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Document and Entity Information Document	9 Months Ended
Document and Entity Information Document	Sep. 30, 2013	Nov. 18, 2013
Document Information [Line Items]
Entity Registrant Name	Arrhythmia Research Technology Inc /DE/
Entity Central Index Key	0000819689
Current Fiscal Year End Date	--12-31
Entity Filer Category	Smaller Reporting Company
Document Type	10-Q
Document Period End Date	Sep. 30, 2013
Document Fiscal Year Focus	2013
Document Fiscal Period Focus	Q3
Amendment Flag	false
Entity Common Stock, Shares Outstanding		2,704,239

Consolidated Balance Sheets (USD $)	Sep. 30, 2013	Dec. 31, 2012
Current assets:
Cash and cash equivalents	$ 455,817	$ 477,708
Restricted Cash	1,000,000	0
Trade and othe accounts receivable, net of allowance for doubtful accounts of $40,000 and $117,098, respectively	2,541,889	3,181,721
Inventories, net	2,654,011	2,415,104
Deferred income taxes	0	199,432
Income tax receivable	127,961	194,912
Deposits, prepdaid expenses and other current assets	689,596	574,999
Current assets from discontinued operations	4,285	34,301
Total current assets	7,473,559	7,078,177
Property, plant and equipment, net	7,545,275	7,158,512
Other intangible assets, net	183,467	156,091
Long-term deferred tax assets, net	0	2,068,538
Other non-current assets	258,767	214,596
Non-current assets from discontinued operations	0	284,300
Total assets	15,461,068	16,960,214
Current liabilities:
Demand line of credit	0	800,000
Equipment line of credit	177,251
Current portion of long-term debt	280,006	0
Current portion of equipment notes	51,108	267,043
Accounts payable	2,540,359	2,437,778
Accrued expenses	619,756	393,913
Customer deposits	19,509	121,779
Current portion of deferred revenue	269,498	315,268
Performance guarantee liability	1,000,000	1,000,000
Current liabilities from discontinued operations	319,937	600,571
Total current liabilities	5,277,424	5,936,352
Long-term liabilities:
Revolving line of credit	2,399,493	0
Long-term debt, net of current portion	1,083,903	0
Long-term equipment note, net of current portion	183,538	991,213
Long-term portion of deferred gain on lease	0	8,934
Long-term deferred revenue, net of current portion	240,744	326,982
Total long-term liabilities	3,907,678	1,327,129
Total liabilties	9,185,102	7,263,481
Shareholders’ equity:
Preferred stock, $1 par value; 2,000,000 shares authorized, none issued	0	0
Common stock, $0.01 par value; 10,000,000 shares authorized, 3,926,491 shares issued, 2,704,239 shares outstanding	39,265	39,265
Additional paid-in-capital	11,151,221	11,110,575
Common stock held in treasury, 1,222,252 shares at cost	(3,335,268)	(3,335,268)
Accumulated other comprehensive income	42,502	42,502
Retained (deficit) earnings	(1,621,754)	1,839,659
Total shareholders' equity	6,275,966	9,696,733
Total liabilities and shareholders' equity	$ 15,461,068	$ 16,960,214

Consolidated Balance Sheet Parenthetical (Parentheticals) (USD $)	Sep. 30, 2013	Dec. 31, 2012
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Allowance for Doubtful Accounts Receivable	$ 40,000	$ 117,098
Preferred stock, par value	$ 1	$ 1
Preferred stock, shares authorized	2,000,000	2,000,000
Preferred Stock, Shares Issued	0	0
Common Stock, Par or Stated Value per Share	$ 0.01	$ 0.01
Common Stock, Shares Authorized	10,000,000	10,000,000
Common Stock, Shares, Issued	3,926,491	3,926,491
Common Stock, Shares, Outstanding	2,704,239	2,790,514
Treasury Stock, Shares	1,222,252	1,222,252

Consolidated Statements of Operations (USD $)	3 Months Ended		9 Months Ended
Consolidated Statements of Operations (USD $)	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012
Net revenues	$ 4,728,217	$ 4,959,034	$ 15,251,851	$ 15,585,157
Cost of sales	4,178,406	4,197,937	13,192,226	12,884,526
Gross profit	549,811	761,097	2,059,625	2,700,631
Selling and marketing	209,498	186,178	696,712	692,272
General and administrative	727,664	720,515	2,037,139	2,141,089
Research and development	131,077	115,034	251,772	380,266
Goodwill impairment	0	1,479,727	0	1,479,727
Total operating expense	1,068,239	2,501,454	2,985,623	4,693,354
Loss from operations	(518,428)	(1,740,357)	(925,998)	(1,992,723)
Interest expense	(51,393)	(7,969)	(258,940)	(14,855)
Other income (expense), net	293	(359)	8,063	(8,276)
Other expense, net	(51,100)	(8,328)	(250,877)	(23,131)
Loss from continuing operations before income tax (benefit) provision	(569,528)	(1,748,685)	(1,176,875)	(2,015,854)
Income tax (benefit) provision	0	(296,133)	2,267,969	(609,623)
Loss from continuing operations	(569,528)	(1,452,552)	(3,444,844)	(1,406,231)
Discontined Operations:
Income (Loss) from discontinued operations, net of tax provision of $0 and $0, respectively, for the three and nine months ended September 30, 2013 and a tax benefit of $1,190,580 and $1,731,580, respectively, for the three and nine months ended September 30, 2012	3,977	(1,996,055)	(16,569)	(3,523,380)
Net loss	$ (565,551)	$ (3,448,607)	$ (3,461,413)	$ (4,929,611)
Loss per share - basic and diluted
Continuing operations	$ (0.21)	$ (0.52)	$ (1.27)	$ (0.50)
Discontinued operations	$ 0.00	$ (0.72)	$ (0.01)	$ (1.26)
Loss per share - basic and diluted	$ (0.21)	$ (1.24)	$ (1.28)	$ (1.76)
Weighted average common shares outstanding - basic and diluted	2,704,239	2,790,514	2,704,239	2,790,514

Consolidated Statements of Operations Parenthetical (Parentheticals) (USD $)	3 Months Ended		9 Months Ended
	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012
Income Tax Expense (Benefit)	$ 0	$ 0	$ (1,190,580)	$ (1,731,580)

- Definition

The sum of the current income tax expense or benefit and the deferred income tax expense or benefit pertaining to continuing operations.

+ References+ Details

Statement of Changes in Shareholders' Equity (USD $)	Total	Common Stock	Additional Paid-in Capital	Treasury Stock	Accumulated other comprehensive income	Retained Earnings
Stockholders' Equity Attributable to Parent at Dec. 31, 2012	$ 9,696,733	$ 39,265	$ 11,110,575	$ (3,335,268)	$ 42,502	$ 1,839,659
Shares at Dec. 31, 2012	3,926,491	3,926,491		1,222,252
Share-based compensation	40,646		40,646
Net loss	(3,461,413)					(3,461,413)
Stockholders' Equity Attributable to Parent at Sep. 30, 2013	$ 6,275,966	$ 39,265	$ 11,151,221	$ (3,335,268)	$ 42,502	$ (1,621,754)
Shares at Sep. 30, 2013	3,926,491	3,926,491		1,222,252

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

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- Definition

Total of all stockholders' equity (deficit) items, net of receivables from officers, directors, owners, and affiliates of the entity which are attributable to the parent. The amount of the economic entity's stockholders' equity attributable to the parent excludes the amount of stockholders' equity which is allocable to that ownership interest in subsidiary equity which is not attributable to the parent (noncontrolling interest, minority interest). This excludes temporary equity and is sometimes called permanent equity.

+ References+ Details

Consolidated Statements of Cash Flows (USD $)	9 Months Ended
Consolidated Statements of Cash Flows (USD $)	Sep. 30, 2013	Sep. 30, 2012
Cash flows from operating activities:
Net loss	$ (3,461,413)	$ (4,929,611)
Loss from discontinued operations	16,569	3,523,380
Adjustments to reconcile net loss to net cash (used in) provided by operating activities:
Gain (loss) on sale if fixed assets	174	0
Amortization of the gain on lease	(8,934)	(3,350)
Goodwill impairment	0	1,479,727
Depreciation and amortization	1,074,339	1,074,764
Changes in allowance for doubtful accounts	(77,098)	45,000
Deferred income taxes	2,267,969	(605,123)
Share-based compensation	40,646	84,650
Changes in operating assets and liabilities:
Trade accounts receivable	716,930	194,148
Inventories	(238,907)	47,002
Deposits, prepaid expenses and other assets	(91,817)	(476,528)
Accounts payable	102,581	405,665
Accrued expenses and other liabilities	(8,435)	176,506
Net cash provided by operating activities of continuing operations	332,604	1,016,230
Net cash used in operating activities of discontinued operations	(277,215)	(2,514,591)
Net cash provided by (used in) operating activities	55,389	(1,498,361)
Cash flows from investing activities:
Purchases of property, plant and equipment	(1,200,346)	(893,887)
Proceeds from sale of fixed asset	1,528	306,285
Cash paid for patents and trademarks	(33,902)	0
Net cash used in investing activities of continuing operations	(1,232,720)	(587,602)
Net cash provided by (used in) investing activities of discontinued operations	284,300	(484,481)
Net cash used in investing activities	(948,420)	(1,072,083)
Cash flows from financing activities:
Proceeds from revolving line of credit	2,399,493	0
Proceeds from (payments on) demand line of credit, net	(800,000)	800,000
Proceeds from equipment line of credit	177,251	0
Proceeds from long-term debt	1,500,000	0
Payments on long-term debt	(136,091)	0
Proceeds from equipment notes	0	262,960
Payments on equipment notes	(1,296,110)	(48,119)
Cash dividend paid	0	(84,119)
Restricted cash	(1,000,000)	0
Net cash provided by financing activities of continuing operations	844,543	930,722
Net cash (used in) provided by financing activities of discontinued operations	0	631,897
Net cash provided by financing activities	844,543	1,562,619
Net decrease in cash and cash equivalents	(48,488)	(1,007,825)
Cash and cash equivalents at beginning of period, (including $30,882 and $102,972 of cash of discontinued operations)	508,590	1,358,223
Cash and cash equivalents at end of period	460,102	350,398
Less cash and cash equivalents of discontinued operations at end of period	(4,285)	(72,021)
Cash and cash equivalents of continuing operations at end of period	455,817	278,377
Supplemental Cash Flow Information [Abstract]
Cash Paid for Interest	91,751	15,097
Proceeds from Income Tax Refunds	66,951	0
Acquisition of equipment with equipment notes	$ 272,500	$ 476,687

