actual results may differ materially from the results discussed in the forward-looking statements . factors that might cause such a difference include , but are not limited to , those discussed in “ item 1a — risk factors . ” overview psychemedics corporation is the world 's largest provider of hair testing for drugs of abuse , utilizing a patented hair analysis method involving radioimmunoassay technology and confirmation by mass spectrometry to analyze human hair to detect abused substances . the company 's customers include fortune 500 companies , as well as small to mid-size corporations , schools and governmental entities located primarily in the united states . during the year ended december 31 , 2010 , the company generated $ 20.1 million in revenue , while maintaining a gross margin of 60 % and pre-tax margins of 22 % . at december 31 , 2010 , the company had $ 5.7 million of cash , cash equivalents and short-term investments . during 2010 , the company had operating cash flow of $ 3.3 million and it distributed approximately $ 2.5 million or $ 0.48 per share of cash dividends to its shareholders . to date , the company has paid fifty-eight consecutive quarterly cash dividends . 15 the following table sets forth , for the periods indicated , the selected statements of operations data as a percentage of total revenue : replace_table_token_4_th results for the year ended december 31 , 2010 compared to results for the year ended december 31 , 2009 revenue increased $ 3.2 million or 19 % to $ 20.1 million in 2010 compared to $ 17.0 million in 2009. this increase was due to an increase in volume from new and existing clients . average revenue per sample increased 2 % between 2010 and 2009. gross profit increased $ 2.4 million to $ 12.0 million in 2010 compared to $ 9.6 million in 2009. direct costs increased by 10 % from 2009 to 2010 , mainly associated with the direct cost of materials resulting from higher volumes . the gross profit margin increased from 57 % in 2009 to 60 % in 2010 as revenue increased more than direct costs . general and administrative ( “ g & a ” ) expenses were $ 4.2 million for the year ended december 31 , 2010 compared to $ 3.6 million for the year ended december 31 , 2009 , representing an increase of 17 % . as a percentage of revenue , g & a expenses were 20.9 % and 21.2 % for the years ended december 31 , 2010 and 2009 , respectively . the increase in general and administrative expenses in 2010 was due to several factors : an increase in salary expense due to the reinstatement of salaries in 2010 following a salary cut in the second half of 2009 , an increase in accounting and audit fees , an increase in legal fees defending our technology on behalf of our customers , and bonuses earned in 2010 and not in 2009. marketing and selling expenses were $ 2.9 million for the year ended december 31 , 2010 , compared to $ 3.0 million for the year ended december 31 , 2009 , a decrease of less than 1 % . total marketing and selling expenses represented 14.6 % and 17.5 % of revenue for the years ended december 31 , 2010 and 2009 , respectively . research and development ( “ r & d ” ) expenses for 2010 were $ 0.5 million compared to $ 0.5 million for 2009. r & d expenses represented 2.4 % and 2.8 % of revenue for the years ended december 31 , 2010 and 2009 , respectively . interest income decreased approximately $ 22,000 to approximately $ 23,000 for the year ended december 31 , 2010 compared to $ 45,000 for the year ended december 31 , 2009. interest income in both periods represented interest and dividends earned on cash equivalents and short-term investments . a decrease in the yield on investment balances in 2010 as compared to 2009 caused the decrease in interest income . during the year ended december 31 , 2010 , the company recorded a tax provision of $ 1.8 million , representing an effective tax rate of 41.1 % . during the year ended december 31 , 2009 , the company recorded a tax provision of $ 1.1 million , representing an effective tax rate of 41.9 % . we do not expect a significant change in our tax rate in the foreseeable future . 