Document and Entity Information - USD ($) $ in Millions	12 Months Ended
Document and Entity Information - USD ($) $ in Millions	Jan. 01, 2016	Mar. 15, 2016	Jul. 03, 2015
Document and Entity Information
Entity Registrant Name	Willdan Group, Inc.
Entity Central Index Key	0001370450
Document Type	10-K
Document Period End Date	Jan. 01, 2016
Amendment Flag	false
Current Fiscal Year End Date	--01-01
Entity Well-known Seasoned Issuer	No
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Filer Category	Accelerated Filer
Entity Public Float			$ 80.1
Entity Common Stock, Shares Outstanding		8,173,402
Document Fiscal Year Focus	2015
Document Fiscal Period Focus	FY

CONSOLIDATED BALANCE SHEETS - USD ($)	Jan. 01, 2016	Jan. 02, 2015
Current assets:
Cash and cash equivalents	$ 16,487,000	$ 18,173,000
Accounts receivable, net of allowance for doubtful accounts of $760,000 and $662,000 at January 1, 2016 and January 2, 2015, respectively	17,929,000	13,189,000
Costs and estimated earnings in excess of billings on uncompleted contracts	13,840,000	12,170,000
Other receivables	177,000	208,000
Prepaid expenses and other current assets	2,082,000	2,244,000
Total current assets	50,515,000	45,984,000
Equipment and leasehold improvements, net	3,684,000	1,384,000
Goodwill	16,097,000
Other intangible assets, net	1,545,000
Other assets	504,000	535,000
Deferred income taxes, net		1,427,000
Total assets	72,345,000	49,330,000
Current liabilities:
Accounts payable	5,561,000	3,237,000
Accrued liabilities	10,334,000	10,668,000
Contingent consideration payable	1,420,000
Billings in excess of costs and estimated earnings on uncompleted contracts	6,218,000	3,863,000
Notes payable	4,039,000	355,000
Capital lease obligations	444,000	324,000
Total current liabilities	28,016,000	18,447,000
Contingent consideration payable	4,305,000
Notes payable	1,085,000
Capital lease obligations	255,000	306,000
Deferred lease obligations	737,000	164,000
Deferred tax liability, non-current, net	331,000
Total liabilities	$ 34,729,000	$ 18,917,000
Commitments and contingencies
Stockholders' equity:
Preferred stock, $0.01 par value, 10,000,000 shares authorized, no shares issued and outstanding
Common stock, $0.01 par value, 40,000,000 shares authorized; 7,904,000 and 7,635,000 shares issued and outstanding at January 1, 2016 and January 2, 2015, respectively	$ 79,000	$ 76,000
Additional paid-in capital	38,377,000	35,436,000
Accumulated deficit	(840,000)	(5,099,000)
Total stockholders' equity	37,616,000	30,413,000
Total liabilities and stockholders' equity	$ 72,345,000	$ 49,330,000

CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($)	Jan. 01, 2016	Jan. 02, 2015
CONSOLIDATED BALANCE SHEETS
Accounts receivable, allowance for doubtful accounts (in dollars)	$ 760,000	$ 662,000
Preferred stock, par value (in dollars per share)	$ 0.01	$ 0.01
Preferred stock, shares authorized	10,000,000	10,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized	40,000,000	40,000,000
Common stock, shares issued	7,904,000	7,635,000
Common stock, shares outstanding	7,904,000	7,635,000

CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($)	12 Months Ended
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($)	Jan. 01, 2016	Jan. 02, 2015	Dec. 27, 2013
CONSOLIDATED STATEMENTS OF OPERATIONS
Contract revenue	$ 135,103,000	$ 108,080,000	$ 85,510,000
Direct costs of contract revenue (exclusive of depreciation and amortization shown separately below):
Salaries and wages	31,880,000	28,207,000	24,098,000
Subcontractor services and other direct costs	50,200,000	35,611,000	24,831,000
Total direct costs of contract revenue	82,080,000	63,818,000	48,929,000
General and administrative expenses:
Salaries and wages, payroll taxes and employee benefits	25,741,000	21,394,000	20,555,000
Facilities and facilities related	4,246,000	4,371,000	4,654,000
Stock-based compensation	777,000	258,000	150,000
Depreciation and amortization	2,072,000	459,000	517,000
Lease abandonment, net		9,000	30,000
Other	12,657,000	9,462,000	8,067,000
Total general and administrative expenses	45,493,000	35,953,000	33,973,000
Income from operations	7,530,000	8,309,000	2,608,000
Other (expense) income:
Interest income		8,000	10,000
Interest expense	(207,000)	(16,000)	(94,000)
Other, net	18,000	125,000	238,000
Total other (expense) income, net	(189,000)	117,000	154,000
Income before income taxes	7,341,000	8,426,000	2,762,000
Income tax expense (benefit)	3,082,000	(990,000)	132,000
Net income	$ 4,259,000	$ 9,416,000	$ 2,630,000
Earnings per share:
Basic	$ 0.54	$ 1.26	$ 0.36
Diluted	$ 0.52	$ 1.22	$ 0.35
Weighted-average shares outstanding:
Basic	7,834,000	7,488,000	7,355,000
Diluted	8,113,000	7,739,000	7,495,000

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($)	Common Stock	Additional Paid-in Capital	Accumulated Deficit	Total
Balances at Dec. 28, 2012	$ 73,000	$ 34,423,000	$ (17,145,000)	$ 17,351,000
Balances (in shares) at Dec. 28, 2012	7,335,000
Increase (Decrease) in Stockholders' Equity
Shares of common stock issued in connection with employee stock purchase plan	$ 1,000	72,000		73,000
Shares of common stock issued in connection with employee stock purchase plan (in shares)	31,000
Shares of common stock issued in connection with employee stock option exercise		9,000		9,000
Shares of common stock issued in connection with employee stock option exercise (in shares)	9,000
Stock-based compensation		150,000		150,000
Net income			2,630,000	2,630,000
Balances at Dec. 27, 2013	$ 74,000	34,654,000	(14,515,000)	20,213,000
Balances (in shares) at Dec. 27, 2013	7,375,000
Increase (Decrease) in Stockholders' Equity
Shares of common stock issued in connection with employee stock purchase plan		76,000		76,000
Shares of common stock issued in connection with employee stock purchase plan (in shares)	12,000
Shares of common stock issued in connection with employee stock option exercise	$ 2,000	448,000		450,000
Shares of common stock issued in connection with employee stock option exercise (in shares)	248,000
Stock-based compensation		258,000		258,000
Net income			9,416,000	9,416,000
Balances at Jan. 02, 2015	$ 76,000	35,436,000	(5,099,000)	$ 30,413,000
Balances (in shares) at Jan. 02, 2015	7,635,000			7,635,000
Increase (Decrease) in Stockholders' Equity
Shares of common stock issued in connection with employee stock purchase plan		170,000		$ 170,000
Shares of common stock issued in connection with employee stock purchase plan (in shares)	15,000
Shares of common stock issued in connection with employee stock option exercise	$ 1,000	511,000		512,000
Shares of common stock issued in connection with employee stock option exercise (in shares)	131,000
Stock issued to acquire businesses	$ 2,000	1,483,000		1,485,000
Stock issued to acquire businesses (in shares)	123,000
Stock-based compensation		777,000		777,000
Net income			4,259,000	4,259,000
Balances at Jan. 01, 2016	$ 79,000	$ 38,377,000	$ (840,000)	$ 37,616,000
Balances (in shares) at Jan. 01, 2016	7,904,000			7,904,000

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($)	12 Months Ended
	Jan. 01, 2016	Jan. 02, 2015	Dec. 27, 2013
Cash flows from operating activities:
Net income	$ 4,259,000	$ 9,416,000	$ 2,630,000
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation and amortization	2,072,000	460,000	585,000
Deferred income taxes	1,758,000	(1,427,000)
Impairment of goodwill	0	0	0
Lease abandonment expense (recovery), net	(44,000)	9,000	30,000
(Gain) loss on sale of equipment	(37,000)	11,000	(6,000)
Provision for doubtful accounts	659,000	510,000	101,000
Stock-based compensation	777,000	258,000	150,000
Accretion of contingent consideration	547,000
Changes in operating assets and liabilities, net of effects from business acquisitions:
Accounts receivable	(4,354,000)	(532,000)	2,216,000
Costs and estimated earnings in excess of billings on uncompleted contracts	(1,180,000)	(2,535,000)	225,000
Other receivables	31,000	4,000	(117,000)
Prepaid expenses and other current assets	203,000	133,000	(595,000)
Other assets	31,000	(202,000)	(26,000)
Accounts payable	1,842,000	(720,000)	(3,026,000)
Accrued liabilities	(1,320,000)	4,860,000	502,000
Billings in excess of costs and estimated earnings on uncompleted contracts	2,285,000	1,616,000	(1,172,000)
Deferred lease obligations	573,000	35,000	(284,000)
Net cash provided by operating activities	8,102,000	11,896,000	1,213,000
Cash flows from investing activities:
Purchase of equipment and leasehold improvements	(2,475,000)	(492,000)	(306,000)
Cash paid for acquisitions, net of cash acquired	(8,168,000)
Proceeds from sale of equipment	7,000	5,000	27,000
Net cash used in investing activities	(10,636,000)	(487,000)	(279,000)
Cash flows from financing activities:
Payments on notes payable	(2,090,000)	(162,000)	(621,000)
Proceeds from notes payable	2,606,000		510,000
Repayments of line of credit			(3,000,000)
Principal payments on capital lease obligations	(350,000)	(261,000)	(62,000)
Proceeds from stock option exercise	512,000	450,000	9,000
Proceeds from sales of common stock under employee stock purchase plan	170,000	76,000	73,000
Net cash provided by (used in) financing activities	848,000	103,000	(3,091,000)
Net (decrease) increase in cash and cash equivalents	(1,686,000)	11,512,000	(2,157,000)
Cash and cash equivalents at beginning of year	18,173,000	6,661,000	8,818,000
Cash and cash equivalents at end of year	16,487,000	18,173,000	6,661,000
Cash paid during the period for:
Interest	203,000	16,000	100,000
Income taxes	949,000	134,000	324,000
Supplemental disclosures of noncash investing and financing activities:
Issuance of notes payable related to business acquisitions	4,250,000
Issuance of common stock related to business acquisitions	1,485,000
Contingent consideration related to business acquisitions	5,178,000
Equipment acquired under capital lease obligations	$ 420,000	$ 677,000	$ 87,000

ORGANIZATION AND OPERATIONS OF THE COMPANY	12 Months Ended
ORGANIZATION AND OPERATIONS OF THE COMPANY	Jan. 01, 2016
ORGANIZATION AND OPERATIONS OF THE COMPANY
ORGANIZATION AND OPERATIONS OF THE COMPANY	1. ORGANIZATION AND OPERATIONS OF THE COMPANY Nature of Business Willdan Group, Inc. and subsidiaries (“Willdan Group” or the “Company”) is a provider of professional technical and consulting services, including comprehensive energy efficiency solutions, for utilities, private industry, and public agencies at all levels of government, primarily in California and New York. The Company also has operations in Arizona, Colorado, Florida, Illinois, Kansas, Oregon, Texas, Washington and Washington, D.C. The Company enables these entities to provide a wide range of specialized services without having to incur and maintain the overhead necessary to develop staffing in-house. The Company provides a broad range of complementary services including energy efficiency, engineering and planning, economic and financial consulting, and national preparedness and interoperability. The Company’s clients primarily consist of public and governmental agencies, including cities, counties, public utilities, redevelopment agencies, water districts, school districts and universities, state agencies, federal agencies, a variety of other special districts and agencies, private utilities and industry and tribal governments.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

12 Months Ended

Jan. 01, 2016

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Principles of Consolidation

The consolidated financial statements include the accounts of Willdan Group, Inc. and its wholly owned subsidiaries, Willdan Energy Solutions, Willdan Engineering, Public Agency Resources, Willdan Financial Services and Willdan Homeland Solutions. All significant intercompany balances and transactions have been eliminated in consolidation.

Fiscal Years

The Company operates and reports its annual financial results based on 52 or 53-week periods ending on the Friday closest to December 31, with consideration of business days. The Company operates and reports its quarterly financial results based on the 13-week period ending on the Friday closest to March 31, June 30 and September 30 and the 13 or 14-week period ending on the Friday closest to December 31, as applicable, with consideration of business days. Fiscal years 2015 and 2013 contained 52 weeks. Fiscal year 2014 contained 53 weeks. All references to years in the notes to consolidated financial statements represent fiscal years.

Cash, Cash Equivalents and Liquid Investments

All highly liquid investments purchased with a remaining maturity of three months or less are considered to be cash equivalents. Cash and cash equivalents consisted of the following:


	January 1,		January 2,
	2016		2015
BMO Harris Bank Master Control Operating Account	$	16,438,000	$	18,119,000
Cash on hand in business checking accounts		49,000		54,000
	$	16,487,000	$	18,173,000

The Company from time to time may be exposed to credit risk with its bank deposits in excess of the FDIC insurance limits and with uninsured money market investments. The Company has not experienced any losses in such accounts and believes it is not exposed to any significant credit risk on cash and cash equivalents.

Fair Value of Financial Instruments

As of January 1, 2016 and January 2, 2015, the carrying amounts of the Company's cash and cash equivalents, accounts receivable, costs and estimated earnings in excess of billings on uncompleted contracts, other receivables, prepaid expenses and other current assets, excess of outstanding checks over bank balance, accounts payable, accrued liabilities and billings in excess of costs and estimated earnings on uncompleted contracts, approximate their fair values because of the relatively short period of time between the origination of these instruments and their expected realization or payment. The carrying amounts of debt obligations approximate their fair values since the terms are comparable to terms currently offered by local lending institutions for loans of similar terms to companies with comparable credit risk.

Segment Information

Willdan Group, Inc. (“WGI”) is a holding company with six wholly owned subsidiaries. The Company presents segment information externally consistent with the manner in which the Company’s chief operating decision maker reviews information to assess performance and allocate resources. WGI performs administrative functions on behalf of its subsidiaries, such as treasury, legal, accounting, information systems, human resources and certain business development activities, and earns revenue that is only incidental to the activities of the enterprise. As a result, WGI does not meet the definition of an operating segment. Three of the six WGI subsidiaries are aggregated into one reportable segment as they have similar economic characteristics including the nature of services, the methods used to provide services and the type of customers. The remaining three subsidiaries each comprise separate reporting segments. See Note 13.

Off‑Balance Sheet Arrangements

Other than operating lease commitments, the Company does not have any off‑balance sheet financing arrangements or liabilities. In addition, the Company’s policy is not to enter into derivative instruments, futures or forward contracts. Finally, the Company does not have any majority‑owned subsidiaries or any interests in, or relationships with, any special‑purpose entities that are not included in the consolidated financial statements.

Accounting for Contracts

The Company enters into contracts with its clients that contain various types of pricing provisions, including fixed price, time-and-materials, unit-based and service related provisions. The following table reflects the Company’s four reportable segments and the types of contracts that each most commonly enters into for revenue generating activities.


	Types of Contract
Segment	(Revenue Recognition Method)
Energy Efficiency Services	Unit-based and time-and-materials (percentage-of-completion method)
Engineering Services	Time-and-materials, unit-based and fixed price (percentage-of-completion method)
Public Finance Services	Service related contracts (proportional performance method)
Homeland Security Services	Service related contracts (proportional performance method)

Revenue on fixed price contracts is recognized on the percentage-of-completion method based generally on the ratio of direct costs (primarily exclusive of depreciation and amortization costs) incurred to date to estimated total direct costs at completion. Revenue on time-and-materials and unit-based contracts is recognized as the work is performed in accordance with the specific terms of the contract. The Company recognizes revenues for time-and-material contracts based upon the actual hours incurred during a reporting period at contractually agreed upon rates per hour and also includes in revenue all reimbursable costs incurred during a reporting period for which the Company has risk or on which the fee was based at the time of bid or negotiation. Certain of the Company’s time-and-material contracts are subject to maximum contract values and, accordingly, revenue under these contracts is generally recognized under the percentage-of-completion method, consistent with fixed priced contracts. Revenue on contracts that are not subject to maximum contract values is recognized based on the actual number of hours the Company spends on the projects plus any actual out-of-pocket costs of materials and other direct incidental expenditures that the Company incurs on the projects. In addition, revenue from overhead percentage recoveries and earned fees are included in revenue. Revenue is recognized as the related costs are incurred. For unit-based contracts, the Company recognizes the contract price of units of a basic production product as revenue when the production product is delivered during a period. Revenue for amounts that have been billed but not earned is deferred and such deferred revenue is referred to as billings in excess of costs and estimated earnings on uncompleted contracts in the accompanying consolidated balance sheets.

Adjustments to contract cost estimates are made in the periods in which the facts requiring such revisions become known. When the revised estimate, for contracts that are recognized under the percentage-of-completion method, indicates a loss, such loss is provided for currently in its entirety. Claims revenue is recognized only upon resolution of the claim. Change orders in dispute are evaluated as claims. Costs related to un-priced change orders are expensed when incurred and recognition of the related contract revenue is based on an evaluation of the probability of recovery of the costs. Estimated profit is recognized for un-priced change orders if realization of the expected price of the change order is probable.

The Company considers whether its contracts require combining for revenue recognition purposes. If certain criteria are met, revenues for related contracts may be recognized on a combined basis. With respect to the Company’s contracts, it is rare that such criteria are present. The Company may enter into certain contracts which include separate phases or elements. If each phase or element is negotiated separately based on the technical resources required and/or the supply and demand for the services being provided, the Company evaluates if the contracts should be segmented. If certain criteria are met, the contracts would be segmented which could result in revenues being assigned to the different elements or phases with different rates of profitability based on the relative value of each element or phase to the estimated total contract revenue.

Applying the percentage-of-completion method of recognizing revenue requires the Company to estimate the outcome of its long-term contracts. The Company forecasts such outcomes to the best of its knowledge and belief of current and expected conditions and its expected course of action. Differences between the Company's estimates and actual results often occur resulting in changes to reported revenue and earnings. Such changes could have a material effect on future consolidated financial statements. The Company did not have material revisions in estimates for contracts recognized using the percentage-of-completion method for any of the periods presented in the accompanying condensed consolidated financial statements.

Service-related contracts, including operations and maintenance services and a variety of technical assistance services, are accounted for over the period of performance, in proportion to the costs of performance. Award and incentive fees are recorded when they are fixed and determinable and consider customer contract terms.

Direct costs of contract revenue consist primarily of that portion of technical and nontechnical salaries and wages that has been incurred in connection with revenue producing projects. Direct costs of contract revenue also include production expenses, subcontractor services and other expenses that are incurred in connection with revenue producing projects.

Direct costs of contract revenue exclude that portion of technical and nontechnical salaries and wages related to marketing efforts, vacations, holidays and other time not spent directly generating revenue under existing contracts. Such costs are included in general and administrative expenses. Additionally, payroll taxes, bonuses and employee benefit costs for all Company personnel are included in general and administrative expenses in the accompanying consolidated statements of operations since no allocation of these costs is made to direct costs of contract revenue. No allocation of facilities costs is made to direct costs of contract revenue. Other companies may classify as direct costs of contract revenue some of the costs that the Company classifies as general and administrative costs. The Company expenses direct costs of contract revenue when incurred.

Included in revenue and costs are all reimbursable costs for which the Company has the risk or on which the fee was based at the time of bid or negotiation. No revenue or cost is recorded for costs in which the Company acts solely in the capacity of an agent and has no risks associated with such costs.

Accounts receivable are carried at original invoice amount less an estimate made for doubtful accounts based upon a review of all outstanding amounts on a quarterly basis. Management determines the allowance for doubtful accounts by identifying troubled accounts and by using historical experience applied to an aging of accounts. Credit risk is generally minimal with governmental entities, but disputes may arise related to these receivable amounts. Accounts receivables are written off when deemed uncollectible. Recoveries of accounts receivables previously written off are recorded when received.

Retainage is included in accounts receivable in the accompanying consolidated financial statements. Retainage represents the billed amount that is retained by the customer, in accordance with the terms of the contract, generally until performance is substantially complete. At January 1, 2016 and January 2, 2015, the Company had retained accounts receivable of approximately $748,000 and $700,000, respectively.

General and Administrative Expenses

General and administrative expenses include the costs of the marketing and support staffs, other marketing expenses, management and administrative personnel costs, payroll taxes, bonuses and employee benefits for all of the Company’s employees and the portion of salaries and wages not allocated to direct costs of contract revenue for those employees who provide the Company’s services. General and administrative expenses also include facility costs, depreciation and amortization, professional services, legal and accounting fees and administrative operating costs. Within general and administrative expenses, “Other” includes expenses such as provision for billed or unbilled receivables, professional services, legal and accounting, computer costs, travel and entertainment, marketing costs and acquisition costs. The Company expenses general and administrative costs when incurred.

