What changed in this filing

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Item 8. Financial Statements and Supplementary Data

2021-08-12 compared with 2020-08-13 · 553 added, 423 removed, 280 unchanged (78% of the section changed)

8 Financial Statements

to Financial Statements

Risk Industries, Inc.

of Independent Registered Public Accounting Firm

Sheets—April 30, 2020 and 2019

Report of Independent Registered Public Accounting Firm

Balance Sheets—April 30, 2021 and 2020

Statements of Income For the Years Ended April 30, 2021 and 2020

2 unchanged sentences

Equity For the Years Ended April 30, 2021 and 2020

of Cash Flows For the Years Ended April 30, 2020 and 2019

to Financial Statements

Risk Industries, Inc.

of April 30, 2020 and 2019

Statements of Cash Flows For the Years Ended April 30, 2021 and 2020

Notes to Financial Statements

of Independent Registered Public Accounting Firm

To the Board of Directors

George Risk Industries, Inc.

on the Financial Statements

We have audited the accompanying balance sheets

of George Risk Industries, Inc.

(the Company) as of April 30, 2021 and 2020, and the related statements of income, comprehensive income,

stockholders’

equity, and cash flows for each of the years in the two-year period ended April 30, 2021, 2020, and the related notes

(collectively referred to as the financial statements).

In our opinion, the financial statements present fairly, in all material respects,

the financial position of the Company as of April 30, 2021 and 2020, and the results of its operations and its cash flows for each of

the years in the two-year period ended April 30, 2021 and 2020, in conformity with accounting principles generally accepted in the United

States of America.

These financial statements are the responsibility

of the Company’s management.

Our responsibility is to express an opinion on the Company’s financial statements based on our

We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are

required to be independent with respect to the Company in accordance with the U.S.

federal securities laws and the applicable rules and

regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with

the standards of the PCAOB.

Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the

financial statements are free of material misstatement, whether due to error or fraud.

The Company is not required to have, nor were

we engaged to perform, an audit of its internal control over financial reporting.

As part of our audits, we are required to obtain an

understanding of internal control over financial reporting, but not for the purpose of expressing an opinion on the effectiveness of

the Company’s internal control over financial reporting.

Accordingly, we express no such opinion.

Our audits included performing procedures

to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that

respond to those risks.

Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial

Our audits also included evaluating the accounting principles used and significant estimates made by management, as well

as evaluating the overall presentation of the financial statements.

We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matters

The critical audit matters communicated below

are matters arising from the current period audit of the financial statements that were communicated or required to be communicated to

the audit committee and that:

(1) relate to accounts or disclosures that are material to the financial statements and (2) involved our

especially challenging, subjective, or complex judgments.

The communication of critical audit matters does not alter in any way our opinion

on the financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate

opinions on the critical audit matters or on the accounts or disclosures to which they relate.

Critical Audit Matter - Revenue Recognition

Refer to Note 1 of the Financial Statements

Critical Audit Matter Description

The Company primarily generates revenue through

non-complex sales transactions that require limited judgement.

However, there are instances in which revenue contracts contain complexities

that are subject to critical judgment around when the performance obligation is satisfied.

These specific elements of revenue are variable

considerations and returns and allowances.

Consideration

in contracts with customers is variable due to anticipated reductions such as discounts, rebates and allowances.

Accordingly, revenues

are recorded net of estimated variable consideration and returns and allowances, based on known or expected adjustments.

matter was considered a critical audit matter as there is a high degree of auditor effort in performing procedures and evaluating audit

evidence related to contractual terms in customer arrangements to determine the amount of consideration.

the Critical Audit Matter Was Addressed in the Audit

principal procedures related to the Company’s revenue recognition for these specific elements are the following:

evaluated management’s significant accounting policies related to various elements of revenue recognition.

performed analytical procedures to test the reasonableness of recorded balances.

a sample of transactions, we inspected source documents, including customer contracts or purchase orders, third-party shipping information,

invoices, and relevant communication.

contractual terms in customer arrangements that impact management determination of the variable consideration related to the products

and related recognition of revenue on a sample basis.

Audit Matter –

Valuation of Investments –

Refer to Note 1 and Note 3 of the Financial Statements

Audit Matter Description

Company has investments in publicly traded equity securities, state and municipal debt securities, REITS, and money markets and they

are recorded at fair value.

Some of these investments are Level 2 investments and can be hard to value.

In addition, as the securities

held at fair value, management must assess securities that are in a significant unrealized loss position for other than temporary impairment.

For these securities, management must make difficult and subjective judgements about the ability of the issuer to be able to meet its

obligations under terms of the security.

These judgements can have a significant impact on the Company’s reported earnings if they

should prove to be significantly inaccurate.

the Critical Audit Matter Was Addressed in the Audit

principal procedures related to the Company’s process for debt securities valuations as well as the process for equity securities

other than temporary impairment evaluation included:

evaluated management’s significant accounting policies related to the identification of other than temporary impairment.

specialists, with specialized skills and knowledge, were involved in the assessment of the fair values for a sample of Level 2 investments.

performed testing over a sample of securities to determine if conclusions reached by management regarding other than temporary impairment

were appropriate.

have served as the Company’s auditor since 1992.

George Risk Industries, Inc.

Balance Sheets

As of April 30, 2021 and 2020

Current Assets:

8 unchanged sentences

Property and Equipment, at cost, net

Investment in Limited Land Partnership –

Held for Sale, at cost

Investment in Limited Land Partnership, at cost

Projects in process

2 unchanged sentences

accompanying notes are an integral part of these financial statements.

Risk Industries, Inc.

Sheets (Continued)

of April 30, 2020 and 2019

George Risk Industries, Inc.

Balance Sheets (Continued)

As of April 30, 2021 and 2020

LIABILITIES AND STOCKHOLDERS’

4 unchanged sentences

Payroll and related expenses

Income tax payable

Notes payable

6 unchanged sentences

Stockholders’

Equity Convertible preferred stock, 1,000,000 shares authorized, Series 1—noncumulative, $20 stated value, 25,000 shares authorized, 4,100 issued and outstanding

Common stock, Class A, $.10 par value, 10,000,000 shares authorized, 8,502,881 shares issued and outstanding

Convertible preferred stock, 1,000,000 shares authorized,

Series 1—noncumulative, $20 stated value, 25,000 shares

authorized, 4,100 issued and outstanding

Common stock, Class A, $.10 par value, 10,000,000 shares

authorized, 8,502,881 shares issued and outstanding

Additional paid-in capital

5 unchanged sentences

accompanying notes are an integral part of these financial statements.

Risk Industries, Inc.

the years ended April 30, 2020 and 2019

George Risk Industries, Inc.

Income Statements

For the years ended April 30, 2021 and 2020

April 30, 2021

22 unchanged sentences

accompanying notes are an integral part of these financial statements.

Risk Industries, Inc.

of Comprehensive Income

the years ended April 30, 2020 and 2019

George Risk Industries, Inc.