16 results for the year ended december 31 , 2009 compared to results for the year ended december 31 , 2008 revenue decreased $ 6.0 million or 26 % to $ 17.0 million in 2009 compared to $ 22.9 million in 2008. this decrease was due in part to decreased testing volume , which fell 26 % compared to 2008. average revenue per sample was unchanged between 2009 and 2008. revenue included the recognition of deferred revenue relating to the sale of pdt-90 products was $ 0.1 million for each of the years ended december 31 , 2009 and 2008. gross profit decreased $ 3.7 million to $ 9.6 million in 2009 compared to $ 13.4 million in 2008. direct costs decreased by 23 % from 2008 to 2009 , mainly due to lower labor and associated direct cost of materials . the gross profit margin fell from 58 % in 2008 to 57 % in 2009 as revenue declined more than direct costs . story_separator_special_tag the company routinely assesses the financial strength of its customers and , as a consequence , believes that its accounts receivable credit risk exposure is limited . the company maintains an allowance for potential credit losses but historically has not experienced any significant losses related to individual customers or groups of customers in any particular industry or geographic area . bad debt expense has been within management 's expectations . income taxes the company accounts for income taxes using the liability method , which requires the company to recognize a current tax liability or asset for current taxes payable or refundable and a deferred tax liability or asset for the estimated future tax effects of temporary differences between the financial statement and tax reporting bases of assets and liabilities to the extent that they are realizable . deferred tax expense ( benefit ) results from the net change in deferred tax assets and liabilities during the year . a deferred tax valuation allowance is required if it is more likely than not that all or a portion of the recorded deferred tax assets will not be realized . 19 the company had net deferred tax assets in the amount of $ 240,000 at december 31 , 2010 , which the company believes are fully realizable based upon expected future taxable income , which the company 's believes is reasonably attainable in light of previous operating results during the past three years . the company operates within multiple taxing jurisdictions and could be subject to audit in these jurisdictions . these audits may involve complex issues , which may require an extended period of time to resolve . the company has provided for its estimated taxes payable in the accompanying financial statements . interest and penalties related to income tax matters are recognized as a general and administrative expense . the company did not have any unrecognized tax benefits and did not have any interest or penalties accrued as of december 31 , 2010 or 2009. the company does not expect the unrecognized tax benefits to change significantly over the next twelve months . the above listing is not intended to be a comprehensive list of all of the company 's accounting policies . in many cases , the accounting treatment of a particular transaction is specifically dictated by accounting principles generally accepted in the united states , with no need for management 's judgment in their application . there are also areas in which management 's judgment in selecting any available alternative would not produce a materially different result . recent accounting pronouncements in april 2010 , the fasb issued accounting standards update , or , asu , no . 2010-17 , revenue recognition — milestone method ( topic 605 ) : milestone method of revenue recognition , or asu 2010-17. asu 2010-17 allows the milestone method as an acceptable revenue recognition methodology when an arrangement includes substantive milestones . asu 2010-17 provides a definition of substantive milestone and should be applied regardless of whether the arrangement includes single or multiple deliverables or units of accounting . asu 2010-17 is limited to transactions involving milestones relating to research and development deliverables . asu 2010-17 also includes enhanced disclosure requirements about each arrangement , individual milestones and related contingent consideration , information about substantive milestones and factors considered in the determination . asu 2010-17 is effective on a prospective basis for milestones achieved in fiscal years , and interim periods within those years , beginning on or after june 15 , 2010 , with early adoption permitted . the adoption of this standard is not expected to have a material impact on the company 's financial position , results of operations or cash flows . in october 2009 , the fasb issued asu no . 2009-14 , software ( topic 985 ) : certain revenue arrangements that include software elements — a consensus of the fasb eitf , or asu 2009-14. asu 2009-14 changes the accounting model for revenue arrangements that include tangible products and software elements . the amendments of this update provide additional guidance on how to determine which software , if any , relating to the tangible product also would be excluded from the scope of the software revenue recognition guidance . the amendments in this update also provide guidance on how a vendor should allocate arrangement consideration to deliverables in an arrangement that includes both tangible products and software , as well as arrangements that have deliverables both included and excluded from the scope of software revenue recognition guidance . this standard is effective prospectively for revenue arrangements entered into or materially modified in fiscal years beginning on or after june 15 , 2010. the adoption of this standard is not expected to have a material impact on the company 's financial position , results of operations or cash flows . in october 2009 , the fasb issued asu no . 