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 ~~January~~July 31, 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~~Indicate by check mark whether the ~~issuer~~registrant (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]

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]

APPLICABLE ONLY TO CORPORATE ISSUERS

The number of shares of the Registrant’s Common Stock outstanding, as of ~~March 16,~~September 14, 2018 was ~~4,968,447.~~4,962,447.

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

GEORGE RISK INDUSTRIES, INC.

PART I. FINANCIAL INFORMATION

~~Item 1. Financial Statements~~

ITEM 1:

Financial Statements

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

~~GEORGE RISK INDUSTRIES, INC.~~George Risk Industries, Inc.

~~CONDENSED BALANCE SHEETS~~Condensed Balance Sheets

January 31, 2018 April 30, 2017
(unaudited)
ASSETS
Current Assets:
Cash and cash equivalents $ 3,952,000 $ 6,456,000
Investments and securities 27,496,000 26,382,000
Accounts receivable:
Trade, net of $16,422 and $2,425 doubtful account allowance 2,471,000 1,848,000
Other 2,000 3,000
Income tax overpayment 474,000 253,000
Inventories, net 3,594,000 2,304,000
Prepaid expenses 487,000 193,000
Total Current Assets $ 38,476,000 $ 37,439,000

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

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

Intangible Assets, net $ 1,794,000 —

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

~~See accompanying notes to the condensed financial statements.~~

~~GEORGE RISK INDUSTRIES, INC.~~

~~CONDENSED BALANCE SHEETS~~

~~(continued)~~

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

	July 31, 2018		April 30, 2018
	(unaudited)
ASSETS
Current Assets:
Cash and cash equivalents	$	4,947,000	$	4,294,000
Investments and securities, at fair value		27,161,000		26,346,000
Accounts receivable:
Trade, net of $10,075 and $6,651 doubtful account allowance		2,308,000		2,545,000
Other		1,000		2,000
Income tax overpayment		504,000		747,000
Inventories, net		3,650,000		3,267,000
Prepaid expenses		401,000		603,000
Total Current Assets		38,972,000		37,804,000

Property and Equipment, net, at cost		1,024,000		1,076,000

Other Assets
Investment in Limited Land Partnership, at cost		293,000		293,000
Other		41,000		6,000
Total Other Assets		334,000		299,000

Intangible assets, net		1,732,000		1,763,000

TOTAL ASSETS	$	42,062,000	$	40,942,000

See accompanying notes to the condensed financial statements

~~GEORGE RISK INDUSTRIES, INC.~~George Risk Industries, Inc.

~~CONDENSED INCOME STATEMENTS (Unaudited)~~Condensed Balance Sheets

(continued)

Three months Nine months Three months Nine months
ended ended ended ended
Jan 31, 2018 Jan 31, 2018 Jan 31, 2017 Jan 31, 2017
Net Sales $ 3,260,000 $ 8,597,000 $ 2,645,000 $ 8,194,000
Less: Cost of Goods Sold (1,826,000 ) (4,337,000 ) (1,229,000 ) (3,899,000 )
Gross Profit $ 1,434,000 $ 4,260,000 $ 1,416,000 $ 4,295,000

Operating Expenses
General and Administrative 313,000 833,000 223,000 664,000
Sales 512,000 1,371,000 461,000 1,432,000
Engineering 22,000 69,000 17,000 59,000
Rent Paid to Related Parties 5,000 14,000 5,000 14,000
Total Operating Expenses $ 852,000 $ 2,287,000 $ 706,000 $ 2,169,000

Income From Operations 582,000 1,973,000 710,000 2,126,000

Other Income (Expense)
Other — 3,000 1,000 11,000
Dividend and Interest Income 376,000 811,000 332,000 650,000
Gain (Loss) on Investments 123,000 94,000 51,000 136,000
Gain (Loss) on Sale of Assets — 4,000 — —
$ 499,000 $ 912,000 $ 384,000 $ 797,000

Income Before Provisions for Income Taxes 1,081,000 2,885,000 1,094,000 2,923,000

Provisions for Income Taxes:
Current Expense 281,000 852,000 313,000 896,000
Deferred Tax Expense (Benefit) 9,000 1,000 (11,000 ) (24,000 )
Total Income Tax Expense $ 290,000 $ 853,000 $ 302,000 $ 872,000

Net Income $ 791,000 $ 2,032,000 $ 792,000 $ 2,051,000

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

Income Per Share of Common Stock
Basic $ 0.16 $ 0.41 $ 0.16 $ 0.41
Diluted $ 0.16 $ 0.41 $ 0.16 $ 0.41

Weighted Average Number of Common
Shares Outstanding
Basic 4,969,013 4,955,725 4,945,972 4,996,453
Diluted 4,989,513 4,976,225 4,966,472 5,016,953

	July 31, 2018			April 30, 2018
	(unaudited)
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current Liabilities
Accounts payable, trade	$	329,000		$	336,000
Dividends payable		1,579,000			1,580,000
Accrued expenses:
Payroll and related expenses		166,000			329,000
Property taxes		3,000			12,000
Total Current Liabilities		2,077,000			2,257,000

Long-Term Liabilities
Deferred income taxes		1,179,000			955,000
Total Long-Term Liabilities		1,179,000			955,000

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		2,712,000			2,249,000
Retained earnings		37,364,000			36,746,000
Less: treasury stock, 3,535,434 and 3,534,784 shares, at cost		(4,153,000	)		(4,148,000	)
Total Stockholders’ Equity		38,806,000			37,730,000

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	42,062,000		$	40,942,000

See accompanying notes to the condensed financial statements

~~GEORGE RISK INDUSTRIES, INC.~~George Risk Industries, Inc.

