Leases

12 Months Ended

Sep. 30, 2024

We enter into operating leases, as the lessee, for office space and vehicles and determine if an arrangement is a lease at inception of the arrangement. Operating lease liabilities and right of use assets are recognized on our consolidated balance sheet for leases with an initial term greater than 12 months based on the present value of the future minimum lease payments over the lease term using our estimated incremental borrowing rate. Operating lease expense associated with minimum lease payments is recognized on a straight-line basis over the lease term. When additional payments are based on usage or vary based on other factors, they are expensed when incurred as variable lease expense. Certain leases include lease and non-lease components, which we account for as a single lease component. Minimum lease payments for leases with an initial term of 12 months or less are not recorded on our consolidated balance sheet. As of September 30, 2024, we had 60 leases that expire at various dates through 2031, with a weighted average remaining lease term of 5.0 years and a weighted average discount rate of 3.9%.

For the fiscal years ended September 30, 2024, 2023 and 2022, the components of operating lease costs were as follows:


	Fiscal Year Ended September 30,
	2024		2023		2022
Fixed rent expense (1)	$	6,636	$	6,272	$	6,144
Variable lease payments	1,158		907		1,001
Total cash portion of rent expense	7,794		7,179		7,145
Non-cash straight line rent expense	(380)		(345)		(352)
Total operating lease costs	$	7,414	$	6,834	$	6,793

(1)Includes expense for leases with an initial term of 12 months or less of $5, $76 and $83 for the fiscal years ended September 30, 2024, 2023 and 2022, respectively.

The following table presents the undiscounted cash flows on an annual fiscal year basis for our operating lease liabilities as of September 30, 2024:


Fiscal Year	Amount
2025	$	6,907
2026	6,293
2027	5,866
2028	4,943
2029	4,111
Thereafter	2,716
Total lease payments (1)	30,836
Less: imputed interest (1)	(2,783)
Present value of operating lease liabilities	28,053
Less: current portion of operating lease liabilities	(5,906)
Operating lease liabilities, net of current portion	$	22,147

(1) Excludes $291 of lease payments for signed leases that have not yet commenced.

As of September 30, 2024, $21,283 of total lease payments and $1,841 of imputed interest are for our principal executive offices, which are leased from an affiliate of ABP Trust pursuant to a lease agreement that expires in 2030.