this discussion and analysis contains , in addition to historical information , forward-looking statements that involve risks and uncertainties . our actual results may differ materially from those anticipated in these forward-looking statements as a result of certain risks and uncertainties , including those set forth under the heading risk factors and elsewhere in this report . overview the company is organized into two reportable operating segments . the lifeboat distribution segment distributes technical software to corporate resellers , value added resellers ( vars ) , consultants and systems integrators worldwide . the techxtend segment is a value-added reseller of software , hardware and services for corporations , government organizations and academic institutions in the usa and canada . we offer an extensive line of products from leading publishers of software and tools for virtualization/cloud computing , security , networking , storage & infrastructure management , application lifecycle management and other technically sophisticated domains as well as computer hardware . we market these products through direct sales , the internet , our catalogs , direct mail programs , advertisements in trade magazines and e-mail promotions . forward-looking statements this report includes forward-looking statements within the meaning of section 21e of the exchange act . statements in this report regarding future events or conditions , including but not limited to statements regarding industry prospects and the company 's expected financial position , business and financing plans , are forward-looking statements . although the company believes that the expectations reflected in such forward-looking statements are reasonable , it can give no assurance that such expectations will prove to have been correct . we strongly urge current and prospective investors to carefully consider the cautionary statements and risks contained in this report , particularly the risks described under item 1a . risk factors above . such risks include , but are not limited to , the continued acceptance of the company 's distribution channel by vendors and customers , the timely availability and acceptance of new products , contribution of key vendor relationships and support programs , as well as factors that affect the software industry generally . the company operates in a rapidly changing business , and new risk factors emerge from time to time . management can not predict every risk factor , nor can it assess the impact , if any , of all such risk factors on the company 's business or the extent to which any factor , or combination of factors , may cause actual results to differ materially from those projected in any forward-looking statements . accordingly , forward-looking statements should not be relied upon as a prediction of actual results and readers are cautioned not to place undue reliance on these forward-looking statements , which speak only as of their dates . the company undertakes no obligation to publicly update or revise any forward-looking statements , whether as a result of new information , future events or otherwise . the statements concerning future sales , future gross profit margin and future selling and administrative expenses are forward looking statements involving certain risks and uncertainties such as availability of products , product mix , pricing pressures , market conditions and other factors , which could result in a fluctuation of sales below recent experience . page 14 stock volatility . the technology sector of the united states stock markets has experienced substantial volatility in recent periods . numerous conditions which impact the technology sector or the stock market in general or the company in particular , whether or not such events relate to or reflect upon the company 's operating performance , could adversely affect the market price of the company 's common stock . furthermore , fluctuations in the company 's operating results , announcements regarding litigation , the loss of a significant vendor or customer , increased competition , reduced vendor incentives and trade credit , higher postage and operating expenses , and other developments , could have a significant impact on the market price of the company 's common stock . financial overview net sales totaled $ 300.4 million in 2013 as compared to $ 297.1 million in 2012 , representing a 1 % increase . gross profit increased by $ 0.5 million or 2 % in 2013 as compared to 2012. selling , general and administrative ( sg & a ) expenses increased by $ 0.1 million in 2013 as compared to 2012. income from operations amounted to $ 8.9 million in 2013 as compared to $ 8.5 million in 2012 , representing an increase of $ 0.4 million or 4 % as compared to 2012. this increase resulted from the increase in total sales and total gross margin ( lifeboat distribution segment increased offset by a decrease in techxtend segment ) offset by a slight increase in sg & a expenses . our income before provision for income taxes increased