10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q  

ý QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended: March 31, 2015

or

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from __________ to __________

Commission File Number: 000-50302

SILVERSUN TECHNOLOGIES, INC.

(Exact name of registrant as specified in its charter)

Delaware	16-1633636
(State or other jurisdiction of incorporation)	(IRS Employer Identification No.)

5 Regent Street

Livingston, NJ 07039

(Address of principal executive offices)

(973) 396-1720

(Registrant’s telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by section 13 or 15(d) of the Securities Exchange Act of 1934 during the past 12 months, and (2) has been subject to such filing requirements for the past 90 days.   Yes x No ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files.  Yes x    No  o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act:

Large accelerated filer	¨	Accelerated filer	¨
Non-accelerated filer	¨	Smaller reporting company	x

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).  Yes ¨    No x

As of May 5, 2015, there were 4,331,252 shares outstanding of the registrant’s common stock.  

SILVERSUN TECHNOLOGIES, INC.

TABLE OF CONTENTS

		Page No.
PART I.    FINANCIAL INFORMATION
Item 1.	Condensed Consolidated Financial Statements (unaudited):	3
	Condensed Consolidated Balance Sheets as of March 31, 2015 and December 31, 2014	3
	Condensed Consolidated Statements of Income for the Three Months Ended March 31, 2015 and 2014	4
	Condensed Consolidated Statement of Equity for the Twelve Months Ended December 31, 2014 and the Three Months Ended March 31, 2015	5
	Condensed Consolidated Statements of Cash Flows for the Three Months Ended March 31, 2015 and 2014	6
	Notes to Condensed Consolidated Financial Statements	8
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	19
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	26
Item 4.	Controls and Procedures	26
PART II.   OTHER INFORMATION
Item 1.	Legal Proceedings	27
Item 1A.	Risk Factors	27
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	27
Item 3.	Defaults Upon Senior Securities	27
Item 4.	Mine Safety Disclosures	27
Item 5.	Other Information	27
Item 6.	Exhibits	27

PART I – FINANCIAL INFORMATION 

Item 1.  Financial Statements

SILVERSUN TECHNOLOGIES, INC. AND SUBSIDIARY

CONDENSED CONSOLIDATED BALANCE SHEETS

 (Unaudited)

ASSETS	March 31, 2015			December 31, 2014
Current assets:
Cash and cash equivalents	$	2,384,381		$	1,308,337
Accounts receivable, net of allowance of $125,000		2,304,636			2,097,454
Unbilled services		518,055			230,000
Prepaid expenses and other current assets		207,056			195,779
Deferred tax asset – current		38,000			38,000
Total current assets		5,452,128			3,869,570
Property and equipment, net		281,716			295,054
Intangible assets, net		990,732			809,481
Goodwill		56,000			56,000
Deferred tax assets		190,500			-
Deposits and other assets		28,988			26,725
Total assets	$	7,000,064		$	5,056,830
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	1,512,820		$	1,393,541
Accrued expenses		690,544			794,157
Accrued interest		14,484			14,716
Income taxes payable		291,083			76,000
Long term debt - current portion		186,607			174,578
Capital lease obligations – current portion		58,103			65,269
Deferred revenue		2,471,104			2,215,114
Total current liabilities		5,224,745			4,733,375
Long term debt, net of current portion		343,537			242,926
Capital lease obligations, net of current portion		54,580			66,922
Total liabilities		5,622,862			5,043,223
Commitments and contingencies		-			-
Stockholders’ equity:
Preferred stock, $0.001 par value; authorized 1,000,000 shares No shares issued and outstanding		-			-
Series A Preferred Stock, $0.001 par value; authorized 2 shares  No shares issued and outstanding		-			-
Series B Preferred Stock, $.001 par value; authorized 1 share 0 and 1 share issued and outstanding		-			1
Common stock:
Par value $.00001; authorized 75,000,000 shares 4,331,252  and 3,959,064 shares issued and outstanding		44			40
Additional paid-in capital		11, 872,468			11,030,043
Accumulated deficit		(10,495,310	)		(11,016,477	)
Total stockholders’ equity		1,377,202			13,607
Total liabilities and stockholders’ equity	$	7,000,064		$	5,056,830

 See accompanying notes to condensed consolidated financial statements.

3

SILVERSUN TECHNOLOGIES, INC. AND SUBSIDIARY

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)

	Three Months Ended March 31,
	2015			2014
Revenues:
Software product, net	$	1,382,742		$	609,970
Service, net		5,100,372			4,314,655
Total revenues, net		6,483,114			4,924,625
Cost of revenues:
Product		637,509			327,402
Service		3,045,333			2,492,179
Total cost of revenues		3,682,842			2,819,581
Gross profit		2,800,272			2,105,044
Selling, general and administrative expenses :
Selling and marketing expenses		912,130			732,275
General and administrative expenses		1,187,814			1,082,110
Share based compensation		30,405			11,284
Depreciation and amortization		111,956			77,733
Total selling, general and administrative expenses		2,242,305			1,903,402
Income from operations		557,967			201,642
Other income (expense)
Interest expense, net		(12,217	)		(9,990	)
Total other income (expense)		(12,217	)		(9,990	)
Income before taxes		545,750			191,652
Provision for income taxes		24,583			70,911
Net income	$	521,167		$	120,741
Net income per common share – basic and fully diluted	$	0.13		$	0.03
Weighted average shares
Basic		4,042,317			3,930,529
Diluted		4,051,338			3,930,529

See accompanying footnotes to the condensed consolidated financial statements

4

SILVERSUN TECHNOLOGIES, INC. AND SUBSIDIARY

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)

FOR THE YEAR ENDED DECEMBER 31, 2014 AND THREE MONTHS ENDED MARCH 31, 2015

	Series A Preferred Stock				Series B Preferred Stock						Common Stock  Class A				Additional Paid in			Accumulated Equity			Total Stockholders’ Equity
	Shares		Amount		Shares			Amount			Shares		Amount		Capital			(Deficit)			(Deficit)
Balance at January 1, 2014		-	$	-		1		$	1			3,922,566	$	39	$	10,809,499		$	(11,209,378	)	$	(399,839	)
Common stock issued in a cashless exercise of warrants		-		-		-			-			4,167		-		(1	)		-			(1	)
Issuance of common stock for repayment of accrued liabilities		-		-		-			-			5,331		-		20,792						20,792
Share-Based Compensation		-		-		-			-			-		-		130,253			-			130,253
Issuance of common stock for services		-		-		-			-			27,000		1		69,500			-			69,501
Net income		-		-		-			-			-		-		-			192,901			192,901
Balance at December 31, 2014		-	$	-		1		$	1			3,959,064	$	40	$	11,030,043		$	(11,016,477	)	$	13,607
Cancellation of preferred share		-		-		(1	)		(1	)		-		-		1			-			-
Issuance of common stock, net of fees		-		-		-			-			363,490		4		812,019			-			812,023
Roundup of fractional shares		-		-		-			-			8,698		-		-			-			-
Share-Based Compensation		-		-		-			-			-		-		30,405			-			30,405
Net income		-		-		-			-			-		-		-			521,167			521,167
Balance at March 31, 2015		-	$	-		-		$	-			4,331,252	$	44	$	11,872,468		$	(10,495,310	)	$	1,377,202

The accompanying notes are an integral part of these consolidated financial statements. 

5

SILVERSUN TECHNOLOGIES, INC. AND SUBSIDIARY

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

 (Unaudited)

	Three Months Ended  March 31,
	2015			2014
Cash flows from operating activities:
Net income	$	521,167		$	120,741
Adjustments to reconcile net income to net cash provided by operating activities
Deferred income taxes		(190,500	)		24,110
Depreciation and amortization		38,207			28,330
Amortization of intangibles		73,749			49,402
Share-based compensation		30,405			11,284
Common stock issued in exchange for services		-			20,975
Changes in assets and liabilities:
Accounts receivable		(207,182	)		(9,832	)
Unbilled services		(288,055	)		(25,000	)
Prepaid expenses and other current assets		(11,278	)		(62,477	)
Deposits and other assets		(2,263	)		-
Accounts payable		119,279			(62,031	)
Accrued expenses		(103,612	)		135,586
Income tax payable		215,083			-
Accrued interest		(232	)		(271	)
Deferred revenue		255,990			169,810
Net cash provided by operating activities		450,758			400,627
Cash flows from investing activities:
Purchase of property and equipment		(24,869	)		-
Acquisition of new business		(80,000	)		-
Net cash (used in) in investing activities		(104,869	)		-
Cash flows from financing activities:
Repayment of long-term debt		(62,360	)		(41,995	)
Principal payments under capital leases obligations		(19,508	)		(14,615	)
Issuance of common stock and warrants, net of fees		812,023			-
Net cash provided by (used in) in financing activities		730,155			(56,610	)
Net increase in cash and cash equivalents		1,076,044			344,017
Cash and cash equivalents – beginning of period		1,308,337			762,892
Cash and cash equivalents – end of period	$	2,384,381		$	1,106,909
Cash paid during period for:
Interest	$	13,143		$	4,503
Income taxes	$	22,136		$	27,733

See accompanying footnotes to the condensed consolidated financial statements.

6

 SILVERSUN TECHNOLOGIES, INC. AND SUBSIDIARY

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE THREE MONTHS ENDED MARCH 31, 2015 AND 2014

SUPPLEMENTAL SCHEDULE OF NON-CASH INVESTING AND FINANCING ACTIVITIES

For the three months ended March 31, 2015:

The Company acquired certain assets of ATR for a $175,000 promissory note in addition to a cash payment of $80,000.

On March 29, 2015, Mr. Meller returned his one share of Series B Preferred to the Company and the Company cancelled the certificate. On March 29, 2015, subject to shareholder approval, the Board approved the cancellation of the Series B Preferred Certificate of Designation.

For the three months ended March 31, 2014:

None

See accompanying footnotes to the condensed consolidated financial statements.

7

SILVERSUN TECHNOLOGIES, INC. AND SUBSIDIARY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

 (Unaudited)

NOTE 1 – DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION

Description of Business

SilverSun Technologies, Inc. (the “Company”) and wholly owned subsidiary SWK Technologies, Inc. (“SWK”) is a value added reseller and master developer for Sage Software’s Sage 100/500 and ERP X3 financial and accounting software as well as the publisher of 20 proprietary software solutions, including its own proprietary Electronic Data Interchange (EDI) software, “MAPADOC”.  The Company sells services and products to various industries including, but not limited to, manufacturers, wholesalers and distributors located throughout the United States.  The Company is publicly traded and is currently quoted on the OTCQB marketplace (“QTCQB”) under the symbol “SSNT.”

In May 2014, the Company completed the purchase of selected assets of ESC Software (“ESC”), a leading Arizona-based reseller of Sage Software and Acumatica applications. ESC’s customers and business products and services have been integrated into the infrastructure of SWK. 

In March of 2015, the Company completed the purchase of selected assets of 2000 SOFT, d/b/a Accounting Technology Resources (“ATR”).  ATR’s customers and business products and services have been integrated into the infrastructure of SWK.

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

In the opinion of management, the accompanying unaudited condensed consolidated financial statements contain all adjustments necessary to present fairly the financial position of SilverSun Technologies, Inc. as of March 31, 2015, the results of operations and cash flows for the three months ended March 31, 2015 and 2014.  These results are not necessarily indicative of the results to be expected for the full year.

The financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC) and consequently have been condensed and do not include all of the disclosures normally made in an Annual Report on Form 10-K.  The December 31, 2014 balance sheet included herein was derived from the audited financial statements included in the Company’s annual report on Form 10-K as of that date. Accordingly, the financial statements included herein should be reviewed in conjunction with the financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2014 filed with the SEC on March 31, 2015.

On February 4, 2015 the Company effected the Reverse Stock Split and every thirty (30) shares of outstanding Common Stock decreased to one (1) share of Common Stock. Similarly, the number of shares of Common Stock into which each outstanding option and warrant to purchase Common Stock is to be exercisable decreased on a 1-for-30 basis and the exercise price of each outstanding option and warrant to purchase Common Stock increased proportionately. The impact of this reverse stock split has been retroactively applied to the financial statements and the related notes.

During the three months ended March 31, 2015, there have been no material changes to the Company’s significant accounting policies than those previously disclosed in the Company’s Form 10-K for the year ended December 31, 2014.

Principals of Consolidation

The consolidated financial statements include the accounts of SilverSun Technologies, Inc. and subsidiary, of which is wholly owned. All significant intercompany transactions and balances have been eliminated in consolidation.

Use of Estimates

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 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.  Actual results could differ from those estimates.

8

SILVERSUN TECHNOLOGIES, INC. AND SUBSIDIARY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

 (Unaudited)

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Goodwill

Goodwill is the excess of acquisition cost of an acquired entity over the fair value of the identifiable net assets acquired.  Goodwill is not amortized, but tested for impairment annually or whenever indicators of impairment exist. These indicators may include a significant change in the business climate, legal factors, operating performance indicators, competition, sale or disposition of a significant portion of the business or other factors.

Definite Lived Intangible Assets and Long-lived Assets

The purchased intangible assets are recorded at fair value using an independent valuation at the date of acquisition and are amortized over the useful lives of the asset using the straight-line amortization method. 

The Company assesses potential impairment of its intangible assets and other long-lived assets when there is evidence that recent events or changes in circumstances have made recovery of an asset’s carrying value unlikely. Factors the Company considers important, which may cause impairment include, among others, significant changes in the manner of use of the acquired asset, negative industry or economic trends, and significant underperformance relative to historical or projected operating results. No impairment losses were identified or recorded for the three months ended March 31, 2015 and 2014.

Revenue Recognition

Revenue is recognized when products are shipped, or services are rendered, evidence of a contract exists, the price is fixed or reasonably determinable, and collectability is reasonably assured.

Product Revenue

Software product revenue is recognized when the product is shipped to the customer. The Company treats the software component and the professional services consulting component as two separate arrangements that represent separate units of accounting. The arrangement consideration is allocated to each unit of accounting based upon that unit’s proportion of the fair value.  In a situation where both components are present, software sales revenue is recognized when collectability is reasonably assured and the product is delivered and has stand-alone value based upon vendor specific objective evidence.

Service Revenue

Service revenue is comprised of primarily professional service consulting revenue, maintenance revenue and other ancillary services provided. Professional service revenue is recognized as service time is incurred.

With respect to maintenance services, upon the completion of one year from the date of sale, the Company offers customers an optional annual software maintenance and support agreement for subsequent periods not exceeding one year. Maintenance and support agreements are recorded as deferred revenue and recognized over the respective terms of the agreements, which typically range from three months to one year and are included in services revenue in the Consolidated Statements of Income.

Shipping and handling costs charged to customers are classified as revenue, and the shipping and handling costs incurred are included in cost of sales.

Unbilled Services

The Company recognizes revenue on its professional services as those services are performed or certain obligations are met. Unbilled services represents the revenue recognized but not yet invoiced.

Deferred Revenues

Deferred revenues consist of maintenance service, customer support services, including telephone support and deposits for future consulting services which will be earned as services are performed over the contractual or stated period, which generally ranges from three to twelve months.

9

SILVERSUN TECHNOLOGIES, INC. AND SUBSIDIARY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

 (Unaudited)

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Cash and Cash Equivalents

The Company considers all highly liquid investments purchased with original maturities of three months or less to be cash equivalents. The Company maintains cash balances at financial institutions that are insured by the Federal Deposit Insurance Corporation (“FDIC”) up to federally insured limits. At times balances may exceed FDIC insured limits. The Company has not experienced any losses in such accounts.

Concentrations

The Company maintains its cash and cash equivalents with various institutions, which exceed federally insured limits throughout the year.  At March 31, 2015 and December 31, 2014, the Company had cash on deposit of approximately $1,876,839 and $1,029,941 respectively in excess of the federally insured limits of $250,000.

For the three months ended March 31, 2015 and 2014, our top ten customers accounted for 33% ($2,124,079) and 20% ($990,367), respectively, of our total revenues.  The Company does not rely on any one specific customer for any significant portion of our revenue.

For the three months ended March 31, 2015 and 2014, purchases from one supplier through a “channel partner” agreement were approximately 42% and 45% of cost of revenues, respectively.  This channel partner agreements is for a one year term and automatically renews for an additional one year term on the anniversary of the agreements effective date.

For the three months ended March 31, 2015 and 2014, one supplier represented approximately 27% and 28% of total accounts payable respectively.

Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of trade accounts receivable and cash and cash equivalents.  As of March 31, 2015 the Company believes it has no significant risk related to its concentration of accounts receivable.

Accounts Receivable

Accounts receivable consist primarily of invoices for maintenance and professional services. Full payment for software ordered by customers is due in advance of ordering from the software supplier. Payments for maintenance and support plan renewals are due before the beginning of the maintenance period. Terms under our professional service agreements are generally 50% due in advance and the balance on completion of the services.

The Company maintains an allowance for bad debt estimated by considering a number of factors, including the length of time the amounts are past due, the Company’s previous loss history and the customer’s current ability to pay its obligations.  

Property and Equipment

Property and equipment is stated at cost, net of accumulated depreciation.  Depreciation is computed using the straight-line method based upon the estimated useful lives of the assets, generally three to seven years.  Maintenance and repairs that do not materially add to the value of the equipment nor appreciably prolong its life are charged to expense as incurred.

When assets are retired or otherwise disposed of, the cost and related accumulated depreciation are removed from the accounts and the resulting gain or loss is included in the Consolidated Statements of Income.

9

SILVERSUN TECHNOLOGIES, INC. AND SUBSIDIARY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

 (Unaudited)

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Income Taxes

Deferred income taxes reflects the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes, as well as net operating loss carryforwards. Deferred tax assets and liabilities are classified as current or non-current based on the classification of the related assets or liabilities for financial reporting, or according to the expected reversal dates of the specific temporary differences, if not related to an asset or liability for financial reporting. Valuation allowances are established against deferred tax assets if it is more likely than not that the assets will not be realized. 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 or laws is recognized in operations in the period that includes the enactment date.

The Company has federal net operating loss (“NOL”) carryforwards which are subject to limitations under Section 382 of the Internal Revenue Code.

The calculation of the Company’s tax liabilities involves dealing with uncertainties in the application of complex tax regulations. The Company recognizes liabilities for uncertain tax positions if the weight of available evidence indicates that it is more likely than not that the position will not be sustained upon a tax examination with a tax examination being presumed to occur. The Company recognizes interest and penalties as incurred in finance income (expense), net in the Consolidated Statements of Income.