~~CONDENSED STATEMENT OF COMPREHENSIVE INCOME~~ Condensed Income Statements

For the three months ended July 31, 2018 and 2017

(Unaudited)

Three months Nine months Three months Nine months
ended ended ended ended
Jan 31, 2018 Jan 31, 2018 Jan 31, 2017 Jan 31, 2017
Net Income $ 791,000 $ 2,032,000 $ 792,000 $ 2,051,000

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

Comprehensive Income $ 1,465,000 $ 3,417,000 $ 1,121,000 $ 2,463,000

	July 31, 2018			July 31, 2017

Net Sales	$	3,429,000		$	2,248,000
Less: Cost of Goods Sold		(1,801,000	)		(1,095,000	)
Gross Profit		1,628,000			1,153,000

Operating Expenses:
General and Administrative		286,000			229,000
Sales		555,000			416,000
Engineering		9,000			13,000
Rent Paid to Related Parties		5,000			5,000
Total Operating Expenses		855,000			663,000

Income From Operations		773,000			490,000

Other Income (Expense)
Other		3,000			3,000
Dividend and Interest Income		193,000			279,000
Gain (Loss) on Sales of Assets		—			4,000
Gain (Loss) on Sale of Investments		(68,000	)		(38,000	)
		128,000			248,000

Income Before Provisions for Income Taxes		901,000			738,000

Provisions for Income Taxes
Current Expense		247,000			213,000
Deferred tax expense (benefit)		37,000			7,000
Total Income Tax Expense		284,000			220,000

Net Income	$	617,000		$	518,000

Basic Earnings Per Share of Common Stock	$	0.12		$	0.10
Diluted Earnings Per Share of Common Stock	$	0.12		$	0.10

Weighted Average Number of Common Shares Outstanding		4,967,580			4,945,092
Weighted Average Number of Shares Outstanding (Diluted)		4,988,080			4,965,592

See accompanying notes to the condensed financial statements

~~GEORGE RISK INDUSTRIES, INC.~~George Risk Industries, Inc.

~~CONDENSED STATEMENT OF CASH FLOWS~~ Condensed Statements of Comprehensive Income

For the three months ended July 31, 2018 and 2017

(Unaudited)

Nine months Nine months
ended ended
Jan 31, 2018 Jan 31, 2017
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Income $ 2,032,000 $ 2,051,000
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization 163,000 138,000
(Gain) loss on sale of investments (117,000 ) (149,000 )
Impairments on investments 23,000 13,000
Reserve for bad debts 13,000 —
Reserve for obsolete inventory — 5,000
Deferred income taxes 1,000 (24,000 )
(Gain) loss on sale of assets (4,000 ) —
Changes in assets and liabilities:
(Increase) decrease in:
Accounts receivable (636,000 ) 163,000
Inventories (1,291,000 ) 426,000
Prepaid expenses (359,000 ) (48,000 )
Other receivables 2,000 (5,000 )
Income tax overpayment (221,000 ) (43,000 )
Increase (decrease) in:
Accounts payable 239,000 20,000
Accrued expenses (127,000 ) (72,000 )
Net cash provided by (used in) operating activities $ (282,000 ) $ 2,475,000

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

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

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

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

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

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

	July 31, 2018			July 31, 2017

Net Income	$	617,000		$	518,000

Other Comprehensive Income, Net of Tax
Unrealized gain (loss) on securities:
Unrealized holding gains (losses) arising during period		607,000			629,000
Reclassification adjustment for gains (losses) included in net income		44,000			(84,000	)
Income tax expense related to other comprehensive income		(188,000	)		(228,000	)
Other Comprehensive Income (Loss)		463,000			317,000

Comprehensive Income	$	1,080,000		$	835,000

See accompanying notes to the condensed financial statements

George Risk Industries, Inc.

Condensed Statements of Cash Flows

For the three months ended July 31, 2018 and 2017

(Unaudited)

	July 31, 2018			July 31, 2017
Cash Flows from Operating Activities:
Net Income	$	617,000		$	518,000
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		83,000			41,000
(Gain) loss on sale of investments		68,000			38,000
Reserve for bad debts		3,000			—
Reserve for obsolete inventory		6,000			—
Deferred income taxes		37,000			7,000
(Gain) loss on sale of assets		—			(4,000	)
Changes in assets and liabilities:
(Increase) decrease in:
Accounts receivable		234,000			257,000
Inventories		(389,000	)		(62,000	)
Prepaid expenses		166,000			63,000
Employee receivables		—			1,000
Income tax overpayment		244,000			208,000
Increase (decrease) in:
Accounts payable		(7,000	)		112,000
Accrued expenses		(172,000	)		(163,000	)
Net cash provided by (used in) operating activities	$	890,000		$	1,016,000

Cash Flows From Investing Activities:
Proceeds from sale of assets		—			4,000
(Purchase) of property and equipment		—			(253,000	)
Proceeds from sale of marketable securities		2,000			2,000
(Purchase) of marketable securities		(233,000	)		(224,000	)
Net cash provided by (used in) investing activities	$	(231,000	)	$	(471,000	)

Cash Flows From Financing Activities:
(Purchase) of treasury stock		(5,000	)		(3,000	)
Dividends paid		(1,000	)		—
Net cash provided by (used in) financing activities	$	(6,000	)	$	(3,000	)

Net Increase (Decrease) in Cash and Cash Equivalents	$	653,000		$	542,000

Cash and Cash Equivalents, beginning of period	$	4,294,000		$	6,456,000
Cash and Cash Equivalents, end of period	$	4,947,000		$	6,998,000

Supplemental Disclosure for Cash Flow Information:
Cash payments for:
Income taxes paid	$	0		$	0
Interest paid	$	1,000		$	0

See accompanying notes to the condensed financial statements

GEORGE RISK INDUSTRIES, INC.