by $ 0.3 million to $ 9.4 million in 2013 compared to $ 9.1 million in 2012. we reported a net income of $ 6.4 million for 2013 compared to $ 5.5 million in 2012. the company 's sales , gross profit and results of operations have fluctuated and are expected to continue to fluctuate on a quarterly basis as a result of a number of factors , including but not limited to : the condition of the software industry in general , shifts in demand for software products , pricing , level of extended payment terms sales transactions , industry shipments of new software products or upgrades , the timing of new merchandise and catalog offerings , fluctuations in response rates , fluctuations in merchandise returns , adverse weather conditionsthat affect response , distribution or shipping , shifts in the timing of holidays and changes in the company 's product offerings . story_separator_special_tag as a result of the increase in net sales , sg & a expenses declined as a percentage of net sales to 5.2 % in 2012 , compared to 5.9 % in 2011. direct selling costs ( a component of sg & a ) for 2012 were $ 8.1 million compared to $ 7.8 million in 2011. total direct selling costs for our lifeboat distribution segment for 2012 were $ 4.5 million compared to $ 4.7 million in 2011 , mainly due to lower commission and bonus expense compared to the prior year . total direct selling costs for our techxtend segment for 2012 were $ 3.6 million compared to $ 3.1 million in 2011. the increase in the techxtend segment was due to higher commission , salaries and bonus expense resulting from growth in the segment . the company expects that its sg & a expenses , as a percentage of net sales , may vary depending on changes in sales volume , as well as the levels of continuing investments in key growth initiatives . income taxes for the year ended december 31 , 2012 , the company recorded a provision for income taxes of $ 3.6 million which consists of a provision of $ 2.8 million for u.s. federal income taxes , as well as a $ 0.5 million provision for state and local taxes , a $ 0.2 million provision for foreign taxes , and a deferred tax expense of $ 0.1 million . as of december 31 , 2012 , the company had a u.s. deferred tax asset of approximately $ 0.5 million . for the year ended december 31 , 2011 , the company recorded a provision for income taxes of $ 3.4 million which consists of a provision of $ 2.4 million for u.s. federal income taxes , as well as a $ 0.5 million provision for state and local taxes , a $ 0.3 million provision for foreign taxes , and a deferred tax expense of $ 0.3 million . as of december 31 , 2011 , the company had a u.s. deferred tax asset of approximately $ 0.6 million . page 18 recently adopted accounting pronouncements in february 2013 , the financial accounting standards board ( fasb ) issued accounting standards update ( asu ) 2013-02 reporting of amounts reclassified out of accumulated other comprehensive income . this update requires companies to present the effects on the line items of net income of significant reclassifications out of accumulated other comprehensive income if the amount being reclassified is required under u.s. generally accepted accounting principles ( us gaap ) to be reclassified in its entirety to net income in the same reporting period . asu 2013-02 is effective prospectively for the company for fiscal years , and interim periods within those years , beginning after december 15 , 2012. the adoption of the amended guidance did not have a significant impact on our consolidated financial statements . story_separator_special_tag ( see note 7 credit facility in the notes to our consolidated financial statements ) . foreign exchange the company 's canadian business is subject to changes in demand or pricing resulting from fluctuations in currency exchange rates or other factors . we are subject to fluctuations primarily in the canadian dollar-to-u.s. dollar exchange rate . page 20 off-balance sheet arrangements as of december 31 , 2013 , we did not have any off-balance sheet arrangements , as defined in item 303 ( a ) ( 4 ) ( ii ) of sec regulation s-k. critical accounting policies and estimates management 's discussion and analysis of the company 's financial condition and results of operations are based upon the company 's consolidated financial statements that have been prepared in accordance with us gaap . the preparation of these financial statements requires the company to make estimates and judgments that affect the reported amounts of assets , liabilities , revenues and expenses , and related disclosure of contingent assets and liabilities . the company recognizes revenue from the sale of software and hardware for microcomputers , servers and networks on a gross revenue recognition basis upon shipment or upon electronic delivery of the product . on an on-going basis , the company evaluates its estimates , including those related to product returns , bad debts , inventories , investments , intangible assets , income taxes , stock-based compensation , contingencies