Note 21 - Leases

6 Months Ended

Dec. 31, 2021

Notes to Financial Statements

Lessor, Operating Leases [Text Block]

21.  LEASES

Company as Lessor

Operating leases where we are lessor arise from the leasing of the Company’s commercial and residential real estate investment property. Initial lease terms generally range from 12 to 60 months. Depreciation expense for assets subject to operating leases is taken into account primarily on the straight-line method over a period of twenty years in amounts necessary to reduce the carrying amount of the asset to its estimated residual value. Depreciation expenses relating to the property held as investments in operating leases was $18 for both the 3 months ended December 31, 2021 and December 31, 2020. Depreciation expenses relating to the property held as investments in operating leases amounted to $36 for both 6 months ended December 31, 2021, and December 31, 2020.

Future minimum rental income in China and Thailand to be received from fiscal year 2022 to fiscal year 2023 on noncancelable operating leases is contractually due as follows as of December 31, 2021:

Remainder of fiscal 2022	$	74
Fiscal 2023		8
	$	82

Future minimum rental income in China and Thailand to be received from fiscal year 2022 to fiscal year 2023 on noncancelable operating leases is contractually due as follows as of June 30, 2021:

Fiscal 2022	$	145
Fiscal 2023		16
	$	161

Sales-type leases under which the Company is the lessor arise from the lease of four units of chiller systems. The Company classifies its lease arrangements at inception of the arrangement. The lease term is 3 years, contains an automatic transfer of title at the end of the lease term and a guarantee of residual value at the end of the lease term. The customer is required to pay for executory cost such as taxes.

Financing receivables, consisting of net investment in sales-type leases and receivables from financed sales of four units of chiller systems are as follows:

Components of Lease Balances	December 31,
	2021
Assets
Gross financial sales receivable	$	55
Unearned finance income		(5	)
Financed sales receivable	$	50
Net financed sales receivables due within one year	$	21
Net financed sales receivables due after one year	$	29

As of December 31, 2021, the financed sale receivables had a weighted average effective interest rate of 13.2% and weighted average remaining lease term of 2.5 years.

Company as Lessee

The Company is the lessee under operating leases for corporate offices and research and development facilities with remaining lease terms of one year to three years and finance leases for plant and equipment.

Supplemental balance sheet information related to leases was as follows (in thousands):

	Dec. 31, 2021 (Unaudited)			June 30, 2021
Finance Leases (Plant and Equipment)
Plant and equipment, at cost		1,825			1,413
Accumulated depreciation		(1,126	)		(1,199	)
Plant and Equipment, Net		699			214
Current portion of finance leases		163			197
Net of current portion of finance leases		178			253
Total Finance Lease Liabilities		341			450
Operating Leases (Corporate Offices, Research and Development Facilities)
Operating lease right-of-use assets		2,699			1,876
Current portion of operating leases		845			672
Net of current portion of operating leases		1,857			1,204
Total Operating Lease Liabilities		2,702			1,876

	Three Months Ended				Six Months Ended
	Dec. 31,		Dec. 31,		Dec. 31,			Dec. 31,
	2021		2020		2021			2020
	(Unaudited)		(Unaudited)		(Unaudited)			(Unaudited)
Lease Cost
Finance lease cost:
Interest on finance lease	$	5	$	8	$	11	$	20
Amortization of right-of -use assets		62		63		90		125
Total finance lease cost		67		71		101		145
Operating Lease Costs	$	231	$	189	$	470	$	375

Other information related to leases was as follows (in thousands except lease term and discount rate):

	Six months ended			Six months ended
	Dec. 31,			Dec. 31,
	2021			2020
	(Unaudited)			(Unaudited)
Cash Paid for Amounts Included in the Measurement of Lease Liabilities
Operating cash flows from finance leases	$	13		$	19
Operating cash flows from operating leases		470			375
Right-of-Use Assets Obtained in Exchange for New Operating Lease Liabilities		-			847
Weighted-Average Remaining Lease Term:
Finance leases		2.69			3.31
Operating leases		3.57			2.97
Weighted-Average Discount Rate:
Finance leases		3.50	%		3.36	%
Operating leases		4.81	%		4.72	%

As of December 31, 2021, the maturities of the Company's operating and finance lease liabilities are as follow:

	Operating Lease Liabilities			Finance Lease Liabilities
Fiscal Year
Remainder of 2022		516			173
2023		805			114
2024		566			76
2025		565			4
2026		444			-
Thereafter		73			-
Total future minimum lease payments		2,969			367
Less: amount representing interest		(267	)		(26	)
Present value of net minimum lease payments		2,702			341
Presentation on statement of financial position
Current		845			163
Noncurrent		1,857			178

As of June 30, 2021, future minimum lease payments under finance leases and noncancelable operating leases were as follows:

	Operating Lease Liabilities			Finance Lease Liabilities
Fiscal Year
2022		748			218
2023		537			137
2024		313			111
2025		291			22
Thereafter		156			-
Total future minimum lease payments		2,045			488
Less: amount representing interest		(169	)		(38	)
Present value of net minimum lease payments		1,876			450
Presentation on statement of financial position
Current		672			197
Noncurrent		1,204			253