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critical accounting policies and estimates our discussion and analysis of our financial condition and results of operations are based upon our consolidated financial statements , which have been prepared in accordance with accounting principles generally accepted in the united states . the preparation of these consolidated financial statements requires us to make estimates and judgments that affect the reported amounts of assets , liabilities , revenues and expenses , and related disclosure of contingent assets and liabilities . we continually evaluate our estimates , including those related to bad debts , allowance for obsolete inventory , and the classification of short and long-term inventory , the useful life of property and equipment and land use rights and yew forest assets , recovery of long-lived assets , write-down in value of inventory , and the valuation of equity transactions . we base our estimates on historical experience and on various other assumptions that we believed to be reasonable under the circumstances , the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources . any future changes to these estimates and assumptions could cause a material change to our reported amounts of revenues , expenses , assets and liabilities . actual results may differ from these estimates under different assumptions or conditions . we believe the following critical accounting policies affect our significant judgments and estimates used in the preparation of the financial statements . variable interest entities pursuant to asc 810 and related subtopics related to the consolidation of variable interest entities , we are required to include in our consolidated financial statements the financial statements of vies . the accounting standards require a vie to be consolidated by a company if that company is subject to the risk of loss for the vie or is entitled to receive the vie 's residual returns . vies are those entities in which we , through contractual arrangements , bear the risk of , and enjoy the rewards normally associated with ownership of the entity , and therefore we are the primary beneficiary of the entity . hds is considered a vie , and we are the primary beneficiary . we entered into agreements with hds pursuant to which we shall receive 100 % of hds 's net income . in accordance with these agreements , hds shall pay consulting fees equal to 100 % of its net income to our wholly-owned subsidiary , jsj . jsj shall supply the technology and administrative services needed to service the hds . the accounts of hds are consolidated in the accompanying financial statements . as a vie , hds ' sales are included in our total sales , its income from operations is consolidated with ours , and our net income includes all of hds ' net income , and their assets and liabilities are included in our consolidated balance sheets . the vies do not have any non-controlling interest and , accordingly , we did not subtract any net income in calculating the net income attributable to us . because of the contractual arrangements , we have pecuniary interest in hds that requires consolidation of hds ' financial statements with our financial statements . as required by asc 810-10 , we perform a qualitative assessment to determine whether we are the primary beneficiary of hds which is identified as a vie of us . a quality assessment begins with an understanding of the nature of the risks in the entity as well as the nature of the entity 's activities including terms of the contracts entered into by the entity , ownership interests issued by the entity and the parties involved in the design of the entity . the significant terms of the agreements between us and hds are discussed above in the “ corporate structure and recapitalization - second restructure ” section . our assessment on the involvement with hds reveals that we have the absolute power to direct the most significant activities that impact the economic performance of hds . jsj , our wholly own subsidiary , is obligated to absorb the risk of loss from hds activities and is entitled to receive hds 's expected residual returns . in addition , hds ' shareholders have pledged their equity interest in hds to jsj , irrevocably granted jsj an exclusive option to purchase , to the extent permitted under prc law , all or part of the equity interests in hds and agreed to entrust all the rights to exercise their voting power to the person ( s ) appointed by jsj . under the accounting guidance , we are deemed to be the primary beneficiary of hds and the results of hds ' operation are consolidated in our consolidated financial statements for financial reporting purposes . 28 accordingly , as a vie , hds ' sales are included in our total sales , its income from operations is consolidated with our income from operations and our net income includes all of hds ' net income . all the equity ( net assets ) and profits ( losses ) of hds are attributed to us . therefore , no non-controlling interest in hds is presented in our consolidated financial statements . as we do not have any non-controlling interest and , accordingly , did not subtract any net income in calculating the net income attributable to us . because of the contractual arrangements , ybp has a pecuniary interest in hds that requires consolidation of hds ' financial statements with those of ours . additionally , pursuant to asc 805 , as ybp and hds are under the common control of the hds shareholders , the second restructure was accounted for in a manner similar to a pooling of interests . story_separator_special_tag the standard may be adopted as of any date from the beginning of an interim period that includes or is subsequent to march 12 , 2020 through december 31 , 2022. the company is currently evaluating the effects of the standard on our consolidated financial statements and related disclosures . currency exchange rates our reporting currency is the u.s. dollar , and the functional currency of our operating subsidiaries and vie is the rmb . all of our sales are denominated in rmb . as a result , changes in the relative values of u.s. dollars and rmb affect our reported levels of revenues and profitability as the results of our operations are translated into u.s. dollars for reporting purposes . in particular , fluctuations in currency exchange rates could have a significant impact on our financial stability due to a mismatch among various foreign currency-denominated sales and costs . fluctuations in exchange rates between the u.s. dollar and rmb affect our gross and net profit margins and could result in foreign exchange and operating losses . 31 our exposure to foreign exchange risk primarily relates to currency gains or losses resulting from timing differences between signing of sales contracts and settling of these contracts . furthermore , we translate monetary assets and liabilities denominated in other currencies into rmb , the functional currency of our operating subsidiaries . our results of operations and cash flow are translated at average exchange rates during the period , and assets and liabilities are translated at the unified exchange rate at the end of the period . translation adjustments resulting from this process are included in accumulated other comprehensive income in our statement of shareholders ' equity . we have not used any forward contracts , currency options or borrowings to hedge our exposure to foreign currency exchange risk . we can not predict the impact of future exchange rate fluctuations on our results of operations and may incur net foreign currency losses in the future . our financial statements are expressed in u.s. dollars , which is the functional currency of our parent company . the functional currency of our operating subsidiaries and affiliates is rmb . to the extent we hold assets denominated in u.s. dollars , any appreciation of the rmb against the u.s. dollar could result in a charge in our statement of operations and a reduction in the value of our u.s. dollar denominated assets . on the other hand , a decline in the value of rmb against the u.s. dollar could reduce the u.s. dollar equivalent amounts of our financial results . results of operations the following tables set forth key components of our results of operations for the periods indicated , in dollars . the discussion following the table is based on these results : replace_table_token_1_th 32 year ended december 31 , 2020 compared to year ended december 31 , 2019 revenues for the year ended december 31 , 2020 , we had total revenues of $ 27,307,687 , as compared to $ 27,883,649 for the year ended december 31 , 2019 , a decrease of $ 575,962 or 2.07 % . the decrease in total revenue was attributable to the decrease in revenues from extracts , partially offset by increase in revenues from sales of tcm raw materials . total revenue is summarized as follows : replace_table_token_2_th for the year ended december 31 , 2020 compared to december 31 , 2019 , the increase in revenue of tcm raw material was mainly attributable to the increase in demand from our related party , yew pharmaceutical . the decrease in revenue of extracts was mainly attributable to the increase in demand of pine needle extract , complex taxus cuspidate extract , and composite northeast yew extract . cost of revenues for the year ended december 31 , 2020 , cost of revenues amounted to $ 23,780,672 as compared to $ 27,109,518 for the year ended december 31 , 2019 , a decrease of $ 3,328,846 or 12.28 % . for the year ended december 31 , 2020 , cost of revenues accounted for 87.08 % of total revenues compared to 97.22 % of total revenues for the year ended december 31 , 2019. cost of revenues by product categories is as follows : replace_table_token_3_th the decrease in our cost of revenues for the year ended december 31 , 2020 as compared to the year ended december 31 , 2019 was primarily a result of the decrease in costs of revenue in extracts , partially offset by increases in tcm raw materials . 33 gross profit for the year ended december 31 , 2020 , gross profit was $ 3,527,015 as compared to $ 774,131 for the year ended december 31 , 2019 , representing gross profit margins of 12.92 % and 2.78 % , respectively . gross profit margins by categories are as follows : replace_table_token_4_th the increase in our overall gross profit margin for the year ended december 31 , 2020 as compared to the year ended december 31 , 2019 was primarily attributable to the higher gross margin yields of tcm raw materials and extracts . the increase in our gross margin percentage related to the sale of tcm raw materials for the year ended december 31 , 2020 as compared to the year ended december 31 , 2019 , was primarily attributable to the fact that conversion rate from yew tree into yew foliage for the year ended december 31 , 2020 was higher than it for the year ended december 31 , 2019. operating expenses for the year ended december 31 , 2020 , operating expenses amounted to $ 958,316 , as compared to $ ( 237,388 ) for the year ended december 31 , 2019 , an increase of $ 1,195,704 or 503.69 % . the increase was mainly due to the fact that the company had $ 30,658 bad debt recovery as of december 31 , 2020 compared with

liquidity and capital resources liquidity is the ability of a company to generate funds to support its current and future operations , satisfy its obligations and otherwise operate on an ongoing basis . at december 31 , 2020 and 2019 , we had cash balances of $ 563,792 and $ 742,294 , respectively . these funds were primarily located in various financial institutions located in china . our primary uses of cash have been for the purchase of yew trees , land use rights and yew forest assets . additionally , we use cash for employee compensation and working capital . our working capital decreased by $ 1,725,779 to $ ( 535,726 ) at december 31 , 2020 , from working capital of $ 1,190,053 at december 31 , 2019 . 35 for the year ended december 31 , 2020 , net cash flow provided by operating activities was $ 17,340,086 , as compared to $ 11,953,657 for the year ended december 31 , 2019 , an increase of $ 5,386,429. because the exchange rate conversion is different for the balance sheet and the statements of cash flows , the changes in assets and liabilities reflected on the statements of cash flows are not necessarily identical with the comparable changes reflected on the balance sheets .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```liquidity and capital resources liquidity is the ability of a company to generate funds to support its current and future operations , satisfy its obligations and otherwise operate on an ongoing basis . at december 31 , 2020 and 2019 , we had cash balances of $ 563,792 and $ 742,294 , respectively . these funds were primarily located in various financial institutions located in china . our primary uses of cash have been for the purchase of yew trees , land use rights and yew forest assets . additionally , we use cash for employee compensation and working capital . our working capital decreased by $ 1,725,779 to $ ( 535,726 ) at december 31 , 2020 , from working capital of $ 1,190,053 at december 31 , 2019 . 35 for the year ended december 31 , 2020 , net cash flow provided by operating activities was $ 17,340,086 , as compared to $ 11,953,657 for the year ended december 31 , 2019 , an increase of $ 5,386,429. because the exchange rate conversion is different for the balance sheet and the statements of cash flows , the changes in assets and liabilities reflected on the statements of cash flows are not necessarily identical with the comparable changes reflected on the balance sheets . ``` Suspicious Activity Report : critical accounting policies and estimates our discussion and analysis of our financial condition and results of operations are based upon our consolidated financial statements , which have been prepared in accordance with accounting principles generally accepted in the united states . the preparation of these consolidated financial statements requires us to make estimates and judgments that affect the reported amounts of assets , liabilities , revenues and expenses , and related disclosure of contingent assets and liabilities . we continually evaluate our estimates , including those related to bad debts , allowance for obsolete inventory , and the classification of short and long-term inventory , the useful life of property and equipment and land use rights and yew forest assets , recovery of long-lived assets , write-down in value of inventory , and the valuation of equity transactions . we base our estimates on historical experience and on various other assumptions that we believed to be reasonable under the circumstances , the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources . any future changes to these estimates and assumptions could cause a material change to our reported amounts of revenues , expenses , assets and liabilities . actual results may differ from these estimates under different assumptions or conditions . we believe the following critical accounting policies affect our significant judgments and estimates used in the preparation of the financial statements . variable interest entities pursuant to asc 810 and related subtopics related to the consolidation of variable interest entities , we are required to include in our consolidated financial statements the financial statements of vies . the accounting standards require a vie to be consolidated by a company if that company is subject to the risk of loss for the vie or is entitled to receive the vie 's residual returns . vies are those entities in which we , through contractual arrangements , bear the risk of , and enjoy the rewards normally associated with ownership of the entity , and therefore we are the primary beneficiary of the entity . hds is considered a vie , and we are the primary beneficiary . we entered into agreements with hds pursuant to which we shall receive 100 % of hds 's net income . in accordance with these agreements , hds shall pay consulting fees equal to 100 % of its net income to our wholly-owned subsidiary , jsj . jsj shall supply the technology and administrative services needed to service the hds . the accounts of hds are consolidated in the accompanying financial statements . as a vie , hds ' sales are included in our total sales , its income from operations is consolidated with ours , and our net income includes all of hds ' net income , and their assets and liabilities are included in our consolidated balance sheets . the vies do not have any non-controlling interest and , accordingly , we did not subtract any net income in calculating the net income attributable to us . because of the contractual arrangements , we have pecuniary interest in hds that requires consolidation of hds ' financial statements with our financial statements . as required by asc 810-10 , we perform a qualitative assessment to determine whether we are the primary beneficiary of hds which is identified as a vie of us . a quality assessment begins with an understanding of the nature of the risks in the entity as well as the nature of the entity 's activities including terms of the contracts entered into by the entity , ownership interests issued by the entity and the parties involved in the design of the entity . the significant terms of the agreements between us and hds are discussed above in the “ corporate structure and recapitalization - second restructure ” section . our assessment on the involvement with hds reveals that we have the absolute power to direct the most significant activities that impact the economic performance of hds . jsj , our wholly own subsidiary , is obligated to absorb the risk of loss from hds activities and is entitled to receive hds 's expected residual returns . in addition , hds ' shareholders have pledged their equity interest in hds to jsj , irrevocably granted jsj an exclusive option to purchase , to the extent permitted under prc law , all or part of the equity interests in hds and agreed to entrust all the rights to exercise their voting power to the person ( s ) appointed by jsj . under the accounting guidance , we are deemed to be the primary beneficiary of hds and the results of hds ' operation are consolidated in our consolidated financial statements for financial reporting purposes . 28 accordingly , as a vie , hds ' sales are included in our total sales , its income from operations is consolidated with our income from operations and our net income includes all of hds ' net income . all the equity ( net assets ) and profits ( losses ) of hds are attributed to us . therefore , no non-controlling interest in hds is presented in our consolidated financial statements . as we do not have any non-controlling interest and , accordingly , did not subtract any net income in calculating the net income attributable to us . because of the contractual arrangements , ybp has a pecuniary interest in hds that requires consolidation of hds ' financial statements with those of ours . additionally , pursuant to asc 805 , as ybp and hds are under the common control of the hds shareholders , the second restructure was accounted for in a manner similar to a pooling of interests . story_separator_special_tag the standard may be adopted as of any date from the beginning of an interim period that includes or is subsequent to march 12 , 2020 through december 31 , 2022. the company is currently evaluating the effects of the standard on our consolidated financial statements and related disclosures . currency exchange rates our reporting currency is the u.s. dollar , and the functional currency of our operating subsidiaries and vie is the rmb . all of our sales are denominated in rmb . as a result , changes in the relative values of u.s. dollars and rmb affect our reported levels of revenues and profitability as the results of our operations are translated into u.s. dollars for reporting purposes . in particular , fluctuations in currency exchange rates could have a significant impact on our financial stability due to a mismatch among various foreign currency-denominated sales and costs . fluctuations in exchange rates between the u.s. dollar and rmb affect our gross and net profit margins and could result in foreign exchange and operating losses . 31 our exposure to foreign exchange risk primarily relates to currency gains or losses resulting from timing differences between signing of sales contracts and settling of these contracts . furthermore , we translate monetary assets and liabilities denominated in other currencies into rmb , the functional currency of our operating subsidiaries . our results of operations and cash flow are translated at average exchange rates during the period , and assets and liabilities are translated at the unified exchange rate at the end of the period . translation adjustments resulting from this process are included in accumulated other comprehensive income in our statement of shareholders ' equity . we have not used any forward contracts , currency options or borrowings to hedge our exposure to foreign currency exchange risk . we can not predict the impact of future exchange rate fluctuations on our results of operations and may incur net foreign currency losses in the future . our financial statements are expressed in u.s. dollars , which is the functional currency of our parent company . the functional currency of our operating subsidiaries and affiliates is rmb . to the extent we hold assets denominated in u.s. dollars , any appreciation of the rmb against the u.s. dollar could result in a charge in our statement of operations and a reduction in the value of our u.s. dollar denominated assets . on the other hand , a decline in the value of rmb against the u.s. dollar could reduce the u.s. dollar equivalent amounts of our financial results . results of operations the following tables set forth key components of our results of operations for the periods indicated , in dollars . the discussion following the table is based on these results : replace_table_token_1_th 32 year ended december 31 , 2020 compared to year ended december 31 , 2019 revenues for the year ended december 31 , 2020 , we had total revenues of $ 27,307,687 , as compared to $ 27,883,649 for the year ended december 31 , 2019 , a decrease of $ 575,962 or 2.07 % . the decrease in total revenue was attributable to the decrease in revenues from extracts , partially offset by increase in revenues from sales of tcm raw materials . total revenue is summarized as follows : replace_table_token_2_th for the year ended december 31 , 2020 compared to december 31 , 2019 , the increase in revenue of tcm raw material was mainly attributable to the increase in demand from our related party , yew pharmaceutical . the decrease in revenue of extracts was mainly attributable to the increase in demand of pine needle extract , complex taxus cuspidate extract , and composite northeast yew extract . cost of revenues for the year ended december 31 , 2020 , cost of revenues amounted to $ 23,780,672 as compared to $ 27,109,518 for the year ended december 31 , 2019 , a decrease of $ 3,328,846 or 12.28 % . for the year ended december 31 , 2020 , cost of revenues accounted for 87.08 % of total revenues compared to 97.22 % of total revenues for the year ended december 31 , 2019. cost of revenues by product categories is as follows : replace_table_token_3_th the decrease in our cost of revenues for the year ended december 31 , 2020 as compared to the year ended december 31 , 2019 was primarily a result of the decrease in costs of revenue in extracts , partially offset by increases in tcm raw materials . 33 gross profit for the year ended december 31 , 2020 , gross profit was $ 3,527,015 as compared to $ 774,131 for the year ended december 31 , 2019 , representing gross profit margins of 12.92 % and 2.78 % , respectively . gross profit margins by categories are as follows : replace_table_token_4_th the increase in our overall gross profit margin for the year ended december 31 , 2020 as compared to the year ended december 31 , 2019 was primarily attributable to the higher gross margin yields of tcm raw materials and extracts . the increase in our gross margin percentage related to the sale of tcm raw materials for the year ended december 31 , 2020 as compared to the year ended december 31 , 2019 , was primarily attributable to the fact that conversion rate from yew tree into yew foliage for the year ended december 31 , 2020 was higher than it for the year ended december 31 , 2019. operating expenses for the year ended december 31 , 2020 , operating expenses amounted to $ 958,316 , as compared to $ ( 237,388 ) for the year ended december 31 , 2019 , an increase of $ 1,195,704 or 503.69 % . the increase was mainly due to the fact that the company had $ 30,658 bad debt recovery as of december 31 , 2020 compared with

most traditional wireline and wireless telephone service providers and cable companies are substantially larger and better capitalized than we are and have the advantage of a large existing customer base . in addition , because our competitors provide other services , they often choose to offer voip services or other voice services as part of a bundle that includes other products , such as video , high speed internet access , and wireless telephone service , which we do not offer . we also compete against alternative communication providers . some of these service providers have chosen to sacrifice telephony revenue in order to gain market share and have offered their services at low prices or for free . as we continue to introduce applications that integrate different forms of voice and messaging services over multiple devices , we are facing competition from emerging competitors focused on similar integration , as well as from alternative voice communication providers . we also are subject to the risk of future disruptive technologies . in connection with our emphasis on the international long distance market in the united states , we face competition from low-cost international calling cards and voip providers in addition to traditional telephone companies , cable companies , and wireless companies , each of which may implement promotional pricing targeting international long distance callers . regulation . our business has developed in a relatively lightly regulated environment . for further discussion regarding regulatory issues which impacts the company , refer to `` regulation `` in note 11 , commitments and contingencies to our financial statements . key operating data the table below includes key operating data that our management uses to measure the growth and operating performance of the business segment : replace_table_token_4_th service revenues per customer . service revenues per customer for a particular period is calculated by dividing the average monthly service revenues for the period by the average number of customers over the number of months in the period . the average number of customers is the number of customers on the first day of the period , plus the number of customers on the last day of the period , divided by two . service revenues excludes revenues from trading and auction customers . service revenues per customer increased from $ 327 for 2017 to $ 358 for 2018 primarily driven by the company 's successful efforts to attract larger business customers and to expand services provided to our existing business customers . business revenue churn . business revenue churn is calculated by dividing the revenue from customers or customer locations that have been confirmed to be foregone during a period by the simple average of the total revenue from all customers in that period . revenue for purposes of determining business revenue churn is service revenue excluding revenue from our trading and auction customers , and usage in excess of a customer 's contracted service plan , regulatory fees charged to customers , and credits . the simple average of total revenue from all customers during the period is the total revenue as defined herein on the first day of the period , plus the total revenue as defined herein on the last day of the period , divided by two . terminations , as used in the calculation of churn statistics , do not include customers terminated during the period if termination occurred within the first month after activation . other companies may calculate business revenue churn differently , and their business revenue churn data may not be directly comparable to ours . business revenue churn decreased slightly from 1.2 % in 2017 to 1.1 % in 2018 . our revenue churn will fluctuate over time due to economic conditions , seasonality in certain customer 's operations , loss of customers who are acquired , and competitive pressures including promotional pricing . we are continuing to invest in our overall quality of service which includes customer care headcount and systems , billing systems , on-boarding processes and self-service options to ensure we scale our processes to our growth and continue to improve the overall customer experience . the table below includes key operating data that our management uses to measure the growth and operating performance of the consumer segment : replace_table_token_5_th 29 vonage annual report 2018 average monthly revenues per subscriber line . average monthly revenues per subscriber line for a particular period is calculated by dividing our revenues for that period by the simple average number of subscriber lines for the period , and dividing the result by the number of months in the period . the simple average number of subscriber lines for the period is the number of subscriber lines on the first day of the period , plus the number of subscriber lines on the last day of the period , divided by two . our average monthly revenues per subscriber line increased from $ 26.19 for 2017 to $ 26.42 for 2018 due primarily to the company 's ability to retain its more tenured customers . subscriber lines . our subscriber lines include , as of a particular date , all paid subscriber lines from which a customer can make an outbound telephone call on that date . our subscriber lines include fax lines , including fax lines bundled with subscriber lines in our small office home office calling plans and soft phones , but do not include our virtual phone numbers and toll free numbers , which only allow inbound telephone calls to customers . subscriber lines decreased from 1,492,067 as of december 31 , 2017 to 1,287,649 as of december 31 , 2018 , reflecting planned actions to enhance the profitability of the assisted sales channel by eliminating lower performing locations and restructuring the pricing offers , and to shift investment to our business market . customer churn . story_separator_special_tag for the year ended december 31 , 2017 compared to the year ended december 31 , 2016 total other operating expenses decreased $ 18,376 during the year ended december 31 , 2017 as compared to the year ended december 31 , 2016 primarily due to the following : sales and marketing expense decreased by $ 17,718 , or 5 % , due to a continued shift during 2017 in traditional marketing investments targeting consumer customers to more selective targeted advertising focused on attracting more profitable business customers resulting in overall fewer media marketing programs being deployed during the current year . other income ( expense ) replace_table_token_11_th for the year ended december 31 , 2018 compared to the year ended december 31 , 2017 interest expense . the increase in interest expense of $ 200 , or 1 % , was mainly due to higher principal balances on our 2018 credit facility that we entered into in july 2018 and our 2016 credit facility that we entered into in july 2016 as compared to the prior year on our 2016 credit facility along with rising rates during the second half of 2018. other income ( expense ) , net . other income ( expense ) , net decreased by $ 1,588 , or 125 % in 2018 compared to 2017 due to the gain from the sale of the hosted infrastructure product line during the year ended december 31 , 2017. for the year ended december 31 , 2017 compared to the year ended december 31 , 2016 interest expense . the increase in interest expense of $ 1,826 , or 14 % , was due mainly to higher interest rates in 2017 compared to 2016 , partially offset by lower principal balances , and the additional interest expense associated with our interest rate swaps arrangement . other income ( expense ) , net . other income ( expense ) , net increased by $ 1,537 , or 576 % in 2017 compared to 2016 due the sale of the hosted infrastructure product line during the second quarter of 2017 as further discussed in note 12 , acquisitions and dispositions . 37 vonage annual report 2018 income taxes replace_table_token_12_th for the year ended december 31 , 2018 compared to the year ended december 31 , 2017 we recognize income taxes equal to pre-tax income multiplied by our annual effective income tax rate . in addition , adjustments are recorded for discrete period items and changes to our state effective tax rate which can cause the rate to fluctuate from quarter to quarter . during the year ended december 31 , 2018 , we recognized tax expense of $ 797 related to u.s. , state and foreign income tax expense . the company has recorded a permanent benefit related to excess share-based stock compensation . in addition , certain acquisition related expenses incurred during 2018 are treated as a permanent difference as the expenses are not deductible for tax purposes but are a reduction of pre-tax income . the company also recorded a permanent difference related to the impact of the tax cuts and jobs act , or tcja , related to the excess compensation deduction pertaining to covered employees who received compensation in excess of $ 1 million dollars . during the year ended december 31 , 2017 , the company recognized tax expense of $ 79,726 which primarily reflects the impact of the tax cuts and jobs act , or tcja , which was signed into law by the president of the united states on december 22 , 2017. the tcja most notably reduces the corporate tax rate from 35 % to 21 % along with eliminating the alternative minimum tax , or amt , and imposes a mandatory one-time tax on foreign earnings . the company recorded an income tax expense of $ 69,378 which is primarily with the re-measurement of the company 's deferred tax balances at the 21 % income tax rate . the company has concluded that the provisional amount recorded as of december 31 , 2017 is final and does not require any further adjustment . during the year ended december 31 , 2016 , the company recognized tax expense of $ 17,694 which is primarily related to the contingent consideration in connection with the acquisition of nexmo which was treated as a permanent difference as the expense is not deductible for tax purposes but is a reduction of pre-tax income . 38 vonage annual report 2018 liquidity and capital resources overview during the years ended december 31 , 2018 , 2017 , and 2016 we generated cash from operations . we expect to continue to balance efforts to grow our revenue while consistently achieving operating profitability . to grow our revenue , we continue to make investments in growth initiatives , marketing , application development , network quality and expansion , and customer care . although we believe we will achieve consistent profitability in the future , we ultimately may not be successful and we may not achieve consistent profitability . we believe that cash flow from operations and cash on hand will fund our operations for at least the next twelve months . the following table sets forth a summary of our cash flows for the periods indicated : replace_table_token_13_th operating activities story_separator_special_tag ended december 31 , 2018. nexmo was acquired on june 3 , 2016. nexmo shareholders received consideration of $ 231,122. of the consideration , $ 194,684 ( net of cash acquired of $ 16,094 ) was paid at close , which consisted of $ 163,093 of cash ( net of $ 16,094 of cash acquired ) and 6,823 in shares of vonage common stock valued at $ 31,591. the remaining $ 36,438 of the $ 231,122 purchase price was in the form of restricted cash , restricted stock and options held by nexmo management and employees , subject to vesting requirements over time . state and local sales taxes

cash provided by operating activities decreased to $ 123,205 for the year ended december 31 , 2018 compared to $ 128,058 for the year ended december 31 , 2017 , primarily due to a decrease of $ 73,071 in non-cash items offset by an increase in net income . also attributing to the decrease in operating activities was an increase in cash used for working capital requirements of $ 1,443 during the year ended december 31 , 2018 as compared to the year ended december 31 , 2017 primarily due payment of acquisition related expenses made during the current year . cash provided by operating activities increased to $ 128,058 for the year ended december 31 , 2017 as compared to $ 93,456 for the year ended december 31 , 2016 primarily due to an increase in operating income adjusted for non-cash items of $ 27,817 driven by a decrease in operating expenses as compared to the year ended december 31 , 2016 primarily attributable to decreased sales and marketing costs . also attributing to the increase in operating activities was a decrease in cash used for working capital requirements of $ 6,785 during the year ended december 31 , 2017 as compared to the year ended december 31 , 2016 primarily due to a decrease in timing of prepayments made during the current year .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```cash provided by operating activities decreased to $ 123,205 for the year ended december 31 , 2018 compared to $ 128,058 for the year ended december 31 , 2017 , primarily due to a decrease of $ 73,071 in non-cash items offset by an increase in net income . also attributing to the decrease in operating activities was an increase in cash used for working capital requirements of $ 1,443 during the year ended december 31 , 2018 as compared to the year ended december 31 , 2017 primarily due payment of acquisition related expenses made during the current year . cash provided by operating activities increased to $ 128,058 for the year ended december 31 , 2017 as compared to $ 93,456 for the year ended december 31 , 2016 primarily due to an increase in operating income adjusted for non-cash items of $ 27,817 driven by a decrease in operating expenses as compared to the year ended december 31 , 2016 primarily attributable to decreased sales and marketing costs . also attributing to the increase in operating activities was a decrease in cash used for working capital requirements of $ 6,785 during the year ended december 31 , 2017 as compared to the year ended december 31 , 2016 primarily due to a decrease in timing of prepayments made during the current year . ``` Suspicious Activity Report : most traditional wireline and wireless telephone service providers and cable companies are substantially larger and better capitalized than we are and have the advantage of a large existing customer base . in addition , because our competitors provide other services , they often choose to offer voip services or other voice services as part of a bundle that includes other products , such as video , high speed internet access , and wireless telephone service , which we do not offer . we also compete against alternative communication providers . some of these service providers have chosen to sacrifice telephony revenue in order to gain market share and have offered their services at low prices or for free . as we continue to introduce applications that integrate different forms of voice and messaging services over multiple devices , we are facing competition from emerging competitors focused on similar integration , as well as from alternative voice communication providers . we also are subject to the risk of future disruptive technologies . in connection with our emphasis on the international long distance market in the united states , we face competition from low-cost international calling cards and voip providers in addition to traditional telephone companies , cable companies , and wireless companies , each of which may implement promotional pricing targeting international long distance callers . regulation . our business has developed in a relatively lightly regulated environment . for further discussion regarding regulatory issues which impacts the company , refer to `` regulation `` in note 11 , commitments and contingencies to our financial statements . key operating data the table below includes key operating data that our management uses to measure the growth and operating performance of the business segment : replace_table_token_4_th service revenues per customer . service revenues per customer for a particular period is calculated by dividing the average monthly service revenues for the period by the average number of customers over the number of months in the period . the average number of customers is the number of customers on the first day of the period , plus the number of customers on the last day of the period , divided by two . service revenues excludes revenues from trading and auction customers . service revenues per customer increased from $ 327 for 2017 to $ 358 for 2018 primarily driven by the company 's successful efforts to attract larger business customers and to expand services provided to our existing business customers . business revenue churn . business revenue churn is calculated by dividing the revenue from customers or customer locations that have been confirmed to be foregone during a period by the simple average of the total revenue from all customers in that period . revenue for purposes of determining business revenue churn is service revenue excluding revenue from our trading and auction customers , and usage in excess of a customer 's contracted service plan , regulatory fees charged to customers , and credits . the simple average of total revenue from all customers during the period is the total revenue as defined herein on the first day of the period , plus the total revenue as defined herein on the last day of the period , divided by two . terminations , as used in the calculation of churn statistics , do not include customers terminated during the period if termination occurred within the first month after activation . other companies may calculate business revenue churn differently , and their business revenue churn data may not be directly comparable to ours . business revenue churn decreased slightly from 1.2 % in 2017 to 1.1 % in 2018 . our revenue churn will fluctuate over time due to economic conditions , seasonality in certain customer 's operations , loss of customers who are acquired , and competitive pressures including promotional pricing . we are continuing to invest in our overall quality of service which includes customer care headcount and systems , billing systems , on-boarding processes and self-service options to ensure we scale our processes to our growth and continue to improve the overall customer experience . the table below includes key operating data that our management uses to measure the growth and operating performance of the consumer segment : replace_table_token_5_th 29 vonage annual report 2018 average monthly revenues per subscriber line . average monthly revenues per subscriber line for a particular period is calculated by dividing our revenues for that period by the simple average number of subscriber lines for the period , and dividing the result by the number of months in the period . the simple average number of subscriber lines for the period is the number of subscriber lines on the first day of the period , plus the number of subscriber lines on the last day of the period , divided by two . our average monthly revenues per subscriber line increased from $ 26.19 for 2017 to $ 26.42 for 2018 due primarily to the company 's ability to retain its more tenured customers . subscriber lines . our subscriber lines include , as of a particular date , all paid subscriber lines from which a customer can make an outbound telephone call on that date . our subscriber lines include fax lines , including fax lines bundled with subscriber lines in our small office home office calling plans and soft phones , but do not include our virtual phone numbers and toll free numbers , which only allow inbound telephone calls to customers . subscriber lines decreased from 1,492,067 as of december 31 , 2017 to 1,287,649 as of december 31 , 2018 , reflecting planned actions to enhance the profitability of the assisted sales channel by eliminating lower performing locations and restructuring the pricing offers , and to shift investment to our business market . customer churn . story_separator_special_tag for the year ended december 31 , 2017 compared to the year ended december 31 , 2016 total other operating expenses decreased $ 18,376 during the year ended december 31 , 2017 as compared to the year ended december 31 , 2016 primarily due to the following : sales and marketing expense decreased by $ 17,718 , or 5 % , due to a continued shift during 2017 in traditional marketing investments targeting consumer customers to more selective targeted advertising focused on attracting more profitable business customers resulting in overall fewer media marketing programs being deployed during the current year . other income ( expense ) replace_table_token_11_th for the year ended december 31 , 2018 compared to the year ended december 31 , 2017 interest expense . the increase in interest expense of $ 200 , or 1 % , was mainly due to higher principal balances on our 2018 credit facility that we entered into in july 2018 and our 2016 credit facility that we entered into in july 2016 as compared to the prior year on our 2016 credit facility along with rising rates during the second half of 2018. other income ( expense ) , net . other income ( expense ) , net decreased by $ 1,588 , or 125 % in 2018 compared to 2017 due to the gain from the sale of the hosted infrastructure product line during the year ended december 31 , 2017. for the year ended december 31 , 2017 compared to the year ended december 31 , 2016 interest expense . the increase in interest expense of $ 1,826 , or 14 % , was due mainly to higher interest rates in 2017 compared to 2016 , partially offset by lower principal balances , and the additional interest expense associated with our interest rate swaps arrangement . other income ( expense ) , net . other income ( expense ) , net increased by $ 1,537 , or 576 % in 2017 compared to 2016 due the sale of the hosted infrastructure product line during the second quarter of 2017 as further discussed in note 12 , acquisitions and dispositions . 37 vonage annual report 2018 income taxes replace_table_token_12_th for the year ended december 31 , 2018 compared to the year ended december 31 , 2017 we recognize income taxes equal to pre-tax income multiplied by our annual effective income tax rate . in addition , adjustments are recorded for discrete period items and changes to our state effective tax rate which can cause the rate to fluctuate from quarter to quarter . during the year ended december 31 , 2018 , we recognized tax expense of $ 797 related to u.s. , state and foreign income tax expense . the company has recorded a permanent benefit related to excess share-based stock compensation . in addition , certain acquisition related expenses incurred during 2018 are treated as a permanent difference as the expenses are not deductible for tax purposes but are a reduction of pre-tax income . the company also recorded a permanent difference related to the impact of the tax cuts and jobs act , or tcja , related to the excess compensation deduction pertaining to covered employees who received compensation in excess of $ 1 million dollars . during the year ended december 31 , 2017 , the company recognized tax expense of $ 79,726 which primarily reflects the impact of the tax cuts and jobs act , or tcja , which was signed into law by the president of the united states on december 22 , 2017. the tcja most notably reduces the corporate tax rate from 35 % to 21 % along with eliminating the alternative minimum tax , or amt , and imposes a mandatory one-time tax on foreign earnings . the company recorded an income tax expense of $ 69,378 which is primarily with the re-measurement of the company 's deferred tax balances at the 21 % income tax rate . the company has concluded that the provisional amount recorded as of december 31 , 2017 is final and does not require any further adjustment . during the year ended december 31 , 2016 , the company recognized tax expense of $ 17,694 which is primarily related to the contingent consideration in connection with the acquisition of nexmo which was treated as a permanent difference as the expense is not deductible for tax purposes but is a reduction of pre-tax income . 38 vonage annual report 2018 liquidity and capital resources overview during the years ended december 31 , 2018 , 2017 , and 2016 we generated cash from operations . we expect to continue to balance efforts to grow our revenue while consistently achieving operating profitability . to grow our revenue , we continue to make investments in growth initiatives , marketing , application development , network quality and expansion , and customer care . although we believe we will achieve consistent profitability in the future , we ultimately may not be successful and we may not achieve consistent profitability . we believe that cash flow from operations and cash on hand will fund our operations for at least the next twelve months . the following table sets forth a summary of our cash flows for the periods indicated : replace_table_token_13_th operating activities story_separator_special_tag ended december 31 , 2018. nexmo was acquired on june 3 , 2016. nexmo shareholders received consideration of $ 231,122. of the consideration , $ 194,684 ( net of cash acquired of $ 16,094 ) was paid at close , which consisted of $ 163,093 of cash ( net of $ 16,094 of cash acquired ) and 6,823 in shares of vonage common stock valued at $ 31,591. the remaining $ 36,438 of the $ 231,122 purchase price was in the form of restricted cash , restricted stock and options held by nexmo management and employees , subject to vesting requirements over time . state and local sales taxes

we recorded a gain of $ 12.7 million from the sale of dfsc in our results of operations during 2019. we sold the northwest common stock that we received as part of the consideration during 2019. this transaction represented the culmination of a banking strategy that began with the formation of dfsc in 2000. effective december 1 , 2019 , our insurance subsidiaries le mars insurance company ( “ le mars ” ) and sheboygan falls insurance company ( “ sheboygan falls ” ) merged with and into atlantic states ( the “ mergers ” ) . as a result of the mergers , the separate corporate existences of le mars and sheboygan falls ceased and atlantic states continued as the surviving insurance company . atlantic states placed the business of le mars and sheboygan falls , as their policies renewed subsequent to the effective date of the mergers , into the underwriting pool . at december 31 , 2020 , donegal mutual held approximately 42 % of our outstanding class a common stock and approximately 84 % of our outstanding class b common stock . this ownership provides donegal mutual with approximately 71 % of the combined voting power of our outstanding shares of class a common stock and our outstanding shares of class b common stock . -48- donegal mutual and atlantic states have participated in a proportional reinsurance agreement , or pooling agreement , since 1986. under the pooling agreement , donegal mutual and atlantic states contribute substantially all of their respective premiums , losses and loss expenses to the underwriting pool , and the underwriting pool , acting through donegal mutual , then allocates 80 % of the pooled business to atlantic states . thus , donegal mutual and atlantic states share the underwriting results of the pooled business in proportion to their respective participation in the underwriting pool . the operations of our insurance subsidiaries and donegal mutual are interrelated due to the pooling agreement and other factors . while maintaining the separate corporate existence of each company , our insurance subsidiaries conduct business together with donegal mutual and its insurance subsidiaries as the donegal insurance group . the donegal insurance group is not a legal entity , is not an insurance company and does not issue or administer insurance policies . rather , it is a trade name that refers to the group of insurance companies that are affiliated with donegal mutual . see “ business - history and organizational structure ” for more information regarding the pooling agreement and other transactions with our affiliates . in july 2013 , our board of directors authorized a share repurchase program pursuant to which we have the authority to purchase up to 500,000 additional shares of our class a common stock at prices prevailing from time to time in the open market subject to the provisions of the sec rule 10b-18 and in privately negotiated transactions . we did not purchase any shares of our class a common stock under this program during 2020 or 2019. we have purchased a total of 57,658 shares of our class a common stock under this program from its inception through december 31 , 2020. critical accounting policies and estimates we combine our financial statements with those of our insurance subsidiaries and present them on a consolidated basis in accordance with gaap . our insurance subsidiaries make estimates and assumptions that can have a significant effect on amounts and disclosures we report in our financial statements . the most significant estimates relate to the reserves of our insurance subsidiaries for property and casualty insurance unpaid losses and loss expenses . while we believe our estimates and the estimates of our insurance subsidiaries are appropriate , the ultimate amounts may differ from the estimates we provided . we regularly review our methods for making these estimates , and we reflect any adjustment we consider necessary in our results of operations for the period in which we make an adjustment . liability for losses and loss expenses liabilities for losses and loss expenses are estimates at a given point in time of the amounts an insurer expects to pay with respect to incurred policyholder claims based on facts and circumstances the insurer knows at that point in time . for example , legislative , judicial and regulatory actions may expand coverage definitions , retroactively mandate coverage or otherwise require our insurance subsidiaries to pay losses for damages that their policies explicitly excluded or did not intend to cover . at the time of establishing its estimates , an insurer recognizes that its ultimate liability for losses and loss expenses will exceed or be less than such estimates . our insurance subsidiaries base their estimates of liabilities for losses and loss expenses on assumptions as to future loss trends , expected claims severity , judicial theories of liability and other factors . however , during the loss adjustment period , our insurance subsidiaries may learn additional facts regarding individual claims , and , consequently , it often becomes necessary for our insurance subsidiaries to refine and adjust their estimates for these liabilities . we reflect any adjustments to the liabilities for losses and loss expenses of our insurance subsidiaries in our consolidated results of operations in the period in which our insurance subsidiaries make adjustments to their estimates . our insurance subsidiaries maintain liabilities for the payment of losses and loss expenses with respect to both reported and unreported claims . our insurance subsidiaries establish these liabilities for the purpose of covering the ultimate costs of settling all losses , including investigation and litigation costs . our insurance subsidiaries base the amount of their liability for reported losses primarily upon a case-by-case evaluation of the type of risk involved , knowledge of the circumstances -49- surrounding each claim and the insurance policy provisions relating to the type of loss the policyholder incurred . story_separator_special_tag the calculation of our statutory combined ratio differs from the calculation of our gaap combined ratio . in calculating our gaap combined ratio , we do not deduct installment payment fees from incurred expenses , and we base the expense ratio on net premiums earned instead of net premiums written . differences between our gaap loss ratio and our statutory loss ratio result from anticipating salvage and subrogation recoveries for our gaap loss ratio but not for our statutory loss ratio . the following table presents comparative details with respect to our gaap and statutory combined ratios for the years ended december 31 , 2020 , 2019 and 2018 : replace_table_token_19_th -56- results of operations year ended december 31 , 2020 compared to year ended december 31 , 2019 net premiums earned our insurance subsidiaries ' net premiums earned decreased to $ 742.0 million for 2020 , a decrease of $ 14.1 million , or 1.9 % , compared to 2019 , primarily reflecting decreases in personal lines premiums written during 2019 and 2020. our insurance subsidiaries earn premiums and recognize them as income over the terms of the policies they issue . such terms are generally one year or less in duration . therefore , increases or decreases in net premiums earned generally reflect increases or decreases in net premiums written in the preceding twelve-month period compared to the same period one year earlier . net premiums written our insurance subsidiaries ' 2020 net premiums written decreased 1.4 % to $ 742.1 million , compared to $ 752.6 million for 2019. we attribute the decrease primarily to net attrition in our personal lines segment that resulted from increased pricing on renewal policies and underwriting measures our insurance subsidiaries implemented to slow new policy growth and improve profitability , offset somewhat by the impact of premium rate increases and an increase in the writing of new accounts in commercial lines of business . commercial lines net premiums written increased $ 21.1 million , or 5.2 % , for 2020 compared to 2019. personal lines net premiums written decreased $ 31.6 million , or 9.1 % , for 2020 compared to 2019. investment income for 2020 , our net investment income was unchanged at $ 29.5 million , as an increase in average invested assets offset a modest decrease in the average investment yield . net investment gains our net investment gains for 2020 and 2019 were $ 2.8 million and $ 22.0 million , respectively . the net investment gains for 2020 were primarily related to an increase in unrealized gains within our equity securities portfolio . the net investment gains for 2019 included $ 12.7 million from the sale of dfsc and $ 8.9 million related to unrealized gains within our equity securities portfolio . we did not recognize any impairment losses during 2020 or 2019. losses and loss expenses our insurance subsidiaries ' loss ratio , which is the ratio of incurred losses and loss expenses to premiums earned , was 62.0 % for 2020 , compared to 67.0 % for 2019. our insurance subsidiaries ' commercial lines loss ratio increased to 63.9 % for 2020 , compared to 63.0 % for 2019. this increase resulted primarily from the workers ' compensation loss ratio increasing to 51.1 % for 2020 , compared to 44.6 % for 2019 , and the commercial multi-peril loss ratio increasing to 65.9 % for 2020 , compared to 63.1 % for 2019. the personal lines loss ratio decreased to 59.5 % for 2020 , compared to 71.1 % for 2019. the personal automobile loss ratio decreased to 60.1 % for 2020 , compared to 76.1 % for 2019 , primarily as a result of lower claim frequency due to reduced driving activity and traffic density and various underwriting adjustments our insurance subsidiaries -57- implemented in recent years . the homeowners loss ratio decreased to 61.8 % for 2020 , compared to 67.1 % for 2019 , primarily as a result of decreased weather-related losses that we attribute to our exit from several weather-prone markets in 2019. our insurance subsidiaries experienced favorable loss reserve development of approximately $ 12.9 million , or 1.7 percentage points of the loss ratio , during 2020 in their reserves for prior accident years , compared to favorable loss reserve development of approximately $ 12.9 million , or 1.7 percentage points of the loss ratio , during 2019. the favorable loss reserve development in 2020 resulted primarily from lower-than-expected severity in the workers ' compensation and personal automobile lines of business , partially offset by higher-than-expected severity in the commercial automobile and commercial multi-peril lines of business , for accident years prior to 2020. weather-related losses of $ 51.4 million , or 6.9 percentage points of the loss ratio , for 2020 increased from $ 46.1 million , or 6.1 percentage points of the loss ratio , for 2019 , with the increase primarily impacting the commercial multi-peril line of business . underwriting expenses our insurance subsidiaries ' expense ratio , which is the ratio of policy acquisition and other underwriting expenses to premiums earned , was 33.0 % for 2020 , compared to 31.3 % for 2019. we attribute the modest increase to higher commercial growth incentive costs for our agents , higher underwriting-based incentive compensation for our agents and employees and higher technology-related expenses for 2020 compared to 2019. the increase in technology systems-related expenses for 2020 was primarily due to an increased allocation of costs from donegal mutual to our insurance subsidiaries following the successful implementation of the first phase of our ongoing systems modernization project in february 2020. policyholder dividends our insurance subsidiaries pay policyholder dividends primarily on workers ' compensation policies on a sliding scale based on the profitability of a given policy . we attribute the decrease in dividends incurred for 2020 compared to 2019 to a modest decline in the profitability of the workers ' compensation line of business over the respective

liquidity and capital resources liquidity is a measure of an entity 's ability to secure enough cash to meet its contractual obligations and operating needs as they arise . our major sources of funds from operations are the net cash flows generated from our insurance subsidiaries ' underwriting results , investment income and maturing investments . we have historically generated sufficient net positive cash flow from our operations to fund our commitments and build our investment portfolio , thereby increasing future investment returns . the pooling agreement with donegal mutual historically has been cash flow positive because of the profitability of the underwriting pool . because we settle the pool monthly , our cash flows are substantially similar to the cash flows that would result from the underwriting of direct business . we maintain a high degree of liquidity in our investment portfolio in the form of marketable fixed maturities , equity securities and short-term investments . we structure our fixed-maturity investment portfolio following a “ laddering ” approach so that projected cash flows from investment income and principal maturities are evenly distributed from a timing perspective . this laddering approach provides an additional measure of liquidity to meet our obligations and the obligations of our insurance subsidiaries should an unexpected variation occur in the future . net cash flows provided by operating activities in 2020 , 2019 and 2018 were $ 101.1 million , $ 76.4 million and $ 63.8 million , respectively . in august 2020 , we entered into a new credit agreement with manufacturers and traders trust company ( “ m & t ” ) that related to a $ 20.0 million unsecured demand line of credit . the line of credit has no expiration date , no annual fees and no covenants . at december 31 , 2020 , we had no outstanding borrowings from m & t and had the ability to borrow up to $ 20.0 million at interest rates equal to the then-current libor rate plus 2.00 % .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```liquidity and capital resources liquidity is a measure of an entity 's ability to secure enough cash to meet its contractual obligations and operating needs as they arise . our major sources of funds from operations are the net cash flows generated from our insurance subsidiaries ' underwriting results , investment income and maturing investments . we have historically generated sufficient net positive cash flow from our operations to fund our commitments and build our investment portfolio , thereby increasing future investment returns . the pooling agreement with donegal mutual historically has been cash flow positive because of the profitability of the underwriting pool . because we settle the pool monthly , our cash flows are substantially similar to the cash flows that would result from the underwriting of direct business . we maintain a high degree of liquidity in our investment portfolio in the form of marketable fixed maturities , equity securities and short-term investments . we structure our fixed-maturity investment portfolio following a “ laddering ” approach so that projected cash flows from investment income and principal maturities are evenly distributed from a timing perspective . this laddering approach provides an additional measure of liquidity to meet our obligations and the obligations of our insurance subsidiaries should an unexpected variation occur in the future . net cash flows provided by operating activities in 2020 , 2019 and 2018 were $ 101.1 million , $ 76.4 million and $ 63.8 million , respectively . in august 2020 , we entered into a new credit agreement with manufacturers and traders trust company ( “ m & t ” ) that related to a $ 20.0 million unsecured demand line of credit . the line of credit has no expiration date , no annual fees and no covenants . at december 31 , 2020 , we had no outstanding borrowings from m & t and had the ability to borrow up to $ 20.0 million at interest rates equal to the then-current libor rate plus 2.00 % . ``` Suspicious Activity Report : we recorded a gain of $ 12.7 million from the sale of dfsc in our results of operations during 2019. we sold the northwest common stock that we received as part of the consideration during 2019. this transaction represented the culmination of a banking strategy that began with the formation of dfsc in 2000. effective december 1 , 2019 , our insurance subsidiaries le mars insurance company ( “ le mars ” ) and sheboygan falls insurance company ( “ sheboygan falls ” ) merged with and into atlantic states ( the “ mergers ” ) . as a result of the mergers , the separate corporate existences of le mars and sheboygan falls ceased and atlantic states continued as the surviving insurance company . atlantic states placed the business of le mars and sheboygan falls , as their policies renewed subsequent to the effective date of the mergers , into the underwriting pool . at december 31 , 2020 , donegal mutual held approximately 42 % of our outstanding class a common stock and approximately 84 % of our outstanding class b common stock . this ownership provides donegal mutual with approximately 71 % of the combined voting power of our outstanding shares of class a common stock and our outstanding shares of class b common stock . -48- donegal mutual and atlantic states have participated in a proportional reinsurance agreement , or pooling agreement , since 1986. under the pooling agreement , donegal mutual and atlantic states contribute substantially all of their respective premiums , losses and loss expenses to the underwriting pool , and the underwriting pool , acting through donegal mutual , then allocates 80 % of the pooled business to atlantic states . thus , donegal mutual and atlantic states share the underwriting results of the pooled business in proportion to their respective participation in the underwriting pool . the operations of our insurance subsidiaries and donegal mutual are interrelated due to the pooling agreement and other factors . while maintaining the separate corporate existence of each company , our insurance subsidiaries conduct business together with donegal mutual and its insurance subsidiaries as the donegal insurance group . the donegal insurance group is not a legal entity , is not an insurance company and does not issue or administer insurance policies . rather , it is a trade name that refers to the group of insurance companies that are affiliated with donegal mutual . see “ business - history and organizational structure ” for more information regarding the pooling agreement and other transactions with our affiliates . in july 2013 , our board of directors authorized a share repurchase program pursuant to which we have the authority to purchase up to 500,000 additional shares of our class a common stock at prices prevailing from time to time in the open market subject to the provisions of the sec rule 10b-18 and in privately negotiated transactions . we did not purchase any shares of our class a common stock under this program during 2020 or 2019. we have purchased a total of 57,658 shares of our class a common stock under this program from its inception through december 31 , 2020. critical accounting policies and estimates we combine our financial statements with those of our insurance subsidiaries and present them on a consolidated basis in accordance with gaap . our insurance subsidiaries make estimates and assumptions that can have a significant effect on amounts and disclosures we report in our financial statements . the most significant estimates relate to the reserves of our insurance subsidiaries for property and casualty insurance unpaid losses and loss expenses . while we believe our estimates and the estimates of our insurance subsidiaries are appropriate , the ultimate amounts may differ from the estimates we provided . we regularly review our methods for making these estimates , and we reflect any adjustment we consider necessary in our results of operations for the period in which we make an adjustment . liability for losses and loss expenses liabilities for losses and loss expenses are estimates at a given point in time of the amounts an insurer expects to pay with respect to incurred policyholder claims based on facts and circumstances the insurer knows at that point in time . for example , legislative , judicial and regulatory actions may expand coverage definitions , retroactively mandate coverage or otherwise require our insurance subsidiaries to pay losses for damages that their policies explicitly excluded or did not intend to cover . at the time of establishing its estimates , an insurer recognizes that its ultimate liability for losses and loss expenses will exceed or be less than such estimates . our insurance subsidiaries base their estimates of liabilities for losses and loss expenses on assumptions as to future loss trends , expected claims severity , judicial theories of liability and other factors . however , during the loss adjustment period , our insurance subsidiaries may learn additional facts regarding individual claims , and , consequently , it often becomes necessary for our insurance subsidiaries to refine and adjust their estimates for these liabilities . we reflect any adjustments to the liabilities for losses and loss expenses of our insurance subsidiaries in our consolidated results of operations in the period in which our insurance subsidiaries make adjustments to their estimates . our insurance subsidiaries maintain liabilities for the payment of losses and loss expenses with respect to both reported and unreported claims . our insurance subsidiaries establish these liabilities for the purpose of covering the ultimate costs of settling all losses , including investigation and litigation costs . our insurance subsidiaries base the amount of their liability for reported losses primarily upon a case-by-case evaluation of the type of risk involved , knowledge of the circumstances -49- surrounding each claim and the insurance policy provisions relating to the type of loss the policyholder incurred . story_separator_special_tag the calculation of our statutory combined ratio differs from the calculation of our gaap combined ratio . in calculating our gaap combined ratio , we do not deduct installment payment fees from incurred expenses , and we base the expense ratio on net premiums earned instead of net premiums written . differences between our gaap loss ratio and our statutory loss ratio result from anticipating salvage and subrogation recoveries for our gaap loss ratio but not for our statutory loss ratio . the following table presents comparative details with respect to our gaap and statutory combined ratios for the years ended december 31 , 2020 , 2019 and 2018 : replace_table_token_19_th -56- results of operations year ended december 31 , 2020 compared to year ended december 31 , 2019 net premiums earned our insurance subsidiaries ' net premiums earned decreased to $ 742.0 million for 2020 , a decrease of $ 14.1 million , or 1.9 % , compared to 2019 , primarily reflecting decreases in personal lines premiums written during 2019 and 2020. our insurance subsidiaries earn premiums and recognize them as income over the terms of the policies they issue . such terms are generally one year or less in duration . therefore , increases or decreases in net premiums earned generally reflect increases or decreases in net premiums written in the preceding twelve-month period compared to the same period one year earlier . net premiums written our insurance subsidiaries ' 2020 net premiums written decreased 1.4 % to $ 742.1 million , compared to $ 752.6 million for 2019. we attribute the decrease primarily to net attrition in our personal lines segment that resulted from increased pricing on renewal policies and underwriting measures our insurance subsidiaries implemented to slow new policy growth and improve profitability , offset somewhat by the impact of premium rate increases and an increase in the writing of new accounts in commercial lines of business . commercial lines net premiums written increased $ 21.1 million , or 5.2 % , for 2020 compared to 2019. personal lines net premiums written decreased $ 31.6 million , or 9.1 % , for 2020 compared to 2019. investment income for 2020 , our net investment income was unchanged at $ 29.5 million , as an increase in average invested assets offset a modest decrease in the average investment yield . net investment gains our net investment gains for 2020 and 2019 were $ 2.8 million and $ 22.0 million , respectively . the net investment gains for 2020 were primarily related to an increase in unrealized gains within our equity securities portfolio . the net investment gains for 2019 included $ 12.7 million from the sale of dfsc and $ 8.9 million related to unrealized gains within our equity securities portfolio . we did not recognize any impairment losses during 2020 or 2019. losses and loss expenses our insurance subsidiaries ' loss ratio , which is the ratio of incurred losses and loss expenses to premiums earned , was 62.0 % for 2020 , compared to 67.0 % for 2019. our insurance subsidiaries ' commercial lines loss ratio increased to 63.9 % for 2020 , compared to 63.0 % for 2019. this increase resulted primarily from the workers ' compensation loss ratio increasing to 51.1 % for 2020 , compared to 44.6 % for 2019 , and the commercial multi-peril loss ratio increasing to 65.9 % for 2020 , compared to 63.1 % for 2019. the personal lines loss ratio decreased to 59.5 % for 2020 , compared to 71.1 % for 2019. the personal automobile loss ratio decreased to 60.1 % for 2020 , compared to 76.1 % for 2019 , primarily as a result of lower claim frequency due to reduced driving activity and traffic density and various underwriting adjustments our insurance subsidiaries -57- implemented in recent years . the homeowners loss ratio decreased to 61.8 % for 2020 , compared to 67.1 % for 2019 , primarily as a result of decreased weather-related losses that we attribute to our exit from several weather-prone markets in 2019. our insurance subsidiaries experienced favorable loss reserve development of approximately $ 12.9 million , or 1.7 percentage points of the loss ratio , during 2020 in their reserves for prior accident years , compared to favorable loss reserve development of approximately $ 12.9 million , or 1.7 percentage points of the loss ratio , during 2019. the favorable loss reserve development in 2020 resulted primarily from lower-than-expected severity in the workers ' compensation and personal automobile lines of business , partially offset by higher-than-expected severity in the commercial automobile and commercial multi-peril lines of business , for accident years prior to 2020. weather-related losses of $ 51.4 million , or 6.9 percentage points of the loss ratio , for 2020 increased from $ 46.1 million , or 6.1 percentage points of the loss ratio , for 2019 , with the increase primarily impacting the commercial multi-peril line of business . underwriting expenses our insurance subsidiaries ' expense ratio , which is the ratio of policy acquisition and other underwriting expenses to premiums earned , was 33.0 % for 2020 , compared to 31.3 % for 2019. we attribute the modest increase to higher commercial growth incentive costs for our agents , higher underwriting-based incentive compensation for our agents and employees and higher technology-related expenses for 2020 compared to 2019. the increase in technology systems-related expenses for 2020 was primarily due to an increased allocation of costs from donegal mutual to our insurance subsidiaries following the successful implementation of the first phase of our ongoing systems modernization project in february 2020. policyholder dividends our insurance subsidiaries pay policyholder dividends primarily on workers ' compensation policies on a sliding scale based on the profitability of a given policy . we attribute the decrease in dividends incurred for 2020 compared to 2019 to a modest decline in the profitability of the workers ' compensation line of business over the respective

investment portfolio , the interest rate 28 sensitivity of peoples ' consolidated balance sheet , and the income generated by peoples ' trust and investment activities ; ( 15 ) peoples ' ability to receive dividends from its subsidiaries ; ( 16 ) peoples ' ability to maintain required capital levels and adequate sources of funding and liquidity ; ( 17 ) the impact of new minimum capital thresholds established as a part of the implementation of basel iii ; ( 18 ) the impact of larger or similar sized financial institutions encountering problems , which may adversely affect the banking industry and or peoples ' business generation and retention , funding and liquidity ; ( 19 ) the costs and effects of regulatory and legal developments , including the outcome of potential regulatory or other governmental inquiries and legal proceedings and results of regulatory examinations ; ( 20 ) peoples ' ability to secure confidential information through the use of computer systems and telecommunications networks , including those of peoples ' third-party vendors and other service providers , may prove inadequate , which could adversely affect customer confidence in peoples and or result in peoples incurring a financial loss ; ( 21 ) changes in consumer spending , borrowing and saving habits , whether due to changes in business and economic conditions , legislative or regulatory initiatives , or other factors , which may be different than anticipated ; ( 22 ) the overall adequacy of peoples ' risk management program ; ( 23 ) the impact on peoples ' businesses , as well as on the risks described above , of various domestic or international military or terrorist activities or conflicts ; ( 24 ) significant changes in the tax laws , which may adversely affect the fair values of net deferred tax assets and obligations of states and political subdivisions held in peoples ' investment securities portfolio ; and ( 25 ) other risk factors relating to the banking industry or peoples as detailed from time to time in peoples ' reports filed with the sec , including those risk factors included in the disclosures under the heading `` item 1a . risk factors `` of this form 10-k. all forward-looking statements speak only as of the filing date of this form 10-k and are expressly qualified in their entirety by the cautionary statements . although management believes the expectations in these forward-looking statements are based on reasonable assumptions within the bounds of management 's knowledge of peoples ' business and operations , it is possible that actual results may differ materially from these projections . additionally , peoples undertakes no obligation to update these forward-looking statements to reflect events or circumstances after the filing date of this form 10-k or to reflect the occurrence of unanticipated events except as may be required by applicable legal requirements . copies of documents filed with the sec are available free of charge at the sec 's website at www.sec.gov and or from peoples ' website – www.peoplesbancorp.com under the `` investor relations `` section . the following discussion and analysis of peoples ' consolidated financial statements is presented to provide insight into management 's assessment of the financial position and results of operations for the periods presented . this discussion and analysis should be read in conjunction with the audited consolidated financial statements and notes thereto , as well as the ratios and statistics , contained elsewhere in this form 10-k. summary of significant transactions and events the following is a summary of transactions or events that have impacted or are expected by management to impact peoples ' results of operations or financial condition : ◦ on january 31 , 2017 , peoples insurance acquired a third-party insurance administration company with annual net revenue of $ 0.4 million . this acquisition did not materially impact peoples ' financial position , results of operations or cash flows . ◦ on november 7 , 2016 , peoples converted its core banking system ( including the related operating systems , data systems and products ) . the conversion resulted in a pre-tax combined revenue and expense impact of $ 1.3 million , or $ 0.05 in earnings per diluted share , for the full year . deposit account service charges were impacted by the system conversion as peoples granted waivers of $ 85,000 related to account services charges in the month of the conversion . the remainder of the $ 1.3 million was recorded in various expense categories , primarily in other non-interest expense , professional fees , and salaries and employee benefit costs . 29 ◦ in 2016 , peoples closed three ohio branches that were located in owensville , marietta and the plains . additional branches to close in 2017 include two ohio offices located in belpre and wilmington , and two west virginia offices located in huntington and point pleasant . these four branches will remain open through march 31 , 2017 . ◦ peoples continually evaluates the overall balance sheet position given the interest rate environment . during 2016 , peoples executed transactions to take advantage of the low interest rates , which included : ▪ peoples restructured $ 20.0 million of fhlb long-term advance borrowings that had a weighted-average rate of 2.97 % , resulting in a $ 700,000 loss . peoples replaced these borrowings with a long-term fhlb advance , which has an interest rate of 2.17 % and matures in 2026 . ▪ peoples borrowed an additional $ 35.0 million of long-term fhlb amortizing advances , which had interest rates ranging from 1.08 % to 1.40 % , and mature between 2019 and 2031 . story_separator_special_tag peoples performs its required annual impairment test as of october 1st each year , beginning in 2016. peoples first assesses qualitative factors to determine whether it is more likely than not that the fair value of the reporting unit is less than its carrying amount , including goodwill . in this evaluation , peoples assesses relevant events and circumstances , which may include macroeconomic conditions , industry and market conditions , cost factors , overall financial performance , events specific to peoples , significant changes in the reporting unit , or a sustained decrease in stock price . if peoples determines that it is more likely than not that the fair value of the reporting unit is greater than its carrying amount , then performing the two-step impairment test is unnecessary . however , if there are indicators of impairment , peoples must complete a two-step process that includes ( 1 ) determining if potential goodwill impairment exists and ( 2 ) measuring the impairment loss , if any . at october 1 , 2016 , management 's qualitative analysis concluded that the estimated fair value of peoples ' single reporting unit exceeded its carrying value . peoples is required to perform interim tests for goodwill impairment in subsequent quarters if events occur or circumstances change that indicate potential goodwill impairment exists , such as adverse changes to peoples ' business or a significant decline in peoples ' market capitalization . for further information regarding goodwill , refer to note 6 of the notes to the consolidated financial statements . peoples records servicing rights ( “ srs ” ) in connection with its mortgage banking and small business lending activities , which are intangible assets representing the right to service loans sold to third-party investors . these intangible assets are recorded initially at fair value and subsequently amortized over the estimated life of the loans sold . srs are stratified based on their predominant risk characteristics and assessed for impairment at the strata level at each reporting date based on their fair value . at december 31 , 2016 , management concluded no portion of the recorded srs was impaired since the fair value equaled or exceeded the carrying value . however , future events , such as a significant increase in prepayment speeds , could result in a fair value that is less than the carrying amount , which would require the recognition of an impairment loss in earnings . income taxes income taxes are recorded based on the liability method of accounting , which includes the recognition of deferred tax assets and liabilities for the temporary differences between carrying amounts and tax bases of assets and liabilities , computed using enacted tax rates . in general , peoples records deferred tax assets when the event giving rise to the tax benefit has been recognized in the consolidated financial statements . a valuation allowance is recognized to reduce any deferred tax asset when , based upon available information , it is more-likely-than-not all , or any portion , of the deferred tax asset will not be realized . assessing the need for , and amount of , a valuation allowance for deferred tax assets requires significant judgment and analysis of evidence regarding realization of the deferred tax assets . in most cases , the realization of deferred tax assets is dependent upon peoples generating a sufficient level of taxable income in future periods , which can be difficult to predict . peoples ' largest deferred tax assets involve differences related to peoples ' allowance for loan losses and accrued employee benefits . at december 31 , 2016 and december 31 , 2015 , management determined a valuation allowance would be recorded against the deferred tax assets associated with its investment in a partnership investment . no other valuation allowances were recorded at either december 31 , 2016 or 2015 . the calculation of tax liabilities is complex and requires the use of estimates and judgment since it involves the application of complex tax laws that are subject to different interpretations by peoples and the various tax authorities . peoples ' interpretations are subject to challenge by the tax authorities upon audit or to reinterpretation based on management 's ongoing assessment of facts and evolving case law . 33 from time-to-time and in the ordinary course of business , peoples is involved in inquiries and reviews by tax authorities that normally require management to provide supplemental information to support certain tax positions taken by peoples in its tax returns . uncertain tax positions are initially recognized in the consolidated financial statements when it is more likely than not the position will be sustained upon examination by the tax authorities . such tax positions are initially and subsequently measured as the largest amount of tax benefit that is greater than 50 % likely of being realized upon ultimate settlement with the tax authority assuming full knowledge of the position and all relevant facts . the amount of unrecognized tax benefits was immaterial at both december 31 , 2016 and 2015 . management believes it has taken appropriate positions on its tax returns , although the ultimate outcome of any tax review can not be predicted with certainty . consequently , no assurance can be given that the final outcome of these matters will not be different than what is reflected in the current and historical financial statements . fair value measurements as a financial services company , the carrying value of certain financial assets and liabilities is impacted by the application of fair value measurements , either directly or indirectly . in certain cases , an asset or liability is measured and reported at fair value on a recurring basis , such as available-for-sale investment securities . in other cases , management must rely on estimates or judgments to determine if an asset or liability not measured at fair value warrants an impairment write-down or whether a valuation reserve should be

cash flow hedges cash flow hedges are carried at fair value on peoples ' consolidated balance sheets . cash flow hedges do not trade in an active market with readily observable prices . management determines the fair value of cash flow hedges based on third-party pricing , which is driven by changes in market interest rates . as of december 31 , 2016 , the fair value of the cash flow hedges , based on market interest rates , resulted in an asset of $ 1.8 million . executive summary net income for the year ended december 31 , 2016 was $ 31.2 million , compared to $ 10.9 million in 2015 and $ 16.7 million in 2014 , representing earnings per diluted common share of $ 1.71 , $ 0.61 and $ 1.35 , respectively . the increase in earnings during 2016 was driven by a decrease in the provision for loan losses of $ 10.6 million , primarily due to the control of credit quality and associated credit costs . in 2016 , earnings also benefited from a decrease in acquisition-related charges of $ 10.7 million compared to 2015 , which was partially offset by costs related to the conversion of peoples ' core banking system of $ 1.3 million .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```cash flow hedges cash flow hedges are carried at fair value on peoples ' consolidated balance sheets . cash flow hedges do not trade in an active market with readily observable prices . management determines the fair value of cash flow hedges based on third-party pricing , which is driven by changes in market interest rates . as of december 31 , 2016 , the fair value of the cash flow hedges , based on market interest rates , resulted in an asset of $ 1.8 million . executive summary net income for the year ended december 31 , 2016 was $ 31.2 million , compared to $ 10.9 million in 2015 and $ 16.7 million in 2014 , representing earnings per diluted common share of $ 1.71 , $ 0.61 and $ 1.35 , respectively . the increase in earnings during 2016 was driven by a decrease in the provision for loan losses of $ 10.6 million , primarily due to the control of credit quality and associated credit costs . in 2016 , earnings also benefited from a decrease in acquisition-related charges of $ 10.7 million compared to 2015 , which was partially offset by costs related to the conversion of peoples ' core banking system of $ 1.3 million . ``` Suspicious Activity Report : investment portfolio , the interest rate 28 sensitivity of peoples ' consolidated balance sheet , and the income generated by peoples ' trust and investment activities ; ( 15 ) peoples ' ability to receive dividends from its subsidiaries ; ( 16 ) peoples ' ability to maintain required capital levels and adequate sources of funding and liquidity ; ( 17 ) the impact of new minimum capital thresholds established as a part of the implementation of basel iii ; ( 18 ) the impact of larger or similar sized financial institutions encountering problems , which may adversely affect the banking industry and or peoples ' business generation and retention , funding and liquidity ; ( 19 ) the costs and effects of regulatory and legal developments , including the outcome of potential regulatory or other governmental inquiries and legal proceedings and results of regulatory examinations ; ( 20 ) peoples ' ability to secure confidential information through the use of computer systems and telecommunications networks , including those of peoples ' third-party vendors and other service providers , may prove inadequate , which could adversely affect customer confidence in peoples and or result in peoples incurring a financial loss ; ( 21 ) changes in consumer spending , borrowing and saving habits , whether due to changes in business and economic conditions , legislative or regulatory initiatives , or other factors , which may be different than anticipated ; ( 22 ) the overall adequacy of peoples ' risk management program ; ( 23 ) the impact on peoples ' businesses , as well as on the risks described above , of various domestic or international military or terrorist activities or conflicts ; ( 24 ) significant changes in the tax laws , which may adversely affect the fair values of net deferred tax assets and obligations of states and political subdivisions held in peoples ' investment securities portfolio ; and ( 25 ) other risk factors relating to the banking industry or peoples as detailed from time to time in peoples ' reports filed with the sec , including those risk factors included in the disclosures under the heading `` item 1a . risk factors `` of this form 10-k. all forward-looking statements speak only as of the filing date of this form 10-k and are expressly qualified in their entirety by the cautionary statements . although management believes the expectations in these forward-looking statements are based on reasonable assumptions within the bounds of management 's knowledge of peoples ' business and operations , it is possible that actual results may differ materially from these projections . additionally , peoples undertakes no obligation to update these forward-looking statements to reflect events or circumstances after the filing date of this form 10-k or to reflect the occurrence of unanticipated events except as may be required by applicable legal requirements . copies of documents filed with the sec are available free of charge at the sec 's website at www.sec.gov and or from peoples ' website – www.peoplesbancorp.com under the `` investor relations `` section . the following discussion and analysis of peoples ' consolidated financial statements is presented to provide insight into management 's assessment of the financial position and results of operations for the periods presented . this discussion and analysis should be read in conjunction with the audited consolidated financial statements and notes thereto , as well as the ratios and statistics , contained elsewhere in this form 10-k. summary of significant transactions and events the following is a summary of transactions or events that have impacted or are expected by management to impact peoples ' results of operations or financial condition : ◦ on january 31 , 2017 , peoples insurance acquired a third-party insurance administration company with annual net revenue of $ 0.4 million . this acquisition did not materially impact peoples ' financial position , results of operations or cash flows . ◦ on november 7 , 2016 , peoples converted its core banking system ( including the related operating systems , data systems and products ) . the conversion resulted in a pre-tax combined revenue and expense impact of $ 1.3 million , or $ 0.05 in earnings per diluted share , for the full year . deposit account service charges were impacted by the system conversion as peoples granted waivers of $ 85,000 related to account services charges in the month of the conversion . the remainder of the $ 1.3 million was recorded in various expense categories , primarily in other non-interest expense , professional fees , and salaries and employee benefit costs . 29 ◦ in 2016 , peoples closed three ohio branches that were located in owensville , marietta and the plains . additional branches to close in 2017 include two ohio offices located in belpre and wilmington , and two west virginia offices located in huntington and point pleasant . these four branches will remain open through march 31 , 2017 . ◦ peoples continually evaluates the overall balance sheet position given the interest rate environment . during 2016 , peoples executed transactions to take advantage of the low interest rates , which included : ▪ peoples restructured $ 20.0 million of fhlb long-term advance borrowings that had a weighted-average rate of 2.97 % , resulting in a $ 700,000 loss . peoples replaced these borrowings with a long-term fhlb advance , which has an interest rate of 2.17 % and matures in 2026 . ▪ peoples borrowed an additional $ 35.0 million of long-term fhlb amortizing advances , which had interest rates ranging from 1.08 % to 1.40 % , and mature between 2019 and 2031 . story_separator_special_tag peoples performs its required annual impairment test as of october 1st each year , beginning in 2016. peoples first assesses qualitative factors to determine whether it is more likely than not that the fair value of the reporting unit is less than its carrying amount , including goodwill . in this evaluation , peoples assesses relevant events and circumstances , which may include macroeconomic conditions , industry and market conditions , cost factors , overall financial performance , events specific to peoples , significant changes in the reporting unit , or a sustained decrease in stock price . if peoples determines that it is more likely than not that the fair value of the reporting unit is greater than its carrying amount , then performing the two-step impairment test is unnecessary . however , if there are indicators of impairment , peoples must complete a two-step process that includes ( 1 ) determining if potential goodwill impairment exists and ( 2 ) measuring the impairment loss , if any . at october 1 , 2016 , management 's qualitative analysis concluded that the estimated fair value of peoples ' single reporting unit exceeded its carrying value . peoples is required to perform interim tests for goodwill impairment in subsequent quarters if events occur or circumstances change that indicate potential goodwill impairment exists , such as adverse changes to peoples ' business or a significant decline in peoples ' market capitalization . for further information regarding goodwill , refer to note 6 of the notes to the consolidated financial statements . peoples records servicing rights ( “ srs ” ) in connection with its mortgage banking and small business lending activities , which are intangible assets representing the right to service loans sold to third-party investors . these intangible assets are recorded initially at fair value and subsequently amortized over the estimated life of the loans sold . srs are stratified based on their predominant risk characteristics and assessed for impairment at the strata level at each reporting date based on their fair value . at december 31 , 2016 , management concluded no portion of the recorded srs was impaired since the fair value equaled or exceeded the carrying value . however , future events , such as a significant increase in prepayment speeds , could result in a fair value that is less than the carrying amount , which would require the recognition of an impairment loss in earnings . income taxes income taxes are recorded based on the liability method of accounting , which includes the recognition of deferred tax assets and liabilities for the temporary differences between carrying amounts and tax bases of assets and liabilities , computed using enacted tax rates . in general , peoples records deferred tax assets when the event giving rise to the tax benefit has been recognized in the consolidated financial statements . a valuation allowance is recognized to reduce any deferred tax asset when , based upon available information , it is more-likely-than-not all , or any portion , of the deferred tax asset will not be realized . assessing the need for , and amount of , a valuation allowance for deferred tax assets requires significant judgment and analysis of evidence regarding realization of the deferred tax assets . in most cases , the realization of deferred tax assets is dependent upon peoples generating a sufficient level of taxable income in future periods , which can be difficult to predict . peoples ' largest deferred tax assets involve differences related to peoples ' allowance for loan losses and accrued employee benefits . at december 31 , 2016 and december 31 , 2015 , management determined a valuation allowance would be recorded against the deferred tax assets associated with its investment in a partnership investment . no other valuation allowances were recorded at either december 31 , 2016 or 2015 . the calculation of tax liabilities is complex and requires the use of estimates and judgment since it involves the application of complex tax laws that are subject to different interpretations by peoples and the various tax authorities . peoples ' interpretations are subject to challenge by the tax authorities upon audit or to reinterpretation based on management 's ongoing assessment of facts and evolving case law . 33 from time-to-time and in the ordinary course of business , peoples is involved in inquiries and reviews by tax authorities that normally require management to provide supplemental information to support certain tax positions taken by peoples in its tax returns . uncertain tax positions are initially recognized in the consolidated financial statements when it is more likely than not the position will be sustained upon examination by the tax authorities . such tax positions are initially and subsequently measured as the largest amount of tax benefit that is greater than 50 % likely of being realized upon ultimate settlement with the tax authority assuming full knowledge of the position and all relevant facts . the amount of unrecognized tax benefits was immaterial at both december 31 , 2016 and 2015 . management believes it has taken appropriate positions on its tax returns , although the ultimate outcome of any tax review can not be predicted with certainty . consequently , no assurance can be given that the final outcome of these matters will not be different than what is reflected in the current and historical financial statements . fair value measurements as a financial services company , the carrying value of certain financial assets and liabilities is impacted by the application of fair value measurements , either directly or indirectly . in certain cases , an asset or liability is measured and reported at fair value on a recurring basis , such as available-for-sale investment securities . in other cases , management must rely on estimates or judgments to determine if an asset or liability not measured at fair value warrants an impairment write-down or whether a valuation reserve should be

the gaap to non-gaap reconciliation presents non-gaap financial measures that exclude the impact of charges or gains that contribute to or reduce earnings and that may affect financial trends , but which include charges or benefits that result from transactions or events that management believes may or may not recur with similar materiality or impact to our operations in future periods ( non-gaap adjustments ) . in the event there is a non-gaap adjustment recognized in our operating results , the tax cost or benefit attributable to that item is separately calculated . because the effective rate may be significantly affected by the non-gaap adjustments that take place during the period , we often refer to our tax rate using both the effective rate and the non-gaap nominal tax rate ( non-gaap nominal tax rate ) . the non-gaap nominal tax rate is calculated as the provision for income taxes , adjusted for the impact of non-gaap adjustments , as a percentage of income from operations before income taxes , excluding non-gaap adjustments . 39 free cash flow is a non-gaap financial measure calculated by subtracting additions to property , plant , and equipment from net cash provided by operating activities . refer to the “ gaap to non-gaap reconciliation , `` `` income taxes , `` and `` summary of cash flows `` sections for reconciliations of our results of operations prepared in accordance with u.s. gaap to the adjusted non-gaap financial measures considered by management . executive level overview medtronic is among the world 's largest medical technology , services , and solutions companies - alleviating pain , restoring health , and extending life for millions of people around the world . we employ more than 91,000 full-time employees worldwide , serving physicians , hospitals , and patients in approximately 160 countries . our primary products include those for cardiac rhythm disorders , cardiovascular disease , advanced and general surgical care , respiratory and monitoring solutions , neurological disorders , spinal conditions and musculoskeletal trauma , urological and digestive disorders , and ear , nose , and throat and diabetes conditions . net income attributable to medtronic for fiscal year 2017 was $ 4.0 billion , $ 2.89 per diluted share , as compared to net income attributable to medtronic of $ 3.5 billion , $ 2.48 per diluted share , for fiscal year 2016 , representing an increase of 14 percent and 17 percent , respectively . the table below illustrates net sales by operating segment for fiscal years 2017 , 2016 , and 2015 : replace_table_token_6_th ( 1 ) the minimally invasive therapies group was a new group in the fourth quarter of fiscal year 2015 that contains the majority of covidien 's former operations . revenue growth is compared to a full year of operations in fiscal year 2016. currency translation had an unfavorable impact of $ 34 million on net sales for fiscal year 2017 , as compared to fiscal year 2016 when using the average exchange rates in effect during fiscal year 2016 . net sales growth for fiscal year 2017 was also unfavorably affected by an additional selling week during the first quarter of fiscal year 2016 , resulting from our 52/53 week fiscal year calendar . in addition , the fiscal year 2017 acquisitions of heartware and smith & nephew 's gynecology business contributed $ 200 million to our total net sales growth . our performance continues to be fueled by our three growth strategies : therapy innovation , globalization , and economic value . we are creating competitive advantages and capitalizing on the long-term trends in healthcare : namely , the desire to improve clinical outcomes ; the growing demand for expanded access to care ; and the optimization of cost and efficiency within healthcare systems . in our therapy innovation growth strategy , we continue to see strong adoption of our products across all our operating segments . further discussion about our products is included within the operating segment sections below . in globalization , net sales in emerging markets and non-u.s. developed markets grew 7 percent and 4 percent , respectively , in fiscal year 2017 compared to fiscal year 2016 . in our third growth strategy , economic value , we continue to execute our value-based healthcare signature programs and remain focused on leading the shift to healthcare payment systems that reward value and improved patient outcomes over volume . see our discussion in the “ net sales ” section of this management 's discussion and analysis for more information on the results of our operating segments . gaap to non-gaap reconciliation we have provided non-gaap financial measures , because we believe they provide meaningful information regarding our results on a consistent and comparable basis for the periods presented . management uses these non-gaap financial measures to facilitate its review of our operational performance and as a basis for strategic planning . management believes that non-gaap financial measures provide useful information to investors regarding the underlying business trends and performance of our ongoing operations and are useful for period over period comparisons of such operations . refer to our discussion in the `` costs and expenses `` and `` income taxes `` sections of this management 's discussion and analysis for more information on the non-gaap adjustments . investors should not consider results reflecting non-gaap financial measures in isolation from , or as a substitute for , financial information prepared in accordance with u.s. gaap , and should be cautioned that we may calculate results reflecting non-gaap financial measures in a manner that is different from other companies . 40 replace_table_token_7_th ( 1 ) the tax effect of each non-gaap adjustment is based on the jurisdictions in which the expense ( income ) is incurred and the tax laws in effect for each such jurisdiction . story_separator_special_tag coronary & structural heart net sales for fiscal year 2016 were $ 3.1 billion , an increase of 2 percent compared to fiscal year 2015. net sales were driven by the corevalve evolut r recapturable system in the u.s. , which was launched late in the first quarter of fiscal year 2016 , and a strong corevalve launch in japan in the fourth quarter of fiscal year 2016. in addition , net sales of coronary & structural heart division were driven by drug-eluting stents , including the resolute onyx drug-eluting stent in europe and the resolute integrity drug-eluting stent in the u.s. , and the recent launches of the nc euphora and sc euphora balloon dilatation catheters . net sales were partially offset by continued pricing pressures in our coronary business . aortic & peripheral vascular net sales for fiscal year 2016 were $ 1.6 billion , an increase of 52 percent compared to fiscal year 2015. the aortic & peripheral vascular division net sales performance benefited from the addition of the covidien peripheral business in the fourth quarter of fiscal year 2015. the increase in aortic & peripheral vascular net sales was driven by strong growth of the in.pact admiral drug-coated balloon in the u.s. and globally , continued strength in valiant captiva taa stent graft sales , continued solid adoption of our aptus heli-fx endoanchor , and continued adoption of the endurant iis abdominal aortic aneurysm ( aaa ) 3-piece system in the u.s. net sales for the aortic & peripheral vascular division were affected by increased competition in international markets and reimbursement cuts in japan . looking ahead , we expect our cardiac and vascular group could be affected by the following : changes in procedural volumes , competitive and pricing pressure , geographic macro-economic risks , reimbursement challenges , impacts from changes in the mix of our product offerings , the timing of product registration approvals , replacement cycle challenges , and fluctuations in currency exchange rates . integration of our acquisition of heartware , a leading innovator of the heartware ventricular assist system ( hvad system ) , to treat patients around the world suffering from advanced heart failure . the acquisition of heartware in august 2016 broadened the medtronic portfolio of therapies , diagnostic tools and services for patients suffering from heart failure and is part of our therapy innovation strategy to surround the physician with innovative products while focusing on patients and disease states . acceptance and future growth of the crt-p quadripolar pacing system , which received ce mark approval in february 2017 and launched in europe during the fourth quarter of fiscal year 2017. in the u.s. , we received fda approval in may 2017 , and launched in the first quarter of fiscal year 2018. acceptance and future growth of the claria mri crt-d system with effectivcrt diagnostic and effective crt during af algorithm , which launched in the u.s. late in the third quarter of fiscal year 2017 and is expected to launch in japan in fiscal year 2018 . 45 continued future growth from the reveal linq insertable cardiac monitor , which launched in japan in the second quarter of fiscal year 2017. continued future growth of our micra transcatheter pacing system , which we started shipping and physician training in the u.s. in the first quarter of fiscal year 2017. micra is a miniaturized single chamber pacemaker system that is delivered through the femoral vein and is implanted in the right ventricle of the heart . the system does not use a lead and does not have a subcutaneous device pocket underneath the skin as with conventional pacemaker systems . during the fourth quarter of fiscal year 2017 , we received final approval for reimbursement in the u.s. from the centers for medicare & medicaid services for this transformative therapy , which we expect will accelerate sales in the u.s. continued acceptance and future growth from care management services as post-acute care services become even more critical in bundled payment models for different interventions or therapies . continued acceptance and future growth from evolut r 34mm transcatheter aortic heart valve , our next-generation recapturable system with differentiated 16 french equivalent delivery system , which was launched in the u.s. in the third quarter of fiscal year 2017. acceptance and future growth from evolut pro transcatheter aortic valve system ( evolut pro ) , which provides control during deployment to assist with accurate positioning with the ability to recapture and reposition the valve . evolut pro received u.s. fda approval and launched in the fourth quarter of fiscal year 2017. evolut pro is expected to receive ce mark approval and launch in europe late summer 2017. acceptance and future growth from the market release of resolute onyx , which received u.s. fda approval early in the first quarter of fiscal year 2018 and is expected to receive approval in japan during the summer of fiscal year 2018. resolute onyx builds on the resolute integrity drug-eluting coronary stent with thinner struts to improve deliverability and is the first stent to feature our corewire technology , allowing greater visibility during procedures . continued acceptance and future growth of the in.pact admiral drug-coated balloon , including the longer length 150mm sizes , for the treatment of peripheral artery disease in the upper leg . continued acceptance and future growth from the hawkone 6 french ( 6f ) for treating patients with peripheral artery disease ( pad ) , which launched in the u.s. in the third quarter of fiscal year 2017. the hawkone system is designed to remove plaque from the vessel wall and restore blood flow . the new hawkone 6f provides an effective and easy-to-use treatment option for patients with pad both above and below the knee with a single device at a lower profile . minimally invasive therapies group the minimally invasive therapies group 's products span the entire continuum of care with a focus on diseases of

debt and capital our capital structure consists of equity and interest-bearing debt . we use a combination of bank borrowings and commercial paper issuances to fund our short-term financing needs . current debt , including the current portion of our long-term debt and capital lease obligations , at april 28 , 2017 was $ 7.5 billion compared to $ 993 million at april 29 , 2016 . we utilize senior notes to meet our long-term financing needs . long-term debt at april 28 , 2017 was $ 25.9 billion compared to $ 30.1 billion at april 29 , 2016 . total debt at april 28 , 2017 was $ 33.4 billion , compared to $ 31.1 billion at april 29 , 2016 . the increase in total debt was primarily driven by the issuance of three tranches of the 2017 senior notes with an aggregate face value of $ 2.0 billion in march 2017. we will use these funds for general corporate purposes . we maintain a commercial paper program for short-term financing , which allows us to issue unsecured commercial paper notes on a private placement basis up to a maximum aggregate amount outstanding at any time of $ 3.5 billion . at april 28 , 2017 , we had $ 901 million of commercial paper outstanding . no amount of commercial paper was outstanding under this program at april 29 , 2016 .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```debt and capital our capital structure consists of equity and interest-bearing debt . we use a combination of bank borrowings and commercial paper issuances to fund our short-term financing needs . current debt , including the current portion of our long-term debt and capital lease obligations , at april 28 , 2017 was $ 7.5 billion compared to $ 993 million at april 29 , 2016 . we utilize senior notes to meet our long-term financing needs . long-term debt at april 28 , 2017 was $ 25.9 billion compared to $ 30.1 billion at april 29 , 2016 . total debt at april 28 , 2017 was $ 33.4 billion , compared to $ 31.1 billion at april 29 , 2016 . the increase in total debt was primarily driven by the issuance of three tranches of the 2017 senior notes with an aggregate face value of $ 2.0 billion in march 2017. we will use these funds for general corporate purposes . we maintain a commercial paper program for short-term financing , which allows us to issue unsecured commercial paper notes on a private placement basis up to a maximum aggregate amount outstanding at any time of $ 3.5 billion . at april 28 , 2017 , we had $ 901 million of commercial paper outstanding . no amount of commercial paper was outstanding under this program at april 29 , 2016 . ``` Suspicious Activity Report : the gaap to non-gaap reconciliation presents non-gaap financial measures that exclude the impact of charges or gains that contribute to or reduce earnings and that may affect financial trends , but which include charges or benefits that result from transactions or events that management believes may or may not recur with similar materiality or impact to our operations in future periods ( non-gaap adjustments ) . in the event there is a non-gaap adjustment recognized in our operating results , the tax cost or benefit attributable to that item is separately calculated . because the effective rate may be significantly affected by the non-gaap adjustments that take place during the period , we often refer to our tax rate using both the effective rate and the non-gaap nominal tax rate ( non-gaap nominal tax rate ) . the non-gaap nominal tax rate is calculated as the provision for income taxes , adjusted for the impact of non-gaap adjustments , as a percentage of income from operations before income taxes , excluding non-gaap adjustments . 39 free cash flow is a non-gaap financial measure calculated by subtracting additions to property , plant , and equipment from net cash provided by operating activities . refer to the “ gaap to non-gaap reconciliation , `` `` income taxes , `` and `` summary of cash flows `` sections for reconciliations of our results of operations prepared in accordance with u.s. gaap to the adjusted non-gaap financial measures considered by management . executive level overview medtronic is among the world 's largest medical technology , services , and solutions companies - alleviating pain , restoring health , and extending life for millions of people around the world . we employ more than 91,000 full-time employees worldwide , serving physicians , hospitals , and patients in approximately 160 countries . our primary products include those for cardiac rhythm disorders , cardiovascular disease , advanced and general surgical care , respiratory and monitoring solutions , neurological disorders , spinal conditions and musculoskeletal trauma , urological and digestive disorders , and ear , nose , and throat and diabetes conditions . net income attributable to medtronic for fiscal year 2017 was $ 4.0 billion , $ 2.89 per diluted share , as compared to net income attributable to medtronic of $ 3.5 billion , $ 2.48 per diluted share , for fiscal year 2016 , representing an increase of 14 percent and 17 percent , respectively . the table below illustrates net sales by operating segment for fiscal years 2017 , 2016 , and 2015 : replace_table_token_6_th ( 1 ) the minimally invasive therapies group was a new group in the fourth quarter of fiscal year 2015 that contains the majority of covidien 's former operations . revenue growth is compared to a full year of operations in fiscal year 2016. currency translation had an unfavorable impact of $ 34 million on net sales for fiscal year 2017 , as compared to fiscal year 2016 when using the average exchange rates in effect during fiscal year 2016 . net sales growth for fiscal year 2017 was also unfavorably affected by an additional selling week during the first quarter of fiscal year 2016 , resulting from our 52/53 week fiscal year calendar . in addition , the fiscal year 2017 acquisitions of heartware and smith & nephew 's gynecology business contributed $ 200 million to our total net sales growth . our performance continues to be fueled by our three growth strategies : therapy innovation , globalization , and economic value . we are creating competitive advantages and capitalizing on the long-term trends in healthcare : namely , the desire to improve clinical outcomes ; the growing demand for expanded access to care ; and the optimization of cost and efficiency within healthcare systems . in our therapy innovation growth strategy , we continue to see strong adoption of our products across all our operating segments . further discussion about our products is included within the operating segment sections below . in globalization , net sales in emerging markets and non-u.s. developed markets grew 7 percent and 4 percent , respectively , in fiscal year 2017 compared to fiscal year 2016 . in our third growth strategy , economic value , we continue to execute our value-based healthcare signature programs and remain focused on leading the shift to healthcare payment systems that reward value and improved patient outcomes over volume . see our discussion in the “ net sales ” section of this management 's discussion and analysis for more information on the results of our operating segments . gaap to non-gaap reconciliation we have provided non-gaap financial measures , because we believe they provide meaningful information regarding our results on a consistent and comparable basis for the periods presented . management uses these non-gaap financial measures to facilitate its review of our operational performance and as a basis for strategic planning . management believes that non-gaap financial measures provide useful information to investors regarding the underlying business trends and performance of our ongoing operations and are useful for period over period comparisons of such operations . refer to our discussion in the `` costs and expenses `` and `` income taxes `` sections of this management 's discussion and analysis for more information on the non-gaap adjustments . investors should not consider results reflecting non-gaap financial measures in isolation from , or as a substitute for , financial information prepared in accordance with u.s. gaap , and should be cautioned that we may calculate results reflecting non-gaap financial measures in a manner that is different from other companies . 40 replace_table_token_7_th ( 1 ) the tax effect of each non-gaap adjustment is based on the jurisdictions in which the expense ( income ) is incurred and the tax laws in effect for each such jurisdiction . story_separator_special_tag coronary & structural heart net sales for fiscal year 2016 were $ 3.1 billion , an increase of 2 percent compared to fiscal year 2015. net sales were driven by the corevalve evolut r recapturable system in the u.s. , which was launched late in the first quarter of fiscal year 2016 , and a strong corevalve launch in japan in the fourth quarter of fiscal year 2016. in addition , net sales of coronary & structural heart division were driven by drug-eluting stents , including the resolute onyx drug-eluting stent in europe and the resolute integrity drug-eluting stent in the u.s. , and the recent launches of the nc euphora and sc euphora balloon dilatation catheters . net sales were partially offset by continued pricing pressures in our coronary business . aortic & peripheral vascular net sales for fiscal year 2016 were $ 1.6 billion , an increase of 52 percent compared to fiscal year 2015. the aortic & peripheral vascular division net sales performance benefited from the addition of the covidien peripheral business in the fourth quarter of fiscal year 2015. the increase in aortic & peripheral vascular net sales was driven by strong growth of the in.pact admiral drug-coated balloon in the u.s. and globally , continued strength in valiant captiva taa stent graft sales , continued solid adoption of our aptus heli-fx endoanchor , and continued adoption of the endurant iis abdominal aortic aneurysm ( aaa ) 3-piece system in the u.s. net sales for the aortic & peripheral vascular division were affected by increased competition in international markets and reimbursement cuts in japan . looking ahead , we expect our cardiac and vascular group could be affected by the following : changes in procedural volumes , competitive and pricing pressure , geographic macro-economic risks , reimbursement challenges , impacts from changes in the mix of our product offerings , the timing of product registration approvals , replacement cycle challenges , and fluctuations in currency exchange rates . integration of our acquisition of heartware , a leading innovator of the heartware ventricular assist system ( hvad system ) , to treat patients around the world suffering from advanced heart failure . the acquisition of heartware in august 2016 broadened the medtronic portfolio of therapies , diagnostic tools and services for patients suffering from heart failure and is part of our therapy innovation strategy to surround the physician with innovative products while focusing on patients and disease states . acceptance and future growth of the crt-p quadripolar pacing system , which received ce mark approval in february 2017 and launched in europe during the fourth quarter of fiscal year 2017. in the u.s. , we received fda approval in may 2017 , and launched in the first quarter of fiscal year 2018. acceptance and future growth of the claria mri crt-d system with effectivcrt diagnostic and effective crt during af algorithm , which launched in the u.s. late in the third quarter of fiscal year 2017 and is expected to launch in japan in fiscal year 2018 . 45 continued future growth from the reveal linq insertable cardiac monitor , which launched in japan in the second quarter of fiscal year 2017. continued future growth of our micra transcatheter pacing system , which we started shipping and physician training in the u.s. in the first quarter of fiscal year 2017. micra is a miniaturized single chamber pacemaker system that is delivered through the femoral vein and is implanted in the right ventricle of the heart . the system does not use a lead and does not have a subcutaneous device pocket underneath the skin as with conventional pacemaker systems . during the fourth quarter of fiscal year 2017 , we received final approval for reimbursement in the u.s. from the centers for medicare & medicaid services for this transformative therapy , which we expect will accelerate sales in the u.s. continued acceptance and future growth from care management services as post-acute care services become even more critical in bundled payment models for different interventions or therapies . continued acceptance and future growth from evolut r 34mm transcatheter aortic heart valve , our next-generation recapturable system with differentiated 16 french equivalent delivery system , which was launched in the u.s. in the third quarter of fiscal year 2017. acceptance and future growth from evolut pro transcatheter aortic valve system ( evolut pro ) , which provides control during deployment to assist with accurate positioning with the ability to recapture and reposition the valve . evolut pro received u.s. fda approval and launched in the fourth quarter of fiscal year 2017. evolut pro is expected to receive ce mark approval and launch in europe late summer 2017. acceptance and future growth from the market release of resolute onyx , which received u.s. fda approval early in the first quarter of fiscal year 2018 and is expected to receive approval in japan during the summer of fiscal year 2018. resolute onyx builds on the resolute integrity drug-eluting coronary stent with thinner struts to improve deliverability and is the first stent to feature our corewire technology , allowing greater visibility during procedures . continued acceptance and future growth of the in.pact admiral drug-coated balloon , including the longer length 150mm sizes , for the treatment of peripheral artery disease in the upper leg . continued acceptance and future growth from the hawkone 6 french ( 6f ) for treating patients with peripheral artery disease ( pad ) , which launched in the u.s. in the third quarter of fiscal year 2017. the hawkone system is designed to remove plaque from the vessel wall and restore blood flow . the new hawkone 6f provides an effective and easy-to-use treatment option for patients with pad both above and below the knee with a single device at a lower profile . minimally invasive therapies group the minimally invasive therapies group 's products span the entire continuum of care with a focus on diseases of

we believe that customer adoption of these new offerings will continue to grow as customers across a range of industries begin to take advantage of the scalable computing power and flexibility provided through these new services . our strategy is to lead the industries we serve to cloud-based technologies and business models . this entails both a technological shift and a business model shift . as part of the transition , we discontinued selling new perpetual licenses of most individual software products effective february 1 , 2016 , and discontinued selling new perpetual licenses of suites while introducing industry collections effective august 1 , 2016. industry collections allow access to a broad set of products and services that exceeds those previously available in suites - simplifying the customer ability to get access to a complete set of tools for their industry . we now offer subscriptions for individual products and industry collections , cloud service offerings , and flexible enterprise business agreements ( `` new model subscription offerings `` ) . these offerings are designed to give our customers more flexibility with how they use our products and service offerings and to attract a broader range of customers , such as project-based users and small businesses . with the discontinuation of the sale of most perpetual licenses , we have accelerated our transition away from selling a mix of perpetual licenses and term-based product subscriptions toward a single subscription model . as a result of this shift and various other factors described in note 13 , `` segments `` in the notes to our consolidated financial statements , we have 2017 form 10-k 36 reassessed the way we allocate resources and evaluate financial performance and now operate as a single operating segment . during the transition , revenue , margins , eps , deferred revenue and cash flow from operations have been and will be impacted as more revenue is recognized ratably rather than upfront and as new product subscription offerings generally have a lower initial purchase price . as we progress through the business model transition , reported revenue is less relevant to measure the success of the business as perpetual license sales have been discontinued in favor of subscription offerings , which have considerably lower upfront prices . annualized recurring revenue ( `` arr `` ) and growth of subscriptions better reflect business momentum and provide additional transparency into the transition . to further analyze progress , we disaggregate our growth in these metrics between the original maintenance model ( `` maintenance `` ) and the new model subscription offerings . maintenance subscriptions peaked in the fourth quarter of our fiscal 2016 , and we expect them to decline slowly over time . we sell our products and services globally , through a combination of indirect and direct channels . during the fiscal year ended january 31 , 2017 , 2016 , and 2015 , our indirect channels , which include value added resellers , direct market resellers , distributors , computer manufacturers , and other software developers , were responsible for 72 % , 79 % , and 83 % of our overall revenue , respectively . during the same periods , our direct channels , which include sales resources dedicated to selling in our largest accounts , our highly specialized products , and business transacted through our online autodesk branded store , were responsible for 28 % , 21 % , and 17 % of our overall revenue , respectively . we anticipate that our channel mix will continue to change , particularly as we scale our digitally transacted online autodesk branded store business and our largest accounts shift towards direct-only business models . importantly , we expect our indirect channel will continue to transact and support the majority of our revenue as we move beyond the business model transition . we employ a variety of incentive programs and promotions to align our direct and indirect channels with our business strategies . in addition , we have a worldwide user group organization and we have created online user communities dedicated to the exchange of information related to the use of our products . one of our key strategies is to maintain an open-architecture design of our software products to facilitate third-party development of complementary products and industry-specific software solutions . this approach enables customers and third parties to customize solutions for a wide variety of highly specific uses . we offer several programs that provide strategic investment funding , technological platforms , user communities , technical support , forums , and events to developers who develop add-on applications for our products . for example , we have established the autodesk spark program to support ideas that push the boundaries of 3d printing and nurture the companies that will advance innovations within 3d printing hardware and software . we have also created the autodesk forge program to support innovators that build solutions to facilitate the development of a single connected ecosystem for the future of how things are designed , made , and used . in addition to the competitive advantages afforded by our technology , our large global network of distributors , resellers , third-party developers , customers , educational institutions , educators , and students is a key competitive advantage . this network of partners and relationships provides us with a broad and deep reach into volume markets around the world . our distributor and reseller network is extensive and provides our customers with the resources to purchase , deploy , learn , and support our products quickly and easily . we have a significant number of registered third-party developers who create products that work well with our products and extend them for a variety of specialized applications . autodesk is committed to helping fuel a lifelong passion for design in students of all ages . we offer free educational subscriptions of autodesk software worldwide to students , educators , and educational institutions . story_separator_special_tag considering this negative evidence and the absence of sufficient positive objective evidence that we would generate sufficient taxable income in the u.s. to realize the deferred tax assets , we determined that it was more likely than not 2017 form 10-k 40 that the company would not realize u.s. federal and state deferred tax assets and recorded a valuation allowance on our federal and state deferred tax assets . we continue to have a full valuation allowance against our u.s. deferred tax assets in fiscal 2017 and increased the amount of the valuation allowance to include deferred tax assets generated in fiscal 2017 , including deferred tax assets that were established as a result of the adoption of asu 2016-9 in the second quarter of fiscal 2017. as we continually strive to optimize our overall business model , tax planning strategies may become feasible and prudent whereby management may determine that it is more likely than not that the federal and state deferred tax assets will be realized ; therefore , we will continue to evaluate the evidence around our ability to utilize our net deferred tax assets each quarter , both in the us and in foreign jurisdictions , based on all available evidence , both positive and negative . stock-based compensation . we measure stock-based compensation cost at the grant date fair value of the award , and recognize expense ratably over the requisite service period , which is generally the vesting period . we estimate the fair value of certain stock-based payment awards ( including grants of employee stock purchases related to the employee stock purchase plan ) using either the black-scholes-merton option-pricing model or a binomial-lattice model ( e.g . , monte carlo simulation model ) . to determine the grant-date fair value of our stock-based payment awards , we use a black-scholes model or the quoted stock price on the date of grant , unless the awards are subject to market conditions , in which case we use the monte carlo simulation model . the monte carlo simulation model utilizes multiple input variables to estimate the probability that market conditions will be achieved . these variables include our expected stock price volatility over the expected term of the award , actual and projected employee stock option exercise behaviors , the risk-free interest rate for the expected term of the award , and expected dividends . the variables used in these models are reviewed on a quarterly basis and adjusted , as needed . share-based compensation cost for restricted stock is measured on the closing fair market value of our common stock on the date of grant . the value of the portion of the award that is ultimately expected to vest is recognized as expense in our consolidated statements of operations . legal contingencies . as described in part i , item 3 , “ legal proceedings ” and part ii , item 8 , note 8 , “ commitments and contingencies , ” in the notes to consolidated financial statements , we are periodically involved in various legal claims and proceedings . we routinely review the status of each significant matter and assess our potential financial exposure . if the potential loss from any matter is considered probable and the amount can be reasonably estimated , we record a liability for the estimated loss . because of inherent uncertainties related to these legal matters , we base our loss accruals on the best information available at the time . as additional information becomes available , we reassess our potential liability and may revise our estimates . such revisions could have a material impact on future quarterly or annual results of operations . restructuring charges and other facility exit costs , net and accruals . in february 2016 , the board of directors approved a world-wide restructuring plan ( “ fiscal 2017 plan ” ) in order to re-balance staffing levels and reduce operating expenses to better align them with the evolving needs of the company 's business . the company 's restructuring plans include one–time termination benefits as well as certain contractual termination benefits . we record costs associated with exit activities related to restructuring plans in accordance with the asc topic 420 , exit or disposal obligations . liabilities for costs associated with an exit or disposal activity are recognized in the period in which the liability is incurred . the timing of associated cash payments is dependent upon the type of exit cost and may extend over a 12-month period . we record restructuring charge liabilities in “ other accrued liabilities , ” or `` other liabilities `` in the consolidated balance sheet . restructuring charges include employee termination costs , facility closure and relocation costs , and contract termination costs . one–time termination benefits are recognized as a liability at estimated fair value when the approved plan of termination has been communicated to employees , unless employees must provide future service , in which case the benefits are recognized ratably over the future service period . ongoing termination benefits arrangements are recognized as a liability at estimated fair value when the amount of such benefits becomes estimable and payment is probable . for the facility facility-related restructuring charges , we recognize upon exiting all or a portion of a leased facility and meeting cease-use and other requirements . the amount of restructuring charges is based on the fair value of the lease obligation for the abandoned space , which includes a sublease assumption that could be reasonably obtained . restructuring charges require significant estimates and assumptions , including sub-lease income and expenses for severance and other employee separation costs . our estimates involve a number of risks and uncertainties , some of which are beyond our control , including future real estate market conditions and our ability to successfully enter into subleases or termination agreements with terms as favorable as those assumed when arriving at our estimates . we monitor these

liquidity and capital resources 2017 form 10-k 58 our primary source of cash is from the sale and maintenance of our products . our primary use of cash is payment of our operating costs , which consist primarily of employee-related expenses , such as compensation and benefits , as well as general operating expenses for marketing , facilities and overhead costs . in addition to operating expenses , we also use cash to fund our stock repurchase program and invest in our growth initiatives , which include acquisitions of products , technology and businesses . see further discussion of these items below . at january 31 , 2017 , our principal sources of liquidity were cash , cash equivalents , and marketable securities totaling $ 2.2 billion and net accounts receivable of $ 452.3 million . net of our senior notes , we have cash , cash equivalents , and marketable securities totaling $ 0.7 billion at january 31 , 2017 . in june 2015 , we issued $ 450.0 million aggregate principal amount of 3.125 % notes due june 15 , 2020 and $ 300.0 million aggregate principal amount of 4.375 % notes due june 15 , 2025 . in december 2012 , we issued $ 400.0 million aggregate principal amount of 1.95 % notes due december 15 , 2017 and $ 350.0 million aggregate principal amount of 3.6 % notes due december 15 , 2022 ( all four series of notes collectively , the “ notes ” ) . as of march 21 , 2017 , we have $ 1.5 billion aggregate principal amount of notes outstanding . in addition , we have a line of credit facility that permits unsecured short-term borrowings of up to $ 400.0 million with a may 2020 maturity date . as a result of the business model transition , the leverage ratio requirement of the credit agreement was waived during the fourth quarter of fiscal 2017. autodesk is discussing amendments to the financial covenants in the credit agreement with the lenders and expects to conclude this process during the first quarter of fiscal 2018. as of march 21 , 2017 , we have no amounts outstanding under the credit facility .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```liquidity and capital resources 2017 form 10-k 58 our primary source of cash is from the sale and maintenance of our products . our primary use of cash is payment of our operating costs , which consist primarily of employee-related expenses , such as compensation and benefits , as well as general operating expenses for marketing , facilities and overhead costs . in addition to operating expenses , we also use cash to fund our stock repurchase program and invest in our growth initiatives , which include acquisitions of products , technology and businesses . see further discussion of these items below . at january 31 , 2017 , our principal sources of liquidity were cash , cash equivalents , and marketable securities totaling $ 2.2 billion and net accounts receivable of $ 452.3 million . net of our senior notes , we have cash , cash equivalents , and marketable securities totaling $ 0.7 billion at january 31 , 2017 . in june 2015 , we issued $ 450.0 million aggregate principal amount of 3.125 % notes due june 15 , 2020 and $ 300.0 million aggregate principal amount of 4.375 % notes due june 15 , 2025 . in december 2012 , we issued $ 400.0 million aggregate principal amount of 1.95 % notes due december 15 , 2017 and $ 350.0 million aggregate principal amount of 3.6 % notes due december 15 , 2022 ( all four series of notes collectively , the “ notes ” ) . as of march 21 , 2017 , we have $ 1.5 billion aggregate principal amount of notes outstanding . in addition , we have a line of credit facility that permits unsecured short-term borrowings of up to $ 400.0 million with a may 2020 maturity date . as a result of the business model transition , the leverage ratio requirement of the credit agreement was waived during the fourth quarter of fiscal 2017. autodesk is discussing amendments to the financial covenants in the credit agreement with the lenders and expects to conclude this process during the first quarter of fiscal 2018. as of march 21 , 2017 , we have no amounts outstanding under the credit facility . ``` Suspicious Activity Report : we believe that customer adoption of these new offerings will continue to grow as customers across a range of industries begin to take advantage of the scalable computing power and flexibility provided through these new services . our strategy is to lead the industries we serve to cloud-based technologies and business models . this entails both a technological shift and a business model shift . as part of the transition , we discontinued selling new perpetual licenses of most individual software products effective february 1 , 2016 , and discontinued selling new perpetual licenses of suites while introducing industry collections effective august 1 , 2016. industry collections allow access to a broad set of products and services that exceeds those previously available in suites - simplifying the customer ability to get access to a complete set of tools for their industry . we now offer subscriptions for individual products and industry collections , cloud service offerings , and flexible enterprise business agreements ( `` new model subscription offerings `` ) . these offerings are designed to give our customers more flexibility with how they use our products and service offerings and to attract a broader range of customers , such as project-based users and small businesses . with the discontinuation of the sale of most perpetual licenses , we have accelerated our transition away from selling a mix of perpetual licenses and term-based product subscriptions toward a single subscription model . as a result of this shift and various other factors described in note 13 , `` segments `` in the notes to our consolidated financial statements , we have 2017 form 10-k 36 reassessed the way we allocate resources and evaluate financial performance and now operate as a single operating segment . during the transition , revenue , margins , eps , deferred revenue and cash flow from operations have been and will be impacted as more revenue is recognized ratably rather than upfront and as new product subscription offerings generally have a lower initial purchase price . as we progress through the business model transition , reported revenue is less relevant to measure the success of the business as perpetual license sales have been discontinued in favor of subscription offerings , which have considerably lower upfront prices . annualized recurring revenue ( `` arr `` ) and growth of subscriptions better reflect business momentum and provide additional transparency into the transition . to further analyze progress , we disaggregate our growth in these metrics between the original maintenance model ( `` maintenance `` ) and the new model subscription offerings . maintenance subscriptions peaked in the fourth quarter of our fiscal 2016 , and we expect them to decline slowly over time . we sell our products and services globally , through a combination of indirect and direct channels . during the fiscal year ended january 31 , 2017 , 2016 , and 2015 , our indirect channels , which include value added resellers , direct market resellers , distributors , computer manufacturers , and other software developers , were responsible for 72 % , 79 % , and 83 % of our overall revenue , respectively . during the same periods , our direct channels , which include sales resources dedicated to selling in our largest accounts , our highly specialized products , and business transacted through our online autodesk branded store , were responsible for 28 % , 21 % , and 17 % of our overall revenue , respectively . we anticipate that our channel mix will continue to change , particularly as we scale our digitally transacted online autodesk branded store business and our largest accounts shift towards direct-only business models . importantly , we expect our indirect channel will continue to transact and support the majority of our revenue as we move beyond the business model transition . we employ a variety of incentive programs and promotions to align our direct and indirect channels with our business strategies . in addition , we have a worldwide user group organization and we have created online user communities dedicated to the exchange of information related to the use of our products . one of our key strategies is to maintain an open-architecture design of our software products to facilitate third-party development of complementary products and industry-specific software solutions . this approach enables customers and third parties to customize solutions for a wide variety of highly specific uses . we offer several programs that provide strategic investment funding , technological platforms , user communities , technical support , forums , and events to developers who develop add-on applications for our products . for example , we have established the autodesk spark program to support ideas that push the boundaries of 3d printing and nurture the companies that will advance innovations within 3d printing hardware and software . we have also created the autodesk forge program to support innovators that build solutions to facilitate the development of a single connected ecosystem for the future of how things are designed , made , and used . in addition to the competitive advantages afforded by our technology , our large global network of distributors , resellers , third-party developers , customers , educational institutions , educators , and students is a key competitive advantage . this network of partners and relationships provides us with a broad and deep reach into volume markets around the world . our distributor and reseller network is extensive and provides our customers with the resources to purchase , deploy , learn , and support our products quickly and easily . we have a significant number of registered third-party developers who create products that work well with our products and extend them for a variety of specialized applications . autodesk is committed to helping fuel a lifelong passion for design in students of all ages . we offer free educational subscriptions of autodesk software worldwide to students , educators , and educational institutions . story_separator_special_tag considering this negative evidence and the absence of sufficient positive objective evidence that we would generate sufficient taxable income in the u.s. to realize the deferred tax assets , we determined that it was more likely than not 2017 form 10-k 40 that the company would not realize u.s. federal and state deferred tax assets and recorded a valuation allowance on our federal and state deferred tax assets . we continue to have a full valuation allowance against our u.s. deferred tax assets in fiscal 2017 and increased the amount of the valuation allowance to include deferred tax assets generated in fiscal 2017 , including deferred tax assets that were established as a result of the adoption of asu 2016-9 in the second quarter of fiscal 2017. as we continually strive to optimize our overall business model , tax planning strategies may become feasible and prudent whereby management may determine that it is more likely than not that the federal and state deferred tax assets will be realized ; therefore , we will continue to evaluate the evidence around our ability to utilize our net deferred tax assets each quarter , both in the us and in foreign jurisdictions , based on all available evidence , both positive and negative . stock-based compensation . we measure stock-based compensation cost at the grant date fair value of the award , and recognize expense ratably over the requisite service period , which is generally the vesting period . we estimate the fair value of certain stock-based payment awards ( including grants of employee stock purchases related to the employee stock purchase plan ) using either the black-scholes-merton option-pricing model or a binomial-lattice model ( e.g . , monte carlo simulation model ) . to determine the grant-date fair value of our stock-based payment awards , we use a black-scholes model or the quoted stock price on the date of grant , unless the awards are subject to market conditions , in which case we use the monte carlo simulation model . the monte carlo simulation model utilizes multiple input variables to estimate the probability that market conditions will be achieved . these variables include our expected stock price volatility over the expected term of the award , actual and projected employee stock option exercise behaviors , the risk-free interest rate for the expected term of the award , and expected dividends . the variables used in these models are reviewed on a quarterly basis and adjusted , as needed . share-based compensation cost for restricted stock is measured on the closing fair market value of our common stock on the date of grant . the value of the portion of the award that is ultimately expected to vest is recognized as expense in our consolidated statements of operations . legal contingencies . as described in part i , item 3 , “ legal proceedings ” and part ii , item 8 , note 8 , “ commitments and contingencies , ” in the notes to consolidated financial statements , we are periodically involved in various legal claims and proceedings . we routinely review the status of each significant matter and assess our potential financial exposure . if the potential loss from any matter is considered probable and the amount can be reasonably estimated , we record a liability for the estimated loss . because of inherent uncertainties related to these legal matters , we base our loss accruals on the best information available at the time . as additional information becomes available , we reassess our potential liability and may revise our estimates . such revisions could have a material impact on future quarterly or annual results of operations . restructuring charges and other facility exit costs , net and accruals . in february 2016 , the board of directors approved a world-wide restructuring plan ( “ fiscal 2017 plan ” ) in order to re-balance staffing levels and reduce operating expenses to better align them with the evolving needs of the company 's business . the company 's restructuring plans include one–time termination benefits as well as certain contractual termination benefits . we record costs associated with exit activities related to restructuring plans in accordance with the asc topic 420 , exit or disposal obligations . liabilities for costs associated with an exit or disposal activity are recognized in the period in which the liability is incurred . the timing of associated cash payments is dependent upon the type of exit cost and may extend over a 12-month period . we record restructuring charge liabilities in “ other accrued liabilities , ” or `` other liabilities `` in the consolidated balance sheet . restructuring charges include employee termination costs , facility closure and relocation costs , and contract termination costs . one–time termination benefits are recognized as a liability at estimated fair value when the approved plan of termination has been communicated to employees , unless employees must provide future service , in which case the benefits are recognized ratably over the future service period . ongoing termination benefits arrangements are recognized as a liability at estimated fair value when the amount of such benefits becomes estimable and payment is probable . for the facility facility-related restructuring charges , we recognize upon exiting all or a portion of a leased facility and meeting cease-use and other requirements . the amount of restructuring charges is based on the fair value of the lease obligation for the abandoned space , which includes a sublease assumption that could be reasonably obtained . restructuring charges require significant estimates and assumptions , including sub-lease income and expenses for severance and other employee separation costs . our estimates involve a number of risks and uncertainties , some of which are beyond our control , including future real estate market conditions and our ability to successfully enter into subleases or termination agreements with terms as favorable as those assumed when arriving at our estimates . we monitor these

the typical investments made by us during 2014 and 2015 were to reputable owners or acquirers , and at leverage levels which are senior to sizable equity investments by the sponsors . during 2015 , our debt and preferred equity activities included purchases and originations , inclusive of advances under 40 future funding obligations , discount and fee amortization , and paid-in-kind interest , net of premium amortization , of $ 781.4 million , and sales , redemption and participations of $ 520.2 million . for descriptions of significant activities in 2015 , refer to `` part i , item 1. business - highlights from 2015 `` . critical accounting policies our discussion and analysis of financial condition and results of operations is based on our consolidated financial statements , which have been prepared in accordance with accounting principles generally accepted in the united states . the preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets , liabilities , and contingencies as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods . we evaluate our assumptions and estimates on an ongoing basis . we base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances , the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources . actual results may differ from these estimates under different assumptions or conditions . we believe the following critical accounting policies affect our more significant judgments and estimates used in the preparation of our consolidated financial statements . investment in commercial real estate properties on a periodic basis , we assess whether there are any indications that the value of our real estate properties may be impaired or that their carrying value may not be recoverable . a property 's value is considered impaired if management 's estimate of the aggregate future cash flows ( undiscounted and without interest charges for consolidated properties ) to be generated by the property is less than the carrying value of the property . to the extent impairment has occurred , the loss will be measured as the excess of the carrying amount of the property over the calculated fair value of the property . we also evaluate our real estate properties for potential impairment when a real estate property has been classified as held for sale . real estate assets held for sale are valued at the lower of either their carrying value or fair value less costs to sell . except as discussed below , we do not believe that there were any indicators of impairment at any of our consolidated properties at december 31 , 2015 . during the three months ended september 30 , 2015 , we recorded a $ 19.2 million charge in connection with the sale of two of our properties , which closed in the fourth quarter of 2015. this charge is included in depreciable real estate reserves in the consolidated statements of operations . prior to the quarter ended september 30 , 2015 , we do not believe that there were any indicators of impairment at these two properties . see note 4 , `` properties held for sale and property dispositions . `` during the fourth quarter of 2015 , we entered into an agreement to sell 885 third avenue and recorded a $ 6.6 million charge which was included in gain on sale of real estate , net in the consolidated statement of operations . as of december 31 , 2015 , 885 third avenue was not reclassified as held for sale as a result of not meeting the criteria in asc 360-10 , property , plant and equipment - impairment and disposal of long-lived assets . in february 2016 , we closed on the sale of this property but do not anticipate meeting the criteria for the full accrual method in asc 360-20 , property , plant and equipment - real estate sales and as a result the property will remain on our consolidated balance sheet until the criteria is met . we incur a variety of costs in the development and leasing of our properties . after determination is made to capitalize a cost , it is allocated to the specific component of a project that is benefited . determination of when a development project is substantially complete and capitalization must cease involves a degree of judgment . the costs of land and building under development include specifically identifiable costs . the capitalized costs include , but are not limited to , pre-construction costs essential to the development of the property , development costs , construction costs , interest costs , real estate taxes , salaries and related costs and other costs incurred during the period of development . we consider a construction project as substantially completed and held available for occupancy upon the completion of tenant improvements , but no later than one year from cessation of major construction activity . we cease capitalization on the portions substantially completed and occupied or held available for occupancy , and capitalize only those costs associated with the portions under construction . we recognize the assets acquired , liabilities assumed ( including contingencies ) and any noncontrolling interests in an acquired entity at their fair values on the acquisition date . we expense acquisition-related transaction costs as incurred , which are included in transaction related costs on our consolidated statements of operations . when we acquire our partner 's equity interest in an existing unconsolidated joint venture and gain control over the investment , we record the consolidated investment at fair value . story_separator_special_tag based on our estimates at december 31 , 2015 , the current market asking rents on these expected 2016 lease expirations at our consolidated suburban operating properties are 8.7 % higher than the existing in-place fully escalated rents while the current market asking rents on all of our consolidated suburban operating properties are 7.4 % higher than the existing in-place fully escalated rents on leases that are scheduled to expire in all future years . 47 investment income investment income increased primarily as a result of higher average investment balances for the year ended december 31 , 2015. for the twelve months ended december 31 , 2015 , the weighted average debt and preferred equity investment balance outstanding and weighted average yield were $ 1.7 billion and 10.3 % , respectively , compared to $ 1.4 billion and 10.5 % , respectively , for the same period in 2014. in addition , we recognized additional income as a result of the early repayment of certain mortgage and mezzanine positions ( $ 2.5 million ) and the sale of a junior mortgage position ( $ 1.2 million ) . this increase was partially offset by additional income recognized in 2014 on a mezzanine investment for which the underlying property was sold in june 2014 ( $ 10.1 million ) and a financing receivable on which we began accruing interest following the completion of the development of the underlying property ( $ 5.3 million ) . as of december 31 , 2015 , the debt and preferred equity investments had a weighted average term to maturity of 1.7 years as compared to a weighted average term to maturity of 2.0 years as of december 31 , 2014. other income other income increased primarily as a result of lease termination income earned at our same-store properties ( $ 20.2 million ) , which included 919 third avenue ( $ 12.5 million ) , a non-recurring fee related to the settlement of a previous investment ( $ 6.5 million ) , a tax benefit related to our taxable reit subsidiary ( $ 5.3 million ) , a non-recurring fee received from a current tenant ( $ 3.5 million ) , and a bankruptcy settlement received from a former tenant ( $ 2.7 million ) . this increase was partially offset by promote income earned in 2014 in connection with the sale of our joint venture interest in 747 madison avenue and 180 broadway in 2014 ( $ 13.6 million ) , incentive income received from a joint venture investment in 2014 ( $ 7.6 million ) , lower contributions from service corporation ( $ 8.0 million ) and a one-time fee earned in connection with the restructuring of one of our debt investments in 2014 ( $ 5.7 million ) . property operating expenses property operating expenses increased primarily as a result of higher operating expenses at the same-store properties ( $ 28.3 million ) and properties recently acquired ( $ 14.4 million ) , partially offset by a decrease from vacating the properties that comprise the one vanderbilt development site ( $ 9.0 million ) . the increase in property operating expenses at the same-store properties was primarily attributable to higher real estate taxes ( $ 15.7 million ) , repairs and maintenance ( $ 12.0 million ) and professional fees ( $ 2.2 million ) . marketing , general and administrative expenses marketing , general and administrative expenses for the year ended december 31 , 2015 were $ 94.9 million , or 5.0 % of total combined revenues , including our share of joint venture revenues , and 44 basis points of total combined assets , including our share of joint venture assets compared to $ 92.5 million , or 5.3 % of total revenues including our share of joint venture revenues , and 49 basis points of total assets including our share of joint venture assets for 2014. interest expense and amortization of deferred financing costs , net of interest income interest expense and amortization of deferred financing costs , net of interest income , increased primarily as a result of the acquisition of our joint venture partner 's interest in may 2014 and a new mortgage at 388-390 greenwich street ( $ 16.4 million ) , increased borrowings on the 2012 credit facility ( $ 10.9 million ) , and a new mortgage related to the acquisition of 11 madison avenue ( $ 12.8 million ) . these increases were partially offset the repayment of the mortgages at 625 madison avenue ( $ 8.4 million ) and 125 park avenue ( $ 4.3 million ) during the fourth quarter of 2014 and 711 third ( $ 4.8 million ) during the first quarter of 2015 , the capitalization of interest relating to properties under development ( $ 4.4 million ) , the redemption of a preferred equity investment which secured a loan ( $ 3.1 million ) during the fourth quarter of 2014 , and the repayment of 5.875 % senior notes issued by rop in august 2014 ( $ 2.8 million ) at their maturity . the weighted average consolidated debt balance outstanding increased to $ 9.2 billion for the year ended december 31 , 2015 from $ 8.7 billion for the year ended december 31 , 2014. the weighted average interest rate decreased to 3.78 % for the year ended december 31 , 2015 from 4.24 % for the year ended december 31 , 2014. depreciation and amortization depreciation and amortization increased primarily as a result of accelerated depreciation expense related to vacating the properties that comprise the one vanderbilt development site ( $ 138.1 million ) , the consolidation of 388-390 greenwich street in 2014 ( $ 31.2 million ) , and the acquisition of 11 madison in august 2015 ( $ 11.1 million ) , partially offset by the write-off of certain tenant improvements and value for in-place leases associated with a former tenant in 2014

loss on early extinguishment of debt loss on early extinguishment of debt for the year ended december 31 , 2014 was primarily attributable to the refinancing of the mortgage at 420 lexington avenue ( $ 24.5 million ) and the early repayment of the mortgage at 625 madison avenue ( $ 6.9 million ) . discontinued operations discontinued operations for the year ended december 31 , 2015 included the gain recognized on the sale of 180 maiden lane ( $ 17.0 million ) and the related results of operations . discontinued operations for the year ended december 31 , 2014 included the gains recognized on the sale of 673 first avenue ( $ 117.6 million ) , 985-987 third avenue ( $ 29.8 million ) , and 2 herald square ( $ 18.8 million ) , and the results of operations of these properties and other properties that were held for sale or sold as of december 31 , 2014 . 49 comparison of the year ended december 31 , 2014 to the year ended december 31 , 2013 the following comparison for the year ended december 31 , 2014 , or 2014 , to the year ended december 31 , 2013 , or 2013 , makes reference to the following : ( i ) the effect of the “ same-store properties , ” which represents all operating properties owned by us at january 1 , 2013 and still owned by us at december 31 , 2014 and

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```loss on early extinguishment of debt loss on early extinguishment of debt for the year ended december 31 , 2014 was primarily attributable to the refinancing of the mortgage at 420 lexington avenue ( $ 24.5 million ) and the early repayment of the mortgage at 625 madison avenue ( $ 6.9 million ) . discontinued operations discontinued operations for the year ended december 31 , 2015 included the gain recognized on the sale of 180 maiden lane ( $ 17.0 million ) and the related results of operations . discontinued operations for the year ended december 31 , 2014 included the gains recognized on the sale of 673 first avenue ( $ 117.6 million ) , 985-987 third avenue ( $ 29.8 million ) , and 2 herald square ( $ 18.8 million ) , and the results of operations of these properties and other properties that were held for sale or sold as of december 31 , 2014 . 49 comparison of the year ended december 31 , 2014 to the year ended december 31 , 2013 the following comparison for the year ended december 31 , 2014 , or 2014 , to the year ended december 31 , 2013 , or 2013 , makes reference to the following : ( i ) the effect of the “ same-store properties , ” which represents all operating properties owned by us at january 1 , 2013 and still owned by us at december 31 , 2014 and ``` Suspicious Activity Report : the typical investments made by us during 2014 and 2015 were to reputable owners or acquirers , and at leverage levels which are senior to sizable equity investments by the sponsors . during 2015 , our debt and preferred equity activities included purchases and originations , inclusive of advances under 40 future funding obligations , discount and fee amortization , and paid-in-kind interest , net of premium amortization , of $ 781.4 million , and sales , redemption and participations of $ 520.2 million . for descriptions of significant activities in 2015 , refer to `` part i , item 1. business - highlights from 2015 `` . critical accounting policies our discussion and analysis of financial condition and results of operations is based on our consolidated financial statements , which have been prepared in accordance with accounting principles generally accepted in the united states . the preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets , liabilities , and contingencies as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods . we evaluate our assumptions and estimates on an ongoing basis . we base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances , the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources . actual results may differ from these estimates under different assumptions or conditions . we believe the following critical accounting policies affect our more significant judgments and estimates used in the preparation of our consolidated financial statements . investment in commercial real estate properties on a periodic basis , we assess whether there are any indications that the value of our real estate properties may be impaired or that their carrying value may not be recoverable . a property 's value is considered impaired if management 's estimate of the aggregate future cash flows ( undiscounted and without interest charges for consolidated properties ) to be generated by the property is less than the carrying value of the property . to the extent impairment has occurred , the loss will be measured as the excess of the carrying amount of the property over the calculated fair value of the property . we also evaluate our real estate properties for potential impairment when a real estate property has been classified as held for sale . real estate assets held for sale are valued at the lower of either their carrying value or fair value less costs to sell . except as discussed below , we do not believe that there were any indicators of impairment at any of our consolidated properties at december 31 , 2015 . during the three months ended september 30 , 2015 , we recorded a $ 19.2 million charge in connection with the sale of two of our properties , which closed in the fourth quarter of 2015. this charge is included in depreciable real estate reserves in the consolidated statements of operations . prior to the quarter ended september 30 , 2015 , we do not believe that there were any indicators of impairment at these two properties . see note 4 , `` properties held for sale and property dispositions . `` during the fourth quarter of 2015 , we entered into an agreement to sell 885 third avenue and recorded a $ 6.6 million charge which was included in gain on sale of real estate , net in the consolidated statement of operations . as of december 31 , 2015 , 885 third avenue was not reclassified as held for sale as a result of not meeting the criteria in asc 360-10 , property , plant and equipment - impairment and disposal of long-lived assets . in february 2016 , we closed on the sale of this property but do not anticipate meeting the criteria for the full accrual method in asc 360-20 , property , plant and equipment - real estate sales and as a result the property will remain on our consolidated balance sheet until the criteria is met . we incur a variety of costs in the development and leasing of our properties . after determination is made to capitalize a cost , it is allocated to the specific component of a project that is benefited . determination of when a development project is substantially complete and capitalization must cease involves a degree of judgment . the costs of land and building under development include specifically identifiable costs . the capitalized costs include , but are not limited to , pre-construction costs essential to the development of the property , development costs , construction costs , interest costs , real estate taxes , salaries and related costs and other costs incurred during the period of development . we consider a construction project as substantially completed and held available for occupancy upon the completion of tenant improvements , but no later than one year from cessation of major construction activity . we cease capitalization on the portions substantially completed and occupied or held available for occupancy , and capitalize only those costs associated with the portions under construction . we recognize the assets acquired , liabilities assumed ( including contingencies ) and any noncontrolling interests in an acquired entity at their fair values on the acquisition date . we expense acquisition-related transaction costs as incurred , which are included in transaction related costs on our consolidated statements of operations . when we acquire our partner 's equity interest in an existing unconsolidated joint venture and gain control over the investment , we record the consolidated investment at fair value . story_separator_special_tag based on our estimates at december 31 , 2015 , the current market asking rents on these expected 2016 lease expirations at our consolidated suburban operating properties are 8.7 % higher than the existing in-place fully escalated rents while the current market asking rents on all of our consolidated suburban operating properties are 7.4 % higher than the existing in-place fully escalated rents on leases that are scheduled to expire in all future years . 47 investment income investment income increased primarily as a result of higher average investment balances for the year ended december 31 , 2015. for the twelve months ended december 31 , 2015 , the weighted average debt and preferred equity investment balance outstanding and weighted average yield were $ 1.7 billion and 10.3 % , respectively , compared to $ 1.4 billion and 10.5 % , respectively , for the same period in 2014. in addition , we recognized additional income as a result of the early repayment of certain mortgage and mezzanine positions ( $ 2.5 million ) and the sale of a junior mortgage position ( $ 1.2 million ) . this increase was partially offset by additional income recognized in 2014 on a mezzanine investment for which the underlying property was sold in june 2014 ( $ 10.1 million ) and a financing receivable on which we began accruing interest following the completion of the development of the underlying property ( $ 5.3 million ) . as of december 31 , 2015 , the debt and preferred equity investments had a weighted average term to maturity of 1.7 years as compared to a weighted average term to maturity of 2.0 years as of december 31 , 2014. other income other income increased primarily as a result of lease termination income earned at our same-store properties ( $ 20.2 million ) , which included 919 third avenue ( $ 12.5 million ) , a non-recurring fee related to the settlement of a previous investment ( $ 6.5 million ) , a tax benefit related to our taxable reit subsidiary ( $ 5.3 million ) , a non-recurring fee received from a current tenant ( $ 3.5 million ) , and a bankruptcy settlement received from a former tenant ( $ 2.7 million ) . this increase was partially offset by promote income earned in 2014 in connection with the sale of our joint venture interest in 747 madison avenue and 180 broadway in 2014 ( $ 13.6 million ) , incentive income received from a joint venture investment in 2014 ( $ 7.6 million ) , lower contributions from service corporation ( $ 8.0 million ) and a one-time fee earned in connection with the restructuring of one of our debt investments in 2014 ( $ 5.7 million ) . property operating expenses property operating expenses increased primarily as a result of higher operating expenses at the same-store properties ( $ 28.3 million ) and properties recently acquired ( $ 14.4 million ) , partially offset by a decrease from vacating the properties that comprise the one vanderbilt development site ( $ 9.0 million ) . the increase in property operating expenses at the same-store properties was primarily attributable to higher real estate taxes ( $ 15.7 million ) , repairs and maintenance ( $ 12.0 million ) and professional fees ( $ 2.2 million ) . marketing , general and administrative expenses marketing , general and administrative expenses for the year ended december 31 , 2015 were $ 94.9 million , or 5.0 % of total combined revenues , including our share of joint venture revenues , and 44 basis points of total combined assets , including our share of joint venture assets compared to $ 92.5 million , or 5.3 % of total revenues including our share of joint venture revenues , and 49 basis points of total assets including our share of joint venture assets for 2014. interest expense and amortization of deferred financing costs , net of interest income interest expense and amortization of deferred financing costs , net of interest income , increased primarily as a result of the acquisition of our joint venture partner 's interest in may 2014 and a new mortgage at 388-390 greenwich street ( $ 16.4 million ) , increased borrowings on the 2012 credit facility ( $ 10.9 million ) , and a new mortgage related to the acquisition of 11 madison avenue ( $ 12.8 million ) . these increases were partially offset the repayment of the mortgages at 625 madison avenue ( $ 8.4 million ) and 125 park avenue ( $ 4.3 million ) during the fourth quarter of 2014 and 711 third ( $ 4.8 million ) during the first quarter of 2015 , the capitalization of interest relating to properties under development ( $ 4.4 million ) , the redemption of a preferred equity investment which secured a loan ( $ 3.1 million ) during the fourth quarter of 2014 , and the repayment of 5.875 % senior notes issued by rop in august 2014 ( $ 2.8 million ) at their maturity . the weighted average consolidated debt balance outstanding increased to $ 9.2 billion for the year ended december 31 , 2015 from $ 8.7 billion for the year ended december 31 , 2014. the weighted average interest rate decreased to 3.78 % for the year ended december 31 , 2015 from 4.24 % for the year ended december 31 , 2014. depreciation and amortization depreciation and amortization increased primarily as a result of accelerated depreciation expense related to vacating the properties that comprise the one vanderbilt development site ( $ 138.1 million ) , the consolidation of 388-390 greenwich street in 2014 ( $ 31.2 million ) , and the acquisition of 11 madison in august 2015 ( $ 11.1 million ) , partially offset by the write-off of certain tenant improvements and value for in-place leases associated with a former tenant in 2014

e & p spending is expected to increase over the near-term as crude oil prices are forecasted to remain more stable . in 2018 , mexico 's new president has announced that the mexican government will not offer any new license rounds for the next three years while assuring that existing contracts will not be cancelled . in the medium-term , global crude oil demand is expected to continue growing while the oil & gas industry is predicted to face a supply crunch due to unsustainably low levels of exploration investments . as a result , e & p companies are expected to increase their focus on offshore oil exploration to replenish reserves . given the historical volatility of crude prices , there is a continued risk that if prices do not continue to improve , or if they start to decline again due to high levels of crude oil production , there is a potential for slowing growth rates in various global regions and or for ongoing supply/demand imbalances . if commodity prices do not continue to improve , or if they start to deteriorate again , demand for our services and products could decline . impact to our business while our 2018 revenues were down compared to 2017 , we are seeing signs of increasing activity in our business , primarily due to the strategic shift we made to move our offerings closer to the reservoir and the associated continued success of our 3-d multi-client programs as well as clients starting to renew interest in conventional reserve replacement and offshore exploration . historically , our revenue and ebitda generation is lower in the first part of the year as customers tend to set budgets in the first quarter , firm up plans through the year , and spend excess budget in the fourth quarter . investments in our multi-client data library are dependent upon the timing of our new venture projects and the availability of underwriting by our customers . we continue to maintain high standards for underwriting new projects . our asset light strategy enables us to scale our business to market conditions avoiding significant fixed costs and maintaining flexibility to manage the timing and amount of our capital expenditures . in our e & p technology & services segment , our new venture revenues experienced significant declines compared to 2017. in the current disciplined spending environment , many clients wait to purchase data associated with a license round until a formal public announcement has been made by the government . delays in license round announcements can materially impact the timing of sales in areas where our new venture programs are underway . our under performance was driven by the continued delay of the panama license round announcement , the three-year moratorium on new upstream licensing in mexico and the continued focus on cash preservation within e & p companies restricting exploration spending . imaging services revenues increased as a result of an increase in proprietary ocean bottom nodal imaging projects . our data library sales increased in 2018 compared to 2017 due to sales of the recently completed phase of the mexico and brazil reimaging programs , along with sales of 2-d data libraries in libya . we invested $ 28.3 million in our multi-client data library during 2018 , approximately $ 4.6 million and $ 13.4 million more compared to 2017 and 2016 , respectively . at december 31 , 2018 , our e & p technology & services segment backlog , which consists of commitments for ( i ) data processing work , ( ii ) new venture projects ( both multi-client and proprietary ) by our ventures group underwritten by our customers and ( iii ) e & p advisors projects , decreased 44 % to $ 21.9 million , compared with $ 39.2 million at december 31 , 2017 . the majority of our backlog relates to our 3-d multi-client reimaging programs offshore brazil and our proprietary imaging services and e & p advisors work . we anticipate that the majority of our backlog will be recognized as revenue over the first half of 2019. within the operations optimization segment , the increase in optimization software & services revenues was due to continued increase in sales of our gator ocean bottom command and control system . devices revenues continue to be impacted by reduced towed streamer seismic contractor activity and cash preservation focus . we have continued to evolve our strategy for our ocean bottom integrated technologies segment consistent with our asset light business model . the remaining elements of our next generation ocean bottom nodal system , 4sea , will be commercialized in 2019. we are offering 4sea components more broadly to the growing number of obs service providers under recurring revenue commercial strategies that will enable us to share in the value our technology delivers . we may also license the right to manufacture and use the fully integrated system to a service provider on a value-based pricing model , such as a royalty stream . such licensing would be recognized through the relevant segment , either e & p technology & services or operations optimization . while not our primary route to market , we continue to evaluate acquisition projects on a case-by-case basis that meet our long-term risk and return thresholds . in 2018 , we recognized a write down of $ 36.6 million for our cable-based ocean bottom acquisition technologies . we continue to see significant long-term potential for our technologies to improve obs safety , efficiency and data quality , and we expect demand for obs surveys to continue increasing . 35 it is our view that technologies that add a competitive advantage through improved imaging , lower costs , higher productivity , or enhanced safety will continue to be valued in our marketplace . story_separator_special_tag million of available borrowing capacity under the credit facility . our cash requirements include working capital requirements and cash required for our debt service payments , multi-client seismic data acquisition activities and capital expenditures . as of december 31 , 2018 , we had working capital of $ 20.1 million . working capital requirements are primarily driven by our investment in our ( i ) multi-client data library ( $ 28.3 million in 2018 ) and royalty payments for multi-client sales . also , our headcount has traditionally been a significant driver of our working capital needs . as a significant portion of our business is involved in the planning , processing and interpretation of seismic data , one of our largest investments is in our employees , which involves cash expenditures for their salaries , bonuses , payroll taxes and related compensation expenses , typically in advance of related revenue billings and collections . our working capital requirements may change from time to time depending upon many factors , including our operating results and adjustments in our operating plan in response to industry conditions , competition and unexpected events . in recent years , our primary sources of funds have been cash flows generated from operations , existing cash balances , debt and equity issuances and borrowings under our revolving credit facility . 42 public equity offering and retirement of debt on february 21 , 2018 , we announced our successful completion of a public equity offering to begin de-levering our balance sheet . we issued and sold 1,820,000 shares of common stock at a public offering price of $ 27.50 per share , and warrants to purchase an additional 1,820,000 shares of our common stock . the net proceeds from this offering were $ 47.0 million , including transaction expenses . a portion of the net proceeds were used to retire our $ 28.5 million third lien notes in march 2018 ( several weeks before their maturity date ) . the warrants have an exercise price of $ 33.60 per share , are immediately exercisable and expire on march 21 , 2019. equity investment program to encourage our executive officers and other key employees to purchase our common stock and further align their interests with those of our stockholders , the board authorized and approved an equity investment program pursuant to which certain of our executive officers and other key employees are permitted , but not obligated , to purchase unregistered shares of our common stock directly from the company at market prices . in connection with any such purchases , the committee authorized and approved , on december 13 , 2017 , a grant by us to such purchasing executive officers and key employees of a certain number of shares of restricted stock . on december 13 , 2017 , the committee also authorized and approved to grant to certain executive officers and key employees a certain number of shares of restricted stock in connection with certain purchases of shares of our common stock in the open market . on december 14 , 2017 , we sold , in a private placement under section 4 ( a ) ( 2 ) of the securities act of 1933 , as amended , 120,567 shares of our common stock at $ 13.05 per share ( the closing price of the our common stock on the nyse on such date ) and executive officers and other key employees purchased 219,346 shares in the open market . revolving credit facility on august 16 , 2018 , we and our material u.s. subsidiaries ; gx technology corporation , ion exploration products ( u.s.a ) and i/o marine systems , inc. ( the “ material u.s. subsidiaries ” ) , along with gx geoscience corporation , s. de r.l . de c.v. , a limited liability company ( sociedad de responsibilidad limitada de capital variable ) organized under the laws of mexico , and a subsidiary of the company ( the “ mexican subsidiary , ” ) ( the material u.s. subsidiaries and the mexican subsidiary are collectively , the “ subsidiary borrowers ” , together with ion geophysical corporation are the “ borrowers ” ) , the financial institutions party thereto , as lenders , and pnc bank , national association ( “ pnc ” ) , as agent for the lenders , entered into that certain third amendment and joinder to revolving credit and security agreement ( the “ third amendment ” ) , amending the revolving credit and security agreement , dated as of august 22 , 2014 ( as previously amended by the first amendment to revolving credit and security agreement , dated as of august 4 , 2015 and the second amendment to revolving credit and security agreement , dated as of april 28 , 2016 , the “ credit agreement ” ) . the credit agreement , as amended by the first amendment , the second amendment and the third amendment is herein called , the “ credit facility ” ) . the third amendment amends the credit agreement to , among other things : extend the maturity date of the credit facility by approximately four years ( from august 22 , 2019 to august 16 , 2023 ) , subject to the retirement or extension of the maturity date of the second lien notes , as defined below , which mature on december 15 , 2021 ; increase the maximum revolver amount by $ 10 million ( from $ 40 million to $ 50 million ) ; increase the borrowing base percentage of the net orderly liquidation value as it relates to the multi-client data library ( not to exceed $ 28.5 million , up from the previous maximum of $ 15 million for the multi-client data library component ) ; include the eligible billed receivables of the mexican subsidiary up to a maximum of $ 5 million in the borrowing base calculation and joins the

net cash provided by operating activities was $ 7.1 million for 2018 , compared to $ 27.6 million for 2017 . the decrease was driven by lower revenue activity compared to 2017 , payment of $ 3.75 million damages payment for the westerngeco lawsuit , reductions in accounts payable and accrued expenses and increase in our combined accounts and unbilled receivable balance . net cash provided by operating activities was $ 27.6 million for 2017 , compared to $ 1.0 million for 2016. the increase in net cash provided by operations was due to a significant increase in new venture revenues in 2017 , compared to 2016 and due to $ 20.8 million damages payment in 2016 for the westerngeco lawsuit , which was partially offset by increases in unbilled receivables as of december 31 , 2017. cash flow used in investing activities net cash flow used in investing activities was $ 29.8 million for 2018 , compared to $ 24.8 million for 2017 . the principal uses of cash in our investing activities during 2018 were $ 28.3 million of investments in our multi-client data library and $ 1.5 million of investments in property , plant and equipment . net cash flow used in investing activities was $ 24.8 million for 2017 , compared to $ 13.6 million for 2016. the principal uses of cash in our investing activities during 2017 were $ 23.7 million of investments in our multi-client data library and $ 1.1 million of investments in property , plant and equipment . cash flow used in financing activities net cash flow provided by financing activities was $ 3.8 million for 2018 , compared to $ 3.6 million of net cash flow used in financing activities for 2017 . the net cash flow provided by financing activities during 2018 was primarily related to $ 47.0 million of net cash received from our public equity offering , partially offset by $ 30.8 million of payments on long-term debt including equipment capital leases and a $ 10.0 million repayment of our credit facility .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```net cash provided by operating activities was $ 7.1 million for 2018 , compared to $ 27.6 million for 2017 . the decrease was driven by lower revenue activity compared to 2017 , payment of $ 3.75 million damages payment for the westerngeco lawsuit , reductions in accounts payable and accrued expenses and increase in our combined accounts and unbilled receivable balance . net cash provided by operating activities was $ 27.6 million for 2017 , compared to $ 1.0 million for 2016. the increase in net cash provided by operations was due to a significant increase in new venture revenues in 2017 , compared to 2016 and due to $ 20.8 million damages payment in 2016 for the westerngeco lawsuit , which was partially offset by increases in unbilled receivables as of december 31 , 2017. cash flow used in investing activities net cash flow used in investing activities was $ 29.8 million for 2018 , compared to $ 24.8 million for 2017 . the principal uses of cash in our investing activities during 2018 were $ 28.3 million of investments in our multi-client data library and $ 1.5 million of investments in property , plant and equipment . net cash flow used in investing activities was $ 24.8 million for 2017 , compared to $ 13.6 million for 2016. the principal uses of cash in our investing activities during 2017 were $ 23.7 million of investments in our multi-client data library and $ 1.1 million of investments in property , plant and equipment . cash flow used in financing activities net cash flow provided by financing activities was $ 3.8 million for 2018 , compared to $ 3.6 million of net cash flow used in financing activities for 2017 . the net cash flow provided by financing activities during 2018 was primarily related to $ 47.0 million of net cash received from our public equity offering , partially offset by $ 30.8 million of payments on long-term debt including equipment capital leases and a $ 10.0 million repayment of our credit facility . ``` Suspicious Activity Report : e & p spending is expected to increase over the near-term as crude oil prices are forecasted to remain more stable . in 2018 , mexico 's new president has announced that the mexican government will not offer any new license rounds for the next three years while assuring that existing contracts will not be cancelled . in the medium-term , global crude oil demand is expected to continue growing while the oil & gas industry is predicted to face a supply crunch due to unsustainably low levels of exploration investments . as a result , e & p companies are expected to increase their focus on offshore oil exploration to replenish reserves . given the historical volatility of crude prices , there is a continued risk that if prices do not continue to improve , or if they start to decline again due to high levels of crude oil production , there is a potential for slowing growth rates in various global regions and or for ongoing supply/demand imbalances . if commodity prices do not continue to improve , or if they start to deteriorate again , demand for our services and products could decline . impact to our business while our 2018 revenues were down compared to 2017 , we are seeing signs of increasing activity in our business , primarily due to the strategic shift we made to move our offerings closer to the reservoir and the associated continued success of our 3-d multi-client programs as well as clients starting to renew interest in conventional reserve replacement and offshore exploration . historically , our revenue and ebitda generation is lower in the first part of the year as customers tend to set budgets in the first quarter , firm up plans through the year , and spend excess budget in the fourth quarter . investments in our multi-client data library are dependent upon the timing of our new venture projects and the availability of underwriting by our customers . we continue to maintain high standards for underwriting new projects . our asset light strategy enables us to scale our business to market conditions avoiding significant fixed costs and maintaining flexibility to manage the timing and amount of our capital expenditures . in our e & p technology & services segment , our new venture revenues experienced significant declines compared to 2017. in the current disciplined spending environment , many clients wait to purchase data associated with a license round until a formal public announcement has been made by the government . delays in license round announcements can materially impact the timing of sales in areas where our new venture programs are underway . our under performance was driven by the continued delay of the panama license round announcement , the three-year moratorium on new upstream licensing in mexico and the continued focus on cash preservation within e & p companies restricting exploration spending . imaging services revenues increased as a result of an increase in proprietary ocean bottom nodal imaging projects . our data library sales increased in 2018 compared to 2017 due to sales of the recently completed phase of the mexico and brazil reimaging programs , along with sales of 2-d data libraries in libya . we invested $ 28.3 million in our multi-client data library during 2018 , approximately $ 4.6 million and $ 13.4 million more compared to 2017 and 2016 , respectively . at december 31 , 2018 , our e & p technology & services segment backlog , which consists of commitments for ( i ) data processing work , ( ii ) new venture projects ( both multi-client and proprietary ) by our ventures group underwritten by our customers and ( iii ) e & p advisors projects , decreased 44 % to $ 21.9 million , compared with $ 39.2 million at december 31 , 2017 . the majority of our backlog relates to our 3-d multi-client reimaging programs offshore brazil and our proprietary imaging services and e & p advisors work . we anticipate that the majority of our backlog will be recognized as revenue over the first half of 2019. within the operations optimization segment , the increase in optimization software & services revenues was due to continued increase in sales of our gator ocean bottom command and control system . devices revenues continue to be impacted by reduced towed streamer seismic contractor activity and cash preservation focus . we have continued to evolve our strategy for our ocean bottom integrated technologies segment consistent with our asset light business model . the remaining elements of our next generation ocean bottom nodal system , 4sea , will be commercialized in 2019. we are offering 4sea components more broadly to the growing number of obs service providers under recurring revenue commercial strategies that will enable us to share in the value our technology delivers . we may also license the right to manufacture and use the fully integrated system to a service provider on a value-based pricing model , such as a royalty stream . such licensing would be recognized through the relevant segment , either e & p technology & services or operations optimization . while not our primary route to market , we continue to evaluate acquisition projects on a case-by-case basis that meet our long-term risk and return thresholds . in 2018 , we recognized a write down of $ 36.6 million for our cable-based ocean bottom acquisition technologies . we continue to see significant long-term potential for our technologies to improve obs safety , efficiency and data quality , and we expect demand for obs surveys to continue increasing . 35 it is our view that technologies that add a competitive advantage through improved imaging , lower costs , higher productivity , or enhanced safety will continue to be valued in our marketplace . story_separator_special_tag million of available borrowing capacity under the credit facility . our cash requirements include working capital requirements and cash required for our debt service payments , multi-client seismic data acquisition activities and capital expenditures . as of december 31 , 2018 , we had working capital of $ 20.1 million . working capital requirements are primarily driven by our investment in our ( i ) multi-client data library ( $ 28.3 million in 2018 ) and royalty payments for multi-client sales . also , our headcount has traditionally been a significant driver of our working capital needs . as a significant portion of our business is involved in the planning , processing and interpretation of seismic data , one of our largest investments is in our employees , which involves cash expenditures for their salaries , bonuses , payroll taxes and related compensation expenses , typically in advance of related revenue billings and collections . our working capital requirements may change from time to time depending upon many factors , including our operating results and adjustments in our operating plan in response to industry conditions , competition and unexpected events . in recent years , our primary sources of funds have been cash flows generated from operations , existing cash balances , debt and equity issuances and borrowings under our revolving credit facility . 42 public equity offering and retirement of debt on february 21 , 2018 , we announced our successful completion of a public equity offering to begin de-levering our balance sheet . we issued and sold 1,820,000 shares of common stock at a public offering price of $ 27.50 per share , and warrants to purchase an additional 1,820,000 shares of our common stock . the net proceeds from this offering were $ 47.0 million , including transaction expenses . a portion of the net proceeds were used to retire our $ 28.5 million third lien notes in march 2018 ( several weeks before their maturity date ) . the warrants have an exercise price of $ 33.60 per share , are immediately exercisable and expire on march 21 , 2019. equity investment program to encourage our executive officers and other key employees to purchase our common stock and further align their interests with those of our stockholders , the board authorized and approved an equity investment program pursuant to which certain of our executive officers and other key employees are permitted , but not obligated , to purchase unregistered shares of our common stock directly from the company at market prices . in connection with any such purchases , the committee authorized and approved , on december 13 , 2017 , a grant by us to such purchasing executive officers and key employees of a certain number of shares of restricted stock . on december 13 , 2017 , the committee also authorized and approved to grant to certain executive officers and key employees a certain number of shares of restricted stock in connection with certain purchases of shares of our common stock in the open market . on december 14 , 2017 , we sold , in a private placement under section 4 ( a ) ( 2 ) of the securities act of 1933 , as amended , 120,567 shares of our common stock at $ 13.05 per share ( the closing price of the our common stock on the nyse on such date ) and executive officers and other key employees purchased 219,346 shares in the open market . revolving credit facility on august 16 , 2018 , we and our material u.s. subsidiaries ; gx technology corporation , ion exploration products ( u.s.a ) and i/o marine systems , inc. ( the “ material u.s. subsidiaries ” ) , along with gx geoscience corporation , s. de r.l . de c.v. , a limited liability company ( sociedad de responsibilidad limitada de capital variable ) organized under the laws of mexico , and a subsidiary of the company ( the “ mexican subsidiary , ” ) ( the material u.s. subsidiaries and the mexican subsidiary are collectively , the “ subsidiary borrowers ” , together with ion geophysical corporation are the “ borrowers ” ) , the financial institutions party thereto , as lenders , and pnc bank , national association ( “ pnc ” ) , as agent for the lenders , entered into that certain third amendment and joinder to revolving credit and security agreement ( the “ third amendment ” ) , amending the revolving credit and security agreement , dated as of august 22 , 2014 ( as previously amended by the first amendment to revolving credit and security agreement , dated as of august 4 , 2015 and the second amendment to revolving credit and security agreement , dated as of april 28 , 2016 , the “ credit agreement ” ) . the credit agreement , as amended by the first amendment , the second amendment and the third amendment is herein called , the “ credit facility ” ) . the third amendment amends the credit agreement to , among other things : extend the maturity date of the credit facility by approximately four years ( from august 22 , 2019 to august 16 , 2023 ) , subject to the retirement or extension of the maturity date of the second lien notes , as defined below , which mature on december 15 , 2021 ; increase the maximum revolver amount by $ 10 million ( from $ 40 million to $ 50 million ) ; increase the borrowing base percentage of the net orderly liquidation value as it relates to the multi-client data library ( not to exceed $ 28.5 million , up from the previous maximum of $ 15 million for the multi-client data library component ) ; include the eligible billed receivables of the mexican subsidiary up to a maximum of $ 5 million in the borrowing base calculation and joins the

for complete details about this waiver from the nol protective measures , please see our form 8-k filed on july 28 , 2010. as of february 28 , 2013 , we had 15,319,433 shares outstanding , and therefore ownership of approximately 766,000 shares or more would currently constitute a “ 5 % shareholder ” . we strongly urge that any stockholder contemplating becoming a 5 % or more shareholder contact us before doing so . pc postage business references when we refer to our “ pc postage ” business , we are referring to our pc postage service and integrations , mailing & shipping supplies store and branded insurance offering . we do not include our photostamps business when we refer to our pc postage business . when we refer to our `` core pc postage business `` , we are referring to the portion of our pc postage business targeting our small business , enterprise and high volume shipping customers . when we refer to our `` non-core pc postage business `` , we are referring to the portion of our pc postage business that targets a more consumer oriented customer through the `` enhanced promotion `` marketing channel . in the `` enhanced promotion `` channel , we work with various companies to advertise our service in a variety of sites on the internet . these companies typically offer an additional promotion ( beyond what we typically offer ) directly to the customer in order to get the customer to try our service and we find that this channel attracts more consumer oriented customers . 23 when we refer to our `` core pc postage revenue , `` we are referring to revenues from service , product and insurance generated by customers in our core pc postage business and when we refer to our `` non-core pc postage revenue , `` we are referring to revenues from service , product and insurance generated by customers in our non-core pc postage business . when we refer to our “ total pc postage revenue , ” we are referring to both core pc postage and non-core pc postage revenues generated from all service , product and insurance revenues . when we refer to our `` core pc postage marketing channels , `` we are referring to our marketing channels targeted at acquiring small business , enterprise and high volume shipping customers . these channels include partnerships , online advertising , affiliate channel , direct mail , traditional media advertising and others . when we refer to our `` non-core pc postage marketing channel , `` we are referring to the online enhanced promotion marketing channel . within our pc postage business , we believe it is useful to discuss core and non-core pc postage because they target different customer types and as a result may represent differing trends . for example , core pc postage generally targets businesses and non-core pc postage generally targets consumers . results of operations years ended december 31 , 2012 and 2011 total revenue increased 14 % to $ 115.7 million in 2012 from $ 101.6 million in 2011. pc postage revenue , including service revenue , product revenue and insurance revenue , in 2012 was $ 110.0 million , an increase of 18 % compared to $ 93.3 million in 2011. core pc postage revenue increased 19 % to $ 107.0 million in 2012 from $ 90.2 million in 2011. non-core pc postage revenue decreased 5 % to $ 3.0 million in 2012 from $ 3.2 million in 2011. photostamps revenue decreased 32 % to $ 5.7 million in 2012 from $ 8.3 million in 2011. other revenue increased 9 % to $ 7,000 in 2012 from $ 6,000 in 2011. the following table sets forth the breakdown of revenue for 2012 and 2011 and the resulting percent change ( revenue in $ 000s ) : replace_table_token_7_th the following table sets forth the breakdown of pc postage revenue , which includes core pc postage revenue and non-core pc postage revenue for 2012 and 2011 and the resulting percent change ( revenue in $ 000s ) : replace_table_token_8_th the increase in core pc postage revenue was driven by both an increase in average revenue per paid customer and an increase in paid customers . average revenue per paid customer increased 5 % to $ 21.18 in 2012 from $ 20.20 in 2011. annual average paid customers increased 13 % to 421,000 in 2012 from 372,000 in 2011 . 24 we define paid customers for the quarter as ones from whom we successfully collected service fees at least once during that quarter , and we define average paid customers for the year as the average of the paid customers for each of the four quarters during the year . the following table sets forth the number of paid customers ( 000s ) in the period for our core pc postage business : replace_table_token_9_th the following table sets forth the growth in paid customers and average annual revenue per paid customer for our core pc postage business : replace_table_token_10_th the increase in paid customers is primarily driven by an increased number of new customers acquired , which was driven by our increased spend in core pc postage marketing channels , while our lost customer churn rates remained at levels that were consistent with the prior year . for our core pc postage business , our average annual and monthly core pc postage revenue per paid customer in 2012 was $ 254 and $ 21.18 respectively , which increased by 5 % compared to $ 242 and $ 20.20 , respectively in 2011. the increase in average revenue per paid customer was primarily attributable to ( 1 ) higher service revenue from our high volume shipping and enterprise customer segments and ( 2 ) an increase in insurance revenue per paid customer driven by our focus on shipping and new insurance features . story_separator_special_tag average revenue per paid customer increased 10 % to $ 20.20 in 2011 from $ 18.25 in 2010. annual average paid customers increased 11 % to 372,000 in 2011 from 337,000 in 2010. we define paid customers for the quarter as ones from whom we successfully collected service fees at least once during that quarter , and we define average paid customers for the year as the average of the paid customers for each of the four quarters during the year . the following table sets forth the total number of paid customers in the period that were originally acquired through our core pc postage channels ( in thousands ) : replace_table_token_16_th the following table sets forth the growth in paid customers and average annual revenue per paid customer for customers originally acquired through our core pc postage channel : replace_table_token_17_th the increase in paid customers in 2011 was primarily attributable to ( 1 ) our increased customer acquisition spending in these channels leading to an increase in the number of customers acquired and ( 2 ) reductions in our paid customer churn rates . for our core pc postage business , our average annual and monthly core pc postage revenue per paid customer in 2011 was $ 242 and $ 20.20 respectively , which increased by 11 % compared to $ 219 and $ 18.25 , respectively in 2010. the increase in average revenue per paid customer was primarily attributable to ( 1 ) higher monthly fees from our high volume shipping and enterprise customer segments , ( 2 ) an increase in the average store revenue per paid customer driven by the increased usage of our service and ( 3 ) an increase in insurance purchases driven by our focus on shipping and new insurance features . 30 the following table sets forth our results of operations as a percentage of total revenue for the periods indicated : replace_table_token_18_th revenue our revenue is derived primarily from five sources : ( 1 ) service and transaction fees related to our pc postage service ; ( 2 ) product revenue from the direct sale of consumables and supplies through our supplies store ; ( 3 ) insurance revenue from our branded insurance offering ; ( 4 ) photostamps revenue from our photostamps business ; and ( 5 ) other revenue , consisting of advertising revenue derived from advertising programs with our existing customers . service revenue increased 17 % to $ 75.5 million in 2011 from $ 64.6 million in 2010. the increase in service revenue consisted of a 20 % increase in service revenue from customers acquired through our non-enhanced promotion channels , which more than offset the 31 % decrease in service revenue from customers acquired through our enhanced promotion channel . the 20 % increase in service revenue from customers acquired through the non-enhanced promotion channels consisted of 10 % increase in successfully billed customers and 9 % increase in average service revenue per customer . as a percentage of total revenue , service revenue decreased to 74 % in 2011 from 76 % in 2010 , primarily as a result of the increase in revenue from our insurance offering . product revenue increased 15 % to $ 13.5 million in 2011 from $ 11.7 million in 2010. the increase in product revenue was primarily attributable to the following : ( 1 ) growth in our paid customer base ; ( 2 ) marketing our supplies store to our existing customer base ; ( 3 ) additional skus we added to our supplies store ; and ( 4 ) growth in postage printed , which helps drive sales of consumable supplies such as labels . total postage printed by customers using our service during 2011 was $ 672 million , a 50 % increase from $ 447 million in 2010. store orders increased by 14 % in 2011 compared to 2010 , while the average revenue per store order increased by 1 % in 2011 compared to 2010. as a percentage of total revenue , product revenue decreased slightly to 13 % in 2011 from 14 % in 2010 , primarily as a result of the increase in revenue from our insurance offering . 31 insurance revenue increased 114 % to $ 4.3 million in 2011 from $ 2.0 million in 2010. this increase was primarily attributable to ( 1 ) the expansion of our existing package insurance offering to cover packages being shipped to international destinations , ( 2 ) insurance purchases resulting from our partnership with amazon.com and ( 3 ) increased insurance purchases by high volume shippers . total postage printed by our high volume shipping customers in 2011 increased by 96 % compared to 2010. as a percentage of total revenue , insurance revenue increased to 4 % in 2011 from 2 % in 2010. photostamps revenue increased 15 % to $ 8.3 million in 2011 from $ 7.2 million in 2010. the increase in photostamps revenue was due to the recognition of photostamps retail box breakage revenue . beginning in the second quarter of 2011 , we began recognizing breakage revenue related to our photostamps retail boxes . during the second quarter of 2011 , we recognized $ 2.2 million of retail box breakage revenue of which $ 2.1 million related to a cumulative catch-up for previously sold and unredeemed photostamps retail boxes originally recorded as deferred revenue . photostamps retail breakage was not material for the third and fourth quarters of 2011. please see note 2 “ summary of significant accounting policies—photostamps retail boxes ” in our notes to consolidated financial statements for further discussion . the increase in photostamps revenue from photostamps retail box breakage was partially offset by lower sales of photostamps through our website and other channels . excluding the photostamps retail box breakage revenue we recognized in the second quarter of 2011 , total photostamps revenue decreased 15 % to $ 6.1 million in 2011 from $

liquidity and capital resources as of december 31 , 2012 and 2011 , we had $ 47 million and $ 69 million in cash , restricted cash and short-term and long-term investments , respectively . we invest available funds in short-term and long-term money market funds , commercial paper , asset-backed securities , corporate notes and bonds and municipal securities and do not engage in hedging or speculative activities . on january 23 , 2012 , we completed the purchase of two adjacent buildings in el segundo , california that now serves as our corporate headquarters for an aggregate purchase price of $ 13.4 million . we substantially completed the renovation and construction project on the property in 2012. we moved into our new corporate headquarters during the third quarter of 2012. we occupy a portion of the 99,600 square foot space , with the remaining portion of the space continuing to be leased to the existing tenants . the purchase of the property and renovations were funded out of our cash flow from operations and existing cash and investments . during 2012 , we repurchased 1.5 million shares of our common stock for $ 31.8 million . during 2013 , subject to limitations that may be imposed by applicable securities laws and regulations and the rules of the nasdaq stock market , we may consider repurchasing stock by evaluating such factors as the price of the stock , the daily trading volume and the availability of large blocks of stock and anyadditional constraints related to material inside information we may possess .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```liquidity and capital resources as of december 31 , 2012 and 2011 , we had $ 47 million and $ 69 million in cash , restricted cash and short-term and long-term investments , respectively . we invest available funds in short-term and long-term money market funds , commercial paper , asset-backed securities , corporate notes and bonds and municipal securities and do not engage in hedging or speculative activities . on january 23 , 2012 , we completed the purchase of two adjacent buildings in el segundo , california that now serves as our corporate headquarters for an aggregate purchase price of $ 13.4 million . we substantially completed the renovation and construction project on the property in 2012. we moved into our new corporate headquarters during the third quarter of 2012. we occupy a portion of the 99,600 square foot space , with the remaining portion of the space continuing to be leased to the existing tenants . the purchase of the property and renovations were funded out of our cash flow from operations and existing cash and investments . during 2012 , we repurchased 1.5 million shares of our common stock for $ 31.8 million . during 2013 , subject to limitations that may be imposed by applicable securities laws and regulations and the rules of the nasdaq stock market , we may consider repurchasing stock by evaluating such factors as the price of the stock , the daily trading volume and the availability of large blocks of stock and anyadditional constraints related to material inside information we may possess . ``` Suspicious Activity Report : for complete details about this waiver from the nol protective measures , please see our form 8-k filed on july 28 , 2010. as of february 28 , 2013 , we had 15,319,433 shares outstanding , and therefore ownership of approximately 766,000 shares or more would currently constitute a “ 5 % shareholder ” . we strongly urge that any stockholder contemplating becoming a 5 % or more shareholder contact us before doing so . pc postage business references when we refer to our “ pc postage ” business , we are referring to our pc postage service and integrations , mailing & shipping supplies store and branded insurance offering . we do not include our photostamps business when we refer to our pc postage business . when we refer to our `` core pc postage business `` , we are referring to the portion of our pc postage business targeting our small business , enterprise and high volume shipping customers . when we refer to our `` non-core pc postage business `` , we are referring to the portion of our pc postage business that targets a more consumer oriented customer through the `` enhanced promotion `` marketing channel . in the `` enhanced promotion `` channel , we work with various companies to advertise our service in a variety of sites on the internet . these companies typically offer an additional promotion ( beyond what we typically offer ) directly to the customer in order to get the customer to try our service and we find that this channel attracts more consumer oriented customers . 23 when we refer to our `` core pc postage revenue , `` we are referring to revenues from service , product and insurance generated by customers in our core pc postage business and when we refer to our `` non-core pc postage revenue , `` we are referring to revenues from service , product and insurance generated by customers in our non-core pc postage business . when we refer to our “ total pc postage revenue , ” we are referring to both core pc postage and non-core pc postage revenues generated from all service , product and insurance revenues . when we refer to our `` core pc postage marketing channels , `` we are referring to our marketing channels targeted at acquiring small business , enterprise and high volume shipping customers . these channels include partnerships , online advertising , affiliate channel , direct mail , traditional media advertising and others . when we refer to our `` non-core pc postage marketing channel , `` we are referring to the online enhanced promotion marketing channel . within our pc postage business , we believe it is useful to discuss core and non-core pc postage because they target different customer types and as a result may represent differing trends . for example , core pc postage generally targets businesses and non-core pc postage generally targets consumers . results of operations years ended december 31 , 2012 and 2011 total revenue increased 14 % to $ 115.7 million in 2012 from $ 101.6 million in 2011. pc postage revenue , including service revenue , product revenue and insurance revenue , in 2012 was $ 110.0 million , an increase of 18 % compared to $ 93.3 million in 2011. core pc postage revenue increased 19 % to $ 107.0 million in 2012 from $ 90.2 million in 2011. non-core pc postage revenue decreased 5 % to $ 3.0 million in 2012 from $ 3.2 million in 2011. photostamps revenue decreased 32 % to $ 5.7 million in 2012 from $ 8.3 million in 2011. other revenue increased 9 % to $ 7,000 in 2012 from $ 6,000 in 2011. the following table sets forth the breakdown of revenue for 2012 and 2011 and the resulting percent change ( revenue in $ 000s ) : replace_table_token_7_th the following table sets forth the breakdown of pc postage revenue , which includes core pc postage revenue and non-core pc postage revenue for 2012 and 2011 and the resulting percent change ( revenue in $ 000s ) : replace_table_token_8_th the increase in core pc postage revenue was driven by both an increase in average revenue per paid customer and an increase in paid customers . average revenue per paid customer increased 5 % to $ 21.18 in 2012 from $ 20.20 in 2011. annual average paid customers increased 13 % to 421,000 in 2012 from 372,000 in 2011 . 24 we define paid customers for the quarter as ones from whom we successfully collected service fees at least once during that quarter , and we define average paid customers for the year as the average of the paid customers for each of the four quarters during the year . the following table sets forth the number of paid customers ( 000s ) in the period for our core pc postage business : replace_table_token_9_th the following table sets forth the growth in paid customers and average annual revenue per paid customer for our core pc postage business : replace_table_token_10_th the increase in paid customers is primarily driven by an increased number of new customers acquired , which was driven by our increased spend in core pc postage marketing channels , while our lost customer churn rates remained at levels that were consistent with the prior year . for our core pc postage business , our average annual and monthly core pc postage revenue per paid customer in 2012 was $ 254 and $ 21.18 respectively , which increased by 5 % compared to $ 242 and $ 20.20 , respectively in 2011. the increase in average revenue per paid customer was primarily attributable to ( 1 ) higher service revenue from our high volume shipping and enterprise customer segments and ( 2 ) an increase in insurance revenue per paid customer driven by our focus on shipping and new insurance features . story_separator_special_tag average revenue per paid customer increased 10 % to $ 20.20 in 2011 from $ 18.25 in 2010. annual average paid customers increased 11 % to 372,000 in 2011 from 337,000 in 2010. we define paid customers for the quarter as ones from whom we successfully collected service fees at least once during that quarter , and we define average paid customers for the year as the average of the paid customers for each of the four quarters during the year . the following table sets forth the total number of paid customers in the period that were originally acquired through our core pc postage channels ( in thousands ) : replace_table_token_16_th the following table sets forth the growth in paid customers and average annual revenue per paid customer for customers originally acquired through our core pc postage channel : replace_table_token_17_th the increase in paid customers in 2011 was primarily attributable to ( 1 ) our increased customer acquisition spending in these channels leading to an increase in the number of customers acquired and ( 2 ) reductions in our paid customer churn rates . for our core pc postage business , our average annual and monthly core pc postage revenue per paid customer in 2011 was $ 242 and $ 20.20 respectively , which increased by 11 % compared to $ 219 and $ 18.25 , respectively in 2010. the increase in average revenue per paid customer was primarily attributable to ( 1 ) higher monthly fees from our high volume shipping and enterprise customer segments , ( 2 ) an increase in the average store revenue per paid customer driven by the increased usage of our service and ( 3 ) an increase in insurance purchases driven by our focus on shipping and new insurance features . 30 the following table sets forth our results of operations as a percentage of total revenue for the periods indicated : replace_table_token_18_th revenue our revenue is derived primarily from five sources : ( 1 ) service and transaction fees related to our pc postage service ; ( 2 ) product revenue from the direct sale of consumables and supplies through our supplies store ; ( 3 ) insurance revenue from our branded insurance offering ; ( 4 ) photostamps revenue from our photostamps business ; and ( 5 ) other revenue , consisting of advertising revenue derived from advertising programs with our existing customers . service revenue increased 17 % to $ 75.5 million in 2011 from $ 64.6 million in 2010. the increase in service revenue consisted of a 20 % increase in service revenue from customers acquired through our non-enhanced promotion channels , which more than offset the 31 % decrease in service revenue from customers acquired through our enhanced promotion channel . the 20 % increase in service revenue from customers acquired through the non-enhanced promotion channels consisted of 10 % increase in successfully billed customers and 9 % increase in average service revenue per customer . as a percentage of total revenue , service revenue decreased to 74 % in 2011 from 76 % in 2010 , primarily as a result of the increase in revenue from our insurance offering . product revenue increased 15 % to $ 13.5 million in 2011 from $ 11.7 million in 2010. the increase in product revenue was primarily attributable to the following : ( 1 ) growth in our paid customer base ; ( 2 ) marketing our supplies store to our existing customer base ; ( 3 ) additional skus we added to our supplies store ; and ( 4 ) growth in postage printed , which helps drive sales of consumable supplies such as labels . total postage printed by customers using our service during 2011 was $ 672 million , a 50 % increase from $ 447 million in 2010. store orders increased by 14 % in 2011 compared to 2010 , while the average revenue per store order increased by 1 % in 2011 compared to 2010. as a percentage of total revenue , product revenue decreased slightly to 13 % in 2011 from 14 % in 2010 , primarily as a result of the increase in revenue from our insurance offering . 31 insurance revenue increased 114 % to $ 4.3 million in 2011 from $ 2.0 million in 2010. this increase was primarily attributable to ( 1 ) the expansion of our existing package insurance offering to cover packages being shipped to international destinations , ( 2 ) insurance purchases resulting from our partnership with amazon.com and ( 3 ) increased insurance purchases by high volume shippers . total postage printed by our high volume shipping customers in 2011 increased by 96 % compared to 2010. as a percentage of total revenue , insurance revenue increased to 4 % in 2011 from 2 % in 2010. photostamps revenue increased 15 % to $ 8.3 million in 2011 from $ 7.2 million in 2010. the increase in photostamps revenue was due to the recognition of photostamps retail box breakage revenue . beginning in the second quarter of 2011 , we began recognizing breakage revenue related to our photostamps retail boxes . during the second quarter of 2011 , we recognized $ 2.2 million of retail box breakage revenue of which $ 2.1 million related to a cumulative catch-up for previously sold and unredeemed photostamps retail boxes originally recorded as deferred revenue . photostamps retail breakage was not material for the third and fourth quarters of 2011. please see note 2 “ summary of significant accounting policies—photostamps retail boxes ” in our notes to consolidated financial statements for further discussion . the increase in photostamps revenue from photostamps retail box breakage was partially offset by lower sales of photostamps through our website and other channels . excluding the photostamps retail box breakage revenue we recognized in the second quarter of 2011 , total photostamps revenue decreased 15 % to $ 6.1 million in 2011 from $

the increase in electrical sales was due to continued strong growth for protection relays and custom products driven primarily by strength in the potash mining market . additionally , electrical fuse products realized steady improvement in demand as the industrial market continued to recover in 2010. the electrical segment experienced net favorable currency effects of $ 3.6 million primarily from sales denominated in the canadian dollar . on a geographic basis , sales in the americas increased $ 61.6 million or 37 % in 2010 compared to 2009. this increase resulted from increases at all three of the company 's business segments . automotive sales increased $ 8.1 million or 23 % primarily reflecting recovery in the passenger vehicle market . electronics sales increased $ 35.3 million or 55 % reflecting strong end market demand and distributor restocking . electrical sales increased $ 18.2 million or 27 % resulting from an increase in demand for protection relays , custom products and power fuses . the americas region also experienced $ 3.6 million in favorable currency effects resulting from sales denominated in the canadian dollar . europe sales increased $ 31.7 million or 38 % in 2010 compared to 2009. this increase resulted from increases at all three of the company 's business segments . automotive sales increased $ 13.4 million or 29 % reflecting strong end market demand and increased production resulting from the economic recovery in europe during 2010. electronics sales increased $ 18.0 million or 48 % reflecting strong end market demand and distributor inventory replenishment . electrical sales increased $ 0.3 million . current year results included unfavorable currency effects of $ 5.6 million , reflecting a weaker euro in 2010. asia-pacific sales increased $ 84.6 million or 47 % in 2010 compared to 2009. this increase resulted from increases at all three of the company 's business segments . automotive sales increased $ 10.4 million or 59 % reflecting continued increased demand for passenger vehicles in the developing asian markets as well as gains in market share . electronics sales increased $ 73.6 million or 46 % primarily reflecting growth in demand for consumer products and restocking by distributors . electrical sales increased $ 0.6 million or 41 % . current year results included favorable currency translation effects of $ 3.2 million primarily due to the impact of a stronger japanese yen and korean won . gross profit was $ 233.9 million or 38.5 % of sales in 2010 , compared to $ 125.4 million or 29.1 % of sales in 2009. the increase in gross profit margin percentage in 2010 resulted from operating leverage on higher sales , an improved cost structure due to consolidation of manufacturing facilities and the impact of restructuring activities in 2009. the company recorded approximately $ 4.2 million of restructuring charges in cost of sales in 2009 due primarily to the reorganization of the company 's european and asian operations . the european restructuring charges included the transfer of its manufacturing operations from dünsen , germany , to piedras negras , mexico . the asian restructuring included the planned closure of a manufacturing facility in taiwan . 23 the company continues to focus heavily on research and development ( r & d ) to develop new solutions for customers and expand product offerings . during 2010 , the company continued moving r & d operations to lower cost locations closer to its customers . r & d operations are now in canada , china , germany , the philippines and mexico , as well as the united states . total operating expense was $ 126.3 million or 20.8 % of net sales for 2010 compared to $ 111.7 million or 26.0 % of net sales for 2009. the increase in operating expenses primarily reflects the increased cost of company incentive programs driven by significantly improved financial performance in 2010. higher transportation costs driven by higher sales volumes also contributed to the increase in operating expenses . operating expenses as a percentage of sales improved in 2010 as compared to 2009 as a result of cost reduction plans initiated in 2009 resulting in improved operating efficiencies across the company . operating income was $ 107.6 million or 17.7 % of net sales in 2010 compared to $ 13.7 million or 3.2 % of net sales in the prior year . the increase in operating income in the current year was due primarily to the increase in sales and reduction in costs as described above . interest expense , net , decreased to $ 1.4 million in 2010 compared to $ 2.4 million for 2009 primarily due to lower borrowing in 2010. other expense ( income ) , net , consisting of interest income , royalties , non-operating income and foreign currency items , was $ 1.5 million of income in 2010 compared to $ 0.5 million of expense in 2009. the increase reflected a favorable net change of approximately $ 1.3 million in foreign currency translation effects primarily due to the strengthening of the philippine peso and mexican peso against the u.s. dollar . income before income taxes was $ 107.7 million in 2010 compared to $ 10.8 million in 2009. income tax expense was $ 29.0 million in 2010 compared to $ 1.4 million in 2009. the 2010 effective income tax rate was 27.0 % compared to 13.2 % in 2009. the increase in the 2010 effective tax rate reflects more income earned in high tax jurisdictions in 2010 ( primarily the u.s. ) as well as the favorable effects of one-time tax adjustments in 2009. results of operations — 2009 compared with 2008 net sales decreased in 2009 to $ 430.1 million compared to $ 530.9 million in 2008. these results reflected sales declines in the automotive segment of $ 28.4 million or 22 % to $ 98.5 million , along with a decrease in sales in the electronics segment of $ 79.5 million or 23 % to $ story_separator_special_tag in december 2010 , the fasb issued authoritative guidance related to disclosure of supplementary pro forma information for business combinations . the guidance specified that if a public entity presents comparative financial statements , the entity should disclose revenue and earnings of the combined entity as though the business combination ( s ) that occurred during the current year had occurred as of the beginning of the comparable prior annual reporting period only . the amendments also expand the supplemental pro forma disclosures to include a description of the nature and amount of material , nonrecurring pro forma adjustments directly attributable to the business combination included in the reported pro forma revenue and earnings . the guidance is effective prospectively for business combinations for which the acquisition date is on or after the beginning of the first annual reporting period beginning on or after december 15 , 2010. the company does not believe that the adoption of this new guidance will have a material impact on its consolidated financial statements . 30 in december 2010 , the fasb issued an authoritative guidance describing when to perform step 2 of the goodwill impairment test for reporting units with zero or negative carrying amounts . the amendments in this guidance modify step 1 of the goodwill impairment test for reporting units with zero or negative carrying amounts . for those reporting units , an entity is required to perform step 2 of the goodwill impairment test if it is more likely than not that a goodwill impairment exists . in determining whether it is more likely than not that goodwill impairment exists , an entity should consider whether there are any adverse qualitative factors indicating that impairment may exist . the qualitative factors are consistent with the existing guidance and examples , which require that goodwill of a reporting unit be tested for impairment between annual tests if an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying amount . for public entities , the amendments in this guidance are effective for fiscal years , and interim periods within those years , beginning after december 15 , 2010. early adoption is not permitted . the company expects to adopt this new guidance effective the beginning of fiscal year 2011 , and does not expect it to have a material impact on its consolidated financial statements . critical accounting policies and estimates certain of the accounting policies as discussed below require the application of significant judgment by management in selecting the appropriate estimates and assumptions for calculating amounts to record in the financial statements . actual results could differ from those estimates and assumptions , impacting the reported results of operations and financial position . significant accounting policies are more fully described in the notes to consolidated financial statements included elsewhere in this annual report . certain accounting policies , however , are considered to be critical in that they are most important to the depiction of the company 's financial condition and results of operations and their application requires management 's subjective judgment in making estimates about the effect of matters that are inherently uncertain . the company believes the following accounting policies are the most critical to aid in fully understanding and evaluating its reported financial results , as they require management 's most difficult , subjective or complex judgments , resulting from the need to make estimates about the effect of matters that are inherently uncertain . the company has reviewed these critical accounting policies and related disclosures with the audit committee of its board of directors . net sales revenue recognition : the company recognizes revenue on product sales in the period in which the sales process is complete . this generally occurs when products are shipped ( fob origin ) to the customer in accordance with the terms of the sale , the risk of loss has been transferred , collectability is reasonably assured and the pricing is fixed and determinable . at the end of each period , for those shipments where title to the products and the risk of loss and rewards of ownership do not transfer until the product has been received by the customer , the company adjusts revenues and cost of sales for the delay between the time that the products are shipped and when they are received by the customer . the company 's distribution channels are primarily through direct sales and independent third party distributors . revenue and billing : the company accepts orders from customers based on long term purchasing contracts and written sales agreements . contract pricing and selling agreement terms are based on market factors , costs and competition . pricing normally is negotiated as an adjustment ( premium or discount ) from the company 's published price lists . the customer is invoiced when the company 's products are shipped to them in accordance with the terms of the sales agreement . 31 returns and credits : some of the terms of the company 's sales agreements and normal business conditions provide customers ( distributors ) the ability to receive price adjustments on products previously shipped and invoiced . this practice is common in the industry and is referred to as a “ ship and debit ” program . this program allows the distributor to debit the company for the difference between the distributors ' contracted price and a lower price for specific transactions . under certain circumstances ( usually in a competitive situation or large volume opportunity ) , a distributor will request authorization to reduce its price to its buyer . if the company approves such a reduction , the distributor is authorized to “ debit ” its account for the difference between the contracted price and the lower approved price . the company establishes reserves for this program based on historic activity and actual authorizations for the debit and recognizes these

cash flows and working capital the company started 2010 with $ 70.4 million of cash . net cash provided by operating activities in 2010 was approximately $ 104.1 million in the year and included $ 78.7 million in net income and $ 46.1 million in non-cash adjustments ( primarily $ 32.0 million in depreciation and amortization ) , partially offset by $ 20.7 million of changes in operating assets and liabilities . changes in various operating assets and liabilities ( including short-term and long-term items ) that negatively impacted cash flows in 2010 consisted of increases in accounts receivable ( $ 12.8 million ) and inventories ( $ 15.1 million ) , a decrease in accounts payable ( $ 1.8 million ) and accrued expenses ( including post-retirement ) ( $ 13.6 million ) . the increase in accounts receivable result from increased sales activity . the increase in inventory results from increased sales activity and production rates in addition to higher prices for raw materials . additionally , the company made contributions to its domestic and foreign pension plans of $ 16.2 million in 2010. positively impacting cash flows were increases in accrued payroll and severance ( $ 2.4 million ) , accrued taxes ( $ 14.9 million ) , and a decrease in prepaid expenses and other current assets ( $ 5.4 million ) . net cash used in investing activities in 2010 was approximately $ 65.7 million and included $ 22.4 million in purchases of property , plant and equipment ( primarily related to the company 's plant expansion and new facilities in the asia-pacific region ) , and a net $ 48.3 million for the acquisition of cole hersee during the fourth quarter of 2010 , partially offset by $ 5.0 million in cash receipts from the sale of property , plant and equipment . the majority of the receipts from asset sales resulted from the sale of the company 's land and building at its utrecht , netherlands location .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```cash flows and working capital the company started 2010 with $ 70.4 million of cash . net cash provided by operating activities in 2010 was approximately $ 104.1 million in the year and included $ 78.7 million in net income and $ 46.1 million in non-cash adjustments ( primarily $ 32.0 million in depreciation and amortization ) , partially offset by $ 20.7 million of changes in operating assets and liabilities . changes in various operating assets and liabilities ( including short-term and long-term items ) that negatively impacted cash flows in 2010 consisted of increases in accounts receivable ( $ 12.8 million ) and inventories ( $ 15.1 million ) , a decrease in accounts payable ( $ 1.8 million ) and accrued expenses ( including post-retirement ) ( $ 13.6 million ) . the increase in accounts receivable result from increased sales activity . the increase in inventory results from increased sales activity and production rates in addition to higher prices for raw materials . additionally , the company made contributions to its domestic and foreign pension plans of $ 16.2 million in 2010. positively impacting cash flows were increases in accrued payroll and severance ( $ 2.4 million ) , accrued taxes ( $ 14.9 million ) , and a decrease in prepaid expenses and other current assets ( $ 5.4 million ) . net cash used in investing activities in 2010 was approximately $ 65.7 million and included $ 22.4 million in purchases of property , plant and equipment ( primarily related to the company 's plant expansion and new facilities in the asia-pacific region ) , and a net $ 48.3 million for the acquisition of cole hersee during the fourth quarter of 2010 , partially offset by $ 5.0 million in cash receipts from the sale of property , plant and equipment . the majority of the receipts from asset sales resulted from the sale of the company 's land and building at its utrecht , netherlands location . ``` Suspicious Activity Report : the increase in electrical sales was due to continued strong growth for protection relays and custom products driven primarily by strength in the potash mining market . additionally , electrical fuse products realized steady improvement in demand as the industrial market continued to recover in 2010. the electrical segment experienced net favorable currency effects of $ 3.6 million primarily from sales denominated in the canadian dollar . on a geographic basis , sales in the americas increased $ 61.6 million or 37 % in 2010 compared to 2009. this increase resulted from increases at all three of the company 's business segments . automotive sales increased $ 8.1 million or 23 % primarily reflecting recovery in the passenger vehicle market . electronics sales increased $ 35.3 million or 55 % reflecting strong end market demand and distributor restocking . electrical sales increased $ 18.2 million or 27 % resulting from an increase in demand for protection relays , custom products and power fuses . the americas region also experienced $ 3.6 million in favorable currency effects resulting from sales denominated in the canadian dollar . europe sales increased $ 31.7 million or 38 % in 2010 compared to 2009. this increase resulted from increases at all three of the company 's business segments . automotive sales increased $ 13.4 million or 29 % reflecting strong end market demand and increased production resulting from the economic recovery in europe during 2010. electronics sales increased $ 18.0 million or 48 % reflecting strong end market demand and distributor inventory replenishment . electrical sales increased $ 0.3 million . current year results included unfavorable currency effects of $ 5.6 million , reflecting a weaker euro in 2010. asia-pacific sales increased $ 84.6 million or 47 % in 2010 compared to 2009. this increase resulted from increases at all three of the company 's business segments . automotive sales increased $ 10.4 million or 59 % reflecting continued increased demand for passenger vehicles in the developing asian markets as well as gains in market share . electronics sales increased $ 73.6 million or 46 % primarily reflecting growth in demand for consumer products and restocking by distributors . electrical sales increased $ 0.6 million or 41 % . current year results included favorable currency translation effects of $ 3.2 million primarily due to the impact of a stronger japanese yen and korean won . gross profit was $ 233.9 million or 38.5 % of sales in 2010 , compared to $ 125.4 million or 29.1 % of sales in 2009. the increase in gross profit margin percentage in 2010 resulted from operating leverage on higher sales , an improved cost structure due to consolidation of manufacturing facilities and the impact of restructuring activities in 2009. the company recorded approximately $ 4.2 million of restructuring charges in cost of sales in 2009 due primarily to the reorganization of the company 's european and asian operations . the european restructuring charges included the transfer of its manufacturing operations from dünsen , germany , to piedras negras , mexico . the asian restructuring included the planned closure of a manufacturing facility in taiwan . 23 the company continues to focus heavily on research and development ( r & d ) to develop new solutions for customers and expand product offerings . during 2010 , the company continued moving r & d operations to lower cost locations closer to its customers . r & d operations are now in canada , china , germany , the philippines and mexico , as well as the united states . total operating expense was $ 126.3 million or 20.8 % of net sales for 2010 compared to $ 111.7 million or 26.0 % of net sales for 2009. the increase in operating expenses primarily reflects the increased cost of company incentive programs driven by significantly improved financial performance in 2010. higher transportation costs driven by higher sales volumes also contributed to the increase in operating expenses . operating expenses as a percentage of sales improved in 2010 as compared to 2009 as a result of cost reduction plans initiated in 2009 resulting in improved operating efficiencies across the company . operating income was $ 107.6 million or 17.7 % of net sales in 2010 compared to $ 13.7 million or 3.2 % of net sales in the prior year . the increase in operating income in the current year was due primarily to the increase in sales and reduction in costs as described above . interest expense , net , decreased to $ 1.4 million in 2010 compared to $ 2.4 million for 2009 primarily due to lower borrowing in 2010. other expense ( income ) , net , consisting of interest income , royalties , non-operating income and foreign currency items , was $ 1.5 million of income in 2010 compared to $ 0.5 million of expense in 2009. the increase reflected a favorable net change of approximately $ 1.3 million in foreign currency translation effects primarily due to the strengthening of the philippine peso and mexican peso against the u.s. dollar . income before income taxes was $ 107.7 million in 2010 compared to $ 10.8 million in 2009. income tax expense was $ 29.0 million in 2010 compared to $ 1.4 million in 2009. the 2010 effective income tax rate was 27.0 % compared to 13.2 % in 2009. the increase in the 2010 effective tax rate reflects more income earned in high tax jurisdictions in 2010 ( primarily the u.s. ) as well as the favorable effects of one-time tax adjustments in 2009. results of operations — 2009 compared with 2008 net sales decreased in 2009 to $ 430.1 million compared to $ 530.9 million in 2008. these results reflected sales declines in the automotive segment of $ 28.4 million or 22 % to $ 98.5 million , along with a decrease in sales in the electronics segment of $ 79.5 million or 23 % to $ story_separator_special_tag in december 2010 , the fasb issued authoritative guidance related to disclosure of supplementary pro forma information for business combinations . the guidance specified that if a public entity presents comparative financial statements , the entity should disclose revenue and earnings of the combined entity as though the business combination ( s ) that occurred during the current year had occurred as of the beginning of the comparable prior annual reporting period only . the amendments also expand the supplemental pro forma disclosures to include a description of the nature and amount of material , nonrecurring pro forma adjustments directly attributable to the business combination included in the reported pro forma revenue and earnings . the guidance is effective prospectively for business combinations for which the acquisition date is on or after the beginning of the first annual reporting period beginning on or after december 15 , 2010. the company does not believe that the adoption of this new guidance will have a material impact on its consolidated financial statements . 30 in december 2010 , the fasb issued an authoritative guidance describing when to perform step 2 of the goodwill impairment test for reporting units with zero or negative carrying amounts . the amendments in this guidance modify step 1 of the goodwill impairment test for reporting units with zero or negative carrying amounts . for those reporting units , an entity is required to perform step 2 of the goodwill impairment test if it is more likely than not that a goodwill impairment exists . in determining whether it is more likely than not that goodwill impairment exists , an entity should consider whether there are any adverse qualitative factors indicating that impairment may exist . the qualitative factors are consistent with the existing guidance and examples , which require that goodwill of a reporting unit be tested for impairment between annual tests if an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying amount . for public entities , the amendments in this guidance are effective for fiscal years , and interim periods within those years , beginning after december 15 , 2010. early adoption is not permitted . the company expects to adopt this new guidance effective the beginning of fiscal year 2011 , and does not expect it to have a material impact on its consolidated financial statements . critical accounting policies and estimates certain of the accounting policies as discussed below require the application of significant judgment by management in selecting the appropriate estimates and assumptions for calculating amounts to record in the financial statements . actual results could differ from those estimates and assumptions , impacting the reported results of operations and financial position . significant accounting policies are more fully described in the notes to consolidated financial statements included elsewhere in this annual report . certain accounting policies , however , are considered to be critical in that they are most important to the depiction of the company 's financial condition and results of operations and their application requires management 's subjective judgment in making estimates about the effect of matters that are inherently uncertain . the company believes the following accounting policies are the most critical to aid in fully understanding and evaluating its reported financial results , as they require management 's most difficult , subjective or complex judgments , resulting from the need to make estimates about the effect of matters that are inherently uncertain . the company has reviewed these critical accounting policies and related disclosures with the audit committee of its board of directors . net sales revenue recognition : the company recognizes revenue on product sales in the period in which the sales process is complete . this generally occurs when products are shipped ( fob origin ) to the customer in accordance with the terms of the sale , the risk of loss has been transferred , collectability is reasonably assured and the pricing is fixed and determinable . at the end of each period , for those shipments where title to the products and the risk of loss and rewards of ownership do not transfer until the product has been received by the customer , the company adjusts revenues and cost of sales for the delay between the time that the products are shipped and when they are received by the customer . the company 's distribution channels are primarily through direct sales and independent third party distributors . revenue and billing : the company accepts orders from customers based on long term purchasing contracts and written sales agreements . contract pricing and selling agreement terms are based on market factors , costs and competition . pricing normally is negotiated as an adjustment ( premium or discount ) from the company 's published price lists . the customer is invoiced when the company 's products are shipped to them in accordance with the terms of the sales agreement . 31 returns and credits : some of the terms of the company 's sales agreements and normal business conditions provide customers ( distributors ) the ability to receive price adjustments on products previously shipped and invoiced . this practice is common in the industry and is referred to as a “ ship and debit ” program . this program allows the distributor to debit the company for the difference between the distributors ' contracted price and a lower price for specific transactions . under certain circumstances ( usually in a competitive situation or large volume opportunity ) , a distributor will request authorization to reduce its price to its buyer . if the company approves such a reduction , the distributor is authorized to “ debit ” its account for the difference between the contracted price and the lower approved price . the company establishes reserves for this program based on historic activity and actual authorizations for the debit and recognizes these

we sell our software and services to companies using a variety of sales and marketing tactics . we have teams of inside sales representatives organized by vertical market who engage directly with companies . we have enterprise sales teams which target the large named accounts in each of our vertical markets . these teams are supported by a variety of typical software marketing tactics , including both digital , in-person ( such as trade shows and other events ) and content marketing . for consumers , porch largely relies on our unique and proprietary relationships with the approximately 11,000 companies using porch 's software to provide the company with end customer access and introductions . porch then utilizes technology , lifecycle marketing and teams in lower cost locations to operate as a moving concierge to assist these consumers with services . porch has invested in limited direct-to-consumer ( “ d2c ” ) marketing capabilities , but expects to become more advanced over time with capabilities such as digital and social retargeting . 47 key performance measures and operating metrics in the management of our businesses , we identify , measure and evaluate a variety of operating metrics . the key performance measures and operating metrics we use in managing our businesses are set forth below . these key performance measures and operating metrics are not prepared in accordance with gaap , and may not be comparable to or calculated in the same way as other similarly titled measures and metrics used by other companies . the key performance measures presented have been adjusted for divested porch businesses in 2018 through 2020 . ● average number of companies in quarter — porch provides software and services to home services companies and , through these relationships , gains unique and early access to homebuyers and homeowners , assists homebuyers and homeowners with critical services such as insurance and moving . porch ' s customers include home services companies , such as home inspectors , for whom porch provides software and services and who provide introductions to homebuyers and homeowners . porch tracks the average number of home services companies from which it generates revenue each quarter in order to measure our ability to attract , retain and grow our relationships with home services companies . management defines average companies in a quarter as the number of home services companies across all of porch ' s home services verticals that ( i ) had revenue contracts with us and ( ii ) generated revenue each month , averaged across a quarterly period . ● average revenue per account per month — management views porch ' s ability to increase revenue generated from existing customers as a key component of porch ' s growth strategy . average revenue per account per month in quarter is defined as the average revenue per month generated across all our home services company customer accounts in a quarterly period . average revenue per account per month in quarter are derived from all customers and total revenue ; not only customers and revenues associated with porch ' s referral network , the following table summarizes our average companies in quarter and average revenue per account per month for each of the quarterly periods indicated : ​ replace_table_token_1_th ​ ● number of monetized services in quarter — porch connects consumers with home services companies nationwide and offers a full range of products and services where homeowners can , among other things : ( i ) compare and buy home insurance policies ( along with auto , flood and umbrella policies ) with competitive rates and coverage ; ( ii ) arrange for a variety of services in connection with their move , from labor to load or unload a truck to full-service , long-distance moving services ; ( iii ) discover and install home automation and security systems ; ( iv ) compare internet and television options for their new home ; ( v ) book small handyman jobs at fixed , upfront prices with guaranteed quality ; and ( vi ) compare bids from home improvement professionals who can complete bigger jobs . porch tracks the number of monetized services performed through its platform each quarter and the revenue generated per service performed in order to measure to measure market penetration with homebuyers and homeowners and porch ' s ability to deliver high-revenue services within those groups . monetized services per quarter is defined as the total number of unique services from which we generated revenue , including , but not limited to , new insurance customers , completed moving jobs , security installations , tv/internet installations or other home projects , measured over a quarterly period . ● average revenue per monetized service — management believes that shifting the mix of services delivered to homebuyers and home owners toward higher revenue services is a key component of porch ' s growth strategy . average revenue per monetized services in quarter is the average revenue generated per monetized service performed in a quarterly period . when calculating average revenue per monetized service in quarter , average revenue is defined as total quarterly service transaction revenues generated from monetized services divided by three months . 48 the following table summarizes our monetized services and average revenue per monetized service for each of the quarterly periods indicated : ​ replace_table_token_2_th ​ in 2020 , the company shifted insurance monetization from getting paid per quote to earning multiyear insurance commissions , resulting in fewer monetized transactions with higher average revenue . in march 2020 , covid-19 impacted the service volumes during the period from march until june . the impact on service volumes , largely recovered by june 30 , 2020 and after adjusting for insurance monetization remains above prior year volumes . story_separator_special_tag 53 there are a variety of estimates in the black-scholes opinion pricing model , including the determination of the fair value of the company 's common stock , expected volatility , term , dividends and risk-free rate . prior to the close of the merger , we engaged an independent third-party valuation consultant to make periodic valuations of our class of common and preferred stock . the fair value of restricted stock awards is based on the value of the underlying stock , which is estimated periodically with assistance from the independent third-party valuation specialist using both market and income approaches . business combinations the company has engaged in mergers and acquisitions and intends to continue to make acquisitions a significant part of our growth strategy . the company made acquisitions with cash and non-cash consideration totaling $ 0.4 million in 2019 and $ 17.6 million in 2020. the company accounts for business acquisitions using the acquisition method of accounting and records any identifiable intangible assets separate from goodwill . intangible assets are recorded at their fair value based on estimates as of the date of acquisition . goodwill is recorded as the residual amount of the purchase price consideration less the fair value assigned to the individual identifiable assets acquired and liabilities assumed as of the date of acquisition . the accounting estimates associated with acquisitions are complex due to judgements and assumptions involved in determining ( 1 ) the total consideration paid because we have used cash , stock and earnouts and ( 2 ) the value of assets acquired and liabilities assumed . the company allocates the purchase price of the acquisition to the assets acquired and liabilities assumed based on estimates of the fair value at the dates of the acquisitions . contingent consideration , which represents an obligation of the company to make additional payments or equity interests to the former owner as part of the purchase price if specified future events occur or conditions are met , is accounted for at the acquisition date fair value either as a liability or as equity depending on the terms of the acquisition agreement . results of operations comparison of fiscal year ended december 31 , 2020 to fiscal year ended december 31 , 2019 the net loss in 2020 of $ 51.6 million compared with the net loss in 2019 of $ 103.3 million was impacted by a large , one-time stock-based compensation charge of $ 33.2 million related to the company 's ceo 2019 secondary stock sale transaction , 2019 losses on the remeasurement or extinguishment of debt and warrants that totaled $ 9.0 million , and a $ 5.0 million gain on a divestiture of a businesses in 2019 . 54 the following table sets forth our historical operating results for the periods indicated , with fiscal year 2019 incorporating operating results of since-divested businesses : ​ replace_table_token_3_th nm — percentage calculated is not meaningful . revenue total revenue decreased by $ 4.4 million , or 6 % from $ 77.6 million in the year ended december 31 , 2019 to $ 73.2 million in the year ended december 31 , 2020. revenue decreased by $ 17.7 million due to divested porch businesses , offset by increase in revenue in 2020 primarily driven by the growth in our moving services and insurance businesses , which contributed $ 13.8 million of the revenue increase in 2020. as porch has grown the number of companies that use our software and services , we have been able to grow our b2b2c ( “ business to business to consumer ” ) and move related services revenues . this includes revenues related to moving , insurance , tv/internet connections , and security . cost of revenue cost of revenue decreased by $ 3.9 million , or 18 % from $ 21.5 million in the year ended december 31 , 2019 to $ 17.6 million in the year ended december 31 , 2020. the decrease in the cost of revenue was mostly attributable to a $ 5.9 million of costs related to divested businesses , offset by growth in moving services . as a percentage of revenue , cost of revenue represented 24 % of revenue in 2020 compared to 28 % in 2019 . 55 selling and marketing selling and marketing expenses decreased by $ 14.4 million , or 26 % from $ 56.2 million in the year ended december 31 , 2019 to $ 41.8 million in the year ended december 31 , 2020. the decrease is due to $ 6.8 million related to divested businesses , $ 7.6 million mainly related to savings in third party data leads and marketing costs . the spend on data leads was optimized by focusing on the most productive lead sources that reduced overall spend and generated higher revenue . as a percentage of revenue , selling and marketing expenses represented 57 % of revenue in 2020 compared with 73 % in 2019 due to the economies of scale . product and technology product and technology expenses decreased by $ 2.7 million , or 9 % from $ 31 million in the year ended december 31 , 2019 to $ 28.3 million in the year ended december 31 , 2020. the $ 2.7 million decrease is due to divested businesses of $ 3.1 million , offset by growth in our moving group . as a percentage of revenue , product and technology expenses represented 39 % of revenue in 2020 compared with 40 % in 2019. general and administrative general and administrative expenses decreased by $ 23.6 million , or 45 % from $ 52 million in the year ended december 31 , 2019 to $ 28.4 million in the year ended december 31 , 2020 primarily due to a significantly higher stock-based compensation charge related to the 2019 secondary market transaction as indicated in the table below , offset by higher stock-based compensation related to employee awards in 2020. stock-based

liquidity and capital resources since inception , we have financed our operations primarily from the sales of redeemable convertible preferred stock and convertible promissory notes , and proceeds from senior secured loans . on december 23 , 2020 , the company received approximately $ 269.5 million of aggregate cash proceeds from recapitalization , net of transactions costs . as of 58 december 31 , 2020 , the company had cash and cash equivalents of $ 196 million and $ 11.4 million of restricted cash representing the minimum cash balance of $ 3.0 million required by our senior secured lenders and $ 8.4 million of loan proceeds related to the paycheck protection program loan . the company has incurred losses since its inception , and has an accumulated deficit at december 31 , 2020 and december 31 , 2019 totaling $ 315.1 million and $ 263.5 million , respectively . as of december 31 , 2020 , and december 31 , 2019 the company had $ 50.8 million and $ 65.7 million aggregate principal amount outstanding on term loans and promissory notes , respectively . during 2020 , the company refinanced the existing $ 40.0 million term loans and received additional loan proceeds of $ 7.0 million from new senior secured term loans and $ 8.3 million from the u.s. government pursuant to the paycheck protection program under the cares act . in august and october 2020 , the company received a total of $ 10.0 million in loan proceeds from a convertible loan agreement , which was repaid along with other subordinated notes payable in connection with the merger . the company has used debt proceeds principally to fund general operations and acquisitions . in 2020 , the company invested $ 7.8 million ( net of cash acquired ) to acquire four companies , in a transaction accounted for as a business combination .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```liquidity and capital resources since inception , we have financed our operations primarily from the sales of redeemable convertible preferred stock and convertible promissory notes , and proceeds from senior secured loans . on december 23 , 2020 , the company received approximately $ 269.5 million of aggregate cash proceeds from recapitalization , net of transactions costs . as of 58 december 31 , 2020 , the company had cash and cash equivalents of $ 196 million and $ 11.4 million of restricted cash representing the minimum cash balance of $ 3.0 million required by our senior secured lenders and $ 8.4 million of loan proceeds related to the paycheck protection program loan . the company has incurred losses since its inception , and has an accumulated deficit at december 31 , 2020 and december 31 , 2019 totaling $ 315.1 million and $ 263.5 million , respectively . as of december 31 , 2020 , and december 31 , 2019 the company had $ 50.8 million and $ 65.7 million aggregate principal amount outstanding on term loans and promissory notes , respectively . during 2020 , the company refinanced the existing $ 40.0 million term loans and received additional loan proceeds of $ 7.0 million from new senior secured term loans and $ 8.3 million from the u.s. government pursuant to the paycheck protection program under the cares act . in august and october 2020 , the company received a total of $ 10.0 million in loan proceeds from a convertible loan agreement , which was repaid along with other subordinated notes payable in connection with the merger . the company has used debt proceeds principally to fund general operations and acquisitions . in 2020 , the company invested $ 7.8 million ( net of cash acquired ) to acquire four companies , in a transaction accounted for as a business combination . ``` Suspicious Activity Report : we sell our software and services to companies using a variety of sales and marketing tactics . we have teams of inside sales representatives organized by vertical market who engage directly with companies . we have enterprise sales teams which target the large named accounts in each of our vertical markets . these teams are supported by a variety of typical software marketing tactics , including both digital , in-person ( such as trade shows and other events ) and content marketing . for consumers , porch largely relies on our unique and proprietary relationships with the approximately 11,000 companies using porch 's software to provide the company with end customer access and introductions . porch then utilizes technology , lifecycle marketing and teams in lower cost locations to operate as a moving concierge to assist these consumers with services . porch has invested in limited direct-to-consumer ( “ d2c ” ) marketing capabilities , but expects to become more advanced over time with capabilities such as digital and social retargeting . 47 key performance measures and operating metrics in the management of our businesses , we identify , measure and evaluate a variety of operating metrics . the key performance measures and operating metrics we use in managing our businesses are set forth below . these key performance measures and operating metrics are not prepared in accordance with gaap , and may not be comparable to or calculated in the same way as other similarly titled measures and metrics used by other companies . the key performance measures presented have been adjusted for divested porch businesses in 2018 through 2020 . ● average number of companies in quarter — porch provides software and services to home services companies and , through these relationships , gains unique and early access to homebuyers and homeowners , assists homebuyers and homeowners with critical services such as insurance and moving . porch ' s customers include home services companies , such as home inspectors , for whom porch provides software and services and who provide introductions to homebuyers and homeowners . porch tracks the average number of home services companies from which it generates revenue each quarter in order to measure our ability to attract , retain and grow our relationships with home services companies . management defines average companies in a quarter as the number of home services companies across all of porch ' s home services verticals that ( i ) had revenue contracts with us and ( ii ) generated revenue each month , averaged across a quarterly period . ● average revenue per account per month — management views porch ' s ability to increase revenue generated from existing customers as a key component of porch ' s growth strategy . average revenue per account per month in quarter is defined as the average revenue per month generated across all our home services company customer accounts in a quarterly period . average revenue per account per month in quarter are derived from all customers and total revenue ; not only customers and revenues associated with porch ' s referral network , the following table summarizes our average companies in quarter and average revenue per account per month for each of the quarterly periods indicated : ​ replace_table_token_1_th ​ ● number of monetized services in quarter — porch connects consumers with home services companies nationwide and offers a full range of products and services where homeowners can , among other things : ( i ) compare and buy home insurance policies ( along with auto , flood and umbrella policies ) with competitive rates and coverage ; ( ii ) arrange for a variety of services in connection with their move , from labor to load or unload a truck to full-service , long-distance moving services ; ( iii ) discover and install home automation and security systems ; ( iv ) compare internet and television options for their new home ; ( v ) book small handyman jobs at fixed , upfront prices with guaranteed quality ; and ( vi ) compare bids from home improvement professionals who can complete bigger jobs . porch tracks the number of monetized services performed through its platform each quarter and the revenue generated per service performed in order to measure to measure market penetration with homebuyers and homeowners and porch ' s ability to deliver high-revenue services within those groups . monetized services per quarter is defined as the total number of unique services from which we generated revenue , including , but not limited to , new insurance customers , completed moving jobs , security installations , tv/internet installations or other home projects , measured over a quarterly period . ● average revenue per monetized service — management believes that shifting the mix of services delivered to homebuyers and home owners toward higher revenue services is a key component of porch ' s growth strategy . average revenue per monetized services in quarter is the average revenue generated per monetized service performed in a quarterly period . when calculating average revenue per monetized service in quarter , average revenue is defined as total quarterly service transaction revenues generated from monetized services divided by three months . 48 the following table summarizes our monetized services and average revenue per monetized service for each of the quarterly periods indicated : ​ replace_table_token_2_th ​ in 2020 , the company shifted insurance monetization from getting paid per quote to earning multiyear insurance commissions , resulting in fewer monetized transactions with higher average revenue . in march 2020 , covid-19 impacted the service volumes during the period from march until june . the impact on service volumes , largely recovered by june 30 , 2020 and after adjusting for insurance monetization remains above prior year volumes . story_separator_special_tag 53 there are a variety of estimates in the black-scholes opinion pricing model , including the determination of the fair value of the company 's common stock , expected volatility , term , dividends and risk-free rate . prior to the close of the merger , we engaged an independent third-party valuation consultant to make periodic valuations of our class of common and preferred stock . the fair value of restricted stock awards is based on the value of the underlying stock , which is estimated periodically with assistance from the independent third-party valuation specialist using both market and income approaches . business combinations the company has engaged in mergers and acquisitions and intends to continue to make acquisitions a significant part of our growth strategy . the company made acquisitions with cash and non-cash consideration totaling $ 0.4 million in 2019 and $ 17.6 million in 2020. the company accounts for business acquisitions using the acquisition method of accounting and records any identifiable intangible assets separate from goodwill . intangible assets are recorded at their fair value based on estimates as of the date of acquisition . goodwill is recorded as the residual amount of the purchase price consideration less the fair value assigned to the individual identifiable assets acquired and liabilities assumed as of the date of acquisition . the accounting estimates associated with acquisitions are complex due to judgements and assumptions involved in determining ( 1 ) the total consideration paid because we have used cash , stock and earnouts and ( 2 ) the value of assets acquired and liabilities assumed . the company allocates the purchase price of the acquisition to the assets acquired and liabilities assumed based on estimates of the fair value at the dates of the acquisitions . contingent consideration , which represents an obligation of the company to make additional payments or equity interests to the former owner as part of the purchase price if specified future events occur or conditions are met , is accounted for at the acquisition date fair value either as a liability or as equity depending on the terms of the acquisition agreement . results of operations comparison of fiscal year ended december 31 , 2020 to fiscal year ended december 31 , 2019 the net loss in 2020 of $ 51.6 million compared with the net loss in 2019 of $ 103.3 million was impacted by a large , one-time stock-based compensation charge of $ 33.2 million related to the company 's ceo 2019 secondary stock sale transaction , 2019 losses on the remeasurement or extinguishment of debt and warrants that totaled $ 9.0 million , and a $ 5.0 million gain on a divestiture of a businesses in 2019 . 54 the following table sets forth our historical operating results for the periods indicated , with fiscal year 2019 incorporating operating results of since-divested businesses : ​ replace_table_token_3_th nm — percentage calculated is not meaningful . revenue total revenue decreased by $ 4.4 million , or 6 % from $ 77.6 million in the year ended december 31 , 2019 to $ 73.2 million in the year ended december 31 , 2020. revenue decreased by $ 17.7 million due to divested porch businesses , offset by increase in revenue in 2020 primarily driven by the growth in our moving services and insurance businesses , which contributed $ 13.8 million of the revenue increase in 2020. as porch has grown the number of companies that use our software and services , we have been able to grow our b2b2c ( “ business to business to consumer ” ) and move related services revenues . this includes revenues related to moving , insurance , tv/internet connections , and security . cost of revenue cost of revenue decreased by $ 3.9 million , or 18 % from $ 21.5 million in the year ended december 31 , 2019 to $ 17.6 million in the year ended december 31 , 2020. the decrease in the cost of revenue was mostly attributable to a $ 5.9 million of costs related to divested businesses , offset by growth in moving services . as a percentage of revenue , cost of revenue represented 24 % of revenue in 2020 compared to 28 % in 2019 . 55 selling and marketing selling and marketing expenses decreased by $ 14.4 million , or 26 % from $ 56.2 million in the year ended december 31 , 2019 to $ 41.8 million in the year ended december 31 , 2020. the decrease is due to $ 6.8 million related to divested businesses , $ 7.6 million mainly related to savings in third party data leads and marketing costs . the spend on data leads was optimized by focusing on the most productive lead sources that reduced overall spend and generated higher revenue . as a percentage of revenue , selling and marketing expenses represented 57 % of revenue in 2020 compared with 73 % in 2019 due to the economies of scale . product and technology product and technology expenses decreased by $ 2.7 million , or 9 % from $ 31 million in the year ended december 31 , 2019 to $ 28.3 million in the year ended december 31 , 2020. the $ 2.7 million decrease is due to divested businesses of $ 3.1 million , offset by growth in our moving group . as a percentage of revenue , product and technology expenses represented 39 % of revenue in 2020 compared with 40 % in 2019. general and administrative general and administrative expenses decreased by $ 23.6 million , or 45 % from $ 52 million in the year ended december 31 , 2019 to $ 28.4 million in the year ended december 31 , 2020 primarily due to a significantly higher stock-based compensation charge related to the 2019 secondary market transaction as indicated in the table below , offset by higher stock-based compensation related to employee awards in 2020. stock-based

special note regarding forward-looking statements all statements other than statements of historical fact included in this form 10-k including , without limitation , statements under “ management 's discussion and analysis of financial condition and results of operations ” regarding the company 's financial position , business strategy and the plans and objectives of management for future operations , are forward-looking statements . when used in this form 10-k , words such as “ anticipate , ” “ believe , ” “ estimate , ” “ expect , ” “ intend ” and similar expressions , as they relate to us or the company 's management , identify forward-looking statements . such forward-looking statements are based on the beliefs of management , as well as assumptions made by , and information currently available to , the company 's management . actual results could differ materially from those contemplated by the forward-looking statements as a result of certain factors detailed in our filings with the sec . overview we are a blank check company incorporated on may 19 , 2015 as a delaware corporation and formed for the purpose of effecting a merger , capital stock exchange , asset acquisition , stock purchase , reorganization or similar business combination with one or more businesses . we intend to effectuate our initial business combination using cash from the proceeds of our initial public offering that closed on august 4 , 2015 and a sale of warrants in a private placement that occurred simultaneously with the completion of our initial public offering , our capital stock , debt or a combination of cash , stock and debt . the issuance of additional shares of our stock in a business combination : ø may significantly dilute the equity interest of our stockholders ; ø may subordinate the rights of holders of common stock if preferred stock is issued with rights senior to those afforded to our common stock ; ø could cause a change of control if a substantial number of shares of our common stock are issued , which may affect , among other things , our ability to use our net operating loss carry forwards , if any , and could result in the resignation or removal of our present officers and directors ; ø may have the effect of delaying or preventing a change of control of us by diluting the stock ownership or voting rights of a person seeking to obtain control of us ; and ø may result in a decrease in the prevailing market prices for our common stock and or warrants . similarly , if we issue debt securities , it could result in : ø a decrease in the prevailing market prices for our common stock and or warrants ; ø default and foreclosure on our assets if our operating revenues after an initial business combination are insufficient to repay our debt obligations ; ø acceleration of our obligations to repay the indebtedness even if we make all principal and interest payments when due if we breach certain covenants that require the maintenance of certain financial ratios or reserves without a waiver or renegotiation of that covenant ; ø our immediate payment of all principal and accrued interest , if any , if the debt security is payable on demand ; ø our inability to obtain necessary additional financing if the debt security contains covenants restricting our ability to obtain such financing while the debt security is outstanding ; ø our inability to pay dividends on our common stock ; ø using a substantial portion of our cash flow to pay principal and interest on our debt , which will reduce the funds available for dividends on our common stock if declared , expenses , capital expenditures , acquisitions and other general corporate purposes ; ø limitations on our flexibility in planning for and reacting to changes in our business and in the industry in which we operate ; ø increased vulnerability to adverse changes in general economic , industry and competitive conditions and adverse changes in government regulation ; and limitations on our ability to borrow additional amounts for expenses , capital expenditures , acquisitions , debt service requirements , execution of our strategy and other purposes and other disadvantages compared to our competitors who have less debt . as indicated in the accompanying financial statements , at december 31 , 2015 , we had approximately $ 1,048,000 in cash . we expect to incur significant costs in the pursuit of our acquisition plans . we can not assure you that our plans to complete our initial business combination will be successful . 36 results of operations for the period from may 19 , 2015 ( inception ) through december 31 , 2015 our activities consisted of formation and preparation for our initial public offering and , subsequent to our initial public offering , locating and evaluating a suitable initial business combination candidate . as such , we had no operations or significant operating expenses until august 2015. our operating costs for the period from may 19 , 2015 ( inception ) through december 31 , 2015 , therefore , include our search for an initial business combination and are largely associated with our governance and public reporting , state franchise taxes of approximately $ 100,000 and charges of $ 10,000 per month from our sponsor for administrative services . story_separator_special_tag for the period from may 19 , 2015 ( inception ) through december 31 , 2015 our operating expenses totaled approximately $ 346,000 and we earned income of approximately $ 43,000 on our investment in u.s. government treasury bills in the trust account , resulting in a net loss of approximately $ 303,000 , or $ 0.07 per share , during the period . story_separator_special_tag during the period , plus to the extent dilutive the incremental number of shares of common stock to settle warrants , as calculated using the treasury stock method . at december 31 , 2015 , the company had outstanding warrants to purchase 14,170,000 shares of common stock . for all periods presented , these shares were excluded from the calculation of diluted loss per share of common stock because their inclusion would have been anti-dilutive the company had outstanding warrants to purchase 14,170,000 shares of common stock . for all periods presented , the weighted average of these shares was excluded from the calculation of diluted loss per share of common stock because their inclusion would have been anti-dilutive . as a result , diluted loss per common share is the same as basic loss per common share for the period . financial instruments the fair value of the company 's assets and liabilities , which qualify as financial instruments under fasb asc 820 , `` fair value measurements and disclosures , `` approximates the carrying amounts represented in the accompanying condensed balance sheets . offering costs the company complies with the requirements of the asc 340-10-s99-1 and sec staff accounting bulletin ( sab ) topic 5a— `` expenses of offering `` . offering costs of approximately $ 9,765,000 , consisting of underwriting discounts of $ 9,315,000 ( including approximately $ 4,658,000 of which payment is deferred ) and approximately $ 450,000 of professional , printing , filing , regulatory and other costs were charged to additional paid in capital upon the closing of our initial public offering on august 4 , 2015. income taxes the company follows the asset and liability method of accounting for income taxes under fasb asc , 740 , “ income taxes . ” deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statements carrying amounts of existing assets and liabilities and their respective tax bases . deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled . the effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that included the enactment date . valuation allowances are established , when necessary , to reduce deferred tax assets to the amount expected to be realized . at december 31 , 2015 the company has a deferred tax asset of approximately $ 100,000 related to net loss carryforwards ( which begin to expire in 2035 ) and start-up costs . management has determined that a full valuation allowance of the deferred tax asset is appropriate at this time . redeemable common stock all of the 15,525,000 shares of common stock sold as part of the units in our initial public offering contain a redemption feature which allows for the redemption of such common stock under the company 's liquidation or tender offer/stockholder approval provisions . in accordance with asc 480 , redemption provisions not solely within the control of the company require the security to be classified outside of permanent equity . ordinary liquidation events , which involve the redemption and liquidation of all of the entity 's equity instruments , are excluded from the provisions of asc 480. although the company does not specify a maximum redemption threshold , its amended and restated certificate of incorporation provides that in no event will the company redeem its public shares in an amount that would cause its net tangible assets ( stockholders ' equity ) to be less than $ 5,000,001. the company recognizes changes in redemption value immediately as they occur and adjusts the carrying value of the security to equal the redemption value at the end of each reporting period . increases or decreases in the carrying amount of redeemable common stock are affected by charges against additional paid-in capital . accordingly , at december 31 , 2015 , 14,661,512 of the 15,525,000 public shares were classified outside of permanent equity at their redemption value of $ 10.00 per share . recent accounting pronouncements the company complies with the reporting requirements of fasb asu no . 2014-10 , which eliminated certain financial reporting requirements of companies previously identified as “ development stage entities ” ( topic 915 ) . the amendments in this asu simplify accounting guidance by removing all incremental financial reporting requirements for development stage entities . the amendments also reduce date maintenance and , for those entities subject to audit , audit costs , by eliminating the requirements for development stage entities to present inception-to-date information in the statements of income , cash flows , and stockholders ' equity . upon adoption , entities will no longer present or disclose any information required by topic 915. for private entities and emerging growth companies under the jobs act , the amendments are effective for annual reporting periods beginning after december 15 , 2015. the company elected early adoption and has incorporated the methodologies prescribed by asu 2014-10 in the accompanying financial statements . 38 in august 2014 , the fasb issued asu 2014-15 , presentation of financial statements-going concern ( subtopic 205-40 ) : disclosure of uncertainties about an entity 's ability to continue as a going concern ( “ asu 2014-15 ” ) . asu 2014-15 provides guidance on management 's responsibility to evaluate whether there is substantial doubt about an organization 's ability to continue as a going concern and to provide related footnote

liquidity and capital resources on august 4 , 2015 , we consummated our initial public offering of an aggregate of 15,525,000 units ( including the full exercise of the underwriters ' overallotment option ) at a price of $ 10.00 per unit generating gross proceeds of approximately $ 155,250,000 before underwriting discounts and expenses . simultaneously with the consummation of our initial public offering , we consummated the private placement of 12,815,000 private placement warrants , each exercisable to purchase one-half of one share of our common stock at $ 5.75 per half share ( $ 11.50 per whole share ) , to our sponsor , at a price of $ 0.50 per private placement warrant , generating gross proceeds , before expenses , of approximately $ 6,408,000. we received net proceeds from our initial public offering and the sale of the private placement warrants of approximately $ 156,550,000 , net of the non-deferred portion of the underwriting commissions of approximately $ 4,658,000 and offering costs and other expenses of approximately $ 450,000 . $ 155,250,000 of the proceeds from our initial public offering and the private placement were deposited into the trust account and are not available to us for operations ( other than amounts identified for payment of taxes ) . at december 31 , 2015 , we had approximately $ 1,048,000 of cash available outside of the trust account to fund our activities to search for an initial business combination .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```liquidity and capital resources on august 4 , 2015 , we consummated our initial public offering of an aggregate of 15,525,000 units ( including the full exercise of the underwriters ' overallotment option ) at a price of $ 10.00 per unit generating gross proceeds of approximately $ 155,250,000 before underwriting discounts and expenses . simultaneously with the consummation of our initial public offering , we consummated the private placement of 12,815,000 private placement warrants , each exercisable to purchase one-half of one share of our common stock at $ 5.75 per half share ( $ 11.50 per whole share ) , to our sponsor , at a price of $ 0.50 per private placement warrant , generating gross proceeds , before expenses , of approximately $ 6,408,000. we received net proceeds from our initial public offering and the sale of the private placement warrants of approximately $ 156,550,000 , net of the non-deferred portion of the underwriting commissions of approximately $ 4,658,000 and offering costs and other expenses of approximately $ 450,000 . $ 155,250,000 of the proceeds from our initial public offering and the private placement were deposited into the trust account and are not available to us for operations ( other than amounts identified for payment of taxes ) . at december 31 , 2015 , we had approximately $ 1,048,000 of cash available outside of the trust account to fund our activities to search for an initial business combination . ``` Suspicious Activity Report : special note regarding forward-looking statements all statements other than statements of historical fact included in this form 10-k including , without limitation , statements under “ management 's discussion and analysis of financial condition and results of operations ” regarding the company 's financial position , business strategy and the plans and objectives of management for future operations , are forward-looking statements . when used in this form 10-k , words such as “ anticipate , ” “ believe , ” “ estimate , ” “ expect , ” “ intend ” and similar expressions , as they relate to us or the company 's management , identify forward-looking statements . such forward-looking statements are based on the beliefs of management , as well as assumptions made by , and information currently available to , the company 's management . actual results could differ materially from those contemplated by the forward-looking statements as a result of certain factors detailed in our filings with the sec . overview we are a blank check company incorporated on may 19 , 2015 as a delaware corporation and formed for the purpose of effecting a merger , capital stock exchange , asset acquisition , stock purchase , reorganization or similar business combination with one or more businesses . we intend to effectuate our initial business combination using cash from the proceeds of our initial public offering that closed on august 4 , 2015 and a sale of warrants in a private placement that occurred simultaneously with the completion of our initial public offering , our capital stock , debt or a combination of cash , stock and debt . the issuance of additional shares of our stock in a business combination : ø may significantly dilute the equity interest of our stockholders ; ø may subordinate the rights of holders of common stock if preferred stock is issued with rights senior to those afforded to our common stock ; ø could cause a change of control if a substantial number of shares of our common stock are issued , which may affect , among other things , our ability to use our net operating loss carry forwards , if any , and could result in the resignation or removal of our present officers and directors ; ø may have the effect of delaying or preventing a change of control of us by diluting the stock ownership or voting rights of a person seeking to obtain control of us ; and ø may result in a decrease in the prevailing market prices for our common stock and or warrants . similarly , if we issue debt securities , it could result in : ø a decrease in the prevailing market prices for our common stock and or warrants ; ø default and foreclosure on our assets if our operating revenues after an initial business combination are insufficient to repay our debt obligations ; ø acceleration of our obligations to repay the indebtedness even if we make all principal and interest payments when due if we breach certain covenants that require the maintenance of certain financial ratios or reserves without a waiver or renegotiation of that covenant ; ø our immediate payment of all principal and accrued interest , if any , if the debt security is payable on demand ; ø our inability to obtain necessary additional financing if the debt security contains covenants restricting our ability to obtain such financing while the debt security is outstanding ; ø our inability to pay dividends on our common stock ; ø using a substantial portion of our cash flow to pay principal and interest on our debt , which will reduce the funds available for dividends on our common stock if declared , expenses , capital expenditures , acquisitions and other general corporate purposes ; ø limitations on our flexibility in planning for and reacting to changes in our business and in the industry in which we operate ; ø increased vulnerability to adverse changes in general economic , industry and competitive conditions and adverse changes in government regulation ; and limitations on our ability to borrow additional amounts for expenses , capital expenditures , acquisitions , debt service requirements , execution of our strategy and other purposes and other disadvantages compared to our competitors who have less debt . as indicated in the accompanying financial statements , at december 31 , 2015 , we had approximately $ 1,048,000 in cash . we expect to incur significant costs in the pursuit of our acquisition plans . we can not assure you that our plans to complete our initial business combination will be successful . 36 results of operations for the period from may 19 , 2015 ( inception ) through december 31 , 2015 our activities consisted of formation and preparation for our initial public offering and , subsequent to our initial public offering , locating and evaluating a suitable initial business combination candidate . as such , we had no operations or significant operating expenses until august 2015. our operating costs for the period from may 19 , 2015 ( inception ) through december 31 , 2015 , therefore , include our search for an initial business combination and are largely associated with our governance and public reporting , state franchise taxes of approximately $ 100,000 and charges of $ 10,000 per month from our sponsor for administrative services . story_separator_special_tag for the period from may 19 , 2015 ( inception ) through december 31 , 2015 our operating expenses totaled approximately $ 346,000 and we earned income of approximately $ 43,000 on our investment in u.s. government treasury bills in the trust account , resulting in a net loss of approximately $ 303,000 , or $ 0.07 per share , during the period . story_separator_special_tag during the period , plus to the extent dilutive the incremental number of shares of common stock to settle warrants , as calculated using the treasury stock method . at december 31 , 2015 , the company had outstanding warrants to purchase 14,170,000 shares of common stock . for all periods presented , these shares were excluded from the calculation of diluted loss per share of common stock because their inclusion would have been anti-dilutive the company had outstanding warrants to purchase 14,170,000 shares of common stock . for all periods presented , the weighted average of these shares was excluded from the calculation of diluted loss per share of common stock because their inclusion would have been anti-dilutive . as a result , diluted loss per common share is the same as basic loss per common share for the period . financial instruments the fair value of the company 's assets and liabilities , which qualify as financial instruments under fasb asc 820 , `` fair value measurements and disclosures , `` approximates the carrying amounts represented in the accompanying condensed balance sheets . offering costs the company complies with the requirements of the asc 340-10-s99-1 and sec staff accounting bulletin ( sab ) topic 5a— `` expenses of offering `` . offering costs of approximately $ 9,765,000 , consisting of underwriting discounts of $ 9,315,000 ( including approximately $ 4,658,000 of which payment is deferred ) and approximately $ 450,000 of professional , printing , filing , regulatory and other costs were charged to additional paid in capital upon the closing of our initial public offering on august 4 , 2015. income taxes the company follows the asset and liability method of accounting for income taxes under fasb asc , 740 , “ income taxes . ” deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statements carrying amounts of existing assets and liabilities and their respective tax bases . deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled . the effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that included the enactment date . valuation allowances are established , when necessary , to reduce deferred tax assets to the amount expected to be realized . at december 31 , 2015 the company has a deferred tax asset of approximately $ 100,000 related to net loss carryforwards ( which begin to expire in 2035 ) and start-up costs . management has determined that a full valuation allowance of the deferred tax asset is appropriate at this time . redeemable common stock all of the 15,525,000 shares of common stock sold as part of the units in our initial public offering contain a redemption feature which allows for the redemption of such common stock under the company 's liquidation or tender offer/stockholder approval provisions . in accordance with asc 480 , redemption provisions not solely within the control of the company require the security to be classified outside of permanent equity . ordinary liquidation events , which involve the redemption and liquidation of all of the entity 's equity instruments , are excluded from the provisions of asc 480. although the company does not specify a maximum redemption threshold , its amended and restated certificate of incorporation provides that in no event will the company redeem its public shares in an amount that would cause its net tangible assets ( stockholders ' equity ) to be less than $ 5,000,001. the company recognizes changes in redemption value immediately as they occur and adjusts the carrying value of the security to equal the redemption value at the end of each reporting period . increases or decreases in the carrying amount of redeemable common stock are affected by charges against additional paid-in capital . accordingly , at december 31 , 2015 , 14,661,512 of the 15,525,000 public shares were classified outside of permanent equity at their redemption value of $ 10.00 per share . recent accounting pronouncements the company complies with the reporting requirements of fasb asu no . 2014-10 , which eliminated certain financial reporting requirements of companies previously identified as “ development stage entities ” ( topic 915 ) . the amendments in this asu simplify accounting guidance by removing all incremental financial reporting requirements for development stage entities . the amendments also reduce date maintenance and , for those entities subject to audit , audit costs , by eliminating the requirements for development stage entities to present inception-to-date information in the statements of income , cash flows , and stockholders ' equity . upon adoption , entities will no longer present or disclose any information required by topic 915. for private entities and emerging growth companies under the jobs act , the amendments are effective for annual reporting periods beginning after december 15 , 2015. the company elected early adoption and has incorporated the methodologies prescribed by asu 2014-10 in the accompanying financial statements . 38 in august 2014 , the fasb issued asu 2014-15 , presentation of financial statements-going concern ( subtopic 205-40 ) : disclosure of uncertainties about an entity 's ability to continue as a going concern ( “ asu 2014-15 ” ) . asu 2014-15 provides guidance on management 's responsibility to evaluate whether there is substantial doubt about an organization 's ability to continue as a going concern and to provide related footnote

as described in “ —management of market risk , ” we expect that our net interest income and our net economic value would decrease as a result of an instantaneous increase in interest rates . to help manage interest rate risk , we promote core deposit products and we are diversifying our loan portfolio by introducing new lending programs . see “ —business strategy ” , “ —management of market risk ” and “ risk factors—future changes in interest rates could reduce our profits and asset values . ” business strategy our goal is to provide long-term value to our stockholders , customers , employees and the communities we serve by executing a safe and sound business strategy that produces increasing earnings . we believe there is a significant opportunity for a community-focused , minority oriented bank to provide a full range of financial services to commercial and retail customers in our market area , and the increased capital we obtained as a result of the completion of the offering on september 29 , 2017 , will enable us to compete more effectively in the financial services marketplace . 48 our current business strategy consists of the following : continue to expand our multifamily and nonresidential loans . the additional capital raised in the stock offering has increased our capacity to originate multifamily and nonresidential loans . at december 31 , 2018 and december 31 , 2017 , multifamily and nonresidential loans ( not including loans secured by owner-occupied properties ) , together with construction and land loans , totaled $ 464.9 million and $ 372.7 million , or 313.1 % and 264.3 % , respectively , of total risk-based capital . under our current board approved loan concentration policy , such loans , including construction and land loans , shall not exceed 330 % of our total risk-based capital . most multifamily and nonresidential loans are originated with adjustable rates and , as a result , these loans are expected to increase loan yields with shorter repricing terms than fixed-rate loans . multifamily and nonresidential loan originations increased during the year ended december 31 , 2018 by $ 31.8 million , or 29.5 % , when compared to the same period in 2017. introduce new community lending programs . in 2017 the bank was approved as an authorized direct lender under the small business administration ( sba ) and in 2018 as a community development financial institution ( cdfi ) . the addition of both of these programs combined with its existing products will bolster the bank 's commitment to continue to serve the communities that it has supported over the past almost sixty years . continue to increase core deposits , with an emphasis on low cost commercial demand deposits , and add non-core funding sources . deposits are the major source of balance sheet funding for lending and other investments . we have made significant investments in new products and services , personnel , branch distribution system as well as enhancing our electronic delivery solutions in an effort to become more competitive in the financial services marketplace and attract more core deposits . core deposits are our least costly source of funds and represent our best opportunity to develop customer relationships that enable us to cross-sell our enhanced products and services . total deposits increased by $ 95.8 million , or 13.4 % , to $ 809.8 million at december 31 , 2018 compared to $ 714.0 million at december 31 , 2017. the majority of the increase was due to an increase of $ 14.0 million , or 3.4 % , in certificates of deposit accounts , $ 12.9 million , or 12.5 % , in demand deposits and $ 68.8 million , or 34.3 % , in other interest bearing deposits , which consist of money markets , now and savings accounts . certificates of deposit accounted for 52.4 % and 57.4 % of total deposits at december 31 , 2018 and december 31 , 2017 , respectively . while we will continue to use certificates of deposit as a funding source , our goal is to continue to reduce our reliance on this source of funding as we grow our core deposit base . manage credit risk to maintain a low level of nonperforming assets . we believe strong asset quality is a key to our long-term financial success . our strategy for credit risk management focuses on having an experienced team of credit professionals , well-defined policies and procedures , appropriate loan underwriting criteria and active credit monitoring . our non-performing assets to total assets ratio was 0.64 % at december 31 , 2018 , 1.23 % at december 31 , 2017 and 1.04 % at december 31 , 2016. the majority of our non-performing assets have been related , largely , to one-to-four family and , to a lesser extent , construction and land loans , as our residential borrowers experienced difficulties repaying their loans during the past recession . we have increased our investment in our credit review function , both in personnel as well as ancillary systems , in order to be able to evaluate more complex loans and better manage credit risk , to further support our intended loan growth . expand our employee base to support future growth . we have already made significant investments in our employee base . however , we will continue to work to attract and retain the necessary talent to support increased lending , deposit activities and enhanced information technology . grow organically and through opportunistic bank or branch acquisitions . we expect to focus primarily on organic growth as a lower-risk means of deploying our acquired capital . the capital raised also will help fund improvements in our operating facilities and customer delivery services in order to enhance our competitiveness . story_separator_special_tag total stockholders ' equity increased $ 4.4 million , or 2.7 % , to $ 169.2 million at december 31 , 2018 , from $ 164.8 million at december 31 , 2017. the increase was substantially due to net income of $ 2.7 million , a decrease of $ 1.0 million in accumulated other comprehensive loss related primarily to the defined benefit pension plan , and the release of esop shares of $ 615,000. comparison of operating results for the years ended december 31 , 2018 and 2017 general . consolidated net income for the year ended december 31 , 2018 , was $ 2.7 million compared to a net loss of $ 4.4 million for the year ended december 31 , 2017. the increase was primarily attributed to an increase of $ 4.9 million in net interest income after the provision for loan losses and by decreases of $ 2.0 million to non-interest expense and of $ 166,000 in non-interest income . interest income . interest and dividend income increased $ 7.2 million , or 18.4 % , to $ 46.2 million for the year ended december 31 , 2018 , from $ 39.0 million for the year ended december 31 , 2017. the increase was primarily due to a $ 6.8 million , or 17.8 % , increase in interest income on loans , which is our primary source of interest income . average loan balances increased $ 131.5 million , or 17.9 % , to $ 867.0 million for the year ended december 31 , 2018 from $ 735.6 million for the year ended december 31 , 2017. the increase in average loan balances was mainly driven by increases in the multifamily mortgage , nonresidential mortgage , one-to-four family mortgage , and construction and land loan portfolios . the average yield on loans decreased 1 basis point to 5.18 % for the year ended december 31 , 2018 from 5.19 % for the year ended december 31 , 2017. interest and dividend income on investment securities and federal home loan bank of new york stock increased $ 391,000 , or 47.9 % , to $ 1.2 million for the year ended december 31 , 2018 from $ 817,000 for the year ended december 31 , 2017. the yield on investment securities and federal home loan bank of new york stock increased 42 basis points to 1.74 % for the year ended december 31 , 2018 , from 1.33 % for the year ended december 31 , 2017. the average balance of investment securities and federal home loan bank of new york stock increased $ 3.8 million , or 5.8 % , to $ 69.4 million for the year ended december 31 , 2018 , from $ 65.5 million for the year ended december 31 , 2017. interest expense . interest expense increased $ 2.7 million , or 39.9 % , to $ 9.5 million for the year ended december 31 , 2018 , from $ 6.8 million for the year ended december 31 , 2017. the increase was the result of an overall increase in interest expense on certificates of deposit , savings and money markets , and interest expense on borrowings . specifically , interest expense on certificates of deposit increased $ 1.7 million , or 28.7 % , to $ 7.6 million for the year ended december 31 , 2018 , from $ 5.9 million for the year ended december 31 , 2017. this increase resulted from increases in both the average balance of certificates of deposit and the average rate we paid on certificates of deposit . the average balance of certificates of deposit increased $ 52.5 million , or 13.6 % , to $ 439.7 million for the year ended december 31 , 2018 from $ 387.2 million for the year ended december 31 , 2017 , and the average rate we paid on certificates of deposit increased 20 basis points to 1.73 % for the year ended december 31 , 2018 , from 1.53 % for the year ended december 31 , 2017. interest expense on other deposits and borrowings increased $ 1.0 million to $ 1.9 million for the year ended december 31 , 2018 from $ 866,000 for the year ended december 31 , 2017. this increase resulted from an increase in the average rate we paid on other deposits and borrowings . the average balance of other deposits and borrowings increased $ 28.6 million , or 12.8 % , to $ 256.3 million for the year ended december 31 , 2018 , from $ 227.7 million for the year ended december 31 , 2017 , and the average rate we paid on other deposits and borrowings increased 33 basis points to 0.73 % 53 for the year ended december 31 , 2018 , from 0.40 % for the year ended december 31 , 2017 , reflecting higher market interest rates . net interest income . net interest income increased $ 4.5 million , or 13.8 % , to $ 36.7 million for the year ended december 31 , 2018 from $ 32.2 million for the year ended december 31 , 2017 , primarily as a result of higher market yields on earning assets . our average net interest-earning assets increased by $ 53.8 million , or 28.9 % , to $ 240.3 million for the year ended december 31 , 2018 , from $ 186.1 million for the year ended december 31 , 2017 , due primarily to our loan growth , described above . our net interest rate spread decreased by 19 basis points , to 3.57 % , for the year ended december 31 , 2018 , from 3.76 % for the year ended december 31 , 2017 , and our net interest margin was 3.92 % and 4.02 % for the years ended december 31 , 2018 and 2017 , respectively . an increase in interest rates will present us with a challenge in managing our

