selling , general and administrative our selling , general and administrative ( “ sg & a ” ) expenses primarily consist of personnel-related expenses , including salaries , bonuses , fringe benefits and stock-based compensation , warehousing and distribution costs , depreciation of property and equipment , amortization of retail product displays and amortization of intangible assets . see “ critical accounting policies and estimates—stock-based compensation ” below for more detail regarding stock-based compensation . in the near term , we expect to continue to invest in our growth initiatives , including investments in the e.l.f . brand and infrastructure . over time , we expect our sg & a expenses to grow at a slower rate than our net sales growth as we leverage our past investments , including those made in 2015 and 2016 to support the reporting and compliance requirements associated with being a public company . interest expense , net interest expense primarily consists of cash interest and fees on our outstanding indebtedness . see “ financial condition , liquidity and capital resources ” below and a description of our indebtedness in note 8 to the notes to consolidated financial statements in item 15 “ exhibits , financial statement schedules ” . other income ( expense ) , net our purchases are largely in chinese renminbi ( “ rmb ” ) , and , as such , we are exposed to periodic fluctuations in that currency . while we do not have an active hedging program , we had a number of legacy exchange rate forward contracts that matured during the year ended december 31 , 2016. we did not apply hedge accounting , and therefore the periodic impact of these legacy hedging activities was calculated on a mark-to-market basis . other income ( expense ) , net is primarily a result of changes in the notional value of exchange rate forward contracts outstanding in prior periods , as well as fluctuations in the exchange rate in the rmb to the u.s. dollar . income tax benefit ( provision ) the provision for income taxes represents federal , foreign , state and local income taxes . the effective rate differs from statutory rates due to the effect of state and local income taxes , tax rates in foreign jurisdictions and certain permanent tax adjustments . our effective tax rate will change from quarter to quarter based on recurring and nonrecurring factors including , but not limited to , the geographical mix of earnings , enacted tax legislation , state and local income taxes , the impact of permanent tax adjustments , tax audit settlements and the interaction of various tax strategies . on december 22 , 2017 , the 2017 tax act was signed into law making significant changes to the internal revenue code of 1986 , as amended . changes included , but were not limited to , a reduction of the u.s. corporate tax rate from 35 % to 21 % effective january 1 , 2018. the 2017 tax act also imposed a one-time transition tax on previously deferred foreign earnings . as of december 31 , 2017 , we completed our accounting for the tax effects of the 2017 tax act . net income ( loss ) our net income ( loss ) for future periods will be affected by the various factors described above . seasonality our results of operations are subject to seasonal fluctuations , with net sales in the third and fourth calendar quarters typically being higher than in the first and second calendar quarters . the higher net sales in our third and fourth calendar quarters are largely attributable to the increased levels of purchasing by retailers for the holiday season , and adverse events that occur during the third or fourth calendar quarter could have a disproportionate effect on our results of operations for the entire fiscal year . as a result of higher sales during the third and fourth calendar quarters , we are required to make investments in working capital during the second and third quarters of the fiscal year . fluctuations throughout the year are also driven by the timing of product restocking or rearrangement by our major customers as well as our expansion into new customers . because a limited number of our retail customers account for a large percentage of our net sales , a change in the order pattern of one or more of our large retail customers could cause a significant fluctuation of our quarterly results or reduce our liquidity . 39 business trends tariffs recent tariffs have impacted certain products that we import from china which , without mitigation , will increase our cost of goods and may lower our gross profit and gross margin in future periods . we are currently evaluating various initiatives , including but not limited to , negotiating lower prices with our suppliers and selectively increasing prices on certain products , to mitigate the impact of the tariffs on our results of operations . in addition , any favorable movements in foreign exchange rates may reduce the impact of the tariffs . we can not provide any assurances that these mitigation initiatives will be successful . based on the timing of product imports relative to the enactment date , these tariffs contributed to an increase in inventory