0000108385us-gaap:ConsumerPortfolioSegmentMemberus-gaap:PerformingFinancingReceivableMemberwrld:ContractualBasisMember2021-03-31

SECURITIES AND EXCHANGE COMMISSION


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT of 1934

Commission File Number: 000-19599


South Carolina						57-0425114
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification Number)


104 S Main Street
Greenville,	South Carolina	29601
(Address of principal executive offices)
(Zip Code)


(864)			298-9800
(registrant's telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol	Name of each exchange on which registered
Common Stock, no par value	WRLD	The NASDAQ Stock Market LLC (NASDAQ Global Select Market)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for shorter period than the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No ¨

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes x No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large Accelerated filer

☐

Accelerated filer

☒

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No x

The number of outstanding shares of the issuer’s common stock, no par value, as of ~~August 3,~~October 29, 2021 was ~~6,692,894.~~6,699,409.

WORLD ACCEPTANCE CORPORATION

Introductory Note: As used herein, the "Company," "we," "our," "us," or similar formulations include World Acceptance Corporation and each of its subsidiaries, unless otherwise expressly noted or the context otherwise requires that it include only World Acceptance Corporation. All references in this report to "fiscal 2022" are to the Company’s fiscal year ending March 31, 2022; all references in this report to "fiscal 2021" are to the Company's fiscal year ended March 31, 2021; and all references to "fiscal 2020" are to the Company’s fiscal year ended March 31, 2020.

GLOSSARY OF DEFINED TERMS

The following terms may be used throughout this Report, including consolidated financial statements and related notes.


Term			Definition
ASC			Accounting Standards Codification
ASU			Accounting Standards Update
CECL			Current Expected Credit Loss
CEO			Chief Executive Officer
CFO			Chief Financial Officer
CFPB			U.S. Consumer Financial Protection Bureau
Compensation Committee			Compensation and Stock Option Committee
Customer Tenure			The number of years since a customer was first serviced by the Company
DOJ			U.S. Department of Justice
EBITDA			Earnings before interest, taxes, depreciation, and amortization
ERISA			Employee Retirement Income Security Act
Exchange Act			Securities Exchange Act of 1934, as amended
FASB			Financial Accounting Standards Board
FICO			the Fair Isaac Corporation
G&A			General and administrative
GAAP			U.S. generally accepted accounting principles
IRS			U.S. Internal Revenue Service
LIBOR			London Interbank Offered Rate
Option Measurement Period			The 6.5 year performance period beginning on September 30, 2018 and ending on March 31, 2025 over which the Performance Options are eligible to vest, following certification by the Compensation Committee of achievement
PCD			Purchased Assets with Credit Deterioration
Performance Options			Performance-based stock options
Performance Share Measurement Period			The 6.5 year performance period beginning on September 30, 2018 and ending on March 31, 2025 over which the Performance Shares are eligible to vest, following certification by the Compensation Committee of achievement
Performance Shares			Service- and performance-based restricted stock awards
Rehab Rate			Percentage of 91 days or more delinquent that do not charge off
Restricted Stock			Service-based restricted stock awards
SEC			U.S. Securities and Exchange Commission
Service Options			Service-based stock options
TAL			Tax Advance Loan

PART I. FINANCIAL INFORMATION

WORLD ACCEPTANCE CORPORATION

CONSOLIDATED BALANCE SHEETS

(Unaudited)
June 30, 2021 March 31, 2021
ASSETS
Cash and cash equivalents $ 8,387,320 $ 15,746,454
Gross loans receivable 1,223,138,687 1,104,746,261
Less:
Unearned interest, insurance and fees (322,753,401) (279,364,584)
Allowance for credit losses (97,852,630) (91,722,288)
Loans receivable, net 802,532,656 733,659,389
Right-of-use asset (Note 6) 89,797,336 90,055,572
Property and equipment, net 24,457,334 26,340,037
Deferred income taxes, net 28,782,464 24,992,742
Other assets, net 38,865,715 31,423,134
Goodwill 7,370,791 7,370,791
Intangible assets, net 22,339,503 23,537,517
Assets held for sale (Note 2) 1,143,528 1,143,528
Total assets $ 1,023,676,647 $ 954,269,164

LIABILITIES & SHAREHOLDERS' EQUITY
Liabilities:
Senior notes payable $ 467,699,588 $ 405,007,500
Income taxes payable 12,407,028 11,575,861
Lease liability (Note 6) 89,871,852 91,718,075
Accounts payable and accrued expenses 48,227,317 41,040,287
Total liabilities 618,205,785 549,341,723
Commitments and contingencies (Notes 6 and 12) 0 0
Shareholders' equity:
Preferred stock, 0 par value Authorized 5,000,000, 0 shares issued or outstanding 0 0
Common stock, 0 par value Authorized 95,000,000 shares; issued and outstanding 6,693,703 and 6,805,294 shares at June 30, 2021 and March 31, 2021, respectively 0 0
Additional paid-in capital 261,446,129 255,590,674
Retained earnings 144,024,733 149,336,767
Total shareholders' equity 405,470,862 404,927,441
Total liabilities and shareholders' equity $ 1,023,676,647 $ 954,269,164

~~WORLD ACCEPTANCE CORPORATION~~

~~AND SUBSIDIARIES~~

~~CONSOLIDATED STATEMENTS OF OPERATIONS~~

Three months ended June 30,
2021 2020
Revenues:
Interest and fee income $ 109,174,715 $ 109,860,456
Insurance income, net and other income 20,484,663 14,006,346
Total revenues 129,659,378 123,866,802
Expenses:
Provision for credit losses 30,265,811 25,660,660
General and administrative expenses:
Personnel 46,232,123 44,622,023
Occupancy and equipment 13,606,977 13,181,506
Advertising 3,759,709 2,612,167
Amortization of intangible assets 1,214,784 1,382,128
Other 8,537,604 9,810,155
Total general and administrative expenses 73,351,197 71,607,979
Interest expense 5,501,072 5,561,877
Total expenses 109,118,080 102,830,516
Income before income taxes 20,541,298 21,036,286
Income taxes 4,770,470 5,526,637
Net income $ 15,770,828 $ 15,509,649
Net income per common share:
Basic $ 2.56 $ 2.26
Diluted $ 2.44 $ 2.24
Weighted average common shares outstanding:
Basic 6,158,486 6,867,457
Diluted 6,455,753 6,928,121

WORLD ACCEPTANCE CORPORATION

CONSOLIDATED STATEMENTS OF ~~SHAREHOLDERS' EQUITY~~OPERATIONS

Three months ended June 30, 2021
Common Stock
Shares Additional Paid-in Capital Retained Earnings Total Shareholders' Equity
Balances at March 31, 2021 6,805,294 $ 255,590,674 149,336,767 $ 404,927,441
Proceeds from exercise of stock options 23,494 1,808,854 — 1,808,854
Common stock repurchases (134,249) — (21,082,862) (21,082,862)
Restricted common stock expense under stock option plan, net of cancellations ($137,489) (836) 3,102,974 — 3,102,974
Stock option expense — 943,627 — 943,627
Net income — — 15,770,828 15,770,828
Balances at June 30, 2021 6,693,703 $ 261,446,129 144,024,733 $ 405,470,862

Three months ended June 30, 2020
Common Stock
Shares Additional Paid-in Capital Retained Earnings Total Shareholders' Equity
Balances at March 31, 2020 7,807,834 $ 227,214,577 184,748,490 $ 411,963,067
Proceeds from exercise of stock options 0 0 — 0
Common stock repurchases (326,298) — (19,451,287) (19,451,287)
Restricted common stock expense under stock option plan, net of cancellations ($119,865) (29,948) 3,417,000 — 3,417,000
Stock option expense — 1,046,735 — 1,046,735
Cumulative effect of adoption of ASC 326 — — (21,242,249) (21,242,249)
Net income — — 15,509,649 15,509,649
Balances at June 30, 2020 7,451,588 $ 231,678,312 159,564,603 $ 391,242,915


	Three months ended September 30,				Six months ended September 30,
	2021		2020		2021		2020

Revenues:
Interest and fee income	$	118,113,200	$	108,885,851	$	227,287,915	$	218,746,307
Insurance income, net and other income	19,713,684		15,555,201		40,198,347		29,561,547
Total revenues	137,826,884		124,441,052		267,486,262		248,307,854

Expenses:
Provision for credit losses	42,043,526		26,090,367		72,309,337		51,751,027
General and administrative expenses:
Personnel	45,745,551		46,832,893		91,977,674		91,454,916
Occupancy and equipment	12,934,959		13,515,468		26,541,936		26,696,974
Advertising	5,294,835		5,255,613		9,054,544		7,867,780
Amortization of intangible assets	1,245,545		1,286,118		2,460,329		2,668,246
Other	9,767,969		8,402,448		18,305,573		18,212,603
Total general and administrative expenses	74,988,859		75,292,540		148,340,056		146,900,519

Interest expense	6,713,653		5,892,790		12,214,725		11,454,667
Total expenses	123,746,038		107,275,697		232,864,118		210,106,213

Income before income taxes	14,080,846		17,165,355		34,622,144		38,201,641

Income taxes	1,640,754		3,766,735		6,411,224		9,293,372









Net income	$	12,440,092	$	13,398,620	$	28,210,920	$	28,908,269







Net income per common share:
Basic	$	2.04	$	2.01	$	4.61	$	4.27
Diluted	$	1.94	$	1.96	$	4.38	$	4.20
Weighted average common shares outstanding:
Basic	6,083,255		6,680,969		6,120,665		6,773,704
Diluted	6,413,079		6,853,425		6,434,211		6,890,265

WORLD ACCEPTANCE CORPORATION

CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY

(Unaudited)


	Three months ended September 30, 2021
	Common Stock
	Shares	Additional Paid-in Capital		Retained Earnings	Total Shareholders' Equity
Balances at June 30, 2021	6,693,703	$	261,446,129	144,024,733	405,470,862
Proceeds from exercise of stock options	87,628	6,873,724		—	6,873,724
Common stock repurchases	(61,187)	—		(10,029,661)	(10,029,661)
Restricted common stock expense under stock option plan, net of cancellations ($12,724)	3,996	3,342,974		—	3,342,974
Stock option expense	—	909,350		—	909,350

Net income	—	—		12,440,092	12,440,092
Balances at September 30, 2021	6,724,140	$	272,572,177	146,435,164	419,007,341


