CAPITALIZED SOFTWARE COSTS

Capitalized software costs and accumulated amortization at

July 31, 2017

and

January 31, 2017

were as follows:

	July 31, 2017			January 31, 2017
	(in thousands)
Capitalized software costs:
Acquired software technology	$	3,458		$	3,458
Capitalized software development costs		1,069			748
		4,527			4,206
Less accumulated amortization		(3,727	)		(3,474	)
Capitalized software costs, net	$	800		$	732

Acquired software technology costs relate to technology purchased as a result of the Company’s fiscal

2013

acquisitions of DynaSys and CEBOS. In addition to the acquired software technology, the Company has capitalized costs related to translations and localizations of QAD Enterprise Applications.

It is the Company’s policy to write off capitalized software development costs once fully amortized. Accordingly, during the

first

six

months of fiscal

2018,

approximately

$0.2

million of costs and accumulated amortization were removed from the balance sheet.

Amortization of capitalized software costs was

$0.4

million and

$0.5

million for the

six

months ended

July 31, 2017

and

2016

respectively. Amortization of capitalized software costs is included in “Cost of license” in the accompanying Condensed Consolidated Statements of Operations and Comprehensive Loss.

The following table summarizes the estimated amortization expense relating to the Company’s capitalized software costs as of

July 31, 2017:

Fiscal Years	(in thousands)
2018 remaining	$	424
2019		197
2020		144
2021		35
	$	800