Dependence Upon Major Customers

The Company is not dependent on any one or a few major customers. Sales to four customers approximated 37% (15%, 8%, 8%, and 5%, respectively) of net sales for 2022. The loss of any or all of these customers, unless the business is replaced by the Company, could result in an adverse effect on the results for the Company.

Patents, Trademarks and Licenses

The Company holds 6 patents expiring at different times until the year 2035.

Terms of Sale

The Company does not carry significant inventory for rapid delivery to customers, and goods are not normally sold with return rights such as are available for consignment sales. The Company had no inventory out on consignment and no consignment sales for the years ended May 31, 2022 and 2021. No extended payment terms are offered. During the year ended May 31, 2022, delivery time after receipt of orders averaged 8 to 10 weeks for the Company's standard products. Due to the volatility of structural and aerospace/defense programs, progress payments are usually required for larger projects using custom designed components of the Company.

Need for Government Approval of Principal Products or Services

Contracts between the Company and the federal government or its independent contractors are subject to termination at the election of the federal government. Contracts are generally entered into on a fixed price basis. If the federal government should limit defense spending, these contracts could be reduced or terminated, which management believes would have a materially adverse effect on the Company.

Research and Development

To accommodate growth and to maintain its presence in current markets, the Company engages in product research and development activities in connection with the design of its products. Occasionally, research and development for products in the aerospace and defense sectors is funded by customers or the federal government. The Company also engages in research testing of its products. For the fiscal years ended May 31, 2022 and 2021, the Company expended $1,213,000 and $924,000, respectively, on product research. This increase is primarily due to research and development that will aid in accommodating planned growth in multiple sectors. For the years ended May 31, 2022 and 2021, defense sponsored research and development totaled $334,000 and $243,000, respectively.

Government Regulation

Compliance with federal, state, and local laws and regulations which have been enacted or adopted regulating the discharge of materials into the environment has had no material effect on the Company, and the Company believes that it is in substantial compliance with such provisions.

The Company is subject to the Occupational Safety and Health Act ("OSHA") and the rules and regulations promulgated thereunder, which establish strict standards for the protection of employees, and impose fines for violations of such standards. The Company believes that it is in substantial compliance with OSHA provisions and does not anticipate any material corrective expenditures in the near future. The Company currently incurs only moderate costs with respect to disposal of hazardous waste and compliance with OSHA regulations.

The Company is also subject to regulations relating to production of products for the federal government. These regulations allow for frequent governmental audits of the Company's operations and fairly extensive testing of Company products. The Company believes that it is in substantial compliance with these regulations and does not anticipate corrective expenditures in the future.

Employees

Exclusive of Company sales representatives and distributors, as of May 31, 2022, the Company had 123 employees, including five executive officers. The Company has good relations with its employees.

-5-

Item 1A. Risk Factors.

Smaller reporting companies are not required to provide the information required by this item.

Item 1B. Unresolved Staff Comments.

Not applicable.

Item 2. Properties.

The Company's production facilities occupy approximately six acres on Tonawanda Island in North Tonawanda, New York and are comprised of four interconnected buildings and two adjacent buildings. The production facilities consist of a small parts plant (approximately 4,400 square feet), a large parts plant (approximately 13,500 square feet), and include a facility of approximately 7,000 square feet comprised of a test facility, storage area, pump area and the Company's general offices. One adjacent building is a 27,000 square foot seismic assembly and test facility. This building contains overhead traveling cranes to allow dampers to be built up to 45 ft. in length. It is also the site of two long bed damper test machines where seismic dampers Taylor Devices manufactures will be tested at maximum force to satisfy customer specifications. Another adjacent building (approximately 2,000 square feet) is used as a training facility. These facilities total more than 54,000 square feet. Adjacent to these facilities, the Company has a remote test facility used for shock testing. This state-of-the-art test facility is 1,200 square feet. The Company owns two additional industrial buildings on nine acres of land in the City of North Tonawanda located 1.4 miles from the Company’s headquarters on Tonawanda Island. Total area of the two buildings is 46,000 square feet. One building includes a machine shop containing custom-built machinery for boring, deep-hole drilling and turning of parts. Another is used for painting and packaging parts and completed units.

The Company's real properties are subject to a negative pledge agreement with its lender, M&T Bank. The Company has agreed with the lender that, for so long as the credit facilities with the lender are outstanding, the Company will not sell, lease or mortgage any of its real properties. Additional information regarding the Company's agreement with M&T Bank is contained in Item 7, Management's Discussion and Analysis of Financial Condition and Results of Operations, at "Capital Resources, Line of Credit and Long-Term Debt."

The Company believes it carries adequate insurance coverage on its facilities and their contents.

Item 3. Legal Proceedings.

There are no legal proceedings at present.

Item 4. Mine Safety Disclosures.

Not applicable.

-6-

PART II

Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.

Market Information

The Company's Common Stock trades on the NASDAQ Capital Market of the National Association of Securities Dealers Automated Quotation ("NASDAQ") stock market under the symbol TAYD. The high and low sales information noted below for the quarters of fiscal year 2022 and fiscal year 2021 were obtained from NASDAQ.

	Fiscal 2022				Fiscal 2021
	High		Low		High		Low
First Quarter	$	12.25	$	11.21	$	11.46	$	8.68
Second Quarter	$	12.00	$	10.93	$	10.54	$	8.58
Third Quarter	$	11.00	$	9.88	$	11.93	$	9.76
Fourth Quarter	$	10.24	$	8.75	$	12.43	$	10.58

Holders

As of May 31, 2022, the number of issued and outstanding shares of Common Stock was 3,497,937 and the number of record holders of the Company's Common Stock was 461. A substantial number of shares of the Company's Common Stock are held in street name. The Company believes that the total number of beneficial owners of its Common Stock is less than 1,300.

Dividends

No cash or stock dividends have been declared during the last two fiscal years. The Company plans to retain cash in the foreseeable future to fund working capital needs.

Rights Plan

As of September 25, 2018, the Company's Board of Directors adopted a shareholder rights plan designed to deter coercive or unfair takeover tactics and prevent an acquirer from gaining control of the Company without offering a fair price to shareholders. Under the plan, certain rights ("Rights") were distributed as a dividend on each share of Common Stock (one Right for each share of Common Stock) held as of the close of business on October 2, 2018. Each whole Right entitles the holder, under certain defined conditions, to buy one two-thousandths (1/2000) of a newly issued share of the Company's Series A Junior Participating Preferred Stock ("Series A Preferred Stock") at a purchase price of $5.00 per unit of one two-thousandths of a share. Rights attach to and trade with the shares of Common Stock, without being evidenced by a separate certificate. No separate Rights certificates will be issued unless and until the Rights detach from Common Stock and become exercisable for shares of the Series A Preferred Stock.

The Rights become exercisable to purchase shares of Preferred Stock (or, in certain circumstances, Common Stock) only if (i) a person acquired 15% or more of the Company's Common Stock, or (ii) a person commenced a tender or exchange offer for 10% or more of the Company's Common Stock, or (iii) the Board of Directors determined that the beneficial owner of at least 10% of the Company's Common Stock intended to cause the Company to take certain actions adverse to it and its shareholders or that such ownership would have a material adverse effect on the Company. The Rights Plan will expire on October 5, 2028.

Issuer Purchases of Equity Securities

A share repurchase agreement with a major broker-dealer, under which the Company repurchased shares of its common stock on the open market, has been terminated by the Company. No shares have been purchased since August 2011.

-7-

Equity Compensation Plan Information

The following table sets forth information regarding equity compensation plans of the Company as of May 31, 2022.

		Equity Compensation Plan Information
Plan Category		Number of securities to be issued upon exercise of outstanding options, warrants, and rights (a)	Weighted-average exercise price of outstanding options, warrants and rights (b)	Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a)) (c)
Equity compensation plans approved by security holders:
2008 Stock Option Plan 2012 Stock Option Plan 2015 Stock Option Plan 2018 Stock Option Plan		4,750 52,000 90,000 136,250	$ 8.06 $11.30 $12.72 $10.75	- - - 23,750
Equity compensation plans not approved by security holders:
2004 Employee Stock Purchase Plan (1)		-	-	217,287
Total		283,000		241,037

(1)	The Company's 2004 Employee Stock Purchase Plan (the "Employee Plan") permits eligible employees to purchase shares of the Company's common stock at fair market value through payroll deductions and without brokers' fees. Such purchases are without any contribution on the part of the Company. As of May 31, 2022, 217,287 shares were available for issuance.

Item 6. Selected Financial Data.

The Company qualifies as a smaller reporting company, as defined by 17 CFR §229.10(f)(1) and is not required to provide the information required by this Item.

Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations.

Cautionary Statement

The Private Securities Litigation Reform Act of 1995 provides a "safe harbor" for forward-looking statements. Information in this Item 7, "Management's Discussion and Analysis of Financial Condition and Results of Operations" and elsewhere in this 10-K that does not consist of historical facts are "forward-looking statements." Statements accompanied or qualified by, or containing, words such as "may," "will," "should," "believes," "expects," "intends," "plans," "projects," "estimates," "predicts," "potential," "outlook," "forecast," "anticipates," "presume," "assume" and "optimistic" constitute forward-looking statements and, as such, are not a guarantee of future performance. The statements involve factors, risks and uncertainties, the impact or occurrence of which can cause actual results to differ materially from the expected results described in such statements. Risks and uncertainties can include, among others, fluctuations in general business cycles and changing economic conditions; variations in timing and amount of customer orders; changing product demand and industry capacity; increased competition and pricing pressures; advances in technology that can reduce the demand for the Company's products, as well as other factors, many or all of which may be beyond the Company's control. Consequently, investors should not place undue reliance on forward-looking statements as predictive of future results. The Company disclaims any obligation to release publicly any updates or revisions to the forward-looking statements herein to reflect any change in the Company's expectations with regard thereto, or any changes in events, conditions or circumstances on which any such statement is based.

-8-

Application of Critical Accounting Policies and Estimates

The Company's consolidated financial statements and accompanying notes are prepared in accordance with U.S. generally accepted accounting principles. The preparation of the Company's financial statements requires management to make estimates, assumptions and judgments that affect the amounts reported. These estimates, assumptions and judgments are affected by management's application of accounting policies, which are discussed in Note 1, "Summary of Significant Accounting Policies", and elsewhere in the accompanying consolidated financial statements. As discussed below, our financial position or results of operations may be materially affected when reported under different conditions or when using different assumptions in the application of such policies. In the event estimates or assumptions prove to be different from actual amounts, adjustments are made in subsequent periods to reflect more current information. Management believes the following critical accounting policies affect the more significant judgments and estimates used in the preparation of the Company's financial statements.

Accounts Receivable

Our ability to collect outstanding receivables from our customers is critical to our operating performance and cash flows. Accounts receivable are stated at an amount management expects to collect from outstanding balances. Management provides for probable uncollectible accounts through a charge to earnings and a credit to a valuation allowance based on its assessment of the current status of individual accounts after considering the age of each receivable and communications with the customers involved. Balances that are collected, for which a credit to a valuation allowance had previously been recorded, result in a current-period reversal of the earlier transaction charging earnings and crediting a valuation allowance. Balances that are still outstanding after management has used reasonable collection efforts are written off through a charge to the valuation allowance and a credit to accounts receivable in the current period. The actual amount of accounts written off over the five year period ended May 31, 2022 equaled less than 0.3% of sales for that period. The balance of the valuation allowance has increased to $16,000 at May 31, 2022 from $7,000 at May 31, 2021. Management does not expect the valuation allowance to materially change in the next twelve months for the current accounts receivable balance.

Inventory

Inventory is stated at the lower of average cost or net realizable value. Average cost approximates first-in, first-out cost.

Maintenance and other inventory represent stock that is estimated to have a product life-cycle in excess of twelve-months. This stock represents certain items the Company is required to maintain for service of products sold, and items that are generally subject to spontaneous ordering.

This inventory is particularly sensitive to technical obsolescence in the near term due to its use in industries characterized by the continuous introduction of new product lines, rapid technological advances, and product obsolescence. Therefore, management of the Company has recorded an allowance for potential inventory obsolescence. Based on certain assumptions and judgments made from the information available at that time, we determine the amount in the inventory allowance. If these estimates and related assumptions or the market changes, we may be required to record additional reserves. Historically, actual results have not varied materially from the Company's estimates.

During fiscal 2021, the Company began a thorough review of the facilities including the flow of inventory through the factory and warehouse areas to determine the most efficient utilization of available space. This review continued through fiscal 2022. Inventory purchasing practices and stocking levels were also evaluated and it was determined that a significant portion of the older items would be disposed of while the allowance for potential inventory obsolescence would be increased as more items are identified for disposal. There was $772,000 and $1,101,000 of inventory disposed of during the years ended May 31, 2022 and 2021. The provision for potential inventory obsolescence was zero and $1,500,000 for the years ended May 31, 2022 and 2021.

Revenue Recognition

Revenue is recognized when, or as, the Company transfers control of promised products or services to a customer in an amount that reflects the consideration to which the Company expects to be entitled in exchange for transferring those products or services.

-9-

A performance obligation is a promise in a contract to transfer a distinct good or service to the customer and is the unit of account. A contract’s transaction price is allocated to each distinct performance obligation and recognized as revenue when, or as, the performance obligation is satisfied. The majority of our contracts have a single performance obligation as the promise to transfer the individual goods or services is not separately identifiable from other promises in the contracts which are, therefore, not distinct. Promised goods or services that are immaterial in the context of the contract are not separately assessed as performance obligations.

For contracts with customers in which the Company satisfies a promise to the customer to provide a product that has no alternative use to the Company and the Company has enforceable rights to payment for progress completed to date inclusive of profit, the Company satisfies the performance obligation and recognizes revenue over time (generally less than one year), using costs incurred to date relative to total estimated costs at completion to measure progress toward satisfying our performance obligations. Incurred cost represents work performed, which corresponds with, and thereby best depicts, the transfer of control to the customer. Contract costs include labor, material and overhead. Total estimated costs for each of the contracts are estimated based on a combination of historical costs of manufacturing similar products and estimates or quotes from vendors for supplying parts or services towards the completion of the manufacturing process. Adjustments to cost and profit estimates are made periodically due to changes in job performance, job conditions and estimated profitability, including those arising from final contract settlements. These changes may result in revisions to costs and income and are recognized in the period in which the revisions are determined. Any losses expected to be incurred on contracts in progress are charged to operations in the period such losses are determined. If total costs calculated upon completion of the manufacturing process in the current period for a contract are more than the estimated total costs at completion used to calculate revenue in a prior period, then the profits in the current period will be lower than if the estimated costs used in the prior period calculation were equal to the actual total costs upon completion. Historically, actual results have not varied materially from the Company's estimates. Other sales to customers are recognized upon shipment to the customer based on contract prices and terms. In the year ended May 31, 2022, 60% of revenue was recorded for contracts in which revenue was recognized over time while 40% was recognized at a point in time. In the year ended May 31, 2021, 43% of revenue was recorded for contracts in which revenue was recognized over time while 57% was recognized at a point in time.

For financial statement presentation purposes, the Company nets progress billings against the total costs incurred and estimated earnings on uncompleted contracts. The asset, "costs and estimated earnings in excess of billings," represents revenues recognized in excess of amounts billed. The liability, "billings in excess of costs and estimated earnings," represents billings in excess of revenues recognized.

Income Taxes

The provision for income taxes provides for the tax effects of transactions reported in the financial statements regardless of when such taxes are payable. Deferred tax assets and liabilities are recognized for the expected future tax consequences of temporary differences between the tax and financial statement basis of assets and liabilities. The deferred tax assets relate principally to asset valuation allowances such as inventory obsolescence reserves and bad debt reserves and also to liabilities including warranty reserves, accrued vacation, accrued commissions and others. The deferred tax liabilities relate primarily to differences between financial statement and tax depreciation. Deferred taxes are based on tax laws currently enacted with tax rates expected to be in effect when the taxes are actually paid or recovered.