as of december 31 , 2018 but did not have a significant impact on gross profit in the year ended december 31 , 2018. e.l.f store closing on february 26 , 2019 , the company announced that it will exit the stand-alone e.l.f . retail store business . as part of the e.l.f . store closing , the company will close all 22 of its e.l.f . stores on february 26 , 2019 and implement a workforce reduction of its employees that manage and operate the e.l.f . stores . story_separator_special_tag revenue recognition we recognize revenue when control of promised goods or services is transferred to a customer in an amount that reflects the consideration that we expect to receive in exchange for those goods or services . control of the substantial majority of the products that we sell will be transferred at a point in time . factors that determine the specific point in time a customer obtains control and a performance obligation is satisfied are when we have a present right to payment for the goods , whether the customer has physical possession and title to the goods , and whether significant risks and rewards of ownership have transferred . delivery is typically considered to have occurred at the time the title and risk of loss passes to the customer . in the normal course of business , we offer various incentives to customers such as sales discounts , markdown support and other incentives and allowances , which give rise to variable consideration . the amount of variable consideration is estimated at the time of sale based on either the expected value method or the most likely amount , depending on the nature of the variability . we regularly review and revise , when deemed necessary , our estimates of variable consideration based on both customer-specific expectations as well as historical rates of realization . a provision for unclaimed customer incentives and allowances is included on the consolidated balance sheet , net against accounts receivable . impairment of long-lived assets , including goodwill and intangible assets we assess potential impairments to our long-lived assets , which include property and equipment , retail product displays , and amortizable intangible assets , whenever events or circumstances indicate that the carrying amount of an asset may not be recoverable . recoverability of an asset is measured by a comparison of the carrying amount of an asset group to the estimated undiscounted future cash flows expected to be generated by the asset . if the carrying amount of the asset group exceeds its estimated undiscounted future cash flows , an impairment charge is recognized as the amount by which the carrying amount of the asset exceeds the fair value of the asset . we recorded an impairment charge of $ 0.2 million in the year ended december 31 , 2017 related to specific assets that were disposed . there were no impairment charges recorded on long-lived assets during the years ended december 31 , 2018 or 2016 . we evaluate our indefinite-lived intangible asset to determine whether current events and circumstances continue to support an indefinite useful life . in addition , our indefinite-lived intangible asset is tested for impairment annually . the indefinite-lived intangible asset impairment test consists of a comparison of the fair value of each asset with its carrying value , with any excess of carrying value over fair value being recognized as an impairment loss . we are also permitted to make a qualitative assessment of whether it is more likely than not that an indefinite-lived intangible asset 's fair value is less than its carrying value prior to applying the quantitative assessment . if based on our qualitative assessment it is more likely than not that the carrying value of the asset is less than its fair value , then a quantitative assessment may be required . the goodwill impairment test consists of a comparison of each reporting unit 's fair value to its carrying value . the fair value of a reporting unit is an estimate of the amount for which the unit as a whole could be sold in a current transaction between willing parties . if the carrying value of a reporting unit exceeds its fair value , goodwill is written down to its implied fair value . we are also permitted to make a qualitative assessment of whether it is more likely than not that the fair 46 value of a reporting unit is less than its carrying value prior to applying the quantitative assessment . if based on our qualitative assessment it is more likely than not that the carrying value of the reporting unit is less than its fair value , then a quantitative assessment may be required . we have identified a single reporting unit for purposes of impairment testing . we have selected october 1 as the date on which to perform our annual impairment tests . we also test for impairment whenever events or circumstances indicate that the fair value of goodwill or indefinite-lived intangible assets has been impaired . no impairment of goodwill or our indefinite-lived intangible asset was recorded during the years ended december 31 , 2018 , 2017 or 2016 . stock-based compensation stock-based compensation