SEC XBRL Viewer

Document and Entity Information Document (USD $)	12 Months Ended
Document and Entity Information Document (USD $)	Dec. 31, 2013	Mar. 21, 2014	Jun. 28, 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-K
Document Period End Date	Dec. 31, 2013
Document Fiscal Year Focus	2013
Document Fiscal Period Focus	FY
Amendment Flag	false
Entity Common Stock, Shares Outstanding		2,722,239
Entity Well-known Seasoned Issuer	No
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Public Float			$ 6,548,635

Consolidated Balance Sheets (USD $)	Dec. 31, 2013	Dec. 31, 2012
Current assets:
Cash and cash equivalents	$ 749,766	$ 477,708
Restricted cash	1,000,000	0
Trade accounts receivable, net of allowance for doubtful accounts of $40,000 and $117,098, at December 31,2013 and 2012, respectively	3,803,853	3,181,721
Inventories, net	2,335,291	2,415,104
Deferred income taxes, current portion	0	199,432
Prepaid taxes	0	194,912
Prepaid expenses and other current assets	513,197	574,999
Assets from discontinued operations, current	1,509	34,301
Total current assets	8,403,616	7,078,177
Property, plant and equipment, net	7,579,556	7,158,512
Intangible assets, net	184,517	156,091
Deferred tax assets, non-current portion	0	2,068,538
Other assets	185,595	214,596
Assets from discontinued operations, non-current	0	284,300
Total assets	16,353,284	16,960,214
Current liabilities:
Demand line of credit	0	800,000
Equipment line of credit, current portion	85,387	0
Term notes payable, current portion	335,760	267,043
Accounts payable	2,156,031	2,437,778
Accrued expenses	436,775	393,913
Customer deposits	341,465	121,779
Deferred revenue, current	248,559	315,268
Performance guarantee liability	1,000,000	1,000,000
Liabilities from discontinued operations, current	319,787	600,571
Total current liabilities	4,923,764	5,936,352
Long-term liabilities:
Revolving line of credit	2,774,495	0
Equipment line of credit, non-current portion	538,707	0
Term notes payable, non-current portion	1,179,709	991,213
Subordinated promissory notes	417,769	0
Deferred revenue, non-current	172,316	326,982
Deferred gain on lease	0	8,934
Total-long term liabilities	5,082,996	1,327,129
Total liabilities	10,006,760	7,263,481
Commitments and Contingencies (Note 8)
Shareholders' equity:
Preferred stock, $1 par value; 2,000,000 shares authorized, none issued	0	0
Common stock, $.01 par value; 10,000,000 shares authorized; 3,926,491 issued, 2,722,239 and 2,704,239 outstanding at December 31, 2013 and 2012, respectively	39,265	39,265
Additional paid-in-capital	11,236,236	11,110,575
Treasury stock at cost, 1,204,252 and 1,222,252 shares at December 31, 2013 and 2012, respectively	(3,272,808)	(3,335,268)
Accumulated other comprehensive income	42,502	42,502
(Accumulated deficit) retained earnings	(1,698,671)	1,839,659
Total shareholders’ equity	6,346,524	9,696,733
Total liabilities and shareholders’ equity	$ 16,353,284	$ 16,960,214

Consolidated Balance Sheet Parenthetical (Parentheticals) (USD $)	Dec. 31, 2013	Dec. 31, 2012
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Allowance for doubtful accounts receivable, current	$ 40,000	$ 117,098
Preferred stock, par value per share	$ 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	2,722,239	2,704,239
Treasury stock, shares	1,204,252	1,222,252

Consolidated Statements of Operations (USD $)	12 Months Ended
Consolidated Statements of Operations (USD $)	Dec. 31, 2013	Dec. 31, 2012
Net sales	$ 21,341,052	$ 20,642,570
Cost of sales	18,308,389	17,848,591
Gross profit	3,032,663	2,793,979
Selling and marketing	949,815	921,045
General and administrative	2,704,957	3,102,643
Research and development	335,309	510,463
Goodwill impairment	0	1,479,727
Total operating expenses	3,990,081	6,013,878
Loss from continuing operations	(957,418)	(3,219,899)
Other income (expense):
Interest expense	(319,395)	(23,881)
Other income (expense)	25,646	(9,319)
Total other expense, net	(293,749)	(33,200)
Loss from continuing operations before income taxes	(1,251,167)	(3,253,099)
Income tax provision (benefit)	2,267,969	(875,992)
Net loss from continuing operations	(3,519,136)	(2,377,107)
Discontinued Operations:
Loss from discontinued operations, net of tax benefit of $0 and $1,814,223 in 2013 and 2012, respectively	(19,194)	(3,760,827)
Net loss	$ (3,538,330)	$ (6,137,934)
Loss per share - basic and diluted
Continuing operations	$ (1.30)	$ (0.86)
Discontinued operations	$ (0.01)	$ (1.36)
Loss per share - basic and diluted	$ (1.31)	$ (2.22)
Weighted average common shares outstanding - basic and diluted	2,705,373	2,775,428

Consolidated Statements of Comprehensive Loss Parenthitical (Parentheticals) (USD $)	12 Months Ended
	Dec. 31, 2013	Dec. 31, 2012
Statement of Comprehensive Loss Parenthetical [Abstract]
Tax benefit, discontinued operations	$ 0	$ 1,814,223

Statement of Changes in Shareholders' Equity (USD $)	Total	Common Stock	Additional paid-in capital	Treasury stock	Accumulated other comprehensive income	Retained earnings (accumulated deficit)
Stockholders' equity attributable to parent at Dec. 31, 2011	$ 15,805,975	$ 39,265	$ 10,762,338	$ (3,099,842)	$ 42,502	$ 8,061,712
Shares at Dec. 31, 2011		3,926,491		1,135,977
Share-based compensation	112,811		112,811
Escrow released related to contingent consideration	0		235,426	(235,426)
Escrow released related to contingent consideration, shares	86,275			86,275
Cash dividends	(84,119)					(84,119)
Net loss	(6,137,934)					(6,137,934)
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		1,222,252
Share-based compensation - options	42,611		42,611
Cash dividends	0
Issuance of common stock from treasury, value	62,460			62,460
Issuance of common stock from treasury, shares				(18,000)
Issuance of warrants	83,050		83,050
Net loss	(3,538,330)					(3,538,330)
Stockholders' equity attributable to parent at Dec. 31, 2013	$ 6,346,524	$ 39,265	$ 11,236,236	$ (3,272,808)	$ 42,502	$ (1,698,671)
Shares at Dec. 31, 2013		3,926,491		1,204,252

Consolidated Statements of Cash Flows (USD $)	12 Months Ended
Consolidated Statements of Cash Flows (USD $)	Dec. 31, 2013	Dec. 31, 2012
Cash flows from operating activities:
Net loss	$ (3,538,330)	$ (6,137,934)
Loss from discontinued operations	19,194	3,760,827
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
(Gain) loss on sale of property, plant and equipment	(4,780)	0
Amortization of deferred gain on lease	(8,934)	(4,467)
Goodwill impairment	0	1,479,727
Loss on impairment of patents and trademarks	0	33,192
Depreciation and amortization	1,444,005	1,419,226
Non-cash interest expense	819	0
Change in allowance for doubtful accounts	(77,098)	58,602
Deferred income taxes	2,267,969	(2,684,000)
Share-based compensation expense	105,071	112,811
Changes in operating assets and liabilities:
Accounts receivable	(545,034)	220,046
Inventories	79,813	852,378
Deposits, prepaid expenses and other assets	256,714	45,027
Other non-current assets	29,001	(126,618)
Accounts payable	(281,747)	309,329
Accrued expenses and other current liabilities	195,840	1,158,789
Other non-current liabilities	(154,666)	190,907
Net cash (used in) provided by operating activities of continuing operations	(212,163)	687,842
Net cash used in operating activities of discontinued operations	(277,365)	(1,796,143)
Net cash used in operating activities	(489,528)	(1,108,301)
Cash flows from investing activities:
Purchases of property, plant and equipment	(1,610,152)	(1,294,802)
Proceeds from sale of property, plant and equipment	44,337	306,285
Cash received from federal grant	0	318,627
Cash paid for patents and trademarks	(33,266)	(102,662)
Net cash used in investing activities from continuing operations	(1,599,081)	(772,552)
Net cash provided by (used in) investing activities from discontinued operations	247,992	(466,230)
Net cash used in investing activities	(1,351,089)	(1,238,782)
Cash flows from financing activities:
Proceeds from (payments on) revolving line of credit, net	2,774,495	0
Proceeds from (payments on) demand line of credit, net	(800,000)	800,000
Proceeds from equipment line of credit	624,094	0
Proceeds from term notes payable	1,500,000	935,232
Payments on term notes payable	(1,515,287)	(153,663)
Proceeds from subordinated promissory notes	500,000	0
Cash dividends paid	0	(84,119)
Restricted cash	(1,000,000)	0
Net cash provided by financing activities from continuing operations	2,083,302	1,497,450
Net cash provided by (used in) financing activities from discontinued operations	0	0
Net cash provided by financing activities	2,083,302	1,497,450
Net increase (decrease) in cash and cash equivalents	242,685	(849,633)
Cash and cash equivalents, beginning of year	508,590	1,358,223
Cash and cash equivalents, end of year	751,275	508,590
Less: cash and cash equivalents of discontinued operations at end of year	1,509	30,882
Cash and cash equivalents of continuing operations at end of year	749,766	477,708
Supplemental Cash Flow Information
Cash paid for interest	301,621	8,984
Cash received from tax refunds	198,791
Non-cash activities:
Acquisition of equipment with equipment notes	272,500	476,687
Issuance of warrants	83,050	0
Non-cash activity related to discontinued operations:
Impairment of fixed assets	0	1,063,321
Patent impairment	$ 0	$ 56,912

