UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 10-Q

(Mark One)

☒QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterquarterly period ended JanuaryOctober 31, 2021

☐TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

[  ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ______________ to ________________

Commission File Number: 000-05378

GEORGE RISK INDUSTRIES, INC.

(Exact name of registrant as specified in its charter)

Colorado84-0524756
(State or other jurisdiction of incorporation)
incorporation or organization)		(IRSI.R.S. Employers
Identification No.)

802 S.South Elm St., Kimball, NE69145
Kimball, NE69145
(Address of principal executive offices)(Zip Code)

(308)235-4645

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each classTrading Symbol(s)Name of each exchange on which registered
Class A Common Stock, $0.10 par valueRSKIAOTC Markets
Convertible Preferred Stock, $20 stated valueRSKIAOTC Markets

Indicate by check mark whether the registrant (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act of 1934 during the precedingpast 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.Yes ☒ No ☐

Yes [X] No [  ]

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405(&232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).Yes ☒ No ☐

Yes [X] No [  ]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smallersmall reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer [  ]☐Accelerated filer [  ]☐
Non-accelerated filer [  ] ☐Smaller reporting company [X]☒
Emerging growth company [  ]☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. [  ]☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).Yes ☐ No ☒

Yes [  ] No [X]

APPLICABLE ONLY TO CORPORATE ISSUERS:ISSUERS

The number of shares of the Registrant’s Common Stock outstanding, as of March 17,December 15, 2021 was 4,946,902.4,943,856.

 

 
 

GEORGE RISK INDUSTRIES, INC.

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

The unaudited financial statements for the three- and nine-month periodthree-and six-month periods ended JanuaryOctober 31, 2021, are attached hereto.

GEORGE RISK INDUSTRIES, INC.
CONDENSED BALANCE SHEETS
       
  January 31, 2021  April 30, 2020 
  (unaudited)    
ASSETS        
         
Current Assets:        
Cash and cash equivalents $6,936,000  $6,458,000 
Investments and securities  30,880,000   25,322,000 
Accounts receivable:        
Trade, net of $6,858 and $7,306 doubtful account allowance  3,340,000   2,964,000 
Other  42,000   18,000 
Income tax overpayment  —   56,000 
Inventories, net  5,901,000   5,103,000 
Prepaid expenses  160,000   516,000 
Total Current Assets  47,259,000   40,437,000 
         
Property and Equipment, net  1,686,000   1,465,000 
         
Other Assets        
Investment in Limited Land Partnership, at cost  320,000   320,000 
Projects in process  51,000   21,000 
Other  1,000   2,000 
Total Other Assets  372,000   343,000 
         
Intangible Assets, net  1,425,000   1,517,000 
         
TOTAL ASSETS $50,742,000  $43,762,000 

2

GEORGE RISK INDUSTRIES, INC.

CONDENSED BALANCE SHEETS

  October 31, 2021  April 30, 2021 
  (unaudited)    
ASSETS        
         
Current Assets:        
Cash and cash equivalents $6,107,000  $7,326,000 
Investments and securities  34,409,000   33,337,000 
Accounts receivable:        
Trade, net of $20,343 and $9,947 doubtful account allowance  3,617,000   3,812,000 
Other  18,000   16,000 
Inventories, net  7,077,000   5,622,000 
Prepaid expenses  561,000   405,000 
Total Current Assets  51,789,000   50,518,000 
         
Property and Equipment, net, at cost  1,593,000   1,704,000 
         
Other Assets        
Investment in Limited Land Partnership, at cost  344,000   320,000 
Projects in process  341,000   200,000 
Other  40,000   — 
Total Other Assets  725,000   520,000 
         
Intangible Assets, net  1,332,000   1,394,000 
         
TOTAL ASSETS $55,439,000  $54,136,000 

See accompanying notes to the unaudited condensed financial statements.

GEORGE RISK INDUSTRIES, INC.
CONDENSED BALANCE SHEETS
(continued)
       
  January 31, 2021  April 30, 2020 
  (unaudited)    
       
LIABILITIES AND STOCKHOLDERS’ EQUITY        
         
Current Liabilities        
Accounts payable, trade $498,000  $187,000 
Dividends payable  2,080,000   1,892,000 
Accrued expenses  504,000   450,000 
Income tax payable  193,000   — 
Notes payable  —   950,000 
Total Current Liabilities  3,275,000   3,479,000 
         
Long-Term Liabilities        
Deferred income taxes  2,058,000   699,000 
Total Long-Term Liabilities  2,058,000   699,000 
         
Total Liabilities  5,333,000   4,178,000 
         
Commitments and Contingencies  —   — 
         
Stockholders’ Equity        
Convertible preferred stock, 1,000,000 shares authorized, Series 1—noncumulative, $20 stated value, 25,000 shares  authorized, 4,100 issued and outstanding  99,000   99,000 
Common stock, Class A, $.10 par value, 10,000,000 shares authorized, 8,502,881 shares issued and outstanding  850,000   850,000 
Additional paid-in capital  1,934,000   1,934,000 
Accumulated other comprehensive income  129,000   (4,000)
Retained earnings  46,726,000   41,006,000 
Less: treasury stock, 3,555,779 and 3,552,954 shares, at cost  (4,329,000)  (4,301,000)
Total Stockholders’ Equity  45,409,000   39,584,000 
         
TOTAL LIABILITES AND STOCKHOLDERS’ EQUITY $50,742,000  $43,762,000 

3

GEORGE RISK INDUSTRIES, INC.

CONDENSED BALANCE SHEETS

(continued)

  October 31, 2021  April 30, 2021 
  (unaudited)    
LIABILITIES AND STOCKHOLDERS’ EQUITY        
         
Current Liabilities        
Accounts payable, trade $294,000  $477,000 
Dividends payable  2,297,000   2,080,000 
Accrued expenses:        
Payroll and other expense  355,000   359,000 
Income tax payable  220,000   81,000 
Total Current Liabilities  3,166,000   2,997,000 
         
Long-Term Liabilities        
Deferred income taxes  2,969,000   2,735,000 
Total Long-Term Liabilities  2,969,000   2,735,000 
         
Total Liabilities  6,135,000   5,732,000 
         
Commitments and Contingencies  —   — 
         
Stockholders’ Equity        
Convertible preferred stock, 1,000,000 shares authorized, Series 1—noncumulative, $20 stated value, 25,000 shares authorized, 4,100 issued and outstanding  99,000   99,000 
Common stock, Class A, $.10 par value, 10,000,000 shares authorized, 8,502,881 shares issued and outstanding  850,000   850,000 
Additional paid-in capital  1,934,000   1,934,000 
Accumulated other comprehensive income  72,000   108,000 
Retained earnings  50,711,000   49,749,000 
Less: treasury stock, 3,558,425 and 3,556,412 shares, at cost  (4,362,000)  (4,336,000)
Total Stockholders’ Equity  49,304,000   48,404,000 
         
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY $55,439,000  $54,136,000 

See accompanying notes to the unaudited condensed financial statements

GEORGE RISK INDUSTRIES, INC.
CONDENSED INCOME STATEMENTS
FOR THE THREE AND NINE MONTHS ENDED JANUARY 31, 2021 AND 2020
(Unaudited)
             
  Three months  Three months  Nine months  Nine months 
  ended  ended  ended  ended 
  Jan 31, 2021  Jan 31, 2020  Jan 31, 2021  Jan 31, 2020 
Net Sales $4,633,000  $3,589,000  $13,327,000  $10,852,000 
Less: Cost of Goods Sold  (2,385,000)  (1,832,000)  (6,631,000)  (5,462,000)
Gross Profit  2,248,000   1,757,000   6,696,000   5,390,000 
                 
Operating Expenses                
General and Administrative  362,000   302,000   1,040,000   928,000 
Sales  639,000   587,000   1,809,000   1,698,000 
Engineering  31,000   34,000   81,000   66,000 
Rent Paid to Related Parties  —   —   —   8,000 
Total Operating Expenses  1,032,000   923,000   2,930,000   2,700,000 
                 
Income From Operations  1,216,000   834,000   3,766,000   2,690,000 
                 
Other Income                
Other  952,000   —   1,008,000   2,000 
Dividend and Interest Income  317,000   423,000   608,000   782,000 
Unrealized Gain on equity securities  2,654,000   508,000   4,653,000   782,000 
Gain on Investments  250,000   78,000   293,000   137,000 
Gain on Sale of Assets  —   5,000   4,000   5,000 
Total Other Income  4,173,000   1,014,000   6,566,000   1,708,000 
                 
Income Before Provisions for Income Taxes  5,389,000   1,848,000   10,332,000   4,398,000 
                 
Provisions for Income Taxes:                
Current Expense  199,000   359,000   1,230,000   911,000 
Deferred Tax Expense (Benefit)  743,000   125,000   1,303,000   191,000 
Total Income Tax Expense  942,000   484,000   2,533,000   1,102,000 
                 
Net Income $4,447.000  $1,364,000  $7,799,000  $3,296,000 
                 
Income Per Share of Common Stock                
Basic $0.90  $0.28  $1.58  $0.67 
Diluted $0.89  $0.27  $1.57  $0.66 
                 
Weighted Average Number of Common Shares Outstanding                
Basic  4,948,224   4,950,524   4,949,351   4,953,008 
Diluted  4,968,724   4,971,024   4,969,851   4,973,508 

4

GEORGE RISK INDUSTRIES, INC.

