ACCOUNTS PAYABLE AND ACCRUED EXPENSES

12 Months Ended

Dec. 31, 2012

Payables and Accruals [Abstract]

ACCOUNTS PAYABLE AND ACCRUED EXPENSES

7. ACCOUNTS PAYABLE AND ACCRUED EXPENSES

Accounts payable and accrued expenses consisted of the following at December 31, 2012 and December 31, 2011:

	2012		2011
Trade payables	$	16,226,000	$	12,678,000
Sales commissions payable		5,549,000		4,578,000
Sales tax accrual		3,295,000		-
Accrued payroll and related taxes		3,151,000		1,574,000
	$	28,221,000	$	18,830,000

The focus of sales tax on internet based remote sellers has gained momentum in many states in 2012. Because of this, combined with the desire of the Company to create symmetry among all sales channels, the Company re-aligned its sales tax position to be more consistent with the Company’s state income tax restructurings discussed in Note 10 and mitigated any risk of noncompliance with state jurisdictions.  The Company will commence collecting and remitting sales tax in all states that impose sales or use taxes and is in the process of entering voluntary disclosure agreements with various states for 2012 and prior sales tax exposures.  The total amount of sales tax liability estimated relating to such disclosure agreements is estimated at $3.3 million.The accrued sales tax liability is a result of varying application of statutes, rules, regulations and interpretations. Our assessment reflects assumptions and judgments about potential actions by taxing jurisdictions. We believe these assumptions and judgments are reasonable; however, future developments by taxing jurisdictions may alter our current estimate.