Property and Equipment

Property and Equipment, Net

Property and equipment, which includes assets under capital lease, consists of the following:



	September 30,			December 31,
	2012			2011
	(in thousands)
Computer equipment	$	17,144		$	12,483
Computer software	5,913			5,720
Furniture, fixtures and equipment	1,438			1,330
Scanner appliances	15,894			13,394
Leasehold improvements	1,623			1,418
Total property and equipment	42,012			34,345
Less: accumulated depreciation and amortization	(25,116		)	(20,484		)
Property and equipment, net	$	16,896		$	13,861

Assets held under capital lease included in computer equipment and software at September 30, 2012 and December 31, 2011 totaled approximately $8,053,000. The related accumulated depreciation at September 30, 2012 and December 31, 2011 totaled $4,558,000 and $3,313,000, respectively. The capital lease obligations are secured by the related equipment and software.

Physical scanner appliances and other computer equipment that are or will be subject to subscriptions by customers have a net carrying value of $4,905,000 and $3,436,000 at September 30, 2012 and December 31, 2011, respectively, including assets that have not been placed in service of $1,170,000 and $210,000, respectively. Other fixed assets not placed in service at September 30, 2012 and December 31, 2011, included in computer equipment and leasehold improvements, relate to new information technology systems and tenant improvements of approximately $1,315,000 and $500,000 respectively. Depreciation and amortization expense relating to property and equipment, including capitalized leases, was $1,739,000 and $1,121,000 for the three months ended September 30, 2012 and 2011, respectively, and $5,066,000 and $3,466,000 for the nine months ended September 30, 2012 and 2011, respectively.

- Definition

The entire disclosure for long-lived, physical assets that are used in the normal conduct of business to produce goods and services and not intended for resale. Examples include land, buildings, machinery and equipment, and other types of furniture and equipment including, but not limited to, office equipment, furniture and fixtures, and computer equipment and software. This disclosure may include property plant and equipment accounting policies and methodology, a schedule of property, plant and equipment gross, additions, deletions, transfers and other changes, depreciation, depletion and amortization expense, net, accumulated depreciation, depletion and amortization expense and useful lives, income statement disclosures, assets held for sale and public utility disclosures.

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