the wholesale finished jewelry business that we launched in 2010 is currently expanding through select retailers and television shopping networks . we believe there is significant opportunity to further expand our wholesale finished jewelry business through e-commerce , television shopping , and other retailers . we also believe our finished jewelry business , including finished jewelry sold through our direct-to-consumer e-commerce and home party sales channels , allows us to have more control over the end product and enhance our relationships with consumers , as well as provide incremental sales and gross profit dollars due to the higher price points of finished jewelry containing moissanite relative to loose jewels . to that end , we focused on the following critical aspects of our strategic plan during 2013 : · developing brand strategies - our goal is to build multiple strong brands around the moissanite jewel and finished jewelry collections in attractive and desirable jewelry designs , especially those featuring larger center stones that leverage moissanite 's point of differentiation and value proposition . we believe branding will allow us to increase consumer awareness , which we expect to help drive sales and develop consumer brand recognition and loyalty . in june 2012 , we launched a moissanite jewel with optical properties that are significantly whiter than our standard vg “ classic moissanite ” grade jewels . we are marketing these whiter jewels under the forever brilliant ® trademark as a premier brand to differentiate from other grades of our moissanite as well as moissanite sold by potential competitors in the future . we expect demand for our forever brilliant ® loose jewel and finished jewelry featuring the forever brilliant ® jewel to grow , both in our wholesale channel and on our moissanite.com e-commerce website , and that forever brilliant ® will become an increasingly important brand for charles & colvard , ltd. as we execute future branding initiatives . we are also exploring additional product lines and branding strategies that will differentiate our products in the market . 20 in october 2012 , we partnered with a well-known designer to custom design and source finished fashion and moissanite jewelry and provide branding direction for lulu avenue ® , the home party direct sales brand of charles & colvard direct . we believe our exclusive fashion and moissanite jewelry designs serve as the point of differentiation that positions lulu avenue ® ahead of other jewelry home party direct sales companies and will excite both consumers and women searching for unique business ownership opportunities . in june 2013 , we engaged cindy riccio communications , inc. , or crc , a new york-based public relations , marketing , and events agency , as our agency of record to generate optimal exposure with consumer media for both our lulu avenue ® and forever brilliant ® brands , with the goal to increase consumer awareness of our brands specifically and moissanite generally . several media events occurred during 2013 where magazine editors , fashion columnists , and bloggers were invited to experience first-hand our lulu avenue ® fashion and moissanite finished jewelry and our forever brilliant ® loose jewels . we are also utlizing crc to increase exposure for our brands through improved product placement in leading fashion periodicals and blogging sites , and through broadcast and print editorial outreach . we believe our efforts to position forever brilliant ® as the whitest and brightest moissanite jewel available anywhere in the world , the introduction of designer finished jewelry brands , and the engagement of a branding public relations agency will help us to build brand recognition and increase consumer awareness of our products . we also expect that this strategy of building brand recognition will help to support revenue streams as our intellectual property rights expire in the future . · expanding our direct-to-consumer e-commerce business - our direct-to-consumer e-commerce website , moissanite.com , features an intuitive site design with robust functionality to enhance the customer experience and convert traffic into sales . we continue to expand the website 's jewelry collections and its loose moissanite jewel assortment by featuring a variety of colors and shapes , and we are investing resources in targeted advertising and marketing campaigns . in 2013 , we continued fine-tuning such marketing efforts to maximize return on investment , increasing product assortment , and building new site functionality designed to increase sales conversion rates . we believe our direct-to-consumer e-commerce sales channel will not only add to our top-line revenues in a significant manner , but will also play a key role in our campaign to increase overall consumer awareness of moissanite . we also envision e-commerce as a part of a broader effort to establish online connections with