Accounting for the Costs of Computer Software Developed for Internal Use

9 Months Ended

Jan. 31, 2012

Internal Use Software [Abstract]

Accounting for the Costs of Computer Software Developed for Internal Use:

Note 12-Accounting for the Costs of Computer Software Developed for Internal Use:

The Company has adopted the provisions of the Statement of Position 98-1 (SOP 98-1), “Accounting for the Costs of Computer Software Developed for Internal Use”. SOP 98-1 requires companies to capitalize as long-lived assets many of the costs associated with developing or obtaining software for internal use and amortize those costs over the software’s estimated useful life in a systematic and rational manner.

The Company capitalized $2,992,000 and $662,000 related to the development of software for internal use for the nine months ended January 31, 2012 and 2011, respectively, of which $1,876,000 related to development costs for the digital production software project and $1,116,000 related to a new fulfillment system. Such costs are capitalized and amortized over the expected useful life of the asset which is approximately from 3 to 5 years. Amortization expense for the nine months ended January 31, 2012 and 2011 was $191,000 and $219,000, respectively.

The new fulfillment system was placed in service on December 1, 2011. The Company’s refreshed website, Single Sign On (“SSO”) and new e-commerce and website shopping cart were also placed in service during December 2011. A new institutional sales website ValueLinePro.com was launched by the Company during March 2012.