Realization of the deferred tax assets is dependent on generating sufficient taxable income at the time temporary differences become deductible. The Company provides a valuation allowance to the extent that deferred tax assets may not be realized. A valuation allowance has not been recorded against the deferred tax assets since management believes it is more likely than not that the deferred tax assets are recoverable. The Company considers future taxable income and potential tax planning strategies in assessing the need for a potential valuation allowance. In future years the Company will need to generate approximately $4.2 million of taxable income in order to realize our deferred tax assets recorded as of May 31, 2022 of $876,000. This deferred tax asset balance is 7% ($61,000) more than at the end of the prior year. The amount of the deferred tax assets considered realizable however, could be reduced in the near term if estimates of future taxable income are reduced. If actual results differ from estimated results or if the Company adjusts these assumptions, the Company may need to adjust its deferred tax assets or liabilities, which could impact its effective tax rate.

The Company's practice is to recognize interest related to income tax matters in interest income / expense and to recognize penalties in selling, general and administrative expenses.

The Company and its subsidiary file consolidated Federal and State income tax returns. As of May 31, 2022, the Company had State investment tax credit carryforwards of approximately $389,000 expiring through May 2027.

-10-

Results of Operations

A summary of the period-to-period changes in the principal items included in the consolidated statements of income is shown below:

Summary comparison of the years ended May 31, 2022 and 2021
	Increase /
	(Decrease)
Sales, net	$	8,357,000
Cost of goods sold	$	2,904,000
Selling, general and administrative expenses	$	628,000
Income before provision for income taxes	$	1,875,000
Provision for income taxes	$	698,000
Net income	$	1,177,000

For the year ended May 31, 2022 (All figures being discussed are for the year ended May 31, 2022 as compared to the year ended May 31, 2021.)

	Year ended May 31						Change
	2022			2021			Amount		Percent
Net Revenue	$	30,867,000		$	22,510,000		$	8,357,000		37	%
Cost of sales		22,239,000			19,335,000			2,904,000		15	%
Gross profit	$	8,628,000		$	3,175,000		$	5,453,000		172	%
… as a percentage of net revenues		28	%		14	%

The Company's consolidated results of operations showed a 37% increase in net revenues and an increase in net income of 110%. Revenues recorded in the current period for long-term construction projects (“Project(s)”) were 92% more than the level recorded in the prior year. We had 45 Projects in process during the current period compared with 41 during the same period last year. Revenues recorded in the current period for other-than long-term construction projects (non-projects) were 4% less than the level recorded in the prior year. The number of Projects in-process fluctuates from period to period. The changes from the prior period to the current period are not necessarily representative of future results.

Sales of the Company's products are made to three general groups of customers: industrial, structural and aerospace / defense. The Company saw a 60% increase from last year’s level in sales to structural customers who were seeking seismic / wind protection for either construction of new buildings and bridges or retrofitting existing buildings and bridges along with a 22% increase in sales to customers in aerospace / defense and a 1% decrease in sales to customers using our products in industrial applications. The significant increase in sales to structural customers is primarily from domestic customers.

A breakdown of sales to these three general groups of customers, as a percentage of total net revenue for fiscal years ended May 31, 2022 and 2021 is as follows:

	Year ended May 31
	2022			2021
Industrial		7	%		10	%
Structural		53	%		45	%
Aerospace / Defense		40	%		45	%

-11-

Total sales within North America increased 52% from last year. Total sales to Asia decreased 5% from the prior year. Net revenue by geographic region, as a percentage of total net revenue for fiscal years ended May 31, 2022 and 2021 is as follows:

	Year ended May 31
	2022			2021
North America		78	%		70	%
Asia		14	%		20	%
Other		8	%		10	%

The gross profit as a percentage of net revenue of 28% in the current period is double the 14% recorded in the same period of the prior year. The significant increase in gross profit as a percentage of revenue is primarily due to the increase in domestic sales to structural customers. The prior year results were adversely affected by the pandemic.

At May 31, 2021, we had 132 open sales orders in our backlog with a total sales value of $22.0 million. At May 31, 2022, we had 135 open sales orders in our backlog with a total sales value of $23.7 million. $7.6 million of the current backlog is on Projects already in progress. $9.3 million of the $22.0 million sales order backlog at May 31, 2021 was in progress at that date. 41% of the sales value in the backlog is for aerospace / defense customers compared to 43% at the end of fiscal 2021. As a percentage of the total sales order backlog, orders from structural customers accounted for 50% at May 31, 2022 and 55% at May 31, 2021.

The Company's backlog, revenues, commission expense, gross margins, gross profits, and net income fluctuate from period to period. Total sales in the current period and the changes in the current period compared to the prior period, are not necessarily representative of future results.

Selling, General and Administrative Expenses

	Year ended May 31						Change
	2022			2021			Amount			Percent
Outside Commissions	$	495,000		$	719,000		$	(224,000	)		-31	%
Other SG&A		5,660,000			4,808,000			852,000			18	%
Total SG&A	$	6,155,000		$	5,527,000		$	628,000			11	%
… as a percentage of net revenues		20	%		25	%

Selling, general and administrative expenses increased 11% from the prior year. Outside commission expense decreased 31% from last year's level due to the significant decrease in the level of commissionable sales recorded in the current period as compared to the prior period. Other selling, general and administrative expenses increased 18% from last year. The Company reduced its reliance on outside manufacturers’ representatives in FY22 and increased its internal sales force in an effort to increase profitable sales. This is the primary reason that the level of commissionable sales has decreased while the other SG&A expenses have increased.

The above factors resulted in operating income of $2,473,000 for the year ended May 31, 2022, showing significant improvement from the $2,352,000 operating loss in the prior year.

Other income during the prior period includes $2,972,000 of financial assistance provided by the U.S. federal government as part of the Coronavirus Aid, Relief and Economic Security (CARES) Act and the Consolidated Appropriations Act of 2021 (CAA): a.) $1,462,000 of income due to the forgiveness of the loan by the Small Business Administration (SBA) under the Paycheck Protection Program (PPP), and b.) $1,510,000 of Employee Retention Credit (ERC) income. Other income during the current period includes ERC income of $54,000.

The Company's effective tax rate (ETR) is calculated based upon current assumptions relating to the year's operating results and various tax related items. The ETR for the fiscal year ended May 31, 2022 is 12%, compared to the ETR for the prior year of -56%.

-12-

A reconciliation of provision for income taxes at the statutory rate to income tax provision at the Company's effective rate is as follows:

	2022			2021
Computed tax provision at the expected statutory rate	$	538,000		$	143,000
Tax effect of permanent differences:
Research tax credits		(275,000	)		(218,000	)
Foreign-derived intangible income deduction		(12,000	)		—
U.S. Government PPP loan forgiven		—			(307,000	)
Other permanent differences		3,000			42,000
Other		63,000			(41,000	)
	$	317,000		$	(381,000	)

The foreign-derived intangible income deduction is a tax deduction provided to corporations that sell goods or services to foreign customers. It became available through Public Law 115-97, known as the Tax Cuts and Jobs Act. The legislation that created the PPP and permitted the SBA to forgive loans made through the PPP also directed that the forgiven loan would not be taxable income to the recipient.

Stock Options

The Company has stock option plans which provide for the granting of nonqualified or incentive stock options to officers, key employees and non-employee directors. Options granted under the plans are exercisable over a ten-year term. Options not exercised by the end of the term expire.

The Company measures compensation cost arising from the grant of share-based payments to employees at fair value and recognizes such cost in income over the period during which the employee is required to provide service in exchange for the award. The Company recognized $201,000 and $154,000 of compensation cost for the years ended May 31, 2022 and 2021.

The fair value of each stock option grant has been determined using the Black-Scholes model. The model considers assumptions related to exercise price, expected volatility, risk-free interest rate, and the weighted average expected term of the stock option grants. The Company used a weighted average expected term. Expected volatility assumptions used in the model were based on volatility of the Company's stock price for the thirty-month period immediately preceding the granting of the options. The Company issued stock options in August 2021 and April 2022. The risk-free interest rate is derived from the U.S. treasury yield.

The following assumptions were used in the Black-Scholes model in estimating the fair market value of the Company's stock option grants:

	August 2021			April 2022
Risk-free interest rate:		2.875	%		2.25	%
Expected life of the options:		4 years			4 years
Expected share price volatility:		32	%		29	%
Expected dividends:		zero			zero
These assumptions resulted in estimated fair-market value per stock option:	$	3.42		$	2.52

The ultimate value of the options will depend on the future price of the Company's common stock, which cannot be forecast with reasonable accuracy. A summary of changes in the stock options outstanding during the year ended May 31, 2022 is presented below.

			Weighted-
	Number of		Average
	Options		Exercise Price
Options outstanding and exercisable at May 31, 2021:		267,750	$	11.60
Options granted:		66,750	$	10.69
Less: Options expired:		51,500		—
Options outstanding and exercisable at May 31, 2022:		283,000	$	11.43
Closing value per share on NASDAQ at May 31, 2022:			$	9.30

-13-

Capital Resources, Line of Credit and Long-Term Debt

The Company's primary liquidity is dependent upon its working capital needs. These are primarily inventory, accounts receivable, costs and estimated earnings in excess of billings, accounts payable, accrued commissions, billings in excess of costs and estimated earnings, and debt service. The Company's primary sources of liquidity have been operations and bank financing.

Capital expenditures for the year ended May 31, 2022 were $1,392,000 compared to $1,622,000 in the prior year. Current year capital expenditures included new manufacturing machinery, testing equipment, paint booths system, upgrades to technology equipment and assembly / test facility improvements. The Company has commitments to make capital expenditures of approximately $1,600,000 as of May 31, 2022. These capital expenditures will be primarily for new manufacturing and testing equipment.

The Company has a $10,000,000 demand line of credit from a bank, with interest payable at the Company's option of 30, 60 or 90 day LIBOR rate plus 2.25%. There is no outstanding balance at May 31, 2022 or May 31, 2021. The outstanding balance on the line of credit fluctuates as the Company's various long-term projects progress. The line is secured by a negative pledge of the Company's real and personal property. This line of credit is subject to the usual terms and conditions applied by the bank and is subject to renewal annually.

The bank is not committed to make loans under this line of credit and no commitment fee is charged.

Inventory and Maintenance Inventory

	May 31, 2022				May 31, 2021				Increase /(Decrease)
Raw materials	$	488,000			$	503,000			$	(15,000	)	-3	%
Work-in-process		5,166,000				5,076,000				90,000		2	%
Finished goods		200,000				256,000				(56,000	)	-22	%
Inventory		5,854,000	84	%		5,835,000	78	%		19,000		0	%
Maintenance and other inventory		1,107,000	16	%		1,613,000	22	%		(506,000	)	-31	%
Total	$	6,961,000	100	%	$	7,448,000	100	%	$	(487,000	)	-7	%

Inventory turnover		3.1				2.1

Inventory, at $5,854,000 as of May 31, 2022, is only slightly higher than at the prior year-end. Of this, approximately 88% is work in process, 4% is finished goods, and 8% is raw materials. All of the current inventory is expected to be consumed or sold within twelve months. The level of inventory will fluctuate from time to time due to the stage of completion of the non-project sales orders in progress at the time.

The Company continues to rework slow-moving inventory, where applicable, to convert it to product to be used on customer orders. During fiscal 2021, the Company began a thorough review of the inventory to identify and dispose of items that had not been used for several years and were unlikely to be used in the foreseeable future. The Company disposed of approximately $772,000 and $1,101,000 of obsolete inventory during the years ended May 31, 2022 and 2021, respectively.

Accounts Receivable, Costs and Estimated Earnings in Excess of Billings (“CIEB”) and Billings in Excess of Costs and Estimated Earnings (“BIEC”)

	May 31, 2022		May 31, 2021		Increase /(Decrease)
Accounts and other receivables	$	4,467,000	$	4,121,000	$	346,000		8	%
Less: Other receivable		—		741,000		(741,000	)	-100	%
Accounts receivable		4,467,000		3,380,000		1,087,000		32	%
CIEB		3,336,000		1,500,000		1,836,000		122	%
Less: BIEC		1,123,000		1,362,000		(239,000	)	-18	%
Net	$	6,680,000	$	3,518,000	$	3,162,000		90	%

Number of an average day’s sales outstanding in accounts receivable (DSO)		42		42

-14-

The Company combines the totals of accounts receivable, the asset CIEB, and the liability BIEC, to determine how much cash the Company will eventually realize from revenue recorded to date. As the accounts receivable figure rises in relation to the other two figures, the Company can anticipate increased cash receipts within the ensuing 30-60 days.

Accounts receivable of $4,467,000 as of May 31, 2022 includes approximately $190,000 of amounts retained by customers on long-term construction projects. The Company expects to collect all of these amounts, including the retained amounts, during the next twelve months. The number of an average day's sales outstanding in accounts receivable (DSO) was 42 days at May 31, 2022 and May 31, 2021. The Company expects to collect the net accounts receivable balance, including the retainage, during the next twelve months.

Other receivable is an amount of ERC claimed by the Company for the second calendar quarter of 2021 and was received in the third calendar quarter of 2021.

The status of the projects in-progress at the end of the current and prior fiscal years have changed in the factors affecting the year-end balances in the asset CIEB, and the liability BIEC:

	2022			2021
Number of projects in progress at year-end		19			14
Aggregate percent complete at year-end		47	%		32	%
Average total value of projects in progress at year-end	$	795,000		$	963,000
Percentage of total value invoiced to customer		35	%		30	%

There are 5 more projects in-process at the end of the current fiscal year as compared with the prior year end and the average value of those projects has decreased by 17% between those two dates.

As noted above, CIEB represents revenues recognized in excess of amounts billed. Whenever possible, the Company negotiates a provision in sales contracts to allow the Company to bill, and collect from the customer, payments in advance of shipments. Unfortunately, provisions such as this are often not possible. The $3,336,000 balance in this account at May 31, 2022 is a 122% increase from the prior year-end. This increase reflects the higher aggregate level of the percentage of completion of these Projects as of the current year end as compared with the Projects in process at the prior year end. Generally, if progress billings are permitted under the terms of a project sales agreement, then the more complete the project is, the more progress billings will be permitted. The Company expects to bill the entire amount during the next twelve months. 58% of the CIEB balance as of the end of the last fiscal quarter, February 28, 2022, was billed to those customers in the current fiscal quarter ended May 31, 2022. The remainder will be billed as the projects progress, in accordance with the terms specified in the various contracts.

The year-end balances in the CIEB account are comprised of the following components:

	May 31, 2022		May 31, 2021
Costs	$	3,250,000	$	2,362,000
Estimated earnings		2,642,000		410,000
Less: Billings to customers		2,556,000		1,272,000
CIEB	$	3,336,000	$	1,500,000
Number of projects in progress		11		9

As noted above, BIEC represents billings to customers in excess of revenues recognized. The $1,123,000 balance in this account at May 31, 2022 is in comparison to a $1,362,000 balance at the end of the prior year. The balance in this account fluctuates in the same manner and for the same reasons as the account "costs and estimated earnings in excess of billings," discussed above. Final delivery of product under these contracts is expected to occur during the next twelve months.

-15-

The year-end balances in this account are comprised of the following components:

	May 31, 2022		May 31, 2021
Billings to customers	$	2,711,000	$	2,741,000
Less: Costs		1,019,000		1,011,000
Less: Estimated earnings		569,000		368,000
BIEC	$	1,123,000	$	1,362,000
Number of projects in progress		8		5

Accounts payable, at $1,427,000 as of May 31, 2022, is 20% less than the prior year-end. This decrease is normal fluctuation of this account and is not considered to be unusual. The Company expects the current accounts payable amount to be paid during the next twelve months.