Note 1 - Description of Business	12 Months Ended
Note 1 - Description of Business	Dec. 31, 2013
Description of Business [Abstract]
Description of Business	Description of Business Arrhythmia Research Technology, Inc., (“ART”), through its wholly-owned subsidiary, Micron Products, Inc. ("Micron", and collectively with ART, the "Company") manufactures components, devices and equipment for medical, military, law enforcement, industrial and automotive applications. The Company also licenses customizable proprietary signal-averaged electrocardiography software through its Predictor brand. The Company's subsidiary, RMDDxUSA Corp. and its Prince Edward Island subsidiary RMDDx Corporation (collectively "WirelessDx"), discontinued operations in the third quarter of 2012. ART was founded in 1986 and completed an initial public offering in 1988 and its shares were listed on the American Stock Exchange (now the NYSE MKT), in 1992. Its stock trades under the symbol HRT. The Company has grown organically and through acquisitions. Today, the Company has diversified manufacturing capabilities with the capacity to participate in full product life cycle activities from early stage development and engineering and prototyping to full scale manufacturing as well as packaging and product fulfillment services. The Company competes globally, with nearly of its revenue derived from exports. Operating matters and liquidity The Company has experienced net operating losses in 2013 and 2012. 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 marketing, capital equipment and human resources. The Company expects to meet its goals in these areas, realize returns on its capital investments 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.

Note 2 - Accounting Policies

12 Months Ended

Dec. 31, 2013

Accounting Policies [Abstract]

Significant Accounting Policies

Accounting Policies

Principles of consolidation

The consolidated financial statements (the "financial statements") include the accounts of ART, Micron and WirelessDx. WirelessDx is presented herein as discontinued operations. All intercompany balances and transactions have been eliminated in consolidation.

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 revenue and expenses during the reporting periods. Actual results could differ from those estimates.

Revenue Recognition

Revenue for product sales 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 ("tooling") and production units. The Company has determined that certain tooling arrangements, and the related production units, represent one unit of accounting, based on an assessment of the respective standalone value. When the Company determines that an arrangement represents one unit of accounting, the revenue is deferred over the estimated product life-cycle, based upon historical knowledge of the customer, 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 and associated products. 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.

Revenue for software license sales 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 accounts receivable and cash and cash equivalents.

Accounts receivable are customer obligations due under normal trade terms. A large portion of the Company's products are sold to large diversified medical, military and law enforcement 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.

During the year ended December 31, 2013, the Company had sales to two customers constituting 16% and 15% of total 2013 net sales. Accounts receivable from these two customers at December 31, 2013 were 16% and 10% of the total accounts receivable balance at year end. During the year ended December 31, 2012, the Company had sales to one customer constituting 28% of total 2012 sales. Accounts receivable from this customer at December 31, 2012 was 19% of the total accounts receivable balance at year end. The loss of any one of these customers could have a significant adverse effect on the Company's financial results.

Sales to the top three customers accounted for 39% of total sales in 2013 compared to 45% of total sales in 2012. The decrease in the top three customers as a percentage of total sales is due to a decrease in sensor sales from the Company’s largest customer due in part to decreased volume and the customer moving to a part with less silver. The decrease from the largest customer was partially offset by increased sales of machined implants from the Company’s second largest customer,

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 (see Note 11).

Accounts Receivable and Allowance for Doubtful Accounts

Accounts receivable represent amounts invoiced by the Company. Management maintains an allowance for doubtful accounts based on information obtained regarding individual accounts and historical experience. Amounts deemed uncollectible are written off against the allowance for doubtful accounts. Bad debts have not had a significant impact on the Company’s financial position, results of operations and cash flows.

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 obsolesce 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.

Goodwill

Goodwill is reviewed for impairment annually, or when events arise that could indicate that impairment exists. The Company's annual goodwill impairment test is conducted at December 31, however during the third quarter of 2012, due to a decline in the market price of the Company's stock, the market capitalization of the Company was below the carrying value and management performed an impairment analysis as of September 30, 2012. Based on the analysis, management determined that the fair value of the reporting unit, in this case, the entire Company, was below the carrying value as of September 30, 2012. The Step 1 analysis was performed using the income approach in which the Company utilized a discounted cash flow analysis to determine the fair value of its reporting unit. The income approach requires management to estimate a number of factors which are considered Level 3 inputs, including projected future operating results, economic projections, anticipated future cash flows and discount rates. As part of its valuation to determine the total impairment charge, the Company is also required to perform a Step 2 analysis which includes estimating the fair value of significant tangible and intangible long-lived assets.

As a result, the Company determined that the full value of its goodwill was impaired and recorded the impairment charge of $1,479,727 in the third quarter of 2012.

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. In 2012, the Company experienced a triggering event as a result of the goodwill impairment as described above and recorded an impairment charge of $33,192 in relation to certain patents also deemed to be impaired. In 2013, no impairment charges were recorded. Intangible assets consist of the following:



		December 31, 2013							December 31, 2012
	Estimated Useful Life (in years)	Gross		Accumulated Amortization			Net		Gross		Accumulated Amortization			Net
Patents and Trademarks	12	$	476,390	$	(454,566	)	$	21,824	$	480,750	$	(456,361	)	$	24,389
Patents and Trademarks pending	—	143,968					143,968		110,702		—			110,702
Trade names	8	33,250		(14,525		)	18,725		33,250		(12,250		)	21,000
Total Intangible assets		$	653,608	$	(469,091	)	$	184,517	$	624,702	$	(468,611	)	$	156,091

Amortization expense related to intangible assets was $4,840 and $5,088 in 2013 and 2012, respectively. Estimated future annual amortization expense for currently amortizing intangible assets is expected to approximate $5,000.

Income taxes

The Company recognizes deferred tax liabilities and assets for the expected future tax consequences of events that have been included in the financial statements or tax returns. Under this method, deferred tax liabilities and assets 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.

The Company files income tax returns in the U.S. Federal jurisdiction, Canadian jurisdiction and various state jurisdictions. The Company follows accounting guidance regarding the recognition, measurement, presentation and disclosure of uncertain tax positions in the financial statements. Tax positions taken or expected to be taken in the course of preparing the Company’s tax returns are required to be evaluated to determine whether the tax positions are “more-likely-than-not” to be upheld under regulatory review. The resulting tax impact of these tax positions, if any, are recognized in the financial statements based on the results of this evaluation. The Company did not recognize any tax liabilities associated with uncertain tax positions, nor have they recognized any interest or penalties related to unrecognized tax positions. Generally, the Company is no longer subject to federal and state tax examinations by tax authorities for years before fiscal years ending December 31, 2010.

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 share-based grant).

Comprehensive income (loss)

The Company has accumulated other comprehensive income of $42,502 from changes in currency valuations with our Canadian operations as of December 31, 2013 and 2012. In the years ended December 31, 2013 and 2012, comprehensive loss equaled net loss and there were no changes in accumulated other comprehensive income.

(Loss) earnings per share data

Basic earnings (loss) per share is computed by dividing net income (loss) available to common shareholders by the weighted average number of common shares outstanding. The computation of diluted earnings (loss) per share is similar to the computation of basic earnings (loss) 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 net income (loss) that would result from the assumed conversions of those potential shares.

As of December 31, 2013 there were options to purchase 256,500 shares and warrants to purchase 100,000 shares outstanding that were anti-dilutive. As of December 31, 2012 there were options to purchase 285,000 options outstanding that were anti-dilutive. Therefore, these options or warrants were not included in the calculation of earnings (loss) per share.

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, technology related to the medical services subsidiary 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 of prior period balances

Certain reclassifications have been made to prior period amounts to conform to the current year presentation.

