financial operations revenue we expect that revenues we generate from the sales of our products will fluctuate from quarter to quarter . between 2008 and 2012 , we entered into joint development and collaboration agreements with animas and tandem , as well as other third parties under agreements that have since expired , under which we recognized development grant and other revenue received pursuant to that agreement ratably over the term of the development period . we recognize development milestones associated with each agreement as revenue upon achievement of each milestone if the milestone is considered substantive . cost of sales product cost of sales includes direct labor and materials costs related to each product sold or produced , including assembly , test labor and scrap , as well as factory overhead supporting our manufacturing operations . factory overhead includes facilities , material procurement and control , manufacturing engineering , quality assurance , supervision and management . these costs are primarily salary , fringe benefits , share-based compensation , facility expense , supplies and purchased services . a large portion of our costs are currently fixed due to our moderate level of production volumes compared to our potential capacity . all 47 of our manufacturing costs are included in product cost of sales . development and other cost of sales consists primarily of salaries , fringe , facilities , and supplies directly attributable to our development contracts . research and development our research and development expenses primarily consist of engineering and research expenses related to our continuous glucose monitoring technology , clinical trials , regulatory expenses , quality assurance programs , materials and products for clinical trials . research and development expenses are primarily related to employee compensation , including salary , fringe benefits , share-based compensation , and temporary employee expenses . we also incur significant expenses to operate our clinical trials including clinical site reimbursement , clinical trial product and associated travel expenses . our research and development expenses also include fees for design services , contractors and development materials . selling , general and administrative our selling , general and administrative expenses primarily consist of salary , fringe benefits and share-based compensation for our executive , financial , sales , marketing and administrative functions . other significant expenses include trade show expenses , sales samples , insurance , professional fees for our outside legal counsel and independent auditors , litigation expenses , patent application expenses and consulting expenses . results of operations fiscal year ended december 31 , 2013 compared to december 31 , 2012 revenue , cost of sales and gross profit product revenue increased $ 64.1 million to $ 157.1 million for the twelve months ended december 31 , 2013 , compared to $ 93.0 million for the twelve months ended december 31 , 2012 based primarily on increased sales volume , due , in part , to the commercial launch in october 2012 of the g4 platinum system . product cost of sales increased $ 9.8 million to $ 58.1 million for the twelve months ended december 31 , 2013 , compared to $ 48.3 million for the twelve months ended december 31 , 2012 primarily due to increased sales volume . the product gross profit of $ 99.0 million for the twelve months ended december 31 , 2013 increased $ 54.3 million compared to $ 44.7 million for the same period in 2012 , primarily due to increased revenue , and the greater sales mix of our higher margin g4 platinum system compared to our seven plus system . development grant and other revenues decreased $ 4.0 million to $ 2.9 million for the twelve months ended december 31 , 2013 , compared to $ 6.9 million for the twelve months ended december 31 , 2012 . development and other cost of sales decreased $ 3.2 million to $ 1.8 million for the twelve months ended december 31 , 2013 , compared to $ 5.0 million for the twelve months ended december 31 , 2012 . the decrease in revenues associated with development was primarily due to the termination of the roche agreement in february 2013 , and the completion of development activities under the collaboration agreement with edwards in the fourth quarter of 2012. the decrease in costs associated with development was primarily due to fewer development obligations during the period with respect to our collaboration and development arrangements . research and development . research and development expense increased $ 6.5 million to $ 44.8 million for the twelve months ended december 31 , 2013 , compared to $ 38.3 million for the twelve months ended december 31 , 2012 . the increase in research and development expense