and litigation . the company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances , the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources . actual results may differ from these estimates . the company believes the following critical accounting policies used in the preparation of its consolidated financial statements affect its more significant judgments and estimates . the company maintains allowances for doubtful accounts for estimated losses resulting from the inability of its customers to make required payments . if the financial condition of the company 's customers were to deteriorate , resulting in an impairment of their ability to make payments , additional allowances may be required . the company writes down its inventory for estimated obsolescence or unmarketable inventory equal to the difference between the cost of inventory and the estimated market value based upon assumptions about future demand and market conditions . if actual market conditions are less favorable than those projected by management , additional inventory write-offs may be required . the company has considered future taxable income and ongoing prudent and feasible tax planning strategies in assessing the need for the valuation allowance related to deferred tax assets . in the event the company were to determine that it would not be able to realize all or part of its net deferred tax assets in the future , an adjustment to the deferred tax assets would be charged to income in

liquidity and capital resources our cash and cash equivalents increased by $ 9.8 million to $ 19.6 million at december 31 , 2013 from $ 9.8 million at december 31 , 2012. net cash provided by operating activities amounted to $ 10.3 million , net cash provided by investing activities amounted to $ 4.2 million , and net cash used in financing activities amounted to $ 4.8 million . net cash provided by operating activities in 2013 was $ 10.3 million . in 2013 , cash was mainly provided by $ 8.1 million from net income net of non-cash charges , a $ 2.0 million decrease in accounts receivable , a $ 0.4 million decrease in inventory , and a $ 0.8 million increase in accounts payable , offset in part by an increase in prepaid and other current assets of $ 0.8 million . in 2013 , cash provided by investing activities was $ 4.2 million . this resulted primarily from $ 4.4 million net redemptions of available-for-sale marketable securities . these securities are highly rated and highly liquid . these securities are classified as available-for-sale securities in accordance with asc topic 320 investments in debt and equity securities , and as a result , unrealized gains and losses are reported as part of accumulated other comprehensive income . this was partially offset by $ 0.2 million for the purchase of equipment and leasehold improvements . net cash used in financing activities in 2013 of $ 4.8 million consisted of $ 3.0 million of dividend payments on our common stock and $ 2.1 million for the purchases of treasury shares of our common stock offset by the tax benefit from share based compensation of $ 0.2 million and the exercise of stock options of $ 0.2 million . in 2008 , the board of directors authorized the purchase of 500,000 shares of our common stock .


 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 our cash and cash equivalents increased by $ 9.8 million to $ 19.6 million at december 31 , 2013 from $ 9.8 million at december 31 , 2012. net cash provided by operating activities amounted to $ 10.3 million , net cash provided by investing activities amounted to $ 4.2 million , and net cash used in financing activities amounted to $ 4.8 million . net cash provided by operating activities in 2013 was $ 10.3 million . in 2013 , cash was mainly provided by $ 8.1 million from net income net of non-cash charges , a $ 2.0 million decrease in accounts receivable , a $ 0.4 million decrease in inventory , and a $ 0.8 million increase in accounts payable , offset in part by an increase in prepaid and other current assets of $ 0.8 million . in 2013 , cash provided by investing activities was $ 4.2 million . this resulted primarily from $ 4.4 million net redemptions of available-for-sale marketable securities . these securities are highly rated and highly liquid . these securities are classified as available-for-sale securities in accordance with asc topic 320 investments in debt and equity securities , and as a result , unrealized gains and losses are reported as part of accumulated other comprehensive income . this was partially offset by $ 0.2 million for the purchase of equipment and leasehold improvements . net cash used in financing activities in 2013 of $ 4.8 million consisted of $ 3.0 million of dividend payments on our common stock and $ 2.1 million for the purchases of treasury shares of our common stock offset by the tax benefit from share based compensation of $ 0.2 million and the exercise of stock options of $ 0.2 million . in 2008 , the board of directors authorized the purchase of 500,000 shares of our common stock .
