revenue is recognized upon cash receipt growth in the u.s. due to the onboarding of new distributors and the continued adoption of our tl-hex product line , which grew by approximately 50 % in the u.s. compared to the prior year 35 spine fixation spine fixation designs , develops and markets a broad portfolio of implant products used in surgical procedures of the spine . spine fixation distributes its products globally through a network of distributors and sales representatives to sell spine products to hospitals and healthcare providers . 2017 compared to 2016 net sales increased $ 9.3 million or 12.8 % increase of 20.6 % in u.s. sales due to the addition of new distributor partners in the last several quarters ; the uptake of recent product introductions , including our ptc family product lines and cetra ; and improved legacy distributor engagement despite strong performance in certain locations , such as australia , year-over-year international sales decreased largely due to a decrease in order volumes from international stocking distributors 2016 compared to 2015 net sales decreased $ 3.0 million or 4.0 % exclusion from a large national hospital group purchasing organization in the second quarter of 2016 loss of several key surgeon customers in early 2016 decrease in cash collections of approximately 6 % in 2016 from distributors whose revenue is recognized upon cash receipt partially offset by revenue from additional distributors added in 2016 biologics biologics provides a portfolio of regenerative products and tissue forms that allow physicians to successfully treat a variety of spinal and orthopedic conditions . biologics markets its tissues to hospitals and healthcare providers , primarily in the u.s. , through a network of employed and independent sales representatives . 2017 compared to 2016 net sales increased $ 4.8 million or 8.3 % increase in volume for our trinity products primarily driven by the addition of new distributors over the past year benefit from improving performance from our national distribution partner and the reacquisition of a national hospital contract 2016 compared to 2015 net sales decreased $ 1.9 million or 3.2 % a growing number of competitors in the stem cell allograft market and an associated 2.4 % reduction in average selling price for our products exclusion from a large national hospital group purchasing organization in the second quarter of 2016 partially offset by an increase in the total number of independent distributors in 2016 36 gross profit and non-gaap net margin replace_table_token_6_th 2017 compared to 2016 non-gaap net margin , an internal metric that we define as gross profit less sales and marketing expense , increased $ 1.8 million gross profit increased $ 18.9 million o largely driven by the increase in net sales for our each of sbus , as gross margin remained relatively flat o partially offset by an increase of $ 0.2 million in expense relating to our extremity fixation and u.s. restructurings sales and marketing expense increased $ 17.1 million o primarily relating to higher commission expenses in 2017 , relating to geographic mix in extremity fixation and higher commission rates from new distributors for biologics and spine fixation , and an increase in other compensation costs as a result of the increase in net sales 2016 compared to 2015 non-gaap net margin increased $ 8.8 million gross profit increased $ 12.0 million o increase in sales for biostim and extremity fixation , partially offset by a decrease in sales for biologics and spine fixation o improved operating efficiencies through the absorption of fixed costs o increase in inventory reserves of $ 1.7 million for certain slower moving product lines and obsolete inventory , a portion of which is a result of our planned restructuring in brazil sales and marketing expense increased $ 3.2 million o increase in compensation and benefits costs , including commissions , as a result of the increase in net sales o partially offset by a reduction of certain indirect tax liabilities of $ 3.1 million in 2016 o also partially offset by a decrease in bad debt expense of $ 2.3 million related to puerto rico the following table presents non-gaap net margin by reporting segment . the reasons for the changes in non-gaap net margin by sbu are generally consistent with the information provided above for gross profit and sales and marketing expense . replace_table_token_7_th 37 general and administrative expense replace_table_token_8_th 2017 compared to 2016 general and administrative expense decreased less than $ 0.1 million decrease of $ 3.6 million from a reduction in project bluecore expenses , as the project was completed in 2016 decrease in share-based compensation expense of $ 3.5 million , largely driven by a net decrease in expense attributable to performance-based and market-based awards core expense reductions through savings in other professional fees of $ 2.0 million partially offset by an increase in spending of $ 5.7 million for evaluation of strategic investments further offset by an unfavorable change related to legal settlements of $ 3.5 million , largely as a result of a favorable commercial litigation settlement received in 2016 of $ 3.0 million 2016 compared to 2015 general and administrative expense decreased $ 12.8 million decreases in professional fees of $ 7.9 million , largely