Consolidated Statements of Cash Flows (Parentheticals) Statement (USD $)	Sep. 30, 2013	Sep. 30, 2012
Consolidated Statements of Cash Flows Parenthetical [Abstract]
Cash and cash equivalents, discontinued operations	$ 30,882	$ 102,972

Note 1. Basis of Presentation	9 Months Ended
Note 1. Basis of Presentation	Sep. 30, 2013
Basis of Presentation [Abstract]
Basis of Presentation	Basis of Presentation The unaudited interim consolidated financial statements and related notes have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the "SEC"). Accordingly, certain information and footnote disclosures normally included in complete financial statements prepared in accordance with U.S. generally accepted accounting principles ("GAAP") have been omitted pursuant to such rules and regulations. The accompanying unaudited interim consolidated financial statements and related notes should be read in conjunction with the consolidated financial statements and notes thereto included in the Arrhythmia Research Technology, Inc. ("ART") and subsidiaries (the “Company”) Annual Report on Form 10-K for the year ended December 31, 2012 filed with the SEC on May 31, 2013. The information presented reflects, in the opinion of the management of the Company, all adjustments necessary for a fair presentation of the financial results for the interim periods presented. 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 revenues and expenses during the reporting period. Actual results could differ from those estimates. Operating results for interim periods are not necessarily indicative of results that may be expected for the entire fiscal year. Operating matters and liquidity The Company expects that its current and anticipated financial resources, including the Company's bank facility, are adequate to maintain current and planned operations through September 30, 2014. The multi-year credit facility entered into on March 29, 2013, includes a revolving line of credit of up to $4.0 million, a commercial term loan of $1.5 million and an equipment line of credit of $1.0 million (see Note 5). The Company believes that cash flows from its operations, together with its existing working capital and other resources, will be sufficient to fund operations at current levels and repay debt obligations over the next twelve months. The Company expects improvements in sales within new and existing channels to continue as a result of the Company's prior and future investments in capital equipment and human resources. The Company expects to meet its goals in these areas, realize returns on its capital investments over the last nine months and generate the additional cash needed to fund operations into 2014 and beyond; however, there can be no assurance that the Company will be able to do so.

- Definition

The entire disclosure for organization, consolidation and basis of presentation of financial statements disclosure.

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+ Details

Note 2. Accounting Policies (Notes)

9 Months Ended

Sep. 30, 2013

Accounting Policies [Abstract]

Accounting Policies

Principles of Consolidation

The consolidated financial statements include the accounts of ART and its wholly owned subsidiary, Micron Products, Inc. ("Micron"). The Company's Pennsylvania subsidiary, RMDDxUSA Corp., and its Prince Edward Island subsidiary, RMDDx Corporation, collectively "WirelessDx", discontinued operations in the third quarter of 2012 and are presented herein as discontinued operations. All intercompany balances and transactions have been eliminated in consolidation.

Revenue Recognition

Revenue is recorded when all criteria for revenue recognition have been satisfied, which is generally when goods are shipped to the Company's customers. Product revenue is recognized in the period when persuasive evidence of an arrangement with a customer exists, the products are shipped and title has transferred to the customer, the price is fixed or determined and collection is probable.

The Company enters into arrangements containing multiple elements which may include a combination of the sale of molds, tooling, engineering and validation services and production units. The Company has determined that the sale of certain molds, tooling, engineering and validation services, and the production units, represent one unit of accounting, based on an assessment of the respective standalone value, as defined in ASC 605-25, “Revenue Recognition: Multiple - Element Arrangements.”

The Company determines the estimated product life-cycle, based upon historical knowledge of the customer, over which the deferred revenue will be amortized into revenue, which is generally three years. The Company carries prepaid tooling costs associated with the related arrangement as other assets on the Company's balance sheet. These costs are amortized to expense at the same time as the deferred revenue is amortized into revenue.

The Company cannot effectively predict short-term or long-term production volume in a consistent and meaningful manner due to the nature of these molds, associated products and customer ordering patterns. Therefore, the Company is unable to account for the transactions under the Units of Production method and management has determined the most appropriate amortization method to be the straight-line method.

The Company also recognizes revenue in accordance with ASC 985-605 "Software - Revenue Recognition" for software licenses it sells. Revenue is recognized when licenses are sold as the revenue cycle is completed with no warranty, returns or technical support to customers. Total revenue from software sales was immaterial in relation to consolidated revenues.

Fair value of financial instruments

The carrying amount reported in the balance sheets for cash and cash equivalents, accounts receivable, accounts payable and accrued liabilities approximate their fair value due to the immediate or short-term nature of such instruments. The carrying value of debt approximates fair value since it provides for market terms and interest rates.

Concentration of credit risk

Financial instruments, which potentially expose the Company to concentrations of credit risk, consist primarily of trade accounts receivable and cash.

Accounts receivable are customer obligations due under normal trade terms. A large portion of the Company's products are sold to large diversified medical and defense product manufacturers. The Company does not generally require collateral for its sales; however, the Company believes that its terms of sale provide adequate protection against significant credit risk. Currently, the Company generally does not receive purchase volume commitments extending beyond several months. Large corporations can shift focus away from a need for the Company’s products and services with little or no warning. The loss of any one or more of these customers may have an immediate significant adverse effect on our financial results.

It is the Company’s policy to place its cash in high quality financial institutions. The Company does not believe significant credit risk exists above federally insured limits with respect to these institutions.

Cash and cash equivalents

Cash and cash equivalents consist of cash on hand and on deposit in high quality financial institutions with maturities of three months or less at the time of purchase.

Restricted cash

Restricted cash consists of cash on deposit at the Bank of Nova Scotia in lieu of a letter of credit associated with a performance guarantee liability (Note 9).

Allowance for doubtful accounts

Management regularly reviews accounts receivable to determine if any receivables will potentially be uncollectible. The Company includes any accounts receivable balances that are determined to be uncollectible, along with a general reserve, in the Company's overall allowance for doubtful accounts. After all attempts to collect a receivable have failed, the receivable is written off against the allowance. Based on the information available to the Company, management believes the allowance for doubtful accounts of $40,000 and $117,098 as of September 30, 2013 and December 31, 2012, respectively, are adequate.

Inventories

The Company values its inventory at the lower of average cost, first-in-first-out (FIFO) or net realizable value. The Company reviews its inventory for quantities in excess of production requirements, obsolescence and for compliance with internal quality specifications. Any adjustments to inventory would be equal to the difference between the cost of inventory and the estimated net market value based upon assumptions about future demand, market conditions and expected cost to distribute those products to market. The Company records adjustments to account for potential scrap during normal manufacturing operations or potential obsolescence for slow moving inventory.

Property, plant and equipment

Property, plant and equipment are recorded at cost and include expenditures which substantially extend their useful lives. Depreciation on property, plant and equipment is calculated using the straight-line method over the estimated useful lives of the assets. Expenditures for maintenance and repairs are charged to earnings as incurred. When equipment is retired or sold, the resulting gain or loss is reflected in earnings.

Long-lived and intangible assets

The Company assesses the impairment of long-lived assets and intangible assets with finite lives whenever events or changes in circumstances indicate that the carrying value may not be fully recoverable. Intangible assets consist of the following:



		September 30, 2013							December 31, 2012
	Estimated Useful Life (in years)	Gross		Accumulated Amortization			Net		Gross		Accumulated Amortization			Net
Patents and Trademarks	13	$	443,201	$	(420,936	)	$	22,265	$	480,750	$	(456,361	)	$	24,389
Patents and Trademarks*	—	141,923		—			141,923		110,702		—			110,702
Trade names	8	33,250		(13,971		)	19,279		33,250		(12,250		)	21,000
Total Intangible assets:		$	618,374	$	(434,907	)	$	183,467	$	624,702	$	(468,611	)	$	156,091

* Patents and Trademarks not yet in service.

Income taxes

The Company accounts for income taxes in accordance with ASC 740 “Income Taxes,” which requires recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements or tax returns. Under this method, deferred tax assets and liabilities are determined based on the difference between the financial statement and tax bases of assets and liabilities using tax rates in effect for the year in which the differences are expected to reverse.

As of June 30, 2013, the Company had recorded twelve consecutive quarters of pre-tax losses. Additionally, management’s projections of future income in the face of challenging market conditions, and the impact of identified tax planning strategies, creates uncertainty regarding the Company's ability to realize its deferred tax assets pursuant to the “more-likely-than-not” standard, as defined in ASC 740-10-30-5. Accordingly, in the second quarter the Company recorded tax expense of $2,267,969 to establish a full valuation allowance on its deferred tax assets.

Management evaluated and weighted all available evidence, both positive and negative, through June 30, 2013, and determined that the weight of negative evidence occurring in the second quarter made it difficult to form a supportable conclusion that a valuation allowance was not needed. Factors such as projected increases in cost of sales, overall sales volumes from key customers and the continued volatility in the silver market negatively impacted the second quarter re-forecast of pre-tax earnings and the analysis of future taxable income. Consequently, management determined that the Company could not support the realization of its deferred tax assets, at a more-likely-than-not standard, and identified the second quarter of 2013 as the appropriate period to record a full valuation allowance, on its deferred tax assets of $2,267,969. Management determined that no change was necessary for the three months ended September 30, 2013.

Share-based compensation

Share-based compensation cost is measured at the grant date, based on the fair value of the award, and is recognized as an expense over the employee’s requisite service period (generally the vesting period of the equity grant).

Comprehensive income

The Company has accumulated comprehensive income of $42,502 from changes in currency valuations with our discontinued Canadian operations as of September 30, 2013 and December 31, 2012. There were no changes in comprehensive income in the three or nine months ended September 30, 2013.

(Loss) earnings per share data

Basic earnings per share is computed by dividing income available to common shareholders by the weighted average number of common shares outstanding. The computation of diluted earnings per share is similar to the computation of basic earnings per share except that the denominator is increased to include the average number of additional common shares that would have been outstanding if the dilutive potential common shares had been issued. In addition, the numerator is adjusted for any changes in income that would result from the assumed conversions of those potential shares. As of September 30, 2013 and December 31, 2012 there were 226,500 and 285,000 options outstanding, respectively, that were anti-dilutive and were not included in the calculation of earnings or loss per share.

