We cannot be certain that our business strategy will be successful or that we will successfully address these and other challenges, risks and uncertainties. For a further list and description of various risks, relevant factors and uncertainties that could cause future results or events to differ materially from those expressed or implied in our forward-looking statements, see the Item 1A, “Risk Factors” and Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections in the Form 10-K for the year ended March 31, 2012, as well as other reports that we file with the SEC.
We continue to invest in the most important advanced technology solutions, primarily cloud, collaboration, and managed services offerings by hiring top level engineers to enhance our solution set and delivery capabilities. We have restructured our solutions area into three specializations, Data Center, Collaboration, and Security. Through this structure, we expect to be able to bring better solutions to market, faster, and produce solutions which are more highly focused on meeting customer needs in today’s everchanging IT environment.
As a result of acquisitions and investment in geographic growth in the technology segment, our headcount increased 115 people, or 17%. About two thirds of the increase was due to acquisitions, and the remaining increase was organic as we invest in building our company. The majority of hires were sales and marketing focused which generally produces a lag in gross profit generation in relation to general and administrative expenditures.
Given our balance sheet resources and the core profitability of our franchise, we have the means to opportunistically acquire companies and hire people without leverage, impairing our capital position, or taking any outsized operational risks. We will continue to execute these opportunities as they arise, as a balanced program of acquisitions and new hires is the best way to programmatically and conservatively build this company.
Another area of investment has been our managed services, and it is gaining momentum. Starting about two years ago, we rebuilt our infrastructure and hired a new senior management team. Last quarter was our largest quarterly booking of new orders in our history. During the year, we announced that we can provide managed video conferencing services, and we are continuing to add new client-demand-driven solutions to meet customer needs. Managed services will ultimately produce a solid flow of recurring revenues and earnings which we believe will become a meaningful component of our overall business.
Before I turn the call over to Elaine, I’d like to touch on a few additional items that affected earnings this year.
In addition to the consideration paid to acquire companies, there are additional direct and indirect costs that affect our P&L, such as the cost of having our personnel deployed away from their regular jobs to be involved in the execution and integration of the acquired companies. By utilizing ePlus personnel in the process, we are increasing the likelihood of a successful closing and integration. While these investments may decrease earnings in the short run, we believe it is advantageous to acquire synergistic companies which can accelerate ePlus’ long term growth and competitiveness in the market, and we will continue to pursue acquisitions that fit our strategy.
In the fourth quarter, we recorded a $2.9 million reserve for credit losses due to the bankruptcy of a single customer, which was both a technology and financing customer. This customer had an unexpectedly rapid demise, having filed bankruptcy within 4 months of the first rumors of financial trouble hitting the press. To mitigate actual losses, we are aggressively pursuing equipment recovery, and taking all legal action possible to collect amounts due. Elaine will provide some additional information on the overall credit quality of our customers, which remains strong.
ePlus’ success has been driven by our ongoing commitment to deliver the most advanced technology offerings, with expert engineers and commitment to continuous training. We are leveraging the investments we have made in cloud enablement, security, virtualization, managed services and other data center technologies to expand our offerings, such as cloud assessment, enablement, and migration solutions. In combination with our acquisitions and hiring of new sales and engineering resources, we have gained new customers, sold more to existing customers, and continued to expand the products and services we offer to meet growing customer demands.
In addition, ePlus continues to gain increased recognition, and was recently named to CRN’s 2012 List of Tech Elite 250, , and multiple awards at Cisco Partner Summit 2012, including U.S. Theater Architecture Excellence - Data Center Partner of the Year, Nationals Architectural Excellence - Data Center Partner of the Year, Nationals Services Partner of the Year, and Nationals State, Local Government, and Education (SLED) Partner of the Year - East Area. The company was further recognized this past fiscal year by NASDAQ by being named to the Global Select Market.
We are also focused on improving shareholder value, as we continued our share repurchase program and during fiscal year, and bought approximately 735 thousand shares of our common stock for a total purchase price of $19.0 million. As a result, our fully diluted weighted average shares outstanding decreased from approximately 8.4 million to 8.2 million shares.
In summary, our strategy remains committed to investing in our people, acquiring new technology and delivery capabilities, expanding our national footprint, and lowering operating costs.. Our customers rely on us for the key elements of their IT infrastructure, including advanced technology solutions and services. We can also help improve our customers supply chain efficiency with OneSourceIT, our procurement portal that provides customers with a wide array of useful tools, such as the ability to search and source products online, track their assets, and provide spend management analytics. Another differentiator is our ability to offer financing, as a principal, to meet customer’s mission critical purchases as well as their budgetary and treasury requirements.. We believe we offer a set of solutions that are unique in the industry, and we are making the investments necessary to support future growth in the market.
At the end of this call, I’d be happy to answer any questions, but first, I’d like to turn the speaker over to Elaine Marion, our CFO.
Elaine D. Marion, Chief Financial Officer
Looking at the fourth quarter, revenues were $219.0 million, an increase of $43.0 million or 24.4%, as compared to $176.0 million for the prior year quarter. Revenue growth was primarily driven by a 26.3% increase in revenues from product and services which totaled $209.8 million, as compared to $166.1 million during the quarter ended March 31, 2011. Financing revenue and fee and other income totaled $9.2 million, a decrease of $752 thousand compared to $9.9 million during the quarter ended March 31, 2011.