was primarily due to increased development efforts for our ambulatory products . significant elements of increased research and development expense included $ 3.0 million in additional salaries , bonus , and payroll related costs and $ 2.5 million in additional share-based compensation . selling , general and administrative . selling , general and administrative expense increased $ 20.2 million to $ 84.2 million for the twelve months ended december 31 , 2013 , compared to $ 64.0 million for the twelve months ended december 31 , 2012 . the increase was primarily due to higher selling and information technology costs to support revenue growth and the continued commercialization of our products . significant elements of increased selling , general , and administrative expenses included $ 7.3 million in additional salaries , bonus , and payroll related costs , $ 3.4 million in additional share-based compensation costs , $ 3.2 million in additional sales commissions , and $ 1.5 million in additional bad debt expense . interest expense . interest expense increased to $ 0.9 million for the twelve months ended december 31 , 2013 , compared to $ 0.2 million for the twelve months ended december 31 , 2012 . story_separator_special_tag revenue on product sales to distributors is generally recognized at the time of shipment , which is when title and risk of loss have been transferred to the distributor and there are no other post-shipment obligations . revenue is recognized based on contracted prices and invoices are either paid by check following the issuance of a 52 purchase order or letter of credit , or they are paid by wire at the time of placing the order . terms of distributor orders are generally freight on board ( “ fob ” ) shipping point ( free carrier ( “ fca ” ) shipping point for international orders ) . distributors do not have rights of return per their distribution agreement outside of our standard warranty . the distributors typically have a limited time frame to notify us of any missing , damaged , defective or non-conforming products . for any such products , we shall either , at our option , replace the portion of defective or non-conforming product at no additional cost to the distributor or cancel the order and refund any portion of the price paid to us at that time for the sale in question . we shipped product directly to certain distributors ' customers and recognized $ 23.4 million , $ 15.9 million and $ 14.5 million in revenue from these direct shipments , which represents 15 % , 16 % and 19 % of our total revenues for the twelve months ended december 31 , 2013 , 2012 and 2011 , respectively . with respect to other distributors that stock inventory of our product and fulfill orders from their inventory , we shipped product to these distributors and recognized $ 70.5 million , $ 30.7 million and $ 17.7 million in revenue from these arrangements , which represents 44 % , 31 % and 23 % of our total revenues for the twelve months ended december 31 , 2013 , 2012 and 2011 , respectively . we monitor shipments to , and on-hand inventory levels of , these distributors , and at december 31 , 2013 , these distributors had limited amounts of our product in their inventory . we have collaborative license and development arrangements with strategic partners for the development and commercialization of products utilizing our technologies . the terms of these agreements typically include multiple deliverables by us ( for example , license rights , provision of research and development services and manufacture of clinical materials ) in exchange for consideration to us of some combination of non-refundable license fees , funding of research and development activities , payments based upon achievement of clinical development milestones and royalties in the form of a designated percentage of product sales or profits . with the exception of royalties , these types of consideration are classified as development grant and other revenue in our consolidated statements of operations and are generally recognized over the service period except for substantive milestone payments , which are generally recognized when the milestone is achieved . in determining whether each milestone is substantive , we considered whether the consideration earned by achieving the milestone should ( i ) be commensurate with either ( a ) our performance to achieve the milestone or ( b ) the enhancement of value of the item delivered as a result of a specific outcome resulting from our performance to achieve the milestone , ( ii ) relate solely to past performance and ( iii ) be reasonable relative to all deliverables and payment terms in the arrangement . we recognize royalties as product revenue in the period in which we obtain the royalty report , which is necessary to determine the amount