SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)

9 Months Ended

Sep. 30, 2013

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Effects of the voluntary change in accounting principle for sales commissions related to non-cancellable SaaS contracts on Consolidated Statements of Operations, Consolidated Balance Sheet, Consolidated Statement of Cash Flows and Consolidated Statement of Comprehensive Loss

The following tables present the effects of the retrospective application of the voluntary change in accounting principle for sales commissions related to non-cancellable SaaS contracts for all periods presented, effective as of January 1, 2012 (in thousands):

Consolidated Balance Sheet (in thousands)

	September 30, 2013									December 31, 2012
	Computed under Prior Method			Impact of Commission Adjustment			As Reported			As Previously Reported			Impact of Commission Adjustment			As Adjusted
Prepaid expenses and other current assets	$	6,457		$	3,934		$	10,391		$	5,204		$	3,447		$	8,651
Deferred income taxes (current)	$	141		$	(62	)	$	79		$	79		$	(49	)	$	30
Total current assets	$	173,809		$	3,872		$	177,681		$	211,177		$	3,398		$	214,575
Other assets	$	3,060		$	165		$	3,225		$	1,484		$	196		$	1,680
Deferred income taxes (non-current)	$	221		$	(3	)	$	218		$	260		$	(3	)	$	257
Total assets	$	274,892		$	4,034		$	278,926		$	275,855		$	3,591		$	279,446
Accumulated loss	$	(29,478	)	$	4,034		$	(25,444	)	$	(16,749	)	$	3,591		$	(13,158	)
Total stockholders’ equity	$	139,219		$	4,034		$	143,253		$	144,603		$	3,591		$	148,194
Total liabilities and stockholders’ equity	$	274,892		$	4,034		$	278,926		$	275,855		$	3,591		$	279,446

Consolidated Statement of Operations (in thousands, except per share data)

	Three Months Ended March 31, 2012
	As Previously Reported			Impact of Commission Adjustment			As Adjusted
Sales and marketing	$	38,404		$	166		$	38,570
Loss from operations	$	(2,359	)	$	(166	)	$	(2,525	)
Income tax provision (benefit)	$	(742	)	$	(66	)	$	(808	)
Net loss	$	(1,903	)	$	(100	)	$	(2,003	)
Basic net loss per share	$	(0.09	)	$	(0.01	)	$	(0.10	)
Diluted net loss per share	$	(0.09	)	$	(0.01	)	$	(0.10	)
Shares used in computing basic net loss per share	20,942			—			20,942
Shares used in computing diluted net loss per share	20,942			—			20,942

	Three Months Ended June 30, 2012									Six Months Ended June 30, 2012
	As Previously Reported			Impact of Commission Adjustment			As Adjusted			As Previously Reported			Impact of Commission Adjustment			As Adjusted
Sales and marketing	$	35,125		$	(6	)	$	35,119		$	73,529		$	160		$	73,689
Loss from operations	$	(5,045	)	$	6		$	(5,039	)	$	(7,404	)	$	(160	)	$	(7,564	)
Income tax provision (benefit)	$	(160	)	$	16		$	(144	)	$	(902	)	$	(50	)	$	(952	)
Net loss	$	(4,544	)	$	(10	)	$	(4,554	)	$	(6,447	)	$	(110	)	$	(6,557	)
Basic net loss per share	$	(0.22	)	$	0.00		$	(0.22	)	$	(0.31	)	$	—		$	(0.31	)
Diluted net loss per share	$	(0.22	)	$	0.00		$	(0.22	)	$	(0.31	)	$	—		$	(0.31	)
Shares used in computing basic net loss per share	20,995			—			20,995			20,969			—			20,969
Shares used in computing diluted net loss per share	20,995			—			20,995			20,969			—			20,969

Consolidated Statement of Operations (in thousands, except per share data), continued