	Three months ended September 30, 2020
	Common Stock
	Shares	Additional Paid-in Capital		Retained Earnings	Total Shareholders' Equity
Balances at June 30, 2020	7,451,588	$	231,678,312	159,564,603	391,242,915
Proceeds from exercise of stock options	15,571	1,006,825		—	1,006,825
Common stock repurchases	(460,120)	—		(43,235,638)	(43,235,638)
Restricted common stock expense under stock option plan, net of cancellations ($90,720)	(4,959)	3,776,190		—	3,776,190
Stock option expense	—	1,086,239		—	1,086,239


Net loss	—	—		13,398,620	13,398,620
Balances at September 30, 2020	7,002,080	$	237,547,566	129,727,585	367,275,151


	Six months ended September 30, 2021
	Common Stock
	Shares	Additional Paid-in Capital		Retained Earnings	Total Shareholders' Equity
Balances at March 31, 2021	6,805,294	$	255,590,674	149,336,767	$	404,927,441
Proceeds from exercise of stock options	111,122	8,682,578		—	8,682,578
Common stock repurchases	(195,436)	—		(31,112,523)	(31,112,523)
Restricted common stock expense under stock option plan, net of cancellations ($150,213)	3,160	6,445,948		—	6,445,948
Stock option expense	—	1,852,977		—	1,852,977

Net income	—	—		28,210,920	28,210,920
Balances at September 30, 2021	6,724,140	$	272,572,177	146,435,164	$	419,007,341


	Six months ended September 30, 2020
	Common Stock
	Shares	Additional Paid-in Capital		Retained Earnings	Total Shareholders' Equity
Balances at March 31, 2020	7,807,834	$	227,214,577	184,748,490	$	411,963,067
Proceeds from exercise of stock options	15,571	1,006,825		—	1,006,825
Common stock repurchases	(786,418)	—		(62,686,925)	(62,686,925)
Restricted common stock expense under stock option plan, net of cancellations ($284,079)	(34,907)	7,193,190		—	7,193,190
Stock option expense	—	2,132,974		—	2,132,974
Cumulative effect of adoption of ASC 326	—	—		(21,242,249)	(21,242,249)


Net income	—	—		28,908,269	28,908,269
Balances at September 30, 2020	7,002,080	$	237,547,566	129,727,585	$	367,275,151

WORLD ACCEPTANCE CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)


		Three months ended June 30,					Six months ended September 30,
		2021		2020			2021		2020
Cash flow from operating activities:	Cash flow from operating activities:					Cash flow from operating activities:
Net income	Net income	$	15,770,828	$	15,509,649	Net income	$	28,210,920	$	28,908,269
Adjustments to reconcile net income to net cash provided by operating activities:	Adjustments to reconcile net income to net cash provided by operating activities:					Adjustments to reconcile net income to net cash provided by operating activities:

Loss on assets held for sale						Loss on assets held for sale	38,633		—
Amortization of intangible assets	Amortization of intangible assets	1,214,784		1,382,128		Amortization of intangible assets	2,460,329		2,668,246
Amortization of investment in historic tax credits	Amortization of investment in historic tax credits	977,846		434,096		Amortization of investment in historic tax credits	1,955,692		868,192
Amortization of debt issuance costs	Amortization of debt issuance costs	145,421		144,171		Amortization of debt issuance costs	301,996		315,015
Provision for credit losses	Provision for credit losses	30,265,811		25,660,660		Provision for credit losses	72,309,337		51,751,027
Depreciation	Depreciation	2,449,931		1,716,612		Depreciation	3,355,606		3,477,512

Loss on sale of property and equipment	Loss on sale of property and equipment	289,254		34,058		Loss on sale of property and equipment	337,181		34,058
Deferred income tax benefit		(3,789,722)		2,512,174
Deferred income tax expense (benefit)						Deferred income tax expense (benefit)	(9,255,272)		1,218,798
Compensation related to stock option and restricted stock plans, net of taxes and adjustments	Compensation related to stock option and restricted stock plans, net of taxes and adjustments	4,184,090		4,583,600		Compensation related to stock option and restricted stock plans, net of taxes and adjustments	8,449,138		9,610,243

Change in accounts:	Change in accounts:					Change in accounts:
Other assets, net	Other assets, net	(9,999,219)		2,545,580		Other assets, net	(5,887,792)		1,984,942
Income taxes payable	Income taxes payable	831,167		2,582,959		Income taxes payable	(3,317,691)		(242,285)
Accounts payable and accrued expenses	Accounts payable and accrued expenses	7,187,031		(5,266,403)		Accounts payable and accrued expenses	11,632,237		(20,387,516)
Net cash provided by operating activities	Net cash provided by operating activities	49,527,222		51,839,284		Net cash provided by operating activities	110,590,314		80,206,501
Cash flows from investing activities:	Cash flows from investing activities:					Cash flows from investing activities:
Increase in loans receivable, net	Increase in loans receivable, net	(98,996,207)		73,293,367		Increase in loans receivable, net	(239,168,631)		19,745,335

Net assets acquired from acquisitions, primarily loans	Net assets acquired from acquisitions, primarily loans	(142,870)		(4,776,558)		Net assets acquired from acquisitions, primarily loans	(9,631,112)		(5,786,847)
Increase in intangible assets from acquisitions	Increase in intangible assets from acquisitions	(16,769)		(985,354)		Increase in intangible assets from acquisitions	(1,228,872)		(1,150,091)
Purchases of property and equipment	Purchases of property and equipment	(915,582)		(2,376,871)		Purchases of property and equipment	(3,382,481)		(4,760,009)

Proceeds from sale of assets held for sale						Proceeds from sale of assets held for sale	1,104,895		—
Proceeds from sale of property and equipment	Proceeds from sale of property and equipment	59,100		18,515		Proceeds from sale of property and equipment	153,100		2,947,225

Net cash provided by (used in) investing activities	Net cash provided by (used in) investing activities	(100,012,328)		65,173,099		Net cash provided by (used in) investing activities	(252,153,101)		10,995,613
Cash flow from financing activities:	Cash flow from financing activities:					Cash flow from financing activities:
Borrowings from senior notes payable	Borrowings from senior notes payable	108,792,088		32,705,500		Borrowings from senior notes payable	239,248,253		144,676,750
Payments on senior notes payable	Payments on senior notes payable	(46,100,000)		(131,600,000)		Payments on senior notes payable	(368,550,000)		(170,876,750)
Issuance of senior unsecured notes payable						Issuance of senior unsecured notes payable	300,000,000		—
Debt issuance costs associated with senior unsecured notes payable						Debt issuance costs associated with senior unsecured notes payable	(5,113,826)		—
Debt issuance costs associated with senior notes payable	Debt issuance costs associated with senior notes payable	0		(205,500)		Debt issuance costs associated with senior notes payable	—		(376,750)
Proceeds from exercise of stock options	Proceeds from exercise of stock options	1,808,854		0		Proceeds from exercise of stock options	8,682,578		1,006,825
Payments for taxes related to net share settlement of equity awards	Payments for taxes related to net share settlement of equity awards	(137,489)		(119,865)		Payments for taxes related to net share settlement of equity awards	(150,213)		(284,079)
Repayment of finance lease	Repayment of finance lease	(154,619)		0		Repayment of finance lease	(301,721)		(292,201)
Repurchase of common stock	Repurchase of common stock	(21,082,862)		(19,451,287)		Repurchase of common stock	(31,112,523)		(62,686,925)

Net cash provided by (used in) financing activities	Net cash provided by (used in) financing activities	43,125,972		(118,671,152)		Net cash provided by (used in) financing activities	142,702,548		(88,833,130)

Net change in cash and cash equivalents	Net change in cash and cash equivalents	(7,359,134)		(1,658,769)		Net change in cash and cash equivalents	1,139,761		2,368,984
Cash and cash equivalents at beginning of period	Cash and cash equivalents at beginning of period	15,746,454		11,618,922		Cash and cash equivalents at beginning of period	15,746,454		11,618,922

Cash and cash equivalents at end of period	Cash and cash equivalents at end of period	$	8,387,320	$	9,960,153	Cash and cash equivalents at end of period	$	16,886,215	$	13,987,906

Supplemental Disclosures:	Supplemental Disclosures:					Supplemental Disclosures:
Interest paid during the period	Interest paid during the period	$	5,295,753	$	6,046,067	Interest paid during the period	$	11,251,918	$	11,283,327
Income taxes paid during the period	Income taxes paid during the period	$	7,729,025	$	666,505	Income taxes paid during the period	$	19,204,025	$	8,731,860

WORLD ACCEPTANCE CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 – BASIS OF PRESENTATION

The consolidated financial statements of the Company at ~~June~~September 30, 2021 and for the three and six months then ended were prepared in accordance with the instructions for Form 10-Q and are unaudited; however, in the opinion of management all adjustments (consisting only of items of a normal, recurring nature) necessary for a fair presentation of the financial position at ~~June~~September 30, 2021, and the results of operations and cash flows for the periods ended ~~June~~September 30, 2021 and 2020, have been included. The results for the interim periods are not necessarily indicative of the results that may be expected for the full year or any other interim period.

The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amount of assets and liabilities and disclosure of contingent liabilities at the date of the consolidated financial statements and the reported amount of revenue and expenses during the reporting period. Actual results could differ from those estimates.

The consolidated financial statements do not include all disclosures required by GAAP and should be read in conjunction with the Company’s audited consolidated financial statements and related notes for the fiscal year ended March 31, 2021, included in the Company’s Annual Report on Form 10-K for the fiscal year ended March 31, 2021, as filed with the SEC. ~~In addition to the "Critical Accounting Policies" impacted by the new CECL standard described below, the~~The Company applies the accounting policies contained in Note 1 to the Consolidated Financial Statements included in the Company's Annual Report on Form 10-K for the year ended March 31, 2021. The Company believes that the disclosures are adequate to make the information presented not misleading. Certain reclassifications have been made to the amounts previously reported to conform to the current period presentation.

NOTE 2 – ASSETS HELD FOR SALE

In the fourth quarter of fiscal 2020 the Company moved its corporate headquarters from properties it owned outright in Greenville, South Carolina to leased office space in downtown Greenville, South Carolina. Under ASC 360-10, the properties met the criteria for classification as held for sale as of March 31, 2020. During the second quarter of fiscal 2021 the Company completed the sale of 2 of the 3 buildings held for sale. AsDuring the second quarter of ~~June 30, 2021,~~fiscal 2022 the Company ~~still expects to complete~~completed the sale of the ~~third, and final, building~~last held for ~~sale.~~sale building, and recorded a $39.0 thousand loss on sale which is included as a component of Insurance income, net and other income in the consolidated statements of operations.