liquidity and capital resources liquidity describes our ability to meet the financial obligations that arise in the ordinary course of business . liquidity is primarily needed to meet the borrowing and deposit withdrawal requirements of our customers and to fund current and planned expenditures . our primary sources of funds are deposits , principal and interest payments on loans and securities and proceeds from the sale of loans . we also have the ability to borrow from the federal home loan bank of new york . at december 31 , 2018 and 2017 , we had $ 44.4 million and $ 16.4 million , respectively , of term and overnight outstanding advances from the federal home loan bank of new york , and also had a guarantee from the federal home loan bank of new york through a standby letter of credit of $ 7.6 million . at december 31 , 2018 , we had eligible collateral of approximately $ 280.4 million in mortgage loans available to secure advances from the federal home loan bank of new york . we also have an unsecured line of credit of $ 25.0 million outstanding with zions bank , of which $ 25.0 million was outstanding at december 31 , 2018. we did not have any outstanding securities sold under repurchase agreements with brokers as of december 31 , 2018 and 2017. although maturities and scheduled amortization of loans and securities are predictable sources of funds , deposit flows and loan prepayments are greatly influenced by general interest rates , economic conditions , and competition .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```liquidity and capital resources liquidity describes our ability to meet the financial obligations that arise in the ordinary course of business . liquidity is primarily needed to meet the borrowing and deposit withdrawal requirements of our customers and to fund current and planned expenditures . our primary sources of funds are deposits , principal and interest payments on loans and securities and proceeds from the sale of loans . we also have the ability to borrow from the federal home loan bank of new york . at december 31 , 2018 and 2017 , we had $ 44.4 million and $ 16.4 million , respectively , of term and overnight outstanding advances from the federal home loan bank of new york , and also had a guarantee from the federal home loan bank of new york through a standby letter of credit of $ 7.6 million . at december 31 , 2018 , we had eligible collateral of approximately $ 280.4 million in mortgage loans available to secure advances from the federal home loan bank of new york . we also have an unsecured line of credit of $ 25.0 million outstanding with zions bank , of which $ 25.0 million was outstanding at december 31 , 2018. we did not have any outstanding securities sold under repurchase agreements with brokers as of december 31 , 2018 and 2017. although maturities and scheduled amortization of loans and securities are predictable sources of funds , deposit flows and loan prepayments are greatly influenced by general interest rates , economic conditions , and competition . ``` Suspicious Activity Report : as described in “ —management of market risk , ” we expect that our net interest income and our net economic value would decrease as a result of an instantaneous increase in interest rates . to help manage interest rate risk , we promote core deposit products and we are diversifying our loan portfolio by introducing new lending programs . see “ —business strategy ” , “ —management of market risk ” and “ risk factors—future changes in interest rates could reduce our profits and asset values . ” business strategy our goal is to provide long-term value to our stockholders , customers , employees and the communities we serve by executing a safe and sound business strategy that produces increasing earnings . we believe there is a significant opportunity for a community-focused , minority oriented bank to provide a full range of financial services to commercial and retail customers in our market area , and the increased capital we obtained as a result of the completion of the offering on september 29 , 2017 , will enable us to compete more effectively in the financial services marketplace . 48 our current business strategy consists of the following : continue to expand our multifamily and nonresidential loans . the additional capital raised in the stock offering has increased our capacity to originate multifamily and nonresidential loans . at december 31 , 2018 and december 31 , 2017 , multifamily and nonresidential loans ( not including loans secured by owner-occupied properties ) , together with construction and land loans , totaled $ 464.9 million and $ 372.7 million , or 313.1 % and 264.3 % , respectively , of total risk-based capital . under our current board approved loan concentration policy , such loans , including construction and land loans , shall not exceed 330 % of our total risk-based capital . most multifamily and nonresidential loans are originated with adjustable rates and , as a result , these loans are expected to increase loan yields with shorter repricing terms than fixed-rate loans . multifamily and nonresidential loan originations increased during the year ended december 31 , 2018 by $ 31.8 million , or 29.5 % , when compared to the same period in 2017. introduce new community lending programs . in 2017 the bank was approved as an authorized direct lender under the small business administration ( sba ) and in 2018 as a community development financial institution ( cdfi ) . the addition of both of these programs combined with its existing products will bolster the bank 's commitment to continue to serve the communities that it has supported over the past almost sixty years . continue to increase core deposits , with an emphasis on low cost commercial demand deposits , and add non-core funding sources . deposits are the major source of balance sheet funding for lending and other investments . we have made significant investments in new products and services , personnel , branch distribution system as well as enhancing our electronic delivery solutions in an effort to become more competitive in the financial services marketplace and attract more core deposits . core deposits are our least costly source of funds and represent our best opportunity to develop customer relationships that enable us to cross-sell our enhanced products and services . total deposits increased by $ 95.8 million , or 13.4 % , to $ 809.8 million at december 31 , 2018 compared to $ 714.0 million at december 31 , 2017. the majority of the increase was due to an increase of $ 14.0 million , or 3.4 % , in certificates of deposit accounts , $ 12.9 million , or 12.5 % , in demand deposits and $ 68.8 million , or 34.3 % , in other interest bearing deposits , which consist of money markets , now and savings accounts . certificates of deposit accounted for 52.4 % and 57.4 % of total deposits at december 31 , 2018 and december 31 , 2017 , respectively . while we will continue to use certificates of deposit as a funding source , our goal is to continue to reduce our reliance on this source of funding as we grow our core deposit base . manage credit risk to maintain a low level of nonperforming assets . we believe strong asset quality is a key to our long-term financial success . our strategy for credit risk management focuses on having an experienced team of credit professionals , well-defined policies and procedures , appropriate loan underwriting criteria and active credit monitoring . our non-performing assets to total assets ratio was 0.64 % at december 31 , 2018 , 1.23 % at december 31 , 2017 and 1.04 % at december 31 , 2016. the majority of our non-performing assets have been related , largely , to one-to-four family and , to a lesser extent , construction and land loans , as our residential borrowers experienced difficulties repaying their loans during the past recession . we have increased our investment in our credit review function , both in personnel as well as ancillary systems , in order to be able to evaluate more complex loans and better manage credit risk , to further support our intended loan growth . expand our employee base to support future growth . we have already made significant investments in our employee base . however , we will continue to work to attract and retain the necessary talent to support increased lending , deposit activities and enhanced information technology . grow organically and through opportunistic bank or branch acquisitions . we expect to focus primarily on organic growth as a lower-risk means of deploying our acquired capital . the capital raised also will help fund improvements in our operating facilities and customer delivery services in order to enhance our competitiveness . story_separator_special_tag total stockholders ' equity increased $ 4.4 million , or 2.7 % , to $ 169.2 million at december 31 , 2018 , from $ 164.8 million at december 31 , 2017. the increase was substantially due to net income of $ 2.7 million , a decrease of $ 1.0 million in accumulated other comprehensive loss related primarily to the defined benefit pension plan , and the release of esop shares of $ 615,000. comparison of operating results for the years ended december 31 , 2018 and 2017 general . consolidated net income for the year ended december 31 , 2018 , was $ 2.7 million compared to a net loss of $ 4.4 million for the year ended december 31 , 2017. the increase was primarily attributed to an increase of $ 4.9 million in net interest income after the provision for loan losses and by decreases of $ 2.0 million to non-interest expense and of $ 166,000 in non-interest income . interest income . interest and dividend income increased $ 7.2 million , or 18.4 % , to $ 46.2 million for the year ended december 31 , 2018 , from $ 39.0 million for the year ended december 31 , 2017. the increase was primarily due to a $ 6.8 million , or 17.8 % , increase in interest income on loans , which is our primary source of interest income . average loan balances increased $ 131.5 million , or 17.9 % , to $ 867.0 million for the year ended december 31 , 2018 from $ 735.6 million for the year ended december 31 , 2017. the increase in average loan balances was mainly driven by increases in the multifamily mortgage , nonresidential mortgage , one-to-four family mortgage , and construction and land loan portfolios . the average yield on loans decreased 1 basis point to 5.18 % for the year ended december 31 , 2018 from 5.19 % for the year ended december 31 , 2017. interest and dividend income on investment securities and federal home loan bank of new york stock increased $ 391,000 , or 47.9 % , to $ 1.2 million for the year ended december 31 , 2018 from $ 817,000 for the year ended december 31 , 2017. the yield on investment securities and federal home loan bank of new york stock increased 42 basis points to 1.74 % for the year ended december 31 , 2018 , from 1.33 % for the year ended december 31 , 2017. the average balance of investment securities and federal home loan bank of new york stock increased $ 3.8 million , or 5.8 % , to $ 69.4 million for the year ended december 31 , 2018 , from $ 65.5 million for the year ended december 31 , 2017. interest expense . interest expense increased $ 2.7 million , or 39.9 % , to $ 9.5 million for the year ended december 31 , 2018 , from $ 6.8 million for the year ended december 31 , 2017. the increase was the result of an overall increase in interest expense on certificates of deposit , savings and money markets , and interest expense on borrowings . specifically , interest expense on certificates of deposit increased $ 1.7 million , or 28.7 % , to $ 7.6 million for the year ended december 31 , 2018 , from $ 5.9 million for the year ended december 31 , 2017. this increase resulted from increases in both the average balance of certificates of deposit and the average rate we paid on certificates of deposit . the average balance of certificates of deposit increased $ 52.5 million , or 13.6 % , to $ 439.7 million for the year ended december 31 , 2018 from $ 387.2 million for the year ended december 31 , 2017 , and the average rate we paid on certificates of deposit increased 20 basis points to 1.73 % for the year ended december 31 , 2018 , from 1.53 % for the year ended december 31 , 2017. interest expense on other deposits and borrowings increased $ 1.0 million to $ 1.9 million for the year ended december 31 , 2018 from $ 866,000 for the year ended december 31 , 2017. this increase resulted from an increase in the average rate we paid on other deposits and borrowings . the average balance of other deposits and borrowings increased $ 28.6 million , or 12.8 % , to $ 256.3 million for the year ended december 31 , 2018 , from $ 227.7 million for the year ended december 31 , 2017 , and the average rate we paid on other deposits and borrowings increased 33 basis points to 0.73 % 53 for the year ended december 31 , 2018 , from 0.40 % for the year ended december 31 , 2017 , reflecting higher market interest rates . net interest income . net interest income increased $ 4.5 million , or 13.8 % , to $ 36.7 million for the year ended december 31 , 2018 from $ 32.2 million for the year ended december 31 , 2017 , primarily as a result of higher market yields on earning assets . our average net interest-earning assets increased by $ 53.8 million , or 28.9 % , to $ 240.3 million for the year ended december 31 , 2018 , from $ 186.1 million for the year ended december 31 , 2017 , due primarily to our loan growth , described above . our net interest rate spread decreased by 19 basis points , to 3.57 % , for the year ended december 31 , 2018 , from 3.76 % for the year ended december 31 , 2017 , and our net interest margin was 3.92 % and 4.02 % for the years ended december 31 , 2018 and 2017 , respectively . an increase in interest rates will present us with a challenge in managing our

the ongoing covid-19 surge , coupled alongside vaccine rollout logistics , likely indicate that our country and national healthcare system will be under some amount of continued strain over the coming months . that said , we continue to be encouraged as we witness meaningful evidence that the healthcare provider ecosystem is significantly better equipped and prepared to respond to the ongoing pandemic , including through its treatment efficacy , supply chain logistics , capacity planning , and broader operational optimization . lastly , we see additional reasons for optimism over the near-to-medium term , as we begin to witness early signs of progress on vaccine rollout logistics . we are fortunate to have a highly recurring revenue model in which greater than 90 % of our revenue is recurring in nature . as such , we expect that the near-term impact of covid-19 on our total revenue will be relatively muted , as evidenced by our revenue performance for the year ended december 31 , 2020. additionally , we benefit from a high level of technology revenue predictability , especially our dos subscription customers that typically have built-in , contractual technology revenue escalators . we also have developed a number of technology and services solutions designed specifically to support healthcare providers during the covid-19 pandemic . importantly , since the onset of the covid-19 pandemic , our customers ' overall usage of our data platform has increased meaningfully . additionally , we have seen usage of our covid-19-specific products shift from those focused on covid-19 preparedness to those focused on financial recovery and planning analytics in areas such as elective procedures , ambulatory care , and revenue cycle . given these factors , we have seen minimal impact on our technology dollar-based retention as a result of covid-19 and would anticipate similar dynamics moving forward . regarding our professional services , we continue to see high levels of engagement of our team member base , who remain engaged on both covid-19-recovery work as well as focusing on more general clinical , financial , and operational improvement work . that said , the financial strain imposed by covid-19 on a number of our customers has led to a meaningfully lower professional services dollar-based retention than we have achieved historically . the primary drivers for the decrease in our adjusted professional services gross margin from 35 % for the year ended december 31 , 2019 to 25 % for the year ended december 31 , 2020 include the lower professional services dollar-based retention mentioned above , temporary professional services discounts provided to support our customers through the near-term financial strain they have experienced related to covid-19 , as well as some shift in the mix of professional services delivered . we added nine net new dos subscription customers during the year ended december 31 , 2020. in the first half of 2020 , given the significant impact of covid-19 on our healthcare provider end market , the number of first half new customer additions was meaningfully lower than we originally anticipated entering the year . as we entered the second half of 2020 , we were pleased to see healthcare organizations adjusting well to the `` new normal `` operating environment , with covid-19 highlighting the need for a more robust , commercial-grade data and analytics solution . likewise , given the financial strain imposed by the pandemic , prospective customers have shown an increased focus on revenue and cost optimization analytics , from which we believe we are well positioned to benefit . on the other hand , the covid-19 pandemic continued to create some near-term financial uncertainty , making some health systems more cautious in their near-term purchasing decisions . given these operating dynamics , in the second half of 2020 we experienced similar overall pipeline conversion rates to the second half of 2019. any negative impact to 2020 total revenue caused by the covid-19 pandemic has also resulted in a negative impact to our 2020 adjusted ebitda . we have and continue to plan to partially offset any negative total revenue impact through cost containment efforts , resulting in less of a negative adjusted ebitda impact compared to the negative total revenue impact . importantly , in our response to the covid-19 pandemic , we remain centrally committed to our team members , ensuring they stay at the center of the health catalyst flywheel . as such , any cost containment efforts implemented will have a bias towards non-headcount related items . over the long run , as we get through the covid-19 pandemic and healthcare organizations ' operations begin to normalize , we continue to be optimistic that the pandemic will serve as an overall tailwind in the industry 's adoption of data and analytics . at the health system level , we are seeing meaningful evidence that covid-19 is highlighting the need for a commercial-grade data and analytics solution to replace patchwork homegrown systems . 62 our business model we offer our solution to a variety of healthcare organizations , primarily in the united states , including academic medical centers , integrated delivery networks , community hospitals , large physician practices , acos , health information exchanges , health insurers , and other risk-bearing entities . we categorize our customer count into two primary categories : dos subscription customers and other customers . dos subscription customers are defined as customers who access our dos platform via a technology subscription contract . other customers generally include dos non-subscription customers and other customers from historical acquisitions . as of december 31 , 2020 , 2019 , and 2018 , we had 74 , 65 , and 50 dos subscription customers with active subscriptions , respectively . story_separator_special_tag components of our results of operations revenue we derive our revenue from sales of technology and professional services . for the years ended december 31 , 2020 , 2019 , and 2018 , technology revenue represented 58 % , 54 % , and 51 % of total revenue , respectively , and professional services revenue represented 42 % , 46 % , and 49 % of total revenue , respectively . technology revenue . technology revenue primarily consists of subscription fees charged to customers for access to use our data platform and analytics applications . we provide customers access to our technology through either an all-access or limited-access , modular subscription . most of our subscription contracts are cloud-based and have up to a three-year term , of which the vast majority are terminable after one year upon 90 days ' notice . dos subscription customers that access our technology through an all-access or limited access , modular subscription generally have agreements with built-in annual escalators for technology access fees . also included in technology revenue is the maintenance and support we provide , which generally includes updates and support services . professional services revenue . professional services revenue primarily includes analytics services , domain expertise services , outsourcing services , and implementation services . professional services arrangements typically include a fee for making full-time equivalent ( fte ) services available to our customers on a monthly basis . fte services generally consist of a blend of analytic engineers , analysts , and data scientists based on the domain expertise needed to best serve our customers . 67 deferred revenue deferred revenue consists of customer billings in advance of revenue being recognized from our technology and professional services arrangements . we primarily invoice our customers for technology arrangements annually or quarterly in advance . amounts anticipated to be recognized within one year of the balance sheet date are recorded as deferred revenue and the remaining portion is recorded as deferred revenue , net of current portion on the consolidated balance sheets . cost of revenue , excluding depreciation and amortization cost of technology revenue . cost of technology revenue primarily consists of costs associated with hosting and supporting our technology , including third-party cloud computing and hosting costs , contractor costs , and salary and related personnel costs for our cloud services and support teams . although we expect cost of technology revenue to increase in absolute dollars as we transition customers to third-party hosted data centers with microsoft azure and increase headcount to accommodate growth , we anticipate cost of technology revenue as a percentage of technology revenue will generally decrease over the long term . we expect cost of technology revenue as a percentage of technology revenue to fluctuate and potentially increase in the near term , primarily due to additional costs associated with transitioning customers from on-premise and our managed data centers to microsoft azure . cost of professional services revenue . cost of professional services revenue consists primarily of costs related to delivering our team 's expertise in analytics , strategic advisory , improvement , and implementation services . these costs primarily include salary and related personnel costs , travel-related costs , and outside contractor costs . we expect cost of professional services revenue to increase in absolute dollars as we increase headcount to accommodate growth . operating expense sales and marketing . sales and marketing expenses primarily include salary and related personnel costs for our sales , marketing , and account management teams , lead generation , marketing events , including our healthcare analytics summit ( has ) , marketing programs , and outside contractor costs associated with the sale and marketing of our offerings . we plan to continue to invest in sales and marketing to grow our customer base , expand in new markets , and increase our brand awareness . the trend and timing of sales and marketing expenses will depend in part on the timing of our expansion into new markets and marketing campaigns . we expect that sales and marketing expenses will increase in absolute dollars in future periods , but decrease as a percentage of our revenue over the long term . our sales and marketing expenses may fluctuate as a percentage of our revenue from period to period due to the timing and extent of these expenses . research and development . research and development expenses primarily include salary and related personnel costs for our data platform and analytics applications teams , subscriptions , and outside contractor costs associated with the development of products . we have developed an open , flexible , and scalable data platform . we plan to continue to invest in research and development to develop new solutions and enhance our applications library . we expect that research and development expenses will increase in absolute dollars in future periods , but decrease as a percentage of our revenue over the long term . our research and development expenses may fluctuate as a percentage of our revenue from period to period due to the timing and extent of these expenses . general and administrative . general and administrative expenses primarily include salary and related personnel costs for our legal , finance , people operations , it , and other administrative teams , including certain executives . general and administrative expenses also include facilities , subscriptions , corporate insurance , outside legal , accounting , and directors ' fees . due to the closing of our ipo on july 29 , 2019 , we incurred and expect to continue to incur additional costs as a result of operating as a public company , including costs related to compliance and reporting obligations of public companies , and increased costs for insurance , investor relations , and corporate governance . as a result , we expect our general and administrative expenses to increase in absolute dollars for the foreseeable future , but decrease as a percentage of our

cash flows the following table summarizes our cash flows for the years ended december 31 , 2020 , 2019 , and 2018 : replace_table_token_29_th operating activities our largest source of operating cash flows is cash collections from our customers for technology and professional services arrangements . our primary uses of cash from operating activities are for employee-related expenses , marketing expenses , and technology costs . for the year ended december 31 , 2020 , net cash used in operating activities was $ 26.1 million , which included a net loss of $ 115.0 million . non-cash charges primarily consisted of $ 18.7 million in depreciation and amortization of property , equipment , and intangible assets , $ 38.0 million in stock-based compensation , $ 14.1 million in change in fair value of contingent consideration liabilities , $ 8.5 million of loss from the extinguishment of debt , and $ 8.1 million in amortization of debt discount and issuance costs . for the year ended december 31 , 2019 , net cash used in operating activities was $ 32.2 million , which included a net loss of $ 60.1 million . non-cash charges primarily consisted of $ 9.2 million in depreciation and amortization of property , equipment , and intangible assets , $ 17.8 million in stock-based compensation , $ 1.7 million of loss from the extinguishment of debt , and $ 1.1 million in amortization of debt discount and issuance costs . 77 for the year ended december 31 , 2018 , net cash used in operating activities was $ 40.3 million , which included a net loss of $ 62.0 million .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```cash flows the following table summarizes our cash flows for the years ended december 31 , 2020 , 2019 , and 2018 : replace_table_token_29_th operating activities our largest source of operating cash flows is cash collections from our customers for technology and professional services arrangements . our primary uses of cash from operating activities are for employee-related expenses , marketing expenses , and technology costs . for the year ended december 31 , 2020 , net cash used in operating activities was $ 26.1 million , which included a net loss of $ 115.0 million . non-cash charges primarily consisted of $ 18.7 million in depreciation and amortization of property , equipment , and intangible assets , $ 38.0 million in stock-based compensation , $ 14.1 million in change in fair value of contingent consideration liabilities , $ 8.5 million of loss from the extinguishment of debt , and $ 8.1 million in amortization of debt discount and issuance costs . for the year ended december 31 , 2019 , net cash used in operating activities was $ 32.2 million , which included a net loss of $ 60.1 million . non-cash charges primarily consisted of $ 9.2 million in depreciation and amortization of property , equipment , and intangible assets , $ 17.8 million in stock-based compensation , $ 1.7 million of loss from the extinguishment of debt , and $ 1.1 million in amortization of debt discount and issuance costs . 77 for the year ended december 31 , 2018 , net cash used in operating activities was $ 40.3 million , which included a net loss of $ 62.0 million . ``` Suspicious Activity Report : the ongoing covid-19 surge , coupled alongside vaccine rollout logistics , likely indicate that our country and national healthcare system will be under some amount of continued strain over the coming months . that said , we continue to be encouraged as we witness meaningful evidence that the healthcare provider ecosystem is significantly better equipped and prepared to respond to the ongoing pandemic , including through its treatment efficacy , supply chain logistics , capacity planning , and broader operational optimization . lastly , we see additional reasons for optimism over the near-to-medium term , as we begin to witness early signs of progress on vaccine rollout logistics . we are fortunate to have a highly recurring revenue model in which greater than 90 % of our revenue is recurring in nature . as such , we expect that the near-term impact of covid-19 on our total revenue will be relatively muted , as evidenced by our revenue performance for the year ended december 31 , 2020. additionally , we benefit from a high level of technology revenue predictability , especially our dos subscription customers that typically have built-in , contractual technology revenue escalators . we also have developed a number of technology and services solutions designed specifically to support healthcare providers during the covid-19 pandemic . importantly , since the onset of the covid-19 pandemic , our customers ' overall usage of our data platform has increased meaningfully . additionally , we have seen usage of our covid-19-specific products shift from those focused on covid-19 preparedness to those focused on financial recovery and planning analytics in areas such as elective procedures , ambulatory care , and revenue cycle . given these factors , we have seen minimal impact on our technology dollar-based retention as a result of covid-19 and would anticipate similar dynamics moving forward . regarding our professional services , we continue to see high levels of engagement of our team member base , who remain engaged on both covid-19-recovery work as well as focusing on more general clinical , financial , and operational improvement work . that said , the financial strain imposed by covid-19 on a number of our customers has led to a meaningfully lower professional services dollar-based retention than we have achieved historically . the primary drivers for the decrease in our adjusted professional services gross margin from 35 % for the year ended december 31 , 2019 to 25 % for the year ended december 31 , 2020 include the lower professional services dollar-based retention mentioned above , temporary professional services discounts provided to support our customers through the near-term financial strain they have experienced related to covid-19 , as well as some shift in the mix of professional services delivered . we added nine net new dos subscription customers during the year ended december 31 , 2020. in the first half of 2020 , given the significant impact of covid-19 on our healthcare provider end market , the number of first half new customer additions was meaningfully lower than we originally anticipated entering the year . as we entered the second half of 2020 , we were pleased to see healthcare organizations adjusting well to the `` new normal `` operating environment , with covid-19 highlighting the need for a more robust , commercial-grade data and analytics solution . likewise , given the financial strain imposed by the pandemic , prospective customers have shown an increased focus on revenue and cost optimization analytics , from which we believe we are well positioned to benefit . on the other hand , the covid-19 pandemic continued to create some near-term financial uncertainty , making some health systems more cautious in their near-term purchasing decisions . given these operating dynamics , in the second half of 2020 we experienced similar overall pipeline conversion rates to the second half of 2019. any negative impact to 2020 total revenue caused by the covid-19 pandemic has also resulted in a negative impact to our 2020 adjusted ebitda . we have and continue to plan to partially offset any negative total revenue impact through cost containment efforts , resulting in less of a negative adjusted ebitda impact compared to the negative total revenue impact . importantly , in our response to the covid-19 pandemic , we remain centrally committed to our team members , ensuring they stay at the center of the health catalyst flywheel . as such , any cost containment efforts implemented will have a bias towards non-headcount related items . over the long run , as we get through the covid-19 pandemic and healthcare organizations ' operations begin to normalize , we continue to be optimistic that the pandemic will serve as an overall tailwind in the industry 's adoption of data and analytics . at the health system level , we are seeing meaningful evidence that covid-19 is highlighting the need for a commercial-grade data and analytics solution to replace patchwork homegrown systems . 62 our business model we offer our solution to a variety of healthcare organizations , primarily in the united states , including academic medical centers , integrated delivery networks , community hospitals , large physician practices , acos , health information exchanges , health insurers , and other risk-bearing entities . we categorize our customer count into two primary categories : dos subscription customers and other customers . dos subscription customers are defined as customers who access our dos platform via a technology subscription contract . other customers generally include dos non-subscription customers and other customers from historical acquisitions . as of december 31 , 2020 , 2019 , and 2018 , we had 74 , 65 , and 50 dos subscription customers with active subscriptions , respectively . story_separator_special_tag components of our results of operations revenue we derive our revenue from sales of technology and professional services . for the years ended december 31 , 2020 , 2019 , and 2018 , technology revenue represented 58 % , 54 % , and 51 % of total revenue , respectively , and professional services revenue represented 42 % , 46 % , and 49 % of total revenue , respectively . technology revenue . technology revenue primarily consists of subscription fees charged to customers for access to use our data platform and analytics applications . we provide customers access to our technology through either an all-access or limited-access , modular subscription . most of our subscription contracts are cloud-based and have up to a three-year term , of which the vast majority are terminable after one year upon 90 days ' notice . dos subscription customers that access our technology through an all-access or limited access , modular subscription generally have agreements with built-in annual escalators for technology access fees . also included in technology revenue is the maintenance and support we provide , which generally includes updates and support services . professional services revenue . professional services revenue primarily includes analytics services , domain expertise services , outsourcing services , and implementation services . professional services arrangements typically include a fee for making full-time equivalent ( fte ) services available to our customers on a monthly basis . fte services generally consist of a blend of analytic engineers , analysts , and data scientists based on the domain expertise needed to best serve our customers . 67 deferred revenue deferred revenue consists of customer billings in advance of revenue being recognized from our technology and professional services arrangements . we primarily invoice our customers for technology arrangements annually or quarterly in advance . amounts anticipated to be recognized within one year of the balance sheet date are recorded as deferred revenue and the remaining portion is recorded as deferred revenue , net of current portion on the consolidated balance sheets . cost of revenue , excluding depreciation and amortization cost of technology revenue . cost of technology revenue primarily consists of costs associated with hosting and supporting our technology , including third-party cloud computing and hosting costs , contractor costs , and salary and related personnel costs for our cloud services and support teams . although we expect cost of technology revenue to increase in absolute dollars as we transition customers to third-party hosted data centers with microsoft azure and increase headcount to accommodate growth , we anticipate cost of technology revenue as a percentage of technology revenue will generally decrease over the long term . we expect cost of technology revenue as a percentage of technology revenue to fluctuate and potentially increase in the near term , primarily due to additional costs associated with transitioning customers from on-premise and our managed data centers to microsoft azure . cost of professional services revenue . cost of professional services revenue consists primarily of costs related to delivering our team 's expertise in analytics , strategic advisory , improvement , and implementation services . these costs primarily include salary and related personnel costs , travel-related costs , and outside contractor costs . we expect cost of professional services revenue to increase in absolute dollars as we increase headcount to accommodate growth . operating expense sales and marketing . sales and marketing expenses primarily include salary and related personnel costs for our sales , marketing , and account management teams , lead generation , marketing events , including our healthcare analytics summit ( has ) , marketing programs , and outside contractor costs associated with the sale and marketing of our offerings . we plan to continue to invest in sales and marketing to grow our customer base , expand in new markets , and increase our brand awareness . the trend and timing of sales and marketing expenses will depend in part on the timing of our expansion into new markets and marketing campaigns . we expect that sales and marketing expenses will increase in absolute dollars in future periods , but decrease as a percentage of our revenue over the long term . our sales and marketing expenses may fluctuate as a percentage of our revenue from period to period due to the timing and extent of these expenses . research and development . research and development expenses primarily include salary and related personnel costs for our data platform and analytics applications teams , subscriptions , and outside contractor costs associated with the development of products . we have developed an open , flexible , and scalable data platform . we plan to continue to invest in research and development to develop new solutions and enhance our applications library . we expect that research and development expenses will increase in absolute dollars in future periods , but decrease as a percentage of our revenue over the long term . our research and development expenses may fluctuate as a percentage of our revenue from period to period due to the timing and extent of these expenses . general and administrative . general and administrative expenses primarily include salary and related personnel costs for our legal , finance , people operations , it , and other administrative teams , including certain executives . general and administrative expenses also include facilities , subscriptions , corporate insurance , outside legal , accounting , and directors ' fees . due to the closing of our ipo on july 29 , 2019 , we incurred and expect to continue to incur additional costs as a result of operating as a public company , including costs related to compliance and reporting obligations of public companies , and increased costs for insurance , investor relations , and corporate governance . as a result , we expect our general and administrative expenses to increase in absolute dollars for the foreseeable future , but decrease as a percentage of our

the sale generated proceeds of $ 355.9 million and resulted in a gain of $ 192.8 million . as of december 31 , 2014 , we effectively own 44 % of cyrusone , which is held in the form of 1.9 million shares of cyrusone common stock and 26.6 million cyrusone lp partnership units . 29 form 10-k part ii cincinnati bell inc. in the second quarter of 2014 , we entered into agreements to sell our wireless spectrum licenses and certain other assets related to our wireless business . this agreement to sell our wireless spectrum license closed on september 30 , 2014 , for cash proceeds of $ 194.4 million . as a result , we derecognized the $ 88.2 million carrying value of the licenses previously reported as `` intangible assets , net `` in the consolidated balance sheets . also on september 30 , 2014 , we entered into a separate agreement to use certain spectrum licenses until we no longer provide wireless service . we recorded the fair value of the lease of the spectrum of $ 6.4 million , in `` prepaid expenses `` in the consolidated balance sheets . this fair value is considered a level 3 measurement based on other comparable transactions . the asset is being amortized over a six month period and had a net carrying value of $ 3.2 million as of december 31 , 2014. in addition , as we continue to use the licenses , we deferred the gain of $ 112.6 million related to the sale of the spectrum , which is presented in the consolidated balance sheets . we plan to operate and generate cash from our wireless operations until no later than april 6 , 2015. at that time , we will transfer certain leases and other assets valued at approximately $ 25 million to the acquiring company . negotiations with the communications workers of america ( “ cwa ” ) have been ongoing since the tentative agreement reached on august 4 , 2014 was not ratified by local members of the union . we reached another tentative agreement on january 23 , 2015 that is pending ratification by the local union 's members . consolidated results of operations 2014 compared to 2013 service revenue was $ 999.6 million in 2014 , a decrease of $ 39.7 million compared to 2013 . of this decrease , $ 15.2 million was due to the deconsolidation of cyrusone 's results of operations from our consolidated financial statements . excluding the impact of cyrusone , service revenue in 2014 decreased by $ 24.5 million year-over-year , primarily driven by lower wireless service revenue of $ 59.4 million as the postpaid and prepaid subscriber base continues to decline as a result of the wind down of the business . this decrease was partially offset by strong demand for strategic products that resulted in an additional $ 12.2 million of wireline service revenue and $ 22.7 million of it services and hardware revenue . product revenue totaled $ 278.6 million in 2014 , up 28 % compared to 2013 due largely to $ 64.8 million higher sales of telecommunications and it hardware . wireline equipment sales were up $ 4.9 million as a result of sales generated through an agreement with verizon wireless to sell their products and services at our retail locations . increased sales were partially offset by lower wireless handset and accessory sales . cost of services was $ 454.2 million in 2014 , up $ 23.8 million compared to 2013 due to the growth in our strategic products . wireline and it services costs were up $ 17.3 million and $ 17.6 million , respectively . these increases were partially offset by wireless cost of services which are down $ 6.5 million as a result of a declining subscriber base . cyrusone cost of services was $ 4.6 million in 2013. cost of products sold was $ 244.9 million in 2014 up from $ 215.9 million in the prior year , due to a $ 52.6 million increase of costs from higher telecommunications and it hardware sales . wireline cost of products increased by $ 3.8 million primarily related to sales generated through an agreement with verizon wireless to sell their products and services at our retail locations . these increases were partially offset by lower wireless cost of products sold equaling $ 27.4 million , due to lower handset and accessory sales as a result of the planned wind down of the wireless segment . selling , general and administrative ( “ sg & a ” ) expenses were $ 223.1 million in 2014 , an increase of $ 2.3 million compared to the same period in 2013 . cyrusone sg & a expenses were $ 2.4 million prior to the ipo . excluding cyrusone , sg & a expenses increased $ 4.7 million compared to the prior year . wireline and it services and hardware costs were up $ 2.1 million and $ 6.9 million , respectively , to support growth in our strategic products . wireline costs were also up due to outsourcing certain it functions . partially offsetting this increase was a $ 14.9 million decrease in wireless sg & a expenses due primarily to cost containment efforts as we begin to wind down operations . corporate costs were up $ 10.6 million from the prior year primarily as a result of an increase in stock compensation expense due to less mark to market benefit on plans indexed to changes in our stock price as well as increases in other employee related costs . 30 form 10-k part ii cincinnati bell inc. depreciation and amortization was $ 231.0 million in 2014 , an increase of $ 61.4 million compared to the prior year . story_separator_special_tag an income tax benefit of $ 2.5 million in 2013 was the result of pre-tax losses . in 2013 , income tax expense includes a valuation allowance provision of $ 10.7 million for texas margin credits which , effective with cyrusone 's ipo , are uncertain of being realized before their expiration date . in periods without tax law changes , the company expects its effective tax rate to exceed statutory rates primarily due to the non-deductible expenses associated with the broadband securities . the company uses federal and state net operating losses to defray payment of federal and state tax liabilities . as a result , the company had cash income tax payments , net of refunds , of $ 2.8 million in 2013 . discussion of operating segment results the company manages its business based upon products and service offerings . at december 31 , 2012 , we operated four business segments : wireline , it services and hardware , wireless and data center colocation . effective january 24 , 2013 , the date of the cyrusone ipo , we no longer include cyrusone , our former data center colocation segment , in our consolidated financial statements and now account for our ownership in cyrusone as an equity method investment . therefore , at december 31 , 2014 and 2013 , we operated three business segments : wireline , it services and hardware and wireless . certain corporate administrative expenses have been allocated to our business segments based upon the nature of the expense and the relative size of the segment . intercompany transactions between segments have been eliminated . 34 form 10-k part ii cincinnati bell inc. wireline the wireline segment provides products and services such as data transport , high-speed internet , entertainment , local voice , long distance , voip , and other services . cincinnati bell telephone company llc ( cbt ) , a subsidiary of the company , is the incumbent local exchange carrier ( ilec ) for a geography that covers a radius of approximately 25 miles around cincinnati , ohio , and includes parts of northern kentucky and southeastern indiana . cbt has operated this territory for over 140 years . voice and data services beyond its ilec territory , particularly in dayton and mason , ohio , are provided through the operations of cincinnati bell extended territories llc ( `` cbet `` ) , a competitive local exchange carrier ( `` clec `` ) and subsidiary of cbt . the company provides long distance and voip services primarily through its cincinnati bell any distance inc. ( `` cbad `` ) and evolve business solutions llc ( `` evolve `` ) subsidiaries . replace_table_token_5_th 35 form 10-k part ii cincinnati bell inc. 2014 compared to 2013 revenues data revenue consists of fioptics high-speed and dsl internet access , data transport , and interconnection services . data revenue was $ 334.9 million in 2014 , an increase of $ 17.1 million compared to 2013 . strategic data revenue was $ 151.1 million in 2014 , up $ 29.0 million compared to the prior year . revenue from fioptics high-speed internet service increased to $ 45.7 million in 2014 , up 64 % compared to the prior year . the increase is primarily due to a growing subscriber base totaling 113,700 accounts at december 31 , 2014 and an increase in monthly arpu of approximately $ 4.00 , up 12 % compared to the prior year . strategic revenue from dsl customers subscribing to at least a10 megabit internet product totaled $ 6.2 million . strategic business revenue totaled $ 102.7 million , including $ 3.5 million from fioptics , up 9 % from the prior year . legacy data revenue was $ 183.8 million , a decrease of $ 11.9 million from the prior year . this decrease is primarily due to our business customers migrating to higher bandwidth data transport products and a 17 % decline in dsl customers as a result of switching to higher speed internet products . voice local service revenue includes local service , digital trunking , switched access , information services , and other value-added services such as caller identification , voicemail , call waiting , and call return . voice local service revenue was $ 203.5 million in 2014 , down $ 25.6 million compared to 2013 . strategic voice service revenue was $ 21.0 million in 2014 , up $ 3.1 million compared to 2013 , primarily due to an increase in fioptics voice lines , which totaled 61,000 at december 31 , 2014. legacy voice service revenue was $ 175.8 million in 2014 , down $ 28.4 million compared to 2013. the segment continues to lose access lines as a result of , among other factors , customers electing to solely use wireless service in lieu of traditional local wireline service , company-initiated disconnections of customers with credit problems , and customers electing to use service from other providers . in 2014 , legacy voice service revenue also experienced increased access line churn as a result of the wind down of the wireless segment due to customers electing to discontinue their local voice service that had been bundled with their wireless subscription . integration voice revenue totaled $ 6.7 million in 2014 , down $ 0.3 million compared to the prior year . long distance and voip revenue was $ 107.3 million in 2014 , consistent with the prior year as the growth in strategic products offset legacy declines . strategic revenue was $ 58.1 million in 2014 , an increase of $ 7.0 million compared to the prior year due largely to the growth in voip and private line services . legacy revenue was $ 47.0 million in 2014 , a decrease of $ 5.1 million compared to 2013 primarily due to an 8 % decrease in long distance lines as both consumers and business customers are migrating to voip or wireless

cash provided by operating activities during 2013 was $ 78.8 million , a decrease of $ 133.9 million compared to 2012 . this decrease was largely driven by the deconsolidation of cyrusone in january 2013 , the $ 42.6 million payment of transaction related compensation , $ 16.0 million of higher pension and postretirement payments and increased working capital usage . 48 form 10-k part ii cincinnati bell inc. cash flows from investing activities cash flows provided by investing activities were $ 392.6 million in 2014 , compared to cash used by investing activities of $ 185.4 million in 2013 and $ 371.8 million in 2012 . the increase in 2014 compared to the prior year is primarily due to the $ 355.9 million of proceeds received on the sale of cyrusone partnership units , in addition to cash proceeds totaling $ 194.4 million that were received on september 30 , 2014 as a result of the completed wireless spectrum sale . the deconsolidation of cyrusone in 2013 increased cash used in investing activities by $ 19.5 million for the period january 1 , 2013 through january 23 , 2013. excluding cyrusone , capital expenditures were down $ 6.9 million from the prior year largely due to a decreased investment in the wireless network . dividends received from cyrusone were up $ 7.1 million compared to the prior year . capital expenditures were $ 196.9 million for 2013 , which was $ 170.3 million lower than 2012 due primarily to the deconsolidation of cyrusone , offset by increased investment in our strategic fiber products . as a result of the cyrusone ipo , we received dividends of $ 21.3 million from cyrusone in 2013. in 2012 , we deposited $ 11.1 million of cash into an escrow account and released $ 4.9 million from this account to fund construction of a data center .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```cash provided by operating activities during 2013 was $ 78.8 million , a decrease of $ 133.9 million compared to 2012 . this decrease was largely driven by the deconsolidation of cyrusone in january 2013 , the $ 42.6 million payment of transaction related compensation , $ 16.0 million of higher pension and postretirement payments and increased working capital usage . 48 form 10-k part ii cincinnati bell inc. cash flows from investing activities cash flows provided by investing activities were $ 392.6 million in 2014 , compared to cash used by investing activities of $ 185.4 million in 2013 and $ 371.8 million in 2012 . the increase in 2014 compared to the prior year is primarily due to the $ 355.9 million of proceeds received on the sale of cyrusone partnership units , in addition to cash proceeds totaling $ 194.4 million that were received on september 30 , 2014 as a result of the completed wireless spectrum sale . the deconsolidation of cyrusone in 2013 increased cash used in investing activities by $ 19.5 million for the period january 1 , 2013 through january 23 , 2013. excluding cyrusone , capital expenditures were down $ 6.9 million from the prior year largely due to a decreased investment in the wireless network . dividends received from cyrusone were up $ 7.1 million compared to the prior year . capital expenditures were $ 196.9 million for 2013 , which was $ 170.3 million lower than 2012 due primarily to the deconsolidation of cyrusone , offset by increased investment in our strategic fiber products . as a result of the cyrusone ipo , we received dividends of $ 21.3 million from cyrusone in 2013. in 2012 , we deposited $ 11.1 million of cash into an escrow account and released $ 4.9 million from this account to fund construction of a data center . ``` Suspicious Activity Report : the sale generated proceeds of $ 355.9 million and resulted in a gain of $ 192.8 million . as of december 31 , 2014 , we effectively own 44 % of cyrusone , which is held in the form of 1.9 million shares of cyrusone common stock and 26.6 million cyrusone lp partnership units . 29 form 10-k part ii cincinnati bell inc. in the second quarter of 2014 , we entered into agreements to sell our wireless spectrum licenses and certain other assets related to our wireless business . this agreement to sell our wireless spectrum license closed on september 30 , 2014 , for cash proceeds of $ 194.4 million . as a result , we derecognized the $ 88.2 million carrying value of the licenses previously reported as `` intangible assets , net `` in the consolidated balance sheets . also on september 30 , 2014 , we entered into a separate agreement to use certain spectrum licenses until we no longer provide wireless service . we recorded the fair value of the lease of the spectrum of $ 6.4 million , in `` prepaid expenses `` in the consolidated balance sheets . this fair value is considered a level 3 measurement based on other comparable transactions . the asset is being amortized over a six month period and had a net carrying value of $ 3.2 million as of december 31 , 2014. in addition , as we continue to use the licenses , we deferred the gain of $ 112.6 million related to the sale of the spectrum , which is presented in the consolidated balance sheets . we plan to operate and generate cash from our wireless operations until no later than april 6 , 2015. at that time , we will transfer certain leases and other assets valued at approximately $ 25 million to the acquiring company . negotiations with the communications workers of america ( “ cwa ” ) have been ongoing since the tentative agreement reached on august 4 , 2014 was not ratified by local members of the union . we reached another tentative agreement on january 23 , 2015 that is pending ratification by the local union 's members . consolidated results of operations 2014 compared to 2013 service revenue was $ 999.6 million in 2014 , a decrease of $ 39.7 million compared to 2013 . of this decrease , $ 15.2 million was due to the deconsolidation of cyrusone 's results of operations from our consolidated financial statements . excluding the impact of cyrusone , service revenue in 2014 decreased by $ 24.5 million year-over-year , primarily driven by lower wireless service revenue of $ 59.4 million as the postpaid and prepaid subscriber base continues to decline as a result of the wind down of the business . this decrease was partially offset by strong demand for strategic products that resulted in an additional $ 12.2 million of wireline service revenue and $ 22.7 million of it services and hardware revenue . product revenue totaled $ 278.6 million in 2014 , up 28 % compared to 2013 due largely to $ 64.8 million higher sales of telecommunications and it hardware . wireline equipment sales were up $ 4.9 million as a result of sales generated through an agreement with verizon wireless to sell their products and services at our retail locations . increased sales were partially offset by lower wireless handset and accessory sales . cost of services was $ 454.2 million in 2014 , up $ 23.8 million compared to 2013 due to the growth in our strategic products . wireline and it services costs were up $ 17.3 million and $ 17.6 million , respectively . these increases were partially offset by wireless cost of services which are down $ 6.5 million as a result of a declining subscriber base . cyrusone cost of services was $ 4.6 million in 2013. cost of products sold was $ 244.9 million in 2014 up from $ 215.9 million in the prior year , due to a $ 52.6 million increase of costs from higher telecommunications and it hardware sales . wireline cost of products increased by $ 3.8 million primarily related to sales generated through an agreement with verizon wireless to sell their products and services at our retail locations . these increases were partially offset by lower wireless cost of products sold equaling $ 27.4 million , due to lower handset and accessory sales as a result of the planned wind down of the wireless segment . selling , general and administrative ( “ sg & a ” ) expenses were $ 223.1 million in 2014 , an increase of $ 2.3 million compared to the same period in 2013 . cyrusone sg & a expenses were $ 2.4 million prior to the ipo . excluding cyrusone , sg & a expenses increased $ 4.7 million compared to the prior year . wireline and it services and hardware costs were up $ 2.1 million and $ 6.9 million , respectively , to support growth in our strategic products . wireline costs were also up due to outsourcing certain it functions . partially offsetting this increase was a $ 14.9 million decrease in wireless sg & a expenses due primarily to cost containment efforts as we begin to wind down operations . corporate costs were up $ 10.6 million from the prior year primarily as a result of an increase in stock compensation expense due to less mark to market benefit on plans indexed to changes in our stock price as well as increases in other employee related costs . 30 form 10-k part ii cincinnati bell inc. depreciation and amortization was $ 231.0 million in 2014 , an increase of $ 61.4 million compared to the prior year . story_separator_special_tag an income tax benefit of $ 2.5 million in 2013 was the result of pre-tax losses . in 2013 , income tax expense includes a valuation allowance provision of $ 10.7 million for texas margin credits which , effective with cyrusone 's ipo , are uncertain of being realized before their expiration date . in periods without tax law changes , the company expects its effective tax rate to exceed statutory rates primarily due to the non-deductible expenses associated with the broadband securities . the company uses federal and state net operating losses to defray payment of federal and state tax liabilities . as a result , the company had cash income tax payments , net of refunds , of $ 2.8 million in 2013 . discussion of operating segment results the company manages its business based upon products and service offerings . at december 31 , 2012 , we operated four business segments : wireline , it services and hardware , wireless and data center colocation . effective january 24 , 2013 , the date of the cyrusone ipo , we no longer include cyrusone , our former data center colocation segment , in our consolidated financial statements and now account for our ownership in cyrusone as an equity method investment . therefore , at december 31 , 2014 and 2013 , we operated three business segments : wireline , it services and hardware and wireless . certain corporate administrative expenses have been allocated to our business segments based upon the nature of the expense and the relative size of the segment . intercompany transactions between segments have been eliminated . 34 form 10-k part ii cincinnati bell inc. wireline the wireline segment provides products and services such as data transport , high-speed internet , entertainment , local voice , long distance , voip , and other services . cincinnati bell telephone company llc ( cbt ) , a subsidiary of the company , is the incumbent local exchange carrier ( ilec ) for a geography that covers a radius of approximately 25 miles around cincinnati , ohio , and includes parts of northern kentucky and southeastern indiana . cbt has operated this territory for over 140 years . voice and data services beyond its ilec territory , particularly in dayton and mason , ohio , are provided through the operations of cincinnati bell extended territories llc ( `` cbet `` ) , a competitive local exchange carrier ( `` clec `` ) and subsidiary of cbt . the company provides long distance and voip services primarily through its cincinnati bell any distance inc. ( `` cbad `` ) and evolve business solutions llc ( `` evolve `` ) subsidiaries . replace_table_token_5_th 35 form 10-k part ii cincinnati bell inc. 2014 compared to 2013 revenues data revenue consists of fioptics high-speed and dsl internet access , data transport , and interconnection services . data revenue was $ 334.9 million in 2014 , an increase of $ 17.1 million compared to 2013 . strategic data revenue was $ 151.1 million in 2014 , up $ 29.0 million compared to the prior year . revenue from fioptics high-speed internet service increased to $ 45.7 million in 2014 , up 64 % compared to the prior year . the increase is primarily due to a growing subscriber base totaling 113,700 accounts at december 31 , 2014 and an increase in monthly arpu of approximately $ 4.00 , up 12 % compared to the prior year . strategic revenue from dsl customers subscribing to at least a10 megabit internet product totaled $ 6.2 million . strategic business revenue totaled $ 102.7 million , including $ 3.5 million from fioptics , up 9 % from the prior year . legacy data revenue was $ 183.8 million , a decrease of $ 11.9 million from the prior year . this decrease is primarily due to our business customers migrating to higher bandwidth data transport products and a 17 % decline in dsl customers as a result of switching to higher speed internet products . voice local service revenue includes local service , digital trunking , switched access , information services , and other value-added services such as caller identification , voicemail , call waiting , and call return . voice local service revenue was $ 203.5 million in 2014 , down $ 25.6 million compared to 2013 . strategic voice service revenue was $ 21.0 million in 2014 , up $ 3.1 million compared to 2013 , primarily due to an increase in fioptics voice lines , which totaled 61,000 at december 31 , 2014. legacy voice service revenue was $ 175.8 million in 2014 , down $ 28.4 million compared to 2013. the segment continues to lose access lines as a result of , among other factors , customers electing to solely use wireless service in lieu of traditional local wireline service , company-initiated disconnections of customers with credit problems , and customers electing to use service from other providers . in 2014 , legacy voice service revenue also experienced increased access line churn as a result of the wind down of the wireless segment due to customers electing to discontinue their local voice service that had been bundled with their wireless subscription . integration voice revenue totaled $ 6.7 million in 2014 , down $ 0.3 million compared to the prior year . long distance and voip revenue was $ 107.3 million in 2014 , consistent with the prior year as the growth in strategic products offset legacy declines . strategic revenue was $ 58.1 million in 2014 , an increase of $ 7.0 million compared to the prior year due largely to the growth in voip and private line services . legacy revenue was $ 47.0 million in 2014 , a decrease of $ 5.1 million compared to 2013 primarily due to an 8 % decrease in long distance lines as both consumers and business customers are migrating to voip or wireless

based on our experience , we believe that $ 1 million in annual sales is an appropriate threshold for distinguishing between greenfield revenue and mro/ue revenue . however , we often sell our products to intermediaries or subcontract our services ; accordingly , we have limited visibility into how our products or services may ultimately be used and can provide no assurance that our categorization may accurately reflect the sources of such revenue . furthermore , our customers do not typically enter into long-term forward maintenance contracts with us . in any given year , certain of our smaller greenfield projects may generate less than $ 1 million in annual sales , and certain of our larger plant expansions or upgrades may generate in excess of $ 1 million in annual sales , though we believe that such exceptions are few in number and insignificant to our overall results of operations . ths has been excluded from the greenfield and mro/ue calculations . most of ths 's revenue would be classified as mro/ue under these definitions . we believe that our pipeline of planned projects , in addition to our backlog of signed purchase orders , provides us with visibility into our future revenue . historically we have experienced few order cancellations , and the cancellations that have occurred in the past have not been material compared to our total contract volume or total backlog . the small number of order cancellations is attributable in part to the fact that a large portion of our solutions are ordered and installed toward the end of greenfield project construction . our backlog at march 31 , 2020 was $ 105.4 million as compared to $ 120.0 million at march 31 , 2019 . the timing of recognition of revenue out of backlog is not always certain , as it is subject to a variety of factors that may cause delays , many of which are beyond our control ( such as customers ' delivery schedules and levels of capital and maintenance expenditures ) . when delays occur , the recognition of revenue associated with the delayed project is likewise deferred . cost of sales . our cost of sales includes primarily the cost of raw material items used in the manufacture of our products , cost of ancillary products that are sourced from external suppliers and construction labor cost . additional costs of revenue include contract engineering cost directly associated to projects , direct labor cost , shipping and handling costs , and other costs associated with our manufacturing/fabrication operations . the other costs associated with our manufacturing/fabrication operations are primarily indirect production costs , including depreciation , indirect labor costs , and the costs of manufacturing support functions such as logistics and quality assurance . key raw material costs include polymers , copper , stainless steel , insulating material , and other miscellaneous parts related to products manufactured or assembled as part of our heat tracing solutions . historically , our primary raw materials have been readily available from multiple suppliers and raw material costs have been stable , and we have been generally successful with passing along raw material cost increases to our customers . therefore , increases in the cost of key raw materials of our products have not generally affected our gross margins . we can not provide any assurance that we may be able to pass along such cost increases , including the potential impacts of tariffs , to our customers in the future , and if we are unable to do so , our results of operations may be adversely affected . operating expenses . our marketing , general and administrative and engineering expenses are primarily comprised of compensation and related costs for sales , marketing , pre-sales engineering and administrative personnel , as well as other sales related expenses and other costs related to research and development , insurance , professional fees , the global integrated business information system , provisions for bad debts and warranty expense . key drivers affecting our results of operations . our results of operations and financial condition are affected by numerous factors , including those described above under item 1a , `` risk factors `` and elsewhere in this annual report and those described below : 29 timing of greenfield projects . our results of operations in recent years have been impacted by the various construction phases of large greenfield projects . on very large projects , we are typically designated as the heat tracing provider of choice by the project owner . we then engage with multiple contractors to address incorporating various heat tracing solutions throughout the overall project . our largest greenfield projects may generate revenue for several quarters . in the early stages of a greenfield project , our revenues are typically realized from the provision of engineering services . in the middle stages , or the material requirements phase , we typically experience the greatest demand for our heat tracing cable , at which point our revenues tend to accelerate . revenues tend to decrease gradually in the final stages of a project and are generally derived from installation services and demand for electrical panels and other miscellaneous electronic components used in the final installation of heat tracing cable , which we frequently outsource from third-party manufacturers . therefore , we typically provide a mix of products and services during each phase of a greenfield project , and our margins fluctuate accordingly . cyclicality of end-users ' markets . demand for our products and services depends in large part upon the level of capital and maintenance expenditures of our customers and end users , in particular those in the energy , chemical processing and power generation industries , and firms that design and construct facilities for these industries . these customers ' expenditures historically have been cyclical in nature and vulnerable to economic downturns . story_separator_special_tag we can not assure you that our business will generate sufficient cash flow from operations or that future borrowings will be available to us in an amount sufficient to enable us to service our indebtedness , including our credit facility borrowings , or to fund our other liquidity needs . in addition , upon the occurrence of certain events , such as a change of control , we could be required to repay or refinance our indebtedness . we can not assure you that we will be able to refinance any of our indebtedness , including our credit facility , on commercially reasonable terms or at all . in fiscal 2020 , we invested $ 10.9 million in capital expenditures . tps purchased $ 4.4 million in property , plant and equipment , primarily related to leased equipment , of which $ 0.6 million was sold to customers . we invested $ 1.6 million in the implementation of our enterprise resource planning ( “ erp ” ) software and other internally developed software . we invested $ 5.5 million in upgrading various buildings and manufacturing equipment and annual investments in technology , furniture and fixture replacements , and capital maintenance . going forward , we expect to decrease our investment in capital expenditures to approximately $ 4.0 million for the fiscal year ending march 31 , 2021 in response to the covid-19 coronavirus pandemic . during the fiscal year ending march 31 , 2021 , we expect to invest approximately $ 2.2 million in equipment used in our manufacturing facilities , and in land and building improvements . the remaining amount primarily relates to investments in computers and technology equipment to support our business . we will continue to invest in building portable power solutions used as rentals by our tps business based on market demand . year ended march 31 , 2020 ( `` fiscal 2020 `` ) compared to the year ended march 31 , 2019 ( `` fiscal 2019 `` ) net cash provided by operating activities totaled $ 70.7 million for fiscal 2020 compared to $ 23.2 million for fiscal 2019 , an increase of $ 47.5 million . the increase was primarily attributable to a $ 56.6 million increase in cash provided by working capital accounts partially offset by a decrease of $ 11.2 million in net income . our working capital assets in accounts receivable , inventory , contract assets and other current assets represented a source of cash of $ 20.2 million and a use of cash of $ 30.3 million in fiscal 2020 and fiscal 2019 respectively , an increase in the source of cash of $ 50.5 million in fiscal 2020 . during fiscal 2020 , as compared to fiscal 2019 accounts receivable decreased due to the seasonality of the business and the timing of the conversion of contract assets to accounts receivable , representing a source of cash of $ 9.4 million and a use of cash of $ 14.5 million , respectively . contract assets represented a source of cash of $ 12.2 million and a use of cash of $ 12.0 million in fiscal 2020 and fiscal 2019 , respectively , which is primarily attributed to timing of billings on our projects . in fiscal 2020 , our inventory balance decreased as compared to fiscal 2019 due to planned 35 consumption of inventory levels , representing a source of cash of $ 1.4 million for fiscal 2020 and a use of cash of $ 3.4 million in fiscal 2019 . our combined balance of accounts payable , accrued liabilities and other non-current liabilities represented a use of cash of $ 3.1 million and $ 4.1 million in fiscal 2020 and fiscal 2019 , respectively , a decrease in the use of cash of $ 1.0 million . the decrease in the use of cash in fiscal 2020 is primarily due to the timing of vendor payments and our annual incentive program accrual . changes in our income taxes payable and receivable balances represented a source of cash of $ 0.9 million in fiscal 2020 and a use of cash of $ 6.1 million in fiscal 2019 . net cash used in investing activities totaled $ 10.0 million for fiscal 2020 compared to $ 10.1 million for fiscal 2019 , a decrease of $ 0.1 million in the use of cash . net cash used in investing activities relates to the purchase of capital assets primarily to maintain the existing operations of the business . net cash used in financing activities totaled $ 46.5 million in fiscal 2020 , compared to $ 14.1 million for fiscal 2019 , a comparative increase of $ 32.4 million cash used in financing activities which is primarily attributable to principal prepayments on our credit facilities during fiscal 2020 . cash proceeds in financing activities are primarily short-term borrowings net of contractual and principal payments on our outstanding long-term debt . year ended march 31 , 2019 ( `` fiscal 2019 `` ) compared to the year ended march 31 , 2018 ( `` fiscal 2018 `` ) see item 7 , “ management 's discussion and analysis of financial condition and results of operations ” in our annual report on form 10-k for the fiscal year ended march 31 , 2019 filed with the sec on june 12 , 2019 for a discussion of net cash provided by operating activities , net cash used in investing activities and net cash provided by ( used in ) financing activities in fiscal 2019 as compared to fiscal 2018. off-balance sheet arrangements we do not have any off balance sheet arrangements . in addition , we do not have any interest in entities referred to as variable interest entities , which include special purpose entities and other structured finance entities . effect of inflation while inflationary increases in certain input costs , such as wages , have an impact on our operating results , inflation has

liquidity and capital resources our primary sources of liquidity are cash flows from operations and funds available under our revolving credit facility and other revolving lines of credit . our primary liquidity needs are to finance our working capital , capital expenditures debt service needs and potential future acquisitions . in october 2017 , we entered into a new credit agreement that provides for ( i ) a seven-year $ 250.0 million variable rate senior secured term loan b facility and ( ii ) a five-year $ 60.0 million senior secured revolving credit facility . at march 31 , 2020 , outstanding principal under the term loan b facility was $ 176.0 million and we had no outstanding borrowings under our revolving credit facility . subsequent to march 31 , 2020 , we drew down under our revolving credit facility as a precautionary measure in order to increase our cash position and preserve financial flexibility in light of current macroeconomic uncertainty resulting from the covid-19 pandemic and volatility in commodity markets . in april 2020 , we made several draws on our revolving credit facility resulting in a total of $ 41.4 million ( including $ 4.0 million in letters of credit ) in outstanding borrowings and approximately $ 18.6 million of remaining borrowing capacity ( subject to the borrowing base ) under our revolving credit facility , in each case as of april 30 , 2020. the current interest rate as of april 30 , 2020 for borrowings under our revolving credit facility is approximately 2.9 % . cash and cash equivalents . at march 31 , 2020 , we had $ 43.2 million in cash and cash equivalents . we maintain cash and cash equivalents at various financial institutions located in many countries throughout the world . approximately $ 20.8 million , or 48 % , of these amounts were held in domestic accounts with various institutions and approximately $ 22.4 million , or 52 % , of these amounts were held in accounts outside of the united states with various financial institutions . senior secured credit facility .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```liquidity and capital resources our primary sources of liquidity are cash flows from operations and funds available under our revolving credit facility and other revolving lines of credit . our primary liquidity needs are to finance our working capital , capital expenditures debt service needs and potential future acquisitions . in october 2017 , we entered into a new credit agreement that provides for ( i ) a seven-year $ 250.0 million variable rate senior secured term loan b facility and ( ii ) a five-year $ 60.0 million senior secured revolving credit facility . at march 31 , 2020 , outstanding principal under the term loan b facility was $ 176.0 million and we had no outstanding borrowings under our revolving credit facility . subsequent to march 31 , 2020 , we drew down under our revolving credit facility as a precautionary measure in order to increase our cash position and preserve financial flexibility in light of current macroeconomic uncertainty resulting from the covid-19 pandemic and volatility in commodity markets . in april 2020 , we made several draws on our revolving credit facility resulting in a total of $ 41.4 million ( including $ 4.0 million in letters of credit ) in outstanding borrowings and approximately $ 18.6 million of remaining borrowing capacity ( subject to the borrowing base ) under our revolving credit facility , in each case as of april 30 , 2020. the current interest rate as of april 30 , 2020 for borrowings under our revolving credit facility is approximately 2.9 % . cash and cash equivalents . at march 31 , 2020 , we had $ 43.2 million in cash and cash equivalents . we maintain cash and cash equivalents at various financial institutions located in many countries throughout the world . approximately $ 20.8 million , or 48 % , of these amounts were held in domestic accounts with various institutions and approximately $ 22.4 million , or 52 % , of these amounts were held in accounts outside of the united states with various financial institutions . senior secured credit facility . ``` Suspicious Activity Report : based on our experience , we believe that $ 1 million in annual sales is an appropriate threshold for distinguishing between greenfield revenue and mro/ue revenue . however , we often sell our products to intermediaries or subcontract our services ; accordingly , we have limited visibility into how our products or services may ultimately be used and can provide no assurance that our categorization may accurately reflect the sources of such revenue . furthermore , our customers do not typically enter into long-term forward maintenance contracts with us . in any given year , certain of our smaller greenfield projects may generate less than $ 1 million in annual sales , and certain of our larger plant expansions or upgrades may generate in excess of $ 1 million in annual sales , though we believe that such exceptions are few in number and insignificant to our overall results of operations . ths has been excluded from the greenfield and mro/ue calculations . most of ths 's revenue would be classified as mro/ue under these definitions . we believe that our pipeline of planned projects , in addition to our backlog of signed purchase orders , provides us with visibility into our future revenue . historically we have experienced few order cancellations , and the cancellations that have occurred in the past have not been material compared to our total contract volume or total backlog . the small number of order cancellations is attributable in part to the fact that a large portion of our solutions are ordered and installed toward the end of greenfield project construction . our backlog at march 31 , 2020 was $ 105.4 million as compared to $ 120.0 million at march 31 , 2019 . the timing of recognition of revenue out of backlog is not always certain , as it is subject to a variety of factors that may cause delays , many of which are beyond our control ( such as customers ' delivery schedules and levels of capital and maintenance expenditures ) . when delays occur , the recognition of revenue associated with the delayed project is likewise deferred . cost of sales . our cost of sales includes primarily the cost of raw material items used in the manufacture of our products , cost of ancillary products that are sourced from external suppliers and construction labor cost . additional costs of revenue include contract engineering cost directly associated to projects , direct labor cost , shipping and handling costs , and other costs associated with our manufacturing/fabrication operations . the other costs associated with our manufacturing/fabrication operations are primarily indirect production costs , including depreciation , indirect labor costs , and the costs of manufacturing support functions such as logistics and quality assurance . key raw material costs include polymers , copper , stainless steel , insulating material , and other miscellaneous parts related to products manufactured or assembled as part of our heat tracing solutions . historically , our primary raw materials have been readily available from multiple suppliers and raw material costs have been stable , and we have been generally successful with passing along raw material cost increases to our customers . therefore , increases in the cost of key raw materials of our products have not generally affected our gross margins . we can not provide any assurance that we may be able to pass along such cost increases , including the potential impacts of tariffs , to our customers in the future , and if we are unable to do so , our results of operations may be adversely affected . operating expenses . our marketing , general and administrative and engineering expenses are primarily comprised of compensation and related costs for sales , marketing , pre-sales engineering and administrative personnel , as well as other sales related expenses and other costs related to research and development , insurance , professional fees , the global integrated business information system , provisions for bad debts and warranty expense . key drivers affecting our results of operations . our results of operations and financial condition are affected by numerous factors , including those described above under item 1a , `` risk factors `` and elsewhere in this annual report and those described below : 29 timing of greenfield projects . our results of operations in recent years have been impacted by the various construction phases of large greenfield projects . on very large projects , we are typically designated as the heat tracing provider of choice by the project owner . we then engage with multiple contractors to address incorporating various heat tracing solutions throughout the overall project . our largest greenfield projects may generate revenue for several quarters . in the early stages of a greenfield project , our revenues are typically realized from the provision of engineering services . in the middle stages , or the material requirements phase , we typically experience the greatest demand for our heat tracing cable , at which point our revenues tend to accelerate . revenues tend to decrease gradually in the final stages of a project and are generally derived from installation services and demand for electrical panels and other miscellaneous electronic components used in the final installation of heat tracing cable , which we frequently outsource from third-party manufacturers . therefore , we typically provide a mix of products and services during each phase of a greenfield project , and our margins fluctuate accordingly . cyclicality of end-users ' markets . demand for our products and services depends in large part upon the level of capital and maintenance expenditures of our customers and end users , in particular those in the energy , chemical processing and power generation industries , and firms that design and construct facilities for these industries . these customers ' expenditures historically have been cyclical in nature and vulnerable to economic downturns . story_separator_special_tag we can not assure you that our business will generate sufficient cash flow from operations or that future borrowings will be available to us in an amount sufficient to enable us to service our indebtedness , including our credit facility borrowings , or to fund our other liquidity needs . in addition , upon the occurrence of certain events , such as a change of control , we could be required to repay or refinance our indebtedness . we can not assure you that we will be able to refinance any of our indebtedness , including our credit facility , on commercially reasonable terms or at all . in fiscal 2020 , we invested $ 10.9 million in capital expenditures . tps purchased $ 4.4 million in property , plant and equipment , primarily related to leased equipment , of which $ 0.6 million was sold to customers . we invested $ 1.6 million in the implementation of our enterprise resource planning ( “ erp ” ) software and other internally developed software . we invested $ 5.5 million in upgrading various buildings and manufacturing equipment and annual investments in technology , furniture and fixture replacements , and capital maintenance . going forward , we expect to decrease our investment in capital expenditures to approximately $ 4.0 million for the fiscal year ending march 31 , 2021 in response to the covid-19 coronavirus pandemic . during the fiscal year ending march 31 , 2021 , we expect to invest approximately $ 2.2 million in equipment used in our manufacturing facilities , and in land and building improvements . the remaining amount primarily relates to investments in computers and technology equipment to support our business . we will continue to invest in building portable power solutions used as rentals by our tps business based on market demand . year ended march 31 , 2020 ( `` fiscal 2020 `` ) compared to the year ended march 31 , 2019 ( `` fiscal 2019 `` ) net cash provided by operating activities totaled $ 70.7 million for fiscal 2020 compared to $ 23.2 million for fiscal 2019 , an increase of $ 47.5 million . the increase was primarily attributable to a $ 56.6 million increase in cash provided by working capital accounts partially offset by a decrease of $ 11.2 million in net income . our working capital assets in accounts receivable , inventory , contract assets and other current assets represented a source of cash of $ 20.2 million and a use of cash of $ 30.3 million in fiscal 2020 and fiscal 2019 respectively , an increase in the source of cash of $ 50.5 million in fiscal 2020 . during fiscal 2020 , as compared to fiscal 2019 accounts receivable decreased due to the seasonality of the business and the timing of the conversion of contract assets to accounts receivable , representing a source of cash of $ 9.4 million and a use of cash of $ 14.5 million , respectively . contract assets represented a source of cash of $ 12.2 million and a use of cash of $ 12.0 million in fiscal 2020 and fiscal 2019 , respectively , which is primarily attributed to timing of billings on our projects . in fiscal 2020 , our inventory balance decreased as compared to fiscal 2019 due to planned 35 consumption of inventory levels , representing a source of cash of $ 1.4 million for fiscal 2020 and a use of cash of $ 3.4 million in fiscal 2019 . our combined balance of accounts payable , accrued liabilities and other non-current liabilities represented a use of cash of $ 3.1 million and $ 4.1 million in fiscal 2020 and fiscal 2019 , respectively , a decrease in the use of cash of $ 1.0 million . the decrease in the use of cash in fiscal 2020 is primarily due to the timing of vendor payments and our annual incentive program accrual . changes in our income taxes payable and receivable balances represented a source of cash of $ 0.9 million in fiscal 2020 and a use of cash of $ 6.1 million in fiscal 2019 . net cash used in investing activities totaled $ 10.0 million for fiscal 2020 compared to $ 10.1 million for fiscal 2019 , a decrease of $ 0.1 million in the use of cash . net cash used in investing activities relates to the purchase of capital assets primarily to maintain the existing operations of the business . net cash used in financing activities totaled $ 46.5 million in fiscal 2020 , compared to $ 14.1 million for fiscal 2019 , a comparative increase of $ 32.4 million cash used in financing activities which is primarily attributable to principal prepayments on our credit facilities during fiscal 2020 . cash proceeds in financing activities are primarily short-term borrowings net of contractual and principal payments on our outstanding long-term debt . year ended march 31 , 2019 ( `` fiscal 2019 `` ) compared to the year ended march 31 , 2018 ( `` fiscal 2018 `` ) see item 7 , “ management 's discussion and analysis of financial condition and results of operations ” in our annual report on form 10-k for the fiscal year ended march 31 , 2019 filed with the sec on june 12 , 2019 for a discussion of net cash provided by operating activities , net cash used in investing activities and net cash provided by ( used in ) financing activities in fiscal 2019 as compared to fiscal 2018. off-balance sheet arrangements we do not have any off balance sheet arrangements . in addition , we do not have any interest in entities referred to as variable interest entities , which include special purpose entities and other structured finance entities . effect of inflation while inflationary increases in certain input costs , such as wages , have an impact on our operating results , inflation has

the promissory note will bear interest of 5 % per annum for the first year and 13 % per annum for the second year ; the interest will be payable semi-annually in cash , and the note will mature two years from the closing of the transaction . in addition , the promissory note will be subject to prepayment under certain circumstances and will be secured by certain of the assets to be sold pursuant to the asset purchase agreement with emcore . the note is subordinated to our existing bank debt in the u.s. we will account for the acquisition as a business combination . on march 29 , 2013 , we acquired certain assets and assumed certain liabilities related to the semiconductor optical components business unit of lapis semiconductor co. , ltd. ( “ lapis ” ) , a wholly-owned subsidiary of rohm co. , ltd. of japan . the business is now known as neophotonics semiconductor . total consideration for this acquisition was approximately $ 24.3 million , including $ 13.1 million in cash and $ 11.1 million in notes payable for the purchase of the real estate used by neophotonics semiconductor , of which 700 million japanese yen ( “ jpy ” ) ( $ 5.8 million ) was outstanding as of december 31 , 2014 . 46 debt arrangements during the first quarter of 2015 , we completed actions to restructure certain of our debt obligations . by restructuring our debt , we eliminated certain cash restrictions and improved our cash flow . as of december 31 , 2014 , we had $ 23.3 million of long-term debt , which consisted of a term loan led by comerica bank of $ 17.5 million , secured by restricted cash of an equal amount , and a mortgage from lapis of $ 5.8 million . in the first quarter of 2015 , we restructured both of these arrangements to increase the usability of our comerica borrowing capacity by approximately $ 9 million while eliminating certain restrictions on cash ; and we entered into a new financing arrangement with bank of tokyo-mitsubishi ufj , ltd. which paid off the lapis mortgage in japan and increased our available cash balances through two long-term mortgage instruments totaling $ 12.6 million . these actions increased our unrestricted cash by approximately $ 22 million and improved our cash availability for 2015. in addition , at december 31 , 2014 , we had $ 22.8 million of short-term notes payable and borrowings in china . we expect to maintain such facilities at approximately this level through 2015. product group reporting we plan to realign our product group reporting for 2015. for all of 2014 , revenue attributable to our “ speed and agility ” product group was approximately 73.5 % of our total revenue , of which our “ high speed ” products were approximately 42.9 % of total revenue , revenue attributable to our “ access ” products was approximately 20.2 % of total revenue , and revenue attributable to our “ other telecom ” products were approximately 6.3 % of total revenue . in terms of our reporting structure for 2015 and beyond , for the full year of 2014 , 42.3 % of our total revenue would have been reported as revenue from “ high speed products ” ( 100g and beyond ) and 57.7 % of our total revenue would have been reported as revenue from “ network products and solutions . ” note that in reporting for 2015 and onward , revenue from products designed for 40g is expected to be moved from the previously reported “ high speed ” to the new category of “ network products and solutions , ” and such revenue is expected to continue to decline over time . the tunable laser products acquired from emcore during the first quarter of 2015 is expected to be included in high speed products . update on planned expansion in the russian federation in april 2012 , we entered into a rights agreement with open joint stock company “ rusnano ” or rusnano , one of our principal stockholders . under the rights agreement , we agreed to make a $ 30.0 million investment commitment ( the “ investment commitment ” ) toward our russian operations . the investment commitment can be partially satisfied by cash and or non-cash investment inside or outside of russia and or by way of non-cash asset transfers . in july 2014 , we extended our then-current investment commitment milestone to march 31 , 2015. in march 2015 , we further extended our investment commitment milestone to june 30 , 2015. if we fail to meet the investment commitment by such date , we may be required to pay a $ 5.0 million penalty as the sole and exclusive remedy for damages and monetary relief available to rusnano for failure to meet the investment commitment . we are currently in discussions with rusnano to potentially amend the related requirements , but there can be no assurance that we will be successful in reaching an agreement with rusnano on amending the requirements . separately , on december 18 , 2014 , we entered into a commitment to file a resale registration statement and related waiver of registration rights , whereby rusnano waived certain registration rights in connection with a potential offering by us of shares of our common stock , and we committed to file with the sec a resale registration statement on form s-1 covering the resale of all shares of our common stock held by rusnano . story_separator_special_tag we expect that our gross margin is likely to continue to fluctuate due to a variety of factors , including the introduction of new products , production volume , production volume compared to sales over time , the mix of products sold , inventory changes , changes in the average selling prices of our products , changes in the cost and volumes of materials purchased from our suppliers , changes in labor costs , changes in overhead costs or requirements , revaluation of stock appreciation unit awards that are impacted by our stock price , write-downs of excess and obsolete inventories and warranty costs . in addition , we periodically negotiate pricing with certain customers which can cause our gross margins to fluctuate , particularly in the quarters subsequent to the periods in which the negotiations occurred . operating expenses replace_table_token_9_th 51 research and development research and development expense consists of personnel costs , including stock-based compensation , for our research and development personnel , and product development costs , including engineering services , development software and hardware tools , depreciation of equipment and facility costs . we record all research and development expense as incurred . research and development expense increased $ 0.1 million in 2014 compared to 2013. the increase was attributable to a $ 0.5 million increase in depreciation and amortization expense and a $ 0.2 million increase in stock-based compensation expense , offset by a $ 0.4 million decrease in payroll expenses due to headcount reductions and a $ 0.2 million reduction in development materials related spending . research and development expense increased by $ 7.6 million in 2013 compared to 2012 , representing a 20 % increase . the acquisition of neophotonics semiconductor increased our research and development expense by $ 3.7 million . other increases in 2013 included $ 2.9 million for research and development projects to support our business growth , $ 1.4 million for labor and facilities expenses related to manufacturing support of research and development activities , $ 0.5 million in higher compensation-related costs , partially offset by a $ 1.0 million decrease related to additional retention-related compensation costs in 2012 related to the acquisition of santur . we believe that investments in research and development are important to help meet our strategic objectives . in 2015 , we plan to continue to invest in research and development activities , including new products that will further enhance our competitive position . in particular , the acquisition of the tunable laser product line of emcore in early january 2015 is anticipated to result in an increase in our research and development expenses . as a percentage of total revenue , our research and development expense may vary as our investment and revenue levels change over time . sales and marketing sales and marketing expense consists primarily of personnel costs , including stock-based compensation and sales commissions , costs related to sales and marketing programs and services and facility costs . sales and marketing expense decreased by $ 0.5 million in 2014 compared to 2013 , representing a 4 % decrease , primarily due to a $ 0.6 million decrease in payroll and benefit expenses and a $ 0.3 million decrease in product demo expenses , partially offset by a $ 0.3 million increase in stock-based compensation expense . sales and marketing expense increased by $ 1.0 million in 2013 compared to 2012 , representing an 8 % increase which was primarily due to increases from the acquisition of neophotonics semiconductor and higher variable compensation costs . we expect to continue to focus on controlling our sales and marketing expenses in 2015 even as our business continues to expand geographically . as a percentage of total revenue , our sales and marketing expense may vary as our revenue changes over time . general and administrative general and administrative expense consists of personnel costs , including stock-based compensation , for our finance , human resources and information technology personnel and certain executive officers , as well as professional services costs related to accounting , tax , banking , legal and information technology services , depreciation and facility costs . general and administrative expense increased by $ 1.6 million in 2014 compared to 2013 , representing a 5 % increase . the increase was primarily due to a $ 2.6 million increase in audit and tax fees primarily related to the restatement of our quarterly reports on forms 10-q for the quarters ended march 31 and june 30 , 2013 , a $ 1.1 million increase in bonus expense and a $ 0.9 million in payroll expenses , partially offset by a $ 2.1 million decrease in consulting fees , a $ 0.5 million decrease in benefit expenses , and a $ 0.2 million decrease in computer equipment expenses . general and administrative expense increased by $ 5.7 million in 2013 compared to 2012 , representing a 23 % increase . consulting and professional fees increased by $ 3.6 million primarily related to resources to assist us in the process of remediating weaknesses in our controls over financial reporting , to provide technical accounting support and to fill key vacant positions on an interim basis as well as costs related to the restatement of our quarterly report on forms 10-q for the quarters ended march 31 and june 30 , 2013. additional increases included $ 1.4 million in higher software license and other it-related expenses , costs from the newly acquired neophotonics semiconductor of $ 1.3 million , $ 0.5 million in higher audit-related fees , $ 0.6 million in loss on disposal of fixed assets , $ 1.2 million in higher stock-based compensation , payroll and related costs and $ 0.5 million in other costs to support our continued growth . these increases were partially offset by a $ 3.3 million decrease in bonus expense and a $ 0.4 million decrease in depreciation expense . 52 we expect to continue to focus on controlling

cash flow discussion the table below sets forth selected cash flow data for the periods presented : replace_table_token_11_th 56 operating activities in 2014 , net cash used in operating activities was $ 0.5 million , which was a $ 5.0 million decrease compared to the $ 4.5 million cash provided by operating activities in 2013. the decrease was primarily attributable to an increase in accounts receivable due to higher revenue in 2014 while days sales outstanding improved compared to 2013. additional contributing factors to the increase in net cash used in operating activities included lower accounts payable related payments and higher accrued and other liabilities in 2013 and an increase in prepaid expenses and other assets in 2014 primarily attributable to sales tax refunds , partially offset by a reduction in net loss , net of non-cash charges , and a lower inventory level in 2014 , compared to 2013. in 2013 , net cash provided by operating activities was $ 4.5 million , which was a $ 13.3 million increase over the $ 8.8 million cash used in operating activities in 2012. contributing to the increase was a decrease in accounts receivable , particularly in china where days sales outstanding declined and revenue was lower at the end of 2013 compared to the end of 2012. additionally , operating cash flow benefitted from an increase in accounts payable primarily due to higher inventory purchases in china near the end of 2013 and higher accrued and other current liabilities , partially offset by a higher net loss in 2013. in 2012 , net cash used in operating activities was $ 8.8 million . during the year ended december 31 , 2012 , we recognized a net loss of $ 17.5 million , which incorporated non-cash charges , including depreciation and amortization of $ 18.7 million , stock-based compensation expenses of $ 4.8

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```cash flow discussion the table below sets forth selected cash flow data for the periods presented : replace_table_token_11_th 56 operating activities in 2014 , net cash used in operating activities was $ 0.5 million , which was a $ 5.0 million decrease compared to the $ 4.5 million cash provided by operating activities in 2013. the decrease was primarily attributable to an increase in accounts receivable due to higher revenue in 2014 while days sales outstanding improved compared to 2013. additional contributing factors to the increase in net cash used in operating activities included lower accounts payable related payments and higher accrued and other liabilities in 2013 and an increase in prepaid expenses and other assets in 2014 primarily attributable to sales tax refunds , partially offset by a reduction in net loss , net of non-cash charges , and a lower inventory level in 2014 , compared to 2013. in 2013 , net cash provided by operating activities was $ 4.5 million , which was a $ 13.3 million increase over the $ 8.8 million cash used in operating activities in 2012. contributing to the increase was a decrease in accounts receivable , particularly in china where days sales outstanding declined and revenue was lower at the end of 2013 compared to the end of 2012. additionally , operating cash flow benefitted from an increase in accounts payable primarily due to higher inventory purchases in china near the end of 2013 and higher accrued and other current liabilities , partially offset by a higher net loss in 2013. in 2012 , net cash used in operating activities was $ 8.8 million . during the year ended december 31 , 2012 , we recognized a net loss of $ 17.5 million , which incorporated non-cash charges , including depreciation and amortization of $ 18.7 million , stock-based compensation expenses of $ 4.8 ``` Suspicious Activity Report : the promissory note will bear interest of 5 % per annum for the first year and 13 % per annum for the second year ; the interest will be payable semi-annually in cash , and the note will mature two years from the closing of the transaction . in addition , the promissory note will be subject to prepayment under certain circumstances and will be secured by certain of the assets to be sold pursuant to the asset purchase agreement with emcore . the note is subordinated to our existing bank debt in the u.s. we will account for the acquisition as a business combination . on march 29 , 2013 , we acquired certain assets and assumed certain liabilities related to the semiconductor optical components business unit of lapis semiconductor co. , ltd. ( “ lapis ” ) , a wholly-owned subsidiary of rohm co. , ltd. of japan . the business is now known as neophotonics semiconductor . total consideration for this acquisition was approximately $ 24.3 million , including $ 13.1 million in cash and $ 11.1 million in notes payable for the purchase of the real estate used by neophotonics semiconductor , of which 700 million japanese yen ( “ jpy ” ) ( $ 5.8 million ) was outstanding as of december 31 , 2014 . 46 debt arrangements during the first quarter of 2015 , we completed actions to restructure certain of our debt obligations . by restructuring our debt , we eliminated certain cash restrictions and improved our cash flow . as of december 31 , 2014 , we had $ 23.3 million of long-term debt , which consisted of a term loan led by comerica bank of $ 17.5 million , secured by restricted cash of an equal amount , and a mortgage from lapis of $ 5.8 million . in the first quarter of 2015 , we restructured both of these arrangements to increase the usability of our comerica borrowing capacity by approximately $ 9 million while eliminating certain restrictions on cash ; and we entered into a new financing arrangement with bank of tokyo-mitsubishi ufj , ltd. which paid off the lapis mortgage in japan and increased our available cash balances through two long-term mortgage instruments totaling $ 12.6 million . these actions increased our unrestricted cash by approximately $ 22 million and improved our cash availability for 2015. in addition , at december 31 , 2014 , we had $ 22.8 million of short-term notes payable and borrowings in china . we expect to maintain such facilities at approximately this level through 2015. product group reporting we plan to realign our product group reporting for 2015. for all of 2014 , revenue attributable to our “ speed and agility ” product group was approximately 73.5 % of our total revenue , of which our “ high speed ” products were approximately 42.9 % of total revenue , revenue attributable to our “ access ” products was approximately 20.2 % of total revenue , and revenue attributable to our “ other telecom ” products were approximately 6.3 % of total revenue . in terms of our reporting structure for 2015 and beyond , for the full year of 2014 , 42.3 % of our total revenue would have been reported as revenue from “ high speed products ” ( 100g and beyond ) and 57.7 % of our total revenue would have been reported as revenue from “ network products and solutions . ” note that in reporting for 2015 and onward , revenue from products designed for 40g is expected to be moved from the previously reported “ high speed ” to the new category of “ network products and solutions , ” and such revenue is expected to continue to decline over time . the tunable laser products acquired from emcore during the first quarter of 2015 is expected to be included in high speed products . update on planned expansion in the russian federation in april 2012 , we entered into a rights agreement with open joint stock company “ rusnano ” or rusnano , one of our principal stockholders . under the rights agreement , we agreed to make a $ 30.0 million investment commitment ( the “ investment commitment ” ) toward our russian operations . the investment commitment can be partially satisfied by cash and or non-cash investment inside or outside of russia and or by way of non-cash asset transfers . in july 2014 , we extended our then-current investment commitment milestone to march 31 , 2015. in march 2015 , we further extended our investment commitment milestone to june 30 , 2015. if we fail to meet the investment commitment by such date , we may be required to pay a $ 5.0 million penalty as the sole and exclusive remedy for damages and monetary relief available to rusnano for failure to meet the investment commitment . we are currently in discussions with rusnano to potentially amend the related requirements , but there can be no assurance that we will be successful in reaching an agreement with rusnano on amending the requirements . separately , on december 18 , 2014 , we entered into a commitment to file a resale registration statement and related waiver of registration rights , whereby rusnano waived certain registration rights in connection with a potential offering by us of shares of our common stock , and we committed to file with the sec a resale registration statement on form s-1 covering the resale of all shares of our common stock held by rusnano . story_separator_special_tag we expect that our gross margin is likely to continue to fluctuate due to a variety of factors , including the introduction of new products , production volume , production volume compared to sales over time , the mix of products sold , inventory changes , changes in the average selling prices of our products , changes in the cost and volumes of materials purchased from our suppliers , changes in labor costs , changes in overhead costs or requirements , revaluation of stock appreciation unit awards that are impacted by our stock price , write-downs of excess and obsolete inventories and warranty costs . in addition , we periodically negotiate pricing with certain customers which can cause our gross margins to fluctuate , particularly in the quarters subsequent to the periods in which the negotiations occurred . operating expenses replace_table_token_9_th 51 research and development research and development expense consists of personnel costs , including stock-based compensation , for our research and development personnel , and product development costs , including engineering services , development software and hardware tools , depreciation of equipment and facility costs . we record all research and development expense as incurred . research and development expense increased $ 0.1 million in 2014 compared to 2013. the increase was attributable to a $ 0.5 million increase in depreciation and amortization expense and a $ 0.2 million increase in stock-based compensation expense , offset by a $ 0.4 million decrease in payroll expenses due to headcount reductions and a $ 0.2 million reduction in development materials related spending . research and development expense increased by $ 7.6 million in 2013 compared to 2012 , representing a 20 % increase . the acquisition of neophotonics semiconductor increased our research and development expense by $ 3.7 million . other increases in 2013 included $ 2.9 million for research and development projects to support our business growth , $ 1.4 million for labor and facilities expenses related to manufacturing support of research and development activities , $ 0.5 million in higher compensation-related costs , partially offset by a $ 1.0 million decrease related to additional retention-related compensation costs in 2012 related to the acquisition of santur . we believe that investments in research and development are important to help meet our strategic objectives . in 2015 , we plan to continue to invest in research and development activities , including new products that will further enhance our competitive position . in particular , the acquisition of the tunable laser product line of emcore in early january 2015 is anticipated to result in an increase in our research and development expenses . as a percentage of total revenue , our research and development expense may vary as our investment and revenue levels change over time . sales and marketing sales and marketing expense consists primarily of personnel costs , including stock-based compensation and sales commissions , costs related to sales and marketing programs and services and facility costs . sales and marketing expense decreased by $ 0.5 million in 2014 compared to 2013 , representing a 4 % decrease , primarily due to a $ 0.6 million decrease in payroll and benefit expenses and a $ 0.3 million decrease in product demo expenses , partially offset by a $ 0.3 million increase in stock-based compensation expense . sales and marketing expense increased by $ 1.0 million in 2013 compared to 2012 , representing an 8 % increase which was primarily due to increases from the acquisition of neophotonics semiconductor and higher variable compensation costs . we expect to continue to focus on controlling our sales and marketing expenses in 2015 even as our business continues to expand geographically . as a percentage of total revenue , our sales and marketing expense may vary as our revenue changes over time . general and administrative general and administrative expense consists of personnel costs , including stock-based compensation , for our finance , human resources and information technology personnel and certain executive officers , as well as professional services costs related to accounting , tax , banking , legal and information technology services , depreciation and facility costs . general and administrative expense increased by $ 1.6 million in 2014 compared to 2013 , representing a 5 % increase . the increase was primarily due to a $ 2.6 million increase in audit and tax fees primarily related to the restatement of our quarterly reports on forms 10-q for the quarters ended march 31 and june 30 , 2013 , a $ 1.1 million increase in bonus expense and a $ 0.9 million in payroll expenses , partially offset by a $ 2.1 million decrease in consulting fees , a $ 0.5 million decrease in benefit expenses , and a $ 0.2 million decrease in computer equipment expenses . general and administrative expense increased by $ 5.7 million in 2013 compared to 2012 , representing a 23 % increase . consulting and professional fees increased by $ 3.6 million primarily related to resources to assist us in the process of remediating weaknesses in our controls over financial reporting , to provide technical accounting support and to fill key vacant positions on an interim basis as well as costs related to the restatement of our quarterly report on forms 10-q for the quarters ended march 31 and june 30 , 2013. additional increases included $ 1.4 million in higher software license and other it-related expenses , costs from the newly acquired neophotonics semiconductor of $ 1.3 million , $ 0.5 million in higher audit-related fees , $ 0.6 million in loss on disposal of fixed assets , $ 1.2 million in higher stock-based compensation , payroll and related costs and $ 0.5 million in other costs to support our continued growth . these increases were partially offset by a $ 3.3 million decrease in bonus expense and a $ 0.4 million decrease in depreciation expense . 52 we expect to continue to focus on controlling

we supply and transmit our members ' electric power requirements through a portfolio of resources , including generating and transmission facilities , long‑term purchase contracts and short‑term energy purchases . we own , lease , have undivided percentage interests in , or have tolling arrangements with respect to , various generating stations . additionally , we transmit power to our members through resources that we own , lease or have undivided percentage interests in , or by wheeling power across lines owned by other transmission providers . see “ business - overview- power supply and transmission ” for a description of miles of transmission lines and substations . depending on our system requirements and contractual obligations , we are likely to both purchase and sell electric power during the same fiscal period . we purchase hydroelectric power under long‑term purchase contracts . 38 these contracts constituted our original power resource , and they remain a cost‑effective power source . we also purchase , under long‑term purchase contracts with basin , all the power which we require to serve our members ' load in the eastern interconnection and fixed scheduled quantities of power in the western interconnection . our generating facilities are located in the western interconnection and generally isolated from our members ' load in the eastern interconnection . these long‑term purchase commitments represent a majority of our electric power purchases . we purchase additional power on a long and short‑term basis , including 477 mws under long-term purchase contracts from other renewable energy resources , including wind , solar and small hydro . at the same time , we have agreed to supply electric power to non‑members . in addition , we utilize market purchases to optimize our position by routinely purchasing power when the market price is lower than our incremental production cost and routinely selling power to the short‑term market after consideration of our incremental production cost when we have excess power available above our firm commitments to both members and non‑members . we also use short-term energy purchases during periods of generation outages at our facilities . 2017 developments we , along with nine other participants , are part of an informal group known as the mwtg , which was formed to develop strategies to adapt to the changing electric industry in the rocky mountain region of the western interconnection . in january 2017 , the mwtg began discussions with the spp to explore potential membership . in september 2017 , the mwtg announced plans to commence negotiations with spp regarding membership . this announcement initiated a formal spp public stakeholder process . our negotiations with spp involve our transmission facilities , generating facilities and loads that are located in the states of colorado and wyoming , along with a small portion in western nebraska and new mexico . our membership in a regional transmission organization in the western interconnection could have many benefits for our system . each of the participating entities will have a multi-step approval process involving some combination of executive , board of director , customer , city , state , and federal approvals . approval from the ferc is also required . critical accounting policies the preparation of our financial statements in conformity with gaap requires that our management make estimates and assumptions that affect the amounts reported in our consolidated financial statements . we base these estimates and assumptions on information available as of the date of the financial statements and they are not necessarily indicative of the results to be expected for the year . we consider the following accounting policies to be critical accounting policies due to the estimation involved or due to the particular significance they have on our consolidated financial statements . accounting for rate regulation . we are a rate-regulated entity and , as a result , are subject to the accounting requirements of accounting for regulated operations . in accordance with these accounting requirements , some revenues and expenses have been deferred at the discretion of our board , which has budgetary and rate‑setting authority , if it is probable that these amounts will be refunded or recovered through future rates . regulatory assets are costs we expect to recover from members based on rates approved by our board in accordance with our rate policy . regulatory liabilities represent probable future reductions in rates associated with amounts that are expected to be refunded to members based on rates approved by our board in accordance with our rate policy . we recognize regulatory assets and liabilities as expenses or as a reduction in expenses concurrent with their recovery in rates . leases . the accounting for lease transactions in conformity with gaap requires management to make various assumptions , including the discount rate , the fair market value of the leased assets and the estimated useful life , in order to determine whether a lease should be classified as operating or capital . we are the lessor under a power sales arrangement that is required to be accounted for as an operating lease since the arrangement is in substance a lease because it conveys the right to use our power generating equipment for a stated period of time . the lease revenue from this arrangement is included in other operating revenue on our consolidated statements of operations . we are the lessee under a power purchase arrangement that is required to be accounted for as an operating lease since the arrangement is in substance a lease because it conveys to us the right to use power generating equipment for a stated period of time . it is included in lease expense on our consolidated statements of operations . 39 asset retirement obligations . we account for current obligations associated with the future retirement of tangible long‑lived assets in accordance with the accounting guidance relating to asset retirement and environmental obligations . story_separator_special_tag arrangement . operating expenses purchased power decreased 79,036 mwhs to 7,249,540 mwhs in 2017 compared to 7,328,576 mwhs in 2016. the decrease in mwhs sold was due to a decrease in short-term market purchases of 328,591 mwhs , partially offset by an increase in long-term renewable energy power purchases of 194,336 mwhs and long-term firm purchases of 55,219 mwhs . although mwhs sold decreased , purchased power expense increased $ 11.4 million to $ 339.8 million in 2017 compared to $ 328.4 million in 2016. the increase in purchased power expense was primarily due to an increase of $ 11.2 million , or 24.8 percent , to $ 56.3 million in 2017 compared to $ 45.1 million in 2016 for relatively similar mwh purchases from a new wind generating facility . our purchases of power from the new wind generating facilities had a higher average cost per mwh for the first six months of 2017 compared to the same period in 2016 when we were paying a lower pre-commercial rate . additionally , purchased power expense from basin increased in 2017 compared to 2016 for relatively similar mwh purchases from basin . our purchases of power from basin had a higher average cost per mwh in 2017 compared 2016 due to basin 's rate increase in the third quarter 2016. the increase in purchase power expense was partially offset by a decrease in short-term market purchases . depreciation , amortization and depletion expense increased $ 0.5 million to $ 174.5 million in 2017 compared to $ 174.0 million in 2016. depreciation expense for generation plant increased $ 9.9 million primarily due to the shortened life associated with the anticipated december 31 , 2022 retirement date of the nucla generating station of $ 8.8 million and due to the shortened life associated with the anticipated december 31 , 2025 retirement date of the craig station 43 unit 1 of $ 2.9 million . depreciation expense for transmission assets decreased $ 6.1 million primarily due to a $ 8.9 million decrease as a result of the transmission rate study , offset by additions of equipment throughout our transmission system . depreciation expense for general plant and other decreased $ 3.3 million primarily due to a $ 5.3 million decrease as a result of the general plant rate study , offset by additions of equipment to our general plant . other income other income decreased $ 2.0 million , or 7.1 percent , to $ 26.6 million in 2017 compared to $ 28.6 million in 2016. the decrease in other income was primarily due to the patronage allocation from basin of $ 7.1 million in 2017 compared to $ 14.4 million for the same period in 2016. the decrease was partially offset by the recognition of $ 5.0 million of deferred membership withdrawal income in 2017. year ended december 31 , 2016 compared to year ended december 31 , 2015 operating revenues member electric sales decreased 34,288 mwhs to 15,746,382 mwhs in 2016 compared to 15,780,670 mwhs in 2015. the withdrawal of kcec in june 2016 resulted in a 138,650 mwhs decrease in 2016 compared to 2015. although mwhs sold decreased in 2016 , member electric sales revenue increased $ 9.0 million to $ 1.135 billion in 2016 compared to $ 1.126 billion in 2015 as a result of the new rate design implemented for 2016. see “ - factors affecting results – rates and regulation ” for a description of our rates to our members . non‑member electric sales increased 131,534 mwhs , or 6.5 percent , to 2,158,059 mwhs in 2016 compared to 2,026,525 mwhs in 2015. the increase in mwhs sold was primarily due to 599,045 mwhs in the short-term market , offset by a decrease in firm sales of 467,511 mwhs due to the expiration of several long-term power sales arrangements in march 2016 and december 2015. although non-member electric sales increased , non-member electric sales revenue decreased $ 0.9 million to $ 119.3 million in 2016 compared to $ 120.2 million in 2015. the decrease in non-member electric sales revenue was due to a decrease in firm sales of $ 17.1 million primarily due to the expiration of several long-term power sales arrangements in march 2016 and december 2015. the decrease in non-member electric sales was partially offset by the income recognition of $ 9.2 million of previously deferred non-member electric sales revenue . this recognition in 2016 was required by our board in accordance with its budgetary and rate-setting authority . in addition , non-member electric short‑term market sales increased $ 7.0 million due to the increase in mwhs sold . other operating revenue consists primarily of wheeling , transmission and lease revenues , coal sales , and revenue from supplying steam and water to a paper manufacturer located adjacent to the escalante station . wheeling revenue is received when we charge other energy companies for transmitting electricity over our transmission lines . transmission revenue is from our membership in the spp , a regional transmission organization . the lease revenue is primarily from certain power sales arrangements that are required to be accounted for as operating leases since the arrangements are in substance leases because they convey to others the right to use power generating equipment for a stated period of time . coal sales revenue results from the sale of a portion of the coal from the colowyo mine per a contract ending in 2017 to other joint owners in the yampa project . other revenue decreased $ 2.5 million to $ 87.0 million in 2016 compared to $ 89.5 million in 2015. the decrease in other operating revenue was primarily due to a decrease in lease revenue of $ 12.6 million due to the expiration of power sales arrangements at our knutson and limon generating stations . this decrease was partially offset by a $ 7.9 million increase in transmission revenue resulting from our membership in the spp and a $ 1.1 million increase

liquidity we finance our operations , working capital needs and capital expenditures from operating revenues and issuance of debt . as of december 31 , 2017 , we had $ 143.7 million in cash and cash equivalents . our committed credit arrangement as of december 31 , 2017 is as follows ( dollars in thousands ) : available authorized december 31 , amount 2017 revolving credit agreement $ 750,000 ( 1 ) $ 605,000 ( 2 ) ( 1 ) the amount of this facility that can be used to support commercial paper is limited to $ 500 million . ( 2 ) the portion of this facility that was unavailable at december 31 , 2017 was $ 145 million which was dedicated to support outstanding commercial paper . the revolving credit agreement has aggregate commitments of $ 750 million which includes a swingline sublimit of $ 100 million , a letter of credit sublimit of $ 200 million , and a commercial paper back-up sublimit of $ 500 million , of which $ 100 million of the swingline sublimit , $ 200 million of the letter of credit sublimit , and $ 355 million of the commercial paper back-up sublimit remained available as of december 31 , 2017. as of december 31 , 2017 , we have $ 605 million in availability under the revolving credit agreement . the revolving credit agreement is secured under our master indenture and has a term extending through july 26 , 2019. we expect to renew or replace the revolving credit agreement prior to its expiration . funds advanced under the revolving credit agreement bear interest either at a eurodollar rate or a base rate , at our option . the eurodollar rate is the libor rate for the term of the advance plus a margin ( currently 1.00 % ) based on our credit ratings .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```liquidity we finance our operations , working capital needs and capital expenditures from operating revenues and issuance of debt . as of december 31 , 2017 , we had $ 143.7 million in cash and cash equivalents . our committed credit arrangement as of december 31 , 2017 is as follows ( dollars in thousands ) : available authorized december 31 , amount 2017 revolving credit agreement $ 750,000 ( 1 ) $ 605,000 ( 2 ) ( 1 ) the amount of this facility that can be used to support commercial paper is limited to $ 500 million . ( 2 ) the portion of this facility that was unavailable at december 31 , 2017 was $ 145 million which was dedicated to support outstanding commercial paper . the revolving credit agreement has aggregate commitments of $ 750 million which includes a swingline sublimit of $ 100 million , a letter of credit sublimit of $ 200 million , and a commercial paper back-up sublimit of $ 500 million , of which $ 100 million of the swingline sublimit , $ 200 million of the letter of credit sublimit , and $ 355 million of the commercial paper back-up sublimit remained available as of december 31 , 2017. as of december 31 , 2017 , we have $ 605 million in availability under the revolving credit agreement . the revolving credit agreement is secured under our master indenture and has a term extending through july 26 , 2019. we expect to renew or replace the revolving credit agreement prior to its expiration . funds advanced under the revolving credit agreement bear interest either at a eurodollar rate or a base rate , at our option . the eurodollar rate is the libor rate for the term of the advance plus a margin ( currently 1.00 % ) based on our credit ratings . ``` Suspicious Activity Report : we supply and transmit our members ' electric power requirements through a portfolio of resources , including generating and transmission facilities , long‑term purchase contracts and short‑term energy purchases . we own , lease , have undivided percentage interests in , or have tolling arrangements with respect to , various generating stations . additionally , we transmit power to our members through resources that we own , lease or have undivided percentage interests in , or by wheeling power across lines owned by other transmission providers . see “ business - overview- power supply and transmission ” for a description of miles of transmission lines and substations . depending on our system requirements and contractual obligations , we are likely to both purchase and sell electric power during the same fiscal period . we purchase hydroelectric power under long‑term purchase contracts . 38 these contracts constituted our original power resource , and they remain a cost‑effective power source . we also purchase , under long‑term purchase contracts with basin , all the power which we require to serve our members ' load in the eastern interconnection and fixed scheduled quantities of power in the western interconnection . our generating facilities are located in the western interconnection and generally isolated from our members ' load in the eastern interconnection . these long‑term purchase commitments represent a majority of our electric power purchases . we purchase additional power on a long and short‑term basis , including 477 mws under long-term purchase contracts from other renewable energy resources , including wind , solar and small hydro . at the same time , we have agreed to supply electric power to non‑members . in addition , we utilize market purchases to optimize our position by routinely purchasing power when the market price is lower than our incremental production cost and routinely selling power to the short‑term market after consideration of our incremental production cost when we have excess power available above our firm commitments to both members and non‑members . we also use short-term energy purchases during periods of generation outages at our facilities . 2017 developments we , along with nine other participants , are part of an informal group known as the mwtg , which was formed to develop strategies to adapt to the changing electric industry in the rocky mountain region of the western interconnection . in january 2017 , the mwtg began discussions with the spp to explore potential membership . in september 2017 , the mwtg announced plans to commence negotiations with spp regarding membership . this announcement initiated a formal spp public stakeholder process . our negotiations with spp involve our transmission facilities , generating facilities and loads that are located in the states of colorado and wyoming , along with a small portion in western nebraska and new mexico . our membership in a regional transmission organization in the western interconnection could have many benefits for our system . each of the participating entities will have a multi-step approval process involving some combination of executive , board of director , customer , city , state , and federal approvals . approval from the ferc is also required . critical accounting policies the preparation of our financial statements in conformity with gaap requires that our management make estimates and assumptions that affect the amounts reported in our consolidated financial statements . we base these estimates and assumptions on information available as of the date of the financial statements and they are not necessarily indicative of the results to be expected for the year . we consider the following accounting policies to be critical accounting policies due to the estimation involved or due to the particular significance they have on our consolidated financial statements . accounting for rate regulation . we are a rate-regulated entity and , as a result , are subject to the accounting requirements of accounting for regulated operations . in accordance with these accounting requirements , some revenues and expenses have been deferred at the discretion of our board , which has budgetary and rate‑setting authority , if it is probable that these amounts will be refunded or recovered through future rates . regulatory assets are costs we expect to recover from members based on rates approved by our board in accordance with our rate policy . regulatory liabilities represent probable future reductions in rates associated with amounts that are expected to be refunded to members based on rates approved by our board in accordance with our rate policy . we recognize regulatory assets and liabilities as expenses or as a reduction in expenses concurrent with their recovery in rates . leases . the accounting for lease transactions in conformity with gaap requires management to make various assumptions , including the discount rate , the fair market value of the leased assets and the estimated useful life , in order to determine whether a lease should be classified as operating or capital . we are the lessor under a power sales arrangement that is required to be accounted for as an operating lease since the arrangement is in substance a lease because it conveys the right to use our power generating equipment for a stated period of time . the lease revenue from this arrangement is included in other operating revenue on our consolidated statements of operations . we are the lessee under a power purchase arrangement that is required to be accounted for as an operating lease since the arrangement is in substance a lease because it conveys to us the right to use power generating equipment for a stated period of time . it is included in lease expense on our consolidated statements of operations . 39 asset retirement obligations . we account for current obligations associated with the future retirement of tangible long‑lived assets in accordance with the accounting guidance relating to asset retirement and environmental obligations . story_separator_special_tag arrangement . operating expenses purchased power decreased 79,036 mwhs to 7,249,540 mwhs in 2017 compared to 7,328,576 mwhs in 2016. the decrease in mwhs sold was due to a decrease in short-term market purchases of 328,591 mwhs , partially offset by an increase in long-term renewable energy power purchases of 194,336 mwhs and long-term firm purchases of 55,219 mwhs . although mwhs sold decreased , purchased power expense increased $ 11.4 million to $ 339.8 million in 2017 compared to $ 328.4 million in 2016. the increase in purchased power expense was primarily due to an increase of $ 11.2 million , or 24.8 percent , to $ 56.3 million in 2017 compared to $ 45.1 million in 2016 for relatively similar mwh purchases from a new wind generating facility . our purchases of power from the new wind generating facilities had a higher average cost per mwh for the first six months of 2017 compared to the same period in 2016 when we were paying a lower pre-commercial rate . additionally , purchased power expense from basin increased in 2017 compared to 2016 for relatively similar mwh purchases from basin . our purchases of power from basin had a higher average cost per mwh in 2017 compared 2016 due to basin 's rate increase in the third quarter 2016. the increase in purchase power expense was partially offset by a decrease in short-term market purchases . depreciation , amortization and depletion expense increased $ 0.5 million to $ 174.5 million in 2017 compared to $ 174.0 million in 2016. depreciation expense for generation plant increased $ 9.9 million primarily due to the shortened life associated with the anticipated december 31 , 2022 retirement date of the nucla generating station of $ 8.8 million and due to the shortened life associated with the anticipated december 31 , 2025 retirement date of the craig station 43 unit 1 of $ 2.9 million . depreciation expense for transmission assets decreased $ 6.1 million primarily due to a $ 8.9 million decrease as a result of the transmission rate study , offset by additions of equipment throughout our transmission system . depreciation expense for general plant and other decreased $ 3.3 million primarily due to a $ 5.3 million decrease as a result of the general plant rate study , offset by additions of equipment to our general plant . other income other income decreased $ 2.0 million , or 7.1 percent , to $ 26.6 million in 2017 compared to $ 28.6 million in 2016. the decrease in other income was primarily due to the patronage allocation from basin of $ 7.1 million in 2017 compared to $ 14.4 million for the same period in 2016. the decrease was partially offset by the recognition of $ 5.0 million of deferred membership withdrawal income in 2017. year ended december 31 , 2016 compared to year ended december 31 , 2015 operating revenues member electric sales decreased 34,288 mwhs to 15,746,382 mwhs in 2016 compared to 15,780,670 mwhs in 2015. the withdrawal of kcec in june 2016 resulted in a 138,650 mwhs decrease in 2016 compared to 2015. although mwhs sold decreased in 2016 , member electric sales revenue increased $ 9.0 million to $ 1.135 billion in 2016 compared to $ 1.126 billion in 2015 as a result of the new rate design implemented for 2016. see “ - factors affecting results – rates and regulation ” for a description of our rates to our members . non‑member electric sales increased 131,534 mwhs , or 6.5 percent , to 2,158,059 mwhs in 2016 compared to 2,026,525 mwhs in 2015. the increase in mwhs sold was primarily due to 599,045 mwhs in the short-term market , offset by a decrease in firm sales of 467,511 mwhs due to the expiration of several long-term power sales arrangements in march 2016 and december 2015. although non-member electric sales increased , non-member electric sales revenue decreased $ 0.9 million to $ 119.3 million in 2016 compared to $ 120.2 million in 2015. the decrease in non-member electric sales revenue was due to a decrease in firm sales of $ 17.1 million primarily due to the expiration of several long-term power sales arrangements in march 2016 and december 2015. the decrease in non-member electric sales was partially offset by the income recognition of $ 9.2 million of previously deferred non-member electric sales revenue . this recognition in 2016 was required by our board in accordance with its budgetary and rate-setting authority . in addition , non-member electric short‑term market sales increased $ 7.0 million due to the increase in mwhs sold . other operating revenue consists primarily of wheeling , transmission and lease revenues , coal sales , and revenue from supplying steam and water to a paper manufacturer located adjacent to the escalante station . wheeling revenue is received when we charge other energy companies for transmitting electricity over our transmission lines . transmission revenue is from our membership in the spp , a regional transmission organization . the lease revenue is primarily from certain power sales arrangements that are required to be accounted for as operating leases since the arrangements are in substance leases because they convey to others the right to use power generating equipment for a stated period of time . coal sales revenue results from the sale of a portion of the coal from the colowyo mine per a contract ending in 2017 to other joint owners in the yampa project . other revenue decreased $ 2.5 million to $ 87.0 million in 2016 compared to $ 89.5 million in 2015. the decrease in other operating revenue was primarily due to a decrease in lease revenue of $ 12.6 million due to the expiration of power sales arrangements at our knutson and limon generating stations . this decrease was partially offset by a $ 7.9 million increase in transmission revenue resulting from our membership in the spp and a $ 1.1 million increase

we have some of the best-known offerings in the training industry , including a suite of individual-effectiveness and leadership-development training content based on the best-selling books , the 7 habits of highly effective people , the speed of trust , multipliers , and the 4 disciplines of execution , and proprietary content in the areas of execution , sales performance , productivity , customer loyalty , leadership , and education . we believe that our offerings help individuals , teams , and entire organizations transform their results through achieving systematic , sustainable , and measurable changes in human behavior . our offerings are described in further detail at www.franklincovey.com . the information contained in , or that can be accessed through , our website does not constitute a part of this annual report , and the descriptions found therein should not be viewed as a warranty or guarantee of results . our fiscal year ends on august 31 , and unless otherwise indicated , fiscal 2020 , fiscal 2019 , and fiscal 2018 refer to the twelve-month periods ended august 31 , 2020 , 2019 , 2018 , and so forth . impact of covid-19 pandemic on fiscal 2020 covid-19 was first identified in china during december 2019 , and subsequently declared a pandemic by the world health organization . since its discovery , covid-19 has surfaced in nearly all regions around the world and has resulted in government-imposed travel restrictions and business slowdowns or shutdowns in affected areas . as a result , covid-19 has impacted our business globally , including our licensees , through office and school closures . in particular , these closures impacted our third and fourth quarters of fiscal 2020 as described throughout this annual report on form 10-k for fiscal 2020. after strong financial performance during the first two quarters of fiscal 2020 , our financial results in the third and fourth quarters of fiscal 2020 were adversely impacted by the covid-19 pandemic and the resulting closure of offices and educational institutions throughout the united states and in the countries where we operate direct offices and contract with licensee partners to deliver our offerings . we closed our corporate offices and restricted travel to protect the health and safety of our associates and clients in an effort to slow the spread of the pandemic . our international direct offices also followed the same pattern of closures and restrictions on associate travel and delivery of our offerings . these actions , and similar steps taken by most of our clients , resulted in decreased sales during the third and fourth quarters as previously scheduled onsite events , client-facilitated presentations , and coaching days were postponed or canceled . 25 despite the difficult economic environment in the second half of fiscal 2020 , we were pleased with the continued strength of our subscription sales and the quick pivot to delivering content live-online and through our other digital modalities . our subscription service clients are able to access content and programs from remote locations , which allows continued engagement of personnel and students during long periods of displacement from normal working or classroom conditions . to be successful in our industry , it is important to create effective learning environments for our clients and students , and we believe our previous investments in digital and remote delivery modalities are key to surviving and then thriving in the current environment . according to the training magazine 2020 training industry report , most companies expect to retain at least some aspects of remote learning after the covid-19 pandemic is over . we believe our ability to deliver content and offerings over a broad array of modalities to suit a client 's needs will prove to be a valuable strategic advantage , and we believe these capabilities will accelerate our recovery from the effects of the pandemic and will generate increased opportunities in future periods . however , our recovery from the covid-19 pandemic is dependent upon a number of factors , many of which are not within our control , such as the timing of re-opening national , state , and local economies ; continuing effects of the pandemic on client operations ; and other governmental responses to address the impacts of the pandemic . we will continue to monitor these developments and their actual and potential impacts on our financial position , results of operations , and liquidity . on march 27 , 2020 , in response to covid-19 , the united states government enacted the coronavirus aid , relief , and economic security act ( the cares act ) . the cares act is a relief package consisting of various stimulus measures , such as tax payment deferrals , various business incentives , and makes certain technical corrections to the u.s. tax cuts and jobs act of 2017. while beneficial to the economy and business overall , the enactment of the cares act and similar legislation in other countries throughout the world did not have a material impact on our fiscal 2020 consolidated financial statements . financial overview our fiscal 2020 financial results are a tale of two halves . after strong financial performance during the first two quarters of fiscal 2020 , our financial results in the third and fourth quarters of fiscal 2020 were adversely impacted by the covid-19 pandemic . financial results in the first two quarters of fiscal 2020 showed strong growth in revenues , operating results , and cash flows over the prior year . consolidated sales through february 29 , 2020 grew 8 percent , with enterprise division sales increasing $ 5.0 million , or 6 percent , and education division revenues increasing $ 1.9 million , or 10 percent , compared with the prior year . story_separator_special_tag foreign exchange rates had a $ 0.1 million adverse impact on our direct office segment operating results during fiscal 2020. international licensees segment in countries or foreign locations where we do not have a directly owned office , our training and consulting services are delivered through independent licensees . the following comparative information is for our international licensee operations for the periods indicated ( in thousands ) : replace_table_token_5_th sales . international licensee revenues are primarily comprised of royalty revenues received from our licensee partners . for fiscal 2020 , our licensee revenues were impacted by the covid-19 pandemic , which significantly reduced sales in the second half of the year as many licensee countries enacted economic and social restrictions that prohibited in-person presentations . prior to the full onset of the pandemic , our international licensee royalty revenue during the first two quarters of fiscal 2020 increased by $ 0.2 million compared with the prior year . many of our international licensees had just started to sell the all access pass at the onset of the pandemic and did not have a substantial base of deferred subscription revenue as these operations were primarily dependent upon live onsite training and coaching . due to the benefits of the all access pass , including its digital delivery platform and high revenue retention rates , we believe that our licensees will accelerate their transition to the all access pass in future periods , which we believe will provide significant benefits for our licensee partners and their clients . gross profit . gross profit decreased due to an overall decrease in licensee revenues during fiscal 2020 as described above . licensee gross margin remained strong in fiscal 2020 and was consistent with the prior year . sg & a expenses . international licensee sg & a expenses increased primarily due to additional bad debt expense related to expected collection issues in the wake of the covid-19 pandemic . foreign exchange rates had an insignificant impact on our licensee sales and results of operations during fiscal 2020 . 31 education division our education division is comprised of our domestic and international education practice operations ( focused on sales to educational institutions ) and includes our widely acclaimed leader in me program . the following comparative information is for our education division in the periods indicated ( in thousands ) : replace_table_token_6_th sales . growth in our education division during the first half of fiscal 2020 was offset by decreased sales during the third and fourth quarters , which are generally the busiest months for our education division , resulting from the covid-19 pandemic . despite the significant headwinds faced by educational institutions during the third and fourth quarters as schools closed , teaching moved online , and budgets were constrained , nearly 2,200 existing leader in me schools renewed their leader in me subscriptions ( a number higher than in fiscal 2019 ) and 320 new schools became leader in me schools . we believe these were remarkable achievements in the current education and economic environment . during fiscal 2020 , leader in me subscription revenues increased 11 percent compared with the prior year and our coaches delivered two percent more coaching days as clients pivoted to live on-line delivery of these days . although pandemic-related issues slowed the growth of new schools entering into leader in me agreements in fiscal 2020 , we are optimistic that continued demand for the leader in me program will drive sales growth in future periods . as of august 31 , 2020 , the leader in me program is used in over 4,200 schools and in over 50 countries . gross profit . education segment cost of sales and gross profit decreased primarily due to sales activity as previously described . education division gross margin remained strong at 62.4 percent and was consistent with the prior year 's 62.1 percent . sg & a expenses . education division sg & a expense increased primarily due to investments in additional sales and sales-related personnel in late fiscal 2019 and early fiscal 2020 to fuel growth that was eventually dampened by the continuing covid-19 pandemic , and increased bad debt expense . these increased costs were partially offset by reduced travel and commission expense resulting from travel restrictions and reduced revenues . education division results of operations were adversely impacted by $ 0.2 million of unfavorable exchange rates compared with the prior year . other expenses restructuring costs – during the fourth quarter of fiscal 2020 we restructured certain information technology , corporate operational , and marketing functions . we incurred $ 1.6 million of severance costs related to these restructuring activities . at august 31 , 2020 , we had $ 1.2 million of remaining accrued restructuring costs , which are expected to be paid during fiscal 2021. depreciation – depreciation expense increased $ 0.3 million compared with fiscal 2019 primarily due to the addition of new assets and investments in technology during fiscal 2020 and in prior years . based on previous property and equipment acquisitions , and expected capital additions during fiscal 2021 , we expect depreciation expense will total approximately $ 6.5 million in fiscal 2021. amortization – our amortization expense decreased $ 0.4 million compared with the prior year primarily due to the full amortization of certain intangible assets . we expect the amortization of intangible assets will total approximately $ 4.5 million during fiscal 2021 . 32 income taxes our effective income tax rate for fiscal 2020 was approximately 1,284 percent compared with an effective tax rate of approximately 273 percent in fiscal 2019. the increased effective tax rate in fiscal 2020 was primarily due to $ 11.3 million of additional income tax expense from an increase in the valuation allowance against our deferred income tax assets , which was partially offset by the tax benefit resulting from the exercise of stock options by our ceo and cfo . our near break-even pre-tax

liquidity and capital resources introduction our cash balance at august 31 , 2020 totaled $ 27.1 million , with no borrowings on our $ 15.0 million revolving credit facility . of our $ 27.1 million in cash at august 31 , 2020 , $ 12.2 million was held outside the u.s. by our foreign subsidiaries . we routinely repatriate cash from our foreign subsidiaries and consider cash generated from foreign activities a key component of our overall liquidity position . our primary sources of liquidity are cash flows from the sale of services in the normal course of business and available proceeds from our credit facility . our primary uses of liquidity include payments for operating activities , capital expenditures ( including curriculum development ) , debt payments , contingent consideration payments from the prior acquisition of businesses , working capital expansion , and purchases of our common stock . the following table summarizes our cash flows from operating , investing , and financing activities for the past three years ( in thousands ) : replace_table_token_8_th our current credit agreement on august 7 , 2019 , we entered into a new credit agreement ( the 2019 credit agreement ) with our existing lender , which replaced the amended and restated credit agreement , dated march 2011. the 2019 credit agreement provides up to $ 25.0 million in term loans and a $ 15.0 million revolving line of credit , which expires in august 2024. upon entering into the 2019 credit agreement , we borrowed $ 20.0 million through a term loan and used the proceeds to repay all indebtedness under the original credit agreement . during november 2019 , we borrowed the remaining $ 5.0 million term loan available on the 2019 credit agreement . in anticipation of potential covenant compliance issues associated with the covid-19 pandemic and the uncertainty of the economic recovery , on july 8 , 2020 , we entered into the first modification agreement to the 2019 credit agreement .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```liquidity and capital resources introduction our cash balance at august 31 , 2020 totaled $ 27.1 million , with no borrowings on our $ 15.0 million revolving credit facility . of our $ 27.1 million in cash at august 31 , 2020 , $ 12.2 million was held outside the u.s. by our foreign subsidiaries . we routinely repatriate cash from our foreign subsidiaries and consider cash generated from foreign activities a key component of our overall liquidity position . our primary sources of liquidity are cash flows from the sale of services in the normal course of business and available proceeds from our credit facility . our primary uses of liquidity include payments for operating activities , capital expenditures ( including curriculum development ) , debt payments , contingent consideration payments from the prior acquisition of businesses , working capital expansion , and purchases of our common stock . the following table summarizes our cash flows from operating , investing , and financing activities for the past three years ( in thousands ) : replace_table_token_8_th our current credit agreement on august 7 , 2019 , we entered into a new credit agreement ( the 2019 credit agreement ) with our existing lender , which replaced the amended and restated credit agreement , dated march 2011. the 2019 credit agreement provides up to $ 25.0 million in term loans and a $ 15.0 million revolving line of credit , which expires in august 2024. upon entering into the 2019 credit agreement , we borrowed $ 20.0 million through a term loan and used the proceeds to repay all indebtedness under the original credit agreement . during november 2019 , we borrowed the remaining $ 5.0 million term loan available on the 2019 credit agreement . in anticipation of potential covenant compliance issues associated with the covid-19 pandemic and the uncertainty of the economic recovery , on july 8 , 2020 , we entered into the first modification agreement to the 2019 credit agreement . ``` Suspicious Activity Report : we have some of the best-known offerings in the training industry , including a suite of individual-effectiveness and leadership-development training content based on the best-selling books , the 7 habits of highly effective people , the speed of trust , multipliers , and the 4 disciplines of execution , and proprietary content in the areas of execution , sales performance , productivity , customer loyalty , leadership , and education . we believe that our offerings help individuals , teams , and entire organizations transform their results through achieving systematic , sustainable , and measurable changes in human behavior . our offerings are described in further detail at www.franklincovey.com . the information contained in , or that can be accessed through , our website does not constitute a part of this annual report , and the descriptions found therein should not be viewed as a warranty or guarantee of results . our fiscal year ends on august 31 , and unless otherwise indicated , fiscal 2020 , fiscal 2019 , and fiscal 2018 refer to the twelve-month periods ended august 31 , 2020 , 2019 , 2018 , and so forth . impact of covid-19 pandemic on fiscal 2020 covid-19 was first identified in china during december 2019 , and subsequently declared a pandemic by the world health organization . since its discovery , covid-19 has surfaced in nearly all regions around the world and has resulted in government-imposed travel restrictions and business slowdowns or shutdowns in affected areas . as a result , covid-19 has impacted our business globally , including our licensees , through office and school closures . in particular , these closures impacted our third and fourth quarters of fiscal 2020 as described throughout this annual report on form 10-k for fiscal 2020. after strong financial performance during the first two quarters of fiscal 2020 , our financial results in the third and fourth quarters of fiscal 2020 were adversely impacted by the covid-19 pandemic and the resulting closure of offices and educational institutions throughout the united states and in the countries where we operate direct offices and contract with licensee partners to deliver our offerings . we closed our corporate offices and restricted travel to protect the health and safety of our associates and clients in an effort to slow the spread of the pandemic . our international direct offices also followed the same pattern of closures and restrictions on associate travel and delivery of our offerings . these actions , and similar steps taken by most of our clients , resulted in decreased sales during the third and fourth quarters as previously scheduled onsite events , client-facilitated presentations , and coaching days were postponed or canceled . 25 despite the difficult economic environment in the second half of fiscal 2020 , we were pleased with the continued strength of our subscription sales and the quick pivot to delivering content live-online and through our other digital modalities . our subscription service clients are able to access content and programs from remote locations , which allows continued engagement of personnel and students during long periods of displacement from normal working or classroom conditions . to be successful in our industry , it is important to create effective learning environments for our clients and students , and we believe our previous investments in digital and remote delivery modalities are key to surviving and then thriving in the current environment . according to the training magazine 2020 training industry report , most companies expect to retain at least some aspects of remote learning after the covid-19 pandemic is over . we believe our ability to deliver content and offerings over a broad array of modalities to suit a client 's needs will prove to be a valuable strategic advantage , and we believe these capabilities will accelerate our recovery from the effects of the pandemic and will generate increased opportunities in future periods . however , our recovery from the covid-19 pandemic is dependent upon a number of factors , many of which are not within our control , such as the timing of re-opening national , state , and local economies ; continuing effects of the pandemic on client operations ; and other governmental responses to address the impacts of the pandemic . we will continue to monitor these developments and their actual and potential impacts on our financial position , results of operations , and liquidity . on march 27 , 2020 , in response to covid-19 , the united states government enacted the coronavirus aid , relief , and economic security act ( the cares act ) . the cares act is a relief package consisting of various stimulus measures , such as tax payment deferrals , various business incentives , and makes certain technical corrections to the u.s. tax cuts and jobs act of 2017. while beneficial to the economy and business overall , the enactment of the cares act and similar legislation in other countries throughout the world did not have a material impact on our fiscal 2020 consolidated financial statements . financial overview our fiscal 2020 financial results are a tale of two halves . after strong financial performance during the first two quarters of fiscal 2020 , our financial results in the third and fourth quarters of fiscal 2020 were adversely impacted by the covid-19 pandemic . financial results in the first two quarters of fiscal 2020 showed strong growth in revenues , operating results , and cash flows over the prior year . consolidated sales through february 29 , 2020 grew 8 percent , with enterprise division sales increasing $ 5.0 million , or 6 percent , and education division revenues increasing $ 1.9 million , or 10 percent , compared with the prior year . story_separator_special_tag foreign exchange rates had a $ 0.1 million adverse impact on our direct office segment operating results during fiscal 2020. international licensees segment in countries or foreign locations where we do not have a directly owned office , our training and consulting services are delivered through independent licensees . the following comparative information is for our international licensee operations for the periods indicated ( in thousands ) : replace_table_token_5_th sales . international licensee revenues are primarily comprised of royalty revenues received from our licensee partners . for fiscal 2020 , our licensee revenues were impacted by the covid-19 pandemic , which significantly reduced sales in the second half of the year as many licensee countries enacted economic and social restrictions that prohibited in-person presentations . prior to the full onset of the pandemic , our international licensee royalty revenue during the first two quarters of fiscal 2020 increased by $ 0.2 million compared with the prior year . many of our international licensees had just started to sell the all access pass at the onset of the pandemic and did not have a substantial base of deferred subscription revenue as these operations were primarily dependent upon live onsite training and coaching . due to the benefits of the all access pass , including its digital delivery platform and high revenue retention rates , we believe that our licensees will accelerate their transition to the all access pass in future periods , which we believe will provide significant benefits for our licensee partners and their clients . gross profit . gross profit decreased due to an overall decrease in licensee revenues during fiscal 2020 as described above . licensee gross margin remained strong in fiscal 2020 and was consistent with the prior year . sg & a expenses . international licensee sg & a expenses increased primarily due to additional bad debt expense related to expected collection issues in the wake of the covid-19 pandemic . foreign exchange rates had an insignificant impact on our licensee sales and results of operations during fiscal 2020 . 31 education division our education division is comprised of our domestic and international education practice operations ( focused on sales to educational institutions ) and includes our widely acclaimed leader in me program . the following comparative information is for our education division in the periods indicated ( in thousands ) : replace_table_token_6_th sales . growth in our education division during the first half of fiscal 2020 was offset by decreased sales during the third and fourth quarters , which are generally the busiest months for our education division , resulting from the covid-19 pandemic . despite the significant headwinds faced by educational institutions during the third and fourth quarters as schools closed , teaching moved online , and budgets were constrained , nearly 2,200 existing leader in me schools renewed their leader in me subscriptions ( a number higher than in fiscal 2019 ) and 320 new schools became leader in me schools . we believe these were remarkable achievements in the current education and economic environment . during fiscal 2020 , leader in me subscription revenues increased 11 percent compared with the prior year and our coaches delivered two percent more coaching days as clients pivoted to live on-line delivery of these days . although pandemic-related issues slowed the growth of new schools entering into leader in me agreements in fiscal 2020 , we are optimistic that continued demand for the leader in me program will drive sales growth in future periods . as of august 31 , 2020 , the leader in me program is used in over 4,200 schools and in over 50 countries . gross profit . education segment cost of sales and gross profit decreased primarily due to sales activity as previously described . education division gross margin remained strong at 62.4 percent and was consistent with the prior year 's 62.1 percent . sg & a expenses . education division sg & a expense increased primarily due to investments in additional sales and sales-related personnel in late fiscal 2019 and early fiscal 2020 to fuel growth that was eventually dampened by the continuing covid-19 pandemic , and increased bad debt expense . these increased costs were partially offset by reduced travel and commission expense resulting from travel restrictions and reduced revenues . education division results of operations were adversely impacted by $ 0.2 million of unfavorable exchange rates compared with the prior year . other expenses restructuring costs – during the fourth quarter of fiscal 2020 we restructured certain information technology , corporate operational , and marketing functions . we incurred $ 1.6 million of severance costs related to these restructuring activities . at august 31 , 2020 , we had $ 1.2 million of remaining accrued restructuring costs , which are expected to be paid during fiscal 2021. depreciation – depreciation expense increased $ 0.3 million compared with fiscal 2019 primarily due to the addition of new assets and investments in technology during fiscal 2020 and in prior years . based on previous property and equipment acquisitions , and expected capital additions during fiscal 2021 , we expect depreciation expense will total approximately $ 6.5 million in fiscal 2021. amortization – our amortization expense decreased $ 0.4 million compared with the prior year primarily due to the full amortization of certain intangible assets . we expect the amortization of intangible assets will total approximately $ 4.5 million during fiscal 2021 . 32 income taxes our effective income tax rate for fiscal 2020 was approximately 1,284 percent compared with an effective tax rate of approximately 273 percent in fiscal 2019. the increased effective tax rate in fiscal 2020 was primarily due to $ 11.3 million of additional income tax expense from an increase in the valuation allowance against our deferred income tax assets , which was partially offset by the tax benefit resulting from the exercise of stock options by our ceo and cfo . our near break-even pre-tax

clearance or expiration of the waiting period under german merger control laws remains outstanding . after discussions with the german authorities , e2v and teledyne submitted a revised application for clearance on february 24 , 2017 in respect of the acquisition . the german authorities have one month to review such revised submission . clearance from the french ministry of economy and finance and the french ministry of defense in respect of the acquisition also remains outstanding . teledyne expects to fund the acquisition from cash on hand and its credit facility , as well as the anticipated proceeds from the issuance of senior unsecured notes and term loans . for the machine vision market , e2v provides high performance image sensors and custom camera solutions and application specific standard products . in addition , e2v provides high performance space qualified imaging sensors and arrays for space science and astronomy . e2v also produces components and subsystems that deliver high reliability radio frequency power generation for healthcare , industrial and defense applications . finally , the company provides high reliability semiconductors and board-level solutions for use in aerospace , space and radio frequency communications applications . at announcement , the aggregate enterprise value for the transaction is expected to be approximately £627.1 million ( or approximately $ 788.9 million ) taking into account e2v stock options and net debt . for its fiscal year ended march 31 , 2016 , e2v had sales of approximately £236.4 million . in connection with our strategy , in the third quarter of 2016 , teledyne completed the disposition of the net assets of its printed circuit technology ( “ pct ” ) business for $ 9.3 million in cash , resulting in no gain or loss . pct was part of the aerospace and defense electronics segment . in connection with the sale , we entered into a transition services agreement , effective july 8 , 2016 , to provide certain administrative services to facilitate the orderly transfer of the business operations to the buyer , with the transition services agreement expected to continue through the first half of 2017. in addition , in 2016 we sold a former operating facility in california and recorded a pretax gain of $ 17.9 million , and incurred pretax charges totaling $ 7.9 million related to the pending e2v acquisition . 32 as part of a continuing effort to reduce costs and improve operating performance , we took actions to consolidate and relocate certain facilities and reduce headcount across various businesses , reducing our exposure to weak end markets and high cost locations . we continue to seek cost reductions in our businesses . the following pre-tax charges were incurred related to severance and facility consolidations ( in millions ) : replace_table_token_5_th replace_table_token_6_th replace_table_token_7_th at january 1 , 2017 , $ 3.7 million remains to be paid related to these actions . recent acquisitions the company spent $ 93.4 million , $ 66.7 million and $ 195.8 million on acquisitions and investments in 2016 , 2015 and 2014 , respectively . on november 2 , 2016 , teledyne instruments , inc. acquired assets of in usa , headquartered in norwood , massachusetts , for $ 10.2 million in cash . teledyne intends to relocate and consolidate manufacturing into the new , owned facility of teledyne advanced pollution instrumentation in san diego , california . on december 6 , 2016 , teledyne instruments , inc. acquired hanson research , headquartered in chatsworth , california , for $ 25.0 million , net of cash acquired . on may 3 , 2016 , teledyne dalsa , inc. , a canadian-based subsidiary , acquired the assets and business of caris , based in fredericton , new brunswick , canada , for $ 26.2 million , net of cash acquired . on april 15 , 2016 , teledyne lecroy , inc. , a u.s.-based subsidiary , acquired assets of quantum data , based in elgin , illinois , for $ 17.3 million in cash . on april 6 , 2016 , teledyne lecroy , inc. also acquired frontline , based in charlottesville , virginia , for $ 13.7 million in cash . each of the 2016 acquisitions are part of the instrumentation segment except for caris which is part of the digital imaging segment . on june 5 , 2015 , teledyne dalsa b.v. , a netherlands-based subsidiary , acquired industrial control machines sa ( “ icm ” ) for $ 21.8 million , net of cash acquired . in december 2016 , an additional $ 2.5 million was paid by teledyne related to an indemnification holdback . based in liège , belgium , icm is a leading supplier of portable x-ray generators for non-destructive testing applications , as well as complete x-ray imaging systems for on-site security screening and is part of the digital imaging segment . as a result of the purchase of the remaining interest in optech in 2015 , the difference between the cash paid and the balance of noncontrolling interest was recorded to additional paid-in capital . the balance of the noncontrolling interest of $ 41.2 million at december 28 , 2014 decreased by $ 0.3 million for the net loss and $ 1.3 million in translation adjustments prior to the purchase which eliminated the remaining balance . the balance of the noncontrolling interest of $ 47.0 million at december 29 , 2013 decreased by $ 2.1 million for the net loss and $ 3.7 million in translation adjustments , resulting in a balance of $ 41.2 million at december 28 , 2014. teledyne no longer has any noncontrolling interests . on february 2 , 2015 , teledyne acquired bowtech products limited ( “ bowtech ” ) through a u.k.-based subsidiary for $ 18.9 million in cash , net of cash acquired and including an estimated working capital adjustment . story_separator_special_tag 40 segments the following discussion of our four segments should be read in conjunction with note 12 to the notes to consolidated financial statements . instrumentation replace_table_token_13_th our instrumentation segment provides monitoring and control instruments for marine , environmental , industrial and other applications , as well as electronic test and measurement equipment . we also provide power and communications connectivity devices for distributed instrumentation systems and sensor networks deployed in mission critical , harsh environments . 2016 compared with 2015 our instrumentation segment sales were $ 876.7 million in 2016 compared with sales of $ 1,051.1 million in 2015 , a decrease of 16.6 % . operating income was $ 109.8 million in 2016 , compared with $ 171.0 million in 2015 , a decrease of 35.8 % . the 2016 sales decrease primarily resulted from lower sales of marine instrumentation partially offset by increased sales of test and measurement instrumentation . sales for marine instrumentation decreased $ 195.3 million and primarily reflected lower sales of interconnect systems and other marine sensors for energy exploration and production , as a result of weak energy markets , partially offset by higher sales of interconnects and marine systems for u.s. government applications . sales of test and measurement instrumentation increased $ 19.5 million and included $ 15.4 million in incremental sales from recent acquisitions . sales of environmental instrumentation increased $ 1.4 million . the decrease in operating income primarily reflected the impact of lower sales and also reflected $ 6.8 million in higher severance and facility consolidation costs compared with 2015. the incremental operating profit from recent acquisitions was $ 0.9 million , which included $ 0.8 million in additional intangible asset amortization . cost of sales decreased by $ 95.2 million in 2016 , compared with 2015 , and primarily reflected the impact of lower sales , partially offset by higher severance and facility consolidation expenses . the cost of sales percentage increased slightly to 56.4 % in 2016 from 56.1 % in 2015. selling , general and administrative expenses , including research and development and bid and proposal expense , in 2016 , decreased by $ 18.0 million , compared with 2015 , and primarily reflected the impact of lower sales . selling , general and administrative expenses for 2016 , as a percentage of sales , increased to 31.1 % , compared with 27.6 % for 2015 and reflected the impact of lower sales while certain fixed costs decreased slightly . 2015 compared with 2014 our instrumentation segment sales were $ 1,051.1 million in 2015 compared with sales of $ 1,115.5 million in 2014 , a decrease of 5.8 % . operating income was $ 171.0 million in 2015 , compared with $ 181.6 million in 2014 , a decrease of 5.8 % . the 2015 sales decrease resulted from lower sales of marine instrumentation and electronic test and measurement instrumentation , while sales for environmental instrumentation increased slightly . sales for marine instrumentation decreased by $ 40.8 million and primarily reflected lower sales of geophysical sensors for offshore oil exploration , interconnect systems for land-based energy applications , and other marine sensors and systems , partially offset by $ 32.1 million in incremental sales from recent acquisitions . sales of electronic test and measurement instrumentation decreased $ 23.9 million primarily as a result of lower international sales due in part to the impact of foreign exchange rates . sales of environmental instrumentation increased $ 0.3 million . the decrease in operating income primarily reflected the impact of lower sales as well as $ 2.9 million in higher severance costs compared with 2014. the incremental operating loss from recent acquisitions was $ 4.6 million , which included $ 3.0 million in additional intangible asset amortization . cost of sales decreased by $ 40.2 million in 2015 , compared with 2014 , and primarily reflected the impact of lower sales . the cost of sales percentage decreased slightly to 56.1 % from 56.5 % . selling , general and administrative expenses , including research and development and bid and proposal expense , in 2015 , decreased by $ 13.6 million , compared with 2014 , and 41 primarily reflected the impact of lower sales . selling , general and administrative expenses for 2015 , as a percentage of sales , increased slightly to 27.6 % , compared with 27.2 % for 2014. digital imaging replace_table_token_14_th our digital imaging segment includes high-performance sensors , cameras and systems , within the visible , infrared and x-ray spectra for use in industrial , government and medical applications , as well as micro electro-mechanical systems ( “ mems ” ) . it also includes our sponsored and centralized research laboratories which benefit government programs and commercial businesses . 2016 compared with 2015 our digital imaging segment sales were $ 398.7 million in 2016 , compared with sales of $ 379.0 million in 2015 , an increase of 5.2 % . operating income was $ 45.9 million in 2016 , compared with $ 40.0 million in 2015 , an increase of 14.8 % . the 2016 sales increase primarily reflected higher sales of sensors and systems for life sciences and industrial x-ray applications , mems and geospatial software . sales in 2016 included $ 9.6 million in incremental sales from recent acquisitions . the increase in operating income in 2016 , compared with 2015 , reflected the impact of higher sales and favorable product mix . the incremental operating loss included in the results for 2016 from recent acquisitions was $ 1.5 million , which included $ 0.5 million in additional intangible asset amortization expense . cost of sales for 2016 increased by $ 11.4 million , compared with 2015 , and primarily reflected the impact of higher sales . the cost of sales percentage in 2016 decreased slightly . selling , general and administrative expenses , for 2016 , increased to $ 113.4 million , compared with $ 111.0 million in 2015

net cash used in investing activities was $ 151.0 million , $ 109.9 million and $ 238.7 million for 2016 , 2015 and 2014 , respectively . cash flows relating to investing activities consists primarily of cash used for acquisitions and capital expenditures , except 2016 also includes $ 9.3 million of cash received from the sale of a business and cash received of $ 19.5 million from the sale of a former operating facility . replace_table_token_21_th the increase in capital spending in 2016 , compared with 2015 , primarily reflected the purchase of an operating facility . during 2017 we plan to invest approximately $ 60.0 million in capital expenditures , principally to upgrade capital equipment , reduce manufacturing costs and introduce new products . commitments at january 1 , 2017 , for capital expenditures were approximately $ 9.5 million . acquisitions investing activities used cash for acquisitions and investments of $ 93.4 million , $ 66.7 million and $ 195.8 million , in 2016 , 2015 and 2014 , respectively ( see “ recent acquisitions ” ) . teledyne funded the acquisitions primarily from borrowings under its credit facility and cash on hand . for all acquisitions , the results of operations and cash flows are included in our consolidated financial statements from the date of each respective acquisition . the caris , icm and axiom acquisitions are part of the digital imaging segment . all other acquisitions in 2016 , 2015 and 2014 are part of the instrumentation segment . 48 the following table shows the purchase price ( net of cash acquired ) , goodwill acquired and intangible assets acquired for the acquisitions and other investments made in 2016 and 2015 ( in millions ) : replace_table_token_22_th goodwill resulting from the acquisitions of frontline , quantum data , in usa and caris made in 2016 will be deductible for tax purposes . goodwill resulting from the 2016 acquisition of hanson research and the 2015 acquisitions of bowtech and icm will not be deductible for tax purposes .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```net cash used in investing activities was $ 151.0 million , $ 109.9 million and $ 238.7 million for 2016 , 2015 and 2014 , respectively . cash flows relating to investing activities consists primarily of cash used for acquisitions and capital expenditures , except 2016 also includes $ 9.3 million of cash received from the sale of a business and cash received of $ 19.5 million from the sale of a former operating facility . replace_table_token_21_th the increase in capital spending in 2016 , compared with 2015 , primarily reflected the purchase of an operating facility . during 2017 we plan to invest approximately $ 60.0 million in capital expenditures , principally to upgrade capital equipment , reduce manufacturing costs and introduce new products . commitments at january 1 , 2017 , for capital expenditures were approximately $ 9.5 million . acquisitions investing activities used cash for acquisitions and investments of $ 93.4 million , $ 66.7 million and $ 195.8 million , in 2016 , 2015 and 2014 , respectively ( see “ recent acquisitions ” ) . teledyne funded the acquisitions primarily from borrowings under its credit facility and cash on hand . for all acquisitions , the results of operations and cash flows are included in our consolidated financial statements from the date of each respective acquisition . the caris , icm and axiom acquisitions are part of the digital imaging segment . all other acquisitions in 2016 , 2015 and 2014 are part of the instrumentation segment . 48 the following table shows the purchase price ( net of cash acquired ) , goodwill acquired and intangible assets acquired for the acquisitions and other investments made in 2016 and 2015 ( in millions ) : replace_table_token_22_th goodwill resulting from the acquisitions of frontline , quantum data , in usa and caris made in 2016 will be deductible for tax purposes . goodwill resulting from the 2016 acquisition of hanson research and the 2015 acquisitions of bowtech and icm will not be deductible for tax purposes . ``` Suspicious Activity Report : clearance or expiration of the waiting period under german merger control laws remains outstanding . after discussions with the german authorities , e2v and teledyne submitted a revised application for clearance on february 24 , 2017 in respect of the acquisition . the german authorities have one month to review such revised submission . clearance from the french ministry of economy and finance and the french ministry of defense in respect of the acquisition also remains outstanding . teledyne expects to fund the acquisition from cash on hand and its credit facility , as well as the anticipated proceeds from the issuance of senior unsecured notes and term loans . for the machine vision market , e2v provides high performance image sensors and custom camera solutions and application specific standard products . in addition , e2v provides high performance space qualified imaging sensors and arrays for space science and astronomy . e2v also produces components and subsystems that deliver high reliability radio frequency power generation for healthcare , industrial and defense applications . finally , the company provides high reliability semiconductors and board-level solutions for use in aerospace , space and radio frequency communications applications . at announcement , the aggregate enterprise value for the transaction is expected to be approximately £627.1 million ( or approximately $ 788.9 million ) taking into account e2v stock options and net debt . for its fiscal year ended march 31 , 2016 , e2v had sales of approximately £236.4 million . in connection with our strategy , in the third quarter of 2016 , teledyne completed the disposition of the net assets of its printed circuit technology ( “ pct ” ) business for $ 9.3 million in cash , resulting in no gain or loss . pct was part of the aerospace and defense electronics segment . in connection with the sale , we entered into a transition services agreement , effective july 8 , 2016 , to provide certain administrative services to facilitate the orderly transfer of the business operations to the buyer , with the transition services agreement expected to continue through the first half of 2017. in addition , in 2016 we sold a former operating facility in california and recorded a pretax gain of $ 17.9 million , and incurred pretax charges totaling $ 7.9 million related to the pending e2v acquisition . 32 as part of a continuing effort to reduce costs and improve operating performance , we took actions to consolidate and relocate certain facilities and reduce headcount across various businesses , reducing our exposure to weak end markets and high cost locations . we continue to seek cost reductions in our businesses . the following pre-tax charges were incurred related to severance and facility consolidations ( in millions ) : replace_table_token_5_th replace_table_token_6_th replace_table_token_7_th at january 1 , 2017 , $ 3.7 million remains to be paid related to these actions . recent acquisitions the company spent $ 93.4 million , $ 66.7 million and $ 195.8 million on acquisitions and investments in 2016 , 2015 and 2014 , respectively . on november 2 , 2016 , teledyne instruments , inc. acquired assets of in usa , headquartered in norwood , massachusetts , for $ 10.2 million in cash . teledyne intends to relocate and consolidate manufacturing into the new , owned facility of teledyne advanced pollution instrumentation in san diego , california . on december 6 , 2016 , teledyne instruments , inc. acquired hanson research , headquartered in chatsworth , california , for $ 25.0 million , net of cash acquired . on may 3 , 2016 , teledyne dalsa , inc. , a canadian-based subsidiary , acquired the assets and business of caris , based in fredericton , new brunswick , canada , for $ 26.2 million , net of cash acquired . on april 15 , 2016 , teledyne lecroy , inc. , a u.s.-based subsidiary , acquired assets of quantum data , based in elgin , illinois , for $ 17.3 million in cash . on april 6 , 2016 , teledyne lecroy , inc. also acquired frontline , based in charlottesville , virginia , for $ 13.7 million in cash . each of the 2016 acquisitions are part of the instrumentation segment except for caris which is part of the digital imaging segment . on june 5 , 2015 , teledyne dalsa b.v. , a netherlands-based subsidiary , acquired industrial control machines sa ( “ icm ” ) for $ 21.8 million , net of cash acquired . in december 2016 , an additional $ 2.5 million was paid by teledyne related to an indemnification holdback . based in liège , belgium , icm is a leading supplier of portable x-ray generators for non-destructive testing applications , as well as complete x-ray imaging systems for on-site security screening and is part of the digital imaging segment . as a result of the purchase of the remaining interest in optech in 2015 , the difference between the cash paid and the balance of noncontrolling interest was recorded to additional paid-in capital . the balance of the noncontrolling interest of $ 41.2 million at december 28 , 2014 decreased by $ 0.3 million for the net loss and $ 1.3 million in translation adjustments prior to the purchase which eliminated the remaining balance . the balance of the noncontrolling interest of $ 47.0 million at december 29 , 2013 decreased by $ 2.1 million for the net loss and $ 3.7 million in translation adjustments , resulting in a balance of $ 41.2 million at december 28 , 2014. teledyne no longer has any noncontrolling interests . on february 2 , 2015 , teledyne acquired bowtech products limited ( “ bowtech ” ) through a u.k.-based subsidiary for $ 18.9 million in cash , net of cash acquired and including an estimated working capital adjustment . story_separator_special_tag 40 segments the following discussion of our four segments should be read in conjunction with note 12 to the notes to consolidated financial statements . instrumentation replace_table_token_13_th our instrumentation segment provides monitoring and control instruments for marine , environmental , industrial and other applications , as well as electronic test and measurement equipment . we also provide power and communications connectivity devices for distributed instrumentation systems and sensor networks deployed in mission critical , harsh environments . 2016 compared with 2015 our instrumentation segment sales were $ 876.7 million in 2016 compared with sales of $ 1,051.1 million in 2015 , a decrease of 16.6 % . operating income was $ 109.8 million in 2016 , compared with $ 171.0 million in 2015 , a decrease of 35.8 % . the 2016 sales decrease primarily resulted from lower sales of marine instrumentation partially offset by increased sales of test and measurement instrumentation . sales for marine instrumentation decreased $ 195.3 million and primarily reflected lower sales of interconnect systems and other marine sensors for energy exploration and production , as a result of weak energy markets , partially offset by higher sales of interconnects and marine systems for u.s. government applications . sales of test and measurement instrumentation increased $ 19.5 million and included $ 15.4 million in incremental sales from recent acquisitions . sales of environmental instrumentation increased $ 1.4 million . the decrease in operating income primarily reflected the impact of lower sales and also reflected $ 6.8 million in higher severance and facility consolidation costs compared with 2015. the incremental operating profit from recent acquisitions was $ 0.9 million , which included $ 0.8 million in additional intangible asset amortization . cost of sales decreased by $ 95.2 million in 2016 , compared with 2015 , and primarily reflected the impact of lower sales , partially offset by higher severance and facility consolidation expenses . the cost of sales percentage increased slightly to 56.4 % in 2016 from 56.1 % in 2015. selling , general and administrative expenses , including research and development and bid and proposal expense , in 2016 , decreased by $ 18.0 million , compared with 2015 , and primarily reflected the impact of lower sales . selling , general and administrative expenses for 2016 , as a percentage of sales , increased to 31.1 % , compared with 27.6 % for 2015 and reflected the impact of lower sales while certain fixed costs decreased slightly . 2015 compared with 2014 our instrumentation segment sales were $ 1,051.1 million in 2015 compared with sales of $ 1,115.5 million in 2014 , a decrease of 5.8 % . operating income was $ 171.0 million in 2015 , compared with $ 181.6 million in 2014 , a decrease of 5.8 % . the 2015 sales decrease resulted from lower sales of marine instrumentation and electronic test and measurement instrumentation , while sales for environmental instrumentation increased slightly . sales for marine instrumentation decreased by $ 40.8 million and primarily reflected lower sales of geophysical sensors for offshore oil exploration , interconnect systems for land-based energy applications , and other marine sensors and systems , partially offset by $ 32.1 million in incremental sales from recent acquisitions . sales of electronic test and measurement instrumentation decreased $ 23.9 million primarily as a result of lower international sales due in part to the impact of foreign exchange rates . sales of environmental instrumentation increased $ 0.3 million . the decrease in operating income primarily reflected the impact of lower sales as well as $ 2.9 million in higher severance costs compared with 2014. the incremental operating loss from recent acquisitions was $ 4.6 million , which included $ 3.0 million in additional intangible asset amortization . cost of sales decreased by $ 40.2 million in 2015 , compared with 2014 , and primarily reflected the impact of lower sales . the cost of sales percentage decreased slightly to 56.1 % from 56.5 % . selling , general and administrative expenses , including research and development and bid and proposal expense , in 2015 , decreased by $ 13.6 million , compared with 2014 , and 41 primarily reflected the impact of lower sales . selling , general and administrative expenses for 2015 , as a percentage of sales , increased slightly to 27.6 % , compared with 27.2 % for 2014. digital imaging replace_table_token_14_th our digital imaging segment includes high-performance sensors , cameras and systems , within the visible , infrared and x-ray spectra for use in industrial , government and medical applications , as well as micro electro-mechanical systems ( “ mems ” ) . it also includes our sponsored and centralized research laboratories which benefit government programs and commercial businesses . 2016 compared with 2015 our digital imaging segment sales were $ 398.7 million in 2016 , compared with sales of $ 379.0 million in 2015 , an increase of 5.2 % . operating income was $ 45.9 million in 2016 , compared with $ 40.0 million in 2015 , an increase of 14.8 % . the 2016 sales increase primarily reflected higher sales of sensors and systems for life sciences and industrial x-ray applications , mems and geospatial software . sales in 2016 included $ 9.6 million in incremental sales from recent acquisitions . the increase in operating income in 2016 , compared with 2015 , reflected the impact of higher sales and favorable product mix . the incremental operating loss included in the results for 2016 from recent acquisitions was $ 1.5 million , which included $ 0.5 million in additional intangible asset amortization expense . cost of sales for 2016 increased by $ 11.4 million , compared with 2015 , and primarily reflected the impact of higher sales . the cost of sales percentage in 2016 decreased slightly . selling , general and administrative expenses , for 2016 , increased to $ 113.4 million , compared with $ 111.0 million in 2015

35 overview the new home company finished the year on a strong note with solid progress made across many key operating metrics during the fourth quarter . robust demand for new housing resulted in an 89 % increase in net new orders in the fourth quarter . the company 's quarterly sales absorption rates improved sequentially throughout 2020 and ended the year strong , with december 's monthly sales absorption pace of 4.4 representing the highest monthly net order total in the company 's history . while the company 's affordable product offerings continue to grow as a percentage of its total community offerings , new home demand was evident across all product segments and contributed to ending 2020 with a strong level of the number of homes in backlog , up 175 % as compared to the end of 2019. the increase in sales pace and improved pricing power experienced in the latter half of 2020 provided opportunities for meaningful price increases at nearly all of the company 's communities and contributed to an increase in gross margin . homebuilding gross margin for 2020 was 9.4 % and included $ 19.0 million in inventory impairment charges . homebuilding gross margin for 2019 was 10.2 % and included $ 8.3 million in inventory impairment charges . excluding impairment charges , homebuilding gross margin for 2020 was 13.9 % * as compared to 11.8 % * in 2019 , and excluding impairment charges and interest in cost of home sales , homebuilding gross margin for 2020 was 19.5 % * as compared to 16.7 % * in 2019 , a 280 basis point improvement * . total revenues for the year ended december 31 , 2020 were $ 507.4 million compared to $ 669.3 million for the prior year . the year-over-year decrease in revenues was driven largely by a 20 % decrease in home sales revenue , a $ 41.5 million decrease in land sales revenue and , to a lesser extent , a 15 % decrease in fee building revenue as a result of a decrease in construction activity at fee building communities in irvine , california . for the full year 2020 , the net loss attributable to the company was $ 32.8 million , or $ ( 1.76 ) per diluted share . adjusted net income for 2020 was $ 3.6 million * , or $ 0.19 per diluted share * , and excluded pretax charges of $ 19.0 million in inventory impairment charges , $ 22.3 million in joint venture impairment charges , a $ 14.0 million project abandonment charge , an $ 8.0 million debt refinance charge and $ 1.1 million in severance charges . the company 's net loss for 2019 was $ 8.0 million , or $ ( 0.40 ) per diluted share . adjusted net income for 2019 was $ 4.6 million * , or $ 0.23 per diluted share * , after excluding pretax charges of $ 10.2 million in inventory impairment charges , including $ 1.9 million related to a land sale , a $ 3.5 million joint venture impairment charge , $ 1.8 million in severance charges and $ 1.5 million in land sales losses . the year-over-year increase in net loss was primarily attributable to the $ 41.6 million pretax increase in impairment and project abandonment charges , an $ 8.4 million increase in debt extinguishment charges , a $ 3.7 million increase in interest expense and a 20 % decrease in home sale revenues . these decreases were partially offset by an improvement in gross margins excluding impairments and an increase in income tax benefit as a result of the cares act . the company generated operating cash flow of $ 93.1 million during 2020 and ended the year with $ 107.3 million in cash and cash equivalents and had no borrowings outstanding under its revolving credit facility . the company also strengthened its balance sheet by refinancing its senior notes to october 2025 , reduced its debt outstanding by $ 60 million during 2020 , and extended the maturity date of its bank credit facility to april 2023. at december 31 , 2020 , the company had a debt-to-capital ratio of 55.4 % and a net debt-to-capital ratio of 41.0 % * , which represented an 820-basis point improvement compared to 2019. the company also repurchased 2,160,792 shares of our common stock during 2020 for $ 4.3 million . in connection with the net operating loss carryback tax benefit recognized during 2020 as a result of the cares act , the company had approximately $ 27.4 million of expected federal income tax refunds receivable recorded as of december 31 , 2020. in addition , the company made significant progress during 2020 to wind down its joint venture activities in order to reduce its related capital commitments , and is actively looking to reinvest its capital in areas where it believes such investments will yield results that meet its investment criteria . the company had reduced the level of land acquisition over the last year as a result of its focus to generate cash flows and reduce its leverage , however , the company has been actively evaluating new land opportunities to rebuild its pipeline as economic conditions have improved over the past few months , especially for the homebuilding industry . the company plans to execute a balanced approach of acquiring new land positions and improving our operating metrics to generate positive shareholder returns . although economic conditions have improved since mid-march and april , in particular for the housing industry , we remain cautious as to the impact of the covid-19 pandemic on the economy , among other things . despite the uncertainty related to this pandemic , we believe pent up demand for housing continues to be strong and that the new home company is on more solid footing moving forward . story_separator_special_tag in northern california , home sales revenue for 2020 increased 2 % due to a 14 % increase in homes delivered , partially offset by a 10 % decrease in average selling price related to a shift in deliveries from the higher-priced bay area to the more-affordable sacramento region . homebuilding gross margin homebuilding gross margin for 2020 was 9.4 % compared to 10.2 % in the prior year . the 2020 period included $ 19.0 million in noncash inventory impairment charges related to five homebuilding communities experiencing slower sales pace due to the covid-19 pandemic , resulting in higher incentives and carrying costs for these projects . the 2019 period included $ 8.3 million in noncash inventory impairment charges related to one luxury condominium community in scottsdale , arizona with slow monthly sales absorption that required sales price adjustments and one higher-priced homebuilding community within the inland empire in southern california that required more incentives than originally expected . for more information on these impairments , please refer to note 4 of our consolidated financial statements . excluding impairment charges , homebuilding gross margin was 13.9 % for 2020 as compared to 11.8 % for 2019. the 210 basis point increase in homebuilding gross margin before impairments was primarily due to a product mix shift and improved pricing power experienced in the latter half of 2020. the positive product mix shift was driven by a higher percentage of our total homes sales revenue generated at more affordably-priced communities , which have had higher gross margins . these items were partially offset by a 70 basis point increase in interest costs included in cost of home sales . adjusted homebuilding gross margin , which excludes homes sales impairments and interest in cost of home sales , was 19.5 % and 16.7 % for the years ended december 31 , 2020 and 2019 , respectively . 42 homebuilding gross margin before impairments and adjusted homebuilding gross margin are non-gaap measures . see the table below reconciling these non-gaap financial measures to homebuilding gross margin , the nearest gaap equivalent . replace_table_token_14_th ( 1 ) homebuilding gross margin before impairments and adjusted homebuilding gross margin are non-gaap financial measures . these measures isolate the impact that home sales impairments and leverage have on homebuilding gross margin . we believe this information is meaningful as it allows investors to evaluate metrics of our ongoing homebuilding operations without the impact of isolated events and interest costs and permits investors to make better comparisons with our competitors who also break out and adjust gross margins in a similar fashion . land sales during 2020 , the company recognized $ 0.2 million of deferred revenue for the remaining completed work on a land sale that initially occurred during 2019. during 2019 , the company sold three land parcels in northern california that generat ed $ 41.7 milli on in land sales revenue . in connection with the 2019 land sales , the company recorded a pretax lo ss from these sales of $ 3.4 mill ion , which included a $ 1.9 million impairment charge booked in the 2019 third quarter related to land that closed during the 2019 fourth quarter . the company sold lots as part of a strategic decision to generate cash flow and reduce our concentration of capital investments in certain markets . fee building replace_table_token_15_th for the year ended december 31 , 2020 , fee building revenues decreased 15 % from 2019 , driven by a decrease in construction activity at fee building communities in irvine , california . in august 2020 , irvine pacific , our largest customer , made a decision to begin building homes using their own general contractor 's license , effectively terminating our fee building arrangement with irvine pacific moving forward . although we are transitioning construction management responsibilities to irvine pacific and are not expected to be engaged for new fee building contracts with them going forward , we are currently in the process of finishing certain existing homes under construction and generating revenues in connection therewith , which we expect to continue through the first quarter of 2021. the company is actively seeking and entering into new fee building opportunities with other land developers with the objective of at least partially offsetting the expected reduction in irvine pacific business in future years , such as our new fee building relationship with fivepoint in irvine , california . included in fee building revenues for the years ended december 31 , 2020 and 2019 were ( i ) $ 78.7 million and $ 91.5 million of billings to land owners , respectively , and ( ii ) $ 2.3 million and $ 3.8 million of management fees from our unconsolidated joint ventures and third-party land owners , respectively . the cost of fee building decreased for the year ended december 31 , 2020 compared to 2019 primarily due to the decrease in fee building activity mentioned above and to a lesser extent , lower allocated general and administrative ( `` g & a `` ) expenses . the amount of g & a expenses included in the cost of fee building was $ 3.6 million and $ 5.4 million for the years ended december 31 , 2020 and 2019 , respectively . fee building gross margin decreased to $ 1.4 million for the year ended december 31 , 2020 from $ 2.1 million in the prior year period primarily due to lower fee billings and reduced management fees , which was partially offset by lower allocated g & a expenses . our fee building revenue has historically been concentrated with a small number of customers . for the years ended december 31 , 2020 , 2019 and 2018 , irvine pacific comprised 91 % , 95 % and 95 % of fee building revenue , respectively . 43 selling , general and administrative expenses replace_table_token_16_th during 2020 , our sg & a rate as a percentage

cash flows for t he year ended december 31 , 2020 as compared to the year ended december 31 , 2019 , the comparison of cash flows is as follows : net cash provided by operating activities was $ 93.1 million for the year ended december 31 , 2020 versus $ 121.3 million for the year ended december 31 , 2019. the year-over-year change was primarily a result of reduction in real estate inventories of $ 85.2 million for 2020 as compared to $ 123.2 million for 2019. the change in real estate inventories cash flow was driven primarily by the decrease in home and land sales revenues , partially offset by a year-over-year decrease in land acquisition , development and construction in progress spend during 2020 . the year-over-year increase in net loss reduced cash inflow by $ 24.9 million . the lower cash flows in 2020 also reflect an increase in other assets primarily consisting of an increase of $ 26.8 million due to expected income tax refunds . these items were offset by an increase in noncash inventory impairments and project abandonment costs of $ 22.8 million , and an $ 18.8 million increase in noncash impairments to the company 's investment in two unconsolidated joint ventures recorded during the year ended december 31 , 2020. the remaining year-over-year change in operating cash flows related to changes in contracts and accounts receivable , accounts payable , accrued expenses and other liabilities , and deferredtax assets balances as well as the company 's loss on early extinguishment of debt during 2020. net cash provided by investing activities was $ 9.0 million and $ 0.3 million for the years ended december 31 , 2020 and 2019 , respectively .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```cash flows for t he year ended december 31 , 2020 as compared to the year ended december 31 , 2019 , the comparison of cash flows is as follows : net cash provided by operating activities was $ 93.1 million for the year ended december 31 , 2020 versus $ 121.3 million for the year ended december 31 , 2019. the year-over-year change was primarily a result of reduction in real estate inventories of $ 85.2 million for 2020 as compared to $ 123.2 million for 2019. the change in real estate inventories cash flow was driven primarily by the decrease in home and land sales revenues , partially offset by a year-over-year decrease in land acquisition , development and construction in progress spend during 2020 . the year-over-year increase in net loss reduced cash inflow by $ 24.9 million . the lower cash flows in 2020 also reflect an increase in other assets primarily consisting of an increase of $ 26.8 million due to expected income tax refunds . these items were offset by an increase in noncash inventory impairments and project abandonment costs of $ 22.8 million , and an $ 18.8 million increase in noncash impairments to the company 's investment in two unconsolidated joint ventures recorded during the year ended december 31 , 2020. the remaining year-over-year change in operating cash flows related to changes in contracts and accounts receivable , accounts payable , accrued expenses and other liabilities , and deferredtax assets balances as well as the company 's loss on early extinguishment of debt during 2020. net cash provided by investing activities was $ 9.0 million and $ 0.3 million for the years ended december 31 , 2020 and 2019 , respectively . ``` Suspicious Activity Report : 35 overview the new home company finished the year on a strong note with solid progress made across many key operating metrics during the fourth quarter . robust demand for new housing resulted in an 89 % increase in net new orders in the fourth quarter . the company 's quarterly sales absorption rates improved sequentially throughout 2020 and ended the year strong , with december 's monthly sales absorption pace of 4.4 representing the highest monthly net order total in the company 's history . while the company 's affordable product offerings continue to grow as a percentage of its total community offerings , new home demand was evident across all product segments and contributed to ending 2020 with a strong level of the number of homes in backlog , up 175 % as compared to the end of 2019. the increase in sales pace and improved pricing power experienced in the latter half of 2020 provided opportunities for meaningful price increases at nearly all of the company 's communities and contributed to an increase in gross margin . homebuilding gross margin for 2020 was 9.4 % and included $ 19.0 million in inventory impairment charges . homebuilding gross margin for 2019 was 10.2 % and included $ 8.3 million in inventory impairment charges . excluding impairment charges , homebuilding gross margin for 2020 was 13.9 % * as compared to 11.8 % * in 2019 , and excluding impairment charges and interest in cost of home sales , homebuilding gross margin for 2020 was 19.5 % * as compared to 16.7 % * in 2019 , a 280 basis point improvement * . total revenues for the year ended december 31 , 2020 were $ 507.4 million compared to $ 669.3 million for the prior year . the year-over-year decrease in revenues was driven largely by a 20 % decrease in home sales revenue , a $ 41.5 million decrease in land sales revenue and , to a lesser extent , a 15 % decrease in fee building revenue as a result of a decrease in construction activity at fee building communities in irvine , california . for the full year 2020 , the net loss attributable to the company was $ 32.8 million , or $ ( 1.76 ) per diluted share . adjusted net income for 2020 was $ 3.6 million * , or $ 0.19 per diluted share * , and excluded pretax charges of $ 19.0 million in inventory impairment charges , $ 22.3 million in joint venture impairment charges , a $ 14.0 million project abandonment charge , an $ 8.0 million debt refinance charge and $ 1.1 million in severance charges . the company 's net loss for 2019 was $ 8.0 million , or $ ( 0.40 ) per diluted share . adjusted net income for 2019 was $ 4.6 million * , or $ 0.23 per diluted share * , after excluding pretax charges of $ 10.2 million in inventory impairment charges , including $ 1.9 million related to a land sale , a $ 3.5 million joint venture impairment charge , $ 1.8 million in severance charges and $ 1.5 million in land sales losses . the year-over-year increase in net loss was primarily attributable to the $ 41.6 million pretax increase in impairment and project abandonment charges , an $ 8.4 million increase in debt extinguishment charges , a $ 3.7 million increase in interest expense and a 20 % decrease in home sale revenues . these decreases were partially offset by an improvement in gross margins excluding impairments and an increase in income tax benefit as a result of the cares act . the company generated operating cash flow of $ 93.1 million during 2020 and ended the year with $ 107.3 million in cash and cash equivalents and had no borrowings outstanding under its revolving credit facility . the company also strengthened its balance sheet by refinancing its senior notes to october 2025 , reduced its debt outstanding by $ 60 million during 2020 , and extended the maturity date of its bank credit facility to april 2023. at december 31 , 2020 , the company had a debt-to-capital ratio of 55.4 % and a net debt-to-capital ratio of 41.0 % * , which represented an 820-basis point improvement compared to 2019. the company also repurchased 2,160,792 shares of our common stock during 2020 for $ 4.3 million . in connection with the net operating loss carryback tax benefit recognized during 2020 as a result of the cares act , the company had approximately $ 27.4 million of expected federal income tax refunds receivable recorded as of december 31 , 2020. in addition , the company made significant progress during 2020 to wind down its joint venture activities in order to reduce its related capital commitments , and is actively looking to reinvest its capital in areas where it believes such investments will yield results that meet its investment criteria . the company had reduced the level of land acquisition over the last year as a result of its focus to generate cash flows and reduce its leverage , however , the company has been actively evaluating new land opportunities to rebuild its pipeline as economic conditions have improved over the past few months , especially for the homebuilding industry . the company plans to execute a balanced approach of acquiring new land positions and improving our operating metrics to generate positive shareholder returns . although economic conditions have improved since mid-march and april , in particular for the housing industry , we remain cautious as to the impact of the covid-19 pandemic on the economy , among other things . despite the uncertainty related to this pandemic , we believe pent up demand for housing continues to be strong and that the new home company is on more solid footing moving forward . story_separator_special_tag in northern california , home sales revenue for 2020 increased 2 % due to a 14 % increase in homes delivered , partially offset by a 10 % decrease in average selling price related to a shift in deliveries from the higher-priced bay area to the more-affordable sacramento region . homebuilding gross margin homebuilding gross margin for 2020 was 9.4 % compared to 10.2 % in the prior year . the 2020 period included $ 19.0 million in noncash inventory impairment charges related to five homebuilding communities experiencing slower sales pace due to the covid-19 pandemic , resulting in higher incentives and carrying costs for these projects . the 2019 period included $ 8.3 million in noncash inventory impairment charges related to one luxury condominium community in scottsdale , arizona with slow monthly sales absorption that required sales price adjustments and one higher-priced homebuilding community within the inland empire in southern california that required more incentives than originally expected . for more information on these impairments , please refer to note 4 of our consolidated financial statements . excluding impairment charges , homebuilding gross margin was 13.9 % for 2020 as compared to 11.8 % for 2019. the 210 basis point increase in homebuilding gross margin before impairments was primarily due to a product mix shift and improved pricing power experienced in the latter half of 2020. the positive product mix shift was driven by a higher percentage of our total homes sales revenue generated at more affordably-priced communities , which have had higher gross margins . these items were partially offset by a 70 basis point increase in interest costs included in cost of home sales . adjusted homebuilding gross margin , which excludes homes sales impairments and interest in cost of home sales , was 19.5 % and 16.7 % for the years ended december 31 , 2020 and 2019 , respectively . 42 homebuilding gross margin before impairments and adjusted homebuilding gross margin are non-gaap measures . see the table below reconciling these non-gaap financial measures to homebuilding gross margin , the nearest gaap equivalent . replace_table_token_14_th ( 1 ) homebuilding gross margin before impairments and adjusted homebuilding gross margin are non-gaap financial measures . these measures isolate the impact that home sales impairments and leverage have on homebuilding gross margin . we believe this information is meaningful as it allows investors to evaluate metrics of our ongoing homebuilding operations without the impact of isolated events and interest costs and permits investors to make better comparisons with our competitors who also break out and adjust gross margins in a similar fashion . land sales during 2020 , the company recognized $ 0.2 million of deferred revenue for the remaining completed work on a land sale that initially occurred during 2019. during 2019 , the company sold three land parcels in northern california that generat ed $ 41.7 milli on in land sales revenue . in connection with the 2019 land sales , the company recorded a pretax lo ss from these sales of $ 3.4 mill ion , which included a $ 1.9 million impairment charge booked in the 2019 third quarter related to land that closed during the 2019 fourth quarter . the company sold lots as part of a strategic decision to generate cash flow and reduce our concentration of capital investments in certain markets . fee building replace_table_token_15_th for the year ended december 31 , 2020 , fee building revenues decreased 15 % from 2019 , driven by a decrease in construction activity at fee building communities in irvine , california . in august 2020 , irvine pacific , our largest customer , made a decision to begin building homes using their own general contractor 's license , effectively terminating our fee building arrangement with irvine pacific moving forward . although we are transitioning construction management responsibilities to irvine pacific and are not expected to be engaged for new fee building contracts with them going forward , we are currently in the process of finishing certain existing homes under construction and generating revenues in connection therewith , which we expect to continue through the first quarter of 2021. the company is actively seeking and entering into new fee building opportunities with other land developers with the objective of at least partially offsetting the expected reduction in irvine pacific business in future years , such as our new fee building relationship with fivepoint in irvine , california . included in fee building revenues for the years ended december 31 , 2020 and 2019 were ( i ) $ 78.7 million and $ 91.5 million of billings to land owners , respectively , and ( ii ) $ 2.3 million and $ 3.8 million of management fees from our unconsolidated joint ventures and third-party land owners , respectively . the cost of fee building decreased for the year ended december 31 , 2020 compared to 2019 primarily due to the decrease in fee building activity mentioned above and to a lesser extent , lower allocated general and administrative ( `` g & a `` ) expenses . the amount of g & a expenses included in the cost of fee building was $ 3.6 million and $ 5.4 million for the years ended december 31 , 2020 and 2019 , respectively . fee building gross margin decreased to $ 1.4 million for the year ended december 31 , 2020 from $ 2.1 million in the prior year period primarily due to lower fee billings and reduced management fees , which was partially offset by lower allocated g & a expenses . our fee building revenue has historically been concentrated with a small number of customers . for the years ended december 31 , 2020 , 2019 and 2018 , irvine pacific comprised 91 % , 95 % and 95 % of fee building revenue , respectively . 43 selling , general and administrative expenses replace_table_token_16_th during 2020 , our sg & a rate as a percentage

sangaree plaza and tri-county plaza on november 10 , 2016 , we completed our acquisition of sangaree plaza and tri-county plaza , a 66,948 and 67,577 square foot shopping center , respectively located in summerville , south carolina and royston , georgia , respectively ( `` sangaree/tri-county `` ) from a related party for a total contract price of $ 10.77 million . sangaree/tri-county was 95.2 % leased as of the acquisition date and are anchored by bi-lo grocery store . we acquired sangaree/tri-county from a related party through a combination of cash and the issuance of 122,250 common units in the operating partnership . riverbridge shopping center on november 15 , 2016 , the company completed its acquisition of riverbridge shopping center ( `` riverbridge `` ) , a 91,188 square foot shopping center located in carollton , georgia for a contract price of $ 7.00 million . riverbridge was 98.5 % leased as of the acquisition date and is anchored by ingles . the company acquired riverbridge through a combination of cash and debt . laburnum square on december 7 , 2016 , the company completed our acquisition of laburnum square , a 109,405 square foot shopping center located in richmond , virginia ( `` laburnum `` ) for a contract price of $ 10.50 million , paid through a combination of cash and debt . laburnum was 96.9 % leased as of the acquisition date and is anchored by kroger . 45 franklin village on december 12 , 2016 , the company completed our acquisition of franklin village , a 151,673 square foot shopping center located in kittanning , pennsylvania ( `` franklin `` ) for a contract price of $ 13.10 million , paid through a combination of cash and debt . franklin was 98.0 % leased as of the acquisition date and is anchored by shop ‘ n save . village at martinsville on december 16 , 2016 , the company completed our acquisition of village at martinsville , a 297,950 square foot shopping center located in martinsville , virginia ( `` martinsville `` ) for a contract price of $ 23.53 million , paid through a combination of cash and debt . martinsville was 97.0 % leased as of the acquisition date and is anchored by kroger . new market crossing on december 20 , 2016 , the company completed our acquisition of new market crossing , a 116,976 square foot shopping center located in mt . airy , north carolina ( `` new market `` ) for a contract price of $ 9.00 million , paid through a combination of cash and debt . new market was 93 % leased as of the acquisition date and is anchored by lowes food store . rivergate shopping center on december 21 , 2016 , the company completed our acquisition of rivergate shopping center , a 205,810 square foot shopping center located in macon , georgia ( `` rivergate `` ) for a contract price of $ 37.25 million , paid through a combination of cash and debt . rivergate was 96.0 % leased as of the acquisition date and is anchored by publix . note receivable on september 29 , 2016 , the company entered into an $ 11.00 million note receivable for the partial funding of the sea turtle development and an $ 1.00 million note receivable in consideration for the sale of 10.39 acres of land owned by the company . both promissory notes are collateralized by a 2 nd deed of trust on the property and accrue interest at a rate of 12 % annually . interest only payments at a rate of 8 % are due on the notes at the beginning of every calendar quarter starting october 2016. interest at a rate of 4 % accrues and is due at maturity . the notes mature the earlier of september 29 , 2021 disposition of the property . the balance on the notes receivable at december 31 , 2016 is $ 12.00 million . financing activities key bank credit agreement on may 29 , 2015 , the operating partnership entered into a $ 45.00 million million revolving credit line ( the `` credit agreement `` ) with keybank national association ( `` keybank `` ) . pursuant to the credit agreement , outstanding borrowings accrue monthly interest which is paid at a rate of the one-month london interbank offer rate ( `` libor `` ) plus a margin ranging from 1.75 % to 2.50 % depending on the company 's consolidated leverage ratio . on april 12 , 2016 , the operating partnership entered into a first amendment and joinder agreement ( “ first amendment ” ) to the credit agreement . the first amendment increased the $ 45.00 million revolving credit line with keybank to $ 67.20 million and the company utilized this additional borrowing capacity to acquire the a-c portfolio . pursuant to the terms of the first amendment , the monthly interest of the increased credit facility is adjusted to libor plus a margin of 5.00 % until such time that the company can meet certain repayment and leverage conditions . the company used series b proceeds to reduce its borrowings under the credit agreement to $ 46.10 million and the margin reduced back to the stated range of the original credit agreement on august 15 , 2016. on december 7 , 2016 , the operating partnership entered into a second amendment and joinder agreement ( `` second amendment `` ) to the credit agreement . the second amendment increased the line of credit to $ 75.0 million . pursuant to the terms of the second amendment , the pricing reverts back to the original credit agreement . the unutilized amounts available to the company under the credit agreement accrue fees which are paid at a rate of 0.30 % . story_separator_special_tag 51 our success in refinancing the debt and executing on our growth strategy will dictate our liquidity needs going forward . if we are unable to execute in these areas , our ability to grow and pay future dividends may be limited without additional capital . we believe significant opportunities exist in the current commercial real estate environment that will enable us to sufficiently leverage our capital and execute our growth plan . several factors are contributing to an increased supply in available properties for acquisition , including a significant level of maturities of cmbs debt , strategic shifts by larger reits to reduce debt levels and exit certain markets , and the negative impact on the real estate industry as a result of the economic downtown experienced in recent years . we believe the public reit model provides a unique growth vehicle whereby we can either acquire properties through traditional third party acquisitions using a combination of cash generated in the capital markets and debt financing ; contributions of properties by third parties in exchange for common units issued by the operating partnership ; and contributions of existing properties owned by mr. wheeler and his affiliates in exchange for common units issued by the operating partnership . additionally , access to public market capital enhances our ability to formulate acquisition structures and terms that better meet our growth strategies . in addition to liquidity required to fund debt payments , distributions and acquisitions , we may incur some level of capital expenditures during the year for our existing properties that can not be passed on to our tenants . the majority of these expenditures occur subsequent to acquiring a new property that requires significant improvements to maximize occupancy and lease rates , with an existing property that needs a facelift to improve its marketability or when tenant improvements are required to make a space fit a particular tenant 's needs . significant capital expenditures could also impact our ability to grow and pay future dividends . off-balance sheet arrangements as of december 31 , 2016 , we have no off-balance sheet arrangements that are likely to have a material effect on our financial condition , revenues or expenses , results of operations , liquidity , capital resources or capital expenditures . contractual obligations replace_table_token_21_th recent accounting pronouncements see note 2 to the consolidated financial statements beginning on page 82 of this annual report on form 10-k. 52 year ended december 31 , 2016 compared to the year ended december 31 , 2015 results of operations the following table presents a comparison of the consolidated statements of operations for the years ended december 31 , 2016 and 2015 , respectively . replace_table_token_22_th ( 1 ) excludes the undeveloped land parcels and riversedge north , our corporate headquarters , and the redevelopment property . includes assets held for sale . 53 same store and new store operating income the following table provides same store and new store financial information . same stores consist of those properties we owned during all periods presented in their entirety , while new stores consist of those properties during the periods presented . the discussion below focuses on same store results of operations since all twenty-three of our 2016 retail acquisitions occurred subsequent to december 31 , 2015. same store discontinued operations financial information reflects the activity of the following properties : harps at harbor point ( acquired december 14 , 2012 , sold in 2015 ) bixby commons ( acquired june 11 , 2013 , sold in 2015 ) jenks reasors ( acquired september 25 , 2013 , sold in 2015 ) starbucks/verizon ( acquired october 21 , 2013 , sold in 2015 ) new store discontinued operations financial information reflects the activity for the following properties : outback steakhouse and ruby tuesday ground leases at pierpont centre ( acquired january 14 , 2015 ) replace_table_token_23_th property revenues total same store property revenues for the year ended december 31 , 2016 were $ 19.20 million , compared to $ 19.04 million for the year ended december 31 , 2015 , representing an increase of $ 0.16 million , or 0.83 % . same store revenues fluctuated primarily due to positive rent spreads on renewals . 54 the year ended december 31 , 2016 represents a full period of operations reported for the fifteen retail acquisitions made in 2015 and partial periods of operations for the twenty-three retail acquisitions made in the year ended december 31 , 2016. these properties ( new stores ) contributed $ 22.90 million in revenues for the year ended december 31 , 2016 , compared to $ 7.62 million in revenue for the year ended december 31 , 2015. going forward we believe these properties will generate a significant amount of revenue for our company and we will benefit from future contractual rent increases . property expenses total same store property expenses for the year ended december 31 , 2016 were $ 5.77 million , compared to $ 6.09 million for the year ended december 31 , 2015. the decrease was primarily due to a decrease in parking lot repairs of $ 340 thousand , a decrease in management fees of $ 80 thousand , offset by a $ 104 thousand increase in real estate taxes due to property reassessments of prior acquisitions and an increase of $ 85 thousand in insurance expense . total property expenses increased primarily due to new store increases of $ 3.88 million . there were no significant unusual or non-recurring items included in new store property expenses for the year ended december 31 , 2016. property net operating income total property net operating income was $ 30.20 million for the year ended december 31 , 2016 , compared to $ 18.31 million for the year ended december 31 , 2015. the 2016 results represent an increase of $ 11.89 million over 2015 primarily due to the increases in property revenues discussed above . new stores

liquidity and capital resources at december 31 , 2016 , our consolidated cash and cash equivalents totaled $ 4.86 million compared to consolidated cash and cash equivalents of $ 10.48 million at december 31 , 2015 . cash flows from operating activities , investing activities and financing activities for the years ended december 31 , 2016 and 2015 are as follows : replace_table_token_19_th operating activities during the year ended december 31 , 2016 , our cash flows provided by operating activities were $ 10.44 million , compared to cash flows used in operating activities of $ 5.33 million during the year ended december 31 , 2015 . operating cash flows were primarily impacted by the $ 6.54 million decrease in our consolidated net loss due to the factors discussed in the `` results of operations '' section below , specifically the increase in ffo of $ 9.23 million from new stores that were acquired in 2015 and 2016. also impacting operating cash flows is the fluctuation in acquisition deposits included within deferred costs and the timing of the respective acquisitions accompanied by an increase in prepaid rents , primarily due to new stores . investing activities during the year ended december 31 , 2016 , our cash flows used in investing activities were $ 60.54 million , compared to cash flows used in investing activities of $ 54.86 million during the year ended december 31 , 2015. we acquired $ 186.33 million of assets in 2016 compared to $ 141 million in 2015. the a-c portfolio acquisition , consisting of fourteen retail property acquisitions ,was accomplished utilizing an 85 % loan to value ratio versus a typical ratio of 55 % to 65 % required on most commercial mortgage backed security ( `` cmbs '' ) loans .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```liquidity and capital resources at december 31 , 2016 , our consolidated cash and cash equivalents totaled $ 4.86 million compared to consolidated cash and cash equivalents of $ 10.48 million at december 31 , 2015 . cash flows from operating activities , investing activities and financing activities for the years ended december 31 , 2016 and 2015 are as follows : replace_table_token_19_th operating activities during the year ended december 31 , 2016 , our cash flows provided by operating activities were $ 10.44 million , compared to cash flows used in operating activities of $ 5.33 million during the year ended december 31 , 2015 . operating cash flows were primarily impacted by the $ 6.54 million decrease in our consolidated net loss due to the factors discussed in the `` results of operations '' section below , specifically the increase in ffo of $ 9.23 million from new stores that were acquired in 2015 and 2016. also impacting operating cash flows is the fluctuation in acquisition deposits included within deferred costs and the timing of the respective acquisitions accompanied by an increase in prepaid rents , primarily due to new stores . investing activities during the year ended december 31 , 2016 , our cash flows used in investing activities were $ 60.54 million , compared to cash flows used in investing activities of $ 54.86 million during the year ended december 31 , 2015. we acquired $ 186.33 million of assets in 2016 compared to $ 141 million in 2015. the a-c portfolio acquisition , consisting of fourteen retail property acquisitions ,was accomplished utilizing an 85 % loan to value ratio versus a typical ratio of 55 % to 65 % required on most commercial mortgage backed security ( `` cmbs '' ) loans . ``` Suspicious Activity Report : sangaree plaza and tri-county plaza on november 10 , 2016 , we completed our acquisition of sangaree plaza and tri-county plaza , a 66,948 and 67,577 square foot shopping center , respectively located in summerville , south carolina and royston , georgia , respectively ( `` sangaree/tri-county `` ) from a related party for a total contract price of $ 10.77 million . sangaree/tri-county was 95.2 % leased as of the acquisition date and are anchored by bi-lo grocery store . we acquired sangaree/tri-county from a related party through a combination of cash and the issuance of 122,250 common units in the operating partnership . riverbridge shopping center on november 15 , 2016 , the company completed its acquisition of riverbridge shopping center ( `` riverbridge `` ) , a 91,188 square foot shopping center located in carollton , georgia for a contract price of $ 7.00 million . riverbridge was 98.5 % leased as of the acquisition date and is anchored by ingles . the company acquired riverbridge through a combination of cash and debt . laburnum square on december 7 , 2016 , the company completed our acquisition of laburnum square , a 109,405 square foot shopping center located in richmond , virginia ( `` laburnum `` ) for a contract price of $ 10.50 million , paid through a combination of cash and debt . laburnum was 96.9 % leased as of the acquisition date and is anchored by kroger . 45 franklin village on december 12 , 2016 , the company completed our acquisition of franklin village , a 151,673 square foot shopping center located in kittanning , pennsylvania ( `` franklin `` ) for a contract price of $ 13.10 million , paid through a combination of cash and debt . franklin was 98.0 % leased as of the acquisition date and is anchored by shop ‘ n save . village at martinsville on december 16 , 2016 , the company completed our acquisition of village at martinsville , a 297,950 square foot shopping center located in martinsville , virginia ( `` martinsville `` ) for a contract price of $ 23.53 million , paid through a combination of cash and debt . martinsville was 97.0 % leased as of the acquisition date and is anchored by kroger . new market crossing on december 20 , 2016 , the company completed our acquisition of new market crossing , a 116,976 square foot shopping center located in mt . airy , north carolina ( `` new market `` ) for a contract price of $ 9.00 million , paid through a combination of cash and debt . new market was 93 % leased as of the acquisition date and is anchored by lowes food store . rivergate shopping center on december 21 , 2016 , the company completed our acquisition of rivergate shopping center , a 205,810 square foot shopping center located in macon , georgia ( `` rivergate `` ) for a contract price of $ 37.25 million , paid through a combination of cash and debt . rivergate was 96.0 % leased as of the acquisition date and is anchored by publix . note receivable on september 29 , 2016 , the company entered into an $ 11.00 million note receivable for the partial funding of the sea turtle development and an $ 1.00 million note receivable in consideration for the sale of 10.39 acres of land owned by the company . both promissory notes are collateralized by a 2 nd deed of trust on the property and accrue interest at a rate of 12 % annually . interest only payments at a rate of 8 % are due on the notes at the beginning of every calendar quarter starting october 2016. interest at a rate of 4 % accrues and is due at maturity . the notes mature the earlier of september 29 , 2021 disposition of the property . the balance on the notes receivable at december 31 , 2016 is $ 12.00 million . financing activities key bank credit agreement on may 29 , 2015 , the operating partnership entered into a $ 45.00 million million revolving credit line ( the `` credit agreement `` ) with keybank national association ( `` keybank `` ) . pursuant to the credit agreement , outstanding borrowings accrue monthly interest which is paid at a rate of the one-month london interbank offer rate ( `` libor `` ) plus a margin ranging from 1.75 % to 2.50 % depending on the company 's consolidated leverage ratio . on april 12 , 2016 , the operating partnership entered into a first amendment and joinder agreement ( “ first amendment ” ) to the credit agreement . the first amendment increased the $ 45.00 million revolving credit line with keybank to $ 67.20 million and the company utilized this additional borrowing capacity to acquire the a-c portfolio . pursuant to the terms of the first amendment , the monthly interest of the increased credit facility is adjusted to libor plus a margin of 5.00 % until such time that the company can meet certain repayment and leverage conditions . the company used series b proceeds to reduce its borrowings under the credit agreement to $ 46.10 million and the margin reduced back to the stated range of the original credit agreement on august 15 , 2016. on december 7 , 2016 , the operating partnership entered into a second amendment and joinder agreement ( `` second amendment `` ) to the credit agreement . the second amendment increased the line of credit to $ 75.0 million . pursuant to the terms of the second amendment , the pricing reverts back to the original credit agreement . the unutilized amounts available to the company under the credit agreement accrue fees which are paid at a rate of 0.30 % . story_separator_special_tag 51 our success in refinancing the debt and executing on our growth strategy will dictate our liquidity needs going forward . if we are unable to execute in these areas , our ability to grow and pay future dividends may be limited without additional capital . we believe significant opportunities exist in the current commercial real estate environment that will enable us to sufficiently leverage our capital and execute our growth plan . several factors are contributing to an increased supply in available properties for acquisition , including a significant level of maturities of cmbs debt , strategic shifts by larger reits to reduce debt levels and exit certain markets , and the negative impact on the real estate industry as a result of the economic downtown experienced in recent years . we believe the public reit model provides a unique growth vehicle whereby we can either acquire properties through traditional third party acquisitions using a combination of cash generated in the capital markets and debt financing ; contributions of properties by third parties in exchange for common units issued by the operating partnership ; and contributions of existing properties owned by mr. wheeler and his affiliates in exchange for common units issued by the operating partnership . additionally , access to public market capital enhances our ability to formulate acquisition structures and terms that better meet our growth strategies . in addition to liquidity required to fund debt payments , distributions and acquisitions , we may incur some level of capital expenditures during the year for our existing properties that can not be passed on to our tenants . the majority of these expenditures occur subsequent to acquiring a new property that requires significant improvements to maximize occupancy and lease rates , with an existing property that needs a facelift to improve its marketability or when tenant improvements are required to make a space fit a particular tenant 's needs . significant capital expenditures could also impact our ability to grow and pay future dividends . off-balance sheet arrangements as of december 31 , 2016 , we have no off-balance sheet arrangements that are likely to have a material effect on our financial condition , revenues or expenses , results of operations , liquidity , capital resources or capital expenditures . contractual obligations replace_table_token_21_th recent accounting pronouncements see note 2 to the consolidated financial statements beginning on page 82 of this annual report on form 10-k. 52 year ended december 31 , 2016 compared to the year ended december 31 , 2015 results of operations the following table presents a comparison of the consolidated statements of operations for the years ended december 31 , 2016 and 2015 , respectively . replace_table_token_22_th ( 1 ) excludes the undeveloped land parcels and riversedge north , our corporate headquarters , and the redevelopment property . includes assets held for sale . 53 same store and new store operating income the following table provides same store and new store financial information . same stores consist of those properties we owned during all periods presented in their entirety , while new stores consist of those properties during the periods presented . the discussion below focuses on same store results of operations since all twenty-three of our 2016 retail acquisitions occurred subsequent to december 31 , 2015. same store discontinued operations financial information reflects the activity of the following properties : harps at harbor point ( acquired december 14 , 2012 , sold in 2015 ) bixby commons ( acquired june 11 , 2013 , sold in 2015 ) jenks reasors ( acquired september 25 , 2013 , sold in 2015 ) starbucks/verizon ( acquired october 21 , 2013 , sold in 2015 ) new store discontinued operations financial information reflects the activity for the following properties : outback steakhouse and ruby tuesday ground leases at pierpont centre ( acquired january 14 , 2015 ) replace_table_token_23_th property revenues total same store property revenues for the year ended december 31 , 2016 were $ 19.20 million , compared to $ 19.04 million for the year ended december 31 , 2015 , representing an increase of $ 0.16 million , or 0.83 % . same store revenues fluctuated primarily due to positive rent spreads on renewals . 54 the year ended december 31 , 2016 represents a full period of operations reported for the fifteen retail acquisitions made in 2015 and partial periods of operations for the twenty-three retail acquisitions made in the year ended december 31 , 2016. these properties ( new stores ) contributed $ 22.90 million in revenues for the year ended december 31 , 2016 , compared to $ 7.62 million in revenue for the year ended december 31 , 2015. going forward we believe these properties will generate a significant amount of revenue for our company and we will benefit from future contractual rent increases . property expenses total same store property expenses for the year ended december 31 , 2016 were $ 5.77 million , compared to $ 6.09 million for the year ended december 31 , 2015. the decrease was primarily due to a decrease in parking lot repairs of $ 340 thousand , a decrease in management fees of $ 80 thousand , offset by a $ 104 thousand increase in real estate taxes due to property reassessments of prior acquisitions and an increase of $ 85 thousand in insurance expense . total property expenses increased primarily due to new store increases of $ 3.88 million . there were no significant unusual or non-recurring items included in new store property expenses for the year ended december 31 , 2016. property net operating income total property net operating income was $ 30.20 million for the year ended december 31 , 2016 , compared to $ 18.31 million for the year ended december 31 , 2015. the 2016 results represent an increase of $ 11.89 million over 2015 primarily due to the increases in property revenues discussed above . new stores

also in the fourth quarter of 2013 , we acquired five stations in three new markets ( together with the stations acquired in the excalibur acquisition , the “ 2013 acquired stations ” ) . unless the context of the discussion requires otherwise , we refer to the 2015 acquired stations , the 2014 acquired stations and the 2013 acquired stations collectively as the “ acquired stations . ” 36 in addition , on september 14 , 2015 , we announced that we agreed to acquire the assets of all of the television and radio stations of schurz for approximately $ 442.5 million inclusive of working capital . on october 1 , 2015 , we announced the sale of the assets of certain television stations to facilitate regulatory approvals for the schurz acquisition , and we simultaneously announced the acquisition of the assets of two television stations through swap transactions as part of those divestitures . on november 2 , 2015 , we announced that we had reached agreements with three radio broadcasters to divest the assets of schurz 's radio stations to those third-parties upon the closing of the schurz acquisition . on october 1 , 2015 , we also announced the acquisition of the assets of kyes-tv , which would be our second station in the anchorage , alaska television market . the kyes-tv acquisition , which remains pending , is excluded from the foregoing definition . on february 1 , 2016 , to facilitate regulatory approval of the schurz acquisition , we completed one swap transaction , the disposition of the assets of kake-tv in the wichita , kansas television market in exchange for the assets of wbxx-tv in the knoxville , tennessee television market . on february 16 , 2016 , we completed the remaining portions of the schurz acquisition and related transactions . the schurz acquisition and related transactions were funded by $ 425.0 million of borrowings under the 2016 term loan under our senior credit facility . proceeds from borrowings under the 2016 term loan were used to fund the cash purchase price and to pay a portion of the related fees and expenses . revenues , operations , cyclicality , seasonality and financing our operating revenues are derived primarily from broadcast and internet advertising and retransmission consent fees and , to a lesser extent , from other sources such as production of commercials , tower rentals and management fees . broadcast advertising is sold for placement either preceding or following a television station 's network programming and within local and syndicated programming . broadcast advertising is sold in time increments and is priced primarily on the basis of a program 's popularity among the specific audience an advertiser desires to reach , as measured by nielsen . in addition , broadcast advertising rates are affected by the number of advertisers competing for the available time , the size and demographic makeup of the market served by the station and the availability of alternative advertising media in the market area . broadcast advertising rates are generally the highest during the most desirable viewing hours , with corresponding reductions during other hours . the ratings of a local station affiliated with a major network can be affected by ratings of network programming . we also sell internet advertising on our stations ' websites . these advertisements may be sold as banner advertisements , pre-roll advertisements or video and other types of advertisements or sponsorships . 37 most advertising contracts are short-term , and generally run only for a few weeks . approximately 55 % of the net revenues of our television stations for the year ended december 31 , 2015 were generated from local advertising ( including political advertising revenues ) , which is sold primarily by a station 's sales staff directly to local accounts . approximately 14 % of the net revenues of our television stations for the year ended december 31 , 2015 were generated from national advertising , which is sold either by a station 's sales staff to national accounts or by a station 's national advertising sales representative to national accounts . the stations generally pay commissions to advertising agencies on local , regional and national advertising . the stations also pay commissions to the national sales representative on national advertising , including certain political advertising . broadcast advertising revenue is generally highest in the second and fourth quarters each year . this seasonality results partly from increases in advertising in the spring and in the period leading up to and including the holiday season . broadcast advertising revenue is also generally higher in even-numbered years , due to spending by political candidates , political parties and special interest groups during the “ on year ” of the two-year political advertising cycle . this political spending typically is heaviest during the fourth quarter of such years . our primary broadcasting operating expenses are employee compensation , related benefits and programming costs . in addition , the broadcasting operations incur overhead expenses , such as maintenance , supplies , insurance , rent and utilities . a large portion of the operating expenses of our broadcasting operations is fixed . our total revenue for 2015 increased from 2014. this was expected due primarily to the impact from our 2015 acquired stations and 2014 acquired stations . our retransmission consent revenue increased in 2015 compared to 2014 due to improved terms of our retransmission consent contracts , increased subscriber rates and the impact from our acquired stations . local and national advertising revenue in 2014 benefited from approximately $ 3.8 million earned from the broadcast of the 2014 winter olympic games on our then 14 nbc channels . story_separator_special_tag our average debt balance increased as a result of increased borrowings used to finance , in part , the acquisition of certain of the acquired stations . t he average interest rates on our total debt balances were 6.2 % and 6.0 % for 2014 and 2013 , respectively . story_separator_special_tag credit facility . during december 2014 , we made voluntary principal pre-payments totaling $ 67.0 million on the outstanding balance of the 2014 term loan under our senior credit facility ( the “ 2014 term loan ” ) and as a result we are not required to make any additional principal payments until the 2014 term loan matures on june 13 , 2021. retirement plans we sponsor and in some cases contribute to defined benefit and defined contribution retirement plans covering substantially all of our full-time employees . our defined benefit pension plans are the gray television , inc. retirement plan ( the “ gray pension plan ” ) as well as two plans assumed when we acquired the related businesses in prior years . effective july 1 , 2015 , monthly plan benefits under the gray pension plan were frozen and no longer increased after june 30 , 2015 , therefore all three of our defined benefit pension plans are frozen plans . our funding policy is consistent with the funding requirements of existing federal laws and regulations under the employee retirement income security act of 1974. a discount rate is selected annually to measure the present value of the benefit obligations . in determining the selection of a discount rate , we estimated the timing and amounts of expected future benefit payments and applied a yield curve developed to reflect yields available on high-quality bonds . the yield curve is based on an externally published index specifically designed to meet the criteria of united states generally accepted accounting principles ( “ u.s . gaap ” ) . the discount rate selected for determining benefit obligations as of december 31 , 2015 was 4.31 % , which reflects the results of this yield curve analysis . the discount rate used for determining benefit obligations as of december 31 , 2014 was 4.00 % . our assumptions regarding expected return on plan assets reflects asset allocations , the investment strategy and the views of investment managers , as well as historical experience . we use an assumed rate of return of 7.00 % for our assets invested in the gray pension plans . in 2015 , estimated asset returns for this plan , calculated on a mean market value assuming mid-year contributions and benefit payments , were a loss of 1.5 % , and in 2014 were a gain of 6.5 % . other significant assumptions relate to inflation , retirement and mortality rates . our inflation assumption is based on an evaluation of external market indicators . retirement and mortality rates are based on actual plan experience . during 2015 and 2014 , we contributed an aggregate of $ 5.4 million and $ 6.8 million , respectively , to our pension plans , and we anticipate making an aggregate contribution of approximately $ 2.3 million to such plans in 2016. the use of significantly different assumptions , or if actual experienced results differ significantly from those assumed , could result in our funding obligations being materially different . 47 see note 8 “ retirement plans ” of our audited consolidated financial statements included elsewhere herein for further information concerning the retirement plans . the gray television , inc. capital accumulation plan ( “ the capital accumulation plan ” ) is a defined contribution plan intended to meet the requirements of section 401 ( k ) of the internal revenue code . effective beginning on july 1 , 2015 , employer contributions under the capital accumulation plan include matching cash contributions at a rate of 100 % of the first 3 % of each employee 's salary deferral , and 50 % of the next 2 % of each employee 's salary deferral . in addition , the company , at its discretion , may make an additional profit sharing contribution , based on annual company performance , to those employees who meet certain criteria . during 2015 , we contributed an aggregate $ 1.8 million in employer matching contributions to the capital accumulation plan . in the year ended december 31 , 2015 we accrued , and in january 2016 we contributed , $ 1.6 million of profit sharing contributions to our capital accumulation plan . our contributions to our capital accumulation plan in 2014 were not significant . capital expenditures capital expenditures for the years ended december 31 , 2015 and 2014 were $ 24.2 million and $ 32.2 million , respectively . we expect that our capital expenditures will be approximately $ 40.0 million in the year ending december 31 , 2016. we expect to fund future capital expenditures with cash from operations . off-balance sheet arrangements operating commitments we have various operating lease commitments for equipment , land and office space . we also have commitments for various syndicated television programs . we have two types of syndicated television program contracts : first run programs and off network reruns . the first run programs are programs such as wheel of fortune and the off network programs are programs such as seinfeld . a difference between the two types of syndicated television programming is that the first run programs have not been produced at the time the contract to air such programming is signed but the off network programs have already been produced . for all syndicated television contracts , we record an asset and corresponding liability for payments to be made for the entire “ off network ” contract period and for only the current year of the “ first run ” contract period . only an estimate of the payments anticipated to be made in the year following the balance sheet date of the

loss from early extinguishment of debt in connection with entering into the senior credit facility , we incurred loan issuance costs of approximately $ 7.1 million , including bank fees and other professional fees . this amendment and restatement was determined to be a significant modification and , as a result , we recorded a related loss from early extinguishment of debt of $ 4.9 million in 2014. also , on december 15 , 2014 we exercised an option to acquire the assets of excalibur , which at that time was treated as a vie . in connection with this transaction , excalibur repaid the outstanding balance of their debt and as a result the unamortized portion of their deferred loan costs was written off as a loss from early extinguishment of debt of $ 0.2 million . income tax expense our effective income tax rate decreased to 39.8 % for 2014 from 41.8 % for 2013. our effective income tax rates differed from the statutory rate due to the following items : replace_table_token_9_th 44 liquidity and capital resources general the following tables present data that we believe is helpful in evaluating our liquidity and capital resources ( dollars in thousands ) : replace_table_token_10_th replace_table_token_11_th our senior credit facility consists of a revolving loan ( the “ revolving credit facility ” ) and a term loan . excluding accrued interest , the amount outstanding under our senior credit facility as of december 31 , 2015 and 2014 consisted solely of a term loan balance of $ 556.4 million . our maximum borrowing availability under our revolving credit facility is limited by our required compliance with certain restrictive covenants , including a first lien net leverage ratio covenant . as of december 31 , 2015 and 2014 , we had $ 675.0 million of our 2020 notes outstanding . as of of december 31 , 2015 and 2014 , the interest rate on the balance outstanding under the senior credit facility was 3.8 % , the coupon interest rate on our 2020 notes was 7.5 % and the yield was 7.3 % . as of december 31 , 2015 and 2014 , we had a deferred loan cost balance , net of accumulated amortization , of $ 6.1

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```loss from early extinguishment of debt in connection with entering into the senior credit facility , we incurred loan issuance costs of approximately $ 7.1 million , including bank fees and other professional fees . this amendment and restatement was determined to be a significant modification and , as a result , we recorded a related loss from early extinguishment of debt of $ 4.9 million in 2014. also , on december 15 , 2014 we exercised an option to acquire the assets of excalibur , which at that time was treated as a vie . in connection with this transaction , excalibur repaid the outstanding balance of their debt and as a result the unamortized portion of their deferred loan costs was written off as a loss from early extinguishment of debt of $ 0.2 million . income tax expense our effective income tax rate decreased to 39.8 % for 2014 from 41.8 % for 2013. our effective income tax rates differed from the statutory rate due to the following items : replace_table_token_9_th 44 liquidity and capital resources general the following tables present data that we believe is helpful in evaluating our liquidity and capital resources ( dollars in thousands ) : replace_table_token_10_th replace_table_token_11_th our senior credit facility consists of a revolving loan ( the “ revolving credit facility ” ) and a term loan . excluding accrued interest , the amount outstanding under our senior credit facility as of december 31 , 2015 and 2014 consisted solely of a term loan balance of $ 556.4 million . our maximum borrowing availability under our revolving credit facility is limited by our required compliance with certain restrictive covenants , including a first lien net leverage ratio covenant . as of december 31 , 2015 and 2014 , we had $ 675.0 million of our 2020 notes outstanding . as of of december 31 , 2015 and 2014 , the interest rate on the balance outstanding under the senior credit facility was 3.8 % , the coupon interest rate on our 2020 notes was 7.5 % and the yield was 7.3 % . as of december 31 , 2015 and 2014 , we had a deferred loan cost balance , net of accumulated amortization , of $ 6.1 ``` Suspicious Activity Report : also in the fourth quarter of 2013 , we acquired five stations in three new markets ( together with the stations acquired in the excalibur acquisition , the “ 2013 acquired stations ” ) . unless the context of the discussion requires otherwise , we refer to the 2015 acquired stations , the 2014 acquired stations and the 2013 acquired stations collectively as the “ acquired stations . ” 36 in addition , on september 14 , 2015 , we announced that we agreed to acquire the assets of all of the television and radio stations of schurz for approximately $ 442.5 million inclusive of working capital . on october 1 , 2015 , we announced the sale of the assets of certain television stations to facilitate regulatory approvals for the schurz acquisition , and we simultaneously announced the acquisition of the assets of two television stations through swap transactions as part of those divestitures . on november 2 , 2015 , we announced that we had reached agreements with three radio broadcasters to divest the assets of schurz 's radio stations to those third-parties upon the closing of the schurz acquisition . on october 1 , 2015 , we also announced the acquisition of the assets of kyes-tv , which would be our second station in the anchorage , alaska television market . the kyes-tv acquisition , which remains pending , is excluded from the foregoing definition . on february 1 , 2016 , to facilitate regulatory approval of the schurz acquisition , we completed one swap transaction , the disposition of the assets of kake-tv in the wichita , kansas television market in exchange for the assets of wbxx-tv in the knoxville , tennessee television market . on february 16 , 2016 , we completed the remaining portions of the schurz acquisition and related transactions . the schurz acquisition and related transactions were funded by $ 425.0 million of borrowings under the 2016 term loan under our senior credit facility . proceeds from borrowings under the 2016 term loan were used to fund the cash purchase price and to pay a portion of the related fees and expenses . revenues , operations , cyclicality , seasonality and financing our operating revenues are derived primarily from broadcast and internet advertising and retransmission consent fees and , to a lesser extent , from other sources such as production of commercials , tower rentals and management fees . broadcast advertising is sold for placement either preceding or following a television station 's network programming and within local and syndicated programming . broadcast advertising is sold in time increments and is priced primarily on the basis of a program 's popularity among the specific audience an advertiser desires to reach , as measured by nielsen . in addition , broadcast advertising rates are affected by the number of advertisers competing for the available time , the size and demographic makeup of the market served by the station and the availability of alternative advertising media in the market area . broadcast advertising rates are generally the highest during the most desirable viewing hours , with corresponding reductions during other hours . the ratings of a local station affiliated with a major network can be affected by ratings of network programming . we also sell internet advertising on our stations ' websites . these advertisements may be sold as banner advertisements , pre-roll advertisements or video and other types of advertisements or sponsorships . 37 most advertising contracts are short-term , and generally run only for a few weeks . approximately 55 % of the net revenues of our television stations for the year ended december 31 , 2015 were generated from local advertising ( including political advertising revenues ) , which is sold primarily by a station 's sales staff directly to local accounts . approximately 14 % of the net revenues of our television stations for the year ended december 31 , 2015 were generated from national advertising , which is sold either by a station 's sales staff to national accounts or by a station 's national advertising sales representative to national accounts . the stations generally pay commissions to advertising agencies on local , regional and national advertising . the stations also pay commissions to the national sales representative on national advertising , including certain political advertising . broadcast advertising revenue is generally highest in the second and fourth quarters each year . this seasonality results partly from increases in advertising in the spring and in the period leading up to and including the holiday season . broadcast advertising revenue is also generally higher in even-numbered years , due to spending by political candidates , political parties and special interest groups during the “ on year ” of the two-year political advertising cycle . this political spending typically is heaviest during the fourth quarter of such years . our primary broadcasting operating expenses are employee compensation , related benefits and programming costs . in addition , the broadcasting operations incur overhead expenses , such as maintenance , supplies , insurance , rent and utilities . a large portion of the operating expenses of our broadcasting operations is fixed . our total revenue for 2015 increased from 2014. this was expected due primarily to the impact from our 2015 acquired stations and 2014 acquired stations . our retransmission consent revenue increased in 2015 compared to 2014 due to improved terms of our retransmission consent contracts , increased subscriber rates and the impact from our acquired stations . local and national advertising revenue in 2014 benefited from approximately $ 3.8 million earned from the broadcast of the 2014 winter olympic games on our then 14 nbc channels . story_separator_special_tag our average debt balance increased as a result of increased borrowings used to finance , in part , the acquisition of certain of the acquired stations . t he average interest rates on our total debt balances were 6.2 % and 6.0 % for 2014 and 2013 , respectively . story_separator_special_tag credit facility . during december 2014 , we made voluntary principal pre-payments totaling $ 67.0 million on the outstanding balance of the 2014 term loan under our senior credit facility ( the “ 2014 term loan ” ) and as a result we are not required to make any additional principal payments until the 2014 term loan matures on june 13 , 2021. retirement plans we sponsor and in some cases contribute to defined benefit and defined contribution retirement plans covering substantially all of our full-time employees . our defined benefit pension plans are the gray television , inc. retirement plan ( the “ gray pension plan ” ) as well as two plans assumed when we acquired the related businesses in prior years . effective july 1 , 2015 , monthly plan benefits under the gray pension plan were frozen and no longer increased after june 30 , 2015 , therefore all three of our defined benefit pension plans are frozen plans . our funding policy is consistent with the funding requirements of existing federal laws and regulations under the employee retirement income security act of 1974. a discount rate is selected annually to measure the present value of the benefit obligations . in determining the selection of a discount rate , we estimated the timing and amounts of expected future benefit payments and applied a yield curve developed to reflect yields available on high-quality bonds . the yield curve is based on an externally published index specifically designed to meet the criteria of united states generally accepted accounting principles ( “ u.s . gaap ” ) . the discount rate selected for determining benefit obligations as of december 31 , 2015 was 4.31 % , which reflects the results of this yield curve analysis . the discount rate used for determining benefit obligations as of december 31 , 2014 was 4.00 % . our assumptions regarding expected return on plan assets reflects asset allocations , the investment strategy and the views of investment managers , as well as historical experience . we use an assumed rate of return of 7.00 % for our assets invested in the gray pension plans . in 2015 , estimated asset returns for this plan , calculated on a mean market value assuming mid-year contributions and benefit payments , were a loss of 1.5 % , and in 2014 were a gain of 6.5 % . other significant assumptions relate to inflation , retirement and mortality rates . our inflation assumption is based on an evaluation of external market indicators . retirement and mortality rates are based on actual plan experience . during 2015 and 2014 , we contributed an aggregate of $ 5.4 million and $ 6.8 million , respectively , to our pension plans , and we anticipate making an aggregate contribution of approximately $ 2.3 million to such plans in 2016. the use of significantly different assumptions , or if actual experienced results differ significantly from those assumed , could result in our funding obligations being materially different . 47 see note 8 “ retirement plans ” of our audited consolidated financial statements included elsewhere herein for further information concerning the retirement plans . the gray television , inc. capital accumulation plan ( “ the capital accumulation plan ” ) is a defined contribution plan intended to meet the requirements of section 401 ( k ) of the internal revenue code . effective beginning on july 1 , 2015 , employer contributions under the capital accumulation plan include matching cash contributions at a rate of 100 % of the first 3 % of each employee 's salary deferral , and 50 % of the next 2 % of each employee 's salary deferral . in addition , the company , at its discretion , may make an additional profit sharing contribution , based on annual company performance , to those employees who meet certain criteria . during 2015 , we contributed an aggregate $ 1.8 million in employer matching contributions to the capital accumulation plan . in the year ended december 31 , 2015 we accrued , and in january 2016 we contributed , $ 1.6 million of profit sharing contributions to our capital accumulation plan . our contributions to our capital accumulation plan in 2014 were not significant . capital expenditures capital expenditures for the years ended december 31 , 2015 and 2014 were $ 24.2 million and $ 32.2 million , respectively . we expect that our capital expenditures will be approximately $ 40.0 million in the year ending december 31 , 2016. we expect to fund future capital expenditures with cash from operations . off-balance sheet arrangements operating commitments we have various operating lease commitments for equipment , land and office space . we also have commitments for various syndicated television programs . we have two types of syndicated television program contracts : first run programs and off network reruns . the first run programs are programs such as wheel of fortune and the off network programs are programs such as seinfeld . a difference between the two types of syndicated television programming is that the first run programs have not been produced at the time the contract to air such programming is signed but the off network programs have already been produced . for all syndicated television contracts , we record an asset and corresponding liability for payments to be made for the entire “ off network ” contract period and for only the current year of the “ first run ” contract period . only an estimate of the payments anticipated to be made in the year following the balance sheet date of the

our fixed income product category is comprised of revenues related to the brokerage of cash and derivative fixed income products . fixed income volumes typically correlate with 62 fluctuations in interest rates , market volatility and the level of bond issuances . brokertec , a leading electronic trading platform in the fixed income market , reported increased average daily volumes ( `` adv `` ) of 8 % in 2013 vs. 2012. similarly , the securities industry and financial markets association ( `` sifma `` ) reported an increase in the adv of u.s. corporate debt of 8 % and an increase in corporate bond issuance of 1 % for the year ended december 31 , 2013 , as compared to the prior year . however , ice reported a 15 % decline in its credit default swap trade execution revenues compared with the prior year . despite some of these positive metrics , dealer banks and wholesale brokers generally reported declines in their fixed income revenues for 2013 , as compared to the prior year , which they attributed to difficult trading conditions . in comparison , our brokerage revenues from fixed income products declined 7 % in the year ended december 31 , 2013 , as compared to the prior year . interest rate and foreign exchange volumes . our financial product category largely consists of revenues related to the brokerage of foreign exchange and interest rate derivative products . foreign exchange volumes generally increased for the year ended december 31 , 2013 , compared to the same period in the prior year , primarily driven by volatility in the first half of the year from diverging u.s. and japanese monetary policy . it should be noted that market conditions were notably different in the latter half of the year with lower market volatility and regulatory uncertainty negatively impacting volumes . cme foreign exchange futures advs increased 5 % in 2013 , as compared to 2012 , while ebs , an electronic trading platform for spot currencies , reported a 6 % decrease in volumes year over year . reported volumes for interest rate products generally increased during the year ended december 31 , 2013 , as compared to 2012 , with cme reporting a 22 % increase in interest rate futures advs in 2013 , as compared to the prior year . our brokerage revenues from financial products increased 4 % in the year ended december 31 , 2013 , compared to the prior year . equity volumes . our equity product category consists of revenues related to the brokerage of cash equity and equity derivative products . equity derivative volumes in europe and the u.s. generally declined in 2013 , due to lower market volatility . international securities exchange 's equity derivative volumes declined 5 % , and eurex european equity derivative volumes decreased 6 % in 2013 as compared to the prior year . advs for nyse euronext 's u.s. cash products declined 11 % while its european cash products decreased 5 % , year over year . our brokerage revenues from equity products declined 14 % from the prior year . commodity volumes . our commodity product category consists of revenues related to the brokerage of a wide range of energy products , and to a lesser extent , other commodity products . we believe that overall energy notional volumes declined in the u.s. from a year ago due to regulatory , market and economic uncertainty . cme 's energy futures advs decreased 1 % in 2013 from the prior year , while ice 's energy futures volumes increased 1 % . in addition , the annual average rate per contract ( `` rpc `` ) declined approximately 13 % and 4 % for cme and ice , respectively , when compared to the prior year . we believe that the decline in rpc was due to product mix , the introduction of mini contracts which trade in a smaller notional value than standard energy contracts and volume/pricing incentives . our brokerage revenues from commodity products declined 13 % in 2013. clearing services volumes . our kyte subsidiary 's clearing operations are subject to many of the same drivers that influence otc market volumes . although market-wide trading volumes were generally lower in 2013 , kyte 's clearing revenues increased by 18 % , largely due to increased trading activity and the mix of products and exchanges utilized by existing clearing service customers . kyte 's clearing services revenues include the exchange fees that kyte charges to its clients but then passes on to the exchanges . 63 competitive and regulatory environment another major external market factor affecting our business and results of operations is competition , which may take the form of competitive pressure on the commissions we charge for our services or competition for qualified personnel with extensive experience in the specialized markets we serve . we currently compete for the services of skilled brokerage personnel with other wholesale market participants and , more broadly , we compete for the services of highly qualified technology development personnel . we believe that the demand for productive brokers has lessened in recent periods , as the wholesale brokerage industry has been impacted by lower trading volumes and sluggish trading conditions in certain markets we serve . however , we believe that there is increased competition to provide brokerage services to a smaller number of market participants in the near term as dealers continue to exit or reduce their proprietary trading operations . in addition , we believe that the continued regulatory uncertainty in certain markets has resulted in lower trading volumes and fewer participants in these markets . gfi swaps exchange llc , our sef platform , was temporarily registered as a sef by the cftc in september 2013 and many of the rules governing the operation of a multi-lateral trading platform for swaps in the u.s. became effective on october 2 , 2013. story_separator_special_tag year ended december 31 , 2012 compared to the year ended december 31 , 2011 net loss gfi 's net loss for the year ended december 31 , 2012 increased $ 6.8 million to $ 10.0 million from a net loss of $ 3.2 million for the year ended december 31 , 2011. total revenues decreased by $ 90.9 million , or 9.0 % , to $ 924.6 million in the year ended december 31 , 2012 from $ 1.02 billion in the prior year . the decrease in total revenues was primarily due to lower brokerage revenues , which decreased $ 101.1 million , or 12.7 % , partially offset by a net increase in `` other revenues , `` as described in more detail below . total interest and transaction-based expenses increased $ 2.8 million to $ 137.5 million in 2012. the increase resulted from higher transaction fees on clearing services at our kyte subsidiary primarily due to the mix of products and exchanges utilized by existing and new customers . total expenses , excluding interest and transaction-based expenses , decreased by $ 92.4 million , or 10.5 % , to $ 788.3 million for 2012 from $ 880.7 million for 2011. the decrease in total other expenses was largely attributable to a decrease in compensation and employee benefits expense , which resulted primarily from ( i ) lower performance bonus expense as a result of lower brokerage revenues and ( ii ) initiatives implemented during the latter part of 2011 and throughout 2012 to reduce our aggregate compensation expense . the decrease was also due to lower travel and promotion expenses and professional fees . 72 revenues the following table sets forth the changes in revenues for the year ended december 31 , 2012 , as compared to the same period in 2011 ( dollars in thousands , except percentage data ) : replace_table_token_9_th * denotes % of revenues , net of interest and transaction-based expenses * * denotes % change in 2012 as compared to 2011 brokerage revenues —we offer our brokerage services in four broad product categories : fixed income , equity , financial , and commodity . below is a discussion of our brokerage revenues by product category for the year ended december 31 , 2012. broker productivity ( defined as total brokerage revenues during the period divided by average monthly brokerage personnel headcount for the period ) across all product categories was $ 562 thousand for 2012 and decreased by approximately 13.1 % as compared to 2011. fixed income product brokerage revenues decreased $ 46.2 million , or 19.7 % , in 2012 compared to 2011. revenues from fixed income derivative and cash products decreased approximately 34.4 % and 5.9 % , respectively , as compared to the year ended december 31 , 2011. this decrease was partially due to lower trading volumes attributable , in part , to pending reform in the swaps market , as well as poor global economic conditions , continued low interest rates , market uncertainty and the ongoing sovereign debt issues in the eurozone . our average monthly brokerage personnel headcount for fixed income products decreased by 21 to 321 in 2012. equity product brokerage revenues decreased $ 39.0 million , or 22.3 % , in 2012 compared to 2011. the decrease was primarily attributable to reduced cash equity and equity derivative trading volumes in the u.s. and europe . this decrease was consistent with the decline in equity volumes reported in the broader exchange-traded cash and derivatives markets . our average monthly brokerage personnel headcount for equity products decreased by 27 to 217 in 2012. financial product brokerage revenues decreased $ 6.6 million , or 3.5 % , in 2012 compared to 2011. the decrease was primarily due to slow trading conditions in emerging markets in latin america and asia , partially offset by revenues from our new brokerage desks in france and switzerland , which commenced operations in october of 2011. our average monthly brokerage personnel headcount for financial products increased by 58 to 391 in 2012 . 73 commodity product brokerage revenues decreased $ 9.2 million , or 4.7 % , in 2012 compared to 2011. we believe that this decrease was largely attributable to regulatory uncertainty as it relates to the u.s. energy markets and the conversion of otc swaps to exchange-traded futures contracts in many north american energy products during the fourth quarter of 2012. partially offsetting this decrease was an increase in commodity brokerage revenues due to growth in certain energy and metals businesses and the addition of new desks in the u.s. and europe . our average monthly brokerage personnel headcount for commodity products decreased by 3 to 308 in 2012. clearing services revenue clearing services revenues increased by 4.7 % , or $ 5.3 million , in 2012 to $ 118.0 million due to a variation in the mix of products and exchanges utilized by our new and existing clearing service customers partially offset by a decrease in the number of trades cleared by our kyte subsidiary . clearing services revenues are related solely to the operations of kyte and consist of fees charged to our clearing service customers for clearing , settlement and other services . kyte also incurs exchange fees on behalf of its customers , which kyte then charges to its customers , and are therefore included in equal amounts in both revenues and expenses . other revenues other revenues were comprised of the following ( dollars in thousands ) : replace_table_token_10_th other revenues increased by $ 4.9 million to $ 111.0 million for the year ended december 31 , 2012 from $ 106.1 million for the year ended december 31 , 2011. this increase was largely related to an increase in our software , analytics and market data revenues of $ 10.5 million , which was primarily attributable to an increase in software revenues at our trayport subsidiary , due to expansion of their customer

cash and cash equivalents $ 174,606 $ 227,441 cash held at clearing organizations , net of customer cash 52,414 19,636 ​ ​ ​ ​ ​ ​ ​ ​ total balance sheet cash $ 227,020 $ 247,077 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ we believe that , based on current levels of operations , our cash from operations , together with our current cash holdings and available borrowings under our credit agreement with bank of america n.a . and certain other lenders ( the `` credit agreement '' ) , will be sufficient to fund our operations for at least the next twelve months . poor financial results , unanticipated expenses or unanticipated acquisitions or strategic investments could give rise to additional financing requirements sooner than we expect . there can be no assurance that equity or debt financing will be available when needed or , if available , that the financing will be on terms satisfactory to us and not dilutive to our then-current stockholders . sources and uses of cash the following table sets forth our cash flows from operating activities , investing activities and financing activities for the indicated periods . replace_table_token_18_th net cash provided by operating activities was $ 19.0 million for the year ended december 31 , 2013 compared with net cash provided by operating activities of $ 48.7 million for the year ended december 31 , 2012 , a net decrease in cash provided by operating activities of $ 29.7 million . the decrease in cash provided by operating activities was primarily due to a $ 26.7 increase in cash used for working capital in the year ended december 31 , 2013. such items include changes in ( i ) payables to clearing service customers , ( ii ) accounts receivable , ( iii ) accrued compensation and accounts payable , ( iv ) receivables from/payables to brokers , dealers , and clearing organizations , and ( v ) other assets and liabilities , largely attributable to deferred tax assets and interest payable .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```cash and cash equivalents $ 174,606 $ 227,441 cash held at clearing organizations , net of customer cash 52,414 19,636 ​ ​ ​ ​ ​ ​ ​ ​ total balance sheet cash $ 227,020 $ 247,077 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ we believe that , based on current levels of operations , our cash from operations , together with our current cash holdings and available borrowings under our credit agreement with bank of america n.a . and certain other lenders ( the `` credit agreement '' ) , will be sufficient to fund our operations for at least the next twelve months . poor financial results , unanticipated expenses or unanticipated acquisitions or strategic investments could give rise to additional financing requirements sooner than we expect . there can be no assurance that equity or debt financing will be available when needed or , if available , that the financing will be on terms satisfactory to us and not dilutive to our then-current stockholders . sources and uses of cash the following table sets forth our cash flows from operating activities , investing activities and financing activities for the indicated periods . replace_table_token_18_th net cash provided by operating activities was $ 19.0 million for the year ended december 31 , 2013 compared with net cash provided by operating activities of $ 48.7 million for the year ended december 31 , 2012 , a net decrease in cash provided by operating activities of $ 29.7 million . the decrease in cash provided by operating activities was primarily due to a $ 26.7 increase in cash used for working capital in the year ended december 31 , 2013. such items include changes in ( i ) payables to clearing service customers , ( ii ) accounts receivable , ( iii ) accrued compensation and accounts payable , ( iv ) receivables from/payables to brokers , dealers , and clearing organizations , and ( v ) other assets and liabilities , largely attributable to deferred tax assets and interest payable . ``` Suspicious Activity Report : our fixed income product category is comprised of revenues related to the brokerage of cash and derivative fixed income products . fixed income volumes typically correlate with 62 fluctuations in interest rates , market volatility and the level of bond issuances . brokertec , a leading electronic trading platform in the fixed income market , reported increased average daily volumes ( `` adv `` ) of 8 % in 2013 vs. 2012. similarly , the securities industry and financial markets association ( `` sifma `` ) reported an increase in the adv of u.s. corporate debt of 8 % and an increase in corporate bond issuance of 1 % for the year ended december 31 , 2013 , as compared to the prior year . however , ice reported a 15 % decline in its credit default swap trade execution revenues compared with the prior year . despite some of these positive metrics , dealer banks and wholesale brokers generally reported declines in their fixed income revenues for 2013 , as compared to the prior year , which they attributed to difficult trading conditions . in comparison , our brokerage revenues from fixed income products declined 7 % in the year ended december 31 , 2013 , as compared to the prior year . interest rate and foreign exchange volumes . our financial product category largely consists of revenues related to the brokerage of foreign exchange and interest rate derivative products . foreign exchange volumes generally increased for the year ended december 31 , 2013 , compared to the same period in the prior year , primarily driven by volatility in the first half of the year from diverging u.s. and japanese monetary policy . it should be noted that market conditions were notably different in the latter half of the year with lower market volatility and regulatory uncertainty negatively impacting volumes . cme foreign exchange futures advs increased 5 % in 2013 , as compared to 2012 , while ebs , an electronic trading platform for spot currencies , reported a 6 % decrease in volumes year over year . reported volumes for interest rate products generally increased during the year ended december 31 , 2013 , as compared to 2012 , with cme reporting a 22 % increase in interest rate futures advs in 2013 , as compared to the prior year . our brokerage revenues from financial products increased 4 % in the year ended december 31 , 2013 , compared to the prior year . equity volumes . our equity product category consists of revenues related to the brokerage of cash equity and equity derivative products . equity derivative volumes in europe and the u.s. generally declined in 2013 , due to lower market volatility . international securities exchange 's equity derivative volumes declined 5 % , and eurex european equity derivative volumes decreased 6 % in 2013 as compared to the prior year . advs for nyse euronext 's u.s. cash products declined 11 % while its european cash products decreased 5 % , year over year . our brokerage revenues from equity products declined 14 % from the prior year . commodity volumes . our commodity product category consists of revenues related to the brokerage of a wide range of energy products , and to a lesser extent , other commodity products . we believe that overall energy notional volumes declined in the u.s. from a year ago due to regulatory , market and economic uncertainty . cme 's energy futures advs decreased 1 % in 2013 from the prior year , while ice 's energy futures volumes increased 1 % . in addition , the annual average rate per contract ( `` rpc `` ) declined approximately 13 % and 4 % for cme and ice , respectively , when compared to the prior year . we believe that the decline in rpc was due to product mix , the introduction of mini contracts which trade in a smaller notional value than standard energy contracts and volume/pricing incentives . our brokerage revenues from commodity products declined 13 % in 2013. clearing services volumes . our kyte subsidiary 's clearing operations are subject to many of the same drivers that influence otc market volumes . although market-wide trading volumes were generally lower in 2013 , kyte 's clearing revenues increased by 18 % , largely due to increased trading activity and the mix of products and exchanges utilized by existing clearing service customers . kyte 's clearing services revenues include the exchange fees that kyte charges to its clients but then passes on to the exchanges . 63 competitive and regulatory environment another major external market factor affecting our business and results of operations is competition , which may take the form of competitive pressure on the commissions we charge for our services or competition for qualified personnel with extensive experience in the specialized markets we serve . we currently compete for the services of skilled brokerage personnel with other wholesale market participants and , more broadly , we compete for the services of highly qualified technology development personnel . we believe that the demand for productive brokers has lessened in recent periods , as the wholesale brokerage industry has been impacted by lower trading volumes and sluggish trading conditions in certain markets we serve . however , we believe that there is increased competition to provide brokerage services to a smaller number of market participants in the near term as dealers continue to exit or reduce their proprietary trading operations . in addition , we believe that the continued regulatory uncertainty in certain markets has resulted in lower trading volumes and fewer participants in these markets . gfi swaps exchange llc , our sef platform , was temporarily registered as a sef by the cftc in september 2013 and many of the rules governing the operation of a multi-lateral trading platform for swaps in the u.s. became effective on october 2 , 2013. story_separator_special_tag year ended december 31 , 2012 compared to the year ended december 31 , 2011 net loss gfi 's net loss for the year ended december 31 , 2012 increased $ 6.8 million to $ 10.0 million from a net loss of $ 3.2 million for the year ended december 31 , 2011. total revenues decreased by $ 90.9 million , or 9.0 % , to $ 924.6 million in the year ended december 31 , 2012 from $ 1.02 billion in the prior year . the decrease in total revenues was primarily due to lower brokerage revenues , which decreased $ 101.1 million , or 12.7 % , partially offset by a net increase in `` other revenues , `` as described in more detail below . total interest and transaction-based expenses increased $ 2.8 million to $ 137.5 million in 2012. the increase resulted from higher transaction fees on clearing services at our kyte subsidiary primarily due to the mix of products and exchanges utilized by existing and new customers . total expenses , excluding interest and transaction-based expenses , decreased by $ 92.4 million , or 10.5 % , to $ 788.3 million for 2012 from $ 880.7 million for 2011. the decrease in total other expenses was largely attributable to a decrease in compensation and employee benefits expense , which resulted primarily from ( i ) lower performance bonus expense as a result of lower brokerage revenues and ( ii ) initiatives implemented during the latter part of 2011 and throughout 2012 to reduce our aggregate compensation expense . the decrease was also due to lower travel and promotion expenses and professional fees . 72 revenues the following table sets forth the changes in revenues for the year ended december 31 , 2012 , as compared to the same period in 2011 ( dollars in thousands , except percentage data ) : replace_table_token_9_th * denotes % of revenues , net of interest and transaction-based expenses * * denotes % change in 2012 as compared to 2011 brokerage revenues —we offer our brokerage services in four broad product categories : fixed income , equity , financial , and commodity . below is a discussion of our brokerage revenues by product category for the year ended december 31 , 2012. broker productivity ( defined as total brokerage revenues during the period divided by average monthly brokerage personnel headcount for the period ) across all product categories was $ 562 thousand for 2012 and decreased by approximately 13.1 % as compared to 2011. fixed income product brokerage revenues decreased $ 46.2 million , or 19.7 % , in 2012 compared to 2011. revenues from fixed income derivative and cash products decreased approximately 34.4 % and 5.9 % , respectively , as compared to the year ended december 31 , 2011. this decrease was partially due to lower trading volumes attributable , in part , to pending reform in the swaps market , as well as poor global economic conditions , continued low interest rates , market uncertainty and the ongoing sovereign debt issues in the eurozone . our average monthly brokerage personnel headcount for fixed income products decreased by 21 to 321 in 2012. equity product brokerage revenues decreased $ 39.0 million , or 22.3 % , in 2012 compared to 2011. the decrease was primarily attributable to reduced cash equity and equity derivative trading volumes in the u.s. and europe . this decrease was consistent with the decline in equity volumes reported in the broader exchange-traded cash and derivatives markets . our average monthly brokerage personnel headcount for equity products decreased by 27 to 217 in 2012. financial product brokerage revenues decreased $ 6.6 million , or 3.5 % , in 2012 compared to 2011. the decrease was primarily due to slow trading conditions in emerging markets in latin america and asia , partially offset by revenues from our new brokerage desks in france and switzerland , which commenced operations in october of 2011. our average monthly brokerage personnel headcount for financial products increased by 58 to 391 in 2012 . 73 commodity product brokerage revenues decreased $ 9.2 million , or 4.7 % , in 2012 compared to 2011. we believe that this decrease was largely attributable to regulatory uncertainty as it relates to the u.s. energy markets and the conversion of otc swaps to exchange-traded futures contracts in many north american energy products during the fourth quarter of 2012. partially offsetting this decrease was an increase in commodity brokerage revenues due to growth in certain energy and metals businesses and the addition of new desks in the u.s. and europe . our average monthly brokerage personnel headcount for commodity products decreased by 3 to 308 in 2012. clearing services revenue clearing services revenues increased by 4.7 % , or $ 5.3 million , in 2012 to $ 118.0 million due to a variation in the mix of products and exchanges utilized by our new and existing clearing service customers partially offset by a decrease in the number of trades cleared by our kyte subsidiary . clearing services revenues are related solely to the operations of kyte and consist of fees charged to our clearing service customers for clearing , settlement and other services . kyte also incurs exchange fees on behalf of its customers , which kyte then charges to its customers , and are therefore included in equal amounts in both revenues and expenses . other revenues other revenues were comprised of the following ( dollars in thousands ) : replace_table_token_10_th other revenues increased by $ 4.9 million to $ 111.0 million for the year ended december 31 , 2012 from $ 106.1 million for the year ended december 31 , 2011. this increase was largely related to an increase in our software , analytics and market data revenues of $ 10.5 million , which was primarily attributable to an increase in software revenues at our trayport subsidiary , due to expansion of their customer

if this story_separator_special_tag safe harbor in addition to historical information , this annual report contains forward-looking statements within the meaning of section 27a of the securities act of 1933 and section 21e of the securities exchange act of 1934. actual results could differ materially from those projected in the forward-looking statements as a result of a number of factors , risks and uncertainties , including the risk factors set forth in item 1a . above and the risk factors set forth in this annual report . generally , the words “ anticipate ” , “ expect ” , “ intend ” , “ believe ” and similar expressions identify forward-looking statements . the forward-looking statements made in this annual report are made as of the filing date of this annual report with the sec , and future events or circumstances could cause results that differ significantly from the forward-looking statements included here . accordingly , we caution readers not to place undue reliance on these statements . we expressly disclaim any obligation to update or alter our forward-looking statements , whether , as a result of new information , future events or otherwise after the date of this document . 17 overview crexendo , inc. is a next-generation clec and an award-winning leader and provider of unified communications cloud telecom services , broadband internet services , and other cloud business services that are designed to provide enterprise-class cloud services to any size businesses at affordable monthly rates . the company has two operating segments , which consist of cloud telecommunications and web services . cloud telecommunications - our cloud telecommunications services transmit calls using ip or cloud technology , which converts voice signals into digital data packets for transmission over the internet or cloud . each of our calling plans provides a number of basic features typically offered by traditional telephone service providers , plus a wide range of enhanced features that we believe offer an attractive value proposition to our customers . this platform enables a user , via a single “ identity ” or telephone number , to access and utilize services and features regardless of how the user is connected to the internet or cloud , whether it 's from a desktop device or an application on a mobile device . we generate recurring revenue from our cloud telecommunications and broadband internet services . our cloud telecommunications contracts typically have a thirty-six to sixty month term . we generate product revenue and equipment financing revenue from the sale and lease of our cloud telecommunications equipment . revenues from the sale of equipment , including those from sales-type leases , are recognized at the time of sale or at the inception of the lease , as appropriate . our cloud telecommunications service revenue increased 27 % or $ 1,691,000 to $ 7,973,000 for the year ended december 31 , 2017 as compared to $ 6,282,000 for the year ended december 31 , 2016. our cloud telecommunications product revenue decreased 9 % or $ 128,000 to $ 1,347,000 for the year ended december 31 , 2017 as compared to $ 1,475,000 for the year ended december 31 , 2016. as of december 31 , 2017 and 2016 , our backlog was $ 19,871,000 and $ 15,921,000 , respectively . web services – we generate recurring revenue from website hosting and other professional services . our web services revenue decreased 22 % or $ 305,000 to $ 1,057,000 for the year ended december 31 , 2017 as compared to $ 1,362,000 for the year ended december 31 , 2016. results of consolidated operations the following discussion of financial condition and results of operations should be read in conjunction with the consolidated financial statements and notes thereto and other financial information included herein this annual report . results of consolidated operations ( in thousands , except for per share amounts ) replace_table_token_3_th year ended december 31 , 2017 compared to year ended december 31 , 2016 service revenue service revenue consists primarily of fees collected for cloud telecommunications services , professional services , interest from sales-type leases , broadband internet services , website hosting , and web management services . service revenue increased 18 % or $ 1,386,000 , to $ 9,030,000 for the year ended december 31 , 2017 as compared to $ 7,644,000 for the year ended december 31 , 2016. cloud telecommunications service revenue increased 27 % or $ 1,691,000 , to $ 7,973,000 for the year ended december 31 , 2017 as compared to $ 6,282,000 for the year ended december 31 , 2016. web service revenue decreased 22 % or $ 305,000 , to $ 1,057,000 for the year ended december 31 , 2017 as compared to $ 1,362,000 for the year ended december 31 , 2016 . 18 product revenue product revenue consists primarily of fees collected for the sale of desktop phone devices and third party equipment . product revenue decreased by 9 % or $ 128,000 , to $ 1,347,000 for the year ended december 31 , 2017 as compared to $ 1,475,000 for the year ended december 31 , 2016. product revenue fluctuates from one period to the next based on timing of installations . our typical customer installation is complete within 30 days . however , larger enterprise customers can take multiple months , depending on size and the number of locations . product revenue is recognized when products have been installed and services commence . we believe growth will initially be seen through increase in our backlog . story_separator_special_tag research and development expenses decreased 8 % or $ 67,000 , to $ 726,000 for the year ended december 31 , 2017 as compared to $ 793,000 for the year ended december 31 , 2016 due to fluctuations in salary and benefits . selling and marketing selling and marketing expenses consist primarily of direct sales representative salaries and benefits , partner channel commissions , the production of marketing materials and sales support software . selling and marketing expenses increased 16 % or $ 393,000 , to $ 2,924,000 for the year ended december 31 , 2017 as compared to $ 2,531,000 for the year ended december 31 , 2016. the increase in selling and marketing expense was due to an increase in salary and benefits of $ 328,000 resulting from hiring additional sales representatives to support our partner channel , and an increase in commission expenses of $ 311,000 directly related to overall increase in sales and revenue , offset by a decrease in sales support software costs of $ 125,000 , a decrease in business development costs of $ 87,000 , and a decrease in bad debt expense of $ 34,000 . 23 general and administrative general and administrative expenses consist of salaries and benefits for executives , administrative personnel , legal , rent , accounting , other professional services , and other administrative corporate expenses . general and administrative expenses decreased 13 % or $ 524,000 , to $ 3,661,000 for the year ended december 31 , 2017 as compared to $ 4,185,000 for the year ended december 31 , 2016. the decrease in general and administrative expenses is primarily due to a company-wide reduction in general and administrative expenses as we continue to cut unnecessary expenses . salary and benefits decreased $ 179,000 resulting from a decrease in headcount , software support decreased $ 153,000 resulting from utilizing more affordable software , delaware franchise fee tax decreased $ 61,000 due to reincorporating in nevada , computer equipment decreased $ 50,000 primarily due to a one-time charge in 2016 , corporate audit and tax fees decreased $ 44,000 due to reduced audit fees resulting from a change in auditors , depreciation and amortization expense decreased $ 30,000 due to certain intangible assets and fixed assets becoming fully amortized , and a decrease of $ 37,000 in it consulting fees , offset by a $ 30,000 increase in legal fees . consolidated general and administrative expenses decreased 17 % , or $ 829,000 to $ 4,071,000 for the year ended december 31 , 2017 compared to $ 4,900,000 for the year ended december 31 , 2016. other expense other expense primarily consists of interest expense , offset by sublease rental income . net other expense increased 408 % or $ 147,000 to $ 183,000 for the year ended december 31 , 2017 as compared to $ 36,000 for the year ended december 31 , 2016. we incurred interest expense on our related party note payable and a decrease in sublease income resulting from completion of our lease agreement obligation in the fourth quarter of 2016 and related sub-lease . operating results of our web services segment ( in thousands ) replace_table_token_9_th 24 quarterly financial information replace_table_token_10_th replace_table_token_11_th year ended december 31 , 2017 compared to year ended december 31 , 2016 service revenue service revenue from web services is generated primarily through website hosting , professional web management services , and extended payment term agreements ( eptas ) . web services revenue decreased 22 % or $ 305,000 , to $ 1,057,000 for the year ended december 31 , 2017 as compared to $ 1,362,000 for the year ended december 31 , 2016. the decrease in service revenue is primarily due to a decrease in hosting revenue of $ 208,000 , a $ 59,000 decrease in epta revenue due to decrease in outstanding receivables , and a decrease of $ 38,000 from a decline in web management professional services . cost of service revenue cost of service revenue consists primarily of bandwidth , customer service costs , and outsourcing fees related to fulfillment of our professional web management services . cost of service revenue decreased 42 % or $ 86,000 , to $ 117,000 for the year ended december 31 , 2017 as compared to $ 203,000 for the year ended december 31 , 2016. the cost of service revenue decrease is primarily related to cost savings from bringing customer support in house at the end of 2016. research and development research and development expenses primarily consist of salaries and benefits , and related expenses which are attributable to the development of our website development software products . research and development expenses decreased 27 % or $ 9,000 , to $ 24,000 for the year ended december 31 , 2017 as compared to $ 33,000 for the year ended december 31 , 2016. the decrease was primarily related to a reduction of salaries and benefits expenses . 25 general and administrative general and administrative expenses consist of salaries and benefits for executives , administrative personnel , legal , rent , accounting , other professional services , and other administrative corporate expenses . general and administrative expenses decreased 43 % or $ 305,000 , to $ 410,000 for the year ended december 31 , 2017 as compared to $ 715,000 for the year ended december 31 , 2016. the decrease in general and administrative expenses is primarily due to less of an allocation of corporate general and administrative expenses resulting from the 22 % decrease in service revenue for the year ended december 31 , 2017 compared to the year ended december 31 , 2016 , and a company-wide reduction in general and administrative expenses as we continue to cut unnecessary expenses . consolidated general and administrative expenses decreased 17 % , or $ 829,000 to $ 4,071,000 for the year ended december 31 , 2017 compared to $ 4,900,000 for the year ended december 31 , 2016. other income/

liquidity and capital resources as of december 31 , 2017 and 2016 , we had cash and cash equivalents of $ 1,282,000 and $ 619,000 , respectively . changes in cash and cash equivalents are dependent upon changes in , among other things , working capital items such as deferred revenues , accounts payable , accounts receivable , and various accrued expenses , as well as purchases of property and equipment and changes in our capital and financial structure due to debt repayments and issuances , stock option exercises , sales of equity investments and similar events . our operations for the third and fourth quarters of 2017 generated positive cash flows and we believe this trend will continue . we believe that our operations along with existing liquidity sources will satisfy our cash requirements for at least the next 12 months . if the assumptions underlying our business plan regarding future revenue and expenses change or if unexpected opportunities or needs arise , we may seek to raise additional cash by selling equity or debt securities . working capital working capital increased 739 % or $ 421,000 to $ 478,000 as of december 31 , 2017 as compared to $ 57,000 as of december 31 , 2016. the increase in working capital is primarily related to an increase in cash and cash equivalents of $ 663,000 , a decrease in accounts payable of $ 37,000 , a decrease in accrued expenses of $ 36,000 , an increase in trade receivables , net of allowance for doubtful accounts , of $

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```liquidity and capital resources as of december 31 , 2017 and 2016 , we had cash and cash equivalents of $ 1,282,000 and $ 619,000 , respectively . changes in cash and cash equivalents are dependent upon changes in , among other things , working capital items such as deferred revenues , accounts payable , accounts receivable , and various accrued expenses , as well as purchases of property and equipment and changes in our capital and financial structure due to debt repayments and issuances , stock option exercises , sales of equity investments and similar events . our operations for the third and fourth quarters of 2017 generated positive cash flows and we believe this trend will continue . we believe that our operations along with existing liquidity sources will satisfy our cash requirements for at least the next 12 months . if the assumptions underlying our business plan regarding future revenue and expenses change or if unexpected opportunities or needs arise , we may seek to raise additional cash by selling equity or debt securities . working capital working capital increased 739 % or $ 421,000 to $ 478,000 as of december 31 , 2017 as compared to $ 57,000 as of december 31 , 2016. the increase in working capital is primarily related to an increase in cash and cash equivalents of $ 663,000 , a decrease in accounts payable of $ 37,000 , a decrease in accrued expenses of $ 36,000 , an increase in trade receivables , net of allowance for doubtful accounts , of $ ``` Suspicious Activity Report : if this story_separator_special_tag safe harbor in addition to historical information , this annual report contains forward-looking statements within the meaning of section 27a of the securities act of 1933 and section 21e of the securities exchange act of 1934. actual results could differ materially from those projected in the forward-looking statements as a result of a number of factors , risks and uncertainties , including the risk factors set forth in item 1a . above and the risk factors set forth in this annual report . generally , the words “ anticipate ” , “ expect ” , “ intend ” , “ believe ” and similar expressions identify forward-looking statements . the forward-looking statements made in this annual report are made as of the filing date of this annual report with the sec , and future events or circumstances could cause results that differ significantly from the forward-looking statements included here . accordingly , we caution readers not to place undue reliance on these statements . we expressly disclaim any obligation to update or alter our forward-looking statements , whether , as a result of new information , future events or otherwise after the date of this document . 17 overview crexendo , inc. is a next-generation clec and an award-winning leader and provider of unified communications cloud telecom services , broadband internet services , and other cloud business services that are designed to provide enterprise-class cloud services to any size businesses at affordable monthly rates . the company has two operating segments , which consist of cloud telecommunications and web services . cloud telecommunications - our cloud telecommunications services transmit calls using ip or cloud technology , which converts voice signals into digital data packets for transmission over the internet or cloud . each of our calling plans provides a number of basic features typically offered by traditional telephone service providers , plus a wide range of enhanced features that we believe offer an attractive value proposition to our customers . this platform enables a user , via a single “ identity ” or telephone number , to access and utilize services and features regardless of how the user is connected to the internet or cloud , whether it 's from a desktop device or an application on a mobile device . we generate recurring revenue from our cloud telecommunications and broadband internet services . our cloud telecommunications contracts typically have a thirty-six to sixty month term . we generate product revenue and equipment financing revenue from the sale and lease of our cloud telecommunications equipment . revenues from the sale of equipment , including those from sales-type leases , are recognized at the time of sale or at the inception of the lease , as appropriate . our cloud telecommunications service revenue increased 27 % or $ 1,691,000 to $ 7,973,000 for the year ended december 31 , 2017 as compared to $ 6,282,000 for the year ended december 31 , 2016. our cloud telecommunications product revenue decreased 9 % or $ 128,000 to $ 1,347,000 for the year ended december 31 , 2017 as compared to $ 1,475,000 for the year ended december 31 , 2016. as of december 31 , 2017 and 2016 , our backlog was $ 19,871,000 and $ 15,921,000 , respectively . web services – we generate recurring revenue from website hosting and other professional services . our web services revenue decreased 22 % or $ 305,000 to $ 1,057,000 for the year ended december 31 , 2017 as compared to $ 1,362,000 for the year ended december 31 , 2016. results of consolidated operations the following discussion of financial condition and results of operations should be read in conjunction with the consolidated financial statements and notes thereto and other financial information included herein this annual report . results of consolidated operations ( in thousands , except for per share amounts ) replace_table_token_3_th year ended december 31 , 2017 compared to year ended december 31 , 2016 service revenue service revenue consists primarily of fees collected for cloud telecommunications services , professional services , interest from sales-type leases , broadband internet services , website hosting , and web management services . service revenue increased 18 % or $ 1,386,000 , to $ 9,030,000 for the year ended december 31 , 2017 as compared to $ 7,644,000 for the year ended december 31 , 2016. cloud telecommunications service revenue increased 27 % or $ 1,691,000 , to $ 7,973,000 for the year ended december 31 , 2017 as compared to $ 6,282,000 for the year ended december 31 , 2016. web service revenue decreased 22 % or $ 305,000 , to $ 1,057,000 for the year ended december 31 , 2017 as compared to $ 1,362,000 for the year ended december 31 , 2016 . 18 product revenue product revenue consists primarily of fees collected for the sale of desktop phone devices and third party equipment . product revenue decreased by 9 % or $ 128,000 , to $ 1,347,000 for the year ended december 31 , 2017 as compared to $ 1,475,000 for the year ended december 31 , 2016. product revenue fluctuates from one period to the next based on timing of installations . our typical customer installation is complete within 30 days . however , larger enterprise customers can take multiple months , depending on size and the number of locations . product revenue is recognized when products have been installed and services commence . we believe growth will initially be seen through increase in our backlog . story_separator_special_tag research and development expenses decreased 8 % or $ 67,000 , to $ 726,000 for the year ended december 31 , 2017 as compared to $ 793,000 for the year ended december 31 , 2016 due to fluctuations in salary and benefits . selling and marketing selling and marketing expenses consist primarily of direct sales representative salaries and benefits , partner channel commissions , the production of marketing materials and sales support software . selling and marketing expenses increased 16 % or $ 393,000 , to $ 2,924,000 for the year ended december 31 , 2017 as compared to $ 2,531,000 for the year ended december 31 , 2016. the increase in selling and marketing expense was due to an increase in salary and benefits of $ 328,000 resulting from hiring additional sales representatives to support our partner channel , and an increase in commission expenses of $ 311,000 directly related to overall increase in sales and revenue , offset by a decrease in sales support software costs of $ 125,000 , a decrease in business development costs of $ 87,000 , and a decrease in bad debt expense of $ 34,000 . 23 general and administrative general and administrative expenses consist of salaries and benefits for executives , administrative personnel , legal , rent , accounting , other professional services , and other administrative corporate expenses . general and administrative expenses decreased 13 % or $ 524,000 , to $ 3,661,000 for the year ended december 31 , 2017 as compared to $ 4,185,000 for the year ended december 31 , 2016. the decrease in general and administrative expenses is primarily due to a company-wide reduction in general and administrative expenses as we continue to cut unnecessary expenses . salary and benefits decreased $ 179,000 resulting from a decrease in headcount , software support decreased $ 153,000 resulting from utilizing more affordable software , delaware franchise fee tax decreased $ 61,000 due to reincorporating in nevada , computer equipment decreased $ 50,000 primarily due to a one-time charge in 2016 , corporate audit and tax fees decreased $ 44,000 due to reduced audit fees resulting from a change in auditors , depreciation and amortization expense decreased $ 30,000 due to certain intangible assets and fixed assets becoming fully amortized , and a decrease of $ 37,000 in it consulting fees , offset by a $ 30,000 increase in legal fees . consolidated general and administrative expenses decreased 17 % , or $ 829,000 to $ 4,071,000 for the year ended december 31 , 2017 compared to $ 4,900,000 for the year ended december 31 , 2016. other expense other expense primarily consists of interest expense , offset by sublease rental income . net other expense increased 408 % or $ 147,000 to $ 183,000 for the year ended december 31 , 2017 as compared to $ 36,000 for the year ended december 31 , 2016. we incurred interest expense on our related party note payable and a decrease in sublease income resulting from completion of our lease agreement obligation in the fourth quarter of 2016 and related sub-lease . operating results of our web services segment ( in thousands ) replace_table_token_9_th 24 quarterly financial information replace_table_token_10_th replace_table_token_11_th year ended december 31 , 2017 compared to year ended december 31 , 2016 service revenue service revenue from web services is generated primarily through website hosting , professional web management services , and extended payment term agreements ( eptas ) . web services revenue decreased 22 % or $ 305,000 , to $ 1,057,000 for the year ended december 31 , 2017 as compared to $ 1,362,000 for the year ended december 31 , 2016. the decrease in service revenue is primarily due to a decrease in hosting revenue of $ 208,000 , a $ 59,000 decrease in epta revenue due to decrease in outstanding receivables , and a decrease of $ 38,000 from a decline in web management professional services . cost of service revenue cost of service revenue consists primarily of bandwidth , customer service costs , and outsourcing fees related to fulfillment of our professional web management services . cost of service revenue decreased 42 % or $ 86,000 , to $ 117,000 for the year ended december 31 , 2017 as compared to $ 203,000 for the year ended december 31 , 2016. the cost of service revenue decrease is primarily related to cost savings from bringing customer support in house at the end of 2016. research and development research and development expenses primarily consist of salaries and benefits , and related expenses which are attributable to the development of our website development software products . research and development expenses decreased 27 % or $ 9,000 , to $ 24,000 for the year ended december 31 , 2017 as compared to $ 33,000 for the year ended december 31 , 2016. the decrease was primarily related to a reduction of salaries and benefits expenses . 25 general and administrative general and administrative expenses consist of salaries and benefits for executives , administrative personnel , legal , rent , accounting , other professional services , and other administrative corporate expenses . general and administrative expenses decreased 43 % or $ 305,000 , to $ 410,000 for the year ended december 31 , 2017 as compared to $ 715,000 for the year ended december 31 , 2016. the decrease in general and administrative expenses is primarily due to less of an allocation of corporate general and administrative expenses resulting from the 22 % decrease in service revenue for the year ended december 31 , 2017 compared to the year ended december 31 , 2016 , and a company-wide reduction in general and administrative expenses as we continue to cut unnecessary expenses . consolidated general and administrative expenses decreased 17 % , or $ 829,000 to $ 4,071,000 for the year ended december 31 , 2017 compared to $ 4,900,000 for the year ended december 31 , 2016. other income/

