UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 10-Q

(Mark One)

[X]	Quarterly report under Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarter ended ~~October~~January 31, ~~2017~~2018

[ ]	Transition report under 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 small business issuer as specified in its charter)

Colorado		84-0524756
(State of incorporation)		(IRS Employers Identification No.)

802 South Elm St.
Kimball, NE		69145
(Address of principal executive offices)		(Zip Code)

(308) 235-4645

(Registrant’s telephone number, including area code)

Check whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 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 [ X ] No [ ]~~

Yes [X]

No [ ]

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

~~Yes [ ] No [ X ]~~

Yes [ ]

No [X]

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

	Large accelerated filer [ ]	Accelerated filer [ ]
	Non-accelerated filer [ ]	Smaller reporting company ~~[ X ]~~[X]

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 ~~[ X ]~~[X]

APPLICABLE ONLY TO CORPORATE ISSUERS

The number of shares of the Registrant’s Common Stock outstanding, as of ~~December 19, 2017~~March 16, 2018, was ~~3,533,834.~~4,968,447.

Transitional Small Business Disclosure Format:Yes ~~[ X ]~~[X] No [ ]

GEORGE RISK INDUSTRIES, INC.

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

The unaudited financial statements for the three and ~~six-month~~nine-month period ended ~~October~~January 31, ~~2017,~~2018, are attached hereto.

GEORGE RISK INDUSTRIES, INC.

CONDENSED BALANCE SHEETS

	October 31, 2017		April 30, 2017
	(unaudited)				January 31, 2018		April 30, 2017
					(unaudited)
ASSETS

Current Assets:
Cash and cash equivalents	$	6,324,000	$	6,456,000	$	3,952,000	$	6,456,000
Investments and securities		25,897,000		26,382,000		27,496,000		26,382,000
Accounts receivable:
Trade, net of $2,425 and $2,425 doubtful account allowance		2,212,000		1,848,000
Trade, net of $16,422 and $2,425 doubtful account allowance						2,471,000		1,848,000
Other		—		3,000		2,000		3,000
Income tax overpayment		127,000		253,000		474,000		253,000
Inventories, net		3,593,000		2,304,000		3,594,000		2,304,000
Prepaid expenses		254,000		193,000		487,000		193,000
Total Current Assets	$	38,407,000	$	37,439,000	$	38,476,000	$	37,439,000

Property and Equipment, net, at cost		979,000		739,000		948,000		739,000

Other Assets
Investment in Limited Land Partnership, at cost		273,000		273,000		273,000		273,000
Projects in process		1,000		13,000		—		13,000
Other		77,000		—		77,000		—
Total Other Assets	$	351,000	$	286,000	$	350,000	$	286,000

Intangible Assets, net		1,824,000		—	$	1,794,000		—

TOTAL ASSETS	$	41,561,000	$	38,464,000	$	41,568,000	$	38,464,000

See accompanying notes to the condensed financial statements.

GEORGE RISK INDUSTRIES, INC.

CONDENSED BALANCE SHEETS

(continued)

October 31, 2017 April 30, 2017
(unaudited)

LIABILITIES AND STOCKHOLDERS’ EQUITY

Current Liabilities
Accounts payable, trade $ 166,000 $ 69,000
Asset acquisition payable 2,000,000 —
Dividends payable 1,580,000 1,416,000
Accrued expenses:
Deferred income taxes 275,000 308,000
Total Current Liabilities $ 4,021,000 $ 1,793,000

Long-Term Liabilities
Deferred income taxes 1,408,000 906,000
Total Long-Term Liabilities $ 1,408,000 $ 906,000

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 1,933,000 1,736,000
Accumulated other comprehensive income 1,949,000 1,239,000
Retained earnings 35,441,000 35,981,000
Less: treasury stock, 3,533,834 and 3,557,606 shares, at cost (4,140,000 ) (4,140,000 )
Total Stockholders’ Equity $ 36,132,000 $ 35,765,000

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY $ 41,561,000 $ 38,464,000

	January 31, 2018			April 30, 2017
	(unaudited)
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current Liabilities
Accounts payable, trade	$	308,000		$	69,000
Dividends payable		1,580,000			1,416,000
Accrued expenses:
Payroll and related expenses		178,000			308,000
Property taxes		3,000			—
Total Current Liabilities	$	2,069,000		$	1,793,000

Long-Term Liabilities
Deferred income taxes		1,902,000			906,000
Total Long-Term Liabilities	$	1,902,000		$	906,000

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			1,736,000
Accumulated other comprehensive income		2,623,000			1,239,000
Retained earnings		36,232,000			35,981,000
Less: treasury stock, 3,533,934 and 3,557,606 shares, at cost		(4,141,000	)		(4,140,000	)
Total Stockholders’ Equity	$	37,597,000		$	35,765,000

TOTAL LIABILITES AND STOCKHOLDERS’ EQUITY	$	41,568,000		$	38,464,000

See accompanying notes to the condensed financial statements

GEORGE RISK INDUSTRIES, INC.

CONDENSED INCOME STATEMENTS (Unaudited)

	Three months			Six months			Three months			Six months			Three months			Nine months			Three months			Nine months
	ended			ended			ended			ended			ended			ended			ended			ended
	Oct 31, 2017			Oct 31, 2017			Oct 31, 2016			Oct 31, 2016			Jan 31, 2018			Jan 31, 2018			Jan 31, 2017			Jan 31, 2017
Net Sales	$	3,089,000		$	5,337,000		$	2,883,000		$	5,549,000		$	3,260,000		$	8,597,000		$	2,645,000		$	8,194,000
Less: Cost of Goods Sold		(1,416,000	)		(2,511,000	)		(1,284,000	)		(2,670,000	)		(1,826,000	)		(4,337,000	)		(1,229,000	)		(3,899,000	)
Gross Profit	$	1,673,000		$	2,826,000		$	1,599,000		$	2,879,000		$	1,434,000		$	4,260,000		$	1,416,000		$	4,295,000