NOTES TO CONDENSED FINANCIAL STATEMENTS

~~JANUARY~~JULY 31, 2018

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 condensed financial statements be read in conjunction with the financial statements and notes thereto included in the Company’s April 30, ~~2017~~2018 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~~Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update No. 2014-09, ~~Revenue~~“Revenue from Contracts with ~~Customers. The objective~~Customers (Topic 606)” (“ASU 2014-09”), which requires an entity to recognize revenue to depict the transfer of ~~this update is~~promised goods or services to ~~provide a robust framework~~customers in an amount that reflects the consideration to which it expects to be entitled in exchange for ~~addressing~~those goods or services. In addition, ASU No. 2014-09 requires disclosures of the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. ASU No. 2014-09 supersedes most existing U.S. GAAP revenue recognition ~~issues~~principles, and ~~upon its effective date, replaces almost all existing revenue recognition guidance. This update~~it permits the use of either the retrospective or cumulative effect transition method. ASU No. 2014-09 is effective infor annual reporting periods beginning after December 15, 2017, ~~and the~~including interim periods within ~~that year.~~those annual periods. The Company ~~is evaluating~~has adopted ASU No. 2014-09 in the ~~impact~~first quarter of ~~this update~~fiscal 2019, which does not have a material impact on the Company’s financial ~~statements.~~statements and related disclosures.

In February of 2016, the FASB issued ASU 2016-02,~~Leases~~ “Leases (Topic 842)” (“ASU 2016-02”), which provides guidance for accounting for leases. ASU 2016-02 requires lessees to classify leases as either finance or operating leases and to record a right-of-use asset and a lease liability for all leases with a term greater than 12 months regardless of the lease classification. The lease classification will determine whether the lease expense is recognized based on an effective interest rate method or on a straight-line basis over the term of the lease. Accounting for lessors remains largely unchanged from current GAAP. ASU 2016-02 is effective for the Company beginning November 1, 2019. Early adoption is permitted. In July 2018, the FASB issued ASU No. 2018-10 “Codification Improvements to Topic 842, Leases” (“ASU 2018-10”) and ASU No. 2018-11 “Leases (Topic 842) Targeted Improvements” (“ASU 2018-11”). ~~Under~~ASU 2018-10 provides certain amendments that affect narrow aspects of the guidance issued in ASU 2016-02. ASU 2018-11 allows all entities adopting ASU 2016-02 to choose an additional (and optional) transition method of adoption, under which an entity initially applies the new ~~guidance, lessees~~leases standard at the adoption date and recognizes a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption. ASU 2018-11 also allows lessors to not separate non-lease components from the associated lease component if certain conditions are met. The Company will ~~be required to recognize so-called right-of-use assets and liabilities for most leases having lease terms~~adopt the ASUs in the first quarter 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~~Company’s accounting systems will be upgraded to comply with the ~~impact~~requirements of ~~this update~~the new standard, however, the adoption of ASU 2016-02 will not have a material impact on the Company’s financial ~~statements.~~

statements and related disclosures.

In February of 2018, the FASB issued ASU No. 2018-02, Reclassification of Certain Tax Effects from Accumulated Other Comprehensive ~~Income.~~Income (ASU 2018-02). Under ~~this update, companies have~~existing U.S. GAAP, the ~~option~~effects of changes in tax rates and laws on deferred tax balances are recorded as a component of income tax expense in the period in which the law was enacted. When deferred tax balances related to ~~reclassify stranded~~items originally recorded in accumulated other comprehensive income (loss) are adjusted, certain tax effects ~~caused by US~~become stranded in accumulated other comprehensive income. The amendments in ASU 2018-02 allow a reclassification from accumulated other comprehensive income (loss) to retained earnings (accumulated deficit) for stranded income tax effects resulting from the Tax Cuts and Jobs Act ~~(TCJA) from accumulated other comprehensive income (AOCI) to retained earnings. Under current US GAAP, effects from a change~~(the Tax Act). The amendments in ~~tax law is recorded as a component of the~~this ASU also require certain disclosures about stranded 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 updateeffects. The guidance is effective ~~in annual reporting periods~~for fiscal years beginning after December 15, 2018, and ~~the~~ interim periods ~~starting thereafter.~~within those fiscal years. Early adoption in any period is permitted. The Company has not yet adopted ASU 2018-02 and is currently evaluating the potential impact of ~~this update~~adopting the applicable guidance on the Company’s financial ~~statements.~~statements and related disclosures.

In July 2018, the FASB issued ASU No. 2018-09, “Codification Improvements” (“ASU 2018-09”). ASU 2018-09 provides amendments to a wide variety of topics in the FASB’s Accounting Standards Codification, which applies to all reporting entities within the scope of the affected accounting guidance. The transition and effective date guidance are based on the facts and circumstances of each amendment. Some of the amendments in ASU 2018-09 do not require transition guidance and were effective upon issuance of ASU 2018-09. However, many of the amendments do have transition guidance with effective dates for annual periods beginning after December 15, 2018. We are currently evaluating the potential impact of adopting the applicable guidance, however we do not believe that the adoption of ASU 2018-09 will have a material impact on the Company’s financial statements and related disclosures.