24 through its manitex , inc. subsidiary it markets a comprehensive line of boom trucks and sign cranes . manitex 's boom trucks and crane products are primarily used for industrial projects , energy exploration and infrastructure development , including , roads , bridges and commercial construction . its badger equipment company ( “badger” ) subsidiaryis a manufacturer of specialized rough terrain cranes and material handling products . badger primarily serves the needs of the construction , municipality , and railroad industries . the company 's manitex liftking ulc ( “manitex liftking” or “liftking” ) subsidiary sells a complete line of rough terrain forklifts , a line of stand-up electric forklifts , cushioned tired forklifts with lifting capacities from 18 thousand to 40 thousand pounds , and special mission oriented vehicles , as well as other specialized carriers , heavy material handling transporters and steel mill equipment . manitex liftking 's rough terrain forklifts are used in both commercial and military applications . specialty mission oriented vehicles and specialized carriers are designed and built to meet the company 's unique customer needs and requirements . the company 's specialized lifting equipment has met the particular needs of customers in various industries that include utility , ship building and steel mill industries . the company 's manitex load king , inc. ( “load king” ) subsidiary manufactures specialized custom trailers and hauling systems typically used for transporting heavy equipment . load king trailers serve niche markets in the commercial construction , railroad , military , and equipment rental industries through a dealer network . on july 1 , 2010 , the company 's newly formed italian subsidiary , cvs ferrari , srl , entered into an agreement to rent certain assets of cvs spa , on an exclusive rental basis , while cvs spa proceeds through the italian bankruptcy process ( concordato preventivo ) . cvs spa was located near milan , italy and designed and manufactured a range of reach stackers and associated lifting equipment for the global container handling market , which were sold through a broad dealer network . during the third quarter 2010 , cvs ferrari , srl commenced operations and employed the rental assets in its operations . on july 1 , 2011 , the company purchased the assets which were previously being rented . equipment distribution segment the company crane and machinery division is crane dealer that distributes terex rough terrain and truck cranes and manitex boom trucks and sky cranes . this business supplies repair parts for a wide variety of medium to heavy duty construction equipment sold both domestically and internationally . the crane products are used primarily for infrastructure development and commercial construction ; applications include road and bridge construction , general contracting , roofing , and sign construction and maintenance . in the second quarter of 2010 , we expanded our equipment distribution segment by creating a new division , north american equipment exchange ( “naee” ) to market previously-owned construction and heavy equipment , domestically and internationally . this division provides a wide range of used lifting and construction equipment of various ages and condition , and the company has the capability to refurbish the equipment to the customers ' specification economic conditions beginning in september of 2008 , the united states and world financial markets came under unprecedented stress . the immediate impact was a dramatic decrease in liquidity and credit availability throughout the world . an incredibly rapid and significant deterioration in economic conditions , especially in the united states and europe followed . these events had an immediate significant adverse impact on the company including order cancellations . the overall market for construction equipment has improved but has not returned to pre-2008 levels . certain market segments , particularly the north american energy sector , is currently very strong . as result , we have seen a significant increase in orders for our higher capacity boom trucks and specialized trailers . as of december 31 , 2012 , our backlog of $ 130 million represents increases of 56 % and 227 % respectively when december 31 , 2012 backlog is compared to december 31 , 2011 and december 31 , 2010 backlogs . as a result , we have taken actions to selectively increase production capacity , including hiring additional manufacturing employees at certain of our facilities . additionally , our suppliers have increased capacity to meet the increased demand . as a result , the 25 company 's production volumes and revenues have increased consistently during 2012 and our backlog has decreased from its peak of $ 150 million at june 30 , 2012 to a current backlog of $ 130 million . there , however , is still significant uncertainty , in part due to the european sovereign debt crisis and an uncertain outlook for the us economy and other global markets . nevertheless , the company expects continued revenue growth in 2013. factors affecting revenues and gross profit the company derives most of its revenue from purchase orders from dealers and distributors . the demand for the company 's products depends upon the general economic conditions of the markets in which the company competes . the company 's sales depend in part upon its customers ' replacement or repair cycles . adverse economic conditions , including a decrease in commodity prices , may cause customers to forego or postpone new purchases in favor of repairing existing machinery . additionally , our manitex liftking subsidiary revenues are impacted by the timing of orders received for military forklifts and residential housing starts . cvs revenues are impacted in part by the timing of contract awards related to major port projects . gross profit varies from period to period . factors that affect gross profit include product mix , production levels and cost of raw materials . story_separator_special_tag as such these operations had essentially no selling , general and administrative expenses for six months ended june 30 , 2010 and cvs had only had limited expenses for the three months ended september 30 , 2010 , as cvs was still in a start-up mode during the third quarter of 2010. the majority of the remaining 35 % increase is attributed to an increase in selling expense and higher compensation expense related to additional provisions for performance based compensation , a restoration of prior salary reductions and selected increase in staffing . selling expense increased primarily as the company spent $ 0.5 million to attend the 2011 con expo trade show . the con expo show , which is held every three years , was held in las vegas in march of this year . this show is an international gathering place for the construction industries . it is estimated that 120,000 professionals from around the world attended the show . increased revenues also contributed to the increase in selling expenses . other less significant factors , including higher travel expenses , also contributed to the increase in selling , general and administrative expense . legal settlement ( at net present value ) the company has disclosed in its previous filings with the security and exchange commission that its insurance carriers had denied coverage for two product liability suits . the insurance companies subsequently filed a declaratory judgment action in a u.s. district court , seeking a determination that there was no duty on the part of the liability insurance carriers to defend the company . the legal settlement ( at net present value ) was recorded as a result of the a fifth circuit appeals court ruling reversing the earlier district courts ruling in the company 's favor . the amount recorded , represents the net present value of twenty annual payments of ninety-five thousand dollars as provided for in an earlier contingent settlement for two product liability suits related to an accident that occurred in 2006. under the settlement agreement , the company only became liable when it was ultimately determined that there was no duty on the part of the liability insurance carriers to defend the company . this settlement is related to a liability for a product that was manufactured by a predecessor company of our manitex subsidiary . the product liability of this predecessor company was assumed by various acquiring companies and ultimately became the company 's liability when we acquired the company 's manitex subsidiary in 2006 . 30 this settlement is of an unusual nature and although it had a significant impact on our 2011 results , it is not related to on-going activities of the company . furthermore , the company is not aware of any other similar potential liabilities at the present time and has secured insurance coverage to explicitly cover such future instances , mitigating future business risks . operating income —the company , had operating income of $ 6.6 million and $ 5.5 million for the years ended december 31 , 2011 and 2010 , respectively . the increase in operating income is due to an increase in gross profit of $ 5.9 million offset by $ 4.8 million increase in operating expenses . an increase in revenues accounts for the increase in gross profit as the gross profit percent decreased 3.7 % between 2011 and 2010. the increase in operating expenses is primarily related to increases in selling , general and administrative expense and a charge booked to recognize a liability for a legal settlement . interest expense —interest expense was $ 2.5 million and $ 2.4 million for the years ended december 31 , 2011 and 2010 , respectively . decreases in interest rates charged on borrowing under the company 's revolving credit facilities were offset by an increase in outstanding debt . the increase in debt is principally related to increased borrowings under the company 's revolving credit lines and additional debt incurred in connection with the acquisition of cvs assets in july 2011. the additional borrowing against the company 's revolving credit facilities were incurred to support substantial revenue growth that occurred between 2010 and 2011. foreign currency transaction gains and loss —the company attempts to purchase forward currency exchange contracts such that the exchange gains and losses on the assets and liabilities denominated in other than the reporting units ' functional currency will be offset by the changes in the market value of the forward currency exchange contracts it holds . the company records at the balance sheet date the forward currency exchange contracts at their market value with any associated gain or loss being recorded in current earnings as a currency gain or loss . for the year ended december 31 , 2011 , the company had a foreign currency gain of $ 0.05 million as compared to a $ 0.06 million foreign currency loss for the year ended december 31 , 2010. the aforementioned foreign currency gains and losses are net of forward currency contracts gains and losses . income tax —income tax expense was $ 1.4 million and $ 1.0 million for the year ended december 31 , 2011 and 2010 , respectively . the increase in income tax is principally attributed to an increase in pre-tax income . net income —net income for the year ended december 31 , 2011 was $ 2.8 million . this compares with a net income for the year ended december 31 , 2010 of $ 2.1 million . segment information lifting equipment segment replace_table_token_7_th ( 1 ) cvs operating results are included since commencement of operations which occurred in the third quarter of 2010. year ended december 31 , 2012 compared to year ended december 31 , 2011 net revenues —net revenues increased $ 58.5 million to $ 188.8 million for the year ended december 31 , 2012 from $ 130.3 million for the comparable period in 2011. approximately seventy-five percent of the

liquidity and capital resources cash and cash equivalents were $ 1.9 million and $ 0.1 million at december 31 , 2012 and december 31 , 2011 , respectively . as of december 31 , 2012 , the company had approximately $ 7.8 million available to borrow under its credit facilities . the company needs cash to meet its working capital needs as the business grows , to acquire capital equipment , and to fund acquisitions and debt repayment . during 2012 , the company utilized all net operating carryforwards that were available . as consequence , going forward the company will be required to tax payments based on current earnings , which may be substantial . we intend to use cash flows from operations and existing availability under the current revolving credit facilities to fund anticipated levels of operations for approximately the next 12 months . as our availability under our credit lines is limited , it is important that we manage our working capital . we may need to raise additional capital through debt or equity financings to support our growth strategy , which may include additional acquisitions . there is no assurance that such financing will be available or , if available , on acceptable terms . stock offering on july 17 , 2012 , the company issued 500,000 shares of the company 's common stock , which was issued pursuant to a prospectus supplement and a prospectus , which is part of a registration statement on form s-3 that was declared effective by the securities and exchange commission on august 23 , 2011. the net proceeds for the stock offering of $ 3.8 million were to retire outstanding term debt . see note 21 in the consolidated financial statements for additional details . 34 outstanding borrowings and required payments the following is a summary of our outstanding borrowings at december 31 , 2012 replace_table_token_9_th the debt matures at various points in time . see note 13 to the financial statements for additional details .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```liquidity and capital resources cash and cash equivalents were $ 1.9 million and $ 0.1 million at december 31 , 2012 and december 31 , 2011 , respectively . as of december 31 , 2012 , the company had approximately $ 7.8 million available to borrow under its credit facilities . the company needs cash to meet its working capital needs as the business grows , to acquire capital equipment , and to fund acquisitions and debt repayment . during 2012 , the company utilized all net operating carryforwards that were available . as consequence , going forward the company will be required to tax payments based on current earnings , which may be substantial . we intend to use cash flows from operations and existing availability under the current revolving credit facilities to fund anticipated levels of operations for approximately the next 12 months . as our availability under our credit lines is limited , it is important that we manage our working capital . we may need to raise additional capital through debt or equity financings to support our growth strategy , which may include additional acquisitions . there is no assurance that such financing will be available or , if available , on acceptable terms . stock offering on july 17 , 2012 , the company issued 500,000 shares of the company 's common stock , which was issued pursuant to a prospectus supplement and a prospectus , which is part of a registration statement on form s-3 that was declared effective by the securities and exchange commission on august 23 , 2011. the net proceeds for the stock offering of $ 3.8 million were to retire outstanding term debt . see note 21 in the consolidated financial statements for additional details . 34 outstanding borrowings and required payments the following is a summary of our outstanding borrowings at december 31 , 2012 replace_table_token_9_th the debt matures at various points in time . see note 13 to the financial statements for additional details . ``` Suspicious Activity Report : 24 through its manitex , inc. subsidiary it markets a comprehensive line of boom trucks and sign cranes . manitex 's boom trucks and crane products are primarily used for industrial projects , energy exploration and infrastructure development , including , roads , bridges and commercial construction . its badger equipment company ( “badger” ) subsidiaryis a manufacturer of specialized rough terrain cranes and material handling products . badger primarily serves the needs of the construction , municipality , and railroad industries . the company 's manitex liftking ulc ( “manitex liftking” or “liftking” ) subsidiary sells a complete line of rough terrain forklifts , a line of stand-up electric forklifts , cushioned tired forklifts with lifting capacities from 18 thousand to 40 thousand pounds , and special mission oriented vehicles , as well as other specialized carriers , heavy material handling transporters and steel mill equipment . manitex liftking 's rough terrain forklifts are used in both commercial and military applications . specialty mission oriented vehicles and specialized carriers are designed and built to meet the company 's unique customer needs and requirements . the company 's specialized lifting equipment has met the particular needs of customers in various industries that include utility , ship building and steel mill industries . the company 's manitex load king , inc. ( “load king” ) subsidiary manufactures specialized custom trailers and hauling systems typically used for transporting heavy equipment . load king trailers serve niche markets in the commercial construction , railroad , military , and equipment rental industries through a dealer network . on july 1 , 2010 , the company 's newly formed italian subsidiary , cvs ferrari , srl , entered into an agreement to rent certain assets of cvs spa , on an exclusive rental basis , while cvs spa proceeds through the italian bankruptcy process ( concordato preventivo ) . cvs spa was located near milan , italy and designed and manufactured a range of reach stackers and associated lifting equipment for the global container handling market , which were sold through a broad dealer network . during the third quarter 2010 , cvs ferrari , srl commenced operations and employed the rental assets in its operations . on july 1 , 2011 , the company purchased the assets which were previously being rented . equipment distribution segment the company crane and machinery division is crane dealer that distributes terex rough terrain and truck cranes and manitex boom trucks and sky cranes . this business supplies repair parts for a wide variety of medium to heavy duty construction equipment sold both domestically and internationally . the crane products are used primarily for infrastructure development and commercial construction ; applications include road and bridge construction , general contracting , roofing , and sign construction and maintenance . in the second quarter of 2010 , we expanded our equipment distribution segment by creating a new division , north american equipment exchange ( “naee” ) to market previously-owned construction and heavy equipment , domestically and internationally . this division provides a wide range of used lifting and construction equipment of various ages and condition , and the company has the capability to refurbish the equipment to the customers ' specification economic conditions beginning in september of 2008 , the united states and world financial markets came under unprecedented stress . the immediate impact was a dramatic decrease in liquidity and credit availability throughout the world . an incredibly rapid and significant deterioration in economic conditions , especially in the united states and europe followed . these events had an immediate significant adverse impact on the company including order cancellations . the overall market for construction equipment has improved but has not returned to pre-2008 levels . certain market segments , particularly the north american energy sector , is currently very strong . as result , we have seen a significant increase in orders for our higher capacity boom trucks and specialized trailers . as of december 31 , 2012 , our backlog of $ 130 million represents increases of 56 % and 227 % respectively when december 31 , 2012 backlog is compared to december 31 , 2011 and december 31 , 2010 backlogs . as a result , we have taken actions to selectively increase production capacity , including hiring additional manufacturing employees at certain of our facilities . additionally , our suppliers have increased capacity to meet the increased demand . as a result , the 25 company 's production volumes and revenues have increased consistently during 2012 and our backlog has decreased from its peak of $ 150 million at june 30 , 2012 to a current backlog of $ 130 million . there , however , is still significant uncertainty , in part due to the european sovereign debt crisis and an uncertain outlook for the us economy and other global markets . nevertheless , the company expects continued revenue growth in 2013. factors affecting revenues and gross profit the company derives most of its revenue from purchase orders from dealers and distributors . the demand for the company 's products depends upon the general economic conditions of the markets in which the company competes . the company 's sales depend in part upon its customers ' replacement or repair cycles . adverse economic conditions , including a decrease in commodity prices , may cause customers to forego or postpone new purchases in favor of repairing existing machinery . additionally , our manitex liftking subsidiary revenues are impacted by the timing of orders received for military forklifts and residential housing starts . cvs revenues are impacted in part by the timing of contract awards related to major port projects . gross profit varies from period to period . factors that affect gross profit include product mix , production levels and cost of raw materials . story_separator_special_tag as such these operations had essentially no selling , general and administrative expenses for six months ended june 30 , 2010 and cvs had only had limited expenses for the three months ended september 30 , 2010 , as cvs was still in a start-up mode during the third quarter of 2010. the majority of the remaining 35 % increase is attributed to an increase in selling expense and higher compensation expense related to additional provisions for performance based compensation , a restoration of prior salary reductions and selected increase in staffing . selling expense increased primarily as the company spent $ 0.5 million to attend the 2011 con expo trade show . the con expo show , which is held every three years , was held in las vegas in march of this year . this show is an international gathering place for the construction industries . it is estimated that 120,000 professionals from around the world attended the show . increased revenues also contributed to the increase in selling expenses . other less significant factors , including higher travel expenses , also contributed to the increase in selling , general and administrative expense . legal settlement ( at net present value ) the company has disclosed in its previous filings with the security and exchange commission that its insurance carriers had denied coverage for two product liability suits . the insurance companies subsequently filed a declaratory judgment action in a u.s. district court , seeking a determination that there was no duty on the part of the liability insurance carriers to defend the company . the legal settlement ( at net present value ) was recorded as a result of the a fifth circuit appeals court ruling reversing the earlier district courts ruling in the company 's favor . the amount recorded , represents the net present value of twenty annual payments of ninety-five thousand dollars as provided for in an earlier contingent settlement for two product liability suits related to an accident that occurred in 2006. under the settlement agreement , the company only became liable when it was ultimately determined that there was no duty on the part of the liability insurance carriers to defend the company . this settlement is related to a liability for a product that was manufactured by a predecessor company of our manitex subsidiary . the product liability of this predecessor company was assumed by various acquiring companies and ultimately became the company 's liability when we acquired the company 's manitex subsidiary in 2006 . 30 this settlement is of an unusual nature and although it had a significant impact on our 2011 results , it is not related to on-going activities of the company . furthermore , the company is not aware of any other similar potential liabilities at the present time and has secured insurance coverage to explicitly cover such future instances , mitigating future business risks . operating income —the company , had operating income of $ 6.6 million and $ 5.5 million for the years ended december 31 , 2011 and 2010 , respectively . the increase in operating income is due to an increase in gross profit of $ 5.9 million offset by $ 4.8 million increase in operating expenses . an increase in revenues accounts for the increase in gross profit as the gross profit percent decreased 3.7 % between 2011 and 2010. the increase in operating expenses is primarily related to increases in selling , general and administrative expense and a charge booked to recognize a liability for a legal settlement . interest expense —interest expense was $ 2.5 million and $ 2.4 million for the years ended december 31 , 2011 and 2010 , respectively . decreases in interest rates charged on borrowing under the company 's revolving credit facilities were offset by an increase in outstanding debt . the increase in debt is principally related to increased borrowings under the company 's revolving credit lines and additional debt incurred in connection with the acquisition of cvs assets in july 2011. the additional borrowing against the company 's revolving credit facilities were incurred to support substantial revenue growth that occurred between 2010 and 2011. foreign currency transaction gains and loss —the company attempts to purchase forward currency exchange contracts such that the exchange gains and losses on the assets and liabilities denominated in other than the reporting units ' functional currency will be offset by the changes in the market value of the forward currency exchange contracts it holds . the company records at the balance sheet date the forward currency exchange contracts at their market value with any associated gain or loss being recorded in current earnings as a currency gain or loss . for the year ended december 31 , 2011 , the company had a foreign currency gain of $ 0.05 million as compared to a $ 0.06 million foreign currency loss for the year ended december 31 , 2010. the aforementioned foreign currency gains and losses are net of forward currency contracts gains and losses . income tax —income tax expense was $ 1.4 million and $ 1.0 million for the year ended december 31 , 2011 and 2010 , respectively . the increase in income tax is principally attributed to an increase in pre-tax income . net income —net income for the year ended december 31 , 2011 was $ 2.8 million . this compares with a net income for the year ended december 31 , 2010 of $ 2.1 million . segment information lifting equipment segment replace_table_token_7_th ( 1 ) cvs operating results are included since commencement of operations which occurred in the third quarter of 2010. year ended december 31 , 2012 compared to year ended december 31 , 2011 net revenues —net revenues increased $ 58.5 million to $ 188.8 million for the year ended december 31 , 2012 from $ 130.3 million for the comparable period in 2011. approximately seventy-five percent of the

our lead product candidate , immunopulse® il-12 , uses our electroporation device to deliver a dna-encoded interleukin-12 ( “ il-12 ” ) , called tavokinogene telseplasmid ( “ tavo ” ) , with the aim of reversing the immunosuppressive microenvironment in the treated tumor . the activation of the appropriate inflammatory response can drive a systemic anti-tumor response against untreated tumors in other parts of the body . in february 2017 , we received fast track designation from the u.s. food and drug administration ( “ fda ” ) for tavo in metastatic melanoma , which could qualify tavo for expedited fda review , a rolling biologics license application review and certain other benefits . we have ongoing development of tavo in both monotherapy and combination programs and intend to continue to pursue other ongoing or potential new trials and studies related to tavo , in various tumor types including melanoma , tnbc and head and neck cancers . in addition , we are also developing our next-generation electroporation device and applicator , and pursuing discovery research to identify other product candidates that , in addition to il-12 , can be encoded into propriety plasmid-dna , delivered intratumorally using electroporation . 61 results of operations for the year ended july 31 , 2018 compared to the year ended july 31 , 2017 the unaudited financial data for the year ended july 31 , 2018 and july 31 , 2017 is presented in the following table and the results of these two periods are included in the discussion thereafter . replace_table_token_1_th revenue we have not generated any revenue since our inception , and we do not anticipate generating meaningful , or any , revenue in the near term . research and development expenses our research and development expenses increased by $ 5.4 million , from $ 12.0 million in the year ended july 31 , 2017 to $ 17.4 million in the year ended july 31 , 2018. this increase was largely due to increases of : ( i ) $ 3.4 million in outside services costs related to the development of our next-generation electroporation device , clinical research organization costs , as well as clinical consulting costs to primarily support our pisces/keynote-695 study ; ( ii ) $ 2.3 million increase in plasmid manufacturing costs to support clinical trial supply readiness , and , ( iii ) $ 0.4 million in patient-related treatment costs ; these increases were net of ( iv ) $ 0.7 million in a research and development tax credit against our clinical trial costs incurred in australia . we expect research and development to continue to account for a significant portion of our total expenses in the future as we continue to develop our pipeline of product candidates and electroporation devices . [ note : the research and development tax credit relates to a tax credit from australian government based on research and development expenses incurred by our wholly-owned subsidiary in australia . the tax credit does not depend on the company 's generation of future taxable income or ongoing tax status or position . accordingly , the credit is not considered an element of income tax accounting under asc 740 . ] 62 general and administrative our general and administrative expenses increased by $ 9.0 million , from $ 9.7 million in the year ended july 31 , 2017 to $ 18.7 million in the year ended july 31 , 2018. this increase was largely due to increases of : ( i ) $ 4.1 million in stock-based compensation expense primarily related to option and rsu grants to our current directors and executives , as well as acceleration of the vesting of stock based compensation to previous executives ; ( ii ) $ 2.5 million in cash for services and non-cash stock options granted to third-party firms to provide certain investor relations and advisory consulting services ; ( iii ) $ 2.3 million in compensation costs , including severance expense for former executives ; and , ( iv ) $ 0.2 million in other general and administrative-related costs . other income ( expense ) , net other income ( expense ) , net , increased by $ 0.1 million , from other income net of $ 0.2 million in the year ended july 31 , 2017 to other income net of $ 0.3 million in the year ended july 31 , 2018. this increase was primarily due to interest-bearing cash and marketable securities investment accounts . loss on disposal of property and equipment loss on disposal of property and equipment increased by $ 0.9 million , from $ 0 in the year ended july 31 , 2017 to $ 0.9 million in the year ended july 31 , 2018. this increase was due to the loss on disposal of property and equipment related to our move to a smaller facility in san diego , california . warrant inducement expense the warrants issued in connection with our november 2017 warrant exercise inducement offering were considered inducement warrants and the fair value of the inducement warrants of $ 2.5 million is classified as equity and expensed as warrant inducement expense . ( see note 6 ) . provision for income taxes we recorded an income tax provision of $ 680 and $ 1,391 in the year ended july 31 , 2018 and 2017 , respectively , comprised solely of minimum state taxes because of a net tax loss in both periods . story_separator_special_tag stock to the investors that participated in our october 2017 offerings ( described below ) , in consideration for such investors ' agreement to waive certain covenants we made to such investors . story_separator_special_tag on october 9 , 2018 , the company received total proceeds , before expenses , of $ 8.0 million in cash from the offering and issued alpha holdings 5,333,333 shares of common stock . there were no underwriting or placement agent fees associated with the offering . the second closing of 4,666,667 shares of common stock is expected to occur on or before december 15 , 2018. critical accounting policies investment securities securities available for sale are recorded at fair value and unrealized gains and losses are reported , net of taxes , in accumulated other comprehensive income ( loss ) included in stockholders ' equity . securities held to maturity are recorded at amortized cost based on the company 's positive intent and ability to hold these securities to maturity . realized gains and losses from sales of securities available for sale are determined on a specific identification basis and are included in other revenue – net . management evaluates whether securities available for sale and securities held to maturity are other-than-temporarily impaired ( “ otti ” ) on a quarterly basis . debt securities with unrealized losses are considered otti if the company intends to sell the security or if it is more likely than not that the company will be required to sell such security prior to any anticipated recovery . if management determines that a security is otti under these circumstances , the impairment recognized in earnings is measured as the entire difference between the amortized cost and the then-current fair value . accounting for long-lived assets we assess the impairment of long-lived assets , consisting of property and equipment , periodically and whenever events or circumstances indicate that the carrying value may not be recoverable . examples of such circumstances may include : ( 1 ) the asset 's ability to continue to generate income from operations and positive cash flow in future periods ; ( 2 ) loss of legal ownership or title to an asset ; ( 3 ) significant changes in our strategic business objectives and utilization of the assets ; and ( 4 ) the impact of significant negative industry or economic trends . if a change were to occur in any of these or similar factors , the likelihood of a material change in our net loss would increase . 68 recoverability of assets to be held and used in operations is measured by a comparison of the carrying amount of an asset to the future net cash flows expected to be generated by the assets . although we believe the factors used by management to evaluate future net cash flows are reasonable , this evaluation requires a high degree of judgment , and results could vary if the actual amounts are materially different than management 's estimates . in addition , we base estimates of useful lives and related amortization or depreciation expense on our subjective estimate of the period the assets will generate revenue or otherwise be used by us . if long-lived assets are considered impaired , the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets . assets to be disposed of are reported at the lower of the carrying amount or fair value , less selling costs . equity-based awards the company grants equity-based awards ( typically stock options or restricted stock units ) under our stock-based compensation plan and outside of our stock-based compensation plan , with terms generally similar to the terms under our stock-based compensation plan . the company estimates the fair value of stock option awards using the black-scholes option valuation model . for employees and directors , the fair value of the award is measured on the grant date and for non-employees , the fair value of the award is generally re-measured on vesting dates and interim financial reporting dates until the service period is complete . the fair value amount is then recognized over the period during which services are required to be provided in exchange for the award , usually the vesting period . the black-scholes option valuation model requires the input of subjective assumptions , including price volatility of the underlying stock , risk-free interest rate , dividend yield , and expected life of the option . the company estimates the fair value of restricted stock unit awards based on the closing price of the company 's common stock on the date of issuance . changes in assumptions used under the black-scholes option valuation model could materially affect the company 's net loss and net loss per share . employee stock purchase plan employees may elect to participate in our stockholder approved employee stock purchase plan . the stock purchase plan allows for the purchase of our common stock at not less than 85 % of the lesser of ( i ) the fair market value of a share of stock on the beginning date of the offering period or ( ii ) the fair market value of a share of stock on the purchase date of the offering period , subject to a share and dollar limit as defined in the plan and subject to the applicable legal requirements . there are two 6-month offering periods during each fiscal year , ending on january 31 and july 31. in accordance with applicable accounting guidance , the fair value of awards under the stock purchase plan is calculated at the beginning of each offering period . we estimate the fair value of the awards using the black-scholes option valuation model . the black-scholes option valuation model requires the input of subjective assumptions , including price volatility of the underlying stock , risk-free interest rate , dividend yield , and the offering period . this fair value is then amortized at the beginning of the offering period . stock-based compensation expense is based on awards expected to be purchased at the beginning of

liquidity and capital resources working capital the following table and subsequent discussion summarize our working capital as of each of the periods presented : replace_table_token_2_th 63 current assets current assets as of july 31 , 2018 increased to $ 28.6 million , from $ 12.5 million as of july 31 , 2017. this increase was primarily due to an increase in cash , cash equivalents and short-term investment securities from $ 11.4 million as of july 31 , 2017 to $ 27.0 million as of july 31 , 2018 , which is attributable to the net proceeds received from our october 2017 offerings , november 2017 warrant exercise inducement offering and february 2018 offering ( see “ sources of capital ” below ) . current liabilities current liabilities as of july 31 , 2018 increased to $ 5.8 million , from $ 3.4 million as of july 31 , 2017. this increase was primarily due to an increase in accrued clinical and r & d related costs and an increase in accrued compensation . cash flow cash used in operating activities net cash used in operating activities for the year ended july 31 , 2018 was $ 23.2 million , as compared to $ 17.3 million for the year ended july 31 , 2017. the $ 5.9 million increase in cash used in operating activities was primarily attributable to an increase in cash used to support our operating activities , including but not limited to , our clinical trials , an increase in r & d activities and general working capital requirements . cash used in investing activities net cash used in investing activities for the year ended july 31 , 2018 was $ 23.3 million , as compared to $ 22,000 for the year ended july 31 , 2017. the increase was related to our movement of cash from a bank interest-earning account to two short-term investment accounts . we have an investment policy which is administered by management and reviewed by the board of directors . we believe our investment policy is conservative and maximizes returns , while minimizes risk , since we rely on the cash to fund operations .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```liquidity and capital resources working capital the following table and subsequent discussion summarize our working capital as of each of the periods presented : replace_table_token_2_th 63 current assets current assets as of july 31 , 2018 increased to $ 28.6 million , from $ 12.5 million as of july 31 , 2017. this increase was primarily due to an increase in cash , cash equivalents and short-term investment securities from $ 11.4 million as of july 31 , 2017 to $ 27.0 million as of july 31 , 2018 , which is attributable to the net proceeds received from our october 2017 offerings , november 2017 warrant exercise inducement offering and february 2018 offering ( see “ sources of capital ” below ) . current liabilities current liabilities as of july 31 , 2018 increased to $ 5.8 million , from $ 3.4 million as of july 31 , 2017. this increase was primarily due to an increase in accrued clinical and r & d related costs and an increase in accrued compensation . cash flow cash used in operating activities net cash used in operating activities for the year ended july 31 , 2018 was $ 23.2 million , as compared to $ 17.3 million for the year ended july 31 , 2017. the $ 5.9 million increase in cash used in operating activities was primarily attributable to an increase in cash used to support our operating activities , including but not limited to , our clinical trials , an increase in r & d activities and general working capital requirements . cash used in investing activities net cash used in investing activities for the year ended july 31 , 2018 was $ 23.3 million , as compared to $ 22,000 for the year ended july 31 , 2017. the increase was related to our movement of cash from a bank interest-earning account to two short-term investment accounts . we have an investment policy which is administered by management and reviewed by the board of directors . we believe our investment policy is conservative and maximizes returns , while minimizes risk , since we rely on the cash to fund operations . ``` Suspicious Activity Report : our lead product candidate , immunopulse® il-12 , uses our electroporation device to deliver a dna-encoded interleukin-12 ( “ il-12 ” ) , called tavokinogene telseplasmid ( “ tavo ” ) , with the aim of reversing the immunosuppressive microenvironment in the treated tumor . the activation of the appropriate inflammatory response can drive a systemic anti-tumor response against untreated tumors in other parts of the body . in february 2017 , we received fast track designation from the u.s. food and drug administration ( “ fda ” ) for tavo in metastatic melanoma , which could qualify tavo for expedited fda review , a rolling biologics license application review and certain other benefits . we have ongoing development of tavo in both monotherapy and combination programs and intend to continue to pursue other ongoing or potential new trials and studies related to tavo , in various tumor types including melanoma , tnbc and head and neck cancers . in addition , we are also developing our next-generation electroporation device and applicator , and pursuing discovery research to identify other product candidates that , in addition to il-12 , can be encoded into propriety plasmid-dna , delivered intratumorally using electroporation . 61 results of operations for the year ended july 31 , 2018 compared to the year ended july 31 , 2017 the unaudited financial data for the year ended july 31 , 2018 and july 31 , 2017 is presented in the following table and the results of these two periods are included in the discussion thereafter . replace_table_token_1_th revenue we have not generated any revenue since our inception , and we do not anticipate generating meaningful , or any , revenue in the near term . research and development expenses our research and development expenses increased by $ 5.4 million , from $ 12.0 million in the year ended july 31 , 2017 to $ 17.4 million in the year ended july 31 , 2018. this increase was largely due to increases of : ( i ) $ 3.4 million in outside services costs related to the development of our next-generation electroporation device , clinical research organization costs , as well as clinical consulting costs to primarily support our pisces/keynote-695 study ; ( ii ) $ 2.3 million increase in plasmid manufacturing costs to support clinical trial supply readiness , and , ( iii ) $ 0.4 million in patient-related treatment costs ; these increases were net of ( iv ) $ 0.7 million in a research and development tax credit against our clinical trial costs incurred in australia . we expect research and development to continue to account for a significant portion of our total expenses in the future as we continue to develop our pipeline of product candidates and electroporation devices . [ note : the research and development tax credit relates to a tax credit from australian government based on research and development expenses incurred by our wholly-owned subsidiary in australia . the tax credit does not depend on the company 's generation of future taxable income or ongoing tax status or position . accordingly , the credit is not considered an element of income tax accounting under asc 740 . ] 62 general and administrative our general and administrative expenses increased by $ 9.0 million , from $ 9.7 million in the year ended july 31 , 2017 to $ 18.7 million in the year ended july 31 , 2018. this increase was largely due to increases of : ( i ) $ 4.1 million in stock-based compensation expense primarily related to option and rsu grants to our current directors and executives , as well as acceleration of the vesting of stock based compensation to previous executives ; ( ii ) $ 2.5 million in cash for services and non-cash stock options granted to third-party firms to provide certain investor relations and advisory consulting services ; ( iii ) $ 2.3 million in compensation costs , including severance expense for former executives ; and , ( iv ) $ 0.2 million in other general and administrative-related costs . other income ( expense ) , net other income ( expense ) , net , increased by $ 0.1 million , from other income net of $ 0.2 million in the year ended july 31 , 2017 to other income net of $ 0.3 million in the year ended july 31 , 2018. this increase was primarily due to interest-bearing cash and marketable securities investment accounts . loss on disposal of property and equipment loss on disposal of property and equipment increased by $ 0.9 million , from $ 0 in the year ended july 31 , 2017 to $ 0.9 million in the year ended july 31 , 2018. this increase was due to the loss on disposal of property and equipment related to our move to a smaller facility in san diego , california . warrant inducement expense the warrants issued in connection with our november 2017 warrant exercise inducement offering were considered inducement warrants and the fair value of the inducement warrants of $ 2.5 million is classified as equity and expensed as warrant inducement expense . ( see note 6 ) . provision for income taxes we recorded an income tax provision of $ 680 and $ 1,391 in the year ended july 31 , 2018 and 2017 , respectively , comprised solely of minimum state taxes because of a net tax loss in both periods . story_separator_special_tag stock to the investors that participated in our october 2017 offerings ( described below ) , in consideration for such investors ' agreement to waive certain covenants we made to such investors . story_separator_special_tag on october 9 , 2018 , the company received total proceeds , before expenses , of $ 8.0 million in cash from the offering and issued alpha holdings 5,333,333 shares of common stock . there were no underwriting or placement agent fees associated with the offering . the second closing of 4,666,667 shares of common stock is expected to occur on or before december 15 , 2018. critical accounting policies investment securities securities available for sale are recorded at fair value and unrealized gains and losses are reported , net of taxes , in accumulated other comprehensive income ( loss ) included in stockholders ' equity . securities held to maturity are recorded at amortized cost based on the company 's positive intent and ability to hold these securities to maturity . realized gains and losses from sales of securities available for sale are determined on a specific identification basis and are included in other revenue – net . management evaluates whether securities available for sale and securities held to maturity are other-than-temporarily impaired ( “ otti ” ) on a quarterly basis . debt securities with unrealized losses are considered otti if the company intends to sell the security or if it is more likely than not that the company will be required to sell such security prior to any anticipated recovery . if management determines that a security is otti under these circumstances , the impairment recognized in earnings is measured as the entire difference between the amortized cost and the then-current fair value . accounting for long-lived assets we assess the impairment of long-lived assets , consisting of property and equipment , periodically and whenever events or circumstances indicate that the carrying value may not be recoverable . examples of such circumstances may include : ( 1 ) the asset 's ability to continue to generate income from operations and positive cash flow in future periods ; ( 2 ) loss of legal ownership or title to an asset ; ( 3 ) significant changes in our strategic business objectives and utilization of the assets ; and ( 4 ) the impact of significant negative industry or economic trends . if a change were to occur in any of these or similar factors , the likelihood of a material change in our net loss would increase . 68 recoverability of assets to be held and used in operations is measured by a comparison of the carrying amount of an asset to the future net cash flows expected to be generated by the assets . although we believe the factors used by management to evaluate future net cash flows are reasonable , this evaluation requires a high degree of judgment , and results could vary if the actual amounts are materially different than management 's estimates . in addition , we base estimates of useful lives and related amortization or depreciation expense on our subjective estimate of the period the assets will generate revenue or otherwise be used by us . if long-lived assets are considered impaired , the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets . assets to be disposed of are reported at the lower of the carrying amount or fair value , less selling costs . equity-based awards the company grants equity-based awards ( typically stock options or restricted stock units ) under our stock-based compensation plan and outside of our stock-based compensation plan , with terms generally similar to the terms under our stock-based compensation plan . the company estimates the fair value of stock option awards using the black-scholes option valuation model . for employees and directors , the fair value of the award is measured on the grant date and for non-employees , the fair value of the award is generally re-measured on vesting dates and interim financial reporting dates until the service period is complete . the fair value amount is then recognized over the period during which services are required to be provided in exchange for the award , usually the vesting period . the black-scholes option valuation model requires the input of subjective assumptions , including price volatility of the underlying stock , risk-free interest rate , dividend yield , and expected life of the option . the company estimates the fair value of restricted stock unit awards based on the closing price of the company 's common stock on the date of issuance . changes in assumptions used under the black-scholes option valuation model could materially affect the company 's net loss and net loss per share . employee stock purchase plan employees may elect to participate in our stockholder approved employee stock purchase plan . the stock purchase plan allows for the purchase of our common stock at not less than 85 % of the lesser of ( i ) the fair market value of a share of stock on the beginning date of the offering period or ( ii ) the fair market value of a share of stock on the purchase date of the offering period , subject to a share and dollar limit as defined in the plan and subject to the applicable legal requirements . there are two 6-month offering periods during each fiscal year , ending on january 31 and july 31. in accordance with applicable accounting guidance , the fair value of awards under the stock purchase plan is calculated at the beginning of each offering period . we estimate the fair value of the awards using the black-scholes option valuation model . the black-scholes option valuation model requires the input of subjective assumptions , including price volatility of the underlying stock , risk-free interest rate , dividend yield , and the offering period . this fair value is then amortized at the beginning of the offering period . stock-based compensation expense is based on awards expected to be purchased at the beginning of

we operate one of the largest streaming audio advertising networks in the united states , including owned and operated internet radio simulcast stations , and other third party digital audio companies with whom we have advertising reseller agreements . through cumulus digital c-suite , a comprehensive portfolio of digital marketing solutions , we sell digital advertising adjacent to , or embedded in , podcasts through our network of owned and third party podcasts . additionally , our digital commerce platform utilizes couponing and discounted daily deals to create promotional opportunities for local , regional and national clients under our sweet deals and incentrev brands . we also sell banner and other display ads across more than 400 local radio station websites , mobile applications , and ancillary custom client microsites . political advertising revenue . political advertising revenue is generated across all of our broadcast and digital assets , but we highlight it as a separate category to distinguish its highly cyclical nature versus core revenue . political advertising is generally strongest during even-numbered years , especially in the fourth quarter of such years , when most national and state elections are conducted . in addition to candidate advertising revenue , we also receive advertising revenue from special interest and advocacy groups . license fees & other . all other non-advertising based revenue types in which the company participates are aggregated in our license fees & other revenue category . this includes fees we receive for content licensing , third party network compensation , proprietary software licensing , subleases and rents ( predominantly for owned towers ) , and all other revenue . current bankruptcy proceedings ; liquidity and going concern considerations on november 29 , 2017 ( the `` petition date `` ) , the company and certain of its direct and indirect subsidiaries ( collectively , the “ debtors ” ) filed voluntary petitions for relief ( the “ bankruptcy petitions ” ) under chapter 11 of title 11 of the united states code ( the “ bankruptcy code ” ) in the united states bankruptcy court for the southern district of new york ( the “ bankruptcy court ” . the debtors ' chapter 11 cases are being jointly administered under the caption in re cumulus media inc. , et al , case no . 17-13381 . 37 index to financial statements immediately prior to the commencement of the case the debtors entered into a restructuring support agreement ( the “ restructuring support agreement ” ) with certain creditors ( the “ consenting creditors ” ) under that certain amended and restated credit agreement , dated as of december 23 , 2013 ( the “ credit agreement ” ) , by and among the company , cumulus media holdings inc. , as borrower , jpmorgan chase bank , n.a . , as administrative agent , and the lenders party thereto from time to time , and crestview radio investors , llc and certain of its affiliates ( the “ consenting equityholders ” ) . the restructuring support agreement contemplates the implementation of a financial restructuring of the debtors ( as described below ) through a conversion of more than $ 1.0 billion of the company 's funded debt into equity ( collectively , the “ restructuring ” ) . the restructuring will be effectuated by a joint plan of reorganization ( the “ plan ” ) under chapter 11 of the bankruptcy code if confirmed by the bankruptcy court . on december 1 , 2017 , the bankruptcy court approved certain motions and applications the debtors filed on the petition date ( the “ first day motions ” ) , certain of which were approved on an interim basis . on december 21 , 2017 , the bankruptcy court approved all of the company 's first day motions on a final basis . pursuant to the first day motions , and subject to certain terms and dollar limits included therein , the company was authorized to continue to use its unrestricted cash on hand , as well as all cash generated from daily operations , which is being used to continue the company 's operations without interruption during the course of its restructuring . also pursuant to the first day motions , the company received bankruptcy court authorization to , among other things and subject to the terms and conditions set forth in the applicable orders , pay certain pre-petition employee wages , salaries , health benefits and other employee obligations during its restructuring , pay certain claims relating to on-air talent and taxes , continue its cash management programs and insurance policies , as well as continue to honor its current customer programs . the company is authorized under the bankruptcy code to pay post-petition expenses incurred in the ordinary course of business without seeking bankruptcy court approval . until a plan of reorganization is approved and effective , the debtors will continue to manage their properties and operate their businesses as a “ debtor in possession ” under the jurisdiction of the bankruptcy court and in accordance with the applicable provisions of the bankruptcy code and the orders of the bankruptcy court . on december 9 , 2017 , the debtors filed the plan with the bankruptcy court and a related disclosure statement ( the `` disclosure statement `` ) pursuant to chapter 11 of the bankruptcy code . on january 18 , 2018 , the debtors filed with the bankruptcy court a first modified joint plan of reorganization and the related first modified disclosure statement for the plan pursuant to chapter 11 of the bankruptcy code . the plan and disclosure statement were further modified on january 31 , 2018 , february 2 , 2018 , february 12 , 2018 , and march 16 , 2018. on february 2 , 2018 , the bankruptcy court entered an order approving the disclosure statement and authorizing the solicitation of votes on the plan . story_separator_special_tag our sales of advertising time are primarily affected by the demand from local , regional and national advertisers , which also impacts the advertising rates we charge . advertising demand and rates are based primarily on the ability to attract audiences in the demographic groups targeted by such advertisers , as measured principally by various ratings agencies on a periodic basis . we endeavor to provide compelling programming and form connections between our on-air talent and listeners in order to develop strong listener loyalty , and we believe that the diversification of our formats and programs , including non-music formats and proprietary content , helps to insulate us from the effects of changes in the musical tastes of the public with respect to any particular format . we strive to maximize revenue by managing our on-air inventory of advertising time and adjusting prices based on supply and demand . the optimal number of advertisements available for sale depends on the programming format of a particular radio program . each program has a general target level of on-air inventory available for advertising . this target level of advertising inventory may vary at different times of the day but tends to remain stable over time . we seek to broaden our base of advertisers in each of our markets by providing a wide array of audience demographic segments across each cluster of stations , thereby providing potential advertisers with an effective means to reach a targeted demographic group . our advertising contracts are generally short-term . we generate most of our revenue from local and regional advertising , which is sold primarily by a station 's sales staff . in addition to local and regional advertising revenues , we monetize our available inventory in both national spot and network sales marketplaces using our national platform . to effectively deliver network advertising for our customers , we distribute content and programming through third party affiliates in order to reach a broader national audience . typically , in exchange for the right to broadcast radio network programming , third party affiliates remit a portion of their advertising time to us , which is then aggregated into packages focused on specific demographic groups and sold by us to our advertiser clients that want to reach those demographic groups on a national basis . in the broadcasting industry , we sometimes utilize trade or barter agreements that exchange advertising time for goods or services such as travel or lodging , instead of for cash . trade revenue totaled $ 40.1 million , $ 37.7 million and $ 39.2 million for the years ended december 31 , 2017 , 2016 and 2015 , respectively . we continually evaluate opportunities to increase revenues through new platforms , including technology-based initiatives . as a result of those revenue increasing opportunities through new platforms , our operating results in any period may be affected by the incurrence of advertising and promotion expenses that typically do not have an effect on revenue generation until future periods , if at all . in addition , as part of this evaluation we also from time to time reorganize and discontinue certain redundant and or unprofitable content vehicles across our platform which we expect will impact our broadcast revenues in the future . to date inflation has not had a material effect on our revenues or results of operations , although no assurances can be provided that material inflation in the future would not materially adversely affect us . 41 index to financial statements non-gaap financial measure consolidated adjusted earnings before interest , taxes , depreciation , and amortization ( `` adjusted ebitda `` ) and segment adjusted ebitda are the financial metrics by which management and the chief operating decision maker allocate resources of the company and analyze the performance of the company as a whole and each of our reportable segments , respectively . management also uses this measure to determine the contribution of our core operations to the funding of our corporate resources utilized to manage our operations and our non-operating expenses including debt service and acquisitions . in addition , consolidated adjusted ebitda , excluding the impact of local marketing agreement fees , is a key metric for purposes of calculating and determining our compliance with certain covenants contained in our credit agreement . the company excludes from adjusted ebitda items not related to core operations and those that are non-cash including : depreciation , amortization , stock-based compensation expense , gain or loss on the exchange or sale of any assets or stations , early extinguishment of debt , local marketing agreement fees , expenses relating to acquisitions , restructuring costs , reorganization items and non-cash impairments of assets . management believes that adjusted ebitda , although not a measure that is calculated in accordance with gaap , is commonly employed by the investment community as a measure for determining the market value of a media company and comparing the operational and financial performance among media companies . management has also observed that adjusted ebitda is routinely utilized to evaluate and negotiate the potential purchase price for media companies . given the relevance to our overall value , management believes that investors consider the metric to be extremely useful . adjusted ebitda should not be considered in isolation or as a substitute for net income ( loss ) , operating income , cash flows from operating activities or any other measure for determining the company 's operating performance or liquidity that is calculated in accordance with gaap . in addition , adjusted ebitda may be defined or calculated differently by other companies , and comparability may be limited . 42 index to financial statements consolidated results of operations analysis of consolidated statements of operations the following selected data from our audited consolidated statements of operations and other supplementary data should be referred to while reading the results of operations discussion that follows ( dollars in thousands ) : replace_table_token_14_th

liquidity and capital resources liquidity considerations the following table summarizes our significant non-operating cash payments made in the years ended december 31 , 2017 , 2016 and 2015 ( dollars in thousands ) : replace_table_token_28_th net cash provided by operating activities replace_table_token_29_th for the year ended december 31 , 2017 , net cash provided by operating activities increased by $ 50.9 million over the prior year . the increase was because of an increase in operating cash flows primarily as a result of changes in accounts payable and prepaid expenses and increases in net income and non cash reorganization charges , partially offset by a decrease in deferred income taxes . for the year ended december 31 , 2016 , net cash provided by operating activities decreased by $ 46.7 million over the prior year . the decrease was because of an increase primarily as a result of cash collections and payments of accounts payable and prepaid expenses , partially offset by decreases in net income and adjustments for depreciation and amortization of intangibles and debt issuance costs/discounts , gain ( loss ) on sale of assets or stations , impairment charges , deferred income taxes and stock-based compensation expense of $ 53.1 million , primarily the result of the non-cash gain on the august 2016 sale of certain assetsin our los angeles market .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```liquidity and capital resources liquidity considerations the following table summarizes our significant non-operating cash payments made in the years ended december 31 , 2017 , 2016 and 2015 ( dollars in thousands ) : replace_table_token_28_th net cash provided by operating activities replace_table_token_29_th for the year ended december 31 , 2017 , net cash provided by operating activities increased by $ 50.9 million over the prior year . the increase was because of an increase in operating cash flows primarily as a result of changes in accounts payable and prepaid expenses and increases in net income and non cash reorganization charges , partially offset by a decrease in deferred income taxes . for the year ended december 31 , 2016 , net cash provided by operating activities decreased by $ 46.7 million over the prior year . the decrease was because of an increase primarily as a result of cash collections and payments of accounts payable and prepaid expenses , partially offset by decreases in net income and adjustments for depreciation and amortization of intangibles and debt issuance costs/discounts , gain ( loss ) on sale of assets or stations , impairment charges , deferred income taxes and stock-based compensation expense of $ 53.1 million , primarily the result of the non-cash gain on the august 2016 sale of certain assetsin our los angeles market . ``` Suspicious Activity Report : we operate one of the largest streaming audio advertising networks in the united states , including owned and operated internet radio simulcast stations , and other third party digital audio companies with whom we have advertising reseller agreements . through cumulus digital c-suite , a comprehensive portfolio of digital marketing solutions , we sell digital advertising adjacent to , or embedded in , podcasts through our network of owned and third party podcasts . additionally , our digital commerce platform utilizes couponing and discounted daily deals to create promotional opportunities for local , regional and national clients under our sweet deals and incentrev brands . we also sell banner and other display ads across more than 400 local radio station websites , mobile applications , and ancillary custom client microsites . political advertising revenue . political advertising revenue is generated across all of our broadcast and digital assets , but we highlight it as a separate category to distinguish its highly cyclical nature versus core revenue . political advertising is generally strongest during even-numbered years , especially in the fourth quarter of such years , when most national and state elections are conducted . in addition to candidate advertising revenue , we also receive advertising revenue from special interest and advocacy groups . license fees & other . all other non-advertising based revenue types in which the company participates are aggregated in our license fees & other revenue category . this includes fees we receive for content licensing , third party network compensation , proprietary software licensing , subleases and rents ( predominantly for owned towers ) , and all other revenue . current bankruptcy proceedings ; liquidity and going concern considerations on november 29 , 2017 ( the `` petition date `` ) , the company and certain of its direct and indirect subsidiaries ( collectively , the “ debtors ” ) filed voluntary petitions for relief ( the “ bankruptcy petitions ” ) under chapter 11 of title 11 of the united states code ( the “ bankruptcy code ” ) in the united states bankruptcy court for the southern district of new york ( the “ bankruptcy court ” . the debtors ' chapter 11 cases are being jointly administered under the caption in re cumulus media inc. , et al , case no . 17-13381 . 37 index to financial statements immediately prior to the commencement of the case the debtors entered into a restructuring support agreement ( the “ restructuring support agreement ” ) with certain creditors ( the “ consenting creditors ” ) under that certain amended and restated credit agreement , dated as of december 23 , 2013 ( the “ credit agreement ” ) , by and among the company , cumulus media holdings inc. , as borrower , jpmorgan chase bank , n.a . , as administrative agent , and the lenders party thereto from time to time , and crestview radio investors , llc and certain of its affiliates ( the “ consenting equityholders ” ) . the restructuring support agreement contemplates the implementation of a financial restructuring of the debtors ( as described below ) through a conversion of more than $ 1.0 billion of the company 's funded debt into equity ( collectively , the “ restructuring ” ) . the restructuring will be effectuated by a joint plan of reorganization ( the “ plan ” ) under chapter 11 of the bankruptcy code if confirmed by the bankruptcy court . on december 1 , 2017 , the bankruptcy court approved certain motions and applications the debtors filed on the petition date ( the “ first day motions ” ) , certain of which were approved on an interim basis . on december 21 , 2017 , the bankruptcy court approved all of the company 's first day motions on a final basis . pursuant to the first day motions , and subject to certain terms and dollar limits included therein , the company was authorized to continue to use its unrestricted cash on hand , as well as all cash generated from daily operations , which is being used to continue the company 's operations without interruption during the course of its restructuring . also pursuant to the first day motions , the company received bankruptcy court authorization to , among other things and subject to the terms and conditions set forth in the applicable orders , pay certain pre-petition employee wages , salaries , health benefits and other employee obligations during its restructuring , pay certain claims relating to on-air talent and taxes , continue its cash management programs and insurance policies , as well as continue to honor its current customer programs . the company is authorized under the bankruptcy code to pay post-petition expenses incurred in the ordinary course of business without seeking bankruptcy court approval . until a plan of reorganization is approved and effective , the debtors will continue to manage their properties and operate their businesses as a “ debtor in possession ” under the jurisdiction of the bankruptcy court and in accordance with the applicable provisions of the bankruptcy code and the orders of the bankruptcy court . on december 9 , 2017 , the debtors filed the plan with the bankruptcy court and a related disclosure statement ( the `` disclosure statement `` ) pursuant to chapter 11 of the bankruptcy code . on january 18 , 2018 , the debtors filed with the bankruptcy court a first modified joint plan of reorganization and the related first modified disclosure statement for the plan pursuant to chapter 11 of the bankruptcy code . the plan and disclosure statement were further modified on january 31 , 2018 , february 2 , 2018 , february 12 , 2018 , and march 16 , 2018. on february 2 , 2018 , the bankruptcy court entered an order approving the disclosure statement and authorizing the solicitation of votes on the plan . story_separator_special_tag our sales of advertising time are primarily affected by the demand from local , regional and national advertisers , which also impacts the advertising rates we charge . advertising demand and rates are based primarily on the ability to attract audiences in the demographic groups targeted by such advertisers , as measured principally by various ratings agencies on a periodic basis . we endeavor to provide compelling programming and form connections between our on-air talent and listeners in order to develop strong listener loyalty , and we believe that the diversification of our formats and programs , including non-music formats and proprietary content , helps to insulate us from the effects of changes in the musical tastes of the public with respect to any particular format . we strive to maximize revenue by managing our on-air inventory of advertising time and adjusting prices based on supply and demand . the optimal number of advertisements available for sale depends on the programming format of a particular radio program . each program has a general target level of on-air inventory available for advertising . this target level of advertising inventory may vary at different times of the day but tends to remain stable over time . we seek to broaden our base of advertisers in each of our markets by providing a wide array of audience demographic segments across each cluster of stations , thereby providing potential advertisers with an effective means to reach a targeted demographic group . our advertising contracts are generally short-term . we generate most of our revenue from local and regional advertising , which is sold primarily by a station 's sales staff . in addition to local and regional advertising revenues , we monetize our available inventory in both national spot and network sales marketplaces using our national platform . to effectively deliver network advertising for our customers , we distribute content and programming through third party affiliates in order to reach a broader national audience . typically , in exchange for the right to broadcast radio network programming , third party affiliates remit a portion of their advertising time to us , which is then aggregated into packages focused on specific demographic groups and sold by us to our advertiser clients that want to reach those demographic groups on a national basis . in the broadcasting industry , we sometimes utilize trade or barter agreements that exchange advertising time for goods or services such as travel or lodging , instead of for cash . trade revenue totaled $ 40.1 million , $ 37.7 million and $ 39.2 million for the years ended december 31 , 2017 , 2016 and 2015 , respectively . we continually evaluate opportunities to increase revenues through new platforms , including technology-based initiatives . as a result of those revenue increasing opportunities through new platforms , our operating results in any period may be affected by the incurrence of advertising and promotion expenses that typically do not have an effect on revenue generation until future periods , if at all . in addition , as part of this evaluation we also from time to time reorganize and discontinue certain redundant and or unprofitable content vehicles across our platform which we expect will impact our broadcast revenues in the future . to date inflation has not had a material effect on our revenues or results of operations , although no assurances can be provided that material inflation in the future would not materially adversely affect us . 41 index to financial statements non-gaap financial measure consolidated adjusted earnings before interest , taxes , depreciation , and amortization ( `` adjusted ebitda `` ) and segment adjusted ebitda are the financial metrics by which management and the chief operating decision maker allocate resources of the company and analyze the performance of the company as a whole and each of our reportable segments , respectively . management also uses this measure to determine the contribution of our core operations to the funding of our corporate resources utilized to manage our operations and our non-operating expenses including debt service and acquisitions . in addition , consolidated adjusted ebitda , excluding the impact of local marketing agreement fees , is a key metric for purposes of calculating and determining our compliance with certain covenants contained in our credit agreement . the company excludes from adjusted ebitda items not related to core operations and those that are non-cash including : depreciation , amortization , stock-based compensation expense , gain or loss on the exchange or sale of any assets or stations , early extinguishment of debt , local marketing agreement fees , expenses relating to acquisitions , restructuring costs , reorganization items and non-cash impairments of assets . management believes that adjusted ebitda , although not a measure that is calculated in accordance with gaap , is commonly employed by the investment community as a measure for determining the market value of a media company and comparing the operational and financial performance among media companies . management has also observed that adjusted ebitda is routinely utilized to evaluate and negotiate the potential purchase price for media companies . given the relevance to our overall value , management believes that investors consider the metric to be extremely useful . adjusted ebitda should not be considered in isolation or as a substitute for net income ( loss ) , operating income , cash flows from operating activities or any other measure for determining the company 's operating performance or liquidity that is calculated in accordance with gaap . in addition , adjusted ebitda may be defined or calculated differently by other companies , and comparability may be limited . 42 index to financial statements consolidated results of operations analysis of consolidated statements of operations the following selected data from our audited consolidated statements of operations and other supplementary data should be referred to while reading the results of operations discussion that follows ( dollars in thousands ) : replace_table_token_14_th

we have determined that we operate as one reporting unit for evaluating goodwill . we have the option to qualitatively or quantitatively assess goodwill for impairment and , in 2013 , evaluated our goodwill using a quantitative assessment process . we test goodwill for impairment using the adjusted present value method ( “ apv ” ) to estimate the fair value of our reporting unit . under the apv method , future cash flows are based on recently prepared budget forecasts and business plans and are used to estimate the future economic benefits that the reporting unit will generate . an estimate of the appropriate discount rate is utilized to convert the future economic benefits to their present value equivalent . the quantitative goodwill impairment test is a two-step process . the first step identifies potential impairments by comparing the calculated fair value of a reporting unit with its book value . if the fair value of the reporting unit exceeds the carrying amount , goodwill is not impaired and the second step is not necessary . if the carrying value exceeds the fair value , the second step includes determining the implied fair value in the same manner as the amount of goodwill recognized in a business combination is determined . the implied fair value of goodwill is then compared with the carrying amount to determine if an impairment loss should be recorded . as of december 31 , 2013 , we had $ 49.5 million of goodwill on our balance sheet . the first step of our annual goodwill impairment analysis , which we perform as of october 1 of each year , did not result in an indication of impairment in 2013 , 2012 or 2011. the fair value of the reporting unit as of december 31 , 2013 , using the apv method , was 132 % greater than the carrying value at december 31 , 2013. we have determined the appropriate unit of accounting for testing franchise rights for impairment is on an individual store basis . we have the option to qualitatively or quantitatively assess indefinite-lived intangible assets for impairment . in 2013 , we evaluated our indefinite-lived intangible assets using a quantitative assessment process . we estimate the fair value of our franchise rights primarily using the multi-period excess earnings ( “ mpee ” ) model . the forecasted cash flows used in the mpee model contain inherent uncertainties , including significant estimates and assumptions related to growth rates , margins , general operating expenses , and cost of capital . we use primarily internally-developed forecasts and business plans to estimate the future cash flows that each franchise will generate . we have determined that only certain cash flows of the store are directly attributable to the franchise rights . we estimate the appropriate interest rate to discount future cash flows to their present value equivalent taking into consideration factors such as a risk-free rate , a peer group average beta , an equity risk premium and a small stock risk premium . we also may use a market approach to determine the fair value of our franchise rights . these market data points include our acquisition and divestiture experience and third-party broker estimates . as of december 31 , 2013 , we had $ 71.2 million of franchise value on our balance sheet associated with 57 stores . no individual store accounted for more than 12 % of our total franchise value as of december 31 , 2013. our impairment testing of franchise value did not indicate any impairment in 2013 , 2012 or 2011 . 32 we are subject to financial statement risk to the extent that our goodwill or franchise rights become impaired due to decreases in the fair value . a future decline in performance , decreases in projected growth rates or margin assumptions or changes in discount rates could result in a potential impairment , which could have a material adverse impact on our financial position and results of operations . furthermore , if a manufacturer becomes insolvent , we may be required to record a partial or total impairment on the franchise value related to that manufacturer . see notes 1 and 5 of notes to consolidated financial statements for additional information . long-lived assets we estimate the depreciable lives of our property and equipment , including leasehold improvements , and review each asset group for impairment when events or circumstances indicate that their carrying amounts may not be recoverable . we determined an asset group is comprised of the long-lived assets used in the operations of an individual store . we determine a triggering event has occurred by reviewing store forecasted and historical financial performance . an asset group is evaluated for recoverability if it has an operating loss in the current year and two of the prior three years . additionally , we may judgmentally evaluate an asset group if its financial performance indicates it may not support the carrying amount of the long-lived assets . if a store meets these criteria , we estimate the projected undiscounted cash flows for each asset group based on internally developed forecasts . if the undiscounted cash flows are lower than the carrying value of the asset group , we determine the fair value of the asset group based on additional market data , including recent experience in selling similar assets . we hold certain property for future development or investment purposes . if a triggering event is deemed to have occurred , we evaluate the property for impairment by comparing its estimated fair value based on listing price less costs to sell and other market data , including similar property that is for sale or has been recently sold , to the current carrying value . if the carrying value is more than the estimated fair value , an impairment is recorded . story_separator_special_tag selling , general and administrative expense ( “ sg & a ” ) sg & a includes salaries and related personnel expenses , advertising ( net of manufacturer cooperative advertising credits ) , rent , facility costs , and other general corporate expenses . replace_table_token_23_th replace_table_token_24_th 42 replace_table_token_25_th replace_table_token_26_th sg & a expense increased $ 53.7 million in 2013 compared to 2012. these increases were primarily driven by increased variable costs associated with improved sales and increases in advertising as we focused on gaining market share . additionally , in 2013 , we recorded a $ 6.2 million expense in other associated with a non-core legal reserve related to the settlement of a claim filed in 2006. this was offset by a $ 2.5 million non-core gain on the sale of property , which was recorded as a component of facility costs . in 2012 , sg & a expense increased $ 57.0 million as variable costs increased associated with sales growth . these increases in cost were offset by a continued focus on maintaining fixed costs . additionally , we recorded a non-core gain of $ 6.9 million on the sale of property as a component of facility costs in 2011. sg & a as a percentage of gross profit was 67.7 % in 2013 compared to 69.3 % in 2012 and 71.1 % in 2011. excluding the non-core legal reserve and gain on the sale of property in 2013 and the gain on the sale of property in 2011 , sg & a expense as a percentage of gross profit was 67.2 % in 2013 compared to 69.4 % in 2012 and 72.5 % in 2011. see “ non-gaap reconciliations ” in management 's discussion and analysis of financial condition and results of operations for more details . as sales volume increases and we further leverage our cost structure , we anticipate maintaining sg & a as a percentage of gross profit in the upper 60 % range in 2014. we also measure the leverage of our cost structure by evaluating throughput , which is the incremental percentage of gross profit retained after deducting sg & a expense . replace_table_token_27_th replace_table_token_28_th throughput contributions for newly opened or acquired stores reduce overall throughput as in the first year of operation , a store 's throughput is equal to the inverse of their sg & a as a percentage of gross profit . for example , a store which achieves sg & a as a percentage of gross profit of 70 % will have throughput of 30 % in the first year of operation . 43 we acquired six stores and opened one new store in 2013 and acquired four stores and opened two new stores in 2012. adjusting for these locations and the non-core adjustments discussed above , our throughput contribution on a same store basis was 51.4 % for the year ended december 31 , 2013 compared to 2012. our throughput contribution on a same store basis for 2012 compared to 2011 was 51.2 % . we continue to target a same store throughput contribution of approximately 50 % . depreciation and amortization depreciation and amortization is comprised of depreciation expense related to buildings , significant remodels or improvements , furniture , tools , equipment and signage and amortization of certain intangible assets , including customer lists and non-compete agreements . year ended december 31 , % ( dollars in thousands ) 2013 2012 increase increase depreciation and amortization $ 20,035 $ 17,128 $ 2,907 17.0 % year ended december 31 , % ( dollars in thousands ) 2012 2011 increase increase depreciation and amortization $ 17,128 $ 16,427 $ 701 4.3 % depreciation and amortization increased $ 2.9 million in 2013 compared to 2012 , and $ 0.7 million in 2012 compared to 2011 , as we purchased previously leased facilities , built new facilities subsequent to the acquisition of stores and invested in improvements at our facilities and replacement of equipment . these investments increase the amount of depreciable assets and amortizable expenses . operating income operating income was 4.6 % , 4.5 % and 4.2 % of revenue , respectively , in 2013 , 2012 and 2011. the increases in 2013 compared to 2012 , and 2012 compared to 2011 were primarily due to improved sales and continued cost control . floor plan interest expense and floor plan assistance floor plan interest expense decreased $ 0.4 million in 2013 compared to 2012. changes in the average outstanding balances on our floor plan facilities increased the expense $ 2.6 million , changes in the interest rates on our floor plan facilities decreased the expense $ 0.7 million and the maturity of three interest rate swaps decreased the expense $ 2.3 million . floor plan interest expense increased $ 2.5 million in 2012 compared to 2011. changes in the average outstanding balances on our floor plan facilities increased the expense $ 3.5 million and changes in the interest rates on our floor plan facilities decreased the expense $ 1.8 million during 2012 compared to 2011. ineffectiveness from hedging interest rate swaps increased the expense $ 0.8 million . floor plan assistance is provided by manufacturers to support store financing of new vehicle inventory . under accounting standards , floor plan assistance is recorded as a component of new vehicle gross profit when the specific vehicle is sold . however , because manufacturers provide this assistance to offset inventory carrying costs , we believe a comparison of floor plan interest expense to floor plan assistance is a useful measure of the efficiency of our new vehicle sales relative to stocking levels . 44 the following tables detail the carrying costs for new vehicles and include new vehicle floor plan interest net of floor plan assistance earned . replace_table_token_29_th replace_table_token_30_th other interest expense other interest expense includes interest on debt incurred related to acquisitions , real estate mortgages and our used vehicle inventory financing facility and our revolving line

liquidity and capital resources we manage our liquidity and capital resources to be able to fund our operating , investing and financing activities . we rely primarily on cash flows from operations and borrowings under our credit agreements as the main sources for liquidity . we use those funds to invest in capital expenditures , increase working capital and fulfill contractual obligations . funds available for reinvestment in our business are used for acquisitions as well as management of our capital structure through debt retirement , cash dividends and share repurchases . available sources below is a summary of our immediately available funds ( in thousands ) : replace_table_token_36_th our cash flows generated by operating activities and our credit facility are our most significant sources of liquidity . we have a $ 1.0 billion revolving syndicated credit facility which matures in december 2018. this facility provides new vehicle inventory floor plan financing , used vehicle inventory financing and a revolving line of credit for general corporate purposes . 48 we also have the ability to raise funds through mortgaging real estate . as of december 31 , 2013 , our unencumbered owned operating real estate had a book value of $ 181.0 million .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```liquidity and capital resources we manage our liquidity and capital resources to be able to fund our operating , investing and financing activities . we rely primarily on cash flows from operations and borrowings under our credit agreements as the main sources for liquidity . we use those funds to invest in capital expenditures , increase working capital and fulfill contractual obligations . funds available for reinvestment in our business are used for acquisitions as well as management of our capital structure through debt retirement , cash dividends and share repurchases . available sources below is a summary of our immediately available funds ( in thousands ) : replace_table_token_36_th our cash flows generated by operating activities and our credit facility are our most significant sources of liquidity . we have a $ 1.0 billion revolving syndicated credit facility which matures in december 2018. this facility provides new vehicle inventory floor plan financing , used vehicle inventory financing and a revolving line of credit for general corporate purposes . 48 we also have the ability to raise funds through mortgaging real estate . as of december 31 , 2013 , our unencumbered owned operating real estate had a book value of $ 181.0 million . ``` Suspicious Activity Report : we have determined that we operate as one reporting unit for evaluating goodwill . we have the option to qualitatively or quantitatively assess goodwill for impairment and , in 2013 , evaluated our goodwill using a quantitative assessment process . we test goodwill for impairment using the adjusted present value method ( “ apv ” ) to estimate the fair value of our reporting unit . under the apv method , future cash flows are based on recently prepared budget forecasts and business plans and are used to estimate the future economic benefits that the reporting unit will generate . an estimate of the appropriate discount rate is utilized to convert the future economic benefits to their present value equivalent . the quantitative goodwill impairment test is a two-step process . the first step identifies potential impairments by comparing the calculated fair value of a reporting unit with its book value . if the fair value of the reporting unit exceeds the carrying amount , goodwill is not impaired and the second step is not necessary . if the carrying value exceeds the fair value , the second step includes determining the implied fair value in the same manner as the amount of goodwill recognized in a business combination is determined . the implied fair value of goodwill is then compared with the carrying amount to determine if an impairment loss should be recorded . as of december 31 , 2013 , we had $ 49.5 million of goodwill on our balance sheet . the first step of our annual goodwill impairment analysis , which we perform as of october 1 of each year , did not result in an indication of impairment in 2013 , 2012 or 2011. the fair value of the reporting unit as of december 31 , 2013 , using the apv method , was 132 % greater than the carrying value at december 31 , 2013. we have determined the appropriate unit of accounting for testing franchise rights for impairment is on an individual store basis . we have the option to qualitatively or quantitatively assess indefinite-lived intangible assets for impairment . in 2013 , we evaluated our indefinite-lived intangible assets using a quantitative assessment process . we estimate the fair value of our franchise rights primarily using the multi-period excess earnings ( “ mpee ” ) model . the forecasted cash flows used in the mpee model contain inherent uncertainties , including significant estimates and assumptions related to growth rates , margins , general operating expenses , and cost of capital . we use primarily internally-developed forecasts and business plans to estimate the future cash flows that each franchise will generate . we have determined that only certain cash flows of the store are directly attributable to the franchise rights . we estimate the appropriate interest rate to discount future cash flows to their present value equivalent taking into consideration factors such as a risk-free rate , a peer group average beta , an equity risk premium and a small stock risk premium . we also may use a market approach to determine the fair value of our franchise rights . these market data points include our acquisition and divestiture experience and third-party broker estimates . as of december 31 , 2013 , we had $ 71.2 million of franchise value on our balance sheet associated with 57 stores . no individual store accounted for more than 12 % of our total franchise value as of december 31 , 2013. our impairment testing of franchise value did not indicate any impairment in 2013 , 2012 or 2011 . 32 we are subject to financial statement risk to the extent that our goodwill or franchise rights become impaired due to decreases in the fair value . a future decline in performance , decreases in projected growth rates or margin assumptions or changes in discount rates could result in a potential impairment , which could have a material adverse impact on our financial position and results of operations . furthermore , if a manufacturer becomes insolvent , we may be required to record a partial or total impairment on the franchise value related to that manufacturer . see notes 1 and 5 of notes to consolidated financial statements for additional information . long-lived assets we estimate the depreciable lives of our property and equipment , including leasehold improvements , and review each asset group for impairment when events or circumstances indicate that their carrying amounts may not be recoverable . we determined an asset group is comprised of the long-lived assets used in the operations of an individual store . we determine a triggering event has occurred by reviewing store forecasted and historical financial performance . an asset group is evaluated for recoverability if it has an operating loss in the current year and two of the prior three years . additionally , we may judgmentally evaluate an asset group if its financial performance indicates it may not support the carrying amount of the long-lived assets . if a store meets these criteria , we estimate the projected undiscounted cash flows for each asset group based on internally developed forecasts . if the undiscounted cash flows are lower than the carrying value of the asset group , we determine the fair value of the asset group based on additional market data , including recent experience in selling similar assets . we hold certain property for future development or investment purposes . if a triggering event is deemed to have occurred , we evaluate the property for impairment by comparing its estimated fair value based on listing price less costs to sell and other market data , including similar property that is for sale or has been recently sold , to the current carrying value . if the carrying value is more than the estimated fair value , an impairment is recorded . story_separator_special_tag selling , general and administrative expense ( “ sg & a ” ) sg & a includes salaries and related personnel expenses , advertising ( net of manufacturer cooperative advertising credits ) , rent , facility costs , and other general corporate expenses . replace_table_token_23_th replace_table_token_24_th 42 replace_table_token_25_th replace_table_token_26_th sg & a expense increased $ 53.7 million in 2013 compared to 2012. these increases were primarily driven by increased variable costs associated with improved sales and increases in advertising as we focused on gaining market share . additionally , in 2013 , we recorded a $ 6.2 million expense in other associated with a non-core legal reserve related to the settlement of a claim filed in 2006. this was offset by a $ 2.5 million non-core gain on the sale of property , which was recorded as a component of facility costs . in 2012 , sg & a expense increased $ 57.0 million as variable costs increased associated with sales growth . these increases in cost were offset by a continued focus on maintaining fixed costs . additionally , we recorded a non-core gain of $ 6.9 million on the sale of property as a component of facility costs in 2011. sg & a as a percentage of gross profit was 67.7 % in 2013 compared to 69.3 % in 2012 and 71.1 % in 2011. excluding the non-core legal reserve and gain on the sale of property in 2013 and the gain on the sale of property in 2011 , sg & a expense as a percentage of gross profit was 67.2 % in 2013 compared to 69.4 % in 2012 and 72.5 % in 2011. see “ non-gaap reconciliations ” in management 's discussion and analysis of financial condition and results of operations for more details . as sales volume increases and we further leverage our cost structure , we anticipate maintaining sg & a as a percentage of gross profit in the upper 60 % range in 2014. we also measure the leverage of our cost structure by evaluating throughput , which is the incremental percentage of gross profit retained after deducting sg & a expense . replace_table_token_27_th replace_table_token_28_th throughput contributions for newly opened or acquired stores reduce overall throughput as in the first year of operation , a store 's throughput is equal to the inverse of their sg & a as a percentage of gross profit . for example , a store which achieves sg & a as a percentage of gross profit of 70 % will have throughput of 30 % in the first year of operation . 43 we acquired six stores and opened one new store in 2013 and acquired four stores and opened two new stores in 2012. adjusting for these locations and the non-core adjustments discussed above , our throughput contribution on a same store basis was 51.4 % for the year ended december 31 , 2013 compared to 2012. our throughput contribution on a same store basis for 2012 compared to 2011 was 51.2 % . we continue to target a same store throughput contribution of approximately 50 % . depreciation and amortization depreciation and amortization is comprised of depreciation expense related to buildings , significant remodels or improvements , furniture , tools , equipment and signage and amortization of certain intangible assets , including customer lists and non-compete agreements . year ended december 31 , % ( dollars in thousands ) 2013 2012 increase increase depreciation and amortization $ 20,035 $ 17,128 $ 2,907 17.0 % year ended december 31 , % ( dollars in thousands ) 2012 2011 increase increase depreciation and amortization $ 17,128 $ 16,427 $ 701 4.3 % depreciation and amortization increased $ 2.9 million in 2013 compared to 2012 , and $ 0.7 million in 2012 compared to 2011 , as we purchased previously leased facilities , built new facilities subsequent to the acquisition of stores and invested in improvements at our facilities and replacement of equipment . these investments increase the amount of depreciable assets and amortizable expenses . operating income operating income was 4.6 % , 4.5 % and 4.2 % of revenue , respectively , in 2013 , 2012 and 2011. the increases in 2013 compared to 2012 , and 2012 compared to 2011 were primarily due to improved sales and continued cost control . floor plan interest expense and floor plan assistance floor plan interest expense decreased $ 0.4 million in 2013 compared to 2012. changes in the average outstanding balances on our floor plan facilities increased the expense $ 2.6 million , changes in the interest rates on our floor plan facilities decreased the expense $ 0.7 million and the maturity of three interest rate swaps decreased the expense $ 2.3 million . floor plan interest expense increased $ 2.5 million in 2012 compared to 2011. changes in the average outstanding balances on our floor plan facilities increased the expense $ 3.5 million and changes in the interest rates on our floor plan facilities decreased the expense $ 1.8 million during 2012 compared to 2011. ineffectiveness from hedging interest rate swaps increased the expense $ 0.8 million . floor plan assistance is provided by manufacturers to support store financing of new vehicle inventory . under accounting standards , floor plan assistance is recorded as a component of new vehicle gross profit when the specific vehicle is sold . however , because manufacturers provide this assistance to offset inventory carrying costs , we believe a comparison of floor plan interest expense to floor plan assistance is a useful measure of the efficiency of our new vehicle sales relative to stocking levels . 44 the following tables detail the carrying costs for new vehicles and include new vehicle floor plan interest net of floor plan assistance earned . replace_table_token_29_th replace_table_token_30_th other interest expense other interest expense includes interest on debt incurred related to acquisitions , real estate mortgages and our used vehicle inventory financing facility and our revolving line

operating income as a percentage of sales for fiscal year 2011 was 2.7 percent compared to 3.7 percent for fiscal year 2010. the decrease in operating income as a percentage of sales was due to a decline in gross margin , partially offset by the leveraging of certain operating expenses and by improving efficiencies during fiscal year 2011. net income for fiscal year 2011 was $ 5.7 million or $ 0.55 per diluted share , as compared to net income of $ 8.7 million or $ 0.85 per diluted share for fiscal year 2010. the decrease in net income for fiscal year 2011 as compared to fiscal year 2010 was primarily due to an approximate 1.5 percentage point decline in our gross margin . also , our fiscal year 2010 results include an income tax benefit of $ 1.4 million , resulting in part from the release of our valuation allowance on deferred tax assets related to our domestic net operating loss carryforwards that occurred in the third quarter of fiscal 2010 . 16 we maintain a strong balance sheet with a current ratio of 2.7 and a long-term debt to equity ratio of 0.11. total cash used in operating activities as defined on our cash flow statement was $ 2.6 million during fiscal year 2011. however , we maintain sufficient liquidity for our expected future operations and had $ 6.0 million in borrowings on our revolving line of credit with wells fargo , n.a . of which $ 24.0 million remained available at july 2 , 2011. we believe cash flow from operations , our borrowing capacity , and equipment lease financing should provide adequate capital for planned growth over the long term . results of operations comparison of the fiscal year ended july 2 , 2011 with the fiscal year ended july 3 , 2010 the following table sets forth for the periods indicated certain items of the consolidated statements of income expressed as a percentage of net sales . the financial information and discussion below should be read in conjunction with the consolidated financial statements and notes contained in this annual report . replace_table_token_5_th * percent change from negative to positive is not considered meaningful . net sales net sales were $ 253.8 million , and $ 199.6 million in fiscal years 2011 and 2010 , respectively . net sales increased $ 54.2 million during fiscal year 2011 as compared with fiscal year 2010. this increase in net sales was primarily driven by an approximate $ 77.9 million increase in revenues related to new programs for both new and longstanding customers . this was partially offset by a $ 18.5 million decline related to decreased demand from certain current customer programs . in addition , during fiscal year 2011 we experienced an approximately $ 5.2 million decline related to the negative impact of end-of-life customer programs and to a lesser extent customer program losses . the negative impact resulting from industry-wide shortages in the global supply chain that occurred throughout most of the year and the uncertain macroeconomic environment are reflected in the analysis of our new and longstanding customers programs as discussed above . 17 the following table shows the revenue by industry sectors as a percentage of revenue for fiscal years 2011 and 2010 : replace_table_token_6_th we provide services to customers in a number of industries and produce a variety of products for our customers in each industry . as we continue to diversify our customer base and win new customers we may continue to see a change in the industry concentrations of our revenue . sales to foreign locations represented 31.9 percent , and 17.9 percent of our total net sales in fiscal years 2011 , and 2010 , respectively . cost of sales total cost of sales as a percentage of net sales was 91.9 percent , and 90.4 percent in fiscal years 2011 , and 2010 , respectively . total cost of materials as a percentage of net sales was approximately 73.9 percent , and 68.6 percent in fiscal years 2011 , and 2010 , respectively . the change from year-to-year is primarily the result of higher material content in certain new customer programs and changes in product mix . production and support costs as a percentage of net sales were 18.0 percent , and 21.8 percent in fiscal years 2011 , and 2010 , respectively . the decrease in fiscal year 2011 is primarily related to the leveraging of our fixed costs as a percentage of sales during the fiscal year . we provide for obsolete and non-saleable inventories based on specific identification of inventory against current demand and recent usage . the amounts charged to expense for these inventories were approximately $ 0.3 million , and $ 2.2 million in fiscal years 2011 , and 2010 , respectively . the large provision in fiscal year 2010 was primarily due to a discontinuance of manufacturing for certain customers that became no longer viable . we provide warranties on certain products we sell and estimate warranty costs based on historical experience and anticipated product returns . the amounts charged to expense are determined based on an estimate of warranty exposure . the net warranty expense was approximately $ 158,000 and $ 45,000 in fiscal years 2011 , and 2010 , respectively . warranty expense for fiscal years 2011 and 2010 is related to workmanship claims on keyboards and ems products . gross profit gross profit as a percentage of net sales was 8.1 percent , and 9.6 percent in fiscal years 2011 , and 2010 , respectively . story_separator_special_tag in addition to the cash requirements presented above , we have various other accruals which are not included in the table above . we owe our suppliers approximately $ 21.4 million for accounts payable and shipments in transit at the end of the fiscal year . we generally pay our suppliers in a range from 30 to 120 24 days depending on terms offered . these payments are financed by operating cash flows and our revolving line of credit . we believe that cash flows generated from operations , leasing facilities , and funds available under the revolving credit facility will satisfy cash requirements for a period in excess of 12 months and into the foreseeable future . critical accounting policies and estimates preparation of our consolidated financial statements requires management to make estimates and assumptions that affect the reported amount of assets , liabilities , revenues and expenses . note 1 to our consolidated financial statements describes the significant accounting policies used in the preparation of our consolidated financial statements . management believes the most complex and sensitive judgments , because of their significance to our consolidated financial statements , result primarily from the need to make estimates about effects of matters that are inherently uncertain . the most significant areas involving management judgments are described below . actual results in these areas could differ from management 's estimates . inactive , obsolete , and surplus inventory reserve we reserve for inventories that we deem inactive , obsolete or surplus . this reserve is calculated based upon the demand for the products that we produce . demand is determined by expected sales or customer forecasts . if expected sales do not materialize , then we would have inventory in excess of our reserves and would have to charge the excess against future earnings . in the case where we have purchased material based upon a customer 's forecast , we are usually covered by lead-time assurance agreements with each customer . these contracts state that the financial liability for material purchased within agreed upon lead-time and based upon the customer 's forecasts , lies with the customer . if we purchase material outside the lead-time assurance agreement and the customer 's forecasts do not materialize or if we have no lead-time assurance agreement for a specific program , we would have the financial liability and may have to charge inactive , obsolete or surplus inventory against earnings . allowance for doubtful accounts we value our accounts receivable net of an allowance for doubtful accounts of $ 111,000 at july 2 , 2011 and july 3 , 2010. this allowance is based on estimates of the portion of accounts receivable that may not be collected in the future . the estimates used are based primarily on specific identification of potentially uncollectible accounts . such accounts are identified using publicly available information in conjunction with evaluations of current payment activity . however , if any of our customers were to develop unexpected and immediate financial problems that would prevent payment of open invoices , we could incur additional and possibly material expenses that would negatively impact earnings . accrued warranty an accrual is made for expected warranty costs , with the related expense recognized in cost of goods sold . we review the adequacy of this accrual quarterly based on historical analysis and anticipated product returns and rework costs . as we have made the transition from manufacturing primarily keyboards to primarily ems products , our exposure to warranty claims has declined significantly . our warranty period for keyboards is generally longer than that for ems products . we only warrant materials and workmanship on ems products , and we do not warrant design defects for ems customers . income taxes income tax expense includes u.s. and international income taxes and the provision for u.s. taxes on undistributed earnings of international subsidiaries not deemed to be permanently invested . certain income and expenses are not reported in tax returns and financial statements in the same year . the tax effect of such temporary differences is reported as deferred income taxes . the deferred income taxes are classified as current or long-term based on the classification of the related asset or liability . the most significant areas involving management judgments include deferred income tax assets and liabilities , uncertain tax positions , and research and development tax credits . our estimates of the realization of the deferred tax assets related to our net operating loss carryforwards and tax credits is based upon our estimates of future taxable income which may change . 25 stock-based compensation stock-based compensation is accounted for according to financial accounting standards board ( fasb ) accounting standards codification ( asc ) 718 , compensation – stock compensation . asc 718 requires us to expense the fair value of employee stock options , stock appreciation rights and other forms of stock-based compensation . under the fair value recognition provisions of asc 718 , share-based compensation cost is estimated at the grant date based upon the value of the stock option and at each reporting period for stock appreciation rights classified as liability awards and is recognized as expense ratably over the requisite service period of the award ( generally the vesting ) . determining the appropriate fair value model and calculating the fair value of share-based awards requires judgment , including estimating the expected life of the share-based award , the expected stock price volatility over the expected life of the share-based award and forfeitures . to determine the fair value of stock based awards on the date of grant and at each reporting period for any stock appreciation rights that may be classified as liability awards , we use the black-scholes option-pricing model . inherent in this model are assumptions related to expected stock price volatility , option life , risk-free interest rate and dividend yield . the risk-free interest rate is a less-subjective assumption as it is

capital resources and liquidity cash flows used in operating activities were $ 2.6 million in fiscal year 2011 as compared to cash provided by operating activities of $ 3.7 million and $ 10.0 million in fiscal years 2010 and 2009 , respectively . the $ 6.3 million decrease in cash provided by operating activities in fiscal year 2011 as compared with fiscal year 2010 was primarily due to an increase in trade receivables , inventory , and a decrease in accounts payable . trade receivables increased by $ 5.7 million as a result of the increase in sales that occurred during the fourth quarter of fiscal year 2011. the $ 2.1 million increase in inventory was attributable to our recent and expected growth in production levels for a number of new programs . we purchase inventory based on customer forecasts and orders and expected lead times , and when those forecasts can not be met or changes are made to lead times , inventory can increase . the $ 3.0 million decrease in accounts payable was primarily driven by the timing of payments and terms of the supply chain related to new programs . accounts payable fluctuates with changes in inventory levels , volume of purchases , and negotiated supplier terms . the $ 6.3 million decrease in cash provided by operating activities in fiscal year 2010 as compared with fiscal year 2009 was primarily due to an increase in trade receivables and inventory , partially offset by an increase in accounts payable . trade receivables increased by $ 10.1 million as a result of the increase in sales that occurred during the fourth quarter of fiscal year 2010. the $ 9.7 million increase in inventory was attributable to new customer programs and increasing lead times on certain components which led to some scheduled shipments not being shipped by the end of the fiscal year . we purchase inventory based on customer forecasts and orders and expected lead times , and when those forecasts can not be met or changes are made to lead times , inventory can increase .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```capital resources and liquidity cash flows used in operating activities were $ 2.6 million in fiscal year 2011 as compared to cash provided by operating activities of $ 3.7 million and $ 10.0 million in fiscal years 2010 and 2009 , respectively . the $ 6.3 million decrease in cash provided by operating activities in fiscal year 2011 as compared with fiscal year 2010 was primarily due to an increase in trade receivables , inventory , and a decrease in accounts payable . trade receivables increased by $ 5.7 million as a result of the increase in sales that occurred during the fourth quarter of fiscal year 2011. the $ 2.1 million increase in inventory was attributable to our recent and expected growth in production levels for a number of new programs . we purchase inventory based on customer forecasts and orders and expected lead times , and when those forecasts can not be met or changes are made to lead times , inventory can increase . the $ 3.0 million decrease in accounts payable was primarily driven by the timing of payments and terms of the supply chain related to new programs . accounts payable fluctuates with changes in inventory levels , volume of purchases , and negotiated supplier terms . the $ 6.3 million decrease in cash provided by operating activities in fiscal year 2010 as compared with fiscal year 2009 was primarily due to an increase in trade receivables and inventory , partially offset by an increase in accounts payable . trade receivables increased by $ 10.1 million as a result of the increase in sales that occurred during the fourth quarter of fiscal year 2010. the $ 9.7 million increase in inventory was attributable to new customer programs and increasing lead times on certain components which led to some scheduled shipments not being shipped by the end of the fiscal year . we purchase inventory based on customer forecasts and orders and expected lead times , and when those forecasts can not be met or changes are made to lead times , inventory can increase . ``` Suspicious Activity Report : operating income as a percentage of sales for fiscal year 2011 was 2.7 percent compared to 3.7 percent for fiscal year 2010. the decrease in operating income as a percentage of sales was due to a decline in gross margin , partially offset by the leveraging of certain operating expenses and by improving efficiencies during fiscal year 2011. net income for fiscal year 2011 was $ 5.7 million or $ 0.55 per diluted share , as compared to net income of $ 8.7 million or $ 0.85 per diluted share for fiscal year 2010. the decrease in net income for fiscal year 2011 as compared to fiscal year 2010 was primarily due to an approximate 1.5 percentage point decline in our gross margin . also , our fiscal year 2010 results include an income tax benefit of $ 1.4 million , resulting in part from the release of our valuation allowance on deferred tax assets related to our domestic net operating loss carryforwards that occurred in the third quarter of fiscal 2010 . 16 we maintain a strong balance sheet with a current ratio of 2.7 and a long-term debt to equity ratio of 0.11. total cash used in operating activities as defined on our cash flow statement was $ 2.6 million during fiscal year 2011. however , we maintain sufficient liquidity for our expected future operations and had $ 6.0 million in borrowings on our revolving line of credit with wells fargo , n.a . of which $ 24.0 million remained available at july 2 , 2011. we believe cash flow from operations , our borrowing capacity , and equipment lease financing should provide adequate capital for planned growth over the long term . results of operations comparison of the fiscal year ended july 2 , 2011 with the fiscal year ended july 3 , 2010 the following table sets forth for the periods indicated certain items of the consolidated statements of income expressed as a percentage of net sales . the financial information and discussion below should be read in conjunction with the consolidated financial statements and notes contained in this annual report . replace_table_token_5_th * percent change from negative to positive is not considered meaningful . net sales net sales were $ 253.8 million , and $ 199.6 million in fiscal years 2011 and 2010 , respectively . net sales increased $ 54.2 million during fiscal year 2011 as compared with fiscal year 2010. this increase in net sales was primarily driven by an approximate $ 77.9 million increase in revenues related to new programs for both new and longstanding customers . this was partially offset by a $ 18.5 million decline related to decreased demand from certain current customer programs . in addition , during fiscal year 2011 we experienced an approximately $ 5.2 million decline related to the negative impact of end-of-life customer programs and to a lesser extent customer program losses . the negative impact resulting from industry-wide shortages in the global supply chain that occurred throughout most of the year and the uncertain macroeconomic environment are reflected in the analysis of our new and longstanding customers programs as discussed above . 17 the following table shows the revenue by industry sectors as a percentage of revenue for fiscal years 2011 and 2010 : replace_table_token_6_th we provide services to customers in a number of industries and produce a variety of products for our customers in each industry . as we continue to diversify our customer base and win new customers we may continue to see a change in the industry concentrations of our revenue . sales to foreign locations represented 31.9 percent , and 17.9 percent of our total net sales in fiscal years 2011 , and 2010 , respectively . cost of sales total cost of sales as a percentage of net sales was 91.9 percent , and 90.4 percent in fiscal years 2011 , and 2010 , respectively . total cost of materials as a percentage of net sales was approximately 73.9 percent , and 68.6 percent in fiscal years 2011 , and 2010 , respectively . the change from year-to-year is primarily the result of higher material content in certain new customer programs and changes in product mix . production and support costs as a percentage of net sales were 18.0 percent , and 21.8 percent in fiscal years 2011 , and 2010 , respectively . the decrease in fiscal year 2011 is primarily related to the leveraging of our fixed costs as a percentage of sales during the fiscal year . we provide for obsolete and non-saleable inventories based on specific identification of inventory against current demand and recent usage . the amounts charged to expense for these inventories were approximately $ 0.3 million , and $ 2.2 million in fiscal years 2011 , and 2010 , respectively . the large provision in fiscal year 2010 was primarily due to a discontinuance of manufacturing for certain customers that became no longer viable . we provide warranties on certain products we sell and estimate warranty costs based on historical experience and anticipated product returns . the amounts charged to expense are determined based on an estimate of warranty exposure . the net warranty expense was approximately $ 158,000 and $ 45,000 in fiscal years 2011 , and 2010 , respectively . warranty expense for fiscal years 2011 and 2010 is related to workmanship claims on keyboards and ems products . gross profit gross profit as a percentage of net sales was 8.1 percent , and 9.6 percent in fiscal years 2011 , and 2010 , respectively . story_separator_special_tag in addition to the cash requirements presented above , we have various other accruals which are not included in the table above . we owe our suppliers approximately $ 21.4 million for accounts payable and shipments in transit at the end of the fiscal year . we generally pay our suppliers in a range from 30 to 120 24 days depending on terms offered . these payments are financed by operating cash flows and our revolving line of credit . we believe that cash flows generated from operations , leasing facilities , and funds available under the revolving credit facility will satisfy cash requirements for a period in excess of 12 months and into the foreseeable future . critical accounting policies and estimates preparation of our consolidated financial statements requires management to make estimates and assumptions that affect the reported amount of assets , liabilities , revenues and expenses . note 1 to our consolidated financial statements describes the significant accounting policies used in the preparation of our consolidated financial statements . management believes the most complex and sensitive judgments , because of their significance to our consolidated financial statements , result primarily from the need to make estimates about effects of matters that are inherently uncertain . the most significant areas involving management judgments are described below . actual results in these areas could differ from management 's estimates . inactive , obsolete , and surplus inventory reserve we reserve for inventories that we deem inactive , obsolete or surplus . this reserve is calculated based upon the demand for the products that we produce . demand is determined by expected sales or customer forecasts . if expected sales do not materialize , then we would have inventory in excess of our reserves and would have to charge the excess against future earnings . in the case where we have purchased material based upon a customer 's forecast , we are usually covered by lead-time assurance agreements with each customer . these contracts state that the financial liability for material purchased within agreed upon lead-time and based upon the customer 's forecasts , lies with the customer . if we purchase material outside the lead-time assurance agreement and the customer 's forecasts do not materialize or if we have no lead-time assurance agreement for a specific program , we would have the financial liability and may have to charge inactive , obsolete or surplus inventory against earnings . allowance for doubtful accounts we value our accounts receivable net of an allowance for doubtful accounts of $ 111,000 at july 2 , 2011 and july 3 , 2010. this allowance is based on estimates of the portion of accounts receivable that may not be collected in the future . the estimates used are based primarily on specific identification of potentially uncollectible accounts . such accounts are identified using publicly available information in conjunction with evaluations of current payment activity . however , if any of our customers were to develop unexpected and immediate financial problems that would prevent payment of open invoices , we could incur additional and possibly material expenses that would negatively impact earnings . accrued warranty an accrual is made for expected warranty costs , with the related expense recognized in cost of goods sold . we review the adequacy of this accrual quarterly based on historical analysis and anticipated product returns and rework costs . as we have made the transition from manufacturing primarily keyboards to primarily ems products , our exposure to warranty claims has declined significantly . our warranty period for keyboards is generally longer than that for ems products . we only warrant materials and workmanship on ems products , and we do not warrant design defects for ems customers . income taxes income tax expense includes u.s. and international income taxes and the provision for u.s. taxes on undistributed earnings of international subsidiaries not deemed to be permanently invested . certain income and expenses are not reported in tax returns and financial statements in the same year . the tax effect of such temporary differences is reported as deferred income taxes . the deferred income taxes are classified as current or long-term based on the classification of the related asset or liability . the most significant areas involving management judgments include deferred income tax assets and liabilities , uncertain tax positions , and research and development tax credits . our estimates of the realization of the deferred tax assets related to our net operating loss carryforwards and tax credits is based upon our estimates of future taxable income which may change . 25 stock-based compensation stock-based compensation is accounted for according to financial accounting standards board ( fasb ) accounting standards codification ( asc ) 718 , compensation – stock compensation . asc 718 requires us to expense the fair value of employee stock options , stock appreciation rights and other forms of stock-based compensation . under the fair value recognition provisions of asc 718 , share-based compensation cost is estimated at the grant date based upon the value of the stock option and at each reporting period for stock appreciation rights classified as liability awards and is recognized as expense ratably over the requisite service period of the award ( generally the vesting ) . determining the appropriate fair value model and calculating the fair value of share-based awards requires judgment , including estimating the expected life of the share-based award , the expected stock price volatility over the expected life of the share-based award and forfeitures . to determine the fair value of stock based awards on the date of grant and at each reporting period for any stock appreciation rights that may be classified as liability awards , we use the black-scholes option-pricing model . inherent in this model are assumptions related to expected stock price volatility , option life , risk-free interest rate and dividend yield . the risk-free interest rate is a less-subjective assumption as it is

if any such event occurs , we would be forced to consider alternative financing options . on april 18 , 2018 , we announced that our board of directors had initiated a review of strategic alternatives , which could include strategic mergers , reverse mergers , the issuance or buyback of public shares , or the purchase or sale of specific assets , in addition to other potential actions aimed at increasing shareholder value . the company engaged b. riley fbr , inc. as its exclusive financial advisor during this process . the company does not intend to disclose or comment on developments related to its review unless and until the board has approved a specific transaction or otherwise determined that further disclosure is appropriate . there can be no assurance that the board 's strategic review will result in any transaction , or any assurance as to its outcome or timing . story_separator_special_tag clients to spend any remaining funds budgeted for services and capital expenditures during the year . our clients ' annual budget process is normally completed in the first quarter , which can slow the award of new work at the beginning of the year . principally due to these factors , our first and fourth quarters are typically less robust than our second and third quarters . critical accounting policies please see item 8 , note 2 – accounting policies and new accounting pronouncements for additional information regarding our critical accounting policies . 21 item 8. financial statements and supplementary data the audited financial information below is attached hereto and made part hereof : index page report of independent registered public accounting firm 23 consolidated balance sheets 24 consolidated statements of operations 25 consolidated statements of stockholders ' equity 26 consolidated statements of cash flows 27 notes to consolidated financial statements 28 22 report of independent registered public accounting firm to the shareholders and the board of directors of englobal corporation opinion on the financial statements we have audited the accompanying consolidated balance sheets of englobal corporation and subsidiaries ( the “ company ” ) as of december 28 , 2019 and december 29 , 2018 , and the related consolidated statements of operations , stockholders ' equity and cash flows for the years then ended , and the related notes ( collectively referred to as the “ consolidated financial statements ” ) . in our opinion , the consolidated financial statements present fairly , in all material respects , the consolidated financial position of the company as of december 28 , 2019 and december 29 , 2018 , and the consolidated results of its operations and its cash flows for the years then ended , in conformity with accounting principles generally accepted in the united states of america . change in accounting principle as discussed in note 2 to the consolidated financial statements , the company changed its method of accounting for leases in 2019 due to the adoption of accounting standards codification topic no . 842. basis for opinion these consolidated financial statements are the responsibility of the company 's management . our responsibility is to express an opinion on the company 's consolidated financial statements based on our audits . we are a public accounting firm registered with the public company accounting oversight board ( united states ) ( “ pcaob ” ) and are required to be independent with respect to the company in accordance with the u.s. federal securities laws and the applicable rules and regulations of the securities and exchange commission and the pcaob . we conducted our audits in accordance with the standards of the pcaob . those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement , whether due to error or fraud . the company is not required to have , nor were we engaged to perform , an audit of its internal control over financial reporting . as part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the company 's internal control over financial reporting . accordingly , we express no such opinion . our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements , whether due to error or fraud , and performing procedures to respond to those risks . such procedures included examining , on a test basis , evidence regarding the amounts and disclosures in the consolidated financial statements . our audits also included evaluating the accounting principles used and significant estimates made by management , as well as evaluating the overall presentation of the consolidated financial statements . we believe that our audits provide a reasonable basis for our opinion . moss adams llp houston , texas march 26 , 2020 we have served as the company 's auditor since 2017 . 23 englobal corporation and subsidiaries consolidated balance sheets ( amounts in thousands , except share amounts ) replace_table_token_4_th see accompanying notes to consolidated financial statements . 24 englobal corporation and subsidiaries consolidated statements of operations ( amounts in thousands , except per share amounts ) replace_table_token_5_th see accompanying notes to consolidated financial statements . 25 englobal corporation and subsidiaries consolidated statements of stockholders ' equity ( amounts in thousands ) replace_table_token_6_th see accompanying notes to consolidated financial statements . 26 englobal corporation and subsidiaries consolidated statements of cash flows ( amounts in thousands ) replace_table_token_7_th see accompanying notes to consolidated financial statements . story_separator_special_tag the selection of the method to measure progress towards completion requires judgment and is based on the nature of the products or service to be provided , which measures the ratio of costs incurred to date to the total estimated costs at completion of the performance obligation . we generally use the cost-to-cost method on the labor portion of a project for revenue recognition to measure progress of our contracts because it best depicts the transfer of control to the customer which occurs as we consume the materials on the contracts . therefore , revenues and estimated profits are recorded proportionally as labor costs are incurred . under the typical payment terms of our fixed-price contracts , the customer pays us progress payments . these progress payments are based on quantifiable measures of performance or on the achievement of specified events or milestones . the customer may retain a small portion of the contract price until completion of the contract . revenue recognized in excess of billings is recorded as a contract asset on the balance sheet . amounts billed and due from our customers are classified as receivables on the balance sheet . the portion of the payments retained by the customer until final contract settlement is not considered a significant financing component because the intent is to protect the customer should we fail to adequately complete some or all of our obligations under the contract . for some contracts we may receive advance payments from the customer . we record a liability for these advance payments in contract liabilities on the balance sheet . the advance payment typically is not considered a significant financing component because it is used to meet working capital demand that can be higher in the early stages of a contract and to protect us from the other party failing to adequately complete some or all of its obligations under the contract . to determine proper revenue recognition for contracts , we evaluate whether two or more contracts should be combined and accounted for as one single performance obligation or whether a single contract should be accounted for as more than one performance obligation . this evaluation requires significant judgment and the decision to combine a group of contracts or separate a single contract into multiple performance obligations could change the amount of revenue and profit recorded in a given period . for most of our contracts , we provide a significant service of integrating a complex set of tasks and components into a single project . hence , the entire contract is accounted for as one performance obligation . less commonly , we may provide distinct goods or services within a contract in which case we separate the contract into more than one performance obligation . if a contract is separated into more than one performance obligation , we allocate the total transaction price to each performance obligation in an amount based on the estimated relative standalone selling price of the promised goods or services underlying each performance obligation and use the expected cost plus margin approach to estimate the standalone selling price of each performance obligation . due to the nature of the work required to be performed on many of our performance obligations , the estimation of total revenue and cost at completion is complex , subject to variables and requires significant judgment . we estimate variable consideration at the most likely amount to which we expect to be entitled . we include estimated amounts in the transaction price to the extent it is probable that a significant reversal of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is resolved . our estimates of variable consideration and determination of whether to include estimated amounts in the transaction price are based largely on an assessment of our anticipated performance and all information ( historical , current and forecasted ) that is reasonably available to us . 30 contracts are often modified to account for changes in contract specifications and requirements . we consider contract modifications to exist when the modification either creates new or changes the existing enforceable rights and obligations . most of our contract modifications are for goods or services that are not distinct from the existing contract due to the significant integration service provided in the context of the contract and are accounted for as if they were part of that existing contract . the effect of a contract modification on the transaction price and our measure of progress for the performance obligation to which it relates , is recognized as an adjustment to revenue ( either as an increase or a reduction of revenue ) on a cumulative catch-up basis . we have a standard , monthly process in which management reviews the progress and execution of our performance obligations . as part of this process , management reviews information including , but not limited to , any outstanding key contract matters , progress towards completion and the related program schedule , identified risks and opportunities and the related changes in estimates of revenues and costs . the risks and opportunities include management 's judgment about the ability and cost to achieve the schedule , technical requirements , and other contractual requirements . management must make assumptions and estimates regarding labor productivity and availability , the complexity of the work to be performed , the availability of materials , the length of time to complete the performance obligation , execution by our subcontractors , the availability and timing of funding from our customer and overhead cost rates , among other variables . based on this analysis , any adjustments to revenue , operating costs and the related impact to operating income are recognized as necessary in the period they become known . these adjustments may result from positive performance and may result in an increase in operating income during the performance of individual performance obligations if we determine we will be successful

cash flows from operating activities operating activities provided approximately $ 2.7 million in net cash during the year ended december 28 , 2019 , compared with net cash used of $ 3.4 million during the comparable period in 2018. the primary driver of the cash provided by operations for the year ended december 28 , 2019 was an increase of $ 4.2 million from contract assets net of contract liabilities and $ 1.2 million in cash provided by other working capital items , offset by our net loss of $ 1.5 million and an increase in trade receivables of $ 1.2 million . for the year ended december 29 , 2018 , cash used by operations was primarily related to our net loss of $ 5.7 million less non-cash expenses of goodwill impairment , depreciation , amortization and stock compensation resulting in a net $ 3.0 million use of cash . cash flows from investing activities investing activities used cash of $ 0.3 million during the year ended december 28 , 2019 and used cash of $ 0.1 million during the year ended december 29 , 2018 primarily related to the purchase of equipment used to outfit our fabrication facility . for the year ended december 28 , 2019 , investing activities were primarily expenditures for property and equipment of $ 0.3 million . for the year ended december 29 , 2018 , cash used for investing activities was primarily related to expenditures for property and equipment of $ 0.1 million .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```cash flows from operating activities operating activities provided approximately $ 2.7 million in net cash during the year ended december 28 , 2019 , compared with net cash used of $ 3.4 million during the comparable period in 2018. the primary driver of the cash provided by operations for the year ended december 28 , 2019 was an increase of $ 4.2 million from contract assets net of contract liabilities and $ 1.2 million in cash provided by other working capital items , offset by our net loss of $ 1.5 million and an increase in trade receivables of $ 1.2 million . for the year ended december 29 , 2018 , cash used by operations was primarily related to our net loss of $ 5.7 million less non-cash expenses of goodwill impairment , depreciation , amortization and stock compensation resulting in a net $ 3.0 million use of cash . cash flows from investing activities investing activities used cash of $ 0.3 million during the year ended december 28 , 2019 and used cash of $ 0.1 million during the year ended december 29 , 2018 primarily related to the purchase of equipment used to outfit our fabrication facility . for the year ended december 28 , 2019 , investing activities were primarily expenditures for property and equipment of $ 0.3 million . for the year ended december 29 , 2018 , cash used for investing activities was primarily related to expenditures for property and equipment of $ 0.1 million . ``` Suspicious Activity Report : if any such event occurs , we would be forced to consider alternative financing options . on april 18 , 2018 , we announced that our board of directors had initiated a review of strategic alternatives , which could include strategic mergers , reverse mergers , the issuance or buyback of public shares , or the purchase or sale of specific assets , in addition to other potential actions aimed at increasing shareholder value . the company engaged b. riley fbr , inc. as its exclusive financial advisor during this process . the company does not intend to disclose or comment on developments related to its review unless and until the board has approved a specific transaction or otherwise determined that further disclosure is appropriate . there can be no assurance that the board 's strategic review will result in any transaction , or any assurance as to its outcome or timing . story_separator_special_tag clients to spend any remaining funds budgeted for services and capital expenditures during the year . our clients ' annual budget process is normally completed in the first quarter , which can slow the award of new work at the beginning of the year . principally due to these factors , our first and fourth quarters are typically less robust than our second and third quarters . critical accounting policies please see item 8 , note 2 – accounting policies and new accounting pronouncements for additional information regarding our critical accounting policies . 21 item 8. financial statements and supplementary data the audited financial information below is attached hereto and made part hereof : index page report of independent registered public accounting firm 23 consolidated balance sheets 24 consolidated statements of operations 25 consolidated statements of stockholders ' equity 26 consolidated statements of cash flows 27 notes to consolidated financial statements 28 22 report of independent registered public accounting firm to the shareholders and the board of directors of englobal corporation opinion on the financial statements we have audited the accompanying consolidated balance sheets of englobal corporation and subsidiaries ( the “ company ” ) as of december 28 , 2019 and december 29 , 2018 , and the related consolidated statements of operations , stockholders ' equity and cash flows for the years then ended , and the related notes ( collectively referred to as the “ consolidated financial statements ” ) . in our opinion , the consolidated financial statements present fairly , in all material respects , the consolidated financial position of the company as of december 28 , 2019 and december 29 , 2018 , and the consolidated results of its operations and its cash flows for the years then ended , in conformity with accounting principles generally accepted in the united states of america . change in accounting principle as discussed in note 2 to the consolidated financial statements , the company changed its method of accounting for leases in 2019 due to the adoption of accounting standards codification topic no . 842. basis for opinion these consolidated financial statements are the responsibility of the company 's management . our responsibility is to express an opinion on the company 's consolidated financial statements based on our audits . we are a public accounting firm registered with the public company accounting oversight board ( united states ) ( “ pcaob ” ) and are required to be independent with respect to the company in accordance with the u.s. federal securities laws and the applicable rules and regulations of the securities and exchange commission and the pcaob . we conducted our audits in accordance with the standards of the pcaob . those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement , whether due to error or fraud . the company is not required to have , nor were we engaged to perform , an audit of its internal control over financial reporting . as part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the company 's internal control over financial reporting . accordingly , we express no such opinion . our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements , whether due to error or fraud , and performing procedures to respond to those risks . such procedures included examining , on a test basis , evidence regarding the amounts and disclosures in the consolidated financial statements . our audits also included evaluating the accounting principles used and significant estimates made by management , as well as evaluating the overall presentation of the consolidated financial statements . we believe that our audits provide a reasonable basis for our opinion . moss adams llp houston , texas march 26 , 2020 we have served as the company 's auditor since 2017 . 23 englobal corporation and subsidiaries consolidated balance sheets ( amounts in thousands , except share amounts ) replace_table_token_4_th see accompanying notes to consolidated financial statements . 24 englobal corporation and subsidiaries consolidated statements of operations ( amounts in thousands , except per share amounts ) replace_table_token_5_th see accompanying notes to consolidated financial statements . 25 englobal corporation and subsidiaries consolidated statements of stockholders ' equity ( amounts in thousands ) replace_table_token_6_th see accompanying notes to consolidated financial statements . 26 englobal corporation and subsidiaries consolidated statements of cash flows ( amounts in thousands ) replace_table_token_7_th see accompanying notes to consolidated financial statements . story_separator_special_tag the selection of the method to measure progress towards completion requires judgment and is based on the nature of the products or service to be provided , which measures the ratio of costs incurred to date to the total estimated costs at completion of the performance obligation . we generally use the cost-to-cost method on the labor portion of a project for revenue recognition to measure progress of our contracts because it best depicts the transfer of control to the customer which occurs as we consume the materials on the contracts . therefore , revenues and estimated profits are recorded proportionally as labor costs are incurred . under the typical payment terms of our fixed-price contracts , the customer pays us progress payments . these progress payments are based on quantifiable measures of performance or on the achievement of specified events or milestones . the customer may retain a small portion of the contract price until completion of the contract . revenue recognized in excess of billings is recorded as a contract asset on the balance sheet . amounts billed and due from our customers are classified as receivables on the balance sheet . the portion of the payments retained by the customer until final contract settlement is not considered a significant financing component because the intent is to protect the customer should we fail to adequately complete some or all of our obligations under the contract . for some contracts we may receive advance payments from the customer . we record a liability for these advance payments in contract liabilities on the balance sheet . the advance payment typically is not considered a significant financing component because it is used to meet working capital demand that can be higher in the early stages of a contract and to protect us from the other party failing to adequately complete some or all of its obligations under the contract . to determine proper revenue recognition for contracts , we evaluate whether two or more contracts should be combined and accounted for as one single performance obligation or whether a single contract should be accounted for as more than one performance obligation . this evaluation requires significant judgment and the decision to combine a group of contracts or separate a single contract into multiple performance obligations could change the amount of revenue and profit recorded in a given period . for most of our contracts , we provide a significant service of integrating a complex set of tasks and components into a single project . hence , the entire contract is accounted for as one performance obligation . less commonly , we may provide distinct goods or services within a contract in which case we separate the contract into more than one performance obligation . if a contract is separated into more than one performance obligation , we allocate the total transaction price to each performance obligation in an amount based on the estimated relative standalone selling price of the promised goods or services underlying each performance obligation and use the expected cost plus margin approach to estimate the standalone selling price of each performance obligation . due to the nature of the work required to be performed on many of our performance obligations , the estimation of total revenue and cost at completion is complex , subject to variables and requires significant judgment . we estimate variable consideration at the most likely amount to which we expect to be entitled . we include estimated amounts in the transaction price to the extent it is probable that a significant reversal of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is resolved . our estimates of variable consideration and determination of whether to include estimated amounts in the transaction price are based largely on an assessment of our anticipated performance and all information ( historical , current and forecasted ) that is reasonably available to us . 30 contracts are often modified to account for changes in contract specifications and requirements . we consider contract modifications to exist when the modification either creates new or changes the existing enforceable rights and obligations . most of our contract modifications are for goods or services that are not distinct from the existing contract due to the significant integration service provided in the context of the contract and are accounted for as if they were part of that existing contract . the effect of a contract modification on the transaction price and our measure of progress for the performance obligation to which it relates , is recognized as an adjustment to revenue ( either as an increase or a reduction of revenue ) on a cumulative catch-up basis . we have a standard , monthly process in which management reviews the progress and execution of our performance obligations . as part of this process , management reviews information including , but not limited to , any outstanding key contract matters , progress towards completion and the related program schedule , identified risks and opportunities and the related changes in estimates of revenues and costs . the risks and opportunities include management 's judgment about the ability and cost to achieve the schedule , technical requirements , and other contractual requirements . management must make assumptions and estimates regarding labor productivity and availability , the complexity of the work to be performed , the availability of materials , the length of time to complete the performance obligation , execution by our subcontractors , the availability and timing of funding from our customer and overhead cost rates , among other variables . based on this analysis , any adjustments to revenue , operating costs and the related impact to operating income are recognized as necessary in the period they become known . these adjustments may result from positive performance and may result in an increase in operating income during the performance of individual performance obligations if we determine we will be successful

the company utilizes and continues to explore implementing 27 new technologies such as our global web presence , with 22 marketing websites in 23 countries , e-commerce enabled in the united states , canada and japan , and social networking and blogs as cost-effective consumer communication opportunities to increase online and store sales . we believe the growth strategies described above will allow us to deliver long-term superior returns on our investments and drive increased cash flows from operating activities . however , the current macroeconomic environment , while stabilizing , has created a challenging retail market in which consumers , notably in north america and japan , are still cautious . the company believes long-term growth can still be achieved through a combination of expanded distribution , a focus on innovation to support productivity and disciplined expense control . our multi-channel distribution model is diversified and includes substantial international and factory businesses , which reduces our reliance upon our full-price u.s. business . with an essentially debt-free balance sheet and significant cash position , we have a business model that generates significant cash flow and we are in a position to invest in our brand while continuing to return capital to shareholders through common stock repurchases and dividends . fiscal 2012 the key metrics of fiscal 2012 were : earnings per diluted share rose 20.9 % to $ 3.53. net sales increased 14.5 % to $ 4.76 billion . direct-to-consumer sales rose 16.1 % to $ 4.23 billion . comparable sales in coach 's north american stores increased 6.6 % . in north america , coach opened 9 net new retail stores and 26 new factory stores , including 16 men 's , bringing the total number of retail and factory stores to 354 and 169 , respectively , at the end of fiscal 2012. we also expanded 10 factory stores in north america . coach china results continued to be strong with double-digit growth in comparable stores . coach china opened 30 net new locations , bringing the total number of locations at the end of fiscal 2012 to 96. coach japan opened 11 net new locations , bringing the total number of locations at the end of fiscal 2012 to 180. in addition , we expanded three locations . the company acquired its domestic retail coach businesses in taiwan and singapore . as the result of these acquisitions and subsequent openings , the company operated 7 retail locations in singapore and 27 in taiwan as of the end of fiscal 2012. the company has assumed direct control of its domestic business in malaysia in july 2012 and its domestic retail business in korea in august 2012. coach 's board increased the company 's cash dividend by 33 % , to an expected annual rate of $ 1.20 per share starting with the dividend paid on july 2 , 2012 . 28 fiscal 2012 compared to fiscal 2011 the following table summarizes results of operations for fiscal 2012 compared to fiscal 2011 : replace_table_token_18_th net sales the following table presents net sales by operating segment for fiscal 2012 compared to fiscal 2011 : replace_table_token_19_th direct-to-consumer — net sales increased 16.1 % to $ 4.23 billion during fiscal 2012 from $ 3.65 billion during fiscal 2011 , driven by sales increases in our company-operated stores in north america and china . comparable store sales measure sales performance at stores that have been open for at least 12 months , and includes sales from coach.com . coach excludes new locations from the comparable store base for the first year of operation . similarly , stores that are expanded by 15 % or more are also excluded from the comparable store base until the first anniversary of their reopening . stores that are closed for renovations are removed from the comparable store base . in north america , net sales increased 12.7 % driven by sales from new and expanded stores and by a 6.6 % increase in comparable store sales . during fiscal 2012 , coach opened 9 net new retail stores and 26 new factory stores , and expanded 10 factory stores in north america . in japan , net sales increased 11.7 % driven by an approximately $ 40.1 million , or 5.3 % , positive impact from foreign currency exchange . during fiscal 2012 , coach opened 11 net new locations and expanded three locations in japan . coach china results continued to be strong with double-digit percentage growth in comparable store sales . during fiscal 2012 , coach opened 30 net new stores in hong kong and mainland china . indirect — net sales increased 3.8 % to $ 531.5 million from $ 512.1 million in fiscal 2011. the increase was driven primarily by a 7.9 % increase in coach international wholesale net revenue , partially offset by a 1.6 % decrease in u.s. wholesale net revenue . licensing revenue of approximately $ 28.5 million and $ 24.7 million in fiscal 2012 and fiscal 2011 , respectively , is included in indirect sales . 29 operating income operating income increased 15.9 % to $ 1.51 billion in fiscal 2012 as compared to $ 1.30 billion in fiscal 2011. excluding items affecting comparability of $ 39.2 million in fiscal 2012 and $ 25.7 million in fiscal 2011 , operating income increased 16.6 % to $ 1.55 billion . operating margin increased to 31.7 % as compared to 31.4 % in the prior year , as gross margin increased while selling , general , and administrative ( “sg & a” ) expenses decreased as a percentage of sales . story_separator_special_tag we believe these non-gaap measures are useful to investors in evaluating the company 's ongoing operating and financial results and understanding how such results compare with the company 's historical performance . in addition , we believe excluding the items affecting comparability assists investors in developing expectations of future performance . these items affecting comparability do not represent the company 's direct , ongoing business operations . by providing the non-gaap measures , as a supplement to gaap information , we believe we are enhancing investors ' understanding of our business and our results of operations . the non-gaap financial measures are limited in their usefulness and should be considered in addition to , and not in lieu of , u.s. gaap financial measures . further , these non-gaap measures may be unique to the company , as they may be different from non-gaap measures used by other companies . 34 the year-over-year comparisons of our financial results are affected by the following items included in our reported results : replace_table_token_22_th fiscal 2012 items charitable contributions and tax adjustments during fiscal 2012 , the company decreased the provision for income taxes by $ 23.9 million , primarily as a result of recording the effect of a revaluation of certain deferred tax asset balances due to a change in japan 's corporate tax laws and the favorable settlement of a multi-year transfer pricing agreement with japan . the company used the net income favorability to contribute an aggregate $ 39.2 million to the coach foundation . the company believed that in order to reflect the direct results of the normal , ongoing business operations , both the tax adjustments and the resulting coach foundation funding needed to be adjusted . this exclusion is consistent with the way management views its results and is the basis on which incentive compensation was calculated for fiscal 2012. fiscal 2011 items charitable contributions and tax adjustments during the third quarter of fiscal 2011 , the company decreased the provision for income taxes by $ 15.5 million , primarily as a result of a favorable settlement of a multi-year tax return examination . the company used the net income favorability to contribute $ 20.9 million to the coach foundation and 400 million yen or $ 4.8 million to the japanese red cross society . the company believed that in order to reflect the direct results of the normal , ongoing business operations , both the tax adjustments and the resulting coach foundation funding and japanese red cross society contribution needed to be adjusted . this exclusion is consistent with the way management views its results and is the basis on which incentive compensation was calculated and paid for fiscal 2011 . 35 fiscal 2009 items cost savings measures during the third quarter of fiscal 2009 , the company recorded a charge of $ 13.4 million , related to cost savings initiatives . these initiatives included the elimination of approximately 150 positions from the company 's corporate offices in new york , new jersey and jacksonville , the closure of four underperforming retail stores and the closure of coach europe services , the company 's sample-making facility in italy . prior to these cost savings measures in fiscal 2009 , the company had no recent past history of similar elimination of positions , closure of facilities , or closure of underperforming stores during the stores ' lease terms . charitable contribution and tax adjustments during the fourth quarter of fiscal 2009 , the company decreased the provision for income taxes by $ 18.8 million , primarily as a result of a favorable settlement of a multi-year tax return examination and other tax accounting adjustments . the underlying events and circumstances for the tax settlement and adjustments were not related to the fiscal 2008 settlement . the company used the net income favorability to contribute $ 15.0 million to the coach foundation . the company believed that in order to reflect the direct results of the normal , ongoing business operations , both the tax adjustments and the resulting foundation funding needed to be adjusted . this exclusion is consistent with the way management views its results and is the basis on which incentive compensation was calculated and paid for fiscal 2009. fiscal 2008 items charitable contribution and tax adjustments during the fourth quarter of fiscal 2008 , the company decreased the provision for income taxes by $ 60.6 million , primarily as a result of a favorable settlement of a tax return examination . the underlying events and circumstances for the tax settlement were not related to the fiscal 2009 settlement . the company used the net income favorability to create the coach foundation . the company recorded an initial contribution to the coach foundation in the amount of $ 20.0 million . the company believed that in order to reflect the direct results of the business operations as was done for executive management incentive compensation , both the tax adjustments and the resulting foundation funding needed to be adjusted . variable expenses as a result of the lower income tax provision , the company incurred additional incentive compensation expense of $ 12.1 million , as a portion of the company 's incentive compensation plan is based on net income and earnings per share . incremental incentive compensation driven by tax settlements of this magnitude is unlikely to recur in the near future as the company has modified its incentive compensation plans during fiscal 2009 to be measured exclusive of any unusual accounting adjustments . the company believes excluding these variable expenses , which were directly linked to the tax settlements , assists investors in evaluating the company 's direct , ongoing business operations . currency fluctuation effects the percentage increase in sales and u.s. dollar increases in operating expenses in fiscal 2012 and fiscal 2011 for coach japan have been presented both including and excluding currency fluctuation effects from translating these foreign-denominated amounts into u.s. dollars

cash flow net cash provided by operating activities was $ 1.22 billion in fiscal 2012 compared to $ 1.03 billion in fiscal 2011. the increase of $ 188.4 million was primarily due to the $ 158.1 million increase in net income as well as the result of working capital changes between the two fiscal years , the most significant of which 36 occurred in inventories , accrued liabilities and other liabilities . increases in inventory balances in fiscal 2012 resulted in the use of cash of $ 71.7 million as compared to $ 64.7 million in fiscal 2011 , primarily due to the company 's international expansion . changes during the year in accrued liabilities balances provided cash of $ 84.2 million in fiscal 2012 , compared to $ 53.7 million in fiscal 2011 , driven primarily by the timing of certain expenses and tax payments . changes in other liabilities balances resulted in a use of cash of $ 17.6 million in fiscal 2012 compared to a cash source of $ 13.4 million in fiscal 2011 , primarily due to the timing of certain cash payments . net cash used in investing activities was $ 259.4 million in fiscal 2012 compared to $ 59.6 million in fiscal 2011 , with the increase of $ 199.8 million largely driven by acquisitions , higher planned capital investment , and the timing of cash investments . during fiscal 2012 , the company acquired 100 % of its domestic retail businesses in singapore and taiwan from the former distributors for an aggregate $ 53.2 million , net of cash acquired .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```cash flow net cash provided by operating activities was $ 1.22 billion in fiscal 2012 compared to $ 1.03 billion in fiscal 2011. the increase of $ 188.4 million was primarily due to the $ 158.1 million increase in net income as well as the result of working capital changes between the two fiscal years , the most significant of which 36 occurred in inventories , accrued liabilities and other liabilities . increases in inventory balances in fiscal 2012 resulted in the use of cash of $ 71.7 million as compared to $ 64.7 million in fiscal 2011 , primarily due to the company 's international expansion . changes during the year in accrued liabilities balances provided cash of $ 84.2 million in fiscal 2012 , compared to $ 53.7 million in fiscal 2011 , driven primarily by the timing of certain expenses and tax payments . changes in other liabilities balances resulted in a use of cash of $ 17.6 million in fiscal 2012 compared to a cash source of $ 13.4 million in fiscal 2011 , primarily due to the timing of certain cash payments . net cash used in investing activities was $ 259.4 million in fiscal 2012 compared to $ 59.6 million in fiscal 2011 , with the increase of $ 199.8 million largely driven by acquisitions , higher planned capital investment , and the timing of cash investments . during fiscal 2012 , the company acquired 100 % of its domestic retail businesses in singapore and taiwan from the former distributors for an aggregate $ 53.2 million , net of cash acquired . ``` Suspicious Activity Report : the company utilizes and continues to explore implementing 27 new technologies such as our global web presence , with 22 marketing websites in 23 countries , e-commerce enabled in the united states , canada and japan , and social networking and blogs as cost-effective consumer communication opportunities to increase online and store sales . we believe the growth strategies described above will allow us to deliver long-term superior returns on our investments and drive increased cash flows from operating activities . however , the current macroeconomic environment , while stabilizing , has created a challenging retail market in which consumers , notably in north america and japan , are still cautious . the company believes long-term growth can still be achieved through a combination of expanded distribution , a focus on innovation to support productivity and disciplined expense control . our multi-channel distribution model is diversified and includes substantial international and factory businesses , which reduces our reliance upon our full-price u.s. business . with an essentially debt-free balance sheet and significant cash position , we have a business model that generates significant cash flow and we are in a position to invest in our brand while continuing to return capital to shareholders through common stock repurchases and dividends . fiscal 2012 the key metrics of fiscal 2012 were : earnings per diluted share rose 20.9 % to $ 3.53. net sales increased 14.5 % to $ 4.76 billion . direct-to-consumer sales rose 16.1 % to $ 4.23 billion . comparable sales in coach 's north american stores increased 6.6 % . in north america , coach opened 9 net new retail stores and 26 new factory stores , including 16 men 's , bringing the total number of retail and factory stores to 354 and 169 , respectively , at the end of fiscal 2012. we also expanded 10 factory stores in north america . coach china results continued to be strong with double-digit growth in comparable stores . coach china opened 30 net new locations , bringing the total number of locations at the end of fiscal 2012 to 96. coach japan opened 11 net new locations , bringing the total number of locations at the end of fiscal 2012 to 180. in addition , we expanded three locations . the company acquired its domestic retail coach businesses in taiwan and singapore . as the result of these acquisitions and subsequent openings , the company operated 7 retail locations in singapore and 27 in taiwan as of the end of fiscal 2012. the company has assumed direct control of its domestic business in malaysia in july 2012 and its domestic retail business in korea in august 2012. coach 's board increased the company 's cash dividend by 33 % , to an expected annual rate of $ 1.20 per share starting with the dividend paid on july 2 , 2012 . 28 fiscal 2012 compared to fiscal 2011 the following table summarizes results of operations for fiscal 2012 compared to fiscal 2011 : replace_table_token_18_th net sales the following table presents net sales by operating segment for fiscal 2012 compared to fiscal 2011 : replace_table_token_19_th direct-to-consumer — net sales increased 16.1 % to $ 4.23 billion during fiscal 2012 from $ 3.65 billion during fiscal 2011 , driven by sales increases in our company-operated stores in north america and china . comparable store sales measure sales performance at stores that have been open for at least 12 months , and includes sales from coach.com . coach excludes new locations from the comparable store base for the first year of operation . similarly , stores that are expanded by 15 % or more are also excluded from the comparable store base until the first anniversary of their reopening . stores that are closed for renovations are removed from the comparable store base . in north america , net sales increased 12.7 % driven by sales from new and expanded stores and by a 6.6 % increase in comparable store sales . during fiscal 2012 , coach opened 9 net new retail stores and 26 new factory stores , and expanded 10 factory stores in north america . in japan , net sales increased 11.7 % driven by an approximately $ 40.1 million , or 5.3 % , positive impact from foreign currency exchange . during fiscal 2012 , coach opened 11 net new locations and expanded three locations in japan . coach china results continued to be strong with double-digit percentage growth in comparable store sales . during fiscal 2012 , coach opened 30 net new stores in hong kong and mainland china . indirect — net sales increased 3.8 % to $ 531.5 million from $ 512.1 million in fiscal 2011. the increase was driven primarily by a 7.9 % increase in coach international wholesale net revenue , partially offset by a 1.6 % decrease in u.s. wholesale net revenue . licensing revenue of approximately $ 28.5 million and $ 24.7 million in fiscal 2012 and fiscal 2011 , respectively , is included in indirect sales . 29 operating income operating income increased 15.9 % to $ 1.51 billion in fiscal 2012 as compared to $ 1.30 billion in fiscal 2011. excluding items affecting comparability of $ 39.2 million in fiscal 2012 and $ 25.7 million in fiscal 2011 , operating income increased 16.6 % to $ 1.55 billion . operating margin increased to 31.7 % as compared to 31.4 % in the prior year , as gross margin increased while selling , general , and administrative ( “sg & a” ) expenses decreased as a percentage of sales . story_separator_special_tag we believe these non-gaap measures are useful to investors in evaluating the company 's ongoing operating and financial results and understanding how such results compare with the company 's historical performance . in addition , we believe excluding the items affecting comparability assists investors in developing expectations of future performance . these items affecting comparability do not represent the company 's direct , ongoing business operations . by providing the non-gaap measures , as a supplement to gaap information , we believe we are enhancing investors ' understanding of our business and our results of operations . the non-gaap financial measures are limited in their usefulness and should be considered in addition to , and not in lieu of , u.s. gaap financial measures . further , these non-gaap measures may be unique to the company , as they may be different from non-gaap measures used by other companies . 34 the year-over-year comparisons of our financial results are affected by the following items included in our reported results : replace_table_token_22_th fiscal 2012 items charitable contributions and tax adjustments during fiscal 2012 , the company decreased the provision for income taxes by $ 23.9 million , primarily as a result of recording the effect of a revaluation of certain deferred tax asset balances due to a change in japan 's corporate tax laws and the favorable settlement of a multi-year transfer pricing agreement with japan . the company used the net income favorability to contribute an aggregate $ 39.2 million to the coach foundation . the company believed that in order to reflect the direct results of the normal , ongoing business operations , both the tax adjustments and the resulting coach foundation funding needed to be adjusted . this exclusion is consistent with the way management views its results and is the basis on which incentive compensation was calculated for fiscal 2012. fiscal 2011 items charitable contributions and tax adjustments during the third quarter of fiscal 2011 , the company decreased the provision for income taxes by $ 15.5 million , primarily as a result of a favorable settlement of a multi-year tax return examination . the company used the net income favorability to contribute $ 20.9 million to the coach foundation and 400 million yen or $ 4.8 million to the japanese red cross society . the company believed that in order to reflect the direct results of the normal , ongoing business operations , both the tax adjustments and the resulting coach foundation funding and japanese red cross society contribution needed to be adjusted . this exclusion is consistent with the way management views its results and is the basis on which incentive compensation was calculated and paid for fiscal 2011 . 35 fiscal 2009 items cost savings measures during the third quarter of fiscal 2009 , the company recorded a charge of $ 13.4 million , related to cost savings initiatives . these initiatives included the elimination of approximately 150 positions from the company 's corporate offices in new york , new jersey and jacksonville , the closure of four underperforming retail stores and the closure of coach europe services , the company 's sample-making facility in italy . prior to these cost savings measures in fiscal 2009 , the company had no recent past history of similar elimination of positions , closure of facilities , or closure of underperforming stores during the stores ' lease terms . charitable contribution and tax adjustments during the fourth quarter of fiscal 2009 , the company decreased the provision for income taxes by $ 18.8 million , primarily as a result of a favorable settlement of a multi-year tax return examination and other tax accounting adjustments . the underlying events and circumstances for the tax settlement and adjustments were not related to the fiscal 2008 settlement . the company used the net income favorability to contribute $ 15.0 million to the coach foundation . the company believed that in order to reflect the direct results of the normal , ongoing business operations , both the tax adjustments and the resulting foundation funding needed to be adjusted . this exclusion is consistent with the way management views its results and is the basis on which incentive compensation was calculated and paid for fiscal 2009. fiscal 2008 items charitable contribution and tax adjustments during the fourth quarter of fiscal 2008 , the company decreased the provision for income taxes by $ 60.6 million , primarily as a result of a favorable settlement of a tax return examination . the underlying events and circumstances for the tax settlement were not related to the fiscal 2009 settlement . the company used the net income favorability to create the coach foundation . the company recorded an initial contribution to the coach foundation in the amount of $ 20.0 million . the company believed that in order to reflect the direct results of the business operations as was done for executive management incentive compensation , both the tax adjustments and the resulting foundation funding needed to be adjusted . variable expenses as a result of the lower income tax provision , the company incurred additional incentive compensation expense of $ 12.1 million , as a portion of the company 's incentive compensation plan is based on net income and earnings per share . incremental incentive compensation driven by tax settlements of this magnitude is unlikely to recur in the near future as the company has modified its incentive compensation plans during fiscal 2009 to be measured exclusive of any unusual accounting adjustments . the company believes excluding these variable expenses , which were directly linked to the tax settlements , assists investors in evaluating the company 's direct , ongoing business operations . currency fluctuation effects the percentage increase in sales and u.s. dollar increases in operating expenses in fiscal 2012 and fiscal 2011 for coach japan have been presented both including and excluding currency fluctuation effects from translating these foreign-denominated amounts into u.s. dollars

on july 31 , 2017 , jaguar animal health , inc. , or jaguar , completed a merger with napo pursuant to the agreement and plan of merger dated march 31 , 2017 by and among jaguar , napo , napo acquisition corporation ( `` merger sub `` ) , and napo 's representative ( the `` merger agreement `` ) . in accordance with the terms of the merger agreement , upon the completion of the merger , merger sub merged with and into napo , with napo surviving as our wholly-owned subsidiary . immediately following the napo merger , jaguar changed its name from `` jaguar animal health , inc. `` to `` jaguar health , inc. `` napo now operates 80 as a wholly-owned subsidiary of jaguar focused on human health and the ongoing commercialization of mytesi , a napo drug product approved by the u.s. fda for the symptomatic relief of noninfectious diarrhea in adults with hiv/aids on antiretroviral therapy . on a consolidated basis , we have not yet generated enough revenue to date to achieve break even or positive cash flow , and we expect to continue to incur significant research and development and other expenses . our net loss and comprehensive loss was $ 22.0 million and $ 14.7 million for the years ended december 31 , 2017 and 2016 , respectively . as of december 31 , 2017 , we had total stockholders ' equity of $ 17.3 million and cash and cash equivalents of $ 520,698. we expect to continue to incur losses for the foreseeable future as we expand our product development activities , seek necessary approvals for our product candidates , conduct species-specific formulation studies for our non-prescription products , establish api manufacturing capabilities and begin commercialization activities . as a result , we expect to experience increased expenditures for 2018. revenue recognition we recognize revenue in accordance with asc 605 `` revenue recognition `` , subtopic asc 605-25 `` revenue with multiple element arrangements `` and subtopic asc 605-28 `` revenue recognition—milestone method `` , which provides accounting guidance for revenue recognition for arrangements with multiple deliverables and guidance on defining the milestone and determining when the use of the milestone method of revenue recognition for research and development transactions is appropriate , respectively . for multiple-element arrangements , each deliverable within a multiple deliverable revenue arrangement is accounted for as a separate unit of accounting if both of the following criteria are met : ( 1 ) the delivered item or items have value to the customer on a standalone basis and ( 2 ) for an arrangement that includes a general right of return relative to the delivered item ( s ) , delivery or performance of the undelivered item ( s ) is considered probable and substantially in our control . if a deliverable in a multiple element arrangement is not deemed to have a stand-alone value , consideration received for such a deliverable is recognized ratably over the term of the arrangement or the estimated performance period , and it will be periodically reviewed based on the progress of the related product development plan . the effect of a change made to an estimated performance period and therefore revenue recognized ratably would occur on a prospective basis in the period that the change was made . we recognize revenue under its licensing , development , co-promotion and commercialization agreement from milestone payments when : ( i ) the milestone event is substantive and its achievability has substantive uncertainty at the inception of the agreement , and ( ii ) it does not have ongoing performance obligations related to the achievement of the milestone earned . milestone payments are considered substantive if all of the following conditions are met : the milestone payment ( a ) is commensurate with either our performance subsequent to the inception of the arrangement to achieve the milestone or the enhancement of the value of the delivered item or items as a result of a specific outcome resulting from our performance subsequent to the inception of the arrangement to achieve the milestone , ( b ) relates solely to past performance , and ( c ) is reasonable relative to all of the deliverables and payment terms ( including other potential milestone consideration ) within the arrangement . we record revenue related to the reimbursement of costs incurred under the collaboration agreement where the company acts as principal , controls the research and development activities and bears credit risk . under the agreement , we are reimbursed for associated out-of-pocket costs and for certain employee costs . the gross amount of these pass-through costs is reported in revenue in the accompanying statements of operations and comprehensive loss , while the actual expense for which we are reimbursed are reflected as research and development costs . determining whether and when some of these revenue recognition criteria have been satisfied often involves assumptions and judgments that can have a significant impact on the timing and amount of revenue we will report . changes in assumptions or judgments or changes to the elements in an 81 arrangement could cause a material increase or decrease in the amount of revenue that we report in a particular period . product revenue sales of neonorm calf and foal to distributors are made under agreements that may provide distributor price adjustments and rights of return under certain circumstances . beginning the three months ended december 2017 , we developed sufficient sales history and pipeline visibility to recognize revenue when risk and title of products are transferred to the distributors . story_separator_special_tag option grants year over year . other expenses , consisting primarily of consulting and formulation expenses , decreased $ 697,224 from $ 1,710,793 in the year ended december 31 , 2016 to $ 1,013,569 in the same period in 2017. consulting expenses decreased $ 540,559 from $ 1,047,285 in the year ended december 31 , 2016 to $ 506,726 in the same period in 2017 consistent with the decrease in contractor utilization to assist in our clinical trials and in chemistry , manufacturing and controls ( `` cmc `` ) activities . formulation expenses decreased $ 154,180 from $ 420,143 in the year ended december 31 , 2016 to $ 265,963 for the same period in 2017 due to an decrease in work needed for clinical operations . we plan to increase our research and development expense as we continue developing our drug candidates . our research and development expenses include $ 1,014,820 of napo research and development expenses for the five month period from the july 31 , 2017 acquisition . we continued to increase our level of support for the reforestation of croton lechleri trees in south america , which is reflected in an increase in spend of $ 134,616 from $ 113,393 in the year ended december 31 , 2016 to $ 248,010 in the same period in 2017. we value and take to heart the responsibility to replenish trees consumed in order to extract the raw material to manufacture our primary commercial product and the drug product for use in clinical trials . 87 sales and marketing expense the following table presents the components of sales and marketing expense for the years ended december 31 , 2017 and 2016 together with the change in such components in dollars and as a percentage : replace_table_token_4_th our sales and marketing expense increased $ 2,598,299 from $ 485,440 in the year ended december 31 , 2016 to $ 3,083,739 in the same period in 2017. personnel and related benefits increased $ 555,844 from $ 198,100 in the year ended december 31 , 2016 to $ 753,944 in the same period in 2017 due to headcount changes year over year , net of $ 42,703 in employee leasing chargebacks to napo for services rendered in the seven months ended july 31 , 2017 over the year ended december 31 , 2016. stock based compensation expense decreased $ 41,354 from $ 73,679 in the year ended december 31 , 2016 to $ 32,325 in the same period in 2017 due to new options granted at a much lower fair value due to a lower strike price and a lower fair market value . direct marketing and sales expense increased $ 1,375,452 from $ 116,417 in the year ended december 31 , 2016 to $ 1,491,869 for the same period in 2017 due to an increase in marketing programs to promote the napo mytesi product . other expenses , consisted primarily of travel expense , consulting expense and royalty expense , which collectively increased $ 708,357 from $ 97,244 in the year ended december 31 , 2016 to $ 805,601 in the same period in 2017. we plan to expand sales and marketing spend to promote our mytesi products . sales and marketing expenses include $ 2,519,701 in napo sales and marketing expenses for the five month period from the july 31 , 2017 acquisition . general and administrative expense the following table presents the components of general and administrative expense for the years ended december 31 , 2017 and 2016 together with the change in such components in dollars and as a percentage : replace_table_token_5_th 88 our general and administrative expenses increased $ 5,264,409 from $ 5,983,238 in the year ended december 31 , 2016 to $ 11,247,647 for the same period in 2017 due primarily to $ 3,521,751 in merger related expenses incurred in the year ended december 31 , 2017 , including $ 858,103 in consulting services for a fairness opinion , $ 101,119 in other consulting services , $ 2,202,799 in estimated legal fees and $ 136,529 in estimated audit fees , and $ 223,201 in estimated printer and filing fees . personnel and related benefits decreased $ 294,677 from $ 2,104,809 in the year ended december 31 , 2016 to $ 1,810,132 in the same period in 2017 due to an increase of $ 60,232 in employee leasing chargebacks for services rendered in the seven months ended july 31 , 2017 versus the year ended december 31 , 2016 , a decrease in severance expense of $ 105,425 from $ 105,425 in the year ended december 31 , 2016 to $ 0 in the same period in 2017 , with the remainder of the decrease due to changes in headcount personnel and related salaries year over year , primarily at high paying executive levels . personnel and related benefits for the year ended december 31 , 2017 include $ 321,313 for napo 's personnel and related benefits for the five months from the july 31 , 2017 date of acquisition . stock-based compensation increased $ 102,597 from $ 462,759 in the year ended december 31 , 2016 to $ 565,356 in the same period in 2017 due primarily to expense associated with new grants to existing employees . public company expenses increased $ 486,376 from $ 291,253 in the year ended december 31 , 2016 to $ 777,629 in the same period in 2017 due primarily to the $ 223,201 in merger related printer expenses . in addition to the $ 136,529 of audit related merger fees discussed above , our annual , quarterly and other audit and accounting fees increased by another $ 292,737 resulting in an aggregate $ 429,266 increase in accounting fees from $ 311,693 in the year ended december 31 , 2016 to $ 740,959 in the same period in 2017. in addition to the $ 2,202,799 of legal related merger fees , our general corporate and public securities legal fees increased an

cash used in operating activities during the year ended december 31 , 2017 , cash used in operating activities of $ 9,824,940 resulted from our net loss of $ 22.0 million , adjusted by non-cash accretion of end of term payment , debt discounts and debt issuance costs of $ 600,000 , stock-based compensation of $ 815,000 , change in fair value of modified warrants of $ 23,000 , reduction in the fair value of warrant liability of $ 695,000 , loss on extinguishment of debt of $ 477,000 , stock issued in the merger in exchange for services $ 151,000 , common stock issued in exchange for services rendered of $ 44,000 , depreciation and amortization expenses of $ 584,000 , interest paid on the conversion of debt to equity of $ 79,000 , impairment of goodwill of $ 16.8 million , impairment of long-lived intangible assets of $ 2,300,000 deferred income benefit of $ 13.2 million , and gain on revaluation of derivative liability of $ 9,000 , net of changes in operating assets and liabilities of $ 4.1 million . during the year ended december 31 , 2016 , cash used in operating activities of $ 14.4 million resulted from our net loss of $ 14.7 million , offset by non-cash accretion of end of term payment , debt discounts and debt issuance costs of $ 510,000 , stock-based compensation of $ 718,000 , loss on extinguishment of debt of $ 108,000 , depreciation expense of $ 47,000 , net of changes in operating assets and liabilities of $ 1.1 million . 93 cash provided by/used in investing activities during the year ended december 31 , 2017 , cash used in investing activities of $ 1,285,215 consisted of cash used in acquisition , net of cash acquired of $ 1.6 million offset by $ 272,000 of release of restricted cash that resulted from principal payments of our long-term debt .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```cash used in operating activities during the year ended december 31 , 2017 , cash used in operating activities of $ 9,824,940 resulted from our net loss of $ 22.0 million , adjusted by non-cash accretion of end of term payment , debt discounts and debt issuance costs of $ 600,000 , stock-based compensation of $ 815,000 , change in fair value of modified warrants of $ 23,000 , reduction in the fair value of warrant liability of $ 695,000 , loss on extinguishment of debt of $ 477,000 , stock issued in the merger in exchange for services $ 151,000 , common stock issued in exchange for services rendered of $ 44,000 , depreciation and amortization expenses of $ 584,000 , interest paid on the conversion of debt to equity of $ 79,000 , impairment of goodwill of $ 16.8 million , impairment of long-lived intangible assets of $ 2,300,000 deferred income benefit of $ 13.2 million , and gain on revaluation of derivative liability of $ 9,000 , net of changes in operating assets and liabilities of $ 4.1 million . during the year ended december 31 , 2016 , cash used in operating activities of $ 14.4 million resulted from our net loss of $ 14.7 million , offset by non-cash accretion of end of term payment , debt discounts and debt issuance costs of $ 510,000 , stock-based compensation of $ 718,000 , loss on extinguishment of debt of $ 108,000 , depreciation expense of $ 47,000 , net of changes in operating assets and liabilities of $ 1.1 million . 93 cash provided by/used in investing activities during the year ended december 31 , 2017 , cash used in investing activities of $ 1,285,215 consisted of cash used in acquisition , net of cash acquired of $ 1.6 million offset by $ 272,000 of release of restricted cash that resulted from principal payments of our long-term debt . ``` Suspicious Activity Report : on july 31 , 2017 , jaguar animal health , inc. , or jaguar , completed a merger with napo pursuant to the agreement and plan of merger dated march 31 , 2017 by and among jaguar , napo , napo acquisition corporation ( `` merger sub `` ) , and napo 's representative ( the `` merger agreement `` ) . in accordance with the terms of the merger agreement , upon the completion of the merger , merger sub merged with and into napo , with napo surviving as our wholly-owned subsidiary . immediately following the napo merger , jaguar changed its name from `` jaguar animal health , inc. `` to `` jaguar health , inc. `` napo now operates 80 as a wholly-owned subsidiary of jaguar focused on human health and the ongoing commercialization of mytesi , a napo drug product approved by the u.s. fda for the symptomatic relief of noninfectious diarrhea in adults with hiv/aids on antiretroviral therapy . on a consolidated basis , we have not yet generated enough revenue to date to achieve break even or positive cash flow , and we expect to continue to incur significant research and development and other expenses . our net loss and comprehensive loss was $ 22.0 million and $ 14.7 million for the years ended december 31 , 2017 and 2016 , respectively . as of december 31 , 2017 , we had total stockholders ' equity of $ 17.3 million and cash and cash equivalents of $ 520,698. we expect to continue to incur losses for the foreseeable future as we expand our product development activities , seek necessary approvals for our product candidates , conduct species-specific formulation studies for our non-prescription products , establish api manufacturing capabilities and begin commercialization activities . as a result , we expect to experience increased expenditures for 2018. revenue recognition we recognize revenue in accordance with asc 605 `` revenue recognition `` , subtopic asc 605-25 `` revenue with multiple element arrangements `` and subtopic asc 605-28 `` revenue recognition—milestone method `` , which provides accounting guidance for revenue recognition for arrangements with multiple deliverables and guidance on defining the milestone and determining when the use of the milestone method of revenue recognition for research and development transactions is appropriate , respectively . for multiple-element arrangements , each deliverable within a multiple deliverable revenue arrangement is accounted for as a separate unit of accounting if both of the following criteria are met : ( 1 ) the delivered item or items have value to the customer on a standalone basis and ( 2 ) for an arrangement that includes a general right of return relative to the delivered item ( s ) , delivery or performance of the undelivered item ( s ) is considered probable and substantially in our control . if a deliverable in a multiple element arrangement is not deemed to have a stand-alone value , consideration received for such a deliverable is recognized ratably over the term of the arrangement or the estimated performance period , and it will be periodically reviewed based on the progress of the related product development plan . the effect of a change made to an estimated performance period and therefore revenue recognized ratably would occur on a prospective basis in the period that the change was made . we recognize revenue under its licensing , development , co-promotion and commercialization agreement from milestone payments when : ( i ) the milestone event is substantive and its achievability has substantive uncertainty at the inception of the agreement , and ( ii ) it does not have ongoing performance obligations related to the achievement of the milestone earned . milestone payments are considered substantive if all of the following conditions are met : the milestone payment ( a ) is commensurate with either our performance subsequent to the inception of the arrangement to achieve the milestone or the enhancement of the value of the delivered item or items as a result of a specific outcome resulting from our performance subsequent to the inception of the arrangement to achieve the milestone , ( b ) relates solely to past performance , and ( c ) is reasonable relative to all of the deliverables and payment terms ( including other potential milestone consideration ) within the arrangement . we record revenue related to the reimbursement of costs incurred under the collaboration agreement where the company acts as principal , controls the research and development activities and bears credit risk . under the agreement , we are reimbursed for associated out-of-pocket costs and for certain employee costs . the gross amount of these pass-through costs is reported in revenue in the accompanying statements of operations and comprehensive loss , while the actual expense for which we are reimbursed are reflected as research and development costs . determining whether and when some of these revenue recognition criteria have been satisfied often involves assumptions and judgments that can have a significant impact on the timing and amount of revenue we will report . changes in assumptions or judgments or changes to the elements in an 81 arrangement could cause a material increase or decrease in the amount of revenue that we report in a particular period . product revenue sales of neonorm calf and foal to distributors are made under agreements that may provide distributor price adjustments and rights of return under certain circumstances . beginning the three months ended december 2017 , we developed sufficient sales history and pipeline visibility to recognize revenue when risk and title of products are transferred to the distributors . story_separator_special_tag option grants year over year . other expenses , consisting primarily of consulting and formulation expenses , decreased $ 697,224 from $ 1,710,793 in the year ended december 31 , 2016 to $ 1,013,569 in the same period in 2017. consulting expenses decreased $ 540,559 from $ 1,047,285 in the year ended december 31 , 2016 to $ 506,726 in the same period in 2017 consistent with the decrease in contractor utilization to assist in our clinical trials and in chemistry , manufacturing and controls ( `` cmc `` ) activities . formulation expenses decreased $ 154,180 from $ 420,143 in the year ended december 31 , 2016 to $ 265,963 for the same period in 2017 due to an decrease in work needed for clinical operations . we plan to increase our research and development expense as we continue developing our drug candidates . our research and development expenses include $ 1,014,820 of napo research and development expenses for the five month period from the july 31 , 2017 acquisition . we continued to increase our level of support for the reforestation of croton lechleri trees in south america , which is reflected in an increase in spend of $ 134,616 from $ 113,393 in the year ended december 31 , 2016 to $ 248,010 in the same period in 2017. we value and take to heart the responsibility to replenish trees consumed in order to extract the raw material to manufacture our primary commercial product and the drug product for use in clinical trials . 87 sales and marketing expense the following table presents the components of sales and marketing expense for the years ended december 31 , 2017 and 2016 together with the change in such components in dollars and as a percentage : replace_table_token_4_th our sales and marketing expense increased $ 2,598,299 from $ 485,440 in the year ended december 31 , 2016 to $ 3,083,739 in the same period in 2017. personnel and related benefits increased $ 555,844 from $ 198,100 in the year ended december 31 , 2016 to $ 753,944 in the same period in 2017 due to headcount changes year over year , net of $ 42,703 in employee leasing chargebacks to napo for services rendered in the seven months ended july 31 , 2017 over the year ended december 31 , 2016. stock based compensation expense decreased $ 41,354 from $ 73,679 in the year ended december 31 , 2016 to $ 32,325 in the same period in 2017 due to new options granted at a much lower fair value due to a lower strike price and a lower fair market value . direct marketing and sales expense increased $ 1,375,452 from $ 116,417 in the year ended december 31 , 2016 to $ 1,491,869 for the same period in 2017 due to an increase in marketing programs to promote the napo mytesi product . other expenses , consisted primarily of travel expense , consulting expense and royalty expense , which collectively increased $ 708,357 from $ 97,244 in the year ended december 31 , 2016 to $ 805,601 in the same period in 2017. we plan to expand sales and marketing spend to promote our mytesi products . sales and marketing expenses include $ 2,519,701 in napo sales and marketing expenses for the five month period from the july 31 , 2017 acquisition . general and administrative expense the following table presents the components of general and administrative expense for the years ended december 31 , 2017 and 2016 together with the change in such components in dollars and as a percentage : replace_table_token_5_th 88 our general and administrative expenses increased $ 5,264,409 from $ 5,983,238 in the year ended december 31 , 2016 to $ 11,247,647 for the same period in 2017 due primarily to $ 3,521,751 in merger related expenses incurred in the year ended december 31 , 2017 , including $ 858,103 in consulting services for a fairness opinion , $ 101,119 in other consulting services , $ 2,202,799 in estimated legal fees and $ 136,529 in estimated audit fees , and $ 223,201 in estimated printer and filing fees . personnel and related benefits decreased $ 294,677 from $ 2,104,809 in the year ended december 31 , 2016 to $ 1,810,132 in the same period in 2017 due to an increase of $ 60,232 in employee leasing chargebacks for services rendered in the seven months ended july 31 , 2017 versus the year ended december 31 , 2016 , a decrease in severance expense of $ 105,425 from $ 105,425 in the year ended december 31 , 2016 to $ 0 in the same period in 2017 , with the remainder of the decrease due to changes in headcount personnel and related salaries year over year , primarily at high paying executive levels . personnel and related benefits for the year ended december 31 , 2017 include $ 321,313 for napo 's personnel and related benefits for the five months from the july 31 , 2017 date of acquisition . stock-based compensation increased $ 102,597 from $ 462,759 in the year ended december 31 , 2016 to $ 565,356 in the same period in 2017 due primarily to expense associated with new grants to existing employees . public company expenses increased $ 486,376 from $ 291,253 in the year ended december 31 , 2016 to $ 777,629 in the same period in 2017 due primarily to the $ 223,201 in merger related printer expenses . in addition to the $ 136,529 of audit related merger fees discussed above , our annual , quarterly and other audit and accounting fees increased by another $ 292,737 resulting in an aggregate $ 429,266 increase in accounting fees from $ 311,693 in the year ended december 31 , 2016 to $ 740,959 in the same period in 2017. in addition to the $ 2,202,799 of legal related merger fees , our general corporate and public securities legal fees increased an

immediately after acquiring ntelos , we exchanged spectrum licenses valued at $ 198.2 million , and customer based contract rights valued at $ 206.7 million , acquired from ntelos with sprint , and received an expansion of our affiliate service territory to include most of the service area served by ntelos , valued at $ 284.1 million , as well as customer based contract rights , valued at $ 120.9 million , relating to ntelos ' and sprint 's legacy customers in the our affiliate service territory . the value of the affiliate agreement expansion is based on changes to the amended affiliate agreement that include an increase in the price to be paid by sprint from 80 % to 90 % of the entire business value of pcs if the affiliate agreement is not renewed and an extension of the affiliate agreement with sprint by five years to 2029. also included in the value is the expanded territory in the ntelos service area and the accompanying right to serve all future sprint customers in the expanded territory , our commitment to upgrade certain coverage and capacity in the newly acquired service area , the waiver of a portion of the management fee charged by sprint , as well as other items defined in the amended affiliate agreement . 38 the company expects to incur a total of approximately $ 90 million of integration and acquisition expenses associated with this transaction , excluding approximately $ 23.0 million of debt issuance costs . in connection with the acquisition , the company also chose to proactively migrate former ntelos customers to devices that can interact with the sprint billing and network systems . expected costs also include the ntelos back office staff and support functions until the ntelos legacy customers are migrated to the sprint billing platform ; cost of the handsets to be provided to ntelos legacy customers as they migrate to the sprint billing platform ; severance costs for back office and other former ntelos employees who will not be retained permanently ; and transaction related fees . we have incurred $ 54.7 million of these costs in the year ended december 31 , 2016. these costs include $ 1.3 million reflected in cost of goods and services and $ 11.1 million reflected in selling , general and administrative costs in the year ended december 31 , 2016. critical accounting policies the company relies on the use of estimates and makes assumptions that affect its financial condition and operating results . these estimates and assumptions are based on historical results and trends as well as the company 's forecasts as to how these might change in the future . the most critical accounting policies that materially affect the company 's results of operations include the following : revenue recognition the company recognizes revenue when persuasive evidence of an arrangement exists , services have been rendered or products have been delivered , the price to the buyer is fixed and determinable and collectability is reasonably assured . revenues are recognized by the company based on the various types of transactions generating the revenue . for services , revenue is recognized as the services are performed . for equipment sales , revenue is recognized when the sales transaction is complete . under the sprint management agreement , postpaid wireless service revenues are reported net of an 8 % management fee and an 8.6 % net service fee , retained by sprint . prepaid wireless service revenues are reported net of a 6 % management fee retained by sprint . under our amended affiliate agreement , sprint agreed to waive the management fee , which is historically presented as a contra-revenue by us , for a period of approximately six years . the impact of sprint 's waiver of the management fee over the approximate six-year period is reflected as an increase in revenue , offset by the non-cash adjustment to recognize this impact on a straight-line basis over the remaining initial contract term of approximately 14 years . allowance for doubtful accounts estimates are used in determining the allowance for doubtful accounts and are based on historical collection and write-off experience , current trends , credit policies , and the analysis of the accounts receivable by aging category . in determining these estimates , the company compares historical write-offs in relation to the estimated period in which the subscriber was originally billed . the company also looks at the historical average length of time that elapses between the original billing date and the date of write-off and the financial position of its larger customers in determining the adequacy of the allowance for doubtful accounts . from this information , the company assigns specific amounts to be applied against the outstanding receivables . the company does not carry an allowance for receivables related to sprint pcs customers . in accordance with the terms of the affiliate contract with sprint , the company receives payment from sprint for the monthly net billings to pcs customers in weekly installments over the following four or five weeks . inventories the company 's inventories consist primarily of items held for resale such as devices and accessories . the company values its inventory at the lower of cost or market . inventory cost is computed on an average cost basis . market value is determined by reviewing current replacement cost , marketability and obsolescence . income taxes income taxes are accounted for under the asset and liability method . deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between financial statement carrying amounts of existing assets and liabilities and their respective tax bases . deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled . story_separator_special_tag replace_table_token_10_th 44 service revenues replace_table_token_11_th ( 1 ) postpaid net billings are defined under the terms of the affiliate contract with sprint to be the gross billings to customers within our service territory less billing credits and adjustments and allocated write-offs of uncollectible accounts . operating revenues wireless service revenue increased $ 167.0 million , or 86.6 % , in 2016 over 2015 , primarily due to the ntelos acquisition . net postpaid billings increased $ 129.4 million , or 69.9 % , as average subscribers increased 89.2 % and average billing rates dropped by 11 % primarily due to new customers and upgrading existing customers moving to lower cost service plans that do n't include a subsidized phone . net prepaid billings increased $ 31.6 million , or 61.8 % , due to 53.1 % growth in average prepaid subscribers over 2015 and higher average revenue per subscriber due to improvements in product mix . effective january 1 , 2016 , the fees retained by sprint , and deducted from postpaid revenues , decreased from 22.0 % to 16.6 % , and certain revenue and expense items became settled separately . as a result , despite the growth in net postpaid billings , the net service fee dropped by $ 2.9 million or 11.4 % . travel and other revenues , now separately settled , increased $ 17.1 million . tower lease revenue increased primarily as a result of amendments to existing leases , as third party co-locators add 4g capabilities to our towers , and rents associated with the towers acquired in the ntelos acquisition . equipment revenue increased due primarily to separately settled national device revenues passed to us by sprint , as well as expanded activity due to the ntelos acquisition . operating expenses cost of goods and services increased $ 69.5 million , or 109.4 % , in 2016 from 2015. postpaid handset costs decreased $ 0.6 million . prepaid handset costs increased $ 4.3 million . network costs increased $ 47.5 million , while maintenance costs increased $ 8.7 million . these increases are primarily attributable to the expanded activities and service territory as a result of the ntelos acquisition . separately settled national handset costs added $ 4.6 million to 2016 's cost of goods and services . selling , general and administrative costs increased $ 60.1 million , or 167.8 % , in 2016 over 2015. national channel sales commissions , which we began separately settling with sprint effective january 1 , 2016 , added $ 22.4 million to the current year expense . expenses associated with prepaid wireless programs increased $ 3.5 million in 2016 from 2015. personnel costs increased $ 20.9 million due to the addition of new retail stores and the need to support the ntelos billing platform and sales and 45 customer service activities for customers prior to migration . advertising expenses increased $ 5.5 million , while property taxes increased $ 1.8 million , both due to the ntelos acquisition . acquisition , integration and migration costs of $ 25.9 million included $ 18.3 million in handset costs for customers to migrate to the sprint back office and billing platform , $ 4.9 million in costs to shutdown overlapping cell sites and replace older backhaul circuits with ethernet circuits to support increased data volumes at upgraded sites , and $ 2.7 million in incremental staff to support migration efforts in the stores . depreciation and amortization increased $ 73.2 million , or 212.7 % , in 2016 over 2015 , reflecting the tangible and intangible assets acquired in the ntelos acquisition . cable the cable segment provides video , internet and voice services in franchise areas in portions of virginia , west virginia and western maryland , and leases fiber optic facilities throughout its service area . it does not include video , internet and voice services provided to customers in shenandoah county , virginia , which are included in the wireline segment . on january 1 , 2016 , we acquired the assets of colane cable company . with the acquisition , we received 3,299 video customers , 1,405 high-speed internet customers , and 302 voice customers . these customers are included in the december 31 , 2016 totals shown below . the following table shows selected operating statistics of the cable segment as of the dates shown : replace_table_token_12_th 1 ) homes and businesses are considered passed ( “ homes passed ” ) if we can connect them to our distribution system without further extending the transmission lines . homes passed is an estimate based upon the best available information . 2 ) customer relationships represent the number of customers who receive at least one of our services . 3 ) generally , a dwelling or commercial unit with one or more television sets connected to our distribution system counts as one video customer . where services are provided on a bulk basis , such as to hotels and some multi-dwelling units , the revenue charged to the customer is divided by the rate for comparable service in the local market to determine the number of customer equivalents included in the customer counts shown above . during the first quarter of 2016 , we 46 modified the way we count subscribers when a commercial customer upgrades its internet service via a fiber contract . we retroactively applied the new count methodology to prior periods , and applied similar logic to certain bulk customers ; the net result was reductions in internet subscriber counts of 559 and 673 subscribers to december 31 , 2015 , and december 31 , 2014 totals , respectively . 4 ) penetration is calculated by dividing the number of customers by the number of homes passed or available homes , as appropriate . 5 ) digital video penetration is calculated by dividing the number of digital video customers by total video customers . digital video customers are video customers who receive

sources and uses of cash . the company generated $ 161.5 million of net cash from operations in 2016 , an increase from $ 119.3 million in 2015 , which was a $ 4.3 million increase from 2014. the increases were primarily due to increases in operating income before depreciation and amortization . during 2016 , the company utilized $ 820.0 million in net investing activities , including $ 657.4 million invested in acquisitions of ntelos and colane . plant and equipment purchases in 2016 , 2015 and 2014 totaled $ 173.2 million , $ 69.7 million and $ 68.2 million , respectively . capital expenditures in 2016 primarily supported wireless network upgrades and capacity and coverage enhancements as a result of the ntelos acquisition , as well as retail store remodeling , cable segment extensions and investment in customer premises equipment , and expansion and upgrade of our fiber networks . capital expenditures in 2015 supported projects across all segments , including wireless network capacity and coverage enhancements , new retail stores , cable segment extensions and investment in customer premises equipment , and expansion and upgrade of our fiber networks . expenditures in 2014 also supported projects across all segments , including wireless network capacity and coverage enhancements , cable plant expansion and upgrades , and wireline fiber builds . financing activities provided $ 617.9 million in 2016 as the company borrowed $ 860 million to fund the ntelos acquisition and related activities , repaid debt totaling $ 213.8 million , and paid $ 14.9 million to enter into the new debt financing arrangement to acquire ntelos . the company also paid cash dividends totaling $ 11.7 million . financing activities utilized $ 42.2 million in 2015 as the company made $ 23.0 million in principal payments on long-term debt , paid cash dividends totaling $ 11.1 million and paid $ 7.9 million in debt issuance fees related to the pending ntelos acquisition .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```sources and uses of cash . the company generated $ 161.5 million of net cash from operations in 2016 , an increase from $ 119.3 million in 2015 , which was a $ 4.3 million increase from 2014. the increases were primarily due to increases in operating income before depreciation and amortization . during 2016 , the company utilized $ 820.0 million in net investing activities , including $ 657.4 million invested in acquisitions of ntelos and colane . plant and equipment purchases in 2016 , 2015 and 2014 totaled $ 173.2 million , $ 69.7 million and $ 68.2 million , respectively . capital expenditures in 2016 primarily supported wireless network upgrades and capacity and coverage enhancements as a result of the ntelos acquisition , as well as retail store remodeling , cable segment extensions and investment in customer premises equipment , and expansion and upgrade of our fiber networks . capital expenditures in 2015 supported projects across all segments , including wireless network capacity and coverage enhancements , new retail stores , cable segment extensions and investment in customer premises equipment , and expansion and upgrade of our fiber networks . expenditures in 2014 also supported projects across all segments , including wireless network capacity and coverage enhancements , cable plant expansion and upgrades , and wireline fiber builds . financing activities provided $ 617.9 million in 2016 as the company borrowed $ 860 million to fund the ntelos acquisition and related activities , repaid debt totaling $ 213.8 million , and paid $ 14.9 million to enter into the new debt financing arrangement to acquire ntelos . the company also paid cash dividends totaling $ 11.7 million . financing activities utilized $ 42.2 million in 2015 as the company made $ 23.0 million in principal payments on long-term debt , paid cash dividends totaling $ 11.1 million and paid $ 7.9 million in debt issuance fees related to the pending ntelos acquisition . ``` Suspicious Activity Report : immediately after acquiring ntelos , we exchanged spectrum licenses valued at $ 198.2 million , and customer based contract rights valued at $ 206.7 million , acquired from ntelos with sprint , and received an expansion of our affiliate service territory to include most of the service area served by ntelos , valued at $ 284.1 million , as well as customer based contract rights , valued at $ 120.9 million , relating to ntelos ' and sprint 's legacy customers in the our affiliate service territory . the value of the affiliate agreement expansion is based on changes to the amended affiliate agreement that include an increase in the price to be paid by sprint from 80 % to 90 % of the entire business value of pcs if the affiliate agreement is not renewed and an extension of the affiliate agreement with sprint by five years to 2029. also included in the value is the expanded territory in the ntelos service area and the accompanying right to serve all future sprint customers in the expanded territory , our commitment to upgrade certain coverage and capacity in the newly acquired service area , the waiver of a portion of the management fee charged by sprint , as well as other items defined in the amended affiliate agreement . 38 the company expects to incur a total of approximately $ 90 million of integration and acquisition expenses associated with this transaction , excluding approximately $ 23.0 million of debt issuance costs . in connection with the acquisition , the company also chose to proactively migrate former ntelos customers to devices that can interact with the sprint billing and network systems . expected costs also include the ntelos back office staff and support functions until the ntelos legacy customers are migrated to the sprint billing platform ; cost of the handsets to be provided to ntelos legacy customers as they migrate to the sprint billing platform ; severance costs for back office and other former ntelos employees who will not be retained permanently ; and transaction related fees . we have incurred $ 54.7 million of these costs in the year ended december 31 , 2016. these costs include $ 1.3 million reflected in cost of goods and services and $ 11.1 million reflected in selling , general and administrative costs in the year ended december 31 , 2016. critical accounting policies the company relies on the use of estimates and makes assumptions that affect its financial condition and operating results . these estimates and assumptions are based on historical results and trends as well as the company 's forecasts as to how these might change in the future . the most critical accounting policies that materially affect the company 's results of operations include the following : revenue recognition the company recognizes revenue when persuasive evidence of an arrangement exists , services have been rendered or products have been delivered , the price to the buyer is fixed and determinable and collectability is reasonably assured . revenues are recognized by the company based on the various types of transactions generating the revenue . for services , revenue is recognized as the services are performed . for equipment sales , revenue is recognized when the sales transaction is complete . under the sprint management agreement , postpaid wireless service revenues are reported net of an 8 % management fee and an 8.6 % net service fee , retained by sprint . prepaid wireless service revenues are reported net of a 6 % management fee retained by sprint . under our amended affiliate agreement , sprint agreed to waive the management fee , which is historically presented as a contra-revenue by us , for a period of approximately six years . the impact of sprint 's waiver of the management fee over the approximate six-year period is reflected as an increase in revenue , offset by the non-cash adjustment to recognize this impact on a straight-line basis over the remaining initial contract term of approximately 14 years . allowance for doubtful accounts estimates are used in determining the allowance for doubtful accounts and are based on historical collection and write-off experience , current trends , credit policies , and the analysis of the accounts receivable by aging category . in determining these estimates , the company compares historical write-offs in relation to the estimated period in which the subscriber was originally billed . the company also looks at the historical average length of time that elapses between the original billing date and the date of write-off and the financial position of its larger customers in determining the adequacy of the allowance for doubtful accounts . from this information , the company assigns specific amounts to be applied against the outstanding receivables . the company does not carry an allowance for receivables related to sprint pcs customers . in accordance with the terms of the affiliate contract with sprint , the company receives payment from sprint for the monthly net billings to pcs customers in weekly installments over the following four or five weeks . inventories the company 's inventories consist primarily of items held for resale such as devices and accessories . the company values its inventory at the lower of cost or market . inventory cost is computed on an average cost basis . market value is determined by reviewing current replacement cost , marketability and obsolescence . income taxes income taxes are accounted for under the asset and liability method . deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between financial statement carrying amounts of existing assets and liabilities and their respective tax bases . deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled . story_separator_special_tag replace_table_token_10_th 44 service revenues replace_table_token_11_th ( 1 ) postpaid net billings are defined under the terms of the affiliate contract with sprint to be the gross billings to customers within our service territory less billing credits and adjustments and allocated write-offs of uncollectible accounts . operating revenues wireless service revenue increased $ 167.0 million , or 86.6 % , in 2016 over 2015 , primarily due to the ntelos acquisition . net postpaid billings increased $ 129.4 million , or 69.9 % , as average subscribers increased 89.2 % and average billing rates dropped by 11 % primarily due to new customers and upgrading existing customers moving to lower cost service plans that do n't include a subsidized phone . net prepaid billings increased $ 31.6 million , or 61.8 % , due to 53.1 % growth in average prepaid subscribers over 2015 and higher average revenue per subscriber due to improvements in product mix . effective january 1 , 2016 , the fees retained by sprint , and deducted from postpaid revenues , decreased from 22.0 % to 16.6 % , and certain revenue and expense items became settled separately . as a result , despite the growth in net postpaid billings , the net service fee dropped by $ 2.9 million or 11.4 % . travel and other revenues , now separately settled , increased $ 17.1 million . tower lease revenue increased primarily as a result of amendments to existing leases , as third party co-locators add 4g capabilities to our towers , and rents associated with the towers acquired in the ntelos acquisition . equipment revenue increased due primarily to separately settled national device revenues passed to us by sprint , as well as expanded activity due to the ntelos acquisition . operating expenses cost of goods and services increased $ 69.5 million , or 109.4 % , in 2016 from 2015. postpaid handset costs decreased $ 0.6 million . prepaid handset costs increased $ 4.3 million . network costs increased $ 47.5 million , while maintenance costs increased $ 8.7 million . these increases are primarily attributable to the expanded activities and service territory as a result of the ntelos acquisition . separately settled national handset costs added $ 4.6 million to 2016 's cost of goods and services . selling , general and administrative costs increased $ 60.1 million , or 167.8 % , in 2016 over 2015. national channel sales commissions , which we began separately settling with sprint effective january 1 , 2016 , added $ 22.4 million to the current year expense . expenses associated with prepaid wireless programs increased $ 3.5 million in 2016 from 2015. personnel costs increased $ 20.9 million due to the addition of new retail stores and the need to support the ntelos billing platform and sales and 45 customer service activities for customers prior to migration . advertising expenses increased $ 5.5 million , while property taxes increased $ 1.8 million , both due to the ntelos acquisition . acquisition , integration and migration costs of $ 25.9 million included $ 18.3 million in handset costs for customers to migrate to the sprint back office and billing platform , $ 4.9 million in costs to shutdown overlapping cell sites and replace older backhaul circuits with ethernet circuits to support increased data volumes at upgraded sites , and $ 2.7 million in incremental staff to support migration efforts in the stores . depreciation and amortization increased $ 73.2 million , or 212.7 % , in 2016 over 2015 , reflecting the tangible and intangible assets acquired in the ntelos acquisition . cable the cable segment provides video , internet and voice services in franchise areas in portions of virginia , west virginia and western maryland , and leases fiber optic facilities throughout its service area . it does not include video , internet and voice services provided to customers in shenandoah county , virginia , which are included in the wireline segment . on january 1 , 2016 , we acquired the assets of colane cable company . with the acquisition , we received 3,299 video customers , 1,405 high-speed internet customers , and 302 voice customers . these customers are included in the december 31 , 2016 totals shown below . the following table shows selected operating statistics of the cable segment as of the dates shown : replace_table_token_12_th 1 ) homes and businesses are considered passed ( “ homes passed ” ) if we can connect them to our distribution system without further extending the transmission lines . homes passed is an estimate based upon the best available information . 2 ) customer relationships represent the number of customers who receive at least one of our services . 3 ) generally , a dwelling or commercial unit with one or more television sets connected to our distribution system counts as one video customer . where services are provided on a bulk basis , such as to hotels and some multi-dwelling units , the revenue charged to the customer is divided by the rate for comparable service in the local market to determine the number of customer equivalents included in the customer counts shown above . during the first quarter of 2016 , we 46 modified the way we count subscribers when a commercial customer upgrades its internet service via a fiber contract . we retroactively applied the new count methodology to prior periods , and applied similar logic to certain bulk customers ; the net result was reductions in internet subscriber counts of 559 and 673 subscribers to december 31 , 2015 , and december 31 , 2014 totals , respectively . 4 ) penetration is calculated by dividing the number of customers by the number of homes passed or available homes , as appropriate . 5 ) digital video penetration is calculated by dividing the number of digital video customers by total video customers . digital video customers are video customers who receive

our forticasb extends the core capabilities of our security fabric architecture to provide businesses the same level of cybersecurity and threat intelligence in cloud environments as they do on their physical networks . the fortinet cloud security is available across all major cloud providers , including microsoft azure , amazon web services , google cloud , ibm cloud and oracle cloud . fourth , the emergence of the iot has created an environment where data move freely between devices across locations , network environments , remote offices , mobile workers and public cloud environments , making it difficult to consistently track and secure . financial highlights we recorded total revenue of $ 1.49 billion in 2017 , an increase of 17 % compared to $ 1.28 billion in 2016 . product revenue was $ 577.2 million in 2017 , an increase of 5 % compared to $ 548.1 million in 2016 . service revenue was $ 917.8 million in 2017 , an increase of 26 % compared to $ 727.3 million in 2016 . we generated operating income of $ 109.8 million in 2017 , an increase of 156 % compared to $ 42.9 million in 2016. cash , cash equivalents and investments were $ 1.35 billion as of december 31 , 2017 , an increase of $ 38.8 million , or 3 % , from december 31 , 2016 . deferred revenue was $ 1.34 billion as of december 31 , 2017 , an increase of $ 301.0 million , or 29 % , from december 31 , 2016 . we generated cash flows from operating activities of $ 594.4 million in 2017 , an increase of $ 248.7 million , or 72 % , compared to 2016 . in 2017 , we repurchased 11.2 million shares of common stock under the repurchase program for an aggregate purchase price of $ 446.3 million . in 2016 , we repurchased 3.9 million shares of common stock for a total purchase price of $ 110.8 million . our revenue growth was driven by the strength in sales of our fortigate and non-fortigate products and the sale of new , and the renewal and upgrade of existing , forticare technical support and fortiguard security subscription service contracts . revenue grew in 2017 as the investment made in sales and marketing enabled us to continue to gain enterprise customers . 42 we continue to see a shift in our revenue mix from product revenues to higher-margin , recurring service revenues , reflecting our success in driving higher-priced subscription bundles and services . on a geographic basis , revenue continues to be diversified globally , which remains a key strength of our business . the percentage of our fortigate-related billings from high-end products increased from 38 % in 2016 to 39 % in 2017 , and the percentage of our fortigate-related billings from mid-range products increased from 28 % in 2016 to 30 % in 2017. the percentage of our fortigate-related billings from entry-level products decreased to 31 % in 2017 from 34 % in 2016. the sale of non-fortigate products also grew significantly in 2017. we also saw more deals that included multiple fortinet products in physical , virtual and cloud environments . in 2017 , operating expenses as a percentage of revenue decreased by 3 percentage points compared to 2016 . the decrease was primarily driven by a reduction in sales and marketing expenses as a percentage of revenue . headcount increased by 9 % to 5,066 employees and contractors as of december 31 , 2017 , up from 4,665 as of december 31 , 2016. business model our sales strategy is based on a distribution model whereby we primarily sell our products , software licenses and services directly to distributors which sell to resellers and service providers , which , in turn , sell to our end-customers . in certain cases , we sell directly to large service providers and major systems integrators . we also offer our products across all major cloud providers , including amazon web services , microsoft azure , google cloud , ibm cloud and oracle cloud . while the revenue from such sales are still relatively insignificant , they have increased significantly in recent periods on a percentage basis . typically , fortiguard security subscription and forticare technical support services are purchased along with our hardware products and software licenses , most frequently as part of a bundle offering that includes hardware and services functionality . we generally invoice at the time of our sale for the total price of the products and security and technical support services , and the invoice is payable within 30 to 90 days . we also invoice certain licenses and services on a monthly basis . we generally recognize product revenue up front , and recognize revenue for the sale of new and the renewal of existing fortiguard security subscription and forticare technical support services contracts ratably over the term of the service contract . we recognize revenue for certain software licenses up front as product revenue and , to a lesser extent , recognize other software licenses over the term of the agreement as services revenue . we recognize the security and support revenue over the service period , which is typically one to three years , to a lesser extent , five years . sales of new and renewal services are a source of recurring revenue and increase our deferred revenue balance , which has contributed to our positive cash flow from operations . we recognize commissions on both product and service sales at the time of sale . our approach to network security is defined by our spu hardware architecture . the spu includes three lines of proprietary asics , content processor , network processor and the system on a chip . the asics are designed for highly efficient execution of computationally intensive tasks , including policy enforcement , threat detection and encryption . story_separator_special_tag security services provide access to our antivirus , intrusion prevention , web filtering , and anti-spam functionality . support services include rights to unspecified software upgrades , maintenance releases and patches , telephone and internet access to technical support personnel , and hardware support . service revenue consists of sales from our fortiguard security subscription and forticare technical support services , professional and training services and other services that include saas and iaas , both of which are hosted or cloud-based services . we recognize revenue from these arrangements as the subscription service is delivered over the term , which is typically one year , or on a monthly usage basis . to date , saas and iaas revenues have not represented a significant percentage of our total revenue . we reduce revenue for estimates of sales returns and allowances and record reductions to revenue for rebates and estimated commitments related to price protection and other customer incentive programs . additionally , in limited circumstances , we may permit end-customers , distributors and resellers to return our products , subject to varying limitations , for a refund within a reasonably short period from the date of purchase . we estimate and record reserves for sales incentives and sales returns based on historical experience . our sales arrangements typically contain multiple elements , such as hardware , security subscription , technical support services and other services . the majority of our hardware appliance products contain our operating system software that together function to deliver the essential functionality of the product . our products and services generally qualify as separate units of accounting . we allocate revenue to each unit of accounting based on an estimated selling price using vendor-specific objective evidence ( “ vsoe ” ) of selling price , if it exists , or third-party evidence ( “ tpe ” ) of selling price . if neither vsoe nor tpe of selling price exists for a deliverable , we use our best estimate of selling price ( “ besp ” ) for that deliverable . revenue allocated to each element is then recognized when the basic revenue recognition criteria are met for each element . revenue is reported net of sales taxes . for our hardware appliances , we use besp as our selling price estimate . for our support and other services , we generally use vsoe as our selling price estimate . we determine vsoe of fair value for elements of an arrangement based on the historical pricing and discounting practices for those services when sold separately . in establishing vsoe , we require that a substantial majority of the selling prices for a service fall within a reasonably narrow pricing range , generally evidenced by a substantial majority of such historical stand-alone transactions falling within a reasonably narrow range as a percentage of list price . when we are unable to establish a selling price using vsoe for our support and other services , we use besp in our allocation of arrangement consideration . we determine besp for a product or service by considering multiple historical factors including , but not limited to , cost of products , gross margin objectives , pricing practices , geographies , customer classes and distribution channels that fall within a reasonably narrow range as a percentage of list price . for multiple-element arrangements where software deliverables are included , revenue is allocated to the non-software deliverables and to the software deliverables as a group using the relative estimated selling prices of each of the deliverables in the arrangement based on the estimated selling price hierarchy . the amount allocated to the software deliverables is then allocated to each software deliverable using the residual method when vsoe of fair value exists . if evidence of vsoe of fair value of one or more undelivered elements does not exist , all software allocated revenue is deferred and recognized when delivery of those elements occurs or when fair value can be established . when the undelivered element for which we do not have vsoe of fair value is support , revenue for the entire arrangement is recognized ratably over the support period . the same residual method and vsoe of fair value principles apply for our multiple element arrangements that contain only software elements . 48 asu 2014-09 on january 1 , 2018 , we adopted accounting standards update ( “ asu ” ) 2014-09—revenue from contracts with customers , which outlines a single , comprehensive model for entities to use in accounting for revenue arising from contracts with customers . the core principle of asu 2014-09 is to recognize revenue when promised goods or services are transferred to customers in an amount that reflects the consideration that is expected to be received for those goods or services . asu 2014-09 defines a five-step process to achieve this core principle and , accordingly , we expect more judgment and estimates may be required within the revenue recognition process than is required under the legacy gaap , including identifying performance obligations in the contract , estimating the amount of variable consideration to include in the transaction price and allocating the transaction price to each separate performance obligation . asu 2014-09 permits two methods of adoption : retrospectively to each prior reporting period presented ( the full retrospective method ) , or retrospectively with the cumulative effect of initially applying the guidance recognized at the date of initial application ( the modified retrospective method ) . we elected to adopt asu 2014-09 using the modified retrospective method and will apply the standard to contracts that are not completed as of january 1 , 2018 , and will recognize the cumulative effect of initially applying the standard as an adjustment to the opening balance of accumulated deficit . we have completed our analysis of open revenue contracts as of january 1 , 2018. based on our assessment , the impact on revenue in our consolidated financial statements

liquidity and capital resources replace_table_token_23_th liquidity and capital resources may be impacted by our operating activities , as well as by our stock repurchases , real estate and other capital expenditures , proceeds associated with stock option exercises and issuances of common stock under our espp , payment of taxes in connection with the net settlement of equity awards and business acquisitions . in recent years , we have received significant capital resources as a result of increases in our deferred revenue and the proceeds from exercise of stock options and purchases under our espp . additional increases in deferred revenue may depend on a number of factors including our billing growth rate , service contract renewal rates and length of initial and renewals service contracts . we expect proceeds from the issuance of stock options in future years to be impacted by the increased mix of restricted stock units granted versus stock options and also to vary based on our share price . as of december 31 , 2017 , $ 442.8 million remained available for future share repurchase under the repurchase program . we currently expect to spend $ 90.0 million to $ 120.0 million for 2018 in capital expenditures , primarily related to expansion of our offices to support worldwide growth . as of december 31 , 2017 , our cash , cash equivalents and investments of $ 1.35 billion were invested primarily in corporate debt securities , money market fund , certificate of deposits , commercial paper and u.s. government and agency securities . it is our investment policy to invest excess cash in a manner that preserves capital , provides liquidity and maximizes return without significantly increasing risk . as of december 31 , 2017 , $ 848.0 million of our cash and investments were held by our international subsidiaries .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```liquidity and capital resources replace_table_token_23_th liquidity and capital resources may be impacted by our operating activities , as well as by our stock repurchases , real estate and other capital expenditures , proceeds associated with stock option exercises and issuances of common stock under our espp , payment of taxes in connection with the net settlement of equity awards and business acquisitions . in recent years , we have received significant capital resources as a result of increases in our deferred revenue and the proceeds from exercise of stock options and purchases under our espp . additional increases in deferred revenue may depend on a number of factors including our billing growth rate , service contract renewal rates and length of initial and renewals service contracts . we expect proceeds from the issuance of stock options in future years to be impacted by the increased mix of restricted stock units granted versus stock options and also to vary based on our share price . as of december 31 , 2017 , $ 442.8 million remained available for future share repurchase under the repurchase program . we currently expect to spend $ 90.0 million to $ 120.0 million for 2018 in capital expenditures , primarily related to expansion of our offices to support worldwide growth . as of december 31 , 2017 , our cash , cash equivalents and investments of $ 1.35 billion were invested primarily in corporate debt securities , money market fund , certificate of deposits , commercial paper and u.s. government and agency securities . it is our investment policy to invest excess cash in a manner that preserves capital , provides liquidity and maximizes return without significantly increasing risk . as of december 31 , 2017 , $ 848.0 million of our cash and investments were held by our international subsidiaries . ``` Suspicious Activity Report : our forticasb extends the core capabilities of our security fabric architecture to provide businesses the same level of cybersecurity and threat intelligence in cloud environments as they do on their physical networks . the fortinet cloud security is available across all major cloud providers , including microsoft azure , amazon web services , google cloud , ibm cloud and oracle cloud . fourth , the emergence of the iot has created an environment where data move freely between devices across locations , network environments , remote offices , mobile workers and public cloud environments , making it difficult to consistently track and secure . financial highlights we recorded total revenue of $ 1.49 billion in 2017 , an increase of 17 % compared to $ 1.28 billion in 2016 . product revenue was $ 577.2 million in 2017 , an increase of 5 % compared to $ 548.1 million in 2016 . service revenue was $ 917.8 million in 2017 , an increase of 26 % compared to $ 727.3 million in 2016 . we generated operating income of $ 109.8 million in 2017 , an increase of 156 % compared to $ 42.9 million in 2016. cash , cash equivalents and investments were $ 1.35 billion as of december 31 , 2017 , an increase of $ 38.8 million , or 3 % , from december 31 , 2016 . deferred revenue was $ 1.34 billion as of december 31 , 2017 , an increase of $ 301.0 million , or 29 % , from december 31 , 2016 . we generated cash flows from operating activities of $ 594.4 million in 2017 , an increase of $ 248.7 million , or 72 % , compared to 2016 . in 2017 , we repurchased 11.2 million shares of common stock under the repurchase program for an aggregate purchase price of $ 446.3 million . in 2016 , we repurchased 3.9 million shares of common stock for a total purchase price of $ 110.8 million . our revenue growth was driven by the strength in sales of our fortigate and non-fortigate products and the sale of new , and the renewal and upgrade of existing , forticare technical support and fortiguard security subscription service contracts . revenue grew in 2017 as the investment made in sales and marketing enabled us to continue to gain enterprise customers . 42 we continue to see a shift in our revenue mix from product revenues to higher-margin , recurring service revenues , reflecting our success in driving higher-priced subscription bundles and services . on a geographic basis , revenue continues to be diversified globally , which remains a key strength of our business . the percentage of our fortigate-related billings from high-end products increased from 38 % in 2016 to 39 % in 2017 , and the percentage of our fortigate-related billings from mid-range products increased from 28 % in 2016 to 30 % in 2017. the percentage of our fortigate-related billings from entry-level products decreased to 31 % in 2017 from 34 % in 2016. the sale of non-fortigate products also grew significantly in 2017. we also saw more deals that included multiple fortinet products in physical , virtual and cloud environments . in 2017 , operating expenses as a percentage of revenue decreased by 3 percentage points compared to 2016 . the decrease was primarily driven by a reduction in sales and marketing expenses as a percentage of revenue . headcount increased by 9 % to 5,066 employees and contractors as of december 31 , 2017 , up from 4,665 as of december 31 , 2016. business model our sales strategy is based on a distribution model whereby we primarily sell our products , software licenses and services directly to distributors which sell to resellers and service providers , which , in turn , sell to our end-customers . in certain cases , we sell directly to large service providers and major systems integrators . we also offer our products across all major cloud providers , including amazon web services , microsoft azure , google cloud , ibm cloud and oracle cloud . while the revenue from such sales are still relatively insignificant , they have increased significantly in recent periods on a percentage basis . typically , fortiguard security subscription and forticare technical support services are purchased along with our hardware products and software licenses , most frequently as part of a bundle offering that includes hardware and services functionality . we generally invoice at the time of our sale for the total price of the products and security and technical support services , and the invoice is payable within 30 to 90 days . we also invoice certain licenses and services on a monthly basis . we generally recognize product revenue up front , and recognize revenue for the sale of new and the renewal of existing fortiguard security subscription and forticare technical support services contracts ratably over the term of the service contract . we recognize revenue for certain software licenses up front as product revenue and , to a lesser extent , recognize other software licenses over the term of the agreement as services revenue . we recognize the security and support revenue over the service period , which is typically one to three years , to a lesser extent , five years . sales of new and renewal services are a source of recurring revenue and increase our deferred revenue balance , which has contributed to our positive cash flow from operations . we recognize commissions on both product and service sales at the time of sale . our approach to network security is defined by our spu hardware architecture . the spu includes three lines of proprietary asics , content processor , network processor and the system on a chip . the asics are designed for highly efficient execution of computationally intensive tasks , including policy enforcement , threat detection and encryption . story_separator_special_tag security services provide access to our antivirus , intrusion prevention , web filtering , and anti-spam functionality . support services include rights to unspecified software upgrades , maintenance releases and patches , telephone and internet access to technical support personnel , and hardware support . service revenue consists of sales from our fortiguard security subscription and forticare technical support services , professional and training services and other services that include saas and iaas , both of which are hosted or cloud-based services . we recognize revenue from these arrangements as the subscription service is delivered over the term , which is typically one year , or on a monthly usage basis . to date , saas and iaas revenues have not represented a significant percentage of our total revenue . we reduce revenue for estimates of sales returns and allowances and record reductions to revenue for rebates and estimated commitments related to price protection and other customer incentive programs . additionally , in limited circumstances , we may permit end-customers , distributors and resellers to return our products , subject to varying limitations , for a refund within a reasonably short period from the date of purchase . we estimate and record reserves for sales incentives and sales returns based on historical experience . our sales arrangements typically contain multiple elements , such as hardware , security subscription , technical support services and other services . the majority of our hardware appliance products contain our operating system software that together function to deliver the essential functionality of the product . our products and services generally qualify as separate units of accounting . we allocate revenue to each unit of accounting based on an estimated selling price using vendor-specific objective evidence ( “ vsoe ” ) of selling price , if it exists , or third-party evidence ( “ tpe ” ) of selling price . if neither vsoe nor tpe of selling price exists for a deliverable , we use our best estimate of selling price ( “ besp ” ) for that deliverable . revenue allocated to each element is then recognized when the basic revenue recognition criteria are met for each element . revenue is reported net of sales taxes . for our hardware appliances , we use besp as our selling price estimate . for our support and other services , we generally use vsoe as our selling price estimate . we determine vsoe of fair value for elements of an arrangement based on the historical pricing and discounting practices for those services when sold separately . in establishing vsoe , we require that a substantial majority of the selling prices for a service fall within a reasonably narrow pricing range , generally evidenced by a substantial majority of such historical stand-alone transactions falling within a reasonably narrow range as a percentage of list price . when we are unable to establish a selling price using vsoe for our support and other services , we use besp in our allocation of arrangement consideration . we determine besp for a product or service by considering multiple historical factors including , but not limited to , cost of products , gross margin objectives , pricing practices , geographies , customer classes and distribution channels that fall within a reasonably narrow range as a percentage of list price . for multiple-element arrangements where software deliverables are included , revenue is allocated to the non-software deliverables and to the software deliverables as a group using the relative estimated selling prices of each of the deliverables in the arrangement based on the estimated selling price hierarchy . the amount allocated to the software deliverables is then allocated to each software deliverable using the residual method when vsoe of fair value exists . if evidence of vsoe of fair value of one or more undelivered elements does not exist , all software allocated revenue is deferred and recognized when delivery of those elements occurs or when fair value can be established . when the undelivered element for which we do not have vsoe of fair value is support , revenue for the entire arrangement is recognized ratably over the support period . the same residual method and vsoe of fair value principles apply for our multiple element arrangements that contain only software elements . 48 asu 2014-09 on january 1 , 2018 , we adopted accounting standards update ( “ asu ” ) 2014-09—revenue from contracts with customers , which outlines a single , comprehensive model for entities to use in accounting for revenue arising from contracts with customers . the core principle of asu 2014-09 is to recognize revenue when promised goods or services are transferred to customers in an amount that reflects the consideration that is expected to be received for those goods or services . asu 2014-09 defines a five-step process to achieve this core principle and , accordingly , we expect more judgment and estimates may be required within the revenue recognition process than is required under the legacy gaap , including identifying performance obligations in the contract , estimating the amount of variable consideration to include in the transaction price and allocating the transaction price to each separate performance obligation . asu 2014-09 permits two methods of adoption : retrospectively to each prior reporting period presented ( the full retrospective method ) , or retrospectively with the cumulative effect of initially applying the guidance recognized at the date of initial application ( the modified retrospective method ) . we elected to adopt asu 2014-09 using the modified retrospective method and will apply the standard to contracts that are not completed as of january 1 , 2018 , and will recognize the cumulative effect of initially applying the standard as an adjustment to the opening balance of accumulated deficit . we have completed our analysis of open revenue contracts as of january 1 , 2018. based on our assessment , the impact on revenue in our consolidated financial statements

the company is under no obligation ( and expressly disclaims any such obligation ) to update or revise any forward-looking statement that may be made from time to time , whether as a result of new information , future developments or otherwise . please review `` part i , item 1a—risk factors `` in this annual report for a discussion of the factors , risks and uncertainties that could affect our future results . our fiscal year consists of 52 or 53 weeks , ending on the friday closest to september 30. for clarity of presentation , we present all periods as if the year ended on september 30. we refer to the fiscal year ended september 30 , 2016 as `` fiscal 2016 `` and the fiscal year ended september 30 , 2017 as `` fiscal 2017 . `` 36 overview we are a leading fully integrated firm positioned to design , build , finance and operate infrastructure assets for governments , businesses and organizations in more than 150 countries . we provide planning , consulting , architectural and engineering design services to commercial and government clients worldwide in major end markets such as transportation , facilities , environmental , energy , water and government markets . we also provide construction services , including building construction and energy , infrastructure and industrial construction . in addition , we provide program and facilities management and maintenance , training , logistics , consulting , technical assistance , and systems integration and information technology services , primarily for agencies of the u.s. government and also for national governments around the world . our business focuses primarily on providing fee-based planning , consulting , architectural and engineering design services and , therefore , our business is labor intensive . we primarily derive income from our ability to generate revenue and collect cash from our clients through the billing of our employees ' time spent on client projects and our ability to manage our costs . aecom capital primarily derives its income from real estate development sales . we report our business through four segments : design and consulting services ( dcs ) , construction services ( cs ) , management services ( ms ) , and aecom capital ( acap ) . such segments are organized by the types of services provided , the differing specialized needs of the respective clients , and how we manage the business . we have aggregated various operating segments into our reportable segments based on their similar characteristics , including similar long-term financial performance , the nature of services provided , internal processes for delivering those services , and types of customers . our dcs segment delivers planning , consulting , architectural and engineering design services to commercial and government clients worldwide in major end markets such as transportation , facilities , environmental , energy , water and government . dcs revenue is primarily derived from fees from services that we provide , as opposed to pass-through costs from subcontractors . our cs segment provides construction services , including building construction and energy , infrastructure and industrial construction , primarily in the americas . cs revenue typically includes a significant amount of pass-through costs from subcontractors . our ms segment provides program and facilities management and maintenance , training , logistics , consulting , technical assistance , and systems integration and information technology services , primarily for agencies of the u.s. government and also for national governments around the world . ms revenue typically includes a significant amount of pass-through costs from subcontractors . our acap segment invests in real estate , public-private partnership ( p3 ) and infrastructure projects . acap typically partners with investors and experienced developers in the united states and europe as co-general partners . in addition , acap may , but is not required to , enter into contracts with our other aecom affiliates to provide design , engineering , construction management , development and operations and maintenance services for acap funded projects . in april 2017 , acap completed a transaction to sell its 50 % equity interest in provost square i llc , an unconsolidated joint venture which invested in a real estate development in new jersey , for $ 133 million , which resulted in net cash proceeds of $ 77 million and a gain of $ 52 million in our fiscal year 2017. accordingly , we begain reporting acap as a separate segment beginning in the third quarter of fiscal 2017. results of operations for acap were not material in prior periods . during the first quarter of fiscal year 2017 , an operation and maintenance related entity previously reported within our cs segment was realigned within our ms segment to reflect present management oversight . accordingly , approximately $ 130 million and $ 137 million of revenue and $ 124 million and 37 $ 130 million of cost of revenue for the years ended september 30 , 2016 and 2015 , respectively , were reclassified to conform to the current period presentation . our revenue is dependent on our ability to attract and retain qualified and productive employees , identify business opportunities , integrate and maximize the value of our recent acquisitions , allocate our labor resources to profitable and high growth markets , secure new contracts and renew existing client agreements . demand for our services is cyclical and may be vulnerable to sudden economic downturns and reductions in government and private industry spending , which may result in clients delaying , curtailing or canceling proposed and existing projects . moreover , as a professional services company , maintaining the high quality of the work generated by our employees is integral to our revenue generation and profitability . our costs consist primarily of the compensation we pay to our employees , including salaries , fringe benefits , the costs of hiring subcontractors , other project-related expenses and sales , general and administrative costs . story_separator_special_tag the impairment evaluation process includes , among other things , making assumptions about variables such as revenue growth rates , profitability , discount rates , and industry market multiples , which are subject to a high degree of judgment . material assumptions used in the impairment analysis included the weighted average cost of capital ( wacc ) percent and terminal growth rates . for example , as of september 30 , 2017 , a 1 % increase in the wacc rate represents a $ 800 million decrease to the fair value of our reporting units . as of september 30 , 2017 , a 1 % decrease in the terminal growth rate represents a $ 400 million decrease to the fair value of our reporting units . pension benefit obligations a number of assumptions are necessary to determine our pension liabilities and net periodic costs . these liabilities and net periodic costs are sensitive to changes in those assumptions . the assumptions include discount rates , long-term rates of return on plan assets and inflation levels limited to the united kingdom and are generally determined based on the current economic environment in each host country at the end of each respective annual reporting period . we evaluate the funded status of each of our retirement plans using these current assumptions and determine the appropriate funding level considering applicable regulatory requirements , tax deductibility , reporting considerations and other factors . based upon current assumptions , we expect to contribute $ 26.8 million to our international plans in fiscal 2018. our required minimum contributions for our u.s. qualified plans are not significant . in addition , we may make additional discretionary contributions . we currently expect to contribute $ 12.7 million to our u.s. plans ( including benefit payments to nonqualified plans and postretirement medical plans ) in fiscal 2018. if the discount rate was reduced by 25 basis points , plan liabilities would increase by approximately $ 82.2 million . if the discount rate and return on plan assets were reduced by 25 basis points , plan expense would decrease by approximately $ 0.1 million and increase by approximately $ 3.4 million , respectively . if inflation increased by 25 basis points , plan liabilities in the united kingdom would increase by approximately $ 42.7 million and plan expense would increase by approximately $ 2.7 million . 43 at each measurement date , all assumptions are reviewed and adjusted as appropriate . with respect to establishing the return on assets assumption , we consider the long term capital market expectations for each asset class held as an investment by the various pension plans . in addition to expected returns for each asset class , we take into account standard deviation of returns and correlation between asset classes . this is necessary in order to generate a distribution of possible returns which reflects diversification of assets . based on this information , a distribution of possible returns is generated based on the plan 's target asset allocation . capital market expectations for determining the long term rate of return on assets are based on forward-looking assumptions which reflect a 20-year view of the capital markets . in establishing those capital market assumptions and expectations , we rely on the assistance of our actuaries and our investment consultants . we and the plan trustees review whether changes to the various plans ' target asset allocations are appropriate . a change in the plans ' target asset allocations would likely result in a change in the expected return on asset assumptions . in assessing a plan 's asset allocation strategy , we and the plan trustees consider factors such as the structure of the plan 's liabilities , the plan 's funded status , and the impact of the asset allocation to the volatility of the plan 's funded status , so that the overall risk level resulting from our defined benefit plans is appropriate within our risk management strategy . between september 30 , 2016 and september 30 , 2017 , the aggregate worldwide pension deficit decreased from $ 696.1 million to $ 553.0 million due to rising global asset prices . although funding rules are subject to local laws and regulations and vary by location , we expect to reduce this deficit over a period of 7 to 10 years . if the various plans do not experience future investment gains to reduce this shortfall , the deficit will be reduced by additional contributions . accrued professional liability costs we carry professional liability insurance policies or self-insure for our initial layer of professional liability claims under our professional liability insurance policies and for a deductible for each claim even after exceeding the self-insured retention . we accrue for our portion of the estimated ultimate liability for the estimated potential incurred losses . we establish our estimate of loss for each potential claim in consultation with legal counsel handling the specific matters and based on historic trends taking into account recent events . we also use an outside actuarial firm to assist us in estimating our future claims exposure . it is possible that our estimate of loss may be revised based on the actual or revised estimate of liability of the claims . foreign currency translation our functional currency is the u.s. dollar . results of operations for foreign entities are translated to u.s. dollars using the average exchange rates during the period . assets and liabilities for foreign entities are translated using the exchange rates in effect as of the date of the balance sheet . resulting translation adjustments are recorded as a foreign currency translation adjustment into other accumulated comprehensive income/ ( loss ) in stockholders ' equity . we limit exposure to foreign currency fluctuations in most of our contracts through provisions that require client payments in currencies corresponding to the currency in which costs are incurred . as a result of this natural hedge , we generally

cash flows our principal sources of liquidity are cash flows from operations , borrowings under our credit facilities , and access to financial markets . our principal uses of cash are operating expenses , capital expenditures , working capital requirements , acquisitions , and repayment of debt . we believe our anticipated sources of liquidity including operating cash flows , existing cash and cash equivalents , borrowing capacity under our revolving credit facility and our ability to issue debt or equity , if required , will be sufficient to meet our projected cash requirements for at least the next 12 months . generally , we do not provide for u.s. taxes or foreign withholding taxes on gross book-tax basis differences in our non-u.s. subsidiaries because such basis differences are able to and intended to be reinvested indefinitely . determination of the amount of any unrecognized deferred income tax liability on this temporary difference is not practicable because of the complexities of the hypothetical calculation . we have a deferred tax liability in the amount of $ 77.0 million at september 30 , 2017 relating to certain foreign subsidiaries for which the basis difference is not intended to be reinvested indefinitely as part of the liabilities assumed in connection with the acquisition of urs . based on the available sources of cash flows discussed above , we anticipate we will continue to have the ability to permanently reinvest these remaining amounts . at september 30 , 2017 , cash and cash equivalents were $ 802.4 million , an increase of $ 110.3 million , or 15.9 % , from $ 692.1 million at september 30 , 2016. the increase in cash and cash equivalents was primarily attributable to cash provided by operating activities , partially offset by net repayments under our debt agreements , payments for business acquisitions and capital expenditures , net distributions to noncontrolling interest , and investment in unconsolidated joint ventures .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```cash flows our principal sources of liquidity are cash flows from operations , borrowings under our credit facilities , and access to financial markets . our principal uses of cash are operating expenses , capital expenditures , working capital requirements , acquisitions , and repayment of debt . we believe our anticipated sources of liquidity including operating cash flows , existing cash and cash equivalents , borrowing capacity under our revolving credit facility and our ability to issue debt or equity , if required , will be sufficient to meet our projected cash requirements for at least the next 12 months . generally , we do not provide for u.s. taxes or foreign withholding taxes on gross book-tax basis differences in our non-u.s. subsidiaries because such basis differences are able to and intended to be reinvested indefinitely . determination of the amount of any unrecognized deferred income tax liability on this temporary difference is not practicable because of the complexities of the hypothetical calculation . we have a deferred tax liability in the amount of $ 77.0 million at september 30 , 2017 relating to certain foreign subsidiaries for which the basis difference is not intended to be reinvested indefinitely as part of the liabilities assumed in connection with the acquisition of urs . based on the available sources of cash flows discussed above , we anticipate we will continue to have the ability to permanently reinvest these remaining amounts . at september 30 , 2017 , cash and cash equivalents were $ 802.4 million , an increase of $ 110.3 million , or 15.9 % , from $ 692.1 million at september 30 , 2016. the increase in cash and cash equivalents was primarily attributable to cash provided by operating activities , partially offset by net repayments under our debt agreements , payments for business acquisitions and capital expenditures , net distributions to noncontrolling interest , and investment in unconsolidated joint ventures . ``` Suspicious Activity Report : the company is under no obligation ( and expressly disclaims any such obligation ) to update or revise any forward-looking statement that may be made from time to time , whether as a result of new information , future developments or otherwise . please review `` part i , item 1a—risk factors `` in this annual report for a discussion of the factors , risks and uncertainties that could affect our future results . our fiscal year consists of 52 or 53 weeks , ending on the friday closest to september 30. for clarity of presentation , we present all periods as if the year ended on september 30. we refer to the fiscal year ended september 30 , 2016 as `` fiscal 2016 `` and the fiscal year ended september 30 , 2017 as `` fiscal 2017 . `` 36 overview we are a leading fully integrated firm positioned to design , build , finance and operate infrastructure assets for governments , businesses and organizations in more than 150 countries . we provide planning , consulting , architectural and engineering design services to commercial and government clients worldwide in major end markets such as transportation , facilities , environmental , energy , water and government markets . we also provide construction services , including building construction and energy , infrastructure and industrial construction . in addition , we provide program and facilities management and maintenance , training , logistics , consulting , technical assistance , and systems integration and information technology services , primarily for agencies of the u.s. government and also for national governments around the world . our business focuses primarily on providing fee-based planning , consulting , architectural and engineering design services and , therefore , our business is labor intensive . we primarily derive income from our ability to generate revenue and collect cash from our clients through the billing of our employees ' time spent on client projects and our ability to manage our costs . aecom capital primarily derives its income from real estate development sales . we report our business through four segments : design and consulting services ( dcs ) , construction services ( cs ) , management services ( ms ) , and aecom capital ( acap ) . such segments are organized by the types of services provided , the differing specialized needs of the respective clients , and how we manage the business . we have aggregated various operating segments into our reportable segments based on their similar characteristics , including similar long-term financial performance , the nature of services provided , internal processes for delivering those services , and types of customers . our dcs segment delivers planning , consulting , architectural and engineering design services to commercial and government clients worldwide in major end markets such as transportation , facilities , environmental , energy , water and government . dcs revenue is primarily derived from fees from services that we provide , as opposed to pass-through costs from subcontractors . our cs segment provides construction services , including building construction and energy , infrastructure and industrial construction , primarily in the americas . cs revenue typically includes a significant amount of pass-through costs from subcontractors . our ms segment provides program and facilities management and maintenance , training , logistics , consulting , technical assistance , and systems integration and information technology services , primarily for agencies of the u.s. government and also for national governments around the world . ms revenue typically includes a significant amount of pass-through costs from subcontractors . our acap segment invests in real estate , public-private partnership ( p3 ) and infrastructure projects . acap typically partners with investors and experienced developers in the united states and europe as co-general partners . in addition , acap may , but is not required to , enter into contracts with our other aecom affiliates to provide design , engineering , construction management , development and operations and maintenance services for acap funded projects . in april 2017 , acap completed a transaction to sell its 50 % equity interest in provost square i llc , an unconsolidated joint venture which invested in a real estate development in new jersey , for $ 133 million , which resulted in net cash proceeds of $ 77 million and a gain of $ 52 million in our fiscal year 2017. accordingly , we begain reporting acap as a separate segment beginning in the third quarter of fiscal 2017. results of operations for acap were not material in prior periods . during the first quarter of fiscal year 2017 , an operation and maintenance related entity previously reported within our cs segment was realigned within our ms segment to reflect present management oversight . accordingly , approximately $ 130 million and $ 137 million of revenue and $ 124 million and 37 $ 130 million of cost of revenue for the years ended september 30 , 2016 and 2015 , respectively , were reclassified to conform to the current period presentation . our revenue is dependent on our ability to attract and retain qualified and productive employees , identify business opportunities , integrate and maximize the value of our recent acquisitions , allocate our labor resources to profitable and high growth markets , secure new contracts and renew existing client agreements . demand for our services is cyclical and may be vulnerable to sudden economic downturns and reductions in government and private industry spending , which may result in clients delaying , curtailing or canceling proposed and existing projects . moreover , as a professional services company , maintaining the high quality of the work generated by our employees is integral to our revenue generation and profitability . our costs consist primarily of the compensation we pay to our employees , including salaries , fringe benefits , the costs of hiring subcontractors , other project-related expenses and sales , general and administrative costs . story_separator_special_tag the impairment evaluation process includes , among other things , making assumptions about variables such as revenue growth rates , profitability , discount rates , and industry market multiples , which are subject to a high degree of judgment . material assumptions used in the impairment analysis included the weighted average cost of capital ( wacc ) percent and terminal growth rates . for example , as of september 30 , 2017 , a 1 % increase in the wacc rate represents a $ 800 million decrease to the fair value of our reporting units . as of september 30 , 2017 , a 1 % decrease in the terminal growth rate represents a $ 400 million decrease to the fair value of our reporting units . pension benefit obligations a number of assumptions are necessary to determine our pension liabilities and net periodic costs . these liabilities and net periodic costs are sensitive to changes in those assumptions . the assumptions include discount rates , long-term rates of return on plan assets and inflation levels limited to the united kingdom and are generally determined based on the current economic environment in each host country at the end of each respective annual reporting period . we evaluate the funded status of each of our retirement plans using these current assumptions and determine the appropriate funding level considering applicable regulatory requirements , tax deductibility , reporting considerations and other factors . based upon current assumptions , we expect to contribute $ 26.8 million to our international plans in fiscal 2018. our required minimum contributions for our u.s. qualified plans are not significant . in addition , we may make additional discretionary contributions . we currently expect to contribute $ 12.7 million to our u.s. plans ( including benefit payments to nonqualified plans and postretirement medical plans ) in fiscal 2018. if the discount rate was reduced by 25 basis points , plan liabilities would increase by approximately $ 82.2 million . if the discount rate and return on plan assets were reduced by 25 basis points , plan expense would decrease by approximately $ 0.1 million and increase by approximately $ 3.4 million , respectively . if inflation increased by 25 basis points , plan liabilities in the united kingdom would increase by approximately $ 42.7 million and plan expense would increase by approximately $ 2.7 million . 43 at each measurement date , all assumptions are reviewed and adjusted as appropriate . with respect to establishing the return on assets assumption , we consider the long term capital market expectations for each asset class held as an investment by the various pension plans . in addition to expected returns for each asset class , we take into account standard deviation of returns and correlation between asset classes . this is necessary in order to generate a distribution of possible returns which reflects diversification of assets . based on this information , a distribution of possible returns is generated based on the plan 's target asset allocation . capital market expectations for determining the long term rate of return on assets are based on forward-looking assumptions which reflect a 20-year view of the capital markets . in establishing those capital market assumptions and expectations , we rely on the assistance of our actuaries and our investment consultants . we and the plan trustees review whether changes to the various plans ' target asset allocations are appropriate . a change in the plans ' target asset allocations would likely result in a change in the expected return on asset assumptions . in assessing a plan 's asset allocation strategy , we and the plan trustees consider factors such as the structure of the plan 's liabilities , the plan 's funded status , and the impact of the asset allocation to the volatility of the plan 's funded status , so that the overall risk level resulting from our defined benefit plans is appropriate within our risk management strategy . between september 30 , 2016 and september 30 , 2017 , the aggregate worldwide pension deficit decreased from $ 696.1 million to $ 553.0 million due to rising global asset prices . although funding rules are subject to local laws and regulations and vary by location , we expect to reduce this deficit over a period of 7 to 10 years . if the various plans do not experience future investment gains to reduce this shortfall , the deficit will be reduced by additional contributions . accrued professional liability costs we carry professional liability insurance policies or self-insure for our initial layer of professional liability claims under our professional liability insurance policies and for a deductible for each claim even after exceeding the self-insured retention . we accrue for our portion of the estimated ultimate liability for the estimated potential incurred losses . we establish our estimate of loss for each potential claim in consultation with legal counsel handling the specific matters and based on historic trends taking into account recent events . we also use an outside actuarial firm to assist us in estimating our future claims exposure . it is possible that our estimate of loss may be revised based on the actual or revised estimate of liability of the claims . foreign currency translation our functional currency is the u.s. dollar . results of operations for foreign entities are translated to u.s. dollars using the average exchange rates during the period . assets and liabilities for foreign entities are translated using the exchange rates in effect as of the date of the balance sheet . resulting translation adjustments are recorded as a foreign currency translation adjustment into other accumulated comprehensive income/ ( loss ) in stockholders ' equity . we limit exposure to foreign currency fluctuations in most of our contracts through provisions that require client payments in currencies corresponding to the currency in which costs are incurred . as a result of this natural hedge , we generally

service revenue consists of amounts attributable to our fee-based services . reimbursable expenses and non-controlling interests are pass-through items for which we earn no margin . reimbursable expenses consist of amounts we incur on behalf of our customers in performing our fee-based services , but we pass such costs directly on to our customers without any additional markup . non-controlling interests represent the earnings of lenders one , a consolidated entity not owned by altisource , and are included in revenue and reduced from net income to arrive at net income attributable to altisource . we have prepared our consolidated financial statements in accordance with accounting principles generally accepted in the united states of america . altisource 's vision and growth initiatives altisource provides a suite of mortgage , real estate and consumer debt services , leveraging our technology and global operations . our relationship with ocwen provided a foundation on which we built our business and ocwen , as our largest customer , remains an important priority for us . leveraging the services we have built through the ocwen and other relationships , altisource is focused on becoming the premier provider of real estate and mortgage marketplaces offering both distribution and content to a diversified customer base . within the real estate and mortgage markets , we are facilitating transactions related to home sales , home rentals , home maintenance , mortgage origination and mortgage servicing . while we expect our revenue from ocwen 's servicing portfolio will decline in 2015 , we believe we have opportunities to continue to build our business from our revenue and diversification initiatives . ocwen remains a very important component of our business and we believe that its existing non-gse portfolio provides continuing revenue opportunities for altisource . while we have been working on our strategic growth initiatives for some time , we have historically had to balance this activity with the need to support ocwen during a period of its own rapid growth . given our current expectations relative to ocwen going forward and the recognized importance of diversifying further our customer base , we are increasing our focus on our strategic growth initiatives . our strategic growth initiatives are : mortgage market : attract new clients to our comprehensive default related businesses grow our origination services and technologies real estate market : expand our innovative online real estate marketplace grow our property management and renovation services business stock repurchase plan on february 28 , 2014 , our shareholders approved a new stock repurchase program , which replaced the previous stock repurchase program . under the new program , we are authorized to purchase up to 3.4 million shares of our common stock , based on a limit of 15 % of the outstanding shares of common stock on the date of approval , in the open market , at a minimum price of $ 1.00 per share and a maximum price of $ 500.00 per share . this is in addition to amounts previously purchased under the prior programs . from authorization of the previous programs through december 31 , 2014 , we have purchased approximately 6.2 million shares of our common stock in the open market at an average price of $ 79.16 per share . we purchased 2.5 million shares of common stock at an average price of $ 103.67 per share during the year ended december 31 , 2014 and 1.2 million shares at an average price of $ 116.99 per share during the year ended december 31 , 2013. as of december 31 , 2014 , approximately 1.1 million shares of common stock remain available for repurchase under the new program . our senior secured term loan agreement limits the amount we can spend on share repurchases in any year and may prevent repurchases in certain circumstances . as of december 31 , 2014 , approximately $ 225 million was available to repurchase our common stock under our senior secured term loan . separation of residential asset businesses on december 21 , 2012 , we completed the spin-off of residential and aamc to our shareholders . see “ separation of the residential asset businesses ” in item 1 of part i , “ business . ” 24 on december 24 , 2012 , the shares of residential and aamc were distributed to our shareholders of record as of december 17 , 2012 , in the form of a taxable pro rata stock distribution . our shareholders received a pro rata distribution of : one share of residential common stock for every three shares of altisource common stock held ; one share of aamc common stock for every ten shares of altisource common stock held ; and cash in lieu of fractional residential and aamc shares . residential is focused on acquiring and managing single family rental properties by acquiring sub-performing and non-performing residential mortgage loans as well as single family homes at or following the foreclosure sale throughout the united states . aamc provides asset management and certain corporate governance services to residential . we provide property management , lease management and renovation management services to residential . prior to the separation , we capitalized residential with $ 100 million of cash and aamc with $ 5 million of cash . we eliminated the assets and liabilities of residential and aamc from our consolidated balance sheet effective at the close of business on december 21 , 2012. as residential and aamc were development stage companies and had not yet commenced operations at the time of separation , these entities had no historical results of operations . we do not expect any negative impact on our future operations other than interest expense on the debt we borrowed in november 2012 to capitalize these entities . story_separator_special_tag when new loans are boarded by ocwen onto realservicing , for the initial months post-boarding , we tend to deliver an elevated level of lower margin residential property valuation and property inspection and preservation services . 33 selling , general and administrative expenses and income from operations sg & a expenses consist of the following for the years ended december 31 : replace_table_token_15_th n/m — not meaningful . sg & a for the year ended december 31 , 2014 of $ 94.7 million increased by 104 % compared to the year ended december 31 , 2013 , primarily driven by marketing costs largely related to hubzu , higher legal costs and bad debt expense in 2014 and increased amortization of intangible assets recorded in connection with the acquisition of the homeward and rescap fee-based businesses . bad debt expense increased in 2014 by $ 12.0 million , driven primarily from the default management services business . a change in our customers ' business model and fourth quarter 2014 discussions with these customers led us to believe that a portion of the accounts receivable balance is no longer collectible . sg & a for the year ended december 31 , 2013 of $ 46.5 million increased by 85 % compared to the year ended december 31 , 2012 , primarily driven by the increase in amortization expense from the 2013 acquisitions of the homeward and rescap fee-based businesses partially offset by higher professional services costs incurred in 2012 in connection with the separation of the residential asset businesses . income from operations increased to $ 210.9 million , representing 32 % of service revenue , for the year ended december 31 , 2014 compared to $ 174.9 million , representing 36 % of service revenue , for the year ended december 31 , 2013 and $ 142.1 million , representing 40 % of service revenue , for the year ended december 31 , 2012 . the decrease in operating income margin is primarily driven by higher hubzu marketing costs and increases in the amortization of intangible assets recorded in connection with the homeward and rescap fee-based business acquisitions and the other increases in sg & a , as discussed above . in 2014 , the decrease in operating income margin was partially offset by the higher gross profit margin , as discussed above . in 2013 , the operating income margin was impacted by lower gross profit margins and higher amortization expense . financial services revenue revenue by service line was as follows for the years ended december 31 : replace_table_token_16_th n/m — not meaningful . 34 we recognized service revenue of $ 98.3 million for the year ended december 31 , 2014 , a 6 % increase compared to the year ended december 31 , 2013 , primarily due to growth in the customer relationship management business from the addition of new clients and expansion of services provided to existing clients . we recognized service revenue of $ 92.5 million for the year ended december 31 , 2013 , a 45 % increase compared to the year ended december 31 , 2012 , primarily due to increased mortgage charge-off collections and growth in customer relationship management revenues from the addition of two new clients during 2013 and expansion of services provided to existing clients . the increases were partially offset by lower credit card charge-off placements from record low credit card delinquency rates . with respect to the mortgage charge-off business , we expanded our capabilities in connection with the rescap fee-based business transaction , and in the second quarter of 2013 , we began providing these services to the rescap loans serviced by ocwen and a greater portion of the other loans in the ocwen portfolio . certain of our financial services businesses are impacted by seasonality . revenue in the asset recovery management business tends to be higher in the first quarter , as borrowers may utilize tax refunds and bonuses to pay debts , and generally declines throughout the rest of the year . cost of revenue and gross profit cost of revenue consists of the following for the years ended december 31 : replace_table_token_17_th cost of revenue for the year ended december 31 , 2014 of $ 64.3 million increased by 16 % compared to the year ended december 31 , 2013 primarily due to higher compensation and benefits costs and higher technology and telecommunications expense from investments in our it infrastructure to support revenue growth . cost of revenue for the year ended december 31 , 2013 of $ 55.3 million increased by 18 % compared to the year ended december 31 , 2012 , driven primarily by higher compensation cost from an increase in the number of employees in the mortgage charge-off and customer relationship management businesses to support revenue growth . these increases in both years were partially offset by lower outside fees and services as we experienced the benefit of our vendor cost reduction initiatives . gross profit decreased to $ 34.2 million , representing 35 % of service revenue , for the year ended december 31 , 2014 compared to $ 37.6 million , representing 41 % of service revenue , for the year ended december 31 , 2013 and $ 17.8 million , representing 28 % of service revenue , for the year ended december 31 , 2012. in 2014 , gross profit margin decreased due to higher technology and telecommunications expense from investments in our it infrastructure and an increase in employee costs due to increases in headcount to support revenue growth and a slight shift in revenue mix . in 2013 , gross profit as a percentage of service revenue increased due to growth of the higher margin mortgage charge-off and customer relationship management services . 35 selling , general and administrative expenses and income from operations sg & a expenses consist of the following for the years ended december 31 : replace_table_token_18_th n/m — not meaningful .

cash $ 100,000 $ 5,000 $ 105,000 reduction in altisource retained earnings $ 100,000 $ 5,000 $ 105,000 correction of immaterial errors as previously disclosed , during 2014 we determined that while we properly identified our related parties in previously issued financial statements , disclosures of certain immaterial related party expenses were omitted . we have corrected the previously presented disclosures of related party expenses in note 4 - transactions with related parties and on the face of the consolidated statements of operations for the years ended december 31 , 2013 and 2012. the impact of correcting these items in the notes to the consolidated financial statements had the effect of : increasing the amounts disclosed as related party cost of revenue from ocwen by $ 20.0 million and $ 13.5 million for the years ended december 31 , 2013 and 2012 , respectively ; increasing the amounts disclosed as selling , general and administrative expenses ( “ sg & a ” ) from ocwen billings to altisource by $ 1.7 million and $ 0.7 million for the years ended december 31 , 2013 and 2012 , respectively ; decreasing the amounts disclosed as sg & a from altisource billings to ocwen by $ 0.1 million and less than $ 0.1 million for the years ended december 31 , 2013 and 2012 , respectively ; and decreasing the amounts disclosed as sg & a from altisource billings to aamc by $ 0.5 million for the year ended december 31 , 2013 ( no adjustment for the year ended december 31 , 2012 ) . correcting these items on the face of the consolidated statements of operations resulted in the disclosure of related party cost of revenue of $ 20.0 million and $ 13.5 million for the years ended december 31 , 2013 and 2012 , respectively , and a decrease in previously disclosed related party sg & a by $ 2.4 million and $ 3.0 million for the years ended december 31 , 2013 and 2012 , respectively .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```cash $ 100,000 $ 5,000 $ 105,000 reduction in altisource retained earnings $ 100,000 $ 5,000 $ 105,000 correction of immaterial errors as previously disclosed , during 2014 we determined that while we properly identified our related parties in previously issued financial statements , disclosures of certain immaterial related party expenses were omitted . we have corrected the previously presented disclosures of related party expenses in note 4 - transactions with related parties and on the face of the consolidated statements of operations for the years ended december 31 , 2013 and 2012. the impact of correcting these items in the notes to the consolidated financial statements had the effect of : increasing the amounts disclosed as related party cost of revenue from ocwen by $ 20.0 million and $ 13.5 million for the years ended december 31 , 2013 and 2012 , respectively ; increasing the amounts disclosed as selling , general and administrative expenses ( “ sg & a ” ) from ocwen billings to altisource by $ 1.7 million and $ 0.7 million for the years ended december 31 , 2013 and 2012 , respectively ; decreasing the amounts disclosed as sg & a from altisource billings to ocwen by $ 0.1 million and less than $ 0.1 million for the years ended december 31 , 2013 and 2012 , respectively ; and decreasing the amounts disclosed as sg & a from altisource billings to aamc by $ 0.5 million for the year ended december 31 , 2013 ( no adjustment for the year ended december 31 , 2012 ) . correcting these items on the face of the consolidated statements of operations resulted in the disclosure of related party cost of revenue of $ 20.0 million and $ 13.5 million for the years ended december 31 , 2013 and 2012 , respectively , and a decrease in previously disclosed related party sg & a by $ 2.4 million and $ 3.0 million for the years ended december 31 , 2013 and 2012 , respectively . ``` Suspicious Activity Report : service revenue consists of amounts attributable to our fee-based services . reimbursable expenses and non-controlling interests are pass-through items for which we earn no margin . reimbursable expenses consist of amounts we incur on behalf of our customers in performing our fee-based services , but we pass such costs directly on to our customers without any additional markup . non-controlling interests represent the earnings of lenders one , a consolidated entity not owned by altisource , and are included in revenue and reduced from net income to arrive at net income attributable to altisource . we have prepared our consolidated financial statements in accordance with accounting principles generally accepted in the united states of america . altisource 's vision and growth initiatives altisource provides a suite of mortgage , real estate and consumer debt services , leveraging our technology and global operations . our relationship with ocwen provided a foundation on which we built our business and ocwen , as our largest customer , remains an important priority for us . leveraging the services we have built through the ocwen and other relationships , altisource is focused on becoming the premier provider of real estate and mortgage marketplaces offering both distribution and content to a diversified customer base . within the real estate and mortgage markets , we are facilitating transactions related to home sales , home rentals , home maintenance , mortgage origination and mortgage servicing . while we expect our revenue from ocwen 's servicing portfolio will decline in 2015 , we believe we have opportunities to continue to build our business from our revenue and diversification initiatives . ocwen remains a very important component of our business and we believe that its existing non-gse portfolio provides continuing revenue opportunities for altisource . while we have been working on our strategic growth initiatives for some time , we have historically had to balance this activity with the need to support ocwen during a period of its own rapid growth . given our current expectations relative to ocwen going forward and the recognized importance of diversifying further our customer base , we are increasing our focus on our strategic growth initiatives . our strategic growth initiatives are : mortgage market : attract new clients to our comprehensive default related businesses grow our origination services and technologies real estate market : expand our innovative online real estate marketplace grow our property management and renovation services business stock repurchase plan on february 28 , 2014 , our shareholders approved a new stock repurchase program , which replaced the previous stock repurchase program . under the new program , we are authorized to purchase up to 3.4 million shares of our common stock , based on a limit of 15 % of the outstanding shares of common stock on the date of approval , in the open market , at a minimum price of $ 1.00 per share and a maximum price of $ 500.00 per share . this is in addition to amounts previously purchased under the prior programs . from authorization of the previous programs through december 31 , 2014 , we have purchased approximately 6.2 million shares of our common stock in the open market at an average price of $ 79.16 per share . we purchased 2.5 million shares of common stock at an average price of $ 103.67 per share during the year ended december 31 , 2014 and 1.2 million shares at an average price of $ 116.99 per share during the year ended december 31 , 2013. as of december 31 , 2014 , approximately 1.1 million shares of common stock remain available for repurchase under the new program . our senior secured term loan agreement limits the amount we can spend on share repurchases in any year and may prevent repurchases in certain circumstances . as of december 31 , 2014 , approximately $ 225 million was available to repurchase our common stock under our senior secured term loan . separation of residential asset businesses on december 21 , 2012 , we completed the spin-off of residential and aamc to our shareholders . see “ separation of the residential asset businesses ” in item 1 of part i , “ business . ” 24 on december 24 , 2012 , the shares of residential and aamc were distributed to our shareholders of record as of december 17 , 2012 , in the form of a taxable pro rata stock distribution . our shareholders received a pro rata distribution of : one share of residential common stock for every three shares of altisource common stock held ; one share of aamc common stock for every ten shares of altisource common stock held ; and cash in lieu of fractional residential and aamc shares . residential is focused on acquiring and managing single family rental properties by acquiring sub-performing and non-performing residential mortgage loans as well as single family homes at or following the foreclosure sale throughout the united states . aamc provides asset management and certain corporate governance services to residential . we provide property management , lease management and renovation management services to residential . prior to the separation , we capitalized residential with $ 100 million of cash and aamc with $ 5 million of cash . we eliminated the assets and liabilities of residential and aamc from our consolidated balance sheet effective at the close of business on december 21 , 2012. as residential and aamc were development stage companies and had not yet commenced operations at the time of separation , these entities had no historical results of operations . we do not expect any negative impact on our future operations other than interest expense on the debt we borrowed in november 2012 to capitalize these entities . story_separator_special_tag when new loans are boarded by ocwen onto realservicing , for the initial months post-boarding , we tend to deliver an elevated level of lower margin residential property valuation and property inspection and preservation services . 33 selling , general and administrative expenses and income from operations sg & a expenses consist of the following for the years ended december 31 : replace_table_token_15_th n/m — not meaningful . sg & a for the year ended december 31 , 2014 of $ 94.7 million increased by 104 % compared to the year ended december 31 , 2013 , primarily driven by marketing costs largely related to hubzu , higher legal costs and bad debt expense in 2014 and increased amortization of intangible assets recorded in connection with the acquisition of the homeward and rescap fee-based businesses . bad debt expense increased in 2014 by $ 12.0 million , driven primarily from the default management services business . a change in our customers ' business model and fourth quarter 2014 discussions with these customers led us to believe that a portion of the accounts receivable balance is no longer collectible . sg & a for the year ended december 31 , 2013 of $ 46.5 million increased by 85 % compared to the year ended december 31 , 2012 , primarily driven by the increase in amortization expense from the 2013 acquisitions of the homeward and rescap fee-based businesses partially offset by higher professional services costs incurred in 2012 in connection with the separation of the residential asset businesses . income from operations increased to $ 210.9 million , representing 32 % of service revenue , for the year ended december 31 , 2014 compared to $ 174.9 million , representing 36 % of service revenue , for the year ended december 31 , 2013 and $ 142.1 million , representing 40 % of service revenue , for the year ended december 31 , 2012 . the decrease in operating income margin is primarily driven by higher hubzu marketing costs and increases in the amortization of intangible assets recorded in connection with the homeward and rescap fee-based business acquisitions and the other increases in sg & a , as discussed above . in 2014 , the decrease in operating income margin was partially offset by the higher gross profit margin , as discussed above . in 2013 , the operating income margin was impacted by lower gross profit margins and higher amortization expense . financial services revenue revenue by service line was as follows for the years ended december 31 : replace_table_token_16_th n/m — not meaningful . 34 we recognized service revenue of $ 98.3 million for the year ended december 31 , 2014 , a 6 % increase compared to the year ended december 31 , 2013 , primarily due to growth in the customer relationship management business from the addition of new clients and expansion of services provided to existing clients . we recognized service revenue of $ 92.5 million for the year ended december 31 , 2013 , a 45 % increase compared to the year ended december 31 , 2012 , primarily due to increased mortgage charge-off collections and growth in customer relationship management revenues from the addition of two new clients during 2013 and expansion of services provided to existing clients . the increases were partially offset by lower credit card charge-off placements from record low credit card delinquency rates . with respect to the mortgage charge-off business , we expanded our capabilities in connection with the rescap fee-based business transaction , and in the second quarter of 2013 , we began providing these services to the rescap loans serviced by ocwen and a greater portion of the other loans in the ocwen portfolio . certain of our financial services businesses are impacted by seasonality . revenue in the asset recovery management business tends to be higher in the first quarter , as borrowers may utilize tax refunds and bonuses to pay debts , and generally declines throughout the rest of the year . cost of revenue and gross profit cost of revenue consists of the following for the years ended december 31 : replace_table_token_17_th cost of revenue for the year ended december 31 , 2014 of $ 64.3 million increased by 16 % compared to the year ended december 31 , 2013 primarily due to higher compensation and benefits costs and higher technology and telecommunications expense from investments in our it infrastructure to support revenue growth . cost of revenue for the year ended december 31 , 2013 of $ 55.3 million increased by 18 % compared to the year ended december 31 , 2012 , driven primarily by higher compensation cost from an increase in the number of employees in the mortgage charge-off and customer relationship management businesses to support revenue growth . these increases in both years were partially offset by lower outside fees and services as we experienced the benefit of our vendor cost reduction initiatives . gross profit decreased to $ 34.2 million , representing 35 % of service revenue , for the year ended december 31 , 2014 compared to $ 37.6 million , representing 41 % of service revenue , for the year ended december 31 , 2013 and $ 17.8 million , representing 28 % of service revenue , for the year ended december 31 , 2012. in 2014 , gross profit margin decreased due to higher technology and telecommunications expense from investments in our it infrastructure and an increase in employee costs due to increases in headcount to support revenue growth and a slight shift in revenue mix . in 2013 , gross profit as a percentage of service revenue increased due to growth of the higher margin mortgage charge-off and customer relationship management services . 35 selling , general and administrative expenses and income from operations sg & a expenses consist of the following for the years ended december 31 : replace_table_token_18_th n/m — not meaningful .