Commission expense on applicable sales orders is recognized at the time revenue is recognized. The commission is paid following receipt of payment from the customers. Accrued commissions as of May 31, 2022 are $85,000. This is 68% less than the $269,000 accrued at the prior year-end. This decrease is generally due to the decrease in the level of commissionable sales, discussed above. The Company expects the current accrued amount to be paid during the next twelve months.

Other accrued expenses of $3,329,000 increased 94% from the prior year level of $1,715,000. This increase is due to increases in customer prepayments on projects not yet started along with an increase in accrued incentive compensation resulting from increased earnings and sales order bookings.

Management believes that the Company's cash on hand, cash flows from operations, and borrowing capacity under the bank line of credit will be sufficient to fund ongoing operations and capital improvements for the next twelve months.

-16-

Item 7A. Quantitative and Qualitative Disclosures About Market Risk.

Smaller reporting companies are not required to provide the information required by this item.

Item 8. Financial Statements and Supplementary Data.

The financial statements and supplementary data required pursuant to this Item 8 are included in this Form 10-K as a separate section commencing on page 25 and are incorporated herein by reference.

Item 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure.

There have been no disagreements between the Company and its accountants as to matters which require disclosure.

Item 9A. Controls and Procedures.

(a) Evaluation of disclosure controls and procedures.

The Company's principal executive officer and principal financial officer have evaluated the Company's disclosure controls and procedures as of May 31, 2022 and have concluded that, as of the evaluation date, the disclosure controls and procedures were effective to ensure that information required to be disclosed in the reports that the Company files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the Commission's rules and forms and that information required to be disclosed in the reports the Company files or submits under the Exchange Act is accumulated and communicated to our management, including our chief executive officer and chief financial officer, to allow timely decisions regarding required disclosure.

(b) Management's report on internal control over financial reporting.

The Company's management, with the participation of the Company's principal executive officer and principal financial officer, is responsible for establishing and maintaining adequate internal control over financial reporting. The Company's management has assessed the effectiveness of the Company's internal control over financial reporting as of May 31, 2022. In making this assessment, management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control -- Integrated Framework, updated in 2013. Based on this assessment management has concluded that, as of May 31, 2022, the Company's internal control over financial reporting is effective based on those criteria.

There have been no changes in the Company's internal controls over financial reporting that occurred during the fiscal year ended May 31, 2022 that have materially affected, or are reasonably likely to materially affect, the Company's control over financial reporting.

Item 9B. Other Information.

None.

PART III

The information required by Items 10, 11, 12, 13 and 14 of this part will be presented in the Company's Proxy Statement to be issued in connection with the Annual Meeting of Shareholders to be held on October 21, 2022, which information is hereby incorporated by reference into this Annual Report. The proxy materials, including the Proxy Statement and form of proxy, will be filed within 120 days after the Company's fiscal year end.

-17-

PART IV

Item 15. Exhibits and Financial Statement Schedules.

DOCUMENTS FILED AS PART OF THIS REPORT:
	Index to Financial Statements:
		(i)		Report of Independent Registered Public Accounting Firm (PCAOB ID: 130)
		(ii)		Consolidated Balance Sheets as of May 31, 2022 and 2021
		(iii)		Consolidated Statements of Income for the years ended May 31, 2022 and 2021
		(iv)		Consolidated Statements of Stockholders' Equity for the years ended May 31, 2022 and 2021
		(v)		Consolidated Statements of Cash Flows for the years ended May 31, 2022 and 2021
		(vi)		Notes to Consolidated Financial Statements - May 31, 2022 and 2021
EXHIBITS:
	3		Articles of incorporation and by-laws
			(i)		Restated Certificate of Incorporation incorporated by reference to Exhibit (3)(i) of Annual Report on Form 10-K, dated August 24, 1983.
			(ii)		Amendment to Certificate of Incorporation incorporated by reference to Exhibit (3)(iv) to Form 8 [Amendment to Application or Report], dated September 24, 1993.
			(iii)		Amendment to Certificate of Incorporation eliminating and re-designating the Series A Junior Preferred Stock and creating 5,000 Series 2008 Junior Participating Preferred Stock, at $.05 par value, as filed by the Secretary of State of the State of New York on September 16, 2008, and incorporated by reference to Exhibit (3)(i) of Form 8-K, dated as of September 15, 2008 and filed September 18, 2008.
			(iv)		Certificate of Change incorporated by reference to Exhibit (3)(i) to Quarterly Report on Form 10-QSB for the period ending November 30, 2002.
			(v)		By-laws and Proxy Review Guidelines incorporated by reference to Exhibit (3) to Quarterly Report on Form 10-Q for the period ending February 28, 2015, filed April 14, 2015.
	4		Instruments defining rights of security holders, including indentures
			(i)		Rights Agreement by and between registrant and Computershare Trust Company, N.A., dated as of September 25, 2018 and letter to shareholders (including Summary of Rights), dated October 5, 2018, attached as Exhibits 4 and 20, respectively, to Registration Statement on Form 8-A 12G, filed with the Securities and Exchange Commission on October 5, 2018.
			(ii)		Description of registrant’s securities incorporated by reference to Exhibit 4(vi) to Annual Report on Form 10-K for the fiscal year ended May 31, 2019, filed August 2, 2019.

-18-

10	Material Contracts
	(i)	2005 Taylor Devices, Inc. Stock Option Plan attached as Appendix B to Definitive Proxy Statement, filed with the Securities and Exchange Commission on September 27, 2005.
	(ii)	2008 Taylor Devices, Inc. Stock Option Plan attached as Appendix C to Definitive Proxy Statement, filed with the Securities and Exchange Commission on September 26, 2008.
	(iii)	2012 Taylor Devices, Inc. Stock Option Plan attached as Appendix C to Definitive Proxy Statement, filed with the Securities and Exchange Commission on September 21, 2012.
	(iv)	2015 Taylor Devices, Inc. Stock Option Plan attached as Appendix B to Definitive Proxy Statement, filed with the Securities and Exchange Commission on April 8, 2016.
	(v)	2018 Taylor Devices, Inc. Stock Option Plan attached as Appendix B to Definitive Proxy Statement, filed with the Securities and Exchange Commission on September 27, 2018.
	(vi)	The 2004 Taylor Devices, Inc. Employee Stock Purchase Plan, incorporated by reference to Exhibit 4.1 to Registration Statement on Form S-8, File No. 333-114085, filed with the Securities and Exchange Commission on March 31, 2004.
	(vii)	Post-Effective Amendment No. 1 to Registration Statement on Form S-8, File No. 333-114085, for the 2004 Taylor Devices, Inc. Employee Stock Purchase Plan, filed with the Securities and Exchange Commission on August 24, 2006.
	(viii)	Form of Indemnification Agreement between registrant and directors and executive officers, attached as Appendix A to Definitive Proxy Statement, filed with the Securities and Exchange Commission on September 27, 2007.
	(ix)	Management Bonus Policy dated as of March 4, 2011 between the Registrant and executive officers, incorporated by reference to Exhibit 10(i) to Quarterly Report on Form 10-Q for the period ending February 28, 2011.
	(x)	Negative Pledge Agreement dated August 30, 2017 by the Registrant in favor of M&T Bank, incorporated by reference to Exhibit 10(xiv) to Quarterly Report on Form 10-Q for the period ending August 31, 2017..
	(xi)	Employment Agreement dated as of June 14, 2018 between the Registrant and Alan R. Klembczyk, incorporated by reference to Exhibit 10(i) to Current Report on Form 8-K filed June 19, 2018.
	(xii)	Employment Agreement dated as of June 14, 2018 between the Registrant and Mark V. McDonough, incorporated by reference to Exhibit 10(ii) to Current Report on Form 8-K filed June 19, 2018.
	(xiii)	Employment Agreement dated as of August 9, 2021 between the Registrant and Timothy J. Sopko, incorporated by reference to Exhibit 10 to Current Report on Form 8-K filed August 13, 2021.

-19-

11	Statement regarding computation of per share earnings

	REG. 228.601(A)(11) Statement regarding computation of per share earnings

	Weighted average of common stock/equivalents outstanding - fiscal year ended May 31, 2022

			Weighted average common stock outstanding			3,497,345
			Common shares issuable under stock option plans using treasury stock method			2,208
			Weighted average common stock outstanding assuming dilution			3,499,553

			Net income fiscal year ended May 31, 2022	(1)	$ 2,239,423
			Weighted average common stock	(2)	3,497,345
			Basic income per common share (1) divided by (2)		$ 0.64

			Net income fiscal year ended May 31, 2022	(3)	$ 2,239,423
			Weighted average common stock outstanding assuming dilution	(4)	3,499,553
			Diluted income per common share (3) divided by (4)		$ 0.64

	Weighted average of common stock/equivalents outstanding - fiscal year ended May 31, 2021

			Weighted average common stock outstanding			3,490,213
			Common shares issuable under stock option plans using treasury stock method			1,674
			Weighted average common stock outstanding assuming dilution			3,491,887

			Net income fiscal year ended May 31, 2021	(1)	$ 1,062,895
			Weighted average common stock	(2)	3,490,213
			Basic income per common share (1) divided by (2)		$ 0.30

			Net income fiscal year ended May 31, 2021	(3)	$ 1,062,895
			Weighted average common stock outstanding assuming dilution	(4)	3,491,887
			Diluted income per common share (3) divided by (4)		$ 0.30

13	The Annual Report to Security Holders for the fiscal year ended May 31, 2022, attached to this Annual Report on Form 10-K.

21	Subsidiaries of the registrant
	Tayco Realty Corporation is a New York corporation organized on September 8, 1977, owned by the Company.
23	The Consent of Independent Registered Public Accounting Firm precedes the Consolidated Financial Statements.
31	Officer Certifications
	(i)	Rule 13a-14(a) Certification of Chief Executive Officer.
	(ii)	Rule 13a-14(a) Certification of Chief Financial Officer.

-20-

32	Officer Certifications
	(i)	Section 1350 Certification of Chief Executive Officer.
	(ii)	Section 1350 Certification of Chief Financial Officer.
101	Interactive data files pursuant to Rule 405 of Regulation S-T: (i) Consolidated Balance Sheets, (ii) Consolidated Statements of Income, (iii) Consolidated Statements of Stockholders’ Equity, (iv) Consolidated Statements of Cash Flows, and (v) Notes to Consolidated Financial Statements.
	101.SCH		XBRL Taxonomy Extension Schema Document
	101.CAL		XBRL Taxonomy Extension Calculation Linkbase Document
	101.DEF		XBRL Taxonomy Extension Definition Linkbase Document
	101.LAB		XBRL Taxonomy Extension Label Linkbase Document
	101.PRE		XBRL Taxonomy Extension Presentation Linkbase Document

-21-

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

TAYLOR DEVICES, INC.
(Registrant)

By:	/s/Timothy J. Sopko	Date:	August 19, 2022
	Timothy J. Sopko
	Chief Executive Officer
	(Principal Executive Officer)

and

By:	/s/Mark V. McDonough	Date:	August 19, 2022
	Mark V. McDonough
	Chief Financial Officer

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

By:	/s/John Burgess	By:	/s/Robert M. Carey
	John Burgess, Director		Robert M. Carey, Director
	August 19, 2022		August 19, 2022

By:	/s/F. Eric Armenat	By:	/s/Alan R. Klembczyk
	F. Eric Armenat, Director		Alan R. Klembczyk, President and Director
	August 19, 2022		August 19, 2022

-22-

[Lumsden & McCormick, LLP Letterhead]

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To The Board of Directors of

Taylor Devices, Inc.

Gentlemen:

We hereby consent to the incorporation by reference in this Annual Report on Form 10-K (Commission File Number 0-3498) of Taylor Devices, Inc. of our report dated August 19, 2022 and any reference thereto in the Annual Report to Shareholders for the fiscal year ended May 31, 2022.

We also consent to such incorporation by reference in Registration Statement Nos. 333-114085, 333-133340, 333-155284, 333-184809, 333-210660, and 333-232121 of Taylor Devices, Inc. on Form S-8 of our report dated August 19, 2022.

/s/Lumsden & McCormick, LLP

Lumsden & McCormick, LLP

Buffalo, New York

August 19, 2022

-23-

TAYLOR DEVICES, INC. AND SUBSIDIARY

CONSOLIDATED FINANCIAL STATEMENTS

May 31, 2022

-24-

[Lumsden & McCormick, LLP Letterhead]

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Board of Directors and Stockholders

Taylor Devices, Inc.

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheets of Taylor Devices, Inc. and Subsidiary (the Company) as of May 31, 2022 and 2021, and the related consolidated statements of income, stockholders' equity, and cash flows for the years then ended, and the related notes to the consolidated financial statements (collectively referred to as the consolidated financial statements). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial condition of the Company as of May 31, 2022 and 2021, and the results of its operations and its cash flows for the years then ended in accordance with accounting principles generally accepted in the United States of America.

Basis for Opinion

These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s consolidated financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matters

The critical audit matters communicated below are matters arising from the current period audit of the consolidated financial statements that were communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.

-25-

Cost Estimates for Long-Term Contracts and Related Revenue Recognition

Description of the Matter

As more fully described in Note 1 to the consolidated financial statements, the Company recognizes revenue over time for long-term contracts as goods are produced. The Company uses costs incurred as the method to determine progress, and revenue is recognized based on costs incurred to date plus an estimate of margin at completion. The process of estimating margin at completion involves estimating the costs to complete production of goods and comparing those costs to the estimated final revenue amount. Long-term contracts are inherently uncertain in that revenue is fixed while the estimates of costs required to complete these contracts are subject to significant variability. Due to the technical performance requirements in many of these contracts, changes to cost estimates could occur, resulting in higher or lower margins when the contracts are completed.

Given the inherent uncertainty and significant judgments necessary to estimate future costs at completion, auditing these estimates involved a focused audit effort and a high degree of auditor judgment.

How We Addressed the Matter in Our Audit

Our auditing procedures related to the cost estimates for long-term contracts and related revenue recognition included the following, among others:

We evaluated the appropriateness and consistency of management’s methods used to develop its estimates.
We evaluated the reasonableness of judgments made and significant assumptions used by management relating to key estimates.
We selected a sample of executed contracts to understand the contract, perform an independent assessment of the appropriate timing of revenue recognition, and test the mathematical accuracy of revenue recognized based on costs incurred to date relative to total estimated costs at completion.
We performed inquiries of the Company’s project managers and others directly involved with the contracts to evaluate project status and project challenges which may affect total estimated costs to complete. We also observed the project work site when key estimates related to tangible or physical progress of the project.
We tested the accuracy and completeness of the data used to develop key estimates, including material, labor, overhead, and sub-contractor costs.
We performed retrospective reviews of prior year long-term contracts, comparing actual performance to estimated performance and the related financial statement impact, when evaluating the thoroughness and precision of management’s estimation process in previous years.

Valuation of Inventory

Description of the Matter

As of May 31, 2022, the Company’s inventory balance was approximately $5.9 million, net of a $100,000 allowance for obsolescence, its maintenance and other inventory balance was approximately $1.1 million, net of an approximate $1.2 million allowance for obsolescence. As discussed in Note 5, maintenance and other inventory represents certain items that are estimated to have a product life-cycle in excess of twelve months the Company is required to maintain for service of products sold and items that are generally subject to spontaneous ordering. The Company evaluates its inventory for obsolescence on an ongoing basis by considering historical usage as well as requirements for future orders.

Given the inherent uncertainty and significant judgments necessary to estimate potential inventory obsolescence, auditing management’s estimates involved a high degree of auditor judgment.