of royalties we are entitled to receive . non-refundable license fees are recognized as revenue when we have a contractual right to receive such payment , the contract price is fixed or determinable , the collection of the resulting receivable is reasonably assured and we have no further performance obligations under the license agreement . multiple element arrangements , such as license , development and other multiple element service arrangements , are analyzed to determine how the arrangement consideration should be allocated among the separate units of accounting , or whether they must be accounted for as a single unit of accounting . for transactions containing multiple element arrangements , we consider deliverables as separate units of accounting and recognize deliverables as revenue upon delivery only if ( i ) the deliverable has standalone value and ( ii ) if the arrangement includes a general right of return relative to the delivered item ( s ) , delivery or performance of the undelivered item ( s ) is probable and substantially controlled by us . we allocate consideration to the separate units of accounting using the relative selling price method , in which allocation of consideration is based on vendor-specific objective evidence ( “ vsoe ” ) if available , third-party evidence ( “ tpe ” ) , or if vsoe and tpe are not available , management 's best estimate of a standalone selling price for elements . we use judgment in estimating the value allocable to the deliverables in an agreement based on our estimate of the fair value or relative selling price attributable to the related deliverables and the consideration from such an agreement is typically recognized as product revenue or development grant and other revenue . for arrangements that are accounted for as a single unit of accounting , total payments under the arrangement are recognized as revenue on a straight-line basis over the period we expect to complete our performance obligations . we review the estimated period of our performance obligations on a periodic basis and update the recognition period as appropriate . the cumulative amount of revenue earned is limited to the cumulative amount of payments we are entitled to as of the period ending date . if we can not reasonably estimate when our

liquidity and capital resources we are in the early commercialization stage and have incurred losses since our inception in may 1999. as of december 31 , 2013 , we had an accumulated deficit of $ 475.4 million and had working capital of $ 61.0 million . our cash , cash equivalents and short-term marketable securities totaled $ 54.6 million , excluding $ 1.0 million in restricted cash . to date , we have funded our operations primarily through offerings of equity securities and debt . in july 2013 , we were awarded a $ 4.0 million grant ( the `` helmsley grant '' ) from the leona m. and harry b. helmsley charitable trust ( the `` helmsley trust '' ) to accelerate the development of the sixth generation of our advanced glucose-sensing technologies ( the `` gen 6 sensor '' ) . the funding is milestone based and is contingent upon our meeting specific development milestones related to the gen 6 sensor over the next several years . upon the successful commercialization of the gen 6 sensor , we are obligated to either ( 1 ) make royalty payments of up to $ 2.0 million per year for four years , or ( 2 ) at our sole election , make a one-time $ 6.0 million royalty payment . net cash provided by/used in operating activities .


 Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.
     ```liquidity and capital resources we are in the early commercialization stage and have incurred losses since our inception in may 1999. as of december 31 , 2013 , we had an accumulated deficit of $ 475.4 million and had working capital of $ 61.0 million . our cash , cash equivalents and short-term marketable securities totaled $ 54.6 million , excluding $ 1.0 million in restricted cash . to date , we have funded our operations primarily through offerings of equity securities and debt . in july 2013 , we were awarded a $ 4.0 million grant ( the `` helmsley grant '' ) from the leona m. and harry b. helmsley charitable trust ( the `` helmsley trust '' ) to accelerate the development of the sixth generation of our advanced glucose-sensing technologies ( the `` gen 6 sensor '' ) . the funding is milestone based and is contingent upon our meeting specific development milestones related to the gen 6 sensor over the next several years . upon the successful commercialization of the gen 6 sensor , we are obligated to either ( 1 ) make royalty payments of up to $ 2.0 million per year for four years , or ( 2 ) at our sole election , make a one-time $ 6.0 million royalty payment . net cash provided by/used in operating activities .
