Property and Equipment

9 Months Ended

Jan. 31, 2022

Property, Plant and Equipment [Abstract]

Property and equipment is recorded at cost and primarily consists of laboratory equipment, furniture and fixtures, and computer equipment and software. Depreciation and amortization is calculated on a straight-line basis over the estimated useful lives of the various assets ranging from three to nine years. Property and equipment consisted of the following (table in thousands):


	January 31, 2022		April 30, 2021
Furniture and fixtures	$	246	$	246
Computer equipment and software	1,595		1,461
Capitalized software development costs	1,888		484
Laboratory equipment	8,090		6,640
Assets in progress	68		1,211
Leasehold improvements	112		4

Total property and equipment	11,999		10,046
Less: Accumulated depreciation and amortization	(5,008)		(3,956)

Property and equipment, net	$	6,991	$	6,090

Depreciation and amortization expense was $396,000 and $279,000 for the three months ended January 31, 2022 and 2021, respectively. Depreciation and amortization expense, excluding expense recorded under the finance lease, was $1.1 million and $757,000 for the nine months ended January 31, 2022 and 2021, respectively.

As of January 31, 2022 and April 30, 2021, property, plant and equipment included gross assets held under finance leases of $343,000. Related depreciation expense was approximately $0 and $18,000 for the three months ended January 31, 2022 and 2021, respectively, and approximately $0 and $124,000 for the nine months ended January 31, 2022 and 2021, respectively.

Capitalized software development costs under a hosting arrangement

The Company accounts for the cost of computer software obtained or developed for internal use as well as the software development and implementation costs associated with a hosting arrangement ("internal-use software") that is a service contract in accordance and with ASC 350, Intangibles - Goodwill and Other ("ASC-350"). We capitalize certain costs in the development of our internal-use software when the preliminary project stage is completed and it is probable that the project itself will be completed and the software will perform as intended. These capitalized costs include personnel and related expenses for employees and costs of third-party consultants who are directly associated with and who devote time to these internal-use software projects. Capitalization of these costs ceases once the project is substantially complete and the software is ready for its intended purpose. Costs incurred for significant upgrades, increased functionality, and enhancements to the Company's internal-use software solutions are also capitalized. Costs incurred for training, maintenance, and minor modifications are expensed as incurred. Capitalized software development costs are amortized using the straight-line method over an estimated useful economic life of three years.

The Company capitalizes development and implementation costs, in accordance with ASC-350, for its Lumin platform. Lumin is the Company's oncology data-driven software program and data tool which is classified as Software as a Service (SaaS). These capitalized costs represent salaries, including direct payroll-related costs, certain software development consultant expenses and molecular sequencing programming costs incurred in the engineering and coding of the software development. During the first quarter of fiscal 2021, the initial version of the Lumin platform was launched, at which time initial capitalization ceased and amortization commenced. Lumin was placed into service as of July 31, 2020 in the gross asset amount of $484,000.

During the second quarter of fiscal 2021 and through the third quarter of fiscal 2022, the Company continued to develop increased functionality, expand product design and usability, and add enhancements and significant upgrades to the Lumin platform. In accordance with accounting guidance, these costs were capitalized. This developmental work did not render the initial released version to be obsolete or diminished in value but, rather, added to the base level functionality of the existing platform. During the development period, capitalized costs were placed into assets in progress. During the third quarter of fiscal 2022, these capitalized costs were placed into service as the enhanced version was launched and made available for sale. The total cost of the enhanced Lumin asset placed into service during the three months ended January 31, 2022 was $1.4 million, bringing the total capitalized gross asset investment to $1.9 million. Amortization expense related to this asset was $79,000 and $40,000 for the three months ended January 31, 2022 and 2021, respectively, and $160,000 and $93,000 for the nine months ended January 31, 2022 and 2021, respectively.

Finance Lease

In December 2019, the Company entered into a finance lease for laboratory equipment. The lease had costs of approximately $231,000, at inception, through November 2020. The lease term expired December 2020. Depreciation and amortization expense related to this finance lease was zero and $53,000 for the three months ended January 31, 2022 and 2021, respectively, and zero and $106,000 for the nine-months ended January 31, 2022 and 2021, respectively. As of January 31, 2022 the asset has been fully depreciated and book value is nil.