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 Suspicious Activity Report : this discussion and analysis contains , in addition to historical information , forward-looking statements that involve risks and uncertainties . our actual results may differ materially from those anticipated in these forward-looking statements as a result of certain risks and uncertainties , including those set forth under the heading risk factors and elsewhere in this report . overview the company is organized into two reportable operating segments . the lifeboat distribution segment distributes technical software to corporate resellers , value added resellers ( vars ) , consultants and systems integrators worldwide . the techxtend segment is a value-added reseller of software , hardware and services for corporations , government organizations and academic institutions in the usa and canada . we offer an extensive line of products from leading publishers of software and tools for virtualization/cloud computing , security , networking , storage & infrastructure management , application lifecycle management and other technically sophisticated domains as well as computer hardware . we market these products through direct sales , the internet , our catalogs , direct mail programs , advertisements in trade magazines and e-mail promotions . forward-looking statements this report includes forward-looking statements within the meaning of section 21e of the exchange act . statements in this report regarding future events or conditions , including but not limited to statements regarding industry prospects and the company 's expected financial position , business and financing plans , are forward-looking statements . although the company believes that the expectations reflected in such forward-looking statements are reasonable , it can give no assurance that such expectations will prove to have been correct . we strongly urge current and prospective investors to carefully consider the cautionary statements and risks contained in this report , particularly the risks described under item 1a . risk factors above . such risks include , but are not limited to , the continued acceptance of the company 's distribution channel by vendors and customers , the timely availability and acceptance of new products , contribution of key vendor relationships and support programs , as well as factors that affect the software industry generally . the company operates in a rapidly changing business , and new risk factors emerge from time to time . management can not predict every risk factor , nor can it assess the impact , if any , of all such risk factors on the company 's business or the extent to which any factor , or combination of factors , may cause actual results to differ materially from those projected in any forward-looking statements . accordingly , forward-looking statements should not be relied upon as a prediction of actual results and readers are cautioned not to place undue reliance on these forward-looking statements , which speak only as of their dates . the company undertakes no obligation to publicly update or revise any forward-looking statements , whether as a result of new information , future events or otherwise . the statements concerning future sales , future gross profit margin and future selling and administrative expenses are forward looking statements involving certain risks and uncertainties such as availability of products , product mix , pricing pressures , market conditions and other factors , which could result in a fluctuation of sales below recent experience . page 14 stock volatility . the technology sector of the united states stock markets has experienced substantial volatility in recent periods . numerous conditions which impact the technology sector or the stock market in general or the company in particular , whether or not such events relate to or reflect upon the company 's operating performance , could adversely affect the market price of the company 's common stock . furthermore , fluctuations in the company 's operating results , announcements regarding litigation , the loss of a significant vendor or customer , increased competition , reduced vendor incentives and trade credit , higher postage and operating expenses , and other developments , could have a significant impact on the market price of the company 's common stock . financial overview net sales totaled $ 300.4 million in 2013 as compared to $ 297.1 million in 2012 , representing a 1 % increase . gross profit increased by $ 0.5 million or 2 % in 2013 as compared to 2012. selling , general and administrative ( sg & a ) expenses increased by $ 0.1 million in 2013 as compared to 2012. income from operations amounted to $ 8.9 million in 2013 as compared to $ 8.5 million in 2012 , representing an increase of $ 0.4 million or 4 % as compared to 2012. this increase resulted from the increase in total sales and total gross margin ( lifeboat distribution segment increased offset by a decrease in techxtend segment ) offset by a slight increase in sg & a expenses . our income before provision for income taxes increased by $ 0.3 million to $ 9.4 million in 2013 compared to $ 9.1 million in 2012. we reported a net income of $ 6.4 million for 2013 compared to $ 5.5 million in 2012. the company 's sales , gross profit and results of operations have fluctuated and are expected to continue to fluctuate on a quarterly basis as a result of a number of factors , including but not limited to : the condition of the software industry in general , shifts in demand for software products , pricing , level of extended payment terms sales transactions , industry shipments of new software products or upgrades , the timing of new merchandise and catalog offerings , fluctuations in response rates , fluctuations in merchandise