Quarterly report pursuant to Section 13 or 15(d)

Leases

v3.23.3
Leases
 3 Months Ended
Oct. 31, 2023
Leases [Abstract]  
Leases

Note 9 - Leases

 

The Company determines if an arrangement is or contains a lease at contract inception. The Company leases buildings, office space, and equipment through operating leases. Generally, a right-of-use asset, representing the right to use the underlying asset during the lease term, and a lease liability, representing the payment obligation arising from the lease, are recognized on the balance sheet at lease commencement based on the present value of the payment obligation. For operating leases, expense is recognized on a straight-line basis over the lease term. Short-term leases with an initial term of 12 months or less are not recorded on the balance sheet; the Company recognizes lease expense for these leases on a straight-line basis over the lease term. The Company primarily uses its incremental borrowing rate in determining the present value of lease payments as the Company’s leases generally do not provide an implicit rate.

 

The Company has lease agreements with (i) right-of-use asset payments and (ii) non-lease components (e.g. payments related to maintenance fees, utilities, etc.) which have generally been combined and accounted for as a single lease component. The Company’s leases have remaining terms of less than 1 year to 4 years, some of which include options to extend the leases for up to 3 years. The Company’s lease terms may include renewal options that are reasonably certain to be exercised and termination options that are reasonably certain not to be exercised.

 

Certain of the Company’s lease agreements include rental payments adjusted periodically for inflation or a market rate which are included in the lease liabilities.

 

Leases   Balance Sheet Classification   October 31,
2023		     July 31,
2023		  
Assets                    
Operating   Right-of-use assets   $ 3,405     $ 3,626  
Total lease assets       $ 3,405     $ 3,626  
                     
Liabilities                    
Current:                    
Operating   Current portion of operating lease liabilities   $ 920     $ 980  
                     
Non-current:                    
Operating   Operating lease liabilities, non-current     2,972       3,160  
Total lease liabilities       $ 3,892     $ 4,140  

 

For the three months ended October 31, components of lease cost were as follows:

 

Lease Cost   2023     2022  
Operating lease cost – net (a)   $ 141     $ 262  

 

(a) Net of $126 sublease income for the three months ended October 31, 2023.

 

The maturity of the Company’s lease liabilities as of October 31, 2023 is as follows:

 

Maturity of lease liabilities, years ending July 31,     Operating
leases		  
2024     $ 863  
2025       896  
2026       886  
2027       881  
2028       808  
Total lease payments       4,334  
Less: Interest (a)       (442 )
Present value of lease liabilities     $ 3,892  

 

  (a) Primarily calculated using the Company’s incremental borrowing rate.

 

Lease term and discount rate for the for the three months ended October 31 were as follows:

 

Lease term and discount rate   2023     2022  
Weighted-average remaining lease term (years):            
Operating leases     4.5 years       5.5 years  
                 
Weighted-average discount rate:                
Operating leases     5.1 %     5.1 %

 

See Note 5 for cash flow information on cash paid for amounts included in the measurement of lease liabilities for the three months ended October 31, 2023 and 2022.