Basic and diluted EPS computations are as follows:



		Three months ended September 30,						Nine months ended September 30,
		(unaudited)						(unaudited)
		2013			2012 Revised			2013			2012 Revised
Net loss available to common shareholders	$	(565,551	)	$	(3,448,607	)	$	(3,461,413	)	$	(4,929,611	)
Weighted average common shares outstanding		2,704,239			2,790,514			2,704,239			2,790,514
Loss per share - basic and diluted
Continuing operations		(0.21	)		(0.52	)		(1.27	)		(0.50	)
Discontinued operations		—			(0.72	)		(0.01	)		(1.26	)
Loss per share - basic and diluted	$	(0.21	)	$	(1.24	)	$	(1.28	)	$	(1.76	)

Segments

In 2012, the Company determined that the Company's results will be reported as one segment due to the discontinued operations of its WirelessDx segment and since the results of its previously reported ART segment were not quantitatively material and were not regularly reviewed by the Chief Operating and Decision Maker ("CODM").

Research and development

Research and development expenses include costs directly attributable to the conduct of research and development programs primarily related to the development of our software products and improving the efficiency and capabilities of our manufacturing processes. Such costs include salaries, payroll taxes, employee benefit costs, materials, supplies, depreciation on research equipment, and services provided by outside contractors. All costs associated with research and development programs are expensed as incurred.

Reclassifications

Certain reclassifications have been made to prior period amounts to conform to the current period presentation. In 2012, the Company revised prior period balances to correct errors in the revenue recognition of certain Tooling transactions (Note 10).

- Definition

The entire disclosure for all significant accounting policies of the reporting entity.

+ References+ Details

Note 3. Inventories

9 Months Ended

Sep. 30, 2013

Inventories [Abstract]

Inventories

Inventories consist of the following:



	September 30, 2013		December 31, 2012
Raw materials	$	1,062,042	$	521,908
Work-in-process	302,891		248,159
Finished goods	1,289,078		1,645,037
Total	$	2,654,011	$	2,415,104

The value of silver in inventory at September 30, 2013 and December 31, 2012 as a part of finished goods as plated sensors, work in process, or raw materials was $446,664 and $541,804, respectively. Inventories are stated at their net realizable value, net of a reserve for slow moving and obsolete inventory of $373,000 and $317,484 at September 30, 2013 and December 31, 2012, respectively.

- Definition

The entire disclosure for inventory. This may include, but is not limited to, the basis of stating inventory, the method of determining inventory cost, the major classes of inventory, and the nature of the cost elements included in inventory. If inventory is stated above cost, accrued net losses on firm purchase commitments for inventory and losses resulting from valuing inventory at the lower-of-cost-or-market may also be included. For LIFO inventory, may disclose the amount and basis for determining the excess of replacement or current cost over stated LIFO value and the effects of a LIFO quantities liquidation that impacts net income.

+ References+ Details

Note 4. Plant, Property & Equipment, net (Notes)

9 Months Ended

Sep. 30, 2013

Plant, Property & Equipment, net [Abstract]

Property, Plant & Equipment, net

Property, Plant and Equipment, net

Property, plant and equipment consist of the following:



	Asset lives (in years)				September 30, 2013			December 31, 2012
Machinery and equipment		3	to	15	$	13,492,740		$	12,298,011
Building and improvements			20		4,298,556			4,293,725
Vehicles		3	to	5	94,227			94,227
Furniture, fixtures, computers and software		3	to	5	1,263,879			1,246,807
Land					202,492			202,492
Construction in progress					264,750			103,269
Total property, plant and equipment					19,616,644			18,238,531
Less: accumulated depreciation					(12,071,369		)	(11,080,019		)
Property, plant and equipment, net					$	7,545,275		$	7,158,512

For the nine months ended September 30, 2013 and 2012, the Company recorded $1,067,812 and $1,069,967 of depreciation expense, respectively.

- Definition

The entire disclosure for long-lived, physical assets that are used in the normal conduct of business to produce goods and services and not intended for resale. Examples include land, buildings, machinery and equipment, and other types of furniture and equipment including, but not limited to, office equipment, furniture and fixtures, and computer equipment and software. This disclosure may include property plant and equipment accounting policies and methodology, a schedule of property, plant and equipment gross, additions, deletions, transfers and other changes, depreciation, depletion and amortization expense, net, accumulated depreciation, depletion and amortization expense and useful lives, income statement disclosures, assets held for sale and public utility disclosures.

+ References+ Details

Note 5. Debt	9 Months Ended
Note 5. Debt	Sep. 30, 2013
Debt [Abstract]
Debt	Debt On March 29, 2013, the Company entered into a multi-year credit facility with a Massachusetts based bank. The credit facility includes a revolver of up to $4.0 million, a commercial term loan of $1.5 million and an equipment line of credit of $1.0 million and is secured by substantially all assets of the Company with the exception of real property. The revolver provides for borrowings up to 80% of eligible accounts receivable and 50% of eligible raw materials inventory. This revolver replaced the previous $3.0 million demand line of credit which was scheduled to expire April 30, 2013. The interest rate on the revolver at September 30, 2013 was 3.50% and the outstanding principal balance was $2,399,493. This revolver has a maturity date of June 30, 2015. The commercial term loan from the bank facility was used to refinance existing equipment notes, operating leases, and to fund other current liabilities of continuing operations. At September 30, 2013, the outstanding amount remaining on the term loan was $1,363,909. The term loan has a five year term with a maturity date of March 29, 2018. The interest rate on the loan is a fixed 4.25% per annum. The equipment line of credit allows for advances on the equipment line that shall not exceed 80% of the invoice amount of the equipment being purchased. The interest rate at September 30, 2013 was 3.50% and the outstanding principal balance was $177,251. The term of the equipment line of credit is six years, maturing on March 29, 2019, inclusive of a one year maximum draw period during which payments are interest only. This equipment line of credit will convert to a five year term loan at the end of the one year draw period, or when the $1.0 million line is fully drawn upon. In January 2013, the Company entered into two equipment notes totaling $272,500 with a financing company to acquire production equipment. The outstanding balance of these equipment notes at September 30, 2013 was $234,646. The term of these equipment notes is five years. The borrowing agreement, under the bank facility as described above, contains both financial and non-financial covenants. The financial covenants include maintaining certain debt coverage and leverage ratios. The non-financial covenants relate to various matters including notice prior to executing further borrowings and security interests, mergers or consolidations, acquisitions, guarantees, sales of assets other than in the normal course of business, leasing, changes in ownership and payment of dividends. As a result of the third quarter results, the Company was not in compliance with a financial covenant. On November 19, 2013, the Company received a formal waiver as to the non-compliance. At December 31, 2012, the Company had a master lease agreement with its bank that allowed for money to be drawn on standard terms for the purchase of equipment. The equipment notes under the master lease agreement were paid off in April 2013 using the commercial term loan under bank facility.

- Definition

The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants.

+ References+ Details

Note 6. Income Taxes

9 Months Ended

Sep. 30, 2013

Income Taxes [Abstract]

Income Taxes

The following table sets forth certain information regarding the Company's income tax (benefits) provision:



	Three months ended September 30,					Nine months ended September 30,
	2013		2012 Revised			2013		2012 Revised
Income tax (benefit) provision from continuing operations	$	—	$	(296,133	)	$	2,267,969	$	(609,623	)

The tax provision for the nine months ended September 30, 2013 and the tax benefit for the nine months ended September 30, 2012 are attributable to the U.S. Federal, state and foreign income taxes on our continuing operations. The tax provision for the nine months ended September 30, 2013 includes the impact on tax expense of $2,267,969 associated with the establishment of a full valuation allowance of the Company’s deferred tax assets (see Note 2).

The Company files income tax returns in the U.S. Federal and various state and foreign jurisdictions and the periods from 2009 to 2012 remain open to examination by the taxing authorities in the various jurisdictions. The Company believes it is not subject to any significant tax risks related to uncertain tax positions. Accordingly, the Company has not accrued interest or penalties associated with unrecognized tax benefits.

The Company recorded no income tax provision or benefit for the three months ended September 30, 2013, due to the establishment of a full valuation allowance of the Company's deferred tax assets in the second quarter (see Note 2), as compared to a tax benefit of $296,133 for the three months ended September 30, 2012.

The Company recorded no income tax provision or benefit for discontinued operations for the three or nine months ended September 30, 2013, as compared to income tax benefits of $1,190,580 and $1,731,580, respectively for the three and nine months ended September 30, 2012, which is reflected in the net loss from discontinued operations, net of tax, in the Company's consolidated statements of operations.

- Definition

The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.

+ References

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-Number 109

-Paragraph 136, 172

-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

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+ Details

Note 7. Commitments and Contingencies (Notes)	9 Months Ended
Note 7. Commitments and Contingencies (Notes)	Sep. 30, 2013
Commitments and Contingencies [Abstract]
Commitments and Contingencies	Commitments and Contingencies Legal Matters From time to time, the Company is subject to legal proceedings, threats of legal action and claims which arise in the ordinary course of our business. With respect to three specific matters, aggregate claims have been asserted of approximately $700,000. Management believes the maximum reasonably possible loss related to these matters is substantially less than the amounts asserted. Management, with its external legal counsel, intends to vigorously defend these matters and management believes that it has meritorious defenses in all such matters. Accordingly, no accrual has been recorded for these matters as of September 30, 2013. Management believes that the ultimate resolution of these matters, including likely recoveries from insurance carriers if unfavorable outcomes occur, will not have a material adverse effect on our results of operations or financial condition. Operating Leases The Company leases certain equipment under non-cancelable lease arrangements ranging from three to five years. Lease expense under all operating leases was approximately $0 and $52,854 for the three months ended September 30, 2013 and 2012, respectively and $50,781 and $158,562 for the nine months ended September 30, 2013 and 2012, respectively.

- Definition

The entire disclosure for commitments and contingencies.

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-Number 14

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+ Details

Note 8. Share-Based Compensation

9 Months Ended

Sep. 30, 2013

Share-based Compensation [Abstract]

Share-Based Compensation

The Company recognized share-based compensation expense of $12,900 and $20,148 for the three months ended September 30, 2013 and 2012, respectively and $40,646 and $84,650 for the nine months ended September 30, 2013 and 2012, respectively.

The fair value of each stock option granted is estimated on the date of grant using the Black-Scholes option-pricing model. Key assumptions used to estimate the fair value of the stock options include the exercise price of the award, the expected option term, the expected volatility of the Company’s stock over the option’s expected term, the risk free interest rate over the option’s expected term, and the Company’s expected annual dividend yield. The Company believes that the valuation technique and the approach utilized to develop the underlying assumptions are appropriate in calculating the fair values of the Company’s stock options for the three and nine months ended September 30, 2013 and 2012. Estimates of fair values are not intended to predict actual future events or the value ultimately realized by persons who receive equity awards.

