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COMMITMENTS | 9 Months Ended
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Oct. 31, 2022
COMMITMENTS |
COMMITMENTS | NOTE 7 – COMMITMENTS Leases The Company’s leases are primarily operating leases that cover office space, expiring on various dates through September 2031, and certain equipment used by the Company in the performance of its construction services contracts. Some of these equipment leases may be embedded in broader agreements with subcontractors or construction equipment suppliers. The Company has no material finance leases. None of the operating leases include significant amounts for incentives, rent holidays or price escalations. Under certain leases, the Company is obligated to pay property taxes, insurance, and maintenance costs. Operating lease right-of-use assets and associated lease liabilities are recorded in the balance sheet at the lease commencement date based on the present value of future minimum lease payments to be made over the expected lease term. As the implicit rate is not determinable in most of the Company’s leases, management uses the Company’s incremental borrowing rate (currently LIBOR plus 1.6%) at the commencement date in determining the present value of future payments. The expected lease term includes any option to extend or to terminate the lease when it is reasonably certain the Company will exercise such option. Operating lease expense amounts are recorded on a straight-line basis over the expected lease terms and were $0.6 million and $1.9 million for the three and nine months ended October 31, 2022, respectively, and were $1.1 million and $3.0 million for the three and nine months ended October 31, 2021, respectively. Operating lease payments for the three and nine months ended October 31, 2022 were $0.6 million and $1.9 million, respectively, and they were $1.1 million and $3.0 million for the three and nine months ended October 31, 2021, respectively. For operating leases as of October 31, 2022, the weighted average lease term is 78 months and the weighted average discount rate is 2.2%. The aggregate amounts of operating leases added during the nine months ended October 31, 2022 and 2021 were $0.9 million and $2.4 million, respectively. Payments for the occupancy by TRC of certain facilities, which were made to the founder and retired chief executive officer of TRC based on an annual rental rate of $0.5 million, and most recently on a month-to-month rental basis, ceased during the three-month period end October 31, 2022 as TRC vacated the facilities in connection with a plant relocation effort that was substantially completed during the period. ​ The following is a schedule of future minimum lease payments for the operating leases that were recognized in the condensed consolidated balance sheet as of October 31, 2022: ​
​ | ​ | ​ | ​
Years Ending January 31,
2023 (remainder) |  | $ | 396
2024 | ​ | ​ | 600
2025 | ​ | ​ | 395
2026 | ​ | ​ | 249
2027 | ​ | ​ | 231
Thereafter | ​ | ​ | 1,028
Total lease payments | ​ | ​ | 2,899
Less interest portion | ​ | ​ | 177
Present value of lease payments | ​ | ​ | 2,722
Less current portion (included in accrued expenses) | ​ | ​ | 796
Non-current portion (included in noncurrent liabilities) | ​ | $ | 1,926
​ The Company also uses equipment and occupies other facilities under short-term rental agreements. Rent expense amounts incurred under short-term rental agreements were $3.5 million and $8.8 million, respectively for the three and nine months ended October 31, 2022. Rent expense amounts incurred under these types of arrangements for the three and nine months ended October 31, 2021 was $1.7 million and $6.6 million, respectively. Performance Bonds and Guarantees In the normal course of business and for certain major projects, the Company may be required to obtain surety or performance bonding, to cause the issuance of letters of credit, or to provide parent company guarantees (or some combination thereof) in order to provide performance assurances to clients on behalf of its contractor subsidiaries. As these subsidiaries are wholly-owned, any actual liability is ordinarily reflected in the financial statement account balances determined pursuant to the Company’s accounting for contracts with customers. When sufficient information about claims on guaranteed or bonded projects would be available and monetary damages or other costs or losses would be determined to be probable, the Company would record such losses. Any such amounts that may be required to be paid in excess of the estimated costs to complete contracts in progress as of October 31, 2022 are not estimable. As of October 31, 2022 and January 31, 2022, the estimated amounts of the Company’s unsatisfied bonded performance obligations, covering all of its subsidiaries, were approximately $0.1 billion and $0.2 billion, respectively. As of October 31, 2022 and January 31, 2022, the outstanding amounts of bonds covering other risks, including warranty obligations related to completed activities, were not material. Not all of our projects require bonding. As of October 31, 2022 and January 31, 2022, the Company had also provided a financial guarantee, subject to certain terms and conditions, on behalf of GPS to an original equipment manufacturer in the amount of $3.6 million in support of business development efforts. A liability was established for the estimated loss related to this guarantee during Fiscal 2022. Warranties The Company generally provides assurance-type warranties for work performed under its construction contracts. The warranties cover defects in equipment, materials, design or workmanship, and most warranty periods typically run from nine to twenty-four months after the completion of construction on a particular project. Because of the nature of the Company’s projects, including project owner inspections of the work both during construction and prior to substantial completion, the Company has not experienced material unexpected warranty costs in the past. Warranty costs are estimated based on experience with the type of work and any known risks relative to each completed project. The accruals of liabilities, which are established to cover estimated future warranty costs, are recorded as the contracted work is performed, and they are included in the amounts of accrued expenses in the condensed consolidated balances sheets. The liability amounts may be periodically adjusted to reflect changes in the estimated size and number of expected warranty claims.

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- Definition The entire disclosure for significant arrangements with third parties, which includes operating lease arrangements and arrangements in which the entity has agreed to expend funds to procure goods or services, or has agreed to commit resources to supply goods or services, and operating lease arrangements. Descriptions may include identification of the specific goods and services, period of time covered, minimum quantities and amounts, and cancellation rights. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 440 -URI http://asc.fasb.org/topic&trid=2144648 + Details
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