What changed in this filing

/stocks — the workspaceLOADING

Item 1. Business

2021-05-21 compared with 2020-05-22 · 91 added, 103 removed, 224 unchanged (46% of the section changed)

Our company was founded in 1990 and is a Delaware corporation.

is sometimes referred to in this Annual Report on Form 10-K as “we,” “our,” “us,” “ourselves,” or “ e Plus.”

Our operations are conducted through two business segments.

e Plus inc., sometimes referred to in this Annual Report on Form 10-K as “we,” “our,” “us,” “ourselves,” or “ e Plus.”, was founded in 1990.

We conduct our operations through two business segments.

Our technology segment sells IT hardware products, third-party software and maintenance contracts, our own and third-party advanced professional and managed services, and our proprietary software.

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Both segments sell to commercial entities, state and local governments, government contractors, and educational institutions.

See Note 17, “Segment Reporting” in the consolidated financial statements included elsewhere in this report.

does not engage in any business other than serving as the parent holding company for the following operating companies:

e Plus Technology, inc.;

e Plus Software, LLC;

e Plus Technology Netherlands B.V.;

e Plus Technology Services, inc.;

e Plus Cloud Services, inc.;

SLAIT Consulting, LLC;

IGXGlobal UK Limited;

CloudUno Consulting India Private Limited;

Cloud Uno Pte.

e Plus EMEA, inc.

e Plus Group, inc.;

e Plus Government, inc.;

e Plus Canada Company;

e Plus Capital, inc.;

e Plus Financing Netherlands B.V.;

e Plus Iceland, inc.;

IGX Capital UK, Ltd.

We began using the name e Plus inc.

in 1999 after changing our name from MLC Holdings, Inc.

e Plus Technology, inc.

is the primary entity that conducts our technology sales and services business.

We are a leading solutions provider that delivers actionable outcomes for organizations by using IT and consulting solutions to drive business agility and innovation.

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We also provide consulting, professional and managed services, IT staff augmentation, and complete lifecycle management services including flexible financing and solutions in the areas of security, cloud, networking, data center, collaboration and emerging technologies.

We have been in the business of selling, leasing, financing, and managing IT and other assets for nearly 30 years.

We have been in the business of selling, leasing, financing, and managing IT and other assets for over 30 years.

Our primary focus is to deliver integrated solutions that address our customers’ business needs, leveraging the appropriate technologies, both on-premise and in the cloud.

Our approach is to lead with advisory consulting to understand our customers’ needs, design, deploy and manage solutions aligned to their objectives.

Our approach is to lead with advisory consulting to understand our customers’ needs, and then design, deploy and manage solutions aligned to their objectives.

Underpinning the broader areas of Cloud, Security, Networking, Data Center and Collaboration are specific skills in orchestration and automation, application modernization, DevOps, data management, data visualization, analytics, network modernization, edge compute and other advanced and emerging technologies.

These solutions are comprised of world class leading technologies from partners such as Amazon Web Services, Arista Networks, Check Point, Cisco Systems, Citrix, Commvault, Dell EMC, F5 Networks, Gigamon, HPE, Juniper Networks, Lenovo, Microsoft, NetApp, Nutanix, NVIDIA, Oracle, Palo Alto Networks, Pure Storage, Rubrik, Splunk, and VMware, among many others.

These solutions are comprised of world class leading technologies from partners such as Amazon Web Services, Arista Networks, Check Point, Cisco Systems, Citrix, Commvault, Dell EMC, F5 Networks, Fortinet, Gigamon, HPE, Juniper Networks, Lenovo, Microsoft, NetApp, Nutanix, NVIDIA, Oracle, Palo Alto Networks, Pure Storage, Rubrik, Splunk, Varonis, and VMware, among many others.

We possess top-level engineering certifications with a broad range of leading IT vendors that enable us to offer multi-vendor IT solutions that are optimized for each of our customers’ specific requirements.

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Our go-to-market strategy focuses primarily on diverse end-markets for middle market to large enterprises.

For the year ended March 31, 2020, the percentage of revenue by customer end market within our technology segment includes 21% for the technology industry, 19% for the telecommunications, media and entertainment industry, 16% for state and local government, and educational institutions, 15% for healthcare, and 13% for financial services.

Sales to Verizon represented 15% of our net sales for the year ended March 31, 2020.