The option life was determined using the historical data to determine an expected option life. Prior to 2013 the simplified method was used. During the three months ended September 30, 2013, no new grants were issued. During the nine months ended September 30, 2013, a total of 15,000 new grants were issued. No new grants were issued during the three and nine months ended September 30, 2012.

Share-based incentive plan

At September 30, 2013, the Company had one stock option plan that provides for both incentive and non-qualified stock options to be granted to certain eligible employees, non-employee directors, or consultants. On March 10, 2010, the Company's Board of Directors adopted the Arrhythmia Research Technology, Inc. 2010 Equity Incentive Plan (the “2010 Plan”) upon the recommendation of the Compensation Committee. The 2010 Plan authorizes the issuance of an aggregate of 500,000 shares, namely, 400,000 shares of our common stock plus an aggregate of 100,000 shares previously reserved for issuance under the Company's 2005 Stock Award Plan (the “2005 Plan”). The 2010 Plan replaced in its entirety the 2005 Plan, under which no grants have been made. The Company's 2001 Stock Option Plan (the "2001 Plan"), which expired in 2011, will continue to govern outstanding options but no further options will be granted under the 2001 Plan. The options granted have either six or ten year contractual terms and either vest immediately or vest annually over a five-year term.

At September 30, 2013, there were 375,000 shares available for future grants under the 2010 Plan.

The following table sets forth the stock option transactions for the nine months ended September 30, 2013:



	Number of shares		Weighted average exercise price		Weighted average remaining contractual term (years)	Aggregate intrinsic value
Outstanding at December 31, 2012	285,000		$	2.44	4.8	$	—
Exercisable at December 31, 2012	138,900		2.53		3.1	—
Granted	15,000		2.58		9.75	—
Exercised	—		—		—	—
Forfeited/expired	(73,500	)			—	—
Outstanding at September 30, 2013	226,500		6.16		4.62	1,800
Exercisable at September 30, 2013	142,500		$	6.39	3.28	$	—

During the nine months ended September 30, 2013, 15,000 new options were granted as compared to zero new options for the same period in 2012. At September 30, 2013 and 2012, the intrinsic value of the exercisable options is $1,800 and $0, respectively.

The following table sets forth the status of the Company’s non-vested options for the nine months ended September 30, 2013:



	Number of shares		Weighted average fair value
Non-vested at December 31, 2012	146,100		$	1.22
Granted	15,000		0.82
Vested	(48,300	)	1.50
Forfeited/expired	(28,800	)	1.28
Non-vested at September 30, 2013	84,000		$	0.97

At September 30, 2013, there was $84,761 of total unrecognized cost related to non-vested share-based compensation arrangements granted under the Plan. This cost is expected to be recognized over a weighted average period of 2.83 years.

Note 9. Discontinued Operations

9 Months Ended

Sep. 30, 2013

Discontinued Operations [Abstract]

Discontinued Operations

In the third quarter of 2012 the Company discontinued the operations of its WirelessDx subsidiaries.

Net revenues from discontinued operations for the three months ended September 30, 2013 and 2012 were $0 and $132,137, respectively. Net income from discontinued operations for the three months ended September 30, 2013 was $3,977 as compared to a net loss from discontinued operations of $1,996,055 for the same period in 2012, respectively, presented net of tax of $0 and a tax benefit of $1,190,580, respectively.

Net revenues from discontinued operations for the nine months ended September 30, 2013 and 2012 were $0 and $372,955, respectively. Loss from discontinued operations for the nine months ended September 30, 2013 and 2012 were $16,569 and $3,523,380, respectively, presented net of tax of $0 and a tax benefit of $1,731,580, respectively.

At September 30, 2013 and December 31, 2012, the Company has a $1.0 million liability for an unmet performance obligation related to the discontinued operations. This performance obligation was secured by a $1.0 million letter of credit at December 31, 2012. In April 2013, as part of a new bank facility, this letter of credit was replaced with $1.0 million in restricted cash. At both September 30, 2013 and December 31, 2012, the performance guarantee liability was carried on the balance sheet of continuing operations, as the liability is guaranteed by ART. The outcome of this liability will be determined on or before May 31, 2014.

The assets and liabilities of the discontinued operations are presented in the unaudited September 30, 2013 and audited December 31, 2012 condensed consolidated balance sheet excluding intercompany loans which exceed net book value listed below:



	September 30, 2013		December 31, 2012
Cash	$	4,285	$	30,882
Prepaid expenses and other assets	—		3,419
Total current assets from discontinued operations	4,285		34,301

Property and equipment, net of impairment and accumulated depreciation of $119,050 and $1,434,937, respectively	—		284,300
Deferred taxes, non-current	—		—
Total non-current assets from discontinued operations	—		284,300
Total assets from discontinued operations	$	4,285	$	318,601
Accounts payable	$	319,937	$	477,324
Accrued expenses	—		123,247
Total current liabilities from discontinued operations	319,937		600,571
Total liabilities from discontinued operations	$	319,937	$	600,571

- Definition

The entire disclosure for the facts and circumstances leading to the completed or expected disposal, manner and timing of disposal, the gain (loss) recognized in the income statement and the income statement caption that includes that gain (loss), amounts of revenues and pretax profit or loss reported in discontinued operations, the segment in which the disposal group was reported, and the classification (whether sold or classified as held for sale) and carrying value of the assets and liabilities comprising the disposal group. Includes all disposal groups, including those classified as components of the entity (discontinued operations).

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Reference 7: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

-Topic 205

-SubTopic 20

-Section 45

-Paragraph 5

-URI http://asc.fasb.org/extlink&oid=6892542&loc=d3e1020-107759

Reference 8: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

-Topic 205

-SubTopic 20

-Section 50

-Paragraph 3

-URI http://asc.fasb.org/extlink&oid=6360339&loc=d3e1474-107760

Reference 9: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

-Topic 360

-SubTopic 10

-Section 45

-Paragraph 5

-URI http://asc.fasb.org/extlink&oid=8077374&loc=d3e2443-110228

Reference 10: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

-Topic 205

-SubTopic 20

-Section 50

-Paragraph 2

-URI http://asc.fasb.org/extlink&oid=6360339&loc=d3e1436-107760

+ Details

Note 10. Reclassification of prior periods (Notes)

9 Months Ended

Sep. 30, 2013

Reclassification of prior periods [Abstract]

Reclassification of prior periods

Revisions and Reclassification of Prior Period Balances

Certain revisions and reclassifications have been made to prior period amounts to conform to the current year presentation, primarily related to deferred revenue. In 2012, the Company revised prior period balances to correct errors in the revenue recognition of certain tooling transactions.

Revision of prior period financial statements

In 2012, the Company identified prior period errors relating to revenue recognition for certain tooling transactions that qualify for treatment as multiple-element arrangements. The Company concluded that these errors were not material individually or in the aggregate to any of the prior reporting periods, and therefore, amendments of previously filed reports were not required, as more fully described in the Company's Annual Report on Form 10-K for the year ended December 31, 2012. As such, the revisions for these corrections to the applicable prior periods are reflected in the financial information included herein and have been provided in summarized format below.

The impact of the errors on the Company's balance sheet as of September 30, 2012 is summarized below:



September 30, 2012	As originally reported		Correction of error adjustment			As revised
Assets
Current assets:
Deferred income taxes	$	—	$	59,493		$	59,493
Deposits, prepaid expenses and other current assets	745,531		222,019			967,550
Total current assets	7,962,690		281,512			8,244,202
Other non-current assets	—		218,299			218,299
Total assets	17,632,493		499,811			18,132,304

Liabilities and Shareholders’ Equity
Current liabilities:
Deferred revenue	—		281,746			281,746
Total current liabilities	5,595,292		281,746			5,877,038
Long-term liabilities:
Long-term deferred revenue	—		309,377			309,377
Total Long-term liabilities	1,068,992		309,377			1,378,369
Total liabilities	6,664,284		591,123			7,255,407
Shareholders’ equity:
Retained earnings	3,139,296		(91,312		)	3,047,984
Total shareholders’ equity	10,968,209		(91,312		)	10,876,897
Total liabilities and shareholders’ equity	17,632,493		499,811			18,132,304

The impact of the errors on the Company's statements of operations for the three and nine months ended September 30, 2012 is summarized below:



	Three months ended September 30, 2012								Nine months ended September 30, 2012
	As originally reported			Correction of error adjustment		As revised			As originally reported			Correction of error adjustment			As revised
Net revenues	$	4,839,812		$	119,222	$	4,959,034		$	15,881,161		$	(296,004	)	$	15,585,157
Cost of sales	4,112,599			85,338		4,197,937			13,106,456			(221,930		)	12,884,526
Gross profit	727,213			33,884		761,097			2,774,705			(74,074		)	2,700,631
Loss from operations	(1,774,241		)	33,884		(1,740,357		)	(1,918,649		)	(74,074		)	(1,992,723		)
Loss before taxes	(1,782,569		)	33,884		(1,748,685		)	(1,941,780		)	(74,074		)	(2,015,854		)
Income tax benefit	(309,500		)	13,367		(296,133		)	(580,400		)	(29,223		)	(609,623		)
Loss before discontinued operations	(1,473,069		)	20,517		(1,452,552		)	(1,361,380		)	(44,851		)	(1,406,231		)
Net loss	(3,469,124		)	20,517		(3,448,607		)	(4,884,758		)	(44,851		)	(4,929,611		)
Loss per share - basic and diluted	(1.24		)	0.01		(1.24		)	(1.75		)	(0.02		)	(1.76		)
Weighted average shares outstanding, basic and diluted	2,790,514			2,790,514		2,790,514			2,790,514			2,790,514			2,790,514

The impact of the errors on the Company's statement of cash flows for nine months ended September 30, 2012 is summarized below:



	Nine months ended September 30, 2012
	As originally reported			Correction of error adjustment			As revised
Net loss	$	(4,884,758	)	$	(44,853	)	$	(4,929,611	)
Deferred income taxes	(575,900		)	(29,223		)	(605,123		)
Changes in operating assets and liabilities:
Deposits, prepaid expenses and other assets	(254,598		)	(221,930		)	(476,528		)
Accrued expenses and other liabilities	(119,498		)	296,004			176,506
Net cash used in operating activities	(1,498,361		)	—			(1,498,361		)

- Definition

The entire disclosure for reporting accounting changes and error corrections. It includes the conveyance of information necessary for a user of the Company's financial information to understand all aspects and required disclosure information concerning all changes and error corrections reported in the Company's financial statements for the period.