33 results of operations revenue we recognize revenue from the sale of xpresspa products and services at the point of sale , net of discounts and applicable sales taxes . revenues from the xpresspa wholesale and e-commerce businesses are recorded at the time goods are shipped . we exclude all sales taxes assessed to our customers . sales taxes assessed on revenues are included in accounts payable , accrued expenses and other current liabilities in the consolidated balance sheets until remitted to the state agencies . we record revenue from the product sales of group mobile and fli charge when title and risk of loss are passed to the customer , there is persuasive evidence of an arrangement for sale , delivery has occurred , the sales price is fixed or determinable , and collectability is reasonably assured . our shipping terms typically specify f.o.b . destination , at which time title and risk of loss have passed to the customer . at the time of sale of hardware products , we record an estimate for sales returns and allowances based on historical experience . hardware products sold by us are warranted by the vendor . group mobile uses drop-shipment arrangements with many of its hardware vendors and suppliers to deliver products directly to customers . revenue for drop-shipment arrangements is recorded on a gross basis upon delivery to the customer with contract terms that typically specify f.o.b . destination . revenue is recognized on a gross basis as group mobile is the principal in the transaction as the primary obligor in the arrangement , assumes the inventory risk if the product is returned by the customer , sets the price of the product to the customer , assumes credit risk for the amounts invoiced , and works closely with the customers to determine their hardware specifications . freight billed to customers is recognized as net product revenue and the related freight costs as a cost of goods sold . deferred revenue includes ( i ) payments received from customers in advance of providing products and services and ( ii ) amounts deferred if other conditions of revenue recognition have not been met . we account for funds raised from crowdfunding campaigns and pre-sales as deferred revenue until the product is delivered to customers . revenue from patent licensing is recognized if collectability is reasonably assured , persuasive evidence of an arrangement exists , the sales price is fixed or determinable and delivery of the service has been rendered . currently , revenue arrangements related to intellectual property provide for the payment of contractually determined fees and other consideration for the grant of certain intellectual property rights related to our patents . these rights typically include some combination of the following : ( i ) the grant of a non-exclusive , retroactive and future license to manufacture and or sell products covered by patents , ( ii ) the release of the licensee from certain claims , and ( iii ) the dismissal of any pending litigation . the intellectual property rights granted typically extend until the expiration of the related patents . pursuant to the terms of these agreements , we have no further obligation with respect to the grant of the non-exclusive retroactive and future licenses , covenants-not-to-sue , releases , and other deliverables , including no express or implied obligation on our part to maintain or upgrade the related technology , or provide future support or services . generally , the agreements provide for the grant of the licenses , covenants-not-to-sue , releases , and other significant deliverables upon execution of the agreement , or upon receipt of the upfront payment . as such , the earnings process is complete and revenue is recognized upon the execution of the agreement , upon receipt of the upfront fee , and when all other revenue recognition criteria have been met . 34 intellectual property costs intellectual property costs mainly include expenses incurred in connection with our patent licensing and enforcement activities , patent-related legal expenses paid to external patent counsel ( including contingent legal fees ) , licensing and enforcement related research , consulting and other expenses paid to third parties , as well as related internal payroll expenses and stock-based compensation . in addition , amounts received by us for reimbursements of legal fees in connection with our litigation campaigns are recorded in intellectual property costs as an offset to legal expense . also included in intellectual property costs are royalties owed to previous owners of our intellectual property assets . the royalties fluctuate period to period , based on the amount of licensing revenue we recognize each period , the terms and conditions of agreements executed each period and the mix of specific patent portfolios with varying economic terms and obligations generating revenues each period . depreciation , amortization and impairment property and equipment is stated at cost , net of accumulated depreciation . depreciation is calculated on a straight-line basis over the estimated useful lives of the assets . the useful lives of our property and equipment is based on estimates of the period over which we expect the assets to be of economic benefit to us . leasehold improvements are amortized over the shorter of the useful life of the asset or the term of the lease . amortization of our acquired patent portfolios and other intangible assets are recognized on a straight-line basis over the remaining useful life of the intangible assets ( i.e . , through the expiration date of the patent ) . impairment charges related to our acquired intangible assets are recorded when an impairment indicator exists and the carrying amount of the related asset exceeds its fair value . story_separator_special_tag 41 critical accounting policies while our significant accounting policies are more fully described in the notes to our audited consolidated financial statements for the year ended december 31 , 2016 , which appear elsewhere in this annual report on form 10-k , we believe the following accounting policies to be the most critical in understanding the judgments and estimates we used in preparing our consolidated financial statements for the year ended december 31 , 2016. revenue recognition we recognize revenue from the sale of xpresspa products and services at the point of sale , net of discounts and applicable sales taxes . revenues from the xpresspa wholesale and e-commerce businesses are recorded at the time goods are shipped . we exclude all sales taxes assessed to our customers . sales taxes assessed on revenues are included in accounts payable , accrued expenses and other current liabilities in the consolidated balance sheets until remitted to the state agencies . we record revenue from the product sales of group mobile and fli charge when title and risk of loss are passed to the customer , there is persuasive evidence of an arrangement for sale , delivery has occurred , the sales price is fixed or determinable , and collectability is reasonably assured . our shipping terms typically specify f.o.b . destination , at which time title and risk of loss have passed to the customer . at the time of sale of hardware products , we record an estimate for sales returns and allowances based on historical experience . hardware products sold by us are warranted by the vendor . group mobile uses drop-shipment arrangements with many of its hardware vendors and suppliers to deliver products directly to customers . revenue for drop-shipment arrangements is recorded on a gross basis upon delivery to the customer with contract terms that typically specify f.o.b . destination . revenue is recognized on a gross basis as group mobile is the principal in the transaction as the primary obligor in the arrangement , assumes the inventory risk if the product is returned by the customer , sets the price of the product to the customer , assumes credit risk for the amounts invoiced , and works closely with the customers to determine their hardware specifications . freight billed to customers is recognized as net product revenue and the related freight costs as a cost of goods sold . deferred revenue includes ( i ) payments received from customers in advance of providing products and services and ( ii ) amounts deferred if other conditions of revenue recognition have not been met . we account for funds raised from crowdfunding campaigns and pre-sales as deferred revenue until the product is delivered to customers . revenue from patent licensing is recognized if collectability is reasonably assured , persuasive evidence of an arrangement exists , the sales price is fixed or determinable and delivery of the service has been rendered . currently , revenue arrangements related to intellectual property provide for the payment of contractually determined fees and other consideration for the grant of certain intellectual property rights related to our patents . these rights typically include some combination of the following : ( i ) the grant of a non-exclusive , retroactive and future license to manufacture and or sell products covered by patents , ( ii ) the release of the licensee from certain claims , and ( iii ) the dismissal of any pending litigation . the intellectual property rights granted typically extend until the expiration of the related patents . pursuant to the terms of these agreements , we have no further obligation with respect to the grant of the non-exclusive retroactive and future licenses , covenants-not-to-sue , releases , and other deliverables , including no express or implied obligation on our part to maintain or upgrade the related technology , or provide future support or services . generally , the agreements provide for the grant of the licenses , covenants-not-to-sue , releases , and other significant deliverables upon execution of the agreement , or upon receipt of the upfront payment . as such , the earnings process is complete and revenue is recognized upon the execution of the agreement , upon receipt of the upfront fee , and when all other revenue recognition criteria have been met . 42 goodwill goodwill is an asset representing the future economic benefits arising from other assets acquired in a business combination that are not individually identified and separately recognized . goodwill is reviewed for impairment at least annually , and when triggering events occur , in accordance with the provisions of financial accounting standards board ( “ fasb ” ) accounting standards codification ( “ asc ” ) topic 350 , intangibles – goodwill and other . we have four reporting units for purposes of evaluating goodwill impairment and perform our annual goodwill impairment test on december 31. we have the option to perform a qualitative assessment to determine if an impairment is more likely than not to have occurred . if we can support the conclusion that it is not more likely than not that the fair value of a reporting unit is less than its carrying amount , then we would not need to perform the two-step impairment test for the reporting unit . if we can not support such a conclusion or do not elect to perform the qualitative assessment , then the first step of the goodwill impairment test is used to identify potential impairment by comparing the fair value of the reporting unit with its carrying amount , including goodwill . if the fair value of the reporting unit exceeds its carrying value , then the second step of the impairment test ( measurement ) does not need to be performed . if the fair value of the reporting unit is less than its carrying value , an indication of goodwill impairment exists for the reporting unit and the entity must perform

liquidity and capital resources as of december 31 , 2016 , we had a cash balance of $ 17,910,000 , which represents a decrease of $ 7,041,000 compared to our cash balance as of december 31 , 2015. we anticipate that our need for capital will increase as xpresspa wins rfps , begins construction on new locations and remodels certain existing locations in order to enhance efficiency and corporate branding . in 2017 , xpresspa plans to open several new locations and is currently working on 25 additional rfps in which it plans to participate . we do n't expect any significant capital will be needed for our group mobile and intellectual property operating segments . we are currently exploring strategic alternatives for fli charge to maximize shareholders value , including additional financing and other options . cash expenditures during the year ended december 31 , 2016 were offset by cash received by our xpresspa , group mobile , fli charge and intellectual property operating segments during the normal course of business as well as cash received for refunds of court fees and our deposits with the courts in germany , brazil , and romania . our average monthly net cash used in operations for the year ended december 31 , 2016 was approximately $ 703,000 compared to average monthly net cash used in operations of approximately $ 214,000 during the year ended december 31 , 2015. this increase in net cash used is driven by the cash spent in our group mobile and fli charge operations and the significant decrease in revenues from our intellectual property operating segment .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```liquidity and capital resources as of december 31 , 2016 , we had a cash balance of $ 17,910,000 , which represents a decrease of $ 7,041,000 compared to our cash balance as of december 31 , 2015. we anticipate that our need for capital will increase as xpresspa wins rfps , begins construction on new locations and remodels certain existing locations in order to enhance efficiency and corporate branding . in 2017 , xpresspa plans to open several new locations and is currently working on 25 additional rfps in which it plans to participate . we do n't expect any significant capital will be needed for our group mobile and intellectual property operating segments . we are currently exploring strategic alternatives for fli charge to maximize shareholders value , including additional financing and other options . cash expenditures during the year ended december 31 , 2016 were offset by cash received by our xpresspa , group mobile , fli charge and intellectual property operating segments during the normal course of business as well as cash received for refunds of court fees and our deposits with the courts in germany , brazil , and romania . our average monthly net cash used in operations for the year ended december 31 , 2016 was approximately $ 703,000 compared to average monthly net cash used in operations of approximately $ 214,000 during the year ended december 31 , 2015. this increase in net cash used is driven by the cash spent in our group mobile and fli charge operations and the significant decrease in revenues from our intellectual property operating segment . ``` Suspicious Activity Report : 33 results of operations revenue we recognize revenue from the sale of xpresspa products and services at the point of sale , net of discounts and applicable sales taxes . revenues from the xpresspa wholesale and e-commerce businesses are recorded at the time goods are shipped . we exclude all sales taxes assessed to our customers . sales taxes assessed on revenues are included in accounts payable , accrued expenses and other current liabilities in the consolidated balance sheets until remitted to the state agencies . we record revenue from the product sales of group mobile and fli charge when title and risk of loss are passed to the customer , there is persuasive evidence of an arrangement for sale , delivery has occurred , the sales price is fixed or determinable , and collectability is reasonably assured . our shipping terms typically specify f.o.b . destination , at which time title and risk of loss have passed to the customer . at the time of sale of hardware products , we record an estimate for sales returns and allowances based on historical experience . hardware products sold by us are warranted by the vendor . group mobile uses drop-shipment arrangements with many of its hardware vendors and suppliers to deliver products directly to customers . revenue for drop-shipment arrangements is recorded on a gross basis upon delivery to the customer with contract terms that typically specify f.o.b . destination . revenue is recognized on a gross basis as group mobile is the principal in the transaction as the primary obligor in the arrangement , assumes the inventory risk if the product is returned by the customer , sets the price of the product to the customer , assumes credit risk for the amounts invoiced , and works closely with the customers to determine their hardware specifications . freight billed to customers is recognized as net product revenue and the related freight costs as a cost of goods sold . deferred revenue includes ( i ) payments received from customers in advance of providing products and services and ( ii ) amounts deferred if other conditions of revenue recognition have not been met . we account for funds raised from crowdfunding campaigns and pre-sales as deferred revenue until the product is delivered to customers . revenue from patent licensing is recognized if collectability is reasonably assured , persuasive evidence of an arrangement exists , the sales price is fixed or determinable and delivery of the service has been rendered . currently , revenue arrangements related to intellectual property provide for the payment of contractually determined fees and other consideration for the grant of certain intellectual property rights related to our patents . these rights typically include some combination of the following : ( i ) the grant of a non-exclusive , retroactive and future license to manufacture and or sell products covered by patents , ( ii ) the release of the licensee from certain claims , and ( iii ) the dismissal of any pending litigation . the intellectual property rights granted typically extend until the expiration of the related patents . pursuant to the terms of these agreements , we have no further obligation with respect to the grant of the non-exclusive retroactive and future licenses , covenants-not-to-sue , releases , and other deliverables , including no express or implied obligation on our part to maintain or upgrade the related technology , or provide future support or services . generally , the agreements provide for the grant of the licenses , covenants-not-to-sue , releases , and other significant deliverables upon execution of the agreement , or upon receipt of the upfront payment . as such , the earnings process is complete and revenue is recognized upon the execution of the agreement , upon receipt of the upfront fee , and when all other revenue recognition criteria have been met . 34 intellectual property costs intellectual property costs mainly include expenses incurred in connection with our patent licensing and enforcement activities , patent-related legal expenses paid to external patent counsel ( including contingent legal fees ) , licensing and enforcement related research , consulting and other expenses paid to third parties , as well as related internal payroll expenses and stock-based compensation . in addition , amounts received by us for reimbursements of legal fees in connection with our litigation campaigns are recorded in intellectual property costs as an offset to legal expense . also included in intellectual property costs are royalties owed to previous owners of our intellectual property assets . the royalties fluctuate period to period , based on the amount of licensing revenue we recognize each period , the terms and conditions of agreements executed each period and the mix of specific patent portfolios with varying economic terms and obligations generating revenues each period . depreciation , amortization and impairment property and equipment is stated at cost , net of accumulated depreciation . depreciation is calculated on a straight-line basis over the estimated useful lives of the assets . the useful lives of our property and equipment is based on estimates of the period over which we expect the assets to be of economic benefit to us . leasehold improvements are amortized over the shorter of the useful life of the asset or the term of the lease . amortization of our acquired patent portfolios and other intangible assets are recognized on a straight-line basis over the remaining useful life of the intangible assets ( i.e . , through the expiration date of the patent ) . impairment charges related to our acquired intangible assets are recorded when an impairment indicator exists and the carrying amount of the related asset exceeds its fair value . story_separator_special_tag 41 critical accounting policies while our significant accounting policies are more fully described in the notes to our audited consolidated financial statements for the year ended december 31 , 2016 , which appear elsewhere in this annual report on form 10-k , we believe the following accounting policies to be the most critical in understanding the judgments and estimates we used in preparing our consolidated financial statements for the year ended december 31 , 2016. revenue recognition we recognize revenue from the sale of xpresspa products and services at the point of sale , net of discounts and applicable sales taxes . revenues from the xpresspa wholesale and e-commerce businesses are recorded at the time goods are shipped . we exclude all sales taxes assessed to our customers . sales taxes assessed on revenues are included in accounts payable , accrued expenses and other current liabilities in the consolidated balance sheets until remitted to the state agencies . we record revenue from the product sales of group mobile and fli charge when title and risk of loss are passed to the customer , there is persuasive evidence of an arrangement for sale , delivery has occurred , the sales price is fixed or determinable , and collectability is reasonably assured . our shipping terms typically specify f.o.b . destination , at which time title and risk of loss have passed to the customer . at the time of sale of hardware products , we record an estimate for sales returns and allowances based on historical experience . hardware products sold by us are warranted by the vendor . group mobile uses drop-shipment arrangements with many of its hardware vendors and suppliers to deliver products directly to customers . revenue for drop-shipment arrangements is recorded on a gross basis upon delivery to the customer with contract terms that typically specify f.o.b . destination . revenue is recognized on a gross basis as group mobile is the principal in the transaction as the primary obligor in the arrangement , assumes the inventory risk if the product is returned by the customer , sets the price of the product to the customer , assumes credit risk for the amounts invoiced , and works closely with the customers to determine their hardware specifications . freight billed to customers is recognized as net product revenue and the related freight costs as a cost of goods sold . deferred revenue includes ( i ) payments received from customers in advance of providing products and services and ( ii ) amounts deferred if other conditions of revenue recognition have not been met . we account for funds raised from crowdfunding campaigns and pre-sales as deferred revenue until the product is delivered to customers . revenue from patent licensing is recognized if collectability is reasonably assured , persuasive evidence of an arrangement exists , the sales price is fixed or determinable and delivery of the service has been rendered . currently , revenue arrangements related to intellectual property provide for the payment of contractually determined fees and other consideration for the grant of certain intellectual property rights related to our patents . these rights typically include some combination of the following : ( i ) the grant of a non-exclusive , retroactive and future license to manufacture and or sell products covered by patents , ( ii ) the release of the licensee from certain claims , and ( iii ) the dismissal of any pending litigation . the intellectual property rights granted typically extend until the expiration of the related patents . pursuant to the terms of these agreements , we have no further obligation with respect to the grant of the non-exclusive retroactive and future licenses , covenants-not-to-sue , releases , and other deliverables , including no express or implied obligation on our part to maintain or upgrade the related technology , or provide future support or services . generally , the agreements provide for the grant of the licenses , covenants-not-to-sue , releases , and other significant deliverables upon execution of the agreement , or upon receipt of the upfront payment . as such , the earnings process is complete and revenue is recognized upon the execution of the agreement , upon receipt of the upfront fee , and when all other revenue recognition criteria have been met . 42 goodwill goodwill is an asset representing the future economic benefits arising from other assets acquired in a business combination that are not individually identified and separately recognized . goodwill is reviewed for impairment at least annually , and when triggering events occur , in accordance with the provisions of financial accounting standards board ( “ fasb ” ) accounting standards codification ( “ asc ” ) topic 350 , intangibles – goodwill and other . we have four reporting units for purposes of evaluating goodwill impairment and perform our annual goodwill impairment test on december 31. we have the option to perform a qualitative assessment to determine if an impairment is more likely than not to have occurred . if we can support the conclusion that it is not more likely than not that the fair value of a reporting unit is less than its carrying amount , then we would not need to perform the two-step impairment test for the reporting unit . if we can not support such a conclusion or do not elect to perform the qualitative assessment , then the first step of the goodwill impairment test is used to identify potential impairment by comparing the fair value of the reporting unit with its carrying amount , including goodwill . if the fair value of the reporting unit exceeds its carrying value , then the second step of the impairment test ( measurement ) does not need to be performed . if the fair value of the reporting unit is less than its carrying value , an indication of goodwill impairment exists for the reporting unit and the entity must perform

21 merger transaction on may 28 , 2010 , hillman was acquired by affiliates of ohcp and certain members of hillman 's management and board of directors . pursuant to the terms and conditions of an agreement and plan of merger dated as of april 21 , 2010 , the company was merged with an affiliate of ohcp with the company surviving the merger transaction . as a result of the merger transaction , hillman is a wholly-owned subsidiary of holdco . the total consideration paid in the merger transaction was $ 832.7 million which includes $ 11.5 million for the quick tag license and related patents , repayment of outstanding debt , and the net value of the company 's outstanding junior subordinated debentures ( $ 105.4 million liquidation value , net of $ 3.3 million in trust common securities , at the time of the merger ) . financing arrangements on may 28 , 2010 , the company and certain of our subsidiaries closed on a $ 320.0 million senior secured first lien credit facility ( the “senior facilities” ) , consisting of a $ 290.0 million term loan and a $ 30.0 million revolving credit facility ( “revolver” ) . the term loan portion of the senior facilities had a six year term and the revolver had a five year term . the senior facilities provide borrowings at interest rates based on a eurodollar rate plus a margin of 3.75 % ( the “eurodollar margin” ) , or a base rate ( the “base rate” ) plus a margin of 2.75 % ( the “base rate margin” ) . the eurodollar rate was subject to a minimum floor of 1.75 % and the base rate was subject to a minimum floor of 2.75 % . concurrently with the merger transaction , hillman group issued $ 150.0 million aggregate principal amount of senior notes due 2018 ( the “10.875 % senior notes” ) . on march 16 , 2011 , hillman group completed an offering of $ 50.0 million aggregate principal amount of 10.875 % senior notes . hillman group received a premium of approximately $ 4.6 million on the $ 50.0 million 10.875 % senior notes offering . on december 21 , 2012 , hillman group completed an offering of $ 65.0 million aggregate principal amount of 10.875 % senior notes . hillman group received a premium of approximately $ 4.2 million on the $ 65.0 million 10.875 % senior notes offering . the 10.875 % senior notes are guaranteed by the hillman companies , inc. , hillman investment company , and all of the domestic subsidiaries of hillman group . hillman group pays interest on the 10.875 % senior notes semi-annually on june 1 and december 1 of each year . the senior facilities contain financial and operating covenants . these covenants require the company to maintain certain financial ratios , including a secured leverage ratio . these debt agreements provide for customary events of default , including , but not limited to , payment defaults , breach of representations or covenants , cross-defaults , bankruptcy events , failure to pay judgments , attachment of its assets , change of control , and the issuance of an order of dissolution . certain of these events of default are subject to notice and cure periods or materiality thresholds . the occurrence of an event of default permits the lenders under the senior facilities to accelerate repayment of all amounts due , terminate commitments , direct borrower to pay collateral agent additional cash collateral , and enforce any and all rights . the company pays interest to the trust on the junior subordinated debentures underlying the trust preferred securities at the rate of 11.6 % per annum on their face amount of $ 105.4 million , or $ 12.2 million per annum in the aggregate . the trust distributes an equivalent amount to the holders of the trust preferred securities . pursuant to the indenture that governs the trust preferred securities , the trust is able to defer distribution payments to holders of the trust preferred securities for a period that can not exceed 60 months ( the “deferral period” ) . during a deferral period , the company is required to accrue the full amount of all interest payable , and such deferred interest payable would become immediately payable by the company at the end of the deferral period . there were no deferrals of distribution payments to holders of the trust preferred securities in 2013 or 2012 . 22 effective april 18 , 2011 , the company completed an amendment to the credit agreement governing our senior facilities . the senior facilities amendment eliminated the total leverage and interest coverage covenants and reduced the secured leverage covenant to 4.75x with no future step downs . the term loan pricing was modified to reduce the eurodollar margin and the base rate margin by 25 basis points and reduce the floor on eurodollar and base rate loans by an additional 25 basis points . in connection with the amendment to the credit agreement , the company incurred loan discount costs of $ 1.25 million . as the modification of the senior facilities agreement was not substantial , the unamortized loan discount and debt issuance costs will be amortized over the term of the amended senior facilities . effective november 4 , 2011 , the company entered into a joinder agreement to our credit agreement under the existing senior facilities ( the “2011 incremental facility” ) . the 2011 incremental facility increased the aggregate term loan commitments available to hillman group under the senior facilities by $ 30.0 million . in connection with the 2011 incremental facility , the company incurred loan discount costs of approximately $ 0.8 million . as the modification of the senior facilities agreement was not substantial , the unamortized loan discount costs will be amortized over the term of the amended senior facilities . story_separator_special_tag year ended december 31 , 2012 and year ended december 31 , 2011 the effective income tax rates were 41.7 % and 32.4 % for the twelve month periods ended december 31 , 2012 and 2011 , respectively . the effective income tax rate differed from the federal statutory rate in the twelve month period ended december 31 , 2012 primarily due to a decrease in the reserve for unrecognized tax benefits . the effective income tax rate differed from the federal statutory rate in the twelve month period ended december 31 , 2011 primarily due to the increase in the valuation reserve recorded against certain deferred tax assets in addition to the effect of state rates . the effective income tax rate differed from the federal statutory rate in the twelve month periods ended december 31 , 2012 and 2011 due to the effect of foreign and state taxes . see note 6 , income taxes , of notes to consolidated financial statements for income taxes and disclosures related to 2012 and 2011 income tax events . 30 story_separator_special_tag font-family : times new roman ; font-size:10pt `` width= `` 100 % `` > ( 2 ) interest payments for long term senior term loans and the 10.875 % senior notes . interest payments on the variable rate long term senior term loans were calculated using the actual interest rate of 3.75 % as of december 31 , 2013. interest payments on the 10.875 % senior notes were calculated at their fixed rate . ( 3 ) all of the contractual obligations noted above are reflected on the company 's consolidated balance sheet as of december 31 , 2013 except for the interest payments , purchase obligations , and operating leases . the company has a purchase agreement with our supplier of key blanks which requires minimum purchases of 100 million key blanks per year . to the extent minimum purchases of key blanks are below 100 million , the company must pay the supplier $ .0035 per key multiplied by the shortfall . since the inception of the contract in 1998 , the company has purchased more than the requisite 100 million key blanks per year from the supplier . in 2013 , the company extended this contract for an additional three years . off-balance sheet arrangements the company does not have any off-balance sheet arrangements , as defined in item 303 ( a ) ( 4 ) ( ii ) of regulation s-k under the securities exchange act of 1934 , as amended . 33 borrowings as of december 31 , 2013 , the company had $ 26.1 million available under our secured credit facilities . the company had approximately $ 386.0 million of outstanding debt under our secured credit facilities at december 31 , 2013 , consisting of $ 385.4 million in term loans and $ 0.6 million in capitalized lease and other obligations . the term loans consisted of $ 385.4 million in term b-2 loans at a three month libor rate plus margin of 3.75 % . the capitalized lease and other obligations were at various interest rates . at december 31 , 2013 and 2012 , the company borrowings were as follows : replace_table_token_6_th descriptions of the company 's credit agreement governing the senior facilities , as amended , and the 10.875 % senior notes are contained in the “financing arrangements” section of this annual report on form 10-k. the company 's senior facilities require the maintenance of the secured leverage ratio described above and limit the ability of the company to incur debt , make investments , make dividend payments to holders of the trust preferred securities , or undertake certain other business activities . upon the occurrence of an event of default under the credit agreement , all amounts outstanding , together with accrued interest , could be declared immediately due and payable by our lenders . below are the calculations of the financial covenant , as amended on april 18 , 2011 , with the senior facilities requirement for the twelve months ended december 31 , 2013 : ( dollars in thousands ) actual ratio requirement secured leverage ratio senior term loan balance $ 385,399 revolver — capital leases and other credit obligations 556 total debt $ 385,955 adjusted ebitda ( 1 ) $ 127,240 leverage ratio ( must be below requirement ) 3.03 4.75 ( 1 ) adjusted ebitda is a non-gaap measure defined as income from operations ( $ 56,441 ) plus depreciation ( $ 24,796 ) , amortization ( $ 22,112 ) , stock compensation expense ( $ 9,006 ) , restructuring costs ( $ 4,382 ) , acquisition and integration expenses ( $ 8,638 ) , foreign exchange losses ( $ 2,252 ) , management fees ( $ 77 ) , and minus other ( $ 464 ) . 34 related party transactions the company has recorded management fee charges and expenses from ohcp of $ 77 thousand for the year ended december 31 , 2013 , $ 155 thousand for the year ended december 31 , 2012 , and $ 110 thousand for the year ended december 31 , 2011. gregory mann and gabrielle mann are employed by the all points subsidiary of hillman . all points leases an industrial warehouse and office facility from companies under the control of the manns . the company has recorded rental expense for the lease of this facility on an arm 's length basis . the rental expense for the lease of this facility in the amount of $ 311 thousand for the years ended december 31 , 2013 , 2012 , and 2011. in connection with the paulin acquisition , the company entered into three leases on february 19 , 2013 for five properties containing industrial warehouse , manufacturing plant , and office facilities . the owners of the properties under one lease are relatives of richard paulin , who is employed by the hillman group canada ulc

liquidity and capital resources cash flows the statements of cash flows reflect the changes in cash and cash equivalents for the years ended december 31 , 2013 , 2012 , and 2011 by classifying transactions into three major categories : operating , investing , and financing activities . operating activities net cash provided by operating activities for the year ended december 31 , 2013 of $ 41.5 million was generated by the net loss of $ 1.1 million adjusted for non-cash charges of $ 54.0 million for depreciation , amortization , dispositions of equipment , deferred taxes , deferred financing , stock-based compensation , and other non-cash interest which was partially offset by cash related adjustments of $ 12.5 million for routine operating activities represented by changes in inventories , accounts receivable , accounts payable , accrued liabilities , and other assets . in 2013 , routine operating activities used cash for an increase in inventories of $ 11.5 million , an increase in accounts receivable of $ 9.1 million and other assets of $ 4.1 million while operating activities provided cash from an increase in accounts payable of $ 8.4 million , an increase of accrued liabilities of $ 2.7 million and an increase in other items of $ 1.1 million . net cash provided by operating activities for the year ended december 31 , 2012 of $ 23.3 million was generated by the net loss of $ 7.2 million adjusted for non-cash charges of $ 33.3 million for depreciation , amortization , dispositions of equipment , deferred taxes , deferred financing , stock-based compensation , and other non-cash interest which was partially offset by cash related adjustments of $ 10.0 million for routine operating activities represented by changes in inventories , accounts receivable , accounts payable , accrued liabilities , and other assets .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```liquidity and capital resources cash flows the statements of cash flows reflect the changes in cash and cash equivalents for the years ended december 31 , 2013 , 2012 , and 2011 by classifying transactions into three major categories : operating , investing , and financing activities . operating activities net cash provided by operating activities for the year ended december 31 , 2013 of $ 41.5 million was generated by the net loss of $ 1.1 million adjusted for non-cash charges of $ 54.0 million for depreciation , amortization , dispositions of equipment , deferred taxes , deferred financing , stock-based compensation , and other non-cash interest which was partially offset by cash related adjustments of $ 12.5 million for routine operating activities represented by changes in inventories , accounts receivable , accounts payable , accrued liabilities , and other assets . in 2013 , routine operating activities used cash for an increase in inventories of $ 11.5 million , an increase in accounts receivable of $ 9.1 million and other assets of $ 4.1 million while operating activities provided cash from an increase in accounts payable of $ 8.4 million , an increase of accrued liabilities of $ 2.7 million and an increase in other items of $ 1.1 million . net cash provided by operating activities for the year ended december 31 , 2012 of $ 23.3 million was generated by the net loss of $ 7.2 million adjusted for non-cash charges of $ 33.3 million for depreciation , amortization , dispositions of equipment , deferred taxes , deferred financing , stock-based compensation , and other non-cash interest which was partially offset by cash related adjustments of $ 10.0 million for routine operating activities represented by changes in inventories , accounts receivable , accounts payable , accrued liabilities , and other assets . ``` Suspicious Activity Report : 21 merger transaction on may 28 , 2010 , hillman was acquired by affiliates of ohcp and certain members of hillman 's management and board of directors . pursuant to the terms and conditions of an agreement and plan of merger dated as of april 21 , 2010 , the company was merged with an affiliate of ohcp with the company surviving the merger transaction . as a result of the merger transaction , hillman is a wholly-owned subsidiary of holdco . the total consideration paid in the merger transaction was $ 832.7 million which includes $ 11.5 million for the quick tag license and related patents , repayment of outstanding debt , and the net value of the company 's outstanding junior subordinated debentures ( $ 105.4 million liquidation value , net of $ 3.3 million in trust common securities , at the time of the merger ) . financing arrangements on may 28 , 2010 , the company and certain of our subsidiaries closed on a $ 320.0 million senior secured first lien credit facility ( the “senior facilities” ) , consisting of a $ 290.0 million term loan and a $ 30.0 million revolving credit facility ( “revolver” ) . the term loan portion of the senior facilities had a six year term and the revolver had a five year term . the senior facilities provide borrowings at interest rates based on a eurodollar rate plus a margin of 3.75 % ( the “eurodollar margin” ) , or a base rate ( the “base rate” ) plus a margin of 2.75 % ( the “base rate margin” ) . the eurodollar rate was subject to a minimum floor of 1.75 % and the base rate was subject to a minimum floor of 2.75 % . concurrently with the merger transaction , hillman group issued $ 150.0 million aggregate principal amount of senior notes due 2018 ( the “10.875 % senior notes” ) . on march 16 , 2011 , hillman group completed an offering of $ 50.0 million aggregate principal amount of 10.875 % senior notes . hillman group received a premium of approximately $ 4.6 million on the $ 50.0 million 10.875 % senior notes offering . on december 21 , 2012 , hillman group completed an offering of $ 65.0 million aggregate principal amount of 10.875 % senior notes . hillman group received a premium of approximately $ 4.2 million on the $ 65.0 million 10.875 % senior notes offering . the 10.875 % senior notes are guaranteed by the hillman companies , inc. , hillman investment company , and all of the domestic subsidiaries of hillman group . hillman group pays interest on the 10.875 % senior notes semi-annually on june 1 and december 1 of each year . the senior facilities contain financial and operating covenants . these covenants require the company to maintain certain financial ratios , including a secured leverage ratio . these debt agreements provide for customary events of default , including , but not limited to , payment defaults , breach of representations or covenants , cross-defaults , bankruptcy events , failure to pay judgments , attachment of its assets , change of control , and the issuance of an order of dissolution . certain of these events of default are subject to notice and cure periods or materiality thresholds . the occurrence of an event of default permits the lenders under the senior facilities to accelerate repayment of all amounts due , terminate commitments , direct borrower to pay collateral agent additional cash collateral , and enforce any and all rights . the company pays interest to the trust on the junior subordinated debentures underlying the trust preferred securities at the rate of 11.6 % per annum on their face amount of $ 105.4 million , or $ 12.2 million per annum in the aggregate . the trust distributes an equivalent amount to the holders of the trust preferred securities . pursuant to the indenture that governs the trust preferred securities , the trust is able to defer distribution payments to holders of the trust preferred securities for a period that can not exceed 60 months ( the “deferral period” ) . during a deferral period , the company is required to accrue the full amount of all interest payable , and such deferred interest payable would become immediately payable by the company at the end of the deferral period . there were no deferrals of distribution payments to holders of the trust preferred securities in 2013 or 2012 . 22 effective april 18 , 2011 , the company completed an amendment to the credit agreement governing our senior facilities . the senior facilities amendment eliminated the total leverage and interest coverage covenants and reduced the secured leverage covenant to 4.75x with no future step downs . the term loan pricing was modified to reduce the eurodollar margin and the base rate margin by 25 basis points and reduce the floor on eurodollar and base rate loans by an additional 25 basis points . in connection with the amendment to the credit agreement , the company incurred loan discount costs of $ 1.25 million . as the modification of the senior facilities agreement was not substantial , the unamortized loan discount and debt issuance costs will be amortized over the term of the amended senior facilities . effective november 4 , 2011 , the company entered into a joinder agreement to our credit agreement under the existing senior facilities ( the “2011 incremental facility” ) . the 2011 incremental facility increased the aggregate term loan commitments available to hillman group under the senior facilities by $ 30.0 million . in connection with the 2011 incremental facility , the company incurred loan discount costs of approximately $ 0.8 million . as the modification of the senior facilities agreement was not substantial , the unamortized loan discount costs will be amortized over the term of the amended senior facilities . story_separator_special_tag year ended december 31 , 2012 and year ended december 31 , 2011 the effective income tax rates were 41.7 % and 32.4 % for the twelve month periods ended december 31 , 2012 and 2011 , respectively . the effective income tax rate differed from the federal statutory rate in the twelve month period ended december 31 , 2012 primarily due to a decrease in the reserve for unrecognized tax benefits . the effective income tax rate differed from the federal statutory rate in the twelve month period ended december 31 , 2011 primarily due to the increase in the valuation reserve recorded against certain deferred tax assets in addition to the effect of state rates . the effective income tax rate differed from the federal statutory rate in the twelve month periods ended december 31 , 2012 and 2011 due to the effect of foreign and state taxes . see note 6 , income taxes , of notes to consolidated financial statements for income taxes and disclosures related to 2012 and 2011 income tax events . 30 story_separator_special_tag font-family : times new roman ; font-size:10pt `` width= `` 100 % `` > ( 2 ) interest payments for long term senior term loans and the 10.875 % senior notes . interest payments on the variable rate long term senior term loans were calculated using the actual interest rate of 3.75 % as of december 31 , 2013. interest payments on the 10.875 % senior notes were calculated at their fixed rate . ( 3 ) all of the contractual obligations noted above are reflected on the company 's consolidated balance sheet as of december 31 , 2013 except for the interest payments , purchase obligations , and operating leases . the company has a purchase agreement with our supplier of key blanks which requires minimum purchases of 100 million key blanks per year . to the extent minimum purchases of key blanks are below 100 million , the company must pay the supplier $ .0035 per key multiplied by the shortfall . since the inception of the contract in 1998 , the company has purchased more than the requisite 100 million key blanks per year from the supplier . in 2013 , the company extended this contract for an additional three years . off-balance sheet arrangements the company does not have any off-balance sheet arrangements , as defined in item 303 ( a ) ( 4 ) ( ii ) of regulation s-k under the securities exchange act of 1934 , as amended . 33 borrowings as of december 31 , 2013 , the company had $ 26.1 million available under our secured credit facilities . the company had approximately $ 386.0 million of outstanding debt under our secured credit facilities at december 31 , 2013 , consisting of $ 385.4 million in term loans and $ 0.6 million in capitalized lease and other obligations . the term loans consisted of $ 385.4 million in term b-2 loans at a three month libor rate plus margin of 3.75 % . the capitalized lease and other obligations were at various interest rates . at december 31 , 2013 and 2012 , the company borrowings were as follows : replace_table_token_6_th descriptions of the company 's credit agreement governing the senior facilities , as amended , and the 10.875 % senior notes are contained in the “financing arrangements” section of this annual report on form 10-k. the company 's senior facilities require the maintenance of the secured leverage ratio described above and limit the ability of the company to incur debt , make investments , make dividend payments to holders of the trust preferred securities , or undertake certain other business activities . upon the occurrence of an event of default under the credit agreement , all amounts outstanding , together with accrued interest , could be declared immediately due and payable by our lenders . below are the calculations of the financial covenant , as amended on april 18 , 2011 , with the senior facilities requirement for the twelve months ended december 31 , 2013 : ( dollars in thousands ) actual ratio requirement secured leverage ratio senior term loan balance $ 385,399 revolver — capital leases and other credit obligations 556 total debt $ 385,955 adjusted ebitda ( 1 ) $ 127,240 leverage ratio ( must be below requirement ) 3.03 4.75 ( 1 ) adjusted ebitda is a non-gaap measure defined as income from operations ( $ 56,441 ) plus depreciation ( $ 24,796 ) , amortization ( $ 22,112 ) , stock compensation expense ( $ 9,006 ) , restructuring costs ( $ 4,382 ) , acquisition and integration expenses ( $ 8,638 ) , foreign exchange losses ( $ 2,252 ) , management fees ( $ 77 ) , and minus other ( $ 464 ) . 34 related party transactions the company has recorded management fee charges and expenses from ohcp of $ 77 thousand for the year ended december 31 , 2013 , $ 155 thousand for the year ended december 31 , 2012 , and $ 110 thousand for the year ended december 31 , 2011. gregory mann and gabrielle mann are employed by the all points subsidiary of hillman . all points leases an industrial warehouse and office facility from companies under the control of the manns . the company has recorded rental expense for the lease of this facility on an arm 's length basis . the rental expense for the lease of this facility in the amount of $ 311 thousand for the years ended december 31 , 2013 , 2012 , and 2011. in connection with the paulin acquisition , the company entered into three leases on february 19 , 2013 for five properties containing industrial warehouse , manufacturing plant , and office facilities . the owners of the properties under one lease are relatives of richard paulin , who is employed by the hillman group canada ulc

( cs ) . we provide our solutions through a software-as-a-service model , primarily with renewable annual subscriptions . these subscriptions require customers to pay a fee in order to access each of our cloud solutions . we generally invoice our customers for the entire subscription amount at the start of the subscription term , and the invoiced amounts are treated as deferred revenues and are recognized ratably over the term of each subscription . we continue to experience revenue growth from our existing customers as they renew and purchase additional subscriptions . we market and sell our solutions to enterprises , government entities and small and medium-sized businesses across a broad range of industries , including education , financial services , government , healthcare , insurance , manufacturing , media , retail , technology and utilities . in 2020 , 2019 and 2018 , approximately 63 % , 64 % and 67 % , respectively , of our revenues were derived from customers in the united states based on our customers billing address . we sell our solutions to enterprises and government entities primarily through our field sales force and to small and medium-sized businesses through our inside sales force . we generate a significant portion of sales through our channel partners , including managed service providers , value-added resellers and consulting firms in the united states and internationally . 40 impacts of covid-19 in march 2020 , the world health organization declared the outbreak of covid-19 as a pandemic . as a result of covid-19 , we have modified certain aspects of our business , including restricting employee travel , requiring employees to work from home , and canceling certain events and meetings , among other modifications . we will continue to actively monitor the situation and may take further actions that alter our business operations as may be required by federal , state or local authorities or that we determine are in the best interests of our employees , customers , partners , suppliers and stockholders . covid-19 has not had and is not expected to have a significant impact on our business in 2021. however , while we have not incurred significant disruptions from the covid-19 outbreak , we are unable to accurately predict the full impact that covid-19 will have due to numerous uncertainties , including the duration of the outbreak , actions that may be taken by governmental authorities and the impact to the business of our customers and partners . we will continue to evaluate the nature and extent of the impact to our business , financial position , results of operations and cash flows . key components of results of operations revenues we derive revenues from the sale of subscriptions to our security and compliance solutions , which are delivered on our cloud platform . subscriptions to our solutions allow customers to access our cloud-based security and compliance solutions through a unified , web-based interface . customers generally enter into one-year renewable subscriptions . the subscription fee entitles the customer to an unlimited number of scans for a specified number of devices or web applications and , if requested by a customer as part of their subscription , a specified number of physical or virtual scanner appliances . our physical and virtual scanner appliances are requested by certain customers as part of their subscriptions in order to scan it infrastructures within their firewalls and do not function without , and are not sold separately from , subscriptions for our solutions . in some limited cases , we also provide certain computer equipment used to extend our qualys cloud platform into our customers ' private cloud environment . customers are required to return physical scanner appliances and computer equipment if they do not renew their subscriptions . we typically invoice our customers for the entire subscription amount at the start of the subscription term . invoiced amounts are reflected on our consolidated balance sheets as accounts receivable or as cash when collected , and as deferred revenues until earned and recognized ratably over the subscription period . accordingly , deferred revenues represent the amount billed to customers that has not yet been earned or recognized as revenues , pursuant to subscriptions entered into in current and prior periods . cost of revenues cost of revenues consists primarily of personnel expenses , comprised of salaries , benefits , amortization of capitalized internal-use software , performance-based compensation and stock-based compensation , for employees who operate our data centers and provide support services to our customers . other expenses include depreciation of data center equipment and physical scanner appliances and computer hardware provided to certain customers as part of their subscriptions , expenses related to the use of third-party data centers , amortization of software and license fees , amortization of intangibles related to acquisitions , maintenance support , fees paid to contractors who supplement or support our operations center personnel and overhead allocations . we expect to continue to make capital investments to expand and support our data center operations , which will increase the cost of revenues in absolute dollars . operating expenses research and development research and development expenses consist primarily of personnel expenses , comprised of salaries , benefits , performance-based compensation and stock-based compensation , for our research and development teams . other expenses include third-party contractor fees , software and license fees , amortization of intangibles related to acquisitions and overhead allocations . 41 sales and marketing sales and marketing expenses consist primarily of personnel expenses , comprised of salaries , benefits , sales commissions , performance-based compensation and stock-based compensation for our worldwide sales and marketing teams . other expenses include marketing and promotional events , lead-generation marketing programs , public relations , travel , software licenses and overhead allocations . sales commissions related to new business and upsells are capitalized as an asset . story_separator_special_tag deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to tax benefit carry-forwards and to differences between the financial statement amounts of assets and liabilities and their respective tax basis . we regularly review our deferred tax assets for recoverability and establish a valuation allowance if it is more likely than not that some portion or all of the deferred tax assets will not be realized . to make this assessment , we take into account predictions of the amount and category of taxable income from available positive and negative evidence about these possible sources of taxable income . the weight given to the potential effect of negative and positive evidence is commensurate with the extent to which the strength of the evidence can be objectively verified . based on the analysis of positive and negative factors noted above , we believe it is more likely than not that our california deferred tax assets will not be realized because the income attributed to california is not expected to be sufficient to recognize these deferred tax assets . accordingly , we continue to record a valuation allowance as of december 31 , 2020 for our california deferred tax assets . if , in the future , we determine that these deferred tax assets are more likely than not to be realized , a release of all or part , of the related valuation allowance could result in an income tax benefit in the period such determination is made . w e do not have a valuation allowance against u.s. federal and certain other state deferred tax assets . we recognize an income tax expense or benefit with respect to uncertain tax positions in our financial statements that we judge is more likely than not to be sustained solely on its technical merits in a tax audit , including resolution of any related appeals or litigation processes . to make this judgment , we must interpret complex and sometimes ambiguous tax laws , regulations and administrative practices . if an income tax position meets the more likely than not recognition threshold , then we must measure the amount of the tax benefit to be recognized by determining the largest amount of tax benefit that has a greater than a 50 % likelihood of being realized upon effective settlement with a taxing authority that has full knowledge of all of the relevant facts . it is inherently difficult and subjective to estimate such amounts , as this requires us to determine the probability of various possible settlement outcomes . to determine if a tax position is effectively settled after a tax examination has been completed , we must also estimate the likelihood that another taxing authority could review the respective tax position . we must also determine when it is reasonably possible that the amount of unrecognized tax benefits will significantly increase or decrease in the 12 months after each fiscal year-end . these judgments are difficult because a taxing authority may change its behavior as a result of our disclosures in our financial statements . we must reevaluate our income tax positions on a quarterly basis to consider factors such as changes in facts or circumstances , changes in tax laws , effectively settled issues under audit , the potential for interest and penalties , and new audit activity . such a change in recognition or measurement would result in recognition of a tax benefit or an additional charge to the tax provision . 49 stock-based compensation we recognize the fair value of our employee stock options and restricted stock units over the requisite service period for those awards ultimately expected to vest . the fair value of each option is estimated on date of grant using the black-scholes-merton option pricing model and the fair value of each restricted stock unit is based on the fair value of our stock on the date of grant . forfeitures are estimated on the date of grant and revised if actual or expected forfeiture activity differs materially from original estimates . for performance-based non-qualified stock options and restricted stock units , we recognize compensation costs when it is probable that the performance conditions will be met . we assess these conditions on a quarterly basis . determining the appropriate fair value model and calculating the fair value of employee stock options requires the use of highly subjective assumptions , including the expected life of the stock option and stock price volatility . the assumptions used in calculating the fair value of employee stock options represent management 's best estimates , but the estimates involve inherent uncertainties and the application of management 's judgment . as a result , if factors change and we use different assumptions , our stock-based compensation expense could be materially different in the future . fair value measurement fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date . for certain of our financial instruments , including cash and certain cash equivalents , accounts receivable , accounts payable and accrued liabilities , the carrying amounts approximate their fair value due to the relatively short maturity of these balances . we measure and report certain cash equivalents , marketable securities and derivative foreign currency forward contracts at fair value in accordance with the provisions of the authoritative accounting guidance that addresses fair value measurements . this guidance establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available . the hierarchy is broken down into three levels based on the reliability of inputs as follows : level 1 - valuations based on quoted prices in active markets for identical assets or liabilities . level 2 - valuations based on other than

liquidity and capital resources at december 31 , 2020 , our principal source of liquidity was cash , cash equivalents and marketable securities of $ 454.5 million , including $ 30.7 million of cash held outside of the united states . we do not anticipate that we will need funds generated from foreign operations to fund our domestic operations . however , if we repatriate these funds , we could be subject to foreign withholding taxes . we generated positive cash flows from operations during the years ended december 31 , 2020 and 2019. we believe our existing cash , cash equivalents , marketable securities and cash from operations will be sufficient to fund our operations for at least the next twel ve months . in 2021 , we expect capital expenditures to be in a range of $ 30.0 million to $ 35.0 million . our future capital requirements will depend on many factors , including our rate of revenue growth , the expansion of our sales and marketing activities , the timing , type and extent of our spending on research and development efforts , international expansion and investment in data centers . we may also seek to invest in or acquire complementary businesses or technologies . while the covid-19 pandemic has not had a material adverse financial impact on our operations to date , the future impact of the pandemic can not be predicted with certainty and may increase our costs of capital and otherwise adversely affect our business , result of operations , financial condition and liquidity .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```liquidity and capital resources at december 31 , 2020 , our principal source of liquidity was cash , cash equivalents and marketable securities of $ 454.5 million , including $ 30.7 million of cash held outside of the united states . we do not anticipate that we will need funds generated from foreign operations to fund our domestic operations . however , if we repatriate these funds , we could be subject to foreign withholding taxes . we generated positive cash flows from operations during the years ended december 31 , 2020 and 2019. we believe our existing cash , cash equivalents , marketable securities and cash from operations will be sufficient to fund our operations for at least the next twel ve months . in 2021 , we expect capital expenditures to be in a range of $ 30.0 million to $ 35.0 million . our future capital requirements will depend on many factors , including our rate of revenue growth , the expansion of our sales and marketing activities , the timing , type and extent of our spending on research and development efforts , international expansion and investment in data centers . we may also seek to invest in or acquire complementary businesses or technologies . while the covid-19 pandemic has not had a material adverse financial impact on our operations to date , the future impact of the pandemic can not be predicted with certainty and may increase our costs of capital and otherwise adversely affect our business , result of operations , financial condition and liquidity . ``` Suspicious Activity Report : ( cs ) . we provide our solutions through a software-as-a-service model , primarily with renewable annual subscriptions . these subscriptions require customers to pay a fee in order to access each of our cloud solutions . we generally invoice our customers for the entire subscription amount at the start of the subscription term , and the invoiced amounts are treated as deferred revenues and are recognized ratably over the term of each subscription . we continue to experience revenue growth from our existing customers as they renew and purchase additional subscriptions . we market and sell our solutions to enterprises , government entities and small and medium-sized businesses across a broad range of industries , including education , financial services , government , healthcare , insurance , manufacturing , media , retail , technology and utilities . in 2020 , 2019 and 2018 , approximately 63 % , 64 % and 67 % , respectively , of our revenues were derived from customers in the united states based on our customers billing address . we sell our solutions to enterprises and government entities primarily through our field sales force and to small and medium-sized businesses through our inside sales force . we generate a significant portion of sales through our channel partners , including managed service providers , value-added resellers and consulting firms in the united states and internationally . 40 impacts of covid-19 in march 2020 , the world health organization declared the outbreak of covid-19 as a pandemic . as a result of covid-19 , we have modified certain aspects of our business , including restricting employee travel , requiring employees to work from home , and canceling certain events and meetings , among other modifications . we will continue to actively monitor the situation and may take further actions that alter our business operations as may be required by federal , state or local authorities or that we determine are in the best interests of our employees , customers , partners , suppliers and stockholders . covid-19 has not had and is not expected to have a significant impact on our business in 2021. however , while we have not incurred significant disruptions from the covid-19 outbreak , we are unable to accurately predict the full impact that covid-19 will have due to numerous uncertainties , including the duration of the outbreak , actions that may be taken by governmental authorities and the impact to the business of our customers and partners . we will continue to evaluate the nature and extent of the impact to our business , financial position , results of operations and cash flows . key components of results of operations revenues we derive revenues from the sale of subscriptions to our security and compliance solutions , which are delivered on our cloud platform . subscriptions to our solutions allow customers to access our cloud-based security and compliance solutions through a unified , web-based interface . customers generally enter into one-year renewable subscriptions . the subscription fee entitles the customer to an unlimited number of scans for a specified number of devices or web applications and , if requested by a customer as part of their subscription , a specified number of physical or virtual scanner appliances . our physical and virtual scanner appliances are requested by certain customers as part of their subscriptions in order to scan it infrastructures within their firewalls and do not function without , and are not sold separately from , subscriptions for our solutions . in some limited cases , we also provide certain computer equipment used to extend our qualys cloud platform into our customers ' private cloud environment . customers are required to return physical scanner appliances and computer equipment if they do not renew their subscriptions . we typically invoice our customers for the entire subscription amount at the start of the subscription term . invoiced amounts are reflected on our consolidated balance sheets as accounts receivable or as cash when collected , and as deferred revenues until earned and recognized ratably over the subscription period . accordingly , deferred revenues represent the amount billed to customers that has not yet been earned or recognized as revenues , pursuant to subscriptions entered into in current and prior periods . cost of revenues cost of revenues consists primarily of personnel expenses , comprised of salaries , benefits , amortization of capitalized internal-use software , performance-based compensation and stock-based compensation , for employees who operate our data centers and provide support services to our customers . other expenses include depreciation of data center equipment and physical scanner appliances and computer hardware provided to certain customers as part of their subscriptions , expenses related to the use of third-party data centers , amortization of software and license fees , amortization of intangibles related to acquisitions , maintenance support , fees paid to contractors who supplement or support our operations center personnel and overhead allocations . we expect to continue to make capital investments to expand and support our data center operations , which will increase the cost of revenues in absolute dollars . operating expenses research and development research and development expenses consist primarily of personnel expenses , comprised of salaries , benefits , performance-based compensation and stock-based compensation , for our research and development teams . other expenses include third-party contractor fees , software and license fees , amortization of intangibles related to acquisitions and overhead allocations . 41 sales and marketing sales and marketing expenses consist primarily of personnel expenses , comprised of salaries , benefits , sales commissions , performance-based compensation and stock-based compensation for our worldwide sales and marketing teams . other expenses include marketing and promotional events , lead-generation marketing programs , public relations , travel , software licenses and overhead allocations . sales commissions related to new business and upsells are capitalized as an asset . story_separator_special_tag deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to tax benefit carry-forwards and to differences between the financial statement amounts of assets and liabilities and their respective tax basis . we regularly review our deferred tax assets for recoverability and establish a valuation allowance if it is more likely than not that some portion or all of the deferred tax assets will not be realized . to make this assessment , we take into account predictions of the amount and category of taxable income from available positive and negative evidence about these possible sources of taxable income . the weight given to the potential effect of negative and positive evidence is commensurate with the extent to which the strength of the evidence can be objectively verified . based on the analysis of positive and negative factors noted above , we believe it is more likely than not that our california deferred tax assets will not be realized because the income attributed to california is not expected to be sufficient to recognize these deferred tax assets . accordingly , we continue to record a valuation allowance as of december 31 , 2020 for our california deferred tax assets . if , in the future , we determine that these deferred tax assets are more likely than not to be realized , a release of all or part , of the related valuation allowance could result in an income tax benefit in the period such determination is made . w e do not have a valuation allowance against u.s. federal and certain other state deferred tax assets . we recognize an income tax expense or benefit with respect to uncertain tax positions in our financial statements that we judge is more likely than not to be sustained solely on its technical merits in a tax audit , including resolution of any related appeals or litigation processes . to make this judgment , we must interpret complex and sometimes ambiguous tax laws , regulations and administrative practices . if an income tax position meets the more likely than not recognition threshold , then we must measure the amount of the tax benefit to be recognized by determining the largest amount of tax benefit that has a greater than a 50 % likelihood of being realized upon effective settlement with a taxing authority that has full knowledge of all of the relevant facts . it is inherently difficult and subjective to estimate such amounts , as this requires us to determine the probability of various possible settlement outcomes . to determine if a tax position is effectively settled after a tax examination has been completed , we must also estimate the likelihood that another taxing authority could review the respective tax position . we must also determine when it is reasonably possible that the amount of unrecognized tax benefits will significantly increase or decrease in the 12 months after each fiscal year-end . these judgments are difficult because a taxing authority may change its behavior as a result of our disclosures in our financial statements . we must reevaluate our income tax positions on a quarterly basis to consider factors such as changes in facts or circumstances , changes in tax laws , effectively settled issues under audit , the potential for interest and penalties , and new audit activity . such a change in recognition or measurement would result in recognition of a tax benefit or an additional charge to the tax provision . 49 stock-based compensation we recognize the fair value of our employee stock options and restricted stock units over the requisite service period for those awards ultimately expected to vest . the fair value of each option is estimated on date of grant using the black-scholes-merton option pricing model and the fair value of each restricted stock unit is based on the fair value of our stock on the date of grant . forfeitures are estimated on the date of grant and revised if actual or expected forfeiture activity differs materially from original estimates . for performance-based non-qualified stock options and restricted stock units , we recognize compensation costs when it is probable that the performance conditions will be met . we assess these conditions on a quarterly basis . determining the appropriate fair value model and calculating the fair value of employee stock options requires the use of highly subjective assumptions , including the expected life of the stock option and stock price volatility . the assumptions used in calculating the fair value of employee stock options represent management 's best estimates , but the estimates involve inherent uncertainties and the application of management 's judgment . as a result , if factors change and we use different assumptions , our stock-based compensation expense could be materially different in the future . fair value measurement fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date . for certain of our financial instruments , including cash and certain cash equivalents , accounts receivable , accounts payable and accrued liabilities , the carrying amounts approximate their fair value due to the relatively short maturity of these balances . we measure and report certain cash equivalents , marketable securities and derivative foreign currency forward contracts at fair value in accordance with the provisions of the authoritative accounting guidance that addresses fair value measurements . this guidance establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available . the hierarchy is broken down into three levels based on the reliability of inputs as follows : level 1 - valuations based on quoted prices in active markets for identical assets or liabilities . level 2 - valuations based on other than

these costs relate primarily to third-party advisory and consulting services , retention payments to certain employees , incremental stock-based compensation and other costs directly related to the separation . costs related to employees for retention or stock-based compensation are classified on a basis consistent with their regular compensation charges and included within cost of net revenues , sales and marketing , product development or general and administrative in our consolidated statement of income as applicable . costs other than those paid to employees are included within general and administrative in our consolidated statement of income . during 2014 , we incurred approximately $ 35 million related to separation costs . we expect to continue to incur additional separation costs in 2015 until we complete the separation of our paypal business . we currently estimate that such additional separation costs will exceed $ 250 million , although that estimate is subject to a number of assumptions and uncertainties . in 2014 , net revenues increased 12 % to $ 17.9 billion compared to $ 16.0 billion in 2013 , driven primarily by increases in net revenues from each of our business segments . we achieved an operating margin of 20 % in 2014 compared to 21 % in 2013 . our diluted earnings per share decreased to $ 0.04 in 2014 , a $ 2.14 decrease per share compared to 2013 , driven primarily by the accrual of deferred taxes on $ 9.0 billion of undistributed foreign earnings for 2013 and prior years , partially offset by growth in net revenues and a lower share count . we generated cash flow from operations of approximately $ 5.7 billion in 2014 compared to $ 5.0 billion in 2013 . 48 our marketplaces segment total net revenues increased $ 533 million , or 6 % , in 2014 compared to 2013 . the increase in total net revenues was driven primarily by an increase in gross merchandise volume ( gmv ) ( as defined below ) of 9 % , which was due to continued growth internationally and in the u.s. and a favorable impact from foreign currency movements relative to the u.s. dollar . we believe that during 2014 , gmv was negatively impacted by declines in volume caused by lower organic traffic and our second quarter cyberattack described below . our marketplaces segment operating margin decreased 2.7 percentage points in 2014 compared to 2013 due primarily to continued investments in our marketing programs , site operations and business initiatives . as previously disclosed , during the second quarter of 2014 , our marketplaces segment experienced a cyberattack that compromised an authentication database containing user names , encrypted passwords and other non-financial data of our customers . the attack resulted from a small number of employee log-in credentials that were compromised . the database included ebay marketplaces customers ' name , encrypted password , e-mail address , physical address , phone number and date of birth . the database did not contain any financial information or other confidential personal information . as a result of this attack we generally required marketplaces users to reset their passwords in order to access their accounts on our core marketplaces platform and its localized counterparts . this attack was isolated to our ebay platform and we have seen no evidence of unauthorized access or compromises to personal or financial information of our paypal users , as that data is stored separately on a secure network . during 2014 , we recorded cyberattack-related expenses and customer credits of approximately $ 46 million , of which approximately $ 41 million have been reported within our marketplaces segment . expenses include costs to investigate and remediate the attack , provide additional customer support and temporarily enhance customer protection as well as additional marketing program costs . customer credits were voluntarily offered as refunds to sellers during the password reset period and were recorded as a reduction of revenue . many of these measures were undertaken to preserve our customers ' trust in our marketplaces businesses . the disruption arising from this cyberattack adversely affected our 2014 marketplaces segment results ; however , it is not possible to precisely measure the amount of lost revenue directly attributable to the cyberattack . we are unable to predict the full impact of the cyberattack on marketplaces users ' behavior in the future , including whether a change in our customers ' trust could negatively impact our marketplaces segment 's results of operations on an ongoing basis or require us to increase promotional efforts to regain such trust . accordingly , we are not able to precisely forecast any possible future impact to our revenues or expenses attributable to the cyberattack . our payments segment total net revenues increased $ 1.3 billion , or 19 % , in 2014 compared to 2013 . the increase in total net revenues was driven primarily by an increase in net total payment volume ( tpv ) ( as defined below ) of 27 % . our payments segment operating margin decreased 0.7 percentage points in 2014 compared to 2013 , due primarily to increased investment in our marketing programs and product development partially offset by a favorable transaction expense rate . our enterprise segment total net revenues increased $ 72 million , or 6 % , in 2014 compared to 2013 . the increase in total net revenues was driven primarily by an increase in gross merchandise sales ( as defined below ) of 13 % in 2014 compared to 2013 . our enterprise segment operating margin was relatively consistent for 2014 compared to 2013 , increasing 0.5 percentage points . in 2013 , net revenues increased 14 % to $ 16.0 billion compared to $ 14.1 billion in 2012 , driven primarily by increases in net revenues from each of our business segments . story_separator_special_tag payments payments cost of net revenues increased $ 437 million , or 16 % , in 2014 compared to 2013 due primarily to the impact of growth in net tpv offset in part by favorable transaction expense rates . payments cost of net revenues as a percentage of payments net revenues decreased by 1.0 percentage points during 2014 compared to 2013 due to favorable transaction expense rates . payments cost of net revenues increased $ 466 million , or 21 % , in 2013 compared to 2012 due primarily to the impact of growth in net tpv and growth in costs related to our customer support initiatives . payments cost of net revenues as a percentage of payments net revenues increased by 0.8 percentage points during 2013 compared to 2012 due primarily to these same factors . enterprise enterprise cost of net revenues increased $ 89 million , or 11 % , during 2014 compared to 2013 due primarily to the impact of growth in gross merchandise sales . enterprise cost of net revenues as a percentage of enterprise net revenues increased by 3.1 percentage points during 2014 compared to 2013 due primarily to a lower take rate . enterprise cost of net revenues increased $ 126 million , or 18 % , during 2013 compared to 2012 due primarily to the impact of growth in gross merchandise sales as well as amortization expense driven by the initial roll out of the new suite of commerce technologies . enterprise cost of net revenues as a percentage of enterprise net revenues increased by 8.3 percentage points during 2013 compared to 2012 due primarily to these same factors . summary of operating expenses , non-operating items and provision for income taxes the following table summarizes changes in operating expenses , non-operating items and provision for income taxes for the periods presented : replace_table_token_10_th 55 the following table summarizes operating expenses , non-operating items and provision for income taxes as a percentage of net revenues for the periods presented : replace_table_token_11_th sales and marketing sales and marketing expenses consist primarily of advertising costs and marketing programs ( both online and offline ) , employee compensation , contractor costs , facilities costs and depreciation on equipment . online marketing expenses represent traffic acquisition costs in various channels such as paid search , affiliates marketing and display advertising . offline advertising includes brand campaigns , buyer/seller communications and general public relations expenses . sales and marketing expense increased by $ 527 million , or 17 % , in 2014 compared to 2013 . the increase in sales and marketing expense was due primarily to an increase in marketing program costs ( both online and offline programs ) , ebay 's and paypal 's brand campaigns and higher employee-related expenses ( including consultant costs ) . sales and marketing expense as a percentage of net revenues were 20 % and 19 % in 2014 and 2013 , respectively . sales and marketing expense increased by $ 147 million , or 5 % , in 2013 compared to 2012. the increase in sales and marketing expense was due primarily to higher employee-related expenses ( including consultant costs , facility costs and equipment-related costs ) , partially offset by a decrease in professional services fees and marketing program efficiencies . the decrease in marketing program costs was due primarily to a shift in focus from customer acquisition to customer retention ( for which certain associated expenses are recorded as a reduction in revenue instead of sales and marketing expense ) . sales and marketing expense as a percentage of net revenues were 19 % and 21 % in 2013 and 2012 , respectively . product development product development expenses consist primarily of employee compensation , contractor costs , facilities costs and depreciation on equipment . product development expenses are net of required capitalization of major site and other product development efforts , including the development of our next generation platform architecture , migration of certain platforms , seller tools and payments services projects . our top technology priorities include mobile , user experience , search , platform and products . capitalized internal use and website development costs were $ 395 million and $ 375 million in 2014 and 2013 , respectively , and are primarily reflected as a cost of net revenues when amortized in future periods . product development expenses increased by $ 232 million , or 13 % , in 2014 compared to 2013 . the increase was due primarily to higher employee-related costs ( including consultant costs ) driven by increased investment in platform and mobile . product development expenses as a net percentage of revenues were 11 % in both 2014 and 2013 . product development expenses increased by $ 195 million , or 12 % , in 2013 compared to 2012. the increase was due primarily to higher employee-related costs ( including consultant costs , facility costs and equipment-related costs ) driven by increased investment in platform , search , mobile and offline , as well as an increase in professional service fees . product development expenses as a net percentage of revenues were 11 % in both 2013 and 2012 . 56 general and administrative general and administrative expenses consist primarily of employee compensation , contractor costs , facilities costs , depreciation of equipment , employer payroll taxes on employee stock-based compensation , legal expenses , restructuring , insurance premiums and professional fees . our legal expenses , including those related to various ongoing legal proceedings , may fluctuate substantially from period to period . general and administrative expenses increased $ 140 million , or 8 % , in 2014 compared to 2013 . the increase was due primarily to higher employee-related costs and costs related to our planned separation of our paypal business . general and administrative expenses as a percentage of net revenues were 10 % in 2014 and 11 % in 2013 . general and administrative expenses increased $

cash flows replace_table_token_12_th 59 operating activities we generated cash from operating activities of $ 5.7 billion , $ 5.0 billion and $ 3.8 billion in 2014 , 2013 and 2012 , respectively . the net cash provided by operating activities of $ 5.7 billion in 2014 was due primarily to net income of $ 46 million with adjustments of $ 2.8 billion in deferred income taxes , $ 1.5 billion in depreciation and amortization , $ 958 million in provision for transaction and loan losses and $ 675 million in stock-based compensation expense and a decrease of $ 185 million in changes in assets and liabilities , net of acquisition effects . the net cash provided by operating activities of $ 5.0 billion in 2013 was due primarily to net income of $ 2.9 billion with adjustments of $ 1.4 billion in depreciation and amortization , $ 791 million in provision for transaction and loan losses , $ 609 million in stock-based compensation expense and a decrease of $ 354 million in changes in assets and liabilities , net of acquisition effects and a $ 75 million gain on the sale of equity investments and $ 31 million in deferred income taxes . the net cash provided by operating activities of $ 3.8 billion in 2012 was due primarily to net income of $ 2.6 billion with adjustments of $ 1.2 billion in depreciation and amortization , $ 580 million in provision for transaction and loan losses , $ 488 million in stock-based compensation expense and a decrease of $ 756 million in changes in assets and liabilities and $ 35 million in deferred income taxes . cash paid for income taxes in 2014 , 2013 and 2012 was $ 343 million , $ 466 million and $ 789 million , respectively .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```cash flows replace_table_token_12_th 59 operating activities we generated cash from operating activities of $ 5.7 billion , $ 5.0 billion and $ 3.8 billion in 2014 , 2013 and 2012 , respectively . the net cash provided by operating activities of $ 5.7 billion in 2014 was due primarily to net income of $ 46 million with adjustments of $ 2.8 billion in deferred income taxes , $ 1.5 billion in depreciation and amortization , $ 958 million in provision for transaction and loan losses and $ 675 million in stock-based compensation expense and a decrease of $ 185 million in changes in assets and liabilities , net of acquisition effects . the net cash provided by operating activities of $ 5.0 billion in 2013 was due primarily to net income of $ 2.9 billion with adjustments of $ 1.4 billion in depreciation and amortization , $ 791 million in provision for transaction and loan losses , $ 609 million in stock-based compensation expense and a decrease of $ 354 million in changes in assets and liabilities , net of acquisition effects and a $ 75 million gain on the sale of equity investments and $ 31 million in deferred income taxes . the net cash provided by operating activities of $ 3.8 billion in 2012 was due primarily to net income of $ 2.6 billion with adjustments of $ 1.2 billion in depreciation and amortization , $ 580 million in provision for transaction and loan losses , $ 488 million in stock-based compensation expense and a decrease of $ 756 million in changes in assets and liabilities and $ 35 million in deferred income taxes . cash paid for income taxes in 2014 , 2013 and 2012 was $ 343 million , $ 466 million and $ 789 million , respectively . ``` Suspicious Activity Report : these costs relate primarily to third-party advisory and consulting services , retention payments to certain employees , incremental stock-based compensation and other costs directly related to the separation . costs related to employees for retention or stock-based compensation are classified on a basis consistent with their regular compensation charges and included within cost of net revenues , sales and marketing , product development or general and administrative in our consolidated statement of income as applicable . costs other than those paid to employees are included within general and administrative in our consolidated statement of income . during 2014 , we incurred approximately $ 35 million related to separation costs . we expect to continue to incur additional separation costs in 2015 until we complete the separation of our paypal business . we currently estimate that such additional separation costs will exceed $ 250 million , although that estimate is subject to a number of assumptions and uncertainties . in 2014 , net revenues increased 12 % to $ 17.9 billion compared to $ 16.0 billion in 2013 , driven primarily by increases in net revenues from each of our business segments . we achieved an operating margin of 20 % in 2014 compared to 21 % in 2013 . our diluted earnings per share decreased to $ 0.04 in 2014 , a $ 2.14 decrease per share compared to 2013 , driven primarily by the accrual of deferred taxes on $ 9.0 billion of undistributed foreign earnings for 2013 and prior years , partially offset by growth in net revenues and a lower share count . we generated cash flow from operations of approximately $ 5.7 billion in 2014 compared to $ 5.0 billion in 2013 . 48 our marketplaces segment total net revenues increased $ 533 million , or 6 % , in 2014 compared to 2013 . the increase in total net revenues was driven primarily by an increase in gross merchandise volume ( gmv ) ( as defined below ) of 9 % , which was due to continued growth internationally and in the u.s. and a favorable impact from foreign currency movements relative to the u.s. dollar . we believe that during 2014 , gmv was negatively impacted by declines in volume caused by lower organic traffic and our second quarter cyberattack described below . our marketplaces segment operating margin decreased 2.7 percentage points in 2014 compared to 2013 due primarily to continued investments in our marketing programs , site operations and business initiatives . as previously disclosed , during the second quarter of 2014 , our marketplaces segment experienced a cyberattack that compromised an authentication database containing user names , encrypted passwords and other non-financial data of our customers . the attack resulted from a small number of employee log-in credentials that were compromised . the database included ebay marketplaces customers ' name , encrypted password , e-mail address , physical address , phone number and date of birth . the database did not contain any financial information or other confidential personal information . as a result of this attack we generally required marketplaces users to reset their passwords in order to access their accounts on our core marketplaces platform and its localized counterparts . this attack was isolated to our ebay platform and we have seen no evidence of unauthorized access or compromises to personal or financial information of our paypal users , as that data is stored separately on a secure network . during 2014 , we recorded cyberattack-related expenses and customer credits of approximately $ 46 million , of which approximately $ 41 million have been reported within our marketplaces segment . expenses include costs to investigate and remediate the attack , provide additional customer support and temporarily enhance customer protection as well as additional marketing program costs . customer credits were voluntarily offered as refunds to sellers during the password reset period and were recorded as a reduction of revenue . many of these measures were undertaken to preserve our customers ' trust in our marketplaces businesses . the disruption arising from this cyberattack adversely affected our 2014 marketplaces segment results ; however , it is not possible to precisely measure the amount of lost revenue directly attributable to the cyberattack . we are unable to predict the full impact of the cyberattack on marketplaces users ' behavior in the future , including whether a change in our customers ' trust could negatively impact our marketplaces segment 's results of operations on an ongoing basis or require us to increase promotional efforts to regain such trust . accordingly , we are not able to precisely forecast any possible future impact to our revenues or expenses attributable to the cyberattack . our payments segment total net revenues increased $ 1.3 billion , or 19 % , in 2014 compared to 2013 . the increase in total net revenues was driven primarily by an increase in net total payment volume ( tpv ) ( as defined below ) of 27 % . our payments segment operating margin decreased 0.7 percentage points in 2014 compared to 2013 , due primarily to increased investment in our marketing programs and product development partially offset by a favorable transaction expense rate . our enterprise segment total net revenues increased $ 72 million , or 6 % , in 2014 compared to 2013 . the increase in total net revenues was driven primarily by an increase in gross merchandise sales ( as defined below ) of 13 % in 2014 compared to 2013 . our enterprise segment operating margin was relatively consistent for 2014 compared to 2013 , increasing 0.5 percentage points . in 2013 , net revenues increased 14 % to $ 16.0 billion compared to $ 14.1 billion in 2012 , driven primarily by increases in net revenues from each of our business segments . story_separator_special_tag payments payments cost of net revenues increased $ 437 million , or 16 % , in 2014 compared to 2013 due primarily to the impact of growth in net tpv offset in part by favorable transaction expense rates . payments cost of net revenues as a percentage of payments net revenues decreased by 1.0 percentage points during 2014 compared to 2013 due to favorable transaction expense rates . payments cost of net revenues increased $ 466 million , or 21 % , in 2013 compared to 2012 due primarily to the impact of growth in net tpv and growth in costs related to our customer support initiatives . payments cost of net revenues as a percentage of payments net revenues increased by 0.8 percentage points during 2013 compared to 2012 due primarily to these same factors . enterprise enterprise cost of net revenues increased $ 89 million , or 11 % , during 2014 compared to 2013 due primarily to the impact of growth in gross merchandise sales . enterprise cost of net revenues as a percentage of enterprise net revenues increased by 3.1 percentage points during 2014 compared to 2013 due primarily to a lower take rate . enterprise cost of net revenues increased $ 126 million , or 18 % , during 2013 compared to 2012 due primarily to the impact of growth in gross merchandise sales as well as amortization expense driven by the initial roll out of the new suite of commerce technologies . enterprise cost of net revenues as a percentage of enterprise net revenues increased by 8.3 percentage points during 2013 compared to 2012 due primarily to these same factors . summary of operating expenses , non-operating items and provision for income taxes the following table summarizes changes in operating expenses , non-operating items and provision for income taxes for the periods presented : replace_table_token_10_th 55 the following table summarizes operating expenses , non-operating items and provision for income taxes as a percentage of net revenues for the periods presented : replace_table_token_11_th sales and marketing sales and marketing expenses consist primarily of advertising costs and marketing programs ( both online and offline ) , employee compensation , contractor costs , facilities costs and depreciation on equipment . online marketing expenses represent traffic acquisition costs in various channels such as paid search , affiliates marketing and display advertising . offline advertising includes brand campaigns , buyer/seller communications and general public relations expenses . sales and marketing expense increased by $ 527 million , or 17 % , in 2014 compared to 2013 . the increase in sales and marketing expense was due primarily to an increase in marketing program costs ( both online and offline programs ) , ebay 's and paypal 's brand campaigns and higher employee-related expenses ( including consultant costs ) . sales and marketing expense as a percentage of net revenues were 20 % and 19 % in 2014 and 2013 , respectively . sales and marketing expense increased by $ 147 million , or 5 % , in 2013 compared to 2012. the increase in sales and marketing expense was due primarily to higher employee-related expenses ( including consultant costs , facility costs and equipment-related costs ) , partially offset by a decrease in professional services fees and marketing program efficiencies . the decrease in marketing program costs was due primarily to a shift in focus from customer acquisition to customer retention ( for which certain associated expenses are recorded as a reduction in revenue instead of sales and marketing expense ) . sales and marketing expense as a percentage of net revenues were 19 % and 21 % in 2013 and 2012 , respectively . product development product development expenses consist primarily of employee compensation , contractor costs , facilities costs and depreciation on equipment . product development expenses are net of required capitalization of major site and other product development efforts , including the development of our next generation platform architecture , migration of certain platforms , seller tools and payments services projects . our top technology priorities include mobile , user experience , search , platform and products . capitalized internal use and website development costs were $ 395 million and $ 375 million in 2014 and 2013 , respectively , and are primarily reflected as a cost of net revenues when amortized in future periods . product development expenses increased by $ 232 million , or 13 % , in 2014 compared to 2013 . the increase was due primarily to higher employee-related costs ( including consultant costs ) driven by increased investment in platform and mobile . product development expenses as a net percentage of revenues were 11 % in both 2014 and 2013 . product development expenses increased by $ 195 million , or 12 % , in 2013 compared to 2012. the increase was due primarily to higher employee-related costs ( including consultant costs , facility costs and equipment-related costs ) driven by increased investment in platform , search , mobile and offline , as well as an increase in professional service fees . product development expenses as a net percentage of revenues were 11 % in both 2013 and 2012 . 56 general and administrative general and administrative expenses consist primarily of employee compensation , contractor costs , facilities costs , depreciation of equipment , employer payroll taxes on employee stock-based compensation , legal expenses , restructuring , insurance premiums and professional fees . our legal expenses , including those related to various ongoing legal proceedings , may fluctuate substantially from period to period . general and administrative expenses increased $ 140 million , or 8 % , in 2014 compared to 2013 . the increase was due primarily to higher employee-related costs and costs related to our planned separation of our paypal business . general and administrative expenses as a percentage of net revenues were 10 % in 2014 and 11 % in 2013 . general and administrative expenses increased $

although the north america rig count had improved by the end of 2018 it still remained almost 50 % below 2014 levels . the build in levels of activities on development projects and producing fields in the u.s. unconventional reservoirs during 2017 continued to strengthen during most of 2018 , until october 2018 when the commodity price weakened significantly and activity levels decreased . outside of north america , activities associated with the exploration for and production of oil dropped to current lower levels during the industry downturn which began at the end of 2014 and remained relatively flat during 2017 and 2018. our clients ' activities in the international and deepwater markets remained at these lower levels in 2017 and 2018 , and although activities have not yet increased , we believe these markets have shown signs of recovery for 2019 and beyond as our clients have announced new capital investment projects throughout 2017 and 2018. results of operations operating results for the year ended december 31 , 2018 compared to the years ended december 31 , 2017 and 2016 we evaluate our operating results by analyzing revenue , operating income and operating income margin ( defined as operating income divided by total revenue ) . since we have a relatively fixed cost structure , increases in revenue generally translate into higher operating income results . results for the years ended december 31 , 2018 , 2017 and 2016 are summarized in the following chart : 19 results of operations as a percentage of applicable revenue for the years ended december 31 , 2018 , 2017 and 2016 are as follows ( in thousands , except for per share information ) : replace_table_token_3_th services revenue services revenue , which is tied more to activities associated with the exploration and production of oil and gas outside the u.s. , increased 1.4 % to $ 486.8 million in 2018 from $ 480.3 million in 2017 which increased 2.5 % from $ 468.4 million in 2016 . the increase in revenue was driven by a stronger u.s. market for most of 2018 , which was partially offset by a weaker market outside the u.s. crude oil prices continued to strengthen throughout 2018 until early october when crude oil prices peaked and decreased over 40 % by december 2018. the improvement in crude oil prices continued to support elevated activity levels in the u.s. onshore market for most of 2018 , however activities outside the u.s. have remained flat . although our clients have announced final investment decisions ( `` fids `` ) for several projects outside the u.s. and in offshore environments , significant activity on these projects did not start in 2018 and wells must be drilled and or completed , stimulated , cored and have reservoir fluid samples collected , before we see a revenue opportunity . we continue our focus on worldwide crude oil related projects , including those related to the development of fields in onshore and offshore north america , offshore south america , offshore europe and africa , the middle east , and asia pacific regions . product sales revenue product sales revenue , which is tied more to the completion of wells in north america , increased 28 % to $ 214.0 million in 2018 from $ 167.6 million in 2017 and increased 38 % from $ 121.8 million in 2016 . the 28 % increase in product sales revenue 20 in 2018 compared to 2017 outpaced the 13 % increase in rig count and the 25 % increase in the completion of wells due to our differentiated well completion product sales surpassing the industry activity levels in north america . cost of services , excluding depreciation cost of services increased to $ 343.8 million in 2018 compared to $ 333.4 million in 2017 and $ 329.5 million in 2016 . as a percentage of services revenue , cost of services remained relatively flat at 71 % in 2018 , 69 % in 2017 and 70 % in 2016 . cost of services as a percentage of services revenue is primarily reflective of how our fixed cost structure is being absorbed by revenue . cost of product sales , excluding depreciation cost of product sales increased to $ 153.1 million in 2018 from $ 131.6 million in 2017 and $ 108.0 million in 2016 . as a percentage of product sales revenue , cost of sales improved to 72 % for 2018 from 79 % for 2017 and 89 % for 2016 . the improvement in cost of product sales as a percentage of sales revenue in 2018 was primarily due to the improved absorption rates of our fixed costs and investments in manufacturing automation . general and administrative expense general and administrative ( `` g & a `` ) expenses include corporate management and centralized administrative services that benefit our operations . g & a expenses were $ 62.9 million in 2018 compared to $ 47.7 million and $ 39.4 million during 2017 and 2016 , respectively . the variances are primarily due to changes in compensation expense during those periods , including additional stock compensation expense of $ 9.9 million in 2018 recorded for retirement eligible employees . see note 14 , stock-based compensation for further detail . depreciation and amortization expense depreciation and amortization expense of $ 23.1 million in 2018 is down compared to $ 24.5 million in 2017 and $ 26.3 million in 2016 . other ( income ) expense , net the components of other ( income ) expense , net , for the years ended december 31 , 2018 , 2017 and 2016 were as follows ( in thousands ) : replace_table_token_4_th in 2018 , we received settlement of a claim for business interruption and damages incurred as a result of hurricane harvey in 2017 . story_separator_special_tag recognition of the need for investment is evidenced by the fids announced over the last two years and wood mckenzie 's estimation of another 30 upstream projects for 2019. however , core lab anticipates a slowing in further project announcements until confidence in the balance of global crude-oil markets is restored . we believe there will be a positive correction to the temporary oversupply of crude oil by the end of the first quarter 2019 , which should encourage additional fid projects to be announced in 2019. we continue to focus on large-scale core analyses and reservoir fluid characterization studies in the eagle ford , the permian basin , offshore alaska and the gulf of mexico , along with guyana , malaysia and other international locations such as offshore south america , and the middle east . we also focus on complex completions in unconventional tight-oil reservoirs , technological solutions and services for increasing daily productions and eurs . as customary , core lab expects typical sequential seasonal industry patterns will cause the first quarter of 2019 to be down , and international field development spending will be funded largely from operating budgets . international recovery on a more broad-based scope is expected to improve as 2019 unfolds . reservoir description continues to discuss international projects with clients , which are in alignment with fids previously announced . the revenue opportunity for reservoir description occurs once the well has been drilled and core and fluid samples are taken and analyzed . activity levels and revenue opportunities from these fids and the emerging international recovery are expected to have a positive impact on financial performance in 2019. the average first quarter 2019 u.s. rig count is projected to be flat to modestly down sequentially , with u.s. completion activity to remain at similar levels exiting 2018 , until transitory logistical bottlenecks are addressed ( e.g . supply chain logistics and take-away restrictions are resolved in the permian basin of west texas ) . these logistical bottlenecks are anticipated to be resolved in the second half of 2019. in addition , an emerging trend to larger pad drilling sites , increasing from six to eight wells up to 24 wells , will create an increase in drilled but uncompleted wells over the next several quarters . combined , these issues could impact the rate of revenue growth opportunity for any company that is reliant on completions as a catalyst for growth . 27 the drilled-but-uncompleted well inventory levels continue to rise and are in excess of moderated inventory levels for current activity levels . these uncompleted wells should provide core lab with future revenue opportunities . reservoir description continues to discuss international projects with clients which are in alignment with fids previously announced . activity levels and revenue opportunities from fids and the emerging international recovery are expected to have a positive impact on financial performance in 2019. the revenue opportunity for reservoir description occurs once the well has been drilled and core and fluid samples are taken and analyzed . critical accounting estimates the preparation of financial statements in accordance with u.s. gaap requires us to make certain estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period . we evaluate our estimates on an ongoing basis and determine the adequacy of our estimates based on our historical experience and various other assumptions that we believe are reasonable under the circumstances . by nature , these judgments are subject to an inherent degree of uncertainty . we consider an accounting estimate to be critical if it is highly subjective and if changes in the estimate under different assumptions would result in a material impact on our financial condition and results of operations . the following transaction types require significant judgment and , therefore , are considered critical accounting policies as of december 31 , 2018 . income taxes our income tax expense includes income taxes of the netherlands , the u.s. and other foreign countries as well as local , state and provincial income taxes . we recognize deferred tax assets or liabilities for the differences between the financial statement carrying amount and tax basis of assets and liabilities using enacted tax rates in effect for the years in which the asset is recovered or the liability is settled . we estimate the likelihood of the recoverability of our deferred tax assets ( particularly , net operating loss carry-forwards ) . any valuation allowance recorded is based on estimates and assumptions of taxable income into the future and a determination is made of the magnitude of deferred tax assets which are more likely than not to be realized . valuation allowances of our net deferred tax assets aggregated to $ 9.7 million and $ 8.2 million at december 31 , 2018 and 2017 , respectively . if these estimates and related assumptions change in the future , we may be required to record additional valuation allowances against our deferred tax assets and our effective tax rate may increase which could result in a material adverse effect on our financial position , results of operations and cash flows . we have not provided for deferred taxes on the unremitted earnings of certain subsidiaries that we consider to be indefinitely reinvested . should we make a distribution of the unremitted earnings of these subsidiaries , we may be required to record additional taxes . we record a liability for unrecognized tax benefits resulting from uncertain tax positions taken or expected to be taken in our tax return . we also recognize interest and penalties , if any , related to unrecognized tax benefits in income tax expense . long-lived assets , intangibles and goodwill property , plant and equipment are carried at cost less accumulated depreciation . major renewals and improvements are capitalized while maintenance and

. cash used in financing activities in 2017 decreased $ 20.8 million compared to 2016 . during 2018 , we used $ 7.5 million to repurchase our common shares , $ 97.3 million to pay dividends , and increased our debt balance by $ 64 million . during 2017 , we used $ 16.9 million to repurchase our common shares , $ 97.1 million to pay dividends , and increased our debt balance by $ 10 million . during 2016 , we used $ 7.2 million to repurchase our common shares , $ 95.1 million to pay dividends , and decreased our debt balance by $ 215 million through the issuance of new shares . during the year ended december 31 , 2018 , we repurchased 85,985 shares of our common stock for an aggregate amount of $ 7.5 million , or an average price of $ 86.66 per share . the repurchase of shares in the open market is at the discretion of management pursuant to shareholder authorization . we regard these treasury shares as a temporary investment which may be used to fund restricted shares that vest or to finance future acquisitions . under dutch law and subject to certain dutch statutory provisions and shareholder approval , we can hold a maximum of 50 % of our issued shares in treasury . we currently have shareholder approval to hold 10 % of our issued share capital in treasury .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```. cash used in financing activities in 2017 decreased $ 20.8 million compared to 2016 . during 2018 , we used $ 7.5 million to repurchase our common shares , $ 97.3 million to pay dividends , and increased our debt balance by $ 64 million . during 2017 , we used $ 16.9 million to repurchase our common shares , $ 97.1 million to pay dividends , and increased our debt balance by $ 10 million . during 2016 , we used $ 7.2 million to repurchase our common shares , $ 95.1 million to pay dividends , and decreased our debt balance by $ 215 million through the issuance of new shares . during the year ended december 31 , 2018 , we repurchased 85,985 shares of our common stock for an aggregate amount of $ 7.5 million , or an average price of $ 86.66 per share . the repurchase of shares in the open market is at the discretion of management pursuant to shareholder authorization . we regard these treasury shares as a temporary investment which may be used to fund restricted shares that vest or to finance future acquisitions . under dutch law and subject to certain dutch statutory provisions and shareholder approval , we can hold a maximum of 50 % of our issued shares in treasury . we currently have shareholder approval to hold 10 % of our issued share capital in treasury . ``` Suspicious Activity Report : although the north america rig count had improved by the end of 2018 it still remained almost 50 % below 2014 levels . the build in levels of activities on development projects and producing fields in the u.s. unconventional reservoirs during 2017 continued to strengthen during most of 2018 , until october 2018 when the commodity price weakened significantly and activity levels decreased . outside of north america , activities associated with the exploration for and production of oil dropped to current lower levels during the industry downturn which began at the end of 2014 and remained relatively flat during 2017 and 2018. our clients ' activities in the international and deepwater markets remained at these lower levels in 2017 and 2018 , and although activities have not yet increased , we believe these markets have shown signs of recovery for 2019 and beyond as our clients have announced new capital investment projects throughout 2017 and 2018. results of operations operating results for the year ended december 31 , 2018 compared to the years ended december 31 , 2017 and 2016 we evaluate our operating results by analyzing revenue , operating income and operating income margin ( defined as operating income divided by total revenue ) . since we have a relatively fixed cost structure , increases in revenue generally translate into higher operating income results . results for the years ended december 31 , 2018 , 2017 and 2016 are summarized in the following chart : 19 results of operations as a percentage of applicable revenue for the years ended december 31 , 2018 , 2017 and 2016 are as follows ( in thousands , except for per share information ) : replace_table_token_3_th services revenue services revenue , which is tied more to activities associated with the exploration and production of oil and gas outside the u.s. , increased 1.4 % to $ 486.8 million in 2018 from $ 480.3 million in 2017 which increased 2.5 % from $ 468.4 million in 2016 . the increase in revenue was driven by a stronger u.s. market for most of 2018 , which was partially offset by a weaker market outside the u.s. crude oil prices continued to strengthen throughout 2018 until early october when crude oil prices peaked and decreased over 40 % by december 2018. the improvement in crude oil prices continued to support elevated activity levels in the u.s. onshore market for most of 2018 , however activities outside the u.s. have remained flat . although our clients have announced final investment decisions ( `` fids `` ) for several projects outside the u.s. and in offshore environments , significant activity on these projects did not start in 2018 and wells must be drilled and or completed , stimulated , cored and have reservoir fluid samples collected , before we see a revenue opportunity . we continue our focus on worldwide crude oil related projects , including those related to the development of fields in onshore and offshore north america , offshore south america , offshore europe and africa , the middle east , and asia pacific regions . product sales revenue product sales revenue , which is tied more to the completion of wells in north america , increased 28 % to $ 214.0 million in 2018 from $ 167.6 million in 2017 and increased 38 % from $ 121.8 million in 2016 . the 28 % increase in product sales revenue 20 in 2018 compared to 2017 outpaced the 13 % increase in rig count and the 25 % increase in the completion of wells due to our differentiated well completion product sales surpassing the industry activity levels in north america . cost of services , excluding depreciation cost of services increased to $ 343.8 million in 2018 compared to $ 333.4 million in 2017 and $ 329.5 million in 2016 . as a percentage of services revenue , cost of services remained relatively flat at 71 % in 2018 , 69 % in 2017 and 70 % in 2016 . cost of services as a percentage of services revenue is primarily reflective of how our fixed cost structure is being absorbed by revenue . cost of product sales , excluding depreciation cost of product sales increased to $ 153.1 million in 2018 from $ 131.6 million in 2017 and $ 108.0 million in 2016 . as a percentage of product sales revenue , cost of sales improved to 72 % for 2018 from 79 % for 2017 and 89 % for 2016 . the improvement in cost of product sales as a percentage of sales revenue in 2018 was primarily due to the improved absorption rates of our fixed costs and investments in manufacturing automation . general and administrative expense general and administrative ( `` g & a `` ) expenses include corporate management and centralized administrative services that benefit our operations . g & a expenses were $ 62.9 million in 2018 compared to $ 47.7 million and $ 39.4 million during 2017 and 2016 , respectively . the variances are primarily due to changes in compensation expense during those periods , including additional stock compensation expense of $ 9.9 million in 2018 recorded for retirement eligible employees . see note 14 , stock-based compensation for further detail . depreciation and amortization expense depreciation and amortization expense of $ 23.1 million in 2018 is down compared to $ 24.5 million in 2017 and $ 26.3 million in 2016 . other ( income ) expense , net the components of other ( income ) expense , net , for the years ended december 31 , 2018 , 2017 and 2016 were as follows ( in thousands ) : replace_table_token_4_th in 2018 , we received settlement of a claim for business interruption and damages incurred as a result of hurricane harvey in 2017 . story_separator_special_tag recognition of the need for investment is evidenced by the fids announced over the last two years and wood mckenzie 's estimation of another 30 upstream projects for 2019. however , core lab anticipates a slowing in further project announcements until confidence in the balance of global crude-oil markets is restored . we believe there will be a positive correction to the temporary oversupply of crude oil by the end of the first quarter 2019 , which should encourage additional fid projects to be announced in 2019. we continue to focus on large-scale core analyses and reservoir fluid characterization studies in the eagle ford , the permian basin , offshore alaska and the gulf of mexico , along with guyana , malaysia and other international locations such as offshore south america , and the middle east . we also focus on complex completions in unconventional tight-oil reservoirs , technological solutions and services for increasing daily productions and eurs . as customary , core lab expects typical sequential seasonal industry patterns will cause the first quarter of 2019 to be down , and international field development spending will be funded largely from operating budgets . international recovery on a more broad-based scope is expected to improve as 2019 unfolds . reservoir description continues to discuss international projects with clients , which are in alignment with fids previously announced . the revenue opportunity for reservoir description occurs once the well has been drilled and core and fluid samples are taken and analyzed . activity levels and revenue opportunities from these fids and the emerging international recovery are expected to have a positive impact on financial performance in 2019. the average first quarter 2019 u.s. rig count is projected to be flat to modestly down sequentially , with u.s. completion activity to remain at similar levels exiting 2018 , until transitory logistical bottlenecks are addressed ( e.g . supply chain logistics and take-away restrictions are resolved in the permian basin of west texas ) . these logistical bottlenecks are anticipated to be resolved in the second half of 2019. in addition , an emerging trend to larger pad drilling sites , increasing from six to eight wells up to 24 wells , will create an increase in drilled but uncompleted wells over the next several quarters . combined , these issues could impact the rate of revenue growth opportunity for any company that is reliant on completions as a catalyst for growth . 27 the drilled-but-uncompleted well inventory levels continue to rise and are in excess of moderated inventory levels for current activity levels . these uncompleted wells should provide core lab with future revenue opportunities . reservoir description continues to discuss international projects with clients which are in alignment with fids previously announced . activity levels and revenue opportunities from fids and the emerging international recovery are expected to have a positive impact on financial performance in 2019. the revenue opportunity for reservoir description occurs once the well has been drilled and core and fluid samples are taken and analyzed . critical accounting estimates the preparation of financial statements in accordance with u.s. gaap requires us to make certain estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period . we evaluate our estimates on an ongoing basis and determine the adequacy of our estimates based on our historical experience and various other assumptions that we believe are reasonable under the circumstances . by nature , these judgments are subject to an inherent degree of uncertainty . we consider an accounting estimate to be critical if it is highly subjective and if changes in the estimate under different assumptions would result in a material impact on our financial condition and results of operations . the following transaction types require significant judgment and , therefore , are considered critical accounting policies as of december 31 , 2018 . income taxes our income tax expense includes income taxes of the netherlands , the u.s. and other foreign countries as well as local , state and provincial income taxes . we recognize deferred tax assets or liabilities for the differences between the financial statement carrying amount and tax basis of assets and liabilities using enacted tax rates in effect for the years in which the asset is recovered or the liability is settled . we estimate the likelihood of the recoverability of our deferred tax assets ( particularly , net operating loss carry-forwards ) . any valuation allowance recorded is based on estimates and assumptions of taxable income into the future and a determination is made of the magnitude of deferred tax assets which are more likely than not to be realized . valuation allowances of our net deferred tax assets aggregated to $ 9.7 million and $ 8.2 million at december 31 , 2018 and 2017 , respectively . if these estimates and related assumptions change in the future , we may be required to record additional valuation allowances against our deferred tax assets and our effective tax rate may increase which could result in a material adverse effect on our financial position , results of operations and cash flows . we have not provided for deferred taxes on the unremitted earnings of certain subsidiaries that we consider to be indefinitely reinvested . should we make a distribution of the unremitted earnings of these subsidiaries , we may be required to record additional taxes . we record a liability for unrecognized tax benefits resulting from uncertain tax positions taken or expected to be taken in our tax return . we also recognize interest and penalties , if any , related to unrecognized tax benefits in income tax expense . long-lived assets , intangibles and goodwill property , plant and equipment are carried at cost less accumulated depreciation . major renewals and improvements are capitalized while maintenance and

we have regularly been successful in identifying and developing both aftermarket and oem products to drive our growth . improving our cost structure . we are committed to maintaining and continuously improving our lean cost structure through detailed attention to the cost of each of the products that we offer and our organizational structure , with a focus on reducing the cost of each . providing highly engineered value-added products to customers . we focus on the engineering , manufacturing and marketing of a broad range of highly engineered niche products that we believe provide value to our customers . we believe we have been consistently successful in communicating to our customers the value of our products . this has generally enabled us to price our products to fairly reflect the value we provide and the resources required to do so . selective acquisition strategy . we selectively pursue the acquisition of proprietary aerospace component businesses when we see an opportunity to create value through the application of our three core value-driven operating strategies . the aerospace industry , in particular , remains highly fragmented , with many of the companies in the industry being small private businesses or small non-core operations of larger businesses . we have significant experience among our management team in executing acquisitions and integrating acquired businesses into our company and culture . as of the date of this report , we have successfully acquired 58 businesses and or product lines since our formation in 1993. many of these acquisitions have been 24 integrated into an existing transdigm production facility , which enables a higher production capacity utilization , which in turn improves gross profit levels due to the ability to spread the fixed manufacturing overhead costs over higher production volume . acquisitions and divestitures during the previous three fiscal years are more fully described in note 2 , “ acquisitions ” in the notes to the consolidated financial statements included herein . critical accounting policies our consolidated financial statements have been prepared in conformity with gaap , which often requires the judgment of management in the selection and application of certain accounting principles and methods . management believes that the quality and reasonableness of our most critical policies enable the fair presentation of our financial position and results of operations . however , investors are cautioned that the sensitivity of financial statements to these methods , assumptions and estimates could create materially different results under different conditions or using different assumptions . below are those policies applied in preparing our financial statements that management believes are the most dependent on the application of estimates and assumptions . for additional accounting policies , see note 3 , “ summary of significant accounting policies ” in the notes to the consolidated financial statements included herein . revenue recognition and related allowances : revenue is recognized from the sale of products when title and risk of loss passes to the customer , which is generally at the time of shipment . substantially all product sales are made pursuant to firm , fixed-price purchase orders received from customers . collectibility of amounts recorded as revenue is reasonably assured at the time of sale . provisions for returns , uncollectible accounts and the cost of repairs under contract warranty provisions are provided for in the same period as the related revenues are recorded and are principally based on historical results modified , as appropriate , by the most current information available . we have a history of making reasonably dependable estimates of such allowances ; however , due to uncertainties inherent in the estimation process , it is possible that actual results may vary from the estimates and the differences could be material . management estimates the allowance for doubtful accounts based on the aging of the accounts receivable and customer creditworthiness . the allowance also incorporates a provision for the estimated impact of disputes with customers . management 's estimate of the allowance amounts that are necessary includes amounts for specifically identified credit losses and estimated credit losses based on historical information . the determination of the amount of the allowance for doubtful accounts is subject to significant levels of judgment and estimation by management . depending on the resolution of potential credit and other collection issues , or if the financial condition of any of the company 's customers were to deteriorate and their ability to make required payments were to become impaired , increases in these allowances may be required . historically , changes in estimates in the allowance for doubtful accounts have not been significant . inventories : inventories are stated at the lower of cost or market . cost of inventories is generally determined by the average cost and the first-in , first-out ( fifo ) methods and includes material , labor and overhead related to the manufacturing process . because the company sells products that are installed on airframes that can be in-service for 25 or more years , it must keep a supply of such products on hand while the airframes are in use . where management estimated that the current market value was below cost or determined that future demand was lower than current inventory levels , based on historical experience , current and projected market demand , current and projected volume trends and other relevant current and projected factors associated with the current economic conditions , a reduction in inventory cost to estimated net realizable value was made by recording a provision included in cost of sales . although management believes that the company 's estimates of excess and obsolete inventory are reasonable , actual results may differ materially from the estimates and additional provisions may be required in the future . story_separator_special_tag acquisition sales for the power & control segment totaled $ 312.8 million , or an increase of 23.5 % , resulting from the acquisitions of breeze-eastern and data device corporation in fiscal year 2016 and the acquisitions of pneudraulics , telair international gmbh and telair us llc in fiscal year 2015. organic sales for the airframe segment increased $ 70.7 million , or an increase of 5.5 % , when compared to the fiscal year ended september 30 , 2015 . the organic sales increase primarily resulted from increases in commercial aftermarket ( $ 29.3 million , an increase of 5.3 % ) , commercial oem sales ( $ 19.6 million , an increase of 4.5 % ) and defense sales ( $ 21.6 million , an increase of 7.7 % ) . acquisition sales for the airframe segment totaled $ 96.5 million , or an increase of 7.5 % , resulting from the acquisitions of pexco aerospace , adams rite aerospace gmbh and nordisk aviation products in fiscal year 2015. sales for the non-aviation segment increased $ 5.5 million when compared to the fiscal year ended september 30 , 2015 . the sales increase was primarily due to an increase in commercial oem sales of approximately $ 3.0 million . there was no impact from acquisitions in the results of the non-aviation segment . ebitda as defined . ebitda as defined by segment for the fiscal years ended september 30 , 2016 and 2015 were as follows ( amounts in millions ) : replace_table_token_15_th organic ebitda as defined for the power & control segment increased approximately $ 22.9 million for the fiscal year ended september 30 , 2016 compared to the fiscal year ended september 30 , 2015 . ebitda as defined from the acquisitions 29 of breeze-eastern and data device corporation in fiscal year 2016 and the acquisitions of pneudraulics , telair international gmbh and telair us llc in fiscal year 2015 was approximately $ 111.5 million for the fiscal year ended september 30 , 2016 . organic ebitda as defined for the airframe segment increased approximately $ 76.9 million for the fiscal year ended september 30 , 2016 compared to the fiscal year ended september 30 , 2015 . ebitda as defined from the fiscal year 2015 acquisitions of pexco aerospace , adams rite aerospace gmbh and nordisk aviation products was approximately $ 47.5 million for the fiscal year ended september 30 , 2016 . ebitda as defined for the non-aviation segment increased approximately $ 5.8 million for the fiscal year ended september 30 , 2016 compared to the fiscal year ended september 30 , 2015 . there was no impact from acquisitions in the results of the non-aviation segment . fiscal year ended september 30 , 2015 compared with fiscal year ended september 30 , 2014 total company net sales . net organic sales and acquisition sales and the related dollar and percentage changes for the fiscal years ended september 30 , 2015 and 2014 were as follows ( amounts in millions ) : replace_table_token_16_th acquisition sales represent sales of acquired businesses for the period up to one year subsequent to their acquisition dates . the amount of acquisition sales shown in the table above was attributable to the acquisitions of telair cargo group , adams rite aerospace gmbh , pexco aerospace and pneudraulics in fiscal 2015 and airborne and eme in fiscal 2014 . commercial aftermarket sales increased $ 36.9 million , or an increase of 4.2 % , defense sales increased $ 29.8 million , or an increase of 4.3 % , and commercial oem sales increased $ 16.4 million , or an increase of 2.4 % , for the fiscal year ended september 30 , 2015 compared to fiscal year ended september 30 , 2014 . cost of sales and gross profit . cost of sales increased by $ 152.3 million , or 13.8 % , to $ 1,257.3 million for the fiscal year ended september 30 , 2015 compared to $ 1,105.0 million for the fiscal year ended september 30 , 2014 . cost of sales and the related percentage of total sales for the fiscal years ended september 30 , 2015 and 2014 were as follows ( amounts in millions ) : replace_table_token_17_th the increase in the dollar amount of cost of sales during the fiscal year ended september 30 , 2015 was primarily due to increased volume associated with the sales from acquisitions and organic sales growth . gross profit as a percentage of sales increased by 0.2 percentage points to 53.6 % for the fiscal year ended september 30 , 2015 from 53.4 % for the fiscal year ended september 30 , 2014 . the dollar amount of gross profit increased by $ 181.9 million , or 14.3 % , for the fiscal year ended september 30 , 2015 compared to the comparable period last year due to the following items : gross profit on the sales from the acquisitions indicated above ( excluding acquisition-related costs ) was approximately $ 100 million for the fiscal year ended september 30 , 2015 , which represented gross profit of approximately 39 % of 30 the acquisition sales . the lower gross profit margin on the acquisition sales reduced gross profit as a percentage of consolidated sales by approximately 2 percentage points . organic sales growth described above , application of our three core value-driven operating strategies ( obtaining profitable new business , continually improving our cost structure , and providing highly engineered value-added products to customers ) , and positive leverage on our fixed overhead costs spread over a higher production volume , resulted in a net increase in gross profit of approximately $ 83 million for the fiscal year ended september 30 , 2015 . slightly offsetting the increases in gross profit was the impact of higher inventory purchase accounting adjustments charged to cost of sales of approximately $ 1 million . selling and administrative expenses . selling and administrative

net cash used in investing activities was $ 329.6 million during fiscal 2014 consisting primarily of the acquisitions of airborne and eme for a total of $ 311.9 million and capital expenditures of $ 34.1 million offset by the cash proceeds on the sale of real estate of $ 16.4 million . 34 financing activities . net cash provided by financing activities during fiscal 2016 was $ 1,646.8 million , which was primarily comprised of net proceeds from the 2016 term loans of $ 1,725.9 million , net proceeds from the 2026 notes of $ 939.6 million and $ 30.1 million of cash proceeds from the exercise of stock options . these increases were partially offset by $ 834.4 million of repayments on our existing term loans , $ 207.8 million in treasury stock purchases under the company 's share repurchase programs and the impact from the prospective adoption of asu 2016-09 which resulted in the excess tax benefits related to share-based payment arrangements being classified within operating activities beginning in fiscal 2016. in october 2016 , the company completed additional financing in connection with the tendering of its 2021 notes and declaration of a special dividend of $ 24.00 per common share along with cash dividend equivalent payments on options granted under its stock option plans .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```net cash used in investing activities was $ 329.6 million during fiscal 2014 consisting primarily of the acquisitions of airborne and eme for a total of $ 311.9 million and capital expenditures of $ 34.1 million offset by the cash proceeds on the sale of real estate of $ 16.4 million . 34 financing activities . net cash provided by financing activities during fiscal 2016 was $ 1,646.8 million , which was primarily comprised of net proceeds from the 2016 term loans of $ 1,725.9 million , net proceeds from the 2026 notes of $ 939.6 million and $ 30.1 million of cash proceeds from the exercise of stock options . these increases were partially offset by $ 834.4 million of repayments on our existing term loans , $ 207.8 million in treasury stock purchases under the company 's share repurchase programs and the impact from the prospective adoption of asu 2016-09 which resulted in the excess tax benefits related to share-based payment arrangements being classified within operating activities beginning in fiscal 2016. in october 2016 , the company completed additional financing in connection with the tendering of its 2021 notes and declaration of a special dividend of $ 24.00 per common share along with cash dividend equivalent payments on options granted under its stock option plans . ``` Suspicious Activity Report : we have regularly been successful in identifying and developing both aftermarket and oem products to drive our growth . improving our cost structure . we are committed to maintaining and continuously improving our lean cost structure through detailed attention to the cost of each of the products that we offer and our organizational structure , with a focus on reducing the cost of each . providing highly engineered value-added products to customers . we focus on the engineering , manufacturing and marketing of a broad range of highly engineered niche products that we believe provide value to our customers . we believe we have been consistently successful in communicating to our customers the value of our products . this has generally enabled us to price our products to fairly reflect the value we provide and the resources required to do so . selective acquisition strategy . we selectively pursue the acquisition of proprietary aerospace component businesses when we see an opportunity to create value through the application of our three core value-driven operating strategies . the aerospace industry , in particular , remains highly fragmented , with many of the companies in the industry being small private businesses or small non-core operations of larger businesses . we have significant experience among our management team in executing acquisitions and integrating acquired businesses into our company and culture . as of the date of this report , we have successfully acquired 58 businesses and or product lines since our formation in 1993. many of these acquisitions have been 24 integrated into an existing transdigm production facility , which enables a higher production capacity utilization , which in turn improves gross profit levels due to the ability to spread the fixed manufacturing overhead costs over higher production volume . acquisitions and divestitures during the previous three fiscal years are more fully described in note 2 , “ acquisitions ” in the notes to the consolidated financial statements included herein . critical accounting policies our consolidated financial statements have been prepared in conformity with gaap , which often requires the judgment of management in the selection and application of certain accounting principles and methods . management believes that the quality and reasonableness of our most critical policies enable the fair presentation of our financial position and results of operations . however , investors are cautioned that the sensitivity of financial statements to these methods , assumptions and estimates could create materially different results under different conditions or using different assumptions . below are those policies applied in preparing our financial statements that management believes are the most dependent on the application of estimates and assumptions . for additional accounting policies , see note 3 , “ summary of significant accounting policies ” in the notes to the consolidated financial statements included herein . revenue recognition and related allowances : revenue is recognized from the sale of products when title and risk of loss passes to the customer , which is generally at the time of shipment . substantially all product sales are made pursuant to firm , fixed-price purchase orders received from customers . collectibility of amounts recorded as revenue is reasonably assured at the time of sale . provisions for returns , uncollectible accounts and the cost of repairs under contract warranty provisions are provided for in the same period as the related revenues are recorded and are principally based on historical results modified , as appropriate , by the most current information available . we have a history of making reasonably dependable estimates of such allowances ; however , due to uncertainties inherent in the estimation process , it is possible that actual results may vary from the estimates and the differences could be material . management estimates the allowance for doubtful accounts based on the aging of the accounts receivable and customer creditworthiness . the allowance also incorporates a provision for the estimated impact of disputes with customers . management 's estimate of the allowance amounts that are necessary includes amounts for specifically identified credit losses and estimated credit losses based on historical information . the determination of the amount of the allowance for doubtful accounts is subject to significant levels of judgment and estimation by management . depending on the resolution of potential credit and other collection issues , or if the financial condition of any of the company 's customers were to deteriorate and their ability to make required payments were to become impaired , increases in these allowances may be required . historically , changes in estimates in the allowance for doubtful accounts have not been significant . inventories : inventories are stated at the lower of cost or market . cost of inventories is generally determined by the average cost and the first-in , first-out ( fifo ) methods and includes material , labor and overhead related to the manufacturing process . because the company sells products that are installed on airframes that can be in-service for 25 or more years , it must keep a supply of such products on hand while the airframes are in use . where management estimated that the current market value was below cost or determined that future demand was lower than current inventory levels , based on historical experience , current and projected market demand , current and projected volume trends and other relevant current and projected factors associated with the current economic conditions , a reduction in inventory cost to estimated net realizable value was made by recording a provision included in cost of sales . although management believes that the company 's estimates of excess and obsolete inventory are reasonable , actual results may differ materially from the estimates and additional provisions may be required in the future . story_separator_special_tag acquisition sales for the power & control segment totaled $ 312.8 million , or an increase of 23.5 % , resulting from the acquisitions of breeze-eastern and data device corporation in fiscal year 2016 and the acquisitions of pneudraulics , telair international gmbh and telair us llc in fiscal year 2015. organic sales for the airframe segment increased $ 70.7 million , or an increase of 5.5 % , when compared to the fiscal year ended september 30 , 2015 . the organic sales increase primarily resulted from increases in commercial aftermarket ( $ 29.3 million , an increase of 5.3 % ) , commercial oem sales ( $ 19.6 million , an increase of 4.5 % ) and defense sales ( $ 21.6 million , an increase of 7.7 % ) . acquisition sales for the airframe segment totaled $ 96.5 million , or an increase of 7.5 % , resulting from the acquisitions of pexco aerospace , adams rite aerospace gmbh and nordisk aviation products in fiscal year 2015. sales for the non-aviation segment increased $ 5.5 million when compared to the fiscal year ended september 30 , 2015 . the sales increase was primarily due to an increase in commercial oem sales of approximately $ 3.0 million . there was no impact from acquisitions in the results of the non-aviation segment . ebitda as defined . ebitda as defined by segment for the fiscal years ended september 30 , 2016 and 2015 were as follows ( amounts in millions ) : replace_table_token_15_th organic ebitda as defined for the power & control segment increased approximately $ 22.9 million for the fiscal year ended september 30 , 2016 compared to the fiscal year ended september 30 , 2015 . ebitda as defined from the acquisitions 29 of breeze-eastern and data device corporation in fiscal year 2016 and the acquisitions of pneudraulics , telair international gmbh and telair us llc in fiscal year 2015 was approximately $ 111.5 million for the fiscal year ended september 30 , 2016 . organic ebitda as defined for the airframe segment increased approximately $ 76.9 million for the fiscal year ended september 30 , 2016 compared to the fiscal year ended september 30 , 2015 . ebitda as defined from the fiscal year 2015 acquisitions of pexco aerospace , adams rite aerospace gmbh and nordisk aviation products was approximately $ 47.5 million for the fiscal year ended september 30 , 2016 . ebitda as defined for the non-aviation segment increased approximately $ 5.8 million for the fiscal year ended september 30 , 2016 compared to the fiscal year ended september 30 , 2015 . there was no impact from acquisitions in the results of the non-aviation segment . fiscal year ended september 30 , 2015 compared with fiscal year ended september 30 , 2014 total company net sales . net organic sales and acquisition sales and the related dollar and percentage changes for the fiscal years ended september 30 , 2015 and 2014 were as follows ( amounts in millions ) : replace_table_token_16_th acquisition sales represent sales of acquired businesses for the period up to one year subsequent to their acquisition dates . the amount of acquisition sales shown in the table above was attributable to the acquisitions of telair cargo group , adams rite aerospace gmbh , pexco aerospace and pneudraulics in fiscal 2015 and airborne and eme in fiscal 2014 . commercial aftermarket sales increased $ 36.9 million , or an increase of 4.2 % , defense sales increased $ 29.8 million , or an increase of 4.3 % , and commercial oem sales increased $ 16.4 million , or an increase of 2.4 % , for the fiscal year ended september 30 , 2015 compared to fiscal year ended september 30 , 2014 . cost of sales and gross profit . cost of sales increased by $ 152.3 million , or 13.8 % , to $ 1,257.3 million for the fiscal year ended september 30 , 2015 compared to $ 1,105.0 million for the fiscal year ended september 30 , 2014 . cost of sales and the related percentage of total sales for the fiscal years ended september 30 , 2015 and 2014 were as follows ( amounts in millions ) : replace_table_token_17_th the increase in the dollar amount of cost of sales during the fiscal year ended september 30 , 2015 was primarily due to increased volume associated with the sales from acquisitions and organic sales growth . gross profit as a percentage of sales increased by 0.2 percentage points to 53.6 % for the fiscal year ended september 30 , 2015 from 53.4 % for the fiscal year ended september 30 , 2014 . the dollar amount of gross profit increased by $ 181.9 million , or 14.3 % , for the fiscal year ended september 30 , 2015 compared to the comparable period last year due to the following items : gross profit on the sales from the acquisitions indicated above ( excluding acquisition-related costs ) was approximately $ 100 million for the fiscal year ended september 30 , 2015 , which represented gross profit of approximately 39 % of 30 the acquisition sales . the lower gross profit margin on the acquisition sales reduced gross profit as a percentage of consolidated sales by approximately 2 percentage points . organic sales growth described above , application of our three core value-driven operating strategies ( obtaining profitable new business , continually improving our cost structure , and providing highly engineered value-added products to customers ) , and positive leverage on our fixed overhead costs spread over a higher production volume , resulted in a net increase in gross profit of approximately $ 83 million for the fiscal year ended september 30 , 2015 . slightly offsetting the increases in gross profit was the impact of higher inventory purchase accounting adjustments charged to cost of sales of approximately $ 1 million . selling and administrative expenses . selling and administrative

we are targeting hemp-based solutions that allow farmers to reliably and consistently achieve compliance with usda regulations , through varieties with improved functionality and application of specific attributes such as select cannabinoid contents for health and wellness , enhanced proteins profiles for plant-based dietary applications and industrial applications such as clothing and hempcrete . arcadia conducts its business in only federal and state markets in which its activities are legal . 44 on october 31 , 2019 , the usda published the i nterim f inal r ul e as authorized by the agriculture improvement act of 2018 for hemp cultivation , which mandates that states test hemp crops and dispose of `` hot `` crops that exceed 0.3 % thc . while hemp farmers will have acc ess to crop protection options , the destruction of hot crops that fail these stringent inspections will not be a covered loss under crop insurance programs . in 2019 alone , more than 20 % of u.s. hemp crops were non-compliant , representing over $ 2 billion in losses for growers . arcadia goodhemp in december 2019 , we announced the launch of a new product line , goodhemp , as the company 's new commercial brand for delivering genetically superior hemp seeds , transplants , flower and extracts . the first variety in goodhemp 's catalog , complia bot+ , is a widely adapted cannabis strain that delivers high cannabinoid ( cbd ) content ( more than 10 % ) with ultra-low thc , the psychoactive compound in cannabis . it is part of the complia hemp seed line arcadia is bringing to market through goodhemp , with six additional proprietary varieties in early adopter farmer trials with sales expected in the 2020 season . the hemp business journal estimates the hemp cbd market – the primary non-psychoactive compound in hemp – totaled $ 190 million in u.s. sales in 2018. by 2022 , the brightfield group , a hemp and cbd market research firm , projects u.s. sales to reach $ 22 billion . additionally , grandview research estimates the market for non-cannabinoid , industrial hemp market will exceed $ 15 billion by 2027. archipelago ventures hawaii , llc in august 2019 , we formed a new joint venture to serve the hawaiian , north american and asian hemp markets , archipelago ventures hawaii , llc ( “ archipelago ” ) . this new venture between arcadia and legacy ventures hawaii ( “ legacy ” ) combines arcadia 's extensive genetic expertise and seed innovation history with legacy 's growth capital and strategic advisory expertise in the hawaiian markets . additionally , legacy brings to the partnership years of proven success in extraction , product formulation and sales of cannabinol oil and distillate products through its equity partner , vapen cbd . legacy was originally formed to be a vehicle for its partners to pursue hemp opportunities within the hawaiian islands . legacy 's primary role within archipelago is to build world class cgmp extraction facilities to allow hawaiian farmers an outlet for maximizing their profits growing and converting hemp to high grade cbd , as well as other high-value compounds . legacy 's equity partner , vapen cbd , is a wholly owned subsidiary of vext which is a publicly traded cannabis operator based in phoenix , arizona listed on both the canadian and frankfurt exchanges . archipelago creates a vertically integrated supply chain , from seed to sale , we believe the first of its kind in hawaii , and has three important strategic imperatives : ( 1 ) ensure a reliable supply chain during critical scale up of the global hemp market , a major risk mitigation for success , ( 2 ) ensure high quality throughout the supply chain , from genetics to the field and field to the customer and ( 3 ) ensure being well-positioned to address the unique needs and opportunities of the hawaiian market . arcadia goodwheat in 2018 , we launched our goodwheat brand , a non-genetically modified ( non-gm ) portfolio of wheat products that enables food manufacturers to differentiate their consumer-facing brands . consumer food companies are looking to simplify their food ingredient formulations and consumers are demanding “ clean labeling ” in their foods , paying more for foods having fewer artificial ingredients and more natural , recognizable and healthy ingredients . a 2017 survey by pr agency ingredient communications found that 73 % of consumers are happy to pay a higher retail price for a food or drink product made with ingredients they recognize . because goodwheat increases the nutrient density directly in the primary grains and oils , it provides the mechanism for food formulation simplification naturally , cost effectively and in a time-frame to meet evolving consumer demands . the brand launch is a key element of the company 's go-to-market strategy to achieve greater value for its innovations by participating in downstream consumer revenue opportunities . we designed the brand to make an immediate connection with consumers that products made with goodwheat meet their demands for healthier wheat options that also taste great . the goodwheat brand encompasses our current and future non-gm wheat portfolio of high fiber resistant starch ( rs ) and reduced gluten wheat varieties , as well as future wheat innovations . in october 2019 , the u.s. patent and trademark office granted us the latest patents for extended shelf life wheat , the newest trait in our non-genetically modified wheat portfolio . this new trait was designed to promote whole wheat consumption by improving the shelf life and taste of whole grain wheat products . 45 with additional patents granted in 2019 , we now hold more than 15 global patents on our high fiber resistant starch wheat , protecting both bread wheat and durum ( pasta ) wheat . claims granted in 2019 strengthen our intellectual property for our resistant starch portfolio of products . story_separator_special_tag through december 31 , 2018. the estimated fair value of the purchase agreement common stock adjustment feature was $ 4.6 million , the estimated fair value of the purchase agreement common stock warrants decreased by $ 7.9 million , and the estimated fair value of the june offering common stock warrants decreased by $ 6.3 million due to the decrease in the company 's stock price . the purchase agreement common stock adjustment feature liability was released to equity following the final fair value remeasurement in may 2018. see note 11. offering costs offering costs for the year ended december 31 , 2019 of $ 0.7 million is comprised of the placement agent fees , placement agent warrants , advisory fees , and legal and accounting fees related to the june 2019 and september 2019 offerings . offering costs for the year ended december 31 , 2018 of $ 2.6 million is comprised of $ 1.8 million associated with the march 2018 private placement and $ 721,000 related to the june 2018 offering and the june 2018 private placement . income tax provision the income tax provision decreased $ 8,000 or 80 % for the year ended december 31 , 2019 compared to the year ended december 31 , 2018. see note 15 . 51 seasonality we and our commercial partners operate in different geographies around the world and conduct field trials used for data generation , which must be conducted during the appropriate growing seasons for particular crops and markets . often , there is only one crop-growing season per year for certain crops and markets . similarly , climate conditions and other factors that may influence the sales of our products may vary from season to season and year to year . in particular , weather conditions , including natural disasters such as heavy rains , hurricanes , hail , floods , tornadoes , freezing conditions , drought or fire , may affect the timing and outcome of field trials , which may delay milestone payments and the commercialization of products incorporating our seed traits . in the future , sales of commercial products that incorporate our seed traits will vary based on crop growing seasons and weather patterns within particular regions . the level of seasonality in our business overall is difficult to evaluate at this time due to our relatively early stage of development , our relatively limited number of commercialized products , our expansion into new geographical markets and our introduction of new products and traits . liquidity , capital resources and going concern we have funded our operations primarily with the net proceeds from our initial public offering , private placements of equity securities and debt , as well as proceeds from the sale of our sonova products and payments under license agreements , contract research agreements and government grants . our principal use of cash is to fund our operations , which are primarily focused on completing development and commercializing our quality seed traits . this includes replicating field trials , coordinating with our partners on their development programs and scaling harvest production of wheat , hemp and soy . as of december 31 , 2019 , we had cash and cash equivalents of $ 8.4 million and short-term investments of $ 16.9 million . for the years ended december 31 , 2019 and 2018 , the company had net losses of $ 28.9 million and $ 13.5 million , respectively , and net cash used in operations of $ 17.2 million and $ 13.6 million , respectively . as is disclosed in note 11 , the company obtained funding through two separate arrangements during the first half of 2018 and two offerings during june 2019 and september 2019. on march 19 , 2018 , the company entered into securities purchase agreements with institutional investors in connection with a private placement of common stock and warrants in the amount of $ 10 million , exclusive of any related transaction fees . on june 11 , 2018 , the company entered into agreements with institutional investors through a registered direct offering in the amount of $ 14 million , exclusive of any related transaction fees . on june 12 , 2019 , the company entered into agreements with institutional investors through a registered direct offering in the amount of $ 7.5 million exclusive of any related transaction fees . in august and september 2019 , investors exercised warrants , generating cash proceeds totaling $ 5.3 million . on september 5 , 2019 , the company entered into agreements with institutional investors through a registered direct offering in the amount of $ 10 million exclusive of any related transaction fees . we believe that our existing cash , cash equivalents and short-term investments will not be sufficient to meet our anticipated cash requirements for at least the next 12 months which raises substantial doubt about the company 's ability to continue as a going concern . see note 1 of the notes to the consolidated financial statements for more information . we may seek to raise additional funds through debt or equity financings , if necessary . we may also consider entering into additional partner arrangements . our sale of additional equity would result in dilution to our stockholders . our incurrence of debt would result in debt service obligations , and the instruments governing our debt could provide for additional operating and financing covenants that would restrict our operations . if we do require additional funds and are not able to secure adequate additional funding , we may be forced to reduce our spending , extend payment terms with our suppliers , liquidate assets , or suspend or curtail planned development programs . any of these actions could materially harm our business , results of operations and financial condition . at this time , there is significant uncertainty relating to the trajectory of the novel coronavirus outbreak and impact of related responses . the

cash flows from operating activities cash used in operating activities for the year ended december 31 , 2019 was $ 17.2 million . our net loss of $ 28.9 million , change in fair value of contingent consideration of $ 1.0 million , operating lease payments of $ 715,000 , and net amortization of investment premium and discount of $ 180,000 were partially offset by the change in fair value of common stock warrant liabilities and common stock adjustment feature liability of $ 9.2 million , non-cash charges of $ 2.3 million for stock-based compensation , depreciation and amortization of $ 902,000 , as well as $ 708,000 of offering costs incurred in connection with financing activities and adjustments in our working capital accounts of $ 0.1 million . cash used in operating activities for the year ended december 31 , 2018 was $ 13.6 million . our net loss of $ 13.5 million , the change in fair value of common stock warrant liabilities and common stock adjustment feature liability of $ 9.6 million and net amortization of investment premium and discount of $ 193,000 were partially offset by the initial loss on common stock warrant and adjustment feature liabilities of $ 4.0 million , non-cash charges of $ 1.6 million for stock-based compensation , and depreciation and amortization of $ 154,000 , as well as $ 2.6 million of offering costs incurred in connection with financing activities and adjustments in our working capital accounts of $ 1.1 million . cash flows from investing activities cash used in investing activities for the year ended december 31 , 2019 of $ 8.4 million primarily consisted of $ 28.4 million in purchases of short-term investments and $ 1.5 million in purchases of property and equipment , partially offset by $ 21.5 million in proceeds from sales and maturities of investments .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```cash flows from operating activities cash used in operating activities for the year ended december 31 , 2019 was $ 17.2 million . our net loss of $ 28.9 million , change in fair value of contingent consideration of $ 1.0 million , operating lease payments of $ 715,000 , and net amortization of investment premium and discount of $ 180,000 were partially offset by the change in fair value of common stock warrant liabilities and common stock adjustment feature liability of $ 9.2 million , non-cash charges of $ 2.3 million for stock-based compensation , depreciation and amortization of $ 902,000 , as well as $ 708,000 of offering costs incurred in connection with financing activities and adjustments in our working capital accounts of $ 0.1 million . cash used in operating activities for the year ended december 31 , 2018 was $ 13.6 million . our net loss of $ 13.5 million , the change in fair value of common stock warrant liabilities and common stock adjustment feature liability of $ 9.6 million and net amortization of investment premium and discount of $ 193,000 were partially offset by the initial loss on common stock warrant and adjustment feature liabilities of $ 4.0 million , non-cash charges of $ 1.6 million for stock-based compensation , and depreciation and amortization of $ 154,000 , as well as $ 2.6 million of offering costs incurred in connection with financing activities and adjustments in our working capital accounts of $ 1.1 million . cash flows from investing activities cash used in investing activities for the year ended december 31 , 2019 of $ 8.4 million primarily consisted of $ 28.4 million in purchases of short-term investments and $ 1.5 million in purchases of property and equipment , partially offset by $ 21.5 million in proceeds from sales and maturities of investments . ``` Suspicious Activity Report : we are targeting hemp-based solutions that allow farmers to reliably and consistently achieve compliance with usda regulations , through varieties with improved functionality and application of specific attributes such as select cannabinoid contents for health and wellness , enhanced proteins profiles for plant-based dietary applications and industrial applications such as clothing and hempcrete . arcadia conducts its business in only federal and state markets in which its activities are legal . 44 on october 31 , 2019 , the usda published the i nterim f inal r ul e as authorized by the agriculture improvement act of 2018 for hemp cultivation , which mandates that states test hemp crops and dispose of `` hot `` crops that exceed 0.3 % thc . while hemp farmers will have acc ess to crop protection options , the destruction of hot crops that fail these stringent inspections will not be a covered loss under crop insurance programs . in 2019 alone , more than 20 % of u.s. hemp crops were non-compliant , representing over $ 2 billion in losses for growers . arcadia goodhemp in december 2019 , we announced the launch of a new product line , goodhemp , as the company 's new commercial brand for delivering genetically superior hemp seeds , transplants , flower and extracts . the first variety in goodhemp 's catalog , complia bot+ , is a widely adapted cannabis strain that delivers high cannabinoid ( cbd ) content ( more than 10 % ) with ultra-low thc , the psychoactive compound in cannabis . it is part of the complia hemp seed line arcadia is bringing to market through goodhemp , with six additional proprietary varieties in early adopter farmer trials with sales expected in the 2020 season . the hemp business journal estimates the hemp cbd market – the primary non-psychoactive compound in hemp – totaled $ 190 million in u.s. sales in 2018. by 2022 , the brightfield group , a hemp and cbd market research firm , projects u.s. sales to reach $ 22 billion . additionally , grandview research estimates the market for non-cannabinoid , industrial hemp market will exceed $ 15 billion by 2027. archipelago ventures hawaii , llc in august 2019 , we formed a new joint venture to serve the hawaiian , north american and asian hemp markets , archipelago ventures hawaii , llc ( “ archipelago ” ) . this new venture between arcadia and legacy ventures hawaii ( “ legacy ” ) combines arcadia 's extensive genetic expertise and seed innovation history with legacy 's growth capital and strategic advisory expertise in the hawaiian markets . additionally , legacy brings to the partnership years of proven success in extraction , product formulation and sales of cannabinol oil and distillate products through its equity partner , vapen cbd . legacy was originally formed to be a vehicle for its partners to pursue hemp opportunities within the hawaiian islands . legacy 's primary role within archipelago is to build world class cgmp extraction facilities to allow hawaiian farmers an outlet for maximizing their profits growing and converting hemp to high grade cbd , as well as other high-value compounds . legacy 's equity partner , vapen cbd , is a wholly owned subsidiary of vext which is a publicly traded cannabis operator based in phoenix , arizona listed on both the canadian and frankfurt exchanges . archipelago creates a vertically integrated supply chain , from seed to sale , we believe the first of its kind in hawaii , and has three important strategic imperatives : ( 1 ) ensure a reliable supply chain during critical scale up of the global hemp market , a major risk mitigation for success , ( 2 ) ensure high quality throughout the supply chain , from genetics to the field and field to the customer and ( 3 ) ensure being well-positioned to address the unique needs and opportunities of the hawaiian market . arcadia goodwheat in 2018 , we launched our goodwheat brand , a non-genetically modified ( non-gm ) portfolio of wheat products that enables food manufacturers to differentiate their consumer-facing brands . consumer food companies are looking to simplify their food ingredient formulations and consumers are demanding “ clean labeling ” in their foods , paying more for foods having fewer artificial ingredients and more natural , recognizable and healthy ingredients . a 2017 survey by pr agency ingredient communications found that 73 % of consumers are happy to pay a higher retail price for a food or drink product made with ingredients they recognize . because goodwheat increases the nutrient density directly in the primary grains and oils , it provides the mechanism for food formulation simplification naturally , cost effectively and in a time-frame to meet evolving consumer demands . the brand launch is a key element of the company 's go-to-market strategy to achieve greater value for its innovations by participating in downstream consumer revenue opportunities . we designed the brand to make an immediate connection with consumers that products made with goodwheat meet their demands for healthier wheat options that also taste great . the goodwheat brand encompasses our current and future non-gm wheat portfolio of high fiber resistant starch ( rs ) and reduced gluten wheat varieties , as well as future wheat innovations . in october 2019 , the u.s. patent and trademark office granted us the latest patents for extended shelf life wheat , the newest trait in our non-genetically modified wheat portfolio . this new trait was designed to promote whole wheat consumption by improving the shelf life and taste of whole grain wheat products . 45 with additional patents granted in 2019 , we now hold more than 15 global patents on our high fiber resistant starch wheat , protecting both bread wheat and durum ( pasta ) wheat . claims granted in 2019 strengthen our intellectual property for our resistant starch portfolio of products . story_separator_special_tag through december 31 , 2018. the estimated fair value of the purchase agreement common stock adjustment feature was $ 4.6 million , the estimated fair value of the purchase agreement common stock warrants decreased by $ 7.9 million , and the estimated fair value of the june offering common stock warrants decreased by $ 6.3 million due to the decrease in the company 's stock price . the purchase agreement common stock adjustment feature liability was released to equity following the final fair value remeasurement in may 2018. see note 11. offering costs offering costs for the year ended december 31 , 2019 of $ 0.7 million is comprised of the placement agent fees , placement agent warrants , advisory fees , and legal and accounting fees related to the june 2019 and september 2019 offerings . offering costs for the year ended december 31 , 2018 of $ 2.6 million is comprised of $ 1.8 million associated with the march 2018 private placement and $ 721,000 related to the june 2018 offering and the june 2018 private placement . income tax provision the income tax provision decreased $ 8,000 or 80 % for the year ended december 31 , 2019 compared to the year ended december 31 , 2018. see note 15 . 51 seasonality we and our commercial partners operate in different geographies around the world and conduct field trials used for data generation , which must be conducted during the appropriate growing seasons for particular crops and markets . often , there is only one crop-growing season per year for certain crops and markets . similarly , climate conditions and other factors that may influence the sales of our products may vary from season to season and year to year . in particular , weather conditions , including natural disasters such as heavy rains , hurricanes , hail , floods , tornadoes , freezing conditions , drought or fire , may affect the timing and outcome of field trials , which may delay milestone payments and the commercialization of products incorporating our seed traits . in the future , sales of commercial products that incorporate our seed traits will vary based on crop growing seasons and weather patterns within particular regions . the level of seasonality in our business overall is difficult to evaluate at this time due to our relatively early stage of development , our relatively limited number of commercialized products , our expansion into new geographical markets and our introduction of new products and traits . liquidity , capital resources and going concern we have funded our operations primarily with the net proceeds from our initial public offering , private placements of equity securities and debt , as well as proceeds from the sale of our sonova products and payments under license agreements , contract research agreements and government grants . our principal use of cash is to fund our operations , which are primarily focused on completing development and commercializing our quality seed traits . this includes replicating field trials , coordinating with our partners on their development programs and scaling harvest production of wheat , hemp and soy . as of december 31 , 2019 , we had cash and cash equivalents of $ 8.4 million and short-term investments of $ 16.9 million . for the years ended december 31 , 2019 and 2018 , the company had net losses of $ 28.9 million and $ 13.5 million , respectively , and net cash used in operations of $ 17.2 million and $ 13.6 million , respectively . as is disclosed in note 11 , the company obtained funding through two separate arrangements during the first half of 2018 and two offerings during june 2019 and september 2019. on march 19 , 2018 , the company entered into securities purchase agreements with institutional investors in connection with a private placement of common stock and warrants in the amount of $ 10 million , exclusive of any related transaction fees . on june 11 , 2018 , the company entered into agreements with institutional investors through a registered direct offering in the amount of $ 14 million , exclusive of any related transaction fees . on june 12 , 2019 , the company entered into agreements with institutional investors through a registered direct offering in the amount of $ 7.5 million exclusive of any related transaction fees . in august and september 2019 , investors exercised warrants , generating cash proceeds totaling $ 5.3 million . on september 5 , 2019 , the company entered into agreements with institutional investors through a registered direct offering in the amount of $ 10 million exclusive of any related transaction fees . we believe that our existing cash , cash equivalents and short-term investments will not be sufficient to meet our anticipated cash requirements for at least the next 12 months which raises substantial doubt about the company 's ability to continue as a going concern . see note 1 of the notes to the consolidated financial statements for more information . we may seek to raise additional funds through debt or equity financings , if necessary . we may also consider entering into additional partner arrangements . our sale of additional equity would result in dilution to our stockholders . our incurrence of debt would result in debt service obligations , and the instruments governing our debt could provide for additional operating and financing covenants that would restrict our operations . if we do require additional funds and are not able to secure adequate additional funding , we may be forced to reduce our spending , extend payment terms with our suppliers , liquidate assets , or suspend or curtail planned development programs . any of these actions could materially harm our business , results of operations and financial condition . at this time , there is significant uncertainty relating to the trajectory of the novel coronavirus outbreak and impact of related responses . the

white mountains also agreed to contribute up to an additional $ 200 million of equity capital to ark in 2021. in accordance with the ark spa , in the fourth quarter of 2020 white mountains pre-funded/placed in escrow a total of $ 646 million in preparation for closing the transaction , which is reflected on the balance sheet within the other operations segment as of december 31 , 2020. on january 1 , 2021 , white mountains closed the transaction in accordance with the terms of the ark spa . at closing , white mountains owned 72 % of ark on a basic shares outstanding basis ( 63 % on a fully-diluted , fully-converted basis , taking account of management 's equity incentives ) . if the additional $ 200 million is contributed in full , white mountains will own 77 % of ark on a basic shares outstanding basis ( 68 % on a fully-diluted , fully-converted basis ) . management 's equity incentives are subject to an 8 % rate of return threshold with no catch-up . the remaining shares are owned by employees . in the future , management rollover shareholders could earn additional shares in the company if and to the extent that white mountains achieves certain multiple of invested capital return thresholds . these additional shares are generally eligible to vest in three equal tranches at multiple on invested capital ( “ moic ” ) thresholds of 2.0x , 2.5x and 3.0x . if fully earned , these additional shares would represent 13 % of the shares outstanding at closing . in the january 2021 renewal season , ark wrote gross written premiums in excess of $ 270 million . during 2020 , white mountains deployed approximately $ 1.0 billion in new business opportunities , including commitments related to the ark transaction , which closed on january 1 , 2021. also during 2020 , white mountains repurchased and retired 99,087 of its common shares for $ 85 million . as a result , white mountains 's capital base is , for the time being , more or less fully deployed . 31 gross written premiums and msc collected in the hg global/bam segment totaled $ 131 million in 2020 , compared to $ 107 million in 2019. total pricing was 76 basis points in 2020 , compared to 83 basis points in 2019. bam insured municipal bonds with par value of $ 17.3 billion in 2020 , compared to $ 12.8 billion in 2019. during 2020 , bam completed an assumed reinsurance transaction to insure municipal bonds with a par value of $ 37 million and , during 2019 , bam completed an assumed reinsurance transaction to insure municipal bonds with a par value of $ 1.1 billion . in december 2020 , bam made a $ 30 million cash payment of principal and interest on the bam surplus notes held by hg global . in january 2020 , bam made a one-time $ 65 million cash payment of principal and interest on the bam surplus notes held by hg global . bam 's total claims paying resources were $ 987 million as of december 31 , 2020 , compared to $ 938 million as of december 31 , 2019. nsm reported pre-tax loss of $ 13 million , adjusted ebitda of $ 59 million , and commission and other revenues of $ 285 million in 2020 , compared to pre-tax loss of $ 2 million , adjusted ebitda of $ 48 million , and commission and other revenues of $ 233 million in 2019. results for the year ended december 31 , 2020 include the results , from the date of acquisition , of kingsbridge , a leading provider of commercial lines insurance and consulting services for the professional contractor and freelancer markets in the united kingdom , which was acquired on april 7 , 2020 , and embrace , a nationwide provider of pet health insurance for dogs and cats , which nsm acquired on april 1 , 2019. kudu reported pre-tax income of $ 28 million and total revenues of $ 46 million in 2020 , compared to pre-tax income of $ 11 million and total revenues of $ 21 million for the period from april 4 , 2019 , the date of the kudu transaction , through december 31 , 2019. for the twelve months ended december 31 , 2020 , kudu deployed $ 121 million , including transaction costs , in five asset management firms and has now deployed a total of $ 386 million , including transaction costs , in 13 asset management firms with combined assets under management of approximately $ 45 billion , spanning a range of asset classes , including real estate , real assets , wealth management , hedge funds , private equity and alternative credit strategies . white mountains 's pre-tax total return on invested assets was 31.9 % in 2020. this return included $ 746 million of net investment income and net realized and unrealized investment gains from mediaalpha . excluding mediaalpha , the total return on invested assets was 4.6 % in 2020. white mountains 's pre-tax total return on invested assets was 20.4 % in 2019. this return included $ 188 million of net investment income and net unrealized investment gains from mediaalpha . excluding mediaalpha , the total return on invested assets was 13.0 % in 2019. investment returns in 2020 were impacted by white mountains 's decision to sell its portfolio of common equity securities during the third and fourth quarter of 2020 in preparation of funding the ark transaction as equity markets were up strongly in the fourth quarter . story_separator_special_tag all bam-insured bond payments due through february 15 , 2021 have been made by insureds . bam currently has no insured bonds on its insured credit watchlist . hg global/bam results—year ended december 31 , 2019 versus year ended december 31 , 2018 gross written premiums and msc collected in the hg global/bam segment totaled $ 107 million in both 2019 and 2018. bam insured $ 12.8 billion of municipal bonds , $ 10.4 billion of which were in the primary market , in 2019 , compared to $ 12 billion of municipal bonds , $ 8.8 billion of which were in the primary market , in 2018. during 2019 and 2018 , bam completed assumed reinsurance transactions to insure municipal bonds with a par value of $ 1.1 billion and $ 2.2 billion , respectively . total pricing , which reflects both gross written premiums and msc from new business , decreased to 83 basis points in 2019 , compared to 93 basis points in 2018. see “ non-gaap financial measures ” on page 63. the decrease in total pricing was driven primarily by a decrease in pricing in the primary market . pricing in the primary market decreased to 51 basis points in 2019 , compared to 71 basis points in 2018 , driven primarily by lower interest rates and tighter credit spreads . pricing in the assumed reinsurance and secondary markets , which is more transaction-specific than pricing in the primary market , increased to 219 basis points in 2019 , compared to 150 basis points in 2018 , partially offsetting the decline in pricing in the primary market . 39 the following table presents the gross par value of primary and secondary market policies issued , the gross par value of assumed reinsurance , the gross written premiums and msc collected and total pricing for the twelve months ended december 31 , 2019 and 2018 : replace_table_token_16_th ( 1 ) see “ non-gaap financial measures ” on page 63 . ( 2 ) during 2019 , bam issued policy endorsements for certain policies issued in periods prior to the second quarter of 2018. the impact of the policy endorsements for the year ended december 31 , 2019 was a decrease to bam 's gross written premiums of $ 13.4 and an increase to msc collected of $ 13.4. hg global reported gaap pre-tax income of $ 54 million in 2019 , compared to $ 32 million in 2018. the increase in pre- tax income was driven primarily by higher returns in hg global 's investment portfolio . hg global 's results in 2019 included $ 27 million of interest income on the bam surplus notes , compared to $ 23 million in 2018. bam is a mutual insurance company that is owned by its members . bam 's results are consolidated into white mountains 's gaap financial statements and attributed to non-controlling interests . white mountains reported gaap pre-tax losses from bam of $ 44 million in 2019 , compared to $ 61 million in 2018. the decrease in the pre-tax loss was driven primarily by higher returns in bam 's investment portfolio . bam 's results included $ 27 million of interest expense on the bam surplus notes and $ 49 million of general and administrative expenses in 2019 , compared to $ 23 million of interest expense on the bam surplus notes and $ 47 million of general and administrative expenses in 2018. in december 2019 , bam made a $ 32 million cash payment ( which included a one-time $ 10 million cash payment ) of principal and interest on the bam surplus notes held by hg global . of this payment , $ 24 million was a repayment of principal held in the supplemental trust and $ 8 million was a payment of accrued interest held outside the supplemental trust . in december 2018 , bam made a $ 23 million cash payment of principal and interest on the bam surplus notes held by hg global . of this payment , $ 18 million was a repayment of principal held in the supplemental trust , $ 1 million was a payment of accrued interest held in the supplemental trust and $ 4 million was a payment of accrued interest held outside the supplemental trust . in january 2020 , white mountains updated its debt service model for the bam surplus notes to reflect ( i ) the cash payments of principal and interest on the bam surplus notes made in december 2019 and january 2020 , ( ii ) the amendments made to the terms of the bam surplus notes in january 2020 , including the extension of the variable interest rate period and ( iii ) in light of the current interest rate environment , a more conservative forecast of future operating results for bam . the changes to the debt service model resulted in slower modeled future payments on the bam surplus notes and , in turn , a $ 20 million increase to the time value of money discount on the bam surplus notes as reflected in adjusted book value per share as of december 31 , 2019. claims paying resources bam 's claims paying resources represent the capital and other financial resources bam has available to pay claims and , as such , is a key indication of bam 's financial strength . bam 's claims paying resources were $ 987 million as of december 31 , 2020 , compared to $ 938 million as of december 31 , 2019 and $ 871 million as of december 31 , 2018. the increase in claims paying resources was driven primarily by increases in the statutory value of the collateral trusts resulting from positive cash flow from operations , partially offset by the portion of cash payments on the bam surplus notes related to accrued interest held outside the supplemental trust . 40 the following table presents bam 's total

cash flows detailed information concerning white mountains 's cash flows during 2020 , 2019 and 2018 follows : cash flows from operations for the years ended 2020 , 2019 and 2018 net cash flows used for operations was $ 61 million , $ 121 million and $ 31 million for the years ended 2020 , 2019 and 2018. cash used for operations was lower in 2020 compared to 2019 , which was driven primarily by $ 55 million of net investment income received in 2020 from a dividend recapitalization at mediaalpha . cash used for operations was higher in 2019 compared to 2018 , driven primarily by kudu 's deployments in asset management firms . white mountains does not believe these trends will have a meaningful impact on its future liquidity or its ability to meet its future cash requirements . as of december 31 , 2020 , the company and its intermediate holding companies had $ 464 million of net unrestricted cash , short-term investments and fixed maturity investments , $ 802 million of mediaalpha common stock , and $ 173 million of private equity funds and the ils funds . acquisitions and dispositions during 2020 , kudu deployed $ 121 million ( including approximately $ 3 million of transaction costs ) in four asset management firms and has now deployed a total of $ 386 million in 13 asset management firms . during 2019 , kudu deployed $ 203 million in six asset management firms , of which $ 121 million ( including approximately $ 3 million of transaction costs ) was funded subsequent to the date of the kudu transaction .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```cash flows detailed information concerning white mountains 's cash flows during 2020 , 2019 and 2018 follows : cash flows from operations for the years ended 2020 , 2019 and 2018 net cash flows used for operations was $ 61 million , $ 121 million and $ 31 million for the years ended 2020 , 2019 and 2018. cash used for operations was lower in 2020 compared to 2019 , which was driven primarily by $ 55 million of net investment income received in 2020 from a dividend recapitalization at mediaalpha . cash used for operations was higher in 2019 compared to 2018 , driven primarily by kudu 's deployments in asset management firms . white mountains does not believe these trends will have a meaningful impact on its future liquidity or its ability to meet its future cash requirements . as of december 31 , 2020 , the company and its intermediate holding companies had $ 464 million of net unrestricted cash , short-term investments and fixed maturity investments , $ 802 million of mediaalpha common stock , and $ 173 million of private equity funds and the ils funds . acquisitions and dispositions during 2020 , kudu deployed $ 121 million ( including approximately $ 3 million of transaction costs ) in four asset management firms and has now deployed a total of $ 386 million in 13 asset management firms . during 2019 , kudu deployed $ 203 million in six asset management firms , of which $ 121 million ( including approximately $ 3 million of transaction costs ) was funded subsequent to the date of the kudu transaction . ``` Suspicious Activity Report : white mountains also agreed to contribute up to an additional $ 200 million of equity capital to ark in 2021. in accordance with the ark spa , in the fourth quarter of 2020 white mountains pre-funded/placed in escrow a total of $ 646 million in preparation for closing the transaction , which is reflected on the balance sheet within the other operations segment as of december 31 , 2020. on january 1 , 2021 , white mountains closed the transaction in accordance with the terms of the ark spa . at closing , white mountains owned 72 % of ark on a basic shares outstanding basis ( 63 % on a fully-diluted , fully-converted basis , taking account of management 's equity incentives ) . if the additional $ 200 million is contributed in full , white mountains will own 77 % of ark on a basic shares outstanding basis ( 68 % on a fully-diluted , fully-converted basis ) . management 's equity incentives are subject to an 8 % rate of return threshold with no catch-up . the remaining shares are owned by employees . in the future , management rollover shareholders could earn additional shares in the company if and to the extent that white mountains achieves certain multiple of invested capital return thresholds . these additional shares are generally eligible to vest in three equal tranches at multiple on invested capital ( “ moic ” ) thresholds of 2.0x , 2.5x and 3.0x . if fully earned , these additional shares would represent 13 % of the shares outstanding at closing . in the january 2021 renewal season , ark wrote gross written premiums in excess of $ 270 million . during 2020 , white mountains deployed approximately $ 1.0 billion in new business opportunities , including commitments related to the ark transaction , which closed on january 1 , 2021. also during 2020 , white mountains repurchased and retired 99,087 of its common shares for $ 85 million . as a result , white mountains 's capital base is , for the time being , more or less fully deployed . 31 gross written premiums and msc collected in the hg global/bam segment totaled $ 131 million in 2020 , compared to $ 107 million in 2019. total pricing was 76 basis points in 2020 , compared to 83 basis points in 2019. bam insured municipal bonds with par value of $ 17.3 billion in 2020 , compared to $ 12.8 billion in 2019. during 2020 , bam completed an assumed reinsurance transaction to insure municipal bonds with a par value of $ 37 million and , during 2019 , bam completed an assumed reinsurance transaction to insure municipal bonds with a par value of $ 1.1 billion . in december 2020 , bam made a $ 30 million cash payment of principal and interest on the bam surplus notes held by hg global . in january 2020 , bam made a one-time $ 65 million cash payment of principal and interest on the bam surplus notes held by hg global . bam 's total claims paying resources were $ 987 million as of december 31 , 2020 , compared to $ 938 million as of december 31 , 2019. nsm reported pre-tax loss of $ 13 million , adjusted ebitda of $ 59 million , and commission and other revenues of $ 285 million in 2020 , compared to pre-tax loss of $ 2 million , adjusted ebitda of $ 48 million , and commission and other revenues of $ 233 million in 2019. results for the year ended december 31 , 2020 include the results , from the date of acquisition , of kingsbridge , a leading provider of commercial lines insurance and consulting services for the professional contractor and freelancer markets in the united kingdom , which was acquired on april 7 , 2020 , and embrace , a nationwide provider of pet health insurance for dogs and cats , which nsm acquired on april 1 , 2019. kudu reported pre-tax income of $ 28 million and total revenues of $ 46 million in 2020 , compared to pre-tax income of $ 11 million and total revenues of $ 21 million for the period from april 4 , 2019 , the date of the kudu transaction , through december 31 , 2019. for the twelve months ended december 31 , 2020 , kudu deployed $ 121 million , including transaction costs , in five asset management firms and has now deployed a total of $ 386 million , including transaction costs , in 13 asset management firms with combined assets under management of approximately $ 45 billion , spanning a range of asset classes , including real estate , real assets , wealth management , hedge funds , private equity and alternative credit strategies . white mountains 's pre-tax total return on invested assets was 31.9 % in 2020. this return included $ 746 million of net investment income and net realized and unrealized investment gains from mediaalpha . excluding mediaalpha , the total return on invested assets was 4.6 % in 2020. white mountains 's pre-tax total return on invested assets was 20.4 % in 2019. this return included $ 188 million of net investment income and net unrealized investment gains from mediaalpha . excluding mediaalpha , the total return on invested assets was 13.0 % in 2019. investment returns in 2020 were impacted by white mountains 's decision to sell its portfolio of common equity securities during the third and fourth quarter of 2020 in preparation of funding the ark transaction as equity markets were up strongly in the fourth quarter . story_separator_special_tag all bam-insured bond payments due through february 15 , 2021 have been made by insureds . bam currently has no insured bonds on its insured credit watchlist . hg global/bam results—year ended december 31 , 2019 versus year ended december 31 , 2018 gross written premiums and msc collected in the hg global/bam segment totaled $ 107 million in both 2019 and 2018. bam insured $ 12.8 billion of municipal bonds , $ 10.4 billion of which were in the primary market , in 2019 , compared to $ 12 billion of municipal bonds , $ 8.8 billion of which were in the primary market , in 2018. during 2019 and 2018 , bam completed assumed reinsurance transactions to insure municipal bonds with a par value of $ 1.1 billion and $ 2.2 billion , respectively . total pricing , which reflects both gross written premiums and msc from new business , decreased to 83 basis points in 2019 , compared to 93 basis points in 2018. see “ non-gaap financial measures ” on page 63. the decrease in total pricing was driven primarily by a decrease in pricing in the primary market . pricing in the primary market decreased to 51 basis points in 2019 , compared to 71 basis points in 2018 , driven primarily by lower interest rates and tighter credit spreads . pricing in the assumed reinsurance and secondary markets , which is more transaction-specific than pricing in the primary market , increased to 219 basis points in 2019 , compared to 150 basis points in 2018 , partially offsetting the decline in pricing in the primary market . 39 the following table presents the gross par value of primary and secondary market policies issued , the gross par value of assumed reinsurance , the gross written premiums and msc collected and total pricing for the twelve months ended december 31 , 2019 and 2018 : replace_table_token_16_th ( 1 ) see “ non-gaap financial measures ” on page 63 . ( 2 ) during 2019 , bam issued policy endorsements for certain policies issued in periods prior to the second quarter of 2018. the impact of the policy endorsements for the year ended december 31 , 2019 was a decrease to bam 's gross written premiums of $ 13.4 and an increase to msc collected of $ 13.4. hg global reported gaap pre-tax income of $ 54 million in 2019 , compared to $ 32 million in 2018. the increase in pre- tax income was driven primarily by higher returns in hg global 's investment portfolio . hg global 's results in 2019 included $ 27 million of interest income on the bam surplus notes , compared to $ 23 million in 2018. bam is a mutual insurance company that is owned by its members . bam 's results are consolidated into white mountains 's gaap financial statements and attributed to non-controlling interests . white mountains reported gaap pre-tax losses from bam of $ 44 million in 2019 , compared to $ 61 million in 2018. the decrease in the pre-tax loss was driven primarily by higher returns in bam 's investment portfolio . bam 's results included $ 27 million of interest expense on the bam surplus notes and $ 49 million of general and administrative expenses in 2019 , compared to $ 23 million of interest expense on the bam surplus notes and $ 47 million of general and administrative expenses in 2018. in december 2019 , bam made a $ 32 million cash payment ( which included a one-time $ 10 million cash payment ) of principal and interest on the bam surplus notes held by hg global . of this payment , $ 24 million was a repayment of principal held in the supplemental trust and $ 8 million was a payment of accrued interest held outside the supplemental trust . in december 2018 , bam made a $ 23 million cash payment of principal and interest on the bam surplus notes held by hg global . of this payment , $ 18 million was a repayment of principal held in the supplemental trust , $ 1 million was a payment of accrued interest held in the supplemental trust and $ 4 million was a payment of accrued interest held outside the supplemental trust . in january 2020 , white mountains updated its debt service model for the bam surplus notes to reflect ( i ) the cash payments of principal and interest on the bam surplus notes made in december 2019 and january 2020 , ( ii ) the amendments made to the terms of the bam surplus notes in january 2020 , including the extension of the variable interest rate period and ( iii ) in light of the current interest rate environment , a more conservative forecast of future operating results for bam . the changes to the debt service model resulted in slower modeled future payments on the bam surplus notes and , in turn , a $ 20 million increase to the time value of money discount on the bam surplus notes as reflected in adjusted book value per share as of december 31 , 2019. claims paying resources bam 's claims paying resources represent the capital and other financial resources bam has available to pay claims and , as such , is a key indication of bam 's financial strength . bam 's claims paying resources were $ 987 million as of december 31 , 2020 , compared to $ 938 million as of december 31 , 2019 and $ 871 million as of december 31 , 2018. the increase in claims paying resources was driven primarily by increases in the statutory value of the collateral trusts resulting from positive cash flow from operations , partially offset by the portion of cash payments on the bam surplus notes related to accrued interest held outside the supplemental trust . 40 the following table presents bam 's total

our revenue is generated from a combination of third-party payors , institutions and self-payors , including private and government employers . payments for our products by third party payors have been made primarily through case-by-case determinations . third-party payors include , without limitation , private insurance plans and managed care programs , government programs including the us department of veterans affairs , worker 's compensation and medicare and medicaid . we expect that third-party payors will be an increasingly important source of revenue in the future . in december 2015 , the va issued a national policy for the evaluation , training and procurement of rewalk personal exoskeleton systems for all qualifying veterans across the united states . the va policy is the first national coverage policy in the united states for qualifying individuals who have suffered spinal cord injury . all of our rewalk systems sold until the end of the current year are covered by a two-year warranty from the date of purchase , which is included in the purchase price . we offer customers the ability to purchase , any time during the initial warranty period , an extended warranty for up to three additional years . both warranties cover all elements of the rewalk system , including the batteries , other than normal wear and tear . in the beginning of 2018 we updated our service policy for new devices sold to include a five-year warranty . 64 revenues are presented net of the amounts of any provision we record for expected future product returns . cost of revenues and gross profit ( loss ) cost of revenue consists primarily of systems purchased from our outsourced manufacturer , sanmina , salaries , personnel costs including non-cash share based compensation , associated with manufacturing and inventory management , training and inspection , warranty and service costs , shipping and handling and manufacturing startup and transition costs . prior to the first quarter of 2014 , when we completed the manufacturing transition to sanmina , cost of revenues also included costs of components , compensation related costs associated with manufacturing and costs to transition manufacturing to sanmina . cost of revenues also includes royalties and expenses related to royalty-bearing research and development grants and sales and marketing grants . our gross profit ( loss ) and gross margin as a percentage of sales is influenced by a number of factors , including primarily the volume and price of our products sold and fluctuations in our cost of revenues . certain one-time expenses also impact gross margins including a 2014 expense relating to the early settlement , at a discount , of a royalty-bearing grant to the bird foundation and 2015 and 2016 costs to transition manufacturing to the rewalk personal 6.0 model . we expect gross profit ( loss ) as a percentage of sales will improve in the future as we increase our sales volumes and decrease the product manufacturing costs . operating expenses research and development expenses , net research and development expenses , net consist primarily of salaries , related personnel costs including share-based compensation , supplies , materials and expenses related to product design and development , clinical studies , regulatory submissions , patent costs , sponsored research costs and other expenses related to our product development and research programs . we expense all research and development expenses as they are incurred . we believe that continued investment in research and development is crucial to attaining our strategic product objectives . research and development expenses are presented net of the amount of any grants we receive for research and development in the period in which we receive the grant . we previously received grants and other funding from the bird foundation and the israel innovation authority , or “ iia ” ( formerly known as the office of the chief scientist ) . certain of those grants require us to pay royalties on sales of rewalk systems , which are recorded as cost of revenues . we may receive additional funding from these entities or others in the future . see “ grants and other funding ” below . sales and marketing expenses our sales and marketing expenses consist primarily of salaries , related personnel costs including share-based compensation for sales , marketing and reimbursement personnel , travel , marketing and public relations activities and consulting costs . also included in the sales and marketing expenses are the costs associated with our reimbursement activities in the united states and germany . general and administrative expenses our general and administrative expenses consist primarily of salaries , related personnel costs including share-based compensation for our administrative , finance , and general management personnel , professional services and insurance . financial income ( expenses ) , net financial income and expenses consist of bank commissions , foreign exchange gains and losses , interest earned on investments in short term deposits , and revaluation of the fair value of warrants to purchase our preferred shares and expenses related to our convertible loans , which were issued in 2013 and are no longer outstanding . warrants to purchase our convertible preferred shares were classified as a liability on our consolidated balance sheet at fair value . the warrants were subject to revaluation at each balance sheet date and any change in fair value is recognized as a component of financial income ( expense ) , net , on our consolidated statements of operations . all such warrants were exercised , expired or converted into warrants to purchase ordinary shares in connection with our initial public offering , and therefore as of december 31 , 2014 and for periods beginning with the fourth quarter of 2014 , we no longer record any liability in respect of them on our balance sheet or financial expenses in respect of them on our statement of operations . interest income consists of interest earned on our cash and cash equivalent balances . story_separator_special_tag we have established a full valuation allowance with respect to our deferred tax assets . 72 asu 2015-17 , “ balance sheet classification of deferred taxes `` provides presentation requirements to classify deferred tax assets and liabilities , along with any related valuation allowance , are classified as non-current on the balance sheet . we account for uncertain tax positions in accordance with asc 740 and recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities , based on the technical merits of the position . the tax benefits recognized in the financial statements from such a position should be measured based on the largest benefit that has a greater than 50 % likelihood of being realized upon ultimate settlement . accordingly , we report a liability for unrecognized tax benefits resulting from uncertain tax positions taken or expected to be taken in a tax return . we recognize interest and penalties , if any , related to unrecognized tax benefits in tax expense . new and revised financial accounting standards the jobs act permits emerging growth companies such as us to delay adopting new or revised accounting standards until such time as those standards apply to private companies . we have irrevocably elected not to avail ourselves of this and , therefore , we are subject to the same new or revised accounting standards as other public companies that are not emerging growth companies . recently issued and adopted accounting pronouncements a discussion of recent accounting pronouncements is included in note 2u , new accounting pronouncements to our consolidated financial statements in this annual report . liquidity and capital resources sources of liquidity and outlook since inception , we have funded our operations primarily through the sale of certain of our equity securities and convertible notes to investors in private placements , the sale of our ordinary shares in public offerings and the incurrence of bank debt . as of december 31 , 2017 , the company had cash and cash equivalents of $ 14.6 million . the company has an accumulated deficit in the total amount of $ 131.2 million as of december 31 , 2017 and further losses are anticipated in the development of its business . those factors raise substantial doubt about the company 's ability to continue as a going concern . the ability to continue as a going concern is dependent upon the company obtaining the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they come due . the company intends to finance operating costs over the next twelve months with existing cash on hand , reducing operating spend , issuances under the company 's atm offering program , or other future issuances of equity and debt securities , including the recently signed private placement of ordinary shares to timwell , or through a combination of the foregoing . however , the company will need to seek additional sources of financing if the company require more funds than anticipated during the next 12 months or in later periods . the accompanying consolidated financial statements have been prepared assuming the company will continue as a going concern , which contemplates the realization of assets and liabilities and commitments in the normal course of business . the consolidated financial statements for the year ended december 31 , 2017 do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classification of liabilities that may result from uncertainty related to the company 's ability to continue as a going concern . our anticipated primary uses of cash are ( i ) sales , marketing and reimbursement expenses related to market development activities and broadening third-party payor coverage , and ( ii ) research and development costs related to , in the shorter term , our restore device that will assist patients who had stroke , and , in the longer term , developing our next generation of rewalk with design improvements and building upon our technological platform to address new medical indications that affect the ability to walk including cerebral palsy , parkinson 's disease and elderly assistance . our future cash requirements will depend on many factors , including our rate of revenue growth , the expansion of our sales and marketing activities , the timing and extent of our spending on research and development efforts and international expansion . if our current estimates of revenue , expenses or capital or liquidity requirements change or are inaccurate , we may seek to sell additional equity or debt securities , arrange for additional bank debt financing or refinance our indebtedness . there can be no assurance that we will be able to raise such funds on acceptable terms . for more information , see “ part i , item 1a . risk factors-we have concluded that there are substantial doubts as to our ability to continue as a going concern . ” 73 loan agreement with kreos and related warrant to purchase ordinary shares on december 30 , 2015 , we entered into the loan agreement with kreos pursuant to which kreos extended a line of credit to us in the amount of $ 20 million . on january 4 , 2016 , we drew down $ 12.0 million under the loan agreement . under the terms of the loan agreement we were entitled to draw down up to an additional $ 8.0 million until december 31 , 2016 , if we raised $ 10.0 million or more in the issuance of shares of our capital stock ( including debt convertible into shares of our capital stock ) by december 31 , 2016. on december 28 , 2016 , we drew down the remaining $ 8.0 million available under the loan agreement . interest is payable monthly in

loss on extinguishment of debt loss on extinguishment of debt of $ 313 thousand during 2017 is due to amending of our debt under the loan agreement with kreos , such that $ 3.0 million in principal is now subject to the kreos convertible note . the entry into the kreos convertible note , which decreased the outstanding principal amount under the loan agreement from $ 17.2 million to $ 14.2 million , resulted in extinguishment of debt accounting treatment . 68 financial expenses , net our financial expenses , net for 2017 and 2016 were as follows ( in thousands ) : replace_table_token_9_th financial expenses , net , increased by $ 0.2 million , or 11 % during 2017 compared to 2016 . this increase is mainly attributable to interest expense related to the loan agreement with kreos . income tax our income tax for 2017 and 2016 was as follows ( in thousands ) : replace_table_token_10_th income taxes increased by $ 116 thousand or 3,867 % during 2017 compared to 2016 . this increase is mainly related to a deferred tax expense as a result of the tax rate change in the u.s due to the tcja .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```loss on extinguishment of debt loss on extinguishment of debt of $ 313 thousand during 2017 is due to amending of our debt under the loan agreement with kreos , such that $ 3.0 million in principal is now subject to the kreos convertible note . the entry into the kreos convertible note , which decreased the outstanding principal amount under the loan agreement from $ 17.2 million to $ 14.2 million , resulted in extinguishment of debt accounting treatment . 68 financial expenses , net our financial expenses , net for 2017 and 2016 were as follows ( in thousands ) : replace_table_token_9_th financial expenses , net , increased by $ 0.2 million , or 11 % during 2017 compared to 2016 . this increase is mainly attributable to interest expense related to the loan agreement with kreos . income tax our income tax for 2017 and 2016 was as follows ( in thousands ) : replace_table_token_10_th income taxes increased by $ 116 thousand or 3,867 % during 2017 compared to 2016 . this increase is mainly related to a deferred tax expense as a result of the tax rate change in the u.s due to the tcja . ``` Suspicious Activity Report : our revenue is generated from a combination of third-party payors , institutions and self-payors , including private and government employers . payments for our products by third party payors have been made primarily through case-by-case determinations . third-party payors include , without limitation , private insurance plans and managed care programs , government programs including the us department of veterans affairs , worker 's compensation and medicare and medicaid . we expect that third-party payors will be an increasingly important source of revenue in the future . in december 2015 , the va issued a national policy for the evaluation , training and procurement of rewalk personal exoskeleton systems for all qualifying veterans across the united states . the va policy is the first national coverage policy in the united states for qualifying individuals who have suffered spinal cord injury . all of our rewalk systems sold until the end of the current year are covered by a two-year warranty from the date of purchase , which is included in the purchase price . we offer customers the ability to purchase , any time during the initial warranty period , an extended warranty for up to three additional years . both warranties cover all elements of the rewalk system , including the batteries , other than normal wear and tear . in the beginning of 2018 we updated our service policy for new devices sold to include a five-year warranty . 64 revenues are presented net of the amounts of any provision we record for expected future product returns . cost of revenues and gross profit ( loss ) cost of revenue consists primarily of systems purchased from our outsourced manufacturer , sanmina , salaries , personnel costs including non-cash share based compensation , associated with manufacturing and inventory management , training and inspection , warranty and service costs , shipping and handling and manufacturing startup and transition costs . prior to the first quarter of 2014 , when we completed the manufacturing transition to sanmina , cost of revenues also included costs of components , compensation related costs associated with manufacturing and costs to transition manufacturing to sanmina . cost of revenues also includes royalties and expenses related to royalty-bearing research and development grants and sales and marketing grants . our gross profit ( loss ) and gross margin as a percentage of sales is influenced by a number of factors , including primarily the volume and price of our products sold and fluctuations in our cost of revenues . certain one-time expenses also impact gross margins including a 2014 expense relating to the early settlement , at a discount , of a royalty-bearing grant to the bird foundation and 2015 and 2016 costs to transition manufacturing to the rewalk personal 6.0 model . we expect gross profit ( loss ) as a percentage of sales will improve in the future as we increase our sales volumes and decrease the product manufacturing costs . operating expenses research and development expenses , net research and development expenses , net consist primarily of salaries , related personnel costs including share-based compensation , supplies , materials and expenses related to product design and development , clinical studies , regulatory submissions , patent costs , sponsored research costs and other expenses related to our product development and research programs . we expense all research and development expenses as they are incurred . we believe that continued investment in research and development is crucial to attaining our strategic product objectives . research and development expenses are presented net of the amount of any grants we receive for research and development in the period in which we receive the grant . we previously received grants and other funding from the bird foundation and the israel innovation authority , or “ iia ” ( formerly known as the office of the chief scientist ) . certain of those grants require us to pay royalties on sales of rewalk systems , which are recorded as cost of revenues . we may receive additional funding from these entities or others in the future . see “ grants and other funding ” below . sales and marketing expenses our sales and marketing expenses consist primarily of salaries , related personnel costs including share-based compensation for sales , marketing and reimbursement personnel , travel , marketing and public relations activities and consulting costs . also included in the sales and marketing expenses are the costs associated with our reimbursement activities in the united states and germany . general and administrative expenses our general and administrative expenses consist primarily of salaries , related personnel costs including share-based compensation for our administrative , finance , and general management personnel , professional services and insurance . financial income ( expenses ) , net financial income and expenses consist of bank commissions , foreign exchange gains and losses , interest earned on investments in short term deposits , and revaluation of the fair value of warrants to purchase our preferred shares and expenses related to our convertible loans , which were issued in 2013 and are no longer outstanding . warrants to purchase our convertible preferred shares were classified as a liability on our consolidated balance sheet at fair value . the warrants were subject to revaluation at each balance sheet date and any change in fair value is recognized as a component of financial income ( expense ) , net , on our consolidated statements of operations . all such warrants were exercised , expired or converted into warrants to purchase ordinary shares in connection with our initial public offering , and therefore as of december 31 , 2014 and for periods beginning with the fourth quarter of 2014 , we no longer record any liability in respect of them on our balance sheet or financial expenses in respect of them on our statement of operations . interest income consists of interest earned on our cash and cash equivalent balances . story_separator_special_tag we have established a full valuation allowance with respect to our deferred tax assets . 72 asu 2015-17 , “ balance sheet classification of deferred taxes `` provides presentation requirements to classify deferred tax assets and liabilities , along with any related valuation allowance , are classified as non-current on the balance sheet . we account for uncertain tax positions in accordance with asc 740 and recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities , based on the technical merits of the position . the tax benefits recognized in the financial statements from such a position should be measured based on the largest benefit that has a greater than 50 % likelihood of being realized upon ultimate settlement . accordingly , we report a liability for unrecognized tax benefits resulting from uncertain tax positions taken or expected to be taken in a tax return . we recognize interest and penalties , if any , related to unrecognized tax benefits in tax expense . new and revised financial accounting standards the jobs act permits emerging growth companies such as us to delay adopting new or revised accounting standards until such time as those standards apply to private companies . we have irrevocably elected not to avail ourselves of this and , therefore , we are subject to the same new or revised accounting standards as other public companies that are not emerging growth companies . recently issued and adopted accounting pronouncements a discussion of recent accounting pronouncements is included in note 2u , new accounting pronouncements to our consolidated financial statements in this annual report . liquidity and capital resources sources of liquidity and outlook since inception , we have funded our operations primarily through the sale of certain of our equity securities and convertible notes to investors in private placements , the sale of our ordinary shares in public offerings and the incurrence of bank debt . as of december 31 , 2017 , the company had cash and cash equivalents of $ 14.6 million . the company has an accumulated deficit in the total amount of $ 131.2 million as of december 31 , 2017 and further losses are anticipated in the development of its business . those factors raise substantial doubt about the company 's ability to continue as a going concern . the ability to continue as a going concern is dependent upon the company obtaining the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they come due . the company intends to finance operating costs over the next twelve months with existing cash on hand , reducing operating spend , issuances under the company 's atm offering program , or other future issuances of equity and debt securities , including the recently signed private placement of ordinary shares to timwell , or through a combination of the foregoing . however , the company will need to seek additional sources of financing if the company require more funds than anticipated during the next 12 months or in later periods . the accompanying consolidated financial statements have been prepared assuming the company will continue as a going concern , which contemplates the realization of assets and liabilities and commitments in the normal course of business . the consolidated financial statements for the year ended december 31 , 2017 do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classification of liabilities that may result from uncertainty related to the company 's ability to continue as a going concern . our anticipated primary uses of cash are ( i ) sales , marketing and reimbursement expenses related to market development activities and broadening third-party payor coverage , and ( ii ) research and development costs related to , in the shorter term , our restore device that will assist patients who had stroke , and , in the longer term , developing our next generation of rewalk with design improvements and building upon our technological platform to address new medical indications that affect the ability to walk including cerebral palsy , parkinson 's disease and elderly assistance . our future cash requirements will depend on many factors , including our rate of revenue growth , the expansion of our sales and marketing activities , the timing and extent of our spending on research and development efforts and international expansion . if our current estimates of revenue , expenses or capital or liquidity requirements change or are inaccurate , we may seek to sell additional equity or debt securities , arrange for additional bank debt financing or refinance our indebtedness . there can be no assurance that we will be able to raise such funds on acceptable terms . for more information , see “ part i , item 1a . risk factors-we have concluded that there are substantial doubts as to our ability to continue as a going concern . ” 73 loan agreement with kreos and related warrant to purchase ordinary shares on december 30 , 2015 , we entered into the loan agreement with kreos pursuant to which kreos extended a line of credit to us in the amount of $ 20 million . on january 4 , 2016 , we drew down $ 12.0 million under the loan agreement . under the terms of the loan agreement we were entitled to draw down up to an additional $ 8.0 million until december 31 , 2016 , if we raised $ 10.0 million or more in the issuance of shares of our capital stock ( including debt convertible into shares of our capital stock ) by december 31 , 2016. on december 28 , 2016 , we drew down the remaining $ 8.0 million available under the loan agreement . interest is payable monthly in

in march 2011 , the national development and reform commission announced that from may 2011 , each residential house must be marked clearly with a specific price as the ceiling price . apart from administrative measures , to further tighten liquidity , the people 's bank of china increased banks ' required reserve ratios six consecutive times and raised the benchmark interest rate three times since the beginning of the year , leaving a profound impact on the residential housing transaction volume . in 2011 , residential housing transaction volume in major cities nationwide recorded a decrease compared with that of the same period of 2010. the first-tier cities with stricter policies witnessed a more extensive decrease in transaction volume . under such changing policies and market environment , the company actively followed the macroeconomic control trends , strengthened the intensive corporate management and optimized the operating model of premium standardized housing . a number of key indicators continued to record substantial growth . during fiscal 2011 , the company achieved a total sales revenue amount of $ 56.9 million , an increase of 20 % over fiscal 2010 's total sales revenue of $ 47.3 million . our average selling price in fiscal 2011 was approximately $ 436 per square meter , increased by 22 % over fiscal 2010. our sales in fiscal 2011 were mainly generated from four projects , namely yanzhou pear garden , nandajie , mingzhu garden and central plaza . this achievement resulted from an effective strategy in reaction to the changes in the chinese real estate market and governmental policies , strengthened management of construction progress , strict cost controls , and an enhanced marketing force to increase the public recognition of our brand . t here also exist some uncertainties in our future sales trend which may impact our reported revenue in the near future . we recognize real estate sales revenue when all the criteria for revenue recognition have been met and the property has been delivered to buyers . our sales revenue is affected by the number of units delivered and also affected by fluctuations in market prices . most of our newly developed projects are high-rise buildings with longer construction periods . consequently , in certain future reporting periods , we may not have any new construction work completed and delivered to buyers . this may negatively impact our revenue in such periods . this is a characteristic of our business and uneven sales revenues from quarter to quarter is due in part to the rate at which units are completed and delivered to buyers . with respect to capital funding requirements , while many property developers must now worry about their debt leverage and working capital needs for debt repayment , in contrast , the company does not have any external debt obligations outstanding as at september 30 , 2011 except for a loan in the amount of $ 1,810,000 to its major shareholder . the company 's ample cash flows from sales and , if necessary , shareholder loans should provide financial support for its current development and operations . in order to fully implement our business plan , however , we may need to raise capital in future . our expectation , therefore , is that we will seek to access the capital markets in both the u.s. and china to obtain the funds we require . at the present time , however , we do not have commitments of funds from any source . 27 the government 's tightening policies should continue in 2012 , which may make real estate developers face more difficulties in obtaining land use rights and bank loans . these governmental policies will also negatively affect buyers ' confidence and consumption psychology . some buyers are taking a wait-and-see attitude and may delay their purchasing decision . such market conditions will impact our sales revenue to a certain degree . despite the declining transaction volume and cooling real estate market , housing prices in tier 3 and tier 4 cities and counties have not shown a substantial correction . meanwhile , with affordable housing construction still underway , it takes time for abundant affordable housing to appear in the market . the company therefore expects the purchase restrictions and price ceiling policies to continue , which however , should have less impact on the company 's products compared to the real estate markets in tier i and ii cities and counties . on the other hand , credit conditions will likely continue to tighten . the company expects to continue to focus on developing real estate properties in prime locations of tier 3 and tier 4 cities and counties . results of operation revenues we recognize revenue from the sales of real property in accordance with the full accrual method at the time of the closing of an individual unit sale . this occurs when title to or possession of the property is transferred to the buyer . a sale is not considered consummated until ( a ) the parties are bound by the terms of a contract , ( b ) all consideration has been exchanged , ( c ) any permanent financing of which the seller is responsible has been arranged , ( d ) all conditions precedent to closing have been performed , ( e ) the seller does not have substantial continuing involvement with the property , and ( f ) the usual risks and rewards of ownership have been transferred to the buyer . further , the buyer 's initial and continuing investment is adequate to demonstrate a commitment to pay for the property , and the buyer 's receivable , if any , is not subject to future subordination . story_separator_special_tag the average translation rates applied to the income statements accounts for the periods ended september 30 , 2011 and 2010 were 6.5377 rmb and 6.82135 rmb , respectively . story_separator_special_tag text-indent : 0pt ; margin-right : 0pt `` > 34 operating activities net cash used in operating activities during the twelve months ended september 30 , 2011 was $ 5,586,447 , consisting of net income of $ 18,719,938 , noncash adjustments of $ 137,059 and net changes in our operating assets and liabilities due to our expanded operating activities , including a decrease in restricted cash of $ 79,523 , an increase in advances to vendors and loans to outside parties of $ 1,403,056 which were made in order to maintain good relationships with the suppliers , an increase in real estate property completed of $ 7,284,509 , an increase in real estate property under development of $ 24,128,313 due to our expansion into multiple phases of the existing real estate projects during the year , increased security deposits for land use rights of $ 6,118,360 , increased accounts payable of $ 6,448,357 due to more progress achieved in multiple real estate projects , increased customer deposits in the amount of $ 7,372,965 which we were able to recognize as revenue when all conditions for revenue recognition were met , increased accrued expenses of $ 1,023,617 due to unpaid sales commissions and staff compensation , and decreased taxes payable of $ 71,217 due to an increase in our net income . the negative cash provided by operating activities is mainly attributable to our significant spending on real estate property under development and deposits for land use rights . net cash used in operating activities during the twelve months ended september 30 , 2010 was $ 12,253,101 , consisting of net income of $ 17,312,762 , noncash adjustments of $ 114,456 offset by net changes in our operating assets and liabilities due to our expanded operating activities , including an increase in restricted cash of $ 493,208 , an increase in loans to outside parties of $ 4,807,282 which were made in order to maintain good relationships with the suppliers , an increase in real estate property completed of $ 8,327,290 , a decrease in real estate property under development of $ 6,011,679 due to the completion of three projects during the year , decreased customer deposits in the amount of $ 888,119 which we were able to recognize as revenue because all conditions for revenue recognition were met , increased taxes payable of $ 2,456,598 due to an increase in our net income , and increased accrued expenses of $ 772,007. the increase of the cash provided by operating activities is mainly attributable to the decrease in real estate property under development and the increase in taxes payable . the decrease in real estate property is due to the increased completion of buildings of yangzhou pearl garden , mingzhu garden ( mingzhu nanyuan and mingzhu beiyuan ) , oriental mingzhu garden and nandajie ( mingzhu xinju ) . the increase in taxes payable resulted from the increase in revenue . net cash used in operating activities for the year ended september 30 , 2011 was $ 5,586,447 compared with a net cash provided by operating activities of $ 12,253,102 for the year ended september 30 , 2010 , a net decrease of $ 17,839,549 compared to the same period in 2010. investing activities cash flows used in investing activities were $ 490,755 in the twelve months ended september 30 , 2011 , compared to $ 7,696 in the twelve months ended september 30 , 2010. cash flows used in investing activities in the twelve months ended september 30 , 2011 increased by $ 483,755 compared to the same period in 2010 as a result of the purchase of a new office building in 2011. financing activities net cash flows provided by financing activities amounted to $ 1,810,000 in the twelve months ended september 30 , 2011 , which was a loan from our major shareholder . cash flows used in financing activities amounted to $ 674,353 in the twelve months ended september 30 , 2010 , which consisted of the repayment of loans . cash flows provided by financing activities for the year ended september 30 , 2011 increased by $ 2,484,353 to $ 1,810,000 , compared to $ 674,353 of cash flow used in financing activities in 2010. off-balance sheet arrangements we do not have any off-balance sheet arrangements . inflation inflation has not had a material impact on our business and we do not expect inflation to have a material impact on our business in the near future . 35 critical accounting policies and management estimates the discussion and analysis of our financial condition and results of operations are based upon our consolidated financial statements , which have been prepared in accordance with accounting principles generally accepted in the united states . the preparation of these consolidated financial statements requires us to make estimates and judgments that affect our reported assets , liabilities , revenues and expenses , and related disclosure of contingent assets and liabilities . we evaluate our estimates on an on-going basis and use them on historical experience and various other assumptions that are believed to be reasonable under the circumstances as the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources . actual results may differ from these estimates because of different assumptions or conditions . we believe the following critical accounting policies affect our significant estimates and judgments used in the preparation of our consolidated financial statements . these policies should be read in conjunction with note 2 of the notes to consolidated financial statements . principles of consolidation the company 's consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the united states of america ( “ u.s . gaap ” ) . the consolidated financial

liquidity and capital resources current assets and liabilities to date , we have financed our operations primarily through cash flows from operations and borrowings from a shareholder . as of september 30 , 2011 , the company had $ 32,523,841 in working capital , a decrease of $ 7,531,792 as compared to $ 40,055,633 as of september 30 , 2010. the decrease was primarily due to the increase of accounts payable related to the construction contractors which will be paid within a year after the settlement of the constructions and unpaid construction costs . the significant increase in account payables related to construction contractors were mainly due to more construction progress achieved in multiple real estate projects during 2011. total current assets increased to approximately $ 60.2 million at september 30 , 2011 from $ 59.3 million at september 30 , 2010. the primary changes in our current assets during this year were increases in advances to suppliers , our security deposit for land use rights and real estate property development completed and were offset by the decreases in cash and cash equivalents , restricted cash and real estate property under development . the decrease of cash from $ 12.6 million at september 30 , 2010 to $ 8.8 million as of september 30 , 2011 was due primarily to our spending $ 6.3 million for a security deposit for land use rights . the increase in advances to vendors and loans to outside parties from $ 6.7 million at september 30 , 2010 to $ 8.8 million as of september 30 , 2011 was attributed to our financial support to strengthen our relationship with our construction material suppliers .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```liquidity and capital resources current assets and liabilities to date , we have financed our operations primarily through cash flows from operations and borrowings from a shareholder . as of september 30 , 2011 , the company had $ 32,523,841 in working capital , a decrease of $ 7,531,792 as compared to $ 40,055,633 as of september 30 , 2010. the decrease was primarily due to the increase of accounts payable related to the construction contractors which will be paid within a year after the settlement of the constructions and unpaid construction costs . the significant increase in account payables related to construction contractors were mainly due to more construction progress achieved in multiple real estate projects during 2011. total current assets increased to approximately $ 60.2 million at september 30 , 2011 from $ 59.3 million at september 30 , 2010. the primary changes in our current assets during this year were increases in advances to suppliers , our security deposit for land use rights and real estate property development completed and were offset by the decreases in cash and cash equivalents , restricted cash and real estate property under development . the decrease of cash from $ 12.6 million at september 30 , 2010 to $ 8.8 million as of september 30 , 2011 was due primarily to our spending $ 6.3 million for a security deposit for land use rights . the increase in advances to vendors and loans to outside parties from $ 6.7 million at september 30 , 2010 to $ 8.8 million as of september 30 , 2011 was attributed to our financial support to strengthen our relationship with our construction material suppliers . ``` Suspicious Activity Report : in march 2011 , the national development and reform commission announced that from may 2011 , each residential house must be marked clearly with a specific price as the ceiling price . apart from administrative measures , to further tighten liquidity , the people 's bank of china increased banks ' required reserve ratios six consecutive times and raised the benchmark interest rate three times since the beginning of the year , leaving a profound impact on the residential housing transaction volume . in 2011 , residential housing transaction volume in major cities nationwide recorded a decrease compared with that of the same period of 2010. the first-tier cities with stricter policies witnessed a more extensive decrease in transaction volume . under such changing policies and market environment , the company actively followed the macroeconomic control trends , strengthened the intensive corporate management and optimized the operating model of premium standardized housing . a number of key indicators continued to record substantial growth . during fiscal 2011 , the company achieved a total sales revenue amount of $ 56.9 million , an increase of 20 % over fiscal 2010 's total sales revenue of $ 47.3 million . our average selling price in fiscal 2011 was approximately $ 436 per square meter , increased by 22 % over fiscal 2010. our sales in fiscal 2011 were mainly generated from four projects , namely yanzhou pear garden , nandajie , mingzhu garden and central plaza . this achievement resulted from an effective strategy in reaction to the changes in the chinese real estate market and governmental policies , strengthened management of construction progress , strict cost controls , and an enhanced marketing force to increase the public recognition of our brand . t here also exist some uncertainties in our future sales trend which may impact our reported revenue in the near future . we recognize real estate sales revenue when all the criteria for revenue recognition have been met and the property has been delivered to buyers . our sales revenue is affected by the number of units delivered and also affected by fluctuations in market prices . most of our newly developed projects are high-rise buildings with longer construction periods . consequently , in certain future reporting periods , we may not have any new construction work completed and delivered to buyers . this may negatively impact our revenue in such periods . this is a characteristic of our business and uneven sales revenues from quarter to quarter is due in part to the rate at which units are completed and delivered to buyers . with respect to capital funding requirements , while many property developers must now worry about their debt leverage and working capital needs for debt repayment , in contrast , the company does not have any external debt obligations outstanding as at september 30 , 2011 except for a loan in the amount of $ 1,810,000 to its major shareholder . the company 's ample cash flows from sales and , if necessary , shareholder loans should provide financial support for its current development and operations . in order to fully implement our business plan , however , we may need to raise capital in future . our expectation , therefore , is that we will seek to access the capital markets in both the u.s. and china to obtain the funds we require . at the present time , however , we do not have commitments of funds from any source . 27 the government 's tightening policies should continue in 2012 , which may make real estate developers face more difficulties in obtaining land use rights and bank loans . these governmental policies will also negatively affect buyers ' confidence and consumption psychology . some buyers are taking a wait-and-see attitude and may delay their purchasing decision . such market conditions will impact our sales revenue to a certain degree . despite the declining transaction volume and cooling real estate market , housing prices in tier 3 and tier 4 cities and counties have not shown a substantial correction . meanwhile , with affordable housing construction still underway , it takes time for abundant affordable housing to appear in the market . the company therefore expects the purchase restrictions and price ceiling policies to continue , which however , should have less impact on the company 's products compared to the real estate markets in tier i and ii cities and counties . on the other hand , credit conditions will likely continue to tighten . the company expects to continue to focus on developing real estate properties in prime locations of tier 3 and tier 4 cities and counties . results of operation revenues we recognize revenue from the sales of real property in accordance with the full accrual method at the time of the closing of an individual unit sale . this occurs when title to or possession of the property is transferred to the buyer . a sale is not considered consummated until ( a ) the parties are bound by the terms of a contract , ( b ) all consideration has been exchanged , ( c ) any permanent financing of which the seller is responsible has been arranged , ( d ) all conditions precedent to closing have been performed , ( e ) the seller does not have substantial continuing involvement with the property , and ( f ) the usual risks and rewards of ownership have been transferred to the buyer . further , the buyer 's initial and continuing investment is adequate to demonstrate a commitment to pay for the property , and the buyer 's receivable , if any , is not subject to future subordination . story_separator_special_tag the average translation rates applied to the income statements accounts for the periods ended september 30 , 2011 and 2010 were 6.5377 rmb and 6.82135 rmb , respectively . story_separator_special_tag text-indent : 0pt ; margin-right : 0pt `` > 34 operating activities net cash used in operating activities during the twelve months ended september 30 , 2011 was $ 5,586,447 , consisting of net income of $ 18,719,938 , noncash adjustments of $ 137,059 and net changes in our operating assets and liabilities due to our expanded operating activities , including a decrease in restricted cash of $ 79,523 , an increase in advances to vendors and loans to outside parties of $ 1,403,056 which were made in order to maintain good relationships with the suppliers , an increase in real estate property completed of $ 7,284,509 , an increase in real estate property under development of $ 24,128,313 due to our expansion into multiple phases of the existing real estate projects during the year , increased security deposits for land use rights of $ 6,118,360 , increased accounts payable of $ 6,448,357 due to more progress achieved in multiple real estate projects , increased customer deposits in the amount of $ 7,372,965 which we were able to recognize as revenue when all conditions for revenue recognition were met , increased accrued expenses of $ 1,023,617 due to unpaid sales commissions and staff compensation , and decreased taxes payable of $ 71,217 due to an increase in our net income . the negative cash provided by operating activities is mainly attributable to our significant spending on real estate property under development and deposits for land use rights . net cash used in operating activities during the twelve months ended september 30 , 2010 was $ 12,253,101 , consisting of net income of $ 17,312,762 , noncash adjustments of $ 114,456 offset by net changes in our operating assets and liabilities due to our expanded operating activities , including an increase in restricted cash of $ 493,208 , an increase in loans to outside parties of $ 4,807,282 which were made in order to maintain good relationships with the suppliers , an increase in real estate property completed of $ 8,327,290 , a decrease in real estate property under development of $ 6,011,679 due to the completion of three projects during the year , decreased customer deposits in the amount of $ 888,119 which we were able to recognize as revenue because all conditions for revenue recognition were met , increased taxes payable of $ 2,456,598 due to an increase in our net income , and increased accrued expenses of $ 772,007. the increase of the cash provided by operating activities is mainly attributable to the decrease in real estate property under development and the increase in taxes payable . the decrease in real estate property is due to the increased completion of buildings of yangzhou pearl garden , mingzhu garden ( mingzhu nanyuan and mingzhu beiyuan ) , oriental mingzhu garden and nandajie ( mingzhu xinju ) . the increase in taxes payable resulted from the increase in revenue . net cash used in operating activities for the year ended september 30 , 2011 was $ 5,586,447 compared with a net cash provided by operating activities of $ 12,253,102 for the year ended september 30 , 2010 , a net decrease of $ 17,839,549 compared to the same period in 2010. investing activities cash flows used in investing activities were $ 490,755 in the twelve months ended september 30 , 2011 , compared to $ 7,696 in the twelve months ended september 30 , 2010. cash flows used in investing activities in the twelve months ended september 30 , 2011 increased by $ 483,755 compared to the same period in 2010 as a result of the purchase of a new office building in 2011. financing activities net cash flows provided by financing activities amounted to $ 1,810,000 in the twelve months ended september 30 , 2011 , which was a loan from our major shareholder . cash flows used in financing activities amounted to $ 674,353 in the twelve months ended september 30 , 2010 , which consisted of the repayment of loans . cash flows provided by financing activities for the year ended september 30 , 2011 increased by $ 2,484,353 to $ 1,810,000 , compared to $ 674,353 of cash flow used in financing activities in 2010. off-balance sheet arrangements we do not have any off-balance sheet arrangements . inflation inflation has not had a material impact on our business and we do not expect inflation to have a material impact on our business in the near future . 35 critical accounting policies and management estimates the discussion and analysis of our financial condition and results of operations are based upon our consolidated financial statements , which have been prepared in accordance with accounting principles generally accepted in the united states . the preparation of these consolidated financial statements requires us to make estimates and judgments that affect our reported assets , liabilities , revenues and expenses , and related disclosure of contingent assets and liabilities . we evaluate our estimates on an on-going basis and use them on historical experience and various other assumptions that are believed to be reasonable under the circumstances as the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources . actual results may differ from these estimates because of different assumptions or conditions . we believe the following critical accounting policies affect our significant estimates and judgments used in the preparation of our consolidated financial statements . these policies should be read in conjunction with note 2 of the notes to consolidated financial statements . principles of consolidation the company 's consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the united states of america ( “ u.s . gaap ” ) . the consolidated financial

movements in the underlying plan asset value and projected benefit obligation ( “pbo” ) are dependent on actual return on investments as well as our assumptions in respect of the discount rate , annual member mortality rates , future return on assets and future inflation . a change in any one of these assumptions could impact the plan asset value , pbo and pension charge recognized in the income statement . such changes could adversely impact our results of operations and financial position . for example , a 0.25 % change in the discount rate assumption would change the pbo by approximately $ 29 million and the net pension credit for 2015 by approximately $ 0.3 million . a 0.25 % change in the level of price inflation assumption would change the pbo by approximately $ 22 million and the net pension credit for 2015 would not be significantly changed . further information is provided in note 9 of the notes to the consolidated financial statements . deferred tax and uncertain income tax positions at december 31 , 2014 , no valuation allowance is required against our foreign tax credit carry forwards within deferred tax as management believes that all the foreign tax credit carry forwards can be utilized in future periods prior to their expiration . 25 no deferred taxes have been provided for on the unremitted earnings of our overseas subsidiaries as any tax basis differences relating to investments in these overseas subsidiaries are considered to be permanent in duration . we have no current intention to repatriate past or future earnings of our overseas subsidiaries and consider that these earnings have been reinvested overseas . if circumstances were to change that would cause these earnings to be repatriated an additional u.s. tax liability could be incurred , and we continue to monitor this position . the calculation of our tax liabilities involves evaluating uncertainties in the application of complex tax regulations . we recognize liabilities for anticipated tax audit issues based on our estimate of whether , and the extent to which , additional taxes will be required . if we ultimately determine that payment of these amounts is unnecessary , we reverse the liability and recognize a tax benefit during the period in which we determine that the liability is no longer necessary . we also recognize tax benefits to the extent that it is more likely than not that our positions will be sustained , based on technical merits , when challenged by the taxing authorities . to the extent that we prevail in matters for which liabilities have been established , or are required to pay amounts in excess of our liabilities , our effective tax rate in a given period may be materially affected . an unfavorable tax settlement may require cash payments and result in an increase in our effective tax rate in the year of resolution . a favorable tax settlement may be recognized as a reduction in our effective tax rate in the year of resolution . we report interest and penalties related to uncertain income tax positions as income taxes . for additional information regarding uncertain income tax positions see note 10 of the notes to the consolidated financial statements . business combinations the acquisition method of accounting requires that we recognize the assets acquired and liabilities assumed at their acquisition date fair values . goodwill is measured as the excess of consideration transferred over the acquisition date net fair values of the assets acquired and the liabilities assumed . the measurement of the fair values of assets acquired and liabilities assumed requires considerable judgment . although independent appraisals may be used to assist in the determination of the fair values of certain assets and liabilities , those determinations are usually based on significant estimates provided by management , such as forecast revenue or profit . in determining the fair value of intangible assets , an income approach is generally used and may incorporate the use of a discounted cash flow method . in applying the discounted cash flow method , the estimated future cash flows and residual values for each intangible asset are discounted to a present value using a discount rate appropriate to the business being acquired . these cash flow projections are based on management 's estimates of economic and market conditions including revenue growth rates , operating margins , capital expenditures and working capital requirements . 26 while we use our best estimates and assumptions as part of the process to value assets acquired and liabilities assumed at the acquisition date , our estimates are inherently uncertain and subject to refinement . during the measurement period , which occurs before finalization of the purchase price allocation , changes in assumptions and estimates that result in adjustments to the fair values of assets acquired and liabilities assumed will have a corresponding offset to goodwill . subsequent adjustments will impact our consolidated statements of income . goodwill the company 's reporting units , the level at which goodwill is tested for impairment , are consistent with the reportable segments . the components in each segment ( including products , markets and competitors ) have similar economic characteristics and the segments , therefore , reflect the lowest level at which operations and cash flows can be sufficiently distinguished , operationally and for financial reporting purposes , from the rest of the company . the company tests goodwill annually for impairment , or between years if events occur or circumstances change which suggest that an impairment may have occurred . the company performs its annual goodwill tests in respect of fuel specialties and performance chemicals as at december 31 each year . in reviewing for any impairment charge the fair values of the reporting segments are estimated using an after-tax cash flow methodology based on management 's best available estimates at that time . story_separator_special_tag octane additives net sales : decreased by 15 % with decreased volumes ( down 18 percentage points ) , due to the timing of shipments and declining demand from major customers , and an improved customer mix ( up 4 percentage points ) , together with reduced revenue from our environmental remediation business ( down 1 percentage points ) . in both 2013 and 2012 , sales were focused in the middle east and northern africa . gross margin : decreased by 1.6 percentage points from 48.7 % to 47.1 % , due to lower manufacturing volumes , partly offset by favorable customer mix and non-recurring freight storage costs in the prior year . operating expenses : decreased by $ 1.6 million from $ 7.9 million to $ 6.3 million , due to the efficient management of the cost base . other income statement captions pension credit/ ( charge ) : this non-cash charge increased to a $ 2.3 million net charge in 2013 compared to a $ 1.6 million net charge in 2012 , after revising the amortization of actuarial losses in 2012. the increase in the net charge in 2013 primarily relates to increased actuarial net losses being amortized to the income statement . corporate costs : the year on year increase of 13 % , or $ 5.0 million , reflected $ 8.3 million higher legal , compliance , professional and other expenses , including acquisition-related costs of $ 1.8 million in 2013 compared to $ 2.8 million in 2012 ; $ 1.8 million higher personnel-related compensation costs , primarily due to higher accruals for share based compensation expense , driven by the rise in our stock price compared to the same period in the prior year ; $ 0.7 million higher information technology service platform costs ; offset by a $ 5.8 million reduction in the charge for the long-term incentive plan which completed at the end of 2012. impairment of octane additives segment goodwill : was $ 1.3 million in 2013 and $ 1.2 million in 2012. other net income/ ( expense ) : other net income of $ 4.1 million primarily related to gains of $ 5.8 million on translation of net assets denominated in non-functional currencies in our european businesses , partly offset by net foreign exchange losses on foreign currency forward exchange contracts of $ 1.6 million . in 2012 , other net expense of $ 2.0 million primarily related to losses on translation of net assets denominated in non-functional currencies in our european businesses offset by net foreign exchange gains on foreign currency forward exchange contracts . 36 interest expense , net : increased to $ 1.9 million in 2013 from $ 1.2 million in 2012 due to the higher level of borrowing during 2013 , used primarily to fund our acquisition activity . income taxes : the effective tax rate was 16.2 % and 28.3 % in 2013 and 2012 , respectively . the effective tax rate , once adjusted for income tax provisions and for the tax impact of acquisition-related funding , was 15.9 % in 2013 compared with 20.2 % in 2012. the company believes that this adjusted effective tax rate , a non-gaap financial measure , provides useful information to investors and may assist them in evaluating the company 's underlying performance and identifying operating trends . in addition , management uses this non-gaap financial measure internally to evaluate the performance of the company 's operations and for planning and forecasting in subsequent periods . replace_table_token_17_th in addition to those mentioned above , the following factors had a significant impact on the company 's effective tax rate as compared to the u.s. federal income tax rate of 35 % : replace_table_token_18_th the impact on the effective tax rate from profits earned in foreign jurisdictions with lower tax rates varies as the geographical mix of the company 's profits changes year on year . in 2013 , the company 's income tax expense benefited to a lesser degree from a proportion of its overall profits arising in switzerland than in 2012. this resulted in a $ 9.3 million benefit in switzerland ( 2012 – $ 12.0 million ) . in addition , there was a $ 3.9 million benefit in relation to the united kingdom ( 2012 – $ 3.3 million ) and a $ 0.3 million benefit in relation to germany ( 2012 – $ 0.7 million ) . foreign income inclusions arise each year from certain types of income earned overseas being taxable under u.s. tax regulations . these types of income include subpart f income , principally from foreign based company sales in the united kingdom , including the associated section 78 tax gross up , and also from the income earned by certain overseas subsidiaries 37 taxable under the u.s. tax regime . in 2013 , the amount of subpart f income and the associated section 78 gross up amounted to $ 4.3 million ( 2012 – $ 4.3 million ) . the income earned by certain overseas subsidiaries taxable under the u.s. tax regime decreased to $ 1.2 million from $ 2.5 million in 2012. a dividend from an overseas subsidiary , remitted to the u.s. , increased foreign income inclusions by $ 39.0 million during 2012. in 2013 no dividends were remitted to the u.s .. foreign tax credits can fully or partially offset these incremental u.s. taxes from foreign income inclusions . the utilization of foreign tax credits varies year on year as this is dependent on a number of variable factors which are difficult to predict and may in certain years prevent any offset of foreign tax credits . in total , $ 4.2 million of foreign tax credits were utilized during 2013 to partially offset the incremental u.s. taxes arising from foreign income inclusions in the year ( 2012 – an overseas dividend was remitted to the u.s. to provide funding for the company 's acquisition program and $

liquidity and financial condition working capital the company believes that adjusted working capital , a non-gaap financial measure , provides useful information to investors in evaluating the company 's underlying performance and identifying operating trends . management uses this non-gaap financial measure internally to allocate resources and evaluate the performance of the company 's operations . items excluded from the adjusted working capital calculation are listed in the table below and represent factors which do not fluctuate in line with the day to day working capital needs of the business . replace_table_token_19_th in 2014 our adjusted working capital increased by $ 29.0 million , primarily due to $ 28.9 million of working capital in the independence business as at december 31 , 2014. we had a $ 28.5 million increase in trade and other accounts receivable in 2014 , which is primarily related to the acquisition of independence , partly offset by lower receivables in our octane additives segment due to the declining demand and the timing of shipments to our one remaining customer . days ' sales outstanding in our fuel specialties segment increased from 49 days to 52 days and decreased from 51 days to 48 days in our performance chemicals segment . we had a $ 26.0 million increase in inventories in 2014 , which is primarily related to the acquisition of independence , together with slightly higher inventories in our fuel specialties segment . days ' sales in inventory in our fuel specialties segment decreased from 79 days to 76 days and increased in our performance chemicals segment from 96 days to 99 days . 39 prepaid expenses increased $ 2.5 million from $ 5.8 million to $ 8.3 million , partly related to the acquisition of independence . we had a $ 28.0 million increase in accounts payable and accrued liabilities during 2014 , which is primarily related to the acquisition of independence .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```liquidity and financial condition working capital the company believes that adjusted working capital , a non-gaap financial measure , provides useful information to investors in evaluating the company 's underlying performance and identifying operating trends . management uses this non-gaap financial measure internally to allocate resources and evaluate the performance of the company 's operations . items excluded from the adjusted working capital calculation are listed in the table below and represent factors which do not fluctuate in line with the day to day working capital needs of the business . replace_table_token_19_th in 2014 our adjusted working capital increased by $ 29.0 million , primarily due to $ 28.9 million of working capital in the independence business as at december 31 , 2014. we had a $ 28.5 million increase in trade and other accounts receivable in 2014 , which is primarily related to the acquisition of independence , partly offset by lower receivables in our octane additives segment due to the declining demand and the timing of shipments to our one remaining customer . days ' sales outstanding in our fuel specialties segment increased from 49 days to 52 days and decreased from 51 days to 48 days in our performance chemicals segment . we had a $ 26.0 million increase in inventories in 2014 , which is primarily related to the acquisition of independence , together with slightly higher inventories in our fuel specialties segment . days ' sales in inventory in our fuel specialties segment decreased from 79 days to 76 days and increased in our performance chemicals segment from 96 days to 99 days . 39 prepaid expenses increased $ 2.5 million from $ 5.8 million to $ 8.3 million , partly related to the acquisition of independence . we had a $ 28.0 million increase in accounts payable and accrued liabilities during 2014 , which is primarily related to the acquisition of independence . ``` Suspicious Activity Report : movements in the underlying plan asset value and projected benefit obligation ( “pbo” ) are dependent on actual return on investments as well as our assumptions in respect of the discount rate , annual member mortality rates , future return on assets and future inflation . a change in any one of these assumptions could impact the plan asset value , pbo and pension charge recognized in the income statement . such changes could adversely impact our results of operations and financial position . for example , a 0.25 % change in the discount rate assumption would change the pbo by approximately $ 29 million and the net pension credit for 2015 by approximately $ 0.3 million . a 0.25 % change in the level of price inflation assumption would change the pbo by approximately $ 22 million and the net pension credit for 2015 would not be significantly changed . further information is provided in note 9 of the notes to the consolidated financial statements . deferred tax and uncertain income tax positions at december 31 , 2014 , no valuation allowance is required against our foreign tax credit carry forwards within deferred tax as management believes that all the foreign tax credit carry forwards can be utilized in future periods prior to their expiration . 25 no deferred taxes have been provided for on the unremitted earnings of our overseas subsidiaries as any tax basis differences relating to investments in these overseas subsidiaries are considered to be permanent in duration . we have no current intention to repatriate past or future earnings of our overseas subsidiaries and consider that these earnings have been reinvested overseas . if circumstances were to change that would cause these earnings to be repatriated an additional u.s. tax liability could be incurred , and we continue to monitor this position . the calculation of our tax liabilities involves evaluating uncertainties in the application of complex tax regulations . we recognize liabilities for anticipated tax audit issues based on our estimate of whether , and the extent to which , additional taxes will be required . if we ultimately determine that payment of these amounts is unnecessary , we reverse the liability and recognize a tax benefit during the period in which we determine that the liability is no longer necessary . we also recognize tax benefits to the extent that it is more likely than not that our positions will be sustained , based on technical merits , when challenged by the taxing authorities . to the extent that we prevail in matters for which liabilities have been established , or are required to pay amounts in excess of our liabilities , our effective tax rate in a given period may be materially affected . an unfavorable tax settlement may require cash payments and result in an increase in our effective tax rate in the year of resolution . a favorable tax settlement may be recognized as a reduction in our effective tax rate in the year of resolution . we report interest and penalties related to uncertain income tax positions as income taxes . for additional information regarding uncertain income tax positions see note 10 of the notes to the consolidated financial statements . business combinations the acquisition method of accounting requires that we recognize the assets acquired and liabilities assumed at their acquisition date fair values . goodwill is measured as the excess of consideration transferred over the acquisition date net fair values of the assets acquired and the liabilities assumed . the measurement of the fair values of assets acquired and liabilities assumed requires considerable judgment . although independent appraisals may be used to assist in the determination of the fair values of certain assets and liabilities , those determinations are usually based on significant estimates provided by management , such as forecast revenue or profit . in determining the fair value of intangible assets , an income approach is generally used and may incorporate the use of a discounted cash flow method . in applying the discounted cash flow method , the estimated future cash flows and residual values for each intangible asset are discounted to a present value using a discount rate appropriate to the business being acquired . these cash flow projections are based on management 's estimates of economic and market conditions including revenue growth rates , operating margins , capital expenditures and working capital requirements . 26 while we use our best estimates and assumptions as part of the process to value assets acquired and liabilities assumed at the acquisition date , our estimates are inherently uncertain and subject to refinement . during the measurement period , which occurs before finalization of the purchase price allocation , changes in assumptions and estimates that result in adjustments to the fair values of assets acquired and liabilities assumed will have a corresponding offset to goodwill . subsequent adjustments will impact our consolidated statements of income . goodwill the company 's reporting units , the level at which goodwill is tested for impairment , are consistent with the reportable segments . the components in each segment ( including products , markets and competitors ) have similar economic characteristics and the segments , therefore , reflect the lowest level at which operations and cash flows can be sufficiently distinguished , operationally and for financial reporting purposes , from the rest of the company . the company tests goodwill annually for impairment , or between years if events occur or circumstances change which suggest that an impairment may have occurred . the company performs its annual goodwill tests in respect of fuel specialties and performance chemicals as at december 31 each year . in reviewing for any impairment charge the fair values of the reporting segments are estimated using an after-tax cash flow methodology based on management 's best available estimates at that time . story_separator_special_tag octane additives net sales : decreased by 15 % with decreased volumes ( down 18 percentage points ) , due to the timing of shipments and declining demand from major customers , and an improved customer mix ( up 4 percentage points ) , together with reduced revenue from our environmental remediation business ( down 1 percentage points ) . in both 2013 and 2012 , sales were focused in the middle east and northern africa . gross margin : decreased by 1.6 percentage points from 48.7 % to 47.1 % , due to lower manufacturing volumes , partly offset by favorable customer mix and non-recurring freight storage costs in the prior year . operating expenses : decreased by $ 1.6 million from $ 7.9 million to $ 6.3 million , due to the efficient management of the cost base . other income statement captions pension credit/ ( charge ) : this non-cash charge increased to a $ 2.3 million net charge in 2013 compared to a $ 1.6 million net charge in 2012 , after revising the amortization of actuarial losses in 2012. the increase in the net charge in 2013 primarily relates to increased actuarial net losses being amortized to the income statement . corporate costs : the year on year increase of 13 % , or $ 5.0 million , reflected $ 8.3 million higher legal , compliance , professional and other expenses , including acquisition-related costs of $ 1.8 million in 2013 compared to $ 2.8 million in 2012 ; $ 1.8 million higher personnel-related compensation costs , primarily due to higher accruals for share based compensation expense , driven by the rise in our stock price compared to the same period in the prior year ; $ 0.7 million higher information technology service platform costs ; offset by a $ 5.8 million reduction in the charge for the long-term incentive plan which completed at the end of 2012. impairment of octane additives segment goodwill : was $ 1.3 million in 2013 and $ 1.2 million in 2012. other net income/ ( expense ) : other net income of $ 4.1 million primarily related to gains of $ 5.8 million on translation of net assets denominated in non-functional currencies in our european businesses , partly offset by net foreign exchange losses on foreign currency forward exchange contracts of $ 1.6 million . in 2012 , other net expense of $ 2.0 million primarily related to losses on translation of net assets denominated in non-functional currencies in our european businesses offset by net foreign exchange gains on foreign currency forward exchange contracts . 36 interest expense , net : increased to $ 1.9 million in 2013 from $ 1.2 million in 2012 due to the higher level of borrowing during 2013 , used primarily to fund our acquisition activity . income taxes : the effective tax rate was 16.2 % and 28.3 % in 2013 and 2012 , respectively . the effective tax rate , once adjusted for income tax provisions and for the tax impact of acquisition-related funding , was 15.9 % in 2013 compared with 20.2 % in 2012. the company believes that this adjusted effective tax rate , a non-gaap financial measure , provides useful information to investors and may assist them in evaluating the company 's underlying performance and identifying operating trends . in addition , management uses this non-gaap financial measure internally to evaluate the performance of the company 's operations and for planning and forecasting in subsequent periods . replace_table_token_17_th in addition to those mentioned above , the following factors had a significant impact on the company 's effective tax rate as compared to the u.s. federal income tax rate of 35 % : replace_table_token_18_th the impact on the effective tax rate from profits earned in foreign jurisdictions with lower tax rates varies as the geographical mix of the company 's profits changes year on year . in 2013 , the company 's income tax expense benefited to a lesser degree from a proportion of its overall profits arising in switzerland than in 2012. this resulted in a $ 9.3 million benefit in switzerland ( 2012 – $ 12.0 million ) . in addition , there was a $ 3.9 million benefit in relation to the united kingdom ( 2012 – $ 3.3 million ) and a $ 0.3 million benefit in relation to germany ( 2012 – $ 0.7 million ) . foreign income inclusions arise each year from certain types of income earned overseas being taxable under u.s. tax regulations . these types of income include subpart f income , principally from foreign based company sales in the united kingdom , including the associated section 78 tax gross up , and also from the income earned by certain overseas subsidiaries 37 taxable under the u.s. tax regime . in 2013 , the amount of subpart f income and the associated section 78 gross up amounted to $ 4.3 million ( 2012 – $ 4.3 million ) . the income earned by certain overseas subsidiaries taxable under the u.s. tax regime decreased to $ 1.2 million from $ 2.5 million in 2012. a dividend from an overseas subsidiary , remitted to the u.s. , increased foreign income inclusions by $ 39.0 million during 2012. in 2013 no dividends were remitted to the u.s .. foreign tax credits can fully or partially offset these incremental u.s. taxes from foreign income inclusions . the utilization of foreign tax credits varies year on year as this is dependent on a number of variable factors which are difficult to predict and may in certain years prevent any offset of foreign tax credits . in total , $ 4.2 million of foreign tax credits were utilized during 2013 to partially offset the incremental u.s. taxes arising from foreign income inclusions in the year ( 2012 – an overseas dividend was remitted to the u.s. to provide funding for the company 's acquisition program and $

in particular , we expect our expenses to increase as we continue our development of , and seek regulatory approvals for , our product candidates , and begin to commercialize any approved products , as well as hire additional personnel , develop commercial infrastructure , pay fees to outside consultants , lawyers and accountants , and incur increased costs associated with being a public company , such as expenses related to services associated with maintaining compliance with nasdaq listing rules and sec reporting requirements , insurance and investor relations . our net losses may fluctuate significantly from quarter-to-quarter and year-to-year , depending upon the timing of our clinical trials and our expenditures on other research and development activities . cash used to fund operating expenses is impacted by the timing of when we pay these expenses , as reflected in the change in our accounts payable and accrued research and development and other current liabilities . recent developments initial public offering on september 29 , 2020 , we completed our ipo . as a result of the ipo , we issued and sold an aggregate of 6,468,750 shares of our common stock ( inclusive of 843,750 shares issued and sold pursuant to the exercise of the underwriters ' option to purchase additional shares on october 22 , 2020 ) at a price of $ 16.00 per share for net proceeds of $ 92.0 million , after deducting underwriting discounts , commissions and offering expenses . prior to the completion of the ipo , all 117,809,883 shares of our redeemable convertible preferred stock then outstanding were converted into 13,085,913 shares of common stock . business effects of covid-19 the current covid-19 pandemic has presented a substantial public health and economic challenge around the world and is affecting our employees , patients , clinicians , communities and business operations , as well as the u.s. economy and financial markets . to date , our financial condition and operations have not been significantly impacted by the covid-19 outbreak ; however , the full extent to which the covid-19 pandemic will directly or indirectly impact our business , results of operations , liquidity and financial 77 condition will depend on future developments , which are highly uncertain and can not be accurately predicted , including new information that may emerge concerning covid-19 , the actions taken to contain it or treat its impact and the economic impact on local , regional , national and international markets . to date , our contract research organizations , or cros , contract manufacturing organizations , or cmos , and other vendors have been able to continue to provide services and supply reagents , materials , and products and currently do not anticipate any disruption in services or interruptions in supply . our cmos continue to operate their manufacturing facilities at or near normal levels . while we currently do not anticipate any interruptions in our manufacturing process , it is possible that the covid-19 pandemic and response efforts may have an impact in the future on our third-party suppliers ' and contract manufacturing partners ' ability to manufacture reagents , materials or products that we need to use in our research and upcoming clinical trials . however , we are continuing to assess the potential impact of the covid-19 pandemic on our business and operations , including our expenses , our clinical trials , and our ability to hire and retain employees . while we are currently continuing to monitor patients in our altissimo clinical trial at sites across the united states , we expect that covid-19 precautions may directly or indirectly impact the timeline for some of our clinical trial activities due to the inability of patients to come to their monitoring visits , the closing of eye clinics , and or diversion of resources that are necessary to conduct our observational study to care for covid-19 patients . the covid-19 pandemic has caused us to modify our business practices including , but not limited to , curtailing or modifying employee travel , moving to partial remote work , and cancelling physical participation in meetings , events and conferences . we may take further actions as may be required by government authorities or that we determine are in the best interests of our employees , patients , clinicians , and business partners . the majority of our office-based employees have been working from home since march 2020 , while ensuring essential staffing levels to support our operations remain in place , including maintaining key personnel in our laboratories . for additional information on the various risks posed by the covid-19 pandemic , please read item 1a . risk factors . components of operating results research and development expenses our research and development expenses include : personnel costs , which include salaries , benefits and stock-based compensation ; expenses incurred under agreements with consultants and third-party contract organizations that conduct research and development activities on our behalf ; costs related to sponsored research service agreements ; costs related to production of preclinical and clinical materials , including fees paid to contract manufacturers ; laboratory and vendor expenses related to the execution of preclinical studies and planned clinical trials ; milestones and royalty expense from our johns hopkins university exclusive license agreement ; laboratory supplies and materials used for internal research and development activities ; and facilities and equipment costs . most of our research and development expenses have been related to the preclinical and clinical development of gb-102 . we have not reported program costs since inception because we have not historically tracked or recorded our research and development expenses on a program-by-program basis . we use our personnel and infrastructure resources across the breadth of our research and development activities , which are directed toward identifying and developing product candidates . we expense all research and development costs in the periods in which they are incurred . story_separator_special_tag preferred stock tranche obligation convertible preferred stock that includes features we have determined are not clearly and closely related to the equity host are bifurcated and accounted for separately as freestanding derivative assets or liabilities on the balance sheet at their estimated fair value . we recognized a derivative liability as a result of certain investors ' having rights to purchase from us , on the same terms as the series c preferred stock purchase agreement executed in july 2019 , additional shares of our series c preferred stock in subsequent tranches based on the achievement of certain development milestones , or the preferred stock tranche obligation . at initial recognition , we recorded the liability for the preferred stock tranche obligation on the balance sheet at its estimated fair value . this liability was subject to remeasurement at each balance sheet date until the expiration of the preferred stock tranche obligation in september 2020 , with changes in fair value recognized in our statements of operations . the liability for the preferred stock tranche obligation was measured at fair value using an option pricing valuation methodology that included inputs not observable in the market and thus represents a level 3 measurement . the option pricing valuation methodology utilized requires inputs based on certain subjective assumptions , including ( a ) expected stock price volatility , ( b ) calculation of an expected term , ( c ) a risk-free interest rate and ( d ) expected dividends . significant judgment was used in determining these assumptions at initial recognition and at each subsequent reporting period . stock-based compensation we recognize compensation costs related to stock-based awards to employees and non-employees based on the estimated fair value of the awards on the date of grant . we estimate the grant date fair value , and the resulting stock-based compensation , using the black-scholes option-pricing model , or black-scholes . the grant date fair value of the stock-based awards is generally recognized on a straight-line basis over the requisite service period , which is generally the vesting period of the respective awards . black-scholes requires the use of subjective assumptions to determine the fair value of stock-based awards including : fair value of common stock— see subsection entitled “ common stock valuations ” below . expected term—the expected term represents the period that stock-based awards are expected to be outstanding . the expected term for option grants is determined using the simplified method . the simplified method deems the expected term to be the midpoint between the vesting date and the contractual life of the stock-based awards . expected volatility— since we were a privately held company until september 2020 , and do not yet have sufficient trading history for our common stock , the expected volatility is estimated based on the average volatility for comparable publicly traded biotechnology companies over a period equal to the expected term of the stock option grants . the comparable companies were chosen based on their similar size , stage in the life cycle or area of specialty . we will continue to apply this method until a sufficient amount of historical information over a period equal to the expected term of the stock-based awards becomes available . 84 risk-free interest rate—the risk-free interest rate is based on the u.s. treasury zero coupon issues in effect at the time of grant for periods corresponding with the expected term of the option . expected dividend—we have never paid dividends on our common stock and have no plans to pay dividends on our common stock . therefore , we used an expected dividend yield of zero . we will continue to use judgment in evaluating the assumptions utilized for our stock-based compensation expense calculations on a prospective basis . in addition to the assumptions used in black-scholes , the amount of stock-based compensation expense we recognize in our financial statements includes stock option forfeitures as they occur . such assumptions involve inherent uncertainties and the application of significant judgment . as a result , if factors or expected outcomes change and we use significantly different assumptions or estimates , our stock-based compensation could be materially different . common stock valuations historically , for all periods prior to our ipo , the fair value of the shares of common stock underlying our stock-based awards was estimated on each grant date by our board of directors . in the absence of a public trading market for our common stock , our board of directors exercised their judgment and considered a number of objective and subjective factors to determine the best estimate of the fair value of our common stock , including contemporaneous valuations , our stage of development , important developments in our operations , the prices at which we sold shares of our preferred stock , the rights , preferences and privileges of our preferred stock relative to those of our common stock , actual operating results and financial performance , the conditions in the biotechnology industry and the economy in general , the stock price performance and volatility of comparable public companies , and the lack of liquidity of our common stock , among other factors . in determining the fair value of our common stock , the methodologies used to estimate our enterprise value were performed using methodologies , approaches and assumptions consistent with the guidance outlined in the american institute of certified public accountants technical practice aid , valuation of privately held company equity securities issued as compensation . the grant date fair value of our common stock was determined using valuation methodologies incorporating a number of assumptions including probability weighting of events , volatility , time to liquidation , a risk-free interest rate and an assumption for a discount for lack of marketability ( level 3 inputs ) . the methodology to determine the fair value of our common stock included estimating the fair value of the enterprise using a hybrid-method market approach ,

cash flows the following table summarizes our cash flows for the periods indicated : replace_table_token_4_th 82 operating activities cash used in operating activities of $ 32.1 million during the year ended december 31 , 2020 was primarily attributable to our net loss of $ 27.5 million and an increase of $ 4.6 million in our working capital . cash used in operating activities of $ 31.2 million during the year ended december 31 , 2019 was attributable to our net loss of $ 37.0 million , partially offset by a $ 4.9 million decrease in our working capital and non-cash charges of $ 0.9 million principally with respect to stock-based compensation and depreciation expense . investing activities cash used in investing activities of $ 42.6 million during the year ended december 31 , 2020 consisted of $ 61.6 million of purchases of short-term investments and $ 1.0 million of purchases of property and equipment , partially offset by $ 20.0 million provided upon maturity of short-term investments . cash used in investing activities of $ 20.6 million during the year ended december 31 , 2019 consisted of $ 22.5 million of purchases of short-term investments and $ 0.6 million of purchases of property and equipment , partially offset by $ 2.5 million provided upon maturity of short-term investments . financing activities cash provided by financing activities of $ 92.2 million for the year ended december 31 , 2020 consisted of $ 96.3 million of proceeds , net of the underwriters ' discounts and commissions , from the issuance of common stock in connection with our ipo and $ 0.1 million received from the exercise of stock options , partially offset by $ 4.2 million related to the payments of offering costs .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```cash flows the following table summarizes our cash flows for the periods indicated : replace_table_token_4_th 82 operating activities cash used in operating activities of $ 32.1 million during the year ended december 31 , 2020 was primarily attributable to our net loss of $ 27.5 million and an increase of $ 4.6 million in our working capital . cash used in operating activities of $ 31.2 million during the year ended december 31 , 2019 was attributable to our net loss of $ 37.0 million , partially offset by a $ 4.9 million decrease in our working capital and non-cash charges of $ 0.9 million principally with respect to stock-based compensation and depreciation expense . investing activities cash used in investing activities of $ 42.6 million during the year ended december 31 , 2020 consisted of $ 61.6 million of purchases of short-term investments and $ 1.0 million of purchases of property and equipment , partially offset by $ 20.0 million provided upon maturity of short-term investments . cash used in investing activities of $ 20.6 million during the year ended december 31 , 2019 consisted of $ 22.5 million of purchases of short-term investments and $ 0.6 million of purchases of property and equipment , partially offset by $ 2.5 million provided upon maturity of short-term investments . financing activities cash provided by financing activities of $ 92.2 million for the year ended december 31 , 2020 consisted of $ 96.3 million of proceeds , net of the underwriters ' discounts and commissions , from the issuance of common stock in connection with our ipo and $ 0.1 million received from the exercise of stock options , partially offset by $ 4.2 million related to the payments of offering costs . ``` Suspicious Activity Report : in particular , we expect our expenses to increase as we continue our development of , and seek regulatory approvals for , our product candidates , and begin to commercialize any approved products , as well as hire additional personnel , develop commercial infrastructure , pay fees to outside consultants , lawyers and accountants , and incur increased costs associated with being a public company , such as expenses related to services associated with maintaining compliance with nasdaq listing rules and sec reporting requirements , insurance and investor relations . our net losses may fluctuate significantly from quarter-to-quarter and year-to-year , depending upon the timing of our clinical trials and our expenditures on other research and development activities . cash used to fund operating expenses is impacted by the timing of when we pay these expenses , as reflected in the change in our accounts payable and accrued research and development and other current liabilities . recent developments initial public offering on september 29 , 2020 , we completed our ipo . as a result of the ipo , we issued and sold an aggregate of 6,468,750 shares of our common stock ( inclusive of 843,750 shares issued and sold pursuant to the exercise of the underwriters ' option to purchase additional shares on october 22 , 2020 ) at a price of $ 16.00 per share for net proceeds of $ 92.0 million , after deducting underwriting discounts , commissions and offering expenses . prior to the completion of the ipo , all 117,809,883 shares of our redeemable convertible preferred stock then outstanding were converted into 13,085,913 shares of common stock . business effects of covid-19 the current covid-19 pandemic has presented a substantial public health and economic challenge around the world and is affecting our employees , patients , clinicians , communities and business operations , as well as the u.s. economy and financial markets . to date , our financial condition and operations have not been significantly impacted by the covid-19 outbreak ; however , the full extent to which the covid-19 pandemic will directly or indirectly impact our business , results of operations , liquidity and financial 77 condition will depend on future developments , which are highly uncertain and can not be accurately predicted , including new information that may emerge concerning covid-19 , the actions taken to contain it or treat its impact and the economic impact on local , regional , national and international markets . to date , our contract research organizations , or cros , contract manufacturing organizations , or cmos , and other vendors have been able to continue to provide services and supply reagents , materials , and products and currently do not anticipate any disruption in services or interruptions in supply . our cmos continue to operate their manufacturing facilities at or near normal levels . while we currently do not anticipate any interruptions in our manufacturing process , it is possible that the covid-19 pandemic and response efforts may have an impact in the future on our third-party suppliers ' and contract manufacturing partners ' ability to manufacture reagents , materials or products that we need to use in our research and upcoming clinical trials . however , we are continuing to assess the potential impact of the covid-19 pandemic on our business and operations , including our expenses , our clinical trials , and our ability to hire and retain employees . while we are currently continuing to monitor patients in our altissimo clinical trial at sites across the united states , we expect that covid-19 precautions may directly or indirectly impact the timeline for some of our clinical trial activities due to the inability of patients to come to their monitoring visits , the closing of eye clinics , and or diversion of resources that are necessary to conduct our observational study to care for covid-19 patients . the covid-19 pandemic has caused us to modify our business practices including , but not limited to , curtailing or modifying employee travel , moving to partial remote work , and cancelling physical participation in meetings , events and conferences . we may take further actions as may be required by government authorities or that we determine are in the best interests of our employees , patients , clinicians , and business partners . the majority of our office-based employees have been working from home since march 2020 , while ensuring essential staffing levels to support our operations remain in place , including maintaining key personnel in our laboratories . for additional information on the various risks posed by the covid-19 pandemic , please read item 1a . risk factors . components of operating results research and development expenses our research and development expenses include : personnel costs , which include salaries , benefits and stock-based compensation ; expenses incurred under agreements with consultants and third-party contract organizations that conduct research and development activities on our behalf ; costs related to sponsored research service agreements ; costs related to production of preclinical and clinical materials , including fees paid to contract manufacturers ; laboratory and vendor expenses related to the execution of preclinical studies and planned clinical trials ; milestones and royalty expense from our johns hopkins university exclusive license agreement ; laboratory supplies and materials used for internal research and development activities ; and facilities and equipment costs . most of our research and development expenses have been related to the preclinical and clinical development of gb-102 . we have not reported program costs since inception because we have not historically tracked or recorded our research and development expenses on a program-by-program basis . we use our personnel and infrastructure resources across the breadth of our research and development activities , which are directed toward identifying and developing product candidates . we expense all research and development costs in the periods in which they are incurred . story_separator_special_tag preferred stock tranche obligation convertible preferred stock that includes features we have determined are not clearly and closely related to the equity host are bifurcated and accounted for separately as freestanding derivative assets or liabilities on the balance sheet at their estimated fair value . we recognized a derivative liability as a result of certain investors ' having rights to purchase from us , on the same terms as the series c preferred stock purchase agreement executed in july 2019 , additional shares of our series c preferred stock in subsequent tranches based on the achievement of certain development milestones , or the preferred stock tranche obligation . at initial recognition , we recorded the liability for the preferred stock tranche obligation on the balance sheet at its estimated fair value . this liability was subject to remeasurement at each balance sheet date until the expiration of the preferred stock tranche obligation in september 2020 , with changes in fair value recognized in our statements of operations . the liability for the preferred stock tranche obligation was measured at fair value using an option pricing valuation methodology that included inputs not observable in the market and thus represents a level 3 measurement . the option pricing valuation methodology utilized requires inputs based on certain subjective assumptions , including ( a ) expected stock price volatility , ( b ) calculation of an expected term , ( c ) a risk-free interest rate and ( d ) expected dividends . significant judgment was used in determining these assumptions at initial recognition and at each subsequent reporting period . stock-based compensation we recognize compensation costs related to stock-based awards to employees and non-employees based on the estimated fair value of the awards on the date of grant . we estimate the grant date fair value , and the resulting stock-based compensation , using the black-scholes option-pricing model , or black-scholes . the grant date fair value of the stock-based awards is generally recognized on a straight-line basis over the requisite service period , which is generally the vesting period of the respective awards . black-scholes requires the use of subjective assumptions to determine the fair value of stock-based awards including : fair value of common stock— see subsection entitled “ common stock valuations ” below . expected term—the expected term represents the period that stock-based awards are expected to be outstanding . the expected term for option grants is determined using the simplified method . the simplified method deems the expected term to be the midpoint between the vesting date and the contractual life of the stock-based awards . expected volatility— since we were a privately held company until september 2020 , and do not yet have sufficient trading history for our common stock , the expected volatility is estimated based on the average volatility for comparable publicly traded biotechnology companies over a period equal to the expected term of the stock option grants . the comparable companies were chosen based on their similar size , stage in the life cycle or area of specialty . we will continue to apply this method until a sufficient amount of historical information over a period equal to the expected term of the stock-based awards becomes available . 84 risk-free interest rate—the risk-free interest rate is based on the u.s. treasury zero coupon issues in effect at the time of grant for periods corresponding with the expected term of the option . expected dividend—we have never paid dividends on our common stock and have no plans to pay dividends on our common stock . therefore , we used an expected dividend yield of zero . we will continue to use judgment in evaluating the assumptions utilized for our stock-based compensation expense calculations on a prospective basis . in addition to the assumptions used in black-scholes , the amount of stock-based compensation expense we recognize in our financial statements includes stock option forfeitures as they occur . such assumptions involve inherent uncertainties and the application of significant judgment . as a result , if factors or expected outcomes change and we use significantly different assumptions or estimates , our stock-based compensation could be materially different . common stock valuations historically , for all periods prior to our ipo , the fair value of the shares of common stock underlying our stock-based awards was estimated on each grant date by our board of directors . in the absence of a public trading market for our common stock , our board of directors exercised their judgment and considered a number of objective and subjective factors to determine the best estimate of the fair value of our common stock , including contemporaneous valuations , our stage of development , important developments in our operations , the prices at which we sold shares of our preferred stock , the rights , preferences and privileges of our preferred stock relative to those of our common stock , actual operating results and financial performance , the conditions in the biotechnology industry and the economy in general , the stock price performance and volatility of comparable public companies , and the lack of liquidity of our common stock , among other factors . in determining the fair value of our common stock , the methodologies used to estimate our enterprise value were performed using methodologies , approaches and assumptions consistent with the guidance outlined in the american institute of certified public accountants technical practice aid , valuation of privately held company equity securities issued as compensation . the grant date fair value of our common stock was determined using valuation methodologies incorporating a number of assumptions including probability weighting of events , volatility , time to liquidation , a risk-free interest rate and an assumption for a discount for lack of marketability ( level 3 inputs ) . the methodology to determine the fair value of our common stock included estimating the fair value of the enterprise using a hybrid-method market approach ,

we strive to be frugal with every expense , including capital expenditures and stock-based compensation . at the same time , we intend to continue to invest thoughtfully for long-term growth , with a focus on growing share in the markets we currently serve . we 've invested , and expect to continue to invest , in marketing to promote the redfin brand and in technology development to make the homebuying and home selling experience better and faster for our customers and our agents , while continuing to lower costs . our growth has been significant . for the years ended december 31 , 2015 , 2016 , and 2017 , we generated revenue of $ 187.3 million , $ 267.2 million , and $ 370.0 million , respectively , representing annual growth of 49 % , 43 % , and 38 % , respectively . we generated net losses of $ 30.2 million , $ 22.5 million , and $ 15.0 million for the years ended december 31 , 2015 , 2016 , and 2017 , respectively initial public offering on august 2 , 2017 , we completed our initial public offering , or ipo , in which we issued and sold 10,615,650 shares of our common stock ( including 1,384,650 shares pursuant to the underwriters ' option to purchase additional shares ) at a public offering price of $ 15.00 per share . the aggregate gross proceeds were approximately $ 159.2 million . we received $ 144.4 million in net proceeds after deducting $ 11.1 million of underwriting discounts and commissions and $ 3.7 million in offering costs . upon the closing of the ipo , all of the outstanding shares of our redeemable convertible preferred stock automatically converted into 55,422,002 shares of common stock on a one-for-one basis . subsequent to the closing of the ipo , there are no shares of redeemable convertible preferred stock outstanding . key business metrics in addition to the measures presented in our consolidated financial statements , we use the following key metrics to evaluate our business , develop financial forecasts , and make strategic decisions . 36 replace_table_token_5_th monthly average visitors the number of , and growth in , visitors to our website and mobile application are important leading indicators of our business activity because these channels are the primary ways we meet customers . for a particular period , monthly average visitors refers to the average of the number of unique visitors to our website and mobile application for each of the months in that period . monthly average visitors are influenced by market conditions that affect interest in buying or selling homes , the level and success of our marketing programs , and seasonality . we believe we can continue to increase monthly visitors , which helps our growth . given the lengthy process to buy or sell a home , a visitor during one month may not convert to a revenue-generating customer until many months later , if at all . when we refer to `` monthly average visitors `` for a particular period , we are referring to the average number of unique visitors to our website and our mobile application for each of the months in that period , as measured by google analytics , a product that provides digital marketing intelligence . visitors are tracked by google analytics using cookies , with a unique cookie being assigned to each browser or mobile application on a device . for any given month , we count all of the unique cookies that visited our website or either our ios or android mobile application during that month ; each such unique cookie is a unique visitor . if a person accesses our mobile application using different devices within a given month , each such mobile device is counted as a separate visitor for that month . if the same person accesses our website using an anonymous browser , or clears or resets cookies on his or her device , each access with a new cookie is counted as a new unique visitor for that month . real estate transactions increasing the number of real estate transactions in which we or our partner agents represent homebuyers and home sellers is critical to increasing our revenue and , in turn , to achieving profitability . real estate transaction volume is influenced by the pricing and quality of our services as well as market conditions that affect home sales , such as local inventory levels and mortgage interest rates . real estate transaction volume is also affected by seasonality and macroeconomic factors . we include a single transaction twice when we or our partner agents serve both the homebuyer and the home seller of a home . 37 real estate revenue per real estate transaction real estate revenue per real estate transaction , together with the number of real estate transactions , is a factor in evaluating business growth and determining pricing . changes in revenue per real estate transaction can be affected by our pricing , the mix of transactions from homebuyers and home sellers , changes in the value of homes in the markets we serve , the geographic mix of our transactions , and the transactions we refer to partner agents . we generally generate more revenue per real estate transaction from representing homebuyers than home sellers . from 2015 through 2017 , the percentage of brokerage transactions from home sellers increased from slightly over 25 % to slightly over 35 % . we expect this trend to continue , because we believe that representing homes sellers has unique strategic value , including the marketing power of yard signs and digital marketing campaigns , and the market effect of controlling listing inventory . to keep revenue per brokerage transactions about the same from year to year , we expect to reduce our commission refund to homebuyers as more of our brokerage transactions come from home sellers . story_separator_special_tag story_separator_special_tag beginning in mid-2017 and lasting through 2027. our purchase obligations primarily relate to the noncancelable portion of commitments related to our network infrastructure and annual employee meeting . we do not include in the table above obligations under contracts that we can cancel without significant penalty . we also include the purchase prices of homes that we are under contract to purchase through redfin now but that have not yet closed . there were three such homes as of december 31 , 2017. critical accounting policies and estimates discussion and analysis of our financial condition and results of operations are based on our financial statements , which have been prepared in accordance with gaap . preparing these financial statements requires us to make estimates and judgments that affect the reported amounts of assets and liabilities and related disclosure of contingent assets and liabilities , revenue , and expenses at the date of 49 the financial statements . generally , we base our estimates on historical experience and on various other assumptions in accordance with gaap that we believe to be reasonable under the circumstances . actual results may differ from these estimates under different assumptions or conditions . critical accounting policies and estimates are those that we consider the most important to the portrayal of our financial condition and results of operations because they require our most difficult , subjective , or complex judgments , often as a result of the need to make estimates about the effect of matters that are inherently uncertain . our critical accounting policies and estimates include those related to revenue recognition and stock-based compensation . revenue recognition revenue primarily consists of commissions and fees charged on each real estate transaction completed by us or our partner agents . we recognize commission-based brokerage revenue upon closing of a real estate transaction , net of any commission refund , closing-cost adjustment , commission discount or transaction fee adjustment . partner revenue consists of fees earned by referring customers to partner agents . partner revenue is earned and recognized when partner agents close a referred transaction , net of any refund provided to customers . revenue earned from selling homes previously purchased by redfin now is recorded at closing on a gross basis , representing the sales price of the home . revenue earned but not received is recorded as accrued revenue on the accompanying consolidated balance sheets . fees and revenue from other services are recognized when the service is provided . we have completed our analysis of the new revenue standard , revenue from contracts with customers ( topic 606 ) , and determined the adoption will not have a material impact on our financial statements . for further discussion of the new revenue standard , please see note 1 to our consolidated financial statements included elsewhere in annual report on form 10-k. stock-based compensation stock-based compensation is measured at the grant date based on the fair value of the award and is recognized as expense , net of estimated forfeitures , over the requisite service period , which is generally the vesting period of the respective award . determining the fair value of stock options at the grant date is highly complex and subjective and requires significant judgment . we use the black-scholes-merton option-pricing model to determine the fair value of stock options , the output of which is affected by a number of variables . these variables include the fair value of our common stock , our expected common stock price volatility over the expected life of the options , expected term of the stock option , risk-free interest rates and expected dividends , which are estimated as follows : fair value of our common stock . prior to our ipo , the fair value of the shares of our common stock underlying stock options was established by our board of directors with the assistance of an independent third-party valuation firm . because there was no public market for our common stock , our board of directors has relied on this independent valuation and other factors to establish the fair value of our common stock at the time of grant of the option . expected life . the expected term was estimated using the simplified method allowed under sec guidance . volatility . prior to our ipo , the expected stock price volatility for our common stock was estimated by taking the average historical price volatility for industry peers based on daily price observations . industry peers consist of several public companies in the real estate brokerage and technology industries . in 2015 , we changed the group of industry peers due to external mergers and acquisitions in the real estate industry . 50 risk-free rate . the risk-free interest rate is based on the yields of u.s. treasury securities with maturities similar to the expected term of the options for each option group . dividend yield . we have never declared or paid any cash dividends and do not presently plan to pay cash dividends in the foreseeable future . consequently , we used an expected dividend yield of zero . on january 1 , 2017 , we adopted accounting standards update , or asu , 2016-09 and elected to book forfeitures as they occur , using the modified retrospective approach through a cumulative-effect adjustment of approximately $ 0.5 million to beginning accumulative deficit . the adoption of this guidance did not have a material impact on our financial position , results of operations or cash flows . in late 2017 , we began issuing restricted stock units ( rsus ) as the primary form of equity compensation for our employees . compensation cost for restricted stock units is measured at the fair value on the grant date and recognized as expense over the related service period . valuation of common stock and redeemable convertible preferred stock prior to our ipo , given the absence of a public trading market for

liquidity and capital resources 47 on august 2 , 2017 , we closed our ipo of 10,615,650 shares of our common stock at a public offering price of $ 15.00 per share . we received approximately $ 144.4 million in net proceeds after deducting underwriting discounts and commission , and offering costs . prior to our ipo , our principal sources of liquidity were the net proceeds we received through private sales of our equity securities . from our inception through our ipo , we completed several rounds of sales of shares of our redeemable convertible preferred stock to investors , with total gross proceeds of approximately $ 167.5 million . in the first quarter of 2017 , we introduced redfin mortgage to originate and underwrite mortgage loans , and began testing a new service called redfin now , where we buy homes directly from home sellers , intending to resell those homes . to date , neither business has had a material impact on our liquidity . as of december 31 , 2017 , we held $ 3.4 million of home inventory . if we decide to significantly expand these new product offerings , we may seek to raise additional capital through equity , equity-linked , or debt-financing arrangements to fund this expansion . we can not assure you that any additional financing will be available to us on acceptable terms or at all . cash flows the following table summarizes our cash flows for the periods indicated : replace_table_token_21_th cash flows from operating activities net cash provided by operating activities in 2017 consisted of $ 15.0 million of net losses , an $ 18.3 million positive impact from non-cash items , an $ 8.4 million reduction in miscellaneous receivables when the landlord for our seattle headquarters office reimbursed us for tenant improvements , and a $ 4.9

