Leases

3 Months Ended

Apr. 30, 2021

The Company has operating leases on real property, equipment, and automobiles that expire at various dates. The Company determines if an arrangement is a lease at inception and assesses classification of the lease at commencement. All of the Company’s leases are classified as operating leases, as a lessee. The Company uses the implicit rate when readily determinable, or the incremental borrowing rate. Our incremental borrowing rate is estimated to approximate the interest rate on a collateralized basis with similar terms and payments using company specific credit spreads. The Company’s lease terms include options to extend or terminate the lease only when it is reasonably certain that we will exercise that option. Lease expense for our operating leases is recognized on a straight-line basis over the lease term.

In accordance with ASC 842, quantitative information regarding our leases is as follows:


	Three-Months Ended
	4/30/2021			4/30/2020
	(in thousands, except lease term and discount rate)
Operating lease cost	$	1,238		$	1,440
Short-term lease cost	96			36
Short-term sublease income	(10)			(10)
Variable lease cost	530			455
Total lease cost	$	1,854		$	1,921

Other operating leases information:
Cash paid for amounts included in the measurement of lease liabilities	$	1,328		$	662
Right-of-use assets obtained in exchange for new lease liabilities	$	165		$	270
Weighted-average remaining lease term (years)	3.8			4.7
Weighted-average discount rate	6.40		%	6.40		%

Minimum future lease payments for operating leases in effect as of April 30, 2021, are as follows:


	Operating Lease
	(in thousands)
Remaining of 2022	$	4,386
2023	5,460
2024	5,319
2025	5,371
2026	1,350
Thereafter	—
Remaining balance of lease payments	$	21,886

Short-term lease liabilities	$	4,715
Long-term lease liabilities	14,573
Total lease liabilities	$	19,288

Difference between undiscounted cash flows and discounted cash flows	$	2,598