CISCO ROYALTY AUDIT AND CONCENTRATION |
9 Months Ended |
|---|---|
Sep. 30, 2015 | |
| Notes to Financial Statements | |
| NOTE N - CISCO ROYALTY AUDIT AND CONCENTRATION |
In late December 2013, the Company exercised its right to audit the royalties paid to it by Cisco for the years 2012 and 2013 (the “Audit Period”) in accordance with its May 2011 license agreement with Cisco Systems, Inc. (“Cisco”). As a result of the audit, Cisco agreed to pay the Company additional royalty payments pursuant to the May 2011 license agreement of $3,281,000 for the Audit Period and other periods covered by the license agreement which was recorded as royalty revenue in the three month period ended June 30, 2014, at the time the Company completed the audit and additional royalty payments were agreed to by the parties.
Cisco constituted approximately 71 % and 89% of the Company’s revenue, respectively, for the nine month periods ended September 30, 2015 and September 30, 2014. Revenue from Cisco constituted approximately 40% and 72% of the Company’s revenue, respectively, for the three months periods ended September 30, 2015 and September 30, 2014. At September 30, 2015 and December 31, 2014, the royalty receivable from Cisco constituted approximately 70% and 74% of the Company’s royalty receivables, respectively. |