2.4.0.8006 - Disclosure - THE COMPANY AND SIGNIFICANT ACCOUNTING POLICIEStruefalsefalse1false falsefalseContext_6ME__30-Jun-2013http://www.sec.gov/CIK0001051114duration2013-01-01T00:00:002013-06-30T00:00:001true 1us-gaap_AccountingPoliciesAbstractus-gaap_truenadurationfalsefalsefalsefalsefalsefalsefalsefalse1falsefalsefalse00falsefalsefalsexbrli:stringItemTypestringfalse0Significant Accounting Policies [Abstract]2false 2us-gaap_SignificantAccountingPoliciesTextBlockus-gaap_truenadurationfalsefalsefalsefalsefalsefalsefalsefalseterseLabel1falsefalsefalse00<div align="justify" style="text-indent: 0pt; display: block; margin-left: 0pt; margin-right: 0pt;"> </div> <div align="center"> <table style="width: 100%; font-family: times new roman; font-size: 10pt;" border="0" cellspacing="0" cellpadding="0"> <tr valign="top"> <td style="width: 27pt;"> <div style="text-indent: 0pt; margin-left: 0pt; margin-right: 0pt;"><font style="display: inline; font-family: times new roman; font-size: 10pt;">1.</font></div> </td> <td> <div align="left"><font style="display: inline; font-family: times new roman; font-size: 10pt;"><font style="display: inline; font-weight: bold;">THE</font> <font style="display: inline; font-weight: bold;">COMPANY AND</font> <font style="display: inline; font-weight: bold;">SIGNIFICANT ACCOUNTING POLICIES</font></font></div> </td> </tr> </table> </div> <div align="justify" style="text-indent: 0pt; display: block; margin-left: 0pt; margin-right: 0pt;"> </div> <div style="text-align: justify; text-indent: 0pt; display: block; margin-left: 27pt; margin-right: 0pt;"><font style="display: inline; font-family: times new roman; font-size: 10pt;">Innotrac Corporation (“Innotrac” or the “Company”), founded in 1984 <font style="display: inline; font-size: 10pt;">and based near Atlanta, Georgia, is a best-in</font><font style="display: inline; font-family: times new roman; font-size: 10pt;">-</font><font style="display: inline; font-size: 10pt;">class commerce provider integrating digital technology, fulfillment, contact center and business intelligence solutions to support global brands.  Innotrac’s fulfillment, order management and contact center solutions are integrated with all major web platforms, and seamlessly integrate with any required partner technologies.  The Company employs sophisticated order processing and warehouse management technology and operates eight fulfillment centers and one call center spanning all time zones across the continental United States.  </font></font></div> <div style="text-align: justify; text-indent: 0pt; display: block; margin-left: 27pt; margin-right: 0pt;"> </div> <div style="text-align: justify; text-indent: 0pt; display: block; margin-left: 27pt; margin-right: 0pt;"><font style="display: inline; font-family: times new roman; font-size: 10pt;">The accounting policies followed for quarterly financial reporting are the same as those disclosed in the Notes to Financial Statements included in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission for the year ended December 31, 2012.  Certain of the Company’s more significant accounting policies are as follows:</font></div> <div style="text-align: justify; text-indent: 0pt; display: block; margin-left: 27pt; margin-right: 0pt;"> </div> <div style="text-align: justify; text-indent: 0pt; display: block; margin-left: 27pt; margin-right: 0pt;"><font style="display: inline; font-family: times new roman; font-size: 10pt;"><font style="font-style: italic; display: inline;">Principles of Consolidation.  </font>The financial statements have been prepared on the accrual basis of accounting in conformity with accounting principles generally accepted in the United States of America.  The consolidated financial statements include the accounts of the Company and its majority owned subsidiary.  On April 11, 2011 the Company completed the formation of Innotrac Europe GmbH (“Innotrac Europe”), a joint venture between Innotrac and PVS Fulfillment-Service GmbH (“PVS”) in Neckarsulm, Germany.  Innotrac has a 50.1% ownership stake in the joint venture.  All significant intercompany transactions and balances have been eliminated in consolidation.