During the first quarter of fiscal 2020, we adopted ASU 2016-13, which replaces the incurred loss methodology for determining our provision for credit losses and allowance for credit losses with an expected loss methodology that is referred to as the CECL model, using the modified retrospective approach. Upon adoption, the total allowance for credit losses increased by $28.6 million, with no impact to the consolidated statement of operations.

The Company elected not to record an allowance for credit losses for accrued interest as outlined in ASC 326-20-30-5A. The accrual of interest is discontinued when a loan is 61 days or more past the contractual due date. When the interest accrual is discontinued, all unpaid accrued interest is reversed against interest income. While a loan is on nonaccrual status, interest revenue is recognized only when a payment is received. Once a loan moves to nonaccrual status, it remains in nonaccrual status until it is paid out, charged off or refinanced. During the three months ended June 30, 2020, the Company reversed a total of $5.5 million of unpaid accrued interest against interest income.

Based on the Company’s loan products, the purpose and the term, current payment performance is used to assess the capability of the borrower to repay contractual obligations of the loan agreements as scheduled. Current payment performance is monitored by management on a daily basis. On an as needed basis, qualitative information may be taken into consideration if new information arises related to the customer’s ability to repay the loan. The Company’s payment performance buckets are as follows: current, 30-60 days past due, 61-90 days past due, 91 days or more past due.


	Term Loans By Origination
Loans	Up to 1 Year Ago		Between 1 and 2 Years Ago		Between 2 and 3 Years Ago		Between 3 and 4 Years Ago		Between 4 and 5 Years Ago		More than 5 Years Ago		Total
Current	$	957,994,018	$	46,664,239	$	2,201,885	$	153,389	$	17,625	$	4,641	$	1,007,035,797
30 - 60 days past due	15,453,159		1,550,308		96,260		7,050		2,041		—		17,108,818
61 - 90 days past due	13,256,505		1,128,119		51,048		4,379		—		—		14,440,051
91 or more days past due	22,556,367		2,614,112		121,937		18,876		4,134		—		25,315,426
Total	$	1,009,260,049	$	51,956,778	$	2,471,130	$	183,694	$	23,800	$	4,641	$	1,063,900,092

	Term Loans By Origination
Tax advance loans	Up to 1 Year Ago		Between 1 and 2 Years Ago		Between 2 and 3 Years Ago		Between 3 and 4 Years Ago		Between 4 and 5 Years Ago		More than 5 Years Ago		Total
Current	$	465,904	$	3,067	$	—	$	—	$	—	$	—	468,971
30 - 60 days past due	296,041		1,375		—		—		—		—		297,416
61 - 90 days past due	1,927,745		2,548		—		—		—		—		1,930,293
91 or more days past due	1,275,015		5,517		—		—		—		—		1,280,532
Total	$	3,964,705	$	12,507	$	—	$	—	$	—	$	—	$	3,977,212
Total gross loans													$	1,067,877,304


	Term Loans By Origination
Loans	Up to 1 Year Ago		Between 1 and 2 Years Ago		Between 2 and 3 Years Ago		Between 3 and 4 Years Ago		Between 4 and 5 Years Ago		More than 5 Years Ago		Total
Current	$	941,717,290	$	39,951,920	$	1,523,994	$	44,213	$	3,569	$	—	$	983,240,986
30 - 60 days past due	19,851,436		1,600,053		69,688		7,225		—		—		21,528,402
61 - 90 days past due	17,035,849		1,572,299		61,315		7,630		1,009		—		18,678,102
91 or more days past due	30,655,472		8,832,508		816,134		124,626		19,221		4,641		40,452,602
Total	$	1,009,260,047	$	51,956,780	$	2,471,131	$	183,694	$	23,799	$	4,641	$	1,063,900,092

	Term Loans By Origination
Tax advance loans	Up to 1 Year Ago		Between 1 and 2 Years Ago		Between 2 and 3 Years Ago		Between 3 and 4 Years Ago		Between 4 and 5 Years Ago		More than 5 Years Ago		Total
Current	$	386,489	$	—	$	—	$	—	$	—	$	—	386,489
30 - 60 days past due	345,008		—		—		—		—		—		345,008
61 - 90 days past due	1,958,193		—		—		—		—		—		1,958,193
91 or more days past due	1,275,014		12,508		—		—		—		—		1,287,522
Total	$	3,964,704	$	12,508	$	—	$	—	$	—	$	—	$	3,977,212
Total gross loans													$	1,067,877,304

The allowance for credit losses is applied to amortized cost, which is defined as the amount at which a financing receivable is originated, and net of deferred fees and costs, collection of cash, and charge-offs. Amortized cost also includes interest earned but not collected.

Credit Risk is inherent in the business of extending loans to borrowers and is continuously monitored by management and reflected within the allowance for credit losses for loans. The allowance for credit losses is an estimate of expected losses inherent within the Company’s gross loans receivable portfolio. In estimating the allowance for credit losses, loans with similar risk characteristics are aggregated into pools and collectively assessed. The Company’s loan products have generally the same terms therefore the Company looked to borrower characteristics as a way to disaggregate loans into pools sharing similar risks.