Operating Expenses
General and Administrative		290,000			519,000			230,000			441,000			313,000			833,000			223,000			664,000
Sales		443,000			859,000			487,000			971,000			512,000			1,371,000			461,000			1,432,000
Engineering		35,000			48,000			24,000			42,000			22,000			69,000			17,000			59,000
Rent Paid to Related Parties		4,000			9,000			4,000			9,000			5,000			14,000			5,000			14,000
Total Operating Expenses	$	772,000		$	1,435,000		$	745,000		$	1,463,000		$	852,000		$	2,287,000		$	706,000		$	2,169,000

Income From Operations		901,000			1,391,000			854,000			1,416,000			582,000			1,973,000			710,000			2,126,000

Other Income (Expense)
Other		1,000			3,000			7,000			10,000			—			3,000			1,000			11,000
Dividend and Interest Income		155,000			434,000			126,000			318,000			376,000			811,000			332,000			650,000
Gain (Loss) on Investments		9,000			(28,000	)		38,000			85,000			123,000			94,000			51,000			136,000
Gain (Loss) on Sale of Assets		—			4,000			—			—			—			4,000			—			—
	$	165,000		$	413,000		$	171,000		$	413,000		$	499,000		$	912,000		$	384,000		$	797,000

Income Before Provisions for Income Taxes		1,066,000			1,804,000			1,025,000			1,829,000			1,081,000			2,885,000			1,094,000			2,923,000

Provisions for Income Taxes:
Current Expense		(360,000	)		(572,000	)		(325,000	)		(583,000	)		281,000			852,000			313,000			896,000
Deferred Tax Benefit (Expense)		16,000			8,000			(8,000	)		13,000
Deferred Tax Expense (Benefit)														9,000			1,000			(11,000	)		(24,000	)
Total Income Tax Expense	$	(344,000	)	$	(564,000	)	$	(333,000	)	$	(570,000	)	$	290,000		$	853,000		$	302,000		$	872,000

Net Income	$	722,000		$	1,240,000		$	692,000		$	1,259,000		$	791,000		$	2,032,000		$	792,000		$	2,051,000

Cash Dividends
Common Stock ($0.36 per share)	$	1,780,000		$	1,780,000								$	—		$	1,780,000
Common Stock ($0.35 per share)							$	1,758,000		$	1,758,000								$	—		$	1,758,000

Income Per Share of Common Stock
Basic	$	0.15		$	0.25		$	0.14		$	0.25		$	0.16		$	0.41		$	0.16		$	0.41
Diluted	$	0.15		$	0.25		$	0.14		$	0.25		$	0.16		$	0.41		$	0.16		$	0.41

Weighted Average Number of Common Shares Outstanding
Weighted Average Number of Common
Shares Outstanding
Basic		4,953,070			4,949,081			5,021,660			5,021,701			4,969,013			4,955,725			4,945,972			4,996,453
Diluted		4,973,570			4,969,581			5,042,160			5,042,201			4,989,513			4,976,225			4,966,472			5,016,953

See accompanying notes to the condensed financial statements

GEORGE RISK INDUSTRIES, INC.

CONDENSED STATEMENT OF COMPREHENSIVE INCOME (Unaudited)

	Three months			Six months			Three months			Six months
	ended			ended			ended			ended			Three months			Nine months			Three months			Nine months
	Oct 31, 2017			Oct 31, 2017			Oct 31, 2016			Oct 31, 2016			ended			ended			ended			ended
													Jan 31, 2018			Jan 31, 2018			Jan 31, 2017			Jan 31, 2017
Net Income	$	722,000		$	1,240,000		$	692,000		$	1,259,000		$	791,000		$	2,032,000		$	792,000		$	2,051,000

Other Comprehensive Income, net of tax
Other Comprehensive Income, Net of Tax
Unrealized gain (loss) on securities:
Unrealized holding gains (losses) arising during period		709,000			1,338,000			(376,000	)		168,000			1,247,000			2,585,000			570,000			796,000
Reclassification adjustment for gains (losses) included in net income		(32,000	)		(117,000	)		(7,000	)		(25,000	)		(88,000	)		(205,000	)		(5,000	)		(88,000	)
Income tax benefit (expense) related to other comprehensive income		(283,000	)		(510,000	)		160,000			(60,000	)		(485,000	)		(995,000	)		(236,000	)		(296,000	)
Other Comprehensive Income														674,000			1,385,000			329,000			412,000

Other Comprehensive Income	$	394,000		$	711,000		$	(223,000	)	$	83,000
Comprehensive Income	$	1,116,000		$	1,951,000		$	469,000		$	1,342,000		$	1,465,000		$	3,417,000		$	1,121,000		$	2,463,000

See accompanying notes to the condensed financial statements

GEORGE RISK INDUSTRIES, INC.

CONDENSED STATEMENT OF CASH FLOWS (Unaudited)

	Six months			Six months			Nine months			Nine months
	ended			ended			ended			ended
	Oct 31, 2017			Oct 31, 2016			Jan 31, 2018			Jan 31, 2017
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Income	$	1,240,000		$	1,259,000		$	2,032,000		$	2,051,000
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		86,000			91,000			163,000			138,000
(Gain) loss on sale of investments		6,000			(98,000	)		(117,000	)		(149,000	)
Impairments on investments		23,000			13,000			23,000			13,000
Reserve for bad debts								13,000			—
Reserve for obsolete inventory		—			15,000			—			5,000
Deferred income taxes		(9,000	)		(13,000	)		1,000			(24,000	)
(Gain) loss on sale of assets		(4,000	)		—			(4,000	)		—
Treasury stock issued		200,000			—
Changes in assets and liabilities:
(Increase) decrease in:
Accounts receivable		(364,000	)		53,000			(636,000	)		163,000
Inventories		(1,290,000	)		286,000			(1,291,000	)		426,000
Prepaid expenses		(139,000	)		12,000			(359,000	)		(48,000	)
Other receivables		3,000			—			2,000			(5,000	)
Income tax overpayment		127,000			(2,000	)		(221,000	)		(43,000	)
Increase (decrease) in:
Accounts payable		98,000			97,000			239,000			20,000
Accrued expenses		(33,000	)		(16,000	)		(127,000	)		(72,000	)
Asset acquisition payable		2,000,000			—
Net cash provided by (used in) operating activities	$	1,944,000		$	1,697,000		$	(282,000	)	$	2,475,000

CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from sale of assets		4,000			—			4,000			—
(Purchase) of property and equipment		(314,000	)		(70,000	)		(342,000	)		(146,000	)
Proceeds from sale of marketable securities		2,002,000			37,000			2,013,000			586,000
(Purchase) of marketable securities		(324,000	)		(373,000	)		(653,000	)		(668,000	)
(Purchase) of intangible assets		(1,824,000	)		—			(1,624,000	)		—
(Purchase) of long-term investment		—			(20,000	)		—			(20,000	)
Net cash provided by (used in) investing activities	$	(456,000	)	$	(426,000	)	$	(602,000	)	$	(248,000	)

CASH FLOWS FROM FINANCING ACTIVITIES:
(Purchase) of treasury stock		(3,000	)		(1,000	)		(3,000	)		(551,000	)
Dividends paid		(1,617,000	)		(1,596,000	)		(1,617,000	)		(1,596,000	)
Net cash provided by (used in) financing activities	$	(1,620,000	)	$	(1,597,000	)	$	(1,620,000	)	$	(2,147,000	)

NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS	$	(132,000	)	$	(326,000	)	$	(2,504,000	)	$	80,000

Cash and Cash Equivalents, beginning of period	$	6,456,000		$	5,918,000		$	6,456,000		$	5,918,000
Cash and Cash Equivalents, end of period	$	6,324,000		$	5,592,000		$	3,952,000		$	5,998,000


Supplemental Disclosure for Cash Flow Information:
Cash payments for:
Income taxes	$	440,000		$	706,000		$	1,320,000		$	1,059,000
Interest paid	$	0		$	0		$	0		$	0
Cash receipts for:
Income taxes	$	0		$	0		$	253,000		$	125,000

Supplemental Disclosure of Noncash Investing and Financing Activities:
Issuance of treasury stock as part of asset acquisition	$	200,000			0		$	200,000		$	0

See accompanying notes to the condensed financial statements

GEORGE RISK INDUSTRIES, INC.

NOTES TO CONDENSED FINANCIAL STATEMENTS

~~OCTOBER~~JANUARY 31, ~~2017~~2018

Note 1 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 condensed financial statements be read in conjunction with the financial statements and notes thereto included in the Company’s April 30, 2017 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 May 2014, the FASB issued Accounting Standards Update No. 2014-09, Revenue from Contracts with Customers. The objective of this update is to provide a robust framework for addressing revenue recognition issues and, upon its effective date, replaces almost all existing revenue recognition guidance. This update is effective in annual reporting periods beginning after December 15, 2017 and the interim periods within that year. The Company is evaluating the impact of this update on the Company’s financial statements.

In February of 2016, the FASB issued ASU 2016-02Leases. Under the new guidance, lessees will be required to recognize so-called right-of-use assets and liabilities for most leases having lease terms of 12 months or more. This update is effective in annual reporting periods beginning after December 31, 2019 and the interim periods starting thereafter. The Company is evaluating the impact of this update on the Company’s financial statements.

In February of 2018, the FASB issued ASU 2018-02 Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income. Under this update, companies have the option to reclassify stranded tax effects caused by US Tax Cuts and Jobs Act (TCJA) from accumulated other comprehensive income (AOCI) to retained earnings. Under current US GAAP, effects from a change in tax law is recorded as a component of the income tax provision related to continuing operations in the period of enactment, even if the deferred taxes were established for a financial statement component not part of continuing operations, such as accumulated other comprehensive income (AOCI). Adopting of this standard will remove tax effects stranded in AOCI by the tax law enactment. Adoption of this ASU is optional. This update is effective in annual reporting periods beginning after December 15, 2018 and the interim periods starting thereafter. The Company is evaluating the impact of this update on the Company’s financial statements.

Note 2 2:Investments

The Company has investments in publicly traded equity securities, corporate bonds, state and municipal debt securities, real estate investment trusts, and money markets funds. The investments in securities are classified as available-for-sale securities and are reported at fair value. Available-for-sale investments in debt securities mature between ~~December 2017~~June 2018 and November 2048. The Company uses the average cost method to determine the cost of securities sold and the amount reclassified out of accumulated other comprehensive income into earnings. Unrealized gains and losses are excluded from earnings and reported separately as a component of stockholders’ equity. Dividend and interest income are reported as earned.

As of ~~October~~January 31, ~~2017~~2018 and April 30, 2017, investments consisted of the following:

			Gross		Gross							Gross		Gross
Investments at	Cost		Unrealized		Unrealized			Fair		Cost		Unrealized		Unrealized			Fair
October 31, 2017	Basis		Gains		Losses			Value
January 31, 2018										Basis		Gains		Losses			Value
Municipal bonds	$	6,060,000	$	111,000	$	(218,000	)	$	5,953,000	$	5,966,000	$	103,000	$	(238,000	)	$	5,831,000
Corporate bonds	$	129,000	$	2,000	$	-		$	131,000	$	129,000	$	2,000	$	—		$	131,000
REITs	$	110,000	$	2,000	$	(5,000	)	$	107,000	$	110,000	$	5,000	$	(6,000	)	$	109,000
Equity securities	$	15,474,000	$	3,700,000	$	(243,000	)	$	18,931,000	$	15,720,000	$	4,844,000	$	(203,000	)	$	20,361,000
Money markets and CDs	$	775,000	$	-	$	-		$	775,000	$	1,064,000	$	—	$	—		$	1,064,000
Total	$	22,548,000	$	3,815,000	$	(466,000	)	$	25,897,000	$	22,989,000	$	4,954,000	$	(447,000	)	$	27,496,000