The following table reconciles the major classes of assets held for sale to the amounts presented in the Consolidated Balance Sheets:
June 30, 2021 March 31, 2021
Assets held for sale:
Property and equipment, net $ 1,143,528 $ 1,143,528
Total assets held for sale $ 1,143,528 $ 1,143,528


	September 30, 2021		March 31, 2021
Assets held for sale:
Property and equipment, net	$	—	$	1,143,528
Total assets held for sale	$	—	$	1,143,528

NOTE 3 – SUMMARY OF SIGNIFICANT POLICIES

Nature of Operations

The Company is a small-loan consumer finance company headquartered in Greenville, South Carolina that offers short-term small loans, medium-term larger loans, related credit insurance products and ancillary products and services to individuals who have limited access to other sources of consumer credit. The Company offers income tax return preparation services to its loan customers and other individuals.

The Company's loan volume and corresponding loans receivable follow seasonal trends. The Company's highest loan demand generally occurs from October through December, its third fiscal quarter. Loan demand is generally lowest and loan repayment highest from January to March, its fourth fiscal quarter. Loan volume and average balances remain relatively level during the remainder of the year. Consequently, the Company experiences significant seasonal fluctuations in its operating results and cash

needs. Operating results for the Company's third fiscal quarter are generally lower than in other quarters and operating results for its fourth fiscal quarter are generally higher than in other quarters.

Loans receivable, net

Loans receivable are carried at the gross amount outstanding, reduced by unearned interest and insurance income, net of deferred origination fees and direct costs and an allowance for credit losses. Fees received and direct costs incurred for the origination of loans are deferred and amortized to interest income over the contractual lives of the loans using the interest method. Unamortized amounts are recognized in income at the time that loans are refinanced or paid in full except for those refinancings that do not constitute a more than minor modification.

Allowance for credit losses

Refer to Note 5, “Finance Receivables and Allowance for Credit Losses,” in this Quarterly Report on Form 10-Q for information regarding the Company's adoption of the CECL allowance model on April 1, 2020 and a description of the methodology it utilizes.

Certain prior period amounts have been reclassified to conform to the current presentation. Such reclassifications had no impact on previously reported net income or shareholders' equity.

Recently Issued Accounting Standards Not Yet Adopted

We reviewed all newly issued accounting pronouncements and concluded that they are either not applicable to our business or are not expected to have a material effect on the consolidated financial statements as a result of future adoption.

NOTE 4 – FAIR VALUE

Fair Value Disclosures

The Company may carry certain financial instruments and derivative assets and liabilities at fair value measured on a recurring or nonrecurring basis. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants on the measurement date. The Company measures the fair values of its financial instruments based on the fair value hierarchy, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value.

Fair value measurements are grouped in three levels. The levels prioritize the inputs used to measure the fair value of the assets or liabilities. These levels are:

•Level 1 – Quoted prices (unadjusted) in active markets for identical assets or liabilities.

•Level 2 – Inputs other than quoted prices that are observable for assets and liabilities, either directly or indirectly. These inputs include quoted prices for similar assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are less active.

•Level 3 – Unobservable inputs for assets or liabilities reflecting the reporting entity’s own assumptions.

The Company’s financial instruments consist of cash and cash equivalents, loans receivable, net, senior notes payable, and senior unsecured notes payable. ~~Fair value approximates carrying value for all of these instruments.~~ Loans receivable are originated at prevailing market rates and have an average life of approximately eight months. Given the short-term nature of these loans, they are continually repriced at current market rates. The Company’s revolving credit facility has a variable rate based on a margin over LIBOR and reprices with any changes in LIBOR. The fair value of the senior unsecured notes payable is estimated based on quoted prices in markets that are not active. The Company also considers its creditworthiness in its estimation of fair value.

The carrying amounts and estimated fair values of financial assets and liabilities disclosed but not carried at fair value and their level within the fair value hierarchy are summarized below.

The carrying amounts and estimated fair values of amounts the Company measures at fair value on a non-recurring basis, which are limited to the Company's assets held for sale, are summarized below.

The Company re-valued its corporate headquarters in Greenville, South Carolina as of March 31, 2020 in conjunction with its reclassification of the related assets as held for sale. The observable inputs the Company used in its revaluation were the agreed-upon prices to sell the assets.

There were no other significant assets or liabilities measured at fair value on a non-recurring basis as of ~~June~~September 30, 2021 or March 31, 2021.

NOTE 5 – FINANCE RECEIVABLES AND ALLOWANCE FOR CREDIT LOSSES

The following is a summary of gross loans receivable by Customer Tenure as of:

During the first quarter of fiscal 2021, we adopted ASU 2016-13, which replaces the incurred loss methodology for determining our provision for credit losses and allowance for credit losses with an expected loss methodology that is referred to as the CECL model, using the modified retrospective approach. Upon adoption, the total allowance for credit losses increased by $28.6 million, with no impact to the consolidated statement of operations.

Based on the Company’s loan products, the purpose and the term, current payment performance is used to assess the capability of the borrower to repay contractual obligations of the loan agreements as scheduled. Current payment performance is monitored by management on a daily basis. On an as needed basis, qualitative information may be taken into consideration if new information arises related to the customer’s ability to repay the loan. The Company’s payment performance buckets are as follows: current, 30-60 days past due, 61-90 days past due, 91 days or more past due.

The following table provides a breakdown of the Company’s gross loans receivable by current payment performance on a recency basis and year of origination at ~~June~~September 30, 2021:

The following table provides a breakdown of the Company’s gross loans receivable by current payment performance on a recency basis and year of origination at March 31, 2021:


	Term Loans By Origination
Loans	Up to 1 Year Ago		Between 1 and 2 Years Ago		Between 2 and 3 Years Ago		Between 3 and 4 Years Ago		Between 4 and 5 Years Ago		More than 5 Years Ago		Total
Current	$	970,526,682	$	45,769,052	$	2,102,732	$	154,890	$	14,444	$	831	$	1,018,568,631
30 - 60 days past due	21,862,634		2,011,261		153,417		21,426		3,500		2,069		24,054,307
61 - 90 days past due	18,039,010		1,208,936		88,119		11,800		571		—		19,348,436
91 or more days past due	31,126,328		3,120,210		183,434		14,028		14,708		168		34,458,876
Total	$	1,041,554,654	$	52,109,459	$	2,527,702	$	202,144	$	33,223	$	3,068	$	1,096,430,250

	Term Loans By Origination
Tax advance loans	Up to 1 Year Ago		Between 1 and 2 Years Ago		Between 2 and 3 Years Ago		Between 3 and 4 Years Ago		Between 4 and 5 Years Ago		More than 5 Years Ago		Total
Current	$	7,583,075	$	9,360	$	—	$	—	$	—	$	—	7,592,435
30 - 60 days past due	686,667		1,423		—		—		—		—		688,090
61 - 90 days past due	—		—		321		—		—		—		321
91 or more days past due	—		34,509		656		—		—		—		35,165
Total	$	8,269,742	$	45,292	$	977	$	—	$	—	$	—	$	8,316,011
Total gross loans													$	1,104,746,261

The following table provides a breakdown of the Company’s gross loans receivable by current payment performance on a ~~recency~~contractual basis and year of origination at ~~March 31,~~September 30, 2021:

~~The following table provides a breakdown of the Company’s gross loans receivable by current payment performance on a contractual basis and year of origination at June 30, 2021:~~

Term Loans By Origination
Loans Up to
1
Year Ago Between
1 and 2
Years Ago Between
2 and 3
Years Ago Between
3 and 4
Years Ago Between
4 and 5
Years Ago More than
5
Years Ago Total
Current $ 1,090,473,262 $ 31,698,268 $ 2,169,389 $ 77,983 $ 3,061 $ 831 $ 1,124,422,794
30 - 60 days past due 32,347,248 1,643,999 131,190 0 0 0 34,122,437
61 - 90 days past due 17,594,353 1,175,151 93,413 7,662 0 0 18,870,579
91 or more days past due 33,739,567 8,214,583 1,117,315 130,116 30,527 432 43,232,540
Total $ 1,174,154,430 $ 42,732,001 $ 3,511,307 $ 215,761 $ 33,588 $ 1,263 $ 1,220,648,350
Term Loans By Origination
Tax advance loans Up to
1
Year Ago Between
1 and 2
Years Ago Between
2 and 3
Years Ago Between
3 and 4
Years Ago Between
4 and 5
Years Ago More than
5
Years Ago Total
Current $ 136,117 $ 0 $ 0 $ 0 $ 0 $ 0 $ 136,117
30 - 60 days past due 330,547 0 0 0 0 0 330,547
61 - 90 days past due 596,653 0 0 0 0 0 596,653
91 or more days past due 1,414,131 12,568 321 0 0 0 1,427,020
Total $ 2,477,448 $ 12,568 $ 321 $ 0 $ 0 $ 0 $ 2,490,337
Total gross loans $ 1,223,138,687

The following table provides a breakdown of the Company’s gross loans receivable by current payment performance on a contractual basis and year of origination at March 31, 2021:

The allowance for credit losses is applied to amortized cost, which is defined as the amount at which a financing receivable is originated, and net of deferred fees and costs, collection of cash, and charge-offs. Amortized cost also includes interest earned but not collected.

Credit Risk is inherent in the business of extending loans to borrowers and is continuously monitored by management and reflected within the allowance for credit losses for loans. The allowance for credit losses is an estimate of expected losses inherent within the Company’s gross loans receivable portfolio. In estimating the allowance for credit losses, loans with similar risk characteristics are aggregated into pools and collectively assessed. The Company’s loan products have generally the same terms therefore the Company looked to borrower characteristics as a way to disaggregate loans into pools sharing similar risks.

In determining the allowance for credit losses, the Company examined four borrower risk metrics as noted below.

3.Prior loan performance

To determine how well each metric predicts default risk the Company uses loss rate data over an observation period of twelve months at the loan level.

The information value was then calculated for each metric. From this analysis management determined the metric that had the strongest predictor of default risk was Customer Tenure. The Customer Tenure buckets used in the allowance for credit loss calculation are:

Management will continue to monitor this credit metric on a quarterly basis.

Management estimates an allowance for each Customer Tenure bucket by performing a historical migration analysis of loans in that bucket for the twelve most recent historical twelve-month migration periods, adjusted for seasonality. All loans that are greater than 90 days past due on a recency basis and not written off as of the reporting date are reserved for at 100% of the outstanding balance, net of a calculated Rehab Rate. Management considers whether current credit conditions might suggest a change is needed to the allowance for credit losses by monitoring trends in 60-day delinquencies, FICO scores and average loan size as compared to metrics in the historical migration period. Due to the short term nature of the loan portfolio, forecasted changes in macroeconomic variables such as unemployment do not have a significant impact on loans outstanding at the end of a particular reporting period. Therefore, management develops a reasonable and supportable forecast of losses by comparing the most recent 6-month loss curves as compared to historical loss curves to see if there are significant changes in borrower behavior that may indicate the historical migration rates should be adjusted. If an adjustment is made as a result of the forecast, then the Company has elected to immediately revert back to historical experience past the forecast period.

