0001171843-22-002192 | 10-K | XBRL Viewer

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Note 2 - Summary of Significant Accounting Policies - Revenue by Major Source (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Revenues	$ 24,909	$ 21,360	$ 37,678
Testing [Member]
Revenues	21,894	19,068	34,555
Shipping/Collection (Hair) [Member]
Revenues	2,847	2,174	2,876
Other Revenue [Member]
Revenues	$ 168	$ 118	$ 247

- Definition

Amount, including tax collected from customer, of revenue from satisfaction of performance obligation by transferring promised good or service to customer. Tax collected from customer is tax assessed by governmental authority that is both imposed on and concurrent with specific revenue-producing transaction, including, but not limited to, sales, use, value-added and excise.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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Reference 3: http://www.xbrl.org/2003/role/disclosureRef
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Reference 4: http://www.xbrl.org/2003/role/disclosureRef
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Reference 6: http://www.xbrl.org/2003/role/disclosureRef
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Reference 7: http://www.xbrl.org/2003/role/disclosureRef
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Reference 8: http://www.xbrl.org/2003/role/disclosureRef
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Reference 9: http://www.xbrl.org/2003/role/disclosureRef
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+ Details

Note 3 - Accounts Receivable

12 Months Ended

Dec. 31, 2021

Notes to Financial Statements

Loans, Notes, Trade and Other Receivables Disclosure [Text Block]

3. Accounts Receivable

The Company maintains an allowance for uncollectible accounts receivable based on management’s assessment of the collectability of its customer accounts by reviewing customer payment patterns and other relevant factors. The Company reviews the adequacy of the allowance for uncollectible accounts on a quarterly basis and adjusts the balance as determined necessary. Write-offs are recorded at the time a customer account is deemed uncollectable. The following is a rollforward of the Company’s allowance for doubtful accounts (in thousands):

	As of December 31,
	2021			2020
Balance, beginning of period	$	37		$	45
Provision for doubtful accounts		55			22
Write-offs		( 3	)		( 30	)
Balance, end of period	$	89		$	37

Consolidated Statements of Shareholders' Equity (Parentheticals) - $ / shares	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Dividends declared, per share (in dollars per share)	$ 0.05	$ 0.18	$ 0.72

Note 7 - Stock-based Awards (Tables)

12 Months Ended

Dec. 31, 2021

Notes Tables

Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Weighted Average Grant Date Fair Value [Table Text Block]

Grant Date	Type	Shares		Fair Value Per Share (1)
May 13, 2021	SUA		116	$	6.55
March 16, 2021	SUA		2	$	7.04
January 25, 2021	SUA		2	$	5.54
December 16, 2020	SUA		5	$	4.71
November 11, 2020	Options		40	$	1.13
November 11, 2020	SUA		190	$	4.07
May 3, 2019	Options		192	$	2.99
May 3, 2019	SUA		18	$	10.60

Share-based Payment Arrangement, Option, Activity [Table Text Block]

	Number of Shares			Weighted Average Exercise Price Per Share		Weighted Average Remaining Contractual Life (years)		Aggregate Intrinsic Value⁽²⁾
Outstanding, December 31, 2020		604		$	14.31		7.0	$	-
Granted		-		$	-
Exercised		(1	)	$	4.07
Forfeited		(29	)	$	3.47
Outstanding, December 31, 2021		574		$	14.23		6.1	$	100

Exercisable, December 31, 2021		464		$	15.12		5.7	$	-

Schedule of Nonvested Restricted Stock Units Activity [Table Text Block]

				Weighted Average
	*Number of*			*Grant-Date Fair Value*
	*Shares*			per Share⁽³⁾
Outstanding & Unvested, December 31, 2020		166		$	4.50
Granted		119		$	6.55
Converted to common stock		( 52	)	$	4.89
Cancelled		( 9	)	$	4.94
Forfeited		-		$	-
Outstanding & Unvested, December 31, 2021		224		$	5.48

Note 3 - Accounts Receivable - Summary of the Allowance for Doubtful Accounts (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020
Balance, beginning of period	$ 37	$ 45
Provision for doubtful accounts	55	22
Write-offs	(3)	(30)
Balance, end of period	$ 89	$ 37

Note 1 - Nature of Business	12 Months Ended
Dec. 31, 2021
Notes to Financial Statements
Organization, Consolidation and Presentation of Financial Statements Disclosure [Text Block]	1. Nature of Business *Company Overview* Psychemedics Corporation (the “Company”) provides hair testing for drugs of abuse, utilizing a patented hair analysis method involving digestion of hair, enzyme immunoassay and mass spectrometry to analyze hair to detect abused substances. The Company’s customers include Fortune 500 companies, as well as small to mid-size corporations, schools and governmental entities located in the United States and Internationally. *COVID-19 Pandemic* The outbreak of coronavirus (“COVID-19”) which was declared by the World Health Organization to be a pandemic, has, and is expected to continue to impact worldwide economic activity. While our domestic business has been deemed an essential business and we continue to provide services to our customers, COVID-19 has had a significant impact on our entire operations. Additionally, COVID-19’s effect on the overall economy has had an adverse impact on hiring, which is having a negative impact on our testing volume. The Coronavirus Aid, Relieve and Economic Security Act (“CARES”) Act, enacted on March 27, 2020, and the Families First Coronavirus Response Act, in each case modified by the Consolidated Appropriations Act enacted in December 2020, were emergency economic stimulus packages that included spending provisions and tax cuts to strengthen the United States economy and to fund a nationwide effort to curtail the effect of COVID-19. The principal impact of the CARES Act and subsequent legislation was the adoption of the Paycheck Protection Program (“PPP”). The CARES Act, together with subsequent legislation, also provided sweeping tax changes in response to the COVID-19 pandemic, including amendments to certain provisions of the previously enacted Tax Cuts and Jobs Act. The Company recognized a benefit of $2.6 million and $0.2 million for the years ended December 31, 2021, and December 31, 2020, respectively, as a reduction to cost of revenues and operating expenses related to the employee retention credit which was a tax provision in the CARES Act and subsequent legislation. Additionally, the CARES Act allowed the Company to fully carryback the 2020 net operating loss, for a refund of corporate income taxes previously paid. *Liquidity and Management’s Plans* At December 31, 2021, the Company’s principal sources of liquidity included $2.0 million of cash on hand. Management currently believes that such funds, together with future operating profits, should be adequate to fund anticipated working capital requirements, including debt obligations, and capital expenditures for at least the next 12 months. Depending upon the Company’s results of operations, its future capital needs and available marketing opportunities, the Company may use various financing sources to raise additional funds. Such sources could include but are not limited to, issuance of common stock or debt financing, lines of credit, or equipment leasing, although there is no assurance that such financings will be available to the Company on terms it deems acceptable, if at all.

Note 1 - Nature of Business

12 Months Ended

Dec. 31, 2021

Notes to Financial Statements

Organization, Consolidation and Presentation of Financial Statements Disclosure [Text Block]

1. Nature of Business

Company Overview

Psychemedics Corporation (the “Company”) provides hair testing for drugs of abuse, utilizing a patented hair analysis method involving digestion of hair, enzyme immunoassay and mass spectrometry to analyze hair to detect abused substances. The Company’s customers include Fortune 500 companies, as well as small to mid-size corporations, schools and governmental entities located in the United States and Internationally.

COVID-19 Pandemic

The outbreak of coronavirus (“COVID-19”) which was declared by the World Health Organization to be a pandemic, has, and is expected to continue to impact worldwide economic activity. While our domestic business has been deemed an essential business and we continue to provide services to our customers, COVID-19 has had a significant impact on our entire operations. Additionally, COVID-19’s effect on the overall economy has had an adverse impact on hiring, which is having a negative impact on our testing volume.

The Coronavirus Aid, Relieve and Economic Security Act (“CARES”) Act, enacted on March 27, 2020, and the Families First Coronavirus Response Act, in each case modified by the Consolidated Appropriations Act enacted in December 2020, were emergency economic stimulus packages that included spending provisions and tax cuts to strengthen the United States economy and to fund a nationwide effort to curtail the effect of COVID-19. The principal impact of the CARES Act and subsequent legislation was the adoption of the Paycheck Protection Program (“PPP”). The CARES Act, together with subsequent legislation, also provided sweeping tax changes in response to the COVID-19 pandemic, including amendments to certain provisions of the previously enacted Tax Cuts and Jobs Act. The Company recognized a benefit of $2.6 million and $0.2 million for the years ended December 31, 2021, and December 31, 2020, respectively, as a reduction to cost of revenues and operating expenses related to the employee retention credit which was a tax provision in the CARES Act and subsequent legislation. Additionally, the CARES Act allowed the Company to fully carryback the 2020 net operating loss, for a refund of corporate income taxes previously paid.

Liquidity and Management’s Plans

At December 31, 2021, the Company’s principal sources of liquidity included $2.0 million of cash on hand. Management currently believes that such funds, together with future operating profits, should be adequate to fund anticipated working capital requirements, including debt obligations, and capital expenditures for at least the next 12 months. Depending upon the Company’s results of operations, its future capital needs and available marketing opportunities, the Company may use various financing sources to raise additional funds. Such sources could include but are not limited to, issuance of common stock or debt financing, lines of credit, or equipment leasing, although there is no assurance that such financings will be available to the Company on terms it deems acceptable, if at all.

Note 10 - Operating Leases - Maturities of Lease Liabilities (Details) - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020
2022	$ 1,117
2023	1,118
2024	1,034
2025	592
2026	460
Total lease payments	4,321
Less interest:	(457)
Present value of lease liabilities	3,864
Current operating lease liabilities	984	$ 875
Long-term operating lease liabilities	2,880	$ 3,895
Total	$ 3,864

Note 2 - Summary of Significant Accounting Policies - Basic and Diluted Weighted Average Common Shares Outstanding (Details) - shares shares in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Weighted average common shares outstanding, basic (in shares)	5,549	5,524	5,514
Dilutive common equivalent shares (in shares)	0	0	11
Weighted average common shares outstanding, assuming dilution (in shares)	5,549	5,524	5,525

Note 8 - Employee Benefit Plan (Details Textual) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Defined Contribution Plan, Employer Discretionary Contribution Amount	$ 0	$ 198	$ 262

Note 13 - Business Segment Reporting (Details Textual)	12 Months Ended
Note 13 - Business Segment Reporting (Details Textual)	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Number of Operating Segments	1
Customer Concentration Risk [Member] \| Revenue Benchmark [Member]
Number of Major Customers	0	0	1
Customer Concentration Risk [Member] \| Revenue Benchmark [Member] \| BRAZIL
Number of Major Customers	1

Note 8 - Employee Benefit Plan

12 Months Ended

Dec. 31, 2021

Notes to Financial Statements

Compensation and Employee Benefit Plans [Text Block]

8. Employee Benefit Plan

The Psychemedics Corporation 401(k) Savings and Retirement Plan (the “401(k) Plan”) is a qualified defined contribution plan in accordance with Section 401(k) of the Internal Revenue Code. All employees over the age of 21 are eligible to make pre-tax contributions up to a specified percentage of their compensation. Under the 401(k) Plan, the Company may, but is not obligated to, match a portion of the employees’ contributions up to a defined maximum. Matching contributions of zero, $198 thousand and $262 thousand were made in the years ended December 31, 2021, 2020 and 2019, respectively.