-26-

How We Addressed the Matter in Our Audit

Our auditing procedures related to valuation of inventory included the following, among others:

We evaluated the appropriateness and consistency of management’s methods used to develop its estimates.
We evaluated the reasonableness of judgments made and significant assumptions used by management relating to key estimates.
We inquired of management relative to write-offs of inventory during the year.
We tested the completeness and accuracy of management’s schedule of inventory.
We developed an independent expectation of the obsolescence reserve based on our knowledge of the Company’s inventory, including analysis of slow-moving items and historical usage and compared it to actual.
We examined management’s lower of cost or net realizable value analysis and performed procedures to test its completeness and accuracy.
We selected a sample of material purchases made during the year to ensure they were included in inventory at the proper value.
During our physical inventory observation, we toured the Company’s warehouses and examined inventory on hand for any indications of obsolescence.

/s/Lumsden & McCormick, LLP

Lumsden & McCormick, LLP

We have served as the Company’s auditor since 1998.

Buffalo, New York

August 19, 2022

-27-

TAYLOR DEVICES, INC. AND SUBSIDIARY

Consolidated Balance Sheets

May 31,	2022			2021

Assets
Current assets:
Cash and cash equivalents	$	22,517,038		$	20,581,604
Short-term investments		1,097,450			1,097,012
Accounts and other receivables, net		4,466,686			4,120,564
Inventory		5,854,935			5,835,596
Prepaid expenses		468,489			522,747
Prepaid income taxes		235,947			454,778
Costs and estimated earnings in excess of billings		3,336,474			1,499,604
Total current assets		37,977,019			34,111,905

Maintenance and other inventory, net		1,107,309			1,612,839
Property and equipment, net		9,854,759			9,816,594
Cash value of life insurance, net		205,359			200,538
Deferred income taxes		74,615			190,115
Total assets	$	49,219,061		$	45,931,991
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable		1,426,830			1,787,325
Accrued commissions		84,907			269,064
Other accrued expenses		3,329,407			1,715,409
Billings in excess of costs and estimated earnings		1,122,763			1,361,985
Total current liabilities		5,963,907			5,133,783


Stockholders' Equity:
Common stock, $.025 par value, authorized 8,000,000 shares, issued 4,056,771 and 4,055,275 shares		101,342			101,305
Paid-in capital		10,227,916			10,010,430
Retained earnings		35,840,898			33,601,475
Stockholders’ equity before treasury stock		46,170,156			43,713,210
Treasury stock – 558,834 shares at cost		(2,915,002	)		(2,915,002	)
Total stockholders' equity		43,255,154			40,798,208
Total liabilities and stockholders’ equity	$	49,219,061		$	45,931,991

See notes to consolidated financial statements.

-28-

TAYLOR DEVICES, INC. AND SUBSIDIARY

Consolidated Statements of Income

For the years ended May 31,	2022		2021


Sales, net	$	30,866,582	$	22,509,641

Cost of goods sold		22,239,070		19,334,950

Gross profit		8,627,512		3,174,691

Selling, general and administrative expenses		6,154,735		5,526,774

Operating income (loss)		2,472,777		(2,352,083	)

Other income
Interest, net		4,543		53,654
Paycheck Protection Program loan forgiveness		—		1,461,500
Employee Retention Credit		53,508		1,510,131
Miscellaneous		25,595		8,693
Total other income		83,646		3,033,978

Income before provision for income taxes		2,556,423		681,895

Provision for income taxes (benefit)		317,000		(381,000	)

Net income	$	2,239,423	$	1,062,895

Basic and diluted earnings per common share	$	0.64	$	0.30

See notes to consolidated financial statements.

-29-

TAYLOR DEVICES, INC. AND SUBSIDIARY

Consolidated Statements of Shareholders’ Equity

For the years ended May 31,	2022			2021

Common Stock
Beginning of period	$	101,305		$	100,943
Issuance of shares for employee stock purchase plan		37			37
Issuance of shares for employee stock option plan		—			325
End of period		101,342			101,305

Paid-in Capital
Beginning of period		10,010,430			9,759,063
Issuance of shares for employee stock purchase plan		16,208			14,954
Issuance of shares for employee stock option plan		—			82,070
Stock options issued for services		201,278			154,343
End of period		10,227,916			10,010,430

Retained Earnings
Beginning of period		33,601,475			32,538,580
Net income		2,239,423			1,062,895
End of period		35,840,898			33,601,475

Treasury Stock
Beginning of period		(2,915,002	)		(2,861,032	)
Issuance of shares for employee stock option plan		—			(53,970	)
End of period		(2,915,002	)		(2,915,002	)

Total stockholders' equity	$	43,255,154		$	40,798,208

See notes to consolidated financial statements.

-30-

TAYLOR DEVICES, INC. AND SUBSIDIARY

Consolidated Statements of Cash Flows

For the years ended May 31,	2022			2021

Operating activities:
Net income	$	2,239,423		$	1,062,895
Adjustments to reconcile net income to net cash flows from operating activities:
Depreciation		1,347,442			1,212,713
Stock options issued for services		201,278			154,343
Bad debt expense		—			134,000
Gain on disposal of property and equipment		(1,530	)		—
Provision for inventory obsolescence		—			1,500,000
Deferred income taxes		115,500			(20,000	)
Paycheck Protection Program loan forgiveness		—			(1,461,500	)
Changes in other current assets and liabilities:
Accounts and other receivables		(346,122	)		1,564,907
Inventory		486,191			2,038,052
Prepaid expenses		54,258			(62,535	)
Prepaid income taxes		218,831			(404,630	)
Costs and estimated earnings in excess of billings		(1,836,870	)		254,969
Accounts payable		(360,495	)		417,150
Accrued commissions		(184,157	)		(36,821	)
Other accrued expenses		1,613,998			51,495
Billings in excess of costs and estimated earnings		(239,222	)		625,119
Net operating activities		3,308,525			7,030,157

Investing activities:
Acquisition of property and equipment		(1,391,577	)		(1,621,817	)
Proceeds from disposal of property and equipment		7,500			—
Increase in short-term investments		(438	)		(25,062	)
Increase in cash value of life insurance		(4,821	)		(4,917	)
Net investing activities		(1,389,336	)		(1,651,796	)

Financing activities:
Proceeds from issuance of common stock		16,245			43,416

Net change in cash and cash equivalents		1,935,434			5,421,777

Cash and cash equivalents - beginning		20,581,604			15,159,827
Cash and cash equivalents - ending	$	22,517,038		$	20,581,604

See notes to consolidated financial statements.

-31-

TAYLOR DEVICES, INC. AND SUBSIDIARY

Notes to Consolidated Financial Statements

1. Summary of Significant Accounting Policies:

Nature of Operations:

Taylor Devices, Inc. (the Company) manufactures and sells a single group of very similar products that have many different applications for customers. These similar products are included in one of eight categories; namely, Seismic Dampers, Fluidicshoks®, Crane and Industrial Buffers, Self-Adjusting Shock Absorbers, Liquid Die Springs, Vibration Dampers, Machined Springs and Custom Actuators for use in various types of machinery, equipment and structures, primarily to customers which are located throughout the United States and several foreign countries. The products are manufactured at the Company's sole operating facility in the United States where all of the Company's long-lived assets reside. Management does not track or otherwise account for sales broken down by these categories.

76% of the Company's 2022 revenue was generated from sales to customers in the United States and 14% was from sales to customers in Asia. Remaining sales were to customers in other countries in North America, Europe, Australia, and South America.

68% of the Company's 2021 revenue was generated from sales to customers in the United States and 20% was from sales to customers in Asia. Remaining sales were to customers in other countries in North America, Europe and South America.

Principles of Consolidation:

The accompanying consolidated financial statements include the accounts of the Company and its wholly owned subsidiary, Tayco Realty Corporation (Realty). All inter-company transactions and balances have been eliminated in consolidation.

Subsequent Events:

The Company has evaluated events and transactions for potential recognition or disclosure in the financial statements through the date the financial statements were issued.

Use of Estimates:

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates.

Cash and Cash Equivalents:

The Company includes all highly liquid investments in money market funds in cash and cash equivalents on the accompanying balance sheets.

Cash and cash equivalents in financial institutions may exceed insured limits at various times during the year and subject the Company to concentrations of credit risk.

Short-term Investments:

At times, the Company invests excess funds in liquid interest earning instruments. Short-term investments at May 31, 2022 and May 31, 2021 include “available for sale” corporate bonds stated at fair value, which approximates cost. The bonds (16) mature on various dates during the period December 2022 to November 2026. Unrealized holding gains and losses would be presented as a separate component of accumulated other comprehensive income, net of deferred income taxes. Realized gains and losses on the sale of investments are determined using the specific identification method.

The bonds are valued using pricing models maximizing the use of observable inputs for similar securities. This includes basing value on yields currently available on comparable securities of issuers with similar credit ratings.

-32-

Accounts and Other Receivables:

Accounts and other receivables are stated at an amount management expects to collect from outstanding balances. Management provides for probable uncollectible accounts through a charge to earnings and a credit to a valuation allowance based on its assessment of the current status of individual accounts. Balances that are still outstanding after management has used reasonable collection efforts are written off through a charge to the valuation allowance and a credit to the receivable.

Inventory:

Inventory is stated at the lower of average cost or net realizable value. Average cost approximates first-in, first-out cost.

Property and Equipment:

Property and equipment is stated at cost net of accumulated depreciation. Depreciation is provided primarily using the straight-line method for financial reporting purposes and accelerated methods for income tax reporting purposes. Maintenance and repairs are charged to operations as incurred; significant improvements are capitalized.

Cash Value of Life Insurance:

Cash value of life insurance is stated at the surrender value of the contracts.

Revenue Recognition:

Revenue is recognized (generally at fixed prices) when, or as, the Company transfers control of promised products or services to a customer in an amount that reflects the consideration to which the Company expects to be entitled in exchange for transferring those products or services.

A performance obligation is a promise in a contract to transfer a distinct good or service to the customer, and is the unit of account. A contract’s transaction price is allocated to each distinct performance obligation and recognized as revenue when, or as, the performance obligation is satisfied. The majority of our contracts have a single performance obligation as the promise to transfer the individual goods or services is not separately identifiable from other promises in the contracts which are, therefore, not distinct. Promised goods or services that are immaterial in the context of the contract are not separately assessed as performance obligations.

Progress payments are typically negotiated for longer term projects. Payments are otherwise due once performance obligations are complete (generally at shipment and transfer of title). For financial statement presentation purposes, the Company nets progress billings against the total costs incurred on uncompleted contracts. The asset, “costs and estimated earnings in excess of billings,” represents revenues recognized in excess of amounts billed. The liability, “billings in excess of costs and estimated earnings,” represents billings in excess of revenues recognized.

-33-

If applicable, the Company recognizes an asset for the incremental material costs of obtaining a contract with a customer if the Company expects the benefit of those costs to be longer than one year and the costs are expected to be recovered. As of May 31, 2022 and 2021, the Company does not have material incremental costs on any open contracts with an original expected duration of greater than one year, and therefore such costs are expensed as incurred. These incremental costs include, but are not limited to, sales commissions incurred to obtain a contract with a customer.

Shipping and Handling Costs:

Shipping and handling costs on incoming inventory items are classified as a component of cost of goods sold, while shipping and handling costs on outgoing shipments to customers are classified as a component of selling, general and administrative expenses. The amounts of these costs classified as a component of selling, general and administrative expenses were $238,536 and $146,878 for the years ended May 31, 2022 and 2021. Shipping and handling activities that occur after the customer has obtained control of the product are considered fulfillment activities, not performance obligations.

Research and Development Costs:

Research and development costs are classified as a component of cost of sales. The amounts of these costs were $1,213,000 and $924,000 for the years ended May 31, 2022 and 2021.

Income Taxes:

The Company's practice is to recognize interest related to income tax matters in interest income / expense and to recognize penalties in selling, general and administrative expenses. The Company did not have any accrued interest or penalties included in its consolidated balance sheets at May 31, 2022 and 2021. The Company recorded no interest expense or penalties in its consolidated statements of income during the years ended May 31, 2022 and 2021.

The Company believes it is no longer subject to examination by federal and state taxing authorities for years prior to May 31, 2019.

Sales Taxes:

Certain jurisdictions impose a sales tax on Company sales to nonexempt customers. The Company collects these taxes from customers and remits the entire amount as required by the applicable law. The Company excludes from revenues and expenses the tax collected and remitted.

Stock-Based Compensation:

The Company measures compensation cost arising from the grant of share-based payments to employees at fair value and recognizes such cost in income over the period during which the employee is required to provide service in exchange for the award. The stock-based compensation expense for the years ended May 31, 2022 and 2021 was $201,278 and $154,343.

-34-

New Accounting Standards:

Any recently issued Accounting Standards Codification (ASC) guidance has either been implemented or are not significant to the Company.

2. Accounts and Other Receivables:

	2022		2021
Customers	$	4,292,300	$	3,184,970
Customers – retention		190,492		200,956
Gross accounts receivable		4,482,792		3,385,926
Less allowance for doubtful accounts		16,106		6,781
Add other receivables		—		741,419
Net accounts receivable	$	4,466,686	$	4,120,564

Retention receivable from customers represents amounts invoiced to customers where payments have been partially withheld pending completion of the project. All amounts are expected to be collected within the next fiscal year.

Other receivable was an amount of Employee Retention Credit claimed by the Company for the second calendar quarter of 2021 and received in the third calendar quarter of 2021.

3. Inventory:

	2022		2021
Raw materials	$	488,393	$	503,344
Work-in-process		5,166,271		5,076,377
Finished goods		300,271		355,875
Gross inventory		5,954,935		5,935,596
Less allowance for obsolescence		100,000		100,000
Net inventory	$	5,854,935	$	5,835,596

4. Costs and Estimated Earnings on Uncompleted Contracts:

	2022		2021
Costs incurred on uncompleted contracts	$	4,268,608	$	3,372,276
Estimated earnings		3,211,392		778,011
Total costs and estimated earnings		7,480,000		4,150,287
Less billings to date		5,266,289		4,012,668
Costs and estimated earnings not billed	$	2,213,711	$	137,619

Amounts are included in the accompanying balance sheets under the following captions:

	2022		2021
Costs and estimated earnings in excess of billings	$	3,336,474	$	1,499,604
Billings in excess of costs and estimated earnings		1,122,763		1,361,985
Costs and estimated earnings not billed	$	2,213,711	$	137,619

-35-

The following summarizes the status of Projects in progress as of May 31, 2022 and 2021:

	2022			2021
Number of Projects in progress		19			14
Aggregate percent complete		47	%		32	%
Aggregate amount remaining	$	7,627,234		$	9,333,701
Percentage of total value invoiced to customer		35	%		30	%

The Company expects to recognize the entire remaining revenue on all open projects during the May 31, 2023 fiscal year.

Revenue recognized during the years ended May 31, 2022 and 2021 for amounts included in billings in excess of costs and estimated earnings as of the beginning of the year amounted to $1,420,000, and $736,866.

5. Maintenance and Other Inventory:

	2022		2021
Maintenance and other inventory	$	2,334,889	$	3,612,000
Less allowance for obsolescence		1,227,580		1,999,161
Maintenance and other inventory, net	$	1,107,309	$	1,612,839

During fiscal 2021, the Company began a thorough review of the facilities including the flow of inventory through the factory and warehouse areas to determine the most efficient utilization of available space. This review continued through fiscal 2022. Inventory purchasing practices and stocking levels were also evaluated and it was determined that a significant portion of the older items would be disposed of while the allowance for potential inventory obsolescence would be increased as more items are identified for disposal. $772,000 and $1,101,000 of inventory was disposed of during the years ended May 31, 2022 and 2021. The provision for potential inventory obsolescence was zero and $1,500,000 for the years ended May 31, 2022 and 2021.

6. Property and Equipment:

	2022		2021
Land	$	195,220	$	195,220
Buildings and improvements		9,821,812		9,584,087
Machinery and equipment		12,824,696		12,366,569
Office furniture and equipment		2,744,400		2,536,688
Autos and trucks		24,818		24,818
Land improvements		483,929		476,429
Gross property and equipment		26,094,875		25,183,811
Less accumulated depreciation		16,240,116		15,367,217
Property and equipment, net	$	9,854,759	$	9,816,594

Depreciation expense was $1,347,442 and $1,212,713 for the years ended May 31, 2022 and 2021.