CONDENSED INCOME STATEMENTS

FOR THE THREE AND SIX MONTHS ENDED OCTOBER 31, 2021 AND 2020

(Unaudited)

  Three months  Three months  Six months  Six months 
  ended  ended  ended  ended 
  Oct 31, 2021  Oct 31, 2020  Oct 31, 2021  Oct 31, 2020 
Net Sales $5,244,000  $4,647,000  $10,199,000  $8,694,000 
Less: Cost of Goods Sold  (2,729,000)  (2,294,000)  (5,047,000)  (4,245,000)
Gross Profit  2,515,000   2,353,000   5,152,000   4,449,000 
                 
Operating Expenses                
General and Administrative  350,000   364,000   699,000   678,000 
Sales  720,000   604,000   1,460,000   1,171,000 
Engineering  21,000   21,000   39,000   50,000 
Total Operating Expenses  1,091,000   989,000   2,198,000   1,899,000 
                 
Income From Operations  1,424,000   1,364,000   2,954,000   2,550,000 
                 
Other Income (Expense)                
Other  13,000   44,000   13,000   56,000 
Dividend and Interest Income  148,000   134,000   324,000   290,000 
Unrealized Gain (Loss) on Equity Securities  623,000   (115,000)  1,043,000   1,999,000 
Gain on Investments  79,000   72,000   300,000   44,000 
Gain on Sale of Assets  —   4,000   —   4,000 
Total Other Income  863,000   139,000   1,680,000   2,393,000 
                 
Income Before Provisions for Income Taxes  2,287,000   1,503,000   4,634,000   4,943,000 
                 
Provisions for Income Taxes:                
Current Expense  454,000   682,000   952,000   1,032,000 
Deferred Tax (Benefit) Expense  145,000   (39,000)  248,000   559,000 
Total Income Tax Expense  599,000   643,000   1,200,000   1,591,000 
                 
Net Income $1,688,000  $860,000  $3,434,000  $3,352,000 
                 
Income Per Share of Common Stock                
Basic $0.34  $0.17  $0.69  $0.68 
Diluted $0.34  $0.17  $0.69  $0.67 
                 
Weighted Average Number of Common Shares Outstanding                
Basic  4,945,130   4,949,902   4,945,795   4,949,914 
Diluted  4,965,630   4,970,402   4,966,295   4,970,414 

See accompanying notes to the unaudited condensed financial statements

5

GEORGE RISK INDUSTRIES, INC.

CONDENSED STATEMENTSTATEMENTS OF COMPREHENSIVE INCOME

FOR THE THREE AND NINESIX MONTHS ENDED JANUARY 31.OCTOBER 31, 2021 AND 2020

(Unaudited)

  Three months  Three months  Nine months  Nine months 
  ended  ended  ended  ended 
  Jan 31, 2021  Jan 31, 2020  Jan 31, 2021  Jan 31, 2020 
Net Income $4,447,000  $1,364,000  $7,799,000  $3,296,000 
                 
Other Comprehensive Income, Net of Tax                
Unrealized gain on debt securities:                
Unrealized holding gains arising during period  59,000   27,000   189,000   77,000 
Income tax (expense) related to other comprehensive income  (17,000)  (8,000)  (56,000)  (22,000)
                 
Other Comprehensive Income  42,000   19,000   133,000   55,000 
                 
Comprehensive Income $4,489,000  $1,383,000  $7,932,000  $3,351,000 

  Three months  Three months  Six months  Six months 
  ended  ended  ended  ended 
  Oct 31, 2021  Oct 31, 2020  Oct 31, 2021  Oct 31, 2020 
Net Income $1,688,000  $860,000  $3,434,000  $3,352,000 
                 
Other Comprehensive Income, Net of Tax                
Unrealized gain (loss) on debt securities:                
Unrealized holding gains (losses) arising during period  (61,000)  (20,000)  (50,000)  130,000 
Income tax benefit (expense) related to other comprehensive income  18,000   6,000   14,000   (39,000)
Other Comprehensive Income (Loss)  (43,000)  (14,000)  (36,000)  91,000 
                 
Comprehensive Income $1,645,000  $846,000  $3,398,000  $3,443,000 

See accompanying notes to the unaudited condensed financial statements

GEORGE RISK INDUSTRIES, INC.
CONDENSED STATEMENTS OF STOCKHOLDERS’ EQUITY
FOR THE THREE MONTHS ENDED JANUARY 31, 2021 AND 2020
(Unaudited)
 
  Preferred Stock  

Common Stock

Class A

 
  Shares  Amount  Shares  Amount 
Balances, October 31, 2020  4,100  $99,000   8,502,881  $850,000 
                 
Purchases of Common Stock  —   —   —   — 
                 
Unrealized gain, net of tax effect  —   —   —   — 
                 
Net Income  —   —   —   — 
                 
Balances, January 31, 2021  4,100  $99,000   8,502,881  $850,000 

  Preferred Stock  

Common Stock

Class A

 
  Shares  Amount  Shares  Amount 
Balances, October 31, 2019  4,100  $99,000   8,502,881  $850,000 
                 
Purchases of common stock  —   —   —   — 
                 
Unrealized gain, net of tax effect  —   —   —   — 
                 
Net Income  —   —   —   — 
                 
Balances, January 31, 2020  4,100  $99,000   8,502,881  $850,000 

6

GEORGE RISK INDUSTRIES, INC.

CONDENSED STATEMENTS OF STOCKHOLDERS’ EQUITY

FOR THE THREE MONTHS ENDED OCTOBER 31, 2021 AND 2020

(Unaudited)

  Shares  Amount  Shares  Amount 
  Preferred Stock  

Common Stock

Class A

 
  Shares  Amount  Shares  Amount 
Balances, July 31, 2020  4,100  $99,000   8,502,881  $850,000 
                 
Purchases of common stock  —   —   —   — 
                 
Dividend declared at $0.42 per common share outstanding  —   —   —   — 
                 
Unrealized gain (loss), net of tax effect  —   —   —   — 
                 
Net Income  —   —   —   — 
                 
Balances, October 31, 2020  4,100  $99,000   8,502,881  $850,000 

  Preferred Stock  

Common Stock

Class A

 
  Shares  Amount  Shares  Amount 
Balances, July 31, 2021  4,100  $99,000   8,502,881  $850,000 
                 
Purchases of common stock  —   —   —   — 
                 
Dividend declared at $0.50 per common share outstanding                
                 
Unrealized gain (loss), net of tax effect  —   —   —   — 
                 
Net Income  —   —   —   — 
                 
Balances, October 31, 2021  4,100  $99,000   8,502,881  $850,000 

See accompanying notes to the unaudited condensed financial statements

GEORGE RISK INDUSTRIES, INC. 
CONDENSED STATEMENTS OF STOCKHOLDERS’ EQUITY 
FOR THE THREE MONTHS ENDED JANUARY 31, 2021 AND 2020
(Unaudited)		 
  
Paid-In  

Treasury Stock

(Common Class A)

  

Accumulated

Other

Comprehensive

  Retained    
Capital  Shares  Amount  Income  Earnings  Total 
$1,934,000   3,553,029  $(4,302,000) $87,000  $42,279,000  $40,947,000 
                       
 —   2,750   (27,000)  —   —   (27,000)
                       
 —   —   —   42,000   —   42,000 
                       
 —   —   —   —   4,447,000   4,447,000 
                       
$1,934,000   3,555,779  $(4,329,000) $129,000  $46,726,000  $45,409,000 

Paid-In  

Treasury Stock

(Common Class A)

  

Accumulated

Other

Comprehensive

  Retained    
Capital  Shares  Amount  Income  Earnings  Total 
$1,934,000   3,550,771  $(4,281,000) $50,000  $40,834,000  $39,486,000 
                       
 —   1,850   (17,000)  —   —   (17,000)
                       
 —   —   —   19,000   —   19,000 
                       
 —   —   —   —   1,364,000   1,364,000 
                       
$1,934,000   3,552,621  $(4,297,000) $69,000  $42,198,000  $40,852,000 

7

GEORGE RISK INDUSTRIES, INC.