Statements of Comprehensive Income

For the years ended April 30, 2021 and 2020

April 30, 2021

7 unchanged sentences

accompanying notes are an integral part of these financial statements.

Risk Industries, Inc.

of Stockholders’

the Years Ended April 30, 2020 and 2019

George Risk Industries, Inc.

Statements of Stockholders’

For the Years Ended April 30, 2021 and 2020

Preferred Stock

Common Stock Class A

Stock Class A

Balances, April 30, 2019

Cumulative effect of the adoption of ASU 2016-01

Balance at May 1, 2018, after adoption of ASU 2016-01

Purchases of common stock

7 unchanged sentences

accompanying notes are an integral part of these financial statements.

Risk Industries, Inc.

of Stockholders’

the Years Ended April 30, 2020 and 2019

Comprehensive

George Risk Industries, Inc.

Statements of Stockholders’

For the Years Ended April 30, 2021 and 2020

Treasury Stock

(Common Class A)

Accumulated Other Comprehensive

Income (Loss)

$ (4,227,000 )

11 unchanged sentences

Unrealized (gain) loss on equity securities

PPP loan forgiven

Bad debt expense

10 unchanged sentences

Accounts payable

Accrued expense

Accrued expenses

Income tax payable

Net cash from operating activities

22 unchanged sentences

to Financial Statements

of Business and Summary of Significant Accounting Policies

Nature of Business and Summary of Significant Accounting Policies

Risk Industries, Inc.

(GRI or the Company) was incorporated in 1967 in Colorado.

The Company is presently engaged in the design,

manufacture, and sale of custom computer keyboards, push button switches, burglar alarm components and systems, pool alarms, EZ

Duct wire covers, water sensors and wire and cable installation tools.

The Company is presently engaged in the design, manufacture,

and sale of custom computer keyboards, proximity switches, security alarm components and systems, pool access alarms, EZ Duct wire covers,

water sensors, electronic switching devices, high security switches, and wire and cable installation tools.

of Business —

The Company is engaged in the design, manufacture, and marketing of custom computer keyboards, push-button

switches, proximity sensors, security alarm components, pool alarms, liquid detection sensors, raceway wire covers, wire and cable

installation tools and various other sensors and devices.

The Company is engaged in the design, manufacture, and marketing of custom computer keyboards, proximity sensors,

security alarm components, pool access alarms, liquid detection sensors, raceway wire covers, wire and cable installation tools and various

other sensors and devices.

and Cash Equivalents —

1 unchanged sentence

The Company maintains its cash in bank deposit accounts, the balances of which at times may exceed federally insured limits.

Company continually monitors its banking relationships and consequently has not experienced any losses in such accounts.

believes it is not exposed to any significant credit risk on cash and cash equivalents.

continually monitors its banking relationships and consequently has not experienced any losses in such accounts.

The Company believes

it is not exposed to any significant credit risk on cash and cash equivalents.

for Doubtful Accounts —

Accounts receivable are customer obligations due under normal trade terms.

The Company sells

its products to security alarm distributors, alarm installers, and original equipment manufacturers.

The Company performs continuing

credit evaluations of its customers’

The Company sells its products

to security alarm distributors, alarm installers, and original equipment manufacturers.

The Company performs continuing credit evaluations

of its customers’

financial condition and the Company generally does not require collateral.

Company records an allowance for doubtful accounts based on an analysis of specifically identified customer balances.

has a limited number of customers with individually substantial amounts due at any given date.

Any unanticipated change in any

one of these customers’

credit worthiness or other matters affecting the collectability of amounts due from such customers

could have a material effect on the results of operations in the period in which such changes or events occur.

After all attempts

to collect a receivable have failed, the receivable is written off.

The Company has recorded an allowance for doubtful accounts

of $7,306 for the year ended April 30, 2020 and $9,321 for the year ended April 30, 2019.

For the fiscal year ended April 30,

2020, bad debt recovery was $156.

The Company has

a limited number of customers with individually substantial amounts due at any given date.

Any unanticipated change in any one of these

customers’

credit worthiness or other matters affecting the collectability of amounts due from such customers could have a material

effect on the results of operations in the period in which such changes or events occur.

After all attempts to collect a receivable have

failed, the receivable is written off.

The Company has recorded an allowance for doubtful accounts of $9,947 for the year ended April

30, 2021 and $7,306 for the year ended April 30, 2020.

For the fiscal year ended April 30, 2021, bad debt expense was $1,828.

fiscal year ended April 30, 2020, bad debt recovery was $156.

Inventories are stated at the lower of cost or net realized value.

Cost is determined using the average cost-pricing

Cost is determined using the average cost-pricing method.

The Company uses actual costs to price its manufactured inventories, approximating average costs.

of Business and Summary of Significant Accounting Policies, continued

Nature of Business and Summary of Significant Accounting Policies, continued

and Equipment —

Property and equipment are recorded at cost.

Depreciation is calculated based on the following estimated

useful lives using the straight-line method:

Depreciation is calculated based on the following estimated useful

lives using the straight-line method:

Classification

2 unchanged sentences

Furniture and fixtures

Leasehold improvements

Accumulated depreciation

equipment, net

Property and equipment, net

expense of $278,000 and $250,000 was charged to operations for the years ended April 30, 2021 and 2020, respectively.

and repairs are charged to expense as incurred, and expenditures for major improvements are capitalized.

When assets are retired

or otherwise disposed of, the property accounts are relieved of costs and accumulated depreciation and any resulting gain or loss

is credited or charged to operations.

in Limited Land Partnership –

Held for Sale —

In November 2002, the Company purchased 6.67% of a prime

22-acre land parcel for development in Winter Park-Grand County, CO for investment purposes for a total of $200,000.

was to hold the property for resale(s) in 2-5 years, but many efforts to sell the property have not materialized.

Over the years,

there have been a total of $120,000 of additional contributions to aid in improvements and recurring expenses such as debt service,

utilities, taxes, maintenance, insurance and professional fees.

Management has evaluated this investment and does not believe

there is any impairment and that the full cost will be recovered when sold.

When assets are retired or otherwise

disposed of, the property accounts are relieved of costs and accumulated depreciation and any resulting gain or loss is credited or charged

to operations.

in Limited Land Partnership —

In November 2002, the Company purchased 6.67% of a prime 22-acre land parcel for development

in Winter Park-Grand County, CO for investment purposes for a total of $200,000.

The goal was to hold the property for resale(s) in 2-5

years, but many efforts to sell the property have not materialized.

Over the years, there have been a total of $120,000 of additional

contributions to aid in improvements and recurring expenses such as debt service, utilities, taxes, maintenance, insurance and professional

Management has evaluated this investment and does not believe there is any impairment and that the full cost will be recovered

Assets —

1 unchanged sentence

their lives to be indefinite.

The two intangible assets currently being amortized are (1) a non-compete agreement with a useful

live of 5 years and (2) intellectual property with a useful live of 15 years.