2009-13 , revenue recognition ( topic 605 ) : multiple-deliverable revenue arrangements — a consensus of the fasb eitf , or asu 2009-13. asu 2009-13 will separate multiple-deliverable revenue arrangements . this update establishes a selling price hierarchy for determining the selling price of a deliverable . the amendments of this update will replace the term “ fair value ” in the revenue allocation guidance with “ selling price ” to clarify that the allocation of revenue is based on entity-specific assumptions rather than assumptions of a marketplace participant . the amendments of this update will eliminate the residual method of allocation and require that arrangement consideration be allocated at the inception of the arrangement to all deliverables using the relative selling price method . the amendments in this update will require that a vendor determine its best estimated selling price in a manner consistent with that used to determine the price to sell the deliverable on a standalone basis . this standard is effective prospectively for revenue arrangements entered into or materially modified in fiscal

liquidity and capital resources at december 31 , 2010 , the company had $ 5.7 million of cash , cash equivalents and short term investments , compared to $ 5.8 million at december 31 , 2009. the company 's operating activities generated net cash of $ 3.3 million in 2010 , $ 2.4 million in 2009 and $ 3.7 million in 2008. investing activities used $ 1.9 million in 2010 , used $ 1.1 million in 2009 and generated $ 3.5 million in 2008. financing activities used $ 2.6 million in 2010 , $ 3.1 million in 2009 and $ 6.7 million in 2008. operating cash flow of $ 3.3 million in 2010 primarily reflected net income of $ 2.6 million adjusted for depreciation and amortization of $ 0.3 million , stock compensation expense of $ 0.4 million , an increase in prepaid expenses and accounts receivable of $ 0.9 million and an increase in accounts payable of $ 0.5 million , and an increase in accrued expenses of $ 0.2 million . operating cash flow of $ 2.4 million in 2009 primarily reflected net income of $ 1.5 million adjusted for depreciation and amortization of $ 0.3 million , stock compensation expense of $ 0.4 million , a decrease in prepaid expenses and accounts receivable of $ 0.8 million and accounts payable of $ 0.5 million , and a decrease in accrued expenses of $ 0.2 million . operating cash flow of $ 3.7 million in 2008 primarily reflected net income of $ 3.0 million adjusted for depreciation and amortization of $ 0.3 million , stock compensation expense of $ 0.4 million and an increase in prepaid expenses of $ 0.6 million , offset by an increase in accrued expenses of $ 0.3 million .


 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 at december 31 , 2010 , the company had $ 5.7 million of cash , cash equivalents and short term investments , compared to $ 5.8 million at december 31 , 2009. the company 's operating activities generated net cash of $ 3.3 million in 2010 , $ 2.4 million in 2009 and $ 3.7 million in 2008. investing activities used $ 1.9 million in 2010 , used $ 1.1 million in 2009 and generated $ 3.5 million in 2008. financing activities used $ 2.6 million in 2010 , $ 3.1 million in 2009 and $ 6.7 million in 2008. operating cash flow of $ 3.3 million in 2010 primarily reflected net income of $ 2.6 million adjusted for depreciation and amortization of $ 0.3 million , stock compensation expense of $ 0.4 million , an increase in prepaid expenses and accounts receivable of $ 0.9 million and an increase in accounts payable of $ 0.5 million , and an increase in accrued expenses of $ 0.2 million . operating cash flow of $ 2.4 million in 2009 primarily reflected net income of $ 1.5 million adjusted for depreciation and amortization of $ 0.3 million , stock compensation expense of $ 0.4 million , a decrease in prepaid expenses and accounts receivable of $ 0.8 million and accounts payable of $ 0.5 million , and a decrease in accrued expenses of $ 0.2 million . operating cash flow of $ 3.7 million in 2008 primarily reflected net income of $ 3.0 million adjusted for depreciation and amortization of $ 0.3 million , stock compensation expense of $ 0.4 million and an increase in prepaid expenses of $ 0.6 million , offset by an increase in accrued expenses of $ 0.3 million .
