BASIS OF PRESENTATION

3 Months Ended

Sep. 30, 2023

Accounting Policies [Abstract]

BASIS OF PRESENTATION

NOTE 1. BASIS OF PRESENTATION 

The accompanying unaudited condensed consolidated financial statements of Pro-Dex, Inc. (“we,” “us,” “our,” “Pro-Dex,” or the “Company”) have been prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) for interim financial information and with the instructions to Form 10-Q and Regulation S-K. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. These financial statements should be read in conjunction with the financial statements presented in our Annual Report on Form 10-K for the fiscal year ended June 30, 2023. In the opinion of management, all adjustments considered necessary for a fair presentation have been included. The results of operations for such interim periods are not necessarily indicative of the results that may be expected for the full year. For further information, refer to the financial statements and footnotes thereto included in our Annual Report on Form 10-K for the year ended June 30, 2023.

Recently Adopted Accounting Pronouncements

In March 2022, the FASB issued Accounting Standards Update (“ASU”) No 2022-02 (Topic 326) Financial Instruments – Credit Losses to create a new model for credit losses that reflects current expected credit losses (“CECL”) over the lifetime of the underlying accounts receivable. The CECL methodology is applicable to our trade accounts receivable and our deferred costs. We adopted ASU 2022-02 effective July 1, 2023, and the adoption did not have a material impact on our financial statements for the three months ended September 30, 2023.

Correction of Previously Reported Interim Condensed Consolidated Financial Statements

As previously disclosed, the Company restated its 2023 financial statements, which were presented in Note 2 to the audited consolidated financial statements for Company’s fiscal year 2023 Form 10-K filed with the Securities and Exchange Commission (“SEC”) on October 13, 2023. The restatement corrected the error related to the understated fair value of the Monogram warrant. The restatement recorded the investment at its estimated fair value for all restated periods, recorded an unrealized gain on investments and recorded the deferred income tax expense associated with the corresponding unrealized gain on investments.

Presented below are the changes to each financial statement line item which changed as a result of the restatement.

First Quarter Fiscal 2023 Unaudited Income Statement – Three months ended September 30, 2022

	As Previously Reported		Restatement			As Restated
Unrealized gain(loss) on investments	$	250	$	175	(a)	$	425
Total other income (expense)		344		175			519
Income before income taxes		1,294		175			1,469
Income tax expense		218		48	(b)		266
Net income		1,076		127			1,203
Basic income per share	$	0.30	$	0.03		$	0.33
Diluted income per share	$	0.29	$	0.04		$	0.33

^(a) This amount represents the unrealized gain on the Monogram Warrant for the three months ended September 30, 2022.

^(b) This amount represents the income tax expense related to the unrealized gain on the Monogram Warrant for the three months ended September 30, 2022.