CONDENSED STATEMENTS OF STOCKHOLDERS’ EQUITY

FOR THE THREE MONTHS ENDED OCTOBER 31, 2021 AND 2020

(Unaudited)

 Capital  Shares  Amount  Income  Earnings  Total 
 Paid-In  

Treasury Stock

(Common Class A)

  Accumulated Other Comprehensive  Retained    
 Capital  Shares  Amount  Income  Earnings  Total 
Balances, July 31, 2020$1,934,000   3,552,954  $(4,301,000) $101,000  $43,498,000  $42,181,000 
                        
Purchases of common stock —   75   (1,000)  —   —   (1,000)
                        
Dividend declared at $0.42 per common share outstanding —   —   —   —   (2,079,000)  (2,079,000)
                        
Unrealized gain (loss), net of tax effect —   —   —   (14,000)  —   (14,000)
                        
Net Income —   —   —   —   860,000   860,000 
                        
Balances, October 31, 2020$1,934,000   3,553,029  $(4,302,000) $87,000  $42,279,000  $40,947,000 

 Paid-In  

Treasury Stock

(Common Class A)

  Accumulated Other Comprehensive  Retained    
 Capital  Shares  Amount  Income  Earnings  Total 
Balances, July 31, 2021$1,934,000   3,556,425  $(4,336,000) $115,000  $51,495,000  $50,157,000 
                        
Purchases of common stock —   2,000   (26,000)  —   —   (26,000)
                        
Dividend declared at $0.50 per common share outstanding —   —   —   —   (2,472,000)  (2,472,000)
                        
Unrealized gain (loss), net of tax effect —   —   —   (43,000)  —   (43,000)
                        
Net Income —   —   —   —   1,688,000   1,688,000 
                        
Balances, October 31, 2021$1,934,000   3,558,425  $(4,362,000) $72,000  $50,711,000  $49,304,000 

See accompanying notes to the unaudited condensed financial statements

GEORGE RISK INDUSTRIES, INC.
CONDENSED STATEMENTS OF STOCKHOLDERS’ EQUITY
FOR THE NINE MONTHS ENDED JANUARY 31, 2021 AND 2020
(Unaudited)
 
  Preferred Stock  

Common Stock

Class A

 
  Shares  Amount  Shares  Amount 
Balances, April 30, 2020  4,100  $99,000   8,502,881  $850,000 
                 
Purchases of common stock  —   —   —   — 
                 
Dividend declared at $0.42 per common share outstanding  —   —   —   — 
                 
Unrealized gain, net of tax effect  —   —   —   — 
                 
Net Income  —   —   —   — 
                 
Balances, January 31, 2021  4,100  $99,000   8,502,881  $850,000 

  Preferred Stock  

Common Stock

Class A

 
  Shares  Amount  Shares  Amount 
Balances, April 30, 2019  4,100  $99,000   8,502,881  $850,000 
                 
Purchases of common stock  —   —   —   — 
                 
Dividend declared at $0.40 per common share outstanding                
                 
Unrealized (loss), net of tax effect  —   —   —   — 
                 
Net Income  —   —   —   — 
                 
Balances, January 31, 2020  4,100  $99,000   8,502,881  $850,000 

8

GEORGE RISK INDUSTRIES, INC.

CONDENSED STATEMENTS OF STOCKHOLDERS’ EQUITY

FOR THE SIX MONTHS ENDED OCTOBER 31, 2021 AND 2020

(Unaudited)

  Shares  Amount  Shares  Amount 
  Preferred Stock  

Common Stock

Class A

 
  Shares  Amount  Shares  Amount 
Balances, April 30, 2020  4,100  $99,000   8,502,881  $850,000 
                 
Purchases of common stock  —   —   —   — 
                 
Dividend declared at $0.42 per common share outstanding  —   —   —   — 
                 
Unrealized gain (loss), net of tax effect  —   —   —   — 
                 
Net Income  —   —   —   — 
                 
Balances, October 31, 2020  4,100  $99,000   8,502,881  $850,000 

  Preferred Stock  

Common Stock

Class A

 
  Shares  Amount  Shares  Amount 
Balances, April 30, 2021  4,100  $99,000   8,502,881  $850,000 
                 
Purchases of common stock  —   —   —   — 
                 
Dividend declared at $0.50 per common share outstanding                
                 
Unrealized gain (loss), net of tax effect  —   —   —   — 
                 
Net Income  —   —   —   — 
                 
Balances, October 31, 2021  4,100  $99,000   8,502,881  $850,000 

See accompanying notes to the unaudited condensed financial statements

GEORGE RISK INDUSTRIES, INC. 
CONDENSED STATEMENTS OF STOCKHOLDERS’ EQUITY 
FOR THE NINE MONTHS ENDED JANUARY 31, 2021 AND 2020
(Unaudited)		 
  
Paid-In  

Treasury Stock

(Common Class A)

  

Accumulated

Other

Comprehensive

  Retained    
Capital  Shares  Amount  Income  Earnings  Total 
$1,934,000   3,552,954  $(4,301,000) $(4,000) $41,006,000  $39,584,000 
                       
 —   2,825   (28,000)  —   —   (28,000)
                       
 —   —   —   —   (2,079,000)  (2,079,000)
                       
 —   —   —   133,000   —   134,000 
                       
 —   —   —   —   7,799,000   7,799,000 
                       
$1,934,000   3,555,779  $(4,329,000) $129,000  $46,726,000  $45,409,000 

Paid-In  

Treasury Stock

(Common Class A)

  

Accumulated

Other

Comprehensive

  Retained    
Capital  Shares  Amount  Income  Earnings  Total 
$1,934,000   3,544,271  $(4,227,000) $14,000  $40,883,000  $39,553,000 
                       
 —   8,350   (71,000)  —   —   (71,000)
                       
 —   —   —   —   (1,981,000)  (1,981,000)
                       
 —   —   —   55,000   —   55,000 
                       
 —   —   —   —   3,296,000   3,296,000 
                       
$1,934,000   3,552,621  $(4,298,000) $69,000  $42,198,000  $40,852,000 

9

GEORGE RISK INDUSTRIES, INC.

CONDENSED STATEMENTS OF STOCKHOLDERS’ EQUITY

FOR THE SIX MONTHS ENDED OCTOBER 31, 2021 AND 2020

(Unaudited)

 Capital  Shares  Amount  Income  Earnings  Total 
 

Paid-In

  

Treasury Stock

(Common Class A)

  

Accumulated

Other

Comprehensive

  Retained    
 Capital  Shares  Amount  Income  Earnings  Total 
Balances, April 30, 2020$1,934,000   3,552,954  $(4,301,000) $(4,000) $41,006,000  $39,584,000 
                        
Purchases of common stock —   75   (1,000)  —   —   (1,000)
                        
Dividend declared at $0.42 per common share outstanding —   —   —   —   (2,079,000)  (2,079,000)
                        
Unrealized gain (loss), net of tax effect —   —   —   91,000   —   91,000 
                        
Net Income —   —   —   —   3,352,000   3,352,000 
                        
Balances, October 31, 2020$1,934,000   3,553,029  $(4,302,000) $87,000  $42,279,000  $40,947,000 

 Paid-In  

Treasury Stock

(Common Class A)

  

Accumulated

Other

Comprehensive

  Retained    
 Capital  Shares  Amount  Income  Earnings  Total 
Beginning balance$1,934,000   3,556,412  $(4,336,000) $108,000  $49,749,000  $48,404,000 
                        
Purchases of common stock —   2,013   (26,000)  —   —   (26,000)
                        
Dividend declared —   —   —   —   (2,472,000)  (2,472,000)
                        
Unrealized gain (loss), net of tax effect —   —   —   (36,000)  —   (36,000)
                        
Net Income —   —   —   —   3,434,000   3,434,000 
                        
Ending balance$1,934,000   3,558,425  $(4,362,000) $72,000  $50,711,000  $49,304,000 

See accompanying notes to the unaudited condensed financial statements

GEORGE RISK INDUSTRIES, INC.
CONDENSED STATEMENT OF CASH FLOWS
FOR THE NINE MONTHS ENDED JANUARY 31,2021 AND 2020
(Unaudited)
       
  Jan 31, 2021  Jan 31, 2020 
CASH FLOWS FROM OPERATING ACTIVITIES:        
Net Income $7,799,000  $3,296,000 
Adjustments to reconcile net income to net cash provided by operating activities:        
Depreciation and amortization  297,000   276,000 
(Gain) on sale of investments  (372,000)  (178,000)
Impairments on investments  79,000   41,000 
Unrealized (gain) on equity investments  (4,653,000)  (782,000)
Reserve for bad debts  —   (6,000)
Reserve for obsolete inventory  25,000   42,000 
Deferred income taxes  1,303,000   191,000 
PPP loan debt forgiveness  (950,000)  — 
(Gain) on sale of assets  (4,000)  (5,000)
Net book value of assets retired  —   (17,000)
Changes in assets and liabilities:        
(Increase) decrease in:        
Accounts receivable  (376,000)  460,000 
Inventories  (823,000)  (506,000)
Prepaid expenses  327,000   43,000 
Other receivables  (24,000)  2,000 
Income tax overpayment  —   142,000 
Increase (decrease) in:        
Accounts payable  311,000   16,000 
Accrued expenses  54,000   — 
Income tax payable  249,000   — 
Net cash from operating activities  3,242,000   3,015,000 
         
CASH FLOWS FROM INVESTING ACTIVITIES:        
Proceeds from sale of assets  4,000   7,000 
(Purchase) of property and equipment  (426,000)  (468,000)
Proceeds from sale of marketable securities  18,000   760,000 
(Purchase) of marketable securities  (440,000)  (640,000)
(Purchase) of long-term investment  —   (27,000)
Net cash from investing activities  (844,000)  (368,000)
CASH FLOWS FROM FINANCING ACTIVITIES:        
(Purchase) of treasury stock  (28,000)  (71,000)
Dividends paid  (1,892,000)  (1,802,000)
Net cash from financing activities  (1,920,000)  (1,873,000)
         
NET CHANGE IN CASH AND CASH EQUIVALENTS  478,000   774,000 
         
Cash and Cash Equivalents, beginning of period  6,458,000   4,873,000 
Cash and Cash Equivalents, end of period $6,936,000  $5,647,000 
         
Supplemental Disclosure for Cash Flow Information:        
Cash payments for:        
Income taxes $975,000  $870,000 
Interest paid $—  $— 
Cash receipts for:        
Income taxes $—  $159,000 

10

GEORGE RISK INDUSTRIES, INC.