Management estimates an allowance for each customer tenure bucket by performing a historical migration analysis of loans in that bucket for the twelve most recent historical twelve-month migration periods, adjusted for seasonality. All loans that are greater than 90 days past due on a recency basis and not written off as of the reporting date are reserved for at 100% of the outstanding balance, net of a calculated Rehab Rate. Management considers whether current credit conditions might suggest a change is needed to the allowance for credit losses by monitoring trends in 60-day delinquencies, FICO scores and average loan size as compared to metrics in the historical migration period. Due to the short term nature of the loan portfolio, forecasted changes in macroeconomic variables such as unemployment do not have a significant impact on loans outstanding at the end of a particular reporting period. Therefore, management develops a reasonable and supportable forecast of losses by comparing the most recent 6-month loss curves as compared to historical loss curves to see if there are significant changes in borrower behavior that may indicate the historical migration rates should be adjusted. If an adjustment is made as a result of the forecast, then the Company has elected to immediately revert back to historical experience past the forecast period.

The fiscal 2021 provision includes a $4.6 million increase to the allowance for forecasted losses as a result of the economic impact of COVID-19 on loans originated during the quarter. This is in addition to an $8.3 million COVID-19 related increase to the allowance on April 1, 2020, to adjust forecast expected losses as required under CECL.


	Three months ended June 30,
	2020		2019
Beginning balance, prior to adopting ASC 326	$	96,487,856	$	81,519,624
Impact of ASC 326	28,628,369		—
Provision for credit losses	25,660,660		41,291,071
Charge-offs	(43,831,942)		(39,523,987)
Recoveries	5,741,654		4,066,379
Net charge-offs	(38,090,288)		(35,457,608)
Ending Balance	$	112,686,597	$	87,353,087

Loans are placed on nonaccrual status when management determines that the full payment of principal and collection of interest according to contractual terms is no longer likely. This occurs when the loan becomes 61 days or more past due on a contractual basis. When loans are placed on nonaccrual status, interest receivable is reversed against interest income recognized in the current period. Interest payments received thereafter are applied as a reduction of the remaining principal balance as long as doubt exists as to the ultimate collection of principal. Once a loan moves to nonaccrual status, it remains in nonaccrual status until it is paid out, written off or refinanced.


			Days Past Due - Recency Basis
Customer Tenure	Current		30 - 59		60 - 89		Over 90		Total Past Due		Total Loans
0 to 5 months	$	67,730,655	$	3,845,030	$	4,366,540	$	7,810,138	$	16,021,708	$	83,752,363
6 to 17 months	127,305,648		2,905,164		2,454,079		4,157,522		9,516,765		136,822,413
18 to 35 months	138,461,819		2,435,479		1,716,577		2,804,965		6,957,021		145,418,840
36 to 59 months	111,044,052		1,567,291		1,179,983		1,821,298		4,568,572		115,612,624
60+ months	562,493,625		6,355,853		4,722,872		8,721,502		19,800,227		582,293,852

Tax advance loans	468,970		297,416		1,930,293		1,280,533		3,508,242		3,977,212
Total gross loans	1,007,504,769		17,406,233		16,370,344		26,595,958		60,372,535		1,067,877,304
Unearned interest, insurance and fees	(258,126,112)		(4,459,535)		(4,194,137)		(6,813,974)		(15,467,646)		(273,593,758)
Total net loans	$	749,378,657	$	12,946,698	$	12,176,207	$	19,781,984	$	44,904,889	$	794,283,546

Percentage of period-end gross loans receivable			1.6%		1.5%		2.5%		5.7%


			Days Past Due - Contractual Basis
Customer Tenure	Current		30 - 59		60 - 89		Over 90		Total Past Due		Total Loans
0 to 5 months	$	65,189,380	$	4,059,759	$	4,702,806	$	9,800,417	$	18,562,982	$	83,752,362
6 to 17 months	124,113,371		3,349,431		3,025,601		6,334,010		12,709,042		136,822,413
18 to 35 months	135,512,967		3,037,117		2,174,861		4,693,895		9,905,873		145,418,840
36 to 59 months	108,415,461		2,092,410		1,653,490		3,451,264		7,197,164		115,612,625
60+ months	550,009,807		8,989,685		7,121,344		16,173,016		32,284,045		582,293,852

Tax advance loans	386,489		345,008		1,958,193		1,287,522		3,590,723		3,977,212
Total gross loans	983,627,475		21,873,410		20,636,295		41,740,124		84,249,829		1,067,877,304
Unearned interest, insurance and fees	(252,008,669)		(5,604,041)		(5,287,088)		(10,693,960)		(21,585,089)		(273,593,758)
Total net loans	$	731,618,806	$	16,269,369	$	15,349,207	$	31,046,164	$	62,664,740	$	794,283,546