For the year ended March 31, 2021, the percentage of revenue by customer end market within our technology segment includes 25% for the telecommunications, media and entertainment industry, 17% for the technology industry, 16% for state and local government, and educational institutions (“SLED”), 13% for healthcare, and 13% for financial services.

Sales to a Verizon Communications Inc.

represented 19% and 15% of our net sales for the years ended March 31, 2021 and 2020, respectively.

Sales to no one customer exceeded 10% of net sales for the year ended March 31, 2019.

Sales to Apple Inc.

represented 12% of our net sales for the year ended March 31, 2018.

Most of our sales were generated within the United States (“US”);

however, we support our customers nationally and internationally including physical locations in the United Kingdom (“UK”), India, and Singapore, which were established by acquisitions in December 2015 and May 2017, respectively.

We sell to customers in the United States (“US”), which accounts for most of our sales, and to customers in select international markets including the United Kingdom (“UK”), the European Union (“EU”), India, and Singapore.

Our technology segment accounted for 96% of our net sales, and 71% of our operating income, while our financing segment accounted for 4% of our net sales, and 29% of our operating income for the year ended March 31, 2021.

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Over the past several years, public, private and hybrid cloud architectures and cloud-enabled frameworks have become a core foundation of modern IT.

Our strategy is to assist our customers in aligning cloud strategy with business objective, creating an enterprise cloud foundation, enabling multi-cloud capabilities, accelerating cloud migrations, and optimizing cloud deployments along with their associated costs.

Our strategy is to assist our customers in aligning cloud strategy with business objective, creating an enterprise cloud foundation, enabling multi-cloud capabilities, accelerating cloud migrations, modernizing the datacenter and extending to the cloud, and optimizing cloud deployments along with their associated costs.

We focus on being a guide to customers on their Journey to Modernization of applications, data, and platforms.

This strategy leverages our strength in deploying private clouds, extending them to public cloud and incorporating the necessary elements of networking and security.

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Over the last decade, cyber-attacks have become more sophisticated, numerous, and invasive.

Organizations are finding it increasingly difficult to effectively safeguard their information assets from a constant stream of advanced threats.

Organizations are finding it increasingly difficult to effectively safeguard their information assets and business operations from a constant stream of advanced threats.

Cyber-threats have shifted from uncoordinated individual efforts to highly coordinated and well-funded attacks by criminal organizations and nation-state actors.

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We believe our customers are focused on all aspects of cyber security, including information and physical security, data protection, intellectual property, and compliance requirements related to industry and government regulations.

To meet current and future security threats, enterprises must implement security controls and technology solutions that leverage integrated products and services to help monitor, mitigate, and remediate security threats and attacks while ensuring a data-centric security model .

Security products and services were 19.3%, 19.5% and 18.6%, respectively, of our total adjusted gross billings the years ended March 31, 2020, 2019, and 2018.

To meet current and future security threats, enterprises must identify their risks, implement security controls and technology solutions that leverage integrated products and services to help monitor, mitigate, and remediate security threats and attacks while ensuring a data-centric security model that is scalable to meet today’s digital demands .

Disruptive technologies are creating complexity and challenges for customers and vendors.

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As IT consumption shifts from legacy, on-premise infrastructure to agile “on-demand” and “as-a-service” solutions, customer procurement decisions are shifting from traditional IT personnel to lines-of-business personnel, which is changing the customer engagement model and types of consultative services required to fulfill customer needs.

In addition, many of the services create recurring revenue streams payable over time, rather than upfront revenue.

In addition, many of the services create recurring annuity revenue streams payable over time, rather than upfront revenue.

Our partners are also evolving by developing more annuity models through subscription and consumption-based models operating both on-premises and the cloud.

Lack of sufficient internal IT resources at mid-sized and large enterprises, and scarcity of IT personnel in certain high-demand disciplines .

We believe that IT departments at mid-sized and large enterprises are facing pressure to deliver emerging technologies and business outcomes but lack the properly trained staff and the ability to hire personnel with high in-demand disciplines such as security and data analytics.

At the same time the prevalence of security threats, increased use of cloud computing, software-defined networking, new architectures, and rapid software development frameworks, the proliferation of mobile devices and bring-your-own-device (BYOD) policies, and complexity of multi-vendor solutions, have made it difficult for IT departments to implement high-quality IT solutions.

