if the implied fair value of goodwill is lower than the carrying value of goodwill an impairment is recognized ( identified as `` step 2 `` ) . the new standard story_separator_special_tag . the following discussion presents information about our consolidated results of operations , financial condition , liquidity and capital resources and should be read in conjunction with our consolidated financial statements and the notes thereto beginning on page f-1 of this annual report . overview we are engaged in the business of providing it and related consulting services , including cybersecurity , and it security consulting services and managed print services to the healthcare industry . our business is operated throughout the united states . we provide a large selection of testing services offered on a standalone basis or customized into a package of services to fit our customers ' needs or offered as an industry accepted methodology-based risk assessment that meets requirements outlined by hipaa and meaningful use . the hipaa risk assessment is our flagship stand-alone service and combines several of our individual technical and physical assessment components into a single engagement aimed specifically at addressing the requirement for both a risk assessment as well as ongoing risk management processes for all organizations with a requirement to comply with hipaa . we also offer an annual risk assessment as the base component of an ongoing holistic compliance management program , compliance assist partner program ( capp ) . 14 we understand that health information privacy means more than just meeting an organization 's hipaa compliance requirements – it is a business imperative . our team of consultants is comprised of experienced professionals who have learned their craft both in the classroom and through years of experience as policy makers and in the health care industry . this allows us to provide our customers with expert hipaa privacy consulting services that evaluate the rigor and effectiveness of their privacy program to ensure the confidentiality of their patients ' health information . we offer a menu of services to measure and strengthen an organization 's compliance with the hipaa privacy rule , hitech breach notification rule , federal trade commission consumer protection guidelines and state privacy standards . using state of the art assessment tools and applying industry best practices , our teams identify areas to strengthen our customers privacy program , recommend solutions , and provide tools and training materials to enhance the culture of privacy and compliance within your organization . a variety of consulting advisory services are also offered , ranging from using cutting-edge technologies to monitor user access to patient health information to producing exercises replicating the hipaa/hitech audit experience that help guide organizations on how to respond to state or federal regulatory enforcement investigations . we can also customize any assessment to address specific organizational requirements . working with us enables customers to have resources and expertise that they need to accelerate the effectiveness of their privacy program . to help organizations prepare for audits and investigations , cynergistek offers a series of audit solutions that help organizations verify and validate that privacy and security programs meet compliance and business objectives . cynergistek understands the regulatory and compliance environment and can help organizations enhance their risk management efforts through various types of audits . our compliance and audit services are delivered by our industry experts and provide an overall assessment of your organization 's audit readiness . we provide a compliance assist partner program ( “ capp ” ) that is a fully customizable managed security services support agreement . the capp is offered to both providers and business associates and provides the basic building blocks to help an organization build and maintain their cybersecurity program . this multi-year program provides a fully managed support environment . we offer a patient privacy monitoring service ( “ ppms ” ) that supports multiple platforms allowing the customer to select the tool of choice and have a fully managed solution . our vendor security management service is a fully automated saas solution employing our proprietary risk sonar application . our program provides a cloud-based solution with a client portal that enables cynergistek to conduct security reviews of the customers third-party supply chain vendors and provide the results back to the customer . our incident response service provides a proactive approach to assess , define , and prepare for a variety of cyber incidents . our program ensures an organization has the right technologies , people and processes in place to respond to an incident in an efficient and effective manner . the services will help improve your organization 's ability to respond and recover from a cyber incident ranging from an attack or breach , to a system outage . we offer them as one-time engagements or as a part of a bundled , ongoing incident response managed service . we have been an industry leader in document solutions for the healthcare industry for many years , offering hospitals and health systems comprehensive services and solutions to support the document life cycle . we provide a vendor neutral program that enhances security of printed , stored data and digital documents while driving out costs and inefficiencies within the patient information logistical chain . application of critical accounting policies the sec defines critical accounting policies as those that are , in management 's view , most important to the portrayal of our financial condition and results of operations and most demanding of our judgment . story_separator_special_tag income taxes deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial reporting requirements and those imposed under federal and state tax laws . deferred taxes are provided for timing differences in the recognition of revenue and expenses for income tax and financial reporting purposes and are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled . the effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date . deferred income tax expense represents the change during the period in the deferred tax assets and liabilities . realization of the deferred tax asset is dependent on generating