The Company has commitments to make capital expenditures of approximately $1,600,000 as of May 31, 2022.

-36-

7. Short-Term Borrowings:

The Company has available a $10,000,000 demand line of credit from a bank, with interest payable at the Company's option of 30, 60 or 90 day LIBOR rate plus 2.25%. The line is secured by a negative pledge of the Company's real and personal property. This line of credit is subject to the usual terms and conditions applied by the bank and subject to renewal annually.

There is no amount outstanding under the line of credit at May 31, 2022 or May 31, 2021.

The Company uses a cash management facility under which the bank draws against the available line of credit to cover checks presented for payment on a daily basis. Outstanding checks under this arrangement totaled $193,478 and $366,209 as of May 31, 2022 and 2021. These amounts are included in accounts payable.

8. Other Accrued Expenses:

	2022		2021
Customer deposits	$	1,347,709	$	867,652
Personnel costs		1,587,271		659,623
Other		394,427		188,134
Total other accrued expenses	$	3,329,407	$	1,715,409

9. Sales:

The Company manufactures and sells a single group of very similar products that have many different applications for customers. These similar products are included in one of eight categories; namely, Seismic Dampers, Fluidicshoks®, Crane and Industrial Buffers, Self-Adjusting Shock Absorbers, Liquid Die Springs, Vibration Dampers, Machined Springs and Custom Actuators. Management does not track or otherwise account for sales broken down by these categories. Sales of the Company's products are made to three general groups of customers: industrial, structural and aerospace / defense. A breakdown of sales to these three general groups of customers is as follows:

	2022		2021
Structural	$	16,267,162	$	10,137,468
Aerospace / Defense		12,440,687		10,183,399
Industrial		2,158,733		2,188,774
Sales, net	$	30,866,582	$	22,509,641

Sales to a single customer approximated 15% of net sales for 2022. Sales two customers approximated 21% (11% and 10%, respectively) of net sales for 2021.

10. Income Taxes:

	2022		2021
Current tax provision (benefit):
Federal	$	200,100	$	(361,000	)
State		1,400		—
Total current tax provision		201,500		(361,000	)
Deferred tax provision (benefit):
Federal		115,500		(20,000	)
State		—		—
Total deferred tax provision		115,500		(20,000	)
Total tax provision	$	317,000	$	(381,000	)

-37-

A reconciliation of provision for income taxes at the statutory rate to income tax provision at the Company's effective rate is as follows:

	2022			2021
Computed tax provision at the expected statutory rate	$	536,800		$	143,200
State income tax - net of Federal tax benefit		1,100			—
Tax effect of permanent differences:
Research tax credits		(275,400	)		(218,000	)
Foreign-derived intangible income deduction		(12,200	)		—
PPP loan forgiveness		—			(306,900	)
Other permanent differences		3,100			41,500
Other		63,600			(40,800	)
Total tax provision	$	317,000		$	(381,000	)
Effective income tax rate		12.4	%		(55.9	%)

Significant components of the Company's deferred tax assets and liabilities consist of the following:

	2022			2021
Deferred tax assets:
Allowance for doubtful receivables	$	3,400		$	1,400
Tax inventory adjustment		92,200			22,900
Allowance for obsolete inventory		278,800			440,800
Accrued vacation		84,300			81,400
Accrued commissions		7,000			5,900
Warranty reserve		48,800			23,900
R&D tax credit		84,000			—
Stock options issued for services		277,600			238,500
Total deferred tax assets		876,100			814,800
Deferred tax liabilities:
Excess tax depreciation		(801,485	)		(624,685	)
Net deferred tax assets	$	74,615		$	190,115

Realization of the deferred tax assets is dependent on generating sufficient taxable income at the time temporary differences become deductible. The Company provides a valuation allowance to the extent that deferred tax assets may not be realized. A valuation allowance has not been recorded against the deferred tax assets since management believes it is more likely than not that the deferred tax assets are recoverable. The Company considers future taxable income and potential tax planning strategies in assessing the need for a potential valuation allowance. The amount of the deferred tax assets considered realizable however, could be reduced in the near term if estimates of future taxable income are reduced. The Company will need to generate approximately $4.2 million in taxable income in future years in order to realize the deferred tax assets recorded as of May 31, 2022 of $876,100.

-38-

11. Earnings Per Common Share:

Basic earnings per common share is computed by dividing income available to common stockholders by the weighted-average common shares outstanding for the period. Diluted earnings per common share reflects the weighted-average common shares outstanding and dilutive potential common shares, such as stock options.

A reconciliation of weighted-average common shares outstanding to weighted-average common shares outstanding assuming dilution is as follows:

	2022		2021
Average common shares outstanding		3,497,345		3,490,213
Common shares issuable under stock option plans		2,208		1,674
Average common shares outstanding assuming dilution		3,499,553		3,491,887

12. Related Party Transactions:

The Company had no related party transactions for the years ended May 31, 2022 and 2021.

13. Employee Stock Purchase Plan:

In March 2004, the Company reserved 295,000 shares of common stock for issuance pursuant to a non-qualified employee stock purchase plan. Participation in the employee stock purchase plan is voluntary for all eligible employees of the Company. Purchase of common shares can be made by employee contributions through payroll deductions. At the end of each calendar quarter, the employee contributions will be applied to the purchase of common shares using a share value equal to the mean between the closing bid and ask prices of the stock on that date. These shares are distributed to the employees at the end of each calendar quarter or upon withdrawal from the plan. During the years ended May 31, 2022 and 2021, 1,496 ($9.90 to $11.83 price per share) and 1,470 ($9.20 to $11.40 price per share) common shares, respectively, were issued to employees. As of May 31, 2022, 217,287 shares were reserved for further issue.

14. Stock Option Plans:

In 2018, the Company adopted a stock option plan which permits the Company to grant both incentive stock options and non-qualified stock options. The incentive stock options qualify for preferential treatment under the Internal Revenue Code. Under this plan, 160,000 shares of common stock have been reserved for grant to key employees and directors of the Company and 136,250 shares have been granted as of May 31, 2022. Under the plan, the option price may not be less than the fair market value of the stock at the time the options are granted. Options vest immediately and expire ten years from the date of grant.

Using the Black-Scholes option pricing model, the weighted average estimated fair value of each option granted under the plan was $3.02 during 2022 and $3.27 during 2021. The pricing model uses the assumptions noted in the following table. Expected volatility is based on the historical volatility of the Company's stock. The risk-free interest rate for periods within the contractual life of the option is based on the U.S. Treasury yield curve in effect at the time of the grant. The expected life of options granted is derived from previous history of stock exercises from the grant date and represents the period of time that options granted are expected to be outstanding. The Company uses historical data to estimate option exercise and employee termination assumptions under the valuation model. The Company has never paid dividends on its common stock and does not anticipate doing so in the foreseeable future.

	2022			2021
Risk-free interest rate		2.59	%		2.31	%
Expected life in years		4.0 years			4.0 years
Expected volatility		31	%		33	%
Expected dividend yield		0	%		0	%

-39-

The following is a summary of stock option activity:

	Shares		Weighted Average Exercise Price		Intrinsic Value
Outstanding - May 31, 2020		252,250	$	11.52	$	209,835
Options granted		47,250	$	11.26
Less: options exercised		13,000	$	6.34
Less: options expired		18,750	$	13.31
Outstanding - May 31, 2021		267,750	$	11.60	$	271,426
Options granted		66,750	$	10.69
Less: options expired		51,500		—
Outstanding - May 31, 2022		283,000	$	11.43	$	28,248

We calculated intrinsic value for those options that had an exercise price lower than the market price of our common shares as of the balance sheet dates. The aggregate intrinsic value of outstanding options as of the end of each fiscal year is calculated as the difference between the exercise price of the underlying options and the market price of our common shares for the options that were in-the-money at that date (29,250 at May 31, 2022 and 137,750 at May 31, 2021.) The Company's closing stock price was $9.30 and $11.85 as of May 31, 2022 and 2021. As of May 31, 2022, there are 23,750 options available for future grants under the 2018 stock option plan. No options were exercised in the fiscal year ended May 31, 2022. $28,425 was received from the exercise of share options during the fiscal year ended May 31, 2021.

The following table summarizes information about stock options outstanding at May 31, 2022:

Outstanding and Exercisable
Range of Exercise Prices	Number of Options	Weighted Average Remaining Years of Contractual Life		Weighted Average Exercise Price
$ 7.01-$ 8.00	10,000	0.9	$	7.74
$ 8.01-$ 9.00	19,250	1.5	$	8.64
$ 9.01-$10.00	55,000	9.0	$	9.67
$10.01-$11.00	26,500	7.3	$	10.14
$11.01-$12.00	112,250	7.8	$	11.72
$12.01-$13.00	28,750	3.9	$	12.39
$13.01-$14.00	10,000	4.9	$	13.80
$16.01-$17.00	10,000	3.9	$	16.40
$19.01-$20.00	11,250	4.2	$	19.26
$ 7.01-$20.00	283,000	6.5	$	11.43

The following table summarizes information about stock options outstanding at May 31, 2021:

Outstanding and Exercisable
Range of Exercise Prices	Number of Options	Weighted Average Remaining Years of Contractual Life		Weighted Average Exercise Price
$ 7.01-$ 8.00	15,000	1.6	$	7.74
$ 8.01-$ 9.00	24,250	2.1	$	8.71
$ 9.01-$10.00	30,000	7.6	$	9.85
$10.01-$11.00	32,250	7.2	$	10.17
$11.01-$12.00	91,250	7.4	$	11.71
$12.01-$13.00	33,750	4.3	$	12.36
$13.01-$14.00	15,000	4.2	$	13.80
$16.01-$17.00	15,000	3.6	$	16.40
$19.01-$20.00	11,250	5.2	$	19.26
$ 7.01-$20.00	267,750	5.7	$	11.60

-40-

15. Preferred Stock:

The Company has 2,000,000 authorized but unissued shares of preferred stock which may be issued in series. The shares of each series shall have such rights, preferences, and limitations as shall be fixed by the Board of Directors.

16. Treasury Stock:

Treasury shares are 558,834 at both May 31, 2022 and 2021.

17. Retirement Plan:

The Company maintains a retirement plan for essentially all employees pursuant to Section 401(k) of the Internal Revenue Code. The Company matches a percentage of employee voluntary salary deferrals subject to limitations. The Company may also make discretionary contributions as determined annually by the Company's Board of Directors. The amount expensed under the plan was $313,269 and $288,470 for the years ended May 31, 2022 and 2021.

18. Fair Value of Financial Instruments:

The carrying amounts of cash and cash equivalents, accounts receivable, accounts payable, and accrued liabilities approximate fair value because of the short maturity of these instruments.

The fair values of short-term investments were determined as described in Note 1.

19. Cash Flows Information:

	2022		2021

Interest paid		none		none

Income taxes paid		none	$	43,630

20. Risks and Uncertainties:

On January 31, 2020, the United States Secretary of Health and Human Services (HHS) declared a public health emergency related to the global spread of coronavirus COVID-19, and a pandemic was declared by the World Health Organization in February 2020. Efforts to fight the widespread disease included limiting or closing many businesses and resulted in a severe disruption of operations for many organizations. Financial markets also fluctuated significantly during this time. The extent of the impact of COVID-19 on the Company’s operational and financial performance was significant in fiscal 2021. The use of vaccinations world-wide have apparently slowed spread of the disease, the extent of the impact of COVID-19 on the Company’s operational and financial performance in fiscal 2022 was minimal. The effect on the Company’s operational and financial performance in fiscal 2023 is not expected to be significant however it will depend on further developments, including the duration and spread of the outbreak, impact on customers, employees, and vendors, all of which cannot be predicted.

As a result of the pandemic described above, the Company applied for, and received, financial assistance from the U.S. federal government as part of the CARES Act and the Consolidated Appropriations Act of 2021 (CAA) including: a.) $1,461,500 of income due to the forgiveness of the PPP loan by the SBA (all in fiscal 2021), and b.) $1,563,639 of Employee Retention Credit income ($53,508 in fiscal 2022 and $1,510,131 in fiscal 2021). These amounts are included in Other income on the Consolidated Statements of Income.

21. Legal Proceedings:

There are no legal proceedings except for routine litigation incidental to the business.

EX-31 2 ceo302certification20220531.htm CEO 302 CERTIFICATION

Exhibit 31(i)

CERTIFICATION OF CHIEF EXECUTIVE OFFICER

PURSUANT TO RULE 13a - 14(a) OF THE SECURITIES EXCHANGE ACT OF 1934,

AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Timothy J. Sopko, certify that:

1. I have reviewed this annual report on Form 10-K of Taylor Devices, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 19, 2022

/s/ Timothy J. Sopko

Timothy J. Sopko

Chief Executive Officer

EX-32 3 ceo906certification20220531.htm CEO 906 CERTIFICATION

Exhibit 32(i)

CERTIFICATION OF CHIEF EXECUTIVE OFFICER

PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906

OF THE SARBANES-OXLEY ACT OF 2002

In connect with the quarterly report of Taylor Devices, Inc. ("the Company") on Form 10-K for the fiscal year ended May 31, 2022 to be filed with Securities and Exchange Commission on or about the date hereof (the
"Report"), I, Timothy J. Sopko Chief Executive Officer of the Company, certify, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350, that:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company as of the dates and for the periods covered by the Report.

It is not intended that this statement be deemed to be filed for purposes of the Securities Exchange Act of 1934.

Date: August 19, 2022

By:

/s/ Timothy J. Sopko

Timothy J. Sopko

Chief Executive Officer

EX-31 4 cfo302certification20220531.htm CFO 302 CERTIFICATION

Exhibit 31(ii)

CERTIFICATION OF CHIEF FINANCIAL OFFICER

PURSUANT TO RULE 13a - 14(a) OF THE SECURITIES EXCHANGE ACT OF 1934,

AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Mark V. McDonough, certify that:

1. I have reviewed this annual report on Form 10-K of Taylor Devices, Inc.;

4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: August 19, 2022

/s/ Mark V. McDonough

Mark V. McDonough

Chief Financial Officer

EX-32 5 cfo906certification20220531.htm CFO 906 CERTIFICATION

Exhibit 32(ii)

CERTIFICATION OF CHIEF FINANCIAL OFFICER

PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906

OF THE SARBANES-OXLEY ACT OF 2002

In connect with the quarterly report of Taylor Devices, Inc. (the "Company") on Form 10-K for the fiscal year ended May 31, 2022 to be filed with Securities and Exchange Commission on or about the date hereof (the "Report"), I, Mark V. McDonough, Chief Financial Officer of the Company, certify, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350, that:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

It is not intended that this statement be deemed to be filed for purposes of the Securities Exchange Act of 1934.