Note 3 - Inventories

12 Months Ended

Dec. 31, 2013

Inventories [Abstract]

Inventories, net

Inventories consist of the following:



December 31,	2013		2012
Raw materials	$	947,765	$	521,908
Work-in-process	266,431		248,159
Finished goods	1,121,095		1,645,037
Total	$	2,335,291	$	2,415,104

The cost of silver in our inventory as raw materials, in work-in-process or as a plated surface on finished goods had an estimated cost of $382,332 and $541,804 in 2013 and 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 - Property, Plant and Equipment, Net

12 Months Ended

Dec. 31, 2013

Property, Plant and Equipment, Net [Abstract]

Property, Plant and Equipment, Net

Property, plant and equipment consist of the following:



December 31,	Asset Lives (in years)			2013			2012
Machinery and equipment	3	to	15	$	13,734,528		$	12,298,011
Building and improvements		20		4,303,156			4,293,725
Vehicles	3	to	5	94,227			94,227
Furniture, fixtures, computers and software	3	to	5	1,317,189			1,246,807
Land				202,492			202,492
Construction in progress				177,473			103,269
Total property, plant and equipment				19,829,065			18,238,531
Less: accumulated depreciation				(12,249,509		)	(11,080,019		)
Property, plant and equipment, net				$	7,579,556		$	7,158,512

For the year ended December 31, 2013, the Company recorded $1,439,165 of depreciation expense compared to $1,412,170 for the year ended December 31, 2012.

- Definition

The entire disclosure for long-lived, physical assets used in the normal conduct of business and not intended for resale. Includes, but is not limited to, accounting policies and methodology, roll forwards, depreciation, depletion and amortization expense, including composite depreciation, accumulated depreciation, depletion and amortization expense, useful lives and method used, income statement disclosures, assets held for sale and public utility disclosures.

+ References+ Details

Note 5 - Debt

12 Months Ended

Dec. 31, 2013

Debt [Abstract]

Debt

Bank debt

2012

The Company had a demand line of credit with a bank that provided for borrowings based on eligible accounts receivable and inventories. Interest on the demand line of credit was LIBOR plus 2.0%. The balance outstanding on the demand line of credit at December 31, 2012 was $800,000. This line of credit was paid off and closed in April 2013 as part of a new bank facility.

The Company also had a master lease agreement with the bank that allowed for money to be drawn on standard terms for the purchase of equipment. During the twelve months ended December 31, 2012, two equipment notes were entered into under this master lease agreement. In the first quarter of 2012, Micron entered into an equipment note for $523,269. This equipment note was structured in such a way that the Company received a cash payout for amounts already paid to vendors of $262,960, with the remaining $260,309 paid by the bank directly to the equipment vendors making total principal amount of the note entered into $523,269. The cash payout is part of the proceeds from term notes payable on the statement of cash flows. The remaining amount of $260,309 was a non-cash event and is disclosed in the supplemental cash flow schedule. At December 31, 2012, the outstanding balance of this equipment note was $450,758. In the second quarter of 2012, WirelessDx, under this master lease agreement, entered an equipment note for $888,649. This equipment note was structured in such a way that the Company received a cash payout for amounts already paid to vendors of $672,272. The remaining $216,378 was paid by the bank directly to the equipment vendors making total principal amount of the equipment note entered into $888,649. The cash payout is part of the proceeds from term notes payable on the statement of cash flows. The remaining amount of $216,378 was a non-cash event and is disclosed in the supplemental cash flow schedule. This WirelessDx equipment note was guaranteed by ART, therefore, all amounts associated with this note are reflected as part of continuing operations on the balance sheet and statement of cash flows. At December 31, 2012, the outstanding balance of this term note payable was $807,498. The equipment notes under this master lease agreement were paid off in April 2013 as part of a new bank facility.

2013

In March 2013, the Company entered into a multi-year credit facility with a Massachusetts based bank. The credit facility includes a revolving line of credit (the "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 new credit facility was used to pay off the above noted demand line of credit and term notes.

Revolver

The revolver provides for borrowings up to 80% of eligible accounts receivable and 50% of eligible raw materials inventory. The interest rate on the revolver is calculated at the bank's prime rate plus 0.25% (3.50% at December 31, 2013). The revolver has a maturity date of June 2015. The outstanding balance on the revolver at December 31, 2013 is $2,774,495.

Commercial term loan

The commercial term loan from the bank was used to pay off existing debt and to fund other current liabilities of continuing operations. At December 31, 2013, the outstanding amount remaining on the term loan is $1,293,378. The term loan has a five year term with a maturity date of March 2018. The interest rate on the loan is a fixed 4.25% per annum.

Equipment line of credit

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 equipment line of credit requires interest only payments based on the bank’s prime rate plus 0.25% (3.50% at December 31, 2013). The balance outstanding on the equipment line of credit at December 31, 2013 is $624,094. The equipment line of credit converts to a five-year term loan upon the earlier of March 2014 or when the $1.0 million line is fully drawn upon. The term loan will require monthly payments of principal and interest at a fixed rate equal to the greater of 4.25% or the federal home loan bank’s 5-year amortizing rate as of the date of the conversion. The equipment line of credit is included in the balance sheet as current and non-current based on the estimated amortization upon conversion.

Bank covenants

The bank facility 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.

Other debt

Equipment term notes

In January 2013, the Company entered into two equipment notes totaling $272,500 with a financing company to acquire production equipment. The notes bear interest at 4.66% and require monthly payments of principal and interest over the term of five years. The outstanding balance of these equipment notes at December 31, 2013 was $222,091.

Subordinated promissory notes

In December 2013, the Company completed a private offering in which the Company sold an aggregate of $500,000 in subordinated promissory notes. The notes are unsecured and require quarterly interest-only payments at a rate of 10% per annum. On the second anniversary following issuance, the interest rate increases to 12% per annum. The notes mature in December 2016 at which point the outstanding balance is due in full. The subordinated promissory notes may be prepaid by the Company at any time following the first anniversary thereof without penalty. The notes are subordinated to all indebtedness of the Company pursuant to its March 2013 multi-year bank credit facility.

In connection with the subordinated promissory notes, the Company issued warrants to purchase the Company's common stock (see Note 9). In order to account for the subordinated notes payable and warrants, the Company allocated the proceeds between the notes and warrants on a relative fair value basis. As a result, the Company allocated $416,950 to the notes and $83,050 to the warrants. The total discount on the notes is being recognized as non-cash interest expense over the term of the notes. In the year ended December 31, 2013, the Company recorded $819 of non-cash interest expense related to the amortization of the discount. The unamortized discount which is net against the outstanding balance of the subordinated promissory notes is $82,231 at December 31, 2013.

Future maturities of debt for the years ending December 31, are as follows:



	2014		2015		2016		2017		2018		Thereafter		Total
Revolver	$	—	2,774,495		$	—	$	—	$	—	$	—	$	2,774,495
Term debt and equipment notes	335,760		350,424		365,899		382,001		81,385		—		$	1,515,469
Equipment line of credit	85,387		118,159		123,280		128,623		134,197		34,448		$	624,094
Subordinated promissory notes	—		—		500,000		—		—		—		$	500,000
Total	$	421,147	$	3,243,078	$	989,179	$	510,624	$	215,582	$	34,448	$	5,414,058

- 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

12 Months Ended

Dec. 31, 2013

Income Taxes [Abstract]

Income Taxes

The income tax provision (benefit) consists of the following:



Years Ended December 31,	2013		2012
Current:
Federal	$	—	$	—
State	—		(6,717		)
Total current income taxes	—		(6,717		)
Deferred:
Federal	1,437,269		(319,475		)
State	830,700		(549,800		)
Foreign	—		—
Total deferred income taxes	2,267,969		(869,275		)
Total income tax provision (benefit)	$	2,267,969	$	(875,992	)

The components of deferred income taxes are as follows:



Years Ended December 31,	2013			2012
Deferred income taxes:
Current deferred tax assets:
Inventories	$	111,800		$	89,900
Bad debt reserve	63,200			93,600
Accrued Expenses	104,900			68,900
Total current deferred tax assets	279,900			252,400
Long-term deferred tax assets:
Net operating loss carryforwards	2,696,400			2,290,400
Foreign net operating loss carryforwards	291,100			287,500
Federal and state tax credit carryforwards	431,900			298,300
Patents and intangibles	99,100			115,200
Stock compensation	89,800			81,300
Other long term	474,500			447,500
Total long-term deferred tax assets	4,082,800			3,520,200
Total deferred tax assets	4,362,700			3,772,600

Current deferred tax liabilities:
Prepaid expenses	(50,400		)	(53,000		)
Long-term deferred tax liabilities:
Property, plant and equipment	(934,100		)	(980,800		)
Total deferred tax liabilities	(984,500		)	(1,033,800		)
Deferred tax valuation allowance	(3,378,200		)	(470,900		)
Net deferred tax assets (liabilities)	$	—		$	2,267,900

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, created uncertainty regarding the Company's ability to realize 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 full 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 all 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 and identified the second quarter of 2013 as the appropriate period to record a full valuation allowance on its deferred tax assets, resulting in the recognition of a $2,267,969 tax expense. The Company assesses the need for the valuation allowance on a quarterly basis. If and when the Company determines that the valuation allowance should be reversed, the adjustment would result in a tax benefit in the consolidated statements of operations.

