Note 3. Accounts Receivable – Project Revenue and Project Costs

ENEC and FANR Projects

The total accounts receivable from the ENEC and FANR contracts was approximately $0.9 million and $0.3 million at March 31, 2012 and December 31, 2011, respectively. These amounts represent approximately 100 percent and 99 percent of the total accounts receivable reported of approximately $0.9 million and $0.3 million at March 31, 2012 and December 31, 2011, respectively.

Total unbilled accounts receivable included in the accompanying consolidated balance sheets and reported in accounts receivable of approximately $0.4 and $0.2 million at March 31, 2012 and December 31, 2011, respectively, is for work that was billed to our clients in April 2012 and January 2012, respectively. Foreign currency transaction exchange gains (losses) were approximately $6,000 and $(3,000) for the three months ended March 31, 2012 and 2011, respectively, which is reported in the caption other income and expenses on the accompanying consolidated statement of operations. Translation gains and losses for the three months ended March 31, 2012 and 2011 were not significant.

Travel costs and other reimbursable costs under these contracts are reported in the accompanying statement of operations as both revenue and cost of consulting services provided, and totaled approximately $0.1 million for the three months ended March 31, 2012 and 2011. The total travel and other reimbursable expenses that have not been reimbursed to us and are included in total accounts receivable reported above from our consulting contracts were approximately $0.1 million at March 31, 2012 and December 31, 2011.

We expect to continue to provide strategic advisory services to Abu Dhabi during the five-year term of these consulting agreements, with the agreements providing for automatic renewals for one year periods, and also expect the variation of revenue we earn from these contracts to continue. Under these agreements, revenue will be recognized on a time and expense basis. We periodically discuss our consulting work with ENEC and FANR, who will review the work we perform, and our reimbursable travel expenses, and accept our monthly invoicing for services and reimbursable expenses.