+ References+ Details

Note 11. Subsequent Events (Notes)	9 Months Ended
Note 11. Subsequent Events (Notes)	Sep. 30, 2013
Subsequent Events [Abstract]
Subsequent Events	Subsequent Events As a result of the third quarter results, the Company was not in compliance with a financial covenant. On November 19, 2013, the Company received a formal waiver as to the non-compliance (see Note 5). There were no other subsequent events or transactions that require adjustment to or disclosure in these financial statements.

Note 2. Accounting Policies (Policies)

9 Months Ended

Sep. 30, 2013

Accounting Policies [Abstract]

Principles of Consolidation

The consolidated financial statements include the accounts of ART and its wholly owned subsidiary, Micron Products, Inc. ("Micron"). The Company's Pennsylvania subsidiary, RMDDxUSA Corp., and its Prince Edward Island subsidiary, RMDDx Corporation, collectively "WirelessDx", discontinued operations in the third quarter of 2012 and are presented herein as discontinued operations. All intercompany balances and transactions have been eliminated in consolidation.

Revenue Recognition

Revenue is recorded when all criteria for revenue recognition have been satisfied, which is generally when goods are shipped to the Company's customers. Product revenue is recognized in the period when persuasive evidence of an arrangement with a customer exists, the products are shipped and title has transferred to the customer, the price is fixed or determined and collection is probable.

The Company enters into arrangements containing multiple elements which may include a combination of the sale of molds, tooling, engineering and validation services and production units. The Company has determined that the sale of certain molds, tooling, engineering and validation services, and the production units, represent one unit of accounting, based on an assessment of the respective standalone value, as defined in ASC 605-25, “Revenue Recognition: Multiple - Element Arrangements.”

The Company determines the estimated product life-cycle, based upon historical knowledge of the customer, over which the deferred revenue will be amortized into revenue, which is generally three years. The Company carries prepaid tooling costs associated with the related arrangement as other assets on the Company's balance sheet. These costs are amortized to expense at the same time as the deferred revenue is amortized into revenue.

The Company cannot effectively predict short-term or long-term production volume in a consistent and meaningful manner due to the nature of these molds, associated products and customer ordering patterns. Therefore, the Company is unable to account for the transactions under the Units of Production method and management has determined the most appropriate amortization method to be the straight-line method.

The Company also recognizes revenue in accordance with ASC 985-605 "Software - Revenue Recognition" for software licenses it sells. Revenue is recognized when licenses are sold as the revenue cycle is completed with no warranty, returns or technical support to customers. Total revenue from software sales was immaterial in relation to consolidated revenues.

Fair value of financial instruments

The carrying amount reported in the balance sheets for cash and cash equivalents, accounts receivable, accounts payable and accrued liabilities approximate their fair value due to the immediate or short-term nature of such instruments. The carrying value of debt approximates fair value since it provides for market terms and interest rates.

Concentration of credit risk

Financial instruments, which potentially expose the Company to concentrations of credit risk, consist primarily of trade accounts receivable and cash.

Accounts receivable are customer obligations due under normal trade terms. A large portion of the Company's products are sold to large diversified medical and defense product manufacturers. The Company does not generally require collateral for its sales; however, the Company believes that its terms of sale provide adequate protection against significant credit risk. Currently, the Company generally does not receive purchase volume commitments extending beyond several months. Large corporations can shift focus away from a need for the Company’s products and services with little or no warning. The loss of any one or more of these customers may have an immediate significant adverse effect on our financial results.

It is the Company’s policy to place its cash in high quality financial institutions. The Company does not believe significant credit risk exists above federally insured limits with respect to these institutions.

Cash and cash equivalents

Cash and cash equivalents consist of cash on hand and on deposit in high quality financial institutions with maturities of three months or less at the time of purchase.

Restricted cash

Restricted cash consists of cash on deposit at the Bank of Nova Scotia in lieu of a letter of credit associated with a performance guarantee liability (Note 9).

Allowance for doubtful accounts

Management regularly reviews accounts receivable to determine if any receivables will potentially be uncollectible. The Company includes any accounts receivable balances that are determined to be uncollectible, along with a general reserve, in the Company's overall allowance for doubtful accounts. After all attempts to collect a receivable have failed, the receivable is written off against the allowance. Based on the information available to the Company, management believes the allowance for doubtful accounts of $40,000 and $117,098 as of September 30, 2013 and December 31, 2012, respectively, are adequate.

Inventories

The Company values its inventory at the lower of average cost, first-in-first-out (FIFO) or net realizable value. The Company reviews its inventory for quantities in excess of production requirements, obsolescence and for compliance with internal quality specifications. Any adjustments to inventory would be equal to the difference between the cost of inventory and the estimated net market value based upon assumptions about future demand, market conditions and expected cost to distribute those products to market. The Company records adjustments to account for potential scrap during normal manufacturing operations or potential obsolescence for slow moving inventory.

Property, plant and equipment

Property, plant and equipment are recorded at cost and include expenditures which substantially extend their useful lives. Depreciation on property, plant and equipment is calculated using the straight-line method over the estimated useful lives of the assets. Expenditures for maintenance and repairs are charged to earnings as incurred. When equipment is retired or sold, the resulting gain or loss is reflected in earnings.

Long-lived and intangible assets

The Company assesses the impairment of long-lived assets and intangible assets with finite lives whenever events or changes in circumstances indicate that the carrying value may not be fully recoverable. Intangible assets consist of the following:



		September 30, 2013							December 31, 2012
	Estimated Useful Life (in years)	Gross		Accumulated Amortization			Net		Gross		Accumulated Amortization			Net
Patents and Trademarks	13	$	443,201	$	(420,936	)	$	22,265	$	480,750	$	(456,361	)	$	24,389
Patents and Trademarks*	—	141,923		—			141,923		110,702		—			110,702
Trade names	8	33,250		(13,971		)	19,279		33,250		(12,250		)	21,000
Total Intangible assets:		$	618,374	$	(434,907	)	$	183,467	$	624,702	$	(468,611	)	$	156,091

* Patents and Trademarks not yet in service.

Income taxes

The Company accounts for income taxes in accordance with ASC 740 “Income Taxes,” which requires recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements or tax returns. Under this method, deferred tax assets and liabilities are determined based on the difference between the financial statement and tax bases of assets and liabilities using tax rates in effect for the year in which the differences are expected to reverse.

As of June 30, 2013, the Company had recorded twelve consecutive quarters of pre-tax losses. Additionally, management’s projections of future income in the face of challenging market conditions, and the impact of identified tax planning strategies, creates uncertainty regarding the Company's ability to realize its deferred tax assets pursuant to the “more-likely-than-not” standard, as defined in ASC 740-10-30-5. Accordingly, in the second quarter the Company recorded tax expense of $2,267,969 to establish a full valuation allowance on its deferred tax assets.

Management evaluated and weighted all available evidence, both positive and negative, through June 30, 2013, and determined that the weight of negative evidence occurring in the second quarter made it difficult to form a supportable conclusion that a valuation allowance was not needed. Factors such as projected increases in cost of sales, overall sales volumes from key customers and the continued volatility in the silver market negatively impacted the second quarter re-forecast of pre-tax earnings and the analysis of future taxable income. Consequently, management determined that the Company could not support the realization of its deferred tax assets, at a more-likely-than-not standard, and identified the second quarter of 2013 as the appropriate period to record a full valuation allowance, on its deferred tax assets of $2,267,969. Management determined that no change was necessary for the three months ended September 30, 2013.

Share-based compensation

Share-based compensation cost is measured at the grant date, based on the fair value of the award, and is recognized as an expense over the employee’s requisite service period (generally the vesting period of the equity grant).

Comprehensive income

The Company has accumulated comprehensive income of $42,502 from changes in currency valuations with our discontinued Canadian operations as of September 30, 2013 and December 31, 2012. There were no changes in comprehensive income in the three or nine months ended September 30, 2013.

(Loss) earnings per share data

Basic earnings per share is computed by dividing income available to common shareholders by the weighted average number of common shares outstanding. The computation of diluted earnings per share is similar to the computation of basic earnings per share except that the denominator is increased to include the average number of additional common shares that would have been outstanding if the dilutive potential common shares had been issued. In addition, the numerator is adjusted for any changes in income that would result from the assumed conversions of those potential shares. As of September 30, 2013 and December 31, 2012 there were 226,500 and 285,000 options outstanding, respectively, that were anti-dilutive and were not included in the calculation of earnings or loss per share.

Basic and diluted EPS computations are as follows:



		Three months ended September 30,						Nine months ended September 30,
		(unaudited)						(unaudited)
		2013			2012 Revised			2013			2012 Revised
Net loss available to common shareholders	$	(565,551	)	$	(3,448,607	)	$	(3,461,413	)	$	(4,929,611	)
Weighted average common shares outstanding		2,704,239			2,790,514			2,704,239			2,790,514
Loss per share - basic and diluted
Continuing operations		(0.21	)		(0.52	)		(1.27	)		(0.50	)
Discontinued operations		—			(0.72	)		(0.01	)		(1.26	)
Loss per share - basic and diluted	$	(0.21	)	$	(1.24	)	$	(1.28	)	$	(1.76	)

Segments

In 2012, the Company determined that the Company's results will be reported as one segment due to the discontinued operations of its WirelessDx segment and since the results of its previously reported ART segment were not quantitatively material and were not regularly reviewed by the Chief Operating and Decision Maker ("CODM").

Research and development

Research and development expenses include costs directly attributable to the conduct of research and development programs primarily related to the development of our software products and improving the efficiency and capabilities of our manufacturing processes. Such costs include salaries, payroll taxes, employee benefit costs, materials, supplies, depreciation on research equipment, and services provided by outside contractors. All costs associated with research and development programs are expensed as incurred.

Reclassification

Reclassifications

Certain reclassifications have been made to prior period amounts to conform to the current period presentation. In 2012, the Company revised prior period balances to correct errors in the revenue recognition of certain Tooling transactions (Note 10).

Note 2. Accounting Policies (Tables)

9 Months Ended

Sep. 30, 2013

Intangible Assets [Abstract]

Intangible Assets

Intangible assets consist of the following:



		September 30, 2013							December 31, 2012
	Estimated Useful Life (in years)	Gross		Accumulated Amortization			Net		Gross		Accumulated Amortization			Net
Patents and Trademarks	13	$	443,201	$	(420,936	)	$	22,265	$	480,750	$	(456,361	)	$	24,389
Patents and Trademarks*	—	141,923		—			141,923		110,702		—			110,702
Trade names	8	33,250		(13,971		)	19,279		33,250		(12,250		)	21,000
Total Intangible assets:		$	618,374	$	(434,907	)	$	183,467	$	624,702	$	(468,611	)	$	156,091

* Patents and Trademarks not yet in service.

