XML 30 R16.htm IDEA: XBRL DOCUMENT

Fair Value Measurements

9 Months Ended

Jun. 30, 2021

NOTE 9: FAIR VALUE MEASUREMENTS

The fair value of a financial instrument is the amount that could be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value hierarchy prioritizes the quality and reliability of the information used to determine fair values. Categorization within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. The fair value hierarchy is defined into the following three categories:

•Level 1 — Quoted market prices in active markets for identical assets or liabilities.

•Level 2 — Other observable market-based inputs or unobservable inputs that are corroborated by market data.

•Level 3 — Unobservable inputs that are not corroborated by market data.

We have elected not to measure at fair value any eligible items for which fair value measurement is optional.

There were no transfers in or out of Level 1, Level 2 or Level 3 for financial assets or liabilities measured at fair value on a recurring basis during the periods presented.

Fair Value Measurement on a Recurring Basis

As of June 30, 2021, June 30, 2020 and September 30, 2020, we did not have any financial assets or liabilities measured at fair value on a recurring basis.

Financial Assets and Liabilities Not Measured at Fair Value

The tables below present our estimates of fair value of financial assets and liabilities that were not measured at fair value on a recurring basis:


	Carrying Value		Estimated Fair Value
	June 30, 2021		June 30, 2021		Fair Value Measurement Using
(in thousands)					Level 1		Level 2		Level 3

Financial assets:
2.89% promissory note receivable due April 2024	$	1,173	$	1,173	$	—	$	—	$	1,173
Investments in unconsolidated affiliates	35,387		43,440		35,970		—		7,470

Financial liabilities:
2024 Convertible Notes	$	121,910	$	150,219	$	—	$	150,219	$	—
2025 Convertible Notes	138,722		154,129		—		154,129		—


	Carrying Value		Estimated Fair Value
	June 30, 2020		June 30, 2020		Fair Value Measurement Using
(in thousands)					Level 1		Level 2		Level 3

Financial assets:
Notes receivable from Grupo Finmart, net	$	3,866	$	3,945	$	—	$	—	$	3,945
2.89% promissory note receivable due April 2024	1,140		1,140		—		—		1,140
Investments in unconsolidated affiliates	29,483		33,602		25,779		—		7,823

Financial liabilities:
2024 Convertible Notes	$	115,681	$	130,669	$	—	$	130,669	$	—
2025 Convertible Notes	131,378		125,235		—		125,235		—
8.5% unsecured debt due 2024	998		998		—		—		998
CASHMAX secured borrowing facility	(171)		295		—		—		295


	Carrying Value		Estimated Fair Value
	September 30, 2020		September 30, 2020		Fair Value Measurement Using
(in thousands)					Level 1		Level 2		Level 3

Financial assets:
2.89% promissory note receivable due April 2024	$	1,148	$	1,148	$	—	$	—	$	1,148
Investments in unconsolidated affiliates	32,458		32,597		24,833		—		7,764

Financial liabilities:
2024 Convertible Notes	$	117,193	$	129,979	$	—	$	129,979	$	—
2025 Convertible Notes	133,164		137,569		—		137,569		—
8.5% unsecured debt due 2024	872		872		—		—		872

Due to the short-term nature of cash and cash equivalents, pawn loans, pawn service charges receivable and other debt, we estimate that the carrying value approximates fair value. We consider our cash and cash equivalents to be measured using Level 1 inputs and our pawn loans, pawn service charges receivable and other debt to be measured using Level 3 inputs. Significant increases or decreases in the underlying assumptions used to value pawn loans, pawn service charges receivable, consumer loans, fees and interest receivable and other debt could significantly increase or decrease these fair value estimates.

In March 2019, we received $1.1 million in previously escrowed seller funds as a result of settling certain indemnification claims with the seller of GPMX. In April 2019, we loaned the $1.1 million back to the seller of GPMX in exchange for a promissory note. The note bears interest at the rate of 2.89% per annum and is secured by certain marketable securities owned by the seller and held in a U.S. brokerage account. All principal and accrued interest is due and payable in April 2024. The note approximated its carrying value as of June 30, 2021.

We use the equity method of accounting to account for our 35.65% ownership in Cash Converters International. These inputs are comprised of (a) the quoted stock price on the Australian Stock Exchange multiplied by (b) the number of shares we owned multiplied by (c) the applicable foreign currency exchange rate as of the end of our reporting period. We included no control premium for owning a large percentage of outstanding shares.

We use the equity method of accounting to account for our 13.14% ownership in Rich Data Corporation, a previously consolidated variable interest entity for which we no longer have the power to direct the activities that most significantly affect its economic performance. We believe its fair value approximates carrying value although such fair value is highly variable and includes significant unobservable inputs.

We measured the fair value of the 2024 and 2025 Convertible Notes using quoted price inputs. The notes are not actively traded, and thus the price inputs represent a Level 2 measurement. As the quoted price inputs are highly variable from day to day, the fair value estimates disclosed above could significantly increase or decrease.

In September 2020, we received the final payment from AlphaCredit on the notes receivable related to the sale of Grupo Finmart and recorded the amount under “Restricted cash” in our consolidated balance sheet as of June 30, 2021. In August 2019, AlphaCredit notified us of an indemnity claim for certain pre-closing taxes, but the nature, extent and validity of such claim has yet to be determined.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References + Details