As of April 30, 2020, the Company had $1,517,000

of net intangible asset costs, while the net intangible assets costs at April 30, 2019 were $1,640,000.

Amortization expense was

$123,000 for the years ended April 30, 2020 and 2019, respectively.

of Business and Summary of Significant Accounting Policies, continued

The two intangible assets currently being amortized are (1) a non-compete agreement with a useful live

of 5 years and (2) intellectual property with a useful live of 15 years.

As of April 30, 2021, the Company had $1,394,000 of net intangible

asset costs, while the net intangible assets costs at April 30, 2020 were $1,517,000.

Amortization expense was $123,000 for the years

ended April 30, 2021 and 2020, respectively.

Nature of Business and Summary of Significant Accounting Policies, continued

of April 30, 2021, future amortization of intangible assets is expected as follows:

Fiscal year end

and Diluted Earnings per Share —

The Company computes earnings per share in accordance with ASC 260-10-45 Earnings per

Share, which requires presentation of both basic and diluted earnings per share on the face of the statement of income.

earnings per share is computed by dividing net earnings available to common stockholders by the weighted average number of outstanding

common shares during the period.

Diluted earnings per share gives effect to all dilutive potential common shares outstanding during

Dilutive earnings per share excludes all potential common shares if their effect is anti-dilutive.

The Company computes earnings per share in accordance with ASC 260-10-45 Earnings per Share,

which requires presentation of both basic and diluted earnings per share on the face of the statement of income.

Basic earnings per share

is computed by dividing net earnings available to common stockholders by the weighted average number of outstanding common shares during

Diluted earnings per share gives effect to all dilutive potential common shares outstanding during the period.

Dilutive earnings

per share excludes all potential common shares if their effect is anti-dilutive.

Advertising costs are expensed as incurred and are included in selling expenses.

2 unchanged sentences

Taxes —

Deferred tax assets and liabilities are recorded for the future consequences of events that have been recognized

in the Company’s financial statements or tax returns.

Deferred tax assets and liabilities are recorded for the future consequences of events that have been recognized in

the Company’s financial statements or tax returns.

Measurement of the deferred tax items is based on enacted tax laws.

In the event the future consequences of differences between financial reporting bases and tax bases of the Company’s assets

or liabilities result in a deferred tax asset, we evaluate the probability of realizing the future benefits comprising that asset

and record a valuation allowance if considered necessary.

standards prescribe a recognition threshold and a measurement attribute for the financial statement recognition and measurement

of the positions taken or expected to be taken in a tax return.

For those benefits to be recognized, a tax position must be more

likely than not to be sustained upon examination by taxing authorities.

the future consequences of differences between financial reporting bases and tax bases of the Company’s assets or liabilities result

in a deferred tax asset, we evaluate the probability of realizing the future benefits comprising that asset and record a valuation allowance

if considered necessary.

standards prescribe a recognition threshold and a measurement attribute for the financial statement recognition and measurement of the

positions taken or expected to be taken in a tax return.

For those benefits to be recognized, a tax position must be more likely than

not to be sustained upon examination by taxing authorities.

A “more likely than not”

tax position is measured

as the largest amount of benefit that is greater than a fifty percent likelihood of being realized upon ultimate settlement, or

else a full reserve is established against the tax asset or a liability is recorded.

Tax years open for examination by taxing

authorities are 2016, 2017, and 2018.

tax position is measured as the largest

amount of benefit that is greater than a fifty percent likelihood of being realized upon ultimate settlement, or else a full reserve

is established against the tax asset or a liability is recorded.

Tax years open for examination by taxing authorities are 2017, 2018,

Interest and penalties accrued on uncertain tax positions are recorded as income tax expense.

It has been determined that the Company

does not have uncertain tax positions on its tax returns for the years 2020, 2019, and prior.

Based on evaluation of the 2020

transactions and events, the Company does not have any material

uncertain tax positions that require measurement.

Nature of Business and Summary of Significant Accounting Policies, continued

Estimates —

The preparation of these financial statements requires the use of estimates and assumptions including the

carrying value of assets.

The preparation of these financial statements requires the use of estimates and assumptions including the carrying

value of assets.

The estimates and assumptions result in approximate rather than exact amounts.

of Business and Summary of Significant Accounting Policies, continued

Value of Financial Instruments —

Certain financial instruments are required to be recorded at fair value.

assumptions or estimation methods could affect the fair value estimates;

however, we do not believe any such changes would have

a material impact on our financial condition, results of operations or cash flows.

Other financial instruments, including cash

equivalents, certain investments and short-term debt, are recorded at cost, which approximates fair value.

The fair values of

long-term debt and financial instruments are disclosed in Note 11.

Changes in assumptions

or estimation methods could affect the fair value estimates;

however, we do not believe any such changes would have a material impact

on our financial condition, results of operations or cash flows.

Other financial instruments, including cash equivalents, certain investments

and short-term debt, are recorded at cost, which approximates fair value.

The fair values of long-term debt and financial instruments

are disclosed in Note 11.

The accounting policies for the Company’s principal investments are as follows:

Debt Securities and Equity

Debt Securities and Equity Securities:

Effective May 1, 2018, the Company adopted Accounting Standards Update (“ASU”) 2016-01 “Financial Instruments-Overall

(ASC Subtopic 825-10):Recognition and Measurement of Financial Assets and Financial Liabilities”

(ASC Subtopic 825-10):

Recognition and Measurement of Financial Assets and Financial Liabilities”

(“ASU 2016-01”).

(See the Adoption of New Pronouncements section).

As a result, the Company measures its equity securities at fair value and recognizes

any changes in fair value in net income.

Prior to adoption, equity securities were designated as available-for-sale and reported

at fair value with unrealized capital gains (losses) recorded in Accumulated other comprehensive income (loss) (“AOCI”).

The Company’s Debt Securities are currently designated as available-for-sale.

Available-for-sale securities are reported

at fair value and unrealized capital gains (losses) on these securities are recorded directly in AOCI and presented net of related

changes in deferred income taxes.

Purchases and sales of debt securities and equity securities are recorded on the trade date.

Investment gains and losses on sales of securities are generally determined on a first-in-first-out (“FIFO”) basis.

Company evaluates all marketable securities for other-than temporary declines in fair value, which are defined as when the cost

basis exceeds the fair value for approximately one year.

The Company also evaluates the nature of the investment, cause of impairment

and number of investments that are in an unrealized position.

As a result, the Company measures its equity securities at fair value and recognizes any changes in fair value in net income.

adoption, equity securities were designated as available-for-sale and reported at fair value with unrealized capital gains (losses) recorded

in Accumulated other comprehensive income (loss) (“AOCI”).

The Company’s debt securities are currently designated as

available-for-sale.

Available-for-sale securities are reported at fair value and unrealized capital gains (losses) on these securities

are recorded directly in AOCI and presented net of related changes in deferred income taxes.

Purchases and sales of debt securities and

equity securities are recorded on the trade date.

Investment gains and losses on sales of securities are generally determined on a first-in-first-out

(“FIFO”) basis.