Basic and diluted EPS

Basic and diluted EPS computations are as follows:



		Three months ended September 30,						Nine months ended September 30,
		(unaudited)						(unaudited)
		2013			2012 Revised			2013			2012 Revised
Net loss available to common shareholders	$	(565,551	)	$	(3,448,607	)	$	(3,461,413	)	$	(4,929,611	)
Weighted average common shares outstanding		2,704,239			2,790,514			2,704,239			2,790,514
Loss per share - basic and diluted
Continuing operations		(0.21	)		(0.52	)		(1.27	)		(0.50	)
Discontinued operations		—			(0.72	)		(0.01	)		(1.26	)
Loss per share - basic and diluted	$	(0.21	)	$	(1.24	)	$	(1.28	)	$	(1.76	)

Note 3. Inventories (Tables)

9 Months Ended

Sep. 30, 2013

Inventories [Abstract]

Inventories

Inventories consist of the following:



	September 30, 2013		December 31, 2012
Raw materials	$	1,062,042	$	521,908
Work-in-process	302,891		248,159
Finished goods	1,289,078		1,645,037
Total	$	2,654,011	$	2,415,104

Note 4. Plant, Property & Equipment, net (Tables)

9 Months Ended

Sep. 30, 2013

Property, Plant and Equipment [Abstract]

Property, Plant & Equipment, net

Property, plant and equipment consist of the following:



	Asset lives (in years)				September 30, 2013			December 31, 2012
Machinery and equipment		3	to	15	$	13,492,740		$	12,298,011
Building and improvements			20		4,298,556			4,293,725
Vehicles		3	to	5	94,227			94,227
Furniture, fixtures, computers and software		3	to	5	1,263,879			1,246,807
Land					202,492			202,492
Construction in progress					264,750			103,269
Total property, plant and equipment					19,616,644			18,238,531
Less: accumulated depreciation					(12,071,369		)	(11,080,019		)
Property, plant and equipment, net					$	7,545,275		$	7,158,512

- Definition

Tabular disclosure of the useful life and salvage value of long-lived, physical assets that are used in the normal conduct of business to produce goods and services and not intended for resale. Examples include land, buildings, machinery and equipment, and other types of furniture and equipment including, but not limited to, office equipment, furniture and fixtures, and computer equipment and software.

+ References+ Details

Note 6. Income Taxes (Tables)

9 Months Ended

Sep. 30, 2013

Income Taxes [Abstract]

Income Taxes

The following table sets forth certain information regarding the Company's income tax (benefits) provision:



	Three months ended September 30,					Nine months ended September 30,
	2013		2012 Revised			2013		2012 Revised
Income tax (benefit) provision from continuing operations	$	—	$	(296,133	)	$	2,267,969	$	(609,623	)

Note 8. Share-Based Compensation (Tables)

9 Months Ended

Sep. 30, 2013

Share-based Compensation [Abstract]

Stock Option Transactions

The following table sets forth the stock option transactions for the nine months ended September 30, 2013:



	Number of shares		Weighted average exercise price		Weighted average remaining contractual term (years)	Aggregate intrinsic value
Outstanding at December 31, 2012	285,000		$	2.44	4.8	$	—
Exercisable at December 31, 2012	138,900		2.53		3.1	—
Granted	15,000		2.58		9.75	—
Exercised	—		—		—	—
Forfeited/expired	(73,500	)			—	—
Outstanding at September 30, 2013	226,500		6.16		4.62	1,800
Exercisable at September 30, 2013	142,500		$	6.39	3.28	$	—

Non Vested Stock Options

The following table sets forth the status of the Company’s non-vested options for the nine months ended September 30, 2013:



	Number of shares		Weighted average fair value
Non-vested at December 31, 2012	146,100		$	1.22
Granted	15,000		0.82
Vested	(48,300	)	1.50
Forfeited/expired	(28,800	)	1.28
Non-vested at September 30, 2013	84,000		$	0.97

Note 9. Discontinued Operations (Tables)

9 Months Ended

Sep. 30, 2013

Discontinued Operations [Abstract]

Discontinued Operations

The assets and liabilities of the discontinued operations are presented in the unaudited September 30, 2013 and audited December 31, 2012 condensed consolidated balance sheet excluding intercompany loans which exceed net book value listed below:



	September 30, 2013		December 31, 2012
Cash	$	4,285	$	30,882
Prepaid expenses and other assets	—		3,419
Total current assets from discontinued operations	4,285		34,301

Property and equipment, net of impairment and accumulated depreciation of $119,050 and $1,434,937, respectively	—		284,300
Deferred taxes, non-current	—		—
Total non-current assets from discontinued operations	—		284,300
Total assets from discontinued operations	$	4,285	$	318,601
Accounts payable	$	319,937	$	477,324
Accrued expenses	—		123,247
Total current liabilities from discontinued operations	319,937		600,571
Total liabilities from discontinued operations	$	319,937	$	600,571

- Definition

Tabular disclosure of disposal groups, which may include the gain (loss) recognized in the income statement and the income statement caption that includes that gain (loss), amounts of revenues and pretax profit or loss reported in discontinued operations, the classification and carrying value of the assets and liabilities comprising the disposal group, and the segment in which the disposal group was reported. Also may include the amount of adjustments to amounts previously reported in discontinued operations such as resolution of contingencies arising from the disposal transaction or the operations of the component prior to disposal.

+ References+ Details

Note 10. Reclassification of prior periods (Tables)

9 Months Ended

Sep. 30, 2013

Reclassification of prior periods [Abstract]

Reclassification of prior periods, balance sheet

The impact of the errors on the Company's balance sheet as of September 30, 2012 is summarized below:



September 30, 2012	As originally reported		Correction of error adjustment			As revised
Assets
Current assets:
Deferred income taxes	$	—	$	59,493		$	59,493
Deposits, prepaid expenses and other current assets	745,531		222,019			967,550
Total current assets	7,962,690		281,512			8,244,202
Other non-current assets	—		218,299			218,299
Total assets	17,632,493		499,811			18,132,304

Liabilities and Shareholders’ Equity
Current liabilities:
Deferred revenue	—		281,746			281,746
Total current liabilities	5,595,292		281,746			5,877,038
Long-term liabilities:
Long-term deferred revenue	—		309,377			309,377
Total Long-term liabilities	1,068,992		309,377			1,378,369
Total liabilities	6,664,284		591,123			7,255,407
Shareholders’ equity:
Retained earnings	3,139,296		(91,312		)	3,047,984
Total shareholders’ equity	10,968,209		(91,312		)	10,876,897
Total liabilities and shareholders’ equity	17,632,493		499,811			18,132,304

Reclassification of prior periods, statement of operations

The impact of the errors on the Company's statements of operations for the three and nine months ended September 30, 2012 is summarized below:



	Three months ended September 30, 2012								Nine months ended September 30, 2012
	As originally reported			Correction of error adjustment		As revised			As originally reported			Correction of error adjustment			As revised
Net revenues	$	4,839,812		$	119,222	$	4,959,034		$	15,881,161		$	(296,004	)	$	15,585,157
Cost of sales	4,112,599			85,338		4,197,937			13,106,456			(221,930		)	12,884,526
Gross profit	727,213			33,884		761,097			2,774,705			(74,074		)	2,700,631
Loss from operations	(1,774,241		)	33,884		(1,740,357		)	(1,918,649		)	(74,074		)	(1,992,723		)
Loss before taxes	(1,782,569		)	33,884		(1,748,685		)	(1,941,780		)	(74,074		)	(2,015,854		)
Income tax benefit	(309,500		)	13,367		(296,133		)	(580,400		)	(29,223		)	(609,623		)
Loss before discontinued operations	(1,473,069		)	20,517		(1,452,552		)	(1,361,380		)	(44,851		)	(1,406,231		)
Net loss	(3,469,124		)	20,517		(3,448,607		)	(4,884,758		)	(44,851		)	(4,929,611		)
Loss per share - basic and diluted	(1.24		)	0.01		(1.24		)	(1.75		)	(0.02		)	(1.76		)
Weighted average shares outstanding, basic and diluted	2,790,514			2,790,514		2,790,514			2,790,514			2,790,514			2,790,514

Reclassification of prior periods, statement of cash fows

The impact of the errors on the Company's statement of cash flows for nine months ended September 30, 2012 is summarized below:



	Nine months ended September 30, 2012
	As originally reported			Correction of error adjustment			As revised
Net loss	$	(4,884,758	)	$	(44,853	)	$	(4,929,611	)
Deferred income taxes	(575,900		)	(29,223		)	(605,123		)
Changes in operating assets and liabilities:
Deposits, prepaid expenses and other assets	(254,598		)	(221,930		)	(476,528		)
Accrued expenses and other liabilities	(119,498		)	296,004			176,506
Net cash used in operating activities	(1,498,361		)	—			(1,498,361		)

Note 1. Basis of Presentation (Details) (USD $)	Mar. 29, 2013
Revolving line of credit	$ 4,000,000
Commercial term loan	1,500,000
Equipment line of credit	$ 1,000,000

Note 2. Accounting Policies (Details) (USD $)	3 Months Ended
Note 2. Accounting Policies (Details) (USD $)	Jun. 30, 2013	Sep. 30, 2013	Dec. 31, 2012
Accounts, Notes, Loans and Financing Receivable [Line Items]
Allowance for doubtful accounts		$ 40,000	$ 117,098
Tax expense	2,267,969
Accumulated comprehensive income, from foreign currency translation		$ 42,502	$ 42,502
Number of shares outsanding		226,500	285,000

- Definition

Accumulated adjustment, net of tax, that results from the process of translating subsidiary financial statements and foreign equity investments into the reporting currency from the functional currency of the reporting entity, net of reclassification of realized foreign currency translation gains or losses.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef

-Publisher AICPA

-Name Accounting Principles Board Opinion (APB)

-Number 12

-Paragraph 10

-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 2: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Statement of Financial Accounting Standard (FAS)

-Number 130

-Paragraph 17, 18, 19, 22, 23, 24, 25, 26

-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 3: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

-Topic 220

-SubTopic 10

-Section 45

-Paragraph 14

-URI http://asc.fasb.org/extlink&oid=20435746&loc=d3e681-108580

Reference 4: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

-Topic 220

-SubTopic 10

-Section 45

-Paragraph 11

-URI http://asc.fasb.org/extlink&oid=20435746&loc=d3e637-108580

Reference 5: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

-Topic 220

-SubTopic 10

-Section 45

-Paragraph 10A

-Subparagraph (a)