CONDENSED STATEMENTS OF CASH FLOWS

FOR THE SIX MONTHS ENDED OCTOBER 31, 2021 AND 2020

(Unaudited)

  Oct 31, 2021  Oct 31, 2020 
CASH FLOWS FROM OPERATING ACTIVITIES:        
Net Income $3,434,000  $3,352,000 
Adjustments to reconcile net income to net cash provided by operating activities:        
Depreciation and amortization  213,000   189,000 
(Gain) on sale of investments  (300,000)  (123,000)
Impairments on investments  —   79,000 
Unrealized (gain) on equity securities  (1,043,000)  (1,999,000)
Reserve for bad debts  10,000   (6,000)
Reserve for obsolete inventory  73,000   10,000 
Deferred income taxes  248,000��  559,000 
(Gain) loss on sale of assets  —   (4,000)
Changes in assets and liabilities:        
(Increase) decrease in:        
Accounts receivable  185,000   32,000 
Inventories  (1,528,000)  (637,000)
Prepaid expenses and projects in process  (337,000)  73,000 
Other receivables  (2,000)  (10,000)
Increase (decrease) in:        
Accounts payable  (183,000)  28,000 
Accrued expenses  (4,000)  (104,000)
Income tax payable  140,000   376,000 
Net cash from operating activities  906,000   1,815,000 
         
CASH FLOWS FROM INVESTING ACTIVITIES:        
Proceeds from sale of assets  —   4,000 
(Purchase) of property and equipment  (40,000)  (361,000)
Proceeds from sale of marketable securities  428,000   16,000 
(Purchase) of marketable securities  (208,000)  (186,000)
(Purchase) of long-term investment  (24,000)  — 
Net cash from investing activities  156,000   (527,000)
         
CASH FLOWS FROM FINANCING ACTIVITIES:        
(Purchase) of treasury stock  (26,000)  (1,000)
Dividends paid  (2,255,000)  (1,890,000)
Net cash from financing activities  (2,281,000)  (1,891,000)
         
NET CHANGE IN CASH AND CASH EQUIVALENTS  (1,219,000)  (603,000)
         
Cash and Cash Equivalents, beginning of period  7,326,000   6,458,000 
Cash and Cash Equivalents, end of period $6,107,000  $5,855,000 
         
Supplemental Disclosure for Cash Flow Information:        
Cash payments for:        
Income taxes $860,000  $650,000 
Interest paid $—  $— 
         
Cash receipts for:        
Income taxes $43,000  $— 

See accompanying notes to the unaudited condensed financial statements

11

GEORGE RISK INDUSTRIES, INC.

NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS

JANUARYOCTOBER 31, 2021

Note 1:Unaudited Interim Financial Statements

Note 1 Unaudited Interim Financial Statements

The accompanying financial statements have been prepared in accordance with the instructions for Form 10-Q and do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. It is suggested that these unaudited condensed financial statements be read in conjunction with the financial statements and notes thereto included in the Company’s April 30, 20202021 annual report on Form 10-K. In the opinion of management, all adjustments, consisting only of normal recurring adjustments considered necessary for a fair presentation, have been included. Operating results for any quarter are not necessarily indicative of the results for any other quarter or for the full year.

Accounting Estimates—The preparation of these financial statements requires the use of estimates and assumptions including the carrying value of assets. The estimates and assumptions result in approximate rather than exact amounts.

Recently Issued Accounting Pronouncements —In June 2016 the FASB issued ASU No. 2016-13, “Financial Instruments –- Credit Losses (Topic 326),”(Topic 326): which was subsequently amended in February 2020 by ASU 2020-02, Measurement of“Financial Instruments - Credit Losses on Financial Instruments(Topic 326) and Leases (Topic 842).””, which requires entities to use a forward looking approach The amendments introduce an impairment model that is based on expected credit losses, rather than incurred losses, to estimate credit losses on certain types of financial instruments (e.g., loans and held-to-maturity securities), including trade receivables.certain off-balance sheet financial instruments (e.g., loan commitments). The FASB has subsequently issued updates toexpected credit losses should consider historical information, current information, and reasonable and supportable forecasts, including estimates of prepayments, over the standard to provide additional clarification on specific topics. Topic 326contractual term. Financial instruments with similar risk characteristics may be grouped together when estimating expected credit losses. The update with amendment is effective for fiscal years, and interim periods within those fiscal years beginning after December 15, 2019. We have applied this guidance, as of May 1, 2020, using a modified-retrospective approach. The application of this guidance did not require a cumulative effect adjustment to retained earnings and did not have a material effect on our financial statements.

In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement - Disclosure Framework (Topic 820). The updated guidance improves the disclosure requirements on fair value measurements. The updated guidance is effective for fiscal years, and2022, including interim periods within those fiscal years, beginning after December 15, 2019. Early adoption is permitted for any removed or modified disclosures. We appliedyears. The Company does not believe this new guidance as of May 1, 2020. The application of this guidance did notwill have a material effectimpact on our disclosures.its financial statements and will implement the disclosures related to this update beginning in 2023.

In January 2020, the FASB issued ASU 2020-01, “Investments - Equity Securities (Topic 321), Investments - Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815) - Clarifying the Interactions between Topic 321, Topic 323, and Topic 815.” The ASU is based on a consensus of the Emerging Issues Task Force and is expected to increase comparability in accounting for these transactions. ASU 2016-01 made targeted improvements to accounting for financial instruments, including providing an entity the ability to measure certain equity securities without a readily determinable fair value at cost, less any impairment, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer. Among other topics, the amendments clarify that an entity should consider observable transactions that require it to either apply or discontinue the equity method of accounting. For public business entities, the amendmentsASU 2020-01 deals with changes in the ASU aresignificant influence of derivative and investments, of which the Company has none and became effective for fiscal years beginning after December 15, 2020, and interim periods within those fiscal years. Early adoption is permitted.the Company in the first quarter of 2021. The Company does not expect the adoption of ASU 2020-01 tothis standard did not have a materialany impact on itsthe Company’s condensed financial statements.

There are no other new accounting pronouncements that are expected to have a significant impact on our financial statements.

Note 2:Investments12

Note 2 Investments

The Company has investments in publicly traded equity securities, state and municipal debt securities, real estate investment trusts, and money markets. The investments in debt securities, which include municipal bonds and bond funds, mature between April 2021June 2022 and January 2044. The Company uses the average cost method to determine the cost of equity securities sold with any unrealized gains or losses reported in the respective period’s earnings. Unrealized gains and losses on debt securities are excluded from earnings and reported separately as a component of stockholder’s equity. Dividend and interest income are reported as earned.

As of JanuaryOctober 31, 2021 and April 30, 2020,2021, investments consisted of the following:

Schedule of Investments

Investments at   Gross Gross   
October 31, 2021 Cost Unrealized Unrealized Fair 
   Gross Gross    Basis Gains Losses Value 
Investments at Cost Unrealized Unrealized Fair 
January 31, 2021 Basis Gains Losses Value 
Municipal bonds $5,748,000  $222,000  $(40,000) $5,930,000  $5,790,000  $155,000  $(51,000) $5,894,000 
REITs  131,000   1,000   (20,000)  112,000   131,000   15,000   (6,000)  140,000 
Equity securities  17,012,000   7,048,000   (155,000)  23,905,000   17,835,000   10,373,000   (114,000)  28,094,000 
Money markets and CDs  933,000   —   —   933,000   281,000   —   —   281,000 
Total $23,824,000  $7,271,000  $(215,000) $30,880,000  $24,037,000  $10,543,000  $(171,000) $34,409,000 

Investments at   Gross Gross   
April 30, 2021 Cost Unrealized Unrealized Fair 
   Gross Gross    Basis Gains Losses Value 
Investments at Cost Unrealized Unrealized Fair 
April 30, 2020 Basis Gains Losses Value 
Municipal bonds $5,271,000  $80,000  $(89,000) $5,262,000  $5,854,000  $198,000  $(43,000) $6,009,000 
Corporate bonds  26,000   —   —   26,000 
REITs  112,000   —   (44,000)  68,000   131,000   11,000   (5,000)  137,000 
Equity securities  17,119,000   3,446,000   (1,180,000)  19,385,000   17,199,000   9,294,000   (74,000)  26,419,000 
Money markets and CDs  581,000   —   —   581,000   772,000   —   —   772,000 
Total $23,109,000  $3,526,000  $(1,313,000) $25,322,000  $23,956,000  $9,503,000  $(122,000) $33,337,000 

Marketable securities that are classified as equity securities are carried at fair value on the balance sheets with changes in fair value recorded as an unrealized gain or (loss) in the statements of income in the period of the change. Upon the disposition of a marketable security, the Company records a realized gain or (loss) on the Company’s statements of income.

The Company evaluates all marketable securities for other-than-temporary declines in fair value, which are defined as when the cost basis exceeds the fair value for approximately one year. The Company also evaluates the nature of the investment, cause of impairment and number of investments that are in an unrealized position. When an “other-than-temporary” decline is identified, the Company will decrease the cost of the marketable security to the new fair value and recognize a real loss. The investments are periodically evaluated to determine if impairment changes are required. As a result of this standard, management did not need to record anthere were no impairment losslosses recorded for the quarter but recorded a loss of $79,000 forand the ninesix months ended JanuaryOctober 31, 2021. As for the corresponding periods last year, management did not need to recordrecorded an impairment loss of $52,000 for the quarter ended JanuaryOctober 31, 2020 but did recordand an impairment loss of $41,000$79,000 was recorded for the nine-monthssix-months ended JanuaryOctober 31, 2020.