In 2013, the total valuation allowance for continuing operations increased $2,907,300 from 2012.

In 2012, the Company had recorded a valuation allowance against the foreign portion of its deferred tax assets of discontinued operations of $470,900, an increase of $119,000 from 2011.

For the year ended December 31, 2013, the Company has federal, state and foreign net operating loss carryforwards totaling $7,420,000, $10,471,000 and $1,039,000 respectively, which begin to expire in 2030. The Company also had federal and state tax credit carryovers of $243,000 and $188,900, respectively. The federal and state credits begin to expire in 2026 and 2014, respectively.

The Company files a consolidated federal income tax return. The actual income tax provision differs from applying the Federal statutory income tax rate (34%) to the pre-income tax loss from continuing operations as follows:



Years Ended December 31,	2013			2012
Tax (benefit) provision computed at statutory rate	$	(425,395	)	$	(1,106,054	)
Increases (reductions) due to:
Change in valuation allowance	2,907,300			—
State income taxes, net of federal benefit	(58,045		)	(299,200		)
Goodwill impairment	—			422,900
Permanent differences	12,660			20,500
Tax credits (federal and state)	(96,133		)	—
Differences on prior returns (federal and state)	(64,867		)	59,500
Other	(7,551		)	26,362
Income tax provision (benefit)	$	2,267,969		$	(875,992	)

- 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+ Details

Note 7 - Employee Benefit Plans	12 Months Ended
Note 7 - Employee Benefit Plans	Dec. 31, 2013
7. Employee Benefit Plans [Abstract]
Employee Benefit Plans	Employee Benefit Plans The Company sponsors an Employee Savings and Investment Plan under Section 401(k) of the Internal Revenue Code covering all eligible employees of the Company. Employees can contribute up to 90% of their eligible compensation to the maximum allowable by the IRS. The Company’s matching contributions are at the discretion of the Company. The Company’s matching contributions in 2013 and 2012 were $44,488 and $43,149, respectively.

- Definition

Tabular disclosure of one or more of the entity's defined benefit pension plans or one or more other defined benefit postretirement plans, separately for pension plans and other postretirement benefit plans including the entity's schedule of fair value of plan assets for defined benefit or other postretirement plans.

+ References+ Details

Note 8 - Commitments and Contingencies	12 Months Ended
Note 8 - Commitments and Contingencies	Dec. 31, 2013
Commitments and Contingencies Disclosure [Abstract]
Commitments and Contingencies	Commitments and Contingencies Legal Matters In the ordinary course of its business, the Company is involved in various legal proceedings involving a variety of matters. The Company does not believe there are any pending legal proceedings that will have a material impact on the Company’s financial position or results of operations. With respect to a specific matter, a third party has asserted a claim of approximately $100,000 against the Company. Management believes that the Company has meritorious defenses to defend this matter and that the maximum reasonably possible loss is substantially less that the amount asserted. Management believes that the ultimate resolution of this matter, including likely recoveries from insurance carriers if an unfavorable outcome occurs, will not have a material adverse effect on our results of operations or financial condition. Severance Agreements In September 2013, the Company's former Chief Financial Officer resigned and the Company entered into a severance agreement with the former Chief Financial Officer. The Company accrued the full amount of the severance package in the amount of $92,061 (salary and benefits) in the third quarter of 2013. The severance agreement provides for payments through September 2014 and the balance outstanding as of December 31, 2013 is $69,673 and is included within accounts payable and accrued expenses.

Note 9 - Shareholders Equity

12 Months Ended

Dec. 31, 2013

Stock Options [Abstract]

Stock Options

Shareholders’ equity

Common stock

In the fourth quarter of 2013 an aggregate of 18,000 shares were issued to the three independent members of the Board of Directors of the Company pursuant to the Company's 2010 Equity Incentive Plan. The Company recorded $62,460 of non-cash compensation expense in connection with this share issuance.

In the fourth quarter of 2012, it was determined that WirelessDx did not meet certain milestones as defined in the original purchase and sale agreement. The agreement had provided for contingent consideration in the form of shares of common stock of the Company. These shares were held in escrow to either (1) be released to certain previous shareholders of WirelessDx upon achieving the milestones, or (2) be returned to the Company upon notice that the milestones had not been achieved. Once the Company determined that the milestones had not been achieved, the Company notified the escrow agent and requested the return of the shares to the Company. Management has recorded the return of the 86,275 shares into treasury stock in the amount of $235,426.

No dividends were declared or paid in 2013. On January 25, 2012, the Board of Directors declared a one time cash dividend of $0.03 per share. The dividend of $84,119 was paid March 15, 2012.

Warrants

In connection with the subordinated promissory notes issued in December 2013 (see Note 5), the Company issued warrants to purchase 100,000 shares of the Company’s common stock. The warrants are exercisable during the period commencing six months after issuance and for three years from issuance, at an exercise price equal to $3.51 per share, namely, the closing market price of the Company’s common stock on the day prior to the closing date of the offering. The warrants expire in December 2016.

Stock options and Share-Based Incentive Plan

In March 2010, the Company's Board of Directors adopted the Arrhythmia Research Technology, Inc. 2010 Equity Incentive Plan (the “2010 Plan”). 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 had 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 Company now has one plan providing the Company flexibility to award a mix of stock options, equity incentive grants, performance awards and other types of stock-based compensation to certain eligible employees, non-employee directors, or consultants and under which an aggregate of 500,000 shares have been reserved for such grants. The options granted have either six or ten year contractual terms and either vest immediately or vest annually over a five-year term. At December 31, 2013, there were 256,500 shares outstanding and 336,500 shares available for future grants under the 2010 Plan.

The fair value of each stock option award is estimated on the date of grant using the Black-Scholes option pricing model that uses the assumptions noted in the following table. Expected volatilities are based on historical volatility of the Common Stock using historical periods consistent with the expected term of the options. The expected term of options granted under the Company’s equity incentive plan, all of which qualify as “plain vanilla,” is based on the average of the contractual term and the vesting period as permitted under SEC Staff Accounting Bulletin Nos. 107 and 110. The risk-free rate is based on the yield of a U.S. Treasury security with a term consistent with the option.

There were no new option grants in 2012. The assumptions used to measure the fair value of option grants in 2013 were as follows:



	2013
Expected option term		6.50
Expected volatility factor	29%	to	31%
Risk-free rate	0.36%	to	0.68%
Expected annual dividend yield		—%

The following table sets forth the stock option transactions for the year ended December 31, 2013:



	Number of options		Weighted average Exercise Price		Weighted average remaining contractual term (in years)	Aggregate Intrinsic Value
Outstanding at December 31, 2012	285,000		$	2.44	4.8	$	—
Granted	67,500		3.43		9.8	8,850
Exercised	—		—		—	—
Forfeited/expired	(96,000	)	4.20		—	—
Outstanding at December 31, 2013	256,500		$	5.61	5.3	—

Exercisable at December 31, 2013	120,000		$	6.34	2.5	$	8,850
Exercisable at December 31, 2012	138,900		$	2.53	3.1	$	—

For the years ended December 31, 2013 and 2012, share-based compensation expense related to stock options and the non-cash issuance of common stock amounted to $105,071 and $112,811, respectively, and is included in general and administrative expenses. As of December 31, 2013, there was $133,531 of unrecognized compensation cost related to non-vested share-based compensation arrangements granted under the stock option plans. This cost is expected to be recognized over a weighted average period of 1.5 years. The weighted average grant date fair value of options issued in 2013 was $1.03. There were no options granted in 2012.

- Definition

The entire disclosure for compensation-related costs for equity-based compensation, which may include disclosure of policies, compensation plan details, allocation of equity compensation, incentive distributions, equity-based arrangements to obtain goods and services, deferred compensation arrangements, employee stock ownership plan details and employee stock purchase plan details.

+ References+ Details

Note 10 - Industry and Geographic Segments

12 Months Ended

Dec. 31, 2013

Industry and Geographic Segments [Abstract]

Industry and Geographic Segments

The Company’s Chief Operating and Decision Maker ("CODM") manages the operations and reviews the results of operations as a single reporting unit. While the Company operates its business as one segment, the Company has diversified manufacturing capabilities as evidenced by its product offerings across several industry categories supporting customers around the globe.

The following table sets forth, for the periods indicated, the consolidated revenues and percentages of revenues from continuing operations derived from the sales of the Company's products and services in certain industry segments.



	Revenues for the Years Ended December 31,
	2013		%	2012		%
Medical	$	17,459,309	82	$	17,453,573	84
Military and Law Enforcement	1,499,428		7	1,293,662		6
Industrial	1,382,913		6	525,069		3
Consumer Products	618,361		3	838,956		4
Other	381,041		2	531,310		3
Total	$	21,341,052	100	$	20,642,570	100

The following table sets forth, for the periods indicated, the consolidated revenues and percentages of revenues from continuing operations derived from the sales of all of the Company's products and services in certain geographic markets.