</font></div> <div style="text-align: justify; text-indent: 0pt; display: block; margin-left: 27pt; margin-right: 0pt;"> </div> <div style="text-align: justify; text-indent: 0pt; display: block; margin-left: 27pt; margin-right: 0pt;"><font style="display: inline; font-family: times new roman; font-size: 10pt;"><font style="font-style: italic; display: inline;">Accounting Estimates.  </font>The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.  Actual results could differ from those estimates.</font></div> <div style="text-align: justify; text-indent: 0pt; display: block; margin-left: 27pt; margin-right: 0pt;"> </div> <div style="text-align: justify; text-indent: 0pt; display: block; margin-left: 27pt; margin-right: 0pt;"><font style="display: inline; font-family: times new roman; font-size: 10pt;"><font style="font-style: italic; display: inline;">Accounting for Income Taxes.  </font>Innotrac utilizes the liability method of accounting for income taxes in accordance with Accounting Standards Codification (“ASC”) topic No. 740 – <font style="font-style: italic; display: inline;">Income Taxes</font>.  Under the liability method, deferred taxes are determined based on the difference between the financial and tax basis of assets and liabilities using enacted tax rates in effect in the years in which the differences are expected to reverse. A valuation allowance was recorded against the deferred tax asset as of June 30, 2013 and December 31, 2012 (see Note 4).</font></div> <div style="text-align: justify; text-indent: 0pt; display: block; margin-left: 27pt; margin-right: 0pt;"> </div> <div style="text-align: justify; text-indent: 0pt; display: block; margin-left: 27pt; margin-right: 0pt;"><font style="display: inline; font-family: times new roman; font-size: 10pt;"><font style="font-style: italic; display: inline;">Revenue Recognition.</font>  Innotrac derives its revenue primarily from three sources: (1) fulfillment operations (2) the delivery of call center services integrated with our fulfillment operations and (3) delivering technology solutions and integration services to its clients.  Innotrac’s fulfillment services operations record revenue at the conclusion of the material selection, packaging and upon completion of the shipping process.  The shipping process is considered complete after transfer to an independent freight carrier and receipt of a bill of lading or shipping manifest from that carrier.  Innotrac’s call center service revenue is recognized according to written pricing agreements based on the number of calls, minutes or hourly rates when those calls and time rated services occur.  All other revenues are recognized as services are rendered.  As required by the consensus reached in ASC topic No. 605 – <font style="font-style: italic; display: inline;">Revenue Recognition</font>, 1)  revenues have been recorded net of the cost of the goods for all fee-for-service clients and 2)  the Company records reimbursements received from customers for out-of pocket expenses, primarily freight and postage fees, as revenue and the associated expense as cost of revenue. The Company purchases product for two clients from vendors under agreements that require our clients to buy the product back from us at original cost when product is shipped to our client’s end consumer or after a period of time if <font style="display: inline; font-family: times new roman; font-size: 10pt;">the product has not been shipped from our fulfillment centers.  The value of these products is paid to Innotrac at the same value paid and no service fees are generated on the product.  The value of the purchase is netted against the reimbursement from our customer with a resulting zero value in our reported revenue and costs of revenue.</font></font></div> <div style="text-align: justify; text-indent: 0pt; display: block; margin-left: 27pt; margin-right: 0pt;"><font style="display: inline; font-family: times new roman; font-size: 10pt; font-weight: bold;"> </font></div> <div style="text-align: left; display: block;"> <p style="text-align: justify; margin-left: 27pt; font: 10pt times new roman, times, serif;"><i>Fair Value Measurements.</i> The Company accounts for fair value in accordance with ASC topic No. 820- <i>Fair Value Measurements and Disclosures </i>for all financial and non-financial assets and liabilities accounted for at fair value on a recurring basis. ASC topic No. 820 defines fair value, establishes a framework for measuring fair value in accordance with accounting principles generally accepted in the United States of America, and expands disclosures about fair value measurements.