Accounting for the Costs of Computer Software Developed for Internal Use

3 Months Ended

Jul. 31, 2013

Internal Use Software [Abstract]

Accounting for the Costs of Computer Software Developed for Internal Use

Note 10 - Accounting for the Costs of Computer Software Developed for Internal Use:

The Company has adopted the provisions of the Statement of Position 98-1 (SOP 98-1), “Accounting for the Costs of Computer Software Developed for Internal Use”.  SOP 98-1 requires companies to capitalize as long-lived assets many of the costs associated with developing or obtaining software for internal use and amortize those costs over the software’s estimated useful life in a systematic and rational manner.

The Company capitalized  $586,000 and $405,000 related to the development of software for internal use for the three months ended July 31, 2013 and July 31, 2012, respectively, of which $574,000 and $354,000 related to development costs for  the digital production software  project and $12,000 and $51,000 related to a new fulfillment system, respectively.  Such costs are capitalized and amortized over the expected useful life of the asset which is approximately from 3 to 5 years.  Total amortization expenses for the three months ended July 31, 2013 and July 31, 2012 were $402,000 and $295,000, respectively.