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 if effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. Early adoption is permitted for any removed or modified disclosures. The Company is currently assessing the timing and impact of adopting the updated provisions.

Note 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.~~markets. 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 ~~June~~August 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 ~~January~~July 31, 2018 and April 30, ~~2017,~~2018, investments consisted of the following:

			Gross		Gross							Gross		Gross
Investments at	Cost		Unrealized		Unrealized			Fair		Cost		Unrealized		Unrealized			Fair
January 31, 2018	Basis		Gains		Losses			Value
July 31, 2018										Basis		Gains		Losses			Value
Municipal bonds	$	5,966,000	$	103,000	$	(238,000	)	$	5,831,000	$	5,917,000	$	65,000	$	(99,000	)	$	5,883,000
Corporate bonds	$	129,000	$	2,000	$	—		$	131,000	$	30,000	$	1,000	$	-		$	31,000
REITs	$	110,000	$	5,000	$	(6,000	)	$	109,000	$	110,000	$	11,000	$	(3,000	)	$	118,000
Equity securities	$	15,720,000	$	4,844,000	$	(203,000	)	$	20,361,000	$	16,103,000	$	4,105,000	$	(270,000	)	$	19,938,000
Money markets and CDs	$	1,064,000	$	—	$	—		$	1,064,000	$	1,191,000	$	-	$	-		$	1,191,000
Total	$	22,989,000	$	4,954,000	$	(447,000	)	$	27,496,000	$	23,351,000	$	4,182,000	$	(372,000	)	$	27,161,000

			Gross		Gross							Gross		Gross
Investments at	Cost		Unrealized		Unrealized			Fair		Cost		Unrealized		Unrealized			Fair
April 30, 2017	Basis		Gains		Losses			Value
April 30, 2018										Basis		Gains		Losses			Value
Municipal bonds	$	6,045,000	$	90,000	$	(97,000	)	$	6,038,000	$	5,984,000	$	66,000	$	(309,000	)	$	5,741,000
Corporate bonds	$	129,000	$	1,000	$	—		$	130,000	$	129,000	$	2,000	$	—		$	131,000
REITs	$	64,000	$	13,000	$	(1,000	)	$	76,000	$	110,000	$	3,000	$	(7,000	)	$	106,000
Equity securities	$	15,259,000	$	2,441,000	$	(319,000	)	$	17,381,000	$	15,930,000	$	3,714,000	$	(311,000	)	$	19,333,000
Money markets and CDs	$	2,757,000	$	—	$	—		$	2,757,000	$	1,035,000	$	—	$	—		$	1,035,000
Total	$	24,254,000	$	2,545,000	$	(417,000	)	$	26,382,000	$	23,188,000	$	3,785,000	$	(627,000	)	$	26,346,000

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 did not need to record anany impairment ~~loss during~~losses for either of the ~~quarter, but did record a loss of $23,000 for the nine months~~quarters ended ~~January~~July 31, ~~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 nine months ended January~~2018 and July 31, 2017.

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

Unrealized Loss Breakdown by Investment Type at ~~January~~July 31, 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	$	702,000	$	(152,000	)	$	1,674,000	$	(86,000	)	$	2,376,000	$	(238,000	)	$	1,857,000	$	(9,000	)	$	1,211,000	$	(90,000	)	$	3,068,000	$	(99,000	)
REITs	$	56,000	$	(5,000	)	$	27,000	$	(1,000	)	$	83,000	$	(6,000	)	$	35,000	$	(3,000	)	$	—	$	—		$	35,000	$	(3,000	)
Equity securities	$	534,000	$	(35,000	)	$	590,000	$	(168,000	)	$	1,124,000	$	(203,000	)	$	1,269,000	$	(100,000	)	$	1,146,000	$	(170,000	)	$	2,415,000	$	(270,000	)
Total	$	1,292,000	$	(192,000	)	$	2,291,000	$	(255,000	)	$	3,583,000	$	(447,000	)	$	3,161,000	$	(112,000	)	$	2,357,000	$	(260,000	)	$	5,518,000	$	(372,000	)

Unrealized Loss Breakdown by Investment Type at April 30, ~~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	$	1,420,000	$	(19,000	)	$	1,292,000	$	(78,000	)	$	2,712,000	$	(97,000	)	$	702,000	$	(152,000	)	$	1,674,000	$	(86,000	)	$	2,376,000	$	(238,000	)
REITs	$	—	$	—		$	27,000	$	(1,000	)	$	27,000	$	(1,000	)	$	56,000	$	(5,000	)	$	27,000	$	(1,000	)	$	83,000	$	(6,000	)
Equity securities	$	983,000	$	(92,000	)	$	1,689,000	$	(227,000	)	$	2,672,000	$	(319,000	)	$	534,000	$	(35,000	)	$	590,000	$	(168,000	)	$	1,124,000	$	(203,000	)
Total	$	2,403,000	$	(111,000	)	$	3,008,000	$	(306,000	)	$	5,411,000	$	(417,000	)	$	1,292,000	$	(192,000	)	$	2,291,000	$	(225,000	)	$	3,583,000	$	(447,000	)

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 ~~January~~July 31, 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 ~~January~~July 31, ~~2018~~2018.