</p> <p style="text-align: justify; margin-left: 27pt; font: 10pt times new roman, times, serif;">The Company determined the fair values of certain financial instruments based on the fair value hierarchy established in ASC topic No. 820. ASC topic No. 820 requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The standard describes three levels of inputs that may be used to measure fair value.</p> <p style="text-align: justify; margin-left: 27pt; font: 10pt times new roman, times, serif;">Level 1: Quoted market prices in active markets for identical assets or liabilities.</p> <p style="text-align: justify; margin-left: 27pt; font: 10pt times new roman, times, serif;">Level 2: Quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-based valuation techniques for which all significant assumptions are observable in the market or can be corroborated by observable market data for substantially the full term of the assets or liabilities.</p> <p style="text-align: justify; margin-left: 27pt; font: 10pt times new roman, times, serif;">Level 3: Unobservable inputs developed using the Company’s estimates and assumptions, which reflect those that the market participants would use.</p> <p style="text-align: justify; margin-left: 27pt; font: 10pt times new roman, times, serif;">ASC topic No. 820 defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date.</p> <p style="text-align: justify; margin-left: 27pt; font: 10pt times new roman, times, serif;">The carrying value of our cash, accounts receivable, accounts payable and other debt instruments approximates fair value since our debt instrument consists of a revolving credit line, which under certain conditions can mature within one year of June 30, 2013, and because of its short term nature. The interest rate is equal to the market rate for such instruments of similar duration and credit quality.</p> <p style="text-align: justify; margin-left: 27pt; font: 10pt times new roman, times, serif;">The Company’s assets measured at fair market value on a recurring basis are as follows: </p> </div> <div style="text-align: left; display: block;"> <p style="text-align: justify; text-indent: -9pt; margin: 0px 0px 0px 0.5in; font: 10pt times new roman, times, serif;"> </p> <table style="font: 10pt/normal times new roman, times, serif; width: 100%; border-collapse: collapse; font-size-adjust: none; font-stretch: normal;" border="0" cellspacing="0" cellpadding="0"> <tr style="vertical-align: bottom;"> <td> </td> <td style="font-weight: bold;"> </td> <td style="text-align: center; font-weight: bold;" colspan="15">As of June 30, 2013</td> </tr> <tr style="vertical-align: bottom;"> <td> </td> <td style="padding-bottom: 1pt; font-weight: bold;"> </td> <td style="border-bottom: black 1pt solid; text-align: center; font-weight: bold;" colspan="15">Fair Value Measurements Using <br />(in 000’s)</td> </tr> <tr style="text-align: center; background-color: white; vertical-align: bottom;"> <td style="border-bottom: black 1pt solid; text-align: left; text-indent: -9pt; padding-left: 30pt; vertical-align: bottom; font-weight: bold;">Description</td> <td style="border-bottom: black 1pt solid; font-weight: bold;"> </td> <td style="border-bottom: black 1pt solid; font-weight: bold;"> </td> <td style="border-bottom: black 1pt solid; font-weight: bold;">Quoted Prices in Active Markets for Identical Assets (Level 1)</td> <td style="border-bottom: black 1pt solid; font-weight: bold;"> </td> <td style="border-bottom: black 1pt solid; font-weight: bold;"> </td> <td style="border-bottom: black 1pt solid; font-weight: bold;"> </td> <td style="border-bottom: black 1pt solid; font-weight: bold;">Significant Other Observable Inputs (Level 2)</td> <td style="border-bottom: black 1pt solid; font-weight: bold;"> </td> <td style="border-bottom: black 1pt solid; font-weight: bold;"> </td> <td style="border-bottom: black 1pt solid; font-weight: bold;"> </td> <td nowrap="nowrap" style="border-bottom: black 1pt solid; font-weight: bold;"> <p style="margin-top: 0px; margin-bottom: 0px;">Significant</p> <p style="margin-top: 0px; margin-bottom: 0px;">Unobservable</p> <p style="margin-top: 