There were no liabilities for uncertain tax positions at March 31, 2015 and 2014.

Reclassifications

Certain prior year amounts have been reclassified to conform to the current year presentation.  The reclassifications have had no effect on the financial position, operations or cash flows for the period ended March 31, 2014.

Fair Value Measurement

The accounting standards define fair value and establish a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use on unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs that market participants would use in pricing the asset or liability developed based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company’s assumptions about the assumptions market participants would use in pricing the asset or liability developed based on the best information available in the circumstances. The hierarchy is as follows:

Level 1: Quoted prices (unadjusted) in active markets that are accessible at the measurement date for assets or liabilities. The fair value hierarchy gives the highest priority to Level 1 inputs.

Level 2: Observable prices that are based on inputs not quoted on active markets, but corroborated by market data.

Level 3: Unobservable inputs are used when little or no market data is available. The fair value hierarchy gives the lowest priority to Level 3 inputs. 

The Company’s current financial assets and liabilities approximate fair value due to their short term nature and include cash, accounts receivable, accounts payable, and accrued liabilities.  The carrying value of longer term lease and debt obligations approximate fair value as their stated interest rates approximate the rates currently available.

Stock-Based Compensation

Compensation expense related to share-based transactions, including employee stock options, is measured and recognized in the financial statements based on a determination of the fair value. The grant date fair value is determined using the Black-Scholes-Merton (“Black-Scholes”) pricing model. For employee stock options, the Company recognizes expense over the requisite service period on a straight-line basis (generally the vesting period of the equity grant). The Company’s option pricing model requires the input of highly subjective assumptions, including the expected stock price volatility, expected term, and forfeiture rate. Any changes in these highly subjective assumptions significantly impact stock-based compensation expense.

10

SILVERSUN TECHNOLOGIES, INC. AND SUBSIDIARY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

 (Unaudited)

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Recent Accounting Pronouncements

In May 2014, the FASB issued Accounting Standard 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. This ASU is effective for annual reporting periods beginning after December 15, 2016 and early adoption is not permitted. Accordingly, the Company will adopt this ASU on January 1, 2017. Companies may use either a full retrospective or modified retrospective approach to adopt this ASU and management is currently evaluating which transition approach to use. The Company is currently assessing the impact that adopting this new accounting guidance will have on its consolidated financial statements and footnote disclosures.  In April 2015 the FASB proposed delaying the effective date by one year for public companies.

No other recently issued accounting pronouncements had or are expected to have a material impact on the Company’s consolidated financial statements.

Principals of Consolidation

The consolidated financial statements include the accounts of SilverSun Technologies, Inc. and subsidiary, of which is wholly owned. All significant intercompany transactions and balances have been eliminated in consolidation.

NOTE 3 – NET INCOME PER COMMON SHARE

The Company’s basic income per common share is based on net income for the relevant period, divided by the weighted average number of common shares outstanding during the period.  Diluted income per common share is based on net income, divided by the weighted average number of common shares outstanding during the period, including common share equivalents, such as outstanding option and warrants. The computation of diluted income per share for the three months ended March 31, 2015 does not include share equivalents as all warrants and options exceeded the average market price of the common stock for the three months ended March 31, 2015.

	Three Months Ended		Three Months  Ended
	March 31, 2015		March 31, 2014
Basic net income per share computation:
Net income	$	521,167	$	120,741
Weighted-average common shares outstanding		4,042,317		3,930,529
Basic net income per share	$	0.13	$	0.03
Diluted net income per share computation:
Net income	$	521,167	$	120,741
Weighted-average common shares outstanding		4,051,338		3,930,529
Total adjusted weighted-average shares		4,051,338		3,930,529
Diluted net income per share	$	0.13	$	0.03

11

SILVERSUN TECHNOLOGIES, INC. AND SUBSIDIARY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

 (Unaudited)

NOTE 3 – NET INCOME PER COMMON SHARE(Continued)

The following table summarizes securities that, if exercised, would have an anti-dilutive effect on earnings per share.

	Three Months March 31, 2015		Three Months March 31, 2014
Stock options		30,000		86,241
Warrants		185,078		25,000
Total potential dilutive securities not included in income per share		215,078		111,241

NOTE 4 – PROPERTY AND EQUIPMENT

Property and equipment is summarized as follows:

	March 31, 2015			December 31, 2014
Leasehold improvements	$	30,557		$	30,557
Equipment, furniture and fixtures		1,200,247			1,175,378
		1,230,804			1,205,935
Less: Accumulated depreciation		(949,088	)		(910,881	)
Property and equipment, net	$	281,716		$	295,054

Depreciation and amortization expense related to these assets for the three months ended March 31, 2015 and 2014 was $38,207 and $28,330, respectively. 

Property and equipment under capital leases are summarized as follows:

	March 31, 2015			December 31, 2014
Equipment, furniture and fixtures		297,080			297,080
Less: Accumulated depreciation		(163,862	)		(143,376	)
Property and equipment, net	$	133,218		$	153,704

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SILVERSUN TECHNOLOGIES, INC. AND SUBSIDIARY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

 (Unaudited)

NOTE 5 – INTANGIBLE ASSETS

Intangible assets consist of developed intellectual property carried at cost less accumulated amortization and customer lists acquired at fair value less accumulated amortization. Amortization is computed using the straight-line method over the five year estimated useful lives.

The components of intangible assets are as follows:

	March 31, 2015			December 31, 2014
Proprietary developed software	$	365,911		$	365,911
Intellectual property, customer list, and acquired contracts		1,243,000			988,000
Total intangible assets	$	1,608,911		$	1,353,911
Less: accumulated amortization		(618,179	)		(544,430	)
	$	990,732		$	809,481

The estimated remaining useful lives for proprietary developed software is 5 years. The estimated remaining useful lives for intellectual property and customer lists is 5 years.

Amortization expense included in depreciation and amortization was $73,749 for the three months ended March 31, 2015 as compared to $49,402 for the three months ended March 31, 2014.

The Company expects future amortization expense to be the following:

	Amortization
Balance of 2015	$	234,190
2016		321,782
2017		219,235
2018		124,175
2019		84,975
thereafter		6,375
Total	$	990,732

NOTE 6 – LINE OF CREDIT, TERM LOAN AND PROMISSORY NOTES

On August 1, 2013, the Company obtained a line of credit and term loan from the bank. The line of credit is for two years and expires on July 31, 2015. The agreement included a borrowing base calculation tied to accounts receivable with a maximum availability of $750,000 at prime plus 1.75% interest (5% at March 31, 2015).  The line is collateralized by substantially all of the assets of the Company and guaranteed by the Company’s Chief Executive Officer, Mr. Meller.  The credit facility requires the Company to pay a monitoring fee of $1,000 monthly. At March 31, 2015, the Company was in compliance with the required financial covenants the fixed charge ratio and debt to net worth. As of March 31, 2015, the availability under this line was $750,000. 

The term loan is for $350,000 for two years and matures on July 31, 2015. Monthly payments are $15,776 including interest at 8%. The term loan is collateralized by substantially all of the assets of the Company and is guaranteed by the Company’s Chief Executive Officer, Mr. Meller.  At March 31, 2015 the outstanding balance was $61,076.

On May 6, 2014, SWK acquired certain assets of ESC, Inc. pursuant to an Asset Purchase Agreement for a promissory note in the aggregate principal amount of $350,000 (the “ESC Note”) and matures on April 1, 2019. Monthly payments are $6,135 including interest at 2% per year. At March 31, 2015 the outstanding balance was $294,068. 

On March 11, 2015, SWK acquired certain assets of 2000 SOFT, Inc. d/b/a Accounting Technology Resource (ATR) pursuant to an Asset Purchase Agreement for cash of $80,000 and a promissory note for $175,000 (the “ATR Note”). The note matures on February 1, 2018.  Monthly payments are $5,012 including interest at 2% per year. At March 31, 2015 the outstanding balance was $175,000.

13

SILVERSUN TECHNOLOGIES, INC. AND SUBSIDIARY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

 (Unaudited)

NOTE 6 – LINE OF CREDIT, TERM LOAN AND PROMISSORY NOTES (Continued)

At March 31, 2015, future payments of long term debt are as follows:

Remainder of 2015	$	154,989
2016		127,427
2017		129,999
2018		87,209
2019		30,520
Total	$	530,144

NOTE 7 – CAPITAL LEASE OBLIGATIONS

The Company has entered into lease commitments for equipment that meet the requirements for capitalization. The equipment has been capitalized and is included property and equipment, net in the accompanying balance sheets.  The related obligations are based upon the present value of the future minimum lease payments with interest rates ranging from 8.5% to 11.0%.

At March 31, 2015, future payments under capital leases are as follows:

Remainder of 2015	$	52,399
2016		47,785
2017		24,281
Total minimum lease payments		124,465
Less amounts representing interest		(11,782	)
Present value of net minimum lease payments		112,683
Less current portion		(58,103	)
Long-term capital lease obligation	$	54,580

NOTE 8– EQUITY

Equity

In March 2015, 363,490 shares of common stock were sold at a price of $4.24 per share and 181,745 warrants were sold at a price of $.01. The gross proceeds raised was $1,543,015 and underwriting and expenses relating to the offering of $730,992, resulting in net proceeds to the Company of $812,023.

On March 29, 2015, Mr. Meller returned his one share of Series B Preferred to the Company and the Company cancelled the certificate. On March 29, 2015, subject to shareholder approval, the Board approved the cancellation of the Series B Preferred Certificate of Designation.

Options

In February 2014, the Company granted 50,000 incentive stock options with an exercise price of $4.50 per option to certain non-executive employees under the 2004 Stock Incentive Plan. Approximately 25,000 of the options vest immediately with the remaining 50% vesting ratably over a three-year period. The Company estimated the fair value of each option using the Black Scholes option-pricing model with the following weighted-average assumptions: expected dividend yield of 0.0%, risk-free interest rate of 0.71%, volatility at 353.95% and an expected life of 5 years. The Company estimates the forfeiture rate based on historical data. Based on an analysis of historical information, the Company has applied a forfeiture rate of 15%. As a result, the Company estimated the value of these options at $115,488.

In May 2014, the Company granted 20,000 incentive stock options with an exercise price of $4.50 per option to a non – executive employee under the 2004 Stock Incentive Plan. The Company recognizes compensation cost on awards on a straight-line basis over the vesting period, approximately five years. The Company estimated the fair value of each option using the Black Scholes option-pricing model with the following weighted-average assumptions: expected dividend yield of 0.0%, risk-free interest rate of 1.68%, volatility at 328.76% and an expected life of 5 years. The Company estimates the forfeiture rate based on historical data. Based on an analysis of historical information, the Company has applied a forfeiture rate of 15%. As a result, the Company estimated the value of these options at $77,981. 

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SILVERSUN TECHNOLOGIES, INC. AND SUBSIDIARY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

 (Unaudited)

NOTE 8–  EQUITY (Continued)

In July 2014, the Company granted 10,000 incentive stock options with an exercise price of $4.50 per option to a certain non-executive employee under the 2004 Stock Incentive Plan. Options vest immediately. The Company estimated the fair value of each option using the Black Scholes option-pricing model with the following weighted-average assumptions: expected dividend yield of 0.0%, risk-free interest rate of 1.0%, volatility at 323.81% and an expected life of 5 years. As a result, the Company estimated the value of these options at $44,987.

In March 2015, the Company granted 10,000 incentive stock options with an exercise price of $4.00 per option to a certain non-executive employee under the 2004 Stock Incentive Plan. The Company recognizes compensation cost on awards on a straight-line basis over the vesting period, approximately five years. The Company estimated the fair value of each option using the Black Scholes option-pricing model with the following weighted-average assumptions: expected dividend yield of 0.0%, risk-free interest rate of 1.6%, volatility at 263.18% and an expected life of 5 years. As a result, the Company estimated the value of these options at $39,875.

The Company uses judgment in estimating the amount of stock-based awards that are expected to be forfeited. If actual forfeitures differ significantly from the original estimate, stock-based compensation expense and the results of operations could be impacted.

A summary of the status of the Company’s stock option plans for the fiscal years ended December 31, 2014 and the three months ending March 31, 2015 and changes during the years are presented below: (in number of options):

	Number of Options			Average Exercise Price		Average Remaining Contractual Term	Aggregate Intrinsic Value
Outstanding options at January 1, 2014		89,116		$	4.80	3.4 years	$	-0-
Options granted		80,000			4.50	4.3 years
Options exercised		-
Options canceled/forfeited		(5,270	)	$	4.80
Outstanding options at December 31, 2014		163,846		$	4.65	2.5 years	$	-0-
Options granted		10,000		$	4.00	4.9 years
Options exercised		-
Options canceled/forfeited		-
Outstanding options at March 31, 2015		173,846			4.62	2.9 years	$	-0-
Vested Options:
March 31, 2015;		109,321		$	2.56	1.4 years	$	-0-
December 31, 2014:		115,653		$	4.65	1.8 years	$	-0-

For the three months ended March 31, 2015 the unamortized compensation expense for stock options was $115,000.  Unamortized compensation expense is expected to be recognized over a weighted-average period of three years.

Warrants

On January 29, 2015 the Company granted 3,333 warrants with a fair value of approximately $19,969, which immediately vested, to Joseph Macaluso as part of his compensation for agreeing to join the Board of Directors. The estimated fair value of the warrant has been calculated based on a Black-Scholes pricing model using the following assumptions: a) fair market value of stock of $6.00; b) exercise price of $6.00; c) Dividend yield of 0%; d) Risk free interest rate of 1.42%; e) expected volatility of 284.28%; f) Expected life of 5 years. 

On March 9, 2015 the Company granted 18,175 warrants with a fair value of approximately $73,356, which immediately vested, to Alexander Capital, LP as partial compensation for acting as placement agent. The estimated fair value of the warrant has been calculated based on a Black-Scholes pricing model using the following assumptions: a) fair market value of stock of $4.05; b) exercise price of $5.088; c) Dividend yield of 0%; d) Risk free interest rate of 1.66%; e) expected volatility of 263.67%; f) Expected life of 5 years.

15

SILVERSUN TECHNOLOGIES, INC. AND SUBSIDIARY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

 (Unaudited)

NOTE 8–  EQUITY (Continued)

On March 23, 2015 the Company granted 181,745 warrants with a fair value of approximately $638,630, which immediately vested, to those that purchased common stock as part of the offering. The estimated fair value of the warrant has been calculated based on a Black-Scholes pricing model using the following assumptions: a) fair market value of stock of $3.53; b) exercise price of $5.30; c) Dividend yield of 0%; d) Risk free interest rate of 1.41%; e) expected volatility of 258.39%; f) Expected life of 5 years.

The following table summarizes the warrants transactions:

	Warrants Outstanding		Weighted Average Exercise Price
Balance, January 1, 2014		25,001	$	5.20
Granted		-	$	-
Exercised		8,333	$	3.60
Canceled		16,668	$	4.20
Outstanding and Exercisable December 31, 2014		-	$	-
Granted		203,252	$	5.29
Exercised		-	$	-
Canceled		-	$	-
Outstanding and Exercisable March 31, 2015		203,252	$	5.29

NOTE 9 – BUSINESS COMBINATION

On May 6, 2014 SWK entered into an Asset Purchase Agreement with ESC, Inc. d/b/a ESC Software, an Arizona corporation, and Alan H. Hardy and Michael Dobberpuhl in their individual capacity as Shareholders. SWK acquired certain assets of ESC (as defined in the Purchase Agreement). In full consideration for the acquired assets, the Company issued a promissory note in the aggregate principal amount of $350,000.   The purchase was initially allocated, based on the Company’s estimate of fair value, to intangible assets, which are expected to consist primarily of customers lists with an estimated life of five years. Upon completion of an independent valuation, the allocation of the purchase price to customer lists was modified from $350,000 to $294,000, with the excess purchase consideration being allocated to goodwill.

The following summarizes the purchase price allocation:

Customer List	$	294,000
Goodwill		56,000
Fair value of net assets acquired	$	350,000
Note to shareholders for acquisition	$	350,000
Total purchase price	$	350,000

Acquisition costs were approximately $7,500, which are included in general and administrative expenses.

On March 11, 2015 SWK entered into an Asset Purchase Agreement with 2000 SOFT, Inc. d/b/a ATR, a California corporation, and Karen Espinoza McGarrigle in her individual capacity as Shareholder. SWK acquired certain assets of ATR (as defined in the Purchase Agreement). In consideration for the acquired assets, the Company issued a promissory note in the aggregate principal amount of $175,000 and paid cash of $80,000.   As additional consideration, the Company will pay 10% of the net margin on maintenance renewals for former ATR customers for the first twelve months and 5% of the net margin on maintenance renewals for the following twelve months. The purchase was initially allocated, based on the Company’s estimate of fair value, to intangible assets, which are expected to consist primarily of customers lists with an estimated life of five years. Upon completion of an independent valuation, the allocation of the purchase price to customer lists will be modified accordingly and acquisition costs disclosed.

16

SILVERSUN TECHNOLOGIES, INC. AND SUBSIDIARY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

 (Unaudited)

NOTE 9– BUSINESS COMBINATION (Continued)

The following unaudited pro forma information does not purport to present what the Company’s actual results would have been had the acquisitions occurred on January 1, 2014, nor is the financial information indicative of the results of future operations. The following table represents the unaudited consolidated pro forma results of operations for the three months ended March 31, 2015 and 2014 as if the acquisition occurred on January 1, 2014. Operating expenses have been increased for the amortization expense associated with the estimated fair value adjustment as of March 31, 2015 of expected definite lived intangible assets.

Pro Forma	Three Months Ended March 31, 2015		Three Months Ended  March 31, 2014
Net sales	$	6,706,718	$	5,861,911
Operating expenses		2,312,471		2,148,915
Income  before taxes		561,336		277,360
Net income	$	531,454	$	174,737
Basic and diluted income per common share	$	0.13	$	0.10

The Company’s condensed consolidated financial statements for the three months ending March 31, 2015 include the actual results of ESC since the date of acquisition, May 6, 2014 and the actual results of ATR since the date of acquisition, March 11, 2015. The three months ended March 31, 2015 pro-forma results above include two months of results of ATR and for the period ended March 31, 2014 pro-forma results above include three months of pro-forma results for both ESC and ATR. For the three months ended March 31, 2015 the ESC operations had a net income before taxes of $37,592 that was included in the Company’s Condensed Consolidated Statement of Income, which consisted of approximately $318,108 in revenues and $280,516 in expenses.  For the three months ended March 31, 2015 the ATR operations had a net income before taxes of $4,841 that was included in the Company’s Condensed Consolidated Statement of Income, which consisted of approximately $90,951 in revenues and $86,110 in expenses.

