NOTE 1  BASIS OF PRESENTATION The accompanying condensed consolidated financial statements include the accounts and operations of USA Truck Inc., and present our financial position as of March 31, 2020 and December 31, 2019 and the results of our operations, comprehensive (loss) income and cash flows for the three months ended March 31, 2020 and 2019. These condensed consolidated financial statements and notes are prepared pursuant to the rules and regulations of the Securities and Exchange Commission for interim reporting and do not include all of the information normally included with financial statements prepared in accordance with generally accepted accounting principles (GAAP) of the United States. Additionally, the Company has elected to utilize certain abbreviated reporting requirements available to smaller reporting companies. These financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2019. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements and accompanying notes. Actual results could differ from those estimates. These condensed consolidated financial statements and notes are unaudited. However, in the opinion of management, these condensed consolidated financial statements reflect all normal recurring adjustments necessary for a fair presentation of the results for the periods presented. Results for interim periods are not necessarily indicative of results to be expected for the full year ending December 31, 2020. The accompanying condensed consolidated financial statements include USA Truck Inc., and its wholly owned subsidiaries: International Freight Services, Inc. (IFS), a Delaware corporation; Davis Transfer Company Inc. (DTC), a Georgia corporation, Davis Transfer Logistics Inc. (DTL), a Georgia corporation, and B &amp; G Leasing, L.L.C. (B &amp; G), a Georgia limited liability company. Collectively, B &amp; G, DTC, and DTL comprise Davis Transfer Company. References in this report to it, we, us, our, or the Company, and similar expressions refer to USA Truck Inc. and its subsidiaries. All significant intercompany balances and transactions have been eliminated in preparing the condensed consolidated financial statements. Certain amounts reported in prior periods have been reclassified to conform to the current year presentation. Change in estimate The Company reviews the estimated useful lives and salvage values of its fixed assets on an ongoing basis, based upon, among other things, our experience with similar assets, conditions in the used revenue equipment market, and prevailing industry practice. During the first quarter of 2020, the Company lowered the salvage value of its tractor fleet from 30% to 25% to better reflect current estimates of the value of such equipment upon its retirement. This change is being accounted for as a change in estimate. During the quarter ended March 31, 2020, this change in estimate resulted in an increase in depreciation and amortization expense of approximately $0.4 million. Risks and Uncertainties In March 2020, the World Health Organization declared the novel strain of coronavirus (COVID-19) a global pandemic, and the President of the United States declared the COVID-19 outbreak a national emergency. The rapid spread of the pandemic and the continuously evolving responses to combat it have had an increasingly negative impact on the global economy. In view of the rapidly changing business environment, unprecedented market volatility and heightened degree of uncertainty resulting from COVID-19, we are currently unable to fully determine its future impact on our business. However, we are monitoring the progression of the pandemic, further government response and development of treatments and vaccines and their potential effect on our financial position, results of operations, cash flows and liquidity. These events could have an impact in future periods on certain estimates used in the preparation of our first quarter financial results, including, but not limited to impairment of goodwill, other intangible assets and other long-lived assets, income tax provision and recoverability of certain receivables. Should the pandemic continue for an extended period of time, the impact on our operations could have a material adverse effect on our financial condition, results of operations, cash flows and liquidity. Accounting standards issued but not yet adopted In June 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (ASU 2016-13). This update requires measurement and recognition of expected versus incurred credit losses for financial assets held. For smaller reporting companies, ASU 2016-13 is effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. We are currently evaluating the effect of adopting ASU 2016-13.