Company evaluates all marketable securities for other-than temporary declines in fair value, which are defined as when the cost basis

exceeds the fair value for approximately one year.

The Company also evaluates the nature of the investment, cause of impairment and number

of investments that are in an unrealized position.

When an “other-than-temporary”

decline is identified,

the Company will decrease the cost of the marketable security to the new fair value and recognize a real loss.

The investments

are periodically evaluated to determine if impairment changes are required.

decline is identified, the Company will

decrease the cost of the marketable security to the new fair value and recognize a real loss.

The investments are periodically evaluated

to determine if impairment changes are required.

Recognition —

Effective May 1, 2018, the Company adopted Accounting Standards Codification (“ASC”) 606,

“Revenue from Contracts with Customers.”

The Company recognizes product revenue using a five-step approach to determine

the amount and timing of revenue to be recognized.

The five-step approach requires (1) identifying the contract with the customer,

(2) identifying the performance obligations in the contract, (3) determining the transaction price, (4) allocating the transaction

price to the performance obligations in the contract and (5) recognizing revenue when performance obligations are satisfied.

Company recognizes revenue for product sales upon transfer of title to the customer.

Customer purchase orders and/or contracts

are generally used to determine the existence of an arrangement.

Shipping documents and the completion of any customer acceptance

requirements, when applicable, are used to verify product delivery or that services have been rendered.

The Company assesses whether

a price is fixed or determinable based upon the payment terms associated with the transaction and whether the sales price is subject

to refund or adjustment.

Payments received from customers in advance of product shipment or revenue recognition are treated as

deferred revenues and recognized when the product is shipped.

Variable Consideration

-- The Company measures revenue as the amount of consideration for which it expects to be entitled in exchange for transferring

Certain customers may receive cash and/or non-cash incentives such as cash rebates, customer discounts (such as volume

or trade discounts), which are accounted for as variable consideration.

Effective May 1, 2018, the Company adopted Accounting Standards Codification (“ASC”) 606, “Revenue

from Contracts with Customers.”

The Company recognizes product revenue using a five-step approach to determine the amount and timing

of revenue to be recognized.

The five-step approach requires (1) identifying the contract with the customer, (2) identifying the performance

obligations in the contract, (3) determining the transaction price, (4) allocating the transaction price to the performance obligations in the contract and

(5) recognizing revenue when performance obligations are satisfied.

The Company recognizes revenue for product sales upon transfer of

title to the customer.

Customer purchase orders and/or contracts are generally used to determine the existence of an arrangement.

documents and the completion of any customer acceptance requirements, when applicable, are used to verify product delivery or that services

have been rendered.

The Company assesses whether a price is fixed or determinable based upon the payment terms associated with the transaction

and whether the sales price is subject to refund or adjustment.

Payments received from customers in advance of product shipment or revenue

recognition are treated as deferred revenues and recognized when the product is shipped.

of Business and Summary of Significant Accounting Policies, continued

Consideration —

The Company measures revenue as the amount of consideration for which it expects to be entitled in exchange

for transferring goods.

Certain customers may receive cash and/or non-cash incentives such as cash rebates, customer discounts (such

as volume or trade discounts), which are accounted for as variable consideration.

In some cases, the Company must apply judgment, including

contractual rates and historical payment trends, when estimating variable consideration.

Product Returns

-- In the normal course of business, the Company may allow customers to return product per the provisions in a sale agreement.

Estimated product returns are recorded as a reduction in reported revenues with offsetting entries recorded in the balance sheet

quarterly based upon historical product return experience, adjusted for known trends, to arrive at the amount of consideration

Returns —

In the normal course of business, the Company may allow customers to return product per the provisions in a sale

Estimated product returns are recorded as a reduction in reported revenues with offsetting entries recorded in the balance

sheet quarterly based upon historical product return experience, adjusted for known trends, to arrive at the amount of consideration

expected to receive.

Product Warranties

Warranties —

In the normal course of business, the Company offers warranties for a variety of its products.

The specific terms and conditions

of the warranties vary depending upon the specific product and markets in which the products were sold.

The Company accrues for

the estimated cost of product warranty at the time of sale based on historical experience.

of Business and Summary of Significant Accounting Policies, continued

The specific terms

and conditions of the warranties vary depending upon the specific product and markets in which the products were sold.

The Company accrues

for the estimated cost of product warranty at the time of sale based on historical experience.

and Handling Costs —

2 unchanged sentences

Shipping and handling costs are recorded as cost of sales.

and Development Costs —

Generally, costs related to the research, design, and development of products are charged to engineering

expense as incurred.

Certain research and development costs are recognized under assets in the balance sheet.

Comprehensive

2 unchanged sentences

of the components of non-stockholder changes in equity on an annual basis.

Total non-stockholder changes in equity include all

changes in equity during a period except those resulting from fiscal investments by and distributions to stockholders.

Total non-stockholder changes in equity include all changes

in equity during a period except those resulting from fiscal investments by and distributions to stockholders.

Reporting and Related Information —

The Company designates the internal organization that is used by management for

allocating resources and assessing performance as the source of the Company’s reportable segments.

US GAAP also requires

disclosures about products and services, geographic area and major customers.

At April 30, 2020, the Company operated in three

segments organized by security line products, cable and wiring tools (Labor Saving Devices - LSDI) products, and all other products.

See Note 9 for further segment information disclosures.

The Company designates the internal organization that is used by management for allocating

resources and assessing performance as the source of the Company’s reportable segments.

US GAAP also requires disclosures about

products and services, geographic area and major customers.

At April 30, 2021, the Company operated in three segments organized by security

line products, cable and wiring tools (Labor Saving Devices - LSDI) products, and all other products.

See Note 9 for further segment

information disclosures.

of Business and Summary of Significant Accounting Policies, continued

Issued Accounting Pronouncements —

In June 2016, the FASB issued ASU No.

2016-13, “

Financial Instruments –

Credit Losses (Topic 326):

Measurement of Credit Losses on Financial Instruments ”, which requires entities to

use a forward looking approach based on expected losses to estimate credit losses on certain types of financial instruments, including

trade receivables.

The FASB has subsequently issued updates to the standard to provide additional clarification on specific topics.

Topic 326 is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019.

a result, we are required to apply this guidance in our fiscal 2021 interim and annual financial statements commencing May 1,

Currently, we do not expect this guidance to impact our results of operations, financial position, or statement of cash

In June 2016 the FASB issued ASU 2016-13, “Financial Instruments - Credit Losses

(Topic 326),”

which was subsequently amended in February 2020 by ASU 2020-02, “Financial Instruments - Credit Losses

(Topic 326) and Leases (Topic 842).”

The amendments introduce an impairment model that is based on expected credit losses,

rather than incurred losses, to estimate credit losses on certain types of financial instruments (e.g., loans and held-to-maturity securities),

including certain off-balance sheet financial instruments (e.g., loan commitments).