The following table presents a roll forward of the allowance for credit losses on our gross loans receivable for the three and six months ended ~~June~~September 30, 2021 and ~~2020.~~2020:

The following table is an aging analysis on a recency basis at amortized cost of the Company’s gross loans receivable at ~~June~~September 30, 2021:

The following table is an aging analysis on a recency basis at amortized cost of the Company’s gross loans receivable at March 31, 2021:

The following table is an aging analysis on a contractual basis at amortized cost of the Company’s gross loans receivable at ~~June~~September 30, 2021:

The following table is an aging analysis on a contractual basis at amortized cost of the Company’s gross loans receivable at March 31, 2021:

The Company elected not to record an allowance for credit losses for accrued interest as outlined in ASC 326-20-30-5A. Loans are placed on nonaccrual status when management determines that the full payment of principal and collection of interest according to contractual terms is no longer likely. The accrual of interest is discontinued when a loan is 61 days or more past the contractual due date. When the interest accrual is discontinued, all unpaid accrued interest is reversed against interest income. While a loan is on nonaccrual status, interest revenue is recognized only when a payment is received. Once a loan moves to nonaccrual status, it remains in nonaccrual status until it is paid out, charged off or refinanced. During the three months ended ~~June~~September 30, 2021, the Company reversed a total of ~~$3.8~~$6.8 million of unpaid accrued interest against interest income. During the six months ended September 30, 2021, the Company reversed a total of $10.6 million of unpaid accrued interest against interest income.

The following table presents the amortized cost basis of loans on nonaccrual status as of the beginning of the reporting period and the end of the reporting period and the amortized cost basis of nonaccrual loans without related expected credit loss. It also shows year-to-date interest income recognized on nonaccrual loans:

Accounting Policies and Matters Requiring Management's Judgment

When determining the economic life of a lease the Company adopts a convention of applying an economic life equal to the useful life as specified in its accounting policy. Refer to Note 1, “Property and Equipment,” to the Company's Annual Report on

Form 10-K for the fiscal year ended March 31, 2021 for a description of the Company's accounting policy regarding useful lives.

The Company uses its effective annual interest rate, adjusted for certain assumptions, as the discount rate when evaluating leases under Topic 842. Management applies the adjusted effective annual interest rate to leases entered for the entirety of the subsequent year.

Based on its historical practice, the Company believes it is reasonably certain to exercise a given option associated with a given office space lease. Therefore, the Company classifies all lease options for office space as “reasonably certain” unless it has specific knowledge to the contrary for a given lease. The Company does not believe it is reasonably certain to exercise any options associated with its office equipment leases.

Periodic Disclosures

The Company's leases consist of real estate leases for office space as well as office equipment leases, most of which were classified as operating at ~~June~~September 30, 2021. Both the real estate and office equipment leases range from three years to five years, and generally contain options to extend which mirror the original terms of the lease.

The following table reports information about the Company's lease cost for the three and six months ended ~~June~~September 30, 2021 and 2020:


		Three months ended June 30,					Three months ended September 30,				Six months ended September 30,
			2021		2020				2021		2020		2021		2020
Lease Cost	Lease Cost							Lease Cost
Finance lease cost	Finance lease cost		$	110,429	$	0		Finance lease cost	$	107,812	$	117,764	$	218,241	$	237,895
Amortization of right-of-use assets	Amortization of right-of-use assets		101,906		0			Amortization of right-of-use assets	101,906		101,906		203,812		203,812
Interest on lease liabilities	Interest on lease liabilities		8,523		0			Interest on lease liabilities	5,906		15,858		14,429		34,083
Operating lease cost	Operating lease cost		$	6,824,446	$	7,069,662		Operating lease cost	$	6,873,545	$	7,018,273	$	13,697,991	$	14,087,935
Short-term lease cost	Short-term lease cost		0		1,800			Short-term lease cost	—		—		—		1,800
Variable lease cost	Variable lease cost		932,363		879,650			Variable lease cost	854,470		897,723		1,786,833		1,777,373

Total lease cost	Total lease cost		$	7,977,667	$	7,951,112		Total lease cost	$	7,943,639	$	8,151,524	$	15,921,306	$	16,342,898

Right-of-use assets obtained in exchange for new operating lease liabilities~~(1)~~

The following table reports information about the maturity of the Company's operating and finance leases as of ~~June~~September 30, 2021:

~~June 30, 2021~~

~~Operating lease liability maturity analysis~~

~~Fiscal 2022~~

~~19,577,011~~

~~Fiscal 2023~~

~~22,507,371~~

~~Fiscal 2024~~

~~18,369,057~~

~~Fiscal 2025~~

~~13,527,921~~

~~Fiscal 2026~~

~~9,639,212~~

~~Fiscal 2027~~

~~5,668,322~~

~~Thereafter~~

~~26,624,620~~

~~Total undiscounted lease liability~~

~~115,913,514~~

~~Imputed interest~~

~~26,041,662~~

~~Total discounted lease liability~~

~~89,871,852~~


	Operating Lease		Finance Lease
Fiscal 2022	$	13,122,453	$	203,565
Fiscal 2023	23,020,199		80,067
Fiscal 2024	18,818,997		—
Fiscal 2025	14,192,214		—
Fiscal 2026	10,213,933		—
Fiscal 2027	6,121,179		—
Thereafter	27,238,079		—
Total undiscounted lease liability	112,727,054		283,632
Imputed interest	22,972,648		—
Total discounted lease liability	$	89,754,406	$	283,632

NOTE 7 – AVERAGE SHARE INFORMATION

The following is a summary of the basic and diluted average common shares outstanding:

Options to purchase ~~493,554~~426,382 and ~~642,011~~637,322 shares of common stock at various prices were outstanding during the three months ended ~~June~~September 30, 2021 and 2020 respectively, but were not included in diluted shares outstanding because the option exercise price exceeded the market value of the shares.

Options to purchase 459,785 and 639,654 shares of common stock at various prices were outstanding during the six months ended September 30, 2021 and 2020 respectively, but were not included in diluted shares outstanding because the option exercise price exceeded the market value of the shares.

NOTE 8 – STOCK-BASED COMPENSATION

Stock Incentive Plans

The Company has a 2008 Stock Option Plan, a 2011 Stock Option Plan and a 2017 Stock Incentive Plan for the benefit of certain non-employee directors, officers, and key employees. Under these plans, a total of 3,350,000 shares of common stock have been authorized and reserved for issuance pursuant to grants approved by the Compensation Committee of the Board of Directors. Stock options granted under these plans have a maximum duration of 10 years, may be subject to certain vesting requirements, which are generally three to six years for officers, non-employee directors, and key employees, and are priced at the market value of the Company's common stock on the option's grant date. At ~~June~~September 30, 2021, there were a total of ~~168,849~~156,166 shares of common stock available for grant under the plans.

Stock-based compensation is recognized as provided under FASB ASC Topic 718-10 and FASB ASC Topic 505-50. FASB ASC Topic 718-10 requires all share-based payments to employees, including grants of employee stock options, to be recognized as compensation expense over the requisite service period (generally the vesting period) in the consolidated financial statements based on their grant date fair values. The Company has applied the Black-Scholes valuation model in

determining the grant date fair value of the stock option awards. Compensation expense is recognized only for those options expected to vest.

Long-term Incentive Program and Non-Employee Director Awards

On October 15, 2018, the Compensation Committee and Board approved and adopted a new long-term incentive program that sought to motivate and reward certain employees and to align management’s interest with shareholders' interest by focusing executives on the achievement of long-term results. The program is comprised of four components: Service Options, Performance Options, Restricted Stock, and Performance Shares.

Pursuant to this program, the Compensation Committee approved certain grants of Service Options, Performance Options, Restricted Stock and Performance Shares under the World Acceptance Corporation 2011 Stock Option Plan and the World Acceptance Corporation 2017 Stock Incentive Plan to certain employee directors, vice presidents of operations, vice presidents, senior vice presidents, and executive officers. Separately, the Compensation Committee approved certain grants of Service Options and Restricted Stock to certain of the Company's non-employee directors.

Under the long-term incentive program, up to 100% of the shares of restricted stock subject to the Performance Shares shall vest, if at all, based on the achievement of two trailing earnings per share performance targets established by the Compensation Committee that are based on earnings per share (measured at the end of each calendar quarter, commencing with the calendar quarter ending September 30, 2019) for the previous four calendar quarters. The Performance Shares are eligible to vest over the Performance Share Measurement Period and subject to each respective employee’s continued employment at the Company through the last day of the applicable Performance Share Measurement Period (or as otherwise provided under the terms of the applicable award agreement or applicable employment agreement).

The Performance Share performance targets are set forth below.


Trailing 4-Quarter EPS Targets for September 30, 2018 through March 31, 2025			Restricted Stock Eligible for Vesting (Percentage of Award)
$16.35			40%
$20.45			60%

The Restricted Stock awards vest in 6 equal annual installments, beginning on the first anniversary of the grant date, subject to each respective employee’s continued employment at the Company through each applicable vesting date or otherwise provided under the terms of the applicable award agreement or applicable employment agreement.

The Service Options vest in 6 equal annual installments, beginning on the first anniversary of the grant date, subject to each respective employee’s continued employment at the Company through each applicable vesting date or otherwise provided under the terms of the applicable award agreement or applicable employment agreement. The option price is equal to the fair market value of the common stock on the grant date and the Service Options have a 10-year term.

The Performance Options will fully vest if the Company attains the trailing earnings per share target over four consecutive calendar quarters occurring between September 30, 2018 and March 31, 2025 described below. Such performance target was established by the Compensation Committee and will be measured at the end of each calendar quarter commencing on

September 30, 2019. The Performance Options are eligible to vest over the Option Measurement Period, subject to each respective employee’s continued employment at the Company through the last day of the Option Measurement Period or as otherwise provided under the terms of the applicable award agreement or applicable employment agreement. The option price is equal to the fair market value of the common stock on the grant date and the Performance Options have a 10-year term. The Performance Option performance target is set forth below.


