Leases

12 Months Ended

Jun. 30, 2023

Leases [Abstract]

LEASES

Note 13. LEASES

The Company determines if a contract contains a lease at inception which is the date on which the terms of the contract are agreed to and the agreement creates enforceable rights and obligations. US GAAP requires that the Company’s leases be evaluated and classified as operating or finance leases for financial reporting purposes. The classification evaluation begins at the commencement date and the lease term used in the evaluation includes the non-cancellable period for which the Company has the right to use the underlying asset, together with renewal option periods when the exercise of the renewal option is reasonably certain and failure to exercise such option which result in an economic penalty. All of the Company’s leases are classified as operating leases.

The Company has several lease agreements with lease terms ranging from two to five years. As of June 30, 2023, ROU assets and lease liabilities amounted to $381,982 and $576,032 (including $330,861 from lease liabilities current portion and $245,171 from lease liabilities non-current portion), respectively and weighted average discount rate was approximately 10.61%.

The Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants. The leases generally do not contain options to extend at the time of expiration and the weighted average remaining lease terms are 2.15 years.

For the years ended June 30, 2023 and 2022, rent expense amounted to approximately $549,842 and $779,841, respectively.

Impairment loss amounted to $371,606 and $595,753 for the years ended June 30, 2023 and 2022.

The Company terminated several lease agreements and resulting in a gain on disposal of ROU assets of $177,970 for the years ended June 30, 2023.

The five-year maturity of the Company’s lease obligations is presented below:

Twelve Months Ending June 30,	Operating Lease Amount
2024	$	382,291
2025		147,149
2026		114,523
2027		9,567
Total lease payments		653,530
Less: Interest		77,498
Present value of lease liabilities	$	576,032