associated with the completion in 2016 of our internal control remediation efforts and project bluecore , a company-wide infrastructure initiative to improve the reliability and efficiency of our systems , processes , and reporting reduced legal costs of $ 6.9 million , largely due to legal settlements incurred in the prior year and a commercial legal settlement in 2016 whereby we received $ 3.0 million the moratorium on the medical device tax in 2016 , which decreased expense by $ 1.3 million reduction in other controllable expenses overall decrease was partially offset by increased share-based compensation expense of $ 8.1 million , including $ 5.7 million associated with the determination in 2016 that achieving the performance criteria related to certain of our performance-based vesting restricted stock awards is probable research story_separator_special_tag responded , to the proceeding , investigation or claim . our assessment of these factors may change over tim e as individual proceedings , investigations or claims progress . for matters where we are not currently able to reasonably estimate the range of reasonably possible loss , the factors that have contributed to this determination include the following : ( i ) the damages sought are indeterminate , or an investigation has not manifested itself in a filed civil or criminal complaint , ( ii ) the matters are in the early stages , ( iii ) the matters involve novel or unsettled legal theories or a large or uncertain number of actual or potential cases or parties , and or ( iv ) discussions with the government or other parties in matters that may be expected ultimately to be resolved through negotiation and settlement have not reached the point where we believe a reasonable estima te of loss , or range of loss , can be made . in such instances , we believe that there is considerable uncertainty regarding the timing or ultimate resolution of such matters , including a possible eventual loss , fine , penalty or business impact , if any . changes in the facts and circumstances associated with a claim could have a material impact on our results of operations and cash flows in the period that reserve estimates are revised . we believe our insurance coverage and reserves are sufficient to cover currently estimated exposures , but we can not give any assurance that we will not incur liabilities in excess of recorded reserves or our present insurance coverage . litigation and contingent liabilities are “ critical accounting estimates ” because changes in the assumptions used to develop the estimates could materially affect key financial measures , including operating income and net income . tax matters we and each of our subsidiaries are taxed at the rates applicable within each of their respective jurisdictions . our income tax expense , effective tax rate , deferred tax assets and deferred tax liabilities will vary according to the jurisdiction in which profits arise . further , certain of our subsidiaries sell products directly to our other subsidiaries or provide administrative , marketing and support services to our other subsidiaries . these intercompany sales and support services involve subsidiaries operating in jurisdictions with differing tax rates . the tax authorities in such jurisdictions may challenge our treatments under residency criteria , transfer pricing provisions , or other aspects of their respective tax laws , which could affect our composite tax rate and provisions . we sometimes engage in transactions in which tax consequences may be subject to uncertainty . we account for these uncertain tax positions in accordance with applicable accounting guidance , which requires significant judgment in assessing the estimated tax consequences of a transaction . we evaluate the tax position taken or expected to be taken in a tax return by determining if the weight of available evidence indicates that it is more likely than not that , on an evaluation of the technical merits , the tax position will be sustained on audit , including resolution of any related appeals or litigation processes . we measure the tax benefit as the largest amount that is more than 50 % likely to be realized upon ultimate settlement . we re-evaluate our income tax positions periodically to consider factors such as changes in facts or circumstances , changes in or interpretations of tax law , effectively settled issues under audit and new audit activity . such a change in recognition or measurement would result in recognition of a tax benefit or an additional charge to the tax provision . we establish a valuation allowance when measuring deferred tax assets if it is more likely than not that certain deferred tax assets will not be realized in the foreseeable future . this process requires significant judgment as we must project the current tax liability and estimate the deferred tax assets and liabilities into future periods , including net operating loss and tax credit carry forwards . in assessing the need for a valuation allowance , we consider recent operating results , availability of taxable income in carryback years , future reversals of taxable temporary differences , future taxable income projections ( exclusive of reversing temporary differences ) and all prudent and feasible tax planning strategies . on december 22 , 2017 , staff accounting bulletin no . 