Note 6: Fixed Assets

Fixed assets consisted of the following at August 31, 2020 and 2019:

Depreciation and amortization expense for the years ended August 31, 2020 and 2019, was $272,000 and $194,000, respectively.

Software consists primarily of customized software purchased from third party providers, which is incorporated into the Company’s HRIS platform and related mobile application.

Information related to capitalized software costs is as follows:

The Company has evaluated certain development costs of its software solution in accordance with ASC Topic 350‑40, Internal Use Software, which outlines the stages of computer software development and specifies when capitalization of costs is required. Projects that are determined to be in the development stage are capitalized and amortized over their useful lives of five years. Projects that are determined to be within the preliminary stage are expensed as incurred. For the years ended August 31, 2020 and 2019, no internally developed software was capitalized. A substantial portion of the capitalized software is attributable to a third party with whom the Company is in litigation. During Fiscal 2020, the Company evaluated its capital software costs in the context of the procedural status and progress of the Kadima litigation.  Based on this evaluation, and the Company’s estimate of the timeline for the resolution of this matter, the Company determined the capital software costs related to certain of the applications not in use became impaired.