consumers that build our brands and our business with retail partners . · developing our direct-to-consumer home party business - in october 2012 , our direct-to-consumer home party business , lulu avenue ® , began to integrate the custom designs of a well-known jewelry designer into the current jewelry line . the first phase of the integration was completed in march 2013. in april 2013 , we hired a president of lulu avenue ® whose focus is on the scale-up of the sales force , and in march 2013 , we hired a director of finance and administration , who leads the back office technology and supply chain efforts of lulu avenue ® . with these new key personnel , we completed the final phase of the integration process in 2013. we believe our direct-to-consumer home party sales channel will provide future sales growth and play a role in our campaign to increase overall consumer awareness of moissanite . story_separator_special_tag ” based on our tax losses in tax years prior to 2012 and the lack of verifiable positive evidence of sufficient future taxable income to fully use our net operating loss carryforward and other deferred tax assets , we established valuation allowances against all u.s. deferred tax assets of $ 4.43 million as of december 31 , 2011. as of each reporting date , management considers new evidence , both positive and negative , that could impact its view with regard to future realization of deferred tax assets . for the years ended december 31 , 2013 and 2012 , cumulative positive taxable income over the last three years had been generated , offsetting the negative evidence of cumulative losses in previous years . we also determined that our expectations of future taxable income in upcoming tax years would be sufficient to result in full utilization of these net operating loss carryforwards and deferred tax assets prior to any statutory expiration . as a result , management determined that sufficient positive evidence exist as of december 31 , 2013 and 2012 to conclude that it is more likely than not deferred tax assets of $ 4.04 million and $ 3.73 million , respectively , are realizable , and we reduced our valuation allowance accordingly . the reduction of the valuation allowances against these deferred tax assets resulted in an income tax benefit during the years ended december 31 , 2013 and 2012 of $ 1,000 and $ 3.73 million , respectively . a valuation allowance remained at december 31 , 2013 and 2012 against certain deferred tax assets relating to state net operating loss carryforwards from our e-commerce and home party operating subsidiaries due to the timing uncertainty of when the subsidiaries will generate cumulative positive taxable income to utilize the associated deferred tax assets . a valuation allowance also remained at december 31 , 2013 and 2012 against certain deferred tax assets relating to investment loss carryforwards because our current investments were classified as held-to-maturity as of december 31 , 2012 , indicating they would be redeemed at par value , and they did not generate gains sufficient to utilize the associated deferred tax assets when they matured in 2013. our deferred tax assets in hong kong were fully reserved with a valuation allowance of $ 996,000 as of december 31 , 2013 and 2012 and had been fully reserved in all prior periods due to the uncertainty of future taxable income in this jurisdiction to utilize the deferred tax assets . our hong kong subsidiary ceased operations during 2008 and became a dormant entity during 2009. if we use any portion of our deferred tax assets in future periods , the valuation allowance would need to be reversed and may impact our future operating results . uncertain tax positions - effective january 1 , 2007 , we adopted u.s. gaap guidance regarding the de-recognition , classification , accounting in interim periods , and disclosure requirements for uncertain tax positions . determining which tax positions qualify as uncertain positions and the subsequent accounting for these positions requires significant estimates and assumptions . our net accrued income tax liability under the provisions of this guidance was $ 395,000 and $ 384,000 at december 31 , 2013 and 2012 , respectively . this liability is only resolved when we obtain an official ruling from the tax authority on the positions or when the statute of limitations expires . our liability increased by $ 11,000 for accrued interest on these positions . cooperative advertising - we offer a cooperative advertising program to many of our wholesale customers that reimburses , via a credit towards future purchases , a portion of their marketing costs based on their net purchases from us . at the end of any given period , we estimate the amount of cooperative advertising expense that has not yet been submitted for credit by our customers . these amounts were $ 188,000 and $ 200,000 at december 31 , 2013 and 2012 , respectively . we estimate this