OPERATING AND FINANCING LEASES

6 Months Ended

Dec. 31, 2024

Operating And Financing Leases

OPERATING AND FINANCING LEASES

NOTE 4 – OPERATING AND FINANCING LEASES

The Company accounts for its various operating leases in accordance with Accounting Standards Codification (ASC) 842 – “Leases”, 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. The Company 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 December 31, 2024 is as follows:

Schedule of lessee operating leases liability maturity
Twelve Months Ending December 31,	Operating Lease Payments			Financing Lease Payments
2025	$	5,584		$	244
2026		5,388			244
2027		5,371			61
2028		5,019			—
2029		4,876			—
Thereafter		26,841			—
Present value discount		(14,893	)		(15	)
Total lease liability	$	38,186		$	534

Weighted Average Remaining Lease Term

Schedule of weighted average remaining lease term
Operating leases - years	10.6
Finance lease - years	2.1
Weighted Average Discount Rate
Operating leases	6.5	%
Finance lease	3.6	%

The components of lease expense were as follows:

Components of lease expense
	For the six months ended Dec.31,
	2024		2023
Operating lease cost	$	3,190	$	2,865
Finance lease cost:
Depreciation of leased equipment	$	100	$	100
Interest on lease liabilities		5		14
Total finance lease cost	$	105	$	114

Supplemental cash flow information related to leases was as follows:

Supplemental cash flow information related to leases
	For the six months ended Dec. 31,
Cash paid for amounts included in the measurement of lease liabilities:	2024		2023
Operating cash flows from operating leases	$	2,541	$	3,164
Financing cash flows from financing leases	$	122	$	122
Right-of-use and equipment assets obtained in exchange for lease obligations:
Operating leases	$	359	$	1,212