			Gross		Gross
Investments at	Cost		Unrealized		Unrealized			Fair
April 30, 2017	Basis		Gains		Losses			Value
Municipal bonds	$	6,045,000	$	90,000	$	(97,000	)	$	6,038,000
Corporate bonds	$	129,000	$	1,000	$	—		$	130,000
REITs	$	64,000	$	13,000	$	(1,000	)	$	76,000
Equity securities	$	15,259,000	$	2,441,000	$	(319,000	)	$	17,381,000
Money markets and CDs	$	2,757,000	$	—	$	—		$	2,757,000
Total	$	24,254,000	$	2,545,000	$	(417,000	)	$	26,382,000

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 ~~recorded~~did not record an impairment loss during the quarter, but did record a loss of $23,000 for ~~both~~ the ~~quarter and six-months~~nine months ended ~~October~~January 31, ~~2017. As~~2018. Likewise, for the corresponding periods last year, management did not record a loss for the quarter, but did record a $13,000 impairment loss for the ~~six~~nine months ended ~~October~~January 31, ~~2016.~~2017.

The following ~~table shows~~tables show 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 ~~October~~January 31, ~~2017~~2018 and April 30, 2017, respectively.

Unrealized Loss Breakdown by Investment Type at ~~October~~January 31, ~~2017~~2018

	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	$	780,000	$	(149,000	)	$	1,168,000	$	(69,000	)	$	1,948,000	$	(218,000	)	$	702,000	$	(152,000	)	$	1,674,000	$	(86,000	)	$	2,376,000	$	(238,000	)
REITs	$	22,000	$	(1,000	)	$	25,000	$	(4,000	)	$	47,000	$	(5,000	)	$	56,000	$	(5,000	)	$	27,000	$	(1,000	)	$	83,000	$	(6,000	)
Equity securities	$	562,000	$	(75,000	)	$	943,000	$	(168,000	)	$	1,505,000	$	(243,000	)	$	534,000	$	(35,000	)	$	590,000	$	(168,000	)	$	1,124,000	$	(203,000	)
Total	$	1,364,000	$	(225,000	)	$	2,136,000	$	(241,000	)	$	3,500,000	$	(466,000	)	$	1,292,000	$	(192,000	)	$	2,291,000	$	(255,000	)	$	3,583,000	$	(447,000	)

Unrealized Loss Breakdown by Investment Type at April 30, 2017

	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	$	1,420,000	$	(19,000	)	$	1,292,000	$	(78,000	)	$	2,712,000	$	(97,000	)	$	1,420,000	$	(19,000	)	$	1,292,000	$	(78,000	)	$	2,712,000	$	(97,000	)
REITs	$	—	$	—		$	27,000	$	(1,000	)	$	27,000	$	(1,000	)	$	—	$	—		$	27,000	$	(1,000	)	$	27,000	$	(1,000	)
Equity securities	$	983,000	$	(92,000	)	$	1,689,000	$	(227,000	)	$	2,672,000	$	(319,000	)	$	983,000	$	(92,000	)	$	1,689,000	$	(227,000	)	$	2,672,000	$	(319,000	)
Total	$	2,403,000	$	(111,000	)	$	3,008,000	$	(306,000	)	$	5,411,000	$	(417,000	)	$	2,403,000	$	(111,000	)	$	3,008,000	$	(306,000	)	$	5,411,000	$	(417,000	)

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 ~~October~~January 31, ~~2017.~~2018.

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 ~~October~~January 31, ~~2017~~2018

Note 3 3:Inventories

Inventories at ~~October~~January 31, ~~2017~~2018 and April 30, 2017 consisted of the following:

							January 31,			April 30,
	October 31, 2017			April 30, 2017			2018			2017

Raw materials	$	2,804,000		$	1,579,000		$	2,704,000		$	1,579,000
Work in process		569,000			442,000			348,000			442,000
Finished goods		293,000			356,000			615,000			356,000
		3,666,000			2,377,000			3,667,000			2,377,000
Less: allowance for obsolete inventory		(73,000	)		(73,000	)		(73,000	)		(73,000	)
Totals	$	3,593,000		$	2,304,000		$	3,594,000		$	2,304,000

Note 4 4:Asset Purchase

In October 2017, George Risk Industries, Inc. (the “Company”) purchased assets from Labor Saving Devices, Inc. (“LSDI”). The purchase price for the assets consisted of $3,000,000 in cash and 24,097 shares of the Company’s Class A common stock (valued at $200,000, or approximately $8.30 per share). An initial payment of $1,000,000 in cash was made at closing, with the remaining $2,000,000 in cash paid in November 2017.

The value of the assets purchased as described above at ~~October~~January 31, ~~2017~~2018 consisted of the following:

Type of Assets	Beginning Balance		Amortization		Total Assets, Net		Beginning Balance		Amortization			Total Assets, Net
Inventory	$	1,366,000		—	$	1,366,000	$	1,366,000		—		$	1,366,000
Fixed Assets	$	10,000		—	$	10,000	$	10,000		—		$	10,000
Non-compete agreement	$	10,000		—	$	10,000	$	10,000		—		$	10,000
Intangible assets	$	1,814,000		—	$	1,814,000	$	1,814,000	$	(30,000	)	$	1,784,000
Total	$	3,200,000		—	$	3,200,000	$	3,200,000	$	(30,000	)	$	3,170,000

Since the asset purchase took place in October 2017, there was no value to these assets at April 30, 2017.