Leases

All of the Company’s office leases are classified as operating leases and rent expense is included in facilities expense in the accompanying consolidated statements of operations. Some of the lease terms include rent concessions and rent escalation clauses, all of which are taken into account in computing minimum lease payments. Minimum lease payments are recognized on a straight‑line basis over the minimum lease term. The excess of rent expense recognized over the amounts contractually due pursuant to the underlying leases is reflected as a liability in the accompanying consolidated balance sheets. The cost of improvements that the Company makes to the leased office space is capitalized as leasehold improvements. The Company is subject to non‑cancellable leases for offices or portions of offices for which use has ceased. For each of these abandoned leases, the present value of the future lease payments, net of estimated sublease payments, along with any unamortized tenant improvement costs, are recognized as lease abandonment expense in the Company’s consolidated statements of operations with a corresponding liability in the Company’s consolidated balance sheets.

Equipment and Leasehold Improvements

Equipment and leasehold improvements are stated at cost less accumulated depreciation and amortization. Equipment under capital leases is stated at the present value of the minimum lease payments as of the acquisition date. Depreciation and amortization on equipment are calculated using the straight‑line method over estimated useful lives of two to five years. Leasehold improvements and assets under capital leases are amortized using the straight‑line method over the shorter of estimated useful lives or the term of the related lease.

Following are the estimated useful lives used to calculate depreciation and amortization:


Category	Estimated Useful Life
Furniture and fixtures	5	years
Computer hardware	2	years
Computer software	3	years
Automobiles and trucks	3	years
Field equipment	5	years

Long-lived assets

Long-lived assets, such as equipment, leasehold improvements and purchased intangible assets subject to amortization are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to estimated undiscounted future cash flows expected to be generated by the asset. If the carrying amount of an asset exceeds its estimated future cash flows, an impairment charge is recognized by the amount by which the carrying amount of the asset exceeds the fair value of the asset.

Goodwill

Goodwill represents the excess of costs over fair value of the assets acquired. We complete our annual testing of goodwill as of the last day of the first month of our fourth fiscal quarter each year to determine whether there is impairment. Goodwill, which has an indefinite useful life, is not amortized, but instead tested for impairment at least annually or more frequently if events and circumstances indicate that the asset might be impaired. Impairment losses for reporting units are recognized to the extent that a reporting unit’s carrying amount exceeds its fair value.

Accounting for Claims Against the Company

The Company accrues an undiscounted liability related to claims against it for which the incurrence of a loss is probable and the amount can be reasonably estimated. The Company discloses the amount accrued and an estimate of any reasonably possible loss in excess of the amount accrued, if such disclosure is necessary for its financial statements not to be misleading. The Company does not accrue liabilities related to claims when the likelihood that a loss has been incurred is probable but the amount cannot be reasonably estimated, or when the liability is believed to be only reasonably possible or remote. Losses related to recorded claims are included in general and administrative expenses.

Determining probability and estimating claim amounts is highly judgmental. Initial accruals and any subsequent changes in the Company’s estimates could have a material effect on its consolidated financial statements.

Stock Options

The Company accounts for stock options under the fair value recognition provisions of the accounting standard entitled “Compensation—Stock Compensation.” This standard requires the measurement of compensation cost at the grant date, based upon the estimated fair value of the award, and requires amortization of the related expense over the employee’s requisite service period.

Business Combinations

The acquisition method of accounting for business combinations requires the Company to use significant estimates and assumptions, including fair value estimates, as of the business combination date and to refine those estimates as necessary during the measurement period (defined as the period, not to exceed one year, in which the Company may adjust the provisional amounts recognized for a business combination based on new information relating to facts and circumstances that existed as of the acquisition date).

Under the acquisition method of accounting, the Company recognizes separately from goodwill the identifiable assets acquired, the liabilities assumed, and any noncontrolling interests in an acquiree, generally at the acquisition date fair value. The Company measures goodwill as of the acquisition date as the excess of consideration transferred, which it also measures at fair value, over the net of the acquisition date amounts of the identifiable assets acquired and liabilities assumed. Costs that the Company incurs to complete the business combination such as investment banking, legal and other professional fees are not considered part of consideration and the Company charges them to other expense as they are incurred.

Income Taxes

Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences of temporary differences between the financial reporting basis and tax basis of the Company’s assets and liabilities, subject to judgmental assessment of the recoverability of deferred tax assets. Deferred tax assets and liabilities 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. A valuation allowance is recorded when it is more likely than not that all or a portion of the deferred tax assets may not be realized. Significant judgment is applied when assessing the need for valuation allowances. Areas of estimation include the Company’s consideration of future taxable income and ongoing prudent and feasible tax planning strategies. Should a change in circumstances lead to a change in judgment about the utilization of deferred tax assets in future years, the Company would adjust the related valuation allowances in the period that the change in circumstances occurs, along with a corresponding increase or charge to income.

During fiscal year 2015, the Company assessed the available positive and negative evidence to estimate if sufficient future taxable income will be generated to utilize the existing deferred tax assets. The Company has ultimately determined that it is not more-likely-than-not that the entire California net operating loss will be utilized prior to expiration. Significant pieces of objective evidence evaluated included our history of utilization of California net operating losses in prior years for each of our subsidiaries, as well as our forecasted amount of net operating loss utilization for certain members of the combined group. Based on this evaluation, as of January 1, 2016, the Company recorded a valuation allowance in the amount of $73,000 related to California net operating losses.

During the year ended January 2, 2015, management assessed the available positive and negative evidence to estimate if sufficient future taxable income will be generated to utilize the existing deferred tax assets. Based on this evaluation, as of January 2, 2015, the Company reversed the $4.6 million valuation allowance on its deferred tax assets.

For acquired business entities, if the Company identifies changes to acquired deferred tax asset valuation allowances or liabilities related to uncertain tax positions during the measurement period and they relate to new information obtained about facts and circumstances that existed as of the acquisition date, those changes are considered a measurement period adjustment and the Company records the offset to goodwill. The Company records all other changes to deferred tax asset valuation allowances and liabilities related to uncertain tax positions in current period income tax expense.

The Company recognizes the tax benefit from uncertain tax positions if it is more likely than not that the tax positions will be sustained on examination by the tax authorities, based on the technical merits of the position. The tax benefit is measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. The Company recognizes interest and penalties related to unrecognized tax benefits in income tax expense.

Operating Cycle

In accordance with industry practice, amounts realizable and payable under contracts that extend beyond one year are included in current assets and liabilities.

Use of Estimates

The preparation of consolidated financial statements in conformity with generally accepted accounting principles in the U.S. requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements. Estimates also affect the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.

Reclassifications

Certain prior year amounts have been reclassified for consistency with the current period presentation. These reclassifications had no effect on the reported results of operations.

New Accounting Pronouncements

In May 2014, the FASB issued Accounting Standards Update ("ASU") No. 2014-09, Revenue from Contracts with Customers (“ASU 2014-09”), which clarifies existing accounting literature relating to how and when revenue is recognized by an entity. ASU 2014-09 affects any entity that either enters into contracts with customers to transfer goods or services or enters into contracts for the transfer of nonfinancial assets and supersedes the revenue recognition requirements in Topic 605, Revenue Recognition, and most industry-specific guidance. ASU 2014-09 requires an entity to recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which an entity expects to be entitled in exchange for those goods or services. In doing so, an entity will need to exercise a greater degree of judgment and make more estimates than under the current guidance. These may include identifying performance obligations in the contract, estimating the amount of variable consideration to include in the transaction price, and allocating the transaction price to each separate performance obligation. ASU 2014-09 also supersedes some cost guidance included in Subtopic 605-35, Revenue Recognition-Construction-Type and Production-Type Contracts. In August 2015, the FASB issued Update 2015-14, which defers the implementation of ASU 2014-09 for one year from the initial effective date. ASU 2014-09 is effective for public companies for interim and annual reporting periods beginning after December 15, 2017, and is to be applied either retrospectively or using the cumulative effect transition method, with early adoption not permitted. The Company has not yet selected a transition method, and is currently evaluating the impact the adoption of ASU 2014-09 will have on its consolidated financial statements and related disclosures.

In February 2015, the FASB issued Update 2015-02, which amends the consolidation requirements in Accounting Standards Codification 810 and changes the consolidation analysis required under GAAP. The standard is effective for fiscal years, and interim periods within those years, beginning after December 15, 2015, with early adoption permitted. The Company determined that the impact of the new standard on its consolidated financial statements will not be material.

In April 2015, the FASB issued ASU 2015-03, Simplifying the Presentation of Debt Issuance Costs. To simplify presentation of debt issuance costs, this new guidance requires that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. This guidance will become effective for financial statements issued for fiscal years beginning after December 15, 2015 and interim periods within those fiscal years. The Company has determined the potential impacts of the new standard on its existing debt issuance costs are not material.

In September 2015, the FASB issued Update 2015-16, which requires that an acquirer recognize adjustments to provisional amounts that are identified during the measurement period in the reporting period in which the adjustment amounts are determined. The acquirer must record, in the same period’s financial statements, the effect on earnings of changes in depreciation, amortization, or other income effects, if any, as a result of the change to the provisional amounts, calculated as if the accounting had been completed at the acquisition date. Update 2015-16 further requires an entity to present separately on the face of the income statement or disclose in the notes, the portion of the amount recorded in current-period earnings by line item that would have been recorded in previous reporting periods if the adjustment to the provisional amounts had been recognized as of the acquisition date. The standard is effective for fiscal years, and interim periods within those years, beginning after December 15, 2015, with early adoption permitted. The Company has elected early adoption of this standard in fiscal 2015.

In February 2016, the FASB issued ASU No. 2016-02, “Leases” (topic 842). The FASB issued this update to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. The updated guidance is effective for annual periods beginning after December 15, 2018, including interim periods within those fiscal years. Early adoption of the update is permitted. The Company is evaluating the impact of the adoption of this update on our consolidated financial statements and related disclosures.

A variety of proposed or otherwise potential accounting standards are currently being studied by standard-setting organizations and certain regulatory agencies. Because of the tentative and preliminary nature of such proposed standards, we have not yet determined the effect, if any, that the implementation of such proposed standards would have on our consolidated financial statements.

BUSINESS COMBINATIONS

12 Months Ended

Jan. 01, 2016

BUSINESS COMBINATIONS

BUSINESS COMBINATIONS

3. BUSINESS COMBINATIONS

On January 15, 2015, the Company and its wholly-owned subsidiary, Willdan Energy Solutions (“WES”) completed two separate acquisitions. The Company and WES acquired all of the outstanding shares of Abacus Resource Management Company (“Abacus”), an Oregon-based energy engineering company. In addition, the Company and WES also separately acquired substantially all of the assets of 360 Energy Engineers, LLC (“360 Energy”), a Kansas-based energy and engineering energy management consulting company.

Pursuant to the terms of the Stock Purchase Agreement, dated as of January 15, 2015, by and between the Company, WES, Abacus and the selling shareholders of Abacus (the “Abacus Shareholders”), WES will pay the Abacus Shareholders a maximum purchase price of $6.1 million, consisting of (i) $2.5 million in cash which was paid at closing, with the balance of $0.6 million paid after closing, (ii) 75,758 shares of Common Stock, par value $0.01 per share, of the Company (“Common Stock”) with a fair value of $0.9 million which were issued at closing, (iii) $1.25 million aggregate principal amount of promissory notes issued to the Abacus Shareholders at closing and (iv) up to $0.8 million in cash, based on the achievement of certain financial targets by Abacus at the end of the Company’s 2015 and 2016 fiscal years.

Pursuant to the terms of the Asset Purchase Agreement, dated January 15, 2015, by and between the Company, WES and 360 Energy, WES will pay 360 Energy a maximum purchase price of $15.0 million, consisting of (i) $4.9 million in cash which was paid at closing, (ii) 47,348 shares of Common Stock with a fair value of $0.6 million which were issued at closing, (iii) $3.0 million aggregate principal amount of promissory note issued to 360 Energy at closing and (iv) up to $6.5 million in cash, based on the achievement of certain financial targets by WES’s division made up of the assets acquired from, and the former employees of 360 Energy at the end of the Company’s 2015, 2016 and 2017 fiscal years. The Company also provided a guaranty to 360 Energy which guarantees WES’s obligations under the promissory note issued to 360 Energy.

The fair value of the 75,758 and 47,348 shares of common stock issued as part of the consideration paid for Abacus ($0.9 million) and 360 Energy ($0.6 million) respectively, was determined on the basis of the price of the Company’s common shares on the acquisition date.

To finance the acquisitions of Abacus and 360 Energy, the Company borrowed $2.0 million under its delayed draw term loan facility. The Company used cash on hand to pay the remaining $5.4 million due at closing.

On April 3, 2015, the Company’s wholly-owned subsidiary, Willdan Financial Services (“WFS”) acquired substantially all of the assets of Economists.com, LLC ("Economists LLC"), a Texas-based economic analysis and financial solutions firm serving the municipal and public sectors. Pursuant to the terms of the Asset Purchase Agreement, dated April 3, 2015, by and between WFS and Economists LLC, WFS will pay Economists LLC a maximum purchase price of $1.1 million, consisting of (i) $0.5 million in cash which was paid at closing and (ii) up to $0.6 million in cash, based on the achievement of certain financial targets by the WFS division made up of the assets acquired from, and the former employees of Economists LLC at the end of the Company’s 2015, 2016 and 2017 fiscal years. The Company used cash on hand to pay the $0.5 million due at closing.

The acquisitions were accounted for as business combinations in accordance with ASC 805. Under ASC 805, the Company recorded the acquired assets and assumed liabilities at their estimated fair value with the excess allocated to goodwill. Goodwill represents the value the Company expects to achieve through the operational synergies and the expansion of the Company into new markets. The Company estimates that the entire $16.5 million of goodwill resulting from the acquisitions will be tax deductible. Consideration for the acquisitions includes the following:


	360 Energy		Abacus		Economists, LLC		Total

Cash paid	$	4,875,000	$	3,136,000	$	490,000	$	8,501,000
Issuance of common stock		571,000		913,000		—		1,484,000
Issuance of notes payable		3,000,000		1,250,000		—		4,250,000
Contingent consideration		4,221,000		589,000		368,000		5,178,000
Total consideration	$	12,667,000	$	5,888,000	$	858,000	$	19,413,000

The following table summarizes the amounts for the acquired assets and liabilities recorded at their estimated fair value as of the acquisition date:


	360 Energy		Abacus		Economists, LLC		Total

Cash acquired	$	—	$	332,000	$	—	$	332,000
Property, plant and equipment		166,000		78,000		—		244,000
Liabilities		—		(512,000)		—		(512,000)
License to bid		—		308,000		—		308,000
Backlog		158,000		161,000		29,000		348,000
Tradename		669,000		323,000		57,000		1,049,000
Non-compete agreements		860,000		128,000		23,000		1,011,000
Other assets, net		41,000		495,000		—		536,000
Goodwill		10,773,000		4,575,000		749,000		16,097,000
Net assets acquired	$	12,667,000	$	5,888,000	$	858,000	$	19,413,000

The acquisition date fair value of the intangible asset relating to tradenames was estimated using discounted cash flows based on the relief from royalty method. The liabilities assumed were measured based on the estimated costs related to the remediation of an environmental liability associated with one of the construction projects that was acquired on the date of acquisition in accordance with ASC 450. These assets are deemed to have a finite life. As of January 1, 2016, the Company has contingent consideration payable of $5.7 million related to these acquisitions, which includes $0.5 million of accretion related to the contingent consideration. Contingent consideration is subject to change for each reporting period through settlement. The Company measures the contingent earn-out liabilities at fair value on the date of acquisition and on a recurring basis using significant unobservable inputs classified within Level 3 of the fair value hierarchy. The Company uses a probability-weighted discounted income approach as a valuation technique to convert future estimated cash flows to a single present value amount. The significant unobservable inputs used in the fair value measurements are operating income projections over the earn-out period, and the probability outcome percentages assigned to each scenario. Significant increases or decreases to either of these inputs in isolation would result in a significantly higher or lower liability, with a higher liability capped by the contractual maximum of the contingent earn-out obligation. Ultimately, the liability will be equivalent to the amount paid, and the difference between the fair value estimate and amount paid will be recorded in earnings. As of January 1, 2016 the amount recognized for the contingent consideration arrangements was $5.7 million which reflects a change in the estimated timing of the payments. There were no changes to the ranges of estimated payments or discount rates.

During the fourth quarter of fiscal 2015, the Company obtained further information on the valuation of acquired assets and liabilities assumed and, in accordance with the authoritative guidance for business combinations, recorded purchase price adjustments as of the acquisition date to increase the fair values of intangible assets by $0.4 million and increased accrued liabilities by $0.5 million. Purchase price adjustments were also recorded to reduce the fair value of contingent consideration payable by $0.9 million. These adjustments to the provisional purchase price allocations decreased goodwill by $0.8 million.

The Company also adjusted its fourth quarter consolidated results of operations and cash flows for the impacts of the adjustments to the provisional purchase price allocations. As a result of the adjustments, net income for the year ended January 1, 2016 increased by $0.2 million and equity as of January 1, 2016 increased by the same amount.

Acquisition related costs of $0.2 million and $0.3 million are included in other general and administrative expense in the consolidated statements of operations for the years ending January 1, 2016 and January 2, 2015, respectively.

The following unaudited pro forma financial information for the twelve months ended January 1, 2016 and January 2, 2015 assumes the acquisitions of Abacus and 360 Energy occurred on December 28, 2013 as follows:


	Year Ended
	January 1,		January 2,
In thousands (except per share data)	2016		2015
Pro forma revenue	$	135,576	$	130,181

Pro forma income from operations		8,204		12,162
Pro forma net income	$	4,759	$	12,162

Earnings per share:
Basic	$	0.61	$	1.62
Diluted	$	0.59	$	1.57

Weighted average shares outstanding:
Basic		7,834		7,488
Diluted		8,113		7,739

This pro forma supplemental information does not purport to be indicative of what the Company’s operating results would have been had these transactions occurred on December 28, 2013 and may not be indicative of future operating results.

During the fiscal year ended January 1, 2016, the acquisitions of Abacus, 360 Energy and Economist contributed $23.8 million in revenue and $1.3 million of income from operations.

- Definition

The entire disclosure for a business combination (or series of individually immaterial business combinations) completed during the period, including background, timing, and recognized assets and liabilities. The disclosure may include leverage buyout transactions (as applicable).

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 805
-SubTopic 10
-Section 50
-Paragraph 5
-URI http://asc.fasb.org/extlink&oid=56956515&loc=d3e1497-128463

Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 805
-SubTopic 10
-Section 50
-Paragraph 4
-URI http://asc.fasb.org/extlink&oid=56956515&loc=d3e1490-128463

Reference 3: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 805
-SubTopic 10
-Section 50
-Paragraph 2
-URI http://asc.fasb.org/extlink&oid=56956515&loc=d3e1392-128463

Reference 4: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 805
-SubTopic 30
-Section 50
-Paragraph 4
-URI http://asc.fasb.org/extlink&oid=35744584&loc=d3e7008-128479

Reference 5: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 805
-SubTopic 10
-Section 50
-Paragraph 3
-URI http://asc.fasb.org/extlink&oid=56956515&loc=d3e1486-128463

Reference 6: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
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Reference 7: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 805
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-Section 50
-Paragraph 1
-URI http://asc.fasb.org/extlink&oid=56956791&loc=d3e4845-128472

Reference 8: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 805
-SubTopic 10
-Section 50
-Paragraph 6
-URI http://asc.fasb.org/extlink&oid=56956515&loc=d3e1500-128463

Reference 9: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 805
-SubTopic 10
-Section 50
-Paragraph 7
-URI http://asc.fasb.org/extlink&oid=56956515&loc=d3e1524-128463

Reference 10: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 805
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-Paragraph 3
-URI http://asc.fasb.org/extlink&oid=35744584&loc=d3e7000-128479

Reference 11: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
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Reference 12: http://www.xbrl.org/2003/role/presentationRef
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Reference 13: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
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-URI http://asc.fasb.org/extlink&oid=56956791&loc=d3e4926-128472

Reference 14: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
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-URI http://asc.fasb.org/extlink&oid=56956515&loc=d3e1383-128463

Reference 15: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
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-URI http://asc.fasb.org/extlink&oid=35744584&loc=d3e6996-128479

+ Details

GOODWILL AND OTHER INTANGIBLE ASSETS

12 Months Ended

Jan. 01, 2016

GOODWILL AND OTHER INTANGIBLE ASSETS

GOODWILL AND OTHER INTANGIBLE ASSETS

4. GOODWILL AND OTHER INTANGIBLE ASSETS

As of January 1, 2016, the Company had $16.1 million of goodwill, which primarily relates to the Energy Efficiency Services reporting segment and the acquisitions of Abacus and 360 Energy. The Company had no goodwill outstanding as of January 2, 2015. The changes in the carrying value of goodwill by reporting unit for the twelve months ended January 1, 2016 were as follows:


			Additional		Final
	January 2,		Purchase		Fair Value				January 1,
	2015		Cost		Adjustment		Impairment		2016

Reporting Unit:
Energy Efficiency Solutions	$	—	$	15,348,000	$	—	$	—	$	15,348,000
Public Finance Services		—		749,000		—		—		749,000
	$	—	$	16,097,000	$	—	$	—	$	16,097,000

The gross amounts and accumulated amortization of the Company’s acquired identifiable intangible assets with finite useful lives as of January 1, 2016 and January 2, 2015, included in intangible assets, net in the accompanying consolidated balance sheets, were as follows:


	January 1, 2016				January 2, 2015
	Gross		Accumulated		Gross		Accumulated		Amortization
	Amount		Amortization		Amount		Amortization		Period (yrs)
Backlog	$	348,000	$	340,000	$	—	$	—	1
Tradename		1,049,000		329,000		—		—	2.5 - 3.5
Non-compete agreements		1,011,000		194,000		—		—	4 - 5
License to bid		308,000		308,000		—		—	1
	$	2,716,000	$	1,171,000	$	—	$	—

The Company’s amortization expense for acquired identifiable intangible assets with finite useful lives was $1.2 million for the year ended January 1, 2016, and $0 for the years ended January 2, 2015, and December 27, 2013 respectively. Estimated amortization expense for acquired identifiable intangible assets for fiscal 2016 and the succeeding years is as follows:


Fiscal year:
2016	$	553,000
2017		475,000
2018		306,000
2019		202,000
2020		9,000
	$	1,545,000

At the time of acquisition, the Company estimates the fair value of the acquired identifiable intangible assets based upon the facts and circumstances related to the particular intangible asset. Inherent in such estimates are judgments and estimates of future revenue, profitability, cash flows and appropriate discount rates for any present value calculations. The Company preliminarily estimates the value of the acquired identifiable intangible assets and then finalizes the estimated fair values during the purchase allocation period, which does not extend beyond 12 months from the date of acquisition.