NOTE 10 - INCOME TAXES

The recognized deferred tax asset is based upon the expected utilization of its benefit from future taxable income. The Company has federal net operating loss (“NOL”) carryforwards of approximately $7,442,000 as of March 31, 2015, which is subject to limitations under Section 382 of the Internal Revenue Code. These carryforward losses are available to offset future taxable income, and begin to expire in the year 2025 to 2030. 

The foregoing amounts are management’s estimates and the actual results could differ from those estimates. Future profitability in this competitive industry depends on continually obtaining and fulfilling new profitable sales agreements and modifying products.  The inability to obtain new profitable contracts could reduce estimates of future profitability, which could affect the Company’s ability to realize the deferred tax assets.

Income tax provision (benefit):

	Three Months Ended
	March 31,		March 31,
	2015		2014
Current:
Federal	$	191,831	$	46,801
State and local		23,252		-
Total current tax provision		215,083		46,801
Deferred:
Federal		8,473		24,110
State and local		1,027		-
Release of valuation allowance		(200,000)		-
Total deferred tax provision (benefit)		(190,500)		24,110
Total provision	$	24,583		70,911

17

 SILVERSUN TECHNOLOGIES, INC. AND SUBSIDIARY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

 (Unaudited)

NOTE 10 - INCOME TAXES (Continued)

For the year three months ended March 31, 2015, the Company’s Federal and State provision requirements were calculated based on the estimated tax rate. The Federal effective rate is higher than the statutory rate primarily due to Incentive Stock Options (ISO) expense which is generally never tax deductible for the Company. The provision for the three months ended March 31, 2015 was $215,083. The effective tax rate consists primarily of the 34% federal statutory tax rate and a blended 4% state and local tax rate.

For the three months ended March 31, 2015, the Company’s Federal and State provision requirements were offset by the reversal of a portion of the valuation allowance, totaling $560,000, no longer deemed necessary, and recorded a net tax benefit of $200,000, which represents a reduction in its valuation allowance on tax attributes that are expected to be utilized based on management’s assessment and evaluation of historical and projected income.

NOTE 11 – SUBSEQUENT EVENTS

On April 29, 2015 the Board approved entering into a consulting agreement with Christopher Roberts IR for the provision of investor relations services.  In addition to cash payments for services, the Company issued 15,000 shares of common stock at $2.24 per share.

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Item 2.  Management’s Discussion and Analysis of Financial Condition and Results of Operations,

This quarterly report on Form 10-Q and other reports filed by SilverSun Technologies, Inc. and Subsidiary (the “Company”) from time to time with the U.S. Securities and Exchange Commission (the “SEC”) contain or may contain forward-looking statements and information that are based upon beliefs of, and information currently available to, the Company’s management as well as estimates and assumptions made by Company’s management.  Readers are cautioned not to place undue reliance on these forward-looking statements, which are only predictions and speak only as of the date hereof.  When used in the filings, the words “anticipate,” “believe,” “estimate,” “expect,” “future,” “intend,” “plan,” or the negative of these terms and similar expressions as they relate to the Company or the Company’s management identify forward-looking statements.  Such statements reflect the current view of the Company with respect to future events and are subject to risks, uncertainties, assumptions, and other factors, including the risks contained in the “Risk Factors” section of the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2014, relating to the Company’s industry, the Company’s operations and results of operations, and any businesses that the Company may acquire.  Should one or more of these risks or uncertainties materialize, or should the underlying assumptions prove incorrect, actual results may differ significantly from those anticipated, believed, estimated, expected, intended, or planned.

Although the Company believes that the expectations reflected in the forward-looking statements are reasonable, the Company cannot guarantee future results, levels of activity, performance, or achievements.  Except as required by applicable law, including the securities laws of the United States, the Company does not intend to update any of the forward-looking statements to conform these statements to actual results.

Our financial statements are prepared in accordance with accounting principles generally accepted in the United States (“GAAP”). These accounting principles require us to make certain estimates, judgments and assumptions. We believe that the estimates, judgments and assumptions upon which we rely are reasonable based upon information available to us at the time that these estimates, judgments and assumptions are made.  These estimates, judgments and assumptions can affect the reported amounts of assets and liabilities as of the date of the financial statements as well as the reported amounts of revenues and expenses during the periods presented. Our financial statements would be affected to the extent there are material differences between these estimates and actual results. In many cases, the accounting treatment of a particular transaction is specifically dictated by GAAP and does not require management’s judgment in its application. There are also areas in which management’s judgment in selecting any available alternative would not produce a materially different result.  The following discussion should be read in conjunction with our consolidated financial statements and notes thereto appearing elsewhere in this report.

Overview

We are a business application, technology and consulting company providing strategies and solutions to meet our clients’ information, technology and business management needs. Our services and technologies enable customers to manage, protect and monetize their enterprise assets whether on-premise or in the “Cloud”. As a value added reseller of business application software, we offer solutions for accounting and business management, financial reporting, Enterprise Resource Planning (“ERP”), Warehouse Management Systems (“WMS”), Customer Relationship Management (“CRM”), and Business Intelligence (“BI”). Additionally, we have our own development staff building software solutions for Electronic Data Interchange (“EDI”), time and billing, and various ERP enhancements. Our value-added services focus on consulting and professional services, specialized programming, training, and technical support. We have a dedicated network services practice that provides managed services, hosting, business continuity, cloud, email and web services. Our customers are nationwide, with concentrations in the New York/New Jersey metropolitan area, Chicago, Dallas, Arizona and Southern California.

Our core business is divided into the following practice areas:

ERP (Enterprise Resource Management) and Accounting Software

We are a value-added reseller for a number of industry-leading ERP applications. We are a Sage Software Authorized Business Partner and Sage Certified Gold Development Partner. Forty-five percent of our customer base consists of Sage ERP X3, Sage 100 ERP, Sage 500 ERP, and Sage BusinessWorks customers. We believe we are among the largest Sage ERP X3 partners in North America, with a sales and implementation presence complemented by a scalable software development practice for customizations and enhancements. Due to the growing demand for true cloud-based ERP solutions, we have added two (2) industry leading applications to our ERP portfolio: (1) NetSuite ERP, among the world’s leading cloud ERP solutions; and (2) Acumatica, a browser-based ERP solution that can be offered on premise, in the public cloud, or in a private cloud. We develop and resell a variety of add-on solutions to all our ERP and accounting packages that help customize the installation to our customers’ needs and streamline their operations.

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Value-Added Services for ERP

We go beyond simply reselling software packages; we have a consulting and professional services organization that manages the process as we move from the sales stage into implementation, go live, and production. We work inside our customers’ organizations to ensure all software and Information Technology (“IT”) solutions are enhancing their business needs. A significant portion of our services revenue comes from continuing to work with existing customers as their business needs change, upgrading from one version of software to another, or providing additional software solutions to help them grow their revenue. We have a dedicated help desk team that fields hundreds of calls every week. Our custom programming department builds specialized software packages as well as “off the shelf” enhancements, time and billing software, and a cloud solution dedicated to the craft brewing industry.

EDI (Electronic Data Interchange) Software and Services

EDI is the computer to computer exchange of standard business documents, such as purchase orders and invoices, in electronic format. A standard file format is established for each kind of document in order to facilitate the exchange of data across a variety of platforms and programs. We have a proprietary software solution, MAPADOC, which is fully integrated with the Sage ERPs. MAPADOC allows businesses to dramatically cut data entry time by eliminating duplicate entries and reduces costly errors with trading partners. MAPADOC is the only EDI solution that is built within the framework of the Sage ERPs, allowing customers to stay within one application to get their job done.

Network and Managed Services

We provide comprehensive network and managed services designed to eliminate the IT concerns of our customers. Businesses can focus on their core strengths rather than technology issues. We adapt our solutions for virtually any type of business, from large national and international product and service providers, to small businesses with local customers. Our business continuity services provide automatic on and off site backups, complete encryption, and automatic failure testing. We also provide email and web security, IT consulting, managed network, and emergency IT services. Our focus in the network and managed services practice is to focus on industry verticals in order to demonstrate our ability to better understand our customers’ needs.

20

Results of Operations for the Three Months Ended March 31, 2015 and 2014.

During the three months ended March 31, 2015 the Company continued to expand its customer base and growth trend which we believe will provide a basis for future growth.

1) Revenues increased 31.6% from the same three month period in the prior year.

2) Income from operations increased to $557,967 as compared to $201,642 for the same three month period in the prior year.

3) Net income was $521,167 as compared to $120,741 for the same three month period in the prior year.

4) As a result of an increase in sales and marketing expense, we continue to lay the foundation for continued growth.

5) Sales of the Company’s proprietary, cloud-based business management solutions created specifically for the U.S. craft brewery and distribution industry has continued to increase since its introduction to market in early 2012; and the number of new sales prospects continues to climb.

6) Continued to book significant orders for Sage ERP X3.

Revenues

Revenues for the three months ended March 31, 2015 increased $1,558,489 (31.6%) to $6,483,114 as compared to $4,924,625 for the three months ended March 31, 2014.   Software sales increased by $772,772 to $1,382,742 in 2015 from $609,970 in 2014 for an overall increase of 126.7%.  This increase was primarily due to an increase in sales of our accounting software products, such as Sage ERP X3, cloud solutions Netsuite and Acumatica, and Accellos Warehouse Management.  Service revenue increased by $785,717 to $5,100,372 in 2015 from $4,314,655 in 2014 for an overall increase of 18.2%. The overall increases are primarily due to the continued successful sales and marketing efforts and very competitive pricing, and the Company’s strategy to increase its business by seeking additional opportunities through potential acquisitions, partnerships or investments.

Gross Profit

Gross profit for the three months ended March 31, 2015 increased $695,228 (33%) to $2,800,272 as compared to $2,105,044 for the three months ended March 31, 2014. The increase in overall gross profit for this period is attributed to the increase in revenues from existing business, including the revenues from the ESC acquisition.  For the period ended March 31, 2015, the overall gross profit percentage was 43.2% as compared to 42.7 % for the period ended March 31, 2014.   The gross profit attributed to software sales increased $462,665 to $745,233 for 2015 from $282,568 in 2014 which resulted in an increase in the gross profit percentage from 46% to 54%. The mix of products being sold by the Company changes from time to time and sometimes causes the overall gross margin percentage to vary. The gross profit attributed to services increased $233,051 from 2014 to 2015 primarily due to the implementations of larger scale accounting systems. The gross profit percentage attributed to services decreases to 40% in 2015 from 42% in 2014. In addition, the Company will often enter into agreements with former resellers to take over their customers in exchange for being paid a commission for a period of time. The Company currently has 12 of these arrangements in place, which had the result of reducing the Company’s reported gross profit percentage by less than 0.39% for the three months ended March 31, 2015 and less than 0.86% for the three months ended March 31, 2014.

Operating Expenses

Selling and marketing expenses increased $179,855 (24.6%) to $912,130 for the three months ended March 31, 2015 compared to $732,275 for the three months ended March 31, 2014 due to increased sales personnel and travel expenses as a result of an increase in sales activity.

General and administrative expenses increased $105,704 (9.8%) to $1,187,814 for the three months ended March 31, 2015 as compared to $1,082,110 for the three months ended March 31, 2014 primarily as a result of increases in payroll and related expenses associated with the addition of management personnel and incremental costs associated with the acquisition of ESC and ATR.

During the three months ended March 31, 2015, the Company recognized $30,405 of share-based compensation expense as a result of the granting of stock options to some of its non-executive employees as compared to $11,284 for the same three month period in 2014.

Depreciation and amortization expense increased $34,223 for the three months ended March 31, 2015 to $111,956 as compared to $77,733 for the period ended March 31, 2014. This increase is primarily attributed to the increase in amortization associated with the intangible assets acquired from the ESC acquisition in 2014.

Income from Operations

For the year three months ended March 31, 2015, the Company had income from operations of $577,967 as compared to income from operations of $201,642 for the same period in 2014. 

21

Income Taxes

For the year three months ended March 31, 2015, the Company’s Federal and State provision requirements were calculated based on the estimated tax rate. The Federal effective rate is higher than the statutory rate primarily due to Incentive Stock Options (ISO) expense which is generally never tax deductible for the Company. The provision for the three months ended March 31, 2015 was $215,083. The effective tax rate consists primarily of the 34% federal statutory tax rate and a blended 4% state and local tax rate.

For the three months ended March 31, 2015, the Company’s Federal and State provision requirements were offset by the reversal of a portion of the valuation allowance no longer deemed necessary, and recorded a net tax benefit of $200,000, which represents a reduction in its valuation allowance on tax attributes that are expected to be utilized based on management’s assessment and evaluation of historical and projected income.

Net Income

For year three months March 31, 2015, the Company had net income of $521,167 as compared to a net income of $120,741 for the three months ended March 31, 2014 for the reasons mentioned above.  

Liquidity and Capital Resources

We are currently seeking additional operating income opportunities through potential acquisitions or investments. Such acquisitions or investments may consume cash reserves or require additional cash or equity.  Our working capital and additional funding requirements will depend upon numerous factors, including: (i) strategic acquisitions or investments; (ii) an increase to current company personnel; (iii) the level of resources that we devote to sales and marketing capabilities; (iv) technological advances; and (v) the activities of competitors.

In addition to developing new products, obtaining new customers and increasing sales to existing customers, management plans to increase its business and profitability by entering into collaboration agreements, buying assets, and acquiring companies in the business software and information technology consulting market with solid revenue streams and established customer bases that generate positive cash flow.

In October 2011, the Company obtained a line of credit from a bank. The agreement included a borrowing base calculation tied to accounts receivable with a maximum availability of $750,000.  On August 1, 2013, the Company negotiated a new line of credit and term loan from the bank. The term of the line of credit is for two years and expires on July 31, 2015. The agreement included a borrowing base calculation tied to accounts receivable with a maximum availability of $750,000 at prime plus 1.75% interest (currently 5%).  The line is collateralized by substantially all of the assets of the Company and is guaranteed by the Company’s Chief Executive Officer, Mr. Meller.  The credit facility requires the Company to pay a monitoring fee of $1,000 monthly. At March 31, 2015, the Company was in compliance with the required financial covenants, the fixed charge ratio and debt to net worth. As of March 31, 2015, the availability under this line was $750,000. 

Under the term loan, the Company borrowed $350,000 in July 2013 from a bank. The term loan expires on July 31, 2015. Monthly payments are at $15,776 including interest at 8%. The term loan is collateralized by substantially all of the assets of the Company and is guaranteed by the Company’s Chief Executive Officer, Mr. Meller.  At March 31, 2015 the outstanding balance was $61,076.

On May 6, 2014, SWK acquired certain assets of ESC, Inc. pursuant to an Asset Purchase Agreement for a promissory note in the aggregate principal amount of $350,000 (the “ESC Note”) the note matures on April 1, 2019. Monthly payments are $6,135 including interest at 2% per year. At March 31, 2015 the outstanding balance was $294,068. 

On March 11, 2015, SWK acquired certain assets of 2000 SOFT, Inc. d/b/a Accounting Technology Resource (ATR) pursuant to an Asset Purchase Agreement for cash of $80,000 and a promissory note in the aggregate amount of $175,000 (the “ATR Note”) and matures on February 1, 2018.  Monthly payments are $5,012 including interest at 2% per year. At March 31, 2015 the outstanding balance was $175,000.

In March 2015, 363,490 shares of common stock were sold at a price of $4.24 per share and 181,745 warrants were sold at a price of $.01. The gross proceeds raised was $1,543,015 and underwriting expenses of $730,992, resulting in net proceeds to the Company of $812,023.

22

During the three months ended March 31, 2015, the Company had a net increase in cash of $1,076,044.  The Company’s principal sources and uses of funds were as follows:

Cash provided by operating activities

The Company generated $450,758 in cash from operating activities for the three months ended March 31, 2015 as compared to generating $400,627 of cash for operating activities for the same period in 2014. This increase in cash provided by operating activities is primarily attributed to an increase in deferred revenues and an increase in accounts receivable offset partially by an increase in accounts payable.

Cash used in investing activities

Investing activities for the three months ended March 31, 2015 used cash of $104,869. This use of cash is attributed to higher purchases of property and equipment and the acquisition of ATR.

Cash provided by financing activities

Financing activities for the three months ended March 31, 2015 provided cash of $730,155 as compared to a use of cash of $56,610 for the same period in 2014. The increase was due primarily to the sale of common stock.

The Company believes that as a result of the growth in business, and the availability of its credit line, it has adequate liquidity to fund its operating plans for at least the next twelve months.

There was no significant impact on the Company’s operations as a result of inflation for the three months ended March 31, 2015.  

Critical Accounting Policies

The discussion and analysis of our financial condition and results of operations are based on our financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America (GAAP). The preparation of these 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. On an on-going basis, we evaluate these estimates, including those related to bad debts, inventory obsolescence, intangible assets, and litigation. We base our estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of certain assets and liabilities. Actual results may differ from these estimates under different assumptions or conditions.

For the three months ended March 31, 2015, there have been no new significant accounting policies or accounting pronouncements from those disclosed in our annual 10-K for the year ended December 31, 2014.

We have identified below the accounting policies, revenue recognition and software costs, related to what we believe are most critical to our business operations and are discussed throughout Management’s Discussion and Analysis of Financial Condition or Plan of Operation where such policies affect our reported and expected financial results.

Use of Estimates

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 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.  Actual results could differ from those estimates.

Goodwill

Goodwill is the excess of acquisition cost of an acquired entity over the fair value of the identifiable net assets acquired.  Goodwill is not amortized, but tested for impairment annually or whenever indicators of impairment exist. These indicators may include a significant change in the business climate, legal factors, operating performance indicators, competition, sale or disposition of a significant portion of the business or other factors.

Revenue Recognition

Revenue is recognized when products are shipped, or services are rendered, evidence of a contract exists, the price is fixed or reasonably determinable, and collectability is reasonably assured.

23

Product Revenue

Software product revenue is recognized when the product is shipped to the customer. The Company treats the software component and the professional services consulting component as two separate arrangements that represent separate units of accounting. The arrangement consideration is allocated to each unit of accounting based upon that unit’s proportion of the fair value.  In a situation where both components are present, software sales revenue is recognized when collectability is reasonably assured and the product is delivered and has stand-alone value based upon vendor specific objective evidence.

