Annual report pursuant to Section 13 and 15(d)

Capitalized Technology

Capitalized Technology

12 Months Ended

Dec. 31, 2016

5. Capitalized Technology

Capitalized Technology, net is as follows:

	December 31,
	2016		2015
Capitalized cost:
Balance, beginning of period	$	1,888,791	$	1,469,432
Additional capitalized cost		-		419,359
Balance, end of period	$	1,888,791	$	1,888,791

Accumulated amortization:
Balance, beginning of period	$	1,432,268	$	943,362
Provision for amortization		283,155		488,906
Balance, end of period	$	1,715,423	$	1,432,268
Capitalized Technology, net	$	173,368	$	456,523

Amortization expense of $283,155 and $488,906 for the years ended December 31, 2016 and 2015, respectively, is recorded in depreciation and amortization expense in the accompanying statement of operations.

- Definition

The entire disclosure for research, development, and computer software activities, including contracts and arrangements to be performed for others and with federal government. Includes costs incurred (1) in a planned search or critical investigation aimed at discovery of new knowledge with the hope that such knowledge will be useful in developing a new product or service, a new process or technique, or in bringing about a significant improvement to an existing product or process; or (2) to translate research findings or other knowledge into a plan or design for a new product or process or for a significant improvement to an existing product or process whether intended for sale or the entity's use, during the reporting period charged to research and development projects, including the costs of developing computer software up to the point in time of achieving technological feasibility and in-process research and development acquired in a business combination consummated during the period.

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