The Company tests its goodwill at least annually for possible impairment. The Company completes its annual testing of goodwill as of the last day of the first month of its fourth fiscal quarter each year to determine whether there is impairment. In addition to the Company’s annual test, it regularly evaluates whether events and circumstances have occurred that may indicate a potential impairment of goodwill. No impairment was recorded during the years ended January 1, 2016, January 2, 2015 or December 27, 2013.

- Definition

The entire disclosure for the aggregate amount of goodwill and a description of intangible assets, which may include (a) for amortizable intangible assets (also referred to as finite-lived intangible assets), the carrying amount, the amount of any significant residual value, and the weighted-average amortization period, (b) for intangible assets not subject to amortization (also referred to as indefinite-lived intangible assets), the carrying amount, and (c) the amount of research and development assets acquired and written off in the period, including the line item in the income statement in which the amounts written off are aggregated, if not readily apparent from the income statement. Also discloses (a) for amortizable intangibles assets in total and by major class, the gross carrying amount and accumulated amortization, the total amortization expense for the period, and the estimated aggregate amortization expense for each of the five succeeding fiscal years, (b) for intangible assets not subject to amortization the carrying amount in total and by major class, and (c) for goodwill, in total and for each reportable segment, the changes in the carrying amount of goodwill during the period (including the aggregate amount of goodwill acquired, the aggregate amount of impairment losses recognized, and the amount of goodwill included in the gain (loss) on disposal of a reporting unit). If any part of goodwill has not been allocated to a reportable segment, discloses the unallocated amount and the reasons for not allocating. For each impairment loss recognized related to an intangible asset (excluding goodwill), discloses: (a) a description of the impaired intangible asset and the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method for determining fair value, (c) the caption in the income statement or the statement of activities in which the impairment loss is aggregated, and (d) the segment in which the impaired intangible asset is reported. For each goodwill impairment loss recognized, discloses: (a) a description of the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method of determining the fair value of the associated reporting unit, and (c) if a recognized impairment loss is an estimate not finalized and the reasons why the estimate is not final. May also disclose the nature and amount of any significant adjustments made to a previous estimate of an impairment loss.

+ References + Details

EARNINGS PER SHARE ("EPS")

12 Months Ended

Jan. 01, 2016

EARNINGS PER SHARE (EPS)

EARNINGS PER SHARE (EPS)

5. EARNINGS PER SHARE (“EPS”)

Basic EPS is computed by dividing net income available to common stockholders by the weighted‑average number of common shares outstanding. Diluted EPS is computed by dividing net income by the weighted‑average number of common shares outstanding and dilutive potential common shares for the period. Potential common shares include the weighted‑average dilutive effects of outstanding stock options using the treasury stock method.

The following table sets forth the number of weighted‑average shares used to compute basic and diluted EPS:


	Fiscal Year

	2015		2014		2013
Net income	$	4,259,000	$	9,416,000	$	2,630,000
Weighted-average common shares outstanding		7,834,000		7,488,000		7,355,000
Effect of dilutive stock options and restricted stock awards		279,000		251,000		140,000
Weighted-average common stock outstanding-diluted		8,113,000		7,739,000		7,495,000
Earnings per share:
Basic	$	0.54	$	1.26	$	0.36
Diluted	$	0.52	$	1.22	$	0.35

For the fiscal year ended January 1, 2016, 314,500 options were excluded from the calculation of dilutive potential common shares, compared to 251,000 and 459,000 options, for fiscal 2014 and fiscal 2013, respectively. These options were not included in the computation of dilutive potential common shares because the assumed proceeds per share exceeded the average market price per share for the respective periods. Accordingly, the inclusion of these options would have been anti‑dilutive. For periods in which the Company incurs net losses, dilutive potential common shares are excluded as they would be anti‑dilutive.

ACCOUNTS RECEIVABLE

12 Months Ended

Jan. 01, 2016

ACCOUNTS RECEIVABLE

ACCOUNTS RECEIVABLE

6. ACCOUNTS RECEIVABLE

Accounts receivable consisted of the following at January 1, 2016 and January 2, 2015:


	January 1,		January 2,
	2016		2015
Billed	$	17,941,000	$	13,151,000
Unbilled		13,840,000		12,170,000
Contract retentions		748,000		700,000
		32,529,000		26,021,000
Allowance for doubtful accounts		(760,000)		(662,000)
	$	31,769,000	$	25,359,000

The movements in the allowance for doubtful accounts consisted of the following for fiscal years 2015, 2014 and 2013:


	Fiscal Year
	2015		2014		2013
Balance as of the beginning of the year	$	662,000	$	385,000	$	303,000
Provision for doubtful accounts		586,000		486,000		189,000
Write-offs of uncollectible accounts		(488,000)		(209,000)		(107,000)
Recoveries of accounts written off		—		—		—
Balance as of the end of the year	$	760,000	$	662,000	$	385,000

Billed accounts receivable represent amounts billed to clients that have yet to be collected. Unbilled accounts receivable represent revenue recognized but not yet billed pursuant to contract terms or accounts billed after the period end. Substantially all unbilled receivables as of January 1, 2016 and January 2, 2015 are or were expected to be billed and collected within twelve months of such date. Contract retentions represent amounts invoiced to clients where payments have been withheld pending the completion of certain milestones, other contractual conditions or upon the completion of the project. These retention agreements vary from project to project and could be outstanding for several months.

Allowances for doubtful accounts have been determined through specific identification of amounts considered to be uncollectible and potential write‑offs, plus a non‑specific allowance for other amounts for which some potential loss has been determined to be probable based on current and past experience.

As of January 1, 2016, one client accounted for 15% of outstanding receivables, as compared to 17% of the Company’s outstanding receivables as of January 2, 2015.

EQUIPMENT AND LEASEHOLD IMPROVEMENTS

12 Months Ended

Jan. 01, 2016

EQUIPMENT AND LEASEHOLD IMPROVEMENTS

EQUIPMENT AND LEASEHOLD IMPROVEMENTS

7. EQUIPMENT AND LEASEHOLD IMPROVEMENTS

Equipment and leasehold improvements consisted of the following at January 1, 2016 and January 2, 2015:


	January 1,		January 2,
	2016		2015
Furniture and fixtures	$	2,270,000	$	2,994,000
Computer hardware and software		6,496,000		5,667,000
Leasehold improvements		1,072,000		785,000
Equipment under capital leases		1,266,000		919,000
Automobiles, trucks, and field equipment		984,000		677,000
		12,088,000		11,042,000
Accumulated depreciation and amortization		(8,404,000)		(9,658,000)
Equipment and leasehold improvements, net	$	3,684,000	$	1,384,000

Included in accumulated depreciation and amortization is $259,000 and $176,000 of amortization expense related to equipment held under capital leases in fiscal years 2015 and 2014, respectively.

ACCRUED LIABILITIES

12 Months Ended

Jan. 01, 2016

ACCRUED LIABILITIES

ACCRUED LIABILITIES

8. ACCRUED LIABILITIES

Accrued liabilities consisted of the following at January 1, 2016 and January 2, 2015:


	January 1,		January 2,
	2016		2015
Accrued bonuses	$	922,000	$	1,450,000
Accrued interest		4,000		—
Paid leave bank		1,710,000		1,404,000
Compensation and payroll taxes		1,494,000		1,371,000
Accrued legal		523,000		556,000
Accrued workers’ compensation insurance		268,000		192,000
Accrued rent		169,000		149,000
Employee withholdings		942,000		637,000
Client deposits		106,000		79,000
Unvouchered accounts payable		3,061,000		4,462,000
Other		1,135,000		368,000
Total accrued liabilities	$	10,334,000	$	10,668,000

EQUITY PLANS

12 Months Ended

Jan. 01, 2016

EQUITY PLANS

EQUITY PLANS

9. EQUITY PLANS

As of January 1, 2016, the Company had two share‑based compensation plans, which are described below. The Company may no longer grant awards under the 2006 Stock Incentive Plan. The compensation expense that has been recognized for stock options issued under these plans was $777,000, $258,000 and $150,000 for fiscal years 2015, 2014 and 2013, respectively.

2006 STOCK INCENTIVE PLAN

In June 2006, the Company’s board of directors adopted the 2006 Stock Incentive Plan (“2006 Plan”) and it received stockholder approval. The Company re‑submitted the 2006 Plan to its stockholders for post‑IPO approval at the 2007 annual meeting of the stockholders and it was approved. The 2006 Plan will terminate in June 2016 and no additional awards were or will be granted under the 2006 Plan after the Company’s shareholders approved the 2008 Plan (as defined below) in June 2008. The 2006 Plan had 300,000 shares of common stock reserved for issuance to the Company’s directors, executives, officers, employees, consultants and advisors and currently has 168,500 shares of common stock reserved for issuance. Approximately 70,333 shares that were available for award grant purposes under the 2006 Plan have become available for grant under the 2008 Plan following shareholder approval of the 2008 Plan. Options granted under the 2006 Plan could be “non‑statutory stock options” which expire no more than ten years from the date of grant or “incentive stock options” as defined in Section 422 of the Internal Revenue Code of 1986, as amended. Upon exercise of non‑statutory stock options, the Company is generally entitled to a tax deduction on the exercise of the option for an amount equal to the excess over the exercise price of the fair market value of the shares at the date of exercise. The Company is generally not entitled to any tax deduction on the exercise of an incentive stock option. Through January 1, 2016, options granted, net of forfeitures and expirations, under the 2006 Plan consisted of 154,000 shares and 6,000 shares for incentive stock options and non‑statutory stock options, respectively.

2008 PERFORMANCE INCENTIVE PLAN

In March 2008, the Company’s board of directors adopted the 2008 Performance Incentive Plan (“2008 Plan”), and it received stockholder approval at the 2008 annual meeting of the stockholders in June 2008. The 2008 Plan will terminate ten years after the board of directors approved it. The 2008 Plan initially had 450,000 shares of common stock reserved for issuance (not counting any shares originally available under the 2006 Plan that “poured over.”) At the 2010 and 2012 annual meetings of the stockholders, the stockholders approved 350,000 and 500,000 share increases, respectively, to the 2008 Plan. The maximum number of shares of the Company’s common stock that may be issued or transferred pursuant to awards under the 2008 Plan can also be increased by any shares subject to stock options granted under the 2006 Plan and outstanding as of June 9, 2008 which expire, or for any reason are cancelled or terminated, after June 9, 2008 without being exercised. The 2008 Plan currently has 239,000 shares of common stock reserved for issuance. Awards authorized by the 2008 Plan include stock options, stock appreciation rights, restricted stock, stock bonuses, stock units, performance stock, and other share‑based awards. No participant may be granted an option to purchase more than 100,000 shares in any fiscal year. Options generally may not be granted with exercise prices less than fair market value at the date of grant, with vesting provisions and contractual terms determined by the compensation committee of the board of directors on a grant‑by‑grant basis. Options granted under the 2008 Plan may be “nonqualified stock options” or “incentive stock options” as defined in Section 422 of the Internal Revenue Code of 1986, as amended. The maximum term of each option shall be 10 years. Upon exercise of nonqualified stock options, the Company is generally entitled to a tax deduction on the exercise of the option for an amount equal to the excess over the exercise price of the fair market value of the shares at the date of exercise. The Company is generally not entitled to any tax deduction on the exercise of an incentive stock option. For awards other than stock options, the Company is generally entitled to a tax deduction at the time the award holder recognizes income with respect to the award equal to the amount of compensation income recognized by the award holder. Option and other awards provide for accelerated vesting if there is a change in control (as defined in the 2008 Plan) and the outstanding awards are not substituted or assumed in connection with the transaction. Through January 1, 2016, awards granted, net of forfeitures and exercises, under the 2008 Plan consisted of 629,000 shares, 176,000 shares and 38,000 shares for incentive stock options, non‑statutory stock options and restricted stock grants, respectively.

The fair value of each option is calculated using the Black‑Scholes option valuation model that uses the assumptions noted in the following table. Expected volatility is based upon historical volatility of “guideline companies” since the length of time the Company’s shares have been publicly traded is shorter than the expected or contractual term of the options. The expected term of the option, taking into account both the contractual term of the option and the effects of employees’ expected exercise and expected post‑vesting termination behavior is estimated based upon the simplified method. Under this approach, the expected term is presumed to be the mid‑point between the vesting date and the end of the contractual term. The risk‑free rate for periods within the contractual life of the option is based on the U.S. Treasury yield curve in effect at the time of grant. The assumptions are as follows:


	2015					2014					2013
Expected volatility	38	%	-	42	%	38	%	-	40	%				40	%
Expected dividends				0	%				0	%				0	%
Expected term (in years)				6					6				-	6
Risk-free rate	1.33	%	-	1.75	%	1.63	%	-	1.73	%	1.31%	%	-	1.36	%

The Company’s restricted stock awards are valued on the closing price of the Company’s common stock on the date of grant and typically vest over a two year period.

Summary of Stock Option Activity

A summary of option activity under the 2006 Plan and 2008 Plan as of January 1, 2016 and changes during the fiscal years ended January 1, 2016, January 2, 2015 and December 27, 2013 is presented below. The intrinsic value of the fully‑vested options is $2,291,000, based on the Company’s closing stock price of $8.38 on January 1, 2016.


				Weighted-
		Weighted-		Average
		Average		Remaining
		Exercise		Contractual
	Options	Price		Term (Years)
Outstanding at January 2, 2015	926,000	$	5.84	6.44
Granted	165,000		12.33	—
Exercised	(103,000)		3.72	—
Forfeited or expired	(24,000)		3.94	—
Outstanding at January 1, 2016	964,000	$	7.22	6.04
Vested at January 1, 2016	624,000	$	5.24	4.53
Exercisable at January 1, 2016	624,000	$	5.24	4.53


				Weighted-
		Weighted-		Average
		Average		Remaining
		Exercise		Contractual
	Options	Price		Term (Years)
Outstanding at December 27, 2013	978,000	$	3.95	3.35
Granted	235,000		10.23	—
Exercised	(198,000)		2.24	—
Forfeited or expired	(89,000)		2.57	—
Outstanding at January 2, 2015	926,000	$	5.84	6.44
Vested at January 2, 2015	595,000	$	4.47	4.92
Exercisable at January 2, 2015	595,000	$	4.47	4.92


				Weighted-
		Weighted-		Average
		Average		Remaining
		Exercise		Contractual
	Options	Price		Term (Years)
Outstanding at December 28, 2012	992,000	$	3.86	6.95
Granted	100,000		3.62	—
Exercised	(9,000)		1.65	—
Forfeited or expired	(105,000)		—	—
Outstanding at December 27, 2013	978,000	$	3.95	3.35
Vested at December 27, 2013	796,000	$	4.04	7.90
Exercisable at December 27, 2013	796,000	$	4.04	7.90

A summary of the status of the Company’s nonvested options and changes in nonvested options during the fiscal years ended January 1, 2016, January 2, 2015 and December 27, 2013, is presented below:


		Weighted-
		Average
		Grant-Date
	Options	Fair Value
Nonvested at January 2, 2015	331,000	$	3.37
Granted	165,000		4.92
Vested	(132,000)		3.67
Forfeited	(24,000)		3.94
Nonvested at January 1, 2016	340,000		3.77


		Weighted-
		Average
		Grant-Date
	Options	Fair Value
Nonvested at December 27, 2013	207,000	$	3.55
Granted	235,000		4.15
Vested	(108,000)		3.41
Forfeited	(3,000)		3.85
Nonvested at January 2, 2015	331,000		3.37


		Weighted-
		Average
		Grant-Date
	Options	Fair Value
Nonvested at December 28, 2012	293,000	$	1.28
Granted	100,000		3.62
Vested	(143,000)		3.17
Forfeited	(43,000)		3.33
Nonvested at December 27, 2013	207,000		3.55

Summary of Restricted Stock Activity

A summary of restricted stock activity under the 2008 Plan as of January 1, 2016 and changes during the fiscal years ended January 1, 2016 and January 2, 2015, is presented below. The intrinsic value of the fully-vested restricted stock is $354,000 and $144,000, based on the Company’s average grant date price of $13.91 and $7.13 for fiscal 2015 and 2014, respectively.


		Weighted-
		Average
	Restricted Stock	Grant Date Fair Value
Outstanding at January 2, 2015	38,000	$	5.74
Awarded	25,000		13.91
Vested	(25,000)		5.05
Forfeited	—		—
Outstanding at January 1, 2016	38,000	$	11.66

Outstanding at December 27, 2013	25,000		2.96
Awarded	25,000		7.13
Vested	(12,000)		2.96
Forfeited	—		—
Outstanding at January 2, 2015	38,000	$	5.74

The total unrecognized compensation expense related to non-vested stock options and restricted stock grants was $1,280,000 and $322,000, and $422,000 and $142,000 as of January 1, 2016 and January 2, 2015, respectively. That expense is expected to be recognized over a weighted-average period of 2.18 years. There were no options granted that were immediately vested during the fiscal years ended January 1, 2016, January 2, 2015 and December 27, 2013.

AMENDED AND RESTATED 2006 EMPLOYEE STOCK PURCHASE PLAN

The Company adopted its Amended and Restated 2006 Employee Stock Purchase Plan to allow eligible employees the right to purchase shares of common stock, at semi‑annual intervals, with their accumulated payroll deductions. The plan received stockholder approval in June 2006. The Company re‑submitted the plan to its stockholders for post‑IPO approval at the 2007 annual stockholders’ meeting where approval was obtained. A total of 300,000 shares of the Company’s common stock have been reserved for issuance under the plan, with no more than 100,000 shares being issuable in any one calendar year.

The plan has semi‑annual periods beginning on each January 1 and ending on each June 30 and beginning on each July 1 and ending on each December 31. The first offering period commenced on February 10, 2007 and ended on June 30, 2007.

Participants make contributions under the plan only by means of payroll deductions each payroll period. The accumulated contributions are applied to the purchase of shares. Shares are purchased under the plan on or as soon as practicable after, the last day of the offering period. The purchase price per share equals 95% of the fair market value of a share on the last day of such offering period.

The Company’s Amended and Restated 2006 Employee Stock Purchase Plan is a non‑compensatory plan. As a result, stock‑based compensation expense is not recognized in relation to this plan. As of January 1, 2016, there were 66,483 shares available for issuance under the plan.

DEBT OBLIGATIONS

12 Months Ended

Jan. 01, 2016

DEBT OBLIGATIONS

DEBT OBLIGATIONS

10. DEBT OBLIGATIONS

Debt obligations, excluding obligations under capital leases (note 11), consist of the following:


	2016		2015
Outstanding borrowings on delayed draw term loan	$	1,850,000	$	—
Notes payable for 360 Energy Engineers, LLC, 35 month term, bearing interest at 4%, payable in monthly principal and interest installments of $88,752 through November 2017.		2,033,000		—
Notes payable for Abacus, 24 month term, bearing interest at 4%, payable in monthly principal and interest installments of $54,281 through January 2017.		690,000		—
Notes payable for insurance, 11 month term, bearing interest at 2.773%, payable in monthly principal and interest installments of $55,868 through October 2016.		551,000		352,000
Other		—		3,000
		5,124,000		355,000
Less current portion		4,039,000		355,000
Debt obligations, less current portion	$	1,085,000	$	—

To finance the acquisitions of Abacus and 360 Energy, the Company borrowed $2.0 million under its delayed draw term loan facility pursuant to the BMO Credit Agreement described below. The term loan bears interest at the LIBOR rate plus an applicable margin ranging between 2.25% and 2.75%, set at the LIBOR rate plus 2.50% as of January 1, 2016, and matures on March 24, 2017. Interest on the term loan is payable quarterly, beginning April 13, 2015. Principal on the term loan is payable on the last day of each March, June, September and December in each year, with the amount of each such principal installment equal to: (i) $50,000 on the last day of each March, June, September and December 2016 and (ii) all of the remaining outstanding principal amount on March 24, 2017. The term loan is governed by the terms of the BMO Credit Agreement.

