Annual report pursuant to Section 13 and 15(d)

Balance sheet components

v3.19.3
Balance sheet components
 12 Months Ended
Sep. 30, 2019
Balance Sheet Related Disclosures [Abstract]  
Balance sheet components Balance sheet components
Property and equipment
Property and equipment, at cost, consists of the following (in thousands):
  As of September 30,
  2019 2018
Land $ 1,738    $ 1,738   
Building and improvements 12,044    12,044   
Office furniture and equipment 246,671    203,512   
Leasehold improvements 69,183    55,918   
329,636    273,212   
Less: Accumulated depreciation and amortization (230,047)   (195,668)  
Total property and equipment, net $ 99,589    $ 77,544   
Depreciation expense for the years ended September 30, 2019, 2018 and 2017 was $45.2 million, $40.7 million and $45.2 million, respectively.
Capitalized software
Capitalized software consists of the following (in thousands):
  As of September 30,
  2019 2018
Capitalized software $ 103,643    $ 94,803   
Less: Accumulated amortization (71,274)   (72,374)  
Total capitalized software, net $ 32,369    $ 22,429   
Amortization expense for the years ended September 30, 2019, 2018 and 2017 was $7.2 million, $11.2 million and $10.6 million, respectively. Most of this amortization was recorded within our "cost of revenue" on our consolidated statements of operations.
Deferred contract costs
For many contracts, we incur significant incremental costs at the beginning of an arrangement. Typically, these costs relate to the establishment of infrastructure which we utilize to satisfy our performance obligations with the contract. We report these costs as deferred contract costs and amortize them on a straight-line basis over the shorter of the useful economic life of the asset or the anticipated term of the contract.
Deferred contract costs consist of the following (in thousands):
  As of September 30,
  2019 2018
Deferred contract costs $ 43,140    $ 29,941   
Less: Accumulated amortization (24,219)   (15,561)  
Total deferred contract costs, net $ 18,921    $ 14,380   

Since September 30, 2018, we have deferred $14.5 million of costs. During the year ended September 30, 2019, we amortized $9.9 million of deferred contract costs. This amortization was recorded within our "cost of revenue" on our consolidated statements of operations.
The totals above include $3.7 million of costs which were deferred and subsequently written off during the year ended September 30, 2019. These costs related to a contract within our U.S. Health and Human Services Segment which is no longer able to recover the deferred costs. This expense was recorded within "cost of revenue" on our consolidated statements of operations.