cost is measured at grant date , based on the fair value of the award , and is recognized on a straight-line basis over the requisite service period for all awards that vest . we estimate the fair value of employee stock-based payment awards subject to only a service condition on the date of grant using the black-scholes valuation model . the black-scholes model requires the use of highly subjective and complex assumptions , including the option 's expected term and the price volatility of the underlying stock . we estimate the fair value of employee stock-based payment awards subject to market conditions on the date of grant using a monte carlo simulation model . forfeitures were previously estimated at the time of grant and revised , if necessary , in subsequent periods if actual forfeitures differed from those estimates . we early adopted accounting standards update ( “ asu ” ) 2016-09 , improvements to employee share-based payment accounting and , effective january 1 , 2016 , we now account for forfeitures as they occur . we recorded a cumulative-effect adjustment to retained earnings , which was not material , upon early adoption . we recognize compensation expense for awards with only a service condition on a straight-line basis over

cash used in investing activities for the year ended december 31 , 2018 , net cash used in investing activities was $ 8.9 million , compared to $ 10.4 million for the year ended december 31 , 2017 . the decrease was primarily attributable to a $ 2.9 million investment in a social media analytics company in the period ended december 31 , 2017 . this was partially offset by an increase in purchases of property and equipment including the implementation costs of a new e-commerce platform . for the year ended december 31 , 2017 , net cash used in investing activities was $ 10.4 million , compared to $ 9.1 million for the year ended december 31 , 2016. the increase was primarily attributable to the investment in the social media analytics company referenced above , partially offset by lower purchases of property and equipment . for the year ended december 31 , 2016 , net cash used in investing activities was $ 9.1 million , consisting primarily of purchases of property and equipment related to the build-out of new e.l.f . stores that opened in 2016 , as well as fixtures to support new distribution at national retailers . cash provided by ( used in ) financing activities for the year ended december 31 , 2018 , net cash used in financing activities was $ 5.6 million , primarily driven by $ 8.3 million in mandatory principal payments under our term loan facility ( as defined under the heading “ description of indebtedness ” ) . this was partially offset by $ 3.2 million of proceeds from the exercise of options to purchase common stock . for the year ended december 31 , 2017 , net cash used in financing activities was $ 7.2 million , primarily driven by $ 8.3 million in mandatory principal payments under our term loan facility ( as defined under the heading “ description of indebtedness ” ) . this was partially offset by $ 2.0 million of proceeds from the exercise of options to purchase 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.
     ```cash used in investing activities for the year ended december 31 , 2018 , net cash used in investing activities was $ 8.9 million , compared to $ 10.4 million for the year ended december 31 , 2017 . the decrease was primarily attributable to a $ 2.9 million investment in a social media analytics company in the period ended december 31 , 2017 . this was partially offset by an increase in purchases of property and equipment including the implementation costs of a new e-commerce platform . for the year ended december 31 , 2017 , net cash used in investing activities was $ 10.4 million , compared to $ 9.1 million for the year ended december 31 , 2016. the increase was primarily attributable to the investment in the social media analytics company referenced above , partially offset by lower purchases of property and equipment . for the year ended december 31 , 2016 , net cash used in investing activities was $ 9.1 million , consisting primarily of purchases of property and equipment related to the build-out of new e.l.f . stores that opened in 2016 , as well as fixtures to support new distribution at national retailers . cash provided by ( used in ) financing activities for the year ended december 31 , 2018 , net cash used in financing activities was $ 5.6 million , primarily driven by $ 8.3 million in mandatory principal payments under our term loan facility ( as defined under the heading “ description of indebtedness ” ) . this was partially offset by $ 3.2 million of proceeds from the exercise of options to purchase common stock . for the year ended december 31 , 2017 , net cash used in financing activities was $ 7.2 million , primarily driven by $ 8.3 million in mandatory principal payments under our term loan facility ( as defined under the heading “ description of indebtedness ” ) . this was partially offset by $ 2.0 million of proceeds from the exercise of options to purchase common stock .
