DESCRIPTION OF BUSINESS AND MERGER OF PRESCIENT APPLIED INTELLIGENCE, INC.	12 Months Ended
Jun. 30, 2013
Notes to Financial Statements
NOTE 1 - DESCRIPTION OF BUSINESS AND MERGER OF PRESCIENT APPLIED INTELLIGENCE, INC.	Summary of Business Park City Group, Inc. (the “Company”) is incorporated in the state of Nevada. The Company’s 98.76% and 100% owned subsidiaries, Park City Group, Inc. and Prescient Applied Intelligence, Inc. (“Prescient”), respectively, are incorporated in the state of Delaware. All intercompany transactions and balances have been eliminated in consolidation. The Company designs, develops, markets and supports proprietary software products. These products are designed for businesses having multiple locations to assist in the management of business operations on a daily basis and communicate results of operations in a timely manner. In addition, the Company has built a consulting practice for business improvement that centers on the Company’s proprietary software products. The principal markets for the Company's products are multi-store retail and convenience store chains, branded food manufacturers, suppliers and distributors, and manufacturing companies, which have operations in North America, Europe, Asia and the Pacific Rim. Recent Developments CVS Pharmacy, Inc. On July 31, 2012, the Company announced a three-year service agreement to provide selected scan-based trading services to CVS Pharmacy, Inc. (“CVS”) through May 2015. The agreement reflects the Company's focus on increasing the number of retailers that use its software on a subscription basis, and marks the Company's progress towards contracting with major retailers outside of the grocery industry. In addition to the agreement with CVS, the Company initiated test programs to provide services to two large national retailers with upwards of 12,000 stores combined nationwide. The Company expects the subscription revenue potential generated from these relationships to be significantly larger than any of the Company's existing client hubs within the grocery industry. Stock Repurchase Program On September 4, 2012, the Company announced that its Board of Directors had approved a share repurchase program (the "Repurchase Program") of up to $2.0 million of the Company's common stock over the next two years, or such other date, which ever is earlier, when the Repurchase Program is revoked or varied by the Board of Directors. The Repurchase Program does not obligate the Company to acquire any particular number of shares of common stock. The Repurchase Program may be suspended, modified or discontinued at any time at the Company's discretion without prior notice. Series A Redemption On March 15, 2013, the Company called for the redemption of all outstanding shares of its Series A Convertible Preferred Stock (“Series A Preferred”), pursuant to the Certificate of Designation of the Relative Rights, Powers and Preference of the Series A Preferred (the “Certificate of Designation”), which allowed the Company to, upon 30 days written notice, redeem all issued and outstanding shares of Series A Preferred for $10.00 per share (the “Series A Preferred Redemption”). Holders of Series A Preferred could also elect to convert, rather than redeem, their shares of Series A Preferred into 3.33 shares of common stock, at $3.00 per share. The Company completed the Series A Preferred Redemption on April 15, 2013. All but one holder of Series A Preferred elected to convert their shares of Series A Preferred into shares of the Company’s common stock. Series A Private Offering In March 2013, the Company issued an aggregate total of 756,858 shares of its common stock for $3.50 per share, and five year warrants (the “Investor Warrant(s)”) to purchase an aggregate total of 249,763 shares of common stock for $3.50 per share to certain accredited investors (the “Investors”) in a series of private transactions (the “Private Offering”) in order to finance the Series A Preferred Redemption. The Company also issued warrants to certain affiliates of the placement agent for three of the Investors, on substantially similar terms to those offered to the Investors (“Placement Agent Warrant(s)”), to purchase 18,857 shares of common stock as partial consideration for facilitating a portion of the Private Offering. The Company also entered into a Registration Rights Agreement with certain investors, wherein the Company agreed to register the shares of common stock, Investor Warrants and Placement Agent Warrants with the Securities and Exchange Commission (the “SEC”). In accordance with this Registration Rights Agreement, the Company filed a registration statement on Form S-3 with the SEC on April 15, 2013. The registration statement was declared effective by the SEC on May 15, 2013. Director Investment Concurrently with the Private Offering, the Company sold an aggregate total of 470,281 shares of its common stock to the directors of the Company for $3.60 per share, and five year warrants to purchase an aggregate total of 155,190 shares of common stock for $3.60 per share in a series of above-market private transactions (the “Director Investment”). On August 28, 2013, the Company sold an additional 232,558 shares of common stock, and five year warrants to purchase 76,744 shares of common stock to two of the Company’s directors at above-market prices on substantially the same terms as the Director Investment. ResposiTrak Agreement Effective June 30, 2013, the Company, ReposiTrak, Inc. (“ReposiTrak”), and Levitt Partners, LLC (“Levitt”) entered into an Omnibus Subscription, Management and Option Agreement (the “Omnibus Agreement”), which agreement amends and restates the Subscription Agreement and Management and Operating Agreement, each dated April 1, 2012 (together, the “Original Agreements”). Under the terms of the Omnibus Agreement, the Company agreed to continue providing certain management and business services to ReposiTrak, including powering ReposiTrak’s subscription-based analytical service of food and drug supply chains with the Company’s technologies for a three year term. In addition to certain subscription and management fees, the Company also received a nine-year option to purchase approximately 75% of the ReposiTrak’s issued and outstanding securities, on a fully diluted basis, for prices ranging from $0.15 - $1.17 per share. As a result of the Omnibus Agreement, the Original Agreements terminated. For the year ended June 30, 2013, total revenue attributable to ReposiTrak under the Original Agreements was approximately $1.88 million, of which $1.6 million was paid in the form of a promissory note issued by ReposiTrak to the Company.