	Revenues for the Years Ended December 31,
	2013		%	2012		%
United States	$	11,642,242	55	$	8,955,831	43
Canada	3,625,470		17	5,691,931		28
Europe	1,639,986		8	1,653,171		8
Pacific Rim	2,635,619		12	1,949,558		9
Other	1,797,735		8	2,392,079		12
Total	$	21,341,052	100	$	20,642,570	100

- Definition

The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments.

+ References

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

-Publisher FASB

-Name Accounting Standards Codification

-Topic 280

-SubTopic 10

-Section 50

-Paragraph 1

-URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8380-108599

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

-Publisher FASB

-Name Accounting Standards Codification

-Topic 280

-SubTopic 10

-Section 50

-Paragraph 32

-URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8933-108599

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

-Publisher FASB

-Name Accounting Standards Codification

-Topic 280

-SubTopic 10

-Section 50

-Paragraph 10

-URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8538-108599

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

-Publisher FASB

-Name Accounting Standards Codification

-Topic 280

-SubTopic 10

-Section 50

-Paragraph 26

-URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8844-108599

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

-Publisher FASB

-Name Accounting Standards Codification

-Topic 280

-SubTopic 10

-Section 50

-Paragraph 29

-URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8864-108599

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

-Publisher FASB

-Name Accounting Standards Codification

-Topic 280

-SubTopic 10

-Section 50

-Paragraph 34

-URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8981-108599

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

-Publisher FASB

-Name Accounting Standards Codification

-Topic 280

-SubTopic 10

-Section 50

-Paragraph 35

-URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8984-108599

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

-Publisher FASB

-Name Accounting Standards Codification

-Topic 280

-SubTopic 10

-Section 50

-Paragraph 41

-URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e9038-108599

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

-Publisher FASB

-Name Accounting Standards Codification

-Topic 280

-SubTopic 10

-Section 50

-Paragraph 30

-URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8906-108599

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

-Publisher FASB

-Name Accounting Standards Codification

-Topic 280

-SubTopic 10

-Section 50

-Paragraph 42

-URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e9054-108599

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

-Publisher FASB

-Name Accounting Standards Codification

-Topic 280

-SubTopic 10

-Section 50

-Paragraph 31

-URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8924-108599

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

-Publisher FASB

-Name Accounting Standards Codification

-Topic 280

-SubTopic 10

-Section 50

-Paragraph 40

-URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e9031-108599

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

-Publisher FASB

-Name Accounting Standards Codification

-Topic 280

-SubTopic 10

-Section 50

-Paragraph 33

-URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8971-108599

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

-Publisher FASB

-Name Accounting Standards Codification

-Topic 280

-SubTopic 10

-Section 50

-Paragraph 12

-URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8595-108599

+ Details

Note 11 - Discontinued Operations

12 Months Ended

Dec. 31, 2013

Discontinued Operations [Abstract]

Discontinued Operations

In July 2012, the Board of Directors authorized the Company's management to consider strategic alternatives, on the most favorable terms it can obtain, for all or some portion of the assets of the WirelessDx subsidiaries. On September 4, 2012, the Board, on the recommendation of management, authorized the discontinuance of operations and disposition of the assets of WirelessDx.

Net revenues from discontinued operations for the years ended December 31, 2013 and 2012 were $0 and $372,955, respectively. Net loss from discontinued operations for the years ended December 31, 2013 and 2012 were $19,194 and $3,760,827, respectively, presented net of tax of $0 and a tax benefit of $1,814,223, respectively.

At December 31, 2013 and 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 $1,000,000 of restricted cash at December 31, 2013 as compared to a $1.0 million letter of credit at December 31, 2012. In April 2013, as part of the new bank facility, this letter of credit was replaced with $1.0 million in restricted cash. At both December 31, 2013 and 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 listed below:



Years ended December 31,	2013		2012
Cash	$	1,509	$	30,882
Prepaid expenses and other assets	—		3,419
Total current assets from discontinued operations	1,509		34,301
Property and equipment, net of impairment and accumulated depreciation of $0 and $1,434,947, respectively	—		284,300
Total non-current assets from discontinued operations	—		284,300
Total assets from discontinued operations	$	1,509	$	318,601
Accounts payable and accrued expenses	319,787		600,571
Total current liabilities from discontinued operations	319,787		600,571
Total liabilities from discontinued operations	$	319,787	$	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).

+ References

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

-Publisher FASB

-Name Accounting Standards Codification

-Topic 360

-SubTopic 10

-Section 50

-Paragraph 3

-URI http://asc.fasb.org/extlink&oid=6391110&loc=d3e2941-110230

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

-Publisher FASB

-Name Accounting Standards Codification

-Topic 205

-SubTopic 20

-Section 50

-Paragraph 1

-URI http://asc.fasb.org/extlink&oid=6360339&loc=d3e1361-107760

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

-Publisher FASB

-Name Accounting Standards Codification

-Topic 205

-SubTopic 20

-Section 45

-Paragraph 3

-URI http://asc.fasb.org/extlink&oid=6892542&loc=d3e957-107759

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

-Publisher FASB

-Name Accounting Standards Codification

-Topic 205

-SubTopic 20

-Section 45

-Paragraph 4

-URI http://asc.fasb.org/extlink&oid=6892542&loc=d3e1012-107759

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

-Publisher FASB

-Name Accounting Standards Codification

-Topic 205

-SubTopic 20

-Section 50

-Paragraph 5

-URI http://asc.fasb.org/extlink&oid=6360339&loc=d3e1510-107760

Reference 6: 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 7: 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 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 205

-SubTopic 20

-Section 50

-Paragraph 2

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

+ Details

Note 2 - Accounting Policies (Policies)

12 Months Ended

Dec. 31, 2013

Accounting Policies [Abstract]

Principles of consolidation

The consolidated financial statements (the "financial statements") include the accounts of ART, Micron and WirelessDx. WirelessDx is presented herein as discontinued operations. All intercompany balances and transactions have been eliminated in consolidation.

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 revenue and expenses during the reporting periods. Actual results could differ from those estimates.

Revenue Recognition

Revenue for product sales 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 ("tooling") and production units. The Company has determined that certain tooling arrangements, and the related production units, represent one unit of accounting, based on an assessment of the respective standalone value. When the Company determines that an arrangement represents one unit of accounting, the revenue is deferred over the estimated product life-cycle, based upon historical knowledge of the customer, 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 and associated products. 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.

Revenue for software license sales 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 accounts receivable and cash and cash equivalents.

Accounts receivable are customer obligations due under normal trade terms. A large portion of the Company's products are sold to large diversified medical, military and law enforcement 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.

During the year ended December 31, 2013, the Company had sales to two customers constituting 16% and 15% of total 2013 net sales. Accounts receivable from these two customers at December 31, 2013 were 16% and 10% of the total accounts receivable balance at year end. During the year ended December 31, 2012, the Company had sales to one customer constituting 28% of total 2012 sales. Accounts receivable from this customer at December 31, 2012 was 19% of the total accounts receivable balance at year end. The loss of any one of these customers could have a significant adverse effect on the Company's financial results.

Sales to the top three customers accounted for 39% of total sales in 2013 compared to 45% of total sales in 2012. The decrease in the top three customers as a percentage of total sales is due to a decrease in sensor sales from the Company’s largest customer due in part to decreased volume and the customer moving to a part with less silver. The decrease from the largest customer was partially offset by increased sales of machined implants from the Company’s second largest customer,

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 (see Note 11).

Allowance for doubtful accounts

Accounts Receivable and Allowance for Doubtful Accounts

Accounts receivable represent amounts invoiced by the Company. Management maintains an allowance for doubtful accounts based on information obtained regarding individual accounts and historical experience. Amounts deemed uncollectible are written off against the allowance for doubtful accounts. Bad debts have not had a significant impact on the Company’s financial position, results of operations and cash flows.

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 obsolesce 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.

Goodwill and indefinite-lived intangibles

Goodwill

Goodwill is reviewed for impairment annually, or when events arise that could indicate that impairment exists. The Company's annual goodwill impairment test is conducted at December 31, however during the third quarter of 2012, due to a decline in the market price of the Company's stock, the market capitalization of the Company was below the carrying value and management performed an impairment analysis as of September 30, 2012. Based on the analysis, management determined that the fair value of the reporting unit, in this case, the entire Company, was below the carrying value as of September 30, 2012. The Step 1 analysis was performed using the income approach in which the Company utilized a discounted cash flow analysis to determine the fair value of its reporting unit. The income approach requires management to estimate a number of factors which are considered Level 3 inputs, including projected future operating results, economic projections, anticipated future cash flows and discount rates. As part of its valuation to determine the total impairment charge, the Company is also required to perform a Step 2 analysis which includes estimating the fair value of significant tangible and intangible long-lived assets.