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 Suspicious Activity Report : selling , general and administrative our selling , general and administrative ( “ sg & a ” ) expenses primarily consist of personnel-related expenses , including salaries , bonuses , fringe benefits and stock-based compensation , warehousing and distribution costs , depreciation of property and equipment , amortization of retail product displays and amortization of intangible assets . see “ critical accounting policies and estimates—stock-based compensation ” below for more detail regarding stock-based compensation . in the near term , we expect to continue to invest in our growth initiatives , including investments in the e.l.f . brand and infrastructure . over time , we expect our sg & a expenses to grow at a slower rate than our net sales growth as we leverage our past investments , including those made in 2015 and 2016 to support the reporting and compliance requirements associated with being a public company . interest expense , net interest expense primarily consists of cash interest and fees on our outstanding indebtedness . see “ financial condition , liquidity and capital resources ” below and a description of our indebtedness in note 8 to the notes to consolidated financial statements in item 15 “ exhibits , financial statement schedules ” . other income ( expense ) , net our purchases are largely in chinese renminbi ( “ rmb ” ) , and , as such , we are exposed to periodic fluctuations in that currency . while we do not have an active hedging program , we had a number of legacy exchange rate forward contracts that matured during the year ended december 31 , 2016. we did not apply hedge accounting , and therefore the periodic impact of these legacy hedging activities was calculated on a mark-to-market basis . other income ( expense ) , net is primarily a result of changes in the notional value of exchange rate forward contracts outstanding in prior periods , as well as fluctuations in the exchange rate in the rmb to the u.s. dollar . income tax benefit ( provision ) the provision for income taxes represents federal , foreign , state and local income taxes . the effective rate differs from statutory rates due to the effect of state and local income taxes , tax rates in foreign jurisdictions and certain permanent tax adjustments . our effective tax rate will change from quarter to quarter based on recurring and nonrecurring factors including , but not limited to , the geographical mix of earnings , enacted tax legislation , state and local income taxes , the impact of permanent tax adjustments , tax audit settlements and the interaction of various tax strategies . on december 22 , 2017 , the 2017 tax act was signed into law making significant changes to the internal revenue code of 1986 , as amended . changes included , but were not limited to , a reduction of the u.s. corporate tax rate from 35 % to 21 % effective january 1 , 2018. the 2017 tax act also imposed a one-time transition tax on previously deferred foreign earnings . as of december 31 , 2017 , we completed our accounting for the tax effects of the 2017 tax act . net income ( loss ) our net income ( loss ) for future periods will be affected by the various factors described above . seasonality our results of operations are subject to seasonal fluctuations , with net sales in the third and fourth calendar quarters typically being higher than in the first and second calendar quarters . the higher net sales in our third and fourth calendar quarters are largely attributable to the increased levels of purchasing by retailers for the holiday season , and adverse events that occur during the third or fourth calendar quarter could have a disproportionate effect on our results of operations for the entire fiscal year . as a result of higher sales during the third and fourth calendar quarters , we are required to make investments in working capital during the second and third quarters of the fiscal year . fluctuations throughout the year are also driven by the timing of product restocking or rearrangement by our major customers as well as our expansion into new customers . because a limited number of our retail customers account for a large percentage of our net sales , a change in the order pattern of one or more of our large retail customers could cause a significant fluctuation of our quarterly results or reduce our liquidity . 39 business trends tariffs recent tariffs have impacted certain products that we import from china which , without mitigation , will increase our cost of goods and may lower our gross profit and gross margin in future periods . we are currently evaluating various initiatives , including but not limited to , negotiating lower prices with our suppliers and selectively increasing prices on certain products , to mitigate the impact of the tariffs on our results of operations . in addition , any favorable movements in foreign exchange rates may reduce the impact of the tariffs . we can not provide any assurances that these mitigation initiatives will be successful . based on the timing of product imports relative to the enactment date , these tariffs contributed to an increase in inventory as of december 31 , 2018 but did not have a significant impact on gross profit in the year ended december 31 , 2018. e.l.f store closing on february 26 , 2019 , the company announced that it will exit the stand-alone e.l.f . retail store business . as part of the e.l.f . store closing , the company will close all 22 of its e.l.f . stores on february 26 , 2019 and implement a workforce reduction of its employees that manage and operate the e.l.f . stores . story_separator_special_tag revenue recognition we recognize revenue when control of promised goods or services is transferred to