DISCONTINUED OPERATIONS

12 Months Ended

Jun. 30, 2021

Discontinued Operations and Disposal Groups [Abstract]

Disposal Groups, Including Discontinued Operations, Disclosure [Text Block]

NOTE 3. DISCONTINUED OPERATIONS

USCAN entered into a binding letter of intent dated December 30, 2019, with Galileo whereby Galileo, pursuant to a capital restructuring, agreed to repurchase all of its common shares owned by USCAN for $1.0 million (Canadian). The transaction was subject to the approval of Canadian securities regulatory authorities and to the satisfaction of other closing conditions. The transaction closed effective March 2, 2020. Proceeds of approximately $746,000 were received (the equivalent of $1.0 million Canadian), and a realized gain of approximately $151,000 was recorded. In addition, approximately $228,000 in foreign currency loss was released from accumulated other comprehensive income (loss) into fiscal year 2020 realized foreign currency loss upon closing the sale.

After the transaction, the Company has not and will not have continuing involvement with the operations of Galileo, except for an equity method investment in a fund managed by Galileo. See further information on this equity method investment in Note 4, Investments.

The results of Galileo through the March 2, 2020, closing date are reflected as “discontinued operations” in the Consolidated Statements of Operations and are therefore, excluded from continuing operations results. Operations of Galileo had previously been presented as the separate business segment of Investment Management Services – Canada.

There were no assets or liabilities classified as discontinued operations at June 30, 2021, or June 30, 2020.

Receivables of Galileo included advisory fees owed to Galileo by the funds and clients it manages. Galileo fixed assets, consisting of furniture, equipment and leasehold improvements, were depreciated over 2 to 5 years. Galileo had leases for office equipment and facilities. See further information on these leases in Note 8, Leases.

The components of income (loss) from discontinued operations were as follows. Note that amounts in fiscal year 2020 are through the March 2, 2020, closing date of sale.

	Year Ended June 30,
(dollars in thousands)	2021		2020
Revenues
Advisory fees	$	-	$	235
Expenses
Employee compensation and benefits		-		77
General and administrative		-		508
Depreciation and amortization		-		6
		-		591
Other Income (Loss)
Investment income		-		24
Other loss		-		(6	)
		-		18
Loss from discontinued operations of investment management services in Canada before income taxes		-		(338	)
Tax expense (benefit)		-		-
Loss from discontinued operations of investment management services in Canada		-		(338	)
Less: net loss attributable to non-controlling interest from discontinued operations		-		(118	)
Net loss attributable to U.S. Global Investors, Inc. from discontinued operations of investment management services in Canada	$	-	$	(220	)

Galileo provides advisory services for clients in Canada and receives advisory fees based on the agreed-upon percentages of AAUM or assets under management, depending on contractual terms. Galileo investment advisory agreements have a single performance obligation, since the promised services are not separately identifiable from other promises in the agreements and, therefore, are not distinct. Galileo may also receive performance fees from certain clients when market appreciation or realized net gains exceeds established benchmarks on an annual or quarterly basis. Performance fees, which were included in advisory fees in the table above, were recognized when it was determined that they were no longer probable of significant reversal. Galileo recorded no performance fees for the year ended June 30, 2020. Galileo may, at its discretion, waive and absorb some of its clients’ operating expenses. The amount of fund expenses waived and absorbed was $39,000 for the year ended June 30, 2020.