Basis of Presentation (Notes) |
12 Months Ended |
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Mar. 31, 2021 | |
| Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
| Basis of Presentation | Basis of Presentation: Description of Business
Westell Technologies, Inc. (the “Company”) is a holding company. Its wholly owned subsidiary, Westell, Inc., designs and distributes telecommunications products, which are sold primarily to major telephone companies.
COVID-19 Impact
In March 2020, the World Health Organization declared the spread of a new strain of coronavirus (“COVID-19”) a pandemic, as COVID-19 spread throughout the U.S. and around the world. The COVID-19 pandemic has impacted and may continue to negatively impact the global economy, disrupt global supply chains and work force participation while creating significant disruption and volatility of financial markets. The COVID-19 pandemic has adversely impacted and may continue to adversely affect the Company’s sales, supply chain availability and sourcing costs, workforce and operations, as well as, those of its customers, contract manufacturers and other supply chain partners.
Contract Manufacturing Facility Fire
In February 2021, a small fire at a subcontractor destroyed inventory that was being used to produce some of Westell’s IBW and ISM products, including those that were previously produced under a product license agreement (see Note 7). The loss of the inventory caused delays in delivering products and a decision to accelerate engineering efforts to develop a new replacement product. Insurance policies are expected to cover the replacement value of the assets that incurred losses or damages, less a $50,000 deductible. As a result of the fire, the Company recorded an insurance recovery receivable, which is presented in Prepaid expenses and other assets in the Consolidated Balance Sheet, to cover the net book value of the inventory and fixed assets damaged in the fire. If the agreed upon insurance settlement exceeds the book value, a gain on the insurance settlement will be recorded in the period such gain is realized.
Principles of Consolidation
The accompanying Consolidated Financial Statements include the accounts of the Company and its majority owned subsidiaries. The Consolidated Financial Statements have been prepared using accounting principles generally accepted in the United States (GAAP). All intercompany accounts and transactions have been eliminated in consolidation.
Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and that affect revenue and expenses during the periods reported. Estimates are used when accounting for the allowance for uncollectible accounts receivable, net realizable value of inventory, product warranty accrued, relative stand-alone selling prices, stock-based compensation, and intangible assets fair value, depreciation, income taxes, and contingencies, among other things. The Company bases its estimates on historical experience and on other assumptions that its management believes are reasonable under the circumstances. Actual results could differ from those estimates.
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