Note 3:Inventories

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

January 31, April 30,
2018 2017

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

~~Note 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 January 31,~~ 2018 consisted of the following:

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

	July 31, 2018			April 30, 2018

Raw materials	$	2,774,000		$	2,450,000
Work in process		483,000			444,000
Finished goods		489,000			463,000
		3,746,000			3,357,000
Less: allowance for obsolete inventory		(96,000	)		(90,000	)
Totals	$	3,650,000		$	3,267,000

Note 5:4: Business Segments

The following is financial information relating to industry segments:

Three months Nine months Three months Nine months
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 10,000 28,000 7,000 29,000
Other products 52,000 94,000 27,000 80,000
Corporate general 15,000 41,000 13,000 29,000
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

					July 31,
					2018		2017
Net revenue:
Security alarm products					$	2,150,000	$	1,798,000
Cable & wiring tools						679,000		—
Other products						600,000		450,000
Total net revenue					$	3,429,000	$	2,248,000

Income from operations:
Security alarm products					$	485,000	$	392,000
Cable & wiring tools						153,000		—
Other products						135,000		98,000
Total income from operations					$	773,000	$	490,000
	January 31, 2018		April 30, 2017
Identifiable assets:
Security alarm products		4,424,000		3,180,000	$	3,848,000	$	3,934,000
Cable & wiring tools						2,783,000		—
Other products		2,371,000		1,517,000		2,024,000		749,000
Corporate general		34,773,000		33,767,000		33,407,000		34,797,000
Total assets	$	41,568,000	$	38,464,000	$	42,062,000	$	39,480,000

Depreciation and amortization:
Security alarm products					$	10,000	$	8,000
Cable & wiring tools						31,000		—
Other products						27,000		21,000
Corporate general						15,000		12,000
Total depreciation and amortization					$	83,000	$	41,000

Capital expenditures:
Security alarm products					$	—	$	210,000
Cable & wiring tools						—		—
Other products						—		—
Corporate general						—		43,000
Total capital expenditures					$	—	$	253,000

Note 6:5: 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 January 31, 2018
Income Shares Per-share
(Numerator) (Denominator) Amount
Net Income $ 791,000

Basic EPS $ 791,000 4,969,013 $ 0.1592
Effect of dilutive securities:
Convertible preferred stock 0 20,500
Diluted EPS $ 791,000 4,989,513 $ 0.1585

	For the three months ended July 31, 2018
	Income		Shares		Per-Share
	(Numerator)		(Denominator)		Amount
Net income	$	617,000
Basic EPS	$	617,000		4,967,580	$	.1242
Effect of dilutive Convertible
Preferred Stock		–		20,500		(.0005	)
Diluted EPS	$	617,000		4,988,080	$	.1237

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

Basic EPS $ 2,032,000 4,955,725 $ 0.4100
Effect of dilutive securities:
Convertible preferred stock 0 20,500
Diluted EPS $ 2,032,000 4,976,225 $ 0.4083

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

	For the three months ended July 31, 2017
	Income		Shares		Per-Share
	(Numerator)		(Denominator)		Amount
Net income	$	518,000
Basic EPS	$	518,000		4,945,092	$	.1048
Effect of dilutive Convertible
Preferred Stock		–		20,500		(.0005	)
Diluted EPS	$	518,000		4,965,592	$	.1043

Note 7:6: 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 corporation. The Plan is intended to be qualified under Section ~~401(k)~~401 (k) of the Internal Revenue Code of 1986, as amended. Matching contributions by the Company of approximately $2,000 were paid during both the ~~quarters~~quarter ending ~~January~~July 31, 2018 and 2017, respectively. ~~Likewise, the Company paid matching contributions of approximately $8,000 during the nine-month period ending January 31, 2018 and $7,000 during the corresponding period the prior fiscal year.~~

Note 8:7: 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 ~~January~~July 31, 2018, our investments consisted of money markets, certificates of deposits (CDs), 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 ~~tables set~~table 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, 2018								Assets Measured at Fair Value on a Recurring Basis as of July 31, 2018
	Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3		Total
Assets:
Municipal Bonds	$	-	$	5,831,000	$	-	$	5,831,000	$	—	$	5,883,000	$	—	$	5,883,000
Corporate Bonds	$	131,000	$	-	$	-	$	131,000	$	31,000	$	—	$	—	$	31,000
REITs	$	-	$	109,000	$	-	$	109,000	$	—	$	118,000	$	—	$	118,000
Equity Securities	$	20,361,000	$	-	$	-	$	20,361,000	$	19,938,000	$	—	$	—	$	19,938,000
Money Markets and CDs	$	1,064,000	$	-	$	-	$	1,064,000	$	1,191,000	$	—	$	—	$	1,191,000
Total fair value of assets measured on a recurring basis	$	21,556,000	$	5,940,000	$	-	$	27,496,000	$	21,160,000	$	6,001,000	$	—	$	27,161,000

	Assets Measured at Fair Value on a Recurring Basis as of April 30, 2017								Assets Measured at Fair Value on a Recurring Basis as of April 30, 2018
	Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3		Total
Assets:
Municipal Bonds	$	—	$	6,038,000	$	—	$	6,038,000	$	—	$	5,741,000	$	—	$	5,741,000
Corporate Bonds	$	130,000	$	—	$	—	$	130,000	$	131,000	$	—	$	—	$	131,000
REITs	$	—	$	76,000	$	—	$	76,000	$	—	$	106,000	$	—	$	106,000
Equity Securities	$	17,381,000	$	—	$	—	$	17,381,000	$	19,333,000	$	—	$	—	$	19,333,000
Money Markets and CDs	$	2,757,000	$	—	$	—	$	2,757,000	$	1,035,000	$	—	$	—	$	1,035,000
Total fair value of assets measured on a recurring basis	$	20,268,000	$	6,114,000	$	—	$	26,382,000	$	20,499,000	$	5,847,000	$	—	$	26,346,000

Note 9:8 Subsequent Events

None

GEORGE RISK INDUSTRIES, INC.