	Three Months Ended September 30, 2012									Nine Months Ended September 30, 2012
	As Previously Reported			Impact of Commission Adjustment			As Adjusted			As Previously Reported			Impact of Commission Adjustment			As Adjusted
Sales and marketing	$	37,113		$	(283	)	$	36,830		$	110,641		$	(123	)	$	110,518
Loss from operations	$	(3,670	)	$	283		$	(3,387	)	$	(11,074	)	$	123		$	(10,951	)
Income tax provision (benefit) (1)	$	29,735		$	(1,044	)	$	28,691		$	28,833		$	(1,094	)	$	27,739
Net loss	$	(33,390	)	$	1,327		$	(32,063	)	$	(39,837	)	$	1,217		$	(38,620	)
Basic net loss per share	$	(1.58	)	$	0.06		$	(1.52	)	$	(1.90	)	$	0.06		$	(1.84	)
Diluted net loss per share	$	(1.58	)	$	0.06		$	(1.52	)	$	(1.90	)	$	0.06		$	(1.84	)
Shares used in computing basic net loss per share	21,073			—			21,073			21,004			—			21,004
Shares used in computing diluted net loss per share	21,073			—			21,073			21,004			—			21,004

(1) During the third quarter of 2012 the Company established a full valuation allowance to reduce the deferred tax assets of its operations in Brazil, Japan and the U.S.  The amount of the valuation allowance recorded in the third quarter of 2012 would have been reduced by the amount of the deferred tax liability arising from the deferred commission asset had commissions expense been accounted for under the as adjusted policy which resulted in the $1.0 million and $1.1 million income tax benefit shown as the adjustment for the three and nine month periods ended September 30, 2012, respectively.

	Three Months Ended March 31, 2013
	As Previously Reported			Impact of Commission Adjustment			As Adjusted
Sales and marketing	$	37,060		$	213		$	37,273
Loss from operations	$	(4,138	)	$	(213	)	$	(4,351	)
Income tax provision (benefit)	$	977		$	(9	)	$	968
Net loss	$	(4,700	)	$	(204	)	$	(4,904	)
Basic net loss per share	$	(0.22	)	$	(0.01	)	$	(0.23	)
Diluted net loss per share	$	(0.22	)	$	(0.01	)	$	(0.23	)
Shares used in computing basic net loss per share	21,360			—			21,360
Shares used in computing diluted net loss per share	21,360			—			21,360

	Three Months Ended June 30, 2013									Six Months Ended June 30, 2013
	As Previously Reported			Impact of Commission Adjustment			As Adjusted			As Previously Reported			Impact of Commission Adjustment			As Adjusted
Sales and marketing	$	33,144		$	(357	)	$	32,787		$	70,203		$	(144	)	$	70,059
Loss from operations	$	(3,991	)	$	357		$	(3,634	)	$	(8,130	)	$	144		$	(7,986	)
Income tax provision (benefit)	$	(400	)	$	13		$	(387	)	$	576		$	4		$	580
Net loss	$	(3,557	)	$	344		$	(3,213	)	$	(8,257	)	$	140		$	(8,117	)
Basic net loss per share	$	(0.16	)	$	0.01		$	(0.15	)	$	(0.38	)	$	—		$	(0.38	)
Diluted net loss per share	$	(0.16	)	$	0.01		$	(0.15	)	$	(0.38	)	$	—		$	(0.38	)
Shares used in computing basic net loss per share	21,569			—			21,569			21,465			—			21,465
Shares used in computing diluted net loss per share	21,569			—			21,569			21,465			—			21,465

Consolidated Statement of Operations (in thousands, except per share data), continued

	Three Months Ended September 30, 2013									Nine Months Ended September 30, 2013
	Computed under Prior Method			Impact of Commission Adjustment			As Adjusted			Computed under Prior Method			Impact of Commission Adjustment			As Adjusted
Sales and marketing	$	35,156		$	(312	)	$	34,844		$	105,360		$	(456	)	$	104,904
Loss from operations	$	(7,819	)	$	312		$	(7,507	)	$	(15,950	)	$	456		$	(15,494	)
Income tax provision (benefit)	$	(3,640	)	$	9		$	(3,631	)	$	(3,065	)	$	13		$	(3,052	)
Net loss	$	(4,472	)	$	303		$	(4,169	)	$	(12,729	)	$	443		$	(12,286	)
Basic net loss per share	$	(0.20	)	$	0.01		$	(0.19	)	$	(0.59	)	$	0.02		$	(0.57	)
Diluted net loss per share	$	(0.20	)	$	0.01		$	(0.19	)	$	(0.59	)	$	0.02		$	(0.57	)
Shares used in computing basic net loss per share	21,827			—			21,827			21,587			—			21,587
Shares used in computing diluted net loss per share	21,827			—			21,827			21,587			—			21,587

Consolidated Statement of Comprehensive Loss (in thousands)