The expected credit losses should consider historical

information, current information, and reasonable and supportable forecasts, including estimates of prepayments, over the contractual

Financial instruments with similar risk characteristics may be grouped together when estimating expected credit losses.

with amendment is effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years.

The Company does not believe this new guidance will have a material impact on its financial statements and will implement the disclosures

related to this update beginning in 2023.

August 2018, the FASB issued ASU 2018-13, Fair Value Measurement - Disclosure Framework (Topic 820).

The updated guidance improves

the disclosure requirements on fair value measurements.

The updated guidance is effective for fiscal years, and interim periods

within those fiscal years, beginning after December 15, 2019.

The updated guidance improves the

disclosure requirements on fair value measurements.

The updated guidance is effective for fiscal years, and interim periods within those

fiscal years, beginning after December 15, 2019.

Early adoption is permitted for any removed or modified disclosures.

We do not expect this guidance to impact our results of operations, financial position, or statement of cash flow.

January 2020, the FASB issued ASU 2020-01, “Investments - Equity Securities (Topic 321), Investments - Equity Method and

Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815) - Clarifying the Interactions between Topic 321, Topic 323,

and Topic 815.”

The ASU is based on a consensus of the Emerging Issues Task Force and is expected to increase comparability

in accounting for these transactions.

ASU 2016-01 made targeted improvements to accounting for financial instruments, including

providing an entity the ability to measure certain equity securities without a readily determinable fair value at cost, less any

impairment, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar

investment of the same issuer.

Among other topics, the amendments clarify that an entity should consider observable transactions

that require it to either apply or discontinue the equity method of accounting.

For public business entities, the amendments in

the ASU are effective for fiscal years beginning after December 15, 2020, and interim periods within those fiscal years.

adoption is permitted.

The Company does not expect the adoption of ASU 2020-01 to have a material impact on its financial statements.

We applied this

guidance, as of May 1, 2020.

The application of this guidance did not have a material effect on our disclosures.

January 2020, the FASB issued ASU 2020-01, “Investments - Equity Securities (Topic 321), Investments - Equity Method and Joint

Ventures (Topic 323), and Derivatives and Hedging (Topic 815) - Clarifying the Interactions between Topic 321, Topic 323, and Topic 815.”

The ASU is based on a consensus of the Emerging Issues Task Force and is expected to increase comparability in accounting for these transactions.

ASU 2016-01 made targeted improvements to accounting for financial instruments, including providing an entity the ability to measure

certain equity securities without a readily determinable fair value at cost, less any impairment, plus or minus changes resulting from

observable price changes in orderly transactions for the identical or a similar investment of the same issuer.

Among other topics, the

amendments clarify that an entity should consider observable transactions that require it to either apply or discontinue the equity method

of accounting.

For public business entities, the amendments in the ASU are effective for fiscal years beginning after December 15, 2020,

and interim periods within those fiscal years.

Early adoption is permitted.

The Company does not expect the adoption of ASU 2020-01 to

have a material impact on its financial statements.

are no other new accounting pronouncements that are expected to have a significant impact on our financial statements.

of Business and Summary of Significant Accounting Policies, continued

Nature of Business and Summary of Significant Accounting Policies, continued

Events –

Management has evaluated all events or transactions that occurred after April 30, 2020 through August 13, 2020,

the report date of the financial statements.

During and subsequent to the fourth quarter of the current fiscal year, the world

has been impacted by the spread of the coronavirus (COVID-19).

It has created significant economic uncertainty and volatility.

The extent to which the coronavirus pandemic impacts our business, operations and financial results will depend on numerous evolving

factors that we may not be able to accurately predict, including:

the duration and scope of the pandemic;

governmental, business

and individuals’

actions that have been and continue to be taken in response to the pandemic;

the impact of the pandemic

on economic activity and actions taken in response;

the effect on our clients and client demand for our services and solutions;

our ability to sell and provide our services and solutions, including as a result of travel restrictions and people working from

the ability of our clients to pay for our services and solutions;

and any closures of our and our clients’

and facilities.

Any of these events could materially adversely affect our business, financial condition, results of operations

and/or stock price.

Company manufactures and supplies “essential”

products and services to many critical industries, so our production

facilities will continue to operate.

The health and safety of our employees and their families remains our top priority.

we have implemented many Center of Disease Control protocols to keep our employees safe while the Company continues to produce

products and provide service to our customers.

While we are operating in a rapidly changing environment, we also continue to hear

positive news from our raw material suppliers.

Management has evaluated all events or transactions that occurred after April 30, 2021 through August 11, 2021, the

report date of the financial statements.

During this period, the Company did not have any material recognizable subsequent events.

at April 30, 2021 and 2020, consisted of the following:

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Finished goods

for obsolete inventory

Company has investments in publicly traded equity securities, corporate bonds, state and municipal debt securities, REITs, money

markets, and certificates of deposits and they are recorded at fair value.

The investments in debt securities, which include municipal

bonds, bond funds, and corporate bonds, mature between June 2020 and January 2044.

The Company uses the average cost method to

determine the cost of equity securities sold with any unrealized gains or losses reported in the respective period’s earnings.

Inventory in transit

allowance for obsolete inventory

Inventories, net

Company has investments in publicly traded equity securities, state and municipal debt securities, REITs, and money markets and they

are recorded at fair value.

The investments in debt securities, which include municipal bonds and bond funds, mature between August 2021

and January 2044.

The Company uses the average cost method to determine the cost of equity securities sold with any unrealized gains

or losses reported in the respective period’s earnings.

Dividend and interest income are reported as earned.

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Investments at

April 30, 2021

Municipal bonds

Corporate bonds

Equity securities

$ (1,180,000 )

Money Markets

$ (1,313,000 )

Money Markets and CDs

Investments at

April 30, 2020

Municipal bonds

1 unchanged sentence

Equity securities

Money Markets

securities that are classified as equity securities are carried at fair value on the balance sheets with changes in fair value

recorded as an unrealized gain or (loss) in the statements of income in the period of the change.

Upon the disposition of a marketable

security, the Company records a realized gain or (loss) on the Company’s statements of income.

On May 1, 2018, as a result

of the adoption of ASU 2016-01 –

Financial Instruments, the Company reclassified $2,424,000 of net unrealized gains on marketable

securities, that were formerly classified as available-for-sale equity securities before the adoption of the new standard, from

Accumulated Other Comprehensive Income to Retained Earnings.

Company evaluates all investments for other-than temporary declines in fair value, which are defined as when the cost basis exceeds

the fair value for approximately one year.

The Company also evaluates the nature of the investment, cause of impairment and number

of investments that are in an unrealized position.

When other than a temporary decline is identified, the Company will decrease

the cost of the investment to the new fair value and recognize a loss.

The investments are periodically evaluated to determine

if impairment changes are required.

As a result of this standard, management recorded impairment losses of $157,000 for the year

ended April 30, 2020 and $68,000 for the year ended April 30, 2019.