Note 5 5:Business Segments

The following is financial information relating to industry segments:

Three months Six months Three months Six months
ended ended ended ended
Oct 31, 2017 Oct 31, 2017 Oct 31, 2016 Oct 31, 2016
Net revenue:
Security alarm products $ 2,170,000 $ 3,967,000 $ 2,473,000 $ 4,746,000
Other products 919,000 1,370,000 410,000 803,000
Total net revenue $ 3,089,000 $ 5,337,000 $ 2,883,000 $ 5,549,000

Income from operations:
Security alarm products 670,000 1,034,000 732,000 1,211,000
Other products 231,000 357,000 122,000 205,000
Total income from operations $ 901,000 $ 1,391,000 $ 854,000 $ 1,416,000

Depreciation and amortization:
Security alarm products 10,000 17,000 7,000 21,000
Other products 21,000 43,000 28,000 53,000
Corporate general 14,000 26,000 12,000 17,000
Total depreciation and amortization $ 45,000 $ 86,000 $ 47,000 $ 91,000

Capital expenditures:
Security alarm products 50,000 260,000 — —
Other products 10,000 10,000 17,000 64,000
Corporate general 44,000 44,000 2,000 6,000
Total capital expenditures $ 104,000 $ 314,000 $ 19,000 $ 70,000

	October 31, 2017		April 30, 2017		Three months		Nine months		Three months		Nine months
Identifiable assets:
					ended		ended		ended		ended
					Jan 31, 2018		Jan 31, 2018		Jan 31, 2017		Jan 31, 2017
Net revenue:
Security alarm products					$	2,715,000	$	6,683,000	$	2,214,000	$	6,955,000
Other products						545,000		1,914,000		431,000		1,239,000
Total net revenue					$	3,260,000	$	8,597,000	$	2,645,000	$	8,194,000

Income from operations:
Security alarm products						452,000		1,534,000		603,000		1,805,000
Other products						130,000		439,000		107,000		321,000
Total income from operations					$	582,000	$	1,973,000	$	710,000	$	2,126,000

Depreciation and amortization:
Security alarm products		4,256,000		3,180,000		10,000		28,000		7,000		29,000
Other products		2,254,000		1,517,000		52,000		94,000		27,000		80,000
Corporate general		35,051,000		33,767,000		15,000		41,000		13,000		29,000
Total assets	$	41,561,000	$	38,464,000
Total depreciation and amortization					$	77,000	$	163,000	$	47,000	$	138,000

Capital expenditures:
Security alarm products						—		260,000		—		—
Other products						—		—		16,000		130,000
Corporate general						16,000		81,000		10,000		16,000
Total capital expenditures					$	16,000	$	341,000	$	26,000	$	146,000

	January 31, 2018		April 30, 2017
Identifiable assets:
Security alarm products		4,424,000		3,180,000
Other products		2,371,000		1,517,000
Corporate general		34,773,000		33,767,000
Total assets	$	41,568,000	$	38,464,000

Note 6 6:Earnings per Share

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

	For the three months ended October 31, 2017
	Income		Shares		Per-share			For the three months ended January 31, 2018
	(Numerator)		(Denominator)		Amount			Income		Shares		Per-share
								(Numerator)		(Denominator)		Amount
Net Income	$	722,000						$	791,000

Basic EPS	$	722,000		4,953,070	$	.1458		$	791,000		4,969,013	$	0.1592
Effect of dilutive securities:
Convertible preferred stock		0		20,500		(.0006	)		0		20,500

Diluted EPS	$	722,000		4,973,570	$	.1452		$	791,000		4,989,513	$	0.1585

	For the six months ended October 31, 2017
	Income		Shares		Per-share			For the nine months ended January 31, 2018
	(Numerator)		(Denominator)		Amount			Income		Shares		Per-share
								(Numerator)		(Denominator)		Amount
Net Income	$	1,240,000						$	2,032,000

Basic EPS	$	1,240,000		4,949,081	$	.2506		$	2,032,000		4,955,725	$	0.4100
Effect of dilutive securities:
Convertible preferred stock		0		20,500		(.0011	)		0		20,500

Diluted EPS	$	1,240,000		4,969,581	$	.2595		$	2,032,000		4,976,225	$	0.4083

For the three months ended October 31, 2016
Income Shares Per-share
(Numerator) (Denominator) Amount

Net Income $ 692,000

Basic EPS $ 692,000 5,021,660 $ .1378
Effect of dilutive securities:
Convertible preferred stock 0 20,500 (.0006 )

Diluted EPS $ 692,000 5,042,160 $ .1372
For the six months ended October 31, 2016
Income Shares Per-share
(Numerator) (Denominator) Amount

Net Income $ 1,259,000

Basic EPS $ 1,259,000 5,021,701 $ .2507
Effect of dilutive securities:
Convertible preferred stock 0 20,500 (.0010 )

Diluted EPS $ 1,259,000 5,042,201 $ .2497

	For the three months ended January 31, 2017
	Income		Shares		Per-share
	(Numerator)		(Denominator)		Amount
Net Income	$	792,000

Basic EPS	$	792,000		4,945,972	$	0.1601
Effect of dilutive securities:
Convertible preferred stock		0		20,500
Diluted EPS	$	792,000		4,966,472	$	0.1595

	For the nine months ended January 31, 2017
	Income		Shares		Per-share
	(Numerator)		(Denominator)		Amount
Net Income	$	2,051,000
Basic EPS	$	2,051,000		4,996,453	$	0.4105
Effect of dilutive securities:
Convertible preferred stock		0		20,500
Diluted EPS	$	2,051,000		5,016,953	$	0.4088

Note 7 7: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 corporation. The Plan is intended to be qualified under Section 401(k) of the Internal Revenue Code of 1986, as amended. Matching contributions by the Company of approximately ~~$3,000~~$2,000 were paid during both the quarters ending ~~October~~January 31, ~~2017~~2018 and ~~2016,~~2017, respectively. Likewise, the Company paid matching contributions of approximately ~~$5,000~~$8,000 during ~~both~~ the ~~six-month periods~~nine-month period ending ~~October~~January 31, ~~2017~~2018 and ~~2016, respectively.~~$7,000 during the corresponding period the prior fiscal year.