At the same time the prevalence of security threats, increased use of cloud computing, software-defined networking, new architectures, and rapid software development frameworks, the proliferation of mobile devices, dispersed workforces, employees working from home, bring-your-own-device (BYOD) policies, and complexity of multi-vendor solutions, have made it difficult for IT departments to implement high-quality IT solutions.

Reduction in the number of IT solutions providers .

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Our solutions and services include the following:

ePlus managed services offer a flexible subscription model to monitor, manage, and maximize business critical technologies—including cloud, security, data center, mobility, and collaboration;

ePlus managed services proactively monitors and manages a broad range of technologies on premises and in the cloud such as service desk, Infrastructure, Cloud Managed Backup and Recovery, Cloud Hosted Infrastructure & Managed Power Protection.

a flexible subscription model to monitor, manage, and maximize business critical technologies—including cloud, security, data center, mobility, and collaboration based on a an ITIL Framework with SOC 1/2 and HIPAA accreditation;

Professional services focus on cloud infrastructure, unified communications, collaboration, networking, storage, hyper-converged infrastructure, and virtual desktop infrastructure, supported by security and managed services solutions;

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ePlus Cloud Consulting Services (ECCS) is a suite of white-glove cloud services providing data protection via Cloud Managed Backup and Cloud Disaster Recovery, as well as hosting mission-critical workloads via Cloud Hosted Infrastructure.

Staff augmentation services provide customers with flexible headcount options while allowing them to access talent, fill specific technology skill gaps, or provide short-term or long-term IT professional help, which also includes services, such as Virtual Chief Information Officer (vCIO) and Virtual Chief Information Security Officer (vCISO), used to complement existing personnel and build three-to-five-year IT roadmaps.

Staff augmentation services provide customers with flexible headcount options, which may range from service desk to infrastructure to software developer skills.

Staff augmentation allows customers to access talent, fill specific technology skill gaps, or provide short-term or long-term IT professional help, which also includes services, such as Virtual Chief Information Officer (vCIO) and Virtual Chief Information Security Officer (vCISO), used to complement existing personnel and build three-to-five-year IT roadmaps.

Service desk provides outsourced functions including but not limited to server and desktop support to respond to our customers’ business demands while minimizing overhead.

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Financing Segment

Leasing and Financing:

We specialize in financing arrangements, including sales-type and operating leases;

loans, and consumption-based financing arrangements;

and underwriting and management of IT equipment and assets.

and underwriting and management and disposal of IT equipment and assets.

Our financing operations include sales, pricing, credit, contracts, accounting, risk management, and asset management.

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The solution incorporates value-added services at every step in the process, including:

Front-end processing, such as e Procurement, order aggregation, order automation, vendor performance measurement, ordering, reconciliation, and payment;

Front-end processing, such as procurement, order aggregation, order automation, vendor performance measurement, ordering, reconciliation, and payment;

Lifecycle and asset ownership services, including asset management, change management, and property tax filing;

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Large Addressable Market with Long-term Growth Opportunities Driven by Increasing IT Complexity

We participate in the IT market focusing on the data center, network, cloud, security, virtualization, and mobility segments of the industry, facilitated by our professional and managed service solutions.

We believe we are well-positioned in the IT solutions segment.

The IT market in which we compete has been and likely will continue to be negatively impacted by COVID-19.

Industry analysts’ growth estimates calendar year 2020 prior to COVID-19 have been retracted.

COVID-19 is impacting demand globally and some of our customer end markets may be impacted more significantly than others.

We are uncertain as to the extent and duration of the impact on the IT market.

Our products and services target large enterprises, the approximately 30,000 1 middle market companies with revenues from $100 million to $1 billion, the over 90,000 2 state and local governmental organizations, larger school districts, and the over 4,300 3 higher educational institutions in the US, and those same markets in the UK.

We believe IT organizations within these companies and organizations are facing pressure to deliver higher service levels with fewer resources, increasing their reliance on third parties who can provide complex, multi-vendor technology solutions, such as our company.

We sell IT solutions focusing on the data center, network, cloud, security, virtualization, and mobility segments of the industry, facilitated by our professional and managed service solutions.

We primarily target our sales efforts toward middle-market and large commercial entities, state and local governments, education, and healthcare customers throughout the US and in certain markets in Europe and Asia.

We believe IT departments in these organizations are facing pressure to deliver higher service levels with fewer resources, increasing their reliance on third-parties who can provide complex, multi-vendor technology solutions, such as our company.

