19. Non-consolidated Variable Interest Entity

The Company, through its wholly owned subsidiary DP Engineering, effectively holds 48% membership interest in DP-NXA Consultants LLC (DP-NXA) upon the acquisition of DP Engineering on February 15, 2019.

DP-NXA was established to provide in industrial services that include civil, structural, architectural, electrical, fire protection, plumbing, mechanical consulting engineering services to customers. DP-NXA sub-contracts their work to its two owners, NXA Consultants LLC (NXA), which owns 52% of the entity, and DP Engineering. DP Engineering and NXA contributed $48 and $52, respectively, for 48% and 52% interest in DP-NXA. DP Engineering recorded the contributed cash as an equity investment.

Upon the acquisition of DP Engineering, the Company evaluated the nature of DP Engineering's investment in DP-NXA and determined that DP-NXA is a variable interest entity (“VIE”). The Company does not have the power to direct activities that most significantly impact DP-NXA, and therefore, cannot be DP-NXA’s primary beneficiary. Furthermore, the Company concluded that it did not hold a controlling financial interest in DP-NXA since NXA, the VIE's majority owner, makes all operation and business decisions. As a result, the Company did not consolidate the assets and liabilities of the VIE in our financial statements.

The Company's maximum exposure to loss is limited to the investment in the VIE. As of March 31, 2019, the Company has not made any additional contributions to DP-NXA and its maximum exposure to loss relating to this unconsolidated VIE was immaterial. As of March 31, 2019, the Company does not have existing guarantee in relation to DP-NXA and any third-party it contracted with.

The Company will reevaluate if DP-NXA meets the definition of a VIE upon specific reconsideration of events.

The following table presents the carrying amount and classification of the assets related to the Company’s variable interests in non-consolidated VIE and the maximum exposure to loss at March 31, 2019.

(In thousands)	March 31, 2019
Assets
Cash:
Checking account	$	155
Total assets		155
Liabilities
Credit card and other payables		1
Total liabilities		1
Total net assets		154
Maximum exposure to loss	$	154