CASH, CASH EQUIVALENTS AND INVESTMENTS

3 Months Ended

Apr. 30, 2023

CASH, CASH EQUIVALENTS AND INVESTMENTS

CASH, CASH EQUIVALENTS AND INVESTMENTS

NOTE 3 – CASH, CASH EQUIVALENTS AND INVESTMENTS

Cash and Cash Equivalents

The Company considers all liquid investments with original maturities of three months or less at the time of purchase to be cash equivalents.

At April 30, 2023 and January 31, 2023, certain amounts of cash equivalents were invested in a money market fund with net assets invested in high-quality money market instruments. Such investments include U.S. Treasury obligations; obligations of U.S. government agencies, authorities, instrumentalities or sponsored enterprises; and repurchase agreements secured by U.S. government obligations. Dividend income related to money market investments is recorded when earned. The balances of accrued dividends at April 30, 2023 and January 31, 2023 were $0.5 million and $0.3 million, respectively.

Short-Term Investments

Short-term investments as of April 30, 2023 and January 31, 2023 consisted solely of certificates of deposit purchased from the Bank (“CDs) with weighted average maturities of one year or less. The Company has the intent and ability to hold the CDs until they mature, and they are carried at cost plus accrued interest. Interest income is recorded when earned and is included in other income. At April 30, 2023 and January 31, 2023, the weighted average annual interest rates of the outstanding CDs were 5.2% and 2.5%, respectively. Interest income on CDs is recorded when earned. The balances of accrued interest on the CDs at April 30, 2023 and January 31, 2023 were $0.7 million and $1.8 million, respectively.

Available-For-Sale Securities

During the fiscal quarter ended April 30, 2023, the Company purchased U.S. Treasury notes with original maturities of two and three years. The Company’s available-for-sale securities consisted of the following amortized cost, allowance for credit losses, gross unrealized gains and losses and estimated fair value by contractual maturity as of April 30, 2023:

	April 30, 2023
			Allowance for		Gross		Gross		Estimated
	Amortized		Credit		Unrealized		Unrealized		Fair
	Cost		Losses		Gains		Losses		Value
U.S. Treasury notes:
Due in one to two years	$	15,014	$	—	$	—	$	37	$	14,977
Due in two to three years		15,399		—		—		—		15,399
Totals	$	30,413	$	—	$	—	$	37	$	30,376

As of April 30, 2023, interest receivable in the amount of $0.1 million is included in balance of available-for-sale securities on the condensed consolidated balance sheets. For the three months ended April 30, 2023, the change in net unrealized holding losses for the Company’s available-for-sale securities reported in other comprehensive income was not material. For the three months ended April 30, 2023, there were no sales of the Company’s available-for-sale securities, and therefore, there were no amounts of gains or losses reclassified out of other comprehensive income into net income. All

unrealized losses for the available-for-sale securities have been in a continuous loss position for less than 12 months. The Company does not believe the unrealized losses represent credit losses based on the evaluation of evidence as of April 30, 2023, which includes an assessment of whether it is more likely than not the Company will be required to sell the investment before recovery of the investment’s amortized cost basis.

Concentration Risk

The Company has a substantial portion of its cash on deposit in the U.S. with Bank of America, N.A.  (the “Bank”). The Company also maintains certain Euro-based bank accounts in Ireland and certain pound sterling-based bank accounts in the U.K. in support of the operations of APC. Management does not believe that the combined amount of the CDs and the cash deposited with the Bank and cash balances maintained at financial institutions in Ireland and the U.K., in excess of government-insured levels, represent material risks.