On January 15, 2015, in connection with the completion of the acquisition of Abacus, WES issued promissory notes to Mark Kinzer (the “Kinzer Note”) and Steve Rubbert (the “Rubbert Note” and, together with the Kinzer Note, the “Abacus Notes”). The initial outstanding principal amounts of the Kinzer Note and the Rubbert Note were $625,000 and $625,000, respectively. The Abacus Notes provide for a fixed interest rate of 4% per annum. The Abacus Notes are fully amortizing and payable in equal monthly installments between January 15, 2015 and their January 15, 2017 maturity date. The Abacus Notes contain events of default provisions customary for documents of this nature. Mr. Kinzer and Mr. Rubbert have entered into a Subordination Agreement, dated as of January 15, 2015, in favor of BMO Harris, pursuant to which any indebtedness under the Abacus Notes is subordinated to any indebtedness under the BMO Credit Agreement. Through January 1, 2016 the Company had made payments of approximately $280,000 on each of the Abacus Notes and as of January 1, 2016, the outstanding balance was $345,000 on each of the Abacus Notes.

On January 15, 2015, in connection with the completion of the acquisition of 360 Energy, WES issued a promissory note to 360 Energy (the “360 Energy Note”). The initial outstanding principal amount of the 360 Energy Note was $3,000,000. The 360 Energy Note provides for a fixed interest rate of 4% per annum. The 360 Energy Note is fully amortizing and payable in equal monthly installments between January 15, 2015 and its January 15, 2018 maturity date. The 360 Energy Note contains events of default provisions customary for documents of this nature. 360 Energy has entered into a Subordination Agreement, dated as of January 15, 2015, in favor of BMO Harris, pursuant to which any indebtedness under the 360 Energy Note is subordinated to any indebtedness under the BMO Credit Agreement. Through January 1, 2016 the Company had made payments of approximately $967,000 on the 360 Energy Note and the outstanding balance was $2,033,000 as of January 1, 2016.

BMO Credit Facility. On March 24, 2014, the Company and its subsidiaries, as guarantors, entered into a credit agreement (as amended, the “BMO Credit Agreement”) with BMO Harris Bank, N.A., or BMO, that provides for a revolving line of credit of up to $7.5 million, subject to a borrowing base calculation, and a delayed draw term loan facility of up to $3.0 million. The $7.5 million revolving credit facility includes a $5.0 million standby letter of credit sub-facility. As of January 1, 2016, there were no outstanding borrowings under the revolving line of credit and approximately $1.85 million in loans outstanding under the term loan facility and, after considering the BMO Credit Agreement’s borrowing base calculation and debt covenants (each as described below), $7.5 million under the revolving line of credit and $1.15 million under the delayed draw term loan facility were available for borrowing.

The term loan bears interest, at the Company’s option, at (a) the base rate plus an applicable margin ranging between 1.25% and 1.75%, or (b) the LIBOR rate plus an applicable margin ranging between 2.25% and 2.75%. Borrowings under the revolving line of credit bear interest, at the Company’s option, at (a) the base rate plus an applicable margin ranging between 0.75% and 1.25%, or (b) the LIBOR rate plus an applicable margin ranging between 1.75% and 2.25%. The applicable margin is determined based on the Company’s total leverage ratio. Interest on the term loan is payable quarterly, beginning April 13, 2015 and was 3.1% as of January 1, 2016. Principal on the term loan is payable on the last day of each March, June, September, and December in each year, with the amount of each such principal installment equal to: (i) $50,000 on the last day of March, June, September and December 2016, and (ii) all of the remaining outstanding principal amount on March 24, 2017. The term loan is governed by the terms of the BMO Credit Agreement.

All borrowings under the revolving line of credit are limited to a borrowing base equal to roughly 75% of the eligible accounts receivable plus 50% of the lower of cost or market value of the Company’s eligible inventory, each term as defined in the BMO Credit Agreement. Under the BMO Credit Agreement, as of January 1, 2016, no cash amounts are restricted. The revolving line of credit matures on March 24, 2017 and term loans can be requested at any time prior to February 22, 2017, which would mature March 24, 2017.

Borrowings under the delayed draw term loan facility bear Borrowings under the term loan facility and the revolving line of credit are guaranteed by all of the Company’s subsidiaries (the “Guarantors”) and secured by all of the Company’s and the Guarantors’ accounts receivable and other rights to payment, general intangibles, inventory and equipment. Pursuant to the BMO Credit Agreement, the Company also must pay a fee of up to 0.3% on unused commitments and customary fees on any letters of credit drawn under the facility.

The BMO Credit Agreement contains customary representations and affirmative covenants, including financial covenants that require the Company to maintain (i) a maximum total leverage ratio, measured as total funded debt (measured as the sum of all obligations for borrowed money, including subordinated debt, plus all capital lease obligations) plus capital leases plus financial letters of credit divided by a trailing twelve month EBITDA (as defined in the BMO Credit Agreement) measured on a rolling basis of not more than 2.25 for the first four fiscal quarters after January 2015, and not more than 2.0 thereafter; (ii) a minimum fixed charge coverage ratio (measured as the sum of EBITDA plus rent expense less unfinanced capital expenditures divided by the sum of rent expense plus principal payments plus cash taxes plus cash interest plus restricted payments plus distributions) of not less than 1.25; and (iii) a minimum tangible net worth of at least the sum of (a) the Company’s tangible net worth as of December 31, 2015, plus (b) 50% of net income (only if positive) for each fiscal quarter ending after February 29, 2016, plus (c) the aggregate proceeds received by the Company from the issuance or sale of equity interests in the Company after February 29, 2016, minus (d) the aggregate dollar amount of stock repurchases after February 29, 2016, plus or minus, as applicable, (e) 80% of any adjustments to tangible net worth of the Company arising as a result of certain acquisitions identified to BMO Harris.

The BMO Credit Agreement also includes customary negative covenants, including (i) restrictions on the incurrence of additional indebtedness by the Company or the Guarantors other than indebtedness existing on the date of the BMO Credit Agreement, (ii) restrictions on the total consideration for all permitted acquisitions (including potential future earn-out obligations) shall not exceed $1.5 million during the term of the agreement and the total consideration for any individual permitted acquisition shall not exceed $750,000 without BMO’s consent, and (iii) limitations on asset sales, mergers and acquisitions. In addition, the credit agreement includes customary events of default. Upon the occurrence of an event of default, the interest rate may be increased by 2.0%, BMO has the option to make any loans then outstanding under the BMO Credit Agreement immediately due and payable, and BMO is no longer obligated to extend further credit to us under the BMO Credit Agreement. As of March 15, 2016, the Company was in compliance with the covenants under the BMO Credit Agreement.

Insurance Premiums. The Company has also financed, from time to time, insurance premiums by entering into unsecured notes payable with insurance companies. During the Company’s annual insurance renewals in the fourth quarter of its fiscal year ended January 1, 2016, the Company elected to finance its insurance premiums for the upcoming fiscal year. The unpaid balance of the financed premiums totaled $551,000 and $352,000 for fiscal 2015 and 2014, respectively.

COMMITMENTS

12 Months Ended

Jan. 01, 2016

COMMITMENTS

COMMITMENTS

11. COMMITMENTS

Leases

The Company is obligated under capital leases for certain furniture and office equipment that expire at various dates through the year 2018.

The Company also leases certain office facilities under non‑cancelable operating leases that expire at various dates through the year 2023.

Future minimum rental payments under capital and non‑cancelable operating leases are summarized as follows:


	Capital		Operating
Fiscal year:
2016	$	456,000		2,300,000
2017		190,000		1,925,000
2018		71,000		1,338,000
2019		—		1,035,000
2020		—		558,000
Thereafter		—		1,147,000
Total future minimum lease payments		717,000	$	8,303,000
Amount representing interest (at rates ranging from 3.25% to 3.75%)		(18,000)
Present value of net minimum lease payments under capital leases		699,000
Less current portion		444,000
	$	255,000

During the fiscal year ended January 2, 2015, the Company moved certain offices to new locations and closed certain virtual offices. As a result of the office closures and relocations, the Company recorded lease abandonment expense, net, of $9,000. This expense includes future rental obligations and other costs associated with the leased space net of the fair value of subleases.

Rent expense and related charges for common area maintenance for all facility operating leases for fiscal years 2015, 2014 and 2013 was approximately $2,842,000, $3,004,000 and $3,405,000, respectively.

The following is a reconciliation of the liability for lease abandonment expense for fiscal years 2015 and 2014


	Fiscal 2015		Fiscal 2014
Liability for abandoned leases as of beginning of year	$	44,000	$	122,000
Lease abandonment expense, net		—		9,000
Lease payments on abandoned leases, net of sublease payments		(11,000)		(153,000)
Other		(33,000)		66,000
Liability for abandoned leases as of the end of the year	$	—	$	44,000

Employee Benefit Plans

The Company has a qualified profit sharing plan (the Plan) pursuant to Code Section 401(a) and qualified cash or deferred arrangement pursuant to Code Section 401(k) covering substantially all employees. Employees may elect to contribute up to 50% of compensation limited to the amount allowed by tax laws. Company contributions are made solely at the discretion of the Company’s board of directors. The Company made matching contributions of approximately $777,000, $624,000 and $507,000 during fiscal years 2015, 2014 and 2013, respectively.

The Company has a discretionary bonus plan for regional managers, division managers and others as determined by the Company president. Bonuses are awarded if certain financial goals are achieved. The financial goals are not stated in the plan; rather they are judgmentally determined each year. In addition, the board of directors may declare discretionary bonuses to key employees and all employees are eligible for what the Company refers to as the “hot hand” bonus program, which pays awards for outstanding performance. The Company’s compensation committee of the board of directors determines the compensation of the president and chief executive officer. Bonus expense for fiscal years 2015, 2014 and 2013 totaled approximately $1,268,000, $1,500,000 and $262,000, respectively, of which approximately $922,000 and $1,450,000 is included in accrued liabilities at January 1, 2016 and January 2, 2015, respectively.

Post employment health benefits

In May 2006, the Company’s board of directors approved providing lifetime health insurance coverage for Win Westfall, the Company’s former chief executive officer and current chairman of the board of directors, and his spouse and for Linda Heil, the widow of the Company’s former chief executive officer, Dan Heil. These benefits relate to past services provided to the Company. Accordingly, there is no unamortized compensation cost for the benefits.

Included in accrued liabilities in the accompanying consolidated balance sheets related to this obligation is the present value of expected payments for health insurance coverage, $126,000 as of January 1, 2016 and $139,000 as of January 2, 2015.

INCOME TAXES

12 Months Ended

Jan. 01, 2016

INCOME TAXES

INCOME TAXES

12. INCOME TAXES

The provision (benefit) for income taxes is comprised of:


	Fiscal Year
	2015		2014		2013
Current federal taxes	$	983,000	$	274,000	$	88,000
Current state taxes		340,000		164,000		44,000
Deferred federal taxes (benefit)		1,295,000		(782,000)		—
Deferred state taxes (benefit)		464,000		(646,000)		—
	$	3,082,000	$	(990,000)	$	132,000

The provision (benefit) for income taxes reconciles to the amounts computed by applying the statutory federal tax rate of 34% to our income (loss) before income taxes. The sources and tax effects of the differences for fiscal years 2015, 2014 and 2013 are as follows:


	2015		2014		2013
Computed “expected” federal income tax expense (benefit)	$	2,496,000	$	2,864,000	$	940,000
Permanent differences		90,000		139,000		93,000
Incentive stock options		205,000		—		—
Energy efficient commercial building deduction		(281,000)		—		—
Current and deferred state income tax expense (benefit), net of federal benefit		482,000		586,000		(19,000)
Change in valuation allowances on deferred tax assets		73,000		(4,576,000)		(897,000)
Other		17,000		(3,000)		15,000
	$	3,082,000	$	(990,000)	$	132,000

Differences between the Company’s effective income tax rate and what would be expected if the federal statutory rate was applied to income before income tax from continuing operations are primarily due to permanent tax adjustments such as incentive stock options which are not deductible for federal or state income tax purposes, energy efficient commercial building deduction, and a valuation allowance adjustment related to state net operating losses not expected to be utilized.

The tax effects of temporary differences that give rise to significant portions of the net deferred tax assets and liabilities are as follows:


	January 1,		January 2,		December 27,
	2016		2015		2013
Deferred tax assets:
Accounts receivable allowance	$	303,000	$	265,000	$	156,000
Other accrued liabilities		1,618,000		1,482,000		764,000
Federal and state net operating losses		156,000		244,000		3,157,000
Intangible assets		3,891,000		4,016,000		4,571,000
Other		224,000		409,000		64,000
		6,192,000		6,416,000		8,712,000
Valuation allowance		(73,000)		—		(4,576,000)
Net deferred tax assets		6,119,000		6,416,000		4,136,000
Deferred tax liabilities:
Deferred revenue		(5,510,000)		(4,878,000)		(4,125,000)
Fixed assets		(696,000)		(111,000)		(11,000)
Other		(244,000)		—		—
		(6,450,000)		(4,989,000)		(4,136,000)
Net deferred tax (liability) asset	$	(331,000)	$	1,427,000	$	—

At January 1, 2016, the Company had state operating loss carryovers of $2.8 million. The carryovers expire through 2035.

During 2015 management assessed the available positive and negative evidence to estimate if sufficient future taxable income will be generated to utilize the existing deferred tax assets. Management has ultimately determined that it is not more-likely-than-not that the entire California net operating loss will be utilized prior to expiration. Significant pieces of objective evidence evaluated included the Company’s utilization of California net operating losses in prior years for each of its subsidiaries. Based on this evaluation, as of January 1, 2016, the Company recorded a valuation allowance in the amount of $73,000 related to California net operating losses. With the exception of the valuation allowance on the California net operating loss carryforward, management believes that it is more likely than not that the deferred tax assets at January 1, 2016 will be realized.

In November 2015, the FASB issued ASU 2015-17, Balance Sheet Classification of Deferred Taxes to simplify the presentation of deferred income taxes. The amendments in this update require that deferred tax liabilities and assets be classified as noncurrent in a classified statement of financial position. The Company has elected to early adopt ASU 2015-17 as of January 1, 2016 and retrospectively applied ASU 2015-17 to all periods presented. As of January 2, 2015 the Company reclassified $3.1 million of deferred tax liabilities from "Current liabilities" to "Non-current assets" on the Consolidated Balance Sheets.

During the year ended January 2, 2015 management assessed the available positive and negative evidence to estimate if sufficient future taxable income will be generated to utilize the existing deferred tax assets. Significant pieces of objective positive evidence evaluated were the cumulative earnings generated over the three-year period ended January 2, 2015 and the Company's strong future earnings projections. Based on this evaluation, as of January 2, 2015, the Company reversed $4.6 million of its valuation allowance.

Management believes that there are no material uncertain tax positions that would impact the accompanying consolidated financial statements. The Company's policy is to recognize interest and penalties related to unrecognized tax benefits in income tax expense. As of January 1, 2016 and January 2, 2015, there was no unrecognized tax benefit. The Company may be subject to examination by the Internal Revenue Service for calendar years 2012 through 2015. The Company may also be subject to examination on certain state and local jurisdictions for the years 2011 through 2015.

SEGMENT INFORMATION

12 Months Ended

Jan. 01, 2016

SEGMENT INFORMATION

SEGMENT INFORMATION

13. SEGMENT INFORMATION

The Company has four reporting segments: Energy Efficiency Services, Engineering Services, Public Finance Services and Homeland Security Services. The Engineering Services segment consists of Willdan Engineering and Public Agency Resources. The Energy Efficiency Services segment, which consists of Willdan Energy Solutions, provides energy efficiency consulting services to utilities, state agencies, municipalities, private industry and non-profit organizations. The Engineering Services segment offers a broad range of engineering and planning services to our public and private sector clients. The Public Finance Services segment, which consists of Willdan Financial Services, provides expertise and support for the various financing techniques employed by public agencies to finance their operations and infrastructure along with the mandated reporting and other requirements associated with these financings. The Homeland Security Services segment, which consists of Willdan Homeland Solutions, provides national preparedness, homeland security consulting, public safety and emergency response services to cities, related municipal service agencies and other entities.

The accounting policies applied to determine the segment information are the same as those described in the summary of significant accounting policies. There were no intersegment sales in any of the three fiscal years ended January 1, 2016. Management evaluates the performance of each segment based upon income or loss from operations before income taxes. Certain segment asset information including expenditures for long‑lived assets has not been presented as it is not reported to or reviewed by the chief operating decision maker. In addition, enterprise‑wide service line contract revenue is not included as it is impracticable to report this information for each group of similar services.

Financial information with respect to the reportable segments and reconciliation to the amounts reported in the Company’s consolidated financial statements follows:


			Energy		Public		Homeland
	Engineering		Efficiency		Finance		Security		Unallocated				Consolidated
	Services		Services		Services		Services		Corporate		Intersegment		Total
Fiscal Year 2015
Contract revenue	$	45,997,000	$	74,123,000	$	11,857,000	$	3,126,000	$	—	$	—	$	135,103,000
Depreciation and amortization		359,000		1,525,000		159,000		29,000		—		—		2,072,000
Interest (expense) income		(10,000)		(194,000)		(2,000)		(1,000)		—		—		(207,000)
Segment profit (loss) before income tax expense		4,666,000		2,499,000		1,148,000		418,000		(1,390,000)		—		7,341,000
Income tax (benefit) expense		1,959,000		1,049,000		482,000		176,000		(584,000)		—		3,082,000
Net income (loss)		2,707,000		1,450,000		666,000		242,000		(806,000)		—		4,259,000
Segment assets(1)		13,641,000		34,686,000		5,377,000		894,000		40,877,000		(23,130,000)		72,345,000
Fiscal Year 2014
Contract revenue	$	40,783,000	$	52,941,000	$	10,630,000	$	3,726,000	$	—	$	—	$	108,080,000
Depreciation and amortization		191,000		212,000		39,000		18,000		—				459,000
Interest (expense) income		17,000		(33,000)		2,000		(2,000)		—				(16,000)
Segment profit (loss) before income tax expense		4,008,000		4,814,000		661,000		443,000		(1,500,000)		—		8,426,000
Income tax (benefit) expense		(454,000)		(599,000)		(64,000)		(49,000)		176,000		—		(990,000)
Net income (loss)		4,462,000		5,413,000		725,000		492,000		(1,676,000)		—		9,416,000
Segment assets(1)		11,166,000		11,769,000		3,944,000		708,000		44,873,000		(23,130,000)		49,330,000
Fiscal Year 2013
Contract revenue	$	35,217,000	$	36,041,000	$	9,845,000	$	4,407,000	$	—	$	—	$	85,510,000
Depreciation and amortization		214,000		223,000		41,000		39,000		—		—		517,000
Interest (expense) income		(68,000)		(25,000)		(3,000)		2,000		—		—		(94,000)
Segment profit before income tax expense		1,125,000		710,000		535,000		392,000		—		—		2,762,000
Income tax expense (benefit)		53,000		45,000		17,000		17,000		—		—		132,000
Net income		1,072,000		665,000		518,000		375,000		—		—		2,630,000
Segment assets(1)		10,436,000		10,305,000		3,528,000		1,406,000		35,692,000		(23,130,000)		38,237,000

(1)

Segment assets are presented net of intercompany receivables.

(2)

The following sets forth the assets that are included in Unallocated Corporate as of January 1, 2016, January 2, 2015 and December 27, 2013.


