(

)

General

The accompanying unaudited condensed consolidated financial statements of Optical Cable Corporation and its subsidiaries (collectively, the “Company” or “OCC

”) have been prepared in accordance with U.S. generally accepted accounting principles for interim financial reporting information and the instructions to Form

-Q and Regulation S-

Accordingly, they do

not

include all of the information and notes required by U.S. generally accepted accounting principles for complete financial statements. In the opinion of management, all material adjustments considered necessary for a fair presentation have been included. Operating results for the

six

months ended

April 30, 2017

are

not

necessarily indicative of the results for the fiscal year ending

October

31,

2017

because the following items, among other things,

may

impact those results: changes in market conditions, seasonality, changes in technology, competitive conditions, ability of management to execute its business plans, as well as other variables, uncertainties, contingencies and risks set forth as risks in the Company’s Annual Report on Form

-K for the fiscal year ended

October

31,

2016

(including those set forth in the “Forward-Looking Information” section), or as otherwise set forth in other filings by the Company as variables, contingencies and/or risks possibly affecting future results. The unaudited condensed consolidated financial statements and condensed notes are presented as permitted by Form

-Q and do

not

contain certain information included in the Company’s annual consolidated financial statements and notes. For further information, refer to the consolidated financial statements and notes thereto included in the Company’s Annual Report on Form

-K for the fiscal year ended

October

31,

2016.

April 2015,

the FASB issued Accounting Standards Update

2015

03,

Simplifying the Presentation of Debt Issuance Costs

("ASU

2015

03"

). ASU

2015

requires debt issuance costs to be presented in the balance sheet as a direct deduction from the carrying value of the associated debt liability, consistent with the presentation of a debt discount. Prior to the issuance of the standard, debt issuance costs were required to be presented in the balance sheet as an asset. In

August 2015,

the FASB issued Accounting Standards Update

2015

15,

Interest - Imputed Interest (Subtopic

835

): Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line-of-Credit Arrangements

(“ASU

2015

15”

) which clarified that entities

may

continue to defer and present debt issuance costs associated with a line-of-credit as an asset and subsequently amortize the deferred costs ratably over the term of the arrangement. This guidance is effective for fiscal years, and interim periods within those years, beginning after

December 15, 2015.

The new guidance must be applied retrospectively to all prior reporting periods presented. The Company adopted ASU

2015

effective

November 1, 2016.

The adoption did

not

have a material impact on our results of operations, financial position or liquidity or our related financial statement disclosures.

November 2015,

the FASB issued Accounting Standards Update

2015

17,

Income Taxes

(“ASU

2015

17”

). ASU

2015

requires that deferred tax liabilities and assets be classified as noncurrent in a classified statement of financial position. ASU

2015

is effective for financial statements issued for annual periods beginning after

December 15, 2016,

and interim periods within those periods, with early adoption permitted. The Company adopted ASU

2015

effective

November 1, 2016.

The adoption did

not

have a material impact on our results of operations, financial position or liquidity or our related financial statement disclosures.