Consolidated Balance Sheets - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020
Current Assets:
Cash	$ 1,992	$ 2,833
Accounts receivable, net of allowance for doubtful accounts of $89 and $37 at December 31, 2021 and 2020, respectively	4,116	3,356
Prepaid expenses and other current assets	1,499	914
Income tax receivable	2,678	2,495
Total Current Assets	10,285	9,598
Property and equipment:
Computer software	4,521	4,422
Office furniture and equipment	2,195	2,139
Laboratory equipment	16,005	15,978
Leasehold improvements	3,629	3,629
Property, Plant and Equipment, Gross, Ending Balance	26,350	26,168
Accumulated depreciation and amortization	(19,659)	(16,937)
Property, Plant and Equipment, Net, Ending Balance	6,691	9,231
Other assets	864	888
Net deferred tax assets	160	0
Operating lease right-of-use assets	3,552	4,286
Total Assets	21,552	24,003
Current Liabilities:
Accounts payable	994	577
Accrued expenses	3,188	1,801
Current portion of long-term debt	664	688
Current portion of operating lease liabilities	984	875
Total Current Liabilities	5,830	3,941
Long-term debt	599	3,444
Net deferred tax liabilities	0	211
Long-term portion of operating lease liabilities	2,880	3,895
Total Liabilities	9,309	11,491
Commitments and Contingencies (Note 9)
Shareholders' Equity:
Preferred stock, $0.005 par value, 873 shares authorized, no shares issued or outstanding	0	0
Common stock, $0.005 par value; 50,000 shares authorized 6,257 shares and 6,205 shares issued at December 31, 2021 and 2020, respectively, 5,589 shares outstanding and 5,537 shares outstanding at December 31, 2021 and 2020, respectively	31	31
Additional paid-in capital	33,478	32,803
Less - Treasury stock, at cost, 668 shares	(10,082)	(10,082)
Accumulated deficit	(9,550)	(8,606)
Accumulated other comprehensive loss	(1,634)	(1,634)
Total Shareholders' Equity	12,243	12,512
Total Liabilities and Shareholders' Equity	$ 21,552	$ 24,003

Note 4 - Accrued Expenses (Tables)

12 Months Ended

Dec. 31, 2021

Notes Tables

Schedule of Accrued Liabilities [Table Text Block]

	As of December 31,
	2021		2020
Accrued compensation and employee benefits	$	507	$	315
Accrued vacation expense		373		379
Accrued taxes		200		4
Accrued shipping expense		488		511
Accrued legal settlement		1,150		-
Other accrued expenses		470		592
Total Accrued Expenses	$	3,188	$	1,801

Note 13 - Business Segment Reporting (Tables)

12 Months Ended

Dec. 31, 2021

Notes Tables

Revenue from External Customers by Geographic Areas [Table Text Block]

		Year Ended December 31,
		2021		2020		2019
Consolidated Revenue:
United States	$	23,584	$	19,486	$	27,329
Brazil		640		1,344		9,819
Other		685		530		530
Total Revenue	$	24,909	$	21,360	$	37,678

Consolidated Balance Sheets (Parentheticals) - USD ($) shares in Thousands, $ in Thousands	Dec. 31, 2021	Dec. 31, 2020
Allowance for doubtful accounts	$ 89	$ 37
Preferred stock, par value (in dollars per share)	$ 0.005	$ 0.005
Preferred stock, shares authorized (in shares)	873	873
Preferred stock, shares issued (in shares)	0	0
Preferred stock, shares outstanding (in shares)	0	0
Common stock, par value (in dollars per share)	$ 0.005	$ 0.005
Common stock, shares authorized (in shares)	50,000	50,000
Common stock, shares issued (in shares)	6,257	6,205
Common stock, shares outstanding (in shares)	5,589	5,537
Treasury stock, shares (in shares)	668	668

Note 11 - Debt and Other Financing Arrangements (Details Textual) - USD ($) $ in Thousands				12 Months Ended			68 Months Ended
	May 01, 2020	Dec. 02, 2019	Oct. 30, 2017	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019	Dec. 04, 2019
Interest Expense, Total				$ 49	$ 75	$ 59
Equipment Loan Arrangement [Member]
Debt Instrument, Interest Rate, Stated Percentage				3.79%
Proceeds from Issuance of Long-term Debt, Total				$ 0	0	1,416
Equipment Loan Arrangement [Member] \| London Interbank Offered Rate (LIBOR) [Member]
Debt Instrument, Basis Spread on Variable Rate				1.75%
Paycheck Protection Program CARES Act [Member]
Proceeds from Issuance of Long-term Debt, Total	$ 2,100				2,181	$ 0
Banc of America Leasing and Capital [Member] \| Equipment Loan Arrangement [Member] \| Line of Credit [Member]
Interest Expense, Total		$ 16,000		$ 49
Debt Instrument, Term (Month)		60 months
Debt Instrument, Interest Rate, Stated Percentage		3.79%
Proceeds from Issuance of Long-term Debt, Total							$ 12,200
Repayments of Long-term Debt, Total				700	$ 700
Long-term Debt, Total				$ 1,300
Long-term Debt, Weighted Average Interest Rate, over Time				3.50%
Debt, Weighted Average Interest Rate				3.20%
Banc of America Leasing and Capital [Member] \| Equipment Loan Arrangement [Member] \| Line of Credit [Member] \| London Interbank Offered Rate (LIBOR) [Member]
Debt Instrument, Basis Spread on Variable Rate			1.75%

Consolidated Statements of Operations and Comprehensive Income / (Loss) - USD ($) shares in Thousands, $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Revenues	$ 24,909	$ 21,360	$ 37,678
Cost of revenues	14,645	16,474	21,234
Gross profit	10,264	4,886	16,444
Operating Expenses:
General & administrative	6,126	6,095	7,221
Marketing & selling	2,799	3,577	4,658
Research & development	1,130	1,280	1,567
Total Operating Expenses	10,055	10,952	13,446
Operating income (loss)	209	(6,066)	2,998
Other Income (Expense):
Forgiveness of PPP loan	(2,181)		0
Settlements	(3,150)	0	0
Other (expense) income	(61)	(140)	58
Total Other Income (Expense)	(1,030)	(140)	58
Net (loss) income before (benefit from) provision for income taxes	(821)	(6,206)	3,056
(Benefit from) provision for income taxes	(156)	(2,347)	1,514
Net (loss) income	(665)	(3,859)	1,542
Other Comprehensive (Loss) Income:
Foreign currency translation, net of taxes	0	(10)	(225)
Total Comprehensive (Loss) Income	$ (665)	$ (3,869)	$ 1,317
Basic net (loss) income per share (in dollars per share)	$ (0.12)	$ (0.70)	$ 0.28
Diluted net (loss) income per share (in dollars per share)	$ (0.12)	$ (0.70)	$ 0.28
Weighted average common shares outstanding:
Basic (in shares)	5,549	5,524	5,514
Diluted (in shares)	5,549	5,524	5,525

Significant Accounting Policies (Policies)

12 Months Ended

Dec. 31, 2021

Accounting Policies [Abstract]

Risks and Uncertainties [Policy Text Block]

Risks and Uncertainties

Use of Estimates, Policy [Policy Text Block]

Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the U.S. requires management to make estimates, including those related to bad debts, long-lived asset lives, income tax valuation and share based compensation, and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Changes in estimates are recorded in the period in which they become known.

Cash and Cash Equivalents, Policy [Policy Text Block]

Cash and Cash Equivalents

The Company considers all highly liquid investments with original maturities at the date of purchase of 90 days or less as cash equivalents. As of December 31, 2021 and 2020, there were no investments classified as cash equivalents.

Property, Plant and Equipment, Policy [Policy Text Block]

Property and Equipment

Property & equipment are recorded at cost. Depreciation and amortization is computed over the estimated useful lives of the assets, using the straight-line method. Repair and maintenance costs are expensed as incurred. The estimated useful lives of the assets are:

Computer software (years)
3 to
5

Office furniture and equipment (years)
3 to
7

Laboratory equipment (years)
5 to
7

Leasehold improvements

Lesser of estimated useful life or lease term

The Company recorded depreciation and amortization related to property and equipment and capitalized software of $2.7 million, $2.6 million, and $2.9 million in 2021, 2020 and 2019, respectively. The Company had $0.5 million of capitalized software and equipment that was not placed in service as of December 31, 2021, which is included as a component of computer software on the accompanying consolidated balance sheets.

Research, Development, and Computer Software, Policy [Policy Text Block]

Capitalized Software Development Costs

We capitalize costs related to significant software projects developed or obtained for internal use, including costs incurred in a cloud computing arrangement. Costs incurred during the preliminary project work stage or conceptual stage, such as determining the performance requirements, system requirements and data conversion, are expensed as incurred. Costs incurred in the application development phase, such as coding, testing for new software and upgrades that result in additional functionality, are capitalized and are amortized using the straight-line method over the useful life of the software for three to five years. Costs incurred during the post-implementation/operation stage, including training costs and maintenance costs, are expensed as incurred. In accordance with Company policy, during the years ended December 31, 2021, and 2020, we capitalized internally developed software costs of $99 thousand and $213 thousand, respectively. Amortization expense related to software development costs was $421 thousand, $293 thousand and $457 thousand in 2021, 2020 and 2019, respectively. Determining whether particular costs incurred are more properly attributable to the preliminary or conceptual stage, and thus expensed, or to the application development phase, and thus capitalized and amortized, depends on subjective judgments about the nature of the development work, and our judgments in this regard may differ from those made by other companies. General and administrative costs related to developing or obtaining such software is expensed as incurred.

Other Assets [Policy Text Block]

Other Assets

Other assets primarily consist of capitalized legal costs relating to patent applications. The Company amortizes these costs over the lesser of the legal life or estimated useful life of the patent from the date of grant of the applicable patent. The typical life is twenty years. As of December 31, 2021, the Company had capitalized legal costs relating to patent applications of $1.1 million with accumulated amortization of $0.4 million, for a net balance of $0.7 million. As of December 31, 2020, the Company had capitalized legal costs relating to patent applications of $1.0 million with accumulated amortization of $0.3 million, for a net balance of $0.7 million. Amortization expense was $62 thousand, $62 thousand, and $40 thousand in 2021, 2020 and 2019, respectively. The amount of amortization related to patent applications is expected to remain below $100 thousand per year for the next five years.

Revenue [Policy Text Block]

Revenue Recognition

The Company is in the business of performing drug testing services and reporting the results thereof. The Company’s services are primarily drug and alcohol testing for its customers for an agreed-upon fee per unit tested. The revenues are recognized when the drug test is performed and reported to the customer.

Revenue is recognized when control of the services is transferred to our customers, in an amount that reflects the consideration (none of which is variable) the Company expects to be entitled to in exchange for those services. The Company typically invoices customers monthly for services provided and payments are generally due within 30 to 60 days of the invoice date.

The table below disaggregates our external revenue by major source (in thousands). For additional revenue detail relating to geographic breakdown of sales, see Note 13 – “Business Segment Reporting”.

Year Ended December 31,

2021

2020

2019

Consolidated Revenue:

Testing
$ 21,894 $ 19,068 $ 34,555

Shipping / Collection (hair)
2,847 2,174 2,876

Other
168 118 247

Total Revenue
$ 24,909 $ 21,360 $ 37,678

Testing Revenue

Drug and alcohol tests for drugs of abuse using hair, performed in the Company’s forensic laboratory in California, represents our primary service. Sales to customers are initiated through sales agreements, most of which have standard terms. Most tests are identified through a chain of custody form (“CCF”) and can therefore be uniquely tracked. Revenue is recognized when performance obligations under the terms of the contract with a customer are satisfied; generally, this occurs with the transfer of control of our service, which occurs at a specific point-in-time. The specific point-in-time is the completion of the test and availability of test results to the customer. Most tests are completed the same day that the hair specimen is received.

Substantially all tests are completed within a few days once received for processing at our laboratory in California. As the tests are performed in a forensic laboratory, the exact date and time of each test completion is available and used in the timing of recognition of revenue.

Revenue is measured as the amount of consideration the Company expects to receive in exchange for providing services. Sales taxes the Company pays concurrent with revenue-producing activities are excluded from revenue.