	2015		2014		2013
Assets:
Cash and cash equivalents	$	14,385,000	$	20,371,000	$	7,341,000
Prepaid expenses		758,000		1,404,000		1,206,000
Intercompany receivables		82,845,000		85,259,000		114,800,000
Other receivables		49,000		19,000		73,000
Equipment and leasehold improvements, net		2,231,000		440,000		177,000
Investments in subsidiaries		23,130,000		23,130,000		23,130,000
Other		53,000		4,640,000		3,765,000
	$	123,451,000	$	135,263,000	$	150,492,000

- Definition

The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
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Reference 2: http://www.xbrl.org/2003/role/presentationRef
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-Name Accounting Standards Codification
-Topic 280
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Reference 3: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
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Reference 4: http://www.xbrl.org/2003/role/presentationRef
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Reference 5: http://www.xbrl.org/2003/role/presentationRef
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Reference 6: http://www.xbrl.org/2003/role/presentationRef
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Reference 7: http://www.xbrl.org/2003/role/presentationRef
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-URI http://asc.fasb.org/extlink&oid=51669610&loc=d3e8844-108599

Reference 8: http://www.xbrl.org/2003/role/presentationRef
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-Name Accounting Standards Codification
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Reference 9: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
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-URI http://asc.fasb.org/extlink&oid=51669610&loc=d3e9031-108599

Reference 10: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 42
-URI http://asc.fasb.org/extlink&oid=51669610&loc=d3e9054-108599

Reference 11: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
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Reference 12: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
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Reference 13: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
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-URI http://asc.fasb.org/extlink&oid=51669610&loc=d3e8924-108599

Reference 14: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
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-Section 50
-Paragraph 30
-URI http://asc.fasb.org/extlink&oid=51669610&loc=d3e8906-108599

+ Details

CONTINGENCIES	12 Months Ended
CONTINGENCIES	Jan. 01, 2016
CONTINGENCIES
CONTINGENCIES	14. CONTINGENCIES Claims and Lawsuits The Company is subject to claims and lawsuits from time to time, including those alleging professional errors or omissions that arise in the ordinary course of business against firms that operate in the engineering and consulting professions. The Company carries professional liability insurance, subject to certain deductibles and policy limits, for such claims as they arise and may from time to time establish reserves for litigation that is considered probable of a loss. In accordance with accounting standards regarding loss contingencies, the Company accrues an undiscounted liability for those contingencies where the incurrence of a loss is probable and the amount can be reasonably estimated, and discloses the amount accrued and an estimate of any reasonably possible loss in excess of the amount accrued, if such disclosure is necessary for the Company’s financial statements not to be misleading. The Company does not accrue liabilities when the likelihood that the liability has been incurred is probable but the amount cannot be reasonably estimated, or when the liability is believed to be only reasonably possible or remote. Because litigation outcomes are inherently unpredictable, the Company’s evaluation of legal proceedings often involves a series of complex assessments by management about future events and can rely heavily on estimates and assumptions. If the assessments indicate that loss contingencies that could be material to any one of the Company’s financial statements are not probable, but are reasonably possible, or are probable, but cannot be estimated, then the Company will disclose the nature of the loss contingencies, together with an estimate of the possible loss or a statement that such loss is not reasonably estimable. While the consequences of certain unresolved proceedings are not presently determinable, and a reasonable estimate of the probable and reasonably possible loss or range of loss in excess of amounts accrued for such proceedings cannot be made, an adverse outcome from such proceedings could have a material adverse effect on the Company’s earnings in any given reporting period. However, in the opinion of the Company’s management, after consulting with legal counsel, and taking into account insurance coverage, the ultimate liability related to current outstanding claims and lawsuits is not expected to have a material adverse effect on the Company’s financial statements. City of Glendale v. Willdan Financial Services, Superior Court of California, Los Angeles County A complaint was filed against the Company on July 16, 2014 relating to a project performed by Willdan Financial Services to prepare a Cost of Services Analysis (a “COSA”) for the Department of Water and Power of the City of Glendale, California (the “City of Glendale”). The purpose of the COSA was to assist the City of Glendale in setting water rates for property owners. The lawsuit alleges that the City of Glendale suffered damages due to mistakes in the COSA, as follows: the City of Glendale received less revenue than anticipated in an amount exceeding $9,000,000; the City of Glendale was required to retain another consultant to prepare a new COSA at the cost of $130,000; and the City of Glendale incurred costs associated with noticing and conducting public hearings at a cost of $83,052. The Company denies the allegations asserted in the lawsuit and will vigorously defend against the claims. Additionally, this matter is covered under the Company’s professional liability insurance policy which has limits of $5,000,000 per claim and $10,000,000 annual aggregate.

QUARTERLY FINANCIAL INFORMATION (UNAUDITED)

12 Months Ended

Jan. 01, 2016

QUARTERLY FINANCIAL INFORMATION (UNAUDITED)

QUARTERLY FINANCIAL INFORMATION (UNAUDITED)

15. QUARTERLY FINANCIAL INFORMATION (UNAUDITED)

The tables below reflect selected quarterly information for the fiscal years ended January 1, 2016 and January 2, 2015.


	Fiscal Three Months Ended
	April 3,		July 3,		October 2,		January 1,
	2015		2015		2015		2016
	(in thousands except per share amounts)
Contract revenue	$	33,297	$	36,773	$	33,511	$	31,522
Income from operations		2,629		2,804		1,641		456
Income tax expense		1,138		1,108		626		210
Net income		1,495		1,602		782		380
Earnings per share:
Basic	$	0.19	$	0.20	$	0.10	$	0.05
Diluted	$	0.18	$	0.20	$	0.10	$	0.05
Weighted-average shares outstanding:
Basic		7,765		7,824		7,862		7,888
Diluted		8,103		8,136		8,102		8,132


	Fiscal Three Months Ended
	March 28,		June 27,		September 26,		January 2,
	2014		2014		2014		2015
	(in thousands except per share amounts)
Contract revenue	$	22,686	$	26,970	$	28,187	$	30,237
Income from operations		1,312		1,941		2,651		2,405
Income tax expense (benefit)		44		64		(1,464)		366
Net income		1,315		1,893		4,161		2,047
Earnings per share:
Basic	$	0.18	$	0.26	$	0.55	$	0.27
Diluted	$	0.17	$	0.25	$	0.53	$	0.26
Weighted-average shares outstanding:
Basic		7,397		7,405		7,507		7,618
Diluted		7,609		7,661		7,855		7,986

In the fourth quarter of fiscal 2015, the Company recorded measurement period adjustments for changes in its acquisition accounting (see Note 3). Included in these adjustments is a decrease in direct costs of contract revenue related to the identification of a pre-existing liability as of the acquisition date of $512,000 that should have been recorded in the second quarter.

SUBSEQUENT EVENTS	12 Months Ended
SUBSEQUENT EVENTS	Jan. 01, 2016
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS	16. SUBSEQUENT EVENTS Acquisition of Genesys Engineering P.C. On March 4, 2016, following the Company’s acquisitions in January 2015 of Abacus Resource Management and 360 Energy Engineers, LLC, the Company and the Company’s wholly-owned subsidiary, Willdan Energy Solutions (“WES”) acquired substantially all of the assets of Genesys Engineering P.C. (“Genesys”) and assumed certain specified liabilities of Genesys (collectively, the “Purchase”) pursuant to an Asset Purchase and Merger Agreement, dated as of February 26, 2016 (the “Agreement”), by and among the Company, WES, WESGEN (as defined below), Genesys and Ronald W. Mineo (“Mineo”) and Robert J. Braun (“Braun” and, together with Mineo, the “Genesys Shareholders”). On March 5, 2016, pursuant to the terms of the Agreement, WESGEN, Inc., a non-affiliated corporation (“WESGEN”), merged (the “Merger” and, together with the Purchase, the “Acquisition”) with Genesys, with Genesys remaining as the surviving corporation. Pursuant to the terms of the Agreement, WES or WESGEN, as applicable, paid the Genesys Shareholders an aggregate purchase price (the “Purchase Price”) of approximately $12.6 million, subject to post closing working capital and tax adjustments. The Purchase Price consists of (i) $6.0 million in cash, payable at closing, (ii) 255,808 shares of Common Stock, par value $0.01 per share, of the Company (the “Common Stock”), equaling $2.0 million based on the volume-weighted average price of shares of the Common Stock for the ten trading days immediately prior to, but not including, February 26, 2016, and (iii) $4.6 million in cash, payable in twenty-four (24) equal monthly installments beginning on March 26, 2016 (the “Installment Payments”). Until the third anniversary of the Closing Date (the “Closing Date”), the Genesys Shareholders will be prohibited from transferring or disposing of any Common Stock received in connection with the Acquisition. The Agreement contains customary representations and warranties regarding the Company, WES, WESGEN, Genesys and the Genesys Shareholders, indemnification provisions and other provisions customary for transactions of this nature. Pursuant to the terms of the Agreement, the Company and WES also provided guarantees to the Genesys Shareholders which guarantee certain of WESGEN’s and Genesys’ obligations under the Agreement, including the Installment Payments. The Company used cash on hand to pay the $6.0 million initial purchase price. Genesys continues to be a professional corporation organized under the laws of the State of New York, wholly-owned by one or more licensed engineers. Pursuant to New York law, the Company does not own capital stock of Genesys. The Company has entered into an agreement with the post-Closing Date owners of Genesys pursuant to which such owners will be prohibited from selling, transferring or encumbering their ownership interest in Genesys without the Company’s consent. Notwithstanding the Company’s rights regarding the transfer of Genesys’ stock, the Company does not have control over the professional decision making of Genesys. The Company has entered into an administrative services agreement with Genesys pursuant to which WES will provide Genesys with ongoing administrative, operational and other non-professional support services. Amendment to Credit Facility. On February 26, 2016, the Company and the Company’s subsidiaries, as guarantors, entered into the Third Amendment (the “Third Amendment”) to the Credit Agreement and Consent (as amended, the “BMO Credit Agreement”), dated as of March 24, 2014, by and between the Company, the guarantors listed therein, and BMO Harris Bank National Association (“BMO Harris”). The BMO Credit Agreement governs the Company’s credit facility that includes a revolving line of credit and a delayed draw term loan facility. The Third Amendment revised the BMO Credit Agreement to, among other things, extend the maturity date of the BMO Credit Agreement from March 24, 2016 to March 24, 2017, to permit the Acquisition and the Installment Payments and to add Genesys as a guarantor under the BMO Credit Agreement upon the closing of the Merger. The Third Amendment also permits the Company to repurchase up to $7.0 million of shares of Common Stock under certain conditions, including that, at the time of any such repurchase, (a) the Company has at least $7.0 million of unrestricted cash (or undrawn availability under the Company’s revolving credit facility), (b) the aggregate amount of all repurchases to the date of such repurchase be less than $7.0 million and (c) no default exists or would arise under the BMO Credit Agreement after giving effect to such repurchase. The Third Amendment also revised certain covenants in the BMO Credit Agreement. As a result of the Third Amendment, the Company must maintain a minimum tangible net worth (as defined in the Third Amendment) of at least the sum of (a) the Company’s tangible net worth as of December 31, 2015, plus (b) 50% of net income (only if positive) for each fiscal quarter ending after the effectiveness of the Third Amendment, plus (c) the aggregate proceeds received by the Company from the issuance or sale of equity interests in the Company, minus (d) the aggregate dollar amount of stock repurchases after the effectiveness of the Third Amendment, plus or minus, as applicable, (e) 80% of any adjustments to tangible net worth of the Company arising as a result of the consummation of the Acquisition or certain other acquisitions identified to BMO Harris. Pursuant to the terms of the Third Amendment, the Company’s ability to incur permitted indebtedness was also (i) decreased for notes to sellers of acquired businesses from $4.25 million to $4.15 million and (ii) increased for cash earn out, performance payments or similar obligations relating to acquisitions permitted by the BMO Credit Agreement from $7.9 million to $10.5 million. The Third Amendment also allows the Company to incur permitted indebtedness relating to the Installment Payments up to a maximum of $4.6 million and subject to other conditions. As of March 15, 2016, there are no outstanding borrowings under the revolving line of credit and all $7.5 million remain available for borrowing.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)

12 Months Ended

Jan. 01, 2016

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Principles of Consolidation

Fiscal Years

Cash, Cash Equivalents and Liquid Investments

All highly liquid investments purchased with a remaining maturity of three months or less are considered to be cash equivalents. Cash and cash equivalents consisted of the following:


	January 1,		January 2,
	2016		2015
BMO Harris Bank Master Control Operating Account	$	16,438,000	$	18,119,000
Cash on hand in business checking accounts		49,000		54,000
	$	16,487,000	$	18,173,000

Fair Value of Financial Instruments

Segment Information

Off-Balance Sheet Arrangements

Off‑Balance Sheet Arrangements

Accounting for Contracts


	Types of Contract
Segment	(Revenue Recognition Method)
Energy Efficiency Services	Unit-based and time-and-materials (percentage-of-completion method)
Engineering Services	Time-and-materials, unit-based and fixed price (percentage-of-completion method)
Public Finance Services	Service related contracts (proportional performance method)
Homeland Security Services	Service related contracts (proportional performance method)

General and Administrative Expenses

current and expected conditions and its expected course of action. Differences between the Company's estimates and actual results often occur resulting in changes to reported revenue and earnings. Such changes could have a material effect on future consolidated financial statements. The Company did not have material revisions in estimates for contracts recognized using the percentage-of-completion method for any of the periods presented in the accompanying condensed consolidated financial statements.

General and Administrative Expenses

Leases

Equipment and Leasehold Improvements

Following are the estimated useful lives used to calculate depreciation and amortization:


Category	Estimated Useful Life
Furniture and fixtures	5	years
Computer hardware	2	years
Computer software	3	years
Automobiles and trucks	3	years
Field equipment	5	years

Long-lived assets

Goodwill

Accounting for Claims Against the Company

Stock Options

Business Combinations

Income Taxes

Operating Cycle

In accordance with industry practice, amounts realizable and payable under contracts that extend beyond one year are included in current assets and liabilities.

Use of Estimates

Reclassifications

Certain prior year amounts have been reclassified for consistency with the current period presentation. These reclassifications had no effect on the reported results of operations.

New Accounting Pronouncements

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)

12 Months Ended

Jan. 01, 2016

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Schedule of cash and cash equivalents


	January 1,		January 2,
	2016		2015
BMO Harris Bank Master Control Operating Account	$	16,438,000	$	18,119,000
Cash on hand in business checking accounts		49,000		54,000
	$	16,487,000	$	18,173,000

Schedule of the estimated useful lives used to calculate depreciation and amortization


Category	Estimated Useful Life
Furniture and fixtures	5	years
Computer hardware	2	years
Computer software	3	years
Automobiles and trucks	3	years
Field equipment	5	years

BUSINESS COMBINATIONS (Tables)

12 Months Ended

Jan. 01, 2016

BUSINESS COMBINATIONS

Schedule of consideration for the acquisitions


	360 Energy		Abacus		Economists, LLC		Total

Cash paid	$	4,875,000	$	3,136,000	$	490,000	$	8,501,000
Issuance of common stock		571,000		913,000		—		1,484,000
Issuance of notes payable		3,000,000		1,250,000		—		4,250,000
Contingent consideration		4,221,000		589,000		368,000		5,178,000
Total consideration	$	12,667,000	$	5,888,000	$	858,000	$	19,413,000

Schedule of preliminary amounts for the acquired assets recorded at their estimated fair value as of the acquisition date


	360 Energy		Abacus		Economists, LLC		Total

Cash acquired	$	—	$	332,000	$	—	$	332,000
Property, plant and equipment		166,000		78,000		—		244,000
Liabilities		—		(512,000)		—		(512,000)
License to bid		—		308,000		—		308,000
Backlog		158,000		161,000		29,000		348,000
Tradename		669,000		323,000		57,000		1,049,000
Non-compete agreements		860,000		128,000		23,000		1,011,000
Other assets, net		41,000		495,000		—		536,000
Goodwill		10,773,000		4,575,000		749,000		16,097,000
Net assets acquired	$	12,667,000	$	5,888,000	$	858,000	$	19,413,000

Schedule of unaudited pro forma financial information


	Year Ended
	January 1,		January 2,
In thousands (except per share data)	2016		2015
Pro forma revenue	$	135,576	$	130,181

Pro forma income from operations		8,204		12,162
Pro forma net income	$	4,759	$	12,162

Earnings per share:
Basic	$	0.61	$	1.62
Diluted	$	0.59	$	1.57

Weighted average shares outstanding:
Basic		7,834		7,488
Diluted		8,113		7,739

GOODWILL AND OTHER INTANGIBLE ASSETS (Tables)

12 Months Ended

Jan. 01, 2016

GOODWILL AND OTHER INTANGIBLE ASSETS

Schedule of changes in carrying value of goodwill by reporting unit


			Additional		Final
	January 2,		Purchase		Fair Value				January 1,
	2015		Cost		Adjustment		Impairment		2016

Reporting Unit:
Energy Efficiency Solutions	$	—	$	15,348,000	$	—	$	—	$	15,348,000
Public Finance Services		—		749,000		—		—		749,000
	$	—	$	16,097,000	$	—	$	—	$	16,097,000

Schedule of gross amounts and accumulated amortization of the Company's acquired identifiable intangible assets with finite useful lives


	January 1, 2016				January 2, 2015
	Gross		Accumulated		Gross		Accumulated		Amortization
	Amount		Amortization		Amount		Amortization		Period (yrs)
Backlog	$	348,000	$	340,000	$	—	$	—	1
Tradename		1,049,000		329,000		—		—	2.5 - 3.5
Non-compete agreements		1,011,000		194,000		—		—	4 - 5
License to bid		308,000		308,000		—		—	1
	$	2,716,000	$	1,171,000	$	—	$	—

Schedule of estimated amortization expense for acquired identifiable intangible assets


Fiscal year:
2016	$	553,000
2017		475,000
2018		306,000
2019		202,000
2020		9,000
	$	1,545,000

EARNINGS PER SHARE ("EPS") (Tables)

12 Months Ended

Jan. 01, 2016

EARNINGS PER SHARE (EPS)

Schedule of number of weighted-average shares used to compute basic and diluted EPS


	Fiscal Year

	2015		2014		2013
Net income	$	4,259,000	$	9,416,000	$	2,630,000
Weighted-average common shares outstanding		7,834,000		7,488,000		7,355,000
Effect of dilutive stock options and restricted stock awards		279,000		251,000		140,000
Weighted-average common stock outstanding-diluted		8,113,000		7,739,000		7,495,000
Earnings per share:
Basic	$	0.54	$	1.26	$	0.36
Diluted	$	0.52	$	1.22	$	0.35

ACCOUNTS RECEIVABLE (Tables)

12 Months Ended

Jan. 01, 2016

ACCOUNTS RECEIVABLE

Schedule of accounts receivable


	January 1,		January 2,
	2016		2015
Billed	$	17,941,000	$	13,151,000
Unbilled		13,840,000		12,170,000
Contract retentions		748,000		700,000
		32,529,000		26,021,000
Allowance for doubtful accounts		(760,000)		(662,000)
	$	31,769,000	$	25,359,000

Schedule of the movements in the allowance for doubtful accounts


	Fiscal Year
	2015		2014		2013
Balance as of the beginning of the year	$	662,000	$	385,000	$	303,000
Provision for doubtful accounts		586,000		486,000		189,000
Write-offs of uncollectible accounts		(488,000)		(209,000)		(107,000)
Recoveries of accounts written off		—		—		—
Balance as of the end of the year	$	760,000	$	662,000	$	385,000

EQUIPMENT AND LEASEHOLD IMPROVEMENTS (Tables)

12 Months Ended

Jan. 01, 2016

EQUIPMENT AND LEASEHOLD IMPROVEMENTS

Schedule of equipment and leasehold improvements


	January 1,		January 2,
	2016		2015
Furniture and fixtures	$	2,270,000	$	2,994,000
Computer hardware and software		6,496,000		5,667,000
Leasehold improvements		1,072,000		785,000
Equipment under capital leases		1,266,000		919,000
Automobiles, trucks, and field equipment		984,000		677,000
		12,088,000		11,042,000
Accumulated depreciation and amortization		(8,404,000)		(9,658,000)
Equipment and leasehold improvements, net	$	3,684,000	$	1,384,000

ACCRUED LIABILITIES (Tables)

12 Months Ended

Jan. 01, 2016

ACCRUED LIABILITIES

Schedule of accrued liabilities


	January 1,		January 2,
	2016		2015
Accrued bonuses	$	922,000	$	1,450,000
Accrued interest		4,000		—
Paid leave bank		1,710,000		1,404,000
Compensation and payroll taxes		1,494,000		1,371,000
Accrued legal		523,000		556,000
Accrued workers’ compensation insurance		268,000		192,000
Accrued rent		169,000		149,000
Employee withholdings		942,000		637,000
Client deposits		106,000		79,000
Unvouchered accounts payable		3,061,000		4,462,000
Other		1,135,000		368,000
Total accrued liabilities	$	10,334,000	$	10,668,000

EQUITY PLANS (Tables)

12 Months Ended

Jan. 01, 2016

EQUITY PLANS

Schedule of assumptions


	2015					2014					2013
Expected volatility	38	%	-	42	%	38	%	-	40	%				40	%
Expected dividends				0	%				0	%				0	%
Expected term (in years)				6					6				-	6
Risk-free rate	1.33	%	-	1.75	%	1.63	%	-	1.73	%	1.31%	%	-	1.36	%