Service Revenue

Service revenue is comprised of primarily professional service consulting revenue, maintenance revenue and other ancillary services provided. Professional service revenue is recognized as service time is incurred.

With respect to maintenance services, upon the completion of one year from the date of sale, the Company offers customers an optional annual software maintenance and support agreement for subsequent periods not exceeding one year. Maintenance and support agreements are recorded as deferred revenue and recognized over the respective terms of the agreements, which typically range from three months to one year and are included in services revenue in the Consolidated Statements of Income.

Shipping and handling costs charged to customers are classified as revenue, and the shipping and handling costs incurred are included in cost of sales.

Accounts Receivable

Accounts receivable consist primarily of invoices for maintenance and professional services. Full payment for software ordered by customers is due in advance of ordering from the software supplier. Payments for maintenance and support plan renewals are due before the beginning of the maintenance period. Terms under our professional service agreements are generally 50% due in advance and the balance on completion of the services.

The Company maintains an allowance for bad debt estimated by considering a number of factors, including the length of time the amounts are past due, the Company’s previous loss history, the customer’s current ability to pay its obligations.  

Deferred Revenues

Deferred revenues consist of maintenance service, customer support services, including telephone support and deposits for future consulting services which will be earned as services are performed over the contractual or stated period, which generally ranges from three to twelve months.

Income Taxes

Deferred income taxes reflects the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes, as well as net operating loss carryforwards. Deferred tax assets and liabilities are classified as current or non-current based on the classification of the related assets or liabilities for financial reporting, or according to the expected reversal dates of the specific temporary differences, if not related to an asset or liability for financial reporting. Valuation allowances are established against deferred tax assets if it is more likely than not that the assets will not be realized. 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 or laws is recognized in operations in the period that includes the enactment date.

The Company has federal net operating loss (“NOL”) carryforwards which are subject to limitations under Section 382 of the Internal Revenue Code.

The calculation of the Company’s tax liabilities involves dealing with uncertainties in the application of complex tax regulations. The Company recognizes liabilities for uncertain tax positions if the weight of available evidence indicates that it is more likely than not that the position will not be sustained upon a tax examination with a tax examination being presumed to occur. The Company recognizes interest and penalties as incurred in finance income (expense), net in the Consolidated Statements of Income.

There were no liabilities for uncertain tax positions at March 31, 2015 and 2014.

24

Definite Lived Intangible Assets and Long-lived Assets

The purchased intangible assets are recorded at fair value using an independent valuation at the date of acquisition and are amortized over the useful lives of the asset using the straight-line amortization method. 

The Company assesses potential impairment of its intangible assets and other long-lived assets when there is evidence that recent events or changes in circumstances have made recovery of an asset’s carrying value unlikely. Factors the Company considers important, which may cause impairment include, among others, significant changes in the manner of use of the acquired asset, negative industry or economic trends, and significant underperformance relative to historical or projected operating results. No impairment losses were identified or recorded in the years ended December 31, 2014 and 2013.

Stock-Based Compensation

Compensation expense related to share-based transactions, including employee stock options, is measured and recognized in the financial statements based on a determination of the fair value. The grant date fair value is determined using the Black-Scholes-Merton (“Black-Scholes”) pricing model. For employee stock options, the Company recognizes expense over the requisite service period on a straight-line basis (generally the vesting period of the equity grant). The Company’s option pricing model requires the input of highly subjective assumptions, including the expected stock price volatility, expected term, and forfeiture rate. Any changes in these highly subjective assumptions significantly impact stock-based compensation expense.

Recent Accounting Pronouncements

In May 2014, the FASB issued Accounting Standard 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. This ASU is effective for annual reporting periods beginning after December 15, 2016 and early adoption is not permitted. Accordingly, the Company will adopt this ASU on January 1, 2017. Companies may use either a full retrospective or modified retrospective approach to adopt this ASU and management is currently evaluating which transition approach to use. The Company is currently assessing the impact that adopting this new accounting guidance will have on its consolidated financial statements and footnote disclosures.  In April 2015 the FASB proposed delaying the effective date by one year for public companies

No other recently issued accounting pronouncements had or are expected to have a material impact on the Company’s consolidated financial statements.

Off Balance Sheet Arrangements

During the three months ended March 31, 2015 or for fiscal 2014, we did not engage in any material off-balance sheet activities or have any relationships or arrangements with unconsolidated entities established for the purpose of facilitating off-balance sheet arrangements or other contractually narrow or limited purposes. Further, we have not guaranteed any obligations of unconsolidated entities nor do we have any commitment or intent to provide additional funding to any such entities.

25

Item 3.  Quantitative and Qualitative Disclosures About Market Risk

We do not hold any derivative instruments and do not engage in any hedging activities.

Item 4.  Controls and Procedures

(a) Evaluation of Disclosure Controls and Procedures

Pursuant to Rule 13a-15(b) under the Exchange Act, the Company carried out an evaluation, with the participation of the Company’s management, including the Company’s Principal Executive Officer (“PEO”) and Principal Financial Officer (“PFO”), of the effectiveness of the Company’s disclosure controls and procedures (as defined under Rule 13a-15(e) and 15d-15 under the Exchange Act) as of the end of the period covered by this report. Based upon that evaluation, the Company’s PEO and PFO concluded that the Company’s disclosure controls and procedures were not effective due to our limited finance staff, and the ineffective management review of complex transactionsto ensure that information required to be disclosed by the Company in the reports that the Company files or submits under the Exchange Act, is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to the Company’s management, including the Company’s PEO and PFO, as appropriate, to allow timely decisions regarding required disclosure.

Notwithstanding the material weakness, management believes that the condensed consolidated financial statements which are included in this Quarterly Report on Form 10-Q fairly present, in all material respects, the financial position of the Company at March 31, 2015 in conformity with U.S. generally accepted accounting principles.

Remediation

We are currently in the process of executing a plan of action to remediate the material weaknesses identified above.   However, we cannot be assured that these weaknesses will be remediated or that other material weaknesses will not be discovered.

(b) Changes in Internal Control over Financial Reporting

There have been no changes in our internal controls over financial reporting (as such term is defined in Rule 13a-15(f) and 15d-15(f) under the Securities Exchange Act) during the quarter ended March 31, 2015, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

26

PART II – OTHER INFORMATION

Item 1.     Legal Proceedings

We are not currently involved in any litigation that we believe could have a material adverse effect on our financial condition or results of operations. There is no action, suit, proceeding, inquiry or investigation before or by any court, public board, government agency, self-regulatory organization or body pending or, to the knowledge of the executive officers of our company or any of our subsidiaries, threatened against or affecting our company, our common stock, any of our subsidiaries or of our companies or our subsidiaries’ officers or directors in their capacities as such, in which an adverse decision could have a material adverse effect on our financial condition.

Item 1A.  Risk Factors

We believe there are no changes that constitute material changes from the risk factors previously disclosed in our Annual Report on Form 10-K for the year ended December 31, 2014, filed with the SEC on March 31, 2015.

Item 2.     Unregistered Sales of Equity Securities and Use of Proceeds

Other than disclosed above, there were no unregistered sales of equity securities that were not otherwise disclosed in a current report on Form 8-K.

Item 3.     Defaults upon Senior Securities

There has been no default in the payment of principal, interest, sinking or purchase fund installment, or any other material default, with respect to any indebtedness of the Company.

Item 4.     Mine Safety Disclosures

Not Applicable.

Item 5.     Other Information

There is no other information required to be disclosed under this item which has not been previously reported.

Item 6.     Exhibits

31.1	Certification by the Principal Executive Officer of Registrant pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (Rule 13a-14(a) or Rule 15d-14(a)).*
31.2	Certification by the Principal Financial Officer of Registrant pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (Rule 13a-14(a) or Rule 15d-14(a)).*
32.1	Certification by the Principal Executive Officer pursuant to 18 U.S.C. 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.*
32.2	Certification by the Principal Financial Officer pursuant to 18 U.S.C. 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.*
101.INS	XBRL Instance Document
101.SCH	XBRL Taxonomy Extension Schema
101.CAL	XBRL Taxonomy Extension Calculation Linkbase
101.DEF	XBRL Taxonomy Extension Definition Linkbase
101.LAB	XBRL Taxonomy Extension Label Linkbase
101.PRE	XBRL Taxonomy Extension Presentation Linkbase

* Filed herewith

27

SIGNATURES

Pursuant to the requirements of Section 13 or 15 (d) of the Securities Exchange Act of 1934, the registrant has duly caused this report on Form 10-Q to be signed on its behalf by the undersigned thereunto duly authorized.

	SILVERSUN TECHNOLOGIES, INC.
Dated: May 5, 2015	By:	/s/ Mark Meller
		Mark Meller
		Principal Executive Officer
	By:	/s/ Crandall Melvin III
		Crandall Melvin III
		Principal Accounting Officer

28

EX-31.1

EXHIBIT 31.1

CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER

PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO SECTION 302 OF

THE SARBANES-OXLEY ACT OF 2002

I, Mark Meller, certify that:

1.	I have reviewed this Form 10-Q of SilverSun Technologies, Inc.;
2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods present in this report;
4.	Along with the Principal Accounting Officer, I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13-a-15(f) and 15d-15(f)) for the registrant and have:
	a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
	b)	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
	c)	Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
	d)	Disclosed in this report any change in the registrant’s internal control over financing reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
5.	I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
	a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
	b)	Any fraud, whether or not material, that involved management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Dated: May 5, 2015	By:	/s/ Mark Meller
		Mark Meller
		Principal Executive Officer SilverSun Technologies, Inc.

EX-31.2

EXHIBIT 31.2

CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER

PURSUANT TO18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO SECTION 302 OF

THE SARBANES-OXLEY ACT OF 2002

I, Crandall Melvin III, certify that:

1.	I have reviewed this Form 10-Q of SilverSun Technologies, Inc.;
2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods present in this report;
4.	Along with the Principal Executive Officer, I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13-a-15(f) and 15d-15(f)) for the registrant and have:
	a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
	b)	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
	c)	Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
	d)	Disclosed in this report any change in the registrant’s internal control over financing reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
5.	I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
	a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
	b)	Any fraud, whether or not material, that involved management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Dated: May 5, 2015	By:	/s/ Crandall Melvin III
		Crandall Melvin III
		Principal Financial Officer SilverSun Technologies, Inc.

EX-32.1

EXHIBIT 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO SECTION 906 OF

THE SARBANES-OXLEY ACT OF 2002

In connection with this Quarterly Report of SilverSun Technologies, Inc. (the “Company”), on Form 10-Q for the quarter ended March 31, 2015, as filed with the U.S. Securities and Exchange Commission on the date hereof, I, Mark Meller, Principal Executive Officer of the Company, certify to the best of my knowledge, pursuant to 18 U.S.C. Sec. 1350, as adopted pursuant to Sec. 906 of the Sarbanes-Oxley Act of 2002, that:

(1)   Such Quarterly Report on Form 10-Q for the quarter ended March 31, 2015 fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)   The information contained in such Quarterly Report on Form 10-Q for the quarter ended March 31, 2015 fairly presents, in all material respects, the financial condition and results of operations of the Company.

Dated: May 5, 2015	By:	/s/ Mark Meller
		Mark Meller
		Principal Executive Officer SilverSun Technologies, Inc.

EX-32.2

EXHIBIT 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO SECTION 906 OF

THE SARBANES-OXLEY ACT OF 2002

In connection with this Quarterly Report of SilverSun Technologies, Inc. (the “Company”), on Form 10-Q for the quarter ended March 31, 2015, as filed with the U.S. Securities and Exchange Commission on the date hereof, I, Crandall Melvin III, Principal Accounting Officer of the Company, certify to the best of my knowledge, pursuant to 18 U.S.C. Sec. 1350, as adopted pursuant to Sec. 906 of the Sarbanes-Oxley Act of 2002, that:

(1)   Such Quarterly Report on Form 10-Q for the quarter ended March 31, 2015 fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)   The information contained in such Quarterly Report on Form 10-Q for the quarter ended March 31, 2015 fairly presents, in all material respects, the financial condition and results of operations of the Company.

Dated: May 5, 2015	By:	/s/ Crandall Melvin III
		Crandall Melvin III
		Principal Financial Officer SilverSun Technologies, Inc.

XML

NOTE 6 - LINE OF CREDIT AND TERM LOAN AND PROMISSORY NOTE (Details) - Schedule of Maturities of Long-term Debt (USD $)	Mar. 31, 2015
Schedule of Maturities of Long-term Debt [Abstract]
Remainder of 2015	$ 154,989
2016	127,427
2017	129,999
2018	87,209
2019	30,520
Total	$ 530,144

XML

NOTE 10 - INCOME TAXES (Details) (USD $)	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
NOTE 10 - INCOME TAXES (Details) [Line Items]
Operating Loss Carryforwards	$ 7,442,000
Current Income Tax Expense (Benefit)	215,083	46,801
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent	34.00%
Effective Income Tax Rate Reconciliation, State and Local Income Taxes, Percent	4.00%
Effective Income Tax Rate Reconciliation, Change in Deferred Tax Assets Valuation Allowance, Amount	(560,000)
Valuation Allowance, Deferred Tax Asset, Increase (Decrease), Amount	$ 200,000	$ 0
Minimum [Member]
NOTE 10 - INCOME TAXES (Details) [Line Items]
Operating Loss Carryforwards, Expiration Date	2025
Maximum [Member]
NOTE 10 - INCOME TAXES (Details) [Line Items]
Operating Loss Carryforwards, Expiration Date	2030

XML

NOTE 9 - BUSINESS COMBINATION (Details) - Schedule of Recognized Identified Assets Acquired and Liabilities Assumed (USD $)	0 Months Ended
	May 06, 2014	Mar. 31, 2015	Dec. 31, 2014
NOTE 9 - BUSINESS COMBINATION (Details) - Schedule of Recognized Identified Assets Acquired and Liabilities Assumed [Line Items]
Goodwill		$ 56,000	$ 56,000
ESC Inc. DBA ESC Software [Member]
NOTE 9 - BUSINESS COMBINATION (Details) - Schedule of Recognized Identified Assets Acquired and Liabilities Assumed [Line Items]
Customer List	294,000
Goodwill	56,000
Fair value of net assets acquired	350,000
Note to shareholders for acquisition	350,000
Total purchase price	$ 350,000

XML

NOTE 4 - PROPERTY AND EQUIPMENT (Details) - Schedule of Property and Equipment (USD $)	Mar. 31, 2015	Dec. 31, 2014
Schedule of Property and Equipment [Abstract]
Leasehold improvements	$ 30,557	$ 30,557
Equipment, furniture and fixtures	1,200,247	1,175,378
	1,230,804	1,205,935
Less: Accumulated depreciation	(949,088)	(910,881)
Property and equipment, net	$ 281,716	$ 295,054

XML

NOTE 8 - EQUITY (Tables)

3 Months Ended

Mar. 31, 2015

Disclosure Text Block Supplement [Abstract]

Schedule of Share-based Compensation, Stock Options, Activity [Table Text Block]

A summary of the status of the Company’s stock option plans for the fiscal years ended December 31, 2014 and the three months ending March 31, 2015 and changes during the years are presented below: (in number of options):

	Number of Options			Average Exercise Price		Average Remaining Contractual Term	Aggregate Intrinsic Value
Outstanding options at January 1, 2014		89,116		$	4.80	3.4 years	$	-0-
Options granted		80,000			4.50	4.3 years
Options exercised		-
Options canceled/forfeited		(5,270	)	$	4.80
Outstanding options at December 31, 2014		163,846		$	4.65	2.5 years	$	-0-
Options granted		10,000		$	4.00	4.9 years
Options exercised		-
Options canceled/forfeited		-
Outstanding options at March 31, 2015		173,846			4.62	2.9 years	$	-0-
Vested Options:
March 31, 2015;		109,321		$	2.56	1.4 years	$	-0-
December 31, 2014:		115,653		$	4.65	1.8 years	$	-0-

Schedule of Stockholders' Equity Note, Warrants or Rights [Table Text Block]

The following table summarizes the warrants transactions:

	Warrants Outstanding		Weighted Average Exercise Price
Balance, January 1, 2014		25,001	$	5.20
Granted		-	$	-
Exercised		8,333	$	3.60
Canceled		16,668	$	4.20
Outstanding and Exercisable December 31, 2014		-	$	-
Granted		203,252	$	5.29
Exercised		-	$	-
Canceled		-	$	-
Outstanding and Exercisable March 31, 2015		203,252	$	5.29

XML

NOTE 11 - SUBSEQUENT EVENTS (Details) (USD $)	0 Months Ended
	Apr. 29, 2015	Mar. 31, 2015
NOTE 11 - SUBSEQUENT EVENTS (Details) [Line Items]
Shares Issued, Price Per Share		$ 4.24
Subsequent Event [Member]
NOTE 11 - SUBSEQUENT EVENTS (Details) [Line Items]
Stock Issued During Period, Shares, Issued for Services	15,000
Shares Issued, Price Per Share	$ 2.24