Date: August 19, 2022

By:

/s/ Mark V. McDonough

Mark V. McDonough,

Chief Financial Officer

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Number Entity Registrant Name Entity Central Index Key Entity Primary SIC Number Entity Tax Identification Number Entity Incorporation, State or Country Code Entity Address, Address Line One Entity Address, Address Line Two Entity Address, Address Line Three Entity Address, City or Town Entity Address, State or Province Entity Address, Country Entity Address, Postal Zip Code Country Region City Area Code Local Phone Number Extension Written Communications Soliciting Material Pre-commencement Tender Offer Pre-commencement Issuer Tender Offer Title of 12(b) Security No Trading Symbol Flag Trading Symbol Security Exchange Name Title of 12(g) Security Security Reporting Obligation Annual Information Form Audited Annual Financial Statements Entity Well-known Seasoned Issuer Entity Voluntary Filers Entity Current Reporting Status Entity Interactive Data Current Entity Filer Category Entity Small Business Entity Emerging Growth Company Elected Not To Use the Extended Transition Period Document Accounting Standard Other Reporting Standard Item Number Entity Shell Company Entity Public Float Entity Bankruptcy Proceedings, Reporting Current Entity Common Stock, Shares Outstanding Documents Incorporated by Reference [Text Block] Auditor Firm ID Auditor Name Auditor Location Statement of Financial Position [Abstract] Assets Current assets: Cash and cash equivalents Short-term investments Accounts and other receivables, net Inventory Prepaid expenses Prepaid income taxes Costs and estimated earnings in excess of billings Total current assets Maintenance and other inventory, net Property and equipment, net Cash value of life insurance, net Deferred income taxes Total assets Liabilities and Stockholders' Equity Current liabilities: Accounts payable Accrued commissions Other accrued expenses Billings in excess of costs and estimated earnings Total current liabilities Stockholders' Equity: Common stock, $.025 par value, authorized 8,000,000 shares, issued 4,056,771 and 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equipment Proceeds from disposal of property and equipment Increase in short-term investments Increase in cash value of life insurance Net investing activities Financing activities: Proceeds from issuance of common stock Net change in cash and cash equivalents Cash and cash equivalents - beginning Cash and cash equivalents - ending Accounting Policies [Abstract] 1. 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Cover - USD ($)	12 Months Ended
Cover - USD ($)	May 31, 2022	Aug. 19, 2022	Nov. 30, 2021
Cover [Abstract]
Document Type	10-K
Amendment Flag	false
Document Annual Report	true
Document Transition Report	false
Document Period End Date	May 31, 2022
Document Fiscal Period Focus	FY
Document Fiscal Year Focus	2022
Current Fiscal Year End Date	--05-31
Entity File Number	0-3498
Entity Registrant Name	TAYLOR DEVICES INC
Entity Central Index Key	0000096536
Entity Tax Identification Number	16-0797789
Entity Incorporation, State or Country Code	NY
Entity Address, Address Line One	90 Taylor Drive
Entity Address, City or Town	North Tonawanda
Entity Address, State or Province	NY
Entity Address, Postal Zip Code	14120
City Area Code	716
Local Phone Number	694-0800
Title of 12(g) Security	Common Stock ($.025 par value)
Entity Well-known Seasoned Issuer	No
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Public Float			$ 38,294,000
Entity Common Stock, Shares Outstanding		3,502,292
Auditor Firm ID	130
Auditor Name	Lumsden & McCormick, LLP
Auditor Location	Buffalo, New York

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Consolidated Balance Sheets - USD ($)	May 31, 2022	May 31, 2021
Current assets:
Cash and cash equivalents	$ 22,517,038	$ 20,581,604
Short-term investments	1,097,450	1,097,012
Accounts and other receivables, net	4,466,686	4,120,564
Inventory	5,854,935	5,835,596
Prepaid expenses	468,489	522,747
Prepaid income taxes	235,947	454,778
Costs and estimated earnings in excess of billings	3,336,474	1,499,604
Total current assets	37,977,019	34,111,905
Maintenance and other inventory, net	1,107,309	1,612,839
Property and equipment, net	9,854,759	9,816,594
Cash value of life insurance, net	205,359	200,538
Deferred income taxes	74,615	190,115
Total assets	49,219,061	45,931,991
Current liabilities:
Accounts payable	1,426,830	1,787,325
Accrued commissions	84,907	269,064
Other accrued expenses	3,329,407	1,715,409
Billings in excess of costs and estimated earnings	1,122,763	1,361,985
Total current liabilities	5,963,907	5,133,783
Stockholders' Equity:
Common stock, $.025 par value, authorized 8,000,000 shares, issued 4,056,771 and 4,055,275 shares	101,342	101,305
Paid-in capital	10,227,916	10,010,430
Retained earnings	35,840,898	33,601,475
Stockholders’ equity before treasury stock	46,170,156	43,713,210
Treasury stock – 558,834 shares at cost	(2,915,002)	(2,915,002)
Total stockholders' equity	43,255,154	40,798,208
Total liabilities and stockholders’ equity	$ 49,219,061	$ 45,931,991

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Consolidated Balance Sheets (Parenthetical) - $ / shares	May 31, 2022	May 31, 2021
Statement of Financial Position [Abstract]
Common Stock, Par or Stated Value Per Share	$ 0.025	$ 0.025
Common Stock, Shares Authorized	8,000,000	8,000,000
Common Stock, Shares, Issued	4,056,771	4,055,275
Treasury Stock, Shares	558,834	558,834

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Consolidated Statements of Income - USD ($)	12 Months Ended
Consolidated Statements of Income - USD ($)	May 31, 2022	May 31, 2021
Income Statement [Abstract]
Sales, net	$ 30,866,582	$ 22,509,641
Cost of goods sold	22,239,070	19,334,950
Gross profit	8,627,512	3,174,691
Selling, general and administrative expenses	6,154,735	5,526,774
Operating income (loss)	2,472,777	(2,352,083)
Interest, net	4,543	53,654
Paycheck Protection Program loan forgiveness	0	1,461,500
Employee Retention Credit	53,508	1,510,131
Miscellaneous	25,595	8,693
Total other income	83,646	3,033,978
Income before provision for income taxes	2,556,423	681,895
Provision for income taxes (benefit)	317,000	(381,000)
Net income	$ 2,239,423	$ 1,062,895
Basic and diluted earnings per common share	$ 0.64	$ 0.30

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Consolidated Statements of Shareholders Equity - USD ($)	Common Stock [Member]	Additional Paid-in Capital [Member]	Retained Earnings [Member]	Treasury Stock [Member]
Stockholders' Equity Attributable to Parent	$ 100,943	$ 9,759,063	$ 32,538,580
Stockholders' Equity Attributable to Parent, Beginning Balance at May. 31, 2020	100,943	9,759,063	32,538,580
Treasury Stock, Value at May. 31, 2020				$ (2,861,032)
Stock Issued During Period, Value, Employee Stock Purchase Plan	37	14,954
Stock Issued During Period, Value, Employee Benefit Plan	325	82,070		53,970
APIC, Share-Based Payment Arrangement, Option, Increase for Cost Recognition		154,343
Net Income (Loss) Attributable to Parent			1,062,895
Stock Issued During Period, Value, Employee Benefit Plan	(325)	(82,070)		(53,970)
Stockholders' Equity Attributable to Parent, Ending Balance at May. 31, 2021	101,305	10,010,430	33,601,475
Treasury Stock, Value at May. 31, 2021				(2,915,002)
Stockholders' Equity Attributable to Parent	101,305	10,010,430	33,601,475
Stock Issued During Period, Value, Employee Stock Purchase Plan	37	16,208
Stock Issued During Period, Value, Employee Benefit Plan	0	0		0
APIC, Share-Based Payment Arrangement, Option, Increase for Cost Recognition		201,278
Net Income (Loss) Attributable to Parent			2,239,423
Stock Issued During Period, Value, Employee Benefit Plan	0	0		0
Stockholders' Equity Attributable to Parent, Ending Balance at May. 31, 2022	101,342	10,227,916	35,840,898
Treasury Stock, Value at May. 31, 2022				$ (2,915,002)
Stockholders' Equity Attributable to Parent	$ 101,342	$ 10,227,916	$ 35,840,898

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

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Total of all stockholders' equity (deficit) items, net of receivables from officers, directors, owners, and affiliates of the entity which are attributable to the parent. The amount of the economic entity's stockholders' equity attributable to the parent excludes the amount of stockholders' equity which is allocable to that ownership interest in subsidiary equity which is not attributable to the parent (noncontrolling interest, minority interest). This excludes temporary equity and is sometimes called permanent equity.

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1. Summary of Significant Accounting Policies:

XML 16 R6.htm IDEA: XBRL DOCUMENT

Consolidated Statements of Cash Flows - USD ($)	12 Months Ended
Consolidated Statements of Cash Flows - USD ($)	May 31, 2022	May 31, 2021
Operating activities:
Net income	$ 2,239,423	$ 1,062,895
Adjustments to reconcile net income to net cash flows from operating activities:
Depreciation	1,347,442	1,212,713
Stock options issued for services	201,278	154,343
Bad debt expense	0	134,000
Gain on disposal of property and equipment	(1,530)	0
Provision for inventory obsolescence	0	1,500,000
Deferred income taxes	115,500	(20,000)
Paycheck Protection Program loan forgiveness	0	(1,461,500)
Changes in other current assets and liabilities:
Accounts and other receivables	(346,122)	1,564,907
Inventory	486,191	2,038,052
Prepaid expenses	54,258	(62,535)
Prepaid income taxes	218,831	(404,630)
Costs and estimated earnings in excess of billings	(1,836,870)	254,969
Accounts payable	(360,495)	417,150
Accrued commissions	(184,157)	(36,821)
Other accrued expenses	1,613,998	51,495
Billings in excess of costs and estimated earnings	(239,222)	625,119
Net operating activities	3,308,525	7,030,157
Investing activities:
Acquisition of property and equipment	(1,391,577)	(1,621,817)
Proceeds from disposal of property and equipment	7,500	0
Increase in short-term investments	(438)	(25,062)
Increase in cash value of life insurance	(4,821)	(4,917)
Net investing activities	(1,389,336)	(1,651,796)
Financing activities:
Proceeds from issuance of common stock	16,245	43,416
Net change in cash and cash equivalents	1,935,434	5,421,777
Cash and cash equivalents - beginning	20,581,604	15,159,827
Cash and cash equivalents - ending	$ 22,517,038	$ 20,581,604

XML 17 R7.htm IDEA: XBRL DOCUMENT

1. Summary of Significant Accounting Policies:

12 Months Ended

May 31, 2022

Accounting Policies [Abstract]

1. Summary of Significant Accounting Policies:

Nature of Operations:

Principles of Consolidation:

Subsequent Events:

The Company has evaluated events and transactions for potential recognition or disclosure in the financial statements through the date the financial statements were issued.

Use of Estimates:

Cash and Cash Equivalents:

The Company includes all highly liquid investments in money market funds in cash and cash equivalents on the accompanying balance sheets.

Cash and cash equivalents in financial institutions may exceed insured limits at various times during the year and subject the Company to concentrations of credit risk.

Short-term Investments:

Accounts and Other Receivables:

Inventory:

Inventory is stated at the lower of average cost or net realizable value. Average cost approximates first-in, first-out cost.

Property and Equipment:

Cash Value of Life Insurance:

Cash value of life insurance is stated at the surrender value of the contracts.

Revenue Recognition:

Shipping and Handling Costs:

Research and Development Costs:

Research and development costs are classified as a component of cost of sales. The amounts of these costs were $1,213,000 and $924,000 for the years ended May 31, 2022 and 2021.

Income Taxes:

The Company believes it is no longer subject to examination by federal and state taxing authorities for years prior to May 31, 2019.

Sales Taxes:

Stock-Based Compensation:

The Company measures compensation cost arising from the grant of share-based payments to employees at fair value and recognizes such cost in income over the period during which the employee is required to provide service in exchange for the award. The stock-based compensation expense for the years ended May 31, 2022 and 2021 was $201,278 and $154,343.

New Accounting Standards:

Any recently issued Accounting Standards Codification (ASC) guidance has either been implemented or are not significant to the Company.

XML 18 R8.htm IDEA: XBRL DOCUMENT

2. Accounts and Other Receivables:

12 Months Ended

May 31, 2022

Receivables [Abstract]

2. Accounts and Other Receivables:

2. Accounts and Other Receivables:

	2022		2021
Customers	$	4,292,300	$	3,184,970
Customers – retention		190,492		200,956
Gross accounts receivable		4,482,792		3,385,926
Less allowance for doubtful accounts		16,106		6,781
Add other receivables		—		741,419
Net accounts receivable	$	4,466,686	$	4,120,564

Other receivable was an amount of Employee Retention Credit claimed by the Company for the second calendar quarter of 2021 and received in the third calendar quarter of 2021.

XML 19 R9.htm IDEA: XBRL DOCUMENT

3. Inventory:

12 Months Ended

May 31, 2022

Inventory Disclosure [Abstract]

3. Inventory:

3. Inventory:

	2022		2021
Raw materials	$	488,393	$	503,344
Work-in-process		5,166,271		5,076,377
Finished goods		300,271		355,875
Gross inventory		5,954,935		5,935,596
Less allowance for obsolescence		100,000		100,000
Net inventory	$	5,854,935	$	5,835,596

XML 20 R10.htm IDEA: XBRL DOCUMENT

4. Costs and Estimated Earnings on Uncompleted Contracts:

12 Months Ended

May 31, 2022

Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]

4. Costs and Estimated Earnings on Uncompleted Contracts:

	2022		2021
Costs incurred on uncompleted contracts	$	4,268,608	$	3,372,276
Estimated earnings		3,211,392		778,011
Total costs and estimated earnings		7,480,000		4,150,287
Less billings to date		5,266,289		4,012,668
Costs and estimated earnings not billed	$	2,213,711	$	137,619

Amounts are included in the accompanying balance sheets under the following captions:

	2022		2021
Costs and estimated earnings in excess of billings	$	3,336,474	$	1,499,604
Billings in excess of costs and estimated earnings		1,122,763		1,361,985
Costs and estimated earnings not billed	$	2,213,711	$	137,619

The following summarizes the status of Projects in progress as of May 31, 2022 and 2021:

	2022			2021
Number of Projects in progress		19			14
Aggregate percent complete		47	%		32	%
Aggregate amount remaining	$	7,627,234		$	9,333,701
Percentage of total value invoiced to customer		35	%		30	%

The Company expects to recognize the entire remaining revenue on all open projects during the May 31, 2023 fiscal year.

XML 21 R11.htm IDEA: XBRL DOCUMENT

5. Maintenance and Other Inventory:

12 Months Ended

May 31, 2022

Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]

5. Maintenance and Other Inventory:

5. Maintenance and Other Inventory:

	2022		2021
Maintenance and other inventory	$	2,334,889	$	3,612,000
Less allowance for obsolescence		1,227,580		1,999,161
Maintenance and other inventory, net	$	1,107,309	$	1,612,839

During fiscal 2021, the Company began a thorough review of the facilities including the flow of inventory through the factory and warehouse areas to determine the most efficient utilization of available space. This review continued through fiscal 2022. Inventory purchasing practices and stocking levels were also evaluated and it was determined that a significant portion of the older items would be disposed of while the allowance for potential inventory obsolescence would be increased as more items are identified for disposal. $772,000 and $1,101,000 of inventory was disposed of during the years ended May 31, 2022 and 2021. The provision for potential inventory obsolescence was zero and $1,500,000 for the years ended May 31, 2022 and 2021.

XML 22 R12.htm IDEA: XBRL DOCUMENT

6. Property and Equipment:

12 Months Ended

May 31, 2022

Property, Plant and Equipment [Abstract]

6. Property and Equipment:

6. Property and Equipment:

	2022		2021
Land	$	195,220	$	195,220
Buildings and improvements		9,821,812		9,584,087
Machinery and equipment		12,824,696		12,366,569
Office furniture and equipment		2,744,400		2,536,688
Autos and trucks		24,818		24,818
Land improvements		483,929		476,429
Gross property and equipment		26,094,875		25,183,811
Less accumulated depreciation		16,240,116		15,367,217
Property and equipment, net	$	9,854,759	$	9,816,594

Depreciation expense was $1,347,442 and $1,212,713 for the years ended May 31, 2022 and 2021.

The Company has commitments to make capital expenditures of approximately $1,600,000 as of May 31, 2022.

XML 23 R13.htm IDEA: XBRL DOCUMENT

7. Short-Term Borrowings:

12 Months Ended

May 31, 2022

Debt Disclosure [Abstract]

7. Short-Term Borrowings:

7. Short-Term Borrowings:

There is no amount outstanding under the line of credit at May 31, 2022 or May 31, 2021.

