Operating Lease

9 Months Ended

Sep. 30, 2019

The Company currently leases office space of approximately 37,829 square feet at one location.

In February 2016, the FASB issued ASU 2016-02, "Leases", which, among other things, requires lessees to recognize most leases on-balance sheet. The Company adopted this ASU on its effective date, January 1, 2019, using a modified retrospective approach without restating prior comparative periods. Upon implementation, the Company recorded a right-of use asset of approximately $2.9 million, which includes the lease liability amount less deferred rent liabilities and lease incentives received, and a lease liability of approximately $3.6 million related to our office lease. As of September 30, 2019, the carrying value of the right-of use asset, which is included in property and equipment, net of deferred rent on the consolidated balance sheets, was approximately $2.6 million. As of September 30, 2019, the carrying value of the lease liability, which is included in accounts payable and accrued expenses on the consolidated balance sheets, was approximately $3.2 million. The adoption of this ASU had no impact on our consolidated statements of income and cash flows and there was no cumulative-effect adjustment required to opening retained earnings.

The following table summarizes the total lease and operating expenses for the three and nine months ended September 30, 2019 and 2018:



	September 30, 2019		September 30, 2018
Three Months Ended	$	239,838	$	238,014
Nine Months Ended	$	731,366	$	732,318

The approximate future minimum lease payments under the operating lease are as follows:



Future Minimum Lease Payments
Three Months Remaining In
2019		2020		2021		2022		2023		Thereafter		Total
$	146,587	$	614,721	$	624,179	$	624,179	$	624,179	$	780,223	$	3,414,068

In addition to the above lease payments, the Company is also responsible for normal operating expenses of the leased property. These operating expenses were approximately $0.4 million in 2018, and are expected to be approximately the same in 2019.