue	$	3,699	$	2,615			$	6,314
Stockholders' equity:
Common Stock	$	218			$	11	$	229
Additional paid-in capital	$	143,835			$	8,046	$	151,881
Retained deficit	$	(2,021)	$	66	$	(8,057)	$	(10,012)

Select line items from the Company’s Condensed Consolidated Statements of Operations and Comprehensive Loss which reflect the adoption of the new standard and the 5% stock dividend are as follows (in thousands except share and per share data):


	Three Months Ended September 30, 2017
	As Previously Reported		Topic 606 Adjustments		Stock Dividend Adjustments		As Adjusted
Operating revenues	$	45,627	$	(519)			$	45,108
Operating costs:
Operating expenses	$	36,594	$	(356)			$	36,238
Loss from operations	$	(4,136)	$	(163)			$	(4,299)
Net loss	$	(2,759)	$	(163)			$	(2,922)
Basic and diluted loss per share of common stock	$	(0.13)	$	—	$	—	$	(0.13)
Weighted average equivalent common shares
outstanding and outstanding - assuming dilution		21,701,662				1,085,083		22,786,745


	Nine Months Ended September 30, 2017
	As Previously Reported		Topic 606 Adjustments		Stock Dividend Adjustments		As Adjusted
Operating revenues	$	118,023	$	1,091			$	119,114
Operating costs:
Operating expenses	$	107,639	$	1,371			$	109,010
Loss from operations	$	(31,662)	$	(280)			$	(31,942)
Net loss	$	(26,722)	$	(280)			$	(27,002)
Basic and diluted loss per share of common stock	$	(1.23)	$	—	$	0.04	$	(1.19)
Weighted average equivalent common shares
outstanding and outstanding - assuming dilution		21,681,474				1,084,074		22,765,548

Select line items from the Company’s Condensed Consolidated Statements of Cash Flows which reflect the adoption of the new standard are as follows (in thousands):


	Nine Months Ended September 30, 2017
	As Previously Reported		Topic 606 Adjustments			As Adjusted
Cash flows from operating activities:
Net loss	$	(26,722)	$	(280)	$	(27,002)
Change in current assets and liabilities:
Increase in accounts receivable	$	(9,568)	$	197	$	(9,371)
(Increase) decrease in prepaid expenses and other current assets	$	(1,135)	$	1,301	$	166
Increase in accounts payable	$	2,197	$	70	$	2,267
Increase (decrease) in deferred revenue	$	489	$	(1,288)	$	(799)
Net cash used in operating activities	$	(3,309)	$	—	$	(3,309)