Summary of option activity and changes during the period


				Weighted-
		Weighted-		Average
		Average		Remaining
		Exercise		Contractual
	Options	Price		Term (Years)
Outstanding at January 2, 2015	926,000	$	5.84	6.44
Granted	165,000		12.33	—
Exercised	(103,000)		3.72	—
Forfeited or expired	(24,000)		3.94	—
Outstanding at January 1, 2016	964,000	$	7.22	6.04
Vested at January 1, 2016	624,000	$	5.24	4.53
Exercisable at January 1, 2016	624,000	$	5.24	4.53


				Weighted-
		Weighted-		Average
		Average		Remaining
		Exercise		Contractual
	Options	Price		Term (Years)
Outstanding at December 27, 2013	978,000	$	3.95	3.35
Granted	235,000		10.23	—
Exercised	(198,000)		2.24	—
Forfeited or expired	(89,000)		2.57	—
Outstanding at January 2, 2015	926,000	$	5.84	6.44
Vested at January 2, 2015	595,000	$	4.47	4.92
Exercisable at January 2, 2015	595,000	$	4.47	4.92


				Weighted-
		Weighted-		Average
		Average		Remaining
		Exercise		Contractual
	Options	Price		Term (Years)
Outstanding at December 28, 2012	992,000	$	3.86	6.95
Granted	100,000		3.62	—
Exercised	(9,000)		1.65	—
Forfeited or expired	(105,000)		—	—
Outstanding at December 27, 2013	978,000	$	3.95	3.35
Vested at December 27, 2013	796,000	$	4.04	7.90
Exercisable at December 27, 2013	796,000	$	4.04	7.90

Summary of the status of the nonvested options and changes in nonvested options


		Weighted-
		Average
		Grant-Date
	Options	Fair Value
Nonvested at January 2, 2015	331,000	$	3.37
Granted	165,000		4.92
Vested	(132,000)		3.67
Forfeited	(24,000)		3.94
Nonvested at January 1, 2016	340,000		3.77


		Weighted-
		Average
		Grant-Date
	Options	Fair Value
Nonvested at December 27, 2013	207,000	$	3.55
Granted	235,000		4.15
Vested	(108,000)		3.41
Forfeited	(3,000)		3.85
Nonvested at January 2, 2015	331,000		3.37


		Weighted-
		Average
		Grant-Date
	Options	Fair Value
Nonvested at December 28, 2012	293,000	$	1.28
Granted	100,000		3.62
Vested	(143,000)		3.17
Forfeited	(43,000)		3.33
Nonvested at December 27, 2013	207,000		3.55

Summary of restricted stock activity


		Weighted-
		Average
	Restricted Stock	Grant Date Fair Value
Outstanding at January 2, 2015	38,000	$	5.74
Awarded	25,000		13.91
Vested	(25,000)		5.05
Forfeited	—		—
Outstanding at January 1, 2016	38,000	$	11.66

Outstanding at December 27, 2013	25,000		2.96
Awarded	25,000		7.13
Vested	(12,000)		2.96
Forfeited	—		—
Outstanding at January 2, 2015	38,000	$	5.74

DEBT OBLIGATIONS (Tables)

12 Months Ended

Jan. 01, 2016

DEBT OBLIGATIONS

Schedule of debt obligations, excluding obligations under capital leases


	2016		2015
Outstanding borrowings on delayed draw term loan	$	1,850,000	$	—
Notes payable for 360 Energy Engineers, LLC, 35 month term, bearing interest at 4%, payable in monthly principal and interest installments of $88,752 through November 2017.		2,033,000		—
Notes payable for Abacus, 24 month term, bearing interest at 4%, payable in monthly principal and interest installments of $54,281 through January 2017.		690,000		—
Notes payable for insurance, 11 month term, bearing interest at 2.773%, payable in monthly principal and interest installments of $55,868 through October 2016.		551,000		352,000
Other		—		3,000
		5,124,000		355,000
Less current portion		4,039,000		355,000
Debt obligations, less current portion	$	1,085,000	$	—

COMMITMENTS (Tables)

12 Months Ended

Jan. 01, 2016

COMMITMENTS

Summary of future minimum rental payments under capital and non-cancelable operating leases


	Capital		Operating
Fiscal year:
2016	$	456,000		2,300,000
2017		190,000		1,925,000
2018		71,000		1,338,000
2019		—		1,035,000
2020		—		558,000
Thereafter		—		1,147,000
Total future minimum lease payments		717,000	$	8,303,000
Amount representing interest (at rates ranging from 3.25% to 3.75%)		(18,000)
Present value of net minimum lease payments under capital leases		699,000
Less current portion		444,000
	$	255,000

Schedule of reconciliation of the liability for lease abandonment expense


	Fiscal 2015		Fiscal 2014
Liability for abandoned leases as of beginning of year	$	44,000	$	122,000
Lease abandonment expense, net		—		9,000
Lease payments on abandoned leases, net of sublease payments		(11,000)		(153,000)
Other		(33,000)		66,000
Liability for abandoned leases as of the end of the year	$	—	$	44,000

INCOME TAXES (Tables)

12 Months Ended

Jan. 01, 2016

INCOME TAXES

Schedule of provision (benefit) for income taxes


	Fiscal Year
	2015		2014		2013
Current federal taxes	$	983,000	$	274,000	$	88,000
Current state taxes		340,000		164,000		44,000
Deferred federal taxes (benefit)		1,295,000		(782,000)		—
Deferred state taxes (benefit)		464,000		(646,000)		—
	$	3,082,000	$	(990,000)	$	132,000

Schedule of sources and tax effects of the differences


	2015		2014		2013
Computed “expected” federal income tax expense (benefit)	$	2,496,000	$	2,864,000	$	940,000
Permanent differences		90,000		139,000		93,000
Incentive stock options		205,000		—		—
Energy efficient commercial building deduction		(281,000)		—		—
Current and deferred state income tax expense (benefit), net of federal benefit		482,000		586,000		(19,000)
Change in valuation allowances on deferred tax assets		73,000		(4,576,000)		(897,000)
Other		17,000		(3,000)		15,000
	$	3,082,000	$	(990,000)	$	132,000

Schedule of the tax effects of temporary differences that give rise to significant portions of the net deferred tax assets and liabilities


	January 1,		January 2,		December 27,
	2016		2015		2013
Deferred tax assets:
Accounts receivable allowance	$	303,000	$	265,000	$	156,000
Other accrued liabilities		1,618,000		1,482,000		764,000
Federal and state net operating losses		156,000		244,000		3,157,000
Intangible assets		3,891,000		4,016,000		4,571,000
Other		224,000		409,000		64,000
		6,192,000		6,416,000		8,712,000
Valuation allowance		(73,000)		—		(4,576,000)
Net deferred tax assets		6,119,000		6,416,000		4,136,000
Deferred tax liabilities:
Deferred revenue		(5,510,000)		(4,878,000)		(4,125,000)
Fixed assets		(696,000)		(111,000)		(11,000)
Other		(244,000)		—		—
		(6,450,000)		(4,989,000)		(4,136,000)
Net deferred tax (liability) asset	$	(331,000)	$	1,427,000	$	—

SEGMENT INFORMATION (Tables)

12 Months Ended

Jan. 01, 2016

SEGMENT INFORMATION

Schedule of financial information with respect to the reportable segments


			Energy		Public		Homeland
	Engineering		Efficiency		Finance		Security		Unallocated				Consolidated
	Services		Services		Services		Services		Corporate		Intersegment		Total
Fiscal Year 2015
Contract revenue	$	45,997,000	$	74,123,000	$	11,857,000	$	3,126,000	$	—	$	—	$	135,103,000
Depreciation and amortization		359,000		1,525,000		159,000		29,000		—		—		2,072,000
Interest (expense) income		(10,000)		(194,000)		(2,000)		(1,000)		—		—		(207,000)
Segment profit (loss) before income tax expense		4,666,000		2,499,000		1,148,000		418,000		(1,390,000)		—		7,341,000
Income tax (benefit) expense		1,959,000		1,049,000		482,000		176,000		(584,000)		—		3,082,000
Net income (loss)		2,707,000		1,450,000		666,000		242,000		(806,000)		—		4,259,000
Segment assets(1)		13,641,000		34,686,000		5,377,000		894,000		40,877,000		(23,130,000)		72,345,000
Fiscal Year 2014
Contract revenue	$	40,783,000	$	52,941,000	$	10,630,000	$	3,726,000	$	—	$	—	$	108,080,000
Depreciation and amortization		191,000		212,000		39,000		18,000		—				459,000
Interest (expense) income		17,000		(33,000)		2,000		(2,000)		—				(16,000)
Segment profit (loss) before income tax expense		4,008,000		4,814,000		661,000		443,000		(1,500,000)		—		8,426,000
Income tax (benefit) expense		(454,000)		(599,000)		(64,000)		(49,000)		176,000		—		(990,000)
Net income (loss)		4,462,000		5,413,000		725,000		492,000		(1,676,000)		—		9,416,000
Segment assets(1)		11,166,000		11,769,000		3,944,000		708,000		44,873,000		(23,130,000)		49,330,000
Fiscal Year 2013
Contract revenue	$	35,217,000	$	36,041,000	$	9,845,000	$	4,407,000	$	—	$	—	$	85,510,000
Depreciation and amortization		214,000		223,000		41,000		39,000		—		—		517,000
Interest (expense) income		(68,000)		(25,000)		(3,000)		2,000		—		—		(94,000)
Segment profit before income tax expense		1,125,000		710,000		535,000		392,000		—		—		2,762,000
Income tax expense (benefit)		53,000		45,000		17,000		17,000		—		—		132,000
Net income		1,072,000		665,000		518,000		375,000		—		—		2,630,000
Segment assets(1)		10,436,000		10,305,000		3,528,000		1,406,000		35,692,000		(23,130,000)		38,237,000

(1)

Segment assets are presented net of intercompany receivables.

(2)

The following sets forth the assets that are included in Unallocated Corporate as of January 1, 2016, January 2, 2015 and December 27, 2013.


	2015		2014		2013
Assets:
Cash and cash equivalents	$	14,385,000	$	20,371,000	$	7,341,000
Prepaid expenses		758,000		1,404,000		1,206,000
Intercompany receivables		82,845,000		85,259,000		114,800,000
Other receivables		49,000		19,000		73,000
Equipment and leasehold improvements, net		2,231,000		440,000		177,000
Investments in subsidiaries		23,130,000		23,130,000		23,130,000
Other		53,000		4,640,000		3,765,000
	$	123,451,000	$	135,263,000	$	150,492,000

Schedule of assets included in Unallocated Corporate


	2015		2014		2013
Assets:
Cash and cash equivalents	$	14,385,000	$	20,371,000	$	7,341,000
Prepaid expenses		758,000		1,404,000		1,206,000
Intercompany receivables		82,845,000		85,259,000		114,800,000
Other receivables		49,000		19,000		73,000
Equipment and leasehold improvements, net		2,231,000		440,000		177,000
Investments in subsidiaries		23,130,000		23,130,000		23,130,000
Other		53,000		4,640,000		3,765,000
	$	123,451,000	$	135,263,000	$	150,492,000

QUARTERLY FINANCIAL INFORMATION (UNAUDITED) (Tables)

12 Months Ended

Jan. 01, 2016

QUARTERLY FINANCIAL INFORMATION (UNAUDITED)

Schedule of selected quarterly information


	Fiscal Three Months Ended
	April 3,		July 3,		October 2,		January 1,
	2015		2015		2015		2016
	(in thousands except per share amounts)
Contract revenue	$	33,297	$	36,773	$	33,511	$	31,522
Income from operations		2,629		2,804		1,641		456
Income tax expense		1,138		1,108		626		210
Net income		1,495		1,602		782		380
Earnings per share:
Basic	$	0.19	$	0.20	$	0.10	$	0.05
Diluted	$	0.18	$	0.20	$	0.10	$	0.05
Weighted-average shares outstanding:
Basic		7,765		7,824		7,862		7,888
Diluted		8,103		8,136		8,102		8,132


	Fiscal Three Months Ended
	March 28,		June 27,		September 26,		January 2,
	2014		2014		2014		2015
	(in thousands except per share amounts)
Contract revenue	$	22,686	$	26,970	$	28,187	$	30,237
Income from operations		1,312		1,941		2,651		2,405
Income tax expense (benefit)		44		64		(1,464)		366
Net income		1,315		1,893		4,161		2,047
Earnings per share:
Basic	$	0.18	$	0.26	$	0.55	$	0.27
Diluted	$	0.17	$	0.25	$	0.53	$	0.26
Weighted-average shares outstanding:
Basic		7,397		7,405		7,507		7,618
Diluted		7,609		7,661		7,855		7,986

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cash and Cash Equivalents and Liquid Investments) (Details)	12 Months Ended
	Jan. 01, 2016 USD ($) subsidiary segment	Jan. 02, 2015 USD ($)	Dec. 27, 2013 USD ($)	Dec. 28, 2012 USD ($)
Cash, Cash Equivalents and Liquid Investments
Cash and cash equivalents \| $	$ 16,487,000	$ 18,173,000	$ 6,661,000	$ 8,818,000
Segment Information
Number of wholly owned subsidiaries \| subsidiary	6
Number of subsidiaries aggregated as one reporting segment \| subsidiary	3
Number of reportable segments into which three of the six subsidiaries are aggregated \| segment	1
Number of subsidiaries each of which comprise separate reporting segments \| subsidiary	3
BMO Harris Bank Master Control Operating Account
Cash, Cash Equivalents and Liquid Investments
Cash and cash equivalents \| $	$ 16,438,000	18,119,000
Cash on hand in business checking accounts
Cash, Cash Equivalents and Liquid Investments
Cash and cash equivalents \| $	$ 49,000	$ 54,000

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Accounting for Contracts) (Details)	12 Months Ended
	Jan. 01, 2016 USD ($) segment	Jan. 02, 2015 USD ($)	Dec. 27, 2013 USD ($)	Oct. 02, 2015 USD ($)
Accounting for Contracts
Number of reportable segments \| segment	4
Costs of contract revenue
Payroll taxes, bonuses and employee benefit costs for all Company personnel	$ 25,741,000	$ 21,394,000	$ 20,555,000
Facilities costs	4,246,000	4,371,000	$ 4,654,000
Revenue of the entity recorded in which it acts solely in the capacity of an agent	0
Costs recorded for costs to the entity in which it acts solely in the capacity of an agent	0
Accounts receivable
Costs of contract revenue
Retained accounts receivable		700,000		$ 748,000
Cost of Sales
Costs of contract revenue
Payroll taxes, bonuses and employee benefit costs for all Company personnel	0	0
Facilities costs	$ 0	$ 0

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Estimated Useful Lives) (Details)	12 Months Ended
	Jan. 01, 2016
Equipment \| Minimum
Equipment and Leasehold Improvements
Estimated useful life	2 years
Equipment \| Maximum
Equipment and Leasehold Improvements
Estimated useful life	5 years
Furniture and fixtures
Equipment and Leasehold Improvements
Estimated useful life	5 years
Computer hardware
Equipment and Leasehold Improvements
Estimated useful life	2 years
Computer software
Equipment and Leasehold Improvements
Estimated useful life	3 years
Automobiles and trucks
Equipment and Leasehold Improvements
Estimated useful life	3 years
Field equipment
Equipment and Leasehold Improvements
Estimated useful life	5 years

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Income Taxes and Recent Accounting Pronouncements) - USD ($)		12 Months Ended
	Jan. 02, 2015	Jan. 01, 2016
Income Taxes
Valuation reserve related to California net operating losses		$ 73,000
Reversal of valuation allowance	$ 4,600,000	4,600,000
New Accounting Pronouncements
Current liabilities	18,447,000	$ 28,016,000
ASU 2015-17 \| Early adoption effect
New Accounting Pronouncements
Current liabilities	(3,100,000)
Non-current assets	$ (3,100,000)

BUSINESS COMBINATIONS (Details) $ / shares in Units, shares in Thousands				3 Months Ended								5 Months Ended	12 Months Ended
	Jan. 01, 2016 USD ($) $ / shares	Apr. 03, 2015 USD ($)	Jan. 15, 2015 USD ($) item shares	Jan. 01, 2016 USD ($) $ / shares	Oct. 02, 2015 USD ($)	Jul. 03, 2015 USD ($)	Apr. 03, 2015 USD ($)	Jan. 02, 2015 USD ($) $ / shares	Sep. 26, 2014 USD ($)	Jun. 27, 2014 USD ($)	Mar. 28, 2014 USD ($)	Jul. 03, 2015 USD ($)	Jan. 01, 2016 USD ($) $ / shares shares	Jan. 02, 2015 USD ($) $ / shares shares	Dec. 27, 2013 USD ($)
BUSINESS COMBINATIONS
Number of acquisitions \| item			2
Par value (in dollars per share) \| $ / shares	$ 0.01			$ 0.01				$ 0.01					$ 0.01	$ 0.01
Cash paid at closing													$ 8,501,000
Fair values of intangible assets				$ 400,000
Accrued liabilities				500,000
Reduction in fair value of contingent consideration payable				(900,000)
Decrease in goodwill				800,000
Increase in Net Income													200,000
Increase in Equity													200,000
Consideration for acquisitions
Cash paid													8,501,000
Issuance of common stock													1,484,000
Issuance of notes payable													4,250,000
Contingent consideration	$ 5,178,000			5,178,000									5,178,000
Total consideration													19,413,000
Accretion of contingent consideration													547,000
Allocation of acquired assets
Cash acquired	332,000			332,000									332,000
Property, plant and equipment	244,000			244,000									244,000
Liabilities	(512,000)			(512,000)									(512,000)
Other assets, net	536,000			536,000									536,000
Goodwill	16,097,000			16,097,000									16,097,000
Net assets acquired	19,413,000			19,413,000									19,413,000
Unaudited pro forma financial information
Pro forma revenue													135,576,000	$ 130,181,000
Pro forma income from operations													8,204,000	12,162,000
Pro forma net income													$ 4,759,000	$ 12,162,000
Earnings per share:
Basic (in dollars per share) \| $ / shares													$ 0.61	$ 1.62
Diluted (in dollars per share) \| $ / shares													$ 0.59	$ 1.57
Weighted-average shares outstanding:
Basic (in shares) \| shares													7,834	7,488
Diluted (in shares) \| shares													8,113	7,739
Revenue and Income from operations
Revenue				31,522,000	$ 33,511,000	$ 36,773,000	$ 33,297,000	$ 30,237,000	$ 28,187,000	$ 26,970,000	$ 22,686,000		$ 135,103,000	$ 108,080,000	$ 85,510,000
Income from operations				456,000	$ 1,641,000	$ 2,804,000	2,629,000	$ 2,405,000	$ 2,651,000	$ 1,941,000	$ 1,312,000		7,530,000	8,309,000	$ 2,608,000
General and Administrative Expense
Revenue and Income from operations
Acquisition costs													200,000	$ 300,000
License to bid
Allocation of acquired assets
Intangible assets	308,000			308,000									308,000
Backlog
Allocation of acquired assets
Intangible assets	348,000			348,000									348,000
Tradename
Allocation of acquired assets
Intangible assets	1,049,000			1,049,000									1,049,000
Non-compete agreements
Allocation of acquired assets
Intangible assets	1,011,000			1,011,000									1,011,000
Abacus, 360 Energy and Economist, LLC
BUSINESS COMBINATIONS
Tax deductible goodwill	16,500,000			16,500,000									16,500,000
Earn-out payment	5,700,000
Consideration for acquisitions
Contingent consideration including accretion related to contingent consideration	5,700,000			5,700,000									5,700,000
Accretion of contingent consideration													500,000
Revenue and Income from operations
Revenue													23,800,000
Income from operations													1,300,000
Abacus and 360 Energy
BUSINESS COMBINATIONS
Cash paid at closing			$ 5,400,000
Consideration for acquisitions
Cash paid			5,400,000
Abacus and 360 Energy \| Term Note \| BMO
BUSINESS COMBINATIONS
Amount borrowed to finance acquisition			2,000,000
Abacus
BUSINESS COMBINATIONS
Maximum contingent consideration to be paid			800,000
Cash paid at closing			2,500,000									$ 600,000	3,136,000
Consideration for acquisitions
Cash paid			$ 2,500,000									$ 600,000	3,136,000
Issuance of common stock													913,000
Issuance of notes payable													1,250,000
Contingent consideration	589,000			589,000									589,000
Total consideration													5,888,000
Allocation of acquired assets
Cash acquired	332,000			332,000									332,000
Property, plant and equipment	78,000			78,000									78,000
Liabilities	(512,000)			(512,000)									(512,000)
Other assets, net	495,000			495,000									495,000
Goodwill	4,575,000			4,575,000									4,575,000
Net assets acquired	5,888,000			5,888,000									5,888,000
Abacus \| Common Stock
BUSINESS COMBINATIONS
Consideration in Common Stock (in shares) \| shares			75,758
Abacus \| Maximum
Consideration for acquisitions
Total consideration			$ 6,100,000
Abacus \| License to bid
Allocation of acquired assets
Intangible assets	308,000			308,000									308,000
Abacus \| Backlog
Allocation of acquired assets
Intangible assets	161,000			161,000									161,000
Abacus \| Tradename
Allocation of acquired assets
Intangible assets	323,000			323,000									323,000
Abacus \| Non-compete agreements
Allocation of acquired assets
Intangible assets	128,000			128,000									128,000
360 Energy
BUSINESS COMBINATIONS
Maximum contingent consideration to be paid			$ 6,500,000
Cash paid at closing													4,875,000
Consideration for acquisitions
Cash paid													4,875,000
Issuance of common stock													571,000
Issuance of notes payable													3,000,000
Contingent consideration	4,221,000			4,221,000									4,221,000
Total consideration													12,667,000
Allocation of acquired assets
Property, plant and equipment	166,000			166,000									166,000
Other assets, net	41,000			41,000									41,000
Goodwill	10,773,000			10,773,000									10,773,000
Net assets acquired	12,667,000			12,667,000									12,667,000
360 Energy \| Common Stock
BUSINESS COMBINATIONS
Consideration in Common Stock (in shares) \| shares			47,348
360 Energy \| Maximum
Consideration for acquisitions
Total consideration			$ 15,000,000
360 Energy \| Backlog
Allocation of acquired assets
Intangible assets	158,000			158,000									158,000
360 Energy \| Tradename
Allocation of acquired assets
Intangible assets	669,000			669,000									669,000
360 Energy \| Non-compete agreements
Allocation of acquired assets
Intangible assets	860,000			860,000									860,000
Economists LLC
BUSINESS COMBINATIONS
Maximum contingent consideration to be paid		$ 600,000					$ 600,000
Cash paid at closing		500,000											490,000
Consideration for acquisitions
Cash paid		500,000											490,000
Contingent consideration	368,000			368,000									368,000
Total consideration													858,000
Allocation of acquired assets
Goodwill	749,000			749,000									749,000
Net assets acquired	858,000			858,000									858,000
Economists LLC \| Maximum
Consideration for acquisitions
Total consideration		$ 1,100,000
Economists LLC \| Backlog
Allocation of acquired assets
Intangible assets	29,000			29,000									29,000
Economists LLC \| Tradename
Allocation of acquired assets
Intangible assets	57,000			57,000									57,000
Economists LLC \| Non-compete agreements
Allocation of acquired assets
Intangible assets	$ 23,000			$ 23,000									$ 23,000