sufficient taxable income in future years . deferred tax assets are reduced by a valuation allowance when , in the opinion of management , it is more likely than not that some portion or all the deferred tax assets will not be realized . use of our net operating loss deferred assets may be limited by changes in our ownership . the above listing is not intended to be a comprehensive list of all of our accounting policies . in many cases , the accounting treatment of a particular transaction is specifically dictated by gaap , with no need for management 's judgment in its application . there are also areas in which management 's judgment in selecting any available alternative would not produce a materially different result . please see our audited financial statements and notes thereto which begin on page f-1 of this annual report on form 10-k , which contain accounting policies and other disclosures required by gaap and please refer to the disclosures in note 1 of our financial statements for a summary of our significant accounting policies . 18 results of operations year ended december 31 , 2017 compared to the year ended december 31 , 2016 net revenue revenue increased by approximately $ 11,400,000 to $ 71,638,947 for the year ended december 31 , 2017 , as compared to the same period in 2016. this increase is largely attributable to the growth in our cybersecurity professional services as a result of the acquisition of ctek security , inc. ( formerly cynergistek , inc. ) ( “ ctek security ” ) in january 2017. revenues from these services increased by approximately $ 14,300,000. revenues from document solution services were approximately $ 49,100,000 in 2017 compared to $ 53,400,000 in 2016. the reduction in these revenues is a result of terminations as well as volume and negotiated rate reductions at existing customers , offset by new customers and expansion of services at existing customers . these terminations will result in lower managed document services revenue in the next few quarters until we replace this revenue with new customers . equipment sales for 2017 were approximately $ 5,000,000 as compared to approximately $ 3,600,000 in 2016. equipment revenues are primarily from copier fleet refresh activities at customers . these fleet refreshes are sporadic since they are typically done every five years at any one customer facility . cost of revenues cost of revenue consists of salaries and expenses of direct labor and indirect support staff as well as document imaging equipment , parts and supplies . cost of revenue was $ 50,739,359 for the year ended december 31 , 2017 , as compared to $ 47,888,296 for the same period in 2016. we incurred approximately $ 5,200,000 in additional staffing costs , including contract labor , largely as a result of the acquisition of ctek security . our service and supply costs decreased approximately $ 3,900,000 as a result of the reduction in document solution services revenue and lower toner supply pricing obtained . also , equipment costs increased by approximately $ 1,500,000 in 2017 , primarily as a result of the increase in equipment revenues from the copier fleet refresh activities . gross margin increased to 29 % of revenue for the year ended december 31 , 2017 as compared to 20 % for the same period in 2016. the increase is attributable to higher gross margins attained from professional services rendered though ctek security and the benefit from the maturation of a couple of large managed document services accounts . over the next few quarters we expect gross margins to decline due to the recent turnover we experienced in managed document services with partial offset from new customers as we grow professional services . sales and marketing sales and marketing expenses include salaries , commissions and expenses for sales and marketing personnel , travel and entertainment , and other selling and marketing costs . sales and marketing expenses were $ 5,747,758 for the year ended december 31 , 2017 , as compared to $ 2,723,735 for the same period in 2016. the increase is primarily attributable to the addition of the ctek security sales and marketing teams . also in 2017 , we incurred a nonrecurring charge of approximately $ 100,000 in severance pay for a terminated sales executive related to the integration of ctek security . general and administrative general and administrative expenses include personnel costs for finance , administration , information systems , and general management , as well as facilities expenses , professional fees , legal expenses and other administrative costs . general and administrative expenses increased by $ 1,488,403 to $ 7,662,486 for the year ended december 31 , 2017 , as compared to $ 6,174,083 for the same period in 2016. the increase in general and administrative expenses is attributed to 1 ) approximately $ 1,300,000 increase in staffing , travel , rent , insurance and office expenses as a result of the acquisition of ctek security ; 2 ) approximately $ 100,000 paid to the nyse mkt ( now nyse american ) to uplist in february 2017 ; and 3 ) a

liquidity and capital resources at december 31 , 2017 , our cash and cash equivalents were $ 4,252,060 and our working capital deficit was $ 1,034,028. our principal cash requirements were for operating expenses , including equipment , supplies , employee costs , principal and interest payments on term loans and promissory notes , and capital expenditures . our primary sources of cash were from service and equipment sale revenues , as well as from our bank facilities and other financing activities . during the year ended december 31 , 2017 , cash provided by operating activities was $ 1,433,713 as compared to cash provided by operating activities of $ 417,626 for the same period in 2016. our cash provided from operating activities in 2017 was higher than in 2016 primarily as a result of the increase in profitability from cybersecurity consulting services with the acquisition of ctek security , inc. in 2017. this is partially offset by an increase in interest payments made on the bank term loan and seller notes we entered into in connection with the acquisition of ctek security . 20 in january 2017 , we borrowed $ 14,000,000 under a five-year term loan agreement with a financial institution where we also have in place the availability of a $ 5,000,000 line of credit , subject to borrowing base limits . the term loan was used to finance the acquisition of ctek security .