Shipping and Hair Collection Revenue

Shipping revenue represents the amount billed to customers related to shipping of the hair specimen and CCF (collectively called the “sample”) to the Company’s laboratory. Collection revenue represents the amount billed to customers related to the collection of the hair specimen. This collection is done by third parties who have contracted with the Company. Shipping and hair collection revenue is recognized when performance obligations under the terms of the contract with a customer are satisfied; generally, this occurs with the transfer of control of the Company’s service, which occurs at a specific point-in-time. The specific point-in-time is the completion of the test (associated with the shipping or hair collection charge) and availability of test results to the customer.

Revenue is measured as the amount of consideration the Company expects to receive in exchange for providing services. As the Company controls the service before transferring to the customer, it is considered a principal in the transaction, and therefore records revenues on gross basis, with shipping and hair collection costs in costs of revenues.

Other Revenue

Other revenue represents several items including: urine testing performed by other labs, medical review officer charges, legal/testifying services, and other miscellaneous charges. The total of all these items is less than 1% of total revenue. The amounts are generally billed to customers as services are performed, which occurs at a specific point-in-time.

Practical Expedients and Exemptions

The Company generally expenses sales commissions when incurred as they are typically not related to costs to fulfill customer contracts but relate to overall sales targets. These costs are recorded within marketing and selling expense on the accompanying consolidated statements of operations.

Research and Development Expense, Policy [Policy Text Block]

Research and Development Expenses

The Company expenses all research and development costs as incurred.

Contingent Liability Reserve Estimate, Policy [Policy Text Block]

Contingencies

Loss contingencies from legal proceedings and claims may occur from government investigations, shareholder lawsuits, product liability, contractual claims, tax and other matters. Accruals are recognized when it is probable that a liability will be incurred, and the amount of loss can be reasonably estimated. Legal fees are expensed as incurred.

Income Tax, Policy [Policy Text Block]

Income Taxes

The Company accounts for income taxes using the liability method pursuant to ASC 740, “Income Taxes”. Under this method, the Company recognizes deferred tax assets and liabilities for the expected tax consequences of temporary differences between the tax bases of assets and liabilities and their reported amounts using enacted tax rates in effect for the year the differences are expected to reverse. The Company evaluates uncertain tax positions annually and considers whether the amounts recorded for income taxes are adequate to address the Company’s tax risk profile. The Company analyzes the potential tax liabilities of specific transactions and tax positions based on management’s judgment as to the expected outcome.

Concentration Risk, Credit Risk, Policy [Policy Text Block]

Concentration of Credit Risk and Off-Balance Sheet Risk

The Company has no significant off-balance-sheet risk such as foreign exchange contracts, option contracts, or other foreign hedging arrangements. Financial instruments that potentially subject the Company to concentrations of credit risk are principally cash and accounts receivable. The Company’s policy is to place its cash in high quality financial institutions. At time, these deposits may exceed or be exempt from federally insured limits. The Company does not believe significant credit risk exists with respect to these institutions. Concentration of credit risk with respect to accounts receivable is limited to certain customers to whom the Company makes substantial sales. To reduce risk, the Company routinely assesses the financial strength of its customers and, as a consequence, believes that its accounts receivable credit risk exposure is limited. The Company maintains an allowance for potential credit losses but historically has not experienced any significant losses related to individual customers or groups of customers in any particular industry or geographic area. The Company does not require collateral.

Major Customers, Policy [Policy Text Block]

Significant Customers and Concentration of Credit Risk

The Company had no customers that represented 10% or more of total revenue for the years ended December 31, 2021, and 2020, respectively. The Company had one customer that represented 26% of total revenue for the year ended December 31, 2019. The Company had no customers account for 10% or more of the total accounts receivable balance as of December 31, 2021, and 2020, respectively.

Share-based Payment Arrangement [Policy Text Block]

Stock-Based Compensation

The Company accounts for equity awards in accordance with ASC 718, “Compensation — Stock Compensation” (“ASC 718”). ASC 718 requires employee equity awards to be accounted for under the fair value method. It also requires the measurement of compensation cost at fair value on the date of grant and recognition of compensation expense over the service period for awards expected to vest. Accordingly, share-based compensation is measured at the grant date based on the fair value of the award. The Company uses the straight-line method to recognize share-based compensation over the service period of the award, which is generally equal to the vesting period. The Company uses the simplified approach to calculate the expected exercise date of options, which is one of the components used to determine the fair value of the options. This approach is used due to the small number of recipients receiving stock options not providing a reasonable basis for estimating expected term. In 2016, the Company adopted ASU 2016-09, Improvements to Employee Share-Based Payment Accounting, which simplifies several aspects of the accounting for employee share-based payment transactions including the accounting for income taxes, forfeitures, and statutory tax withholding requirements, as well as classification of related amounts within the statement of cash flows. As a result, we recognize the impact of forfeitures when they occur with no adjustment for estimated forfeitures and recognize excess tax benefits as a reduction of income tax expense regardless of whether the benefit reduces income taxes payable.

Stock compensation expense by income statement account is as follows (in thousands):

	Year Ended December 31,
	2021		2020		2019
Cost of revenues	$	63	$	50	$	59
General & administrative		503		380		579
Marketing & selling		114		74		54
Research & development		63		59		67
Total stock compensation	$	743	$	563	$	759

See Note 7 – “Stock-Based Awards” for additional information relating to the Company’s stock plan.

Earnings Per Share, Policy [Policy Text Block]

Basic and Diluted Net Income (Loss) per Share

Basic net income (loss) per share is computed by dividing net income (loss) available to common shareholders by the weighted average number of common shares outstanding during the period. Diluted net income per share is computed by dividing net income (loss) available to common shareholders by the weighted average number of common shares and dilutive common stock equivalents outstanding during the period. The number of dilutive common stock equivalents outstanding during the period has been determined in accordance with the treasury-stock method. Common equivalent shares consist of common stock issuable upon the exercise of outstanding options and the unvested portion of stock unit awards (“SUAs”).

Basic and diluted weighted average common shares outstanding are as follows (in thousands):

	2021		2020		2019
Weighted average common shares outstanding, basic		5,549		5,524		5,514
Dilutive common equivalent shares		-		-		11
Weighted average common shares outstanding, assuming dilution		5,549		5,524		5,525

For the years ended December 31, 2021, 2020 and 2019, options to purchase 545 thousand, 588 thousand and 357 thousand common shares were outstanding but not included in the dilutive common equivalent share calculation as their effect would have been anti-dilutive.

Fair Value of Financial Instruments, Policy [Policy Text Block]

Financial Instruments

Financial instruments include cash, accounts receivable and accounts payable. Estimated fair values of these financial instruments approximate carrying values due to their short-term nature. The Company has two outstanding equipment loans. One had an interest rate of the 30-day LIBOR rate + 1.75% and the other has a fixed interest rate of 3.79%. As there is a market interest rate, the carrying amount is fair value.

Basis of Presentation and Consolidation, Policy [Policy Text Block]

Basis of Preparation and Consolidation

The consolidated financial statements include the financial statements of the Company and its wholly-owned subsidiaries have been prepared using accounting principles generally accepted in the United States (“U.S. GAAP”). All intercompany transactions and balances have been eliminated.

Foreign Currency Transactions and Translations Policy [Policy Text Block]

Foreign Currency Translation

To the extent sales are made through our Brazil subsidiary, such sales are transacted in Brazilian Real and translated into US dollars. Foreign currency denominated assets and liabilities are translated into U.S. dollars using the exchange rates in effect at the consolidated balance sheet date. Results of operations and cash flows are translated using the average exchange rates throughout the period. The effect of exchange rate fluctuations on translation of assets and liabilities that are in the functional currency is included as a component of shareholders’ equity in accumulated other comprehensive income (loss). The total change in foreign currency translation adjustment for the year ended December 31, 2021, and 2020, respectively was an immaterial amount.

New Accounting Pronouncements, Policy [Policy Text Block]

Recently Adopted Accounting Pronouncements

In December 2019, the FASB issued ASU 2019-12, “Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes”. The amendments in this update simplify the accounting for income taxes by removing certain exceptions to the general principles in ASU Topic 740. The amendments also improve consistent application of and simplify U.S. GAAP for other areas of ASU Topic 740 by clarifying and amending existing guidance. The amendments in this update are effective for interim and annual periods for the Company beginning after December 15, 2020, with early adoption permitted. The Standard may be adopted using the prospective or retrospective transition approach and could be applied to a modified retrospective basis through a cumulative-effect adjustment to retained earnings as of the beginning of the fiscal year adoption. The Company adopted ASU 2019-12 as of January 1, 2021, with no material impact to the Company’s consolidated financial statements.

Note 10 - Operating Leases (Details Textual) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Operating Lease, Weighted Average Discount Rate, Percent	3.90%
Operating Lease, Weighted Average Remaining Lease Term (Year)	4 years
Operating Lease, Expense	$ 1.1	$ 1.1	$ 1.2

Note 7 - Stock-based Awards (Details Textual) - USD ($) $ / shares in Units, $ in Thousands							12 Months Ended
	May 13, 2021	Mar. 16, 2021	Jan. 25, 2021	Dec. 16, 2020	Nov. 11, 2020	May 03, 2019	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2006	May 31, 2021	Jan. 31, 2019
Share Price (in dollars per share)					$ 1.13	$ 2.99	$ 7.02	$ 5.09
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Weighted Average Grant Date Fair Value (in dollars per share)							$ 3.47		$ 3.40
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested in Period, Fair Value							$ 296	$ 274	$ 223
Conversion of Stock, Amount Issued							501	$ 115	$ 144
Share-based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Amount, Total							$ 1,200
Share-based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Period for Recognition (Year)							2 years 10 months 24 days
Stock Unit Award [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period (in shares)	115,500	2,000,000	1,500				119,000
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period, Weighted Average Grant Date Fair Value (in dollars per share)							$ 6.55	$ 4.89	$ 12.01
Stock Unit Award [Member] \| Share-based Payment Arrangement, Nonemployee [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period (Year)				2 years
Stock Unit Award [Member] \| Share-based Payment Arrangement, Employee [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period (Year)				4 years
Share-based Payment Arrangement, Option [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Expiration Period (Year)				10 years
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Weighted Average Grant Date Fair Value (in dollars per share)					$ 4.07	$ 10.60
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Volatility Rate					45.00%	41.00%
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Risk Free Interest Rate					0.90%	2.40%
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Dividend Rate					4.00%	3.90%
Share-based Payment Arrangement, Option [Member] \| Share-based Payment Arrangement, Nonemployee [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period (Year)				2 years
Minimum [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period (Year)							2 years
Minimum [Member] \| Share-based Payment Arrangement, Option [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Term (Year)					5 years 9 months	5 years 9 months
Maximum [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period (Year)							4 years
Maximum [Member] \| Share-based Payment Arrangement, Option [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Term (Year)					6 years 3 months	6 years 3 months
Maximum [Member] \| Share-based Payment Arrangement, Option [Member] \| Share-based Payment Arrangement, Employee [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period (Year)				4 years
Incentive Plan 2006 [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Expiration Period (Year)										10 years
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Available for Grant (in shares)							285,000				1,600,000	1,200,000
Common Stock, Capital Shares Reserved for Future Issuance (in shares)							844,000

Note 4 - Accrued Expenses

12 Months Ended

Dec. 31, 2021

Notes to Financial Statements

Accounts Payable and Accrued Liabilities Disclosure [Text Block]

4. Accrued Expenses

Accrued expenses consist of the following (in thousands):

	As of December 31,
	2021		2020
Accrued compensation and employee benefits	$	507	$	315
Accrued vacation expense		373		379
Accrued taxes		200		4
Accrued shipping expense		488		511
Accrued legal settlement		1,150		-
Other accrued expenses		470		592
Total Accrued Expenses	$	3,188	$	1,801

Note 13 - Business Segment Reporting - Revenue by Major Source (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Revenues	$ 24,909	$ 21,360	$ 37,678
UNITED STATES
Revenues	23,584	19,486	27,329
BRAZIL
Revenues	640	1,344	9,819
Other Foreign Countries [Member]
Revenues	$ 685	$ 530	$ 530

- Definition

+ References

+ Details

Note 10 - Operating Leases

12 Months Ended

Dec. 31, 2021

Notes to Financial Statements

Lessee, Operating Leases [Text Block]

10. Operating Leases

The Company has five operating leases for office and laboratory space used to conduct business. The exercise of lease renewal options is at our discretion and there are no renewals to extend the lease terms included in our Right-Of-Use (“ROU”) assets and lease liabilities as they are not reasonably certain of exercise. The Company regularly evaluates the renewal options and when they are reasonably certain of exercise. As most of the Company’s leases do not provide an implicit rate, the Company uses the incremental borrowing rate based on the information available at the lease commencement date in determining the net present value (NPV) of the lease payments.