XML

NOTE 8 - EQUITY (Details) (USD $)	1 Months Ended	3 Months Ended		12 Months Ended	0 Months Ended			1 Months Ended
	Mar. 31, 2015	Mar. 31, 2015	Mar. 31, 2014	Dec. 31, 2014	Jan. 29, 2015	Mar. 09, 2015	Mar. 23, 2015	Feb. 28, 2014	Jul. 31, 2014	May 31, 2014
NOTE 8 - EQUITY (Details) [Line Items]
Stock Issued During Period, Shares, New Issues (in Shares)		363,490
Shares Issued, Price Per Share (in Dollars per share)	$ 4.24	$ 4.24
Warrants Sold During Period, Number of Warrants (in Shares)		181,745
Sale of Warrants, Price Per Warrant (in Dollars per share)		$ 0.01
Proceeds from Issuance or Sale of Equity, Gross (in Dollars)	$ 1,543,015
Payments of Stock Issuance Costs (in Dollars)	730,992
Proceeds from Issuance or Sale of Equity (in Dollars)	812,023	812,023	0
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross (in Shares)		10,000		80,000
Share-based Compensation Arrangements by Share-based Payment Award, Options, Grants in Period, Weighted Average Exercise Price (in Dollars per share)		$ 4.00		$ 4.50
Class of Warrant or Rights, Granted (in Shares)		203,252		0
Series B Preferred Stock [Member]
NOTE 8 - EQUITY (Details) [Line Items]
Stock Repurchased and Retired During Period, Shares (in Shares)		1
Warrants Issued As Compensation [Member]
NOTE 8 - EQUITY (Details) [Line Items]
Class of Warrant or Rights, Granted (in Shares)					3,333
Warrants, Fair Value of Warrants, Granted (in Dollars)					19,969
Share Price (in Dollars per share)					$ 6.00
Class of Warrant or Right, Exercise Price of Warrants or Rights (in Dollars per share)					$ 6.00
Fair Value Assumptions, Expected Dividend Rate					0.00%
Fair Value Assumptions, Risk Free Interest Rate					1.42%
Fair Value Assumptions, Expected Volatility Rate					284.28%
Fair Value Assumptions, Expected Term					5 years
Warrants for Services [Member]
NOTE 8 - EQUITY (Details) [Line Items]
Class of Warrant or Rights, Granted (in Shares)						18,175
Warrants, Fair Value of Warrants, Granted (in Dollars)						73,356
Share Price (in Dollars per share)						$ 4.05
Class of Warrant or Right, Exercise Price of Warrants or Rights (in Dollars per share)						$ 5.088
Fair Value Assumptions, Expected Dividend Rate						0.00%
Fair Value Assumptions, Risk Free Interest Rate						1.66%
Fair Value Assumptions, Expected Volatility Rate						263.67%
Fair Value Assumptions, Expected Term						5 years
Warrants Issued as Part of Offering [Member]
NOTE 8 - EQUITY (Details) [Line Items]
Class of Warrant or Rights, Granted (in Shares)							181,745
Warrants, Fair Value of Warrants, Granted (in Dollars)							638,630
Share Price (in Dollars per share)							$ 3.53
Class of Warrant or Right, Exercise Price of Warrants or Rights (in Dollars per share)							$ 5.30
Fair Value Assumptions, Expected Dividend Rate							0.00%
Fair Value Assumptions, Risk Free Interest Rate							1.41%
Fair Value Assumptions, Expected Volatility Rate							258.39%
Fair Value Assumptions, Expected Term							5 years
Employee Stock Option [Member] | Share-based Compensation Award, Tranche One [Member] | 2004 Stock Incentive Plan [Member]
NOTE 8 - EQUITY (Details) [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested, Number of Shares (in Shares)								25,000
Employee Stock Option [Member] | Share-based Compensation Award, Tranche Two [Member] | 2004 Stock Incentive Plan [Member]
NOTE 8 - EQUITY (Details) [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Rights								remaining 50% vesting ratably over a three-year period
Employee Stock Option [Member] | 2004 Stock Incentive Plan [Member]
NOTE 8 - EQUITY (Details) [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross (in Shares)	10,000							50,000	10,000	20,000
Share-based Compensation Arrangements by Share-based Payment Award, Options, Grants in Period, Weighted Average Exercise Price (in Dollars per share)	$ 4.00							4.50	$ 4.50	$ 4.50
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Dividend Rate	0.00%							0.00%	0.00%	0.00%
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Risk Free Interest Rate	1.60%							0.71%	1.00%	1.68%
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Volatility Rate	263.18%							353.95%	323.81%	328.76%
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Term	5 years							5 years	5 years	5 years
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Forfeiture Rate								15.00%		15.00%
Share-based Compensation Arrangement by Share-based Payment Award, Options, Fair Value Grants in Period (in Dollars)	39,875							115,488	44,987	77,981
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period	5 years									5 years
Employee Service Share-based Compensation, Nonvested Awards, Compensation Not yet Recognized, Stock Options (in Dollars)	$ 115,000	$ 115,000
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized, Period for Recognition		3 years

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NOTE 5 - INTANGIBLE ASSETS (Details) - Schedule of Finite-Lived Intangible Assets, Future Amortization Expense (USD $)	Mar. 31, 2015	Dec. 31, 2014
Schedule of Finite-Lived Intangible Assets, Future Amortization Expense [Abstract]
Balance of 2015	$ 234,190
2016	321,782
2017	219,235
2018	124,175
2019	84,975
thereafter	6,375
Total	$ 990,732	$ 809,481

XML

NOTE 9 - BUSINESS COMBINATION (Details) - Schedule of Business Acquisition, Pro Forma Information (ESC Inc. DBA ESC Software [Member], USD $)	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
ESC Inc. DBA ESC Software [Member]
NOTE 9 - BUSINESS COMBINATION (Details) - Schedule of Business Acquisition, Pro Forma Information [Line Items]
Net sales	$ 6,706,718	$ 5,861,911
Operating expenses	2,312,471	2,148,915
Income before taxes	561,336	277,360
Net income	$ 531,454	$ 174,737
Basic and diluted income per common share (in Dollars per share)	$ 0.13	$ 0.10

XML

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

3 Months Ended

Mar. 31, 2015

Accounting Policies [Abstract]

Significant Accounting Policies [Text Block]

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

In the opinion of management, the accompanying unaudited condensed consolidated financial statements contain all adjustments necessary to present fairly the financial position of SilverSun Technologies, Inc. as of March 31, 2015, the results of operations and cash flows for the three months ended March 31, 2015 and 2014.  These results are not necessarily indicative of the results to be expected for the full year.

The financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC) and consequently have been condensed and do not include all of the disclosures normally made in an Annual Report on Form 10-K.  The December 31, 2014 balance sheet included herein was derived from the audited financial statements included in the Company’s annual report on Form 10-K as of that date. Accordingly, the financial statements included herein should be reviewed in conjunction with the financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2014 filed with the SEC on March 31, 2015.

On February 4, 2015 the Company effected the Reverse Stock Split and every thirty (30) shares of outstanding Common Stock decreased to one (1) share of Common Stock. Similarly, the number of shares of Common Stock into which each outstanding option and warrant to purchase Common Stock is to be exercisable decreased on a 1-for-30 basis and the exercise price of each outstanding option and warrant to purchase Common Stock increased proportionately. The impact of this reverse stock split has been retroactively applied to the financial statements and the related notes.

During the three months ended March 31, 2015, there have been no material changes to the Company’s significant accounting policies than those previously disclosed in the Company’s Form 10-K for the year ended December 31, 2014.

Principals of Consolidation

The consolidated financial statements include the accounts of SilverSun Technologies, Inc. and subsidiary, of which is wholly owned. All significant intercompany transactions and balances have been eliminated in consolidation.

Use of Estimates

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 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.  Actual results could differ from those estimates.

Goodwill

Goodwill is the excess of acquisition cost of an acquired entity over the fair value of the identifiable net assets acquired.  Goodwill is not amortized, but tested for impairment annually or whenever indicators of impairment exist. These indicators may include a significant change in the business climate, legal factors, operating performance indicators, competition, sale or disposition of a significant portion of the business or other factors.

Definite Lived Intangible Assets and Long-lived Assets

The purchased intangible assets are recorded at fair value using an independent valuation at the date of acquisition and are amortized over the useful lives of the asset using the straight-line amortization method. 

The Company assesses potential impairment of its intangible assets and other long-lived assets when there is evidence that recent events or changes in circumstances have made recovery of an asset’s carrying value unlikely. Factors the Company considers important, which may cause impairment include, among others, significant changes in the manner of use of the acquired asset, negative industry or economic trends, and significant underperformance relative to historical or projected operating results. No impairment losses were identified or recorded for the three months ended March 31, 2015 and 2014.

Revenue Recognition

Revenue is recognized when products are shipped, or services are rendered, evidence of a contract exists, the price is fixed or reasonably determinable, and collectability is reasonably assured.

Product Revenue

Software product revenue is recognized when the product is shipped to the customer. The Company treats the software component and the professional services consulting component as two separate arrangements that represent separate units of accounting. The arrangement consideration is allocated to each unit of accounting based upon that unit’s proportion of the fair value.  In a situation where both components are present, software sales revenue is recognized when collectability is reasonably assured and the product is delivered and has stand-alone value based upon vendor specific objective evidence.

Service Revenue

Service revenue is comprised of primarily professional service consulting revenue, maintenance revenue and other ancillary services provided. Professional service revenue is recognized as service time is incurred.

With respect to maintenance services, upon the completion of one year from the date of sale, the Company offers customers an optional annual software maintenance and support agreement for subsequent periods not exceeding one year. Maintenance and support agreements are recorded as deferred revenue and recognized over the respective terms of the agreements, which typically range from three months to one year and are included in services revenue in the Consolidated Statements of Income.

Shipping and handling costs charged to customers are classified as revenue, and the shipping and handling costs incurred are included in cost of sales.

Unbilled Services

The Company recognizes revenue on its professional services as those services are performed or certain obligations are met. Unbilled services represents the revenue recognized but not yet invoiced.

Deferred Revenues

Deferred revenues consist of maintenance service, customer support services, including telephone support and deposits for future consulting services which will be earned as services are performed over the contractual or stated period, which generally ranges from three to twelve months.

Cash and Cash Equivalents

The Company considers all highly liquid investments purchased with original maturities of three months or less to be cash equivalents. The Company maintains cash balances at financial institutions that are insured by the Federal Deposit Insurance Corporation (“FDIC”) up to federally insured limits. At times balances may exceed FDIC insured limits. The Company has not experienced any losses in such accounts.

Concentrations

The Company maintains its cash and cash equivalents with various institutions, which exceed federally insured limits throughout the year.  At March 31, 2015 and December 31, 2014, the Company had cash on deposit of approximately $1,876,839 and $1,029,941 respectively in excess of the federally insured limits of $250,000.

For the three months ended March 31, 2015 and 2014, our top ten customers accounted for 33% ($2,124,079) and 20% ($990,367), respectively, of our total revenues.  The Company does not rely on any one specific customer for any significant portion of our revenue.

For the three months ended March 31, 2015 and 2014, purchases from one supplier through a “channel partner” agreement were approximately 42% and 45% of cost of revenues, respectively.  This channel partner agreements is for a one year term and automatically renews for an additional one year term on the anniversary of the agreements effective date.

For the three months ended March 31, 2015 and 2014, one supplier represented approximately 27% and 28% of total accounts payable respectively.

Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of trade accounts receivable and cash and cash equivalents.  As of March 31, 2015 the Company believes it has no significant risk related to its concentration of accounts receivable.

Accounts Receivable

Accounts receivable consist primarily of invoices for maintenance and professional services. Full payment for software ordered by customers is due in advance of ordering from the software supplier. Payments for maintenance and support plan renewals are due before the beginning of the maintenance period. Terms under our professional service agreements are generally 50% due in advance and the balance on completion of the services.

The Company maintains an allowance for bad debt estimated by considering a number of factors, including the length of time the amounts are past due, the Company’s previous loss history and the customer’s current ability to pay its obligations.  

Property and Equipment

Property and equipment is stated at cost, net of accumulated depreciation.  Depreciation is computed using the straight-line method based upon the estimated useful lives of the assets, generally three to seven years.  Maintenance and repairs that do not materially add to the value of the equipment nor appreciably prolong its life are charged to expense as incurred.

When assets are retired or otherwise disposed of, the cost and related accumulated depreciation are removed from the accounts and the resulting gain or loss is included in the Consolidated Statements of Income.

Income Taxes

Deferred income taxes reflects the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes, as well as net operating loss carryforwards. Deferred tax assets and liabilities are classified as current or non-current based on the classification of the related assets or liabilities for financial reporting, or according to the expected reversal dates of the specific temporary differences, if not related to an asset or liability for financial reporting. Valuation allowances are established against deferred tax assets if it is more likely than not that the assets will not be realized. 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 or laws is recognized in operations in the period that includes the enactment date.

The Company has federal net operating loss (“NOL”) carryforwards which are subject to limitations under Section 382 of the Internal Revenue Code.

The calculation of the Company’s tax liabilities involves dealing with uncertainties in the application of complex tax regulations. The Company recognizes liabilities for uncertain tax positions if the weight of available evidence indicates that it is more likely than not that the position will not be sustained upon a tax examination with a tax examination being presumed to occur. The Company recognizes interest and penalties as incurred in finance income (expense), net in the Consolidated Statements of Income.

There were no liabilities for uncertain tax positions at March 31, 2015 and 2014.

Reclassifications

Certain prior year amounts have been reclassified to conform to the current year presentation.  The reclassifications have had no effect on the financial position, operations or cash flows for the period ended March 31, 2014.

Fair Value Measurement

The accounting standards define fair value and establish a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use on unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs that market participants would use in pricing the asset or liability developed based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company’s assumptions about the assumptions market participants would use in pricing the asset or liability developed based on the best information available in the circumstances. The hierarchy is as follows:

Level 1: Quoted prices (unadjusted) in active markets that are accessible at the measurement date for assets or liabilities. The fair value hierarchy gives the highest priority to Level 1 inputs.

Level 2: Observable prices that are based on inputs not quoted on active markets, but corroborated by market data.

Level 3: Unobservable inputs are used when little or no market data is available. The fair value hierarchy gives the lowest priority to Level 3 inputs. 

The Company’s current financial assets and liabilities approximate fair value due to their short term nature and include cash, accounts receivable, accounts payable, and accrued liabilities.  The carrying value of longer term lease and debt obligations approximate fair value as their stated interest rates approximate the rates currently available.

Stock-Based Compensation

Compensation expense related to share-based transactions, including employee stock options, is measured and recognized in the financial statements based on a determination of the fair value. The grant date fair value is determined using the Black-Scholes-Merton (“Black-Scholes”) pricing model. For employee stock options, the Company recognizes expense over the requisite service period on a straight-line basis (generally the vesting period of the equity grant). The Company’s option pricing model requires the input of highly subjective assumptions, including the expected stock price volatility, expected term, and forfeiture rate. Any changes in these highly subjective assumptions significantly impact stock-based compensation expense.

Recent Accounting Pronouncements

In May 2014, the FASB issued Accounting Standard 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. This ASU is effective for annual reporting periods beginning after December 15, 2016 and early adoption is not permitted. Accordingly, the Company will adopt this ASU on January 1, 2017. Companies may use either a full retrospective or modified retrospective approach to adopt this ASU and management is currently evaluating which transition approach to use. The Company is currently assessing the impact that adopting this new accounting guidance will have on its consolidated financial statements and footnote disclosures.  In April 2015 the FASB proposed delaying the effective date by one year for public companies.

No other recently issued accounting pronouncements had or are expected to have a material impact on the Company’s consolidated financial statements.

Principals of Consolidation

The consolidated financial statements include the accounts of SilverSun Technologies, Inc. and subsidiary, of which is wholly owned. All significant intercompany transactions and balances have been eliminated in consolidation.

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NOTE 8 - EQUITY (Details) - Schedule of Share-based Compensation, Stock Options, Activity (USD $)	3 Months Ended	12 Months Ended
	Mar. 31, 2015	Dec. 31, 2014	Dec. 31, 2013
Schedule of Share-based Compensation, Stock Options, Activity [Abstract]
Outstanding options	173,846	163,846	89,116
Outstanding options, average exercise price	$ 4.62	$ 4.65	$ 4.80
Outstanding options, average remaining contractual term	2 years 328 days	2 years 6 months	3 years 146 days
Outstanding options, aggregate intrinsic value	$ 0	$ 0	$ 0
Vested Options:
Vested option balance	109,321	115,653
Vested option balance, average exercise price	$ 2.56	$ 4.65
Vested option balance, average remaining contractual term	1 year 146 days	1 year 292 days
Vested option balance, aggregate intrinsic value	$ 0	$ 0
Options granted	10,000	80,000
Options granted, average exercise price	$ 4.00	$ 4.50
Options granted, average remaining contractual term	4 years 328 days	4 years 109 days
Options exercised	0	0
Options exercised, average exercise price	$ 0	$ 0
Options canceled/forfeited	0	(5,270)
Options canceled/forfeited, average exercise price	$ 0	$ 4.80

XML

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) (USD $)	0 Months Ended	3 Months Ended
	Feb. 04, 2014	Mar. 31, 2015	Mar. 31, 2014	Dec. 31, 2014
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) [Line Items]
Stockholders' Equity, Reverse Stock Split	1-for-30
Impairment of Intangible Assets, Finite-lived		$ 0	$ 0
Cash, Uninsured Amount		1,876,839		1,029,941
Cash, FDIC Insured Amount		250,000
Liability for Uncertain Tax Positions, Current		0	0
1 Supplier [Member] | Cost of Goods, Total [Member] | Supplier Concentration Risk [Member]
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) [Line Items]
Concentration Risk, Percentage		42.00%	45.00%
1 Supplier [Member] | Accounts Receivable [Member] | Credit Concentration Risk [Member]
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) [Line Items]
Concentration Risk, Percentage		27.00%	28.00%
Top 10 Customers [Member] | Sales Revenue, Net [Member] | Customer Concentration Risk [Member]
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) [Line Items]
Concentration Risk, Percentage		33.00%	20.00%
Revenues		$ (2,124,079)	$ (990,367)
Minimum [Member]
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) [Line Items]
Property, Plant and Equipment, Useful Life		3 years
Maximum [Member]
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) [Line Items]
Property, Plant and Equipment, Useful Life		7 years

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SUPPLEMENTAL SCHEDULE OF NON-CASH INVESTING AND FINANCING ACTIVITIES: (Details) (USD $)	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
SUPPLEMENTAL SCHEDULE OF NON-CASH INVESTING AND FINANCING ACTIVITIES: (Details) [Line Items]
Payments to Acquire Businesses, Gross	$ 80,000	$ 0
Series B Preferred Stock [Member]
SUPPLEMENTAL SCHEDULE OF NON-CASH INVESTING AND FINANCING ACTIVITIES: (Details) [Line Items]
Stock Repurchased and Retired During Period, Shares (in Shares)	1
Customer Lists [Member] | 2000 SOFT, Inc. DBA Accounting Technology Resource (ATR) [Member]
SUPPLEMENTAL SCHEDULE OF NON-CASH INVESTING AND FINANCING ACTIVITIES: (Details) [Line Items]
Notes Issued	175,000
Payments to Acquire Businesses, Gross	$ 80,000

XML

NOTE 8 - EQUITY (Details) - Schedule of Warrants or Rights, Activity (USD $)	3 Months Ended	12 Months Ended
	Mar. 31, 2015	Dec. 31, 2014
Schedule of Warrants or Rights, Activity [Abstract]
Balance, Warrants Outstanding	0	25,001
Balance, Warrants Weighted Average Exercise Price	$ 0	$ 5.20
Granted, Warrants Outstanding	203,252	0
Granted, Warrants Weighted Average Exercise Price	$ 5.29	$ 0
Exercised, Warrants Outstanding	0	8,333
Exercised, Warrants Weighted Average Exercise Price	$ 0	$ 3.60
Canceled, Warrants Outstanding	0	16,668
Canceled, Warrants Weighted Average Exercise Price	$ 0	$ 4.20
Balance, Warrants Outstanding	203,252	0
Balance, Warrants Weighted Average Exercise Price	$ 5.29	$ 0

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NOTE 3 - NET INCOME PER COMMON SHARE (Details) - Schedule of Earnings Per Share, Basic and Diluted (USD $)	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
Basic net income per share computation:
Net income (in Dollars)	$ 521,167	$ 120,741
Weighted-average common shares outstanding	4,042,317	3,930,529
Basic net income per share (in Dollars per share)	$ 0.13	$ 0.03
Diluted net income per share computation:
Net income (in Dollars)	$ 521,167	$ 120,741
Weighted-average common shares outstanding	4,051,338	3,930,529
Total adjusted weighted-average shares	4,051,338	3,930,529
Diluted net income per share (in Dollars per share)	$ 0.13	$ 0.03

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NOTE 3 - NET INCOME PER COMMON SHARE (Details) - Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Anti-dilutive securities	215,078	111,241
Equity Option [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Anti-dilutive securities	30,000	86,241
Warrant [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Anti-dilutive securities	185,078	25,000

XML

NOTE 1 - DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION

3 Months Ended

Mar. 31, 2015

Disclosure Text Block [Abstract]

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

NOTE 1 – DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION

Description of Business

SilverSun Technologies, Inc. (the “Company”) and wholly owned subsidiary SWK Technologies, Inc. (“SWK”) is a value added reseller and master developer for Sage Software’s Sage 100/500 and ERP X3 financial and accounting software as well as the publisher of 20 proprietary software solutions, including its own proprietary Electronic Data Interchange (EDI) software, “MAPADOC”.  The Company sells services and products to various industries including, but not limited to, manufacturers, wholesalers and distributors located throughout the United States.  The Company is publicly traded and is currently quoted on the OTCQB marketplace (“QTCQB”) under the symbol “SSNT.”

