Leases

6 Months Ended

Jun. 30, 2023

Leases

Leases

7.  Leases

Right of use assets are included in the consolidated balance sheet are as follows:

	June 30, 2023		December 31, 2022
Non-current assets
Right-of-use assets – finance leases, net of depreciation, included in Property and equipment	$	32,484	$	38,079
Right-of-use assets - operating leases, net of amortization	$	1,250,413	$	1,393,071

Lease costs consists of the following:  

	Six months ended June 30,
	2023		2022
Finance lease cost:
Amortization of right-of-use assets	$	5,595	$	5,595
Interest expense on finance lease liabilities		1,031		1,279
		6,626		6,874
Operating lease cost	$	173,644	$	199,539
Lease cost	$	181,301	$	206,413

Other lease information: 

	Six months ended June 30,
	2023			2022
Cash paid for amounts included in the measurement of lease liabilities
Operating cash flows from finance leases	$	(1,031	)	$	(1,279	)
Operating cash flows from operating leases		(173,644	)		(199,539	)
Financing cash flows from finance leases		(3,883	)		(3,661	)
Cash paid for amounts included in the measurement of lease liabilities	$	(178,558	)	$	(204,479	)
Weighted average lease term – finance leases		3 years and 4 months			4 years and 3 months
Weighted average remaining lease term – operating leases		3 years and 7 months			4 years and 7 months
Discount rate – finance leases		6.61	%		6.61	%
Discount rate – operating leases		4.64	%		4.64	%

Maturity of Leases

Finance lease liability

The amount of future minimum lease payments under finance leases as of June 30, 2023 is as follows:

  Schedule of Finance lease liability

	Amount
Remainder of 2023	$	4,915
2024		9,829
2025		9,829
2026		6,195
2027		1,707
		32,475
Imputed interest		(3,540	)
Total finance lease liability	$	28,935
Disclosed as:
Current portion	$	8,152
Non-Current portion		20,783
Lease liability	$	28,935

Operating lease liability

The amount of future minimum lease payments under operating leases are as follows:

 Schedule of Operating lease liability

	Amount
Remainder of 2023	$	175,033
2024		366,110
2025		384,416
2026		403,637
2027		33,771
Total undiscounted minimum future lease payments		1,362,967
Imputed interest		(9,970	)
Total operating lease liability	$	1,352,997
Disclosed as:
Current portion	$	311,266
Non-Current portion		1,041,731
Lease liability	$	1,352,997

Lessor Property

The Company’s wholly owned subsidiary CCH owns a property located at 3571 Muskoka Road, #169, Bala, on which the operations of the Canadian Rehab Clinic were located prior to disposal on February 14, 2017. The property is leased to the purchasers of the business of the Canadian Rehab Clinic, initially for a period of 5 years, which was renewed for an additional 5 years, with a further two 5 year renewal periods available to the lessee. The lessee has an option to acquire the property for CDN$10 million. The Company considers the likelihood of the option being exercised as remote at this time.

The Lease was considered in terms of ASC 842, Leases and determined to be an operating lease as the criteria for the lease to be a sales-type lease or a direct financing lease were not met, including the possibility of the lessee exercising the option to purchase the property being considered as remote.

The Company derived rental income of CDN$122,345 ($91,103) for the three months ended June 30, 2023 and CDN$243,288 ($180,522) for the six months ended June 30, 2023. The Company disposed of CCH on June 30, 2023, see Note 4 above.