0px; margin-bottom: 0px;">Inputs</p> <p style="margin-top: 0px; margin-bottom: 0px;">(Level 3)</p> </td> <td style="border-bottom: black 1pt solid; font-weight: bold;"> </td> <td style="border-bottom: black 1pt solid; font-weight: bold;"> </td> <td style="border-bottom: black 1pt solid; font-weight: bold;"> </td> <td style="border-bottom: black 1pt solid; font-weight: bold;">Total</td> <td style="border-bottom: black 1pt solid; font-weight: bold;"> </td> </tr> <tr style="background-color: white; vertical-align: bottom;"> <td style="text-align: left; padding-bottom: 1pt; padding-left: 20pt; vertical-align: top;"> </td> <td style="padding-bottom: 1pt;"> </td> <td style="text-align: left;"> </td> <td style="text-align: right;"> </td> <td style="text-align: left; padding-bottom: 1pt;"> </td> <td style="padding-bottom: 1pt;"> </td> <td style="text-align: left;"> </td> <td style="text-align: right;"> </td> <td style="text-align: left; padding-bottom: 1pt;"> </td> <td style="padding-bottom: 1pt;"> </td> <td style="text-align: left;"> </td> <td style="text-align: right;"> </td> <td style="text-align: left; padding-bottom: 1pt;"> </td> <td style="padding-bottom: 1pt;"> </td> <td style="text-align: left;"> </td> <td style="text-align: right;"> </td> <td style="text-align: left; padding-bottom: 1pt;"> </td> </tr> <tr style="background-color: white; vertical-align: bottom;"> <td style="text-align: left; padding-bottom: 1pt; padding-left: 20pt; width: 40%; vertical-align: top;">Deferred Compensation plan assets held in Rabbi Trust (1)</td> <td style="padding-bottom: 1pt; width: 3%;"> </td> <td style="border-bottom: black 1pt solid; text-align: left; width: 1%;">$</td> <td style="border-bottom: black 1pt solid; text-align: right; width: 10%;">908 </td> <td style="text-align: left; padding-bottom: 1pt; width: 1%;"> </td> <td style="padding-bottom: 1pt; width: 3%;"> </td> <td style="border-bottom: black 1pt solid; text-align: left; width: 1%;">$</td> <td style="border-bottom: black 1pt solid; text-align: right; width: 10%;">—  </td> <td style="text-align: left; padding-bottom: 1pt; width: 1%;"> </td> <td style="padding-bottom: 1pt; width: 3%;"> </td> <td style="border-bottom: black 1pt solid; text-align: left; width: 1%;">$</td> <td style="border-bottom: black 1pt solid; text-align: right; width: 10%;">—  </td> <td style="text-align: left; padding-bottom: 1pt; width: 1%;"> </td> <td style="padding-bottom: 1pt; width: 3%;"> </td> <td style="border-bottom: black 1pt solid; text-align: left; width: 1%;">$</td> <td style="border-bottom: black 1pt solid; text-align: right; width: 10%;">908</td> <td style="text-align: left; padding-bottom: 1pt; width: 1%;"> </td> </tr> <tr style="background-color: white; vertical-align: bottom;"> <td style="text-indent: -9pt; padding-left: 0.5in;"> </td> <td> </td> <td style="text-align: left;"> </td> <td style="text-align: right;"> </td> <td style="text-align: left;"> </td> <td> </td> <td style="text-align: left;"> </td> <td style="text-align: right;"> </td> <td style="text-align: left;"> </td> <td> </td> <td style="text-align: left;"> </td> <td style="text-align: right;"> </td> <td style="text-align: left;"> </td> <td> </td> <td style="text-align: left;"> </td> <td style="text-align: right;"> </td> <td style="text-align: left;"> </td> </tr> <tr style="background-color: white; vertical-align: bottom;"> <td style="text-align: left; padding-bottom: 1pt; padding-left: 20pt; vertical-align: top;">Total</td> <td style="padding-bottom: 2.5pt;"> </td> <td style="border-bottom: black 2.5pt double; text-align: left;">$</td> <td style="border-bottom: black 2.5pt double; text-align: right;">908 </td> <td style="text-align: left; padding-bottom: 2.5pt;"> </td> <td style="padding-bottom: 2.5pt;"> </td> <td style="border-bottom: black 2.5pt double; text-align: left;">$</td> <td style="border-bottom: black 2.5pt double; text-align: right;">—  </td> <td style="text-align: left; padding-bottom: 2.5pt;"> </td> <td style="padding-bottom: 2.5pt;"> </td> <td style="border-bottom: black 2.5pt double; text-align: left;">$</td> <td style="border-bottom: black 2.5pt double; text-align: right;">—  </td> <td style="text-align: left; padding-bottom: 2.5pt;"> </td> <td style="padding-bottom: 2.5pt;"> </td> <td style="border-bottom: black 2.5pt double; text-align: left;">$</td> <td style="border-bottom: black 2.5pt double; text-align: right;">908</td> <td style="text-align: left; padding-bottom: 2.5pt;"> </td> </tr> <tr style="background-color: white; vertical-align: bottom;"> <td> </td> <td> </td> <td style="text-align: left;"> </td> <td style="text-align: right;"> </td> <td style="text-align: left;"> </td> <td> </td> <td style="text-align: left;"> </td> <td style="text-align: right;"> </td> <td style="text-align: left;"> </td> <td> </td> <td style="text-align: left;"> </td> <td style="text-align: right;"> </td> <td style="text-align: left;"> </td> <td> </td> <td style="text-align: left;"> </td> <td style="text-align: right;"> </td> <td style="text-align: left;"> </td> </tr> </table> <p style="text-align: justify; text-indent: -9pt; margin: 0px 0px 0px 0.5in; font: 10pt/12pt times new roman, times, serif;"> </p> <table style="font: 10pt/normal times new roman, times, serif; width: 100%; border-collapse: collapse; font-size-adjust: none; font-stretch: normal;" cellspacing="0" cellpadding="0"> <tr style="vertical-align: bottom;"> <td> </td> <td style="font-weight: bold;"> </td> <td style="text-align: center; font-weight: bold;" colspan="15">As of December 31, 2012</td> </tr> <tr style="vertical-align: bottom;"> <td> </td> <td style="padding-bottom: 1pt; font-weight: bold;"> </td> <td style="border-bottom: black 1pt solid; text-align: center; font-weight: bold;" colspan="15">Fair Value Measurements Using <br />(in 000’s)</td> </tr> <tr style="text-align: center; background-color: white; vertical-align: bottom;"> <td style="border-bottom: black 1pt solid; text-align: left; text-indent: -9pt; padding-left: 30pt; vertical-align: bottom; font-weight: bold;">Description</td> <td style="border-bottom: black 1pt solid; font-weight: bold;"> </td> <td style="border-bottom: black 1pt solid; font-weight: bold;"> </td> <td style="border-bottom: black 1pt solid; font-weight: bold;">Quoted Prices in Active Markets for Identical Assets (Level 1)</td> <td style="border-bottom: black 1pt solid; font-weight: bold;"> </td> <td style="border-bottom: black 1pt solid; font-weight: bold;"> </td> <td style="border-bottom: black 1pt solid; font-weight: bold;"> </td> <td style="border-bottom: black 1pt solid; font-weight: bold;">Significant Other Observable Inputs (Level 2)</td> <td style="border-bottom: black 1pt solid; font-weight: bold;"> </td> <td style="border-bottom: black 1pt solid; font-weight: bold;"> </td> <td style="border-bottom: black 1pt solid; font-weight: bold;"> </td> <td style="border-bottom: black 1pt solid; font-weight: bold;"> <p style="margin-top: 0px; margin-bottom: 0px;">Significant Unobservable Inputs</p> <p style="margin-top: 0px; margin-bottom: 0px;">(Level 3)</p> </td> <td style="border-bottom: black 1pt solid; font-weight: bold;"> </td> <td style="border-bottom: black 1pt solid; font-weight: bold;"> </td> <td style="border-bottom: black 1pt solid; font-weight: bold;"> </td> <td style="border-bottom: black 1pt solid; font-weight: bold;">Total</td> <td style="border-bottom: black 1pt solid; font-weight: bold;"> </td> </tr> <tr style="background-color: white; vertical-align: bottom;"> <td style="text-align: left; padding-bottom: 1pt; padding-left: 20pt; vertical-align: top;"> </td> <td style="padding-bottom: 1pt;"> </td> <td style="text-align: left;"> </td> <td style="text-align: right;"> </td> <td style="text-align: left; padding-bottom: 1pt;"> </td> <td style="padding-bottom: 1pt;"> </td> <td style="text-align: left;"> </td> <td style="text-align: right;"> </td> <td style="text-align: left; padding-bottom: 1pt;"> </td> <td style="padding-bottom: 1pt;"> </td> <td style="text-align: left;"> </td> <td style="text-align: right;"> </td> <td style="text-align: left; padding-bottom: 1pt;"> </td> <td style="padding-bottom: 1pt;"> </td> <td style="text-align: left;"> </td> <td style="text-align: right;"> </td> <td style="text-align: left; padding-bottom: 1pt;"> </td> </tr> <tr style="background-color: white; vertical-align: bottom;"> <td style="text-align: left; padding-bottom: 1pt; padding-left: 20pt; width: 40%; vertical-align: top;">Deferred Compensation plan assets held in Rabbi Trust (1)</td> <td style="padding-bottom: 1pt; width: 3%;"> </td> <td style="border-bottom: black 1pt solid; text-align: left; width: 1%;">$</td> <td