Note 7. Property and Equipment

Property and equipment are comprised of three categories: leasehold improvements, furniture and fixtures, and other operating equipment as of December 31, 2021 and 2020 as follows:

December 31, 

    

    

2021

    

2020

    

Useful Life

Leasehold improvements

$

11,225

$

8,357

 

Average 5-8 years

Furniture and fixtures

1,146

362

 

3-4 years

Other operating equipment

 

1,027

 

388

 

Maximum 5 years

 

13,398

 

9,107

Accumulated depreciation

 

(6,740)

 

(4,946)

 

  

Total property and equipment, net

$

6,658

$

4,161

 

  

Depreciation is computed using the straight-line method over the estimated useful lives of the related assets. Leasehold improvements are depreciated over the shorter of remaining lease term or economic useful life (which is on average 5-8 years).

The Company performed assessments of its property and equipment for impairment for the years ended December 31, 2021 and 2020 and based upon the results of the impairment tests, the Company recorded impairment expenses of approximately $90 and $4,954, respectively, which is included in “Impairment/disposal of assets” in the consolidated statements of operations and comprehensive loss.

During the years ended December 31, 2021 and 2020, the Company recorded $2,754 and $2,853, respectively, of depreciation expense.

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Historical Timeline

Fiscal YearFiled
2021Mar 31, 2022Showing above
2019Apr 20, 2020
2018Apr 1, 2019
2017Mar 29, 2018
2016Mar 30, 2017

About PP&E Disclosures

The PP&E disclosure details a company's physical asset base — land, buildings, machinery, and equipment — along with the depreciation methods and useful life assumptions that determine how these costs flow through the income statement. Capitalization policy thresholds reveal management's judgment on the boundary between expense and asset, directly affecting both reported earnings and asset values.

Key signals: changes in estimated useful lives or depreciation methods can materially shift reported earnings without any operational change. Compare capital expenditures against depreciation expense — when capex consistently trails depreciation, the asset base may be aging and underinvested. Watch for large asset impairments or write-downs that signal overvalued carrying amounts. Asset retirement obligations reveal future environmental or decommissioning costs that are often underappreciated. Compare PP&E intensity (PP&E-to-revenue) against industry peers to assess capital efficiency and competitive positioning.