As a result, the Company determined that the full value of its goodwill was impaired and recorded the impairment charge of $1,479,727 in the third quarter of 2012.

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. In 2012, the Company experienced a triggering event as a result of the goodwill impairment as described above and recorded an impairment charge of $33,192 in relation to certain patents also deemed to be impaired. In 2013, no impairment charges were recorded. Intangible assets consist of the following:



		December 31, 2013							December 31, 2012
	Estimated Useful Life (in years)	Gross		Accumulated Amortization			Net		Gross		Accumulated Amortization			Net
Patents and Trademarks	12	$	476,390	$	(454,566	)	$	21,824	$	480,750	$	(456,361	)	$	24,389
Patents and Trademarks pending	—	143,968					143,968		110,702		—			110,702
Trade names	8	33,250		(14,525		)	18,725		33,250		(12,250		)	21,000
Total Intangible assets		$	653,608	$	(469,091	)	$	184,517	$	624,702	$	(468,611	)	$	156,091

Amortization expense related to intangible assets was $4,840 and $5,088 in 2013 and 2012, respectively. Estimated future annual amortization expense for currently amortizing intangible assets is expected to approximate $5,000.

Income taxes

The Company recognizes deferred tax liabilities and assets for the expected future tax consequences of events that have been included in the financial statements or tax returns. Under this method, deferred tax liabilities and assets 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.

The Company files income tax returns in the U.S. Federal jurisdiction, Canadian jurisdiction and various state jurisdictions. The Company follows accounting guidance regarding the recognition, measurement, presentation and disclosure of uncertain tax positions in the financial statements. Tax positions taken or expected to be taken in the course of preparing the Company’s tax returns are required to be evaluated to determine whether the tax positions are “more-likely-than-not” to be upheld under regulatory review. The resulting tax impact of these tax positions, if any, are recognized in the financial statements based on the results of this evaluation. The Company did not recognize any tax liabilities associated with uncertain tax positions, nor have they recognized any interest or penalties related to unrecognized tax positions. Generally, the Company is no longer subject to federal and state tax examinations by tax authorities for years before fiscal years ending December 31, 2010.

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 share-based grant).

Comprehensive income (loss)

The Company has accumulated other comprehensive income of $42,502 from changes in currency valuations with our Canadian operations as of December 31, 2013 and 2012. In the years ended December 31, 2013 and 2012, comprehensive loss equaled net loss and there were no changes in accumulated other comprehensive income.

(Loss) earnings per share data

Basic earnings (loss) per share is computed by dividing net income (loss) available to common shareholders by the weighted average number of common shares outstanding. The computation of diluted earnings (loss) per share is similar to the computation of basic earnings (loss) 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 net income (loss) that would result from the assumed conversions of those potential shares.

As of December 31, 2013 there were options to purchase 256,500 shares and warrants to purchase 100,000 shares outstanding that were anti-dilutive. As of December 31, 2012 there were options to purchase 285,000 options outstanding that were anti-dilutive. Therefore, these options or warrants were not included in the calculation of earnings (loss) per share.

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, technology related to the medical services subsidiary 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 of prior period balances

Certain reclassifications have been made to prior period amounts to conform to the current year presentation.

Note 2 - Accounting Policies (Tables)

12 Months Ended

Dec. 31, 2013

Accounting Policies [Abstract]

Intangible Assets

Intangible assets consist of the following:



		December 31, 2013							December 31, 2012
	Estimated Useful Life (in years)	Gross		Accumulated Amortization			Net		Gross		Accumulated Amortization			Net
Patents and Trademarks	12	$	476,390	$	(454,566	)	$	21,824	$	480,750	$	(456,361	)	$	24,389
Patents and Trademarks pending	—	143,968					143,968		110,702		—			110,702
Trade names	8	33,250		(14,525		)	18,725		33,250		(12,250		)	21,000
Total Intangible assets		$	653,608	$	(469,091	)	$	184,517	$	624,702	$	(468,611	)	$	156,091

Note 3 - Inventories (Tables)

12 Months Ended

Dec. 31, 2013

Inventory [Abstract]

Inventories, net

Inventories consist of the following:



December 31,	2013		2012
Raw materials	$	947,765	$	521,908
Work-in-process	266,431		248,159
Finished goods	1,121,095		1,645,037
Total	$	2,335,291	$	2,415,104

Note 4 - Property, Plant and Equipment, Net (Tables)

12 Months Ended

Dec. 31, 2013

Property, Plant and Equipment [Abstract]

Property, Plant and Equipment, Net

Property, plant and equipment consist of the following:



December 31,	Asset Lives (in years)			2013			2012
Machinery and equipment	3	to	15	$	13,734,528		$	12,298,011
Building and improvements		20		4,303,156			4,293,725
Vehicles	3	to	5	94,227			94,227
Furniture, fixtures, computers and software	3	to	5	1,317,189			1,246,807
Land				202,492			202,492
Construction in progress				177,473			103,269
Total property, plant and equipment				19,829,065			18,238,531
Less: accumulated depreciation				(12,249,509		)	(11,080,019		)
Property, plant and equipment, net				$	7,579,556		$	7,158,512

Note 5 - Debt (Tables)

12 Months Ended

Dec. 31, 2013

Debt [Abstract]

Future Minimum Debt Payments

Future maturities of debt for the years ending December 31, are as follows:



	2014		2015		2016		2017		2018		Thereafter		Total
Revolver	$	—	2,774,495		$	—	$	—	$	—	$	—	$	2,774,495
Term debt and equipment notes	335,760		350,424		365,899		382,001		81,385		—		$	1,515,469
Equipment line of credit	85,387		118,159		123,280		128,623		134,197		34,448		$	624,094
Subordinated promissory notes	—		—		500,000		—		—		—		$	500,000
Total	$	421,147	$	3,243,078	$	989,179	$	510,624	$	215,582	$	34,448	$	5,414,058

Note 6 - Income Taxes (Tables)

12 Months Ended

Dec. 31, 2013

Income Taxes [Abstract]

Income tax provision (benefit)

The income tax provision (benefit) consists of the following:



Years Ended December 31,	2013		2012
Current:
Federal	$	—	$	—
State	—		(6,717		)
Total current income taxes	—		(6,717		)
Deferred:
Federal	1,437,269		(319,475		)
State	830,700		(549,800		)
Foreign	—		—
Total deferred income taxes	2,267,969		(869,275		)
Total income tax provision (benefit)	$	2,267,969	$	(875,992	)

Deferred income taxes

The components of deferred income taxes are as follows:



Years Ended December 31,	2013			2012
Deferred income taxes:
Current deferred tax assets:
Inventories	$	111,800		$	89,900
Bad debt reserve	63,200			93,600
Accrued Expenses	104,900			68,900
Total current deferred tax assets	279,900			252,400
Long-term deferred tax assets:
Net operating loss carryforwards	2,696,400			2,290,400
Foreign net operating loss carryforwards	291,100			287,500
Federal and state tax credit carryforwards	431,900			298,300
Patents and intangibles	99,100			115,200
Stock compensation	89,800			81,300
Other long term	474,500			447,500
Total long-term deferred tax assets	4,082,800			3,520,200
Total deferred tax assets	4,362,700			3,772,600

Current deferred tax liabilities:
Prepaid expenses	(50,400		)	(53,000		)
Long-term deferred tax liabilities:
Property, plant and equipment	(934,100		)	(980,800		)
Total deferred tax liabilities	(984,500		)	(1,033,800		)
Deferred tax valuation allowance	(3,378,200		)	(470,900		)
Net deferred tax assets (liabilities)	$	—		$	2,267,900

Federal income taxes

The Company files a consolidated federal income tax return. The actual income tax provision differs from applying the Federal statutory income tax rate (34%) to the pre-income tax loss from continuing operations as follows:



Years Ended December 31,	2013			2012
Tax (benefit) provision computed at statutory rate	$	(425,395	)	$	(1,106,054	)
Increases (reductions) due to:
Change in valuation allowance	2,907,300			—
State income taxes, net of federal benefit	(58,045		)	(299,200		)
Goodwill impairment	—			422,900
Permanent differences	12,660			20,500
Tax credits (federal and state)	(96,133		)	—
Differences on prior returns (federal and state)	(64,867		)	59,500
Other	(7,551		)	26,362
Income tax provision (benefit)	$	2,267,969		$	(875,992	)

Note 9 - Shareholders Equity (Tables)

12 Months Ended

Dec. 31, 2013

Stock Options [Abstract]

Fair Value of Option Grants

There were no new option grants in 2012. The assumptions used to measure the fair value of option grants in 2013 were as follows:



	2013
Expected option term		6.50
Expected volatility factor	29%	to	31%
Risk-free rate	0.36%	to	0.68%
Expected annual dividend yield		—%

Stock Option Transactions

The following table sets forth the stock option transactions for the year ended December 31, 2013:



	Number of options		Weighted average Exercise Price		Weighted average remaining contractual term (in years)	Aggregate Intrinsic Value
Outstanding at December 31, 2012	285,000		$	2.44	4.8	$	—
Granted	67,500		3.43		9.8	8,850
Exercised	—		—		—	—
Forfeited/expired	(96,000	)	4.20		—	—
Outstanding at December 31, 2013	256,500		$	5.61	5.3	—

Exercisable at December 31, 2013	120,000		$	6.34	2.5	$	8,850
Exercisable at December 31, 2012	138,900		$	2.53	3.1	$	—

Note 10 - Industry and Geographic Segments (Tables)

12 Months Ended

Dec. 31, 2013

Industry and Geographic Segments [Abstract]

Sales by Industry Segment

The following table sets forth, for the periods indicated, the consolidated revenues and percentages of revenues from continuing operations derived from the sales of the Company's products and services in certain industry segments.