style="border-bottom: black 1pt solid; text-align: right; width: 10%;">837 </td> <td style="text-align: left; padding-bottom: 1pt; width: 1%;"> </td> <td style="padding-bottom: 1pt; width: 3%;"> </td> <td style="border-bottom: black 1pt solid; text-align: left; width: 1%;">$</td> <td style="border-bottom: black 1pt solid; text-align: right; width: 10%;">—  </td> <td style="text-align: left; padding-bottom: 1pt; width: 1%;"> </td> <td style="padding-bottom: 1pt; width: 3%;"> </td> <td style="border-bottom: black 1pt solid; text-align: left; width: 1%;">$</td> <td style="border-bottom: black 1pt solid; text-align: right; width: 10%;">—  </td> <td style="text-align: left; padding-bottom: 1pt; width: 1%;"> </td> <td style="padding-bottom: 1pt; width: 3%;"> </td> <td style="border-bottom: black 1pt solid; text-align: left; width: 1%;">$</td> <td style="border-bottom: black 1pt solid; text-align: right; width: 10%;">837</td> <td style="text-align: left; padding-bottom: 1pt; width: 1%;"> </td> </tr> <tr style="background-color: white; vertical-align: bottom;"> <td style="text-align: left; padding-bottom: 1pt; padding-left: 20pt; vertical-align: top;"> </td> <td style="padding-bottom: 1pt;"> </td> <td style="border-bottom: black 1pt solid; text-align: left;"> </td> <td style="border-bottom: black 1pt solid; text-align: right;"> </td> <td style="text-align: left; padding-bottom: 1pt;"> </td> <td style="padding-bottom: 1pt;"> </td> <td style="border-bottom: black 1pt solid; text-align: left;"> </td> <td style="border-bottom: black 1pt solid; text-align: right;"> </td> <td style="text-align: left; padding-bottom: 1pt;"> </td> <td style="padding-bottom: 1pt;"> </td> <td style="border-bottom: black 1pt solid; text-align: left;"> </td> <td style="border-bottom: black 1pt solid; text-align: right;"> </td> <td style="text-align: left; padding-bottom: 1pt;"> </td> <td style="padding-bottom: 1pt;"> </td> <td style="border-bottom: black 1pt solid; text-align: left;"> </td> <td style="border-bottom: black 1pt solid; text-align: right;"> </td> <td style="text-align: left; padding-bottom: 1pt;"> </td> </tr> <tr style="background-color: white; vertical-align: bottom;"> <td style="text-align: left; padding-bottom: 1pt; padding-left: 20pt; vertical-align: top;">Total</td> <td style="padding-bottom: 2.5pt;"> </td> <td style="border-bottom: black 2.5pt double; text-align: left;">$</td> <td style="border-bottom: black 2.5pt double; text-align: right;">837 </td> <td style="text-align: left; padding-bottom: 2.5pt;"> </td> <td style="padding-bottom: 2.5pt;"> </td> <td style="border-bottom: black 2.5pt double; text-align: left;">$</td> <td style="border-bottom: black 2.5pt double; text-align: right;">—  </td> <td style="text-align: left; padding-bottom: 2.5pt;"> </td> <td style="padding-bottom: 2.5pt;"> </td> <td style="border-bottom: black 2.5pt double; text-align: left;">$</td> <td style="border-bottom: black 2.5pt double; text-align: right;">—  </td> <td style="text-align: left; padding-bottom: 2.5pt;"> </td> <td style="padding-bottom: 2.5pt;"> </td> <td style="border-bottom: black 2.5pt double; text-align: left;">$</td> <td style="border-bottom: black 2.5pt double; text-align: right;">837</td> <td style="text-align: left; padding-bottom: 2.5pt;"> </td> </tr> <tr style="background-color: white; vertical-align: bottom;"> <td> </td> <td> </td> <td style="text-align: left;"> </td> <td style="text-align: right;"> </td> <td style="text-align: left;"> </td> <td> </td> <td style="text-align: left;"> </td> <td style="text-align: right;"> </td> <td style="text-align: left;"> </td> <td> </td> <td style="text-align: left;"> </td> <td style="text-align: right;"> </td> <td style="text-align: left;"> </td> <td> </td> <td style="text-align: left;"> </td> <td style="text-align: right;"> </td> <td style="text-align: left;"> </td> </tr> </table> <p style="text-align: justify; margin-top: 0pt; font: 10pt times new roman, times, serif; margin-bottom: 0pt; margin-left: 20pt;"> </p> <p style="text-align: justify; margin-top: 0pt; font: 10pt times new roman, times, serif; margin-bottom: 0pt; margin-left: 20pt;">(1)     This is an executive deferred compensation plan for certain employees, as designated by the Company’s Board of Directors. The Company invests contributions to this plan in employee-directed marketable equity securities which are recorded in other assets on the accompanying consolidated balance sheets at quoted market prices. The contributions are fully invested in five different mutual funds having various growth, industry and geographic characteristics.