DESCRIPTION OF BUSINESS AND MERGER OF PRESCIENT APPLIED INTELLIGENCE, INC.

12 Months Ended

Jun. 30, 2013

NOTE 1 - DESCRIPTION OF BUSINESS AND MERGER OF PRESCIENT APPLIED INTELLIGENCE, INC.

Summary of Business

Park City Group, Inc. (the “Company”) is incorporated in the state of Nevada. The Company’s 98.76% and 100% owned subsidiaries, Park City Group, Inc. and Prescient Applied Intelligence, Inc. (“Prescient”), respectively, are incorporated in the state of Delaware. All intercompany transactions and balances have been eliminated in consolidation.

The Company designs, develops, markets and supports proprietary software products. These products are designed for businesses having multiple locations to assist in the management of business operations on a daily basis and communicate results of operations in a timely manner. In addition, the Company has built a consulting practice for business improvement that centers on the Company’s proprietary software products. The principal markets for the Company's products are multi-store retail and convenience store chains, branded food manufacturers, suppliers and distributors, and manufacturing companies, which have operations in North America, Europe, Asia and the Pacific Rim.

Recent Developments

CVS Pharmacy, Inc.

On July 31, 2012, the Company announced a three-year service agreement to provide selected scan-based trading services to CVS Pharmacy, Inc. (“CVS”) through May 2015. The agreement reflects the Company's focus on increasing the number of retailers that use its software on a subscription basis, and marks the Company's progress towards contracting with major retailers outside of the grocery industry.

In addition to the agreement with CVS, the Company initiated test programs to provide services to two large national retailers with upwards of 12,000 stores combined nationwide. The Company expects the subscription revenue potential generated from these relationships to be significantly larger than any of the Company's existing client hubs within the grocery industry.

Stock Repurchase Program

On September 4, 2012, the Company announced that its Board of Directors had approved a share repurchase program (the "Repurchase Program") of up to $2.0 million of the Company's common stock over the next two years, or such other date, which ever is earlier, when the Repurchase Program is revoked or varied by the Board of Directors. The Repurchase Program does not obligate the Company to acquire any particular number of shares of common stock. The Repurchase Program may be suspended, modified or discontinued at any time at the Company's discretion without prior notice.