 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 , 2017 , our cash and cash equivalents were $ 4,252,060 and our working capital deficit was $ 1,034,028. our principal cash requirements were for operating expenses , including equipment , supplies , employee costs , principal and interest payments on term loans and promissory notes , and capital expenditures . our primary sources of cash were from service and equipment sale revenues , as well as from our bank facilities and other financing activities . during the year ended december 31 , 2017 , cash provided by operating activities was $ 1,433,713 as compared to cash provided by operating activities of $ 417,626 for the same period in 2016. our cash provided from operating activities in 2017 was higher than in 2016 primarily as a result of the increase in profitability from cybersecurity consulting services with the acquisition of ctek security , inc. in 2017. this is partially offset by an increase in interest payments made on the bank term loan and seller notes we entered into in connection with the acquisition of ctek security . 20 in january 2017 , we borrowed $ 14,000,000 under a five-year term loan agreement with a financial institution where we also have in place the availability of a $ 5,000,000 line of credit , subject to borrowing base limits . the term loan was used to finance the acquisition of ctek security .
```    
 Suspicious Activity Report : if the implied fair value of goodwill is lower than the carrying value of goodwill an impairment is recognized ( identified as `` step 2 `` ) . the new standard story_separator_special_tag . the following discussion presents information about our consolidated results of operations , financial condition , liquidity and capital resources and should be read in conjunction with our consolidated financial statements and the notes thereto beginning on page f-1 of this annual report . overview we are engaged in the business of providing it and related consulting services , including cybersecurity , and it security consulting services and managed print services to the healthcare industry . our business is operated throughout the united states . we provide a large selection of testing services offered on a standalone basis or customized into a package of services to fit our customers ' needs or offered as an industry accepted methodology-based risk assessment that meets requirements outlined by hipaa and meaningful use . the hipaa risk assessment is our flagship stand-alone service and combines several of our individual technical and physical assessment components into a single engagement aimed specifically at addressing the requirement for both a risk assessment as well as ongoing risk management processes for all organizations with a requirement to comply with hipaa . we also offer an annual risk assessment as the base component of an ongoing holistic compliance management program , compliance assist partner program ( capp ) . 14 we understand that health information privacy means more than just meeting an organization 's hipaa compliance requirements – it is a business imperative . our team of consultants is comprised of experienced professionals who have learned their craft both in the classroom and through years of experience as policy makers and in the health care industry . this allows us to provide our customers with expert hipaa privacy consulting services that evaluate the rigor and effectiveness of their privacy program to ensure the confidentiality of their patients ' health information . we offer a menu of services to measure and strengthen an organization 's compliance with the hipaa privacy rule , hitech breach notification rule , federal trade commission consumer protection guidelines and state privacy standards . using state of the art assessment tools and applying industry best practices , our teams identify areas to strengthen our customers privacy program , recommend solutions , and provide tools and training materials to enhance the culture of privacy and compliance within your organization . a variety of consulting advisory services are also offered , ranging from using cutting-edge technologies to monitor user access to patient health information to producing exercises replicating the hipaa/hitech audit experience that help guide organizations on how to respond to state or federal regulatory enforcement investigations . we can also customize any assessment to address specific organizational requirements . working with us enables customers to have resources and expertise that they need to accelerate the effectiveness of their privacy program . to help organizations prepare for audits and investigations , cynergistek offers a series of audit solutions that help organizations verify and validate that privacy and security programs meet compliance and business objectives . cynergistek understands the regulatory and compliance environment and can help organizations enhance their risk management efforts through various types of audits . our compliance and audit services are delivered by our industry experts and provide an overall assessment of your organization 's audit readiness . we provide a compliance assist partner program ( “ capp ” ) that is a fully customizable managed security services support agreement . the capp is offered to both providers and business associates and provides the basic building blocks to help an organization build and maintain their cybersecurity program . this multi-year program provides a fully managed support environment . we offer a patient privacy monitoring service ( “ ppms ” ) that supports multiple platforms allowing the customer to select the tool of choice and have a fully managed solution . our vendor security management service is a fully automated saas solution employing our proprietary risk sonar application . our program provides a cloud-based solution with a client portal that enables cynergistek to conduct security reviews of the customers third-party supply chain vendors and provide the results back to the customer . our incident response service provides a proactive approach to assess , define , and prepare for a variety of cyber incidents . our program ensures an organization has the right technologies , people and processes in place to respond to an incident in an efficient and effective manner . the services will help improve your organization 's ability to respond and recover from a cyber incident ranging from an attack or breach , to a