NOTE 13 - INCOME TAXES (Tables)

12 Months Ended

Dec. 31, 2013

Income Tax Disclosure [Abstract]

Components of income (loss) before taxes

	Year Ended Dec. 31,
(in thousands)	2013	2012
U.S. operations	($2,270)	($6,484)
Foreign operations	(314)	(272)
Total income (loss) before taxes	($2,584)	($6,756)

Schedule of Components of Income Tax Expense (Benefit)

(in thousands)	Year Ended Dec. 31,
Current tax expense (benefit)	2013	2012
U.S. federal	$0	($8)
State	8	(19)
Foreign	(16)	(300)
	(8)	(327)
Deferred tax expense (benefit) – U.S. federal	-	-
Total income tax expense (benefit)	($8)	($327)

Schedule of Effective Income Tax Rate Reconciliation

	Year Ended Dec. 31,
	2013	2012
(in thousands)
Statutory tax	($879)	($1,937)
State and foreign income tax, net of
federal income tax benefit	(125)	(324)
Valuation allowance for deferred tax assets	996	1,934
Total income tax expense (benefit)	($8)	($327)

Schedule of Deferred Tax Assets and Liabilities

	Year Ended December 31,
	2013	2012
(in thousands)
Deferred income tax assets:
Allowance for doubtful accounts	$25	$25
Inventory and product return reserves	746	786
Compensation accruals	1,341	1,116
Accrued liabilities	28	(105)
Book-over-tax depreciation and amortization	1,021	1,064
Foreign net operating loss carryforwards	999	800
U.S. net operating loss carryforwards	6,739	6,054
U.S. credit carryforwards	1,142	951
	12,041	10,691
Valuation Allowance	(12,041)	(10,691)
Total Deferred Income Tax Assets	$ -	$ -

Schedule of Unrecognized Tax Benefits

	Year Ended Dec. 31,
	2013	2012
(in thousands)
Unrecognized tax benefits, opening balance	$132	$113
Prior period tax position increases	23	19
Additions based on tax positions related to current year	25	-
Unrecognized tax benefits, ending balance	$180	$132