118 ( “ sab 118 ” ) was issued to address the application of u.s. gaap in situations when a registrant does not have the necessary information available , prepared , or analyzed ( including computations ) in reasonable detail to complete the accounting for certain income tax effects of the tax act . in accordance with sab 118 , we have determine that the $ 8.6 million of the deferred tax expense recorded in connection with the remeasurement of certain deferred tax assets and liabilities and the zero transition tax on the mandatory deemed repatriation of foreign earnings was a provisional amount and a reasonable estimate at december 31 , 2017. additional work is necessary for a more detailed analysis of our deferred tax assets and liabilities and our historical foreign earnings as well as potential correlative adjustments . any subsequent adjustment to those amounts will be recorded to current tax expense in the quarter of 2018 when the analysis is complete . 45 tax matters are “ critical accounting estimates ” because changes in the assumptions used to develop the estimates could materially affect key financial measures , including net income . share-based compensation determining the appropriate fair value model and calculating the fair value of employee stock awards requires estimates and judgments . our share-based compensation is a “ critical accounting estimate ” because changes in the assumptions used to develop estimates of fair value or the requisite service period could materially affect key financial measures

liquidity and capital resources cash and cash equivalents at december 31 , 2017 were $ 81.2 million compared to $ 39.6 million at december 31 , 2016. replace_table_token_14_th the following table presents free cash flow , a non-gaap financial measure , which is calculated by subtracting capital expenditures from net cash from operating activities . replace_table_token_15_th operating activities cash flows from operating activities increased $ 8.6 million increase in net income of $ 3.2 million net increase of $ 10.6 million for non-cash gains and losses , primarily related to deferred income taxes , share-based compensation expense , and the other-than-temporary impairments incurred relating to the eneura debt security net decrease of $ 5.1 million relating to changes in working capital , primarily attributable to increases in our inventory balance as a result of new product introductions and increases in accounts receivable as a result of the increase in net sales , and partially offset by a decrease in our other current liabilities our two primary working capital accounts are trade accounts receivable and inventory . day 's sales in receivables were 53 days at december 31 , 2017 compared to 52 days at december 31 , 2016. inventory turns were 1.1 times as of december 31 , 2017 compared to 1.4 times at december 31 , 2016 , as a result of increased inventory due to new product introductions , primarily in our spine fixation and extremity fixation sbus . u.s. government resolutions in december 2016 , we submitted offers of settlement to the sec relating to ( 1 ) our prior accounting review and restatements of financial statements and ( 2 ) allegations of improper payments in brazil , and placed $ 14.4 million into escrow for subsequent distribution to the sec relating to these matters . in january 2017 , the sec approved our offers of settlement and the amounts were released to the sec .


 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 cash and cash equivalents at december 31 , 2017 were $ 81.2 million compared to $ 39.6 million at december 31 , 2016. replace_table_token_14_th the following table presents free cash flow , a non-gaap financial measure , which is calculated by subtracting capital expenditures from net cash from operating activities . replace_table_token_15_th operating activities cash flows from operating activities increased $ 8.6 million increase in net income of $ 3.2 million net increase of $ 10.6 million for non-cash gains and losses , primarily related to deferred income taxes , share-based compensation expense , and the other-than-temporary impairments incurred relating to the eneura debt security net decrease of $ 5.1 million relating to changes in working capital , primarily attributable to increases in our inventory balance as a result of new product introductions and increases in accounts receivable as a result of the increase in net sales , and partially offset by a decrease in our other current liabilities our two primary working capital accounts are trade accounts receivable and inventory . day 's sales in receivables were 53 days at december 31 , 2017 compared to 52 days at december 31 , 2016. inventory turns were 1.1 times as of december 31 , 2017 compared to 1.4 times at december 31 , 2016 , as a result of increased inventory due to new product introductions , primarily in our spine fixation and extremity fixation sbus . u.s. government resolutions in december 2016 , we submitted offers of settlement to the sec relating to ( 1 ) our prior accounting review and restatements of financial statements and ( 2 ) allegations of improper payments in brazil , and placed $ 14.4 million into escrow for subsequent distribution to the sec relating to these matters . in january 2017 , the sec approved our offers of settlement and the amounts were released to the sec .