returns , adverse weather conditionsthat affect response , distribution or shipping , shifts in the timing of holidays and changes in the company 's product offerings . story_separator_special_tag as a result of the increase in net sales , sg & a expenses declined as a percentage of net sales to 5.2 % in 2012 , compared to 5.9 % in 2011. direct selling costs ( a component of sg & a ) for 2012 were $ 8.1 million compared to $ 7.8 million in 2011. total direct selling costs for our lifeboat distribution segment for 2012 were $ 4.5 million compared to $ 4.7 million in 2011 , mainly due to lower commission and bonus expense compared to the prior year . total direct selling costs for our techxtend segment for 2012 were $ 3.6 million compared to $ 3.1 million in 2011. the increase in the techxtend segment was due to higher commission , salaries and bonus expense resulting from growth in the segment . the company expects that its sg & a expenses , as a percentage of net sales , may vary depending on changes in sales volume , as well as the levels of continuing investments in key growth initiatives . income taxes for the year ended december 31 , 2012 , the company recorded a provision for income taxes of $ 3.6 million which consists of a provision of $ 2.8 million for u.s. federal income taxes , as well as a $ 0.5 million provision for state and local taxes , a $ 0.2 million provision for foreign taxes , and a deferred tax expense of $ 0.1 million . as of december 31 , 2012 , the company had a u.s. deferred tax asset of approximately $ 0.5 million . for the year ended december 31 , 2011 , the company recorded a provision for income taxes of $ 3.4 million which consists of a provision of $ 2.4 million for u.s. federal income taxes , as well as a $ 0.5 million provision for state and local taxes , a $ 0.3 million provision for foreign taxes , and a deferred tax expense of $ 0.3 million . as of december 31 , 2011 , the company had a u.s. deferred tax asset of approximately $ 0.6 million . page 18 recently adopted accounting pronouncements in february 2013 , the financial accounting standards board ( fasb ) issued accounting standards update ( asu ) 2013-02 reporting of amounts reclassified out of accumulated other comprehensive income . this update requires companies to present the effects on the line items of net income of significant reclassifications out of accumulated other comprehensive income if the amount being reclassified is required under u.s. generally accepted accounting principles ( us gaap ) to be reclassified in its entirety to net income in the same reporting period . asu 2013-02 is effective prospectively for the company for fiscal years , and interim periods within those years , beginning after december 15 , 2012. the adoption of the amended guidance did not have a significant impact on our consolidated financial statements . story_separator_special_tag ( see note 7 credit facility in the notes to our consolidated financial statements ) . foreign exchange the company 's canadian business is subject to changes in demand or pricing resulting from fluctuations in currency exchange rates or other factors . we are subject to fluctuations primarily in the canadian dollar-to-u.s. dollar exchange rate . page 20 off-balance sheet arrangements as of december 31 , 2013 , we did not have any off-balance sheet arrangements , as defined in item 303 ( a ) ( 4 ) ( ii ) of sec regulation s-k. critical accounting policies and estimates management 's discussion and analysis of the company 's financial condition and results of operations are based upon the company 's consolidated financial statements that have been prepared in accordance with us gaap . the preparation of these financial statements requires the company to make estimates and judgments that affect the reported amounts of assets , liabilities , revenues and expenses , and related disclosure of contingent assets and liabilities . the company recognizes revenue from the sale of software and hardware for microcomputers , servers and networks on a gross revenue recognition basis upon shipment or upon electronic delivery of the product . on an on-going basis , the company evaluates its estimates , including those related to product returns , bad debts , inventories , investments , intangible assets , income taxes , stock-based compensation , contingencies and litigation . the company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances , the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources . actual results may differ from these estimates . the company believes the following critical accounting policies used in the preparation of its consolidated financial statements affect its more significant judgments and estimates . the company maintains allowances for doubtful accounts for estimated losses resulting from the inability of its customers to make required payments . if the financial condition of the company 's customers were to deteriorate , resulting in an impairment of their ability to make payments , additional allowances may be required . the company writes down its inventory for estimated obsolescence or unmarketable inventory equal to the difference between the cost of inventory and the estimated market value based upon assumptions about future demand and market conditions . if actual market conditions are less favorable than those projected by management , additional inventory write-offs may be required . the company has considered future taxable income and ongoing prudent and feasible tax planning strategies in assessing the need for the valuation allowance related to deferred tax assets . in the event the company were to determine that it would not be able to realize all or part of its net deferred tax assets in the future , an adjustment to the deferred tax assets would be charged to income in