amount based on our historical experience with each customer and the related contractual arrangements to provide certain levels of cooperative advertising for our customers . any differences in actual amounts to our estimates will result in a charge or credit to sales and marketing expenses . revenue recognition - revenue is recognized when title transfers at the time of shipment from our or a third-party fulfillment company 's facility , excluding consignment shipments as discussed below ; evidence of an arrangement exists ; pricing is fixed and determinable ; and collectability is reasonably assured . our standard wholesale customer payment terms are generally between 30 and 90 days , though we may offer extended terms with specific customers and on significant orders from time to time . some wholesale customers and all direct-to-consumer customers are required to prepay prior to shipment . at the time revenue is recognized , an allowance for estimated returns is established . any change in the allowance for returns is charged against net sales . our return policy allows for the return of loose jewels and finished jewelry for credit generally within 30 days of shipment and must be returned for a valid reason , such as quality problems or an error in shipment . from time to time , some wholesale customers may have a contractual right to return a certain percentage of goods for any reason for specified periods of time . in these instances , we only recognize revenue when the contractual right of return is exhausted . periodically , we ship finished goods inventory to wholesale customers on consignment terms . under these terms , the customer assumes the risk of loss and has an absolute right of return for a specified period that typically ranges from six months to one year . our wholesale customers are generally required to make payments on consignment shipments within 60 days upon the customer informing us

liquidity and capital resources we require cash to fund our operating expenses and working capital requirements , including outlays for capital expenditures . as of december 31 , 2013 , our principal sources of liquidity were cash and cash equivalents totaling $ 2.57 million , trade accounts receivable of $ 10.24 million , and short-term inventory of $ 13.07 million , as compared to cash and cash equivalents totaling $ 11.86 million , trade accounts receivable of $ 8.14 million , and short-term inventory of $ 8.44 million as of december 31 , 2012. we had $ 500,000 of highly liquid u.s. government agency securities that matured during the year . as described more fully below , we also have access to the $ 10 million line of credit . during the year ended december 31 , 2013 , our working capital decreased by approximately $ 4.47 million to $ 23.54 million from $ 28.01 million at december 31 , 2012. as described more fully below , the decrease in working capital at december 31 , 2013 is primarily attributable to a decrease in cash and cash equivalents , a decrease in held-to-maturity investments , an increase in trade accounts payable , a net increase in accrued expenses and other liabilities , and a decrease in interest receivable , offset in part by an increase in trade accounts receivable , a greater allocation of inventory to short-term , and an increase in prepaid expenses and other assets . during the year ended december 31 , 2013 , $ 9.31 million of cash was used in operations .


 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 we require cash to fund our operating expenses and working capital requirements , including outlays for capital expenditures . as of december 31 , 2013 , our principal sources of liquidity were cash and cash equivalents totaling $ 2.57 million , trade accounts receivable of $ 10.24 million , and short-term inventory of $ 13.07 million , as compared to cash and cash equivalents totaling $ 11.86 million , trade accounts receivable of $ 8.14 million , and short-term inventory of $ 8.44 million as of december 31 , 2012. we had $ 500,000 of highly liquid u.s. government agency securities that matured during the year . as described more fully below , we also have access to the $ 10 million line of credit . during the year ended december 31 , 2013 , our working capital decreased by approximately $ 4.47 million to $ 23.54 million from $ 28.01 million at december 31 , 2012. as described more fully below , the decrease in working capital at december 31 , 2013 is primarily attributable to a decrease in cash and cash equivalents , a decrease in held-to-maturity investments , an increase in trade accounts payable , a net increase in accrued expenses and other liabilities , and a decrease in interest receivable , offset in part by an increase in trade accounts receivable , a greater allocation of inventory to short-term , and an increase in prepaid expenses and other assets . during the year ended december 31 , 2013 , $ 9.31 million of cash was used in operations .