	Revenues for the Years Ended December 31,
	2013		%	2012		%
Medical	$	17,459,309	82	$	17,453,573	84
Military and Law Enforcement	1,499,428		7	1,293,662		6
Industrial	1,382,913		6	525,069		3
Consumer Products	618,361		3	838,956		4
Other	381,041		2	531,310		3
Total	$	21,341,052	100	$	20,642,570	100

Sales by Geographic Market

The following table sets forth, for the periods indicated, the consolidated revenues and percentages of revenues from continuing operations derived from the sales of all of the Company's products and services in certain geographic markets.



	Revenues for the Years Ended December 31,
	2013		%	2012		%
United States	$	11,642,242	55	$	8,955,831	43
Canada	3,625,470		17	5,691,931		28
Europe	1,639,986		8	1,653,171		8
Pacific Rim	2,635,619		12	1,949,558		9
Other	1,797,735		8	2,392,079		12
Total	$	21,341,052	100	$	20,642,570	100

- Definition

Tabular disclosure of the profit or loss and total assets for each reportable segment. An entity discloses certain information on each reportable segment if the amounts (a) are included in the measure of segment profit or loss reviewed by the chief operating decision maker or (b) are otherwise regularly provided to the chief operating decision maker, even if not included in that measure of segment profit or loss.

+ References+ Details

Note 11 - Discontinued Operations (Tables)

12 Months Ended

Dec. 31, 2013

Discontinued Operations [Abstract]

Assets and Liabilities of Discontinued Operations

The assets and liabilities of the discontinued operations are listed below:



Years ended December 31,	2013		2012
Cash	$	1,509	$	30,882
Prepaid expenses and other assets	—		3,419
Total current assets from discontinued operations	1,509		34,301
Property and equipment, net of impairment and accumulated depreciation of $0 and $1,434,947, respectively	—		284,300
Total non-current assets from discontinued operations	—		284,300
Total assets from discontinued operations	$	1,509	$	318,601
Accounts payable and accrued expenses	319,787		600,571
Total current liabilities from discontinued operations	319,787		600,571
Total liabilities from discontinued operations	$	319,787	$	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 2 - Accounting Policies Intangible Assets (Details) (USD $)	12 Months Ended
	Dec. 31, 2013	Dec. 31, 2012
Patents and Trademarks
Intangible Assets
Estimated Useful Life (in years)	12
Gross	$ 476,390	$ 480,750
Accumulated Amortization	(454,566)	(456,361)
Net	21,824	24,389
Patents and Trademarks Pending
Intangible Assets
Estimated Useful Life (in years)	0
Gross	143,968	110,702
Accumulated Amortization		0
Net	143,968	110,702
Trade Names
Intangible Assets
Estimated Useful Life (in years)	8
Gross	33,250	33,250
Accumulated Amortization	(14,525)	(12,250)
Net	18,725	21,000
Total Intangible Assets
Intangible Assets
Gross	653,608	624,702
Accumulated Amortization	(469,091)	(468,611)
Net	184,517	156,091
Amortization
Intangible Assets
Amortization of intangible assets	4,840	5,088
Estimated future amortization	$ 5,000

Note 2 - Accounting Policies (Details) (USD $)	12 Months Ended
Note 2 - Accounting Policies (Details) (USD $)	Dec. 31, 2013	Dec. 31, 2012	Dec. 19, 2013
Top Customers [Abstract]
Largest customer, % of net sales	16.00%	28.00%
Second largest customer, % of net sales	15.00%
Largest customer, % of total accounts receivable	16.00%	19.00%
Second largest customer, % of total accounts receivable	10.00%
Top three customer, % of net sales	39.00%	45.00%
Goodwill Impairment	$ 0	$ 1,479,727
Loss on impairment of patents and trademarks	0	33,192
Accumulated comprehensive income from unrealized currency translation	$ 42,502	$ 42,502
Stock options outstanding	256,500	285,000
Subordinated debt, warrants to purchase common stock			100,000

Note 3 - Inventories Inventories, net (Details) (USD $)	Dec. 31, 2013	Dec. 31, 2012
Raw materials	$ 947,765	$ 521,908
Work-in-process	266,431	248,159
Finished goods	1,121,095	1,645,037
Total	2,335,291	2,415,104
Silver inventory	$ 382,332	$ 541,804

Note 4 - Property, Plant and Equipment, Net (Details) (USD $)	12 Months Ended
	Dec. 31, 2013	Dec. 31, 2012
Property, Plant and Equipment
Machinery and equipment	$ 13,734,528	$ 12,298,011
Buildings and improvements	4,303,156	4,293,725
Vehicles	94,227	94,227
Furniture, fixtures, computers and software	1,317,189	1,246,807
Land	202,492	202,492
Construction in progress	177,473	103,269
Total property, plant and equipment	19,829,065	18,238,531
Less: accumulated depreciation	(12,249,509)	(11,080,019)
Property, plant and equipment, net	7,579,556	7,158,512
Depreciation expense	$ 1,439,165	$ 1,412,170
Minimum asset life (years)
Property, Plant and Equipment
Machinery and equipment		3
Vehicles		3
Furniture, fixtures, computers and software		3
Maximum asset life (years)
Property, Plant and Equipment
Machinery and equipment		15
Vehicles		5
Furniture, fixtures, computers and software		5
Asset life (years)
Property, Plant and Equipment
Building and improvement		20

Note 5 - Debt Debt (Details) (USD $)	3 Months Ended		12 Months Ended
Note 5 - Debt Debt (Details) (USD $)	Jun. 30, 2012	Mar. 31, 2012	Dec. 31, 2013	Dec. 31, 2012	Dec. 19, 2013	Mar. 31, 2013	Mar. 29, 2013
Master Lease Agreement
Equipment note, Micron Products		$ 523,269
Cash payout to the Company, Micron equipment note		262,960
Payment to vendors, Micron equipment note		260,309
Outstanding balance, Micron equipment note				450,758
Equipment note, WirelessDx	888,649
Cash payout to the Company, Wireless equipment note	672,272
Payment to vendors, Micron equipment note	216,378
Outstanding balance, WirelessDx equipment note				807,498
2013 Credit Facility
Demand line of credit, outstanding balance			0	800,000
Revolving line of credit							4,000,000
Revolving line of credit, outstanding balance			2,774,495	0
Revolving line of credit, interest rate							4.00%
Percent borrowable of eligible accounts receivable, revolving line of credit							80.00%
Percent borrowable of eligible raw material inventory, revolving line of credit							50.00%
Commercial term loan							1,500,000
Commercial term loan, interest rate							4.25%
Commercial term loan, outstanding balance			1,293,378
Equipment line of credit							1,000,000
Equipment line of credit, interest rate							3.50%
Equipment line of credit, outstanding balance			624,094
Subordinated Debt
Subordinated Debt					500,000
Subordinated borrowing, Interest rate years 1 and 2					10.00%
Subordinated Borrowing, Interest rate after year 2					12.00%
Fair value of notes payable, subordinated debt					416,950
Fair value of warrants, subordinated debt					83,050
Non-cash interest expense			819	0
Equipment Notes
Equipment notes						272,500
Debt Instrument, Interest Rate, Stated Percentage						4.66%
Equipment notes, outstanding balance			$ 222,091

Note 5 - Debt Future Minimum Debt Payments (Details) (USD $)	Dec. 31, 2013
Revolver
Future maturities of debt
2014	$ 0
2015	2,774,495
2016	0
2017	0
2018	0
Thereafter	0
Total	2,774,495
Term debt and equipment notes
Future maturities of debt
2014	335,760
2015	350,424
2016	365,899
2017	382,001
2018	81,385
Thereafter	0
Total	1,515,469
Equipment line of credit
Future maturities of debt
2014	85,387
2015	118,159
2016	123,280
2017	128,623
2018	134,197
Thereafter	34,448
Total	624,094
Subordinated promissory notes
Future maturities of debt
2014	0
2015	0
2016	500,000
2017	0
2018	0
Thereafter	0
Total	500,000
Total
Future maturities of debt
2014	421,147
2015	3,243,078
2016	989,179
2017	510,624
2018	215,582
Thereafter	34,448
Total	$ 5,414,058