13

The Company’s investments are actively traded in the stock and bond markets. Therefore, either a realized gain or loss is recorded when a sale happens. For the quarter ended JanuaryOctober 31, 2021 the Company had sales of equity securities which yielded gross realized gains of $288,000$106,000 and gross realized losses of $35,000.$26,000. For the same period, sales of debt securities did not0t yield any gross realized gains but gross realized losses of $3,000 were recorded.or losses. As for the nine-monthssix-months ended JanuaryOctober 31, 2021 the Company had sales of equity securities which yielded gross realized gains of $575,000$343,000 and gross realized losses of $272,000.$33,000. For the same nine-monthsix-month period, sales of debt securities did not0t yield any gross realized gains, but gross realized losses of $9,000$10,000 were recorded. During the quarter ending JanuaryOctober 31, 2020, the Company recorded gross realized gains and losses on equity securities of $97,000$184,000 and $17,000,$110,000, respectively, while sales of debt securities did not0t yield any gross realized gains, but gross realized losses of $2,000$2,000 were recorded. During the nine-monthssix-months ending JanuaryOctober 31, 2020, the Company recorded gross realized gains and losses on equity securities of $317,000$286,000 and $178,000,$236,000, respectively, as well aswhile sales of debt securities did 0t yield any gross realized gains, andbut gross realized losses on debt securities of $3,000 and $5,000, respectively.$6,000 were recorded. The gross realized loss numbers include the impaired figures listed in the previous paragraph.

The following tables showtable shows the investments with unrealized losses that are not deemed to be “other-than-temporarily impaired”, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, at JanuaryOctober 31, 2021 and April 30, 2020,2021, respectively.

Schedule of Unrealized Loss Breakdown by Investment

Unrealized Loss Breakdown by Investment Type at JanuaryOctober 31, 2021

Description Less than 12 months, Fair Value Less than 12 months, Unrealized Loss 12 months or greater, Fair Value 12 months or greater, Unrealized Loss Total, Fair Value Total, Unrealized Loss 
 Less than 12 months 12 months or greater Total  Less than 12 months 12 months or greater Total 
Description Fair Value Unrealized Loss Fair Value Unrealized Loss Fair Value Unrealized Loss  Fair Value Unrealized Loss Fair Value Unrealized Loss Fair Value Unrealized Loss 
Municipal bonds $192,000  $(1,000) $     299,000  $(39,000) $491,000  $(40,000) $699,000  $(17,000) $305,000  $(34,000) $1,004,000  $(51,000)
REITs  37,000   (8,000)  54,000   (13,000)  91,000   (21,000)  —   —   23,000   (6,000)  23,000   (6,000)
Equity securities  1,886,000   (91,000)  256,000   (63,000)  2,142,000   (154,000)  739,000   (61,000)  316,000   (53,000)  1,055,000   (114,000)
Total $2,115,000  $(100,000) $609,000  $(115,000) $2,724,000  $(215,000) $1,438,000  $(78,000) $644,000  $(93,000) $2,082,000  $(171,000)

Unrealized Loss Breakdown by Investment Type at April 30, 20202021

Description Less than 12 months, Fair Value Less than 12 months, Unrealized Loss 12 months or greater, Fair Value 12 months or greater, Unrealized Loss Total, Fair Value Total, Unrealized Loss 
 Less than 12 months 12 months or greater Total  Less than 12 months 12 months or greater Total 
Description Fair Value Unrealized Loss Fair Value Unrealized Loss Fair Value Unrealized Loss  Fair Value Unrealized Loss Fair Value Unrealized Loss Fair Value Unrealized Loss 
Municipal bonds $2,203,000  $(42,000) $484,000  $(47,000) $2,687,000  $(89,000) $390,000  $(6,000) $365,000  $(37,000) $755,000  $(43,000)
REITs  43,000   (30,000)  24,000   (14,000)  67,000   (44,000)  —   —   23,000   (5,000)  23,000   (5,000)
Equity securities  5,496,000   (866,000)  1,651,000   (314,000)  7,147,000   (1,180,000)  340,000   (35,000)  377,000   (39,000)  717,000   (74,000)
Total $7,742,000  $(938,000) $2,159,000  $(375,000) $9,901,000  $(1,313,000) $730,000  $(41,000) $765,000  $(81,000) $1,495,000  $(122,000)

 

Municipal Bonds

The unrealized losses on the Company’s investments in municipal bonds were caused by interest rate increases. The contractual terms of these investments do not permit the issuer to settle the securities at a price less than the amortized cost of the investment. Because the Company has the ability to hold these investments until a recovery of fair value, which may be maturity, the Company does not consider these investments to be other-than-temporarily impaired at JanuaryOctober 31, 2021.

Marketable Equity Securities and REITs

The Company’s investments in marketable equity securities and REITs consist of a wide variety of companies. Investments in these companies include growth, growth income, and foreign investment objectives. The individual holdings have been evaluated, and due to management’s plan to hold on to these investments for an extended period, the Company does not consider these investments to be other-than-temporarily impaired at JanuaryOctober 31, 2021.

Note 3:Inventories14

Note 3 Inventories

Inventories at JanuaryOctober 31, 2021 and April 30, 20202021 consisted of the following:

Schedule of Inventories

  January 31,  April 30, 
  2021  2020 
       
Raw materials $4,843,000  $4,233,000 
Work in process  491,000   402,000 
Finished goods  730,000   606,000 
   6,064,000   5,241,000 
Less: allowance for obsolete inventory  (163,000)  (138,000)
Inventories, net $5,901,000  $5,103,000 

  October 31,  April 30, 
  2021  2021 
       
Raw materials $5,703,000  $4,399,000 
Work in process  657,000   457,000 
Finished goods  965,000   768,000 
Inventory in transit  —   173,000 
Inventory gross  7,325,000   5,797,000 
Less: allowance for obsolete inventory  (248,000)  (175,000)
Inventories, net $7,077,000  $5,622,000 
Note 4:Business Segments

 

Note 4 Business Segments

The following is financial information relating to industry segments:

Schedule of Financial Information Relating to Industry Segments

 Three months Three months Nine months Nine months  Three months Three months Six months Six months 
 ended ended ended ended  ended ended ended ended 
 Jan 31, 2021 Jan 31, 2020 Jan 31, 2021 Jan 31, 2020  Oct 31, 2021 Oct 31, 2020 Oct 31, 2021 Oct 31, 2020 
Net revenue:                                
Security alarm products $3,876,000  $2,909,000  $11,039,000  $8,700,000  $4,546,000  $3,632,000  $8,803,000  $6,962,000 
Cable & wiring tools  551,000   547,000   1,596,000   1,680,000   518,000   620,000   1,056,000   1,019,000 
Other products  206,000   133,000   692,000   472,000   180,000   395,000   340,000   713,000 
Total net revenue $4,633,000  $3,589,000  $13,327,000  $10,852,000  $5,244,000  $4,647,000  $10,199,000  $8,694,000 
                                
Income from operations:                                
Security alarm products $1,008,000  $669,000  $3,119,000  $2,156,000  $1,229,000  $1,092,000  $2,550,000  $2,042,000 
Cable & wiring tools  145,000   129,000   451,000   417,000   147,000   160,000   306,000   299,000 
Other products  63,000   36,000   196,000   117,000   48,000   112,000   98,000   209,000 
Total income from operations $1,216,000  $834,000  $3,766,000  $2,690,000  $1,424,000  $1,364,000  $2,954,000  $2,550,000 
                                
Depreciation and amortization:                                
Security alarm products $37,000  $(22,000) $98,000  $72,000  $39,000  $39,000  $74,000  $61,000 
Cable & wiring tools  31,000   31,000   92,000   92,000   31,000   31,000   62,000   61,000 
Other products  19,000   34,000   47,000   50,000   19,000   14,000   42,000   27,000 
Corporate general  21,000   50,000   60,000   62,000   16,000   19,000   35,000   40,000 
Total depreciation and amortization $108,000  $93,000  $297,000  $276,000  $105,000  $103,000  $213,000  $189,000 
                                
Capital expenditures:                                
Security alarm products $65,000  $—  $307,000  $178.000  $—  $149,000  $40,000  $242,000 
Cable & wiring tools  —   —   —   —   —   —   —   — 
Other products  —   18,000   113,000   18,000   —   111,000   —   113,000 
Corporate general  —   272,000   6,000   272,000   —   6,000   —   6,000 
Total capital expenditures $65,000  $290,000  $426,000  $468,000  $—  $266,000  $40,000  $361,000 

 January 31, 2021 April 30, 2020  October 31, 2021 April 30, 2021 
Identifiable assets:                
Security alarm products $8,555,000  $7,150,000  $10,169,000  $8,955,000 
Cable & wiring tools  2,627,000   2,684,000   2,439,000   2,534,000 
Other products  777,000   724,000   666,000   667,000 
Corporate general  38,783,000   33,204,000   42,165,000   41,980,000 
Total assets $50,742,000  $43,762,000  $55,439,000  $54,136,000 

15
Note 5:Earnings per Share

Note 5 Earnings per Share

Basic and diluted earnings per share, assuming convertible preferred stock was converted for each period presented, are:

