2. Basis of Presentation and Significant Accounting Policies: Capitalized Software Development Costs (Policies)

3 Months Ended

Jan. 31, 2019

Policies

Capitalized Software Development Costs

Capitalized Software Development Costs

The Company follows the provisions of ASC 350-40, “Internal Use Software” (“ASC 350-40”). ASC 350-40 provides guidance for determining whether computer software is internal-use software, and on accounting for the proceeds of computer software originally developed or obtained for internal use and then subsequently sold to the public.  It also provides guidance on capitalization of the costs incurred for computer software developed or obtained for internal use. The Company expenses all costs incurred during the preliminary project stage of its development, and capitalizes the costs incurred during the application development stage. Costs incurred relating to upgrades and enhancements to the software are capitalized if it is determined that these upgrades or enhancements add additional functionality to the software. Costs incurred to improve and support products after they become available are charged to expense as incurred.

The Company capitalized $696,000 and $548,000 of software development costs for the three months ended January 31, 2019 and 2018, respectively.  The Company amortized $520,000 and $519,000 of capitalized software development costs for the three months ended January 31, 2019 and 2018, respectively. The Company records amortization of the software on a straight-line basis over the estimated useful life of the software, typically over five years within “Cost of Revenues”.