AKAO 2017 Annual Report

112 within the consolidated balance sheet that sum to the total of the same such amounts shown in the consolidated statements of cash flows (in thousands): Year Ended December 31, 2017 2016 2015 Cash and cash equivalents................................................................. $ 145,219 $ 118,964 $ 20,287 Restricted cash, current ..................................................................... 5,891 127 - Restricted cash, non-current.............................................................. 3,855 250 127 Total cash, cash equivalents, and restricted cash .............................. $ 154,965 $ 119,341 $ 20,414 In May 2017, the Company received $13.2 million of funding from the Gates Foundation from the Grant Funds and Gates Investment (see Note 1). The Letter Agreement restricts the Company’s use to expenditures that are reasonably attributable to the activities required to support the research projects funded by the Gates Foundation, including an allocation of overhead and administrative expenses. As of December 31, 2017 and 2016 the Company had $9.2 million and zero, respectively, of restricted cash related to the unspent cash provided by the Gates Foundation. The remaining restricted cash serves as collateral for the letters of credit provided as security deposits under the Company’s facility lease and expire approximately 90 days from the end of their respective lease terms. As of December 31, 2017 and 2016, the Company had $0.5 million and $0.4 million, respectively, of restricted cash, which relates to the Company’s facility leases. Segment Reporting Operating segments are identified as components of an enterprise about which separate discrete financial information is available for evaluation by the chief operating decision maker regarding resource allocation and assessing performance. The Company has one operating segment. Customer Concentration For the years ended December 31, 2017, 2016 and 2015, all of the Company’s revenue has been generated from funding pursuant to U.S. government contracts and a non-profit foundation grant. All contracts receivable relate to funding from U.S. government contracts. Concentration of Credit Risk Financial instruments that potentially subject the Company to a significant concentration of credit risk consist of cash, cash equivalents and short-term investments. Cash and cash equivalents are deposited in checking and money market accounts at one financial institution with balances that generally exceed federally insured limits. Management believes that the financial institution is financially sound, and, accordingly, minimal credit risk exists with respect to this financial institution. The Company’s investment policy limits investments to certain types of debt securities issued by the U.S. government, its agencies and institutions with investment-grade credit ratings and places restrictions on maturities and concentration by type and issuer. The Company is exposed to credit risk in the event of default by the institutions holding its cash and cash equivalents or issuing the debt securities. As of December 31, 2017 and 2016, the Company has not experienced any credit losses in such accounts or investments. Contracts Receivable Contracts receivable represent amounts owed to the Company under certain government contracts. The Company had no amounts reserved for doubtful accounts as of December 31, 2017 and 2016, as the Company expects full collection of the receivable balances. Property and Equipment, Net Property and equipment consist of office equipment, laboratory equipment, and leasehold improvements and are stated at cost, less accumulated depreciation and amortization. Depreciation is computed using the straight-line method over the estimated useful lives of the respective assets, generally three to seven years. Leasehold improvements are amortized over their estimated useful lives or the remaining lease term, whichever is shorter. Maintenance and repair costs are recorded as a component of operating expenses in the Company’s consolidated statement of operations when incurred.