Trailing 4-Quarter EPS Targets for September 30, 2018 through March 31, 2025			Options Eligible for Vesting (Percentage of Award)
$25.30			100%

Fair value was estimated at grant date using the weighted-average assumptions listed below:


		Three months ended June 30,		Three months ended September 30,				Six months ended September 30,
			2021		2020		2021	2020	2021	2020

Dividend Yield	Dividend Yield		0%		0%	Dividend Yield	—%	—%	—%	—%
Expected Volatility	Expected Volatility		57.05%		55.10%	Expected Volatility	57.86%	56.19%	58.35%	56.17%
Average risk-free rate	Average risk-free rate		1.01%		0.43%	Average risk-free rate	0.83%	0.35%	0.89%	0.36%
Expected Life	Expected Life		6.0 years		6.2 years	Expected Life	6.1 years	6.2 years	6.1 years	6.2 years

The expected stock price volatility is based on the historical volatility of the Company's common stock for a period approximating the expected life. The expected life represents the period of time that options are expected to be outstanding after the grant date. The risk-free rate reflects the interest rate at grant date on zero coupon U.S. governmental bonds having a remaining life similar to the expected option term.

Option activity for the ~~three~~six months ended ~~June~~September 30, 2021 was as follows:

The aggregate intrinsic value reflected in the table above represents the total pre-tax intrinsic value (the difference between the closing stock price on ~~June~~September 30, 2021 and the exercise price, multiplied by the number of in-the-money options) that would have been received by option holders had all option holders exercised their options as of ~~June~~September 30, 2021. This amount will change as the market price of the common stock changes. The total intrinsic value of options exercised during the periods ended ~~June~~September 30, 2021 and 2020 was as follows:

June 30,
2021 June 30,
2020
Three months ended $ 2,021,676 $ 0


	September 30, 2021		September 30, 2020

Three months ended	$	9,519,593	$	496,721
Six months ended	$	11,541,269	$	496,721

As of ~~June~~September 30, 2021, total unrecognized stock-based compensation expense related to non-vested stock options amounted to approximately ~~$7.7~~$7.8 million, which is expected to be recognized over a weighted-average period of approximately ~~3.5~~3.2 years.

During the first ~~three~~six months of fiscal 2022, the Company ~~did 0t grant any~~granted 4,062 shares of restricted ~~stock.~~stock (which are equity classified) to certain vice presidents, senior vice presidents, executive officers, and non-employee directors with a grant date weighted average fair value of $188.38 per share.

During fiscal 2021, the Company granted 52,735 shares of restricted stock (which are equity classified) to certain vice presidents with a grant date weighted average fair value of $106.28 per share.

Compensation expense related to restricted stock is based on the number of shares expected to vest and the fair market value of the common stock on the grant date. The Company recognized compensation expense of ~~$3.2~~$3.4 million and ~~$3.5~~$3.9 million for the three months ended ~~June~~September 30, 2021 and 2020, respectively, which is included as a component of general and administrative expenses in the Company’s consolidated statements of operations. The Company recognized compensation expense of $6.6 million and $7.5 million for the six months ended September 30, 2021 and 2020, respectively, which is included as a component of general and administrative expenses in the Company’s consolidated statements of operations.

As of ~~June~~September 30, 2021, there was approximately ~~$24.0~~$21.4 million of unrecognized compensation cost related to unvested restricted stock awards, which is expected to be recognized over the next ~~2.8~~2.6 years based on current estimates.

A summary of the status of the Company’s restricted stock as of ~~June~~September 30, 2021, and changes during the ~~three~~six months ended ~~June~~September 30, 2021, are presented below:

Total Stock-Based Compensation

Total stock-based compensation included as a component of net income during the three and six month periods ended ~~June~~September 30, 2021 and 2020 was as follows:

The Company evaluates each set of assets and activities it acquires to determine if the set meets the definition of a business according to FASB ASC Topic 805-10-55. Acquisitions meeting the definition of a business are accounted for as a business combination while all other acquisitions are accounted for as asset purchases.

The following table sets forth the Company's acquisition activity for the ~~three~~six months ended ~~June~~September 30, 2021 and 2020.


		Three months ended June 30,					Six months ended September 30,
		2021		2020			2021		2020
Acquisitions:	Acquisitions:					Acquisitions:
Number of branches acquired through business combinations	Number of branches acquired through business combinations	0		0		Number of branches acquired through business combinations	—		—
Number of loan portfolios acquired through asset purchases	Number of loan portfolios acquired through asset purchases	1		13		Number of loan portfolios acquired through asset purchases	50		15
Total acquisitions	Total acquisitions	1		13		Total acquisitions	50		15

Purchase price	Purchase price	$	159,640	$	5,761,912	Purchase price	$	10,859,984	$	6,936,938

Tangible assets:	Tangible assets:					Tangible assets:
Loans receivable, net	Loans receivable, net	142,870		4,776,558		Loans receivable, net	9,631,112		5,786,847
Property and equipment	Property and equipment	0		0		Property and equipment	—		—
Total tangible assets	Total tangible assets	142,870		4,776,558		Total tangible assets	9,631,112		5,786,847

Excess of purchase prices over carrying value of net tangible assets	Excess of purchase prices over carrying value of net tangible assets	$	16,770	$	985,354	Excess of purchase prices over carrying value of net tangible assets	$	1,228,872	$	1,150,091

Customer lists	Customer lists	$	11,770	915,354		Customer lists	$	952,872	1,070,091
Non-compete agreements	Non-compete agreements	$	5,000	70,000		Non-compete agreements	$	276,000	80,000
Goodwill	Goodwill	$	0	0		Goodwill	$	—	—

Acquisitions that are accounted for as business combinations typically result in one or more new branches. In such cases, the Company typically retains the existing employees and the branch location from the acquisition. The purchase price is allocated to the tangible assets and intangible assets acquired based upon their estimated fair market values at the acquisition date. The remainder is allocated to goodwill.

Acquisitions that are accounted for as asset purchases are typically limited to acquisitions of loan portfolios. The purchase price is allocated to the tangible assets and intangible assets acquired based upon their estimated fair market values at the acquisition date. In an asset purchase, no goodwill is recorded.

The Company’s acquisitions include tangible assets (generally loans and furniture and equipment) and intangible assets (generally non-compete agreements, customer lists, and goodwill), both of which are recorded at their fair values, which are estimated pursuant to the processes described below.

Acquired loans are valued at the net loan balance. Given the short-term nature of these loans, generally eight months, and that these loans are priced at current rates, management believes the net loan balances approximate their fair value. Under CECL, acquired loans are included in the reserve calculations for all other loan types (excluding TALs). Management includes recent acquisition activity compared to historical activity when considering reasonable and supportable forecasts as it relates to assessing the adequacy of the allowance for expected credit losses. The Company did not acquire any loans that would qualify as PCD's during the period.

Furniture and equipment are valued at the specific purchase price as agreed to by both parties at the time of acquisition, which management believes approximates their fair values.

Non-compete agreements are valued at the stated amount paid to the other party for these agreements, which the Company believes approximates their fair value.

Customer lists are valued with a valuation model that utilizes the Company’s historical data to estimate the value of any acquired customer lists. Customer lists are allocated at a branch level and are evaluated for impairment at a branch level when a triggering event occurs in accordance with FASB ASC Topic 360-10-05. If a triggering event occurs, the impairment loss to the customer list is generally the remaining unamortized customer list balance. In most acquisitions, the original fair value of the

customer list allocated to a branch is less than $100,000, and management believes that in the event a triggering event were to occur, the impairment loss to an unamortized customer list would be immaterial.

The results of all acquisitions have been included in the Company’s Consolidated Financial Statements since the respective acquisition date. The pro forma impact of these branches as though they had been acquired at the beginning of the periods presented would not have a material effect on the results of operations as reported.

Senior Notes Payable; Revolving Credit Facility

At ~~June~~September 30, 2021, the Company's senior notes payable consisted of a $685.0 million senior revolving credit facility. The revolving credit facility was amended in connection with the Company’s Notes offering (described below) on September 27, 2021 to permit the issuance of the Notes described below and increase the amount permitted under the accordion feature from $685.0 million to $785.0 million. At ~~June~~September 30, 2021, ~~$467.7~~$275.7 million was outstanding under the Company's revolving credit facility, not including a $300.0 thousand outstanding standby letter of credit related to workers compensation. To the extent that the letter of credit is drawn upon, the disbursement will be funded by the credit facility. There are no amounts due related to the letter of credit as of ~~June~~September 30, 2021. The letter of credit expires on December 31, 2021; however, it automatically extends for one year on the expiration date. Subject to a borrowing base formula, the Company may borrow at the rate of LIBOR plus an applicable margin of 3.5% with a minimum rate of 4.5%. The revolving credit facility has a commitment fee of 0.50% per annum on the unused portion of the commitment. Commitment fees on the unused portion of the borrowing totaled ~~$0.4~~$0.6 million and ~~$0.4~~$0.8 million for the ~~three~~six months ended ~~June~~September 30, 2021 and 2020, respectively. The amended and restated revolving credit agreement provides for a process to transition to a new benchmark interest rate from ~~LIBOR, if necessary.~~LIBOR.

For the ~~three~~six months ended ~~June~~September 30, 2021 and fiscal year ended March 31, 2021, the Company’s effective interest rate, including the commitment fee and amortization of debt issuance costs, was 5.0% annualized and 5.8%, respectively, and the unused amount available under the revolver at ~~June~~September 30, 2021 was ~~$182.5~~$409.0 million. ~~The Company also had $34.5 million that may become available under the revolving credit facility if it grows the net eligible finance receivables.~~ Borrowings under the revolving credit facility mature on June 7, 2024.

Substantially all of the Company’s assets are pledged as collateral for borrowings under the revolving credit agreement.

Senior Unsecured Notes Payable

On September 27, 2021, we issued $300 million in aggregate principal amount of 7.0% senior notes due 2026 (the “Notes”). The Notes were sold in a private placement in reliance on Rule 144A and Regulation S under the Securities Act of 1933, as amended. The Notes are unconditionally guaranteed, jointly and severally, on a senior unsecured basis by all of the Company’s existing and certain of its future subsidiaries that guarantee the revolving credit facility. Interest on the notes is payable semi-annually in arrears on May 1 and November 1 of each year, commencing May 1, 2022. At any time prior to November 1, 2023, the Company may redeem the Notes, in whole or in part, at a redemption price equal to 100% of the principal amount plus a make-whole premium, as described in the indenture, plus accrued and unpaid interest, if any, to, but not including, the date of redemption. At any time on or after November 1, 2023, the Company may redeem the Notes at redemption prices set forth in the indenture, plus accrued and unpaid interest, if any, to, but not including, the date of redemption. In addition, at any time prior to November 1, 2023, the Company may use the proceeds of certain equity offerings to redeem up to 40.0% of the aggregate principal amount of the Notes issued under the indenture at a redemption price equal to 107.0% of the principal amount of Notes redeemed, plus accrued and unpaid interest, if any, to, but not including, the date of redemption.