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```liquidity and capital resources 47 on august 2 , 2017 , we closed our ipo of 10,615,650 shares of our common stock at a public offering price of $ 15.00 per share . we received approximately $ 144.4 million in net proceeds after deducting underwriting discounts and commission , and offering costs . prior to our ipo , our principal sources of liquidity were the net proceeds we received through private sales of our equity securities . from our inception through our ipo , we completed several rounds of sales of shares of our redeemable convertible preferred stock to investors , with total gross proceeds of approximately $ 167.5 million . in the first quarter of 2017 , we introduced redfin mortgage to originate and underwrite mortgage loans , and began testing a new service called redfin now , where we buy homes directly from home sellers , intending to resell those homes . to date , neither business has had a material impact on our liquidity . as of december 31 , 2017 , we held $ 3.4 million of home inventory . if we decide to significantly expand these new product offerings , we may seek to raise additional capital through equity , equity-linked , or debt-financing arrangements to fund this expansion . we can not assure you that any additional financing will be available to us on acceptable terms or at all . cash flows the following table summarizes our cash flows for the periods indicated : replace_table_token_21_th cash flows from operating activities net cash provided by operating activities in 2017 consisted of $ 15.0 million of net losses , an $ 18.3 million positive impact from non-cash items , an $ 8.4 million reduction in miscellaneous receivables when the landlord for our seattle headquarters office reimbursed us for tenant improvements , and a $ 4.9 ``` Suspicious Activity Report : we strive to be frugal with every expense , including capital expenditures and stock-based compensation . at the same time , we intend to continue to invest thoughtfully for long-term growth , with a focus on growing share in the markets we currently serve . we 've invested , and expect to continue to invest , in marketing to promote the redfin brand and in technology development to make the homebuying and home selling experience better and faster for our customers and our agents , while continuing to lower costs . our growth has been significant . for the years ended december 31 , 2015 , 2016 , and 2017 , we generated revenue of $ 187.3 million , $ 267.2 million , and $ 370.0 million , respectively , representing annual growth of 49 % , 43 % , and 38 % , respectively . we generated net losses of $ 30.2 million , $ 22.5 million , and $ 15.0 million for the years ended december 31 , 2015 , 2016 , and 2017 , respectively initial public offering on august 2 , 2017 , we completed our initial public offering , or ipo , in which we issued and sold 10,615,650 shares of our common stock ( including 1,384,650 shares pursuant to the underwriters ' option to purchase additional shares ) at a public offering price of $ 15.00 per share . the aggregate gross proceeds were approximately $ 159.2 million . we received $ 144.4 million in net proceeds after deducting $ 11.1 million of underwriting discounts and commissions and $ 3.7 million in offering costs . upon the closing of the ipo , all of the outstanding shares of our redeemable convertible preferred stock automatically converted into 55,422,002 shares of common stock on a one-for-one basis . subsequent to the closing of the ipo , there are no shares of redeemable convertible preferred stock outstanding . key business metrics in addition to the measures presented in our consolidated financial statements , we use the following key metrics to evaluate our business , develop financial forecasts , and make strategic decisions . 36 replace_table_token_5_th monthly average visitors the number of , and growth in , visitors to our website and mobile application are important leading indicators of our business activity because these channels are the primary ways we meet customers . for a particular period , monthly average visitors refers to the average of the number of unique visitors to our website and mobile application for each of the months in that period . monthly average visitors are influenced by market conditions that affect interest in buying or selling homes , the level and success of our marketing programs , and seasonality . we believe we can continue to increase monthly visitors , which helps our growth . given the lengthy process to buy or sell a home , a visitor during one month may not convert to a revenue-generating customer until many months later , if at all . when we refer to `` monthly average visitors `` for a particular period , we are referring to the average number of unique visitors to our website and our mobile application for each of the months in that period , as measured by google analytics , a product that provides digital marketing intelligence . visitors are tracked by google analytics using cookies , with a unique cookie being assigned to each browser or mobile application on a device . for any given month , we count all of the unique cookies that visited our website or either our ios or android mobile application during that month ; each such unique cookie is a unique visitor . if a person accesses our mobile application using different devices within a given month , each such mobile device is counted as a separate visitor for that month . if the same person accesses our website using an anonymous browser , or clears or resets cookies on his or her device , each access with a new cookie is counted as a new unique visitor for that month . real estate transactions increasing the number of real estate transactions in which we or our partner agents represent homebuyers and home sellers is critical to increasing our revenue and , in turn , to achieving profitability . real estate transaction volume is influenced by the pricing and quality of our services as well as market conditions that affect home sales , such as local inventory levels and mortgage interest rates . real estate transaction volume is also affected by seasonality and macroeconomic factors . we include a single transaction twice when we or our partner agents serve both the homebuyer and the home seller of a home . 37 real estate revenue per real estate transaction real estate revenue per real estate transaction , together with the number of real estate transactions , is a factor in evaluating business growth and determining pricing . changes in revenue per real estate transaction can be affected by our pricing , the mix of transactions from homebuyers and home sellers , changes in the value of homes in the markets we serve , the geographic mix of our transactions , and the transactions we refer to partner agents . we generally generate more revenue per real estate transaction from representing homebuyers than home sellers . from 2015 through 2017 , the percentage of brokerage transactions from home sellers increased from slightly over 25 % to slightly over 35 % . we expect this trend to continue , because we believe that representing homes sellers has unique strategic value , including the marketing power of yard signs and digital marketing campaigns , and the market effect of controlling listing inventory . to keep revenue per brokerage transactions about the same from year to year , we expect to reduce our commission refund to homebuyers as more of our brokerage transactions come from home sellers . story_separator_special_tag story_separator_special_tag beginning in mid-2017 and lasting through 2027. our purchase obligations primarily relate to the noncancelable portion of commitments related to our network infrastructure and annual employee meeting . we do not include in the table above obligations under contracts that we can cancel without significant penalty . we also include the purchase prices of homes that we are under contract to purchase through redfin now but that have not yet closed . there were three such homes as of december 31 , 2017. critical accounting policies and estimates discussion and analysis of our financial condition and results of operations are based on our financial statements , which have been prepared in accordance with gaap . preparing these financial statements requires us to make estimates and judgments that affect the reported amounts of assets and liabilities and related disclosure of contingent assets and liabilities , revenue , and expenses at the date of 49 the financial statements . generally , we base our estimates on historical experience and on various other assumptions in accordance with gaap that we believe to be reasonable under the circumstances . actual results may differ from these estimates under different assumptions or conditions . critical accounting policies and estimates are those that we consider the most important to the portrayal of our financial condition and results of operations because they require our most difficult , subjective , or complex judgments , often as a result of the need to make estimates about the effect of matters that are inherently uncertain . our critical accounting policies and estimates include those related to revenue recognition and stock-based compensation . revenue recognition revenue primarily consists of commissions and fees charged on each real estate transaction completed by us or our partner agents . we recognize commission-based brokerage revenue upon closing of a real estate transaction , net of any commission refund , closing-cost adjustment , commission discount or transaction fee adjustment . partner revenue consists of fees earned by referring customers to partner agents . partner revenue is earned and recognized when partner agents close a referred transaction , net of any refund provided to customers . revenue earned from selling homes previously purchased by redfin now is recorded at closing on a gross basis , representing the sales price of the home . revenue earned but not received is recorded as accrued revenue on the accompanying consolidated balance sheets . fees and revenue from other services are recognized when the service is provided . we have completed our analysis of the new revenue standard , revenue from contracts with customers ( topic 606 ) , and determined the adoption will not have a material impact on our financial statements . for further discussion of the new revenue standard , please see note 1 to our consolidated financial statements included elsewhere in annual report on form 10-k. stock-based compensation stock-based compensation is measured at the grant date based on the fair value of the award and is recognized as expense , net of estimated forfeitures , over the requisite service period , which is generally the vesting period of the respective award . determining the fair value of stock options at the grant date is highly complex and subjective and requires significant judgment . we use the black-scholes-merton option-pricing model to determine the fair value of stock options , the output of which is affected by a number of variables . these variables include the fair value of our common stock , our expected common stock price volatility over the expected life of the options , expected term of the stock option , risk-free interest rates and expected dividends , which are estimated as follows : fair value of our common stock . prior to our ipo , the fair value of the shares of our common stock underlying stock options was established by our board of directors with the assistance of an independent third-party valuation firm . because there was no public market for our common stock , our board of directors has relied on this independent valuation and other factors to establish the fair value of our common stock at the time of grant of the option . expected life . the expected term was estimated using the simplified method allowed under sec guidance . volatility . prior to our ipo , the expected stock price volatility for our common stock was estimated by taking the average historical price volatility for industry peers based on daily price observations . industry peers consist of several public companies in the real estate brokerage and technology industries . in 2015 , we changed the group of industry peers due to external mergers and acquisitions in the real estate industry . 50 risk-free rate . the risk-free interest rate is based on the yields of u.s. treasury securities with maturities similar to the expected term of the options for each option group . dividend yield . we have never declared or paid any cash dividends and do not presently plan to pay cash dividends in the foreseeable future . consequently , we used an expected dividend yield of zero . on january 1 , 2017 , we adopted accounting standards update , or asu , 2016-09 and elected to book forfeitures as they occur , using the modified retrospective approach through a cumulative-effect adjustment of approximately $ 0.5 million to beginning accumulative deficit . the adoption of this guidance did not have a material impact on our financial position , results of operations or cash flows . in late 2017 , we began issuing restricted stock units ( rsus ) as the primary form of equity compensation for our employees . compensation cost for restricted stock units is measured at the fair value on the grant date and recognized as expense over the related service period . valuation of common stock and redeemable convertible preferred stock prior to our ipo , given the absence of a public trading market for

recent developments registered block trade transactions on november 18 , 2015 , we closed an underwritten secondary offering of 4,500,000 shares of our common stock by welsh , carson , anderson & stowe x , l.p. ( “ wcas x ” ) , wcas capital partners iv , l.p. ( “ wcas capital iv ” ) , each of our executive officers and certain other selling stockholders at a public offering price of $ 42.15 per share . on november 19 , 2015 , the underwriter exercised its overallotment option and subsequently purchased an additional 585,697 shares from wcas x and wcas capital iv . we did not receive any proceeds from the sales of these shares . on september 15 , 2015 , we closed an underwritten secondary offering of 4,500,000 shares of our common stock by wcas x , wcas capital partners iv , each of our executive officers and certain other selling stockholders at a public offering price of $ 37.95 per share . on september 23 , 2015 , the underwriter exercised its option to purchase an additional 675,000 shares from wcas x and wcas capital iv . we did not receive any proceeds from the sales of these shares . on may 20 , 2015 , we closed an underwritten secondary offering of 8,000,000 shares of our common stock by wcas x , wcas capital iv , each of our executive officers and certain other selling stockholders at a public offering price of $ 36.25 per share . we did not receive any proceeds from the sale of these shares . 33 follow-on offering on january 21 , 2015 , we closed a follow-on public offering of 6,422,750 shares of our common stock by certain selling stockholders at a public offering price of $ 22.50 per share . we did not receive any proceeds from the sale of these shares . the 2014 reorganization software and its wholly owned subsidiary , payroll software merger sub , llc ( “ merger sub ” ) were formed as delaware entities on october 31 , 2013 and december 23 , 2013 , respectively , in anticipation of an initial public offering and were wholly owned subsidiaries of holdings prior to december 31 , 2013. on january 1 , 2014 , we consummated a reorganization pursuant to which ( i ) wcas x and wcas capital iv contributed wcas holdings and wcas cp iv blocker , inc. ( “ cp iv blocker ” ) , which together owned all of the series a preferred units of holdings , to software in exchange for shares of common stock of software , and ( ii ) the owners of outstanding series b preferred units of holdings contributed their series b preferred units of holdings to software in exchange for shares of common stock of software . immediately after these contributions , merger sub merged with and into holdings with holdings surviving the merger . upon consummation of the merger , the remaining holders of outstanding common and incentive units of holdings received shares of common and restricted stock of software for their common and incentive units by operation of delaware law , and holdings ' ownership interest in software was cancelled . outstanding common units , series b preferred units and wcas holdings and cp iv blocker were contributed to software in exchange for , or converted into , an aggregate of 45,708,573 shares of common stock and 8,121,101 shares of restricted stock of software . prior to the reorganization , wcas holdings held $ 46.2 million of series c preferred units of holdings , and wcas holdings had a 14 % note due april 3 , 2017 in the amount of $ 46.2 million , which was payable to wcas x ( the “ 2017 note ” ) . following the exchange of the series a preferred units and series b preferred units for shares of common stock of software , all outstanding series c preferred units of holdings were eliminated in an intercompany transaction between holdings and wcas holdings , we assumed the 2017 note and software became a holding company with its principal assets being the series b preferred units of holdings and the outstanding capital stock of wcas holdings and cp iv blocker . the foregoing transactions are referred to collectively as the “ 2014 reorganization ” . software 's acquisition of wcas holdings and holdings in the 2014 reorganization represented transactions under common control and were required to be retrospectively applied to the financial statements for all prior periods when the financial statements were issued for a period that included the date the transactions occurred . this includes a retrospective presentation for all equity related disclosures , including share , per share , and restricted stock disclosures , which have been revised to reflect the effects of the 2014 reorganization . therefore , our consolidated financial statements are presented as if wcas holdings and holdings were our wholly owned subsidiaries in periods prior to the 2014 reorganization . the acquisition of cp iv blocker was not deemed to be a reorganization under common control and therefore our historical consolidated financial statements include the ownership of a minority equity interest in cp iv blocker , which was eliminated upon the acquisition of cp iv blocker in the 2014 reorganization on january 1 , 2014. trends and opportunities our payroll application is the foundation of our solution and all of our clients are required to utilize this application in order to access our other applications . as a result of our evolving revenue mix , coupled with the unique client benefits that our solution provides ( e.g . , enabling our clients to scale the number of hcm applications that they use on an as-needed basis ) , we are presented with a variety of opportunities and challenges . story_separator_special_tag sales and marketing expenses increased $ 29.0 million primarily due to a $ 14.9 million increase in commission and bonuses and a $ 9.9 million increase in employee-related expenses , in each case resulting from increased sales , and a $ 0.8 million increase in recruiting and training expenses related to an increase in the number of sales personnel . research and development expenses increased by $ 4.3 million primarily due to an increase in the number of research and development personnel . we anticipate a gradual increase in research and development expense over time as we continue to increase the number of research and development personnel . general and administrative expenses increased by $ 12.3 million primarily due to a $ 6.8 million increase in employee-related expenses , a $ 1.8 million increase in accounting , compliance , legal and insurance expense , an increase of $ 0.6 million in employee travel expenses and an increase of $ 0.5 million in telecommunications expenses related to expansion of our company headquarters . depreciation and amortization increased by $ 1.2 million primarily due to assets purchased and additional technology developed . 39 total administrative expenses were $ 107.9 milli on for the year ended december 31 , 2014 , compared to $ 77.2 million for the year ended december 31 , 2013 , representing an increase of $ 30.7 million , or 40 % . sales and marketing expenses increased $ 20.9 million primarily due to a $ 9.4 million increase in emp loyee-related expenses , resulting from a 31 % increase in the number of personnel , a $ 6.7 million increase in commission and bonuses , resulting from increased sales , a $ 1.7 million increase in rent and building expenses due to the opening of five new office s as well as an increase in the number of personnel at existing offices , a $ 0.8 million increase in sales travel expense due to the increase in personnel and a $ 0.8 million increase in marketing expense p rimarily due to increased p rint advertising . researc h and development expenses increased by $ 2.2 million primarily due to a 60 % increase i n the number of research and development personnel , along with related bonus expense . general and administrative expenses increased by $ 6.8 million primarily due to a $ 4 . 5 million increase in employee-related expenses , resulting from a 16 % increase in the number of personnel , and $ 2.0 million of expenses related to the initial public offering . depreciation and amortization increased by $ 0.9 million primarily due to the com pletion of our second building at our corporate headquarters in oklahoma city in june 2014 and purchases of additional assets . expenditures for software developed or obtained for internal use are capitalized and amortized over a three-year period on a straight-line basis . the table below sets forth the amounts of capitalized and expensed research and development expenses for the years ended december 31 , 2015 , 2014 and 2013. replace_table_token_12_th quarterly results of operations the following table sets forth selected unaudited quarterly consolidated statements of income data for each of the 12 quarters within the three-year period ended december 31 , 2015. the information for each of these quarters has been prepared on the same basis as the audited annual consolidated financial statements included elsewhere in this annual report on form 10-k and , in the opinion of management , includes all adjustments , which includes only normal recurring adjustments , necessary for the fair presentation of the results of operations for these periods in accordance with u.s. gaap . this data should be read in conjunction with our audited consolidated financial statements and related notes included elsewhere in this annual report on form 10-k. these quarterly operating results are not necessarily indicative of our operating results for a full year or any future period ( in thousands ) . replace_table_token_13_th 40 quarterly revenues trends excluding changes in quarterly revenues due to seasonal factors , our quarterly revenues generally increased sequentially for the periods presented due to a combination of factors , including the addition of clients in mature sales offices ( those offices that have been open for at least 24 months ) , the addition of new clients in more recently opened sales offices , the introduction and sale of additional applications to our existing clients and the growth in the number of employees of our clients . we anticipate that , commencing in 2016 , first quarter revenues will also exhibit a stronger seasonal pattern as a result of the enactment of the aca , which requires clients to file forms 1094 and 1095 in the first quarter . there are also seasonal factors that affect our revenues . recurring revenues include revenues relating to the annual processing of payroll forms such as form w-2 and form 1099 , or payroll form revenues . because these forms are typically processed in the first quarter of the year , first quarter revenue and margins are generally higher than subsequent quarters . quarterly expenses trends selling , general and administrative expenses are generally higher in the fourth and first quarters as sales representatives achieve sales goals throughout the year , resulting in higher commission rates . these sales goals reset annually on february 1. liquidity and capital resources our principal sources of liquidity are cash and cash equivalents which totaled $ 50.7 million and $ 25.1 million as of december 31 , 2015 and 2014 , respectively . our cash and cash equivalents are comprised primarily of deposit accounts and money market funds . we believe our existing cash and cash equivalents will be sufficient to meet our working capital and capital expenditure needs over at least the next 12 months . we have historically financed our operations from cash flows generated from operations , cash from the sale of debt and equity securities and borrowings

cash flow analysis our cash flows from operating activities have historically been significantly impacted by profitability , implementation revenue received but deferred , research and development , and our investment in sales and marketing to drive growth . our ability to meet future liquidity needs will be driven by our operating performance and the extent of continued investment in our operations . failure to generate sufficient revenue and related cash flows or to raise additional capital could have a material adverse effect on our ability to meet our liquidity needs and achieve our business objectives . as part of our payroll and payroll tax filing services , we collect funds from our clients for federal , state and local employment taxes , which we remit to the appropriate tax agencies . we invest these funds in short-term certificates of deposit and money market funds from which we earn interest income during the period between their receipt and disbursement . as our business grows , we expect our capital expenditures and our investment activity to continue to increase . depending on certain growth opportunities , we may choose to accelerate investments in sales and marketing , acquisitions , technology and services . actual future capital requirements will depend on many factors , including our future revenues , cash from operating activities and the level of expenditures in all areas of our business . year ended december 31 , 2015 compared to the year ended december 31 , 2014 and the year ended december 31 , 2014 compared to the year ended december 31 , 2013 the following table summarizes the consolidated statements of cash flows for the years ended december 31 , 2015 , 2014 and 2013 : replace_table_token_14_th operating activities for the year ended december 31 , 2015 , net cash provided by operating activities was $ 43.0 million .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```cash flow analysis our cash flows from operating activities have historically been significantly impacted by profitability , implementation revenue received but deferred , research and development , and our investment in sales and marketing to drive growth . our ability to meet future liquidity needs will be driven by our operating performance and the extent of continued investment in our operations . failure to generate sufficient revenue and related cash flows or to raise additional capital could have a material adverse effect on our ability to meet our liquidity needs and achieve our business objectives . as part of our payroll and payroll tax filing services , we collect funds from our clients for federal , state and local employment taxes , which we remit to the appropriate tax agencies . we invest these funds in short-term certificates of deposit and money market funds from which we earn interest income during the period between their receipt and disbursement . as our business grows , we expect our capital expenditures and our investment activity to continue to increase . depending on certain growth opportunities , we may choose to accelerate investments in sales and marketing , acquisitions , technology and services . actual future capital requirements will depend on many factors , including our future revenues , cash from operating activities and the level of expenditures in all areas of our business . year ended december 31 , 2015 compared to the year ended december 31 , 2014 and the year ended december 31 , 2014 compared to the year ended december 31 , 2013 the following table summarizes the consolidated statements of cash flows for the years ended december 31 , 2015 , 2014 and 2013 : replace_table_token_14_th operating activities for the year ended december 31 , 2015 , net cash provided by operating activities was $ 43.0 million . ``` Suspicious Activity Report : recent developments registered block trade transactions on november 18 , 2015 , we closed an underwritten secondary offering of 4,500,000 shares of our common stock by welsh , carson , anderson & stowe x , l.p. ( “ wcas x ” ) , wcas capital partners iv , l.p. ( “ wcas capital iv ” ) , each of our executive officers and certain other selling stockholders at a public offering price of $ 42.15 per share . on november 19 , 2015 , the underwriter exercised its overallotment option and subsequently purchased an additional 585,697 shares from wcas x and wcas capital iv . we did not receive any proceeds from the sales of these shares . on september 15 , 2015 , we closed an underwritten secondary offering of 4,500,000 shares of our common stock by wcas x , wcas capital partners iv , each of our executive officers and certain other selling stockholders at a public offering price of $ 37.95 per share . on september 23 , 2015 , the underwriter exercised its option to purchase an additional 675,000 shares from wcas x and wcas capital iv . we did not receive any proceeds from the sales of these shares . on may 20 , 2015 , we closed an underwritten secondary offering of 8,000,000 shares of our common stock by wcas x , wcas capital iv , each of our executive officers and certain other selling stockholders at a public offering price of $ 36.25 per share . we did not receive any proceeds from the sale of these shares . 33 follow-on offering on january 21 , 2015 , we closed a follow-on public offering of 6,422,750 shares of our common stock by certain selling stockholders at a public offering price of $ 22.50 per share . we did not receive any proceeds from the sale of these shares . the 2014 reorganization software and its wholly owned subsidiary , payroll software merger sub , llc ( “ merger sub ” ) were formed as delaware entities on october 31 , 2013 and december 23 , 2013 , respectively , in anticipation of an initial public offering and were wholly owned subsidiaries of holdings prior to december 31 , 2013. on january 1 , 2014 , we consummated a reorganization pursuant to which ( i ) wcas x and wcas capital iv contributed wcas holdings and wcas cp iv blocker , inc. ( “ cp iv blocker ” ) , which together owned all of the series a preferred units of holdings , to software in exchange for shares of common stock of software , and ( ii ) the owners of outstanding series b preferred units of holdings contributed their series b preferred units of holdings to software in exchange for shares of common stock of software . immediately after these contributions , merger sub merged with and into holdings with holdings surviving the merger . upon consummation of the merger , the remaining holders of outstanding common and incentive units of holdings received shares of common and restricted stock of software for their common and incentive units by operation of delaware law , and holdings ' ownership interest in software was cancelled . outstanding common units , series b preferred units and wcas holdings and cp iv blocker were contributed to software in exchange for , or converted into , an aggregate of 45,708,573 shares of common stock and 8,121,101 shares of restricted stock of software . prior to the reorganization , wcas holdings held $ 46.2 million of series c preferred units of holdings , and wcas holdings had a 14 % note due april 3 , 2017 in the amount of $ 46.2 million , which was payable to wcas x ( the “ 2017 note ” ) . following the exchange of the series a preferred units and series b preferred units for shares of common stock of software , all outstanding series c preferred units of holdings were eliminated in an intercompany transaction between holdings and wcas holdings , we assumed the 2017 note and software became a holding company with its principal assets being the series b preferred units of holdings and the outstanding capital stock of wcas holdings and cp iv blocker . the foregoing transactions are referred to collectively as the “ 2014 reorganization ” . software 's acquisition of wcas holdings and holdings in the 2014 reorganization represented transactions under common control and were required to be retrospectively applied to the financial statements for all prior periods when the financial statements were issued for a period that included the date the transactions occurred . this includes a retrospective presentation for all equity related disclosures , including share , per share , and restricted stock disclosures , which have been revised to reflect the effects of the 2014 reorganization . therefore , our consolidated financial statements are presented as if wcas holdings and holdings were our wholly owned subsidiaries in periods prior to the 2014 reorganization . the acquisition of cp iv blocker was not deemed to be a reorganization under common control and therefore our historical consolidated financial statements include the ownership of a minority equity interest in cp iv blocker , which was eliminated upon the acquisition of cp iv blocker in the 2014 reorganization on january 1 , 2014. trends and opportunities our payroll application is the foundation of our solution and all of our clients are required to utilize this application in order to access our other applications . as a result of our evolving revenue mix , coupled with the unique client benefits that our solution provides ( e.g . , enabling our clients to scale the number of hcm applications that they use on an as-needed basis ) , we are presented with a variety of opportunities and challenges . story_separator_special_tag sales and marketing expenses increased $ 29.0 million primarily due to a $ 14.9 million increase in commission and bonuses and a $ 9.9 million increase in employee-related expenses , in each case resulting from increased sales , and a $ 0.8 million increase in recruiting and training expenses related to an increase in the number of sales personnel . research and development expenses increased by $ 4.3 million primarily due to an increase in the number of research and development personnel . we anticipate a gradual increase in research and development expense over time as we continue to increase the number of research and development personnel . general and administrative expenses increased by $ 12.3 million primarily due to a $ 6.8 million increase in employee-related expenses , a $ 1.8 million increase in accounting , compliance , legal and insurance expense , an increase of $ 0.6 million in employee travel expenses and an increase of $ 0.5 million in telecommunications expenses related to expansion of our company headquarters . depreciation and amortization increased by $ 1.2 million primarily due to assets purchased and additional technology developed . 39 total administrative expenses were $ 107.9 milli on for the year ended december 31 , 2014 , compared to $ 77.2 million for the year ended december 31 , 2013 , representing an increase of $ 30.7 million , or 40 % . sales and marketing expenses increased $ 20.9 million primarily due to a $ 9.4 million increase in emp loyee-related expenses , resulting from a 31 % increase in the number of personnel , a $ 6.7 million increase in commission and bonuses , resulting from increased sales , a $ 1.7 million increase in rent and building expenses due to the opening of five new office s as well as an increase in the number of personnel at existing offices , a $ 0.8 million increase in sales travel expense due to the increase in personnel and a $ 0.8 million increase in marketing expense p rimarily due to increased p rint advertising . researc h and development expenses increased by $ 2.2 million primarily due to a 60 % increase i n the number of research and development personnel , along with related bonus expense . general and administrative expenses increased by $ 6.8 million primarily due to a $ 4 . 5 million increase in employee-related expenses , resulting from a 16 % increase in the number of personnel , and $ 2.0 million of expenses related to the initial public offering . depreciation and amortization increased by $ 0.9 million primarily due to the com pletion of our second building at our corporate headquarters in oklahoma city in june 2014 and purchases of additional assets . expenditures for software developed or obtained for internal use are capitalized and amortized over a three-year period on a straight-line basis . the table below sets forth the amounts of capitalized and expensed research and development expenses for the years ended december 31 , 2015 , 2014 and 2013. replace_table_token_12_th quarterly results of operations the following table sets forth selected unaudited quarterly consolidated statements of income data for each of the 12 quarters within the three-year period ended december 31 , 2015. the information for each of these quarters has been prepared on the same basis as the audited annual consolidated financial statements included elsewhere in this annual report on form 10-k and , in the opinion of management , includes all adjustments , which includes only normal recurring adjustments , necessary for the fair presentation of the results of operations for these periods in accordance with u.s. gaap . this data should be read in conjunction with our audited consolidated financial statements and related notes included elsewhere in this annual report on form 10-k. these quarterly operating results are not necessarily indicative of our operating results for a full year or any future period ( in thousands ) . replace_table_token_13_th 40 quarterly revenues trends excluding changes in quarterly revenues due to seasonal factors , our quarterly revenues generally increased sequentially for the periods presented due to a combination of factors , including the addition of clients in mature sales offices ( those offices that have been open for at least 24 months ) , the addition of new clients in more recently opened sales offices , the introduction and sale of additional applications to our existing clients and the growth in the number of employees of our clients . we anticipate that , commencing in 2016 , first quarter revenues will also exhibit a stronger seasonal pattern as a result of the enactment of the aca , which requires clients to file forms 1094 and 1095 in the first quarter . there are also seasonal factors that affect our revenues . recurring revenues include revenues relating to the annual processing of payroll forms such as form w-2 and form 1099 , or payroll form revenues . because these forms are typically processed in the first quarter of the year , first quarter revenue and margins are generally higher than subsequent quarters . quarterly expenses trends selling , general and administrative expenses are generally higher in the fourth and first quarters as sales representatives achieve sales goals throughout the year , resulting in higher commission rates . these sales goals reset annually on february 1. liquidity and capital resources our principal sources of liquidity are cash and cash equivalents which totaled $ 50.7 million and $ 25.1 million as of december 31 , 2015 and 2014 , respectively . our cash and cash equivalents are comprised primarily of deposit accounts and money market funds . we believe our existing cash and cash equivalents will be sufficient to meet our working capital and capital expenditure needs over at least the next 12 months . we have historically financed our operations from cash flows generated from operations , cash from the sale of debt and equity securities and borrowings

the holders of a majority of the private placement warrants ( or underlying securities ) can elect to exercise these registration rights at any time after we consummate a business combination . in addition , the holders have certain “ piggy-back ” registration rights with respect to registration statements filed subsequent to our consummation of a business combination . we will bear the expenses incurred in connection with the filing of any such registration statements . 30 the holders of the first purchase option are entitled to registration rights . the holders of a majority of the first purchase option and the securities underlying such option are entitled to make one demand that we register the options and or the securities underlying the first purchase option . the demand for registration may be made at any time until march 16 , 2017. in addition , the holders have certain “ piggy-back ” registration rights with respect to registration statements filed prior to march 16 , 2019. we will bear the expenses incurred in connection with the filing of any such registration statements , other than any underwriting commissions which will be paid by the holders themselves . the holders of the second purchase option will be entitled to registration rights . the holders of a majority of the second purchase option and the securities underlying such option are entitled to make one demand that we register the options and or the securities underlying the second purchase option . the demand for registration may be made at any time until march 16 , 2017. in addition , the holders have certain “ piggy-back ” registration rights with respect to registration statements filed during the seven year period commencing on the effective date of the registration statement of which this prospectus forms a part . we will bear the expenses incurred in connection with the filing of any such registration statements , other than any underwriting commissions which will be paid by the holders themselves . prior to our ipo , a. lorne weil advanced to us an aggregate of $ 100,000 to cover expenses related to the offering . the loan was payable without interest on the earlier of ( i ) november 8 , 2012 , ( ii story_separator_special_tag forward-looking statements this annual report on form 10-k includes forward-looking statements within the meaning of section 27a of the securities act of 1933 , as amended , and section 21e of the securities exchange act of 1934 , as amended ( the “ exchange act ” ) . we have based these forward-looking statements on our current expectations and projections about future events . these forward-looking statements are subject to known and unknown risks , uncertainties and assumptions about us that may cause our actual results , levels of activity , performance or achievements to be materially different from any future results , levels of activity , performance or achievements expressed or implied by such forward-looking statements . in some cases , you can identify forward-looking statements by terminology such as “ may , ” “ should , ” “ could , ” “ would , ” “ expect , ” “ plan , ” “ anticipate , ” “ believe , ” “ estimate , ” “ continue , ” or the negative of such terms or other similar expressions . factors that might cause or contribute to such a discrepancy include , but are not limited to , those described in our other securities and exchange commission ( “ sec ” ) filings . references to “ we ” , “ us ” , “ our ” or the “ company ” are to andina acquisition corporation , except where the context requires otherwise . the following discussion should be read in conjunction with our condensed financial statements and related notes thereto included elsewhere in this report . overview we are a blank check company in the development stage , formed on september 21 , 2011 to serve as a vehicle to effect a merger , share exchange , asset acquisition , share purchase , recapitalization , reorganization or other similar business combination with a target business . our efforts to identify a prospective target business will not be limited to a particular industry or geographic location although we intend to focus our search for target businesses in the andean region of south america and in central america , with a particular emphasis on colombia . we are actively searching for a target business . 15 we presently have no revenue , have had losses since inception from incurring formation costs and have no other operations other than the active solicitation of a target business with which to complete a business combination . we have relied upon the sale of our securities and loans from our officers and directors to fund our operations . the registration statement for our initial public offering was declared effective on march 16 , 2012. we consummated the offering on march 22 , 2012 , and received proceeds net of transaction costs of $ 38,322,973 and $ 2,400,000 from the sale of warrants to certain of our initial shareholders and our u.s. counsel and $ 500,000 from the sale of a unit purchase option to earlybirdcapital , inc. ( “ ebc ” ) , the representative of the underwriters in the offering . on march 30 , 2012 , the underwriters exercised a portion of their over-allotment option and on march 30 , 2012 we received an additional $ 1,940,000 net of transaction costs . our management has broad discretion with respect to the specific application of the net proceeds of the offering , insider warrants and unit purchase option , although substantially all of the net proceeds are intended to be generally applied toward consummating a business combination with one or more businesses or entities . results of operations our entire activity since inception up to the closing of our initial public offering story_separator_special_tag the holders of a majority of the private placement warrants ( or underlying securities ) can elect to exercise these registration rights at any time after we consummate a business combination . in addition , the holders have certain “ piggy-back ” registration rights with respect to registration statements filed subsequent to our consummation of a business combination . we will bear the expenses incurred in connection with the filing of any such registration statements . 30 the holders of the first purchase option are entitled to registration rights . the holders of a majority of the first purchase option and the securities underlying such option are entitled to make one demand that we register the options and or the securities underlying the first purchase option . the demand for registration may be made at any time until march 16 , 2017. in addition , the holders have certain “ piggy-back ” registration rights with respect to registration statements filed prior to march 16 , 2019. we will bear the expenses incurred in connection with the filing of any such registration statements , other than any underwriting commissions which will be paid by the holders themselves . the holders of the second purchase option will be entitled to registration rights . the holders of a majority of the second purchase option and the securities underlying such option are entitled to make one demand that we register the options and or the securities underlying the second purchase option . the demand for registration may be made at any time until march 16 , 2017. in addition , the holders have certain “ piggy-back ” registration rights with respect to registration statements filed during the seven year period commencing on the effective date of the registration statement of which this prospectus forms a part . we will bear the expenses incurred in connection with the filing of any such registration statements , other than any underwriting commissions which will be paid by the holders themselves . prior to our ipo , a. lorne weil advanced to us an aggregate of $ 100,000 to cover expenses related to the offering . the loan was payable without interest on the earlier of ( i ) november 8 , 2012 , ( ii story_separator_special_tag forward-looking statements this annual report on form 10-k includes forward-looking statements within the meaning of section 27a of the securities act of 1933 , as amended , and section 21e of the securities exchange act of 1934 , as amended ( the “ exchange act ” ) . we have based these forward-looking statements on our current expectations and projections about future events . these forward-looking statements are subject to known and unknown risks , uncertainties and assumptions about us that may cause our actual results , levels of activity , performance or achievements to be materially different from any future results , levels of activity , performance or achievements expressed or implied by such forward-looking statements . in some cases , you can identify forward-looking statements by terminology such as “ may , ” “ should , ” “ could , ” “ would , ” “ expect , ” “ plan , ” “ anticipate , ” “ believe , ” “ estimate , ” “ continue , ” or the negative of such terms or other similar expressions . factors that might cause or contribute to such a discrepancy include , but are not limited to , those described in our other securities and exchange commission ( “ sec ” ) filings . references to “ we ” , “ us ” , “ our ” or the “ company ” are to andina acquisition corporation , except where the context requires otherwise . the following discussion should be read in conjunction with our condensed financial statements and related notes thereto included elsewhere in this report . overview we are a blank check company in the development stage , formed on september 21 , 2011 to serve as a vehicle to effect a merger , share exchange , asset acquisition , share purchase , recapitalization , reorganization or other similar business combination with a target business . our efforts to identify a prospective target business will not be limited to a particular industry or geographic location although we intend to focus our search for target businesses in the andean region of south america and in central america , with a particular emphasis on colombia . we are actively searching for a target business . 15 we presently have no revenue , have had losses since inception from incurring formation costs and have no other operations other than the active solicitation of a target business with which to complete a business combination . we have relied upon the sale of our securities and loans from our officers and directors to fund our operations . the registration statement for our initial public offering was declared effective on march 16 , 2012. we consummated the offering on march 22 , 2012 , and received proceeds net of transaction costs of $ 38,322,973 and $ 2,400,000 from the sale of warrants to certain of our initial shareholders and our u.s. counsel and $ 500,000 from the sale of a unit purchase option to earlybirdcapital , inc. ( “ ebc ” ) , the representative of the underwriters in the offering . on march 30 , 2012 , the underwriters exercised a portion of their over-allotment option and on march 30 , 2012 we received an additional $ 1,940,000 net of transaction costs . our management has broad discretion with respect to the specific application of the net proceeds of the offering , insider warrants and unit purchase option , although substantially all of the net proceeds are intended to be generally applied toward consummating a business combination with one or more businesses or entities . results of operations our entire activity since inception up to the closing of our initial public offering

liquidity and capital resources as of february 28 , 2013 , we had $ 48,959 in our operating bank account . we had $ 42,767,991 in restricted cash and equivalents held in trust to be used for a business combination . we intend to use the proceeds not held in the trust account plus the interest earned on the funds held in the trust account that may be released to us to fund our working capital requirements . as of february 28 , 2013 , u.s treasury bills with one month and three month maturities were yielding approximately .07 % and .11 % , respectively . while we may invest in other securities , we believe such rates are representative of those we may receive on the balance of the trust account . 16 until consummation of our initial business combination , we will be using the funds not held in the trust account for identifying and evaluating prospective acquisition candidates , performing business due diligence on prospective target businesses , traveling to and from the offices , plants or similar locations of prospective target businesses , reviewing corporate documents and material agreements of prospective target businesses , selecting the target business to acquire and structuring , negotiating and consummating the business combination . our estimates are based upon the belief that in-depth due diligence will be undertaken only after we have negotiated and signed a letter of intent or other preliminary agreement that addresses the terms of a business combination . our actual costs may be higher or lower than these estimates .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```liquidity and capital resources as of february 28 , 2013 , we had $ 48,959 in our operating bank account . we had $ 42,767,991 in restricted cash and equivalents held in trust to be used for a business combination . we intend to use the proceeds not held in the trust account plus the interest earned on the funds held in the trust account that may be released to us to fund our working capital requirements . as of february 28 , 2013 , u.s treasury bills with one month and three month maturities were yielding approximately .07 % and .11 % , respectively . while we may invest in other securities , we believe such rates are representative of those we may receive on the balance of the trust account . 16 until consummation of our initial business combination , we will be using the funds not held in the trust account for identifying and evaluating prospective acquisition candidates , performing business due diligence on prospective target businesses , traveling to and from the offices , plants or similar locations of prospective target businesses , reviewing corporate documents and material agreements of prospective target businesses , selecting the target business to acquire and structuring , negotiating and consummating the business combination . our estimates are based upon the belief that in-depth due diligence will be undertaken only after we have negotiated and signed a letter of intent or other preliminary agreement that addresses the terms of a business combination . our actual costs may be higher or lower than these estimates . ``` Suspicious Activity Report : the holders of a majority of the private placement warrants ( or underlying securities ) can elect to exercise these registration rights at any time after we consummate a business combination . in addition , the holders have certain “ piggy-back ” registration rights with respect to registration statements filed subsequent to our consummation of a business combination . we will bear the expenses incurred in connection with the filing of any such registration statements . 30 the holders of the first purchase option are entitled to registration rights . the holders of a majority of the first purchase option and the securities underlying such option are entitled to make one demand that we register the options and or the securities underlying the first purchase option . the demand for registration may be made at any time until march 16 , 2017. in addition , the holders have certain “ piggy-back ” registration rights with respect to registration statements filed prior to march 16 , 2019. we will bear the expenses incurred in connection with the filing of any such registration statements , other than any underwriting commissions which will be paid by the holders themselves . the holders of the second purchase option will be entitled to registration rights . the holders of a majority of the second purchase option and the securities underlying such option are entitled to make one demand that we register the options and or the securities underlying the second purchase option . the demand for registration may be made at any time until march 16 , 2017. in addition , the holders have certain “ piggy-back ” registration rights with respect to registration statements filed during the seven year period commencing on the effective date of the registration statement of which this prospectus forms a part . we will bear the expenses incurred in connection with the filing of any such registration statements , other than any underwriting commissions which will be paid by the holders themselves . prior to our ipo , a. lorne weil advanced to us an aggregate of $ 100,000 to cover expenses related to the offering . the loan was payable without interest on the earlier of ( i ) november 8 , 2012 , ( ii story_separator_special_tag forward-looking statements this annual report on form 10-k includes forward-looking statements within the meaning of section 27a of the securities act of 1933 , as amended , and section 21e of the securities exchange act of 1934 , as amended ( the “ exchange act ” ) . we have based these forward-looking statements on our current expectations and projections about future events . these forward-looking statements are subject to known and unknown risks , uncertainties and assumptions about us that may cause our actual results , levels of activity , performance or achievements to be materially different from any future results , levels of activity , performance or achievements expressed or implied by such forward-looking statements . in some cases , you can identify forward-looking statements by terminology such as “ may , ” “ should , ” “ could , ” “ would , ” “ expect , ” “ plan , ” “ anticipate , ” “ believe , ” “ estimate , ” “ continue , ” or the negative of such terms or other similar expressions . factors that might cause or contribute to such a discrepancy include , but are not limited to , those described in our other securities and exchange commission ( “ sec ” ) filings . references to “ we ” , “ us ” , “ our ” or the “ company ” are to andina acquisition corporation , except where the context requires otherwise . the following discussion should be read in conjunction with our condensed financial statements and related notes thereto included elsewhere in this report . overview we are a blank check company in the development stage , formed on september 21 , 2011 to serve as a vehicle to effect a merger , share exchange , asset acquisition , share purchase , recapitalization , reorganization or other similar business combination with a target business . our efforts to identify a prospective target business will not be limited to a particular industry or geographic location although we intend to focus our search for target businesses in the andean region of south america and in central america , with a particular emphasis on colombia . we are actively searching for a target business . 15 we presently have no revenue , have had losses since inception from incurring formation costs and have no other operations other than the active solicitation of a target business with which to complete a business combination . we have relied upon the sale of our securities and loans from our officers and directors to fund our operations . the registration statement for our initial public offering was declared effective on march 16 , 2012. we consummated the offering on march 22 , 2012 , and received proceeds net of transaction costs of $ 38,322,973 and $ 2,400,000 from the sale of warrants to certain of our initial shareholders and our u.s. counsel and $ 500,000 from the sale of a unit purchase option to earlybirdcapital , inc. ( “ ebc ” ) , the representative of the underwriters in the offering . on march 30 , 2012 , the underwriters exercised a portion of their over-allotment option and on march 30 , 2012 we received an additional $ 1,940,000 net of transaction costs . our management has broad discretion with respect to the specific application of the net proceeds of the offering , insider warrants and unit purchase option , although substantially all of the net proceeds are intended to be generally applied toward consummating a business combination with one or more businesses or entities . results of operations our entire activity since inception up to the closing of our initial public offering story_separator_special_tag the holders of a majority of the private placement warrants ( or underlying securities ) can elect to exercise these registration rights at any time after we consummate a business combination . in addition , the holders have certain “ piggy-back ” registration rights with respect to registration statements filed subsequent to our consummation of a business combination . we will bear the expenses incurred in connection with the filing of any such registration statements . 30 the holders of the first purchase option are entitled to registration rights . the holders of a majority of the first purchase option and the securities underlying such option are entitled to make one demand that we register the options and or the securities underlying the first purchase option . the demand for registration may be made at any time until march 16 , 2017. in addition , the holders have certain “ piggy-back ” registration rights with respect to registration statements filed prior to march 16 , 2019. we will bear the expenses incurred in connection with the filing of any such registration statements , other than any underwriting commissions which will be paid by the holders themselves . the holders of the second purchase option will be entitled to registration rights . the holders of a majority of the second purchase option and the securities underlying such option are entitled to make one demand that we register the options and or the securities underlying the second purchase option . the demand for registration may be made at any time until march 16 , 2017. in addition , the holders have certain “ piggy-back ” registration rights with respect to registration statements filed during the seven year period commencing on the effective date of the registration statement of which this prospectus forms a part . we will bear the expenses incurred in connection with the filing of any such registration statements , other than any underwriting commissions which will be paid by the holders themselves . prior to our ipo , a. lorne weil advanced to us an aggregate of $ 100,000 to cover expenses related to the offering . the loan was payable without interest on the earlier of ( i ) november 8 , 2012 , ( ii story_separator_special_tag forward-looking statements this annual report on form 10-k includes forward-looking statements within the meaning of section 27a of the securities act of 1933 , as amended , and section 21e of the securities exchange act of 1934 , as amended ( the “ exchange act ” ) . we have based these forward-looking statements on our current expectations and projections about future events . these forward-looking statements are subject to known and unknown risks , uncertainties and assumptions about us that may cause our actual results , levels of activity , performance or achievements to be materially different from any future results , levels of activity , performance or achievements expressed or implied by such forward-looking statements . in some cases , you can identify forward-looking statements by terminology such as “ may , ” “ should , ” “ could , ” “ would , ” “ expect , ” “ plan , ” “ anticipate , ” “ believe , ” “ estimate , ” “ continue , ” or the negative of such terms or other similar expressions . factors that might cause or contribute to such a discrepancy include , but are not limited to , those described in our other securities and exchange commission ( “ sec ” ) filings . references to “ we ” , “ us ” , “ our ” or the “ company ” are to andina acquisition corporation , except where the context requires otherwise . the following discussion should be read in conjunction with our condensed financial statements and related notes thereto included elsewhere in this report . overview we are a blank check company in the development stage , formed on september 21 , 2011 to serve as a vehicle to effect a merger , share exchange , asset acquisition , share purchase , recapitalization , reorganization or other similar business combination with a target business . our efforts to identify a prospective target business will not be limited to a particular industry or geographic location although we intend to focus our search for target businesses in the andean region of south america and in central america , with a particular emphasis on colombia . we are actively searching for a target business . 15 we presently have no revenue , have had losses since inception from incurring formation costs and have no other operations other than the active solicitation of a target business with which to complete a business combination . we have relied upon the sale of our securities and loans from our officers and directors to fund our operations . the registration statement for our initial public offering was declared effective on march 16 , 2012. we consummated the offering on march 22 , 2012 , and received proceeds net of transaction costs of $ 38,322,973 and $ 2,400,000 from the sale of warrants to certain of our initial shareholders and our u.s. counsel and $ 500,000 from the sale of a unit purchase option to earlybirdcapital , inc. ( “ ebc ” ) , the representative of the underwriters in the offering . on march 30 , 2012 , the underwriters exercised a portion of their over-allotment option and on march 30 , 2012 we received an additional $ 1,940,000 net of transaction costs . our management has broad discretion with respect to the specific application of the net proceeds of the offering , insider warrants and unit purchase option , although substantially all of the net proceeds are intended to be generally applied toward consummating a business combination with one or more businesses or entities . results of operations our entire activity since inception up to the closing of our initial public offering

in response to these budgetary pressures , schools typically elect to retain teachers and spend less on repairs , maintenance and replacement furniture , which in turn reduces the demand for , and sales of , the company 's products . in recent years there has been an improvement in state and local tax collections , and most state and local governments have seen their tax receipts return to the pre-2008 levels . in response to the 2008 recession , passage of new bond issuances declined , and the related bond funded project completions decreased materially for several years . in recent years the completions of bond funded projects have recovered from the low point subsequent to 2008 , but projects remain well below the pre-2008 levels . in the recent elections we observed an increase in bond passages . due to the time requirement to plan and construct a new school or major remodel , there is a time lag frequently ranging from one to three years between bond passage and when the bond funding translates into furniture sales . sales of product for completions of new schools , additions and renovations improved in the year ended january 31 , 2019 , and is anticipated to be favorable for the year ending january 31 , 2020 ( `` fiscal 2020 `` ) . while the current operating environment continues to show moderate year-over-year improvement , under-funding of our education system continues to be an on-going concern . a 2016 report from the national council on school facilities estimates that on every school day , approximately 50 million students and six million adults use publicly funded k-12 facilities . for state and local governments , spending on these facilities is the largest capital expenditure outside of highways . it was estimated that public schools spend approximately $ 99 billion per year on maintenance , operations and capital spending . the study estimates that a desirable level of spending would be $ 145 billion , leaving an annual shortfall of $ 46 billion . the significant budgetary challenges faced by the education industry have had an impact on the company 's business model over this time frame and have created opportunities as well . in the 1990 's , the company 's primary customers were the school business officials at a school district , and deliveries of furniture typically were to a district warehouse . in response to their budgetary challenges , many school districts closed warehouses and reduced janitorial and support staff in order to retain 22 accredited teachers . selling efforts must now reach school principals and administrative staff in addition to the district business offices . sales priced under national contracts or buying groups are displacing competitive bids administered by professional purchasing departments . distribution has become a more meaningful component of our business as most deliveries are to school sites , and often include inside delivery to the classroom . this evolution adds to the seasonal challenges of our business , but also creates opportunities to suppliers that can execute during the short summer delivery window . the furniture industry in general , including the market for school furniture , has been significantly impacted by low cost competition from manufacturers based in china . competition from china increased dramatically after admission of china to the world trade organization in 2001. subsequent to this date , many of our domestic manufacturing competitors closed their factories and sourced product from china . to our knowledge , no new factories or significant manufacturing enhancements were constructed to support the school furniture market during this period . virco pursued a different strategy which exacerbated operating challenges following these events , but now leave us with what we believe to be a significant competitive advantage . during a period of robust education spending during the 1990 's , the company expanded and modernized its manufacturing and distribution facilities at the torrance , ca and conway , ar locations . during the last fifteen years , the company has worked continuously to significantly reduce and control its cost structure while concurrently expanding its product offering , expanding manufacturing process capabilities and more fully automating its facilities . for example , headcount of permanent employees as of january 31 , 2019 , was approximately 840 compared to a peak of nearly 2,950 in august 2000. factory overhead in fiscal 2019 declined by more than 50 % compared to fiscal 2001. the company accomplished this without closing a factory and while continuing to add new production processes , including flat metal forming , and other capabilities to support its ambitious product development program . our domestic fabrication allowed the company to develop significant product variety , color choices and custom products that are very difficult to replicate with a supply chain extending to china . finally , many education furniture products are bulky , with a large cube relative to the selling price . the cost of ocean freight from overseas for these bulky items offsets the cost advantages for overseas production . the company 's operating results can be impacted significantly by cost and volatility of commodities , especially steel , plastic , wood and energy . because a majority of the company 's sales are generated under annual contracts in which the company has limited ability to raise the price of its products during the term of the contract , if the costs of the company 's raw materials increase suddenly or unexpectedly , the company can not be certain that it will be able to implement corresponding increases in its sales prices in order to offset such increased costs . the company moderates this exposure by building significant quantities of finished goods and component parts during the first and second quarters . story_separator_special_tag in 2017 , congress passed the tax cuts and jobs act ( tcja ) on december 22 , 2017 which , among other changes , reduced the federal income tax rate effective january 1 , 2018 to 21 % . because virco 's fiscal year ended january 31 , 2018 , 11 of the 12 months were subject to the 34 % graduated rate and one month at the 21 % rate , for an effective federal rate of 32.9 % . as a result of the reduction in the federal tax rate , the value of the company 's deferred tax assets decreased by $ 4,438,000 as of january 31 , 2018. it is expected the effective tax rate for fiscal 2020 will be approximately 27 % . inflation and future change in prices we commit to annual contracts that determine selling prices for goods and services for periods of one year and occasionally longer . though the company has negotiated flexibility under many of these contracts that may allow the company to increase prices on future orders , the company does not have the ability to raise prices on orders received prior to any announced price increase . due to the intensely seasonal nature of our business , the company may receive significant orders during the first and second quarters for delivery in the second and third quarters . with respect to any of the contracts described above , if the costs of providing our products or services increase between the date the orders are received and the shipping date , we may not be able to implement corresponding increases in our sales prices for such products or services to offset the related increased costs . in fiscal 2017 , the cost of steel increased significantly , but the increase did not occur until after the company had sourced the majority of its steel for the summer delivery season . in fiscal 2018 , the cost of commodities increased over the course of the year but did not spike as suddenly as in some prior periods . in fiscal 2019 , the company incurred severe and sudden increase is material and component costs . in the first quarter , the federal government imposed a 25 % tariff on imported steel . the company purchases the majority of its steel from domestic sources , but the cost of domestic steel increased concurrently with the effective date of the tariffs on foreign steel . during the summer , the cost of imported components increased by as much as 15 % , primarily due to increased costs incurred by chinese suppliers . in october , a 10 % tariff was imposed on chinese furniture and components . 26 for fiscal 2020 , the company anticipates continued volatility in costs , particularly with respect to certain raw materials , transportation , and energy . anticipated adverse volatility for fiscal 2020 could be severe in light of tariffs imposed or threatened on imported commodities . there is continued uncertainty with respect to steel and other raw material costs , including plastics , that are affected by the price of oil . transportation costs may be adversely affected by increased oil prices , in the form of increased operation costs for our fleet , and surcharges on freight paid to third-party carriers . virco depends upon third party carriers for more than 90 % of customer deliveries . subsequent to 2010 , many carriers went out of business or were required to reduce the size of their fleets due to economic conditions and have not increased their fleets as the economy has improved . recent regulation and more stringent enforcement of federal regulations governing the transportation industry ( especially regarding drivers ) have adversely impacted the cost and availability of freight services . virco expects to incur continued pressure on employee benefit costs . the company has renewed health insurance contracts for its employees through december 2019 but costs after that date may be adversely impacted by current legislation , claim costs and industry consolidation . virco has aggressively addressed these costs by controlling headcount , freezing pension benefits and passing on a portion of increased medical costs to employees . to recover the cumulative impact of increased costs , the company has increased published list prices for fiscal 2020. due to current economic conditions , the company anticipates continued significant price competition in fiscal 2020 and may not be able to raise prices without risk of losing market share . as a significant portion of virco 's business is obtained through competitive bids , the company is carefully considering material and transportation costs as part of the bidding process . total material costs for fiscal 2020 , as a percentage of sales , could be higher than in fiscal 2019. the company is working to control and reduce costs by improving production and distribution methodologies , investigating new packaging and shipping materials and searching for new sources of purchased components and raw materials . story_separator_special_tag 1.75 % to 2.25 % , in each case based on the ebitda of the borrowers at the end of each fiscal quarter and may be increased at pnc 's option by 2.0 % during the continuance of an event of default . accrued interest with respect to principal amounts outstanding under the credit agreement is payable in arrears on a monthly basis for alternative base rate loans , and at the end of the applicable interest period but at most every three months for eurodollar currency rate loans . the interest rate at january 31 , 2019 was 6.25 % . for the fiscal year ended january 31 , 2016 , the credit agreement contained a covenant that forbade the company from issuing dividends or making payments with respect to the company 's capital stock . on april 4 , 2016 the company entered into an amendment allowing the company to pay dividends or conduct stock repurchases

liquidity and capital resources working capital requirements virco addresses liquidity and working capital requirements in the context of short-term seasonal requirements and long-term capital requirements of the business . the company 's core business of selling furniture to publicly funded educational institutions is extremely seasonal . the seasonal nature of this business permeates most of virco 's operational , capital and financing decisions . the company 's working capital requirements during and in anticipation of the peak summer season oblige management to make estimates and judgments that affect virco 's assets , liabilities , revenues and expenses . management expends a significant amount of time during the year , and especially in the fourth quarter of the prior year and first quarter , developing a stocking plan and estimating the number of employees , the amount of raw materials and the types of components and products that will be required during the peak season . if management underestimates any of these requirements , virco 's ability to fill customer orders on a timely basis or to provide adequate customer service may be diminished . if management overestimates any of these requirements , the company may be required to absorb higher storage , labor and related costs , each of which may affect profitability . on an ongoing basis , management evaluates such estimates , including those related to market demand , labor costs and inventory levels , and continually strives to improve virco 's ability to correctly forecast business requirements during the peak season each year . as part of virco 's efforts to address seasonality , financial performance and quality without sacrificing service or market share , management has been refining the company 's ats operating model . ats is virco 's version of mass-customization , which assembles standard , stocked components into customized configurations before shipment . the company 's ats program reduces the total amount of inventory and working capital needed to support a given level of sales . it does this by increasing the inventory 's versatility , delaying assembly until the last moment and reducing the amount of warehouse space needed to store finished goods .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```liquidity and capital resources working capital requirements virco addresses liquidity and working capital requirements in the context of short-term seasonal requirements and long-term capital requirements of the business . the company 's core business of selling furniture to publicly funded educational institutions is extremely seasonal . the seasonal nature of this business permeates most of virco 's operational , capital and financing decisions . the company 's working capital requirements during and in anticipation of the peak summer season oblige management to make estimates and judgments that affect virco 's assets , liabilities , revenues and expenses . management expends a significant amount of time during the year , and especially in the fourth quarter of the prior year and first quarter , developing a stocking plan and estimating the number of employees , the amount of raw materials and the types of components and products that will be required during the peak season . if management underestimates any of these requirements , virco 's ability to fill customer orders on a timely basis or to provide adequate customer service may be diminished . if management overestimates any of these requirements , the company may be required to absorb higher storage , labor and related costs , each of which may affect profitability . on an ongoing basis , management evaluates such estimates , including those related to market demand , labor costs and inventory levels , and continually strives to improve virco 's ability to correctly forecast business requirements during the peak season each year . as part of virco 's efforts to address seasonality , financial performance and quality without sacrificing service or market share , management has been refining the company 's ats operating model . ats is virco 's version of mass-customization , which assembles standard , stocked components into customized configurations before shipment . the company 's ats program reduces the total amount of inventory and working capital needed to support a given level of sales . it does this by increasing the inventory 's versatility , delaying assembly until the last moment and reducing the amount of warehouse space needed to store finished goods . ``` Suspicious Activity Report : in response to these budgetary pressures , schools typically elect to retain teachers and spend less on repairs , maintenance and replacement furniture , which in turn reduces the demand for , and sales of , the company 's products . in recent years there has been an improvement in state and local tax collections , and most state and local governments have seen their tax receipts return to the pre-2008 levels . in response to the 2008 recession , passage of new bond issuances declined , and the related bond funded project completions decreased materially for several years . in recent years the completions of bond funded projects have recovered from the low point subsequent to 2008 , but projects remain well below the pre-2008 levels . in the recent elections we observed an increase in bond passages . due to the time requirement to plan and construct a new school or major remodel , there is a time lag frequently ranging from one to three years between bond passage and when the bond funding translates into furniture sales . sales of product for completions of new schools , additions and renovations improved in the year ended january 31 , 2019 , and is anticipated to be favorable for the year ending january 31 , 2020 ( `` fiscal 2020 `` ) . while the current operating environment continues to show moderate year-over-year improvement , under-funding of our education system continues to be an on-going concern . a 2016 report from the national council on school facilities estimates that on every school day , approximately 50 million students and six million adults use publicly funded k-12 facilities . for state and local governments , spending on these facilities is the largest capital expenditure outside of highways . it was estimated that public schools spend approximately $ 99 billion per year on maintenance , operations and capital spending . the study estimates that a desirable level of spending would be $ 145 billion , leaving an annual shortfall of $ 46 billion . the significant budgetary challenges faced by the education industry have had an impact on the company 's business model over this time frame and have created opportunities as well . in the 1990 's , the company 's primary customers were the school business officials at a school district , and deliveries of furniture typically were to a district warehouse . in response to their budgetary challenges , many school districts closed warehouses and reduced janitorial and support staff in order to retain 22 accredited teachers . selling efforts must now reach school principals and administrative staff in addition to the district business offices . sales priced under national contracts or buying groups are displacing competitive bids administered by professional purchasing departments . distribution has become a more meaningful component of our business as most deliveries are to school sites , and often include inside delivery to the classroom . this evolution adds to the seasonal challenges of our business , but also creates opportunities to suppliers that can execute during the short summer delivery window . the furniture industry in general , including the market for school furniture , has been significantly impacted by low cost competition from manufacturers based in china . competition from china increased dramatically after admission of china to the world trade organization in 2001. subsequent to this date , many of our domestic manufacturing competitors closed their factories and sourced product from china . to our knowledge , no new factories or significant manufacturing enhancements were constructed to support the school furniture market during this period . virco pursued a different strategy which exacerbated operating challenges following these events , but now leave us with what we believe to be a significant competitive advantage . during a period of robust education spending during the 1990 's , the company expanded and modernized its manufacturing and distribution facilities at the torrance , ca and conway , ar locations . during the last fifteen years , the company has worked continuously to significantly reduce and control its cost structure while concurrently expanding its product offering , expanding manufacturing process capabilities and more fully automating its facilities . for example , headcount of permanent employees as of january 31 , 2019 , was approximately 840 compared to a peak of nearly 2,950 in august 2000. factory overhead in fiscal 2019 declined by more than 50 % compared to fiscal 2001. the company accomplished this without closing a factory and while continuing to add new production processes , including flat metal forming , and other capabilities to support its ambitious product development program . our domestic fabrication allowed the company to develop significant product variety , color choices and custom products that are very difficult to replicate with a supply chain extending to china . finally , many education furniture products are bulky , with a large cube relative to the selling price . the cost of ocean freight from overseas for these bulky items offsets the cost advantages for overseas production . the company 's operating results can be impacted significantly by cost and volatility of commodities , especially steel , plastic , wood and energy . because a majority of the company 's sales are generated under annual contracts in which the company has limited ability to raise the price of its products during the term of the contract , if the costs of the company 's raw materials increase suddenly or unexpectedly , the company can not be certain that it will be able to implement corresponding increases in its sales prices in order to offset such increased costs . the company moderates this exposure by building significant quantities of finished goods and component parts during the first and second quarters . story_separator_special_tag in 2017 , congress passed the tax cuts and jobs act ( tcja ) on december 22 , 2017 which , among other changes , reduced the federal income tax rate effective january 1 , 2018 to 21 % . because virco 's fiscal year ended january 31 , 2018 , 11 of the 12 months were subject to the 34 % graduated rate and one month at the 21 % rate , for an effective federal rate of 32.9 % . as a result of the reduction in the federal tax rate , the value of the company 's deferred tax assets decreased by $ 4,438,000 as of january 31 , 2018. it is expected the effective tax rate for fiscal 2020 will be approximately 27 % . inflation and future change in prices we commit to annual contracts that determine selling prices for goods and services for periods of one year and occasionally longer . though the company has negotiated flexibility under many of these contracts that may allow the company to increase prices on future orders , the company does not have the ability to raise prices on orders received prior to any announced price increase . due to the intensely seasonal nature of our business , the company may receive significant orders during the first and second quarters for delivery in the second and third quarters . with respect to any of the contracts described above , if the costs of providing our products or services increase between the date the orders are received and the shipping date , we may not be able to implement corresponding increases in our sales prices for such products or services to offset the related increased costs . in fiscal 2017 , the cost of steel increased significantly , but the increase did not occur until after the company had sourced the majority of its steel for the summer delivery season . in fiscal 2018 , the cost of commodities increased over the course of the year but did not spike as suddenly as in some prior periods . in fiscal 2019 , the company incurred severe and sudden increase is material and component costs . in the first quarter , the federal government imposed a 25 % tariff on imported steel . the company purchases the majority of its steel from domestic sources , but the cost of domestic steel increased concurrently with the effective date of the tariffs on foreign steel . during the summer , the cost of imported components increased by as much as 15 % , primarily due to increased costs incurred by chinese suppliers . in october , a 10 % tariff was imposed on chinese furniture and components . 26 for fiscal 2020 , the company anticipates continued volatility in costs , particularly with respect to certain raw materials , transportation , and energy . anticipated adverse volatility for fiscal 2020 could be severe in light of tariffs imposed or threatened on imported commodities . there is continued uncertainty with respect to steel and other raw material costs , including plastics , that are affected by the price of oil . transportation costs may be adversely affected by increased oil prices , in the form of increased operation costs for our fleet , and surcharges on freight paid to third-party carriers . virco depends upon third party carriers for more than 90 % of customer deliveries . subsequent to 2010 , many carriers went out of business or were required to reduce the size of their fleets due to economic conditions and have not increased their fleets as the economy has improved . recent regulation and more stringent enforcement of federal regulations governing the transportation industry ( especially regarding drivers ) have adversely impacted the cost and availability of freight services . virco expects to incur continued pressure on employee benefit costs . the company has renewed health insurance contracts for its employees through december 2019 but costs after that date may be adversely impacted by current legislation , claim costs and industry consolidation . virco has aggressively addressed these costs by controlling headcount , freezing pension benefits and passing on a portion of increased medical costs to employees . to recover the cumulative impact of increased costs , the company has increased published list prices for fiscal 2020. due to current economic conditions , the company anticipates continued significant price competition in fiscal 2020 and may not be able to raise prices without risk of losing market share . as a significant portion of virco 's business is obtained through competitive bids , the company is carefully considering material and transportation costs as part of the bidding process . total material costs for fiscal 2020 , as a percentage of sales , could be higher than in fiscal 2019. the company is working to control and reduce costs by improving production and distribution methodologies , investigating new packaging and shipping materials and searching for new sources of purchased components and raw materials . story_separator_special_tag 1.75 % to 2.25 % , in each case based on the ebitda of the borrowers at the end of each fiscal quarter and may be increased at pnc 's option by 2.0 % during the continuance of an event of default . accrued interest with respect to principal amounts outstanding under the credit agreement is payable in arrears on a monthly basis for alternative base rate loans , and at the end of the applicable interest period but at most every three months for eurodollar currency rate loans . the interest rate at january 31 , 2019 was 6.25 % . for the fiscal year ended january 31 , 2016 , the credit agreement contained a covenant that forbade the company from issuing dividends or making payments with respect to the company 's capital stock . on april 4 , 2016 the company entered into an amendment allowing the company to pay dividends or conduct stock repurchases

the results of our operations during the year ended december 31 , 2016 include the operations of shippingeasy for the period from july 1 , 2016 through december 31 , 2016. the results of our operations during 36 the years ended december 31 , 2017 and 2016 include the operations of endicia . the results of our operations during the year ended december 31 , 2015 include the operations of endicia for the period from november 18 , 2015 through december 31 , 2015. please see note 3 – “acquisitions” in our notes to consolidated financial statements for further description . accordingly , care should be used in comparing periods that include the operations of shippingeasy with those that do not include such operations . years ended december 31 , 2017 and 2016 total revenue increased 29 % to $ 468.7 million in 2017 from $ 364.3 million in 2016. mailing and shipping revenue , which includes service revenue , product revenue and insurance revenue , was $ 449.4 million in 2017 , an increase of 28 % from $ 350.6 million in 2016. customized postage revenue increased 41 % to $ 19.2 million in 2017 from $ 13.6 million in 2016. the following table sets forth the breakdown of revenue for 2017 and 2016 and the resulting percent change ( revenue in thousands ) : replace_table_token_5_th we define “paid customers” for the quarter as ones from whom we successfully collected service fees or otherwise earned revenue at least once during that quarter , and we define arpu as mailing and shipping revenue divided by paid customers . we define lost paid customers ( lost paid customers ) as customers from whom we successfully collected service fees or otherwise earned revenue at least once during the previous quarter but not during the current quarter , less recaptured paid customers . we define monthly paid customer cancellation rate ( monthly churn ) as a fraction , the numerator of which is the quotient of lost paid customers in a quarter divided by the sum of paid customers in the prior quarter and new paid customers in the current quarter , and the denominator of which is three months . the following table sets forth the number of paid customers in the period for our mailing and shipping business ( in thousands ) : replace_table_token_6_th the following table sets forth the growth in paid customers and arpu for our mailing and shipping business ( in thousands except arpu and percentage ) : replace_table_token_7_th the increase in paid customers is primarily the result of increased sales and marketing spend and better performance in our marketing programs . the increase in our arpu was primarily the result of the growth in our shipping business where we have the ability to better monetize postage volume as compared to monthly flat rate subscription fees . 37 revenue by product the following table shows our components of revenue and their respective percentages of total revenue for the periods indicated ( in thousands except percentage ) : replace_table_token_8_th our revenue is derived primarily from five sources : ( 1 ) service and transaction related revenues from our usps mailing and shipping services , our multi-carrier shipping services and our mailing and shipping integrations ; ( 2 ) product revenue from the direct sale of consumables and supplies through our supplies stores ; ( 3 ) package insurance revenue from our branded insurance offerings ; ( 4 ) customized postage revenue from the sale of photostamps and pictureitpostage postage labels ; and ( 5 ) other revenue , consisting of advertising revenue derived from advertising programs with our existing customers . we earn service revenue in several different ways : ( 1 ) customers may pay us a monthly fee based on a subscription plan which may be waived or refunded for certain customers ; ( 2 ) we may be compensated directly by the usps for certain qualifying customers under our usps partnership ; ( 3 ) we may earn transaction related revenue based on customers purchasing postage or printing shipping labels ; ( 4 ) we may earn compensation by offering customers a discounted postage rate that is provided to the customers by our integration partners ; and ( 5 ) we may earn other types of revenue shares or other compensation from specific customers or integration partners . service revenue increased 31 % to $ 411.3 million in 2017 from $ 313.1 million in 2016. the increase in service revenue consisted of a 12 % increase in our annual average paid customers and an 18 % increase in our average service revenue per paid customer ( service revenue arpu ) . the increase in the number of our paid customers was attributable to the factors described in the previous section . the increase in our service revenue arpu was attributable to ( 1 ) the factors that resulted in an increase in the average total mailing and shipping revenue per paid customer described in the previous section and ( 2 ) the renewal of two of our agreements with the usps with improved economics . product revenue increased 2 % to $ 20.7 million in 2017 from $ 20.2 million in 2016. product revenue is primarily driven by labels , such as netstamps and dymo stamps , which are used for mailing . however , our postage growth has been driven more by shipping than mailing over recent years . insurance revenue was $ 17.4 million in 2017 and $ 17.3 million in 2016. the growth in insurance revenue is less than the growth in service revenue primarily due to the increase in high volume shipper customers . high volume shipper customers often self-insure , so while the high volume shipping business results in higher service fee revenue , it may not result in higher insurance revenue . customized postage revenue increased 41 % to $ 19.2 million in 2017 from $ 13.6 million in 2016. story_separator_special_tag product revenue is primarily driven by labels , such as netstamps and dymo stamps , which are used for mailing . as our growth in postage has been driven more by shipping than mailing over the recent years , our growth in product revenue has been lower than our growth in total revenue . insurance revenue increased 47 % to $ 17.3 million in 2016 from $ 11.7 million in 2015. the increase in insurance revenue was primarily attributable to our acquisitions whose solutions target shipping customers who are more likely than mailing customers to purchase insurance . customized postage revenue increased 88 % to $ 13.6 million in 2016 from $ 7.2 million in 2015. the increase was primarily attributable to ( 1 ) an increase in photostamps high volume business orders , which increased by $ 2.9 million and ( 2 ) the addition of pictureitpostage as a result of our endicia acquisition , which added $ 4.1 million for the full year of 2016 as compared to the shorter period of 2015 for which endicia is included in our results . the increase in customized postage revenue was partially offset by a $ 0.6 million decrease in photostamps revenue from orders placed through the photostamps website . the decrease in revenue from website orders is primarily attributable to a reduction in our photostamps sales and marketing spending . cost of revenue the following table shows cost of revenues and cost of revenues as a percentage of associated revenue for the periods indicated ( in thousands except percentage ) : replace_table_token_15_th cost of service revenue principally consists of the cost of customer service , certain promotional expenses , system operating costs , credit card processing fees and customer misprints that do not qualify for reimbursement from the usps . cost of product revenue principally consists of the cost of products sold through our supplies stores and the related costs of shipping and handling . the cost of insurance revenue principally consists of parcel insurance offering costs through our third party insurance providers . cost of customized postage revenue principally consists of the face value of postage , customer service , image review costs , and printing and fulfillment costs . cost of service revenue increased 43 % to $ 40.0 million in 2016 from $ 28.0 million in 2015. the increase was primarily attributable to higher customer service costs , which increased by $ 6.0 million , to support our 44 growing customer base and higher credit card processing fees , which increased by $ 3.0 million , associated with our higher revenue . promotional expenses were not material in 2016. cost of service revenue as a percent of service revenue declined from 16 % in 2015 to 13 % in 2016. the decline was primarily attributable to achieving scale efficiencies in areas such as customer service from our growth in revenue . cost of product revenue increased 12 % to $ 6.7 million in 2016 from $ 6.0 million in 2015. the 12 % increase in cost of product revenue was primarily attributable to the increase in product revenue over the same time period . cost of product revenue as a percent of product revenue was 33 % in 2016 which was consistent with 2015. cost of insurance revenue increased 36 % to $ 5.4 million in 2016 from $ 4.0 million in 2015. the increase in cost of insurance revenue resulted from growth in the number of insurance transactions , which was primarily attributable to our acquisitions . cost of insurance revenue as a percent of insurance revenue declined from 34 % in 2015 to 31 % in 2016. the decline was primarily attributable to the insurance offerings of our acquired companies having higher prices for parcel insurance as compared to the rest of the company . cost of customized postage revenue increased 80 % to $ 10.8 million in 2016 from $ 6.0 million in 2015. the increase in cost of customized postage revenue is primarily due to the increase in our customized postage revenue . cost of customized postage revenue as a percent of customized postage revenue declined from 83 % in 2015 to 80 % in 2016. the decline was primarily the result of the addition of endicia 's pictureitpostage revenue which has a lower cost of customized postage revenue as a percent of customized postage revenue as compared to photostamps . pictureitpostage does not have a material level of high volume business orders which typically have a higher cost of customized postage revenue as a percent of customized postage revenue as compared to consumer website orders . operating expenses the following table outlines the components of our operating expense and their respective percentages of total revenues for the periods indicated ( in thousands except percentage ) : replace_table_token_16_th sales and marketing sales and marketing expense principally consists of spending to acquire new customers and compensation and related expenses for personnel engaged in sales , marketing , and business development activities . our sales and marketing programs include direct sales , customer referral programs , customer re-marketing efforts , direct mail , online advertising , partnerships , telemarketing , and traditional advertising . sales and marketing expense increased 40 % to $ 78.8 million in 2016 from $ 56.1 million in 2015. the increase is primarily due to ( 1 ) an increase in headcount-related expenses excluding stock-based compensation expense of $ 10.4 million , ( 2 ) an increase in stock-based compensation expense of $ 2.6 million and ( 3 ) an increase in discretionary marketing spend of $ 6.5 million . the increases in headcount-related and stock-based compensation expenses were due to both the addition of headcount resulting from our endicia and shippingeasy acquisitions as well as increased headcount in the rest of the company . 45 research and development research and development expense principally consists of compensation for personnel involved in the development of our services , depreciation of equipment

liquidity and capital resources as of december 31 , 2017 and 2016 , we had $ 153.9 million and $ 108.4 million , respectively , in cash , cash equivalents and short-term and long-term investments . we invest available funds in short-term and long-term securities , including money market funds , corporate bonds , and asset backed securities , and do not engage in hedging or speculative activities . net cash provided by operating activities was approximately $ 197.8 million in 2017 and $ 148.0 million in 2016. the increase in net cash provided by operating activities was primarily attributable to ( 1 ) an increase in net income of $ 75.4 million ; ( 2 ) the lack of a stock option windfall tax benefit , which was $ 26.8 million in 2016 ; ( 3 ) an increase in stock-based compensation expense of $ 6.9 million ; and ( 4 ) an increase in other liabilities of $ 5.3 million ; partially offset by ( a ) a decrease in deferred income tax balance of $ 25.8 million ; ( b ) an increase in current income taxes receivable of $ 22.3 million ; ( c ) an increase in accounts receivable of $ 11.5 million ; and ( d ) an increase in other assets of $ 6.6 million . net cash used in investing activities was approximately $ 5.3 million in 2017 and $ 55.2 million in 2016. the decrease in net cash used in investing activities was primarily due to the prior period acquisition of shippingeasy on july 1 , 2016 for $ 55.4 million , partially offset by the $ 7.0 million decrease in cash from short-term investment sales .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```liquidity and capital resources as of december 31 , 2017 and 2016 , we had $ 153.9 million and $ 108.4 million , respectively , in cash , cash equivalents and short-term and long-term investments . we invest available funds in short-term and long-term securities , including money market funds , corporate bonds , and asset backed securities , and do not engage in hedging or speculative activities . net cash provided by operating activities was approximately $ 197.8 million in 2017 and $ 148.0 million in 2016. the increase in net cash provided by operating activities was primarily attributable to ( 1 ) an increase in net income of $ 75.4 million ; ( 2 ) the lack of a stock option windfall tax benefit , which was $ 26.8 million in 2016 ; ( 3 ) an increase in stock-based compensation expense of $ 6.9 million ; and ( 4 ) an increase in other liabilities of $ 5.3 million ; partially offset by ( a ) a decrease in deferred income tax balance of $ 25.8 million ; ( b ) an increase in current income taxes receivable of $ 22.3 million ; ( c ) an increase in accounts receivable of $ 11.5 million ; and ( d ) an increase in other assets of $ 6.6 million . net cash used in investing activities was approximately $ 5.3 million in 2017 and $ 55.2 million in 2016. the decrease in net cash used in investing activities was primarily due to the prior period acquisition of shippingeasy on july 1 , 2016 for $ 55.4 million , partially offset by the $ 7.0 million decrease in cash from short-term investment sales . ``` Suspicious Activity Report : the results of our operations during the year ended december 31 , 2016 include the operations of shippingeasy for the period from july 1 , 2016 through december 31 , 2016. the results of our operations during 36 the years ended december 31 , 2017 and 2016 include the operations of endicia . the results of our operations during the year ended december 31 , 2015 include the operations of endicia for the period from november 18 , 2015 through december 31 , 2015. please see note 3 – “acquisitions” in our notes to consolidated financial statements for further description . accordingly , care should be used in comparing periods that include the operations of shippingeasy with those that do not include such operations . years ended december 31 , 2017 and 2016 total revenue increased 29 % to $ 468.7 million in 2017 from $ 364.3 million in 2016. mailing and shipping revenue , which includes service revenue , product revenue and insurance revenue , was $ 449.4 million in 2017 , an increase of 28 % from $ 350.6 million in 2016. customized postage revenue increased 41 % to $ 19.2 million in 2017 from $ 13.6 million in 2016. the following table sets forth the breakdown of revenue for 2017 and 2016 and the resulting percent change ( revenue in thousands ) : replace_table_token_5_th we define “paid customers” for the quarter as ones from whom we successfully collected service fees or otherwise earned revenue at least once during that quarter , and we define arpu as mailing and shipping revenue divided by paid customers . we define lost paid customers ( lost paid customers ) as customers from whom we successfully collected service fees or otherwise earned revenue at least once during the previous quarter but not during the current quarter , less recaptured paid customers . we define monthly paid customer cancellation rate ( monthly churn ) as a fraction , the numerator of which is the quotient of lost paid customers in a quarter divided by the sum of paid customers in the prior quarter and new paid customers in the current quarter , and the denominator of which is three months . the following table sets forth the number of paid customers in the period for our mailing and shipping business ( in thousands ) : replace_table_token_6_th the following table sets forth the growth in paid customers and arpu for our mailing and shipping business ( in thousands except arpu and percentage ) : replace_table_token_7_th the increase in paid customers is primarily the result of increased sales and marketing spend and better performance in our marketing programs . the increase in our arpu was primarily the result of the growth in our shipping business where we have the ability to better monetize postage volume as compared to monthly flat rate subscription fees . 37 revenue by product the following table shows our components of revenue and their respective percentages of total revenue for the periods indicated ( in thousands except percentage ) : replace_table_token_8_th our revenue is derived primarily from five sources : ( 1 ) service and transaction related revenues from our usps mailing and shipping services , our multi-carrier shipping services and our mailing and shipping integrations ; ( 2 ) product revenue from the direct sale of consumables and supplies through our supplies stores ; ( 3 ) package insurance revenue from our branded insurance offerings ; ( 4 ) customized postage revenue from the sale of photostamps and pictureitpostage postage labels ; and ( 5 ) other revenue , consisting of advertising revenue derived from advertising programs with our existing customers . we earn service revenue in several different ways : ( 1 ) customers may pay us a monthly fee based on a subscription plan which may be waived or refunded for certain customers ; ( 2 ) we may be compensated directly by the usps for certain qualifying customers under our usps partnership ; ( 3 ) we may earn transaction related revenue based on customers purchasing postage or printing shipping labels ; ( 4 ) we may earn compensation by offering customers a discounted postage rate that is provided to the customers by our integration partners ; and ( 5 ) we may earn other types of revenue shares or other compensation from specific customers or integration partners . service revenue increased 31 % to $ 411.3 million in 2017 from $ 313.1 million in 2016. the increase in service revenue consisted of a 12 % increase in our annual average paid customers and an 18 % increase in our average service revenue per paid customer ( service revenue arpu ) . the increase in the number of our paid customers was attributable to the factors described in the previous section . the increase in our service revenue arpu was attributable to ( 1 ) the factors that resulted in an increase in the average total mailing and shipping revenue per paid customer described in the previous section and ( 2 ) the renewal of two of our agreements with the usps with improved economics . product revenue increased 2 % to $ 20.7 million in 2017 from $ 20.2 million in 2016. product revenue is primarily driven by labels , such as netstamps and dymo stamps , which are used for mailing . however , our postage growth has been driven more by shipping than mailing over recent years . insurance revenue was $ 17.4 million in 2017 and $ 17.3 million in 2016. the growth in insurance revenue is less than the growth in service revenue primarily due to the increase in high volume shipper customers . high volume shipper customers often self-insure , so while the high volume shipping business results in higher service fee revenue , it may not result in higher insurance revenue . customized postage revenue increased 41 % to $ 19.2 million in 2017 from $ 13.6 million in 2016. story_separator_special_tag product revenue is primarily driven by labels , such as netstamps and dymo stamps , which are used for mailing . as our growth in postage has been driven more by shipping than mailing over the recent years , our growth in product revenue has been lower than our growth in total revenue . insurance revenue increased 47 % to $ 17.3 million in 2016 from $ 11.7 million in 2015. the increase in insurance revenue was primarily attributable to our acquisitions whose solutions target shipping customers who are more likely than mailing customers to purchase insurance . customized postage revenue increased 88 % to $ 13.6 million in 2016 from $ 7.2 million in 2015. the increase was primarily attributable to ( 1 ) an increase in photostamps high volume business orders , which increased by $ 2.9 million and ( 2 ) the addition of pictureitpostage as a result of our endicia acquisition , which added $ 4.1 million for the full year of 2016 as compared to the shorter period of 2015 for which endicia is included in our results . the increase in customized postage revenue was partially offset by a $ 0.6 million decrease in photostamps revenue from orders placed through the photostamps website . the decrease in revenue from website orders is primarily attributable to a reduction in our photostamps sales and marketing spending . cost of revenue the following table shows cost of revenues and cost of revenues as a percentage of associated revenue for the periods indicated ( in thousands except percentage ) : replace_table_token_15_th cost of service revenue principally consists of the cost of customer service , certain promotional expenses , system operating costs , credit card processing fees and customer misprints that do not qualify for reimbursement from the usps . cost of product revenue principally consists of the cost of products sold through our supplies stores and the related costs of shipping and handling . the cost of insurance revenue principally consists of parcel insurance offering costs through our third party insurance providers . cost of customized postage revenue principally consists of the face value of postage , customer service , image review costs , and printing and fulfillment costs . cost of service revenue increased 43 % to $ 40.0 million in 2016 from $ 28.0 million in 2015. the increase was primarily attributable to higher customer service costs , which increased by $ 6.0 million , to support our 44 growing customer base and higher credit card processing fees , which increased by $ 3.0 million , associated with our higher revenue . promotional expenses were not material in 2016. cost of service revenue as a percent of service revenue declined from 16 % in 2015 to 13 % in 2016. the decline was primarily attributable to achieving scale efficiencies in areas such as customer service from our growth in revenue . cost of product revenue increased 12 % to $ 6.7 million in 2016 from $ 6.0 million in 2015. the 12 % increase in cost of product revenue was primarily attributable to the increase in product revenue over the same time period . cost of product revenue as a percent of product revenue was 33 % in 2016 which was consistent with 2015. cost of insurance revenue increased 36 % to $ 5.4 million in 2016 from $ 4.0 million in 2015. the increase in cost of insurance revenue resulted from growth in the number of insurance transactions , which was primarily attributable to our acquisitions . cost of insurance revenue as a percent of insurance revenue declined from 34 % in 2015 to 31 % in 2016. the decline was primarily attributable to the insurance offerings of our acquired companies having higher prices for parcel insurance as compared to the rest of the company . cost of customized postage revenue increased 80 % to $ 10.8 million in 2016 from $ 6.0 million in 2015. the increase in cost of customized postage revenue is primarily due to the increase in our customized postage revenue . cost of customized postage revenue as a percent of customized postage revenue declined from 83 % in 2015 to 80 % in 2016. the decline was primarily the result of the addition of endicia 's pictureitpostage revenue which has a lower cost of customized postage revenue as a percent of customized postage revenue as compared to photostamps . pictureitpostage does not have a material level of high volume business orders which typically have a higher cost of customized postage revenue as a percent of customized postage revenue as compared to consumer website orders . operating expenses the following table outlines the components of our operating expense and their respective percentages of total revenues for the periods indicated ( in thousands except percentage ) : replace_table_token_16_th sales and marketing sales and marketing expense principally consists of spending to acquire new customers and compensation and related expenses for personnel engaged in sales , marketing , and business development activities . our sales and marketing programs include direct sales , customer referral programs , customer re-marketing efforts , direct mail , online advertising , partnerships , telemarketing , and traditional advertising . sales and marketing expense increased 40 % to $ 78.8 million in 2016 from $ 56.1 million in 2015. the increase is primarily due to ( 1 ) an increase in headcount-related expenses excluding stock-based compensation expense of $ 10.4 million , ( 2 ) an increase in stock-based compensation expense of $ 2.6 million and ( 3 ) an increase in discretionary marketing spend of $ 6.5 million . the increases in headcount-related and stock-based compensation expenses were due to both the addition of headcount resulting from our endicia and shippingeasy acquisitions as well as increased headcount in the rest of the company . 45 research and development research and development expense principally consists of compensation for personnel involved in the development of our services , depreciation of equipment

acquisitions are included in our results of operations from the effective dates of acquisition . in october 2013 , we acquired , through heico electronic , all of the outstanding stock of lucix corporation ( `` lucix `` ) in a transaction carried out by means of a merger . lucix is a leading designer and manufacturer of high performance , high reliability microwave modules , units , and integrated sub-systems for commercial and military satellites . on may 31 , 2013 , we acquired , through heico flight support corp. , reinhold industries , inc. ( `` reinhold `` ) through the acquisition of all of the outstanding stock of reinhold 's parent company in a transaction carried out by means of a merger . reinhold is a leading manufacturer of advanced niche components and complex composite assemblies for commercial aviation , defense and space applications . in october 2012 , we acquired , through heico flight support corp. , 80.1 % of the assets and assumed certain liabilities of action research corporation ( “ action research ” ) . action research is an faa-approved repair station that has developed unique proprietary repairs that extend the lives of certain engine and airframe components . the remaining 19.9 % interest continues to be owned by an existing member of action research 's management team . the purchase price of this acquisition was paid using cash provided by operating activities . in august 2012 , we acquired , through heico flight support corp. , 84 % of the assets and assumed certain liabilities of csi aerospace , inc. ( “ csi aerospace ” ) . csi aerospace is a leading repair and overhaul provider of specialized components for airlines , military and other aerospace related organizations . the remaining 16 % interest continues to be owned by certain members of csi aerospace 's management team . in april 2012 , we acquired , through heico electronic , certain aerospace assets of moritz aerospace , inc. ( “ moritz aerospace ” ) in an aerospace product line acquisition . the 29 index moritz aerospace product line designs and manufactures next generation wireless cabin control systems , solid state power distribution and management systems and fuel level sensing systems for business jets and for general aviation , as well as for the military/defense market segments . the purchase price of this acquisition was paid using cash provided by operating activities . in march 2012 , we acquired , through heico electronic , the business and substantially all of the assets of ramona research , inc. ( “ ramona research ” ) . ramona research designs and manufactures rf and microwave amplifiers , transmitters and receivers primarily used to support military communications on unmanned aerial systems , other aircraft , helicopters and ground-based data/communications systems . on november 22 , 2011 , we acquired , through heico electronic , switchcraft , inc. ( “ switchcraft ” ) through the purchase of all of the stock of switchcraft 's parent company , switchcraft holdco , inc. switchcraft is a leading designer and manufacturer of high performance , high reliability and harsh environment electronic connectors and other interconnect products . in september 2011 , we acquired , through heico electronic , all of the outstanding capital stock of 3d plus sa ( “ 3d plus ” ) . 3d plus is a leading designer and manufacturer of three-dimensional microelectronic and stacked memory products used predominately in satellites and also utilized in medical equipment . in december 2010 , we acquired , through heico aerospace , 80.1 % of the assets and assumed certain liabilities of blue aerospace llc ( “ blue aerospace ” ) . blue aerospace is a supplier , distributor , and integrator of military aircraft parts and support services primarily to foreign military organizations allied with the united states . the remaining 19.9 % interest continues to be owned by certain members of blue aerospace 's management team . unless otherwise noted , the purchase price of each of the above referenced acquisitions was paid in cash principally using proceeds from our revolving credit facility . the aggregate cost paid in cash for acquisitions , including additional purchase consideration payments , was $ 222.6 million , $ 197.3 million and $ 94.7 million in fiscal 2013 , 2012 and 2011 , respectively . in february 2011 , we acquired , through heico aerospace , an additional 8 % equity interest in one of our subsidiaries , which increased our ownership interest to 80 % . in february 2012 , we acquired an additional 6.7 % equity interest in the subsidiary , which increased our ownership interest to 86.7 % . in december 2012 , we acquired the remaining 13.3 % equity interest in the subsidiary . critical accounting policies we believe that the following are our most critical accounting policies , some of which require management to make judgments about matters that are inherently uncertain . 30 index revenue recognition revenue from the sale of products and the rendering of services is recognized when title and risk of loss passes to the customer , which is generally at the time of shipment . revenue from certain fixed price contracts for which costs can be dependably estimated is recognized on the percentage-of-completion method , measured by the percentage of costs incurred to date to estimated total costs for each contract . this method is used because management considers costs incurred to be the best available measure of progress on these contracts . variations in actual labor performance , changes to estimated profitability and final contract settlements may result in revisions to cost estimates . revisions in cost estimates as contracts progress have the effect of increasing or decreasing profits in the period of revision . provisions for estimated losses on uncompleted contracts are made in the period in which such losses are determined . story_separator_special_tag during fiscal 2014 , we will continue our focus on developing new products and services , further market penetration , additional acquisition opportunities and maintaining our financial strength . overall , we are targeting growth in fiscal 2014 full year net sales and net income over fiscal 2013 levels . 37 index comparison of fiscal 2012 to fiscal 2011 net sales our net sales in fiscal 2012 increased by 17 % to a record $ 897.3 million , as compared to net sales of $ 764.9 million in fiscal 2011. the increase in net sales reflects an increase of $ 103.8 million ( a 46 % increase ) to a record $ 331.6 million in net sales within the etg as well as an increase of $ 30.8 million ( a 6 % increase ) to a record $ 570.3 million in net sales within the fsg . the net sales increase in the etg reflects additional net sales of approximately $ 87.4 million from the acquisitions of 3d plus in september 2011 , switchcraft in november 2011 , ramona research in march 2012 and moritz aerospace in april 2012 , as well as organic growth of approximately 7 % . the organic growth in the etg principally reflects an increase in demand and market penetration for certain defense , space , electronic , aerospace and medical products , resulting in a $ 6.2 million , $ 3.5 million , $ 2.6 million , $ 2.1 million and $ 1.8 million increase in net sales from these product lines , respectively . the net sales increase in the fsg reflects organic growth of approximately 4 % , as well as additional net sales of approximately $ 9.1 million from the acquisitions of blue aerospace in december 2010 , csi aerospace in august 2012 and action research in october 2012. the fsg 's organic growth reflects increased market penetration from both new and existing product offerings for certain of the fsg 's aerospace products and services resulting in an increase of $ 11.3 million in net sales of which approximately 70 % and 30 % were attributed to the aftermarket replacement parts product lines and repair and overhaul services product lines , respectively . additionally , the organic growth in the fsg reflects an increase of $ 10.3 million in net sales within our specialty product lines primarily attributed to the sales of industrial products used in heavy-duty and off-road vehicles as a result of increased market penetration . sales price changes were not a significant contributing factor to the etg and fsg net sales growth in fiscal 2012. our net sales in fiscal 2012 and 2011 by market approximated 53 % and 60 % , respectively , from the commercial aviation industry , 26 % and 24 % , respectively , from the defense and space industries , and 21 % and 16 % , respectively , from other industrial markets including medical , electronics and telecommunications . gross profit and operating expenses our consolidated gross profit margin improved to 36.5 % in fiscal 2012 as compared to 35.9 % in fiscal 2011 , principally reflecting a .7 % increase in the fsg 's gross profit margin , partially offset by a 2.5 % decrease in the etg 's gross profit margin . the increase in the fsg 's gross profit margin is primarily attributed to the previously mentioned increased sales of higher gross profit margin products within our aftermarket replacement parts and repair and overhaul services product lines . the decrease in the etg 's gross profit margin principally reflects a 1.9 % impact from lower gross profit margins realized by switchcraft and 3d plus in fiscal 2012. the lower gross profit margins realized by these acquired businesses are principally attributed to amortization expense of certain acquired intangible assets and inventory purchase accounting adjustments aggregating approximately $ 4.0 million . additionally , the decrease in the etg 's gross profit margin reflects a lower margin product mix of certain of our defense , space and 38 index medical products in fiscal 2012. total new product research and development expenses included within our consolidated cost of sales increased from approximately $ 25.4 million in fiscal 2011 to approximately $ 30.4 million in fiscal 2012 , principally to further enhance growth opportunities and market penetration . sg & a expenses were $ 164.1 million and $ 136.0 million in fiscal 2012 and 2011 , respectively . the increase in sg & a expenses reflects an increase of $ 17.7 million in general and administrative expenses and $ 10.4 million in selling expenses , of which $ 16.3 million in general and administrative expenses and $ 7.6 million in selling expenses were attributed to the acquired businesses . sg & a expenses as a percentage of net sales increased from 17.8 % in fiscal 2011 to 18.3 % in fiscal 2012 principally reflecting an increase in amortization expense of intangible assets from the acquired businesses . operating income operating income for fiscal 2012 increased by 18 % to a record $ 163.3 million as compared to operating income of $ 138.4 million for fiscal 2011. the increase in operating income reflects an $ 18.0 million increase ( a 30 % increase ) to a record $ 77.4 million in operating income of the etg for fiscal 2012 , up from $ 59.5 million in fiscal 2011 and an $ 8.9 million increase ( a 9 % increase ) in operating income of the fsg to a record $ 103.9 million for fiscal 2012 , up from $ 95.0 million for fiscal 2011 , partially offset by a $ 2.0 million increase in corporate expenses . the increase in the operating income of the etg is principally due to the acquired businesses and the previously mentioned increased sales volumes . the increase in the operating income of the fsg principally reflects the previously mentioned increased sales volumes and improved gross profit margin .

liquidity and capital resources our capitalization was as follows ( in thousands ) : replace_table_token_9_th our principal uses of cash include acquisitions , cash dividends , capital expenditures , distributions to noncontrolling interests and working capital needs . capital expenditures in fiscal 2014 are anticipated to approximate $ 25 million . we finance our activities primarily from our operating activities and financing activities , including borrowings under long-term credit agreements . recent developments on november 22 , 2013 , we entered into an amendment to extend the maturity date of our revolving credit facility by one year to december 2018 and to increase the aggregate principal amount to $ 800 million . furthermore , the amendment includes a feature that will allow us to increase the aggregate principal amount by an additional $ 200 million , at our option , to become a $ 1.0 billion facility through increased commitments from existing lenders or the addition of new lenders . as of december 17 , 2013 , we had approximately $ 431 million of unused availability under the terms of our revolving credit facility . based on our current outlook , we believe that our net cash provided by operating activities and available borrowings under our revolving credit facility will be sufficient to fund cash requirements for at least the next twelve months .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```liquidity and capital resources our capitalization was as follows ( in thousands ) : replace_table_token_9_th our principal uses of cash include acquisitions , cash dividends , capital expenditures , distributions to noncontrolling interests and working capital needs . capital expenditures in fiscal 2014 are anticipated to approximate $ 25 million . we finance our activities primarily from our operating activities and financing activities , including borrowings under long-term credit agreements . recent developments on november 22 , 2013 , we entered into an amendment to extend the maturity date of our revolving credit facility by one year to december 2018 and to increase the aggregate principal amount to $ 800 million . furthermore , the amendment includes a feature that will allow us to increase the aggregate principal amount by an additional $ 200 million , at our option , to become a $ 1.0 billion facility through increased commitments from existing lenders or the addition of new lenders . as of december 17 , 2013 , we had approximately $ 431 million of unused availability under the terms of our revolving credit facility . based on our current outlook , we believe that our net cash provided by operating activities and available borrowings under our revolving credit facility will be sufficient to fund cash requirements for at least the next twelve months . ``` Suspicious Activity Report : acquisitions are included in our results of operations from the effective dates of acquisition . in october 2013 , we acquired , through heico electronic , all of the outstanding stock of lucix corporation ( `` lucix `` ) in a transaction carried out by means of a merger . lucix is a leading designer and manufacturer of high performance , high reliability microwave modules , units , and integrated sub-systems for commercial and military satellites . on may 31 , 2013 , we acquired , through heico flight support corp. , reinhold industries , inc. ( `` reinhold `` ) through the acquisition of all of the outstanding stock of reinhold 's parent company in a transaction carried out by means of a merger . reinhold is a leading manufacturer of advanced niche components and complex composite assemblies for commercial aviation , defense and space applications . in october 2012 , we acquired , through heico flight support corp. , 80.1 % of the assets and assumed certain liabilities of action research corporation ( “ action research ” ) . action research is an faa-approved repair station that has developed unique proprietary repairs that extend the lives of certain engine and airframe components . the remaining 19.9 % interest continues to be owned by an existing member of action research 's management team . the purchase price of this acquisition was paid using cash provided by operating activities . in august 2012 , we acquired , through heico flight support corp. , 84 % of the assets and assumed certain liabilities of csi aerospace , inc. ( “ csi aerospace ” ) . csi aerospace is a leading repair and overhaul provider of specialized components for airlines , military and other aerospace related organizations . the remaining 16 % interest continues to be owned by certain members of csi aerospace 's management team . in april 2012 , we acquired , through heico electronic , certain aerospace assets of moritz aerospace , inc. ( “ moritz aerospace ” ) in an aerospace product line acquisition . the 29 index moritz aerospace product line designs and manufactures next generation wireless cabin control systems , solid state power distribution and management systems and fuel level sensing systems for business jets and for general aviation , as well as for the military/defense market segments . the purchase price of this acquisition was paid using cash provided by operating activities . in march 2012 , we acquired , through heico electronic , the business and substantially all of the assets of ramona research , inc. ( “ ramona research ” ) . ramona research designs and manufactures rf and microwave amplifiers , transmitters and receivers primarily used to support military communications on unmanned aerial systems , other aircraft , helicopters and ground-based data/communications systems . on november 22 , 2011 , we acquired , through heico electronic , switchcraft , inc. ( “ switchcraft ” ) through the purchase of all of the stock of switchcraft 's parent company , switchcraft holdco , inc. switchcraft is a leading designer and manufacturer of high performance , high reliability and harsh environment electronic connectors and other interconnect products . in september 2011 , we acquired , through heico electronic , all of the outstanding capital stock of 3d plus sa ( “ 3d plus ” ) . 3d plus is a leading designer and manufacturer of three-dimensional microelectronic and stacked memory products used predominately in satellites and also utilized in medical equipment . in december 2010 , we acquired , through heico aerospace , 80.1 % of the assets and assumed certain liabilities of blue aerospace llc ( “ blue aerospace ” ) . blue aerospace is a supplier , distributor , and integrator of military aircraft parts and support services primarily to foreign military organizations allied with the united states . the remaining 19.9 % interest continues to be owned by certain members of blue aerospace 's management team . unless otherwise noted , the purchase price of each of the above referenced acquisitions was paid in cash principally using proceeds from our revolving credit facility . the aggregate cost paid in cash for acquisitions , including additional purchase consideration payments , was $ 222.6 million , $ 197.3 million and $ 94.7 million in fiscal 2013 , 2012 and 2011 , respectively . in february 2011 , we acquired , through heico aerospace , an additional 8 % equity interest in one of our subsidiaries , which increased our ownership interest to 80 % . in february 2012 , we acquired an additional 6.7 % equity interest in the subsidiary , which increased our ownership interest to 86.7 % . in december 2012 , we acquired the remaining 13.3 % equity interest in the subsidiary . critical accounting policies we believe that the following are our most critical accounting policies , some of which require management to make judgments about matters that are inherently uncertain . 30 index revenue recognition revenue from the sale of products and the rendering of services is recognized when title and risk of loss passes to the customer , which is generally at the time of shipment . revenue from certain fixed price contracts for which costs can be dependably estimated is recognized on the percentage-of-completion method , measured by the percentage of costs incurred to date to estimated total costs for each contract . this method is used because management considers costs incurred to be the best available measure of progress on these contracts . variations in actual labor performance , changes to estimated profitability and final contract settlements may result in revisions to cost estimates . revisions in cost estimates as contracts progress have the effect of increasing or decreasing profits in the period of revision . provisions for estimated losses on uncompleted contracts are made in the period in which such losses are determined . story_separator_special_tag during fiscal 2014 , we will continue our focus on developing new products and services , further market penetration , additional acquisition opportunities and maintaining our financial strength . overall , we are targeting growth in fiscal 2014 full year net sales and net income over fiscal 2013 levels . 37 index comparison of fiscal 2012 to fiscal 2011 net sales our net sales in fiscal 2012 increased by 17 % to a record $ 897.3 million , as compared to net sales of $ 764.9 million in fiscal 2011. the increase in net sales reflects an increase of $ 103.8 million ( a 46 % increase ) to a record $ 331.6 million in net sales within the etg as well as an increase of $ 30.8 million ( a 6 % increase ) to a record $ 570.3 million in net sales within the fsg . the net sales increase in the etg reflects additional net sales of approximately $ 87.4 million from the acquisitions of 3d plus in september 2011 , switchcraft in november 2011 , ramona research in march 2012 and moritz aerospace in april 2012 , as well as organic growth of approximately 7 % . the organic growth in the etg principally reflects an increase in demand and market penetration for certain defense , space , electronic , aerospace and medical products , resulting in a $ 6.2 million , $ 3.5 million , $ 2.6 million , $ 2.1 million and $ 1.8 million increase in net sales from these product lines , respectively . the net sales increase in the fsg reflects organic growth of approximately 4 % , as well as additional net sales of approximately $ 9.1 million from the acquisitions of blue aerospace in december 2010 , csi aerospace in august 2012 and action research in october 2012. the fsg 's organic growth reflects increased market penetration from both new and existing product offerings for certain of the fsg 's aerospace products and services resulting in an increase of $ 11.3 million in net sales of which approximately 70 % and 30 % were attributed to the aftermarket replacement parts product lines and repair and overhaul services product lines , respectively . additionally , the organic growth in the fsg reflects an increase of $ 10.3 million in net sales within our specialty product lines primarily attributed to the sales of industrial products used in heavy-duty and off-road vehicles as a result of increased market penetration . sales price changes were not a significant contributing factor to the etg and fsg net sales growth in fiscal 2012. our net sales in fiscal 2012 and 2011 by market approximated 53 % and 60 % , respectively , from the commercial aviation industry , 26 % and 24 % , respectively , from the defense and space industries , and 21 % and 16 % , respectively , from other industrial markets including medical , electronics and telecommunications . gross profit and operating expenses our consolidated gross profit margin improved to 36.5 % in fiscal 2012 as compared to 35.9 % in fiscal 2011 , principally reflecting a .7 % increase in the fsg 's gross profit margin , partially offset by a 2.5 % decrease in the etg 's gross profit margin . the increase in the fsg 's gross profit margin is primarily attributed to the previously mentioned increased sales of higher gross profit margin products within our aftermarket replacement parts and repair and overhaul services product lines . the decrease in the etg 's gross profit margin principally reflects a 1.9 % impact from lower gross profit margins realized by switchcraft and 3d plus in fiscal 2012. the lower gross profit margins realized by these acquired businesses are principally attributed to amortization expense of certain acquired intangible assets and inventory purchase accounting adjustments aggregating approximately $ 4.0 million . additionally , the decrease in the etg 's gross profit margin reflects a lower margin product mix of certain of our defense , space and 38 index medical products in fiscal 2012. total new product research and development expenses included within our consolidated cost of sales increased from approximately $ 25.4 million in fiscal 2011 to approximately $ 30.4 million in fiscal 2012 , principally to further enhance growth opportunities and market penetration . sg & a expenses were $ 164.1 million and $ 136.0 million in fiscal 2012 and 2011 , respectively . the increase in sg & a expenses reflects an increase of $ 17.7 million in general and administrative expenses and $ 10.4 million in selling expenses , of which $ 16.3 million in general and administrative expenses and $ 7.6 million in selling expenses were attributed to the acquired businesses . sg & a expenses as a percentage of net sales increased from 17.8 % in fiscal 2011 to 18.3 % in fiscal 2012 principally reflecting an increase in amortization expense of intangible assets from the acquired businesses . operating income operating income for fiscal 2012 increased by 18 % to a record $ 163.3 million as compared to operating income of $ 138.4 million for fiscal 2011. the increase in operating income reflects an $ 18.0 million increase ( a 30 % increase ) to a record $ 77.4 million in operating income of the etg for fiscal 2012 , up from $ 59.5 million in fiscal 2011 and an $ 8.9 million increase ( a 9 % increase ) in operating income of the fsg to a record $ 103.9 million for fiscal 2012 , up from $ 95.0 million for fiscal 2011 , partially offset by a $ 2.0 million increase in corporate expenses . the increase in the operating income of the etg is principally due to the acquired businesses and the previously mentioned increased sales volumes . the increase in the operating income of the fsg principally reflects the previously mentioned increased sales volumes and improved gross profit margin .

except as required by law , we disclaim any obligation to review or update these forward-looking statements to reflect events or circumstances as they occur . readers should carefully review our risk factors described in this annual report on form 10-k. 17 business overview gartner , inc. ( nyse : it ) is the world 's leading research and advisory company and a member of the s & p 500. we equip business leaders with indispensable insights , advice and tools to achieve their mission-critical priorities and build the successful organizations of tomorrow . we believe our unmatched combination of expert-led , practitioner-sourced and data-driven research steers clients toward the right decisions on the issues that matter most . we 're trusted as an objective resource and critical partner by more than 12,000 organizations in more than 100 countries across all major functions , in every industry and enterprise size . gartner is headquartered in stamford , connecticut , u.s.a. and , as of december 31 , 2017 , we had more than 15,000 associates , including 2,650 research analysts and consultants . gartner delivers its products and services globally through four business segments : research , consulting , events , and talent assessment & other : research provides trusted , objective insights and advice on the mission-critical priorities of leaders across all functional areas of the enterprise through research and other reports , briefings , proprietary tools , access to our analysts , peer networking services and membership programs that enable our clients to make better decisions . gartner 's traditional strengths in it , marketing and supply chain research were enhanced in 2017 with gartner 's acquisition of ceb , inc. , which added ceb 's best practice and talent management research insights across a range of business functions , to include human resources , sales , legal and finance . consulting provides customized solutions to unique client needs through on-site , day-to-day support , as well as proprietary tools for measuring and improving it performance with a focus on cost , performance , efficiency and quality . events provides business professionals across the organization the opportunity to learn , share and network . from our flagship cio event gartner symposium/itxpo , to industry-leading conferences focused on specific business roles and topics , to member-driven sessions , our events enable attendees to experience the best of gartner insight and advice live . talent assessment & other helps organizations assess , engage , manage and improve talent . this is accomplished through knowledge and skills assessments , training programs , workshops , and survey and questionnaire services . 18 business measurements we believe that the following business measurements are important performance indicators for our business segments : business segment business measurements research total contract value represents the value attributable to all of our subscription-related contracts . it is calculated as the annualized value of all contracts in effect at a specific point in time , without regard to the duration of the contract . total contract value primarily includes research deliverables for which revenue is recognized on a ratable basis , as well as other deliverables ( primarily events tickets ) for which revenue is recognized when the deliverable is utilized . client retention rate represents a measure of client satisfaction and renewed business relationships at a specific point in time . client retention is calculated on a percentage basis by dividing our current clients , who were also clients a year ago , by all clients from a year ago . client retention is calculated at an enterprise level , which represents a single company or customer . wallet retention rate represents a measure of the amount of contract value we have retained with clients over a twelve-month period . wallet retention is calculated on a percentage basis by dividing the contract value of clients , who were clients one year ago , by the total contract value from a year ago , excluding the impact of foreign currency exchange . when wallet retention exceeds client retention , it is an indication of retention of higher-spending clients , or increased spending by retained clients , or both . wallet retention is calculated at an enterprise level , which represents a single company or customer . consulting consulting backlog represents future revenue to be derived from in-process consulting and measurement engagements . utilization rate represents a measure of productivity of our consultants . utilization rates are calculated for billable headcount on a percentage basis by dividing total hours billed by total hours available to bill . billing rate represents earned billable revenue divided by total billable hours . average annualized revenue per billable headcount represents a measure of the revenue generating ability of an average billable consultant and is calculated periodically by multiplying the average billing rate per hour times the utilization percentage times the billable hours available for one year . events number of events represents the total number of hosted events completed during the period . single day , local events are excluded . number of attendees represents the total number of people who attend events . single day , local events are excluded . 19 executive summary of operations and financial position we have executed a consistent growth strategy since 2005 to drive revenue and earnings growth . the fundamentals of our strategy include a focus on creating extraordinary research insight , delivering innovative and highly differentiated product offerings , building a strong sales capability , providing world class client service with a focus on client engagement and retention , and continuously improving our operational effectiveness . we also continue to focus on maximizing shareholder value . story_separator_special_tag as a result , if circumstances change and the company deems it necessary in the future to modify the assumptions it made or to use different assumptions , or if the quantity and nature of the company 's stock-based compensation awards changes , then the amount of expense may need to be adjusted and future stock-based compensation expense could be materially different from what has been recorded in the current period . restructuring and other accruals — we may record accruals for severance costs , costs associated with excess facilities that we have leased , contract terminations , asset impairments and other costs as a result of ongoing actions we undertake to streamline our organization , reposition certain businesses and reduce ongoing costs . estimates of costs to be incurred to complete these actions , such as future lease payments , sublease income , the fair value of assets , and severance and related benefits , are based on assumptions at the time the actions are initiated . these accruals may need to be adjusted to the extent actual costs differ from such estimates . in addition , these actions may be revised due to changes in business conditions that we did not foresee at the time such plans were approved . we also record accruals during the year for our various employee cash incentive programs . amounts accrued at the end of each reporting period are based on our estimates and may require adjustment as the ultimate amount paid for these incentives are sometimes not known with certainty until the end of our fiscal year . 23 results of operations consolidated results 2017 versus 2016 the table below presents an analysis of selected line items and year-over-year changes in our consolidated statements of operations for the two years ended december 31 , 2017 ( in thousands ) . the operating results of ceb are included beginning on april 5 , 2017 , the date of the acquisition . replace_table_token_5_th total revenues for the year ended december 31 , 2017 increased $ 867.0 million , to $ 3.3 billion , an increase of 35 % compared to the year ended december 31 , 2016 on both a reported basis and adjusted for foreign exchange impact . ceb contributed approximately $ 522.9 million of the revenue increase . the table below presents total revenues by geographic region for the years indicated ( in thousands ) : replace_table_token_6_th the table below presents our revenues by segment for the years indicated ( in thousands ) : replace_table_token_7_th please refer to the section of this md & a below entitled “ segment results ” for a discussion of revenues and results by segment . 24 cost of services and product development was $ 1.3 billion in 2017 , an increase of $ 374.6 million compared to 2016 , or 40 % on both a reported basis and excluding the impact of foreign exchange . approximately $ 238.0 million of the increase was attributable to ceb . the $ 136.6 million increase attributable to heritage gartner was primarily due to higher payroll and related benefits costs resulting from increased headcount , which increased 20 % . cost of services and product development as a percentage of revenues was 40 % and 39 % for 2017 and 2016 , respectively . selling , general and administrative ( “ sg & a ” ) expense was $ 1.6 billion in 2017 , an increase of $ 509.8 million compared to 2016 , or 47 % on both a reported basis and excluding the impact of foreign exchange . approximately $ 283.8 million of the increase was attributable to ceb . heritage gartner sg & a costs for 2017 increased $ 226.0 million , primarily due to $ 107.4 million in higher payroll and related benefits costs , reflecting a 17 % overall headcount increase ; $ 33.8 million in higher commissions due to increased sales bookings ; and $ 84.8 million in higher corporate costs and foreign exchange impact . the overall headcount growth includes a 16 % increase in quota-bearing sales associates , which increased to 2,807 at december 31 , 2017 from 2,423 at december 31 , 2016. depreciation increased $ 26.7 million during 2017 when compared to 2016 , due to property , equipment and leasehold improvements acquired with ceb and additional heritage gartner investment . amortization of intangibles increased $ 151.5 million during 2017 when compared to 2016 due to additional amortization from the intangibles recorded in connection with our recent acquisitions . acquisition and integration charges increased $ 115.9 million during 2017 when compared to 2016. this increase reflects the additional charges resulting from our recent acquisitions and primarily consist of higher professional fees , severance , stock-based compensation charges and accruals for exit costs for certain office space that the company does not intend to occupy in arlington , virginia . operating ( loss ) income was an operating loss of $ ( 6.3 ) million during 2017 compared to operating income of $ 305.1 million in 2016. the decline reflects several factors . we had a lower segment contribution margin in our research business resulting from a ceb deferred revenue fair value adjustment . we also had higher sg & a and acquisition-related costs , including depreciation , amortization of intangibles , and acquisition and integration charges . interest expense , net increased $ 99.8 million during 2017 when compared to 2016. the increase was primarily due to higher borrowings during 2017. other income , net was $ 3.4 million during 2017 , primarily reflecting the net impact of foreign currency gains and losses from our hedging activities , as well as the sale of certain state tax credits and the recognition of other tax incentives . other income , net was $ 8.4 million in 2016 , which included a gain of $ 2.5 million from the extinguishment of a portion of an economic development loan from the state

liquidity and capital resources we finance our operations through cash generated from our operating activities and borrowings ( note 5 — debt in the notes to the consolidated financial statements provides additional information regarding the company 's 2016 credit agreement and other outstanding debt obligations ) . at december 31 , 2017 , we had $ 538.9 million of cash and cash equivalents and $ 558.0 million of available borrowing capacity on the revolving credit facility portion of our 2016 credit agreement . we believe that the company has adequate liquidity to meet its currently anticipated needs , to include the payment of the transition tax liability related to the tax cuts and jobs act of 2017. note 10 — income taxes in the notes to the consolidated financial statements provides information related to the tax cuts and jobs act of 2017. we have historically generated significant cash flows from our operating activities . our operating cash flow has been continuously maintained and enhanced by the leverage characteristics of our subscription-based business model in our research segment , which is our largest business segment . revenues in our research segment increased 33 % in 2017 compared to 2016 , and constituted 75 % of our total revenues in both 2017 and 2016. the majority of our research customer contracts are paid in advance , and combined with a strong customer retention rate and high incremental margins , has resulted in continuously strong operating cash flow . our cash flow generation has also benefited from our continuing efforts to improve the operating efficiencies of our businesses as well as a focus on the optimal management of our working capital as we increase our sales volume .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```liquidity and capital resources we finance our operations through cash generated from our operating activities and borrowings ( note 5 — debt in the notes to the consolidated financial statements provides additional information regarding the company 's 2016 credit agreement and other outstanding debt obligations ) . at december 31 , 2017 , we had $ 538.9 million of cash and cash equivalents and $ 558.0 million of available borrowing capacity on the revolving credit facility portion of our 2016 credit agreement . we believe that the company has adequate liquidity to meet its currently anticipated needs , to include the payment of the transition tax liability related to the tax cuts and jobs act of 2017. note 10 — income taxes in the notes to the consolidated financial statements provides information related to the tax cuts and jobs act of 2017. we have historically generated significant cash flows from our operating activities . our operating cash flow has been continuously maintained and enhanced by the leverage characteristics of our subscription-based business model in our research segment , which is our largest business segment . revenues in our research segment increased 33 % in 2017 compared to 2016 , and constituted 75 % of our total revenues in both 2017 and 2016. the majority of our research customer contracts are paid in advance , and combined with a strong customer retention rate and high incremental margins , has resulted in continuously strong operating cash flow . our cash flow generation has also benefited from our continuing efforts to improve the operating efficiencies of our businesses as well as a focus on the optimal management of our working capital as we increase our sales volume . ``` Suspicious Activity Report : except as required by law , we disclaim any obligation to review or update these forward-looking statements to reflect events or circumstances as they occur . readers should carefully review our risk factors described in this annual report on form 10-k. 17 business overview gartner , inc. ( nyse : it ) is the world 's leading research and advisory company and a member of the s & p 500. we equip business leaders with indispensable insights , advice and tools to achieve their mission-critical priorities and build the successful organizations of tomorrow . we believe our unmatched combination of expert-led , practitioner-sourced and data-driven research steers clients toward the right decisions on the issues that matter most . we 're trusted as an objective resource and critical partner by more than 12,000 organizations in more than 100 countries across all major functions , in every industry and enterprise size . gartner is headquartered in stamford , connecticut , u.s.a. and , as of december 31 , 2017 , we had more than 15,000 associates , including 2,650 research analysts and consultants . gartner delivers its products and services globally through four business segments : research , consulting , events , and talent assessment & other : research provides trusted , objective insights and advice on the mission-critical priorities of leaders across all functional areas of the enterprise through research and other reports , briefings , proprietary tools , access to our analysts , peer networking services and membership programs that enable our clients to make better decisions . gartner 's traditional strengths in it , marketing and supply chain research were enhanced in 2017 with gartner 's acquisition of ceb , inc. , which added ceb 's best practice and talent management research insights across a range of business functions , to include human resources , sales , legal and finance . consulting provides customized solutions to unique client needs through on-site , day-to-day support , as well as proprietary tools for measuring and improving it performance with a focus on cost , performance , efficiency and quality . events provides business professionals across the organization the opportunity to learn , share and network . from our flagship cio event gartner symposium/itxpo , to industry-leading conferences focused on specific business roles and topics , to member-driven sessions , our events enable attendees to experience the best of gartner insight and advice live . talent assessment & other helps organizations assess , engage , manage and improve talent . this is accomplished through knowledge and skills assessments , training programs , workshops , and survey and questionnaire services . 18 business measurements we believe that the following business measurements are important performance indicators for our business segments : business segment business measurements research total contract value represents the value attributable to all of our subscription-related contracts . it is calculated as the annualized value of all contracts in effect at a specific point in time , without regard to the duration of the contract . total contract value primarily includes research deliverables for which revenue is recognized on a ratable basis , as well as other deliverables ( primarily events tickets ) for which revenue is recognized when the deliverable is utilized . client retention rate represents a measure of client satisfaction and renewed business relationships at a specific point in time . client retention is calculated on a percentage basis by dividing our current clients , who were also clients a year ago , by all clients from a year ago . client retention is calculated at an enterprise level , which represents a single company or customer . wallet retention rate represents a measure of the amount of contract value we have retained with clients over a twelve-month period . wallet retention is calculated on a percentage basis by dividing the contract value of clients , who were clients one year ago , by the total contract value from a year ago , excluding the impact of foreign currency exchange . when wallet retention exceeds client retention , it is an indication of retention of higher-spending clients , or increased spending by retained clients , or both . wallet retention is calculated at an enterprise level , which represents a single company or customer . consulting consulting backlog represents future revenue to be derived from in-process consulting and measurement engagements . utilization rate represents a measure of productivity of our consultants . utilization rates are calculated for billable headcount on a percentage basis by dividing total hours billed by total hours available to bill . billing rate represents earned billable revenue divided by total billable hours . average annualized revenue per billable headcount represents a measure of the revenue generating ability of an average billable consultant and is calculated periodically by multiplying the average billing rate per hour times the utilization percentage times the billable hours available for one year . events number of events represents the total number of hosted events completed during the period . single day , local events are excluded . number of attendees represents the total number of people who attend events . single day , local events are excluded . 19 executive summary of operations and financial position we have executed a consistent growth strategy since 2005 to drive revenue and earnings growth . the fundamentals of our strategy include a focus on creating extraordinary research insight , delivering innovative and highly differentiated product offerings , building a strong sales capability , providing world class client service with a focus on client engagement and retention , and continuously improving our operational effectiveness . we also continue to focus on maximizing shareholder value . story_separator_special_tag as a result , if circumstances change and the company deems it necessary in the future to modify the assumptions it made or to use different assumptions , or if the quantity and nature of the company 's stock-based compensation awards changes , then the amount of expense may need to be adjusted and future stock-based compensation expense could be materially different from what has been recorded in the current period . restructuring and other accruals — we may record accruals for severance costs , costs associated with excess facilities that we have leased , contract terminations , asset impairments and other costs as a result of ongoing actions we undertake to streamline our organization , reposition certain businesses and reduce ongoing costs . estimates of costs to be incurred to complete these actions , such as future lease payments , sublease income , the fair value of assets , and severance and related benefits , are based on assumptions at the time the actions are initiated . these accruals may need to be adjusted to the extent actual costs differ from such estimates . in addition , these actions may be revised due to changes in business conditions that we did not foresee at the time such plans were approved . we also record accruals during the year for our various employee cash incentive programs . amounts accrued at the end of each reporting period are based on our estimates and may require adjustment as the ultimate amount paid for these incentives are sometimes not known with certainty until the end of our fiscal year . 23 results of operations consolidated results 2017 versus 2016 the table below presents an analysis of selected line items and year-over-year changes in our consolidated statements of operations for the two years ended december 31 , 2017 ( in thousands ) . the operating results of ceb are included beginning on april 5 , 2017 , the date of the acquisition . replace_table_token_5_th total revenues for the year ended december 31 , 2017 increased $ 867.0 million , to $ 3.3 billion , an increase of 35 % compared to the year ended december 31 , 2016 on both a reported basis and adjusted for foreign exchange impact . ceb contributed approximately $ 522.9 million of the revenue increase . the table below presents total revenues by geographic region for the years indicated ( in thousands ) : replace_table_token_6_th the table below presents our revenues by segment for the years indicated ( in thousands ) : replace_table_token_7_th please refer to the section of this md & a below entitled “ segment results ” for a discussion of revenues and results by segment . 24 cost of services and product development was $ 1.3 billion in 2017 , an increase of $ 374.6 million compared to 2016 , or 40 % on both a reported basis and excluding the impact of foreign exchange . approximately $ 238.0 million of the increase was attributable to ceb . the $ 136.6 million increase attributable to heritage gartner was primarily due to higher payroll and related benefits costs resulting from increased headcount , which increased 20 % . cost of services and product development as a percentage of revenues was 40 % and 39 % for 2017 and 2016 , respectively . selling , general and administrative ( “ sg & a ” ) expense was $ 1.6 billion in 2017 , an increase of $ 509.8 million compared to 2016 , or 47 % on both a reported basis and excluding the impact of foreign exchange . approximately $ 283.8 million of the increase was attributable to ceb . heritage gartner sg & a costs for 2017 increased $ 226.0 million , primarily due to $ 107.4 million in higher payroll and related benefits costs , reflecting a 17 % overall headcount increase ; $ 33.8 million in higher commissions due to increased sales bookings ; and $ 84.8 million in higher corporate costs and foreign exchange impact . the overall headcount growth includes a 16 % increase in quota-bearing sales associates , which increased to 2,807 at december 31 , 2017 from 2,423 at december 31 , 2016. depreciation increased $ 26.7 million during 2017 when compared to 2016 , due to property , equipment and leasehold improvements acquired with ceb and additional heritage gartner investment . amortization of intangibles increased $ 151.5 million during 2017 when compared to 2016 due to additional amortization from the intangibles recorded in connection with our recent acquisitions . acquisition and integration charges increased $ 115.9 million during 2017 when compared to 2016. this increase reflects the additional charges resulting from our recent acquisitions and primarily consist of higher professional fees , severance , stock-based compensation charges and accruals for exit costs for certain office space that the company does not intend to occupy in arlington , virginia . operating ( loss ) income was an operating loss of $ ( 6.3 ) million during 2017 compared to operating income of $ 305.1 million in 2016. the decline reflects several factors . we had a lower segment contribution margin in our research business resulting from a ceb deferred revenue fair value adjustment . we also had higher sg & a and acquisition-related costs , including depreciation , amortization of intangibles , and acquisition and integration charges . interest expense , net increased $ 99.8 million during 2017 when compared to 2016. the increase was primarily due to higher borrowings during 2017. other income , net was $ 3.4 million during 2017 , primarily reflecting the net impact of foreign currency gains and losses from our hedging activities , as well as the sale of certain state tax credits and the recognition of other tax incentives . other income , net was $ 8.4 million in 2016 , which included a gain of $ 2.5 million from the extinguishment of a portion of an economic development loan from the state

once the project is substantially complete and ready for its intended use these costs are amortized on a straight-line basis over the technology 's estimated useful life of three years . we have begun to amortize capitalized development costs in may 2016. for the year ended september 30 , 2017 and september 30 , 2016 amortization expense related to capitalized software development costs were $ 22,700 and $ 12,611 respectively and the accumulated amortization was $ 35,311 and $ 12,611 respectively . intangible assets intangible assets with finite lives primarily consist of licensed technology and are amortized on a straight-line basis over the expected period to be benefited by future cash flows of two years and reviewed for impairment . for the year ended september 30 , 2017 and september 30 , 2016 amortization expense related to licensed technology were $ 7,917 and $ 0 respectively and the accumulated amortization was $ 7,917 and $ 0 respectively . impairment of long-lived assets in accordance with asc topic 360 , the company reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets may not be fully recoverable , or at least annually . the company recognizes an impairment loss when the sum of expected undiscounted future cash flows is less than the carrying amount of the asset . the amount of impairment is measured as the difference between the asset 's estimated fair value and its book value . the company reviews intangible assets for impairment whenever events or changes in circumstances indicate that the carrying value of assets may not be recoverable , as a result during the year ended september 30 , 2017 , we recorded a non-cash impairment charge of $ 85,572 ( which consisted of a $ 128,800 cost less accumulated amortization of $ 43,228 ) , associated with our software development costs . these charges are included in the statements of operations . - 16 - revenue recognition we recognize revenue when persuasive evidence of a sale arrangement exists , services have been rendered , the sales price is fixed and determinable and collectability is reasonably assured . revenues consists of fees generated through the electronic processing of payment transactions and related services , and is recognized as revenue during the period the transactions are processed or when the related services are performed . merchants may be charged for these processing services at a bundled rate based on a percentage of the dollar amount of each transaction and , in some instances , additional fees are charged for each transaction . merchant customers are generally charged a flat fee per transaction , while others may also be charged miscellaneous fees , including fees for chargebacks or returns , monthly minimums , and other miscellaneous services . revenues also includes any up-front fees for the work involved in implementing the basic functionality required to provide electronic payment processing services to a customer . revenue from such implementation fees is recognized over the term of the related service contract . our revenue is comprised of monthly recurring services provided to customers , for whom charges are contracted for over a specified period of time . payments received from customers that are related to future periods are recorded as deferred revenue until the service is provided . stock-based compensation stock-based compensation is accounted for based on the requirements of the asc 718 , share-based payment , which requires recognition in the financial statements of the cost of employee and director services received in exchange for an award of equity instruments over the period the employee or director is required to perform the services in exchange for the award ( presumptively , the vesting period ) . the financial accounting standards board ( “ fasb ” ) also requires measurement of the cost of employee and director services received in exchange for an award based on the grant-date fair value of the award . pursuant to asc topic 505-50 , for share-based payments to consultants and other third-parties , compensation expense is determined at the “ measurement date . ” the expense is recognized over the vesting period of the award . until the measurement date is reached , the total amount of compensation expense remains uncertain . we record compensation expense based on the fair value of the award at the reporting date . - 17 - recent accounting pronouncements in may 2014 , the fasb issued accounting standards update no . 2014-09 , “ revenue from contracts with customers ( topic 606 ) , ” ( “ asu 2014-09 ” ) . asu 2014-09 outlines a new , single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance , including industry-specific guidance . this new revenue recognition model provides a five-step analysis in determining when and how revenue is recognized . the new model will require revenue recognition to depict the transfer of promised goods or services to customers in an amount that reflects the consideration a company expects to receive in exchange for those goods or services . asu 2014-09 is effective for public entities for annual reporting periods beginning after december 15 , 2016 and interim periods within those periods . early adoption is not permitted . the fasb has approved a one-year deferral of the effective date with the option to early adopt using the original effective date . entities may use either a full retrospective or a modified retrospective approach to adopt asu 2014-09. in december 2016 , the fasb issued accounting standards update no . 2016-20 , technical corrections and improvements to topic 606 , revenue from contracts with customers , or asu 2016-20. in may 2016 , the fasb issued accounting standards update no . story_separator_special_tag cost of revenues for the year ended september 30 , 2017 , we had $ 29,527 in cost of revenues as compared to $ 21,813 for the year ended september 30 , 2016 , an increase of $ 7,714. cost of revenues increased primarily due to an increase in hosting and software maintenance fees , operating expenses for the year ended september 30 , 2017 , we incurred $ 5,049,196 in operating expenses as compared to $ 144,701 for the year ended september 30 , 2016 , an increase of $ 4,904,495. operating expenses consisted of the following : replace_table_token_0_th operating expenses increased primarily due to · for the year ended september 30 , 2017 , we had an increase in compensation of $ 3,043,350 , primarily due to stock based compensation to our directors and ceo for $ 3,045,000 . · we had an increase in professional fees of $ 1,754,498 , primarily due to an increase in consulting fees of $ 1,622,700 from stock based compensation , increase in investor relations fees of $ 99,100 , primarily due to stock based consulting fees of $ 51,000 , an increase in accounting and audit fees of $ 14,635 , due to the hiring of an accounting consultant , an increase in fees incurred to become a trading company of $ 12,000 , offset by a decrease in legal fees of $ 6,948 . · we had an increase in amortization of development costs of $ 10,089 . · we had an increase in amortization of intangible assets of $ 7,917 , which we started to amortize in may , 2017 . · we recorded of an impairment charge of $ 85,572 related to software development cost and intangible assets . - 20 - loss from operations for the year ended september 30 , 2017 , we incurred a loss from operations of $ 5,050,684 as compared to $ 138,929 for the year ended september 30 , 2016 , an increase of $ 4,911,755. the increase of $ 4,911,755 , was resulting from the discussion above . since inception , our business activity has focused on the development of our corporate entity , business plan , marketing strategy , contact development , website design and product design , and development of our payment gateway called “ clickdirectpay ” . other expenses for the year september 30 , 2017 , we incurred total other expense of $ 1,151 as compared to other expense of $ 3,534 , a decrease of $ 2,383 for the year ended september 30 , 2017. the decrease in other expenses was related to the recording of a loss on sale of marketable securities of $ 1,693 during the year ended september 30 , 2017 as compared to a loss of $ 2,445 for year ended september 30 , 2016. net loss for the year ended september 30 , 2017 , we incurred a net loss of $ 5,051,835 or $ ( 0.10 ) per common share as compared to $ 142,463 or $ ( 0.00 ) per common share for the year ended september 30 , 2016 , an increase of $ 4,909,372 , resulting from the discussion above . unrealized loss on available-for-sale marketable securities for the year september 30 , 2017 , we incurred an unrealized gain on available-for-sale marketable securities of $ 2,011 as compared to an unrealized ( loss ) of ( $ 1,115 ) for the year ended september 30 , 2016 , an increase of $ 3,126 related to our marketable securities that we invested during fiscal 2017. comprehensive loss for the year ended september 30 , 2017 , we incurred a comprehensive loss of $ 5,049,824 as compared to $ 143,578 for the year ended september 30 , 2016 , an increase of $ 4,906,246 resulting from the discussion above . liquidity , capital resources , and off-balance sheet arrangements liquidity is the ability of an enterprise to generate adequate amounts of cash to meet its needs for cash requirements . we had working capital of $ 262 and $ 12,694 of cash at september 30 , 2017 and working capital of $ 15,189 and $ 34,572 of cash at september 30 , 2016. cash flows for the year ended september 30 , 2017 compared to the year ended september 30 , 2016 net cash flow used in operating activities was $ 147,156 for the year ended september 30 , 2017 as compared to $ 69,559 for the year ended september 30 , 2016 , an increase of $ 77,597 . ● net cash flow used in operating activities for the year ended september 30 , 2017 primarily reflected a net loss of $ 5,051,835 and the add-back of non-cash items consisting of stock-based compensation of $ 4,779,950 , amortization of software development costs and intangible asset of $ 30,617 , a non-cash asset impairment charge of $ 85,572 and a loss on sale of marketable securities of $ 1,693 , offset by changes in operating assets and liabilities of $ 6,847 primarily related to an increase in prepaid expenses of $ 4,167 offset by an increase in accounts payable of $ 18,532. during the year ended september 30 , 2017 , cash used in operating activities primarily consisted of payments of professional fees . ● net cash flow used in operating activities for the year ended september 30 , 2016 primarily reflected a net loss of $ 142,463 and the addback of noncash items consisting of stock-based compensation of $ 45,150 , amortization of development costs of $ 12,611 , and a loss on sale of marketable securities of $ 2,445 , and changes in operating assets and liabilities of $ 12.698. during the year ended september 30 , 2016 , cash used in operating activities primarily consisted of payments of professional fees . - 21 - net cash flow provided by investing activities was $ 10,020 for the year ended september 30 , 2017 as compared to

cash requirements our management does not believe that our current capital resources will be adequate to continue operating our company and maintaining our business strategy for much more than 12 months . at the date hereof , we have minimal cash at hand . we require additional capital to implement our business and fund our operations . between october 2016 and march 2017 , we issued 571,900 of shares of common stock for cash of $ 115,258. on october 10 , 2017 , the company issued a 12 % convertible promissory note for principal borrowings of $ 160,000 to a non-related party . the 12 % convertible promissory note and all accrued interest are due on july 10 , 2018. the company received proceeds of $ 143,250 in cash which is net of offering costs of $ 16,750. the note is unsecured and bears interest at the rate of 12 % per annum from the issuance date thereof until the note is paid . the company paid original issuance cost of $ 16,750 in connection with this note payable which will be recorded at a discount and amortized over the term of the note . since inception we have funded our operations primarily through equity financings and we expect that wewill continue to fund our operations through the equity and debt financing , either alone or through strategic alliances .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```cash requirements our management does not believe that our current capital resources will be adequate to continue operating our company and maintaining our business strategy for much more than 12 months . at the date hereof , we have minimal cash at hand . we require additional capital to implement our business and fund our operations . between october 2016 and march 2017 , we issued 571,900 of shares of common stock for cash of $ 115,258. on october 10 , 2017 , the company issued a 12 % convertible promissory note for principal borrowings of $ 160,000 to a non-related party . the 12 % convertible promissory note and all accrued interest are due on july 10 , 2018. the company received proceeds of $ 143,250 in cash which is net of offering costs of $ 16,750. the note is unsecured and bears interest at the rate of 12 % per annum from the issuance date thereof until the note is paid . the company paid original issuance cost of $ 16,750 in connection with this note payable which will be recorded at a discount and amortized over the term of the note . since inception we have funded our operations primarily through equity financings and we expect that wewill continue to fund our operations through the equity and debt financing , either alone or through strategic alliances . ``` Suspicious Activity Report : once the project is substantially complete and ready for its intended use these costs are amortized on a straight-line basis over the technology 's estimated useful life of three years . we have begun to amortize capitalized development costs in may 2016. for the year ended september 30 , 2017 and september 30 , 2016 amortization expense related to capitalized software development costs were $ 22,700 and $ 12,611 respectively and the accumulated amortization was $ 35,311 and $ 12,611 respectively . intangible assets intangible assets with finite lives primarily consist of licensed technology and are amortized on a straight-line basis over the expected period to be benefited by future cash flows of two years and reviewed for impairment . for the year ended september 30 , 2017 and september 30 , 2016 amortization expense related to licensed technology were $ 7,917 and $ 0 respectively and the accumulated amortization was $ 7,917 and $ 0 respectively . impairment of long-lived assets in accordance with asc topic 360 , the company reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets may not be fully recoverable , or at least annually . the company recognizes an impairment loss when the sum of expected undiscounted future cash flows is less than the carrying amount of the asset . the amount of impairment is measured as the difference between the asset 's estimated fair value and its book value . the company reviews intangible assets for impairment whenever events or changes in circumstances indicate that the carrying value of assets may not be recoverable , as a result during the year ended september 30 , 2017 , we recorded a non-cash impairment charge of $ 85,572 ( which consisted of a $ 128,800 cost less accumulated amortization of $ 43,228 ) , associated with our software development costs . these charges are included in the statements of operations . - 16 - revenue recognition we recognize revenue when persuasive evidence of a sale arrangement exists , services have been rendered , the sales price is fixed and determinable and collectability is reasonably assured . revenues consists of fees generated through the electronic processing of payment transactions and related services , and is recognized as revenue during the period the transactions are processed or when the related services are performed . merchants may be charged for these processing services at a bundled rate based on a percentage of the dollar amount of each transaction and , in some instances , additional fees are charged for each transaction . merchant customers are generally charged a flat fee per transaction , while others may also be charged miscellaneous fees , including fees for chargebacks or returns , monthly minimums , and other miscellaneous services . revenues also includes any up-front fees for the work involved in implementing the basic functionality required to provide electronic payment processing services to a customer . revenue from such implementation fees is recognized over the term of the related service contract . our revenue is comprised of monthly recurring services provided to customers , for whom charges are contracted for over a specified period of time . payments received from customers that are related to future periods are recorded as deferred revenue until the service is provided . stock-based compensation stock-based compensation is accounted for based on the requirements of the asc 718 , share-based payment , which requires recognition in the financial statements of the cost of employee and director services received in exchange for an award of equity instruments over the period the employee or director is required to perform the services in exchange for the award ( presumptively , the vesting period ) . the financial accounting standards board ( “ fasb ” ) also requires measurement of the cost of employee and director services received in exchange for an award based on the grant-date fair value of the award . pursuant to asc topic 505-50 , for share-based payments to consultants and other third-parties , compensation expense is determined at the “ measurement date . ” the expense is recognized over the vesting period of the award . until the measurement date is reached , the total amount of compensation expense remains uncertain . we record compensation expense based on the fair value of the award at the reporting date . - 17 - recent accounting pronouncements in may 2014 , the fasb issued accounting standards update no . 2014-09 , “ revenue from contracts with customers ( topic 606 ) , ” ( “ asu 2014-09 ” ) . asu 2014-09 outlines a new , single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance , including industry-specific guidance . this new revenue recognition model provides a five-step analysis in determining when and how revenue is recognized . the new model will require revenue recognition to depict the transfer of promised goods or services to customers in an amount that reflects the consideration a company expects to receive in exchange for those goods or services . asu 2014-09 is effective for public entities for annual reporting periods beginning after december 15 , 2016 and interim periods within those periods . early adoption is not permitted . the fasb has approved a one-year deferral of the effective date with the option to early adopt using the original effective date . entities may use either a full retrospective or a modified retrospective approach to adopt asu 2014-09. in december 2016 , the fasb issued accounting standards update no . 2016-20 , technical corrections and improvements to topic 606 , revenue from contracts with customers , or asu 2016-20. in may 2016 , the fasb issued accounting standards update no . story_separator_special_tag cost of revenues for the year ended september 30 , 2017 , we had $ 29,527 in cost of revenues as compared to $ 21,813 for the year ended september 30 , 2016 , an increase of $ 7,714. cost of revenues increased primarily due to an increase in hosting and software maintenance fees , operating expenses for the year ended september 30 , 2017 , we incurred $ 5,049,196 in operating expenses as compared to $ 144,701 for the year ended september 30 , 2016 , an increase of $ 4,904,495. operating expenses consisted of the following : replace_table_token_0_th operating expenses increased primarily due to · for the year ended september 30 , 2017 , we had an increase in compensation of $ 3,043,350 , primarily due to stock based compensation to our directors and ceo for $ 3,045,000 . · we had an increase in professional fees of $ 1,754,498 , primarily due to an increase in consulting fees of $ 1,622,700 from stock based compensation , increase in investor relations fees of $ 99,100 , primarily due to stock based consulting fees of $ 51,000 , an increase in accounting and audit fees of $ 14,635 , due to the hiring of an accounting consultant , an increase in fees incurred to become a trading company of $ 12,000 , offset by a decrease in legal fees of $ 6,948 . · we had an increase in amortization of development costs of $ 10,089 . · we had an increase in amortization of intangible assets of $ 7,917 , which we started to amortize in may , 2017 . · we recorded of an impairment charge of $ 85,572 related to software development cost and intangible assets . - 20 - loss from operations for the year ended september 30 , 2017 , we incurred a loss from operations of $ 5,050,684 as compared to $ 138,929 for the year ended september 30 , 2016 , an increase of $ 4,911,755. the increase of $ 4,911,755 , was resulting from the discussion above . since inception , our business activity has focused on the development of our corporate entity , business plan , marketing strategy , contact development , website design and product design , and development of our payment gateway called “ clickdirectpay ” . other expenses for the year september 30 , 2017 , we incurred total other expense of $ 1,151 as compared to other expense of $ 3,534 , a decrease of $ 2,383 for the year ended september 30 , 2017. the decrease in other expenses was related to the recording of a loss on sale of marketable securities of $ 1,693 during the year ended september 30 , 2017 as compared to a loss of $ 2,445 for year ended september 30 , 2016. net loss for the year ended september 30 , 2017 , we incurred a net loss of $ 5,051,835 or $ ( 0.10 ) per common share as compared to $ 142,463 or $ ( 0.00 ) per common share for the year ended september 30 , 2016 , an increase of $ 4,909,372 , resulting from the discussion above . unrealized loss on available-for-sale marketable securities for the year september 30 , 2017 , we incurred an unrealized gain on available-for-sale marketable securities of $ 2,011 as compared to an unrealized ( loss ) of ( $ 1,115 ) for the year ended september 30 , 2016 , an increase of $ 3,126 related to our marketable securities that we invested during fiscal 2017. comprehensive loss for the year ended september 30 , 2017 , we incurred a comprehensive loss of $ 5,049,824 as compared to $ 143,578 for the year ended september 30 , 2016 , an increase of $ 4,906,246 resulting from the discussion above . liquidity , capital resources , and off-balance sheet arrangements liquidity is the ability of an enterprise to generate adequate amounts of cash to meet its needs for cash requirements . we had working capital of $ 262 and $ 12,694 of cash at september 30 , 2017 and working capital of $ 15,189 and $ 34,572 of cash at september 30 , 2016. cash flows for the year ended september 30 , 2017 compared to the year ended september 30 , 2016 net cash flow used in operating activities was $ 147,156 for the year ended september 30 , 2017 as compared to $ 69,559 for the year ended september 30 , 2016 , an increase of $ 77,597 . ● net cash flow used in operating activities for the year ended september 30 , 2017 primarily reflected a net loss of $ 5,051,835 and the add-back of non-cash items consisting of stock-based compensation of $ 4,779,950 , amortization of software development costs and intangible asset of $ 30,617 , a non-cash asset impairment charge of $ 85,572 and a loss on sale of marketable securities of $ 1,693 , offset by changes in operating assets and liabilities of $ 6,847 primarily related to an increase in prepaid expenses of $ 4,167 offset by an increase in accounts payable of $ 18,532. during the year ended september 30 , 2017 , cash used in operating activities primarily consisted of payments of professional fees . ● net cash flow used in operating activities for the year ended september 30 , 2016 primarily reflected a net loss of $ 142,463 and the addback of noncash items consisting of stock-based compensation of $ 45,150 , amortization of development costs of $ 12,611 , and a loss on sale of marketable securities of $ 2,445 , and changes in operating assets and liabilities of $ 12.698. during the year ended september 30 , 2016 , cash used in operating activities primarily consisted of payments of professional fees . - 21 - net cash flow provided by investing activities was $ 10,020 for the year ended september 30 , 2017 as compared to

with respect to most of our client assets under management , we utilize a “ value ” investment style focused on achieving superior long-term , risk-adjusted returns by investing in companies with high levels of free cash flow , improving returns on equity and strengthening balance sheets that are well positioned for growth but whose value is not fully recognized in the marketplace . this investment approach is designed to preserve capital during unfavorable periods and provide superior real returns over the long term . our investment teams have significant industry experience . our investment team members have average investment experience of seventeen years . we have focused on building a foundation in terms of personnel and infrastructure to support a potentially much larger business . we have also developed investment strategies that we believe will be desirable within our target institutional , wealth management and mutual fund markets . the cost of developing new products and growing the organization as a whole has resulted in our incurring expenses that , in some cases , do not currently have significant offsetting revenues . while we continue to evolve our products , we believe that the appropriate foundation and products are in place such that investors will recognize the value in these products , thereby generating new revenue streams for westwood . 2018 highlights the following items are highlights for the year ended december 31 , 2018 : assets under management as of december 31 , 2018 were $ 16.6 billion , a 31 % decrease compared to december 31 , 2017 . quarterly average assets under management decreased 8 % to $ 21.4 billion for 2018 compared to 2017 , which contributed to the 9 % decrease in total revenue from 2017. our largecap value , emerging markets plus , smidcap , smidcap plus , emerging markets , and emerging markets smidcap strategies exhibited strong performance . our smallcap strategy was selected as a subadvisor to the morningstar u.s. equity fund . the effective tax rate decreased to 26.6 % for 2018 compared to 41.0 % for 2017 related to the tax reform act enacted in december 2017. in october 2018 , our board approved a 6 % increase in our quarterly dividend to $ 0.72 per share for an annual rate of $ 2.88 per share , which results in a dividend yield of 8.5 % using the year-end stock price of $ 34.00 per share . we repurchased 108,289 shares of our common stock for an aggregate purchase price of $ 4.0 million . our financial position remains strong with liquid cash and short-term investments of $ 118.2 million and no debt as of december 31 , 2018 . we closed the sale of our omaha-based wealth management operations , received net proceeds of $ 10.0 million and recognized a $ 0.5 million gain on sale . 25 revenues we derive our revenues from investment advisory fees , trust fees and other revenues . our advisory fees are generated by westwood management and westwood international advisors , which manage client accounts under investment advisory and subadvisory agreements . advisory fees are calculated based on a percentage of assets under management and are paid in accordance with the terms of the agreements . advisory fees are paid quarterly in advance based on assets under management on the last day of the preceding quarter , quarterly in arrears based on assets under management on the last day of the quarter just ended , or are based on a daily or monthly analysis of assets under management for the stated period . we recognize advisory fee revenues as services are rendered . a limited number of our clients have a contractual performance-based fee component in their contracts , which generates additional revenues if we outperform a specified index over a specific period of time . we record revenue for performance-based fees at the end of the measurement period . since our advance paying clients ' billing periods coincide with the calendar quarter to which such payments relate , revenue is recognized within the quarter , and our consolidated financial statements contain no deferred advisory fee revenues . our trust fees are generated by westwood trust pursuant to trust or custodial agreements . trust fees are separately negotiated with each client and are generally based on a percentage of assets under management . westwood trust also provides trust services to a small number of clients on a fixed fee basis . trust fees are primarily either paid quarterly in arrears based on a daily average of assets under management for the quarter , or monthly based on the month-end assets under management . since billing periods for most of westwood trust 's clients coincide with the calendar quarter , revenue is fully recognized within the quarter and our consolidated financial statements do not contain a significant amount of deferred revenue . our other revenues generally consist of interest and investment income . although we generally invest most of our cash in u.s. treasury securities , we also invest in equity and fixed income instruments and money market funds , including seed money for new investment strategies . employee compensation and benefits employee compensation and benefits costs generally consist of salaries , incentive compensation , equity-based compensation expense and benefits . sales and marketing sales and marketing costs relate to our marketing efforts , including travel and entertainment , direct marketing and advertising costs . westwood mutual funds westwood mutual funds expenses relate to our marketing , distribution and administration of the westwood funds ® . information technology information technology expenses are generally costs associated with proprietary investment research tools , maintenance and support , computing hardware , software licenses , telecommunications and other related costs . professional services professional services expenses generally consist of costs associated with subadvisory fees , audit , legal and other professional services . story_separator_special_tag as the company and its representatives do not have representation on the westwood funds® or the private equity independent boards of directors , which direct the activities that most significantly impact the entities ' economic performance , we determined that the westwood funds® and the private equity were not vies . therefore , the ucits fund , westwood funds® and private equity should be analyzed under the voe consolidation method . based on our analysis of our investments in these entities for the periods ending december 31 , 2018 and 2017 , we have not consolidated the ctfs , private equity funds or llcs under the vie method or the ucits fund , westwood funds® or private equity under the voe method , and therefore the financial results of these entities are not included in the company 's consolidated financial results . we have included the disclosures related to vies and voes in note 12 “ variable interest entities ” to our consolidated financial statements included in part ii . item 8 “ financial statements and supplementary data . ” business combinations in allocating the purchase price of a business combination , the company records all assets acquired and liabilities assumed at fair value with the excess of the purchase price over the aggregate fair values recorded as goodwill . asc 820 , fair 35 value measurements and disclosures , defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date . the purchase price of an acquisition is allocated to the underlying assets acquired and liabilities assumed based upon their estimated fair values as of the date of acquisition . to the extent the purchase price exceeds the fair value of the net identifiable tangible and intangible assets acquired and liabilities assumed such excess is allocated to goodwill . the company determines the estimated fair values after review and consideration of relevant information , including discounted cash flows , quoted market prices and estimates made by management . the fair value assigned to identifiable intangible assets acquired is based on estimates and assumptions made by management at the time of the acquisition . the company adjusts the preliminary purchase price allocation , as necessary , during the measurement period of up to one year after the acquisition closing date as it obtains more information as to the facts and circumstances existing as of the acquisition date . acquisition-related costs are recognized separately from the acquisition purchase price and are expensed as incurred . goodwill goodwill is not amortized but is tested for impairment , at least annually . we assess the recoverability of the carrying amount of goodwill either qualitatively or quantitatively as of july 1 of each fiscal year or whenever events or changes in circumstances indicate that the carrying amount of the assets may not be fully recoverable . when assessing the recoverability of goodwill , we may first assess qualitative factors . if an initial qualitative assessment indicates that it is more likely than not that the carrying amount exceeds fair value , a quantitative analysis may be required . we may also elect to skip the qualitative assessment and proceed directly to the quantitative analysis . recoverability of the carrying value of goodwill is measured at the reporting unit level . we have identified two reporting units , which are consistent with our reporting segments . in performing a quantitative analysis , we measure the recoverability of goodwill for our reporting units using a combination of the income approach and the market multiple approach . the income approach is based on the long-term projected future cash flows of the reporting units . we discount the estimated cash flows to present value using a weighted average cost of capital that considers factors such as market assumptions , the timing of cash flows and the risks inherent in such cash flows . the key assumptions used in the market multiple valuation require significant management judgment , including the determination of our peer group and the valuation multiples of such peer group . if the carrying value exceeds the fair value , an impairment loss is measured by reducing the goodwill to the fair market value . we completed our annual impairment assessments during 2018 , 2017 and 2016 and concluded that no impairment losses were required . intangible assets our definite-lived intangible assets represent the acquisition date fair value of the intangible assets acquired , net of amortization . the values of these assets are comprised mostly of client relationships but also include valuations of trade names and non-compete agreements . in valuing these assets , we made significant estimates regarding the useful life , growth rates and potential attrition of the assets acquired . we periodically review our intangible assets for events or circumstances that would indicate impairment . if we determine the carrying value exceeds fair value , we would record an impairment to remove the amount that exceeded fair value . we completed our annual impairment assessments during 2018 , 2017 and 2016 and concluded that no impairment losses were required . stock-based compensation we have granted restricted stock to employees and non-employee directors . we calculate compensation cost for restricted stock grants by using the fair market value of our common stock at the date of grant , the number of shares issued and an adjustment for restrictions on dividends . we amortize compensation cost on a straight-line basis over the applicable service period . we adjust our compensation cost for forfeitures as they occur . we grant performance-based share awards to certain employees , the vesting of which is subject to the employee 's continuing employment and the company 's achievement of certain performance goals . we assess actual performance versus the predetermined performance goals and record compensation costs once we conclude that it is probable that we will meet the performance

liquidity and capital resources replace_table_token_11_th we had cash and short-term investments of $ 118.2 million and $ 105.6 million as of december 31 , 2018 and 2017 , respectively . cash and cash equivalents includes approximately $ 33 million of undistributed income from westwood international advisors for both periods ending december 31 , 2018 and 2017 . in accordance with the one-time mandatory deemed repatriation required under tax legislation signed into law in december 2017 , we paid $ 1.8 million in income taxes related to this undistributed income . if these funds were needed for our u.s. operations , we would be required to accrue and pay incremental canadian withholding taxes to repatriate a portion of these funds . our current intent is to permanently reinvest the funds subject to withholding taxes outside of the u.s. , and our current forecasts do not demonstrate a need to repatriate them to fund our u.s. operations . at december 31 , 2018 and 2017 , working capital aggregated $ 114.0 million and $ 106.6 million , respectively . as required by the finance code , westwood trust is subject to a minimum capital requirement of $ 4.0 million . at december 31 , 32 2018 , westwood trust had approximately $ 18.6 million in excess of its minimum capital requirement . we had no debt at december 31 , 2018 or december 31 , 2017 . replace_table_token_12_th historically we have funded our operations and cash requirements with cash generated from operating activities . we may also use cash from operations to pay dividends to our stockholders . as of december 31 , 2018 and 2017 , we had no debt . the changes in net cash provided by operating activities generally reflect the changes in earnings plus the effects of non-cash items and changes in working capital . changes in working capital , especially accounts receivable and accounts payable , generally result from timing differences between collection of fees billed and payment of operating expenses .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```liquidity and capital resources replace_table_token_11_th we had cash and short-term investments of $ 118.2 million and $ 105.6 million as of december 31 , 2018 and 2017 , respectively . cash and cash equivalents includes approximately $ 33 million of undistributed income from westwood international advisors for both periods ending december 31 , 2018 and 2017 . in accordance with the one-time mandatory deemed repatriation required under tax legislation signed into law in december 2017 , we paid $ 1.8 million in income taxes related to this undistributed income . if these funds were needed for our u.s. operations , we would be required to accrue and pay incremental canadian withholding taxes to repatriate a portion of these funds . our current intent is to permanently reinvest the funds subject to withholding taxes outside of the u.s. , and our current forecasts do not demonstrate a need to repatriate them to fund our u.s. operations . at december 31 , 2018 and 2017 , working capital aggregated $ 114.0 million and $ 106.6 million , respectively . as required by the finance code , westwood trust is subject to a minimum capital requirement of $ 4.0 million . at december 31 , 32 2018 , westwood trust had approximately $ 18.6 million in excess of its minimum capital requirement . we had no debt at december 31 , 2018 or december 31 , 2017 . replace_table_token_12_th historically we have funded our operations and cash requirements with cash generated from operating activities . we may also use cash from operations to pay dividends to our stockholders . as of december 31 , 2018 and 2017 , we had no debt . the changes in net cash provided by operating activities generally reflect the changes in earnings plus the effects of non-cash items and changes in working capital . changes in working capital , especially accounts receivable and accounts payable , generally result from timing differences between collection of fees billed and payment of operating expenses . ``` Suspicious Activity Report : with respect to most of our client assets under management , we utilize a “ value ” investment style focused on achieving superior long-term , risk-adjusted returns by investing in companies with high levels of free cash flow , improving returns on equity and strengthening balance sheets that are well positioned for growth but whose value is not fully recognized in the marketplace . this investment approach is designed to preserve capital during unfavorable periods and provide superior real returns over the long term . our investment teams have significant industry experience . our investment team members have average investment experience of seventeen years . we have focused on building a foundation in terms of personnel and infrastructure to support a potentially much larger business . we have also developed investment strategies that we believe will be desirable within our target institutional , wealth management and mutual fund markets . the cost of developing new products and growing the organization as a whole has resulted in our incurring expenses that , in some cases , do not currently have significant offsetting revenues . while we continue to evolve our products , we believe that the appropriate foundation and products are in place such that investors will recognize the value in these products , thereby generating new revenue streams for westwood . 2018 highlights the following items are highlights for the year ended december 31 , 2018 : assets under management as of december 31 , 2018 were $ 16.6 billion , a 31 % decrease compared to december 31 , 2017 . quarterly average assets under management decreased 8 % to $ 21.4 billion for 2018 compared to 2017 , which contributed to the 9 % decrease in total revenue from 2017. our largecap value , emerging markets plus , smidcap , smidcap plus , emerging markets , and emerging markets smidcap strategies exhibited strong performance . our smallcap strategy was selected as a subadvisor to the morningstar u.s. equity fund . the effective tax rate decreased to 26.6 % for 2018 compared to 41.0 % for 2017 related to the tax reform act enacted in december 2017. in october 2018 , our board approved a 6 % increase in our quarterly dividend to $ 0.72 per share for an annual rate of $ 2.88 per share , which results in a dividend yield of 8.5 % using the year-end stock price of $ 34.00 per share . we repurchased 108,289 shares of our common stock for an aggregate purchase price of $ 4.0 million . our financial position remains strong with liquid cash and short-term investments of $ 118.2 million and no debt as of december 31 , 2018 . we closed the sale of our omaha-based wealth management operations , received net proceeds of $ 10.0 million and recognized a $ 0.5 million gain on sale . 25 revenues we derive our revenues from investment advisory fees , trust fees and other revenues . our advisory fees are generated by westwood management and westwood international advisors , which manage client accounts under investment advisory and subadvisory agreements . advisory fees are calculated based on a percentage of assets under management and are paid in accordance with the terms of the agreements . advisory fees are paid quarterly in advance based on assets under management on the last day of the preceding quarter , quarterly in arrears based on assets under management on the last day of the quarter just ended , or are based on a daily or monthly analysis of assets under management for the stated period . we recognize advisory fee revenues as services are rendered . a limited number of our clients have a contractual performance-based fee component in their contracts , which generates additional revenues if we outperform a specified index over a specific period of time . we record revenue for performance-based fees at the end of the measurement period . since our advance paying clients ' billing periods coincide with the calendar quarter to which such payments relate , revenue is recognized within the quarter , and our consolidated financial statements contain no deferred advisory fee revenues . our trust fees are generated by westwood trust pursuant to trust or custodial agreements . trust fees are separately negotiated with each client and are generally based on a percentage of assets under management . westwood trust also provides trust services to a small number of clients on a fixed fee basis . trust fees are primarily either paid quarterly in arrears based on a daily average of assets under management for the quarter , or monthly based on the month-end assets under management . since billing periods for most of westwood trust 's clients coincide with the calendar quarter , revenue is fully recognized within the quarter and our consolidated financial statements do not contain a significant amount of deferred revenue . our other revenues generally consist of interest and investment income . although we generally invest most of our cash in u.s. treasury securities , we also invest in equity and fixed income instruments and money market funds , including seed money for new investment strategies . employee compensation and benefits employee compensation and benefits costs generally consist of salaries , incentive compensation , equity-based compensation expense and benefits . sales and marketing sales and marketing costs relate to our marketing efforts , including travel and entertainment , direct marketing and advertising costs . westwood mutual funds westwood mutual funds expenses relate to our marketing , distribution and administration of the westwood funds ® . information technology information technology expenses are generally costs associated with proprietary investment research tools , maintenance and support , computing hardware , software licenses , telecommunications and other related costs . professional services professional services expenses generally consist of costs associated with subadvisory fees , audit , legal and other professional services . story_separator_special_tag as the company and its representatives do not have representation on the westwood funds® or the private equity independent boards of directors , which direct the activities that most significantly impact the entities ' economic performance , we determined that the westwood funds® and the private equity were not vies . therefore , the ucits fund , westwood funds® and private equity should be analyzed under the voe consolidation method . based on our analysis of our investments in these entities for the periods ending december 31 , 2018 and 2017 , we have not consolidated the ctfs , private equity funds or llcs under the vie method or the ucits fund , westwood funds® or private equity under the voe method , and therefore the financial results of these entities are not included in the company 's consolidated financial results . we have included the disclosures related to vies and voes in note 12 “ variable interest entities ” to our consolidated financial statements included in part ii . item 8 “ financial statements and supplementary data . ” business combinations in allocating the purchase price of a business combination , the company records all assets acquired and liabilities assumed at fair value with the excess of the purchase price over the aggregate fair values recorded as goodwill . asc 820 , fair 35 value measurements and disclosures , defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date . the purchase price of an acquisition is allocated to the underlying assets acquired and liabilities assumed based upon their estimated fair values as of the date of acquisition . to the extent the purchase price exceeds the fair value of the net identifiable tangible and intangible assets acquired and liabilities assumed such excess is allocated to goodwill . the company determines the estimated fair values after review and consideration of relevant information , including discounted cash flows , quoted market prices and estimates made by management . the fair value assigned to identifiable intangible assets acquired is based on estimates and assumptions made by management at the time of the acquisition . the company adjusts the preliminary purchase price allocation , as necessary , during the measurement period of up to one year after the acquisition closing date as it obtains more information as to the facts and circumstances existing as of the acquisition date . acquisition-related costs are recognized separately from the acquisition purchase price and are expensed as incurred . goodwill goodwill is not amortized but is tested for impairment , at least annually . we assess the recoverability of the carrying amount of goodwill either qualitatively or quantitatively as of july 1 of each fiscal year or whenever events or changes in circumstances indicate that the carrying amount of the assets may not be fully recoverable . when assessing the recoverability of goodwill , we may first assess qualitative factors . if an initial qualitative assessment indicates that it is more likely than not that the carrying amount exceeds fair value , a quantitative analysis may be required . we may also elect to skip the qualitative assessment and proceed directly to the quantitative analysis . recoverability of the carrying value of goodwill is measured at the reporting unit level . we have identified two reporting units , which are consistent with our reporting segments . in performing a quantitative analysis , we measure the recoverability of goodwill for our reporting units using a combination of the income approach and the market multiple approach . the income approach is based on the long-term projected future cash flows of the reporting units . we discount the estimated cash flows to present value using a weighted average cost of capital that considers factors such as market assumptions , the timing of cash flows and the risks inherent in such cash flows . the key assumptions used in the market multiple valuation require significant management judgment , including the determination of our peer group and the valuation multiples of such peer group . if the carrying value exceeds the fair value , an impairment loss is measured by reducing the goodwill to the fair market value . we completed our annual impairment assessments during 2018 , 2017 and 2016 and concluded that no impairment losses were required . intangible assets our definite-lived intangible assets represent the acquisition date fair value of the intangible assets acquired , net of amortization . the values of these assets are comprised mostly of client relationships but also include valuations of trade names and non-compete agreements . in valuing these assets , we made significant estimates regarding the useful life , growth rates and potential attrition of the assets acquired . we periodically review our intangible assets for events or circumstances that would indicate impairment . if we determine the carrying value exceeds fair value , we would record an impairment to remove the amount that exceeded fair value . we completed our annual impairment assessments during 2018 , 2017 and 2016 and concluded that no impairment losses were required . stock-based compensation we have granted restricted stock to employees and non-employee directors . we calculate compensation cost for restricted stock grants by using the fair market value of our common stock at the date of grant , the number of shares issued and an adjustment for restrictions on dividends . we amortize compensation cost on a straight-line basis over the applicable service period . we adjust our compensation cost for forfeitures as they occur . we grant performance-based share awards to certain employees , the vesting of which is subject to the employee 's continuing employment and the company 's achievement of certain performance goals . we assess actual performance versus the predetermined performance goals and record compensation costs once we conclude that it is probable that we will meet the performance

this represents the second consecutive year of gross margin expansion , after 2017 increased from 8.8 % of net sales in 2016. selling , general and administrative ( “ sg & a ” ) expenses increased by $ 2.9 million in 2018. the increase in sg & a was driven by higher employee related costs , including incentive compensation , associated with the increased business levels . overall , our operating income in 2018 was $ 16.1 million , compared to $ 4.2 million in 2017 , reflecting overall improved operational results . during 2018 , we generated $ 16.6 million of cash from operating activities , and used $ 15.4 million on capital expenditures , a significant portion of which was strategic capital spending related to finished bar production at our dunkirk facility . 15 our financing activities provide d net cash of $ 2.7 million . the company completed an equity offering in the second quarter of 2018 , which included the sale of 1 .4 million shares of common stock and raised $ 32.2 million of net proceeds . the proceeds were used to pay down our revolving cre dit facility . we entered into a new credit agreement that provide d a revolving credit facility of up to $ 110.0 million and a term loan facility of $ 10.0 million . we also entered into a new markets tax credit ( “ nmtc ” ) financing agreement , which provided low interest financing for our mid-size bar cell capital project at our dunkirk , ny facility . our operating facilities are integrated , and therefore our chief operating decision maker ( “ codm ” ) views the company as one business unit . our codm sets performance goals , assesses performance and makes decisions about resource allocations on a consolidated basis . as a result of these factors , as well as the nature of the financial information available which is reviewed by our codm , we maintain one reportable segment . results of operations 2018 results compared to 2017 replace_table_token_6_th 16 market segment information : replace_table_token_7_th melt type information : replace_table_token_8_th the majority of our products are sold to service centers rather than the ultimate end market customers . the end market information in this annual report is our estimate based upon our knowledge of our customers and the grade of material sold to them , which they will in-turn sell to the ultimate end market customer . end market information : replace_table_token_9_th net sales : net sales for the year ended december 31 , 2018 increased $ 53.3 million , or 26.3 % , compared to 2017. the increase in our sales reflects a 13.5 % increase in consolidated tons shipped , as demand for our products increased as a result of strengthening market conditions throughout 2018 , and a 11.3 % increase in sales dollars per shipped ton . the increase in sales dollars per shipped ton was driven by improved product mix , increased surcharges , and base price increases implemented during the year . 17 our product sales to all of our end markets except power generation increased as shown in the above table . our premium alloy sales reached a record level of $ 41.1 mill ion , or 16.1 % of total sales , for the year ended december 31 , 201 8 , compared to $ 27.3 million , or 13.5 % of total sales , for the year ended december 31 , 201 7 . our premium alloy sales are primarily for the a erospace end market . gross margin : our gross margin , as a percentage of net sales , increased to 14.8 % in 2018 from 11.4 % in 2017. the increase in gross margin is a result of better alignment of melt costs and surcharges for the majority of the current year , and the realization of manufacturing and productivity savings . gross margin in 2018 was adversely impacted toward the end of the year by the misalignment of customer surcharges and melt costs . selling , general and administrative expenses : our sg & a expenses consist primarily of employee costs including salaries , incentive compensation , payroll taxes and benefit related costs , legal and accounting services , share compensation and insurance costs . our sg & a expenses increased by $ 2.9 million for the year ended december 31 , 2018 compared to 2017. the increase is driven by higher employee related costs , including incentive compensation , consistent with increased business activity during the year . as a percentage of sales , our sg & a expenses were 8.5 % in 2018 compared to 9.3 % in 2017. interest expense and deferred financing amortization : our interest costs on our debt was $ 4.0 million for the years ended december 31 , 2018 and 2017. although our debt levels were substantially reduced for the second half of the 2018 , the variable interest rates charged on our credit agreement debt increased steadily throughout the year . the interest rate on our variable rate debt is determined by a libor-based rate plus an applicable margin based upon achieving certain ratios . other income : other income was $ 0.8 million in 2018 compared to less than $ 0.1 million in 2017. this increase is due to a favorable legal settlement of $ 0.7 million received in the second quarter of 2018. provision ( benefit ) from income taxes : the 2018 income tax provision is $ 1.9 million , compared to an income tax benefit of $ 7.6 million for 2017. the significant components of the current year tax provision include the federal statutory rate of 21 % , offset by the benefit of research and development tax credits . story_separator_special_tag million has been classified within current portion of long-term debt . additionally , the company has the option to further extend the maturity date of the notes to march 17 , 2021. extending the maturity date of the notes to march 17 , 2021 would require a principal payment in the aggregate amount of $ 2.0 million to be made in march 2020. the notes bore interest at a rate of 5.0 % per year through and including august 17 , 2017 and bear a rate of 6.0 % per year from and after august 18 , 2017. through and including june 18 , 2017 , all accrued and unpaid interest was payable semi-annually in arrears on each june 18 and december 18. after june 18 , 2017 , all accrued and unpaid interest is payable quarterly in arrears on each september 18 , december 18 , march 18 and june 18. the holder had the right to elect at any time on or prior to august 17 , 2017 to convert all or any portion of the outstanding principal amount of the notes . the holder 's conversion rights expired and are no longer subject to exercise . capital leases the company enters into capital lease arrangements from time to time , and the capital assets and obligations are recorded at the present value of minimum lease payments . the assets are included in property , plant and equipment , net on the consolidated balance sheets , and are depreciated over the respective lease terms which range from three to five years . the long-term component of the capital lease obligations is included in long-term debt and the current component is included in current portion of long-term debt . during 2017 , the company entered into capital lease agreements for which the net present value of the minimum lease payments , at inception , was $ 0.5 million . these amounts have been excluded from the consolidated statements of cash flows as they are non-cash . share-based activity we granted stock options and issued shares of our common stock to officers , employees , and non-employee directors during 2018 , 2017 and 2016 through our incentive compensation plans . refer to note 11 for further information . 24 contractual obligations at december 31 , 2018 , we had the following contractual principal , interest and purchase obligations : replace_table_token_14_th ( a ) amounts include interest expense , which was estimated based upon the december 31 , 2018 interest rate for our debt and assumes that debt will not be repaid until its maturity . the less than 1 year period includes a $ 2 million required principal payment on the notes in 2019. the 1-3 years period includes the maturity of the remaining $ 17 million of the notes . ( b ) purchase obligations include the value of all open purchase orders with established quantities and purchase prices as well as minimum purchase commitments and operating leases . contingent items product claims . we are subject to various claims and legal actions that arise in the normal course of conducting business . there were no material product claims outstanding at december 31 , 2018. environmental matters . we , as well as other steel companies , are subject to demanding environmental standards imposed by federal , state and local environmental laws and regulations . we are not aware of any environmental condition that currently exists at any of our facilities that are probable or reasonably possible of having a material impact on our results of operations or liquidity . we are aware of energy usage concerns relating to climate change ; however , we are not aware of any pending regulations that are expected to have a material impact on our results of operations or liquidity . legal matters . from time to time , various lawsuits and claims have been or may be asserted against us relating to the conduct of our business , including routine litigation relating to commercial and employment matters . the ultimate cost and outcome of any litigation or claim can not be predicted with certainty . management believes , based on information presently available , that the likelihood that the ultimate outcome of any such pending matter will have a material adverse effect on its financial condition , or liquidity or a material impact to its results of operations is remote , although the resolution of one or more of these matters may have a material adverse effect on its results of operations for the period in which the resolution occurs . critical accounting estimates the company 's revenues are primarily composed of sales of products . revenue from the sale of products is recognized when the company satisfies its performance obligation under a contract by transferring control of the promised product to its customer , which in most cases coincides with shipment of the related product . certain sales qualify for over-time revenue recognition . sales of certain specified product grades and shapes , and sales from conversion services , are recognized over-time . the company 's identification of and accounting for these sales is discussed further in note 2. management regularly monitors the ability to collect its unpaid sales invoices and the valuation of its receivables . the allowance for doubtful accounts includes specific reserves for the value of outstanding invoices issued to customers that are deemed potentially not collectible . inventories are stated at the lower of cost or net realizable value . the cost of inventory is principally determined by the weighted average cost method for material and operation costs . an inventory reserve is provided for material on hand for which management believes cost exceeds net realizable value . we reserve for slow-moving inventory and inventory that is being evaluated under our quality control process . the reserves are based upon management 's expected method of disposition . 25 property , plant and equipment ( “ pp

net cash provided by operating activities during 2018 , we generated net cash from operating activities of $ 16.6 million . our managed working capital , defined as net accounts receivable plus net inventory minus accounts payable , used $ 22.7 million of cash . inventories increased by $ 20.4 million to support increased demand and increased business activity . accounts receivable increased by $ 7.6 million due to increased sales in the fourth quarter of 2018 compared to the fourth quarter of the prior year . accounts payable increased by $ 5.3 million due to increased business activity levels and timing of payments . net income adjusted for non-cash expenses generated $ 32.8 million and all other operating activities generated $ 6.5 million of cash in 2018. during 2017 , we generated net cash from operating activities of $ 1.1 million . our managed working capital , defined as net accounts receivable plus net inventory minus accounts payable , used $ 18.8 million of cash from operations . inventories increased by $ 27.4 million primarily due to increased demand , accounts receivable increased by $ 5.6 million due to increased sales in the fourth quarter of 2017 , compared to the fourth quarter of 2016 , and accounts payable increased by $ 14.2 million due to increased activity levels in the fourth quarter of 2017 , compared to the fourth quarter of 2016. net income adjusted for non-cash expenses generated $ 20.3 million and all other operating activities used approximately $ 0.4 million of cash in 2017. net cash used in investing activities our capital spending was $ 15.4 million during 2018 and $ 8.0 million during 2017. the increase is due to strategic capital spending at our dunkirk , ny facility to install a new mid-size bar finishing operation . net cash used in financing activities during 2018 , financing activities provided $ 2.7 million in cash . we generated $ 32.2 million of cash through net proceeds from the equity offering , which we used to repay amounts outstanding under the company 's credit facility .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```net cash provided by operating activities during 2018 , we generated net cash from operating activities of $ 16.6 million . our managed working capital , defined as net accounts receivable plus net inventory minus accounts payable , used $ 22.7 million of cash . inventories increased by $ 20.4 million to support increased demand and increased business activity . accounts receivable increased by $ 7.6 million due to increased sales in the fourth quarter of 2018 compared to the fourth quarter of the prior year . accounts payable increased by $ 5.3 million due to increased business activity levels and timing of payments . net income adjusted for non-cash expenses generated $ 32.8 million and all other operating activities generated $ 6.5 million of cash in 2018. during 2017 , we generated net cash from operating activities of $ 1.1 million . our managed working capital , defined as net accounts receivable plus net inventory minus accounts payable , used $ 18.8 million of cash from operations . inventories increased by $ 27.4 million primarily due to increased demand , accounts receivable increased by $ 5.6 million due to increased sales in the fourth quarter of 2017 , compared to the fourth quarter of 2016 , and accounts payable increased by $ 14.2 million due to increased activity levels in the fourth quarter of 2017 , compared to the fourth quarter of 2016. net income adjusted for non-cash expenses generated $ 20.3 million and all other operating activities used approximately $ 0.4 million of cash in 2017. net cash used in investing activities our capital spending was $ 15.4 million during 2018 and $ 8.0 million during 2017. the increase is due to strategic capital spending at our dunkirk , ny facility to install a new mid-size bar finishing operation . net cash used in financing activities during 2018 , financing activities provided $ 2.7 million in cash . we generated $ 32.2 million of cash through net proceeds from the equity offering , which we used to repay amounts outstanding under the company 's credit facility . ``` Suspicious Activity Report : this represents the second consecutive year of gross margin expansion , after 2017 increased from 8.8 % of net sales in 2016. selling , general and administrative ( “ sg & a ” ) expenses increased by $ 2.9 million in 2018. the increase in sg & a was driven by higher employee related costs , including incentive compensation , associated with the increased business levels . overall , our operating income in 2018 was $ 16.1 million , compared to $ 4.2 million in 2017 , reflecting overall improved operational results . during 2018 , we generated $ 16.6 million of cash from operating activities , and used $ 15.4 million on capital expenditures , a significant portion of which was strategic capital spending related to finished bar production at our dunkirk facility . 15 our financing activities provide d net cash of $ 2.7 million . the company completed an equity offering in the second quarter of 2018 , which included the sale of 1 .4 million shares of common stock and raised $ 32.2 million of net proceeds . the proceeds were used to pay down our revolving cre dit facility . we entered into a new credit agreement that provide d a revolving credit facility of up to $ 110.0 million and a term loan facility of $ 10.0 million . we also entered into a new markets tax credit ( “ nmtc ” ) financing agreement , which provided low interest financing for our mid-size bar cell capital project at our dunkirk , ny facility . our operating facilities are integrated , and therefore our chief operating decision maker ( “ codm ” ) views the company as one business unit . our codm sets performance goals , assesses performance and makes decisions about resource allocations on a consolidated basis . as a result of these factors , as well as the nature of the financial information available which is reviewed by our codm , we maintain one reportable segment . results of operations 2018 results compared to 2017 replace_table_token_6_th 16 market segment information : replace_table_token_7_th melt type information : replace_table_token_8_th the majority of our products are sold to service centers rather than the ultimate end market customers . the end market information in this annual report is our estimate based upon our knowledge of our customers and the grade of material sold to them , which they will in-turn sell to the ultimate end market customer . end market information : replace_table_token_9_th net sales : net sales for the year ended december 31 , 2018 increased $ 53.3 million , or 26.3 % , compared to 2017. the increase in our sales reflects a 13.5 % increase in consolidated tons shipped , as demand for our products increased as a result of strengthening market conditions throughout 2018 , and a 11.3 % increase in sales dollars per shipped ton . the increase in sales dollars per shipped ton was driven by improved product mix , increased surcharges , and base price increases implemented during the year . 17 our product sales to all of our end markets except power generation increased as shown in the above table . our premium alloy sales reached a record level of $ 41.1 mill ion , or 16.1 % of total sales , for the year ended december 31 , 201 8 , compared to $ 27.3 million , or 13.5 % of total sales , for the year ended december 31 , 201 7 . our premium alloy sales are primarily for the a erospace end market . gross margin : our gross margin , as a percentage of net sales , increased to 14.8 % in 2018 from 11.4 % in 2017. the increase in gross margin is a result of better alignment of melt costs and surcharges for the majority of the current year , and the realization of manufacturing and productivity savings . gross margin in 2018 was adversely impacted toward the end of the year by the misalignment of customer surcharges and melt costs . selling , general and administrative expenses : our sg & a expenses consist primarily of employee costs including salaries , incentive compensation , payroll taxes and benefit related costs , legal and accounting services , share compensation and insurance costs . our sg & a expenses increased by $ 2.9 million for the year ended december 31 , 2018 compared to 2017. the increase is driven by higher employee related costs , including incentive compensation , consistent with increased business activity during the year . as a percentage of sales , our sg & a expenses were 8.5 % in 2018 compared to 9.3 % in 2017. interest expense and deferred financing amortization : our interest costs on our debt was $ 4.0 million for the years ended december 31 , 2018 and 2017. although our debt levels were substantially reduced for the second half of the 2018 , the variable interest rates charged on our credit agreement debt increased steadily throughout the year . the interest rate on our variable rate debt is determined by a libor-based rate plus an applicable margin based upon achieving certain ratios . other income : other income was $ 0.8 million in 2018 compared to less than $ 0.1 million in 2017. this increase is due to a favorable legal settlement of $ 0.7 million received in the second quarter of 2018. provision ( benefit ) from income taxes : the 2018 income tax provision is $ 1.9 million , compared to an income tax benefit of $ 7.6 million for 2017. the significant components of the current year tax provision include the federal statutory rate of 21 % , offset by the benefit of research and development tax credits . story_separator_special_tag million has been classified within current portion of long-term debt . additionally , the company has the option to further extend the maturity date of the notes to march 17 , 2021. extending the maturity date of the notes to march 17 , 2021 would require a principal payment in the aggregate amount of $ 2.0 million to be made in march 2020. the notes bore interest at a rate of 5.0 % per year through and including august 17 , 2017 and bear a rate of 6.0 % per year from and after august 18 , 2017. through and including june 18 , 2017 , all accrued and unpaid interest was payable semi-annually in arrears on each june 18 and december 18. after june 18 , 2017 , all accrued and unpaid interest is payable quarterly in arrears on each september 18 , december 18 , march 18 and june 18. the holder had the right to elect at any time on or prior to august 17 , 2017 to convert all or any portion of the outstanding principal amount of the notes . the holder 's conversion rights expired and are no longer subject to exercise . capital leases the company enters into capital lease arrangements from time to time , and the capital assets and obligations are recorded at the present value of minimum lease payments . the assets are included in property , plant and equipment , net on the consolidated balance sheets , and are depreciated over the respective lease terms which range from three to five years . the long-term component of the capital lease obligations is included in long-term debt and the current component is included in current portion of long-term debt . during 2017 , the company entered into capital lease agreements for which the net present value of the minimum lease payments , at inception , was $ 0.5 million . these amounts have been excluded from the consolidated statements of cash flows as they are non-cash . share-based activity we granted stock options and issued shares of our common stock to officers , employees , and non-employee directors during 2018 , 2017 and 2016 through our incentive compensation plans . refer to note 11 for further information . 24 contractual obligations at december 31 , 2018 , we had the following contractual principal , interest and purchase obligations : replace_table_token_14_th ( a ) amounts include interest expense , which was estimated based upon the december 31 , 2018 interest rate for our debt and assumes that debt will not be repaid until its maturity . the less than 1 year period includes a $ 2 million required principal payment on the notes in 2019. the 1-3 years period includes the maturity of the remaining $ 17 million of the notes . ( b ) purchase obligations include the value of all open purchase orders with established quantities and purchase prices as well as minimum purchase commitments and operating leases . contingent items product claims . we are subject to various claims and legal actions that arise in the normal course of conducting business . there were no material product claims outstanding at december 31 , 2018. environmental matters . we , as well as other steel companies , are subject to demanding environmental standards imposed by federal , state and local environmental laws and regulations . we are not aware of any environmental condition that currently exists at any of our facilities that are probable or reasonably possible of having a material impact on our results of operations or liquidity . we are aware of energy usage concerns relating to climate change ; however , we are not aware of any pending regulations that are expected to have a material impact on our results of operations or liquidity . legal matters . from time to time , various lawsuits and claims have been or may be asserted against us relating to the conduct of our business , including routine litigation relating to commercial and employment matters . the ultimate cost and outcome of any litigation or claim can not be predicted with certainty . management believes , based on information presently available , that the likelihood that the ultimate outcome of any such pending matter will have a material adverse effect on its financial condition , or liquidity or a material impact to its results of operations is remote , although the resolution of one or more of these matters may have a material adverse effect on its results of operations for the period in which the resolution occurs . critical accounting estimates the company 's revenues are primarily composed of sales of products . revenue from the sale of products is recognized when the company satisfies its performance obligation under a contract by transferring control of the promised product to its customer , which in most cases coincides with shipment of the related product . certain sales qualify for over-time revenue recognition . sales of certain specified product grades and shapes , and sales from conversion services , are recognized over-time . the company 's identification of and accounting for these sales is discussed further in note 2. management regularly monitors the ability to collect its unpaid sales invoices and the valuation of its receivables . the allowance for doubtful accounts includes specific reserves for the value of outstanding invoices issued to customers that are deemed potentially not collectible . inventories are stated at the lower of cost or net realizable value . the cost of inventory is principally determined by the weighted average cost method for material and operation costs . an inventory reserve is provided for material on hand for which management believes cost exceeds net realizable value . we reserve for slow-moving inventory and inventory that is being evaluated under our quality control process . the reserves are based upon management 's expected method of disposition . 25 property , plant and equipment ( “ pp

these risks include , but are not limited to , intense competition , whether we can be successful in obtaining fda and other governmental clearance or approval for the sale of our product for all desired indications and whether there will be a demand for the viveve system , given that the cost of the procedure will likely not be reimbursed by the government or private health insurers . in addition , we will continue to require substantial funds to support our clinical trials and fund our efforts to expand regulatory clearance or approval for our products , including in the u.s. we can not be certain that any additional required financing will be available when needed or on terms which are favorable to us . as noted above , our operations to date have been primarily funded through the sales of our securities , bank term loans and loans from related parties . various factors , including our limited operating history with limited revenues to date and our limited ability to market and sell our products have resulted in limited working capital available to fund our operations . there are no assurances that we will be successful in securing additional financing in the future to fund our operations going forward . failure to generate sufficient cash flows from operations , raise additional capital or reduce certain discretionary spending could have a material adverse effect on our ability to achieve our intended business objectives . 39 recent events 2019 public offering and debt conversion in november 2019 , the company closed an underwritten public offering of units ( the “ november 2019 offering ” ) for gross proceeds of approximately $ 11,500,000 , which included the full exercise of the underwriter 's overallotment option to purchase additional shares and warrants . the net proceeds to the company , after deducting underwriting discounts and commissions and other offering expenses and payable by the company , were approximately $ 9,952,000. the offering comprised of : ( 1 ) class a units , priced at a public offering price of $ 1.55 per unit , with each unit consisting of one share of common stock , a series a warrant to purchase one share of common stock at an exercise price of $ 1.55 per share that expires on the first anniversary of the date of issuance and a series b warrant to purchase one share of common stock at an exercise price of $ 1.55 per share that expires on the fifth anniversary of the issuance ; and ( 2 ) class b units , priced at a public offering price of $ 1.55 per unit , with each unit consisting of one share of series a convertible preferred stock , convertible into one share of common stock , a series a warrant to purchase one share of common stock at an exercise price of $ 1.55 per share that expires on the first anniversary of the date of issuance and a series b warrant to purchase one share of common stock at an exercise price of $ 1.55 per share that expires on the fifth anniversary of the issuance . the securities comprising the units were immediately separable and were issued separately . a total of 1,945,943 shares of common stock , 5,497,593 shares of series a convertible preferred stock , series a warrants to purchase up to 7,419,353 shares of common stock , and series b warrants to purchase up to 7,419,353 shares of common stock were issued in the offering , including the full exercise of the over-allotment option . in november and december 2019 , the holders of series a preferred stock converted 600,000 shares and 3,021,237 shares into common stock , respectively . as of december 31 , 2019 , 1,852,173 remaining shares of series a convertible preferred stock were outstanding . in connection with the closing of the november 2019 offering , the company 's secured lender , affiliates of crg lp ( “ crg ” ) , converted approximately $ 28,981,000 of the outstanding principal amount under its term loan with crg ( plus accrued interest , the prepayment premium and the back-end fee applicable thereto ) , for an aggregate amount of converted debt obligations of approximately $ 31,300,000. the amounts converted into 31,300 shares of the newly authorized series b convertible preferred stock convertible into 20,457,516 shares of common stock following an increase in the company 's authorized stock . crg was also issued and warrants to purchase up to 9,893,776 shares of common stock exercisable following an increase in the company 's authorized stock at an exercise price of $ 1.836 per share . crg entered into a one year lock up agreement on all securities that it holds . reverse stock split the company effected a 1-for-100 reverse stock split of its common stock that became effective after the nasdaq capital market trading closed on september 18 , 2019. the reverse stock split uniformly affected all issued and outstanding shares of the company 's common stock . the reverse stock split did not alter any stockholder 's percentage ownership interest in the company , except to the extent that the reverse stock split results in fractional shares . no fractional shares were issued in connection with the reverse stock split . any fractional share that resulted from the reverse stock split was rounded down and stockholders were issued cash in lieu of such fractional share interest . the par value of the company 's common stock remained unchanged at $ 0.0001 per share after the reverse stock split . the number of authorized shares of common stock remained at 75 million . the reverse stock split proportionately affected the number of shares of common stock available for issuance under the company 's equity incentive plans . story_separator_special_tag the new u.s. commercial sales model is intended to lower up-front costs for customers and thus lower hurdles to adoption , increase placement rates , and improve profitability by significantly reducing selling time per unit . the new commercial sales model successfully increased physician adoption rates in the months following its implementation and is continuing to gain traction in the u.s. market . in december 2019 , viveve systems placed with new customers represented a higher monthly productivity rate per sales representative than any prior month in the company 's history . sale of viveve products outside of the u.s. will continue to be supported by the company 's current distributors without significant change to the international business model . 43 under the recurring revenue rental model , customers may lease the viveve system for a set initial term . after the initial term , the customer may purchase the viveve system , continue to pay a monthly rental amount or terminate the contract . the rental program is accounted for under the financial accounting standards board 's ( “ fasb ” ) accounting standards codification ( “ asc ” ) no . 2016-02 , leases ( topic 842 ) and meets the classification criteria for an operating lease . revenue from the rental program is included in revenue and is currently not a material amount . the viveve systems that are being leased are included in property and equipment , net and depreciated over their expected useful lives of 5 years . when other products ( “ non-lease components ” ) , such as single-use treatment tips or ancillary consumables , are included in the offering , the company follows the relevant guidance in asc topic 606 , revenue from contracts with customers , to determine how to allocate contractual consideration between the lease and non-lease components . strategic organizational realignment in january 2019 , the company implemented a strategic and organizational realignment plan ( the “ strategic organizational realignment ” ) to reduce operating expenses and prepare the company for expanded indications for its cmrf technology platform for improved sexual function and stress urinary incontinence in women . the strategic organizational realignment included a reduction in total headcount of approximately 40 full-time employees . it also included a nearly two-thirds reduction in the company 's direct sales organization , which has been repositioned to provide targeted market development activities to further expand awareness and adoption of viveve 's cmrf technology in the gynecology , urogynecology , and female sexual medicine specialties . the company 's current and prospective aesthetic medicine customers in the u.s. will be supported by a network of distributor partners under viveve 's direction . international commercial distribution will remain unchanged through viveve 's global network of distributor partners . the total restructuring costs for employee severance and other related termination benefits were approximately $ 742,000 and it was recorded in the quarter ended march 31 , 2019. this restructuring contributed to a reduction in our total operating expenses in the first quarter of 2019 as planned and additional operating cost savings occurred through the remainder of 2019. adoption of new accounting standard - leases the company adopted the fasb 's asc topic 842 , as of january 1 , 2019 , using the modified retrospective approach . the modified retrospective approach provides a method for recording existing leases at the beginning of the period of adoption . in addition , the company elected the package of practical expedients permitted under the transition guidance within the new standard , which among other things , allowed us to carry forward the historical lease classification and we elected the hindsight practical expedient to determine the lease term for existing leases . we determined that the renewal options for the facilities lease would be reasonably certain to be renewed and as such , included that renewal period in determining the expected lease term of that lease . the comparative information has not been restated and continues to be reported under the accounting standards in effect for those periods . adoption of the new standard resulted in the recording of operating lease right-of-use assets of $ 629,000 and operating lease liabilities of $ 629,000 , as of january 1 , 2019. impact of the novel coronavirus as of the filing of this annual report on form 10-k , china , south korea , the united states and most other countries face the outbreak of a novel highly transmissible and pathogenic coronavirus , which has resulted in a widespread global health crisis , adversely affected general commercial activity and the economies and financial markets of many countries , and is likely to also adversely affect our business , financial condition and results of operations . the extent to which the novel coronavirus impacts us will depend on future developments , which are highly uncertain and can not be accurately predicted , including new information which may emerge concerning the severity of the coronavirus and the actions to contain the coronavirus or treat its impact , among others . plan of operation we intend to increase our sales both internationally and in the u.s. market by seeking additional regulatory clearances or approvals for the sale and distribution of our products , identifying and training qualified distributors and expanding the scope of physicians who offer the viveve system to include plastic surgeons , general surgeons , urologists , and urogynecologists . in june 2019 , we transitioned from a capital equipment sales model to a recurring revenue rental model in the u.s. market . the new u.s. commercial sales model is intended to lower up-front costs for customers and thus lower hurdles to adoption , increase placement rates , and improve profitability by significantly reducing selling time per unit . sale of viveve products outside of the u.s. will continue to be supported by our international distributors . in addition , we intend to use the strategic relationships that we have developed

liquidity and capital resources comparison of the year ended december 31 , 2019 and 2018 at december 31 , 2019 , we had accumulated deficit of $ 197.9 million , $ 13.3 million in cash and cash equivalents and working capital of $ 15.9 million . during 2019 , we raised $ 16.3 million from the sale of common stock and convertible preferred stock and warrants . however , we used $ 31.2 million in cash for operations during the year ended december 31 , 2019. as of the date our financial statements for the year ended december 31 , 2019 are issued , we did not have sufficient cash to fund our operation through march 31 , 2021 , without additional financing and , therefore , we concluded there was substantial doubt about our ability to continue as a going concern within one year after the date the financial statements are issued . management currently believes that it will be necessary for us to raise additional funding . we may obtain additional funding in the future through the issuance of our common stock , or through other equity or debt financing . the failure to raise additional funding when needed could have a material adverse effect on our business and financial condition . we may not be able to obtain additional financing as needed on acceptable terms , or at all , which may require us to reduce our operating costs and other expenditures , including reductions of personnel , salaries and capital expenditures . alternatively , or in addition to such potential measures , we may elect to implement additional cost reduction actions as we may determine are necessary and in our best interests . any such actions undertaken might limit the company 's ability to achieve its strategic objectives .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```liquidity and capital resources comparison of the year ended december 31 , 2019 and 2018 at december 31 , 2019 , we had accumulated deficit of $ 197.9 million , $ 13.3 million in cash and cash equivalents and working capital of $ 15.9 million . during 2019 , we raised $ 16.3 million from the sale of common stock and convertible preferred stock and warrants . however , we used $ 31.2 million in cash for operations during the year ended december 31 , 2019. as of the date our financial statements for the year ended december 31 , 2019 are issued , we did not have sufficient cash to fund our operation through march 31 , 2021 , without additional financing and , therefore , we concluded there was substantial doubt about our ability to continue as a going concern within one year after the date the financial statements are issued . management currently believes that it will be necessary for us to raise additional funding . we may obtain additional funding in the future through the issuance of our common stock , or through other equity or debt financing . the failure to raise additional funding when needed could have a material adverse effect on our business and financial condition . we may not be able to obtain additional financing as needed on acceptable terms , or at all , which may require us to reduce our operating costs and other expenditures , including reductions of personnel , salaries and capital expenditures . alternatively , or in addition to such potential measures , we may elect to implement additional cost reduction actions as we may determine are necessary and in our best interests . any such actions undertaken might limit the company 's ability to achieve its strategic objectives . ``` Suspicious Activity Report : these risks include , but are not limited to , intense competition , whether we can be successful in obtaining fda and other governmental clearance or approval for the sale of our product for all desired indications and whether there will be a demand for the viveve system , given that the cost of the procedure will likely not be reimbursed by the government or private health insurers . in addition , we will continue to require substantial funds to support our clinical trials and fund our efforts to expand regulatory clearance or approval for our products , including in the u.s. we can not be certain that any additional required financing will be available when needed or on terms which are favorable to us . as noted above , our operations to date have been primarily funded through the sales of our securities , bank term loans and loans from related parties . various factors , including our limited operating history with limited revenues to date and our limited ability to market and sell our products have resulted in limited working capital available to fund our operations . there are no assurances that we will be successful in securing additional financing in the future to fund our operations going forward . failure to generate sufficient cash flows from operations , raise additional capital or reduce certain discretionary spending could have a material adverse effect on our ability to achieve our intended business objectives . 39 recent events 2019 public offering and debt conversion in november 2019 , the company closed an underwritten public offering of units ( the “ november 2019 offering ” ) for gross proceeds of approximately $ 11,500,000 , which included the full exercise of the underwriter 's overallotment option to purchase additional shares and warrants . the net proceeds to the company , after deducting underwriting discounts and commissions and other offering expenses and payable by the company , were approximately $ 9,952,000. the offering comprised of : ( 1 ) class a units , priced at a public offering price of $ 1.55 per unit , with each unit consisting of one share of common stock , a series a warrant to purchase one share of common stock at an exercise price of $ 1.55 per share that expires on the first anniversary of the date of issuance and a series b warrant to purchase one share of common stock at an exercise price of $ 1.55 per share that expires on the fifth anniversary of the issuance ; and ( 2 ) class b units , priced at a public offering price of $ 1.55 per unit , with each unit consisting of one share of series a convertible preferred stock , convertible into one share of common stock , a series a warrant to purchase one share of common stock at an exercise price of $ 1.55 per share that expires on the first anniversary of the date of issuance and a series b warrant to purchase one share of common stock at an exercise price of $ 1.55 per share that expires on the fifth anniversary of the issuance . the securities comprising the units were immediately separable and were issued separately . a total of 1,945,943 shares of common stock , 5,497,593 shares of series a convertible preferred stock , series a warrants to purchase up to 7,419,353 shares of common stock , and series b warrants to purchase up to 7,419,353 shares of common stock were issued in the offering , including the full exercise of the over-allotment option . in november and december 2019 , the holders of series a preferred stock converted 600,000 shares and 3,021,237 shares into common stock , respectively . as of december 31 , 2019 , 1,852,173 remaining shares of series a convertible preferred stock were outstanding . in connection with the closing of the november 2019 offering , the company 's secured lender , affiliates of crg lp ( “ crg ” ) , converted approximately $ 28,981,000 of the outstanding principal amount under its term loan with crg ( plus accrued interest , the prepayment premium and the back-end fee applicable thereto ) , for an aggregate amount of converted debt obligations of approximately $ 31,300,000. the amounts converted into 31,300 shares of the newly authorized series b convertible preferred stock convertible into 20,457,516 shares of common stock following an increase in the company 's authorized stock . crg was also issued and warrants to purchase up to 9,893,776 shares of common stock exercisable following an increase in the company 's authorized stock at an exercise price of $ 1.836 per share . crg entered into a one year lock up agreement on all securities that it holds . reverse stock split the company effected a 1-for-100 reverse stock split of its common stock that became effective after the nasdaq capital market trading closed on september 18 , 2019. the reverse stock split uniformly affected all issued and outstanding shares of the company 's common stock . the reverse stock split did not alter any stockholder 's percentage ownership interest in the company , except to the extent that the reverse stock split results in fractional shares . no fractional shares were issued in connection with the reverse stock split . any fractional share that resulted from the reverse stock split was rounded down and stockholders were issued cash in lieu of such fractional share interest . the par value of the company 's common stock remained unchanged at $ 0.0001 per share after the reverse stock split . the number of authorized shares of common stock remained at 75 million . the reverse stock split proportionately affected the number of shares of common stock available for issuance under the company 's equity incentive plans . story_separator_special_tag the new u.s. commercial sales model is intended to lower up-front costs for customers and thus lower hurdles to adoption , increase placement rates , and improve profitability by significantly reducing selling time per unit . the new commercial sales model successfully increased physician adoption rates in the months following its implementation and is continuing to gain traction in the u.s. market . in december 2019 , viveve systems placed with new customers represented a higher monthly productivity rate per sales representative than any prior month in the company 's history . sale of viveve products outside of the u.s. will continue to be supported by the company 's current distributors without significant change to the international business model . 43 under the recurring revenue rental model , customers may lease the viveve system for a set initial term . after the initial term , the customer may purchase the viveve system , continue to pay a monthly rental amount or terminate the contract . the rental program is accounted for under the financial accounting standards board 's ( “ fasb ” ) accounting standards codification ( “ asc ” ) no . 2016-02 , leases ( topic 842 ) and meets the classification criteria for an operating lease . revenue from the rental program is included in revenue and is currently not a material amount . the viveve systems that are being leased are included in property and equipment , net and depreciated over their expected useful lives of 5 years . when other products ( “ non-lease components ” ) , such as single-use treatment tips or ancillary consumables , are included in the offering , the company follows the relevant guidance in asc topic 606 , revenue from contracts with customers , to determine how to allocate contractual consideration between the lease and non-lease components . strategic organizational realignment in january 2019 , the company implemented a strategic and organizational realignment plan ( the “ strategic organizational realignment ” ) to reduce operating expenses and prepare the company for expanded indications for its cmrf technology platform for improved sexual function and stress urinary incontinence in women . the strategic organizational realignment included a reduction in total headcount of approximately 40 full-time employees . it also included a nearly two-thirds reduction in the company 's direct sales organization , which has been repositioned to provide targeted market development activities to further expand awareness and adoption of viveve 's cmrf technology in the gynecology , urogynecology , and female sexual medicine specialties . the company 's current and prospective aesthetic medicine customers in the u.s. will be supported by a network of distributor partners under viveve 's direction . international commercial distribution will remain unchanged through viveve 's global network of distributor partners . the total restructuring costs for employee severance and other related termination benefits were approximately $ 742,000 and it was recorded in the quarter ended march 31 , 2019. this restructuring contributed to a reduction in our total operating expenses in the first quarter of 2019 as planned and additional operating cost savings occurred through the remainder of 2019. adoption of new accounting standard - leases the company adopted the fasb 's asc topic 842 , as of january 1 , 2019 , using the modified retrospective approach . the modified retrospective approach provides a method for recording existing leases at the beginning of the period of adoption . in addition , the company elected the package of practical expedients permitted under the transition guidance within the new standard , which among other things , allowed us to carry forward the historical lease classification and we elected the hindsight practical expedient to determine the lease term for existing leases . we determined that the renewal options for the facilities lease would be reasonably certain to be renewed and as such , included that renewal period in determining the expected lease term of that lease . the comparative information has not been restated and continues to be reported under the accounting standards in effect for those periods . adoption of the new standard resulted in the recording of operating lease right-of-use assets of $ 629,000 and operating lease liabilities of $ 629,000 , as of january 1 , 2019. impact of the novel coronavirus as of the filing of this annual report on form 10-k , china , south korea , the united states and most other countries face the outbreak of a novel highly transmissible and pathogenic coronavirus , which has resulted in a widespread global health crisis , adversely affected general commercial activity and the economies and financial markets of many countries , and is likely to also adversely affect our business , financial condition and results of operations . the extent to which the novel coronavirus impacts us will depend on future developments , which are highly uncertain and can not be accurately predicted , including new information which may emerge concerning the severity of the coronavirus and the actions to contain the coronavirus or treat its impact , among others . plan of operation we intend to increase our sales both internationally and in the u.s. market by seeking additional regulatory clearances or approvals for the sale and distribution of our products , identifying and training qualified distributors and expanding the scope of physicians who offer the viveve system to include plastic surgeons , general surgeons , urologists , and urogynecologists . in june 2019 , we transitioned from a capital equipment sales model to a recurring revenue rental model in the u.s. market . the new u.s. commercial sales model is intended to lower up-front costs for customers and thus lower hurdles to adoption , increase placement rates , and improve profitability by significantly reducing selling time per unit . sale of viveve products outside of the u.s. will continue to be supported by our international distributors . in addition , we intend to use the strategic relationships that we have developed

we plan to report initial results from the phase 1 portion of the ongoing trial of zn-c3 at the aacr annual meeting in april 2021. in addition , we initiated a phase 1b clinical trial evaluating zn-c3 in combination with chemotherapy in patients with advanced ovarian cancer in the october 2020 and plan to initiate a phase 2 trial evaluating zn-c3 as monotherapy in patients with uterine serous carcinoma , or usc , in 2021. usc comprises 10 % , and has the highest mortality rate , of all endometrial cancers , with approximately 6,000 new cases and 4,500 deaths in the united states per year . we continue to actively evaluate other potential combinations for the future clinical development of zn-c3 , and intend to initiate two ( 2 ) additional phase 1 clinical trials evaluating zn-c3 in combination with chemotherapy and parp inhibitor in ovarian cancer and other targeted indications in 2021. zn-d5 —our other product candidate zn-d5 is a selective inhibitor of b-cell lymphoma 2 , or bcl-2 , initially in development for the treatment of hematological malignancies . we initiated a phase 1 clinical trial of zn-d5 in patients with acute myeloid leukemia , or aml , or b-cell lymphoma in october 2021. in addition , we intend to initiate a phase 1b clinical trial evaluating zn-d5 in combination with zn-c5 , our oral serd product candidate in patients with er+/her2- breast cancer in 2021. zn-e4 — zn-e4 is an irreversible inhibitor of epidermal growth factor receptor , or egfr , currently in a phase 1/2 clinical trial for the treatment of advanced non-small cell lung cancer , or nsclc . we expect to report initial results from the phase 1 portion of the ongoing trial of zn-e4 in 2021 we currently own worldwide development and commercialization rights to each of our product candidates , other than in select asian countries ( including china ) for each of zn-c5 , zn-c3 and zn-d5 , for which we have out-licensed these rights to 100 our majority-owned joint venture , zentera therapeutics ( cayman ) , ltd. , or zentera , and for zn-e4 for which we have out-licensed these rights to sciclone pharmaceuticals international ( cayman ) development ltd. zentera submitted an investigational new drug application , or ind , in china for zn-c5 in december 2020 , for zn-c3 in february 2021 and intends to submit for zn-d5 in 2021. other preclinical programs —we are also currently advancing multiple small molecule programs in preclinical development for other cancer indications , including select solid tumors and hematological malignancies . we are now in lead optimization for our fifth product candidate and plan to submit an ind to the fda in 2021. since our inception , our operations have been limited to organizing and staffing our company , business planning , raising capital , establishing our intellectual property portfolio and performing research and development of our product pipeline . we do not have any products approved for commercial sale and have not generated any revenues from product sales . in april 2020 , we completed our ipo and issued and sold approximately 10.6 million shares of our common stock at a public offering price of $ 18.00 per share , including approximately 1.4 million shares in connection with the full exercise of the underwriters ' option to purchase additional shares , resulting in net proceeds of approximately $ 172.4 million , after deducting underwriting discounts and commissions and offering expenses . in august 2020 , we completed a follow-on offering of our common stock and issued and sold approximately 4.7 million shares of our common stock at a public offering price of $ 35.00 per share , including approximately 0.6 million shares in connection with the full exercise of the underwriters ' option to purchase additional shares , resulting in net proceeds of approximately $ 155.2 million , after deducting underwriting discounts and commissions and offering expenses . we had cash , cash equivalents and marketable securities of $ 338.5 million as of december 31 , 2020. we believe that our existing cash , cash equivalents and marketable securities as of december 31 , 2020 will enable us to fund our operating expenses and capital expenditure requirements into 2023. we have based these estimates on assumptions that may prove to be imprecise , and we could utilize our available capital resources sooner than we expect . since inception , we have incurred significant operating losses . our net losses were $ 118.5 million and $ 46.4 million for the years ended december 31 , 2020 and 2019 , respectively . we had an accumulated deficit of $ 200.8 million as of december 31 , 2020. we expect to continue to incur significant expenses and operating losses for the foreseeable future . we will not generate revenue from product sales unless and until we successfully complete clinical development and obtain regulatory approval for our product candidates . in addition , if we obtain regulatory approval for any of our product candidates , we expect to incur significant expenses related to developing our commercialization capabilities to support product sales , marketing and distribution activities , either alone or in collaboration with others . furthermore , we expect to incur additional costs associated with operating as a public company , including significant legal , accounting , investor relations and other expenses that we did not incur as a private company . as a result , we will need to raise substantial additional capital to support our continuing operations and pursue our growth strategy . until such time as we can generate significant revenue from product sales , if ever , we plan to finance our operations through the sale of equity , debt financings or other capital sources , which may include collaborations with other companies or other strategic transactions . story_separator_special_tag these costs are included in unallocated research and development expenses in the table below . the following table summarizes our research and development expenses by product candidate or development program : 104 replace_table_token_10_th research and development activities are central to our business model . product candidates in later stages of clinical development generally have a higher development costs than those in earlier stages of clinical development , primarily due to the increased size and duration of later-stage clinical trials . we expect that our research and development expenses will continue to increase substantially for the foreseeable future and will comprise a larger percentage of our total expenses as we complete our ongoing clinical trials , initiate new clinical trials , continue to discover and develop additional product candidates and prepare regulatory filings for any product candidates that successfully complete clinical development . the successful development of our product candidates is highly uncertain . at this time , we can not determine with certainty the duration and costs of our existing and future clinical trials of our product candidates or any other product candidate we may develop or if , when , or to what extent we will generate revenue from the commercialization and sale of any product candidate for which we obtain marketing approval . we may never succeed in obtaining marketing approval for any product candidate . the duration , costs and timing of clinical trials and development of our product candidates and any other product candidate we may develop in the future will depend on a variety of factors , including : per patient trial costs ; the number of patients who enroll in each trial ; the number of trials required for approval ; the number of sites included in the trials ; the countries in which the trials are conducted ; the length of time required to enroll eligible patients ; the drop-out or discontinuation rates of patients ; any delays in clinical trials as a result of the covid-19 pandemic ; potential additional safety monitoring requested by regulatory agencies ; the duration of patient participation in the trials and follow-up ; the phase of development of the product candidate ; the efficacy and safety profile of the product candidate . uncertainties in clinical trial design and patient enrollment rates ; the actual probability of success for our product candidates , including the safety and efficacy , early clinical data , competition , manufacturing capability and commercial viability ; significant and changing government regulation and regulatory guidance ; the timing and receipt of any marketing approvals ; and the expense of filing , prosecuting , defending and enforcing any patent claims and other intellectual property rights . a change in the outcome of any of these variables with respect to the development of a product candidate could mean a significant change in the costs and timing associated with the development of that product candidate . for example , if the fda or another regulatory authority were to require us to conduct clinical trials beyond those that we anticipate will be required for the completion of clinical development of a product candidate , or if we experience significant delays in our clinical trials due to patient enrollment or other reasons , we would be required to expend significant additional financial resources and time on the completion of clinical development . general and administrative expenses general and administrative expenses consist primarily of salaries and other related costs , including stock-based compensation , for personnel in our executive , finance , business development and administrative functions . general and administrative expenses also include legal fees relating to intellectual property and corporate matters ; professional fees for 105 accounting , auditing , tax and consulting services ; insurance costs ; travel expenses ; and facility-related expenses , which include direct depreciation costs and allocated expenses for rent and maintenance of facilities and other operating costs . we expect that our general and administrative expenses will increase in the future as we increase our personnel headcount to support increased research and development activities relating to zn-c3 , zn-c5 , zn-d5 , zn-e4 , and any other product candidate we may develop . we also expect to incur increased expenses associated with being a public company , including costs of accounting , audit , legal , regulatory and tax-related services associated with maintaining compliance with nasdaq and sec requirements ; director and officer insurance costs ; and investor and public relations costs . interest income interest income consists of interest earned on cash and cash equivalents . we expect our interest income to increase due to the net proceeds from our ipo and august 2020 follow-on offering . income taxes since our inception , we and our corporate subsidiaries have generated cumulative federal , state and foreign net operating loss for which we have not recorded any net tax benefit due to uncertainty around utilizing these tax attributes within their respective carryforward periods . net loss attributable to noncontrolling interest since december 21 , 2017 , the date of our initial investment in kalyra pharmaceuticals , inc. , or kalyra , we have consolidated the financial results of our affiliate , kalyra . although we do not have a controlling interest in kalyra , we determined that kalyra was a variable interest entity , of which we were the primary beneficiary . for more information on the treatment of kalyra as a variable interest entity , please see note 3 to our audited consolidated financial statements included elsewhere in this annual report on form 10-k. results of operations comparison of years ended december 31 , 2020 and 2019 the following table summarizes our results of operations for the years ended december 31 , 2020 and 2019 , together with the changes in those items in dollars : replace_table_token_11_th revenue we did not generate any revenue for the years ended december 31 , 2020 and 2019 . 106 research and development expenses research

cash flows the following table summarizes our sources and uses of cash for the period presented : replace_table_token_12_th operating activities we have incurred losses since inception . net cash used in operating activities for the year ended december 31 , 2020 was $ 86.8 million , consisting primarily of our net loss of $ 118.5 million as we incurred expenses associated with research activities for our lead product candidates and incurred general and administrative expenses , and partially offset by changes in operating assets and liabilities of $ 7.8 million and non-cash adjustments of $ 23.9 million . net cash used in operating activities for the year ended december 31 , 2019 was $ 39.1 million , consisting primarily of our net loss of $ 46.4 million as we incurred expenses associated with research activities for our lead product candidates and incurred general and administrative expenses , and partially offset by changes in operating assets and liabilities of $ 6.5 million and non-cash adjustments of $ 0.7 million . investing activities net cash used in investing activities for the year ended december 31 , 2020 was $ 284.8 million was attributable to the net investment of excess cash of $ 284.1 million and the purchases of property and equipment of $ 0.8 million . net cash used in investing activities for the year ended december 31 , 2019 was $ 0.4 million consisting of purchases of property and equipment . financing activities 108 net cash provided by financing activities in the year ended december 31 , 2020 of $ 360.4 million relates to net proceeds from the completion of our initial public offering of $ 172.5 million , net proceeds from our follow-on offering of $ 155.9 million , net proceeds from the issuance of our series c convertible preferred units of $ 14.2 million , and contributions from noncontrolling interest owners of $ 18.4 million . net cash provided by financing activities in the year ended december 31 , 2019 of $ 81.8 million primarily relates to net proceeds from the issuance of our series c convertible preferred units .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```cash flows the following table summarizes our sources and uses of cash for the period presented : replace_table_token_12_th operating activities we have incurred losses since inception . net cash used in operating activities for the year ended december 31 , 2020 was $ 86.8 million , consisting primarily of our net loss of $ 118.5 million as we incurred expenses associated with research activities for our lead product candidates and incurred general and administrative expenses , and partially offset by changes in operating assets and liabilities of $ 7.8 million and non-cash adjustments of $ 23.9 million . net cash used in operating activities for the year ended december 31 , 2019 was $ 39.1 million , consisting primarily of our net loss of $ 46.4 million as we incurred expenses associated with research activities for our lead product candidates and incurred general and administrative expenses , and partially offset by changes in operating assets and liabilities of $ 6.5 million and non-cash adjustments of $ 0.7 million . investing activities net cash used in investing activities for the year ended december 31 , 2020 was $ 284.8 million was attributable to the net investment of excess cash of $ 284.1 million and the purchases of property and equipment of $ 0.8 million . net cash used in investing activities for the year ended december 31 , 2019 was $ 0.4 million consisting of purchases of property and equipment . financing activities 108 net cash provided by financing activities in the year ended december 31 , 2020 of $ 360.4 million relates to net proceeds from the completion of our initial public offering of $ 172.5 million , net proceeds from our follow-on offering of $ 155.9 million , net proceeds from the issuance of our series c convertible preferred units of $ 14.2 million , and contributions from noncontrolling interest owners of $ 18.4 million . net cash provided by financing activities in the year ended december 31 , 2019 of $ 81.8 million primarily relates to net proceeds from the issuance of our series c convertible preferred units . ``` Suspicious Activity Report : we plan to report initial results from the phase 1 portion of the ongoing trial of zn-c3 at the aacr annual meeting in april 2021. in addition , we initiated a phase 1b clinical trial evaluating zn-c3 in combination with chemotherapy in patients with advanced ovarian cancer in the october 2020 and plan to initiate a phase 2 trial evaluating zn-c3 as monotherapy in patients with uterine serous carcinoma , or usc , in 2021. usc comprises 10 % , and has the highest mortality rate , of all endometrial cancers , with approximately 6,000 new cases and 4,500 deaths in the united states per year . we continue to actively evaluate other potential combinations for the future clinical development of zn-c3 , and intend to initiate two ( 2 ) additional phase 1 clinical trials evaluating zn-c3 in combination with chemotherapy and parp inhibitor in ovarian cancer and other targeted indications in 2021. zn-d5 —our other product candidate zn-d5 is a selective inhibitor of b-cell lymphoma 2 , or bcl-2 , initially in development for the treatment of hematological malignancies . we initiated a phase 1 clinical trial of zn-d5 in patients with acute myeloid leukemia , or aml , or b-cell lymphoma in october 2021. in addition , we intend to initiate a phase 1b clinical trial evaluating zn-d5 in combination with zn-c5 , our oral serd product candidate in patients with er+/her2- breast cancer in 2021. zn-e4 — zn-e4 is an irreversible inhibitor of epidermal growth factor receptor , or egfr , currently in a phase 1/2 clinical trial for the treatment of advanced non-small cell lung cancer , or nsclc . we expect to report initial results from the phase 1 portion of the ongoing trial of zn-e4 in 2021 we currently own worldwide development and commercialization rights to each of our product candidates , other than in select asian countries ( including china ) for each of zn-c5 , zn-c3 and zn-d5 , for which we have out-licensed these rights to 100 our majority-owned joint venture , zentera therapeutics ( cayman ) , ltd. , or zentera , and for zn-e4 for which we have out-licensed these rights to sciclone pharmaceuticals international ( cayman ) development ltd. zentera submitted an investigational new drug application , or ind , in china for zn-c5 in december 2020 , for zn-c3 in february 2021 and intends to submit for zn-d5 in 2021. other preclinical programs —we are also currently advancing multiple small molecule programs in preclinical development for other cancer indications , including select solid tumors and hematological malignancies . we are now in lead optimization for our fifth product candidate and plan to submit an ind to the fda in 2021. since our inception , our operations have been limited to organizing and staffing our company , business planning , raising capital , establishing our intellectual property portfolio and performing research and development of our product pipeline . we do not have any products approved for commercial sale and have not generated any revenues from product sales . in april 2020 , we completed our ipo and issued and sold approximately 10.6 million shares of our common stock at a public offering price of $ 18.00 per share , including approximately 1.4 million shares in connection with the full exercise of the underwriters ' option to purchase additional shares , resulting in net proceeds of approximately $ 172.4 million , after deducting underwriting discounts and commissions and offering expenses . in august 2020 , we completed a follow-on offering of our common stock and issued and sold approximately 4.7 million shares of our common stock at a public offering price of $ 35.00 per share , including approximately 0.6 million shares in connection with the full exercise of the underwriters ' option to purchase additional shares , resulting in net proceeds of approximately $ 155.2 million , after deducting underwriting discounts and commissions and offering expenses . we had cash , cash equivalents and marketable securities of $ 338.5 million as of december 31 , 2020. we believe that our existing cash , cash equivalents and marketable securities as of december 31 , 2020 will enable us to fund our operating expenses and capital expenditure requirements into 2023. we have based these estimates on assumptions that may prove to be imprecise , and we could utilize our available capital resources sooner than we expect . since inception , we have incurred significant operating losses . our net losses were $ 118.5 million and $ 46.4 million for the years ended december 31 , 2020 and 2019 , respectively . we had an accumulated deficit of $ 200.8 million as of december 31 , 2020. we expect to continue to incur significant expenses and operating losses for the foreseeable future . we will not generate revenue from product sales unless and until we successfully complete clinical development and obtain regulatory approval for our product candidates . in addition , if we obtain regulatory approval for any of our product candidates , we expect to incur significant expenses related to developing our commercialization capabilities to support product sales , marketing and distribution activities , either alone or in collaboration with others . furthermore , we expect to incur additional costs associated with operating as a public company , including significant legal , accounting , investor relations and other expenses that we did not incur as a private company . as a result , we will need to raise substantial additional capital to support our continuing operations and pursue our growth strategy . until such time as we can generate significant revenue from product sales , if ever , we plan to finance our operations through the sale of equity , debt financings or other capital sources , which may include collaborations with other companies or other strategic transactions . story_separator_special_tag these costs are included in unallocated research and development expenses in the table below . the following table summarizes our research and development expenses by product candidate or development program : 104 replace_table_token_10_th research and development activities are central to our business model . product candidates in later stages of clinical development generally have a higher development costs than those in earlier stages of clinical development , primarily due to the increased size and duration of later-stage clinical trials . we expect that our research and development expenses will continue to increase substantially for the foreseeable future and will comprise a larger percentage of our total expenses as we complete our ongoing clinical trials , initiate new clinical trials , continue to discover and develop additional product candidates and prepare regulatory filings for any product candidates that successfully complete clinical development . the successful development of our product candidates is highly uncertain . at this time , we can not determine with certainty the duration and costs of our existing and future clinical trials of our product candidates or any other product candidate we may develop or if , when , or to what extent we will generate revenue from the commercialization and sale of any product candidate for which we obtain marketing approval . we may never succeed in obtaining marketing approval for any product candidate . the duration , costs and timing of clinical trials and development of our product candidates and any other product candidate we may develop in the future will depend on a variety of factors , including : per patient trial costs ; the number of patients who enroll in each trial ; the number of trials required for approval ; the number of sites included in the trials ; the countries in which the trials are conducted ; the length of time required to enroll eligible patients ; the drop-out or discontinuation rates of patients ; any delays in clinical trials as a result of the covid-19 pandemic ; potential additional safety monitoring requested by regulatory agencies ; the duration of patient participation in the trials and follow-up ; the phase of development of the product candidate ; the efficacy and safety profile of the product candidate . uncertainties in clinical trial design and patient enrollment rates ; the actual probability of success for our product candidates , including the safety and efficacy , early clinical data , competition , manufacturing capability and commercial viability ; significant and changing government regulation and regulatory guidance ; the timing and receipt of any marketing approvals ; and the expense of filing , prosecuting , defending and enforcing any patent claims and other intellectual property rights . a change in the outcome of any of these variables with respect to the development of a product candidate could mean a significant change in the costs and timing associated with the development of that product candidate . for example , if the fda or another regulatory authority were to require us to conduct clinical trials beyond those that we anticipate will be required for the completion of clinical development of a product candidate , or if we experience significant delays in our clinical trials due to patient enrollment or other reasons , we would be required to expend significant additional financial resources and time on the completion of clinical development . general and administrative expenses general and administrative expenses consist primarily of salaries and other related costs , including stock-based compensation , for personnel in our executive , finance , business development and administrative functions . general and administrative expenses also include legal fees relating to intellectual property and corporate matters ; professional fees for 105 accounting , auditing , tax and consulting services ; insurance costs ; travel expenses ; and facility-related expenses , which include direct depreciation costs and allocated expenses for rent and maintenance of facilities and other operating costs . we expect that our general and administrative expenses will increase in the future as we increase our personnel headcount to support increased research and development activities relating to zn-c3 , zn-c5 , zn-d5 , zn-e4 , and any other product candidate we may develop . we also expect to incur increased expenses associated with being a public company , including costs of accounting , audit , legal , regulatory and tax-related services associated with maintaining compliance with nasdaq and sec requirements ; director and officer insurance costs ; and investor and public relations costs . interest income interest income consists of interest earned on cash and cash equivalents . we expect our interest income to increase due to the net proceeds from our ipo and august 2020 follow-on offering . income taxes since our inception , we and our corporate subsidiaries have generated cumulative federal , state and foreign net operating loss for which we have not recorded any net tax benefit due to uncertainty around utilizing these tax attributes within their respective carryforward periods . net loss attributable to noncontrolling interest since december 21 , 2017 , the date of our initial investment in kalyra pharmaceuticals , inc. , or kalyra , we have consolidated the financial results of our affiliate , kalyra . although we do not have a controlling interest in kalyra , we determined that kalyra was a variable interest entity , of which we were the primary beneficiary . for more information on the treatment of kalyra as a variable interest entity , please see note 3 to our audited consolidated financial statements included elsewhere in this annual report on form 10-k. results of operations comparison of years ended december 31 , 2020 and 2019 the following table summarizes our results of operations for the years ended december 31 , 2020 and 2019 , together with the changes in those items in dollars : replace_table_token_11_th revenue we did not generate any revenue for the years ended december 31 , 2020 and 2019 . 106 research and development expenses research

revenue our product revenue is generated from sales to hospitals and other medical facilities that are served through a direct sales force , independent sales representatives and distributors in the united states , germany , the united kingdom , austria , ireland , switzerland , singapore , hong kong , malaysia , monaco , hungary , spain , australia , argentina , benelux , united arab emirates , italy and other markets . in order for surgeons to use our products , the medical facilities where these surgeons treat patients typically require us to enter into pricing agreements . the process of negotiating a pricing agreement can be lengthy and time-consuming , require extensive management time and may not be successful . revenue from sales of our products fluctuates principally based on the selling price of the joint replacement product , as the sales price of our products varies among hospitals and other medical facilities as well as health insurance coverage and reimbursement rates . in addition , our product revenue may fluctuate based on the product sales mix and mix of sales by geography . our product revenue from international sales can be significantly impacted by fluctuations in foreign currency exchange rates , as our sales are typically denominated in the local currency in the countries in which we sell our products . we expect our product revenue to fluctuate from quarter-to-quarter due to a variety of factors , including seasonality , as we have historically experienced lower sales in the summer months , the timing of the introduction of our new products , if any , and the impact of the buying patterns and implant volumes of medical facilities . ongoing royalty revenue is generated from our agreement with microport orthopedics inc. , a wholly owned subsidiary of microport scientific corporation , or collectively , microport . the license agreement with microport and our license agreement with wright medical group , inc. , its wholly owned subsidiary , also generated additional revenue , which was recognized through december 31 , 2017. both agreements were entered into in april 2015. historically , we have accounted for the agreements with wright medical and microport under asc 605-25 , multiple-element arrangements and staff accounting bulletin no . 104 , revenue recognition ( asc 605 ) . in accordance with asc 605 , we were required to identify and account for each of the separate units of accounting . we identified the relative selling price for each and then allocated the total consideration based on their relative values . in connection with these agreements , in april 2015 , we recognized in aggregate ( i ) back-owed royalties of $ 3.4 million as royalty revenue and ( ii ) the value attributable to the settlements of $ 0.2 million as other income . additionally , we recognized an initial $ 5.1 million in aggregate as deferred royalty revenue , to be recognized as royalty revenue ratably through the expiration of the last to expire of our patents and patent applications licensed to wright medical , which currently is expected to occur in 2027. on january 1 , 2018 , we adopted asc 606 , revenue from contracts with customers . our analysis of these contracts under asc 606 indicated that the licenses are functional and thus revenue should have been recognized in full upon the license execution date , which resulted in a $ 4.3 million adjustment to our opening balance of accumulated deficit . in addition , the ongoing royalty from microport , which was previously recognized as royalty revenue upon receipt of payment , is now recognized in the period the sale occurred , resulting in a $ 0.2 million adjustment to our opening balance of accumulated deficit . the license agreement with microport will expire upon the expiration of the last to expire of our patents and patent applications licensed to microport , which currently is expected to occur in 2031. cost of revenue we produce our computer-aided designs , or cad , in-house and in india and use them to direct most of our product manufacturing efforts . we manufacture all of our patient-specific instruments , or ijigs , tibial trays , polyethylene tibia tray inserts used in our total knee implants , and our patient-specific conformis hip system implants in our facility in wilmington , massachusetts . we polish our femoral implants used in our total and partial knee products in our facility in wallingford , connecticut . starting in 2019 , we began to manufacture the lateral partial tibial tray components in our facility in wilmington , massachusetts . we outsource the production of the remainder of the partial knee tibial components , femoral castings , and other knee and hip components to third-party suppliers . our suppliers make our personalized implant components using the cad designs we supply . cost of revenue consists primarily of costs of raw materials , manufacturing personnel , outsourced cad labor , manufacturing supplies , inbound freight , manufacturing overhead , and depreciation expense . 69 we calculate gross margin as revenue less cost of revenue divided by revenue . our gross margin has been and will continue to be affected by a variety of factors , including primarily volume of units produced , mix of product components manufactured by us versus sourced from third parties , our average selling price , the geographic mix of sales , product sales mix , the number of cancelled sales orders resulting in wasted implants , and royalty revenue . we expect our gross margin from the sale of our products , which excludes royalty revenue , to expand over time to the extent we are successful in reducing our manufacturing costs per unit and increasing our manufacturing efficiency as sales volume increases . story_separator_special_tag on june 25 , 2019 , we entered into a loan and security agreement ( the `` 2019 secured loan agreement `` ) with innovatus life sciences lending fund i , lp ( `` innovatus `` ) , as collateral agent and lender , east west bank and the other lenders party thereto from time to time ( collectively , the `` lenders `` ) , pursuant to which the lenders agreed to make term loans and revolving credit facility to the company to repay existing indebtedness , for working capital and general business purposes , in a principal amount of up to $ 30 million , comprised of a $ 20 million term loan and up to $ 10 million revolving credit facility . the company used $ 15 million of the proceeds from the debt financings to pay off its 2017 secured loan agreement with oxford and the remaining proceeds will be utilized to fund the operations of the business . in addition , innovatus purchased approximately $ 3 million of the company 's common stock at the previous day 's closing price . for further information regarding the 2017 secured loan agreement and the 2019 secured loan agreement , see “ note k —debt and notes payable ” in the financial statements and related notes appearing elsewhere in this annual report on form 10-k. 74 on september 30 , 2019 , we entered into an asset purchase agreement with howmedica osteonics corp. , a subsidiary of stryker corporation also known as stryker orthopaedics ( `` stryker `` ) . in connection with entering into the asset purchase agreement , we also entered into a development agreement , a license agreement , and other ancillary agreements contemplated by the asset purchase agreement with stryker . under the terms of the agreements , we agreed to sell and license to stryker certain assets relating to the company 's patient-specific instrumentation technology , and to develop , manufacture , and supply patient-specific instrumentation for use in connection with stryker 's `` off-the-shelf `` non-personalized knee implant offerings . we received $ 14 million upfront and will receive up to an additional $ 16 million in milestone payments pursuant to the license agreement and the development agreement . as of december 2019 , we successfully completed one out of the three total milestones . we may be required to pay back a portion of the initial payment as it is contingent on successful completion of milestones set forth in the development and license agreements . under the long-term distribution agreement , we will supply patient-specific instrumentation to stryker . we expect to incur substantial expenditures in the foreseeable future in connection with the following : expansion of our sales and marketing efforts ; expansion of our manufacturing capacity ; funding research , development and clinical activities related to our existing products and product platform , including ifit design software and product support ; funding research , development and clinical activities related to new products that we may develop , including other joint replacement products ; pursuing and maintaining appropriate regulatory clearances and approvals for our existing products and any new products that we may develop ; and preparing , filing and prosecuting patent applications , and maintaining and enforcing our intellectual property rights and position . we anticipate that our principal sources of funds in the future will be revenue generated from the sale of our products , completion of the milestones set forth in the development agreement and license agreement with stryker , potential future capital raises through the issuance of equity or other securities , debt financings , and revenue that we may generate in connection with licensing our intellectual property . we will need to generate significant additional revenue to achieve and maintain profitability , and even if we achieve profitability , we can not be sure that we will remain profitable for any substantial period of time . it is also possible that we may allocate significant amounts of capital toward products or technologies for which market demand is lower than anticipated and , as a result , abandon such efforts . if we are unable to obtain adequate financing or financing on terms satisfactory to us when we require it , or if we expend capital on projects that are not successful , our ability to continue to support our business growth and to respond to business challenges could be significantly limited , and we may even have to scale back our operations . our failure to become and remain profitable could impair our ability to raise capital , expand our business , maintain our research and development efforts or continue to fund our operations . we anticipate needing to engage in additional equity or debt financings to secure additional funds . we may not be able to obtain additional financing on terms favorable to us , or at all . to the extent that we raise additional capital through the future sale of equity or debt , the ownership interest of our stockholders will be diluted . the terms of these future equity or debt securities may include liquidation or other preferences that adversely affect the rights of our existing common stockholders or involve negative covenants that restrict our ability to take specific actions , such as incurring additional debt or making capital expenditures . at december 31 , 2019 , we had cash and cash equivalents and investments of $ 26.4 million and $ 0.5 million in restricted cash allocated to lease deposits . based on our current operating plan , we expect that our existing cash and cash equivalents as of december 31 , 2019 , anticipated revenue from operations , our ability to issue equity to lpc , and our ability to draw down on the line of credit will enable us to fund our operating expenses and capital expenditure requirements and pay our debt service as it becomes due for at

cash flows the following table sets forth a summary of our cash flows for the periods indicated , as well as the year-over-year change ( in thousands ) : replace_table_token_3_th net cash used in operating activities . net cash used in operating activities was $ 2.8 million for the year ended december 31 , 2019 and $ 25.2 million for the year ended december 31 , 2018 , a decrease of $ 22.3 million . these amounts primarily reflect net losses of $ 28.5 million for the year ended december 31 , 2019 and $ 43.4 million for the year ended december 31 , 2018 . non-cash reconciling items between net loss and cash used in operations for the year ended december 31 , 2019 improved relative to december 31 , 2018 due to the goodwill impairment of $ 6.7 million and $ 2.4 million in other asset impairment that were recorded in 2018 , and stock-based compensation expense of $ 1.0 million , partially offset by a $ 1.5 million decrease from other non-cash items . the remaining change is related to decreases in our operating assets and liabilities , including contract liabilities of $ 12.0 million , and advances for research and development of $ 3.8 million related to the development agreement with stryker , accounts receivable of $ 2.0 million and $ 2.7 million from accounts payable and accrued liabilities . the decreases are partially offset by increases from prepaid and other assets of $ 2.2 million and inventory of $ 2.2 million . net cash provided by investing activities . net cash provided by investing activities was $ 4.3 million for the year ended december 31 , 2019 compared to $ 15.6 million cash provided by investing activities for the year ended december 31 , 2018 , a decrease of $ 11.3 million . these amounts primarily reflect a decrease of $ 12.4 million from the net purchase and maturity of investment securities classified as available-for-sale , along with a $ 1.1 million reduction in purchases of property and equipment . net cash provided by financing activities . net cash provided by financing activities was $ 8.5