Schedule of Basic and Diluted Earnings per Share

 For the three months ended January 31, 2021  For the three months ended October 31, 2021 
 Income Shares Per-Share  Income Shares Per-Share 
 (Numerator)  (Denominator)  Amount  (Numerator)  (Denominator)  Amount 
Net income $4,447,000          $1,688,000         
Basic EPS $4,447,000   4,948,224  $.90  $1,688,000   4,945,130  $.34 
Effect of dilutive Convertible Preferred Stock  –   20,500   —   –   20,500   — 
Diluted EPS $4,447,000   4,968,724  $.89  $1,688,000   4,965,630  $.34 

 For the three months ended January 31, 2020  For the three months ended October 31, 2020 
 Income Shares Per-Share  Income Shares Per-Share 
 (Numerator)  (Denominator)  Amount  (Numerator)  (Denominator)  Amount 
Net income $1,364,000          $860,000         
Basic EPS $1,364,000   4,950,524  $.28  $860,000   4,949,902  $.17 
Effect of dilutive Convertible Preferred Stock  –   20,500   —   –   20,500   — 
Diluted EPS $1,364,000   4,971,024  $.27  $860,000   4,970,402  $.17 

 For the nine months ended January 31, 2021  For the six months ended October 31, 2021 
 Income Shares Per-Share  Income Shares Per-Share 
 (Numerator)  (Denominator)  Amount  (Numerator)  (Denominator)  Amount 
Net income $7,799,000          $3,434,000         
Basic EPS $7,799,000   4,949,351  $1.58  $3,434,000   4,945,795  $.69 
Effect of dilutive Convertible Preferred Stock  –   20,500   —   –   20,500   — 
Diluted EPS $7,799,000   4,969,851  $1.57  $3,434,000   4,966,295  $.69 

 For the nine months ended January 31, 2020  For the six months ended October 31, 2020 
 Income Shares Per-Share  Income Shares Per-Share 
 (Numerator)  (Denominator)  Amount  (Numerator)  (Denominator)  Amount 
Net income $3,296,000          $3,352,000         
Basic EPS $3,296,000   4,953,008  $.67  $3,352,000   4,949,914  $.68 
Effect of dilutive Convertible Preferred Stock  –   20,500   —   –   20,500   — 
Diluted EPS $3,296,000   4,973,508  $.66  $3,352,000   4,970,414  $.67 

16
Note 6:Retirement Benefit Plan

Note 6 Retirement Benefit Plan

On January 1, 1998, the Company adopted the George Risk Industries, Inc. Retirement Savings Plan (the “Plan”). The Plan is a defined contribution savings plan designed to provide retirement income to eligible employees of the Company. The Plan is intended to be qualified under Section 401(k) of the Internal Revenue Code of 1986, as amended. It is funded by voluntary pre-tax and Roth (taxable) contributions from eligible employees who may contribute a percentage of their eligible compensation, limited and subject to statutory limits. Employees are eligible to participate in the Plan when they have attained the age of 21 and completed one thousand hours of service in any plan year with the Company. Upon leaving the Company, each participant is 100%100% vested with respect to the participants’ contributions while the Company’s matching contributions are vested over a six-year period in accordance with the Plan document. Contributions are invested, as directed by the participant, in investment funds available under the Plan. Matching contributions by the Company of approximately $16,000$15,000 and $14,000$16,000 were paid during each quarter ending JanuaryOctober 31, 2021 and 2020, respectively. Likewise, the Company paid matching contributions of approximately $46,000$33,000 and $23,000$29,000 during each nine-monthsix-month period ending JanuaryOctober 31, 2021 and 2020, respectively.

Note 7:Fair Value Measurements

 

Generally accepted accounting principles inNote 7 Fair Value Measurements

The carrying value of the United States of America (US GAAP) definesCompany’s cash and cash equivalents, accounts receivable and accounts payable approximate their fair value asdue to their short-term nature. The fair value of our investments is determined utilizing market-based information. Fair value is the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities, which are required to be recorded at fair value, we consider the principal or most advantageous market in which we would transact and the market-based risk measurements or assumptions that market participants would use in pricing the asset or liability, such as inherent risk, transfer restrictions, and credit risk.

US GAAP establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (level 1 measurement) and the lowest priority to unobservable inputs (level 3 measurements). The levels of the fair value hierarchy under US GAAP are described below:

Level 1Valuation is based upon quoted prices for identical instruments traded in active markets.
Level 2Valuation is based upon quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-based valuation techniques for which all significant assumptions are observable in the market.
Level 3Valuation is generated from model-based techniques that use significant assumptions not observable in the market. These unobservable assumptions reflect our own estimates of assumptions that market participants would use in pricing the asset or liability. Valuation techniques include use of option pricing models, discounted cash flow models and similar techniques.

Investments and Marketable Securities

As of JanuaryOctober 31, 2021, our investments consisted of money markets, certificates of deposit, publicly traded equity securities, real estate investment trusts (REITs) as well as certain state and municipal debt securities and corporate bonds. Oursecurities. The marketable securities are valued using third-party broker statements. The value of the investmentsmajority of securities is derived from quoted market information. The inputs to the valuation are generally classified as Level 1 given the active market for these securities, however, if an active market does not exist, which is the case for municipal bonds and REITs, the inputs are recorded as Level 2.

Fair Value Hierarchy

The following tables settable sets forth our assets and liabilities measured at fair value on a recurring basis and a non-recurring basis by level within the fair value hierarchy. As required by US GAAP, assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement.

  Assets Measured at Fair Value on a Recurring Basis as of
January 31, 2021		 
  Level 1  Level 2  Level 3  Total 
Assets:            
Municipal Bonds $—  $5,930,000  $—  $5,930,000 
REITs  —   112,000   —   112,000 
Equity Securities  23,905,000   —   —   23,905,000 
Money Markets and CDs  933,000   —   —   933,000 
Total fair value of assets measured on a recurring basis $24,838,000  $6,042,000  $—  $30,880,000 

Schedule of Assets Measured at Fair Value on Recurring Basis

 Level 1 Level 2 Level 3 Total 
 Assets Measured at Fair Value on a Recurring Basis as of
April 30, 2020		  Assets Measured at Fair Value on a Recurring Basis as of
October 31, 2021		 
 Level 1 Level 2 Level 3 Total  Level 1 Level 2 Level 3 Total 
Assets:                         
Municipal Bonds $—  $5,262,000  $—  $5,262,000  $—  $5,894,000  $—  $5,894,000 
Corporate Bonds  26,000   —   —   26,000 
REITs  —   68,000   —   68,000   —   140,000   —   140,000 
Equity Securities  19,385,000   —   —   19,385,000   28,094,000   —   —   28,094,000 
Money Markets and CDs  581,000   —   —   581,000   281,000   —   —   281,000 
Total fair value of assets measured on a recurring basis $19,992,000  $5,330,000  $—  $25,322,000  $28,375,000  $6,034,000  $—  $34,409,000 

 Level 1  Level 2  Level 3  Total 
  Assets Measured at Fair Value on a Recurring Basis as of
April 30, 2021		 
  Level 1  Level 2  Level 3  Total 
Assets:                
 Municipal Bonds $—  $6,009,000  $—  $6,009,000 
 REITs  —   137,000   —   137,000 
 Equity Securities  26,419,000   —   —   26,419,000 
 Money Markets and CDs  772,000   —   —   772,000 
Total fair value of assets measured on a recurring basis $27,191,000  $6,146,000  $—  $33,337,000 

Note 8 Subsequent Events

None

Note 8Paycheck Protection Program Loan18

On April 15, 2020, the Company received loan proceeds of approximately $950,000 (the “PPP Loan”) from FirsTier Bank, pursuant to the Paycheck Protection Program under Division A, Title I of the CARES Act, which was enacted March 27, 2020. The PPP Loan, which was in the form of a Note dated April 15, 2020 issued to the Company, matures on April 15, 2022 and bears interest at a rate of 1% per annum. The Company used the proceeds of the PPP Loan for qualifying expenses. On December 3, 2020, the Company received notice from the lender that the entire amount of the PPP loan was forgiven. In January 2021 it was determined that PPP loan forgiveness was not taxable.

GEORGE RISK INDUSTRIES, INC.

PART I. FINANCIAL INFORMATION

Item 2. Management Discussion and Analysis of Financial Condition and Results of Operations

 

MANAGEMENT DISCUSSION AND ANALYSIS

OF FINANCIAL CONDITION

AND RESULTS OF OPERATIONS

This Quarterly Report on Form 10-Q, includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the Securities Act) and Section 21E of the Securities Exchange Act of 1934, as amended (the Exchange Act), which are subject to the “safe harbor” created by those sections. Any statements herein that are not statements of historical fact may be deemed to be forward-looking statements. For example, words such as “may,” “will,” “could,” “would,” “should,” “anticipate,” “expect,” “intend,” “believe,” “estimate,” “project” or “continue,” and the negatives of such terms are intended to identify forward-looking statements. The information included herein represents our estimates and assumptions as of the date of this filing. Unless required by law, we undertake no obligation to update publicly any forward-looking statements, or to update the reasons actual results could differ materially from those anticipated in these forward-looking statements, even if new information becomes available in the future.

 

The following discussion should be read in conjunction with the attached unaudited condensed financial statements, and with the Company’s audited financial statements and discussion for the fiscal year ended April 30, 2020.2021.

