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Basis of Presentation, Restatement of Financial Statement And Summary Of Significant Accounting Policies (Policy)
6 Months Ended
Dec. 31, 2024
Basis of Presentation, Restatement of Financial Statement And Summary Of Significant Accounting Policies [Abstract]  
Unaudited Interim Financial Information
Unaudited Interim Financial Information
The accompanying
 
unaudited condensed
 
consolidated financial
 
statements include
 
all majority-owned
 
subsidiaries over
 
which
the Company exercises
 
control and have been
 
prepared in accordance with
 
U.S. generally accepted accounting
 
principles (“GAAP”)
and
 
the rules
 
and
 
regulations
 
of
 
the United
 
States Securities
 
and
 
Exchange
 
Commission
 
for
 
Quarterly Reports
 
on Form
 
10-Q
 
and
include all of
 
the information and
 
disclosures required
 
for interim financial
 
reporting. The results
 
of operations
 
for the three
 
and six
months ended December 31, 2024 and
 
2023, are not necessarily indicative
 
of the results for the full year.
 
The Company believes that
the disclosures are adequate to make the information presented not misleading.
These
 
unaudited
 
condensed
 
consolidated
 
financial
 
statements
 
should
 
be
 
read
 
in
 
conjunction
 
with
 
the
 
financial
 
statements,
accounting policies and financial notes thereto included in the
 
Company’s Annual Report on Form 10-K for the fiscal year ended June
30, 2024, except
 
as noted below,
 
there are no material
 
changes to significant
 
accounting policies. In
 
the opinion of management,
 
the
accompanying
 
unaudited
 
condensed
 
consolidated
 
financial
 
statements
 
reflect
 
all
 
adjustments
 
(consisting
 
only
 
of
 
normal
 
recurring
adjustments), which are necessary for a fair representation of financial
 
results for the interim periods presented.
 
References to “Lesaka” are references
 
solely to Lesaka Technologies,
 
Inc. References to the “Company” refer
 
to Lesaka and its
consolidated subsidiaries, collectively,
 
unless the context otherwise requires.
Restatement/Revision of Previously Issued Financial Statements
Restatement of Previously Issued Financial Statements
Subsequent to the issuance of
 
the Company’s unaudited condensed consolidated financial statements
 
for the three and six
 
months
ended
 
December
 
31, 2024,
 
the Company’s
 
management
 
determined
 
that the
 
Company
 
incorrectly
 
classified and
 
recorded
 
revenue
from the sale of
 
certain vouchers on an
 
agent basis instead of
 
as a principal due
 
to a misinterpretation of
 
the accounting implications
related
 
to
 
a
 
change
 
in
 
an
 
operating
 
process
 
with
 
its
 
supplier.
 
The
 
Company
 
understated
 
its
 
revenue
 
and
 
cost
 
of
 
goods
 
sold,
 
IT
processing, servicing and support by $
29.4
 
million and $
37.4
 
million in its unaudited condensed consolidated statement of operations
for the three and six months ended December 31, 2024, respectively.
The correction
 
of the misclassification
 
did not
 
impact the Company’s
 
basic and diluted
 
loss per share,
 
condensed consolidated
balance sheet as
 
of December 31,
 
2024, or its
 
unaudited condensed consolidated statements
 
of comprehensive (loss) income,
 
unaudited
condensed consolidated
 
statement of changes
 
in equity and unaudited
 
condensed consolidated statements
 
of cash flows
 
for the three
and six months ended December 31, 2024.
The
 
tables
 
below
 
present
 
the
 
impact
 
of
 
the
 
restatement
 
on
 
the
 
Company’s
 
unaudited
 
condensed
 
consolidated
 
statement
 
of
operations for the three and six months ended December 31, 2024:
Revision of Previously Issued Financial Statements
In
 
April
 
2025,
 
the
 
Company
 
identified
 
that
 
it
 
had
 
misclassified
 
certain
 
of
 
its
 
long-term
 
borrowings.
 
The
 
Company’s
 
CCC
Revolving Credit
 
Facility was
 
scheduled to
 
be repaid
 
in full
 
on November
 
2024, but
 
this has
 
been extended
 
to June
 
30, 2025.
 
The
Company incorrectly
 
classified amounts due
 
under its CCC
 
Revolving Credit
 
Facility as long-term
 
borrowings instead of
 
as current
portion
 
of
 
long-term
 
borrowings
 
in
 
its
 
unaudited
 
condensed
 
consolidated
 
balance
 
sheet
 
as
 
of
 
December
 
31,
 
2024,
 
and
 
its
 
audited
consolidated balance sheet as of June 30, 2024.
 
1.
 
