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Goodwill And Intangible Assets, Net
 12 Months Ended
Jun. 30, 2023
Goodwill And Intangible Assets, Net [Abstract]  
Goodwill And Intangible Assets, Net
10.
 
GOODWILL AND INTANGIBLE
 
ASSETS,
 
net
Goodwill
Summarized below is the movement in the carrying value of goodwill
 
for the years ended June 30, 2023, 2022 and 2021:
Gross value
Accumulated
impairment
Carrying value
Balance as of July 1, 2020
$
63,194
$
(39,025)
$
24,169
Liquidation of subsidiaries
(2)
(26,629)
26,629
-
Foreign currency adjustment
(1)
6,384
(1,400)
4,984
Balance as of June 30, 2021
42,949
(13,796)
29,153
Acquisition of Connect (Note 3)
(3)
153,693
-
153,693
Foreign currency adjustment
(1)
(21,166)
977
(20,189)
Balance as of June 30, 2022
175,476
(12,819)
162,657
Impairment loss
-
(7,039)
(7,039)
Foreign currency adjustment
(1)
(22,857)
982
(21,875)
Balance as of June 30, 2023
$
152,619
$
(18,876)
$
133,743
(1) – The
 
foreign currency
 
adjustment represents
 
the effects
 
of the
 
fluctuations between the
 
South African Rand
 
and the Euro,
against the U.S. dollar on the carrying value.
(2) – The Company deconsolidated
 
the goodwill and accumulated impairment
 
related to entities it
 
substantially liquidated during
the year ended June 30, 2021.
(3) – Represents
 
goodwill arising from
 
the acquisition of
 
Connect and translated
 
at the foreign exchange
 
rate applicable on the
date the transaction became effective. This goodwill has been
 
allocated to the merchant reportable operating segment
.
Goodwill
 
associated
 
with
 
the
 
acquisition
 
of
 
Connect
 
represents the
 
excess
 
of
 
cost
 
over
 
the
 
fair
 
value
 
of
 
acquired
 
net assets.
Connect goodwill
 
is not deductible
 
for tax purposes.
 
See Note 3
 
for the allocation
 
of the purchase
 
price to the
 
fair value of
 
acquired
net assets.
Impairment loss
The Company assesses the carrying
 
value of goodwill for impairment
 
annually, or
 
more frequently,
 
whenever events occur and
circumstances change indicating
 
potential impairment. The Company
 
performs its annual impairment
 
test as at June 30 of
 
each year.
Except as discussed below,
no
 
goodwill has been impaired during the years ended June 30, 2023, 2022
 
and 2021, respectively.
Year ended
 
June 30, 2023 goodwill impairment loss
The Company
 
recognized an
 
impairment loss
 
of $
7.0
 
million as
 
a result
 
of its
 
annual impairment
 
analysis related
 
to goodwill
allocated
 
to
 
its
 
hardware/
 
software
 
support
 
business
 
within
 
its
 
merchant
 
operating
 
segment.
 
The
 
impairment
 
loss
 
resulted
 
from
 
a
reassessment
 
of
 
the
 
business’
 
growth
 
prospects
 
given
 
the
 
change
 
in
 
customer
 
demand
 
as
 
a
 
result
 
of
 
the
 
introduction
 
of
 
cheaper
hardware devices which incorporate
 
software widely adopted by our customers
 
customer-base, coupled with a challenging
 
economic
environment
 
in
 
South
 
Africa.
 
The
 
impairment
 
is
 
included
 
within
 
the
 
caption
 
impairment
 
loss
 
in
 
the
 
consolidated
 
statement
 
of
operations for the year ended June 30, 2023.
In order to determine the
 
amount of the goodwill
 
impairment, the estimated fair value
 
of our hardware/ software support business
assets and liabilities were compared to the carrying
 
value of its assets and liabilities.
 
The Company used a discounted cash flow model
in order
 
to determine
 
the fair
 
value of
 
the business.
 
Based on
 
this analysis,
 
the Company
 
determined that
 
the carrying
 
value of
 
the
business’ assets and liabilities exceeded their fair value at the reporting date.
In the event that there is a deterioration in the Company’s operating segments, or in any other of the Company’s
 
businesses, this
may lead to additional impairments
 
in future periods.
 
Furthermore, the difficulties of integrating acquired businesses
 
may be increased
by
 
the
 
necessity
 
of
 
integrating
 
personnel
 
with
 
disparate
 
business
 
backgrounds
 
and
 
combining
 
different
 
corporate
 
cultures.
 