The weighted average discount rate used for leases as of December 31, 2021 is 3.9%. The weighted average lease term as of December 31, 2021, is 4.0 years. The operating lease expense for the twelve months ended December 31, 2021, and 2020, was $1.1 million and $1.1 million, respectively.

Maturities and balance sheet presentation of the Company’s lease liabilities for all operating leases as of December 31, 2021, is as follows (in thousands):

2022	$	1,117
2023		1,118
2024		1,034
2025		592
2026		460
Total lease payments		4,321
Less interest:		( 457	)
Present value of lease liabilities	$	3,864

Current operating lease liabilities	$	984
Long-term operating lease liabilities		2,880
Total	$	3,864

Note 7 - Stock-based Awards - Nonvested Award Activity (Details) - Stock Unit Award [Member] - $ / shares

12 Months Ended

May 13, 2021

Mar. 16, 2021

Jan. 25, 2021

Dec. 31, 2021

Outstanding & Unvested at beginning of period (in shares)

166,000

Outstanding & Unvested at beginning of period, weighted average price per share (in dollars per share)

^[1]

$ 4.50

Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period (in shares)

115,500

2,000,000

1,500

119,000

Granted, weighted average price per share (in dollars per share)

^[1]

$ 6.55

Converted to common stock (in shares)

(52,000)

Converted to common stock, weighted average price per share (in dollars per share)

^[1]

$ 4.89

Cancelled (in shares)

(9,000)

Cancelled, weighted average price per share (in dollars per share)

^[1]

$ 4.94

Outstanding & Unvested at end of period (in shares)

224,000

Outstanding & Unvested at end of period, weighted average price per share (in dollars per share)

^[1]

$ 5.48

[1]	Weighted average price per share is the weighted grant price based on the closing market price of each of the stock grants related to each transaction type. The weighted average fair value is the weighted average share price times the number of shares.

Note 2 - Summary of Significant Accounting Policies - Summary of Useful Lives of Assets (Details)	12 Months Ended
	Dec. 31, 2021
Minimum [Member] \| Office Equipment [Member]
Property, plant and equipment, useful life (Year)	3 years
Minimum [Member] \| Laboratory Equipment [Member]
Property, plant and equipment, useful life (Year)	5 years
Minimum [Member] \| Computer Software, Intangible Asset [Member]
Property, plant and equipment, useful life (Year)	3 years
Maximum [Member] \| Office Equipment [Member]
Property, plant and equipment, useful life (Year)	7 years
Maximum [Member] \| Laboratory Equipment [Member]
Property, plant and equipment, useful life (Year)	7 years
Maximum [Member] \| Computer Software, Intangible Asset [Member]
Property, plant and equipment, useful life (Year)	5 years

Note 5 - Income Taxes (Tables)

12 Months Ended

Dec. 31, 2021

Notes Tables

Schedule of Components of Income Tax Expense (Benefit) [Table Text Block]

	Year Ended December 31,
	2021			2020			2019
Current –
Federal	$	131		$	( 2,006	)	$	1,478
State		84			( 2	)		54
Foreign		-			-			348
Total Current Deferred –		215			( 2,008	)		1,880
Federal		( 704	)		( 13	)		( 139	)
State		333			( 326	)		( 227	)
Total Deferred		( 371	)		( 339	)		( 366	)
Income Tax Provision	$	( 156	)	$	( 2,347	)	$	1,514

Schedule of Effective Income Tax Rate Reconciliation [Table Text Block]

	Year Ended December 31,
	2021			2020			2019
Federal statutory rate		21.0	%		21.0	%		21.0	%
State income taxes, net of federal benefit		10.4	%		4.4	%		(4.5%	)
Permanent differences		47.6	%		0.0	%		-8.1	%
Stock based compensation		1.4	%		(0.4%	)		1.3	%
Federal R&D Credits		0.0	%		1.6	%		-4.7	%
Foreign taxes, net of federal benefit		(10.9%	)		(2.2%	)		44.5	%
Difference in tax rate for carryback claim		0.0	%		13.4	%		0.0	%
Increase/(decrease) in valuation reserve		(50.5%	)		0.0	%		0.0	%
Effective tax rate		19.0	%		37.8	%		49.5	%

Schedule of Deferred Tax Assets and Liabilities [Table Text Block]

	As of December 31,
	2021			2020
Deferred Tax Assets
Allowance for doubtful accounts	$	21		$	9
Accrued expenses		129			112
Stock-based compensation		325			265
R&D tax credits		1,083			1,005
Operating lease		944			1,130
PPP Loan expenses		-			9
NOL carryforward		219			97
Gross Deferred Tax Assets		2,721			2,627
Valuation Allowance		( 414	)		-
Deferred Tax Assets After Valuation Allowance		2,307			2,627

Deferred Tax Liabilities
Excess of tax over book depreciation and amortization		( 1,249	)		( 1,775	)
Prepaid expenses		( 61	)		( 48	)
Operating lease		( 837	)		( 1,015	)
Gross Deferred Tax Liabilities		( 2,147	)		( 2,838	)

Net Deferred Tax Assets/(Liabilities)	$	160		$	( 211	)

Note 7 - Stock-based Awards - Stock Option Activity (Details) - USD ($)
$ / shares in Units, shares in Thousands, $ in Millions

12 Months Ended

Dec. 31, 2021

Dec. 31, 2020

Outstanding (in shares)

604

Outstanding, weighted average exercise price (in dollars per share)

$ 14.31

Outstanding, weighted average remaining contractual life (Year)

6 years 1 month 6 days

7 years

Exercised (in shares)

(1)

Exercised, weighted average exercise price (in dollars per share)

$ 4.07

Forfeited (in shares)

(29)

Forfeited, weighted average exercise price (in dollars per share)

$ 3.47

Outstanding (in shares)

574

604

Outstanding, weighted average exercise price (in dollars per share)

$ 14.23

$ 14.31

Outstanding, aggregate intrinsic value

^[1]

$ 0.1

Exercisable (in shares)

464

Exercisable, weighted average exercise price (in dollars per share)

$ 15.12

Exercisable, weighted average remaining contractual life (Year)

5 years 8 months 12 days

[1]

The aggregate intrinsic value on this table was calculated based on the amount, if any, by which the closing market price of the Company’s stock on December 31 of the applicable year exceeded the exercise price of any of the underlying options, multiplied by the number of shares subject to each such option. The closing stock price as of December 31, 2021, and 2020 was $7.02 and $5.09, respectively.

Note 9 - Commitments and Contingencies (Details Textual) - USD ($) $ in Thousands		1 Months Ended	12 Months Ended
	Dec. 06, 2021	Sep. 30, 2021	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Operating Lease, Expense			$ 1,100	$ 1,100	$ 1,200
Settlement With Customer [Member]
Payments for Legal Settlements		$ 200
Loss Contingency Accrual, Ending Balance		$ 0
Enma Sagastume v. Psychemedics Corporation [Member]
Loss Contingency Accrual, Ending Balance			$ 1,200
Litigation Settlement, Amount Awarded to Other Party	$ 1,200

Note 11 - Debt and Other Financing Arrangements - Schedule of Debt Repayments (Details) - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020
Less current portion of long-term debt from equipment financing	$ (664)	$ (688)
Long-term debt from equipment financing, net of current portion	599	$ 3,444
Equipment Loan Arrangement [Member]
2022	664
2023	294
2024	305
Long-term debt from equipment financing	1,263
Less current portion of long-term debt from equipment financing	(664)
Long-term debt from equipment financing, net of current portion	$ 599

- Definition

Amount, after unamortized (discount) premium and debt issuance costs, of long-term debt. Includes, but not limited to, notes payable, bonds payable, debentures, mortgage loans and commercial paper. Excludes capital lease obligations.

+ References + Details

Note 1 - Nature of Business (Details Textual) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020
Income Tax Benefit CARES Act	$ 2,600	$ 200
Cash and Cash Equivalents, at Carrying Value, Ending Balance	$ 1,992	$ 2,833

Note 5 - Income Taxes - Reconciliation of Effective Rate with Federal Statutory Rate (Details)	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Federal statutory rate	21.00%	21.00%	21.00%
State income taxes, net of federal benefit	10.40%	4.40%	(4.50%)
Permanent differences	47.60%	0.00%	(8.10%)
Stock based compensation	1.40%	(0.40%)	1.30%
Federal R&D Credits	0.00%	1.60%	(4.70%)
Foreign taxes, net of federal benefit	(10.90%)	(2.20%)	44.50%
Difference in tax rate for carryback claim	0.00%	13.40%	0.00%
Increase/(decrease) in valuation reserve	(50.50%)	0.00%	0.00%
Effective tax rate	19.00%	37.80%	49.50%

Consolidated Statements of Shareholders' Equity - USD ($) $ in Thousands	Common Stock [Member]	Additional Paid-in Capital [Member]	Treasury Stock [Member]	Retained Earnings [Member]	AOCI Attributable to Parent [Member]	Total
Balance (in shares) at Dec. 31, 2018	6,175,000		668,000
Balance at Dec. 31, 2018	$ 31	$ 31,523	$ (10,082)	$ (1,326)	$ (1,399)	$ 18,747
Shares issued – vested (in shares)	10,000
Tax withholding related to vested shares from employee stock plans	$ 0	(33)	0	0	0	(33)
Stock compensation expense		759				759
Cash dividends declared	0	0	0	(3,970)	0	(3,970)
Net (loss) income				1,542		1,542
Foreign currency translation, net of taxes	$ 0	0	$ 0	0	(225)	(225)
Balance (in shares) at Dec. 31, 2019	6,185,000		668,000
Balance at Dec. 31, 2019	$ 31	32,249	$ (10,082)	(3,754)	(1,624)	16,820
Shares issued – vested (in shares)	20,000		0
Tax withholding related to vested shares from employee stock plans	$ 0	(9)	$ 0	0	0	(9)
Stock compensation expense	0	563	0	0	0	563
Cash dividends declared	0	0	0	(993)	0	(993)
Net (loss) income	0	0	0	(3,859)	0	(3,859)
Foreign currency translation, net of taxes	$ 0	0	$ 0	0	(10)	(10)
Balance (in shares) at Dec. 31, 2020	6,205,000		668,000
Balance at Dec. 31, 2020	$ 31	32,803	$ (10,082)	(8,606)	(1,634)	12,512
Shares issued – vested (in shares)	51,000		0
Tax withholding related to vested shares from employee stock plans	$ 0	(72)	$ 0	0	0	(72)
Stock compensation expense	0	743	0	0	0	743
Cash dividends declared	0	0	0	(279)	0	(279)
Net (loss) income	$ 0	0	$ 0	(665)	0	(665)
Foreign currency translation, net of taxes						$ 0
Exercise of stock options (in shares)	1		0			1,000
Exercise of stock options	$ 0	4	$ 0	0	0	$ 4
Balance (in shares) at Dec. 31, 2021	6,257,000		668,000
Balance at Dec. 31, 2021	$ 31	$ 33,478	$ (10,082)	$ (9,550)	$ (1,634)	$ 12,243

Note 9 - Commitments and Contingencies

12 Months Ended

Dec. 31, 2021

Notes to Financial Statements

Commitments and Contingencies Disclosure [Text Block]

9. Commitments and Contingencies

Commitments

The Company leases certain of its facilities and equipment under operating lease agreements expiring on various dates through December 2026. Total minimum lease payments, including scheduled increases, are charged to operations on the straight-line basis over the life of the respective lease. Rent expense was $1.1 million, $1.1 million and $1.2 million in 2021, 2020 and 2019, respectively. See Note 10 – “Operating Leases” for commitments remaining under lease agreements.