Broad and Diverse Customer Base across a Wide Range of End Markets

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We believe our customers choose us for their complex IT infrastructure needs based on our track record of delivering best-of-breed solutions, value-added services, and close relationships with both established and emerging vendors.

We focus on obtaining and maintaining top-level engineering certifications and professional services expertise in advanced technologies of strategic vendors and possess over 1,700 certifications that are leveraged to help our customers achieve positive business outcomes.

We focus on obtaining and maintaining top-level engineering certifications and professional services expertise in advanced technologies of strategic vendors that we leverage to help our customers achieve positive business outcomes.

We have over 650 employees that collectively hold approximately 2,200 certification titles, across more than 60 vendors, with a heavy concentration in our top vendors.

Strategic Ability to Design and Integrate Cloud Solutions Across Multiple Vendors

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We leverage our strategic partnerships with leading vendors such as Amazon Web Services, Cisco Systems, Dell EMC, Hewlett Packard Enterprise, Microsoft Azure, NetApp, and VMware in conjunction with our professional, managed and lifecycle services to help our customers achieve their desired business outcomes.

1 NAICS Association, Count by Annual Sales – Updated March 2020, https://www.naics.com/business-lists/counts-by-company-size/

2 GovTech Navigator, 2019 US State and Local Governments by the Numbers, https://www.govtech.com/navigator/numbers/us-state---2019local-gov-by-the-numbers_121.html

News, A Guide to the Changing Number of U.S.

Universities, https://www.usnews.com/education/best-colleges/articles/2019-02-15/how-many-universities-are-in-the-us-and-why-that-number-is-changing

Proven Track Record of Successfully Integrating Acquisitions and Accelerating Growth

We view acquisitions as an important factor in our strategic growth plan.

Since 1997, we have successfully integrated 28 acquisitions.

Most recently, we have been active in tuck-in acquisitions to broaden our product offerings, sector reach, and geographic footprint, with recent acquisitions including:

Innovative Technology Systems & Solutions, Inc.

(“ABS Technology”) acquired in August 2019 is a Virginia Beach, Virginia- headquartered solutions provider with deep expertise in managed services, networking, collaboration, and security solutions.

ABS Technology enhances ePlus’ existing solutions portfolio and market position in Richmond and southern Virginia.

SLAIT Consulting, LLC (“SLAIT”) acquired in January 2019 is an IT consulting and solutions provider with a focus on security advisory and managed services, managed help desk, specialized IT, staffing augmentation, and data center solutions.

The acquisition solidifies e Plus’ footprint in the Mid-Atlantic and extends e Plus’ security consulting and managed services capabilities.

SLAIT brings e Plus additional consultative services in the area of GRC (governance, risk management, and compliance), customized help desk and managed services solutions, as well as a number of relationships with fast-growing emerging vendors and related sales and engineering capabilities.

Integrated Data Storage, LLC (“IDS”) acquired in September 2017, is an advanced data center solution provider focused on cloud enablement and managed services, including its proprietary IDS Cloud.

The acquisition expands e Plus’ footprint in the Midwest and enhances its sales and engineering capabilities in cloud services, disaster recovery and backup as a service, storage, data center, and professional services.

OneCloud Consulting, Inc.

(“OneCloud”) acquired in May 2017, is a deployment, cloud consulting, and training company.

The acquisition, based in Milpitas, California, with operations in the US and India, provides us with additional ability to address customers’ needs in cloud-based solutions and infrastructure, including DevOps, OpenStack, and other emerging technologies, to our broad customer base.

The company empowers organizations to design, deploy, and scale cutting-edge technologies to support the next phase of their business.

Specialized training courses are tailored to drive end-user technology adoption and workshop offerings range from Automation to Cloud, Infrastructure, DevOps, and OpenStack as well as emerging technologies in the Artificial Intelligence and Machine Learning space.

Consolidated Communications IT services and integration business (“Consolidated IT Services”), acquired in December 2016, provides data center, unified communications, networking, and security solutions, as well as expanded our sales presence in the upper Midwest.

IGX Acquisition Global, LLC, and IGX Support, LLC, including IGX Acquisition’s wholly-owned subsidiary, IGXGlobal UK Limited (collectively, “IGX”) – acquired in December 2015.

Expanded our sales presence in New York and New England, as well as an operating branch in London that serves the UK and global customers.

