Note 3. Supplemental Financial Information

Balance Sheet Components

Financing receivables

A financing receivable is a contractual right to receive money, on demand or on fixed or determinable dates, that is recognized as an asset in the Company’s balance sheet. The Company’s financing receivables, consisting of its accounts receivable with contractual maturities of more than one year and sales-type leases, totaled $8.2 million and $7.4 million at March 31, 2018 and June 30, 2017, respectively, and are included in other assets in the unaudited condensed consolidated balance sheets. The Company evaluates the credit quality of an obligor at lease inception and monitors credit quality over the term of the underlying transactions. The Company performs a credit analysis for all new customers and reviews payment history, current order backlog, financial performance of the customers and other variables that augment or mitigate the inherent credit risk of a transaction. Such variables include the underlying value and liquidity of the collateral, the essential use of the equipment, the term of the lease and the inclusion of credit enhancements, such as guarantees, letters of credit or security deposits. The Company classifies accounts as high risk when it considers the financing receivable to be impaired or when management believes there is a significant near-term risk of non-payment. As of March 31, 2018, the sales-type lease portion of the financing receivables was rated at a moderate risk. The Company performed an assessment of the allowance for credit losses related to its financing receivables as of March 31, 2018 and June 30, 2017. Based upon such assessment, the Company did not record any adjustment and recorded $0.04 million to the allowance for credit losses related to such financing receivables as of March 31, 2018 and as of June 30, 2017, respectively.

A summary of the Company’s financing receivables is presented as follows (in thousands):

March 31, 2018	Lease Receivables			Financed Service Contracts and Other		Total
Gross	$	3,332		$	7,888	$	11,220
Unearned income		(301	)		—		(301	)
Allowance for credit loss		—			—		—
Total, net	$	3,031		$	7,888	$	10,919
Reported as:
Current	$	789		$	1,927		2,716
Non-current		2,242			5,961		8,203
Total, net	$	3,031		$	7,888	$	10,919

June 30, 2017	Lease Receivables			Financed Service Contracts and Other		Total
Gross	$	4,030		$	6,268	$	10,298
Unearned income		(433	)		—		(433	)
Allowance for credit loss		(39	)		—		(39	)
Total, net	$	3,558		$	6,268	$	9,826
Reported as:
Current	$	720		$	1,677	$	2,397
Non-current		2,838			4,591		7,429
Total, net	$	3,558		$	6,268	$	9,826

Actual cash collections may differ from the contracted maturities due to early customer buyouts, refinancing, or defaults. Future minimum lease payments to be received as of March 31, 2018 are presented as follows (in thousands):

Year Ending June 30,	Amount
2018 (remaining 3 months)	$	232
2019		930
2020		930
2021		930
2022		310
Total	$	3,332

Inventories

Inventories consisted of the following (in thousands):

	March 31, 2018		June 30, 2017
Raw materials	$	43,683	$	38,803
Work-in-process		18,622		15,471
Finished goods		53,595		50,780
Inventories	$	115,900	$	105,054

Property and equipment, net

Property and equipment, net consisted of the following (in thousands):

	March 31, 2018			June 30, 2017
Furniture and fixtures	$	2,961		$	4,364
Computer and office equipment		11,293			11,802
Software		11,314			11,457
Leasehold improvements		23,351			23,164
Machinery and equipment		46,904			48,742
Construction in progress		6,924			3,533
		102,747			103,062
Less: Accumulated depreciation		(78,285	)		(80,000	)
Property and equipment, net	$	24,462		$	23,062

Depreciation expense related to property and equipment for the three and nine months ended March 31, 2018 was $2.3 million and $7.3 million, respectively. Depreciation expense related to property and equipment for the three and nine months ended March 31, 2017 was $2.6 million and $7.9 million, respectively.

Accumulated Other Comprehensive Income (Loss)

The changes in accumulated other comprehensive income (loss) are excluded from earnings and reported as a component of stockholders’ equity. The foreign currency translation adjustment results from those subsidiaries not using the U.S. Dollar as their functional currency since the majority of their economic activities are primarily denominated in their applicable local currency. Accordingly, all assets and liabilities related to these operations are translated to the U.S. Dollar at the current exchange rates at the end of each period. Revenues and expenses are translated at average exchange rates in effect during the period.

The components of accumulated other comprehensive income (loss) in the equity section of the balance sheets are as follows (in thousands):

	March 31, 2018			June 30, 2017
Net unrealized gain (loss) on short-term investments	$	354		$	(89	)
Cumulative foreign currency translation adjustment		2,621			1,154
Defined benefit pension obligation		(1,117	)		(1,117	)
Accumulated other comprehensive income (loss)	$	1,858		$	(52	)