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```cash flows the following table sets forth a summary of our cash flows for the periods indicated , as well as the year-over-year change ( in thousands ) : replace_table_token_3_th net cash used in operating activities . net cash used in operating activities was $ 2.8 million for the year ended december 31 , 2019 and $ 25.2 million for the year ended december 31 , 2018 , a decrease of $ 22.3 million . these amounts primarily reflect net losses of $ 28.5 million for the year ended december 31 , 2019 and $ 43.4 million for the year ended december 31 , 2018 . non-cash reconciling items between net loss and cash used in operations for the year ended december 31 , 2019 improved relative to december 31 , 2018 due to the goodwill impairment of $ 6.7 million and $ 2.4 million in other asset impairment that were recorded in 2018 , and stock-based compensation expense of $ 1.0 million , partially offset by a $ 1.5 million decrease from other non-cash items . the remaining change is related to decreases in our operating assets and liabilities , including contract liabilities of $ 12.0 million , and advances for research and development of $ 3.8 million related to the development agreement with stryker , accounts receivable of $ 2.0 million and $ 2.7 million from accounts payable and accrued liabilities . the decreases are partially offset by increases from prepaid and other assets of $ 2.2 million and inventory of $ 2.2 million . net cash provided by investing activities . net cash provided by investing activities was $ 4.3 million for the year ended december 31 , 2019 compared to $ 15.6 million cash provided by investing activities for the year ended december 31 , 2018 , a decrease of $ 11.3 million . these amounts primarily reflect a decrease of $ 12.4 million from the net purchase and maturity of investment securities classified as available-for-sale , along with a $ 1.1 million reduction in purchases of property and equipment . net cash provided by financing activities . net cash provided by financing activities was $ 8.5 ``` Suspicious Activity Report : revenue our product revenue is generated from sales to hospitals and other medical facilities that are served through a direct sales force , independent sales representatives and distributors in the united states , germany , the united kingdom , austria , ireland , switzerland , singapore , hong kong , malaysia , monaco , hungary , spain , australia , argentina , benelux , united arab emirates , italy and other markets . in order for surgeons to use our products , the medical facilities where these surgeons treat patients typically require us to enter into pricing agreements . the process of negotiating a pricing agreement can be lengthy and time-consuming , require extensive management time and may not be successful . revenue from sales of our products fluctuates principally based on the selling price of the joint replacement product , as the sales price of our products varies among hospitals and other medical facilities as well as health insurance coverage and reimbursement rates . in addition , our product revenue may fluctuate based on the product sales mix and mix of sales by geography . our product revenue from international sales can be significantly impacted by fluctuations in foreign currency exchange rates , as our sales are typically denominated in the local currency in the countries in which we sell our products . we expect our product revenue to fluctuate from quarter-to-quarter due to a variety of factors , including seasonality , as we have historically experienced lower sales in the summer months , the timing of the introduction of our new products , if any , and the impact of the buying patterns and implant volumes of medical facilities . ongoing royalty revenue is generated from our agreement with microport orthopedics inc. , a wholly owned subsidiary of microport scientific corporation , or collectively , microport . the license agreement with microport and our license agreement with wright medical group , inc. , its wholly owned subsidiary , also generated additional revenue , which was recognized through december 31 , 2017. both agreements were entered into in april 2015. historically , we have accounted for the agreements with wright medical and microport under asc 605-25 , multiple-element arrangements and staff accounting bulletin no . 104 , revenue recognition ( asc 605 ) . in accordance with asc 605 , we were required to identify and account for each of the separate units of accounting . we identified the relative selling price for each and then allocated the total consideration based on their relative values . in connection with these agreements , in april 2015 , we recognized in aggregate ( i ) back-owed royalties of $ 3.4 million as royalty revenue and ( ii ) the value attributable to the settlements of $ 0.2 million as other income . additionally , we recognized an initial $ 5.1 million in aggregate as deferred royalty revenue , to be recognized as royalty revenue ratably through the expiration of the last to expire of our patents and patent applications licensed to wright medical , which currently is expected to occur in 2027. on january 1 , 2018 , we adopted asc 606 , revenue from contracts with customers . our analysis of these contracts under asc 606 indicated that the licenses are functional and thus revenue should have been recognized in full upon the license execution date , which resulted in a $ 4.3 million adjustment to our opening balance of accumulated deficit . in addition , the ongoing royalty from microport , which was previously recognized as royalty revenue upon receipt of payment , is now recognized in the period the sale occurred , resulting in a $ 0.2 million adjustment to our opening balance of accumulated deficit . the license agreement with microport will expire upon the expiration of the last to expire of our patents and patent applications licensed to microport , which currently is expected to occur in 2031. cost of revenue we produce our computer-aided designs , or cad , in-house and in india and use them to direct most of our product manufacturing efforts . we manufacture all of our patient-specific instruments , or ijigs , tibial trays , polyethylene tibia tray inserts used in our total knee implants , and our patient-specific conformis hip system implants in our facility in wilmington , massachusetts . we polish our femoral implants used in our total and partial knee products in our facility in wallingford , connecticut . starting in 2019 , we began to manufacture the lateral partial tibial tray components in our facility in wilmington , massachusetts . we outsource the production of the remainder of the partial knee tibial components , femoral castings , and other knee and hip components to third-party suppliers . our suppliers make our personalized implant components using the cad designs we supply . cost of revenue consists primarily of costs of raw materials , manufacturing personnel , outsourced cad labor , manufacturing supplies , inbound freight , manufacturing overhead , and depreciation expense . 69 we calculate gross margin as revenue less cost of revenue divided by revenue . our gross margin has been and will continue to be affected by a variety of factors , including primarily volume of units produced , mix of product components manufactured by us versus sourced from third parties , our average selling price , the geographic mix of sales , product sales mix , the number of cancelled sales orders resulting in wasted implants , and royalty revenue . we expect our gross margin from the sale of our products , which excludes royalty revenue , to expand over time to the extent we are successful in reducing our manufacturing costs per unit and increasing our manufacturing efficiency as sales volume increases . story_separator_special_tag on june 25 , 2019 , we entered into a loan and security agreement ( the `` 2019 secured loan agreement `` ) with innovatus life sciences lending fund i , lp ( `` innovatus `` ) , as collateral agent and lender , east west bank and the other lenders party thereto from time to time ( collectively , the `` lenders `` ) , pursuant to which the lenders agreed to make term loans and revolving credit facility to the company to repay existing indebtedness , for working capital and general business purposes , in a principal amount of up to $ 30 million , comprised of a $ 20 million term loan and up to $ 10 million revolving credit facility . the company used $ 15 million of the proceeds from the debt financings to pay off its 2017 secured loan agreement with oxford and the remaining proceeds will be utilized to fund the operations of the business . in addition , innovatus purchased approximately $ 3 million of the company 's common stock at the previous day 's closing price . for further information regarding the 2017 secured loan agreement and the 2019 secured loan agreement , see “ note k —debt and notes payable ” in the financial statements and related notes appearing elsewhere in this annual report on form 10-k. 74 on september 30 , 2019 , we entered into an asset purchase agreement with howmedica osteonics corp. , a subsidiary of stryker corporation also known as stryker orthopaedics ( `` stryker `` ) . in connection with entering into the asset purchase agreement , we also entered into a development agreement , a license agreement , and other ancillary agreements contemplated by the asset purchase agreement with stryker . under the terms of the agreements , we agreed to sell and license to stryker certain assets relating to the company 's patient-specific instrumentation technology , and to develop , manufacture , and supply patient-specific instrumentation for use in connection with stryker 's `` off-the-shelf `` non-personalized knee implant offerings . we received $ 14 million upfront and will receive up to an additional $ 16 million in milestone payments pursuant to the license agreement and the development agreement . as of december 2019 , we successfully completed one out of the three total milestones . we may be required to pay back a portion of the initial payment as it is contingent on successful completion of milestones set forth in the development and license agreements . under the long-term distribution agreement , we will supply patient-specific instrumentation to stryker . we expect to incur substantial expenditures in the foreseeable future in connection with the following : expansion of our sales and marketing efforts ; expansion of our manufacturing capacity ; funding research , development and clinical activities related to our existing products and product platform , including ifit design software and product support ; funding research , development and clinical activities related to new products that we may develop , including other joint replacement products ; pursuing and maintaining appropriate regulatory clearances and approvals for our existing products and any new products that we may develop ; and preparing , filing and prosecuting patent applications , and maintaining and enforcing our intellectual property rights and position . we anticipate that our principal sources of funds in the future will be revenue generated from the sale of our products , completion of the milestones set forth in the development agreement and license agreement with stryker , potential future capital raises through the issuance of equity or other securities , debt financings , and revenue that we may generate in connection with licensing our intellectual property . we will need to generate significant additional revenue to achieve and maintain profitability , and even if we achieve profitability , we can not be sure that we will remain profitable for any substantial period of time . it is also possible that we may allocate significant amounts of capital toward products or technologies for which market demand is lower than anticipated and , as a result , abandon such efforts . if we are unable to obtain adequate financing or financing on terms satisfactory to us when we require it , or if we expend capital on projects that are not successful , our ability to continue to support our business growth and to respond to business challenges could be significantly limited , and we may even have to scale back our operations . our failure to become and remain profitable could impair our ability to raise capital , expand our business , maintain our research and development efforts or continue to fund our operations . we anticipate needing to engage in additional equity or debt financings to secure additional funds . we may not be able to obtain additional financing on terms favorable to us , or at all . to the extent that we raise additional capital through the future sale of equity or debt , the ownership interest of our stockholders will be diluted . the terms of these future equity or debt securities may include liquidation or other preferences that adversely affect the rights of our existing common stockholders or involve negative covenants that restrict our ability to take specific actions , such as incurring additional debt or making capital expenditures . at december 31 , 2019 , we had cash and cash equivalents and investments of $ 26.4 million and $ 0.5 million in restricted cash allocated to lease deposits . based on our current operating plan , we expect that our existing cash and cash equivalents as of december 31 , 2019 , anticipated revenue from operations , our ability to issue equity to lpc , and our ability to draw down on the line of credit will enable us to fund our operating expenses and capital expenditure requirements and pay our debt service as it becomes due for at

sales of shares of common stock under the atm program , if any , may be made in transactions that are deemed to be “ at the market ” offerings , as defined in rule 415 under the securities act of 1933 , as amended , including , without limitation , sales made by means of ordinary brokers ' transactions on the new york stock exchange , to or through a market maker at market prices prevailing at the time of sale , at prices related to prevailing market prices or at negotiated prices based on prevailing market prices . in addition to the issuance and sale of shares of common stock , the company may enter into forward sale agreements with each of jefferies and raymond james , or their respective affiliates , through the atm program . during the three months ended december 31 , 2019 , the company issued 445,835 shares of common stock at an average price of $ 47.82 per share , for gross proceeds of approximately $ 21.3 million and paid approximately $ 0.3 million in fees to the sales agents . during the year ended december 31 , 2019 , the company issued 1,565,322 shares of common stock at an average price of $ 45.98 per share , for gross proceeds of approximately $ 72.0 million . the company paid approximately $ 1.1 million in fees to the sales agents with respect to such sales and incurred other issuance costs of approximately $ 1.0 million , both of which were netted against the gross proceeds and recorded in additional paid in capital . the atm program may be terminated by the company at any time and expires automatically once aggregate sales under the atm program reach $ 100,000,000 ( see note 8 to our consolidated financial statements ) . 42 we have elected to be taxed as a reit under sections 856 through 860 of the code , and expect to continue to qualify as a reit . to qualify as a reit , we must meet a number of organizational and operational requirements , including a requirement that we distribute at least 90 % of our reit taxable income to our sto ckholders . as a reit , we will be subject to federal income tax on our undistributed reit taxable income and net capital gain and to a 4 % nondeductible excise tax on any amount by which distributions we pay with respect to any calendar year are less than th e sum of ( 1 ) 85 % of our ordinary income , ( 2 ) 95 % of our capital gain net income and ( 3 ) 100 % of our undistributed income from prior years . we believe we qualify for taxation as a reit under the code , and we intend to continue to operate in such a manner , b ut no assurance can be given that we will operate in a manner so as to qualify as a reit . taxable income from certain non-reit activities is managed through a trs and is subject to applicable federal , state , and local income and margin taxes . we had no sig nificant taxes associated with our trs for the years ended december 31 , 2019 , 2018 and 2017 . components of our revenues and expenses revenues rental income . our earnings are primarily attributable to the rental revenue from our multifamily properties . we anticipate that the leases we enter into for our multifamily properties will typically be for one year or less on average . also included are utility reimbursements , late fees , pet fees , and other rental fees charged to tenants . other income . other income includes ancillary income earned from tenants such as non-refundable fees , application fees , laundry fees , cable tv income , and other miscellaneous fees charged to tenants . expenses property operating expenses . property operating expenses include property maintenance costs , salary and employee benefit costs , utilities , casualty-related expenses and recoveries and other property operating costs . real estate taxes and insurance . real estate taxes include the property taxes assessed by local and state authorities depending on the location of each property . insurance includes the cost of commercial , general liability , and other needed insurance for each property . property management fees . property management fees include fees paid to bh , our property manager , or other third party management companies for managing each property ( see note 10 to our consolidated financial statements ) . advisory and administrative fees . advisory and administrative fees include the fees paid to our adviser pursuant to the advisory agreement ( see note 11 to our consolidated financial statements ) . corporate general and administrative expenses . corporate general and administrative expenses include , but are not limited to , audit fees , legal fees , listing fees , board of director fees , equity-based compensation expense , investor relations costs and payments of reimbursements to our adviser for operating expenses . corporate general and administrative expenses and the advisory and administrative fees paid to our adviser ( including advisory and administrative fees on properties defined in the advisory agreement as new assets ) will not exceed 1.5 % of average real estate assets per calendar year ( or part thereof that the advisory agreement is in effect ) , calculated in accordance with the advisory agreement , or the expense cap . the expense cap does not limit the reimbursement by us of expenses related to securities offerings paid by our adviser . story_separator_special_tag the amount incurred during the years ended december 31 , 2018 and 2017 represents the maximum fe e allowed on properties defined as contributed assets under the advisory agreement plus approximately $ 2.1 million and $ 2.0 million , respectively , of advisory and administrative fees incurred on certain properties defined as new assets . for the year ended december 31 , 2018 , our adviser elected to voluntarily waive the advisory and administrative fees incurred on the eight properties we acquired subsequent to october 2016 , which totaled approximately $ 4.1 million . for the year ended december 31 , 2017 , our ad viser elected to voluntarily waive the advisory and administrative fees incurred on the five properties we acquired subsequent to october 2016 , which totaled approximately $ 2.4 million . the advisory and administrative fees waived by our adviser for the yea rs ended december 31 , 2018 and 2017 are considered to be permanently waived for the periods . our adviser is not contractually obligated to waive fees on new assets in the future and may cease waiving fees on new assets at its discretion . advisory and admin istrative fees may increase in future periods as we acquire additional properties , which will be classified as new assets . corporate general and administrative expenses . corporate general and administrative expenses were $ 7.8 million for the year ended december 31 , 2018 compared to $ 6.3 million for the year ended december 31 , 2017 , which was an increase of approximately $ 1.5 million . the increase between the periods was primarily due to approximately $ 4.2 million of equity-based compensation expense recognized during the year ended december 31 , 2018 related to the grants of restricted stock units to our directors , officers , employees and certain key employees of our adviser pursuant to our 2016 ltip , compared to $ 3.1 million of equity-based compensation expense recognized during the year ended december 31 , 2017 ( see note 8 to our consolidated financial statements ) . subject to the expense cap , corporate general and administrative expenses may increase in future periods as we acquire additional properties . property general and administrative expenses . property general and administrative expenses were $ 6.1 million for the year ended december 31 , 2018 compared to $ 6.2 million for the year ended december 31 , 2017 , which was a decrease of approximately $ 0.1 million . the decrease between the periods was primarily due to our acquisition and disposition activity in 2017 and 2018 and the timing of the transactions , as described above . depreciation and amortization . depreciation and amortization costs were $ 47.5 million for the year ended december 31 , 2018 compared to $ 48.8 million for the year ended december 31 , 2017 , which was a decrease of approximately $ 1.3 million . the decrease between the periods was primarily due to the amortization of intangible lease assets of $ 2.5 million related to four properties for the year ended december 31 , 2018 compared to $ 8.9 million related to seven properties for the year ended december 31 , 2017 , which was a decrease of approximately $ 6.4 million . the decrease between the periods was partially offset by a $ 5.1 million increase in depreciation expense , primarily due to our acquisition activity in 2017 and 2018 and the timing of the transactions , as described above . the amortization of intangible lease assets over a six-month period from the date of acquisition is expected to increase the amortization expense during the initial year of operations for each property . other income and expense interest expense . interest expense was $ 28.6 million for the year ended december 31 , 2018 compared to $ 29.6 million for the year ended december 31 , 2017 , which was a decrease of approximately $ 1.0 million . the decrease between the periods was primarily due to an increase in gain recognized related to the effective portion of changes in fair value of our interest rate swap derivatives designated as cash flow hedges of approximately $ 5.3 million ( see “ debt , derivatives and hedging activity – interest rate swap agreements ” below ) . the decrease between the periods was partially offset by an increase in interest on debt of approximately $ 4.6 million . the following table details the various costs included in interest expense for the years ended december 31 , 2018 and 2017 ( in thousands ) : replace_table_token_11_th ( 1 ) prior to our adoption of asu 2017-12 , derivatives and hedging ( topic 815 ) ( “ asu 2017-12 ” ) on january 1 , 2018 , the ineffective portion of changes in the fair value of our derivatives designated as cash flow hedges was recognized directly in net income ( loss ) as interest expense . the adoption of asu 2017-12 eliminates the separate measurement of effectiveness and ineffectiveness , and all changes in the fair value of derivatives that are designated as cash flow hedges are recorded directly in other comprehensive income ( “ oci ” ) . see notes 2 and 7 to our consolidated financial statements for additional information . 48 loss on extinguishment of debt and modification costs . loss on extinguishment of debt and modification costs was $ 3.6 mil lion for the year ended december 31 , 2018 compared to $ 5.7 million for the year ended december 31 , 2017 , which was a decrease of approximately $ 2.1 million . the decrease between the periods was primarily due to decreases in debt modification and other exti nguishment costs of approximately $ 1.5 million and prepayment penalties and defeasance costs of approximately $ 1.0 million . the following table details the various costs included in loss on extinguishment of debt and modification costs for the years ended december 31 , 2018

cash flows from operating activities . during the year ended december 31 , 2019 , net cash provided by operating activities was $ 51.4 million compared to net cash provided by operating activities of $ 41.7 million for the year ended december 31 , 2018. the change in cash flows from operating activities was mainly due to an increase in total revenues , partially offset by an increase in total property operating expenses . cash flows from investing activities . during the year ended december 31 , 2019 , net cash used in investing activities was $ 553.1 million compared to net cash used in investing activities of $ 135.2 million for the year ended december 31 , 2018. the change in cash flows from investing activities was mainly due to an increase in acquisitions , partially offset by an increase in dispositions . we sold six properties for net proceeds of approximately $ 286.5 million and acquired 11 properties for a combined purchase price of approximately $ 876.7 million during the period in 2019 ; we sold one property for net proceeds of approximately $ 29.6 million and acquired three properties for a combined purchase price of approximately $ 131.0 million during 2018. cash flows from financing activities . during the year ended december 31 , 2019 , net cash provided by financing activities was $ 529.8 million compared to net cash provided by financing activities of $ 93.4 million for the year ended december 31 , 2018. the change in cash flows from financing activities was mainly due to a net increase in debt of approximately $ 450.6 million between the periods . the year ended december 31 , 2018 as compared to the year ended december 31 , 2017 cash flows from operating activities .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```cash flows from operating activities . during the year ended december 31 , 2019 , net cash provided by operating activities was $ 51.4 million compared to net cash provided by operating activities of $ 41.7 million for the year ended december 31 , 2018. the change in cash flows from operating activities was mainly due to an increase in total revenues , partially offset by an increase in total property operating expenses . cash flows from investing activities . during the year ended december 31 , 2019 , net cash used in investing activities was $ 553.1 million compared to net cash used in investing activities of $ 135.2 million for the year ended december 31 , 2018. the change in cash flows from investing activities was mainly due to an increase in acquisitions , partially offset by an increase in dispositions . we sold six properties for net proceeds of approximately $ 286.5 million and acquired 11 properties for a combined purchase price of approximately $ 876.7 million during the period in 2019 ; we sold one property for net proceeds of approximately $ 29.6 million and acquired three properties for a combined purchase price of approximately $ 131.0 million during 2018. cash flows from financing activities . during the year ended december 31 , 2019 , net cash provided by financing activities was $ 529.8 million compared to net cash provided by financing activities of $ 93.4 million for the year ended december 31 , 2018. the change in cash flows from financing activities was mainly due to a net increase in debt of approximately $ 450.6 million between the periods . the year ended december 31 , 2018 as compared to the year ended december 31 , 2017 cash flows from operating activities . ``` Suspicious Activity Report : sales of shares of common stock under the atm program , if any , may be made in transactions that are deemed to be “ at the market ” offerings , as defined in rule 415 under the securities act of 1933 , as amended , including , without limitation , sales made by means of ordinary brokers ' transactions on the new york stock exchange , to or through a market maker at market prices prevailing at the time of sale , at prices related to prevailing market prices or at negotiated prices based on prevailing market prices . in addition to the issuance and sale of shares of common stock , the company may enter into forward sale agreements with each of jefferies and raymond james , or their respective affiliates , through the atm program . during the three months ended december 31 , 2019 , the company issued 445,835 shares of common stock at an average price of $ 47.82 per share , for gross proceeds of approximately $ 21.3 million and paid approximately $ 0.3 million in fees to the sales agents . during the year ended december 31 , 2019 , the company issued 1,565,322 shares of common stock at an average price of $ 45.98 per share , for gross proceeds of approximately $ 72.0 million . the company paid approximately $ 1.1 million in fees to the sales agents with respect to such sales and incurred other issuance costs of approximately $ 1.0 million , both of which were netted against the gross proceeds and recorded in additional paid in capital . the atm program may be terminated by the company at any time and expires automatically once aggregate sales under the atm program reach $ 100,000,000 ( see note 8 to our consolidated financial statements ) . 42 we have elected to be taxed as a reit under sections 856 through 860 of the code , and expect to continue to qualify as a reit . to qualify as a reit , we must meet a number of organizational and operational requirements , including a requirement that we distribute at least 90 % of our reit taxable income to our sto ckholders . as a reit , we will be subject to federal income tax on our undistributed reit taxable income and net capital gain and to a 4 % nondeductible excise tax on any amount by which distributions we pay with respect to any calendar year are less than th e sum of ( 1 ) 85 % of our ordinary income , ( 2 ) 95 % of our capital gain net income and ( 3 ) 100 % of our undistributed income from prior years . we believe we qualify for taxation as a reit under the code , and we intend to continue to operate in such a manner , b ut no assurance can be given that we will operate in a manner so as to qualify as a reit . taxable income from certain non-reit activities is managed through a trs and is subject to applicable federal , state , and local income and margin taxes . we had no sig nificant taxes associated with our trs for the years ended december 31 , 2019 , 2018 and 2017 . components of our revenues and expenses revenues rental income . our earnings are primarily attributable to the rental revenue from our multifamily properties . we anticipate that the leases we enter into for our multifamily properties will typically be for one year or less on average . also included are utility reimbursements , late fees , pet fees , and other rental fees charged to tenants . other income . other income includes ancillary income earned from tenants such as non-refundable fees , application fees , laundry fees , cable tv income , and other miscellaneous fees charged to tenants . expenses property operating expenses . property operating expenses include property maintenance costs , salary and employee benefit costs , utilities , casualty-related expenses and recoveries and other property operating costs . real estate taxes and insurance . real estate taxes include the property taxes assessed by local and state authorities depending on the location of each property . insurance includes the cost of commercial , general liability , and other needed insurance for each property . property management fees . property management fees include fees paid to bh , our property manager , or other third party management companies for managing each property ( see note 10 to our consolidated financial statements ) . advisory and administrative fees . advisory and administrative fees include the fees paid to our adviser pursuant to the advisory agreement ( see note 11 to our consolidated financial statements ) . corporate general and administrative expenses . corporate general and administrative expenses include , but are not limited to , audit fees , legal fees , listing fees , board of director fees , equity-based compensation expense , investor relations costs and payments of reimbursements to our adviser for operating expenses . corporate general and administrative expenses and the advisory and administrative fees paid to our adviser ( including advisory and administrative fees on properties defined in the advisory agreement as new assets ) will not exceed 1.5 % of average real estate assets per calendar year ( or part thereof that the advisory agreement is in effect ) , calculated in accordance with the advisory agreement , or the expense cap . the expense cap does not limit the reimbursement by us of expenses related to securities offerings paid by our adviser . story_separator_special_tag the amount incurred during the years ended december 31 , 2018 and 2017 represents the maximum fe e allowed on properties defined as contributed assets under the advisory agreement plus approximately $ 2.1 million and $ 2.0 million , respectively , of advisory and administrative fees incurred on certain properties defined as new assets . for the year ended december 31 , 2018 , our adviser elected to voluntarily waive the advisory and administrative fees incurred on the eight properties we acquired subsequent to october 2016 , which totaled approximately $ 4.1 million . for the year ended december 31 , 2017 , our ad viser elected to voluntarily waive the advisory and administrative fees incurred on the five properties we acquired subsequent to october 2016 , which totaled approximately $ 2.4 million . the advisory and administrative fees waived by our adviser for the yea rs ended december 31 , 2018 and 2017 are considered to be permanently waived for the periods . our adviser is not contractually obligated to waive fees on new assets in the future and may cease waiving fees on new assets at its discretion . advisory and admin istrative fees may increase in future periods as we acquire additional properties , which will be classified as new assets . corporate general and administrative expenses . corporate general and administrative expenses were $ 7.8 million for the year ended december 31 , 2018 compared to $ 6.3 million for the year ended december 31 , 2017 , which was an increase of approximately $ 1.5 million . the increase between the periods was primarily due to approximately $ 4.2 million of equity-based compensation expense recognized during the year ended december 31 , 2018 related to the grants of restricted stock units to our directors , officers , employees and certain key employees of our adviser pursuant to our 2016 ltip , compared to $ 3.1 million of equity-based compensation expense recognized during the year ended december 31 , 2017 ( see note 8 to our consolidated financial statements ) . subject to the expense cap , corporate general and administrative expenses may increase in future periods as we acquire additional properties . property general and administrative expenses . property general and administrative expenses were $ 6.1 million for the year ended december 31 , 2018 compared to $ 6.2 million for the year ended december 31 , 2017 , which was a decrease of approximately $ 0.1 million . the decrease between the periods was primarily due to our acquisition and disposition activity in 2017 and 2018 and the timing of the transactions , as described above . depreciation and amortization . depreciation and amortization costs were $ 47.5 million for the year ended december 31 , 2018 compared to $ 48.8 million for the year ended december 31 , 2017 , which was a decrease of approximately $ 1.3 million . the decrease between the periods was primarily due to the amortization of intangible lease assets of $ 2.5 million related to four properties for the year ended december 31 , 2018 compared to $ 8.9 million related to seven properties for the year ended december 31 , 2017 , which was a decrease of approximately $ 6.4 million . the decrease between the periods was partially offset by a $ 5.1 million increase in depreciation expense , primarily due to our acquisition activity in 2017 and 2018 and the timing of the transactions , as described above . the amortization of intangible lease assets over a six-month period from the date of acquisition is expected to increase the amortization expense during the initial year of operations for each property . other income and expense interest expense . interest expense was $ 28.6 million for the year ended december 31 , 2018 compared to $ 29.6 million for the year ended december 31 , 2017 , which was a decrease of approximately $ 1.0 million . the decrease between the periods was primarily due to an increase in gain recognized related to the effective portion of changes in fair value of our interest rate swap derivatives designated as cash flow hedges of approximately $ 5.3 million ( see “ debt , derivatives and hedging activity – interest rate swap agreements ” below ) . the decrease between the periods was partially offset by an increase in interest on debt of approximately $ 4.6 million . the following table details the various costs included in interest expense for the years ended december 31 , 2018 and 2017 ( in thousands ) : replace_table_token_11_th ( 1 ) prior to our adoption of asu 2017-12 , derivatives and hedging ( topic 815 ) ( “ asu 2017-12 ” ) on january 1 , 2018 , the ineffective portion of changes in the fair value of our derivatives designated as cash flow hedges was recognized directly in net income ( loss ) as interest expense . the adoption of asu 2017-12 eliminates the separate measurement of effectiveness and ineffectiveness , and all changes in the fair value of derivatives that are designated as cash flow hedges are recorded directly in other comprehensive income ( “ oci ” ) . see notes 2 and 7 to our consolidated financial statements for additional information . 48 loss on extinguishment of debt and modification costs . loss on extinguishment of debt and modification costs was $ 3.6 mil lion for the year ended december 31 , 2018 compared to $ 5.7 million for the year ended december 31 , 2017 , which was a decrease of approximately $ 2.1 million . the decrease between the periods was primarily due to decreases in debt modification and other exti nguishment costs of approximately $ 1.5 million and prepayment penalties and defeasance costs of approximately $ 1.0 million . the following table details the various costs included in loss on extinguishment of debt and modification costs for the years ended december 31 , 2018

in analyzing business trends , management considers a variety of performance and financial measures , including comparable sales and comparable guest count growth , systemwide sales growth and returns . constant currency results exclude the effects of foreign currency translation and are calculated by translating current year results at prior year average exchange rates . management reviews and analyzes business results in constant currencies and bases certain incentive compensation plans on these results because we believe this better represents the company 's underlying business trends . comparable sales and comparable guest counts are key performance indicators used within the retail industry and are indicative of acceptance of the company 's initiatives as well as local economic and consumer trends . increases or decreases in comparable sales and comparable guest counts represent the percent change in sales and transactions , respectively , from the same period in the prior year for all restaurants in operation at least thirteen months , including those temporarily closed . some of the reasons restaurants may be temporarily closed include reimaging or remodeling , rebuilding , road construction and natural disasters . comparable sales exclude the impact of currency translation . mcdonald 's reports on a calendar basis and therefore the comparability of the same month , quarter and year with the corresponding period of the prior year will be impacted by the mix of days . the number of weekdays and weekend days in a given timeframe can have a positive or negative impact on comparable sales and guest counts . the company refers to these impacts as calendar shift/trading day adjustments . in addition , the timing of holidays can impact comparable sales and guest counts . these impacts vary geographically due to consumer spending patterns and have the greatest effect on monthly comparable sales and guest counts while the annual impacts are typically minimal . in 2008 , there was an incremental full day of sales and guest counts due to leap year . systemwide sales include sales at all restaurants , whether operated by the company or by franchisees . while franchised sales are not recorded as revenues by the company , management believes the information is important in understanding the company 's financial performance because these sales are the basis on which the company calculates and records franchised revenues and are indicative of the financial health of the franchisee base . 10 return on incremental invested capital ( roiic ) is a measure reviewed by management over one-year and three-year time periods to evaluate the overall profitability of the business units , the effectiveness of capital deployed and the future allocation of capital . the return is calculated by dividing the change in operating income plus depreciation and amortization ( numerator ) by the adjusted cash used for investing activities ( denominator ) , primarily capital expenditures . the calculation uses a constant average foreign exchange rate over the periods included in the calculation . strategic direction and financial performance the strength of the alignment among the company , its franchisees and suppliers ( collectively referred to as the system ) has been key to mcdonald 's success . this business model enables mcdonald 's to deliver consistent , locally-relevant restaurant experiences to customers and be an integral part of the communities we serve . in addition , it facilitates our ability to identify , implement and scale innovative ideas that meet customers ' changing needs and preferences . mcdonald 's customer-focused plan to win—which concentrates on being better , not just bigger—provides a common framework for our global business yet allows for local adaptation . through the execution of initiatives surrounding the five elements of our plan to win—people , products , place , price and promotion—we have enhanced the restaurant experience for customers worldwide and grown comparable sales and customer visits in each of the last seven years . this plan , combined with financial discipline , has delivered strong results for our shareholders . we have exceeded our long-term , constant currency financial targets of average annual systemwide sales growth of 3 % to 5 % ; average annual operating income growth of 6 % to 7 % ; and annual returns on incremental invested capital in the high teens every year since the plan 's implementation in 2003 , after adjusting for the loss in 2007 from the latin america developmental license transaction . given the size and scope of our global business , we believe these financial targets are realistic and sustainable over time , keeping us focused on making the best decisions for the long-term benefit of our system . in 2010 , we continued to enhance the customer experience by remaining focused on the company 's key global success factors of branded affordability , menu variety and beverage choice , convenience including daypart expansion , ongoing restaurant reinvestment and operations excellence . initiatives around these factors successfully resonated with consumers driving increases in sales and customer visits despite challenging economies and a contracting informal eating out ( ieo ) market in many countries . as a result , every area of the world contributed to 2010 global comparable sales and guest counts , which increased 5.0 % and 4.9 % , respectively . growth in comparable sales is driven by the system 's ability to optimize guest count growth , product mix shifts and menu price changes . pricing actions reflect local market conditions , with a view to preserving and improving margins , while continuing to drive guest counts and market share gains . in general , the goal is to achieve a balanced contribution of price and guest counts to comparable sales growth . in the u.s. , we grew sales , guest counts , market share and restaurant cash flow , with comparable sales increasing for the 8th consecutive year , rising 3.8 % in 2010. these positive results were achieved despite a declining ieo market . story_separator_special_tag in 2008 , net income and diluted earnings per common share were $ 4.3 billion and $ 3.76. results benefited by a $ 109 million or $ 0.09 per share after tax gain on the sale of the company 's minority ownership interest in pret a manger , reflected in gain on sale of investment . the company repurchased 37.8 million shares of its stock for nearly $ 2.7 billion in 2010 and 50.3 million shares of its stock for $ 2.9 billion in 2009 , driving reductions of over 2 % and 3 % of total shares outstanding , respectively , net of stock option exercises . revenues the company 's revenues consist of sales by company-operated restaurants and fees from restaurants operated by franchisees . revenues from conventional franchised restaurants include rent and royalties based on a percent of sales along with minimum rent payments , and initial fees . revenues from franchised restaurants that are licensed to affiliates and developmental licensees include a royalty based on a percent of sales , and generally include initial fees . over the past three years , the company has continued to optimize its restaurant ownership mix , cash flow and returns through its refranchising strategy . the shift to a greater percent- age of franchised restaurants negatively impacted consolidated revenues as company-operated sales shifted to franchised sales , where the company receives rent and or royalties based on a percent of sales . in 2010 , constant currency revenue growth was driven by positive comparable sales . the impact of refranchising on consolidated revenues lessened because the number of company-operated restaurants sold to franchisees has declined compared with 2009 and 2008 , in line with our overall strategy . in 2009 , constant currency revenue growth was driven by positive comparable sales and expansion , partly offset by the impact of refranchising in certain of the company 's major markets . revenues replace_table_token_6_th in the u.s. , revenues in 2010 and 2009 were positively impacted by the ongoing appeal of our iconic core products and the success of new products , as well as continued focus on everyday value and convenience . new products introduced in 2010 included mccafé frappés and smoothies as well as the angus snack wraps , while new products introduced in 2009 included mccafé premium coffees and the angus third pounder . refranchising activity negatively impacted revenue growth in both years . europe 's constant currency increases in revenues in 2010 and 2009 were primarily driven by comparable sales increases in the u.k. , france and russia ( which is entirely company-operated ) as well as expansion in russia . these increases were partly offset by the impact of refranchising activity , primarily in the u.k. in 2010 and the u.k. and germany in 2009. in apmea , the constant currency increase in revenues in 2010 was primarily driven by comparable sales increases in china , australia and most other markets . the 2009 increase was primarily driven by comparable sales increases in australia and most other asian markets , partly offset by negative comparable sales in china . in addition , expansion in china contributed to the increases in both years . 15 the following tables present comparable sales and systemwide sales increases/ ( decreases ) : comparable sales increases replace_table_token_7_th on a consolidated basis , comparable guest counts increased 4.9 % , 1.4 % and 3.1 % in 2010 , 2009 and 2008 , respectively . systemwide sales increases/ ( decreases ) replace_table_token_8_th franchised sales are not recorded as revenues by the company , but are the basis on which the company calculates and records franchised revenues and are indicative of the health of the franchisee base . the following table presents franchised sales and the related increases : franchised sales replace_table_token_9_th restaurant margins franchised margins franchised margin dollars represent revenues from franchised restaurants less the company 's occupancy costs ( rent and depreciation ) associated with those sites . franchised margin dollars represented about two-thirds of the combined restaurant margins in 2010 , 2009 and 2008. franchised margin dollars increased $ 479 million or 8 % ( 8 % in constant currencies ) in 2010 and $ 254 million or 4 % ( 7 % in constant currencies ) in 2009. positive comparable sales were the primary driver of the constant currency growth in franchise margin dollars in both years . refranchising activity also contributed to the constant currency growth in franchise margin dollars in 2009 and to a lesser extent in 2010. franchised margins replace_table_token_10_th in the u.s. , the franchised margin percent increase in 2010 was primarily due to positive comparable sales . the 2009 decrease was due to additional depreciation primarily related to the company 's investment in the beverage initiative , partly offset by positive comparable sales . europe 's franchised margin percent decreased in 2010 and 2009 as positive comparable sales were more than offset by higher occupancy expenses , the cost of strategic brand and sales building initiatives and the refranchising strategy . in apmea , the franchised margin percent decrease in 2010 was primarily driven by foreign currency translation , mostly due to the stronger australian dollar . the franchised margin percent in apmea and other countries & corporate is higher relative to the u.s. and europe due to a larger proportion of developmental licensed and or affiliated restaurants where the company receives royalty income with no corresponding occupancy costs . company-operated margins company-operated margin dollars represent sales by company-operated restaurants less the operating costs of these restaurants . company-operated margin dollars increased $ 366 million or 13 % ( 12 % in constant currencies ) in 2010 and decreased $ 101 million or 3 % ( increased 3 % in constant currencies ) in 2009. positive comparable sales and lower commodity costs were the primary drivers of the constant currency growth in company-operated margin dollars and percent in 2010. positive comparable sales , partly offset

cash flows the company generates significant cash from its operations and has substantial credit availability and capacity to fund operating and discretionary spending such as capital expenditures , debt repayments , dividends and share repurchases . cash provided by operations totaled $ 6.3 billion and exceeded capital expenditures by $ 4.2 billion in 2010 , while cash provided by operations totaled $ 5.8 billion and exceeded capital expenditures by $ 3.8 billion in 2009. in 2010 , cash provided by operations increased $ 591 million or 10 % compared with 2009 primarily due to increased operating results . in 2009 , cash provided by operations decreased $ 166 million or 3 % compared with 2008 despite increased operating results , primarily due to higher income tax payments , higher noncash income items and the receipt of $ 143 million in 2008 related to the completion of an irs examination . cash used for investing activities totaled $ 2.1 billion in 2010 , an increase of $ 401 million compared with 2009. this reflects higher capital expenditures and lower proceeds from sales of investments and restaurant businesses . cash used for investing activities totaled $ 1.7 billion in 2009 , an increase of $ 31 million compared with 2008. this reflects lower proceeds from sales of investments , restaurant businesses and property , offset by lower capital expenditures , primarily in the u.s. cash used for financing activities totaled $ 3.7 billion in 2010 , a decrease of $ 692 million compared with 2009 , primarily due to higher net debt issuances , higher proceeds from stock option exercises and lower treasury stock purchases , partly offset by an increase in the common stock dividend .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```cash flows the company generates significant cash from its operations and has substantial credit availability and capacity to fund operating and discretionary spending such as capital expenditures , debt repayments , dividends and share repurchases . cash provided by operations totaled $ 6.3 billion and exceeded capital expenditures by $ 4.2 billion in 2010 , while cash provided by operations totaled $ 5.8 billion and exceeded capital expenditures by $ 3.8 billion in 2009. in 2010 , cash provided by operations increased $ 591 million or 10 % compared with 2009 primarily due to increased operating results . in 2009 , cash provided by operations decreased $ 166 million or 3 % compared with 2008 despite increased operating results , primarily due to higher income tax payments , higher noncash income items and the receipt of $ 143 million in 2008 related to the completion of an irs examination . cash used for investing activities totaled $ 2.1 billion in 2010 , an increase of $ 401 million compared with 2009. this reflects higher capital expenditures and lower proceeds from sales of investments and restaurant businesses . cash used for investing activities totaled $ 1.7 billion in 2009 , an increase of $ 31 million compared with 2008. this reflects lower proceeds from sales of investments , restaurant businesses and property , offset by lower capital expenditures , primarily in the u.s. cash used for financing activities totaled $ 3.7 billion in 2010 , a decrease of $ 692 million compared with 2009 , primarily due to higher net debt issuances , higher proceeds from stock option exercises and lower treasury stock purchases , partly offset by an increase in the common stock dividend . ``` Suspicious Activity Report : in analyzing business trends , management considers a variety of performance and financial measures , including comparable sales and comparable guest count growth , systemwide sales growth and returns . constant currency results exclude the effects of foreign currency translation and are calculated by translating current year results at prior year average exchange rates . management reviews and analyzes business results in constant currencies and bases certain incentive compensation plans on these results because we believe this better represents the company 's underlying business trends . comparable sales and comparable guest counts are key performance indicators used within the retail industry and are indicative of acceptance of the company 's initiatives as well as local economic and consumer trends . increases or decreases in comparable sales and comparable guest counts represent the percent change in sales and transactions , respectively , from the same period in the prior year for all restaurants in operation at least thirteen months , including those temporarily closed . some of the reasons restaurants may be temporarily closed include reimaging or remodeling , rebuilding , road construction and natural disasters . comparable sales exclude the impact of currency translation . mcdonald 's reports on a calendar basis and therefore the comparability of the same month , quarter and year with the corresponding period of the prior year will be impacted by the mix of days . the number of weekdays and weekend days in a given timeframe can have a positive or negative impact on comparable sales and guest counts . the company refers to these impacts as calendar shift/trading day adjustments . in addition , the timing of holidays can impact comparable sales and guest counts . these impacts vary geographically due to consumer spending patterns and have the greatest effect on monthly comparable sales and guest counts while the annual impacts are typically minimal . in 2008 , there was an incremental full day of sales and guest counts due to leap year . systemwide sales include sales at all restaurants , whether operated by the company or by franchisees . while franchised sales are not recorded as revenues by the company , management believes the information is important in understanding the company 's financial performance because these sales are the basis on which the company calculates and records franchised revenues and are indicative of the financial health of the franchisee base . 10 return on incremental invested capital ( roiic ) is a measure reviewed by management over one-year and three-year time periods to evaluate the overall profitability of the business units , the effectiveness of capital deployed and the future allocation of capital . the return is calculated by dividing the change in operating income plus depreciation and amortization ( numerator ) by the adjusted cash used for investing activities ( denominator ) , primarily capital expenditures . the calculation uses a constant average foreign exchange rate over the periods included in the calculation . strategic direction and financial performance the strength of the alignment among the company , its franchisees and suppliers ( collectively referred to as the system ) has been key to mcdonald 's success . this business model enables mcdonald 's to deliver consistent , locally-relevant restaurant experiences to customers and be an integral part of the communities we serve . in addition , it facilitates our ability to identify , implement and scale innovative ideas that meet customers ' changing needs and preferences . mcdonald 's customer-focused plan to win—which concentrates on being better , not just bigger—provides a common framework for our global business yet allows for local adaptation . through the execution of initiatives surrounding the five elements of our plan to win—people , products , place , price and promotion—we have enhanced the restaurant experience for customers worldwide and grown comparable sales and customer visits in each of the last seven years . this plan , combined with financial discipline , has delivered strong results for our shareholders . we have exceeded our long-term , constant currency financial targets of average annual systemwide sales growth of 3 % to 5 % ; average annual operating income growth of 6 % to 7 % ; and annual returns on incremental invested capital in the high teens every year since the plan 's implementation in 2003 , after adjusting for the loss in 2007 from the latin america developmental license transaction . given the size and scope of our global business , we believe these financial targets are realistic and sustainable over time , keeping us focused on making the best decisions for the long-term benefit of our system . in 2010 , we continued to enhance the customer experience by remaining focused on the company 's key global success factors of branded affordability , menu variety and beverage choice , convenience including daypart expansion , ongoing restaurant reinvestment and operations excellence . initiatives around these factors successfully resonated with consumers driving increases in sales and customer visits despite challenging economies and a contracting informal eating out ( ieo ) market in many countries . as a result , every area of the world contributed to 2010 global comparable sales and guest counts , which increased 5.0 % and 4.9 % , respectively . growth in comparable sales is driven by the system 's ability to optimize guest count growth , product mix shifts and menu price changes . pricing actions reflect local market conditions , with a view to preserving and improving margins , while continuing to drive guest counts and market share gains . in general , the goal is to achieve a balanced contribution of price and guest counts to comparable sales growth . in the u.s. , we grew sales , guest counts , market share and restaurant cash flow , with comparable sales increasing for the 8th consecutive year , rising 3.8 % in 2010. these positive results were achieved despite a declining ieo market . story_separator_special_tag in 2008 , net income and diluted earnings per common share were $ 4.3 billion and $ 3.76. results benefited by a $ 109 million or $ 0.09 per share after tax gain on the sale of the company 's minority ownership interest in pret a manger , reflected in gain on sale of investment . the company repurchased 37.8 million shares of its stock for nearly $ 2.7 billion in 2010 and 50.3 million shares of its stock for $ 2.9 billion in 2009 , driving reductions of over 2 % and 3 % of total shares outstanding , respectively , net of stock option exercises . revenues the company 's revenues consist of sales by company-operated restaurants and fees from restaurants operated by franchisees . revenues from conventional franchised restaurants include rent and royalties based on a percent of sales along with minimum rent payments , and initial fees . revenues from franchised restaurants that are licensed to affiliates and developmental licensees include a royalty based on a percent of sales , and generally include initial fees . over the past three years , the company has continued to optimize its restaurant ownership mix , cash flow and returns through its refranchising strategy . the shift to a greater percent- age of franchised restaurants negatively impacted consolidated revenues as company-operated sales shifted to franchised sales , where the company receives rent and or royalties based on a percent of sales . in 2010 , constant currency revenue growth was driven by positive comparable sales . the impact of refranchising on consolidated revenues lessened because the number of company-operated restaurants sold to franchisees has declined compared with 2009 and 2008 , in line with our overall strategy . in 2009 , constant currency revenue growth was driven by positive comparable sales and expansion , partly offset by the impact of refranchising in certain of the company 's major markets . revenues replace_table_token_6_th in the u.s. , revenues in 2010 and 2009 were positively impacted by the ongoing appeal of our iconic core products and the success of new products , as well as continued focus on everyday value and convenience . new products introduced in 2010 included mccafé frappés and smoothies as well as the angus snack wraps , while new products introduced in 2009 included mccafé premium coffees and the angus third pounder . refranchising activity negatively impacted revenue growth in both years . europe 's constant currency increases in revenues in 2010 and 2009 were primarily driven by comparable sales increases in the u.k. , france and russia ( which is entirely company-operated ) as well as expansion in russia . these increases were partly offset by the impact of refranchising activity , primarily in the u.k. in 2010 and the u.k. and germany in 2009. in apmea , the constant currency increase in revenues in 2010 was primarily driven by comparable sales increases in china , australia and most other markets . the 2009 increase was primarily driven by comparable sales increases in australia and most other asian markets , partly offset by negative comparable sales in china . in addition , expansion in china contributed to the increases in both years . 15 the following tables present comparable sales and systemwide sales increases/ ( decreases ) : comparable sales increases replace_table_token_7_th on a consolidated basis , comparable guest counts increased 4.9 % , 1.4 % and 3.1 % in 2010 , 2009 and 2008 , respectively . systemwide sales increases/ ( decreases ) replace_table_token_8_th franchised sales are not recorded as revenues by the company , but are the basis on which the company calculates and records franchised revenues and are indicative of the health of the franchisee base . the following table presents franchised sales and the related increases : franchised sales replace_table_token_9_th restaurant margins franchised margins franchised margin dollars represent revenues from franchised restaurants less the company 's occupancy costs ( rent and depreciation ) associated with those sites . franchised margin dollars represented about two-thirds of the combined restaurant margins in 2010 , 2009 and 2008. franchised margin dollars increased $ 479 million or 8 % ( 8 % in constant currencies ) in 2010 and $ 254 million or 4 % ( 7 % in constant currencies ) in 2009. positive comparable sales were the primary driver of the constant currency growth in franchise margin dollars in both years . refranchising activity also contributed to the constant currency growth in franchise margin dollars in 2009 and to a lesser extent in 2010. franchised margins replace_table_token_10_th in the u.s. , the franchised margin percent increase in 2010 was primarily due to positive comparable sales . the 2009 decrease was due to additional depreciation primarily related to the company 's investment in the beverage initiative , partly offset by positive comparable sales . europe 's franchised margin percent decreased in 2010 and 2009 as positive comparable sales were more than offset by higher occupancy expenses , the cost of strategic brand and sales building initiatives and the refranchising strategy . in apmea , the franchised margin percent decrease in 2010 was primarily driven by foreign currency translation , mostly due to the stronger australian dollar . the franchised margin percent in apmea and other countries & corporate is higher relative to the u.s. and europe due to a larger proportion of developmental licensed and or affiliated restaurants where the company receives royalty income with no corresponding occupancy costs . company-operated margins company-operated margin dollars represent sales by company-operated restaurants less the operating costs of these restaurants . company-operated margin dollars increased $ 366 million or 13 % ( 12 % in constant currencies ) in 2010 and decreased $ 101 million or 3 % ( increased 3 % in constant currencies ) in 2009. positive comparable sales and lower commodity costs were the primary drivers of the constant currency growth in company-operated margin dollars and percent in 2010. positive comparable sales , partly offset

in the year ended december 31 , 2014 , we recorded a gain of $ 5.7 million in electricity revenues related to these transactions . electricity segment revenues are also subject to seasonal variations and can be affected by higher-than-average ambient temperatures , as described below under “ seasonality ” . in addition , the revenues we report in our financial statements may show more variation due to our increased use of derivatives in connection with our variable price ppas and the accounting principles associated with our use of those derivatives . to comply with obligations under their respective ppas , certain of our project subsidiaries are structured as special purpose , bankruptcy remote entities and their assets and liabilities are ring-fenced , and such assets are not generally available to pay the corporate debt ( other than debt at the respective project subsidiary level ) . however , these project subsidiaries are allowed to pay dividends and make distributions to us of all available and unrestricted cash flows generated by their assets . revenues attributable to our product segment are based on the sale of equipment and the provision of various services to our customers . these revenues may vary from period to period because of the timing of our receipt of purchase orders and the progress of our execution of each project . our management assesses the performance of our two segments of operation differently . in the case of our electricity segment , when making decisions about potential acquisitions or the development of new projects , we typically focus on the internal rate of return of the relevant investment , technical and geological matters and other business considerations . we evaluate our operating power plants based on revenues and expenses , and our projects that are under development based on costs attributable to each such project . we evaluate the performance of our product segment based on the timely delivery of our products , performance quality of our products , revenues and expenses and costs actually incurred to complete customer orders compared to the costs originally budgeted for such orders . trends and uncertainties the geothermal industry in the united states has historically experienced significant growth followed by a consolidation of owners and operators of geothermal power plants . since 2001 , there has been increased demand for energy generated from geothermal resources in the united states as costs for electricity generated from geothermal resources have become more competitive . recently , much of this is attributable to legislative and regulatory requirements and incentives , such as state renewable portfolio standards and federal tax credits . the arra further encourages the use of geothermal energy through ptcs or itcs as well as cash grants ( which are discussed in more detail in the section entitled “ government grants and tax benefits ” below ) . in response , the geothermal industry in the united states has seen a wave of new entrants and , over the last several years , consolidation involving smaller developers . we believe that the future demand for energy generated from geothermal and other renewable resources in the united states will be driven by further commitment and implementation of renewable portfolio standards as well as the introduction of additional tax incentives . the trends that from time to time impact our operations are subject to market cycles . 88 although other trends , factors and uncertainties may impact our operations and financial condition , including many that we do not or can not foresee , we believe that our results of operations and financial condition for the foreseeable future will be primarily affected by the following trends , factors and uncertainties : ● we expect to continue to generate the majority of our revenues from our electricity segment through the sale of electricity from our power plants . all of our current revenues from the sale of electricity are derived from payments under long-term ppas related to fully-contracted power plants . we also intend to continue to pursue opportunities , as they arise in our recovered energy business , in the solar pv sector and in other forms of clean energy . ● our focus continues to be organic growth through exploration , development , construction of new projects and enhancements of existing power plants along with increasing operational efficiency of our operating portfolio . we expect that our investment in organic growth will increase our total generating capacity , consolidated revenues and operating income attributable to our electricity segment from year to year . in addition , we routinely look at acquisition opportunities . ● the continued awareness of climate change may result in significant changes in the business and regulatory environments , which may create business opportunities for us . in 2011 , the first phase of the epa “ tailoring rule ” took effect . the tailoring rule sets thresholds addressing the applicability of the permitting requirements under the clean air act 's prevention of significant deterioration and title v programs to certain major sources of ghg emissions . on june 23 , 2014 , the united states supreme court issued its decision in utility air regulatory group v. environmental protection agency et al . , no . 12-1146 , in part addressing the tailoring rule . as a result of this decision , the epa can no longer require stationary sources of greenhouse gas emissions to comply with requirements under the clean air act 's prevention of significant deterioration and title v programs solely because of emissions of greenhouse gases . story_separator_special_tag 92 the following table sets forth a breakdown of our revenues for the years indicated : replace_table_token_8_th geographic breakdown of revenues the following table sets forth the geographic breakdown of the revenues attributable to our electricity and product segments for the years indicated : replace_table_token_9_th seasonality the prices paid for the electricity generated by some of our domestic power plants pursuant to our ppas are subject to seasonal variations . the prices ( mainly for capacity ) paid for electricity under the ppas with southern california edison and pacific gas & electric in california for the heber 1 and 2 power plants in the heber complex , the mammoth complex , the ormesa complex , and the north brawley power plant are higher in the months of june through september . as a result , we receive , and expect to continue to receive in the future , higher revenues during such months . in the winter , our power plants produce more energy principally due to the lower ambient temperature , which has a favorable impact on our energy revenues . however , the higher payments payable by southern california edison and pacific gas & electric company in the summer months have a more significant impact on our revenues than that of the higher energy revenues generally generated in winter due to increased efficiency . as a result , our electricity revenues are generally higher in the summer than in the winter . breakdown of cost of revenues electricity segment the principal cost of revenues attributable to our operating power plants includes operation and maintenance expenses comprised of salaries and related employee benefits , equipment expenses , costs of parts and chemicals , costs related to third-party services , lease expenses , royalties , startup and auxiliary electricity purchases , property taxes , insurance and , for some of our projects , purchases of make-up water for use in our cooling towers and also depreciation and amortization . in our california power plants our principal cost of revenues also includes transmission charges and scheduling charges . some of these expenses , such as parts , third-party services and major maintenance , are not incurred on a regular basis . this results in fluctuations in our expenses and our results of operations for individual power plants from quarter to quarter . payments made to government agencies and private entities on account of site leases where plants are located are included in cost of revenues . royalty payments , included in cost of revenues , are made as compensation for the right to use certain geothermal resources and are paid as a percentage of the revenues derived from the associated geothermal rights . royalties constituted approximately 4.3 % and 4.2 % of electricity segment revenues for the years ended december 31 , 2014 and december 31 , 2013 , respectively . 93 product segment the principal cost of revenues attributable to our product segment includes materials , salaries and related employee benefits , expenses related to subcontracting activities , and transportation expenses . sales commissions to sales representatives are included in selling and marketing expenses . some of the principal expenses attributable to our product segment , such as a portion of the costs related to labor , utilities and other support services are fixed , while others , such as materials , construction , transportation and sales commissions , are variable and may fluctuate significantly , depending on market conditions . as a result , the cost of revenues attributable to our product segment , expressed as a percentage of total revenues , fluctuates . another reason for such fluctuation is that in responding to bids for our products , we price our products and services in relation to existing competition and other prevailing market conditions , which may vary substantially from order to order . cash and cash equivalents our cash and cash equivalents , as of december 31 , 2014 decreased to $ 40.2 million from $ 57.4 million as of december 31 , 2013. this decrease is principally due to : ( i ) our use of $ 158.8 million to fund capital expenditures ; ( ii ) a net change in restricted cash and cash equivalents of $ 42.2 million ; ( iii ) $ 12.9 million of cash used to repurchase portion of ormat funding llc ( ofc ) senior secured notes ; ( iv ) net repayment of $ 91.7 million used under our revolving credit lines with commercial banks ; ( v ) repayment of $ 111.2 million of long-term debt ; ( vi ) $ 11.3 million of cash paid to noncontrolling interest ; and ( vii ) $ 9.6 million cash dividend paid . this decrease was partially offset by : ( i ) an additional $ 140.0 million of proceeds from sale of series c senior secured notes in august 2014 by ofc2 to finance a portion of the construction costs of phase 2 of the mcginness hills facility as described below under “ non-recourse and limited-recourse third-party debt ” ; ( ii ) $ 220.9 million derived from operating activities during the year ended december 31 , 2014 ; ( iii ) cash grant of $ 27.4 million received from the u.s. treasury under section 1603 of the arra relating to our don a. campbell geothermal power plant and our g1 refurbishment power plant at the mammoth complex ; and ( iv ) $ 35.3 million cash received from the sale of the heber solar plant . our corporate borrowing capacity under committed lines of credit with different commercial banks as of december 31 , 2014 was $ 555.2 million , as described below in “ liquidity and capital resources ” , of which we have utilized $ 357.2 million as of december 31 , 2014. critical accounting estimates and assumptions our significant accounting policies are more fully described in note 1 to our consolidated financial statements set forth

liquidity impact of uncertain tax positions as discussed in note 18 to our consolidated financial statements set forth in item 8 of this annual report , we have a liability associated with unrecognized tax benefits and related interest and penalties in the amount of approximately $ 7.5 million as of december 31 , 2014. this liability is included in long-term liabilities in our consolidated balance sheet , because we generally do not anticipate that settlement of the liability will require payment of cash within the next twelve months . we are not able to reasonably estimate when we will make any cash payments required to settle this liability . dividend the following are the dividends declared by us during the past two years : replace_table_token_12_th historical cash flows the following table sets forth the components of our cash flows for the relevant periods indicated : replace_table_token_13_th 112 for the year ended december 31 , 2014 net cash provided by operating activities for the year ended december 31 , 2014 was $ 213.2 million , compared to $ 86.8 million for the year ended december 31 , 2013. the net increase of $ 126.5 million resulted primarily from ( i ) a decrease in receivables of $ 47.1 million in the year ended december 31 , 2014 , compared to an increase of $ 37.2 million in the year ended december 31 , 2013 , as a result of timing of collections from our customers ; ( ii ) an increase in billing in excess of costs and estimated earnings on uncompleted contracts , net of $ 10.2 million in our product segment in the year ended december 31 , 2014 , compared to a decrease of $ 29.1 million in the year ended december 31 , 2013 , as a result of timing in billing of our customers ; and ( iii ) the increase in cash inflow from higher

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```liquidity impact of uncertain tax positions as discussed in note 18 to our consolidated financial statements set forth in item 8 of this annual report , we have a liability associated with unrecognized tax benefits and related interest and penalties in the amount of approximately $ 7.5 million as of december 31 , 2014. this liability is included in long-term liabilities in our consolidated balance sheet , because we generally do not anticipate that settlement of the liability will require payment of cash within the next twelve months . we are not able to reasonably estimate when we will make any cash payments required to settle this liability . dividend the following are the dividends declared by us during the past two years : replace_table_token_12_th historical cash flows the following table sets forth the components of our cash flows for the relevant periods indicated : replace_table_token_13_th 112 for the year ended december 31 , 2014 net cash provided by operating activities for the year ended december 31 , 2014 was $ 213.2 million , compared to $ 86.8 million for the year ended december 31 , 2013. the net increase of $ 126.5 million resulted primarily from ( i ) a decrease in receivables of $ 47.1 million in the year ended december 31 , 2014 , compared to an increase of $ 37.2 million in the year ended december 31 , 2013 , as a result of timing of collections from our customers ; ( ii ) an increase in billing in excess of costs and estimated earnings on uncompleted contracts , net of $ 10.2 million in our product segment in the year ended december 31 , 2014 , compared to a decrease of $ 29.1 million in the year ended december 31 , 2013 , as a result of timing in billing of our customers ; and ( iii ) the increase in cash inflow from higher ``` Suspicious Activity Report : in the year ended december 31 , 2014 , we recorded a gain of $ 5.7 million in electricity revenues related to these transactions . electricity segment revenues are also subject to seasonal variations and can be affected by higher-than-average ambient temperatures , as described below under “ seasonality ” . in addition , the revenues we report in our financial statements may show more variation due to our increased use of derivatives in connection with our variable price ppas and the accounting principles associated with our use of those derivatives . to comply with obligations under their respective ppas , certain of our project subsidiaries are structured as special purpose , bankruptcy remote entities and their assets and liabilities are ring-fenced , and such assets are not generally available to pay the corporate debt ( other than debt at the respective project subsidiary level ) . however , these project subsidiaries are allowed to pay dividends and make distributions to us of all available and unrestricted cash flows generated by their assets . revenues attributable to our product segment are based on the sale of equipment and the provision of various services to our customers . these revenues may vary from period to period because of the timing of our receipt of purchase orders and the progress of our execution of each project . our management assesses the performance of our two segments of operation differently . in the case of our electricity segment , when making decisions about potential acquisitions or the development of new projects , we typically focus on the internal rate of return of the relevant investment , technical and geological matters and other business considerations . we evaluate our operating power plants based on revenues and expenses , and our projects that are under development based on costs attributable to each such project . we evaluate the performance of our product segment based on the timely delivery of our products , performance quality of our products , revenues and expenses and costs actually incurred to complete customer orders compared to the costs originally budgeted for such orders . trends and uncertainties the geothermal industry in the united states has historically experienced significant growth followed by a consolidation of owners and operators of geothermal power plants . since 2001 , there has been increased demand for energy generated from geothermal resources in the united states as costs for electricity generated from geothermal resources have become more competitive . recently , much of this is attributable to legislative and regulatory requirements and incentives , such as state renewable portfolio standards and federal tax credits . the arra further encourages the use of geothermal energy through ptcs or itcs as well as cash grants ( which are discussed in more detail in the section entitled “ government grants and tax benefits ” below ) . in response , the geothermal industry in the united states has seen a wave of new entrants and , over the last several years , consolidation involving smaller developers . we believe that the future demand for energy generated from geothermal and other renewable resources in the united states will be driven by further commitment and implementation of renewable portfolio standards as well as the introduction of additional tax incentives . the trends that from time to time impact our operations are subject to market cycles . 88 although other trends , factors and uncertainties may impact our operations and financial condition , including many that we do not or can not foresee , we believe that our results of operations and financial condition for the foreseeable future will be primarily affected by the following trends , factors and uncertainties : ● we expect to continue to generate the majority of our revenues from our electricity segment through the sale of electricity from our power plants . all of our current revenues from the sale of electricity are derived from payments under long-term ppas related to fully-contracted power plants . we also intend to continue to pursue opportunities , as they arise in our recovered energy business , in the solar pv sector and in other forms of clean energy . ● our focus continues to be organic growth through exploration , development , construction of new projects and enhancements of existing power plants along with increasing operational efficiency of our operating portfolio . we expect that our investment in organic growth will increase our total generating capacity , consolidated revenues and operating income attributable to our electricity segment from year to year . in addition , we routinely look at acquisition opportunities . ● the continued awareness of climate change may result in significant changes in the business and regulatory environments , which may create business opportunities for us . in 2011 , the first phase of the epa “ tailoring rule ” took effect . the tailoring rule sets thresholds addressing the applicability of the permitting requirements under the clean air act 's prevention of significant deterioration and title v programs to certain major sources of ghg emissions . on june 23 , 2014 , the united states supreme court issued its decision in utility air regulatory group v. environmental protection agency et al . , no . 12-1146 , in part addressing the tailoring rule . as a result of this decision , the epa can no longer require stationary sources of greenhouse gas emissions to comply with requirements under the clean air act 's prevention of significant deterioration and title v programs solely because of emissions of greenhouse gases . story_separator_special_tag 92 the following table sets forth a breakdown of our revenues for the years indicated : replace_table_token_8_th geographic breakdown of revenues the following table sets forth the geographic breakdown of the revenues attributable to our electricity and product segments for the years indicated : replace_table_token_9_th seasonality the prices paid for the electricity generated by some of our domestic power plants pursuant to our ppas are subject to seasonal variations . the prices ( mainly for capacity ) paid for electricity under the ppas with southern california edison and pacific gas & electric in california for the heber 1 and 2 power plants in the heber complex , the mammoth complex , the ormesa complex , and the north brawley power plant are higher in the months of june through september . as a result , we receive , and expect to continue to receive in the future , higher revenues during such months . in the winter , our power plants produce more energy principally due to the lower ambient temperature , which has a favorable impact on our energy revenues . however , the higher payments payable by southern california edison and pacific gas & electric company in the summer months have a more significant impact on our revenues than that of the higher energy revenues generally generated in winter due to increased efficiency . as a result , our electricity revenues are generally higher in the summer than in the winter . breakdown of cost of revenues electricity segment the principal cost of revenues attributable to our operating power plants includes operation and maintenance expenses comprised of salaries and related employee benefits , equipment expenses , costs of parts and chemicals , costs related to third-party services , lease expenses , royalties , startup and auxiliary electricity purchases , property taxes , insurance and , for some of our projects , purchases of make-up water for use in our cooling towers and also depreciation and amortization . in our california power plants our principal cost of revenues also includes transmission charges and scheduling charges . some of these expenses , such as parts , third-party services and major maintenance , are not incurred on a regular basis . this results in fluctuations in our expenses and our results of operations for individual power plants from quarter to quarter . payments made to government agencies and private entities on account of site leases where plants are located are included in cost of revenues . royalty payments , included in cost of revenues , are made as compensation for the right to use certain geothermal resources and are paid as a percentage of the revenues derived from the associated geothermal rights . royalties constituted approximately 4.3 % and 4.2 % of electricity segment revenues for the years ended december 31 , 2014 and december 31 , 2013 , respectively . 93 product segment the principal cost of revenues attributable to our product segment includes materials , salaries and related employee benefits , expenses related to subcontracting activities , and transportation expenses . sales commissions to sales representatives are included in selling and marketing expenses . some of the principal expenses attributable to our product segment , such as a portion of the costs related to labor , utilities and other support services are fixed , while others , such as materials , construction , transportation and sales commissions , are variable and may fluctuate significantly , depending on market conditions . as a result , the cost of revenues attributable to our product segment , expressed as a percentage of total revenues , fluctuates . another reason for such fluctuation is that in responding to bids for our products , we price our products and services in relation to existing competition and other prevailing market conditions , which may vary substantially from order to order . cash and cash equivalents our cash and cash equivalents , as of december 31 , 2014 decreased to $ 40.2 million from $ 57.4 million as of december 31 , 2013. this decrease is principally due to : ( i ) our use of $ 158.8 million to fund capital expenditures ; ( ii ) a net change in restricted cash and cash equivalents of $ 42.2 million ; ( iii ) $ 12.9 million of cash used to repurchase portion of ormat funding llc ( ofc ) senior secured notes ; ( iv ) net repayment of $ 91.7 million used under our revolving credit lines with commercial banks ; ( v ) repayment of $ 111.2 million of long-term debt ; ( vi ) $ 11.3 million of cash paid to noncontrolling interest ; and ( vii ) $ 9.6 million cash dividend paid . this decrease was partially offset by : ( i ) an additional $ 140.0 million of proceeds from sale of series c senior secured notes in august 2014 by ofc2 to finance a portion of the construction costs of phase 2 of the mcginness hills facility as described below under “ non-recourse and limited-recourse third-party debt ” ; ( ii ) $ 220.9 million derived from operating activities during the year ended december 31 , 2014 ; ( iii ) cash grant of $ 27.4 million received from the u.s. treasury under section 1603 of the arra relating to our don a. campbell geothermal power plant and our g1 refurbishment power plant at the mammoth complex ; and ( iv ) $ 35.3 million cash received from the sale of the heber solar plant . our corporate borrowing capacity under committed lines of credit with different commercial banks as of december 31 , 2014 was $ 555.2 million , as described below in “ liquidity and capital resources ” , of which we have utilized $ 357.2 million as of december 31 , 2014. critical accounting estimates and assumptions our significant accounting policies are more fully described in note 1 to our consolidated financial statements set forth

september 30th , a `` fy `` ) 2013 to $ 495.5 billion , excluding funding for military personnel . the dod budget was approximately $ 496 billion in fy 2014 and remains at a similar level in fy 2015. the dod base budget excludes funding for overseas contingency operations , such as afghanistan , iraq and syria , which are appropriated separately and are not currently subject to the bca . under the bca , funding for the dod base budget is expected to increase very modestly to approximately $ 500 billion for fy 2016. in the years beyond fy 2016 , the bca permits annual increases for dod base budget funding of about 2.4 % with such caps remaining in force through fy 2023. the administration has publicly signaled its intent to submit dod budget requests that are significantly higher than the bca caps , as it did in submitting the fy 2016 budget request and the associated fy 2016 future year defense program ( `` fydp `` ) on february 2 , 2015 with all years exceeding the caps under the bca . such levels of dod budget funding would require the congress to enact legislation to raise the bca caps . in the event dod appropriations exceed the bca caps in any fiscal year through fy 2023 , across-the-board sequestration would go into effect , as occurred in 2013. u.s. government appropriations have and likely will continue to be affected by larger u.s. government budgetary issues and related legislation . when a formal appropriation bill has not been signed into law before the end of the fiscal year , congress may pass a continuing resolution ( `` cr `` ) that authorizes agencies of the u.s. government to continue to operate , generally at the same funding levels from the prior year , but typically does not authorize new spending initiatives during this period . if congress fails to enact a cr , the u.s. government may shut down , which likely would result in the closure of government offices and furlough of government workers , as well as impact the availability of funds to pay its contractors for work performed . in addition , if the national debt reaches the statutory debt ceiling , which is currently expected to occur in the first half of 2015 , the congress must enact legislation to increase the statutory debt ceiling . if the congress fails to do so , then the u.s. government may default on its debts , which would likely have a material adverse effect on the global financial markets . in march 2014 , the pentagon submitted its fy 2015 budget request of approximately $ 496 billion , which was consistent with the bipartisan budget spending authorization . also in march 2014 , the pentagon published the quadrennial defense review ( `` qdr `` ) . both the pentagon 's fy 2015 budget request and the qdr provide important insight for future national security funding priorities and related programs , which include cyber security and warfare , unmanned systems , satellite communications , missile defense and electronic warfare . in september 2014 , the president signed a fy2015 continuing resolution ( `` cr `` ) that funded the government through december 11 , 2014. the bill set the discretionary funding level for the federal government during cr period at an annual rate of $ 1.012 trillion . in december 2014 , the u.s. congress and senate passed the fiscal year 2015 omnibus appropriations bill , consolidated and further continuing appropriations act , 2015 ( the `` 2015 appropriations act `` ) that totals $ 1.014 trillion in discretionary spending in compliance with the bipartisan murray-ryan budget agreement . the bill funds the government through september 30 , 2015. the department of defense appropriations act , 2015 , which is a part of the appropriations act , provides $ 554.2 billion in base and overseas contingency operation funding , compared to $ 572 billion enacted in fiscal year 2014 and $ 554.3 billion in the president 's budget request . the base budget appropriation is $ 496.1 billion with $ 64.2 billion for overseas contingency operations ( `` oco `` ) of the department of defense ( `` dod `` ) , compared to $ 85.2 billion for dod oco enacted in fiscal year 2014. consequently , the dod 's overall future spending levels remain uncertain , and we are unable to specifically predict potential changes to future dod budgets on our programs and the effect that the foregoing would have on our future financial performance and outlook . in the event that bca funding levels continue , or if other actions are taken to significantly reduce the dod budget , it is possible that such reductions and related cancellations or delays affecting our existing contracts or programs could have a significant impact on the operating results of our business . 36 current reporting segments the company historically operated in two reportable segments : kratos government solutions ( “ kgs ” ) and public safety & security ( “ pss ” ) . in the fourth quarter of 2014 , the company expanded the number of reportable segments to three as we separated the kgs segment into two reportable segments : kgs and unmanned systems ( “ us ” ) . as a result , the kgs reportable segment is comprised of an aggregation of kratos ' government solutions operating segments , including our electronic products , satellite communications , modular systems and rocket support operating segments . the new unmanned systems reportable segment consists of our unmanned aerial , ground , seaborne and command , control and communications system business . the kgs and us segments provide products , solutions and services primarily for mission critical national security priorities . story_separator_special_tag cost of revenues decreased from $ 710.6 million for the year ended december 29 , 2013 to $ 649.8 million for the year ended december 28 , 2014 . the $ 60.8 million decrease in cost of revenues was primarily a result of decreased revenue discussed above . gross margin declined from 25.2 % for the year ended december 29 , 2013 compared to 25.1 % for the year ended december 28 , 2014 . margins on services decreased from 24.4 % for the year ended december 29 , 2013 to 22.1 % for the year ended december 28 , 2014 , due primarily to an unfavorable mix of revenues and decreased margins in our pss segment . margins on product sales increased for the year ended december 29 , 2013 as compared to december 28 , 2014 from 26.0 % to 27.7 % , respectively , primarily as a result of a change in mix of products sold . margins in the kgs segment increased from 26.2 % for the year ended december 29 , 2013 to 27.4 % for the year ended december 28 , 2014 , primarily as a result of change in the mix of products sold . margins in the us segment increased from 19.4 % for the year ended december 29 , 2013 to 23.2 % for the year ended december 28 , 2014 , primarily as a result of increased costs recorded of approximately $ 5.5 million on certain aerial target contracts to reflect retrofits necessary to address design changes recorded in the year ended december 29 , 2013 , compared to net increased costs recorded of $ 3.1 million for similar retrofit related matters and a contract conversion adjustment on certain of our unmanned aerial platforms recorded in the year ended december 28 , 2014. margins in the pss segment decreased from 25.8 % for the year ended december 29 , 2013 to 19.3 % for the year ended december 28 , 2014 as a result of decreased service margins and due to costs incurred on two sizable projects , which were completed in 2014 or are near-completion , under which we are in the process of submitting or have submitted change orders to customers to reimburse us for the work we performed at our customers ' request , but for which we have not completed negotiations for such change orders , and therefore have not reflected the estimated value of these change orders in our revenues to date . selling , general and administrative expenses . selling , general and administrative expenses ( “ sg & a ” ) decreased $ 19.6 million from $ 193.0 million for the year ended december 29 , 2013 to $ 173.4 million for the year ended december 28 , 2014 . the decrease was primarily the result of a $ 13.7 million reduction of amortization of intangibles in 2014 , as a result of certain intangible assets being fully amortized , as well as cost reduction actions taken by the company . as a percentage of revenues , sg & a decreased from 20.3 % for fiscal 2013 to 20.0 % for fiscal 2014 . excluding amortization of intangibles of $ 36.2 million for the year ended december 29 , 2013 and amortization of intangibles of $ 22.5 million for the year ended december 28 , 2014 , sg & a increased as a percentage of revenues from 16.5 % to 17.4 % for the year ended december 29 , 2013 and december 28 , 2014 , respectively , primarily as a result of the decline in revenues discussed previously , and increased compliance costs including internal cyber security costs incurred to protect the company 's assets , and sarbanes oxley and audit compliance costs including internal audit and external audit costs . merger and acquisition related items . merger and acquisition expenses increased $ 4.0 million from a benefit of $ 3.8 million to $ 0.2 million expense for the years ended december 29 , 2013 and december 28 , 2014 , respectively . the benefit of $ 3.8 million in 2013 was due to the reduction in a $ 3.1 million liability as a result of our final settlement of our obligations related to former officers and directors of integral systems , inc. ( `` integral `` ) on july 1 , 2013 , as well as a $ 2.7 million settlement , net of associated legal fees , arising from a contract dispute with a former subcontractor of the company pursuant to a settlement agreement executed in december 2013. both of these benefits were offset partially by legal fees and settlements related to prior acquisitions . internal research and development ( ir & d ) expenses . ir & d expenses increased from $ 21.4 million for the year ended december 29 , 2013 to $ 23.0 million for the year ended december 28 , 2014 . as a percentage of revenues , ir & d increased from 2.3 % of revenues for the year ended december 29 , 2013 to 2.6 % of revenues for the year ended december 28 , 2014 as a result of certain investments the company made primarily related to new programs and platforms in the electronic products business , the unmanned systems area , and the satellite communications business . unused office space and other . the benefit of $ 2.4 million for the year ended december 29 , 2013 was due to a reduction in the excess facility accrual of office space at the columbia , maryland administrative facilities , partially offset by expenses related to workforce reductions as a result of cost reduction initiatives we implemented across the company . the expense of $ 1.7 million for the year ended december 28 , 2014 was primarily due to an estimated excess facility accrual of office space at our sacramento , california administrative facilities , as well as due to employee termination costs related

debt acquired in acquisition of herley we assumed a $ 10.0 million ten-year term loan with a bank in israel that herley entered into on september 16 , 2008 in connection with the acquisition of one of its wholly owned subsidiaries . the balance as of december 28 , 2014 was $ 3.8 million , and the loan is payable in quarterly installments of $ 0.3 million plus interest at libor plus a margin of 1.5 % . the loan agreement contains various covenants including a minimum net equity covenant as defined in the loan agreement . we were in compliance with the financial covenants of the loan agreement as of december 28 , 2014 . payments in connection with acquisitions in connection with our business acquisitions , we agreed to make additional future payments to sellers based on final purchase price adjustments and the expiration of certain indemnification obligations . pursuant to the provisions of topic 805 , such amounts are recorded at fair value on the acquisition date . the agreement and plan of merger entered into in connection with our acquisition of secureinfo provided that upon achievement of certain cash receipts , revenue and ebitda in 2011 , we were obligated to pay the former stockholders of secureinfo additional cash contingent consideration . in march 2012 , we paid $ 1.5 million related to this contingent consideration . pursuant to the terms of the agreement and plan of merger with dei services corporation entered into on august 9 , 2010 ( “ the dei agreement ” ) , upon achievement of certain cash receipts , revenue , ebitda and backlog amounts in 2010 , 2011 and 2012 , we were obligated to pay certain additional contingent consideration ( the “ dei contingent consideration ” ) . we have paid $ 5.0 million related to the dei contingent consideration , of which $ 2.5 million and $ 2.1 million was paid in april 2012 and april 2013 , respectively . off balance sheet arrangements we have no off-balance sheet arrangements as defined in regulation s-k , item 303 ( a ) ( 4 ) ( ii ) .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```debt acquired in acquisition of herley we assumed a $ 10.0 million ten-year term loan with a bank in israel that herley entered into on september 16 , 2008 in connection with the acquisition of one of its wholly owned subsidiaries . the balance as of december 28 , 2014 was $ 3.8 million , and the loan is payable in quarterly installments of $ 0.3 million plus interest at libor plus a margin of 1.5 % . the loan agreement contains various covenants including a minimum net equity covenant as defined in the loan agreement . we were in compliance with the financial covenants of the loan agreement as of december 28 , 2014 . payments in connection with acquisitions in connection with our business acquisitions , we agreed to make additional future payments to sellers based on final purchase price adjustments and the expiration of certain indemnification obligations . pursuant to the provisions of topic 805 , such amounts are recorded at fair value on the acquisition date . the agreement and plan of merger entered into in connection with our acquisition of secureinfo provided that upon achievement of certain cash receipts , revenue and ebitda in 2011 , we were obligated to pay the former stockholders of secureinfo additional cash contingent consideration . in march 2012 , we paid $ 1.5 million related to this contingent consideration . pursuant to the terms of the agreement and plan of merger with dei services corporation entered into on august 9 , 2010 ( “ the dei agreement ” ) , upon achievement of certain cash receipts , revenue , ebitda and backlog amounts in 2010 , 2011 and 2012 , we were obligated to pay certain additional contingent consideration ( the “ dei contingent consideration ” ) . we have paid $ 5.0 million related to the dei contingent consideration , of which $ 2.5 million and $ 2.1 million was paid in april 2012 and april 2013 , respectively . off balance sheet arrangements we have no off-balance sheet arrangements as defined in regulation s-k , item 303 ( a ) ( 4 ) ( ii ) . ``` Suspicious Activity Report : september 30th , a `` fy `` ) 2013 to $ 495.5 billion , excluding funding for military personnel . the dod budget was approximately $ 496 billion in fy 2014 and remains at a similar level in fy 2015. the dod base budget excludes funding for overseas contingency operations , such as afghanistan , iraq and syria , which are appropriated separately and are not currently subject to the bca . under the bca , funding for the dod base budget is expected to increase very modestly to approximately $ 500 billion for fy 2016. in the years beyond fy 2016 , the bca permits annual increases for dod base budget funding of about 2.4 % with such caps remaining in force through fy 2023. the administration has publicly signaled its intent to submit dod budget requests that are significantly higher than the bca caps , as it did in submitting the fy 2016 budget request and the associated fy 2016 future year defense program ( `` fydp `` ) on february 2 , 2015 with all years exceeding the caps under the bca . such levels of dod budget funding would require the congress to enact legislation to raise the bca caps . in the event dod appropriations exceed the bca caps in any fiscal year through fy 2023 , across-the-board sequestration would go into effect , as occurred in 2013. u.s. government appropriations have and likely will continue to be affected by larger u.s. government budgetary issues and related legislation . when a formal appropriation bill has not been signed into law before the end of the fiscal year , congress may pass a continuing resolution ( `` cr `` ) that authorizes agencies of the u.s. government to continue to operate , generally at the same funding levels from the prior year , but typically does not authorize new spending initiatives during this period . if congress fails to enact a cr , the u.s. government may shut down , which likely would result in the closure of government offices and furlough of government workers , as well as impact the availability of funds to pay its contractors for work performed . in addition , if the national debt reaches the statutory debt ceiling , which is currently expected to occur in the first half of 2015 , the congress must enact legislation to increase the statutory debt ceiling . if the congress fails to do so , then the u.s. government may default on its debts , which would likely have a material adverse effect on the global financial markets . in march 2014 , the pentagon submitted its fy 2015 budget request of approximately $ 496 billion , which was consistent with the bipartisan budget spending authorization . also in march 2014 , the pentagon published the quadrennial defense review ( `` qdr `` ) . both the pentagon 's fy 2015 budget request and the qdr provide important insight for future national security funding priorities and related programs , which include cyber security and warfare , unmanned systems , satellite communications , missile defense and electronic warfare . in september 2014 , the president signed a fy2015 continuing resolution ( `` cr `` ) that funded the government through december 11 , 2014. the bill set the discretionary funding level for the federal government during cr period at an annual rate of $ 1.012 trillion . in december 2014 , the u.s. congress and senate passed the fiscal year 2015 omnibus appropriations bill , consolidated and further continuing appropriations act , 2015 ( the `` 2015 appropriations act `` ) that totals $ 1.014 trillion in discretionary spending in compliance with the bipartisan murray-ryan budget agreement . the bill funds the government through september 30 , 2015. the department of defense appropriations act , 2015 , which is a part of the appropriations act , provides $ 554.2 billion in base and overseas contingency operation funding , compared to $ 572 billion enacted in fiscal year 2014 and $ 554.3 billion in the president 's budget request . the base budget appropriation is $ 496.1 billion with $ 64.2 billion for overseas contingency operations ( `` oco `` ) of the department of defense ( `` dod `` ) , compared to $ 85.2 billion for dod oco enacted in fiscal year 2014. consequently , the dod 's overall future spending levels remain uncertain , and we are unable to specifically predict potential changes to future dod budgets on our programs and the effect that the foregoing would have on our future financial performance and outlook . in the event that bca funding levels continue , or if other actions are taken to significantly reduce the dod budget , it is possible that such reductions and related cancellations or delays affecting our existing contracts or programs could have a significant impact on the operating results of our business . 36 current reporting segments the company historically operated in two reportable segments : kratos government solutions ( “ kgs ” ) and public safety & security ( “ pss ” ) . in the fourth quarter of 2014 , the company expanded the number of reportable segments to three as we separated the kgs segment into two reportable segments : kgs and unmanned systems ( “ us ” ) . as a result , the kgs reportable segment is comprised of an aggregation of kratos ' government solutions operating segments , including our electronic products , satellite communications , modular systems and rocket support operating segments . the new unmanned systems reportable segment consists of our unmanned aerial , ground , seaborne and command , control and communications system business . the kgs and us segments provide products , solutions and services primarily for mission critical national security priorities . story_separator_special_tag cost of revenues decreased from $ 710.6 million for the year ended december 29 , 2013 to $ 649.8 million for the year ended december 28 , 2014 . the $ 60.8 million decrease in cost of revenues was primarily a result of decreased revenue discussed above . gross margin declined from 25.2 % for the year ended december 29 , 2013 compared to 25.1 % for the year ended december 28 , 2014 . margins on services decreased from 24.4 % for the year ended december 29 , 2013 to 22.1 % for the year ended december 28 , 2014 , due primarily to an unfavorable mix of revenues and decreased margins in our pss segment . margins on product sales increased for the year ended december 29 , 2013 as compared to december 28 , 2014 from 26.0 % to 27.7 % , respectively , primarily as a result of a change in mix of products sold . margins in the kgs segment increased from 26.2 % for the year ended december 29 , 2013 to 27.4 % for the year ended december 28 , 2014 , primarily as a result of change in the mix of products sold . margins in the us segment increased from 19.4 % for the year ended december 29 , 2013 to 23.2 % for the year ended december 28 , 2014 , primarily as a result of increased costs recorded of approximately $ 5.5 million on certain aerial target contracts to reflect retrofits necessary to address design changes recorded in the year ended december 29 , 2013 , compared to net increased costs recorded of $ 3.1 million for similar retrofit related matters and a contract conversion adjustment on certain of our unmanned aerial platforms recorded in the year ended december 28 , 2014. margins in the pss segment decreased from 25.8 % for the year ended december 29 , 2013 to 19.3 % for the year ended december 28 , 2014 as a result of decreased service margins and due to costs incurred on two sizable projects , which were completed in 2014 or are near-completion , under which we are in the process of submitting or have submitted change orders to customers to reimburse us for the work we performed at our customers ' request , but for which we have not completed negotiations for such change orders , and therefore have not reflected the estimated value of these change orders in our revenues to date . selling , general and administrative expenses . selling , general and administrative expenses ( “ sg & a ” ) decreased $ 19.6 million from $ 193.0 million for the year ended december 29 , 2013 to $ 173.4 million for the year ended december 28 , 2014 . the decrease was primarily the result of a $ 13.7 million reduction of amortization of intangibles in 2014 , as a result of certain intangible assets being fully amortized , as well as cost reduction actions taken by the company . as a percentage of revenues , sg & a decreased from 20.3 % for fiscal 2013 to 20.0 % for fiscal 2014 . excluding amortization of intangibles of $ 36.2 million for the year ended december 29 , 2013 and amortization of intangibles of $ 22.5 million for the year ended december 28 , 2014 , sg & a increased as a percentage of revenues from 16.5 % to 17.4 % for the year ended december 29 , 2013 and december 28 , 2014 , respectively , primarily as a result of the decline in revenues discussed previously , and increased compliance costs including internal cyber security costs incurred to protect the company 's assets , and sarbanes oxley and audit compliance costs including internal audit and external audit costs . merger and acquisition related items . merger and acquisition expenses increased $ 4.0 million from a benefit of $ 3.8 million to $ 0.2 million expense for the years ended december 29 , 2013 and december 28 , 2014 , respectively . the benefit of $ 3.8 million in 2013 was due to the reduction in a $ 3.1 million liability as a result of our final settlement of our obligations related to former officers and directors of integral systems , inc. ( `` integral `` ) on july 1 , 2013 , as well as a $ 2.7 million settlement , net of associated legal fees , arising from a contract dispute with a former subcontractor of the company pursuant to a settlement agreement executed in december 2013. both of these benefits were offset partially by legal fees and settlements related to prior acquisitions . internal research and development ( ir & d ) expenses . ir & d expenses increased from $ 21.4 million for the year ended december 29 , 2013 to $ 23.0 million for the year ended december 28 , 2014 . as a percentage of revenues , ir & d increased from 2.3 % of revenues for the year ended december 29 , 2013 to 2.6 % of revenues for the year ended december 28 , 2014 as a result of certain investments the company made primarily related to new programs and platforms in the electronic products business , the unmanned systems area , and the satellite communications business . unused office space and other . the benefit of $ 2.4 million for the year ended december 29 , 2013 was due to a reduction in the excess facility accrual of office space at the columbia , maryland administrative facilities , partially offset by expenses related to workforce reductions as a result of cost reduction initiatives we implemented across the company . the expense of $ 1.7 million for the year ended december 28 , 2014 was primarily due to an estimated excess facility accrual of office space at our sacramento , california administrative facilities , as well as due to employee termination costs related

percentage rents , which represent additional rents based upon the level of sales achieved by certain tenants , are recognized at the end of the lease year or earlier if we have determined the required sales level is achieved and the percentage rents are collectible . real estate tax and other cost reimbursements are recognized on an accrual basis over the periods in which the related expenditures are incurred . for a tenant to terminate its lease agreement prior to the end of the agreed term , we may require that they pay a fee to cancel the lease agreement . lease termination fees for which the tenant has relinquished control of the space are generally recognized on the termination date . when a lease is terminated early but the tenant continues to control the space under a modified lease agreement , the lease termination fee is generally recognized evenly over the remaining term of the modified lease agreement . current accounts receivable from tenants primarily relate to contractual minimum rent and percentage rent as well as real estate tax and other cost reimbursements . accounts receivable from straight-line rent is typically longer term in nature and relates to the cumulative amount by which straight-line rental income recorded to date exceeds cash rents billed to date under the contractual lease agreement . we make estimates of the collectability of our current accounts receivable and straight-line rents receivable which requires significant judgment by management . the collectability of receivables is affected by numerous factors including current economic conditions , bankruptcies , and the ability of the tenant to perform under the terms of their lease agreement . while we make estimates of potentially uncollectible amounts and provide an allowance for them through bad debt expense , actual collectability could differ from those estimates which could affect our net income . with respect to the allowance for current uncollectible tenant receivables , we assess the collectability of outstanding receivables by evaluating such factors as nature and age of the receivable , past history and current financial condition of the specific tenant including our assessment of the tenant 's ability to meet its contractual lease obligations , and the status of any pending disputes or lease negotiations with the tenant . at december 31 , 2011 and 2010 , our allowance for doubtful accounts was $ 17.6 million and $ 18.7 million , respectively . historically , we have recognized bad debt expense between 0.4 % and 1.3 % of rental income and it was 0.5 % in 2011 reflecting positive economic changes and their impact to our tenants . a change in the estimate of collectability of a receivable would result in a change to our allowance for doubtful accounts and correspondingly bad debt expense and net income . for example , in the event our estimates were not accurate and we were required to increase our allowance by 1 % of rental income , our bad debt expense would have increased and our net income would have decreased by $ 5.4 million . due to the nature of the accounts receivable from straight-line rents , the collection period of these amounts typically extends beyond one year . our experience relative to unbilled straight-line rents is that a portion of the amounts otherwise recognizable as revenue is never billed to or collected from tenants due to early lease terminations , lease modifications , bankruptcies and other factors . accordingly , the extended collection period for straight-line rents along with our evaluation of tenant credit risk may result in the nonrecognition of a portion of straight-line rental income until the collection of such income is reasonably assured . if our evaluation of tenant credit risk changes indicating more straight-line revenue is reasonably collectible than previously estimated and realized , the additional straight-line rental income is recognized as revenue . if our evaluation of tenant credit risk changes indicating a portion of realized straight-line rental income is no longer collectible , a reserve and bad debt expense is recorded . at december 31 , 2011 and 2010 , accounts receivable include approximately $ 50.5 million and $ 45.6 million , respectively , related to straight-line rents . correspondingly , these estimates of collectability have a direct impact on our net income . real estate the nature of our business as an owner , redeveloper and operator of retail shopping centers and mixed-use properties means that we invest significant amounts of capital . depreciation and maintenance costs relating to our properties constitute substantial costs for us as well as the industry as a whole . we capitalize real estate investments and depreciate them on a straight-line basis in accordance with gaap and consistent with industry standards based on our best estimates of the assets ' physical and economic useful lives . we periodically review the estimated lives of our assets and implement changes , as necessary , to these estimates and , therefore , to our depreciation rates . these reviews may take into account such factors as the 29 historical retirement and replacement of our assets , expected redevelopments , the repairs required to maintain the condition of our assets , and general economic and real estate factors . certain events could occur that would materially affect our estimates and assumptions related to depreciation . unforeseen competition or changes in customer shopping habits could substantially alter our assumptions regarding our ability to realize the expected return on investment in the property and therefore reduce the economic life of the asset and affect the amount of depreciation expense to be charged against both the current and future revenues . these assessments have a direct impact on our net income . the longer the economic useful life , the lower the depreciation expense will be for that asset in a fiscal period , which in turn will increase our net income . story_separator_special_tag on april 29 , 2011 , we repaid the $ 31.7 million mortgage loan on federal plaza which had an original maturity date of june 1 , 2011. on june 1 , 2011 , we repaid the $ 5.6 million mortgage loan on tysons station which had an original maturity date of september 1 , 2011. on july 7 , 2011 , we replaced our existing $ 300.0 million revolving credit facility with a new $ 400.0 million unsecured revolving credit facility . this new revolving credit facility matures on july 6 , 2015 , subject to a one-year extension at our option , and bears interest at libor plus 115 basis points . the spread over libor is subject to adjustment based on our credit rating . on november 22 , 2011 , we entered into a $ 275.0 million unsecured term loan which bears interest at libor plus 145 basis points . the spread over libor is subject to adjustment based on our credit rating . the loan matures on november 21 , 2018 and is prepayable without penalty after three years . we entered into two interest rate swap agreements to fix the variable rate portion of our $ 275.0 million term loan at 1.72 % from december 1 , 2011 through november 1 , 2018 . the swap agreements effectively fixed the rate on the term loan at 3.17 % . both swaps were designated and qualified as cash flow hedges and are recorded at fair value . in connection with the acquisition of montrose crossing on december 27 , 2011 , our joint venture that owns the property entered into an $ 80.0 million mortgage loan that bears interest at 4.20 % and matures on january 10 , 2022 . as montrose crossing is a consolidated property , 100 % of the mortgage loan is included in our consolidated balance sheet . in connection with the acquisition of plaza el segundo on december 30 , 2011 , we assumed our pro-rata share of an existing mortgage loan with a face amount of $ 175.0 million and a fair value of approximately $ 185.6 million . as plaza el segundo is a consolidated property , 100 % of the mortgage loan is included in our consolidated balance sheet . the mortgage loan requires monthly interest only payments through maturity , bears interest at a weighted average rate of 6.33 % and matures on august 5 , 2017 . mortgage loan receivable refinancing prior to june 30 , 2011 , we were the lender on a first and second mortgage loan on a shopping center and an adjacent commercial building in norwalk , connecticut . our carrying amount of the loans was approximately $ 18.3 million . the loans were in default and foreclosure proceedings had been filed , however , we were in negotiations with the borrower to refinance the loans . on june 30 , 2011 , we refinanced the existing loans with a first mortgage loan which had an initial principal balance of $ 11.9 million , bears interest at 6.0 % , and matures on june 30 , 2014 , subject to a one year extension option . the loan is secured by the shopping center in norwalk , connecticut . as part of the refinancing , we received approximately $ 8.7 million in cash . because the loans were in default , we had certain rights under the first mortgage loan agreement that gave us the ability to direct the activities that most significantly impacted the shopping center . although we did not exercise those rights , the existence of those rights in the loan agreement resulted in the entity being a variable interest entity ( `` vie `` ) . additionally , given our investment in both the first and second mortgage on the property , the overall decline in fair market value since the loans were initiated , and the default status of the loans , we also had the obligation to absorb losses or rights to receive benefits that could potentially be significant to the vie . consequently , we were the primary beneficiary of this vie and consolidated the shopping center and adjacent building from march 30 , 2010 to june 29 , 2011. our investment in the property is included in “ assets held for sale/disposal ” in the consolidated balance sheet at december 31 , 2010 and the operations of the entity are included in “ discontinued operations ” for all periods presented . in conjunction with the refinancing of the loans , we re-evaluated our status as the primary beneficiary of the vie . because the loan is not in default , we no longer have those certain rights that give us the ability to control the activities that most significantly impact the shopping center . our current involvement in the property is solely as the lender on the mortgage loan with protective rights as the lender . therefore , we are no longer the primary beneficiary and deconsolidated the entity as of 33 june 30 , 2011 . the mortgage loan receivable was recorded at its estimated fair value of $ 11.9 million and we recognized a $ 2.0 million gain on deconsolidation as part of the refinancing which is included in “ discontinued operations - gain on deconsolidation of vie ” for 2011 . as of december 31 , 2011 , the loan was performing and the carrying amount of the mortgage loan was $ 11.7 million which is included in “ mortgage notes receivable ” on the balance sheet . this amount also reflects our maximum exposure to loss related to this investment . the change in design of the entity including the refinancing of the loan was a vie reconsideration event . given that the loan is no longer in default , we , as lender , do not have the power to direct the activities that most significantly impact the

net cash provided by operating activities decreased $ 12.0 million to $ 244.7 million during 2011 from $ 256.7 million during 2010 . the decrease was primarily attributable to the $ 16.2 million payment of the final judgment related to a previously disclosed lawsuit offset by higher net income before certain non-cash items . net cash used in investing activities increased $ 9.3 million to $ 196.4 million during 2011 from $ 187.1 million during 2010 . 42 the increase was primarily attributable to : $ 53.4 million increase in capital investments , and $ 46.4 million increase in acquisitions of real estate primarily due to the december 2011 montrose crossing acquisition , partially offset by $ 34.6 million cash received from our newbury street partnership due to the sale of its properties in october 2011 , $ 23.7 million in proceeds from sales of real estate primarily from the sale of feasterville shopping center in july 2011 , $ 10.5 million acquisition of a first mortgage loan in march 2010 , $ 10.0 million decrease in contributions to the newbury street partnership due to the $ 16.7 million initial investment in 2010 , and $ 8.7 million payment received in june 2011 related to the refinancing of a mortgage loan receivable . net cash provided by financing activities increased $ 192.9 million to $ 3.7 million during 2011 from $ 189.2 million used in 2010 . the increase was primarily attributable to : $ 272.2 million in net proceeds from the term loan in november 2011 , $ 170.4 million decrease in repayment of mortgages , capital leases and notes payable due substantially to the $ 250.0 million payoff of our term loan in 2010 offset by the payoff of two mortgages totaling $ 37.4 million in 2011 , and $ 150.3 million increase in net proceeds from the issuance of common shares due primarily to the sale of 1.7 million shares under our atm equity program entered into in february 2011 , partially offset by $ 157.7 million increase in net repayments on our revolving credit facility , net of financing costs , $ 148.5 million in net proceeds from the issuance of 5.90

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```net cash provided by operating activities decreased $ 12.0 million to $ 244.7 million during 2011 from $ 256.7 million during 2010 . the decrease was primarily attributable to the $ 16.2 million payment of the final judgment related to a previously disclosed lawsuit offset by higher net income before certain non-cash items . net cash used in investing activities increased $ 9.3 million to $ 196.4 million during 2011 from $ 187.1 million during 2010 . 42 the increase was primarily attributable to : $ 53.4 million increase in capital investments , and $ 46.4 million increase in acquisitions of real estate primarily due to the december 2011 montrose crossing acquisition , partially offset by $ 34.6 million cash received from our newbury street partnership due to the sale of its properties in october 2011 , $ 23.7 million in proceeds from sales of real estate primarily from the sale of feasterville shopping center in july 2011 , $ 10.5 million acquisition of a first mortgage loan in march 2010 , $ 10.0 million decrease in contributions to the newbury street partnership due to the $ 16.7 million initial investment in 2010 , and $ 8.7 million payment received in june 2011 related to the refinancing of a mortgage loan receivable . net cash provided by financing activities increased $ 192.9 million to $ 3.7 million during 2011 from $ 189.2 million used in 2010 . the increase was primarily attributable to : $ 272.2 million in net proceeds from the term loan in november 2011 , $ 170.4 million decrease in repayment of mortgages , capital leases and notes payable due substantially to the $ 250.0 million payoff of our term loan in 2010 offset by the payoff of two mortgages totaling $ 37.4 million in 2011 , and $ 150.3 million increase in net proceeds from the issuance of common shares due primarily to the sale of 1.7 million shares under our atm equity program entered into in february 2011 , partially offset by $ 157.7 million increase in net repayments on our revolving credit facility , net of financing costs , $ 148.5 million in net proceeds from the issuance of 5.90 ``` Suspicious Activity Report : percentage rents , which represent additional rents based upon the level of sales achieved by certain tenants , are recognized at the end of the lease year or earlier if we have determined the required sales level is achieved and the percentage rents are collectible . real estate tax and other cost reimbursements are recognized on an accrual basis over the periods in which the related expenditures are incurred . for a tenant to terminate its lease agreement prior to the end of the agreed term , we may require that they pay a fee to cancel the lease agreement . lease termination fees for which the tenant has relinquished control of the space are generally recognized on the termination date . when a lease is terminated early but the tenant continues to control the space under a modified lease agreement , the lease termination fee is generally recognized evenly over the remaining term of the modified lease agreement . current accounts receivable from tenants primarily relate to contractual minimum rent and percentage rent as well as real estate tax and other cost reimbursements . accounts receivable from straight-line rent is typically longer term in nature and relates to the cumulative amount by which straight-line rental income recorded to date exceeds cash rents billed to date under the contractual lease agreement . we make estimates of the collectability of our current accounts receivable and straight-line rents receivable which requires significant judgment by management . the collectability of receivables is affected by numerous factors including current economic conditions , bankruptcies , and the ability of the tenant to perform under the terms of their lease agreement . while we make estimates of potentially uncollectible amounts and provide an allowance for them through bad debt expense , actual collectability could differ from those estimates which could affect our net income . with respect to the allowance for current uncollectible tenant receivables , we assess the collectability of outstanding receivables by evaluating such factors as nature and age of the receivable , past history and current financial condition of the specific tenant including our assessment of the tenant 's ability to meet its contractual lease obligations , and the status of any pending disputes or lease negotiations with the tenant . at december 31 , 2011 and 2010 , our allowance for doubtful accounts was $ 17.6 million and $ 18.7 million , respectively . historically , we have recognized bad debt expense between 0.4 % and 1.3 % of rental income and it was 0.5 % in 2011 reflecting positive economic changes and their impact to our tenants . a change in the estimate of collectability of a receivable would result in a change to our allowance for doubtful accounts and correspondingly bad debt expense and net income . for example , in the event our estimates were not accurate and we were required to increase our allowance by 1 % of rental income , our bad debt expense would have increased and our net income would have decreased by $ 5.4 million . due to the nature of the accounts receivable from straight-line rents , the collection period of these amounts typically extends beyond one year . our experience relative to unbilled straight-line rents is that a portion of the amounts otherwise recognizable as revenue is never billed to or collected from tenants due to early lease terminations , lease modifications , bankruptcies and other factors . accordingly , the extended collection period for straight-line rents along with our evaluation of tenant credit risk may result in the nonrecognition of a portion of straight-line rental income until the collection of such income is reasonably assured . if our evaluation of tenant credit risk changes indicating more straight-line revenue is reasonably collectible than previously estimated and realized , the additional straight-line rental income is recognized as revenue . if our evaluation of tenant credit risk changes indicating a portion of realized straight-line rental income is no longer collectible , a reserve and bad debt expense is recorded . at december 31 , 2011 and 2010 , accounts receivable include approximately $ 50.5 million and $ 45.6 million , respectively , related to straight-line rents . correspondingly , these estimates of collectability have a direct impact on our net income . real estate the nature of our business as an owner , redeveloper and operator of retail shopping centers and mixed-use properties means that we invest significant amounts of capital . depreciation and maintenance costs relating to our properties constitute substantial costs for us as well as the industry as a whole . we capitalize real estate investments and depreciate them on a straight-line basis in accordance with gaap and consistent with industry standards based on our best estimates of the assets ' physical and economic useful lives . we periodically review the estimated lives of our assets and implement changes , as necessary , to these estimates and , therefore , to our depreciation rates . these reviews may take into account such factors as the 29 historical retirement and replacement of our assets , expected redevelopments , the repairs required to maintain the condition of our assets , and general economic and real estate factors . certain events could occur that would materially affect our estimates and assumptions related to depreciation . unforeseen competition or changes in customer shopping habits could substantially alter our assumptions regarding our ability to realize the expected return on investment in the property and therefore reduce the economic life of the asset and affect the amount of depreciation expense to be charged against both the current and future revenues . these assessments have a direct impact on our net income . the longer the economic useful life , the lower the depreciation expense will be for that asset in a fiscal period , which in turn will increase our net income . story_separator_special_tag on april 29 , 2011 , we repaid the $ 31.7 million mortgage loan on federal plaza which had an original maturity date of june 1 , 2011. on june 1 , 2011 , we repaid the $ 5.6 million mortgage loan on tysons station which had an original maturity date of september 1 , 2011. on july 7 , 2011 , we replaced our existing $ 300.0 million revolving credit facility with a new $ 400.0 million unsecured revolving credit facility . this new revolving credit facility matures on july 6 , 2015 , subject to a one-year extension at our option , and bears interest at libor plus 115 basis points . the spread over libor is subject to adjustment based on our credit rating . on november 22 , 2011 , we entered into a $ 275.0 million unsecured term loan which bears interest at libor plus 145 basis points . the spread over libor is subject to adjustment based on our credit rating . the loan matures on november 21 , 2018 and is prepayable without penalty after three years . we entered into two interest rate swap agreements to fix the variable rate portion of our $ 275.0 million term loan at 1.72 % from december 1 , 2011 through november 1 , 2018 . the swap agreements effectively fixed the rate on the term loan at 3.17 % . both swaps were designated and qualified as cash flow hedges and are recorded at fair value . in connection with the acquisition of montrose crossing on december 27 , 2011 , our joint venture that owns the property entered into an $ 80.0 million mortgage loan that bears interest at 4.20 % and matures on january 10 , 2022 . as montrose crossing is a consolidated property , 100 % of the mortgage loan is included in our consolidated balance sheet . in connection with the acquisition of plaza el segundo on december 30 , 2011 , we assumed our pro-rata share of an existing mortgage loan with a face amount of $ 175.0 million and a fair value of approximately $ 185.6 million . as plaza el segundo is a consolidated property , 100 % of the mortgage loan is included in our consolidated balance sheet . the mortgage loan requires monthly interest only payments through maturity , bears interest at a weighted average rate of 6.33 % and matures on august 5 , 2017 . mortgage loan receivable refinancing prior to june 30 , 2011 , we were the lender on a first and second mortgage loan on a shopping center and an adjacent commercial building in norwalk , connecticut . our carrying amount of the loans was approximately $ 18.3 million . the loans were in default and foreclosure proceedings had been filed , however , we were in negotiations with the borrower to refinance the loans . on june 30 , 2011 , we refinanced the existing loans with a first mortgage loan which had an initial principal balance of $ 11.9 million , bears interest at 6.0 % , and matures on june 30 , 2014 , subject to a one year extension option . the loan is secured by the shopping center in norwalk , connecticut . as part of the refinancing , we received approximately $ 8.7 million in cash . because the loans were in default , we had certain rights under the first mortgage loan agreement that gave us the ability to direct the activities that most significantly impacted the shopping center . although we did not exercise those rights , the existence of those rights in the loan agreement resulted in the entity being a variable interest entity ( `` vie `` ) . additionally , given our investment in both the first and second mortgage on the property , the overall decline in fair market value since the loans were initiated , and the default status of the loans , we also had the obligation to absorb losses or rights to receive benefits that could potentially be significant to the vie . consequently , we were the primary beneficiary of this vie and consolidated the shopping center and adjacent building from march 30 , 2010 to june 29 , 2011. our investment in the property is included in “ assets held for sale/disposal ” in the consolidated balance sheet at december 31 , 2010 and the operations of the entity are included in “ discontinued operations ” for all periods presented . in conjunction with the refinancing of the loans , we re-evaluated our status as the primary beneficiary of the vie . because the loan is not in default , we no longer have those certain rights that give us the ability to control the activities that most significantly impact the shopping center . our current involvement in the property is solely as the lender on the mortgage loan with protective rights as the lender . therefore , we are no longer the primary beneficiary and deconsolidated the entity as of 33 june 30 , 2011 . the mortgage loan receivable was recorded at its estimated fair value of $ 11.9 million and we recognized a $ 2.0 million gain on deconsolidation as part of the refinancing which is included in “ discontinued operations - gain on deconsolidation of vie ” for 2011 . as of december 31 , 2011 , the loan was performing and the carrying amount of the mortgage loan was $ 11.7 million which is included in “ mortgage notes receivable ” on the balance sheet . this amount also reflects our maximum exposure to loss related to this investment . the change in design of the entity including the refinancing of the loan was a vie reconsideration event . given that the loan is no longer in default , we , as lender , do not have the power to direct the activities that most significantly impact the

as used in this report , the terms “ company ” , “ we ” , “ our ” , and “ us ” refer to i-on digital corp. , a delaware corporation . preliminary note regarding forward-looking statements this annual report contains forward-looking statements within the meaning of the federal securities laws . these forward-looking statements can be identified by the use of words such as “ believes , ” “ estimates , ” “ intends ” , “ plans ” , “ could , ” “ possibly , ” “ probably , ” anticipates , ” “ projects , ” “ expects , ” “ may , ” “ will , ” or “ should , ” “ designed to , ” “ designed for , ” or other variations or similar words or language . the forward-looking statements are based on the current expectations of the company and are subject to certain risks , uncertainties and assumptions , including those set forth in the discussion under “ management 's discussion and analysis of financial condition and results of operations ” in this report . actual results may differ materially from results anticipated in these forward-looking statements . we base the forward-looking statements on information currently available to us , and we assume no obligation to update them 23 business history of company i-on digital corp. ( the “ company ” ) was incorporated under the laws of the state of delaware on june 18 , 2013. on april 4 , 2014 , the michael j. rapport trust ( the “ trust ” ) purchased 10,000,000 shares of the company 's common stock which was all of the outstanding shares of alpine 3 , inc. , and subsequently changed the name to evans brewing company inc. ( “ ebc ” ) on may 29 , 2014. on october 9 , 2014 , the trust agreed to the cancellation of 9,600,000 of the shares of common stock that it had acquired and retained 400,000 shares of common stock . from april 2014 through december 2015 , ebc has been in the process of acquiring the bayhawk brands and related assets , as discussed in more detail below . on october 15 , 2014 , ebc entered into an asset purchase and share exchange agreement ( the “ agreement ” ) , with bayhawk ales , inc. ( “ bayhawk ” ) whereby bayhawk sold to ebc , and ebc purchased from bayhawk , assets of bayhawk , in exchange for 4,033,863 shares of ebc common stock upon the terms and subject to the conditions set forth in the asset purchase and share exchange agreement . on september 29 , 2016 , evans brewing company , inc. , closed the acquisition of a restaurant business located in the downtown soco district of fullerton , california , through the acquisition of all the outstanding stock of ebc public house , inc. , which the company now operates as its first branded restaurant and taproom under the trade name “ the public house by evans brewing company ” . the public house features the company 's beers – as well as beers from other selected local orange county , california breweries , food and , occasional entertainment . in connection with such closing , the company acquired 100 % of the outstanding shares of ebc public house from mr. rapport and issued 1,000,000 shares of the company 's series a preferred stock to mr. rapport . the asset purchase and share exchange have been treated as business combination as both companies are controlled by the same management . on january 25 , 2018 , the company consummated an agreement of merger and plan of reorganization ( the “ merger agreement ” ) , with i-on digital corp .. , a company organized under the laws of the republic of korea ( south korea ) ( “ i-on ” ) and i-on acquisition corp. , a wholly-owned subsidiary of the registrant ( “ acquisition ” ) . pursuant to the terms of the merger agreement , acquisition merged with and into i-on in a statutory reverse triangular merger ( the “ merger ” ) with i-on surviving as a wholly-owned subsidiary of the registrant . as consideration for the merger , the registrant agreed to issue the shareholders of i-on ( the “ i-on holders ” ) an aggregate of 26,000,000 shares of our common stock . following the merger , the registrant adopted the business plan of i-on in information technology consultancy and software development . on december 14 , 2017 , in connection with the merger , the registrant 's board of directors approved an amendment to its certificate of incorporation ( the “ amendment ” ) to change its name to i-on digital corp. on april 2 , 2019 , the company amended its certificate of incorporation to change the name of the company to “ i-on digital corp. ” overview prior to the merger , the company operated a craft brewery based on orange county , california that produces and sells premium craft beers , including a variety of ales and lagers . ebc 's beers are currently produced in its 17-barrel brewery in irvine , california , the oldest continuously operating brewing facility in orange county and one of the oldest in all of southern california . this facility has been producing craft beers since january 1995. following the merger , the company adopted the business plan of i-on . i-on was founded by jae cheol james oh , who currently serves as ceo , the company 's roots of which are in it consultancy and software development . story_separator_special_tag i-on services south korea 's enterprise content management system 's market and specializes in advancing market-leading internet software applications to capitalize on rapidly growing market sectors . 24 after being awarded its first of 6 patents in 2003 , i-on has since evolved into an industry-leading and recognized software developer and provider of enterprise-class unstructured data management and digital marketing software and solutions . i-on services over 1,000 blue-chip and middle-market clients across virtually all verticals in both private and public sectors . the company has meaningfully expanded its reach over the past decade and now currently licenses and sells its products and services directly to clients in south korea and japan , as well as in singapore , malaysia , indonesia , thailand , vietnam , and the u.s. through value-added resellers and partnerships . i-on 's portfolio of software and solutions serves the digital marketing and technology needs of organizations , enabling clients to create , measure , and optimizes digital experiences for their audiences across marketing channels and devices . we believe these solutions help clients reduce the cost of content management and delivery and increase the return on their investments in digital communication . on currently holds 6 international patents for both products and methodologies ( with 3 more pending ) built into the 11 product offerings the company currently has at market . these encompass enterprise web content management ( cms ) , web experience and service delivery software , digital marketing , smart mobility and analytics tools , and , more recently , energy management solutions . the company has designed and developed industry-leading technologies that are compliant with global standards including gs ( good software ) and net ( new excellent technology ) . i-on also holds numerous domestic and global industry awards , earning high rankings and recognition from the likes of gartner ( magic quadrant 2014 ) and red herring ( 2014 asia top 100 winner ) , among many others . basis of presentation the financial statements of the company are presented in united states dollars and have been prepared in accordance with accounting principles generally accepted in the united states . summary of significant accounting policies our significant accounting policies are more fully described in the notes to our consolidated financial statements included in this annual report on form 10-k for the fiscal year ended december 31 , 2019. we believe that the accounting policies below are critical for one to fully understand and evaluate our financial condition and results of operations . results of operations for the year ended december 31 , 2020 as compared to the year ended december 31 , 2019 replace_table_token_2_th 25 net sales net sales increased by $ 2,517,487 or 31 .7 % , to $ 10,471,502 for the year ended december 31 , 20 20 from $ 7,954,015 for the year ended december 31 , 201 9 . the net increase in net sales was primarily due the following : ● revenue from customization increased by $ 710,087 or 15.8 % , to $ 5,209,443 for the year ended december 31 , 20 20 from $ 4,499,346 for the year ended december 31 , 201 9 . the increase was due to increase in amount of customer contract revenue which was $ 9,578,588 for year ended december 31 , 20 20 compared to $ 6,980,876 for the year ended december 31 , 201 9 . ● revenue from maintenance increased by $ 338,571 or 23.1 % , to $ 1,802,032 for the year ended december 31 , 2020 from $ 1,463,461 for the year ended december 31 , 2019. the increase was due to increase in maintenance and development contracts and increase in number of customers to 91 in 2020 from 65 in 2019 . ● revenue from installation in creased by $ 1,140,802 or 144.2 % , to $ 1,931,765 for the year ended december 31 , 20 20 from $ 790,963 for the year ended december 31 , 201 9 . the in crease was due to increase in number of customers to 19 in 2020 from 9 in 201 9 . cost of goods sold cost of goods sold increased by $ 558 ,099 or 10 .1 % , to $ 6 ,078,030 for the year ended december 31 , 20 20 from $ 5,519,931 for the year ended december 31 , 201 9 . the increase was primarily due to increase in outside services ( outsourced developers ) followed by increase in revenue . gross profit ( loss ) gross profit increased by $ 1,959,388 , or 80.5 % , to gross profit of $ 4,393,472 , or 42 .0 % of net sales , for the year ended december 31 , 20 20 , from gross profit of $ 2,434,084 , or 30.6 % of net sales , for the year ended december 31 , 201 9 . the gross profit increase was mainly due to increase in sales of 31 .7 % in year 20 20 compared to year 201 9 . while outside services ( outsourced developers ) costs increased in year 20 20 compared to year 201 9 , salaries maintained same in year 20 20 compared to year 201 9 , which resulted in higher gross margin . research and development research and development expenses increased by $ 160 ,972 or 19 .2 % , to $ 999,209 for the year ended december 31 , 20 20 from $ 838,237 for the year ended december 31 , 201 9 . the in crease was due to in crease in head count . general and administrative general and administrative expenses decreased by $ 174 ,441 or -9 .3 % , to $ 1,697,377 for the year ended december 31 , 20 20 from $ 1,871,818 for the year ended december 31 , 201 9 , maintaining same expenses as prior year . other income ( expense ) other income ( expense ) for the year

liquidity and capital resources at december 31 , 2020 , the company had cash and cash equivalents of $ 4,521,328. we estimate that we will require up to $ 3,000,000 of capital for the next year of operations . we estimate that our expenses will be comprised primarily of general expenses including particularly marketing , research and development costs , overhead , legal and accounting fees . replace_table_token_3_th operating activities . operating cash flows for the fiscal 20 20 and 201 9 were a positive $ 2,600,978 and a positive $ 134,444 , respectively . the more increased cash flow from operating activities for the fiscal 20 20 compared to the same period last year primarily reflects increased net income . investing activities . net cash flows of investing activities for the fiscal 20 20 and 201 9 was negative $ 7,002 and a negative $ 462,131 , respectively . capital expenditures represented most of the cash used in investing activities flows for the fiscal 20 20 . the increase payable in short-term loans represented most of the cash provided by investing activities flows for fiscal 201 9 . financing activities . financing cash flows for the fiscal 20 20 and 201 9 were a positive $ 200,694 and a positive $ 57,296 , respectively . for the fiscal 2020 , net cash was provided primarily by receipt of government grants . for the fiscal 201 9 , net cash was provided primarily from increased borrowings under short term loan payable and long term loan payable , which was partially offset by treasury stock purchase . off balance sheet arrangements as of december 31 , 2020 , there were no off balance sheet arrangements .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```liquidity and capital resources at december 31 , 2020 , the company had cash and cash equivalents of $ 4,521,328. we estimate that we will require up to $ 3,000,000 of capital for the next year of operations . we estimate that our expenses will be comprised primarily of general expenses including particularly marketing , research and development costs , overhead , legal and accounting fees . replace_table_token_3_th operating activities . operating cash flows for the fiscal 20 20 and 201 9 were a positive $ 2,600,978 and a positive $ 134,444 , respectively . the more increased cash flow from operating activities for the fiscal 20 20 compared to the same period last year primarily reflects increased net income . investing activities . net cash flows of investing activities for the fiscal 20 20 and 201 9 was negative $ 7,002 and a negative $ 462,131 , respectively . capital expenditures represented most of the cash used in investing activities flows for the fiscal 20 20 . the increase payable in short-term loans represented most of the cash provided by investing activities flows for fiscal 201 9 . financing activities . financing cash flows for the fiscal 20 20 and 201 9 were a positive $ 200,694 and a positive $ 57,296 , respectively . for the fiscal 2020 , net cash was provided primarily by receipt of government grants . for the fiscal 201 9 , net cash was provided primarily from increased borrowings under short term loan payable and long term loan payable , which was partially offset by treasury stock purchase . off balance sheet arrangements as of december 31 , 2020 , there were no off balance sheet arrangements . ``` Suspicious Activity Report : as used in this report , the terms “ company ” , “ we ” , “ our ” , and “ us ” refer to i-on digital corp. , a delaware corporation . preliminary note regarding forward-looking statements this annual report contains forward-looking statements within the meaning of the federal securities laws . these forward-looking statements can be identified by the use of words such as “ believes , ” “ estimates , ” “ intends ” , “ plans ” , “ could , ” “ possibly , ” “ probably , ” anticipates , ” “ projects , ” “ expects , ” “ may , ” “ will , ” or “ should , ” “ designed to , ” “ designed for , ” or other variations or similar words or language . the forward-looking statements are based on the current expectations of the company and are subject to certain risks , uncertainties and assumptions , including those set forth in the discussion under “ management 's discussion and analysis of financial condition and results of operations ” in this report . actual results may differ materially from results anticipated in these forward-looking statements . we base the forward-looking statements on information currently available to us , and we assume no obligation to update them 23 business history of company i-on digital corp. ( the “ company ” ) was incorporated under the laws of the state of delaware on june 18 , 2013. on april 4 , 2014 , the michael j. rapport trust ( the “ trust ” ) purchased 10,000,000 shares of the company 's common stock which was all of the outstanding shares of alpine 3 , inc. , and subsequently changed the name to evans brewing company inc. ( “ ebc ” ) on may 29 , 2014. on october 9 , 2014 , the trust agreed to the cancellation of 9,600,000 of the shares of common stock that it had acquired and retained 400,000 shares of common stock . from april 2014 through december 2015 , ebc has been in the process of acquiring the bayhawk brands and related assets , as discussed in more detail below . on october 15 , 2014 , ebc entered into an asset purchase and share exchange agreement ( the “ agreement ” ) , with bayhawk ales , inc. ( “ bayhawk ” ) whereby bayhawk sold to ebc , and ebc purchased from bayhawk , assets of bayhawk , in exchange for 4,033,863 shares of ebc common stock upon the terms and subject to the conditions set forth in the asset purchase and share exchange agreement . on september 29 , 2016 , evans brewing company , inc. , closed the acquisition of a restaurant business located in the downtown soco district of fullerton , california , through the acquisition of all the outstanding stock of ebc public house , inc. , which the company now operates as its first branded restaurant and taproom under the trade name “ the public house by evans brewing company ” . the public house features the company 's beers – as well as beers from other selected local orange county , california breweries , food and , occasional entertainment . in connection with such closing , the company acquired 100 % of the outstanding shares of ebc public house from mr. rapport and issued 1,000,000 shares of the company 's series a preferred stock to mr. rapport . the asset purchase and share exchange have been treated as business combination as both companies are controlled by the same management . on january 25 , 2018 , the company consummated an agreement of merger and plan of reorganization ( the “ merger agreement ” ) , with i-on digital corp .. , a company organized under the laws of the republic of korea ( south korea ) ( “ i-on ” ) and i-on acquisition corp. , a wholly-owned subsidiary of the registrant ( “ acquisition ” ) . pursuant to the terms of the merger agreement , acquisition merged with and into i-on in a statutory reverse triangular merger ( the “ merger ” ) with i-on surviving as a wholly-owned subsidiary of the registrant . as consideration for the merger , the registrant agreed to issue the shareholders of i-on ( the “ i-on holders ” ) an aggregate of 26,000,000 shares of our common stock . following the merger , the registrant adopted the business plan of i-on in information technology consultancy and software development . on december 14 , 2017 , in connection with the merger , the registrant 's board of directors approved an amendment to its certificate of incorporation ( the “ amendment ” ) to change its name to i-on digital corp. on april 2 , 2019 , the company amended its certificate of incorporation to change the name of the company to “ i-on digital corp. ” overview prior to the merger , the company operated a craft brewery based on orange county , california that produces and sells premium craft beers , including a variety of ales and lagers . ebc 's beers are currently produced in its 17-barrel brewery in irvine , california , the oldest continuously operating brewing facility in orange county and one of the oldest in all of southern california . this facility has been producing craft beers since january 1995. following the merger , the company adopted the business plan of i-on . i-on was founded by jae cheol james oh , who currently serves as ceo , the company 's roots of which are in it consultancy and software development . story_separator_special_tag i-on services south korea 's enterprise content management system 's market and specializes in advancing market-leading internet software applications to capitalize on rapidly growing market sectors . 24 after being awarded its first of 6 patents in 2003 , i-on has since evolved into an industry-leading and recognized software developer and provider of enterprise-class unstructured data management and digital marketing software and solutions . i-on services over 1,000 blue-chip and middle-market clients across virtually all verticals in both private and public sectors . the company has meaningfully expanded its reach over the past decade and now currently licenses and sells its products and services directly to clients in south korea and japan , as well as in singapore , malaysia , indonesia , thailand , vietnam , and the u.s. through value-added resellers and partnerships . i-on 's portfolio of software and solutions serves the digital marketing and technology needs of organizations , enabling clients to create , measure , and optimizes digital experiences for their audiences across marketing channels and devices . we believe these solutions help clients reduce the cost of content management and delivery and increase the return on their investments in digital communication . on currently holds 6 international patents for both products and methodologies ( with 3 more pending ) built into the 11 product offerings the company currently has at market . these encompass enterprise web content management ( cms ) , web experience and service delivery software , digital marketing , smart mobility and analytics tools , and , more recently , energy management solutions . the company has designed and developed industry-leading technologies that are compliant with global standards including gs ( good software ) and net ( new excellent technology ) . i-on also holds numerous domestic and global industry awards , earning high rankings and recognition from the likes of gartner ( magic quadrant 2014 ) and red herring ( 2014 asia top 100 winner ) , among many others . basis of presentation the financial statements of the company are presented in united states dollars and have been prepared in accordance with accounting principles generally accepted in the united states . summary of significant accounting policies our significant accounting policies are more fully described in the notes to our consolidated financial statements included in this annual report on form 10-k for the fiscal year ended december 31 , 2019. we believe that the accounting policies below are critical for one to fully understand and evaluate our financial condition and results of operations . results of operations for the year ended december 31 , 2020 as compared to the year ended december 31 , 2019 replace_table_token_2_th 25 net sales net sales increased by $ 2,517,487 or 31 .7 % , to $ 10,471,502 for the year ended december 31 , 20 20 from $ 7,954,015 for the year ended december 31 , 201 9 . the net increase in net sales was primarily due the following : ● revenue from customization increased by $ 710,087 or 15.8 % , to $ 5,209,443 for the year ended december 31 , 20 20 from $ 4,499,346 for the year ended december 31 , 201 9 . the increase was due to increase in amount of customer contract revenue which was $ 9,578,588 for year ended december 31 , 20 20 compared to $ 6,980,876 for the year ended december 31 , 201 9 . ● revenue from maintenance increased by $ 338,571 or 23.1 % , to $ 1,802,032 for the year ended december 31 , 2020 from $ 1,463,461 for the year ended december 31 , 2019. the increase was due to increase in maintenance and development contracts and increase in number of customers to 91 in 2020 from 65 in 2019 . ● revenue from installation in creased by $ 1,140,802 or 144.2 % , to $ 1,931,765 for the year ended december 31 , 20 20 from $ 790,963 for the year ended december 31 , 201 9 . the in crease was due to increase in number of customers to 19 in 2020 from 9 in 201 9 . cost of goods sold cost of goods sold increased by $ 558 ,099 or 10 .1 % , to $ 6 ,078,030 for the year ended december 31 , 20 20 from $ 5,519,931 for the year ended december 31 , 201 9 . the increase was primarily due to increase in outside services ( outsourced developers ) followed by increase in revenue . gross profit ( loss ) gross profit increased by $ 1,959,388 , or 80.5 % , to gross profit of $ 4,393,472 , or 42 .0 % of net sales , for the year ended december 31 , 20 20 , from gross profit of $ 2,434,084 , or 30.6 % of net sales , for the year ended december 31 , 201 9 . the gross profit increase was mainly due to increase in sales of 31 .7 % in year 20 20 compared to year 201 9 . while outside services ( outsourced developers ) costs increased in year 20 20 compared to year 201 9 , salaries maintained same in year 20 20 compared to year 201 9 , which resulted in higher gross margin . research and development research and development expenses increased by $ 160 ,972 or 19 .2 % , to $ 999,209 for the year ended december 31 , 20 20 from $ 838,237 for the year ended december 31 , 201 9 . the in crease was due to in crease in head count . general and administrative general and administrative expenses decreased by $ 174 ,441 or -9 .3 % , to $ 1,697,377 for the year ended december 31 , 20 20 from $ 1,871,818 for the year ended december 31 , 201 9 , maintaining same expenses as prior year . other income ( expense ) other income ( expense ) for the year

from our inception until december 31 , 2012 , we have funded our operations primarily through the private and public sales of preferred stock , common stock , convertible notes and warrants to purchase common stock totaling $ 181.5 million ( net of issuance costs of $ 9.9 million ) , including $ 29.7 in net proceeds from our series c financing in august 2012 and $ 78.7 million in net proceeds from our initial public offering in october 2012 , and through the receipt of $ 16.4 million of up-front payments under our collaborative agreements . we have incurred net losses in each year since our inception in 2002. our net losses were approximately $ 15.1 million , $ 12.7 million and $ 43.6 million for the years ended december 31 , 2010 , 2011 and 2012 , respectively . as of december 31 , 2012 , we had an accumulated deficit of approximately $ 118.2 million . substantially all our net losses resulted from costs incurred in connection with our research and development 69 programs and from general and administrative costs associated with our operations , and particularly in 2012 , from the mark-to-market of our liability-classified warrants . we expect to continue to incur significant expenses and increasing operating losses for at least the next several years . we anticipate that our expenses will increase substantially as we : complete the development of our lead product candidate , oca , for the treatment of pbc ; seek to obtain regulatory approvals for oca ; outsource the commercial manufacturing of oca for any indications for which we receive regulatory approval ; contract with third parties for the sales , marketing and distribution of oca for any indications for which we receive regulatory approval ; continue our research and development efforts with our preclinical development compounds , int-767 and int-777 ; maintain , expand and protect our intellectual property portfolio ; add operational , financial and management information systems and personnel , including personnel to support our product development and commercialization efforts ; and operate as a public company . we do not expect to generate revenue from product sales unless and until we successfully complete development and obtain marketing approval for one or more of our product candidates , which we expect will take a number of years and is subject to significant uncertainty . accordingly , we anticipate that we will need to raise additional capital prior to the commercialization of oca or any of our other product candidates . until such time , if ever , as we can generate substantial revenue from product sales , we expect to finance our operating activities through a combination of equity offerings , debt financings , government or other third-party funding , marketing and distribution arrangements and other collaborations , strategic alliances and licensing arrangements . however , we may be unable to raise additional funds or enter into such other arrangements when needed on favorable terms or at all . our failure to raise capital or enter into such other arrangements as and when needed would have a negative impact on our financial condition and our ability to develop our product candidates . prior to april 2011 , we operated a wholly-owned subsidiary in italy where our bile acid receptor research was primarily conducted . subsequently , until march 15 , 2013 , our italian subsidiary was in the process of voluntary liquidation under italian law . effective march 15 , 2013 , we have decided to remove our italian subsidiary from the liquidation process and it will continue to act as our legal representative for our clinical trials in the european union to satisfy european union regulatory requirements . although our italian subsidiary was undergoing the liquidation process from april 2011 through march 2013 , we have continued our early stage tgr5 research program through our collaboration with les laboratories servier and institut de recherches servier , or collectively servier . financial overview revenue to date , we have not generated any revenue from the sale of products . all our revenue has been derived from our collaborative agreements for the development and commercialization of certain of our product candidates . in march 2011 , we entered into an exclusive licensing agreement with dsp for the development of oca in japan and china . under the terms of the agreement , we received an up-front payment of $ 15.0 million and may be eligible to receive up to approximately $ 300 million in additional payments for development , regulatory and commercial sales milestones for oca in japan and china . in august 2011 , we entered into a collaboration agreement with servier for the discovery , research and development of bile acid-derived agonists , or substances that bind to receptors of cells and trigger responses by those cells , for a dedicated bile acid receptor called tgr5 . under the terms of the agreement , we received an up-front payment from servier of $ 1.4 million . servier may be required to pay us up to an aggregate amount of approximately 70 108 million ( approximately $ 142.7 million as of december 31 , 2012 ) upon the achievement of specified development , regulatory and commercial sale milestones , as well as royalties on sales , based on the successful outcome of the collaboration . for accounting purposes , the up-front payments from both transactions are recorded as deferred revenue and amortized over time . we recognized $ 2.4 million in license revenue for the relevant amortization of the two up-front payments and did not receive any milestone payments during 2012 related to these agreements . as the servier up-front payment has been fully recognized as of the third quarter of 2012 , no further revenue will be recognized in respect of such payments . story_separator_special_tag for the purpose of identifying peer companies , we consider characteristics such as industry , length of trading history , similar vesting terms and in-the-money option status . we plan to continue to use the guideline peer group volatility information until the historical volatility of our common stock is relevant to measure expected volatility for future option grants . the assumed dividend yield is based on our expectation of not paying dividends for the foreseeable future . we determine the average expected life of stock options based on the simplified method in accordance with the securities and exchange commission staff accounting bulletin nos . 107 and 110. we expect to use the simplified method until we have sufficient historical exercise data to provide a reasonable basis upon which to estimate expected term . we determine the risk-free interest rate by reference to implied yields available from u.s. treasury securities with a remaining term equal to the expected life assumed at the date of grant . we estimate forfeitures based on our historical analysis of actual stock option forfeitures . 75 the assumptions used in the black-scholes option-pricing model for the years ended december 31 , 2010 , 2011 and 2012 are set forth below : replace_table_token_5_th we expect the impact of stock compensation to grow in future periods due to the potential increases in the value of our common stock , increased headcount and additional stock option and other equity grants . we are required to estimate the level of forfeitures expected to occur and record compensation expense only for those awards that we ultimately expect will vest . due to the lack of historical forfeiture activity of our plan , we expect to estimate our forfeiture rate based on peer company data with characteristics similar to our company . for 2010 , 2011 and 2012 , we used a forfeiture rate of five percent . there have been an insignificant number of forfeitures through december 31 , 2012. due to the absence of an active market for our common stock prior to our initial public offering in october 2012 , the fair value of our common stock for purposes of determining the exercise price for stock option grants was determined by our board of directors , with the assistance and upon the recommendation of management , in good faith , based on a number of objective and subjective factors consistent with the methodologies outlined in the american institute of certified public accountants practice aid , valuation of privately-held-company equity securities issued as compensation , or the practice aid , including : the prices at which we most recently sold our preferred stock and the rights , preferences and privileges of the preferred stock as compared to those of our common stock , including the liquidation preferences of the preferred stock ; our results of operations , financial position and the status of our research and development efforts , including the status of clinical trials for oca and our specific regulatory status and interactions with regulatory authorities ; the likelihood of achieving a liquidity event for the holders of our common stock and stock options , such as an initial public offering , given prevailing market conditions , or a strategic merger or sale of our company , or an m & a transaction ; the material risks related to our business ; achievement of enterprise milestones , including the results of clinical trials and our entry into or termination of collaboration and license agreements ; the market performance of publicly traded companies in the life sciences and biotechnology sectors , and recently completed mergers and acquisitions of companies comparable to us ; external market conditions affecting the life sciences and biotechnology industry sectors ; and the valuation prepared by an independent third-party consultant performed as of march 31 , 2010 and july 31 , 2012. each valuation methodology included estimates and assumptions that required our judgment . these estimates included assumptions regarding future performance , including the successful completion of clinical trials and the time to completing an initial public offering or sale . significant changes to the key assumptions used in the valuations could have resulted in different fair values of common stock at each valuation date . 76 common stock warrant liability in conjunction with various financing transactions , we issued warrants to purchase shares of our common stock as discussed above under “revaluation of warrants.” the black-scholes option-pricing model requires the use of subjective assumptions , including but not limited to stock price volatility , the expected life of the warrants , the risk free interest rate and the fair value of the common stock underlying the warrants . the fair value of the underlying common stock is determined as discussed above under “— stock-based compensation.” significant changes to the key assumptions used in the valuations could have resulted in different fair values of the warrants at each valuation date . we will continue to adjust the fair values of the warrants at each financial reporting period end for any changes in fair value until the earlier of the exercise or expiration of the applicable common stock warrants or until such time that the warrants are no longer determined to be derivative instruments . our warrant liability is expected to fluctuate based on the assumptions used in our valuation model . jobs act on april 5 , 2012 , the jumpstart our business startups act of 2012 , or the jobs act , was enacted . section 107 of the jobs act provides that an “emerging growth company” can take advantage of the extended transition period provided in section 7 ( a ) ( 2 ) ( b ) of the securities act of 1933 , as amended , or the securities act , for complying with new or revised accounting standards . in other words , an “emerging growth company” can delay the adoption of certain accounting standards until those standards would otherwise apply to

cash flows the following table sets forth the significant sources and uses of cash for the periods set forth below : replace_table_token_8_th operating activities . net cash used in operating activities of $ 13.7 million during the year ended december 31 , 2010 was primarily a result of our $ 15.1 million net loss , offset by the add-back of non-cash expenses of $ 1.7 million for stock-based compensation and $ 480,000 for depreciation and warrant liability revaluation income of $ 672,000. net cash provided by operating activities of $ 2.6 million during the year ended december 31 , 2011 was primarily a result of $ 16.4 million in up-front payments from our licensing and collaboration agreements with dsp and servier , $ 14.6 million of which was classified as deferred revenue as described in note 3 to our financial statements included elsewhere in this annual report on form 10-k. the cash payments from the collaboration agreements and the classification of those payments as deferred revenue led to an overall net increase in operating assets of $ 13.9 million , to which non-cash items of $ 1.9 million for stock-based compensation , $ 410,000 for depreciation and $ 217,000 for a loss on the sale of assets in connection with the potential liquidation of our italian subsidiary were added . these positive additions to cash flow were offset against our $ 12.7 million net loss and an additional $ 1.0 million decrease in assets due to the revaluation of our warrant liabilities .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```cash flows the following table sets forth the significant sources and uses of cash for the periods set forth below : replace_table_token_8_th operating activities . net cash used in operating activities of $ 13.7 million during the year ended december 31 , 2010 was primarily a result of our $ 15.1 million net loss , offset by the add-back of non-cash expenses of $ 1.7 million for stock-based compensation and $ 480,000 for depreciation and warrant liability revaluation income of $ 672,000. net cash provided by operating activities of $ 2.6 million during the year ended december 31 , 2011 was primarily a result of $ 16.4 million in up-front payments from our licensing and collaboration agreements with dsp and servier , $ 14.6 million of which was classified as deferred revenue as described in note 3 to our financial statements included elsewhere in this annual report on form 10-k. the cash payments from the collaboration agreements and the classification of those payments as deferred revenue led to an overall net increase in operating assets of $ 13.9 million , to which non-cash items of $ 1.9 million for stock-based compensation , $ 410,000 for depreciation and $ 217,000 for a loss on the sale of assets in connection with the potential liquidation of our italian subsidiary were added . these positive additions to cash flow were offset against our $ 12.7 million net loss and an additional $ 1.0 million decrease in assets due to the revaluation of our warrant liabilities . ``` Suspicious Activity Report : from our inception until december 31 , 2012 , we have funded our operations primarily through the private and public sales of preferred stock , common stock , convertible notes and warrants to purchase common stock totaling $ 181.5 million ( net of issuance costs of $ 9.9 million ) , including $ 29.7 in net proceeds from our series c financing in august 2012 and $ 78.7 million in net proceeds from our initial public offering in october 2012 , and through the receipt of $ 16.4 million of up-front payments under our collaborative agreements . we have incurred net losses in each year since our inception in 2002. our net losses were approximately $ 15.1 million , $ 12.7 million and $ 43.6 million for the years ended december 31 , 2010 , 2011 and 2012 , respectively . as of december 31 , 2012 , we had an accumulated deficit of approximately $ 118.2 million . substantially all our net losses resulted from costs incurred in connection with our research and development 69 programs and from general and administrative costs associated with our operations , and particularly in 2012 , from the mark-to-market of our liability-classified warrants . we expect to continue to incur significant expenses and increasing operating losses for at least the next several years . we anticipate that our expenses will increase substantially as we : complete the development of our lead product candidate , oca , for the treatment of pbc ; seek to obtain regulatory approvals for oca ; outsource the commercial manufacturing of oca for any indications for which we receive regulatory approval ; contract with third parties for the sales , marketing and distribution of oca for any indications for which we receive regulatory approval ; continue our research and development efforts with our preclinical development compounds , int-767 and int-777 ; maintain , expand and protect our intellectual property portfolio ; add operational , financial and management information systems and personnel , including personnel to support our product development and commercialization efforts ; and operate as a public company . we do not expect to generate revenue from product sales unless and until we successfully complete development and obtain marketing approval for one or more of our product candidates , which we expect will take a number of years and is subject to significant uncertainty . accordingly , we anticipate that we will need to raise additional capital prior to the commercialization of oca or any of our other product candidates . until such time , if ever , as we can generate substantial revenue from product sales , we expect to finance our operating activities through a combination of equity offerings , debt financings , government or other third-party funding , marketing and distribution arrangements and other collaborations , strategic alliances and licensing arrangements . however , we may be unable to raise additional funds or enter into such other arrangements when needed on favorable terms or at all . our failure to raise capital or enter into such other arrangements as and when needed would have a negative impact on our financial condition and our ability to develop our product candidates . prior to april 2011 , we operated a wholly-owned subsidiary in italy where our bile acid receptor research was primarily conducted . subsequently , until march 15 , 2013 , our italian subsidiary was in the process of voluntary liquidation under italian law . effective march 15 , 2013 , we have decided to remove our italian subsidiary from the liquidation process and it will continue to act as our legal representative for our clinical trials in the european union to satisfy european union regulatory requirements . although our italian subsidiary was undergoing the liquidation process from april 2011 through march 2013 , we have continued our early stage tgr5 research program through our collaboration with les laboratories servier and institut de recherches servier , or collectively servier . financial overview revenue to date , we have not generated any revenue from the sale of products . all our revenue has been derived from our collaborative agreements for the development and commercialization of certain of our product candidates . in march 2011 , we entered into an exclusive licensing agreement with dsp for the development of oca in japan and china . under the terms of the agreement , we received an up-front payment of $ 15.0 million and may be eligible to receive up to approximately $ 300 million in additional payments for development , regulatory and commercial sales milestones for oca in japan and china . in august 2011 , we entered into a collaboration agreement with servier for the discovery , research and development of bile acid-derived agonists , or substances that bind to receptors of cells and trigger responses by those cells , for a dedicated bile acid receptor called tgr5 . under the terms of the agreement , we received an up-front payment from servier of $ 1.4 million . servier may be required to pay us up to an aggregate amount of approximately 70 108 million ( approximately $ 142.7 million as of december 31 , 2012 ) upon the achievement of specified development , regulatory and commercial sale milestones , as well as royalties on sales , based on the successful outcome of the collaboration . for accounting purposes , the up-front payments from both transactions are recorded as deferred revenue and amortized over time . we recognized $ 2.4 million in license revenue for the relevant amortization of the two up-front payments and did not receive any milestone payments during 2012 related to these agreements . as the servier up-front payment has been fully recognized as of the third quarter of 2012 , no further revenue will be recognized in respect of such payments . story_separator_special_tag for the purpose of identifying peer companies , we consider characteristics such as industry , length of trading history , similar vesting terms and in-the-money option status . we plan to continue to use the guideline peer group volatility information until the historical volatility of our common stock is relevant to measure expected volatility for future option grants . the assumed dividend yield is based on our expectation of not paying dividends for the foreseeable future . we determine the average expected life of stock options based on the simplified method in accordance with the securities and exchange commission staff accounting bulletin nos . 107 and 110. we expect to use the simplified method until we have sufficient historical exercise data to provide a reasonable basis upon which to estimate expected term . we determine the risk-free interest rate by reference to implied yields available from u.s. treasury securities with a remaining term equal to the expected life assumed at the date of grant . we estimate forfeitures based on our historical analysis of actual stock option forfeitures . 75 the assumptions used in the black-scholes option-pricing model for the years ended december 31 , 2010 , 2011 and 2012 are set forth below : replace_table_token_5_th we expect the impact of stock compensation to grow in future periods due to the potential increases in the value of our common stock , increased headcount and additional stock option and other equity grants . we are required to estimate the level of forfeitures expected to occur and record compensation expense only for those awards that we ultimately expect will vest . due to the lack of historical forfeiture activity of our plan , we expect to estimate our forfeiture rate based on peer company data with characteristics similar to our company . for 2010 , 2011 and 2012 , we used a forfeiture rate of five percent . there have been an insignificant number of forfeitures through december 31 , 2012. due to the absence of an active market for our common stock prior to our initial public offering in october 2012 , the fair value of our common stock for purposes of determining the exercise price for stock option grants was determined by our board of directors , with the assistance and upon the recommendation of management , in good faith , based on a number of objective and subjective factors consistent with the methodologies outlined in the american institute of certified public accountants practice aid , valuation of privately-held-company equity securities issued as compensation , or the practice aid , including : the prices at which we most recently sold our preferred stock and the rights , preferences and privileges of the preferred stock as compared to those of our common stock , including the liquidation preferences of the preferred stock ; our results of operations , financial position and the status of our research and development efforts , including the status of clinical trials for oca and our specific regulatory status and interactions with regulatory authorities ; the likelihood of achieving a liquidity event for the holders of our common stock and stock options , such as an initial public offering , given prevailing market conditions , or a strategic merger or sale of our company , or an m & a transaction ; the material risks related to our business ; achievement of enterprise milestones , including the results of clinical trials and our entry into or termination of collaboration and license agreements ; the market performance of publicly traded companies in the life sciences and biotechnology sectors , and recently completed mergers and acquisitions of companies comparable to us ; external market conditions affecting the life sciences and biotechnology industry sectors ; and the valuation prepared by an independent third-party consultant performed as of march 31 , 2010 and july 31 , 2012. each valuation methodology included estimates and assumptions that required our judgment . these estimates included assumptions regarding future performance , including the successful completion of clinical trials and the time to completing an initial public offering or sale . significant changes to the key assumptions used in the valuations could have resulted in different fair values of common stock at each valuation date . 76 common stock warrant liability in conjunction with various financing transactions , we issued warrants to purchase shares of our common stock as discussed above under “revaluation of warrants.” the black-scholes option-pricing model requires the use of subjective assumptions , including but not limited to stock price volatility , the expected life of the warrants , the risk free interest rate and the fair value of the common stock underlying the warrants . the fair value of the underlying common stock is determined as discussed above under “— stock-based compensation.” significant changes to the key assumptions used in the valuations could have resulted in different fair values of the warrants at each valuation date . we will continue to adjust the fair values of the warrants at each financial reporting period end for any changes in fair value until the earlier of the exercise or expiration of the applicable common stock warrants or until such time that the warrants are no longer determined to be derivative instruments . our warrant liability is expected to fluctuate based on the assumptions used in our valuation model . jobs act on april 5 , 2012 , the jumpstart our business startups act of 2012 , or the jobs act , was enacted . section 107 of the jobs act provides that an “emerging growth company” can take advantage of the extended transition period provided in section 7 ( a ) ( 2 ) ( b ) of the securities act of 1933 , as amended , or the securities act , for complying with new or revised accounting standards . in other words , an “emerging growth company” can delay the adoption of certain accounting standards until those standards would otherwise apply to

derivative instruments and hedging activities as further consideration to the lenders under the credit agreement , bh/re has issued warrants to purchase membership interests held by bh/re in equityco . bh/re accounts for the outstanding warrants in equityco as embedded derivative instruments in accordance with sfas no . 133 , “ accounting for derivative instruments and hedging activities , ” and sfas no . 138 , “ accounting for certain derivative instruments and hedging activities—an amendment of fasb statement no . 133 ” . in conjunction with the mezzanine financing , mezzco issued warrants to purchase membership interests in the fully diluted equity of mezzco which contain a net cash settlement , and therefore are accounted for in accordance with emerging issues task force ( “eitf” ) 00-19 , “ accounting for derivative financial instruments indexed to , and potentially settled in , a company 's own stock ” . both sfas no . 133 and eitf 00-19 require that the warrants be recognized as liabilities , with changes in fair value affecting net income . see “note 7. long-term debt—mezzanine financing” . promotional allowances casino revenues are recognized as the net win from gaming activities , which is the difference between gaming wins and losses . all other revenues are recognized as the service is provided . revenues include the retail value of food , beverage , rooms , entertainment , and merchandise provided on a complimentary basis to customers . such complimentary amounts are then deducted from revenues as promotional allowances on our consolidated statements of operations . the estimated departmental costs of providing such promotional allowances are included in casino costs and expenses . hotel and food and beverage revenues hotel revenue recognition criteria are generally met at the time of occupancy . food and beverage revenue recognition criteria are generally met at the time of service . deposits for future hotel occupancy or food and beverage services are recorded as deferred income until revenue recognition criteria are met . cancellation fees for hotel and food and beverage services are recognized upon cancellation by the customer as defined by a written contract entered into with the customer . players ' club program players ' club members earn points based on gaming activity , which can be redeemed for cash . we accrue expense related to this program as the points are earned based on historical redemption percentages . allowance for doubtful accounts reserves our receivables balances relate primarily to our hotel and casino operations . we reserve an estimated amount for receivables that may not be collected . we estimate the allowance for doubtful accounts by applying standard reserve percentages to aged account balances under a specific dollar amount and specifically analyzing the collectibility of each account with a balance over the specified dollar amount , 26 based on the age of the account , the customers ' financial condition , collection history and any other known information . the allowance for doubtful accounts as a percentage of receivables at december 31 , 2005 increased when compared to december 31 , 2004 primarily as a result of the increase in casino receivables . the increase in casino receviables is commensurate with the increase in marker play throughout 2005. we maintain strict controls over the issuance of markers and aggressively pursue collection from those customers who fail to pay their markers timely . markers are generally legally enforceable instruments in the united states and at december 31 , 2005 , all of our casino receivables were owed by customers in the united states . the following table summarizes our receivable balances ( in thousands ) : replace_table_token_2_th self-insurance accruals we are self-insured , up to certain limits , for costs associated with employee medical coverage . we accrue for the estimated expense of known claims , as well as estimates for claims incurred but not yet reported . income taxes the consolidated financial statements include the operations of bh/re and its controlled subsidiaries : equityco , mezzco , and opbiz . bh/re and equityco are limited liability companies and are taxed as partnerships for federal income tax purposes . mezzco has elected to be taxed as a corporation for federal income tax purposes . opbiz , a wholly-owned subsidiary of mezzco , will be treated as a division of mezzco for federal income tax purposes , and accordingly , will also be subject to federal income taxes . mezzco and opbiz account for income taxes in accordance with sfas no . 109 , “ accounting for income taxes ” . sfas 109 requires the recognition of deferred income tax assets , net of applicable reserves , related to net operating loss carryforwards and certain temporary differences . the standard requires recognition of a future tax benefit to the extent that realization of such benefit is more likely than not . otherwise , a valuation allowance is applied . preopening costs we account for costs incurred during the preopening and start-up phases of operations in accordance with statement of position 98-5 , “ reporting on the costs of start-up activities ” . preopening and start-up costs include , but are not limited to , salary related expenses for new employees , travel and entertainment expenses . preopening costs are expensed as incurred . membership interests as of december 31 , 2005 , our membership interests had not been unitized and our members do not presently intend to unitize these membership interests . accordingly , we have excluded earnings per 27 membership unit data required pursuant to sfas no . 128 , “ earnings per share , ” because we believe that such disclosures would not be meaningful to the financial statement presentation . the company has entered into various employment agreements , as amended , with several executives . the employment agreements have initial terms of two to five years . story_separator_special_tag % to $ 16.8 million for the year ended december 31 , 2004 as compared to $ 18.4 million for the year ended december 31 , 2003. other expenses decreased 15.6 % to $ 12.1 million for the year ended december 31 , 2004 as compared to $ 14.3 million for the year ended december 31 , 2003. the decrease in other revenues and other expenses was primarily due to fewer performances in the tpa during 2004 resulting in decreased revenue and expenses . selling , general and administrative ( “sg & a” ) sg & a expenses increased 21.9 % to $ 79.4 million for the year ended december 31 , 2005 as compared to $ 65.1 million for the year ended december 31 , 2004. sg & a expenses as a percentage of net revenues increased 3.2 percentage points in comparing the same twelve-month periods . the increase in sg & a expenses was primarily due to repair and maintenance expenses incurred in the fourth quarter and included painting the building and additional administrative office space . the addition of management bonuses and legal and professional fees , which were included in reorganization costs reported below the operating income line and not in sg & a by aladdin gaming in 2004 , also contributed to the increase in sg & a expenses when compared to prior year . sg & a expenses increased 5.5 % to $ 65.1 million for the year ended december 31 , 2004 as compared to $ 61.7 million for the year ended december 31 , 2003. sg & a expenses as a percentage of net revenues decreased 0.4 percentage points in comparing the same twelve-month periods . the increase in sg & a expenses was primarily due to an increase in payroll and related expenses , as well as the addition of management and centralized services fees incurred under the starwood management agreement beginning in september 2004. depreciation and amortization aladdin gaming did not record depreciation expense during 2004 , as the assets were classified as “held for sale” . as a result , depreciation expense for the year ended december 31 , 2005 , was significantly greater than the same period in the prior year . depreciation and amortization expense was approximately $ 23.6 million for the year ended december 31 , 2005 as compared to $ 7.8 million for the year ended december 31 , 2004 . 33 depreciation and amortization expense decreased 82.0 % to $ 7.8 million for the year ended december 31 , 2004 as compared to $ 43.5 million for the year ended december 31 , 2003. aladdin gaming was not recording depreciation expense during 2004 , as the assets were classified as “held for sale” . as a result , the depreciation expense for the year ended december 31 , 2004 was significantly less than in the prior year . net interest expense net interest expense increased to $ 55.0 million for the year ended december 31 , 2005 as compared to $ 19.1 million for the year ended december 31 , 2004. the increase in net interest expense is directly related to the addition of the credit agreement we entered into upon the completion of the acquisition of the aladdin on september 1 , 2004. see “description of certain indebtedness” below . net interest expense increased 92.7 % to $ 19.1 million for the year ended december 31 , 2004 as compared to $ 9.9 million for the year ended december 31 , 2003. the increase in net interest expense is directly related to the addition of the credit agreement we entered into upon the completion of the acquisition of the aladdin on september 1 , 2004. interest expense under the credit agreement is calculated quarterly and is based on the london inter-bank offered rate , or libor , plus an applicable margin . libor increased approximately 150 basis points throughout 2005 thereby increasing our average borrowing rate and related interest expense . the increases in libor resulted in approximately $ 3.7 million in additional interest expense for the year ended december 31 , 2005. financial impact of renovation of the aladdin as discussed in “item 1a.— risks related to the aladdin renovation” , we have embarked upon a renovation plan that will transition the aladdin into the ph resort . the renovation project was substantially underway in january 2006 and is being conducted in phases to attempt to reduce disruption to our business to the extent practicable . our operating projections for 2006 assumed certain business level declines as a result of the renovation project . although the declines in hotel and casino operations have not been as great as anticipated , we have experienced greater declines than anticipated in other operating areas , particularly food and beverage . we believe that cost savings measures implemented to date will allow us to offset the noted declines and that we will operate within the parameters of the originally established operating projections throughout the renovation period in 2006. we can provide no assurance that we have accurately estimated our operating projections and that we will not experience additional unforeseen events that will adversely impact our operating results during the renovation period . story_separator_special_tag style= `` font-size:3.0pt ; `` > $ 1.25 million on the first day of each fiscal quarter during the period beginning on august 31 , 2006 and ending on august 31 , 2007 ; · $ 3.75 million on the first day of each fiscal quarter during the period beginning on august 31 , 2007 and ending on august 31 , 2008 ; · $ 5.0 million on the first day of each fiscal quarter during the period beginning on august 31 , 2008 and ending on august 31 , 2009 ; · $ 6.25 million on the first day of each fiscal quarter during the period beginning on august 31 , 2009 and ending on august 31 , 2010 ; and ·

liquidity and capital resources during the year ended december 31 , 2005 , the aladdin utilized cash flows from operating activities of approximately $ 4.6 million and had a balance of $ 41.4 million in cash and cash equivalents as of december 31 , 2005 , which was a $ 4.4 million increase over the balance as of december 31 , 2004. we also had restricted cash and cash equivalents of approximately $ 87.8 million , which is designated to be used for costs associated with the renovation of the aladdin to the ph resort . our primary cash requirements for 2006 are expected to include ( i ) up to approximately $ 100 million in capital expenditures related to the renovation project , ( ii ) approximately $ 21.2 million for maintenance capital expenditures and ( iii ) up to approximately $ 31.8 million in interest payments on our debt . we believe that cash generated from operations , the capital invested in opbiz at the closing and the working capital , including the cash , we acquired from aladdin gaming under the purchase agreement will be adequate to meet the anticipated working capital , capital expenditure , renovation and debt service 34 obligations of opbiz for the period that the aladdin is under renovation . we may have other liquidity needs , such as tax distributions to the members of equityco and bh/re . the credit agreement provides that opbiz will be permitted to make tax distributions . there can be no assurance that we have accurately estimated our liquidity needs , or that we will not experience unforeseen events that may materially increase our need for liquidity to fund our operations or capital expenditure programs or decrease the amount of cash generated from our operations .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```liquidity and capital resources during the year ended december 31 , 2005 , the aladdin utilized cash flows from operating activities of approximately $ 4.6 million and had a balance of $ 41.4 million in cash and cash equivalents as of december 31 , 2005 , which was a $ 4.4 million increase over the balance as of december 31 , 2004. we also had restricted cash and cash equivalents of approximately $ 87.8 million , which is designated to be used for costs associated with the renovation of the aladdin to the ph resort . our primary cash requirements for 2006 are expected to include ( i ) up to approximately $ 100 million in capital expenditures related to the renovation project , ( ii ) approximately $ 21.2 million for maintenance capital expenditures and ( iii ) up to approximately $ 31.8 million in interest payments on our debt . we believe that cash generated from operations , the capital invested in opbiz at the closing and the working capital , including the cash , we acquired from aladdin gaming under the purchase agreement will be adequate to meet the anticipated working capital , capital expenditure , renovation and debt service 34 obligations of opbiz for the period that the aladdin is under renovation . we may have other liquidity needs , such as tax distributions to the members of equityco and bh/re . the credit agreement provides that opbiz will be permitted to make tax distributions . there can be no assurance that we have accurately estimated our liquidity needs , or that we will not experience unforeseen events that may materially increase our need for liquidity to fund our operations or capital expenditure programs or decrease the amount of cash generated from our operations . ``` Suspicious Activity Report : derivative instruments and hedging activities as further consideration to the lenders under the credit agreement , bh/re has issued warrants to purchase membership interests held by bh/re in equityco . bh/re accounts for the outstanding warrants in equityco as embedded derivative instruments in accordance with sfas no . 133 , “ accounting for derivative instruments and hedging activities , ” and sfas no . 138 , “ accounting for certain derivative instruments and hedging activities—an amendment of fasb statement no . 133 ” . in conjunction with the mezzanine financing , mezzco issued warrants to purchase membership interests in the fully diluted equity of mezzco which contain a net cash settlement , and therefore are accounted for in accordance with emerging issues task force ( “eitf” ) 00-19 , “ accounting for derivative financial instruments indexed to , and potentially settled in , a company 's own stock ” . both sfas no . 133 and eitf 00-19 require that the warrants be recognized as liabilities , with changes in fair value affecting net income . see “note 7. long-term debt—mezzanine financing” . promotional allowances casino revenues are recognized as the net win from gaming activities , which is the difference between gaming wins and losses . all other revenues are recognized as the service is provided . revenues include the retail value of food , beverage , rooms , entertainment , and merchandise provided on a complimentary basis to customers . such complimentary amounts are then deducted from revenues as promotional allowances on our consolidated statements of operations . the estimated departmental costs of providing such promotional allowances are included in casino costs and expenses . hotel and food and beverage revenues hotel revenue recognition criteria are generally met at the time of occupancy . food and beverage revenue recognition criteria are generally met at the time of service . deposits for future hotel occupancy or food and beverage services are recorded as deferred income until revenue recognition criteria are met . cancellation fees for hotel and food and beverage services are recognized upon cancellation by the customer as defined by a written contract entered into with the customer . players ' club program players ' club members earn points based on gaming activity , which can be redeemed for cash . we accrue expense related to this program as the points are earned based on historical redemption percentages . allowance for doubtful accounts reserves our receivables balances relate primarily to our hotel and casino operations . we reserve an estimated amount for receivables that may not be collected . we estimate the allowance for doubtful accounts by applying standard reserve percentages to aged account balances under a specific dollar amount and specifically analyzing the collectibility of each account with a balance over the specified dollar amount , 26 based on the age of the account , the customers ' financial condition , collection history and any other known information . the allowance for doubtful accounts as a percentage of receivables at december 31 , 2005 increased when compared to december 31 , 2004 primarily as a result of the increase in casino receivables . the increase in casino receviables is commensurate with the increase in marker play throughout 2005. we maintain strict controls over the issuance of markers and aggressively pursue collection from those customers who fail to pay their markers timely . markers are generally legally enforceable instruments in the united states and at december 31 , 2005 , all of our casino receivables were owed by customers in the united states . the following table summarizes our receivable balances ( in thousands ) : replace_table_token_2_th self-insurance accruals we are self-insured , up to certain limits , for costs associated with employee medical coverage . we accrue for the estimated expense of known claims , as well as estimates for claims incurred but not yet reported . income taxes the consolidated financial statements include the operations of bh/re and its controlled subsidiaries : equityco , mezzco , and opbiz . bh/re and equityco are limited liability companies and are taxed as partnerships for federal income tax purposes . mezzco has elected to be taxed as a corporation for federal income tax purposes . opbiz , a wholly-owned subsidiary of mezzco , will be treated as a division of mezzco for federal income tax purposes , and accordingly , will also be subject to federal income taxes . mezzco and opbiz account for income taxes in accordance with sfas no . 109 , “ accounting for income taxes ” . sfas 109 requires the recognition of deferred income tax assets , net of applicable reserves , related to net operating loss carryforwards and certain temporary differences . the standard requires recognition of a future tax benefit to the extent that realization of such benefit is more likely than not . otherwise , a valuation allowance is applied . preopening costs we account for costs incurred during the preopening and start-up phases of operations in accordance with statement of position 98-5 , “ reporting on the costs of start-up activities ” . preopening and start-up costs include , but are not limited to , salary related expenses for new employees , travel and entertainment expenses . preopening costs are expensed as incurred . membership interests as of december 31 , 2005 , our membership interests had not been unitized and our members do not presently intend to unitize these membership interests . accordingly , we have excluded earnings per 27 membership unit data required pursuant to sfas no . 128 , “ earnings per share , ” because we believe that such disclosures would not be meaningful to the financial statement presentation . the company has entered into various employment agreements , as amended , with several executives . the employment agreements have initial terms of two to five years . story_separator_special_tag % to $ 16.8 million for the year ended december 31 , 2004 as compared to $ 18.4 million for the year ended december 31 , 2003. other expenses decreased 15.6 % to $ 12.1 million for the year ended december 31 , 2004 as compared to $ 14.3 million for the year ended december 31 , 2003. the decrease in other revenues and other expenses was primarily due to fewer performances in the tpa during 2004 resulting in decreased revenue and expenses . selling , general and administrative ( “sg & a” ) sg & a expenses increased 21.9 % to $ 79.4 million for the year ended december 31 , 2005 as compared to $ 65.1 million for the year ended december 31 , 2004. sg & a expenses as a percentage of net revenues increased 3.2 percentage points in comparing the same twelve-month periods . the increase in sg & a expenses was primarily due to repair and maintenance expenses incurred in the fourth quarter and included painting the building and additional administrative office space . the addition of management bonuses and legal and professional fees , which were included in reorganization costs reported below the operating income line and not in sg & a by aladdin gaming in 2004 , also contributed to the increase in sg & a expenses when compared to prior year . sg & a expenses increased 5.5 % to $ 65.1 million for the year ended december 31 , 2004 as compared to $ 61.7 million for the year ended december 31 , 2003. sg & a expenses as a percentage of net revenues decreased 0.4 percentage points in comparing the same twelve-month periods . the increase in sg & a expenses was primarily due to an increase in payroll and related expenses , as well as the addition of management and centralized services fees incurred under the starwood management agreement beginning in september 2004. depreciation and amortization aladdin gaming did not record depreciation expense during 2004 , as the assets were classified as “held for sale” . as a result , depreciation expense for the year ended december 31 , 2005 , was significantly greater than the same period in the prior year . depreciation and amortization expense was approximately $ 23.6 million for the year ended december 31 , 2005 as compared to $ 7.8 million for the year ended december 31 , 2004 . 33 depreciation and amortization expense decreased 82.0 % to $ 7.8 million for the year ended december 31 , 2004 as compared to $ 43.5 million for the year ended december 31 , 2003. aladdin gaming was not recording depreciation expense during 2004 , as the assets were classified as “held for sale” . as a result , the depreciation expense for the year ended december 31 , 2004 was significantly less than in the prior year . net interest expense net interest expense increased to $ 55.0 million for the year ended december 31 , 2005 as compared to $ 19.1 million for the year ended december 31 , 2004. the increase in net interest expense is directly related to the addition of the credit agreement we entered into upon the completion of the acquisition of the aladdin on september 1 , 2004. see “description of certain indebtedness” below . net interest expense increased 92.7 % to $ 19.1 million for the year ended december 31 , 2004 as compared to $ 9.9 million for the year ended december 31 , 2003. the increase in net interest expense is directly related to the addition of the credit agreement we entered into upon the completion of the acquisition of the aladdin on september 1 , 2004. interest expense under the credit agreement is calculated quarterly and is based on the london inter-bank offered rate , or libor , plus an applicable margin . libor increased approximately 150 basis points throughout 2005 thereby increasing our average borrowing rate and related interest expense . the increases in libor resulted in approximately $ 3.7 million in additional interest expense for the year ended december 31 , 2005. financial impact of renovation of the aladdin as discussed in “item 1a.— risks related to the aladdin renovation” , we have embarked upon a renovation plan that will transition the aladdin into the ph resort . the renovation project was substantially underway in january 2006 and is being conducted in phases to attempt to reduce disruption to our business to the extent practicable . our operating projections for 2006 assumed certain business level declines as a result of the renovation project . although the declines in hotel and casino operations have not been as great as anticipated , we have experienced greater declines than anticipated in other operating areas , particularly food and beverage . we believe that cost savings measures implemented to date will allow us to offset the noted declines and that we will operate within the parameters of the originally established operating projections throughout the renovation period in 2006. we can provide no assurance that we have accurately estimated our operating projections and that we will not experience additional unforeseen events that will adversely impact our operating results during the renovation period . story_separator_special_tag style= `` font-size:3.0pt ; `` > $ 1.25 million on the first day of each fiscal quarter during the period beginning on august 31 , 2006 and ending on august 31 , 2007 ; · $ 3.75 million on the first day of each fiscal quarter during the period beginning on august 31 , 2007 and ending on august 31 , 2008 ; · $ 5.0 million on the first day of each fiscal quarter during the period beginning on august 31 , 2008 and ending on august 31 , 2009 ; · $ 6.25 million on the first day of each fiscal quarter during the period beginning on august 31 , 2009 and ending on august 31 , 2010 ; and ·

20 page 25 returns of several major equity market indexes for 2020 are as follows : s & p 500 index 18.4 % nasdaq composite index ( 1 ) 43.6 % russell 2000 index 20.0 % msci eafe ( europe , australasia , and far east ) index 8.3 % msci emerging markets index 18.7 % ( 1 ) returns exclude dividends global bonds produced mostly positive returns , as central banks slashed short-term interest rates and sovereign bond yields in many countries fell sharply . in the u.s. investment-grade market , corporate bonds did best , as investors sought attractive yields in a low interest rate environment . treasury securities also did well as yields dropped across the yield curve . the 10-year u.s. treasury note yield decreased from 1.92 % to 0.93 % over the last year . asset- and mortgage-backed securities produced relatively mild gains . high yield corporate bonds and tax-free municipal bonds rose but trailed the broad taxable investment-grade bond market . bonds in developed non-u.s. markets produced strong gains in u.s. dollar terms , helped by dollar weakness against the euro and , to a lesser extent , the japanese yen and the british pound . bonds in developing markets generally appreciated in u.s. dollar terms , though local currency weakness in some countries , especially brazil , turkey , and russia , reduced local returns to u.s. investors . returns of several major bond market indexes for 2020 are as follows : bloomberg barclays u.s. aggregate bond index 7.5 % jpmorgan global high yield index 5.4 % bloomberg barclays municipal bond index 5.2 % bloomberg barclays global aggregate ex-u.s. dollar bond index 10.1 % jpmorgan emerging markets bond index plus 7.1 % assets under management . assets under management ended 2020 at $ 1,470.5 billion , an increase of $ 263.7 billion from the end of 2019. this increase was driven by market appreciation and income , net of distributions not reinvested , of $ 256.9 billion and net cash inflows of $ 5.6 billion for 2020. in addition , we acquired client contracts from pnc bank in september 2020 that added $ 1.2 billion of stable value assets under management . clients transferred $ 13.7 billion in net assets from the u.s. mutual funds to primarily collective investment trusts and other investment products , of which $ 8.6 billion transferred into the retirement date trusts . 20 page 26 the following table details changes in our assets under management by vehicle during the last three years : replace_table_token_6_th ( 1 ) in all three years , the majority of the client transfers were from the t. rowe price u.s. mutual funds to the t. rowe price collective investment trusts , which are included in collective investment trusts and other investment products . 20 page 27 the following table details changes in our assets under management by asset class during the last three years : replace_table_token_7_th ( 1 ) the underlying assets under management of the multi-asset portfolios have been aggregated and presented in this category and not reported in the equity and fixed income columns . ( 2 ) reported net of distributions not reinvested . investment advisory clients outside the u.s. account for 9.3 % of our assets under management at december 31 , 2020 and 6.9 % at december 31 , 2019. our net cash flows in 2020 reflect net positive flows due to inflows into fixed income and international equity . these inflows were partially offset by cash outflows in domestic equity and our multi-asset franchise resulting from macro-economic headwinds , including the cares act , and ongoing pressure from passive . in terms of equity products , the cash inflows from international equity offset the cash outflows from domestic equity products . from a geography perspective , emea and apac regions performed well with positive net flows predominantly in equity in both regions . net cash flows for 2019 , and 2018 were driven by diversified inflows across distribution channels and geographies , the strength of our multi-asset franchise , and positive flows into fixed income and international equity . our target date retirement products , which are included in the multi-asset totals shown above , continue to be a significant part of our assets under management . assets under management in our target date retirement products as well as net cash inflows/ ( outflows ) , by vehicle , are as follows : replace_table_token_8_th we provide participant accounting and plan administration for defined contribution retirement plans that invest in the firm 's u.s. mutual funds , collective investment trusts and funds outside of the firm 's complex . as of december 31 , 2020 , our assets under administration were $ 239 billion , of which nearly $ 148 billion are assets we manage . in recent years , we began offering non-discretionary advisory services through model delivery , which are managed accounts where portfolio holdings and trades in the portfolio are provided to sponsor platforms to implement for their clients . we record the revenue earned on these services in administrative fees . the assets under advisement in 20 page 28 these portfolios , predominantly in the united states , is $ 2.8 billion at december 31 , 2020. investment performance . strong investment performance and brand awareness is a key driver to attracting and retaining assets—and to our long-term success . beginning in the third quarter of 2020 , we expanded our performance disclosures to include specific assets classes , assets under management weighted performance , mutual fund performance against passive peers and composite performance against benchmarks . the following table presents investment performance for the one- , three- , five- , and 10-years ended december 31 , 2020. past performance is no guarantee of future results . story_separator_special_tag operating expenses replace_table_token_13_th ( 1 ) the percentage change in nonrecurring net recoveries related to dell appraisal rights matter is not meaningful ( n/m ) . compensation and related costs . compensation and related costs increased $ 213.2 million , or 10.8 % , for 2020 as compared with 2019. the increase in compensation and related costs was primarily due to an $ 83.0 million increase in salaries , benefits and related employee costs , as our average staff size increased 5.8 % from prior year and we made modest increases to base salaries at the beginning of the year . strong 2020 operating results led to a $ 65.5 million increase in our annual variable compensation , primarily bonus compensation , and higher stock-based 20 page 34 compensation expense . these increases in compensation and related costs were partially offset by $ 30.4 million in higher labor capitalization related to internally developed software in 2020. the $ 38.6 million in higher expense related to our supplemental savings plan from strong market returns is partially offset by the non-operating gains on the investments used to economically hedge the related liability . for 2019 , compensation and related costs increased $ 160.6 million , or 8.9 % , as compared with 2018. nearly half of the increase in compensation and related costs is attributable to $ 78.8 million in higher expense related to our supplemental savings plan given the strong equity market returns experienced in 2019 compared with the sharp equity market declines in late 2018. the higher expense related to the supplemental savings plan is partially offset by the non-operating gains earned on the investments used to economically hedge the related liability . we also experienced increases in base salaries , benefits , and related employee costs of $ 66.0 million , as our average staff size grew 3.1 % in 2019 and we modestly increased base salaries at the beginning of 2019. our 2019 operating results led to a $ 28.8 million increase in annual variable compensation , primarily bonus compensation , as well as a $ 9.5 million increase in non-cash stock-based compensation expense . these increases in compensation and related costs were offset in part by the absence of the one-time $ 9.0 million bonus paid to certain associates in the second quarter of 2018 and $ 10.0 million in higher labor capitalization related to internally developed software in 2019. distribution and servicing costs . distribution and servicing costs were $ 278.5 million for 2020 , an increase of $ 16.0 million , or 6.1 % , compared to 2019. the increase was primarily driven by higher distribution costs as a result of continued inflows into our international products , including our japanese itms and sicavs . these higher distribution costs were partially offset by client transfers , largely from advisor and r classes , to vehicles that do n't pay distribution and servicing costs . distribution and servicing costs were $ 262.5 million for 2019 , a decrease of $ 18.7 million , or 6.7 % , compared with 2018. the decrease was primarily driven by client transfers , largely from advisor and r classes , to vehicles that do n't pay distribution and servicing costs . distribution and servicing costs paid to third-party intermediaries that source the assets of certain share classes of our u.s. mutual funds and our international products , such as our japanese itms and sicavs , are recognized in this expense . both of these costs are offset entirely by the revenue we earn and report in net revenues : 12b-1 revenue recognized in administrative , distribution , and servicing fees for the u.s. mutual funds and investment advisory fee revenue for our international products . advertising and promotion . advertising and promotion costs were $ 83.7 million for 2020 , a decrease of $ 13.1 million , or 13.5 % , compared with 2019. the decrease was primarily driven by lower media costs and fewer conference and promotional events in 2020 as a result of cancellations arising from the coronavirus pandemic in 2020. for 2019 , advertising and promotion costs were $ 96.8 million , a decrease of $ 2.8 million , or 2.8 % , compared with 2018. the decrease in advertising and promotion costs for 2019 from 2018 is primarily driven by the absence in 2019 of the creation and launch of a media advertising campaign in 2018. product-related costs . product-related costs were $ 155.5 million for 2020 , an increase of $ 2.3 million , or 1.5 % , compared with 2019. the increase is primarily due to higher expenses related to servicing retirement plan products , partially offset by lower costs incurred to provide administrative services to the u.s. mutual funds . product-related costs were $ 153.2 million for 2019 , a decrease of $ 3.9 million , or 2.5 % , compared with 2018. the decrease is primarily due to lower costs incurred to provide administrative services to the u.s. mutual funds , partially offset by higher operating costs of our collective investment trusts as client transfers have increased the number of trusts and their average net assets over the last year . technology , occupancy , and facility costs . technology , occupancy , and facility costs were $ 444.8 million for 2020 , $ 427.3 million for 2019 , and $ 383.9 million for 2018. the increases over the last two years were due primarily to ongoing investment in our technology capabilities , including related depreciation and hosted solution licenses , as well as office expansion costs . the 2019 year included certain non-recurring office facility costs . general , administrative , and other costs . general , administrative , and other costs were $ 316.1 million for 2020 , $ 321.9 million for 2019 , and $ 296.0 million for 2018. higher third-party investment research costs , professional fees , 20 page 35 and other administrative related costs in 2020 were

cash flows from operating activities net income $ 1,837.5 $ ( 105.6 ) $ 36.8 $ 1,768.7 adjustments to reconcile net income to net cash provided by operating activities depreciation , amortization and impairments of property and equipment 159.5 — — 159.5 stock-based compensation expense 197.1 — — 197.1 net gains recognized on investments ( 13.7 ) — ( 36.8 ) ( 50.5 ) net investments in t. rowe price investment products used to economically hedge supplemental savings plan liability ( 129.5 ) ( 129.5 ) net change in trading securities held by consolidated t. rowe price investment products — ( 437.0 ) — ( 437.0 ) other changes in assets and liabilities 127.2 ( 6.5 ) ( 9.1 ) 111.6 net cash provided by ( used in ) operating activities 2,178.1 ( 549.1 ) ( 9.1 ) 1,619.9 net cash provided by ( used in ) investing activities ( 945.7 ) ( 23.8 ) 94.0 ( 875.5 ) net cash provided by ( used in ) financing activities ( 1,709.9 ) 555.3 ( 84.9 ) ( 1,239.5 ) effect of exchange rate changes on cash and cash equivalents of consolidated t. rowe price investment products — ( 15.4 ) — ( 15.4 ) net change in cash and cash equivalents during period ( 477.5 ) ( 33.0 ) — ( 510.5 ) cash and cash equivalents at beginning of year 1,902.7 103.1 — 2,005.8 cash and cash equivalents at end of period $ 1,425.2 $ < td style= '' background-color : # cceeff ; border-bottom:3pt double # 000000 ; border-top:1pt solid # 000000 ; padding:2px

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```cash flows from operating activities net income $ 1,837.5 $ ( 105.6 ) $ 36.8 $ 1,768.7 adjustments to reconcile net income to net cash provided by operating activities depreciation , amortization and impairments of property and equipment 159.5 — — 159.5 stock-based compensation expense 197.1 — — 197.1 net gains recognized on investments ( 13.7 ) — ( 36.8 ) ( 50.5 ) net investments in t. rowe price investment products used to economically hedge supplemental savings plan liability ( 129.5 ) ( 129.5 ) net change in trading securities held by consolidated t. rowe price investment products — ( 437.0 ) — ( 437.0 ) other changes in assets and liabilities 127.2 ( 6.5 ) ( 9.1 ) 111.6 net cash provided by ( used in ) operating activities 2,178.1 ( 549.1 ) ( 9.1 ) 1,619.9 net cash provided by ( used in ) investing activities ( 945.7 ) ( 23.8 ) 94.0 ( 875.5 ) net cash provided by ( used in ) financing activities ( 1,709.9 ) 555.3 ( 84.9 ) ( 1,239.5 ) effect of exchange rate changes on cash and cash equivalents of consolidated t. rowe price investment products — ( 15.4 ) — ( 15.4 ) net change in cash and cash equivalents during period ( 477.5 ) ( 33.0 ) — ( 510.5 ) cash and cash equivalents at beginning of year 1,902.7 103.1 — 2,005.8 cash and cash equivalents at end of period $ 1,425.2 $ < td style= '' background-color : # cceeff ; border-bottom:3pt double # 000000 ; border-top:1pt solid # 000000 ; padding:2px ``` Suspicious Activity Report : 20 page 25 returns of several major equity market indexes for 2020 are as follows : s & p 500 index 18.4 % nasdaq composite index ( 1 ) 43.6 % russell 2000 index 20.0 % msci eafe ( europe , australasia , and far east ) index 8.3 % msci emerging markets index 18.7 % ( 1 ) returns exclude dividends global bonds produced mostly positive returns , as central banks slashed short-term interest rates and sovereign bond yields in many countries fell sharply . in the u.s. investment-grade market , corporate bonds did best , as investors sought attractive yields in a low interest rate environment . treasury securities also did well as yields dropped across the yield curve . the 10-year u.s. treasury note yield decreased from 1.92 % to 0.93 % over the last year . asset- and mortgage-backed securities produced relatively mild gains . high yield corporate bonds and tax-free municipal bonds rose but trailed the broad taxable investment-grade bond market . bonds in developed non-u.s. markets produced strong gains in u.s. dollar terms , helped by dollar weakness against the euro and , to a lesser extent , the japanese yen and the british pound . bonds in developing markets generally appreciated in u.s. dollar terms , though local currency weakness in some countries , especially brazil , turkey , and russia , reduced local returns to u.s. investors . returns of several major bond market indexes for 2020 are as follows : bloomberg barclays u.s. aggregate bond index 7.5 % jpmorgan global high yield index 5.4 % bloomberg barclays municipal bond index 5.2 % bloomberg barclays global aggregate ex-u.s. dollar bond index 10.1 % jpmorgan emerging markets bond index plus 7.1 % assets under management . assets under management ended 2020 at $ 1,470.5 billion , an increase of $ 263.7 billion from the end of 2019. this increase was driven by market appreciation and income , net of distributions not reinvested , of $ 256.9 billion and net cash inflows of $ 5.6 billion for 2020. in addition , we acquired client contracts from pnc bank in september 2020 that added $ 1.2 billion of stable value assets under management . clients transferred $ 13.7 billion in net assets from the u.s. mutual funds to primarily collective investment trusts and other investment products , of which $ 8.6 billion transferred into the retirement date trusts . 20 page 26 the following table details changes in our assets under management by vehicle during the last three years : replace_table_token_6_th ( 1 ) in all three years , the majority of the client transfers were from the t. rowe price u.s. mutual funds to the t. rowe price collective investment trusts , which are included in collective investment trusts and other investment products . 20 page 27 the following table details changes in our assets under management by asset class during the last three years : replace_table_token_7_th ( 1 ) the underlying assets under management of the multi-asset portfolios have been aggregated and presented in this category and not reported in the equity and fixed income columns . ( 2 ) reported net of distributions not reinvested . investment advisory clients outside the u.s. account for 9.3 % of our assets under management at december 31 , 2020 and 6.9 % at december 31 , 2019. our net cash flows in 2020 reflect net positive flows due to inflows into fixed income and international equity . these inflows were partially offset by cash outflows in domestic equity and our multi-asset franchise resulting from macro-economic headwinds , including the cares act , and ongoing pressure from passive . in terms of equity products , the cash inflows from international equity offset the cash outflows from domestic equity products . from a geography perspective , emea and apac regions performed well with positive net flows predominantly in equity in both regions . net cash flows for 2019 , and 2018 were driven by diversified inflows across distribution channels and geographies , the strength of our multi-asset franchise , and positive flows into fixed income and international equity . our target date retirement products , which are included in the multi-asset totals shown above , continue to be a significant part of our assets under management . assets under management in our target date retirement products as well as net cash inflows/ ( outflows ) , by vehicle , are as follows : replace_table_token_8_th we provide participant accounting and plan administration for defined contribution retirement plans that invest in the firm 's u.s. mutual funds , collective investment trusts and funds outside of the firm 's complex . as of december 31 , 2020 , our assets under administration were $ 239 billion , of which nearly $ 148 billion are assets we manage . in recent years , we began offering non-discretionary advisory services through model delivery , which are managed accounts where portfolio holdings and trades in the portfolio are provided to sponsor platforms to implement for their clients . we record the revenue earned on these services in administrative fees . the assets under advisement in 20 page 28 these portfolios , predominantly in the united states , is $ 2.8 billion at december 31 , 2020. investment performance . strong investment performance and brand awareness is a key driver to attracting and retaining assets—and to our long-term success . beginning in the third quarter of 2020 , we expanded our performance disclosures to include specific assets classes , assets under management weighted performance , mutual fund performance against passive peers and composite performance against benchmarks . the following table presents investment performance for the one- , three- , five- , and 10-years ended december 31 , 2020. past performance is no guarantee of future results . story_separator_special_tag operating expenses replace_table_token_13_th ( 1 ) the percentage change in nonrecurring net recoveries related to dell appraisal rights matter is not meaningful ( n/m ) . compensation and related costs . compensation and related costs increased $ 213.2 million , or 10.8 % , for 2020 as compared with 2019. the increase in compensation and related costs was primarily due to an $ 83.0 million increase in salaries , benefits and related employee costs , as our average staff size increased 5.8 % from prior year and we made modest increases to base salaries at the beginning of the year . strong 2020 operating results led to a $ 65.5 million increase in our annual variable compensation , primarily bonus compensation , and higher stock-based 20 page 34 compensation expense . these increases in compensation and related costs were partially offset by $ 30.4 million in higher labor capitalization related to internally developed software in 2020. the $ 38.6 million in higher expense related to our supplemental savings plan from strong market returns is partially offset by the non-operating gains on the investments used to economically hedge the related liability . for 2019 , compensation and related costs increased $ 160.6 million , or 8.9 % , as compared with 2018. nearly half of the increase in compensation and related costs is attributable to $ 78.8 million in higher expense related to our supplemental savings plan given the strong equity market returns experienced in 2019 compared with the sharp equity market declines in late 2018. the higher expense related to the supplemental savings plan is partially offset by the non-operating gains earned on the investments used to economically hedge the related liability . we also experienced increases in base salaries , benefits , and related employee costs of $ 66.0 million , as our average staff size grew 3.1 % in 2019 and we modestly increased base salaries at the beginning of 2019. our 2019 operating results led to a $ 28.8 million increase in annual variable compensation , primarily bonus compensation , as well as a $ 9.5 million increase in non-cash stock-based compensation expense . these increases in compensation and related costs were offset in part by the absence of the one-time $ 9.0 million bonus paid to certain associates in the second quarter of 2018 and $ 10.0 million in higher labor capitalization related to internally developed software in 2019. distribution and servicing costs . distribution and servicing costs were $ 278.5 million for 2020 , an increase of $ 16.0 million , or 6.1 % , compared to 2019. the increase was primarily driven by higher distribution costs as a result of continued inflows into our international products , including our japanese itms and sicavs . these higher distribution costs were partially offset by client transfers , largely from advisor and r classes , to vehicles that do n't pay distribution and servicing costs . distribution and servicing costs were $ 262.5 million for 2019 , a decrease of $ 18.7 million , or 6.7 % , compared with 2018. the decrease was primarily driven by client transfers , largely from advisor and r classes , to vehicles that do n't pay distribution and servicing costs . distribution and servicing costs paid to third-party intermediaries that source the assets of certain share classes of our u.s. mutual funds and our international products , such as our japanese itms and sicavs , are recognized in this expense . both of these costs are offset entirely by the revenue we earn and report in net revenues : 12b-1 revenue recognized in administrative , distribution , and servicing fees for the u.s. mutual funds and investment advisory fee revenue for our international products . advertising and promotion . advertising and promotion costs were $ 83.7 million for 2020 , a decrease of $ 13.1 million , or 13.5 % , compared with 2019. the decrease was primarily driven by lower media costs and fewer conference and promotional events in 2020 as a result of cancellations arising from the coronavirus pandemic in 2020. for 2019 , advertising and promotion costs were $ 96.8 million , a decrease of $ 2.8 million , or 2.8 % , compared with 2018. the decrease in advertising and promotion costs for 2019 from 2018 is primarily driven by the absence in 2019 of the creation and launch of a media advertising campaign in 2018. product-related costs . product-related costs were $ 155.5 million for 2020 , an increase of $ 2.3 million , or 1.5 % , compared with 2019. the increase is primarily due to higher expenses related to servicing retirement plan products , partially offset by lower costs incurred to provide administrative services to the u.s. mutual funds . product-related costs were $ 153.2 million for 2019 , a decrease of $ 3.9 million , or 2.5 % , compared with 2018. the decrease is primarily due to lower costs incurred to provide administrative services to the u.s. mutual funds , partially offset by higher operating costs of our collective investment trusts as client transfers have increased the number of trusts and their average net assets over the last year . technology , occupancy , and facility costs . technology , occupancy , and facility costs were $ 444.8 million for 2020 , $ 427.3 million for 2019 , and $ 383.9 million for 2018. the increases over the last two years were due primarily to ongoing investment in our technology capabilities , including related depreciation and hosted solution licenses , as well as office expansion costs . the 2019 year included certain non-recurring office facility costs . general , administrative , and other costs . general , administrative , and other costs were $ 316.1 million for 2020 , $ 321.9 million for 2019 , and $ 296.0 million for 2018. higher third-party investment research costs , professional fees , 20 page 35 and other administrative related costs in 2020 were

for financial reporting purposes , our operations are organized into four business segments : fertilizer products ( jinong ) , fertilizer products ( gufeng ) , agricultural products production ( jintai ) , and agricultural products production ( yuxing ) . jintai and yuxing also serve as a research and development base for our fertilizer products . the fertilizer business conducted by jinong and gufeng generated approximately 96.4 % , 96.1 % and 88.0 % of our total revenues in the fiscal year ended june 30 , 2012 , 2011 and 2010 , respectively . it should be noted that our consolidated results for the 2010 period do not include the results of gufeng and its subsidiary , tianjuyuan , which were acquired on july 2 , 2010 . 50 fertilizer products as of june 30 , 2012 , we had developed and produced a total of 443 different fertilizer products in use , of which 126 and 317 were developed and produced by jinong and gufeng , respectively . below is a table that shows the metric tons of fertilizer sold by jinong and gufeng and the revenue per ton for the periods indicated : replace_table_token_12_th replace_table_token_13_th replace_table_token_14_th replace_table_token_15_th for the fiscal year ended june 30 , 2012 , we sold approximately 318,208 metric tons of fertilizer products , as compared to 337,769 metric tons and 22,834 metric tons for the fiscal year ended june 30 , 2011 and 2010 , respectively , which did not include sales of products by gufeng with respect to the number of metric tons we sold in 2010. for the fiscal year ended june 30 , 2012 , jinong sold approximately 61,590 metric tons of fertilizer products , as compared to 48,038 metric tons and 22,834 for the fiscal year ended june 30 , 2011 and 2010 , respectively . for the fiscal year ended june 30 , 2012 , gufeng sold approximately 256,618 metric tons of fertilizer products , as compared to 289,731 metric tons for the fiscal year ended june 30 , 2011. our sales of fertilizer products to five provinces accounted for approximately 58.9 % of our fertilizer revenue for the fiscal year ended june 30 , 2012. specifically , the provinces and their respective percentage contribution to our fertilizer revenues were beijing ( 24.2 % ) , hebei ( 16.3 % ) , jilin ( 9.0 % ) , liaoning ( 6.6 % ) and inner mongolia ( 2.8 % ) . as of june 30 , 2012 , we had a total of 943 distributors covering 22 provinces , four autonomous regions and three central government-controlled municipalities in china . jinong had 758 distributors in china . jinong 's sales are not dependent on any single distributor or any group of distributors . its top five distributors accounted for 2.1 % of jinong 's fertilizer revenues for the fiscal year ended june 30 , 2012. gufeng had 185 distributors , including some large state-owned enterprises . gufeng 's top five distributors accounted for 47.0 % of its revenues for the fiscal year ended june 30 , 2012 , of which sinoagri holding company limited accounted for 25.8 % of gufeng 's revenue for the fiscal year ended june 30 , 2012. agricultural products through jintai , we develop , produce and sell high-quality flowers , green vegetables and fruits to local marketplaces and various horticulture and planting companies . we also use certain of jintai 's and yuxing 's greenhouse facilities to conduct research and development activities for our fertilizer products . the three prc provinces that accounted for 99.5 % of our agricultural products revenue for the fiscal year ended june 30 , 2012 were shaanxi ( 92.0 % ) , ningxia ( 6.5 % ) and guangdong ( 0.9 % ) . 51 recent developments new products during the three months ended june 30 , 2012 , jinong launched seven new fertilizer products , which included five broad-spectrum and two powder fertilizer products . jinong 's new products generated approximately $ 115,256 , or 0.5 % of jinong 's fertilizer revenues for the three months ended june 30 , 2012. jinong also added 46 new distributors for the three months ended june 30 , 2012. jinong 's new distributors accounted for approximately $ 1,706,005 , or 6.9 % of jinong 's fertilizer revenues for the three months ended june 30 , 2012. jinong 's revenue attributable to the new products distributed by its new distributors was approximately $ 44,110 , or 0.2 % of jinong 's fertilizer revenues for the three months ended june 30 , 2012. during the three months ended june 30 , 2012 , gufeng launched no new fertilizer product . gufeng added three new distributors during the three months ended june 30 , 2012 , which accounted for approximately $ 475,410 , or 1.5 % , of gufeng 's fertilizer revenues . jintai 's relocation we have started to relocate jintai to the facilities of one of the company 's other subsidiaries-yuxing , located in hu county , xi'an . yuxing 's facilities are approximately a one hour drive south of jintai 's current location in the economic and technical development zone ( the `` zone `` ) in the metro area of the city of xi'an . as mentioned in the company 's previous quarterly reports , with the rapid growth of urbanization in xi'an , the zone has been inhabited by a large and dense population and the periphery of jintai has bristled with various industrial factories and utility plants . the zone 's concentrated industrial activities and dense population changed the micro bioenvironment for the growth of jintai 's agricultural products and disturbed jintai 's normal fertilizer research and development . recently such changes caused the death and obsolescence of large amount of jintai 's flowers and seedlings . story_separator_special_tag the main reason for the decrease in jinong 's gross profit margin was primarily attributable to the strong sales of lower-margin granular fertilizers for the fiscal year ended june 30 , 2011 compared with a year ago . in addition , the increase in the price of raw materials also contributed to the lower margin than before . 57 gross profit generated by gufeng was $ 21,410,028 with a gross profit margin of approximately 20.0 % for the fiscal year ended june 30 , 2011. gross profit from jintai increased by $ 149,187 , or 5.3 % , for the fiscal year ended june 30 , 2011 , to $ 2,985,542 , as compared to $ 2,836,355 for the fiscal year ended june 30 , 2010. gross profit margin from jintai 's sales was approximately 43.7 % and 45.2 % for the fiscal years ended june 30 , 2011 and 2010 , respectively . gross profit from yuxing was $ 44,317 with a gross profit margin of approximately 24.5 % for the fiscal years ended june 30 , 2011. selling expenses our selling expenses consist primarily of salaries of sales personnel , advertising and promotion expenses , freight-out costs and related compensation . selling expenses were $ 7,121,905 , or 4.0 % , of net sales for the fiscal year ended june 30 , 2011 as compared to $ 2,203,345 or 4.2 % of net sales for the fiscal year ended june 30 , 2010 , an increase of $ 4,918,560 , or 223.2 % . this increase was primarily due to the inclusion of gufeng 's selling expenses for fiscal year 2011. the selling expenses of gufeng were $ 2,834,005 , or 2.6 % of gufeng 's net sales . the total selling expenses for the fiscal year ended june 30 , 2011 without including gufeng 's selling expenses was $ 4,287,900 , or 5.9 % of net sales excluding gufeng 's net sales . the selling expenses of jinong for the fiscal year ended june 30 , 2011 were $ 4,254,198 , or 6.5 % of jinong 's net sales , compared to selling expenses of $ 2,176,881 , or 4.8 % of jinong 's net sales in fiscal year 2010. most of this increase was due to jinong 's expanded marketing efforts such as promotional materials and the increase in shipping costs . general and administrative expenses general and administrative expenses consisted primarily of related salaries , rental expenses , business development , depreciation and travel expenses incurred by our general and administrative departments and legal and professional expenses including expenses incurred and accrued due to pending litigations . general and administrative expenses were $ 14,386,699 , or 8.0 % of net sales , for the fiscal year ended june 30 , 2011 , as compared to $ 3,822,234 , or 7.3 % , of net sales for the fiscal year ended june 30 2010 , an increase of $ 10,564,465. this increase was primarily the result of the inclusion of gufeng 's general and administrative expenses , stock compensation expenses , jintai 's photinia fraseri seedlings becoming obsolete and additional legal and investor relations fees incurred in connection with certain pending litigations . the general and administrative expenses of gufeng were $ 3,287,152 for the fiscal year ended june 30 , 2011. in addition , the non-cash stock compensation expense was $ 3,605,235 for the fiscal year ended june 30 , 2011. total other income ( expenses ) total other income ( expense ) consisted of income from subsidies received from the prc government , interest income , interest expenses and bank charges . total other expense for the fiscal year ended june 30 , 2011 was $ 160,186 , as compared to total other income of $ 157,653 for the fiscal year ended june 30 , 2010 , an increase in expense of $ 317,839 , or 201.6 % . the increase was mainly attributable to the $ 466,912 interest expense from gufeng 's outstanding short-term loans . income taxes jinong is subject to a preferred tax rate of 15 % as a result of its business being classified as a high-tech project under the prc enterprise income tax law ( “ eit ” ) that became effective on january 1 , 2008. jinong incurred income tax expenses of $ 5,157,184 for the fiscal year ended june 30 , 2011 , as compared to $ 3,794,515 for the fiscal year ended june 30 , 2010 , an increase of $ 1,362,669 , or 35.9 % , which was primarily attributable to jinong 's increased operating income . gufeng , subject to a tax rate of 25 % , incurred income tax expenses of $ 3,879,959 for the fiscal year ended june 30 , 2011. jintai and yuxing are currently exempted under prc regulations from paying income tax . 58 net income net income for the fiscal year ended june 30 , 2011 was $ 32,914,101 , an increase of $ 11,624,343 , or 54.6 % , compared to $ 21,289,758 for the fiscal year ended june 30 , 2010. the increase was attributable to the increase in gross profit . net income as a percentage of total net sales was approximately 18.2 % and 40.9 % for the fiscal year ended june 30 , 2011 and 2010 , respectively . discussion of segment profitability measures as of june 30 , 2012 , we were engaged in the following businesses : the production and sale of fertilizers through jinong and gufeng and the production and sale of high-quality agricultural products by jintai and yuxing . for financial reporting purposes , our operations were organized into four main business segments based on location and product : jinong ( fertilizer production ) , gufeng ( fertilizer production ) , jintai ( agricultural products production ) and yuxing ( agricultural products production ) . each of the segments has its own annual budget with regard to development , production

liquidity and capital resources our principal sources of liquidity include cash from operations , borrowings from local commercial banks and net proceeds of offerings of our securities consummated in july 2009 and november/december 2009 ( collectively the “ public offerings ” ) . as of june 30 , 2012 , cash and cash equivalents were $ 71,978,630 , an increase of $ 6,372,217 and $ 3,270,976 , or 9.7 % and 5.2 % , respectively , from $ 65,606,413 and $ 62,335,437 as of june 30 , 2011 and 2010 , respectively . we intend to use some of the remaining net proceeds from the public offerings ( approximately $ 8.5 million ) , as well as other working capital if required , to acquire new businesses , upgrade production lines and complete yuxing 's new greenhouse facilities for agriculture products located on 88 acres of land in hu county , 18 kilometers southeast of xi'an city . we believe that we have sufficient cash on hand and positive projected cash flow from operations to support our business growth for the next twelve months to the extent we do not have further significant acquisitions or expansions . however , if events or circumstances occur and we do not meet our operating plan as expected , we may be required to seek additional capital and or to reduce certain discretionary spending , which could have a material adverse effect on our ability to achieve our businessobjectives .

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Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```liquidity and capital resources our principal sources of liquidity include cash from operations , borrowings from local commercial banks and net proceeds of offerings of our securities consummated in july 2009 and november/december 2009 ( collectively the “ public offerings ” ) . as of june 30 , 2012 , cash and cash equivalents were $ 71,978,630 , an increase of $ 6,372,217 and $ 3,270,976 , or 9.7 % and 5.2 % , respectively , from $ 65,606,413 and $ 62,335,437 as of june 30 , 2011 and 2010 , respectively . we intend to use some of the remaining net proceeds from the public offerings ( approximately $ 8.5 million ) , as well as other working capital if required , to acquire new businesses , upgrade production lines and complete yuxing 's new greenhouse facilities for agriculture products located on 88 acres of land in hu county , 18 kilometers southeast of xi'an city . we believe that we have sufficient cash on hand and positive projected cash flow from operations to support our business growth for the next twelve months to the extent we do not have further significant acquisitions or expansions . however , if events or circumstances occur and we do not meet our operating plan as expected , we may be required to seek additional capital and or to reduce certain discretionary spending , which could have a material adverse effect on our ability to achieve our businessobjectives . ``` Suspicious Activity Report : for financial reporting purposes , our operations are organized into four business segments : fertilizer products ( jinong ) , fertilizer products ( gufeng ) , agricultural products production ( jintai ) , and agricultural products production ( yuxing ) . jintai and yuxing also serve as a research and development base for our fertilizer products . the fertilizer business conducted by jinong and gufeng generated approximately 96.4 % , 96.1 % and 88.0 % of our total revenues in the fiscal year ended june 30 , 2012 , 2011 and 2010 , respectively . it should be noted that our consolidated results for the 2010 period do not include the results of gufeng and its subsidiary , tianjuyuan , which were acquired on july 2 , 2010 . 50 fertilizer products as of june 30 , 2012 , we had developed and produced a total of 443 different fertilizer products in use , of which 126 and 317 were developed and produced by jinong and gufeng , respectively . below is a table that shows the metric tons of fertilizer sold by jinong and gufeng and the revenue per ton for the periods indicated : replace_table_token_12_th replace_table_token_13_th replace_table_token_14_th replace_table_token_15_th for the fiscal year ended june 30 , 2012 , we sold approximately 318,208 metric tons of fertilizer products , as compared to 337,769 metric tons and 22,834 metric tons for the fiscal year ended june 30 , 2011 and 2010 , respectively , which did not include sales of products by gufeng with respect to the number of metric tons we sold in 2010. for the fiscal year ended june 30 , 2012 , jinong sold approximately 61,590 metric tons of fertilizer products , as compared to 48,038 metric tons and 22,834 for the fiscal year ended june 30 , 2011 and 2010 , respectively . for the fiscal year ended june 30 , 2012 , gufeng sold approximately 256,618 metric tons of fertilizer products , as compared to 289,731 metric tons for the fiscal year ended june 30 , 2011. our sales of fertilizer products to five provinces accounted for approximately 58.9 % of our fertilizer revenue for the fiscal year ended june 30 , 2012. specifically , the provinces and their respective percentage contribution to our fertilizer revenues were beijing ( 24.2 % ) , hebei ( 16.3 % ) , jilin ( 9.0 % ) , liaoning ( 6.6 % ) and inner mongolia ( 2.8 % ) . as of june 30 , 2012 , we had a total of 943 distributors covering 22 provinces , four autonomous regions and three central government-controlled municipalities in china . jinong had 758 distributors in china . jinong 's sales are not dependent on any single distributor or any group of distributors . its top five distributors accounted for 2.1 % of jinong 's fertilizer revenues for the fiscal year ended june 30 , 2012. gufeng had 185 distributors , including some large state-owned enterprises . gufeng 's top five distributors accounted for 47.0 % of its revenues for the fiscal year ended june 30 , 2012 , of which sinoagri holding company limited accounted for 25.8 % of gufeng 's revenue for the fiscal year ended june 30 , 2012. agricultural products through jintai , we develop , produce and sell high-quality flowers , green vegetables and fruits to local marketplaces and various horticulture and planting companies . we also use certain of jintai 's and yuxing 's greenhouse facilities to conduct research and development activities for our fertilizer products . the three prc provinces that accounted for 99.5 % of our agricultural products revenue for the fiscal year ended june 30 , 2012 were shaanxi ( 92.0 % ) , ningxia ( 6.5 % ) and guangdong ( 0.9 % ) . 51 recent developments new products during the three months ended june 30 , 2012 , jinong launched seven new fertilizer products , which included five broad-spectrum and two powder fertilizer products . jinong 's new products generated approximately $ 115,256 , or 0.5 % of jinong 's fertilizer revenues for the three months ended june 30 , 2012. jinong also added 46 new distributors for the three months ended june 30 , 2012. jinong 's new distributors accounted for approximately $ 1,706,005 , or 6.9 % of jinong 's fertilizer revenues for the three months ended june 30 , 2012. jinong 's revenue attributable to the new products distributed by its new distributors was approximately $ 44,110 , or 0.2 % of jinong 's fertilizer revenues for the three months ended june 30 , 2012. during the three months ended june 30 , 2012 , gufeng launched no new fertilizer product . gufeng added three new distributors during the three months ended june 30 , 2012 , which accounted for approximately $ 475,410 , or 1.5 % , of gufeng 's fertilizer revenues . jintai 's relocation we have started to relocate jintai to the facilities of one of the company 's other subsidiaries-yuxing , located in hu county , xi'an . yuxing 's facilities are approximately a one hour drive south of jintai 's current location in the economic and technical development zone ( the `` zone `` ) in the metro area of the city of xi'an . as mentioned in the company 's previous quarterly reports , with the rapid growth of urbanization in xi'an , the zone has been inhabited by a large and dense population and the periphery of jintai has bristled with various industrial factories and utility plants . the zone 's concentrated industrial activities and dense population changed the micro bioenvironment for the growth of jintai 's agricultural products and disturbed jintai 's normal fertilizer research and development . recently such changes caused the death and obsolescence of large amount of jintai 's flowers and seedlings . story_separator_special_tag the main reason for the decrease in jinong 's gross profit margin was primarily attributable to the strong sales of lower-margin granular fertilizers for the fiscal year ended june 30 , 2011 compared with a year ago . in addition , the increase in the price of raw materials also contributed to the lower margin than before . 57 gross profit generated by gufeng was $ 21,410,028 with a gross profit margin of approximately 20.0 % for the fiscal year ended june 30 , 2011. gross profit from jintai increased by $ 149,187 , or 5.3 % , for the fiscal year ended june 30 , 2011 , to $ 2,985,542 , as compared to $ 2,836,355 for the fiscal year ended june 30 , 2010. gross profit margin from jintai 's sales was approximately 43.7 % and 45.2 % for the fiscal years ended june 30 , 2011 and 2010 , respectively . gross profit from yuxing was $ 44,317 with a gross profit margin of approximately 24.5 % for the fiscal years ended june 30 , 2011. selling expenses our selling expenses consist primarily of salaries of sales personnel , advertising and promotion expenses , freight-out costs and related compensation . selling expenses were $ 7,121,905 , or 4.0 % , of net sales for the fiscal year ended june 30 , 2011 as compared to $ 2,203,345 or 4.2 % of net sales for the fiscal year ended june 30 , 2010 , an increase of $ 4,918,560 , or 223.2 % . this increase was primarily due to the inclusion of gufeng 's selling expenses for fiscal year 2011. the selling expenses of gufeng were $ 2,834,005 , or 2.6 % of gufeng 's net sales . the total selling expenses for the fiscal year ended june 30 , 2011 without including gufeng 's selling expenses was $ 4,287,900 , or 5.9 % of net sales excluding gufeng 's net sales . the selling expenses of jinong for the fiscal year ended june 30 , 2011 were $ 4,254,198 , or 6.5 % of jinong 's net sales , compared to selling expenses of $ 2,176,881 , or 4.8 % of jinong 's net sales in fiscal year 2010. most of this increase was due to jinong 's expanded marketing efforts such as promotional materials and the increase in shipping costs . general and administrative expenses general and administrative expenses consisted primarily of related salaries , rental expenses , business development , depreciation and travel expenses incurred by our general and administrative departments and legal and professional expenses including expenses incurred and accrued due to pending litigations . general and administrative expenses were $ 14,386,699 , or 8.0 % of net sales , for the fiscal year ended june 30 , 2011 , as compared to $ 3,822,234 , or 7.3 % , of net sales for the fiscal year ended june 30 2010 , an increase of $ 10,564,465. this increase was primarily the result of the inclusion of gufeng 's general and administrative expenses , stock compensation expenses , jintai 's photinia fraseri seedlings becoming obsolete and additional legal and investor relations fees incurred in connection with certain pending litigations . the general and administrative expenses of gufeng were $ 3,287,152 for the fiscal year ended june 30 , 2011. in addition , the non-cash stock compensation expense was $ 3,605,235 for the fiscal year ended june 30 , 2011. total other income ( expenses ) total other income ( expense ) consisted of income from subsidies received from the prc government , interest income , interest expenses and bank charges . total other expense for the fiscal year ended june 30 , 2011 was $ 160,186 , as compared to total other income of $ 157,653 for the fiscal year ended june 30 , 2010 , an increase in expense of $ 317,839 , or 201.6 % . the increase was mainly attributable to the $ 466,912 interest expense from gufeng 's outstanding short-term loans . income taxes jinong is subject to a preferred tax rate of 15 % as a result of its business being classified as a high-tech project under the prc enterprise income tax law ( “ eit ” ) that became effective on january 1 , 2008. jinong incurred income tax expenses of $ 5,157,184 for the fiscal year ended june 30 , 2011 , as compared to $ 3,794,515 for the fiscal year ended june 30 , 2010 , an increase of $ 1,362,669 , or 35.9 % , which was primarily attributable to jinong 's increased operating income . gufeng , subject to a tax rate of 25 % , incurred income tax expenses of $ 3,879,959 for the fiscal year ended june 30 , 2011. jintai and yuxing are currently exempted under prc regulations from paying income tax . 58 net income net income for the fiscal year ended june 30 , 2011 was $ 32,914,101 , an increase of $ 11,624,343 , or 54.6 % , compared to $ 21,289,758 for the fiscal year ended june 30 , 2010. the increase was attributable to the increase in gross profit . net income as a percentage of total net sales was approximately 18.2 % and 40.9 % for the fiscal year ended june 30 , 2011 and 2010 , respectively . discussion of segment profitability measures as of june 30 , 2012 , we were engaged in the following businesses : the production and sale of fertilizers through jinong and gufeng and the production and sale of high-quality agricultural products by jintai and yuxing . for financial reporting purposes , our operations were organized into four main business segments based on location and product : jinong ( fertilizer production ) , gufeng ( fertilizer production ) , jintai ( agricultural products production ) and yuxing ( agricultural products production ) . each of the segments has its own annual budget with regard to development , production

since these measures do not incorporate revenues , changes in working capital and non-operating cash costs , they are not necessarily indicative of operating profit or cash flow from operations as determined under gaap . changes in numerous factors including , but not limited to , mining rates , milling rates , gold grade , gold recovery , and the costs of labor , consumables and mine site general and administrative activities can cause these measures to increase or decrease . we believe that these measures are the same or similar to the measures of other gold mining companies , but may not be comparable to similarly titled measures in every instance . all figures and amounts in this item 7 are shown on a 100 % basis , which represents our current beneficial interest in gold production and revenues . once all capital has been repaid , the government of ghana would receive 10 % of the dividends from the subsidiaries owning the bogoso/prestea and wassa mines . our business through our subsidiaries and joint ventures we own a controlling interest in three significant gold properties in southern ghana in west africa : the bogoso/prestea property ( “bogoso/prestea” ) , the wassa property ( “wassa” ) and the prestea underground property ( “prestea underground” ) . bogoso and prestea are adjoining properties , operating as a single operation and referred to as “bogoso/prestea” . bogoso/prestea and the prestea underground are owned by our 90 % owned subsidiary bogoso gold limited ( “bgl” ) . in 2004 we sold 147,875 ounces of gold from bogoso/prestea for an average gold price of approximately $ 410 per ounce having a cash operating cost of approximately $ 250 per ounce . essentially all of our gold production to date has come from bogoso/prestea . through another 90 % owned subsidiary , wexford goldfields limited ( “wgl” ) , we own the wassa gold property , located some 35 kilometers east of bogoso/prestea . a newly constructed ore processing plant at wassa is now in its commissioning and testing phase , processing heap leach materials left by a former owner . we expect that the new plant will achieve its full design capacity of 10,000 tonnes per day in the first quarter of 2005. the prestea underground is located on the prestea property and consists of a currently inactive underground gold mine and associated support facilities . as of december 31 , 2004 , bgl , our 90 % owned subsidiary , owned a 90 % operating interest in this mine . we are currently seeking to determine if the underground mine can be reactivated on a profitable basis . we hold interests in exploration joint ventures , managed by joint venture partners , in mali and sierra leone in west africa and hold active exploration properties in ghana , suriname and french guiana . we hold interests in gold exploration properties in peru and chile through our affiliate goldmin holdings , and in the democratic republic of the congo through an investment in moto goldmines limited . our corporate headquarters is located in littleton , colorado . our accounting records are kept in compliance with canadian gaap and all of our operations , except for the french guiana office , transact business in us dollars and keep financial records in us dollars . business strategy and development since 1999 our business and development strategy has been focused primarily on the acquisition of producing and development stage gold properties in ghana and on the exploration , development and operation of these properties . we also explore for gold . since 1999 our exploration efforts have been focused on ghana , other west african countries and south america . we are currently carrying out technical and environmental studies to expand production at bogoso/prestea . we commenced development at wassa in mid-2003 , and expect it to be fully operational in early 2005. if the above mentioned expansion and development plans at bogoso/prestea are approved and permitted as expected , our annualized production is expected to range between 375,000 and 425,000 ounces of 52 gold by 2007. achievement of this target is subject to numerous risks . see the discussion of risk factors in item 1 above . our overall objective is to grow our business to become a mid-tier gold producer ( which we understand to be a producer with annual production of approximately 500,000 ounces ) over the next few years . as part of the effort to achieve our goal , we are actively investigating potential acquisition and merger candidates . however , we presently have no agreement or understanding with respect to any specific potential transaction . trends and events 2004 operational summary gold production totaled 147,875 ounces in 2004 , down from 174,315 ounces in 2003. production during 2004 was adversely affected by mining and processing difficulties experienced in the latter part of the year as the bogoso/prestea processing plant transitioned from oxide ores to transition and non-refractory sulfide ores which are not as well suited for processing in the bogoso plant as were the oxide ores milled earlier in the year . start-up difficulties with the new flotation circuit and unusually high rainfall during the second and third quarters also reduced mine output and hampered efficient plant operations . to compensate for the ore shortage , the bogoso plant supplemented the pit ore with stockpiled ores which were also not very well suited for processing in the bogoso plant . the net result was a lower processing rate and reduced gold recovery which in turn reduced gold output and sales revenues as compared to 2003. additional information on 2004 operations is contained below in the result of operations section . the lower revenues resulted in earnings of $ 2.6 million during 2004 , down from $ 22.0 million in 2003. earnings were also reduced by $ 4.1 million of expenses related to the iamgold tender offer . story_separator_special_tag cash operating costs averaged $ 250 per ounce , compared to $ 166 per ounce in 2003 , and total cash costs averaged $ 264 per ounce , up from $ 184 per ounce in 2003. depreciation and amortization were higher than in 2003 mostly due to the amortization costs of new assets added in late 2003 and in 2004 such as the flotation plant at bogoso . increases in corporate general and administrative costs contributed to the lower income versus 2003. higher compensation costs relating to additional administrative personnel relative to 2003 , increases in investor relations costs , higher insurance costs , sarbanes-oxley compliance costs and an overall higher level of corporate activity in response to the growth of the company all contributed to the increase in general and administrative costs . a $ 1.5 million tax benefit was recorded during 2004. recognition of a deferred tax asset was deemed appropriate at the end of 2004 in light of the continued ghanaian operating profits at bgl . we have substantial tax assets in canada and france mostly due to past losses , capital allowances and tax pools , but a tax valuation allowance has been provided in an amount equal to net tax assets in these jurisdictions . bogoso/prestea operations 2004 2003 2002 ore mined ( t ) 1,411,243 2,001,905 2,222,767 waste mined ( t ) 8,065,915 6,791,926 5,211,335 ore milled ( t ) 1,650,412 2,093,600 2,271,747 grade milled ( g/t ) 4.09 3.29 2.31 recovery ( % ) 67.3 81.2 74.4 story_separator_special_tag concentrates for over 18 years . a total of six biox ® operations have been successfully commissioned since commercialization of the process , of which four are still operating . two new biox ® plants are currently under construction , the suzdal plant in kazahstan and the fosterville plant in australia , which are scheduled for commissioning during 2005. four additional biox ® plants are now in various stages of development and are currently scheduled for commissioning during 2005 and 2006. one of the larger bio-oxidation plants which was built by grd minproc in the mid-1990s , is located at anglogold ashanti 's obuasi mine , which is also located on the ashanti gold trend , 130 kilometers northeast of bogoso/prestea . we believe that the sulfide mineralization at obuasi is similar to the bogoso/prestea material . our metallurgical assessment of the suitability of the bio-oxidation process for bogoso/prestea ores has been a four-year project . the work has involved metallurgical assessments on some 32 samples representative of the current sulfide reserves , including a flotation , biox ® and neutralization pilot plant program on a nine-tonne bulk sample compiled by the blending of approximately 90 diamond drill hole cores . 58 upon completion of the biox ® upgrade , the bogoso processing plant is expected to have a nominal capacity of 3.5 million tonnes per annum to process refractory sulfide ores from our bogoso and northern prestea pits , where we currently have proven and probable refractory reserves of approximately 20.5 million tonnes at an average grade of 2.81 grams per tonne . gold production from the bogoso mill , following a mining fleet upgrade and installation of the bogoso biox ® circuit , is expected to average approximately 270,000 ounces per annum and to vary between 260,000 to 290,000 ounces per annum at an average cash operating cost between $ 250 to $ 270 per ounce after commercial production is achieved in 2006. estimated gold recoveries from the biox ® process are expected to average 86 % and vary between 78 % and 88 % . wassa gold mine while we experienced significant construction delays during 2004 , the construction phase of the wassa project was substantially complete by december 31 , 2004 except for the power line which is now under construction and which we expect to complete by mid-year 2005. following discussions in november 2004 , our contract with mdm was terminated on november 29 , 2004. all of the required power line permits have been obtained , and all of the material power line construction equipment has been delivered and staged for construction or are on order . while the power line is still under construction , the existing powerhouse at wassa should generate all of the power needed to fully operate the plant and associated facilities until the connection to the local power grid is completed . as of december 31 , 2004 acquisition and development costs totaled $ 66.5 million including feasibility study costs , development drilling and geology , operating equipment and plant and site construction costs . the remaining project costs at december 31 , 2004 are estimated to be $ 7.0 million , consisting of $ 5.0 million for completion of the power line and $ 2.0 million for completion of miscellaneous items at the plant site . an additional $ 14 million is also budgeted in 2005 for purchase of additional mining equipment . during 2004 while testing and commissioning the mine we poured 5,292 ounces of gold resulting in $ 2.3 million of preproduction revenues which were credited against mine development costs . commissioning and testing of the new wassa processing plant began in late 2004. by december wassa had poured 5,292 ounces of gold resulting in $ 2.3 million of preproduction revenues which were credited against mine development costs . we expect wassa will achieve commercial production during the first quarter of 2005 , processing at its design capacity of approximately 10,000 tonnes per day . our 2005 mining plan involves processing most of the heap leach material left on the pads by the former owner which will furnish a low cost ore feed to the new plant during its first year of operations and will also clear the pad area for use as a tailings dam site . mining will be performed initially using a mixture of equipment transferred from bogoso/prestea and contract equipment until new equipment is procured . during

cash operating cost per ounce $ 250 $ 166 $ 193 royalties per ounce $ 14 $ 18 $ 22 total cash cost per ounce $ 264 $ 184 $ 215 the bogoso processing plant processed an average of 4,509 tonnes per day in 2004 , down from 5,736 tonnes per day in 2003. all of the ore processed in 2004 came from the plant-north ore body and from old bogoso transition ore stockpiles . the average ore grade processed in 2004 was 4.09 grams per tonne , up from 3.29 grams per tonne in 2003 , but gold recovery dropped to 67.3 % from 81 % in 2003. lower recovery was directly related to the non-refractory sulfide ores and to the transition ores which typically have lower recoveries than the oxide ores milled in 2003 . 2003 compared to 2002 net income totaled $ 22.0 million or $ 0.198 per share on revenues of $ 64.4 million for 2003 , versus net income of $ 4.9 million or $ 0.067 per share on revenues of $ 38.8 million during 2002. higher gold prices , increased gold production , a $ 2.3 million gain on currency exchange rates and a $ 1.9 million gain on the sale of marketable securities were the major factors contributing to the earnings improvement . realized gold prices averaged $ 364 per ounce for the year , a 17 % increase from the $ 311 per ounce realized in 2002. a weakened us dollar in 2003 versus most other major world currencies is thought to be responsible for much of the increased gold price during 2003 .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```cash operating cost per ounce $ 250 $ 166 $ 193 royalties per ounce $ 14 $ 18 $ 22 total cash cost per ounce $ 264 $ 184 $ 215 the bogoso processing plant processed an average of 4,509 tonnes per day in 2004 , down from 5,736 tonnes per day in 2003. all of the ore processed in 2004 came from the plant-north ore body and from old bogoso transition ore stockpiles . the average ore grade processed in 2004 was 4.09 grams per tonne , up from 3.29 grams per tonne in 2003 , but gold recovery dropped to 67.3 % from 81 % in 2003. lower recovery was directly related to the non-refractory sulfide ores and to the transition ores which typically have lower recoveries than the oxide ores milled in 2003 . 2003 compared to 2002 net income totaled $ 22.0 million or $ 0.198 per share on revenues of $ 64.4 million for 2003 , versus net income of $ 4.9 million or $ 0.067 per share on revenues of $ 38.8 million during 2002. higher gold prices , increased gold production , a $ 2.3 million gain on currency exchange rates and a $ 1.9 million gain on the sale of marketable securities were the major factors contributing to the earnings improvement . realized gold prices averaged $ 364 per ounce for the year , a 17 % increase from the $ 311 per ounce realized in 2002. a weakened us dollar in 2003 versus most other major world currencies is thought to be responsible for much of the increased gold price during 2003 . ``` Suspicious Activity Report : since these measures do not incorporate revenues , changes in working capital and non-operating cash costs , they are not necessarily indicative of operating profit or cash flow from operations as determined under gaap . changes in numerous factors including , but not limited to , mining rates , milling rates , gold grade , gold recovery , and the costs of labor , consumables and mine site general and administrative activities can cause these measures to increase or decrease . we believe that these measures are the same or similar to the measures of other gold mining companies , but may not be comparable to similarly titled measures in every instance . all figures and amounts in this item 7 are shown on a 100 % basis , which represents our current beneficial interest in gold production and revenues . once all capital has been repaid , the government of ghana would receive 10 % of the dividends from the subsidiaries owning the bogoso/prestea and wassa mines . our business through our subsidiaries and joint ventures we own a controlling interest in three significant gold properties in southern ghana in west africa : the bogoso/prestea property ( “bogoso/prestea” ) , the wassa property ( “wassa” ) and the prestea underground property ( “prestea underground” ) . bogoso and prestea are adjoining properties , operating as a single operation and referred to as “bogoso/prestea” . bogoso/prestea and the prestea underground are owned by our 90 % owned subsidiary bogoso gold limited ( “bgl” ) . in 2004 we sold 147,875 ounces of gold from bogoso/prestea for an average gold price of approximately $ 410 per ounce having a cash operating cost of approximately $ 250 per ounce . essentially all of our gold production to date has come from bogoso/prestea . through another 90 % owned subsidiary , wexford goldfields limited ( “wgl” ) , we own the wassa gold property , located some 35 kilometers east of bogoso/prestea . a newly constructed ore processing plant at wassa is now in its commissioning and testing phase , processing heap leach materials left by a former owner . we expect that the new plant will achieve its full design capacity of 10,000 tonnes per day in the first quarter of 2005. the prestea underground is located on the prestea property and consists of a currently inactive underground gold mine and associated support facilities . as of december 31 , 2004 , bgl , our 90 % owned subsidiary , owned a 90 % operating interest in this mine . we are currently seeking to determine if the underground mine can be reactivated on a profitable basis . we hold interests in exploration joint ventures , managed by joint venture partners , in mali and sierra leone in west africa and hold active exploration properties in ghana , suriname and french guiana . we hold interests in gold exploration properties in peru and chile through our affiliate goldmin holdings , and in the democratic republic of the congo through an investment in moto goldmines limited . our corporate headquarters is located in littleton , colorado . our accounting records are kept in compliance with canadian gaap and all of our operations , except for the french guiana office , transact business in us dollars and keep financial records in us dollars . business strategy and development since 1999 our business and development strategy has been focused primarily on the acquisition of producing and development stage gold properties in ghana and on the exploration , development and operation of these properties . we also explore for gold . since 1999 our exploration efforts have been focused on ghana , other west african countries and south america . we are currently carrying out technical and environmental studies to expand production at bogoso/prestea . we commenced development at wassa in mid-2003 , and expect it to be fully operational in early 2005. if the above mentioned expansion and development plans at bogoso/prestea are approved and permitted as expected , our annualized production is expected to range between 375,000 and 425,000 ounces of 52 gold by 2007. achievement of this target is subject to numerous risks . see the discussion of risk factors in item 1 above . our overall objective is to grow our business to become a mid-tier gold producer ( which we understand to be a producer with annual production of approximately 500,000 ounces ) over the next few years . as part of the effort to achieve our goal , we are actively investigating potential acquisition and merger candidates . however , we presently have no agreement or understanding with respect to any specific potential transaction . trends and events 2004 operational summary gold production totaled 147,875 ounces in 2004 , down from 174,315 ounces in 2003. production during 2004 was adversely affected by mining and processing difficulties experienced in the latter part of the year as the bogoso/prestea processing plant transitioned from oxide ores to transition and non-refractory sulfide ores which are not as well suited for processing in the bogoso plant as were the oxide ores milled earlier in the year . start-up difficulties with the new flotation circuit and unusually high rainfall during the second and third quarters also reduced mine output and hampered efficient plant operations . to compensate for the ore shortage , the bogoso plant supplemented the pit ore with stockpiled ores which were also not very well suited for processing in the bogoso plant . the net result was a lower processing rate and reduced gold recovery which in turn reduced gold output and sales revenues as compared to 2003. additional information on 2004 operations is contained below in the result of operations section . the lower revenues resulted in earnings of $ 2.6 million during 2004 , down from $ 22.0 million in 2003. earnings were also reduced by $ 4.1 million of expenses related to the iamgold tender offer . story_separator_special_tag cash operating costs averaged $ 250 per ounce , compared to $ 166 per ounce in 2003 , and total cash costs averaged $ 264 per ounce , up from $ 184 per ounce in 2003. depreciation and amortization were higher than in 2003 mostly due to the amortization costs of new assets added in late 2003 and in 2004 such as the flotation plant at bogoso . increases in corporate general and administrative costs contributed to the lower income versus 2003. higher compensation costs relating to additional administrative personnel relative to 2003 , increases in investor relations costs , higher insurance costs , sarbanes-oxley compliance costs and an overall higher level of corporate activity in response to the growth of the company all contributed to the increase in general and administrative costs . a $ 1.5 million tax benefit was recorded during 2004. recognition of a deferred tax asset was deemed appropriate at the end of 2004 in light of the continued ghanaian operating profits at bgl . we have substantial tax assets in canada and france mostly due to past losses , capital allowances and tax pools , but a tax valuation allowance has been provided in an amount equal to net tax assets in these jurisdictions . bogoso/prestea operations 2004 2003 2002 ore mined ( t ) 1,411,243 2,001,905 2,222,767 waste mined ( t ) 8,065,915 6,791,926 5,211,335 ore milled ( t ) 1,650,412 2,093,600 2,271,747 grade milled ( g/t ) 4.09 3.29 2.31 recovery ( % ) 67.3 81.2 74.4 story_separator_special_tag concentrates for over 18 years . a total of six biox ® operations have been successfully commissioned since commercialization of the process , of which four are still operating . two new biox ® plants are currently under construction , the suzdal plant in kazahstan and the fosterville plant in australia , which are scheduled for commissioning during 2005. four additional biox ® plants are now in various stages of development and are currently scheduled for commissioning during 2005 and 2006. one of the larger bio-oxidation plants which was built by grd minproc in the mid-1990s , is located at anglogold ashanti 's obuasi mine , which is also located on the ashanti gold trend , 130 kilometers northeast of bogoso/prestea . we believe that the sulfide mineralization at obuasi is similar to the bogoso/prestea material . our metallurgical assessment of the suitability of the bio-oxidation process for bogoso/prestea ores has been a four-year project . the work has involved metallurgical assessments on some 32 samples representative of the current sulfide reserves , including a flotation , biox ® and neutralization pilot plant program on a nine-tonne bulk sample compiled by the blending of approximately 90 diamond drill hole cores . 58 upon completion of the biox ® upgrade , the bogoso processing plant is expected to have a nominal capacity of 3.5 million tonnes per annum to process refractory sulfide ores from our bogoso and northern prestea pits , where we currently have proven and probable refractory reserves of approximately 20.5 million tonnes at an average grade of 2.81 grams per tonne . gold production from the bogoso mill , following a mining fleet upgrade and installation of the bogoso biox ® circuit , is expected to average approximately 270,000 ounces per annum and to vary between 260,000 to 290,000 ounces per annum at an average cash operating cost between $ 250 to $ 270 per ounce after commercial production is achieved in 2006. estimated gold recoveries from the biox ® process are expected to average 86 % and vary between 78 % and 88 % . wassa gold mine while we experienced significant construction delays during 2004 , the construction phase of the wassa project was substantially complete by december 31 , 2004 except for the power line which is now under construction and which we expect to complete by mid-year 2005. following discussions in november 2004 , our contract with mdm was terminated on november 29 , 2004. all of the required power line permits have been obtained , and all of the material power line construction equipment has been delivered and staged for construction or are on order . while the power line is still under construction , the existing powerhouse at wassa should generate all of the power needed to fully operate the plant and associated facilities until the connection to the local power grid is completed . as of december 31 , 2004 acquisition and development costs totaled $ 66.5 million including feasibility study costs , development drilling and geology , operating equipment and plant and site construction costs . the remaining project costs at december 31 , 2004 are estimated to be $ 7.0 million , consisting of $ 5.0 million for completion of the power line and $ 2.0 million for completion of miscellaneous items at the plant site . an additional $ 14 million is also budgeted in 2005 for purchase of additional mining equipment . during 2004 while testing and commissioning the mine we poured 5,292 ounces of gold resulting in $ 2.3 million of preproduction revenues which were credited against mine development costs . commissioning and testing of the new wassa processing plant began in late 2004. by december wassa had poured 5,292 ounces of gold resulting in $ 2.3 million of preproduction revenues which were credited against mine development costs . we expect wassa will achieve commercial production during the first quarter of 2005 , processing at its design capacity of approximately 10,000 tonnes per day . our 2005 mining plan involves processing most of the heap leach material left on the pads by the former owner which will furnish a low cost ore feed to the new plant during its first year of operations and will also clear the pad area for use as a tailings dam site . mining will be performed initially using a mixture of equipment transferred from bogoso/prestea and contract equipment until new equipment is procured . during

sg & a is an important financial metric that we analyze to help us evaluate the contribution of our selling , marketing and proposal activities to revenue generation . 54 other income and expenses other income and expenses includes interest income , interest expense , changes in fair value of certain financial investments , gains/losses on sale of available-for-sale equity securities and losses from equity method investments . income tax expense our effective tax rates are substantially lower than the statutory rates primarily due to research and development tax credits . critical accounting policies and estimates management 's discussion and analysis of financial condition and results of operations discusses our consolidated financial statements , which have been prepared in accordance with accounting principles generally accepted in the united states . when we prepare these consolidated financial statements , we are required to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period . some of our accounting policies require that we make subjective judgments , including estimates that involve matters that are inherently uncertain . our most critical estimates include those related to revenue recognition , inventories and reserves for excess and obsolescence , self-insured liabilities , accounting for stock-based awards , and income taxes . we base our estimates and judgments on historical experience and on various other factors that we believe to be reasonable under the circumstances , the results of which form the basis for our judgments about the carrying values of assets and liabilities that are not readily apparent from other sources . our actual results may differ from these estimates under different assumptions or conditions . we believe the following critical accounting estimates affect our more significant judgments and estimates used in preparing our consolidated financial statements . see note 1 of the notes to consolidated financial statements for our organization and significant accounting policies . there have been no material changes made to the critical accounting estimates during the periods presented in the consolidated financial statements . revenue recognition significant management judgments and estimates must be made and used in connection with the recognition of revenue in any accounting period . material differences in the amount of revenue in any given period may result if these judgments or estimates prove to be incorrect or if management 's estimates change on the basis of development of the business or market conditions . management judgments and estimates have been applied consistently and have been reliable historically . we believe that there are two key factors which impact the reliability of management 's estimates . the first of those key factors is that the terms of our contracts are typically less than six months . the short-term nature of such contracts reduces the risk that material changes in accounting estimates will occur on the basis of market conditions or other factors . the second key factor is that we have hundreds of contracts in any given accounting period , which reduces the risk that any one change in an accounting estimate on one or several contracts would have a material impact on our consolidated financial statements or our two reporting segments ' measures of profit . the substantial majority of our revenue is generated pursuant to written contractual arrangements to design , develop , manufacture and or modify complex products , and to provide related engineering , technical and other services according to customer specifications . these contracts may be fixed price or cost-reimbursable . we consider all contracts for treatment in accordance with authoritative guidance for contracts with multiple deliverables . 55 revenue from product sales not under contractual arrangement is recognized at the time title and the risk and rewards of ownership pass , which typically occurs when the products are shipped and collection is reasonably assured . revenue and profits on fixed-price contracts are recognized using percentage-of-completion methods of accounting . revenue and profits on fixed-price production contracts , whose units are produced and delivered in a continuous or sequential process , are recorded as units are delivered based on their selling prices , or the units-of-delivery method . revenue and profits on other fixed-price contracts with significant engineering as well as production requirements are recorded based on the ratio of total actual incurred costs to date to the total estimated costs for each contract , or the cost-to-cost method . under percentage-of-completion methods of accounting , a single estimated total profit margin is used to recognize profit for each contract over its entire period of performance , which can exceed one year . accounting for revenue and profits on a fixed-price contract requires the preparation of estimates of ( 1 ) the total contract revenue , ( 2 ) the total costs at completion , which is equal to the sum of the actual incurred costs to date on the contract and the estimated costs to complete the contract 's statement of work and ( 3 ) the measurement of progress towards completion . the estimated profit or loss at completion on a contract is equal to the difference between the total estimated contract revenue and the total estimated cost at completion . under the units-of-delivery method , sales on a fixed-price type contract are recorded as the units are delivered during the period based on their contractual selling prices . under the cost-to-cost method , sales on a fixed-price type contract are recorded at amounts equal to the ratio of actual cumulative costs incurred divided by total estimated costs at completion , multiplied by ( a ) the total estimated contract revenue , less ( b ) the cumulative sales recognized in prior periods . story_separator_special_tag uas gross margin increased $ 1.7 million , or 2 % , to $ 80.8 million for the fiscal year ended april 30 , 2014 , primarily due to an increase in sales volume . as a percentage of revenue , gross margin for uas decreased from 41 % to 39 % . ees gross margin decreased $ 0.7 million , or 5 % , to $ 12.8 million for the fiscal year ended april 30 , 2014. as a percentage of revenue , ees gross margin increased from 29 % to 30 % . selling , general and administrative . sg & a expense for the fiscal year ended april 30 , 2014 was $ 55.7 million , or 22 % of revenue , compared to sg & a expense of $ 51.5 million , or 21 % of revenue , for the fiscal year ended april 30 , 2013. sg & a expense increased by $ 4.2 million primarily due to impairment costs of tier-ii related assets and higher incentive compensation as a result of achieving certain measures of financial performance . research and development . r & d expense for the fiscal year ended april 30 , 2014 was $ 25.5 million , or 10 % of revenue , compared to r & d expense of $ 37.2 million , or 15 % of revenue , for the fiscal year ended april 30 , 2013. r & d expense decreased primarily due to decreased investments in various technology development initiatives . interest income . interest income for the fiscal year ended april 30 , 2014 was $ 0.9 million , as compared to $ 0.7 million for the fiscal year ended april 30 , 2013. other income . other income for the fiscal year ended april 30 , 2014 was $ 1.6 million , as compared to $ 6.2 million for the fiscal year ended april 30 , 2013. other income primarily represents the change in fair value of the conversion feature of our investment in convertible bonds . income tax expense . our effective income tax expense rate was 7.9 % for the fiscal year ended april 30 , 2014 , as compared to an effective income expense tax rate of 3.2 % for the fiscal year ended april 30 , 2013. the increase in the effective income tax expense rate was primarily due to higher taxable income and lower r & d tax credits . liquidity and capital resources we currently have no material cash commitments , except for normal recurring trade payables , accrued expenses and ongoing research and development costs , all of which we anticipate funding through our existing working capital and funds provided by operating activities . the majority of our purchase obligations are pursuant to funded contractual arrangements with our customers . in addition , we do not currently anticipate significant investment in property , plant and equipment , and we believe that our existing cash , cash equivalents , cash provided by operating activities and other financing sources will be sufficient to meet our anticipated working capital , capital expenditure and debt service requirements , if any , during the next twelve months . there can be no assurance , however , that our business will continue to generate cash flow at current levels . if we are unable to generate sufficient cash flow from operations , then we may be required to sell assets , reduce capital expenditures or obtain additional financing . we anticipate that existing sources of liquidity and cash flows from operations will be sufficient to satisfy our cash needs for the foreseeable future . our primary liquidity needs are for financing working capital , investing in capital expenditures , supporting product development efforts , introducing new products and enhancing existing products , and marketing acceptance and adoption of our products and services . our future capital requirements , to a certain extent , are also subject to general conditions in or affecting the defense and electric vehicle 61 industries and are subject to general economic , political , financial , competitive , legislative and regulatory factors that are beyond our control . moreover , to the extent that existing cash , cash equivalents , cash from operations , and cash from short-term borrowing are insufficient to fund our future activities , we may need to raise additional funds through public or private equity or debt financing . in addition , we may also need to seek additional equity funding or debt financing if we become a party to any agreement or letter of intent for potential investments in , or acquisitions of , businesses , services or technologies . our working capital requirements vary by contract type . on cost-plus-fee programs , we typically bill our incurred costs and fees monthly as work progresses , and therefore working capital investment is minimal . on fixed-price contracts , we typically are paid as we deliver products , and working capital is needed to fund labor and expenses incurred during the lead time from contract award until contract deliveries begin . story_separator_special_tag size= `` 2 `` > revenue from contracts with customers ( topic 606 ) . the new revenue recognition standard provides a five-step analysis of transactions to determine when and how revenue is recognized . the core principle is that a company should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services . this asu is effective for annual periods beginning after december 15 , 2017 and shall be applied either retrospectively to each period presented or as a cumulative-effect adjustment as of the date of adoption . we are evaluating the potential impact of this adoption on our consolidated financial statements . in june 2014 , the fasb issued asu no . 2014-12 , compensation—stock compensation (

cash flows the following table provides our cash flow data as of : replace_table_token_9_th cash provided by operating activities . net cash provided by operating activities for the fiscal year ended april 30 , 2015 increased by $ 5.4 million to $ 39.4 million , compared to net cash provided by operating activities of $ 34.0 million for the fiscal year ended april 30 , 2014. this increase in net cash provided by operating activities was primarily due to higher working capital generated of $ 16.1 million , a higher loss on disposal of fixed assets of $ 3.7 million and a change in fair value of the cybaero notes of $ 1.7 million , partially offset by lower net income of $ 10.8 million , lower impairment of long-lived assets of $ 2.9 million , lower tax benefits of $ 2.3 million and lower depreciation expense of $ 0.8 million . net cash provided by operating activities for the fiscal year ended april 30 , 2014 increased by $ 4.8 million to $ 34.0 million , compared to net cash provided by operating activities of $ 29.2 million for the fiscal year ended april 30 , 2013. this increase in net cash provided by operating activities was primarily due to the change in fair value of the cybaero notes of $ 4.4 million , impairment of tier-ii related assets of $ 3.3 million , higher net income of $ 3.3 million and higher working capital generated of $ 2.9 million , partially offset by higher deferred income taxes of $ 7.0 million and lower depreciation expense of $ 1.8 million . cash ( used in ) provided by investing activities .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```cash flows the following table provides our cash flow data as of : replace_table_token_9_th cash provided by operating activities . net cash provided by operating activities for the fiscal year ended april 30 , 2015 increased by $ 5.4 million to $ 39.4 million , compared to net cash provided by operating activities of $ 34.0 million for the fiscal year ended april 30 , 2014. this increase in net cash provided by operating activities was primarily due to higher working capital generated of $ 16.1 million , a higher loss on disposal of fixed assets of $ 3.7 million and a change in fair value of the cybaero notes of $ 1.7 million , partially offset by lower net income of $ 10.8 million , lower impairment of long-lived assets of $ 2.9 million , lower tax benefits of $ 2.3 million and lower depreciation expense of $ 0.8 million . net cash provided by operating activities for the fiscal year ended april 30 , 2014 increased by $ 4.8 million to $ 34.0 million , compared to net cash provided by operating activities of $ 29.2 million for the fiscal year ended april 30 , 2013. this increase in net cash provided by operating activities was primarily due to the change in fair value of the cybaero notes of $ 4.4 million , impairment of tier-ii related assets of $ 3.3 million , higher net income of $ 3.3 million and higher working capital generated of $ 2.9 million , partially offset by higher deferred income taxes of $ 7.0 million and lower depreciation expense of $ 1.8 million . cash ( used in ) provided by investing activities . ``` Suspicious Activity Report : sg & a is an important financial metric that we analyze to help us evaluate the contribution of our selling , marketing and proposal activities to revenue generation . 54 other income and expenses other income and expenses includes interest income , interest expense , changes in fair value of certain financial investments , gains/losses on sale of available-for-sale equity securities and losses from equity method investments . income tax expense our effective tax rates are substantially lower than the statutory rates primarily due to research and development tax credits . critical accounting policies and estimates management 's discussion and analysis of financial condition and results of operations discusses our consolidated financial statements , which have been prepared in accordance with accounting principles generally accepted in the united states . when we prepare these consolidated financial statements , we are required to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period . some of our accounting policies require that we make subjective judgments , including estimates that involve matters that are inherently uncertain . our most critical estimates include those related to revenue recognition , inventories and reserves for excess and obsolescence , self-insured liabilities , accounting for stock-based awards , and income taxes . we base our estimates and judgments on historical experience and on various other factors that we believe to be reasonable under the circumstances , the results of which form the basis for our judgments about the carrying values of assets and liabilities that are not readily apparent from other sources . our actual results may differ from these estimates under different assumptions or conditions . we believe the following critical accounting estimates affect our more significant judgments and estimates used in preparing our consolidated financial statements . see note 1 of the notes to consolidated financial statements for our organization and significant accounting policies . there have been no material changes made to the critical accounting estimates during the periods presented in the consolidated financial statements . revenue recognition significant management judgments and estimates must be made and used in connection with the recognition of revenue in any accounting period . material differences in the amount of revenue in any given period may result if these judgments or estimates prove to be incorrect or if management 's estimates change on the basis of development of the business or market conditions . management judgments and estimates have been applied consistently and have been reliable historically . we believe that there are two key factors which impact the reliability of management 's estimates . the first of those key factors is that the terms of our contracts are typically less than six months . the short-term nature of such contracts reduces the risk that material changes in accounting estimates will occur on the basis of market conditions or other factors . the second key factor is that we have hundreds of contracts in any given accounting period , which reduces the risk that any one change in an accounting estimate on one or several contracts would have a material impact on our consolidated financial statements or our two reporting segments ' measures of profit . the substantial majority of our revenue is generated pursuant to written contractual arrangements to design , develop , manufacture and or modify complex products , and to provide related engineering , technical and other services according to customer specifications . these contracts may be fixed price or cost-reimbursable . we consider all contracts for treatment in accordance with authoritative guidance for contracts with multiple deliverables . 55 revenue from product sales not under contractual arrangement is recognized at the time title and the risk and rewards of ownership pass , which typically occurs when the products are shipped and collection is reasonably assured . revenue and profits on fixed-price contracts are recognized using percentage-of-completion methods of accounting . revenue and profits on fixed-price production contracts , whose units are produced and delivered in a continuous or sequential process , are recorded as units are delivered based on their selling prices , or the units-of-delivery method . revenue and profits on other fixed-price contracts with significant engineering as well as production requirements are recorded based on the ratio of total actual incurred costs to date to the total estimated costs for each contract , or the cost-to-cost method . under percentage-of-completion methods of accounting , a single estimated total profit margin is used to recognize profit for each contract over its entire period of performance , which can exceed one year . accounting for revenue and profits on a fixed-price contract requires the preparation of estimates of ( 1 ) the total contract revenue , ( 2 ) the total costs at completion , which is equal to the sum of the actual incurred costs to date on the contract and the estimated costs to complete the contract 's statement of work and ( 3 ) the measurement of progress towards completion . the estimated profit or loss at completion on a contract is equal to the difference between the total estimated contract revenue and the total estimated cost at completion . under the units-of-delivery method , sales on a fixed-price type contract are recorded as the units are delivered during the period based on their contractual selling prices . under the cost-to-cost method , sales on a fixed-price type contract are recorded at amounts equal to the ratio of actual cumulative costs incurred divided by total estimated costs at completion , multiplied by ( a ) the total estimated contract revenue , less ( b ) the cumulative sales recognized in prior periods . story_separator_special_tag uas gross margin increased $ 1.7 million , or 2 % , to $ 80.8 million for the fiscal year ended april 30 , 2014 , primarily due to an increase in sales volume . as a percentage of revenue , gross margin for uas decreased from 41 % to 39 % . ees gross margin decreased $ 0.7 million , or 5 % , to $ 12.8 million for the fiscal year ended april 30 , 2014. as a percentage of revenue , ees gross margin increased from 29 % to 30 % . selling , general and administrative . sg & a expense for the fiscal year ended april 30 , 2014 was $ 55.7 million , or 22 % of revenue , compared to sg & a expense of $ 51.5 million , or 21 % of revenue , for the fiscal year ended april 30 , 2013. sg & a expense increased by $ 4.2 million primarily due to impairment costs of tier-ii related assets and higher incentive compensation as a result of achieving certain measures of financial performance . research and development . r & d expense for the fiscal year ended april 30 , 2014 was $ 25.5 million , or 10 % of revenue , compared to r & d expense of $ 37.2 million , or 15 % of revenue , for the fiscal year ended april 30 , 2013. r & d expense decreased primarily due to decreased investments in various technology development initiatives . interest income . interest income for the fiscal year ended april 30 , 2014 was $ 0.9 million , as compared to $ 0.7 million for the fiscal year ended april 30 , 2013. other income . other income for the fiscal year ended april 30 , 2014 was $ 1.6 million , as compared to $ 6.2 million for the fiscal year ended april 30 , 2013. other income primarily represents the change in fair value of the conversion feature of our investment in convertible bonds . income tax expense . our effective income tax expense rate was 7.9 % for the fiscal year ended april 30 , 2014 , as compared to an effective income expense tax rate of 3.2 % for the fiscal year ended april 30 , 2013. the increase in the effective income tax expense rate was primarily due to higher taxable income and lower r & d tax credits . liquidity and capital resources we currently have no material cash commitments , except for normal recurring trade payables , accrued expenses and ongoing research and development costs , all of which we anticipate funding through our existing working capital and funds provided by operating activities . the majority of our purchase obligations are pursuant to funded contractual arrangements with our customers . in addition , we do not currently anticipate significant investment in property , plant and equipment , and we believe that our existing cash , cash equivalents , cash provided by operating activities and other financing sources will be sufficient to meet our anticipated working capital , capital expenditure and debt service requirements , if any , during the next twelve months . there can be no assurance , however , that our business will continue to generate cash flow at current levels . if we are unable to generate sufficient cash flow from operations , then we may be required to sell assets , reduce capital expenditures or obtain additional financing . we anticipate that existing sources of liquidity and cash flows from operations will be sufficient to satisfy our cash needs for the foreseeable future . our primary liquidity needs are for financing working capital , investing in capital expenditures , supporting product development efforts , introducing new products and enhancing existing products , and marketing acceptance and adoption of our products and services . our future capital requirements , to a certain extent , are also subject to general conditions in or affecting the defense and electric vehicle 61 industries and are subject to general economic , political , financial , competitive , legislative and regulatory factors that are beyond our control . moreover , to the extent that existing cash , cash equivalents , cash from operations , and cash from short-term borrowing are insufficient to fund our future activities , we may need to raise additional funds through public or private equity or debt financing . in addition , we may also need to seek additional equity funding or debt financing if we become a party to any agreement or letter of intent for potential investments in , or acquisitions of , businesses , services or technologies . our working capital requirements vary by contract type . on cost-plus-fee programs , we typically bill our incurred costs and fees monthly as work progresses , and therefore working capital investment is minimal . on fixed-price contracts , we typically are paid as we deliver products , and working capital is needed to fund labor and expenses incurred during the lead time from contract award until contract deliveries begin . story_separator_special_tag size= `` 2 `` > revenue from contracts with customers ( topic 606 ) . the new revenue recognition standard provides a five-step analysis of transactions to determine when and how revenue is recognized . the core principle is that a company should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services . this asu is effective for annual periods beginning after december 15 , 2017 and shall be applied either retrospectively to each period presented or as a cumulative-effect adjustment as of the date of adoption . we are evaluating the potential impact of this adoption on our consolidated financial statements . in june 2014 , the fasb issued asu no . 2014-12 , compensation—stock compensation (

this may have a material adverse effect on our business , financial condition , results of operation , and cash flows . revenue effects related to covid-19 pandemic assay revenue beginning in march 2020 and continuing through the end of 2020 , the ongoing covid-19 pandemic has reduced patient access to clinician offices for in-person testing , which has resulted in a reduced volume of billable samples received relative to our pre-pandemic expectations . april 2020 billable sample volume was down by approximately 80 % , commensurate with the closure of dermatology offices , compared to the average monthly billable sample volume for the two months preceding the beginning of the covid-19 stay-at-home orders . despite the downturn in billable samples in april 2020 , we saw a stabilization of billable sample volume throughout the rest of the second quarter and through the fourth quarter as various states and dermatology offices opened throughout the country . billable sample volume first exceeded pre‑pandemic levels in july 2020 even without all dermatology practices returning to full operations . billable sample volume for the three months ended december 31 , 2020 was 24 % higher than billable sample volume for the three months ended september 30 , 2020 , and billable sample volume for the twelve months ended december 31 , 2020 was 75 % higher than billable sample volume for the twelve months ended december 31 , 2019. billable sample volume for the three months ended december 31 , 2020 was 69 % higher than billable sample volume for the three months ended december 31 , 2019. billable sample volumes could continue to be impacted by the ongoing covid-19 pandemic and further impacted by a resurgence of the virus in the future . 58 we have made available beginning in late april 2020 a telemedicine option for the pla , but the telemedicine market is r elatively new and unproven , especially within dermatology , and it is uncertain whether it will achieve and sustain high levels of demand , consumer acceptance and market adoption . while the covid-19 pandemic is ongoing and clinician offices could close agai n due to the rolling back of reopening plans in various states , or patients could worry about going into the dermatology clinic , we expect that our revenues will depend to an extent on the willingness of clinicians and their patients to use our telemedicin e option for the pla , as well as on our ability to demonstrate the value of our telemedicine option to health plans and other purchasers of healthcare for beneficiaries . we also expect that the duration and extent of the effects of the ongoing covid-19 pan demic in reducing patient access to clinician offices for in-person testing , and access by our sales force for in-office sales calls will adversely affect our revenues . contract revenue contract revenues with major pharmaceutical companies relate to ongoing clinical trial contracts and new contracts . contract revenue can be highly variable as it is dependent on the pharmaceutical customers ' clinical trial progress which can be difficult to forecast due to variability of patient enrollment , drug safety and efficacy and other factors . many of our contracts with third parties are structured to contain milestone billing payments , which typically are advance payments on work yet to be performed . these advanced payments are structured to help fund operations and are included in deferred revenue as the work has not yet been performed . these advance payments will remain in deferred revenue until we process the laboratory portion of the contracts allowing us to recognize the revenue . the ongoing covid-19 pandemic has negatively affected and will continue to negatively affect our pharmaceutical customers ' clinical trials . the extent of such effect on our future revenue is uncertain and will depend on the duration and extent of the effects of the ongoing covid-19 pandemic on our pharmaceutical customers ' clinical trials . financial overview revenue we generate revenue through laboratory services that are billed to medicare , private medical insurance companies and to pharmaceutical companies who order our laboratory services , which can include sample collection kits , assay development , genomic analysis , data analysis and reporting . our revenue is generated from two revenue streams : contract revenue and assay revenue . assay revenue can be highly variable as it is based on payments received by private insurance payors that are not under contract and can vary based on patient insurance coverage , deductibles and co-pays . contract revenue is ordered by customers on projects that may span over several years , which makes this type of revenue highly variable . segments of these contracts may be increased , delayed or eliminated based on the success of each customers ' clinical trials or other factors . operating expenses sales and marketing expenses sales and marketing expenses are primarily related to our specialty field sales force , market research , reimbursement efforts , trade show attendance , public relations , and general marketing . we expect these expenses to increase significantly as we expand our direct consumer marketing efforts and continue to add to our specialty sales force , marketing and payor access teams throughout 2021. research and development expenses our research and development , or r & d , expenses consist primarily of salaries and fringe benefits , clinical trials , consulting costs , facilities costs , laboratory costs , equipment expense , and depreciation . we also conduct clinical trials to validate the performance characteristics of our tests and to show medical cost benefit in support of our reimbursement efforts . we expect these expenses to increase significantly as we continue to develop new products and expand the use of our existing products . story_separator_special_tag because of the numerous risks and uncertainties associated with our commercialization and development efforts , we are unable to predict when we will become profitable , and we may never become profitable . our inability to achieve and then maintain profitability would negatively affect our business , financial condition , results of operations and cash flows . as of december 31 , 2020 , our cash , cash equivalents and marketable securities totaled $ 63.8 million . on january 11 , 2021 , we closed a public offering that resulted in aggregate gross proceeds of $ 143.7 million from the offering , before deducting underwriting discounts and commissions and other offering expenses . based on our current business operations and the additional 2021 financing , we believe our current cash and cash equivalents will be sufficient to meet our anticipated cash requirements for at least the next twelve months . while we believe we have enough capital to fund anticipated operating costs for at least the next 12 months , we expect to incur significant additional operating losses over at least the next several years . we anticipate that we will raise additional capital through equity offerings , debt financings , collaborations or licensing arrangements in order to support our planned operations and to continue developing and commercializing genomic tests . we may also consider raising additional capital in the future to expand our business , to pursue strategic investments or to take advantage of financing opportunities . our present and future funding requirements will depend on many factors , including : our revenue growth rate and ability to generate cash flows from operating activities ; the willingness of clinicians and their patients to use our telemedicine option for the pla and the duration and extent of the effects of the ongoing covid-19 pandemic in reducing patient access to clinician offices for in-person testing ; the duration and extent of the effects of the ongoing covid-19 pandemic on our pharmaceutical customers ' clinical trials ; our sales and marketing and r & d activities ; effects of competing technological and market developments ; costs of and potential delays in product development ; changes in regulatory oversight applicable to our tests ; and timing of and costs related to future international expansion . there can be no assurances as to the availability of additional financing or the terms upon which additional financing may be available to us . if we are unable to obtain sufficient funding at acceptable terms , we may be forced to significantly curtail our operations , and the lack of sufficient funding may have a material adverse impact on our ability to continue as a going concern . story_separator_special_tag assay development for research partners , rna extraction , isolation , expression , amplification and detection , including data analysis and reporting . see note 1 ( k ) of our consolidated financial statements for a full discussion of our revenue recognition policy around assay revenue and contract revenue . stock-based compensation compensation costs associated with stock option awards and other forms of equity compensation are measured at the grant-date fair value of the awards and recognized over the requisite service period of the awards on a ratable basis . we grant stock options to purchase common stock to employees with exercise prices equal to the fair market value of the underlying stock , as determined by the board of directors , management , outside valuation experts and subsequent to the completion of the business combination , the closing stock price on the date of grant . the board of directors and outside valuation experts determine the fair value of the underlying stock by considering a number of factors , including historical and projected financial results , the risks we faced at the time , the preferences of our debt holders and preferred stockholders , and the lack of liquidity of our common stock that occurred prior to the business combination . the fair value of each stock option award is estimated using the black-scholes-merton valuation model . such value is recognized as expense over the requisite service period using the straight-line method . the expected term of options is based on the simplified method which defines the expected term as the average of the contractual term of the options and the weighted average vesting period for all option tranches . the expected volatility of stock options is based upon the historical volatility of a number of related publicly traded companies in similar stages of development as well as the volatility of the company 's common stock . the risk-free interest rate is based on the average yield of u.s. treasury securities with remaining terms similar to the expected term of the share-based awards . the assumed dividend yield was based on our expectation of not paying dividends in the foreseeable future . we account for stock options to non-employees using the fair value approach . the fair value of these options is measured using the black-scholes-merton optio n pricing model , reflecting the same assumptions applied to employee options , other than expected life , which is assumed to be the remaining contractual life of the award . options that are granted to employees generally have a requisite service period of three to four years . 65 restricted stock units ( “ rsus ” ) are considered restricted stock . the fair value of restricted stock is equal to the fair market value of the underlying stock , as determined by the board of directors , management , input from outside valua tion experts and subsequent to the completion of the business combination , the closing stock price on the date of grant . we recognize stock-based compensation expense based on the fair value on a ratable basis over the requisite service periods of the awar ds . rsus that are granted to employees have a requisite service period typically between two and four years . recent

cash flow analysis fiscal year ended december 31 , 2020 net cash used in operating activities for the twelve months ended december 31 , 2020 totaled $ 28.7 million , primarily driven by the $ 35.2 million net loss offset by non-cash related items , including $ 5.0 million in stock-based compensation and $ 0.5 million in depreciation . in addition , we had a cash inflow of $ 0.8 million through the increase of accounts payable and accrued compensation as well as a $ 1.6 million of cash inflow through the increase of accrued liabilities and deferred revenues . this was offset by the cash outflow through the increase of prepaid expenses and other assets of $ 0.5 million as well as an increase in accounts receivable of $ 0.8 million . 63 net cash used in investing activities totaled $ 41.3 million for the twelve months ended december 31 , 2020 , primarily related to the purchas e of $ 41 . 7 million in short-term marketable securities and $ 1 . 8 million in purchases of property and equipment . this was offset by cash inflows from the sale and maturity of marketable securities of $ 2.2 million . as we scale our sales force , the expected t iming of a corresponding increase in assay volume is uncertain due , in part , to challenges presented by the ongoing covid-19 pandemic , such as related limits on patient access to clinician offices for in-person testing . additional laboratory equipment inve stment will be needed to install complex automation systems and other genomic testing equipment needed to expand testing capacit y . net cash provided by financing activities totaled $ 78.9 million for the twelve months ended december 31 , 2020 , which was predominantly driven by the $ 59.9 million and $ 19.1 million in net proceeds raised from the 2020 pipe financing and at-the-market offering , respectively , and $ 1.3 million from the exercise of stock options and warrants . this was offset by the payment made by the company of the deferred underwriting fees of $ 1.4 million .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```cash flow analysis fiscal year ended december 31 , 2020 net cash used in operating activities for the twelve months ended december 31 , 2020 totaled $ 28.7 million , primarily driven by the $ 35.2 million net loss offset by non-cash related items , including $ 5.0 million in stock-based compensation and $ 0.5 million in depreciation . in addition , we had a cash inflow of $ 0.8 million through the increase of accounts payable and accrued compensation as well as a $ 1.6 million of cash inflow through the increase of accrued liabilities and deferred revenues . this was offset by the cash outflow through the increase of prepaid expenses and other assets of $ 0.5 million as well as an increase in accounts receivable of $ 0.8 million . 63 net cash used in investing activities totaled $ 41.3 million for the twelve months ended december 31 , 2020 , primarily related to the purchas e of $ 41 . 7 million in short-term marketable securities and $ 1 . 8 million in purchases of property and equipment . this was offset by cash inflows from the sale and maturity of marketable securities of $ 2.2 million . as we scale our sales force , the expected t iming of a corresponding increase in assay volume is uncertain due , in part , to challenges presented by the ongoing covid-19 pandemic , such as related limits on patient access to clinician offices for in-person testing . additional laboratory equipment inve stment will be needed to install complex automation systems and other genomic testing equipment needed to expand testing capacit y . net cash provided by financing activities totaled $ 78.9 million for the twelve months ended december 31 , 2020 , which was predominantly driven by the $ 59.9 million and $ 19.1 million in net proceeds raised from the 2020 pipe financing and at-the-market offering , respectively , and $ 1.3 million from the exercise of stock options and warrants . this was offset by the payment made by the company of the deferred underwriting fees of $ 1.4 million . ``` Suspicious Activity Report : this may have a material adverse effect on our business , financial condition , results of operation , and cash flows . revenue effects related to covid-19 pandemic assay revenue beginning in march 2020 and continuing through the end of 2020 , the ongoing covid-19 pandemic has reduced patient access to clinician offices for in-person testing , which has resulted in a reduced volume of billable samples received relative to our pre-pandemic expectations . april 2020 billable sample volume was down by approximately 80 % , commensurate with the closure of dermatology offices , compared to the average monthly billable sample volume for the two months preceding the beginning of the covid-19 stay-at-home orders . despite the downturn in billable samples in april 2020 , we saw a stabilization of billable sample volume throughout the rest of the second quarter and through the fourth quarter as various states and dermatology offices opened throughout the country . billable sample volume first exceeded pre‑pandemic levels in july 2020 even without all dermatology practices returning to full operations . billable sample volume for the three months ended december 31 , 2020 was 24 % higher than billable sample volume for the three months ended september 30 , 2020 , and billable sample volume for the twelve months ended december 31 , 2020 was 75 % higher than billable sample volume for the twelve months ended december 31 , 2019. billable sample volume for the three months ended december 31 , 2020 was 69 % higher than billable sample volume for the three months ended december 31 , 2019. billable sample volumes could continue to be impacted by the ongoing covid-19 pandemic and further impacted by a resurgence of the virus in the future . 58 we have made available beginning in late april 2020 a telemedicine option for the pla , but the telemedicine market is r elatively new and unproven , especially within dermatology , and it is uncertain whether it will achieve and sustain high levels of demand , consumer acceptance and market adoption . while the covid-19 pandemic is ongoing and clinician offices could close agai n due to the rolling back of reopening plans in various states , or patients could worry about going into the dermatology clinic , we expect that our revenues will depend to an extent on the willingness of clinicians and their patients to use our telemedicin e option for the pla , as well as on our ability to demonstrate the value of our telemedicine option to health plans and other purchasers of healthcare for beneficiaries . we also expect that the duration and extent of the effects of the ongoing covid-19 pan demic in reducing patient access to clinician offices for in-person testing , and access by our sales force for in-office sales calls will adversely affect our revenues . contract revenue contract revenues with major pharmaceutical companies relate to ongoing clinical trial contracts and new contracts . contract revenue can be highly variable as it is dependent on the pharmaceutical customers ' clinical trial progress which can be difficult to forecast due to variability of patient enrollment , drug safety and efficacy and other factors . many of our contracts with third parties are structured to contain milestone billing payments , which typically are advance payments on work yet to be performed . these advanced payments are structured to help fund operations and are included in deferred revenue as the work has not yet been performed . these advance payments will remain in deferred revenue until we process the laboratory portion of the contracts allowing us to recognize the revenue . the ongoing covid-19 pandemic has negatively affected and will continue to negatively affect our pharmaceutical customers ' clinical trials . the extent of such effect on our future revenue is uncertain and will depend on the duration and extent of the effects of the ongoing covid-19 pandemic on our pharmaceutical customers ' clinical trials . financial overview revenue we generate revenue through laboratory services that are billed to medicare , private medical insurance companies and to pharmaceutical companies who order our laboratory services , which can include sample collection kits , assay development , genomic analysis , data analysis and reporting . our revenue is generated from two revenue streams : contract revenue and assay revenue . assay revenue can be highly variable as it is based on payments received by private insurance payors that are not under contract and can vary based on patient insurance coverage , deductibles and co-pays . contract revenue is ordered by customers on projects that may span over several years , which makes this type of revenue highly variable . segments of these contracts may be increased , delayed or eliminated based on the success of each customers ' clinical trials or other factors . operating expenses sales and marketing expenses sales and marketing expenses are primarily related to our specialty field sales force , market research , reimbursement efforts , trade show attendance , public relations , and general marketing . we expect these expenses to increase significantly as we expand our direct consumer marketing efforts and continue to add to our specialty sales force , marketing and payor access teams throughout 2021. research and development expenses our research and development , or r & d , expenses consist primarily of salaries and fringe benefits , clinical trials , consulting costs , facilities costs , laboratory costs , equipment expense , and depreciation . we also conduct clinical trials to validate the performance characteristics of our tests and to show medical cost benefit in support of our reimbursement efforts . we expect these expenses to increase significantly as we continue to develop new products and expand the use of our existing products . story_separator_special_tag because of the numerous risks and uncertainties associated with our commercialization and development efforts , we are unable to predict when we will become profitable , and we may never become profitable . our inability to achieve and then maintain profitability would negatively affect our business , financial condition , results of operations and cash flows . as of december 31 , 2020 , our cash , cash equivalents and marketable securities totaled $ 63.8 million . on january 11 , 2021 , we closed a public offering that resulted in aggregate gross proceeds of $ 143.7 million from the offering , before deducting underwriting discounts and commissions and other offering expenses . based on our current business operations and the additional 2021 financing , we believe our current cash and cash equivalents will be sufficient to meet our anticipated cash requirements for at least the next twelve months . while we believe we have enough capital to fund anticipated operating costs for at least the next 12 months , we expect to incur significant additional operating losses over at least the next several years . we anticipate that we will raise additional capital through equity offerings , debt financings , collaborations or licensing arrangements in order to support our planned operations and to continue developing and commercializing genomic tests . we may also consider raising additional capital in the future to expand our business , to pursue strategic investments or to take advantage of financing opportunities . our present and future funding requirements will depend on many factors , including : our revenue growth rate and ability to generate cash flows from operating activities ; the willingness of clinicians and their patients to use our telemedicine option for the pla and the duration and extent of the effects of the ongoing covid-19 pandemic in reducing patient access to clinician offices for in-person testing ; the duration and extent of the effects of the ongoing covid-19 pandemic on our pharmaceutical customers ' clinical trials ; our sales and marketing and r & d activities ; effects of competing technological and market developments ; costs of and potential delays in product development ; changes in regulatory oversight applicable to our tests ; and timing of and costs related to future international expansion . there can be no assurances as to the availability of additional financing or the terms upon which additional financing may be available to us . if we are unable to obtain sufficient funding at acceptable terms , we may be forced to significantly curtail our operations , and the lack of sufficient funding may have a material adverse impact on our ability to continue as a going concern . story_separator_special_tag assay development for research partners , rna extraction , isolation , expression , amplification and detection , including data analysis and reporting . see note 1 ( k ) of our consolidated financial statements for a full discussion of our revenue recognition policy around assay revenue and contract revenue . stock-based compensation compensation costs associated with stock option awards and other forms of equity compensation are measured at the grant-date fair value of the awards and recognized over the requisite service period of the awards on a ratable basis . we grant stock options to purchase common stock to employees with exercise prices equal to the fair market value of the underlying stock , as determined by the board of directors , management , outside valuation experts and subsequent to the completion of the business combination , the closing stock price on the date of grant . the board of directors and outside valuation experts determine the fair value of the underlying stock by considering a number of factors , including historical and projected financial results , the risks we faced at the time , the preferences of our debt holders and preferred stockholders , and the lack of liquidity of our common stock that occurred prior to the business combination . the fair value of each stock option award is estimated using the black-scholes-merton valuation model . such value is recognized as expense over the requisite service period using the straight-line method . the expected term of options is based on the simplified method which defines the expected term as the average of the contractual term of the options and the weighted average vesting period for all option tranches . the expected volatility of stock options is based upon the historical volatility of a number of related publicly traded companies in similar stages of development as well as the volatility of the company 's common stock . the risk-free interest rate is based on the average yield of u.s. treasury securities with remaining terms similar to the expected term of the share-based awards . the assumed dividend yield was based on our expectation of not paying dividends in the foreseeable future . we account for stock options to non-employees using the fair value approach . the fair value of these options is measured using the black-scholes-merton optio n pricing model , reflecting the same assumptions applied to employee options , other than expected life , which is assumed to be the remaining contractual life of the award . options that are granted to employees generally have a requisite service period of three to four years . 65 restricted stock units ( “ rsus ” ) are considered restricted stock . the fair value of restricted stock is equal to the fair market value of the underlying stock , as determined by the board of directors , management , input from outside valua tion experts and subsequent to the completion of the business combination , the closing stock price on the date of grant . we recognize stock-based compensation expense based on the fair value on a ratable basis over the requisite service periods of the awar ds . rsus that are granted to employees have a requisite service period typically between two and four years . recent

in addition to those directly involved in practicing our codeevolver ® protein engineering platform technology , such as molecular biology , enzymology , microbiology , cellular engineering , metabolic engineering , bioinformatics , biochemistry and high throughput analytical chemistry , our process development projects also involve integrated expertise in organic chemistry , chemical process development , chemical engineering , fermentation process development and fermentation engineering . our integrated , multi-disciplinary approach to biocatalyst and process development is a critical success factor for our company . we initially commercialized our codeevolver ® protein engineering technology platform and products in the pharmaceuticals market , which remains our primary business focus . our customers , which include several large global pharmaceutical companies , use our technology , products and services in their manufacturing processes and process development . we have also used the technology to develop protein catalysts for use in the fine chemicals market . the fine chemicals market consists of several large market verticals , including food and food ingredients , animal feed , flavors , fragrances and agricultural chemicals . we have also begun using the codeevolver ® protein engineering technology platform to develop early stage , novel biotherapeutic product candidates , both for our customers and for our own business , most notably our lead program for the 54 potential treatment of phenylketonuria ( `` pku `` ) in humans . pku is an inherited metabolic disorder in which the enzyme that converts the essential amino acid phenylalanine into tyrosine is deficient . in october 2017 , we entered into a global development , option and license agreement ( the `` nestlé agreement `` ) with nestec ltd. ( `` nestlé health science `` ) , to advance cdx-6114 , our enzyme biotherapeutic product candidate for the potential treatment of pku . in february 2019 , nestlé health science exercised its option to obtain an exclusive license to develop and commercialize cdx-6114 . see note 16 , “ subsequent events ” in the notes to the consolidated financial statements set forth in item 8 of this annual report on form 10-k for details . in april 2018 , we entered into a strategic agreement ( the `` porton agreement `` ) with porton pharma solutions , ltd. ( `` porton `` ) to license key elements of our platform technology to porton 's global custom intermediate and active pharmaceutical ingredients ( `` api `` ) development and manufacturing business . this gives us access to a wide variety of small and medium-sized pharmaceutical customers . we are also using our technology to develop enzymes for customers using next generation sequencing ( `` ngs `` ) and polymerase chain reaction ( `` pcr/qpcr `` ) for in vitro molecular diagnostic and genomic research applications . our first enzyme is a ligase which we began marketing to customers in 2018. business segments we manage our business as two business segments : performance enzymes and novel biotherapeutics . see note 15 , `` segment , geographical and other revenue information `` in the notes to the consolidated financial statements set forth in item 8 of this annual report on form 10-k. performance enzymes we initially commercialized our codeevolver ® protein engineering technology platform and products in the pharmaceuticals market , and to date this continues to be our largest market served . our customers , which include many large global pharmaceutical companies , use our technology , products and services in their manufacturing processes and process development . we have also used the technology to develop customized enzymes for use in other industrial markets . these markets consist of several large industrial verticals , including food and food ingredients , animal feed , flavors , fragrances , and agricultural chemicals . we also use our technology to develop enzymes for customers using ngs and pcr/qpcr for in vitro molecular diagnostic and molecular biology research applications . in april 2018 , we entered into the porton agreement related to our strategic collaboration with porton to license key elements of our world-leading biocatalyst technology for use in porton 's global custom intermediate and api development and manufacturing business . novel biotherapeutics we are also targeting new opportunities in the pharmaceutical industry to discover , improve , and or develop biotherapeutic drug candidates . we believe that our codeevolver ® protein engineering platform technology can be used to discover novel biotherapeutic drug candidates that will target human diseases that are in need of improved therapeutic interventions . similarly , we believe that we can deploy our platform technology to improve specific characteristics of a customer 's pre-existing biotherapeutic drug candidate , such as its activity , stability or immunogenicity . most notable is our lead program for the potential treatment of hyperphenylalaninemia ( “ hpa ” ) ( also referred to as pku ) in humans . pku is an inherited metabolic disorder in which the enzyme that converts the essential amino acid phenylalanine into tyrosine is deficient . in october 2017 , we announced a strategic collaboration with nestlé health science to advance cdx-6114 , our own novel orally administrable enzyme therapeutic candidate for the potential treatment of pku . in july 2018 , we announced that we had dosed the first subjects in a first-in-human phase 1a dose-escalation trial with cdx-6114 , which was conducted in australia . in november 2018 , we announced top-line results from the phase 1a study in healthy volunteers with cdx-6114 . in december 2018 , nestlé health science became obligated to pay us an additional $ 1.0 million within 60 days after the achievement of a milestone relating to formulation of cdx-6114 . story_separator_special_tag under the strategic collaboration agreement , we received an 58 upfront payment of $ 1.2 million in 2017 and an incremental $ 0.6 million payment in september 2018 for additional services . we recognized research and development fees of $ 3.6 million and $ 0.5 million in 2018 and 2017 , respectively . as of december 31 , 2018 and 2017 , we had deferred revenue of $ 0.8 million and $ 1.1 million , respectively . strategic collaboration agreement in april 2018 , we entered into the porton agreement with porton to license key elements of codexis ' biocatalyst technology for use in porton 's global custom intermediate and api development and manufacturing business . under the porton agreement , we are eligible to receive annual collaboration fees and research and development revenues . we received an initial collaboration fee of $ 0.5 million within 30 days of the effective date of the agreement . as of december 31 , 2018 , we completed the technical transfer and we recognized revenue of $ 2.8 million in 2018 as research and development revenue . revenue relating to the functional license provided to porton was recognized at a point in time when control of the license transferred and technology transfer to the customer . we have the potential to receive performance payments based on products produced by porton using our company 's technology under the license agreement . recent accounting pronouncements for information on recent accounting pronouncements , see note 2 , “ summary of significant accounting policies ” , to the consolidated financial statements set forth in item 8 of this annual report on form 10-k. financial results for the year ended december 31 , 2018 , as compared to the year ended december 31 , 2017 , reflect the effects of adopting asu 2014-09 , “ revenue from contracts with customers ( topic 606 ) , ” and the related amendments ( “ asc 606 ” ) , which provided a new basis of accounting for our revenue arrangements during fiscal 2018. the adoption of asc 606 limits the comparability of revenue and certain expenses , including revenues and costs and operating expenses , presented in the results of operations for the year ended december 31 , 2018 when compared to the year ended december 31 , 2017. for additional information regarding the impact from adoption of this accounting standard , see note 3 , “ revenue recognition ” to the consolidated financial statements set forth in item 8 of this annual report on form 10-k. results of operations the following table shows the amounts from our consolidated statements of operations for the periods presented ( in thousands , except percentages ) : replace_table_token_4_th 59 revenues our revenues are comprised of product revenue and research and development revenue as follows : product revenue consist of sales of protein catalysts , pharmaceutical intermediates , and codex ® biocatalyst panels and kits . research and development revenue include license , technology access and exclusivity fees , research services fees , milestone payments , royalties , optimization and screening fees , and revenue sharing arrangement based upon sales of licensed products by our former revenue sharing partner , exela pharmsci , inc. ( “ exela ” ) in 2017 and 2016. revenues is as follows ( in thousands , except percentages ) : replace_table_token_5_th revenues typically fluctuate on a quarterly basis due to the variability in our customers ' manufacturing schedules and the timing of our customers ' clinical trials . in addition , we have limited internal capacity to manufacture enzymes . as a result , we are dependent upon the performance and capacity of third party manufacturers for the commercial scale manufacturing of the enzymes used in our pharmaceutical and fine chemicals business . we accept purchase orders for deliveries covering periods from one day up to approximately one year from the date on which the order is placed . however , a majority of the purchase orders can be revised or cancelled by the customer without penalty . considering these industry practices and our experience , we do not believe the total of customer purchase orders outstanding ( backlog ) provides meaningful information that can be relied on to predict actual sales for future periods . 2018 compared to 2017 total revenues increased by $ 10.6 million in 2018 to $ 60.6 million , as compared to 2017 . the increase was driven by growth in research and development revenue of $ 11.7 million or 50 % , partially offset by a decrease of $ 1.1 million in product revenue . product revenue , which consist primarily of sales of protein catalysts , pharmaceutical intermediates , and codex ® biocatalyst panels and kits , were $ 25.6 million in 2018 , a decrease of 4 % compared with $ 26.7 million in 2017 . the decrease was primarily due to variability in our customers ' manufacturing schedules . research and development revenue increased by $ 11.7 million in 2018 to $ 35.0 million , as compared to 2017 , primarily due to revenues from our arrangements with nestlé health science for the development of cdx-6114 and development of novel enzymes for nestlé health science under our strategic collaboration agreement , research and development revenue from tate & lyle , merck and novartis , and on the recognition of a functional license fee and technology transfer from porton . 2017 compared to 2016 total revenues increased by $ 1.2 million in 2017 to $ 50.0 million , as compared to 2016. the increase was driven by an increase in product revenue of $ 11.4 million or 74 % , offset by a decrease of $ 10.2 million in research and development revenue . product revenue , which consist primarily of sales of protein catalysts , pharmaceutical intermediates , and codex ® biocatalyst panels and kits , were $ 26.7 million in 2017 , an increase of 74 % compared with

cash used in operating activities was $ 1.9 million in 2016 , which resulted from a net loss of $ 8.6 million adjusted for non-cash depreciation and amortization of $ 4.5 million and stock-based compensation of $ 5.7 million , as well as changes in operating assets and liabilities . the net change in operating assets and liabilities included decreases in deferred revenue of $ 6.4 million primarily related to revenue recognition on the achievement of milestones from collaborative arrangements with merck and gsk , partially offset by a decrease in accounts receivable of $ 1.4 million , and increases in accrued compensation of $ 1.0 million primarily due to higher payroll costs and higher accounts payable of $ 0.9 million due to the timing of payment of invoices . cash flows from investing activities cash used in investing activities was $ 2.8 million in 2018 primarily due to the purchase of property and equipment . we expect our capital spending including replacement and upgrades of lab equipment and information technology equipment will be higher in 2019 as compared to 2018. cash used in investing activities was $ 1.0 million in 2017 , primarily due to the purchase of property and equipment . 67 cash used investing activities was $ 0.8 million in 2016 , primarily due to the purchase of property and equipment . cash flows from financing activities cash provided by financing activities was $ 38.6 million in 2018 , primarily due to net proceeds from our offering of common stock after deducting underwriting discounts and commission and related costs and proceeds from the exercises of employee stock options which were partially offset by the payment of taxes related to the net share settlement of equity awards . cash provided by financing activities was $ 21.7 million in 2017 , primarily due to net proceeds from our offering of common stock after deducting underwriting discounts and commission and related costs and proceeds from the exercises of employee stock options which were partially offset by the payment of taxes related to the net share settlement of equity awards .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```cash used in operating activities was $ 1.9 million in 2016 , which resulted from a net loss of $ 8.6 million adjusted for non-cash depreciation and amortization of $ 4.5 million and stock-based compensation of $ 5.7 million , as well as changes in operating assets and liabilities . the net change in operating assets and liabilities included decreases in deferred revenue of $ 6.4 million primarily related to revenue recognition on the achievement of milestones from collaborative arrangements with merck and gsk , partially offset by a decrease in accounts receivable of $ 1.4 million , and increases in accrued compensation of $ 1.0 million primarily due to higher payroll costs and higher accounts payable of $ 0.9 million due to the timing of payment of invoices . cash flows from investing activities cash used in investing activities was $ 2.8 million in 2018 primarily due to the purchase of property and equipment . we expect our capital spending including replacement and upgrades of lab equipment and information technology equipment will be higher in 2019 as compared to 2018. cash used in investing activities was $ 1.0 million in 2017 , primarily due to the purchase of property and equipment . 67 cash used investing activities was $ 0.8 million in 2016 , primarily due to the purchase of property and equipment . cash flows from financing activities cash provided by financing activities was $ 38.6 million in 2018 , primarily due to net proceeds from our offering of common stock after deducting underwriting discounts and commission and related costs and proceeds from the exercises of employee stock options which were partially offset by the payment of taxes related to the net share settlement of equity awards . cash provided by financing activities was $ 21.7 million in 2017 , primarily due to net proceeds from our offering of common stock after deducting underwriting discounts and commission and related costs and proceeds from the exercises of employee stock options which were partially offset by the payment of taxes related to the net share settlement of equity awards . ``` Suspicious Activity Report : in addition to those directly involved in practicing our codeevolver ® protein engineering platform technology , such as molecular biology , enzymology , microbiology , cellular engineering , metabolic engineering , bioinformatics , biochemistry and high throughput analytical chemistry , our process development projects also involve integrated expertise in organic chemistry , chemical process development , chemical engineering , fermentation process development and fermentation engineering . our integrated , multi-disciplinary approach to biocatalyst and process development is a critical success factor for our company . we initially commercialized our codeevolver ® protein engineering technology platform and products in the pharmaceuticals market , which remains our primary business focus . our customers , which include several large global pharmaceutical companies , use our technology , products and services in their manufacturing processes and process development . we have also used the technology to develop protein catalysts for use in the fine chemicals market . the fine chemicals market consists of several large market verticals , including food and food ingredients , animal feed , flavors , fragrances and agricultural chemicals . we have also begun using the codeevolver ® protein engineering technology platform to develop early stage , novel biotherapeutic product candidates , both for our customers and for our own business , most notably our lead program for the 54 potential treatment of phenylketonuria ( `` pku `` ) in humans . pku is an inherited metabolic disorder in which the enzyme that converts the essential amino acid phenylalanine into tyrosine is deficient . in october 2017 , we entered into a global development , option and license agreement ( the `` nestlé agreement `` ) with nestec ltd. ( `` nestlé health science `` ) , to advance cdx-6114 , our enzyme biotherapeutic product candidate for the potential treatment of pku . in february 2019 , nestlé health science exercised its option to obtain an exclusive license to develop and commercialize cdx-6114 . see note 16 , “ subsequent events ” in the notes to the consolidated financial statements set forth in item 8 of this annual report on form 10-k for details . in april 2018 , we entered into a strategic agreement ( the `` porton agreement `` ) with porton pharma solutions , ltd. ( `` porton `` ) to license key elements of our platform technology to porton 's global custom intermediate and active pharmaceutical ingredients ( `` api `` ) development and manufacturing business . this gives us access to a wide variety of small and medium-sized pharmaceutical customers . we are also using our technology to develop enzymes for customers using next generation sequencing ( `` ngs `` ) and polymerase chain reaction ( `` pcr/qpcr `` ) for in vitro molecular diagnostic and genomic research applications . our first enzyme is a ligase which we began marketing to customers in 2018. business segments we manage our business as two business segments : performance enzymes and novel biotherapeutics . see note 15 , `` segment , geographical and other revenue information `` in the notes to the consolidated financial statements set forth in item 8 of this annual report on form 10-k. performance enzymes we initially commercialized our codeevolver ® protein engineering technology platform and products in the pharmaceuticals market , and to date this continues to be our largest market served . our customers , which include many large global pharmaceutical companies , use our technology , products and services in their manufacturing processes and process development . we have also used the technology to develop customized enzymes for use in other industrial markets . these markets consist of several large industrial verticals , including food and food ingredients , animal feed , flavors , fragrances , and agricultural chemicals . we also use our technology to develop enzymes for customers using ngs and pcr/qpcr for in vitro molecular diagnostic and molecular biology research applications . in april 2018 , we entered into the porton agreement related to our strategic collaboration with porton to license key elements of our world-leading biocatalyst technology for use in porton 's global custom intermediate and api development and manufacturing business . novel biotherapeutics we are also targeting new opportunities in the pharmaceutical industry to discover , improve , and or develop biotherapeutic drug candidates . we believe that our codeevolver ® protein engineering platform technology can be used to discover novel biotherapeutic drug candidates that will target human diseases that are in need of improved therapeutic interventions . similarly , we believe that we can deploy our platform technology to improve specific characteristics of a customer 's pre-existing biotherapeutic drug candidate , such as its activity , stability or immunogenicity . most notable is our lead program for the potential treatment of hyperphenylalaninemia ( “ hpa ” ) ( also referred to as pku ) in humans . pku is an inherited metabolic disorder in which the enzyme that converts the essential amino acid phenylalanine into tyrosine is deficient . in october 2017 , we announced a strategic collaboration with nestlé health science to advance cdx-6114 , our own novel orally administrable enzyme therapeutic candidate for the potential treatment of pku . in july 2018 , we announced that we had dosed the first subjects in a first-in-human phase 1a dose-escalation trial with cdx-6114 , which was conducted in australia . in november 2018 , we announced top-line results from the phase 1a study in healthy volunteers with cdx-6114 . in december 2018 , nestlé health science became obligated to pay us an additional $ 1.0 million within 60 days after the achievement of a milestone relating to formulation of cdx-6114 . story_separator_special_tag under the strategic collaboration agreement , we received an 58 upfront payment of $ 1.2 million in 2017 and an incremental $ 0.6 million payment in september 2018 for additional services . we recognized research and development fees of $ 3.6 million and $ 0.5 million in 2018 and 2017 , respectively . as of december 31 , 2018 and 2017 , we had deferred revenue of $ 0.8 million and $ 1.1 million , respectively . strategic collaboration agreement in april 2018 , we entered into the porton agreement with porton to license key elements of codexis ' biocatalyst technology for use in porton 's global custom intermediate and api development and manufacturing business . under the porton agreement , we are eligible to receive annual collaboration fees and research and development revenues . we received an initial collaboration fee of $ 0.5 million within 30 days of the effective date of the agreement . as of december 31 , 2018 , we completed the technical transfer and we recognized revenue of $ 2.8 million in 2018 as research and development revenue . revenue relating to the functional license provided to porton was recognized at a point in time when control of the license transferred and technology transfer to the customer . we have the potential to receive performance payments based on products produced by porton using our company 's technology under the license agreement . recent accounting pronouncements for information on recent accounting pronouncements , see note 2 , “ summary of significant accounting policies ” , to the consolidated financial statements set forth in item 8 of this annual report on form 10-k. financial results for the year ended december 31 , 2018 , as compared to the year ended december 31 , 2017 , reflect the effects of adopting asu 2014-09 , “ revenue from contracts with customers ( topic 606 ) , ” and the related amendments ( “ asc 606 ” ) , which provided a new basis of accounting for our revenue arrangements during fiscal 2018. the adoption of asc 606 limits the comparability of revenue and certain expenses , including revenues and costs and operating expenses , presented in the results of operations for the year ended december 31 , 2018 when compared to the year ended december 31 , 2017. for additional information regarding the impact from adoption of this accounting standard , see note 3 , “ revenue recognition ” to the consolidated financial statements set forth in item 8 of this annual report on form 10-k. results of operations the following table shows the amounts from our consolidated statements of operations for the periods presented ( in thousands , except percentages ) : replace_table_token_4_th 59 revenues our revenues are comprised of product revenue and research and development revenue as follows : product revenue consist of sales of protein catalysts , pharmaceutical intermediates , and codex ® biocatalyst panels and kits . research and development revenue include license , technology access and exclusivity fees , research services fees , milestone payments , royalties , optimization and screening fees , and revenue sharing arrangement based upon sales of licensed products by our former revenue sharing partner , exela pharmsci , inc. ( “ exela ” ) in 2017 and 2016. revenues is as follows ( in thousands , except percentages ) : replace_table_token_5_th revenues typically fluctuate on a quarterly basis due to the variability in our customers ' manufacturing schedules and the timing of our customers ' clinical trials . in addition , we have limited internal capacity to manufacture enzymes . as a result , we are dependent upon the performance and capacity of third party manufacturers for the commercial scale manufacturing of the enzymes used in our pharmaceutical and fine chemicals business . we accept purchase orders for deliveries covering periods from one day up to approximately one year from the date on which the order is placed . however , a majority of the purchase orders can be revised or cancelled by the customer without penalty . considering these industry practices and our experience , we do not believe the total of customer purchase orders outstanding ( backlog ) provides meaningful information that can be relied on to predict actual sales for future periods . 2018 compared to 2017 total revenues increased by $ 10.6 million in 2018 to $ 60.6 million , as compared to 2017 . the increase was driven by growth in research and development revenue of $ 11.7 million or 50 % , partially offset by a decrease of $ 1.1 million in product revenue . product revenue , which consist primarily of sales of protein catalysts , pharmaceutical intermediates , and codex ® biocatalyst panels and kits , were $ 25.6 million in 2018 , a decrease of 4 % compared with $ 26.7 million in 2017 . the decrease was primarily due to variability in our customers ' manufacturing schedules . research and development revenue increased by $ 11.7 million in 2018 to $ 35.0 million , as compared to 2017 , primarily due to revenues from our arrangements with nestlé health science for the development of cdx-6114 and development of novel enzymes for nestlé health science under our strategic collaboration agreement , research and development revenue from tate & lyle , merck and novartis , and on the recognition of a functional license fee and technology transfer from porton . 2017 compared to 2016 total revenues increased by $ 1.2 million in 2017 to $ 50.0 million , as compared to 2016. the increase was driven by an increase in product revenue of $ 11.4 million or 74 % , offset by a decrease of $ 10.2 million in research and development revenue . product revenue , which consist primarily of sales of protein catalysts , pharmaceutical intermediates , and codex ® biocatalyst panels and kits , were $ 26.7 million in 2017 , an increase of 74 % compared with

the comms transaction was aimed at extending netscout 's reach into growth-oriented adjacent markets , including cybersecurity , with a broader range of market-leading products and capabilities ; strengthening its go-to-market resources to better support a larger , more diverse and more global customer base ; and increasing netscout 's scale and elevating its strategic position within key accounts . on august 19 , 2016 , we acquired certain assets and liabilities of avvasi for $ 4.6 million . avvasi 's technology allows service providers to measure , improve and monetize video in their networks . this acquisition builds on netscout 's ongoing investment in enhancing its service assurance capabilities for video traffic over 4g/lte networks . for additional information regarding the avvasi acquisition , see note 7 of our notes to consolidated financial statements . during the second quarter of fiscal year 2017 , as part of our continued integration efforts of the comms transaction , we reorganized our business units . as a result , we account for our operations under one reportable segment . on september 20 , 2016 , netscout 's stockholders approved an amendment to the third amended and restated certificate of incorporation to increase the number of authorized shares of common stock , par value $ 0.001 per share , from 150,000,000 to 300,000,000 shares . the increase in authorized shares of common stock has been reflected in our financial statements . results overview we continued to navigate through challenging market conditions , which have primarily impacted the timing and magnitude of orders with service provider customers . despite the difficult selling environment , we have maintained relatively unchanged revenue , slightly improved our gross profit margins and increased our income from operations and income from operations margin due to the combination of investment and decreased costs related to the comms transaction when compared to the twelve months ended march 31 , 2016. netscout 's financial results for the fiscal year ended march 31 , 2016 include approximately eight and one-half months of contribution from the communications business . we continue to maintain strong liquidity . at march 31 , 2017 , we had cash , cash equivalents and marketable securities of $ 464.7 million . this represents an increase of $ 112.6 million over the previous fiscal year ended march 31 , 2016 . this increase was due to cash flows from operations of $ 227.8 million which was partially offset by $ 80.0 million used to repurchase shares of our common stock under our repurchase program , $ 29.7 million of cash used for capital expenditures and $ 4.6 million used in the avvasi acquisition during the twelve months ended march 31 , 2017. use of non-gaap financial measures we supplement the united states generally accepted accounting principles ( gaap ) financial measures we report in quarterly and annual earnings announcements , investor presentations and other investor communications by reporting the following non-gaap measures : non-gaap total revenue , non-gaap product revenue , non-gaap service revenue , non-gaap income from operations , non-gaap operating margin , non-gaap earnings before interest and other expense , income taxes , depreciation and amortization ( ebitda ) from operations , non-gaap ebidta from operations margin , non-gaap net income , and non-gaap net income per share ( diluted ) . non-gaap revenue ( total , product and service ) eliminates the gaap effects of acquisitions by adding back revenue related to deferred revenue revaluation , as well as revenue impacted by the amortization of acquired intangible assets . non-gaap gross profit includes the foregoing adjustments and also removes expenses related to the amortization of acquired intangible assets , stock-based compensation , certain expenses relating to acquisitions including inventory fair value adjustments , depreciation costs , compensation for post-combination services and business development and integration costs . non-gaap income from operations includes the foregoing adjustments and also removes restructuring charges . non-gaap operating margin is calculated based on the non-gaap financial metrics discussed above . non-gaap ebitda from operations includes the aforementioned items related to non-gaap income from operations and also removes non-acquisition-related depreciation expense . non-gaap net income includes the foregoing adjustments and also removes expenses related to share-based compensation and certain expenses relating to acquisitions including : compensation for post-combination services , business development charges , and depreciation expense , net of related income tax effects . non-gaap diluted net income per share also excludes these expenses as well as the related impact of all these adjustments on the provision for income taxes . 33 these non-gaap measures are not in accordance with gaap , should not be considered an alternative for measures prepared in accordance with gaap ( revenue , gross profit , operating profit , net income ( loss ) and diluted net income ( loss ) per share ) , and may have limitations in that they do not reflect all our results of operations as determined in accordance with gaap . these non-gaap measures should only be used to evaluate our results of operations in conjunction with the corresponding gaap measures . the presentation of non-gaap information is not meant to be considered superior to , in isolation from , or as a substitute for results prepared in accordance with gaap . management believes these non-gaap financial measures enhance the reader 's overall understanding of our current financial performance and our prospects for the future by providing a higher degree of transparency for certain financial measures and providing a level of disclosure that helps investors understand how we plan and measure our business . we believe that providing these non-gaap measures affords investors a view of our operating results that may be more easily compared to our peer companies and also enables investors to consider our operating results on both a gaap and non-gaap basis during and following the integration period of our acquisitions . story_separator_special_tag cost of revenue and gross profit cost of product revenue consists primarily of material components , manufacturing personnel expenses , packaging materials , overhead and amortization of capitalized software , acquired software and core technology . cost of service revenue consists primarily of personnel , material , overhead and support costs . replace_table_token_10_th product . the $ 35 thousand decrease in cost of product revenue was due to a $ 3.0 million decrease in direct material costs and a $ 2.3 million decrease in amortization of legacy netscout intangibles primarily due to the acceleration of amortization of certain intangibles during the twelve months ended march 31 , 2016 for the legacy netscout business . these decreases were partially offset by a $ 5.9 million increase in the incremental costs related to the comms transaction . the twelve months ended march 31 , 2016 only included eight and a half months of such expenses , as the comms transaction closed on july 14 , 2015. the product gross profit percentage increased by six percentage points to 68 % during the fiscal year ended march 31 , 2017 as compared to the same period in the prior year . average headcount in cost of product revenue was 96 and 100 for the fiscal years ended march 31 , 2017 and 2016 , respectively . service . the 20 % , or $ 17.7 million , increase in cost of service revenue was primarily due to a $ 16.0 million increase in the incremental costs related to the comms transaction . the twelve months ended march 31 , 2016 only included eight and a half months of such expenses , as the comms transaction closed on july 14 , 2015. in addition , in the legacy netscout business there was a $ 782 thousand increase in allocated overhead expenses , a $ 591 thousand increase in employee-related expenses due to an increase in headcount and a $ 506 thousand increase in software license expense . these increases were partially offset by a $ 717 thousand decrease in cost of materials used to support customers under service contracts in the legacy netscout business . the service gross profit percentage increased by three percentage points to 75 % for the twelve months ended march 31 , 2017 when compared to the twelve months ended march 31 , 2016. the 37 % , or $ 86.8 million , increase in service gross profit corresponds with the 32 % , or $ 104.6 million , increase in service revenue , partially offset by the 20 % , or $ 17.7 million , increase in cost of services . average headcount in cost of service revenue was 616 and 608 for the fiscal years ended march 31 , 2017 and 2016 , respectively . gross profit . our gross profit increase d 30 % , or $ 189.0 million . this increase is attributable to our increase in revenue of 22 % , or $ 206.7 million , partially offset by a $ 17.7 million , or 5 % , increase in cost of revenue . the gross margin percentage increased four percentage points to 70 % during the fiscal year ended march 31 , 2017 when compared to the same period in the prior year . 39 operating expenses replace_table_token_11_th research and development . research and development expenses consist primarily of personnel expenses , fees for outside consultants , overhead and related expenses associated with the development of new products and the enhancement of existing products . the 12 % , or $ 24.1 million , increase in research and development expenses compared to the same period last year was primarily due to a $ 23.5 million increase in the incremental costs related to the comms transaction . the twelve months ended march 31 , 2016 only included eight and a half months of such expenses , as the comms transaction closed on july 14 , 2015. average headcount in research and development was 1,210 and 1,224 for the fiscal years ended march 31 , 2017 and 2016 , respectively . sales and marketing . sales and marketing expenses consist primarily of personnel expenses , including commissions , overhead and other expenses associated with selling activities and marketing programs such as trade shows , seminars , advertising , and new product launch activities . the 12 % , or $ 35.3 million , increase in total sales and marketing expenses compared to the same period last year was primarily due to a $ 35.9 million increase in the incremental costs related to the comms transaction . the twelve months ended march 31 , 2016 only included eight and a half months of such expenses , as the comms transaction closed on july 14 , 2015. average headcount in sales and marketing was 935 and 930 for the fiscal years ended march 31 , 2017 and 2016 , respectively . general and administrative . general and administrative expenses consist primarily of personnel expenses for executive , financial , legal and human resource employees , overhead and other corporate expenditures . the 1 % , or $ 724 thousand , increase in general and administrative expenses compared to the same period last year was primarily due a $ 15.0 million decrease in business development expenses related to the comms transaction and a $ 3.1 million decrease in the costs related to the comms transaction offset by a $ 6.6 million increase in compensation-related expenses , a $ 3.5 million increase in legal expenses , a $ 1.9 million increase in depreciation expense , a $ 1.6 million increase in allocated overhead expenses , a $ 1.3 million increase in software license expense , a $ 960 thousand increase in consulting and outside services fees and a $ 513 thousand increase in state franchise taxes in the legacy netscout business . average headcount in general and administrative was 283 and 282 for the fiscal years ended march 31 , 2017

cash provided by operating activities was $ 227.8 million during the fiscal year ended march 31 , 2017 , compared to $ 95.3 million of cash provided by operating activities in the fiscal year ended march 31 , 2016 . this $ 132.5 million increase was due in part to a $ 61.7 million increase from net income , a $ 47.5 million net increase from amounts due to and from related parties as a result of the comms transaction , a $ 31.1 million increase from deferred income taxes , a $ 20.8 million increase from depreciation and amortization , a $ 10.8 million increase from share-based compensation expense , a $ 7.4 million increase from deferred revenue , a $ 6.9 million increase from inventories , a $ 4.7 million increase from prepaid expenses and other assets and a $ 1.0 million increase from income taxes payable . these increases were partially offset by a $ 26.5 million decrease from accrued compensation and other expenses and a $ 24.8 million unfavorable impact from accounts receivable and unbilled costs . accounts receivable days sales outstanding was 80 days at march 31 , 2017 compared to 80 days at march 31 , 2016 and 61 days at march 31 , 2015. in addition , there was a $ 6.6 million decrease from deal-related compensation expense and accretion charges and a $ 1.9 million decrease in cash inflows from accounts payable related to the normalization of the accounts payable balances across the larger business during twelve months ended march 31 , 2017 as compared to the twelve months ended march 31 , 2016. fiscal year 2016 compared to fiscal year 2015 cash provided by operating activities was $ 95.3 million during the fiscal year ended march 31 , 2016 , compared to $ 106.9 million of cash provided by operating activities in the fiscal year ended