PART I. FINANCIAL INFORMATION

Item 2.2: 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~~current 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.~~2018.

Executive Summary

The Company’s performance has ~~remained steady~~increased through the ~~three quarters,~~first quarter, both in comparison to the most recent prior quarter and prior quarter last year. The most recent prior quarter increase is mainly due to traditionally having improved sales when the weather gets warmer. The Company’s products are tied to the housing market and the summertime usually shows an uptick in sales. In comparing the prior-year quarter, management has finally learned more about and gotten proper training to employees for the new computer system. Opportunities include continuing to learn and grow with ~~increased sales, being offset~~our new computer system and to continue looking at businesses that might be a good fit to purchase. Also, we have new products that are scheduled to enter the marketplace by ~~increased cost~~the end of ~~sales,~~the calendar year. Challenges in the coming months include continuing to get product out to customers in a timelier manner and ~~greatly improved investment returns.~~to fill the stockroom with inventory to get back to shipping out core products the same day. This is ~~due to the continuation of our quality USA made products~~all with the ~~ability for customization,~~hopes of getting our ~~notable customer service,~~facilities running leaner and the purchase of the assets of Labor Saving Devices, Inc. New challenges the Company has endured over the nine months of this fiscal year include the continuation of training of our new software system, learning and incorporating the Labor Saving Devices product line, and dealing with some shortages and defects of raw materials.more profitable than ever before.

Results of Operations

	●	Net sales ~~were $3,260,000 for the quarter ended January 31, 2018, which is~~showed a ~~23.25%~~52.53% increase ~~from the corresponding quarter last year. Year-to-date net sales were $8,597,000 at January 31, 2018, which is a 4.92% increase from~~over the same period in the prior year. Management believes this is due to many reasons. Last year there were unexpected delays in our production flow due to the implementation of new computer software. Over the last ~~year. A significant part of growth in sales~~year, management has worked hard to learn about and train employees on the new computer system and production is running much smoother than a ~~direct result of the asset purchase of Labor Saving Devices~~year ago. There is still room for improvement and ~~having a new product line~~management continues to ~~sell as a result of the purchase. Also, our ongoing commitment~~strive to ~~outstanding customer service and customization of products are a few of the many reasons sales remained steady over the years.~~
		be better.
	●	Cost of goods sold ~~was 56.0%~~saw an increase from 48.71% of ~~net~~ sales ~~for~~in the ~~quarter ended January 31, 2018 and was 46.4% for the same quarter last year. Year-to-date cost of goods sold percentages were 50.4% for~~prior year, to 52.52% in the current ~~nine months and 47.6% for the corresponding nine months last year,~~quarter, which is just ~~slightly over~~outside of Management’s goal to keep labor and other manufacturing expenses within the ~~target~~range of ~~less than~~45 to 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. The increased cost of goods sold percentage is a reflection of having increased inventory levels due to ~~fall~~the purchase of the assets of Labor Saving Devices and to ~~return~~keep raw materials in stock to ~~normal~~accommodate for the increase in ~~the future.~~
		sales.
	●	Operating expenses have increased ~~by $146,000~~when comparing the current year quarter to the same quarter for the prior year, but the percentage in relation to net sales decreased to 24.93% for the quarter ~~and also increased by $118,000 for the nine-months~~ ended ~~January~~July 31, 2018 as compared to 29.49% for the corresponding ~~periods~~quarter last year. ~~These increased costs are primarily due~~The Company has been able to ~~increased new product development, increased commissions, and additional~~keep the operating expenses at less than 30% of net sales for many years now; however, the effects of paying for training ~~and maintenance fees on our~~of the new computer software and currently paying maintenance and support fees on two software platforms has added to these expenses.

	●	Income from operations for the quarter ended ~~January~~July 31, 2018 was at ~~$582,000~~$773,000, which is ~~an 18.02% decrease~~a 57.76% increase from the corresponding quarter last year, which had income from operations of $710,000. Income from operations for the nine months ended January 31, 2018 was at $1,973,000, which is a 7.20% decrease from the corresponding nine months last year, which had income from operations of $2,126,000.
		$490,000.
	●	Other income and expenses ~~are up when comparing to the current quarter and nine-month periods the prior year, with an increase of $115,000 in the current quarter and an increase of $115,000~~showed a $128,000 gain for the ~~current year-to-date.~~quarter ended July 31, 2018 as compared to a $248,000 gain for the quarter ended July 31, 2017. The ~~majority of activity in these accounts consists of investment~~decrease is primarily due to decreased dividend and interest ~~dividends, and gain or loss~~income, offset by increased losses on the sale of investments. With the continued growth in the performance of the stock market, decisions were made to sell holdings and take the realized gain and dividends and interest payments exceeded expectations and many of our holdings had additional and increased dividend payouts.

	●	~~Overall,~~Provision for income taxes showed an increase of $64,000, up from $220,000 in the quarter ended July 31, 2017 to $248,000 for the quarter ended July 31, 2018.
	●	In turn, net income for the quarter ended ~~January~~July 31, 2018 was ~~down $1,000, or 0.13%,~~$617,000, a 19.11% increase from the ~~same~~corresponding quarter last ~~year. Similarly,~~year, which showed net income ~~for the nine-month period ended January 31, 2018 was down $19,000, or 0.93%, from the same period in the prior year.~~
		of $518,000.
	●	Earnings per share for the quarter ended July 31, 2018 were $0.12 per common share and $0.10 per common share for the quarter ended ~~January~~July 31, ~~2018 were $0.16 per share and $0.41 per share for the year-to-date numbers. EPS for the quarter and nine months ended January 31, 2017 were also $0.16 per share and $0.41 per share, respectively.~~2017.

