Other Balance Sheet Components
|12 Months Ended|
Sep. 30, 2023
|Other Balance Sheet Components||OTHER BALANCE SHEET COMPONENTS
Accounts Receivable, Net
On September 21, 2022, we entered into a Receivables Purchase Agreement with Wells Fargo Bank N.A., under which we may sell certain US-originated accounts receivable balances up to a maximum amount of $200.0 million. In return for these sales, we receive a cash payment equal to the face value of the receivables less a financing charge.
We account for these transfers as sales. We have no retained interest in the transferred receivables other than administrative responsibilities, and Wells Fargo has no recourse for any credit risk. We estimate that the implicit servicing fees for an arrangement of this size and type would be immaterial.
For the years ended September 30, 2023 and 2022, the fair value of accounts receivables transferred to Wells Fargo and derecognized from our balance sheet was $450.4 million and $74.2 million, respectively. In exchange for these sales, we received cash of $447.7 million and $73.9 million for the same periods, respectively. The balance, representing a loss on sale from these transfers, is included within our selling, general, and administrative expenses. We have recorded these transactions within our operating cash flows.
Property and Equipment, Net
Depreciation expense for the years ended September 30, 2023, 2022, and 2021, was $28.4 million, $28.3 million, and $34.1 million, respectively. This expense was recorded within "cost of revenue" and "selling, general, and administrative expenses" on our consolidated statements of operations.
In August 2022, we sold the land and buildings that held our corporate headquarters, resulting in a gain on sale of $11.0 million.
Capitalized Software Costs, Net
Capitalized software is recorded at cost and includes purchased, internally-developed, and externally-developed software used in our operations. Amortization expense is provided using the straight-line method over the estimated useful lives of the software.
A summary of activities related to capitalized software costs is shown below:
Amortization expense related to capitalized software for the years ended September 30, 2023, 2022, and 2021 was $26.3 million, $14.1 million, and $12.3 million, respectively. The majority of this amortization was recorded within our "cost of revenue" and "selling, general, and administrative expenses" on our consolidated statements of operations.
Deferred Contract Costs, Net
Deferred contract costs consist of contractually recoverable costs to fulfill related to long-term service contracts. These costs include direct and incremental costs incurred prior to the commencement of providing service to our customer. These costs are expensed over the period the services are provided using the straight-line method.
A summary of activities related to deferred contract costs is shown below:
Amortization expense related to deferred contract costs for the years ended September 30, 2023, 2022, and 2021 was $12.7 million, $8.9 million, and $13.6 million, respectively. These amounts were recorded within our "cost of revenue" on our consolidated statements of operations.
Accumulated Other Comprehensive Income
All amounts recorded in accumulated other comprehensive loss are related to our foreign currency translations and interest rate swap, net of tax. The following table shows changes in accumulated other comprehensive loss.
The entire disclosure for accounts receivable, contract receivable, receivable held-for-sale, and nontrade receivable.
Reference 1: http://www.xbrl.org/2003/role/disclosureRef