Note 6 - Income Taxes Income Tax (benefit) Provision (Details) (USD $)	12 Months Ended
	Dec. 31, 2013	Dec. 31, 2012
Current:
Federal	$ 0	$ 0
State	0	(6,717)
Total current income taxes	0	(6,717)
Deferred:
Federal	1,437,269	(319,475)
State	830,700	(549,800)
Foreign	0	0
Total deferred income taxes	2,267,969	(869,275)
Income tax provision (benefit)	$ 2,267,969	$ (875,992)

Note 6 - Income Taxes Deferred Income Taxes (Details) (USD $)	Dec. 31, 2013	Dec. 31, 2012
Current deferred tax assets:
Inventories	$ 111,800	$ 89,900
Bad debt reserve	63,200	93,600
Accrued expenses	104,900	68,900
Total current deferred tax assets	279,900	252,400
Long-term deferred tax assets:
Net operating loss carryforwards	2,696,400	2,290,400
Deferred Tax Assets, Operating Loss Carryforwards, Foreign	291,100	287,500
Federal and state tax credit carryforward	431,900	298,300
Patents and intangibles	99,100	115,200
Stock compensation	89,800	81,300
Other long term	474,500	447,500
Total long-term deferred tax assets	4,082,800	3,520,200
Total deferred tax assets	4,362,700	3,772,600
Current deferred tax liabilities:
Prepaid expenses	(50,400)	(53,000)
Long-term deferred tax liability:
Property, plant and equipment	(934,100)	(980,800)
Total deferred tax liabilities	(984,500)	1,033,800
Deferred tax valuation allowance	(3,378,200)	(470,900)
Net deferred tax asset (liabilities)	0	2,267,900
Additional tax information
Valuation allowance against foreign portion of deferred tax assets of discontinued operations		470,900
Increase (decrease) in valuation allowance against foreign portion of deferred tax assets of discontinued operations		119,000
Operating loss carryforward, federal	7,420,000
Operating loss carryforwards, state	10,471,000
Operating loss carryforwards, foreign	1,039,000
Federal tax credit carryover	243,000
State tax credit carryover	$ 188,900

Note 6 - Income Taxes Federal Income Taxes (Details) (USD $)	12 Months Ended
	Dec. 31, 2013	Dec. 31, 2012
Income Taxes [Line Items]
Federal statutory income tax rate	34.00%
Tax (benefit) provision computed at statutory rate	$ (425,395)	$ (1,106,054)
Change in valuation allowance	2,907,300	0
State income taxes, net of federal benefit	(58,045)	(299,200)
Goodwill impairment	0	422,900
Permanent differences	12,660	20,500
Tax credits (federal and state)	(96,133)	0
Differences on prior returns (federal and state)	(64,867)	59,500
Other	(7,551)	26,362
Income tax provision (benefit)	$ 2,267,969	$ (875,992)

Note 7 - Employee Benefit Plans (Details) (USD $)	12 Months Ended
Note 7 - Employee Benefit Plans (Details) (USD $)	Dec. 31, 2013	Dec. 31, 2012
Employee Benefit Plans [Line Items]
Maximum annual contribution per employee, percent of eligible compensation	90.00%
Matching 401K contribution	$ 44,488	$ 43,149

Note 8 - Commitments and Contingencies (Details) (USD $)	3 Months Ended	12 Months Ended
	Sep. 30, 2013	Dec. 31, 2013
Legal Matters [Abstract]
Legal matters, approximate		$ 100,000
Severance Agreement [Abstract]
Severance agreement, Chief Financial Officer	92,061
Severance agreement, outstanding balance		$ 69,673

Note 9 - Shareholders Equity Fair Value of Option Grants (Details)	12 Months Ended
	Dec. 31, 2013
Fair value of option grants
Expected option term	6.5
Expected annual dividend yield	0.00%
Minimum percent
Fair value of option grants
Expected volatility factor	29.00%
Risk-free rate	0.36%
Maximum percent
Fair value of option grants
Expected volatility factor	31.00%
Risk-free rate	0.68%

Note 9 - Shareholders Equity Stock Option Transactions (Details) (USD $)	12 Months Ended
	Dec. 31, 2013	Dec. 31, 2012
Stock Options
Outstanding	256,500	285,000
Number of shares
Stock Options
Outstanding	256,500
Granted	67,500
Exercised	0
Forfeited/Expired	(96,000)
Exercisable, year end	120,000	138,900
Weighted Average Exercise Price
Stock Options
Outstanding	$ 5.6	$ 2.44
Granted	$ 3.43
Exercised	$ 0
Forfeited/expired	$ 4.20
Exercisable, year end	$ 6.34	$ 2.53
Weighted Average Remaining Contractual Term (Years)
Stock Options
Outstanding	5.3	4.8
Granted	9.8
Exercisable, year end	2.5	3.1
Aggregate Intrinsic Value
Stock Options
Outstanding	$ 0	$ 0
Granted	$ 8,850
Exercised	0
Forfeited/expired	$ 0
Exercisable, year end	$ 8,850	$ 0

Note 9 - Shareholders Equity (Details) (USD $)	12 Months Ended
Note 9 - Shareholders Equity (Details) (USD $)	Dec. 31, 2013 Y	Dec. 31, 2012	Dec. 19, 2013
Escrow Released from Contingent Consideration [Abstract]
Escrow released related to contingent consideration, shares		86,275
Escrow Released Related to Contingent Consideration, Treasury Stock, Value		$ 235,426
Dividends [Abstract]
One time cash dividend, per share		$ 0.03
One time cash dividend		84,119
Subordinated Debt [Abstract]
Subordinated debt, warrants to purchase common stock			100,000
Subordinated debt, exercise price of warranted shares			$ 3.51
Share-based Compensation [Abstract]
Shares issued to the Board of Directors	18,000
Non-cash compensation expense	62,460
Options authorized to issue, 2010 plan		500,000
Common stock, shares issued towards, 2010 Plan		400,000
Reserved shares from 2005 Plan		100,000
Shares outstanding, 2010 Plan	256,500
Shares available for future grants, 2010 Plan	336,500
Share-based compensation expense	105,071	112,811
Unrecognized compensation cost based on stock option Plans	$ 133,531
Period to recognize unrecognized compensation costs	1.5
Grant date fair value	$ 1.03

Note 10 - Industry and Geographic Segments Sales by Industry Segment (Details) (USD $)	12 Months Ended
	Dec. 31, 2013	Dec. 31, 2012
REVENUE by Industry
Sales by Industry Segment
Medical	$ 17,459,309	$ 17,453,573
Military and Law Enforcement	1,499,428	1,293,662
Industrial	1,382,913	525,069
Consumer Products	618,361	838,956
Other	381,041	531,310
Total	$ 21,341,052	$ 20,642,570
PERCENT of revenue by Industry
Sales by Industry Segment
Medical	82	84
Military and Law Enforcement	7	6
Industrial	6	3
Consumer Products	3	4
Other	2	3
Total Sales	100	100

Note 10 - Industry and Geographic Segments Sales by Geographic Market (Details) (USD $)	12 Months Ended
	Dec. 31, 2013	Dec. 31, 2012
REVENUE by Geographic Market
Geographic Market
United States	$ 11,642,242	$ 8,955,831
Canada	3,625,470	5,691,931
Europe	1,639,986	1,653,171
Pacific Rim	2,635,619	1,949,558
Other	1,797,735	2,392,079
Total	$ 21,341,052	$ 20,642,570
PRECENT of Revenue by Geographic Market
Geographic Market
United States	55	43
Canada	17	28
Europe	8	8
Pacific Rim	12	9
Other	8	12
Total Sales	100	100

Note 11 - Discontinued Operations (Details) (USD $)	12 Months Ended
Note 11 - Discontinued Operations (Details) (USD $)	Dec. 31, 2013	Dec. 31, 2012
Assets and liabilities of discontinued operations
Cash	$ 1,509	$ 30,882
Prepaid expenses and other assets	0	3,419
Total current assets from discontinued operations	1,509	34,301
Property and equipment, net of impairment and accumulated depreciation of $0 and $1,434,947, respectively	0	284,300
Total non-current assets from discontinued operations	0	284,300
Total assets from discontinued operations	1,509	318,601
Accounts payable and accrued expenses	319,787	600,571
Total current liabilities from discontinued operations	319,787	600,571
Total Liabilities from discontinued operations	319,787	600,571
Discontinued Operations - Supplemental Information
Revenues from discontinued operations	0	372,955
Net loss from discontinued operations	(19,194)	(3,760,827)
Tax benefit, discontinued operations	0	1,814,223
Contingent liability from unmet performance obligation	1,000,000
Restricted cash related to performance obligation	1,000,000
Letter of credit to secure performance obligation		$ 1,000,000

hrt-20131231