Liquidity and capital resources

~~Operating~~

	●	Net cash decreased $2,504,000 during the nine months ended January 31, 2018 as compared to an increase of $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.Operating

	●	Net cash increased $653,000 during the quarter ended July 31, 2018 as compared to an increase of $542,000 during the corresponding quarter last year.
	●	Accounts receivable ~~increased $636,000~~decreased $234,000 for the ~~nine months ended January~~quarter ending July 31, 2018 compared with a ~~$163,000~~$257,000 decrease for the same ~~period~~quarter last year. The ~~current year increase~~decrease in accounts receivable is ~~a result of improved sales and collections~~directly attributable to the Company’s ability to collect on accounts ~~receivable taking~~and to keep past due accounts to a ~~bit longer than normal. Management believes~~minimum. An analysis of accounts shows that ~~approximately $16,000 of accounts~~there were only 6.38% that were over 90 days ~~have a possibility of being uncollectible.~~
		at July 31, 2018.
	●	Inventories increased ~~$1,291,000~~$389,000 during the current ~~nine-month period~~quarter as compared to ~~an decrease of $426,000~~a $62,000 increase last ~~year,~~year. The bigger increase is primarily due to the ~~inventory purchased from~~fact that Labor Saving ~~Devices.~~
		Devices was purchased in October 2017 and there is a need to have more inventory on hand.
	●	~~Prepaid~~At the quarter ended July 31, 2018 there was a $166,000 decrease in prepaid expenses ~~saw~~and at July 31, 2017, there was a ~~$359,000 increase~~$63,000 decrease. The current decrease is a result of having raw materials that were previously prepaid for arrive on our dock during the current ~~nine months, primarily due to the prepayment of inventory the Company purchases. Likewise, the prior nine months showed a $48,000 increase in prepaid expenses.~~
		quarter.
	●	Income tax overpayment for the ~~nine months~~quarter ended ~~January~~July 31, 2018 ~~increased $221,000, as the overpayment also showed an increase of $43,000~~decreased $244,000, while there was a $208,000 decrease towards income tax payable for the ~~same period~~quarter ending July 31, 2017. The current decrease in income tax overpayment is a result of refining our estimates when taking the ~~prior year. The main reason~~new income tax law for ~~the current increase is that the Company expects to generate additional income with the asset acquisition that happened earlier this fiscal year.~~
		2018 into account and having increased sales.
	●	Accounts payable shows ~~increases~~an increase of $7,000 for ~~both nine-month periods at $239,000 and $20,000, respectively. The company~~the quarter ended July 31, 2018 compared to a decrease of $112,000 for the same quarter the year before, primarily due to timing issues. Management strives to pay all ~~invoices~~payables within terms, ~~and~~unless there is a problem with the ~~variance in increases is primarily due to the timing of receipt of products and payment of invoices.~~
		merchandise.
	●	Accrued expenses decreased ~~$127,000~~$172,000 for the current ~~nine-month period~~quarter as compared to a ~~$72,000~~$163,000 decrease for the ~~nine-month period~~quarter ended ~~January~~July 31, 2017.

Investing

	●	As for our investment activities, the Company ~~spent approximately $342,000 on acquisitions~~did not buy any fixed assets during the current fiscal quarter. In comparison with the corresponding quarter last year, there were purchases of property and equipment ~~for~~in the ~~current nine-month period, in comparison with the corresponding nine months last year, where there was activity of $146,000.~~

	●	~~As a result of the asset acquisition of Labor Saving Devices, Inc. (“LSDI”), a net~~ amount of $1,624,000 of intangible assets were bought, along with inventory and fixed assets. Since the acquisition took place in the current year, there was no cash towards this item for the same reporting period last year.
		approximately $253,000.
	●	Additionally, the Company continues to purchase marketable securities, which include municipal bonds and quality stocks. ~~During the nine-month period ended January 31, 2018 there was quite a bit of buy/sell activity in the investment accounts. Net cash~~Cash spent on purchases of marketable securities for the ~~nine-month period~~quarter ended ~~January~~July 31, 2018 was ~~$653,000~~$233,000 compared to ~~$668,000~~$224,000 spent induring the ~~prior nine-month period.~~quarter ended July 31, 2017. We continue to use “money manager” accounts for most stock transactions. By doing this, the Company gives an independent ~~third-party~~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~~Furthermore, the Company continues to purchase back common stock when the opportunity arises. For the ~~nine-month period~~quarter ended ~~January~~July 31, 2018, the Company purchased ~~$3,000~~$5,000 worth of treasury ~~stock. This is in comparison to $551,000~~stock, along with the $3,000 spent in the same ~~nine months~~ period 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 and these dividends were paid by October 31, 2017. As for the prior year numbers, dividend paid was $1,596,000 for the nine months ending January 31, 2017. A dividend of $0.35 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:

	Qtr ended		Qtr ended
	July 31, 2018		July 31, 2017
Working capital
(current assets – current liabilities)	$	36,894,000	$	36,500,000