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 Suspicious Activity Report : revenue is recognized upon cash receipt growth in the u.s. due to the onboarding of new distributors and the continued adoption of our tl-hex product line , which grew by approximately 50 % in the u.s. compared to the prior year 35 spine fixation spine fixation designs , develops and markets a broad portfolio of implant products used in surgical procedures of the spine . spine fixation distributes its products globally through a network of distributors and sales representatives to sell spine products to hospitals and healthcare providers . 2017 compared to 2016 net sales increased $ 9.3 million or 12.8 % increase of 20.6 % in u.s. sales due to the addition of new distributor partners in the last several quarters ; the uptake of recent product introductions , including our ptc family product lines and cetra ; and improved legacy distributor engagement despite strong performance in certain locations , such as australia , year-over-year international sales decreased largely due to a decrease in order volumes from international stocking distributors 2016 compared to 2015 net sales decreased $ 3.0 million or 4.0 % exclusion from a large national hospital group purchasing organization in the second quarter of 2016 loss of several key surgeon customers in early 2016 decrease in cash collections of approximately 6 % in 2016 from distributors whose revenue is recognized upon cash receipt partially offset by revenue from additional distributors added in 2016 biologics biologics provides a portfolio of regenerative products and tissue forms that allow physicians to successfully treat a variety of spinal and orthopedic conditions . biologics markets its tissues to hospitals and healthcare providers , primarily in the u.s. , through a network of employed and independent sales representatives . 2017 compared to 2016 net sales increased $ 4.8 million or 8.3 % increase in volume for our trinity products primarily driven by the addition of new distributors over the past year benefit from improving performance from our national distribution partner and the reacquisition of a national hospital contract 2016 compared to 2015 net sales decreased $ 1.9 million or 3.2 % a growing number of competitors in the stem cell allograft market and an associated 2.4 % reduction in average selling price for our products exclusion from a large national hospital group purchasing organization in the second quarter of 2016 partially offset by an increase in the total number of independent distributors in 2016 36 gross profit and non-gaap net margin replace_table_token_6_th 2017 compared to 2016 non-gaap net margin , an internal metric that we define as gross profit less sales and marketing expense , increased $ 1.8 million gross profit increased $ 18.9 million o largely driven by the increase in net sales for our each of sbus , as gross margin remained relatively flat o partially offset by an increase of $ 0.2 million in expense relating to our extremity fixation and u.s. restructurings sales and marketing expense increased $ 17.1 million o primarily relating to higher commission expenses in 2017 , relating to geographic mix in extremity fixation and higher commission rates from new distributors for biologics and spine fixation , and an increase in other compensation costs as a result of the increase in net sales 2016 compared to 2015 non-gaap net margin increased $ 8.8 million gross profit increased $ 12.0 million o increase in sales for biostim and extremity fixation , partially offset by a decrease in sales for biologics and spine fixation o improved operating efficiencies through the absorption of fixed costs o increase in inventory reserves of $ 1.7 million for certain slower moving product lines and obsolete inventory , a portion of which is a result of our planned restructuring in brazil sales and marketing expense increased $ 3.2 million o increase in compensation and benefits costs , including commissions , as a result of the increase in net sales o partially offset by a reduction of certain indirect tax liabilities of $ 3.1 million in 2016 o also partially offset by a decrease in bad debt expense of $ 2.3 million related to puerto rico the following table presents non-gaap net margin by reporting segment . the reasons for the changes in non-gaap net margin by sbu are generally consistent with the information provided above for gross profit and sales and marketing expense . replace_table_token_7_th 37 general and administrative expense replace_table_token_8_th 2017 compared to 2016 general and administrative expense decreased less than $ 0.1 million decrease of $ 3.6 million from a reduction in project bluecore expenses , as the project was completed in 2016 decrease in share-based compensation expense of $ 3.5 million , largely driven by a net decrease in expense attributable to performance-based and market-based awards core expense reductions through savings in other professional fees of $ 2.0 million partially offset by an increase in spending of $ 5.7 million for evaluation of strategic investments further offset by an unfavorable change related to legal settlements of $ 3.5 million , largely as a result of a favorable commercial litigation settlement received in 2016 of $ 3.0 million 2016 compared to 2015 general and administrative expense decreased $ 12.8 million decreases in professional fees of $ 7.9 million , largely associated with the completion in 2016 of our internal control remediation efforts and project bluecore , a company-wide infrastructure initiative to improve the reliability and efficiency of our systems , processes , and reporting reduced legal costs of $ 6.9 million , largely due to legal settlements incurred in the prior year and a commercial legal settlement in 2016 whereby we received $ 3.0 million the moratorium on the medical device tax in 2016 , which decreased expense by $ 1.3 million reduction in other controllable expenses overall decrease was partially offset by increased share-based compensation expense of $ 8.1 million , including $ 5.7 million associated with the determination in 2016 that achieving the