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 Suspicious Activity Report : financial operations revenue we expect that revenues we generate from the sales of our products will fluctuate from quarter to quarter . between 2008 and 2012 , we entered into joint development and collaboration agreements with animas and tandem , as well as other third parties under agreements that have since expired , under which we recognized development grant and other revenue received pursuant to that agreement ratably over the term of the development period . we recognize development milestones associated with each agreement as revenue upon achievement of each milestone if the milestone is considered substantive . cost of sales product cost of sales includes direct labor and materials costs related to each product sold or produced , including assembly , test labor and scrap , as well as factory overhead supporting our manufacturing operations . factory overhead includes facilities , material procurement and control , manufacturing engineering , quality assurance , supervision and management . these costs are primarily salary , fringe benefits , share-based compensation , facility expense , supplies and purchased services . a large portion of our costs are currently fixed due to our moderate level of production volumes compared to our potential capacity . all 47 of our manufacturing costs are included in product cost of sales . development and other cost of sales consists primarily of salaries , fringe , facilities , and supplies directly attributable to our development contracts . research and development our research and development expenses primarily consist of engineering and research expenses related to our continuous glucose monitoring technology , clinical trials , regulatory expenses , quality assurance programs , materials and products for clinical trials . research and development expenses are primarily related to employee compensation , including salary , fringe benefits , share-based compensation , and temporary employee expenses . we also incur significant expenses to operate our clinical trials including clinical site reimbursement , clinical trial product and associated travel expenses . our research and development expenses also include fees for design services , contractors and development materials . selling , general and administrative our selling , general and administrative expenses primarily consist of salary , fringe benefits and share-based compensation for our executive , financial , sales , marketing and administrative functions . other significant expenses include trade show expenses , sales samples , insurance , professional fees for our outside legal counsel and independent auditors , litigation expenses , patent application expenses and consulting expenses . results of operations fiscal year ended december 31 , 2013 compared to december 31 , 2012 revenue , cost of sales and gross profit product revenue increased $ 64.1 million to $ 157.1 million for the twelve months ended december 31 , 2013 , compared to $ 93.0 million for the twelve months ended december 31 , 2012 based primarily on increased sales volume , due , in part , to the commercial launch in october 2012 of the g4 platinum system . product cost of sales increased $ 9.8 million to $ 58.1 million for the twelve months ended december 31 , 2013 , compared to $ 48.3 million for the twelve months ended december 31 , 2012 primarily due to increased sales volume . the product gross profit of $ 99.0 million for the twelve months ended december 31 , 2013 increased $ 54.3 million compared to $ 44.7 million for the same period in 2012 , primarily due to increased revenue , and the greater sales mix of our higher margin g4 platinum system compared to our seven plus system . development grant and other revenues decreased $ 4.0 million to $ 2.9 million for the twelve months ended december 31 , 2013 , compared to $ 6.9 million for the twelve months ended december 31 , 2012 . development and other cost of sales decreased $ 3.2 million to $ 1.8 million for the twelve months ended december 31 , 2013 , compared to $ 5.0 million for the twelve months ended december 31 , 2012 . the decrease in revenues associated with development was primarily due to the termination of the roche agreement in february 2013 , and the completion of development activities under the collaboration agreement with edwards in the fourth quarter of 2012. the decrease in costs associated with development was primarily due to fewer development obligations during the period with respect to our collaboration and development arrangements . research and development . research and development expense increased $ 6.5 million to $ 44.8 million for the twelve months ended december 31 , 2013 , compared to $ 38.3 million for the twelve months ended december 31 , 2012 . the increase in research and development expense was primarily due to increased development efforts for our ambulatory products . significant elements of increased research and development expense included $ 3.0 million in additional salaries , bonus , and payroll related costs and $ 2.5 million in additional share-based compensation . selling , general and administrative . selling , general and administrative expense increased $ 20.2 million to $ 84.2 million for the twelve months ended december 31 , 2013 , compared to $ 64.0 million for the twelve months ended december 31 , 2012 . the increase was primarily due to higher selling and information technology costs to support revenue growth and the continued commercialization of our products . significant elements of increased selling , general , and administrative expenses included $ 7.3 million in additional salaries , bonus , and payroll related costs , $ 3.4 million in additional share-based compensation costs , $ 3.2 million in additional sales commissions , and $ 1.5 million in additional bad debt expense . interest expense . interest expense increased to $ 0.9 million for the twelve months