Current ratio
(current assets / current liabilities)		18.760		21.955

Quick ratio
((cash + investments + AR) / current liabilities)		16.567		20.496

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~~its’ engineering department ~~continue~~perpetually work to develop enhancements to current 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 various stages of 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~~electrical listing 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 CC15~~high voltage current controller (CC-15) is complete and has ~~been submitted to U.L. for~~received UL approval for the US and Canada. ~~This~~The CC-15 series is 15-amps and will ~~allow us to manufacture several different versions. One is~~come in a ~~15-amp version~~variety of voltage configurations. Some examples that ~~would automatically turn on a whole room of lights. Another is a 220-volt version to~~these switches can be used ~~in international markets.~~
		for are appliance control, environmental control and lighting systems.
	●	~~We continue to work~~Work continues on high security switches. WeThey 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~~Research resumes on 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~~Their 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~~looking into 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~~Updated versions of our 200-36 &and 4532 series overhead door switch line up is ~~nearing completion with the new aluminum cases presently on order.~~complete and has been selling well. The modified versions, the 200-36UF and 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.

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~~Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update No. 2014-09, ~~Revenue~~“Revenue from Contracts with ~~Customers. The objective~~Customers (Topic 606)” (“ASU 2014-09”), which requires an entity to recognize revenue to depict the transfer of ~~this update is~~promised goods or services to ~~provide a robust framework~~customers in an amount that reflects the consideration to which it expects to be entitled in exchange for ~~addressing~~those goods or services. In addition, ASU No. 2014-09 requires disclosures of the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. ASU No. 2014-09 supersedes most existing U.S. GAAP revenue recognition ~~issues~~principles, and ~~upon its effective date, replaces almost all existing revenue recognition guidance. This update~~it permits the use of either the retrospective or cumulative effect transition method. ASU No. 2014-09 is effective infor annual reporting periods beginning after December 15, 2017, ~~and the~~including interim periods within ~~that year.~~those annual periods. The Company ~~is evaluating~~has adopted ASU No. 2014-09 in the ~~impact~~first quarter of ~~this update~~fiscal 2019, which does not have a material impact on the Company’s financial ~~statements.~~statements and related disclosures.

GEORGE RISK INDUSTRIES, INC.

PART I. FINANCIAL INFORMATION

Item 3. Quantitative and Qualitative Disclosures ~~about~~About Market Risk

~~Not applicable~~This disclosure does not apply.

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 ~~January~~July 31, 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~~continue to ~~improve our disclosure controls~~operate with a limited number of accounting and ~~procedures.~~financial personnel. A new accounting professional was hired in ~~October 2017~~2018 to fill the Controller ~~position. Regarding this filing, more~~position Once the controller is hired, 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 offor 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 ~~January~~July 31, 2018 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

GEORGE RISK INDUSTRIES, INC.

~~Part~~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 of common stock for the ~~third~~first quarter of fiscal year ~~2018.~~2019.

Period	Number of shares repurchased
~~November 1, 2017 – November 30, 2017~~		~~-0-~~
~~December 1, 2017 – December 31, 2017~~		~~-0-~~
~~January~~May 1, 2018 – ~~January~~May 31, 2018	400
June 1, 2018 – June 30, 2018	100
July 1, 2018 – July 31, 2018	150

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

~~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)

Date ~~March 16,~~September 14, 2018	By:	/s/ Stephanie M. Risk-McElroy
		Stephanie M. Risk-McElroy
		President, Chief Executive Officer, Chief Financial Officer and Chairman of the Board

	Three months			Nine months			Three months			Nine months
	ended			ended			ended			ended
	Jan 31, 2018			Jan 31, 2018			Jan 31, 2017			Jan 31, 2017
Net Sales	$	3,260,000		$	8,597,000		$	2,645,000		$	8,194,000
Less: Cost of Goods Sold		(1,826,000	)		(4,337,000	)		(1,229,000	)		(3,899,000	)
Gross Profit	$	1,434,000		$	4,260,000		$	1,416,000		$	4,295,000

Operating Expenses
General and Administrative		313,000			833,000			223,000			664,000
Sales		512,000			1,371,000			461,000			1,432,000
Engineering		22,000			69,000			17,000			59,000
Rent Paid to Related Parties		5,000			14,000			5,000			14,000
Total Operating Expenses	$	852,000		$	2,287,000		$	706,000		$	2,169,000

Income From Operations		582,000			1,973,000			710,000			2,126,000

Other Income (Expense)
Other		—			3,000			1,000			11,000
Dividend and Interest Income		376,000			811,000			332,000			650,000
Gain (Loss) on Investments		123,000			94,000			51,000			136,000
Gain (Loss) on Sale of Assets		—			4,000			—			—
	$	499,000		$	912,000		$	384,000		$	797,000

Income Before Provisions for Income Taxes		1,081,000			2,885,000			1,094,000			2,923,000

Provisions for Income Taxes:
Current Expense		281,000			852,000			313,000			896,000
Deferred Tax Expense (Benefit)		9,000			1,000			(11,000	)		(24,000	)
Total Income Tax Expense	$	290,000		$	853,000		$	302,000		$	872,000

Net Income	$	791,000		$	2,032,000		$	792,000		$	2,051,000

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

Income Per Share of Common Stock
Basic	$	0.16		$	0.41		$	0.16		$	0.41
Diluted	$	0.16		$	0.41		$	0.16		$	0.41

Weighted Average Number of Common
Shares Outstanding
Basic		4,969,013			4,955,725			4,945,972			4,996,453
Diluted		4,989,513			4,976,225			4,966,472			5,016,953

	January 31,			April 30,
	2018			2017

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

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

	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