Executive Summary

The Company’s performance continues to improvegrow through the three quartersfirst half of the current fiscal year with the thirdsecond quarter staying strong. The Company is on track to haveshowing a record setting year for sales.slight decline over the first quarter of the current fiscal year. This is mainly due the closureinability to obtain all the raw materials that are needed to complete the manufacture of a competitor that got out of the security switch businessour products and keeping employees staffed at the end of calendar year 2019 and having the ability to continue to work through the COVID-19 pandemic.our locations. The state of Nebraska, where we are located, has kept businesses open duringrecently issued news that it has one of the pandemic.lowest unemployment rates in the country. Additionally, the Company’s products are traditionally tied to the housing market and with that market remaining strong, it in turn helps the Company’s sales growth.grow. Opportunities include keeping up with the business growth. One way we are doing this is bygrowth, finding ways to get our products out to our customers in a timelier manner, and to continue looking into more automation. We also continue to look at businesses that might be a good fit to purchase. We also have new products that haveare expected to hit the marketplace and a couple more that are scheduled to be introduced by the end of the fiscal year. Challenges in the coming months include continuing to get product out to customers in a timely manner and dealing with the COVID-19 pandemic restrictions. Possible COVID-19 challenges include, but are not limited to, price increases and/or delays in the supply chain, reduced sales, workforce interruptions, and economic conditions impacting the stock market. Management continues to work at keeping operations flowing as efficient as possible with the hopes of getting the facilities running leaner and more profitable than ever before.

Results of Operations

 ●Net sales were $4,633,000$5,244,000 for the quarter ended JanuaryOctober 31, 2021, which is a 29.09%12.85% increase from the corresponding quarter last year. Year-to-date net sales were $13,327,000$10,199,000 at JanuaryOctober 31, 2021, which is a 22.81%17.31% increase from the same period last year. The significant growthincreases in sales is dueare primarily a result of a competitor no longer selling competing products and having the ability to ourcontinue to work through the COVID-19 pandemic. Also, the ongoing commitment totowards outstanding customer service and our abilitycustomization of products are a few of the many reasons sales continue to customize products. The Company is also seeing continued growth since a major competitor closed its doors at the end of 2019.grow.

 ●
●Cost of goods sold was 51.48%52.04% of net sales for the quarter ended JanuaryOctober 31, 2021 and was 51.04%49.37% for the same quarter last year. Year-to-date cost of goods sold percentages were 49.76%49.49% for the current ninesix months and 50.33%48.83% for the corresponding ninesix months last year, which isyear. The current cost of goods sold percentages are right outside of Management’s goal of keeping labor and other manufacturing expenses at the target of less than 50% for both the quarter andbut reached that goal for year-to-date results. Management continues to work with and train employees forto work more efficient productionefficiently and strives to getthey also work at getting the best price for raw materials. Also, a significant wage increase went into effect for the company at the beginning of the second quarter of the current fiscal year.
 ●
●Operating expenses increased by $109,000were up $102,000 for the quarter as they increased by $230,000and were up $299,000 for the nine-monthssix-months ended JanuaryOctober 31, 2021 as compared to the corresponding periods last year. WhenBut when comparing percentages in relation to net sales, the operating expenses for the quarter ended JanuaryOctober 31, 2021 was 22.27%20.80% of net sales while it was 25.72%21.28% of net sales for the same quarter the prior year. For year-to-date numbers, operating expense were 21.99%21.55% and 24.88%21.84% of net sales for the ninesix months ended JanuaryOctober 31, 2021 and 2020, respectively. The Company has been able to keep the operating expenses at less than 30% of net sales for many years now; however, the actual dollar amount increase is due tobecause of increased commission amounts related to increased(since sales have increased) and additional labor costs related to hiring new employees andfor wage increases.
 
 ●Income from operations for the quarter ended JanuaryOctober 31, 2021 was $1,216,000,at $1,424,000, which is a 45.80%4.40% increase from the corresponding quarter last year, which had income from operations of $834,000.$1,364,000. Income from operations for the ninesix months ended JanuaryOctober 31, 2021 was $3,766,000,at $2,954,000, which is a 40.00%15.84% increase from the corresponding ninesix months last year, which had income from operations of $2,690,000.$2,550,000.
 
 ●Other income and expenses are up $3,159,000 when comparing the current quarter to the same quarter last year. Comparatively, there isthe prior year, with an increase of $4,858,000$724,000 in the current quarter. Conversely, other income and expenses forare down by $713,000 when comparing the year-to-date numbers. The majoritycurrent six-month period to the prior six-month period. Most of the activity in these accounts consists of investment interest, dividends, realizedreal gains or losses on sale of investments, and unrealized gains or losses on equity securities. The majority ofmain reason for the larger than normal increases are fromincrease in the current quarter as opposed to the decrease for the year-to-date numbers is the unrealized gains, whichgain and loss on equity securities. The Company is a reflectionat the mercy of the stock market performing well.when it comes to these figures and the COVID-19 pandemic influenced these numbers.
 
 ●Overall, net income for the quarter ended JanuaryOctober 31, 2021 was up $3,083,000,$828,000, or 226.03%96.28%, from the same quarter last year. Similarly, net income for the nine-monthsix-month period ended JanuaryOctober 31, 2021 was up $4,503,000,$82,000, or 136.62%2.45%, from the same period in the prior year.
 
 ●Earnings per common share for quarter ended JanuaryOctober 31, 2021 were $0.90$0.34 per share and $1.58$0.69 per share for the year-to-date numbers. EPS for the quarter and ninesix months ended JanuaryOctober 31, 2020 were $0.28$0.17 per share and $0.67$0.68 per share, respectively.

Liquidity and capital resources

Operating

 ●Net cash increased $478,000decreased $1,219,000 during the ninesix months ended JanuaryOctober 31, 2021 as compared to an increasea decrease of $774,000$603,000 during the corresponding period last year.

20

 ●
●Accounts receivable increased $376,000decreased $185,000 for the ninesix months ended JanuaryOctober 31, 2021 compared with a $460,000$32,000 decrease for the same period last year. The bigger current year increasedecrease is a result of improved sales partially offset by slowerwhile collections ofon accounts receivable. Multiple receipts were received afterreceivable have declined over the close of the reporting period.last year. An analysis of accounts receivable shows that there were only 3.65% that4.84% of the receivables were over 90 days at JanuaryOctober 31, 2021.2021, while only 0.27% were over 90 days for the same period last year.
 ●
●Inventories increased $823,000$1,528,000 during the current nine-monthsix-month period as compared to ana $637,000 increase of $506,000 last year. The largerbigger increase in the current year is primarily due to an increase in raw material and finished goods. The increase in raw material is a result of having enough supply of materialbeing prepared for the increase we have seen in sales. The increaseIn addition, the Company is keeping more inventory on hand to reduce the likelihood of running into a shortage on some major raw materials, as we have experienced in finished goods relates to the introduction of a new product, a high security switch. We expect these to be sold soon.past.
 
 ●Prepaid expenses saw a $327,000$337,000 increase for the current six months, primarily due to having more prepayments of raw materials. Lead times and costs have risen on raw materials, making it a challenge to obtain. The prior year six months showed a $73,000 decrease in prepaid expenses.
●Accounts payable shows a decrease for the current nine months, primarily due to inventory being delivered that had been paid for in advance. The prior nine months showed a $43,000 decrease in prepaid expenses.
●Accounts payablesix-month period of $183,000 while it shows a $311,000 increase for the current nine-month period ended January 31, 2021 compared to a $16,000an increase for the prior nine-month period.six-month periods of $28,000. The company strives to pay all invoices within terms, and the variance in increases is primarily due to the timing of receipt of products and payment of invoices, as well asCOVID-19 related personnel constraints at the end of the current reporting period.invoices.
 
 ●Accrued expenses increased $54,000decreased $4,000 for the current nine-monthsix-month period as compared to no changea $104,000 decrease for the nine-monthsix-month period ended JanuaryOctober 31, 2020. The difference in the amounts is primarily due to timing of payroll periods ending.issues.
 
 ●Income tax payable increased $249,000$140,000 for the current nine-monthsix-month period, compared to a decreasehaving an increase of $376,000 in income tax overpayment for the nine-monthssix-months ended JanuaryOctober 31, 2020. The current increase is largely due to having increased sales and income and not having large enough income tax estimates.estimates large enough.

Investing

 ●
Investing
●As for our investment activities, the Company spent approximately $426,000 on acquisitionspurchased $40,000 of property and equipment forduring the current nine-month period, insix-month period. In comparison, with$361,000 was spent on purchases of property and equipment during the corresponding ninesix months last year, where there was activity of $468,000.year.

 ●
●Additionally, theThe Company continues to purchase marketable securities, which include municipal bonds and quality stocks. During the nine-monthsix-month period ended JanuaryOctober 31, 2021 thethere was quite a bit of buy/sell activity in the investment accounts was high.accounts. Net cash spent on purchases of marketable securities for the nine-monthsix-month period ended JanuaryOctober 31, 2021 was $440,000$208,000 compared to $640,000$186,000 spent in the prior nine-monthsix-month period. The Company continuesWe continue to use “money manager” accounts for most stock transactions. By doing this, the Company gives an independent third-party firm, who are experts in this field, permission to buy and sell stocks at will. The Company pays a quarterly service fee based on the value of the investments.

Financing

 ●
Financing
●The Company continues to purchase back its common stock when the opportunity arises. For the nine-monthsix-month period ended JanuaryOctober 31, 2021, the Company purchased $28,000$26,000 worth of treasury stock. This isstock, in comparison to $71,000 spent$1,000 repurchased in the same nine monthscorresponding six-month period the priorlast year.