$ (1,180,000 )

Money Markets and CDs

$ (1,313,000 )

securities that are classified as equity securities are carried at fair value on the balance sheets with changes in fair value recorded

as an unrealized gain or (loss) in the statements of income in the period of the change.

Upon the disposition of a marketable security,

the Company records a realized gain or (loss) on the Company’s statements of income.

Company evaluates all investments for other-than temporary declines in fair value, which are defined as when the cost basis exceeds the

fair value for approximately one year.

The Company also evaluates the nature of the investment, cause of impairment and number of investments

that are in an unrealized position.

When other than a temporary decline is identified, the Company will decrease the cost of the investment

to the new fair value and recognize a loss.

The investments are periodically evaluated to determine if impairment changes are required.

As a result of this standard, management recorded impairment losses of $79,000 for the year ended April 30, 2021 and $157,000 for the

year ended April 30, 2020.

Company’s investments are actively traded in the stock and bond markets.

Therefore, there is either a realized gain or loss

that is recorded when a sale happens.

For the fiscal year ended April 30, 2020 the Company had sales of equity securities which

yielded gross realized gains of $374,000 and gross realized losses of $608,000.

For the same period, sales of debt securities

yielded gross realized gains of $4,000 and gross realized losses of $154,000.

Therefore, there is either a realized gain or loss that

is recorded when a sale happens.

For the fiscal year ended April 30, 2021 the Company had sales of equity securities which yielded gross

realized gains of $666,000 and gross realized losses of $290,000.

For the same period, there were not any sales of debt securities for

gross realized gains, but sales of debt securities yielded gross realized losses of $13,000.

Conversely, the Company recorded gross realized

gains on equity securities of $374,000 and gross realized losses of $608,000 for the fiscal year ending April 30, 2020.

debt securities, gross realized gains were $20,000 and gross realized losses were $258,000 for the fiscal year ending April 30,

The gross realized loss numbers include the impaired figures listed in the previous paragraph.

Additionally, proceeds from

sales of securities available for sale were $776,000 for the fiscal year ended April 30, 2020 and were $766,000 for the prior

following table shows the investments with unrealized losses that are not deemed to be other-than-temporarily impaired, aggregated

by investment category and length of time that individual securities have been in a continuous unrealized loss position, at April

30, 2020 and 2019.

As for debt securities,

gross realized gains were $4,000 and gross realized losses were $154,000 for the fiscal year ending April 30, 2020.

The gross realized

loss numbers include the impaired figures listed in the previous paragraph.

Additionally, proceeds from sales of securities available

for sale were $21,000 for the fiscal year ended April 30, 2021 and were $776,000 for the prior fiscal year.

Investments, continued

following table shows the investments with unrealized losses that are not deemed to be other-than-temporarily impaired, aggregated by

investment category and length of time that individual securities have been in a continuous unrealized loss position, at April 30, 2021

Loss Breakdown by Investment Type at April 30, 2021

than 12 months

Less than 12 months

12 months or greater

Unrealized Loss

Municipal bonds

Equity securities

$ (1,180,000 )

$ (1,313,000 )

Loss Breakdown by Investment Type at April 30, 2020

than 12 months

Less than 12 months

12 months or greater

Unrealized Loss

Municipal bonds

Equity securities

unrealized losses on the Company’s investments in municipal bonds were caused by interest rate increases.

The contractual

terms of these investments do not permit the issuer to settle the securities at a price less than the amortized cost of the investment.

Because the Company has the ability to hold these investments until a recovery of fair value occurs, which may be maturity, the

Company does not consider these investments to be other-than-temporarily impaired at April 30, 2020.

The contractual terms

of these investments do not permit the issuer to settle the securities at a price less than the amortized cost of the investment.

the Company has the ability to hold these investments until a recovery of fair value occurs, which may be maturity, the Company does

not consider these investments to be other-than-temporarily impaired at April 30, 2021.

Equity Securities and REITs

Company’s investments in marketable equity securities and REITs consist of a wide variety of companies.

Investments in these

companies include growth, growth income, and foreign investment objectives.

Management has evaluated the individual holdings and

does not consider these investments to be other-than-temporarily impaired at April 30, 2020.

Investments in these companies

include growth, growth income, and foreign investment objectives.

Management has evaluated the individual holdings and does not consider

these investments to be other-than-temporarily impaired at April 30, 2021.

Retirement Benefit Plan

January 1, 1998, the Company adopted the George Risk Industries, Inc.

Retirement Savings Plan (the “Plan”).

is a defined contribution savings plan designed to provide retirement income to eligible employees of the Company.

intended to be qualified under Section 401(k) of the Internal Revenue Code of 1986, as amended.

It is funded by voluntary pre-tax

and Roth (taxable) contributions from eligible employees who may contribute a percentage of their eligible compensation, limited

and subject to statutory limits.

Employees are eligible to participate in the Plan when they have attained the age of 21 and completed

one thousand hours of service in any plan year with the Company.

Upon leaving the Company, each participant is 100% vested with

respect to the participants’

contributions while the Company’s matching contributions are vested over a six-year period

in accordance with the Plan document.

Contributions are invested, as directed by the participant, in investment funds available

under the Plan.

Matching contributions of approximately $40,000 and $10,000 were paid in each of the fiscal years ending April

30, 2020 and 2019 respectively.

The Plan is a

defined contribution savings plan designed to provide retirement income to eligible employees of the Company.

The Plan is intended to

be qualified under Section 401(k) of the Internal Revenue Code of 1986, as amended.

It is funded by voluntary pre-tax and Roth (taxable)

contributions from eligible employees who may contribute a percentage of their eligible compensation, limited and subject to statutory

Employees are eligible to participate in the Plan when they have attained the age of 21 and completed one thousand hours of service

in any plan year with the Company.

Upon leaving the Company, each participant is 100% vested with respect to the participants’

contributions while the Company’s matching contributions are vested over a six-year period in accordance with the Plan document.

Contributions are invested, as directed by the participant, in investment funds available under the Plan.

Matching contributions of approximately

$61,000 and $40,000 were paid in each of the fiscal years ending April 30, 2021 and 2020 respectively.

Stockholders’

Stock —Each share of the Series #1 preferred stock is convertible at the option of the holder into five shares of Class

A common stock and is also redeemable at the option of the board of directors at $20 per share.

The holders of the convertible

preferred stock shall be entitled to a dividend at a rate up to $1 per share annually, payable quarterly as declared by the board

of directors.

No dividends were declared or paid during the two years ended April 30, 2020 and 2019.

Stock —Each share of the Series #1 preferred stock is convertible at the option of the holder into five shares of Class A common

stock and is also redeemable at the option of the board of directors at $20 per share.

The holders of the convertible preferred stock

shall be entitled to a dividend at a rate up to $1 per share annually, payable quarterly as declared by the board of directors.

were declared or paid during the two years ended April 30, 2021 and 2020.

preferred stock without par value may be issued from time to time as determined by the board of directors.

Shares of different

series shall be of equal rank but may vary as to terms and conditions.