Since 1997, we have successfully integrated nearly 30 acquisitions.

Most recently, we have been active in tuck-in acquisitions to broaden our product offerings, sector reach, and geographic footprint.

We generally integrate acquired firms into the e Plus platform immediately, which allows us to maintain customers and vendor relationships, retain key employees from acquired firms, and accelerate growth.

We continue to review new acquisition opportunities to expand our global footprint and expand our offerings, however, due to the uncertain impact from the COVID-19 pandemic we may have additional criteria to evaluate each acquisition.

We continue to review new acquisition opportunities to expand our global footprint and expand our offerings.

Financial Performance Characterized by Growth and Profitability

We have focused on achieving top-line revenue growth while maintaining industry-leading gross margins – with a compound annual growth rate of 6.7% on net sales and 9.9% for consolidated gross profit, respectively, from April 1, 2014 to March 31, 2020.

Through our organic expansion and acquisitions, we have increased our employee base by 69.1% from April 1, 2014 to March 31, 2020.

The increase in our employee base has largely been in customer facing roles, which increased by 92.0% over the same period, as we continue to build our sales and services team while leveraging our operational infrastructure.

We have focused on achieving top-line revenue growth while maintaining industry-leading gross margins – with a compound annual growth rate of 4.2% on net sales and 7.0% for consolidated gross profit, respectively, from fiscal year 2017 to fiscal year 2021.

Through our organic expansion and acquisitions, we have increased our employee base by 33.0% from March 31, 2017 to March 31, 2021.

The increase in our employee base has largely been in customer facing roles, which represented 92.5% of the total increase in headcount over the same period, as we continue to build our sales and services team while leveraging our operational infrastructure.

GROWTH STRATEGY

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Be Our Customers’ Partner of Choice for Comprehensive IT and Lifecycle Solutions, Including Consulting, Managed and Professional Services, and Financing

We seek to become the primary provider of IT solutions for each of our customers, whether on-premise, cloud, or managed services-based.

We seek to become the primary provider of IT solutions and flexible financing solutions for each of our customers, whether on-premise, cloud, hybrid or managed services-based.

We strive to provide excellent customer service, pricing, availability, and advanced professional and managed services in an efficient manner.

We believe the increasing complexity of the IT ecosystem and the emergence of new technologies and vendors are factors that will lead to a growing demand from existing customers.

We have a large number of experienced pre-sales engineers engage with customers about the most advanced technologies.

We believe the increasing complexity of the IT ecosystem and the emergence of new technologies, vendors, licensing, and service options are factors that will lead to a growing demand from existing customers.

We have many experienced pre-sales engineers who engage with customers about the most advanced technologies.

Our account executives are trained on our broad solutions capabilities with access to many, category-focused subject-matter experts, which allow them to sell in a consultative business outcome-based manner that increases the likelihood of cross-selling our solutions.

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Second, within our existing and potential customer base, our advanced professional services are a key differentiator against competitors who cannot provide services or advanced services for these key technologies or across multiple vendor product lines.

Our managed services portfolio expanded this year to include Managed SDWAN, Service Desk, Carrier Expense Management, Cloud Cost Optimization, Vulnerability Management as a Service (VMaas), Nutanix and Aruba monitoring and management.

We have further increased our breadth and depth of engineering expertise through the integration of SLAIT and ABS Technology, supplementing our Cisco service offerings, expanding our Netapp SSC/EMS portfolio, and security solutions releases.

We have also enhanced our Managed Services and consolidated all ePlus annuity-based service solutions into a single service management platform to enhance customer experience.

We have further increased our breadth and depth of engineering expertise through the integration of recent acquisitions, supplementing our Cisco service offerings, expanding our Netapp SSC/EMS portfolio, and security solutions releases.

We have also enhanced our Managed Services and consolidated all e Plus annuity-based service solutions into a single service management platform to enhance customer experience.

Likewise, we have increased automation of Service Level Target reporting to ensure remediation and response are top-of-mind.

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We intend to increase our direct sales and go-to-market capabilities in each of our geographic areas.

We actively seek to acquire new account relationships through face-to-face field sales, electronic commerce, leveraging our partnerships with vendors, and targeted demand-generation activities to increase awareness of our solutions.

We actively seek to acquire new account relationships through personal relationships, electronic commerce, leveraging our partnerships with vendors, and targeted demand-generation activities to increase awareness of our solutions.

