REVENUE FROM CONTRACTS WITH CLIENTS

12 Months Ended

Sep. 30, 2023

Revenue from Contract with Customer [Abstract]

REVENUE FROM CONTRACTS WITH CLIENTS

REVENUE FROM CONTRACTS WITH CLIENTS

DSA

The DSA segment generates service revenue through drug discovery and development services. The DSA segment generates product revenue through internally-manufactured scientific instruments for life sciences research and the related software for use by pharmaceutical companies, universities, government research centers and medical research institutions under the Company’s BASi product line. Refer to Note 2 – Summary of Significant Accounting Policies for further discussion of DSA revenue and related accounting policies.

RMS

The RMS segment generates products revenue through the commercial production and sale of research models, diets and bedding and bioproducts. The RMS segment generates service revenue through GEMS, client-owned animal colony care, and health monitoring and diagnostics services related to research models. Refer to Note 2 – Summary of Significant Accounting Policies for further discussion of RMS revenue and related accounting policies.

Contract Assets and Liabilities from Contracts with Clients

The timing of revenue recognition, billings and cash collections results in billed receivables (trade receivables), contract assets (unbilled revenue), and contract liabilities (client deposits and deferred revenue) on the consolidated balance sheets.

The following table provides information about contract assets (trade receivables and unbilled revenue, excluding allowances for credit losses), and fees invoiced in advance (client deposits and deferred revenue):

	Balance at September 30, 2023		Balance at September 30, 2022
Contract Assets: Trade receivables	$	77,618	$	88,867
Contract Assets: Unbilled revenue	17,211		17,474
Contract liabilities: Client deposits	36,689		39,222
Contract liabilities: Deferred revenue	18,933		29,420

When the Company does not have the unconditional right to advanced billings, both advanced client payments and unpaid advanced client billings are excluded from deferred revenue, with the advanced billings also being excluded from client receivables. The Company excluded approximately $10,220 and $2,647 of unpaid advanced client billings from both client receivables and deferred revenue as of September 30, 2023 and September 30, 2022, respectively.

The Company expects a majority of deferred revenue to be recognized as revenue in fiscal year 2024.

Changes in the contract asset and the contract liability balances during the twelve months ended September 30, 2023 include the following:

•A change in the time frame for a right for consideration to become unconditional – Approximately 86% of unbilled revenue as of September 30, 2022, was billed during fiscal year 2023.

•A change in the time frame for a performance obligation to be satisfied – Approximately 80% of contract liabilities as of September 30, 2022, were recognized as revenue during fiscal year 2023.

Allowance for Credit Losses

The Company’s allowance for credit losses was $7,446 and $6,268 at September 30, 2023 and 2022, respectively. A summary of activity in our allowance for credit losses is as follows:

	Fiscal Years Ended September 30,
	2023		2022
Opening balance	$	6,268	$	668
Acquired	—		4,406
Charged to expense	1,271		1,220
Uncollectible invoices written off	(107)		(26)
Amounts collected	14		—
Ending balance	$	7,446	$	6,268