EEI 2017 Form 10-K

Table of Contents Allowance for Doubtful Accounts and Contract Adjustments Activity within the allowance for doubtful accounts and contract adjustments is summarized in the following table. Fiscal Year Ended July 31, 2017 2016 2015 (in thousands) Balance at beginning of period $ 6,792 $ 6,817 $ 7,371 Net increase (decrease) due to adjustments in the allowance for: Contract adjustments (1) (4,941) (577) (263) Doubtful accounts (2) 274 552 (291) Balance at end of period $ 2,125 $ 6,792 $ 6,817 (1) Increases (decreases) to the allowance for contract adjustments on the consolidated balance sheets are recorded as (decreases) increases to revenue on the consolidated statements of operations. During fiscal year 2017, the Company reversed $4.9 million of allowance related to a specific project in the Middle East, for which a corresponding $4.9 million contract receivable balance was also written off during the period. (2) Increases (decreases) to the allowance for doubtful accounts on the consolidated balance sheets are recorded as increases (decreases) to administrative and other indirect operating expenses on the consolidated statements of operations. During fiscal year 2017, the South American economies continue to adversely impact some of our local clients. Management is monitoring any adverse trends or events that may impact the realizability of the recorded net book value of contract receivables from our South American clients. 8. Property, Buildings and Equipment, net Property, buildings and equipment is summarized in the following table. Balance at July 31, 2017 2016 (in thousands) Land and land improvements $ 393 $ 393 Buildings and building improvements 7,338 9,700 Field equipment 2,267 2,222 Computer equipment 4,339 4,439 Computer software 3,107 3,105 Office furniture and equipment 2,264 2,683 Vehicles 1,331 1,333 Other 383 543 21,422 24,418 Accumulated depreciation and amortization (16,994) (18,324) Property, buildings and equipment, net $ 4,428 $ 6,094 During fiscal year 2017, the Company consummated the sale of land, a vacant building, related building improvements and fixtures, and warehouse space to a non-affiliated third party for approximately $1.5 million. After closing costs, the Company recorded a gain on sale of $0.1 million from this transaction in other (expense) income in the consolidated statements of income during fiscal year 2017. 9. Goodwill Goodwill of $1.1 million is included in other assets on the accompanying consolidated balance sheets at July 31, 2017 and 2016. The Company’s most recent annual impairment assessment for goodwill was completed at July 31, 2017. Based on this assessment, the fair values of the reporting units to which goodwill is assigned exceeded the book values of the respective reporting units. As a result, no impairment of goodwill was identified. 49