We used the net proceeds from this offering to repay a portion of the outstanding indebtedness under our revolving credit facility and for general corporate purposes.

The agreement governing the Company’s revolving credit facility contains affirmative and negative covenants, including covenants that generally restrict the ability of the Company and its subsidiaries to, among other things, incur or guarantee indebtedness, incur liens, pay dividends and repurchase or redeem capital stock, dispose of assets, engage in mergers and consolidations, make acquisitions or other investments, redeem or prepay subordinated debt, amend subordinated debt

documents, make changes in the nature of its business, and engage in transactions with affiliates. The agreement also contains financial covenants, including: (i) a minimum consolidated net worth of $325,000,000; (ii) a minimum fixed charge coverage ratio of 2.75 to 1.0 (iii) a maximum ratio of total debt to consolidated adjusted net worth of ~~2.0~~2.5 to 1.0; and (iv) a maximum collateral performance indicator of 24.0%, as of the end of each calendar month. The collateral performance indicator is equal to the sum of (a) a three-month rolling average rate of receivables at least sixty days past due and (b) an eight-month rolling average net charge-off rate. The agreement allows the Company to incur subordinated debt that matures after the termination date for the revolving credit facility and that contains specified subordination terms, subject to limitations on amount imposed by the financial covenants under the agreement.

The Company was in compliance with these covenants at ~~June~~September 30, 2021 and March 31, 2021 and does not believe that these covenants will materially limit its business and expansion strategy.

The agreement contains events of default including, without limitation, nonpayment of principal, interest or other obligations, violation of covenants, misrepresentation, cross-default and cross-acceleration to other debt, bankruptcy and other insolvency events, judgments, certain ERISA events, actual or asserted invalidity of loan documentation, invalidity of subordination provisions of subordinated debt, certain changes of control of the Company, and the occurrence of certain regulatory events (including the entry of any stay, order, judgment, ruling or similar event related to the Company’s or any of its subsidiaries’ originating, holding, pledging, collecting or enforcing its eligible finance receivables that is material to the Company or any subsidiary) which remains unvacated, undischarged, unbonded or unstayed by appeal or otherwise for a period of 3060 days from the date of its entry and is reasonably likely to cause a material adverse change. If it is determined that a violation of any applicable law has occurred, such violation may give rise to an event of default under our credit agreement if such violation were to result in a material adverse ~~effect~~change on our business, ~~properties,~~operations, results of operations, assets, liabilities, or condition (financial or otherwise), or a material impairment of the Company’s and the subsidiaries’ ability to perform their obligations under the agreement or

related documents, or if the amount of any settlement, penalties, fines, or other payments resulted in the Company failing to satisfy any financial covenants.

The indenture governing the Notes contains certain covenants that, among other things, limit the Company’s ability and the ability of its restricted subsidiaries to (i) incur additional indebtedness or issue certain disqualified stock and preferred stock; (ii) pay dividends or distributions or redeem or purchase capital stock; (iii) prepay subordinated debt or make certain investments; (iv) transfer and sell assets; (v) create or permit to exist liens; (vi) enter into agreements that restrict dividends, loans and other distributions from their subsidiaries; (vii) engage in a merger, consolidation or sell, transfer or otherwise dispose of all or substantially all of their assets; and (viii) engage in transactions with affiliates. However, these covenants are subject to a number of important detailed qualifications and exceptions.

As of ~~June~~September 30, 2021 and March 31, 2021, the Company had ~~$3.2~~$3.3 million and $3.1 million, respectively, of total gross unrecognized tax benefits including interest. Approximately ~~$2.6~~$2.7 million and $2.6 million, respectively, represent the amount of net unrecognized tax benefits that are permanent in nature and, if recognized, would affect the annual effective tax rate. At ~~June~~September 30, 2021, approximately $0.7 million of gross unrecognized tax benefits are expected to be resolved during the next twelve months through the expiration of the statute of limitations and settlement with taxing authorities. The Company’s continuing practice is to recognize interest and penalties related to income tax matters in income tax expense. As of ~~June~~September 30, 2021, the Company had approximately ~~$1.3~~$1.4 million accrued for gross interest, of which ~~$59.2~~$118.4 thousand was accrued during the ~~three~~six months ended ~~June~~September 30, 2021.

The Company is subject to U.S. income taxes, as well as various other state and local jurisdictions. With the exception of a few states, the Company is no longer subject to U.S. federal, state and local, or non-U.S. income tax examinations by tax authorities for years before 2016, although carryforward attributes that were generated prior to 2016 may still be adjusted upon examination by the taxing authorities if they either have been or will be used in a future period.

The Company’s effective income tax rate totaled ~~23.2%~~11.7% for the quarter ended ~~June~~September 30, 2021 compared to ~~26.3%~~21.9% for the prior year quarter. The decrease is primarily due to the permanent tax benefit related to non-qualified stock option exercises as a discrete item in the current quarter, the recognition of Federal Historic Tax Credits in the current quarter and lower than estimated Federal Historic Tax Credits for fiscal 2020 with the ~~correction~~provision to return adjustment being treated as a discrete item in the prior year quarter. This was partially offset by an increase in the disallowed executive compensation under Section 162(m) in the current quarter and the recognition of the permanent tax benefit related to the exclusion of life insurance proceeds in the prior year quarter.

NOTE 12 – COMMITMENTS AND CONTINGENCIES

Derivative Litigation

On September 25, 2020, a shareholder filed a derivative complaint in South Carolina state court, Paul Parshall v. World Acceptance et al., against the Company as the nominal defendant and certain current and former directors and officers as defendants. Pointing to the Company’s resolution with the SEC and DOJ of the Mexico investigation previously disclosed, the complaint alleges violations of South Carolina law, including breaches of fiduciary duties and corporate waste, and that the Company has suffered damages as a result of those alleged breaches. The complaint seeks unspecified monetary damages from the individual defendants, equitable and/or injunctive relief, disgorgement of compensation from the individual defendants, and attorneys’ fees and costs. Because the complaint is derivative in nature, it does not seek monetary damages from the Company. However, the Company may be required to advance, and ultimately be responsible for, the legal fees and costs incurred by the individual defendants.

In addition, from time to time the Company is involved in litigation matters relating to claims arising out of its operations in the normal course of business.

Estimating an amount or range of possible losses resulting from litigation, government actions and other legal proceedings is inherently difficult and requires an extensive degree of judgment, particularly where the matters involve indeterminate claims for monetary damages, may involve fines, penalties or damages that are discretionary in amount, involve a large number of claimants or significant discretion by regulatory authorities, represent a change in regulatory policy or interpretation, present novel legal theories, are in the early stages of the proceedings, are subject to appeal or could result in a change in business practices. In addition, because most legal proceedings are resolved over extended periods of time, potential losses are subject to change due to, among other things, new developments, changes in legal strategy, the outcome of intermediate procedural and substantive rulings and other parties’ settlement posture and their evaluation of the strength or weakness of their case against us. However, in light of the inherent uncertainties involved, an adverse outcome in one or more of these matters could materially and adversely affect the Company’s financial condition, results of operations or cash flows in any particular reporting period.

NOTE 13 – SUBSEQUENT EVENTS

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations

Cautionary Note Regarding Forward-Looking Information

This report on Form 10-Q, including "Management’s Discussion and Analysis of Financial Condition and Results of Operations," contains various "forward-looking statements," within the meaning of The Private Securities Litigation Reform Act of 1995, that are based on management’s beliefs and assumptions, as well as information currently available to management. Statements other than those of historical fact, as well as those identified by the words “anticipate,” “estimate,” “intend,” “plan,” “expect,” “believe,” “may,” “will,” “should,” "would," "could," "continue," "forecast," and any variation of the foregoing and similar expressions are forward-looking statements. Although the Company believes that the expectations reflected in any such forward-looking statements are reasonable, it can give no assurance that such expectations will prove to be correct. Any such statements are subject to certain risks, uncertainties and assumptions. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, the Company’s actual financial results, performance or financial condition may vary materially from those anticipated, estimated or expected. Therefore, you should not rely on any of these forward-looking statements.

Among the key factors that could cause our actual financial results, performance or condition to differ from the expectations expressed or implied in such forward-looking statements are the following: the ongoing impact of the COVID-19 pandemic and the mitigation efforts by governments and related effects on our financial condition, business operations and liquidity, our customers, our employees, and the overall economy; recently enacted, proposed or future legislation and the manner in which it is implemented; changes in the U.S. tax code; the nature and scope of regulatory authority, particularly discretionary authority, that may be exercised by regulators, including, but not limited to, the Securities and Exchange Commission (SEC), Department of Justice, U.S. Consumer Financial Protection Bureau, and individual state regulators having jurisdiction over the Company; the unpredictable nature of regulatory proceedings and litigation, employee misconduct or misconduct by third parties, uncertainties associated with management turnover and the effective succession of senior management; media and public characterization of consumer installment loans, labor unrest the impact of changes in accounting rules and regulations, or their interpretation or application, which could materially and adversely affect the Company’s reported consolidated financial statements or necessitate material delays or changes in the issuance of the Company’s audited consolidated financial statements; the Company's assessment of its internal control over financial reporting; changes in interest rates; risks relating to the acquisition or sale of assets or businesses or other strategic initiatives, including increased loan delinquencies or net charge-offs, the loss of key personnel, integration or migration issues, the failure to achieve anticipated synergies, increased costs of servicing, incomplete records, and retention of customers; risks inherent in making loans, including repayment risks and value of collateral; cybersecurity threats, including the potential misappropriation of assets or sensitive information, corruption of data or operational disruption; our dependence on debt and the potential impact of limitations in the Company’s amended revolving credit facility or other impacts on the Company's ability to borrow money on favorable terms, or at all; the timing and amount of revenues that may be recognized by the Company; changes in current revenue and expense trends (including trends affecting delinquency and charge-offs); the impact of extreme weather events and natural disasters; changes in the Company’s markets and general changes in the economy (particularly in the markets served by the Company). These and other risks are discussed in more detail in Part I, Item 1A “Risk Factors” in the Company's most recent annual report on Form 10-K for the fiscal year ended March 31, 2021 filed with the SEC, and in the Company’s other reports filed with, or furnished to, the SEC from time to time. The Company does not undertake any obligation to update any forward-looking statements it may make.