system outage . we offer them as one-time engagements or as a part of a bundled , ongoing incident response managed service . we have been an industry leader in document solutions for the healthcare industry for many years , offering hospitals and health systems comprehensive services and solutions to support the document life cycle . we provide a vendor neutral program that enhances security of printed , stored data and digital documents while driving out costs and inefficiencies within the patient information logistical chain . application of critical accounting policies the sec defines critical accounting policies as those that are , in management 's view , most important to the portrayal of our financial condition and results of operations and most demanding of our judgment . story_separator_special_tag income taxes deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial reporting requirements and those imposed under federal and state tax laws . deferred taxes are provided for timing differences in the recognition of revenue and expenses for income tax and financial reporting purposes and are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled . the effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date . deferred income tax expense represents the change during the period in the deferred tax assets and liabilities . realization of the deferred tax asset is dependent on generating sufficient taxable income in future years . deferred tax assets are reduced by a valuation allowance when , in the opinion of management , it is more likely than not that some portion or all the deferred tax assets will not be realized . use of our net operating loss deferred assets may be limited by changes in our ownership . the above listing is not intended to be a comprehensive list of all of our accounting policies . in many cases , the accounting treatment of a particular transaction is specifically dictated by gaap , with no need for management 's judgment in its application . there are also areas in which management 's judgment in selecting any available alternative would not produce a materially different result . please see our audited financial statements and notes thereto which begin on page f-1 of this annual report on form 10-k , which contain accounting policies and other disclosures required by gaap and please refer to the disclosures in note 1 of our financial statements for a summary of our significant accounting policies . 18 results of operations year ended december 31 , 2017 compared to the year ended december 31 , 2016 net revenue revenue increased by approximately $ 11,400,000 to $ 71,638,947 for the year ended december 31 , 2017 , as compared to the same period in 2016. this increase is largely attributable to the growth in our cybersecurity professional services as a result of the acquisition of ctek security , inc. ( formerly cynergistek , inc. ) ( “ ctek security ” ) in january 2017. revenues from these services increased by approximately $ 14,300,000. revenues from document solution services were approximately $ 49,100,000 in 2017 compared to $ 53,400,000 in 2016. the reduction in these revenues is a result of terminations as well as volume and negotiated rate reductions at existing customers , offset by new customers and expansion of services at existing customers . these terminations will result in lower managed document services revenue in the next few quarters until we replace this revenue with new customers . equipment sales for 2017 were approximately $ 5,000,000 as compared to approximately $ 3,600,000 in 2016. equipment revenues are primarily from copier fleet refresh activities at customers . these fleet refreshes are sporadic since they are typically done every five years at any one customer facility . cost of revenues cost of revenue consists of salaries and expenses of direct labor and indirect support staff as well as document imaging equipment , parts and supplies . cost of revenue was $ 50,739,359 for the year ended december 31 , 2017 , as compared to $ 47,888,296 for the same period in 2016. we incurred approximately $ 5,200,000 in additional staffing costs , including contract labor , largely as a result of the acquisition of ctek security . our service and supply costs decreased approximately $ 3,900,000 as a result of the reduction in document solution services revenue and lower toner supply pricing obtained . also , equipment costs increased by approximately $ 1,500,000 in 2017 , primarily as a result of the increase in equipment revenues from the copier fleet refresh activities . gross margin increased to 29 % of revenue for the year ended december 31 , 2017 as compared to 20 % for the same period in 2016. the increase is attributable to higher gross margins attained from professional services rendered though ctek security and the benefit from the maturation of a couple of large managed document services accounts . over the next few quarters we expect gross margins to decline due to the recent turnover we experienced in managed document services with partial offset from new customers as we grow professional services . sales and marketing sales and marketing expenses include salaries , commissions and expenses for sales and marketing personnel , travel and entertainment , and other selling and marketing costs . sales and marketing expenses were $ 5,747,758 for the year ended december 31 , 2017 , as compared to $ 2,723,735 for the same period in 2016. the increase is primarily attributable to the addition of the ctek security sales and marketing teams . also in 2017 , we incurred a nonrecurring charge of approximately $ 100,000 in severance pay for a terminated sales executive related to the integration of ctek security . general and administrative general and administrative expenses include personnel costs for finance , administration , information systems , and general management , as well as facilities expenses , professional fees , legal expenses and other administrative costs . general and administrative expenses increased by $ 1,488,403 to $ 7,662,486 for the year ended december 31 , 2017 , as compared to $ 6,174,083 for the same period in 2016. the increase in general and administrative expenses is attributed to 1 ) approximately $ 1,300,000 increase in staffing , travel , rent , insurance and office expenses as a result of the acquisition of ctek security ; 2 ) approximately $ 100,000 paid to the nyse mkt ( now nyse american ) to uplist in february 2017 ; and 3 ) a