Contingencies

In the normal course of business, we are subject to contingencies, such as legal proceedings and claims arising out of our business, that cover a wide range of matters, including, among others, government investigations, shareholder lawsuits, product liability, contractual claims and tax matters. We recognize accruals for such contingencies when it is probable that a liability will be incurred and the amount of the loss can be reasonably estimated. These estimates are subject to uncertainties that are difficult to predict and, as such, actual results could vary from these estimates.

Settlements

On September 23, 2021, the Company entered into a settlement agreement to resolve a contract dispute regarding the Company’s alleged contractual obligations to a customer involved in litigation with certain of the customer’s former employees regarding their employment termination (the “September 2021 Settlement Agreement”). The Company was not a party to any of these wrongful termination claims and the customer was in control of defending each claim. Pursuant to the September 2021 Settlement Agreement, the Company agreed to pay the customer an aggregate of $1.9 million in addition to $0.2 million that will be paid by the Company’s insurers, in full settlement and release of the dispute. The September 2021 Settlement Agreement includes other customary terms and includes confidentiality provisions between the parties. Neither party has admitted any liability or fault by entering into the September 2021 Settlement Agreement. The Company previously declined to continue its contractual relationship with the customer. The Company funded its payment obligation in full under the September 2021 Settlement Agreement through existing cash on hand. There was no liability reserve in connection with the September 2021 Settlement Agreement as of December 31, 2021.

On December 6, 2021, the Company entered into a binding Memorandum of Understanding (the “MOU”) to settle a purported class action lawsuit against it related to certain California wage and hour laws. The lawsuit, Enma Sagastume v. Psychemedics Corporation, Case No. 2:20-CV-06624-DSF, is pending in the United States District Court for the Central District of California (the “California Lawsuit”) and is similar to numerous lawsuits filed against employers with operations in California.

In the binding MOU, the parties agreed to settle this matter for a payment by the Company of $1.2 million in exchange for the dismissal of the California Lawsuit and a customary release of liability, subject only to final court approval and the process described below. Factoring in that process, the Company estimates that the settlement funds will be dispersed in the second half of 2022, subject to the actual timing of final court approval.

Although the Company believes that the allegations in the California Lawsuit lack merit, it agreed at a mediation to enter into the binding MOU to settle the claims in the California Lawsuit in order to avoid potentially significant legal fees, other expenses, and management time that would have to be devoted to protracted litigation in California regarding its wage and hour laws. The foregoing was also impacted in part by new California case law in February 2021 regarding meal period compliance. The allegations in the California Lawsuit relate to alleged discrepancies in compliance with meal and rest periods required by California law and other alleged compliance discrepancies relating to the California wage and hour laws with respect to non-exempt hourly employees of the Company in California for a period since June 9, 2017. The California Lawsuit sought recovery of wages, penalties, interest, attorneys’ fees and other alleged damages. As part of the settlement, the Company continues to deny any liability or wrongdoing with respect to the claims made in the California Lawsuit.

The MOU assumes class certification for purposes of the settlement only. The settlement amount of $1.2 million, which includes plaintiff attorneys' fees and costs, is subject to potential increase based on any adjustments in the final class size and the exact period to be covered, as determined by the court’s final approval. However, the Company believes that such adjustments, if any, would likely be immaterial. Once court approved, in exchange for the settlement payment, the plaintiff and all class members who do not opt out of the settlement will provide a broad release of any liability relating to the subject matter of the California Lawsuit, including any claims of such persons under California’s Private Attorneys' General Act of 2004. Such release is for the benefit of the Company, its affiliates, and any successor to the Company. The Company has the right to revoke the settlement prior to court approval in the event opt-outs, if any, from the class membership exceed a specified level. While the settlement is subject to final court approval as is customary, the MOU expressly provides that it is binding on and enforceable by each of the parties thereto, including by any successor to the Company. There is a $1.2 million liability reserve in connection with the California Lawsuit as of December 31, 2021.

Note 10 - Operating Leases (Tables)

12 Months Ended

Dec. 31, 2021

Notes Tables

Lessee, Operating Lease, Liability, Maturity [Table Text Block]

2022	$	1,117
2023		1,118
2024		1,034
2025		592
2026		460
Total lease payments		4,321
Less interest:		( 457	)
Present value of lease liabilities	$	3,864

Current operating lease liabilities	$	984
Long-term operating lease liabilities		2,880
Total	$	3,864

Note 7 - Stock-based Awards - Summary of Shares Granted Under the 2006 Incentive Plan (Details)
shares in Thousands

12 Months Ended

Dec. 31, 2021

$ / shares

November 11, 2020 [Member]

Shares granted (in shares) | shares

Fair value per share (in dollars per share) | $ / shares

$ 1.13

^[1]

May 3, 2019 [Member]

Shares granted (in shares) | shares

192

Fair value per share (in dollars per share) | $ / shares

$ 2.99

^[1]

Stock Unit Award [Member] | May 13, 2021 [Member]

Shares granted (in shares) | shares

116

Fair value per share (in dollars per share) | $ / shares

$ 6.55

^[1]

Stock Unit Award [Member] | March 16, 2021 [Member]

Shares granted (in shares) | shares

Fair value per share (in dollars per share) | $ / shares

$ 7.04

^[1]

Stock Unit Award [Member] | January 25, 2021 [Member]

Shares granted (in shares) | shares

Fair value per share (in dollars per share) | $ / shares

$ 5.54

^[1]

Stock Unit Award [Member] | December 16, 2020 [Member]

Shares granted (in shares) | shares

Fair value per share (in dollars per share) | $ / shares

$ 4.71

^[1]

Stock Unit Award [Member] | November 11, 2020 [Member]

Shares granted (in shares) | shares

190

Fair value per share (in dollars per share) | $ / shares

$ 4.07

^[1]

Stock Unit Award [Member] | May 3, 2019 [Member]

Shares granted (in shares) | shares

Fair value per share (in dollars per share) | $ / shares

$ 10.60

[1]

The fair value for the SUA’s is the closing price of the Company’s stock on that date. The fair value for options represents the fair value calculated using the Black-Scholes model. Options have contractual lives of 10 years. The options granted on May 3, 2019, have a fair value of $2.99 per share based on the $10.60 grant date and exercise prices and assuming 6.25 and 5.75 year estimated terms, 41% volatility, 2.4% interest rate and a 3.9% dividend yield rate. The options granted on November 11, 2020, have a fair value of $1.13 per share based on the $4.07 grant date and exercise prices and assuming 6.25 and 5.75 year estimated terms, 45% volatility, 0.9% interest rate and a 4.0%dividend yield rate. No options were granted during fiscal year ended December 31, 2021. For options granted during fiscal years ended December 31, 2020, and 2019, the weighted average grant date fair values were $3.47, and $3.40,respectively. For SUAs granted during fiscal years ended December 31, 2021, 2020 and 2019, the weighted average grant date fair values were $6.55, $4.89, and $12.01, respectively.

Note 13 - Business Segment Reporting

12 Months Ended

Dec. 31, 2021

Notes to Financial Statements

Segment Reporting Disclosure [Text Block]

13. Business Segment Reporting

The Company manages its operations as one segment, drug testing services. As a result, the financial information disclosed herein materially represents all the financial information related to the Company’s principal operating segment. All Brazil sales were though one independent distributor. The Company’s revenues by geographic region, based on the location of the customer, were as follows (in thousands):

		Year Ended December 31,
		2021		2020		2019
Consolidated Revenue:
United States	$	23,584	$	19,486	$	27,329
Brazil		640		1,344		9,819
Other		685		530		530
Total Revenue	$	24,909	$	21,360	$	37,678

- Definition

The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments.

+ References

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+ Details

Note 4 - Accrued Expenses - Summary of Accrued Expenses (Details) - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020
Accrued compensation and employee benefits	$ 507	$ 315
Accrued vacation expense	373	379
Accrued taxes	200	4
Accrued shipping expense	488	511
Accrued legal settlement	1,150	0
Other accrued expenses	470	592
Total Accrued Expenses	$ 3,188	$ 1,801

Note 5 - Income Taxes

12 Months Ended

Dec. 31, 2021

Notes to Financial Statements

Income Tax Disclosure [Text Block]

5. Income Taxes

The income tax provision consists of the following (in thousands):

	Year Ended December 31,
	2021			2020			2019
Current –
Federal	$	131		$	( 2,006	)	$	1,478
State		84			( 2	)		54
Foreign		-			-			348
Total Current Deferred –		215			( 2,008	)		1,880
Federal		( 704	)		( 13	)		( 139	)
State		333			( 326	)		( 227	)
Total Deferred		( 371	)		( 339	)		( 366	)
Income Tax Provision	$	( 156	)	$	( 2,347	)	$	1,514

A reconciliation of the effective rate with the federal statutory rate is as follows:

	Year Ended December 31,
	2021			2020			2019
Federal statutory rate		21.0	%		21.0	%		21.0	%
State income taxes, net of federal benefit		10.4	%		4.4	%		(4.5%	)
Permanent differences		47.6	%		0.0	%		-8.1	%
Stock based compensation		1.4	%		(0.4%	)		1.3	%
Federal R&D Credits		0.0	%		1.6	%		-4.7	%
Foreign taxes, net of federal benefit		(10.9%	)		(2.2%	)		44.5	%
Difference in tax rate for carryback claim		0.0	%		13.4	%		0.0	%
Increase/(decrease) in valuation reserve		(50.5%	)		0.0	%		0.0	%
Effective tax rate		19.0	%		37.8	%		49.5	%

The change in effective tax rate from 2020 to 2021 was primarily driven by the Company’s 2020 carryback claim for the net loss as well as an increase to the valuation allowance in 2021 and a decrease in foreign taxes and federal tax credits in 2021, which were partially offset by the debt forgiveness and an increase in state taxes due to the CA research credits. As of December 31, 2021, the Company had $0.3 million of federal net operating loss carryforwards which do not expire. As of December 31, 2021, the Company had $2.6 million of state net operating loss carryforwards, of which $2.4 million expire at various dates between 2030 and 2041, and $0.2 million do not expire. As of December 31, 2021, the Company had $0.1 million of federal tax credit carryforwards that expire in 2040 and there were $1.2 million of California tax credit carryforwards relating to the years 2013 through 2021 which have an unlimited carryforward period. In 2021, the 10.4% state income tax effective rate primarily consisted of California research tax credits of 9.4%.