We also seek to broaden our customer base, expand our geographic reach, and improve our technology and professional services delivery capabilities.

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Part of our growth strategy is to hire purposefully and enhance our technical and skill base through strategic acquisitions.

Once recruited, w e believe that that our culture, competitive performance-based compensation, policies and labor practices contribute to strong relations with our employees.

We offer a range of affordable and flexible benefits options to assist with health and well-being.

As our employees are an important resource to us, we invest in their ongoing professional development.

Our education program provides financial support for employees who want to participate in undergraduate and graduate studies, continuing education, skill building including technical certifications, and other professional enrichment related to their position with ePlus.

Improve Operational Efficiencies

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We focus our sales and marketing efforts on becoming the primary provider of IT solutions for each of our customers.

We seek to acquire new account relationships through face-to-face field sales, leveraging our partnerships with manufacturers and targeted direct marketing to increase awareness of our solutions..

We actively seek to acquire new account relationships through personal relationships, electronic commerce, leveraging our partnerships with vendors and targeted demand-generation activities to increase awareness of our solutions.

We target middle-market and large commercial entities and state and local governments, and educational institution.

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We market to different areas within a customer’s organization, including business units as well as the IT department, or finance department, depending on the solutions.

As of March 31, 2020, our sales force consisted of 605 sales, marketing and sales support personnel organized regionally in 38 offices or warehouses and customer locations throughout the US, UK, India, and Singapore.

As of March 31, 2021, our sales force consisted of 589 sales, marketing and sales support personnel organized regionally across the US, UK, India, and Singapore.

INTELLECTUAL PROPERTY RIGHTS

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We cannot provide assurance that any patents, as issued, will prevent the development of competitive products or that our patents will not be successfully challenged by others or invalidated through the administrative process or litigation.

Our trademarks include e +®, e Plus®, Procure+®, Manage+®, Docpak®, Viewmark®, OneSource®, Where Technology Means More® and GRIT:

Girls Re-Imagining Tomorrow ® in the US, and IGXGlobal® in Great Britain and the European Union (“EU”).

We intend to use and protect these and our other marks, as we deem necessary.

We believe our trademarks have significant value and are an important factor in the marketing of our products.

In addition to our trademarks, we have service marks and over 20 registered copyrights and additional common-law trademarks and copyrights.

In the US, our registered trademarks include e +®, e Plus®, Procure+®, Manage+®, Docpak®, Viewmark®, OneSource®, Where Technology Means More® and GRIT:

Girls Re-Imagining Tomorrow ®.

We also have registered IGXGlobal®, and IGXGlobal an ePlus Technology, inc.

Company® and certain variations thereon in the United Kingdom and the European Union (“EU”).

We intend to use and protect these and our other marks, including common-law marks, as we deem necessary.

We have over 20 registered copyrights, in addition to unregistered copyrights in our website content, software, marketing and other written materials.

We believe our trademarks and copyrights have significant value and are an important factor in the marketing of our products.

Despite our efforts to protect our proprietary rights, unauthorized parties may attempt to copy aspects of our products or to obtain and use information that we regard as proprietary.

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Our systems automatically decrease trade credit lines based on assigned risk ratings.

In our financing segment, we manage our risk in assets we finance by assigning the contractual payments due under the financing arrangement to third-parties.

In our financing segment, we manage our risk in assets we finance by assigning the contractual payments due under the financing arrangement to third-parties and the continued monitoring of our customers’ credit profile.

We also use agency purchase orders to procure equipment for lease to our customers and otherwise take measures to minimize our inventory of financed assets.

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Credit Risk Loss Experience :

During the fiscal year ended March 31, 2020, we increased our reserves for credit losses by $1,004 thousand and incurred actual credit losses of $429 thousand.

During the fiscal year ended March 31, 2019, we increased our reserves for credit losses by $335 thousand and incurred actual credit losses of $385 thousand.

During the fiscal year ended March 31, 2021, we increased our allowance for credit losses by $1,436 thousand and incurred actual credit losses of $178 thousand.

During the fiscal year ended March 31, 2020, we increased our allowance for credit losses by $1,004 thousand and incurred actual credit losses of $429 thousand.

We rely on our vendors or distributors to fulfill a large majority of our shipments to our customers.

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As of March 31, 2020, we had open orders of $277.6 million and deferred revenues of $72.2 million.