	Three Months Ended March 31, 2012
	As Previously Reported			Impact of Commission Adjustment			As Adjusted
Net loss	$	(1,903	)	$	(100	)	$	(2,003	)
Other comprehensive income (loss)	$	(1,601	)	$	(100	)	$	(1,701	)
	Three Months Ended June 30, 2012									Six Months Ended June 30, 2012
	As Previously Reported			Impact of Commission Adjustment			As Adjusted			As Previously Reported			Impact of Commission Adjustment			As Adjusted
Net loss	$	(4,544	)	$	(10	)	$	(4,554	)	$	(6,447	)	$	(110	)	$	(6,557	)
Other comprehensive income (loss)	$	(4,853	)	$	(10	)	$	(4,863	)	$	(6,454	)	$	(110	)	$	(6,564	)
	Three Months Ended September 30, 2012									Nine Months Ended September 30, 2012
	As Previously Reported			Impact of Commission Adjustment			As Adjusted			As Previously Reported			Impact of Commission Adjustment			As Adjusted
Net loss	$	(33,390	)	$	1,327		$	(32,063	)	$	(39,837	)	$	1,217		$	(38,620	)
Other comprehensive income (loss)	$	(33,155	)	$	1,327		$	(31,828	)	$	(39,609	)	$	1,217		$	(38,392	)

	Three Months Ended March 31, 2013
	As Previously Reported			Impact of Commission Adjustment			As Adjusted
Net loss	$	(4,700	)	$	(204	)	$	(4,904	)
Other comprehensive income (loss)	$	(5,181	)	$	(204	)	$	(5,385	)
	Three Months Ended June 30, 2013									Six Months Ended June 30, 2013
	As Previously Reported			Impact of Commission Adjustment			As Adjusted			As Previously Reported			Impact of Commission Adjustment		As Adjusted
Net loss	$	(3,557	)	$	344		$	(3,213	)	$	(8,257	)	$	140	$	(8,117	)
Other comprehensive income (loss)	$	(3,437	)	$	344		$	(3,093	)	$	(8,618	)	$	140	$	(8,478	)
	Three Months Ended September 30, 2013									Nine Months Ended September 30, 2013
	Computed under Prior Method			Impact of Commission Adjustment			As Adjusted			Computed under Prior Method			Impact of Commission Adjustment		As Adjusted
Net loss	$	(4,472	)	$	303		$	(4,169	)	$	(12,729	)	$	443	$	(12,286	)
Other comprehensive income (loss)	$	(4,099	)	$	303		$	(3,796	)	$	(12,717	)	$	443	$	(12,274	)

Consolidated Statement of Cash Flows (in thousands)

	Three Months Ended March 31, 2012
	As Previously Reported			Impact of Commission Adjustment			As Adjusted
Net loss	$	(1,903	)	$	(100	)	$	(2,003	)
Deferred income tax provision (benefit)	$	(1,314	)	$	(66	)	$	(1,380	)
Prepaid expenses and other current assets	$	503		$	118		$	621
Other assets	$	(1,209	)	$	48		$	(1,161	)
Net cash provided by (used in) operating activities	$	2,656		$	—		$	2,656

	Six Months Ended June 30, 2012
	As Previously Reported			Impact of Commission Adjustment			As Adjusted
Net loss	$	(6,447	)	$	(110	)	$	(6,557	)
Deferred income tax provision (benefit)	$	(1,156	)	$	(50	)	$	(1,206	)
Prepaid expenses and other current assets	$	649		$	140		$	789
Other assets	$	(1,065	)	$	20		$	(1,045	)
Net cash provided by (used in) operating activities	$	6,068		$	—		$	6,068

	Nine Months Ended September 30, 2012
	As Previously Reported			Impact of Commission Adjustment			As Adjusted
Net loss	$	(39,837	)	$	1,217		$	(38,620	)
Deferred income tax provision (benefit)	$	26,940		$	(1,094	)	$	25,846
Prepaid expenses and other current assets	$	785		$	(123	)	$	662
Other assets	$	(78	)	$	—		$	(78	)
Net cash provided by (used in) operating activities	$	11,492		$	—		$	11,492

Consolidated Statement of Cash Flows (in thousands)

	Three Months Ended March 31, 2013
	As Previously Reported			Impact of Commission Adjustment			As Adjusted
Net loss	$	(4,700	)	$	(204	)	$	(4,904	)
Deferred income tax provision (benefit)	$	298		$	(9	)	$	289
Prepaid expenses and other current assets	$	(2,559	)	$	113		$	(2,446	)
Other assets	$	5		$	100		$	105
Net cash provided by (used in) operating activities	$	(5,635	)	$	—		$	(5,635	)