A Common Stock —The holders of the Class A common stock are entitled to receive dividends as declared by the board of

Shares of different series

shall be of equal rank but may vary as to terms and conditions.

A Common Stock —The holders of the Class A common stock are entitled to receive dividends as declared by the board of directors.

No dividends may be paid on the Class A common stock until the holders of the Series #1 preferred stock have been paid.

A dividend for the four prior quarters and provision has been made for the full dividend in the current fiscal year.

A dividend for

the four prior quarters and provision has been made for the full dividend in the current fiscal year.

the fiscal year ended April 30, 2021, the Company purchased 3,458 shares of Class A common stock.

3 unchanged sentences

The Company maintains all stock records.

Earnings Per Share

and diluted earnings per share, assuming convertible preferred stock was converted for each period presented are:

April 30, 2021

(Denominator)

Effect of dilutive Convertible Preferred

Effect of dilutive Convertible Preferred Stock

April 30, 2020

(Denominator)

Effect of dilutive Convertible Preferred

Contingencies, and Related Party Transactions

Effect of dilutive Convertible Preferred Stock

Commitments, Contingencies, and Related Party Transactions

Company leased a building from Bonita Risk until the Company purchased the building from her in November 2019 for $200,000.

Risk is a majority stockholder, a director and employee of the Company.

This building contains the Company’s sales and accounting

departments, maintenance department, engineering department and some production facilities.

This lease required a minimum payment

of $1,535 on a month-to-month basis.

The total lease expense for this arrangement per year was $7,675 and $18,420 for the fiscal

years ended April 30, 2020 and 2019, respectively.

is a majority stockholder, a director and employee of the Company.

This building contains the Company’s sales and accounting departments,

maintenance department, engineering department and some production facilities.

This lease required a minimum payment of $1,535 on a month-to-month

The total lease expense for this arrangement per year was $0 and $7,675 for the fiscal years ended April 30, 2021 and 2020, respectively.

of the directors of the board, Joel Wiens, is the principal shareholder of FirsTier Bank.

1 unchanged sentence

the Company uses for its day to day banking operations.

Year end balances of accounts held at this bank are $5,167,000 for the

year ended April 30, 2020 and $4,224,000 for the year ended April 30, 2019.

The Company also received interest income from FirsTier

Bank in the amount of approximately $74,600 for the year ended April 30, 2020 and $63,400 for the year ended April 30, 2019.

Year end balances of accounts held at this bank are $6,885,000 for the year ended

April 30, 2021 and $5,167,000 for the year ended April 30, 2020.

The Company also received interest income from FirsTier Bank in the

amount of approximately $54,800 for the year ended April 30, 2021 and $74,600 for the year ended April 30, 2020.

time to time, the Company may be involved in litigation in the ordinary course of business.

The Company is not currently involved in

any litigation that we believe could have a material adverse effect on its financial condition or results of operations.

world has been impacted by the spread of the coronavirus (COVID-19) since early 2020.

It has created significant economic uncertainty

and volatility.

The extent to which the coronavirus pandemic impacts our business, operations and financial results will depend on numerous

evolving factors that we may not be able to accurately predict, including:

the duration and scope of the pandemic;

governmental, business

and individuals’

actions that have been and continue to be taken in response to the pandemic;

the impact of the pandemic on economic

activity and actions taken in response;

the effect on our clients and client demand for our services and solutions;

our ability to sell

and provide our services and solutions, including as a result of travel restrictions and people working from home;

the ability of our

clients to pay for our services and solutions;

and any closures of our and our clients’

offices and facilities.

Any of these events

could materially adversely affect our business, financial condition, results of operations and/or stock price.

Company has been able to continue to operate through the pandemic.

The health and safety of our employees and their families remains

our top priority.

Therefore, we have implemented many Centers of Disease Control protocols to keep our employees safe while the Company

continues to produce products and provide service to our customers.

While we are operating in a rapidly changing environment, the Company

has experienced delays in receiving raw material supplies in a timely manner.

Company utilizes the liability method of accounting for income taxes.

The liability method measures the expected income tax impact of

future income and deductions implicit in the Balance Sheets.

The income tax provision for the fiscal year ended April 30, 2021 and 2020

consisted of the following:

Year Ended April 30,

Total income tax provision

Reconciliation

of income taxes with Federal and State taxable income:

Income before income

Income before income taxes

State income tax deduction

Interest and dividend income

Nondeductible expenses and timing

Nondeductible expenses and timing differences

Taxable income

following schedule reconciles the provision for income taxes to the amount computed by applying the statutory rate to income before

income taxes:

Income tax provision

at statutory rate

Increase (decrease) income taxes

resulting from:

dividend income

following schedule reconciles the provision for income taxes to the amount computed by applying the statutory rate to income before income

Income tax provision at statutory rate

Increase (decrease) income taxes resulting from:

State income taxes

Interest and dividend income

Deferred taxes

Other temporary

and permanent differences

Other temporary and permanent differences

Income tax expense

1 unchanged sentence

State tax rate

Blended statutory

tax assets (liabilities) consist of the following components at April 30, 2020 and 2019:

Blended statutory rate

Deferred tax assets (liabilities) consist of the following components at April 30, 2021 and 2020:

Deferred tax assets (liabilities):

Inventory valuation

Allowance for

doubtful accounts

Allowance for doubtful accounts

Accrued vacation

Accumulated unrealized

(gain)/loss on investments

tax assets (liabilities)

Accumulated unrealized (gain)/loss on investments

Net deferred tax assets (liabilities)

$ (2,735,000 )

Federal tax rate

State tax rate

Blended statutory rate

Business Segments

following is financial information relating to industry segments:

Quarter ended

alarm products

Cable & wiring

Security alarm products

Cable & wiring tools

Other products

Total net revenue

Income from operations:

Security alarm

Cable & wiring

from operations

Security alarm products

Cable & wiring tools

Other products

Total income from operations

Depreciation and amortization:

Security alarm

Cable & wiring

Security alarm products

Cable & wiring tools

Other products

Total depreciation

and amortization

Corporate general

Total depreciation and amortization

Capital expenditures:

Security alarm

Cable & wiring

Security alarm products

Cable & wiring tools

Other products

Total capital

Corporate general

Total capital expenditures

April 30, 2021

April 30, 2020

Identifiable assets:

alarm products

Cable & wiring

Security alarm products

Cable & wiring tools

Other products

2 unchanged sentences

Company maintains the majority of its cash balance in a financial institution in Kimball, Nebraska.

Accounts at this institution

are insured by the Federal Deposit Insurance Corporation for up to $250,000.

For the years ended April 30, 2020 and 2019, the

Company had uninsured balances of $4,940,000, and $4,082,000, respectively.

Management believes that this financial institution

is financially sound and the risk of loss is minimal.

also has cash funds with Wells Fargo Bank with uninsured balances of $1,041,000 and $399,000 for the years ending April 30, 2020

and 2019, respectively.

Accounts at this institution are

insured by the Federal Deposit Insurance Corporation for up to $250,000.