Note 88: Fair Value Measurements

Generally accepted accounting principles in the United States of America (US GAAP) defines fair value as 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 1	Valuation is based upon quoted prices for identical instruments traded in active markets.

	Level 2	Valuation 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 3	Valuation 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 ~~October~~January 31, ~~2017,~~2018, our investments consisted of money markets, publicly traded equity securities, real estate investment trusts ~~(REITs)~~(REITS) as well as certain state and municipal debt securities and corporate bonds. Our marketable securities are valued using third-party broker statements. The value of the investments 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 ~~table sets~~tables set 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 October 31, 2017								Assets Measured at Fair Value on a Recurring Basis as of January 31, 2018
	Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3		Total
Assets:
Municipal Bonds	$	-	$	5,953,000	$	-	$	5,953,000	$	-	$	5,831,000	$	-	$	5,831,000
Corporate Bonds	$	131,000	$	-	$	-	$	131,000	$	131,000	$	-	$	-	$	131,000
REITs	$	-	$	107,000	$	-	$	107,000	$	-	$	109,000	$	-	$	109,000
Equity Securities	$	18,931,000	$	-	$	-	$	18,931,000	$	20,361,000	$	-	$	-	$	20,361,000
Money Markets and CDs	$	775,000	$	-	$	-	$	775,000	$	1,064,000	$	-	$	-	$	1,064,000
Total fair value of assets measured on a recurring basis	$	19,837,000	$	6,060,000	$	-	$	25,897,000	$	21,556,000	$	5,940,000	$	-	$	27,496,000

	Assets Measured at Fair Value on a Recurring Basis as of April 30, 2017
	Level 1		Level 2		Level 3		Total
Assets:
Municipal Bonds	$	—	$	6,038,000	$	—	$	6,038,000
Corporate Bonds	$	130,000	$	—	$	—	$	130,000
REITs	$	—	$	76,000	$	—	$	76,000
Equity Securities	$	17,381,000	$	—	$	—	$	17,381,000
Money Markets and CDs	$	2,757,000	$	—	$	—	$	2,757,000
Total fair value of assets measured on a recurring basis	$	20,268,000	$	6,114,000	$	—	$	26,382,000

Note 99: Subsequent Events

None

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 condensed consolidated financial statements, and with the Company’s audited financial statements and discussion for the fiscal year ended April 30, 2017.

Executive Summary

The Company’s performance has remained ~~consistent~~steady through the ~~first half~~three quarters, with increased sales, being offset by increased cost of ~~the fiscal year~~sales, and ~~even seeing a bit of growth during the second quarter.~~greatly improved investment returns. This is due to the continuation of our quality USA made products with the ability for customization, our notable customer service, and the purchase of the assets of Labor Saving Devices, Inc. ~~Additionally, impressive performance in~~New challenges the ~~stock market~~Company has ~~generated adequate returns on~~endured over the ~~marketable securities. Challenges in~~nine months of this fiscal year include the ~~coming months include continuing to learn about~~continuation of training of our new software system, learning and ~~train employees on~~incorporating the ~~new computer software,~~Labor Saving Devices product line, and dealing with ~~the hopes~~some shortages and defects of ~~getting our facilities running more lean and profitable than ever before and growing the business.~~raw materials.

Results of Operations

	●	Net sales were ~~$3,089,000~~$3,260,000 for the quarter ended ~~October~~January 31, ~~2017,~~2018, which is a ~~7.15%~~23.25% increase from the corresponding quarter last year. Year-to-date net sales were ~~$5,337,000~~$8,597,000 at ~~October~~January 31, ~~2017,~~2018, which is a ~~3.82% decrease~~4.92% increase from the same period last year. ~~The slight variations~~A significant part of growth in sales ~~shows the stability~~is a direct result of the ~~Company~~asset purchase of Labor Saving Devices and ~~loyalty~~having a new product line to sell as a result of ~~its customer base. Our~~the purchase. Also, our ongoing commitment to outstanding customer service and customization of products are a few of the many reasons sales remained ~~relatively constant. Also, new sales are emerging since GRI acquired~~steady over the assets of the Labor Saving Devices. Direct competition and the inability to bring new products to market in a timelier manner are a few of the reasons why management believes sales haven’t grown more.years.

	●	Cost of goods sold was ~~45.84%~~56.0% of net sales for the quarter ended ~~October~~January 31, ~~2017~~2018 and was ~~44.54%~~46.4% for the same quarter last year. Year-to-date cost of goods sold percentages were ~~47.05%~~50.4% for the current ~~six~~nine months and ~~48.12%~~47.6% for the corresponding ~~six~~nine months last year, ~~keeping within~~which is just slightly over the target of less than 50% for both the quarter and year-to-date results. There were some added expenses that were incurred with the purchase of Labor Saving Devices that happened during this quarter but they were “one time” expenses management expects the cost of goods sold percentage to fall to return to normal in the future.

	●	Operating expenses ~~were up $27,000~~increased by $146,000 for the quarter and ~~were down $28,000~~also increased by $118,000 for the ~~six-months~~nine-months ended ~~October~~January 31, ~~2017~~2018 as compared to the corresponding periods last year. These increased costs ~~for the quarter~~ are primarily due to increased new product development, increased commissions, and additional training and maintenance fees on our new computer ~~software. The Company has been able to keep the operating expenses at less than 30% of net sales for many years; however, the effects of paying for training of the new computer~~ software and currently paying maintenance and support fees on two software platforms has added to these expenses. Management is hopefully that the increased sales of the new product lines will help keep operating expenses down.

	●	Income from operations for the quarter ended ~~October~~January 31, ~~2017~~2018 was at ~~$901,000~~$582,000 which is ~~a 5.5% increase~~an 18.02% decrease from the corresponding quarter last year, which had income from operations of ~~$854,000.~~$710,000. Income from operations for the ~~six~~nine months ended ~~October~~January 31, ~~2017~~2018 was at ~~$1,391,000,~~$1,973,000, which is a ~~1.77%~~7.20% decrease from the corresponding ~~six~~nine months last year, which had income from operations of ~~$1,416,000.~~$2,126,000.