In May 2014, the Company completed the purchase of selected assets of ESC Software (“ESC”), a leading Arizona-based reseller of Sage Software and Acumatica applications. ESC’s customers and business products and services have been integrated into the infrastructure of SWK. 

In March of 2015, the Company completed the purchase of selected assets of 2000 SOFT, d/b/a Accounting Technology Resources (“ATR”).  ATR’s customers and business products and services have been integrated into the infrastructure of SWK.

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NOTE 4 - PROPERTY AND EQUIPMENT (Details) (USD $)	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
Property, Plant and Equipment [Abstract]
Depreciation, Depletion and Amortization	$ 38,207	$ 28,330

XML

NOTE 7 - CAPITAL LEASE OBLIGATIONS (Details)	Mar. 31, 2015
Minimum [Member]
NOTE 7 - CAPITAL LEASE OBLIGATIONS (Details) [Line Items]
Capital Leases of Lessee, Contingent Rentals, Basis Spread on Variable Rate	8.50%
Maximum [Member]
NOTE 7 - CAPITAL LEASE OBLIGATIONS (Details) [Line Items]
Capital Leases of Lessee, Contingent Rentals, Basis Spread on Variable Rate	11.00%

XML

CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (USD $)	Mar. 31, 2015	Dec. 31, 2014
Current assets:
Cash and cash equivalents	$ 2,384,381	$ 1,308,337
Accounts receivable, net of allowance of $125,000	2,304,636	2,097,454
Unbilled services	518,055	230,000
Prepaid expenses and other current assets	207,056	195,779
Deferred tax asset – current	38,000	38,000
Total current assets	5,452,128	3,869,570
Property and equipment, net	281,716	295,054
Intangible assets, net	990,732	809,481
Goodwill	56,000	56,000
Deferred tax assets	190,500
Deposits and other assets	28,988	26,725
Total assets	7,000,064	5,056,830
Current liabilities:
Accounts payable	1,512,820	1,393,541
Accrued expenses	690,544	794,157
Accrued interest	14,484	14,716
Income taxes payable	291,083	76,000
Long term debt - current portion	186,607	174,578
Capital lease obligations – current portion	58,103	65,269
Deferred revenue	2,471,104	2,215,114
Total current liabilities	5,224,745	4,733,375
Long term debt, net of current portion	343,537	242,926
Capital lease obligations, net of current portion	54,580	66,922
Total liabilities	5,622,862	5,043,223
Commitments and contingencies
Stockholders’ equity:
Preferred stock, value	0	0
Common stock:
Par value $.00001; authorized 75,000,000 shares 4,331,252 and 3,959,064 shares issued and outstanding	44	40
Additional paid-in capital	11,872,468	11,030,043
Accumulated deficit	(10,495,310)	(11,016,477)
Total stockholders’ equity	1,377,202	13,607
Total liabilities and stockholders’ equity	7,000,064	5,056,830
Series A Preferred Stock [Member]
Stockholders’ equity:
Preferred stock, value	0	0
Series B Preferred Stock [Member]
Stockholders’ equity:
Preferred stock, value	$ 0	$ 1

XML

NOTE 9 - BUSINESS COMBINATION (Details) (USD $)	3 Months Ended		0 Months Ended
	Mar. 31, 2015	Mar. 31, 2014	May 06, 2014	Mar. 11, 2015
NOTE 9 - BUSINESS COMBINATION (Details) [Line Items]
Operating Expenses	$ 2,242,305	$ 1,903,402
Customer Lists [Member] | ESC Inc. DBA ESC Software [Member] | Purchase Price Allocation, Modified [Member]
NOTE 9 - BUSINESS COMBINATION (Details) [Line Items]
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles			294,000
Customer Lists [Member] | ESC Inc. DBA ESC Software [Member]
NOTE 9 - BUSINESS COMBINATION (Details) [Line Items]
Finite-Lived Intangible Asset, Useful Life			5 years
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles			350,000
Business Combination, Acquisition Related Costs			7,500
Customer Lists [Member] | 2000 SOFT, Inc. DBA Accounting Technology Resource (ATR) [Member]
NOTE 9 - BUSINESS COMBINATION (Details) [Line Items]
Finite-Lived Intangible Asset, Useful Life				5 years
Notes Payable, Other Payables [Member] | ESC Inc. DBA ESC Software [Member]
NOTE 9 - BUSINESS COMBINATION (Details) [Line Items]
Business Combination, Consideration Transferred, Liabilities Incurred			350,000
Notes Payable, Other Payables [Member] | 2000 SOFT, Inc. DBA Accounting Technology Resource (ATR) [Member]
NOTE 9 - BUSINESS COMBINATION (Details) [Line Items]
Business Combination, Consideration Transferred, Liabilities Incurred				175,000
Payments to Acquire Intangible Assets				80,000
ESC Inc. DBA ESC Software [Member]
NOTE 9 - BUSINESS COMBINATION (Details) [Line Items]
Business Combination, Consideration Transferred, Liabilities Incurred			350,000
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles			294,000
Net Income (Loss) Attributable to Parent	37,592
Revenues	318,108
Operating Expenses	280,516
2000 SOFT, Inc. DBA Accounting Technology Resource (ATR) [Member]
NOTE 9 - BUSINESS COMBINATION (Details) [Line Items]
Business Combination, Contingent Consideration Arrangements, Description				Company will pay 10% of the net margin on maintenance renewals for former ATR customers for the first twelve months and 5% of the net margin on maintenance renewals for the following twelve months
Net Income (Loss) Attributable to Parent	4,841
Revenues	90,951
Operating Expenses	$ 86,110

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CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (USD $)	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
Cash flows from operating activities:
Net income	$ 521,167	$ 120,741
Adjustments to reconcile net income to net cash provided by operating activities
Deferred income taxes	(190,500)	24,110
Depreciation and amortization	38,207	28,330
Amortization of intangibles	73,749	49,402
Share-based compensation	30,405	11,284
Common stock issued in exchange for services	0	20,975
Changes in assets and liabilities:
Accounts receivable	(207,182)	(9,832)
Unbilled services	(288,055)	(25,000)
Prepaid expenses and other current assets	(11,278)	(62,477)
Deposits and other assets	(2,263)	0
Accounts payable	119,279	(62,031)
Accrued expenses	(103,612)	135,586
Income tax payable	215,083	0
Accrued interest	(232)	(271)
Deferred revenue	255,990	169,810
Net cash provided by operating activities	450,758	400,627
Cash flows from investing activities:
Purchase of property and equipment	(24,869)	0
Acquisition of new business	(80,000)	0
Net cash (used in) in investing activities	(104,869)	0
Cash flows from financing activities:
Repayment of long-term debt	(62,360)	(41,995)
Principal payments under capital leases obligations	(19,508)	(14,615)
Issuance of common stock and warrants, net of fees	812,023	0
Net cash provided by (used in) in financing activities	730,155	(56,610)
Net increase in cash and cash equivalents	1,076,044	344,017
Cash and cash equivalents – beginning of period	1,308,337	762,892
Cash and cash equivalents – end of period	2,384,381	1,106,909
Cash paid during period for:
Interest	13,143	4,503
Income taxes	$ 22,136	$ 27,733

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NOTE 5 - INTANGIBLE ASSETS (Details) (USD $)	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
NOTE 5 - INTANGIBLE ASSETS (Details) [Line Items]
Amortization of Intangible Assets	$ 73,749	$ 49,402
Computer Software, Intangible Asset [Member]
NOTE 5 - INTANGIBLE ASSETS (Details) [Line Items]
Finite-Lived Intangible Asset, Useful Life	5 years
Intellectual Property [Member]
NOTE 5 - INTANGIBLE ASSETS (Details) [Line Items]
Finite-Lived Intangible Asset, Useful Life	5 years

XML

NOTE 5 - INTANGIBLE ASSETS (Tables)

3 Months Ended

Mar. 31, 2015

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of Finite-Lived Intangible Assets [Table Text Block]

The components of intangible assets are as follows:

	March 31, 2015			December 31, 2014
Proprietary developed software	$	365,911		$	365,911
Intellectual property, customer list, and acquired contracts		1,243,000			988,000
Total intangible assets	$	1,608,911		$	1,353,911
Less: accumulated amortization		(618,179	)		(544,430	)
	$	990,732		$	809,481

Schedule of Finite-Lived Intangible Assets, Future Amortization Expense [Table Text Block]

The Company expects future amortization expense to be the following:

	Amortization
Balance of 2015	$	234,190
2016		321,782
2017		219,235
2018		124,175
2019		84,975
thereafter		6,375
Total	$	990,732

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NOTE 5 - INTANGIBLE ASSETS (Details) - Schedule of Finite-Lived Intangible Assets (USD $)	Mar. 31, 2015	Dec. 31, 2014
Finite-Lived Intangible Assets [Line Items]
Intangible asset, gross	$ 1,608,911	$ 1,353,911
Less: accumulated amortization	(618,179)	(544,430)
	990,732	809,481
Computer Software, Intangible Asset [Member]
Finite-Lived Intangible Assets [Line Items]
Intangible asset, gross	365,911	365,911
Intellectual property, customer list, and acquired contracts [Member]
Finite-Lived Intangible Assets [Line Items]
Intangible asset, gross	$ 1,243,000	$ 988,000

XML

NOTE 7 - CAPITAL LEASE OBLIGATIONS (Tables)

3 Months Ended

Mar. 31, 2015

Leases, Capital [Abstract]

Schedule of Future Minimum Lease Payments for Capital Leases [Table Text Block]

At March 31, 2015, future payments under capital leases are as follows:

Remainder of 2015	$	52,399
2016		47,785
2017		24,281
Total minimum lease payments		124,465
Less amounts representing interest		(11,782	)
Present value of net minimum lease payments		112,683
Less current portion		(58,103	)
Long-term capital lease obligation	$	54,580

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SUPPLEMENTAL SCHEDULE OF NON-CASH INVESTING AND FINANCING ACTIVITIES:

3 Months Ended

Mar. 31, 2015

Supplemental Cash Flow Elements [Abstract]

Cash Flow, Supplemental Disclosures [Text Block]

SUPPLEMENTAL SCHEDULE OF NON-CASH INVESTING AND FINANCING ACTIVITIES

For the three months ended March 31, 2015:

The Company acquired certain assets of ATR for a $175,000 promissory note in addition to a cash payment of $80,000.

On March 29, 2015, Mr. Meller returned his one share of Series B Preferred to the Company and the Company cancelled the certificate. On March 29, 2015, subject to shareholder approval, the Board approved the cancellation of the Series B Preferred Certificate of Designation.

For the three months ended March 31, 2014:

None

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CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (Parentheticals) (USD $)	Mar. 31, 2015	Dec. 31, 2014
Accounts receivable, allowance (in Dollars)	$ 125,000
Preferred stock, authorized	1,000,000	1,000,000
Preferred stock, par value (in Dollars per share)	$ 0.001	$ 0.001
Preferred stock, issued	0	0
Preferred stock, outstanding	0	0
Par value (in Dollars per share)	$ 0.00001	$ 0.00001
Authorized	75,000,000	75,000,000
Issued	4,331,252	3,959,064
Outstanding	4,331,252	3,959,064
Series A Preferred Stock [Member]
Preferred stock, authorized	2	2
Preferred stock, par value (in Dollars per share)	$ 0.001	$ 0.001
Preferred stock, issued	0	0
Preferred stock, outstanding	0	0
Series B Preferred Stock [Member]
Preferred stock, authorized	1	1
Preferred stock, par value (in Dollars per share)	$ 0.001	$ 0.001
Preferred stock, issued	0	1
Preferred stock, outstanding	0	1

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NOTE 10 - INCOME TAXES

3 Months Ended

Mar. 31, 2015

Income Tax Disclosure [Abstract]

Income Tax Disclosure [Text Block]

NOTE 10 - INCOME TAXES

The recognized deferred tax asset is based upon the expected utilization of its benefit from future taxable income. The Company has federal net operating loss (“NOL”) carryforwards of approximately $7,442,000 as of March 31, 2015, which is subject to limitations under Section 382 of the Internal Revenue Code. These carryforward losses are available to offset future taxable income, and begin to expire in the year 2025 to 2030. 

The foregoing amounts are management’s estimates and the actual results could differ from those estimates. Future profitability in this competitive industry depends on continually obtaining and fulfilling new profitable sales agreements and modifying products.  The inability to obtain new profitable contracts could reduce estimates of future profitability, which could affect the Company’s ability to realize the deferred tax assets.

Income tax provision (benefit):

	Three Months Ended
	March 31,		March 31,
	2015		2014
Current:
Federal	$	191,831	$	46,801
State and local		23,252		-
Total current tax provision		215,083		46,801
Deferred:
Federal		8,473		24,110
State and local		1,027		-
Release of valuation allowance		(200,000)		-
Total deferred tax provision (benefit)		(190,500)		24,110
Total provision	$	24,583		70,911

For the year three months ended March 31, 2015, the Company’s Federal and State provision requirements were calculated based on the estimated tax rate. The Federal effective rate is higher than the statutory rate primarily due to Incentive Stock Options (ISO) expense which is generally never tax deductible for the Company. The provision for the three months ended March 31, 2015 was $215,083. The effective tax rate consists primarily of the 34% federal statutory tax rate and a blended 4% state and local tax rate.

For the three months ended March 31, 2015, the Company’s Federal and State provision requirements were offset by the reversal of a portion of the valuation allowance, totaling $560,000, no longer deemed necessary, and recorded a net tax benefit of $200,000, which represents a reduction in its valuation allowance on tax attributes that are expected to be utilized based on management’s assessment and evaluation of historical and projected income.

XML

Document And Entity Information	3 Months Ended
	Mar. 31, 2015	May 05, 2015
Document and Entity Information [Abstract]
Entity Registrant Name	SilverSun Technologies, Inc.
Document Type	10-Q
Current Fiscal Year End Date	--12-31
Entity Common Stock, Shares Outstanding		4,331,252
Amendment Flag	false
Entity Central Index Key	0001236275
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Entity Filer Category	Smaller Reporting Company
Entity Well-known Seasoned Issuer	No
Document Period End Date	Mar. 31, 2015
Document Fiscal Year Focus	2015
Document Fiscal Period Focus	Q1

XML

NOTE 11 - SUBSEQUENT EVENTS

3 Months Ended

Mar. 31, 2015

Subsequent Events [Abstract]

Subsequent Events [Text Block]

NOTE 11 – SUBSEQUENT EVENTS

On April 29, 2015 the Board approved entering into a consulting agreement with Christopher Roberts IR for the provision of investor relations services.  In addition to cash payments for services, the Company issued 15,000 shares of common stock at $2.24 per share.

XML

CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited) (USD $)	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
Revenues:
Software product, net	$ 1,382,742	$ 609,970
Service, net	5,100,372	4,314,655
Total revenues, net	6,483,114	4,924,625
Cost of revenues:
Product	637,509	327,402
Service	3,045,333	2,492,179
Total cost of revenues	3,682,842	2,819,581
Gross profit	2,800,272	2,105,044
Selling, general and administrative expenses :
Selling and marketing expenses	912,130	732,275
General and administrative expenses	1,187,814	1,082,110
Share based compensation	30,405	11,284
Depreciation and amortization	111,956	77,733
Total selling, general and administrative expenses	2,242,305	1,903,402
Income from operations	557,967	201,642
Other income (expense)
Interest expense, net	(12,217)	(9,990)
Total other income (expense)	(12,217)	(9,990)
Income before taxes	545,750	191,652
Provision for income taxes	24,583	70,911
Net income	$ 521,167	$ 120,741
Net income per common share – basic and fully diluted (in Dollars per share)	$ 0.13	$ 0.03
Weighted average shares
Basic (in Shares)	4,042,317	3,930,529
Diluted (in Shares)	4,051,338	3,930,529

XML

NOTE 5 - INTANGIBLE ASSETS

3 Months Ended

Mar. 31, 2015

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Intangible Assets Disclosure [Text Block]

NOTE 5 – INTANGIBLE ASSETS

Intangible assets consist of developed intellectual property carried at cost less accumulated amortization and customer lists acquired at fair value less accumulated amortization. Amortization is computed using the straight-line method over the five year estimated useful lives.