	Six Months Ended June 30, 2013
	As Previously Reported			Impact of Commission Adjustment			As Adjusted
Net loss	$	(8,257	)	$	140		$	(8,117	)
Deferred income tax provision (benefit)	$	(627	)	$	4		$	(623	)
Prepaid expenses and other current assets	$	(2,568	)	$	(176	)	$	(2,744	)
Other assets	$	10		$	32		$	42
Net cash provided by (used in) operating activities	$	(3,147	)	$	—		$	(3,147	)

	Nine Months Ended September 30, 2013
	Computed under Prior Method			Impact of Commission Adjustment			As Adjusted
Net loss	$	(12,729	)	$	443		$	(12,286	)
Deferred income tax provision (benefit)	$	(4,539	)	$	12		$	(4,527	)
Prepaid expenses and other current assets	$	(1,106	)	$	(487	)	$	(1,593	)
Other assets	$	(1,694	)	$	32		$	(1,662	)
Net cash provided by (used in) operating activities	$	(3,734	)	$	—		$	(3,734	)

Summary of the opening balances to the closing balances of the contingent purchase consideration

See table below for a summary of the opening balances to the closing balances of the contingent purchase consideration (in thousands):

	As of September 30,
	2013		2012
Contingent purchase price accrual, beginning of period	$	—	$	300
Minimum revenue target met, increase in contingent liability charged to expense in the period	—		—
Payment of contingent purchase liability	—		—
Contingent purchase price accrual, end of period	$	—	$	300

Summary of the company's financial instruments accounted for at fair value on a recurring basis

See table below for a summary of the Company’s financial instruments accounted for at fair value on a recurring basis, which consist only of short-term investments that are marked to fair value at each balance sheet date, as well as the fair value of the accrual for the contingent purchase price of the acquisition of SGLC in 2009 (in thousands):

	Fair Value as of September 30, 2013 using:								Fair Value as of September 30, 2012 using:
			Quoted Prices								Quoted Prices
			in Active								in Active
			Markets for				Significant				Markets for				Significant
			Identical		Significant Other		Unobservable				Identical		Significant Other		Unobservable
	September 30,		Assets		Observable Inputs		Inputs		September 30,		Assets		Observable Inputs		Inputs
	2013		(Level 1)		(Level 2)		(Level 3)		2012		(Level 1)		(Level 2)		(Level 3)
Assets:
Short-term investments	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Total	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Liabilities:
Contingent purchase price accrual	$	—	$	—	$	—	$	—	$	300	$	—	$	—	$	300
Total	$	—	$	—	$	—	$	—	$	300	$	—	$	—	$	300

Schedule of assumptions used to calculate the fair value of options granted using the Black-Scholes option pricing model

	Nine Months Ended
	September 30,
	2013	2012
Expected stock price volatility	64.4% - 68.0%	65.0% - 66.1%
Expected term of options	6 years	6 years
Expected dividend yield	—	—
Risk-free interest rate	0.75% - 1.65%	0.60% - 0.88%

Schedule of stock-based compensation expense

The following table presents stock-based compensation expense included in the related financial statement line items (dollars in thousands):

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2013		2012		2013		2012
Cost of revenue	$	86	$	64	$	108	$	225
Sales and marketing	669		320		1,067		753
Research & development	348		338		971		1,243
General and administrative	1,422		1,755		4,083		3,987
Total	$	2,525	$	2,477	$	6,229	$	6,208

Schedule of total comprehensive income (loss)

The following table presents the effect of exchange rate changes and the net unrealized gains and losses from the available-for-sale securities on total comprehensive income (loss) (dollars in thousands):

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2013			2012			2013			2012
				(As Adjusted)*						(As Adjusted)*
Net Loss	$	(4,169	)	$	(32,063	)	$	(12,286	)	$	(38,620	)
Foreign currency translation gain (loss)	373			230			12			205
Unrealized gain on available-for-sale securities	—			5			—			23
Total comprehensive loss	$	(3,796	)	$	(31,828	)	$	(12,274	)	$	(38,392	)

* Certain amounts have been adjusted for the retrospective change in accounting principle for sales commissions (See Note 2).