ended december 31 , 2013 , compared to $ 0.2 million for the twelve months ended december 31 , 2012 . story_separator_special_tag revenue on product sales to distributors is generally recognized at the time of shipment , which is when title and risk of loss have been transferred to the distributor and there are no other post-shipment obligations . revenue is recognized based on contracted prices and invoices are either paid by check following the issuance of a 52 purchase order or letter of credit , or they are paid by wire at the time of placing the order . terms of distributor orders are generally freight on board ( “ fob ” ) shipping point ( free carrier ( “ fca ” ) shipping point for international orders ) . distributors do not have rights of return per their distribution agreement outside of our standard warranty . the distributors typically have a limited time frame to notify us of any missing , damaged , defective or non-conforming products . for any such products , we shall either , at our option , replace the portion of defective or non-conforming product at no additional cost to the distributor or cancel the order and refund any portion of the price paid to us at that time for the sale in question . we shipped product directly to certain distributors ' customers and recognized $ 23.4 million , $ 15.9 million and $ 14.5 million in revenue from these direct shipments , which represents 15 % , 16 % and 19 % of our total revenues for the twelve months ended december 31 , 2013 , 2012 and 2011 , respectively . with respect to other distributors that stock inventory of our product and fulfill orders from their inventory , we shipped product to these distributors and recognized $ 70.5 million , $ 30.7 million and $ 17.7 million in revenue from these arrangements , which represents 44 % , 31 % and 23 % of our total revenues for the twelve months ended december 31 , 2013 , 2012 and 2011 , respectively . we monitor shipments to , and on-hand inventory levels of , these distributors , and at december 31 , 2013 , these distributors had limited amounts of our product in their inventory . we have collaborative license and development arrangements with strategic partners for the development and commercialization of products utilizing our technologies . the terms of these agreements typically include multiple deliverables by us ( for example , license rights , provision of research and development services and manufacture of clinical materials ) in exchange for consideration to us of some combination of non-refundable license fees , funding of research and development activities , payments based upon achievement of clinical development milestones and royalties in the form of a designated percentage of product sales or profits . with the exception of royalties , these types of consideration are classified as development grant and other revenue in our consolidated statements of operations and are generally recognized over the service period except for substantive milestone payments , which are generally recognized when the milestone is achieved . in determining whether each milestone is substantive , we considered whether the consideration earned by achieving the milestone should ( i ) be commensurate with either ( a ) our performance to achieve the milestone or ( b ) the enhancement of value of the item delivered as a result of a specific outcome resulting from our performance to achieve the milestone , ( ii ) relate solely to past performance and ( iii ) be reasonable relative to all deliverables and payment terms in the arrangement . we recognize royalties as product revenue in the period in which we obtain the royalty report , which is necessary to determine the amount of royalties we are entitled to receive . non-refundable license fees are recognized as revenue when we have a contractual right to receive such payment , the contract price is fixed or determinable , the collection of the resulting receivable is reasonably assured and we have no further performance obligations under the license agreement . multiple element arrangements , such as license , development and other multiple element service arrangements , are analyzed to determine how the arrangement consideration should be allocated among the separate units of accounting , or whether they must be accounted for as a single unit of accounting . for transactions containing multiple element arrangements , we consider deliverables as separate units of accounting and recognize deliverables as revenue upon delivery only if ( i ) the deliverable has standalone value and ( ii ) if the arrangement includes a general right of return relative to the delivered item ( s ) , delivery or performance of the undelivered item ( s ) is probable and substantially controlled by us . we allocate consideration to the separate units of accounting using the relative selling price method , in which allocation of consideration is based on vendor-specific objective evidence ( “ vsoe ” ) if available , third-party evidence ( “ tpe ” ) , or if vsoe and tpe are not available , management 's best estimate of a standalone selling price for elements . we use judgment in estimating the value allocable to the deliverables in an agreement based on our estimate of the fair value or relative selling price attributable to the related deliverables and the consideration from such an agreement is typically recognized as product revenue or development grant and other revenue . for arrangements that are accounted for as a single unit of accounting , total payments under the arrangement are recognized as revenue on a straight-line basis over the period we expect to complete our performance obligations . we review the estimated period of our performance obligations on a periodic basis and update the recognition period as appropriate . the cumulative amount of revenue earned is limited to the cumulative amount of payments we are entitled to as of the period ending date . if we can not reasonably estimate when our