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 Suspicious Activity Report : the wholesale finished jewelry business that we launched in 2010 is currently expanding through select retailers and television shopping networks . we believe there is significant opportunity to further expand our wholesale finished jewelry business through e-commerce , television shopping , and other retailers . we also believe our finished jewelry business , including finished jewelry sold through our direct-to-consumer e-commerce and home party sales channels , allows us to have more control over the end product and enhance our relationships with consumers , as well as provide incremental sales and gross profit dollars due to the higher price points of finished jewelry containing moissanite relative to loose jewels . to that end , we focused on the following critical aspects of our strategic plan during 2013 : · developing brand strategies - our goal is to build multiple strong brands around the moissanite jewel and finished jewelry collections in attractive and desirable jewelry designs , especially those featuring larger center stones that leverage moissanite 's point of differentiation and value proposition . we believe branding will allow us to increase consumer awareness , which we expect to help drive sales and develop consumer brand recognition and loyalty . in june 2012 , we launched a moissanite jewel with optical properties that are significantly whiter than our standard vg “ classic moissanite ” grade jewels . we are marketing these whiter jewels under the forever brilliant ® trademark as a premier brand to differentiate from other grades of our moissanite as well as moissanite sold by potential competitors in the future . we expect demand for our forever brilliant ® loose jewel and finished jewelry featuring the forever brilliant ® jewel to grow , both in our wholesale channel and on our moissanite.com e-commerce website , and that forever brilliant ® will become an increasingly important brand for charles & colvard , ltd. as we execute future branding initiatives . we are also exploring additional product lines and branding strategies that will differentiate our products in the market . 20 in october 2012 , we partnered with a well-known designer to custom design and source finished fashion and moissanite jewelry and provide branding direction for lulu avenue ® , the home party direct sales brand of charles & colvard direct . we believe our exclusive fashion and moissanite jewelry designs serve as the point of differentiation that positions lulu avenue ® ahead of other jewelry home party direct sales companies and will excite both consumers and women searching for unique business ownership opportunities . in june 2013 , we engaged cindy riccio communications , inc. , or crc , a new york-based public relations , marketing , and events agency , as our agency of record to generate optimal exposure with consumer media for both our lulu avenue ® and forever brilliant ® brands , with the goal to increase consumer awareness of our brands specifically and moissanite generally . several media events occurred during 2013 where magazine editors , fashion columnists , and bloggers were invited to experience first-hand our lulu avenue ® fashion and moissanite finished jewelry and our forever brilliant ® loose jewels . we are also utlizing crc to increase exposure for our brands through improved product placement in leading fashion periodicals and blogging sites , and through broadcast and print editorial outreach . we believe our efforts to position forever brilliant ® as the whitest and brightest moissanite jewel available anywhere in the world , the introduction of designer finished jewelry brands , and the engagement of a branding public relations agency will help us to build brand recognition and increase consumer awareness of our products . we also expect that this strategy of building brand recognition will help to support revenue streams as our intellectual property rights expire in the future . · expanding our direct-to-consumer e-commerce business - our direct-to-consumer e-commerce website , moissanite.com , features an intuitive site design with robust functionality to enhance the customer experience and convert traffic into sales . we continue to expand the website 's jewelry collections and its loose moissanite jewel assortment by featuring a variety of colors and shapes , and we are investing resources in targeted advertising and marketing campaigns . in 2013 , we continued fine-tuning such marketing efforts to maximize return on investment , increasing product assortment , and building new site functionality designed to increase sales conversion rates . we believe our direct-to-consumer e-commerce sales channel will not only add to our top-line revenues in a significant manner , but will also play a key role in our campaign to increase overall consumer awareness of moissanite . we also envision e-commerce as a part of a broader effort to establish online connections with consumers that build our brands and our business with retail partners . · developing our direct-to-consumer home party business - in october 2012 , our direct-to-consumer home party business , lulu avenue ® , began to integrate the custom designs of a well-known jewelry designer into the current jewelry line . the first phase of the integration was completed in march 2013. in april 2013 , we hired a president of lulu avenue ® whose focus is on the scale-up of the sales force , and in march 2013 , we hired a director of finance and administration , who leads the back office technology and supply chain efforts of lulu avenue ® . with these new key personnel , we completed the final phase of the integration process in 2013. we believe our direct-to-consumer home party sales channel will provide future sales growth and play a role in our campaign to increase overall consumer awareness of moissanite . story_separator_special_tag ” based on our tax losses in tax years prior to 2012 and the lack of verifiable positive evidence of sufficient future taxable income to fully use our net operating loss carryforward and other deferred tax assets , we established valuation allowances against all u.s. deferred tax assets of $ 4.43 million as of december 31 , 2011. as of each reporting date , management considers new evidence , both positive and negative , that could impact its view with regard to future realization of deferred tax assets . for the years ended december 31 , 2013 and 2012 , cumulative positive taxable income over the last three years had been generated , offsetting the negative evidence of cumulative losses in previous years . we also determined that our expectations of future taxable income in upcoming tax years would be sufficient to result in full utilization of these net operating loss carryforwards and deferred tax assets prior to any statutory expiration . as a result , management determined that sufficient positive evidence exist as of december 31 , 2013 and 2012 to conclude that it is more likely than not deferred tax assets of $ 4.04 million and $ 3.73 million , respectively , are realizable , and we reduced our valuation allowance accordingly . the reduction of the valuation allowances against these deferred tax assets resulted in an income tax benefit during the years ended december 31 , 2013 and 2012 of $ 1,000 and $ 3.73 million , respectively . a valuation allowance remained at december 31 , 2013 and 2012 against certain deferred tax assets relating to state net operating loss carryforwards from our e-commerce and home party operating subsidiaries due to the timing uncertainty of when the subsidiaries will generate cumulative positive taxable income to utilize the associated deferred tax assets . a valuation allowance also remained at december 31 , 2013 and 2012 against certain deferred tax assets relating to investment loss carryforwards because our current investments were classified as held-to-maturity as of december 31 , 2012 , indicating they would be redeemed at par value , and they did not generate gains sufficient to utilize the associated deferred tax assets when they matured in 2013. our deferred tax assets in hong kong were fully reserved with a valuation allowance of $ 996,000 as of december 31 , 2013 and 2012 and had been fully reserved in all prior periods due to the uncertainty of future taxable income in this jurisdiction to utilize the deferred tax assets . our hong kong subsidiary ceased operations during 2008 and became a dormant entity during 2009. if we use any portion of our deferred tax assets in future periods , the valuation allowance would need to be reversed and may impact our future operating results . uncertain tax positions - effective january 1 , 2007 , we adopted u.s. gaap guidance regarding the de-recognition , classification , accounting in interim periods , and disclosure requirements for uncertain tax positions . determining which tax positions qualify as uncertain positions and the subsequent accounting for these positions requires significant estimates and assumptions . our net accrued income tax liability under the provisions of this guidance was $ 395,000 and $ 384,000 at december 31 , 2013 and 2012 , respectively . this liability is only resolved when we obtain an official ruling from the tax authority on the positions or when the statute of limitations expires . our liability increased by $ 11,000 for accrued interest on these positions . cooperative advertising - we offer a cooperative advertising program to many of our wholesale customers that reimburses , via a credit towards future purchases , a portion of their marketing costs based on their net purchases from us . at the end of any given period , we estimate the amount of cooperative advertising expense that has not yet been submitted for credit by our customers . these amounts were $ 188,000 and $ 200,000 at december 31 , 2013 and 2012 , respectively . we estimate this amount based on our historical experience with each customer and the related contractual arrangements to provide certain levels of cooperative advertising for our customers . any differences in actual amounts to our estimates will result in a charge or credit to sales and marketing expenses . revenue recognition - revenue is recognized when title transfers at the time of shipment from our or a third-party fulfillment company 's facility , excluding consignment shipments as discussed below ; evidence of an arrangement exists ; pricing is fixed and determinable ; and collectability is reasonably assured . our standard wholesale customer payment terms are generally between 30 and 90 days , though we may offer extended terms with specific customers and on significant orders from time to time . some wholesale customers and all direct-to-consumer customers are required to prepay prior to shipment . at the time revenue is recognized , an allowance for estimated returns is established . any change in the allowance for returns is charged against net sales . our return policy allows for the return of loose jewels and finished jewelry for credit generally within 30 days of shipment and must be returned for a valid reason , such as quality problems or an error in shipment . from time to time , some wholesale customers may have a contractual right to return a certain percentage of goods for any reason for specified periods of time . in these instances , we only recognize revenue when the contractual right of return is exhausted . periodically , we ship finished goods inventory to wholesale customers on consignment terms . under these terms , the customer assumes the risk of loss and has an absolute right of return for a specified period that typically ranges from six months to one year . our wholesale customers are generally required to make payments on consignment shipments within 60 days upon the customer informing us