XML 24 R14.htm IDEA: XBRL DOCUMENT

8. Other Accrued Expenses:

12 Months Ended

May 31, 2022

Payables and Accruals [Abstract]

8. Other Accrued Expenses:

8. Other Accrued Expenses:

	2022		2021
Customer deposits	$	1,347,709	$	867,652
Personnel costs		1,587,271		659,623
Other		394,427		188,134
Total other accrued expenses	$	3,329,407	$	1,715,409

XML 25 R15.htm IDEA: XBRL DOCUMENT

9. Sales:

12 Months Ended

May 31, 2022

Sales

9. Sales:

9. Sales:

	2022		2021
Structural	$	16,267,162	$	10,137,468
Aerospace / Defense		12,440,687		10,183,399
Industrial		2,158,733		2,188,774
Sales, net	$	30,866,582	$	22,509,641

Sales to a single customer approximated 15% of net sales for 2022. Sales two customers approximated 21% (11% and 10%, respectively) of net sales for 2021.

XML 26 R16.htm IDEA: XBRL DOCUMENT

10. Income Taxes:

12 Months Ended

May 31, 2022

Income Tax Disclosure [Abstract]

10. Income Taxes:

10. Income Taxes:

	2022		2021
Current tax provision (benefit):
Federal	$	200,100	$	(361,000	)
State		1,400		—
Total current tax provision		201,500		(361,000	)
Deferred tax provision (benefit):
Federal		115,500		(20,000	)
State		—		—
Total deferred tax provision		115,500		(20,000	)
Total tax provision	$	317,000	$	(381,000	)

A reconciliation of provision for income taxes at the statutory rate to income tax provision at the Company's effective rate is as follows:

	2022			2021
Computed tax provision at the expected statutory rate	$	536,800		$	143,200
State income tax - net of Federal tax benefit		1,100			—
Tax effect of permanent differences:
Research tax credits		(275,400	)		(218,000	)
Foreign-derived intangible income deduction		(12,200	)		—
PPP loan forgiveness		—			(306,900	)
Other permanent differences		3,100			41,500
Other		63,600			(40,800	)
Total tax provision	$	317,000		$	(381,000	)
Effective income tax rate		12.4	%		(55.9	%)

Significant components of the Company's deferred tax assets and liabilities consist of the following:

	2022			2021
Deferred tax assets:
Allowance for doubtful receivables	$	3,400		$	1,400
Tax inventory adjustment		92,200			22,900
Allowance for obsolete inventory		278,800			440,800
Accrued vacation		84,300			81,400
Accrued commissions		7,000			5,900
Warranty reserve		48,800			23,900
R&D tax credit		84,000			—
Stock options issued for services		277,600			238,500
Total deferred tax assets		876,100			814,800
Deferred tax liabilities:
Excess tax depreciation		(801,485	)		(624,685	)
Net deferred tax assets	$	74,615		$	190,115

Realization of the deferred tax assets is dependent on generating sufficient taxable income at the time temporary differences become deductible. The Company provides a valuation allowance to the extent that deferred tax assets may not be realized. A valuation allowance has not been recorded against the deferred tax assets since management believes it is more likely than not that the deferred tax assets are recoverable. The Company considers future taxable income and potential tax planning strategies in assessing the need for a potential valuation allowance. The amount of the deferred tax assets considered realizable however, could be reduced in the near term if estimates of future taxable income are reduced. The Company will need to generate approximately $4.2 million in taxable income in future years in order to realize the deferred tax assets recorded as of May 31, 2022 of $876,100.

The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.

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11. Earnings Per Common Share:

XML 27 R17.htm IDEA: XBRL DOCUMENT

11. Earnings Per Common Share:

12 Months Ended

May 31, 2022

Earnings Per Share [Abstract]

11. Earnings Per Common Share:

A reconciliation of weighted-average common shares outstanding to weighted-average common shares outstanding assuming dilution is as follows:

	2022		2021
Average common shares outstanding		3,497,345		3,490,213
Common shares issuable under stock option plans		2,208		1,674
Average common shares outstanding assuming dilution		3,499,553		3,491,887

XML 28 R18.htm IDEA: XBRL DOCUMENT

12. Related Party Transactions:

12 Months Ended

May 31, 2022

12. Related Party Transactions:

12. Related Party Transactions:

The Company had no related party transactions for the years ended May 31, 2022 and 2021.

XML 29 R19.htm IDEA: XBRL DOCUMENT

13. Employee Stock Purchase Plan:

12 Months Ended

May 31, 2022

Share-Based Payment Arrangement [Abstract]

13. Employee Stock Purchase Plan:

13. Employee Stock Purchase Plan:

XML 30 R20.htm IDEA: XBRL DOCUMENT

15. Preferred Stock:

12 Months Ended

May 31, 2022

Equity [Abstract]

15. Preferred Stock:

15. Preferred Stock:

XML 31 R21.htm IDEA: XBRL DOCUMENT

16. Treasury Stock:

12 Months Ended

May 31, 2022

Equity [Abstract]

16. Treasury Stock:

16. Treasury Stock:

Treasury shares are 558,834 at both May 31, 2022 and 2021.

XML 32 R22.htm IDEA: XBRL DOCUMENT

17. Retirement Plan:

12 Months Ended

May 31, 2022

Retirement Benefits [Abstract]

17. Retirement Plan:

17. Retirement Plan:

XML 33 R23.htm IDEA: XBRL DOCUMENT

18. Fair Value of Financial Instruments:

12 Months Ended

May 31, 2022

Accounting Policies [Abstract]

18. Fair Value of Financial Instruments:

18. Fair Value of Financial Instruments:

The carrying amounts of cash and cash equivalents, accounts receivable, accounts payable, and accrued liabilities approximate fair value because of the short maturity of these instruments.

The fair values of short-term investments were determined as described in Note 1.

XML 34 R24.htm IDEA: XBRL DOCUMENT

19. Cash Flows Information:

12 Months Ended

May 31, 2022

Supplemental Cash Flow Elements [Abstract]

19. Cash Flows Information:

19. Cash Flows Information:

	2022		2021

Interest paid		none		none

Income taxes paid		none	$	43,630

XML 35 R25.htm IDEA: XBRL DOCUMENT

20. Risks and Uncertainties:

12 Months Ended

May 31, 2022

Risks and Uncertainties [Abstract]

20. Risks and Uncertainties:

20. Risks and Uncertainties:

XML 36 R26.htm IDEA: XBRL DOCUMENT

21. Legal Proceedings:

12 Months Ended

May 31, 2022

Commitments and Contingencies Disclosure [Abstract]

21. Legal Proceedings:

21. Legal Proceedings:

There are no legal proceedings except for routine litigation incidental to the business.

XML 37 R27.htm IDEA: XBRL DOCUMENT

1. Summary of Significant Accounting Policies: (Policies)	12 Months Ended
	May 31, 2022
Accounting Policies [Abstract]
Nature of Operations:	Nature of Operations: Taylor Devices, Inc. (the Company) manufactures and sells a single group of very similar products that have many different applications for customers. These similar products are included in one of eight categories; namely, Seismic Dampers, Fluidicshoks®, Crane and Industrial Buffers, Self-Adjusting Shock Absorbers, Liquid Die Springs, Vibration Dampers, Machined Springs and Custom Actuators for use in various types of machinery, equipment and structures, primarily to customers which are located throughout the United States and several foreign countries. The products are manufactured at the Company's sole operating facility in the United States where all of the Company's long-lived assets reside. Management does not track or otherwise account for sales broken down by these categories. 76% of the Company's 2022 revenue was generated from sales to customers in the United States and 14% was from sales to customers in Asia. Remaining sales were to customers in other countries in North America, Europe, Australia, and South America. 68% of the Company's 2021 revenue was generated from sales to customers in the United States and 20% was from sales to customers in Asia. Remaining sales were to customers in other countries in North America, Europe and South America.
Principles of Consolidation:	Principles of Consolidation: The accompanying consolidated financial statements include the accounts of the Company and its wholly owned subsidiary, Tayco Realty Corporation (Realty). All inter-company transactions and balances have been eliminated in consolidation.
Subsequent Events:	Subsequent Events: The Company has evaluated events and transactions for potential recognition or disclosure in the financial statements through the date the financial statements were issued.
Use of Estimates:	Use of Estimates: The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates.
Cash and Cash Equivalents:	Cash and Cash Equivalents: The Company includes all highly liquid investments in money market funds in cash and cash equivalents on the accompanying balance sheets. Cash and cash equivalents in financial institutions may exceed insured limits at various times during the year and subject the Company to concentrations of credit risk.
Short-term Investments:	Short-term Investments: At times, the Company invests excess funds in liquid interest earning instruments. Short-term investments at May 31, 2022 and May 31, 2021 include “available for sale” corporate bonds stated at fair value, which approximates cost. The bonds (16) mature on various dates during the period December 2022 to November 2026. Unrealized holding gains and losses would be presented as a separate component of accumulated other comprehensive income, net of deferred income taxes. Realized gains and losses on the sale of investments are determined using the specific identification method. The bonds are valued using pricing models maximizing the use of observable inputs for similar securities. This includes basing value on yields currently available on comparable securities of issuers with similar credit ratings.
Accounts and Other Receivables:	Accounts and Other Receivables: Accounts and other receivables are stated at an amount management expects to collect from outstanding balances. Management provides for probable uncollectible accounts through a charge to earnings and a credit to a valuation allowance based on its assessment of the current status of individual accounts. Balances that are still outstanding after management has used reasonable collection efforts are written off through a charge to the valuation allowance and a credit to the receivable.
Inventory:	Inventory: Inventory is stated at the lower of average cost or net realizable value. Average cost approximates first-in, first-out cost.
Property and Equipment:	Property and Equipment: Property and equipment is stated at cost net of accumulated depreciation. Depreciation is provided primarily using the straight-line method for financial reporting purposes and accelerated methods for income tax reporting purposes. Maintenance and repairs are charged to operations as incurred; significant improvements are capitalized.
Cash Value of Life Insurance:	Cash Value of Life Insurance: Cash value of life insurance is stated at the surrender value of the contracts.
Revenue Recognition:	Revenue Recognition: Revenue is recognized (generally at fixed prices) when, or as, the Company transfers control of promised products or services to a customer in an amount that reflects the consideration to which the Company expects to be entitled in exchange for transferring those products or services. A performance obligation is a promise in a contract to transfer a distinct good or service to the customer, and is the unit of account. A contract’s transaction price is allocated to each distinct performance obligation and recognized as revenue when, or as, the performance obligation is satisfied. The majority of our contracts have a single performance obligation as the promise to transfer the individual goods or services is not separately identifiable from other promises in the contracts which are, therefore, not distinct. Promised goods or services that are immaterial in the context of the contract are not separately assessed as performance obligations. For contracts with customers in which the Company satisfies a promise to the customer to provide a product that has no alternative use to the Company and the Company has enforceable rights to payment for progress completed to date inclusive of profit, the Company satisfies the performance obligation and recognizes revenue over time (generally less than one year), using costs incurred to date relative to total estimated costs at completion to measure progress toward satisfying our performance obligations. Incurred cost represents work performed, which corresponds with, and thereby best depicts, the transfer of control to the customer. Contract costs include labor, material and overhead. Adjustments to cost estimates are made periodically, and losses expected to be incurred on contracts in progress are charged to operations in the period such losses are determined. Other sales to customers are recognized upon shipment to the customer based on contract prices and terms. In the year ended May 31, 2022, 60% of revenue was recorded for contracts in which revenue was recognized over time while 40% was recognized at a point in time. In the year ended May 31, 2021, 43% of revenue was recorded for contracts in which revenue was recognized over time while 57% was recognized at a point in time. Progress payments are typically negotiated for longer term projects. Payments are otherwise due once performance obligations are complete (generally at shipment and transfer of title). For financial statement presentation purposes, the Company nets progress billings against the total costs incurred on uncompleted contracts. The asset, “costs and estimated earnings in excess of billings,” represents revenues recognized in excess of amounts billed. The liability, “billings in excess of costs and estimated earnings,” represents billings in excess of revenues recognized. If applicable, the Company recognizes an asset for the incremental material costs of obtaining a contract with a customer if the Company expects the benefit of those costs to be longer than one year and the costs are expected to be recovered. As of May 31, 2022 and 2021, the Company does not have material incremental costs on any open contracts with an original expected duration of greater than one year, and therefore such costs are expensed as incurred. These incremental costs include, but are not limited to, sales commissions incurred to obtain a contract with a customer.
Shipping and Handling Costs:	Shipping and Handling Costs: Shipping and handling costs on incoming inventory items are classified as a component of cost of goods sold, while shipping and handling costs on outgoing shipments to customers are classified as a component of selling, general and administrative expenses. The amounts of these costs classified as a component of selling, general and administrative expenses were $238,536 and $146,878 for the years ended May 31, 2022 and 2021. Shipping and handling activities that occur after the customer has obtained control of the product are considered fulfillment activities, not performance obligations.
Research and Development Costs:	Research and Development Costs: Research and development costs are classified as a component of cost of sales. The amounts of these costs were $1,213,000 and $924,000 for the years ended May 31, 2022 and 2021.
Income Taxes:	Income Taxes: The provision for income taxes provides for the tax effects of transactions reported in the financial statements regardless of when such taxes are payable. Deferred tax assets and liabilities are recognized for the expected future tax consequences of temporary differences between the tax and financial statement basis of assets and liabilities. Deferred taxes are based on tax laws currently enacted with tax rates expected to be in effect when the taxes are actually paid or recovered. The Company's practice is to recognize interest related to income tax matters in interest income / expense and to recognize penalties in selling, general and administrative expenses. The Company did not have any accrued interest or penalties included in its consolidated balance sheets at May 31, 2022 and 2021. The Company recorded no interest expense or penalties in its consolidated statements of income during the years ended May 31, 2022 and 2021. The Company believes it is no longer subject to examination by federal and state taxing authorities for years prior to May 31, 2019.
Sales Taxes:	Sales Taxes: Certain jurisdictions impose a sales tax on Company sales to nonexempt customers. The Company collects these taxes from customers and remits the entire amount as required by the applicable law. The Company excludes from revenues and expenses the tax collected and remitted.
Stock-Based Compensation:	Stock-Based Compensation: The Company measures compensation cost arising from the grant of share-based payments to employees at fair value and recognizes such cost in income over the period during which the employee is required to provide service in exchange for the award. The stock-based compensation expense for the years ended May 31, 2022 and 2021 was $201,278 and $154,343.
New Accounting Standards:	New Accounting Standards: Any recently issued Accounting Standards Codification (ASC) guidance has either been implemented or are not significant to the Company.

XML 38 R28.htm IDEA: XBRL DOCUMENT

2. Accounts and Other Receivables: (Tables)

12 Months Ended

May 31, 2022

Receivables [Abstract]

Accounts receivable table

	2022		2021
Customers	$	4,292,300	$	3,184,970
Customers – retention		190,492		200,956
Gross accounts receivable		4,482,792		3,385,926
Less allowance for doubtful accounts		16,106		6,781
Add other receivables		—		741,419
Net accounts receivable	$	4,466,686	$	4,120,564

XML 39 R29.htm IDEA: XBRL DOCUMENT

3. Inventory: (Tables)

12 Months Ended

May 31, 2022

Inventory Disclosure [Abstract]

Inventory table

	2022		2021
Raw materials	$	488,393	$	503,344
Work-in-process		5,166,271		5,076,377
Finished goods		300,271		355,875
Gross inventory		5,954,935		5,935,596
Less allowance for obsolescence		100,000		100,000
Net inventory	$	5,854,935	$	5,835,596

XML 40 R30.htm IDEA: XBRL DOCUMENT

4. Costs and Estimated Earnings on Uncompleted Contracts: (Tables)

12 Months Ended

May 31, 2022

Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]

Costs and estimated earnings on uncompleted contracts components table

	2022		2021
Costs incurred on uncompleted contracts	$	4,268,608	$	3,372,276
Estimated earnings		3,211,392		778,011
Total costs and estimated earnings		7,480,000		4,150,287
Less billings to date		5,266,289		4,012,668
Costs and estimated earnings not billed	$	2,213,711	$	137,619

Costs and estimated earnings on uncompleted contracts table

	2022		2021
Costs and estimated earnings in excess of billings	$	3,336,474	$	1,499,604
Billings in excess of costs and estimated earnings		1,122,763		1,361,985
Costs and estimated earnings not billed	$	2,213,711	$	137,619

Costs and estimated earnings on uncompleted contracts two table

	2022			2021
Number of Projects in progress		19			14
Aggregate percent complete		47	%		32	%
Aggregate amount remaining	$	7,627,234		$	9,333,701
Percentage of total value invoiced to customer		35	%		30	%

The entire disclosure for long-term contracts or programs.