For the years ended April 30, 2021 and 2020, the Company had

uninsured balances of $6,773,000, and $4,940,000, respectively.

Management believes that this financial institution is financially sound

and the risk of loss is minimal.

also has cash funds with Wells Fargo Bank with uninsured balances of $190,000 and $1,041,000 for the years ending April 30, 2021 and

2020, respectively.

Management believes that this financial institution is financially sound and the risk of loss is minimal.

Company has sales to a security alarm distributor representing 40% of total sales for the year ended April 30, 2020 and 41% of

total sales for the year ended April 30, 2019.

This distributor accounted for 54% and 61% of accounts receivable at April 30,

2020 and 2019, respectively.

switch sales made up 81% of total sales for the fiscal year ended April 30, 2020 and 78% of total sales for the fiscal year ended

April 30, 2019.

Value Measurements

carrying value of the Company’s cash and cash equivalents, accounts receivable and accounts payable approximate their fair

value due to their short term nature.

Company has sales to a security alarm distributor representing 40% of total sales for the year ended April 30, 2021 and 40% of total

sales for the year ended April 30, 2020.

This distributor accounted for 55% and 54% of accounts receivable at April 30, 2021 and 2020,

respectively.

switch sales made up 85% of total sales for the fiscal year ended April 30, 2021 and 81% of total sales for the fiscal year ended April

Fair Value Measurements

carrying value of the Company’s cash and cash equivalents, accounts receivable and accounts payable approximate their fair value

due to their short-term nature.

The fair value of our investments is determined utilizing market-based information.

value is the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between

market participants at the measurement date.

When determining the fair value measurements for assets and liabilities, which are

required to be recorded at fair value, we consider the principal or most advantageous market in which we would transact and the

market-based risk measurements or assumptions that market participants would use in pricing the asset or liability, such as inherent

risk, transfer restrictions, and credit risk.

Fair value is the

price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants

at the measurement date.

When determining the fair value measurements for assets and liabilities, which are required to be recorded at

fair value, we consider the principal or most advantageous market in which we would transact and the market-based risk measurements or

assumptions that market participants would use in pricing the asset or liability, such as inherent risk, transfer restrictions, and credit

GAAP establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value.

The hierarchy

gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (level 1 measurements)

and the lowest priority to unobservable inputs (level 3 measurements).

The levels of the fair value hierarchy under US GAAP are

described below:

gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (level 1 measurements) and

the lowest priority to unobservable inputs (level 3 measurements).

The levels of the fair value hierarchy under US GAAP are described

is based upon quoted prices for identical instruments traded in active markets.

is based upon quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments

in markets that are not active, and model-based valuation techniques for which all significant assumptions are observable

in the market.

is based upon quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets

that are not active, and model-based valuation techniques for which all significant assumptions are observable in the market.

is generated from model-based techniques that use significant assumptions not observable in the market.

These unobservable

assumptions reflect our own estimates of assumptions that market participants would use in pricing the asset or liability.

Valuation techniques include use of option pricing models, discounted cash flow models and similar techniques.

These unobservable assumptions

reflect our own estimates of assumptions that market participants would use in pricing the asset or liability.

Valuation techniques

include use of option pricing models, discounted cash flow models and similar techniques.

Value Measurements, continued

and Marketable Securities

of April 30, 2020, The Company’s investments consisted of money markets, publicly traded equity securities, REITs as well

as certain state and municipal debt securities and corporate bonds.

The marketable securities are valued using third-party broker

The value of the majority of securities is derived from quoted market information.

The inputs to the valuation are

classified as Level 1 given the active market for these securities;

however, if an active market does not exist, which is the

case for municipal bonds and REITs;

of April 30, 2021, The Company’s investments consisted of money markets, publicly traded equity securities, REITs as well as certain

state and municipal bonds.

The marketable securities are valued using third-party broker statements.

The value of the majority of securities

is derived from quoted market information.

The inputs to the valuation are classified as Level 1 given the active market for these securities;

however, if an active market does not exist, which is the case for municipal bonds and REITs;

the inputs are recorded as Level 2.

Value Hierarchy

following tables set forth our assets and liabilities measured at fair value on a recurring basis and a non-recurring basis by

level within the fair value hierarchy.

As required by US GAAP, assets and liabilities are classified in their entirety based on

the lowest level of input that is significant to the fair value measurement.

Measured at Fair Value on a Recurring

as of April 30, 2020

Corporate Bonds

following tables set forth our assets and liabilities measured at fair value on a recurring basis and a non-recurring basis by level

within the fair value hierarchy.

As required by US GAAP, assets and liabilities are classified in their entirety based on the lowest

level of input that is significant to the fair value measurement.

Assets Measured at Fair Value on a Recurring

Basis as of April 30, 2021

Municipal Bonds

Equity Securities

Money Markets and CDs

Total fair value of assets measured

on a recurring basis

Measured at Fair Value on a Recurring

Total fair value of assets measured on a recurring basis

Assets Measured at Fair Value on a Recurring

Basis as of April 30, 2020

Municipal Bonds

Corporate Bonds

1 unchanged sentence

Money Markets and CDs

Total fair value of assets measured

on a recurring basis

April 15, 2020, the Company received loan proceeds of approximately $950,000 (the “PPP Loan”) from FirsTier Bank,

pursuant to the Paycheck Protection Program (the “PPP”) under Division A, Title I of the CARES Act, which was enacted

March 27, 2020.

The PPP Loan, which was in the form of a Note dated April 15, 2020 issued to the Company, matures on April 15,

2022 and bears interest at a rate of 1% per annum, payable monthly commencing on November 15, 2020.

The Note may be prepaid by

the Company at any time prior to maturity with no prepayment penalties.

Funds from the PPP Loan may only be used for payroll costs,

costs used to continue group health care benefits, mortgage payments, rent, utilities, and interest on certain other debt obligations.

The Company intends to use the entire PPP Loan amount for qualifying expenses.

Under the terms of the PPP, certain amounts of

the PPP Loan may be forgiven if they are used for qualifying expenses as described in the CARES Act.

Total fair value of assets measured on a recurring basis

Paycheck Protection Program Loan

April 15, 2020, the Company received loan proceeds of approximately $950,000 (the “PPP Loan”) from FirsTier Bank, pursuant

to the Paycheck Protection Program under Division A, Title I of the CARES Act, which was enacted March 27, 2020.

The PPP Loan, which

was in the form of a Note dated April 15, 2020 issued to the Company, matures on April 15, 2022 and bears interest at a rate of 1% per

The Company used the proceeds of the PPP Loan for qualifying expenses.

On December 3, 2020, the Company received notice from the

lender that the entire amount of the PPP loan was forgiven.

In January 2021 it was determined that PPP loan forgiveness was not taxable.

The loan forgiveness amount is included in the “Other”

line of the Other Income (Expense) section of the income statement.

9 Disagreements on Accounting and Financial Disclosures

1 unchanged sentence

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 8. Financial Statements and Supplementary Data