Series A Redemption

On March 15, 2013, the Company called for the redemption of all outstanding shares of its Series A Convertible Preferred Stock (“Series A Preferred”), pursuant to the Certificate of Designation of the Relative Rights, Powers and Preference of the Series A Preferred (the “Certificate of Designation”), which allowed the Company to, upon 30 days written notice, redeem all issued and outstanding shares of Series A Preferred for $10.00 per share (the “Series A Preferred Redemption”). Holders of Series A Preferred could also elect to convert, rather than redeem, their shares of Series A Preferred into 3.33 shares of common stock, at $3.00 per share. The Company completed the Series A Preferred Redemption on April 15, 2013. All but one holder of Series A Preferred elected to convert their shares of Series A Preferred into shares of the Company’s common stock.

Series A Private Offering

In March 2013, the Company issued an aggregate total of 756,858 shares of its common stock for $3.50 per share, and five year warrants (the “Investor Warrant(s)”) to purchase an aggregate total of 249,763 shares of common stock for $3.50 per share to certain accredited investors (the “Investors”) in a series of private transactions (the “Private Offering”) in order to finance the Series A Preferred Redemption. The Company also issued warrants to certain affiliates of the placement agent for three of the Investors, on substantially similar terms to those offered to the Investors (“Placement Agent Warrant(s)”), to purchase 18,857 shares of common stock as partial consideration for facilitating a portion of the Private Offering.

The Company also entered into a Registration Rights Agreement with certain investors, wherein the Company agreed to register the shares of common stock, Investor Warrants and Placement Agent Warrants with the Securities and Exchange Commission (the “SEC”). In accordance with this Registration Rights Agreement, the Company filed a registration statement on Form S-3 with the SEC on April 15, 2013. The registration statement was declared effective by the SEC on May 15, 2013.

Director Investment

Concurrently with the Private Offering, the Company sold an aggregate total of 470,281 shares of its common stock to the directors of the Company for $3.60 per share, and five year warrants to purchase an aggregate total of 155,190 shares of common stock for $3.60 per share in a series of above-market private transactions (the “Director Investment”).

On August 28, 2013, the Company sold an additional 232,558 shares of common stock, and five year warrants to purchase 76,744 shares of common stock to two of the Company’s directors at above-market prices on substantially the same terms as the Director Investment.

ResposiTrak Agreement

Effective June 30, 2013, the Company, ReposiTrak, Inc. (“ReposiTrak”), and Levitt Partners, LLC (“Levitt”) entered into an Omnibus Subscription, Management and Option Agreement (the “Omnibus Agreement”), which agreement amends and restates the Subscription Agreement and Management and Operating Agreement, each dated April 1, 2012 (together, the “Original Agreements”). Under the terms of the Omnibus Agreement, the Company agreed to continue providing certain management and business services to ReposiTrak, including powering ReposiTrak’s subscription-based analytical service of food and drug supply chains with the Company’s technologies for a three year term. In addition to certain subscription and management fees, the Company also received a nine-year option to purchase approximately 75% of the ReposiTrak’s issued and outstanding securities, on a fully diluted basis, for prices ranging from $0.15 - $1.17 per share. As a result of the Omnibus Agreement, the Original Agreements terminated. For the year ended June 30, 2013, total revenue attributable to ReposiTrak under the Original Agreements was approximately $1.88 million, of which $1.6 million was paid in the form of a promissory note issued by ReposiTrak to the Company.

- Definition

The entire disclosure for the organization, consolidation and basis of presentation of financial statements disclosure, and significant accounting policies of the reporting entity. May be provided in more than one note to the financial statements, as long as users are provided with an understanding of (1) the significant judgments and assumptions made by an enterprise in determining whether it must consolidate a VIE and/or disclose information about its involvement with a VIE, (2) the nature of restrictions on a consolidated VIE's assets reported by an enterprise in its statement of financial position, including the carrying amounts of such assets, (3) the nature of, and changes in, the risks associated with an enterprise's involvement with the VIE, and (4) how an enterprise's involvement with the VIE affects the enterprise's financial position, financial performance, and cash flows. Describes procedure if disclosures are provided in more than one note to the financial statements.

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