performance criteria related to certain of our performance-based vesting restricted stock awards is probable research story_separator_special_tag responded , to the proceeding , investigation or claim . our assessment of these factors may change over tim e as individual proceedings , investigations or claims progress . for matters where we are not currently able to reasonably estimate the range of reasonably possible loss , the factors that have contributed to this determination include the following : ( i ) the damages sought are indeterminate , or an investigation has not manifested itself in a filed civil or criminal complaint , ( ii ) the matters are in the early stages , ( iii ) the matters involve novel or unsettled legal theories or a large or uncertain number of actual or potential cases or parties , and or ( iv ) discussions with the government or other parties in matters that may be expected ultimately to be resolved through negotiation and settlement have not reached the point where we believe a reasonable estima te of loss , or range of loss , can be made . in such instances , we believe that there is considerable uncertainty regarding the timing or ultimate resolution of such matters , including a possible eventual loss , fine , penalty or business impact , if any . changes in the facts and circumstances associated with a claim could have a material impact on our results of operations and cash flows in the period that reserve estimates are revised . we believe our insurance coverage and reserves are sufficient to cover currently estimated exposures , but we can not give any assurance that we will not incur liabilities in excess of recorded reserves or our present insurance coverage . litigation and contingent liabilities are “ critical accounting estimates ” because changes in the assumptions used to develop the estimates could materially affect key financial measures , including operating income and net income . tax matters we and each of our subsidiaries are taxed at the rates applicable within each of their respective jurisdictions . our income tax expense , effective tax rate , deferred tax assets and deferred tax liabilities will vary according to the jurisdiction in which profits arise . further , certain of our subsidiaries sell products directly to our other subsidiaries or provide administrative , marketing and support services to our other subsidiaries . these intercompany sales and support services involve subsidiaries operating in jurisdictions with differing tax rates . the tax authorities in such jurisdictions may challenge our treatments under residency criteria , transfer pricing provisions , or other aspects of their respective tax laws , which could affect our composite tax rate and provisions . we sometimes engage in transactions in which tax consequences may be subject to uncertainty . we account for these uncertain tax positions in accordance with applicable accounting guidance , which requires significant judgment in assessing the estimated tax consequences of a transaction . we evaluate the tax position taken or expected to be taken in a tax return by determining if the weight of available evidence indicates that it is more likely than not that , on an evaluation of the technical merits , the tax position will be sustained on audit , including resolution of any related appeals or litigation processes . we measure the tax benefit as the largest amount that is more than 50 % likely to be realized upon ultimate settlement . we re-evaluate our income tax positions periodically to consider factors such as changes in facts or circumstances , changes in or interpretations of tax law , effectively settled issues under audit and new audit activity . such a change in recognition or measurement would result in recognition of a tax benefit or an additional charge to the tax provision . we establish a valuation allowance when measuring deferred tax assets if it is more likely than not that certain deferred tax assets will not be realized in the foreseeable future . this process requires significant judgment as we must project the current tax liability and estimate the deferred tax assets and liabilities into future periods , including net operating loss and tax credit carry forwards . in assessing the need for a valuation allowance , we consider recent operating results , availability of taxable income in carryback years , future reversals of taxable temporary differences , future taxable income projections ( exclusive of reversing temporary differences ) and all prudent and feasible tax planning strategies . on december 22 , 2017 , staff accounting bulletin no . 118 ( “ sab 118 ” ) was issued to address the application of u.s. gaap in situations when a registrant does not have the necessary information available , prepared , or analyzed ( including computations ) in reasonable detail to complete the accounting for certain income tax effects of the tax act . in accordance with sab 118 , we have determine that the $ 8.6 million of the deferred tax expense recorded in connection with the remeasurement of certain deferred tax assets and liabilities and the zero transition tax on the mandatory deemed repatriation of foreign earnings was a provisional amount and a reasonable estimate at december 31 , 2017. additional work is necessary for a more detailed analysis of our deferred tax assets and liabilities and our historical foreign earnings as well as potential correlative adjustments . any subsequent adjustment to those amounts will be recorded to current tax expense in the quarter of 2018 when the analysis is complete . 45 tax matters are “ critical accounting estimates ” because changes in the assumptions used to develop the estimates could materially affect key financial measures , including net income . share-based compensation determining the appropriate fair value model and calculating the fair value of employee stock awards requires estimates and judgments . our share-based compensation is a “ critical accounting estimate ” because changes in the assumptions used to develop estimates of fair value or the requisite service period could materially affect key financial measures