The components of the net deferred tax liabilities included in the accompanying balance sheets are as follows (in thousands):

	As of December 31,
	2021			2020
Deferred Tax Assets
Allowance for doubtful accounts	$	21		$	9
Accrued expenses		129			112
Stock-based compensation		325			265
R&D tax credits		1,083			1,005
Operating lease		944			1,130
PPP Loan expenses		-			9
NOL carryforward		219			97
Gross Deferred Tax Assets		2,721			2,627
Valuation Allowance		( 414	)		-
Deferred Tax Assets After Valuation Allowance		2,307			2,627

Deferred Tax Liabilities
Excess of tax over book depreciation and amortization		( 1,249	)		( 1,775	)
Prepaid expenses		( 61	)		( 48	)
Operating lease		( 837	)		( 1,015	)
Gross Deferred Tax Liabilities		( 2,147	)		( 2,838	)

Net Deferred Tax Assets/(Liabilities)	$	160		$	( 211	)

Income taxes are recorded in accordance with FASB ASC Topic 740, Income Taxes (“ASC 740”), which provides for deferred taxes using an asset and liability approach. The Company recognizes deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements or tax returns. Deferred tax assets and liabilities are determined based on the difference between the financial statement and tax bases of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. A valuation allowance is provided, if, based upon the weight of available evidence, it is more likely than not that some or all of the net deferred tax assets will not be realized.

ASC 740 contains a two-step approach to recognizing and measuring uncertain tax positions (tax contingencies). The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates it is more likely than not that the position will be sustained on an audit, including resolution of related appeals or litigation processes, if any. The second step is to measure the tax benefit as the largest amount which is more than 50% likely of being realized upon ultimate settlement. The Company considers many factors when evaluating and estimating the Company’s tax positions and tax benefits, which may require periodic adjustments and which may not accurately forecast actual outcomes. The Company had immaterial uncertain tax positions at December 31, 2021, and 2020, respectively.

The Company operates within multiple taxing jurisdictions and could be subject to audit in these jurisdictions. These audits may involve complex issues, which may require an extended period of time to resolve. The Company has provided for its estimated taxes payable in the accompanying financial statements. The Company’s policy is to recognize interest and penalties related to income tax matters as a general and administrative expense, when and if incurred. Interest and penalties for the years ended December 31, 2021, 2020 or 2019 were not material. In 2019, the I.R.S. completed a standard review of the Company’s 2016 tax year. The tax years ended December 31, 2018, through December 31, 2021, remain subject to examination by all major taxing authorities.

- Definition

The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
-Topic 740
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-URI http://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690

+ Details

Note 5 - Income Taxes - Summary of Income Tax Provision (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Federal	$ 131	$ (2,006)	$ 1,478
State	84	(2)	54
Foreign	0	0	348
Total Current Deferred –	215	(2,008)	1,880
Federal	(704)	(13)	(139)
State	333	(326)	(227)
Total Deferred	(371)	(339)	(366)
Income Tax Provision	$ (156)	$ (2,347)	$ 1,514

- Definition

Amount of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations.

+ References + Details

Note 3 - Accounts Receivable (Tables)

12 Months Ended

Dec. 31, 2021

Notes Tables

Financing Receivable, Current, Allowance for Credit Loss [Table Text Block]

	As of December 31,
	2021			2020
Balance, beginning of period	$	37		$	45
Provision for doubtful accounts		55			22
Write-offs		( 3	)		( 30	)
Balance, end of period	$	89		$	37

Note 12 - Other Expense

12 Months Ended

Dec. 31, 2021

Notes to Financial Statements

Other Income and Other Expense Disclosure [Text Block]

12. Other Expense

Other expense consists primarily of interest expense related to the Company’s equipment financing arrangement. Interest expense for the year ended December 31, 2021, 2020, and 2019 was $49 thousand, $75 thousand, and $59 thousand, respectively. There was no interest income for the years ended December 31, 2021, and 2020. Interest income for the year ended December 31, 2019, was $134 thousand.

Note 7 - Stock-based Awards

12 Months Ended

Dec. 31, 2021

Notes to Financial Statements

Share-based Payment Arrangement [Text Block]

7. Stock-Based Awards

The 2006 Incentive Plan initially adopted in 2006 provides for grants of options with terms of up to ten years, grants of restricted stock or stock unit awards (“SUAs”), issuances of stock bonuses or grants other stock-based awards plus cash-based awards, to officers, directors, employees, and consultants. Such shares are issuable out of the Company’s authorized but unissued common stock. In May 2021, the 2006 Incentive Plan was amended to increase the total number of shares issuable thereunder from 1.2 million to 1.6 million. As of December 31, 2021, 285 thousand shares remained available for future grant under the 2006 Incentive Plan.

The fair value of the SUAs is determined by the closing price on the date of grant. The fair value of options is determined using a Black-Scholes model. The SUAs and options vest over a period of two to four years and are convertible or exercisable into an equivalent number of shares of the Company’s common stock provided that the employee receiving the award remains continuously employed throughout the vesting period. The Company records stock compensation expense related to the SUAs and options on a straight-line basis over the vesting term. Employees are issued shares upon vesting of SUAs, net of tax withholdings. As a result of our adoption of ASU 2016-09 in 2016, we recognize the impact of forfeitures when they occur with no adjustment for estimated forfeitures and recognize excess tax benefits as a reduction of income tax expense regardless of whether the benefit reduces income taxes payable.

On January 25, 2021, the Company granted SUAs covering 1.5 thousand shares of common stock. On March 16, 2021, the Company granted SUAs covering two thousand shares of common stock. On May 13, 2021, the Company granted SUAs covering 115.5 thousand shares of common stock. The SUAs vest over a period of two years for non-employee board members and four years for employees and are convertible into an equivalent number of shares of the Company’s common stock provided that the director or employee receiving the award remains employed throughout the vesting period. The stock options become exercisable over two years for non-employee board members and four years for employees and have a term of 10 years. The Company records compensation expense related to the SUAs and options on a straight-line basis over the vesting term. Employees are issued shares upon vesting, in the case of SUA’s or upon exercise of options, net of tax withholdings, unless the employee chooses to receive all shares and pay for the associated employment taxes. Upon the exercise of a stock option, the Company issues authorized but unissued shares and delivers them to the recipient. The Company does not expect to repurchase shares to satisfy stock option exercises. No other types of equity-based awards have been granted or issued under the 2006 Incentive Plan.

The following table represents all shares granted by the Company under the 2006 Incentive Plan for the last three years (shares in thousands):

Grant Date

Type

Shares

Fair Value
Per Share (1)

May 13, 2021

SUA
116 $ 6.55

March 16, 2021

SUA
2 $ 7.04

January 25, 2021

SUA
2 $ 5.54

December 16, 2020

SUA
5 $ 4.71

November 11, 2020

Options
40 $ 1.13

November 11, 2020

SUA
190 $ 4.07

May 3, 2019

Options
192 $ 2.99

May 3, 2019

SUA
18 $ 10.60

(1)

The fair value for the SUA’s is the closing price of the Company’s stock on that date. The fair value for options represents the fair value calculated using the Black-Scholes model. Options have contractual lives of 10 years. The options granted on May 3, 2019, have a fair value of $2.99 per share based on the $10.60 grant date and exercise prices and assuming 6.25 and 5.75 year estimated terms, 41% volatility, 2.4% interest rate and a 3.9% dividend yield rate. The options granted on November 11, 2020, have a fair value of $1.13 per share based on the $4.07 grant date and exercise prices and assuming 6.25 and 5.75 year estimated terms, 45% volatility, 0.9% interest rate and a 4.0% dividend yield rate. No options were granted during fiscal year ended December 31, 2021. For options granted during fiscal years ended December 31, 2020, and 2019, the weighted average grant date fair values were $3.47, and $3.40, respectively. For SUAs granted during fiscal years ended December 31, 2021, 2020 and 2019, the weighted average grant date fair values were $6.55, $4.89, and $12.01, respectively.

A summary of the Company’s stock option activity is as follows (in thousands, except price per share):

Number of
Shares

Weighted Average
Exercise Price
Per Share

Weighted Average
Remaining Contractual
Life (years)

Aggregate
Intrinsic
Value⁽²⁾

Outstanding, December 31, 2020
604 $ 14.31 7.0 $ -

Granted
- $ -

Exercised
(1 ) $ 4.07

Forfeited
(29 ) $ 3.47

Outstanding, December 31, 2021
574 $ 14.23 6.1 $ 100

Exercisable, December 31, 2021
464 $ 15.12 5.7 $ -

(2)

The aggregate intrinsic value on this table was calculated based on the amount, if any, by which the closing market price of the Company’s stock on December 31 of the applicable year exceeded the exercise price of any of the underlying options, multiplied by the number of shares subject to each such option. The closing stock price as of December 31, 2021, and 2020 was $7.02 and $5.09, respectively.

A summary of the Company’s stock unit award activity is as follows (in thousands, except price per share):

Weighted Average

Number of
Grant-Date Fair Value

Shares

per Share⁽³⁾

Outstanding & Unvested, December 31, 2020
166 $ 4.50

Granted
119 $ 6.55

Converted to common stock
( 52 ) $ 4.89

Cancelled
( 9 ) $ 4.94

Forfeited
- $ -

Outstanding & Unvested, December 31, 2021
224 $ 5.48

(3)

Weighted average price per share is the weighted grant price based on the closing market price of each of the stock grants related to each transaction type. The weighted average fair value is the weighted average share price times the number of shares.

The fair value of stock unit award vesting was $296 thousand, $274 thousand and $223 thousand for the years ended December 31, 2021, 2020, and 2019, respectively. The intrinsic value of stock unit awards converted to common stock was based on the stock price on the vesting date and amounted to $501 thousand, $115 thousand and $144 thousand for the years ended December 31, 2021, 2020, and 2019, respectively.

As of December 31, 2021, a total of 844 thousand shares of common stock were reserved for issuance under 2006 Incentive Plan. As of December 31, 2021, the unamortized fair value of outstanding options and awards was $1.2 million to be amortized over a weighted average period of 2.9 years.

Note 6 - Preferred Stock

12 Months Ended

Dec. 31, 2021

Notes to Financial Statements

Preferred Stock [Text Block]

6. Preferred Stock

The Board of Directors has the authority to designate authorized preferred shares in one or more series and to fix the relative rights and preferences without vote or action by the stockholders. The Board of Directors has no present plans to designate or issue any shares of preferred stock.