	●	Other income and expenses are ~~down slightly and remained steady~~up when comparing to the current quarter and ~~six-month~~nine-month periods in the prior year, with ~~a decrease~~an increase of ~~$6,000~~$115,000 in the current quarter and ~~no change~~an increase of $115,000 for the current year-to-date. The majority of activity in these accounts consists of investment interest, dividends, and gain or loss on sale of investments. With the ~~recent uptick~~continued growth in the performance of the stock market, decisions were made to sell holdings ~~that were not strong performers, so losses were realized. This has been offset by increased~~and take the realized gain and dividends and ~~interest.~~interest payments exceeded expectations and many of our holdings had additional and increased dividend payouts.

	●	Overall, net income for the quarter ended ~~October~~January 31, ~~2017~~2018 was ~~up $41,000,~~down $1,000, or ~~4.0%~~0.13%, from the same quarter last year. ~~Conversely,~~Similarly, net income for the ~~six-month~~nine-month period ended ~~October~~January 31, ~~2017~~2018 was down $19,000, or ~~1.51%~~0.93%, from the same period in the prior year.

	●	Earnings per common share for quarter ended ~~October~~January 31, ~~2017~~2018 were ~~$0.15~~$0.16 per share and ~~$0.25~~$0.41 per share for the year-to-date ~~period.~~numbers. EPS for the quarter and ~~six~~nine months ended ~~October~~January 31, ~~2016~~2017 were ~~$0.14~~also $0.16 per share and ~~$0.25~~$0.41 per share, respectively.

Liquidity and capital resources

Operating

	●	Net cash decreased ~~$132,000~~$2,504,000 during the ~~six~~nine months ended ~~October~~January 31, ~~2017~~2018 as compared to ~~a decrease~~an increase of ~~$339,000~~$80,000 during the corresponding period last year. This is primarily due to the asset purchase of Labor Saving Devices, Inc., which was done without outside financing.

	●	Accounts receivable increased ~~$364,000~~$636,000 for the ~~six~~nine months ended ~~October~~January 31, ~~2017~~2018 compared with a ~~$53,000~~$163,000 decrease for the same period last year. The current year increase is a result of improved sales ~~during the second quarter~~ and collections on accounts receivable taking a bit longer than normal. Management believes that approximately $16,000 of accounts over 90 days have a possibility of being uncollectible.

	●	Inventories increased ~~$1,290,000~~$1,291,000 during the current ~~six-month~~nine-month period as compared to ~~a $286,000~~an decrease of $426,000 last year, primarily due to the inventory purchased from Labor Saving Devices.

	●	Prepaid expenses saw a ~~$139,000~~$359,000 increase for the current ~~six~~nine months, primarily due to ~~a large amount~~the prepayment of inventory ~~that has been paid for but not delivered yet. The~~the Company purchases. Likewise, the prior ~~six~~nine months showed a ~~$12,000 decrease~~$48,000 increase in prepaid expenses.

	●	Income tax overpayment for the ~~period~~nine months ended ~~October~~January 31, ~~2017 decreased $127,000, while there was~~2018 increased $221,000, as the overpayment also showed an increase of ~~$2,000~~$43,000 for the same period the prior year. ~~Management usually pays income tax estimates in the same amounts that were actually taxed on~~The main reason for the ~~prior year when we don’t expect a huge fluctuation in~~current increase is that the Company expects to generate additional income ~~and since net income up to~~with the asset acquisition that happened earlier this ~~point is close to the same as last year, the estimates are a close match to the actual expense.~~fiscal year.

	●	Accounts payable shows increases for both ~~six-month~~nine-month periods at ~~$98,000~~$239,000 and ~~$97,000,~~$20,000, respectively. The company strives to pay all invoices within terms, and the ~~slight~~ variance in ~~the~~ increases is primarily due to the timing of receipt of products and payment of invoices.

	●	Accrued expenses decreased ~~$33,000~~$127,000 for the current ~~six-month~~nine-month period as compared to a ~~$16,000~~$72,000 decrease for the ~~six-month~~nine-month period ended ~~October~~January 31, ~~2016.~~

●	Asset acquisition payable increased by $2,000,000 for the current six-month period in comparison to not having this payable on the books for the corresponding period last year. This line item corresponds with the asset acquisition of Labor Saving Devices. A down payment was made at the close of the agreement, which occurred in October 2017, and the rest of the funds were due to Labor Saving Devices upon the completion of the delivery of the assets to GRI.2017.

Investing

	●	As for our investment activities, the Company spent approximately ~~$314,000~~$342,000 on acquisitions of property and equipment for the current ~~six-month~~nine-month period, in comparison towith the corresponding ~~six~~nine months last year, where there was activity of ~~$70,000.~~$146,000.

	●	As a result of the asset acquisition of Labor Saving Devices, Inc. (“LSDI”), ~~there were $1,824,000 worth~~a net amount of $1,624,000 of intangible assets ~~that~~ were bought, along with inventory and fixed assets. Since the acquisition took place in the current ~~quarter,~~year, there was no cash towards this item for the same reporting period last year.

	●	Additionally, the Company continues to purchase marketable securities, which include municipal bonds and quality stocks. During the ~~six-month~~nine-month period ended ~~October~~January 31, ~~2017~~2018 there was quite a bit of buy/sell activity in the investment accounts. Net cash spent on purchases of marketable securities for the ~~six-month~~nine-month period ended ~~October~~January 31, ~~2017~~2018 was ~~$324,000~~$653,000 compared to ~~$373,000~~$668,000 spent in the prior ~~six-month~~nine-month period. We 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

	●	The Company continues to purchase back common stock when the opportunity arises. For the ~~six-month~~nine-month period ended ~~October~~January 31, ~~2017,~~2018, the Company purchased $3,000 worth of treasury ~~stock,~~stock. This is in comparison to ~~$1,000 repurchased~~$551,000 spent in the ~~corresponding six-month~~same nine months period ~~last~~the prior year.