The
Company also may not
 
be able to retain key
 
employees or customers of
 
an acquired business or realize
 
cost efficiencies or
 
synergies
or other
 
benefits that
 
it anticipated
 
when selecting
 
its acquisition
 
candidates. Acquisition
 
candidates may
 
have liabilities
 
or adverse
operating
 
issues that
 
the
 
Company
 
fails
 
to
 
discover
 
through
 
due
 
diligence
 
prior
 
to
 
the
 
acquisition.
 
These
 
factors
 
may
 
also
 
lead
 
to
additional impairments in future periods.
 
10.
 
GOODWILL AND INTANGIBLE
 
ASSETS,
 
net (continued)
Goodwill (continued)
Goodwill has been allocated to the Company’s
 
reportable segments as follows:
Consumer
Merchant
Carrying value
Balance as of July 1, 2020
$
-
$
24,169
$
24,169
Liquidation of subsidiaries
-
-
-
Foreign currency adjustment
(1)
-
4,984
4,984
Balance as of June 30, 2021
-
29,153
29,153
Acquisition of Connect (Note 3)
-
153,693
153,693
Foreign currency adjustment
(1)
-
(20,189)
(20,189)
Balance as of June 30, 2022
-
162,657
162,657
Impairment loss
-
(7,039)
(7,039)
Foreign currency adjustment
(1)
-
(21,875)
(21,875)
Balance as of June 30, 2023
$
-
$
133,743
$
133,743
(1) –
 
The foreign
 
currency adjustment
 
represents the
 
effects of
 
the fluctuations
 
between the
 
South African
 
rand and
 
the Euro,
against the U.S. dollar on the carrying value.
Intangible assets
Intangible assets acquired
Summarized below
 
is the
 
fair value
 
of intangible
 
assets acquired,
 
translated at
 
the exchange
 
rate applicable
 
as of
 
the relevant
acquisition dates, and the weighted-average amortization period:
Fair value as of
acquisition date
Weighted-average
amortization
period (in years)
Finite-lived intangible asset:
Acquired during the year ended June 30, 2022:
Connect – integrated platform
$
142,981
10
 
Connect – customer relationships
20,516
8
 
Connect –brands
$
15,987
10
Impairment loss
The Company
 
assesses the carrying
 
value of
 
intangible assets
 
for impairment
 
whenever events
 
occur or
 
circumstances change
indicating that the carrying amount of the intangible asset may not be recoverable.
No
 
intangible assets have been impaired during the
years ended June 30, 2023, 2022 and 2021, respectively.
Summarized below is the carrying value and accumulated amortization of the intangible assets as of June 30, 2023, and June 30,
2022:
As of June 30, 2023
As of June 30, 2022
Gross
carrying
value
Accumulated
amortization
Net
carrying
value
Gross
carrying
value
Accumulated
amortization
Net
carrying
value
Finite-lived intangible assets:
Customer relationships
(1)
$
24,978
$
(11,565)
$
13,413
$
26,937
$
(9,140)
$
17,797
Software, integrated
platform and unpatented
technology
(1)
110,906
(13,711)
97,195
127,785
(3,075)
124,710
FTS patent
 
2,034
(2,034)
-
2,352
(2,352)
-
Brands and trademarks
(1)
13,852
(2,863)
10,989
16,018
(1,823)
14,195
Total finite-lived
intangible assets
 
$
151,770
$
(30,173)
$
121,597
$
173,092
$
(16,390)
$
156,702
(1) 2022 balances include the intangible assets acquired as part of the
 
Connect acquisition in April 2022.
 
10.
 
GOODWILL AND INTANGIBLE
 
ASSETS,
 
net (continued)
Intangible assets (continued)
Carrying value and amortization of intangible assets (continued)
Aggregate
 
amortization
 
expense on
 
the finite-lived
 
intangible assets
 
for
 
the
 
years
 
ended June
 
30,
 
2023,
 
2022
 
and
 
2021,
 
was
approximately $
15.0
 
million, $
3.8
 
million and $
0.4
, respectively.
Future estimated annual amortization expense for the next five
 
fiscal years and thereafter, using the exchange rates that prevailed
on June
 
30, 2023, is
 
presented in the
 
table below.
 
Actual amortization
 
expense in future
 
periods could differ
 
from this estimate
 
as a
result of acquisitions, changes in useful lives, exchange rate fluctuations and other
 
relevant factors.
Fiscal 2023
$
14,362
Fiscal 2024
14,364
Fiscal 2025
14,364
Fiscal 2026
14,310
Fiscal 2027
14,278
Thereafter
49,919
Total future
 
estimated annual amortization expense
$
121,597