Consolidated Statements of Cash Flows - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Cash flows from operating activities:
Net (loss) income	$ (665)	$ (3,859)	$ 1,542
Adjustments to reconcile net (loss) income to net cash provided by operating activities:
Forgiveness of PPP loan	(2,181)		0
Depreciation and amortization	2,784	2,691	2,914
ROU asset amortization	906	935	0
Deferred income taxes	(371)	(339)	(405)
Loss on sale of fixed assets		94	0
Non-cash interest income (expense)	0	0	33
Stock compensation expense	743	563	759
Changes in operating assets and liabilities:
Accounts receivable	(760)	424	1,049
Prepaid expenses and other current assets	(585)	392	64
Income tax receivable	(183)	(2,013)	(482)
Accounts payable	417	(281)	(494)
Operating lease liabilities	(1,078)	(914)	0
Accrued expenses	1,387	(1,776)	(671)
Net cash provided by (used in) operating activities	414	(4,083)	4,309
Cash flows from investing activities:
Proceeds from sale of fixed assets		140	0
Proceeds from short-term investments	0	0	3,810
Other assets	(38)	(7)	(56)
Purchases of property and equipment and capitalized software development costs	(182)	(991)	(1,677)
Net cash (used in) provided by investing activities	(220)	(858)	2,077
Cash flows from financing activities:
Cash dividends paid	(279)	(993)	(3,970)
Proceeds from stock options and tax withholding related to vested shares from employee stock plans	(68)	(9)	(33)
Payments of equipment financing	(688)	(678)	(415)
Net cash (used in) provided by financing activities	(1,035)	501	(3,002)
Effect of exchange rate changes on cash		(10)	(170)
Net (decrease) increase in cash and cash equivalents	(841)	(4,450)	3,214
Cash, beginning of year	2,833	7,283	4,069
Cash, end of year	1,992	2,833	7,283
Supplemental disclosures of cash flow information:
Cash paid for income taxes	405	249	2,898
Cash paid for interest	50	75	59
Cash paid for operating leases	1,151	1,038	1,199
Right-of-use assets acquired through operating leases	172	2,346	4,363
Non-cash investing and financing activities:
Purchases of equipment through accounts payable and accrued liabilities		241	1,882
Paycheck Protection Program CARES Act [Member]
Cash flows from financing activities:
Proceeds from long term det		2,181	0
Equipment Loan Arrangement [Member]
Cash flows from financing activities:
Proceeds from long term det	$ 0	$ 0	$ 1,416

Note 2 - Summary of Significant Accounting Policies (Tables)

12 Months Ended

Dec. 31, 2021

Notes Tables

Property, Plant and Equipment [Table Text Block]

Computer software (years)	3	to	5
Office furniture and equipment (years)	3	to	7
Laboratory equipment (years)	5	to	7
Leasehold improvements	Lesser of estimated useful life or lease term

Disaggregation of Revenue [Table Text Block]

	Year Ended December 31,
	2021		2020		2019
Consolidated Revenue:
Testing	$	21,894	$	19,068	$	34,555
Shipping / Collection (hair)		2,847		2,174		2,876
Other		168		118		247
Total Revenue	$	24,909	$	21,360	$	37,678

Schedule of Stock Based Compensation Expense [Table Text Block]

	Year Ended December 31,
	2021		2020		2019
Cost of revenues	$	63	$	50	$	59
General & administrative		503		380		579
Marketing & selling		114		74		54
Research & development		63		59		67
Total stock compensation	$	743	$	563	$	759

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

	2021		2020		2019
Weighted average common shares outstanding, basic		5,549		5,524		5,514
Dilutive common equivalent shares		-		-		11
Weighted average common shares outstanding, assuming dilution		5,549		5,524		5,525

Note 12 - Other Expense (Details Textual) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Interest Expense, Total	$ 49	$ 75	$ 59
Interest Income, Other	$ 0	$ 0	$ 134

Note 11 - Debt and Other Financing Arrangements

12 Months Ended

Dec. 31, 2021

Notes to Financial Statements

Debt Disclosure [Text Block]

11. Debt and Other Financing Arrangements

On March 20, 2014, the Company entered into an equipment financing arrangement with Banc of America Leasing & Capital, LLC (the “Lender”), which it amended on various dates, most recently on March 23, 2021, including a Master Loan and Security Agreement and related documentation (collectively the “Equipment Loan Arrangement”) which provided the Company with the ability to finance, at its option, up to $16 million of new and used equipment purchases. Each such purchase financed under the Equipment Loan Arrangement was documented by the execution of an equipment note with a maturity date of 60 months from the applicable loan date. The loans bore interest at the then current 30-day LIBOR rate plus a premium ranging from 1.75% to 3.79%. Principal and interest were payable over the 60-month repayment period. Borrowings under the Equipment Loan Arrangement were secured by a first priority security interest in the equipment acquired with the proceeds of the equipment notes. Under the Equipment Loan Arrangement, the Company has been subject to a maximum quarterly funded debt to EBITDA ratio and a minimum fixed charge coverage ratio each of which was waived for certain quarters in 2020 and 2021. The Company was in compliance with all covenants under the Equipment Loan Arrangement as of December 31, 2021.

Under the Equipment Loan Arrangement, the Company executed notes on various dates between March 24, 2014, and December 4, 2019 in the aggregate amount of $12.2 million, of which $0.7 million and $0.7 million was repaid in 2021 and 2020, respectively. As of December 31, 2021, the aggregate amount outstanding under the equipment notes was $1.3 million. The weighted average interest rate for these notes for the year ended December 31, 2021, was 3.5% and represented $49 thousand of interest expense. As of December 31, 2021, weighted average interest rate was 3.2%.

On May 1, 2020, the Company entered into a term loan with Bank of America N.A. under the PPP administered by the United States Small Business Administration (“SBA”) under the CARES Act (the “PPP Loan”). The principal amount of the PPP Loan was $2.1 million, which was evidenced by a promissory note with a maturity date of May 4, 2022. The note bore interest on the unpaid balance at the rate of one percent (1%) per annum.

In July 2021, the PPP Loan was 100% forgiven by the SBA. The forgiveness of the PPP Loan was recorded in the Company’s third fiscal quarter of the 2021, by eliminating the PPP Loan from the consolidated balance sheet with corresponding gains in income.

The annual principal repayment requirements for debt obligations as of December 31, 2021, are as follows (in thousands):

2022		664
2023		294
2024		305
Long-term debt from equipment financing		1,263
Less current portion of long-term debt from equipment financing		(664	)
Long-term debt from equipment financing, net of current portion	$	599

- Definition

The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants.

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+ Details

Note 2 - Summary of Significant Accounting Policies - Summary of Stock Compensation Expense by Income Statement Account (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Stock compensation expense	$ 743	$ 563	$ 759
Cost of Sales [Member]
Stock compensation expense	63	50	59
General and Administrative Expense [Member]
Stock compensation expense	503	380	579
Selling and Marketing Expense [Member]
Stock compensation expense	114	74	54
Research and Development Expense [Member]
Stock compensation expense	$ 63	$ 59	$ 67

Note 11 - Debt and Other Financing Arrangements (Tables)

12 Months Ended

Dec. 31, 2021

Notes Tables

Schedule of Long-term Debt Instruments [Table Text Block]

2022		664
2023		294
2024		305
Long-term debt from equipment financing		1,263
Less current portion of long-term debt from equipment financing		(664	)
Long-term debt from equipment financing, net of current portion	$	599

- Definition

Tabular disclosure of long-debt instruments or arrangements, including identification, terms, features, collateral requirements and other information necessary to a fair presentation. These are debt arrangements that originally required repayment more than twelve months after issuance or greater than the normal operating cycle of the entity, if longer.

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+ Details

Note 5 - Income Taxes - Components of Net Deferred Tax Liabilities (Details) - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020
Deferred Tax Assets
Allowance for doubtful accounts	$ 21	$ 9
Accrued expenses	129	112
Stock-based compensation	325	265
R&D tax credits	1,083	1,005
Operating lease	944	1,130
PPP Loan expenses	0	9
NOL carryforward	219	97
Gross Deferred Tax Assets	2,721	2,627
Valuation Allowance	(414)	0
Deferred Tax Assets After Valuation Allowance	2,307	2,627
Deferred Tax Liabilities
Excess of tax over book depreciation and amortization	(1,249)	(1,775)
Prepaid expenses	(61)	(48)
Operating lease	(837)	(1,015)
Gross Deferred Tax Liabilities	(2,147)	(2,838)
Net Deferred Tax Assets/(Liabilities)	$ 160
Net Deferred Tax Assets/(Liabilities)		$ (211)

Note 2 - Summary of Significant Accounting Policies (Details Textual) shares in Thousands, $ in Thousands	12 Months Ended
	Dec. 31, 2021 USD ($) shares	Dec. 31, 2020 USD ($) shares	Dec. 31, 2019 USD ($) shares
Cash Equivalents, at Carrying Value, Total	$ 0	$ 0
Depreciation, Depletion and Amortization, Nonproduction, Total	2,700	2,600	$ 2,900
Property, Plant and Equipment, Net, Ending Balance	$ 6,691	$ 9,231
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount (in shares) \| shares	545	588	357
Equipment Loan Arrangement [Member]
Debt Instrument, Interest Rate, Stated Percentage	3.79%
Equipment Loan Arrangement [Member] \| London Interbank Offered Rate (LIBOR) [Member]
Debt Instrument, Basis Spread on Variable Rate	1.75%
Customer Concentration Risk [Member] \| Revenue Benchmark [Member]
Number of Major Customers	0	0	1
Customer Concentration Risk [Member] \| Revenue Benchmark [Member] \| Customer One [Member]
Concentration Risk, Percentage			26.00%
Customer Concentration Risk [Member] \| Accounts Receivable [Member]
Number of Major Customers	0	0
Patents [Member]
Amortization, Total	$ 62	$ 62	$ 40
Finite-Lived Intangible Asset, Useful Life (Year)	20 years
Legal Cost Capitalized, Net	$ 1,100	700	700
Legal Cost Capitalized	400		1,000
Legal Cost Capitalized, Amortization			300
Maximum [Member] \| Patents [Member]
Finite-Lived Intangible Asset, Expected Amortization, Year One	100
Capitalized Software and Equipment [Member]
Property, Plant and Equipment, Net, Ending Balance	500
Software Development [Member]
Software Development Cost Capitalized	99	213
Amortization, Total	$ 421	$ 293	$ 457
Software Development [Member] \| Minimum [Member]
Property, Plant and Equipment, Useful Life (Year)	3 years
Software Development [Member] \| Maximum [Member]
Property, Plant and Equipment, Useful Life (Year)	5 years

Note 5 - Income Taxes (Details Textual) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020
Domestic Tax Authority [Member] \| Internal Revenue Service (IRS) [Member]
Operating Loss Carryforwards, Total	$ 0.3
Tax Credit Carryforward, Amount	0.1
State and Local Jurisdiction [Member]
Operating Loss Carryforwards, Total	2.6
Operating Loss Carryforwards, Subject to Expiration	2.4
Operating Loss Carryforwards, Not Subject to Expiration	0.2
State and Local Jurisdiction [Member] \| California Franchise Tax Board [Member]
Tax Credit Carryforward, Amount	$ 1.2
Effective Income Tax Rate Reconciliation, Tax Credit, Research, Percent	10.40%	9.40%

Note 2 - Summary of Significant Accounting Policies

12 Months Ended

Dec. 31, 2021

Notes to Financial Statements

Significant Accounting Policies [Text Block]

2. Summary of Significant Accounting Policies

Risks and Uncertainties

The Company is subject to a number of risks and uncertainties similar to those of other companies, such as those associated with the continued expansion of the Company’s sales and marketing network, technological developments, intellectual property protection, development of markets for new products and services offered by the Company, the economic health of principal customers of the Company, financial and operational risks associated with expansion of testing facilities used by the Company, government regulation (including, but not limited to, FDA regulations, proposed laws and regulations, and delays in implementation of laws and regulations), competition and general economic conditions.

Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the U.S. requires management to make estimates, including those related to bad debts, long-lived asset lives, income tax valuation and share based compensation, and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Changes in estimates are recorded in the period in which they become known.

Cash and Cash Equivalents

The Company considers all highly liquid investments with original maturities at the date of purchase of 90 days or less as cash equivalents. As of December 31, 2021 and 2020, there were no investments classified as cash equivalents.

Property and Equipment

Property & equipment are recorded at cost. Depreciation and amortization is computed over the estimated useful lives of the assets, using the straight-line method. Repair and maintenance costs are expensed as incurred. The estimated useful lives of the assets are:

Computer software (years)
3 to
5

Office furniture and equipment (years)
3 to
7

Laboratory equipment (years)
5 to
7

Leasehold improvements

Lesser of estimated useful life or lease term

The Company recorded depreciation and amortization related to property and equipment and capitalized software of $2.7 million, $2.6 million, and $2.9 million in 2021, 2020 and 2019, respectively. The Company had $0.5 million of capitalized software and equipment that was not placed in service as of December 31, 2021, which is included as a component of computer software on the accompanying consolidated balance sheets.