	●	The company paid out dividends of $1,617,000 during the nine months ending January 31, 2018. These dividends were paid during the second quarter. The company declared a dividend of $0.36 per share of common stock on September 30, 2017 ~~which~~and these dividends were paid by October 31, 2017. As for the prior year numbers, dividend paid was ~~paid out during~~$1,596,000 for the ~~second quarter. This is a slight increase to the~~nine months ending January 31, 2017. A dividend of $0.35 ~~which~~per common share 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:

For the quarter ended
October 31, 2017 October 31, 2016
Working capital
(current assets – current liabilities)
$ 34,386,000 $ 33,469,000
Current ratio
(current assets / current liabilities)
9.552 17.760
Quick ratio
((cash + investments + AR) / current liabilities)
8.563 16.297

	For the quarter ended
	January 31, 2018		January 31, 2017
Working capital (current assets – current liabilities)	$	36,407,000	$	34,041,000
Current ratio (current assets / current liabilities)		18.596		17.171
Quick ratio ((cash + investments + AR) / current liabilities)		16.394		15.773

New Product Development

The Company and its engineering department continue to develop enhancements to product lines, develop new products which 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:

	●	A new face plate for our pool alarms is nearing completion. The innovative design is slim in style and will also allow the homeowner to change the plate to match their décor.

	●	An updated version of the pool access alarm is currently going through ETL testing. 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.

	●	The case for our ~~CC-15~~CC15 is complete and has been submitted to U.L. for approval for the US and Canada. This will allow us to manufacture several different versions. One is a 15-amp version that would automatically turn on a whole room of lights. Another is a 220-volt version to be used in international markets.

●	We have completed two new low voltage switching devices and they have been introduced into the marketplace. The LVSD is a 2-amp, 12/24-VDC switching device that will power devices such as small motors, fans, sirens, strobes and LED lights. The LEDSD is a 2amp, 12/24-VDC controller with 2.1mm x 5.5mm connectors for use with LED lighting (puck, rope, strip, track and more). It can be used to turn on LED lighting in cabinets, display cases, closets, pantries, etc.

●	Mold work has been completed on connectors for our EZ-Duct line and these connectors are currently out for ETL. testing. This will allow the raceway line to be ETL Listed for fire rating and high voltage. A new mold design for the cover of our 29-Series terminal switch is also being worked on.

●	We continue to work on high security switches. We have a triple biased high security switch design nearly complete and an adjustable magnet design was completed for recessed mounting applications.

	●	We continue to research the possibilities of fuel level sensing and how that may also serve other agricultural based needs. Several companies from around the world have been looking for ways to secure fuel tanks and trucks. Our emphasis would be in ways to safely monitor fuel levels and report tampering.

	●	A new float water sensor is being developed that will monitor water levels in livestock tanks and sump pumps.

	●	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 Alarm and environmental sensors that will be easy to install in current construction. We are also concentrating on making products compatible with Wi-Fi, smartphone technology and the increasing popular Z-Wave standard for wireless home automation.

	●	An updated version of our 200-36 & 4532 overhead door switch line up is nearing completion with the new aluminum cases presently on order. The modified versions, the 200-36UF and ~~4532UP,~~4532UF, are being made as a universal fit switch. This will allow an installer to replace an existing switch without drilling new holes into the cement or adjusting the location. The modified case has an additional mounting hole along with reshaped mounting holes.

●	Two sizes of our custom power transfer device (PTDC) have been introduced. The PTDC series offers a secure way to channel electrical wiring from the door frame to the door and are used for powering exit bars, locks, electric strikes etc. GRI offers two different end pieces; 0.218” inside diameter and 0.313” inside diameter, which will allow different sizes of wire to be looped through the custom length armored cable.

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.

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 May 2014, the FASB issued Accounting Standards Update No. 2014-09, Revenue from Contracts with Customers. The objective of this update is to provide a robust framework for addressing revenue recognition issues and, upon its effective date, replaces almost all existing revenue recognition guidance. This update is effective in annual reporting periods beginning after December 15, 2017 and the interim periods within that year. The Company is evaluating the impact of this update on the Company’s financial statements.

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 ~~October~~January 31, ~~2017.~~2018. Based on that evaluation, our chief executive officer (also working as our chief financial officer) 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.

We have taken measures to improve our disclosure controls and procedures. A new accounting professional was hired in October 2017 to fill the Controller position. Regarding this filing, more training will 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 sufficient training has taken place of this new Controller, we believe this control deficiency represents material weaknesses in internal control over financial reporting.

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

There was no change in our internal control over financial reporting during the fiscal quarter ended ~~October~~January 31, ~~2017~~2018 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

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 ~~second~~third quarter of fiscal year 2018. ~~The issuance of the common stock was part of the asset acquisition of Labor Saving Devices that took place during the quarter.~~

Period	Number of shares ~~repurchased/(issued)~~repurchased
~~August~~November 1, 2017 – ~~August~~November 30, 2017		-0-
December 1, 2017 – December 31, 2017		-0-
~~September~~January 1, ~~2017~~2018 – ~~September 30, 2017~~January 31, 2018		~~-0-~~100
~~October 1, 2017 – October 31, 2017~~		~~(24,097~~	)

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

	10.1		Material Contract – Purchase Agreement

	31.1		Certification 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

~~In accordance with~~Pursuant to 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)

Date ~~December 19, 2017~~March 16, 2018	By:	/s/ Stephanie M. Risk-McElroy
		Stephanie M. Risk-McElroy
		President, Chief Executive Officer, Chief Financial Officer and Chairman of the Board

	For the quarter ended
	October 31, 2017		October 31, 2016
Working capital (current assets – current liabilities)	$	34,386,000	$	33,469,000
Current ratio (current assets / current liabilities)		9.552		17.760
Quick ratio ((cash + investments + AR) / current liabilities)		8.563		16.297