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 Suspicious Activity Report : actual results may differ materially from the results discussed in the forward-looking statements . factors that might cause such a difference include , but are not limited to , those discussed in “ item 1a — risk factors . ” overview psychemedics corporation is the world 's largest provider of hair testing for drugs of abuse , utilizing a patented hair analysis method involving radioimmunoassay technology and confirmation by mass spectrometry to analyze human hair to detect abused substances . the company 's customers include fortune 500 companies , as well as small to mid-size corporations , schools and governmental entities located primarily in the united states . during the year ended december 31 , 2010 , the company generated $ 20.1 million in revenue , while maintaining a gross margin of 60 % and pre-tax margins of 22 % . at december 31 , 2010 , the company had $ 5.7 million of cash , cash equivalents and short-term investments . during 2010 , the company had operating cash flow of $ 3.3 million and it distributed approximately $ 2.5 million or $ 0.48 per share of cash dividends to its shareholders . to date , the company has paid fifty-eight consecutive quarterly cash dividends . 15 the following table sets forth , for the periods indicated , the selected statements of operations data as a percentage of total revenue : replace_table_token_4_th results for the year ended december 31 , 2010 compared to results for the year ended december 31 , 2009 revenue increased $ 3.2 million or 19 % to $ 20.1 million in 2010 compared to $ 17.0 million in 2009. this increase was due to an increase in volume from new and existing clients . average revenue per sample increased 2 % between 2010 and 2009. gross profit increased $ 2.4 million to $ 12.0 million in 2010 compared to $ 9.6 million in 2009. direct costs increased by 10 % from 2009 to 2010 , mainly associated with the direct cost of materials resulting from higher volumes . the gross profit margin increased from 57 % in 2009 to 60 % in 2010 as revenue increased more than direct costs . general and administrative ( “ g & a ” ) expenses were $ 4.2 million for the year ended december 31 , 2010 compared to $ 3.6 million for the year ended december 31 , 2009 , representing an increase of 17 % . as a percentage of revenue , g & a expenses were 20.9 % and 21.2 % for the years ended december 31 , 2010 and 2009 , respectively . the increase in general and administrative expenses in 2010 was due to several factors : an increase in salary expense due to the reinstatement of salaries in 2010 following a salary cut in the second half of 2009 , an increase in accounting and audit fees , an increase in legal fees defending our technology on behalf of our customers , and bonuses earned in 2010 and not in 2009. marketing and selling expenses were $ 2.9 million for the year ended december 31 , 2010 , compared to $ 3.0 million for the year ended december 31 , 2009 , a decrease of less than 1 % . total marketing and selling expenses represented 14.6 % and 17.5 % of revenue for the years ended december 31 , 2010 and 2009 , respectively . research and development ( “ r & d ” ) expenses for 2010 were $ 0.5 million compared to $ 0.5 million for 2009. r & d expenses represented 2.4 % and 2.8 % of revenue for the years ended december 31 , 2010 and 2009 , respectively . interest income decreased approximately $ 22,000 to approximately $ 23,000 for the year ended december 31 , 2010 compared to $ 45,000 for the year ended december 31 , 2009. interest income in both periods represented interest and dividends earned on cash equivalents and short-term investments . a decrease in the yield on investment balances in 2010 as compared to 2009 caused the decrease in interest income . during the year ended december 31 , 2010 , the company recorded a tax provision of $ 1.8 million , representing an effective tax rate of 41.1 % . during the year ended december 31 , 2009 , the company recorded a tax provision of $ 1.1 million , representing an effective tax rate of 41.9 % . we do not expect a significant change in our tax rate in the foreseeable future . 16 results for the year ended december 31 , 2009 compared to results for the year ended december 31 , 2008 revenue decreased $ 6.0 million or 26 % to $ 17.0 million in 2009 compared to $ 22.9 million in 2008. this decrease was due in part to decreased testing volume , which fell 26 % compared to 2008. average revenue per sample was unchanged between 2009 and 2008. revenue included the recognition of deferred revenue relating to the sale of pdt-90 products was $ 0.1 million for each of the years ended december 31 , 2009 and 2008. gross profit decreased $ 3.7 million to $ 9.6 million in 2009 compared to $ 13.4 million in 2008. direct costs decreased by 23 % from 2008 to 2009 , mainly due to lower labor and associated direct cost of materials . the gross profit margin fell from 58 % in 2008 to 57 % in 2009 as revenue declined more than direct costs . story_separator_special_tag the company routinely assesses the financial strength of its customers and , as a consequence , believes that its accounts receivable credit risk exposure is limited . the company maintains an allowance for potential credit losses but historically has not experienced any significant losses related to individual customers or groups of customers in any particular industry or geographic area . bad debt expense has been within management 's expectations . income taxes the company accounts for income taxes using the liability method , which requires the company to recognize a current tax liability or asset for current taxes payable or refundable and a deferred tax liability or asset for the estimated future tax effects of temporary differences between the financial statement and tax reporting bases of assets and liabilities to the extent that they are realizable . deferred tax expense ( benefit ) results from the net change in deferred tax assets and liabilities during the year . a deferred tax valuation allowance is required if it is more likely than not that all or a portion of the recorded deferred tax assets will not be realized . 