GOODWILL AND OTHER INTANGIBLE ASSETS (Carrying value of goodwill by reporting unit ) - USD ($)	12 Months Ended
	Jan. 01, 2016	Jan. 02, 2015	Dec. 27, 2013
Changes in carrying value of goodwill
Additional Purchase Cost	$ 16,097,000
Goodwill impairment	0	$ 0	$ 0
Goodwill at end of period	16,097,000
Energy Efficiency Services
Changes in carrying value of goodwill
Additional Purchase Cost	15,348,000
Goodwill at end of period	15,348,000
Public Finance Services
Changes in carrying value of goodwill
Additional Purchase Cost	749,000
Goodwill at end of period	$ 749,000

GOODWILL AND OTHER INTANGIBLE ASSETS (Details 3) - USD ($)	12 Months Ended			24 Months Ended
	Jan. 01, 2016	Jan. 02, 2015	Dec. 27, 2013	Jan. 02, 2015
Goodwill and other intangible assets
Gross Amount	$ 2,716,000
Accumulated Amortization	1,171,000
Amortization expense for acquired identifiable intangible assets	1,200,000	$ 0		$ 0
Estimated amortization expense for acquired identifiable intangible assets
2016	553,000
2017	475,000
2018	306,000
2019	202,000
2020	9,000
Total estimated amortization expense	1,545,000
Goodwill impairment
Goodwill impairment	0	$ 0	$ 0
Backlog
Goodwill and other intangible assets
Gross Amount	348,000
Accumulated Amortization	$ 340,000
Amortization Period (in years)	1 year
Tradename
Goodwill and other intangible assets
Gross Amount	$ 1,049,000
Accumulated Amortization	$ 329,000
Tradename \| Minimum
Goodwill and other intangible assets
Amortization Period (in years)	2 years 6 months
Tradename \| Maximum
Goodwill and other intangible assets
Amortization Period (in years)	3 years 6 months
Non-compete agreements
Goodwill and other intangible assets
Gross Amount	$ 1,011,000
Accumulated Amortization	$ 194,000
Non-compete agreements \| Minimum
Goodwill and other intangible assets
Amortization Period (in years)	4 years
Non-compete agreements \| Maximum
Goodwill and other intangible assets
Amortization Period (in years)	5 years
License to bid
Goodwill and other intangible assets
Gross Amount	$ 308,000
Accumulated Amortization	$ 308,000
Amortization Period (in years)	1 year

EARNINGS PER SHARE ("EPS") (Details) - USD ($)	3 Months Ended								12 Months Ended
EARNINGS PER SHARE ("EPS") (Details) - USD ($)	Jan. 01, 2016	Oct. 02, 2015	Jul. 03, 2015	Apr. 03, 2015	Jan. 02, 2015	Sep. 26, 2014	Jun. 27, 2014	Mar. 28, 2014	Jan. 01, 2016	Jan. 02, 2015	Dec. 27, 2013
Earnings per share
Net income	$ 380,000	$ 782,000	$ 1,602,000	$ 1,495,000	$ 2,047,000	$ 4,161,000	$ 1,893,000	$ 1,315,000	$ 4,259,000	$ 9,416,000	$ 2,630,000
Weighted-average common shares outstanding (in shares)	7,888,000	7,862,000	7,824,000	7,765,000	7,618,000	7,507,000	7,405,000	7,397,000	7,834,000	7,488,000	7,355,000
Effect of dilutive stock options and restricted stock awards (in shares)									279,000	251,000	140,000
Weighted-average common shares outstanding-diluted (in shares)	8,132,000	8,102,000	8,136,000	8,103,000	7,986,000	7,855,000	7,661,000	7,609,000	8,113,000	7,739,000	7,495,000
Earnings per share:
Basic (in dollars per share)	$ 0.05	$ 0.10	$ 0.20	$ 0.19	$ 0.27	$ 0.55	$ 0.26	$ 0.18	$ 0.54	$ 1.26	$ 0.36
Diluted (in dollars per share)	$ 0.05	$ 0.10	$ 0.20	$ 0.18	$ 0.26	$ 0.53	$ 0.25	$ 0.17	$ 0.52	$ 1.22	$ 0.35
Stock options
Anti-dilutive securities excluded from the computation of earnings per share
Number of awards excluded from calculation of dilutive potential common shares (in shares)									314,500	251,000	459,000

ACCOUNTS RECEIVABLE (Details)	12 Months Ended
ACCOUNTS RECEIVABLE (Details)	Jan. 01, 2016 USD ($) client	Jan. 02, 2015 USD ($)	Dec. 27, 2013 USD ($)	Jan. 01, 2016 USD ($)	Jan. 02, 2015 USD ($)
Accounts receivable
Gross				$ 32,529,000	$ 26,021,000
Allowance for doubtful accounts	$ (662,000)	$ (385,000)	$ (303,000)	(760,000)	(662,000)
Net				31,769,000	25,359,000
Movements in the allowance for doubtful accounts
Balance as of the beginning of the year	662,000	385,000	303,000
Provision for doubtful accounts	586,000	486,000	189,000
Write-offs of uncollectible accounts	(488,000)	(209,000)	(107,000)
Balance as of the end of the year	$ 760,000	$ 662,000	$ 385,000
Accounts Receivable. \| Credit concentration risk
Movements in the allowance for doubtful accounts
Number of clients representing concentration risk on outstanding receivables \| client	1
Percentage of outstanding receivables accounted for by one client	15.00%	17.00%
Billed
Accounts receivable
Gross				17,941,000	13,151,000
Unbilled
Accounts receivable
Gross				13,840,000	12,170,000
Contract retentions
Accounts receivable
Gross				$ 748,000	$ 700,000

EQUIPMENT AND LEASEHOLD IMPROVEMENTS (Details) - USD ($)	Jan. 01, 2016	Jan. 02, 2015
EQUIPMENT AND LEASEHOLD IMPROVEMENTS
Equipment and leasehold improvements, gross	$ 12,088,000	$ 11,042,000
Accumulated depreciation and amortization	(8,404,000)	(9,658,000)
Equipment and leasehold improvements, net	3,684,000	1,384,000
Furniture and fixtures
EQUIPMENT AND LEASEHOLD IMPROVEMENTS
Equipment and leasehold improvements, gross	2,270,000	2,994,000
Computer hardware and software
EQUIPMENT AND LEASEHOLD IMPROVEMENTS
Equipment and leasehold improvements, gross	6,496,000	5,667,000
Leasehold improvements
EQUIPMENT AND LEASEHOLD IMPROVEMENTS
Equipment and leasehold improvements, gross	1,072,000	785,000
Equipment under capital leases
EQUIPMENT AND LEASEHOLD IMPROVEMENTS
Equipment and leasehold improvements, gross	1,266,000	919,000
Accumulated depreciation and amortization	(259,000)	(176,000)
Automobiles, trucks, and field equipment
EQUIPMENT AND LEASEHOLD IMPROVEMENTS
Equipment and leasehold improvements, gross	$ 984,000	$ 677,000

ACCRUED LIABILITIES (Details) - USD ($)	Jan. 01, 2016	Jan. 02, 2015
ACCRUED LIABILITIES
Accrued bonuses	$ 922,000	$ 1,450,000
Accrued interest	4,000
Paid leave bank	1,710,000	1,404,000
Compensation and payroll taxes	1,494,000	1,371,000
Accrued legal	523,000	556,000
Accrued workers' compensation insurance	268,000	192,000
Accrued rent	169,000	149,000
Employee withholdings	942,000	637,000
Client deposits	106,000	79,000
Unvouchered accounts payable	3,061,000	4,462,000
Other	1,135,000	368,000
Total accrued liabilities	$ 10,334,000	$ 10,668,000

EQUITY PLANS (Details)		1 Months Ended		12 Months Ended					91 Months Ended	94 Months Ended	115 Months Ended
EQUITY PLANS (Details)	Jan. 01, 2016 plan shares	Mar. 31, 2008 shares	Jun. 30, 2006 shares	Jan. 01, 2016 USD ($) shares	Jan. 02, 2015 USD ($) shares	Dec. 27, 2013 USD ($) shares	Dec. 28, 2012 shares	Dec. 31, 2010 shares	Jan. 01, 2016 shares	Jan. 01, 2016 shares	Jan. 01, 2016 shares	Jun. 30, 2008 shares
Equity plans
Number of share-based compensation plans \| plan	2
Compensation expense recognized for stock options issued (in dollars) \| $				$ 777,000	$ 258,000	$ 150,000
2006 Plan
Equity plans
Granted (in shares)									0
Number of shares of common stock reserved for issuance	168,500		300,000	168,500					168,500	168,500	168,500
2008 Plan
Equity plans
Termination period of the plan		10 years
Number of shares of common stock reserved for issuance		450,000
Shares available for grant under 2008 Plan from 2006 Plan												70,333
Number of additional shares authorized							500,000	350,000
Stock options
Equity plans
Granted (in shares)				165,000	235,000	100,000
Stock options \| 2008 Plan
Equity plans
Maximum number of shares a participant may be granted in options to purchase during fiscal year				100,000
Incentive stock options \| 2006 Plan
Equity plans
Options granted, net of forfeitures, expirations and exercises (in shares)											154,000
Incentive stock options \| 2008 Plan
Equity plans
Options granted, net of forfeitures, expirations and exercises (in shares)										629,000
Incentive stock options \| 2008 Plan \| Maximum
Equity plans
Expiration period from date of grant				10 years
Non-statutory/Nonqualified stock options \| 2006 Plan
Equity plans
Options granted, net of forfeitures, expirations and exercises (in shares)											6,000
Non-statutory/Nonqualified stock options \| 2006 Plan \| Maximum
Equity plans
Expiration period from date of grant			10 years
Non-statutory/Nonqualified stock options \| 2008 Plan
Equity plans
Options granted, net of forfeitures, expirations and exercises (in shares)										176,000
Non-statutory/Nonqualified stock options \| 2008 Plan \| Maximum
Equity plans
Expiration period from date of grant				10 years
Restricted stock \| 2008 Plan
Equity plans
Shares granted										38,000

EQUITY PLANS (Assumptions) (Details)	12 Months Ended
EQUITY PLANS (Assumptions) (Details)	Jan. 01, 2016	Jan. 02, 2015	Dec. 27, 2013
Stock options
Assumptions
Expected volatility (as a percent)			40.00%
Expected volatility, minimum (as a percent)	38.00%	38.00%
Expected volatility, maximum (as a percent)	42.00%	40.00%
Expected dividends (as a percent)	0.00%	0.00%	0.00%
Expected term (in years)	6 years	6 years
Risk-free rate, minimum (as a percent)	1.33%	1.63%	1.31%
Risk-free rate, maximum (as a percent)	1.75%	1.73%	1.36%
Stock options \| Maximum
Assumptions
Expected term (in years)			6 years
Restricted stock \| 2008 Plan
Assumptions
Vesting period (in years)	2 years

EQUITY PLANS (Option Activity) (Details) - USD ($)	12 Months Ended				91 Months Ended
EQUITY PLANS (Option Activity) (Details) - USD ($)	Jan. 01, 2016	Jan. 02, 2015	Dec. 27, 2013	Dec. 28, 2012	Jan. 01, 2016
Fully-vested options
Stock price at the end of the year (in dollars per share)	$ 8.38				$ 8.38
2006 Plan
Options
Granted (in shares)					0
Stock options
Fully-vested options
Intrinsic value of the fully-vested options (in dollars)	$ 2,291,000				$ 2,291,000
Options
Outstanding (in shares)	926,000	978,000	992,000
Granted (in shares)	165,000	235,000	100,000
Exercised (in shares)	(103,000)	(198,000)	(9,000)
Forfeited or expired (in shares)	(24,000)	(89,000)	(105,000)
Outstanding (in shares)	964,000	926,000	978,000	992,000	964,000
Vested (in shares)	624,000	595,000	796,000		624,000
Exercisable (in shares)	624,000	595,000	796,000		624,000
Weighted-Average Exercise Price
Outstanding (in dollars per share)	$ 5.84	$ 3.95	$ 3.86
Granted (in dollars per share)	12.33	10.23	3.62
Exercised (in dollars per share)	3.72	2.24	1.65
Forfeited or expired	3.94	2.57
Outstanding (in dollars per share)	7.22	5.84	3.95	$ 3.86	$ 7.22
Vested (in dollars per share)	5.24	4.47	4.04		5.24
Exercisable (in dollars per share)	$ 5.24	$ 4.47	$ 4.04		$ 5.24
Weighted-Average Remaining Contractual Term
Outstanding	6 years 15 days	6 years 5 months 9 days	3 years 4 months 6 days	6 years 11 months 12 days
Vested	4 years 6 months 11 days	4 years 11 months 1 day	7 years 10 months 24 days
Exercisable	4 years 6 months 11 days	4 years 11 months 1 day	7 years 10 months 24 days

EQUITY PLANS (Nonvested Option Activity) (Details) - $ / shares	12 Months Ended			91 Months Ended
	Jan. 01, 2016	Jan. 02, 2015	Dec. 27, 2013	Jan. 01, 2016
2006 Plan
Nonvested Options
Granted (in shares)				0
Stock options
Nonvested Options
Nonvested outstanding (in shares)	331,000	207,000	293,000
Granted (in shares)	165,000	235,000	100,000
Vested (in shares)	(132,000)	(108,000)	(143,000)
Forfeited (in shares)	(24,000)	(3,000)	(43,000)
Nonvested outstanding (in shares)	340,000	331,000	207,000	340,000
Nonvested Options, Weighted Average Grant-Date Fair Value
Nonvested (in dollars per share)	$ 3.37	$ 3.55	$ 1.28
Granted (in dollars per share)	4.92	4.15	3.62
Vested (in dollars per share)	3.67	3.41	3.17
Forfeited (in dollars per share)	3.94	3.85	3.33
Nonvested (in dollars per share)	$ 3.77	$ 3.37	$ 3.55	$ 3.77

EQUITY PLANS (Restricted Stock Activity) (Details) - USD ($)	12 Months Ended
	Jan. 01, 2016	Jan. 02, 2015	Dec. 27, 2013
Unrecognized compensation expense
Weighted-average period over which unrecognized expense is expected to be recognized	2 years 2 months 5 days
Stock options
Unrecognized compensation expense
Unrecognized compensation expense related to non-vested stock options (in dollars)	$ 1,280,000	$ 322,000
Awards granted that were immediately vested (in shares)	0	0	0
Restricted stock
Unrecognized compensation expense
Unrecognized compensation expense related to non-vested restricted stock grants (in dollars)	$ 422,000	$ 142,000
Restricted stock \| 2008 Plan
Restricted Stock Activity
Intrinsic value of the fully-vested awards (in dollars)	$ 354,000	$ 144,000
Restricted Stock
Outstanding (in shares)	38,000	25,000
Awarded (in shares)	25,000	25,000
Vested (in shares)	(25,000)	(12,000)
Outstanding (in shares)	38,000	38,000	25,000
Weighted-Average Grant Date Fair Value
Outstanding (in dollars per share)	$ 5.74	$ 2.96
Awarded (in dollars per share)	13.91	7.13
Vested (in dollars per share)	5.05	2.96
Outstanding (in dollars per share)	$ 11.66	$ 5.74	$ 2.96

EQUITY PLANS (Stock Purchase Plan) (Details) - 2006 Employee Stock Purchase Plan - shares	12 Months Ended
	Jan. 01, 2016	Jun. 30, 2006
Employee Stock Purchase Plan
Number of shares of common stock reserved for issuance		300,000
Shares issuable in any one calendar year	100,000
Purchase price per share as a percentage of fair market value	95.00%
Number of shares available for issuance	66,483

DEBT OBLIGATIONS (Details) - USD ($)	12 Months Ended		24 Months Ended
DEBT OBLIGATIONS (Details) - USD ($)	Jan. 01, 2016	Jan. 02, 2015	Jan. 01, 2016
Debt Obligations
Total debt obligations, excluding capital lease obligations	$ 5,124,000	$ 355,000	$ 5,124,000
Less current portion	4,039,000	$ 355,000	4,039,000
Outstanding balance	1,085,000		1,085,000
Revolving line of credit
Debt Obligations
Total debt obligations, excluding capital lease obligations	1,850,000		1,850,000
Notes payable for vehicles
Debt Obligations
Total debt obligations, excluding capital lease obligations	$ 2,033,000		$ 2,033,000
Maturity term	35 months	35 months
Interest rate (as a percent)	4.00%	4.00%	4.00%
Monthly principal and interest installment (in dollars)	$ 88,752	$ 88,752
Notes payable for Abacus
Debt Obligations
Total debt obligations, excluding capital lease obligations	$ 690,000		$ 690,000
Maturity term	24 months	24 months
Interest rate (as a percent)	4.00%	4.00%	4.00%
Monthly principal and interest installment (in dollars)	$ 54,281	$ 54,281
Notes payable for insurance
Debt Obligations
Total debt obligations, excluding capital lease obligations	$ 551,000	$ 352,000	$ 551,000
Maturity term	11 months	11 months
Interest rate (as a percent)	2.773%	2.773%	2.773%
Monthly principal and interest installment (in dollars)			$ 55,868
Other
Debt Obligations
Total debt obligations, excluding capital lease obligations		$ 3,000