-URI http://asc.fasb.org/extlink&oid=20435746&loc=SL7669646-108580

Reference 6: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

-Topic 220

-SubTopic 10

-Section 45

-Paragraph 14A

-URI http://asc.fasb.org/extlink&oid=20435746&loc=SL7669686-108580

Reference 7: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

-Topic 830

-SubTopic 30

-Section 45

-Paragraph 12

-URI http://asc.fasb.org/extlink&oid=6915805&loc=d3e32022-110900

Reference 8: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

-Topic 830

-SubTopic 30

-Section 50

-Paragraph 1

-URI http://asc.fasb.org/extlink&oid=6450520&loc=d3e32583-110901

Reference 9: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Statement of Financial Accounting Standard (FAS)

-Number 52

-Paragraph 12, 13

-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 10: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Statement of Financial Accounting Standard (FAS)

-Number 133

-Paragraph 45

-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 11: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Statement of Financial Accounting Standard (FAS)

-Number 52

-Paragraph 31

-Subparagraph a

-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

+ Details

Note 2. Accounting Policies Intangible Assets (Details) (USD $)	9 Months Ended
	Sep. 30, 2013	Dec. 31, 2012
Patents and Trademarks [Member]
Estimated useful life (in years)	13
Gross	$ 443,201	$ 480,750
Accumulated amortization	(420,936)	(456,361)
Net	22,265	24,389
Patents and Trademarks not yet in service [Member]
Estimated useful life (in years)	0
Gross	141,923	110,702
Accumulated amortization	0	0
Net	141,923	110,702
Trade Names [Member]
Estimated useful life (in years)	8
Gross	33,250	33,250
Accumulated amortization	(13,971)	(12,250)
Net	19,279	21,000
Total Intangible Assets [Member]
Gross	618,374	624,702
Accumulated amortization	(434,907)	(468,611)
Net	$ 183,467	$ 156,091

Note 2. Accounting Policies Basic and Diluited EPS (Details) (USD $)	3 Months Ended		9 Months Ended
	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012
Basic and Diluted EPS [Line Items]
Net loss available to common shareholders	$ (565,551)	$ (3,448,607)	$ (3,461,413)	$ (4,929,611)
Weighted average common shares outstanding			2,704,239	2,790,514
Continuing operations	$ (0.21)	$ (0.52)	$ (1.27)	$ (0.50)
Discontinued operations	$ 0.00	$ (0.72)	$ (0.01)	$ (1.26)
Loss per share - basic and diluted	$ (0.21)	$ (1.24)	$ (1.28)	$ (1.76)

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Statement of Financial Accounting Standard (FAS)

-Number 95

-Paragraph 28, 29, 30

-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 2: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

-Topic 225

-SubTopic 10

-Section S99

-Paragraph 2

-Subparagraph (SX 210.5-03.18)

-URI http://asc.fasb.org/extlink&oid=6880815&loc=d3e20235-122688

Reference 3: http://www.xbrl.org/2003/role/presentationRef

-Publisher SEC

-Name Regulation S-X (SX)

-Number 210

-Section 04

-Paragraph 20

-Article 9

Reference 4: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

-Topic 944

-SubTopic 225

-Section S99

-Paragraph 1

-Subparagraph (SX 210.7-04.22)

-URI http://asc.fasb.org/extlink&oid=6879464&loc=d3e573970-122913

Reference 5: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Statement of Financial Accounting Standard (FAS)

-Number 130

-Paragraph 10, 15

-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 6: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

-Topic 220

-SubTopic 10

-Section 45

-Paragraph 6

-URI http://asc.fasb.org/extlink&oid=20435746&loc=d3e565-108580

Reference 7: http://www.xbrl.org/2003/role/presentationRef

-Publisher SEC

-Name Regulation S-X (SX)

-Number 210

-Section 03

-Paragraph 19

-Article 5

Reference 8: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

-Topic 230

-SubTopic 10

-Section 45

-Paragraph 28

-URI http://asc.fasb.org/extlink&oid=6943989&loc=d3e3602-108585

Reference 9: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

-Glossary Other Comprehensive Income

-URI http://asc.fasb.org/extlink&oid=6519514

Reference 10: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

-Glossary Net Income

-URI http://asc.fasb.org/extlink&oid=6518256

Reference 11: http://www.xbrl.org/2003/role/presentationRef

-Publisher AICPA

-Name Accounting Research Bulletin (ARB)

-Number 51

-Paragraph 38

-Subparagraph a

-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 12: http://www.xbrl.org/2003/role/presentationRef

-Publisher AICPA

-Name Accounting Research Bulletin (ARB)

-Number 51

-Paragraph A7

-Appendix A

Reference 13: http://www.xbrl.org/2003/role/presentationRef

-Publisher AICPA

-Name Accounting Research Bulletin (ARB)

-Number 51

-Paragraph 38

-Subparagraph d

-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 14: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

-Topic 260

-SubTopic 10

-Section 50

-Paragraph 1

-URI http://asc.fasb.org/extlink&oid=6371337&loc=d3e3550-109257

Reference 15: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

-Topic 944

-SubTopic 225

-Section S99

-Paragraph 1

-Subparagraph (SX 210.7-04.19)

-URI http://asc.fasb.org/extlink&oid=6879464&loc=d3e573970-122913

Reference 16: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Emerging Issues Task Force (EITF)

-Number 87-21

-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

+ Details

Note 3. Inventories (Details) (USD $)	Sep. 30, 2013	Dec. 31, 2012
Inventories [Line Items]
Raw materials	$ 1,062,042	$ 521,908
Work-in-process	302,891	248,159
Finished goods	1,289,078	1,645,037
Total	2,654,011	2,415,104
Silver intentory	446,664	541,804
Reserve for slow moving and obsolete inventory	$ 373,000	$ (317,484)

- Definition

The amount of the valuation account as of the balance sheet date which reduces the carrying amount of inventory to net realizable value; takes into consideration such factors as market value, excessive quantities based on expected sales, technological obsolescence, and shrinkage. May also provide for estimated product returns or price concessions pertaining to product cost.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

-Topic 210

-SubTopic 10

-Section S99

-Paragraph 1

-Subparagraph (SX 210.5-02.6(a))

-URI http://asc.fasb.org/extlink&oid=6877327&loc=d3e13212-122682

Reference 2: http://www.xbrl.org/2003/role/presentationRef

-Publisher SEC

-Name Regulation S-X (SX)

-Number 210

-Section 02

-Paragraph 6

-Subparagraph a

-Article 5

Reference 3: http://www.xbrl.org/2003/role/presentationRef

-Publisher AICPA

-Name Accounting Research Bulletin (ARB)

-Number 43

-Section A

-Paragraph 9

-Chapter 3

-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 4: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

-Topic 330

-SubTopic 10

-Section S99

-Paragraph 2

-Subparagraph (SAB TOPIC 5.BB)

-URI http://asc.fasb.org/extlink&oid=6386940&loc=d3e100047-122729

Reference 5: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

-Topic 235

-SubTopic 10

-Section S99

-Paragraph 4

-Subparagraph (SX 210.12-09)

-URI http://asc.fasb.org/extlink&oid=6881521&loc=d3e24092-122690

Reference 6: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

-Topic 330

-SubTopic 10

-Section 35

-Paragraph 2

-URI http://asc.fasb.org/extlink&oid=6386567&loc=d3e3927-108312

Reference 7: http://www.xbrl.org/2003/role/presentationRef

-Publisher AICPA

-Name Accounting Research Bulletin (ARB)

-Number 43

-Paragraph 14

-Chapter 4

-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 8: http://www.xbrl.org/2003/role/presentationRef

-Publisher AICPA

-Name Accounting Research Bulletin (ARB)

-Number 43

-Paragraph 8, 9, 14

-Chapter 4

-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 9: http://www.xbrl.org/2003/role/presentationRef

-Publisher SEC

-Name Regulation S-X (SX)

-Number 210

-Section 09

-Article 12

+ Details

Note 4. Plant, Property & Equipment, net (Details) (USD $)	9 Months Ended
	Sep. 30, 2013	Sep. 30, 2012	Dec. 31, 2012
Property, Plant and Equipment [Line Items]
Machinery and equipment	$ 13,492,740		$ 12,298,011
Buildings and improvements	4,298,556		4,293,725
Vehicles	94,227		94,227
Furniture, fixtures, computers and software	1,263,879		1,246,807
Land	202,492		202,492
Construction in progress	264,750		103,269
Total property, plant and equipment	19,616,644		18,238,531
Less: accumulated depreciation	(12,071,369)		(11,080,019)
Property, plant and equipment, net	7,545,275		7,158,512
Depreciation expense	$ (1,067,812)	$ (1,069,967)
Minimum [Member]
Property, Plant and Equipment [Line Items]
Machinery and equipment, asset life, years	3
Vehicles, asset life, years	3
Furniture, fixtures, computers and software, asset life, years	3
Maximum [Member]
Property, Plant and Equipment [Line Items]
Machinery and equipment, asset life, years	15
Vehicles, asset life, years	5
Furniture, fixtures, computers and software, asset life, years	5
Service Life [Member]
Property, Plant and Equipment [Line Items]
Building and improvements, asset life, years	20

Note 5. Debt (Details) (USD $)	Sep. 30, 2013	Apr. 30, 2013	Mar. 29, 2013	Jan. 31, 2013	Dec. 31, 2012
Outstanding debt, details [Abstract]
Revolving line of credit			$ 4,000,000
Revolving line of credit, outstanding principal balance	2,399,493				0
Revolving line of credit, interest rate	3.50%
Percent borrowable of net elegible recievables, revolving line of credit	80.00%
Percent borrowable of net eligible raw materials inventory, revolving line of credit	50.00%
Previous demand line of credit, replaced by current revolver		3,000,000
Commercial term loan			1,500,000
Commercial term loan, outstanding amount remaining	1,363,909
Commercial term loan, interest rate	4.25%
Equipment line of credit			1,000,000
Equipment line of credit, outstanding principal balance	177,251
Equipment notes, to acquire production equipment				272,500
Equipment line of credit, interest rate	3.50%
Equipment notes, amount outstanding	$ 234,646

Note 6. Income Taxes (Details) (USD $)	3 Months Ended			9 Months Ended
Note 6. Income Taxes (Details) (USD $)	Sep. 30, 2013	Jun. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012
Income Taxes
Income tax (benefit) provision from continuing operations	$ 0		$ (296,133)	$ 2,267,969	$ (609,623)
Tax expense		2,267,969
Income tax benefit, discontinud operations			$ 1,190,580		$ 1,731,580