19 the company had net deferred tax assets in the amount of $ 240,000 at december 31 , 2010 , which the company believes are fully realizable based upon expected future taxable income , which the company 's believes is reasonably attainable in light of previous operating results during the past three years . the company operates within multiple taxing jurisdictions and could be subject to audit in these jurisdictions . these audits may involve complex issues , which may require an extended period of time to resolve . the company has provided for its estimated taxes payable in the accompanying financial statements . interest and penalties related to income tax matters are recognized as a general and administrative expense . the company did not have any unrecognized tax benefits and did not have any interest or penalties accrued as of december 31 , 2010 or 2009. the company does not expect the unrecognized tax benefits to change significantly over the next twelve months . the above listing is not intended to be a comprehensive list of all of the company 's accounting policies . in many cases , the accounting treatment of a particular transaction is specifically dictated by accounting principles generally accepted in the united states , with no need for management 's judgment in their application . there are also areas in which management 's judgment in selecting any available alternative would not produce a materially different result . recent accounting pronouncements in april 2010 , the fasb issued accounting standards update , or , asu , no . 2010-17 , revenue recognition — milestone method ( topic 605 ) : milestone method of revenue recognition , or asu 2010-17. asu 2010-17 allows the milestone method as an acceptable revenue recognition methodology when an arrangement includes substantive milestones . asu 2010-17 provides a definition of substantive milestone and should be applied regardless of whether the arrangement includes single or multiple deliverables or units of accounting . asu 2010-17 is limited to transactions involving milestones relating to research and development deliverables . asu 2010-17 also includes enhanced disclosure requirements about each arrangement , individual milestones and related contingent consideration , information about substantive milestones and factors considered in the determination . asu 2010-17 is effective on a prospective basis for milestones achieved in fiscal years , and interim periods within those years , beginning on or after june 15 , 2010 , with early adoption permitted . the adoption of this standard is not expected to have a material impact on the company 's financial position , results of operations or cash flows . in october 2009 , the fasb issued asu no . 2009-14 , software ( topic 985 ) : certain revenue arrangements that include software elements — a consensus of the fasb eitf , or asu 2009-14. asu 2009-14 changes the accounting model for revenue arrangements that include tangible products and software elements . the amendments of this update provide additional guidance on how to determine which software , if any , relating to the tangible product also would be excluded from the scope of the software revenue recognition guidance . the amendments in this update also provide guidance on how a vendor should allocate arrangement consideration to deliverables in an arrangement that includes both tangible products and software , as well as arrangements that have deliverables both included and excluded from the scope of software revenue recognition guidance . this standard is effective prospectively for revenue arrangements entered into or materially modified in fiscal years beginning on or after june 15 , 2010. the adoption of this standard is not expected to have a material impact on the company 's financial position , results of operations or cash flows . in october 2009 , the fasb issued asu no . 2009-13 , revenue recognition ( topic 605 ) : multiple-deliverable revenue arrangements — a consensus of the fasb eitf , or asu 2009-13. asu 2009-13 will separate multiple-deliverable revenue arrangements . this update establishes a selling price hierarchy for determining the selling price of a deliverable . the amendments of this update will replace the term “ fair value ” in the revenue allocation guidance with “ selling price ” to clarify that the allocation of revenue is based on entity-specific assumptions rather than assumptions of a marketplace participant . the amendments of this update will eliminate the residual method of allocation and require that arrangement consideration be allocated at the inception of the arrangement to all deliverables using the relative selling price method . the amendments in this update will require that a vendor determine its best estimated selling price in a manner consistent with that used to determine the price to sell the deliverable on a standalone basis . this standard is effective prospectively for revenue arrangements entered into or materially modified in fiscal