 ●The company paid out dividends of $1,892,000 during the nine months ending January 31, 2021. These dividends were paid during the second quarter. The company declared a dividend of $0.42$0.50 per share of common stock on September 30, 2020 and these dividends were2021, which was paid by October 31, 2020. As forout during the prior year numbers, dividends paid was $1,802,000 forsecond quarter. This is an increase to the nine months ending January 31, 2020. A dividend of $0.40 per common share$0.42, which was declared and paid during the second fiscal quarter last year.

The following is a list of ratios to help analyze George Risk Industries’ performance:

 As of  As of 
 January 31, 2021 January 31, 2020  October 31, 2021 October 31, 2020 

Working capital

(current assets – current liabilities)

 $43,984,000  $35,119,000  $48,623,000  $38,744,000 

Current ratio

(current assets / current liabilities)

  14.430   16.831   16.358   10.901 

Quick ratio

((cash + investments + AR) / current liabilities)

  12.567   14.597   13.940   9.317 

New Product Development

The Company and its engineering department continue to develop enhancements to product lines, develop new products whichthat complement existing products, and look for products that are well suited to our distribution network and manufacturing capabilities. Items currently in the development process include:

●Explosion proof contacts that will be UL listed for hazardous locations. There has been demand from our customers for this type of high security magnetic reed switch.
●An updated version of the pool access alarm (PAA) has met electrical listing testing (ETL) approval and we are currently waiting on component parts to begin production and field testing.has started. This next-generation model combines our battery operated DPA series with our hard wired 289 series. A variety of installation options will be available through jumper pin settings.settings such as instant alarm and seven second delay.
●Wireless technology is a main area of focus for product development. We are considering adding wireless technology to some of our current products. A wireless contact switch is in the final stages of development. Also, we are working on wireless versions of our pool access alarm and environmental sensors that will be easy to install in current construction. WeA redesign of our brass water valve shut-off system is near completion.
●The Company is developing magnetic contacts which are also concentrating on making products compatible with Wi-Fi, smartphone technologylisted under UL 634 Level 2. These sensors are for high security applications such as government buildings, military use, nuclear facilities, and the increasing popular Z-Wave standard for wireless home automation.financial institutions.

Other Information

In addition to researching and developing new products, management is always open to the possibility of acquiring a business or product line that would complement our existing operations. Due to the Company’s strong cash position, management believes this could be achieved without the need for outside financing. The intent is to utilize the equipment, marketing techniques and established customers to deliver new products and increase sales and profits.

22

There are no known seasonal trends with any of GRI’s products since we sell to distributors and OEM manufacturers. Our products are tied to the housing industry and will fluctuate with building trends.

Recently Issued Accounting Pronouncements

In June 2016 the FASB issued ASU No. 2016-13, “Financial Instruments –- Credit Losses (Topic 326),”(Topic 326): which was subsequently amended in February 2020 by ASU 2020-02, Measurement of“Financial Instruments - Credit Losses on Financial Instruments(Topic 326) and Leases (Topic 842).””, which requires entities to use a forward looking approach The amendments introduce an impairment model that is based on expected credit losses, rather than incurred losses, to estimate credit losses on certain types of financial instruments (e.g., loans and held-to-maturity securities), including trade receivables.certain off-balance sheet financial instruments (e.g., loan commitments). The FASB has subsequently issued updates toexpected credit losses should consider historical information, current information, and reasonable and supportable forecasts, including estimates of prepayments, over the standard to provide additional clarification on specific topics. Topic 326contractual term. Financial instruments with similar risk characteristics may be grouped together when estimating expected credit losses. The update with amendment is effective for fiscal years, and interim periods within those fiscal years beginning after December 15, 2019. We have applied this guidance, as of May 1, 2020, using a modified-retrospective approach. The application of this guidance did not require a cumulative effect adjustment to retained earnings and did not have a material effect on our financial statements.

In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement - Disclosure Framework (Topic 820). The updated guidance improves the disclosure requirements on fair value measurements. The updated guidance is effective for fiscal years, and2022, including interim periods within those fiscal years, beginning after December 15, 2019. Early adoption is permitted for any removed or modified disclosures. We appliedyears. The Company does not believe this new guidance as of May 1, 2020. The application of this guidance did notwill have a material effectimpact on our disclosures.its financial statements and will implement the disclosures related to this update beginning in 2023.

In January 2020, the FASB issued ASU 2020-01, “Investments - Equity Securities (Topic 321), Investments - Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815) - Clarifying the Interactions between Topic 321, Topic 323, and Topic 815.” The ASU is based on a consensus of the Emerging Issues Task Force and is expected to increase comparability in accounting for these transactions. ASU 2016-01 made targeted improvements to accounting for financial instruments, including providing an entity the ability to measure certain equity securities without a readily determinable fair value at cost, less any impairment, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer. Among other topics, the amendments clarify that an entity should consider observable transactions that require it to either apply or discontinue the equity method of accounting. For public business entities, the amendmentsASU 2020-01 deals with changes in the ASU aresignificant influence of derivative and investments, of which the Company has none and became effective for fiscal years beginning after December 15, 2020, and interim periods within those fiscal years. Early adoption is permitted.the Company in the first quarter of 2021. The Company does not expect the adoption of ASU 2020-01 tothis standard did not have a materialany impact on itsthe Company’s condensed financial statements.

There are no other new accounting pronouncements that are expected to have a significant impact on our financial statements.

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GEORGE RISK INDUSTRIES, INC.

PART I. FINANCIAL INFORMATION

Item 3. Quantitative and Qualitative Disclosures about Market Risk

Not applicable

Item 4. Controls and Procedures

Our management, under the supervision and with the participation of our chief executive officer (also working as our chief financial officer), evaluated the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of JanuaryOctober 31, 2021. Based on that evaluation, management concluded that the disclosure controls and procedures employed at the Company were not effective to provide reasonable assurance that the information required to be disclosed by us in the reports that we file or submit under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms.

In our annual report filed on Report 10-K for the year ended April 30 2020,,2021, management identified the following material weakness in our internal control over financial reporting:

●The small size of our Company limits our ability to achieve the desired level of separation of duties for proper internal controls and financial reporting, particularly as it relates to financial reporting to assure material disclosures or implementation of newly issued accounting standards are included. A secondary review over annual and quarterly filings does not occur.occur with an outside party. Due to the departure of the Controller, the current CEO and CFO roles are being fulfilled by the same individual. We do not have an audit committee. We do not believe we have met the full requirement for separation of duties for financial reporting purposes.

A Controller was hired byWe continue to operate with a limited number of accounting and financial personnel. For the quarter ending October 31, 2021 the Company in September 2020.did not have a Controller, but management is looking to fill this position as soon as possible. Training is currently happeningwill be required to fulfill disclosure control and procedure responsibilities, including review procedures for key accounting schedules and timely and proper documentation of material transactions and agreements. Until further sufficient training has been completedtaken place for this new Controller, we believe this control deficiency represents material weaknesses in internal control over financial reporting. To mitigate the effects of the material weakness identified in our annual report, the Company contracted with an outside CPA to perform a secondary review of our quarterly report filed on Form 10-Q.

Despite the material weaknesses in financial reporting noted above, we believe that our consolidated financial statements included in this report fairly present our financial position, results of operations and cash flows as of and for the periods presented in all material respects.

We are committed to the establishment of effective internal controls over financial reporting and will place emphasis on quarterly and year-end closing procedures, timely documentation and internal review of accounting and financial reporting consequences of material contracts and agreements, and enhanced review of all schedules and account analyses by experienced accounting department personnel or independent consultants.

Changes in Internal Control over Financial Reporting

Other than those mentioned above, there were no changes in our internal control over financial reporting during the fiscal quarter ended JanuaryOctober 31, 2021 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

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GEORGE RISK INDUSTRIES, INC.

Part II. OTHER INFORMATION

Item 1. Legal Proceedings

Not applicable

Item 1A. Risk Factors

Not applicable.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

The following table provides information relating to the Company’s repurchase and issuance of common stock for the thirdsecond quarter of fiscal year 2021.2022.

Period Number of shares repurchasedrepurchased/(issued)
November 1, 2020 – November 30, 2020550
December 1, 2020 – December 31, 20201,000
JanuaryAugust 1, 2021 – JanuaryAugust 31, 2021 -0-
1,200September 1, 2021 – September 30, 2021 2,000
October 1, 2021 – October 31, 2021-0-

Item 3. Defaults upon Senior Securities

Not applicable

Item 4. Mine Safety Disclosures

Not applicable

Item 5. Other Information

Not applicable

Item 6. Exhibits

Exhibit No. Description
31.1 
31.1Certification of the Chief Executive Officer (Principal Financial and Accounting Officer), as required by Section 302 of the Sarbanes-Oxley Act of 2002.
 
32.1 Certification of the Chief Executive Officer (Principal Financial and Accounting Officer), as required by Section 906 of the Sarbanes-Oxley Act of 2002.

SIGNATURES

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SIGNATURES

Pursuant to

In accordance with the requirements of the Securities Exchange Act, of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

George Risk Industries, Inc.

(Registrant)

DateDecember 15, 2021By:George Risk Industries, Inc.
(Registrant)
DateMarch 17, 2021By:/s/ Stephanie M. Risk-McElroy
Stephanie M. Risk-McElroy

President, Chief Executive Officer, Chief Financial Officer

and Chairman of the Board

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