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
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Reference 3: http://www.xbrl.org/2003/role/disclosureRef
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Reference 4: http://www.xbrl.org/2003/role/disclosureRef
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Reference 6: http://www.xbrl.org/2003/role/disclosureRef
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Reference 7: http://fasb.org/us-gaap/role/ref/legacyRef
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-URI https://asc.fasb.org/subtopic&trid=2197326

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
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Reference 9: http://www.xbrl.org/2003/role/disclosureRef
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Reference 13: http://www.xbrl.org/2003/role/disclosureRef
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Reference 14: http://www.xbrl.org/2003/role/disclosureRef
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Reference 15: http://www.xbrl.org/2003/role/disclosureRef
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Reference 17: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
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-Name Accounting Standards Codification
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Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]

XML 41 R31.htm IDEA: XBRL DOCUMENT

5. Maintenance and Other Inventory: (Tables)

12 Months Ended

May 31, 2022

Maintenance and other inventory table

	2022		2021
Maintenance and other inventory	$	2,334,889	$	3,612,000
Less allowance for obsolescence		1,227,580		1,999,161
Maintenance and other inventory, net	$	1,107,309	$	1,612,839

XML 42 R32.htm IDEA: XBRL DOCUMENT

6. Property and Equipment: (Tables)

12 Months Ended

May 31, 2022

Property, Plant and Equipment [Abstract]

Property and equipment table

	2022		2021
Land	$	195,220	$	195,220
Buildings and improvements		9,821,812		9,584,087
Machinery and equipment		12,824,696		12,366,569
Office furniture and equipment		2,744,400		2,536,688
Autos and trucks		24,818		24,818
Land improvements		483,929		476,429
Gross property and equipment		26,094,875		25,183,811
Less accumulated depreciation		16,240,116		15,367,217
Property and equipment, net	$	9,854,759	$	9,816,594

XML 43 R33.htm IDEA: XBRL DOCUMENT

8. Other Accrued Expenses: (Tables)

12 Months Ended

May 31, 2022

Payables and Accruals [Abstract]

Other accrued expenses table

	2022		2021
Customer deposits	$	1,347,709	$	867,652
Personnel costs		1,587,271		659,623
Other		394,427		188,134
Total other accrued expenses	$	3,329,407	$	1,715,409

XML 44 R34.htm IDEA: XBRL DOCUMENT

9. Sales: (Tables)

12 Months Ended

May 31, 2022

Sales

Sales by major customer type

	2022		2021
Structural	$	16,267,162	$	10,137,468
Aerospace / Defense		12,440,687		10,183,399
Industrial		2,158,733		2,188,774
Sales, net	$	30,866,582	$	22,509,641

XML 45 R35.htm IDEA: XBRL DOCUMENT

10. Income Taxes: (Tables)

12 Months Ended

May 31, 2022

Income Tax Disclosure [Abstract]

Income Taxes Table

	2022		2021
Current tax provision (benefit):
Federal	$	200,100	$	(361,000	)
State		1,400		—
Total current tax provision		201,500		(361,000	)
Deferred tax provision (benefit):
Federal		115,500		(20,000	)
State		—		—
Total deferred tax provision		115,500		(20,000	)
Total tax provision	$	317,000	$	(381,000	)

Reconciliation of income tax statutory rate to effective rate

	2022			2021
Computed tax provision at the expected statutory rate	$	536,800		$	143,200
State income tax - net of Federal tax benefit		1,100			—
Tax effect of permanent differences:
Research tax credits		(275,400	)		(218,000	)
Foreign-derived intangible income deduction		(12,200	)		—
PPP loan forgiveness		—			(306,900	)
Other permanent differences		3,100			41,500
Other		63,600			(40,800	)
Total tax provision	$	317,000		$	(381,000	)
Effective income tax rate		12.4	%		(55.9	%)

Components of Deferred Tax Assets and Liabilities

	2022			2021
Deferred tax assets:
Allowance for doubtful receivables	$	3,400		$	1,400
Tax inventory adjustment		92,200			22,900
Allowance for obsolete inventory		278,800			440,800
Accrued vacation		84,300			81,400
Accrued commissions		7,000			5,900
Warranty reserve		48,800			23,900
R&D tax credit		84,000			—
Stock options issued for services		277,600			238,500
Total deferred tax assets		876,100			814,800
Deferred tax liabilities:
Excess tax depreciation		(801,485	)		(624,685	)
Net deferred tax assets	$	74,615		$	190,115

XML 46 R36.htm IDEA: XBRL DOCUMENT

11. Earnings Per Common Share: (Tables)

12 Months Ended

May 31, 2022

Earnings Per Share [Abstract]

Earnings per common share table

	2022		2021
Average common shares outstanding		3,497,345		3,490,213
Common shares issuable under stock option plans		2,208		1,674
Average common shares outstanding assuming dilution		3,499,553		3,491,887

XML 47 R37.htm IDEA: XBRL DOCUMENT

14. Stock Option Plans: (Tables)

12 Months Ended

May 31, 2022

Share-Based Payment Arrangement, Noncash Expense [Abstract]

Stock option plans table

	2022			2021
Risk-free interest rate		2.59	%		2.31	%
Expected life in years		4.0 years			4.0 years
Expected volatility		31	%		33	%
Expected dividend yield		0	%		0	%

Stock options roll foward

	Shares		Weighted Average Exercise Price		Intrinsic Value
Outstanding - May 31, 2020		252,250	$	11.52	$	209,835
Options granted		47,250	$	11.26
Less: options exercised		13,000	$	6.34
Less: options expired		18,750	$	13.31
Outstanding - May 31, 2021		267,750	$	11.60	$	271,426
Options granted		66,750	$	10.69
Less: options expired		51,500		—
Outstanding - May 31, 2022		283,000	$	11.43	$	28,248

Stock option plans - Stock options outstanding and exercisable

Outstanding and Exercisable
Range of Exercise Prices	Number of Options	Weighted Average Remaining Years of Contractual Life		Weighted Average Exercise Price
$ 7.01-$ 8.00	10,000	0.9	$	7.74
$ 8.01-$ 9.00	19,250	1.5	$	8.64
$ 9.01-$10.00	55,000	9.0	$	9.67
$10.01-$11.00	26,500	7.3	$	10.14
$11.01-$12.00	112,250	7.8	$	11.72
$12.01-$13.00	28,750	3.9	$	12.39
$13.01-$14.00	10,000	4.9	$	13.80
$16.01-$17.00	10,000	3.9	$	16.40
$19.01-$20.00	11,250	4.2	$	19.26
$ 7.01-$20.00	283,000	6.5	$	11.43

Stock option plans - Stock options outstanding and exercisable

Outstanding and Exercisable
Range of Exercise Prices	Number of Options	Weighted Average Remaining Years of Contractual Life		Weighted Average Exercise Price
$ 7.01-$ 8.00	15,000	1.6	$	7.74
$ 8.01-$ 9.00	24,250	2.1	$	8.71
$ 9.01-$10.00	30,000	7.6	$	9.85
$10.01-$11.00	32,250	7.2	$	10.17
$11.01-$12.00	91,250	7.4	$	11.71
$12.01-$13.00	33,750	4.3	$	12.36
$13.01-$14.00	15,000	4.2	$	13.80
$16.01-$17.00	15,000	3.6	$	16.40
$19.01-$20.00	11,250	5.2	$	19.26
$ 7.01-$20.00	267,750	5.7	$	11.60

XML 48 R38.htm IDEA: XBRL DOCUMENT

19. Cash Flows Information: (Tables)

12 Months Ended

May 31, 2022

Supplemental Cash Flow Elements [Abstract]

Supplemental cash flow information

	2022		2021

Interest paid		none		none

Income taxes paid		none	$	43,630

XML 49 R39.htm IDEA: XBRL DOCUMENT

1. Summary of Significant Accounting Policies: (Details Narrative) - USD ($)	12 Months Ended
	May 31, 2022	May 31, 2021
Accounting Policies [Abstract]
Percentage of total sales during a period to domestic customers.	7600.00%	6800.00%
Percentage of total sales during a period to export customers	1400.00%	2000.00%
Percent of revenue recognized with sales contracts containing a single performance obligation	6000.00%	4300.00%
Percent of revenue recognized with sales contracts containing a single performance obligation	4000.00%	5700.00%
Shipping and handling costs	$ 238,536	$ 146,878
Research and development costs	1,213,000	924,000
Share based compensation expense	$ 201,278	$ 154,343

XML 50 R40.htm IDEA: XBRL DOCUMENT

Accounts receivable table (Details) - USD ($)	May 31, 2022	May 31, 2021
Receivables [Abstract]
Customers	$ 4,292,300	$ 3,184,970
Customers – retention	190,492	200,956
Gross accounts receivable	4,482,792	3,385,926
Less allowance for doubtful accounts	16,106	6,781
Add other receivables	0	741,419
Net accounts receivable	$ 4,466,686	$ 4,120,564

XML 51 R41.htm IDEA: XBRL DOCUMENT

Inventory table (Details) - USD ($)	May 31, 2022	May 31, 2021
Inventory Disclosure [Abstract]
Raw materials	$ 488,393	$ 503,344
Work-in-process	5,166,271	5,076,377
Finished goods	300,271	355,875
Gross inventory	5,954,935	5,935,596
Less allowance for obsolescence	100,000	100,000
Net inventory	$ 5,854,935	$ 5,835,596

XML 52 R42.htm IDEA: XBRL DOCUMENT

Costs and estimated earnings on uncompleted contracts components table (Details) - USD ($)	May 31, 2022	May 31, 2021
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]
Costs incurred on uncompleted contracts	$ 4,268,608	$ 3,372,276
Estimated earnings	3,211,392	778,011
Total costs and estimated earnings	7,480,000	4,150,287
Less billings to date	5,266,289	4,012,668
Costs and estimated earnings not billed	$ 2,213,711	$ 137,619

XML 53 R43.htm IDEA: XBRL DOCUMENT

Costs and estimated earnings on uncompleted contracts table (Details) - USD ($)	May 31, 2022	May 31, 2021
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]
Costs and estimated earnings in excess of billings	$ 3,336,474	$ 1,499,604
Billings in excess of costs and estimated earnings	1,122,763	1,361,985
Costs and estimated earnings not billed	$ 2,213,711	$ 137,619

XML 54 R44.htm IDEA: XBRL DOCUMENT

Costs and estimated earnings on uncompleted contracts two table (Details)	May 31, 2022 USD ($)	May 31, 2021 USD ($)
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]
Number of Projects in progress	19	14
Aggregate percent complete	47.00%	32.00%
Aggregate amount remaining	$ 7,627,234	$ 9,333,701
Percentage of total value invoiced to customer	35.00%	30.00%

XML 55 R45.htm IDEA: XBRL DOCUMENT

Maintenance and other inventory table (Details) - USD ($)	May 31, 2022	May 31, 2021
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]
Maintenance and other inventory	$ 2,334,889	$ 3,612,000
Less allowance for obsolescence	1,227,580	1,999,161
Maintenance and other inventory, net	$ 1,107,309	$ 1,612,839

XML 56 R46.htm IDEA: XBRL DOCUMENT

4. Costs and Estimated Earnings on Uncompleted Contracts: (Details Narrative) - USD ($)	12 Months Ended
	May 31, 2022	May 31, 2021
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]
Revenue recognized in current period for projects included in billings in excess of costs and estimated earnings at end of prior year	$ 1,420,000	$ 736,866

XML 57 R47.htm IDEA: XBRL DOCUMENT

5. Maintenance and Other Inventory: (Details Narrative) - USD ($)	12 Months Ended
	May 31, 2022	May 31, 2021
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]
Inventory Write-down	$ 0	$ 1,500,000

XML 58 R48.htm IDEA: XBRL DOCUMENT

Property and equipment table (Details) - USD ($)	May 31, 2022	May 31, 2021
Property, Plant and Equipment [Abstract]
Land	$ 195,220	$ 195,220
Buildings and improvements	9,821,812	9,584,087
Machinery and equipment	12,824,696	12,366,569
Office furniture and equipment	2,744,400	2,536,688
Autos and trucks	24,818	24,818
Land improvements	483,929	476,429
Gross property and equipment	26,094,875	25,183,811
Less accumulated depreciation	16,240,116	15,367,217
Property and equipment, net	$ 9,854,759	$ 9,816,594

XML 59 R49.htm IDEA: XBRL DOCUMENT

6. Property and Equipment: (Details Narrative) - USD ($)	12 Months Ended
	May 31, 2022	May 31, 2021
Property, Plant and Equipment [Abstract]
Depreciation	$ 1,347,442	$ 1,212,713
Commitments for future capital expenditures	$ 1,600,000

XML 60 R50.htm IDEA: XBRL DOCUMENT

7. Short-Term Borrowings: (Details Narrative) - USD ($)	May 31, 2022	May 31, 2021
Debt Disclosure [Abstract]
Line of Credit Facility, Current Borrowing Capacity	$ 10,000,000
Line of Credit Facility, Fair Value of Amount Outstanding	0	$ 0
Accounts Payable, Other, Current	$ 193,478	$ 366,209

XML 61 R51.htm IDEA: XBRL DOCUMENT

Other accrued expenses table (Details) - USD ($)	May 31, 2022	May 31, 2021
Payables and Accruals [Abstract]
Customer deposits	$ 1,347,709	$ 867,652
Personnel costs	1,587,271	659,623
Other	394,427	188,134
Total other accrued expenses	$ 3,329,407	$ 1,715,409

XML 62 R52.htm IDEA: XBRL DOCUMENT

Sales by major customer type (Details) - USD ($)	12 Months Ended
Sales by major customer type (Details) - USD ($)	May 31, 2022	May 31, 2021
Sales, net	$ 30,866,582	$ 22,509,641
Structural Seismic Wind [Member]
Sales, net	16,267,162	10,137,468
Aerospace Defense [Member]
Sales, net	12,440,687	10,183,399
Industrial [Member]
Sales, net	$ 2,158,733	$ 2,188,774

Amount of revenue recognized from goods sold, services rendered, insurance premiums, or other activities that constitute an earning process. Includes, but is not limited to, investment and interest income before deduction of interest expense when recognized as a component of revenue, and sales and trading gain (loss).

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9. Sales: (Details Narrative)	12 Months Ended
9. Sales: (Details Narrative)	May 31, 2022	May 31, 2021
Sales
Percentage of total sales to significant individual customer 1	1500.00%	1100.00%
Percentage of total sales to significant individual customers		2100.00%
Percentage of total sales to significant individual customer 2		1000.00%

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Income Taxes Table (Details) - USD ($)	12 Months Ended
Income Taxes Table (Details) - USD ($)	May 31, 2022	May 31, 2021
Current tax provision (benefit):
Federal	$ 200,100	$ (361,000)
State	1,400	0
Total current tax provision	201,500	(361,000)
Deferred tax provision (benefit):
Federal	115,500	(20,000)
State	0	0
Total deferred tax provision	115,500	(20,000)
Total tax provision	$ 317,000	$ (381,000)