The gross margin on products and services in our technology segment decreased to 17.6% compared to 18.1% in the same quarter last year. Our gross margin was affected by the mix between products and services, vendor incentives earned, and competitive pricing pressures on sales of software assurance, maintenance and services which are now presented on a net basis.
For the quarter, professional and other fees, salaries and benefits, and general and administrative expenses totaled $36.7 million, an increase of $6.0 million or 19.4%, as compared to $30.7 million during the quarter ended March 31, 2011. Salaries and benefit expenses increased $3.4 million compared to the prior year, due to 115 additional employees in our technology segment over the same quarter last year and increased commission expense due to the increase in gross profit. As Phil mentioned, during the quarter, we recorded a reserve for credit losses in our financing segment of $2.9 million, due to an unexpected and rapid deterioration of a customer which recently filed bankruptcy. This was an isolated event relating to a single customer and is neither indicative of a degradation of the credit quality of our portfolio, nor the result of changes to our credit policies. We continue to maintain high credit standards for new and existing customers and the credit quality of our portfolio remains strong.
Interest and financing costs totaled $366 thousand, a decrease of $131 thousand compared to the prior year, due to a reduction of the total non-recourse and recourse notes payable balances. At March 31, 2012, total notes payable were $28.1 million, as compared to $29.6 million at March 31, 2011.
For the quarter, net earnings totaled $3.9 million, or $0.49 per diluted share, as compared to $3.6 million, or $0.42 per diluted share, for the quarter ended March 31, 2011.
Moving on to our fiscal year results, total revenues increased 14.9% to $825.6 million, driven by a 16.4% increase in revenues in our technology sales business segment which were partially offset by a 12.3% decrease in revenues in our financing business segment. The decrease in revenues in our financing segment was due to lower earnings from our portfolio.
Professional and other fees totaled $11.7 million during the year ended March 31, 2012, a decrease of 23.7% from $15.4 million during the prior year. These decreases were primarily due to a reduction in fees related to the patent infringement litigation, which were $6.0 million and $10.5 million for the years ended March 31, 2012 and 2011, respectively.
Salaries and benefits expense increased 16.6% to $98.3 million, compared to $84.2 million during the prior year. This increase was driven by increases in the number of employees, additional commission expenses due to the increase in gross profits, as well as higher share-based compensation expense. Our technology sales business segment had 777 employees as of March 31, 2012, an increase of 115 from 662 at March 31, 2011, while there was a slight decrease in employees in the financing segment. We employed 833 staff members at March 31, 2012.
General and administrative expenses increased $5.8 million to $20.5 million, or 39.6% during the year ended March 31, 2012, primarily due to the reserve for credit losses previously discussed and higher expenses overall due to increased locations and employees.
As a result of the foregoing, net earnings for fiscal year 2012 decreased 1.5% to $23.4 million. Our earnings per diluted share were $2.84 as compared to $2.82 per diluted share for fiscal year 2011.
Turning to the balance sheet, as of March 31, 2012, we had $41.2 million of cash and cash equivalents and short term investments, as compared to $75.8 million the prior year. During the year we invested our excess cash in several areas, including $19.0 million for the repurchase of our common stock and $11.8 million for acquisitions. Accounts receivable increased 43.4% to $174.6 million as a result of increased sales of products and services, and a higher volume of product shipments at the end of the quarter. Our investments in leases and notes receivable increased 13.6% to $140.3 million as we continue to focus on increasing origination of our portfolio assets.
As of March 31, 2012, we had total shareholders’ equity of $219.6 million as compared to $212.0 million, and 8.2 million diluted shares outstanding as compared to 8.4 million as of March 31, 2011.
Regarding the restatement announced on May 31st, during the preparation of our financial statements for the fiscal year ended March 31, 2012, we reassessed the presentation of sales of third party software assurance, maintenance and services and concluded that these transactions should be presented on a net basis. We previously presented these transactions on a gross basis, primarily as a result of our determination that we were acting as a principal in the arrangement because the customer contracts are with us and not a third party service provider. However, we determined that we should be considered an agent in the transaction because a third party is responsible for the day to day provision of services under the contract.
Under net sales recognition, the cost paid to the third party service provider is recorded as a reduction to sales of products and services, resulting in net sales being equal to the gross profit on the transaction. This change affected our revenues and offsetting costs and expenses for the identified periods but did not affect net earnings, net earnings per common share or consolidated statements of cash flows. The restatement did not impact our underlying agreements with, or obligations to, our customers and third party service providers, nor the amount that we invoice to our customers. For fiscal year 2011, the adjustment decreased total revenues from $863.0 million to $718.5 million, and for fiscal year 2010, from $676.9 million to $550.6 million.
On a proforma basis, if revenues had been reported on a gross basis, total revenues for fiscal year 2012 would have been $1,018 million, as compared to gross revenues in Fiscal year 2011 of $863 million, an increase of 18.1%.
That completes our prepared remarks. We would like to open the line to questions.
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