Results of Operations

The following table sets forth certain information derived from the Company's consolidated statements of operations and balance sheets (unaudited), as well as operating data and ratios, for the periods indicated:

Average gross loans receivable (1)

Net loans receivable (2)


Customer Tenure	Customer Tenure	June 30, 2021		March 31, 2021		Customer Tenure	September 30, 2021		March 31, 2021
0 to 5 months	0 to 5 months	$	103,852,785	$	92,378,097	0 to 5 months	$	160,762,921	$	92,378,097
6 to 17 months	6 to 17 months	111,290,093		106,742,121		6 to 17 months	112,721,013		106,742,121
18 to 35 months	18 to 35 months	210,101,533		169,361,910		18 to 35 months	231,750,261		169,361,910
36 to 59 months	36 to 59 months	151,521,634		130,655,627		36 to 59 months	176,611,569		130,655,627
60+ months	60+ months	643,882,305		597,292,495		60+ months	712,329,556		597,292,495

Tax advance loans	Tax advance loans	2,490,337		8,316,011		Tax advance loans	651,816		8,316,011
Total gross loans	Total gross loans	$	1,223,138,687	$	1,104,746,261	Total gross loans	$	1,394,827,136	$	1,104,746,261


		Three months ended June 30,			Three months ended September 30,						Six months ended September 30,
			2021			2020			2021		2020		2021		2020
Beginning balance	Beginning balance		$	91,722,288		$	96,487,856	Beginning balance	97,852,630		$	112,686,597	$	91,722,288	$	96,487,856
Impact of ASC 326 adoption	Impact of ASC 326 adoption		—			28,628,369		Impact of ASC 326 adoption	—		—		—		28,628,368
Provision for credit losses	Provision for credit losses		30,265,811			25,660,660		Provision for credit losses	42,043,526		26,090,367		72,309,337		51,751,027
Charge-offs	Charge-offs		(30,016,940)			(43,831,942)		Charge-offs	(29,849,610)		(33,793,503)		(59,866,550)		(77,625,445)
Recoveries	Recoveries		5,881,471			5,741,654		Recoveries	4,613,694		4,617,898		10,495,165		10,359,553
Net charge-offs	Net charge-offs		(24,135,469)			(38,090,288)		Net charge-offs	(25,235,916)		(29,175,605)		(49,371,385)		(67,265,892)
Ending Balance	Ending Balance		$	97,852,630		$	112,686,597	Ending Balance	$	114,660,240	$	109,601,359	$	114,660,240	$	109,601,359


				Days Past Due - Recency Basis													Days Past Due - Recency Basis
Customer Tenure	Customer Tenure	Current		30 - 60		61 - 90		Over 90		Total Past Due		Total Loans		Customer Tenure	Current		30 - 60		61 - 90		Over 90		Total Past Due		Total Loans
0 to 5 months	0 to 5 months	$	85,496,091	$	5,646,646	$	4,107,098	$	8,602,948	$	18,356,692	$	103,852,783	0 to 5 months	$	130,841,492	$	11,360,208	$	8,223,747	$	10,337,474	$	29,921,429	$	160,762,921
6 to 17 months	6 to 17 months	99,626,709		4,650,359		2,758,248		4,254,777		11,663,384		111,290,093		6 to 17 months	95,146,387		6,583,447		4,574,435		6,416,744		17,574,626		112,721,013
18 to 35 months	18 to 35 months	197,298,693		5,725,542		3,055,374		4,021,925		12,802,841		210,101,534		18 to 35 months	209,934,364		9,798,948		5,441,891		6,575,058		21,815,897		231,750,261
36 to 59 months	36 to 59 months	143,356,588		3,720,599		1,874,128		2,570,320		8,165,047		151,521,635		36 to 59 months	164,431,451		5,847,505		2,881,394		3,451,219		12,180,118		176,611,569
60+ months	60+ months	615,050,300		13,186,232		6,761,761		8,884,012		28,832,005		643,882,305		60+ months	670,079,012		20,532,756		10,115,257		11,602,531		42,250,544		712,329,556

Tax advance loans	Tax advance loans	169,522		336,303		565,026		1,419,486		$	2,320,815	2,490,337		Tax advance loans	38,999		37,718		33,418		541,681		612,817		651,816
Total gross loans	Total gross loans	1,140,997,903		33,265,681		19,121,635		29,753,468		82,140,784		1,223,138,687		Total gross loans	1,270,471,705		54,160,582		31,270,142		38,924,707		124,355,431		1,394,827,136
Unearned interest, insurance and fees	Unearned interest, insurance and fees	(301,078,657)		(8,777,918)		(5,045,686)		(7,851,140)		(21,674,744)		(322,753,401)		Unearned interest, insurance and fees	(337,028,327)		(14,367,617)		(8,295,284)		(10,325,873)		(32,988,774)		(370,017,101)
Total net loans	Total net loans	$	839,919,246	$	24,487,763	$	14,075,949	$	21,902,328	$	60,466,040	$	900,385,286	Total net loans	$	933,443,378	$	39,792,965	$	22,974,858	$	28,598,834	$	91,366,657	$	1,024,810,035

Percentage of period-end gross loans receivable	Percentage of period-end gross loans receivable			2.7%		1.6%		2.4%		6.7%				Percentage of period-end gross loans receivable			3.9%		2.2%		2.8%		8.9%


				Days Past Due - Recency Basis													Days Past Due - Recency Basis
Customer Tenure	Customer Tenure	Current		30 - 60		61 - 90		Over 90		Total Past Due		Total Loans		Customer Tenure	Current		30 - 60		61 - 90		Over 90		Total Past Due		Total Loans
0 to 5 months	0 to 5 months	$	72,702,970	$	4,799,102	$	5,680,380	$	9,195,642	$	19,675,124	$	92,378,094	0 to 5 months	$	72,702,970	$	4,799,102	$	5,680,380	$	9,195,642	$	19,675,124	$	92,378,094
6 to 17 months	6 to 17 months	94,466,209		3,187,347		2,798,411		6,290,155		12,275,913		106,742,122		6 to 17 months	94,466,209		3,187,347		2,798,411		6,290,155		12,275,913		106,742,122
18 to 35 months	18 to 35 months	158,217,605		3,570,696		2,592,402		4,981,208		11,144,306		169,361,911		18 to 35 months	158,217,605		3,570,696		2,592,402		4,981,208		11,144,306		169,361,911
36 to 59 months	36 to 59 months	123,542,346		2,432,489		1,753,291		2,927,501		7,113,281		130,655,627		36 to 59 months	123,542,346		2,432,489		1,753,291		2,927,501		7,113,281		130,655,627
60+ months	60+ months	569,639,500		10,064,674		6,523,952		11,064,370		27,652,996		597,292,496		60+ months	569,639,500		10,064,674		6,523,952		11,064,370		27,652,996		597,292,496

Tax advance loans	Tax advance loans	7,592,435		688,090		321		35,165		$	723,576	8,316,011		Tax advance loans	7,592,435		688,090		321		35,165		723,576		8,316,011
Total gross loans	Total gross loans	1,026,161,065		24,742,398		19,348,757		34,494,041		78,585,196		1,104,746,261		Total gross loans	1,026,161,065		24,742,398		19,348,757		34,494,041		78,585,196		1,104,746,261
Unearned interest, insurance and fees	Unearned interest, insurance and fees	(259,492,219)		(6,256,776)		(4,892,850)		(8,722,739)		(19,872,365)		(279,364,584)		Unearned interest, insurance and fees	(259,492,219)		(6,256,776)		(4,892,850)		(8,722,739)		(19,872,365)		(279,364,584)
Total net loans	Total net loans	$	766,668,846	$	18,485,622	$	14,455,907	$	25,771,302	$	58,712,831	$	825,381,677	Total net loans	$	766,668,846	$	18,485,622	$	14,455,907	$	25,771,302	$	58,712,831	$	825,381,677

Percentage of period-end gross loans receivable	Percentage of period-end gross loans receivable			2.2%		1.8%		3.1%		7.1%				Percentage of period-end gross loans receivable			2.2%		1.8%		3.1%		7.1%


				Days Past Due - Contractual Basis														Days Past Due - Contractual Basis
Customer Tenure	Customer Tenure	Current		30 - 60		61 - 90		Over 90		Total Past Due			Total Loans		Customer Tenure	Current		30 - 60		61 - 90		Over 90		Total Past Due			Total Loans
0 to 5 months	0 to 5 months	$	84,288,878	$	5,594,534	$	3,942,595	$	10,026,778	$	19,563,907		$	103,852,785	0 to 5 months	$	129,295,224	$	11,569,048	$	8,382,893	$	11,515,755	$	31,467,696		$	160,762,920
6 to 17 months	6 to 17 months	97,816,652		4,635,619		2,608,969		6,228,853		13,473,441			111,290,093		6 to 17 months	93,069,152		6,780,420		4,840,146		8,031,296		19,651,862			112,721,014
18 to 35 months	18 to 35 months	194,896,422		5,844,466		3,113,896		6,246,749		15,205,111			210,101,533		18 to 35 months	206,576,798		10,391,728		6,019,523		8,762,211		25,173,462			231,750,260
36 to 59 months	36 to 59 months	141,381,446		3,850,933		1,952,425		4,336,830		10,140,188			151,521,634		36 to 59 months	161,763,230		6,386,089		3,383,798		5,078,453		14,848,340			176,611,570
60+ months	60+ months	606,039,397		14,196,885		7,252,694		16,393,329		37,842,908			643,882,305		60+ months	659,713,466		22,640,234		11,793,811		18,182,045		52,616,090			712,329,556

Tax advance loans	Tax advance loans	136,117		330,547		596,653		1,427,020		$	2,354,220		2,490,337		Tax advance loans	18,447		29,569		27,070		576,730		633,369			651,816
Total gross loans	Total gross loans	1,124,558,912		34,452,984		19,467,232		44,659,559		98,579,775			1,223,138,687		Total gross loans	1,250,436,317		57,797,088		34,447,241		52,146,490		144,390,819			1,394,827,136
Unearned interest, insurance and fees	Unearned interest, insurance and fees	(296,740,850)		(9,091,216)		(5,136,879)		(11,784,456)		(26,012,551)			(322,753,401)		Unearned interest, insurance and fees	(331,713,378)		(15,332,302)		(9,138,099)		(13,833,322)		(38,303,723)			(370,017,101)
Total net loans	Total net loans	$	827,818,062	$	25,361,768	$	14,330,353	$	32,875,103	$	72,567,224		$	900,385,286	Total net loans	$	918,722,939	$	42,464,786	$	25,309,142	$	38,313,168	$	106,087,096		$	1,024,810,035