</p> <p style="text-align: justify; text-indent: -9pt; margin: 0px 0px 0px 0.5in; font: 10pt times new roman, times, serif;">  </p> <p style="text-align: justify; margin-top: 0pt; font: 10pt times new roman, times, serif; margin-bottom: 0pt; margin-left: 20pt;">There were no significant transfers into and out of any level of the fair value hierarchy for assets measured at fair value for the three months ended June 30, 2013 or the year ended December 31, 2012.</p> <p style="text-indent: -9pt; margin: 0px 0px 0px 0.5in; font: 10pt times new roman, times, serif;"> </p> <p style="text-align: justify; margin-top: 0pt; font: 10pt times new roman, times, serif; margin-bottom: 0pt; margin-left: 20pt;">All transfers, if any, are recognized by the Company at the end of each reporting period.</p> <p style="text-indent: -9pt; margin: 0px 0px 0px 0.5in; font: 10pt times new roman, times, serif;"> </p> <p style="text-align: justify; margin-top: 0pt; font: 10pt times new roman, times, serif; margin-bottom: 0pt; margin-left: 20pt;">Transfers between Levels 1 and 2 generally relate to whether a market becomes active or inactive. Transfers between Levels 2 and 3 generally relate to whether significant relevant observable inputs are available for the fair value measurement in their entirety.</p> </div> <div align="left" style="text-indent: 0pt; display: block; margin-left: 27pt; margin-right: 0pt;"><font style="font-style: italic; display: inline; font-family: times new roman; font-size: 10pt; font-weight: bold;"></font> </div> <div align="justify" style="text-indent: 0pt; display: block; margin-left: 20pt; margin-right: 0pt;"><font style="font-style: italic; display: inline; font-family: times new roman; font-size: 10pt; font-weight: bold;">Recent Accounting Pronouncements</font></div> <div align="justify" style="text-indent: 0pt; display: block; margin-left: 0pt; margin-right: 0pt;"> </div> <div align="justify" style="text-indent: 0pt; display: block; margin-left: 20pt; margin-right: 0pt;"><font style="display: inline; font-family: times new roman; font-size: 10pt;">In February 2013, the FASB issued ASU 2013-02 to Topic 220 - <font style="font-style: italic; display: inline;">Presentation of Comprehensive Income: Deferral of the Effective Date for Amendments to the Presentation of Reclassifications of Items Out of Accumulated Other Comprehensive Income in Accounting Standards Update No. 2011-05</font>. The amendments to the Codification in this ASU require additional disclosure on the face of financial statements or in the notes to the financial statements, depending on materiality, for amounts reclassified out of accumulated other comprehensive income by component.  This ASU supersedes certain presentation requirements of ASU No. 2011-05 and ASU 2011-12 to Topic 220.  This amendment to this ASU was effective for reporting periods beginning after December 15, 2012 with early adoption permitted.  The Company adopted these provisions in the fourth quarter of 2012. Adoption of this provisions did not have a material impact on the Company’s consolidated financial statements since the Company has only immaterial other comprehensive income amounts.</font></div>falsefalsefalsenonnum:textBlockItemTypenaThe entire disclosure for all significant accounting policies of the reporting entity.Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=6367646&loc=d3e18780-107790 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6367646&loc=d3e18726-107790 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section 50 -Paragraph 6 -URI http://asc.fasb.org/extlink&oid=6367646&loc=d3e18861-107790 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=6367646&loc=d3e18743-107790 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section 50 -Paragraph 5 -URI http://asc.fasb.org/extlink&oid=6367646&loc=d3e18854-107790 false0THE COMPANY AND SIGNIFICANT ACCOUNTING POLICIESfalseTHE COMPANY AND SIGNIFICANT ACCOUNTING POLICIESUnKnownUnKnownUnKnownUnKnowntruefalsefalseSheethttp://www.innotrac.com/role/SIGNIFICANTACCOUNTINGPOLICIES12