DEBT OBLIGATIONS (Details 2) - USD ($)		3 Months Ended	12 Months Ended
DEBT OBLIGATIONS (Details 2) - USD ($)	Jan. 15, 2015	Jan. 01, 2016	Jan. 01, 2016	Jan. 02, 2015	Dec. 27, 2013	Mar. 24, 2014
Line of Credit
Payment on note			$ 2,090,000	$ 162,000	$ 621,000
Total debt obligations, excluding capital lease obligations		$ 5,124,000	5,124,000	355,000
Less current portion		(4,039,000)	(4,039,000)	(355,000)
Principal maturities
Total debt obligations, excluding capital lease obligations		5,124,000	5,124,000	$ 355,000
Abacus Notes
Line of Credit
Interest rate (as a percent)	4.00%
Payment on note			280,000
Outstanding balance		345,000	345,000
Kinzer Note
Line of Credit
Amount borrowed to finance acquisition	$ 625,000
Rubbert Note
Line of Credit
Amount borrowed to finance acquisition	625,000
360 Energy Note
Line of Credit
Amount borrowed to finance acquisition	$ 3,000,000
Interest rate (as a percent)	4.00%
Payment on note			967,000
Outstanding balance		2,033,000	2,033,000
Revolving Credit Facility
Line of Credit
Maximum total leverage ratio of total funded debt to EBITDA thereafter	2.0
Minimum fixed charge coverage ratio	1.25
Revolving Credit Facility \| BMO
Line of Credit
Maximum borrowing capacity						$ 7,500,000
Maximum total leverage ratio of total funded debt to EBITDA for first four fiscal quarters after acquisition	2.25
Step up amount equal to net income required to be maintained (as a percent)	50.00%
Step up amount equal to net income required to be maintained after first quarter of current fiscal year (as a percent)	50.00%
Adjustment to tangible net worth arising from acquisition (as a percent)	80.00%
Percentage of increased interest rate in case of default	2.00%
Revolving Credit Facility \| Maximum \| BMO
Line of Credit
Total consideration for all permitted acquisitions	$ 1,500,000
Total consideration for individual permitted acquisitions	$ 750,000
Revolving line of credit
Line of Credit
Total debt obligations, excluding capital lease obligations		1,850,000	1,850,000
Principal maturities
Total debt obligations, excluding capital lease obligations		1,850,000	1,850,000
Revolving line of credit \| BMO
Line of Credit
Amount available for borrowing		$ 7,500,000	$ 7,500,000
Percentage of eligible accounts receivable used to determine maximum borrowing base			75.00%
Percentage of the lower of cost or market value of eligible inventory used to determine maximum borrowing base			50.00%
Revolving line of credit \| Maximum \| BMO
Line of Credit
Fee on unused commitments (as a percent)	0.30%
Revolving line of credit \| Base rate \| Maximum \| BMO
Line of Credit
Spread on floating interest rate (as a percent)			1.25%
Revolving line of credit \| Base rate \| Minimum \| BMO
Line of Credit
Spread on floating interest rate (as a percent)			0.75%
Revolving line of credit \| LIBOR \| Maximum \| BMO
Line of Credit
Spread on floating interest rate (as a percent)			2.25%
Revolving line of credit \| LIBOR \| Minimum \| BMO
Line of Credit
Spread on floating interest rate (as a percent)			1.75%
Standby letter of credit sub-facility \| BMO
Line of Credit
Maximum borrowing capacity						$ 5,000,000
Term Note \| BMO
Line of Credit
Interest rate at end of period (as a percent)		3.10%	3.10%
Amount of quarterly principal payments in 2015		$ 50,000
Amount of quarterly principal payments in 2016		50,000
Maximum borrowing capacity	$ 3,000,000
Borrowings outstanding		1,850,000	$ 1,850,000
Amount available for borrowing		$ 1,150,000	$ 1,150,000
Term Note \| Abacus and 360 Energy \| BMO
Line of Credit
Amount borrowed to finance acquisition	$ 2,000,000
Term Note \| Base rate \| Maximum \| BMO
Line of Credit
Spread on floating interest rate (as a percent)			1.75%
Term Note \| Base rate \| Minimum \| BMO
Line of Credit
Spread on floating interest rate (as a percent)			1.25%
Term Note \| LIBOR \| BMO
Line of Credit
Spread on floating interest rate (as a percent)			2.50%
Term Note \| LIBOR \| Maximum \| BMO
Line of Credit
Spread on floating interest rate (as a percent)	2.75%		2.75%
Term Note \| LIBOR \| Minimum \| BMO
Line of Credit
Spread on floating interest rate (as a percent)	2.25%		2.25%
Notes payable for vehicles
Line of Credit
Interest rate (as a percent)		4.00%	4.00%	4.00%
Total debt obligations, excluding capital lease obligations		$ 2,033,000	$ 2,033,000
Maturity term			35 months	35 months
Monthly principal and interest installment (in dollars)			$ 88,752	$ 88,752
Principal maturities
Total debt obligations, excluding capital lease obligations		$ 2,033,000	$ 2,033,000
Other
Line of Credit
Total debt obligations, excluding capital lease obligations				3,000
Principal maturities
Total debt obligations, excluding capital lease obligations				$ 3,000

COMMITMENTS (Leases) (Details) - USD ($)	12 Months Ended
COMMITMENTS (Leases) (Details) - USD ($)	Jan. 01, 2016	Jan. 02, 2015
Future minimum rental payments under capital leases
2016	$ 456,000
2017	190,000
2018	71,000
Total future minimum lease payments	717,000
Amount representing interest	$ (18,000)
Interest rate, minimum (as a percent)	3.25%
Interest rate, maximum (as a percent)	3.75%
Present value of net minimum lease payments under capital leases	$ 699,000
Less current portion	444,000	$ 324,000
Capital lease noncurrent	255,000	$ 306,000
Future minimum rental payments under non-cancelable operating leases
2016	2,300,000
2017	1,925,000
2018	1,338,000
2019	1,035,000
2020	558,000
Thereafter	1,147,000
Total future minimum lease payments	$ 8,303,000

COMMITMENTS (Lease Abandonment) (Details) - USD ($)	12 Months Ended
COMMITMENTS (Lease Abandonment) (Details) - USD ($)	Jan. 01, 2016	Jan. 02, 2015	Dec. 27, 2013
Operating leases rental income or expense
Rent expense and related charges for common area maintenance for all facility operating leases	$ 2,842,000	$ 3,004,000	$ 3,405,000
Reconciliation of the liability for lease abandonment (recovery) expense
Liability for abandoned leases as of the beginning of the year	44,000	122,000
Lease abandonment expense (recovery), net	(44,000)	9,000	30,000
Lease payments on abandoned leases, net of sublease payments	(11,000)	(153,000)
Other	$ (33,000)	66,000
Liability for abandoned leases as of the end of the year		$ 44,000	$ 122,000

COMMITMENTS (Benefit Plans) (Details) - USD ($)	12 Months Ended
COMMITMENTS (Benefit Plans) (Details) - USD ($)	Jan. 01, 2016	Jan. 02, 2015	Dec. 27, 2013
Employee Benefit Plans
Maximum employee contribution as a percentage of compensation under 401 (k) Plan	50.00%
Matching contributions by the company under 401(k) Plan	$ 777,000	$ 624,000	$ 507,000
Bonus expense under discretionary bonus plan	1,268,000	1,500,000	$ 262,000
Bonus expense included in accrued liabilities as of the balance sheet date	922,000	1,450,000
Post employment health benefits
Unamortized compensation cost	0
Present value of expected payments for health insurance coverage	$ 126,000	$ 139,000

INCOME TAXES (Details) - USD ($)	3 Months Ended								12 Months Ended
INCOME TAXES (Details) - USD ($)	Jan. 01, 2016	Oct. 02, 2015	Jul. 03, 2015	Apr. 03, 2015	Jan. 02, 2015	Sep. 26, 2014	Jun. 27, 2014	Mar. 28, 2014	Jan. 01, 2016	Jan. 02, 2015	Dec. 27, 2013
Provision (benefit) for income taxes
Current federal taxes									$ 983,000	$ 274,000	$ 88,000
Current state taxes									340,000	164,000	44,000
Deferred federal taxes (benefit)									1,295,000	(782,000)
Deferred state taxes (benefit)									464,000	(646,000)
Total provision (benefit) for income taxes	$ 210,000	$ 626,000	$ 1,108,000	$ 1,138,000	$ 366,000	$ (1,464,000)	$ 64,000	$ 44,000	$ 3,082,000	$ (990,000)	$ 132,000

INCOME TAXES (Sources) (Details) - USD ($)	3 Months Ended								12 Months Ended
INCOME TAXES (Sources) (Details) - USD ($)	Jan. 01, 2016	Oct. 02, 2015	Jul. 03, 2015	Apr. 03, 2015	Jan. 02, 2015	Sep. 26, 2014	Jun. 27, 2014	Mar. 28, 2014	Jan. 01, 2016	Jan. 02, 2015	Dec. 27, 2013
INCOME TAXES
U.S. federal statutory rate (as a percent)									34.00%	34.00%	34.00%
Sources and tax effects of the differences
Computed "expected" federal income tax expense (benefit)									$ 2,496,000	$ 2,864,000	$ 940,000
Permanent differences									90,000	139,000	93,000
Incentive stock options									205,000
Energy efficient commercial building deduction									(281,000)
Current and deferred state income tax (benefit) expense, net of federal benefit									482,000	586,000	(19,000)
Change in valuation allowances on deferred tax assets									73,000	(4,576,000)	(897,000)
Other									17,000	(3,000)	15,000
Total provision (benefit) for income taxes	$ 210,000	$ 626,000	$ 1,108,000	$ 1,138,000	$ 366,000	$ (1,464,000)	$ 64,000	$ 44,000	$ 3,082,000	$ (990,000)	$ 132,000

INCOME TAXES (Deferred Tax) (Details) - USD ($)	Jan. 01, 2016	Jan. 02, 2015	Dec. 27, 2013
Deferred tax assets:
Accounts receivable allowance	$ 303,000	$ 265,000	$ 156,000
Other accrued liabilities	1,618,000	1,482,000	764,000
Federal and state net operating losses	156,000	244,000	3,157,000
Intangible assets	3,891,000	4,016,000	4,571,000
Other	224,000	409,000	64,000
Total deferred tax assets	6,192,000	6,416,000	8,712,000
Valuation allowance	(73,000)		(4,576,000)
Net deferred tax assets	6,119,000	6,416,000	4,136,000
Deferred tax liabilities:
Deferred revenue	(5,510,000)	(4,878,000)	(4,125,000)
Fixed assets	(696,000)	(111,000)	(11,000)
Other	244,000
Deferred tax liability	(6,450,000)	(4,989,000)	$ (4,136,000)
Deferred Tax Assets, Net, Total		$ 1,427,000
Deferred Tax Liabilities, Net, Total	$ 331,000

INCOME TAXES (Operating Loss Carryovers and Unrecognized Tax Benefits) (Details) - USD ($)		12 Months Ended
	Jan. 02, 2015	Jan. 01, 2016
Income taxes
Reversal of valuation allowance	$ 4,600,000	$ 4,600,000
Valuation reserve related to California net operating losses		73,000
Unrecognized tax benefits	$ 0	0
State
Income taxes
Operating loss carryovers		$ 2,800,000

INCOME TAXES (Recent Accounting Pronouncements) - USD ($)	Jan. 01, 2016	Jan. 02, 2015
New Accounting Pronouncements
Current liabilities	$ 28,016,000	$ 18,447,000
ASU 2015-17 \| Early adoption effect
New Accounting Pronouncements
Current liabilities		(3,100,000)
Non-current assets		$ (3,100,000)

SEGMENT INFORMATION (Details)	3 Months Ended								12 Months Ended
SEGMENT INFORMATION (Details)	Jan. 01, 2016 USD ($)	Oct. 02, 2015 USD ($)	Jul. 03, 2015 USD ($)	Apr. 03, 2015 USD ($)	Jan. 02, 2015 USD ($)	Sep. 26, 2014 USD ($)	Jun. 27, 2014 USD ($)	Mar. 28, 2014 USD ($)	Jan. 01, 2016 USD ($) segment	Jan. 02, 2015 USD ($)	Dec. 27, 2013 USD ($)
SEGMENT INFORMATION
Number of reporting segments \| segment									4
Segment reconciliation
Contract revenue	$ 31,522,000	$ 33,511,000	$ 36,773,000	$ 33,297,000	$ 30,237,000	$ 28,187,000	$ 26,970,000	$ 22,686,000	$ 135,103,000	$ 108,080,000	$ 85,510,000
Depreciation and amortization									2,072,000	459,000	517,000
Interest (expense) income									(207,000)	(16,000)	(94,000)
Segment profit (loss) before income taxes									7,341,000	8,426,000	2,762,000
Income tax (benefit) expense	210,000	626,000	1,108,000	1,138,000	366,000	(1,464,000)	64,000	44,000	3,082,000	(990,000)	132,000
Net income (loss)	380,000	$ 782,000	$ 1,602,000	$ 1,495,000	2,047,000	$ 4,161,000	$ 1,893,000	$ 1,315,000	4,259,000	9,416,000	2,630,000
Segment assets	72,345,000				49,330,000				72,345,000	49,330,000	38,237,000
Engineering Services
Segment reconciliation
Contract revenue									45,997,000	40,783,000	35,217,000
Depreciation and amortization									359,000	191,000	214,000
Interest (expense) income									(10,000)	17,000	(68,000)
Energy Efficiency Services
Segment reconciliation
Contract revenue									74,123,000	52,941,000	36,041,000
Depreciation and amortization									1,525,000	212,000	223,000
Interest (expense) income									(194,000)	(33,000)	(25,000)
Public Finance Services
Segment reconciliation
Contract revenue									11,857,000	10,630,000	9,845,000
Depreciation and amortization									159,000	39,000	41,000
Interest (expense) income									(2,000)	2,000	(3,000)
Homeland Security Services
Segment reconciliation
Contract revenue									3,126,000	3,726,000	4,407,000
Depreciation and amortization									29,000	18,000	39,000
Interest (expense) income									(1,000)	(2,000)	2,000
Reporting Segments \| Engineering Services
Segment reconciliation
Segment profit (loss) before income taxes									4,666,000	4,008,000	1,125,000
Income tax (benefit) expense									1,959,000	(454,000)	53,000
Net income (loss)									2,707,000	4,462,000	1,072,000
Segment assets	13,641,000				11,166,000				13,641,000	11,166,000	10,436,000
Reporting Segments \| Energy Efficiency Services
Segment reconciliation
Segment profit (loss) before income taxes									2,499,000	4,814,000	710,000
Income tax (benefit) expense									1,049,000	(599,000)	45,000
Net income (loss)									1,450,000	5,413,000	665,000
Segment assets	34,686,000				11,769,000				34,686,000	11,769,000	10,305,000
Reporting Segments \| Public Finance Services
Segment reconciliation
Segment profit (loss) before income taxes									1,148,000	661,000	535,000
Income tax (benefit) expense									482,000	(64,000)	17,000
Net income (loss)									666,000	725,000	518,000
Segment assets	5,377,000				3,944,000				5,377,000	3,944,000	3,528,000
Reporting Segments \| Homeland Security Services
Segment reconciliation
Segment profit (loss) before income taxes									418,000	443,000	392,000
Income tax (benefit) expense									176,000	(49,000)	17,000
Net income (loss)									242,000	492,000	375,000
Segment assets	894,000				708,000				894,000	708,000	1,406,000
Unallocated Corporate
Segment reconciliation
Segment profit (loss) before income taxes									(1,390,000)	(1,500,000)
Income tax (benefit) expense									(584,000)	176,000
Net income (loss)									(806,000)	(1,676,000)
Segment assets	40,877,000				44,873,000				40,877,000	44,873,000	35,692,000
Intersegment
Segment reconciliation
Segment assets	$ (23,130,000)				$ (23,130,000)				$ (23,130,000)	$ (23,130,000)	$ (23,130,000)

SEGMENT INFORMATION (Unallocated Corporate Assets) (Details) - USD ($)	Jan. 01, 2016	Jan. 02, 2015	Dec. 27, 2013	Dec. 28, 2012
Assets:
Cash and cash equivalents	$ 16,487,000	$ 18,173,000	$ 6,661,000	$ 8,818,000
Prepaid expenses	2,082,000	2,244,000
Other receivables	177,000	208,000
Equipment and leasehold improvements, net	3,684,000	1,384,000
Other	504,000	535,000
Unallocated Corporate
Assets:
Cash and cash equivalents	14,385,000	20,371,000	7,341,000
Prepaid expenses	758,000	1,404,000	1,206,000
Intercompany receivables	82,845,000	85,259,000	114,800,000
Other receivables	49,000	19,000	73,000
Equipment and leasehold improvements, net	2,231,000	440,000	177,000
Investments in subsidiaries	23,130,000	23,130,000	23,130,000
Other	53,000	4,640,000	3,765,000
Total assets	$ 123,451,000	$ 135,263,000	$ 150,492,000

CONTINGENCIES (Details) - USD ($)		12 Months Ended
CONTINGENCIES (Details) - USD ($)	Jul. 16, 2014	Jan. 01, 2016
Contingencies
Maximum coverage per professional liability claim		$ 5,000,000
Annual aggregate coverage limit		$ 10,000,000
COSA \| Subsidiaries
Contingencies
Minimum revenue shortfall alleged in lawsuit	$ 9,000,000
Alleged cost to retain another consultant	130,000
Alleged costs associated with noticing and conducting public hearings	$ 83,052

QUARTERLY FINANCIAL INFORMATION (UNAUDITED) (Details) - USD ($)	3 Months Ended								12 Months Ended
	Jan. 01, 2016	Oct. 02, 2015	Jul. 03, 2015	Apr. 03, 2015	Jan. 02, 2015	Sep. 26, 2014	Jun. 27, 2014	Mar. 28, 2014	Jan. 01, 2016	Jan. 02, 2015	Dec. 27, 2013
QUARTERLY FINANCIAL INFORMATION (UNAUDITED)
Contract revenue	$ 31,522,000	$ 33,511,000	$ 36,773,000	$ 33,297,000	$ 30,237,000	$ 28,187,000	$ 26,970,000	$ 22,686,000	$ 135,103,000	$ 108,080,000	$ 85,510,000
Income from operations	456,000	1,641,000	2,804,000	2,629,000	2,405,000	2,651,000	1,941,000	1,312,000	7,530,000	8,309,000	2,608,000
Income tax expense (benefit)	210,000	626,000	1,108,000	1,138,000	366,000	(1,464,000)	64,000	44,000	3,082,000	(990,000)	132,000
Net income	$ 380,000	$ 782,000	$ 1,602,000	$ 1,495,000	$ 2,047,000	$ 4,161,000	$ 1,893,000	$ 1,315,000	$ 4,259,000	$ 9,416,000	$ 2,630,000
Earnings per share:
Basic (in dollars per share)	$ 0.05	$ 0.10	$ 0.20	$ 0.19	$ 0.27	$ 0.55	$ 0.26	$ 0.18	$ 0.54	$ 1.26	$ 0.36
Diluted (in dollars per share)	$ 0.05	$ 0.10	$ 0.20	$ 0.18	$ 0.26	$ 0.53	$ 0.25	$ 0.17	$ 0.52	$ 1.22	$ 0.35
Weighted-average shares outstanding:
Basic	7,888,000	7,862,000	7,824,000	7,765,000	7,618,000	7,507,000	7,405,000	7,397,000	7,834,000	7,488,000	7,355,000
Diluted	8,132,000	8,102,000	8,136,000	8,103,000	7,986,000	7,855,000	7,661,000	7,609,000	8,113,000	7,739,000	7,495,000
Adjustment of Costs Relating to Revenue	$ 512,000

SUBSEQUENT EVENTS (Details)					12 Months Ended
SUBSEQUENT EVENTS (Details)	Mar. 04, 2016 shares	Feb. 26, 2016 USD ($) installment $ / shares	Feb. 24, 2016 USD ($)	Jan. 15, 2015 USD ($)	Jan. 01, 2016 USD ($) $ / shares	Mar. 15, 2016 USD ($)	Jan. 02, 2015 $ / shares
Subsequent Event [Line Items]
Purchase price					$ 19,413,000
Cash paid at closing					$ 8,501,000
Common stock, par value (in dollars per share) \| $ / shares					$ 0.01		$ 0.01
BMO \| Term Note
Subsequent Event [Line Items]
Borrowings outstanding					$ 1,850,000
Amended Credit Facility
Borrowings outstanding					$ 1,850,000
BMO \| Maximum \| Revolving Credit Facility
Amended Credit Facility
Total consideration for all permitted acquisitions				$ 1,500,000
Subsequent Event \| Revolving Credit Facility
Amended Credit Facility
Total consideration for all permitted acquisitions		$ 4,150,000	$ 4,250,000
Subsequent Event \| BMO \| Revolving Credit Facility
Subsequent Event [Line Items]
Borrowings outstanding						$ 7,500,000
Amended Credit Facility
Amount equal to net income required to be maintained for each fiscal quarter ending thereafter (as a percent)		50.00%
Adjustments to the tangible net worth arising as a result of consummation of acquisition (as a percent)		80.00%
Total consideration for all permitted acquisitions		$ 10,500,000	$ 7,900,000
Restricted installment payments		4,600,000
Borrowings outstanding						$ 7,500,000
Subsequent Event \| BMO \| Minimum \| Revolving Credit Facility
Amended Credit Facility
Unrestricted cash		7,000,000
Subsequent Event \| BMO \| Maximum \| Revolving Credit Facility
Amended Credit Facility
Repurchase of common stock		7,000,000
Subsequent Event \| Genesys
Subsequent Event [Line Items]
Purchase price		12,600,000
Cash paid at closing		$ 6,000,000
Common stock shares issued \| shares	255,808
Common stock, par value (in dollars per share) \| $ / shares		$ 0.01
Common stock value		$ 2,000,000
Number of trading days		10 days
Cash payable in installments		$ 4,600,000
Number of monthly intallments \| installment		24

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Fiscal Years) (Details)	3 Months Ended	12 Months Ended
	Jan. 01, 2016	Jan. 01, 2016	Jan. 02, 2015	Dec. 27, 2013
Summary of Significant Accounting Policies [Line Items]
Length of fiscal period		364 days	371 days	364 days
Minimum
Summary of Significant Accounting Policies [Line Items]
Length of fiscal period	91 days	364 days
Maximum
Summary of Significant Accounting Policies [Line Items]
Length of fiscal period	98 days	371 days