a customer in an amount that reflects the consideration that we expect to receive in exchange for those goods or services . control of the substantial majority of the products that we sell will be transferred at a point in time . factors that determine the specific point in time a customer obtains control and a performance obligation is satisfied are when we have a present right to payment for the goods , whether the customer has physical possession and title to the goods , and whether significant risks and rewards of ownership have transferred . delivery is typically considered to have occurred at the time the title and risk of loss passes to the customer . in the normal course of business , we offer various incentives to customers such as sales discounts , markdown support and other incentives and allowances , which give rise to variable consideration . the amount of variable consideration is estimated at the time of sale based on either the expected value method or the most likely amount , depending on the nature of the variability . we regularly review and revise , when deemed necessary , our estimates of variable consideration based on both customer-specific expectations as well as historical rates of realization . a provision for unclaimed customer incentives and allowances is included on the consolidated balance sheet , net against accounts receivable . impairment of long-lived assets , including goodwill and intangible assets we assess potential impairments to our long-lived assets , which include property and equipment , retail product displays , and amortizable intangible assets , whenever events or circumstances indicate that the carrying amount of an asset may not be recoverable . recoverability of an asset is measured by a comparison of the carrying amount of an asset group to the estimated undiscounted future cash flows expected to be generated by the asset . if the carrying amount of the asset group exceeds its estimated undiscounted future cash flows , an impairment charge is recognized as the amount by which the carrying amount of the asset exceeds the fair value of the asset . we recorded an impairment charge of $ 0.2 million in the year ended december 31 , 2017 related to specific assets that were disposed . there were no impairment charges recorded on long-lived assets during the years ended december 31 , 2018 or 2016 . we evaluate our indefinite-lived intangible asset to determine whether current events and circumstances continue to support an indefinite useful life . in addition , our indefinite-lived intangible asset is tested for impairment annually . the indefinite-lived intangible asset impairment test consists of a comparison of the fair value of each asset with its carrying value , with any excess of carrying value over fair value being recognized as an impairment loss . we are also permitted to make a qualitative assessment of whether it is more likely than not that an indefinite-lived intangible asset 's fair value is less than its carrying value prior to applying the quantitative assessment . if based on our qualitative assessment it is more likely than not that the carrying value of the asset is less than its fair value , then a quantitative assessment may be required . the goodwill impairment test consists of a comparison of each reporting unit 's fair value to its carrying value . the fair value of a reporting unit is an estimate of the amount for which the unit as a whole could be sold in a current transaction between willing parties . if the carrying value of a reporting unit exceeds its fair value , goodwill is written down to its implied fair value . we are also permitted to make a qualitative assessment of whether it is more likely than not that the fair 46 value of a reporting unit is less than its carrying value prior to applying the quantitative assessment . if based on our qualitative assessment it is more likely than not that the carrying value of the reporting unit is less than its fair value , then a quantitative assessment may be required . we have identified a single reporting unit for purposes of impairment testing . we have selected october 1 as the date on which to perform our annual impairment tests . we also test for impairment whenever events or circumstances indicate that the fair value of goodwill or indefinite-lived intangible assets has been impaired . no impairment of goodwill or our indefinite-lived intangible asset was recorded during the years ended december 31 , 2018 , 2017 or 2016 . stock-based compensation stock-based compensation cost is measured at grant date , based on the fair value of the award , and is recognized on a straight-line basis over the requisite service period for all awards that vest . we estimate the fair value of employee stock-based payment awards subject to only a service condition on the date of grant using the black-scholes valuation model . the black-scholes model requires the use of highly subjective and complex assumptions , including the option 's expected term and the price volatility of the underlying stock . we estimate the fair value of employee stock-based payment awards subject to market conditions on the date of grant using a monte carlo simulation model . forfeitures were previously estimated at the time of grant and revised , if necessary , in subsequent periods if actual forfeitures differed from those estimates . we early adopted accounting standards update ( “ asu ” ) 2016-09 , improvements to employee share-based payment accounting and , effective january 1 , 2016 , we now account for forfeitures as they occur . we recorded a cumulative-effect adjustment to retained earnings , which was not material , upon early adoption . we recognize compensation expense for awards with only a service condition on a straight-line basis over