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```cash provided by operating activities was $ 227.8 million during the fiscal year ended march 31 , 2017 , compared to $ 95.3 million of cash provided by operating activities in the fiscal year ended march 31 , 2016 . this $ 132.5 million increase was due in part to a $ 61.7 million increase from net income , a $ 47.5 million net increase from amounts due to and from related parties as a result of the comms transaction , a $ 31.1 million increase from deferred income taxes , a $ 20.8 million increase from depreciation and amortization , a $ 10.8 million increase from share-based compensation expense , a $ 7.4 million increase from deferred revenue , a $ 6.9 million increase from inventories , a $ 4.7 million increase from prepaid expenses and other assets and a $ 1.0 million increase from income taxes payable . these increases were partially offset by a $ 26.5 million decrease from accrued compensation and other expenses and a $ 24.8 million unfavorable impact from accounts receivable and unbilled costs . accounts receivable days sales outstanding was 80 days at march 31 , 2017 compared to 80 days at march 31 , 2016 and 61 days at march 31 , 2015. in addition , there was a $ 6.6 million decrease from deal-related compensation expense and accretion charges and a $ 1.9 million decrease in cash inflows from accounts payable related to the normalization of the accounts payable balances across the larger business during twelve months ended march 31 , 2017 as compared to the twelve months ended march 31 , 2016. fiscal year 2016 compared to fiscal year 2015 cash provided by operating activities was $ 95.3 million during the fiscal year ended march 31 , 2016 , compared to $ 106.9 million of cash provided by operating activities in the fiscal year ended ``` Suspicious Activity Report : the comms transaction was aimed at extending netscout 's reach into growth-oriented adjacent markets , including cybersecurity , with a broader range of market-leading products and capabilities ; strengthening its go-to-market resources to better support a larger , more diverse and more global customer base ; and increasing netscout 's scale and elevating its strategic position within key accounts . on august 19 , 2016 , we acquired certain assets and liabilities of avvasi for $ 4.6 million . avvasi 's technology allows service providers to measure , improve and monetize video in their networks . this acquisition builds on netscout 's ongoing investment in enhancing its service assurance capabilities for video traffic over 4g/lte networks . for additional information regarding the avvasi acquisition , see note 7 of our notes to consolidated financial statements . during the second quarter of fiscal year 2017 , as part of our continued integration efforts of the comms transaction , we reorganized our business units . as a result , we account for our operations under one reportable segment . on september 20 , 2016 , netscout 's stockholders approved an amendment to the third amended and restated certificate of incorporation to increase the number of authorized shares of common stock , par value $ 0.001 per share , from 150,000,000 to 300,000,000 shares . the increase in authorized shares of common stock has been reflected in our financial statements . results overview we continued to navigate through challenging market conditions , which have primarily impacted the timing and magnitude of orders with service provider customers . despite the difficult selling environment , we have maintained relatively unchanged revenue , slightly improved our gross profit margins and increased our income from operations and income from operations margin due to the combination of investment and decreased costs related to the comms transaction when compared to the twelve months ended march 31 , 2016. netscout 's financial results for the fiscal year ended march 31 , 2016 include approximately eight and one-half months of contribution from the communications business . we continue to maintain strong liquidity . at march 31 , 2017 , we had cash , cash equivalents and marketable securities of $ 464.7 million . this represents an increase of $ 112.6 million over the previous fiscal year ended march 31 , 2016 . this increase was due to cash flows from operations of $ 227.8 million which was partially offset by $ 80.0 million used to repurchase shares of our common stock under our repurchase program , $ 29.7 million of cash used for capital expenditures and $ 4.6 million used in the avvasi acquisition during the twelve months ended march 31 , 2017. use of non-gaap financial measures we supplement the united states generally accepted accounting principles ( gaap ) financial measures we report in quarterly and annual earnings announcements , investor presentations and other investor communications by reporting the following non-gaap measures : non-gaap total revenue , non-gaap product revenue , non-gaap service revenue , non-gaap income from operations , non-gaap operating margin , non-gaap earnings before interest and other expense , income taxes , depreciation and amortization ( ebitda ) from operations , non-gaap ebidta from operations margin , non-gaap net income , and non-gaap net income per share ( diluted ) . non-gaap revenue ( total , product and service ) eliminates the gaap effects of acquisitions by adding back revenue related to deferred revenue revaluation , as well as revenue impacted by the amortization of acquired intangible assets . non-gaap gross profit includes the foregoing adjustments and also removes expenses related to the amortization of acquired intangible assets , stock-based compensation , certain expenses relating to acquisitions including inventory fair value adjustments , depreciation costs , compensation for post-combination services and business development and integration costs . non-gaap income from operations includes the foregoing adjustments and also removes restructuring charges . non-gaap operating margin is calculated based on the non-gaap financial metrics discussed above . non-gaap ebitda from operations includes the aforementioned items related to non-gaap income from operations and also removes non-acquisition-related depreciation expense . non-gaap net income includes the foregoing adjustments and also removes expenses related to share-based compensation and certain expenses relating to acquisitions including : compensation for post-combination services , business development charges , and depreciation expense , net of related income tax effects . non-gaap diluted net income per share also excludes these expenses as well as the related impact of all these adjustments on the provision for income taxes . 33 these non-gaap measures are not in accordance with gaap , should not be considered an alternative for measures prepared in accordance with gaap ( revenue , gross profit , operating profit , net income ( loss ) and diluted net income ( loss ) per share ) , and may have limitations in that they do not reflect all our results of operations as determined in accordance with gaap . these non-gaap measures should only be used to evaluate our results of operations in conjunction with the corresponding gaap measures . the presentation of non-gaap information is not meant to be considered superior to , in isolation from , or as a substitute for results prepared in accordance with gaap . management believes these non-gaap financial measures enhance the reader 's overall understanding of our current financial performance and our prospects for the future by providing a higher degree of transparency for certain financial measures and providing a level of disclosure that helps investors understand how we plan and measure our business . we believe that providing these non-gaap measures affords investors a view of our operating results that may be more easily compared to our peer companies and also enables investors to consider our operating results on both a gaap and non-gaap basis during and following the integration period of our acquisitions . story_separator_special_tag cost of revenue and gross profit cost of product revenue consists primarily of material components , manufacturing personnel expenses , packaging materials , overhead and amortization of capitalized software , acquired software and core technology . cost of service revenue consists primarily of personnel , material , overhead and support costs . replace_table_token_10_th product . the $ 35 thousand decrease in cost of product revenue was due to a $ 3.0 million decrease in direct material costs and a $ 2.3 million decrease in amortization of legacy netscout intangibles primarily due to the acceleration of amortization of certain intangibles during the twelve months ended march 31 , 2016 for the legacy netscout business . these decreases were partially offset by a $ 5.9 million increase in the incremental costs related to the comms transaction . the twelve months ended march 31 , 2016 only included eight and a half months of such expenses , as the comms transaction closed on july 14 , 2015. the product gross profit percentage increased by six percentage points to 68 % during the fiscal year ended march 31 , 2017 as compared to the same period in the prior year . average headcount in cost of product revenue was 96 and 100 for the fiscal years ended march 31 , 2017 and 2016 , respectively . service . the 20 % , or $ 17.7 million , increase in cost of service revenue was primarily due to a $ 16.0 million increase in the incremental costs related to the comms transaction . the twelve months ended march 31 , 2016 only included eight and a half months of such expenses , as the comms transaction closed on july 14 , 2015. in addition , in the legacy netscout business there was a $ 782 thousand increase in allocated overhead expenses , a $ 591 thousand increase in employee-related expenses due to an increase in headcount and a $ 506 thousand increase in software license expense . these increases were partially offset by a $ 717 thousand decrease in cost of materials used to support customers under service contracts in the legacy netscout business . the service gross profit percentage increased by three percentage points to 75 % for the twelve months ended march 31 , 2017 when compared to the twelve months ended march 31 , 2016. the 37 % , or $ 86.8 million , increase in service gross profit corresponds with the 32 % , or $ 104.6 million , increase in service revenue , partially offset by the 20 % , or $ 17.7 million , increase in cost of services . average headcount in cost of service revenue was 616 and 608 for the fiscal years ended march 31 , 2017 and 2016 , respectively . gross profit . our gross profit increase d 30 % , or $ 189.0 million . this increase is attributable to our increase in revenue of 22 % , or $ 206.7 million , partially offset by a $ 17.7 million , or 5 % , increase in cost of revenue . the gross margin percentage increased four percentage points to 70 % during the fiscal year ended march 31 , 2017 when compared to the same period in the prior year . 39 operating expenses replace_table_token_11_th research and development . research and development expenses consist primarily of personnel expenses , fees for outside consultants , overhead and related expenses associated with the development of new products and the enhancement of existing products . the 12 % , or $ 24.1 million , increase in research and development expenses compared to the same period last year was primarily due to a $ 23.5 million increase in the incremental costs related to the comms transaction . the twelve months ended march 31 , 2016 only included eight and a half months of such expenses , as the comms transaction closed on july 14 , 2015. average headcount in research and development was 1,210 and 1,224 for the fiscal years ended march 31 , 2017 and 2016 , respectively . sales and marketing . sales and marketing expenses consist primarily of personnel expenses , including commissions , overhead and other expenses associated with selling activities and marketing programs such as trade shows , seminars , advertising , and new product launch activities . the 12 % , or $ 35.3 million , increase in total sales and marketing expenses compared to the same period last year was primarily due to a $ 35.9 million increase in the incremental costs related to the comms transaction . the twelve months ended march 31 , 2016 only included eight and a half months of such expenses , as the comms transaction closed on july 14 , 2015. average headcount in sales and marketing was 935 and 930 for the fiscal years ended march 31 , 2017 and 2016 , respectively . general and administrative . general and administrative expenses consist primarily of personnel expenses for executive , financial , legal and human resource employees , overhead and other corporate expenditures . the 1 % , or $ 724 thousand , increase in general and administrative expenses compared to the same period last year was primarily due a $ 15.0 million decrease in business development expenses related to the comms transaction and a $ 3.1 million decrease in the costs related to the comms transaction offset by a $ 6.6 million increase in compensation-related expenses , a $ 3.5 million increase in legal expenses , a $ 1.9 million increase in depreciation expense , a $ 1.6 million increase in allocated overhead expenses , a $ 1.3 million increase in software license expense , a $ 960 thousand increase in consulting and outside services fees and a $ 513 thousand increase in state franchise taxes in the legacy netscout business . average headcount in general and administrative was 283 and 282 for the fiscal years ended march 31 , 2017

recent changes in the offshore drilling market have led to a highly competitive contracting environment . since october 1 , 2014 , the brent crude oil price has declined from approximately $ 95 per barrel to approximately $ 60 per barrel on february 23 , 2015 . operators have announced significant declines in capital spending in their 2015 budgets , including the cancellation or deferral of existing programs . these declines in capital spending levels , coupled with additional newbuild supply , have put significant pressure on day rates and utilization . we expect that 2015 will be a challenging year for drilling contractors as customers wait to gain additional clarity on commodity pricing and seek to reduce costs in the near-term by attempting to sub-let contracted rig time and re-negotiate existing contract terms . we believe the current market dynamics will create a challenging contracting environment into 2016. since most factors that affect offshore exploration and development spending are beyond our control and because rig demand can change quickly , it is difficult for us to predict future industry conditions , demand trends or future operating results . periods of low rig demand often result in excess rig supply , which generally results in reductions in utilization and day rates ; conversely , periods of high rig demand often result in a shortage of rigs , which generally results in increased utilization and day rates . drilling rig supply during the current newbuild cycle , various industry participants ordered the construction of 360 new drillships , semisubmersible rigs and jackup rigs , approximately 160 of which were delivered during the last three years . currently , there are approximately 80 competitive newbuild drillships and semisubmersible rigs reported to be under construction , of which approximately 30 are expected to be delivered before the end of 2015. roughly half of the anticipated 2015 deliveries are without contracts , leading drilling contractors to retire or stack 35 older floaters since september 2014 due to a lack of available contracting opportunities . we expect that additional floaters will be retired or stacked during 2015 as lower commodity prices have negatively impacted the number of incremental contracting opportunities . currently , there are approximately 120 competitive newbuild jackup rigs reported to be under construction , of which approximately half are being built by companies that have not historically operated offshore drilling rigs . approximately 60 of these competitive newbuild jackups are expected before the end of 2015 and most of these rigs are without contracts . as a result , we expect retirements and stacking of jackups to accelerate during 2015. currently , there are approximately 40 marketed jackups older than 30 years of age that are idle and do not have any contracted work . additionally , approximately 80 competitive jackups that are 30 years of age or older have contracts that expire during 2015. operating costs for idle rigs , as well as capital expenditures required to recertify rigs during regulatory surveys , may prove cost prohibitive , and drilling contractors may instead elect to retire or stack these rigs . rig loss or damage due to hurricanes , blowouts , craterings , punchthroughs and other operational events , and the limited availability of insurance for certain perils in some geographic regions , may impact the supply of offshore drilling rigs in a particular market and cause fluctuations in utilization and day rates . 50 drilling rig construction and delivery we remain focused on our long-established strategy of high-grading our fleet . we will continue to invest in the expansion of our fleet where we believe strategic opportunities exist . during the three-year period ended december 31 , 2014 , we invested $ 3.3 billion in the construction of new drilling rigs . during the second quarter , we entered into an agreement with lamprell energy limited to construct two premium jackup rigs ( ensco 140 and ensco 141 ) . ensco 140 and ensco 141 are significantly enhanced versions of the letorneau super 116e jackup design and will incorporate ensco 's patented canti-leverage advantage sm technology . these rigs are scheduled for delivery during the second quarter and the third quarter of 2016 , respectively . both of these rigs are currently uncontracted . during 2013 , we entered into agreements with kfels to construct a premium jackup rig ( ensco 110 ) and an ultra-premium harsh environment jackup rig ( ensco 123 ) . these rigs are scheduled for delivery during the first quarter of 2015 and the second quarter of 2016 , respectively . both of these rigs are currently uncontracted . we previously entered into agreements with kfels to construct three ultra-premium harsh environment jackup rigs ( ensco 120 , ensco 121 and ensco 122 ) . ensco 122 was delivered during the third quarter of 2014 and commenced drilling operations under a long-term contract in the north sea during the fourth quarter of 2014. ensco 121 was delivered during the fourth quarter of 2013 and commenced drilling operations under a long-term contract in the north sea during the second quarter of 2014. ensco 120 was delivered during the third quarter of 2013 and commenced drilling operations under a long-term contract in the north sea during the first quarter of 2014. we currently have three ultra-deepwater drillships under construction ( ensco ds-8 , ensco ds-9 and ensco ds-10 ) . ensco ds-9 and ensco ds-8 are committed under long-term contracts and currently scheduled for delivery during the first quarter and second quarter of 2015 , respectively . ensco ds-10 is currently uncontracted and scheduled for delivery during the third quarter of 2015. the expected delivery dates of our rig construction projects are subject to risks and may be delayed due to shipyard or third-party equipment vendor delays or at our election . we expect cash flow generated during 2015 will primarily be used to fund capital expenditures , most notably milestone payments for newbuild rigs . story_separator_special_tag during 2013 , jackup revenues increased by $ 181.8 million , or 13 % , as compared to the prior year . the increase in revenues was primarily due to an increase in average day rates , mostly attributable to the u.s. gulf of mexico , north sea and southeast asia . contract drilling expense increased by $ 75.4 million , or 11 % , as compared to the prior year , primarily due to increased personnel costs . 57 impairment of long-lived assets during 2014 , we recorded a pre-tax , non cash loss on impairment of long-lived assets of $ 2,463.1 million , of which $ 1,220.8 million was included in ( loss ) income from continuing operations and $ 1,242.3 million was included in ( loss ) income from discontinued operations , net in our consolidated statement of operations . these losses were recorded during the second and fourth quarters . during the second quarter , demand for floaters deteriorated as a result of continued reductions in capital spending by operators in addition to delays in operators ' drilling programs . the reduction in demand , combined with the increasing supply from newbuild floater deliveries , led to a very competitive market . in general , contracting activity declined significantly , and day rates and utilization came under pressure , especially for older , less capable floaters . in response to the adverse change in the floaters business climate , management evaluated our older , less capable floaters and committed to a plan to sell five rigs . ensco 5000 , ensco 5001 , ensco 5002 , ensco 6000 and ensco 7500 were removed from our portfolio of rigs marketed for contract drilling services and actively marketed for sale . these rigs were written down to fair value , less costs to sell . we completed the sale of ensco 5000 in december 2014. the remaining four floaters were classified as `` held for sale `` on our december 31 , 2014 consolidated balance sheet . we measured the fair value of the `` held for sale `` rigs by applying a market approach , which was based on unobservable third-party estimated prices that would be received in exchange for the assets in an orderly transaction between market participants . we recorded a pre-tax , non-cash loss on impairment totaling $ 546.4 million during the second quarter associated with our `` held for sale `` rigs . the impairment charge was included in ( loss ) income from discontinued operations , net in our consolidated statement of operations for the year ended december 31 , 2014. during the fourth quarter , brent crude oil prices declined from approximately $ 95 per barrel to near $ 55 per barrel on december 31 , 2014 . these declines resulted in further reductions in capital spending by operators , including the cancellation or deferral of planned drilling programs . as a result , day rates and utilization came under further pressure , especially for older , less capable rigs . the significant supply and demand imbalance will continue to be adversely impacted by future newbuild deliveries , program delays and lower capital spending by operators . in response to the adverse change in business climate , management evaluated our aged rigs and committed to a plan to sell one additional floater and two jackups . ensco ds-2 , ensco 58 and ensco 90 were removed from our portfolio of rigs marketed for contract drilling services . these rigs were written down to fair value , less costs to sell , during the fourth quarter and classified as `` held for sale `` on our december 31 , 2014 consolidated balance sheet . as of december 31 , 2014 , we measured the fair value of our seven `` held for sale `` rigs by applying a market approach , which was based on unobservable third-party estimated prices that would be received in exchange for the assets in an orderly transaction between market participants . in addition to the asset impairment recorded during the second quarter , we recorded an additional pre-tax , non-cash loss on impairment totaling $ 407.9 million during the fourth quarter . the impairment charge was included in ( loss ) income from discontinued operations , net in our consolidated statement of operations for the year ended december 31 , 2014. see `` note 10 - discontinued operations `` for additional information on our `` held for sale `` rigs . on a quarterly basis , we evaluate the carrying value of our property and equipment to identify events or changes in circumstances ( `` triggering events `` ) that indicate the carrying value may not be recoverable . during the second quarter , as a result of the adverse change in the floater business climate , management 's decision to sell five floaters and the impairment charge incurred on the `` held for sale `` floaters , management concluded that a triggering event had occurred and performed an asset impairment analysis on our remaining older , less capable floaters . based on the analysis performed as of may 31 , 2014 , we recorded an additional pre-tax , non-cash loss on impairment with respect to four other floaters totaling $ 991.5 million , of which $ 288.0 million related to ensco ds-2 which was removed from our portfolio of rigs marketed for contract drilling services during the fourth quarter . the ensco ds-2 impairment charge was reclassified to ( loss ) income from discontinued operations , net in our consolidated statement of operations for the year ended december 31 , 2014. the remaining $ 703.5 million impairment charge was 58 included in loss on impairment in our consolidated statement of operations for the year ended december 31 , 2014. we measured the fair value of these rigs by applying an income approach , using projected discounted cash flows . these valuations were based on unobservable inputs

cash flows and capital expenditures our cash flows from operating activities of continuing operations and capital expenditures on continuing operations for each of the years in the three-year period ended december 31 , 2014 were as follows ( in millions ) : replace_table_token_19_th during 2014 , cash flows from continuing operations increased by $ 246.7 million , or 14 % , as compared to the prior year . the increase primarily resulted from a $ 503.1 million increase in cash receipts from contract drilling services , partially offset by a $ 259.2 million increase in cash payments related to contract drilling expenses . cash receipts from contract drilling services associated with customer reimbursed capital upgrades and mobilizations which are amortized to revenue over the term of the related contract totaled $ 267.0 million for the year ended december 31 , 2014 as compared to $ 70.0 million for the year ended december 31 , 2013 . 65 during 2013 , cash flows from continuing operations declined by $ 143.4 million , or 7 % , as compared to the prior year . the decrease primarily resulted from a $ 348.7 million increase in cash payments related to contract drilling expenses , a $ 117.5 million increase in cash payments for income taxes , a $ 40.2 million increase in cash payments for interest and a $ 28.8 million increase in cash payments related to general and administrative expenses , partially offset by a $ 378.8 million increase in cash receipts from contract drilling services . cash payments during 2013 related to contract drilling and general and administrative expenses were generally higher than the prior year due in part to the full year impact of the pride acquisition on certain annual payments made during 2013. annual payments made during the year ended december 31 , 2012 were based on seven months of acquired company operating activity . cash receipts from contract drilling services associated with customer reimbursed capital upgrades and mobilizations which are amortized to revenue over the term of the related contract totaled $ 70.0 million for the year ended december 31 , 2013 as compared to $ 260.0 million for the year ended december 31 , 2012.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```cash flows and capital expenditures our cash flows from operating activities of continuing operations and capital expenditures on continuing operations for each of the years in the three-year period ended december 31 , 2014 were as follows ( in millions ) : replace_table_token_19_th during 2014 , cash flows from continuing operations increased by $ 246.7 million , or 14 % , as compared to the prior year . the increase primarily resulted from a $ 503.1 million increase in cash receipts from contract drilling services , partially offset by a $ 259.2 million increase in cash payments related to contract drilling expenses . cash receipts from contract drilling services associated with customer reimbursed capital upgrades and mobilizations which are amortized to revenue over the term of the related contract totaled $ 267.0 million for the year ended december 31 , 2014 as compared to $ 70.0 million for the year ended december 31 , 2013 . 65 during 2013 , cash flows from continuing operations declined by $ 143.4 million , or 7 % , as compared to the prior year . the decrease primarily resulted from a $ 348.7 million increase in cash payments related to contract drilling expenses , a $ 117.5 million increase in cash payments for income taxes , a $ 40.2 million increase in cash payments for interest and a $ 28.8 million increase in cash payments related to general and administrative expenses , partially offset by a $ 378.8 million increase in cash receipts from contract drilling services . cash payments during 2013 related to contract drilling and general and administrative expenses were generally higher than the prior year due in part to the full year impact of the pride acquisition on certain annual payments made during 2013. annual payments made during the year ended december 31 , 2012 were based on seven months of acquired company operating activity . cash receipts from contract drilling services associated with customer reimbursed capital upgrades and mobilizations which are amortized to revenue over the term of the related contract totaled $ 70.0 million for the year ended december 31 , 2013 as compared to $ 260.0 million for the year ended december 31 , 2012. ``` Suspicious Activity Report : recent changes in the offshore drilling market have led to a highly competitive contracting environment . since october 1 , 2014 , the brent crude oil price has declined from approximately $ 95 per barrel to approximately $ 60 per barrel on february 23 , 2015 . operators have announced significant declines in capital spending in their 2015 budgets , including the cancellation or deferral of existing programs . these declines in capital spending levels , coupled with additional newbuild supply , have put significant pressure on day rates and utilization . we expect that 2015 will be a challenging year for drilling contractors as customers wait to gain additional clarity on commodity pricing and seek to reduce costs in the near-term by attempting to sub-let contracted rig time and re-negotiate existing contract terms . we believe the current market dynamics will create a challenging contracting environment into 2016. since most factors that affect offshore exploration and development spending are beyond our control and because rig demand can change quickly , it is difficult for us to predict future industry conditions , demand trends or future operating results . periods of low rig demand often result in excess rig supply , which generally results in reductions in utilization and day rates ; conversely , periods of high rig demand often result in a shortage of rigs , which generally results in increased utilization and day rates . drilling rig supply during the current newbuild cycle , various industry participants ordered the construction of 360 new drillships , semisubmersible rigs and jackup rigs , approximately 160 of which were delivered during the last three years . currently , there are approximately 80 competitive newbuild drillships and semisubmersible rigs reported to be under construction , of which approximately 30 are expected to be delivered before the end of 2015. roughly half of the anticipated 2015 deliveries are without contracts , leading drilling contractors to retire or stack 35 older floaters since september 2014 due to a lack of available contracting opportunities . we expect that additional floaters will be retired or stacked during 2015 as lower commodity prices have negatively impacted the number of incremental contracting opportunities . currently , there are approximately 120 competitive newbuild jackup rigs reported to be under construction , of which approximately half are being built by companies that have not historically operated offshore drilling rigs . approximately 60 of these competitive newbuild jackups are expected before the end of 2015 and most of these rigs are without contracts . as a result , we expect retirements and stacking of jackups to accelerate during 2015. currently , there are approximately 40 marketed jackups older than 30 years of age that are idle and do not have any contracted work . additionally , approximately 80 competitive jackups that are 30 years of age or older have contracts that expire during 2015. operating costs for idle rigs , as well as capital expenditures required to recertify rigs during regulatory surveys , may prove cost prohibitive , and drilling contractors may instead elect to retire or stack these rigs . rig loss or damage due to hurricanes , blowouts , craterings , punchthroughs and other operational events , and the limited availability of insurance for certain perils in some geographic regions , may impact the supply of offshore drilling rigs in a particular market and cause fluctuations in utilization and day rates . 50 drilling rig construction and delivery we remain focused on our long-established strategy of high-grading our fleet . we will continue to invest in the expansion of our fleet where we believe strategic opportunities exist . during the three-year period ended december 31 , 2014 , we invested $ 3.3 billion in the construction of new drilling rigs . during the second quarter , we entered into an agreement with lamprell energy limited to construct two premium jackup rigs ( ensco 140 and ensco 141 ) . ensco 140 and ensco 141 are significantly enhanced versions of the letorneau super 116e jackup design and will incorporate ensco 's patented canti-leverage advantage sm technology . these rigs are scheduled for delivery during the second quarter and the third quarter of 2016 , respectively . both of these rigs are currently uncontracted . during 2013 , we entered into agreements with kfels to construct a premium jackup rig ( ensco 110 ) and an ultra-premium harsh environment jackup rig ( ensco 123 ) . these rigs are scheduled for delivery during the first quarter of 2015 and the second quarter of 2016 , respectively . both of these rigs are currently uncontracted . we previously entered into agreements with kfels to construct three ultra-premium harsh environment jackup rigs ( ensco 120 , ensco 121 and ensco 122 ) . ensco 122 was delivered during the third quarter of 2014 and commenced drilling operations under a long-term contract in the north sea during the fourth quarter of 2014. ensco 121 was delivered during the fourth quarter of 2013 and commenced drilling operations under a long-term contract in the north sea during the second quarter of 2014. ensco 120 was delivered during the third quarter of 2013 and commenced drilling operations under a long-term contract in the north sea during the first quarter of 2014. we currently have three ultra-deepwater drillships under construction ( ensco ds-8 , ensco ds-9 and ensco ds-10 ) . ensco ds-9 and ensco ds-8 are committed under long-term contracts and currently scheduled for delivery during the first quarter and second quarter of 2015 , respectively . ensco ds-10 is currently uncontracted and scheduled for delivery during the third quarter of 2015. the expected delivery dates of our rig construction projects are subject to risks and may be delayed due to shipyard or third-party equipment vendor delays or at our election . we expect cash flow generated during 2015 will primarily be used to fund capital expenditures , most notably milestone payments for newbuild rigs . story_separator_special_tag during 2013 , jackup revenues increased by $ 181.8 million , or 13 % , as compared to the prior year . the increase in revenues was primarily due to an increase in average day rates , mostly attributable to the u.s. gulf of mexico , north sea and southeast asia . contract drilling expense increased by $ 75.4 million , or 11 % , as compared to the prior year , primarily due to increased personnel costs . 57 impairment of long-lived assets during 2014 , we recorded a pre-tax , non cash loss on impairment of long-lived assets of $ 2,463.1 million , of which $ 1,220.8 million was included in ( loss ) income from continuing operations and $ 1,242.3 million was included in ( loss ) income from discontinued operations , net in our consolidated statement of operations . these losses were recorded during the second and fourth quarters . during the second quarter , demand for floaters deteriorated as a result of continued reductions in capital spending by operators in addition to delays in operators ' drilling programs . the reduction in demand , combined with the increasing supply from newbuild floater deliveries , led to a very competitive market . in general , contracting activity declined significantly , and day rates and utilization came under pressure , especially for older , less capable floaters . in response to the adverse change in the floaters business climate , management evaluated our older , less capable floaters and committed to a plan to sell five rigs . ensco 5000 , ensco 5001 , ensco 5002 , ensco 6000 and ensco 7500 were removed from our portfolio of rigs marketed for contract drilling services and actively marketed for sale . these rigs were written down to fair value , less costs to sell . we completed the sale of ensco 5000 in december 2014. the remaining four floaters were classified as `` held for sale `` on our december 31 , 2014 consolidated balance sheet . we measured the fair value of the `` held for sale `` rigs by applying a market approach , which was based on unobservable third-party estimated prices that would be received in exchange for the assets in an orderly transaction between market participants . we recorded a pre-tax , non-cash loss on impairment totaling $ 546.4 million during the second quarter associated with our `` held for sale `` rigs . the impairment charge was included in ( loss ) income from discontinued operations , net in our consolidated statement of operations for the year ended december 31 , 2014. during the fourth quarter , brent crude oil prices declined from approximately $ 95 per barrel to near $ 55 per barrel on december 31 , 2014 . these declines resulted in further reductions in capital spending by operators , including the cancellation or deferral of planned drilling programs . as a result , day rates and utilization came under further pressure , especially for older , less capable rigs . the significant supply and demand imbalance will continue to be adversely impacted by future newbuild deliveries , program delays and lower capital spending by operators . in response to the adverse change in business climate , management evaluated our aged rigs and committed to a plan to sell one additional floater and two jackups . ensco ds-2 , ensco 58 and ensco 90 were removed from our portfolio of rigs marketed for contract drilling services . these rigs were written down to fair value , less costs to sell , during the fourth quarter and classified as `` held for sale `` on our december 31 , 2014 consolidated balance sheet . as of december 31 , 2014 , we measured the fair value of our seven `` held for sale `` rigs by applying a market approach , which was based on unobservable third-party estimated prices that would be received in exchange for the assets in an orderly transaction between market participants . in addition to the asset impairment recorded during the second quarter , we recorded an additional pre-tax , non-cash loss on impairment totaling $ 407.9 million during the fourth quarter . the impairment charge was included in ( loss ) income from discontinued operations , net in our consolidated statement of operations for the year ended december 31 , 2014. see `` note 10 - discontinued operations `` for additional information on our `` held for sale `` rigs . on a quarterly basis , we evaluate the carrying value of our property and equipment to identify events or changes in circumstances ( `` triggering events `` ) that indicate the carrying value may not be recoverable . during the second quarter , as a result of the adverse change in the floater business climate , management 's decision to sell five floaters and the impairment charge incurred on the `` held for sale `` floaters , management concluded that a triggering event had occurred and performed an asset impairment analysis on our remaining older , less capable floaters . based on the analysis performed as of may 31 , 2014 , we recorded an additional pre-tax , non-cash loss on impairment with respect to four other floaters totaling $ 991.5 million , of which $ 288.0 million related to ensco ds-2 which was removed from our portfolio of rigs marketed for contract drilling services during the fourth quarter . the ensco ds-2 impairment charge was reclassified to ( loss ) income from discontinued operations , net in our consolidated statement of operations for the year ended december 31 , 2014. the remaining $ 703.5 million impairment charge was 58 included in loss on impairment in our consolidated statement of operations for the year ended december 31 , 2014. we measured the fair value of these rigs by applying an income approach , using projected discounted cash flows . these valuations were based on unobservable inputs

executive summary highlights of our financial results as of and for the year ended december 31 , 2020 as compared to the same period of the prior year include the following : net sales were $ 1,024.4 million , a decrease of 12.4 % gross profit was $ 240.1 million , an increase of 0.3 % income from operations increased $ 17.9 million to $ 43.0 million net income attributable to astec increased to $ 46.9 million , or 110.3 % diluted earnings per share were $ 2.05 , an increase of 109.2 % significant items impacting operations in 2020 segment updates the company consists of a total of 33 compani es that are included in our consolidated financial statements , of which 25 represent our manufacturing sites and sites that operate as sales offices for our manufacturing locations . during the first quarter of 2020 , we completed an internal reorganization focused on transitioning from a decentralized management structure to a more centralized structure with major directives and decisions being made at the segment and or parent company level . as a result of this reorganization , we realigned our reportable segments moving from three to two reportable segments ( plus corporate ) - infrastructure solutions and materials solutions . our two reportable business segments comprise sites based upon the nature of the products or services produced , the type of customer for the products , the similarity of economic characteristics , the manner in which management reviews results and the nature of the production process , among other considerations . 22 table of contents the corporate category consists of our parent company and astec insurance company ( `` astec insurance `` ) , a captive insurance company , which do not meet the requirements for separate disclosure as an operating segment or inclusion in one of the other reporting segments . we evaluate performance and allocate resources to our operating segments based on profit or loss from operations before united states ( `` u.s. `` ) federal income taxes , state deferred taxes and corporate overhead and , thus , these costs are included in the corporate category . amounts previously reported under the previous segment structure have been restated to conform to the new segment structure . additionally , in both internal and external communications , we are transitioning references to each individual site by a name associated with its location , as compared to previous references to the individual subsidiary company name . covid-19 pandemic the covid-19 pandemic has caused significant disruptions to national and global economies . our u.s. based businesses are designated as essential businesses for critical infrastructure companies by the u.s. department of homeland security and , as such , have remained open throughout the pandemic . two of our foreign operations in the materials solutions segment , located in northern ireland and south africa , as dictated by their local governments , temporarily ceased manufacturing activities in late march 2020. the south africa site reopened on may 4 , 2020 , and the northern ireland facility reopened on may 11 , 2020. our top priority is to protect our employees and their families , our customers and suppliers and our operations from any adverse impacts by taking precautionary measures as directed by health authorities and local governments . in early march 2020 , we formed a covid-19 task force , which continually monitors information from government agencies , our sites , customers , suppliers and other sources . we have enacted several policies to combat the spread of the virus and keep our employees and visitors safe , including work at home initiatives , limits on employee travel , visitors policies , cleaning and disinfecting procedures and mandated temperature checks for visitors and employees . we are utilizing technology to hold meetings virtually as business permits . during 2020 , our sales and profits were negatively impacted by the covid-19 pandemic , and it may continue to negatively disrupt our business and results of operations in the future . the full extent of the covid-19 pandemic on our operations and the markets we serve remains highly uncertain and will depend largely on future developments related to the covid-19 pandemic , including infection rates increasing or returning in various geographic areas , the ultimate duration of the covid-19 pandemic , actions by government authorities to contain the outbreak or treat its impact , such as re-imposing previously lifted measures or putting in place additional restrictions , and the widespread distribution and acceptance of an effective vaccine , among other things . these developments are constantly evolving and can not be accurately predicted . see part i , item 1a . risk factors in this annual report on form 10-k. facility closures amm - in 2018 , management decided to close and cease operations at amm , located in germany . operations ceased in 2019 , and its land and building were sold in january 2020. albuquerque - in late 2019 , we announced the closing of our albuquerque site due to market conditions and underutilization of the manufacturing facility . responsibilities for manufacturing and marketing of albuquerque product lines were transferred to other facilities within the infrastructure solutions segment in late 2019 and early 2020. the albuquerque site was closed as of march 31 , 2020 , and its land and building were sold in the third quarter of 2020. enid - in late 2019 , we impaired and discontinued enid 's oil and gas drilling product lines and sold the remaining assets in the third quarter of 2020. in october 2020 , we sold the assets related to enid 's remaining water well line of business . enid 's land and building are currently being marketed for sale . mequon - in june 2020 , we announced the closing of our mequon facility in order to simplify and consolidate operations . story_separator_special_tag the segment profit increases were partially offset by net increases in restructuring , impairment and other property and equipment charges of $ 3.7 million in 2020 compared to 2019. materials solutions : segment profit for materials solutions was $ 32.1 million for 2020 compared to $ 22.8 million for the same period in 2019 , an increase of $ 9.3 million or 40.8 % . the increase in segment profit between periods was due primarily to an increase in the gross margin of 4.0 % between periods . additionally , the increase in segment profit was partially improved by decreased general and administrative expenses of $ 5.7 million , decreased selling expenses of $ 6.8 million due to right-sizing activities and benefit from net credits in restructuring , impairment and other property and equipment charges of $ 1.6 million primarily due to the gain on sale of land and building at our mequon facility in the fourth quarter of 2020. corporate : corporate operations incurred expenses of $ 40.1 million for 2020 compared to expenses of $ 35.6 million for 2019 , an unfavorable change of $ 4.5 million or 12.6 % , due primarily to an increase in consulting expenses of $ 3.1 million associated with information technology projects and other support projects and net restructuring , impairment and other property and equipment charges of $ 2.8 million offset by a reduction in income taxes of $ 4.4 million . 27 table of contents liquidity and capital resources our primary sources of liquidity and capital resources are cash on hand , borrowing capacity under a $ 150.0 million revolving credit facility ( the `` credit facility `` ) and cash flows from operations . we had $ 158.6 million of cash available for operating purposes as of december 31 , 2020 , of which $ 22.8 million was held by our foreign subsidiaries . we did not have any outstanding borrowings on the credit facility at december 31 , 2020 or 2019. in addition , no borrowings were made under the credit facility during 2020. our outstanding letters of credit totaling $ 7.6 million decreased borrowing availability to $ 142.4 million under the revolving credit facility as of december 31 , 2020. the revolving credit facility agreement contains certain financial covenants , including provisions concerning required levels of annual net income and minimum tangible net worth . we were in compliance with the financial covenants of the agreement at december 31 , 2020. our brazilian subsidiary maintains a separate term loan for working capital purposes with a bank in brazil , which is secured by its manufacturing facility . prior to 2020 , equipment financing loans were also outstanding . certain of our international subsidiaries in africa , australia , brazil , canada and northern ireland each have separate credit facilities with local financial institutions to finance short-term working capital needs , as well as to cover foreign exchange contracts , performance letters of credit , advance payment and retention guarantees . in addition , the brazilian subsidiary also enters into order anticipation agreements with a local bank on a periodic basis . both the outstanding borrowings under the credit facilities of the international subsidiaries and the order anticipation agreements are recorded in `` short-term debt `` on our consolidated balance sheets . each of the credit facilities are generally guaranteed by astec industries , inc. and or secured with certain assets of the local subsidiary except in brazil where the credit facilities are supported by letters of credit issued under the credit facility . cash flows from operating activities replace_table_token_5_th net cash provided by operating activities increased $ 28.9 million in 2020 compared to 2019. net income was the primary driver of the increase in operating cash flows and when combined with changes in large non-cash charges resulted in a total increase of $ 36.4 million . these increases were partially offset primarily by a lower decrease in inventory than prior year 2019 and reductions in customer deposits . story_separator_special_tag roman ' , sans-serif ; font-size:9pt ; font-style : italic ; font-weight:400 ; line-height:120 % ; text-decoration : underline `` > table of contents critical accounting policies and estimates our consolidated financial statements are prepared in accordance with u.s. generally accepted accounting principles . application of these principles requires us to make estimates and judgments that affect the amounts as reported in the consolidated financial statements . accounting policies that are critical to aid in understanding and evaluating the results of operations and financial position include the following : inventory valuation : inventories are valued at the lower of first-in first-out cost or net realizable value . the most significant component of our inventories is steel . open market prices and tariffs are subject to volatility and determine our cost of steel . during periods when open market prices decline , we may need to reduce the carrying value of the inventory . in addition , certain items in inventory become obsolete over time , and we reduce the carrying value of these items to their net realizable value . these reductions are determined by management based on estimates , assumptions and judgments made from the information available at that time . see note 2 , basis of presentation and significant accounting policies , of the notes to consolidated financial statements included in this annual report on form 10-k , for a description of our process used to value inventories at the lower of first-in first-out cost or net realizable value . we do not believe it is reasonably likely that the inventory values will materially change in the near future . revenue recognition : revenue is generally recognized when we satisfy a performance obligation by transferring control of goods or providing services . revenue is measured as the amount of consideration we expect to receive in exchange for transferring goods or providing services . we generally obtain purchase authorizations from our customers for a specified amount of

cash flows from investing activities replace_table_token_6_th net cash used by investing activities in 2020 were primarily due to acquisitions and expenditures for property and equipment . these cash uses were partially offset by proceeds from the sale of property and equipment and the sale of our enid subsidiary . net cash used by investing activities in 2019 were primarily due to property and equipment expenditures . 28 table of contents cash flows from financing activities replace_table_token_7_th financing activities in 2020 were primarily a use of cash for the payment of dividends while the use of cash in 2019 was primarily due to net repayments of our credit facility borrowings and the payment of dividends . financial condition our current assets increased to $ 565.8 million at december 31 , 2020 from $ 506.3 million at december 31 , 2019 , an increase of $ 59.5 million . the increase is due primarily to increases in cash and cash equivalents of $ 109.7 million offset by decreases in inventories of $ 44.8 million and trade receivables and contract assets , net of $ 4.4 million . accounts receivable days outstanding increased from 39.3 in 2019 to 45.3 in 2020. our current liabilities decreased to $ 170.3 million at december 31 , 2020 from $ 172.8 million at december 31 , 2019 , a decrease of $2.5 million .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```cash flows from investing activities replace_table_token_6_th net cash used by investing activities in 2020 were primarily due to acquisitions and expenditures for property and equipment . these cash uses were partially offset by proceeds from the sale of property and equipment and the sale of our enid subsidiary . net cash used by investing activities in 2019 were primarily due to property and equipment expenditures . 28 table of contents cash flows from financing activities replace_table_token_7_th financing activities in 2020 were primarily a use of cash for the payment of dividends while the use of cash in 2019 was primarily due to net repayments of our credit facility borrowings and the payment of dividends . financial condition our current assets increased to $ 565.8 million at december 31 , 2020 from $ 506.3 million at december 31 , 2019 , an increase of $ 59.5 million . the increase is due primarily to increases in cash and cash equivalents of $ 109.7 million offset by decreases in inventories of $ 44.8 million and trade receivables and contract assets , net of $ 4.4 million . accounts receivable days outstanding increased from 39.3 in 2019 to 45.3 in 2020. our current liabilities decreased to $ 170.3 million at december 31 , 2020 from $ 172.8 million at december 31 , 2019 , a decrease of $2.5 million . ``` Suspicious Activity Report : executive summary highlights of our financial results as of and for the year ended december 31 , 2020 as compared to the same period of the prior year include the following : net sales were $ 1,024.4 million , a decrease of 12.4 % gross profit was $ 240.1 million , an increase of 0.3 % income from operations increased $ 17.9 million to $ 43.0 million net income attributable to astec increased to $ 46.9 million , or 110.3 % diluted earnings per share were $ 2.05 , an increase of 109.2 % significant items impacting operations in 2020 segment updates the company consists of a total of 33 compani es that are included in our consolidated financial statements , of which 25 represent our manufacturing sites and sites that operate as sales offices for our manufacturing locations . during the first quarter of 2020 , we completed an internal reorganization focused on transitioning from a decentralized management structure to a more centralized structure with major directives and decisions being made at the segment and or parent company level . as a result of this reorganization , we realigned our reportable segments moving from three to two reportable segments ( plus corporate ) - infrastructure solutions and materials solutions . our two reportable business segments comprise sites based upon the nature of the products or services produced , the type of customer for the products , the similarity of economic characteristics , the manner in which management reviews results and the nature of the production process , among other considerations . 22 table of contents the corporate category consists of our parent company and astec insurance company ( `` astec insurance `` ) , a captive insurance company , which do not meet the requirements for separate disclosure as an operating segment or inclusion in one of the other reporting segments . we evaluate performance and allocate resources to our operating segments based on profit or loss from operations before united states ( `` u.s. `` ) federal income taxes , state deferred taxes and corporate overhead and , thus , these costs are included in the corporate category . amounts previously reported under the previous segment structure have been restated to conform to the new segment structure . additionally , in both internal and external communications , we are transitioning references to each individual site by a name associated with its location , as compared to previous references to the individual subsidiary company name . covid-19 pandemic the covid-19 pandemic has caused significant disruptions to national and global economies . our u.s. based businesses are designated as essential businesses for critical infrastructure companies by the u.s. department of homeland security and , as such , have remained open throughout the pandemic . two of our foreign operations in the materials solutions segment , located in northern ireland and south africa , as dictated by their local governments , temporarily ceased manufacturing activities in late march 2020. the south africa site reopened on may 4 , 2020 , and the northern ireland facility reopened on may 11 , 2020. our top priority is to protect our employees and their families , our customers and suppliers and our operations from any adverse impacts by taking precautionary measures as directed by health authorities and local governments . in early march 2020 , we formed a covid-19 task force , which continually monitors information from government agencies , our sites , customers , suppliers and other sources . we have enacted several policies to combat the spread of the virus and keep our employees and visitors safe , including work at home initiatives , limits on employee travel , visitors policies , cleaning and disinfecting procedures and mandated temperature checks for visitors and employees . we are utilizing technology to hold meetings virtually as business permits . during 2020 , our sales and profits were negatively impacted by the covid-19 pandemic , and it may continue to negatively disrupt our business and results of operations in the future . the full extent of the covid-19 pandemic on our operations and the markets we serve remains highly uncertain and will depend largely on future developments related to the covid-19 pandemic , including infection rates increasing or returning in various geographic areas , the ultimate duration of the covid-19 pandemic , actions by government authorities to contain the outbreak or treat its impact , such as re-imposing previously lifted measures or putting in place additional restrictions , and the widespread distribution and acceptance of an effective vaccine , among other things . these developments are constantly evolving and can not be accurately predicted . see part i , item 1a . risk factors in this annual report on form 10-k. facility closures amm - in 2018 , management decided to close and cease operations at amm , located in germany . operations ceased in 2019 , and its land and building were sold in january 2020. albuquerque - in late 2019 , we announced the closing of our albuquerque site due to market conditions and underutilization of the manufacturing facility . responsibilities for manufacturing and marketing of albuquerque product lines were transferred to other facilities within the infrastructure solutions segment in late 2019 and early 2020. the albuquerque site was closed as of march 31 , 2020 , and its land and building were sold in the third quarter of 2020. enid - in late 2019 , we impaired and discontinued enid 's oil and gas drilling product lines and sold the remaining assets in the third quarter of 2020. in october 2020 , we sold the assets related to enid 's remaining water well line of business . enid 's land and building are currently being marketed for sale . mequon - in june 2020 , we announced the closing of our mequon facility in order to simplify and consolidate operations . story_separator_special_tag the segment profit increases were partially offset by net increases in restructuring , impairment and other property and equipment charges of $ 3.7 million in 2020 compared to 2019. materials solutions : segment profit for materials solutions was $ 32.1 million for 2020 compared to $ 22.8 million for the same period in 2019 , an increase of $ 9.3 million or 40.8 % . the increase in segment profit between periods was due primarily to an increase in the gross margin of 4.0 % between periods . additionally , the increase in segment profit was partially improved by decreased general and administrative expenses of $ 5.7 million , decreased selling expenses of $ 6.8 million due to right-sizing activities and benefit from net credits in restructuring , impairment and other property and equipment charges of $ 1.6 million primarily due to the gain on sale of land and building at our mequon facility in the fourth quarter of 2020. corporate : corporate operations incurred expenses of $ 40.1 million for 2020 compared to expenses of $ 35.6 million for 2019 , an unfavorable change of $ 4.5 million or 12.6 % , due primarily to an increase in consulting expenses of $ 3.1 million associated with information technology projects and other support projects and net restructuring , impairment and other property and equipment charges of $ 2.8 million offset by a reduction in income taxes of $ 4.4 million . 27 table of contents liquidity and capital resources our primary sources of liquidity and capital resources are cash on hand , borrowing capacity under a $ 150.0 million revolving credit facility ( the `` credit facility `` ) and cash flows from operations . we had $ 158.6 million of cash available for operating purposes as of december 31 , 2020 , of which $ 22.8 million was held by our foreign subsidiaries . we did not have any outstanding borrowings on the credit facility at december 31 , 2020 or 2019. in addition , no borrowings were made under the credit facility during 2020. our outstanding letters of credit totaling $ 7.6 million decreased borrowing availability to $ 142.4 million under the revolving credit facility as of december 31 , 2020. the revolving credit facility agreement contains certain financial covenants , including provisions concerning required levels of annual net income and minimum tangible net worth . we were in compliance with the financial covenants of the agreement at december 31 , 2020. our brazilian subsidiary maintains a separate term loan for working capital purposes with a bank in brazil , which is secured by its manufacturing facility . prior to 2020 , equipment financing loans were also outstanding . certain of our international subsidiaries in africa , australia , brazil , canada and northern ireland each have separate credit facilities with local financial institutions to finance short-term working capital needs , as well as to cover foreign exchange contracts , performance letters of credit , advance payment and retention guarantees . in addition , the brazilian subsidiary also enters into order anticipation agreements with a local bank on a periodic basis . both the outstanding borrowings under the credit facilities of the international subsidiaries and the order anticipation agreements are recorded in `` short-term debt `` on our consolidated balance sheets . each of the credit facilities are generally guaranteed by astec industries , inc. and or secured with certain assets of the local subsidiary except in brazil where the credit facilities are supported by letters of credit issued under the credit facility . cash flows from operating activities replace_table_token_5_th net cash provided by operating activities increased $ 28.9 million in 2020 compared to 2019. net income was the primary driver of the increase in operating cash flows and when combined with changes in large non-cash charges resulted in a total increase of $ 36.4 million . these increases were partially offset primarily by a lower decrease in inventory than prior year 2019 and reductions in customer deposits . story_separator_special_tag roman ' , sans-serif ; font-size:9pt ; font-style : italic ; font-weight:400 ; line-height:120 % ; text-decoration : underline `` > table of contents critical accounting policies and estimates our consolidated financial statements are prepared in accordance with u.s. generally accepted accounting principles . application of these principles requires us to make estimates and judgments that affect the amounts as reported in the consolidated financial statements . accounting policies that are critical to aid in understanding and evaluating the results of operations and financial position include the following : inventory valuation : inventories are valued at the lower of first-in first-out cost or net realizable value . the most significant component of our inventories is steel . open market prices and tariffs are subject to volatility and determine our cost of steel . during periods when open market prices decline , we may need to reduce the carrying value of the inventory . in addition , certain items in inventory become obsolete over time , and we reduce the carrying value of these items to their net realizable value . these reductions are determined by management based on estimates , assumptions and judgments made from the information available at that time . see note 2 , basis of presentation and significant accounting policies , of the notes to consolidated financial statements included in this annual report on form 10-k , for a description of our process used to value inventories at the lower of first-in first-out cost or net realizable value . we do not believe it is reasonably likely that the inventory values will materially change in the near future . revenue recognition : revenue is generally recognized when we satisfy a performance obligation by transferring control of goods or providing services . revenue is measured as the amount of consideration we expect to receive in exchange for transferring goods or providing services . we generally obtain purchase authorizations from our customers for a specified amount of

these declines were partially offset by higher tire unit volume , primarily in asia pacific . goodyear net income in 2015 was $ 307 million , compared to goodyear net income of $ 2,452 million in 2014 , and goodyear net income available to common shareholders was $ 307 million , or $ 1.12 per diluted share , compared to goodyear net income available to common shareholders of $ 2,445 million , or $ 8.78 per diluted share , in 2014 . the decrease in goodyear net income in 2015 compared to 2014 was primarily driven by an increase in income tax expense in 2015 as a result of the reversal of the valuation allowance on our u.s. deferred tax assets in the fourth quarter of 2014 and the loss on the deconsolidation of our venezuelan subsidiary , partially offset by the improvement in segment operating income and other ( income ) expense . other ( income ) expense in 2015 included increased royalty income due to the termination of a licensing agreement associated with the sale of our former engineered products business , the gain on the dissolution of the global alliance with sri and a benefit in general and product liability — discontinued products from the recovery of past costs from an asbestos insurer and changes in assumptions for probable insurance recoveries for asbestos claims . 22 our total segment operating income for 2015 was $ 2,022 million , compared to $ 1,712 million in 2014 . the $ 310 million , or 18.1 % , increase in segment operating income was due primarily to a decline in raw material costs of $ 594 million , which more than offset the impact of higher conversion costs of $ 149 million , unfavorable foreign currency translation of $ 145 million and higher selling , administrative and general expense ( `` sag `` ) of $ 70 million . segment operating income also benefited by an improvement in volume of $ 74 million . refer to `` results of operations — segment information ” for additional information . in order to drive future growth and address the volatile economic environment , we remain focused on our key strategies : continuing to focus on market-back product development ; taking a selective approach to the market , targeting profitable segments where we have competitive advantages ; improving our manufacturing efficiency and creating an advantaged supply chain focused on reducing our total delivered costs , optimizing working capital levels and delivering best in industry customer service ; focusing on cash flow to provide funding for our capital allocation plan described below ; and building top talent and teams . on february 9 , 2016 , we announced a $ 650 million increase in our share repurchase program , bringing the total authorized amount under that program to $ 1.1 billion . additionally , effective december 1 , 2015 , we increased the quarterly cash dividend on our common stock from $ 0.06 per share to $ 0.07 per share . our capital allocation plan also provides for capital expenditures , debt repayments and pension funding , and restructuring payments . refer to “ liquidity and capital resources — overview ” for additional information . pension and benefit plans at december 31 , 2015 , our unfunded global pension liability was $ 642 million , compared to $ 714 million at december 31 , 2014. as a result of the deconsolidation of our venezuelan subsidiary , the december 31 , 2015 unfunded global pension liability excludes $ 80 million of pension liabilities related to our venezuela pension plan . the unfunded global pension liability of $ 714 million at december 31 , 2014 included $ 43 million related to venezuela . our u.s. pension strategy includes the accelerated funding of pension plans in conjunction with significantly reducing exposure in the investment portfolio of those plans to future equity market movements . the fixed income investments held for these plans are designed to offset the subsequent impact of discount rate movements on the plans ' benefit obligations so that the funded status remains stable . the strategy also provides for the opportunistic settling of pension obligations when conditions warrant . during 2013 and 2014 , we contributed $ 2,035 million to fully fund our u.s. pension plans . consistent with our pension strategy , we transitioned those plans ' asset allocations to a portfolio of substantially all fixed income securities designed to offset subsequent changes in discount rates . as a result of the full funding of our hourly u.s. pension plans in 2014 , the pension benefits for hourly associates were frozen in 2014 , and these associates now receive company contributions to a defined contribution plan . our salaried u.s. pension plans were previously frozen . during 2015 , we completed programs to offer lump sums over a limited time to certain former employees in our u.s. pension plans . payments of $ 190 million related to this offer were made from existing plan assets to approximately 7,000 former employees who elected to receive a lump sum . as a result , total lump sum payments from these plans exceeded annual service and interest cost in 2015 ; therefore , we recognized a pre-tax corporate pension settlement charge of $ 137 million in the fourth quarter of 2015. these actions continue to provide stability to our funded status , improve our earnings and operating cash flow , and provide greater transparency to our underlying tire business . story_separator_special_tag other ( income ) expense also included financing fees and financial instruments expense of $ 111 million in 2015 , increasing $ 34 million from $ 77 million in 2014 . financing fees and financial instruments expense consists of the amortization of deferred financing fees , commitment fees and charges incurred in connection with financing transactions . financing fees in 2015 included a charge of $ 57 million ( $ 35 million after-tax and minority ) primarily related to a $ 41 million redemption premium and $ 14 million of expense for the write-off of deferred financing fees and unamortized discount related to the redemption of the $ 1.0 billion 8.25 % senior notes due 2020. other ( income ) expense in 2015 also included net gains on asset sales of $ 71 million ( $ 60 million after-tax and minority ) compared to net gains on asset sales of $ 3 million ( $ 4 million after-tax and minority ) in 2014. net gains on asset sales in 2015 included a net gain of $ 48 million ( $ 38 million after-tax and minority ) related to the dissolution of the global alliance with sri and a gain of $ 30 million ( $ 32 million after-tax and minority ) on the sale of our investment in shares of sri . refer to the note to the consolidated financial statements no . 5 , dissolution of global alliance with sumitomo rubber industries . net gains on asset sales in 2015 also included losses of $ 14 million in emea , primarily related to the sales of certain sub-saharan africa retail businesses . other ( income ) expense in 2015 and 2014 included charges of $ 4 million ( $ 4 million after-tax and minority ) and $ 22 million ( $ 22 million after-tax and minority ) , respectively , for labor claims related to a previously closed facility in greece . other ( income ) expense in 2014 also included charges of $ 16 million ( $ 16 million after-tax and minority ) related to a government investigation involving our compliance with the u.s. foreign corrupt practices act in certain countries in africa . for further information , refer to the note to the consolidated financial statements no . 4 , other ( income ) expense . income taxes income tax expense in 2015 was $ 232 million on income before income taxes of $ 608 million . for 2014 , income tax benefit was $ 1,834 million on income before income taxes of $ 687 million . the increase in income taxes for 2015 compared to 2014 was primarily due to the reversal of the tax valuation allowance on our net u.s. deferred tax assets in the fourth quarter of 2014. income tax expense for 2015 included discrete net tax benefits of $ 18 million ( $ 18 million after minority interest ) , due primarily to a $ 9 million benefit from the conclusion of non-u.s. tax claims and an $ 8 million benefit from the release of a valuation allowance related to u.s. state deferred tax assets . income tax benefit in 2014 was favorably impacted by $ 1,980 million ( $ 1,981 million after minority interest ) of discrete tax adjustments , including a benefit of $ 2,179 million from the december 31 , 2014 release of substantially all of the valuation allowance on our net u.s. deferred tax assets as discussed further below , partially offset by charges of $ 131 million to record deferred taxes on certain undistributed earnings of certain foreign subsidiaries . the 2014 income tax benefit also included charges of $ 37 million to establish valuation allowances on the net deferred tax assets of our venezuelan and brazilian subsidiaries , due to continuing operating losses and currency devaluations in venezuela , a charge of $ 9 million to establish a valuation allowance on the net deferred tax assets of a luxembourg subsidiary , and a charge of $ 11 million due to an enacted law change in chile . in 2015 , in addition to the items noted above , the difference between our effective tax rate and the u.s. statutory rate was primarily due to certain of our foreign subsidiaries continuing to maintain a full valuation allowance against their net deferred tax assets , the realization of $ 55 million of u.s. tax credits as a result of certain subsidiary dividend payments and legislation enacted in the fourth quarter of 2015 and $ 69 million of tax benefits related to the deconsolidation of our venezuelan subsidiary . at december 31 , 2015 , our valuation allowance on certain of our u.s. federal , state and local deferred tax assets was $ 98 million and our valuation allowance on our foreign deferred tax assets was $ 523 million . 27 our losses in various foreign taxing jurisdictions in recent periods represented sufficient negative evidence to require us to maintain a full valuation allowance against certain of our net deferred tax assets . each reporting period we assess available positive and negative evidence and estimate if sufficient future taxable income will be generated to utilize these existing deferred tax assets . if recent positive evidence provided by the profitability in certain emea subsidiaries continues , it will provide us the opportunity to apply greater significance to our forecasts in assessing the need for a valuation allowance . we believe it is reasonably possible that sufficient positive evidence required to release all , or a portion , of these valuation allowances will exist within the next twelve months . this may result in a reduction of the valuation allowance and one-time tax benefit of up to $ 275 million ( $ 275 million after minority interest ) . for further information , refer to the note to the consolidated financial statements no . 6 , income taxes . minority shareholders ' net income minority shareholders ' net income was $ 69

cash position at december 31 , 2015 , significant concentrations of cash and cash equivalents held by our international subsidiaries included the following amounts : $ 513 million or 35 % in europe , middle east and africa , primarily belgium ( $ 517 million or 24 % at december 31 , 2014 ) , $ 415 million or 28 % in asia , primarily china , india and australia ( $ 462 million or 21 % at december 31 , 2014 ) , and $ 114 million or 8 % in latin america , primarily brazil ( $ 409 million or 19 % at december 31 , 2014 , which primarily related to venezuela and brazil ) . operating activities net cash provided by operating activities was $ 1,687 million in 2015 , compared to $ 340 million in 2014 and $ 938 million in 2013 . the increase in cash provided by operating activities in 2015 versus 2014 was primarily due to decreased pension contributions and direct payments of $ 1,235 million . in 2014 , we made discretionary contributions of $ 907 million to fully fund our hourly u.s. pension plans . the decrease in cash provided by operating activities in 2014 versus 2013 was primarily due to working capital being neither a source nor use of cash in 2014 , versus a source of cash of $ 415 million in 2013 , and higher pension contributions of $ 176 million . pension contributions in both 2014 and 2013 were primarily due to discretionary contributions of $ 907 million and $ 834 million , respectively , to fully fund our u.s. pension plans . investing activities net cash used in investing activities was $ 1,262 million in 2015 , compared to $ 851 million in 2014 and $ 1,136 million in 2013 . capital expenditures were $ 983 million in 2015 , compared to $ 923 million in 2014 and $ 1,168 million in 2013 .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```cash position at december 31 , 2015 , significant concentrations of cash and cash equivalents held by our international subsidiaries included the following amounts : $ 513 million or 35 % in europe , middle east and africa , primarily belgium ( $ 517 million or 24 % at december 31 , 2014 ) , $ 415 million or 28 % in asia , primarily china , india and australia ( $ 462 million or 21 % at december 31 , 2014 ) , and $ 114 million or 8 % in latin america , primarily brazil ( $ 409 million or 19 % at december 31 , 2014 , which primarily related to venezuela and brazil ) . operating activities net cash provided by operating activities was $ 1,687 million in 2015 , compared to $ 340 million in 2014 and $ 938 million in 2013 . the increase in cash provided by operating activities in 2015 versus 2014 was primarily due to decreased pension contributions and direct payments of $ 1,235 million . in 2014 , we made discretionary contributions of $ 907 million to fully fund our hourly u.s. pension plans . the decrease in cash provided by operating activities in 2014 versus 2013 was primarily due to working capital being neither a source nor use of cash in 2014 , versus a source of cash of $ 415 million in 2013 , and higher pension contributions of $ 176 million . pension contributions in both 2014 and 2013 were primarily due to discretionary contributions of $ 907 million and $ 834 million , respectively , to fully fund our u.s. pension plans . investing activities net cash used in investing activities was $ 1,262 million in 2015 , compared to $ 851 million in 2014 and $ 1,136 million in 2013 . capital expenditures were $ 983 million in 2015 , compared to $ 923 million in 2014 and $ 1,168 million in 2013 . ``` Suspicious Activity Report : these declines were partially offset by higher tire unit volume , primarily in asia pacific . goodyear net income in 2015 was $ 307 million , compared to goodyear net income of $ 2,452 million in 2014 , and goodyear net income available to common shareholders was $ 307 million , or $ 1.12 per diluted share , compared to goodyear net income available to common shareholders of $ 2,445 million , or $ 8.78 per diluted share , in 2014 . the decrease in goodyear net income in 2015 compared to 2014 was primarily driven by an increase in income tax expense in 2015 as a result of the reversal of the valuation allowance on our u.s. deferred tax assets in the fourth quarter of 2014 and the loss on the deconsolidation of our venezuelan subsidiary , partially offset by the improvement in segment operating income and other ( income ) expense . other ( income ) expense in 2015 included increased royalty income due to the termination of a licensing agreement associated with the sale of our former engineered products business , the gain on the dissolution of the global alliance with sri and a benefit in general and product liability — discontinued products from the recovery of past costs from an asbestos insurer and changes in assumptions for probable insurance recoveries for asbestos claims . 22 our total segment operating income for 2015 was $ 2,022 million , compared to $ 1,712 million in 2014 . the $ 310 million , or 18.1 % , increase in segment operating income was due primarily to a decline in raw material costs of $ 594 million , which more than offset the impact of higher conversion costs of $ 149 million , unfavorable foreign currency translation of $ 145 million and higher selling , administrative and general expense ( `` sag `` ) of $ 70 million . segment operating income also benefited by an improvement in volume of $ 74 million . refer to `` results of operations — segment information ” for additional information . in order to drive future growth and address the volatile economic environment , we remain focused on our key strategies : continuing to focus on market-back product development ; taking a selective approach to the market , targeting profitable segments where we have competitive advantages ; improving our manufacturing efficiency and creating an advantaged supply chain focused on reducing our total delivered costs , optimizing working capital levels and delivering best in industry customer service ; focusing on cash flow to provide funding for our capital allocation plan described below ; and building top talent and teams . on february 9 , 2016 , we announced a $ 650 million increase in our share repurchase program , bringing the total authorized amount under that program to $ 1.1 billion . additionally , effective december 1 , 2015 , we increased the quarterly cash dividend on our common stock from $ 0.06 per share to $ 0.07 per share . our capital allocation plan also provides for capital expenditures , debt repayments and pension funding , and restructuring payments . refer to “ liquidity and capital resources — overview ” for additional information . pension and benefit plans at december 31 , 2015 , our unfunded global pension liability was $ 642 million , compared to $ 714 million at december 31 , 2014. as a result of the deconsolidation of our venezuelan subsidiary , the december 31 , 2015 unfunded global pension liability excludes $ 80 million of pension liabilities related to our venezuela pension plan . the unfunded global pension liability of $ 714 million at december 31 , 2014 included $ 43 million related to venezuela . our u.s. pension strategy includes the accelerated funding of pension plans in conjunction with significantly reducing exposure in the investment portfolio of those plans to future equity market movements . the fixed income investments held for these plans are designed to offset the subsequent impact of discount rate movements on the plans ' benefit obligations so that the funded status remains stable . the strategy also provides for the opportunistic settling of pension obligations when conditions warrant . during 2013 and 2014 , we contributed $ 2,035 million to fully fund our u.s. pension plans . consistent with our pension strategy , we transitioned those plans ' asset allocations to a portfolio of substantially all fixed income securities designed to offset subsequent changes in discount rates . as a result of the full funding of our hourly u.s. pension plans in 2014 , the pension benefits for hourly associates were frozen in 2014 , and these associates now receive company contributions to a defined contribution plan . our salaried u.s. pension plans were previously frozen . during 2015 , we completed programs to offer lump sums over a limited time to certain former employees in our u.s. pension plans . payments of $ 190 million related to this offer were made from existing plan assets to approximately 7,000 former employees who elected to receive a lump sum . as a result , total lump sum payments from these plans exceeded annual service and interest cost in 2015 ; therefore , we recognized a pre-tax corporate pension settlement charge of $ 137 million in the fourth quarter of 2015. these actions continue to provide stability to our funded status , improve our earnings and operating cash flow , and provide greater transparency to our underlying tire business . story_separator_special_tag other ( income ) expense also included financing fees and financial instruments expense of $ 111 million in 2015 , increasing $ 34 million from $ 77 million in 2014 . financing fees and financial instruments expense consists of the amortization of deferred financing fees , commitment fees and charges incurred in connection with financing transactions . financing fees in 2015 included a charge of $ 57 million ( $ 35 million after-tax and minority ) primarily related to a $ 41 million redemption premium and $ 14 million of expense for the write-off of deferred financing fees and unamortized discount related to the redemption of the $ 1.0 billion 8.25 % senior notes due 2020. other ( income ) expense in 2015 also included net gains on asset sales of $ 71 million ( $ 60 million after-tax and minority ) compared to net gains on asset sales of $ 3 million ( $ 4 million after-tax and minority ) in 2014. net gains on asset sales in 2015 included a net gain of $ 48 million ( $ 38 million after-tax and minority ) related to the dissolution of the global alliance with sri and a gain of $ 30 million ( $ 32 million after-tax and minority ) on the sale of our investment in shares of sri . refer to the note to the consolidated financial statements no . 5 , dissolution of global alliance with sumitomo rubber industries . net gains on asset sales in 2015 also included losses of $ 14 million in emea , primarily related to the sales of certain sub-saharan africa retail businesses . other ( income ) expense in 2015 and 2014 included charges of $ 4 million ( $ 4 million after-tax and minority ) and $ 22 million ( $ 22 million after-tax and minority ) , respectively , for labor claims related to a previously closed facility in greece . other ( income ) expense in 2014 also included charges of $ 16 million ( $ 16 million after-tax and minority ) related to a government investigation involving our compliance with the u.s. foreign corrupt practices act in certain countries in africa . for further information , refer to the note to the consolidated financial statements no . 4 , other ( income ) expense . income taxes income tax expense in 2015 was $ 232 million on income before income taxes of $ 608 million . for 2014 , income tax benefit was $ 1,834 million on income before income taxes of $ 687 million . the increase in income taxes for 2015 compared to 2014 was primarily due to the reversal of the tax valuation allowance on our net u.s. deferred tax assets in the fourth quarter of 2014. income tax expense for 2015 included discrete net tax benefits of $ 18 million ( $ 18 million after minority interest ) , due primarily to a $ 9 million benefit from the conclusion of non-u.s. tax claims and an $ 8 million benefit from the release of a valuation allowance related to u.s. state deferred tax assets . income tax benefit in 2014 was favorably impacted by $ 1,980 million ( $ 1,981 million after minority interest ) of discrete tax adjustments , including a benefit of $ 2,179 million from the december 31 , 2014 release of substantially all of the valuation allowance on our net u.s. deferred tax assets as discussed further below , partially offset by charges of $ 131 million to record deferred taxes on certain undistributed earnings of certain foreign subsidiaries . the 2014 income tax benefit also included charges of $ 37 million to establish valuation allowances on the net deferred tax assets of our venezuelan and brazilian subsidiaries , due to continuing operating losses and currency devaluations in venezuela , a charge of $ 9 million to establish a valuation allowance on the net deferred tax assets of a luxembourg subsidiary , and a charge of $ 11 million due to an enacted law change in chile . in 2015 , in addition to the items noted above , the difference between our effective tax rate and the u.s. statutory rate was primarily due to certain of our foreign subsidiaries continuing to maintain a full valuation allowance against their net deferred tax assets , the realization of $ 55 million of u.s. tax credits as a result of certain subsidiary dividend payments and legislation enacted in the fourth quarter of 2015 and $ 69 million of tax benefits related to the deconsolidation of our venezuelan subsidiary . at december 31 , 2015 , our valuation allowance on certain of our u.s. federal , state and local deferred tax assets was $ 98 million and our valuation allowance on our foreign deferred tax assets was $ 523 million . 27 our losses in various foreign taxing jurisdictions in recent periods represented sufficient negative evidence to require us to maintain a full valuation allowance against certain of our net deferred tax assets . each reporting period we assess available positive and negative evidence and estimate if sufficient future taxable income will be generated to utilize these existing deferred tax assets . if recent positive evidence provided by the profitability in certain emea subsidiaries continues , it will provide us the opportunity to apply greater significance to our forecasts in assessing the need for a valuation allowance . we believe it is reasonably possible that sufficient positive evidence required to release all , or a portion , of these valuation allowances will exist within the next twelve months . this may result in a reduction of the valuation allowance and one-time tax benefit of up to $ 275 million ( $ 275 million after minority interest ) . for further information , refer to the note to the consolidated financial statements no . 6 , income taxes . minority shareholders ' net income minority shareholders ' net income was $ 69

in addition to the energy end-market challenges , we have also incurred significant costs related to manufacturing inefficiencies associated with changes in aerospace customer demand , with the trend toward smaller lot sizes and less consistent order patterns over the past few quarters . while these challenges and endeavors have significantly impacted margins , we believe that the margins in these businesses will moderate to historical levels over time ( and have in packaging , for example , where the innovative molding and arminak & associates acquisitions have been integrated ) as we integrate our acquisitions into our businesses , right-size our facilities and staffing levels to current and expected demand levels and patterns and capitalize on productivity initiatives and volume efficiencies . 29 critical factors affecting our ability to succeed include : our ability to create organic growth through product development , cross selling and extending product-line offerings , and our ability to quickly and cost-effectively introduce new products ; our ability to acquire and integrate companies or products that supplement existing product lines , add new distribution channels , expand our geographic coverage or enable better absorption of overhead costs ; our ability to manage our cost structure more efficiently via supply base management , internal sourcing and or purchasing of materials , selective outsourcing and or purchasing of support functions , working capital management , and greater leverage of our administrative functions . if we are unable to do any of the foregoing successfully , our financial condition and results of operations could be materially and adversely impacted . there is some seasonality in the businesses within our cequent reportable segments , primarily within cequent americas , where sales of towing and trailering products are generally stronger in the second and third quarters , as trailer oems , distributors and retailers acquire product for the spring and summer selling seasons . no other reportable segment experiences significant seasonal fluctuation . we do not consider sales order backlog to be a material factor in our business . a growing portion of our sales is derived from international sources , which exposes us to certain risks , including currency risks . the demand for some of our products , particularly in our two cequent reportable segments , is heavily influenced by consumer sentiment . despite the sales increases in the past few years , we recognize that consumer sentiment and the end market conditions remain unstable , primarily for cequent americas , given continued uncertainties in employment levels and consumer credit availability , both of which significantly impact consumer discretionary spending . we are sensitive to price movements in our raw materials supply base . our largest material purchases are for steel , copper , aluminum , polyethylene and other resins and utility-related inputs . historically , we have experienced increasing costs of steel and resin and have worked with our suppliers to manage cost pressures and disruptions in supply . we also utilize pricing programs to pass increased steel , copper , aluminum and resin costs to customers . although we may experience delays in our ability to implement price increases , we have been generally able to recover such increased costs . we may experience disruptions in supply in the future and may not be able to pass along higher costs associated with such disruptions to our customers in the form of price increases . in addition to the aforementioned price movements in significant raw materials , certain of our businesses are sensitive to oil price movements . our arrow engine business is most directly impacted by significant changes in oil prices . arrow 's pumpjack and other engine sales and related parts , which comprise a significant portion of the business , are impacted by oil drilling levels and commodity pricing . the decline of oil prices in late fourth quarter and into 2015 has significantly impacted demand levels in this business . our other businesses may be impacted by volatile oil prices , but not as directly . for example , a small portion of our energy reportable segment serves upstream customers at oil well sites that may be more quickly impacted by changes in oil prices , while the majority of the segment provides parts for refineries and chemical plants , which may or may not choose to defer capital expenditures or changeover production stock , both of which would require retooling with our gaskets and bolts , in times of fluctuations in oil prices . our packaging reportable segment may be impacted by oil prices , as it is a significant driver of resin pricing , although we generally are able to maintain profit levels when oil prices change due to escalator/de-escalator clauses in contracts with many of our customers . lastly , our cequent businesses rely on consumer discretionary spending levels and confidence , which may be impacted when oil and gasoline prices are volatile . we report shipping and handling expenses associated with our cequent americas reportable segment 's distribution network as an element of selling , general and administrative expenses in our consolidated statement of income . as such , gross margins for the cequent americas reportable segment may not be comparable to those of our other reportable segments , which primarily rely on third party distributors , for which all costs are included in cost of sales . 30 segment information and supplemental analysis the following table summarizes financial information for our six reportable segments : replace_table_token_4_th 31 replace_table_token_5_th results of operations year ended december 31 , 2014 compared with year ended december 31 , 2013 the principal factors impacting us during the year ended december 31 , 2014 , compared with the year ended december 31 , 2013 were : the impact of our various acquisitions during 2014 and 2013 ( see below for the impact by reportable segment ) ; business unit restructuring within our energy reportable segment , under which we incurred approximately $ 13.2 million story_separator_special_tag selling , general and administrative costs increased in our legacy aerospace business , primarily due to an approximately $ 1.1 million charge for resolution of a customer claim . in addition , we incurred approximately $ 0.7 million in additional employee related costs in 2014 associated with changes in leadership . operating profit within aerospace decreased approximately $ 5.0 million to $ 17.8 million , or 14.7 % of sales , in 2014 , as compared to $ 22.8 million , or 23.9 % of sales , in 2013 , primarily due to manufacturing and labor inefficiencies , a less favorable product sales mix , lower profit margins associated with our recent acquisitions and higher selling , general and administrative expenses in support of our growth initiatives , which more than offset the impact of higher sales levels . engineered components . net sales in 2014 increased approximately $ 36.0 million , or 19.4 % , to $ 221.4 million , as compared to $ 185.4 million in 2013 . sales in our industrial cylinder business increased by approximately $ 26.0 million , due primarily to approximately $ 17.0 million in sales being generated from our november 2013 cylinder asset acquisition , as well as continued growth projects related to both new product sales of fire suppressant and aviation cylinders , and growth in our mexico and south america markets . sales in our engine business increased approximately $ 10.0 million , with approximately $ 5.6 million of the increase related to a large order for compressor packages by a significant customer in the first quarter of 2014. in addition , sales increased in our gas compression products by approximately $ 7.2 million resulting from both growth in our existing customer base and new customers . these increases were partially offset by an approximate $ 2.9 million decrease in our slow speed and compressor engine and related products business , primarily due to a reduced demand of our single cylinder engines and the impact of falling oil prices in late 2014. gross profit within engineered components increased approximately $ 15.1 million to $ 48.4 million , or 21.9 % of sales , in 2014 , from $ 33.3 million , or 18.0 % of sales , in 2013 , primarily due to margin improvement , as well as higher sales levels in both of our industrial cylinder and engine businesses . gross profit margin in our engine business increased , as the lower fixed cost absorption we experienced during the third quarter of 2013 , primarily a result of lower production and procurement levels , did not recur in 2014 , and as a result of a more favorable product sales mix and continued productivity initiatives . gross profit margin in our industrial cylinder business remained flat , as increased gross profit margin due to continued productivity initiatives and operating leverage gained on the recent cylinder asset acquisition was offset by a less favorable product sales mix . selling , general and administrative expenses increased approximately $ 0.6 million to $ 14.2 million , or 6.4 % of sales , in 2014 , as compared to $ 13.6 million , or 7.3 % of sales , in 2013 , as a result of the increased sales in both our engine and industrial cylinder businesses , with lower selling , general and administrative expenses as a percent of sales as a result of additional operating leverage gained on the higher sales levels , primarily in our engine business , as well as reduced legal fees in our industrial cylinder business , which was partially offset by increased amortization of the intangible assets associated with the fourth quarter 2013 cylinder asset acquisition . 35 operating profit within engineered components increased approximately $ 14.6 million to $ 34.1 million , or 15.4 % of sales , in 2014 , as compared to $ 19.5 million , or 10.5 % of sales , in 2013 , primarily due to the increased sales levels , with margin improvement resulting from improved fixed cost absorption in our engine business , continued productivity and cost reduction initiatives , as well as the additional operating leverage gained on selling , general and administrative expenses . cequent apea . net sales increased approximately $ 13.5 million , or 8.9 % , to $ 165.1 million in 2014 , as compared to $ 151.6 million in 2013 . sales increased approximately $ 22.6 million as a result of the incremental sales associated with the acquisitions of c.p . witter limited ( `` witter `` ) , in april 2013 , and the towing technology and associated assets of al-ko , in july 2013. in addition , sales increased due to both additional market share gains and new products in both our south africa and new zealand businesses . the increase was partially offset by relatively equal declines in thailand and australia . the declines in australia were related to general economic conditions resulting in reduced consumer and business confidence , lower sales in thailand related to the loss of an oem product line contract and the unfavorable impact of currency exchange of approximately $ 6.0 million , as our reported results in u.s. dollars were negatively impacted as a result of the stronger u.s. dollar relative to foreign currencies . cequent apea 's gross profit increased approximately $ 0.6 million to $ 31.4 million , or 19.0 % of net sales in 2014 , from approximately $ 30.8 million , or 20.3 % of net sales , in 2013 , primarily due to higher sales levels and the impact of approximately $ 1.2 million of purchase accounting-related adjustments recorded during 2013 related to the step-up in value and subsequent amortization of inventory in connection with our european acquisitions that did not recur . gross profit margin decreased due to a less favorable product and regional sales mix , as sales growth in the recently acquired european businesses and the growth

cash provided by operating activities in 2014 was approximately $ 123.4 million , as compared to $ 87.6 million in 2013 . significant changes in cash flows provided by operating activities and the reasons for such changes are as follows : in 2014 , the company generated $ 124.7 million in cash flows , based on the reported net income of $ 69.3 million and after considering the effects of non-cash items related to gains on dispositions of businesses and other assets , depreciation , amortization , stock compensation and related changes in excess tax benefits , changes in deferred income taxes , debt financing and extinguishment costs and other , net . in 2013 , the company generated $ 118.5 million based on the reported net income of $ 80.1 million and after considering the effects of similar non-cash items . increases in accounts receivable resulted in a use of cash of approximately $ 13.3 million and $ 25.6 million in 2014 and 2013 , respectively . the increase in accounts receivable is due primarily to the increase in year-over-year sales and the timing of sales and collection of cash within the period . our days sales outstanding of receivables remained relatively flat year-over-year . 42 we used approximately $ 7.5 million and $ 10.7 million of cash in 2014 and 2013 , respectively , for investment in our inventories . inventory levels increased primarily to support the increased sales volumes . while our gross inventory levels are higher in 2014 than in 2013 , our days sales of inventory have remained relatively flat , as we have not needed to make significant investment in additional inventory in 2014 , despite the 8.0 % increase in sales year-over-year .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```cash provided by operating activities in 2014 was approximately $ 123.4 million , as compared to $ 87.6 million in 2013 . significant changes in cash flows provided by operating activities and the reasons for such changes are as follows : in 2014 , the company generated $ 124.7 million in cash flows , based on the reported net income of $ 69.3 million and after considering the effects of non-cash items related to gains on dispositions of businesses and other assets , depreciation , amortization , stock compensation and related changes in excess tax benefits , changes in deferred income taxes , debt financing and extinguishment costs and other , net . in 2013 , the company generated $ 118.5 million based on the reported net income of $ 80.1 million and after considering the effects of similar non-cash items . increases in accounts receivable resulted in a use of cash of approximately $ 13.3 million and $ 25.6 million in 2014 and 2013 , respectively . the increase in accounts receivable is due primarily to the increase in year-over-year sales and the timing of sales and collection of cash within the period . our days sales outstanding of receivables remained relatively flat year-over-year . 42 we used approximately $ 7.5 million and $ 10.7 million of cash in 2014 and 2013 , respectively , for investment in our inventories . inventory levels increased primarily to support the increased sales volumes . while our gross inventory levels are higher in 2014 than in 2013 , our days sales of inventory have remained relatively flat , as we have not needed to make significant investment in additional inventory in 2014 , despite the 8.0 % increase in sales year-over-year . ``` Suspicious Activity Report : in addition to the energy end-market challenges , we have also incurred significant costs related to manufacturing inefficiencies associated with changes in aerospace customer demand , with the trend toward smaller lot sizes and less consistent order patterns over the past few quarters . while these challenges and endeavors have significantly impacted margins , we believe that the margins in these businesses will moderate to historical levels over time ( and have in packaging , for example , where the innovative molding and arminak & associates acquisitions have been integrated ) as we integrate our acquisitions into our businesses , right-size our facilities and staffing levels to current and expected demand levels and patterns and capitalize on productivity initiatives and volume efficiencies . 29 critical factors affecting our ability to succeed include : our ability to create organic growth through product development , cross selling and extending product-line offerings , and our ability to quickly and cost-effectively introduce new products ; our ability to acquire and integrate companies or products that supplement existing product lines , add new distribution channels , expand our geographic coverage or enable better absorption of overhead costs ; our ability to manage our cost structure more efficiently via supply base management , internal sourcing and or purchasing of materials , selective outsourcing and or purchasing of support functions , working capital management , and greater leverage of our administrative functions . if we are unable to do any of the foregoing successfully , our financial condition and results of operations could be materially and adversely impacted . there is some seasonality in the businesses within our cequent reportable segments , primarily within cequent americas , where sales of towing and trailering products are generally stronger in the second and third quarters , as trailer oems , distributors and retailers acquire product for the spring and summer selling seasons . no other reportable segment experiences significant seasonal fluctuation . we do not consider sales order backlog to be a material factor in our business . a growing portion of our sales is derived from international sources , which exposes us to certain risks , including currency risks . the demand for some of our products , particularly in our two cequent reportable segments , is heavily influenced by consumer sentiment . despite the sales increases in the past few years , we recognize that consumer sentiment and the end market conditions remain unstable , primarily for cequent americas , given continued uncertainties in employment levels and consumer credit availability , both of which significantly impact consumer discretionary spending . we are sensitive to price movements in our raw materials supply base . our largest material purchases are for steel , copper , aluminum , polyethylene and other resins and utility-related inputs . historically , we have experienced increasing costs of steel and resin and have worked with our suppliers to manage cost pressures and disruptions in supply . we also utilize pricing programs to pass increased steel , copper , aluminum and resin costs to customers . although we may experience delays in our ability to implement price increases , we have been generally able to recover such increased costs . we may experience disruptions in supply in the future and may not be able to pass along higher costs associated with such disruptions to our customers in the form of price increases . in addition to the aforementioned price movements in significant raw materials , certain of our businesses are sensitive to oil price movements . our arrow engine business is most directly impacted by significant changes in oil prices . arrow 's pumpjack and other engine sales and related parts , which comprise a significant portion of the business , are impacted by oil drilling levels and commodity pricing . the decline of oil prices in late fourth quarter and into 2015 has significantly impacted demand levels in this business . our other businesses may be impacted by volatile oil prices , but not as directly . for example , a small portion of our energy reportable segment serves upstream customers at oil well sites that may be more quickly impacted by changes in oil prices , while the majority of the segment provides parts for refineries and chemical plants , which may or may not choose to defer capital expenditures or changeover production stock , both of which would require retooling with our gaskets and bolts , in times of fluctuations in oil prices . our packaging reportable segment may be impacted by oil prices , as it is a significant driver of resin pricing , although we generally are able to maintain profit levels when oil prices change due to escalator/de-escalator clauses in contracts with many of our customers . lastly , our cequent businesses rely on consumer discretionary spending levels and confidence , which may be impacted when oil and gasoline prices are volatile . we report shipping and handling expenses associated with our cequent americas reportable segment 's distribution network as an element of selling , general and administrative expenses in our consolidated statement of income . as such , gross margins for the cequent americas reportable segment may not be comparable to those of our other reportable segments , which primarily rely on third party distributors , for which all costs are included in cost of sales . 30 segment information and supplemental analysis the following table summarizes financial information for our six reportable segments : replace_table_token_4_th 31 replace_table_token_5_th results of operations year ended december 31 , 2014 compared with year ended december 31 , 2013 the principal factors impacting us during the year ended december 31 , 2014 , compared with the year ended december 31 , 2013 were : the impact of our various acquisitions during 2014 and 2013 ( see below for the impact by reportable segment ) ; business unit restructuring within our energy reportable segment , under which we incurred approximately $ 13.2 million story_separator_special_tag selling , general and administrative costs increased in our legacy aerospace business , primarily due to an approximately $ 1.1 million charge for resolution of a customer claim . in addition , we incurred approximately $ 0.7 million in additional employee related costs in 2014 associated with changes in leadership . operating profit within aerospace decreased approximately $ 5.0 million to $ 17.8 million , or 14.7 % of sales , in 2014 , as compared to $ 22.8 million , or 23.9 % of sales , in 2013 , primarily due to manufacturing and labor inefficiencies , a less favorable product sales mix , lower profit margins associated with our recent acquisitions and higher selling , general and administrative expenses in support of our growth initiatives , which more than offset the impact of higher sales levels . engineered components . net sales in 2014 increased approximately $ 36.0 million , or 19.4 % , to $ 221.4 million , as compared to $ 185.4 million in 2013 . sales in our industrial cylinder business increased by approximately $ 26.0 million , due primarily to approximately $ 17.0 million in sales being generated from our november 2013 cylinder asset acquisition , as well as continued growth projects related to both new product sales of fire suppressant and aviation cylinders , and growth in our mexico and south america markets . sales in our engine business increased approximately $ 10.0 million , with approximately $ 5.6 million of the increase related to a large order for compressor packages by a significant customer in the first quarter of 2014. in addition , sales increased in our gas compression products by approximately $ 7.2 million resulting from both growth in our existing customer base and new customers . these increases were partially offset by an approximate $ 2.9 million decrease in our slow speed and compressor engine and related products business , primarily due to a reduced demand of our single cylinder engines and the impact of falling oil prices in late 2014. gross profit within engineered components increased approximately $ 15.1 million to $ 48.4 million , or 21.9 % of sales , in 2014 , from $ 33.3 million , or 18.0 % of sales , in 2013 , primarily due to margin improvement , as well as higher sales levels in both of our industrial cylinder and engine businesses . gross profit margin in our engine business increased , as the lower fixed cost absorption we experienced during the third quarter of 2013 , primarily a result of lower production and procurement levels , did not recur in 2014 , and as a result of a more favorable product sales mix and continued productivity initiatives . gross profit margin in our industrial cylinder business remained flat , as increased gross profit margin due to continued productivity initiatives and operating leverage gained on the recent cylinder asset acquisition was offset by a less favorable product sales mix . selling , general and administrative expenses increased approximately $ 0.6 million to $ 14.2 million , or 6.4 % of sales , in 2014 , as compared to $ 13.6 million , or 7.3 % of sales , in 2013 , as a result of the increased sales in both our engine and industrial cylinder businesses , with lower selling , general and administrative expenses as a percent of sales as a result of additional operating leverage gained on the higher sales levels , primarily in our engine business , as well as reduced legal fees in our industrial cylinder business , which was partially offset by increased amortization of the intangible assets associated with the fourth quarter 2013 cylinder asset acquisition . 35 operating profit within engineered components increased approximately $ 14.6 million to $ 34.1 million , or 15.4 % of sales , in 2014 , as compared to $ 19.5 million , or 10.5 % of sales , in 2013 , primarily due to the increased sales levels , with margin improvement resulting from improved fixed cost absorption in our engine business , continued productivity and cost reduction initiatives , as well as the additional operating leverage gained on selling , general and administrative expenses . cequent apea . net sales increased approximately $ 13.5 million , or 8.9 % , to $ 165.1 million in 2014 , as compared to $ 151.6 million in 2013 . sales increased approximately $ 22.6 million as a result of the incremental sales associated with the acquisitions of c.p . witter limited ( `` witter `` ) , in april 2013 , and the towing technology and associated assets of al-ko , in july 2013. in addition , sales increased due to both additional market share gains and new products in both our south africa and new zealand businesses . the increase was partially offset by relatively equal declines in thailand and australia . the declines in australia were related to general economic conditions resulting in reduced consumer and business confidence , lower sales in thailand related to the loss of an oem product line contract and the unfavorable impact of currency exchange of approximately $ 6.0 million , as our reported results in u.s. dollars were negatively impacted as a result of the stronger u.s. dollar relative to foreign currencies . cequent apea 's gross profit increased approximately $ 0.6 million to $ 31.4 million , or 19.0 % of net sales in 2014 , from approximately $ 30.8 million , or 20.3 % of net sales , in 2013 , primarily due to higher sales levels and the impact of approximately $ 1.2 million of purchase accounting-related adjustments recorded during 2013 related to the step-up in value and subsequent amortization of inventory in connection with our european acquisitions that did not recur . gross profit margin decreased due to a less favorable product and regional sales mix , as sales growth in the recently acquired european businesses and the growth

for long-lived assets to be held and used , we base our evaluation on impairment indicators such as the nature of the assets , the future economic benefits of the assets , any historical or future profitability measurements and other external market conditions or factors that may be present . if such impairment indicators are present or other factors exist that indicate that the carrying amount of an asset may not be recoverable , we determine whether an impairment has occurred through the use of an undiscounted cash flows analysis of the asset at the lowest level for which identifiable cash flows exist . if an impairment has occurred , we recognize a loss for the difference between the carrying amount and the fair value of the asset . for assets held for sale or disposal , the fair value of the asset is measured using fair market value less cost to sell . assets are classified as held-for-sale when we have a plan for disposal of certain assets and those assets meet the held for sale criteria . we charge the costs of repair and maintenance of property and equipment to operations as incurred , while we capitalize the costs of improvements that extend asset lives or functionality . goodwill . in our annual evaluation of goodwill for impairment , we first assess qualitative factors to determine whether the existence of events or circumstances leads to a determination that it is more likely than not that the fair value of a reporting unit is less than its carrying amount . if , after assessing the totality of events or circumstances , we determine it is more likely than not that the fair value of a reporting unit exceeds its carrying amount , performing the two-step impairment test is unnecessary . however , if we conclude otherwise , then we are required to perform the first step of the two-step impairment test . we estimate fair value of the reporting units using both an income approach , which considers a discounted cash flow model , and a market approach . reductions in estimates of our future cash flows or adverse changes in market comparable information may result in goodwill impairments in the future . for reporting units with goodwill , we do not believe our goodwill will be impaired during 2017 . income taxes . our tax provisions are based on our expected taxable income , statutory rates and tax-planning opportunities available to us in the various jurisdictions in which we operate . determination of taxable income in any jurisdiction requires the interpretation of the related tax laws . we are at risk that a taxing authority 's final determination of our tax liabilities may differ from our interpretation . our effective tax rate may fluctuate from year to year as our operations are conducted in different taxing jurisdictions , the amount of pre-tax income fluctuates , the amounts of foreign income we anticipate will be repatriated and our estimates regarding the realizability of items such as foreign tax credits may change . we consider $ 623 million of unremitted earnings of our foreign subsidiaries to be indefinitely reinvested . we believe we have the ability to indefinitely reinvest these foreign earnings based on our expectations of profitability for our u.s. operations over the long term , our significant u.s. liquidity , and the amount of unremitted earnings of our foreign subsidiaries not considered indefinitely reinvested , for which we have provided deferred income taxes . we account for any applicable interest and penalties on uncertain tax positions as a component of our provision for income taxes on our financial statements . current income tax expense represents either nonresident withholding taxes or the liabilities expected to be reflected on our income tax returns for the current year , while the net deferred income tax expense or benefit represents the change in the balance of deferred tax assets or liabilities as reported on our balance sheet . we establish valuation allowances to reduce deferred tax assets when it is more likely than not that some portion or all of the deferred tax assets will not be realized in the future . while we have considered estimated future taxable income and ongoing prudent and feasible tax-planning strategies in assessing the need for the valuation allowances , changes in these estimates and assumptions , as well as changes in tax laws , could require us to provide for valuation allowances for our deferred tax assets . provisions for valuation allowances impact our income tax provision in the period in which such adjustments are identified and recorded . we established a deferred tax asset valuation allowance of $ 4.2 million in 2016 related to the realizability of loss carryforwards in certain of our foreign jurisdictions . 30 in march 2016 , the fasb issued asu 2016-09 , `` compensation – stock compensation improvements to employee share-based payment accounting . `` this update requires that all excess tax benefits and tax deficiencies ( including tax benefits of dividends on share-based payment awards ) should be recognized as income tax expense or benefit in the income statement . the tax effects of exercised or vested awards should be treated as discrete items in the reporting period in which they occur . an entity also should recognize excess tax benefits regardless of whether the benefit reduces taxes payable in the current period . currently , an entity must determine , for each award , whether the difference between the deduction for tax purposes and the compensation cost recognized for financial reporting purposes results in either an excess tax benefit or a tax deficiency . story_separator_special_tag the december 2014 program calls for the repurchases to be made in the open market , or in privately negotiated transactions from time to time , in compliance with applicable laws , rules and regulations , including rule 10b-18 under the securities exchange act of 1934 , as amended , subject to market and business conditions , levels of available liquidity , cash requirements for other purposes , applicable legal requirements and other relevant factors . the timing and amount of any repurchases will be determined by our management based on its evaluation of these factors . we expect that any shares repurchased under the new program will be held as treasury stock for future possible use . the new program does not obligate us to repurchase any particular number of shares . through december 31 , 2015 under the new program , we repurchased 2 million shares of our common stock for $ 100 million . we did not repurchase any shares in 2016 . as of december 31 , 2016 , we retained 12.8 million of the shares we had repurchased . we expect to hold the shares repurchased for future use . because of our significant foreign operations , we are exposed to currency fluctuations and exchange rate risks . we generally minimize these risks primarily through matching , to the extent possible , revenue and expense in the various currencies in which we operate . cumulative translation adjustments as of december 31 , 2016 relate primarily to our net investments in , including long-term loans to , our foreign subsidiaries . a stronger u.s. dollar against the u.k. pound sterling , norwegian kroner and brazilian real would result in lower operating income . see item 7a – `` quantitative and qualitative disclosures about market risk . `` 34 results of operations additional information on our business segments is shown in note 7 of the notes to consolidated financial statements included in this report . oilfield . the table that follows sets out revenue and profitability for the business segments within our oilfield business . in the rov section of the table that follows , `` days available `` includes all days from the first day that an rov is placed in service until the rov is retired . all days in this period are considered available days , including periods when an rov is undergoing maintenance or repairs . our rovs do not have scheduled maintenance or repair that requires significant time when the rovs are not available for utilization . replace_table_token_12_th 35 historically , we built new rovs to increase the size of our fleet in response to demand to support deepwater drilling and vessel-based inspection , maintenance and repair ( `` imr `` ) and installation work . in 2015 , as a result of declining market conditions , we began building fewer rovs , primarily to meet contractual commitments . these vehicles are designed for use around the world in water depths of 10,000 feet or more . we added 6 , 16 and 49 rovs in 2016 , 2015 and 2014 , respectively , while retiring 94 units over the three-year period and transferring one to our advanced technologies segment over that period . our rov fleet size was 280 at december 31 , 2016 , 315 at december 31 , 2015 and 336 at december 31 , 2014 . we have decreased our rov fleet size over the last two years as a result of lower market demand . our rov operating income decreased in the year ended december 31 , 2016 compared to the prior year , as a result of lower days on hire and lower average revenue per day-on-hire , as well as inventory write-downs and fixed asset write-offs totaling $ 36.0 million in 2016. during 2016 , the leading indicator for deepwater activity , contracted floating rigs , continued to decline as the rate of rigs being idled , either by contract termination or expiration , continued . this prevailing market condition required us to reassess the number of rovs we had in our fleet , as well as the associated inventory . as a result of our reassessment , in 2016 we recorded $ 36.0 million of charges consisting of : ( 1 ) $ 25.2 million for a reserve for excess inventory ; and ( 2 ) $ 10.8 million for the retirement of 39 rovs . during 2016 we also incurred charges related to restructuring expenses of $ 3.8 million and bad debt expenses of $ 1.2 million . for 2015 , our rov revenue and operating income declined from 2014 from lower demand for drill support services and a reduction in average revenue per day across all our geographic areas of operation . rov days on hire decreased by 15 % and revenue per day on hire decreased 11 % . in 2015 , our rov cost of services and products included inventory write-downs of $ 15.7 million , restructuring expenses of $ 7.2 million and rov retirements resulting in write-offs of $ 2.9 million . the inventory write downs were due to excess inventory , which we do not anticipate using given current and forecast market conditions . the restructuring expenses related to severance costs for incurred and designated future workforce reductions and costs associated with closing excess facilities . the write-offs were necessitated as a result of our retiring an unusually large number of rovs in 2015 due to market prospects for these vehicles . in our financial statements , the charges incurred in both 2016 and 2015 are reflected in our cost of services and products , except for the charges related to bad debts , which are reflected in general and administrative expenses . we anticipate rov operating income to decrease in 2017 as a result of decreases in average revenue per day on hire and the number of days on hire for drilling support services , attributable to

liquidity and capital resources we consider our liquidity and capital resources adequate to support our operations and growth initiatives . at december 31 , 2016 , we had working capital of $ 754 million , including cash and cash equivalents of $ 450 million . additionally , we had $ 500 million available through our revolving credit facility under a credit agreement ( as amended , the `` credit agreement '' ) , which is scheduled to expire on october 25 , 2021 . in october 2014 , we entered into the credit agreement with a group of banks to replace our prior principal credit agreement . the credit agreement provides for a $ 300 million three-year term loan ( the `` term loan facility '' ) and a $ 500 million five-year revolving credit facility ( the `` revolving credit facility '' ) . subject to certain conditions , the aggregate commitments under the revolving credit facility may be increased to up to $ 800 million at any time upon agreement between us and existing or additional lenders . borrowings under the revolving credit facility and the term loan facility may be used for general corporate purposes . simultaneously with the execution of the credit agreement and pursuant to its terms , we repaid all amounts outstanding under , and terminated , the prior credit agreement . in november 2015 , we entered into an agreement and amendment no . 1 to credit agreement ( `` amendment no . 1 '' ) . amendment no . 1 amended the credit agreement to ( 1 ) replace the maximum leverage ratio financial covenant with a new financial covenant restricting the maximum total capitalization ratio ( defined in amendment no .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```liquidity and capital resources we consider our liquidity and capital resources adequate to support our operations and growth initiatives . at december 31 , 2016 , we had working capital of $ 754 million , including cash and cash equivalents of $ 450 million . additionally , we had $ 500 million available through our revolving credit facility under a credit agreement ( as amended , the `` credit agreement '' ) , which is scheduled to expire on october 25 , 2021 . in october 2014 , we entered into the credit agreement with a group of banks to replace our prior principal credit agreement . the credit agreement provides for a $ 300 million three-year term loan ( the `` term loan facility '' ) and a $ 500 million five-year revolving credit facility ( the `` revolving credit facility '' ) . subject to certain conditions , the aggregate commitments under the revolving credit facility may be increased to up to $ 800 million at any time upon agreement between us and existing or additional lenders . borrowings under the revolving credit facility and the term loan facility may be used for general corporate purposes . simultaneously with the execution of the credit agreement and pursuant to its terms , we repaid all amounts outstanding under , and terminated , the prior credit agreement . in november 2015 , we entered into an agreement and amendment no . 1 to credit agreement ( `` amendment no . 1 '' ) . amendment no . 1 amended the credit agreement to ( 1 ) replace the maximum leverage ratio financial covenant with a new financial covenant restricting the maximum total capitalization ratio ( defined in amendment no . ``` Suspicious Activity Report : for long-lived assets to be held and used , we base our evaluation on impairment indicators such as the nature of the assets , the future economic benefits of the assets , any historical or future profitability measurements and other external market conditions or factors that may be present . if such impairment indicators are present or other factors exist that indicate that the carrying amount of an asset may not be recoverable , we determine whether an impairment has occurred through the use of an undiscounted cash flows analysis of the asset at the lowest level for which identifiable cash flows exist . if an impairment has occurred , we recognize a loss for the difference between the carrying amount and the fair value of the asset . for assets held for sale or disposal , the fair value of the asset is measured using fair market value less cost to sell . assets are classified as held-for-sale when we have a plan for disposal of certain assets and those assets meet the held for sale criteria . we charge the costs of repair and maintenance of property and equipment to operations as incurred , while we capitalize the costs of improvements that extend asset lives or functionality . goodwill . in our annual evaluation of goodwill for impairment , we first assess qualitative factors to determine whether the existence of events or circumstances leads to a determination that it is more likely than not that the fair value of a reporting unit is less than its carrying amount . if , after assessing the totality of events or circumstances , we determine it is more likely than not that the fair value of a reporting unit exceeds its carrying amount , performing the two-step impairment test is unnecessary . however , if we conclude otherwise , then we are required to perform the first step of the two-step impairment test . we estimate fair value of the reporting units using both an income approach , which considers a discounted cash flow model , and a market approach . reductions in estimates of our future cash flows or adverse changes in market comparable information may result in goodwill impairments in the future . for reporting units with goodwill , we do not believe our goodwill will be impaired during 2017 . income taxes . our tax provisions are based on our expected taxable income , statutory rates and tax-planning opportunities available to us in the various jurisdictions in which we operate . determination of taxable income in any jurisdiction requires the interpretation of the related tax laws . we are at risk that a taxing authority 's final determination of our tax liabilities may differ from our interpretation . our effective tax rate may fluctuate from year to year as our operations are conducted in different taxing jurisdictions , the amount of pre-tax income fluctuates , the amounts of foreign income we anticipate will be repatriated and our estimates regarding the realizability of items such as foreign tax credits may change . we consider $ 623 million of unremitted earnings of our foreign subsidiaries to be indefinitely reinvested . we believe we have the ability to indefinitely reinvest these foreign earnings based on our expectations of profitability for our u.s. operations over the long term , our significant u.s. liquidity , and the amount of unremitted earnings of our foreign subsidiaries not considered indefinitely reinvested , for which we have provided deferred income taxes . we account for any applicable interest and penalties on uncertain tax positions as a component of our provision for income taxes on our financial statements . current income tax expense represents either nonresident withholding taxes or the liabilities expected to be reflected on our income tax returns for the current year , while the net deferred income tax expense or benefit represents the change in the balance of deferred tax assets or liabilities as reported on our balance sheet . we establish valuation allowances to reduce deferred tax assets when it is more likely than not that some portion or all of the deferred tax assets will not be realized in the future . while we have considered estimated future taxable income and ongoing prudent and feasible tax-planning strategies in assessing the need for the valuation allowances , changes in these estimates and assumptions , as well as changes in tax laws , could require us to provide for valuation allowances for our deferred tax assets . provisions for valuation allowances impact our income tax provision in the period in which such adjustments are identified and recorded . we established a deferred tax asset valuation allowance of $ 4.2 million in 2016 related to the realizability of loss carryforwards in certain of our foreign jurisdictions . 30 in march 2016 , the fasb issued asu 2016-09 , `` compensation – stock compensation improvements to employee share-based payment accounting . `` this update requires that all excess tax benefits and tax deficiencies ( including tax benefits of dividends on share-based payment awards ) should be recognized as income tax expense or benefit in the income statement . the tax effects of exercised or vested awards should be treated as discrete items in the reporting period in which they occur . an entity also should recognize excess tax benefits regardless of whether the benefit reduces taxes payable in the current period . currently , an entity must determine , for each award , whether the difference between the deduction for tax purposes and the compensation cost recognized for financial reporting purposes results in either an excess tax benefit or a tax deficiency . story_separator_special_tag the december 2014 program calls for the repurchases to be made in the open market , or in privately negotiated transactions from time to time , in compliance with applicable laws , rules and regulations , including rule 10b-18 under the securities exchange act of 1934 , as amended , subject to market and business conditions , levels of available liquidity , cash requirements for other purposes , applicable legal requirements and other relevant factors . the timing and amount of any repurchases will be determined by our management based on its evaluation of these factors . we expect that any shares repurchased under the new program will be held as treasury stock for future possible use . the new program does not obligate us to repurchase any particular number of shares . through december 31 , 2015 under the new program , we repurchased 2 million shares of our common stock for $ 100 million . we did not repurchase any shares in 2016 . as of december 31 , 2016 , we retained 12.8 million of the shares we had repurchased . we expect to hold the shares repurchased for future use . because of our significant foreign operations , we are exposed to currency fluctuations and exchange rate risks . we generally minimize these risks primarily through matching , to the extent possible , revenue and expense in the various currencies in which we operate . cumulative translation adjustments as of december 31 , 2016 relate primarily to our net investments in , including long-term loans to , our foreign subsidiaries . a stronger u.s. dollar against the u.k. pound sterling , norwegian kroner and brazilian real would result in lower operating income . see item 7a – `` quantitative and qualitative disclosures about market risk . `` 34 results of operations additional information on our business segments is shown in note 7 of the notes to consolidated financial statements included in this report . oilfield . the table that follows sets out revenue and profitability for the business segments within our oilfield business . in the rov section of the table that follows , `` days available `` includes all days from the first day that an rov is placed in service until the rov is retired . all days in this period are considered available days , including periods when an rov is undergoing maintenance or repairs . our rovs do not have scheduled maintenance or repair that requires significant time when the rovs are not available for utilization . replace_table_token_12_th 35 historically , we built new rovs to increase the size of our fleet in response to demand to support deepwater drilling and vessel-based inspection , maintenance and repair ( `` imr `` ) and installation work . in 2015 , as a result of declining market conditions , we began building fewer rovs , primarily to meet contractual commitments . these vehicles are designed for use around the world in water depths of 10,000 feet or more . we added 6 , 16 and 49 rovs in 2016 , 2015 and 2014 , respectively , while retiring 94 units over the three-year period and transferring one to our advanced technologies segment over that period . our rov fleet size was 280 at december 31 , 2016 , 315 at december 31 , 2015 and 336 at december 31 , 2014 . we have decreased our rov fleet size over the last two years as a result of lower market demand . our rov operating income decreased in the year ended december 31 , 2016 compared to the prior year , as a result of lower days on hire and lower average revenue per day-on-hire , as well as inventory write-downs and fixed asset write-offs totaling $ 36.0 million in 2016. during 2016 , the leading indicator for deepwater activity , contracted floating rigs , continued to decline as the rate of rigs being idled , either by contract termination or expiration , continued . this prevailing market condition required us to reassess the number of rovs we had in our fleet , as well as the associated inventory . as a result of our reassessment , in 2016 we recorded $ 36.0 million of charges consisting of : ( 1 ) $ 25.2 million for a reserve for excess inventory ; and ( 2 ) $ 10.8 million for the retirement of 39 rovs . during 2016 we also incurred charges related to restructuring expenses of $ 3.8 million and bad debt expenses of $ 1.2 million . for 2015 , our rov revenue and operating income declined from 2014 from lower demand for drill support services and a reduction in average revenue per day across all our geographic areas of operation . rov days on hire decreased by 15 % and revenue per day on hire decreased 11 % . in 2015 , our rov cost of services and products included inventory write-downs of $ 15.7 million , restructuring expenses of $ 7.2 million and rov retirements resulting in write-offs of $ 2.9 million . the inventory write downs were due to excess inventory , which we do not anticipate using given current and forecast market conditions . the restructuring expenses related to severance costs for incurred and designated future workforce reductions and costs associated with closing excess facilities . the write-offs were necessitated as a result of our retiring an unusually large number of rovs in 2015 due to market prospects for these vehicles . in our financial statements , the charges incurred in both 2016 and 2015 are reflected in our cost of services and products , except for the charges related to bad debts , which are reflected in general and administrative expenses . we anticipate rov operating income to decrease in 2017 as a result of decreases in average revenue per day on hire and the number of days on hire for drilling support services , attributable to

we expect to drive continued earnings growth through ongoing revenue growth coupled with margin expansion , which we expect to achieve through efficiencies in our implementation and operational processes and by leveraging r & d investments and controlling general and administrative expenses . we are also focused on continuing to deliver strong levels of cash flow , which we expect to do by continuing to grow earnings and prudently managing capital expenditures . siemens health services on february 2 , 2015 , we acquired substantially all of the assets , and assumed certain liabilities of siemens ag 's health information technology business unit , siemens health services , as further described in note ( 2 ) of the notes to consolidated financial statements . the acquired business ( now referred to as `` cerner health services `` ) offers a portfolio of enterprise-level clinical and financial health care information technology solutions , as well as departmental , connectivity , population health , and care coordination solutions globally . solutions are offered on the soarian , invision , and i.s.h.med platforms , among others . cerner health services also offers a range of complementary services including support , hosting , managed services , implementation services , and strategic consulting . we believe the acquisition enhances our organic growth opportunities as it provides us a larger base into which we can sell our combined portfolio of solutions and services . the acquisition also augments our non-u.s. footprint and growth opportunities , increases our scale for r & d investment , and adds over 5,000 highly-skilled associates that will enhance our capabilities . 25 the addition of this business has a significant impact on the comparability of our 2015 consolidated financial statements in relation to the comparative periods presented herein . results overview the company delivered strong levels of bookings , revenues , earnings and operating cash flows in 2015 . new business bookings revenue in 2015 , which reflects the value of executed contracts for software , hardware , professional services and managed services , was $ 5.4 billion , which is an increase of 28 % compared to $ 4.3 billion in 2014 . revenues for 2015 increased 30 % to $ 4.4 billion compared to $ 3.4 billion in 2014 . our fiscal year 2015 revenues include approximately $ 930 million attributable to the acquired cerner health services business . the remaining year-over-year increase in revenue reflects ongoing demand for cerner 's core solutions and services driven by our clients ' needs to keep up with regulatory requirements ; contributions from cerner itworks and revenue cycle solutions and services ; and attaining new clients . our 2015 net earnings were $ 539 million compared to $ 525 million in 2014 . diluted earnings per share were $ 1.54 in 2015 compared to $ 1.50 in 2014 . disclosure of the earnings contribution from the cerner health services business is not practicable , as we have already integrated operations in many areas . the overall increase in net earnings and diluted earnings per share was primarily a result of increased revenues , partially offset by elevated operating expenses , which included costs associated with the acquisition and integration of the cerner health services business , and our voluntary separation plan , as discussed further below . the 2015 and 2014 net earnings and diluted earnings per share reflect the impact of stock-based compensation expense . the effect of these expenses reduced the 2015 net earnings and diluted earnings per share by $ 51 million and $ 0.15 , respectively , and the 2014 net earnings and diluted earnings per share by $ 41 million and $ 0.12 , respectively . the 2015 net earnings and diluted earnings per share also reflect the impact of amortization of acquisition-related intangibles and acquisition costs and related adjustments , both associated with our acquisition and integration of the cerner health services business , as well as costs related to the voluntary separation plan , as further described in note ( 1 ) of the notes to consolidated financial statements . amortization of acquisition-related intangibles related to the cerner health services business reduced 2015 net earnings and diluted earnings per share by $ 54 million and $ 0.15 , respectively . acquisition costs and related adjustments related to the cerner health services business reduced 2015 net earnings and diluted earnings per share by $ 31 million and $ 0.09 , respectively . costs related to the voluntary separation plan reduced net earnings and diluted earnings per share by $ 31 million and $ 0.09 , respectively . the 2014 net earnings and diluted earnings per share also reflect the impact of acquisition costs and related adjustments associated with our acquisition of the cerner health services business , which reduced net earnings and diluted earnings per share by $ 10 million and $ 0.03 , respectively . we had cash collections of receivables of $ 4.4 billion in 2015 compared to $ 3.5 billion in 2014 . days sales outstanding was 80 days for the 2015 fourth quarter compared to 85 days for the 2015 third quarter and 66 days for the 2014 fourth quarter . operating cash flows for 2015 were strong at $ 948 million compared to $ 847 million in 2014 . health care information technology market outlook we have provided an assessment of the health care information technology market under “ health care and health care it industry ” in part i , item 1 `` business , `` which is incorporated herein by reference . 26 results of operations fiscal year 2015 compared to fiscal year 2014 replace_table_token_4_th revenues & backlog revenues increased 30 % to $ 4.4 billion in 2015 , as compared to $ 3.4 billion in 2014 . story_separator_special_tag we have no off balance sheet arrangements as defined in regulation s-k. the effects of inflation on our business during 2015 , 2014 and 2013 were not significant . recent accounting pronouncements refer to note ( 1 ) of the notes to consolidated financial statements for information regarding recently issued accounting pronouncements . critical accounting policies we believe that there are several accounting policies that are critical to understanding our historical and future performance , as these policies affect the reported amount of revenue and other significant areas involving our judgments and estimates . these significant accounting policies relate to revenue recognition , software development , potential impairments of goodwill , and income taxes . these accounting policies and our procedures related to these accounting policies are described in detail below and under specific areas within this md & a . in addition , note ( 1 ) to the consolidated financial statements expands upon discussion of our accounting policies . revenue recognition we recognize revenue within our multiple element arrangements , including software and software-related services , using the residual method . key factors in our revenue recognition model are our assessments that implementation services are not essential to the functionality of our software , we can establish vendor specific objective evidence ( vsoe ) of fair value for any undelivered elements , and the length of time it takes for us to achieve the delivery and implementation milestones for our licensed software . if our business model were to change such that implementation services are deemed to be essential to the functionality of our software , the period of time over which our licensed software revenue would be recognized would lengthen . if vsoe of fair value can not be established for both the implementation services and the support services , the entire arrangement fee is recognized ratably over the period during which the implementation services are expected to be performed or the support period , whichever is longer , beginning with delivery of the software , provided that all other revenue recognition criteria are met . we also recognize revenue for certain projects in which services are deemed essential to the functionality of the software using the percentage of completion method . our revenue recognition is dependent upon our ability to reliably estimate the direct labor hours to complete a project which generally can span several years . we utilize our historical project experience and detailed planning process as a basis for our future estimates to complete current projects . significant delays in completion of the projects , unforeseen cost increases or penalties could result in significant reductions to revenue and margins on these contracts . the actual project results can be significantly different from the estimated results . when adjustments are identified 36 near or at the end of a project , the full impact of the change in estimate is recognized in that period . this can result in a material impact on our results for a single reporting period . software development costs costs incurred internally in creating computer software solutions and enhancements to those solutions are expensed until completion of a detailed program design , which is when we determine that technological feasibility has been established . thereafter , all software development costs are capitalized until such time as the software solutions and enhancements are available for general release , and the capitalized costs subsequently are reported at the lower of amortized cost or net realizable value . net realizable value is computed as the estimated gross future revenues from each software solution less the amount of estimated future costs of completing and disposing of that product . because the development of projected net future revenues related to our software solutions used in our net realizable value computation is based on estimates , a significant reduction in our future revenues could impact the recovery of our capitalized software development costs . if we missed our estimates of net future revenues by 10 % , the amount of our capitalized software development costs would not be impaired . capitalized costs are amortized based on current and expected net future revenue for each software solution with minimum annual amortization equal to the straight-line amortization over the estimated economic life of the software solution . we are amortizing capitalized costs over five years . the five-year period over which capitalized software development costs are amortized is an estimate based upon our forecast of a reasonable useful life for the capitalized costs . historically , use of our software programs by our clients has exceeded five years and is capable of being used a decade or more . we expect that major software information systems companies , large information technology consulting service providers and systems integrators and others specializing in the health care industry may offer competitive products or services . the pace of change in the hcit market is rapid and there are frequent new product introductions , product enhancements and evolving industry standards and requirements . as a result , the capitalized software solutions may become less valuable or obsolete and could be subject to impairment . goodwill goodwill is not amortized but is evaluated for impairment annually or whenever there is an impairment indicator . all goodwill is assigned to a reporting unit , where it is subject to an annual impairment assessment . we assess goodwill for impairment in the second quarter of each fiscal year and evaluate impairment indicators at each quarter end . we assessed our goodwill for impairment as of the second quarters of 2015 and 2014 and concluded that goodwill was not impaired . the assessments consisted of a qualitative analysis in accordance with accounting standards update 2011-08 , testing for goodwill impairment . a key consideration in conducting those analyses was the significant growth in both the revenues and operating earnings of our reporting units since our last quantitative assessment . our last quantitative assessment was performed in

liquidity and capital resources our liquidity is influenced by many factors , including the amount and timing of our revenues , our cash collections from our clients and the amount we invest in software development , acquisitions and capital expenditures . our principal sources of liquidity are our cash , cash equivalents , which primarily consist of money market funds and time deposits with original maturities of less than 90 days , and short-term investments . at the end of 2015 , we had cash and cash equivalents of $ 402 million and short-term investments of $ 111 million , as compared to cash and cash equivalents of $ 635 million and short-term investments of $ 786 million at the end of 2014 . we utilized a large amount of cash and investments to fund the acquisition of the cerner health services business in february 2015. the non-u.s. subsidiaries for which we have elected to indefinitely reinvest earnings outside the u.s. held approximately 35 % of our aggregate cash , cash equivalents and short-term investments at january 2 , 2016 . as part of our current business strategy , we plan to indefinitely reinvest the earnings of these foreign operations ; however , should the earnings of these foreign operations be repatriated , we would accrue and pay tax on such earnings , which may be material . we maintain a $ 100 million multi-year revolving credit facility , which expires in october 2020. the facility provides an unsecured revolving line of credit for working capital purposes , which includes a letter of credit facility . we have the ability to increase the maximum capacity to $ 200 million at any time during the facility 's term , subject to lender participation . as of the end of 2015 , we had no outstanding borrowings under this facility ; however , we had $ 16 million of outstanding letters of credit , which reduced our available borrowing capacity to $ 84 million . refer to note ( 9 ) of the notes to consolidated financial statements for additional information regarding our credit facility .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```liquidity and capital resources our liquidity is influenced by many factors , including the amount and timing of our revenues , our cash collections from our clients and the amount we invest in software development , acquisitions and capital expenditures . our principal sources of liquidity are our cash , cash equivalents , which primarily consist of money market funds and time deposits with original maturities of less than 90 days , and short-term investments . at the end of 2015 , we had cash and cash equivalents of $ 402 million and short-term investments of $ 111 million , as compared to cash and cash equivalents of $ 635 million and short-term investments of $ 786 million at the end of 2014 . we utilized a large amount of cash and investments to fund the acquisition of the cerner health services business in february 2015. the non-u.s. subsidiaries for which we have elected to indefinitely reinvest earnings outside the u.s. held approximately 35 % of our aggregate cash , cash equivalents and short-term investments at january 2 , 2016 . as part of our current business strategy , we plan to indefinitely reinvest the earnings of these foreign operations ; however , should the earnings of these foreign operations be repatriated , we would accrue and pay tax on such earnings , which may be material . we maintain a $ 100 million multi-year revolving credit facility , which expires in october 2020. the facility provides an unsecured revolving line of credit for working capital purposes , which includes a letter of credit facility . we have the ability to increase the maximum capacity to $ 200 million at any time during the facility 's term , subject to lender participation . as of the end of 2015 , we had no outstanding borrowings under this facility ; however , we had $ 16 million of outstanding letters of credit , which reduced our available borrowing capacity to $ 84 million . refer to note ( 9 ) of the notes to consolidated financial statements for additional information regarding our credit facility . ``` Suspicious Activity Report : we expect to drive continued earnings growth through ongoing revenue growth coupled with margin expansion , which we expect to achieve through efficiencies in our implementation and operational processes and by leveraging r & d investments and controlling general and administrative expenses . we are also focused on continuing to deliver strong levels of cash flow , which we expect to do by continuing to grow earnings and prudently managing capital expenditures . siemens health services on february 2 , 2015 , we acquired substantially all of the assets , and assumed certain liabilities of siemens ag 's health information technology business unit , siemens health services , as further described in note ( 2 ) of the notes to consolidated financial statements . the acquired business ( now referred to as `` cerner health services `` ) offers a portfolio of enterprise-level clinical and financial health care information technology solutions , as well as departmental , connectivity , population health , and care coordination solutions globally . solutions are offered on the soarian , invision , and i.s.h.med platforms , among others . cerner health services also offers a range of complementary services including support , hosting , managed services , implementation services , and strategic consulting . we believe the acquisition enhances our organic growth opportunities as it provides us a larger base into which we can sell our combined portfolio of solutions and services . the acquisition also augments our non-u.s. footprint and growth opportunities , increases our scale for r & d investment , and adds over 5,000 highly-skilled associates that will enhance our capabilities . 25 the addition of this business has a significant impact on the comparability of our 2015 consolidated financial statements in relation to the comparative periods presented herein . results overview the company delivered strong levels of bookings , revenues , earnings and operating cash flows in 2015 . new business bookings revenue in 2015 , which reflects the value of executed contracts for software , hardware , professional services and managed services , was $ 5.4 billion , which is an increase of 28 % compared to $ 4.3 billion in 2014 . revenues for 2015 increased 30 % to $ 4.4 billion compared to $ 3.4 billion in 2014 . our fiscal year 2015 revenues include approximately $ 930 million attributable to the acquired cerner health services business . the remaining year-over-year increase in revenue reflects ongoing demand for cerner 's core solutions and services driven by our clients ' needs to keep up with regulatory requirements ; contributions from cerner itworks and revenue cycle solutions and services ; and attaining new clients . our 2015 net earnings were $ 539 million compared to $ 525 million in 2014 . diluted earnings per share were $ 1.54 in 2015 compared to $ 1.50 in 2014 . disclosure of the earnings contribution from the cerner health services business is not practicable , as we have already integrated operations in many areas . the overall increase in net earnings and diluted earnings per share was primarily a result of increased revenues , partially offset by elevated operating expenses , which included costs associated with the acquisition and integration of the cerner health services business , and our voluntary separation plan , as discussed further below . the 2015 and 2014 net earnings and diluted earnings per share reflect the impact of stock-based compensation expense . the effect of these expenses reduced the 2015 net earnings and diluted earnings per share by $ 51 million and $ 0.15 , respectively , and the 2014 net earnings and diluted earnings per share by $ 41 million and $ 0.12 , respectively . the 2015 net earnings and diluted earnings per share also reflect the impact of amortization of acquisition-related intangibles and acquisition costs and related adjustments , both associated with our acquisition and integration of the cerner health services business , as well as costs related to the voluntary separation plan , as further described in note ( 1 ) of the notes to consolidated financial statements . amortization of acquisition-related intangibles related to the cerner health services business reduced 2015 net earnings and diluted earnings per share by $ 54 million and $ 0.15 , respectively . acquisition costs and related adjustments related to the cerner health services business reduced 2015 net earnings and diluted earnings per share by $ 31 million and $ 0.09 , respectively . costs related to the voluntary separation plan reduced net earnings and diluted earnings per share by $ 31 million and $ 0.09 , respectively . the 2014 net earnings and diluted earnings per share also reflect the impact of acquisition costs and related adjustments associated with our acquisition of the cerner health services business , which reduced net earnings and diluted earnings per share by $ 10 million and $ 0.03 , respectively . we had cash collections of receivables of $ 4.4 billion in 2015 compared to $ 3.5 billion in 2014 . days sales outstanding was 80 days for the 2015 fourth quarter compared to 85 days for the 2015 third quarter and 66 days for the 2014 fourth quarter . operating cash flows for 2015 were strong at $ 948 million compared to $ 847 million in 2014 . health care information technology market outlook we have provided an assessment of the health care information technology market under “ health care and health care it industry ” in part i , item 1 `` business , `` which is incorporated herein by reference . 26 results of operations fiscal year 2015 compared to fiscal year 2014 replace_table_token_4_th revenues & backlog revenues increased 30 % to $ 4.4 billion in 2015 , as compared to $ 3.4 billion in 2014 . story_separator_special_tag we have no off balance sheet arrangements as defined in regulation s-k. the effects of inflation on our business during 2015 , 2014 and 2013 were not significant . recent accounting pronouncements refer to note ( 1 ) of the notes to consolidated financial statements for information regarding recently issued accounting pronouncements . critical accounting policies we believe that there are several accounting policies that are critical to understanding our historical and future performance , as these policies affect the reported amount of revenue and other significant areas involving our judgments and estimates . these significant accounting policies relate to revenue recognition , software development , potential impairments of goodwill , and income taxes . these accounting policies and our procedures related to these accounting policies are described in detail below and under specific areas within this md & a . in addition , note ( 1 ) to the consolidated financial statements expands upon discussion of our accounting policies . revenue recognition we recognize revenue within our multiple element arrangements , including software and software-related services , using the residual method . key factors in our revenue recognition model are our assessments that implementation services are not essential to the functionality of our software , we can establish vendor specific objective evidence ( vsoe ) of fair value for any undelivered elements , and the length of time it takes for us to achieve the delivery and implementation milestones for our licensed software . if our business model were to change such that implementation services are deemed to be essential to the functionality of our software , the period of time over which our licensed software revenue would be recognized would lengthen . if vsoe of fair value can not be established for both the implementation services and the support services , the entire arrangement fee is recognized ratably over the period during which the implementation services are expected to be performed or the support period , whichever is longer , beginning with delivery of the software , provided that all other revenue recognition criteria are met . we also recognize revenue for certain projects in which services are deemed essential to the functionality of the software using the percentage of completion method . our revenue recognition is dependent upon our ability to reliably estimate the direct labor hours to complete a project which generally can span several years . we utilize our historical project experience and detailed planning process as a basis for our future estimates to complete current projects . significant delays in completion of the projects , unforeseen cost increases or penalties could result in significant reductions to revenue and margins on these contracts . the actual project results can be significantly different from the estimated results . when adjustments are identified 36 near or at the end of a project , the full impact of the change in estimate is recognized in that period . this can result in a material impact on our results for a single reporting period . software development costs costs incurred internally in creating computer software solutions and enhancements to those solutions are expensed until completion of a detailed program design , which is when we determine that technological feasibility has been established . thereafter , all software development costs are capitalized until such time as the software solutions and enhancements are available for general release , and the capitalized costs subsequently are reported at the lower of amortized cost or net realizable value . net realizable value is computed as the estimated gross future revenues from each software solution less the amount of estimated future costs of completing and disposing of that product . because the development of projected net future revenues related to our software solutions used in our net realizable value computation is based on estimates , a significant reduction in our future revenues could impact the recovery of our capitalized software development costs . if we missed our estimates of net future revenues by 10 % , the amount of our capitalized software development costs would not be impaired . capitalized costs are amortized based on current and expected net future revenue for each software solution with minimum annual amortization equal to the straight-line amortization over the estimated economic life of the software solution . we are amortizing capitalized costs over five years . the five-year period over which capitalized software development costs are amortized is an estimate based upon our forecast of a reasonable useful life for the capitalized costs . historically , use of our software programs by our clients has exceeded five years and is capable of being used a decade or more . we expect that major software information systems companies , large information technology consulting service providers and systems integrators and others specializing in the health care industry may offer competitive products or services . the pace of change in the hcit market is rapid and there are frequent new product introductions , product enhancements and evolving industry standards and requirements . as a result , the capitalized software solutions may become less valuable or obsolete and could be subject to impairment . goodwill goodwill is not amortized but is evaluated for impairment annually or whenever there is an impairment indicator . all goodwill is assigned to a reporting unit , where it is subject to an annual impairment assessment . we assess goodwill for impairment in the second quarter of each fiscal year and evaluate impairment indicators at each quarter end . we assessed our goodwill for impairment as of the second quarters of 2015 and 2014 and concluded that goodwill was not impaired . the assessments consisted of a qualitative analysis in accordance with accounting standards update 2011-08 , testing for goodwill impairment . a key consideration in conducting those analyses was the significant growth in both the revenues and operating earnings of our reporting units since our last quantitative assessment . our last quantitative assessment was performed in

under the consignment , or fixed fee , program , we generally charge an additional fee for title processing and special preparation . although sometimes included in the consignment fee , we may also charge additional fees for the cost of transporting the vehicle to our facility , storage of the vehicle , and other incidental costs . under the consignment programs , only the fees associated with vehicle processing are recorded in revenue , not the actual 31 sales price ( gross proceeds ) . sales transaction fees also include fees charged to vehicle buyers for purchasing vehicles , storage , loading and annual registration . transportation revenue includes charges to sellers for towing vehicles under certain contracts . transportation revenue also includes towing charges assessed to buyers for delivering vehicles . purchased vehicle revenue includes the gross sales price of the vehicle which we have purchased or are otherwise considered to own and is primarily generated in the uk . operating costs consist primarily of operating personnel ( which includes yard management , clerical and yard employees ) , rent , contract vehicle towing , insurance , fuel , equipment maintenance and repair , and costs of vehicles we sold under purchase contracts . costs associated with general and administrative expenses consist primarily of executive management , accounting , data processing , sales personnel , human resources , professional fees , research and development and marketing expenses . during fiscal 2004 and fiscal 2008 , we converted all of our north american and uk sales , respectively , to an internet-based auction-style model using our vb 2 internet sales technology which employs a two-step bidding process . the first step , called the preliminary bid , allows members to submit bids up to one hour before a real time virtual auction begins . the second step allows members to bid against each other , and the high bidder from the preliminary bidding process , in a real-time process over the internet . acquisitions and new operations we have experienced significant growth in facilities as we have acquired seven facilities and established seven new facilities since the beginning of fiscal 2009. all of these acquisitions have been accounted for using the purchase method of accounting . as part of our overall expansion strategy of offering integrated services to vehicle sellers , we anticipate acquiring and developing facilities in new regions , as well as the regions currently served by our facilities . we believe that these acquisitions and openings strengthen our coverage as we have 153 facilities located in north america and the uk as of july 31 , 2011 and are able to provide national coverage for our sellers . the following table sets forth facilities that we have acquired or opened from august 1 , 2008 through july 31 , 2011 : locations acquisition or greenfield date geographic service area louisville , kentucky greenfield september 2008 northwest kentucky and southern indiana richmond , virginia greenfield * october 2008 central virginia montgomery , alabama greenfield february 2009 central alabama greer , south carolina greenfield february 2009 northwest south carolina warren , massachusetts greenfield june 2009 central massachusetts bristol , england acquisition january 2010 united kingdom bedford , england acquisition january 2010 united kingdom colchester , england acquisition january 2010 united kingdom gainsborough , england acquisition * * january 2010 united kingdom luton , england acquisition january 2010 united kingdom scranton , pennsylvania greenfield february 2010 central pennsylvania homestead , florida greenfield september 2010 southern florida hartford city , indiana acquisition march 2011 central indiana wolverhampton , england acquisition march 2011 united kingdom * former mag facility * * closed in fiscal 2010 in january 2010 , the company completed the acquisition of d hales limited ( d hales ) which operated five locations in the united kingdom . in fiscal 2011 , we acquired john hewitt and sons , limited ( hewitt ) 32 which operated one location in the united kingdom . these acquisitions were undertaken because of their strategic fit with our business in the united kingdom . the period-to-period comparability of our consolidated operating results and financial condition is affected by business acquisitions , new openings , weather and product introductions during such periods . in particular , we have certain contracts inherited through our uk acquisitions that require us to act as a principal , purchasing vehicles from the insurance companies and reselling them for our own account . it is our intention , where possible , to migrate these contracts to the agency model in future periods . changes in the amount of revenue derived in a period from principal transactions relative to total revenue will impact revenue growth and margin percentages . in addition to growth through acquisitions , we seek to increase revenues and profitability by , among other things , ( i ) acquiring and developing additional vehicle storage facilities in key markets , ( ii ) pursuing national and regional vehicle seller agreements , ( iii ) expanding our service offerings to sellers and members , and ( iv ) expanding the application of vb 2 into new markets . in addition , we implement our pricing structure and auction procedures and attempt to introduce cost efficiencies at each of our acquired facilities by implementing our operational procedures , integrating our management information systems and redeploying personnel , when necessary . results of operations fiscal 2011 compared to fiscal 2010 revenues the following table sets forth information on revenue by class ( in thousands , except percentages ) : replace_table_token_7_th service revenues . story_separator_special_tag the purchase of the shares of common stock was funded by the proceeds relating to the issuance of $ 400.0 million of long term debt . during the year ended july 31 , 2011 , we made principal payments of $ 25.0 million . in the second and fourth quarters of fiscal year 2009 and the first quarter of fiscal year 2010 , mr. adair , chief executive officer ( and then president ) , exercised stock options through cashless exercises . in the fourth quarter of fiscal year 2010 , mr. johnson , chairman of the board , exercised stock options through a cashless exercise . in the second , third and fourth quarters of fiscal year 2011 certain executive officers exercised stock options through cashless exercises . a portion of the options exercised were net settled in satisfaction of the exercise price and federal and state minimum statutory tax withholding requirements . we remitted $ 4.2 million , $ 7.4 million and $ 9.8 million , in fiscal 2011 , 2010 and 2009 , respectively , to the proper taxing 38 authorities in satisfaction of the employees ' minimum statutory withholding requirements . the exercises are summarized in the following table : replace_table_token_9_th ( 1 ) shares withheld for taxes are treated as a repurchase of shares for accounting purposes but do not count against our stock repurchase program . contractual obligations we lease certain domestic and foreign facilities , and certain equipment under non-cancelable operating leases . in addition to the minimum future lease commitments presented , the leases generally require the company to pay property taxes , insurance , maintenance and repair costs which are not included in the table because we have determined these items are not material . the following table summarizes our significant contractual obligations and commercial commitments as of july 31 , 2011 ( in thousands ) : replace_table_token_10_th amount of commitment expiration per period commercial commitments ( 3 ) total less than 1 year 1–3 years 3–5 years more than 5 years other letters of credit $ 6,709 $ 6,709 $ — $ — $ — $ — ( 1 ) contractual obligations consist of future non-cancelable minimum lease payments under capital and operating leases , used in the normal course of business . ( 2 ) tax liabilities include the long-term liabilities in the consolidated balance sheet for unrecognized tax positions . at this time we are unable to make a reasonably reliable estimate of the timing of payments in individual years beyond 12 months due to uncertainties in the timing of tax audit outcomes . ( 3 ) commercial commitments consist primarily of letters of credit provided for insurance programs and certain business transactions . 39 credit facilities on december 14 , 2010 , we entered into an amended and restated credit facility agreement ( credit facility ) , which supersedes our previously disclosed credit agreement with bank of america , n.a . ( bank of america ) . the credit facility is an unsecured credit agreement providing for ( i ) a $ 100.0 million revolving credit facility , including a $ 100.0 million alternative currency borrowing sublimit and a $ 50.0 million letter of credit sublimit ( revolving credit ) and ( ii ) a term loan facility of $ 400.0 million ( term loan ) . on january 14 , 2011 the full $ 400.0 million provided under the term loan was borrowed . the term loan matures and all outstanding borrowings are due on december 14 , 2015 , with quarterly payments of $ 12.5 million in principal plus interest to be made beginning march 31 , 2011 through the maturity date . all amounts borrowed under the term loan may be prepaid without premium or penalty . during the year ended july 31 , 2011 , we made principal repayments of $ 25.0 million . at july 31 , 2011 , the outstanding term loan balance is $ 375.1 million . amounts borrowed under the credit facility bear interest , subject to certain restrictions , at a fluctuating rate based on ( i ) the eurocurrency rate , ( ii ) the federal funds rate or ( iii ) the prime rate as described in the credit facility . a default interest rate applies on all obligations during an event of default under the credit facility , at a rate per annum equal to 2.0 % above the otherwise applicable interest rate . at july 31 , 2011 the interest rate was the eurocurrency rate plus 1.50 % . at july 31 , 2011 , the eurocurrency rate was 1.69 % . the credit facility is guaranteed by our material domestic subsidiaries . the carrying value of the loan payable approximates its fair value at july 31 , 2011 due to the variable rate nature of the loan . amounts borrowed under the revolving credit may be repaid and reborrowed until the maturity date , which is december 14 , 2015. the credit facility requires us to pay a commitment fee on the unused portion of the revolving credit . the commitment fee ranges from 0.075 % to 0.125 % per annum depending on our leverage ratio , as of the end of the previous quarter . we had no outstanding borrowings under the revolving credit at the end of the period . the amended and restated credit agreement contains customary representations and warranties and may place certain business operating restrictions on us relating to , among other things , indebtedness , liens and other encumbrances , investments , mergers and acquisitions , asset sales , dividends and distributions and redemptions of capital stock . in addition , the amended and restated credit agreement provides for the following financial covenants : 1 ) earnings before income tax , depreciation and amortization ( ebitda ) , 2 ) leverage ratio , 3 ) interest coverage ratio , and 4 ) limitations on capital expenditures .

liquidity and capital resources our primary source of working capital is cash generated though operations . potential internal sources of additional working capital are the sale of assets or the issuance of equity through option exercises and shares issued under our employee stock purchase plan . a potential external source of additional working capital is the issuance of debt and equity . however , with respect to the issuance of equity or debt , we can not predict if these sources will be available in the future and , if available , if they can be issued under terms commercially acceptable to us . historically , we have financed our growth through cash generated from operations , public offerings of common stock , the equity issued in conjunction with certain acquisitions and debt financing . our primary 36 source of cash generated by operations is from the collection of sellers ' fees , members ' fees and reimbursable advances from the proceeds of auctioned salvage vehicles . our business is seasonal as inclement weather during the winter months increases the frequency of accidents and , consequently , the number of cars totaled by the insurance companies . during the winter months , most of our facilities process 10 % to 30 % more vehicles than at other times of the year . this increased volume requires the increased use of our cash to pay out advances and handling costs of the additional business . our primary source of working capital is net income . accordingly , factors affecting net income are the principal factors affecting the generation of working capital .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```liquidity and capital resources our primary source of working capital is cash generated though operations . potential internal sources of additional working capital are the sale of assets or the issuance of equity through option exercises and shares issued under our employee stock purchase plan . a potential external source of additional working capital is the issuance of debt and equity . however , with respect to the issuance of equity or debt , we can not predict if these sources will be available in the future and , if available , if they can be issued under terms commercially acceptable to us . historically , we have financed our growth through cash generated from operations , public offerings of common stock , the equity issued in conjunction with certain acquisitions and debt financing . our primary 36 source of cash generated by operations is from the collection of sellers ' fees , members ' fees and reimbursable advances from the proceeds of auctioned salvage vehicles . our business is seasonal as inclement weather during the winter months increases the frequency of accidents and , consequently , the number of cars totaled by the insurance companies . during the winter months , most of our facilities process 10 % to 30 % more vehicles than at other times of the year . this increased volume requires the increased use of our cash to pay out advances and handling costs of the additional business . our primary source of working capital is net income . accordingly , factors affecting net income are the principal factors affecting the generation of working capital . ``` Suspicious Activity Report : under the consignment , or fixed fee , program , we generally charge an additional fee for title processing and special preparation . although sometimes included in the consignment fee , we may also charge additional fees for the cost of transporting the vehicle to our facility , storage of the vehicle , and other incidental costs . under the consignment programs , only the fees associated with vehicle processing are recorded in revenue , not the actual 31 sales price ( gross proceeds ) . sales transaction fees also include fees charged to vehicle buyers for purchasing vehicles , storage , loading and annual registration . transportation revenue includes charges to sellers for towing vehicles under certain contracts . transportation revenue also includes towing charges assessed to buyers for delivering vehicles . purchased vehicle revenue includes the gross sales price of the vehicle which we have purchased or are otherwise considered to own and is primarily generated in the uk . operating costs consist primarily of operating personnel ( which includes yard management , clerical and yard employees ) , rent , contract vehicle towing , insurance , fuel , equipment maintenance and repair , and costs of vehicles we sold under purchase contracts . costs associated with general and administrative expenses consist primarily of executive management , accounting , data processing , sales personnel , human resources , professional fees , research and development and marketing expenses . during fiscal 2004 and fiscal 2008 , we converted all of our north american and uk sales , respectively , to an internet-based auction-style model using our vb 2 internet sales technology which employs a two-step bidding process . the first step , called the preliminary bid , allows members to submit bids up to one hour before a real time virtual auction begins . the second step allows members to bid against each other , and the high bidder from the preliminary bidding process , in a real-time process over the internet . acquisitions and new operations we have experienced significant growth in facilities as we have acquired seven facilities and established seven new facilities since the beginning of fiscal 2009. all of these acquisitions have been accounted for using the purchase method of accounting . as part of our overall expansion strategy of offering integrated services to vehicle sellers , we anticipate acquiring and developing facilities in new regions , as well as the regions currently served by our facilities . we believe that these acquisitions and openings strengthen our coverage as we have 153 facilities located in north america and the uk as of july 31 , 2011 and are able to provide national coverage for our sellers . the following table sets forth facilities that we have acquired or opened from august 1 , 2008 through july 31 , 2011 : locations acquisition or greenfield date geographic service area louisville , kentucky greenfield september 2008 northwest kentucky and southern indiana richmond , virginia greenfield * october 2008 central virginia montgomery , alabama greenfield february 2009 central alabama greer , south carolina greenfield february 2009 northwest south carolina warren , massachusetts greenfield june 2009 central massachusetts bristol , england acquisition january 2010 united kingdom bedford , england acquisition january 2010 united kingdom colchester , england acquisition january 2010 united kingdom gainsborough , england acquisition * * january 2010 united kingdom luton , england acquisition january 2010 united kingdom scranton , pennsylvania greenfield february 2010 central pennsylvania homestead , florida greenfield september 2010 southern florida hartford city , indiana acquisition march 2011 central indiana wolverhampton , england acquisition march 2011 united kingdom * former mag facility * * closed in fiscal 2010 in january 2010 , the company completed the acquisition of d hales limited ( d hales ) which operated five locations in the united kingdom . in fiscal 2011 , we acquired john hewitt and sons , limited ( hewitt ) 32 which operated one location in the united kingdom . these acquisitions were undertaken because of their strategic fit with our business in the united kingdom . the period-to-period comparability of our consolidated operating results and financial condition is affected by business acquisitions , new openings , weather and product introductions during such periods . in particular , we have certain contracts inherited through our uk acquisitions that require us to act as a principal , purchasing vehicles from the insurance companies and reselling them for our own account . it is our intention , where possible , to migrate these contracts to the agency model in future periods . changes in the amount of revenue derived in a period from principal transactions relative to total revenue will impact revenue growth and margin percentages . in addition to growth through acquisitions , we seek to increase revenues and profitability by , among other things , ( i ) acquiring and developing additional vehicle storage facilities in key markets , ( ii ) pursuing national and regional vehicle seller agreements , ( iii ) expanding our service offerings to sellers and members , and ( iv ) expanding the application of vb 2 into new markets . in addition , we implement our pricing structure and auction procedures and attempt to introduce cost efficiencies at each of our acquired facilities by implementing our operational procedures , integrating our management information systems and redeploying personnel , when necessary . results of operations fiscal 2011 compared to fiscal 2010 revenues the following table sets forth information on revenue by class ( in thousands , except percentages ) : replace_table_token_7_th service revenues . story_separator_special_tag the purchase of the shares of common stock was funded by the proceeds relating to the issuance of $ 400.0 million of long term debt . during the year ended july 31 , 2011 , we made principal payments of $ 25.0 million . in the second and fourth quarters of fiscal year 2009 and the first quarter of fiscal year 2010 , mr. adair , chief executive officer ( and then president ) , exercised stock options through cashless exercises . in the fourth quarter of fiscal year 2010 , mr. johnson , chairman of the board , exercised stock options through a cashless exercise . in the second , third and fourth quarters of fiscal year 2011 certain executive officers exercised stock options through cashless exercises . a portion of the options exercised were net settled in satisfaction of the exercise price and federal and state minimum statutory tax withholding requirements . we remitted $ 4.2 million , $ 7.4 million and $ 9.8 million , in fiscal 2011 , 2010 and 2009 , respectively , to the proper taxing 38 authorities in satisfaction of the employees ' minimum statutory withholding requirements . the exercises are summarized in the following table : replace_table_token_9_th ( 1 ) shares withheld for taxes are treated as a repurchase of shares for accounting purposes but do not count against our stock repurchase program . contractual obligations we lease certain domestic and foreign facilities , and certain equipment under non-cancelable operating leases . in addition to the minimum future lease commitments presented , the leases generally require the company to pay property taxes , insurance , maintenance and repair costs which are not included in the table because we have determined these items are not material . the following table summarizes our significant contractual obligations and commercial commitments as of july 31 , 2011 ( in thousands ) : replace_table_token_10_th amount of commitment expiration per period commercial commitments ( 3 ) total less than 1 year 1–3 years 3–5 years more than 5 years other letters of credit $ 6,709 $ 6,709 $ — $ — $ — $ — ( 1 ) contractual obligations consist of future non-cancelable minimum lease payments under capital and operating leases , used in the normal course of business . ( 2 ) tax liabilities include the long-term liabilities in the consolidated balance sheet for unrecognized tax positions . at this time we are unable to make a reasonably reliable estimate of the timing of payments in individual years beyond 12 months due to uncertainties in the timing of tax audit outcomes . ( 3 ) commercial commitments consist primarily of letters of credit provided for insurance programs and certain business transactions . 39 credit facilities on december 14 , 2010 , we entered into an amended and restated credit facility agreement ( credit facility ) , which supersedes our previously disclosed credit agreement with bank of america , n.a . ( bank of america ) . the credit facility is an unsecured credit agreement providing for ( i ) a $ 100.0 million revolving credit facility , including a $ 100.0 million alternative currency borrowing sublimit and a $ 50.0 million letter of credit sublimit ( revolving credit ) and ( ii ) a term loan facility of $ 400.0 million ( term loan ) . on january 14 , 2011 the full $ 400.0 million provided under the term loan was borrowed . the term loan matures and all outstanding borrowings are due on december 14 , 2015 , with quarterly payments of $ 12.5 million in principal plus interest to be made beginning march 31 , 2011 through the maturity date . all amounts borrowed under the term loan may be prepaid without premium or penalty . during the year ended july 31 , 2011 , we made principal repayments of $ 25.0 million . at july 31 , 2011 , the outstanding term loan balance is $ 375.1 million . amounts borrowed under the credit facility bear interest , subject to certain restrictions , at a fluctuating rate based on ( i ) the eurocurrency rate , ( ii ) the federal funds rate or ( iii ) the prime rate as described in the credit facility . a default interest rate applies on all obligations during an event of default under the credit facility , at a rate per annum equal to 2.0 % above the otherwise applicable interest rate . at july 31 , 2011 the interest rate was the eurocurrency rate plus 1.50 % . at july 31 , 2011 , the eurocurrency rate was 1.69 % . the credit facility is guaranteed by our material domestic subsidiaries . the carrying value of the loan payable approximates its fair value at july 31 , 2011 due to the variable rate nature of the loan . amounts borrowed under the revolving credit may be repaid and reborrowed until the maturity date , which is december 14 , 2015. the credit facility requires us to pay a commitment fee on the unused portion of the revolving credit . the commitment fee ranges from 0.075 % to 0.125 % per annum depending on our leverage ratio , as of the end of the previous quarter . we had no outstanding borrowings under the revolving credit at the end of the period . the amended and restated credit agreement contains customary representations and warranties and may place certain business operating restrictions on us relating to , among other things , indebtedness , liens and other encumbrances , investments , mergers and acquisitions , asset sales , dividends and distributions and redemptions of capital stock . in addition , the amended and restated credit agreement provides for the following financial covenants : 1 ) earnings before income tax , depreciation and amortization ( ebitda ) , 2 ) leverage ratio , 3 ) interest coverage ratio , and 4 ) limitations on capital expenditures .

as a result , our foreign businesses contributed over half of our sales in 2020 , up from 43 percent in 2016. our most recent acquisition of powera in late 2020 is about accelerating growth and entering into an attractive consumer product adjacency of third-party video game controllers , power charging stations , and headsets . the addition of powera will meaningfully improve our organic sales growth and profitability and increase our presence in faster growing mass and e-commerce channels . powera is expected to provide strong double-digit sales growth in the u.s. , as well as opportunities for expansion internationally , particularly in europe . it greatly advances our strategic shift toward consumer , school and technology products as more than half of our sales will now come from these product categories , which offer faster growing 28 demand . on a pro forma basis , including full year powera sales for 2020 , computer and gaming products would represent approximately 22 percent of our sales . our leading product category positions provide the scale to invest in marketing and product innovation to drive profitable growth . we now expect to grow in mature markets in consumer , technology , and adjacent categories driven by new product development . we will also continue to grow in emerging markets once the impact of covid-19 subsides in latin america and parts of asia , the middle east , and eastern europe . in all of our markets , we see opportunities for sales growth through share gains , channel and geographic expansion , and product enhancements . we generate strong operating cash flow , and will continue to leverage our cost structure through acquisitions , synergies and productivity savings to drive long-term profit and operating cash flow improvement . overview of 2020 performance as used in this annual report on form 10-k , `` covid-19 impacts `` include the operational , financial , and other effects on acco brands , our customers and end users of our products , of school and business closures , work from home , remote and hybrid learning , government orders and manufacturing , distribution , supply chain and other disruptions resulting from covid-19 , and the actions acco brands , our customers and end users have taken in response to the pandemic , including actions we have taken to manage our inventory and credit risk under the circumstances . the covid-19 impacts on our business have varied and continue to vary significantly by geographic region and country depending upon a range of factors , including how seriously the pandemic is affecting public health in the country and whether and to what degree businesses and schools are open , the general seasonality of our business in that country , the nature and level of government support , and the channel structure . during 2020 , all segments were impacted by covid-19 , but emea experienced lower impacts and our international segment experienced , and continues to experience , the highest impacts , largely in latin america due to the seriousness of the pandemic and the dependence of our brazilian and mexican businesses on the sale of school products . many schools and offices in latin america have been closed since the onset of the pandemic and access to online learning is limited . in north america , following good sell-in of back-to-school products in the second quarter , our third quarter sales were adversely affected by weaker sell-out . our net sales declined $ 300.5 million , or 15.4 percent in 2020 primarily from covid-19 impacts . those impacts vary based upon the channel . replace_table_token_5_th operating income declined 42.7 percent , primarily due to the lower sales , partially offset by company-wide cost reductions and government assistance in certain countries , generally in return for maintaining employment , pay and benefits . foreign exchange had a minimal impact on sales . from a net profit perspective , foreign exchange was unfavorable by $ 0.8 million . operating cash inflow for 2020 was $ 119.2 million compared with last year 's operating cash inflow of $ 203.9 million . the $ 84.7 million year-over-year difference was due to lower net income . operating cash flow in 2020 was used to fund : ( in millions ) use of cash debt repayments $ 51.3 share repurchases 16.3 dividends 24.6 capital expenditures 15.3 increase in cash on hand 8.8 debt issuance cost 3.2 29 covid-19 impact covid-19 and the actions being taken by national , state and local governments , businesses , schools and others to address it ( including work from home , quarantines , travel restrictions , business and school closures , remote and hybrid learning , and cancellations of , and limitations on , public gatherings ) have caused and continue to cause significant disruptions to normal business operations and have had , and are expected to continue to have , significant adverse impacts on our customers and end-users worldwide . similarly , our business , sales , earnings , and results of operations have been and will continue to be materially adversely affected by these events , as well as the current and expected continued negative impact on the global economy . we expect that uncertainties regarding when the risks of the pandemic will subside and how geographies , distribution channels and consumer behaviors will evolve over time in response to the pandemic will continue . we expect the company to be in a stronger competitive position after the pandemic because of our strong brands , more diversified and healthier channels , investments in innovative products , solid financial position , and disciplined execution . we are assessing likely changes to consumer behavior post pandemic and will continue to adjust our business and product strategy to align with evolving consumer preferences . story_separator_special_tag selling , general and administrative expenses selling , general and administrative expenses ( `` sg & a `` ) include advertising , marketing , selling ( including commissions ) , research and development , customer service , depreciation related to assets outside the manufacturing and distribution processes , and all other general and administrative expenses outside the manufacturing and distribution functions ( e.g . , finance , human resources , information technology ) . for the year ended december 31 , 2020 , foreign exchange reduced sg & a $ 3.9 million , or 1.0 percent , and the acquisitions added $ 7.4 million , or 1.9 percent , including $ 4.4 million of integration and transaction costs . t he prior-year period included $ 2.3 million in integration costs related to prior acquisitions . excluding the acquisitions , integration and transaction costs , and foreign exchange , sg & a benefited from cost reductions and lower incentive accruals , partly offset by increases for bad debts . we received $ 5.2 million in governm ent assistance , primarily provided in return for maintaining employment and wages . for the year ended december 31 , 2020 , sg & a as a percentage of net sales increased , primarily due to lower net sales . restructuring charges for the year ended december 31 , 2020 , r estructuring charges were $ 10.9 million . costs associated with severance expense in north america were $ 6.2 million . the remainder of the severance charges were primarily in brazil , mexico , and australia . lease abandonment charges were $ 1.5 million related to facilities in north america . the prior-year charges were related to severance costs associated with changes in the operating structure of our north america and international segments . operating income for the year ended december 31 , 2020 , operating income decreased , primarily due to lower net sales from covid-19 impacts , which were partially offset by cost reductions . foreign exchange benefited operating income $ 1.5 million , or 0.8 percent . foroni contributed a loss of $ 2.7 million and powera added operating income of $ 0.4 million . interest expense and income for the year ended december 31 , 2020 , the decrease in interest expense was primarily due to lower average debt outstanding and lower interest rates on our variable rate debt . the decrease in interest income was primarily due to lower cash balances being held in brazil . other expense ( income ) , net other expense ( income ) , net was an expense of $ 1.6 million compared with income of $ 1.8 million in 2019. the increase in expense was primarily due to the higher foreign exchange loss in 2020 and a lower benefit from using our brazilian operating tax credits . income tax expense for the year ended december 31 , 2020 , we recorded income tax expense of $ 16.6 million on income before taxes of $ 78.6 million for an effective tax rate of 21.1 percent . the decrease in the effective rate versus 2019 was primarily due to an increase in reserves for uncertain tax positions in the prior year , the election to exclude high-taxed intangible income from the global intangible low-taxed income ( `` gilti `` ) computation , and beneficial adjustments to deferred taxes resulting from statutory tax rate changes . for the year ended december 31 , 2019 , the high effective tax rate was primarily due to $ 5.6 million in additional reserves for uncertain tax positions in connection with the brazil tax assessments that were recorded in the first quarter of 2019. see `` note 12. income taxes - brazil tax assessments `` to the condensed consolidated financial statements contained in part ii , item 8. of this report for additional details . 35 net income/diluted income per share for the year ended december 31 , 2020 , net income decreased primarily due to lower operating income . foreign exchange decreased net income $ 0.8 million , or 0.7 percent . diluted income per share benefited from fewer outstanding shares . segment net sales and operating income for the years ended december 31 , 2020 and 2019 acco brands north america replace_table_token_8_th ( 1 ) segment operating income excludes corporate costs . see `` note 18. information on business segments `` to the consolidated financial statements contained in part ii , item 8. of this report for a reconciliation of total `` segment operating income `` to `` income before income tax . `` ( 2 ) see reconciliation to gaap , contained in part ii , item 6 . `` supplemental non-gaap financial measures . `` for the year ended december 31 , 2020 , net sales and comparable sales decreased primarily from lower demand due to covid-19 impacts . the p owera acquisition added $ 5.8 million . kensington ® and trusens ® branded products had strong sales growth . back-to-school sales for the year were approximately 9.0 percent below 2019 primarily due to a reduction in the total back-to-school market as a result of the pandemic . in addition , sales of private label products and sales to certain retailers decreased . we experienced more severe covid-19 impacts in our commercial product lines while sales to mass/retail customers decreased mainly due to lower back-to-school sales . unfavorable foreign exchange reduced net sales $ 1.0 million , or 0.1 percent . for the year ended december 31 , 2020 , o perating income and operating margin decreased primarily due to lower sales related to covid-19 impacts , cost inflation , inefficiencies related to lower volume , unfavorable customer and product mix , and increased reserves for bad debts . restructuring charges were $ 7.6 million versus $ 5.6 million in the prior year . partially offsetting these items were cost reductions , and $ 1.7 million in canadian government assistance , primarily provided in return for

debt recent amendments on may 1 , 2020 , the company entered into a third amendment ( the `` third amendment '' ) to the credit agreement ( the `` credit agreement '' ) , dated as of january 27 , 2017 , among the company , certain subsidiaries of the company , bank of america , n.a. , as administrative agent , and the other lenders party thereto . pursuant to the third amendment , the credit agreement was amended to , among other things : increase the maximum consolidated leverage ratio ( as defined in the credit agreement , as amended ) from 3.75:1.00 to 4.75:1.00 , stepping back down to 3.75:1.00 for the first fiscal quarter ending after june 30 , 2021 ; amend the pricing based on the company 's consolidated leverage ratio , with a scaled increase in fees , effective may 1 , 2020 : reduce the company 's capacity to incur certain other indebtedness , and impose additional limitations on certain restricted payments ( other than dividends ) and permitted acquisitions ; and 38 require that the company pay down any amounts on the revolving facility when cash and cash equivalents of the loan parties exceed $ 100.0 million . in connection with the powera acquisition , effective november 10 , 2020 , the company entered into a fourth amendment ( the `` fourth amendment '' ) to the credit agreement , among the company , certain subsidiaries of the company , bank of america , n.a. , as administrative agent , and the other lenders party thereto . pursuant to the fourth amendment , the credit agreement was amended to , among other things : provide flexibility under the permitted acquisition provisions to accommodate the acquisition of powera ; further amend the maximum consolidated leverage ratio financial covenant by 0.50:1.00 from current levels for each of the six fiscal quarters beginning march 31 , 2021 and ending june 30 , 2022 , as follows : replace_table_token_12_th exempt the borrowings made under the credit agreement , as amended , to fund the powera acquisition from the credit agreement 's anti-cash hoarding clause .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```debt recent amendments on may 1 , 2020 , the company entered into a third amendment ( the `` third amendment '' ) to the credit agreement ( the `` credit agreement '' ) , dated as of january 27 , 2017 , among the company , certain subsidiaries of the company , bank of america , n.a. , as administrative agent , and the other lenders party thereto . pursuant to the third amendment , the credit agreement was amended to , among other things : increase the maximum consolidated leverage ratio ( as defined in the credit agreement , as amended ) from 3.75:1.00 to 4.75:1.00 , stepping back down to 3.75:1.00 for the first fiscal quarter ending after june 30 , 2021 ; amend the pricing based on the company 's consolidated leverage ratio , with a scaled increase in fees , effective may 1 , 2020 : reduce the company 's capacity to incur certain other indebtedness , and impose additional limitations on certain restricted payments ( other than dividends ) and permitted acquisitions ; and 38 require that the company pay down any amounts on the revolving facility when cash and cash equivalents of the loan parties exceed $ 100.0 million . in connection with the powera acquisition , effective november 10 , 2020 , the company entered into a fourth amendment ( the `` fourth amendment '' ) to the credit agreement , among the company , certain subsidiaries of the company , bank of america , n.a. , as administrative agent , and the other lenders party thereto . pursuant to the fourth amendment , the credit agreement was amended to , among other things : provide flexibility under the permitted acquisition provisions to accommodate the acquisition of powera ; further amend the maximum consolidated leverage ratio financial covenant by 0.50:1.00 from current levels for each of the six fiscal quarters beginning march 31 , 2021 and ending june 30 , 2022 , as follows : replace_table_token_12_th exempt the borrowings made under the credit agreement , as amended , to fund the powera acquisition from the credit agreement 's anti-cash hoarding clause . ``` Suspicious Activity Report : as a result , our foreign businesses contributed over half of our sales in 2020 , up from 43 percent in 2016. our most recent acquisition of powera in late 2020 is about accelerating growth and entering into an attractive consumer product adjacency of third-party video game controllers , power charging stations , and headsets . the addition of powera will meaningfully improve our organic sales growth and profitability and increase our presence in faster growing mass and e-commerce channels . powera is expected to provide strong double-digit sales growth in the u.s. , as well as opportunities for expansion internationally , particularly in europe . it greatly advances our strategic shift toward consumer , school and technology products as more than half of our sales will now come from these product categories , which offer faster growing 28 demand . on a pro forma basis , including full year powera sales for 2020 , computer and gaming products would represent approximately 22 percent of our sales . our leading product category positions provide the scale to invest in marketing and product innovation to drive profitable growth . we now expect to grow in mature markets in consumer , technology , and adjacent categories driven by new product development . we will also continue to grow in emerging markets once the impact of covid-19 subsides in latin america and parts of asia , the middle east , and eastern europe . in all of our markets , we see opportunities for sales growth through share gains , channel and geographic expansion , and product enhancements . we generate strong operating cash flow , and will continue to leverage our cost structure through acquisitions , synergies and productivity savings to drive long-term profit and operating cash flow improvement . overview of 2020 performance as used in this annual report on form 10-k , `` covid-19 impacts `` include the operational , financial , and other effects on acco brands , our customers and end users of our products , of school and business closures , work from home , remote and hybrid learning , government orders and manufacturing , distribution , supply chain and other disruptions resulting from covid-19 , and the actions acco brands , our customers and end users have taken in response to the pandemic , including actions we have taken to manage our inventory and credit risk under the circumstances . the covid-19 impacts on our business have varied and continue to vary significantly by geographic region and country depending upon a range of factors , including how seriously the pandemic is affecting public health in the country and whether and to what degree businesses and schools are open , the general seasonality of our business in that country , the nature and level of government support , and the channel structure . during 2020 , all segments were impacted by covid-19 , but emea experienced lower impacts and our international segment experienced , and continues to experience , the highest impacts , largely in latin america due to the seriousness of the pandemic and the dependence of our brazilian and mexican businesses on the sale of school products . many schools and offices in latin america have been closed since the onset of the pandemic and access to online learning is limited . in north america , following good sell-in of back-to-school products in the second quarter , our third quarter sales were adversely affected by weaker sell-out . our net sales declined $ 300.5 million , or 15.4 percent in 2020 primarily from covid-19 impacts . those impacts vary based upon the channel . replace_table_token_5_th operating income declined 42.7 percent , primarily due to the lower sales , partially offset by company-wide cost reductions and government assistance in certain countries , generally in return for maintaining employment , pay and benefits . foreign exchange had a minimal impact on sales . from a net profit perspective , foreign exchange was unfavorable by $ 0.8 million . operating cash inflow for 2020 was $ 119.2 million compared with last year 's operating cash inflow of $ 203.9 million . the $ 84.7 million year-over-year difference was due to lower net income . operating cash flow in 2020 was used to fund : ( in millions ) use of cash debt repayments $ 51.3 share repurchases 16.3 dividends 24.6 capital expenditures 15.3 increase in cash on hand 8.8 debt issuance cost 3.2 29 covid-19 impact covid-19 and the actions being taken by national , state and local governments , businesses , schools and others to address it ( including work from home , quarantines , travel restrictions , business and school closures , remote and hybrid learning , and cancellations of , and limitations on , public gatherings ) have caused and continue to cause significant disruptions to normal business operations and have had , and are expected to continue to have , significant adverse impacts on our customers and end-users worldwide . similarly , our business , sales , earnings , and results of operations have been and will continue to be materially adversely affected by these events , as well as the current and expected continued negative impact on the global economy . we expect that uncertainties regarding when the risks of the pandemic will subside and how geographies , distribution channels and consumer behaviors will evolve over time in response to the pandemic will continue . we expect the company to be in a stronger competitive position after the pandemic because of our strong brands , more diversified and healthier channels , investments in innovative products , solid financial position , and disciplined execution . we are assessing likely changes to consumer behavior post pandemic and will continue to adjust our business and product strategy to align with evolving consumer preferences . story_separator_special_tag selling , general and administrative expenses selling , general and administrative expenses ( `` sg & a `` ) include advertising , marketing , selling ( including commissions ) , research and development , customer service , depreciation related to assets outside the manufacturing and distribution processes , and all other general and administrative expenses outside the manufacturing and distribution functions ( e.g . , finance , human resources , information technology ) . for the year ended december 31 , 2020 , foreign exchange reduced sg & a $ 3.9 million , or 1.0 percent , and the acquisitions added $ 7.4 million , or 1.9 percent , including $ 4.4 million of integration and transaction costs . t he prior-year period included $ 2.3 million in integration costs related to prior acquisitions . excluding the acquisitions , integration and transaction costs , and foreign exchange , sg & a benefited from cost reductions and lower incentive accruals , partly offset by increases for bad debts . we received $ 5.2 million in governm ent assistance , primarily provided in return for maintaining employment and wages . for the year ended december 31 , 2020 , sg & a as a percentage of net sales increased , primarily due to lower net sales . restructuring charges for the year ended december 31 , 2020 , r estructuring charges were $ 10.9 million . costs associated with severance expense in north america were $ 6.2 million . the remainder of the severance charges were primarily in brazil , mexico , and australia . lease abandonment charges were $ 1.5 million related to facilities in north america . the prior-year charges were related to severance costs associated with changes in the operating structure of our north america and international segments . operating income for the year ended december 31 , 2020 , operating income decreased , primarily due to lower net sales from covid-19 impacts , which were partially offset by cost reductions . foreign exchange benefited operating income $ 1.5 million , or 0.8 percent . foroni contributed a loss of $ 2.7 million and powera added operating income of $ 0.4 million . interest expense and income for the year ended december 31 , 2020 , the decrease in interest expense was primarily due to lower average debt outstanding and lower interest rates on our variable rate debt . the decrease in interest income was primarily due to lower cash balances being held in brazil . other expense ( income ) , net other expense ( income ) , net was an expense of $ 1.6 million compared with income of $ 1.8 million in 2019. the increase in expense was primarily due to the higher foreign exchange loss in 2020 and a lower benefit from using our brazilian operating tax credits . income tax expense for the year ended december 31 , 2020 , we recorded income tax expense of $ 16.6 million on income before taxes of $ 78.6 million for an effective tax rate of 21.1 percent . the decrease in the effective rate versus 2019 was primarily due to an increase in reserves for uncertain tax positions in the prior year , the election to exclude high-taxed intangible income from the global intangible low-taxed income ( `` gilti `` ) computation , and beneficial adjustments to deferred taxes resulting from statutory tax rate changes . for the year ended december 31 , 2019 , the high effective tax rate was primarily due to $ 5.6 million in additional reserves for uncertain tax positions in connection with the brazil tax assessments that were recorded in the first quarter of 2019. see `` note 12. income taxes - brazil tax assessments `` to the condensed consolidated financial statements contained in part ii , item 8. of this report for additional details . 35 net income/diluted income per share for the year ended december 31 , 2020 , net income decreased primarily due to lower operating income . foreign exchange decreased net income $ 0.8 million , or 0.7 percent . diluted income per share benefited from fewer outstanding shares . segment net sales and operating income for the years ended december 31 , 2020 and 2019 acco brands north america replace_table_token_8_th ( 1 ) segment operating income excludes corporate costs . see `` note 18. information on business segments `` to the consolidated financial statements contained in part ii , item 8. of this report for a reconciliation of total `` segment operating income `` to `` income before income tax . `` ( 2 ) see reconciliation to gaap , contained in part ii , item 6 . `` supplemental non-gaap financial measures . `` for the year ended december 31 , 2020 , net sales and comparable sales decreased primarily from lower demand due to covid-19 impacts . the p owera acquisition added $ 5.8 million . kensington ® and trusens ® branded products had strong sales growth . back-to-school sales for the year were approximately 9.0 percent below 2019 primarily due to a reduction in the total back-to-school market as a result of the pandemic . in addition , sales of private label products and sales to certain retailers decreased . we experienced more severe covid-19 impacts in our commercial product lines while sales to mass/retail customers decreased mainly due to lower back-to-school sales . unfavorable foreign exchange reduced net sales $ 1.0 million , or 0.1 percent . for the year ended december 31 , 2020 , o perating income and operating margin decreased primarily due to lower sales related to covid-19 impacts , cost inflation , inefficiencies related to lower volume , unfavorable customer and product mix , and increased reserves for bad debts . restructuring charges were $ 7.6 million versus $ 5.6 million in the prior year . partially offsetting these items were cost reductions , and $ 1.7 million in canadian government assistance , primarily provided in return for

the company built upon this momentum , generating revenue growth of 8.3 % during the first nine months of fiscal 2020 , accompanied by growth in its customer files , reflecting the strength of its family of brands , its focus on technological innovation and product development , and most importantly , providing an exemplary customer experience . the company was able to leverage its business platform as this growth rate accelerated with the onset of the covid-19 pandemic , during which time we saw customers increasingly turn to our brands and product offerings to help them remain connected and express themselves during this difficult time . as a result , consolidated annual revenue grew 19.3 % , to approximately $ 1.5 billion during fiscal 2020 , while net income increased 69.7 % , to $ 59.0 million . adjusted ebitda , which excludes the impact of stock-based compensation , non-qualified plan investment appreciation/depreciation , the costs of closing our harry & david retail stores , and personalizationmall litigation and transaction costs , increased 57.8 % , to $ 129.5 million . covid-19 impact in response to the global pandemic , the company has taken actions to ensure employee safety and business continuity , informed by the guidelines set forth by local , state and federal government and health officials . these initiatives include developing a “ pandemic preparedness and response plan , ” establishing an internal “ nerve center ” to allow for communication and coordination throughout the business , designing workstream teams to promote workforce protection and supply chain management , and dedicating resources to support customers , vendors , franchisees , and our bloomnet member florists . the covid-19 pandemic has affected , and will continue to affect , our operations and financial results for the foreseeable future . while there is significant uncertainty in the overall consumer environment due to the covid-19 crisis , we are seeing strong e-commerce demand for gourmet foods and gift baskets and our floral products for holidays and every-day gifting occasions , as well as for self-consumption . entering the company 's fiscal fourth quarter , immediately following the onset of the pandemic , we saw significantly increased demand during the easter holiday period , through mother 's day , and then continuing with “ everyday ” volume through the end of the fiscal year . as we look past the end of fiscal 2020 , demand trends remain strong through the first quarter of fiscal 2021. with that said , there are headwinds ( and resulting increased costs ) that have been , and will continue to impact our operations during the foreseeable future , including the following : ● retail store closures – on march 20 , 2020 , in response to government actions , and for the safety of its employees , the company temporarily closed its cheryl 's and harry & david retail stores . affected employees were provided with company paid special covid leave pay through april 3rd , as the nation and the company worked to understand the extent and potential length of the crisis . on april 14th , the difficult decision was made to permanently close 38 of our 39 harry & david retail stores . as a result , the company incurred a charge of approximately $ 5.2 million in our fourth quarter for lease obligations , employee costs and other store closure costs . annual revenues attributable to the closed locations was approximately $ 33.0 million . ● wholesale volume reductions - we have seen a reduction in our wholesale business as a result of covid-19 , which impacted our fourth quarter results within our bloomnet and gourmet foods and gift baskets segments as these customers were forced to close during the pandemic , resulting in loss of revenues , as well as increased reserves on certain customer receivables . we anticipate that this reduction in wholesale volume will continue through the fiscal second quarter of fiscal 2021 , as many of our large wholesale customers are taking a cautious approach due to the uncertainty surrounding the future impact of covid-19 on the overall consumer economy , and store based retail sales in particular . ● bloomnet membership fee reductions - we waived certain bloomnet membership fees in april 2020 to help them weather the covid-19 crisis . ● increased operating costs - we are seeing increased costs associated with the changes we have made , and continue to make , to our manufacturing , warehouse and distribution facilities to provide for the safety and wellbeing of our associates , including , among others : required social distancing , enhanced facility cleaning and sanitizing schedules , and staggered production shifts . ● personalizationmall litigation – on february 14 , 2020 , the company entered into an equity purchase agreement to acquire personalizationmall for $ 252.0 million from bed bath & beyond inc. the company originally expected the acquisition to close on march 30 , 2020. however , due to the unprecedented circumstances created by the covid-19 pandemic , the company requested a reasonable delay in the closing date as it believed that conditions to closing the transaction had not been met , including the shut-down of personalizationmall 's facilities . the seller responded to this request by filing a lawsuit in the court of chancery in the state of delaware on april 1 , 2020 , seeking a judgment forcing the company to close . on july 20 , 2020 , the company entered into a settlement agreement with respect to the litigation and an amendment to the equity purchase agreement , which reflects , among other things , an amended purchase price of $ 245.0 million . the transaction closed on august 3 , 2020. the company incurred approximately $ 2.7mm of related litigation and transaction costs during fiscal 2020 . 19 the scale and overall economic impact of the covid-19 crisis is still very difficult to assess . story_separator_special_tag wholesale/retail volume , which had been trending significantly favorable to prior year before the onset of covid-19 , ended relatively flat for the year due to the closure of many of the brand 's retail customer 's stores , and the closure of the harry & david retail store operations in the 4 th quarter . net revenues increased 7.1 % during fiscal 2019 , attributable to growth from nearly all brands , but primarily due to : ( i ) strong growth from harry & david , driven by improved merchandising assortments , increased investments in digital marketing programs , and its “ share more ” messaging , which resonated with customers , contributing to new customer acquisition and increases in its “ everyday ” business , and ( ii ) as 1-800-baskets/designpac , which generated year-over-year growth from new and existing wholesale customers , as well through its e-commerce business attributable to its simply chocolate product line . 24 gross profit replace_table_token_8_th gross profit consists of net revenues less cost of revenues , which is comprised primarily of florist fulfillment costs ( fees paid directly to florists ) , the cost of floral and non-floral merchandise sold from inventory or through third parties , and associated costs including inbound and outbound shipping charges . additionally , cost of revenues includes labor and facility costs related to direct-to-consumer and wholesale production operations . gross profit increased 18.3 % during fiscal 2020 due to the increase in revenues noted above , partially offset by a lower gross profit percentage . gross profit percentage decreased 30 basis points during fiscal 2020 , due to lower margins within the gourmet foods & gift baskets and bloomnet segments , partially offset by improved margins in the consumer floral segment . the lower margins were attributable to the acquisition of shari 's berries , which carries a lower gross margin , and macro-economic headwinds including : ( i ) rising labor and transportation costs , ( ii ) tariffs , and ( iii ) increased costs associated with the changes we have made , and continue to make , to our manufacturing , warehouse and distribution facilities to provide for the safety and wellbeing of our associates in light of covid-19 , including : required social distancing , enhanced facility cleaning and sanitizing schedules , and staggered production shifts . these headwinds have been partially offset by the company 's strategic pricing initiatives and operational productivity improvements . gross profit increased 7.6 % during fiscal 2019 due to the increase in revenues noted above , partially offset by a lower gross profit percentage . gross profit decreased 40 basis points during fiscal 2019 , reflecting bloomnet 's lower gross margin percentage , as well as hourly labor , particularly seasonal labor , and the growth of our celebrations passport free-shipping program , partially offset by gourmet foods & gift baskets logistics initiatives , which reduced per order transportation costs , as well as manufacturing initiatives , including automation and shifting some production to earlier in the season to better utilize our core workforce . consumer floral segment – gross profit increased 19.9 % during fiscal 2020 , due to the aforementioned revenue growth and an increase in gross profit percentage of 20 basis points to 39.4 % . the higher gross profit percentage reflects lower promotional activity throughout the year due to the elimination of the loyalty points program , instead emphasizing “ passport ” to increase purchase frequency . gross profit increased 7.4 % during fiscal 2019 , due to the aforementioned revenue growth , partially offset by a decrease in gross profit percentage of 50 basis points to 39.2 % . the lower gross profit percentage reflects higher product costs , an increased celebrations passport program participation , which has been driving improved customer loyalty and purchase frequency , and increased transportation costs . bloomnet segment - gross profit increased 4.3 % during fiscal 2020 , due to the increase in revenues noted above , partially offset by a decrease in gross profit percentage of 200 basis points to 48.5 % . the lower gross profit percentage was due to unfavorable wholesale product margins due to the impact of tariffs , promotional offerings and higher shipping and merchandise costs , as well as higher rebates ( higher florist-to-florist volume ) and the aforementioned fee waivers in april 2020 to assist the florist network during the onset of the pandemic . gross profit increased 6.9 % during fiscal 2019 , due to the increase in revenues noted above , partially offset by a decrease in gross profit percentage of 380 basis points to 50.5 % . the lower gross profit percentage is due to the increase in the volume of lower margin florist-to-florist orders , on membership and transaction fee margins , as a result of an increase in rebates to support the brand 's efforts to gain market share . gourmet foods & gift baskets segment – gross profit increased by 20.0 % during fiscal 2020 , due to the increase in revenues noted above , partially offset by a decrease in gross profit percentage of 40 basis points to 42.5 % , mainly due to the acquisition of shari 's berries , which carries a lower gross margin than the rest of the segment , as well as the aforementioned macro-economic headwinds and incremental covid-19 costs . gross profit increased by 7.9 % during fiscal 2019 , due to the increase in revenues noted above , as well as increased margins . gross profit percentage increased 30 basis points to 42.9 % during fiscal 2019 , due to logistics initiatives , which reduced shipping and transportation costs , combined with strategic pricing initiatives , and improved operational performance at cheryl 's , partially offset by rising labor costs , and penetration of the celebrations passport program . marketing and sales expense replace_table_token_9_th marketing and sales expense consists primarily of advertising and

liquidity and capital resources liquidity and borrowings the company 's principal sources of liquidity are cash on hand , cash flows generated from operations and borrowings available under the 2019 credit agreement ( see note 18. in part iv , item 15 for details ) . at june 28 , 2020 , the company had working capital of $ 198.3 million , including cash and cash equivalents of $ 240.5 million , compared to working capital of $ 175.4 million , including cash and cash equivalents of $ 172.9 million at june 30 , 2019. as of june 28 , 2020 , there were no borrowings outstanding under the company 's revolver . due to the seasonal nature of the company 's business , and its continued expansion into non-floral products , the thanksgiving through christmas holiday season , which falls within the company 's second fiscal quarter , historically generated nearly 50 % of the company 's annual revenues , and all of its earnings . however , with the onset of the covid-19 pandemic , the company experienced a significant increase in its revenues and earnings during its fourth quarter of fiscal 2020. these trends have continued through the first two months of its fiscal 2021 first quarter . our customers have increasingly turned to our brands and our expanded product offerings to help them connect and express themselves during the recent covid-19 pandemic and our “ everyday ” gifting product line has seen increased volume . while the continuing impacts of covid-19 are difficult to predict , the company expects that its fiscal second quarter will continue to be its largest in terms of revenues and earnings , although increases in the company 's “ everyday ” business have and are expected to continue to lessen the seasonality of our business .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```liquidity and capital resources liquidity and borrowings the company 's principal sources of liquidity are cash on hand , cash flows generated from operations and borrowings available under the 2019 credit agreement ( see note 18. in part iv , item 15 for details ) . at june 28 , 2020 , the company had working capital of $ 198.3 million , including cash and cash equivalents of $ 240.5 million , compared to working capital of $ 175.4 million , including cash and cash equivalents of $ 172.9 million at june 30 , 2019. as of june 28 , 2020 , there were no borrowings outstanding under the company 's revolver . due to the seasonal nature of the company 's business , and its continued expansion into non-floral products , the thanksgiving through christmas holiday season , which falls within the company 's second fiscal quarter , historically generated nearly 50 % of the company 's annual revenues , and all of its earnings . however , with the onset of the covid-19 pandemic , the company experienced a significant increase in its revenues and earnings during its fourth quarter of fiscal 2020. these trends have continued through the first two months of its fiscal 2021 first quarter . our customers have increasingly turned to our brands and our expanded product offerings to help them connect and express themselves during the recent covid-19 pandemic and our “ everyday ” gifting product line has seen increased volume . while the continuing impacts of covid-19 are difficult to predict , the company expects that its fiscal second quarter will continue to be its largest in terms of revenues and earnings , although increases in the company 's “ everyday ” business have and are expected to continue to lessen the seasonality of our business . ``` Suspicious Activity Report : the company built upon this momentum , generating revenue growth of 8.3 % during the first nine months of fiscal 2020 , accompanied by growth in its customer files , reflecting the strength of its family of brands , its focus on technological innovation and product development , and most importantly , providing an exemplary customer experience . the company was able to leverage its business platform as this growth rate accelerated with the onset of the covid-19 pandemic , during which time we saw customers increasingly turn to our brands and product offerings to help them remain connected and express themselves during this difficult time . as a result , consolidated annual revenue grew 19.3 % , to approximately $ 1.5 billion during fiscal 2020 , while net income increased 69.7 % , to $ 59.0 million . adjusted ebitda , which excludes the impact of stock-based compensation , non-qualified plan investment appreciation/depreciation , the costs of closing our harry & david retail stores , and personalizationmall litigation and transaction costs , increased 57.8 % , to $ 129.5 million . covid-19 impact in response to the global pandemic , the company has taken actions to ensure employee safety and business continuity , informed by the guidelines set forth by local , state and federal government and health officials . these initiatives include developing a “ pandemic preparedness and response plan , ” establishing an internal “ nerve center ” to allow for communication and coordination throughout the business , designing workstream teams to promote workforce protection and supply chain management , and dedicating resources to support customers , vendors , franchisees , and our bloomnet member florists . the covid-19 pandemic has affected , and will continue to affect , our operations and financial results for the foreseeable future . while there is significant uncertainty in the overall consumer environment due to the covid-19 crisis , we are seeing strong e-commerce demand for gourmet foods and gift baskets and our floral products for holidays and every-day gifting occasions , as well as for self-consumption . entering the company 's fiscal fourth quarter , immediately following the onset of the pandemic , we saw significantly increased demand during the easter holiday period , through mother 's day , and then continuing with “ everyday ” volume through the end of the fiscal year . as we look past the end of fiscal 2020 , demand trends remain strong through the first quarter of fiscal 2021. with that said , there are headwinds ( and resulting increased costs ) that have been , and will continue to impact our operations during the foreseeable future , including the following : ● retail store closures – on march 20 , 2020 , in response to government actions , and for the safety of its employees , the company temporarily closed its cheryl 's and harry & david retail stores . affected employees were provided with company paid special covid leave pay through april 3rd , as the nation and the company worked to understand the extent and potential length of the crisis . on april 14th , the difficult decision was made to permanently close 38 of our 39 harry & david retail stores . as a result , the company incurred a charge of approximately $ 5.2 million in our fourth quarter for lease obligations , employee costs and other store closure costs . annual revenues attributable to the closed locations was approximately $ 33.0 million . ● wholesale volume reductions - we have seen a reduction in our wholesale business as a result of covid-19 , which impacted our fourth quarter results within our bloomnet and gourmet foods and gift baskets segments as these customers were forced to close during the pandemic , resulting in loss of revenues , as well as increased reserves on certain customer receivables . we anticipate that this reduction in wholesale volume will continue through the fiscal second quarter of fiscal 2021 , as many of our large wholesale customers are taking a cautious approach due to the uncertainty surrounding the future impact of covid-19 on the overall consumer economy , and store based retail sales in particular . ● bloomnet membership fee reductions - we waived certain bloomnet membership fees in april 2020 to help them weather the covid-19 crisis . ● increased operating costs - we are seeing increased costs associated with the changes we have made , and continue to make , to our manufacturing , warehouse and distribution facilities to provide for the safety and wellbeing of our associates , including , among others : required social distancing , enhanced facility cleaning and sanitizing schedules , and staggered production shifts . ● personalizationmall litigation – on february 14 , 2020 , the company entered into an equity purchase agreement to acquire personalizationmall for $ 252.0 million from bed bath & beyond inc. the company originally expected the acquisition to close on march 30 , 2020. however , due to the unprecedented circumstances created by the covid-19 pandemic , the company requested a reasonable delay in the closing date as it believed that conditions to closing the transaction had not been met , including the shut-down of personalizationmall 's facilities . the seller responded to this request by filing a lawsuit in the court of chancery in the state of delaware on april 1 , 2020 , seeking a judgment forcing the company to close . on july 20 , 2020 , the company entered into a settlement agreement with respect to the litigation and an amendment to the equity purchase agreement , which reflects , among other things , an amended purchase price of $ 245.0 million . the transaction closed on august 3 , 2020. the company incurred approximately $ 2.7mm of related litigation and transaction costs during fiscal 2020 . 19 the scale and overall economic impact of the covid-19 crisis is still very difficult to assess . story_separator_special_tag wholesale/retail volume , which had been trending significantly favorable to prior year before the onset of covid-19 , ended relatively flat for the year due to the closure of many of the brand 's retail customer 's stores , and the closure of the harry & david retail store operations in the 4 th quarter . net revenues increased 7.1 % during fiscal 2019 , attributable to growth from nearly all brands , but primarily due to : ( i ) strong growth from harry & david , driven by improved merchandising assortments , increased investments in digital marketing programs , and its “ share more ” messaging , which resonated with customers , contributing to new customer acquisition and increases in its “ everyday ” business , and ( ii ) as 1-800-baskets/designpac , which generated year-over-year growth from new and existing wholesale customers , as well through its e-commerce business attributable to its simply chocolate product line . 24 gross profit replace_table_token_8_th gross profit consists of net revenues less cost of revenues , which is comprised primarily of florist fulfillment costs ( fees paid directly to florists ) , the cost of floral and non-floral merchandise sold from inventory or through third parties , and associated costs including inbound and outbound shipping charges . additionally , cost of revenues includes labor and facility costs related to direct-to-consumer and wholesale production operations . gross profit increased 18.3 % during fiscal 2020 due to the increase in revenues noted above , partially offset by a lower gross profit percentage . gross profit percentage decreased 30 basis points during fiscal 2020 , due to lower margins within the gourmet foods & gift baskets and bloomnet segments , partially offset by improved margins in the consumer floral segment . the lower margins were attributable to the acquisition of shari 's berries , which carries a lower gross margin , and macro-economic headwinds including : ( i ) rising labor and transportation costs , ( ii ) tariffs , and ( iii ) increased costs associated with the changes we have made , and continue to make , to our manufacturing , warehouse and distribution facilities to provide for the safety and wellbeing of our associates in light of covid-19 , including : required social distancing , enhanced facility cleaning and sanitizing schedules , and staggered production shifts . these headwinds have been partially offset by the company 's strategic pricing initiatives and operational productivity improvements . gross profit increased 7.6 % during fiscal 2019 due to the increase in revenues noted above , partially offset by a lower gross profit percentage . gross profit decreased 40 basis points during fiscal 2019 , reflecting bloomnet 's lower gross margin percentage , as well as hourly labor , particularly seasonal labor , and the growth of our celebrations passport free-shipping program , partially offset by gourmet foods & gift baskets logistics initiatives , which reduced per order transportation costs , as well as manufacturing initiatives , including automation and shifting some production to earlier in the season to better utilize our core workforce . consumer floral segment – gross profit increased 19.9 % during fiscal 2020 , due to the aforementioned revenue growth and an increase in gross profit percentage of 20 basis points to 39.4 % . the higher gross profit percentage reflects lower promotional activity throughout the year due to the elimination of the loyalty points program , instead emphasizing “ passport ” to increase purchase frequency . gross profit increased 7.4 % during fiscal 2019 , due to the aforementioned revenue growth , partially offset by a decrease in gross profit percentage of 50 basis points to 39.2 % . the lower gross profit percentage reflects higher product costs , an increased celebrations passport program participation , which has been driving improved customer loyalty and purchase frequency , and increased transportation costs . bloomnet segment - gross profit increased 4.3 % during fiscal 2020 , due to the increase in revenues noted above , partially offset by a decrease in gross profit percentage of 200 basis points to 48.5 % . the lower gross profit percentage was due to unfavorable wholesale product margins due to the impact of tariffs , promotional offerings and higher shipping and merchandise costs , as well as higher rebates ( higher florist-to-florist volume ) and the aforementioned fee waivers in april 2020 to assist the florist network during the onset of the pandemic . gross profit increased 6.9 % during fiscal 2019 , due to the increase in revenues noted above , partially offset by a decrease in gross profit percentage of 380 basis points to 50.5 % . the lower gross profit percentage is due to the increase in the volume of lower margin florist-to-florist orders , on membership and transaction fee margins , as a result of an increase in rebates to support the brand 's efforts to gain market share . gourmet foods & gift baskets segment – gross profit increased by 20.0 % during fiscal 2020 , due to the increase in revenues noted above , partially offset by a decrease in gross profit percentage of 40 basis points to 42.5 % , mainly due to the acquisition of shari 's berries , which carries a lower gross margin than the rest of the segment , as well as the aforementioned macro-economic headwinds and incremental covid-19 costs . gross profit increased by 7.9 % during fiscal 2019 , due to the increase in revenues noted above , as well as increased margins . gross profit percentage increased 30 basis points to 42.9 % during fiscal 2019 , due to logistics initiatives , which reduced shipping and transportation costs , combined with strategic pricing initiatives , and improved operational performance at cheryl 's , partially offset by rising labor costs , and penetration of the celebrations passport program . marketing and sales expense replace_table_token_9_th marketing and sales expense consists primarily of advertising and

while the 2011 prices of wti crude oil rose almost 20 % compared to the prior year , crude oil sold based on other worldwide benchmark prices , such as brent and tapis , rose even more than wti in that year . the 2011 rise in prices of wti crude oil , which is only used as a benchmark in north america , was held back compared to other worldwide benchmark price increases due to a somewhat temporary crude oil dislocation discount and a bit of supply/demand disparity in the continental u.s. during 2011. the disparity between crude oil and natural gas prices in north america continued to widen during both 2012 and 2011 on an energy equivalent basis due to gas production growth that exceeded demand . u.s. crude oil prices in early 2013 have been similar to 2012 average prices , while natural gas prices in north america in 2013 have thus far been slightly above the 2012 levels due to cold temperatures across much of the northern u.s. during the early winter season . 27 results of operations murphy oil 's results of operations , with associated diluted earnings per share ( eps ) , for the last three years are presented in the following table . replace_table_token_13_th murphy oil 's net income in 2012 increased 11 % compared to 2011 primarily due to higher earnings for continuing exploration and production ( e & p ) operations , partially offset by lower earnings for continuing refining and marketing operations ( r & m ) , lower income from discontinued operations , and higher net costs of corporate activities that were not allocated to operating segments . net income in 2011 was 9 % higher than 2010 , with the improvement primarily attributable to better earnings for r & m continuing operations , higher income from discontinued operations , which was essentially attributable to strong u.s. refining results prior to sale of these assets , and lower net costs for corporate activities . lower e & p earnings for continuing operations in 2011 , primarily associated with a large impairment charge in republic of the congo , somewhat offset these favorable results in other areas . further explanations of each of these variances are found in more detail in the following sections . 2012 vs. 2011 – net income in 2012 was $ 970.9 million ( $ 4.99 per diluted share ) compared to $ 872.7 million ( $ 4.49 per diluted share ) in 2011. income from continuing operations was $ 964.1 million ( $ 4.95 per diluted share ) in 2012 , up from $ 729.5 million ( $ 3.75 per diluted share ) in 2011. earnings for 2012 increased primarily due to a combination of lower impairment charges , income tax benefits , higher crude oil sales volumes , lower exploration expenses and higher u.k. r & m earnings . these were partially offset by lower north american natural gas sales prices , lower u.s. retail marketing margins , and unfavorable effects of foreign exchange compared to the prior year . net income in 2012 and 2011 included income from discontinued operations of $ 6.8 million ( $ 0.04 per diluted share ) and $ 143.2 million ( $ 0.74 per diluted share ) , respectively . the stronger results for discontinued operations in 2011 were primarily associated with operating income and a net gain on disposal of two u.s. refineries ( meraux , louisiana and superior , wisconsin ) and associated marketing assets which were sold in 2011. by business unit , e & p income from continuing operations improved $ 290.8 million in 2012 , primarily due to higher crude oil production , lower impairment expense in republic of the congo , income tax benefits associated with exploration activities in republic of the congo and suriname , and lower exploration expenses . e & p operating results were unfavorably affected in 2012 compared to the prior year by lower north american natural gas sales prices and higher expenses for production , depreciation and administration . income from r & m continuing operations was $ 32.7 million lower in 2012 , with the reduction mostly attributable to lower earnings , including an impairment charge , for u.s. ethanol production operations , plus lower u.s. retail fuel margins , with these more than offsetting significantly better u.k. refining margins in the current year . the net costs of corporate activities were higher by $ 23.5 million in 2012 , mostly attributable to unfavorable effects of transactions denominated in foreign currencies . to a lesser degree , the 2012 corporate net costs were unfavorably affected by lower interest income and higher administrative expenses . sales and other operating revenues grew $ 1.0 billion in 2012 compared to 2011 due to higher crude oil sales volumes for the e & p business , plus slightly larger sales volumes for both the u.s. and u.k. r & m continuing operations . gain ( loss ) on sale of assets was $ 23.9 million less in 2012 than 2011 because the earlier year 28 included a $ 23.1 million gain on sale of natural gas storage assets in spain . interest and other operating income was unfavorable by $ 22.0 million in 2012 compared to 2011 mostly due to an $ 18.4 million unfavorable pretax variance from the effects of transactions denominated in foreign currencies , plus interest income in 2011 of $ 2.7 million associated with a recovery of federal royalties for certain deepwater gulf of mexico fields . story_separator_special_tag natural gas sales volumes for continuing operations increased 29 % in 2011 and the improvement was primarily attributable to higher gas volumes produced during 2011 at the tupper west area in western canada following start-up in the first quarter of the year . natural gas sales volumes also improved in 2011 at the tupper area in canada and at fields offshore sarawak ; both of these areas had active development programs during 2011. natural gas sales volumes were lower during 2011 at the kikeh field principally due to less volumes produced because of mechanical issues with wells . the results of operations for oil and gas producing activities for each of the last three years are shown by major operating areas on pages f-51 and f-52 of this form 10-k report . average daily production and sales rates and weighted average sales prices are shown on page 5 of the 2012 annual report . a summary of oil and gas revenues , including intersegment sales that are eliminated in the consolidated financial statements , is presented in the following table . replace_table_token_15_th the company 's total crude oil , condensate and natural gas liquids production averaged 112,591 barrels per day in 2012 , compared to 103,160 barrels per day in 2011 and 126,927 barrels per day in 2010 . 32 united states crude oil production averaged 26,090 barrels per day in 2012 , an annual record for the company in the u.s. , and an increase from 17,148 barrels per day in 2011. the u.s. increase was primarily attributable to an ongoing development drilling program in the eagle ford shale area in south texas . heavy oil production in the western canada sedimentary basin of 7,241 barrels per day in 2012 was about flat with 2011. crude oil production offshore canada fell from 9,204 barrels per day in 2011 to 6,986 barrels per day in 2012 essentially due to more downtime for maintenance at the terra nova field and well decline at the hibernia field . synthetic oil production of 13,830 barrels per day in 2012 slightly exceeded 2011 volumes of 13,498 per day . crude oil and liquids production in malaysia averaged 52,663 barrels per day in 2012 , up from 48,551 barrels per day in 2011 , with the increase mainly due to additional wells brought on production at the kikeh field . oil production in republic of the congo fell to 2,078 barrels per day in 2012 after averaging 4,989 barrels per day in 2011 , with the reduction due to a well that went off production during 2012 and normal decline at other wells in the field . crude oil production in the u.k. was 3,458 barrels per day in 2012 compared to 2,423 barrels per day in 2011. the u.k. increase in 2012 was primarily at schiehallion , where better overall performance more than offset lower volumes at mungo/monan . expected sales of all u.k. oil and natural gas operations in early 2013 led the company to report these u.k. e & p activities as discontinued operations for all periods presented in the consolidated financial statements . united states oil production decreased from 20,114 barrels per day in 2010 to 17,148 barrels per day in 2011 with the lower volumes mostly caused by field decline at thunder hawk that was primarily due to a delay in development drilling operations in 2010 and 2011 following the macondo incident in april 2010. the production decline at thunder hawk was partially offset by higher oil volumes produced in 2011 at the eagle ford shale area in south texas . production of heavy oil in western canada was 7,264 barrels per day in 2011 , up from 5,988 barrels per day in 2010 , primarily due to ongoing drilling operations at the seal area in alberta . oil production offshore canada fell from 11,497 barrels per day in 2010 to 9,204 barrels per day in 2011 primarily due to field decline at terra nova and a reduction of the company 's working interest at this field from 12.0 % in 2010 to 10.475 % in 2011. synthetic oil operations at syncrude had net production of 13,498 barrels per day in 2011 , up from 13,273 barrels per day in 2010 , with the increase caused by a lower royalty rate in 2011 due to higher costs incurred for the operations . oil production in malaysia decreased from 66,897 barrels per day in 2010 to 48,551 barrels per day in 2011 , primarily due to lower production at the kikeh field . mechanical issues at kikeh led to certain wells being down for a portion of 2011. oil production in malaysia was favorably affected in 2011 by higher condensate and other gas liquids produced at gas fields offshore sarawak . the azurite field offshore republic of the congo averaged 4,989 barrels per day in 2011 , down from 5,820 barrels per day in 2010 due to faster than expected well decline . oil production from discontinued operations in the u.k. was 2,423 barrels per day in 2011 , down from 3,295 barrels per day in 2010 , with the decline primarily due to more downtime at the schiehallion and mungo/monan fields during the later year . worldwide sales of natural gas were a company record 490.1 million cubic feet ( mmcf ) per day in 2012 , after averaging 457.4 mmcf per day in 2011 and 356.8 mmcf per day in 2010. natural gas sales volumes in the u.s. were 53.0 mmcf per day in 2012 , up from 2011 production of 47.2 mmcf per day as higher production in the eagle ford shale area more than offset declines at fields in the gulf of mexico . natural gas volumes in western canada increased from 188.8 mmcf per day in 2011 to 217.0 mmcf per day in 2012 essentially due to higher gas volumes produced at the tupper area , as more wells were on production at tupper west during

cash flows operating activities – cash provided by operating activities was $ 3.06 billion in 2012 , $ 2.15 billion in 2011 and $ 3.13 billion in 2010. cash flows associated with formerly owned u.s. refineries and the held for sale u.k. oil and gas production business have been classified as discontinued operations in the company 's consolidated financial statements . cash provided by operating activities included cash from these discontinued operations of $ 61.1 million in 2012 , $ 185.5 million in 2011 and $ 159.5 million in 2010. cash provided by continuing operations in 2012 was $ 1.04 billion more than 2011 primarily due to a lower use of cash to build working capital other than cash , higher income from continuing operations in the current year , and higher non-cash expenses for depreciation and deferred taxes in 2012. cash provided by continuing operations in 2011 was 41 $ 1.01 billion less than 2010 primarily due to timing of cash collected and disbursed associated with changes in other working capital balances . cash was primarily used in 2011 to pay down accounts payable for crude oil feedstocks at formerly owned u.s. petroleum refineries and to pay income taxes in the u.s. and malaysia . cash flow from continuing operations in 2010 included cash receipts of $ 286.4 million related to recovery of u.s. federal royalties and associated interest income . the income associated with the royalty recovery was recorded in 2009 , but the cash proceeds were collected in early 2010. cash provided by operating activities was reduced by expenditures for abandonment of oil and gas properties totaling $ 40.4 million in 2012 , $ 21.5 million in 2011 and $ 36.5 million in 2010. operating cash flows were reduced by payments of income taxes of $ 567.0 million in 2012 , $ 938.9 million in 2011 and $ 585.8 million in 2010. the total reductions of operating cash flows for interest paid during the three years ended december 31 , 2012 , 2011 and 2010 were $ 48.7 million , $ 53.3 million and $ 53.9 million , respectively .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```cash flows operating activities – cash provided by operating activities was $ 3.06 billion in 2012 , $ 2.15 billion in 2011 and $ 3.13 billion in 2010. cash flows associated with formerly owned u.s. refineries and the held for sale u.k. oil and gas production business have been classified as discontinued operations in the company 's consolidated financial statements . cash provided by operating activities included cash from these discontinued operations of $ 61.1 million in 2012 , $ 185.5 million in 2011 and $ 159.5 million in 2010. cash provided by continuing operations in 2012 was $ 1.04 billion more than 2011 primarily due to a lower use of cash to build working capital other than cash , higher income from continuing operations in the current year , and higher non-cash expenses for depreciation and deferred taxes in 2012. cash provided by continuing operations in 2011 was 41 $ 1.01 billion less than 2010 primarily due to timing of cash collected and disbursed associated with changes in other working capital balances . cash was primarily used in 2011 to pay down accounts payable for crude oil feedstocks at formerly owned u.s. petroleum refineries and to pay income taxes in the u.s. and malaysia . cash flow from continuing operations in 2010 included cash receipts of $ 286.4 million related to recovery of u.s. federal royalties and associated interest income . the income associated with the royalty recovery was recorded in 2009 , but the cash proceeds were collected in early 2010. cash provided by operating activities was reduced by expenditures for abandonment of oil and gas properties totaling $ 40.4 million in 2012 , $ 21.5 million in 2011 and $ 36.5 million in 2010. operating cash flows were reduced by payments of income taxes of $ 567.0 million in 2012 , $ 938.9 million in 2011 and $ 585.8 million in 2010. the total reductions of operating cash flows for interest paid during the three years ended december 31 , 2012 , 2011 and 2010 were $ 48.7 million , $ 53.3 million and $ 53.9 million , respectively . ``` Suspicious Activity Report : while the 2011 prices of wti crude oil rose almost 20 % compared to the prior year , crude oil sold based on other worldwide benchmark prices , such as brent and tapis , rose even more than wti in that year . the 2011 rise in prices of wti crude oil , which is only used as a benchmark in north america , was held back compared to other worldwide benchmark price increases due to a somewhat temporary crude oil dislocation discount and a bit of supply/demand disparity in the continental u.s. during 2011. the disparity between crude oil and natural gas prices in north america continued to widen during both 2012 and 2011 on an energy equivalent basis due to gas production growth that exceeded demand . u.s. crude oil prices in early 2013 have been similar to 2012 average prices , while natural gas prices in north america in 2013 have thus far been slightly above the 2012 levels due to cold temperatures across much of the northern u.s. during the early winter season . 27 results of operations murphy oil 's results of operations , with associated diluted earnings per share ( eps ) , for the last three years are presented in the following table . replace_table_token_13_th murphy oil 's net income in 2012 increased 11 % compared to 2011 primarily due to higher earnings for continuing exploration and production ( e & p ) operations , partially offset by lower earnings for continuing refining and marketing operations ( r & m ) , lower income from discontinued operations , and higher net costs of corporate activities that were not allocated to operating segments . net income in 2011 was 9 % higher than 2010 , with the improvement primarily attributable to better earnings for r & m continuing operations , higher income from discontinued operations , which was essentially attributable to strong u.s. refining results prior to sale of these assets , and lower net costs for corporate activities . lower e & p earnings for continuing operations in 2011 , primarily associated with a large impairment charge in republic of the congo , somewhat offset these favorable results in other areas . further explanations of each of these variances are found in more detail in the following sections . 2012 vs. 2011 – net income in 2012 was $ 970.9 million ( $ 4.99 per diluted share ) compared to $ 872.7 million ( $ 4.49 per diluted share ) in 2011. income from continuing operations was $ 964.1 million ( $ 4.95 per diluted share ) in 2012 , up from $ 729.5 million ( $ 3.75 per diluted share ) in 2011. earnings for 2012 increased primarily due to a combination of lower impairment charges , income tax benefits , higher crude oil sales volumes , lower exploration expenses and higher u.k. r & m earnings . these were partially offset by lower north american natural gas sales prices , lower u.s. retail marketing margins , and unfavorable effects of foreign exchange compared to the prior year . net income in 2012 and 2011 included income from discontinued operations of $ 6.8 million ( $ 0.04 per diluted share ) and $ 143.2 million ( $ 0.74 per diluted share ) , respectively . the stronger results for discontinued operations in 2011 were primarily associated with operating income and a net gain on disposal of two u.s. refineries ( meraux , louisiana and superior , wisconsin ) and associated marketing assets which were sold in 2011. by business unit , e & p income from continuing operations improved $ 290.8 million in 2012 , primarily due to higher crude oil production , lower impairment expense in republic of the congo , income tax benefits associated with exploration activities in republic of the congo and suriname , and lower exploration expenses . e & p operating results were unfavorably affected in 2012 compared to the prior year by lower north american natural gas sales prices and higher expenses for production , depreciation and administration . income from r & m continuing operations was $ 32.7 million lower in 2012 , with the reduction mostly attributable to lower earnings , including an impairment charge , for u.s. ethanol production operations , plus lower u.s. retail fuel margins , with these more than offsetting significantly better u.k. refining margins in the current year . the net costs of corporate activities were higher by $ 23.5 million in 2012 , mostly attributable to unfavorable effects of transactions denominated in foreign currencies . to a lesser degree , the 2012 corporate net costs were unfavorably affected by lower interest income and higher administrative expenses . sales and other operating revenues grew $ 1.0 billion in 2012 compared to 2011 due to higher crude oil sales volumes for the e & p business , plus slightly larger sales volumes for both the u.s. and u.k. r & m continuing operations . gain ( loss ) on sale of assets was $ 23.9 million less in 2012 than 2011 because the earlier year 28 included a $ 23.1 million gain on sale of natural gas storage assets in spain . interest and other operating income was unfavorable by $ 22.0 million in 2012 compared to 2011 mostly due to an $ 18.4 million unfavorable pretax variance from the effects of transactions denominated in foreign currencies , plus interest income in 2011 of $ 2.7 million associated with a recovery of federal royalties for certain deepwater gulf of mexico fields . story_separator_special_tag natural gas sales volumes for continuing operations increased 29 % in 2011 and the improvement was primarily attributable to higher gas volumes produced during 2011 at the tupper west area in western canada following start-up in the first quarter of the year . natural gas sales volumes also improved in 2011 at the tupper area in canada and at fields offshore sarawak ; both of these areas had active development programs during 2011. natural gas sales volumes were lower during 2011 at the kikeh field principally due to less volumes produced because of mechanical issues with wells . the results of operations for oil and gas producing activities for each of the last three years are shown by major operating areas on pages f-51 and f-52 of this form 10-k report . average daily production and sales rates and weighted average sales prices are shown on page 5 of the 2012 annual report . a summary of oil and gas revenues , including intersegment sales that are eliminated in the consolidated financial statements , is presented in the following table . replace_table_token_15_th the company 's total crude oil , condensate and natural gas liquids production averaged 112,591 barrels per day in 2012 , compared to 103,160 barrels per day in 2011 and 126,927 barrels per day in 2010 . 32 united states crude oil production averaged 26,090 barrels per day in 2012 , an annual record for the company in the u.s. , and an increase from 17,148 barrels per day in 2011. the u.s. increase was primarily attributable to an ongoing development drilling program in the eagle ford shale area in south texas . heavy oil production in the western canada sedimentary basin of 7,241 barrels per day in 2012 was about flat with 2011. crude oil production offshore canada fell from 9,204 barrels per day in 2011 to 6,986 barrels per day in 2012 essentially due to more downtime for maintenance at the terra nova field and well decline at the hibernia field . synthetic oil production of 13,830 barrels per day in 2012 slightly exceeded 2011 volumes of 13,498 per day . crude oil and liquids production in malaysia averaged 52,663 barrels per day in 2012 , up from 48,551 barrels per day in 2011 , with the increase mainly due to additional wells brought on production at the kikeh field . oil production in republic of the congo fell to 2,078 barrels per day in 2012 after averaging 4,989 barrels per day in 2011 , with the reduction due to a well that went off production during 2012 and normal decline at other wells in the field . crude oil production in the u.k. was 3,458 barrels per day in 2012 compared to 2,423 barrels per day in 2011. the u.k. increase in 2012 was primarily at schiehallion , where better overall performance more than offset lower volumes at mungo/monan . expected sales of all u.k. oil and natural gas operations in early 2013 led the company to report these u.k. e & p activities as discontinued operations for all periods presented in the consolidated financial statements . united states oil production decreased from 20,114 barrels per day in 2010 to 17,148 barrels per day in 2011 with the lower volumes mostly caused by field decline at thunder hawk that was primarily due to a delay in development drilling operations in 2010 and 2011 following the macondo incident in april 2010. the production decline at thunder hawk was partially offset by higher oil volumes produced in 2011 at the eagle ford shale area in south texas . production of heavy oil in western canada was 7,264 barrels per day in 2011 , up from 5,988 barrels per day in 2010 , primarily due to ongoing drilling operations at the seal area in alberta . oil production offshore canada fell from 11,497 barrels per day in 2010 to 9,204 barrels per day in 2011 primarily due to field decline at terra nova and a reduction of the company 's working interest at this field from 12.0 % in 2010 to 10.475 % in 2011. synthetic oil operations at syncrude had net production of 13,498 barrels per day in 2011 , up from 13,273 barrels per day in 2010 , with the increase caused by a lower royalty rate in 2011 due to higher costs incurred for the operations . oil production in malaysia decreased from 66,897 barrels per day in 2010 to 48,551 barrels per day in 2011 , primarily due to lower production at the kikeh field . mechanical issues at kikeh led to certain wells being down for a portion of 2011. oil production in malaysia was favorably affected in 2011 by higher condensate and other gas liquids produced at gas fields offshore sarawak . the azurite field offshore republic of the congo averaged 4,989 barrels per day in 2011 , down from 5,820 barrels per day in 2010 due to faster than expected well decline . oil production from discontinued operations in the u.k. was 2,423 barrels per day in 2011 , down from 3,295 barrels per day in 2010 , with the decline primarily due to more downtime at the schiehallion and mungo/monan fields during the later year . worldwide sales of natural gas were a company record 490.1 million cubic feet ( mmcf ) per day in 2012 , after averaging 457.4 mmcf per day in 2011 and 356.8 mmcf per day in 2010. natural gas sales volumes in the u.s. were 53.0 mmcf per day in 2012 , up from 2011 production of 47.2 mmcf per day as higher production in the eagle ford shale area more than offset declines at fields in the gulf of mexico . natural gas volumes in western canada increased from 188.8 mmcf per day in 2011 to 217.0 mmcf per day in 2012 essentially due to higher gas volumes produced at the tupper area , as more wells were on production at tupper west during

million or 6.1 % , to $ 20.8 million from $ 19.6 million for the year ended december 31 , 2011. this increase is primarily related to an increase in shipments in calendar year 2012. in the product revenue category , there were 1,136 fuel cell systems shipped for the year ended december 31 , 2012 as compared to 984 fuel cell systems shipped for the year ended december 31 , 2011. service revenue : service revenue generally includes revenue from our service and maintenance contracts , hydrogen contracts , spare parts , and leased units . service revenue for the year ended december 31 , 2013 increased $ 3.1 million or 84.2 % , to $ 6.7 million from $ 3.6 million for the year ended december 31 , 2012. the increase is primarily related to new gencare service contracts placed by existing customers during 2013 . 27 service revenue for the year ended december 31 , 2012 decreased $ 16,000 or 0.4 % , to $ 3.6 million from $ 3.6 million for the year ended december 31 , 2011. the decrease is primarily related to a decline in spare part sales , partly offset by new service contracts placed by existing customers during 2012. research and development contract revenue . research and development contract revenue primarily relates to cost reimbursement research and development contracts associated with the development of pem fuel cell technology . we generally share in the cost of these programs with our cost-sharing percentages generally ranging from 30 % to 50 % of total project costs . revenue from time and material contracts is recognized on the basis of hours expended plus other reimbursable contract costs incurred during the period . we expect to continue certain research and development contract work that is related to our current product development efforts . research and development contract revenue for the year ended december 31 , 2013 decreased $ 0.2 million , or 12.0 % , to $ 1.5 million from $ 1.7 million for the year ended december 31 , 2012. the decrease is primarily related to a reduced effort on three funded projects that are complete or near completion , partially offset by the start of a new project . research and development contract revenue for the year ended december 31 , 2012 decreased $ 2.2 million , or 56.2 % , to $ 1.7 million from $ 3.9 million for the year ended december 31 , 2011. the decrease is primarily related to fewer active contracts during 2012. cost of product revenue . cost of product revenue includes direct material and labor costs , warranty cost , and an allocation of overhead costs that relate to the manufacture of gendrive products . cost of product revenue for the year ended december 31 , 2013 decreased $ 5.0 million , or 19.5 % , to $ 20.4 million from $ 25.4 million for the year ended december 31 , 2012. the decrease in the cost of product revenue was primarily related to a decline in the number of units shipped in 2013 compared to 2012. during the year ended december 31 , 2013 , in the cost of product revenue category , we shipped 918 fuel cell systems to end customers as compared to 1,136 fuel cell systems shipped during the year ended december , 2012. cost of product revenue for the year ended december 31 , 2012 increased $ 2.8 million , or 12.1 % , to $ 25.4 million from $ 22.6 million for the year ended december 31 , 2011. the increase in the cost of product revenue was primarily related to the increase in the number of units shipped in 2012 compared to 2011. during the year ended december 31 , 2012 , in the cost of product and service revenue category , we shipped 1,136 fuel cell systems to end customers as compared to 984 fuel cell systems shipped during the year ended december , 2011. cost of service revenue . cost of service revenue includes the labor and material costs incurred for our product service and maintenance contracts , our hydrogen contracts , replacement parts , rental units , and leased units . in addition , cost of service revenue also includes allocation of overhead costs that relate to the servicing of our gendrive products . cost of service revenue for the year ended december 31 , 2013 increased $ 2.6 million , or 21.3 % , to $ 14.9 million from $ 12.3 million for the year ended december 31 , 2012. the increase in the cost of service revenue was primarily related to a higher number of gencare service contracts in 2013 ( including service personnel to maintain these contracts ) which was offset by additional expenses for unanticipated warranty claims arising from gendrive component quality issues that were recorded during the year ended december 31 , 2012. cost of service revenue for the year ended december 31 , 2012 increased $ 4.3 million , or 53.0 % , to $ 12.3 million from $ 8.0 million for the year ended december 31 , 2011. the increase in the cost of service revenue was primarily related to additional expenses for unanticipated warranty claims arising from gendrive component quality issues that were recorded during the year ended december 31 , 2012 , coupled with a higher number of gencare service contracts in 2012 ( including service personnel to maintain these contracts ) . cost of research and development contract revenue . cost of research and development contract revenue includes costs associated with research and development contracts including : cash and non-cash compensation and benefits for engineering and related support staff , fees paid to outside suppliers for subcontracted components and services , fees paid to consultants for services provided , materials and supplies used and other directly allocable general overhead costs allocated to specific research and development contracts . story_separator_special_tag selling prices will be analyzed on a more frequent basis if a significant change in the company 's business necessitates a more timely analysis or if the company experiences significant variances in its selling prices . once relative selling prices are determined , the company proportionately allocates the sale consideration to each element of the arrangement . the allocated sales consideration related to fuel cell systems and equipment , spare parts , and hydrogen is recognized as revenue at shipment if title and risk of loss have passed to the customer , there is persuasive evidence of an arrangement , the sales price is fixed or determinable , collection of the related receivable is reasonably assured , and customer acceptance criteria , if any , have been successfully demonstrated . the allocated sales consideration related to installation , service , maintenance , and hydrogen delivery infrastructure is generally recognized as revenue when completed or on a straight-line basis over the term of the contract , as appropriate . the company does not include a right of return on its products other than rights related to warranty provisions that permit repair or replacement of defective goods . the company accrues for anticipated warranty costs at the same time that revenue is recognized for the related product . the company has also sold extended warranty contracts that generally provide for a five to ten year warranty from the date of product installation . these types of contacts are accounted for as a separate deliverable , and accordingly , revenue generated from these transactions is deferred and recognized in income over the warranty period generally on a straight-line basis . additionally , the company may enter into annual service and maintenance contracts that are billed monthly . revenue generated from these transactions is recognized in income on a straight-line basis over the term of the contract . contract accounting is used for research and development contract revenue , which primarily relates to cost reimbursement research and development contracts associated with the development of pem fuel cell technology . the company generally shares in the cost of these programs with cost sharing percentages generally ranging from 30 % to 50 % of total project costs . revenue from time and material contracts is recognized on the basis of hours expended plus other reimbursable contract costs incurred during the period . all allowable work performed through the end of each calendar quarter is billed , subject to limitations in the respective contracts . product warranty reserve : our gendrive products are generally sold with a one to two-year product warranty that commences on the product installation date . we currently estimate the costs of satisfying warranty claims based on an analysis of past experience and provide for future claims in the period the revenue is recognized . the company 's product and service warranty reserve as of december 31 , 2013 is approximately $ 1.6 million and is included in product warranty reserve in the consolidated balance sheets . included in this balance is approximately $ 1.2 million related to specific gendrive component quality issues that were identified during the year ended december 31 , 2012 . 34 in addition to the standard product warranty , we have entered into certain contracts with customers that include extended warranty and maintenance terms of five to ten years from the date of installation . revenue generated from these transactions is deferred and recognized in income over the warranty period . the fair value of the extended warranty and maintenance deliverable has been estimated using the projected cash outflows to meet the obligations in the related contract . projected cash outflows have been determined using estimated product run hours , failure rates and other assumptions based on the company 's historical experience . valuation of long-lived assets : we assess the impairment of long-lived assets , including identifiable intangible assets , whenever events or changes in circumstances indicate that the carrying value may not be recoverable . factors we consider important that could trigger an impairment review include , but are not limited to , the following : significant underperformance relative to expected historical or projected future operating results ; significant changes in the manner of our use of the acquired assets or the strategy for our overall business ; significant negative industry or economic trends ; significant decline in our stock price for a sustained period ; and our market capitalization relative to net book value . when we determine that the carrying value of long-lived assets , including identifiable intangible assets , may not be recoverable based upon the existence of one or more of the above indicators of impairment , we would measure any impairment based upon the provisions of fasb asc no . 350-35-30-14 , intangibles - goodwill and other , and fasb asc no . 360-10-35-15 , impairment or disposal of long-lived assets , as appropriate . any resulting impairment loss could have a material adverse impact on our financial condition and results of operations . stock based compensation : we recognize stock-based compensation expense associated with the vesting of share based instruments in the consolidated statements of operations . determining the amount of stock-based compensation to be recorded requires us to develop estimates to be used in calculating the grant-date fair value of stock options . we calculate the grant-date fair values using the black-scholes valuation model . the black-scholes model requires us to make estimates of the following assumptions : expected volatility—the estimated stock price volatility was derived based upon the company 's actual stock prices over an historical period equal to the expected life of the options , which represents the company 's best estimate of expected volatility . expected option life—the company 's estimate of an expected option life was calculated in accordance with the simplified method for calculating the expected term assumption . the simplified method is a calculation based on the contractual life and vesting terms of