Percentage of period-end gross loans receivable			2.0%		1.9%		3.9%		7.9%

The following table presents the amortized cost basis of loans on nonaccrual status as of the beginning of the reporting period and the end of the reporting period and the amortized cost basis of nonaccrual loans without related expected credit loss. It also shows year-to-date interest income recognized on nonaccrual loans:


	Nonaccrual Financial Assets
Customer Tenure	As of June 30, 2020		As of March 31, 2020		Financial Assets 61 Days or More Past Due, Not on Nonaccrual Status		Nonaccrual Financial Assets With No Allowance as of June 30, 2020		Interest Income Recognized
0 to 5 months	$	19,210,705	$	26,040,593	$	—	$	—	$	685,262
6 to 17 months	13,445,952		17,466,450		—		—		756,414
18 to 35 months	10,647,059		13,723,295		—		—		630,127
36 to 59 months	7,816,047		10,071,288		—		—		488,763
60+ months	35,277,427		44,293,545		—		—		2,127,220

Tax advance loans	3,678,896		41,573		—		—		—
Unearned interest, insurance and fees	(23,077,796)		(28,510,140)		—		—
Total	$	66,998,290	$	83,126,604	$	—	$	—	$	4,687,786

Under the prior incurred loss methodology, loss contingencies were evaluated as: probable, reasonably possible, or remote. If, at the date of financial statement presentation, information was available that indicated an asset had been impaired and the amount of loss could be reasonably estimated, then an allowance for that loss could be recorded. Recording an allowance for a loss that was considered reasonably possible or remote was not permitted. With the adoption of ASC 326, the Company considers the lifetime potential for losses at the point of origination and records an allowance for that potential, at that point in time, removing the necessity of differentiation between the three loss contingency concepts and impairment. The following disclosures are presented under previously applicable GAAP.


March 31, 2020	Loans individually evaluated for impairment (impaired loans)		Loans collectively evaluated for impairment	Total

Gross loans in bankruptcy, excluding contractually delinquent	$	5,165,752	—	5,165,752
Gross loans contractually delinquent	70,719,727		—	70,719,727
Loans not contractually delinquent and not in bankruptcy	—		1,133,985,887	1,133,985,887
Gross loan balance	75,885,479		1,133,985,887	1,209,871,366
Unearned interest and fees	(16,848,762)		(292,131,962)	(308,980,724)
Net loans	59,036,717		841,853,925	900,890,642
Allowance for credit losses	(54,090,509)		(42,397,347)	(96,487,856)
Loans, net of allowance for credit losses	$	4,946,208	799,456,578	804,402,786


June 30, 2019	Loans individually evaluated for impairment (impaired loans)		Loans collectively evaluated for impairment	Total

Gross loans in bankruptcy, excluding contractually delinquent	$	4,898,870	—	4,898,870
Gross loans contractually delinquent	60,531,119		—	60,531,119
Loans not contractually delinquent and not in bankruptcy	—		1,157,266,256	1,157,266,256
Gross loan balance	65,429,989		1,157,266,256	1,222,696,245
Unearned interest and fees	(13,190,042)		(307,538,515)	(320,728,557)
Net loans	52,239,947		849,727,741	901,967,688
Allowance for losses	(47,549,279)		(39,803,808)	(87,353,087)
Loans, net of allowance for losses	$	4,690,668	809,923,933	814,614,601


	March 31, 2020		June 30, 2019
Credit risk
Consumer loans- non-bankrupt accounts	$	1,203,552,152	$	1,216,089,192
Consumer loans- bankrupt accounts	6,319,214		6,607,053
Total gross loans	$	1,209,871,366	$	1,222,696,245

Consumer credit exposure
Credit risk profile based on payment activity, performing	$	1,104,130,714	$	1,133,978,402
Contractual non-performing, 61 or more days delinquent ⁽¹⁾	105,740,652		88,717,843
Total gross loans	$	1,209,871,366	$	1,222,696,245

Credit risk profile based on customer type
New borrower	$	124,800,193	$	147,365,635
Former borrower	127,108,125		133,566,583
Refinance	935,448,882		920,783,881
Delinquent refinance	22,514,166		20,980,146
Total gross loans	$	1,209,871,366	$	1,222,696,245


	March 31, 2020			June 30, 2019
Contractual basis:
30-60 days past due	$	49,137,102		$	46,738,172
61-90 days past due	35,020,925			28,186,725
91 days or more past due	70,719,727			60,531,118
Total	$	154,877,754		$	135,456,015

Percentage of period-end gross loans receivable	12.8		%	11.1		%

Recency basis:
30-60 days past due	$	48,206,910		$	45,096,798
61-90 days past due	28,450,942			25,365,096
91 days or more past due	50,669,837			44,176,264
Total	$	127,327,689		$	114,638,158

Percentage of period-end gross loans receivable	10.5		%	9.4		%