- Definition

The sum of the current income tax expense or benefit and the deferred income tax expense or benefit pertaining to pretax Income or Loss from continuing operations; income tax expense or benefit may include interest and penalties on tax uncertainties based on the entity's accounting policy.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

-Topic 235

-SubTopic 10

-Section S99

-Paragraph 1

-Subparagraph (SX 210.4-08.(h))

-URI http://asc.fasb.org/extlink&oid=6881521&loc=d3e23780-122690

Reference 2: http://www.xbrl.org/2003/role/presentationRef

-Publisher SEC

-Name Regulation S-X (SX)

-Number 210

-Section 08

-Paragraph h

-Article 4

Reference 3: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

-Topic 740

-SubTopic 10

-Section 50

-Paragraph 10

-URI http://asc.fasb.org/extlink&oid=6907707&loc=d3e32672-109319

Reference 4: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

-Topic 740

-SubTopic 10

-Section 50

-Paragraph 9

-Subparagraph (a),(b)

-URI http://asc.fasb.org/extlink&oid=6907707&loc=d3e32639-109319

Reference 5: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

-Topic 740

-SubTopic 10

-Section 45

-Paragraph 25

-URI http://asc.fasb.org/extlink&oid=21917399&loc=d3e32247-109318

Reference 6: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Statement of Financial Accounting Standard (FAS)

-Number 109

-Paragraph 45, 46

-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 7: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name FASB Interpretation (FIN)

-Number 48

-Paragraph 15, 16, 19

-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

+ Details

Note 7. Commitments and Contingencies (Details) (USD $)	3 Months Ended		9 Months Ended
Note 7. Commitments and Contingencies (Details) (USD $)	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012
Commitments and Contingencies [Line Items]
Legal matters, approximate costs			$ 700,000
Lease Expense	$ 0	$ 52,854	$ 50,781	$ 158,562

Note 8. Share-Based Compensation (Details) (USD $)	3 Months Ended		9 Months Ended
Note 8. Share-Based Compensation (Details) (USD $)	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012	Dec. 31, 2010
Share-based Compensation Expense [Line Items]
Share-based Compensation Expense	$ 12,900	$ 20,148	$ 40,646	$ 84,650
Cost related to non-vested share-based compensation, not yet recognized	$ 84,761		$ 84,761
Period to recognize cost related to non-vested share-based compensation arrangements	2.83		2.83
Share-based insentive plan [Abstract]
Aggregate shares authorized for issuance					500,000
Common stock included in the '2010 Plan'					400,000
Shares reserved for the '2005 Plan'					100,000
Shares available for future grants '2010 Plan'	375,000		375,000

Note 8. Share-Based Compensation Stock Option Transactions (Details) (USD $)	Sep. 30, 2012	Dec. 31, 2012 Shares outstanding	Dec. 31, 2012 Shares exercisable	Sep. 30, 2013 Granted during period	Sep. 30, 2013 Exercised during period	Sep. 30, 2013 Forfeited/expired during period	Sep. 30, 2013 Shares outstanding	Sep. 30, 2013 Shares exercisable
Share-based Compensation [Line Items]
Number of Shares		285,000	138,900	15,000	0	(73,500)	226,500	142,500
Weighted average exercise price		$ 2.44	$ 2.53	$ 2.58	$ 0		$ 6.16	$ 6.39
Remaining contractual term (years)		4.8	3.1	9.75	0.00	0.00	4.62	3.28
Aggregate intrinsic value	$ 0	$ 0	$ 0	$ 0	$ 0	$ 0	$ 1,800	$ 0

Note 8. Share-Based Compensation Non- Vested Options (Details) (USD $)	9 Months Ended
	Sep. 30, 2013	Dec. 31, 2012
Stock Options [Member]
Share-based Compensation [Line Items]
Non-vested shares, December 31, 2012		146,100
Non-vested options, Granted During Period, Shares	15,000
Non-vested options, Vested During Period, number	(48,300)
Non-vested Options, Forfeited/Expired during period, number	(28,800)
Non-vested shares, September 30, 2013	84,000
Weighted Average [Member]
Share-based Compensation [Line Items]
Non-vested shares, fair value - December 31, 2012		$ 1.22
Non-vested options, Granted During Period, Fair Value	$ 0.82
Non-vested options, Vested During Period, Fair Value	$ 1.50
Non-vested options, Forfeited/Expired during period, Fair Value	$ 1.28
Non-vested shares, fair value - Septemeber 30, 2013	$ 0.97

Note 9. Discontinued Operations (Details) (USD $)	3 Months Ended		9 Months Ended
Note 9. Discontinued Operations (Details) (USD $)	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012
Discontinued operations, details [Abstract]
Net revenues from discontinued operations	$ 0	$ 132,137	$ 0	$ 372,955
Income (loss) from discontinued operations, net	3,977	(1,996,055)	(16,569)	(3,523,380)
Income tax expense, discontined operations		0	0
Income tax benefit, discontinud operations		1,190,580		1,731,580
Unmet performance obligation	$ 1,000,000		$ 1,000,000

Note 9. Discontinued Operations Condensed Balance Sheet (Details) (USD $)	Sep. 30, 2013	Dec. 31, 2012
Condensed Consolidated Balance Sheet
Cash	$ 4,285	$ 30,882
Prepaid expenses and other assets	0	3,419
Total current assets from discontinued operations	4,285	34,301
Property and equipment, net of impairment and accumulated depreciation of $119,050 and $1,434,937, respectively	0	284,300
Deferred taxes, non-current	0	0
Total non-current assets from discontinued operations	0	284,300
Total assets from discontinued operations	4,285	318,601
Accounts payable	319,937	477,324
Accrued expenses	0	123,247
Total current liabilities from discontinued operations	319,937	600,571
Total liabilities from discontinued operations	$ 319,937	$ 600,571

Note 10. Reclassification of prior periods Balance Sheet (Details) (USD $)	Sep. 30, 2012
As Originally Reported [Member]
Current Assets:
Deferred income taxes	$ 0
Deposits, prepaid expenses and other current assets	745,531
Total current assets	7,962,690
Other non-current assets	0
Total assets	17,632,493
Current liabilities:
Deferred revenue	0
Total current liabilities	5,595,292
Long-term liabilities:
Long-term deferred revenue	0
Total long-term liabilities	1,068,992
Total liabilities	6,664,284
Shareholders' equity:
Retained earning	3,139,296
Total shareholders' equity	10,968,209
Total liabilities and shareholders' equity	17,632,493
Correction of error adjustment [Member]
Current Assets:
Deferred income taxes	59,493
Deposits, prepaid expenses and other current assets	222,019
Total current assets	281,512
Other non-current assets	218,299
Total assets	499,811
Current liabilities:
Deferred revenue	281,746
Total current liabilities	281,746
Long-term liabilities:
Long-term deferred revenue	309,377
Total long-term liabilities	309,377
Total liabilities	591,123
Shareholders' equity:
Retained earning	(91,312)
Total shareholders' equity	(91,312)
Total liabilities and shareholders' equity	499,811
As Revised [Member]
Current Assets:
Deferred income taxes	59,493
Deposits, prepaid expenses and other current assets	967,550
Total current assets	8,244,202
Other non-current assets	218,299
Total assets	18,132,304
Current liabilities:
Deferred revenue	281,746
Total current liabilities	5,877,038
Long-term liabilities:
Long-term deferred revenue	309,377
Total long-term liabilities	1,378,369
Total liabilities	7,255,407
Shareholders' equity:
Retained earning	3,047,984
Total shareholders' equity	10,876,897
Total liabilities and shareholders' equity	$ 18,132,304

Note 10. Reclassification of prior periods Statement of Operations (Details) (USD $)	3 Months Ended	9 Months Ended
	Sep. 30, 2012	Sep. 30, 2012
As Originally Reported [Member]
Reclassification of Prior Periods, Statment of Operations [Line Items]
Net revenues	$ 4,839,812	$ 15,881,161
Cost of sales	4,112,599	13,106,456
Gross profit	727,213	2,774,705
Loss from operations	(1,774,241)	(1,918,649)
Loss before taxes	(1,782,569)	(1,941,780)
Income tax benefit	(309,500)	(580,400)
Loss before discontinued operations	(1,473,069)	(1,361,380)
Net loss	(3,469,124)	(4,884,758)
Loss per share - basic and diluted	$ (1.24)	$ (1.75)
Weighted average shares outstanding, basic and diluted	2,790,514	2,790,514
Correction of error adjustment [Member]
Reclassification of Prior Periods, Statment of Operations [Line Items]
Net revenues	119,222	(296,004)
Cost of sales	85,338	(221,930)
Gross profit	33,884	(74,074)
Loss from operations	33,884	(74,074)
Loss before taxes	33,884	(74,074)
Income tax benefit	13,367	(29,223)
Loss before discontinued operations	20,517	(44,851)
Net loss	20,517	(44,851)
Loss per share - basic and diluted	$ 0.01	$ (0.02)
Weighted average shares outstanding, basic and diluted	2,790,514	2,790,514
As Revised [Member]
Reclassification of Prior Periods, Statment of Operations [Line Items]
Net revenues	4,959,034	15,585,157
Cost of sales	4,197,937	12,884,526
Gross profit	761,097	2,700,631
Loss from operations	(1,740,357)	(1,992,723)
Loss before taxes	(1,748,685)	(2,015,854)
Income tax benefit	(296,133)	(609,623)
Loss before discontinued operations	(1,452,552)	(1,406,231)
Net loss	$ (3,448,607)	$ (4,929,611)
Loss per share - basic and diluted	$ (1.24)	$ (1.76)
Weighted average shares outstanding, basic and diluted	2,790,514	2,790,514

Note 10. Reclassification of prior periods Statement of Cash Flows (Details) (USD $)	9 Months Ended
	Sep. 30, 2012
As Originally Reported [Member]
Statement of cash flows, period reclassification [Line Items]
Net loss	$ (4,884,758)
Deferred income taxes	(575,900)
Deposits, prepaid expenses and other assets	(254,598)
Accrued expenses and other liabilities	(119,498)
Net cash used in operating activities	(1,498,361)
Correction of error adjustment [Member]
Statement of cash flows, period reclassification [Line Items]
Net loss	(44,853)
Deferred income taxes	(29,223)
Deposits, prepaid expenses and other assets	(221,930)
Accrued expenses and other liabilities	296,004
Net cash used in operating activities	0
As Revised [Member]
Statement of cash flows, period reclassification [Line Items]
Net loss	(4,929,611)
Deferred income taxes	(605,123)
Deposits, prepaid expenses and other assets	(476,528)
Accrued expenses and other liabilities	176,506
Net cash used in operating activities	$ (1,498,361)

hrt-20130930