Property and Equipment, net

6 Months Ended

Jun. 30, 2023

Property, Plant and Equipment [Abstract]

Property and equipment, net consists of the following:


		As of
	Estimated useful lives (Years)	June 30, 2023		December 31, 2022
Owned Assets:
Network equipment and computers	3-5	$	141,728	$	130,218
Software	2-5	99,828		88,487
Leasehold improvements	3-8	40,566		42,890
Office furniture and equipment	3-8	19,938		20,211
Motor vehicles	2-5	738		605
Buildings	30	970		961
Land	—	634		629
Capital work in progress	—	13,532		14,459
		317,934		298,460
Less: Accumulated depreciation and amortization		(224,764)		(216,132)
		93,170		82,328
Right-of-use assets under finance leases*:
Network equipment and computers		58		82
Leasehold improvements		611		1,013
Office furniture and equipment		435		662
Motor vehicles		802		742
		1,906		2,499
Less: Accumulated depreciation and amortization		(1,388)		(1,999)
		518		500
Property and equipment, net		$	93,688	$	82,828

*Depreciation on assets held under finance leases are computed using the straight-line method over the shorter of the assets estimated useful lives or the lease term.

Capital work in progress represents advances paid towards acquisition of property and equipment and costs incurred on internally developed software not yet ready to be placed in service.

During the three and six months ended June 30, 2023, there were no material changes in estimated useful lives of property and equipment during the ordinary course of operations.

The depreciation and amortization expense, excluding amortization of acquisition-related intangibles, recognized in the unaudited consolidated statements of income was as follows:


	Three months ended June 30,				Six months ended June 30,
	2023		2022		2023		2022
Depreciation and amortization expense	$	8,918	$	9,929	$	18,256	$	19,045

The effect of foreign exchange gain/(loss) upon settlement of cash flow hedges recorded under depreciation and amortization expense, was as follows:


	Three months ended June 30,				Six months ended June 30,
	2023		2022		2023		2022
Effect of foreign exchange gain/(loss)	$	(66)	$	(5)	$	(145)	$	62

Internally developed software costs, included under Software, was as follows:


	As of
	June 30, 2023		December 31, 2022
Cost	$	42,478	$	31,544
Less : Accumulated amortization	(20,540)		(16,134)
Internally developed software, net	$	21,938	$	15,410

The amortization expense on internally developed software recognized in the unaudited consolidated statements of income was as follows:


	Three months ended June 30,				Six months ended June 30,
	2023		2022		2023		2022
Amortization expense	$	2,425	$	1,549	$	4,400	$	2,582

As of June 30, 2023 and December 31, 2022, the Company believes no impairment exists because the long-lived asset's future undiscounted net cash flows expected to be generated exceeds its carrying value; however, there can be no assurance that long-lived assets will not be impaired in future periods. Determining whether an impairment has occurred typically requires various estimates and assumptions, including determining which undiscounted cash flows are directly related to the potentially impaired asset, the useful life over which cash flows will occur, their amount, the asset’s residual value, if any. It is reasonably possible that the judgments and estimates described above could change in future periods.