The components of intangible assets are as follows:

	March 31, 2015			December 31, 2014
Proprietary developed software	$	365,911		$	365,911
Intellectual property, customer list, and acquired contracts		1,243,000			988,000
Total intangible assets	$	1,608,911		$	1,353,911
Less: accumulated amortization		(618,179	)		(544,430	)
	$	990,732		$	809,481

The estimated remaining useful lives for proprietary developed software is 5 years. The estimated remaining useful lives for intellectual property and customer lists is 5 years.

Amortization expense included in depreciation and amortization was $73,749 for the three months ended March 31, 2015 as compared to $49,402 for the three months ended March 31, 2014.

The Company expects future amortization expense to be the following:

	Amortization
Balance of 2015	$	234,190
2016		321,782
2017		219,235
2018		124,175
2019		84,975
thereafter		6,375
Total	$	990,732

XML

NOTE 4 - PROPERTY AND EQUIPMENT

3 Months Ended

Mar. 31, 2015

Property, Plant and Equipment [Abstract]

Property, Plant and Equipment Disclosure [Text Block]

NOTE 4 – PROPERTY AND EQUIPMENT

Property and equipment is summarized as follows:

	March 31, 2015			December 31, 2014
Leasehold improvements	$	30,557		$	30,557
Equipment, furniture and fixtures		1,200,247			1,175,378
		1,230,804			1,205,935
Less: Accumulated depreciation		(949,088	)		(910,881	)
Property and equipment, net	$	281,716		$	295,054

Depreciation and amortization expense related to these assets for the three months ended March 31, 2015 and 2014 was $38,207 and $28,330, respectively. 

Property and equipment under capital leases are summarized as follows:

	March 31, 2015			December 31, 2014
Equipment, furniture and fixtures		297,080			297,080
Less: Accumulated depreciation		(163,862	)		(143,376	)
Property and equipment, net	$	133,218		$	153,704

XML

NOTE 6 - LINE OF CREDIT AND TERM LOAN AND PROMISSORY NOTE (Tables)

3 Months Ended

Mar. 31, 2015

Line Of Credit And Term Loan [Abstract]

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

At March 31, 2015, future payments of long term debt are as follows:

Remainder of 2015	$	154,989
2016		127,427
2017		129,999
2018		87,209
2019		30,520
Total	$	530,144

XML

Accounting Policies, by Policy (Policies)

3 Months Ended

Mar. 31, 2015

Accounting Policies [Abstract]

Basis of Accounting, Policy [Policy Text Block]

Basis of Presentation

In the opinion of management, the accompanying unaudited condensed consolidated financial statements contain all adjustments necessary to present fairly the financial position of SilverSun Technologies, Inc. as of March 31, 2015, the results of operations and cash flows for the three months ended March 31, 2015 and 2014.  These results are not necessarily indicative of the results to be expected for the full year.

The financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC) and consequently have been condensed and do not include all of the disclosures normally made in an Annual Report on Form 10-K.  The December 31, 2014 balance sheet included herein was derived from the audited financial statements included in the Company’s annual report on Form 10-K as of that date. Accordingly, the financial statements included herein should be reviewed in conjunction with the financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2014 filed with the SEC on March 31, 2015.

On February 4, 2015 the Company effected the Reverse Stock Split and every thirty (30) shares of outstanding Common Stock decreased to one (1) share of Common Stock. Similarly, the number of shares of Common Stock into which each outstanding option and warrant to purchase Common Stock is to be exercisable decreased on a 1-for-30 basis and the exercise price of each outstanding option and warrant to purchase Common Stock increased proportionately. The impact of this reverse stock split has been retroactively applied to the financial statements and the related notes.

During the three months ended March 31, 2015, there have been no material changes to the Company’s significant accounting policies than those previously disclosed in the Company’s Form 10-K for the year ended December 31, 2014.

Consolidation, Policy [Policy Text Block]

Principals of Consolidation

The consolidated financial statements include the accounts of SilverSun Technologies, Inc. and subsidiary, of which is wholly owned. All significant intercompany transactions and balances have been eliminated in consolidation.

Use of Estimates, Policy [Policy Text Block]

Use of Estimates

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 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.  Actual results could differ from those estimates.

Goodwill and Intangible Assets, Goodwill, Policy [Policy Text Block]

Goodwill

Goodwill is the excess of acquisition cost of an acquired entity over the fair value of the identifiable net assets acquired.  Goodwill is not amortized, but tested for impairment annually or whenever indicators of impairment exist. These indicators may include a significant change in the business climate, legal factors, operating performance indicators, competition, sale or disposition of a significant portion of the business or other factors.

Intangible Assets, Finite-Lived, Policy [Policy Text Block]

Definite Lived Intangible Assets and Long-lived Assets

The purchased intangible assets are recorded at fair value using an independent valuation at the date of acquisition and are amortized over the useful lives of the asset using the straight-line amortization method. 

The Company assesses potential impairment of its intangible assets and other long-lived assets when there is evidence that recent events or changes in circumstances have made recovery of an asset’s carrying value unlikely. Factors the Company considers important, which may cause impairment include, among others, significant changes in the manner of use of the acquired asset, negative industry or economic trends, and significant underperformance relative to historical or projected operating results. No impairment losses were identified or recorded for the three months ended March 31, 2015 and 2014.

Revenue Recognition, Policy [Policy Text Block]

Revenue Recognition

Revenue is recognized when products are shipped, or services are rendered, evidence of a contract exists, the price is fixed or reasonably determinable, and collectability is reasonably assured.

Product Revenue

Software product revenue is recognized when the product is shipped to the customer. The Company treats the software component and the professional services consulting component as two separate arrangements that represent separate units of accounting. The arrangement consideration is allocated to each unit of accounting based upon that unit’s proportion of the fair value.  In a situation where both components are present, software sales revenue is recognized when collectability is reasonably assured and the product is delivered and has stand-alone value based upon vendor specific objective evidence.

Service Revenue

Service revenue is comprised of primarily professional service consulting revenue, maintenance revenue and other ancillary services provided. Professional service revenue is recognized as service time is incurred.

With respect to maintenance services, upon the completion of one year from the date of sale, the Company offers customers an optional annual software maintenance and support agreement for subsequent periods not exceeding one year. Maintenance and support agreements are recorded as deferred revenue and recognized over the respective terms of the agreements, which typically range from three months to one year and are included in services revenue in the Consolidated Statements of Income.

Shipping and handling costs charged to customers are classified as revenue, and the shipping and handling costs incurred are included in cost of sales.

Trade and Other Accounts Receivable, Unbilled Receivables, Policy [Policy Text Block]

Unbilled Services

The Company recognizes revenue on its professional services as those services are performed or certain obligations are met. Unbilled services represents the revenue recognized but not yet invoiced.

Revenue Recognition, Deferred Revenue [Policy Text Block]

Deferred Revenues

Deferred revenues consist of maintenance service, customer support services, including telephone support and deposits for future consulting services which will be earned as services are performed over the contractual or stated period, which generally ranges from three to twelve months.

Cash and Cash Equivalents, Policy [Policy Text Block]

Cash and Cash Equivalents

The Company considers all highly liquid investments purchased with original maturities of three months or less to be cash equivalents. The Company maintains cash balances at financial institutions that are insured by the Federal Deposit Insurance Corporation (“FDIC”) up to federally insured limits. At times balances may exceed FDIC insured limits. The Company has not experienced any losses in such accounts.

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

Concentrations

The Company maintains its cash and cash equivalents with various institutions, which exceed federally insured limits throughout the year.  At March 31, 2015 and December 31, 2014, the Company had cash on deposit of approximately $1,876,839 and $1,029,941 respectively in excess of the federally insured limits of $250,000.

For the three months ended March 31, 2015 and 2014, our top ten customers accounted for 33% ($2,124,079) and 20% ($990,367), respectively, of our total revenues.  The Company does not rely on any one specific customer for any significant portion of our revenue.

For the three months ended March 31, 2015 and 2014, purchases from one supplier through a “channel partner” agreement were approximately 42% and 45% of cost of revenues, respectively.  This channel partner agreements is for a one year term and automatically renews for an additional one year term on the anniversary of the agreements effective date.

For the three months ended March 31, 2015 and 2014, one supplier represented approximately 27% and 28% of total accounts payable respectively.

Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of trade accounts receivable and cash and cash equivalents.  As of March 31, 2015 the Company believes it has no significant risk related to its concentration of accounts receivable.

Receivables, Policy [Policy Text Block]

Accounts Receivable

Accounts receivable consist primarily of invoices for maintenance and professional services. Full payment for software ordered by customers is due in advance of ordering from the software supplier. Payments for maintenance and support plan renewals are due before the beginning of the maintenance period. Terms under our professional service agreements are generally 50% due in advance and the balance on completion of the services.

The Company maintains an allowance for bad debt estimated by considering a number of factors, including the length of time the amounts are past due, the Company’s previous loss history and the customer’s current ability to pay its obligations.

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

Property and Equipment

Property and equipment is stated at cost, net of accumulated depreciation.  Depreciation is computed using the straight-line method based upon the estimated useful lives of the assets, generally three to seven years.  Maintenance and repairs that do not materially add to the value of the equipment nor appreciably prolong its life are charged to expense as incurred.

When assets are retired or otherwise disposed of, the cost and related accumulated depreciation are removed from the accounts and the resulting gain or loss is included in the Consolidated Statements of Income.

Income Tax, Policy [Policy Text Block]

Income Taxes

Deferred income taxes reflects the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes, as well as net operating loss carryforwards. Deferred tax assets and liabilities are classified as current or non-current based on the classification of the related assets or liabilities for financial reporting, or according to the expected reversal dates of the specific temporary differences, if not related to an asset or liability for financial reporting. Valuation allowances are established against deferred tax assets if it is more likely than not that the assets will not be realized. 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 or laws is recognized in operations in the period that includes the enactment date.

The Company has federal net operating loss (“NOL”) carryforwards which are subject to limitations under Section 382 of the Internal Revenue Code.

The calculation of the Company’s tax liabilities involves dealing with uncertainties in the application of complex tax regulations. The Company recognizes liabilities for uncertain tax positions if the weight of available evidence indicates that it is more likely than not that the position will not be sustained upon a tax examination with a tax examination being presumed to occur. The Company recognizes interest and penalties as incurred in finance income (expense), net in the Consolidated Statements of Income.

There were no liabilities for uncertain tax positions at March 31, 2015 and 2014.

Reclassification, Policy [Policy Text Block]

Reclassifications

Certain prior year amounts have been reclassified to conform to the current year presentation.  The reclassifications have had no effect on the financial position, operations or cash flows for the period ended March 31, 2014.

Fair Value Measurement, Policy [Policy Text Block]

Fair Value Measurement

The accounting standards define fair value and establish a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use on unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs that market participants would use in pricing the asset or liability developed based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company’s assumptions about the assumptions market participants would use in pricing the asset or liability developed based on the best information available in the circumstances. The hierarchy is as follows:

Level 1: Quoted prices (unadjusted) in active markets that are accessible at the measurement date for assets or liabilities. The fair value hierarchy gives the highest priority to Level 1 inputs.

Level 2: Observable prices that are based on inputs not quoted on active markets, but corroborated by market data.

Level 3: Unobservable inputs are used when little or no market data is available. The fair value hierarchy gives the lowest priority to Level 3 inputs. 

The Company’s current financial assets and liabilities approximate fair value due to their short term nature and include cash, accounts receivable, accounts payable, and accrued liabilities.  The carrying value of longer term lease and debt obligations approximate fair value as their stated interest rates approximate the rates currently available.

Share-based Compensation, Option and Incentive Plans Policy [Policy Text Block]

Stock-Based Compensation

Compensation expense related to share-based transactions, including employee stock options, is measured and recognized in the financial statements based on a determination of the fair value. The grant date fair value is determined using the Black-Scholes-Merton (“Black-Scholes”) pricing model. For employee stock options, the Company recognizes expense over the requisite service period on a straight-line basis (generally the vesting period of the equity grant). The Company’s option pricing model requires the input of highly subjective assumptions, including the expected stock price volatility, expected term, and forfeiture rate. Any changes in these highly subjective assumptions significantly impact stock-based compensation expense.

New Accounting Pronouncements, Policy [Policy Text Block]

Recent Accounting Pronouncements

In May 2014, the FASB issued Accounting Standard 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. This ASU is effective for annual reporting periods beginning after December 15, 2016 and early adoption is not permitted. Accordingly, the Company will adopt this ASU on January 1, 2017. Companies may use either a full retrospective or modified retrospective approach to adopt this ASU and management is currently evaluating which transition approach to use. The Company is currently assessing the impact that adopting this new accounting guidance will have on its consolidated financial statements and footnote disclosures.  In April 2015 the FASB proposed delaying the effective date by one year for public companies.

No other recently issued accounting pronouncements had or are expected to have a material impact on the Company’s consolidated financial statements.

XML

NOTE 8 - EQUITY

3 Months Ended

Mar. 31, 2015

Disclosure Text Block Supplement [Abstract]

Shareholders' Equity and Share-based Payments [Text Block]

NOTE 8– EQUITY

Equity

In March 2015, 363,490 shares of common stock were sold at a price of $4.24 per share and 181,745 warrants were sold at a price of $.01. The gross proceeds raised was $1,543,015 and underwriting and expenses relating to the offering of $730,992, resulting in net proceeds to the Company of $812,023.

On March 29, 2015, Mr. Meller returned his one share of Series B Preferred to the Company and the Company cancelled the certificate. On March 29, 2015, subject to shareholder approval, the Board approved the cancellation of the Series B Preferred Certificate of Designation.

Options

In February 2014, the Company granted 50,000 incentive stock options with an exercise price of $4.50 per option to certain non-executive employees under the 2004 Stock Incentive Plan. Approximately 25,000 of the options vest immediately with the remaining 50% vesting ratably over a three-year period. The Company estimated the fair value of each option using the Black Scholes option-pricing model with the following weighted-average assumptions: expected dividend yield of 0.0%, risk-free interest rate of 0.71%, volatility at 353.95% and an expected life of 5 years. The Company estimates the forfeiture rate based on historical data. Based on an analysis of historical information, the Company has applied a forfeiture rate of 15%. As a result, the Company estimated the value of these options at $115,488.

In May 2014, the Company granted 20,000 incentive stock options with an exercise price of $4.50 per option to a non – executive employee under the 2004 Stock Incentive Plan. The Company recognizes compensation cost on awards on a straight-line basis over the vesting period, approximately five years. The Company estimated the fair value of each option using the Black Scholes option-pricing model with the following weighted-average assumptions: expected dividend yield of 0.0%, risk-free interest rate of 1.68%, volatility at 328.76% and an expected life of 5 years. The Company estimates the forfeiture rate based on historical data. Based on an analysis of historical information, the Company has applied a forfeiture rate of 15%. As a result, the Company estimated the value of these options at $77,981. 

In July 2014, the Company granted 10,000 incentive stock options with an exercise price of $4.50 per option to a certain non-executive employee under the 2004 Stock Incentive Plan. Options vest immediately. The Company estimated the fair value of each option using the Black Scholes option-pricing model with the following weighted-average assumptions: expected dividend yield of 0.0%, risk-free interest rate of 1.0%, volatility at 323.81% and an expected life of 5 years. As a result, the Company estimated the value of these options at $44,987.

In March 2015, the Company granted 10,000 incentive stock options with an exercise price of $4.00 per option to a certain non-executive employee under the 2004 Stock Incentive Plan. The Company recognizes compensation cost on awards on a straight-line basis over the vesting period, approximately five years. The Company estimated the fair value of each option using the Black Scholes option-pricing model with the following weighted-average assumptions: expected dividend yield of 0.0%, risk-free interest rate of 1.6%, volatility at 263.18% and an expected life of 5 years. As a result, the Company estimated the value of these options at $39,875.

The Company uses judgment in estimating the amount of stock-based awards that are expected to be forfeited. If actual forfeitures differ significantly from the original estimate, stock-based compensation expense and the results of operations could be impacted.

A summary of the status of the Company’s stock option plans for the fiscal years ended December 31, 2014 and the three months ending March 31, 2015 and changes during the years are presented below: (in number of options):

	Number of Options			Average Exercise Price		Average Remaining Contractual Term	Aggregate Intrinsic Value
Outstanding options at January 1, 2014		89,116		$	4.80	3.4 years	$	-0-
Options granted		80,000			4.50	4.3 years
Options exercised		-
Options canceled/forfeited		(5,270	)	$	4.80
Outstanding options at December 31, 2014		163,846		$	4.65	2.5 years	$	-0-
Options granted		10,000		$	4.00	4.9 years
Options exercised		-
Options canceled/forfeited		-
Outstanding options at March 31, 2015		173,846			4.62	2.9 years	$	-0-
Vested Options:
March 31, 2015;		109,321		$	2.56	1.4 years	$	-0-
December 31, 2014:		115,653		$	4.65	1.8 years	$	-0-

For the three months ended March 31, 2015 the unamortized compensation expense for stock options was $115,000.  Unamortized compensation expense is expected to be recognized over a weighted-average period of three years.

Warrants

On January 29, 2015 the Company granted 3,333 warrants with a fair value of approximately $19,969, which immediately vested, to Joseph Macaluso as part of his compensation for agreeing to join the Board of Directors. The estimated fair value of the warrant has been calculated based on a Black-Scholes pricing model using the following assumptions: a) fair market value of stock of $6.00; b) exercise price of $6.00; c) Dividend yield of 0%; d) Risk free interest rate of 1.42%; e) expected volatility of 284.28%; f) Expected life of 5 years. 

On March 9, 2015 the Company granted 18,175 warrants with a fair value of approximately $73,356, which immediately vested, to Alexander Capital, LP as partial compensation for acting as placement agent. The estimated fair value of the warrant has been calculated based on a Black-Scholes pricing model using the following assumptions: a) fair market value of stock of $4.05; b) exercise price of $5.088; c) Dividend yield of 0%; d) Risk free interest rate of 1.66%; e) expected volatility of 263.67%; f) Expected life of 5 years.

On March 23, 2015 the Company granted 181,745 warrants with a fair value of approximately $638,630, which immediately vested, to those that purchased common stock as part of the offering. The estimated fair value of the warrant has been calculated based on a Black-Scholes pricing model using the following assumptions: a) fair market value of stock of $3.53; b) exercise price of $5.30; c) Dividend yield of 0%; d) Risk free interest rate of 1.41%; e) expected volatility of 258.39%; f) Expected life of 5 years.

