Note 5 - Capitalized Software Development Costs

9 Months Ended

Dec. 31, 2016

Notes to Financial Statements

Research, Development, and Computer Software Disclosure [Text Block]

5. Capitalized Software Development Costs

The Company capitalizes costs for internal use software incurred during the application development stage that are included in research and development expenses. Costs related to preliminary project activities and post implementation activities are expensed as incurred. The Company capitalized

$0.5

million and

$0.3

million of research and development costs during the

three

months ended

December

31,

2016

and

2015,

respectively, and

$1.3

million and

$1.1

million during the

nine

months ended

December

31,

2016

and

2015,

respectively.

Capitalized software is amortized once the product is ready for its intended use, using the straight-line method over the estimated useful lives of the assets, which is

three

years. Amortization expense is included in the product cost of revenue and was

$0.3

million and

$0.1

million during the

three

months ended

December

31,

2016

and

2015,

respectively, and

$0.8

million and

$0.4

million during the

nine

months ended

December

31,

2016

and

2015,

respectively. The unamortized balance of capitalized software was

$2.1

million and

$1.7

million as of

December

31,

2016

and

March

31,

2016,

respectively.

Management continues to evaluate the capitalized software development costs across all product lines and did

not

identify any indicators which required impairment to be recorded during the

nine

months ended

December

31,

2016

or

2015.