Percentage of period-end gross loans receivable	Percentage of period-end gross loans receivable			2.8%		1.6%		3.7%		8.1		%			Percentage of period-end gross loans receivable			4.1%		2.5%		3.7%		10.3		%


Item No.	Item No.	Contents	Page	Item No.	Contents	Page
		GLOSSARY OF DEFINED TERMS	4		GLOSSARY OF DEFINED TERMS	4

		PART I - FINANCIAL INFORMATION			PART I - FINANCIAL INFORMATION
1.	1.	Consolidated Financial Statements (unaudited):	5	1.	Consolidated Financial Statements (unaudited):	5
		Consolidated Balance Sheets as of June 30, 2021 and March 31, 2021	5		Consolidated Balance Sheets as of September 30, 2021 and March 31, 2021	5
		Consolidated Statements of Operations for the three months ended June 30, 2021 and June 30, 2020	6		Consolidated Statements of Operations for the three and six months ended September 30, 2021 and September 30, 2020	7

		Consolidated Statements of Shareholders' Equity for the three months ended June 30, 2021 and June 30, 2020	7		Consolidated Statements of Shareholders' Equity for the three and six months ended September 30, 2021 and September 30, 2020	8
		Consolidated Statements of Cash Flows for the three months ended June 30, 2021 and June 30, 2020	8		Consolidated Statements of Cash Flows for the six months ended September 30, 2021 and September 30, 2020	10
		Notes to Consolidated Financial Statements	9		Notes to Consolidated Financial Statements	12
2.	2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	28	2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	32
3.	3.	Quantitative and Qualitative Disclosures about Market Risk	35	3.	Quantitative and Qualitative Disclosures about Market Risk	41
4.	4.	Controls and Procedures	35	4.	Controls and Procedures	41

		PART II - OTHER INFORMATION			PART II - OTHER INFORMATION
1.	1.	Legal Proceedings	36	1.	Legal Proceedings	42
1A.	1A.	Risk Factors	36	1A.	Risk Factors	42
2.	2.	Unregistered Sales of Equity Securities and Use of Proceeds	36	2.	Unregistered Sales of Equity Securities and Use of Proceeds	42
3.	3.	Defaults Upon Senior Securities	36	3.	Defaults Upon Senior Securities	42
4.	4.	Mine Safety Disclosures	36	4.	Mine Safety Disclosures	42
5.	5.	Other Information	36	5.	Other Information	42
6.	6.	Exhibits	36	6.	Exhibits	42

		EXHIBIT INDEX	37		EXHIBIT INDEX	43

		SIGNATURES	38		SIGNATURES	44


	June 30, 2021		March 31, 2021
ASSETS
Cash and cash equivalents	$	8,387,320	$	15,746,454
Gross loans receivable	1,223,138,687		1,104,746,261
Less:
Unearned interest, insurance and fees	(322,753,401)		(279,364,584)
Allowance for credit losses	(97,852,630)		(91,722,288)
Loans receivable, net	802,532,656		733,659,389
Right-of-use asset (Note 6)	89,797,336		90,055,572
Property and equipment, net	24,457,334		26,340,037
Deferred income taxes, net	28,782,464		24,992,742
Other assets, net	38,865,715		31,423,134
Goodwill	7,370,791		7,370,791
Intangible assets, net	22,339,503		23,537,517
Assets held for sale (Note 2)	1,143,528		1,143,528

Total assets	$	1,023,676,647	$	954,269,164

LIABILITIES & SHAREHOLDERS' EQUITY

Liabilities:
Senior notes payable	$	467,699,588	$	405,007,500
Income taxes payable	12,407,028		11,575,861
Lease liability (Note 6)	89,871,852		91,718,075
Accounts payable and accrued expenses	48,227,317		41,040,287

Total liabilities	618,205,785		549,341,723

Commitments and contingencies (Notes 6 and 12)	0		0

Shareholders' equity:
Preferred stock, 0 par value Authorized 5,000,000, 0 shares issued or outstanding	0		0
Common stock, 0 par value Authorized 95,000,000 shares; issued and outstanding 6,693,703 and 6,805,294 shares at June 30, 2021 and March 31, 2021, respectively	0		0
Additional paid-in capital	261,446,129		255,590,674
Retained earnings	144,024,733		149,336,767

Total shareholders' equity	405,470,862		404,927,441

Total liabilities and shareholders' equity	$	1,023,676,647	$	954,269,164


	Three months ended June 30, 2021
	Common Stock
	Shares	Additional Paid-in Capital		Retained Earnings	Total Shareholders' Equity
Balances at March 31, 2021	6,805,294	$	255,590,674	149,336,767	$	404,927,441
Proceeds from exercise of stock options	23,494	1,808,854		—	1,808,854
Common stock repurchases	(134,249)	—		(21,082,862)	(21,082,862)
Restricted common stock expense under stock option plan, net of cancellations ($137,489)	(836)	3,102,974		—	3,102,974
Stock option expense	—	943,627		—	943,627

Net income	—	—		15,770,828	15,770,828
Balances at June 30, 2021	6,693,703	$	261,446,129	144,024,733	$	405,470,862


	Three months ended June 30, 2020
	Common Stock
	Shares	Additional Paid-in Capital		Retained Earnings	Total Shareholders' Equity
Balances at March 31, 2020	7,807,834	$	227,214,577	184,748,490	$	411,963,067
Proceeds from exercise of stock options	0	0		—	0
Common stock repurchases	(326,298)	—		(19,451,287)	(19,451,287)
Restricted common stock expense under stock option plan, net of cancellations ($119,865)	(29,948)	3,417,000		—	3,417,000
Stock option expense	—	1,046,735		—	1,046,735
Cumulative effect of adoption of ASC 326	—	—		(21,242,249)	(21,242,249)


Net income	—	—		15,509,649	15,509,649
Balances at June 30, 2020	7,451,588	$	231,678,312	159,564,603	$	391,242,915


		Nonaccrual Financial Assets											Nonaccrual Financial Assets
Customer Tenure	Customer Tenure	As of June 30, 2021		As of March 31, 2021		Financial Assets 61 Days or More Past Due, Not on Nonaccrual Status		Nonaccrual Financial Assets With No Allowance as of June 30, 2021		Interest Income Recognized		Customer Tenure	As of September 30, 2021		As of March 31, 2021		Financial Assets 61 Days or More Past Due, Not on Nonaccrual Status		Nonaccrual Financial Assets With No Allowance as of September 30, 2021		Interest Income Recognized
0 to 5 months	0 to 5 months	$	14,337,987	$	17,256,243	$	0	$	0	$	337,672	0 to 5 months	$	20,180,823	$	17,256,243	$	—	$	—	$	565,222
6 to 17 months	6 to 17 months	9,313,814		13,153,363		0		0		517,569		6 to 17 months	13,153,496		13,153,363		—		—		825,557
18 to 35 months	18 to 35 months	9,973,520		12,048,132		0		0		528,420		18 to 35 months	15,190,793		12,048,132		—		—		909,227
36 to 59 months	36 to 59 months	6,778,869		8,156,159		0		0		383,805		36 to 59 months	8,807,368		8,156,159		—		—		653,087
60+ months	60+ months	25,567,236		31,947,750		0		0		1,508,141		60+ months	31,343,442		31,947,750		—		—		2,588,262

Tax advance loans	Tax advance loans	2,032,883		46,269		0		0		0		Tax advance loans	654,037		46,269		—		—		—
Unearned interest, insurance and fees	Unearned interest, insurance and fees	(17,944,508)		(20,889,617)		—		—				Unearned interest, insurance and fees	(23,697,282)		(20,889,617)		—		—
Total	Total	$	50,059,801	$	61,718,299	$	0	$	0	$	3,275,607	Total	$	65,632,677	$	61,718,299	$	—	$	—	$	5,541,355


		Shares	Weighted Average Exercise Price		Weighted Average Remaining Contractual Term	Aggregate Intrinsic Value			Shares	Weighted Average Exercise Price		Weighted Average Remaining Contractual Term	Aggregate Intrinsic Value

Options outstanding, beginning of period	Options outstanding, beginning of period	500,168	$	93.89				Options outstanding, beginning of period	500,168	$	93.89
Granted during period	Granted during period	4,898	160.08					Granted during period	17,899	180.33
Exercised during period	Exercised during period	(23,494)	76.99					Exercised during period	(111,122)	78.14
Forfeited during period	Forfeited during period	(4,000)	100.79					Forfeited during period	(7,750)	100.79
Expired during period	Expired during period	0	0					Expired during period	—	—
Options outstanding, end of period	Options outstanding, end of period	477,572	$	95.34	6.2 years	$	31,007,801	Options outstanding, end of period	399,195	$	102.02	6.8 years	$	34,964,006
Options exercisable, end of period	Options exercisable, end of period	189,701	$	82.04	4.0 years	$	14,835,182	Options exercisable, end of period	103,323	$	85.31	4.6 years	$	10,773,204


		Shares	Weighted Average Fair Value at Grant Date			Shares	Weighted Average Fair Value at Grant Date

Outstanding at March 31, 2021	Outstanding at March 31, 2021	614,739	$	101.99	Outstanding at March 31, 2021	614,739	$	101.99
Granted during the period	Granted during the period	0	0		Granted during the period	4,062	188.38
Vested during the period	Vested during the period	(2,666)	118.26		Vested during the period	(2,808)	118.21
Forfeited during the period	Forfeited during the period	0	0		Forfeited during the period	—	—
Outstanding at June 30, 2021		612,073	$	101.92
Outstanding at September 30, 2021					Outstanding at September 30, 2021	615,993	$	102.49


	(a) Total number of shares purchased	(b) Average price paid per share		(c) Total number of shares purchased as part of publicly announced plans or programs	(d) Approximate dollar value of shares that may yet be purchased under the plans or programs(1)
April 1 through April 30, 2021	—	$	—	—	$	21,396,732
May 1 through May 31, 2021	52,967	149.15		52,967	13,496,624
June 1 through June 30, 2021	81,282	162.14		81,282	20,317,898
Total for the quarter	134,249	$	157.01	134,249


*			Filed herewith.
+			Management Contract or other compensatory plan required to be filed under Item 6 of this report and Item 601 of Regulation S-K of the Securities and Exchange Commission.


WORLD ACCEPTANCE CORPORATION

	By: /s/ Scott McIntyre
	Scott McIntyre
	Senior Vice President of Accounting
	Signing on behalf of the registrant and as principal accounting officer
	Date:	~~August 6,~~November 5, 2021