OPERATING & FINANCING LEASES

12 Months Ended

Jun. 30, 2024

Operating Financing Leases

OPERATING & FINANCING LEASES

NOTE 6 – OPERATING & FINANCING LEASES

The Company accounts for its various operating leases in accordance with Accounting Standards Codification (‘ASC’) 842 – Lease, as updated by ASU 2016-02. At the inception of a lease, the Company recognizes right-of-use lease assets and related lease liabilities measured at present value of future lease payments on its balance sheet. Lease expense is recognized on a straight-line basis over the term of the lease. Our most common initial term varies in length from 2 to 19 years. Including renewal options negotiated with the landlord, we have a total span of 2 to 16 years at the facilities we lease. The Company reviewed its contracts with vendors and customers, determining that its right-to-use lease assets consisted of only office space operating leases. In determining the right-to-use lease assets and liabilities, the Company did recognize lease extension options which the Company feels would be reasonably exercised. Our incremental borrowing rate (“IBR”) used to discount the stream of operating lease payments is closely related to the interest rates available to the Company. A reconciliation of operating and financing lease payments undiscounted cash flows to lease liabilities recognized as of June 30, 2024 is as follows:

Year Ending June 30,		Operating Lease Payments			Financing Lease Payments
	2025	$	5,895,014		$	244,343
	2026		5,561,968			244,343
	2027		5,226,352			162,897
	2028		5,194,655			—
	2029		4,865,285			—
	Thereafter		29,295,110			—
	Present value discount		(15,096,964	)		(31,074	)
	Total lease liability	$	40,941,420		$	620,509

Weighted Average Remaining Lease Term

Operating leases - years	11.0
Finance lease - years	2.6
Weighted Average Discount Rate
Operating leases	6.4	%
Finance lease	3.6	%

The components of lease expense were as follows:

	For Year Ended June 30,
	2024		2023
Operating lease cost	$	5,685,008	$	5,887,390
Finance lease cost:
Depreciation of leased equipment	$	198,881	$	198,881
Interest on lease liabilities		26,534		35,833
Total finance lease cost	$	225,415	$	234,714

Supplemental cash flow information related to leases was as follows:

	For Year Ended June 30,
Cash paid for amounts included in the measurement of lease liabilities:	2024		2023
Operating cash flows from operating leases	$	6,363,561	$	5,577,578
Financing cash flows from financing leases	$	244,344	$	244,344
Right-of-use and equipment assets obtained in exchange for lease obligations:
Operating leases	$	3,715,138	$	2,902,584