The following table summarizes the warrants transactions:

	Warrants Outstanding		Weighted Average Exercise Price
Balance, January 1, 2014		25,001	$	5.20
Granted		-	$	-
Exercised		8,333	$	3.60
Canceled		16,668	$	4.20
Outstanding and Exercisable December 31, 2014		-	$	-
Granted		203,252	$	5.29
Exercised		-	$	-
Canceled		-	$	-
Outstanding and Exercisable March 31, 2015		203,252	$	5.29

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NOTE 6 - LINE OF CREDIT AND TERM LOAN AND PROMISSORY NOTE

3 Months Ended

Mar. 31, 2015

Line Of Credit And Term Loan [Abstract]

Line Of Credit And Term Loan [Text Block]

NOTE 6 – LINE OF CREDIT, TERM LOAN AND PROMISSORY NOTES

On August 1, 2013, the Company obtained a line of credit and term loan from the bank. The line of credit is for two years and expires on July 31, 2015. The agreement included a borrowing base calculation tied to accounts receivable with a maximum availability of $750,000 at prime plus 1.75% interest (5% at March 31, 2015).  The line is collateralized by substantially all of the assets of the Company and guaranteed by the Company’s Chief Executive Officer, Mr. Meller.  The credit facility requires the Company to pay a monitoring fee of $1,000 monthly. At March 31, 2015, the Company was in compliance with the required financial covenants the fixed charge ratio and debt to net worth. As of March 31, 2015, the availability under this line was $750,000. 

The term loan is for $350,000 for two years and matures on July 31, 2015. Monthly payments are $15,776 including interest at 8%. The term loan is collateralized by substantially all of the assets of the Company and is guaranteed by the Company’s Chief Executive Officer, Mr. Meller.  At March 31, 2015 the outstanding balance was $61,076.

On May 6, 2014, SWK acquired certain assets of ESC, Inc. pursuant to an Asset Purchase Agreement for a promissory note in the aggregate principal amount of $350,000 (the “ESC Note”) and matures on April 1, 2019. Monthly payments are $6,135 including interest at 2% per year. At March 31, 2015 the outstanding balance was $294,068. 

On March 11, 2015, SWK acquired certain assets of 2000 SOFT, Inc. d/b/a Accounting Technology Resource (ATR) pursuant to an Asset Purchase Agreement for cash of $80,000 and a promissory note for $175,000 (the “ATR Note”). The note matures on February 1, 2018.  Monthly payments are $5,012 including interest at 2% per year. At March 31, 2015 the outstanding balance was $175,000.

At March 31, 2015, future payments of long term debt are as follows:

Remainder of 2015	$	154,989
2016		127,427
2017		129,999
2018		87,209
2019		30,520
Total	$	530,144

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NOTE 7 - CAPITAL LEASE OBLIGATIONS

3 Months Ended

Mar. 31, 2015

Leases, Capital [Abstract]

Capital Leases in Financial Statements of Lessee Disclosure [Text Block]

NOTE 7 – CAPITAL LEASE OBLIGATIONS

The Company has entered into lease commitments for equipment that meet the requirements for capitalization. The equipment has been capitalized and is included property and equipment, net in the accompanying balance sheets.  The related obligations are based upon the present value of the future minimum lease payments with interest rates ranging from 8.5% to 11.0%.

At March 31, 2015, future payments under capital leases are as follows:

Remainder of 2015	$	52,399
2016		47,785
2017		24,281
Total minimum lease payments		124,465
Less amounts representing interest		(11,782	)
Present value of net minimum lease payments		112,683
Less current portion		(58,103	)
Long-term capital lease obligation	$	54,580

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NOTE 9 - BUSINESS COMBINATION

3 Months Ended

Mar. 31, 2015

Business Combinations [Abstract]

Business Combination Disclosure [Text Block]

NOTE 9 – BUSINESS COMBINATION

On May 6, 2014 SWK entered into an Asset Purchase Agreement with ESC, Inc. d/b/a ESC Software, an Arizona corporation, and Alan H. Hardy and Michael Dobberpuhl in their individual capacity as Shareholders. SWK acquired certain assets of ESC (as defined in the Purchase Agreement). In full consideration for the acquired assets, the Company issued a promissory note in the aggregate principal amount of $350,000.   The purchase was initially allocated, based on the Company’s estimate of fair value, to intangible assets, which are expected to consist primarily of customers lists with an estimated life of five years. Upon completion of an independent valuation, the allocation of the purchase price to customer lists was modified from $350,000 to $294,000, with the excess purchase consideration being allocated to goodwill.

The following summarizes the purchase price allocation:

Customer List	$	294,000
Goodwill		56,000
Fair value of net assets acquired	$	350,000
Note to shareholders for acquisition	$	350,000
Total purchase price	$	350,000

Acquisition costs were approximately $7,500, which are included in general and administrative expenses.

On March 11, 2015 SWK entered into an Asset Purchase Agreement with 2000 SOFT, Inc. d/b/a ATR, a California corporation, and Karen Espinoza McGarrigle in her individual capacity as Shareholder. SWK acquired certain assets of ATR (as defined in the Purchase Agreement). In consideration for the acquired assets, the Company issued a promissory note in the aggregate principal amount of $175,000 and paid cash of $80,000.   As additional consideration, the Company will pay 10% of the net margin on maintenance renewals for former ATR customers for the first twelve months and 5% of the net margin on maintenance renewals for the following twelve months. The purchase was initially allocated, based on the Company’s estimate of fair value, to intangible assets, which are expected to consist primarily of customers lists with an estimated life of five years. Upon completion of an independent valuation, the allocation of the purchase price to customer lists will be modified accordingly and acquisition costs disclosed.

The following unaudited pro forma information does not purport to present what the Company’s actual results would have been had the acquisitions occurred on January 1, 2014, nor is the financial information indicative of the results of future operations. The following table represents the unaudited consolidated pro forma results of operations for the three months ended March 31, 2015 and 2014 as if the acquisition occurred on January 1, 2014. Operating expenses have been increased for the amortization expense associated with the estimated fair value adjustment as of March 31, 2015 of expected definite lived intangible assets.

Pro Forma	Three Months Ended March 31, 2015		Three Months Ended  March 31, 2014
Net sales	$	6,706,718	$	5,861,911
Operating expenses		2,312,471		2,148,915
Income  before taxes		561,336		277,360
Net income	$	531,454	$	174,737
Basic and diluted income per common share	$	0.13	$	0.10

The Company’s condensed consolidated financial statements for the three months ending March 31, 2015 include the actual results of ESC since the date of acquisition, May 6, 2014 and the actual results of ATR since the date of acquisition, March 11, 2015. The three months ended March 31, 2015 pro-forma results above include two months of results of ATR and for the period ended March 31, 2014 pro-forma results above include three months of pro-forma results for both ESC and ATR. For the three months ended March 31, 2015 the ESC operations had a net income before taxes of $37,592 that was included in the Company’s Condensed Consolidated Statement of Income, which consisted of approximately $318,108 in revenues and $280,516 in expenses.  For the three months ended March 31, 2015 the ATR operations had a net income before taxes of $4,841 that was included in the Company’s Condensed Consolidated Statement of Income, which consisted of approximately $90,951 in revenues and $86,110 in expenses.

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NOTE 4 - PROPERTY AND EQUIPMENT (Details) - Schedule of Capital Leased Assets (USD $)	Mar. 31, 2015	Dec. 31, 2014
Schedule of Capital Leased Assets [Abstract]
Equipment, furniture and fixtures	$ 297,080	$ 297,080
Less: Accumulated depreciation	(163,862)	(143,376)
Property and equipment, net	$ 133,218	$ 153,704

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NOTE 4 - PROPERTY AND EQUIPMENT (Tables)

3 Months Ended

Mar. 31, 2015

Property, Plant and Equipment [Abstract]

Property, Plant and Equipment [Table Text Block]

Property and equipment is summarized as follows:

	March 31, 2015			December 31, 2014
Leasehold improvements	$	30,557		$	30,557
Equipment, furniture and fixtures		1,200,247			1,175,378
		1,230,804			1,205,935
Less: Accumulated depreciation		(949,088	)		(910,881	)
Property and equipment, net	$	281,716		$	295,054

Schedule of Capital Leased Assets [Table Text Block]

Property and equipment under capital leases are summarized as follows:

	March 31, 2015			December 31, 2014
Equipment, furniture and fixtures		297,080			297,080
Less: Accumulated depreciation		(163,862	)		(143,376	)
Property and equipment, net	$	133,218		$	153,704

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NOTE 9 - BUSINESS COMBINATION (Tables)

3 Months Ended

Mar. 31, 2015

Business Combinations [Abstract]

Schedule of Recognized Identified Assets Acquired and Liabilities Assumed [Table Text Block]

The following summarizes the purchase price allocation:

Customer List	$	294,000
Goodwill		56,000
Fair value of net assets acquired	$	350,000
Note to shareholders for acquisition	$	350,000
Total purchase price	$	350,000

Business Acquisition, Pro Forma Information [Table Text Block]

The following unaudited pro forma information does not purport to present what the Company’s actual results would have been had the acquisitions occurred on January 1, 2014, nor is the financial information indicative of the results of future operations.

Pro Forma	Three Months Ended March 31, 2015		Three Months Ended  March 31, 2014
Net sales	$	6,706,718	$	5,861,911
Operating expenses		2,312,471		2,148,915
Income  before taxes		561,336		277,360
Net income	$	531,454	$	174,737
Basic and diluted income per common share	$	0.13	$	0.10

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NOTE 10 - INCOME TAXES (Details) - Schedule of Components of Income Tax Expense (Benefit) (USD $)	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
Current:
Federal	$ 191,831	$ 46,801
State and local	23,252	0
Total current tax provision	215,083	46,801
Deferred:
Federal	8,473	24,110
State and local	1,027	0
Release of valuation allowance	(200,000)	0
Total deferred tax provision (benefit)	(190,500)	24,110
Total provision	$ 24,583	$ 70,911

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NOTE 7 - CAPITAL LEASE OBLIGATIONS (Details) - Schedule of Future Minimum Lease Payments for Capital Leases (USD $)	Mar. 31, 2015	Dec. 31, 2014
Schedule of Future Minimum Lease Payments for Capital Leases [Abstract]
Remainder of 2015	$ 52,399
2016	47,785
2017	24,281
Total minimum lease payments	124,465
Less amounts representing interest	(11,782)
Present value of net minimum lease payments	112,683
Less current portion	(58,103)	(65,269)
Long-term capital lease obligation	$ 54,580	$ 66,922

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CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT) (USD $)	Series A Preferred Stock [Member]	Series B Preferred Stock [Member]	Common Class A [Member]	Additional Paid-in Capital [Member]	Retained Earnings [Member]	Total
Balance at Dec. 31, 2013	$ 0	$ 1	$ 39	$ 10,809,499	$ (11,209,378)	$ (399,839)
Balance (in Shares) at Dec. 31, 2013	0	1	3,922,566
Common stock issued in a cashless exercise of warrants				(1)		(1)
Common stock issued in a cashless exercise of warrants (in Shares)			4,167
Issuance of common stock for repayment of accrued liabilities				20,792		20,792
Issuance of common stock for repayment of accrued liabilities (in Shares)			5,331
Share-Based Compensation				130,253		130,253
Issuance of common stock for services			1	69,500		69,501
Issuance of common stock for services (in Shares)			27,000
Net income (loss)					192,901	192,901
Balance at Dec. 31, 2014	0	1	40	11,030,043	(11,016,477)	13,607
Balance (in Shares) at Dec. 31, 2014	0	1	3,959,064
Cancellation of preferred share		(1)		1
Cancellation of preferred share (in Shares)		(1)
Issuance of common stock, net of fees			4	812,019		812,023
Issuance of common stock, net of fees (in Shares)			363,490			363,490
Roundup of fractional shares (in Shares)			8,698
Share-Based Compensation				30,405		30,405
Net income (loss)					521,167	521,167
Balance at Mar. 31, 2015	$ 0	$ 0	$ 44	$ 11,872,468	$ (10,495,310)	$ 1,377,202
Balance (in Shares) at Mar. 31, 2015	0	0	4,331,252

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NOTE 3 - NET INCOME PER COMMON SHARE

3 Months Ended

Mar. 31, 2015

Earnings Per Share [Abstract]

Earnings Per Share [Text Block]

NOTE 3 – NET INCOME PER COMMON SHARE

The Company’s basic income per common share is based on net income for the relevant period, divided by the weighted average number of common shares outstanding during the period.  Diluted income per common share is based on net income, divided by the weighted average number of common shares outstanding during the period, including common share equivalents, such as outstanding option and warrants. The computation of diluted income per share for the three months ended March 31, 2015 does not include share equivalents as all warrants and options exceeded the average market price of the common stock for the three months ended March 31, 2015.

	Three Months Ended		Three Months  Ended
	March 31, 2015		March 31, 2014
Basic net income per share computation:
Net income	$	521,167	$	120,741
Weighted-average common shares outstanding		4,042,317		3,930,529
Basic net income per share	$	0.13	$	0.03
Diluted net income per share computation:
Net income	$	521,167	$	120,741
Weighted-average common shares outstanding		4,051,338		3,930,529
Total adjusted weighted-average shares		4,051,338		3,930,529
Diluted net income per share	$	0.13	$	0.03

The following table summarizes securities that, if exercised, would have an anti-dilutive effect on earnings per share.

	Three Months March 31, 2015		Three Months March 31, 2014
Stock options		30,000		86,241
Warrants		185,078		25,000
Total potential dilutive securities not included in income per share		215,078		111,241

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NOTE 10 - INCOME TAXES (Tables)

3 Months Ended

Mar. 31, 2015

Income Tax Disclosure [Abstract]

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

Income tax provision (benefit):

	Three Months Ended
	March 31,		March 31,
	2015		2014
Current:
Federal	$	191,831	$	46,801
State and local		23,252		-
Total current tax provision		215,083		46,801
Deferred:
Federal		8,473		24,110
State and local		1,027		-
Release of valuation allowance		(200,000)		-
Total deferred tax provision (benefit)		(190,500)		24,110
Total provision	$	24,583		70,911

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NOTE 6 - LINE OF CREDIT AND TERM LOAN AND PROMISSORY NOTE (Details) (USD $)	3 Months Ended	0 Months Ended
	Mar. 31, 2015	May 06, 2014	Mar. 11, 2015	Aug. 01, 2013
NOTE 6 - LINE OF CREDIT AND TERM LOAN AND PROMISSORY NOTE (Details) [Line Items]
Long-term Debt	$ 61,076
Notes Payable to Banks [Member]
NOTE 6 - LINE OF CREDIT AND TERM LOAN AND PROMISSORY NOTE (Details) [Line Items]
Debt Instrument, Term	2 years
Debt Instrument, Collateral	The term loan is collateralized by substantially all of the assets of the Company and is guaranteed by the Company’s Chief Executive Officer, Mr. Meller.
Debt Instrument, Face Amount	350,000
Debt Instrument, Maturity Date	Jul. 31, 2015
Debt Instrument, Frequency of Periodic Payment	Monthly
Debt Instrument, Periodic Payment	15,776
Debt Instrument, Interest Rate, Stated Percentage	8.00%
Notes Payable, Other Payables [Member] | ESC Inc. DBA ESC Software [Member]
NOTE 6 - LINE OF CREDIT AND TERM LOAN AND PROMISSORY NOTE (Details) [Line Items]
Debt Instrument, Face Amount		350,000
Debt Instrument, Maturity Date		Apr. 01, 2019
Debt Instrument, Periodic Payment		6,135
Debt Instrument, Interest Rate, Stated Percentage		2.00%
Long-term Debt	294,068
Notes Payable, Other Payables [Member] | 2000 SOFT, Inc. DBA Accounting Technology Resource (ATR) [Member]
NOTE 6 - LINE OF CREDIT AND TERM LOAN AND PROMISSORY NOTE (Details) [Line Items]
Debt Instrument, Face Amount			175,000
Debt Instrument, Maturity Date			Feb. 01, 2018
Debt Instrument, Frequency of Periodic Payment			Monthly
Debt Instrument, Periodic Payment			5,012
Debt Instrument, Interest Rate, Stated Percentage			2.00%
Long-term Debt	175,000
Payments to Acquire Intangible Assets			80,000
Line of Credit [Member] | Prime Rate [Member]
NOTE 6 - LINE OF CREDIT AND TERM LOAN AND PROMISSORY NOTE (Details) [Line Items]
Debt Instrument, Basis Spread on Variable Rate				1.75%
Line of Credit [Member]
NOTE 6 - LINE OF CREDIT AND TERM LOAN AND PROMISSORY NOTE (Details) [Line Items]
Debt Instrument, Term				2 years
Line of Credit Facility, Expiration Date				Jul. 31, 2015
Line of Credit Facility, Maximum Borrowing Capacity				750,000
Line of Credit Facility, Interest Rate at Period End	5.00%
Debt Instrument, Collateral				The line is collateralized by substantially all of the assets of the Company and guaranteed by the Company’s Chief Executive Officer, Mr. Meller.
Debt Instrument, Fee				monitoring fee
Debt Instrument, Fee Amount				1,000
Debt Instrument, Frequency of Fee				monthly
Line of Credit Facility, Remaining Borrowing Capacity	$ 750,000

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NOTE 3 - NET INCOME PER COMMON SHARE (Tables)

3 Months Ended

Mar. 31, 2015

Earnings Per Share [Abstract]

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

The Company’s basic income per common share is based on net income for the relevant period, divided by the weighted average number of common shares outstanding during the period. Diluted income per common share is based on net income, divided by the weighted average number of common shares outstanding during the period, including common share equivalents, such as outstanding option and warrants. The computation of diluted income per share for the three months ended March 31, 2015 does not include share equivalents as all warrants and options exceeded the average market price of the common stock for the three months ended March 31, 2015.

	Three Months Ended		Three Months  Ended
	March 31, 2015		March 31, 2014
Basic net income per share computation:
Net income	$	521,167	$	120,741
Weighted-average common shares outstanding		4,042,317		3,930,529
Basic net income per share	$	0.13	$	0.03
Diluted net income per share computation:
Net income	$	521,167	$	120,741
Weighted-average common shares outstanding		4,051,338		3,930,529
Total adjusted weighted-average shares		4,051,338		3,930,529
Diluted net income per share	$	0.13	$	0.03

Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share [Table Text Block]

The following table summarizes securities that, if exercised, would have an anti-dilutive effect on earnings per share.

	Three Months March 31, 2015		Three Months March 31, 2014
Stock options		30,000		86,241
Warrants		185,078		25,000
Total potential dilutive securities not included in income per share		215,078		111,241