We expect that most of open orders as of March 31, 2020, will be recognized within ninety days of that date.

We also expect that 77% of the deferred revenues as of March 31, 2020, will be recognized within the next twelve months.

As of March 31, 2020, we employed 1,579 employees who operated through 38 offices or warehouses, home offices, and customer sites.

No employees are represented by a labor union, and we believe that we have good relations with our employees.

We expect that most of the open orders and approximately 75% of deferred revenue as of March 31, 2021 will be recognized within the next 12 months.

HUMAN CAPITAL

Our employees’ collective dedication and talent enable us to be a trusted advisor to our customers.

As of March 31, 2021, we employed a total of 1,560 employees, including 1,510 in the US, 18 in the United Kingdom, 30 in India, and 2 in Singapore.

We believe we have a good relationship with our employees, and none are represented by a labor union.

In the early days of the COVID-19 pandemic, our Chief Executive Officer introduced the motto of “Be Safe, Be Smart, and Be Kind.” to convey the timeless qualities that embody the culture we have spent 30 years building and have been even more important during this past year.

Through our Code of Conduct, policies, our training, and the everyday actions of our leadership, we expect our employees to treat each other, our customers, and all our business partners consistent with the “Be Safe, Be Smart, Be Kind” motto, with respect and equality for all persons.

Corporate social responsibility is also an important part of our culture and focus efforts around supporting the communities in which we live and work.

A sample of our efforts include participating in One Tree Planted, Habitat for Humanity, and Be the Match.

Since 2017, we have sponsored GRIT:

Girls Re-Imagining Tomorrow in partnership with Cisco Systems, Inc.

GRIT exists for the sole purpose of introducing diverse groups of middle school girls to technology-focused career possibilities, with an emphasis on cyber security and artificial intelligence.

Functional Areas of our Employee Base

The functional areas of our employees are as follows:

Year Ended March 31,

Sales and marketing

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Software development and internal IT

Nearly one-third of our employees have a tenure of six or more years, and 15% have a tenure of more than 10 years.

Covid-19 Safety

During the past year, considering COVID-19, we implemented a flexible work from home strategy for all our offices, and provided training, policies and face coverings for our employees who perform essential services onsite with customers and in our integration centers, supporting critical infrastructure sectors.

Our flexible work from home strategy during the pandemic is designed to keep our employees and their families as well as our communities safe, and to support those who cannot return to the office due to childcare responsibilities while schools and day care centers are closed.

Attracting Talent

While we operate in a competitive labor environment, we believe that that our culture, competitive performance-based compensation, policies and labor practices contribute to strong relations with our employees.

We offer a range of affordable and flexible benefits options to assist with health and well-being.

New this fiscal year, we added Martin Luther King, Jr.

Day to our corporate holidays, which complements two personal days to allow employees flexibility for other holidays.

In recent years, we have received several Comparably Talent Awards in the Large Companies category, including in 2020:

Best CEO, Best Company Work-Life Balance, and Best CEO for Women.

Training and Development

As our employees are an important resource to us, we invest in their ongoing professional development.

New employees are assigned 30 short training videos during their first eight months of employment, covering soft skills, compliance, and our specific business.

All employees have access to ePlus University , which offers thousands of on-demand courses, from business and technical skills to leadership to compliance.

We also provide live and recorded presentations from numerous in-house leaders and experts in a variety of topics, as well as in-person workshops on management skills and leadership.

All employees are supported in, and expected to, remain current in the knowledge areas relevant to their position.

Our employee base of highly skilled, experienced personnel includes account executives, pre-sales and inside-sales staff trained on our broad solutions capabilities and category-focuses subject-matter experts.

Additionally, we have over 650 employees that collectively hold approximately 2,200 certification titles, across more than 60 vendors, with a heavy concentration in our top vendors.

US SECURITIES AND EXCHANGE COMMISSION REPORTS

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Prior to that, she was the Controller of e Plus Technology, inc., a subsidiary of e Plus, from 1998 to 2004.

Marion currently serves on the Advisory Board of the School of Business at the University of Mary Washington and as a member of the George Mason University School of Business Dean’s Advisory Council.

Marion currently serves on the Advisory Board of the School of Business at the University of Mary Washington and as chair of the George Mason University School of Business Dean’s Advisory Council.

Marion is a graduate of George Mason University, where she earned a Bachelor of Science degree in Business Administration with a concentration in Accounting.

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business