Basis of Presentation, Restatement of Financial Statement
 
and Summary of Significant Accounting Policies (continued)
Revision of Previously Issued Financial Statements (continued
The table
 
below presents
 
the impact
 
of the
 
revision of
 
the Company’s
 
financial statements
 
as of
 
December 31,
 
2024 and
 
June
30, 2024:
The correction of the
 
misclassification did not impact
 
the Company’s audited consolidated statements
 
of operations, consolidated
statements of comprehensive (loss) income, consolidated statement of changes in equity,
 
or consolidated statements of cash flows for
the
 
year
 
ended
 
June
 
30,
 
2024
 
and,
 
except
 
as
 
noted
 
above,
 
the
 
Company’s
 
audited
 
balance
 
sheet
 
as
 
of
 
June
 
30,
 
2024.
 
The
misclassification did
 
not affect compliance
 
with any debt
 
covenants. The Company
 
assessed the materiality
 
of this error and
 
change
in presentation on
 
prior period consolidated
 
financial statements in
 
accordance with SEC
 
Staff Accounting
 
Bulletin (“SAB”) No.
 
99
“Materiality” and SAB No. 108, “Considering
 
the Effects of Prior
 
Year Misstatements when Quantifying Misstatements in the Current
Year
 
Financial Statements.”
 
Based on this
 
assessment, the Company
 
has concluded that
 
previously issued
 
financial statements
 
were
not materially misstated based upon overall considerations of both quantitative
 
and qualitative factors.
The effects of
 
both the restatement
 
relating to the
 
correction of the
 
misclassification of revenue
 
and the revision
 
relating to the
correction of the misclassification of long-term borrowings have
 
been corrected in all impacted tables and footnotes throughout these
condensed consolidated financial statements.
Recent Accounting Pronouncements Adopted
Recent accounting pronouncements adopted
In November 2023,
 
the Financial Accounting Standards
 
Board (“FASB”)
 
issued guidance regarding
Segment Reporting (Topic
280)
 
to
 
improve
 
reportable
 
segment
 
disclosure
 
requirements,
 
primarily
 
through
 
enhanced
 
disclosures
 
about
 
significant
 
segment
expenses. In addition, the
 
guidance enhances interim disclosure
 
requirements, clarifies circumstances in
 
which an entity can disclose
multiple
 
segment
 
measures
 
of
 
profit
 
or
 
loss,
 
provides
 
new
 
segment
 
disclosure
 
requirements
 
for
 
entities
 
with
 
a
 
single
 
reportable
segment, and contains
 
other disclosure requirements.
 
This guidance is effective
 
for the Company
 
beginning July 1,
 
2024 for its
 
year
ended June 30, 2025, and for interim periods commencing from July 1, 2025 (i.e. for the
 
quarter ended September 30, 2025).
Recent accounting pronouncements not yet adopted as of December 31, 2024
Recent accounting pronouncements not yet adopted
 
as of December 31, 2024
In
 
December
 
2023,
 
the
 
FASB
 
issued
 
guidance
 
regarding
Income
 
Taxes
 
(Topic
 
740)
 
to
 
improve
 
income
 
tax
 
disclosure
requirements. The guidance requires
 
entities, on an
 
annual basis, to
 
(1) disclose specific categories
 
in the income
 
tax rate reconciliation
and (2) provide additional information for reconciling items that meet a quantitative threshold (if
 
the effect of those reconciling items
is equal
 
to or
 
greater
 
than
 
five percent
 
of the
 
amount computed
 
by multiplying
 
pre-tax
 
income
 
or loss
 
by the
 
applicable
 
statutory
income tax rate). This guidance
 
is effective for the Company
 
beginning July 1, 2025. The Company
 
is currently assessing the impact
of this guidance on its financial statements and related disclosures.
In
 
November
 
2024,
 
the
 
FASB
 
issued
 
guidance
 
regarding
Income
 
Statement—Reporting
 
Comprehensive
 
Income—Expense
Disaggregation
 
Disclosures
(Subtopic
 
220-40)
 
which
 
requires
 
disaggregated
 
disclosure
 
of
 
income
 
statement
 
expenses
 
for
 
public
business entities. The guidance does not change the expense captions an
 
entity presents on the face of the income statement; rather,
 
it
requires
 
disaggregation
 
of
 
certain
 
expense
 
captions
 
into
 
specified
 
categories
 
in
 
disclosures
 
within
 
the
 
footnotes
 
to
 
the
 
financial
statements. This guidance is effective for the
 
Company beginning July 1, 2027. Early
 
adoption is permitted. The Company is
 
currently
assessing the impact of this guidance on its financial statements and related disclosures.