Capitalized Software Development Costs

We capitalize costs related to significant software projects developed or obtained for internal use, including costs incurred in a cloud computing arrangement. Costs incurred during the preliminary project work stage or conceptual stage, such as determining the performance requirements, system requirements and data conversion, are expensed as incurred. Costs incurred in the application development phase, such as coding, testing for new software and upgrades that result in additional functionality, are capitalized and are amortized using the straight-line method over the useful life of the software for three to five years. Costs incurred during the post-implementation/operation stage, including training costs and maintenance costs, are expensed as incurred. In accordance with Company policy, during the years ended December 31, 2021, and 2020, we capitalized internally developed software costs of $99 thousand and $213 thousand, respectively. Amortization expense related to software development costs was $421 thousand, $293 thousand and $457 thousand in 2021, 2020 and 2019, respectively. Determining whether particular costs incurred are more properly attributable to the preliminary or conceptual stage, and thus expensed, or to the application development phase, and thus capitalized and amortized, depends on subjective judgments about the nature of the development work, and our judgments in this regard may differ from those made by other companies. General and administrative costs related to developing or obtaining such software is expensed as incurred.

Other Assets

Other assets primarily consist of capitalized legal costs relating to patent applications. The Company amortizes these costs over the lesser of the legal life or estimated useful life of the patent from the date of grant of the applicable patent. The typical life is twenty years. As of December 31, 2021, the Company had capitalized legal costs relating to patent applications of $1.1 million with accumulated amortization of $0.4 million, for a net balance of $0.7 million. As of December 31, 2020, the Company had capitalized legal costs relating to patent applications of $1.0 million with accumulated amortization of $0.3 million, for a net balance of $0.7 million. Amortization expense was $62 thousand, $62 thousand, and $40 thousand in 2021, 2020 and 2019, respectively. The amount of amortization related to patent applications is expected to remain below $100 thousand per year for the next five years.

Revenue Recognition

The Company is in the business of performing drug testing services and reporting the results thereof. The Company’s services are primarily drug and alcohol testing for its customers for an agreed-upon fee per unit tested. The revenues are recognized when the drug test is performed and reported to the customer.

Revenue is recognized when control of the services is transferred to our customers, in an amount that reflects the consideration (none of which is variable) the Company expects to be entitled to in exchange for those services. The Company typically invoices customers monthly for services provided and payments are generally due within 30 to 60 days of the invoice date.

The table below disaggregates our external revenue by major source (in thousands). For additional revenue detail relating to geographic breakdown of sales, see Note 13 – “Business Segment Reporting”.

Year Ended December 31,

2021

2020

2019

Consolidated Revenue:

Testing
$ 21,894 $ 19,068 $ 34,555

Shipping / Collection (hair)
2,847 2,174 2,876

Other
168 118 247

Total Revenue
$ 24,909 $ 21,360 $ 37,678

Testing Revenue

Drug and alcohol tests for drugs of abuse using hair, performed in the Company’s forensic laboratory in California, represents our primary service. Sales to customers are initiated through sales agreements, most of which have standard terms. Most tests are identified through a chain of custody form (“CCF”) and can therefore be uniquely tracked. Revenue is recognized when performance obligations under the terms of the contract with a customer are satisfied; generally, this occurs with the transfer of control of our service, which occurs at a specific point-in-time. The specific point-in-time is the completion of the test and availability of test results to the customer. Most tests are completed the same day that the hair specimen is received.

Substantially all tests are completed within a few days once received for processing at our laboratory in California. As the tests are performed in a forensic laboratory, the exact date and time of each test completion is available and used in the timing of recognition of revenue.

Revenue is measured as the amount of consideration the Company expects to receive in exchange for providing services. Sales taxes the Company pays concurrent with revenue-producing activities are excluded from revenue.

Shipping and Hair Collection Revenue

Shipping revenue represents the amount billed to customers related to shipping of the hair specimen and CCF (collectively called the “sample”) to the Company’s laboratory. Collection revenue represents the amount billed to customers related to the collection of the hair specimen. This collection is done by third parties who have contracted with the Company. Shipping and hair collection revenue is recognized when performance obligations under the terms of the contract with a customer are satisfied; generally, this occurs with the transfer of control of the Company’s service, which occurs at a specific point-in-time. The specific point-in-time is the completion of the test (associated with the shipping or hair collection charge) and availability of test results to the customer.

Revenue is measured as the amount of consideration the Company expects to receive in exchange for providing services. As the Company controls the service before transferring to the customer, it is considered a principal in the transaction, and therefore records revenues on gross basis, with shipping and hair collection costs in costs of revenues.

Other Revenue

Other revenue represents several items including: urine testing performed by other labs, medical review officer charges, legal/testifying services, and other miscellaneous charges. The total of all these items is less than 1% of total revenue. The amounts are generally billed to customers as services are performed, which occurs at a specific point-in-time.

Practical Expedients and Exemptions

The Company generally expenses sales commissions when incurred as they are typically not related to costs to fulfill customer contracts but relate to overall sales targets. These costs are recorded within marketing and selling expense on the accompanying consolidated statements of operations.

Research and Development Expenses

The Company expenses all research and development costs as incurred.

Contingencies

Loss contingencies from legal proceedings and claims may occur from government investigations, shareholder lawsuits, product liability, contractual claims, tax and other matters. Accruals are recognized when it is probable that a liability will be incurred, and the amount of loss can be reasonably estimated. Legal fees are expensed as incurred.

Income Taxes

The Company accounts for income taxes using the liability method pursuant to ASC 740, “Income Taxes”. Under this method, the Company recognizes deferred tax assets and liabilities for the expected tax consequences of temporary differences between the tax bases of assets and liabilities and their reported amounts using enacted tax rates in effect for the year the differences are expected to reverse. The Company evaluates uncertain tax positions annually and considers whether the amounts recorded for income taxes are adequate to address the Company’s tax risk profile. The Company analyzes the potential tax liabilities of specific transactions and tax positions based on management’s judgment as to the expected outcome.

Concentration of Credit Risk and Off-Balance Sheet Risk

The Company has no significant off-balance-sheet risk such as foreign exchange contracts, option contracts, or other foreign hedging arrangements. Financial instruments that potentially subject the Company to concentrations of credit risk are principally cash and accounts receivable. The Company’s policy is to place its cash in high quality financial institutions. At time, these deposits may exceed or be exempt from federally insured limits. The Company does not believe significant credit risk exists with respect to these institutions. Concentration of credit risk with respect to accounts receivable is limited to certain customers to whom the Company makes substantial sales. To reduce risk, the Company routinely assesses the financial strength of its customers and, as a consequence, believes that its accounts receivable credit risk exposure is limited. The Company maintains an allowance for potential credit losses but historically has not experienced any significant losses related to individual customers or groups of customers in any particular industry or geographic area. The Company does not require collateral.

Significant Customers and Concentration of Credit Risk

The Company had no customers that represented 10% or more of total revenue for the years ended December 31, 2021, and 2020, respectively. The Company had one customer that represented 26% of total revenue for the year ended December 31, 2019. The Company had no customers account for 10% or more of the total accounts receivable balance as of December 31, 2021, and 2020, respectively.

Stock-Based Compensation

The Company accounts for equity awards in accordance with ASC 718, “Compensation — Stock Compensation” (“ASC 718”). ASC 718 requires employee equity awards to be accounted for under the fair value method. It also requires the measurement of compensation cost at fair value on the date of grant and recognition of compensation expense over the service period for awards expected to vest. Accordingly, share-based compensation is measured at the grant date based on the fair value of the award. The Company uses the straight-line method to recognize share-based compensation over the service period of the award, which is generally equal to the vesting period. The Company uses the simplified approach to calculate the expected exercise date of options, which is one of the components used to determine the fair value of the options. This approach is used due to the small number of recipients receiving stock options not providing a reasonable basis for estimating expected term. In 2016, the Company adopted ASU 2016-09, Improvements to Employee Share-Based Payment Accounting, which simplifies several aspects of the accounting for employee share-based payment transactions including the accounting for income taxes, forfeitures, and statutory tax withholding requirements, as well as classification of related amounts within the statement of cash flows. As a result, we recognize the impact of forfeitures when they occur with no adjustment for estimated forfeitures and recognize excess tax benefits as a reduction of income tax expense regardless of whether the benefit reduces income taxes payable.

Stock compensation expense by income statement account is as follows (in thousands):

Year Ended December 31,

2021

2020

2019

Cost of revenues
$ 63 $ 50 $ 59

General & administrative
503 380 579

Marketing & selling
114 74 54

Research & development
63 59 67

Total stock compensation
$ 743 $ 563 $ 759

See Note 7 – “Stock-Based Awards” for additional information relating to the Company’s stock plan.

Basic and Diluted Net Income (Loss) per Share

Basic net income (loss) per share is computed by dividing net income (loss) available to common shareholders by the weighted average number of common shares outstanding during the period. Diluted net income per share is computed by dividing net income (loss) available to common shareholders by the weighted average number of common shares and dilutive common stock equivalents outstanding during the period. The number of dilutive common stock equivalents outstanding during the period has been determined in accordance with the treasury-stock method. Common equivalent shares consist of common stock issuable upon the exercise of outstanding options and the unvested portion of stock unit awards (“SUAs”).

Basic and diluted weighted average common shares outstanding are as follows (in thousands):

2021

2020

2019

Weighted average common shares outstanding, basic
5,549 5,524 5,514

Dilutive common equivalent shares
- - 11

Weighted average common shares outstanding, assuming dilution
5,549 5,524 5,525

For the years ended December 31, 2021, 2020 and 2019, options to purchase 545 thousand, 588 thousand and 357 thousand common shares were outstanding but not included in the dilutive common equivalent share calculation as their effect would have been anti-dilutive.

Financial Instruments

Financial instruments include cash, accounts receivable and accounts payable. Estimated fair values of these financial instruments approximate carrying values due to their short-term nature. The Company has two outstanding equipment loans. One had an interest rate of the 30-day LIBOR rate + 1.75% and the other has a fixed interest rate of 3.79%. As there is a market interest rate, the carrying amount is fair value.

Basis of Preparation and Consolidation

The consolidated financial statements include the financial statements of the Company and its wholly-owned subsidiaries have been prepared using accounting principles generally accepted in the United States (“U.S. GAAP”). All intercompany transactions and balances have been eliminated.

Foreign Currency Translation

To the extent sales are made through our Brazil subsidiary, such sales are transacted in Brazilian Real and translated into US dollars. Foreign currency denominated assets and liabilities are translated into U.S. dollars using the exchange rates in effect at the consolidated balance sheet date. Results of operations and cash flows are translated using the average exchange rates throughout the period. The effect of exchange rate fluctuations on translation of assets and liabilities that are in the functional currency is included as a component of shareholders’ equity in accumulated other comprehensive income (loss). The total change in foreign currency translation adjustment for the year ended December 31, 2021, and 2020, respectively was an immaterial amount.

Segment Reporting

The Company manages its operations as one segment, drug testing services. As a result, the financial information disclosed herein materially represents all of the financial information related to the Company’s principal operating segment. See Note 13 – “Business Segment Reporting” for geographic breakdown of revenue.

Recently Adopted Accounting Pronouncements

In December 2019, the FASB issued ASU 2019-12, “Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes”. The amendments in this update simplify the accounting for income taxes by removing certain exceptions to the general principles in ASU Topic 740. The amendments also improve consistent application of and simplify U.S. GAAP for other areas of ASU Topic 740 by clarifying and amending existing guidance. The amendments in this update are effective for interim and annual periods for the Company beginning after December 15, 2020, with early adoption permitted. The Standard may be adopted using the prospective or retrospective transition approach and could be applied to a modified retrospective basis through a cumulative-effect adjustment to retained earnings as of the beginning of the fiscal year adoption. The Company adopted ASU 2019-12 as of January 1, 2021, with no material impact to the Company’s consolidated financial statements.