liquidity and capital resources our cash requirements relate primarily to working capital needed to operate and grow our business , including funding operating expenses , growth in inventory to support both shipments of new units and servicing the installed base , funding the growth in our genkey “ turn-key ” solution which also includes the installation of our customer 's hydrogen infrastructure as well as delivery of the hydrogen molecule , and continued development and expansion of our products . our ability to achieve profitability and meet future liquidity needs and capital requirements will depend upon numerous factors , including the timing and quantity of product orders and shipments ; the timing and amount of our operating expenses ; the timing and costs of working capital needs ; the timing and costs of building a sales base ; the timing and costs of developing marketing and distribution channels ; the timing and costs of product service requirements ; the timing and costs of hiring and training product staff ; the extent to which our products gain market acceptance ; the timing and costs of product development and introductions ; the extent of our ongoing and any new research and development programs ; and changes in our strategy or our planned activities . if we are unable to fund our operations without additional external financing and therefore can not sustain future operations , we may be required to delay , reduce and or cease our operations and or seek bankruptcy protection . we have experienced and continue to experience negative cash flows from operations and net losses . the company incurred net losses attributable to common shareholders of $ 62.7 million , $ 31.9 million and $ 27.5 million for the years ended december 31 , 2013 , 2012 and 2011 , respectively , and has an accumulated deficit of $ 849.4 million at december 31 , 2013. substantially all of our accumulated deficit been incurred in connection with our operating expenses , research and development expenses and from general and administrative costs associated with our operations .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```liquidity and capital resources our cash requirements relate primarily to working capital needed to operate and grow our business , including funding operating expenses , growth in inventory to support both shipments of new units and servicing the installed base , funding the growth in our genkey “ turn-key ” solution which also includes the installation of our customer 's hydrogen infrastructure as well as delivery of the hydrogen molecule , and continued development and expansion of our products . our ability to achieve profitability and meet future liquidity needs and capital requirements will depend upon numerous factors , including the timing and quantity of product orders and shipments ; the timing and amount of our operating expenses ; the timing and costs of working capital needs ; the timing and costs of building a sales base ; the timing and costs of developing marketing and distribution channels ; the timing and costs of product service requirements ; the timing and costs of hiring and training product staff ; the extent to which our products gain market acceptance ; the timing and costs of product development and introductions ; the extent of our ongoing and any new research and development programs ; and changes in our strategy or our planned activities . if we are unable to fund our operations without additional external financing and therefore can not sustain future operations , we may be required to delay , reduce and or cease our operations and or seek bankruptcy protection . we have experienced and continue to experience negative cash flows from operations and net losses . the company incurred net losses attributable to common shareholders of $ 62.7 million , $ 31.9 million and $ 27.5 million for the years ended december 31 , 2013 , 2012 and 2011 , respectively , and has an accumulated deficit of $ 849.4 million at december 31 , 2013. substantially all of our accumulated deficit been incurred in connection with our operating expenses , research and development expenses and from general and administrative costs associated with our operations . ``` Suspicious Activity Report : million or 6.1 % , to $ 20.8 million from $ 19.6 million for the year ended december 31 , 2011. this increase is primarily related to an increase in shipments in calendar year 2012. in the product revenue category , there were 1,136 fuel cell systems shipped for the year ended december 31 , 2012 as compared to 984 fuel cell systems shipped for the year ended december 31 , 2011. service revenue : service revenue generally includes revenue from our service and maintenance contracts , hydrogen contracts , spare parts , and leased units . service revenue for the year ended december 31 , 2013 increased $ 3.1 million or 84.2 % , to $ 6.7 million from $ 3.6 million for the year ended december 31 , 2012. the increase is primarily related to new gencare service contracts placed by existing customers during 2013 . 27 service revenue for the year ended december 31 , 2012 decreased $ 16,000 or 0.4 % , to $ 3.6 million from $ 3.6 million for the year ended december 31 , 2011. the decrease is primarily related to a decline in spare part sales , partly offset by new service contracts placed by existing customers during 2012. research and development contract revenue . research and development contract revenue primarily relates to cost reimbursement research and development contracts associated with the development of pem fuel cell technology . we generally share in the cost of these programs with our cost-sharing percentages generally ranging from 30 % to 50 % of total project costs . revenue from time and material contracts is recognized on the basis of hours expended plus other reimbursable contract costs incurred during the period . we expect to continue certain research and development contract work that is related to our current product development efforts . research and development contract revenue for the year ended december 31 , 2013 decreased $ 0.2 million , or 12.0 % , to $ 1.5 million from $ 1.7 million for the year ended december 31 , 2012. the decrease is primarily related to a reduced effort on three funded projects that are complete or near completion , partially offset by the start of a new project . research and development contract revenue for the year ended december 31 , 2012 decreased $ 2.2 million , or 56.2 % , to $ 1.7 million from $ 3.9 million for the year ended december 31 , 2011. the decrease is primarily related to fewer active contracts during 2012. cost of product revenue . cost of product revenue includes direct material and labor costs , warranty cost , and an allocation of overhead costs that relate to the manufacture of gendrive products . cost of product revenue for the year ended december 31 , 2013 decreased $ 5.0 million , or 19.5 % , to $ 20.4 million from $ 25.4 million for the year ended december 31 , 2012. the decrease in the cost of product revenue was primarily related to a decline in the number of units shipped in 2013 compared to 2012. during the year ended december 31 , 2013 , in the cost of product revenue category , we shipped 918 fuel cell systems to end customers as compared to 1,136 fuel cell systems shipped during the year ended december , 2012. cost of product revenue for the year ended december 31 , 2012 increased $ 2.8 million , or 12.1 % , to $ 25.4 million from $ 22.6 million for the year ended december 31 , 2011. the increase in the cost of product revenue was primarily related to the increase in the number of units shipped in 2012 compared to 2011. during the year ended december 31 , 2012 , in the cost of product and service revenue category , we shipped 1,136 fuel cell systems to end customers as compared to 984 fuel cell systems shipped during the year ended december , 2011. cost of service revenue . cost of service revenue includes the labor and material costs incurred for our product service and maintenance contracts , our hydrogen contracts , replacement parts , rental units , and leased units . in addition , cost of service revenue also includes allocation of overhead costs that relate to the servicing of our gendrive products . cost of service revenue for the year ended december 31 , 2013 increased $ 2.6 million , or 21.3 % , to $ 14.9 million from $ 12.3 million for the year ended december 31 , 2012. the increase in the cost of service revenue was primarily related to a higher number of gencare service contracts in 2013 ( including service personnel to maintain these contracts ) which was offset by additional expenses for unanticipated warranty claims arising from gendrive component quality issues that were recorded during the year ended december 31 , 2012. cost of service revenue for the year ended december 31 , 2012 increased $ 4.3 million , or 53.0 % , to $ 12.3 million from $ 8.0 million for the year ended december 31 , 2011. the increase in the cost of service revenue was primarily related to additional expenses for unanticipated warranty claims arising from gendrive component quality issues that were recorded during the year ended december 31 , 2012 , coupled with a higher number of gencare service contracts in 2012 ( including service personnel to maintain these contracts ) . cost of research and development contract revenue . cost of research and development contract revenue includes costs associated with research and development contracts including : cash and non-cash compensation and benefits for engineering and related support staff , fees paid to outside suppliers for subcontracted components and services , fees paid to consultants for services provided , materials and supplies used and other directly allocable general overhead costs allocated to specific research and development contracts . story_separator_special_tag selling prices will be analyzed on a more frequent basis if a significant change in the company 's business necessitates a more timely analysis or if the company experiences significant variances in its selling prices . once relative selling prices are determined , the company proportionately allocates the sale consideration to each element of the arrangement . the allocated sales consideration related to fuel cell systems and equipment , spare parts , and hydrogen is recognized as revenue at shipment if title and risk of loss have passed to the customer , there is persuasive evidence of an arrangement , the sales price is fixed or determinable , collection of the related receivable is reasonably assured , and customer acceptance criteria , if any , have been successfully demonstrated . the allocated sales consideration related to installation , service , maintenance , and hydrogen delivery infrastructure is generally recognized as revenue when completed or on a straight-line basis over the term of the contract , as appropriate . the company does not include a right of return on its products other than rights related to warranty provisions that permit repair or replacement of defective goods . the company accrues for anticipated warranty costs at the same time that revenue is recognized for the related product . the company has also sold extended warranty contracts that generally provide for a five to ten year warranty from the date of product installation . these types of contacts are accounted for as a separate deliverable , and accordingly , revenue generated from these transactions is deferred and recognized in income over the warranty period generally on a straight-line basis . additionally , the company may enter into annual service and maintenance contracts that are billed monthly . revenue generated from these transactions is recognized in income on a straight-line basis over the term of the contract . contract accounting is used for research and development contract revenue , which primarily relates to cost reimbursement research and development contracts associated with the development of pem fuel cell technology . the company generally shares in the cost of these programs with cost sharing percentages generally ranging from 30 % to 50 % of total project costs . revenue from time and material contracts is recognized on the basis of hours expended plus other reimbursable contract costs incurred during the period . all allowable work performed through the end of each calendar quarter is billed , subject to limitations in the respective contracts . product warranty reserve : our gendrive products are generally sold with a one to two-year product warranty that commences on the product installation date . we currently estimate the costs of satisfying warranty claims based on an analysis of past experience and provide for future claims in the period the revenue is recognized . the company 's product and service warranty reserve as of december 31 , 2013 is approximately $ 1.6 million and is included in product warranty reserve in the consolidated balance sheets . included in this balance is approximately $ 1.2 million related to specific gendrive component quality issues that were identified during the year ended december 31 , 2012 . 34 in addition to the standard product warranty , we have entered into certain contracts with customers that include extended warranty and maintenance terms of five to ten years from the date of installation . revenue generated from these transactions is deferred and recognized in income over the warranty period . the fair value of the extended warranty and maintenance deliverable has been estimated using the projected cash outflows to meet the obligations in the related contract . projected cash outflows have been determined using estimated product run hours , failure rates and other assumptions based on the company 's historical experience . valuation of long-lived assets : we assess the impairment of long-lived assets , including identifiable intangible assets , whenever events or changes in circumstances indicate that the carrying value may not be recoverable . factors we consider important that could trigger an impairment review include , but are not limited to , the following : significant underperformance relative to expected historical or projected future operating results ; significant changes in the manner of our use of the acquired assets or the strategy for our overall business ; significant negative industry or economic trends ; significant decline in our stock price for a sustained period ; and our market capitalization relative to net book value . when we determine that the carrying value of long-lived assets , including identifiable intangible assets , may not be recoverable based upon the existence of one or more of the above indicators of impairment , we would measure any impairment based upon the provisions of fasb asc no . 350-35-30-14 , intangibles - goodwill and other , and fasb asc no . 360-10-35-15 , impairment or disposal of long-lived assets , as appropriate . any resulting impairment loss could have a material adverse impact on our financial condition and results of operations . stock based compensation : we recognize stock-based compensation expense associated with the vesting of share based instruments in the consolidated statements of operations . determining the amount of stock-based compensation to be recorded requires us to develop estimates to be used in calculating the grant-date fair value of stock options . we calculate the grant-date fair values using the black-scholes valuation model . the black-scholes model requires us to make estimates of the following assumptions : expected volatility—the estimated stock price volatility was derived based upon the company 's actual stock prices over an historical period equal to the expected life of the options , which represents the company 's best estimate of expected volatility . expected option life—the company 's estimate of an expected option life was calculated in accordance with the simplified method for calculating the expected term assumption . the simplified method is a calculation based on the contractual life and vesting terms of

healthcare laws and proposals . overview we are a biotechnology company focused on rapidly bringing to market precisely designed dna medicines to treat , cure , and protect people from diseases associated with human papillomavirus ( hpv ) , cancer , and infectious diseases . our dna medicine pipeline is comprised of three types of product candidates , dna vaccines , dna immunotherapies and dna encoded monoclonal antibodies ( dmabs ) . in clinical trials , we have demonstrated that a dna medicine can be delivered directly into cells in the body via our proprietary smart device to consistently activate robust and fully functional t cell and antibody responses against targeted cancers and pathogens . our novel dna medicine candidates are made using our proprietary syncon ® technology that creates optimized plasmids , which are circular strands of dna that can produce antigens independently inside a cell to help the person 's immune system recognize and destroy cancerous or virally infected cells . our hand-held cellectra ® smart delivery devices provide optimized uptake of our dna medicines within the cell , overcoming a key limitation of other dna-based technology approaches . human data to date have shown a favorable safety profile of our dna medicines delivered directly into cells in the body using the cellectra ® smart device in more than 6,000 administrations across more than 2,000 patients . our corporate strategy is to advance , protect , and provide our novel dna medicines to meet urgent and emerging global health needs . we continue to advance and validate an array of dna medicine candidates that target hpv-related diseases , cancer , and infectious diseases . we aim to advance these candidates through commercialization and continue to leverage third-party resources through collaborations and partnerships , including product license agreements . our partners and collaborators include apollobio corp. , astrazeneca , beijing advaccine , the bill & melinda gates foundation , coalition for epidemic preparedness innovations ( cepi ) , defense advanced research projects agency ( darpa ) , 67 geneone life science , hiv vaccines trial network , the u.s. defense threat reduction agency 's medical cbrn defense consortium ( mcdc ) , national cancer institute , national institutes of health , national institute of allergy and infectious diseases , plumbline life sciences , regeneron pharmaceuticals , roche/genentech , the university of pennsylvania , the walter reed army institute of research , and the wistar institute . we or our collaborators are currently conducting or planning clinical studies of our dna medicines for hpv-associated precancers , including cervical , vulvar , and anal dysplasia ; hpv-associated cancers , including head & neck , cervical , anal , penile , vulvar , and vaginal ; other hpv-associated disorders , such as recurrent respiratory papillomatosis , or rrp ; glioblastoma multiforme , or gbm ; prostate cancer ; hiv ; ebola ; middle east respiratory syndrome , or mers ; lassa fever ; zika virus ; and the covid-19 virus ( coronavirus ) . all of our product candidates are in the research and development phase . we have not generated any revenues from the sale of any products , and we do not expect to generate any such revenues for at least the next several years . we earn revenue from license fees and milestone revenue and collaborative research and development agreements . our product candidates will require significant additional research and development efforts , including extensive preclinical and clinical testing . all product candidates that we advance to clinical testing will require regulatory approval prior to commercial use , and will require significant costs for commercialization . we may not be successful in our research and development efforts , and we may never generate sufficient product revenue to be profitable . in july 2019 , we announced a strategic organizational restructuring . in order to reduce operating expenses and conserve cash resources , we reduced approximately 28 % of our workforce and discontinued our immuno-oncology phase 1/2 clinical trial of our product candidate ino-5401 in patients with advanced bladder cancer . in the third quarter of 2019 , we incurred a personnel-related restructuring charge of $ 2.2 million in connection with one-time employee termination costs , including severance and other benefits . as of december 31 , 2019 , we had an accumulated deficit of $ 739.8 million . we expect to continue to incur substantial operating losses in the future due to our commitment to our research and development programs , the funding of preclinical studies , clinical trials and regulatory activities and the costs of general and administrative activities . critical accounting policies the sec defines critical accounting policies as those that are , in management 's view , important to the portrayal of our financial condition and results of operations and require management 's judgment . our discussion and analysis of our financial condition and results of operations are based on our audited consolidated financial statements , which have been prepared in accordance with u.s. gaap . the preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets , liabilities , revenue and expenses . we base our estimates on experience and on various assumptions that we believe are reasonable under the circumstances , the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources . actual results may differ from those estimates . our critical accounting policies include : revenue recognition effective january 1 , 2018 , we adopted accounting standards update ( “ asu ” ) 2014-09 , revenue from contracts with customers ( “ topic 606 ” ) using the modified retrospective method which consisted of applying and recognizing the cumulative effect of topic 606 at the date of initial application . story_separator_special_tag we also had u.s. federal and state research and development tax credits of $ 17.3 million and $ 3.2 million , respectively , net of the federal research and development credits that will expire due to irc section 383 limitations . the net operating losses and credits began to expire during 2020 . comparison of years ended december 31 , 2018 and 2017 revenue revenue primarily consisted of revenue under collaborative research and development arrangements for the year ended december 31 , 2018 , and revenue under collaborative research and development arrangements , grants and government contracts for the year ended december 31 , 2017. our year over year total revenue decreased $ 11.7 million , or 28 % . as of january 1 , 2018 , accounting for our various grant agreements falls under the contributions guidance under subtopic 958-605 , not-for-profit entities-revenue recognition , which is outside the scope of topic 606 , as the government agencies granting us funds are not receiving equivalent value for their contributions . beginning on january 1 , 2018 , after adopting topic 606 using the modified retrospective transition method , all contributions received from current grant agreements are being recorded as a contra-expense as opposed to revenue on the consolidated statement of operations . the $ 1.1 million increase in revenue under collaborative research and development arrangements for the year ended december 31 , 2018 as compared to 2017 was primarily due to the recognition of the gross upfront payment of $ 23.0 million from apollobio during the second quarter of 2018. this increase was offset by an overall decrease in revenue from the astrazeneca collaboration of $ 15.4 million , primarily related to previously deferred revenue recognized during the second quarter of 2017 , upon selection of the first cancer research collaboration product candidate by astrazeneca , among other variances . there was also no revenue recognized in 2018 from roche compared to $ 6.1 million for 2017 , due to the termination of the agreement in 2017. for the year ended december 31 , 2018 , grant funding received and recorded as contra-research and development expense was $ 9.5 million , as compared to $ 13.0 million recorded as grant and miscellaneous revenue , including arrangements with affiliated entities , for the year ended december 31 , 2017. the decrease in grant funding recorded for the year over year was primarily due to a decrease from our darpa ebola grant of $ 8.8 million , partially offset by an increase from our cepi grant of $ 4.3 million . research and development expenses the $ 3.3 million decrease in research and development expenses for the year ended december 31 , 2018 as compared to 2017 was primarily due to the $ 9.5 million contra-research and development expense recorded from grant agreements as discussed above , as well as a decrease of $ 8.9 million in expenses related to the darpa ebola grant and a decrease of $ 2.0 million in expenses related to our hepatitis b program . these decreases were partially offset by an increase of $ 4.0 million related to increased employee headcount to support clinical trials and partnerships , an increase of $ 3.1 million for drug manufacturing related to our collaboration with astrazeneca , an increase in expenses related to our gbm clinical trial of $ 2.8 million , an increase in expenses of $ 2.6 million related to our vgx-3100 phase 3 clinical trial , an increase in expenses of $ 2.6 million related to our cepi grant and an increase in depreciation expense of $ 2.3 million , among other variances . general and administrative expenses the $ 1.0 million increase in general and administrative expenses for the year ended december 31 , 2018 as compared to 2017 was primarily related to the $ 1.4 million of foreign non-income taxes withheld from the apollobio upfront payment we received in 2018 and the advisory fee of $ 960,000 incurred in connection with receiving the upfront payment . there were also increases in legal expense and personnel costs from increases in employee headcount of $ 1.3 million and $ 1.2 million , respectively , partially offset by a decrease in non-cash stock-based compensation expense of $ 2.8 million and depreciation expense of $ 1.4 million , among other variances . stock-based compensation employee stock-based compensation cost is measured at the grant date , based on the fair value of the award , and is recognized as expense over the employee 's requisite service period . total employee stock-based compensation cost for the years ended december 31 , 2018 and 2017 was $ 10.2 million and $ 12.9 million , of which $ 5.9 million and $ 5.8 million was included in research and development expenses and $ 4.3 million and $ 7.1 million was included in general and administrative expenses , respectively . the year over year decrease was primarily due to a lower weighted average grant date fair value for the 73 awards granted in 2018 , as well as higher expenses recorded for certain stock option modifications which occurred in 2017. at december 31 , 2018 , there was $ 5.2 million of total unrecognized compensation cost related to unvested stock options , which we expect to recognize over a weighted-average period of 1.7 years , as compared to $ 5.9 million for the year ended december 31 , 2017 expected to be recognized over a weighted-average period of 1.8 years . at december 31 , 2018 , there was $ 5.1 million of total unrecognized compensation cost related to unvested restricted stock units , which is expected to be recognized over a weighted-average period of 1.7 years , as compared to $ 5.3 million for the year ended december 31 , 2017 expected to be recognized over a weighted-average period of 1.8 years . total stock-based compensation for options granted to non-employees for the years ended december 31 , 2018 and 2017

working capital and liquidity as of december 31 , 2019 , we had cash and short-term investments of $ 89.5 million and working capital of $ 62.2 million , as compared to $ 81.2 million and $ 52.5 million as of december 31 , 2018 , respectively . the increase in cash and short-term investments during the year ended december 31 , 2019 was primarily due to the net proceeds of $ 75.7 million received from the issuance of the notes and net proceeds of $ 14.5 million and $ 4.0 million received from the issuance of the august 2019 bonds and december 2019 bonds , respectively , offset by expenditures related to our research and development activities , clinical trials and various general and administrative expenses related to legal , consultants , accounting and audit , and corporate development . net cash used in operating activities for the year ended december 31 , 2019 of $ 97.9 million consisted of net loss of $ 120.6 million less use of net cash in operating assets and liabilities of $ 3.5 million , partially offset by net non-cash adjustments of $ 26.2 million . the primary non-cash expenses added back to net loss included stock-based compensation of $ 10.9 million , interest expense of $ 5.2 million , depreciation and amortization of $ 4.7 million , loss on investment in affiliated entities of $ 3.1 million and change in fair value of derivative liability of $ 1.8 million .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```working capital and liquidity as of december 31 , 2019 , we had cash and short-term investments of $ 89.5 million and working capital of $ 62.2 million , as compared to $ 81.2 million and $ 52.5 million as of december 31 , 2018 , respectively . the increase in cash and short-term investments during the year ended december 31 , 2019 was primarily due to the net proceeds of $ 75.7 million received from the issuance of the notes and net proceeds of $ 14.5 million and $ 4.0 million received from the issuance of the august 2019 bonds and december 2019 bonds , respectively , offset by expenditures related to our research and development activities , clinical trials and various general and administrative expenses related to legal , consultants , accounting and audit , and corporate development . net cash used in operating activities for the year ended december 31 , 2019 of $ 97.9 million consisted of net loss of $ 120.6 million less use of net cash in operating assets and liabilities of $ 3.5 million , partially offset by net non-cash adjustments of $ 26.2 million . the primary non-cash expenses added back to net loss included stock-based compensation of $ 10.9 million , interest expense of $ 5.2 million , depreciation and amortization of $ 4.7 million , loss on investment in affiliated entities of $ 3.1 million and change in fair value of derivative liability of $ 1.8 million . ``` Suspicious Activity Report : healthcare laws and proposals . overview we are a biotechnology company focused on rapidly bringing to market precisely designed dna medicines to treat , cure , and protect people from diseases associated with human papillomavirus ( hpv ) , cancer , and infectious diseases . our dna medicine pipeline is comprised of three types of product candidates , dna vaccines , dna immunotherapies and dna encoded monoclonal antibodies ( dmabs ) . in clinical trials , we have demonstrated that a dna medicine can be delivered directly into cells in the body via our proprietary smart device to consistently activate robust and fully functional t cell and antibody responses against targeted cancers and pathogens . our novel dna medicine candidates are made using our proprietary syncon ® technology that creates optimized plasmids , which are circular strands of dna that can produce antigens independently inside a cell to help the person 's immune system recognize and destroy cancerous or virally infected cells . our hand-held cellectra ® smart delivery devices provide optimized uptake of our dna medicines within the cell , overcoming a key limitation of other dna-based technology approaches . human data to date have shown a favorable safety profile of our dna medicines delivered directly into cells in the body using the cellectra ® smart device in more than 6,000 administrations across more than 2,000 patients . our corporate strategy is to advance , protect , and provide our novel dna medicines to meet urgent and emerging global health needs . we continue to advance and validate an array of dna medicine candidates that target hpv-related diseases , cancer , and infectious diseases . we aim to advance these candidates through commercialization and continue to leverage third-party resources through collaborations and partnerships , including product license agreements . our partners and collaborators include apollobio corp. , astrazeneca , beijing advaccine , the bill & melinda gates foundation , coalition for epidemic preparedness innovations ( cepi ) , defense advanced research projects agency ( darpa ) , 67 geneone life science , hiv vaccines trial network , the u.s. defense threat reduction agency 's medical cbrn defense consortium ( mcdc ) , national cancer institute , national institutes of health , national institute of allergy and infectious diseases , plumbline life sciences , regeneron pharmaceuticals , roche/genentech , the university of pennsylvania , the walter reed army institute of research , and the wistar institute . we or our collaborators are currently conducting or planning clinical studies of our dna medicines for hpv-associated precancers , including cervical , vulvar , and anal dysplasia ; hpv-associated cancers , including head & neck , cervical , anal , penile , vulvar , and vaginal ; other hpv-associated disorders , such as recurrent respiratory papillomatosis , or rrp ; glioblastoma multiforme , or gbm ; prostate cancer ; hiv ; ebola ; middle east respiratory syndrome , or mers ; lassa fever ; zika virus ; and the covid-19 virus ( coronavirus ) . all of our product candidates are in the research and development phase . we have not generated any revenues from the sale of any products , and we do not expect to generate any such revenues for at least the next several years . we earn revenue from license fees and milestone revenue and collaborative research and development agreements . our product candidates will require significant additional research and development efforts , including extensive preclinical and clinical testing . all product candidates that we advance to clinical testing will require regulatory approval prior to commercial use , and will require significant costs for commercialization . we may not be successful in our research and development efforts , and we may never generate sufficient product revenue to be profitable . in july 2019 , we announced a strategic organizational restructuring . in order to reduce operating expenses and conserve cash resources , we reduced approximately 28 % of our workforce and discontinued our immuno-oncology phase 1/2 clinical trial of our product candidate ino-5401 in patients with advanced bladder cancer . in the third quarter of 2019 , we incurred a personnel-related restructuring charge of $ 2.2 million in connection with one-time employee termination costs , including severance and other benefits . as of december 31 , 2019 , we had an accumulated deficit of $ 739.8 million . we expect to continue to incur substantial operating losses in the future due to our commitment to our research and development programs , the funding of preclinical studies , clinical trials and regulatory activities and the costs of general and administrative activities . critical accounting policies the sec defines critical accounting policies as those that are , in management 's view , important to the portrayal of our financial condition and results of operations and require management 's judgment . our discussion and analysis of our financial condition and results of operations are based on our audited consolidated financial statements , which have been prepared in accordance with u.s. gaap . the preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets , liabilities , revenue and expenses . we base our estimates on experience and on various assumptions that we believe are reasonable under the circumstances , the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources . actual results may differ from those estimates . our critical accounting policies include : revenue recognition effective january 1 , 2018 , we adopted accounting standards update ( “ asu ” ) 2014-09 , revenue from contracts with customers ( “ topic 606 ” ) using the modified retrospective method which consisted of applying and recognizing the cumulative effect of topic 606 at the date of initial application . story_separator_special_tag we also had u.s. federal and state research and development tax credits of $ 17.3 million and $ 3.2 million , respectively , net of the federal research and development credits that will expire due to irc section 383 limitations . the net operating losses and credits began to expire during 2020 . comparison of years ended december 31 , 2018 and 2017 revenue revenue primarily consisted of revenue under collaborative research and development arrangements for the year ended december 31 , 2018 , and revenue under collaborative research and development arrangements , grants and government contracts for the year ended december 31 , 2017. our year over year total revenue decreased $ 11.7 million , or 28 % . as of january 1 , 2018 , accounting for our various grant agreements falls under the contributions guidance under subtopic 958-605 , not-for-profit entities-revenue recognition , which is outside the scope of topic 606 , as the government agencies granting us funds are not receiving equivalent value for their contributions . beginning on january 1 , 2018 , after adopting topic 606 using the modified retrospective transition method , all contributions received from current grant agreements are being recorded as a contra-expense as opposed to revenue on the consolidated statement of operations . the $ 1.1 million increase in revenue under collaborative research and development arrangements for the year ended december 31 , 2018 as compared to 2017 was primarily due to the recognition of the gross upfront payment of $ 23.0 million from apollobio during the second quarter of 2018. this increase was offset by an overall decrease in revenue from the astrazeneca collaboration of $ 15.4 million , primarily related to previously deferred revenue recognized during the second quarter of 2017 , upon selection of the first cancer research collaboration product candidate by astrazeneca , among other variances . there was also no revenue recognized in 2018 from roche compared to $ 6.1 million for 2017 , due to the termination of the agreement in 2017. for the year ended december 31 , 2018 , grant funding received and recorded as contra-research and development expense was $ 9.5 million , as compared to $ 13.0 million recorded as grant and miscellaneous revenue , including arrangements with affiliated entities , for the year ended december 31 , 2017. the decrease in grant funding recorded for the year over year was primarily due to a decrease from our darpa ebola grant of $ 8.8 million , partially offset by an increase from our cepi grant of $ 4.3 million . research and development expenses the $ 3.3 million decrease in research and development expenses for the year ended december 31 , 2018 as compared to 2017 was primarily due to the $ 9.5 million contra-research and development expense recorded from grant agreements as discussed above , as well as a decrease of $ 8.9 million in expenses related to the darpa ebola grant and a decrease of $ 2.0 million in expenses related to our hepatitis b program . these decreases were partially offset by an increase of $ 4.0 million related to increased employee headcount to support clinical trials and partnerships , an increase of $ 3.1 million for drug manufacturing related to our collaboration with astrazeneca , an increase in expenses related to our gbm clinical trial of $ 2.8 million , an increase in expenses of $ 2.6 million related to our vgx-3100 phase 3 clinical trial , an increase in expenses of $ 2.6 million related to our cepi grant and an increase in depreciation expense of $ 2.3 million , among other variances . general and administrative expenses the $ 1.0 million increase in general and administrative expenses for the year ended december 31 , 2018 as compared to 2017 was primarily related to the $ 1.4 million of foreign non-income taxes withheld from the apollobio upfront payment we received in 2018 and the advisory fee of $ 960,000 incurred in connection with receiving the upfront payment . there were also increases in legal expense and personnel costs from increases in employee headcount of $ 1.3 million and $ 1.2 million , respectively , partially offset by a decrease in non-cash stock-based compensation expense of $ 2.8 million and depreciation expense of $ 1.4 million , among other variances . stock-based compensation employee stock-based compensation cost is measured at the grant date , based on the fair value of the award , and is recognized as expense over the employee 's requisite service period . total employee stock-based compensation cost for the years ended december 31 , 2018 and 2017 was $ 10.2 million and $ 12.9 million , of which $ 5.9 million and $ 5.8 million was included in research and development expenses and $ 4.3 million and $ 7.1 million was included in general and administrative expenses , respectively . the year over year decrease was primarily due to a lower weighted average grant date fair value for the 73 awards granted in 2018 , as well as higher expenses recorded for certain stock option modifications which occurred in 2017. at december 31 , 2018 , there was $ 5.2 million of total unrecognized compensation cost related to unvested stock options , which we expect to recognize over a weighted-average period of 1.7 years , as compared to $ 5.9 million for the year ended december 31 , 2017 expected to be recognized over a weighted-average period of 1.8 years . at december 31 , 2018 , there was $ 5.1 million of total unrecognized compensation cost related to unvested restricted stock units , which is expected to be recognized over a weighted-average period of 1.7 years , as compared to $ 5.3 million for the year ended december 31 , 2017 expected to be recognized over a weighted-average period of 1.8 years . total stock-based compensation for options granted to non-employees for the years ended december 31 , 2018 and 2017

proposed new products may be subject to regulatory clearance or approval prior to commercialization and the time period for introducing a new product to the marketplace can be unpredictable . we also focus on controlling costs by investing in modern manufacturing technologies and controlling purchasing processes . we have been successful in consistently generating cash from operations and have used that cash to reduce or eliminate indebtedness , to fund capital expenditures , to make investment purchases , to repurchase stock and to pay dividends . - 18 - our strategic objective is to further enhance our position in our served markets by : · focusing on customer needs ; · expanding existing product lines and developing new products ; · maintaining a culture of controlling cost ; and · preserving and fostering a collaborative , entrepreneurial management structure . for the year ended december 31 , 2012 , we reported revenues of $ 119.1 million , operating income of $ 33.6 million and net income of $ 23.6 million . results of operations our net income was $ 23.6 million , or $ 11.72 per basic and $ 11.66 per diluted share , in 2012 , compared to net income of $ 26.0 million , or $ 12.90 per basic and $ 12.82 per diluted share , in 2011 and net income of $ 21.0 million , or $ 10.38 per basic and $ 10.32 per diluted share , in 2010. revenues were $ 119.1 million in 2012 , compared with $ 117.7 million in 2011 and $ 108.6 million in 2010. the 1 percent revenue increase in 2012 over 2011 and 8 percent revenue increase in 2011 over 2010 were generally attributable to higher sales volumes . increases in revenues in 2012 in our fluid delivery and cardiovascular product lines were largely offset by reduced sales to a large customer with which we have a long-term contract that had accumulated too large of an inventory of one of our products in 2011. annual revenues by product lines were as follows ( in thousands ) : replace_table_token_4_th our cost of goods sold was $ 62.9 million in 2012 and $ 57.7 million in each of 2011 and 2010. product mix , higher depreciation expense and lower manufacturing efficiencies in one product line partially offset by the impact of continued cost improvement initiatives were the primary contributors to the 9 percent increase in cost of goods sold for 2012 over 2011. gross profit in 2012 was $ 56.1 million compared with $ 60.0 million in 2011 and $ 50.9 million in 2010. our gross profit was 47 percent of revenues in 2012 , 51 percent of revenues in 2011 and 47 percent of revenues in 2010. the decrease in gross profit percentage in 2012 was primarily related to a product mix that was less favorable than 2011 's product mix . the increases in gross profit percentage in 2011 from the prior year were primarily due to a more favorable product mix , improvements in manufacturing efficiencies and the impact of cost-savings projects . operating expenses were $ 22.5 million in 2012 compared with $ 21.8 million in 2011 and $ 19.9 million in 2010. in 2012 increases in selling expenses and increases in research and development , or r & d , expenses were partially offset by decreases in general and administrative , or g & a , expenses . r & d expenses increased $ 898,000 in 2012 as compared to 2011 primarily related to increased compensation costs , increased supplies costs , increased travel costs and increased outside services . r & d expenses consist primarily of salaries and other related expenses of our r & d personnel as well as costs associated with regulatory matters . in 2012 , selling expenses increased $ 369,000 primarily related to increased compensation , commissions and promotional expenses . selling expenses consist primarily of salaries , commissions and other related expenses for sales and marketing personnel , marketing , advertising and promotional expenses . g & a expenses decreased $ 592,000 in 2012 as compared to 2011 primarily related to decreased outside services . g & a expenses consist primarily of salaries and other related expenses of administrative , executive and financial personnel and outside professional fees . - 19 - in 2011 , increases in g & a expenses and increases in r & d expenses were partially offset by decreases in selling expenses . g & a expenses increased $ 1.7 million in 2011 as compared to 2010 primarily related to increased compensation and increased outside services . r & d expenses increased $ 199,000 in 2011 as compared to 2010 primarily related to increased compensation costs , increased supplies costs and increased outside services . in 2011 , selling expenses decreased $ 43,000 primarily related to decreased compensation and promotional expenses . our operating income for 2012 was $ 33.6 million , compared with $ 38.2 million in 2011 and $ 31.0 million in 2010. operating income was 28 percent of revenues for 2012 , 32 percent of revenues for 2011 and 29 percent of revenues for 2010. the decrease in gross profit and the increase in operating expenses described above were the major contributors to the operating income decrease in 2012 compared to the previous year . the increase in gross profit partially offset by the increase in operating expenses described above was the major contributor to the operating income improvement in 2011 compared to the previous year . during 2013 we anticipate increases in r & d expenses and depreciation charges . story_separator_special_tag after taking these items into consideration , we expect growth in our operating income during 2013 as compared to 2012. our interest income for 2012 was $ 1.4 million compared with $ 1.3 million in 2011 and $ 1.0 million in 2010. the increases in 2012 and 2011 were primarily related to the increased levels of cash and investments during 2012 and 2011. results for 2012 and 2011 were also favorably impacted by investing in bonds with slightly longer maturities and higher yields . income tax expense in 2012 totaled $ 11.4 million , compared with $ 13.4 million in 2011 and $ 11.0 million in 2010. the effective tax rates for 2012 , 2011 and 2010 were 32.6 percent , 34.0 percent and 34.5 percent , respectively . the decrease in our effective tax rate for 2012 was primarily related to a favorable adjustment to an uncertain tax position related to income tax credits claimed for research and development following the conclusion of an internal revenue service examination of our united states federal income tax returns for 2006 , 2007 and 2008. benefits from tax incentives for domestic production totaled $ 949,000 in 2012 , $ 996,000 in 2011 and $ 957,000 in 2010. benefits from changes in uncertain tax positions totaled $ 720,000 in 2012 and $ 159,000 in 2011. expenses from changes in uncertain tax positions totaled $ 255,000 in 2010. we expect our effective tax rate for 2013 to be approximately 33.5 percent . story_separator_special_tag inflation primarily in the prices we pay for labor , materials and services . over the last three years , we have experienced the effects of moderate inflation in these costs . at times , we have been able to offset a portion of these increased costs by increasing the sales prices of our products . however , competitive pressures have not allowed for full recovery of these cost increases . new accounting pronouncements from time to time , new accounting standards updates applicable to us are issued by the fasb , which we will adopt as of the specified effective date . unless otherwise discussed , we believe the impact of recently issued standards updates that are not yet effective will not have a material impact on our consolidated financial statements upon adoption . critical accounting policies the discussion and analysis of our financial condition and results of operations are based on our consolidated financial statements , which have been prepared in accordance with accounting principles generally accepted in the united states . in the preparation of these financial statements , we make estimates and assumptions that affect the reported amounts of assets , liabilities , revenues and expenses , and related disclosures of contingent assets and liabilities . we believe the following discussion addresses our most critical accounting policies and estimates , which are those that are most important to the portrayal of our financial condition and results and require management 's most difficult , subjective and complex judgments , often as a result of the need to make estimates about the effect of matters that are inherently uncertain . actual results could differ significantly from those estimates under different assumptions and conditions . from time to time , we accrue legal costs associated with certain litigation . in making determinations of likely outcomes of litigation matters , we consider the evaluation of legal counsel knowledgeable about each matter , case law and other case-specific issues . we believe these accruals are adequate to cover the legal fees and expenses associated with litigating these matters . however , the time and cost required to litigate these matters as well as the outcomes of the proceedings may vary from what we have projected . we maintain an allowance for doubtful accounts to reflect estimated losses resulting from the failure of customers to make required payments . on an ongoing basis , the collectability of accounts receivable is assessed based upon historical collection trends , current economic factors and the assessment of the collectability of specific accounts . we evaluate the collectability of specific accounts and determine when to grant credit to our customers using a combination of factors , including the age of the outstanding balances , evaluation of customers ' current and past financial condition , recent payment history , current economic environment , and discussions with our personnel and with the customers directly . accounts are written off when it is determined the receivable will not be collected . if circumstances change , our estimates of the collectability of amounts could be changed by a material amount . we are required to estimate our provision for income taxes and uncertain tax positions in each of the jurisdictions in which we operate . this process involves estimating our actual current tax exposure , including assessing the risks associated with tax audits , together with assessing temporary differences resulting from the different treatment of items for tax and accounting purposes . these differences result in deferred tax assets and liabilities , which are included within the balance sheet . we assess the likelihood that our deferred tax assets will be recovered from future taxable income and , to the extent we believe that recovery is more likely than not , do not establish a valuation allowance . in the event that actual results differ from these estimates , the provision for income taxes could be materially impacted . - 22 - we assess the impairment of our long-lived identifiable assets , excluding goodwill which is tested for impairment as explained below , whenever events or changes in circumstances indicate that the carrying value may not be recoverable . this review is based upon projections of anticipated future cash flows . although we believe that our estimates of future cash flows are reasonable , different assumptions regarding such cash flows or future changes in our business plan could materially affect our evaluations . no such changes are anticipated at this time

liquidity and capital resources effective october 1 , 2011 , our revolving credit facility with a money center bank was amended to increase the maximum principal amount of our revolving line of credit from $ 25.0 million to $ 40.0 million and to extend the termination date for advances under the revolving line of credit to october 1 , 2016. the credit facility is to be utilized for the funding of operations and for major capital projects or acquisitions , subject to certain limitations and restrictions . borrowings under the credit facility bear interest that is payable monthly at 30-day , 60-day or 90-day libor , as selected by us , plus one percent . from time to time prior to october 1 , 2016 and assuming an event of default is not then existing , we can convert outstanding advances under the revolving line of credit to term loans with a term of up to two years . we had no outstanding borrowings under our credit facility at december 31 , 2012 or 2011. the credit facility contains various restrictive covenants , none of which is expected to impact our liquidity or capital resources . at december 31 , 2012 , we were in compliance with all financial covenants . we believe the bank providing the credit facility is highly-rated and that the entire $ 40.0 million under the credit facility is currently available to us . if that bank were unable to provide such funds , we believe such inability would not impact our ability to fund operations .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```liquidity and capital resources effective october 1 , 2011 , our revolving credit facility with a money center bank was amended to increase the maximum principal amount of our revolving line of credit from $ 25.0 million to $ 40.0 million and to extend the termination date for advances under the revolving line of credit to october 1 , 2016. the credit facility is to be utilized for the funding of operations and for major capital projects or acquisitions , subject to certain limitations and restrictions . borrowings under the credit facility bear interest that is payable monthly at 30-day , 60-day or 90-day libor , as selected by us , plus one percent . from time to time prior to october 1 , 2016 and assuming an event of default is not then existing , we can convert outstanding advances under the revolving line of credit to term loans with a term of up to two years . we had no outstanding borrowings under our credit facility at december 31 , 2012 or 2011. the credit facility contains various restrictive covenants , none of which is expected to impact our liquidity or capital resources . at december 31 , 2012 , we were in compliance with all financial covenants . we believe the bank providing the credit facility is highly-rated and that the entire $ 40.0 million under the credit facility is currently available to us . if that bank were unable to provide such funds , we believe such inability would not impact our ability to fund operations . ``` Suspicious Activity Report : proposed new products may be subject to regulatory clearance or approval prior to commercialization and the time period for introducing a new product to the marketplace can be unpredictable . we also focus on controlling costs by investing in modern manufacturing technologies and controlling purchasing processes . we have been successful in consistently generating cash from operations and have used that cash to reduce or eliminate indebtedness , to fund capital expenditures , to make investment purchases , to repurchase stock and to pay dividends . - 18 - our strategic objective is to further enhance our position in our served markets by : · focusing on customer needs ; · expanding existing product lines and developing new products ; · maintaining a culture of controlling cost ; and · preserving and fostering a collaborative , entrepreneurial management structure . for the year ended december 31 , 2012 , we reported revenues of $ 119.1 million , operating income of $ 33.6 million and net income of $ 23.6 million . results of operations our net income was $ 23.6 million , or $ 11.72 per basic and $ 11.66 per diluted share , in 2012 , compared to net income of $ 26.0 million , or $ 12.90 per basic and $ 12.82 per diluted share , in 2011 and net income of $ 21.0 million , or $ 10.38 per basic and $ 10.32 per diluted share , in 2010. revenues were $ 119.1 million in 2012 , compared with $ 117.7 million in 2011 and $ 108.6 million in 2010. the 1 percent revenue increase in 2012 over 2011 and 8 percent revenue increase in 2011 over 2010 were generally attributable to higher sales volumes . increases in revenues in 2012 in our fluid delivery and cardiovascular product lines were largely offset by reduced sales to a large customer with which we have a long-term contract that had accumulated too large of an inventory of one of our products in 2011. annual revenues by product lines were as follows ( in thousands ) : replace_table_token_4_th our cost of goods sold was $ 62.9 million in 2012 and $ 57.7 million in each of 2011 and 2010. product mix , higher depreciation expense and lower manufacturing efficiencies in one product line partially offset by the impact of continued cost improvement initiatives were the primary contributors to the 9 percent increase in cost of goods sold for 2012 over 2011. gross profit in 2012 was $ 56.1 million compared with $ 60.0 million in 2011 and $ 50.9 million in 2010. our gross profit was 47 percent of revenues in 2012 , 51 percent of revenues in 2011 and 47 percent of revenues in 2010. the decrease in gross profit percentage in 2012 was primarily related to a product mix that was less favorable than 2011 's product mix . the increases in gross profit percentage in 2011 from the prior year were primarily due to a more favorable product mix , improvements in manufacturing efficiencies and the impact of cost-savings projects . operating expenses were $ 22.5 million in 2012 compared with $ 21.8 million in 2011 and $ 19.9 million in 2010. in 2012 increases in selling expenses and increases in research and development , or r & d , expenses were partially offset by decreases in general and administrative , or g & a , expenses . r & d expenses increased $ 898,000 in 2012 as compared to 2011 primarily related to increased compensation costs , increased supplies costs , increased travel costs and increased outside services . r & d expenses consist primarily of salaries and other related expenses of our r & d personnel as well as costs associated with regulatory matters . in 2012 , selling expenses increased $ 369,000 primarily related to increased compensation , commissions and promotional expenses . selling expenses consist primarily of salaries , commissions and other related expenses for sales and marketing personnel , marketing , advertising and promotional expenses . g & a expenses decreased $ 592,000 in 2012 as compared to 2011 primarily related to decreased outside services . g & a expenses consist primarily of salaries and other related expenses of administrative , executive and financial personnel and outside professional fees . - 19 - in 2011 , increases in g & a expenses and increases in r & d expenses were partially offset by decreases in selling expenses . g & a expenses increased $ 1.7 million in 2011 as compared to 2010 primarily related to increased compensation and increased outside services . r & d expenses increased $ 199,000 in 2011 as compared to 2010 primarily related to increased compensation costs , increased supplies costs and increased outside services . in 2011 , selling expenses decreased $ 43,000 primarily related to decreased compensation and promotional expenses . our operating income for 2012 was $ 33.6 million , compared with $ 38.2 million in 2011 and $ 31.0 million in 2010. operating income was 28 percent of revenues for 2012 , 32 percent of revenues for 2011 and 29 percent of revenues for 2010. the decrease in gross profit and the increase in operating expenses described above were the major contributors to the operating income decrease in 2012 compared to the previous year . the increase in gross profit partially offset by the increase in operating expenses described above was the major contributor to the operating income improvement in 2011 compared to the previous year . during 2013 we anticipate increases in r & d expenses and depreciation charges . story_separator_special_tag after taking these items into consideration , we expect growth in our operating income during 2013 as compared to 2012. our interest income for 2012 was $ 1.4 million compared with $ 1.3 million in 2011 and $ 1.0 million in 2010. the increases in 2012 and 2011 were primarily related to the increased levels of cash and investments during 2012 and 2011. results for 2012 and 2011 were also favorably impacted by investing in bonds with slightly longer maturities and higher yields . income tax expense in 2012 totaled $ 11.4 million , compared with $ 13.4 million in 2011 and $ 11.0 million in 2010. the effective tax rates for 2012 , 2011 and 2010 were 32.6 percent , 34.0 percent and 34.5 percent , respectively . the decrease in our effective tax rate for 2012 was primarily related to a favorable adjustment to an uncertain tax position related to income tax credits claimed for research and development following the conclusion of an internal revenue service examination of our united states federal income tax returns for 2006 , 2007 and 2008. benefits from tax incentives for domestic production totaled $ 949,000 in 2012 , $ 996,000 in 2011 and $ 957,000 in 2010. benefits from changes in uncertain tax positions totaled $ 720,000 in 2012 and $ 159,000 in 2011. expenses from changes in uncertain tax positions totaled $ 255,000 in 2010. we expect our effective tax rate for 2013 to be approximately 33.5 percent . story_separator_special_tag inflation primarily in the prices we pay for labor , materials and services . over the last three years , we have experienced the effects of moderate inflation in these costs . at times , we have been able to offset a portion of these increased costs by increasing the sales prices of our products . however , competitive pressures have not allowed for full recovery of these cost increases . new accounting pronouncements from time to time , new accounting standards updates applicable to us are issued by the fasb , which we will adopt as of the specified effective date . unless otherwise discussed , we believe the impact of recently issued standards updates that are not yet effective will not have a material impact on our consolidated financial statements upon adoption . critical accounting policies the discussion and analysis of our financial condition and results of operations are based on our consolidated financial statements , which have been prepared in accordance with accounting principles generally accepted in the united states . in the preparation of these financial statements , we make estimates and assumptions that affect the reported amounts of assets , liabilities , revenues and expenses , and related disclosures of contingent assets and liabilities . we believe the following discussion addresses our most critical accounting policies and estimates , which are those that are most important to the portrayal of our financial condition and results and require management 's most difficult , subjective and complex judgments , often as a result of the need to make estimates about the effect of matters that are inherently uncertain . actual results could differ significantly from those estimates under different assumptions and conditions . from time to time , we accrue legal costs associated with certain litigation . in making determinations of likely outcomes of litigation matters , we consider the evaluation of legal counsel knowledgeable about each matter , case law and other case-specific issues . we believe these accruals are adequate to cover the legal fees and expenses associated with litigating these matters . however , the time and cost required to litigate these matters as well as the outcomes of the proceedings may vary from what we have projected . we maintain an allowance for doubtful accounts to reflect estimated losses resulting from the failure of customers to make required payments . on an ongoing basis , the collectability of accounts receivable is assessed based upon historical collection trends , current economic factors and the assessment of the collectability of specific accounts . we evaluate the collectability of specific accounts and determine when to grant credit to our customers using a combination of factors , including the age of the outstanding balances , evaluation of customers ' current and past financial condition , recent payment history , current economic environment , and discussions with our personnel and with the customers directly . accounts are written off when it is determined the receivable will not be collected . if circumstances change , our estimates of the collectability of amounts could be changed by a material amount . we are required to estimate our provision for income taxes and uncertain tax positions in each of the jurisdictions in which we operate . this process involves estimating our actual current tax exposure , including assessing the risks associated with tax audits , together with assessing temporary differences resulting from the different treatment of items for tax and accounting purposes . these differences result in deferred tax assets and liabilities , which are included within the balance sheet . we assess the likelihood that our deferred tax assets will be recovered from future taxable income and , to the extent we believe that recovery is more likely than not , do not establish a valuation allowance . in the event that actual results differ from these estimates , the provision for income taxes could be materially impacted . - 22 - we assess the impairment of our long-lived identifiable assets , excluding goodwill which is tested for impairment as explained below , whenever events or changes in circumstances indicate that the carrying value may not be recoverable . this review is based upon projections of anticipated future cash flows . although we believe that our estimates of future cash flows are reasonable , different assumptions regarding such cash flows or future changes in our business plan could materially affect our evaluations . no such changes are anticipated at this time

our sales and technical support teams are localized in several growing markets . we operate a 200mm wafer fabrication facility located in hillsboro , oregon , or the oregon fab , which is critical for us to accelerate proprietary technology development , new product introduction and improve our financial performance in the long run . to meet the market demand for the more mature high volume products , we also utilize the wafer manufacturing capacity of selected third party foundries . for assembly and test , we primarily rely upon our in-house facilities in china . in addition , we utilize subcontracting partners for industry standard packages . we believe our in-house packaging and testing capability provides us with a competitive advantage in proprietary packaging technology , product quality , cost and sales cycle time . factors affecting our performance our performance is affected by several key factors , including the following : the global , regional economic and pc market conditions : because our products primarily serve consumer electronic applications , a deterioration of the global and regional economic conditions could materially affect our revenue and results of operations . in particular , because a significant amount of our revenue is derived from sales of products in the personal computer , or pc markets , such as notebooks , motherboards and notebook battery packs , a significant decline or downturn in the pc markets can have a material adverse effect on our revenue and results of operations . any decline in the pc markets would 39 have a material negative impact on the demand for our products , revenue , factory utilization , gross margin , our ability to resell excess inventory , and other performance measures . we have been executing and are continuing to execute strategies to diversify our product portfolio and penetrate into other market segments , such as the consumer , communication and industrial market segments , which we believe would mitigate and eventually overcome the reduced demand resulting from the declining pc markets . as we develop and sell new products that serve more diversified markets , we expect that sales based on the pc markets , as a percentage of the total revenue , will continue to decline . our revenue from the pc markets accounted for approximately 45.2 % , 50.0 % and 54.4 % of our total revenue for the years ended june 30 , 2014 , 2013 and 2012 , respectively . however , if the rate of decline in the pc markets is faster than we expected , or if we can not successfully diversify or introduce new products to keep pace with the declining pc markets , we may not be able to alleviate its negative impact , which will adversely affect our results of operations . erosion of average selling price : erosion of average selling prices of established products is typical in our industry . consistent with this historical trend , we expect that average selling prices of our existing products will continue to decline in the future . however , as a normal course of business , we seek to offset the effect of declining average selling prices by introducing new and higher value products , expanding existing products for new applications and new customers , and reducing manufacturing cost of existing products . product introductions and customers ' product requirements : our success depends on our ability to introduce products on a timely basis that meet or are compatible with our customers ' specifications and performance requirements . both factors , timeliness of product introductions and conformance to customers ' requirements , are equally important in securing design wins with our customers . as we accelerate the development of new technology platforms , we expect to increase the pace at which we introduce new products and obtain design wins . our failure to introduce products on a timely basis that meet customers ' specifications and performance requirements , particularly those products with major oem customers , and our inability to continue to expand our serviceable markets , could adversely affect our financial performance , including loss of market shares with customers . distributor ordering patterns and seasonality : our distributors place purchase orders with us based on their forecasts of end customer demand , and this demand may vary significantly depending on the sales outlooks and market and economic conditions of end customers . because these forecasts may not be accurate , channel inventory held at our distributors may fluctuate significantly , which in turn may prompt distributors to make significant adjustments to their purchase orders placed with us . as a result , our revenue and operating results may fluctuate significantly from quarter to quarter . in addition , because our products are used in consumer electronics products , our revenue is subject to seasonality . our sales seasonality is affected by numerous factors , including global and regional economic conditions as well as the pc market conditions , revenue generated from new products , changes in distributor ordering patterns in response to channel inventory adjustments and end customer demand for our products and fluctuations in consumer purchase patterns prior to major holiday seasons . in recent periods , broad fluctuations in the semiconductor markets and the global and regional economic conditions , in particular the decline of the pc market conditions , have had a more significant impact on our results of operations than seasonality . manufacturing costs : our gross margin may be affected by our manufacturing costs , including utilization of our own manufacturing facilities , pricing of wafers from other foundries and semiconductor raw materials , which may fluctuate from time to time largely due to the market demand and supply . capacity utilization affects our gross margin because we have certain fixed costs associated with our in-house packaging and testing facilities and our oregon fab . story_separator_special_tag in our review , we reconsidered the key assumptions in our overall strategic business and manufacturing capacity plans in light of the continued declines in the pc market . as a result , we revised our pc related revenue and volume outlook as well as our manufacturing capacity requirements . these material changes in our outlook and plans , which we were able to determine in the third quarter of fiscal 2013 , triggered an impairment review of our long-lived assets . we determined that the related estimated undiscounted cash flows were not sufficient to recover the carrying value of certain manufacturing machinery and equipment primarily for the packaging of our pc-related products due to the accelerated decline of the pc markets . the average remaining useful life of those impaired assets was approximately two years . we estimated the fair values of those long-lived assets based on net realizable values of similar machinery and equipment recently transacted by third-party used-machine brokers and recorded an asset impairment charge of approximately $ 2.6 million to reduce the related carrying amount to its estimated fair value as of march 31 , 2013. during the fourth quarter of fiscal year 2014 , we evaluated our amortizable intangible assets for impairment and determined that the related estimated undiscounted cash flows exceeded the carrying value of the intangible assets and no impairment charge was recorded . during the same period , we also evaluated our goodwill for impairment and determined that the fair value of the reporting unit , estimated based on the market capitalization approach , was more than its carrying value and no impairment charge was recorded . interest income and expenses interest income was primarily related to interest earned from cash and cash equivalents . the increase in interest income for fiscal year 2014 as compared to fiscal year 2013 was primarily due to increase in average cash balances . the decrease in interest income for fiscal year 2013 as compared to fiscal year 2012 was primarily due to lower average interest rate . interest expense was primarily related to bank borrowings . the decrease in interest expenses for fiscal year 2014 was primarily due to a decrease in bank borrowings related to $ 20.0 million term loan obtained in may 2012 for our oregon fab as compared to fiscal year 2013 . the increase in interest expenses for fiscal year 2013 was primarily due to an increase in bank borrowings , including the $ 20.0 million term loan obtained in may 2012 for working capital of our oregon fab as compared to fiscal year 2012 . 45 income tax expense replace_table_token_9_th fiscal 2014 vs 2013 income tax expense for fiscal years 2014 and 2013 was $ 3.0 million and $ 4.0 million , respectively . income tax expense decreased by $ 1.0 million , or 25.7 % , in fiscal year 2014 as compared to fiscal year 2013 primarily due to a reduction in our uncertain tax positions offset partially by a change in the mix of earnings in various geographic jurisdictions . fiscal 2013 vs 2012 income tax expense for fiscal years 2013 and 2012 was $ 4.0 million and $ 3.6 million , respectively . income tax expense increased by $ 0.4 million , or 11.7 % , in fiscal year 2013 as compared to fiscal year 2012 primarily due to the changes in the mix of earnings in various geographic jurisdictions , which was partially offset by the tax benefits from the january 2013 reinstatement of the u.s. federal r & d credit retroactive to january 1 , 2012. liquidity and capital resources our principal need for liquidity and capital resources is to maintain sufficient working capital to support our operations and to invest adequate capital expenditures to fuel the growth of our business . currently , we primarily financed our operations and capital expenditures through funds generated from operations . on may 11 , 2012 , we entered into a loan agreement with a financial institution that provides a term loan of $ 20.0 million for general purposes and a $ 10.0 million non-revolving credit line for the purchase of equipment . both the term loan and equipment credit line will be fully repayable in may 2015. the borrowings may be made in the form of either eurodollar loans or base rate loans . eurodollar loans accrue interest based on an adjusted london interbank offer rate ( `` libor `` ) as defined in the agreement , plus a margin of 1.00 % to 1.75 % . base rate loans accrue interest at the highest of ( a ) the lender 's prime rate , ( b ) the federal funds rate plus 0.5 % and ( c ) the eurodollar rate ( for a one-month interest period ) plus 1 % ; plus a margin of -0.5 % to 0.25 % . the applicable margins for both eurodollar loans and base rate loans will vary from time to time in the foregoing ranges based on the cash and cash equivalent balances maintained by us and our subsidiaries with the lender . in may 2013 , the equipment credit line expired and there was no outstanding balance . as of july 31 , 2014 and 2013 , the outstanding balance of the term loan was $ 13.5 million and $ 16.4 million , respectively . the obligations under the loan agreement are secured by substantially all assets of two of our subsidiaries , including but not limited to , certain real property and related assets located at the oregon fab . in addition , we and certain of our subsidiaries have agreed to guarantee full repayment and performance of the obligations under the loan agreement . the loan agreement contains customary restrictive covenants and includes certain financial covenants that require us to maintain on a consolidated basis specified financial ratios including total liabilities to tangible net worth , fixed charge coverage and current assets to current liabilities

net cash provided by operating activities of $ 37.6 million for fiscal year 2014 resulted primarily from net loss of $ 3.3 million , non-cash charges of $ 31.5 million and net change in assets and liabilities providing net cash of $ 9.4 million . the non-cash charges of $ 31.5 million included depreciation and amortization expenses of $ 27.9 million , share-based compensation expense of $ 3.4 million , and net deferred income taxes of $ 0.8 million , partially offset by allowance for doubtful account of $ 0.4 million and gain on disposal of property and equipment of $ 0.2 million during the fiscal year 2014. the net change in assets and liabilities providing net cash of $ 9.4 million was primarily due to $ 1.8 million decrease in inventories as we reduced our inventories , $ 2.1 million decrease in accounts receivable due to the timing of billings and collection of payments , $ 5.5 million increase in accounts payable primarily due to increase in inventory purchase and timing of payment , and $ 2.4 million increase in accrued and other liabilities primarily related to employee compensation and performance bonuses , partially offset by $ 0.9 million decrease in income taxes payable , and $ 1.5 million increase in other current and long-term assets primarily due to increase in advance payments to suppliers . net cash provided by operating activities of $ 28.0 million for fiscal year 2013 resulted primarily from net loss of $ 5.6 million , non-cash charges of $ 37.8 million and net change in assets and liabilities using net cash of $ 4.2 million .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```net cash provided by operating activities of $ 37.6 million for fiscal year 2014 resulted primarily from net loss of $ 3.3 million , non-cash charges of $ 31.5 million and net change in assets and liabilities providing net cash of $ 9.4 million . the non-cash charges of $ 31.5 million included depreciation and amortization expenses of $ 27.9 million , share-based compensation expense of $ 3.4 million , and net deferred income taxes of $ 0.8 million , partially offset by allowance for doubtful account of $ 0.4 million and gain on disposal of property and equipment of $ 0.2 million during the fiscal year 2014. the net change in assets and liabilities providing net cash of $ 9.4 million was primarily due to $ 1.8 million decrease in inventories as we reduced our inventories , $ 2.1 million decrease in accounts receivable due to the timing of billings and collection of payments , $ 5.5 million increase in accounts payable primarily due to increase in inventory purchase and timing of payment , and $ 2.4 million increase in accrued and other liabilities primarily related to employee compensation and performance bonuses , partially offset by $ 0.9 million decrease in income taxes payable , and $ 1.5 million increase in other current and long-term assets primarily due to increase in advance payments to suppliers . net cash provided by operating activities of $ 28.0 million for fiscal year 2013 resulted primarily from net loss of $ 5.6 million , non-cash charges of $ 37.8 million and net change in assets and liabilities using net cash of $ 4.2 million . ``` Suspicious Activity Report : our sales and technical support teams are localized in several growing markets . we operate a 200mm wafer fabrication facility located in hillsboro , oregon , or the oregon fab , which is critical for us to accelerate proprietary technology development , new product introduction and improve our financial performance in the long run . to meet the market demand for the more mature high volume products , we also utilize the wafer manufacturing capacity of selected third party foundries . for assembly and test , we primarily rely upon our in-house facilities in china . in addition , we utilize subcontracting partners for industry standard packages . we believe our in-house packaging and testing capability provides us with a competitive advantage in proprietary packaging technology , product quality , cost and sales cycle time . factors affecting our performance our performance is affected by several key factors , including the following : the global , regional economic and pc market conditions : because our products primarily serve consumer electronic applications , a deterioration of the global and regional economic conditions could materially affect our revenue and results of operations . in particular , because a significant amount of our revenue is derived from sales of products in the personal computer , or pc markets , such as notebooks , motherboards and notebook battery packs , a significant decline or downturn in the pc markets can have a material adverse effect on our revenue and results of operations . any decline in the pc markets would 39 have a material negative impact on the demand for our products , revenue , factory utilization , gross margin , our ability to resell excess inventory , and other performance measures . we have been executing and are continuing to execute strategies to diversify our product portfolio and penetrate into other market segments , such as the consumer , communication and industrial market segments , which we believe would mitigate and eventually overcome the reduced demand resulting from the declining pc markets . as we develop and sell new products that serve more diversified markets , we expect that sales based on the pc markets , as a percentage of the total revenue , will continue to decline . our revenue from the pc markets accounted for approximately 45.2 % , 50.0 % and 54.4 % of our total revenue for the years ended june 30 , 2014 , 2013 and 2012 , respectively . however , if the rate of decline in the pc markets is faster than we expected , or if we can not successfully diversify or introduce new products to keep pace with the declining pc markets , we may not be able to alleviate its negative impact , which will adversely affect our results of operations . erosion of average selling price : erosion of average selling prices of established products is typical in our industry . consistent with this historical trend , we expect that average selling prices of our existing products will continue to decline in the future . however , as a normal course of business , we seek to offset the effect of declining average selling prices by introducing new and higher value products , expanding existing products for new applications and new customers , and reducing manufacturing cost of existing products . product introductions and customers ' product requirements : our success depends on our ability to introduce products on a timely basis that meet or are compatible with our customers ' specifications and performance requirements . both factors , timeliness of product introductions and conformance to customers ' requirements , are equally important in securing design wins with our customers . as we accelerate the development of new technology platforms , we expect to increase the pace at which we introduce new products and obtain design wins . our failure to introduce products on a timely basis that meet customers ' specifications and performance requirements , particularly those products with major oem customers , and our inability to continue to expand our serviceable markets , could adversely affect our financial performance , including loss of market shares with customers . distributor ordering patterns and seasonality : our distributors place purchase orders with us based on their forecasts of end customer demand , and this demand may vary significantly depending on the sales outlooks and market and economic conditions of end customers . because these forecasts may not be accurate , channel inventory held at our distributors may fluctuate significantly , which in turn may prompt distributors to make significant adjustments to their purchase orders placed with us . as a result , our revenue and operating results may fluctuate significantly from quarter to quarter . in addition , because our products are used in consumer electronics products , our revenue is subject to seasonality . our sales seasonality is affected by numerous factors , including global and regional economic conditions as well as the pc market conditions , revenue generated from new products , changes in distributor ordering patterns in response to channel inventory adjustments and end customer demand for our products and fluctuations in consumer purchase patterns prior to major holiday seasons . in recent periods , broad fluctuations in the semiconductor markets and the global and regional economic conditions , in particular the decline of the pc market conditions , have had a more significant impact on our results of operations than seasonality . manufacturing costs : our gross margin may be affected by our manufacturing costs , including utilization of our own manufacturing facilities , pricing of wafers from other foundries and semiconductor raw materials , which may fluctuate from time to time largely due to the market demand and supply . capacity utilization affects our gross margin because we have certain fixed costs associated with our in-house packaging and testing facilities and our oregon fab . story_separator_special_tag in our review , we reconsidered the key assumptions in our overall strategic business and manufacturing capacity plans in light of the continued declines in the pc market . as a result , we revised our pc related revenue and volume outlook as well as our manufacturing capacity requirements . these material changes in our outlook and plans , which we were able to determine in the third quarter of fiscal 2013 , triggered an impairment review of our long-lived assets . we determined that the related estimated undiscounted cash flows were not sufficient to recover the carrying value of certain manufacturing machinery and equipment primarily for the packaging of our pc-related products due to the accelerated decline of the pc markets . the average remaining useful life of those impaired assets was approximately two years . we estimated the fair values of those long-lived assets based on net realizable values of similar machinery and equipment recently transacted by third-party used-machine brokers and recorded an asset impairment charge of approximately $ 2.6 million to reduce the related carrying amount to its estimated fair value as of march 31 , 2013. during the fourth quarter of fiscal year 2014 , we evaluated our amortizable intangible assets for impairment and determined that the related estimated undiscounted cash flows exceeded the carrying value of the intangible assets and no impairment charge was recorded . during the same period , we also evaluated our goodwill for impairment and determined that the fair value of the reporting unit , estimated based on the market capitalization approach , was more than its carrying value and no impairment charge was recorded . interest income and expenses interest income was primarily related to interest earned from cash and cash equivalents . the increase in interest income for fiscal year 2014 as compared to fiscal year 2013 was primarily due to increase in average cash balances . the decrease in interest income for fiscal year 2013 as compared to fiscal year 2012 was primarily due to lower average interest rate . interest expense was primarily related to bank borrowings . the decrease in interest expenses for fiscal year 2014 was primarily due to a decrease in bank borrowings related to $ 20.0 million term loan obtained in may 2012 for our oregon fab as compared to fiscal year 2013 . the increase in interest expenses for fiscal year 2013 was primarily due to an increase in bank borrowings , including the $ 20.0 million term loan obtained in may 2012 for working capital of our oregon fab as compared to fiscal year 2012 . 45 income tax expense replace_table_token_9_th fiscal 2014 vs 2013 income tax expense for fiscal years 2014 and 2013 was $ 3.0 million and $ 4.0 million , respectively . income tax expense decreased by $ 1.0 million , or 25.7 % , in fiscal year 2014 as compared to fiscal year 2013 primarily due to a reduction in our uncertain tax positions offset partially by a change in the mix of earnings in various geographic jurisdictions . fiscal 2013 vs 2012 income tax expense for fiscal years 2013 and 2012 was $ 4.0 million and $ 3.6 million , respectively . income tax expense increased by $ 0.4 million , or 11.7 % , in fiscal year 2013 as compared to fiscal year 2012 primarily due to the changes in the mix of earnings in various geographic jurisdictions , which was partially offset by the tax benefits from the january 2013 reinstatement of the u.s. federal r & d credit retroactive to january 1 , 2012. liquidity and capital resources our principal need for liquidity and capital resources is to maintain sufficient working capital to support our operations and to invest adequate capital expenditures to fuel the growth of our business . currently , we primarily financed our operations and capital expenditures through funds generated from operations . on may 11 , 2012 , we entered into a loan agreement with a financial institution that provides a term loan of $ 20.0 million for general purposes and a $ 10.0 million non-revolving credit line for the purchase of equipment . both the term loan and equipment credit line will be fully repayable in may 2015. the borrowings may be made in the form of either eurodollar loans or base rate loans . eurodollar loans accrue interest based on an adjusted london interbank offer rate ( `` libor `` ) as defined in the agreement , plus a margin of 1.00 % to 1.75 % . base rate loans accrue interest at the highest of ( a ) the lender 's prime rate , ( b ) the federal funds rate plus 0.5 % and ( c ) the eurodollar rate ( for a one-month interest period ) plus 1 % ; plus a margin of -0.5 % to 0.25 % . the applicable margins for both eurodollar loans and base rate loans will vary from time to time in the foregoing ranges based on the cash and cash equivalent balances maintained by us and our subsidiaries with the lender . in may 2013 , the equipment credit line expired and there was no outstanding balance . as of july 31 , 2014 and 2013 , the outstanding balance of the term loan was $ 13.5 million and $ 16.4 million , respectively . the obligations under the loan agreement are secured by substantially all assets of two of our subsidiaries , including but not limited to , certain real property and related assets located at the oregon fab . in addition , we and certain of our subsidiaries have agreed to guarantee full repayment and performance of the obligations under the loan agreement . the loan agreement contains customary restrictive covenants and includes certain financial covenants that require us to maintain on a consolidated basis specified financial ratios including total liabilities to tangible net worth , fixed charge coverage and current assets to current liabilities

the company began originating consumer indirect loans in the state of california in 2012 with $ 2.5 million in these loans originated during 2012. in 2016 , the company originated $ 20.5 million in the state of california and held $ 36.5 million in california originated consumer loans at december 31 , 2016. management has established a concentration limit of no more than 56 100 % of the bank 's total risk-based capital . at december 31 , 2016 , the limit was $ 93.3 million . see item 1a , “ risk factors - our business could suffer if we are unsuccessful in making , continuing and growing relationships with home improvement contractors and dealers ” of this form 10-k. since 2012 , the company has had an emphasis on diversifying lending products by expanding commercial real estate , commercial business and residential lending , while maintaining the current size of the consumer loan portfolio . the company 's lending strategies are intended to take advantage of : ( 1 ) historical strength in indirect consumer lending , ( 2 ) recent market consolidation that has created new lending opportunities and the availability of experienced bankers , and ( 3 ) strength in relationship lending . retail deposits will continue to serve as an important funding source . see item 1 , “ business : lending activities ” and item 1a , “ risk factors - risks related to our business ” in this form 10-k. the company generally underwrites the one-to-four-family loans based on the applicant 's ability to repay . this includes employment and credit history and the appraised value of the subject property . the company lends up to 100 % of the lesser of the appraised value or purchase price for one-to-four-family first mortgage loans . for first mortgage loans with a loan-to-value ratio in excess of 80 % , the company generally requires either private mortgage insurance or government sponsored insurance in order to mitigate the higher risk level associated with higher loan-to-value loans . fixed-rate loans secured by one-to-four-family residences have contractual maturities of up to 30 years and are generally fully amortizing , with payments due monthly . adjustable-rate mortgage loans may pose different credit risks than fixed-rate loans , primarily because as interest rates increase , the borrower 's payments rise , increasing the potential for default . properties securing the one-to-four-family loans are appraised by independent fee appraisers who are selected in accordance with industry and regulatory standards . the company requires borrowers to obtain title and hazard insurance , and flood insurance , if necessary . loans are generally underwritten to the secondary market guidelines with additional requirements as determined by the internal underwriting department . the company is significantly affected by prevailing economic conditions , as well as government policies and regulations concerning , among other things , monetary and fiscal affairs . deposit flows are influenced by a number of factors , including interest rates paid on time deposits , other investments , account maturities , and the overall level of personal income and savings . lending activities are influenced by the demand for funds , the number and quality of lenders , and regional economic cycles . sources of funds for lending activities include primarily deposits , including brokered deposits , borrowings , payments on loans and income provided from operations . the company 's earnings are primarily dependent upon net interest income , the difference between interest income and interest expense . interest income is a function of the balances of loans and investments outstanding during a given period and the yield earned on these loans and investments . interest expense is a function of the amount of deposits and borrowings outstanding during the same period and interest rates paid on these deposits and borrowings . another significant influence on the company 's earnings is fee income from mortgage banking activities . the company 's earnings are also affected by the provision for loan losses , service charges and fees , gains from sales of assets , operating expenses and income taxes . critical accounting policies and estimates certain of the company 's accounting policies are important to the portrayal of the company 's financial condition , since they require management to make difficult , complex or subjective judgments , some of which may relate to matters that are inherently uncertain . estimates associated with these policies are susceptible to material changes as a result of changes in facts and circumstances . facts and circumstances which could affect these judgments include , but are not limited to , changes in interest rates , changes in the performance of the economy and changes in the financial condition of borrowers . management believes that its critical accounting policies include determining the allowance for loan losses , the fair value of servicing rights , derivatives and hedging activity , and the accounting for deferred income taxes . the company 's accounting policies are discussed in detail in note 1 of the notes to consolidated financial statements included in item 8 , “ financial statements and supplementary data ” of this form 10-k. allowance for loan loss . the allowance for loan losses is the amount estimated by management as necessary to cover probable losses inherent in the loan portfolio at the balance sheet date . the allowance is established through the provision for loan losses , which is charged to income . a high degree of judgment is necessary when determining the amount of the allowance for loan losses . among the material estimates required to establish the allowance are : loss 57 exposure at default ; the amount and timing of future cash flows on impacted loans ; value of collateral ; and determination of loss factors to be applied to the various elements of the portfolio . all of these estimates are susceptible to significant change . story_separator_special_tag at december 31 , 2016 , total debt was $ 22.5 million consisting of borrowings of $ 12.7 million and a subordinated note , net of $ 9.8 million , compared to a total debt of $ 108.6 million at december 31 , 2015. borrowings decreased $ 86.1 million , or 87.2 % , to $ 12.7 million at december 31 , 2016 , from $ 98.8 million at december 31 , 2015 , primarily due to the cash received in the branch purchase being utilized to repay fhlb advances . stockholders ' equity . total stockholders ' equity increased $ 5.7 million , or 7.6 % , to $ 81.0 million at december 31 , 2016 , from $ 75.3 million at december 31 , 2015. the increase in stockholders ' equity was predominately a result of net income of $ 10.5 million , primarily offset by $ 4.9 million in common stock repurchases . during the year ended december 31 , 2016 , the company repurchased 198,000 shares of its common stock , of which 193,000 shares were purchased in accordance with its stock repurchase plan at an average price per share of $ 24.79. the company 's stock repurchase plan announced on july 28 , 2015 , ended on august 31 , 2016. book value per common share was $ 28.32 at december 31 , 2016 , compared to $ 25.18 at december 31 , 2015 . 61 average balances , interest and average yields/cost the following table sets forth for the periods indicated , information regarding average balances of assets and liabilities as well as the total dollar amounts of interest income from average interest-earning assets and interest expense on average interest-bearing liabilities , resultant yields , interest rate spread , net interest margin ( otherwise known as net yield on interest-earning assets ) , and the ratio of average interest-earning assets to average interest-bearing liabilities . also presented is the weighted average yield on interest-earning assets , rates paid on interest-bearing liabilities and the resultant spread at december 31 , 2016. income and all average balances are monthly average balances . non-accruing loans have been included in the table as loans carrying a zero yield . replace_table_token_25_th _ ( 1 ) the average loans receivable , net balances include non-accruing loans . 62 rate/volume analysis the following table presents the dollar amount of changes in interest income and interest expense for major components of interest-earning assets and interest-bearing liabilities . it distinguishes between the changes related to outstanding balances and that due to the changes in interest rates . for each category of interest-earning assets and interest-bearing liabilities , information is provided on changes attributable to ( i ) changes in volume ( i.e . , changes in volume multiplied by old rate ) and ( ii ) changes in rate ( i.e . , changes in rate multiplied by old volume ) . for purposes of this table , changes attributable to both rate and volume , which can not be segregated , have been allocated proportionately to the change due to volume and the change due to rate . replace_table_token_26_th ( 1 ) the average loans receivable , net balances include non-accruing loans . comparison of results of operations for the years ended december 31 , 2016 and 2015 general . net income for the year ended december 31 , 2016 , increased $ 1.6 million , or 18.3 % , to $ 10.5 million , from $ 8.9 million for the year ended december 31 , 2015. the increase in net income was primarily a result of a $ 6.3 million , or 19.9 % increase in interest income , and a 6.0 million , or 34.0 % increase in noninterest income , partially offset by a $ 9.3 million , or 31.3 % increase in noninterest expense , a $ 731,000 , or 15.0 % increase in the provision for income tax expense and $ 505,000 , or 13.8 % increase in interest expense . net interest income . net interest income increased $ 5.8 million , or 20.7 % , to $ 33.9 million for the year ended december 31 , 2016 , from $ 28.0 million for the year ended december 31 , 2015. the increase in net interest income was primarily attributable to a $ 5.4 million , or 17.6 % increase in loan receivable interest income resulting from a $ 127.8 million increase in average loans receivable , net and loans held for sale over the last year , a $ 1.0 million , or 74.4 % increase in interest and dividends on investment securities , and cash and cash equivalents , primarily offset by a $ 539,000 , or 374.3 % increase in subordinated note interest expense . the subordinated note was issued on october 15 , 2015 . 63 the net interest margin ( “ nim ” ) decreased 58 basis points to 4.43 % for the year ended december 31 , 2016 , from 5.01 % for the same period last year . the decreased nim reflects continued growth in diversified , lower yielding assets including loan and investment assets . as a percentage , consumer loans to total loans were 28.9 % at december 31 , 2016 , compared to 31.0 % at december 31 , 2015 , reflecting our loan diversification strategy . the average cost of funds for total interest-bearing liabilities decreased nine basis points to 0.74 % for the year ended december 31 , 2016 , from 0.83 % for the year ended december 31 , 2015. the decrease primarily reflects a significant amount of relatively low cost relationship-based transactional deposits acquired in the branch purchase and the decline in the percentage of higher cost certificates of deposit to total deposits over the last year . the decrease does not reflect the $ 152.9 million in noninterest-bearing deposits that reduced our overall cost of deposits . management remains focused on

liquidity management maintains a liquidity position that it believes will adequately provide funding for loan demand and deposit runoff that may occur in the normal course of business . the company relies on a number of different sources in order to meet potential liquidity demands . the primary sources are increases in deposit accounts , fhlb advances , purchases of fed funds , sale of securities available-for-sale , cash flows from loan payments , sales of one-to-four-family loans held for sale , and maturing securities . at december 31 , 2016 , the bank 's total borrowing capacity was $ 191.1 million with the fhlb of des moines , with unused borrowing capacity of $ 177.5 million at that date . the fhlb borrowing limit is based on certain categories of loans , primarily real estate loans that qualify as collateral for fhlb advances . at december 31 , 2016 , the bank held approximately $ 249.8 million in loans that qualify as collateral for fhlb advances . in addition to the availability of liquidity from the fhlb of des moines , the bank maintained a short-term borrowing line with the federal reserve bank , with a current limit of $ 85.9 million , and a combined credit limit of $ 40.0 million in written fed funds lines of credit through correspondent banking relationships as of december 31 , 2016. the federal reserve bank borrowing limit is based on certain categories of loans , primarily consumer loansthat qualify as collateral for federal reserve bank line of credit .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```liquidity management maintains a liquidity position that it believes will adequately provide funding for loan demand and deposit runoff that may occur in the normal course of business . the company relies on a number of different sources in order to meet potential liquidity demands . the primary sources are increases in deposit accounts , fhlb advances , purchases of fed funds , sale of securities available-for-sale , cash flows from loan payments , sales of one-to-four-family loans held for sale , and maturing securities . at december 31 , 2016 , the bank 's total borrowing capacity was $ 191.1 million with the fhlb of des moines , with unused borrowing capacity of $ 177.5 million at that date . the fhlb borrowing limit is based on certain categories of loans , primarily real estate loans that qualify as collateral for fhlb advances . at december 31 , 2016 , the bank held approximately $ 249.8 million in loans that qualify as collateral for fhlb advances . in addition to the availability of liquidity from the fhlb of des moines , the bank maintained a short-term borrowing line with the federal reserve bank , with a current limit of $ 85.9 million , and a combined credit limit of $ 40.0 million in written fed funds lines of credit through correspondent banking relationships as of december 31 , 2016. the federal reserve bank borrowing limit is based on certain categories of loans , primarily consumer loansthat qualify as collateral for federal reserve bank line of credit . ``` Suspicious Activity Report : the company began originating consumer indirect loans in the state of california in 2012 with $ 2.5 million in these loans originated during 2012. in 2016 , the company originated $ 20.5 million in the state of california and held $ 36.5 million in california originated consumer loans at december 31 , 2016. management has established a concentration limit of no more than 56 100 % of the bank 's total risk-based capital . at december 31 , 2016 , the limit was $ 93.3 million . see item 1a , “ risk factors - our business could suffer if we are unsuccessful in making , continuing and growing relationships with home improvement contractors and dealers ” of this form 10-k. since 2012 , the company has had an emphasis on diversifying lending products by expanding commercial real estate , commercial business and residential lending , while maintaining the current size of the consumer loan portfolio . the company 's lending strategies are intended to take advantage of : ( 1 ) historical strength in indirect consumer lending , ( 2 ) recent market consolidation that has created new lending opportunities and the availability of experienced bankers , and ( 3 ) strength in relationship lending . retail deposits will continue to serve as an important funding source . see item 1 , “ business : lending activities ” and item 1a , “ risk factors - risks related to our business ” in this form 10-k. the company generally underwrites the one-to-four-family loans based on the applicant 's ability to repay . this includes employment and credit history and the appraised value of the subject property . the company lends up to 100 % of the lesser of the appraised value or purchase price for one-to-four-family first mortgage loans . for first mortgage loans with a loan-to-value ratio in excess of 80 % , the company generally requires either private mortgage insurance or government sponsored insurance in order to mitigate the higher risk level associated with higher loan-to-value loans . fixed-rate loans secured by one-to-four-family residences have contractual maturities of up to 30 years and are generally fully amortizing , with payments due monthly . adjustable-rate mortgage loans may pose different credit risks than fixed-rate loans , primarily because as interest rates increase , the borrower 's payments rise , increasing the potential for default . properties securing the one-to-four-family loans are appraised by independent fee appraisers who are selected in accordance with industry and regulatory standards . the company requires borrowers to obtain title and hazard insurance , and flood insurance , if necessary . loans are generally underwritten to the secondary market guidelines with additional requirements as determined by the internal underwriting department . the company is significantly affected by prevailing economic conditions , as well as government policies and regulations concerning , among other things , monetary and fiscal affairs . deposit flows are influenced by a number of factors , including interest rates paid on time deposits , other investments , account maturities , and the overall level of personal income and savings . lending activities are influenced by the demand for funds , the number and quality of lenders , and regional economic cycles . sources of funds for lending activities include primarily deposits , including brokered deposits , borrowings , payments on loans and income provided from operations . the company 's earnings are primarily dependent upon net interest income , the difference between interest income and interest expense . interest income is a function of the balances of loans and investments outstanding during a given period and the yield earned on these loans and investments . interest expense is a function of the amount of deposits and borrowings outstanding during the same period and interest rates paid on these deposits and borrowings . another significant influence on the company 's earnings is fee income from mortgage banking activities . the company 's earnings are also affected by the provision for loan losses , service charges and fees , gains from sales of assets , operating expenses and income taxes . critical accounting policies and estimates certain of the company 's accounting policies are important to the portrayal of the company 's financial condition , since they require management to make difficult , complex or subjective judgments , some of which may relate to matters that are inherently uncertain . estimates associated with these policies are susceptible to material changes as a result of changes in facts and circumstances . facts and circumstances which could affect these judgments include , but are not limited to , changes in interest rates , changes in the performance of the economy and changes in the financial condition of borrowers . management believes that its critical accounting policies include determining the allowance for loan losses , the fair value of servicing rights , derivatives and hedging activity , and the accounting for deferred income taxes . the company 's accounting policies are discussed in detail in note 1 of the notes to consolidated financial statements included in item 8 , “ financial statements and supplementary data ” of this form 10-k. allowance for loan loss . the allowance for loan losses is the amount estimated by management as necessary to cover probable losses inherent in the loan portfolio at the balance sheet date . the allowance is established through the provision for loan losses , which is charged to income . a high degree of judgment is necessary when determining the amount of the allowance for loan losses . among the material estimates required to establish the allowance are : loss 57 exposure at default ; the amount and timing of future cash flows on impacted loans ; value of collateral ; and determination of loss factors to be applied to the various elements of the portfolio . all of these estimates are susceptible to significant change . story_separator_special_tag at december 31 , 2016 , total debt was $ 22.5 million consisting of borrowings of $ 12.7 million and a subordinated note , net of $ 9.8 million , compared to a total debt of $ 108.6 million at december 31 , 2015. borrowings decreased $ 86.1 million , or 87.2 % , to $ 12.7 million at december 31 , 2016 , from $ 98.8 million at december 31 , 2015 , primarily due to the cash received in the branch purchase being utilized to repay fhlb advances . stockholders ' equity . total stockholders ' equity increased $ 5.7 million , or 7.6 % , to $ 81.0 million at december 31 , 2016 , from $ 75.3 million at december 31 , 2015. the increase in stockholders ' equity was predominately a result of net income of $ 10.5 million , primarily offset by $ 4.9 million in common stock repurchases . during the year ended december 31 , 2016 , the company repurchased 198,000 shares of its common stock , of which 193,000 shares were purchased in accordance with its stock repurchase plan at an average price per share of $ 24.79. the company 's stock repurchase plan announced on july 28 , 2015 , ended on august 31 , 2016. book value per common share was $ 28.32 at december 31 , 2016 , compared to $ 25.18 at december 31 , 2015 . 61 average balances , interest and average yields/cost the following table sets forth for the periods indicated , information regarding average balances of assets and liabilities as well as the total dollar amounts of interest income from average interest-earning assets and interest expense on average interest-bearing liabilities , resultant yields , interest rate spread , net interest margin ( otherwise known as net yield on interest-earning assets ) , and the ratio of average interest-earning assets to average interest-bearing liabilities . also presented is the weighted average yield on interest-earning assets , rates paid on interest-bearing liabilities and the resultant spread at december 31 , 2016. income and all average balances are monthly average balances . non-accruing loans have been included in the table as loans carrying a zero yield . replace_table_token_25_th _ ( 1 ) the average loans receivable , net balances include non-accruing loans . 62 rate/volume analysis the following table presents the dollar amount of changes in interest income and interest expense for major components of interest-earning assets and interest-bearing liabilities . it distinguishes between the changes related to outstanding balances and that due to the changes in interest rates . for each category of interest-earning assets and interest-bearing liabilities , information is provided on changes attributable to ( i ) changes in volume ( i.e . , changes in volume multiplied by old rate ) and ( ii ) changes in rate ( i.e . , changes in rate multiplied by old volume ) . for purposes of this table , changes attributable to both rate and volume , which can not be segregated , have been allocated proportionately to the change due to volume and the change due to rate . replace_table_token_26_th ( 1 ) the average loans receivable , net balances include non-accruing loans . comparison of results of operations for the years ended december 31 , 2016 and 2015 general . net income for the year ended december 31 , 2016 , increased $ 1.6 million , or 18.3 % , to $ 10.5 million , from $ 8.9 million for the year ended december 31 , 2015. the increase in net income was primarily a result of a $ 6.3 million , or 19.9 % increase in interest income , and a 6.0 million , or 34.0 % increase in noninterest income , partially offset by a $ 9.3 million , or 31.3 % increase in noninterest expense , a $ 731,000 , or 15.0 % increase in the provision for income tax expense and $ 505,000 , or 13.8 % increase in interest expense . net interest income . net interest income increased $ 5.8 million , or 20.7 % , to $ 33.9 million for the year ended december 31 , 2016 , from $ 28.0 million for the year ended december 31 , 2015. the increase in net interest income was primarily attributable to a $ 5.4 million , or 17.6 % increase in loan receivable interest income resulting from a $ 127.8 million increase in average loans receivable , net and loans held for sale over the last year , a $ 1.0 million , or 74.4 % increase in interest and dividends on investment securities , and cash and cash equivalents , primarily offset by a $ 539,000 , or 374.3 % increase in subordinated note interest expense . the subordinated note was issued on october 15 , 2015 . 63 the net interest margin ( “ nim ” ) decreased 58 basis points to 4.43 % for the year ended december 31 , 2016 , from 5.01 % for the same period last year . the decreased nim reflects continued growth in diversified , lower yielding assets including loan and investment assets . as a percentage , consumer loans to total loans were 28.9 % at december 31 , 2016 , compared to 31.0 % at december 31 , 2015 , reflecting our loan diversification strategy . the average cost of funds for total interest-bearing liabilities decreased nine basis points to 0.74 % for the year ended december 31 , 2016 , from 0.83 % for the year ended december 31 , 2015. the decrease primarily reflects a significant amount of relatively low cost relationship-based transactional deposits acquired in the branch purchase and the decline in the percentage of higher cost certificates of deposit to total deposits over the last year . the decrease does not reflect the $ 152.9 million in noninterest-bearing deposits that reduced our overall cost of deposits . management remains focused on

international in november 2016 , we signed an exclusive distribution agreement with medikit co. , ltd. ( “ medikit ” ) to sell our diamondback 360 ® coronary and peripheral oas in japan . in march 2017 , we received approval from japan 's ministry of health , labor and welfare for our diamondback 360 ® coronary oas micro crown . pending reimbursement approval , japan will be the first international market for any of our products . we are currently evaluating options for additional international markets to expand the coronary and peripheral opportunities . financial overview net revenues . we derive substantially all of our revenues from the sale of peripheral oas , the coronary oas and ancillary products . the peripheral oas and coronary oas each use a disposable , single-use , low-profile catheter that travels over our proprietary viperwire guide wire . the systems use a saline infusion pump as a power supply for the operation of the catheter . additional ancillary products include the viperslide lubricant and vipertrack radiopaque tape . cost of goods sold . we assemble the single-use catheter with components purchased from third-party suppliers , as well as with components manufactured in-house . the infusion pump and guide wires are purchased from third-party suppliers . our cost of goods sold consists primarily of raw materials , direct labor , and manufacturing overhead . selling , general and administrative expenses . selling , general and administrative expenses include compensation for executive , sales , marketing , finance , information technology , human resources and administrative personnel , including stock-based compensation . other significant expenses include the medical device excise tax , bad debt expense , travel , marketing costs , professional fees and professional education . research and development expenses . research and development expenses include costs associated with the design , development , testing , enhancement and regulatory approval of our products . research and development expenses include employee compensation including stock-based compensation , supplies and materials , patent expenses , consulting expenses , travel and facilities overhead . we also incur significant expenses to operate clinical trials , including trial design , third-party fees , clinical site reimbursement , data management and travel expenses . all research and development expenses are expensed as incurred . approved patent applications are capitalized and amortized using the straight-line method over their remaining estimated lives . patent amortization begins at the time of patent application approval , and does not exceed 20 years . other ( income ) and expense , net . other ( income ) and expense , net primarily includes interest expense from amounts owed under the facility lease and doj settlement , and interest income from money market funds . net operating loss carryforwards . we have established valuation allowances to fully offset our deferred tax assets due to the uncertainty about our ability to generate the future taxable income necessary to realize these deferred assets , particularly in light of our historical losses . the future use of net operating loss carryforwards is dependent on us attaining profitable operations and will be limited in any one year under internal revenue code section 382 due to significant ownership changes ( as defined in section 382 ) resulting from our equity financings . at june 30 , 2017 , we had net operating loss carryforwards for federal and state income tax reporting purposes of approximately $ 239.3 million , which will expire at various dates through fiscal 2036 . 33 critical accounting policies and significant judgments and estimates our management 's discussion and analysis of our financial condition and results of operations are based on our consolidated financial statements , which have been prepared in accordance with accounting principles generally accepted in the united states . the preparation of our consolidated financial statements requires us to make estimates , assumptions and judgments that affect amounts reported in those statements . our estimates , assumptions and judgments , including those related to revenue recognition , allowance for doubtful accounts , excess and obsolete inventory , and stock-based compensation are updated as appropriate at least quarterly . we use authoritative pronouncements , our technical accounting knowledge , cumulative business experience , valuation specialists , judgment and other factors in the selection and application of our accounting policies . while we believe that the estimates , assumptions and judgments that we use in preparing our consolidated financial statements are appropriate , these estimates , assumptions and judgments are subject to factors and uncertainties regarding their outcome . therefore , actual results may materially differ from these estimates . some of our significant accounting policies require us to make subjective or complex judgments or estimates . an accounting estimate is considered to be critical if it meets both of the following criteria : ( 1 ) the estimate requires assumptions about matters that are highly uncertain at the time the accounting estimate is made , and ( 2 ) different estimates that reasonably could have been used , or changes in the estimate that are reasonably likely to occur from period to period , would have a material impact on the presentation of our financial condition , results of operations , or cash flows . revenue recognition . we sell the majority of our products via direct shipment to hospitals or clinics . we recognize revenue when all of the following criteria are met : persuasive evidence of an arrangement exists ; delivery has occurred ; the sales price is fixed or determinable ; and collectability is reasonably assured . revenue recognition may occur upon shipment or upon delivery to the customer site , based on the contract terms . we record estimated sales returns , discounts and rebates as a reduction of net sales . costs related to products delivered are recognized in the period the revenue is recognized . story_separator_special_tag research and development expenses decreased by $ 5.0 million , or 16.3 % , from $ 31.0 million for the year ended june 30 , 2015 to $ 25.9 million for the year ended june 30 , 2016. research and development expenses relate to the specific projects to develop new products or expand into new markets , such as the development of new versions of our peripheral oas and coronary oas , and ancillary products , and pad and cad clinical studies . the decrease primarily related to the completion of enrollment in several of our clinical studies . research and development expenses for the years ended june 30 , 2016 and 2015 include $ 1.8 million and $ 1.5 million , respectively , for stock-based compensation . 37 restructuring charges . in march 2016 , we announced a broad-based restructuring to reduce costs as a key part of our plan to balance revenue growth with a pathway to profitability and positive cash flow . as a result , we recorded a restructuring expense of $ 2.4 million during the year ended june 30 , 2016 , which was comprised of severance and other employee related costs . legal settlement . on june 28 , 2016 , we entered into a settlement agreement with the united states of america , acting through the doj and on behalf of the office of inspector general of the department of health and human services , and the relator , to resolve the previously disclosed investigation by the doj and the qui tam complaint filed by the relator pursuant to the false claims act in the u.s. district court for the western district of north carolina , charlotte division . we recorded an $ 8.0 million legal settlement expense during the year ended june 30 , 2016. non-gaap financial information to supplement our consolidated financial statements prepared in accordance with gaap , our management uses a non-gaap financial measure referred to as “ adjusted ebitda . ” the following table sets forth , for the periods indicated , a reconciliation of adjusted ebitda to the most comparable united states gaap measure expressed as dollar amounts ( in thousands ) : replace_table_token_5_th adjusted ebitda improved as compared to the prior year due to the lower loss from operations as a result of higher revenues and lower costs , slightly offset by lower stock based compensation as a result of reduced headcount . use and economic substance of non-gaap financial measures used and usefulness of such non-gaap financial measures to investors we use adjusted ebitda as a supplemental measure of performance and believe this measure facilitates operating performance comparisons from period to period and company to company by factoring out potential differences caused by depreciation and amortization expense and non-cash charges such as stock-based compensation . our management uses adjusted ebitda to analyze the underlying trends in our business , assess the performance of our core operations , establish operational goals and forecasts that are used to allocate resources and evaluate our performance period over period and in relation to our competitors ' operating results . additionally , our management is partially evaluated on the basis of adjusted ebitda when determining achievement of their incentive compensation performance targets . management does not use this adjusted ebitda measure as a liquidity measure or in the calculation of our financial covenants under the revolving credit facility with silicon valley bank . we believe that presenting adjusted ebitda provides investors greater transparency to the information used by our management for its financial and operational decision-making and allows investors to see our results “ through the eyes ” of management . we also believe that providing this information better enables our investors to understand our operating performance and evaluate the methodology used by our management to evaluate and measure such performance . the following is an explanation of each of the items that management excluded from adjusted ebitda and the reasons for excluding each of these individual items : stock-based compensation . our management believes that excluding this item from our non-gaap results is useful to investors to understand the application of stock-based compensation guidance and its impact on our operational performance and ability to make additional investments in the company , and it allows for greater transparency to certain line items in our financial statements . depreciation and amortization expense . our management believes that excluding these items from our non-gaap results is useful to investors to understand our operational performance and ability to make additional investments in the company . 38 material limitations associated with the use of non-gaap financial measures and manner in which we compensate for these limitations non-gaap financial measures have limitations as analytical tools and should not be considered in isolation or as a substitute for our financial results prepared in accordance with gaap . some of the limitations associated with our use of these non-gaap financial measures are : items such as stock-based compensation do not directly affect our cash flow position ; however , such items reflect economic costs to us and are not reflected in our adjusted ebitda , and therefore these non-gaap measures do not reflect the full economic effect of these items . non-gaap financial measures are not based on any comprehensive set of accounting rules or principles and therefore other companies may calculate similarly titled non-gaap financial measures differently than we do , limiting the usefulness of those measures for comparative purposes . our management exercises judgment in determining which types of charges or other items should be excluded from the non-gaap financial measures we use . we compensate for these limitations by relying primarily upon our gaap results and using non-gaap financial measures only supplementally . liquidity and capital resources we had cash and cash equivalents of $ 107.9 million and $ 60.6 million at june 30 , 2017 and 2016 , respectively . during the year ended june 30 , 2017 , net cash provided by

. net cash used in investing activities was $ 1.8 million , $ 3.8 million , and $ 23.0 million for the years ended june 30 , 2017 , 2016 , and 2015 , respectively . cash used in fiscal 2017 was primarily due to the purchase of property and equipment and patents . during fiscal 2016 , cash was used primarily for the purchase of property and equipment and patents , and for the issuance of a convertible note receivable , partially offset by the sale of available-for-sale marketable securities under the deferred compensation plan . during fiscal 2015 , cash was used primarily for the construction of our new headquarters and the related equipment purchases . in addition , we purchased available-for-sale marketable securities for the deferred compensation plans . financing activities . net cash provided by financing activities was $ 29.5 million , $ 4.1 million , and $ 2.6 million during the years ended june 30 , 2017 , 2016 , and 2015 , respectively . cash provided by financing activities during these periods included : proceeds of $ 20.9 million from the sale of the facility in march 2017. employee stock purchase plan purchases of $ 3.3 million , $ 3.1 million , and $ 2.9 million during the years ended june 30 , 2017 , 2016 , and 2015 , respectively . proceeds from the exercise of stock options of $ 5.3 million , $ 1.0 million , and $ 2.2 million during the years ended june 30 , 2017 , 2016 , and 2015 , respectively . cash used in financing activities in these periods included payments on long-term debt of $ 2.4 million during the year ended june 30 , 2015 .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```. net cash used in investing activities was $ 1.8 million , $ 3.8 million , and $ 23.0 million for the years ended june 30 , 2017 , 2016 , and 2015 , respectively . cash used in fiscal 2017 was primarily due to the purchase of property and equipment and patents . during fiscal 2016 , cash was used primarily for the purchase of property and equipment and patents , and for the issuance of a convertible note receivable , partially offset by the sale of available-for-sale marketable securities under the deferred compensation plan . during fiscal 2015 , cash was used primarily for the construction of our new headquarters and the related equipment purchases . in addition , we purchased available-for-sale marketable securities for the deferred compensation plans . financing activities . net cash provided by financing activities was $ 29.5 million , $ 4.1 million , and $ 2.6 million during the years ended june 30 , 2017 , 2016 , and 2015 , respectively . cash provided by financing activities during these periods included : proceeds of $ 20.9 million from the sale of the facility in march 2017. employee stock purchase plan purchases of $ 3.3 million , $ 3.1 million , and $ 2.9 million during the years ended june 30 , 2017 , 2016 , and 2015 , respectively . proceeds from the exercise of stock options of $ 5.3 million , $ 1.0 million , and $ 2.2 million during the years ended june 30 , 2017 , 2016 , and 2015 , respectively . cash used in financing activities in these periods included payments on long-term debt of $ 2.4 million during the year ended june 30 , 2015 . ``` Suspicious Activity Report : international in november 2016 , we signed an exclusive distribution agreement with medikit co. , ltd. ( “ medikit ” ) to sell our diamondback 360 ® coronary and peripheral oas in japan . in march 2017 , we received approval from japan 's ministry of health , labor and welfare for our diamondback 360 ® coronary oas micro crown . pending reimbursement approval , japan will be the first international market for any of our products . we are currently evaluating options for additional international markets to expand the coronary and peripheral opportunities . financial overview net revenues . we derive substantially all of our revenues from the sale of peripheral oas , the coronary oas and ancillary products . the peripheral oas and coronary oas each use a disposable , single-use , low-profile catheter that travels over our proprietary viperwire guide wire . the systems use a saline infusion pump as a power supply for the operation of the catheter . additional ancillary products include the viperslide lubricant and vipertrack radiopaque tape . cost of goods sold . we assemble the single-use catheter with components purchased from third-party suppliers , as well as with components manufactured in-house . the infusion pump and guide wires are purchased from third-party suppliers . our cost of goods sold consists primarily of raw materials , direct labor , and manufacturing overhead . selling , general and administrative expenses . selling , general and administrative expenses include compensation for executive , sales , marketing , finance , information technology , human resources and administrative personnel , including stock-based compensation . other significant expenses include the medical device excise tax , bad debt expense , travel , marketing costs , professional fees and professional education . research and development expenses . research and development expenses include costs associated with the design , development , testing , enhancement and regulatory approval of our products . research and development expenses include employee compensation including stock-based compensation , supplies and materials , patent expenses , consulting expenses , travel and facilities overhead . we also incur significant expenses to operate clinical trials , including trial design , third-party fees , clinical site reimbursement , data management and travel expenses . all research and development expenses are expensed as incurred . approved patent applications are capitalized and amortized using the straight-line method over their remaining estimated lives . patent amortization begins at the time of patent application approval , and does not exceed 20 years . other ( income ) and expense , net . other ( income ) and expense , net primarily includes interest expense from amounts owed under the facility lease and doj settlement , and interest income from money market funds . net operating loss carryforwards . we have established valuation allowances to fully offset our deferred tax assets due to the uncertainty about our ability to generate the future taxable income necessary to realize these deferred assets , particularly in light of our historical losses . the future use of net operating loss carryforwards is dependent on us attaining profitable operations and will be limited in any one year under internal revenue code section 382 due to significant ownership changes ( as defined in section 382 ) resulting from our equity financings . at june 30 , 2017 , we had net operating loss carryforwards for federal and state income tax reporting purposes of approximately $ 239.3 million , which will expire at various dates through fiscal 2036 . 33 critical accounting policies and significant judgments and estimates our management 's discussion and analysis of our financial condition and results of operations are based on our consolidated financial statements , which have been prepared in accordance with accounting principles generally accepted in the united states . the preparation of our consolidated financial statements requires us to make estimates , assumptions and judgments that affect amounts reported in those statements . our estimates , assumptions and judgments , including those related to revenue recognition , allowance for doubtful accounts , excess and obsolete inventory , and stock-based compensation are updated as appropriate at least quarterly . we use authoritative pronouncements , our technical accounting knowledge , cumulative business experience , valuation specialists , judgment and other factors in the selection and application of our accounting policies . while we believe that the estimates , assumptions and judgments that we use in preparing our consolidated financial statements are appropriate , these estimates , assumptions and judgments are subject to factors and uncertainties regarding their outcome . therefore , actual results may materially differ from these estimates . some of our significant accounting policies require us to make subjective or complex judgments or estimates . an accounting estimate is considered to be critical if it meets both of the following criteria : ( 1 ) the estimate requires assumptions about matters that are highly uncertain at the time the accounting estimate is made , and ( 2 ) different estimates that reasonably could have been used , or changes in the estimate that are reasonably likely to occur from period to period , would have a material impact on the presentation of our financial condition , results of operations , or cash flows . revenue recognition . we sell the majority of our products via direct shipment to hospitals or clinics . we recognize revenue when all of the following criteria are met : persuasive evidence of an arrangement exists ; delivery has occurred ; the sales price is fixed or determinable ; and collectability is reasonably assured . revenue recognition may occur upon shipment or upon delivery to the customer site , based on the contract terms . we record estimated sales returns , discounts and rebates as a reduction of net sales . costs related to products delivered are recognized in the period the revenue is recognized . story_separator_special_tag research and development expenses decreased by $ 5.0 million , or 16.3 % , from $ 31.0 million for the year ended june 30 , 2015 to $ 25.9 million for the year ended june 30 , 2016. research and development expenses relate to the specific projects to develop new products or expand into new markets , such as the development of new versions of our peripheral oas and coronary oas , and ancillary products , and pad and cad clinical studies . the decrease primarily related to the completion of enrollment in several of our clinical studies . research and development expenses for the years ended june 30 , 2016 and 2015 include $ 1.8 million and $ 1.5 million , respectively , for stock-based compensation . 37 restructuring charges . in march 2016 , we announced a broad-based restructuring to reduce costs as a key part of our plan to balance revenue growth with a pathway to profitability and positive cash flow . as a result , we recorded a restructuring expense of $ 2.4 million during the year ended june 30 , 2016 , which was comprised of severance and other employee related costs . legal settlement . on june 28 , 2016 , we entered into a settlement agreement with the united states of america , acting through the doj and on behalf of the office of inspector general of the department of health and human services , and the relator , to resolve the previously disclosed investigation by the doj and the qui tam complaint filed by the relator pursuant to the false claims act in the u.s. district court for the western district of north carolina , charlotte division . we recorded an $ 8.0 million legal settlement expense during the year ended june 30 , 2016. non-gaap financial information to supplement our consolidated financial statements prepared in accordance with gaap , our management uses a non-gaap financial measure referred to as “ adjusted ebitda . ” the following table sets forth , for the periods indicated , a reconciliation of adjusted ebitda to the most comparable united states gaap measure expressed as dollar amounts ( in thousands ) : replace_table_token_5_th adjusted ebitda improved as compared to the prior year due to the lower loss from operations as a result of higher revenues and lower costs , slightly offset by lower stock based compensation as a result of reduced headcount . use and economic substance of non-gaap financial measures used and usefulness of such non-gaap financial measures to investors we use adjusted ebitda as a supplemental measure of performance and believe this measure facilitates operating performance comparisons from period to period and company to company by factoring out potential differences caused by depreciation and amortization expense and non-cash charges such as stock-based compensation . our management uses adjusted ebitda to analyze the underlying trends in our business , assess the performance of our core operations , establish operational goals and forecasts that are used to allocate resources and evaluate our performance period over period and in relation to our competitors ' operating results . additionally , our management is partially evaluated on the basis of adjusted ebitda when determining achievement of their incentive compensation performance targets . management does not use this adjusted ebitda measure as a liquidity measure or in the calculation of our financial covenants under the revolving credit facility with silicon valley bank . we believe that presenting adjusted ebitda provides investors greater transparency to the information used by our management for its financial and operational decision-making and allows investors to see our results “ through the eyes ” of management . we also believe that providing this information better enables our investors to understand our operating performance and evaluate the methodology used by our management to evaluate and measure such performance . the following is an explanation of each of the items that management excluded from adjusted ebitda and the reasons for excluding each of these individual items : stock-based compensation . our management believes that excluding this item from our non-gaap results is useful to investors to understand the application of stock-based compensation guidance and its impact on our operational performance and ability to make additional investments in the company , and it allows for greater transparency to certain line items in our financial statements . depreciation and amortization expense . our management believes that excluding these items from our non-gaap results is useful to investors to understand our operational performance and ability to make additional investments in the company . 38 material limitations associated with the use of non-gaap financial measures and manner in which we compensate for these limitations non-gaap financial measures have limitations as analytical tools and should not be considered in isolation or as a substitute for our financial results prepared in accordance with gaap . some of the limitations associated with our use of these non-gaap financial measures are : items such as stock-based compensation do not directly affect our cash flow position ; however , such items reflect economic costs to us and are not reflected in our adjusted ebitda , and therefore these non-gaap measures do not reflect the full economic effect of these items . non-gaap financial measures are not based on any comprehensive set of accounting rules or principles and therefore other companies may calculate similarly titled non-gaap financial measures differently than we do , limiting the usefulness of those measures for comparative purposes . our management exercises judgment in determining which types of charges or other items should be excluded from the non-gaap financial measures we use . we compensate for these limitations by relying primarily upon our gaap results and using non-gaap financial measures only supplementally . liquidity and capital resources we had cash and cash equivalents of $ 107.9 million and $ 60.6 million at june 30 , 2017 and 2016 , respectively . during the year ended june 30 , 2017 , net cash provided by

our core strategy is to create organic growth by investing in research and development ( `` r & d `` ) to create solutions and tech-enabled services for the health care industry . we may also supplement organic growth with acquisitions or strategic investments . cerner 's long history of growth has created an important strategic footprint in health care , with cerner holding more than 25 percent market share in the u.s. acute care ehr market and a leading market share in several non-u.s. regions . foundational to our growth going forward is delivering value to this core client base , including executing effectively on our large u.s. federal contracts and cross-selling key solutions and services in areas such as revenue cycle . we are also investing in platform modernization , with a focus on delivering a software as a service platform that we expect to lower total cost of ownership , improve clinician experience and patient outcomes , and enable clients to accelerate adoption of new functionality and better leverage third-party innovations . we also expect to continue driving growth by leveraging our healtheintent platform , which is the foundation for established and new offerings for both provider and non-provider markets . the ehr-agnostic healtheintent platform enables cerner to become a strategic partner with health care stakeholders and help them improve performance under value-based contracting . the platform , along with our careaware platform , also supports offerings in areas such long-term care , home care and hospice , rehabilitation , behavioral health , community care , care team communications , health systems operations , consumer and employer , and data-as-a-service . beyond our strategy for driving revenue growth , we are also focused on earnings growth . after several years of margin compression related to slowing revenue growth , increased mix of low-margin services , and lower software demand due to the end of direct government incentives for ehr adoptions , cerner implemented a new operating structure and introduced other initiatives focused on cost optimization and process improvement in 2019. to assist in these efforts , we engaged an outside consulting firm to conduct a review of our operations and cost structure . we made good progress in 2019 and expect this progress to be reflected in improved profitability in 2020 and beyond . we are focused on ongoing identification of opportunities to operate more efficiently and on achieving the efficiencies without impacting the quality of our solutions and services and commitments to our clients . we are also focused on delivering strong levels of cash flow which we expect to accomplish by continuing to grow earnings and prudently managing capital expenditures . we expect to use future cash flow and debt , as appropriate , to meet our capital allocation objectives , which include investing in our business , potential acquisitions or other strategic investments to drive profitable growth , and returning capital to shareholders through share repurchases and dividends . results overview bookings , which reflects the value of executed contracts for software , hardware , professional services and managed services , was $ 5.99 billion in 2019 , which is a decrease of 11 % compared to $ 6.72 billion in 2018 , with the decrease primarily reflecting a more selective approach to low-margin , long-term contracts that typically represent large booking values . 26 revenues for 2019 increased 6 % to $ 5.69 billion , compared to $ 5.37 billion in 2018 . the increase in revenue reflects ongoing demand from new and existing clients for cerner 's solutions and tech-enabled services driven by their needs to keep up with regulatory requirements , adapt to changing reimbursement models , and deliver safer and more efficient care . net earnings for 2019 decreased 16 % to $ 529 million , compared to $ 630 million in 2018 . diluted earnings per share decreased 13 % to $ 1.65 in 2019 , compared to $ 1.89 in 2018 . the overall decrease in net earnings and diluted earnings per share was primarily a result of increased operating expenses , including expenses incurred in connection with our operational improvement initiatives discussed below , partially offset by increased revenues . we had cash collections of receivables of $ 5.79 billion in 2019 , compared to $ 5.49 billion in 2018 . days sales outstanding was 72 days for the 2019 fourth quarter , compared to 74 days for the 2019 third quarter and 79 days for the 2018 fourth quarter . operating cash flows for 2019 were $ 1.31 billion , compared to $ 1.45 billion in 2018 . operational improvement initiatives we transitioned to a new operating structure in the first quarter of 2019. the company has been focused on leveraging the impact of this reorganization and identifying additional efficiencies . currently , we are focused on reducing operating expenses and generating other efficiencies that are expected to provide longer-term operating margin expansion . we are also considering exiting certain low-margin businesses and being more selective as we consider new business opportunities . to assist in these efforts , we have engaged an outside consulting firm to conduct a review of our operations and cost structure . we are focused on ongoing identification of opportunities to operate more efficiently and on achieving the efficiencies without impacting the quality of our solutions and services and commitments to our clients . in the near term , we expect to incur expenses in connection with these efforts . such expenses may include , but are not limited to , consultant and other professional services fees , employee separation costs , contract termination costs , and other such related expenses . story_separator_special_tag we define free cash flow as cash flows from operating activities reduced by capital purchases and capitalized software development costs . the table above sets forth a reconciliation of free cash flow to cash flows from operating activities , which we believe is the gaap financial measure most directly comparable to free cash flow . the presentation of free cash flow is not meant to be considered in isolation , nor as a substitute for , or superior to , gaap results , and investors should be aware that non-gaap measures have inherent limitations and should be read only in conjunction with our consolidated financial statements prepared in accordance with gaap . free cash flow may also be different from similar non-gaap financial measures used by other companies and may not be comparable to similarly titled captions of other companies due to potential inconsistencies in the method of calculation . we believe free cash flow is important to enable investors to better understand and evaluate our ongoing operating results and allows for greater transparency in the review and understanding of our overall financial , operational and economic performance , because free cash flow takes into account certain capital expenditures necessary to operate our business . 34 contractual obligations , commitments and off balance sheet arrangements the following table represents a summary of our contractual obligations and commercial commitments at the end of 2019 , except short-term purchase order commitments arising in the ordinary course of business . replace_table_token_11_th ( a ) at the end of 2019 , liabilities for unrecognized tax benefits were $ 19 million . off-balance sheet arrangements refer to note ( 10 ) of the notes to consolidated financial statements for information regarding our interest rate swap agreement , which is accounted for as a cash flow hedge in accordance with asc topic 815 , derivatives and hedging . libor is scheduled to be phased out by the end of 2021. when libor ceases to exist , we will need to agree upon a replacement index with the lenders under our credit agreement at the time , and such new rates may not be as favorable to us as those in effect prior to any libor phase-out . if the swap and the credit agreement replacement rates are not identical , our hedge could be less effective . recent accounting pronouncements refer to note ( 1 ) of the notes to consolidated financial statements for information regarding recently issued accounting pronouncements . critical accounting policies we believe that there are several accounting policies that are critical to understanding our historical and future performance , as these policies affect the reported amount of revenue and other significant areas involving our judgments and estimates . these significant accounting policies relate to revenue recognition , software development , and income taxes . these accounting policies and our procedures related to these accounting policies are described in detail below and under specific areas within this md & a . in addition , note ( 1 ) , note ( 2 ) , and note ( 14 ) of the notes to consolidated financial statements expands upon discussion of our accounting policies for these areas . revenue recognition in the first quarter of 2018 , we adopted accounting standards update ( `` asu `` ) 2014-09 , revenue from contracts with customers ( topic 606 ) . asu 2014-09 , as amended , replaced most existing revenue recognition guidance in u.s. gaap . this guidance requires a significant amount of judgments and estimates in implementing its five-step process to be followed in determining the amount and timing of revenue recognition and related disclosures . refer to note ( 2 ) of the notes to consolidated financial statements for further discussion regarding significant judgments involved in our application of asu 2014-09. software development costs costs incurred internally in creating computer software solutions and enhancements to those solutions are expensed until completion of a detailed program design , which is when we determine that technological feasibility has been established . thereafter , all software development costs are capitalized until such time as the software solutions and enhancements are available for general release , and the capitalized costs subsequently are reported at the lower of amortized cost or net realizable value . 35 net realizable value is computed as the estimated gross future revenues from each software solution less the amount of estimated future costs of completing and disposing of that product . because the development of projected net future revenues related to our software solutions used in our net realizable value computation is based on estimates , a significant reduction in our future revenues could impact the recovery of our capitalized software development costs . if we missed our estimates of net future revenues by 10 % , the amount of our capitalized software development costs would not be impaired . capitalized costs are amortized based on current and expected net future revenue for each software solution with minimum annual amortization equal to the straight-line amortization over the estimated economic life of the software solution . we are amortizing capitalized costs over five years . the five-year period over which capitalized software development costs are amortized is an estimate based upon our forecast of a reasonable useful life for the capitalized costs . historically , use of our software programs by our clients has exceeded five years and is capable of being used a decade or more . we expect that major software information systems companies , large information technology consulting service providers and systems integrators and others specializing in the health care industry may offer competitive products or services . the pace of change in the hcit market is rapid and there are frequent new product introductions , product enhancements and evolving industry standards and requirements . as a result , the capitalized software solutions may become less valuable or obsolete and could be subject to impairment . income taxes we make a

liquidity and capital resources our liquidity is influenced by many factors , including the amount and timing of our revenues , our cash collections from our clients and the amount we invest in software development , acquisitions , capital expenditures , and our share repurchase and dividend programs . our principal sources of liquidity are our cash , cash equivalents , which primarily consist of money market funds and time deposits with original maturities of less than 90 days , short-term investments , and borrowings under our credit agreement . at the end of 2019 , we had cash and cash equivalents of $ 442 million and short-term investments of $ 100 million , as compared to cash and cash equivalents of $ 374 million and short-term investments of $ 401 million at the end of 2018 . we have entered into a credit agreement with a syndicate of lenders that provides for an unsecured $ 1.00 billion revolving credit loan facility , along with a letter of credit facility up to $ 100 million ( which is a sub-facility of the $ 1.00 billion revolving credit loan facility ) . we have the ability to increase the maximum capacity to $ 1.20 billion at any time during the credit agreement 's term , subject to lender participation and the satisfaction of specified conditions.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```liquidity and capital resources our liquidity is influenced by many factors , including the amount and timing of our revenues , our cash collections from our clients and the amount we invest in software development , acquisitions , capital expenditures , and our share repurchase and dividend programs . our principal sources of liquidity are our cash , cash equivalents , which primarily consist of money market funds and time deposits with original maturities of less than 90 days , short-term investments , and borrowings under our credit agreement . at the end of 2019 , we had cash and cash equivalents of $ 442 million and short-term investments of $ 100 million , as compared to cash and cash equivalents of $ 374 million and short-term investments of $ 401 million at the end of 2018 . we have entered into a credit agreement with a syndicate of lenders that provides for an unsecured $ 1.00 billion revolving credit loan facility , along with a letter of credit facility up to $ 100 million ( which is a sub-facility of the $ 1.00 billion revolving credit loan facility ) . we have the ability to increase the maximum capacity to $ 1.20 billion at any time during the credit agreement 's term , subject to lender participation and the satisfaction of specified conditions. ``` Suspicious Activity Report : our core strategy is to create organic growth by investing in research and development ( `` r & d `` ) to create solutions and tech-enabled services for the health care industry . we may also supplement organic growth with acquisitions or strategic investments . cerner 's long history of growth has created an important strategic footprint in health care , with cerner holding more than 25 percent market share in the u.s. acute care ehr market and a leading market share in several non-u.s. regions . foundational to our growth going forward is delivering value to this core client base , including executing effectively on our large u.s. federal contracts and cross-selling key solutions and services in areas such as revenue cycle . we are also investing in platform modernization , with a focus on delivering a software as a service platform that we expect to lower total cost of ownership , improve clinician experience and patient outcomes , and enable clients to accelerate adoption of new functionality and better leverage third-party innovations . we also expect to continue driving growth by leveraging our healtheintent platform , which is the foundation for established and new offerings for both provider and non-provider markets . the ehr-agnostic healtheintent platform enables cerner to become a strategic partner with health care stakeholders and help them improve performance under value-based contracting . the platform , along with our careaware platform , also supports offerings in areas such long-term care , home care and hospice , rehabilitation , behavioral health , community care , care team communications , health systems operations , consumer and employer , and data-as-a-service . beyond our strategy for driving revenue growth , we are also focused on earnings growth . after several years of margin compression related to slowing revenue growth , increased mix of low-margin services , and lower software demand due to the end of direct government incentives for ehr adoptions , cerner implemented a new operating structure and introduced other initiatives focused on cost optimization and process improvement in 2019. to assist in these efforts , we engaged an outside consulting firm to conduct a review of our operations and cost structure . we made good progress in 2019 and expect this progress to be reflected in improved profitability in 2020 and beyond . we are focused on ongoing identification of opportunities to operate more efficiently and on achieving the efficiencies without impacting the quality of our solutions and services and commitments to our clients . we are also focused on delivering strong levels of cash flow which we expect to accomplish by continuing to grow earnings and prudently managing capital expenditures . we expect to use future cash flow and debt , as appropriate , to meet our capital allocation objectives , which include investing in our business , potential acquisitions or other strategic investments to drive profitable growth , and returning capital to shareholders through share repurchases and dividends . results overview bookings , which reflects the value of executed contracts for software , hardware , professional services and managed services , was $ 5.99 billion in 2019 , which is a decrease of 11 % compared to $ 6.72 billion in 2018 , with the decrease primarily reflecting a more selective approach to low-margin , long-term contracts that typically represent large booking values . 26 revenues for 2019 increased 6 % to $ 5.69 billion , compared to $ 5.37 billion in 2018 . the increase in revenue reflects ongoing demand from new and existing clients for cerner 's solutions and tech-enabled services driven by their needs to keep up with regulatory requirements , adapt to changing reimbursement models , and deliver safer and more efficient care . net earnings for 2019 decreased 16 % to $ 529 million , compared to $ 630 million in 2018 . diluted earnings per share decreased 13 % to $ 1.65 in 2019 , compared to $ 1.89 in 2018 . the overall decrease in net earnings and diluted earnings per share was primarily a result of increased operating expenses , including expenses incurred in connection with our operational improvement initiatives discussed below , partially offset by increased revenues . we had cash collections of receivables of $ 5.79 billion in 2019 , compared to $ 5.49 billion in 2018 . days sales outstanding was 72 days for the 2019 fourth quarter , compared to 74 days for the 2019 third quarter and 79 days for the 2018 fourth quarter . operating cash flows for 2019 were $ 1.31 billion , compared to $ 1.45 billion in 2018 . operational improvement initiatives we transitioned to a new operating structure in the first quarter of 2019. the company has been focused on leveraging the impact of this reorganization and identifying additional efficiencies . currently , we are focused on reducing operating expenses and generating other efficiencies that are expected to provide longer-term operating margin expansion . we are also considering exiting certain low-margin businesses and being more selective as we consider new business opportunities . to assist in these efforts , we have engaged an outside consulting firm to conduct a review of our operations and cost structure . we are focused on ongoing identification of opportunities to operate more efficiently and on achieving the efficiencies without impacting the quality of our solutions and services and commitments to our clients . in the near term , we expect to incur expenses in connection with these efforts . such expenses may include , but are not limited to , consultant and other professional services fees , employee separation costs , contract termination costs , and other such related expenses . story_separator_special_tag we define free cash flow as cash flows from operating activities reduced by capital purchases and capitalized software development costs . the table above sets forth a reconciliation of free cash flow to cash flows from operating activities , which we believe is the gaap financial measure most directly comparable to free cash flow . the presentation of free cash flow is not meant to be considered in isolation , nor as a substitute for , or superior to , gaap results , and investors should be aware that non-gaap measures have inherent limitations and should be read only in conjunction with our consolidated financial statements prepared in accordance with gaap . free cash flow may also be different from similar non-gaap financial measures used by other companies and may not be comparable to similarly titled captions of other companies due to potential inconsistencies in the method of calculation . we believe free cash flow is important to enable investors to better understand and evaluate our ongoing operating results and allows for greater transparency in the review and understanding of our overall financial , operational and economic performance , because free cash flow takes into account certain capital expenditures necessary to operate our business . 34 contractual obligations , commitments and off balance sheet arrangements the following table represents a summary of our contractual obligations and commercial commitments at the end of 2019 , except short-term purchase order commitments arising in the ordinary course of business . replace_table_token_11_th ( a ) at the end of 2019 , liabilities for unrecognized tax benefits were $ 19 million . off-balance sheet arrangements refer to note ( 10 ) of the notes to consolidated financial statements for information regarding our interest rate swap agreement , which is accounted for as a cash flow hedge in accordance with asc topic 815 , derivatives and hedging . libor is scheduled to be phased out by the end of 2021. when libor ceases to exist , we will need to agree upon a replacement index with the lenders under our credit agreement at the time , and such new rates may not be as favorable to us as those in effect prior to any libor phase-out . if the swap and the credit agreement replacement rates are not identical , our hedge could be less effective . recent accounting pronouncements refer to note ( 1 ) of the notes to consolidated financial statements for information regarding recently issued accounting pronouncements . critical accounting policies we believe that there are several accounting policies that are critical to understanding our historical and future performance , as these policies affect the reported amount of revenue and other significant areas involving our judgments and estimates . these significant accounting policies relate to revenue recognition , software development , and income taxes . these accounting policies and our procedures related to these accounting policies are described in detail below and under specific areas within this md & a . in addition , note ( 1 ) , note ( 2 ) , and note ( 14 ) of the notes to consolidated financial statements expands upon discussion of our accounting policies for these areas . revenue recognition in the first quarter of 2018 , we adopted accounting standards update ( `` asu `` ) 2014-09 , revenue from contracts with customers ( topic 606 ) . asu 2014-09 , as amended , replaced most existing revenue recognition guidance in u.s. gaap . this guidance requires a significant amount of judgments and estimates in implementing its five-step process to be followed in determining the amount and timing of revenue recognition and related disclosures . refer to note ( 2 ) of the notes to consolidated financial statements for further discussion regarding significant judgments involved in our application of asu 2014-09. software development costs costs incurred internally in creating computer software solutions and enhancements to those solutions are expensed until completion of a detailed program design , which is when we determine that technological feasibility has been established . thereafter , all software development costs are capitalized until such time as the software solutions and enhancements are available for general release , and the capitalized costs subsequently are reported at the lower of amortized cost or net realizable value . 35 net realizable value is computed as the estimated gross future revenues from each software solution less the amount of estimated future costs of completing and disposing of that product . because the development of projected net future revenues related to our software solutions used in our net realizable value computation is based on estimates , a significant reduction in our future revenues could impact the recovery of our capitalized software development costs . if we missed our estimates of net future revenues by 10 % , the amount of our capitalized software development costs would not be impaired . capitalized costs are amortized based on current and expected net future revenue for each software solution with minimum annual amortization equal to the straight-line amortization over the estimated economic life of the software solution . we are amortizing capitalized costs over five years . the five-year period over which capitalized software development costs are amortized is an estimate based upon our forecast of a reasonable useful life for the capitalized costs . historically , use of our software programs by our clients has exceeded five years and is capable of being used a decade or more . we expect that major software information systems companies , large information technology consulting service providers and systems integrators and others specializing in the health care industry may offer competitive products or services . the pace of change in the hcit market is rapid and there are frequent new product introductions , product enhancements and evolving industry standards and requirements . as a result , the capitalized software solutions may become less valuable or obsolete and could be subject to impairment . income taxes we make a

40 md & a duke energy 2018 areas of focus and accomplishments operational excellence and reliability . the safety of our workforce is a core value . our employees delivered strong safety results in 2018 , and we maintained our industry-leading performance levels from 2016 and 2017. the reliable and safe operation of our power plants , electric distribution system and natural gas infrastructure is foundational to our customers , our financial results and our credibility with stakeholders . our nuclear and fossil/hydro generation fleets demonstrated strong performance , exceeding their respective reliability targets . five of our six nuclear sites have achieved inpo 1 status , the industry 's highest distinction . our electric distribution system performed well throughout the year , though we see opportunities to reduce outage durations . storm response and system restoration . 2018 was a year of intense storm activity , with hurricane florence and hurricane michael delivering a significant impact to our jurisdictions . employees and utility partners worked tirelessly to restore 3 million outages during the hurricane season . our team restored 93 percent of outages within five days during hurricane florence and 90 percent of outages within three days during hurricane michael . our ability to effectively handle all facets of the 2018 storm response efforts is a testament to our team 's extensive preparation and coordination in advance of the storm , applying lessons learned from previous storms , and on-the-ground management throughout the restoration efforts . customer satisfaction . duke energy continues to transform the customer experience through our use of customer data to better inform operational priorities and performance levels . this data-driven approach allows us to identify the investments that are the most important to the customer experience . in 2018 , we instituted more proactive communications , such as text alerts during outages , in response to customer expectations . over time our work with data analytics will result in customer satisfaction improvement as measured through j.d . power and other surveys . constructive regulatory and legislative outcomes . one of our long-term strategic goals is to achieve modernized regulatory constructs in our jurisdictions . modernized constructs provide benefits , which include improved earnings and cash flows through more timely recovery of investments , as well as stable pricing for customers . we achieved constructive regulatory outcomes in 2018 in north carolina for both duke energy carolinas and duke energy progress , including the recovery of coal ash basin closure costs . the ohio comprehensive settlement agreement in 2018 , approved by puco , was a favorable outcome that will enable the creation of a new powerforward rider to recover costs associated with projects to modernize the grid and transform the customer experience . we are making progress in addressing tax reform across our jurisdictions , targeting solutions that provide benefits to customers and support the long-term credit quality of our utilities . cost management and efficiencies . duke energy has a demonstrated track record of driving efficiencies and productivity into the business , including merger integration and continuous improvement efforts . we continue to leverage new technology and data analytics to drive additional efficiencies across the business in response to a transforming landscape . in 2018 , we established a digital transformation initiative that is tasked with identifying the best ways to use digital capabilities throughout our business . modernizing the power grid . our grid improvement programs continue to be a key component of our growth strategy . modernization of the electric grid , including smart meters , storm hardening , self-healing and targeted undergrounding helps to ensure the system is better prepared for severe weather , improves the system 's reliability and flexibility , and provides better information and services for customers . grid improvements enable successful storm response ; for example , in the carolinas , self-healing grid technologies rerouted power from damaged lines and systems to minimize outages . in 2018 , we deployed 1.6 million smart meters resulting in 4.3 million customers having access to this technology across our regulated footprint . generating cleaner energy . we advanced efforts to generate cleaner energy , including progress on several strategic investments during 2018. overall , we have lowered our carbon emissions by over 30 percent since 2005 , consistent with our goal to reduce carbon emissions by 40 percent by 2030. two natural gas plants came online in 2018 and construction continues on a third one . in our commercial renewable business , our shoreham solar facility came online in 2018. expanding the natural gas platform . we continue to pursue natural gas infrastructure investments . we are working diligently to construct the acp pipeline to bring low-cost gas supply and economic development opportunities to the mid-atlantic . while we navigate the impacts of permitting delays and court rulings , we remain steadfast in our commitment to this backbone infrastructure for the southeast u.s. in 2018 , piedmont announced plans to construct a new liquefied natural gas facility in robeson county north carolina on property piedmont already owns . this investment will help piedmont provide a reliable gas supply to customers during peak usage periods . we expect to begin construction in the summer of 2019. dividend growth . in 2018 , duke energy continued to grow the dividend payment to shareholders by approximately 4 percent . 2018 represented the 92nd consecutive year duke energy paid a cash dividend on its common stock . 41 md & a duke energy duke energy objectives – 2019 and beyond duke energy will continue to deliver exceptional value to customers , be an integral part of the communities in which we do business , and provide attractive returns to investors . we have an achievable , long-term strategy in place and it is producing tangible results , yet the industry in which we operate is becoming more and more dynamic . story_separator_special_tag the variance was primarily due to the lower statutory federal corporate tax rate under the tax act , a decrease in pretax income and the impact of the tax act in the prior year . the etrs for the years ended december 31 , 2018 , and 2017 were 20.7 percent and 29.7 percent , respectively . the decrease in the etr was primarily due to the lower statutory federal corporate tax rate under the tax act and the amortization of excess deferred taxes partially offset by the impact of the tax act in the prior year . see the tax act section above for additional information . year ended december 31 , 2017 , as compared to 2016 electric utilities and infrastructure 's results were impacted by the tax act , growth from investments , lower operations and maintenance expense and higher weather-normal retail sales volumes , partially offset by less favorable weather , impairment charges due to regulatory settlements , increased depreciation and amortization , higher interest expense and higher property and other taxes . the following is a detailed discussion of the variance drivers by line item . operating revenues . the variance was driven primarily by : a $ 292 million decrease in retail sales , net of fuel revenue , due to less favorable weather in the current year ; and a $ 235 million decrease in fuel revenues driven by lower retail sales volumes , lower fuel prices included in rates and changes in the generation mix . partially offset by : a $ 364 million increase in rider revenues including increased revenues related to energy efficiency programs , duke energy florida 's nuclear asset securitization , midwest transmission and distribution capital investments and duke energy indiana 's edwardsport igcc plant , as well as an increase in retail pricing due to base rate adjustments for duke energy florida 's osprey acquisition and hines chillers and the duke energy progress south carolina rate case ; an $ 86 million increase in weather-normal sales volumes to customers ; and a $ 26 million increase in other revenues primarily due to favorable transmission revenues . operating expenses . the variance was driven primarily by : a $ 160 million increase in impairment charges primarily due to the write-off of remaining unrecovered levy nuclear project costs in the current year at duke energy florida and the disallowance from rate base of certain projects at the mayo and sutton plants in the current year at duke energy progress related to the partial settlement in the north carolina rate case ; a $ 113 million increase in depreciation and amortization expense primarily due to additional plant in service ; and a $ 58 million increase in property and other taxes primarily due to higher property taxes . 46 md & a segment results - electric utilities and infrastructure partially offset by : a $ 216 million decrease in fuel expense ( including purchased power ) primarily due to lower retail sales and changes in the generation mix ; and a $ 73 million decrease in operation , maintenance and other expense primarily due to lower plant outage , storm restoration and labor and benefits costs partially offset by higher operational costs that are recoverable in rates . interest expense . the variance was due to higher debt outstanding in the current year and duke energy florida 's crystal river unit 3 regulatory asset debt return ending in june 2016 upon securitization . income tax expense . the variance was primarily due to a decrease in pretax income and the impact of the tax act . the effective tax rates for the years ended december 31 , 2017 , and 2016 were 29.7 percent and 35.5 percent , respectively . the decrease in the effective tax rate was primarily due to the impact of the tax act . see the tax act section above for additional information . matters impacting future electric utilities and infrastructure results on may 18 , 2016 , the ncdeq issued proposed risk classifications for all coal ash surface impoundments in north carolina . all ash impoundments not previously designated as high priority by the coal ash act were designated as intermediate risk . certain impoundments classified as intermediate risk , however , were eligible for reassessment as low risk pursuant to legislation enacted on july 14 , 2016. on november 14 , 2018 , ncdeq issued final low-risk classifications for these impoundments , indicating that duke energy carolinas and duke energy progress have satisfied the permanent replacement water supply and certain dam improvement requirements set out in the coal ash management act . as the final closure plans and corrective action measures are developed and approved for each site , the closure work progresses and the closure method scope and remedial action methods are determined , the complexity of work and the amount of coal combustion material could be different than originally estimated and , therefore , could materially impact electric utilities and infrastructure 's results of operations , financial position and cash flows . see note 9 to the consolidated financial statements , `` asset retirement obligations , `` for additional information . duke energy is a party to multiple lawsuits and could be subject to fines and other penalties related to operations at certain north carolina facilities with ash basins . in addition , the orders issued in the duke energy carolinas and duke energy progress north carolinas rate cases supporting recovery of past coal ash remediation costs have been appealed by various parties . the outcome of these appeals , lawsuits and potential fines and penalties could have an adverse impact on electric utilities and infrastructure 's results of operations , financial position , and cash flows . see notes 4 and 5 to the consolidated financial statements , `` regulatory matters `` and “ commitments and contingencies , ” respectively , for additional information . on june 22 , 2018 ,

senior unsecured debt baa1 a- n/a piedmont natural gas stable stable n/a senior unsecured a3 a- n/a credit ratings are intended to provide credit lenders a framework for comparing the credit quality of securities and are not a recommendation to buy , sell or hold . the duke energy registrants ' credit ratings are dependent on the rating agencies ' assessments of their ability to meet their debt principal and interest obligations when they come due . if , as a result of market conditions or other factors , the duke energy registrants are unable to maintain current balance sheet strength , or if earnings and cash flow outlook materially deteriorates , credit ratings could be negatively impacted . cash flow information the following table summarizes duke energy 's cash flows for the three most recently completed fiscal years . replace_table_token_36_th 73 md & a liquidity and capital resources operating cash flows the following table summarizes key components of duke energy 's operating cash flows for the three most recently completed fiscal years . replace_table_token_37_th for the year ended december 31 , 2018 , compared to 2017 , the variance was driven primarily by : a $ 684 million increase in net income after adjustment for non-cash items primarily due to favorable weather and increased pricing and volumes in the current period ; and a $ 38 million decrease in payments to aros . offset by : a $ 122 million increase in contributions to qualified pension plans ; and a $ 105 million payment for disposal of beckjord .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```senior unsecured debt baa1 a- n/a piedmont natural gas stable stable n/a senior unsecured a3 a- n/a credit ratings are intended to provide credit lenders a framework for comparing the credit quality of securities and are not a recommendation to buy , sell or hold . the duke energy registrants ' credit ratings are dependent on the rating agencies ' assessments of their ability to meet their debt principal and interest obligations when they come due . if , as a result of market conditions or other factors , the duke energy registrants are unable to maintain current balance sheet strength , or if earnings and cash flow outlook materially deteriorates , credit ratings could be negatively impacted . cash flow information the following table summarizes duke energy 's cash flows for the three most recently completed fiscal years . replace_table_token_36_th 73 md & a liquidity and capital resources operating cash flows the following table summarizes key components of duke energy 's operating cash flows for the three most recently completed fiscal years . replace_table_token_37_th for the year ended december 31 , 2018 , compared to 2017 , the variance was driven primarily by : a $ 684 million increase in net income after adjustment for non-cash items primarily due to favorable weather and increased pricing and volumes in the current period ; and a $ 38 million decrease in payments to aros . offset by : a $ 122 million increase in contributions to qualified pension plans ; and a $ 105 million payment for disposal of beckjord . ``` Suspicious Activity Report : 40 md & a duke energy 2018 areas of focus and accomplishments operational excellence and reliability . the safety of our workforce is a core value . our employees delivered strong safety results in 2018 , and we maintained our industry-leading performance levels from 2016 and 2017. the reliable and safe operation of our power plants , electric distribution system and natural gas infrastructure is foundational to our customers , our financial results and our credibility with stakeholders . our nuclear and fossil/hydro generation fleets demonstrated strong performance , exceeding their respective reliability targets . five of our six nuclear sites have achieved inpo 1 status , the industry 's highest distinction . our electric distribution system performed well throughout the year , though we see opportunities to reduce outage durations . storm response and system restoration . 2018 was a year of intense storm activity , with hurricane florence and hurricane michael delivering a significant impact to our jurisdictions . employees and utility partners worked tirelessly to restore 3 million outages during the hurricane season . our team restored 93 percent of outages within five days during hurricane florence and 90 percent of outages within three days during hurricane michael . our ability to effectively handle all facets of the 2018 storm response efforts is a testament to our team 's extensive preparation and coordination in advance of the storm , applying lessons learned from previous storms , and on-the-ground management throughout the restoration efforts . customer satisfaction . duke energy continues to transform the customer experience through our use of customer data to better inform operational priorities and performance levels . this data-driven approach allows us to identify the investments that are the most important to the customer experience . in 2018 , we instituted more proactive communications , such as text alerts during outages , in response to customer expectations . over time our work with data analytics will result in customer satisfaction improvement as measured through j.d . power and other surveys . constructive regulatory and legislative outcomes . one of our long-term strategic goals is to achieve modernized regulatory constructs in our jurisdictions . modernized constructs provide benefits , which include improved earnings and cash flows through more timely recovery of investments , as well as stable pricing for customers . we achieved constructive regulatory outcomes in 2018 in north carolina for both duke energy carolinas and duke energy progress , including the recovery of coal ash basin closure costs . the ohio comprehensive settlement agreement in 2018 , approved by puco , was a favorable outcome that will enable the creation of a new powerforward rider to recover costs associated with projects to modernize the grid and transform the customer experience . we are making progress in addressing tax reform across our jurisdictions , targeting solutions that provide benefits to customers and support the long-term credit quality of our utilities . cost management and efficiencies . duke energy has a demonstrated track record of driving efficiencies and productivity into the business , including merger integration and continuous improvement efforts . we continue to leverage new technology and data analytics to drive additional efficiencies across the business in response to a transforming landscape . in 2018 , we established a digital transformation initiative that is tasked with identifying the best ways to use digital capabilities throughout our business . modernizing the power grid . our grid improvement programs continue to be a key component of our growth strategy . modernization of the electric grid , including smart meters , storm hardening , self-healing and targeted undergrounding helps to ensure the system is better prepared for severe weather , improves the system 's reliability and flexibility , and provides better information and services for customers . grid improvements enable successful storm response ; for example , in the carolinas , self-healing grid technologies rerouted power from damaged lines and systems to minimize outages . in 2018 , we deployed 1.6 million smart meters resulting in 4.3 million customers having access to this technology across our regulated footprint . generating cleaner energy . we advanced efforts to generate cleaner energy , including progress on several strategic investments during 2018. overall , we have lowered our carbon emissions by over 30 percent since 2005 , consistent with our goal to reduce carbon emissions by 40 percent by 2030. two natural gas plants came online in 2018 and construction continues on a third one . in our commercial renewable business , our shoreham solar facility came online in 2018. expanding the natural gas platform . we continue to pursue natural gas infrastructure investments . we are working diligently to construct the acp pipeline to bring low-cost gas supply and economic development opportunities to the mid-atlantic . while we navigate the impacts of permitting delays and court rulings , we remain steadfast in our commitment to this backbone infrastructure for the southeast u.s. in 2018 , piedmont announced plans to construct a new liquefied natural gas facility in robeson county north carolina on property piedmont already owns . this investment will help piedmont provide a reliable gas supply to customers during peak usage periods . we expect to begin construction in the summer of 2019. dividend growth . in 2018 , duke energy continued to grow the dividend payment to shareholders by approximately 4 percent . 2018 represented the 92nd consecutive year duke energy paid a cash dividend on its common stock . 41 md & a duke energy duke energy objectives – 2019 and beyond duke energy will continue to deliver exceptional value to customers , be an integral part of the communities in which we do business , and provide attractive returns to investors . we have an achievable , long-term strategy in place and it is producing tangible results , yet the industry in which we operate is becoming more and more dynamic . story_separator_special_tag the variance was primarily due to the lower statutory federal corporate tax rate under the tax act , a decrease in pretax income and the impact of the tax act in the prior year . the etrs for the years ended december 31 , 2018 , and 2017 were 20.7 percent and 29.7 percent , respectively . the decrease in the etr was primarily due to the lower statutory federal corporate tax rate under the tax act and the amortization of excess deferred taxes partially offset by the impact of the tax act in the prior year . see the tax act section above for additional information . year ended december 31 , 2017 , as compared to 2016 electric utilities and infrastructure 's results were impacted by the tax act , growth from investments , lower operations and maintenance expense and higher weather-normal retail sales volumes , partially offset by less favorable weather , impairment charges due to regulatory settlements , increased depreciation and amortization , higher interest expense and higher property and other taxes . the following is a detailed discussion of the variance drivers by line item . operating revenues . the variance was driven primarily by : a $ 292 million decrease in retail sales , net of fuel revenue , due to less favorable weather in the current year ; and a $ 235 million decrease in fuel revenues driven by lower retail sales volumes , lower fuel prices included in rates and changes in the generation mix . partially offset by : a $ 364 million increase in rider revenues including increased revenues related to energy efficiency programs , duke energy florida 's nuclear asset securitization , midwest transmission and distribution capital investments and duke energy indiana 's edwardsport igcc plant , as well as an increase in retail pricing due to base rate adjustments for duke energy florida 's osprey acquisition and hines chillers and the duke energy progress south carolina rate case ; an $ 86 million increase in weather-normal sales volumes to customers ; and a $ 26 million increase in other revenues primarily due to favorable transmission revenues . operating expenses . the variance was driven primarily by : a $ 160 million increase in impairment charges primarily due to the write-off of remaining unrecovered levy nuclear project costs in the current year at duke energy florida and the disallowance from rate base of certain projects at the mayo and sutton plants in the current year at duke energy progress related to the partial settlement in the north carolina rate case ; a $ 113 million increase in depreciation and amortization expense primarily due to additional plant in service ; and a $ 58 million increase in property and other taxes primarily due to higher property taxes . 46 md & a segment results - electric utilities and infrastructure partially offset by : a $ 216 million decrease in fuel expense ( including purchased power ) primarily due to lower retail sales and changes in the generation mix ; and a $ 73 million decrease in operation , maintenance and other expense primarily due to lower plant outage , storm restoration and labor and benefits costs partially offset by higher operational costs that are recoverable in rates . interest expense . the variance was due to higher debt outstanding in the current year and duke energy florida 's crystal river unit 3 regulatory asset debt return ending in june 2016 upon securitization . income tax expense . the variance was primarily due to a decrease in pretax income and the impact of the tax act . the effective tax rates for the years ended december 31 , 2017 , and 2016 were 29.7 percent and 35.5 percent , respectively . the decrease in the effective tax rate was primarily due to the impact of the tax act . see the tax act section above for additional information . matters impacting future electric utilities and infrastructure results on may 18 , 2016 , the ncdeq issued proposed risk classifications for all coal ash surface impoundments in north carolina . all ash impoundments not previously designated as high priority by the coal ash act were designated as intermediate risk . certain impoundments classified as intermediate risk , however , were eligible for reassessment as low risk pursuant to legislation enacted on july 14 , 2016. on november 14 , 2018 , ncdeq issued final low-risk classifications for these impoundments , indicating that duke energy carolinas and duke energy progress have satisfied the permanent replacement water supply and certain dam improvement requirements set out in the coal ash management act . as the final closure plans and corrective action measures are developed and approved for each site , the closure work progresses and the closure method scope and remedial action methods are determined , the complexity of work and the amount of coal combustion material could be different than originally estimated and , therefore , could materially impact electric utilities and infrastructure 's results of operations , financial position and cash flows . see note 9 to the consolidated financial statements , `` asset retirement obligations , `` for additional information . duke energy is a party to multiple lawsuits and could be subject to fines and other penalties related to operations at certain north carolina facilities with ash basins . in addition , the orders issued in the duke energy carolinas and duke energy progress north carolinas rate cases supporting recovery of past coal ash remediation costs have been appealed by various parties . the outcome of these appeals , lawsuits and potential fines and penalties could have an adverse impact on electric utilities and infrastructure 's results of operations , financial position , and cash flows . see notes 4 and 5 to the consolidated financial statements , `` regulatory matters `` and “ commitments and contingencies , ” respectively , for additional information . on june 22 , 2018 ,

additionally , during 2012 the company 's airlines provided eight other boeing 767 aircraft and one boeing 757 aircraft to dhl under contracts and arrangements having durations of one year or less . the u.s. military comprised 16 % , 12 % and 14 % of the company 's consolidated revenues during the years ended december 31 , 2012 , 2011 and 2010 , respectively . the company 's airlines con tract their services to the air mobility command ( `` amc `` ) , through the u.s. transportation command ( `` ustc `` ) both of which are organized under the u.s. military . a substantial portion of the company 's revenues and cash flows have historically been derived from providing airlift in north america to bax global , inc. , an affiliate of db schenker ( `` bax/schenker `` ) . bax/schenker is a specialized heavy weight , business to business shipper . in july 2011 , bax/schenker announced its plans to adopt a new operating model that phased out the dedicated air cargo network in north america supported by the company . in september 2011 , bax/schenker ceased air cargo operations at its air hub in toledo , ohio and began to conduct air operations from the cincinnati/northern kentucky airport , utilizing dhl 's u.s. air hub . instead of dedicated aircraft , bax/schenker now utilizes dhl and other delivery services for its air transportation delivery requirements . the company ceased providing services to bax/schenker as of the end of 2011. the company 's revenues from 21 the services performed for bax/schenker , derived primarily by providing boeing 727 and dc-8 airlift , were $ 187.0 million and $ 194.3 million for the years ended december 31 , 2011 and 2010 , respectively . the company 's revenues from bax/schenker comprised approximately 26 % and 29 % of the company 's total revenues during the years ended december 31 , 2011 and 2010 , respectively , ( 15 % and 18 % of total revenues , excluding directly reimbursable revenues ) . the company has two reportable segments : acmi services , which primarily includes the cargo transportation operations of its three airlines and the cam segment . the company 's other business operations , which primarily provide support services to the transportation industry , include aircraft maintenance , aircraft parts sales , ground equipment leasing and mail handling services . these operations do not constitute reportable segments due to their size . results of operations summary the consolidated net earnings from continuing operations were $ 41.6 million and $ 23.9 million for 2012 and 2011 , respectively . the pre-tax earnings from continuing operations were $ 66.3 million and $ 40.9 million for 2012 and 2011 , respectively . the increase in earnings from continuing operations in 2012 as compared to 2011 was primarily due to the 2011 recognition of asset impairment charges of $ 27.1 million , interest rate derivative losses of $ 4.9 million and the write-off of $ 2.9 million of unamortized debt issuance related to the refinancing of the company 's debt in 2011. adjusted pre-tax earnings from continuing operations , a non-gaap measure ( a definition and reconciliation of adjusted pre-tax earnings is shown below ) , after removing impairment charges , net derivative gains or losses and charges related to debt refinancing was $ 64.4 million for 2012 compared to $ 75.8 million for 2011. the adjusted pre-tax earnings in 2012 compared to 2011 was bolstered by increased operations for the company 's boeing 767 and boeing 757 aircraft , but were negatively impacted by the discontinuation of the bax/schenker north american air network in the fourth quarter of 2011. total customer revenues from continuing operations decreased by $ 122.7 million to $ 607.4 million during 2012 compared to 2011. the decline reflects $ 187.0 million of revenues during 2011 from services for the bax/schenker air network which was discontinued . revenues from reimbursed fuel and other reimbursed operating expenses declined by $ 85.7 million during 2012 compared to 2011. these declines were also primarily due to the discontinuation of the bax/schenker air network . excluding directly reimbursed revenues , customer revenues decreased by $ 37.0 million during 2012 compared to 2011. revenue from the deployment of additional boeing 767 and boeing 757 aircraft by acmi services during 2012 , was more than offset by the revenue decline from the discontinuation of the bax/schenker air network . 22 a summary of our revenues and pre-tax earnings from continuing operations is shown below ( in thousands ) : replace_table_token_4_th reimbursable revenues include certain operating costs that are reimbursed to the airlines by their customers . such costs include fuel expense , landing fees and certain aircraft maintenance expenses . the types of costs that are reimbursed varies by customer operating agreement . adjusted pre-tax earnings , a non-gaap measure , is pre-tax earnings excluding asset impairment charges , interest rate derivative gains and losses , the write-off of debt issuance costs and earnings from the termination of the severance and retention agreement ( `` s & r agreement `` ) with dhl in march 2010. management uses adjusted pre-tax earnings to compare the performance of core operating results between periods . adjusted pre-tax earnings , should not be considered in isolation or as a substitute for analysis of the company 's results as reported under gaap . cam through the cam subsidiary , we offer aircraft leasing to external customers and also lease aircraft internally to the company 's airlines . aircraft leases normally cover a term of five to seven years . in a typical leasing agreement , customers pay rent and maintenance deposits on a monthly basis . as of december 31 , 2012 , cam had 48 aircraft in serviceable condition , 28 of them leased internally to the company 's airlines . story_separator_special_tag an additional boeing 767-300 aircraft beginning in may 2012. rent expense was not significantly affected by the discontinuation of the bax/schenker north american air network because the company did not lease the aircraft used in that network . landing and ramp expense , which includes the cost of deicing chemicals , decreased by $ 6.7 million during 2012 compared to 2011. the decrease during 2012 reflects the discontinuation of the bax/schenker north american air network in the fourth quarter of 2011. insurance expense decreased by $ 1.6 million during 2012 compared to 2011 , primarily due to the reduction in boeing 727 and dc-8 aircraft during 2012 and the fourth quarter of 2011. other operating expenses include professional fees , navigational services , employee training , utilities and the cost of parts sold to customers . other operating expenses decreased by $ 2.2 million during 2012 compared to 2011. during 2012 , increased expenses for international aircraft operations were offset by lower costs stemming from the discontinuation of the bax/schenker north american air network . interest expense increased by $ 0.2 million during 2012 compared to 2011. interest expense was higher in 2012 compared to 2011 primarily due to an increase in the amount of borrowings under the revolving credit loan offset by lower interest rates . interest rates on the company 's variable interest , unsubordinated term loan decreased to 2.47 % at december 31 , 2012 from 2.58 % at december 31 , 2011. we expect interest expense to increase during 2013 due to a higher level of debt which is being used to expand the company 's aircraft fleet . during 2012 , the company recorded pre-tax net gains on derivatives of $ 1.9 million compared to pre-tax net losses on derivatives of $ 4.9 million during 2011 , reflecting the impact of higher market interest rates since december 31 , 2011 on the interest rate swaps held by the company at december 31 , 2012. in 2011 , the company executed a senior credit agreement replacing its previous credit agreement . during 2011 , the company wrote off $ 2.9 million of unamortized debt issuance costs associated with the former credit agreement . during 2011 , the company terminated its hedge accounting of interest rate swaps related to the former term loan , which resulted in the recognition of $ 3.9 million of pre-tax losses which had previously been reflected in other comprehensive income . the effective tax rate from continuing operations for the year ended december 31 , 2012 was 37.2 % compared to 41.6 % for 2011. the effective tax rate from continuing operations in 2011 was affected by impairment charges that are not deductible for federal income tax purposes . the company 's effective tax rate from continuing operations was approximately 39 % for the year ended december 31 , 2011 after adjusting for $ 2.8 million of non-deductible impairment charges . the decline in the effective tax rate from continuing operations for 2012 compared to 2011 was also a result of decreased state income taxes for 2012 as a result of the the discontinuation of services for bax/schenker 's north american air network during 2011. we estimate that the company 's effective tax rate for 2013 will be approximately 37.5 % . as of december 31 , 2012 , the company had operating loss carryforwards for u.s. federal income tax purposes of approximately $ 93.4 million , which will begin to expire in 2024 if not utilized before then . we expect to utilize the loss carryforwards to offset federal income tax liabilities in the future . as a result , we do not expect to pay federal income taxes through 2014 or later . the company may , however , be required to pay alternative minimum taxes and certain state and local income taxes before then . the company 's taxable income earned from international flights are primarily sourced to the united states under international aviation agreements and treaties . if we begin to operate in countries without such agreements , the company could incur additional foreign income taxes . 2011 compared to 2010 summary the consolidated net earnings from continuing operations were $ 23.9 million and $ 39.9 million for 2011 and 2010 , respectively . the pre-tax earnings from continuing operations for 2011 were $ 40.9 million , inclusive of asset impairment 28 charges and interest rate derivative losses during 2011 , compared to pre-tax earnings of $ 63.3 million in 2010 , in which no impairment charges or derivative losses were recorded . the decline in earnings from continuing operations in 2011 as compared to 2010 resulted primarily from the recognition of asset impairment charges of $ 27.1 million , interest rate derivative losses of $ 4.9 million and the write-off of $ 2.9 million of unamortized debt issuance costs related to the refinancing of the company 's debt in 2011. adjusted pre-tax earnings from continuing operations , a non-gaap measure ( see reconciliation table below ) , after removing impairment charges , net derivative losses and charges related to debt refinancing was $ 75.8 million for 2011 compared to $ 59.8 million for 2010 after removing pre-tax earnings related to dhl 's restructuring . the improved earnings , as adjusted , over 2010 , was driven primarily by cam , which placed five additional aircraft under external customer leases since december 31 , 2010. the company provided limited airlift directly to bax/schenker from september 2011 through the peak delivery season , until late december 2011. beginning in january 2012 , dhl contracted with the company 's airlines to supplement dhl 's u.s. air network to service bax/schenker freight volumes on its expanded air network without use of the company 's dc-8 aircraft and with only limited use of boeing 727 aircraft . the company 's impairment charges in 2011 stemming from bax/schenker 's 2011 transition to a new u.s. business model are described below : - $

net cash generated from operating activities totaled $ 110.6 million , $ 136.1 million and $ 112.3 million in 2012 , 2011 and 2010 , respectively . cash flows generated from operating activities decreased in 2012 compared to 2011 primarily reflecting payments to vendors associated with the wind-down of the bax/schenker operations , the timing of cash collections from customers and additional pension contributions . cash outlays for pension contributions were $ 24.7 million , $ 18.0 million and $ 36.6 million in 2012 , 2011 and 2010 , respectively . during 2010 , cash flows included the receipt from dhl of amounts in reimbursement for severance payments made to employees and costs incurred arising from the termination of abx 's former contracts with dhl . capital spending levels were primarily the result of aircraft modification costs and the acquisition of aircraft for 33 freighter modification . cash payments for capital expenditures were $ 155.2 million , $ 213.1 million and $ 110.7 million in 2012 , 2011 and 2010 , respectively . capital expenditures in 2012 included $ 134.9 million for the acquisition of two boeing 767-300 aircraft and one boeing 757 aircraft and the costs of aircraft modifications , $ 11.3 million for required heavy maintenance and $ 9.0 million for other equipment costs . our capital expenditures in 2011 included $ 184.3 million for the acquisition and modification of aircraft , $ 21.9 million for required heavy maintenance and $ 6.9 million for other equipment costs . our capital expenditures in 2010 included $ 74.8 million for the acquisition and modification of aircraft , $ 29.9 million for required heavy maintenance and $ 6.0 million for other equipment costs .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```net cash generated from operating activities totaled $ 110.6 million , $ 136.1 million and $ 112.3 million in 2012 , 2011 and 2010 , respectively . cash flows generated from operating activities decreased in 2012 compared to 2011 primarily reflecting payments to vendors associated with the wind-down of the bax/schenker operations , the timing of cash collections from customers and additional pension contributions . cash outlays for pension contributions were $ 24.7 million , $ 18.0 million and $ 36.6 million in 2012 , 2011 and 2010 , respectively . during 2010 , cash flows included the receipt from dhl of amounts in reimbursement for severance payments made to employees and costs incurred arising from the termination of abx 's former contracts with dhl . capital spending levels were primarily the result of aircraft modification costs and the acquisition of aircraft for 33 freighter modification . cash payments for capital expenditures were $ 155.2 million , $ 213.1 million and $ 110.7 million in 2012 , 2011 and 2010 , respectively . capital expenditures in 2012 included $ 134.9 million for the acquisition of two boeing 767-300 aircraft and one boeing 757 aircraft and the costs of aircraft modifications , $ 11.3 million for required heavy maintenance and $ 9.0 million for other equipment costs . our capital expenditures in 2011 included $ 184.3 million for the acquisition and modification of aircraft , $ 21.9 million for required heavy maintenance and $ 6.9 million for other equipment costs . our capital expenditures in 2010 included $ 74.8 million for the acquisition and modification of aircraft , $ 29.9 million for required heavy maintenance and $ 6.0 million for other equipment costs . ``` Suspicious Activity Report : additionally , during 2012 the company 's airlines provided eight other boeing 767 aircraft and one boeing 757 aircraft to dhl under contracts and arrangements having durations of one year or less . the u.s. military comprised 16 % , 12 % and 14 % of the company 's consolidated revenues during the years ended december 31 , 2012 , 2011 and 2010 , respectively . the company 's airlines con tract their services to the air mobility command ( `` amc `` ) , through the u.s. transportation command ( `` ustc `` ) both of which are organized under the u.s. military . a substantial portion of the company 's revenues and cash flows have historically been derived from providing airlift in north america to bax global , inc. , an affiliate of db schenker ( `` bax/schenker `` ) . bax/schenker is a specialized heavy weight , business to business shipper . in july 2011 , bax/schenker announced its plans to adopt a new operating model that phased out the dedicated air cargo network in north america supported by the company . in september 2011 , bax/schenker ceased air cargo operations at its air hub in toledo , ohio and began to conduct air operations from the cincinnati/northern kentucky airport , utilizing dhl 's u.s. air hub . instead of dedicated aircraft , bax/schenker now utilizes dhl and other delivery services for its air transportation delivery requirements . the company ceased providing services to bax/schenker as of the end of 2011. the company 's revenues from 21 the services performed for bax/schenker , derived primarily by providing boeing 727 and dc-8 airlift , were $ 187.0 million and $ 194.3 million for the years ended december 31 , 2011 and 2010 , respectively . the company 's revenues from bax/schenker comprised approximately 26 % and 29 % of the company 's total revenues during the years ended december 31 , 2011 and 2010 , respectively , ( 15 % and 18 % of total revenues , excluding directly reimbursable revenues ) . the company has two reportable segments : acmi services , which primarily includes the cargo transportation operations of its three airlines and the cam segment . the company 's other business operations , which primarily provide support services to the transportation industry , include aircraft maintenance , aircraft parts sales , ground equipment leasing and mail handling services . these operations do not constitute reportable segments due to their size . results of operations summary the consolidated net earnings from continuing operations were $ 41.6 million and $ 23.9 million for 2012 and 2011 , respectively . the pre-tax earnings from continuing operations were $ 66.3 million and $ 40.9 million for 2012 and 2011 , respectively . the increase in earnings from continuing operations in 2012 as compared to 2011 was primarily due to the 2011 recognition of asset impairment charges of $ 27.1 million , interest rate derivative losses of $ 4.9 million and the write-off of $ 2.9 million of unamortized debt issuance related to the refinancing of the company 's debt in 2011. adjusted pre-tax earnings from continuing operations , a non-gaap measure ( a definition and reconciliation of adjusted pre-tax earnings is shown below ) , after removing impairment charges , net derivative gains or losses and charges related to debt refinancing was $ 64.4 million for 2012 compared to $ 75.8 million for 2011. the adjusted pre-tax earnings in 2012 compared to 2011 was bolstered by increased operations for the company 's boeing 767 and boeing 757 aircraft , but were negatively impacted by the discontinuation of the bax/schenker north american air network in the fourth quarter of 2011. total customer revenues from continuing operations decreased by $ 122.7 million to $ 607.4 million during 2012 compared to 2011. the decline reflects $ 187.0 million of revenues during 2011 from services for the bax/schenker air network which was discontinued . revenues from reimbursed fuel and other reimbursed operating expenses declined by $ 85.7 million during 2012 compared to 2011. these declines were also primarily due to the discontinuation of the bax/schenker air network . excluding directly reimbursed revenues , customer revenues decreased by $ 37.0 million during 2012 compared to 2011. revenue from the deployment of additional boeing 767 and boeing 757 aircraft by acmi services during 2012 , was more than offset by the revenue decline from the discontinuation of the bax/schenker air network . 22 a summary of our revenues and pre-tax earnings from continuing operations is shown below ( in thousands ) : replace_table_token_4_th reimbursable revenues include certain operating costs that are reimbursed to the airlines by their customers . such costs include fuel expense , landing fees and certain aircraft maintenance expenses . the types of costs that are reimbursed varies by customer operating agreement . adjusted pre-tax earnings , a non-gaap measure , is pre-tax earnings excluding asset impairment charges , interest rate derivative gains and losses , the write-off of debt issuance costs and earnings from the termination of the severance and retention agreement ( `` s & r agreement `` ) with dhl in march 2010. management uses adjusted pre-tax earnings to compare the performance of core operating results between periods . adjusted pre-tax earnings , should not be considered in isolation or as a substitute for analysis of the company 's results as reported under gaap . cam through the cam subsidiary , we offer aircraft leasing to external customers and also lease aircraft internally to the company 's airlines . aircraft leases normally cover a term of five to seven years . in a typical leasing agreement , customers pay rent and maintenance deposits on a monthly basis . as of december 31 , 2012 , cam had 48 aircraft in serviceable condition , 28 of them leased internally to the company 's airlines . story_separator_special_tag an additional boeing 767-300 aircraft beginning in may 2012. rent expense was not significantly affected by the discontinuation of the bax/schenker north american air network because the company did not lease the aircraft used in that network . landing and ramp expense , which includes the cost of deicing chemicals , decreased by $ 6.7 million during 2012 compared to 2011. the decrease during 2012 reflects the discontinuation of the bax/schenker north american air network in the fourth quarter of 2011. insurance expense decreased by $ 1.6 million during 2012 compared to 2011 , primarily due to the reduction in boeing 727 and dc-8 aircraft during 2012 and the fourth quarter of 2011. other operating expenses include professional fees , navigational services , employee training , utilities and the cost of parts sold to customers . other operating expenses decreased by $ 2.2 million during 2012 compared to 2011. during 2012 , increased expenses for international aircraft operations were offset by lower costs stemming from the discontinuation of the bax/schenker north american air network . interest expense increased by $ 0.2 million during 2012 compared to 2011. interest expense was higher in 2012 compared to 2011 primarily due to an increase in the amount of borrowings under the revolving credit loan offset by lower interest rates . interest rates on the company 's variable interest , unsubordinated term loan decreased to 2.47 % at december 31 , 2012 from 2.58 % at december 31 , 2011. we expect interest expense to increase during 2013 due to a higher level of debt which is being used to expand the company 's aircraft fleet . during 2012 , the company recorded pre-tax net gains on derivatives of $ 1.9 million compared to pre-tax net losses on derivatives of $ 4.9 million during 2011 , reflecting the impact of higher market interest rates since december 31 , 2011 on the interest rate swaps held by the company at december 31 , 2012. in 2011 , the company executed a senior credit agreement replacing its previous credit agreement . during 2011 , the company wrote off $ 2.9 million of unamortized debt issuance costs associated with the former credit agreement . during 2011 , the company terminated its hedge accounting of interest rate swaps related to the former term loan , which resulted in the recognition of $ 3.9 million of pre-tax losses which had previously been reflected in other comprehensive income . the effective tax rate from continuing operations for the year ended december 31 , 2012 was 37.2 % compared to 41.6 % for 2011. the effective tax rate from continuing operations in 2011 was affected by impairment charges that are not deductible for federal income tax purposes . the company 's effective tax rate from continuing operations was approximately 39 % for the year ended december 31 , 2011 after adjusting for $ 2.8 million of non-deductible impairment charges . the decline in the effective tax rate from continuing operations for 2012 compared to 2011 was also a result of decreased state income taxes for 2012 as a result of the the discontinuation of services for bax/schenker 's north american air network during 2011. we estimate that the company 's effective tax rate for 2013 will be approximately 37.5 % . as of december 31 , 2012 , the company had operating loss carryforwards for u.s. federal income tax purposes of approximately $ 93.4 million , which will begin to expire in 2024 if not utilized before then . we expect to utilize the loss carryforwards to offset federal income tax liabilities in the future . as a result , we do not expect to pay federal income taxes through 2014 or later . the company may , however , be required to pay alternative minimum taxes and certain state and local income taxes before then . the company 's taxable income earned from international flights are primarily sourced to the united states under international aviation agreements and treaties . if we begin to operate in countries without such agreements , the company could incur additional foreign income taxes . 2011 compared to 2010 summary the consolidated net earnings from continuing operations were $ 23.9 million and $ 39.9 million for 2011 and 2010 , respectively . the pre-tax earnings from continuing operations for 2011 were $ 40.9 million , inclusive of asset impairment 28 charges and interest rate derivative losses during 2011 , compared to pre-tax earnings of $ 63.3 million in 2010 , in which no impairment charges or derivative losses were recorded . the decline in earnings from continuing operations in 2011 as compared to 2010 resulted primarily from the recognition of asset impairment charges of $ 27.1 million , interest rate derivative losses of $ 4.9 million and the write-off of $ 2.9 million of unamortized debt issuance costs related to the refinancing of the company 's debt in 2011. adjusted pre-tax earnings from continuing operations , a non-gaap measure ( see reconciliation table below ) , after removing impairment charges , net derivative losses and charges related to debt refinancing was $ 75.8 million for 2011 compared to $ 59.8 million for 2010 after removing pre-tax earnings related to dhl 's restructuring . the improved earnings , as adjusted , over 2010 , was driven primarily by cam , which placed five additional aircraft under external customer leases since december 31 , 2010. the company provided limited airlift directly to bax/schenker from september 2011 through the peak delivery season , until late december 2011. beginning in january 2012 , dhl contracted with the company 's airlines to supplement dhl 's u.s. air network to service bax/schenker freight volumes on its expanded air network without use of the company 's dc-8 aircraft and with only limited use of boeing 727 aircraft . the company 's impairment charges in 2011 stemming from bax/schenker 's 2011 transition to a new u.s. business model are described below : - $

all of the shares issued in the ipo were primary shares offered by us as none of our stockholders sold any shares in the ipo . the offering price of the shares sold in the ipo was $ 27.00 per share , resulting in net proceeds to us , after underwriters ' discounts and commissions and other expenses payable by us , of $ 639.1 million . our class a common stock is currently traded on the nasdaq global select market under the symbol `` inov . `` on september 1 , 2015 , pursuant to the terms of a share purchase agreement between the company and avalere ( the `` purchase agreement `` ) , we acquired 100 percent of the capital stock of avalere for an aggregate stated purchase price of $ 140.0 million , consisting of cash and 235,737 shares of the company 's class a common stock which are subject to resale restrictions . the addition of avalere , with its more than 200 pharmaceutical and life sciences clients , as well as an extensive array of client relationships with payors , providers and research institutions , is expected to expand our capabilities and client base into the expansive and adjacent markets of the pharmaceutical and life sciences industry . we incurred transaction costs in connection with the acquisition of approximately $ 1.5 million , which are included in general and administrative expenses . see note 3 ( business combinations ) , included elsewhere within this annual report on form 10-k for more information . during 2015 inovalon announced the introduction of data diagnostics™ to the healthcare marketplace . this technology provides a suite of hundreds of patient-specific analyses that can be ordered individually by clinicians on demand with the answer provided within seconds—all without leaving the clinician 's workflow . the capability leverages vast amounts of data across billions of medical events , interconnectivity , and high-speed cloud-based analytics to allow physician organizations , health 56 plans , accountable care organizations ( acos ) , hospitals , integrated healthcare delivery systems , aso employer groups , government programs , and individual physicians to achieve valuable clinical insights , strong clinical and quality outcomes , utilization efficiency , and overall financial performance on demand and in real time . the technology is delivered in collaboration with quest diagnostics , the nation 's largest laboratory organization , providing large-scale distribution to clinicians through quest 's more than 200,000 care360® provider portal installations and more than 400 integrated ehr platforms serving approximately half of the physicians and hospitals in the united states . during 2015 inovalon invested significant resources as part of the development and anticipated operation and support of data diagnostics™ . while still in the early stages of this platform 's introduction , initial feedback from the marketplace has been very positive . key metrics we review a number of metrics , including the key metrics shown in the table below . we believe that these metrics are indicative of our overall level of analytical activity and the underlying growth in our business . ( in thousands , except percentages ) replace_table_token_8_th ( 1 ) more 2 registry® dataset metrics , and trailing 12 month patient analytics months ( pam ) , each of which is presented in the table , are key operating metrics that management uses to assess our level of operational activity . while we believe that each of these metrics is indicative of our overall level of analytical activity and the underlying growth in our business , increases or decreases in these metrics do not necessarily correlate to proportional increases or decreases in revenue , adjusted ebitda , net income or non-gaap net income . for instance , although increased levels of analytical activity historically have corresponded to increases in revenue over the long term , differences in fees charged for different analytical packages exist and differences in how analytics trigger the applicability of our data-driven intervention platforms may result in increases in analytical activity that do not result in proportional increases in revenue , adjusted ebitda , net income or non-gaap net income ( and vice versa ) . accordingly , while we believe the presentation of these operating metrics is helpful to investors in understanding our business , these metrics have limitations and should not be considered as substitutes for analysis of our financial results reported under gaap . in addition , we believe that other companies , including companies in our industry , do not present similar operating metrics and that there is no commonly accepted method of calculating these metrics , which may reduce their usefulness as comparative measures . ( 2 ) unique patient count is defined as each unique , longitudinally matched , de-identified natural person represented in our more 2 registry® as of the end of the period presented . 57 ( 3 ) medical event count is defined as the total number of discrete medical events as of the end of the period presented ( for example , a discrete medical event typically results from the presentation of a patient to a physician for the diagnosis of diabetes and congestive heart failure in a single visit , the presentation of a patient to an emergency department for chest pain , etc . ) . ( 4 ) patient analytics months , or pam , is defined as the sum of the analytical processes performed on each respective patient within patient populations covered by clients under contract . as used in the metric , an `` analytical process `` is a distinct set of data calculations undertaken by us which is initiated and completed by our analytical platform to examine a specific question such as whether a patient is believed to have a condition such as diabetes , or worsening of the disease , during a specific time period . ( 5 ) revenue mix excludes advisory services . story_separator_special_tag results of operations the following tables set forth our consolidated statement of operations data for each of the periods presented ( in thousands ) : replace_table_token_10_th 63 the following table sets forth our consolidated statement of operations data for each of the periods presented as a percentage of revenue : replace_table_token_11_th years ended december 31 , 2015 , 2014 , and 2013 revenue replace_table_token_12_th 2015 compared with 2014. revenue during the year ended december 31 , 2015 increased by approximately $ 75.7 million , or 21 % , as compared with the year ended december 31 , 2014. the increase was primarily attributable to an increase in revenue from new clients of $ 36.0 million along with a net increase of $ 39.7 million from existing clients . revenue for 2015 includes $ 17.5 million related to the acquisition of avalere . 2014 compared with 2013. revenue during the year ended december 31 , 2014 increased by approximately $ 65.7 million , or 22 % , as compared with the year ended december 31 , 2013. the increase was primarily attributable to an increase in revenue from new clients of $ 50.5 million along with a net increase of $ 15.2 million from existing clients . 64 cost of revenue replace_table_token_13_th 2015 compared with 2014. in 2015 , cost of revenue increased by approximately $ 33.4 million , or 30 % , compared with the year ended december 31 , 2014. the increase in cost of revenue was primarily due to the corresponding increase in revenue of $ 75.7 million or 21 % , during the period and also resulted from an increase in employee-related expenses related partially to the newly acquired data-driven advisory services service line and a greater volume of data-driven intervention platform services as a percentage of total revenue . cost of revenue as a percentage of revenue was 33 % in 2015 compared to 31 % in 2014 . 2014 compared with 2013. in 2014 , cost of revenue decreased by approximately $ 7.3 million , or 6 % , as compared to the year ended december 31 , 2013 , despite the increase in revenue of approximately $ 65.7 million or 22 % , over the same period . the $ 7.3 million decrease in cost of revenue was primarily due to a reduction in employee related expenses . the reduction in employee related expenses was primarily enabled by advances in our technology platform efficiency and a shift in revenue mix towards a greater proportion of analytics versus data-driven intervention services , as well as a greater proportion of automation within the data-driven intervention services mix . cost of revenue as a percentage of revenue was 31 % in 2014 compared to 41 % in 2013. sales and marketing replace_table_token_14_th 2015 compared with 2014. in 2015 , sales and marketing expenses increased by approximately $ 7.5 million , or 106 % , compared to 2014. the increase was primarily attributable to increased employee related expenses of approximately $ 6.5 million , and marketing program spend of approximately $ 1.0 million , both of which was driven by our investment in additional sales personnel to focus on adding new clients and capturing an increased amount of our market opportunity , as well as the addition of the sales and marketing personnel acquired with avalere . 2014 compared with 2013. in 2014 , sales and marketing expenses increased by $ 1.2 million , or 20 % , compared to 2013. the increase primarily was attributable to an increase in employee-related costs . 65 research and development replace_table_token_15_th 2015 compared with 2014. in 2015 , research and development expenses decreased $ 2.8 million as a result of incremental capitalization of internally developed software efforts related to our on-going investment in platform and product innovation , and was partially offset by an increase of $ 2.0 million , which includes $ 1.0 million attributable to stock based compensation expense , attributable to an increase in employee related expenses and professional fees . 2014 compared with 2013. in 2014 , research and development expense increased by $ 1.9 million , or 9 % , compared to 2013. the increase was attributable to our on-going investment in innovation and platform development . general and administrative replace_table_token_16_th 2015 compared with 2014. in 2015 , general and administrative expense increased by approximately $ 26.5 million , or 30 % , compared with 2014. throughout the second half of 2014 and throughout 2015 , we increased our investment in incremental personnel to support our growth and our transition from a private to a public company . our investment resulted in an increase in employee related costs of $ 22.4 million , which includes an increase of approximately $ 3.1 million related to stock-based compensation expense and an increase of $ 7.5 million related to our growth and expansion . in addition , general and administrative expenses for 2015 includes incremental expenses that are not comparable to the prior year , comprised of $ 1.5 million for acquisition-related transaction costs , $ 2.9 million of post-acquisition contingent consideration expense related to the acquisition of avalere , and $ 0.7 million for employer taxes related to stock option awards exercised by employees . the increases in general and administrative expenses for 2015 were partially offset by capitalization of internal-use software development costs of $ 1.0 million compared to the prior period . 2014 compared with 2013. in 2014 , general and administrative expense increased by approximately $ 7.9 million , or 10 % , compared to 2013. the increase was primarily attributable to an increase in employee-related costs of $ 4.2 million , which includes an increase of approximately $ 1.1 million related to stock based compensation expense , professional fees of $ 1.8 million , occupancy costs of $ 1.1 million , and software licensing and maintenance expenses of $ 0.5 million . 66 depreciation and amortization replace_table_token_17_th 2015 compared with 2014. in 2015 ,

debt on september 19 , 2014 , we and our subsidiaries entered into a credit and guaranty agreement with a group of lenders including goldman sachs bank usa , as administrative agent ( the `` credit agreement '' ) . the terms of the credit agreement provide for credit facilities in the aggregate maximum principal amount of $ 400.0 million , consisting of a senior unsecured term loan facility in the original principal amount of $ 300,000 ( the `` term loan facility '' ) and a senior unsecured revolving credit facility in the maximum principal amount of $ 100,000 ( the `` revolving credit facility '' and , together with the term loan facility , the `` credit facilities '' ) . proceeds of the revolving credit facility may be used for our working capital and general corporate purposes . the obligations under the credit facilities are guaranteed by our domestic , wholly owned subsidiaries . the credit facilities contain customary affirmative and negative covenants , including limitations on negative pledges and liens . in addition , under the credit agreement , we are required to maintain certain minimum liquidity levels ( $ 50.0 million while the term loan facility remains available , or , if the term loan facility has been repaid , $ 20.0 million ) , measured at the end of each of our fiscal quarters . in addition , our ability to incur debt is subject to compliance with a 4.00 to 1.00 leverage ratio under certain circumstances . the credit agreement also contains certain mandatory prepayment requirements in connection with certain assets sales and customary events of default , including as a result of certain specified change of control events . as of , and during , the year ended december 31 , 2015 , the company was in compliance with the financial covenants under the credit agreement . term loan facility we utilized the entire principal amount of the term loan facility to redeem approximately 8.33 % of our class b common stock on a pro rata basis in september 2014. as of december 31 , 2015 , the principal amount outstanding under the term loan facility was $ 281.3 million .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```debt on september 19 , 2014 , we and our subsidiaries entered into a credit and guaranty agreement with a group of lenders including goldman sachs bank usa , as administrative agent ( the `` credit agreement '' ) . the terms of the credit agreement provide for credit facilities in the aggregate maximum principal amount of $ 400.0 million , consisting of a senior unsecured term loan facility in the original principal amount of $ 300,000 ( the `` term loan facility '' ) and a senior unsecured revolving credit facility in the maximum principal amount of $ 100,000 ( the `` revolving credit facility '' and , together with the term loan facility , the `` credit facilities '' ) . proceeds of the revolving credit facility may be used for our working capital and general corporate purposes . the obligations under the credit facilities are guaranteed by our domestic , wholly owned subsidiaries . the credit facilities contain customary affirmative and negative covenants , including limitations on negative pledges and liens . in addition , under the credit agreement , we are required to maintain certain minimum liquidity levels ( $ 50.0 million while the term loan facility remains available , or , if the term loan facility has been repaid , $ 20.0 million ) , measured at the end of each of our fiscal quarters . in addition , our ability to incur debt is subject to compliance with a 4.00 to 1.00 leverage ratio under certain circumstances . the credit agreement also contains certain mandatory prepayment requirements in connection with certain assets sales and customary events of default , including as a result of certain specified change of control events . as of , and during , the year ended december 31 , 2015 , the company was in compliance with the financial covenants under the credit agreement . term loan facility we utilized the entire principal amount of the term loan facility to redeem approximately 8.33 % of our class b common stock on a pro rata basis in september 2014. as of december 31 , 2015 , the principal amount outstanding under the term loan facility was $ 281.3 million . ``` Suspicious Activity Report : all of the shares issued in the ipo were primary shares offered by us as none of our stockholders sold any shares in the ipo . the offering price of the shares sold in the ipo was $ 27.00 per share , resulting in net proceeds to us , after underwriters ' discounts and commissions and other expenses payable by us , of $ 639.1 million . our class a common stock is currently traded on the nasdaq global select market under the symbol `` inov . `` on september 1 , 2015 , pursuant to the terms of a share purchase agreement between the company and avalere ( the `` purchase agreement `` ) , we acquired 100 percent of the capital stock of avalere for an aggregate stated purchase price of $ 140.0 million , consisting of cash and 235,737 shares of the company 's class a common stock which are subject to resale restrictions . the addition of avalere , with its more than 200 pharmaceutical and life sciences clients , as well as an extensive array of client relationships with payors , providers and research institutions , is expected to expand our capabilities and client base into the expansive and adjacent markets of the pharmaceutical and life sciences industry . we incurred transaction costs in connection with the acquisition of approximately $ 1.5 million , which are included in general and administrative expenses . see note 3 ( business combinations ) , included elsewhere within this annual report on form 10-k for more information . during 2015 inovalon announced the introduction of data diagnostics™ to the healthcare marketplace . this technology provides a suite of hundreds of patient-specific analyses that can be ordered individually by clinicians on demand with the answer provided within seconds—all without leaving the clinician 's workflow . the capability leverages vast amounts of data across billions of medical events , interconnectivity , and high-speed cloud-based analytics to allow physician organizations , health 56 plans , accountable care organizations ( acos ) , hospitals , integrated healthcare delivery systems , aso employer groups , government programs , and individual physicians to achieve valuable clinical insights , strong clinical and quality outcomes , utilization efficiency , and overall financial performance on demand and in real time . the technology is delivered in collaboration with quest diagnostics , the nation 's largest laboratory organization , providing large-scale distribution to clinicians through quest 's more than 200,000 care360® provider portal installations and more than 400 integrated ehr platforms serving approximately half of the physicians and hospitals in the united states . during 2015 inovalon invested significant resources as part of the development and anticipated operation and support of data diagnostics™ . while still in the early stages of this platform 's introduction , initial feedback from the marketplace has been very positive . key metrics we review a number of metrics , including the key metrics shown in the table below . we believe that these metrics are indicative of our overall level of analytical activity and the underlying growth in our business . ( in thousands , except percentages ) replace_table_token_8_th ( 1 ) more 2 registry® dataset metrics , and trailing 12 month patient analytics months ( pam ) , each of which is presented in the table , are key operating metrics that management uses to assess our level of operational activity . while we believe that each of these metrics is indicative of our overall level of analytical activity and the underlying growth in our business , increases or decreases in these metrics do not necessarily correlate to proportional increases or decreases in revenue , adjusted ebitda , net income or non-gaap net income . for instance , although increased levels of analytical activity historically have corresponded to increases in revenue over the long term , differences in fees charged for different analytical packages exist and differences in how analytics trigger the applicability of our data-driven intervention platforms may result in increases in analytical activity that do not result in proportional increases in revenue , adjusted ebitda , net income or non-gaap net income ( and vice versa ) . accordingly , while we believe the presentation of these operating metrics is helpful to investors in understanding our business , these metrics have limitations and should not be considered as substitutes for analysis of our financial results reported under gaap . in addition , we believe that other companies , including companies in our industry , do not present similar operating metrics and that there is no commonly accepted method of calculating these metrics , which may reduce their usefulness as comparative measures . ( 2 ) unique patient count is defined as each unique , longitudinally matched , de-identified natural person represented in our more 2 registry® as of the end of the period presented . 57 ( 3 ) medical event count is defined as the total number of discrete medical events as of the end of the period presented ( for example , a discrete medical event typically results from the presentation of a patient to a physician for the diagnosis of diabetes and congestive heart failure in a single visit , the presentation of a patient to an emergency department for chest pain , etc . ) . ( 4 ) patient analytics months , or pam , is defined as the sum of the analytical processes performed on each respective patient within patient populations covered by clients under contract . as used in the metric , an `` analytical process `` is a distinct set of data calculations undertaken by us which is initiated and completed by our analytical platform to examine a specific question such as whether a patient is believed to have a condition such as diabetes , or worsening of the disease , during a specific time period . ( 5 ) revenue mix excludes advisory services . story_separator_special_tag results of operations the following tables set forth our consolidated statement of operations data for each of the periods presented ( in thousands ) : replace_table_token_10_th 63 the following table sets forth our consolidated statement of operations data for each of the periods presented as a percentage of revenue : replace_table_token_11_th years ended december 31 , 2015 , 2014 , and 2013 revenue replace_table_token_12_th 2015 compared with 2014. revenue during the year ended december 31 , 2015 increased by approximately $ 75.7 million , or 21 % , as compared with the year ended december 31 , 2014. the increase was primarily attributable to an increase in revenue from new clients of $ 36.0 million along with a net increase of $ 39.7 million from existing clients . revenue for 2015 includes $ 17.5 million related to the acquisition of avalere . 2014 compared with 2013. revenue during the year ended december 31 , 2014 increased by approximately $ 65.7 million , or 22 % , as compared with the year ended december 31 , 2013. the increase was primarily attributable to an increase in revenue from new clients of $ 50.5 million along with a net increase of $ 15.2 million from existing clients . 64 cost of revenue replace_table_token_13_th 2015 compared with 2014. in 2015 , cost of revenue increased by approximately $ 33.4 million , or 30 % , compared with the year ended december 31 , 2014. the increase in cost of revenue was primarily due to the corresponding increase in revenue of $ 75.7 million or 21 % , during the period and also resulted from an increase in employee-related expenses related partially to the newly acquired data-driven advisory services service line and a greater volume of data-driven intervention platform services as a percentage of total revenue . cost of revenue as a percentage of revenue was 33 % in 2015 compared to 31 % in 2014 . 2014 compared with 2013. in 2014 , cost of revenue decreased by approximately $ 7.3 million , or 6 % , as compared to the year ended december 31 , 2013 , despite the increase in revenue of approximately $ 65.7 million or 22 % , over the same period . the $ 7.3 million decrease in cost of revenue was primarily due to a reduction in employee related expenses . the reduction in employee related expenses was primarily enabled by advances in our technology platform efficiency and a shift in revenue mix towards a greater proportion of analytics versus data-driven intervention services , as well as a greater proportion of automation within the data-driven intervention services mix . cost of revenue as a percentage of revenue was 31 % in 2014 compared to 41 % in 2013. sales and marketing replace_table_token_14_th 2015 compared with 2014. in 2015 , sales and marketing expenses increased by approximately $ 7.5 million , or 106 % , compared to 2014. the increase was primarily attributable to increased employee related expenses of approximately $ 6.5 million , and marketing program spend of approximately $ 1.0 million , both of which was driven by our investment in additional sales personnel to focus on adding new clients and capturing an increased amount of our market opportunity , as well as the addition of the sales and marketing personnel acquired with avalere . 2014 compared with 2013. in 2014 , sales and marketing expenses increased by $ 1.2 million , or 20 % , compared to 2013. the increase primarily was attributable to an increase in employee-related costs . 65 research and development replace_table_token_15_th 2015 compared with 2014. in 2015 , research and development expenses decreased $ 2.8 million as a result of incremental capitalization of internally developed software efforts related to our on-going investment in platform and product innovation , and was partially offset by an increase of $ 2.0 million , which includes $ 1.0 million attributable to stock based compensation expense , attributable to an increase in employee related expenses and professional fees . 2014 compared with 2013. in 2014 , research and development expense increased by $ 1.9 million , or 9 % , compared to 2013. the increase was attributable to our on-going investment in innovation and platform development . general and administrative replace_table_token_16_th 2015 compared with 2014. in 2015 , general and administrative expense increased by approximately $ 26.5 million , or 30 % , compared with 2014. throughout the second half of 2014 and throughout 2015 , we increased our investment in incremental personnel to support our growth and our transition from a private to a public company . our investment resulted in an increase in employee related costs of $ 22.4 million , which includes an increase of approximately $ 3.1 million related to stock-based compensation expense and an increase of $ 7.5 million related to our growth and expansion . in addition , general and administrative expenses for 2015 includes incremental expenses that are not comparable to the prior year , comprised of $ 1.5 million for acquisition-related transaction costs , $ 2.9 million of post-acquisition contingent consideration expense related to the acquisition of avalere , and $ 0.7 million for employer taxes related to stock option awards exercised by employees . the increases in general and administrative expenses for 2015 were partially offset by capitalization of internal-use software development costs of $ 1.0 million compared to the prior period . 2014 compared with 2013. in 2014 , general and administrative expense increased by approximately $ 7.9 million , or 10 % , compared to 2013. the increase was primarily attributable to an increase in employee-related costs of $ 4.2 million , which includes an increase of approximately $ 1.1 million related to stock based compensation expense , professional fees of $ 1.8 million , occupancy costs of $ 1.1 million , and software licensing and maintenance expenses of $ 0.5 million . 66 depreciation and amortization replace_table_token_17_th 2015 compared with 2014. in 2015 ,

quality and customer service are the cornerstones of our strategy and were instrumental in our turnaround in financial performance in 2018 and 2019. we began by focusing on call center metrics in the u.s. , europe and australia , and reduced the average wait time from over 10 minutes in 2017 to 2 minutes in 2018 to under 2 minutes by the end of 2019. we introduced self-service tools such as the service-on-the-go that allow our installers and partners to submit requests from their phone in less than 60 seconds . the launch of our iq 7 series microinverter worldwide , the smallest , lightest and most powerful microinverter we have ever made , was a key factor in improving gross margin . every region of the world where our products are sold is now using this seventh-generation microinverter . during year ended december 31 , 2019 , 98 % of our microinverter shipments were iq 7. we systematically rolled out high-power and high-efficiency variants of the iq 7 microinverters in 2018. selling these variants simultaneously improved gross margin and delivered a better price per watt for the installer . enphase energy , inc. | 2019 form 10-k | 40 on january 28 , 2019 , we repaid in full the remaining principal amount of the term loans of approximately $ 39.5 million plus accrued interest and fees owed to lenders affiliated with tennenbaum capital partners , llc . on may 30 , 2019 , we entered into separately and privately negotiated transactions with certain holders of our 4.0 % convertible senior notes due 2023 ( “ notes due 2023 ” ) resulting in the repurchase and exchange , as of june 5 , 2019 , of $ 60.0 million aggregate principal amount of the notes in consideration for the issuance of 10,801,080 shares of common stock and separate cash payments totaling $ 6.0 million . on june 5 , 2019 , we issued $ 132.0 million aggregate principal amount of our 1.0 % convertible senior notes due 2024 ( the “ notes due 2024 ” ) in a private placement . the notes due 2024 are general unsecured obligations and bear interest at a rate of 1.0 % per year , payable semi-annually on june 1 and december 1 of each year , beginning on december 1 , 2019 . the notes due 2024 will mature on june 1 , 2024 , unless earlier repurchased by us or converted at the option of the holders . further information relating to the notes due 2024 may be found in note 11 , “ debt , ” of the notes to consolidated financial statements included in part ii , item 8 of this annual report on form 10-k and below under “ liquidity and capital resources . ” 2020 outlook we believe our solid execution in 2019 positions us well to take advantage of future growth opportunities , and we need to maintain our focus in order to capitalize on such opportunities . our top three priorities for 2020 are ( i ) providing a remarkable customer experience , ( ii ) introduction of new products and expansion of our markets , and ( iii ) focus on enhancements to our comprehensive digital platform . customer experience . quality and customer service constitute customer experience . this has remained a priority for three years running . on the service front , our installer , distributor and module partners are our first line of association with our ultimate customer , the homeowner and business user . our goals are to partner better with these service providers so that we can provide exceptional high quality service to our homeowner . we are convinced that continued reinforcement of customer experience improvements can be a competitive advantage for us . introduce new products and expand our market . we are focused on residential solar in a dozen countries providing serviceable available market ( ‘ sam ' ) of approximately $ 3.3 billion in 2019. we also plan to introduce new products in 2020 which will take our sam to $ 12.5 billion in 2022 which will comprise of residential solar , residential storage , small commercial solar and off-grid solar and storage . expand our digital presence . we are focused on generating revenue through digitalization of the business-to-business and business-to-customer process of the partner and customer journey . future key focus is to expand our digital presence through enhancing our online store , increasing the use of the online store significantly , and releasing a comprehensive digital platform . components of consolidated statements of operations net revenues we primarily generate net revenues from sales of our microinverter solutions and related accessories , which can include our ac battery storage systems , our envoy communications gateway and enlighten cloud-based monitoring service as well as other accessories . our revenue is affected by changes in the volume and average selling prices of our solutions and related accessories , supply and demand , sales incentives , and competitive product offerings . our revenue growth is dependent on our ability to compete effectively in the marketplace by remaining cost competitive , developing and introducing new products that meet the changing technology and performance requirements of our customers , the diversification and expansion of our revenue base , and our ability to market our products in a manner that increases awareness for microinverter technology and differentiates us in the marketplace . enphase energy , inc. | 2019 form 10-k | 41 cost of revenues and gross profit cost of revenues is comprised primarily of product costs , warranty , manufacturing personnel and logistics costs , freight costs , depreciation and amortization of test equipment and hosting services costs . our product costs are impacted by technological innovations , such as advances in semiconductor integration and new product introductions , economies of scale resulting in lower component costs , and improvements in production processes and automation . story_separator_special_tag ( as defined in the relevant indenture ) per $ 1,000 principal amount of notes for each trading day of the measurement period was less than 98 % of the product of the last reported sale price of the our common stock and the conversion rate on each such trading day ; or ( 3 ) upon the occurrence of specified corporate events . upon conversion of any of the notes , we will pay or deliver , as the case may be , cash , shares of common stock or a combination of cash and common stock , at our election . in connection with the offering of the notes due 2024 , we entered into privately-negotiated convertible note hedge transactions in order to reduce the potential dilution to our common stock upon any conversion of the notes due 2024 . the total cost of the convertible note hedge transactions was approximately $ 36.3 million . also , concurrently with the offering of the notes due 2024 , we entered into privately-negotiated warrant transactions whereby we issued warrants to acquire shares of our common stock at a strike price of $ 25.2320 rather than the notes due 2024 conversion price of $ 20.5010 . we received approximately $ 29.8 million from the sale of the warrants . as of february 21 , 2020 , the notes due 2024 were not converted into equity , therefore , we had not purchased any shares under the convertible note hedge and the warrants had not been exercised and remain outstanding . if holders of the notes due 2024 are able to convert the debt to equity , and exercise that right , we have asserted our intent and ability to settle the $ 132.0 million aggregate principal amount of the notes due 2024 in cash . see note 11 , “ debt , ” of the notes to consolidated financial statements included in part ii , item 8 of this annual report on form 10-k for more information relating to the convertible note hedge transactions and warrants . we believe that our existing cash and cash equivalents and cash flows from our operating activities will be sufficient to meet our anticipated cash needs for at least the next 12 months . story_separator_special_tag style= `` line-height:120 % ; padding-bottom:8px ; padding-top:8px ; text-align : justify ; text-indent:36px ; font-size:10pt ; `` > revenues are recognized when control of the promised goods or services are transferred to our customers in an amount that reflects the consideration that is expected to be received in exchange for those goods or services . we generate all of our revenues from contracts with our customers . a description of principal activities from which we generate revenues are as follows . products delivered at a point in time . we sell our products to customers in accordance with the terms of the related customer contracts . we generate revenues from sales of our solutions , which include microinverter units and related accessories , an envoy communications gateway and enlighten service , communications accessories and ac battery storage solutions to distributors , large installers , oems and strategic partners . microinverter units , microinverter accessories , and ac battery storage solutions are delivered to customers at a point in time , and we recognize revenue for these products when we transfer control of the product to the customer , which is generally upon shipment . products delivered over time . the sale of an envoy communications gateway includes our enlighten cloud-based monitoring service . the full consideration for these products represents a single performance obligation and is deferred at the sale date and recognized over the estimated service period of 6 years . we also sell certain communication accessories that are delivered over time . the revenue from these products is recognized over the related service period , which is typically 5 or 12 years . we previously sold envoy communications device to certain customers under a long-term financing arrangement . under this financing arrangement , we net the unbilled receivables against deferred revenue . we record certain contra revenue promotions as variable consideration and recognizes these promotions at the time the related revenue is recorded . enphase energy , inc. | 2019 form 10-k | 49 we record upfront contract acquisition costs , such as sales commissions , to be capitalized and amortized over the estimated life of the asset . for contracts that have a duration of less than one year , we follow the topic 606 practical expedient and expense these costs when incurred . commissions related to our sale of monitoring hardware and service are capitalized and amortized over the period of the associated revenue . see note 3 . “ revenue recognition , ” of the notes to consolidated financial statements included in part ii , item 8 of this annual report on form 10-k for additional information related to revenue recognition . inventory inventory is valued at the lower of cost or market . market is current replacement cost ( by purchase or by reproduction , dependent on the type of inventory ) . in cases where market exceeds net realizable value ( i.e . , estimated selling price less reasonably predictable costs of completion and disposal ) , inventories are stated at net realizable value . market is not considered to be less than net realizable value reduced by an allowance for an approximately normal profit margin . we determine cost on a first-in first-out basis . certain factors could affect the realizable value of its inventory , including customer demand and market conditions . management assesses the valuation on a quarterly basis and writes down the value for any excess and obsolete inventory based upon expected demand , anticipated sales price , effect of new product introductions , product obsolescence , customer concentrations , product merchantability and other factors . inventory write-downs are equal to the difference between the cost of inventories

cash flows . the following table summarizes our cash flows for the periods presented : replace_table_token_12_th enphase energy , inc. | 2019 form 10-k | 47 c ash flows from operating activities for the year ended december 31 , 2019 , net cash provided by operating activities was $ 139.1 million compared to net cash provided by operating activities of $ 16.1 million in 2018 , an increase of $ 122.9 million year-over-year . the $ 122.9 million increase in net cash provided by operating activities in 2019 compared to 2018 , was primarily due to higher profitability in 2019 of $ 172.8 million higher net income , partially offset by higher net non-cash benefit of $ 49.7 million . the higher net non-cash benefit of $ 49.7 million in 2019 , compared to 2018 , is comprised of $ 73.4 million higher deferred income tax benefit due to the release of the valuation allowance against our deferred tax assets , $ 0.5 million lower provision for doubtful accounts and $ 0.5 million lower asset impairment , partially offset by higher non-cash charges for $ 8.7 million higher stock-based compensation , $ 6.0 million fees paid for repurchase and exchange of convertible notes due 2023 , $ 2.2 million financing fees on extinguishment of term loans , $ 4.5 million higher depreciation on property and equipment and $ 3.4 million higher non-cash interest expense primarily due to debt discount on notes due 2024. the changes in the working capital year-over-year was neutral as our growth in deferred revenue of $ 78.4 million , including $ 49.9 million of safe harbor prepayments , was offset by our growth in accounts receivable of $ 55.2 million and inventory of $ 25.5 million in 2019 , compared to 2018. cash flows from investing activities for the year ended december 31 , 2019 , net cash used in investing activities was $ 14.8 million , primarily from purchases of test and assembly equipment to expand our supply capacity and related facility improvements , and capitalized costs related to internal-use software .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```cash flows . the following table summarizes our cash flows for the periods presented : replace_table_token_12_th enphase energy , inc. | 2019 form 10-k | 47 c ash flows from operating activities for the year ended december 31 , 2019 , net cash provided by operating activities was $ 139.1 million compared to net cash provided by operating activities of $ 16.1 million in 2018 , an increase of $ 122.9 million year-over-year . the $ 122.9 million increase in net cash provided by operating activities in 2019 compared to 2018 , was primarily due to higher profitability in 2019 of $ 172.8 million higher net income , partially offset by higher net non-cash benefit of $ 49.7 million . the higher net non-cash benefit of $ 49.7 million in 2019 , compared to 2018 , is comprised of $ 73.4 million higher deferred income tax benefit due to the release of the valuation allowance against our deferred tax assets , $ 0.5 million lower provision for doubtful accounts and $ 0.5 million lower asset impairment , partially offset by higher non-cash charges for $ 8.7 million higher stock-based compensation , $ 6.0 million fees paid for repurchase and exchange of convertible notes due 2023 , $ 2.2 million financing fees on extinguishment of term loans , $ 4.5 million higher depreciation on property and equipment and $ 3.4 million higher non-cash interest expense primarily due to debt discount on notes due 2024. the changes in the working capital year-over-year was neutral as our growth in deferred revenue of $ 78.4 million , including $ 49.9 million of safe harbor prepayments , was offset by our growth in accounts receivable of $ 55.2 million and inventory of $ 25.5 million in 2019 , compared to 2018. cash flows from investing activities for the year ended december 31 , 2019 , net cash used in investing activities was $ 14.8 million , primarily from purchases of test and assembly equipment to expand our supply capacity and related facility improvements , and capitalized costs related to internal-use software . ``` Suspicious Activity Report : quality and customer service are the cornerstones of our strategy and were instrumental in our turnaround in financial performance in 2018 and 2019. we began by focusing on call center metrics in the u.s. , europe and australia , and reduced the average wait time from over 10 minutes in 2017 to 2 minutes in 2018 to under 2 minutes by the end of 2019. we introduced self-service tools such as the service-on-the-go that allow our installers and partners to submit requests from their phone in less than 60 seconds . the launch of our iq 7 series microinverter worldwide , the smallest , lightest and most powerful microinverter we have ever made , was a key factor in improving gross margin . every region of the world where our products are sold is now using this seventh-generation microinverter . during year ended december 31 , 2019 , 98 % of our microinverter shipments were iq 7. we systematically rolled out high-power and high-efficiency variants of the iq 7 microinverters in 2018. selling these variants simultaneously improved gross margin and delivered a better price per watt for the installer . enphase energy , inc. | 2019 form 10-k | 40 on january 28 , 2019 , we repaid in full the remaining principal amount of the term loans of approximately $ 39.5 million plus accrued interest and fees owed to lenders affiliated with tennenbaum capital partners , llc . on may 30 , 2019 , we entered into separately and privately negotiated transactions with certain holders of our 4.0 % convertible senior notes due 2023 ( “ notes due 2023 ” ) resulting in the repurchase and exchange , as of june 5 , 2019 , of $ 60.0 million aggregate principal amount of the notes in consideration for the issuance of 10,801,080 shares of common stock and separate cash payments totaling $ 6.0 million . on june 5 , 2019 , we issued $ 132.0 million aggregate principal amount of our 1.0 % convertible senior notes due 2024 ( the “ notes due 2024 ” ) in a private placement . the notes due 2024 are general unsecured obligations and bear interest at a rate of 1.0 % per year , payable semi-annually on june 1 and december 1 of each year , beginning on december 1 , 2019 . the notes due 2024 will mature on june 1 , 2024 , unless earlier repurchased by us or converted at the option of the holders . further information relating to the notes due 2024 may be found in note 11 , “ debt , ” of the notes to consolidated financial statements included in part ii , item 8 of this annual report on form 10-k and below under “ liquidity and capital resources . ” 2020 outlook we believe our solid execution in 2019 positions us well to take advantage of future growth opportunities , and we need to maintain our focus in order to capitalize on such opportunities . our top three priorities for 2020 are ( i ) providing a remarkable customer experience , ( ii ) introduction of new products and expansion of our markets , and ( iii ) focus on enhancements to our comprehensive digital platform . customer experience . quality and customer service constitute customer experience . this has remained a priority for three years running . on the service front , our installer , distributor and module partners are our first line of association with our ultimate customer , the homeowner and business user . our goals are to partner better with these service providers so that we can provide exceptional high quality service to our homeowner . we are convinced that continued reinforcement of customer experience improvements can be a competitive advantage for us . introduce new products and expand our market . we are focused on residential solar in a dozen countries providing serviceable available market ( ‘ sam ' ) of approximately $ 3.3 billion in 2019. we also plan to introduce new products in 2020 which will take our sam to $ 12.5 billion in 2022 which will comprise of residential solar , residential storage , small commercial solar and off-grid solar and storage . expand our digital presence . we are focused on generating revenue through digitalization of the business-to-business and business-to-customer process of the partner and customer journey . future key focus is to expand our digital presence through enhancing our online store , increasing the use of the online store significantly , and releasing a comprehensive digital platform . components of consolidated statements of operations net revenues we primarily generate net revenues from sales of our microinverter solutions and related accessories , which can include our ac battery storage systems , our envoy communications gateway and enlighten cloud-based monitoring service as well as other accessories . our revenue is affected by changes in the volume and average selling prices of our solutions and related accessories , supply and demand , sales incentives , and competitive product offerings . our revenue growth is dependent on our ability to compete effectively in the marketplace by remaining cost competitive , developing and introducing new products that meet the changing technology and performance requirements of our customers , the diversification and expansion of our revenue base , and our ability to market our products in a manner that increases awareness for microinverter technology and differentiates us in the marketplace . enphase energy , inc. | 2019 form 10-k | 41 cost of revenues and gross profit cost of revenues is comprised primarily of product costs , warranty , manufacturing personnel and logistics costs , freight costs , depreciation and amortization of test equipment and hosting services costs . our product costs are impacted by technological innovations , such as advances in semiconductor integration and new product introductions , economies of scale resulting in lower component costs , and improvements in production processes and automation . story_separator_special_tag ( as defined in the relevant indenture ) per $ 1,000 principal amount of notes for each trading day of the measurement period was less than 98 % of the product of the last reported sale price of the our common stock and the conversion rate on each such trading day ; or ( 3 ) upon the occurrence of specified corporate events . upon conversion of any of the notes , we will pay or deliver , as the case may be , cash , shares of common stock or a combination of cash and common stock , at our election . in connection with the offering of the notes due 2024 , we entered into privately-negotiated convertible note hedge transactions in order to reduce the potential dilution to our common stock upon any conversion of the notes due 2024 . the total cost of the convertible note hedge transactions was approximately $ 36.3 million . also , concurrently with the offering of the notes due 2024 , we entered into privately-negotiated warrant transactions whereby we issued warrants to acquire shares of our common stock at a strike price of $ 25.2320 rather than the notes due 2024 conversion price of $ 20.5010 . we received approximately $ 29.8 million from the sale of the warrants . as of february 21 , 2020 , the notes due 2024 were not converted into equity , therefore , we had not purchased any shares under the convertible note hedge and the warrants had not been exercised and remain outstanding . if holders of the notes due 2024 are able to convert the debt to equity , and exercise that right , we have asserted our intent and ability to settle the $ 132.0 million aggregate principal amount of the notes due 2024 in cash . see note 11 , “ debt , ” of the notes to consolidated financial statements included in part ii , item 8 of this annual report on form 10-k for more information relating to the convertible note hedge transactions and warrants . we believe that our existing cash and cash equivalents and cash flows from our operating activities will be sufficient to meet our anticipated cash needs for at least the next 12 months . story_separator_special_tag style= `` line-height:120 % ; padding-bottom:8px ; padding-top:8px ; text-align : justify ; text-indent:36px ; font-size:10pt ; `` > revenues are recognized when control of the promised goods or services are transferred to our customers in an amount that reflects the consideration that is expected to be received in exchange for those goods or services . we generate all of our revenues from contracts with our customers . a description of principal activities from which we generate revenues are as follows . products delivered at a point in time . we sell our products to customers in accordance with the terms of the related customer contracts . we generate revenues from sales of our solutions , which include microinverter units and related accessories , an envoy communications gateway and enlighten service , communications accessories and ac battery storage solutions to distributors , large installers , oems and strategic partners . microinverter units , microinverter accessories , and ac battery storage solutions are delivered to customers at a point in time , and we recognize revenue for these products when we transfer control of the product to the customer , which is generally upon shipment . products delivered over time . the sale of an envoy communications gateway includes our enlighten cloud-based monitoring service . the full consideration for these products represents a single performance obligation and is deferred at the sale date and recognized over the estimated service period of 6 years . we also sell certain communication accessories that are delivered over time . the revenue from these products is recognized over the related service period , which is typically 5 or 12 years . we previously sold envoy communications device to certain customers under a long-term financing arrangement . under this financing arrangement , we net the unbilled receivables against deferred revenue . we record certain contra revenue promotions as variable consideration and recognizes these promotions at the time the related revenue is recorded . enphase energy , inc. | 2019 form 10-k | 49 we record upfront contract acquisition costs , such as sales commissions , to be capitalized and amortized over the estimated life of the asset . for contracts that have a duration of less than one year , we follow the topic 606 practical expedient and expense these costs when incurred . commissions related to our sale of monitoring hardware and service are capitalized and amortized over the period of the associated revenue . see note 3 . “ revenue recognition , ” of the notes to consolidated financial statements included in part ii , item 8 of this annual report on form 10-k for additional information related to revenue recognition . inventory inventory is valued at the lower of cost or market . market is current replacement cost ( by purchase or by reproduction , dependent on the type of inventory ) . in cases where market exceeds net realizable value ( i.e . , estimated selling price less reasonably predictable costs of completion and disposal ) , inventories are stated at net realizable value . market is not considered to be less than net realizable value reduced by an allowance for an approximately normal profit margin . we determine cost on a first-in first-out basis . certain factors could affect the realizable value of its inventory , including customer demand and market conditions . management assesses the valuation on a quarterly basis and writes down the value for any excess and obsolete inventory based upon expected demand , anticipated sales price , effect of new product introductions , product obsolescence , customer concentrations , product merchantability and other factors . inventory write-downs are equal to the difference between the cost of inventories

in march 2020 , the world health organization declared the covid-19 outbreak to be a pandemic . since then , the covid-19 pandemic has rapidly spread across the globe and has already resulted in significant volatility , uncertainty , and economic disruption . thus far , the impact of the pandemic has been modest with some customers , particularly in heavily impacted industries , requesting special billing or payment terms . our gross retention rate for the fourth quarter of fiscal 2021 remained consistently high and our dollar-based net retention rate once again exceeded 120 percent as we continued to expand module adoption within new and existing customers . in march 2020 , we implemented several measures to help protect the health and safety of our employees around the globe including restricting all travel and transitioning 100 % of our workforce to be remote . in addition , in response to the uncertain macroeconomic environment , we converted all of our marketable securities to cash and cash equivalents , and as of january 31 , 2021 , all of our investments were classified as cash . 57 we continue to conduct business as usual with modifications to employee travel , employee work locations , customer interactions , and cancellation of certain marketing events , among other things . we will continue to actively monitor the situation and may take further actions that alter our business operations as may be required by federal , state , or local authorities , or that we determine are in the best interests of our employees , customers , partners , suppliers , and stockholders . the extent to which the covid-19 pandemic may impact our longer-term operational and financial performance remains uncertain . furthermore , due to our subscription-based business model , the effect of the covid-19 pandemic may not be fully reflected in our results of operations until future periods , if at all . the extent of the impact of the covid-19 pandemic will depend on several factors , including the pace of reopening the economy around the world ; the possible resurgence in the spread of the virus ; the development cycle of therapeutics and vaccines ; the impact on our customers and our sales cycles ; the impact on our customer , employee , and industry events ; and the effect on our vendors . please see part i , item 1a , “ risk factors ” in this annual report on form 10-k for a further description of the material risks we currently face , including risks related to the covid-19 pandemic . in march 2020 , we launched two initiatives to help our customers quickly onboard new remote workers without sacrificing protection or having to worry about a procurement cycle . this included a surge relief plan that allows our customers to surge the number of endpoints for a limited time . additionally , we launched a falcon prevent for home use program that allows our customers ' company administrators to install falcon prevent on their employees ' home systems . we believe both of these initiatives have been well received by our customers . on september 30 , 2020 , we acquired preempt security , a privately-held delaware corporation that developed real-time access control and threat prevention technology ( the “ acquisition ” ) . the total consideration transferred was $ 91.2 million which consisted of $ 87.4 million in cash and $ 3.8 million representing the fair value of replacement equity awards attributable to pre-acquisition service . the purchase price was allocated , on a preliminary basis , to identified intangible assets , which include developed technology , customer relationships and trade names , of $ 16.4 million , net tangible assets acquired of $ ( 0.5 ) million and goodwill of $ 75.3 million , representing the excess of the purchase price over the fair value of net tangible and intangible assets acquired . with this acquisition , we plan to offer customers enhanced zero trust security capabilities and strengthen our falcon platform with conditional access technology . the addition of preempt security 's technology to the falcon platform will help customers achieve end-to-end visibility and enforcement on identity data . on january 4 , 2021 , we amended and restated our existing credit agreement ( the “ a & r credit agreement ” and the facility thereunder the “ revolving facility ” ) among crowdstrike , inc. , as borrower , crowdstrike holdings , inc. , as guarantor , and silicon valley bank and the other lenders party thereto , providing us with a revolving line of credit of up to $ 750.0 million , including a letter of credit sub-facility in the aggregate amount of $ 100.0 million , and a swingline sub-facility in the aggregate amount of $ 50.0 million . we also have the option to request an incremental facility of up to an additional $ 250.0 million from one or more of the lenders under the a & r credit agreement . the a & r credit agreement is guaranteed by all of our material domestic subsidiaries . the maturity date under the a & r credit agreement is january 2 , 2026. on january 20 , 2021 , we issued and sold $ 750.0 million aggregate principal amount of 3.000 % senior notes due 2029 ( the “ senior notes ” ) . the senior notes are guaranteed by one of our subsidiaries , crowdstrike , inc. , as of the closing date , and thereafter will be guaranteed by any of our domestic subsidiaries that become borrowers or guarantors under our senior secured revolving credit facility . the senior notes and the guarantee are general unsecured senior obligations and rank equal in right of payment to all of our existing and future senior indebtedness . interest will be payable semi-annually at a rate of 3.000 % per year . story_separator_special_tag 62 interest expense : interest expense consists primarily of interest expense on our secured revolving credit facility , interest expense from amortization of debt issuance costs , and contractual interest expense for our senior notes issued in january 2021. we expect interest expense to be higher in fiscal 2022 as a result of the issuance of our senior notes . other income ( expense ) , net . other income ( expense ) , net , consists primarily of income earned on our cash equivalents and marketable securities ; expense related to the fair value of warrants for our redeemable convertible preferred stock and foreign currency transaction gains and losses . provision for income taxes . provision for income taxes consists of federal and state income taxes in the united states and income taxes and withholding taxes related to customer payments in certain foreign jurisdictions in which we conduct business . we maintain a full valuation allowance on our u.s. federal and state and uk deferred tax assets that we have determined are not realizable on a more likely than not basis . results of operations the following tables set forth our consolidated statements of operations in dollar amounts and as a percentage of total revenue for each period presented : replace_table_token_11_th ( 1 ) includes stock-based compensation expense as follows : replace_table_token_12_th 63 ( 2 ) includes amortization of acquired intangible assets as follows : replace_table_token_13_th ( 3 ) includes acquisition-related expenses as follows : year ended january , 31 2021 2020 2019 ( in thousands ) general and administrative $ 3,758 $ — $ — total acquisition-related expenses $ 3,758 $ — $ — ( 4 ) includes amortization of debt issuance costs and discount as follows : replace_table_token_14_th the following table presents the components of our consolidated statements of operations as a percentage of total revenue for the periods presented : replace_table_token_15_th 64 comparison of fiscal 2021 and fiscal 2020 revenue the following shows total revenue from subscriptions and professional services for fiscal 2021 , as compared to fiscal 2020 : replace_table_token_16_th total revenue increased by $ 393.0 million , or 82 % , in fiscal 2021 , compared to fiscal 2020. subscription revenue accounted for 92 % of our total revenue in fiscal 2021 , and 91 % in fiscal 2020. professional services revenue accounted for 8 % of our total revenue in fiscal 2021 and 9 % in fiscal 2020. subscription revenue increased by $ 368.3 million , or 84 % , in fiscal 2021 , compared to fiscal 2020. this increase was primarily attributable to the addition of new subscription customers , as we increased our customer base by 82 % , fro m 5,431 subscription customers in fiscal 2020 to 9,896 subscription customers in fiscal 2021. s ubscription revenue from new customers , subscription revenue from the renewal of existing customers , and subscription revenue from the sale of additional endpoints and additional modules to existing customers accounted for 33 % , 36 % , and 31 % of total subscription revenue in fiscal 2021 , respectively . subscription revenue from new customers , subscription revenue from the renewal of existing customers , and subscription revenue from the sale of additional endpoints and additional modules to existing customers accounted for 40 % , 33 % , and 27 % of total subscription revenue in fiscal 2020 , respectively . professional services revenue increased by $ 24.7 million , or 55 % , in fiscal 2021 , compared to fiscal 2020 , and was primarily attributable to an increase in the number of professional service hours performed . the following shows cost of revenue related to subscriptions and professional services for fiscal 2021 , as compared to fiscal 2020 : replace_table_token_17_th total cost of revenue increased by $ 87.9 million , or 62 % , in fiscal 2021 , compared to fiscal 2020. subscription cost of revenue increased by $ 72.7 million , or 65 % , in fiscal 2021 , compared to fiscal 2020. the increase in subscription cost of revenue was primarily due to an increase in employee-related expenses of $ 27.6 million driven by a 74 % increase in average headcount , an increase in cloud hosting and related services of $ 23.3 million driven by increased customer activity , an increase in depreciation of data center equipment of $ 7.8 million , an increase in stock-based compensation expense of $ 6.5 million , an increase in allocated overhead costs of $ 4.1 million , an increase in the amortization of internal use software of $ 1.6 million , and an increase in employee health insurance expense of $ 1.4 million , partially offset by a $ 1.2 million decrease in travel related costs due to the fact that , as a result of the covid-19 pandemic , a majority of our workforce was working remotely and incurred limited travel costs during fiscal 2021. professional services cost of revenue increased by $ 15.2 million , or 52 % , in fiscal 2021 , compared to fiscal 2020. the increase in professional services cost of revenue was primarily due to an increase in employee-related expenses of $ 11.4 million driven by an increase in average headcount of 47 % and an increase in stock-based compensation expense of $ 3.5 million , partially offset by a $ 1.1 million decrease in travel related costs due to the fact that , as a result of the covid-19 pandemic , a majority of our workforce was working remotely and incurred limited travel costs during fiscal 2021 . 65 the following shows gross profit and gross margin for subscriptions and professional services for fiscal 2021 , as compared to fiscal 2020. replace_table_token_18_th replace_table_token_19_th subscription gross margin increased by 3 % , in fiscal 2021 , compared to fiscal 2020. this increase was a result of continuing to shift more of our operations from third-party cloud service providers to colocation data centers , renegotiating the terms of

cash flows the following table summarizes our cash flows for the periods presented : replace_table_token_36_th operating activities net cash provided by operating activities during fiscal 2021 was $ 356.6 million , which resulted from a net loss of $ 92.6 million , adjusted for non-cash charges of $ 263.6 million and net cash inflow of $ 185.6 million from changes in operating assets and liabilities . non-cash charges primarily consisted of $ 149.7 million in stock-based compensation expense , $ 66.4 million of amortization of deferred contract acquisition costs , $ 38.7 million of depreciation and amortization , and $ 7.8 million of non-cash operating lease costs . the net cash inflow from changes in operating assets and liabilities was primarily due to a $ 338.8 million increase in deferred revenue , a $ 33.2 million increase in accrued payroll and benefits , a $ 23.8 million increase in accrued expenses and other current liabilities and a $ 11.3 million increase in accounts payable , partially offset by $ 151.0 million increase in deferred contract acquisition costs and a $ 72.5 million increase in accounts receivable . 77 net cash provided by operating activities during fiscal 2020 was $ 99.9 million , which resulted from a net loss of $ 141.8 million , adjusted for non-cash charges of $ 144.3 million and net cash inflow of $ 97.5 million from changes in operating assets and liabilities . non-cash charges primarily consisted of $ 79.9 million in stock-based compensation expense , $ 35.5 million of amortization of deferred contract acquisition costs , $ 23.0 million of depreciation and amortization , and $ 6.0 million due to the change in the fair value of our redeemable convertible preferred stock warrant liability . the net cash inflow from changes in operating assets and liabilities was primarily due to a $ 280.8 million increase in deferred revenue and $ 17.5 million increase in accrued payroll and benefits , partially offset by a $ 86.6 million increase in deferred contract acquisition costs , $ 73.1 million increase in accounts receivable and a $ 43.5 million increase in prepaid expenses and other assets .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```cash flows the following table summarizes our cash flows for the periods presented : replace_table_token_36_th operating activities net cash provided by operating activities during fiscal 2021 was $ 356.6 million , which resulted from a net loss of $ 92.6 million , adjusted for non-cash charges of $ 263.6 million and net cash inflow of $ 185.6 million from changes in operating assets and liabilities . non-cash charges primarily consisted of $ 149.7 million in stock-based compensation expense , $ 66.4 million of amortization of deferred contract acquisition costs , $ 38.7 million of depreciation and amortization , and $ 7.8 million of non-cash operating lease costs . the net cash inflow from changes in operating assets and liabilities was primarily due to a $ 338.8 million increase in deferred revenue , a $ 33.2 million increase in accrued payroll and benefits , a $ 23.8 million increase in accrued expenses and other current liabilities and a $ 11.3 million increase in accounts payable , partially offset by $ 151.0 million increase in deferred contract acquisition costs and a $ 72.5 million increase in accounts receivable . 77 net cash provided by operating activities during fiscal 2020 was $ 99.9 million , which resulted from a net loss of $ 141.8 million , adjusted for non-cash charges of $ 144.3 million and net cash inflow of $ 97.5 million from changes in operating assets and liabilities . non-cash charges primarily consisted of $ 79.9 million in stock-based compensation expense , $ 35.5 million of amortization of deferred contract acquisition costs , $ 23.0 million of depreciation and amortization , and $ 6.0 million due to the change in the fair value of our redeemable convertible preferred stock warrant liability . the net cash inflow from changes in operating assets and liabilities was primarily due to a $ 280.8 million increase in deferred revenue and $ 17.5 million increase in accrued payroll and benefits , partially offset by a $ 86.6 million increase in deferred contract acquisition costs , $ 73.1 million increase in accounts receivable and a $ 43.5 million increase in prepaid expenses and other assets . ``` Suspicious Activity Report : in march 2020 , the world health organization declared the covid-19 outbreak to be a pandemic . since then , the covid-19 pandemic has rapidly spread across the globe and has already resulted in significant volatility , uncertainty , and economic disruption . thus far , the impact of the pandemic has been modest with some customers , particularly in heavily impacted industries , requesting special billing or payment terms . our gross retention rate for the fourth quarter of fiscal 2021 remained consistently high and our dollar-based net retention rate once again exceeded 120 percent as we continued to expand module adoption within new and existing customers . in march 2020 , we implemented several measures to help protect the health and safety of our employees around the globe including restricting all travel and transitioning 100 % of our workforce to be remote . in addition , in response to the uncertain macroeconomic environment , we converted all of our marketable securities to cash and cash equivalents , and as of january 31 , 2021 , all of our investments were classified as cash . 57 we continue to conduct business as usual with modifications to employee travel , employee work locations , customer interactions , and cancellation of certain marketing events , among other things . we will continue to actively monitor the situation and may take further actions that alter our business operations as may be required by federal , state , or local authorities , or that we determine are in the best interests of our employees , customers , partners , suppliers , and stockholders . the extent to which the covid-19 pandemic may impact our longer-term operational and financial performance remains uncertain . furthermore , due to our subscription-based business model , the effect of the covid-19 pandemic may not be fully reflected in our results of operations until future periods , if at all . the extent of the impact of the covid-19 pandemic will depend on several factors , including the pace of reopening the economy around the world ; the possible resurgence in the spread of the virus ; the development cycle of therapeutics and vaccines ; the impact on our customers and our sales cycles ; the impact on our customer , employee , and industry events ; and the effect on our vendors . please see part i , item 1a , “ risk factors ” in this annual report on form 10-k for a further description of the material risks we currently face , including risks related to the covid-19 pandemic . in march 2020 , we launched two initiatives to help our customers quickly onboard new remote workers without sacrificing protection or having to worry about a procurement cycle . this included a surge relief plan that allows our customers to surge the number of endpoints for a limited time . additionally , we launched a falcon prevent for home use program that allows our customers ' company administrators to install falcon prevent on their employees ' home systems . we believe both of these initiatives have been well received by our customers . on september 30 , 2020 , we acquired preempt security , a privately-held delaware corporation that developed real-time access control and threat prevention technology ( the “ acquisition ” ) . the total consideration transferred was $ 91.2 million which consisted of $ 87.4 million in cash and $ 3.8 million representing the fair value of replacement equity awards attributable to pre-acquisition service . the purchase price was allocated , on a preliminary basis , to identified intangible assets , which include developed technology , customer relationships and trade names , of $ 16.4 million , net tangible assets acquired of $ ( 0.5 ) million and goodwill of $ 75.3 million , representing the excess of the purchase price over the fair value of net tangible and intangible assets acquired . with this acquisition , we plan to offer customers enhanced zero trust security capabilities and strengthen our falcon platform with conditional access technology . the addition of preempt security 's technology to the falcon platform will help customers achieve end-to-end visibility and enforcement on identity data . on january 4 , 2021 , we amended and restated our existing credit agreement ( the “ a & r credit agreement ” and the facility thereunder the “ revolving facility ” ) among crowdstrike , inc. , as borrower , crowdstrike holdings , inc. , as guarantor , and silicon valley bank and the other lenders party thereto , providing us with a revolving line of credit of up to $ 750.0 million , including a letter of credit sub-facility in the aggregate amount of $ 100.0 million , and a swingline sub-facility in the aggregate amount of $ 50.0 million . we also have the option to request an incremental facility of up to an additional $ 250.0 million from one or more of the lenders under the a & r credit agreement . the a & r credit agreement is guaranteed by all of our material domestic subsidiaries . the maturity date under the a & r credit agreement is january 2 , 2026. on january 20 , 2021 , we issued and sold $ 750.0 million aggregate principal amount of 3.000 % senior notes due 2029 ( the “ senior notes ” ) . the senior notes are guaranteed by one of our subsidiaries , crowdstrike , inc. , as of the closing date , and thereafter will be guaranteed by any of our domestic subsidiaries that become borrowers or guarantors under our senior secured revolving credit facility . the senior notes and the guarantee are general unsecured senior obligations and rank equal in right of payment to all of our existing and future senior indebtedness . interest will be payable semi-annually at a rate of 3.000 % per year . story_separator_special_tag 62 interest expense : interest expense consists primarily of interest expense on our secured revolving credit facility , interest expense from amortization of debt issuance costs , and contractual interest expense for our senior notes issued in january 2021. we expect interest expense to be higher in fiscal 2022 as a result of the issuance of our senior notes . other income ( expense ) , net . other income ( expense ) , net , consists primarily of income earned on our cash equivalents and marketable securities ; expense related to the fair value of warrants for our redeemable convertible preferred stock and foreign currency transaction gains and losses . provision for income taxes . provision for income taxes consists of federal and state income taxes in the united states and income taxes and withholding taxes related to customer payments in certain foreign jurisdictions in which we conduct business . we maintain a full valuation allowance on our u.s. federal and state and uk deferred tax assets that we have determined are not realizable on a more likely than not basis . results of operations the following tables set forth our consolidated statements of operations in dollar amounts and as a percentage of total revenue for each period presented : replace_table_token_11_th ( 1 ) includes stock-based compensation expense as follows : replace_table_token_12_th 63 ( 2 ) includes amortization of acquired intangible assets as follows : replace_table_token_13_th ( 3 ) includes acquisition-related expenses as follows : year ended january , 31 2021 2020 2019 ( in thousands ) general and administrative $ 3,758 $ — $ — total acquisition-related expenses $ 3,758 $ — $ — ( 4 ) includes amortization of debt issuance costs and discount as follows : replace_table_token_14_th the following table presents the components of our consolidated statements of operations as a percentage of total revenue for the periods presented : replace_table_token_15_th 64 comparison of fiscal 2021 and fiscal 2020 revenue the following shows total revenue from subscriptions and professional services for fiscal 2021 , as compared to fiscal 2020 : replace_table_token_16_th total revenue increased by $ 393.0 million , or 82 % , in fiscal 2021 , compared to fiscal 2020. subscription revenue accounted for 92 % of our total revenue in fiscal 2021 , and 91 % in fiscal 2020. professional services revenue accounted for 8 % of our total revenue in fiscal 2021 and 9 % in fiscal 2020. subscription revenue increased by $ 368.3 million , or 84 % , in fiscal 2021 , compared to fiscal 2020. this increase was primarily attributable to the addition of new subscription customers , as we increased our customer base by 82 % , fro m 5,431 subscription customers in fiscal 2020 to 9,896 subscription customers in fiscal 2021. s ubscription revenue from new customers , subscription revenue from the renewal of existing customers , and subscription revenue from the sale of additional endpoints and additional modules to existing customers accounted for 33 % , 36 % , and 31 % of total subscription revenue in fiscal 2021 , respectively . subscription revenue from new customers , subscription revenue from the renewal of existing customers , and subscription revenue from the sale of additional endpoints and additional modules to existing customers accounted for 40 % , 33 % , and 27 % of total subscription revenue in fiscal 2020 , respectively . professional services revenue increased by $ 24.7 million , or 55 % , in fiscal 2021 , compared to fiscal 2020 , and was primarily attributable to an increase in the number of professional service hours performed . the following shows cost of revenue related to subscriptions and professional services for fiscal 2021 , as compared to fiscal 2020 : replace_table_token_17_th total cost of revenue increased by $ 87.9 million , or 62 % , in fiscal 2021 , compared to fiscal 2020. subscription cost of revenue increased by $ 72.7 million , or 65 % , in fiscal 2021 , compared to fiscal 2020. the increase in subscription cost of revenue was primarily due to an increase in employee-related expenses of $ 27.6 million driven by a 74 % increase in average headcount , an increase in cloud hosting and related services of $ 23.3 million driven by increased customer activity , an increase in depreciation of data center equipment of $ 7.8 million , an increase in stock-based compensation expense of $ 6.5 million , an increase in allocated overhead costs of $ 4.1 million , an increase in the amortization of internal use software of $ 1.6 million , and an increase in employee health insurance expense of $ 1.4 million , partially offset by a $ 1.2 million decrease in travel related costs due to the fact that , as a result of the covid-19 pandemic , a majority of our workforce was working remotely and incurred limited travel costs during fiscal 2021. professional services cost of revenue increased by $ 15.2 million , or 52 % , in fiscal 2021 , compared to fiscal 2020. the increase in professional services cost of revenue was primarily due to an increase in employee-related expenses of $ 11.4 million driven by an increase in average headcount of 47 % and an increase in stock-based compensation expense of $ 3.5 million , partially offset by a $ 1.1 million decrease in travel related costs due to the fact that , as a result of the covid-19 pandemic , a majority of our workforce was working remotely and incurred limited travel costs during fiscal 2021 . 65 the following shows gross profit and gross margin for subscriptions and professional services for fiscal 2021 , as compared to fiscal 2020. replace_table_token_18_th replace_table_token_19_th subscription gross margin increased by 3 % , in fiscal 2021 , compared to fiscal 2020. this increase was a result of continuing to shift more of our operations from third-party cloud service providers to colocation data centers , renegotiating the terms of

financial information related to our business segments can be found in note 16 - segment information of our financial statements included elsewhere in this 10-k. 42 back to top acquisitions in march 2019 , we acquired vpi quality windows , inc. , a leading manufacturer of vinyl windows , specializing in customized solutions for mid-rise multi-family , industrial , hospitality and commercial projects , primarily in the western u.s. vpi is located in spokane , washington . vpi is part of our north america segment . we paid $ 57.8 million in cash , net of cash acquired , for the acquisition of vpi . in april 2018 , we acquired the assets of d & k , a long-standing supplier of cavity sliders to our corinthian doors business . d & k is part of our australasia segment . in march 2018 , we acquired the remaining issued and outstanding shares and membership interests of abs , headquartered in sacramento , california . abs is a premier supplier of value-added services for the millwork industry . abs is part of our north america segment . in february 2018 , we acquired a & l , a leading australian manufacturer of residential aluminum windows and patio doors . a & l has a network of manufacturing facilities across the eastern seaboard of australia , which we expect will deliver synergies through operational savings from the implementation of jem and by leveraging the benefits of our combined supply chain . a & l is part of our australasia segment . in february 2018 , we acquired domoferm , headquartered in gänserndorf , austria . domoferm is a leading european provider of steel doors , steel door frames , and fire doors for commercial and residential markets with four manufacturing sites in austria , germany , and the czech republic . domoferm is part of our europe segment . we paid an aggregate of approximately $ 229.2 million in cash , including contingent consideration , ( net of cash acquired ) for the 2019 and 2018 acquisitions . in addition , we assumed no debt in our 2019 acquisition and we assumed debt of approximately $ 70.6 million associated with our 2018 acquired companies . for additional information on our acquisition activity , see note 2 - acquisitions of our financial statements included elsewhere in this 10-k. factors and trends affecting our business components of net revenues the key components of our net revenues include core net revenues ( which we define to include the impact of pricing and volume/mix , as discussed further under the heading , “ product pricing and volume/mix ” below ) , contribution from acquisitions made within the prior twelve months , and the impact of foreign exchange . core net revenues reported in our financial statements are impacted by the fluctuating currency values in the geographies in which we operate , which we refer to as the impact of foreign exchange . throughout this “ management 's discussion and analysis of financial condition and results of operations ” , percentage changes in pricing are based on management schedules and are not derived directly from our accounting records . product demand general business , financial market , and economic conditions globally and in the regions where we operate influence overall demand in our end markets and for our products . in particular , the following factors may have a direct impact on demand for our products in the countries and regions where our products are marketed and sold : the strength of the economy ; employment rates and consumer confidence and spending rates ; the availability and cost of credit ; the amount and type of residential and non-residential construction ; housing sales and home values ; the age of existing home stock , home vacancy rates , and foreclosures ; interest rate fluctuations for our customers and consumers ; increases in the cost of raw materials or any shortage in supplies or labor ; the effects of governmental regulation and initiatives to manage economic conditions ; geographical shifts in population and other changes in demographics ; and changes in weather patterns . 43 back to top in addition , we seek to drive demand for our products through the implementation of various strategies and initiatives . we believe we can enhance demand for our new and existing products by : innovating and developing new products and technologies ; investing in branding and marketing strategies , including marketing campaigns in both print and social media , as well as our investments in training centers and mobile training facilities ; and implementing channel initiatives to enhance our relationships with key channel partners and customers , including the true blu dealer management program in north america . product pricing and volume/mix the price and mix of products that we sell are important drivers of our net revenues and net income . under the heading “ results of operations , ” references to ( i ) “ pricing ” refer to the impact of price increases or decreases , as applicable , for particular products between periods and ( ii ) “ volume/mix ” refer to the combined impact of both the number of products we sell in a particular period and the types of products sold , in each case , on net revenues . while we operate in competitive markets , pricing discipline is an important element of our strategy to achieve profitable growth through improved margins . our strategy also includes incentivizing our channel partners to sell our higher margin products , and we believe a renewed focus on innovation and the development of new technologies will increase our sales volumes and the overall profitability of our product mix . story_separator_special_tag during the second and third quarters of 2020 , we experienced intermittent closures of certain manufacturing facilities due to local and governmental mandates , with disruptions occurring primarily in april and may . customer demand and revenue were consistent with our expectations during april and may with high-teens percentage declines from the prior year , however , they improved through the last half of the second quarter and continued to improve throughout the second half of 2020. we have modified our manufacturing facilities and procedures , based on recommended public health guidelines , to ensure the health and well-being of our employees . during 2020 , we recognized approximately $ 7.4 million relating to governmental pandemic assistance programs , which are primarily related to reimbursements for additional costs incurred as a result of the outbreak of covid-19 . we have continued to monitor our liquidity throughout 2020 and increased liquidity compared to the prior year , primarily as a result of issuing $ 250.0 million of senior secured notes during the second quarter , adding additional collateral to increase our borrowing base and availability under the abl facility , and the impact of cost savings measures . we have taken measures to reduce discretionary spending including , for example , restricted travel , implemented hiring freezes for non-essential positions , delayed merit increases , and suspended all non-critical spending , such as marketing and discretionary projects . in addition , during the second quarter , we implemented actions to reduce salary costs globally , including our executive leadership team and board of directors elected to reduce their second quarter compensation by 25 % , and implemented short-term employee furloughs throughout our company . during the third and fourth quarters , we reversed certain salary cost cutting initiatives to those negatively impacted . further , to maintain sufficient levels of cash and liquidity , we are deferring tax payments where permitted through covid-19 related government subsidy programs and are actively monitoring our accounts receivable for customers with elevated credit risk . we are monitoring the situation closely and , if necessary , will relax cost saving measures or implement additional measures as appropriate . 47 back to top the scope and nature of impacts from covid-19 , most of which are beyond our control , continue to evolve , and the outcome is uncertain . the ultimate effects of the covid-19 pandemic on us and the end markets we service , is highly uncertain and will depend on future developments . such effects could exist for an extended period even after the pandemic ends . results of operations the tables in this section summarize key components of our results of operations for the periods indicated , both in u.s. dollars and as a percentage of our net revenues . certain percentages presented in this section have been rounded to the nearest whole number . accordingly , totals may not equal the sum of the line items in the tables below . comparison of the year ended december 31 , 2020 to the year ended december 31 , 2019 replace_table_token_2_th consolidated results net revenues – net revenues decreased $ 54.1 million , or 1.3 % , to $ 4,235.7 million in the year ended december 31 , 2020 from $ 4,289.8 million in the year ended december 31 , 2019. the decrease was driven by a decline in core revenue of 2 % consisting of a 5 % decline in volume/mix , partially offset by a 3 % pricing benefit . gross margin – gross margin increased $ 29.4 million , or 3.4 % , to $ 901.9 million in the year ended december 31 , 2020 from $ 872.5 million in the year ended december 31 , 2019. gross margin as a percentage of net revenues was 21.3 % in the year ended december 31 , 2020 and 20.3 % in the year ended december 31 , 2019. gross margins increased due to sourcing savings and improved pricing , partially offset by unfavorable volume/mix and the effect of inflation on labor compensation . sg & a expense – sg & a expense increased $ 42.1 million , or 6.4 % , to $ 702.7 million in the year ended december 31 , 2020 from $ 660.6 million in the year ended december 31 , 2019. the increase in sg & a expense was primarily due to increased legal expenses , primarily relating to litigation and environmental accruals and fees , and estimated variable compensation , partially offset by reductions in spending relating to sales , marketing and travel as a result of cost saving measures implemented in response to covid-19 , and the non-recurrence of aquisition costs recorded in 2019. impairment and restructuring charges – impairment and restructuring charges decreased $ 11.1 million , or 51.4 % , to $ 10.5 million in the year ended december 31 , 2020 from $ 21.6 million in the year ended december 31 , 2019. charges incurred in 2020 primarily related to severance charges for ongoing restructuring projects across all segments as well as impairment charges primarily related to capitalized costs of certain erp modules due to delays in implementation and uncertainty of their future use . charges incurred in 2019 primarily related to plant consolidations in our north america and australasia segments resulting in impairments of rou assets and property and equipment as well as severance costs across all segments and corporate . for more information , refer to note 20 - impairment and restructuring charges to our consolidated financial statements included in this 10-k. interest expense , net – interest expense , net , increased $ 3.0 million , or 4.2 % , to $ 74.8 million in the year ended december 31 , 2020 from $ 71.8 million in the year ended december 31 , 2019. the increase was primarily due to interest on our senior secured notes issued in may 2020 , partially offset by reduced borrowings and interest rates

cash flow from operations net cash provided by operating activities increased $ 52.9 million to $ 355.7 million in the year ended december 31 , 2020 from $ 302.7 million in the year ended december 31 , 2019. the increase in cash provided by operating activities was due primarily to increases in accruals for the deferral of payroll taxes , including $ 20.9 million as a result of the cares act , which will be paid equally over the subsequent two years , legal and environmental matters , and estimated variable compensation . net cash provided by operating activities increased $ 83.1 million to $ 302.7 million in the year ended december 31 , 2019 from $ 219.7 million in the year ended december 31 , 2018. the increase in cash provided by operating activities was due primarily to improvement in working capital as a result of optimization of vendor payment terms , lower inventory balances due to reduced core revenue volumes , and reduced cash taxes . cash flow from investing activities net cash used in investing activities decreased $ 102.9 million to $ 82.0 million in the year ended december 31 , 2020 from $ 184.9 million in the year ended december 31 , 2019 primarily due to a decrease in the cash used for acquisitions and a reduction in capital expenditures . net cash used in investing activities decreased $ 99.2 million to $ 184.9 million in the year ended december 31 , 2019 from $ 284.1 million in the year ended december 31 , 2018. the decrease was primarily due to a decrease in cash used for acquisitions .

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.

Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text. ```cash flow from operations net cash provided by operating activities increased $ 52.9 million to $ 355.7 million in the year ended december 31 , 2020 from $ 302.7 million in the year ended december 31 , 2019. the increase in cash provided by operating activities was due primarily to increases in accruals for the deferral of payroll taxes , including $ 20.9 million as a result of the cares act , which will be paid equally over the subsequent two years , legal and environmental matters , and estimated variable compensation . net cash provided by operating activities increased $ 83.1 million to $ 302.7 million in the year ended december 31 , 2019 from $ 219.7 million in the year ended december 31 , 2018. the increase in cash provided by operating activities was due primarily to improvement in working capital as a result of optimization of vendor payment terms , lower inventory balances due to reduced core revenue volumes , and reduced cash taxes . cash flow from investing activities net cash used in investing activities decreased $ 102.9 million to $ 82.0 million in the year ended december 31 , 2020 from $ 184.9 million in the year ended december 31 , 2019 primarily due to a decrease in the cash used for acquisitions and a reduction in capital expenditures . net cash used in investing activities decreased $ 99.2 million to $ 184.9 million in the year ended december 31 , 2019 from $ 284.1 million in the year ended december 31 , 2018. the decrease was primarily due to a decrease in cash used for acquisitions . ``` Suspicious Activity Report : financial information related to our business segments can be found in note 16 - segment information of our financial statements included elsewhere in this 10-k. 42 back to top acquisitions in march 2019 , we acquired vpi quality windows , inc. , a leading manufacturer of vinyl windows , specializing in customized solutions for mid-rise multi-family , industrial , hospitality and commercial projects , primarily in the western u.s. vpi is located in spokane , washington . vpi is part of our north america segment . we paid $ 57.8 million in cash , net of cash acquired , for the acquisition of vpi . in april 2018 , we acquired the assets of d & k , a long-standing supplier of cavity sliders to our corinthian doors business . d & k is part of our australasia segment . in march 2018 , we acquired the remaining issued and outstanding shares and membership interests of abs , headquartered in sacramento , california . abs is a premier supplier of value-added services for the millwork industry . abs is part of our north america segment . in february 2018 , we acquired a & l , a leading australian manufacturer of residential aluminum windows and patio doors . a & l has a network of manufacturing facilities across the eastern seaboard of australia , which we expect will deliver synergies through operational savings from the implementation of jem and by leveraging the benefits of our combined supply chain . a & l is part of our australasia segment . in february 2018 , we acquired domoferm , headquartered in gänserndorf , austria . domoferm is a leading european provider of steel doors , steel door frames , and fire doors for commercial and residential markets with four manufacturing sites in austria , germany , and the czech republic . domoferm is part of our europe segment . we paid an aggregate of approximately $ 229.2 million in cash , including contingent consideration , ( net of cash acquired ) for the 2019 and 2018 acquisitions . in addition , we assumed no debt in our 2019 acquisition and we assumed debt of approximately $ 70.6 million associated with our 2018 acquired companies . for additional information on our acquisition activity , see note 2 - acquisitions of our financial statements included elsewhere in this 10-k. factors and trends affecting our business components of net revenues the key components of our net revenues include core net revenues ( which we define to include the impact of pricing and volume/mix , as discussed further under the heading , “ product pricing and volume/mix ” below ) , contribution from acquisitions made within the prior twelve months , and the impact of foreign exchange . core net revenues reported in our financial statements are impacted by the fluctuating currency values in the geographies in which we operate , which we refer to as the impact of foreign exchange . throughout this “ management 's discussion and analysis of financial condition and results of operations ” , percentage changes in pricing are based on management schedules and are not derived directly from our accounting records . product demand general business , financial market , and economic conditions globally and in the regions where we operate influence overall demand in our end markets and for our products . in particular , the following factors may have a direct impact on demand for our products in the countries and regions where our products are marketed and sold : the strength of the economy ; employment rates and consumer confidence and spending rates ; the availability and cost of credit ; the amount and type of residential and non-residential construction ; housing sales and home values ; the age of existing home stock , home vacancy rates , and foreclosures ; interest rate fluctuations for our customers and consumers ; increases in the cost of raw materials or any shortage in supplies or labor ; the effects of governmental regulation and initiatives to manage economic conditions ; geographical shifts in population and other changes in demographics ; and changes in weather patterns . 43 back to top in addition , we seek to drive demand for our products through the implementation of various strategies and initiatives . we believe we can enhance demand for our new and existing products by : innovating and developing new products and technologies ; investing in branding and marketing strategies , including marketing campaigns in both print and social media , as well as our investments in training centers and mobile training facilities ; and implementing channel initiatives to enhance our relationships with key channel partners and customers , including the true blu dealer management program in north america . product pricing and volume/mix the price and mix of products that we sell are important drivers of our net revenues and net income . under the heading “ results of operations , ” references to ( i ) “ pricing ” refer to the impact of price increases or decreases , as applicable , for particular products between periods and ( ii ) “ volume/mix ” refer to the combined impact of both the number of products we sell in a particular period and the types of products sold , in each case , on net revenues . while we operate in competitive markets , pricing discipline is an important element of our strategy to achieve profitable growth through improved margins . our strategy also includes incentivizing our channel partners to sell our higher margin products , and we believe a renewed focus on innovation and the development of new technologies will increase our sales volumes and the overall profitability of our product mix . story_separator_special_tag during the second and third quarters of 2020 , we experienced intermittent closures of certain manufacturing facilities due to local and governmental mandates , with disruptions occurring primarily in april and may . customer demand and revenue were consistent with our expectations during april and may with high-teens percentage declines from the prior year , however , they improved through the last half of the second quarter and continued to improve throughout the second half of 2020. we have modified our manufacturing facilities and procedures , based on recommended public health guidelines , to ensure the health and well-being of our employees . during 2020 , we recognized approximately $ 7.4 million relating to governmental pandemic assistance programs , which are primarily related to reimbursements for additional costs incurred as a result of the outbreak of covid-19 . we have continued to monitor our liquidity throughout 2020 and increased liquidity compared to the prior year , primarily as a result of issuing $ 250.0 million of senior secured notes during the second quarter , adding additional collateral to increase our borrowing base and availability under the abl facility , and the impact of cost savings measures . we have taken measures to reduce discretionary spending including , for example , restricted travel , implemented hiring freezes for non-essential positions , delayed merit increases , and suspended all non-critical spending , such as marketing and discretionary projects . in addition , during the second quarter , we implemented actions to reduce salary costs globally , including our executive leadership team and board of directors elected to reduce their second quarter compensation by 25 % , and implemented short-term employee furloughs throughout our company . during the third and fourth quarters , we reversed certain salary cost cutting initiatives to those negatively impacted . further , to maintain sufficient levels of cash and liquidity , we are deferring tax payments where permitted through covid-19 related government subsidy programs and are actively monitoring our accounts receivable for customers with elevated credit risk . we are monitoring the situation closely and , if necessary , will relax cost saving measures or implement additional measures as appropriate . 47 back to top the scope and nature of impacts from covid-19 , most of which are beyond our control , continue to evolve , and the outcome is uncertain . the ultimate effects of the covid-19 pandemic on us and the end markets we service , is highly uncertain and will depend on future developments . such effects could exist for an extended period even after the pandemic ends . results of operations the tables in this section summarize key components of our results of operations for the periods indicated , both in u.s. dollars and as a percentage of our net revenues . certain percentages presented in this section have been rounded to the nearest whole number . accordingly , totals may not equal the sum of the line items in the tables below . comparison of the year ended december 31 , 2020 to the year ended december 31 , 2019 replace_table_token_2_th consolidated results net revenues – net revenues decreased $ 54.1 million , or 1.3 % , to $ 4,235.7 million in the year ended december 31 , 2020 from $ 4,289.8 million in the year ended december 31 , 2019. the decrease was driven by a decline in core revenue of 2 % consisting of a 5 % decline in volume/mix , partially offset by a 3 % pricing benefit . gross margin – gross margin increased $ 29.4 million , or 3.4 % , to $ 901.9 million in the year ended december 31 , 2020 from $ 872.5 million in the year ended december 31 , 2019. gross margin as a percentage of net revenues was 21.3 % in the year ended december 31 , 2020 and 20.3 % in the year ended december 31 , 2019. gross margins increased due to sourcing savings and improved pricing , partially offset by unfavorable volume/mix and the effect of inflation on labor compensation . sg & a expense – sg & a expense increased $ 42.1 million , or 6.4 % , to $ 702.7 million in the year ended december 31 , 2020 from $ 660.6 million in the year ended december 31 , 2019. the increase in sg & a expense was primarily due to increased legal expenses , primarily relating to litigation and environmental accruals and fees , and estimated variable compensation , partially offset by reductions in spending relating to sales , marketing and travel as a result of cost saving measures implemented in response to covid-19 , and the non-recurrence of aquisition costs recorded in 2019. impairment and restructuring charges – impairment and restructuring charges decreased $ 11.1 million , or 51.4 % , to $ 10.5 million in the year ended december 31 , 2020 from $ 21.6 million in the year ended december 31 , 2019. charges incurred in 2020 primarily related to severance charges for ongoing restructuring projects across all segments as well as impairment charges primarily related to capitalized costs of certain erp modules due to delays in implementation and uncertainty of their future use . charges incurred in 2019 primarily related to plant consolidations in our north america and australasia segments resulting in impairments of rou assets and property and equipment as well as severance costs across all segments and corporate . for more information , refer to note 20 - impairment and restructuring charges to our consolidated financial statements included in this 10-k. interest expense , net – interest expense , net , increased $ 3.0 million , or 4.2 % , to $ 74.8 million in the year ended december 31 , 2020 from $ 71.8 million in the year ended december 31 , 2019. the increase was primarily due to interest on our senior secured notes issued in may 2020 , partially offset by reduced borrowings and interest rates